Federal Reserve Bulletin, 2003-06

Volume 89 • Number 6 • June 2003 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

PUBLICATIONS COMMITTEE Lynn S. Fox, Chair • Marianne M. Emerson • Jennifer J. Johnson • Karen H. Johnson • Stephen R. Malphrus • J. Virgil Mattingly, Jr. • Vincent R. Reinhart • Louise L. Roseman • Dolores S. Smith • Richard Spillenkothen • David J. Stockton 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 Publications Department under the direction of Lucretia M. Boyer. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Table of Contents 243 PROFITS AND BALANCE SHEET Publication of Federal Reserve Board's Annual DEVELOPMENTS AT U.S. COMMERCIAL Report and Budget Review BANKS IN 2002 Enforcement actions Despite the lackluster performance of the U.S. Termination of enforcement orders economy, the profitability of the U.S. commercial banking industry was again high in 2002, Recovery of Chairman Greenspan from sucand the return on bank assets reached its highest cessful surgery level in more than three decades. Profitability Board staff changes was spurred in considerable part by declines in market interest rates to extraordinarily low lev- 275 LEGAL DEVELOPMENTS els. Short-term interest rates were low throughout 2002 as a result of the Federal Reserve's Various bank holding company, bank service aggressive easing the year before in response to corporation, and bank merger orders; and pendeconomic weakness, and longer-term rates fell ing cases. to multidecade lows by year-end. Nevertheless, the yield curve steepened on average, benefiting AI FINANCIAL AND BUSINESS STATISTICS net interest margins. The decline in longer-term These tables reflect data available as of interest rates also boosted realized gains on April 28, 2003. securities. The low interest rates strengthened the ability of households and businesses to service their debt, which also supported bank A3 GUIDE TO TABLES profitability. Finally, a change in accounting A4 Domestic Financial Statistics rules that largely eliminated the requirement to A42 Domestic Nonfinancial Statistics amortize goodwill caused a one-time drop in A44 International Statistics expenses. Despite the largest decline in commercial and industrial loans since the 1990-91 A57 GUIDE TO SPECIAL TABLES AND recession, the expansion of bank balance sheets STATISTICAL RELEASES quickened last year, driven primarily by real estate lending and substantial acquisitions of A58 INDEX TO STATISTICAL TABLES securities. Equity capital rose slightly faster than assets, and regulatory capital ratios also A60 BOARD OF GOVERNORS AND STAFF improved a bit, benefiting from an increased share of assets with low regulatory risk weights. A62 FEDERAL OPEN MARKET COMMITTEE AND STAFF; ADVISORY COUNCILS 271 ANNOUNCEMENTS A64 FEDERAL RESERVE BOARD PUBLICATIONS Statement by Chairman Greenspan regarding another term in office A66 SCHEDULE OF RELEASE DATES FOR Federal Open Market Committee directive PERIODIC RELEASES Issuance of final rules on customer identification A68 MAPS OF THE FEDERAL RESERVE SYSTEM by Treasury and federal financial regulators Publication of third consultative paper on new A70 FEDERAL RESERVE BANKS, BRANCHES, Basel Capital Accord AND OFFICES Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 2002 Mark Carlson and Roberto Perli, of the Board's markets evidently adding to the attractiveness of Division of Monetary Affairs, prepared this article. liquidity, banks were the recipients of large inflows Thomas C. Allard assisted in developing the data- of inexpensive savings deposits that helped to reduce base discussed in this article and is responsible interest expense and boost net interest margins. Net for maintaining it. Steve Piraino provided research interest margins also benefited from the shape of the assistance. yield curve, which, despite the decline in long-term rates, was considerably steeper on average in 2002 The U.S. commercial banking industry continued to than in 2001. In addition, the decline in longer-term be highly profitable in 2002, despite the lackluster interest rates boosted realized gains on securities. performance of the U.S. economy. Returns on both Profitability was supported as well by a reduction in bank equity and assets rose, the latter reaching its non-interest expense following a change in accounthighest level in more than three decades (chart 1). An ing rules that substantially limited the requirement to important contributor to last year's bank profitability amortize goodwill. Finally, bank profitability benewas the decline to extraordinarily low levels of mar- fited from a leveling off of loan charge-offs and loan ket interest rates. As a result of the Federal Reserve's provisioning, which seemed to reflect an improved aggressive easing in 2001 in response to economic ability of the household and business sectors to serweakness, short-term interest rates were low through- vice their bank loans and other debt made possible by out 2002 and fell further in November as monetary the generally low levels of market interest rates. policy was eased again (chart 2). Longer-term rates Both the household and business sectors took conbacked up early in the year before falling dramati- siderable advantage of falling long-term interest rates cally to multidecade lows by year-end. With the cost to strengthen their balance sheets. A drop in mortof holding liquid deposits low and with weak equity gage rates to record lows prompted a surge of mortgage refinancing. Households were able to reduce their interest rate burden in part by liquidating some NOTE. Except where otherwise indicated, data in this article are from the quarterly Reports of Condition and Income (Call Reports) for of the equity in their homes and using the proceeds insured domestic commercial banks and nondeposit trust companies to pay down more-expensive consumer debt. Cor- (hereafter, banks). The data consolidate information from foreign and porations also enjoyed a reduction in their interest domestic offices and have been adjusted to take account of mergers. For additional information on the adjustments to the data, see the rate burdens. Moreover, by issuing bonds and paying appendix in William B. English and William R. Nelson, "Profits and down short-term debt obligations, they were able to Balance Sheet Developments at U.S. Commercial Banks in 1997," Federal Reserve Bulletin, vol. 84 (June 1998), p. 408. Size categories, based on assets at the start of each quarter, are as follows: the 1. Measures of bank profitability, 1985-2002 10 largest banks, large banks (those ranked 11 through 100), mediumsized banks (those ranked 101 through 1,000), and small banks. At the Percent Percent start of the fourth quarter of 2002, the approximate asset sizes of the banks in those groups were as follows: the ten largest banks, more than $87 billion; large banks, $6.7 billion to $85 billion; medium- 14 Return on equity N. f 1.2 sized banks, $376 million to $6.5 billion; and small banks, less than 12 — $376 million. / / Return on assets — 1.0 Many of the data series reported here begin in 1985 because the 10 — Call Reports were significantly revised in 1984. Data for 1984 and 8 earlier years are taken from the Federal Deposit Insurance Corpo- 8 —s ration, Statistics on Banking, 1999. The data reported here are also — .6 available on the Internet at http://www.fdic.gov/bank/statistical/ 6 — statistics/index.html. Data shown in this article may not match data published in earlier 4 — — .4 years because of revisions and corrections. In the tables, components may not sum to totals because of rounding. Appendix table A. 1, A-E, 2 — — .2 reports portfolio composition, income, and expense items, all as a percentage of overall net consolidated costs. Appendix table A.2 L_L 1 1 I 1 1 1 1 1 1 1 t ! 1 1 l i lt reports income statement data for all banks. 1987 1990 1993 1996 1999 2002 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

244 Federal Reserve Bulletin • June 2003 2. Selected interest rates, 1999-2003 :Q1 3. Number of banks and share of assets at the largest banks, 1985-2002 Percent Thousands 8 Number — 16 Ten-year Treasury security 7 — —\ — 14 6 — 12 — ^ ^ ^^ 5 — 10 — 8 4 1 1 1 1 1 1 1 I 1 1 I 1 1 1 11 1 1 1 I 1 1 3 Percent 2 Share of assets — 80 — Largest 100 — 60 14 —— 40 13 Largest 10 — 20 ••1122 !! 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 i l l! 1987 1990 1993 1996 1999 2002 NOTE. For definition of bank size, see the text note. second consecutive year, to 305, the smallest number in more than a decade. With the slow pace of economic recovery, only 111 new bank charters were created in 2002, the lowest number in any year since 1999 2000 2001 2002 2003 1994. Thus, total commercial banks in the United SOURCE. For intended federal funds rate, Federal Reserve Board States continued to decline, falling to 7,935 as of (www.federalreserve.gov/fomc/fundsrate.htm); for Treasury security rates, December 31, 2002 (chart 3).1 The share of industry mortgage rate, and Moody's bond rates, Federal Reserve Board, Statistical Release H.15, "Selected Interest Rates" (www.federalreserve.gov/ assets at the ten largest banks continued to increase releases/hl5); for high-yield bond rates, Merrill Lynch Master II index. in 2002, and the rise was due largely to an internal consolidation among Citigroup subsidiaries. This bolster liquidity. The balance sheet strengthening on consolidation had little effect on the share of assets the part of both households and firms likely contrib- at the largest 100 banks, as it took place within this uted to the stabilization of banks' credit quality dur- group. ing 2002. With delinquency rates for business and Reorganization activity also declined at the bank household loans flattening or declining, banks were holding company (BHC) level. The number of mergable to hold loss provisioning steady, albeit at a high ers between BHCs dropped to 126, the smallest numlevel. ber since 1991. The formation of new BHCs, how- Commercial and industrial lending continued to ever, pushed up the overall total by 2 over the year, to decline in 2002 and reflected weak business invest- 5,963. The share of banking and nonbanking assets ment and the paydown of loans with the proceeds held by the top fifty BHCs remained flat, at about of bond issuance. However, bank support of the mort- 77.5 percent. The number of financial holding compagage market was considerable: The share of bank nies, a subset of BHCs that have a greater scope of assets accounted for by residential mortgages and allowed activities under the Gramm-Leach-Bliley mortgage-backed securities rose over the year by Act, rose to 715 in 2002, up from 665 in 2001. The 2lA percentage points, to 26.1 percent. share of BHC assets held at financial holding compa- According to the Federal Deposit Insurance Cor- nies rose to 74 percent. poration, ten commercial banks failed in 2002 and required government assistance to dispose of their assets and insured deposits. At the time of closing, 1. This count of commercial banks, derived from Call Report these banks held about $2.5 billion in assets, a tiny data, may vary slightly from measures, such as those in the Federal percentage of industry assets but the highest share Reserve's Annual Report, that are based on the definition of a bank given in the Bank Holding Company Act and implemented in the since 1993. The number of bank mergers fell for the Federal Reserve's Regulation Y. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 2002 245 BALANCE SHEET DEVELOPMENTS weak stock market. Even so, banks found it necessary to expand their managed liabilities moderately. Total bank assets grew 7.2 percent in 2002, about in Banks seemed to respond to the uncertain ecoline with the expansion of total domestic nonfinancial nomic outlook in 2002 by bolstering their capital debt (table 1). Asset growth was driven primarily by positions. Equity capital grew somewhat more real estate loans—particularly residential mortgage quickly than assets, and the ratio of total regulatory and home equity loans—and securities held on bal- capital to risk-weighted assets rose slightly as well; ance sheet. These advances more than offset sharp the increase in the latter ratio reflected the strong declines in commercial and industrial loans. Overall, growth of assets with low risk weights, such as Treatotal loans and leases increased 5.9 percent last year, sury and agency securities and residential mortgages. a pace more than three times that in 2001. On the liability side of the balance sheet, banks Loans to Businesses enjoyed continued strong inflows of core deposits, a reflection of the drop in the opportunity cost of Commercial and industrial (C&I) loans fell 7.3 perholding liquid deposits and, apparently, of a surge cent over the year, the largest decline since 1991. The in the demand for safe, liquid assets stemming from contraction was due mainly to weak demand, but increased economic uncertainty and a volatile and the decrease reflected also a further tightening of 1. Annual rates of growth of balance sheet items, 1993-2002 Percent MEMO: Dec. 2002 Item 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 (billions of dollars) Assets 5.68 8.06 7.55 6.10 9.23 8.25 5.43 8.77 5.12 7.18 6,954 Interest-earning assets 6.43 5.29 7.77 5.79 8.67 8.29 5.83 8.73 3.95 7.51 5,998 Loans and leases (net) 6.05 9.83 10.53 8.12 5.33 8.90 8.03 9.35 1.84 5.87 4,002 Commercial and industrial .52 9.33 12.26 7.24 12.02 12.94 7.88 8.54 -6.72 -7.29 904 Real estate 6.13 7.90 8.32 5.45 9.30 7.99 12.22 10.74 7.94 14.45 2,049 Booked in domestic offices 6.17 7.64 8.47 5.51 9.52 7.97 12.36 11.02 8.01 14.86 2,018 One- to four-family residential 11.08 10.09 10.05 4.66 9.67 6.36 9.70 9.28 5.69 19.89 1,152 Other .22 4.35 6.24 6.75 9.32 10.29 16.06 13.31 10.95 8.80 866 Booked in foreign offices 4.67 18.35 2.81 3.18 ..34 8.79 6.28 -1.62 3.97 -7.41 31 Consumer 9.06 16.01 9.50 4.90 -2.19 .99 -1.47 8.06 4.25 6.46 649 Other loans and leases 9.98 5.29 14.23 22.28 -7.91 14.06 6.69 7.81 -1.93 -0.34 477 Loan-loss reserves and unearned income -5.82 -2.21 .25 -0.06 -0.50 3.47 2.36 8.04 13.15 5.64 79 Securities 12.26 -4.14 .57 .86 8.85 8.40 5.11 6.36 7.17 16.18 1,518 Investment account 8.11 -1.73 -1.58 -1.10 8.66 12.06 6.68 2.85 8.82 13.52 1,308 U.S. Treasury n.a. n.a. -19.21 -14.28 -8.86 -25.17 -1.89 -32.72 -40.27 41.92 63 U.S. government agency and corporation obligations n.a. n.a. 6.43 3.63 14.18 17.00 1.83 3.75 12.84 17.92 822 Other n.a. n.a. 4.20 1.83 11.20 26.99 20.90 13.39 12.01 2.97 422 Trading account 51.84 -20.46 18.51 14.44 10.00 -13.32 -6.93 37.16 -3.72 36.03 210 Other -8.10 3.30 8.60 1.04 38.55 3.80 -8.37 10.30 13.00 -2.88 478 Non-interest-earning assets -.30 31.61 6.06 8.29 13.03 7.97 2.81 9.01 12.89 5.16 956 Liabilities 5.12 8.31 7.17 5.96 9.12 8.13 5.57 8.59 4.46 7.12 6,321 Core deposits 1.49 -0.17 3.96 4.13 4.52 7.04 .23 7.53 10.55 7.57 3,422 Transaction deposits 5.47 -.32 -3.09 -3.44 -4.55 -1.41 -8.98 -1.31 10.19 -5.09 701 Savings and small time deposits -.85 -.07 8.37 8.35 9.03 10.73 3.80 10.54 10.66 11.40 2,720 Managed liabilities1 12.30 17.58 10.44 9.66 13.83 9.60 15.50 8.80 -2.70 5.32 2,427 Deposits booked in foreign offices 15.06 30.89 5.13 4.27 11.13 8.71 14.60 7.84 -10.96 4.49 658 Large time -9.21 8.72 19.61 21.17 20.14 9.09 14.19 19.37 -3.65 5.08 571 Subordinated notes and debentures 10.82 9.23 6.61 17.74 21.05 17.00 5.07 13.98 9.56 -.60 94 Other managed liabilities 22.18 12.91 11.24 8.21 12.23 9.88 17.69 3.92 2.54 6.48 1,105 Other 15.30 79.17 20.46 2.60 23.79 8.59 -6.39 15.43 3.04 13.62 472 Equity capital 12.58 5.24 12.00 7.74 10.44 9.59 3.93 10.68 12.31 7.87 633 MEMO Commercial real estate loans2 -.60 4.01 6.34 7.67 10.12 11.37 15.42 12.16 12.86 6.88 865 Mortgage-backed securities n.a. n.a. .67 2.06 14.15 22.12 -3.34 3.29 28.97 15.53 691 NOTE. Data are from year-end to year-end. 2. Measured as the sum of construction and land development loans secured 1. Measured as the sum of deposits in foreign offices, large time deposits in by real estate; real estate loans secured by nonfarm nonresidential properties; domestic offices, federal funds purchased and securities sold under repurchase real estate loans secured by multifamily residential properties; and loans to agreements, demand notes issued to the U.S. Treasury, subordinated notes and finance commercial real estate, construction, and land development activities debentures, and other borrowed money. not secured by real estate. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

246 Federal Reserve Bulletin • June 2003 Commercial and Industrial Lending by Size of Bank and Size of Loan The runoff in C&I loans in 2001 and 2002 occurred entirely tion activity and access to the corporate bond market and at the 100 largest commercial banks (chart a). Growth of other sources of external finance among larger firms ampli- C&I loans at other banks (institutions not among the fied the reduction in C&I loan demand at large banks, as 100 largest banks), though slowing, continued to be positive their bigger customers issued bonds in volume to lock in over this period. This divergence between small and large historically low long-term interest rates. Demand-side influbanks contrasts sharply with their much more comparable ences, therefore, appear to be a factor in the recent diverbehavior following the business-cycle peak in 1990. Data gence in the growth rates of C&I loans at small and large on small business loans, available annually since 1993, banks as well as at small and large businesses. make it also possible to examine the pattern of business loan growth by size of borrower.1 As with C&I loans at Supply Factors small banks, loans to small businesses continued to expand over 2001 and 2002, while loans to other, mostly large Measures of C&I loan pricing at large and small banks from businesses contracted (chart b). Further insight is gleaned the Survey of Terms of Business Lending (STBL), however, from an examination of business loan data disaggregated by indicate that differences in demand tell only part of the story both loan size and borrower size. This analysis reveals that (chart d).2 Large commercial banks significantly raised the the runoff of business loans at large banks in 2001 and 2002 risk spread on large loans—measured as the loan rate less was due entirely to loans to other—not small—businesses the rate on a market instrument of comparable maturity, a (chart c). At small banks, the slowdown in lending was proxy for funding costs—during the recent period of cycliabout equally shared by both small and other businesses cal weakness. At the same time, these banks lowered rates (chart c). charged on small C&I loans slightly faster than the decline The relative importance of supply and demand factors in in estimated funding costs, a move that fostered a more explaining the changes of business lending by small and hospitable borrowing environment for smaller firms. By large banks and the implications for the supply of credit to contrast, small banks have increased risk spreads on small large and small businesses in recent years are analyzed in C&I loan originations over the past couple of years. The this box. variability and lack of clear systematic movement in risk spreads on extensions of large loans at small banks during Demand Factors this period indicate that a relatively small number of large C&I loans originated at these institutions. Over the 2001-02 period, sluggish capital expenditures and Differences in the pricing of small C&I loans at large and sharp inventory runoffs reduced the borrowing needs of small banks may reflect in part the greater diversification of firms and significantly depressed demand for C&I loans at small business loan portfolios—both across industries and both small and large banks. Dwindling merger and acquisi- across regions—at large institutions, brought about by A. Growth of C&I loans, by bank size, 1990-2002 B. Growth rates of C&I loans, by size of borrower, all commercial banks, 1994-2002 Quarterly, s.a.a.r. NBER peak 20 To other businesses / 10 ^ - To small businesses \ 10 1990 1992 1994 1996 1998 2000 2002 i ll \ i i 1994 1996 1998 2000 2002 NOTE. The large bank category comprises the top 100 institutions in terms of assets; the small bank category comprises institutions outside the NOTE. Growth rates are Q2 over Q2. Loans to small businesses are in top 100. Data have been merger adjusted. the original amount of $1 million or less. Loans to other businesses are in SOURCE. Call Report. the original amount of more than $1 million. NBER National Bureau of Economic Research. SOURCE. Call Report. NBER National Bureau of Economic Research. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 2002 247 Commercial and Industrial Lending by Size of Bank and Size of Loan—Continued the substantial number of mergers since the mid-1990s. By for mergers between small and large banks. In fact, large diluting the impact of idiosyncratic loan risk, the increasing banks have acquired a substantial volume of loans to small diversification would allow large banks to price loans to businesses through purchases of smaller banks. Indeed, Call small businesses more aggressively. The ability of small Report data that have not been adjusted for mergers show banks to remain competitive—despite the evidence of rela- that large banks' share of all small business loans has risen tive increases in their loan rates in recent years—may be from less than one-third of outstandings in 1994 to about due to their information advantage in establishing and main- one-half in 2002. Thus, large banks have increased their taining local lending relationships.3 share of the market for small business loans even though The increased risk in making loans to larger firms likely they have made relatively few such loans over and above explains the run-up in risk spreads on large business loans what they have acquired through mergers. At the same time, at large commercial banks. Recent corporate governance loans to small businesses have become a growing share of problems, for example, were concentrated among large business loans at small banks: In 2002, small business loans corporations. Moreover, worsening corporate credit quality accounted for almost 60 percent of C&I loans outstanding was most pronounced in the telecom, energy, and airline at small banks, compared with about 48 percent in 1994. At sectors, industries dominated by big firms that are unlikely large banks, by contrast, the share of small business loans as to borrow from smaller banks. This interpretation is cor- a fraction of their total C&I loan portfolio remained remarkroborated by the faster rise in recent years and higher level ably stable from 1994 to 2002, at around 16 percent. of delinquency rates on C&I loans at large banks than at small banks. Greater risk in underwriting big C&I loans NOTE. Egon Zakrajsek, of the Division of Monetary Affairs, prepared this would act to restrict loan supply at large banks and would box material. exacerbate any contraction in C&I lending stemming from 1. Since 1993, domestic commercial banks have reported both their C&I reduced loan demand. The modest narrowing of risk spreads and commercial real estate loans outstanding to small businesses in their June Call Reports. Both types of loans to small businesses are defined as for small loans at large banks, by contrast, would tend to follows: (1) loans with original amounts of $100,000 or less, (2) loans with promote borrowing by small businesses. original amounts between $100,000 and $250,000, and (3) loans with original amounts of between $250,000 and $1 million. For the purposes of this memo, the three loan size classes were aggregated into a single "C&I loans to small businesses" category; the remainder of the C&I loans Lending to Small Businesses by Large and Small Banks outstanding—in the original amount of more than $ 1 million—compose the "C&I loans to other businesses" category. The growth of C&I loans to small businesses has been 2. Because the STBL uses a stratified sample of the banking universe, the large bank category in the survey is not the same as the 100 largest banks. consistently stronger at small banks than at large banks The STBL large bank category includes about forty of the largest institutions (charts a and c). However, to prevent distortions to relative in terms of assets. growth rates caused by the wave of bank consolidations 3. The loan rate data exclude information of any lending fees that may be present and thus should be considered as indicative rather than definitive since the mid-1990s, these growth rates have been adjusted measures of lending costs. Growth rates of C&I loans, by size of bank and D. Weighted median risk spread on C&I loans, borrower, 1997-2002 by size of loan and bank, 1997-2003:Q1 Quarterly Percentage points NBER peak 4.5 — Small banks, 4.0 ^^ smalHoans ^ 3.5 — Large banks, small loans _ j\ fr 3.0 — — Small banks, large loans / A r 2.5 2.0 1.5 ^ Y- 1.0 Large banks, large loans — 1 1 1 1 1 1 1 1 1 1997 1998 1999 2000 2001 2002 1997 1999 2001 2003 NOTE. Growth rates are Q2 over Q2. Loans to small businesses are in NOTE. Small loans are those $1 million or less (in 1996 dollars); large the original amount of $1 million or less. Loans to other businesses are in loans are those greater than $1 million (in 1996 dollars). The spread is over the original amount of more than $1 million. Data have been merger the market rate on an instrument of comparable maturity. adjusted. SOURCE. Survey of Terms of Business Lending. SOURCE. Call Report. NBER National Bureau of Economic Research. NBER National Bureau of Economic Research. 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248 Federal Reserve Bulletin • June 2003 bank lending policies. Although nonfinancial firms probability of lines being drawn because of lessexpanded their capital expenditures a bit last year, certain conditions in the commercial paper market as their internally generated funds rose smartly, which reasons for tightening standards and terms. Concerns caused the financing gap—and thus borrowing about improper corporate accounting practices also needs—to plummet to levels not seen since 1997 restrained supply: According to the August BLPS, (chart 4). A paucity of merger activity and the attrac- most banks had increased their scrutiny of financial tiveness of the bond market as an alternative source statements and loan details in response to the wave of of funds, which induced many firms to issue longer- accounting scandals that permeated the first part of term debt and use the proceeds to pay down bank the year. loans and other short-term debt, also held down Nonetheless, results from the October BLPS sugdemand. Respondents to the Federal Reserve's Senior gested that reduced demand from creditworthy bor- Loan Officer Opinion Survey on Bank Lending Prac- rowers was a much more important reason than tices (BLPS) noted these factors, particularly the first tighter supply conditions for the decline in C&I loans two, in reporting that the demand for C&I loans was last year. Most of the BLPS banks are included in quite weak in 2002 (chart 5, third panel). the 100 largest banks, for which C&I loans dropped On net, BLPS respondents also reported a tighten- more than 10 percent in 2002; in contrast, smaller ing in lending standards in all four surveys conducted banks posted a positive growth rate, albeit below that in 2002, although these fractions declined over the of previous years (see box on C&I lending). course of the year (chart 5, top panel). A similar Unlike C&I loans, growth in commercial real picture can be painted for lending terms (chart 5, estate (CRE) loans was solid in 2002, at 8.8 percent, second panel): According to the BLPS, a substantial percentage of banks (albeit a smaller one than in 5. Supply and demand conditions for C&I loans at 2001) reported increased spreads over the cost of selected banks, large and medium-sized borrowers, funds and increased premiums for riskier loans 1999-2003 :Q1 throughout the year. The responses to special ques- Percent tions in the April 2002 BLPS indicated that most respondent banks, which accounted for more than Net percentage that tightened standards 90 percent of total C&I loans plus unused loan commitments, had also tightened standards and terms for backup lines of credit for commercial paper issuers, particularly those with A2/P2 ratings. Virtually all the banks cited heightened concerns about possible deterioration in issuers' credit quality and a higher Net percentage that increased spreads over cost of funds ^ 4. Financing gap at nonfarm nonfinancial corporations, or increased premiums for riskier loans 1991-2002 Increased premiums — 80 Billions of dollars — — 300 — \ — 250 — 1 — 200 — 1 — 150 — \ — 100 — 50 1 f 1 1 i 1 1 1 1 1 1 1 i 1 1 1992 1994 1996 1998 2000 2002 NOTE. Net percentage is the percentage of banks reporting an increase in demand, a tightening of standards, or an increase in spreads or premiums less, NOTE. The data are four-quarter moving averages. The financing gap is the in each case, the percentage reporting the opposite. The definition for firm difference between capital expenditures and internally generated funds. size suggested for, and generally used by, survey respondents is that large and SOURCE. Federal Reserve Board, Statistical Release Z.l, "Flow of Funds medium-sized firms have sales greater than $50 million. Accounts of the United States," table L. 101 (www.federalreserve.gov/ SOURCE. Federal Reserve Board, "Senior Loan Officer Opinion Survey on releases/zl). Bank Lending Practices." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 2002 249 down modestly from the 10.9 percent growth of 2001. 7. Index of home mortgage refinancing activity, 1991-2002 The slowdown was due entirely to a sharp deceleration in the expansion of construction and land devel- Index: January 4, 1991 = 1 opment lending, which was likely pulled down by high rates of office vacancy and declining office rents. The growth of nonfarm, nonresidential loans and multifamily loans actually picked up in 2002. As has been the pattern of the past several years, lending grew faster at small banks than at larger banks: The — 15 top 100 banks expanded their commercial real estate loans 2.2 percent, less than half the 2001 growth rate, while growth at other banks was 16.1 percent, only a bit less than in the previous year. According to the banks in the BLPS, which are mainly large ones, slower CRE lending flows appeared to reflect both 1992 1994 1996 1998 2000 2002 tighter lending conditions and weaker demand. A SOURCE. Mortgage Bankers Association. substantial (although declining) fraction of BLPS respondents reported a tightening of lending stanwhich jumped an extraordinary 20 percent in 2002. dards throughout 2002 (chart 6). In addition, Home equity loans expanded nearly 40 percent, and responses to the April 2003 BLPS indicated that other one- to four-family residential mortgages also terms for CRE loans had been tightened during 2002, grew rapidly. This acceleration appeared to be due in as they had been in 2001, with significant percentpart to a lack of securitizations, as outstanding resiages of banks reporting increased loan spreads and dential mortgages securitized by banks and for which higher loan-to-value ratios. Banks cited mostly conbanks retained servicing rights or provided credit cerns about the general and local economic outenhancements declined slightly.2 The lack of growth look as well as a decreased tolerance for risk as the in these securitized residential loans may reflect a main causes for tightening their terms. Demand for reduction in the cost of funding loans on balance CRE loans continued to weaken throughout the year, sheet due to strong inflows of deposits (discussed according to BLPS respondents. below). The vigorous demand for residential mortgage Loans to Households credit was due to both an increase in housing construction and the desire of many homeowners to cash Record low mortgage rates supported the growth of out part of their accumulated equity in existing residential mortgage loans held by commercial banks, homes. The Mortgage Bankers Association's index of refinancing activity was moderate for the first 6. Net percentage of selected banks that tightened standards part of 2002 but surged in the second half, coincifor commercial real estate loans, 1999-2003:Q1 dent with the sharp decline in mortgage rates, and peaked at a level even higher than that registered in Percent the fall of 2001 (chart 7). Almost half the respondents to the October BLPS indicated that between — 40 20 percent and 40 percent of the customers who — refinanced their mortgages over the previous six months engaged in cash-out refinancing; about — 30 — \ — 20 — 2. Securitized loans outstanding for which banks retain servicing rights or provide recourse or other credit enhancements have been — 10 reported on bank Call Reports only since June 2001. Thus, 2002 is the first year for which the annual growth of those loans is available. Such securitized one- to four-family residential mortgage loans (excludes 1 1 1 1 1 1 I home equity loans) stood at $712 billion at the end of 2002; the 1999 2000 2001 2002 2003 amount compares with $937 billion held on balance sheet. For home equity loans, the respective values were $21 billion for securitized NOTE. Net percentage is the percentage of banks that reported a tightening loans and $214 billion for loans held on balance sheet. Banks do not of standards less the percentage that reported an easing. SOURCE. Federal Reserve Board, "Senior Loan Officer Opinion Survey on report securitized loans for which they neither retain servicing rights Bank Lending Practices." nor provide credit enhancements. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

250 Federal Reserve Bulletin • June 2003 one-fifth of banks reported that more than 40 percent tighter terms declined in the first part of the year and of their customers did so. remained low thereafter (chart 8). A main reported use of these funds was to pay down other, more expensive household debt. Nevertheless, consumer loans held on banks' balance sheets Other Loans and Leases grew an overall 6.5 percent in 2002—more than 2 percentage points faster than in 2001. The boost Other loans and leases edged slightly lower in 2002. was due largely to a 7.3 percent expansion of con- Because many leases, the largest component in this sumer installment loans that probably reflected in category, are made to businesses, this weak perforpart strong auto sales last year. In contrast to the brisk mance is probably due to some of the same factors advance of consumer loans held on balance sheet, that depressed C&I loans over the past two years. securitized consumer loans on which banks retained Also, banks' interest in engaging in automobile leases servicing rights or provided credit enhancements may have faded after reportedly lower-than-expected grew sluggishly last year, again perhaps because of profits in previous years from such transactions. The a more favorable cost of directly funding consumer second largest component of other loans and leases, loans on balance sheet.3 lending to other depository institutions, posted strong Although many banks have reported efforts to growth after a decline in 2001. expand their lending to households, banks have also increased their scrutiny of credit cards and consumer installment loans, amid high charge-off rates on these Securities loans (discussed below). According to the BLPS, the percentage of banks reporting tighter lending stan- Banks' holding of securities jumped more than dards for credit card and other consumer loans oscil- 16 percent in 2002, the strongest advance in the past lated between about 10 percent and 20 percent during ten years. The increase reflected a rapid expansion of the year, although the percentage of banks reporting both trading accounts and investment accounts.4 As a share of total assets, securities increased 1.3 percentage points, to 21.7 percent, at year-end (chart 9). 3. Banks securitize a considerable share of the consumer loans they The rise is a continuation of the trend initiated in originate. At the end of 2002, securitized consumer loans on which 2001. banks retained servicing rights or provided credit enhancements stood at $353 billion, compared with $649 billion held on balance sheet. The attractiveness of securities may have reflected More than 90 percent of securitized consumer loans were credit card partly the steepness of the yield curve last year receivables. 8. Net percentage of selected banks that tightened 4. Most investment account holdings are in the available-for-sale subcategory, which is marked to market, and increases in their standards on consumer loans other than credit card reported values due to declining interest rates accounted for about loans, 1999-2003 :Q1 2.2 percentage points of reported total securities growth in 2002. Percent 9. Bank holdings of securities as a share of total bank assets, 1991-2002 Percent — — 24 — 22 — — 20 1999 2000 2001 2002 2003 / — 20 NOTE. Net percentage is the percentage of banks reporting a tightening of standards or terms less the percentage that reported an easing. Tightening or easing of terms represents an increase or decrease respectively in spread of 1 I 1 1 1 1 1 1 1 1 1 1 I 1 1 loan yield over bank's cost of funds. 1992 1994 1996 1998 2000 2002 SOURCE. Federal Reserve Board, "Senior Loan Officer Opinion Survey on Bank Lending Practices." NOTE. Data are quarterly. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 2002 251 together with the short maturities of many bank lia- cent contraction in transaction deposits resumed bilities. Much of the increase in banks' securities the pattern of decline exhibited since the mid-1990s. holdings was concentrated in mortgage-backed secu- This downtrend appears to reflect the continued rities (MBS). The diversification of credit risk and spread of arrangements to shift business balances into low regulatory risk weights associated with agency- money market deposit accounts to decrease reserve related MBS no doubt continued to serve as induce- requirements. ments for banks to expand their holdings of Total managed liabilities increased about 5 permortgage-related assets. As has been the case for cent last year. Noticeably faster expansion among several years, growth in MBS was stronger at small banks outside the top 100 reflected their stronger banks than at large banks, with institutions ranked asset growth. The smallest banks, those ranked outside the top 100 now holding about one-quarter of below the top 1,000, continued to show rapid growth all MBS. Overall, at year-end MBS accounted for in managed liabilities, although these instruments almost half of securities held in investment accounts accounted for a relatively small share of their total and almost 10 percent of total assets. Treasury and liabilities. agency securities (excluding agency MBS) also registered strong growth last year. Capital Liabilities Equity capital increased 7.9 percent in 2002, a little faster than assets. Retained earnings, paid-in capital, Core deposits expanded 7.6 percent in 2002, the and unrealized gains on available-for-sale securities highest growth rate of the past ten years, save for the all contributed to the rise in equity capital. While 10.6 percent advance in 2001. In a pattern that is total assets rose more than 7 percent for the year, typical in periods of low market interest rates, the risk-weighted assets grew only about 4 percent. As in growth was fueled entirely by savings accounts, as 2001, banks substituted securities and residential real the opportunity cost of the liquidity they provide fell estate loans, which carry relatively low risk weights, further and a declining and volatile stock market for assets with high risk weights, such as C&I loans. generated a strong demand for liquid and safe assets. Tier 1 capital increased 5.6 percent for the year, A runoff of small time deposits partly offset the while tier 2 capital increased 2.3 percent.5 The levstrong inflows to liquid deposits, but the sum of small erage ratio edged up 2 basis points, to 7.83 percent, time and savings deposits expanded briskly and at the end of the fourth quarter. The ratio of tier 1 pushed the share of this category to almost 50 per- capital to risk-weighted assets increased slightly to cent of total domestic liabilities (chart 10). The just under 10 percent. The ratio of tier 1 and tier 2 strong inflow of core deposits enabled banks, capital to risk-weighted assets rose to 12.83 percent especially large ones, to hold down their reliance over the year (chart 11). The increase of 7 basis on more-expensive managed liabilities. A 5.1 per- points was due almost entirely to banks outside the top 100, for which the ratio advanced 29 basis points; 10. Selected domestic liabilities at banks as a share of their at larger banks the ratio inched up only 2 basis points. total domestic liabilities, 1996-2002 The share of assets held by banks that were considered well capitalized for regulatory purposes 5. Tier 1 and tier 2 capital are regulatory measures. Tier 1 capital consists primarily of common equity (excluding intangible assets such as goodwill and excluding net unrealized gains on investment account securities classified as available for sale) and certain perpetual preferred stock. Tier 2 capital consists primarily of subordinated debt, preferred stock not included in tier 1 capital, and loan-loss reserves. Total capital is tier 1 plus tier 2 capital. Risk-weighted assets are calculated by multiplying the amount of assets and the creditequivalent amount of off-balance-sheet items (an estimate of the Transaction deposits ^ potential credit exposure posed by the item) by the risk weight for each category. The risk weights rise from 0 to 1 as the credit risk of the assets increases. The leverage ratio is the ratio of tier 1 I I _J I I I LJ capital to average tangible assets. Tangible assets are equal to total 1996 1997 1998 1999 2000 2001 2002 assets less assets excluded from common equity in the calculation of NOTE. Data are quarterly. tier 1. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

252 Federal Reserve Bulletin • June 2003 11. Regulatory capital ratios, 1991-2002 12. Assets and regulatory capital at well-capitalized banks, 1991-2002 Total (tier 1 + tier 2) ratio Share of industry assets at well-capitalized banks — 100 — 80 — 60 — 40 Percentage points NOTE. For the definition of capital ratios, see text note 5. remained near its very high level of the past several years (chart 12).6 1992 1994 1996 1998 2000 2002 NOTE. For the definition of "well capitalized" and of the margin by which banks remain well capitalized, see text note 6. Derivatives value of contracts with negative value was $1.14 tril- Derivatives are financial instruments whose value is lion. On net, the fair value was $27 billion, a level based on the prices of other instruments. Banks enter down about $4 billion from 2001 but still well above into derivatives contracts both to satisfy customer the level of any other recent year. The overwhelming demand in their role as market makers and to manage majority of derivatives contracts is held by large their own market and credit risks. Banks' use of such institutions: The top ten banks by assets held in contracts, as measured by the notional value of the excess of 97 percent of the value (either notional or underlying assets involved, grew 24 percent in 2002, to more than $56 trillion. The market value of a fair) of all contracts last year. derivatives contract, however, is typically much The most common type of derivatives contracts is smaller than its notional value. When acting to meet swaps, which are agreements to exchange the paycustomer demand, banks usually limit their net expo- ment streams of two underlying assets (for example, sure by entering into at least partially offsetting con- the interest payments of a fixed-rate and of a variabletracts with different counterparties. These offsetting rate bond); at the end of 2002, swaps accounted for transactions account for the bulk of banks' activities 58 percent of the notional value of all derivatives. in derivative markets. At the end of 2002, the fair Forwards (agreements to buy or sell the underlying market value of banks' contracts that had positive asset for a certain price at a certain date in the future) market value was $1.17 trillion, while the fair market and options (contracts giving the buyer the right to buy or sell a specified asset at a specified price on or before a certain future date) account for an additional 6. Well-capitalized banks are those with a total capital ratio greater 41 percent of total notional value. than 10 percent, a tier 1 ratio greater than 6 percent, a leverage ratio One of the fastest growing derivatives markets in greater than 5 percent, and a composite CAMELS rating of 1 or 2. Each letter in the CAMELS stands for a key element of a bank's which banks are involved is that for credit derivafinancial condition—Capital adequacy, Asset quality, Management, tives, although it constitutes only about 1 percent of Earnings, Liquidity, and Sensitivity to market risks. The average the total notional value. Credit derivatives transfer margin by which banks remained well capitalized was computed as follows. Among the leverage, tier 1, and total capitalized ratios of the risk of default of certain assets from one party, the each well-capitalized bank, the institution's tightest capital ratio is beneficiary, to another, the guarantor; banks act both defined as the one closest to the regulatory standard for being well as guarantors and beneficiaries. The market for credit capitalized. The bank's margin is then defined as the percentage-point difference between its tightest capital ratio and the corresponding derivatives is even more concentrated than the marregulatory standard. The average margin among all well-capitalized ket for other derivatives, with five banks accounting banks—the measure referred to in chart 12—is the weighted average for 96 percent of the notional value outstanding. On of all the individual margins, with the weights being each bank's share of the total assets of well-capitalized banks. net, banks have been receivers of guarantees in each Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 2002 253 year since 1997 (the first year for which data are improved. A steep yield curve fostered a noticeable available), except for 2001. In 2002 banks were net rise in net interest income as a share of assets. Nonreceivers of guarantees totaling about $59 billion. interest income grew at about the pace of recent According to a survey conducted by Fitch Ratings, years, but non-interest expense declined significantly those net guarantees were likely provided largely by as a share of assets, largely because of a change in the insurance and reinsurance sector. accounting rules regarding goodwill rather than an A series of special questions in the January 2003 active move on the part of banks to reduce costs. BLPS elicited some information on how banks use Falling interest rates allowed banks to book somethe most common of credit derivatives, credit default what greater realized gains on securities in 2002 than swaps (CDS).7 Only thirteen domestic banks said that in 2001. Loan-loss provisioning, while considerable, they use CDS to hedge risk in their C&I loan port- held steady as a share of assets as credit quality folio. Even among those banks that use CDS for this stabilized during 2002. purpose, the majority do so for less than 4 percent of This confluence of positive developments caused their total C&I loan commitments (outstanding loans banks' return on assets to rise 16 basis points, to plus unused lines of credit). The most commonly 1.33 percent, the highest level in three decades, while cited reason for buying credit protection is that the return on equity advanced 1.1 percentage points, purchasing CDS is superior to selling loans outright to 14.5 percent. Consistent with robust aggregate because the transactions preserve the bank's relation- earnings, relatively few banks were unprofitable: ship with the borrower. Also important was that CDS The proportion of banks with negative net income can provide protection for loans for which no resale declined 1.7 percentage points, to 6.5 percent, and or securitization markets exist. A smaller fraction of accounted for only 1.6 percent of industry assets. banks use CDS to acquire credit exposure—that is, A 22 percent surge in banks' dividend paythey are net sellers of protection—and most of these ments, made primarily to parent holding compabanks that do so report that such exposure equals less nies, reflected the strong earnings. Relative to afterthan 2 percent of their total C&I loan commitments. tax income, dividends in 2002 were at their highest The two most important reasons given for selling level in more than a decade. Also, rapid growth of credit protection are its risk diversification benefits retained income boosted equity capital. The high and its profitability relative to lending. levels of profitability led bank holding company Almost all banks that use CDS, both as buyers and stocks (chart 13) to outperform the S&P 500 during sellers of protection, reported that their participation 2002. Within that total, though, concerns about the in the CDS market did not affect their direct C&I exposure of the largest holding companies to some of lending. A few banks, however, indicated that their the major corporate bankruptcies during the year CDS market participation allowed them to increase restrained the growth "of stock prices at the top fifty moderately their direct C&I lending. Among the banking organizations. These concerns were most domestic banks that do not use CDS either to hedge loans or as standalone investments, most found the expenses related to CDS outweighed the benefits. 13. Indexes of bank stock prices and the S&P 500, 2000-March 2003 Other often-cited reasons for avoiding CDS are their risk, the complications of managing them, and the difficulty of finding them in the desired amounts or maturities. Although relatively few banks actively participate in the CDS market, a majority of BLPS respondents reported using CDS spreads to impute value to certain loan assets or to price new loans. TRENDS IN PROFITABILITY The profitability of the banking industry increased markedly in 2002 as most income components 7. In a credit default swap, the guarantor agrees, for an upfront or continuing premium or fee, to compensate the beneficiary by a speci- NOTE. Banks are ranked by market value, and stock prices are weighted by fied amount upon the occurrence of a specified event, such as the market value. default of the referenced obligor. SOURCE. Standard and Poor's and American Banker. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

254 Federal Reserve Bulletin • June 2003 evident last summer, when the association of a few 14. Net interest margins, by size of bank, 1985-2002 very large banks with major corporate accounting scandals began to surface and to receive intense publicity. Interest Income and Expense All banks Banks' interest expense and interest income both moved down with the general level of interest rates last year. On balance, banks benefited as interest expense tumbled 37 percent, while interest income declined only 13 percent. Thus, the industry's net interest margin—the ratio of net interest income to average interest-earning assets—increased in 2002 for the second consecutive year, rising 9 basis points, to 4.04 percent (chart 14). Much of the improvement occurred early in the year, when the yield curve was Other banks steepest. As the yield curve flattened during the year, the net interest margin narrowed. The rise in the net interest margin was greatest at the 100 largest banks.8 Funding at these banks is dependent particularly on managed liabilities, and therefore this group benefited most from the substitution of these liabilities for less-expensive core depos- Top 100 banks its, discussed earlier. The net interest margin was also supported at these banks by a shift toward higher- 1986 1988 1990 1992 1994 1996 1998 2000 2002 yielding loans. The share of interest-earning assets that consists of consumer loans moved up from NOTE. Net interest margin is net interest income divided by average interest-earning assets. For definition of bank size, see the text note. 10.0 percent to 10.5 percent, while the business loan share, which earned a rate of return 4.3 percentage points less than that of consumer loans last year, Although these banks gained somewhat from the decreased from 17 percent to 14.5 percent. inflow of lower-cost core deposits, they also experi- The smallest banks, those outside the 1,000 largest, enced the largest decline in rates of return on their were also able to raise their net interest margin, assets, a drop that reflected mainly a significant fall in despite benefiting least from the inflow of low-cost the share of interest-earning assets consisting of relacore deposits. Their success was due largely to their tively high-return consumer loans. ability to limit the decline in the rate of return on their loans, especially real estate loans, which made up about 45 percent of their interest-earning assets.9 Non-interest Income and Expense Small banks were also relatively successful at limiting the decline in the rate of return on their non- Non-interest income grew 5.3 percent in 2002, credit-card consumer loans. around the pace of the previous two years. The The net interest margin at banks among the 1,000 increase was due in large part to deposit fees, which largest but outside the top 100 declined last year. expanded at a double-digit rate for the third consecutive year. Banks also enjoyed increased gains from the sale of loans, which, though small, nearly doubled 8. The net interest margin rose particularly at the ten largest banks, as a share of total revenue. On their quarterly earnboosted in part by the consolidation of Citigroup subsidiaries noted above. Even after adjusting for this consolidation, however, the net ings statements, banks reported a rise in fees assointerest margin still rose noticeably at these largest banks. As noted ciated with mortgage refinancing, which evidently above, the Citigroup consolidation had little effect on the performance contributed to the 6.6 percent growth in other of the 100 largest banks. 9. Data limitations prevent a disaggregation of earnings between non-interest income. Fiduciary income, primarily residential and commercial real estate loans. Commercial mortgages fees received for services rendered by banks' trust account for 49 percent of all real estate loans at small banks, comdivisions, declined for the second consecutive year. pared with 42 percent for all other banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 2002 255 Non-interest income was also restrained by a 15 percent drop in trading income. Change in the Accounting Standards The ratio of total non-interest expense to total Regarding Goodwill revenue, already low by historical standards, dropped further in 2002, to about 57 percent (chart 15). Most According to the Financial Accounting Standards Board of the decline was due to a change in the account- (FASB), goodwill is an intangible asset that generally ing rules that eliminated the requirement to amortize arises as the result of a corporate merger when the purchase price of a firm exceeds the difference between goodwill unless it is impaired (see box on "Goodthe fair value of the assets acquired and the liabilities will"). A reduction in merger-related charges may assumed.1 As the banking system has consolidated over also have been a factor behind the drop in nonthe past decade, the amount of goodwill in the banking interest expense in 2002: Measured by number and system has expanded rapidly, with an average annual dollar volume, bank mergers were lower in 2002 growth rate of 32 percent (over the same period, assets than in any of the preceding five years. The decline expanded at an average annual rate of 6.8 percent). In in non-interest expense occurred last year despite a 2002, goodwill was about $80 billion, or about 1.2 perjump in the fourth quarter, attributable mainly to cent of total assets. Citibank and J.P. Morgan Chase. The sudden rise In previous years, FASB considered goodwill to be a likely reflected large legal fees and other costs associ- "wasting asset" that would gradually dissipate and hence ated with their roles in the Enron debacle and analyst required that it be amortized over its useful life, up to a malfeasance. maximum of forty years. The expense associated with amortizing goodwill was reported on banks' balance Salaries and benefits inched up relative to revenue sheets as part of non-interest expense. According to its in 2002. The increase was entirely at banks outside Statement of Financial Accounting Standards No. 142, the top 100, where salaries and benefits have been however, FASB now considers goodwill to generally steadily rising relative to total revenue since 1996. At represent the intangible "synergies" of the combined the top 100 banks, the ratio of salaries and benefits to institution. As such, goodwill may have an indefinite life, so FASB no longer requires that it be amortized unless it becomes impaired. Goodwill may become impaired when a change occurs in a company's financial circumstances 15. Non-interest expense as a proportion of revenue, 1985-2002 such that the amount of goodwill carried by the company exceeds the current implied fair value of goodwill. The Percent new treatment of goodwill became effective for banks in their first fiscal year occurring after December 15, 2001, Total and contributed significantly to the one-time sharp decline in non-interest expense reported in 2002. 1. For mergers initiated before July 1, 2001, the FASB also allowed the use of a pooling-of-interest method of accounting. In a pooling of interests, the assets, liabilities, and retained earnings of each company are carried forward at their historical carrying amounts to the combined entity. In contrast to the purchase method, no goodwill is recorded in a pooling of interests. Operating results of both companies are combined for all periods before the consummation date, and previously issued financial statements are restated as though the companies had always been combined. total revenue continued to trend down last year, albeit Components more slowly than during the late 1990s. The cost of premises and fixed assets relative to total revenue Other edged lower. Loan Performance and Loss Provisioning Credit quality generally stabilized during 2002. Premises and fixed assets Despite some adverse developments, delinquency rates on most types of household and business loans declined, while others remained steady. On the corporate side, bankruptcies of several large firms, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

256 Federal Reserve Bulletin • June 2003 16. Debt burdens of businesses and households, 1985-2002 17. Delinquency and charge-off rates for loans to businesses, by type of loan, 1991-2002 Percent Percent — 20 Delinquencies ) \ Nonfinancial corporations — 18 — — A. — 16 — j. ^ 14 — Households > — J* — 12 — 10 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 t i ll 1987 1992 1997 2002 NOTE. The debt burden for nonfinancial corporations is calculated as interest payments as a percentage of cash flow. The debt burden for house- Net charge-offs holds is an estimate of the ratio of debt payments to disposable personal — 3.0 income; debt payments consist of the estimated required payments on outstanding mortgage and consumer debt. Data are quarterly. SOURCE. National income and product accounts and the Federal Reserve System. including WorldCom, continued to pressure delinquency and charge-off rates, especially at large banks. Extreme financial stress was also a problem for a segment of the household sector, as the personal bankruptcy rate ran at record levels last year. Working strongly to counter the impact of these problems, however, were the declines in interest rates, which 1992 1994 1996 1998 2000 2002 allowed for a material reduction in the debt burden NOTE. The data are quarterly and seasonally adjusted. Delinquent loans are of businesses and a leveling off for households loans that are not accruing interest and those that are accruing interest but are more than thirty days past due. The delinquency rate is the end-of-period (chart 16). Even so, debt burdens remain elevated in level of delinquent ioans divided by the end-of-period level of outstanding both sectors. loans. The net charge-off rate is the annualized amount of charge-offs over the period, net of recoveries, divided by the average level of outstanding loans over the period. C&I Loans April 2003 BLPS, C&I charge-ofif rates have been high in part because they have been associated with a The delinquency rate on C&I loans rose during the relatively narrow group of delinquent loans on which first two quarters of 2002, but it held steady through recovery rates have been low. In addition, banks have year-end at a relatively elevated 3.9 percent, despite charged off C&I loans aggressively, facilitated by the continued runoffs in outstanding loans (chart 17). growth of a liquid secondary market for distressed This pattern reflects primarily developments at the loans. This market provides banks with a way to clear 100 largest banks; at other banks, the delinquency their balance sheets of underperforming loans. When rate has been about unchanged since the second half loans are sold, they must first be classified as an of 2001 and is below that of the top 100 banks. The "available-for-sale" asset and marked to market, with higher delinquency rate at large banks is consistent any shortfalls of market from book value charged ofif. with the increased difficulties at large firms recently, which are reflected in the rise in bankruptcies following corporate governance scandals. Reportedly, Commercial Real Estate Loans the use of credit default swaps by some large banks mitigated the effects of some of the larger loan Vacancy rates for commercial office buildings condefaults on their credit quality. tinued to increase during 2002 and approached the While delinquency rates are far below the peaks of levels of the early 1990s, and office rents fell faster the early 1990s, recent charge-off rates have exceeded than at any point during the previous fifteen years. their earlier highs. According to responses to the Despite these signs of deterioration in commercial Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 2002 257 real estate markets, delinquency rates on commercial tial real estate loans during 2002 (chart 18) partly real estate loans were low and declining in 2002. reflected the rapid expansion of these loans, as new Charge-off rates have also remained low. loans are much less likely to become delinquent than According to the April 2003 BLPS, the improved older loans. Charge-off rates likely were held down quality of these loans reflects mainly declines in the by the rapid rise in housing prices over the past burden of servicing them due to lower interest rates. several years, which has served to reduce the likeli- In addition, banks reported that some borrowers have hood of a loss to banks when loans are foreclosed. a substantial equity position in their properties, an Delinquency rates on credit card loans, which averadditional incentive to keep loans current. Also, aged 4.87 percent in 2002, were little changed from banks have been reporting on BLPS surveys since the elevated level of a year earlier. By contrast, 1998 that they have been tightening standards on delinquency rates on consumer installment loans commercial real estate loans; and in the January 2002 declined, reaching the lowest level since 1995. The and April 2003 surveys, they reported tightening high charge-off rates on both credit cards and conlending terms in both 2001 and 2002. The most sumer installment loans last year were perhaps partly common method of tightening terms was to reduce a reflection of a jump in personal bankruptcies. maximum loan-to-value ratios. Securitized Loans Loans to Households Delinquency rates on loans that had been securitized The credit quality of loans to households also genby banks and on which they retained servicing rights erally improved last year as the household interest or provided credit enhancements, almost all of which rate burden was held down by falling interest rates. are loans to households, also suggest a stabilization Also, a decline in the delinquency rate on residenof credit quality: A year-end comparison shows that rates slipped from 4.9 percent in 2001 to 4.8 percent in 2002. For securitized residential real estate loans 18. Delinquency and charge-off rates for loans to households, by type of loan, 1991-2002 (both single-family mortgages and home equity loans), delinquency rates ticked up 9 basis points, to Percent 5.0 percent, at the end of 2002. The rate on these securitized loans is more than twice the delinquency rate on loans that are held on banks' books, possibly because a greater proportion of the securitized loans are subprime. Like delinquencies on credit card loans held on banks' books, the delinquency rate on securitized credit card receivables was relatively flat during 2002 and averaged about 5 percent. Delinquency rates on securitized auto loans and some other small items declined. Loss Provisioning Loan charge-offs rose again last year, but the pace of the increase slowed markedly. Accordingly, after two years of growth at rates above 40 percent, loan-loss provisioning increased only 4.3 percent in 2002. As a share of loans and leases, loss provisioning edged up — 2.0 2 basis points in 2002, to 1.16 percent, the highest level since 1992. However, banks' ability to absorb these losses improved slightly as the ratio of loss — o Residential real estate loans provisioning to total revenue moved down a touch, to — 1.0 11.3 percent (chart 19). 1992 1994 1996 1998 2000 2002 The growth in loss provisioning occurred entirely at large banks, where charge-offs have been par- NOTE. See note to chart 17. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

258 Federal Reserve Bulletin • June 2003 19. Provisioning for loan and lease losses as a ever, as charge-offs grew faster than reserves, particupercentage of total revenue, 1991-2002 larly at large banks, the ratio of loan-loss reserves to charge-offs again declined in 2002, moving down to 175 percent, the lowest level since 1991. — 25 INTERNATIONAL OPERATIONS OF — 20 U.S. COMMERCIAL BANKS — 15 With world economic growth remaining sluggish, — 10 banks curbed their foreign operations in 2002, and the share of bank assets booked in foreign offices — 5 fell for the fifth consecutive year, to 10.8 percent. The curtailment of operations abroad was particu- I 1 I 1 I I I I I I I I I 1 I larly notable in Latin America, where U.S. banking 1992 1997 2002 activity declined 24 percent in 2002 (table 2). Argentina remained unstable following the crisis of late ticularly high, consistent with the surge in large 2001, and apprehension regarding the future financorporate bankruptcies. Loss provisioning decreased cial situation in Brazil was considerable. By con- 11 percent at banks outside the 100 largest banks, trast, lending in Eastern Europe, especially Russia, where charge-offs have also diminished. expanded by 36 percent, albeit from a small base. Additions to loan-loss reserves continued to bol- Exposure to Asia remained steady. ster the ratio of loan-loss reserves both to total loans With the decline in exposure to foreign markets, and leases and to delinquent loans (chart 20). How- the share of net income due to foreign operations fell to 6.5 percent, the lowest proportion during the past decade. Also contributing to the decline in earnings 20. Reserves for loan and lease losses, 1985-2002 from international operations was the second consecutive yearly decrease in the return on foreign Percent assets. Likely in response to continued credit prob- As a percentage of total loans and leases lems in Argentina, loss provisioning for foreign loans increased significantly. Such loss provisioning as a ratio of foreign loans jumped to the highest level since 1989 and surpassed that associated with the Russian default of 1998. As a percentage of delinquencies RECENT DEVELOPMENTS Bank profitability continued to be strong in the first quarter of 2003 as many trends of the previous year remained in place. On a seasonally adjusted basis, returns on equity and assets were at their averages for 2002. Robust mortgage refinancing and increased trading revenue provided support to non-interest As a percentage of net charge-offs income, while non-interest expense continued to decline as a share of assets. Although net interest income slipped, banks continued to book capital gains, and provisioning was noticeably below the average for last year on improving credit quality in both household and business sectors. Bank holding company stock prices moved roughly in line with the Wilshire 5000, ending the first quarter at about the NOTE. For definitions of delinquencies and net charge-offs, see note to same level as at the end of 2002. • chart 17. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 2002 259 2. Exposure of banks to selected economies at year-end relative to tier 1 capital, by bank size, 1998-2002 Percent SSeelleecctteedd Eastern Europe Latin America BBaannkk aanndd yyeeaarr AAssiiaann TToottaall ccoouunnttrriieess11 All Russia All Mexico Argentina Brazil All 1998 15.49 3.49 .43 42.93 9.88 9.66 11.27 61.90 1999 14.37 2.85 .37 39.00 9.50 9.40 10.49 56.22 2000 13.17 4.35 .49 37.88 9.08 8.41 11.15 55.40 2001 12.09 4.29 .60 54.06 25.97 6.61 12.99 70.44 2002 11.44 5.53 1.06 38.90 20.80 2.44 8.36 55.87 Money center and other large banks 1998 24.02 5.61 .68 64.20 14.10 15.19 17.04 93.83 1999 20.73 4.25 .55 53.90 12.62 13.63 14.53 78.88 2000 19.98 6.83 .77 54.98 12.69 12.68 16.40 81.79 2001 17.88 6.47 .91 79.08 38.54 9.79 18.74 103.43 2002 16.96 8.17 1.63 57.32 31.14 3.65 12.38 82.45 Other 1998 2.08 .16 .00 9.51 3.24 .97 .00 11.75 1999 1.75 .08 .01 9.41 3.31 1.01 2.47 11.24 2000 1.41 .08 .00 8.35 2.84 1.04 2.08 9.84 2001 1.07 .14 .00 6.45 2.04 .57 2.05 7.66 2002 1.03 .65 .00 5.00 1.86 .02 .96 6.68 MEMO Total exposure (billions of dollars) 1998 37.87 8.53 1.05 104.96 24.15 23.62 27.55 151.36 1999 37.45 7.43 .95 101.63 24.77 24.51 27.34 146.51 2000 37.30 12.33 1.39 107.31 25.71 23.82 31.59 156.94 2001 36.32 12.88 1.80 162.39 78.00 19.87 39.01 211.59 2002 36.32 17.55 3.37 123.53 66.15 7.75 26.55 177.40 NOTE. For definition of tier 1 capital, see text note 5. Exposures consist of (5 money center banks and 5 other large banks) with $206 billion in tier 1 lending and derivatives exposures for cross-border and local-office operations. capital, and the remaining 64 were "other" banks with $112 billion in tier 1 Respondents may file information on one bank or on the bank holding com- capital. The average "other" bank at year-end 2002 had $24 billion in assets. pany as a whole. 1. Indonesia, Korea, Malaysia, Philippines, and Thailand. At year-end 2002, "all reporting" banks consisted of 74 institutions with a SOURCE. Federal Financial Institutions Examination Council Statistical total of $318 billion in tier 1 capital; of these institutions, 10 were "large" banks Release E.16, "Country Exposure Survey," available at www.ffiec.gov/E16.htm/ Appendix tables start on page 260. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

260 Federal Reserve Bulletin • June 2003 A.l. Portfolio composition, interest rates, and income and expense, all U.S. banks, 1993-2002 A. All banks Item 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Balance sheet items as a percentage of average net consolidated assets Interest-earning assets 89.06 87.11 86.97 87.38 87.15 86.77 87.05 87.17 86.53 86.46 Loans and leases, net 56.25 56.07 58.37 59.89 58.69 58.33 59.36 60.52 58.99 57.87 Commercial and industrial 14.88 14.51 15.20 15.60 15.78 16.37 17.07 17.17 16.09 14.08 U.S. addressees 12.72 12.35 12.87 13.07 13.18 13.62 14.43 14.67 13.70 12.05 Foreign addressees 2.16 2.16 2.33 2.53 2.60 2.75 2.64 2.49 2.39 2.04 Consumer 11.00 11.43 12.08 12.21 11.44 10.36 9.71 9.38 9.23 9.35 Credit card 3.88 4.21 4.69 4.87 4.55 3.96 3.51 3.52 3.63 3.78 Installment and other 7.11 7.22 7.39 7.34 6.89 6.39 6.20 5.87 5.61 5.57 Real estate 24.80 24.43 25.01 25.06 25.02 24.87 25.44 27.04 27.10 28.39 In domestic offices 24.18 23.80 24.36 24.43 24.41 24.30 24.87 26.50 26.60 27.91 Construction and land development 1.99 1.65 1.59 1.63 1.73 1.86 2.18 2.51 2.85 2.98 Farmland .57 .56 .56 .56 .55 .55 .56 .56 .55 .56 One- to four-family residential 13.49 13.74 14.42 14.43 14.42 14.26 14.10 14.96 14.67 15.40 Home equity 2.07 1.91 1.88 1.85 1.94 1.89 1.76 1.96 2.18 2.79 Other 11.42 11.84 12.54 12.57 12.48 12.37 12.34 13.00 12.49 12.61 Multifamily residential .79 .79 .81 .85 .83 .82 .88 .99 .97 1.02 Nonfarm nonresidential 7.33 7.07 6.97 6.96 6.88 6.81 7.15 7.48 7.56 7.95 In foreign offices .62 .63 .65 .63 .61 .57 .57 .54 .50 .48 To depository institutions and acceptances of other banks 1.13 1.47 1.92 2.33 1.93 1.91 1.97 1.87 1.83 1.87 Foreign governments .67 .41 .30 .26 .18 .15 .16 .12 .10 .09 Agricultural production .99 1.00 .96 .92 .90 .89 .83 .78 .75 .70 Other loans 3.50 3.29 3.11 3.32 2.80 2.78 2.75 2.58 2.34 2.06 Lease-financing receivables .99 1.03 1.19 1.51 1.87 2.14 2.53 2.65 2.62 2.47 LESS: Unearned income on loans -.21 -.16 -.14 -.12 -.09 -.07 -.06 -.05 -.04 -.05 LESS: LOSS reserves1 -1.51 -1.36 -1.26 -1.21 -1.13 -1.07 -1.04 -1.02 -1.04 -1.11 Securities 25.37 24.32 21.94 21.01 20.41 20.38 20.40 20.02 19.54 21.27 Investment account 22.50 21.60 19.39 18.20 17.25 17.49 18.34 17.59 16.82 18.30 Debt 22.50 21.21 18.98 17.75 16.75 16.94 17.73 16.93 16.49 17.99 U.S. Treasury n.a. 6.71 5.25 4.20 3.38 2.71 2.14 1.66 .85 .79 U.S. government agency and corporation obligations n.a. 10.26 9.81 9.75 9.74 10.28 10.85 10.31 10.08 11.46 Government-backed mortgage pools ... n.a. 4.70 4.47 4.80 4.94 5.17 5.24 4.75 5.13 6.09 Collateralized mortgage obligations n.a. 3.19 2.67 2.11 1.94 2.13 2.15 1.92 1.95 2.35 Other n.a. 2.36 2.68 2.83 2.86 2.99 3.46 3.63 2.99 3.02 State and local government n.a. 2.01 1.80 1.68 1.59 1.57 1.62 1.52 1.49 1.49 Private mortgage-backed securities n.a. .64 .62 .61 .50 .67 .88 .95 1.08 1.25 Other n.a. 1.56 1.49 1.51 1.54 1.71 2.24 2.48 2.98 3.01 Equity2 n.a. .39 .41 .45 .50 .55 .61 .66 .34 .31 Trading account 2.87 2.71 2.55 2.81 3.16 2.90 2.06 2.43 2.72 2.97 Gross federal funds sold and reverse RPs 4.27 3.82 3.93 3.82 5.18 5.37 4.61 4.12 5.11 4.81 Interest-bearing balances at depositories 3.18 2.90 2.73 2.66 2.86 2.69 2.68 2.52 2.90 2.52 Non-interest-earning assets 10.94 12.89 13.03 12.62 12.85 13.23 12.95 12.83 13.47 13.54 Revaluation gains held in trading accounts3 n.a. 2.95 2.90 2.25 2.59 2.95 2.57 2.29 2.37 2.42 Other 10.94 9.94 10.12 10.38 10.26 10.28 10.38 10.54 11.10 11.12 Liabilities 92.15 92.12 91.99 91.73 91.57 91.51 91.51 91.58 91.24 90.85 Interest-bearing liabilities 73.92 71.86 71.86 71.62 71.36 71.32 72.51 73.30 72.46 71.22 Deposits 60.26 57.34 56.31 55.87 55.01 54.66 54.79 54.67 54.60 53.90 In foreign offices 8.32 9.39 10.28 10.01 10.02 10.15 10.46 10.92 10.18 8.92 In domestic offices 51.94 47.96 46.03 45.86 44.99 44.51 44.33 43.75 44.43 44.98 Other checkable deposits 8.24 7.80 6.63 4.75 3.62 3.11 2.81 2.46 2.36 2.39 Savings (including MMDAs) 20.91 19.60 17.48 18.71 19.12 19.91 21.00 20.64 22.29 24.93 Small-denomination time deposits 16.98 15.33 16.15 15.97 15.17 14.15 13.10 12.49 11.59 10.13 Large-denomination time deposits 5.81 5.23 5.77 6.42 7.08 7.33 7.42 8.16 8.19 7.52 Gross federal funds purchased and RPs 7.47 7.60 7.71 7.18 8.13 7.99 7.97 7.83 7.95 7.77 Other 6.19 6.92 7.85 8.56 8.21 8.68 9.75 10.79 9.90 9.54 Non-interest-bearing liabilities 18.23 20.26 20.13 20.11 20.21 20.18 19.00 18.28 18.78 19.63 Demand deposits in domestic offices 13.86 13.49 12.68 12.82 12.16 11.00 9.78 8.62 8.00 7.66 Revaluation losses held in trading accounts3 .. n.a. 2.69 2.88 2.14 2.64 2.97 2.52 2.29 2.21 2.09 Other 4.37 4.55 4.57 5.14 5.42 6.21 6.70 7.37 8.58 9.88 Capital account 7.85 7.88 8.01 8.27 8.43 8.49 8.49 8.42 8.76 9.15 MEMO Commercial real estate loans 10.63 9.94 9.83 9.92 9.99 10.12 10.87 11.58 12.08 12.56 Other real estate owned .63 .36 .19 .14 .11 .08 .06 .05 .05 .06 Managed liabilities 28.28 29.61 32.08 32.73 34.09 34.94 36.58 38.82 37.41 35.05 Average net consolidated assets (billions of dollars) 3,566 3,863 4,148 4,376 4,733 5,144 5,439 5,905 6,333 6,633 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 2002 261 A. 1.—Continued A. All banks Item 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Effective interest rate (percent)4 Rates earned Interest-earning assets 7.61 7.61 8.33 8.14 8.15 7.99 7.70 8.23 7.37 6.09 Taxable equivalent 7.71 7.70 8.40 8.22 8.22 8.06 7.76 8.27 7.45 6.18 Loans and leases, gross 8.69 8.62 9.25 9.00 9.01 8.84 8.48 9.01 8.17 6.92 Net of loss provisions 8.08 8.32 8.93 8.56 8.50 8.30 7.97 8.33 7.16 5.88 Securities 6.12 5.97 6.51 6.46 6.54 6.45 6.27 6.48 6.09 4.99 Taxable equivalent 6.36 6.20 6.73 6.66 6.73 6.63 6.46 6.65 6.27 5.15 Investment account 6.11 5.80 6.35 6.39 6.50 6.38 6.25 6.45 6.06 5.05 U.S. Treasury securities and U.S. government agency obligations (excluding MBS) n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 5.76 4.43 Mortgage-backed securities n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 6.47 5.45 Other n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 5.59 4.74 Trading account 6.16 7.41 7.73 6.86 6.75 6.85 6.47 6.63 6.34 4.59 Gross federal funds sold and reverse RPs — 3.04 4.26 5.63 5.21 5.45 5.29 4.78 5.56 3.87 1.93 Interest-bearing balances at depositories 6.61 5.71 6.84 6.20 6.23 6.32 5.95 6.48 4.01 2.79 4.01 4.01 4.99 4.82 4.92 4.88 4.47 5.17 4.16 2.55 Interest-bearing liabilities Interest-bearing deposits 3.65 3.53 4.47 4.34 4.39 4.31 3.87 4.45 3.62 2.12 In foreign offices 6.82 5.59 6.12 5.54 5.44 5.66 4.91 5.61 3.95 2.38 In domestic offices 3.14 3.14 4.11 4.07 4.16 4.01 3.63 4.18 3.55 2.07 Other checkable deposits 1.99 1.85 2.06 2.04 2.25 2.29 2.08 2.34 1.96 1.06 Savings (including MMDAs) 2.50 2.58 3.19 3.00 2.93 2.79 2.49 2.86 2.19 1.13 Large time deposits5 4.00 4.09 5.47 5.39 5.45 5.22 4.92 5.78 5.05 3.38 Other time deposits5 4.19 4.17 5.44 5.40 5.54 5.48 5.09 5.69 5.44 3.74 Gross federal funds purchased and RPs 3.07 4.18 5.65 5.12 5.17 5.19 4.73 5.77 3.84 1.88 Other interest-bearing liabilities 8.02 7.25 7.47 6.93 6.94 6.89 6.48 6.97 5.93 4.32 Income and expense as a percentage of average net consolidated assets Gross interest income 6.86 6.65 7.29 7.16 7.15 6.98 6.73 7.19 6.40 5.29 Taxable equivalent 6.94 6.73 7.35 7.21 7.20 7.03 6.78 7.23 6.44 5.33 Loans 5.00 4.91 5.48 5.47 5.40 5.27 5.12 5.54 4.93 4.08 Securities 1.37 1.25 1.23 1.16 1.11 1.10 1.14 1.15 1.00 .90 Gross federal funds sold and reverse RPs .13 .17 .23 .21 .29 .29 .23 .23 .20 .09 Other .36 .33 .35 .32 .35 .32 .24 .27 .24 .18 Gross interest expense 2.96 2.87 3.57 3.43 3.48 3.46 3.22 3.76 2.98 1.80 Deposits 2.23 2.05 2.54 2.46 2.48 2.43 2.20 2.56 2.09 1.24 Gross federal funds purchased and RPs .24 .32 .44 .38 .43 .43 .39 .45 .31 .15 Other .50 .50 .58 .59 .56 .59 .63 .75 .58 .41 Net interest income 3.90 3.78 3.72 3.73 3.67 3.52 3.52 3.43 3.42 3.50 Taxable equivalent 3.98 3.86 3.79 3.78 3.72 3.57 3.57 3.47 3.46 3.54 Loss provisioning6 .47 .28 .30 .37 .41 .41 .39 .50 .68 .68 Non-interest income 2.13 2.00 2.02 2.18 2.23 2.40 2.65 2.58 2.51 2.53 Service charges on deposits .42 .40 .39 .39 .39 .38 .40 .40 .42 .45 Fiduciary activities .31 .31 .31 .33 .35 .37 .38 .38 .35 .33 Trading revenue .26 .16 .15 .17 .17 .15 .19 .21 .20 .16 Interest rate exposures n.a. n.a. n.a. .09 .08 .05 .07 .08 .10 .08 Foreign exchange rate exposures n.a. n.a. n.a. .06 .08 .09 .09 .09 .07 .07 Other commodity and equity exposures n.a. n.a. n.a. .02 « .01 .03 .04 .03 .01 Other 1.14 1.13 1.17 1.29 1.32 1.49 1.69 1.59 1.55 1.59 Non-interest expense 3.94 3.75 3.64 3.71 3.61 3.77 3.76 3.65 3.56 3.46 Salaries, wages, and employee benefits 1.64 1.58 1.54 1.55 1.53 1.55 1.58 1.51 1.49 1.52 Occupancy .52 .49 .48 .48 .47 .47 .48 .45 .44 .44 Other 1.78 1.68 1.62 1.69 1.62 1.75 1.70 1.69 1.63 1.50 Net non-interest expense 1.81 1.75 1.62 1.53 1.38 1.37 1.11 1.07 1.04 .93 Gains on investment account securities .09 .01 .01 .03 .04 .06 * -.04 .07 .10 Income before taxes and extraordinary items — 1.70 1.73 1.81 1.85 1.92 1.80 2.02 1.81 1.77 1.98 Taxes .56 .58 .63 .65 .68 .62 .72 .63 .59 .65 Extraordinary items, net of income taxes .06 * * * * .01 * * -.01 * Net income 1.20 1.15 1.18 1.20 1.25 1.19 1.31 1.18 1.17 1.33 Cash dividends declared .62 .73 .75 .90 .90 .80 .96 .89 .87 1.01 Retained income .58 .42 .43 .30 .35 .39 .35 .29 .30 .31 MEMO: Return on equity 15.32 14.63 14.69 14.53 14.84 14.06 15.40 13.96 13.39 14.51 * In absolute value, less than 0.005 percent. n.a. Not available. MMDA Money market deposit account. RP Repurchase agreement. CD Certificate of deposit. 1. Includes allocated transfer risk reserves. 2. As in the Call Report, equity securities are combined with "other debt securities" before 1989. 3. Before 1994, the netted value of off-balance-sheet items appeared in "trading account securities" if a gain and "other non-interest-bearing liabilities" if a loss. 4. When possible, based on the average of quarterly balance sheet data reported on schedule RC-K of the quarterly Call Reports. 5. Before 1997, large time open accounts included in other time deposits. 6. Includes provisions for allocated transfer risk. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

262 Federal Reserve Bulletin • June 2003 A.l. Portfolio composition, interest rates, and income and expense, all U.S. banks, 1993-2002 B. Ten largest banks by assets Item 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Balance sheet items as a percentage of average net consolidated assets Interest-earning assets 84.90 77.26 77.12 80.12 81.84 81.25 81.49 82.23 81.74 81.68 Loans and leases, net 55.57 49.91 50.05 53.51 50.91 50.76 53.37 55.22 53.86 53.60 Commercial and industrial 18.65 16.43 16.16 17.17 16.90 18.07 19.20 19.87 18.82 16.16 U.S. addressees 10.75 9.16 8.66 9.59 10.24 11.76 13.14 13.95 13.42 11.70 Foreign addressees 7.90 7.27 7.50 7.59 6.66 6.31 6.06 5.92 5.41 4.47 Consumer 7.33 6.59 6.60 6.22 6.40 6.04 5.94 5.43 6.17 7.82 Credit card 2.50 2.28 1.96 1.23 1.34 1.30 1.36 1.34 1.64 2.90 Installment and other 4.83 4.31 4.65 4.99 5.06 4.74 4.58 4.09 4.53 4.92 Real estate 18.54 16.21 15.82 16.53 17.42 16.51 16.96 19.82 19.23 20.78 In domestic offices 15.99 13.80 13.48 14.44 15.69 15.08 15.55 18.48 18.05 19.70 Construction and land development 1.59 .84 .58 .51 .68 .77 .90 .98 1.27 1.42 Farmland .07 .06 .06 .06 .09 .09 .10 .11 .11 .12 One- to four-family residential 10.29 9.69 9.62 10.43 11.02 10.33 10.77 13.37 12.41 13.51 Home equity 1.60 1.40 1.40 1.53 1.70 1.72 1.54 1.61 1.78 2.35 Other 8.68 8.29 8.22 8.90 9.31 8.61 9.22 11.76 10.63 11.17 Multifamily residential .53 .41 .38 .38 .39 .38 .43 .60 .51 .55 Nonfarm nonresidential 3.51 2.79 2.83 3.05 3.52 3.51 3.35 3.42 3.76 4.09 In foreign offices 2.55 2.41 2.35 2.09 1.73 1.43 1.41 1.34 1.18 1.08 To depository institutions and acceptances of other banks 2.47 3.49 5.04 6.14 4.20 4.05 4.34 3.78 3.23 3.20 Foreign governments 2.46 1.27 .90 .69 .45 .35 .38 .28 .20 .20 Agricultural production .27 .25 .21 .23 .31 .28 .26 .23 .28 .23 Other loans 6.71 6.32 5.76 6.34 4.15 3.74 3.96 3.75 3.51 2.94 Lease-financing receivables 1.30 1.14 1.14 1.59 2.24 2.81 3.40 3.07 3.43 3.44 LESS: Unearned income on loans -.21 -.16 -.14 -.11 -.07 -.06 -.05 -.04 -.04 -.08 LESS: Loss reserves1 -1.94 -1.63 -1.45 -1.30 -1.08 -1.01 -1.03 -.97 -.97 -1.12 Securities 22.74 20.61 19.53 19.83 20.00 19.72 18.34 18.98 17.81 20.54 Investment account 12.45 11.68 10.65 10.60 10.97 12.12 13.08 13.71 12.14 14.36 Debt 12.45 10.10 9.03 8.94 9.42 10.58 11.38 11.97 11.30 13.62 U.S. Treasury n.a. 2.06 2.03 1.93 1.56 1.70 1.98 1.96 .68 .59 U.S. government agency and corporation obligations n.a. 5.08 4.46 4.59 5.34 6.31 6.35 6.59 6.84 8.68 Government-backed mortgage pools ... n.a. 2.79 2.89 3.58 4.26 5.13 5.03 4.88 4.99 6.38 Collateralized mortgage obligations n.a. 2.22 1.50 .95 .93 .93 .79 .93 1.11 1.52 Other n.a. .06 .08 .06 .15 .26 .52 .78 .74 .79 State and local government n.a. .61 .49 .39 .51 .47 .45 .51 .55 .59 Private mortgage-backed securities n.a. .43 .32 .30 .32 .60 .57 .51 .58 .93 Other n.a. 3.03 2.97 3.01 2.81 2.57 3.22 3.47 3.22 3.34 Equity2 n.a. .39 .38 .38 .42 .47 .51 .68 .26 .22 Trading account 10.30 8.93 8.88 9.23 9.03 7.60 5.25 5.26 5.67 6.18 Gross federal funds sold and reverse RPs 2.71 2.68 3.20 3.10 7.56 7.81 6.64 5.02 6.38 5.26 Interest-bearing balances at depositories 3.88 4.05 4.34 3.68 3.37 2.96 3.14 3.01 3.69 2.28 Non-interest-earning assets 15.10 22.74 22.88 19.88 18.16 18.75 18.51 17.77 18.26 18.32 Revaluation gains held in trading accounts 3 n.a. 11.23 10.77 7.63 7.36 7.62 6.66 5.66 5.47 5.40 Other 15.10 11.51 12.11 12.25 10.80 11.13 11.85 12.11 12.78 12.93 Liabilities 93.24 93.42 93.59 93.04 92.61 92.58 92.28 92.36 92.14 91.52 Interest-bearing liabilities 71.56 64.33 63.37 64.45 65.83 65.81 66.87 67.81 66.76 65.43 Deposits 52.91 48.20 47.49 47.87 47.36 47.65 48.79 49.27 49.09 48.97 In foreign offices 25.51 26.10 28.36 26.41 22.18 20.17 21.04 21.62 19.22 16.26 In domestic offices 27.41 22.10 19.12 21.46 25.18 27.48 27.76 27.66 29.88 32.71 Other checkable deposits 3.45 2.91 2.30 1.61 1.21 .99 .72 .74 .90 .95 Savings (including MMDAs) 15.33 12.70 10.56 12.31 14.26 15.83 16.84 16.73 19.24 22.82 Small-denomination time deposits 5.09 3.98 4.04 4.68 5.82 6.03 5.66 5.38 5.11 4.72 Large-denomination time deposits 3.53 2.51 2.23 2.86 3.89 4.62 4.54 4.80 4.63 4.22 Gross federal funds purchased and RPs 6.70 5.83 6.17 5.88 10.26 9.78 8.84 8.89 9.04 8.83 Other 11.94 10.29 9.71 10.69 8.20 8.37 9.24 9.65 8.62 7.63 Non-interest-bearing liabilities 21.68 29.09 30.22 28.59 26.78 26.77 25.41 24.56 25.38 26.09 Demand deposits in domestic offices 11.27 10.15 8.88 9.73 8.98 8.46 7.83 7.28 7.50 7.40 Revaluation losses held in trading accounts3 .. n.a. 10.22 10.68 7.27 7.53 7.67 6.51 5.69 5.10 4.63 Other 10.41 10.51 10.66 11.59 10.27 10.65 11.06 11.59 12.78 14.07 Capital account 6.76 6.58 6.41 6.96 7.39 7.42 7.72 7.64 7.86 8.48 MEMO Commercial real estate loans 6.46 4.65 4.40 4.65 5.45 5.61 5.69 5.87 6.68 6.92 Other real estate owned 1.02 .58 .27 .18 .13 .09 .06 .04 .04 .03 Managed liabilities 49.23 46.21 47.94 47.39 46.02 44.42 45.49 46.84 43.41 38.89 Average net consolidated assets (billions of dollars) 818 949 1,051 1,189 1,514 1,820 1,935 2,234 2,527 2,785 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 2002 263 A.l.—Continued B. Ten largest banks by assets Item 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Effective interest rate (percent)4 Rates earned Interest-earning assets 8.16 8.15 8.20 7.72 7.55 7.54 7.35 7.77 6.83 5.81 Taxable equivalent 8.20 8.18 8.22 7.74 7.60 7.57 7.39 7.78 6.90 5.89 Loans and leases, gross 9.07 8.89 8.84 8.32 8.25 8.21 7.99 8.46 7.52 6.54 Net of loss provisions 8.23 8.66 8.88 8.31 8.10 7.77 7.65 7.92 6.56 5.32 Securities 6.68 7.09 7.40 6.80 6.78 6.83 6.58 6.48 6.36 5.14 Taxable equivalent 6.77 7.19 7.47 6.85 6.85 6.89 6.65 6.55 6.44 5.21 Investment account 6.88 6.57 7.04 6.70 6.76 6.78 6.59 6.40 6.23 5.30 U.S. Treasury securities and U.S. government agency obligations (excluding MBS) n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 5.02 3.74 Mortgage-backed securities n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 6.42 5.55 Other n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 6.34 5.30 Trading account 6.45 7.79 7.83 6.90 6.81 6.92 6.56 6.70 6.66 4.75 Gross federal funds sold and reverse RPs 3.02 4.52 5.20 4.92 5.45 5.20 4.52 4.93 3.86 2.20 Interest-bearing balances at depositories 8.34 7.27 7.15 6.71 6.91 7.16 7.22 7.43 3.73 3.40 Rates paid Interest-bearing liabilities 5.60 5.43 5.88 5.44 5.41 5.29 4.79 5.37 4.09 2.55 Interest-bearing deposits 4.50 4.32 4.99 4.57 4.54 4.40 3.82 4.40 3.27 1.95 In foreign offices 6.87 6.04 6.07 5.62 5.52 5.83 4.99 5.67 4.02 2.59 In domestic offices 2.36 2.35 3.42 3.32 3.69 3.39 3.04 3.51 2.85 1.68 Other checkable deposits 1.28 1.10 1.29 1.32 1.97 1.67 1.44 1.61 1.67 .93 Savings (including MMDAs) 2.14 2.35 3.11 2.76 2.68 2.45 2.11 2.43 1.92 1.02 Large time deposits5 3.55 3.12 3.73 4.62 5.17 4.53 4.36 5.32 4.40 3.26 Other time deposits5 3.01 2.80 5.08 4.58 5.45 5.21 4.95 5.53 5.15 3.55 Gross federal funds purchased and RPs 3.26 4.05 5.22 4.93 5.02 5.18 4.53 5.47 3.81 2.02 Other interest-bearing liabilities 11.16 10.87 9.80 8.86 9.13 8.85 8.61 8.15 7.00 5.39 Income and expense as a percentage of average net consolidated assets Gross interest income 7.22 6.37 6.42 6.26 6.31 6.21 6.01 6.39 5.56 4.78 Taxable equivalent 7.25 6.40 6.43 6.27 6.33 6.22 6.03 6.41 5.58 4.80 Loans 5.22 4.49 4.44 4.48 4.31 4.27 4.35 4.74 4.14 3.58 Securities .86 .77 .75 .71 .73 .81 .85 .88 .72 .73 Gross federal funds sold and reverse RPs .11 .15 .21 .18 .45 .42 .30 .25 .25 .12 Other 1.04 .97 1.00 .88 .82 .70 .51 .51 .43 .34 Gross interest expense 4.06 3.52 3.74 3.52 3.55 3.48 3.16 3.60 2.69 1.65 Deposits 2.48 2.15 2.43 2.26 2.26 2.20 1.97 2.33 1.74 1.06 Gross federal funds purchased and RPs .24 .24 .35 .31 .54 .54 .40 .49 .35 .18 Other 1.35 1.13 .95 .95 .75 .74 .79 .78 .59 .41 Net interest income 3.16 2.86 2.68 2.73 2.76 2.73 2.84 2.78 2.87 3.13 Taxable equivalent 3.19 2.88 2.70 2.75 2.79 2.75 2.86 2.80 2.89 3.15 Loss provisioning6 .64 .26 .11 .11 .16 .31 .26 .38 .59 .73 Non-interest income 2.99 2.33 2.16 2.34 2.12 2.15 2.55 2.54 2.23 2.32 Service charges on deposits .30 .26 .25 .28 .32 .33 .37 .40 .44 .48 Fiduciary activities .39 .36 .30 .31 .34 .32 .31 .27 .29 .26 Trading revenue .91 .53 .46 .52 .43 .33 .46 .48 .43 .32 Interest rate exposures n.a. n.a. n.a. .30 .23 .10 .17 .20 .21 .15 Foreign exchange rate exposures n.a. n.a. n.a. .17 .20 .20 .19 .18 .14 .14 Other commodity and equity exposures n.a. n.a. n.a. .05 * .03 .09 .11 .08 .03 Other 1.38 1.18 1.15 1.23 1.04 1.17 1.41 1.39 1.07 1.26 Non-interest expense 4.13 3.56 3.32 3.57 3.24 3.47 3.45 3.31 3.13 3.15 Salaries, wages, and employee benefits 1.88 1.65 1.58 1.57 1.45 1.45 1.57 1.46 1.38 1.41 Occupancy .66 .55 .50 .50 .47 .47 .50 .47 .45 .46 Other 1.59 1.36 1.24 1.50 1.33 1.54 1.38 1.39 1.30 1.28 Net non-interest expense 1.14 1.23 1.16 1.23 1.12 1.32 .90 .77 .90 .84 Gains on investment account securities .13 .02 .03 .04 .08 .11 .03 -.03 .08 .13 Income before taxes and extraordinary items 1.50 1.39 1.44 1.44 1.56 1.22 1.71 1.60 1.46 1.69 Taxes .53 .48 .55 .52 .58 .44 .66 .60 .48 .57 Extraordinary items, net of income taxes .16 * * * * * * * -.01 « Net income 1.13 .91 .88 .92 .98 .78 1.05 1.00 .97 1.12 Cash dividends declared .28 .58 .57 .70 .82 .53 .79 .86 .67 1.05 Retained income .85 .33 .31 .21 .15 .25 .26 .13 .31 .07 MEMO: Return on equity 16.75 13.86 13.78 13.21 13.22 10.53 13.58 13.04 12.38 13.24 * In absolute value, less than 0.005 percent. n.a. Not available. MMDA Money market deposit account. RP Repurchase agreement. CD Certificate of deposit. 1. Includes allocated transfer risk reserves. 2. As in the Call Report, equity securities are combined with "other debt securities" before 1989. 3. Before 1994, the netted value of off-balance-sheet items appeared in "trading account securities" if a gain and "other non-interest-bearing liabilities" if a loss. 4. When possible, based on the average of quarterly balance sheet data reported on schedule RC-K of the quarterly Call Reports. 5. Before 1997, large time open accounts included in other time deposits. 6. Includes provisions for allocated transfer risk. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

264 Federal Reserve Bulletin • June 2003 A.l. Portfolio composition, interest rates, and income and expense, all U.S. banks, 1993-2002 C. Banks ranked 11 through 100 by assets Item 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Balance sheet items as a percentage of average net consolidated assets Interest-earning assets 88.81 88.58 88.71 88.26 87.50 87.91 88.47 88.78 88.22 88.48 Loans and leases, net 57.33 58.56 62.68 64.24 63.89 64.42 64.28 64.97 62.27 60.13 Commercial and industrial 18.03 18.03 19.26 18.95 19.01 18.92 19.40 18.20 15.85 13.29 U.S. addressees 17.05 16.99 18.10 17.71 17.78 17.59 18.18 17.65 15.37 12.96 Foreign addressees .98 1.04 1.16 1.24 1.22 1.33 1.22 .55 .48 .33 Consumer 11.47 12.62 14.23 15.67 15.62 14.53 13.57 13.80 13.20 12.79 Credit card 5.23 5.99 7.34 8.26 8.50 7.67 6.78 6.98 6.97 6.57 Installment and other 6.24 6.63 6.89 7.40 7.12 6.86 6.79 6.82 6.23 6.22 Real estate 22.11 22.26 23.25 23.26 22.99 24.60 24.81 26.23 27.31 28.96 In domestic offices 22.01 22.17 23.10 23.10 22.85 24.42 24.63 26.13 27.22 28.90 Construction and land development 2.08 1.63 1.50 1.55 1.69 2.03 2.43 3.00 3.31 3.36 Farmland .13 .14 .13 .13 .14 .17 .19 .22 .23 .22 One- to four-family residential 12.30 12.98 14.16 14.15 13.88 14.86 14.15 14.52 15.52 17.06 Home equity 2.54 2.33 2.19 2.08 2.22 2.17 2.08 2.49 2.90 3.89 Other 9.76 10.65 11.97 12.07 11.65 12.69 12.07 12.03 12.61 13.17 Multifamily residential .71 .71 .77 .89 .93 1.00 1.02 1.11 1.16 1.20 Nonfarm nonresidential 6.79 6.72 6.54 6.37 6.21 6.36 6.82 7.28 7.00 7.05 In foreign offices .10 .09 .15 .16 .15 .18 .19 .09 .09 .06 To depository institutions and acceptances of other banks 1.34 1.52 1.61 1.53 1.30 1.09 .93 1.05 1.40 1.44 Foreign governments .30 .28 .20 .20 .09 .06 .06 .03 .03 .02 Agricultural production .29 .29 .26 .28 .29 .33 .33 .37 .32 .27 Other loans 4.01 3.45 3.29 3.27 3.18 3.35 2.99 2.57 2.03 1.79 Lease-financing receivables 1.47 1.60 1.96 2.41 2.70 2.75 3.32 3.87 3.28 2.75 LESS: Unearned income on loans -.11 -.07 -.07 -.06 -.05 -.04 -.04 -.03 -.02 -.02 LESS: Loss reserves' -1.60 -1.41 -1.32 -1.27 -1.24 -1.16 -1.11 -1.12 -1.13 -1.17 Securities 21.97 21.19 18.64 16.87 15.80 16.67 17.80 17.33 19.01 20.30 Investment account 20.60 19.82 17.88 16.06 15.07 16.13 17.29 16.11 17.71 19.16 Debt 20.60 18.57 16.60 14.70 13.61 14.52 15.53 14.19 16.72 18.20 U.S. Treasury n.a. 6.86 4.82 3.34 2.81 2.25 1.70 1.12 .67 .74 U.S. government agency and corporation obligations n.a. 9.38 9.40 9.12 8.98 9.93 10.58 9.71 10.09 11.45 Government-backed mortgage pools ... n.a. 5.40 5.06 5.42 5.17 4.98 5.12 4.31 5.19 6.00 Collateralized mortgage obligations n.a. 3.04 2.82 2.16 2.13 2.83 2.89 2.55 2.42 2.79 Other n.a. .94 1.51 1.54 1.68 2.12 2.56 2.84 2.48 2.65 State and local government n.a. 1.20 1.11 .99 .88 .92 .99 .96 .99 .97 Private mortgage-backed securities n.a. .95 1.02 .96 .73 .96 1.35 1.66 2.01 2.13 Other n.a. 1.22 1.16 1.21 1.18 1.53 2.02 2.06 3.56 3.53 Equity2 n.a. .32 .37 .44 .49 .55 .65 .60 .39 .34 Trading account 1.37 1.38 .76 .80 .73 .54 .51 1.22 1.30 1.14 Gross federal funds sold and reverse RPs 4.98 5.11 4.52 4.26 4.38 3.57 3.34 3.76 4.07 4.71 Interest-bearing balances at depositories 4.53 3.72 2.87 2.89 3.43 3.24 3.06 2.71 2.88 3.33 Non-interest-earning assets 11.19 11.42 11.29 11.74 12.50 12.09 11.53 11.22 11.78 11.52 Revaluation gains held in trading accounts3 n.a. .60 .50 .51 .69 .75 .57 .41 .55 .47 Other 11.19 10.81 10.78 11.23 11.81 11.34 10.96 10.81 11.23 11.05 Liabilities 92.56 92.47 92.23 92.02 91.85 91.63 91.65 91.56 91.14 90.77 Interest-bearing liabilities 73.38 72.86 74.05 73.14 72.60 73.40 74.95 76.44 75.96 74.75 Deposits 54.22 53.03 52.32 51.81 51.45 51.51 51.51 51.60 51.97 50.57 In foreign offices 6.78 8.05 8.12 7.52 7.85 8.15 7.97 7.35 6.86 6.10 In domestic offices 47.43 44.98 44.20 44.30 43.60 43.36 43.55 44.26 45.11 44.47 Other checkable deposits 7.21 6.91 5.62 3.06 1.95 1.75 1.60 1.32 1.20 1.17 Savings (including MMDAs) 20.60 20.13 18.78 20.76 21.08 21.41 22.47 22.35 24.37 26.50 Small-denomination time deposits 14.19 13.26 14.24 14.09 13.43 12.84 11.86 11.80 10.67 8.78 Large-denomination time deposits 5.44 4.68 5.55 6.39 7.15 7.36 7.62 8.78 8.87 8.02 Gross federal funds purchased and RPs 11.93 11.48 11.37 10.00 9.36 9.48 9.78 9.28 9.72 9.67 Other 7.23 8.34 10.36 11.32 11.79 12.41 13.67 15.56 14.27 14.51 Non-interest-bearing liabilities 19.18 19.62 18.18 18.89 19.24 18.23 16.70 15.12 15.18 16.02 Demand deposits in domestic offices 15.38 15.27 14.26 14.47 14.17 12.40 10.52 8.62 7.17 6.31 Revaluation losses held in trading accounts3 .. n.a. .57 .49 .49 .68 .76 .58 .41 .52 .44 Other 3.80 3.89 3.43 3.93 4.39 5.07 5.59 6.09 7.49 9.27 Capital account 7.44 7.53 7.77 7.98 8.15 8.37 8.35 8.44 8.86 9.23 MEMO Commercial real estate loans 10.29 9.69 9.42 9.38 9.44 10.11 11.00 12.07 12.06 12.23 Other real estate owned .47 .25 .13 .08 .06 .04 .03 .03 .04 .05 Managed liabilities 31.76 32.89 35.68 35.60 36.60 38.09 39.81 41.94 40.78 39.48 Average net consolidated assets (billions of dollars) 1,082 1,204 1,338 1,450 1,604 1,745 1,880 2,030 2,129 2,123 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 2002 265 A. 1.—Continued C. Banks ranked 11 through 100 by assets Item 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Effective interest rate (percent)4 Rates earned Interest-earning assets 7.35 7.29 8.31 8.16 8.31 8.10 7.84 8.47 7.54 6.01 Taxable equivalent 7.45 7.37 8.37 8.23 8.36 8.17 7.88 8.49 7.59 6.09 Loans and leases, gross 8.25 8.22 9.10 8.88 9.03 8.82 8.50 9.15 8.27 6.81 Net of loss provisions 7.66 7.87 8.67 8.21 8.27 8.15 7.81 8.27 6.97 5.61 Securities 6.13 5.75 6.38 6.49 6.55 6.31 6.32 6.64 5.94 4.78 Taxable equivalent 6.32 5.92 6.56 6.66 6.70 6.46 6.46 6.77 6.07 4.90 Investment account 6.22 5.75 6.35 6.49 6.57 6.33 6.34 6.66 6.02 4.85 U.S. Treasury securities and U.S. government agency obligations (excluding MBS) n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 55..8833 44..2288 Mortgage-backed securities n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 6.58 5.33 Other n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 5.10 4.20 Trading account 4.74 5.75 7.27 6.53 6.05 5.86 5.58 6.25 4.83 3.59 Gross federal funds sold and reverse RPs — 3.11 4.31 5.91 5.31 5.45 5.46 5.12 6.06 3.85 1.68 Interest-bearing balances at depositories 6.50 4.69 6.78 5.82 5.76 5.67 4.81 5.49 4.38 2.46 Rates paid Interest-bearing liabilities 3.76 3.72 4.94 4.70 4.79 4.76 4.38 5.22 4.15 2.40 Interest-bearing deposits 3.51 3.25 4.35 4.15 4.22 4.15 3.76 4.42 3.60 1.96 In foreign offices 7.37 4.60 6.30 5.29 5.23 5.22 4.70 5.38 3.67 1.70 In domestic offices 2.98 3.03 4.01 3.96 4.04 3.96 3.60 4.26 3.60 1.99 Other checkable deposits 1.70 1.62 1.89 1.78 2.01 2.41 2.03 2.57 2.32 .94 Savings (including MMDAs) 2.33 2.46 3.10 2.91 2.84 2.76 2.49 2.94 2.30 1.08 Large time deposits5 4.30 4.21 5.70 5.50 5.47 5.32 4.96 5.88 5.11 3.37 Other time deposits5 4.06 4.18 5.35 5.26 5.43 5.35 5.03 5.73 5.42 3.67 Gross federal funds purchased and RPs 3.04 4.28 5.86 5.19 5.29 5.22 4.87 6.02 3.86 1.73 Other interest-bearing liabilities 5.97 5.24 6.43 5.95 5.85 5.81 5.41 6.36 5.30 3.53 Income and expense as a percentage of average net consolidated assets Gross interest income 6.58 6.46 7.40 7.24 7.26 7.16 6.99 7.56 6.72 5.33 Taxable equivalent 6.64 6.51 7.45 7.28 7.30 7.20 7.02 7.59 6.75 5.36 Loans 4.84 4.91 5.79 5.80 5.87 5.79 5.57 6.07 5.30 4.17 Securities 1.26 1.13 1.13 1.03 .98 1.00 1.10 1.09 1.06 .90 Gross federal funds sold and reverse RPs — .15 .21 .27 .23 .22 .19 .18 .22 .15 .08 Other .32 .21 .21 .18 .19 .18 .14 .18 .15 .11 Gross interest expense 2.74 2.67 3.62 3.39 3.41 3.45 3.26 3.96 3.14 1.77 Deposits 1.93 1.73 2.29 2.18 2.23 2.23 2.02 2.41 2.01 1.09 Gross federal funds purchased and RPs .38 .51 .67 .55 .51 .51 .51 .56 .38 .17 Other .43 .43 .66 .66 .68 .71 .73 .98 .75 .50 Net interest income 3.84 3.79 3.78 3.84 3.85 3.71 3.72 3.60 3.58 3.56 Taxable equivalent 3.91 3.85 3.84 3.89 3.89 3.75 3.76 3.63 3.61 3.60 Loss provisioning6 .47 .32 .39 .54 .60 .53 .54 .68 .91 .80 Non-interest income 2.29 2.25 2.38 2.61 2.76 3.07 3.35 3.14 3.30 3.26 Service charges on deposits .46 .45 .44 .44 .44 .42 .42 .42 .42 .42 Fiduciary activities .38 .39 .40 .43 .44 .49 .48 .52 .42 .42 Trading income .14 .08 .09 .08 .08 .09 .08 .08 .08 .08 Interest rate exposures n.a. n.a. n.a. .03 .02 .03 .02 .02 .04 .04 Foreign exchange rate exposures n.a. n.a. n.a. .04 .05 .06 .06 .05 .03 .04 Other commodity and equity exposures n.a. n.a. n.a. .01 * • * * * * Other 1.32 1.33 1.45 1.67 1.79 2.07 2.37 2.13 2.38 2.33 Non-interest expense 3.95 3.86 3.79 3.85 3.85 4.03 4.11 3.97 3.91 3.69 Salaries, wages, and employee benefits 1.52 1.50 1.47 1.51 1.51 1.53 1.53 1.44 1.47 1.49 Occupancy .47 .47 .47 .48 .46 .46 .45 .43 .42 .40 Other 1.95 1.89 1.85 1.86 1.88 2.04 2.13 2.10 2.03 1.79 Net non-interest expense 1.65 1.61 1.41 1.24 1.10 .96 .76 .83 .61 .43 Gains on investment account securities .09 -.01 .02 .02 .02 .03 -.01 -.05 .09 .10 Income before taxes and extraordinary items 1.81 1.85 2.01 2.09 2.18 2.24 2.41 2.04 2.15 2.43 Taxes .56 .63 .70 .75 .77 .79 .87 .70 .74 .83 Extraordinary items, net of income taxes * * * * * * • * * * Net income 1.25 1.22 1.31 1.34 1.42 1.46 1.54 1.33 1.40 1.60 Cash dividends declared .76 .86 .85 1.07 .93 .96 1.16 .94 .96 .99 Retained income .49 .36 .46 .26 .48 .50 .38 .39 .44 .61 MEMO: Return on equity 16.86 16.27 16.84 16.78 17.36 17.38 18.48 15.79 15.80 17.38 * In absolute value, less than 0.005 percent. n.a. Not available. MMDA Money market deposit account. RP Repurchase agreement. CD Certificate of deposit. 1. Includes allocated transfer risk reserves. 2. As in the Call Report, equity securities are combined with "other debt securities" before 1989. 3. Before 1994, the netted value of off-balance-sheet items appeared in "trading account securities" if a gain and "other non-interest-bearing liabilities" if a loss. 4. When possible, based on the average of quarterly balance sheet data reported on schedule RC-K of the quarterly Call Reports. 5. Before 1997, large time open accounts included in other time deposits. 6. Includes provisions for allocated transfer risk. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

266 Federal Reserve Bulletin • June 2003 A.l. Portfolio composition, interest rates, and income and expense, all U.S. banks, 1993-2002 D. Banks ranked 101 through 1,000 by assets Item 1993 1994 1995 19% 1997 1998 1999 2000 2001 2002 Balance sheet items as a percentage of average net consolidated assets Interest-earning assets 90.45 90.90 90.97 91.10 91.32 91.36 91.68 91.50 91.16 91.37 Loans and leases, net 57.93 59.75 62.19 62.63 62.22 61.13 61.49 62.15 62.48 61.48 Commercial and industrial 12.19 12.07 12.70 12.79 12.43 12.48 12.64 12.95 13.04 12.38 U.S. addressees 12.03 11.91 12.54 12.61 12.19 12.16 12.32 12.60 12.65 12.07 Foreign addressees .16 .16 .16 .18 .23 .32 .32 .36 .39 .31 Consumer 14.82 15.84 16.27 15.88 14.03 12.28 10.79 10.19 9.76 8.14 Credit card 5.63 6.05 6.32 6.66 5.52 4.48 3.37 3.27 3.61 2.66 Installment and other 9.19 9.79 9.95 9.22 8.52 7.80 7.41 6.92 6.14 5.48 Real estate 28.61 29.42 30.81 31.37 33.23 33.94 35.90 36.93 37.65 38.92 In domestic offices 28.58 29.39 30.79 31.34 33.21 33.92 35.88 36.91 37.63 38.90 Construction and land development 2.26 2.08 2.21 2.38 2.69 2.88 3.49 4.15 4.90 5.40 Farmland .34 .36 .40 .46 .53 .56 .58 .65 .67 .73 One- to four-family residential 15.16 16.25 17.49 17.34 18.14 18.19 18.26 17.17 16.19 15.39 Home equity 2.51 2.33 2.36 2.30 2.30 2.15 1.99 2.10 2.20 2.51 Other 12.66 13.92 15.13 15.03 15.84 16.05 16.27 15.06 13.98 12.88 Multifamily residential 1.07 1.13 1.21 1.29 1.29 1.26 1.44 1.58 1.69 1.83 Nonfarm nonresidential 9.75 9.57 9.48 9.87 10.56 11.03 12.12 13.36 14.18 15.55 In foreign offices .02 .03 .02 .02 .02 .02 .02 .02 .02 .03 To depository institutions and acceptances of other banks .47 .42 .36 .50 .59 .53 .46 .37 .38 .37 Foreign governments .03 .02 .02 .02 .02 .03 .03 .03 .03 .02 Agricultural production .56 .62 .69 .71 .74 .80 .78 .82 .85 .86 Other loans 2.13 1.98 1.78 1.68 1.47 1.30 1.25 1.22 1.22 1.18 Lease-financing receivables .77 .83 .90 1.01 .99 .99 .78 .75 .74 .76 LESS: Unearned income on loans -.21 -.15 -.12 -.10 -.10 -.09 -.08 -.08 -.07 -.06 LESS: Loss reserves1 -1.44 -1.30 -1.22 -1.22 -1.18 -1.13 -1.06 -1.04 -1.12 -1.10 Securities 25.92 25.72 23.08 22.67 23.45 24.26 25.17 24.34 22.80 23.86 Investment account 25.63 25.40 22.88 22.55 23.35 24.15 25.09 24.25 22.69 23.80 Debt 25.63 23.94 21.32 20.71 20.92 21.15 21.70 20.30 20.57 21.80 U.S. Treasury n.a. 8.17 6.48 5.61 4.96 3.92 2.53 1.81 1.32 1.22 U.S. government agency and corporation obligations n.a. 12.76 12.23 12.66 13.97 15.13 16.29 15.56 14.69 15.87 Government-backed mortgage pools ... n.a. 5.64 5.42 5.69 6.22 6.46 6.72 6.22 6.26 6.57 Collateralized mortgage obligations n.a. 4.34 3.56 3.12 3.01 3.22 3.52 3.04 3.08 3.70 Other n.a. 2.79 3.25 3.85 4.73 5.44 6.05 6.30 5.35 5.60 State and local government n.a. 2.29 2.13 2.24 2.44 2.70 2.91 2.91 2.90 2.89 Private mortgage-backed securities n.a. .73 .68 .76 .59 .65 1.00 .99 .93 .99 Other n.a. .99 .89 .76 .78 1.06 1.60 2.19 2.42 2.33 Equity2 n.a. .43 .47 .52 .61 .69 .77 .79 .43 .50 Trading account .28 .31 .20 .12 .10 .11 .08 .09 .11 .06 Gross federal funds sold and reverse RPs 4.49 3.64 3.92 3.87 3.60 4.17 3.35 3.40 4.19 4.14 Interest-bearing balances at depositories 2.11 1.79 1.78 1.93 2.05 1.80 1.68 1.60 1.68 1.89 Non-interest-earning assets 9.55 9.10 9.03 8.90 8.68 8.64 8.32 8.50 8.84 8.63 Revaluation gains held in trading accounts3 n.a. .02 .05 .02 * * .01 .02 .01 .01 Other 9.55 9.08 8.99 8.88 8.68 8.63 8.31 8.49 8.84 8.63 Liabilities 91.85 91.62 91.36 91.06 90.78 90.55 90.90 90.95 90.32 89.94 Interest-bearing liabilities 74.42 74.77 75.00 75.06 75.19 75.42 76.76 77.43 77.01 76.35 Deposits 63.05 60.38 59.67 59.98 61.47 62.40 61.94 62.68 63.11 62.82 In foreign offices 1.43 1.69 1.71 1.33 1.23 1.31 1.20 1.28 1.24 .88 In domestic offices 61.62 58.69 57.96 58.65 60.25 61.09 60.74 61.40 61.87 61.94 Other checkable deposits 9.94 9.70 8.54 6.21 4.96 4.23 3.75 3.32 3.26 3.32 Savings (including MMDAs) 24.06 22.92 20.75 22.49 23.59 25.65 27.35 27.03 27.67 30.17 Small-denomination time deposits 20.78 19.29 21.11 21.61 22.03 21.22 19.61 19.44 18.80 16.83 Large-denomination time deposits 6.84 6.78 7.56 8.34 9.66 9.99 10.03 11.61 12.14 11.62 Gross federal funds purchased and RPs 7.43 8.45 8.31 8.19 7.09 6.16 6.90 6.30 5.76 5.28 Other 3.94 5.94 7.02 6.88 6.62 6.86 7.92 8.45 8.14 8.25 Non-interest-bearing liabilities 17.43 16.85 16.36 16.00 15.60 15.13 14.15 13.52 13.31 13.58 Demand deposits in domestic offices 15.07 14.58 14.07 13.84 13.15 11.90 10.19 8.97 8.23 8.05 Revaluation losses held in trading accounts3 .. n.a. .02 .05 .02 .01 .01 .01 * .01 .01 Other 2.36 2.26 2.24 2.14 2.44 3.22 3.95 4.55 5.07 5.52 Capital account 8.15 8.38 8.64 8.94 9.22 9.45 9.10 9.05 9.68 10.06 MEMO Commercial real estate loans 13.37 13.05 13.19 13.83 14.77 15.38 17.28 19.32 21.03 23.06 Other real estate owned .57 .28 .17 .13 .11 .09 .08 .07 .08 .10 Managed liabilities 19.68 22.89 24.62 24.78 24.66 24.46 26.32 28.01 27.75 26.57 Average net consolidated assets (billions of dollars) 978 1,031 1,092 1,075 968 935 972 987 1,002 1,022 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 2002 267 A. 1.—Continued D. Banks ranked 101 through 1,000 by assets Item 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Effective interest rate (percent)4 Rates earned Interest-earning assets 7.43 7.58 8.44 8.41 8.49 8.32 7.83 8.51 7.83 6.43 Taxable equivalent 7.55 7.68 8.53 8.50 8.59 8.44 7.92 8.58 7.95 6.55 Loans and leases, gross 8.57 8.64 9.45 9.38 9.48 9.37 8.74 9.44 8.76 7.36 Net of loss provisions 7.96 8.28 8.95 8.76 8.76 8.76 8.26 8.74 7.88 6.61 Securities 5.83 5.68 6.24 6.34 6.43 6.31 6.03 6.46 5.97 4.98 Taxable equivalent 6.10 5.93 6.50 6.60 6.69 6.57 6.29 6.71 6.25 5.24 Investment account 5.84 5.68 6.24 6.34 6.43 6.30 6.03 6.45 5.97 4.98 U.S. Treasury securities and U.S. government agency obligations (excluding MBS) n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 5.85 4.55 Mortgage-backed securities n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 6.33 5.48 Other n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 5.40 4.53 Trading account 4.74 5.29 5.55 5.94 6.37 6.84 7.33 9.30 6.60 3.79 Gross federal funds sold and reverse RPs 3.02 4.05 5.45 5.29 5.42 5.31 4.98 6.16 3.92 1.75 Interest-bearing balances at depositories 3.52 4.28 6.07 5.69 5.44 5.76 5.07 5.77 3.94 1.79 Rates paid Interest-bearing liabilities 3.33 3.57 4.65 4.58 4.66 4.60 4.19 4.93 4.11 2.56 Interest-bearing deposits 3.26 3.31 4.26 4.27 4.34 4.28 3.84 4.46 3.82 2.29 In foreign offices 3.35 4.31 5.94 5.72 5.42 5.55 5.07 6.13 4.45 2.14 In domestic offices 3.26 3.28 4.21 4.23 4.32 4.25 3.82 4.43 3.81 2.30 Other checkable deposits 2.02 1.86 2.02 1.96 2.16 2.15 1.99 2.27 1.81 1.06 Savings (including MMDAs) 2.58 2.64 3.24 3.11 3.08 2.97 2.65 3.07 2.22 1.18 Large time deposits5 3.90 4.23 5.62 5.48 5.56 5.51 5.17 6.01 5.27 3.36 Other time deposits5 4.40 4.40 5.53 5.57 5.57 5.64 5.11 5.74 5.52 3.80 Gross federal funds purchased and RPs 2.95 4.12 5.61 5.16 5.21 5.14 4.83 5.95 3.84 1.86 Other interest-bearing liabilities 4.44 4.93 6.32 5.90 6.09 6.00 5.36 6.45 5.41 4.21 Income and expense as a percentage of average net consolidated assets Gross interest income 6.74 6.90 7.69 7.68 7.75 7.63 7.19 7.80 7.16 5.88 Taxable equivalent 6.84 6.99 7.78 7.75 7.83 7.71 7.27 7.88 7.24 5.95 Loans 5.06 5.26 5.99 5.99 6.00 5.85 5.47 5.97 5.59 4.59 Securities 1.48 1.45 1.43 1.42 1.50 1.50 1.51 1.58 1.33 1.16 Gross federal funds sold and reverse RPs .14 .14 .21 .20 .19 .22 .17 .21 .16 .07 Other .06 .06 .07 .06 .06 .06 .04 .04 .04 .02 Gross interest expense 2.46 2.65 3.46 3.40 3.47 3.44 3.20 3.79 3.14 1.94 Deposits 2.07 2.01 2.56 2.57 2.70 2.71 2.44 2.87 2.48 1.50 Gross federal funds purchased and RPs .22 .35 .46 .43 .37 .32 .34 .38 .22 .10 Other .17 .29 .44 .40 .40 .41 .42 .54 .44 .34 Net interest income 4.28 4.25 4.24 4.27 4.28 4.19 3.99 4.01 4.02 3.94 Taxable equivalent 4.37 4.34 4.32 4.35 4.36 4.27 4.07 4.08 4.10 4.02 Loss provisioning6 .47 .32 .43 .50 .56 .48 .39 .53 .65 .54 Non-interest income 1.84 1.86 1.84 1.88 2.08 2.25 2.31 2.36 2.35 2.38 Service charges on deposits .45 .42 .42 .41 .40 .39 .38 .36 .39 .41 Fiduciary activities .29 .28 .27 .29 .32 .37 .38 .44 .40 .35 Trading income .03 .02 .03 .02 .01 .02 .02 .01 * * Interest rate exposures n.a. n.a. n.a. .01 .01 .01 .01 .01 -.01 * Foreign exchange rate exposures n.a. n.a. n.a. .01 * * * * * * Other commodity and equity exposures n.a. n.a. n.a. * * * • • * * Other 1.08 1.14 1.12 1.16 1.34 1.47 1.53 1.55 1.57 1.62 Non-interest expense 3.92 3.78 3.68 3.69 3.73 3.86 3.70 3.84 3.88 3.74 Salaries, wages, and employee benefits 1.51 1.49 1.44 1.44 1.50 1.57 1.56 1.59 1.61 1.65 Occupancy .48 .46 .45 .45 .46 .47 .47 .47 .46 .45 Other 1.92 1.83 1.79 1.80 1.76 1.83 1.68 1.79 1.81 1.65 1 I Net non-interest expense 2.08 1.92 1.84 1.81 1.65 1.61 1.39 1.49 1.53 1.36 I Gains on investment account securities .06 -.05 -.01 .02 .02 .04 -.01 -.04 .05 .04 1 Income before taxes and extraordinary items 1.78 1.96 1.96 1.98 2.10 2.14 2.19 1.95 1.89 2.08 Taxes .61 .67 .67 .69 .73 .73 .74 .67 .65 .69 | Extraordinary items, net of income taxes .04 * * * * .06 .01 * .01 * | Net income 1.21 1.29 1.28 1.29 1.37 1.46 1.46 1.28 1.25 1.40 J Cash dividends declared .79 .81 .87 1.04 1.09 1.01 1.06 .92 1.32 1.20 J Retained income .43 .48 .41 .25 .28 .45 .40 .36 -.08 .20 I MEMO: Return on equity 14.91 15.40 14.82 14.45 14.90 15.49 16.11 14.11 12.87 13.88 * In absolute value, less than 0.005 percent. n.a. Not available. MMDA Money market deposit account. RP Repurchase agreement. CD Certificate of deposit. 1. Includes allocated transfer risk reserves. 2. As in the Call Report, equity securities are combined with "other debt securities" before 1989. 3. Before 1994, the netted value of off-balance-sheet items appeared in "trading account securities" if a gain and "other non-interest-bearing liabilities" if a loss. 4. When possible, based on the average of quarterly balance sheet data reported on schedule RC-K of the quarterly Call Reports. 5. Before 1997, large time open accounts included in other time deposits. 6. Includes provisions for allocated transfer risk. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

268 Federal Reserve Bulletin • June 2003 A.l. Portfolio composition, interest rates, and income and expense, all U.S. banks, 1993-2002 E. Banks not ranked among the 1,000 largest by assets Item 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Balance sheet items as a percentage of average net consolidated assets Interest-earning assets 92.43 92.48 92.48 92.45 92.44 92.64 92.55 92.52 92.26 92.22 Loans and leases, net 52.95 54.64 56.61 57.38 58.75 59.11 59.75 62.31 62.65 62.72 Commercial and industrial 9.24 9.31 9.65 9.98 10.16 10.33 10.64 11.09 11.09 10.71 U.S. addressees 9.20 9.26 9.59 9.91 10.08 10.25 10.55 11.02 11.01 10.65 Foreign addressees .04 .05 .06 .07 .08 .08 .08 .07 .08 .06 Consumer 9.18 9.38 9.54 9.42 8.98 8.46 8.15 7.97 7.42 6.77 Credit card .92 .96 1.01 1.04 .85 .70 .68 .58 .57 .49 Installment and other 8.26 8.42 8.53 8.38 8.14 7.76 7.47 7.39 6.85 6.28 Real estate 31.10 32.19 33.55 34.10 35.55 36.04 36.84 39.30 40.29 41.52 In domestic offices 31.09 32.19 33.55 34.10 35.54 36.04 36.84 39.30 40.29 41.51 Construction and land development 1.93 2.14 2.38 2.61 2.82 3.02 3.28 3.70 4.23 4.51 Farmland 2.20 2.34 2.48 2.55 2.69 2.83 2.95 3.06 3.04 3.08 One- to four-family residential 16.82 16.94 17.45 17.48 18.16 18.04 17.66 18.43 18.24 17.91 Home equity 1.27 1.21 1.20 1.20 1.24 1.21 1.17 1.28 1.38 1.62 Other 15.56 15.73 16.26 16.28 16.92 16.84 16.49 17.15 16.86 16.29 Multifamily residential .84 .93 .95 .92 .95 .93 .98 1.04 1.06 1.16 Nonfarm nonresidential 9.30 9.83 10.28 10.54 10.92 11.21 11.97 13.06 13.71 14.86 In foreign offices To depository institutions and acceptances * * * * * * * * * * of other banks .16 .17 .19 .21 .20 .14 .14 .12 .12 .10 Foreign governments .02 .01 * * • • .01 .01 * * Agricultural production 3.58 3.89 3.95 3.92 4.05 4.28 4.06 3.85 3.75 3.64 Other loans .82 .77 .72 .69 .67 .67 .67 .69 .67 .65 Lease-financing receivables .18 .20 .22 .23 .25 .24 .26 .27 .27 .30 LESS: Unearned income on loans -.36 -.31 -.30 -.27 -.24 -.20 -.15 -.11 -.09 -.07 LESS: Loss reserves' -.97 -.95 -.93 -.90 -.87 -.86 -.87 -.88 -.88 -.90 Securities 33.08 32.90 30.51 29.53 28.25 26.70 26.92 25.40 22.83 23.34 Investment account 33.01 32.86 30.48 29.50 28.21 26.66 26.88 25.38 22.82 23.33 Debt 33.01 30.64 27.92 26.51 24.58 22.30 21.82 19.43 19.67 20.41 U.S. Treasury n.a. 10.75 9.19 7.86 6.70 5.05 3.34 2.12 1.33 1.04 U.S. government agency and corporation obligations n.a. 15.24 15.13 15.67 15.58 15.43 16.89 16.95 15.29 16.07 Government-backed mortgage pools ... n.a. 4.73 4.19 4.21 4.01 3.90 3.95 3.47 3.80 4.54 Collateralized mortgage obligations n.a. 3.05 2.76 2.46 2.19 2.02 2.00 1.70 1.94 2.30 Other n.a. 7.46 8.18 9.00 9.38 9.51 10.94 11.78 9.55 9.23 State and local government n.a. 5.00 4.69 4.62 4.60 4.80 4.96 4.64 4.51 4.56 Private mortgage-backed securities n.a. .26 .20 .18 .19 .16 .26 .23 .28 .27 Other n.a. .96 .81 .68 .61 .68 .89 .88 1.12 1.12 Equity2 n.a. .43 .45 .49 .52 .54 .53 .56 .30 .27 Trading account .07 .04 .03 .03 .03 .04 .03 .02 .01 .01 Gross federal funds sold and reverse RPs 4.67 3.42 3.91 4.03 3.95 5.13 4.17 3.22 5.00 4.26 Interest-bearing balances at depositories 1.74 1.52 1.45 1.51 1.49 1.72 1.71 1.59 1.77 1.90 Non-interest-earning assets 7.57 7.52 7.52 7.55 7.56 7.36 7.45 7.48 7.74 7.78 Revaluation gains held in trading accounts3 n.a. * * * * * * * * * Other 7.57 7.52 7.52 7.55 7.56 7.36 7.45 7.48 7.74 7.78 Liabilities 90.63 90.43 90.04 89.82 89.63 89.54 89.75 89.89 89.60 89.71 Interest-bearing liabilities 76.88 76.19 75.74 75.59 75.47 75.35 75.90 76.05 76.01 76.00 Deposits 74.54 73.14 72.70 72.47 72.05 71.77 71.41 70.54 70.92 70.50 In foreign offices .08 .09 .11 .10 .09 .07 .07 .05 .06 .05 In domestic offices 74.45 73.05 72.59 72.37 71.96 71.70 71.34 70.48 70.86 70.44 Other checkable deposits 13.16 13.31 12.37 11.75 11.39 11.18 11.07 10.57 10.18 10.42 Savings (including MMDAs) 23.55 23.23 20.41 19.58 18.98 19.01 19.69 19.03 19.15 20.99 Small-denomination time deposits 30.09 28.83 30.92 31.28 31.09 30.42 29.07 28.42 28.06 25.90 Large-denomination time deposits 7.66 7.68 8.89 9.76 10.50 11.10 11.50 12.47 13.47 13.13 Gross federal funds purchased and RPs 1.44 1.89 1.78 1.71 1.67 1.49 1.79 2.06 1.56 1.51 Other .90 1.16 1.25 1.41 1.74 2.09 2.70 3.45 3.53 4.00 Non-interest-bearing liabilities 13.74 14.24 14.30 14.23 14.16 14.19 13.86 13.84 13.59 13.71 Demand deposits in domestic offices 12.82 13.34 13.23 13.12 13.09 13.08 12.80 12.64 12.15 12.24 Revaluation losses held in trading accounts3 .. n.a. * * * • * * • • * Other .93 .90 1.07 1.10 1.06 1.10 1.06 1.20 1.44 1.47 Capital account 9.37 9.57 9.96 10.18 10.37 10.46 10.25 10.11 10.40 10.28 MEMO Commercial real estate loans 12.21 13.02 13.72 14.18 14.80 15.26 16.33 17.92 19.15 20.67 Other real estate owned .52 .35 .25 .20 .16 .13 .11 .11 .12 .14 Managed liabilities 10.09 10.83 12.05 12.99 14.02 14.76 16.08 18.07 18.68 18.79 Average net consolidated assets (billions of dollars) 687 679 666 661 647 644 651 655 675 704 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 2002 269 A. 1.—Continued E. Banks not ranked among the 1,000 largest by assets Item 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Effective interest rate (percent)4 Rates earned Interest-earning assets 7.62 7.57 8.38 8.36 8.49 8.33 8.05 8.49 7.97 6.83 Taxable equivalent 7.78 7.72 8.53 8.50 8.63 8.48 8.18 8.59 8.11 6.96 Loans and leases, gross 9.13 9.00 9.80 9.75 9.80 9.69 9.28 9.55 9.09 7.90 Net of loss provisions 8.78 8.80 9.54 9.47 9.49 9.34 8.89 9.13 8.64 7.47 Securities 5.94 5.61 6.10 6.15 6.26 6.04 5.88 6.15 5.93 5.04 Taxable equivalent 6.33 5.99 6.49 6.52 6.65 6.46 6.29 6.55 6.35 5.45 Investment account 5.95 5.61 6.10 6.14 6.26 6.04 5.89 6.15 5.93 5.04 U.S. Treasury securities and U.S. government agency obligations (excluding MBS) n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 5.98 4.81 Mortgage-backed securities n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 6.45 5.48 Other n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 5.31 4.91 Trading account 4.83 6.03 6.12 6.47 6.33 5.26 3.60 4.01 6.43 4.80 Gross federal funds sold and reverse RPs 2.95 4.08 5.95 5.34 5.51 5.35 4.96 6.26 3.85 1.65 Interest-bearing balances at depositories 4.53 4.64 5.88 5.63 5.62 5.67 5.69 6.40 4.56 2.68 Rates paid Interest-bearing liabilities 3.54 3.49 4.46 4.49 4.60 4.60 4.28 4.80 4.43 2.93 Interest-bearing deposits 3.53 3.44 4.39 4.44 4.53 4.53 4.21 4.67 4.34 2.80 In foreign offices 2.91 3.92 5.73 5.34 4.77 5.08 4.34 5.13 3.82 1.49 In domestic offices 3.53 3.44 4.39 4.44 4.53 4.53 4.21 4.67 4.34 2.80 Other checkable deposits 2.42 2.29 2.50 2.41 2.46 2.45 2.28 2.47 1.97 1.16 Savings (including MMDAs) 2.91 2.83 3.32 3.26 3.36 3.39 3.21 3.56 2.84 1.73 Large time deposits5 3.96 4.12 5.55 5.48 5.53 5.53 5.21 5.92 5.55 3.62 Other time deposits5 4.39 4.28 5.51 5.61 5.66 5.63 5.24 5.70 5.62 3.90 Gross federal funds purchased and RPs 3.17 4.12 5.61 5.12 5.23 4.99 4.73 5.69 4.03 1.85 Other interest-bearing liabilities 4.68 4.98 6.45 5.77 6.31 6.45 5.63 6.22 5.86 5.34 Income and expense as a percentage of average net consolidated assets Gross interest income 7.06 7.01 7.78 7.77 7.90 7.75 7.48 7.86 7.40 6.35 Taxable equivalent 7.20 7.15 7.91 7.89 8.02 7.87 7.60 7.97 7.50 6.46 Loans 4.92 4.99 5.63 5.68 5.86 5.80 5.62 6.02 5.78 5.06 Securities 1.96 1.84 1.86 1.80 1.76 1.59 1.58 1.58 1.33 1.16 Gross federal funds sold and reverse RPs .14 .15 .25 .24 .24 .29 .22 .21 .20 .08 Other .05 .04 .04 .04 .04 .06 .06 .05 .05 .03 Gross interest expense 2.72 2.65 3.37 3.39 3.48 3.46 3.26 3.64 3.36 2.23 Deposits 2.64 2.52 3.19 3.22 3.28 3.25 3.03 3.31 3.09 1.99 Gross federal funds purchased and RPs .04 .07 .10 .08 .08 .07 .08 .12 .06 .03 Other .04 .06 .08 .08 .11 .13 .15 .21 .21 .21 Net interest income 4.34 4.36 4.41 4.38 4.42 4.28 4.22 4.22 4.04 4.12 Taxable equivalent 4.48 4.50 4.54 4.50 4.54 4.41 4.35 4.33 4.15 4.22 Loss provisioning6 .27 .19 .24 .25 .27 .29 .31 .35 .36 .34 Non-interest income 1.25 1.30 1.38 1.42 1.42 1.52 1.44 1.32 1.34 1.40 1 Service charges on deposits .45 .44 .44 .44 .44 .42 .42 .43 .44 •45 1 Fiduciary activities .16 .17 .22 .19 .20 .23 .26 .21 .25 .27 Trading income .01 * .01 * * * * .01 * * Interest rate exposures n.a. n.a. n.a. * * * # * * * Foreign exchange rate exposures n.a. n.a. n.a. * * * * * * * Other commodity and equity exposures n.a. n.a. n.a. * * » # * * * Other .64 .69 .71 .79 .77 .86 .75 .68 .65 .68 Non-interest expense 3.74 3.78 3.80 3.70 3.69 3.74 3.73 3.59 3.56 3.54 Salaries, wages, and employee benefits 1.73 1.75 1.79 1.77 1.80 1.82 1.82 1.78 1.79 1.83 Occupancy .49 .49 .50 .49 .49 .49 .49 .47 .47 .47 Other 1.53 1.55 1.51 1.44 1.40 1.43 1.42 1.33 1.30 1.24 Net non-interest expense 2.49 2.48 2.42 2.28 2.28 2.23 2.29 2.27 2.22 2.15 Gains on investment account securities .07 -.03 * .01 .01 .02 * -.01 .04 .05 1 Income before taxes and extraordinary items 1.65 1.66 1.75 1.85 1.89 1.79 1.62 1.59 1.50 1.66 1 Taxes .51 .51 .55 .59 .59 .53 .46 .45 .41 .43 1 Extraordinary items, net of income taxes .05 * * * * * * * * -.01 1 Net income 1.19 1.15 1.20 1.26 1.30 1.26 1.15 1.15 1.09 1.21 I Cash dividends declared .56 .57 .62 .64 .74 .82 .68 .79 .66 .68 4 Retained income .63 .58 .58 .62 .56 .44 .48 .36 .43 .53 1 MEMO: Return on equity 12.67 12.03 12.05 12.37 12.53 12.02 11.25 11.38 10.49 11.81 * In absolute value, less than 0.005 percent. n.a. Not available. MMDA Money market deposit account. RP Repurchase agreement. CD Certificate of deposit. 1. Includes allocated transfer risk reserves. 2. As in the Call Report, equity securities are combined with "other debt securities" before 1989. 3. Before 1994, the netted value of off-balance-sheet items appeared in "trading account securities" if a gain and "other non-interest-bearing liabilities" if a loss. 4. When possible, based on the average of quarterly balance sheet data reported on schedule RC-K of the quarterly Call Reports. 5. Before 1997, large time open accounts included in other time deposits. 6. Includes provisions for allocated transfer risk. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

270 Federal Reserve Bulletin • June 2003 A.2. Report of income, all U.S. banks, 1993-2002 Millions of dollars Item 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Gross interest income 244,742 257,065 302,376 313,248 338,216 359,174 366,172 424,440 405,332 351,066 Taxable equivalent 247,620 259,822 305,012 315,708 340,648 361,638 368,799 427,076 408,016 353,822 Loans 178,425 189,764 227,220 239,401 255,492 270,940 278,573 327,385 312,484 270,732 Securities 48,678 48,299 51,030 50,634 52,659 56,596 62,115 67,676 63,128 59,416 Gross federal funds sold and reverse repurchase agreements 4,796 6,415 9,744 9,272 13,658 14,999 12,327 13,549 12,656 6,232 Other 12,843 12,587 14,382 13,944 16,406 16,637 13,155 15,831 17,065 14,686 Gross interest expense 105,615 110,850 147,960 150,101 164,511 177,999 174,901 222,112 188,898 119,084 Deposits 79,503 79,106 105,331 107,517 117,350 125,216 119,664 151,182 132,495 82,064 Gross federal funds purchased and repurchase agreements 8,442 12,476 18,424 16,780 20,439 22,182 21,130 26,860 19,602 9,934 Other 17,669 19,269 24,205 25,806 26,721 30,600 34,106 44,072 36,800 27,086 Net interest income 139,127 146,215 154,416 163,147 173,705 181,175 191,271 202,328 216,434 231,982 Taxable equivalent 142,005 148,972 157,052 165,607 176,137 183,639 193,898 204,964 219,118 234,738 Loss provisioning 16,841 10,991 12,632 16,211 19,176 21,220 21,121 29,788 43,313 45,180 Non-interest income 75,847 77,224 83,851 95,308 105,628 123,444 144,121 152,324 159,275 167,771 Service charges on deposits 14,898 15,281 16,057 17,051 18,558 19,769 21,497 23,719 26,892 29,658 Fiduciary activities 11,199 12,124 12,889 14,296 16,584 19,268 20,502 22,220 21,970 21,636 Trading revenue 9,238 6,249 6,337 7,525 8,018 7,705 10,478 12,446 12,547 10,709 Other 40,513 43,572 48,567 56,436 62,468 76,701 91,644 93,939 97,866 105,767 Non-interest expense 140,523 144,905 151,141 162,456 170,880 193,696 204,406 215,795 225,219 229,298 Salaries, wages, and employee benefits .. 58,507 60,904 64,014 67,800 72,310 79,503 86,150 89,030 94,275 100,574 Occupancy 18,578 18,978 19,760 20,889 22,074 24,160 25,864 26,764 27,959 29,394 Other 63,439 65,023 67,366 73,766 76,495 90,034 92,392 100,001 102,986 99,329 Net non-interest expense 64,676 67,681 67,290 67,148 65,252 70,252 60,285 63,471 65,944 61,527 Gains on investment account securities 3,054 -568 481 1,123 1,825 3,090 250 -2,290 4,627 6,475 Income before taxes 60,662 66,974 74,977 80,911 91,101 92,794 110,116 106,778 111,805 131,621 Taxes 19,861 22,429 26,222 28,448 31,973 31,878 39,233 37,333 37,236 43,430 Extraordinary items, net of income taxes . 2,085 -17 28 88 56 506 169 -31 -324 -95 Net income 42,886 44,528 48,783 52,551 59,184 61,421 71,052 69,413 74,244 88,096 Cash dividends declared 22,068 28,165 31,106 39,419 42,752 41,205 51,955 52,547 54,944 67,292 Retained income 20,816 16,362 17,678 13,131 16,433 20,215 19,097 16,866 19,299 20,804 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

271 Announcements CHAIRMAN GREENSPAN'S STATEMENT establish procedures to verify the identity of new REGARDING ANOTHER TERM IN OFFICE account holders. The rules announced were developed jointly by the On April 23, 2003, Federal Reserve Chairman Alan Treasury Department, Treasury's Financial Crimes Greenspan responded to the President's comments on Enforcement Network, and the seven federal funchis term in office: tional regulators, including the Board of Governors of the Federal Reserve System, the Commodity The President and I have not discussed this but I greatly Futures Trading Commission, the Federal Deposit appreciate his confidence. I have been privileged to be Insurance Corporation, the National Credit Union appointed by five Presidents to various positions. If Presi- Administration, the Office of the Comptroller of the dent Bush nominates me, and the Senate confirms his Currency, the Office of Thrift Supervision, and the choice, I would have every intention of serving. Securities and Exchange Commission. These regulations are part of the Administration's continuing work to implement the USA PATRIOT FEDERAL OPEN MARKET COMMITTEE Act and prevent money laundering, terrorist financ- DIRECTIVE ing, identity theft, and other forms of fraud while also providing financial institutions the flexibility they The Federal Open Market Committee, on May 6, need to effectively implement the rules. 2003, decided to keep its target for the federal funds These final regulations implement section 326 of rate unchanged at 1 VA percent. the USA PATRIOT Act, which directs that regula- Recent readings on production and employment, tions be issued requiring that financial institutions though mostly reflecting decisions made before the implement reasonable procedures to (1) verify the conclusion of hostilities, have proven disappointing. identity of any person opening an account; (2) main- However, the ebbing of geopolitical tensions has tain records of the information used to verify the rolled back oil prices, bolstered consumer confiperson's identity; and (3) determine whether the perdence, and strengthened debt and equity markets. son appears on any list of known or suspected terror- These developments, along with the accommodative ists or terrorist organizations. stance of monetary policy and ongoing growth in The regulations apply to banks and trust compaproductivity, should foster an improving economic nies, savings associations, credit unions, securities climate over time. brokers and dealers, mutual funds, futures commis- Voting for the FOMC monetary policy action were sion merchants, and futures introducing brokers. Alan Greenspan, Chairman; William J. McDonough, Institutions subject to the final rules will be Vice Chairman; Ben S. Bernanke; Susan S. Bies; required to establish a program for obtaining iden- J. Alfred Broaddus, Jr.; Roger W. Ferguson, Jr.; tifying information from customers opening new Edward M. Gramlich; Jack Guynn; Donald L. Kohn; accounts. The regulations will require that institu- Michael H. Moskow; Mark W. Olson; and Robert T. tions implement procedures for collecting standard Parry. information such as a customer's name, address, date of birth, and a taxpayer identification number (for U.S. persons, typically a social security number and TREASURY AND FEDERAL FINANCIAL for non-U.S. persons, a similar number from a REGULATORS ISSUE FINAL RULES ON government-issued document). CUSTOMER IDENTIFICATION A financial institution's program is also required, among other things, to contain procedures to verify The Department of the Treasury, the Financial the identity of customers within a reasonable period Crimes Enforcement Network, and the seven federal of time. Many financial institutions may rely on financial regulators on April 30, 2003, issued final examining standard identification such as a driver's rules that require certain financial institutions to license or passport. However, the final rule gives Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

272 Federal Reserve Bulletin • June 2003 financial institutions the flexibility to implement pro- Comments on the committee's third consultative cedures to verify identity in other ways appropriate to paper on the new Basel Capital Accord may be sent their individual circumstances. to both the Basel Committee and the regulatory Financial institutions will have until October 1, agencies. 2003, to come into full compliance. Publication of the final rules are expected in the Federal Register. PUBLICATION OF THE ANNUAL REPORT AND BUDGET REVIEW BANKING AGENCIES PUBLISH BASEL ACCORD CONSULTATIVE PAPER The 89th Annual Report, 2002, of the Board of Governors of the Federal Reserve System, covering The Basel Committee on Banking Supervision, based operations for the calendar year 2002, is now availin Basel, Switzerland, released its third consultative able from Publications Fulfillment, Mail Stop 127, paper on the new Basel Capital Accord for comment Board of Governors of the Federal Reserve System, on April 29, 2003. The paper seeks to continue the Washington, DC 20551, or phone 202-452-3244 consultation process on revising the 1988 Capital or 3245. Also available from Publications Fulfill- Accord. Comments are invited by July 31, 2003. ment is a separately printed companion docu- The Basel Committee released the previous consulment, Annual Report, Budget Review, 2003, which tative paper on the new Accord in January 2001. The describes the budget expenses of the Federal Reserve proposals have been substantially revised since that Banks for 2003, the 2003 phase of the Board's curtime to reflect the comments received on the 2001 rent two-year (2003-04) budget, and income and document, as well as comments on several other expenses for 2001 and 2002. Both reports are also documents released by the Basel Committee. Particuavailable on the Federal Reserve Board's web site: lar focus has been given to the Internal Ratings Based w w w .federalreserve. gov. Approaches for commercial and retail credits, securitization, and the quantitative methodologies for operational risk. These changes reflect the continuing development of the new Accord and do not reflect a ENFORCEMENT ACTIONS fundamental change to the overall framework, which established minimum capital for credit, market, and The Federal Reserve Board on April 21, 2003, operational risks. The framework also encompasses announced the execution of a written agreement by supervisory review of capital adequacy and market and between the Premier Bank, Denver, Colorado, discipline through enhanced disclosure. and the Federal Reserve Bank of Kansas City. The U.S. agencies plan to follow the release of this consultative paper with an Advance Notice of Pro- The Federal Reserve Board on April 22, 2003, posed Rulemaking (ANPR) in the next few months. announced the issuance of a consent order of assess- This ANPR will be based on the Committee's third ment of a civil money penalty against the First Farmconsultative paper and will focus on how the U.S. ers Bank and Trust, Converse, Indiana, a state memagencies intend to implement domestic changes that ber bank. First Farmers Bank and Trust, without reflect the specific nature of U.S. banks and banking. admitting to any allegations, consented to the issu- The ANPR will also provide a proposal on the scope ance of the order in connection with its alleged of application of the new Accord (that is, the criteria violations of the Board's regulations implementing in the U.S. rule governing the population of U.S. the National Flood Insurance Act. banks that will be required to comply with Basel II). The order requires First Farmers Bank and Trust to Banks and other interested parties will be given the pay a civil money penalty of $3,850, which will be opportunity to comment on the ANPR proposals, as remitted to the Federal Emergency Management well as on the Notice of Proposed Rulemaking that Agency for deposit into the National Flood Mitigawill follow the ANPR. tion Fund. The paper is available on the committee's web site at www.bis.org, on the Office of the Comptroller The Federal Reserve Board on April 29, 2003, of the Currency's web site at www.occ.treas.gov, announced the execution of a written agreement by on the Federal Reserve Board's web site at and among BANKFIRST Corporation, Sioux Falls, www.federalreserve.gov, and on the Federal Deposit South Dakota, a registered bank holding company, Insurance Corporation's web site at www.fdic.gov. and its subsidiary bank, BANKFIRST, also of Sioux Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Announcements 273 Falls, South Dakota, and the Federal Reserve Bank of Daiwa Bank to terminate its U.S. activities, the bank Minneapolis. has been operating in the United States under a liquidation plan. The Federal Reserve Board on April 30, 2003, announced the execution of a written agreement by and among the HSBC Bank USA, Buffalo, New CHAIRMAN GREENSPAN HAS SUCCESSFUL York, the Federal Reserve Bank of New York, and SURGERY the New York State Banking Department. Chairman Greenspan, on April 22, 2003, spent a The Federal Reserve Board on May 1, 2003, short time in a local hospital to be treated surgically announced the execution of a written agreement by for benign prostatic hypertrophy, an enlarged prosand among The First State Bank of West Manchester, tate. Tests were negative for prostate cancer. West Manchester, Ohio, the Federal Reserve Bank Chairman Greenspan's surgery was routine and of Cleveland, and the Ohio Division of Financial successful. He recuperated in the hospital overnight Institutions. and expected to be back in his office later in the week. TERMINATION OF ENFORCEMENT ORDERS BOARD STAFF CHANGES Federal and state banking regulators on May 5, 2003, announced the termination of two enforcement orders The Board of Governors has approved the following issued in 1995 against Daiwa Bank, Limited, of change of assignments in the Division of Consumer Osaka, Japan. and Community Affairs. The first, the Order Issued upon Consent, was issued by the Federal Reserve Board on October 2, Sandra B. Braunstein, Senior Associate Director, 1995, and amended on March 18, 1996. will have direct oversight of the Consumer Policies The second, the Order to Terminate United States program, in addition to her current oversight of the Banking Activities Issued upon Consent, was issued Community Affairs function and the Consumer Advion November 1, 1995, and amended on February 2, sory Council. 1996, by the Board, the Federal Deposit Insurance Tonda E. Price, Assistant Director, will have direct Corporation, the New York State Banking Depart- oversight of the Consumer Complaint section, in ment, and bank supervisory agencies in California, addition to her current oversight of the Information Florida, Georgia, Illinois, and Massachusetts. Systems function and Division Administration. The federal and state bank supervisory agencies issued enforcement orders to terminate Daiwa Bank's William A. Ryback, Senior Associate Director, U.S. activities in 1995 due to the concealment from Division of Banking Supervision and Regulation, the regulators by the banking organization's senior retired on June 3 after thirty-five years of combined management and some directors of losses of more service at the Board and the Office of the Comptroller than $1 billion that were associated with unreported of the Currency in international bank supervision. • trading activities. Since the supervisors ordered Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

275 Legal Developments FINAL RULE—AMENDMENT TO RULES Subpart C—Provisions Applicable to Particular REGARDING EQUAL OPPORTUNITY Complaints The Board of Governors of the Federal Reserve System Section 268.201 Age Discrimination in Employment Act. (the Board) has adopted a final rule that amends its "Rules Section 268.202 Equal Pay Act. Regarding Equal Opportunity," which establishes pro- Section 268.203 Rehabilitation Act. grams and procedures to promote equal opportunity for Section 268.204 Class complaints. Board employees. This rule was published on January 25, Section 268.205 Employment of noncitizens. 2001, in the Federal Register as an immediately effective interim rule with opportunity for public comment. The Subpart D—Related Processes Board received one public comment on this rule. The Board is now adopting the interim rule as a final rule with Section 268.301 Negotiated grievance procedure. substantive changes to sections in the rule that address the Section 268.302 Mixed case complaints. Rehabilitation Act. These substantive changes are being made because after the Board adopted its interim rule, the Equal Employment Opportunity Commission (Commis- Subpart E—Appeals to the Equal Employment sion), after public comment, adopted changes to the pro- Opportunity Commission visions in its parallel regulation entitled "Federal Sector Equal Employment Opportunity," 29 C.F.R. Part 1614, that Section 268.401 Appeals to the Equal Employment address the Rehabilitation Act. The substantive changes to Opportunity Commission. the Board's final rule, which incorporates changes to the Section 268.402 Time for appeals to the Equal Employ- Commission's regulation on the Rehabilitation Act, also ment Opportunity Commission. respond to the comment that the Board received on its rule. Section 268.403 How to appeal. This final rule is effective immediately and applies to all Section 268.404 Appellate Procedure. Board equal employment opportunity (EEO) complaints Section 268.405 Decisions on appeals. pending at any stage of the administrative process as of Section 268.406 Civil action: Title VII, Age Discrimina- April 15, 2003. tion in Employment Act and Rehabilita- For the reasons set out in the preamble, 12 C.F.R. tion Act. Part 268 is amended as follows: Section 268.407 Civil action: Equal Pay Act. Section 268.408 Effect of filing a civil action. Part 268—Rules Regarding Equal Opportunity Subpart F—Remedies and Enforcement Subpart A—General Provisions and Administration Section 268.501 Remedies and relief. Section 268.1 Authority, purpose and scope. Section 268.502 Compliance with final Commission Section 268.2 Definitions. decisions. Section 268.503 Enforcement of final EEOC decisions. Subpart B—Board Program To Promote Equal Section 268.504 Compliance with settlement agreements Opportunity and final actions. Section 268.505 Interim relief. Section 268.101 General policy for equal opportunity. Section 268.102 Board program for equal employment opportunity. Subpart G—Matters of General Applicability Section 268.103 Complaints of discrimination covered by this part. Section 268.601 EEO group statistics. Section 268.104 Pre-complaint processing. Section 268.602 Reports to the Commission. Section 268.105 Individual complaints. Section 268.603 Voluntary settlement attempts. Section 268.106 Dismissals of complaints. Section 268.604 Filing and computation of time. Section 268.107 Investigation of complaints. Section 268.605 Representation and official time. Section 268.108 Hearings. Section 268.606 Joint processing and consolidation Section 268.109 Final action by the Board. of complaints. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

276 Federal Reserve Bulletin • June 2003 Section 268.607—Delegation of Authority. Subpart B—Board Program to Promote Equal Opportunity Subpart H—Prohibition Against Discrimination in Board Programs and Activities Because of a Physical Section 268.101—General policy for equal or Mental Disability opportunity. Section 268.701 Purpose and application. (a) It is the policy of the Board to provide equal oppor- Section 268.702 Definitions tunity in employment for all persons, to prohibit dis- Section 268.703 Notice. crimination in employment because of race, color, Section 268.704 General prohibition against religion, sex, national origin, age or disability, and to discrimination. promote the full realization of equal opportunity in Section 268.705 Employment. employment through a continuing affirmative program. Section 268.706 Program accessibility: Discrimination (b) No person shall be subject to retaliation for opposing prohibited. any practice made unlawful by Title VII of the Civil Section 268.707 Program accessibility: Existing Rights Act (title VII) (42 U.S.C. 2000e et seq.), the facilities. Age Discrimination in Employment Act (ADEA) Section 268.708 Program accessibility: New construction (29 U.S.C. 621 et seq.), the Equal Pay Act (29 U.S.C. and alterations. 206(d)), or the Rehabilitation Act (29 U.S.C. 791 Section 268.709 Communications. et seq.) or for participating in any stage of administra- Section 268.710 Compliance procedures. tive or judicial proceedings under those statutes. Authority: 12 U.S.C. 244 and 248(i), (k) and (/). Section 268.102—Board program for equal employment opportunity. Subpart A—General Provisions and Administration (a) The Board shall maintain a continuing affirmative pro- Section 268.1—Authority, purpose and scope. gram to promote equal opportunity and to identify and eliminate discriminatory practices and policies. In sup- (a) Authority. The regulations in this part (12 C.F.R. port of this program, the Board shall: Part 268) are issued by the Board of Governors of the (1) Provide sufficient resources to its equal opportu- Federal Reserve System (Board) under the authority of nity program to ensure efficient and successful sections 10(4) and ll(i), (k), and (/) of the Federal operation; Reserve Act (partially codified in 12 U.S.C. §§244 and (2) Provide for the prompt, fair and impartial pro- 248(i), (k) and (/)). cessing of complaints in accordance with this part (b) Purpose and scope. This part sets forth the Board's and the instructions contained in the Commispolicy, program and procedures for providing equal sion's Management Directives; opportunity to Board employees and applicants for (3) Conduct a continuing campaign to eradicate employment without regard to race, color, religion, every form of prejudice or discrimination from sex, national origin, age, or physical or mental disabilthe Board's personnel policies, practices and ity. It also sets forth the Board's policy, program and working conditions; procedures for prohibiting discrimination on the basis (4) Communicate the Board's equal employment of physical or mental disability in programs and activiopportunity policy and program and its employties conducted by the Board. It also specifies the cirment needs to all sources of job candidates withcumstances under which the Board will hire or decline out regard to race, color, religion, sex, national to hire persons who are not citizens of the United origin, age or disability, and solicit their recruit- States, consistent with the Board's operational needs ment assistance on a continuing basis; and applicable law. (5) Review, evaluate and control managerial and supervisory performance in such a manner as Section 268.2—Definitions. to insure a continuing affirmative application and vigorous enforcement of the policy of equal The definitions contained in this section shall have the opportunity, and provide orientation, training and following meanings throughout this part unless otherwise advice to managers and supervisors to assure stated. their understanding and implementation of the equal employment opportunity policy and (a) Commission or EEOC means the Equal Employment program; Opportunity Commission. (6) Take appropriate disciplinary action gainst (b) Title VII means Title VII of the Civil Rights Act employees who engage in discriminatory (42 U.S.C. 2000e et seq.). practices; Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 277 (7) Make reasonable accommodation to the religious available to them and prominently post such writneeds of employees and applicants for employ- ten materials in all personnel and EEO offices and ment when those accommodations can be made throughout the workplace; without undue hardship on the business of the (6) Ensure that full cooperation is provided by all Board; Board employees to EEO Counselors and Board (8) Make reasonable accommodation to the known EEO personnel in the processing and resolution of physical or mental limitations of qualified appli- pre-complaint matters and complaints within the cants and employees with a disability unless the Board and that full cooperation is provided to the accommodation would impose an undue hardship Commission in the course of appeals, including, on the operations of the Board's program; granting the Commission routine access to person- (9) Provide recognition to employees, supervi- nel records of the Board when required in connecsors, managers and units demonstrating supe- tion with an investigation; rior accomplishment in equal employment (7) Publicize to all employees and post at all times the opportunity; names, business telephone numbers and business (10) Establish a system for periodically evaluating addresses of the EEO Counselors (unless the counthe effectiveness of the Board's overall equal seling function is centralized, in which case only employment opportunity effort; the telephone number and address need be publi- (11) Provide the maximum feasible opportunity to cized and posted), a notice of the time limits and employees to enhance their skills through on-the- necessity of contacting a Counselor before filing job training, work-study programs and other a complaint and the telephone numbers and training measures so that they may perform at addresses of the EEO Programs Director, EEO their highest potential and advance in accordance Officer(s) and the Special Emphasis Program with their abilities; Managers/Coordinators. (12) Inform its employees and recognized labor orga- (c) The EEO Programs Director shall be responsible for: nizations of the Board's affirmative equal oppor- (1) Advising the Board of Governors with respect tunity policy and program and enlist their coop- to the preparation of national and regional equal eration; and employment opportunity plans, procedures, regu- (13) Participate at the community level with other lations, reports and other matters pertaining to employers, with schools and universities and with the policy in section 268.101 and the Board's other public and private groups in cooperative program; action to improve employment opportunities and (2) Evaluating from time to time the sufficiency of the community conditions that affect employability. total Board program for equal employment oppor- (b) In order to implement its program, the Board shall: tunity and reporting to the Board of Governors (1) Develop the plans, procedures and regulations nec- with recommendations as to any improvement or essary to carry out its program; correction needed, including remedial or disciplin- (2) Establish or make available an alternative dispute ary action with respect to managerial, supervisory resolution program. Such program must be avail- or other employees who have failed in their able for both the precomplaint process and the responsibilities; formal complaint process. (3) When authorized by the Board of Governors, mak- (3) Appraise its personnel operations at regular ing changes in programs and procedures designed intervals to assure their conformity with the to eliminate discriminatory practices and to Board's program, this part 268 and the instruc- improve the Board's program for equal employtions contained in the Commission's management ment opportunity; directives; (4) Providing for counseling of aggrieved individuals (4) Designate a Director for Equal Employment and for the receipt and processing of individual Opportunity (EEO Programs Director), EEO and class complaints of discrimination; and Officer(s), and such Special Emphasis Program (5) Assuring that individual complaints are fairly and Managers/Coordinators (e.g., People with Disabili- thoroughly investigated and that final action is ties Program, Federal Women's Program and His- taken in a timely manner in accordance with this panic Employment Program), clerical and adminis- part. trative support as may be necessary to carry out (d) Directives, instructions, forms and other Commission the functions described in this part in all organiza- materials referenced in this part may be obtained in tional units of the Board and at all Board installa- accordance with the provisions of 29 C.F.R. 1610.7. tions. The EEO Programs Director shall be under the immediate supervision of the Chairman. Section 268.103—Complaints of discrimination (5) Make written materials available to all employ- covered by this part. ees and applicants informing them of the variety of equal employment opportunity programs and (a) Individual and class complaints of employment disadministrative and judicial remedial procedures crimination and retaliation prohibited by title VII (dis- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

278 Federal Reserve Bulletin • June 2003 crimination on the basis of race, color, religion, sex Board and the Commission informed of their curand national origin), the ADEA (discrimination on the rent address and to serve copies of appeal papers basis of age when the aggrieved person is at least on the Board. The notice required by para- 40 years of age), the Rehabilitation Act (discrimination graphs (d) or (e) of this section shall include a on the basis of disability), or the Equal Pay Act (sex- notice of the right to file a class complaint. If the based wage discrimination) shall be processed in aggrieved person informs the Counselor that he or accordance with this part. Complaints alleging retalia- she wishes to file a class complaint, the Counselor tion prohibited by these statutes are considered to be shall explain the class complaint procedures and complaints of discrimination for purposes of this part. the responsibilities of a class agent. (b) This part applies to all Board employees and appli- (2) Counselors shall advise aggrieved persons that, cants for employment at the Board, and to all employ- where the Board agrees to offer ADR in the parment policies or practices affecting Board employees ticular case, they may choose between participaor applicants for employment. tion in the alternative dispute resolution program (c) This part does not apply to Equal Pay Act complaints and the counseling activities provided for in paraof employees whose services are performed within a graph (c) of this section. foreign country or certain United States territories as (c) Counselors shall conduct counseling activities in provided in 29 U.S.C. § 213(f). accordance with instructions contained in Commission Management Directives. When advised that a com- Section 268.104—Pre-complaint processing. plaint has been filed by an aggrieved person, the Counselor shall submit a written report within 15 days to the (a) Aggrieved persons who believe they have been dis- EEO Programs Director and the aggrieved person concriminated against on the basis of race, color, religion, cerning the issues discussed and actions taken during sex, national origin, age or disability must consult a counseling. Counselor prior to filing a complaint in order to try to (d) Unless the aggrieved person agrees to a longer couninformally resolve the matter. seling period under paragraph (e) of this section, or the (1) An aggrieved person must initiate contact with a aggrieved person chooses an alternative dispute resolu- Counselor within 45 days of the date of the matter tion procedure in accordance with paragraph (b)(2) of alleged to be discriminatory or, in the case of a this section, the Counselor shall conduct the final interpersonnel action, within 45 days of the effective view with the aggrieved person within 30 days of the date of the action. date the aggrieved person contacted the Board's EEO (2) The Board or the Commission shall extend the Programs Office to request counseling. If the matter 45-day time limit in paragraph (a)(1) of this sec- has not been resolved, the aggrieved person shall be tion when the individual shows that he or she was informed in writing by the Counselor, not later than the not notified of the time limits and was not other- thirtieth day after contacting the Counselor, of the right wise aware of them, that he or she did not know to file a discrimination complaint with the Board. This and reasonably should not have known that the notice shall inform the complainant of the right to file discriminatory matter or personnel action occurred, a discrimination complaint within 15 days of receipt that despite due diligence he or she was prevented of the notice, of the appropriate official with whom to by circumstances beyond his or her control from file a complaint and of the complainant's duty to contacting the counselor within the time limits, or assure that the EEO Programs Director is informed for other reasons considered sufficient by the immediately if the complainant retains counsel or a Board or the Commission. representative. (b) (1) At the initial counseling session, Counselors must (e) Prior to the end of the 30-day period, the aggrieved advise individuals in writing of their rights and person may agree in writing with the Board to postresponsibilities, including the right to request a pone the final interview and extend the counseling hearing or an immediate final decision after an period for an additional period of no more than investigation by the Board in accordance with 60 days. If the matter has not been resolved before the section 268.107(f), election rights pursuant to sec- conclusion of the agreed extension, the notice tion 268.302, the right to file a notice of intent to described in paragraph (d) of this section shall be sue pursuant to section 268.201(a) and a lawsuit issued. under the ADEA instead of an administrative com- (f) Where the aggrieved person chooses to participate in plaint of age discrimination under this part, the an alternative dispute resolution procedure in accorduty to mitigate damages, administrative and court dance with paragraph (b)(2) of this section, the pretime frames, and that only the claims raised in complaint processing period shall be 90 days. If the precomplaint counseling (or issues or claims like claim has not been resolved before the 90th day, the or related to issues or claims raised in pre- notice described in paragraph (d) of this section shall complaint counseling) may be alleged in a subse- be issued. quent complaint filed with the Board. Counselors (g) The Counselor shall not attempt in any way to restrain must advise individuals of their duty to keep the the aggrieved person from filing a complaint. The Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 279 Counselor shall not reveal the identity of an aggrieved (2) That fails to comply with the applicable time limperson who consulted the Counselor, except when its contained in sections 268.104, 268.105 and authorized to do so by the aggrieved person, or until 268.204(c), unless the Board extends the time limthe Board has received a discrimination complaint its in accordance with section 268.604(c), or that under this part from that person involving the same raises a matter that has not been brought to the matter. attention of a Counselor and is not like or related to a matter that has been brought to the attention of Section 268.105—Individual complaints. a Counselor; (3) That is the basis of a pending civil action in a (a) A complaint must be filed with the agency that alleg- United States District Court in which the comedly discriminated against the complainant. plainant is a party provided that at least 180 days (b) A complaint must be filed within 15 days of receipt of have passed since the filing of the administrative the notice required by section 268.104 (d), (e) or (f). complaint, or that was the basis of a civil action (c) A complaint must contain a signed statement from the decided by a United States District Court in which person claiming to be aggrieved or that person's attor- the complainant was a party; ney. This statement must be sufficiently precise to (4) Where a complainant has raised the matter in an identify the aggrieved individual and the Board and to appeal to the Merit Systems Protection Board and describe generally the action(s) or practice(s) that form section 268.302 indicates that the complainant has the basis of the complaint. The complaint must also elected to pursue the non-EEO process; contain a telephone number and address where the (5) That is moot or alleges that a proposal to take a complainant or the representative can be contacted. personnel action, or other preliminary step to tak- (d) A complainant may amend a complaint at any time ing a personnel action, is discriminatory; prior to the conclusion of the investigation to include (6) Where the complainant cannot be located, proissues or claims like or related to those raised in the vided that reasonable efforts have been made to complaint. After requesting a hearing, a complainant locate the complainant and the complainant has may file a motion with the administrative judge to not responded within 15 days to a notice of proamend a complaint to include issues or claims like or posed dismissal sent to his or her last known related to those raised in the complaint. address; (e) The Board shall acknowledge receipt of a complaint or (7) Where the Board has provided the complainant an amendment to a complaint in writing and inform the with a written request to provide relevant informacomplainant of the date on which the complaint or tion or otherwise proceed with the complaint, and amendment was filed. The Board shall advise the com- the complainant has failed to respond to the plainant in the acknowledgment of the EEOC office request within 15 days of its receipt or the comand its address where a request for a hearing shall be plainant's response does not address the Board's sent. Such acknowledgment shall also advise the com- request, provided that the request included a notice plainant that: of the proposed dismissal. Instead of dismissing (1) The complainant has the right to appeal the final for failure to cooperate, the complaint may be action on or dismissal of a complaint; and adjudicated if sufficient information for that pur- (2) The Board is required to conduct an impartial and pose is available; appropriate investigation of the complaint within (8) That alleges dissatisfaction with the processing of 180 days of the filing of the complaint unless the a previously filed complaint; or parties agree in writing to extend the time period. (9) Where the Board, strictly applying the criteria set When a complaint has been amended, the Board forth in Commission decisions, finds that the comshall complete its investigation within the earlier plaint is part of a clear pattern of misuse of the of 180 days after the last amendment to the com- EEO process for a purpose other than the prevenplaint or 360 days after the filing of the original tion and elimination of employment discriminacomplaint, except that the complainant may tion. A clear pattern of misuse of the EEO process request a hearing from an administrative judge on requires: the consolidated complaints any time after (i) Evidence of multiple complaint filings; and 180 days from the date of the first filed complaint. (ii) Allegations that are similar or identical, lack specificity or involve matters previously Section 268.106—Dismissals of complaints. resolved; or (iii) Evidence of circumventing other administra- (a) Prior to a request for a hearing in a case, the Board tive processes, retaliating against the Board's shall dismiss an entire complaint: in-house administrative processes or overbur- (1) That fails to state a claim under section 268.103 or dening the EEO complaint system. section 268.105(a), or states the same claim that is (b) Where the Board believes that some but not all of the pending before or has been decided by the Board claims in a complaint should be dismissed for the or the Commission; reasons contained in paragraphs (a)(1) through (9) of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

280 Federal Reserve Bulletin • June 2003 this section, the Board shall notify the complainant in (v) Take such other actions as it deems writing of its determination, the rationale for that deter- appropriate. mination and that those claims will not be investigated, (d) Any investigation will be conducted by investigators and shall place a copy of the notice in the investigative with appropriate security clearances. file. A determination under this paragraph is review- (e) (1) The Board shall complete its investigation within able by an administrative judge if a hearing is 180 days of the date of filing of an individual requested on the remainder of the complaint, but is not complaint or within the time period contained in appealable until final action is taken on the remainder an order from the Office of Federal Operations of the complaint. on an appeal from a dismissal pursuant to section 268.106. By written agreement within those Section 268.107—Investigation of complaints. time periods, the complainant and the Board may voluntarily extend the time period for not more (a) The investigation of complaints filed against the Board than an additional 90 days. The Board may unilatshall be conducted by the Board. erally extend the time period or any period of (b) In accordance with instructions contained in Commis- extension for not more than 30 days where it must sion Management Directives, the Board shall develop sanitize a complaint file that may contain inforan impartial and appropriate factual record upon which mation classified pursuant to Executive Order to make findings on the claims raised by the written No. 12356, or successor orders, as secret in the interest of national defense or foreign policy, procomplaint. An appropriate factual record is one that vided the Board notifies the complainant of the allows a reasonable fact finder to draw conclusions as extension. to whether discrimination occurred. The Board may use an exchange of letters or memoranda, interrogato- (2) Confidential supervisory information, as defined in ries, investigations, fact-finding conferences or any 12 C.F.R. 261.2(c), and other confidential informaother fact-finding methods that efficiently and thor- tion of the Board may be included in the investioughly address the matters at issue. The Board may gative file by the investigator, the EEO Programs incorporate alternative dispute resolution techniques Director, or another appropriate officer of the into its investigative efforts in order to promote early Board, where such information is relevant to the resolution of complaints. complaint. Neither the complainant nor the com- (c) The procedures in paragraphs (c)(1) through (3) of this plainant's personal representative may make fursection apply to the investigation of complaints: ther disclosure of such information, however, except in compliance with the Board's Rules (1) The complainant, the Board, and any employee of Regarding Availability of Information, 12 C.F.R. the Board shall produce such documentary and Part 261, and where applicable, the Board's Rules testimonial evidence as the investigator deems Regarding Access to Personal Information under necessary. the Privacy Act of 1974, 12 C.F.R. Part 261a. (2) Investigators are authorized to administer oaths. Statements of witnesses shall be made under oath (f) Within 180 days from the filing of the complaint, or or affirmation or, alternatively, by written state- where a complaint was amended, within the earlier of ment under penalty of perjury. 180 days after the last amendment to the complaint or (3) When the complainant, or the Board or its employ- 360 days after the filing of the original complaint, ees fail without good cause shown to respond fully within the time period contained in an order from the Office of Federal Operations on an appeal from a and in timely fashion to requests for documents, dismissal, or within any period of extension provided records, comparative data, statistics, affidavits or for in paragraph (e) of this section, the Board shall the attendance of witness(es), the investigator may provide the complainant with a copy of the investiganote in the investigative record that the decisiontive file, and shall notify the complainant that, within maker should, or the Commission on appeal may, 30 days of receipt of the investigative file, the comin appropriate circumstances: plainant has the right to request a hearing and decision (i) Draw an adverse inference that the requested from an administrative judge or may request an immeinformation, or the testimony of the requested diate final decision pursuant to section 268.109(b) from witness, would have reflected unfavorably on the Board. the party refusing to provide the requested information; (g) Where the complainant has received the notice (ii) Consider the matters to which the requested required in paragraph (f) of this section or at any time information or testimony pertains to be estab- after 180 days have elapsed from the filing of the lished in favor of the opposing party; complaint, the complainant may request a hearing by (iii) Exclude other evidence offered by the party submitting a written request for a hearing directly to failing to produce the requested information the EEOC office indicated in the Board's acknowledgor witness; ment letter. The complainant shall send a copy of the request for a hearing to the Board's EEO Programs (iv) Issue a decision fully or partially in favor of Office. Within 15 days of receipt of the request for a the opposing party; or Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 281 hearing, the Board's EEO Programs Office shall pro- hearing and may issue such discovery orders as are vide a copy of the complaint file to EEOC and, if not appropriate. Unless the parties agree in writing conpreviously provided, to the complainant. cerning the methods and scope of discovery, the party seeking discovery shall request authorization from the Section 268.108—Hearings. administrative judge prior to commencing discovery. Both parties are entitled to reasonable development of (a) When a complainant requests a hearing, the Commis- evidence on matters relevant to the issues raised in the sion shall appoint an administrative judge to conduct a complaint, but the administrative judge may limit hearing in accordance with this section. Upon appoint- the quantity and timing of discovery. Evidence may be ment, the administrative judge shall assume full developed through interrogatories, depositions, and responsibility for the adjudication of the complaint, requests for admissions, stipulations or production of including overseeing the development of the record. documents. It shall be grounds for objection to produc- Any hearing will be conducted by an administrative ing evidence that the information sought by either judge or hearing examiner with appropriate security party is irrelevant, overburdensome, repetitious, or clearances. privileged. (b) Dismissals. Administrative judges may dismiss com- (e) Conduct of hearing. The Board shall provide for the plaints pursuant to section 268.106, on their own initia- attendance at a hearing of all employees approved as tive, after notice to the parties, or upon the Board's witnesses by an administrative judge. Attendance at motion to dismiss a complaint. hearings will be limited to persons determined by the (c) Offer of resolution. administrative judge to have direct knowledge relating (1) Any time after the filing of the written complaint to the complaint. Hearings are part of the investigative but not later than the date an administrative judge process and are thus closed to the public. The adminisis appointed to conduct a hearing, the Board may trative judge shall have the power to regulate the make an offer of resolution to a complainant who conduct of a hearing, limit the number of witnesses is represented by an attorney. where testimony would be repetitious, and exclude any (2) Any time after the parties have received notice that person from the hearing for contumacious conduct or an administrative judge has been appointed to con- misbehavior that obstructs the hearing. The administraduct a hearing, but not later than 30 days prior to tive judge shall receive into evidence information or the hearing, the Board may make an offer of reso- documents relevant to the complaint. Rules of evilution to the complainant, whether represented by dence shall not be applied strictly, but the administraan attorney or not. tive judge shall exclude irrelevant or repetitious evidence. The administrative judge or the Commission (3) The offer of resolution shall be in writing and shall may refer to the Disciplinary Committee of the approinclude a notice explaining the possible consepriate Bar Association any attorney or, upon reasonquences of failing to accept the offer. The Board's able notice and an opportunity to be heard, suspend or offer, to be effective, must include attorney's fees disqualify from representing complainants or agencies and costs and must specify any non-monetary in EEOC hearings any representative who refuses to relief. With regard to monetary relief, the Board follow the orders of an administrative judge, or who may make a lump sum offer covering all forms of otherwise engages in improper conduct. monetary liability, or it may itemize the amounts and types of monetary relief being offered. The (f) Procedures. complainant shall have 30 days from receipt of the (1) The complainant, the Board and any employee of offer of resolution to accept it. If the complainant the Board shall produce such documentary and fails to accept an offer of resolution and the relief testimonial evidence as the administrative judge awarded in the administrative judge's decision, the deems necessary. The administrative judge shall Board's final decision, or the Commission's deci- serve all orders to produce evidence on both sion on appeal is not more favorable than the offer, parties. then, except where the interest of justice would not (2) Administrative judges are authorized to administer be served, the complainant shall not receive pay- oaths. Statements of witnesses shall be made under ment from the Board of attorney's fees or costs oath or affirmation or, alternatively, by written incurred after the expiration of the 30-day accep- statement under penalty of perjury. tance period. An acceptance of an offer must be (3) When the complainant, or the Board, or its in writing and will be timely if postmarked or employees fail without good cause shown to received within the 30-day period. Where a com- respond fully and in timely fashion to an order plainant fails to accept an offer of resolution, the of an administrative judge, or requests for the Board may make other offers of resolution and investigative file, for documents, records, comeither party may seek to negotiate a settlement of parative data, statistics, affidavits, or the attenthe complaint at any time. dance of witness(es), the administrative judge shall, in appropriate circumstances: (d) Discovery. The administrative judge shall notify the parties of the right to seek discovery prior to the (i) Draw an adverse inference that the requested Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

282 Federal Reserve Bulletin • June 2003 information, or the testimony of the requested sion, an administrative judge shall issue a decision witness, would have reflected unfavorably on on the complaint, and shall order appropriate remethe party refusing to provide the requested dies and relief where discrimination is found, within information; 180 days of receipt by the administrative judge of the (ii) Consider the matters to which the requested complaint file from the Board. The administrative information or testimony pertains to be estab- judge shall send copies of the hearing record, including lished in favor of the opposing party; the transcript, and the decision to the parties. If the (iii) Exclude other evidence offered by the party Board does not issue a final order within 40 days of failing to produce the requested information receipt of the administrative judge's decision in accoror witness; dance with section 268.109(a), then the decision of the (iv) Issue a decision fully or partially in favor of administrative judge shall become the final action of the opposing party; or the Board. (v) Take such other actions as appropriate. (g) Decisions without hearing. Section 268.109—Final action by the Board. (1) If a party believes that some or all material facts are not in genuine dispute and there is no genuine (a) Final action by the Board following a decision by an issue as to credibility, the party may, at least administrative judge. When an EEOC administrative 15 days prior to the date of the hearing or at such judge has issued a decision under sections 268.108(b), earlier time as required by the administrative (g), or (i), the Board shall take final action on the judge, file a statement with the administrative complaint by issuing a final order within 40 days of judge prior to the hearing setting forth the fact or receipt of the hearing file and the administrative facts and referring to the parts of the record relied judge's decision. The final order shall notify the comon to support the statement. The statement must plainant whether or not the Board will fully implement demonstrate that there is no genuine issue as to the decision of the administrative judge and shall conany such material fact. The party shall serve the tain notice of the complainant's right to appeal to the statement on the opposing party. Equal Employment Opportunity Commission, the right (2) The opposing party may file an opposition within to file a civil action in federal district court, the name 15 days of receipt of the statement in para- of the proper defendant in any such lawsuit and the graph (g)(1) of this section. The opposition may applicable time limits for appeals and lawsuits. If the refer to the record in the case to rebut the state- final order does not fully implement the decision of ment that a fact is not in dispute or may file an the administrative judge, then the Board shall simulaffidavit stating that the party cannot, for reasons taneously file an appeal in accordance with secstated, present facts to oppose the request. After tion 268.403 and append a copy of its appeal to the considering the submissions, the administrative final order. A copy of EEOC Form 573 shall be judge may order that discovery be permitted on the attached to the final order. fact or facts involved, limit the hearing to the (b) Final action by the Board in all other circumstances. issues remaining in dispute, issue a decision with- When the Board dismisses an entire complaint under out a hearing or make such other ruling as is section 268.106, receives a request for an immediate appropriate. final decision or does not receive a reply to the notice (3) If the administrative judge determines upon his or issued under section 268.107(f), the Board shall take her own initiative that some or all facts are not in final action by issuing a final decision. The final decigenuine dispute, he or she may, after giving notice sion shall consist of findings by the Board on the to the parties and providing them an opportunity to merits of each issue in the complaint, or, as approprirespond in writing within 15 calendar days, issue ate, the rationale for dismissing any claims in the an order limiting the scope of the hearing or issue complaint and, when discrimination is found, appropria decision without holding a hearing. ate remedies and relief in accordance with subpart F (h) Record of hearing. The hearing shall be recorded and of this part. The Board shall issue the final decision the Board shall arrange and pay for verbatim tran- within 60 days of receiving notification that a comscripts. All documents submitted to, and accepted by, plainant has requested an immediate decision from the the administrative judge at the hearing shall be made Board, or within 60 days of the end of the 30-day part of the record of the hearing. If the Board submits a period for the complainant to request a hearing or an document that is accepted, it shall furnish a copy of the immediate final decision where the complainant has document to the complainant. If the complainant sub- not requested either a hearing or a decision. The final mits a document that is accepted, the administrative action shall contain notice of the right to appeal the judge shall make the document available to the Board's final action to the Equal Employment Opportunity representative for reproduction. Commission, the right to file a civil action in federal (i) Decisions by administrative judges. Unless the admin- district court, the name of the proper defendant in any istrative judge makes a written determination that good such lawsuit and the applicable time limits for appeals cause exists for extending the time for issuing a deci- and lawsuits. A copy of EEOC Form 573 shall be Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 283 attached to the final action. The Board may issue a applied under Titles I and V (sections 501 through 504 final decision within 30 days after receiving a decision and 510) of the Americans with Disabilities Act of of the Commission pursuant to section 268.405(c) of 1990, as amended (42 U.S.C. 12101, 12111, 12201), as this part. such sections relate to employment. These standards are set forth in the Commission's ADA regulation at Subpart C—Provisions Applicable to Particular 29 C.F.R. Part 1630. Complaints Section 268.204—Class complaints. Section 268.201—Age Discrimination in Employment Act. (a) Definitions. (1) Class is a group of Board employees, former (a) As an alternative to filing a complaint under this part, employees or applicants for employment who, it is an aggrieved individual may file a civil action in a alleged, have been or are being adversely affected United States district court under the ADEA against by a Board personnel management policy or practhe Chairman of the Board of Governors after giving tice that discriminates against the group on the the Commission not less than 30 days' notice of the basis of their race, color, religion, sex, national intent to file such an action. Such notice must be filed origin, age or disability. in writing with EEOC, at P.O. Box 19848, Washing- (2) Class complaint is a written complaint of discrimiton, D.C. 20036, or by personal delivery or facsimile nation filed on behalf of a class by the agent of the within 180 days of the occurrence of the alleged class alleging that: unlawful practice. (i) The class is so numerous that a consolidated (b) The Commission may exempt a position from the complaint of the members of the class is provisions of the ADEA if the Commission establishes impractical; a maximum age requirement for the position on the (ii) There are questions of fact common to the basis of a determination that age is a bona fide occupa- class; tional qualification necessary to the performance of the (iii) The claims of the agent of the class are typiduties of the position. cal of the claims of the class; (c) When an individual has filed an administrative com- (iv) The agent of the class, or, if represented, the plaint alleging age discrimination that is not a mixed representative, will fairly and adequately procase, administrative remedies will be considered to be tect the interests of the class. exhausted for purposes of filing a civil action: (3) An agent of the class is a class member who acts (1) 180 days after the filing of an individual complaint for the class during the processing of the class if the Board has not taken final action and the complaint. individual has not filed an appeal or 180 days after (b) Pre-complaint processing. An employee or applicant the filing of a class complaint if the Board has not who wishes to file a class complaint must seek counissued a final decision; seling and be counseled in accordance with sec- (2) After final action on an individual or class com- tion 268.104. A complainant may move for class certiplaint if the individual has not filed an appeal; or fication at any reasonable point in the process when it (3) After the issuance of a final decision by the Com- becomes apparent that there are class implications to mission on an appeal or 180 days after the filing of the claim raised in an individual complaint. If a coman appeal, if the Commission has not issued a final plainant moves for class certification after completing decision. the counseling process contained in section 268.104, no additional counseling is required. The administra- Section 268.202—Equal Pay Act. tive judge shall deny class certification when the complainant has unduly delayed in moving for certification. Complaints alleging violations of the Equal Pay Act shall (c) Filing and presentation of a class complaint. be processed under this part. (1) A class complaint must be signed by the agent or representative and must identify the policy or prac- Section 268.203—Rehabilitation Act. tice adversely affecting the class as well as the specific action or matter affecting the class agent. (a) Model employer. The Board shall be a model employer (2) The complaint must be filed with the Board not of individuals with disabilities. The Board shall give later than 15 days after the agent's receipt of the full consideration to the hiring, placement, and notice of right to file a class complaint. advancement of qualified individuals with disabilities. (3) The complaint shall be processed promptly; the (b) ADA standards. The standards used to determine parties shall cooperate and shall proceed at all whether section 501 of the Rehabilitation Act of 1973, times without undue delay. as amended (29 U.S.C. 791), has been violated in a (d) Acceptance or dismissal. complaint alleging nonaffirmative action employment (1) Within 30 days of the Board's receipt of a comdiscrimination under this part shall be the standards plaint, the Board shall: Designate an agency repre- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

284 Federal Reserve Bulletin • June 2003 sentative who shall not be one of the individuals in accordance with section 268.403 and append a referenced in section 268.102(b)(4), and forward copy of the appeal to the final order. A dismissal of the complaint, along with a copy of the Counse- a class complaint shall inform the agent either that lor's report and any other information pertaining to the complaint is being filed on that date as an timeliness or other relevant circumstances related individual complaint of discrimination and will be to the complaint, to the Commission. The Com- processed under subpart B or that the complaint is mission shall assign the complaint to an adminis- also dismissed as an individual complaint in accortrative judge or complaints examiner with a proper dance with section 268.106. In addition, it shall security clearance when necessary. The adminis- inform the agent of the right to appeal the distrative judge may require the complainant or the missal of the class complaint to the Equal Employ- Board to submit additional information relevant to ment Opportunity Commission or to file a civil the complaint. action and shall include EEOC Form 573, Notice (2) The administrative judge may dismiss the com- of Appeal/Petition. plaint, or any portion, for any of the reasons listed (e) Notification. in section 268.106 or because it does not meet (1) Within 15 days of receiving notice that the adminthe prerequisites of a class complaint under sec- istrative judge has accepted a class complaint or a tion 268.204(a)(2). reasonable time frame specified by the administra- (3) If an allegation is not included in the Counselor's tive judge, the Board shall use reasonable means, report, the administrative judge shall afford the such as delivery, mailing to last known address or agent 15 days to state whether the matter was distribution, to notify all class members of the discussed with the Counselor and, if not, explain acceptance of the class complaint. why it was not discussed. If the explanation is not (2) Such notice shall contain: satisfactory, the administrative judge shall dismiss (i) An identification of the Board as the named the allegation. If the explanation is satisfactory, the agency, its location, and the date of accepadministrative judge shall refer the allegation to tance of the complaint; the Board for further counseling of the agent. After (ii) A description of the issues accepted as part of counseling, the allegation shall be consolidated the class complaint; with the class complaint. (iii) An explanation of the binding nature of the (4) If an allegation lacks specificity and detail, the final decision or resolution of the class comadministrative judge shall afford the agent 15 days plaint on class members; and to provide specific and detailed information. The (iv) The name, address and telephone number of administrative judge shall dismiss the complaint if the class representative. the agent fails to provide such information within (f) Obtaining evidence concerning the complaint. the specified time period. If the information pro- (1) The administrative judge shall notify the agent and vided contains new allegations outside the scope the Board's representative of the time period that of the complaint, the administrative judge shall will be allowed both parties to prepare their cases. advise the agent how to proceed on an individual This time period will include at least 60 days and or class basis concerning these allegations. may be extended by the administrative judge upon (5) The administrative judge shall extend the time the request of either party. Both parties are entitled limits for filing a complaint and for consulting to reasonable development of evidence on matters with a Counselor in accordance with the time relevant to the issues raised in the complaint. Evilimit extension provisions contained in sec- dence may be developed through interrogatories, tions 268.104(a)(2) and 268.604. depositions, and requests for admissions, stipulations or production of documents. It shall be (6) When appropriate, the administrative judge may grounds for objection to producing evidence that decide that a class be divided into subclasses and the information sought by either party is irrelevant, that each subclass be treated as a class, and the overburdensome, repetitious, or privileged. provisions of this section then shall be construed and applied accordingly. (2) If mutual cooperation fails, either party may (7) The administrative judge shall transmit his or her request the administrative judge to rule on a decision to accept or dismiss a complaint to the request to develop evidence. If a party fails with- Board and the agent. The Board shall take final out good cause shown to respond fully and in action by issuing a final order within 40 days of timely fashion to a request made or approved by receipt of the hearing record and administrative the administrative judge for documents, records, judge's decision. The final order shall notify the comparative data, statistics or affidavits, and the agent whether or not the Board will implement information is solely in the control of one party, such failure may, in appropriate circumstances, the decision of the administrative judge. If the cause the administrative judge: final order does not implement the decision of the administrative judge, the Board shall simulta- (i) To draw an adverse inference that the neously appeal the administrative judge's decision requested information would have reflected Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 285 unfavorably on the party refusing to provide and include EEOC Form 573, Notice of Appeal/ the requested information; Petition. If the administrative judge finds that the (ii) To consider the matters to which the resolution is fair, adequate and reasonable to the requested information pertains to be estab- class as a whole, the resolution shall bind all lished in favor of the opposing party; members of the class. (iii) To exclude other evidence offered by the (h) Hearing. On expiration of the period allowed for party failing to produce the requested preparation of the case, the administrative judge shall information; set a date for hearing. The hearing shall be con- (iv) To recommend that a decision be entered in ducted in accordance with 12 C.F.R. §268.108(a) favor of the opposing party; or through (f). (v) To take such other actions as the administra- (i) Report of findings and recommendations. tive judge deems appropriate. (1) The administrative judge shall transmit to the (3) During the period for development of evidence, Board a report of findings and recommendations the administrative judge may, in his or her discre- on the complaint, including a recommended decition, direct that an investigation of facts relevant to sion, systemic relief for the class and any indithe class complaint or any portion be conducted by vidual relief, where appropriate, with regard to the an agency certified by the Commission. personnel action or matter that gave rise to the (4) Both parties shall furnish to the administrative complaint. judge copies of all materials that they wish to be (2) If the administrative judge finds no class relief examined and such other material as may be appropriate, he or she shall determine if a finding requested. of individual discrimination is warranted and, if (g) Opportunity for resolution of the complaint. so, shall recommend appropriate relief. (1) The administrative judge shall furnish the agent (3) The administrative judge shall notify the agent of and the Board's representative a copy of all mate- the date on which the report of findings and recomrials obtained concerning the complaint and pro- mendations was forwarded to the Board. vide opportunity for the agent to discuss the mate- (j) Board decision. rials with the Board's representative and attempt (1) Within 60 days of receipt of the report of findresolution of the complaint. ings and recommendations issued under sec- (2) The complaint may be resolved by agreement of tion 268.204(i), the Board shall issue a final decithe Board and the agent at any time pursuant to the sion, which shall accept, reject, or modify the notice and approval procedure contained in para- findings and recommendations of the administragraph (g)(4) of this section. tive judge. (3) If the complaint is resolved, the terms of the reso- (2) The final decision of the Board shall be in writing lution shall be reduced to writing and signed by and shall be transmitted to the agent by certified the agent and the Board. mail, return receipt requested, along with a copy of (4) Notice of the resolution shall be given to all class the report of findings and recommendations of the members in the same manner as notification of the administrative judge. acceptance of the class complaint and to the (3) When the Board's final decision is to reject or administrative judge. It shall state the relief, if any, modify the findings and recommendations of the to be granted by the Board and the name and administrative judge, the decision shall contain address of the EEOC administrative judge assigned specific reasons for the Board's action. to the case. It shall state that within 30 days of the (4) If the Board has not issued a final decision within date of the notice of resolution, any member of the 60 days of its receipt of the administrative judge's class may petition the administrative judge to report of findings and recommendations, those vacate the resolution because it benefits only the findings and recommendations shall become the class agent, or is otherwise not fair, adequate and final decision. The Board shall transmit the final reasonable to the class as a whole. The administra- decision to the agent within five days of the expirative judge shall review the notice of resolution and tion of the 60-day period. consider any petitions to vacate filed. If the admin- (5) The final decision of the Board shall require any istrative judge finds that the proposed resolution is relief authorized by law and determined to be not fair, adequate and reasonable to the class as a necessary or desirable to resolve the issue of whole, the administrative judge shall issue a deci- discrimination. sion vacating the agreement and may replace the (6) The final decision on a class complaint shall, suboriginal class agent with a petitioner or some other ject to subpart E of this part, be binding on all class member who is eligible to be the class agent members of the class and the Board. during further processing of the class complaint. (7) The final decision shall inform the agent of the The decision shall inform the former class agent or right to appeal or to file a civil action in accorthe petitioner of the right to appeal the decision to dance with subpart E of this part and of the applithe Equal Employment Opportunity Commission cable time limits. 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286 Federal Reserve Bulletin • June 2003 (k) Notification of decision. The Board shall notify class civil action in accordance with subpart E of this members of the final decision and relief awarded, part and the applicable time limits. if any, through the same media employed to give notice of the existence of the class complaint. The Section 268.205—Employment of noncitizens. notice, where appropriate, shall include information concerning the rights of class members to seek (a) Definitions. The definitions contained in this paragraph individual relief, and of the procedures to be followed. (a) shall apply only to this section. Notice shall be given by the Board within (1) Intending citizen means a citizen or national of the 10 days of the transmittal of its final decision to the United States, or a noncitizen who: agent. (i) Is a protected individual as defined in 8 U.S.C. (1) Relief for individual class members. When dis- 1324b(a)(3); and crimination is found, the Board must eliminate or (ii) Has evidenced an intention to become a modify the employment policy or practice out United States citizen. of which the complaint arose and provide indi- (2) Noncitizen means any person who is not a citizen vidual relief, including an award of attorney's fees of the United States. and costs, to the agent in accordance with sec- (3) Sensitive information means: tion 268.501. (i) (A) Information that is classified for national (2) When class-wide discrimination is not found, but security purposes under Executive Order it is found that the class agent is a victim of No. 12356 (3 C.F.R. 1982 Comp., p. 166), discrimination, section 268.501 shall apply. The including any amendments or supersed- Board shall also, within 60 days of the issuance ing orders that the President of the United of the final decision finding no class-wide dis- States may issue from time to time; crimination, issue the acknowledgment of receipt (B) Information that consists of confidential of an individual complaint as required by sec- supervisory information of the Board, as tion 268.105(d) and process in accordance with defined in 12 C.F.R. 261.2(c); or the provisions of subpart B of this part, each (C) Information the disclosure or premature individual complaint that was subsumed into the disclosure of which to unauthorized perclass complaint. sons may be reasonably likely to impair (3) When discrimination is found in the final decision the formulation or implementation of and a class member believes that he or she is monetary policy, or cause unnecessary or entitled to individual relief, the class member may unwarranted disturbances in securities or file a written claim with the Board or the Board's other financial markets, such that access EEO Programs Director within 30 days of receipt to such information must be limited to of notification by the Board of its final decision. persons who are loyal to the United Administrative judges shall retain jurisdiction over States. the complaint in order to resolve any disputed (ii) For purposes of paragraph (a)(3)(i)(C) of this claims by class members. The claim must include section, information may not be deemed sensia specific, detailed showing that the claimant is a tive information merely because it would be class member who was affected by the discrimina- exempt from disclosure under the Freedom of tory policy or practice, and that this discriminatory Information Act (5 U.S.C. 552) but sensitive action took place within the period of time for information must be information the unauthowhich the Board found class-wide discrimination rized disclosure or premature disclosure of in its final decision. Where a finding of discrimina- which may be reasonably likely to impair tion against a class has been made, there shall be a important functions or operations of the presumption of discrimination as to each member Board. of the class. The Board must show by clear and (4) Sensitive position means any position of employconvincing evidence that any class member is not ment in which the employee will be required to entitled to relief. The administrative judge may have access to sensitive information. hold a hearing or otherwise supplement the record (b) Prohibitions. on a claim filed by a class member. The Board or (1) Unauthorized aliens. The Board shall not hire any the Commission may find class-wide discrimina- person unless that person is able to satisfy the tion and order remedial action for any policy or requirements of Section 101 of the Immigration practice in existence within 45 days of the agent's Reform and Control Act of 1986. initial contact with the Counselor. Relief otherwise (2) Employment in sensitive positions. The Board shall consistent with this Part may be ordered for the not hire any person to a sensitive position unless time the policy or practice was in effect. The such person is a citizen of the United States or, if a Board shall issue a final decision on each such noncitizen, is an intending citizen. claim within 90 days of filing. Such decision must (3) Preference. Consistent with the Immigration include a notice of the right to file an appeal or a Reform and Control Act of 1986, and other appli- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 287 cable law, applicants for employment at the Board 29 C.F.R. to the processing of a mixed case complaint or who are citizens of the United States shall be mixed case appeal. preferred over equally qualified applicants who are not United States citizens. Subpart E—Appeals to the Equal Employment (c) Exception. The prohibition of paragraph (b)(2) of this Opportunity Commission section does not apply to hiring for positions for which a security clearance is required under Executive Order Section 268.401—Appeals to the Equal Employment No. 10450, including any subsequent amendments or Opportunity Commission. superseding orders that the President of the United States may issue from time to time, where the nonciti- (a) A complainant may appeal the Board's final action or zen either has or can obtain the necessary security dismissal of a complaint. clearance. Any offer of employment authorized by this (b) The Board may appeal as provided in section paragraph (c) shall be contingent upon receipt of the 268.109(a). required security clearance in the manner prescribed (c) A class agent or the Board may appeal an administraby law. tive judge's decision accepting or dismissing all or part (d) Applicability. This section applies to employment of a class complaint; a class agent may appeal a final in all positions at the Board and to employment by decision on a class complaint; a class member may Federal Reserve Banks of examiners who must be appeal a final decision on a claim for individual relief appointed, or selected and approved by the Board under a class complaint; and a class member, a class pursuant to 12 U.S.C. 325, 326, 338, or 625. agent or the Board may appeal a final decision on a petition pursuant to section 268.204(g)(4). (d) A complainant, agent of the class or individual class Subpart D—Related Processes claimant may appeal to the Commission the Board's alleged noncompliance with a settlement agreement or Section 268.301—Negotiated grievance procedure. final decision in accordance with section 268.504. When an employee of the Board, which is not an agency Section 268.402—Time for appeals to the Equal subject to 5 U.S.C. 7121(d), is covered by a negotiated Employment Opportunity Commission. grievance procedure, allegations of discrimination shall be processed as complaints under this part, except that the (a) Appeals described in section 268.401 (a) and (c) must time limits for processing the complaint contained in sec- be filed within 30 days of receipt of the dismissal, tion 268.105 and for appeal to the Commission contained final action or decision. Appeals described in secin section 268.402 may be held in abeyance during process- tion 268.401(b) must be filed within 40 days of receipt ing of a grievance covering the same matter as the com- of the hearing file and decision. Where a complainant plaint if the Board notifies the complainant in writing that has notified the Board's EEO Programs Director of the complaint will be held in abeyance pursuant to this alleged noncompliance with a settlement agreement in section. accordance with section 268.504, the complainant may file an appeal 35 days after service of the allegations of noncompliance, but no later than 30 days after receipt Section 268.302—Mixed case complaints. of the Board's determination. (b) If the complainant is represented by an attorney of A mixed case complaint is a complaint of employment record, then the 30-day time period provided in paradiscrimination filed with the Board based on race, color, graph (a) of this section within which to appeal shall religion, sex, national origin, age or disability related to or be calculated from the receipt of the required docustemming from an action that can be appealed to the Merit ment by the attorney. In all other instances, the time System Protection Board (MSPB). The complaint may within which to appeal shall be calculated from the contain only an allegation of employment discrimination or receipt of the required document by the complainant. it may contain additional allegations that the MSPB has jurisdiction to address. A mixed case appeal is an appeal Section 268.403—How to appeal. filed with the MSPB that alleges that an appealable Board action was effected, in whole or in part, because of (a) The complainant, the Board, agent or individual class discrimination on the basis of race, color, religion, sex, claimant (hereinafter appellant) must file an appeal national origin, disability or age. Only a Board employee with the Director, Office of Federal Operations, Equal who is a preference eligible employee as defined by the Employment Opportunity Commission, at P.O. Box Veterans Preference Act can file a mixed case complaint 19848, Washington, DC 20036, or by personal delivwith the Board or a mixed case appeal with the MSPB. A ery or facsimile. The appellant should use EEOC mixed case complaint or mixed case appeal may only be Form 573, Notice of Appeal/Petition, and should indifiled for action(s) over which the MSPB has jurisdiction. cate what is being appealed. The Board will apply sections 1614.302 to 1614.310 of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

288 Federal Reserve Bulletin • June 2003 (b) The appellant shall furnish a copy of the appeal to the Section 268.405—Decisions on appeals. opposing party at the same time it is filed with the Commission. In or attached to the appeal to the Com- (a) The Office of Federal Operations, on behalf of the mission, the appellant must certify the date and method Commission, shall issue a written decision setting forth by which service was made on the opposing party. its reasons for the decision. The Commission shall (c) If an appellant does not file an appeal within the time dismiss appeals in accordance with sections 268.106, limits of this subpart, the appeal shall be dismissed by 268.403(c) and 268.408. The decision on an appeal the Commission as untimely. from the Board's final action shall be based on a (d) Any statement or brief on behalf of a complainant in de novo review, except that the review of the factual support of the appeal must be submitted to the Office findings in a decision by an administrative judge issued of Federal Operations within 30 days of filing the pursuant to section 268.108(i) shall be based on a notice of appeal. Any statement or brief on behalf of substantial evidence standard of review. If the decision the Board in support of its appeal must be submitted to contains a finding of discrimination, appropriate remthe Office of Federal Operations within 20 days filing edy(ies) shall be included and, where appropriate, the the notice of appeal. The Office of Federal Operations entitlement to interest, attorney's fees or costs shall will accept statements or briefs in support of an appeal be indicated. The decision shall reflect the date of its by facsimile transmittal, provided they are no more issuance, inform the complainant of his or her civil than 10 pages long. action rights, and be transmitted to the complainant (e) The Board must submit the complaint file to the Office and the Board by first class mail. of Federal Operations within 30 days of initial notifica- (b) A decision issued under paragraph (a) of this section is tion that the complainant has filed an appeal or within final, subject to paragraph (c) of this section, within the 30 days of submission of an appeal by the Board. meaning of section 268.406 unless the Commission (f) Any statement or brief in opposition to an appeal must reconsiders the case. A party may request reconsidbe submitted to the Commission and served on the eration within 30 days of receipt of a decision of the opposing party within 30 days of receipt of the state- Commission, which the Commission in its discretion ment or brief supporting the appeal, or, if no statement may grant, if the party demonstrates that: or brief supporting the appeal is filed, within 60 days (1) The appellate decision involved a clearly erroneof receipt of the appeal. The Office of Federal Opera- ous interpretation of material fact or law; or tions will accept statements or briefs in opposition to (2) The decision will have a substantial impact on the an appeal by facsimile provided they are no more than policies, practices or operations of the Board. 10 pages long. (c) The Board, within 30 days of receiving the decision of the Commission, shall issue a final decision based Section 268.404—Appellate Procedure. upon that decision. (a) On behalf of the Commission, the Office of Federal Section 268.406—Civil action: Title VII, Age Operations shall review the complaint file and all writ- Discrimination in Employment Act and ten statements and briefs from either party. The Com- Rehabilitation Act. mission may supplement the record by an exchange of letters or memoranda, investigation, remand to the A complainant who has filed an individual complaint, an Board or other procedures. agent who has filed a class complaint or a claimant who (b) If the Office of Federal Operations requests informa- has filed a claim for individual relief pursuant to a class tion from one or both of the parties to supplement the complaint is authorized under title VII, the ADEA and the record, each party providing information shall send a Rehabilitation Act to file a civil action in an appropriate copy of the information to the other party. United States District Court: (c) When either party to an appeal fails without good (a) Within 90 days of receipt of the final action on an cause shown to comply with the requirements of this individual or class complaint if no appeal has been section or to respond fully and in timely fashion to filed; requests for information, the Office of Federal Opera- (b) After 180 days from the date of filing an individual or tions shall, in appropriate circumstances: class complaint if an appeal has not been filed and final (1) Draw an adverse inference that the requested action has not been taken; information would have reflected unfavorably (c) Within 90 days of receipt of the Commission's final on the party refusing to provide the requested decision on an appeal; or information; (d) After 180 days from the date of filing an appeal with (2) Consider the matters to which the requested infor- the Commission if there has been no final decision by mation or testimony pertains to be established in the Commission. favor of the opposing party; (3) Issue a decision fully or partially in favor of the Section 268.407—Civil action: Equal Pay Act. opposing party; or (4) Take such other actions as appropriate. A complainant is authorized under section 16(b) of the Fair Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 289 Labor Standards Act (29 U.S.C. 216(b)) to file a civil made in writing. The individual shall have action in a court of competent jurisdiction within two years 15 days from receipt of the offer within which or, if the violation is willful, three years of the date of the to accept or decline the offer. Failure to accept alleged violation of the Equal Pay Act regardless of the offer within the 15-day period will be whether he or she pursued any administrative complaint considered a declination of the offer, unless processing. Recovery of back wages is limited to two years the individual can show that circumstances prior to the date of filing suit, or to three years if the beyond his or her control prevented a violation is deemed willful; liquidated damages in an equal response within the time limit, amount may also be awarded. The filing of a complaint or (ii) If the offer is accepted, appointment shall be appeal under this part shall not toll the time for filing a civil retroactive to the date the applicant would action. have been hired. Back pay, computed in the manner prescribed in 5 C.F.R. 550.805, shall Section 268.408—Effect of filing a civil action. be awarded from the date the individual would have entered on duty until the date the Filing a civil action under sections 268.406 or 268.407 individual actually enters on duty unless clear shall terminate Commission processing of the appeal. If and convincing evidence indicates that the private suit is filed subsequent to the filing of an appeal, the applicant would not have been selected even parties are requested to notify the Commission in writing. absent discrimination. Interest on back pay shall be included in the back pay computation where sovereign immunity has been waived. Subpart F—Remedies and Enforcement The individual shall be deemed to have performed service for the Board during this Section 268.501—Remedies and relief. period for all purposes except for meeting service requirements for completion of a (a) When the Board, or the Commission, in an individual required probationary or trial period, case of discrimination, finds that an applicant or an (iii) If the offer of employment is declined, the employee has been discriminated against, the Board Board shall award the individual a sum equal shall provide full relief which shall include the followto the back pay he or she would have ing elements in appropriate circumstances: received, computed in the manner prescribed (1) Notification to all employees of the Board in the in 5 C.F.R. 550.805, from the date he or she affected facility of their right to be free of unlawful would have been appointed until the date the discrimination and assurance that the particular offer was declined, subject to the limitation types of discrimination found will not recur; of paragraph (b)(3) of this section. Interest on (2) Commitment that corrective, curative or prevenback pay shall be included in the back pay tive action will be taken, or measures adopted, to computation. The Board shall inform the ensure that violations of the law similar to those applicant, in its offer of employment, of the found unlawful will not recur; right to this award in the event the offer is (3) An unconditional offer to each identified victim of declined. discrimination of placement in the position the person would have occupied but for the discrimi- (2) When the Board, or the Commission, finds that nation suffered by that person, or a substantially discrimination existed at the time the applicant equivalent position; was considered for employment but also finds by (4) Payment to each identified victim of discrimina- clear and convincing evidence that the applicant tion on a make whole basis for any loss of earnings would not have been hired even absent discriminathe person may have suffered as a result of the tion, the Board shall nevertheless take all steps discrimination; and necessary to eliminate the discriminatory practice (5) Commitment that the Board shall cease from and ensure it does not recur. engaging in the specific unlawful employment (3) Back pay under this paragraph (b) for complaints practice found in the case. under title VII or the Rehabilitation Act may not (b) Relief for an applicant. extend from a date earlier than two years prior to (1) (i) When the Board, or the Commission, finds the date on which the complaint was initially filed that an applicant for employment has been by the applicant. discriminated against, the Board shall offer (c) Relief for an employee. When the Board, or the Comthe applicant the position that the applicant mission, finds that an employee of the Board was would have occupied absent discrimination discriminated against, the Board shall provide relief, or, if justified by the circumstances, a substan- which shall include, but need not be limited to, one or tially equivalent position unless clear and more of the following actions: convincing evidence indicates that the appli- (1) Nondiscriminatory placement, with back pay comcant would not have been selected even puted in the manner prescribed in 5 C.F.R. absent the discrimination. The offer shall be 550.805, unless clear and convincing evidence Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

290 Federal Reserve Bulletin • June 2003 contained in the record demonstrates that the per- performed during the pre-complaint process, sonnel action would have been taken even absent except that fees are allowable when the Comthe discrimination. Interest on back pay shall be mission affirms on appeal an administrative included in the back pay computation where sov- judge's decision finding discrimination after ereign immunity has been waived. The back pay the Board takes final action by not impleliability under title VII or the Rehabilitation Act is menting an administrative judge's decision. limited to two years prior to the date the discrimi- Written submissions to the Board that are nation complaint was filed. signed by the representative shall be deemed (2) If clear and convincing evidence indicates that, to constitute notice of representation. although discrimination existed at the time the (2) Amount of awards. personnel action was taken, the personnel action (i) When the Board, administrative judge or the would have been taken even absent discrimina- Commission determines an entitlement to tion, the Board shall nevertheless eliminate any attorney's fees or costs, the complainant's discriminatory practice and ensure it does not attorney shall submit a verified statement of recur. attorney's fees (including expert witness fees) (3) Cancellation of an unwarranted personnel action and other costs, as appropriate, to the Board and restoration of the employee. or administrative judge within 30 days of (4) Expunction from the Board's records of any receipt of the decision and shall submit a adverse materials relating to the discriminatory copy of the statement to the Board. A stateemployment practice. ment of attorney's fees and costs shall be (5) Full opportunity to participate in the employee accompanied by an affidavit executed by the benefit denied (e.g., training, preferential work attorney of record itemizing the attorney's assignments, overtime scheduling). charges for legal services. The Board may (d) The Board has the burden of proving by a preponder- respond to a statement of attorney's fees and ance of the evidence that the complainant has failed to costs within 30 days of its receipt. The verimitigate his or her damages. fied statement, accompanying affidavit and (e) Attorney's fees or costs— any Board response shall be made a part of (1) Awards of attorney's fees or costs. The provisions the complaint file. of this paragraph relating to the award of attor- (ii) (A) The Board or administrative judge shall ney's fees or costs shall apply to allegations of issue a decision determining the amount discrimination prohibited by title VII and the of attorney's fees or costs due within Rehabilitation Act. In a decision or final action, 60 days of receipt of the statement and the Board, administrative judge, or Commission affidavit. The decision shall include a may award the applicant or employee or reason- notice of right to appeal to the EEOC able attorney's fees (including expert witness fees) along with EEOC Form 573, Notice of and other costs incurred in the processing of the Appeal/Petition and shall include the complaint. specific reasons for determining the (i) A finding of discrimination raises a presump- amount of the award. tion of entitlement to an award of attorney's (B) The amount of attorney's fees shall be fees. calculated using the following standards: (ii) Any award of attorney's fees or costs shall be The starting point shall be the number paid by the Board. of hours reasonably expended multiplied (iii) Attorney's fees are allowable only for the by a reasonable hourly rate. There is a services of members of the Bar and law strong presumption that this amount repclerks, paralegals or law students under the resents the reasonable fee. In limited cirsupervision of members of the Bar, except cumstances, this amount may be reduced that no award is allowable for the services of or increased in consideration of the any employee of the Federal Government. degree of success, quality of represen- (iv) Attorney's fees shall be paid for services per- tation, and long delay caused by the formed by an attorney after the filing of a Board. written complaint, provided that the attorney (C) The costs that may be awarded are those provides reasonable notice of representation authorized by 28 U.S.C. 1920 to include: to the Board, administrative judge or Com- Fees of the reporter for all or any of mission, except that fees are allowable for a the stenographic transcript necessarily reasonable period of time prior to the notifica- obtained for use in the case; fees and tion of representation for any services per- disbursements for printing and witformed in reaching a determination to repre- nesses; and fees for exemplification and sent the complainant. The Board is not copies necessarily obtained for use in the required to pay attorney's fees for services case. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 291 (iii) Witness fees shall be awarded in accordance Section 268.503—Enforcement of final EEOC with the provisions of 28 U.S.C. 1821, except decisions. that no award shall be made for a Federal employee who is in a duty status when made (a) Petition for enforcement. A complainant may petition available as a witness. the Commission for enforcement of a decision issued under the Commission's appellate jurisdiction. The Section 268.502—Compliance with final Commission petition shall be submitted to the Office of Federal decisions. Operations. The petition shall specifically set forth the reasons that lead the complainant to believe that the (a) Relief ordered in a final Commission decision, if Board is not complying with the decision. accepted pursuant to section 268.405(c) as a final (b) Compliance. On behalf of the Commission, the Office decision, or not acted upon the Board within the time of Federal Operations shall take all necessary action to periods of section 268.405(c), is mandatory and bind- ascertain whether the Board is implementing the deciing on the Board except as provided in this section. sion of the Commission. If the Board is found not to be Failure to implement ordered relief shall be sub- in compliance with the decision, efforts shall be underject to judicial enforcement as specified in sec- taken to obtain compliance. tion 268.503(f). (c) Clarification. On behalf of the Commission, the Office (b) Notwithstanding paragraph (a) of this section, when of Federal Operations may, on its own motion or in the Board requests reconsideration and the case response to a petition for enforcement or in connecinvolves removal, separation, or a suspension continu- tion with a timely request for reconsideration, issue a ing beyond the date of the request for reconsideration, clarification of a prior decision. A clarification cannot and when the decision orders retroactive restoration, change the result of a prior decision or enlarge or the Board shall comply with the decision to the extent diminish the relief ordered but may further explain the of the temporary or conditional restoration of the meaning or intent of the prior decision. employee to duty status in the position specified by the (d) Referral to the Commission. Where the Director, Office Commission, pending the outcome of the Board's of Federal Operations, is unable to obtain satisfactory request for reconsideration. compliance with the final decision, the Director shall (1) Service under the temporary or conditional restora- submit appropriate findings and recommendations for tion provisions of this paragraph (b) shall be cred- enforcement to the Commission, or, as directed by the ited toward the completion of a probationary or Commission, refer the matter to another appropriate trial period or the completion of the service agency. requirement for career tenure, if the Commission (e) Commission notice to show cause. The Commission upholds its decision after reconsideration. may issue a notice to the Chairman of the Board to (2) When the Board requests reconsideration, it may show cause why there is noncompliance. Such notice delay the payment of any amounts ordered to be may request the Chairman of the Board or a reprepaid to the complainant until after the request for sentative to appear before the Commission or to reconsideration is resolved. If the Board delays respond to the notice in writing with adequate evipayment of any amount pending the outcome of dence of compliance or with compelling reasons for the request to reconsider and the resolution of the noncompliance. request requires the Board to make the payment, (f) Notification to complainant of completion of administhen the Board shall pay interest from the date trative efforts. Where the Commission has determined of the original appellate decision until payment is that the Board is not complying with a prior decision, made. or where the Board has failed or refused to submit any (3) The Board shall notify the Commission and the required report of compliance, the Commission shall employee in writing at the same time it requests notify the complainant the right to file a civil action for reconsideration that the relief it provides is tempo- enforcement of the decision pursuant to title VII, the rary or conditional and, if applicable, that it will ADEA, the Equal Pay Act or the Rehabilitation Act delay the payment of any amounts owed but will and to seek judicial review of the Board's refusal to pay interest as specified in paragraph (b)(2) of this implement the ordered relief pursuant to the Adminissection. Failure of the Board to provide notifica- trative Procedures Act, 5 U.S.C. 701 et seq., and the tion will result in the dismissal of the Board's mandamus statute, 28 U.S.C. 1361, or to commence request. de novo proceedings pursuant to the appropriate statutes. (c) When no request for reconsideration is filed or when a request for reconsideration is denied, the Board shall provide the relief ordered and there is no further right Section 268.504—Compliance with settlement to delay implementation of the ordered relief. The agreements and final actions. relief shall be provided in full not later than 60 days after receipt of the final decision unless otherwise (a) Any settlement agreement knowingly and voluntarily ordered in the decision. agreed to by the parties, reached at any stage of the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

292 Federal Reserve Bulletin • June 2003 complaint process, shall be binding on both parties. increase, or the completion of the service require- Final action that has not been the subject of an appeal ment for career tenure, if the Commission upholds or a civil action shall be binding on the Board. If the the decision on appeal. Such service shall not be complainant believes that the Board has failed to com- credited toward the completion of any applicable ply with the terms of a settlement agreement or deci- probationary or trial period or the completion of sion, the complainant shall notify the Board's EEO the service requirement for career tenure if the Programs Director, in writing, of the alleged noncom- Commission reverses the decision on appeal. pliance within 30 days of when the complainant knew (3) When the Board appeals, it may delay the payment or should have known of the alleged noncompliance. of any amount, other than prospective pay and The complainant may request that the terms of the benefits, ordered to be paid to the complainant settlement agreement be specifically implemented or, until after the appeal is resolved. If the Board alternatively, that the complaint be reinstated for fur- delays payment of any amount pending the outther processing from the point processing ceased. come of the appeal and the resolution of the appeal (b) The Board shall resolve the matter and respond to the requires the Board to make the payment, then the complainant, in writing. If the Board has not responded Board shall pay interest from the date of the origito the complainant, in writing, or if the complainant is nal decision until payment is made. not satisfied with the Board's attempt to resolve the (4) The Board shall notify the Commission and the matter, the complainant may appeal to the Commission employee in writing at the same time it appeals for a determination as to whether the Board has com- that the relief it provides is temporary or condiplied with the terms of the settlement agreement or tional and, if applicable, that it will delay the decision. The complainant may file such an appeal payment of any interest as specified in para- 35 days after he or she has served the Board with the graph (b)(2) of this section. Failure of the Board to allegations of noncompliance, but must file an appeal provide notification will result in the dismissal of within 30 days of his or her receipt of the Board's the Board's appeal. determination. The complainant must serve a copy of (5) The Board may, by notice to the complainant, the appeal on the Board and the Board may submit a decline to return the complainant to his or her response to the Commission within 30 days of receiv- place of employment if it determines that the ing notice of the appeal. return or presence of the complainant will be (c) Prior to rendering its determination, the Commission unduly disruptive to the work environment. Howmay request that the parties submit whatever additional ever, prospective pay and benefits must be proinformation or documentation it deems necessary or vided. The determination not to return the commay direct that an investigation or hearing on the plainant to his or her place of employment is not matter be conducted. If the Commission determines reviewable. A grant of interim relief does not that the Board is not in compliance and the noncompli- insulate a complainant from subsequent disciplinance is not attributable to acts or conduct of the com- ary or adverse action. plainant, it may order such compliance or it may order (b) If the Board files an appeal and has not provided that the complaint be reinstated for further processing required interim relief, the complainant may request from the point processing ceased. Allegations that dismissal of the Board's appeal. Any such request subsequent acts of discrimination violate a settlement must be filed with the Office of Federal Operations agreement shall be processed as separate complaints within 25 days of the date of service of the Board's under sections 268.105 or 268.204, as appropriate, appeal. A copy of the request must be served on the rather than under this section. Board at the same time it is filed with EEOC. The Board may respond with evidence and argument to Section 268.505—Interim relief. the complainant's request to dismiss within 15 days of the date of service of the request. (a) (1) When the Board appeals and the case involves removal, separation, or suspension continuing Subpart G—Matters of General Applicability beyond the date of the appeal, and when the administrative judge orders retroactive restoration, Section 268.601—EEO group statistics. the Board shall comply with the decision to the extent of the temporary or conditional restoration (a) The Board shall establish a system to collect and of the employee to duty status in the position maintain accurate employment information on the specified in the decision, pending the outcome of race, national origin, sex and disability(ies) of its the Board appeal. The employee may decline the employees. offer of interim relief. (b) Data on race, national origin and sex shall be collected (2) Service under the temporary or conditional restora- by voluntary self-identification. If an employee does tion provisions of paragraph (a)(1) of this section not voluntarily provide the requested information, the shall be credited toward the completion of a proba- Board shall advise the employee of the importance of tionary or trial period, eligibility for a within-grade the data and of the Board's obligation to report it. If Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 293 the employee still refuses to provide the information, part at such times and in such manner as the Board and the Board must make a visual identification and inform Commission shall agree. the employee of the data it will be reporting. If the (b) The Board shall advise the Commission whenever it is Board believes that information provided by an served with a Federal court complaint based upon a employee is inaccurate, the Board shall advise the complaint that is pending on appeal at the Commission. employee about the solely statistical purpose for which (c) The Board shall submit annually for the review and the data is being collected, the need for accuracy, the approval of the Commission written equal employment Board's recognition of the sensitivity of the informa- opportunity plans of action. Plans shall be submitted in tion and the existence of procedures to prevent its the format prescribed by the Commission and shall unauthorized disclosure. If, thereafter, the employee include, but not be limited to: declines to change the apparently inaccurate self iden- (1) Provision for the establishment of training and tification, the Board must accept it. education programs designed to provide maximum (c) Subject to applicable law, the information collected opportunity for employees to advance so as to under paragraph (b) of this section shall be disclosed perform at their highest potential; only in the form of gross statistics. The Board shall (2) Description of the qualifications, in terms of trainnot collect or maintain any information on the race, ing and experience relating to equal employment national origin or sex of individual employees except opportunity, of the principal and operating officials in accordance with applicable law and when an auto- concerned with administration of the Board's mated data processing system is used in accordance equal employment opportunity program; and with standards and requirements prescribed by the (3) Description of the allocation of personnel and Commission to insure individual privacy and the sepa- resources proposed by the Board to carry out its ration of that information from personnel records. equal employment opportunity program. (d) The Board's system is subject to the following controls: Section 268.603—Voluntary settlement attempts. (1) Only those categories of race and national origin prescribed by the Commission may be used; The Board shall make reasonable efforts to voluntarily (2) Only the specific procedures for the collection settle complaints of discrimination as early as possible and maintenance of data that are prescribed or in, and throughout, the administrative processing of comapproved by the Commission may be used. plaints, including the pre-complaint counseling stage. Any (e) The Board may use the data only in studies and analy- settlement reached shall be in writing and signed by both ses which contribute affirmatively to achieving the parties and shall identify the claims resolved. objectives of the Board's equal employment opportunity program. The Board shall not establish a quota for Section 268.604—Filing and computation of time. the employment of persons on the basis of race, color, religion, sex, or national origin. (a) All time periods in this part that are stated in terms of (f) Data on disabilities shall also be collected by voluntary days are calendar days unless otherwise stated. self-identification. If an employee does not voluntarily (b) A document shall be deemed timely if it is received or provide the requested information, the Board shall postmarked before the expiration of the applicable advise the employee of the importance of the data and filing period, or, in the absence of a legible postmark, if of the Board's obligation to report it. If an employee it is received by mail within five days of the expiration who has been appointed pursuant to a special Board of the applicable filing period. program for hiring individuals with a disability still (c) The time limits in this part are subject to waiver, refuses to provide the requested information, the Board estoppel and equitable tolling. must identify the employee's disability based upon (d) The first day counted shall be the day after the event the records supporting the appointment. If any other from which the time period begins to run and the last employee still refuses to provide the requested infor- day of the period shall be included, unless it falls on a mation or provides information that the Board believes Saturday, Sunday or Federal holiday, in which case the to be inaccurate, the Board should report the employ- period shall be extended to include the next business ee's disability status as unknown. day. (g) The Board shall report to the Commission on employment by race, national origin, sex and disability in the Section 268.605—Representation and official time. form and at such times as the Board and Commission shall agree. (a) At any stage in the processing of a complaint, including the counseling stage under section 268.104, the Section 268.602—Reports to the Commission. complainant shall have the right to be accompanied, represented, and advised by a representative of com- (a) The Board shall report to the Commission information plainant's choice. concerning pre-complaint counseling and the status, (b) If the complainant is an employee of the Board, he or processing, and disposition of complaints under this she shall have a reasonable amount of official time, if Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

294 Federal Reserve Bulletin • June 2003 otherwise on duty, to prepare the complaint and to ing from an administrative judge on the consolidated comrespond to Board and EEOC requests for information. plaints any time after 180 days from the date of the first If the complainant is an employee of the Board and he filed complaint. Administrative judges or the Commission designates another employee of the Board as his or her may, in their discretion, consolidate two or more comrepresentative, the representative shall have a reason- plaints of discrimination filed by the same complainant. able amount of official time, if otherwise on duty, to prepare the complaint and respond to Board and EEOC Section 268.607—Delegation of authority. requests for information. The Board is not obligated to change work schedules, incur overtime wages, or pay The Board of Governors may delegate authority under this travel expenses to facilitate the choice of a specific part, to one or more designees. representative or to allow the complainant and representative to confer. The complainant and the representative, if employed by the Board and otherwise in a pay Subpart H—Prohibition Against Discrimination in status, shall be on official time, regardless of their tour Board Programs and Activities Because of Physical or of duty, when their presence is authorized or required Mental Disability by the Board or the Commission during the investigation, informal adjustment, or hearing on the complaint. Section 268.701—Purpose and application. (c) In cases where the representation of a complainant or the Board would conflict with the official or collateral (a) Purpose. The purpose of this subpart H is to prohibit duties of the representative, the Commission or the discrimination on the basis of a disability in programs Board may, after giving the representative an opportu- or activities conducted by the Board. nity to respond, disqualify the representative. (b) Application. (d) Unless the complainant states otherwise in writing, (1) This subpart H applies to all programs and activiafter the Board has received written notice of the ties conducted by the Board. Such programs and name, address and telephone number of a representa- activities include: tive for the complainant, all official correspondence (i) Holding open meetings of the Board or other shall be with the representative with copies to the meetings or public hearings at the Board's complainant. When the complainant designates an office in Washington, DC; attorney as representative, service of all official corre- (ii) Responding to inquiries, filing complaints, spondence shall be made on the attorney and the or applying for employment at the Board's complainant, but time frames for receipt of material office; shall be computed from the time of receipt by the (iii) Making available the Board's library faciliattorney. The complainant must serve all official corre- ties; and spondence on the designated representative of the (iv) Any other lawful interaction with the Board Board. or its staff in any official matter with people (e) The complainant shall at all times be responsible for who are not employees of the Board. proceeding with the complaint whether or not he or she (2) This subpart H does not apply to Federal Reserve has designated a representative. Banks or to financial institutions or other compa- (f) Witnesses who are Board employees shall be in a duty nies supervised or regulated by the Board. status when their presence is authorized or required by Commission or Board officials in connection with a Section 268.702—Definitions. complaint. For purposes of this subpart, the following definitions Section 268.606—Joint processing and consolidation apply: of complaints. (a) Auxiliary aids means services or devices that enable Complaints of discrimination filed by two or more com- persons with impaired sensory, manual, or speaking plainants consisting of substantially similar allegations of skills to have an equal opportunity to participate in, discrimination or relating to the same matter may be con- and enjoy the benefits of, programs or activities consolidated by the Board or the Commission for joint pro- ducted by the Board. For example, auxiliary aids usecessing after appropriate notification to the parties. Two or ful for persons with impaired vision include readers, more complaints of discrimination filed by the same com- Brailled materials, audio recordings, telecommunicaplainant shall be consolidated by the Board for joint pro- tions devices and other similar services and devices. cessing after appropriate notification to the complainant. Auxiliary aids useful for persons with impaired hear- When a complaint has been consolidated with one or more ing include telephone handset amplifiers, telephones earlier filed complaints, the Board shall complete its inves- compatible with hearing aids, telecommunication tigation within the earlier of 180 days after the filing of the devices for deaf persons (TDD's), interpreters, notelast complaint or 360 days after the filing of the original takers, written materials, and other similar services and complaint, except that the complainant may request a hear- devices. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 295 (b) Complete complaint means a written statement that (e) Qualified person with a disability means— contains the complainant's name and address and (1) With respect to any Board program or activity describes the Board's alleged discriminatory action in under which a person is required to perform sersufficient detail to inform the Board of the nature and vices or to achieve a level of accomplishment, a date of the alleged violation. It shall be signed by the person with a disability who meets the essential complainant or by someone authorized to do so on his eligibility requirements and who can achieve the or her behalf. Complaints filed on behalf of classes purpose of the program or activity without modifior third parties shall describe or identify (by name, if cations in the program or activity that the Board possible) the alleged victims of discrimination. can demonstrate would result in a fundamental (c) Facility means all or any portion of buildings, struc- alteration in its nature; or tures, equipment, roads, walks, parking lots, rolling (2) With respect to any other program or activity, a stock or other conveyances, or other real or personal person with a disability who meets the essential property. eligibility requirements for participation in, or (d) Person with a disability means any person who has receipt of benefits from, that program or activity. a physical or mental impairment that substantially (3) Qualified individual with a disability is defined for limits one or more major life activities, has a purposes of employment in section 268.203 of this record of such an impairment, or is regarded as hav- part, which is made applicable to this subpart by ing such an impairment. As used in this definition, the section 268.705. phrase: (1) Physical or mental impairment includes— Section 268.703—Notice. (i) Any physiological disorder or condition, cosmetic disfigurement, or anatomical loss affect- The Board shall make available to employees, applicants ing one of more of the following body sys- for employment, participants, beneficiaries, and other intertems: Neurological; musculoskeletal; special ested persons information regarding the provisions of this sense organs; respiratory, including speech subpart and its applicability to the programs and activities organs; cardiovascular; reproductive; diges- conducted by the Board, and make this information availtive; genitourinary; hemic and lymphatic; skin; able to them in such manner as the Board finds necessary and endocrine; or to apprise such persons of the protections against discrimi- (ii) Any mental or psychological disorder, such nation assured them by this subpart. as mental retardation, organic brain syndrome, emotional or mental illness, and specific learn- Section 268.704—General prohibitions against ing disabilities. The term physical or mental discrimination. impairment includes, but is not limited to, such diseases and conditions as orthopedic, (a) No qualified individual with a disability shall, on the visual, speech, and hearing impairments, cere- basis of a disability, be excluded from participation in, bral palsy, epilepsy, muscular dystrophy, mul- be denied the benefits of, or otherwise be subjected to tiple sclerosis, cancer, heart disease, diabetes, discrimination in any program or activity conducted by mental retardation, emotional illness, and drug the Board. addiction and alcoholism. (b) (1) The Board, in providing any aid, benefit, or ser- (2) Major life activities includes functions such as vice, may not, directly or through contractual, caring for one's self, performing manual tasks, licensing, or other arrangements, on the basis of a walking, seeing, hearing, speaking, breathing, disability: learning, and working. (i) Deny a qualified individual with a disability (3) Has a record of such an impairment means has a the opportunity to participate in or benefit history of, or has been misclassified as having, a from the aid, benefit, or service that is not mental or physical impairment that substantially equal to that provided to others; limits one or more major life activities. (ii) Afford a qualified individual with a disability (4) Is regarded as having an impairment means— an opportunity to participate in or benefit (i) Has a physical or mental impairment that from the aid, benefit, or service that is not does not substantially limit major life activi- equal to that afforded others; ties but is treated by the Board as constituting (iii) Provide a qualified individual with a disabilsuch a limitation; ity with an aid, benefit, or service that is not (ii) Has a physical or mental impairment that as effective in affording equal opportunity to substantially limits major life activities only obtain the same result, to gain the same beneas a result of the attitudes of others toward fit, or to reach the same level of achievement such impairment; or as that provided to others; (iii) Has none of the impairments defined in para- (iv) Provide different or separate aid, benefits, or graph (d)(1) of this section but is treated by services to individuals with a disability or to Board as having such an impairment. any class of individuals with a disability than Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

296 Federal Reserve Bulletin • June 2003 is provided to others unless such action is (d) The Board shall administer programs and activities in necessary to provide qualified individuals the most integrated setting appropriate to the needs of with a disability with aid, benefits, or services qualified individuals with a disability. that are as effective as those provided to others; Section 268.705—Employment. (v) Deny a qualified individual with a disability the opportunity to participate as a member of No qualified individual with a disability shall, on the basis planning or advisory boards; or of a disability, be subjected to discrimination in employ- (vi) Otherwise limit a qualified individual with a ment under any program or activity conducted by the disability in the enjoyment of any right, privi- Board. The definitions, requirements and procedures of lege, advantage, or opportunity enjoyed by section 268.203 of this part shall apply to discrimination in others receiving the aid, benefit, or service. employment in federally conducted programs or activities. (2) The Board may not deny a qualified individual with a disability the opportunity to participate in Section 268.706—Program accessibility: programs or activities that are not separate or Discrimination prohibited. different, despite the existence of permissibly separate or different programs or activities. Except as otherwise provided in section 268.707 of this (3) The Board may not, directly or through contractual subpart, no qualified individual with a disability shall, or other arrangements, utilize criteria or methods because the Board's facilities are inaccessible to or unusof administration, the purpose or effect of which able by individuals with a disability, be denied the benewould: fits of, be excluded from participation in, or otherwise be (i) Subject qualified individuals with a disability subjected to discrimination under any program or activity to discrimination on the basis of a disability; conducted by the Board. or (ii) Defeat or substantially impair accomplishment of the objectives of a program or activity Section 268.707—Program accessibility: Existing with respect to individuals with a disability. facilities. (4) The Board may not, in determining the site or location of a facility, make selections the purpose (a) General. The Board shall operate each program or or effect of which would: activity so that the program or activity, when viewed (i) Exclude individuals with a disability from, in its entirety, is readily accessible to and usable by deny them the benefits of, or otherwise subject individuals with a disability. This paragraph (a) does them to discrimination under any program or not: activity conducted by the Board; or (1) Necessarily require the Board to make each of its (ii) Defeat or substantially impair the accomplish- existing facilities accessible to and usable by indiment of the objectives or a program or activity viduals with a disability; or with respect to individuals with a disability. (2) Require the Board to take any action that it can (5) The Board, in the selection of procurement con- demonstrate would result in a fundamental altertractors, may not use criteria that subject qualified ation in the nature of a program or activity or individuals with a disability to discrimination on in undue financial and administrative burdens. In the basis of a disability. those circumstances where the Board believes that (6) The Board may not administer a licensing or certi- the proposed action would fundamentally alter the fication program in a manner that subjects quali- program or activity or would result in undue finanfied individuals with a disability to discrimination cial and administrative burdens, the Board has the on the basis of a disability, nor may the Board burden of proving that compliance with this paraestablish requirements for the programs and activi- graph (a) would result in such alterations or burties of licensees or certified entities that subject dens. The decision that compliance would result qualified individuals with a disability to discrimi- in such alterations or burdens shall be made by the nation on the basis of a disability. However, the Board of Governors or their designee after considprograms and activities of entities that are licensed ering all Board resources available for use in the or certified by the Board are not, themselves, cov- funding and operation of the conducted program ered by this subpart. or activity, and must be accompanied by a written (c) The exclusion of individuals who do not have a disabil- statement of the reasons for reaching that concluity from the benefits of a program limited by Federal sion. If an action would result in such an alteration statute or Board order to individuals with a disability or such burdens, the Board shall take any other or the exclusion of a specific class of individuals with a action that would not result in such an alteration or disability from a program limited by Federal statute or such burdens but would nevertheless ensure that Board order to a different class of individuals with a individuals with a disability receive the benefits disability is not prohibited by this subpart. and services of the program or activity. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 297 (b) Methods. The Board may comply with the require- a location at which they can obtain information about ments of this subpart H through such means as rede- accessible facilities. The international symbol for sign of equipment, reassignment of services to acces- accessibility shall be used at each primary entrance of sible buildings, assignment of aides to individuals with an accessible facility. a disability, home visits, delivery of service at alternate (d) This section does not require the Board to take any accessible sites, alteration of existing facilities and action that would result in a fundamental alteration in construction of new facilities, use of accessible rolling the nature of a program or activity or in undue finanstock, or any other methods that result in making its cial and administrative burdens. In those circumstances programs or activities readily accessible to and usable where the Board believes that the proposed action by individuals with a disability. The Board is not would fundamentally alter the program or activity or required to make structural changes in existing facili- would result in undue financial and administrative ties where other methods are effective in achieving burdens, the Board has the burden of proving that compliance with this section. In choosing among avail- compliance with section 268.709 would result in such able methods for meeting the requirements of this alterations or burdens. The determination that complisection, the Board shall give priority to those methods ance would result in such alteration or burdens must be that offer programs and activities to qualified individu- made by the Board of Governors or their designee after als with a disability in the most integrated setting considering all Board resources available for use in the appropriate. funding and operation of the conducted program or (c) Time period for compliance. The Board shall comply activity, and must be accompanied by a written statewith any obligations established under this section as ment of the reasons for reaching that conclusion. If expeditiously as possible. an action required to comply with this section would result in such an alteration or such burdens, the Board shall take any other action that would not result in such Section 268.708—Program accessibility: New an alteration or such burdens but would nevertheless construction and alterations. ensure that, to the maximum extent possible, individuals with a disability receive the benefits and services of Each building or part of a building that is constructed or the program or activity. altered by, on behalf of, or for the use of the Board shall be designed, constructed, or altered so as to be readily acces- Section 268.710—Compliance procedures. sible to and usable by individuals with a disability. (a) Applicability. Except as provided in paragraph (b) of Section 268.709—Communications. this section, this section, rather than subpart B and section 268.203 of this part, applies to all allegations (a) The Board shall take appropriate steps to ensure effec- of discrimination on the basis of a disability in protive communication with applicants, participants, per- grams or activities conducted by the Board. sonnel of other Federal entities, and members of the (b) Employment complaints. The Board shall process compublic. plaints alleging discrimination in employment on the (1) The Board shall furnish appropriate auxiliary aids basis of a disability in accordance with subparts A where necessary to afford an individual with a through G of this part. disability an equal opportunity to participate in, (c) Responsible official. The EEO Programs Director shall and enjoy the benefits of, a program or activity be responsible for coordinating implementation of this conducted by the Board. section. (i) In determining what type of auxiliary aid is (d) Filing the complaint— necessary, the Board shall give primary con- (1) Who may file. Any person who believes that he or sideration to the requests of the individual she has been subjected to discrimination prohibwith a disability. ited by this subpart may, personally or by his or (ii) The Board need not provide individually pre- her authorized representative, file a complaint of scribed devices, readers for personal use or discrimination with the EEO Programs Director. study, or other devices of a personal nature. (2) Confidentiality. The EEO Programs Director shall (2) Where the Board communicates with employees not reveal the identity of any person submitting a and others by telephone, telecommunication complaint, except when authorized to do so in devices for deaf persons (TDD's) or equally effec- writing by the complainant, and except to the tive telecommunication systems shall be used. extent necessary to carry out the purposes of this (b) The Board shall ensure that interested persons, includ- subpart , including the conduct of any investigaing persons with impaired vision or hearing, can obtain tion, hearing, or proceeding under this subpart. information as to the existence and location of acces- (3) When to file. Complaints shall be filed within sible services, activities, and facilities. 180 days of the alleged act of discrimination. The (c) The Board shall provide signage at a primary entrance EEO Programs Director may extend this time limit to each of its inaccessible facilities, directing users to for good cause shown. For the purpose of deter- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

298 Federal Reserve Bulletin • June 2003 mining when a complaint is timely filed under this (4) If a complaint is resolved informally, the terms of paragraph (d), a complaint mailed to the Board the agreement shall be reduced to writing and shall be deemed filed on the date it is postmarked. made a part of the complaint file, with a copy of Any other complaint shall be deemed filed on the the agreement provided to the complainant. The date it is received by the Board. written agreement may include a finding on the (4) How to file. Complaints may be delivered or issue of discrimination and shall describe any cormailed to the Administrative Governor, the Staff rective action to which the complainant has agreed. Director for Management, the EEO Programs (g) Letter of findings. Director, the Federal Women's Program Manager, (1) If an informal resolution of the complaint is not the Hispanic Employment Program Coordinator, reached, the EEO Programs Director shall transmit or the People with Disabilities Program Coordina- the complaint file to the Staff Director for Managetor. Complaints should be sent to the EEO Pro- ment. The Staff Director for Management shall, grams Director, Board of Governors of the Federal within 180 days of the receipt of the complete Reserve System, 20th and C Street, NW, Washing- complaint by the EEO Programs Director, notify ton, DC 20551. If any Board official other than the the complainant of the results of the investigation EEO Programs Director receives a complaint, he in a letter sent by certified mail, return receipt or she shall forward the complaint to the EEO requested, containing: Programs Director. (i) Findings of fact and conclusions of law; (e) Acceptance of complaint. (i) A description of a remedy for each violation (1) The EEO Programs Director shall accept a com- found; plete complaint that is filed in accordance with (iii) A notice of right of the complainant to appeal paragraph (d) of this section and over which the the letter of findings under paragraph (k) of Board has jurisdiction. The EEO Programs Direc- this section; and tor shall notify the complainant of receipt and (iv) A notice of right of the complainant to request acceptance of the complaint. a hearing. (2) If the EEO Programs Director receives a complaint (2) If the complainant does not file a notice of appeal that is not complete, he or she shall notify the or does not request a hearing within the times complainant, within 30 days of receipt of the prescribed in paragraph (h)(1) and (j)(l) of this incomplete complaint, that additional information section, the EEO Programs Director shall certify is needed. If the complainant fails to complete the that the letter of findings under this paragraph (g) complaint within 30 days of receipt of this notice, is the final decision of the Board at the expiration the EEO Programs Director shall dismiss the com- of those times. plaint without prejudice. (h) Filing an appeal. (3) If the EEO Programs Director receives a complaint (1) Notice of appeal, with or without a request for over which the Board does not have jurisdiction, hearing, shall be filed by the complainant with the the EEO Programs Director shall notify the EEO Programs Director within 30 days of receipt complainant and shall make reasonable efforts to from the Staff Director for Management of the refer the complaint to the appropriate government letter of findings required by paragraph (g) of this entity. section. (f) Investigation/conciliation. (2) If the complainant does not request a hearing, the (1) Within 180 days of the receipt of a complete EEO Programs Director shall notify the Board of complaint, the EEO Programs Director shall com- Governors of the appeal by the complainant and plete the investigation of the complaint, attempt that a decision must be made under paragraph (k) informal resolution of the complaint, and if no of this section. informal resolution is achieved, the EEO Programs (i) Acceptance of appeal. The EEO Programs Director Director shall forward the investigative report to shall accept and process any timely appeal. A comthe Staff Director for Management. plainant may appeal to the Administrative Governor (2) The EEO Programs Director may request Board from a decision by the EEO Programs Director that an employees to cooperate in the investigation and appeal is untimely. This appeal shall be filed within attempted resolution of complaints. Employees 15 calendar days of receipt of the decision from the who are requested by the EEO Programs Director EEO Programs Director. to participate in any investigation under this sec- (j) Hearing. tion shall do so as part of their official duties and (1) Notice of a request for a hearing, with or without a during the course of regular duty hours. request for an appeal, shall be filed by the com- (3) The EEO Programs Director shall furnish the com- plainant with the EEO Programs Director within plainant with a copy of the investigative report 30 days of receipt from the Staff Director for promptly after completion of the investigation and Management of the letter of findings required by provide the complainant with an opportunity for paragraph (g) of this section. Upon a timely informal resolution of the complaint. request for a hearing, the EEO Programs Director Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 299 shall request that the Board of Governors, or its and shall be on official duty status for this designee, appoint an administrative law judge to purpose. They shall not receive witness fees. conduct the hearing. The administrative law judge (ii) Employees of other Federal agencies called shall issue a notice to the complainant and the to testify at a hearing, at the request of Board specifying the date, time, and place of the the administrative law judge and with the scheduled hearing. The hearing shall be com- approval of the employing agency, shall be on menced no earlier than 15 calendar days after the official duty status during any absence from notice is issued and no later than 60 days after the normal duties caused by their testimony, and request for a hearing is filed, unless all parties shall not receive witness fees. agree to a different date. (iii) The fees and expenses of other persons called (2) The hearing, decision, and any administrative to testify at a hearing shall be paid by the review thereof shall be conducted in conformity party requesting their appearance. with 5 U.S.C. 554-557. The administrative law (iv) The administrative law judge may require the judge shall have the duty to conduct a fair hearing, Board to pay travel expenses necessary for to take all necessary actions to avoid delay, and to the complainant to attend the hearing. maintain order. He or she shall have all powers (v) The Board shall pay the required expenses necessary to these ends, including (but not limited and charges for the administrative law judge to) the power to: and court reporter. (i) Arrange and change the dates, times, and (vi) All other expenses shall be paid by the parties places of hearings and prehearing confer- incurring them. ences and to issue notice thereof; (5) The administrative law judge shall submit in writ- (ii) Hold conferences to settle, simplify, or deter- ing recommended findings of fact, conclusions of mine the issues in a hearing, or to consider law, and remedies to the complainant and the EEO other matters that may aid in the expeditious Programs Director within 30 days, after the receipt disposition of the hearing; of the hearing transcripts, or within 30 days after (iii) Require parties to state their positions in the conclusion of the hearing if no transcripts are writing with respect to the various issues in made. This time limit may be extended with the the hearing and to exchange such statements permission of the EEO Programs Director. with all other parties; (6) Within 15 calendar days after receipt of the recom- (iv) Examine witnesses and direct witnesses to mended decision of the administrative law judge, testify; the complainant may file exceptions to the recom- (v) Receive, rule on, exclude, or limit evidence; mended decision with the EEO Programs Director. (vi) Rule on procedural items pending before him On behalf of the Board, the EEO Programs Direcor her; and tor may, within 15 calendar days after receipt of (vii) Take any action permitted to the administra- the recommended decision of the administrative tive law judge as authorized by this sub- law judge, take exception to the recommended part G or by the provisions of the Adminis- decision of the administrative law judge and shall trative Procedures Act (5 U.S.C. 554-557). notify the complainant in writing of the Board's (3) Technical rules of evidence shall not apply to exception. Thereafter, the complainant shall have hearings conducted pursuant to this paragraph (j), 10 calendar days to file reply exceptions with but rules or principles designed to assure produc- the EEO Programs Director. The EEO Programs tion of credible evidence and to subject testimony Director shall retain copies of the exceptions and to cross- examination shall be applied by the replies to the Board's exception for consideration administrative law judge wherever reasonably nec- by the Board. After the expiration of the time to essary. The administrative law judge may exclude reply, the recommended decision shall be ripe for a irrelevant, immaterial, or unduly repetitious evi- decision under paragraph (k) of this section. dence. All documents and other evidence offered (k) Decision. or taken for the record shall be open to examina- (1) The EEO Programs Director shall notify the Board tion by the parties, and opportunity shall be given of Governors when a complaint is ripe for decision to refute facts and arguments advanced on either under this paragraph (k). At the request of any side of the issues. A transcript shall be made of the member of the Board of Governors made within oral evidence except to the extent the substance 3 business days of such notice, the Board of Govthereof is stipulated for the record. All decisions ernors shall make the decision on the complaint. If shall be based upon the hearing record. no such request is made, the Administrative Gov- (4) The costs and expenses for the conduct of a hear- ernor, or the Staff Director for Management if he ing shall be allocated as follows: or she is delegated the authority to do so, shall (i) Employees of the Board shall, upon the make the decision on the complaint. The decision request of the administrative law judge, be shall be made based on information in the invesmade available to participate in the hearing tigative record and, if a hearing is held, on the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

300 Federal Reserve Bulletin • June 2003 hearing record. The decision shall be made within Bank, National Association, Reno, Nevada ("Bank"), a 60 days of the receipt by the EEO Programs Direc- de novo bank.1 tor of the notice of appeal and investigative record Notice of the proposal, affording interested persons pursuant to paragraph (h)(1) of this section or an opportunity to submit comments, has been published 60 days following the end of the period for filing (68 Federal Register 7792 (2003)). The time for filing reply exceptions set forth in paragraph (j)(6) of comments has expired, and the Board has considered the this section, whichever is applicable. If the proposal in light of the factors set forth in section 3 of the decision-maker under this paragraph (k) deter- BHC Act. mines that additional information is needed from Schwab, with total consolidated assets of $40 billion, is any party, the decision-maker shall request the the 28th largest commercial banking organization in the information and provide the other party or parties United States.2 Schwab controls $4.2 billion in deposits in an opportunity to respond to that information. The depository institutions nationwide, representing less than decision-maker shall have 60 days from receipt of 1 percent of the total deposits in insured depository instithe additional information to render the decision tutions in the United States.3 U.S. Trust Corporation, on the appeal. The decision-maker shall transmit New York, New York ("US. Trust"), a wholly owned the decision by letter to all parties. The decision subsidiary of Schwab, operates depository institutions in shall set forth the findings, any remedial actions California, Connecticut, Florida, New York, North Carorequired, and the reasons for the decision. If the lina, and Texas, as well as a nondepository trust company decision is based on a hearing record, the decision- in Delaware. maker shall consider the recommended decision of the administrative law judge and render a final Interstate Analysis decision based on the entire record. The decisionmaker may also remand the hearing record to the Section 3(d) of the BHC Act allows the Board to approve administrative law judge for a fuller development an application by a bank holding company to acquire of the record. control of a bank located in a state other than the home (2) The Board shall take any action required under the state of such bank holding company if certain conditions terms of the decision promptly. The decision- are met.4 For purposes of the BHC Act, the home state of maker may require periodic compliance reports Schwab is New York, and Schwab would acquire a bank in specifying: Nevada. All the conditions for an interstate acquisition enumerated in section 3(d) are met in this case.5 In light of (i) The manner in which compliance with the all the facts of record, the Board is permitted to approve provisions of the decision has been achieved; the proposal under section 3(d) of the BHC Act. (ii) The reasons any action required by the final Board decision has not been taken; and (iii) The steps being taken to ensure full Competitive Considerations compliance. Section 3 of the BHC Act prohibits the Board from approv- (3) The decision-maker may retain responsibility for ing a proposal that would result in a monopoly or would be resolving disputes that arise between parties over interpretation of the final Board decision, or for 1. Schwab has received the following regulatory approvals to estabspecific adjudicatory decisions arising out of lish Bank: implementation. (1) Office of the Comptroller of the Currency ("OCC") (February 4, 2003) (preliminary); (2) Federal Deposit Insurance Corporation ("FDIC") (February 10, 2003); and ORDERS ISSUED UNDER BANK HOLDING (3) State of Nevada Financial Institutions Division (March 13, 2003). COMPANY ACT 2. Asset and nationwide ranking data for Schwab are as of December 31, 2002. Orders Issued Under Section 3 of the Bank 3. Deposit data are as of June 30, 2002. In this context, depository Holding Company Act institutions include commercial banks, savings banks, and savings associations. 4. See 12 U.S.C.§ 1842(d). A bank holding company's home state Charles Schwab Corporation is the state in which the total deposits of all banking subsidiaries of San Francisco, California such company were the largest on July 1, 1966, or the date on which the company became a bank holding company, whichever is later. 12 U.S.C. § 1841(o)(4)(C). Order Approving Acquisition of a Bank 5. 12 U.S.C. §§ 1842(d)(1)(A) and (B) and 1842(d)(2)(A) and (B). Schwab meets the capital and managerial requirements established The Charles Schwab Corporation ("Schwab", a financial under applicable law. The formation and acquisition of Bank is not holding company within the meaning of the Bank Holding subject to a minimum age requirement under Nevada law. See Nev. Rev. Stat. 666.405. On consummation, Schwab would control less Company Act ("BHC Act"), has requested the Board's than 10 percent of the total amount of deposits of insured depository approval under section 3 of the BHC Act (12 U.S.C. institutions in the United States. All other requirements of section 3(d) § 1842) to acquire all the voting shares of Charles Schwab of the BHC Act would be met on consummation of the proposal. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 301 in furtherance of any attempt to monopolize the business of the convenience and needs of the communities to be served banking. The BHC Act also prohibits the Board from and take into account the records of the relevant depository approving an acquisition that would substantially lessen institutions under the Community Reinvestment Act competition in any relevant banking market, unless the (12 U.S.C. §2901 et seq.) ("CRA"). The Board has care- Board finds that the anticompetitive effects are clearly fully considered the convenience and needs factor and the outweighed in the public interest by the probable effect of CRA performance records of Schwab's subsidiary insured the proposal in meeting the convenience and needs of the depository institutions in light of all the facts of record, community to be served.6 including public comments received on the proposal. The proposal involves the formation and acquisition of a As provided in the CRA, the Board has evaluated the de novo bank in the Reno, Nevada, banking market ("Reno convenience and needs factor in light of examinations of banking market"), a market in which Schwab does not the CRA performance records of Schwab's subsidiary have banking operations, and thereby would increase the insured depository institutions by the appropriate federal number of alternative sources of banking products and financial supervisory agencies.9 United States Trust Comservices available to customers in that market.7 The Board pany of New York, New York, the lead insured depository previously has noted that the establishment of a de novo institution of Schwab, received an "outstanding" rating at bank enhances competition in the relevant banking market its most recent CRA performance examination by the Fedand is a positive consideration in an application under eral Reserve Bank of New York, as of April 3, 2000. The section 3 of the BHC Act. There is no evidence that the other subsidiary insured depository institutions of Schwab proposal would create or further a monopoly or lessen and U.S. Trust received "outstanding" or "satisfactory" competition in any relevant market. Accordingly, the Board ratings at their most recent performance examinations.10 concludes that consummation of the proposal would not The Board received comments from two community result in any significantly adverse effects on competition or organizations that opposed the proposal or requested on the concentration of banking resources in any relevant that the Board's order impose certain conditions on an banking market, and that competitive considerations are approval. The commenters asserted that Bank's proposed consistent with approval. CRA plan was inadequate and questioned whether Bank would adequately meet the needs of low- and moderate- Financial, Managerial, and Supervisory Considerations income ("LMI") individuals and communities.11 As previously noted, Bank is in formation and has not commenced Section 3 of the BHC Act requires the Board to consider operations. Schwab was required to submit a CRA plan in the financial and managerial resources and future prospects connection with its charter application to the OCC, Bank's of the companies and banks involved in a proposal and appropriate federal financial supervisory agency, and the certain other supervisory factors. The Board has reviewed OCC took the CRA plan into account in granting prelimithese factors in light of all the facts of record, includ- nary charter approval for Bank.12 The OCC will evaluate ing supervisory reports of examination, other confidential supervisory information assessing the financial and mana- 9. The Interagency Questions and Answers Regarding Community gerial resources of Schwab and the proposed management Reinvestment provides that an institution's most recent CRA perforof Bank, and information provided by Schwab. The Board mance evaluation is an important and often controlling factor in the notes that Schwab and its subsidiary depository institutions consideration of an institution's CRA record because it represents a currently are well capitalized and are expected to remain detailed evaluation of the institution's overall record of performance so after consummation of the proposal. Bank also would be under the CRA by its appropriate federal supervisory agency. 66 Federal Register 36,620 and 36,639 (2001). well capitalized at consummation. Based on all the facts of 10. U.S. Trust Company, N.A., Los Angeles, California, received record, the Board concludes that the financial and manage- an "outstanding " rating from the OCC, as of October 15, 2002. In rial resources and the future prospects of Schwab, Bank, addition, the following institutions received "satisfactory" ratings and Schwab's other subsidiary insured depository institu- from the federal financial supervisory agencies indicated, as of the dates listed: U.S. Trust Company, Greenwich, Connecticut (FDIC; tions are consistent with approval, as are the other super- February 8, 2001); U.S. Trust Company of Florida Savings Bank, visory factors the Board must consider under section 3 of Palm Beach, Florida (Office of Thrift Supervision; November 12, the BHC Act.8 1997); U.S. Trust Company of North Carolina, Greensboro, North Carolina (FDIC; July 22, 2002); and U.S. Trust Company of Texas, N.A., Dallas, Texas (OCC; June 25, 1997). Convenience and Needs Factor 11. One commenter expressed concern that Bank would not engage in small business lending. Although the Board has recognized that In acting on a proposal under section 3 of the BHC Act, the banks assist in meeting the banking needs of communities by making Board is required to consider the effect of the proposal on a variety of products and services available, the CRA does not require an institution to provide any specific types of products and services, such as small business loans, in its assessment area. 6. 12 U.S.C. § 1842(c)(1). 12. Schwab has designated Bank's CRA assessment area as the 7. The Reno banking market is defined as the Reno Ranally Metro- Reno, Nevada, Metropolitan Statistical Area "Reno, Nevada "), which politan Area and the town of Fermley, all in Nevada. consists of Washoe County, Nevada. One commenter questioned the 8. After consulting with the OCC and reviewing all the facts of appropriateness of this assessment area. In its decision granting prerecord, the Board also has determined that, on consummation of the liminary charter approval, the OCC determined that Bank's designaproposal, Bank would be well managed for purposes of section 4(1) of tion of the Reno MSA as the assessment area was appropriate under the BHC Act (12 U.S.C. § 1843(/)). the agency's CRA regulations. See Decision of the OCC on the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

302 Federal Reserve Bulletin • June 2003 the adequacy and implementation of Bank's CRA plan in Conclusion each CRA performance examination of Bank. The CRA requires that, in considering an acquisition Based on the foregoing, and in light of all the facts of proposal, the Board carefully review the actual perfor- record, the Board has determined that the application mance records of the relevant depository institutions in should be, and hereby is, approved. The Board's approval helping meet the credit needs of their communities.13 As is specifically conditioned on compliance by Schwab with noted above, Schwab has achieved and maintained strong all the commitments and representations made in connec- CRA ratings at its insured depository institution subsidi- tion with the application. For purposes of this action, aries and, therefore, has demonstrated the capability and the commitments and conditions relied on by the Board in willingness to implement the CRA plan for Bank that has reaching its decision are deemed to be conditions imposed been reviewed by the OCC. in writing in connection with its findings and decision and, In assessing the convenience and needs factor in this as such, may be enforced in proceedings under applicable case, the Board has carefully considered all the facts of law. record, including review of the CRA performance exami- The transaction shall not be consummated before the nations of Schwab's insured depository institution sub- fifteenth calendar day after the effective date of this order sidiaries, information provided by Schwab, and public or later than three months after the effective date of this comments on the proposal.14 In addition, the Board has order, and Bank shall be open for business within six consulted with the OCC, the primary federal financial months after the effective date of this order, unless such supervisory agency of Bank. Based on all the facts of periods are extended for good cause by the Board or by the record, the Board concludes that considerations relating Federal Reserve Bank of San Francisco, acting pursuant to to the convenience and needs factor are consistent with delegated authority. approval of the proposal.15 By order of the Board of Governors, effective April 7, 2003. Application to Charter Charles Schwab Bank, National Association, Voting for this action: Chairman Greenspan, Vice Chairman Fergu- Reno, Nevada, dated February 4, 2003; see also 12 C.F.R. 25.41(c)(2). son, and Governors Gramlich, Bies, Olson, and Bernanke. Absent and 13. One commenter expressed concern that Bank's business focus not voting: Governor Kohn. would be on serving Schwab's existing customers and urged Bank to commit to specific goals or actions for providing products and ser- ROBERT DEV. FRIERSON vices to LMI communities. In addition, a commenter urged Schwab to commit that Bank would seek "high satisfactory" ratings on the CRA Deputy Secretary of the Board lending, investment, and service tests by 2004, and an overall CRA rating of "outstanding" by 2006. Neither the CRA nor the federal banking agencies' regulations require depository institutions to make pledges concerning future performance under the CRA. ORDERS ISSUED UNDER INTERNATIONAL 14. One commenter sought assurances that Schwab and its subsidi- BANKING ACT aries would not securitize "predatory" mortgage loans. Schwab stated that it does not originate, purchase, or securitize subprime mortgage Union Bank of Israel Ltd. loans for itself or other lenders. U.S. Trust, which offers mortgage loans to its high-net-worth private banking customers, has previously Tel Aviv, Israel securitized one pool of mortgage loans, and it has no current plans to securitize additional mortgages. Schwab stated that Bank would adopt Order Approving Establishment of a Representative policies and procedures designed to ensure that no high-cost loans Office would be offered to customers of Bank, and that the mortgage loans originated by or on behalf of Bank would not contain fees or terms that could be characterized as predatory or abusive. Union Bank of Israel Ltd. ("Bank"), Tel Aviv, Israel, a 15. One commenter requested that the Board hold a public meeting foreign bank within the meaning of the International Bankor hearing on the proposal. Section 3(b) of the BHC Act does not ing Act ("IBA"), has applied under section 10(a) of the require the Board to hold a public hearing on an application unless the IBA (12 U.S.C. § 3107(a)) to establish a representative appropriate supervisory authority for the bank to be acquired makes a office in New York, New York. The Foreign Bank Supervitimely written recommendation of denial of the application. The Board has not received such a recommendation from the appropriate sion Enhancement Act of 1991, which amended the IBA, supervisory authority. Under its rules, the Board also may, in its provides that a foreign bank must obtain the approval of discretion, hold a public meeting or hearing on an application to the Board to establish a representative office in the United acquire a bank if a meeting or hearing is necessary or appropriate to States. clarify factual issues related to the application and to provide an opportunity for testimony. 12 C.F.R. 225.16(e). The Board has con- Notice of the application, affording interested persons an sidered carefully the commenter's request in light of all the facts of opportunity to submit comments, has been published in a record. In the Board's view, the public has had ample opportunity to newspaper of general circulation in New York, New York submit its views, and, in fact, the commenter has submitted written (The New York Post, August 2, 2002). The time for filing comments that have been considered carefully by the Board in acting on the proposal. The commenter's request fails to demonstrate why its comments has expired, and all comments have been written comments do not present its evidence adequately and fails to considered. identify disputed issues of fact that are material to the Board's decision and would be clarified by a public meeting or hearing. For these reasons, and based on all the facts of record, the Board has warranted in this case. Accordingly, the request for a public meeting determined that a public meeting or hearing is not required or or hearing on the proposal is denied. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 303 Bank, with total consolidated assets of approximately With respect to supervision by home country authorities, $4.6 billion,1 is primarily engaged in capital market activi- the Board previously has determined, in connection with ties, foreign currency services, and financing the diamond an application involving another Israeli bank, that such industry.2 Bank operates branches throughout Israel and bank was subject to home country supervision on a consolione branch in the Cayman Islands. Bank also has several dated basis.4 Bank is supervised by the Bank of Israel on subsidiaries that engage in investment banking, portfolio substantially the same terms and conditions as the other and fund management, insurance, and mortgage lending. bank. Based on all the facts of record, it has been deter- The proposed representative office is intended to pro- mined that Bank is subject to comprehensive supervision mote Bank's services to existing and potential customers and regulation on a consolidated basis by its home country in the United States. It would conduct research, act as a supervisor. liaison with customers of Bank, solicit loans, execute loan The additional standards set forth in section 7 of the documents, and solicit purchasers of loans and loan servic- IBA and Regulation K (see 12 U.S.C. §3105(d)(3)-(4); ing contracts. All decisions on credit extended by Bank 12 C.F.R. 211.24(c)(2)) have also been taken into account. would be made at the head office. The Bank of Israel has no objection to the establishment of In acting on an application to establish a representative the proposed representative office. office, the IBA and Regulation K provide that the Board With respect to the financial and managerial resources of shall take into account whether the foreign bank engages Bank, taking into consideration Bank's record of operadirectly in the business of banking outside of the United tions in its home country, its overall financial resources, States and has furnished to the Board the information it and its standing with its home country supervisor, financial needs to assess the application adequately. The Board also and managerial factors are consistent with approval of the shall take into account whether the foreign bank and any proposed representative office. Bank appears to have the foreign bank parent is subject to comprehensive super- experience and capacity to support the proposed represenvision or regulation on a consolidated basis by its home tative office and has established controls and procedures country supervisor (12 U.S.C. § 3107(a)(2)).3 In the case of for the proposed representative office to ensure compliance an application to establish a representative office, the stan- with U.S. law. dard with respect to home country supervision would be Money laundering is a criminal offense in Israel and met if the applicant bank is subject to a supervisory framebanks are required to establish internal policies and prowork that is consistent with the activities of the proposed cedures for the detection and prevention of money launoffice, taking into account the nature of the activities dering. Israeli legislation and regulations of the Bank of and the operating record of the applicant. (12 C.F.R. Israel require banks to adopt know-your-customer policies, 211.24(d)(2)). The Board may take into account additional report suspicious transactions, appoint a compliance offistandards set forth in the IBA and Regulation K (12 U.S.C. cer, and maintain records. Accordingly, Bank has estab- § 3105(d)(3)—(4); 12 C.F.R. 211.24(c)(2)). lished anti-money laundering policies and procedures that As noted above, Bank engages directly in the business of have been adopted by all of Bank's offices and subsidibanking outside the United States. Bank also has provided aries. Bank has implemented know-your-customer polithe Board with information necessary to assess the applica- cies, suspicious activity reporting procedures, and related tion through submissions that address the relevant issues. training programs. With respect to access to information on Bank's operations, the restrictions on disclosure in relevant jurisdictions 1. Unless otherwise indicated, data are as of December 31, 2002. in which Bank operates have been reviewed and relevant 2. Shlomo Eliahu Holdings Ltd., Yeshayahu Landau Holdings government authorities have been communicated with re- (1993) Ltd., and David Lubinsky Assets (Holdings) 1993 Ltd. own garding access to information. Bank and its parents have 23, 23, and 18 percent of Bank, respectively. Bank Leumi le-Israel B.M., also in Tel Aviv, owns approximately 11.5 percent of Bank. The committed to make available to the Board such informaremaining shares of Bank are widely held. tion on the operations of Bank and any of its affiliates as 3. In assessing this standard, the Board considers, among other the Board deems necessary to determine and enforce comfactors, the extent to which the home country supervisors: pliance with the IBA, the Bank Holding Company Act of (i) Ensure that the bank has adequate procedures for monitoring and 1956, as amended, and other applicable federal law. To the controlling its activities worldwide; extent that the provision of such information to the Board (ii) Obtain information on the condition of the bank and its subsidiaries and offices through regular examination reports, audit may be prohibited by law or otherwise, Bank and Bank's reports, or otherwise; parents have committed to cooperate with the Board to (iii) Obtain information on the dealings with and relationship between obtain any necessary consents or waivers that might be the bank and its affiliates, both foreign and domestic; required from third parties for disclosure of such informa- (iv) Receive from the bank financial reports that are consolidated on a tion. In addition, subject to certain conditions, the Bank of worldwide basis or comparable information that permits analysis of the bank's financial condition on a worldwide consolidated Israel may share information on Bank's operations with basis; other supervisors, including the Board. In light of these (v) Evaluate prudential standards, such as capital adequacy and commitments and other facts of record, and subject to the risk asset exposure, on a worldwide basis. These are indicia of comprehensive, consolidated supervision. No single factor is essential, and other elements may inform the Board's 4. See Bank Hapoalim, B.M., 87 Federal Reserve Bulletin 327 determination. (2001). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

304 Federal Reserve Bulletin • June 2003 condition described below, it has been determined that of this application also is specifically conditioned on com- Bank has provided adequate assurances of access to any pliance by Bank and its parents with the commitments necessary information that the Board may request. made in connection with this application and with the On the basis of all the facts of record, and subject to the conditions in this order.6 The commitments and conditions commitments made by Bank and its parents and the terms referred to above are conditions imposed in writing by the and conditions set forth in this order, Bank's application Board in connection with its decision and may be enforced to establish the representative office is hereby approved.5 in proceedings against Bank and its affiliates under Should any restrictions on access to information on the 12 U.S.C. §1818. operations or activities of Bank or any of its affiliates By order, approved pursuant to authority delegated by subsequently interfere with the Board's ability to obtain the Board, effective April 10, 2003. information to determine and enforce compliance by Bank or its affiliates with applicable federal statutes, the Board ROBERT DEV. FRIERSON may require or recommend termination of any of Bank's Deputy Secretary of the Board direct and indirect activities in the United States. Approval 6. The Board's authority to approve the establishment of the proposed representative office parallels the continuing authority of the State of New York to license offices of a foreign bank. The Board's 5. Approved by the Director of the Division of Banking Super- approval of this application does not supplant the authority of the vision and Regulation, with the concurrence of the General Coun- State of New York or its agent, the New York State Banking Departsel, pursuant to authority delegated by the Board. See 12 C.F.R. ment, to license the proposed office of Bank in accordance with any 265.7(d)(12). terms or conditions that it may impose. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 305 APPLICATIONS APPROVED UNDER BANK HOLDING COMPANY ACT By Federal Reserve Banks Recent applications have been approved by the Federal Reserve Banks as listed below. Copies are available upon request to the Reserve Banks. Section 3 Applicant(s) Bank(s) Reserve Bank Effective Date Arvest Bank Group, Inc., Mountain Bancshares, Inc., St. Louis Aprill 9, 2003 Bentonville, Arkansas Yellville, Arkansas Arvest Holdings, Inc., The Bank of Yellville, Little Rock, Arkansas Yellville, Arkansas Bancorp V, Inc., Bank of Leeton, Kansas City April 15, 2003 Olathe, Kansas Leeton, Missouri Bank Capital Corporation, The Biltmore Bank of Arizona, Kansas City April 23, 2003 Phoenix, Arizona Phoenix, Arizona Bethlehem Financial Corporation, Bank of Belen, Kansas City April 3, 2003 Belen, New Mexico Belen, New Mexico BSA Bankshares, Inc., Bevans State Bank, Dallas April 24, 2003 Abilene, Texas Menard, Texas BSA Delaware, Inc., Dover, Delaware Central Financial Corporation, Mid-America Bancorp, Inc., Kansas City April 24, 2003 Hutchinson, Kansas Jewell, Kansas Heartland Bank, Jewell, Kansas Community Bancshares of First Lucedale Bancorp, Inc., Atlanta April 19, 2003 Mississippi, Inc., Lucedale, Mississippi Brandon, Mississippi First National Bank of Lucedale, Lucedale, Mississippi CBS Banc Corp, Inc., Community Financial Services, Inc., Atlanta April 2, 2003 Russellville, Alabama Bolivar, Tennessee Bank of Bolivar, Bolivar, Tennessee Financial Investors of the South, Inc., Consumer National Bank, Atlanta April 25, 2003 Birmingham, Alabama Jackson, Mississippi First American Bancshares, Inc., First American National Bank, St. Louis April 24, 2003 Iuka, Mississippi Iuka, Mississippi Guaranty Corporation, Bank Capital Corporation, Kansas City April 23, 2003 Denver, Colorado Phoenix, Arizona International Brotherhood of Brotherhood Bancshares, Inc., Kansas City March 28, 2003 Boilermakers, Iron Ship Builders, Kansas City, Kansas Blacksmiths, Forgers & Helpers, The Brotherhood Bank & Trust Kansas City, Kansas Company, Kansas City, Kansas Iroquois Bancorp, Inc., JW Bancorp, Inc., Chicago March 27, 2003 Gilman, Illinois Winchester, Illinois John Warner Financial Corporation, Clinton, Illinois The John Warner Bank, Clinton, Illinois JW Bancorp, Inc., John Warner Financial Corporation, Chicago March 27, 2003 Winchester, Illinois Clinton, Illinois The John Warner Bank, Clinton, Illinois Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

306 Federal Reserve Bulletin • June 2003 Section 3—Continued Applicant(s) Bank(s) Reserve Bank Effective Date Main Street Financial Services Corp, To become a one-bank holding company Cleveland April 4, 2003 Wheeling, West Virginia McCreary National Bancorp, Inc., McCreary National Bank, Cleveland April 8, 2003 Corbin, Kentucky Whitley City, Kentucky Mountain Bancshares, Inc., Mountain State Bank, Atlanta March 31, 2003 Dawsonvlle, Georgia Dawsonville, Georgia MountainBank Financial Corporation, CNB Holdings, Inc., Richmond April 9, 2003 Hendersonville, North Carolina Pulaski, Virginia North Georgia Bancorp, Inc., North Georgia Bank, Atlanta April 28, 2003 Watkinsville, Georgia Watkinsville, Georgia Premier Bancshares, Inc., Mid-America Bancorp, Inc., St. Louis April 8, 2003 Jefferson City, Missouri Jewell, Kansas Heartland Bank, Jewell, Kansas PSB Group, Inc., Peoples State Bank, Chicago April 25, 2003 Madison Heights, Michigan Hamtramck, Michigan Reliance Bancshares, Inc., The Bank of Godfrey, St. Louis March 28, 2003 Des Peres, Missouri Godfrey, Illinois Scott County Bancorp, Inc., JW Bancorp Inc., St. Louis March 27, 2003 Winchester, Illinois Winchester, Illinois John Warner Financial Corporation, Clinton, Illinois The John Warner Bank, Clinton, Illinois Security First Bancshares, Inc., Bank of O'Fallon, St. Louis April 14, 2003 0'Fallon, Illinois 0'Fallon, Illinois TCF Financial Corporation, TransCommunity Bankshares, Minneapolis April 2, 2003 Wayzata, Minnesota Incorporated, Richmond, Virginia Bank of Powhatan, N.A., Powhatan, Virginia Bank of Goochland, N.A., Goochland, Virginia Section 4 Applicant(s) Nonbanking Activity/Company Reserve Bank Effective Date Bay View Capital Corporation, Bay View Acceptance Corporation, San Francisco April 4, 2003 San Mateo, California San Mateo, California DnB Holding ASA, DnB Asset Management (US) Inc., New York April 16, 2003 Oslo, Norway New York, New York Standard Bancshares, Inc., Security Financial Bancorp, Inc., Chicago April 23, 2003 Hickory Hills, Illinois St. John, Indiana Security Federal Bank & Trust, St. John, Indiana Sections 3 and 4 Applicant(s) Nonbanking Activity/Company Reserve Bank Effective Date Wayne Bancorp, Inc., Banc Services Corp., Cleveland April 24, 2003 Wooster, Ohio Orrville, Ohio Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 307 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 Arvest Bank, The Bank of Yellville, St. Louis April 8,2003 Fayetteville, Arkansas Yellville, Arkansas Chippewa Valley Bank, The Savings Bank & Trust Company, Cleveland April 24, 2003 Wadsworth, Ohio Orrville, Ohio First State Bank Southwest, Bremer Bank N.A., Minneapolis April 24,2003 Pipestone, Minnesota Marshall, Minnesota Security Bank Minnesota, First State Bank of Emmons, Minneapolis April 23, 2003 Albert Lea, Minnesota Emmons, Minnesota PENDING CASES INVOLVING THE BOARD OF GOVERNORS This list of pending cases does not include suits against the on constitutional grounds the failure to pay interest on Federal Reserve Banks in which the Board of Governors is reserve accounts held at Federal Reserve Banks. not named a party. Artis v. Greenspan, No. 01-CV-0400 (EGS) (D.D.C., complaint filed February 22, 2001). Employment discrim- Albrecht v. Board of Governors, No. 02-5325 (D.C. Cir., ination action. On August 15, 2001, the district court filed October 18, 2002). Appeal of district court order consolidated the action with Artis v. Greenspan, No. 99dismissing challenge to the method of funding of the CV-2073 (EGS) (D.D.C., filed August 3, 1999), also an retirement plan for certain Board employees. employment discrimination action. Caesar v. United States, No. 02-0612 (EGS) (D.D.C.), Fraternal Order of Police v. Board of Governors, removed on April 1, 2002 from No. 02-1502 (D.C. No. 1:98CV03116 (WBB)(D.D.C., filed December 22, Superior Court, originally filed March 1, 2002). Action 1998). Declaratory judgment action challenging Board seeking damages for personal injury. On March 30, regulation on labor-management relations at Reserve 2003, the district court granted the government's motion Banks. to dismiss the action. Community Bank & Trust v. United States, No. 01-571C (Ct. Fed, CI., filed October 3, 2001). Action challenging Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A1 Financial and Business Statistics A3 GUIDE TO TABLES Federal Finance A25 Federal debt subject to statutory limitation DOMESTIC FINANCIAL STATISTICS A25 Gross public debt of U.S. Treasury— Types and ownership Money Stock and Bank Credit A26 U.S. government securities A4 Reserves and money stock measures dealers—Transactions A5 Reserves of depository institutions and Reserve Bank A27 U.S. government securities dealers— credit Positions and financing A6 Reserves and borrowings—Depository A28 Federal and federally sponsored credit institutions agencies—Debt outstanding Policy Instruments Securities Markets and Corporate Finance A7 Federal Reserve Bank interest rates A29 New security issues—Tax-exempt state and local A8 Reserve requirements of depository institutions governments and U.S. corporations A9 Federal Reserve open market transactions A30 Open-end investment companies—Net sales and assets Federal Reserve Banks A30 Domestic finance companies—Assets and liabilities A31 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 A3 2 Mortgage markets—New homes A3 3 Mortgage debt outstanding A12 Aggregate reserves of depository institutions and monetary base Consumer Credit A13 Money stock measures A34 Total outstanding Commercial Banking Institutions— A34 Terms Assets and Liabilities Flow of Funds A15 All commercial banks in the United States A16 Domestically chartered commercial banks A35 Funds raised in U.S. credit markets A17 Large domestically chartered commercial banks A37 Summary of financial transactions A19 Small domestically chartered commercial banks A3 8 Summary of credit market debt outstanding A20 Foreign-related institutions A39 Summary of financial assets and liabilities Financial Markets DOMESTIC NONFINANCIAL STATISTICS All Commercial paper outstanding All Prime rate charged by banks on short-term Selected Measures business loans A23 Interest rates—Money and capital markets A40 Output, capacity, and capacity utilization A24 Stock market—Selected statistics A42 Industrial production—Indexes and gross value Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

2 Federal Reserve Bulletin • June 2003 INTERNATIONAL STATISTICS Reported by Nonbanking Business Enterprises in the United States Summary Statistics A52 Liabilities to unaffiliated foreigners A44 U.S. international transactions A53 Claims on unaffiliated foreigners A45 U.S. reserve assets A45 Foreign official assets held at Federal Reserve Securities Holdings and Transactions Banks A54 Foreign transactions in securities A46 Selected U.S. liabilities to foreign official A55 Marketable U.S. Treasury bonds and institutions notes—Foreign transactions Reported by Banks in the United States Interest and Exchange Rates A46 Liabilities to, and claims on, foreigners A56 Foreign exchange rates A47 Liabilities to foreigners A49 Banks' own claims on foreigners A57 GUIDE TO SPECIAL TABLES AND A50 Banks' own and domestic customers' claims on foreigners STATISTICAL RELEASES A51 Banks' own claims on unaffiliated foreigners A58 INDEX TO STATISTICAL TABLES Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A3 Guide to Tables SYMBOLS AND ABBREVIATIONS c Corrected G-10 Group of Ten e Estimated GDP Gross domestic product n.a. Not available GNMA Government National Mortgage Association n.e.c. Not elsewhere classified GSE Government-sponsored enterprise P Preliminary HUD Department of Housing and Urban r Revised (Notation appears in column heading Development when about half the figures in the column have IMF International Monetary Fund been revised from the most recently published IOs Interest only, stripped, mortgage-backed securities table.) IPCs Individuals, partnerships, and corporations * Amount 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 in millions) MSA Metropolitan statistical area 0 Calculated to be zero NAICS North American Industry Classification System Cell not applicable NOW Negotiable order of withdrawal ABS Asset-backed security OCDs Other checkable deposits 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 POs Principal only, stripped, mortgage-backed securities CRA Community Reinvestment Act of 1977 REIT Real estate investment trust FAMC Federal Agricultural Mortgage Corporation REMICs Real estate mortgage investment conduits FFB Federal Financing Bank RHS Rural Housing Service FHA Federal Housing Administration RP Repurchase agreement FHLBB Federal Home Loan Bank Board RTC Resolution Trust Corporation FHLMC Federal Home Loan Mortgage Corporation SCO Securitized credit obligation FmHA Farmers Home Administration SDR Special drawing right FNMA Federal National Mortgage Association SIC Standard Industrial Classification FSA Farm Service Agency TIIS Treasury inflation-indexed securities FSLIC Federal Savings and Loan Insurance Corporation VA Department of Veterans Affairs G-7 Group of Seven 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 U.S. 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 NonfinancialS tatistics • June 2003 1.10 RESERVES AND MONEY STOCK MEASURES Percent annual rate of change, seasonally adjusted1 2002 2003 2002 2003 MMoonneettaarryy oorr ccrreeddiitt aaggggrreeggaattee Q2 Q3 Q4 Qi Nov. Dec. Jan.' Feb.' Mar. Reserves of depository institutions2 1 Total -13.5 -2.0 .3 11.2 15.4 13.0 14.7 4.4 5.5 2 Required -12.4 -4.8 -2.1 11.6 13.9 1.6 26.0 -3.1 14.9 3 Nonborrowed -14.0 -3.5 1.2 12.6 11.5 19.0 16.3 4.4 5.6 4 Monetary base3 7.5 6.9 5.0 7.6 5.7 7.5 6.7 10.0 6.6 Concepts of money4 5 Ml -.6 3.1 4.5 7.1 -.9 7.8 2.1 19.8 3.5 6 M2 4.1 9.1 7.1 6.7 8.1 3.2 6.4 11.6 3.2 7 M3 4.1 7.7 7.6r 5.4 17.3' 7.8' -.4 7.6 1.6 Nontransaction components 8 In M25 5.4 10.8 7.8 6.6 10.5 2.0' 7.5 9.4 3.1 9 In M3 only6 4.3r 4.5 8.6r 2.6 37.4' 17.9' -14.6 -1.1 -1.7 Time and savings deposits Commercial banks 10 Savings, including MMDAs 15.1 20.1 16.9 13.5 20.9 3.6 18.7 16.0 4.5 11 Small time7 -6.3 -6.3 -9.1 -7.5 -7.3 -9.0 -7.0 -7.2 -7.1 12 Large time8-9 12.4 3.7 ^1.0 -1.7 -13.5' -32.5' 14.8 14.4 -8.2 Thrift institutions 13 Savings, including MMDAs 24.0 20.5 20.5 22.2 13.9 21.7 21.6 27.4 19.1 14 Smalltime7 -16.6 -12.3 -6.4' -4.3 -4.4 -2.4' -4.8 -6.4 -2.0 15 Large time8 -8.1 -3.2 11.1 9.3 16.9 15.6 13.4 1.0 -7.1 Money market mutual funds 16 Retail -9.2 47 -4.4 -7.8 1.9 -8.0 -14.6 -3.7 -5.2 17 Institution-only 3.9 -.8 1.9 -5.1 68.7 25.0 -35.3 -20.1 -12.7 Repurchase agreements and eurodollars 18 Repurchase agreements10 -.7 27.5 45.0 27.3 55.3 77.7 -23.8 34.0 41.2 19 Eurodollars'0 -4.4r ,3r 19.3r 5.4 14.7' 20.6' 15.3 -20.5 -11.5 1. Unless otherwise noted, rates of change are calculated from average amounts outstand- time deposits, and retail money fund balances, each seasonally adjusted separately, and ing during preceding month or quarter. adding this result to seasonally adjusted Ml. 2. Figures incorporate adjustments for discontinuities, or "breaks," associated with regula- M3: M2 plus (1) large-denomination time deposits (in amounts of $100,000 or more), (2) tory changes in reserve requirements (See also table 1.20.) balances in institutional money funds, (3) RP liabilities (overnight and term) issued by all 3. The seasonally adjusted, break-adjusted monetary base consists of (1) seasonally depository institutions, and (4) eurodollars (overnight and term) held by U.S. residents at adjusted, break-adjusted total reserves (line 1), plus (2) the seasonally adjusted currency foreign branches of U.S. banks worldwide and at all banking offices in the United Kingdom component of the money stock, plus (3) (for all quarterly reporters on the "Report of and Canada. Excludes amounts held by depository institutions, the U.S. government, money Transaction Accounts, Other Deposits and Vault Cash" and for all weekly reporters whose market funds, and foreign banks and official institutions. Seasonally adjusted M3 is calculated vault cash exceeds their required reserves) the seasonally adjusted, break-adjusted difference by summing large time deposits, institutional money fund balances, RP liabilities, and between current vault cash and the amount applied to satisfy current reserve requirements. eurodollars, each seasonally adjusted separately, and adding this result to seasonally adjusted 4. Composition of the money stock measures is as follows: M2. Ml: (1) currency outside the U.S. Treasury, Federal Reserve Banks, and the vaults of 5. Sum of (1) savings deposits (including MMDAs), (2) small time deposits, and (3) retail depository institutions, (2) travelers checks of nonbank issuers, (3) demand deposits at all money fund balances, each seasonally adjusted separately. commercial banks other than those owed to depository institutions, the U.S. government, and 6. Sum of (1) large time deposits, (2) institutional money fund balances, (3) RP liabilities foreign banks and official institutions, less cash items in the process of collection and Federal (overnight and term) issued by depository institutions, and (4) eurodollars (overnight and Reserve float, and (4) other checkable deposits (OCDs), consisting of negotiable order of term) of U.S. addressees, each seasonally adjusted separately. withdrawal (NOW) and automatic transfer service (ATS) accounts at depository institutions, 7. Small time deposits—including retail RPs—are those issued in amounts of less than credit union share draft accounts, and demand deposits at thrift institutions. Seasonally $100,000. All IRA and Keogh account balances at commercial banks and thrift institutions adjusted Ml is computed by summing currency, travelers checks, demand deposits, and are subtracted from small time deposits. OCDs, each seasonally adjusted separately. 8. Large time deposits are those issued in amounts of $100,000 or more, excluding those M2: Ml plus (1) savings (including MMDAs), (2) small-denomination time deposits (time booked at international banking facilities. deposits—including retail RPs—in amounts of less than $100,000), and (3) balances in retail 9. Large time deposits at commercial banks less those held by money market funds, money market mutual funds. Excludes individual retirement accounts (IRAs) and Keogh depository institutions, the U.S. government, and foreign banks and official institutions. balances at depository institutions and money market funds. 10. Includes both overnight and term. Seasonally adjusted M2 is calculated by summing savings deposits, small-denomination Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Money Stock and Bank Credit A5 1.11 RESERVE BALANCES OF DEPOSITORY INSTITUTIONS1 Millions of dollars Average of Average of daily figures for week ending on date indicated daily figures Factor 2003 2003 Jan. Feb. Mar. Feb. 12 Feb. 19 Feb. 26 Mar. 5 Mar. 12 Mar. 19 Mar. 26 SUPPLYING RESERVE FUNDS 1 Reserve Bank credit outstanding 694,979 696,613 701,365 691,400 701,766 696,923 701,969 696,336 704,865 698,981 2 Securities held outright 629,416 631,830 639,323 629,951 631,009 634,932 636,873 638,586 639,517 640,129 3 U.S. Treasury2 629,406 631,820 639,313 629,941 630,999 634,922 636,863 638,576 639,507 640,119 4 Bills3 226,682 228,026 231,580 226,941 227,294 230,030 230,889 231,172 231,481 231,892 5 Notes and bonds, nominal3 389,219 390,305 394,110 389,504 390,217 391,412 392,496 393,911 394,519 394,621 6 Notes and bonds, inflation-indexed3 12,242 12,242 12,353 12,242 12,242 12,242 12,242 12,242 12,242 12,324 7 Inflation compensation4 1,263 1,247 1,270 1,253 1,245 1,238 1,236 1,251 1,264 1,282 8 Federal agency3 10 10 10 10 10 10 10 10 10 10 9 Repurchase agreements5 25,395 24,558 23,356 19,285 30,067 23,321 27,136 19,214 26,500 19,286 10 Loans to depository institutions 28 19 24 31 19 13 29 45 18 10 11 Primary credit6 15 15 17 28 14 10 24 36 9 2 12 Secondary credit6 0 0 0 0 0 0 0 0 0 0 13 Seasonal credit 11 4 7 3 5 4 6 9 8 8 14 Adjustment credit6 2 0 0 0 0 0 0 0 0 0 15 Float 565 977 595 1,698 831 1,322 484 472 805 1,409 16 Other Federal Reserve assets 39,575 39,229 38,066 40,436 39,840 37,335 37,447 38,019 38,025 38,147 17 Gold stock 11,043 11,043 11,043 11,043 11,043 11,043 11,043 11,043 11,043 11,043 18 Special drawing rights certificate account 2,200 2,200 2,200 2,200 2,200 2,200 2,200 2,200 2,200 2,200 19 Treasury currency outstanding 34,597 34,650 34,738 34,630 34,657 34,684 34,710 34,724 34,738 34,752 ABSORBING RESERVE FUNDS 20 Currency in circulation 677,745 680,336 683,783 678,459 682,830 682,262 682,387 683,021 683,701 684,495 21 Reverse repurchase agreements7 18,534 18,222 18,755 18,949 17,925 17,738 18,078 18,332 19,802 18,320 22 Foreign official and international accounts 18,534 17,954 18,715 17,878 17,925 17,738 18,078 18,332 19,623 18,320 23 Dealers 0 268 40 1,071 0 0 0 0 179 0 24 Treasury cash holdings 366 354 369 356 358 347 345 356 372 394 25 Deposits with Federal Reserve Banks, other than reserve balances 17,053 16,236 16,842 15,954 16,157 16,510 16,028 16,897 16,130 17,783 26 U.S. Treasury, general account 5,773 5,053 5,339 4,681 5,048 5,249 4,909 5,196 4,979 5,916 27 Foreign official 126 125 163 115 132 111 186 105 159 240 28 Service-related 10,907 10,819 11,118 10,918 10,730 10,904 10,721 11,363 10,760 11,412 29 Required clearing balances 10,484 10,330 10,601 10,317 10,315 10,337 10,336 10,372 10,373 10,977 30 Adjustments to compensate for float 423 489 517 601 415 567 385 991 387 435 31 Other 247 239 221 239 247 245 212 233 231 215 32 Other liabilities and capital 19,651 19,664 19,732 19,450 19,659 19,964 19,805 20,015 19,538 19,412 33 Reserve balances with Federal Reserve Banks8 .... 9,469 9,693 9,865 6,104 12,738 8,029 13,279 5,682 13,304 6,571 End-of-month figures Wednesday figures Jan. Feb. Mar. Feb. 12 Feb. 19 Feb. 26 Mar. 5 Mar. 12 Mar. 19 Mar. 26 SUPPLYING RESERVE FUNDS 1 Reserve Bank credit outstanding 697,826 701,055 710,555 691,731 706,863 700,685 700,069 695,705 708,944 704,126 2 Securities held outright 629,416 636,921 641,474 630,957 631,273 636,006 637,149 638,724 639,899 640,901 3 U.S. Treasury2 629,406 636,911 641,464 630,947 631,263 635,996 637,139 638,714 639,889 640,891 4 Bills3 226,682 230,843 232,706 227,238 227,561 230,606 231,061 231,305 231,756 232,143 1 65 I N N n o o fl t t a e e t s s i o a a n n n d d c o b b m o o n n p d d e s n s , , s a i n n t o i f o m la n i t 4 n i o a n l3 - indexed3 38 1 9 2 1 , , , 2 2 2 1 6 4 9 3 2 39 1 2 2 1 , , , 5 2 2 9 4 3 3 2 3 39 1 4 1 2 , , , 6 3 8 2 2 1 1 2 4 39 1 0 1 2 , , , 2 2 2 1 5 4 7 0 2 39 1 0 2 1 , , , 2 2 2 1 4 4 7 2 2 39 1 1 2 1 , , , 9 2 2 1 3 4 3 5 2 39 1 2 2 1 , , , 5 2 2 9 4 4 3 2 2 39 1 3 1 2 , , , 9 2 2 1 5 4 1 6 2 39 1 4 2 1 , , , 6 2 2 2 6 4 1 9 2 39 1 4 2 1 , , , 6 3 8 2 1 1 1 2 4 8 Federal agency3 10 10 10 10 10 10 10 10 10 10 9 Repurchase agreements5 24,750 26,900 31,750 20,746 34,496 25,750 23,250 18,750 27,000 25,500 10 Loans to depository institutions 7 5 30 4 17 6 11 9 17 7 11 Primary credit6 1 1 25 0 13 1 1 1 11 1 12 Secondary credit6 0 0 0 0 0 0 0 0 0 0 13 Seasonal credit 6 4 4 4 4 5 10 8 6 6 14 Adjustment credit6 0 0 0 0 0 0 0 0 0 0 15 Float 3,768 4 -1,197 -516 3,838 1,307 1,884 84 4,065 -732 16 Other Federal Reserve assets 39,884 37,225 38,499 40,541 37,239 37,616 37,775 38,139 37,964 38,450 17 Gold stock 11,043 11,043 11,043 11,043 11,043 11,043 11,043 11,043 11,043 11,043 18 Special drawing rights certificate account 2,200 2,200 2,200 2,200 2,200 2,200 2,200 2,200 2,200 2,200 19 Treasury currency outstanding 34,597 34,710 34,766 34,630 34,657 34,684 34,710 34,724 34,738 34,752 ABSORBING RESERVE FUNDS 20 Currency in circulation 674,736 681,634 685,759 681,216 684,226 682,915 683,678 684,415 685,222 686,233 21 Reverse repurchase agreements7 18,370 18,018 19,418 17,604 17,850 17,421 17,959 17,912 18,430 18,231 22 Foreign official and international accounts 18,370 18,018 19,418 17,604 17,850 17,421 17,959 17,912 17,180 18,231 23 Dealers 0 0 0 0 0 0 0 0 1,250 0 24 Treasury cash holdings 361 343 373 360 348 343 354 367 398 373 25 Deposits with Federal Reserve Banks, other than reserve balances 16,558 15,406 18,474 14,777 15,553 16,246 16,565 16,487 14,778 17,676 26 U.S. Treasury, general account 5,509 4,268 6,746 3,527 4,407 4,950 5,501 4,775 3,607 5,927 27 Foreign official 102 224 254 103 134 154 105 116 150 162 28 Service-related 10,724 10,721 11,263 10,918 10,730 10,904 10,721 11,363 10,760 11,412 29 Required clearing balances 10,356 10,336 10,978 10,317 10,315 10,337 10,336 10,372 10,373 10,977 30 Adjustments to compensate for float 368 385 285 601 415 567 385 991 387 435 31 Other 223 193 211 228 281 238 238 233 261 175 32 Other liabilities and capital 19,478 19,739 20,230 19,265 19,665 19,699 19,693 19,725 19,147 19,601 33 Reserve balances with Federal Reserve Banks8 .... 16,163 13,868 14,312 6,383 17,121 11,988 9,772 4,766 18,951 10,008 1. Amounts of vault cash held as reserves are shown in table 1.12, line 2. 6. The Federal Reserve Banks began offering primary credit and secondary credit on 2. Includes securities lent to dealers, which are fully collateralized by other U.S. Treasury January 9, 2003. The adjustment credit program was discontinued. securities. 7. Cash value of agreements, which are fully collateralized by U.S. Treasury securities. 3. Face value of the securities. 8. Excludes required clearing balances and adjustments to compensate for float. 4. Compensation that adjusts for the effect of inflation on the original face value of inflation-indexed securities. 5. Cash value of agreements, which are fully collateralized by U.S. Treasury and federal agency securities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A6 Domestic NonfinancialS tatistics • June 2003 1.12 RESERVES AND BORROWINGS Depository Institutions1 Millions of dollars Prorated monthly averages of biweekly averages RRReeessseeerrrvvveee ccclllaaassssssiiifffiiicccaaatttiiiooonnn 2000 2001 2002 2002 2003 Dec. Dec. Dec. Sept. Oct. Nov. Dec. Jan. Feb. Mar. 11111 RRRRReeeeessssseeeeerrrrrvvvvveeeee bbbbbaaaaalllllaaaaannnnnccccceeeeesssss wwwwwiiiiittttthhhhh RRRRReeeeessssseeeeerrrrrvvvvveeeee BBBBBaaaaannnnnkkkkksssss22222 7,022 9,053 9,873 8,731 8,836 9,695 9,873 10,004 9,807 9,820 22222 TTTTToooootttttaaaaalllll vvvvvaaaaauuuuulllllttttt cccccaaaaassssshhhhh33333 45,245 43,919 43,334 42,231 42,933 42,144 43,334 46,210 45,939 43,086 33333 AAAAAppppppppppllllliiiiieeeeeddddd vvvvvaaaaauuuuulllllttttt cccccaaaaassssshhhhh44444 31,451 32,024 30,300 30,176 29,849 29,446 30,300 32,738 32,067' 30,747 44444 SSSSSuuuuurrrrrpppppllllluuuuusssss vvvvvaaaaauuuuulllllttttt cccccaaaaassssshhhhh55555 13,794 11,895 13,033 12,055 13,084 12,698 13,033 13,471 13,872' 12,339 55555 TTTTToooootttttaaaaalllll rrrrreeeeessssseeeeerrrrrvvvvveeeeesssss66666 38,473 41,077 40,173 38,907 38,685 39,141 40,173 42,743 41,874' 40,566 66666 RRRRReeeeeqqqqquuuuuiiiiirrrrreeeeeddddd rrrrreeeeessssseeeeerrrrrvvvvveeeeesssss 37,046 39,428 38,176 37,431 37,134 37,525 38,176 41,082 39,966 38,954 77777 EEEEExxxxxccccceeeeessssssssss rrrrreeeeessssseeeeerrrrrvvvvveeeee bbbbbaaaaalllllaaaaannnnnccccceeeeesssss aaaaattttt RRRRReeeeessssseeeeerrrrrvvvvveeeee BBBBBaaaaannnnnkkkkksssss77777 1,427 1,649 1,997 1,476 1,550 1,616 1,997 1,660 1,908 1,612 88888 TTTTToooootttttaaaaalllll bbbbbooooorrrrrrrrrrooooowwwwwiiiiinnnnnggggg aaaaattttt RRRRReeeeessssseeeeerrrrrvvvvveeeee BBBBBaaaaannnnnkkkkksssss 210 67 80 229 143 272 80 27 25 22 99999 PPPPPrrrrriiiiimmmmmaaaaarrrrryyyyy 12 21 14 1111100000 SSSSSeeeeecccccooooonnnnndddddaaaaarrrrryyyyy 0 0 0 1111111111 SSSSSeeeeeaaaaasssssooooonnnnnaaaaalllll ' 111 ' 33 ' 45 ' 169 120 60 45 13 5 8 1111122222 AAAAAdddddjjjjjuuuuussssstttttmmmmmeeeeennnnnttttt 99 34 35 60 23 211 35 2 Biweekly averages of daily figures for two-week periods ending on dates indicated 2002 2003 Nov. 27 Dec. 11 Dec. 25 Jan. 8 Jan. 22 Feb. 5 Feb. 19 Mar. 5 Mar. 19 Apr. 2 11111 RRRRReeeeessssseeeeerrrrrvvvvveeeee bbbbbaaaaalllllaaaaannnnnccccceeeeesssss wwwwwiiiiittttthhhhh RRRRReeeeessssseeeeerrrrrvvvvveeeee BBBBBaaaaannnnnkkkkksssss22222 10,497 9,559 10,408 9,200 10,894 9,336 9,431 10,654 9,500 9,846 22222 TTTTToooootttttaaaaalllll vvvvvaaaaauuuuulllllttttt cccccaaaaassssshhhhh33333 42,605 41,827 43,740 45,148 44,363 50,026 46,005 43,567 42,203 43,916 33333 AAAAAppppppppppllllliiiiieeeeeddddd vvvvvaaaaauuuuulllllttttt cccccaaaaassssshhhhh44444 30,514 29,419 30,292 31,935 31,500 35,378 30,911 32,027' 29,372 31,818 44444 SSSSSuuuuurrrrrpppppllllluuuuusssss vvvvvaaaaauuuuulllllttttt cccccaaaaassssshhhhh55555 12,092 12,408 13,448 13,213 12,863 14,648 15,095 11,540' 12,831 12,099 55555 TTTTToooootttttaaaaalllll rrrrreeeeessssseeeeerrrrrvvvvveeeeesssss66666 41,010 38,978 40,700 41,135 42,394 44,714 40,342 42,681' 38,872 41,663 66666 RRRRReeeeeqqqqquuuuuiiiiirrrrreeeeeddddd rrrrreeeeessssseeeeerrrrrvvvvveeeeesssss 39,441 37,394 38,225 39,495 40,631 43,196 38,009 41,217' 37,211 40,046 77777 EEEEExxxxxccccceeeeessssssssss rrrrreeeeessssseeeeerrrrrvvvvveeeee bbbbbaaaaalllllaaaaannnnnccccceeeeesssss aaaaattttt RRRRReeeeessssseeeeerrrrrvvvvveeeee BBBBBaaaaannnnnkkkkksssss77777 1,569 1,583 2,475 1,640 1,763 1,518 2,332 1,464' 1,660 1,617 88888 TTTTToooootttttaaaaalllll bbbbbooooorrrrrrrrrrooooowwwwwiiiiinnnnnggggg aaaaattttt RRRRReeeeessssseeeeerrrrrvvvvveeeee BBBBBaaaaannnnnkkkkksssss 214 133 57 36 18 34 25 21 32 11 99999 PPPPPrrrrriiiiimmmmmaaaaarrrrryyyyy 9 28 21 17 23 3 1111100000 SSSSSeeeeecccccooooonnnnndddddaaaaarrrrryyyyy 0 0 0 0 0 0 1111111111 SSSSSeeeeeaaaaasssssooooonnnnnaaaaalllll 57 50 ' 48 29 9 6 4 5 9 8 1111122222 AAAAAdddddjjjjjuuuuussssstttttmmmmmeeeeennnnnttttt 157 83 10 8 1. Data in this table also appear in the Board's H.3 (502) weekly statistical release. For 4. All vault cash held during the lagged computation period by "bound" institutions (that ordering address, see inside front cover. Data are not break-adjusted or seasonally adjusted. is, those whose required reserves exceed their vault cash) plus the amount of vault cash 2. Excludes required clearing balances and adjustments to compensate for float and applied during the maintenance period by "nonbound" institutions (that is, those whose vault includes other off-balance-sheet "as-of' adjustments. cash exceeds their required reserves) to satisfy current reserve requirements. 3. Vault cash eligible to satisfy reserve requirements. It includes only vault cash held by 5. Total vault cash (line 2) less applied vault cash (line 3). those banks and thrift institutions that are not exempt from reserve requirements. Dates 6. Reserve balances with Federal Reserve Banks (line 1) plus applied vault cash (line 3). refer to the maintenance periods in which the vault cash can be used to satisfy reserve 7. Total reserves (line 5) less required reserves (line 6). 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 Primary credit' Secondary credit2 Seasonal credit3 Federal Reserve Bank On On Effective date On 5/16/03 5/16/03 5/16/03 Boston 1.20 New York .. . Philadelphia . Cleveland ... Richmond ... Atlanta Chicago St. Louis Minneapolis . Kansas City . Dallas San Francisco Range of rates for primary credit Range (or F.R. Bank Range (or F.R. Bank Range(or F.R. Bank Effective date level)—All of Effective date level)—All of Effective date level)—All of F.R. Banks N.Y. F.R. Banks N.Y. F.R. Banks N.Y. In effect Jan. 9, 2003 2.25 2.25 (beginning of program) Range of rates for adjustment credit in recent years4 Range(or F.R. Bank Range (or F.R. Bank Range (or F.R. Bank level)—All of level)—All of Effective date level)—All of F.R. Banks N.Y. F.R. Banks N.Y. F.R. Banks N.Y. In effect Dec. 31, 1995 5.25 5.25 2000—Feb. 2 5.00-5.25 5.25 2001—June 27 3.25-3.50 3.25 4 5.25 5.25 29 3.25 3.25 1996—Jan. 31 5.00-5.25 5.00 Mar. 21 5.25-5.50 5.50 Aug. 21 3.00-3.25 3.00 Feb. 3 .. . 5.00 5.00 23 5.50 5.50 23 3.00 3.00 May 16 5.50-6.00 5.50 Sept. 17 2.50-3.00 2.50 1998—Oct. 15 4.75-5.00 4.75 19 6.00 6.00 18 2.50 2.50 16 . .. 4.75 4.75 Oct. 2 2.00-2.50 2.00 Nov. 17 . .. 4.50-4.75 4.50 2001—Jan. 3 5.75-6.00 5.75 4 2.00 2.00 19 ... 4.50 4.50 4 5.50-5.75 5.50 Nov. 6 1.50-2.00 1.50 5 5.50 5.50 8 1.50 1.50 1999—Aug. 24 .. . 4.50-4.75 4.75 31 5.00-5.50 5.00 Dec. 11 1.25-1.50 1.25 26 .. . 4.75 4.75 Feb. 1 5.00 5.00 13 1.25 1.25 Nov. 16 . .. 4.75-5.00 4.75 Mar. 20 4.50-5.00 4.50 18 ... 5.00 5.00 21 4.50 4.50 2002—Nov. 6 0.75-1.25 0.75 Apr. 18 4.00-4.50 4.00 7 0.75 0.75 20 4.00 4.00 2001—May 15 3.50-4.00 3.50 In effect Jan. 8, 2003 0.75 0.75 17 3.50 3.50 (end of program) 1. Available for very short terms as a backup source of liquidity to depository institutions into account rates charged by market sources of funds and ordinarily is reestablished on the that are in generally sound financial condition in the judgment of the lending Federal Reserve first business day of each two-week reserve maintenance period. Bank. 4. Was available until January 8, 2003, to help depository institutions meet temporary 2. Available in appropriate circumstances to depository institutions that do not qualify for needs for funds that could not be met through reasonable alternative sources. For earlier data, primary credit. see the following publications of the Board of Governors: Banking and Monetary Statistics, 3. Available to help relatively small depository institutions meet regular seasonal needs for 1914-1941, and 1941-1970\ and the Statistical Digest, 1970-1979, 1980-1989, and funds that arise from a clear pattern of intrayearly movements in their deposits and loans and 1990-1995. See also the Board's Statistics: Releases and Historical Data web pages that cannot be met through special industry lenders. The discount rate on seasonal credit takes (http://www.federalreserve.gov/releases/H15/data.htm). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A8 Domestic Nonfinancial Statistics • June 2003 1.15 RESERVE REQUIREMENTS OF DEPOSITORY INSTITUTIONS1 Requirement Type of deposit Net transaction accounts1 1 $0 milIion-$6 million3 12/26/02 2 More than $6 million-$42.1 million' 12/26/02 3 More than $42.1 million5 12/26/02 4 Nonpersonal time deposits6 12/27/90 5 Eurocurrency liabilities7 12/27/90 1. Required reserves must be held in the form of deposits with Federal Reserve Banks or 4. The Monetary Control Act of 1980 requires that the amount of transaction accounts vault cash. Nonmember institutions may maintain reserve balances with a Federal Reserve against which the 3 percent reserve requirement applies be modified annually by 80 percent of Bank indirectly, on a pass-through basis, with certain approved institutions. For previous the percentage change in transaction accounts held by all depository institutions, determined reserve requirements, see earlier editions of the Annual Report or the Federal Reserve as of June 30 of each year. Effective with the reserve maintenance period beginning Bulletin. Under the Monetary Control Act of 1980, depository institutions include commercial December 26, 2002, for depository institutions that report weekly, and with the period banks, savings banks, savings and loan associations, credit unions, agencies and branches of beginning January 16, 2003, for institutions that report quarterly, the amount was increased foreign banks, and Edge Act corporations. from $41.3 million to $42.1 million. 2. Transaction accounts include all deposits against which the account holder is permitted 5. The reserve requirement was reduced from 12 percent to 10 percent on April 2, 1992, to make withdrawals by negotiable or transferable instruments, payment orders of with- for institutions that report weekly, and on April 16, 1992, for institutions that report quarterly. drawal, or telephone or preauthorized transfers for the purpose of making payments to third 6. For institutions that report weekly, the reserve requirement on nonpersonal time deposits persons or others. However, accounts subject to the rules that permit no more than six with an original maturity of less than 1.5 years was reduced from 3 percent to 1.5 percent for preauthorized, automatic, or other transfers per month (of which no more than three may be the maintenance period that began December 13, 1990, and to zero for the maintenance by check, draft, debit card, or similar order payable directly to third parties) are savings period that began December 27, 1990. For institutions that report quarterly, the reserve deposits, not transaction accounts. requirement on nonpersonal time deposits with an original maturity of less than 1.5 years was 3. Under the Garn-St Germain Depository Institutions Act of 1982, the Board adjusts the reduced from 3 percent to zero on January 17, 1991. amount of reservable liabilities subject to a zero percent reserve requirement each year for the The reserve requirement on nonpersonal time deposits with an original maturity of 1.5 succeeding calendar year by 80 percent of the percentage increase in the total reservable years or more has been zero since October 6, 1983. liabilities of all depository institutions, measured on an annual basis as of June 30. No 7. The reserve requirement on eurocurrency liabilities was reduced from 3 percent to zero corresponding adjustment is made in the event of a decrease. The exemption applies only to in the same manner and on the same dates as the reserve requirement on nonpersonal time accounts that would be subject to a 3 percent reserve requirement. Effective with the reserve deposits with an original maturity of less than 1.5 years (see note 5). maintenance period beginning December 26, 2002, for depository institutions that report weekly, and with the period beginning January 16, 2003, for institutions that report quarterly, the exemption was raised from $5.7 million to $6.0 million. 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 2002 2003 TTyyppee ooff ttrraannssaaccttiioonn aanndd mmaattuurriittyy 22000000 22000011 22000022 Aug. Sept. Oct. Nov. Dec. Jan. Feb. U.S. TREASURY SECURITIES2 Outright transactions (excluding matched transactions) Treasury bills 1 Gross purchases 8,676 15,503 21,421 529 750 0 250 0 0 4,161 7 Gross sales 0 0 0 0 0 0 0 0 0 0 3 Exchanges 477,904 542,736 657,931 63,083 53,314 62,947 51,394 53,374 71,075 53,860 4 For new bills 477,904 542,736 657,931 63,083 53,314 62,947 51,394 53,374 71,075 53,860 5 Redemptions 24,522 10,095 0 0 0 0 0 0 0 0 Others within one year 6 Gross purchases 8,809 15,663 12,720 445 1,286 0 0 0 0 478 7 Gross sales 0 0 0 0 0 0 0 0 0 0 8 Maturity shifts 62,025 70,336 89,108 8,987 11,174 6,143 3,688 13,448 6,216 3,214 9 Exchanges -54,656 -72,004 -92,075 -5,040 -15,189 -5,435 -1,419 -12,059 -6,834 -13,313 10 Redemptions 3,779 16,802 0 0 0 0 0 0 0 0 One to five years 11 Gross purchases 14,482 22,814 12,748 1,921 0 0 0 339 0 2,127 12 Gross sales 0 0 0 0 0 0 0 0 0 0 N Maturity shifts -52,068 -45,211 -73,093 -629 -11,174 -6,143 -2,380 -13,448 -6,216 2,160 14 Exchanges 46,177 64,519 88,276 3,396 15,189 5,435 1,308 12,059 6,834 11,817 Five to ten years 15 Gross purchases 5,871 6,003 5,074 690 51 0 0 314 0 769 16 Gross sales 0 0 0 0 0 0 0 0 0 0 17 Maturity shifts -6,801 -21,063 -11,588 -6,714 0 0 722 0 0 -3,877 18 Exchanges 6,585 6,063 3,800 1,645 0 0 111 0 0 1,497 More than ten years 19 Gross purchases 5,833 8,531 2,280 80 0 0 0 0 0 0 70 Gross sales 0 0 0 0 0 0 0 0 0 0 21 Maturity shifts -3,155 -4,062 -4,427 -1,645 0 0 -2,030 0 0 -1,497 22 Exchanges 1,894 1,423 0 0 0 0 0 0 0 0 All maturities 23 Gross purchases 43,670 68,513 54,242 3,665 2,087 0 250 653 0 7,534 7.4 Gross sales 0 0 0 0 0 0 0 0 0 0 25 Redemptions 28,301 26,897 0 0 0 0 0 0 0 0 Matched transactions 26 Gross purchases 4,415,905 4,722,667 4,981,624 495,729 449,250 429,029 378,381 195,565 0 0 27 Gross sales 4,397,835 4,724,743 4,958,437 497,031 449,986 425,399 377,535 175,820 0 0 Repurchase agreements 28 Gross purchases 0 0 0 0 0 00 0 00 0 00 29 Gross sales 0 0 0 0 0 0 0 0 0 0 Reverse repurchase agreements 30 Gross purchases 0 0 23 L,272R 0 0 0 0 231,272' 392,530' 334433,,774488 31 Gross sales 0 0 252,363' 0 0 0 0 252,363' 389,810' 343,395 32 Net change in U.S. Treasury securities 33,439 39,540 56,339' 2,363 1,351 3,630 1,096 -693' 2,721' 7,887 FEDERAL AGENCY OBLIGATIONS Outright transactions 33 Gross purchases 0 0 0 0 0 0 0 0 0 0 34 Gross sales 0 0 0 0 0 0 0 0 0 0 35 Redemptions 51 120 0 0 0 0 0 0 0 0 Repurchase agreements 36 Gross purchases 0 0 0 0 0 0 0 0 0 0 37 Gross sales 0 0 0 0 0 0 0 0 0 0 38 Net change in federal agency obligations -51 -120 0 0 0 0 0 0 0 0 TRIPARTY OBLIGATIONS Repurchase agreements 39 Gross purchases 890,236 1,497,713 1,143,126 84,000 93,500 72,000 113,501 112,750 135,749 121,896 40 Gross sales 987,501 1,490,838 1,153,876 80,500 94,750 77,250 101,501 101,750 150,499 119,746 41 Net change in triparty obligations -97,265 6,875 -10,750 3,500 -1,250 -5,250 12,000 11,000 -14,750 2,150 42 Total net change in System Open Market Account . . -63,877 46,295 45,589r 5,863 101 -1,620 13,096 10,307r -12,029r 10,037 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 Account; all other figures increase such holdings. principal of inflation-indexed securities. Transactions include the rollover of inflation compensation into new securities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A10 DomesticN onfinancial Statistics • June 2003 1.18 FEDERAL RESERVE BANKS Condition and Federal Reserve Note Statements1 Millions of dollars Wednesday End of month AAAccccccooouuunnnttt 2003 2003 Feb. 26 Mar. 5 Mar. 12 Mar. 19 Mar. 26 Jan. Feb. Mar. Consolidated condition statement ASSETS 1 Gold certificate account 11,039 11,039 11,039 11,039 11,039 11,039 11,039 11,038 2 Special drawing rights certificate account 2,200 2,200 2,200 2,200 2,200 2,200 2,200 2,200 3 Coin 1,100 1,080 1,070 1,071 1,081 1,148 1,104 1,106 4 Securities, repurchase agreements, and loans 661,761 660,409 657,483 666,915 666,408 654,173 663,826 673,253 5 Securities held outright 636,006 637,149 638,724 639,899 640,901 629,416 636,921 641,474 6 U.S. Treasury2 635,996 637,139 638,714 639,889 640,891 629,406 636,911 641,464 7 Bills3 230,606 231,061 231,305 231,756 232,143 226,682 230,843 232,706 8 Notes and bonds, nominal3 391,913 392,593 393,911 394,621 394,621 389,219 392,593 394,621 9 Notes and bonds, inflation-indexed3 12,242 12,242 12,242 12,242 12,814 12,242 12,242 12,814 10 Inflation compensation4 1,235 1,242 1,256 1,269 1,312 1,263 1,233 1,322 11 Federal agency3 10 10 10 10 10 10 10 10 12 Repurchase agreements5 25,750 23,250 18,750 27,000 25,500 24,750 26,900 31,750 13 Loans 6 11 9 17 7 7 5 30 14 Items in process of collection 9,197 10,984 7,890 11,532 6,565 9,038 6,051 2,129 15 Bank premises 1,557 1,555 1,557 1,557 1,558 1,540 1,554 1,557 16 Other assets 36,130 36,380 36,762 36,579 37,121 38,225 35,745 37,190 17 Denominated in foreign currencies6 17,330 17,473 17,536 16,971 17,050 17,075 17,246 17,383 18 All other7 18,800 18,908 19,226 19,609 20,070 21,151 18,499 19,807 19 Total assets 722,984 723,648 718,001 730,894 725,971 717,363 721,519 728,474 LIABILITIES 20 Federal Reserve notes, net of F.R. Bank holdings 649,670 650,398 651,124 651,949 652,930 641,644 648,366 652,467 21 Reverse repurchase agreements8 17,421 17,959 17,912 18,430 18,231 18,370 18,018 19,418 22 Deposits 28,898 26,825 21,343 33,960 28,079 31,982 29,446 33,998 23 Depository institutions 23,556 20,980 16,219 29,942 21,815 26,147 24,761 26,787 24 U.S. Treasury, general account 4,950 5,501 4,775 3,607 5,927 5,509 4,268 6,746 25 Foreign official 154 105 116 150 162 102 224 254 26 Other 238 238 233 261 175 223 193 211 27 Deferred availability cash items 7,296 8,773 7,897 7,409 7,130 5,890 5,950 2,362 28 Other liabilities and accrued dividends9 2,276 2,250 2,265 2,224 2,248 2,267 2,277 2,232 29 Total liabilities 705,561 706,205 700,541 713,972 708,618 700,152 704,057 710,476 CAPITAL ACCOUNTS 30 Capital paid in 8,440 8,478 8,491 8,494 8,493 8,400 8,456 8,505 31 Surplus 8,380 8,380 8,380 8,297 8,380 8,380 8,380 8,380 32 Other capital accounts 603 584 589 132 480 431 626 1,113 33 Total capital 17,423 17,442 17,460 16,923 17,352 17,211 17,462 17,998 MEMO 34 Marketable securities held in custody for foreign official and international accounts310 880,187 896,617 898,979 894,699 894,732 863,815 888,946 901,060 35 U.S. Treasury 702,807 717,786 721,591 716,749 715,261 694,983 710,187 720,666 36 Federal agency 177,380 178,831 177,389 177,950 179,471 168,832 178,759 180,393 Federal Reserve note and collateral statement 37 Federal Reserve notes, net of F.R. Bank holdings 649,670 650,398 651,124 651,949 652,930 641,644 648,366 652,467 38 Collateral held against Federal Reserve notes 649,670 650,398 651,124 651,949 652,930 641,644 648,366 652,467 39 Gold certificate account 11,039 11,039 11,039 11,039 11,039 11,039 11,039 11,038 40 Special drawing rights certificate account 2,200 2,200 2,200 2,200 2,200 2,200 2,200 2,200 41 U.S. Treasury and agency securities pledged" 636,432 637,159 637,886 638,710 639,691 628,405 635,128 639,229 42 Other eligible assets 0 0 0 0 0 0 0 0 MEMO 43 Total U.S. Treasury and agency securities" 661,756 660,399 657,474 666,899 666,401 654,166 663,821 673,224 44 Less: face value of securities under reverse repurchase agreements12 17,427 17,965 17,918 18,436 18,237 18,379 18,028 19,425 45 U.S. Treasury and agency securities eligible to be pledged .... 644,329 642,433 639,556 648,462 648,163 635,787 645,794 653,798 1. Some of the data in this table also appear in the Board's H.4.1 (503) weekly statistical 8. Cash value of agreements, which are fully collateralized by U.S. Treasury securities. release. For ordering address, see inside front cover. 9. Includes exchange-translation account reflecting the daily revaluation at market 2. Includes securities lent to dealers, which are fully collateralized by other U.S. Treasury exchange rates of foreign exchange commitments. securities. 10. Includes U.S. Treasury STRIPS and other zero coupon bonds at face value. 3. Face value of the securities. 11. Includes face value of U.S. Treasury and agency securities held outright, compensation 4. Compensation that adjusts for the effect of inflation on the original face value of to adjust for the effect of inflation on the original face value of inflation-indexed securities, inflation-indexed securities. and cash value of repurchase agreements. 5. Cash value of agreements, which are fully collateralized by U.S. Treasury and federal 12. Face value of agreements, which are fully collateralized by U.S. Treasury securities. agency securities. 6. Valued daily at market exchange rates. 7. Includes special investment account at the Federal Reserve Bank of Chicago in Treasury bills maturing within ninety days. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Reserve Banks All 1.19 FEDERAL RESERVE BANKS Maturity Distribution of Loan and Security Holding Millions of dollars Wednesday End of month TTTyyypppeee ooofff hhhooollldddiiinnnggg aaannnddd mmmaaatttuuurrriiitttyyy 2003 2003 Feb. 26 Mar. 5 Mar. 12 Mar. 19 Mar. 26 Jan. Feb. Mar. 1 Total loans 6 11 9 17 7 7 5 30 2 Within fifteen days1 6 1 4 17 7 6 5 30 3 Sixteen days to ninety days 0 10 5 0 0 1 0 0 4 91 days to 1 year 0 0 0 0 0 0 0 0 5 Total U.S. Treasury securities2 635,996 637,139 638,714 639,889 640,891 629,406 636,911 641,464 6 Within fifteen days' 45,075 35,519 35,307 44,050 44,763 32,974 23,882 24,647 7 Sixteen days to ninety days 133,699 140,723 141,821 133,419 133,717 147,674 146,519 146,179 8 Ninety-one days to one year 146,752 149,160 149,837 149,946 149,322 142,243 147,029 149,328 9 One year to five years 178,982 180,176 180,179 180,893 180,897 175,436 187,927 189,111 10 Five years to ten years 51,659 51,730 51,734 51,738 52,287 51,240 51,727 52,290 11 More than ten years 79,828 79,831 79,837 79,842 79,904 79,840 79,827 79,908 12 Total federal agency obligations 10 to 10 to 10 10 10 10 13 Within fifteen days' 0 0 0 0 0 0 0 0 14 Sixteen days to ninety days 0 0 0 0 0 0 0 0 15 Ninety-one days to one year 10 10 10 10 10 10 10 10 16 One year to five years 0 0 0 0 0 0 0 0 17 Five years to ten years 0 0 0 0 0 0 0 0 18 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 effects 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 Nonfinancial Statistics • June 2003 1.20 AGGREGATE RESERVES OF DEPOSITORY INSTITUTIONS AND MONETARY BASE1 Billions of dollars, averages of daily figures 2002 2003 11999999 22000000 22000011 22000022 IItteemm DDeecc.. DDeecc.. DDeecc.. DDeecc.. Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Seasonally adjusted AADDJJUUSSTTEEDD FFOORR CCHHAANNGGEESS IINN RREESSEERRVVEE RREEQQUUIIRREEMMEENNTTSS22 11 TToottaall rreesseerrvveess33 41.81 38.54 41.24 40.12 39.98 39.25 39.18 39.69 40.12 40.61 40.76 40.94 22 NNoonnbboorrrroowweedd rreesseerrvveess44 41.49 38.33 41.18 40.04 39.64 39.02 39.04 39.41 40.04 40.58 40.73 40.92 33 RReeqquuiirreedd rreesseerrvveess 40.51 37.11 39.60 38.12 38.34 37.78 37.63 38.07 38.12 38.95 38.85 39.33 44 MMoonneettaarryy bbaassee55 593.14 584.72 635.56 681.77 669.93 671.45 674.30 677.52 681.77 685.59 691.31r 695.13 Not seasonally adjusted 5 Total reserves6 41.89 38.53 41.20 40.03 39.74 38.78 38.54 38.98 40.03 42.73 41.87 40.56 6 Nonborrowed reserves 41.57 38.32 41.13 39.95 39.41 38.55 38.40 38.71 39.95 42.70 41.85 40.54 7 Required reserves7 40.59 37.10 39.55 38.03 38.10 37.31 36.99 37.37 38.03 41.07 39.97r 38.95 8 Monetary base8 600.72 590.06 639.91 686.17 669.31 669.71 671.48 676.66 686.17 688.27 690.20r 693.87 NOT ADJUSTED FOR CHANGES IN RESERVE REQUIREMENTS9 9 Total reserves10 41.65 38.47 41.08 40.17 39.85 38.91 38.69 39.14 40.17 42.74 41.87 40.57 10 Nonborrowed reserves 41.33 38.26 41.01 40.09 39.52 38.68 38.54 38.87 40.09 42.72 41.85 40.55 11 Required reserves 40.36 37.05 39.43 38.18 38.22 37.43 37.13 37.53 38.18 41.08 39.97 38.95 12 Monetary base11 608.02 596.98 648.74 697.09 679.55 679.96 681.83 687.23 697.09 699.18 700.99r 705.00 13 Excess reserves12 1.30 1.43 1.65 2.00 1.64 1.48 1.55 1.62 2.00 1.66 1.91 1.61 14 Borrowings from the Federal Reserve .32 .21 .07 .08 .33 .23 .14 .27 .08 .03 .03 .02 1. Latest monthly and biweekly figures are available from the Board's H.3 (502) weekly would have been in past periods had current reserve requirements been in effect. Breakstatistical release. Historical data starting in 1959 and estimates of the effect on required adjusted required reserves include required reserves against transactions deposits and nonperreserves of changes in reserve requirements are available from the Money and Reserves sonal time and savings deposits (but not reservable nondeposit liabilities). Projections Section, Division of Monetary Affairs, Board of Governors of the Federal 8. The break-adjusted monetary base equals (1) break-adjusted total reserves (line 6), plus Reserve System, Washington, DC 20551. (2) the (unadjusted) currency component of the money stock, plus (3) (for all quarterly 2. Figures reflect adjustments for discontinuities, or "breaks," associated with regulatory reporters on the "Report of Transaction Accounts, Other Deposits and Vault Cash" and for all changes in reserve requirements. (See also table 1.10.) those weekly reporters whose vault cash exceeds their required reserves) the break-adjusted 3. Seasonally adjusted, break-adjusted total reserves equal seasonally adjusted, break- difference between current vault cash and the amount applied to satisfy current reserve adjusted required reserves (line 4) plus excess reserves (line 16). requirements. 4. Seasonally adjusted, break-adjusted nonborrowed reserves equal seasonally adjusted, 9. Reflects actual reserve requirements, including those on nondeposit liabilities, with no break-adjusted total reserves (line 1) less total borrowings of depository institutions from the adjustments to eliminate the effects of discontinuities associated with regulatory changes in Federal Reserve (line 17). reserve requirements. 5. The seasonally adjusted, break-adjusted monetary base consists of (1) seasonally 10. Reserve balances with Federal Reserve Banks plus vault cash used to satisfy reserve adjusted, break-adjusted total reserves (line 1), plus (2) the seasonally adjusted currency requirements. component of the money stock, plus (3) (for all quarterly reporters on the "Report of 11. The monetary base, not break-adjusted and not seasonally adjusted, consists of (1) total Transaction Accounts, Other Deposits and Vault Cash" and for all those weekly reporters reserves (line 11), plus (2) required clearing balances and adjustments to compensate for float whose vault cash exceeds their required reserves) the seasonally adjusted, break-adjusted at Federal Reserve Banks, plus (3) the currency component of the money stock, plus (4) (for difference between current vault cash and the amount applied to satisfy current reserve all quarterly reporters on the "Report of Transaction Accounts, Other Deposits and Vault requirements. Cash" and for all those weekly reporters whose vault cash exceeds their required reserves) the 6. Break-adjusted total reserves equal break-adjusted required reserves (line 9) plus excess difference between current vault cash and the amount applied to satisfy current reserve reserves (line 16). requirements. Since February 1984, currency and vault cash figures have been measured over 7. To adjust required reserves for discontinuities that are due to regulatory changes in the computation periods ending on Mondays. reserve requirements, a multiplicative procedure is used to estimate what required reserves 12. Unadjusted total reserves (line 11) less unadjusted required reserves (line 14). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary and Credit Aggregates A13 1.21 MONEY STOCK MEASURES1 Billions of dollars, averages of daily figures 2002 2003 1999 2000 2001 2002 Dec. Dec. Dec. Dec. Dec. Jan.' Feb.' Mar. Seasonally adjusted Measures2 1 Ml 1,121.9 1,084.9 1,173.4 1,210.5 1,210.5 1,212.6 1,232.6 1,236.2 2 M2 4,648.0 4,926.9 5,440.6 5,796.6' 5,796.6' 5,827.3 5,883.5 5,899.0 3 M3 6,529.8r 7,093.3' 7,995.3' 8,517.5' 8,517.5' 8,515.0 8,568.8 8,580.5 Ml components 4 Currency3 517.5 531.0 581.4 626.7 626.7 630.1 635.3 639.2 5 Travelers checks4 8.3 8.0 7.8 7.5 7.5 7.6 7.6 7.5 6 Demand deposits5 352.2 306.7 325.6 296.4 296.4 295.6 305.6 304.0 7 Other checkable deposits6 244.0 239.2 258.8 279.9 279.9 279.3 284.1 285.4 Nontransaction components 8 In M27 3,526.0 3,842.0 4,267.1 4,586.1' 4,586.1' 4,614.7 4,650.9 4,662.8 9 In M3 only8 1,881.8r 2,166.4' 2,554.8r 2,720.9' 2,720.9' 2,687.7 2,685.3 2,681.5 Commercial banks 10 Savings deposits, including MMDAs 1,288.8 1,422.3 1,734.5 2,047.5' 2,047.5' 2,079.4 2,107.1 2,115.0 11 Small time deposits9 634.7 698.8 634.2 583.6 583.6 580.2 576.7 573.3 12 Large time deposits10'" 650.2 717.4 670.8 683.3' 683.3' 691.7 700.0 695.2 Thrift institutions 13 Savings deposits, including MMDAs 449.6 451.7 569.0 710.3 710.3 723.1 739.6 751.4 14 Small time deposits9 320.3 344.4 338.7 300.4' 300.4' 299.2 297.6 297.1 15 Large time deposits10 91.0 102.9 114.9 116.7 116.7 118.0 118.1 117.4 Money market mutual funds 16 Retail 832.7 924.8 990.7 944.3 944.3 932.8 929.9 925.9 17 Institution-only 634.4 788.2 1,189.7 1,233.0 1,233.0 1,196.7 1,176.7 1,164.2 Repurchase agreements and eurodollars 18 Repurchase agreements12 335.7 363.5 375.0 468.6 468.6 459.3 472.3 488.5 19 Eurodollars12 170.5r 194.3' 204.3' 219.2' 219.2' 222.0 218.2 216.1 Not seasonally adjusted Measures2 20 Ml 1,148.3 1,112.3 1,203.5 1,240.4 1,240.4 1,219.7 1,218.4 1,237.6 21 M2 4,675.0 4,962.3 5,483.5 5,845.9' 5,845.9' 5,836.4 5,865.8 5,931.8 22 M3 6,572.4' 7,147.8' s^.a 8,595.0' 8,595.0' 8,559.1 8,598.6 8,642.2 Ml components 23 Currency3 521.5 535.2 584.9 629.9 629.9 628.0 634.3 638.9 24 Travelers checks4 8.4 8.1 7.9 7.7 7.7 7.7 7.7 7.7 25 Demand deposits5 371.8 326.5 347.6 316.8 316.8 300.3 297.1 302.9 26 Other checkable deposits6 246.6 242.5 263.2 286.0 286.0 283.7 279.3 288.2 Nontransaction components 27 In M27 3,526.7 3,849.9 4,280.0 4,605.5' 4,605.5' 4,616.6 4,647.3 4,694.2 28 In M3 only8 1,897.4' 2,185.6' 2,583.5' 2,749.1' 2,749.1' 2,722.7 2,732.8 2,710.4 Commercial banks 29 Savings deposits, including MMDAs 1,288.8 1,426.9 1,742.3 2,060.0 2,060.0 2,074.8 2,096.2 2,126.1 30 Small time deposits9 635.7 700.0 635.2 584.3 584.3 580.4 576.6 572.5 31 Large time deposits1011 651.7 717.6 669.7 681.6 681.6 686.0 696.1 693.1 Thrift institutions 32 Savings deposits, including MMDAs 449.6 453.1 571.5 714.7 714.7 721.5 735.7 755.4 33 Small time deposits9 320.8 345.0 339.2 300.7 300.7 299.3 297.5 296.7 34 Large time deposits10 91.2 103.0 114.7 116.4 116.4 117.0 117.5 117.1 Money market mutual funds 35 Retail 832.0 925.0 991.8 945.8 945.8 940.8 941.3 943.4 36 Institution-only 648.2 805.6 1,217.7 1,260.8 1,260.8 1,234.0 1,214.1 1,185.9 Repurchase agreements and eurodollars 3'/ Repurchase agreements'2 334.7 364.2 376.5 470.4 470.4 462.8 483.4 494.5 38 Eurodollars12 171.7' 195.2' 204.9' 219.8' 219.8' 222.9 221.6 219.9 Footnotes appear on following page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A14 Domestic Nonfinancial Statistics • June 2003 NOTES TO TABLE 1.21 1. Latest monthly and weekly figures are available from the Board's H.6 (508) weekly ory institutions, the U.S. government, money market funds, and foreign banks and official statistical release. Historical data starting in 1959 are available from the Money and Reserves institutions. Seasonally adjusted M3 is calculated by summing large time deposits, institu- Projections Section, Division of Monetary Affairs, Board of Governors of the Federal tional money fund balances, RP liabilities, and eurodollars, each seasonally adjusted sepa- Reserve System, Washington, DC 20551. rately, and adding this result to seasonally adjusted M2. 2. Composition of the money stock measures is as follows: 3. Currency outside the U.S. Treasury, Federal Reserve Banks, and vaults of depository Ml: (1) currency outside the U.S. Treasury, Federal Reserve Banks, and the vaults of institutions. depository institutions, (2) travelers checks of nonbank issuers, (3) demand deposits at all 4. Outstanding amount of U.S. dollar-denominated travelers checks of nonbank issuers. commercial banks other than those owed to depository institutions, the U.S. government, and Travelers checks issued by depository institutions are included in demand deposits. foreign banks and official institutions, less cash items in the process of collection and Federal 5. Demand deposits at commercial banks and foreign-related institutions other than those Reserve float, and (4) other checkable deposits (OCDs), consisting of negotiable order of owed to depository institutions, the U.S. government, and foreign banks and official instituwithdrawal (NOW) and automatic transfer service (ATS) accounts at depository institutions, tions, less cash items in the process of collection and Federal Reserve float. credit union share draft accounts, and demand deposits at thrift institutions. Seasonally 6. Consists of NOW and ATS account balances at all depository institutions, credit union adjusted Ml is computed by summing currency, travelers checks, demand deposits, and share draft account balances, and demand deposits at thrift institutions. OCDs, each seasonally adjusted separately. 7. Sum of (1) savings deposits (including MMDAs), (2) small time deposits, and (3) retail M2: Ml plus (1) savings deposits (including MMDAs), (2) small-denomination time money fund balances. deposits (time deposits—including retail RPs—in amounts of less than $100,000), and (3) 8. Sum of (1) large time deposits, (2) institutional money fund balances, (3) RP liabilities balances in retail money market mutual funds. Excludes individual retirement accounts (overnight and term) issued by depository institutions, and (4) eurodollars (overnight and (IRAs) and Keogh balances at depository institutions and money market funds. Seasonally term) of U.S. addressees. adjusted M2 is calculated by summing savings deposits, small-denomination time deposits, 9. Small time deposits—including retail RPs—are those issued in amounts of less than and retail money fund balances, each seasonally adjusted separately, and adding this result to $100,000. All IRAs and Keogh accounts at commercial banks and thrift institutions are seasonally adjusted M1. subtracted from small time deposits. M3: M2 plus (1) large-denomination time deposits (in amounts of $100,000 or more) 10. Large time deposits are those issued in amounts of $100,000 or more, excluding those issued by all depository institutions, (2) balances in institutional money funds, (3) RP booked at international banking facilities. liabilities (overnight and term) issued by all depository institutions, and (4) eurodollars 11. Large time deposits at commercial banks less those held by money market funds, (overnight and term) held by U.S. residents at foreign branches of U.S. banks worldwide and depository institutions, the U.S. government, and foreign banks and official institutions. at all banking offices in the United Kingdom and Canada. Excludes amounts held by deposit- 12. Includes both overnight and term. 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 2002 2002 2003 2003 Mar.' Sept.' Oct.' Nov.' Dec.' Jan.' Feb.' Mar. Mar. 5 Mar. 12 Mar. 19 Mar. 26 Seasonally adjusted Assets 1 Bank credit 5,418.5 5,729.3 5,759.4 5,838.2 5,894.8 5,889.3 5,964.3 5,994.3 6,011.1 6,023.5 5,974.8 5,972.9 7 Securities in bank credit 1,479.4 1,639.5 1,637.3 1,679.4 1,708.7 1,702.1 1,744.4 1,755.0 1,780.3 1,773.2 1,734.8 1,740.8 3 U.S. government securities 846.1 959.4 973.8 1,004.3 1,020.0 1,021.5 1,047.3 1,057.2 1,066.6 1,056.4 1,047.5 1,054.1 4 Other securities 633.3 680.1 663.5 675.2 688.7 680.6 697.1 697.8 713.6 716.7 687.3 686.7 5 Loans and leases in bank credit2 .... 3,939.1 4,089.8 4,122.2 4,158.8 4,186.0 4,187.2 4,219.9 4,239.4 4,230.8 4,250.3 4,240.0 4,232.0 6 Commercial and industrial 1,017.1 973.8 969.1 968.2 966.2 961.0 953.2 946.4 949.1 949.0 945.6 944.6 7 Real estate 1,790.9 1,939.5 1,972.8 2,007.7 2,029.7 2,046.1 2,076.6 2,091.7 2,090.6 2,105.7 2,086.6 2,078.8 8 Revolving home equity 167.3 201.2 205.1 209.2 213.8 217.7 222.3 229.4 226.2 228.1 230.1 230.4 9 Other 1,623.6 1,738.4 1,767.7 1,798.6 1,815.9 1,828.4 1,854.4 1,862.3 1,864.4 1,877.6 1,856.5 1,848.4 10 Consumer 560.7 583.1 584.9 585.7 588.3 592.8 593.9 590.9 590.7 588.3 593.8 591.6 11 Security3 161.7 180.9 183.0 185.8 189.5 176.5 185.9 202.0 192.9 196.1 203.3 211.0 1? Other loans and leases 408.7 412.4 412.3 411.3 412.4 410.9 410.3 408.3 407.5 411.3 410.8 406.0 n Interbank loans 269.7 317.7 328.1 325.5 328.4 307.7 305.7 316.0 311.9 315.2 317.7 316.2 14 Cash assets4 299.9 318.1 317.8 315.4 316.9 312.9 316.0 322.1 325.2 312.9 330.3 318.2 15 Other assets5 463.9 496.6 507.5 509.9 507.5 508.8 534.9 528.3 529.3 539.8 520.6 525.4 16 Total assets6 6,376.6 6,786.0 6,836.5 6,912.2 6,971.0 6,941.3 7,043.4 7,082.8 7,099.3 7,113.3 7,065.6 7,054.8 Liabilities 17 Deposits 4,293.0 4,478.4 4,486.7 4,509.3 4,488.3 4,510.5 4,537.4 4,586.4 4,584.8 4,580.5 4,582.7 4,575.9 18 Transaction 623.5 582.7 609.7 605.9 611.3 607.6 612.9 618.2 604.2 597.1 628.5 653.5 19 Nontransaction 3,669.5 3,895.7 3,876.9 3,903.4 3,877.1 3,902.9 3,924.5 3,968.2 3,980.6 3,983.4 3,954.1 3,922.4 70 Large time 1,022.2 1,044.2 1,024.8 1,006.0 979.7 984.0 999.6 1,005.5 1,007.9 1,014.1 1,007.5 997.6 71 Other 2,647.2 2,851.4 2,852.1 2,897.4 2,897.4 2,918.9 2,925.0 2,962.7 2,972.7 2,969.3 2,946.6 2,924.8 7.2 Borrowings 1,206.2 1,322.8 1,332.0 1,366.1 1,396.9 1,333.6 1,369.2 1,395.3 1,389.1 1,413.5 1,385.4 1,398.0 73 From banks in the U.S 383.0 415.9 414.9 421.9 417.5 380.5 386.9 395.6 394.4 410.6 389.3 385.7 74 From others 823.2 906.9 917.1 944.2 979.5 953.1 982.4 999.6 994.7 1,002.9 996.2 1,012.4 75 Net due to related foreign offices 102.3 99.1 117.5 122.9 152.0 156.7 145.8 139.7 126.2 149.4 150.8 125.5 26 Other liabilities 316.2 432.7 427.8 431.4 441.6 443.3 452.8 444.2 470.8 451.3 432.2 432.8 27 Total liabilities 5,917.7 6,332.9 6,364.0 6,429.7 6,478.9 6,444.0 6,505.3 6,565.5 6,570.9 6,594.7 6,551.0 6,532.3 28 Residual (assets less liabilities)7 458.9 453.1 472.5 482.5 492.1 497.3 538.0 517.3 528.5 518.6 514.6 522.5 Not seasonally adjusted Assets 79 Bank credit 5,409.2 5,725.9 5,761.3 5,853.6 5,928.8 5,906.6 5,967.9 5,982.7 6,018.3 6,018.2 5,962.2 5,945.9 30 Securities in bank credit 1,483.4 1,638.3 1,635.1 1,682.7 1,715.3 1,712.5 1,753.5 1,760.0 1,791.6 1,783.9 1,737.3 1,739.7 31 U.S. government securities 850.1 959.3 969.8 1,006.0 1,024.3 1,026.3 1,053.6 1,062.1 1,076.2 1,063.7 1,051.1 1,055.2 37 Other securities 633.3 679.0 665.3 676.7 691.1 686.2 699.9 697.9 715.4 720.2 686.2 684.4 33 Loans and leases in bank credit2 .... 3,925.9 4,087.6 4,126.1 4,170.8 4,213.4 4,194.1 4,214.3 4,222.7 4,226.6 4,234.3 4,224.9 4,206.2 34 Commercial and industrial 1,018.7 972.2 969.5 968.2 964.9 955.1 951.2 947.8 950.3 947.7 948.2 945.8 35 Real estate 1,783.5 1,941.2 1,974.4 2,012.3 2,034.3 2,046.5 2,072.4 2,082.7 2,083.8 2,098.5 2,076.5 2,067.4 36 Revolving home equity 165.9 201.8 205.6 209.0 213.4 217.1 222.6 227.4 225.5 226.4 227.7 227.7 37 Other 1,617.6 1,739.3 1,768.8 1,803.2 1,820.9 1,829.4 1,849.8 1,855.4 1,858.3 1,872.1 1,848.7 1,839.6 38 Consumer 558.1 582.1 585.3 588.1 597.1 600.5 597.1 588.6 590.3 586.5 591.7 588.7 39 Credit cards and related plans . . 219.9 230.9 232.0 231.6 238.6 234.8 228.0 223.7 225.8 222.2 226.9 223.4 40 Other 338.3 351.2 353.2 356.5 358.6 365.6 369.1 364.9 364.5 364.4 364.8 365.3 41 Security3 158.4 179.4 185.2 190.2 200.1 182.8 187.6 197.2 195.4 193.9 200.1 201.8 47 Other loans and leases 407.1 412.8 411.7 412.1 417.0 409.3 405.9 406.4 406.8 407.7 408.4 402.5 43 Interbank loans 274.7 310.1 320.9 330.6 335.4 304.5 302.9 322.5 324.2 322.2 321.6 311.8 44 Cash assets4 289.8 314.3 320.9 325.2 339.1 328.8 316.5 311.4 316.7 302.0 317.8 300.3 45 Other assets5 463.2 500.1 507.4 513.4 512.4 512.6 532.5 527.6 531.7 538.7 520.3 519.0 46 Total assets6 6,361.3 6,774.7 6,834.7 6,946.1 7,039.1 6,975.3 7,041.9 7,065.9 7,112.2 7,102.6 7,043.8 6,999.1 Liabilities 47 Deposits 4,299.5 4,441.7 4,470.1 4,524.3 4,539.1 4,533.8 4,558.3 4,593.6 4,614.5 4,593.0 4,577.8 4,553.0 48 Transaction 615.0 577.8 606.8 613.5 644.1 621.6 605.2 609.9 599.4 587.4 616.3 633.6 49 Nontransaction 3,684.5 3,863.9 3,863.3 3,910.8 3,895.0 3,912.2 3,953.1 3,983.7 4,015.0 4,005.6 3,961.5 3,919.4 50 Large time 1,025.7 1,023.7 1,014.0 1,009.8 992.4 1,000.6 1,010.2 1,008.2 1,013.4 1,016.8 1,008.3 1,000.2 51 Other 2,658.8 2,840.2 2,849.3 2,900.9 2,902.6 2,911.6 2,942.9 2,975.5 3,001.6 2,988.9 2,953.2 2,919.2 52 Borrowings 1,202.9 1,320.5 1,334.6 1,367.4 1,396.1 1,346.7 1,371.4 1,391.6 1,391.1 1,408.7 1,388.3 1,388.6 53 From banks in the U.S 386.2 409.1 413.4 418.6 419.2 385.1 390.4 399.1 399.5 413.9 393.7 387.2 54 From others 816.7 911.4 921.1 948.8 976.8 961.6 981.1 992.6 991.6 994.8 994.6 1,001.3 55 Net due to related foreign offices 101.7 101.4 119.5 126.8 158.2 160.7 151.3 137.7 126.5 147.2 147.2 126.6 56 Other liabilities 314.1 435.0 431.5 437.5 448.6 447.0 459.1 440.4 470.9 448.2 426.6 431.1 57 Total liabilities 5,918.1 6,298.6 6,355.6 6,456.0 6,541.9 6,488.2 6,540.2 6,563.3 6,602.9 6,597.2 6,539.9 6,499.2 58 Residual (assets less liabilities)7 443.2 476.0 479.1 490.1 497.2 487.1 501.6 502.6 509.3 505.5 503.9 499.9 Footnotes appear on p. A21. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A16 Domestic Financial Statistics • June 2003 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 2002 2002 2003 2003 Mar.1" Sept.r Oct.' Nov/ Dec.' Jan.' Feb.' Mar. Mar. 5 Mar. 12 Mar. 19 Mar. 26 Seasonally adjusted Assets 1 Bank credit 4,827.4 5,109.4 5,144.9 5,218.0 5,258.6 5,261.7 5,323.8 5,335.9 5,352.3 5,360.3 5,320.1 5,316.5 2 Securities in bank credit 1,250.9 1,391.9 1,392.4 1,431.5 1,446.9 1,439.3 1,471.5 1,477.9 1,497.8 1,489.8 1,461.0 1,469.7 3 U.S. government securities 775.2 872.4 884.8 910.8 918.1 918.8 939.7 945.6 955.7 945.2 937.1 943.5 4 Other securities 475.6 519.6 507.6 520.7 528.8 520.5 531.8 532.3 542.1 544.6 523.9 526.2 5 Loans and leases in bank credit2 .... 3,576.6 3,717.5 3,752.5 3,786.5 3,811.7 3,822.4 3,852.3 3,857.9 3,854.6 3,870.5 3,859.1 3,846.8 6 Commercial and industrial 821.7 788.8 788.0 789.2 787.8 784.6 781.0 777.4 778.2 778.2 777.4 776.5 7 Real estate 1,772.9 1,920.5 1,953.2 1,987.8 2,010.2 2,027.2 2,058.6 2,073.9 2,072.6 2,087.6 2,068.7 2,060.8 8 Revolving home equity 167.3 201.2 205.1 209.2 213.8 217.7 222.3 229.4 226.2 228.1 230.1 230.4 9 Other 1,605.5 1,719.3 1,748.1 1,778.6 1,796.4 1,809.5 1,836.3 1,844.5 1,846.3 1,859.5 1,838.6 1,830.4 10 Consumer 560.7 583.1 584.9 585.7 588.3 592.8 593.9 590.9 590.7 588.3 593.8 591.6 11 Security3 81.8 85.7 85.6 81.1 79.4 71.4 73.0 71.9 71.1 69.7 73.5 75.3 12 Other loans and leases 339.6 339.4 340.8 342.7 346.0 346.5 345.9 343.8 342.0 346.7 345.7 342.6 13 Interbank loans 249.0 296.5 303.6 300.0 298.3 279.0 276.8 285.5 281.2 284.0 285.3 285.6 14 Cash assets4 255.5 271.5 272.2 273.0 272.3 272.9 277.7 279.7 286.8 272.3 286.0 273.7 15 Other assets5 439.0 467.6 473.7 475.3 471.6 468.8 493.3 490.1 488.6 501.0 484.2 489.3 16 Total assets6 5,695.9 6,069.8 6,118.5 6,190.0 6,224.7 6,205.4 6,294.4 6,313.6 6,331.2 6,339.9 6,298.2 6,287.5 Liabilities 17 Deposits 3,810.6 3,986.1 4,015.2 4,056.7 4,062.7 4,083.7 4,094.1 4,137.2 4,130.9 4,125.4 4,122.7 4,137.6 18 Transaction 613.4 572.6 600.1 596.7 602.1 598.0 603.2 607.6 593.2 586.3 618.0 643.2 19 Nontransaction 3,197.3 3,413.4 3,415.1 3,460.0 3,460.6 3,485.7 3,490.9 3,529.6 3,537.8 3,539.1 3,504.8 3,494.4 20 Large time 552.0 568.3 571.2 571.6 571.0 582.2 587.8 587.5 588.9 591.1 583.2 584.8 21 Other 2,645.3 2,845.1 2,843.9 2,888.4 2,889.6 2,903.5 2,903.1 2,942.0 2,948.9 2,947.9 2,921.6 2,909.6 22 Borrowings 1,018.7 1,097.7 1,099.4 1,114.9 1,119.1 1,061.9 1,092.4 1,095.8 1,095.1 1,115.8 1,093.6 1,086.5 23 From banks in the U.S 362.2 393.3 391.9 396.7 387.6 349.5 355.5 361.3 357.1 373.6 357.5 352.7 24 From others 656.6 704.4 707.4 718.1 731.5 712.4 737.0 734.5 738.0 742.2 736.1 733.8 25 Net due to related foreign offices 174.8 182.8 189.1 196.3 211.2 226.6 224.5 225.3 212.2 236.0 235.1 219.8 26 Other liabilities 242.8 338.9 328.1 332.1 339.5 344.4 351.7 348.9 366.5 349.1 340.4 342.5 27 Total liabilities 5,246.9 5,605.5 5,631.8 5,700.0 5,732.5 5,716.7 5,762.7 5,807.2 5,804.8 5,826.3 5,791.8 5,786.4 28 Residual (assets less liabilities)7 449.0 464.3 486.7 490.0 492.2 488.7 531.8 506.4 526.4 513.6 506.5 501.1 Not seasonally adjusted Assets 29 Bank credit 4,818.3 5,109.6 5,147.2 5,229.8 5,282.6 5,271.1 5,322.9 5,326.4 5,357.3 5,356.5 5,307.9 5,293.8 30 Securities in bank credit 1,254.8 1,390.8 1,390.2 1,434.8 1,453.5 1,449.7 1,480.6 1,482.9 1,509.1 1,500.6 1,463.5 1,468.6 31 U.S. government securities 779.2 872.2 880.8 912.5 922.3 923.6 946.0 950.6 965.3 952.5 940.7 944.6 32 Other securities 475.6 518.6 509.4 522.3 531.2 526.1 534.6 532.3 543.9 548.0 522.8 524.0 33 Loans and leases in bank credit2 .... 3,563.4 3.718.9 3,757.0 3,795.0 3,829.1 3,821.4 3,842.2 3,843.5 3,848.2 3,855.9 3,844.4 3,825.2 34 Commercial and industrial 821.5 787.3 788.3 787.9 785.1 778.6 777.5 777.2 777.5 775.8 778.0 776.3 35 Real estate 1,765.5 1,922.1 1,954.9 1,992.3 2,014.8 2,027.6 2,054.4 2,064.9 2,065.8 2,080.4 2,058.6 2,049.4 36 Revolving home equity 165.9 201.8 205.6 209.0 213.4 217.1 222.6 227.4 225.5 226.4 227.7 227.7 37 Other 1,599.6 1.720.3 1,749.3 1,783.3 1,801.4 1,810.5 1,831.8 1,837.6 1,840.3 1,854.0 1,830.9 1,821.6 38 Consumer 558.1 582.1 585.3 588.1 597.1 600.5 597.1 588.6 590.3 586.5 591.7 588.7 39 Credit cards and related plans .. 219.9 230.9 232.0 231.6 238.6 234.8 228.0 223.7 225.8 222.2 226.9 223.4 40 Other 338.3 351.2 353.2 356.5 358.6 365.6 369.1 364.9 364.5 364.4 364.8 365.3 41 Security3 81.3 87.1 87.8 83.4 83.4 70.6 71.8 71.6 74.3 70.7 73.6 72.7 42 Other loans and leases 337.0 340.3 340.8 343.3 348.7 344.2 341.4 341.0 340.3 342.5 342.4 338.1 43 Interbank loans 254.1 288.9 296.4 305.0 305.4 275.8 274.0 291.9 293.4 291.0 289.2 281.2 44 Cash assets4 246.6 268.0 274.3 280.4 291.3 285.8 277.2 270.1 278.7 262.5 275.0 257.1 45 Other assets5 437.7 471.1 474.1 478.9 475.4 471.3 490.2 488.5 489.6 498.1 483.1 482.6 46 Total assets6 5,681.3 6,062.3 6,116.7 6,218.0 6,278.6 6,227.2 6,286.8 6,299.1 6,340.8 6,330.0 6,277.4 6,237.1 Liabilities 47 Deposits 3,812.6 3,967.6 4,011.0 4,071.6 4,102.6 4,090.9 4,104.8 4,140.3 4,156.8 4,135.6 4,115.7 4,108.0 48 Transaction 605.2 567.5 596.9 604.0 634.1 611.8 595.5 599.6 588.7 577.0 606.1 623.6 49 Nontransaction 3,207.4 3,400.1 3,414.0 3,467.6 3,468.5 3,479.1 3,509.3 3,540.7 3,568.1 3,558.5 3,509.6 3,484.4 50 Large time 550.6 565.9 572.7 575.7 573.8 583.5 588.8 586.0 590.6 591.1 581.6 580.7 51 Other 2,656.9 2,834.1 2,841.4 2,892.0 2,894.7 2,895.6 2,920.5 2,954.6 2,977.6 2,967.4 2,928.0 2,903.7 52 Borrowings 1,015.4 1,095.4 1,101.9 1,116.2 1,118.2 1,075.0 1,094.6 1,092.2 1,097.1 1,111.0 1,096.5 1,077.0 53 From banks in the U.S 365.4 386.5 390.4 393.5 389.3 354.0 359.0 364.7 362.2 377.0 361.9 354.3 54 From others 650.0 708.9 711.5 722.7 728.9 721.0 735.6 727.5 734.8 734.0 734.5 722.8 55 Net due to related foreign offices 171.3 183.6 192.5 201.5 215.6 228.1 228.8 221.0 211.9 232.9 228.7 215.9 56 Other liabilities 239.4 340.2 332.6 339.1 345.3 346.4 357.2 343.6 366.1 345.4 332.9 337.4 57 Total liabilities 5,238.7 5,586.9 5,638.1 5,728.4 5,781.8 5,740.4 5,785.4 5,797.1 5,831.9 5,824.8 5,773.8 5,738.3 58 Residual (assets less liabilities)7 442.7 475.4 478.6 489.6 496.8 486.7 501.4 502.0 508.9 505.2 503.7 498.8 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 2002 2002 2003 2003 Mar.r Sept.' Oct.' Nov.' Dec.' Jan.' Feb.' Mar. Mar. 5 Mar. 12 Mar. 19 Mar. 26 Seasonally adjusted Assets 1 Bank credit 2,624.7 2,769.7 2,778.5 2,829.2 2,858.2 2,857.2 2,904.0 2,901.2 2,925.7 2,932.9 2,885.1 2,877.1 ? Securities in bank credit 633.7 744.3 737.5 770.1 779.5 773.8 804.9 802.4 824.8 819.8 787.1 791.0 U.S. government securities 373.9 431.5 436.2 455.4 457.7 460.8 479.5 475.9 490.3 480.2 468.6 471.5 4 Trading account 32.9 42.4 37.7 47.9 44.5 41.5 54.8 42.1 53.3 46.7 37.1 37.5 5 Investment account 340.9 389.1 398.5 407.5 413.1 419.2 424.7 433.8 437.0 433.6 431.6 434.0 6 Other securities 259.8 312.8 301.3 314.7 321.8 313.0 325.3 326.4 334.5 339.5 318.5 319.5 7 Trading account 122.2 171.3 153.8 161.0 164.9 159.7 172.2 171.3 180.5 185.2 162.9 164.1 8 Investment account 137.6 141.5 147.5 153.7 157.0 153.3 153.1 155.1 154.0 154.3 155.6 155.4 9 State and local government .. 27.6 28.4 28.8 29.3 29.5 29.4 29.6 30.1 29.7 29.7 30.2 30.4 10 Other 110.0 113.1 118.7 124.4 127.5 123.9 123.5 125.0 124.3 124.6 125.4 125.1 11 Loans and leases in bank credit2 .... 1,991.0 2,025.4 2,041.0 2,059.1 2,078.7 2,083.4 2,099.2 2,098.8 2,100.8 2,113.2 2,098.0 2,086.0 17 Commercial and industrial 527.3 487.8 485.4 484.0 481.9 479.2 474.2 470.4 471.0 471.8 470.4 469.7 n Bankers acceptances .0 .0 .0 .0 .0 .0 .0 .0 n.a. n.a. n.a. n.a. 14 Other 527.3 487.8 485.4 484.0 481.9 479.2 474.2 470.4 471.0 471.8 470.4 469.7 15 Real estate 854.9 926.2 944.6 969.2 989.6 1,005.6 1,027.2 1,036.6 1,038.9 1,049.3 1,031.2 1,023.9 16 Revolving home equity 106.3 127.5 129.9 132.8 136.8 139.9 142.3 147.8 145.5 147.0 148.4 148.2 17 Other 748.6 798.6 814.7 836.4 852.8 865.7 884.9 888.8 893.4 902.3 882.8 875.7 18 Consumer 291.5 297.5 297.9 296.3 296.4 296.6 294.5 291.0 292.1 290.2 292.0 290.7 19 Security3 74.4 77.8 77.3 72.9 71.1 62.9 64.4 63.5 62.7 61.2 65.1 66.6 20 Federal funds sold to and repurchase agreements with broker-dealers 61.8 67.8 67.0 62.1 60.8 52.3 53.7 52.1 52.4 49.9 5533..22 5544..55 ?1 Other 12.5 9.9 10.3 10.8 10.4 10.6 10.7 11.4 10.3 11.3 11.8 12.1 22 State and local government 13.4 13.1 13.0 12.1 11.8 12.0 12.2 12.4 12.4 12.3 12.4 12.5 23 Agricultural 9.4 8.2 8.1 8.1 8.2 8.1 7.8 7.8 7.8 7.8 7.8 7.8 24 Federal funds sold to and repurchase agreements with others 21.6 19.9 19.3 18.7 22.6 23.0 23.4 23.0 21.6 24.7 25.7 2211..22 75 All other loans 67.2 68.5 70.5 73.8 74.4 75.4 75.0 74.0 73.7 75.4 73.4 73.8 ?6 Lease-financing receivables 131.3 126.5 124.9 124.0 122.7 120.8 120.5 120.1 120.6 120.4 120.0 119.9 71 Interbank loans 153.1 184.0 184.1 181.6 179.4 153.5 150.3 159.1 157.6 157.8 159.1 152.6 28 Federal funds sold to and repurchase agreements with commercial banks 81.6 90.6 85.6 88.5 86.2 85.7 81.1 89.5 88.7 8899..00 8888..11 8811..66 29 Other 71.5 93.3 98.5 93.1 93.2 67.8 69.2 69.7 68.9 68.8 71.0 71.0 30 Cash assets4 144.0 145.7 144.6 146.0 147.1 146.8 148.2 148.5 156.2 143.3 154.8 141.7 31 Other assets5 298.5 322.7 333.2 332.9 328.8 324.5 345.1 339.3 337.2 346.3 337.3 343.3 32 Total assets6 3,175.6 3,378.4 3,396.5 3,445.5 3,469.7 3,437.5 3,503.0 3,503.3 3,531.4 3,535.4 3,491.7 3,469.8 Liabilities 33 Deposits 1,827.1 1,893.2 1,910.2 1,937.7 1,947.5 1,960.8 1,961.3 1,979.9 1,981.3 1,975.0 1,970.6 1,974.0 34 Transaction 311.1 270.9 288.7 284.5 287.6 285.0 287.2 287.5 281.7 275.0 296.1 304.6 35 Nontransaction 1,516.1 1,622.3 1,621.5 1,653.2 1,659.9 1,675.8 1,674.2 1,692.5 1,699.6 1,700.0 1,674.5 1,669.4 36 Large time 252.1 266.9 267.1 265.7 262.6 274.5 277.2 272.6 275.1 275.9 269.0 269.4 37 Other 1,264.0 1,355.4 1,354.4 1,387.5 1,397.2 1,401.3 1,397.0 1,419.9 1,424.4 1,424.1 1,405.5 1,400.0 38 Borrowings 697.6 730.7 727.6 740.9 729.7 654.8 681.9 688.0 694.4 706.3 681.7 679.2 39 From banks in the U.S 249.0 263.5 262.7 268.8 248.9 193.5 196.1 204.5 202.8 214.5 200.2 195.7 40 From others 448.6 467.2 464.9 472.1 480.9 461.3 485.7 483.5 491.6 491.7 481.5 483.5 41 Net due to related foreign offices 165.7 174.2 176.8 185.0 198.8 211.4 211.5 213.8 200.9 225.2 224.6 207.8 42 Other liabilities 181.4 271.3 261.0 264.9 274.5 273.7 278.8 274.9 291.9 275.1 266.8 268.0 43 Total liabilities 2,871.8 3,069.3 3,075.5 3,128.5 3,150.5 3,100.7 3,133.5 3,156.7 3,168.5 3,181.7 3,143.7 3,129.0 44 Residual (assets less liabilities)7 303.7 309.1 321.0 316.9 319.2 336.8 369.5 346.6 363.0 353.8 348.1 340.8 Footnotes appear on p. A21. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A18 Domestic Nonfinancial Statistics • June 2003 1.26 COMMERCIAL BANKS IN THE UNITED STATES Assets and Liabilities1—Continued C. Large domestically chartered commercial banks—Continued Billions of dollars Monthly averages Wednesday figures AAAccccccooouuunnnttt 2002 2002 2003 2003 Mar.r Sept.1" Oct.' Nov.r Dec/ Jan.' Feb.' Mar. Mar. 5 Mar. 12 Mar. 19 Mar. 26 Not seasonally adjusted Assets 45 Bank credit 2,619.2 2,767.5 2,778.4 2,837.5 2,870.7 2,864.6 2,906.2 2,895.0 2,933.9 2,931.8 2,877.0 2,858.2 46 Securities in bank credit 635.4 743.0 737.5 774.5 784.6 782.4 813.2 804.7 835.3 827.8 786.9 786.2 47 U.S. government securities 375.6 431.3 434.4 458.3 460.4 463.8 485.0 478.2 499.0 484.8 469.5 468.9 48 Trading account 33.1 42.4 37.6 48.2 44.8 41.8 55.5 42.4 54.3 47.1 37.1 37.3 49 Investment account 342.5 388.9 396.9 410.1 415.6 422.0 429.6 435.8 444.8 437.7 432.4 431.6 50 Mortgage-backed securities . 263.5 308.3 313.2 324.8 317.2 323.3 329.5 332.8 340.7 332.4 329.9 328.2 51 Other 78.9 80.5 83.7 85.3 98.4 98.7 100.1 103.0 104.1 105.3 102.5 103.4 52 One year or less 20.2 20.2 22.1 23.5 24.5 21.6 23.1 24.6 25.1 25.1 25.0 24.8 53 One to five years 46.2 47.2 51.0 48.0 57.4 59.3 58.1 57.9 56.1 56.9 57.3 60.6 54 More than five years .... 12.5 13.1 10.6 13.8 16.6 17.8 18.9 20.5 22.9 23.3 20.1 18.1 55 Other securities 259.8 311.7 303.0 316.2 324.2 318.6 328.2 326.5 336.3 343.0 317.4 317.2 56 Trading account 122.2 170.7 154.7 161.8 166.1 162.5 173.7 171.4 181.5 187.1 162.3 162.9 57 Investment account 137.6 141.0 148.4 154.5 158.1 156.0 154.4 155.1 154.8 155.9 155.1 154.3 58 State and local government . 27.6 28.4 29.0 29.4 29.7 30.0 29.8 30.1 29.9 30.0 30.1 30.1 59 Other 110.0 112.7 119.4 125.0 128.4 126.1 124.6 125.0 124.9 125.9 124.9 124.2 60 Loans and leases in bank credit2 . . . 1,983.9 2,024.5 2,040.9 2,063.0 2,086.1 2,082.2 2,093.0 2,090.4 2,098.6 2,104.0 2,090.1 2,072.0 61 Commercial and industrial 527.2 487.9 485.9 484.2 479.3 474.7 472.2 470.4 471.2 470.2 470.9 469.1 62 Bankers acceptances .0 .0 .0 .0 .0 .0 .0 .0 n.a. n.a. n.a. n.a. 63 Other 527.2 487.9 485.9 484.2 479.3 474.7 472.2 470.4 471.2 470.2 470.9 469.1 64 Real estate 849.4 927.2 945.2 971.9 990.9 1,004.5 1,023.0 1,029.7 1,033.3 1,043.5 1,024.0 1,015.2 65 Revolving home equity 105.1 127.9 130.2 132.5 135.9 139.0 142.6 146.1 144.8 145.5 146.4 146.1 66 Other 430.3 483.9 496.4 520.5 536.5 546.2 561.0 564.1 568.7 578.0 558.1 549.1 67 Commercial 314.0 315.4 318.6 318.9 318.4 319.4 319.4 319.6 319.7 320.1 319.5 320.0 68 Consumer 291.9 294.6 294.6 294.9 298.9 301.4 297.7 291.6 293.9 290.9 292.6 290.9 69 Credit cards and related plans . 119.4 118.5 117.1 114.6 117.3 115.3 109.7 105.9 108.9 105.5 106.8 104.8 70 Other 172.6 176.1 177.5 180.3 181.6 186.1 188.0 185.8 185.0 185.4 185.8 186.1 71 Security3 73.6 79.1 79.6 74.9 75.0 62.4 63.3 62.9 65.4 61.9 65.1 64.1 72 Federal funds sold to and repurchase agreements with broker-dealers 61.2 69.1 69.0 63.8 64.1 51.9 52.8 51.6 54.6 50.5 53.2 52.5 73 Other 12.4 10.1 10.6 11.1 10.9 10.5 10.5 11.3 10.8 11.4 11.8 11.6 74 State and local government 13.4 13.1 13.0 12.1 11.8 12.0 12.2 12.4 12.4 12.3 12.4 12.5 75 Agricultural 9.3 8.2 8.0 8.0 8.1 8.1 7.7 7.7 7.7 7.7 7.7 7.7 76 Federal funds sold to and repurchase agreements with others 21.6 19.9 19.3 18.7 22.6 23.0 23.4 23.0 21.6 24.7 25.7 21.2 77 All other loans 65.1 69.6 70.8 74.7 76.4 73.5 71.7 71.8 71.6 71.5 71.1 71.0 78 Lease-financing receivables 132.1 124.8 124.3 123.5 123.0 122.6 121.9 120.9 121.6 121.2 120.7 120.4 79 Interbank loans 153.1 178.1 178.3 183.1 183.9 156.7 148.5 159.2 158.9 156.7 159.4 149.1 80 Federal funds sold to and repurchase agreements with commercial banks 81.6 87.8 83.0 89.2 88.4 87.5 80.2 89.5 89.4 88.3 88.3 79.7 81 Other 71.4 90.2 95.3 93.9 95.5 69.2 68.3 69.6 69.5 68.3 71.2 69.4 82 Cash assets4 139.1 142.7 146.2 149.1 158.7 155.6 148.2 143.5 150.2 137.9 150.1 132.7 83 Other assets5 297.2 326.3 333.5 336.5 332.6 326.9 342.0 337.7 338.2 343.4 336.2 336.6 84 Total assets6 3,163.5 3,370.8 3,393.1 3,462.3 3,502.1 3,459.4 3,499.9 3,490.3 3,535.6 3,524.4 3,477.8 3,431.7 Liabilities 85 Deposits 1,824.6 1,885.6 1,907.8 1,944.5 1,964.0 1,961.7 1,965.4 1,978.0 1,993.9 1,977.5 1,964.8 1,951.0 86 Transaction 306.4 266.5 285.7 288.3 308.0 293.8 282.8 283.1 277.8 268.9 290.5 293.7 87 Nontransaction 1,518.2 1,619.0 1,622.1 1,656.2 1,656.0 1,667.9 1,682.5 1,694.9 1,716.1 1,708.5 1,674.3 1,657.2 88 Large time 250.7 264.5 268.6 269.8 265.5 275.8 278.2 271.1 276.8 275.9 267.3 265.2 89 Other 1,267.5 1,354.5 1,353.4 1,386.5 1,390.5 1,392.1 1,404.4 1,423.8 1,439.3 1,432.7 1,407.0 1,392.0 90 Borrowings 694.2 728.4 730.1 742.3 728.9 667.9 684.0 684.4 696.4 701.5 684.6 669.7 91 From banks in the U.S 252.2 256.7 261.2 265.6 250.6 198.1 199.6 208.0 207.9 217.9 204.7 197.3 92 From nonbanks in the U.S 442.1 471.6 468.9 476.7 478.2 469.8 484.4 476.5 488.5 483.6 479.9 472.5 93 Net due to related foreign offices 162.2 175.0 180.2 190.2 203.2 212.9 215.8 209.5 200.6 222.1 218.2 203.9 94 Other liabilities 178.1 272.7 265.5 271.8 280.3 275.7 284.2 269.6 291.4 271.4 259.3 262.9 95 Total liabilities 2,859.1 3,061.6 3,083.6 3,148.9 3,176.4 3,118.2 3,149.4 3,141.6 3,182.4 3,172.5 3,127.0 3,087.5 96 Residual (assets less liabilities)7 304.4 309.2 309.5 313.4 325.8 341.3 350.5 348.7 353.3 351.9 350.8 344.2 Footnotes appear on p. A21. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banking Institutions—Assets and Liabilities A19 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 2002 2002 2003 2003 Mar.r Sept.' Oct.' Nov.' Dec.' Jan.' Feb.' Mar. Mar. 5 Mar. 12 Mar. 19 Mar. 26 Seasonally adjusted Assets 1 Bank credit 2,202.7 2,339.7 2,366.3 2,388.8 2,400.4 2,404.5 2,419.8 2,434.7 2,426.7 2,427.3 2,435.0 2,439.4 2 Securities in bank credit 617.2 647.6 654.9 661.4 667.4 665.5 666.6 675.6 673.0 670.0 673.9 678.7 3 U.S. government securities 401.4 440.8 448.5 455.4 460.4 458.0 460.2 469.7 465.3 465.0 468.5 472.0 4 Other securities 215.8 206.8 206.4 206.0 207.0 207.5 206.4 205.9 207.6 205.0 205.4 206.7 5 Loans and leases in bank credit2 .... 1,585.6 1,692.1 1,711.4 1,727.4 1,733.0 1,739.0 1,753.2 1,759.1 1,753.7 1,757.3 1,761.1 1,760.7 6 Commercial and industrial 294.4 301.0 302.6 305.2 305.9 305.4 306.7 307.0 307.2 306.4 307.0 306.7 7 Real estate 917.9 994.4 1,008.6 1,018.5 1,020.7 1,021.6 1,031.3 1,037.4 1,033.6 1,038.3 1,037.5 1,036.9 8 Revolving home equity 61.0 73.7 75.2 76.3 77.1 77.8 79.9 81.7 80.7 81.0 81.7 82.2 <3 Other 856.9 920.7 933.4 942.2 943.6 943.7 951.4 955.7 952.9 957.2 955.8 954.6 in Consumer 269.2 285.5 287.0 289.4 291.8 296.2 299.5 299.9 298.6 298.1 301.8 301.0 11 Security3 7.4 8.0 8.2 8.2 8.2 8.5 8.6 8.5 8.4 8.5 8.4 8.7 12 Other loans and leases 96.6 103.2 104.9 106.0 106.3 107.3 107.0 106.5 105.9 106.1 106.4 107.4 n Interbank loans 95.9 112.6 119.4 118.4 119.0 125.4 126.5 126.4 123.6 126.2 126.3 133.0 14 Cash assets4 111.5 125.8 127.6 127.1 125.3 126.1 129.5 131.1 130.6 129.0 131.2 132.0 15 Other assets5 140.5 144.8 140.5 142.4 142.8 144.4 148.2 150.8 151.4 154.7 146.9 146.0 16 Total assets6 2,520.4 2,691.3 2,722.0 2,744.5 2,755.0 2,768.0 2,791.4 2,810.3 2,799.7 2,804.5 2,806.5 2,817.7 Liabilities 17 Deposits 1,983.5 2,092.9 2,105.1 2,119.0 2,115.2 2,123.0 2,132.7 2,157.3 2,149.7 2,150.4 2,152.2 2,163.6 18 Transaction 302.3 301.8 311.5 312.2 314.5 313.0 316.0 320.2 311.5 311.4 321.9 338.5 19 Nontransaction 1,681.2 1,791.1 1,793.6 1,806.8 1,800.8 1,809.9 1,816.7 1,837.1 1,838.2 1,839.0 1,830.3 1,825.0 ?n Large time 299.9 301.4 304.1 305.9 308.4 307.7 310.6 314.9 313.7 315.2 314.3 315.5 21 Other 1,381.3 1,489.7 1,489.6 1,500.9 1,492.4 1,502.3 1,506.1 1,522.2 1,524.5 1,523.8 1,516.0 1,509.6 22 Borrowings 321.2 367.0 371.8 373.9 389.3 407.2 410.6 407.8 400.7 409.5 411.9 407.3 From banks in the U.S 113.2 129.8 129.3 127.9 138.7 156.0 159.3 156.8 154.3 159.1 157.3 157.0 74 From others 208.0 237.3 242.5 246.0 250.6 251.2 251.3 251.0 246.4 250.5 254.6 250.3 25 Net due to related foreign offices 9.0 8.6 12.3 11.3 12.4 15.2 13.0 11.5 11.3 10.7 10.5 12.0 26 Other liabilities 61.4 67.6 67.1 67.2 65.0 70.7 72.9 74.0 74.7 74.0 73.6 74.5 27 Total liabilities 2,375.1 2,536.1 2,556.3 2,571.4 2,581.9 2,616.0 2,629.2 2,650.5 2,636.3 2,644.7 2,648.1 2,657.4 28 Residual (assets less liabilities)7 145.3 155.2 165.7 173.1 173.1 151.9 162.2 159.8 163.4 159.8 158.4 160.3 Not seasonally adjusted Assets 29 Bank credit 2,199.0 2,342.1 2,368.8 2,392.3 2,412.0 2,406.5 2,416.6 2,431.4 2,423.4 2,424.7 2,430.9 2,435.6 30 Securities in bank credit 619.5 647.8 652.8 660.3 668.9 667.3 667.4 678.3 673.8 672.7 676.6 682.4 31 U.S. government securities 403.6 440.9 446.4 454.2 461.9 459.8 461.0 472.4 466.2 467.7 471.2 475.7 37 Other securities 215.8 206.8 206.4 206.0 207.0 207.5 206.4 205.9 207.6 205.0 205.4 206.7 33 Loans and leases in bank credit2 .... 1,579.6 1,694.3 1,716.1 1,732.0 1,743.0 1,739.2 1,749.2 1,753.1 1,749.5 1,751.9 1,754.3 1,753.2 34 Commercial and industrial 294.3 299.3 302.3 303.7 305.8 303.9 305.3 306.9 306.3 305.7 307.2 307.2 35 Real estate 916.1 994.9 1,009.6 1,020.4 1,023.9 1,023.0 1,031.4 1,035.2 1,032.5 1,036.9 1,034.6 1,034.2 36 Revolving home equity 60.7 73.9 75.5 76.5 77.5 78.1 80.0 81.3 80.7 80.9 81.3 81.7 37 Other 855.3 921.0 934.2 943.9 946.4 945.0 951.4 953.9 951.8 956.0 953.3 952.5 38 Consumer 266.2 287.5 290.7 293.2 298.2 299.1 299.4 297.0 296.5 295.6 299.2 297.8 39 Credit cards and related plans . . 100.5 112.4 115.0 116.9 121.3 119.6 118.3 117.8 116.9 116.6 120.1 118.6 40 Other 165.7 175.1 175.7 176.2 176.9 179.5 181.1 179.2 179.5 178.9 179.0 179.2 41 Security3 7.6 7.9 8.2 8.5 8.4 8.2 8.5 8.7 8.9 8.8 8.6 8.6 47 Other loans and leases 95.3 104.7 105.2 106.3 106.7 105.0 104.6 105.3 105.3 105.0 104.9 105.3 43 Interbank loans 101.0 110.8 118.1 121.9 121.5 119.0 125.5 132.8 134.5 134.4 129.8 132.2 44 Cash assets4 107.6 125.3 128.1 131.3 132.6 130.3 129.1 126.6 128.4 124.6 124.9 124.4 45 Other assets5 140.5 144.8 140.5 142.4 142.8 144.4 148.2 150.8 151.4 154.7 146.9 146.0 46 Total assets6 2,517.8 2,691.5 2,723.6 2,755.7 2,776.4 2,767.7 2,786.8 2,808.8 2,805.2 2,805.6 2,799.6 2,805.4 Liabilities 47 Deposits 1,988.0 2,082.0 2,103.2 2,127.1 2,138.7 2,129.2 2,139.4 2,162.2 2,162.9 2,158.1 2,150.9 2,157.0 48 Transaction 298.8 301.0 311.2 315.7 326.1 318.0 312.7 316.5 310.8 308.1 315.5 329.8 49 Nontransaction 1,689.2 1,781.0 1,792.0 1,811.4 1,812.6 1,811.2 1,826.8 1,845.7 1,852.0 1,850.0 1,835.3 1,827.2 50 Large time 299.9 301.4 304.1 305.9 308.4 307.7 310.6 314.9 313.7 315.2 314.3 315.5 51 Other 1,389.3 1,479.6 1,487.9 1,505.5 1,504.2 1,503.5 1,516.2 1,530.8 1,538.3 1,534.7 1,521.1 1,511.7 57 Borrowings 321.2 367.0 371.8 373.9 389.3 407.2 410.6 407.8 400.7 409.5 411.9 407.3 53 From banks in the U.S 113.2 129.8 129.3 127.9 138.7 156.0 159.3 156.8 154.3 159.1 157.3 157.0 54 From others 208.0 237.3 242.5 246.0 250.6 251.2 251.3 251.0 246.4 250.5 254.6 250.3 55 Net due to related foreign offices 9.0 8.6 12.3 11.3 12.4 15.2 13.0 11.5 11.3 10.7 10.5 12.0 56 Other liabilities 61.4 67.6 67.1 67.2 65.0 70.7 72.9 74.0 74.7 74.0 73.6 74.5 57 Total liabilities 2,379.6 2,525.3 2,554.5 2,579.5 2,605.4 2,622.3 2,635.9 2,655.5 2,649.5 2,652.3 2,646.8 2,650.8 58 Residual (assets less liabilities)7 138.2 166.2 169.1 176.2 171.0 145.5 150.9 153.3 155.7 153.3 152.8 154.6 Footnotes appear on p. A21. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A20 Domestic Nonfinancial Statistics • June 2003 1.26 COMMERCIAL BANKS IN THE UNITED STATES Assets and Liabilities1—Continued E. Foreign-related institutions Billions of dollars Monthly averages Wednesday figures Account 2002 2002 2003 2003 Mar.' Sept.' Oct.' Nov/ Dec.' Jan.' Feb.' Mar. Mar. 5 Mar. 12 Mar. 19 Mar. 26 Seasonally adjusted Assets 1 Bank credit 591.1 619.8 614.6 620.2 636.1 627.6 640.5 658.5 658.7 663.2 654.7 656.4 2 Securities in bank credit 228.6 247.6 244.9 248.0 261.8 262.8 272.9 277.1 282.5 283.3 273.8 271.1 i U.S. government securities 70.9 87.1 89.0 93.5 101.9 102.7 107.6 111.5 110.9 111.2 110.4 110.6 4 Other securities 157.7 160.5 155.9 154.5 159.9 160.1 165.3 165.5 171.5 172.2 163.5 160.5 5 Loans and leases in bank credit2 .... 362.5 372.2 369.7 372.2 374.3 364.8 367.6 381.4 376.3 379.9 380.9 385.3 6 Commercial and industrial 195.5 185.0 181.1 178.9 178.4 176.4 172.3 169.0 170.9 170.8 168.2 168.2 7 Real estate 18.0 19.0 19.6 20.0 19.5 18.9 18.1 17.8 18.0 18.1 17.8 18.0 8 Security3 79.9 95.2 97.5 104.7 110.1 105.1 112.9 130.0 121.8 126.5 129.8 135.7 9 Other loans and leases 69.1 73.0 71.5 68.6 66.4 64.4 64.4 64.5 65.6 64.6 65.1 63.4 10 Interbank loans 20.7 21.2 24.5 25.5 30.0 28.8 28.8 30.5 30.7 31.2 32.4 30.6 11 Cash assets4 44.4 46.6 45.5 42.3 44.6 40.0 38.3 42.5 38.4 40.5 44.2 44.6 12 Other assets5 24.9 29.0 33.8 34.6 35.9 39.9 41.7 38.1 40.7 38.8 36.5 36.1 13 Total assets6 680.7 716.2 718.0 722.2 746.3 735.9 749.0 769.2 768.2 773.4 767.4 767.3 Liabilities 14 Deposits 482.4 492.3 471.4 452.6 425.6 426.8 443.4 449.2 453.9 455.1 459.9 438.4 15 Transaction 10.2 10.1 9.6 9.2 9.2 9.5 9.7 10.6 11.1 10.7 10.6 10.4 16 Nontransaction 472.2 482.2 461.8 443.3 416.4 417.2 433.6 438.6 442.8 444.3 449.3 428.0 17 Borrowings 187.5 225.1 232.7 251.2 277.9 271.7 276.8 299.4 294.0 297.7 291.9 311.6 18 From banks in the US 20.8 22.6 23.0 25.2 29.9 31.0 31.4 34.3 37.3 37.0 31.8 33.0 19 From others 166.6 202.5 209.7 226.0 248.0 240.6 245.4 265.1 256.7 260.7 260.1 278.6 20 Net due to related foreign offices -72.5 -83.7 -71.6 -73.3 -59.2 -70.0 -78.6 -85.6 -86.0 -86.6 -84.3 -94.3 21 Other liabilities 73.4 93.8 99.7 99.3 102.1 98.9 101.1 95.3 104.2 102.1 91.8 90.3 22 Total liabilities 670.8 727.4 732.2 729.7 746.4 727.3 742.7 758.3 766.1 768.3 759.2 746.0 23 Residual (assets less liabilities)7 9.9 -11.2 -14.2 -7.5 -.2 8.6 6.3 10.9 2.1 5.0 8.1 21.3 Not seasonally adjusted Assets 24 Bank credit 591.0 616.3 614.1 623.8 646.2 635.5 645.0 656.3 660.9 661.7 654.3 652.1 25 Securities in bank credit 228.6 247.6 244.9 248.0 261.8 262.8 272.9 277.1 282.5 283.3 273.8 271.1 26 U.S. government securities 70.9 87.1 89.0 93.5 101.9 102.7 107.6 111.5 110.9 111.2 110.4 110.6 27 Trading account 9.3 16.1 18.6 20.3 30.6 32.1 34.9 34.6 36.1 34.2 32.3 33.8 28 Investment account 61.6 71.0 70.4 73.2 71.3 70.6 72.7 76.9 74.8 77.0 78.1 76.8 29 Other securities 157.7 160.5 155.9 154.5 159.9 160.1 165.3 165.5 171.5 172.2 163.5 160.5 30 Trading account 100.3 105.1 101.5 100.4 101.3 101.2 100.3 98.9 105.4 104.3 95.9 94.4 31 Investment account 57.4 55.4 54.4 54.0 58.6 58.9 65.0 66.6 66.1 67.8 67.6 66.1 32 Loans and leases in bank credit2 .... 362.4 368.7 369.2 375.8 384.3 372.7 372.1 379.2 378.5 378.4 380.5 381.0 33 Commercial and industrial 197.2 184.9 181.2 180.3 179.8 176.5 173.7 170.5 172.8 171.9 170.2 169.6 34 Real estate 18.0 19.0 19.6 20.0 19.5 18.9 18.1 17.8 18.0 18.1 17.8 18.0 35 Security3 77.1 92.3 97.5 106.8 116.7 112.2 115.8 125.5 121.1 123.2 126.5 129.1 36 Other loans and leases 70.1 72.4 70.9 68.8 68.3 65.1 64.5 65.4 66.5 65.2 66.0 64.4 37 Interbank loans 20.7 21.2 24.5 25.5 30.0 28.8 28.8 30.5 30.7 31.2 32.4 30.6 38 Cash assets4 43.2 46.3 46.6 44.7 47.8 42.9 39.3 41.3 38.1 39.5 42.8 43.2 39 Other assets5 25.5 29.0 33.3 34.5 37.0 41.3 42.3 39.1 42.0 40.6 37.2 36.4 40 Total assets6 680.0 712.4 718.1 728.1 760.5 748.1 755.1 766.8 771.4 772.6 766.3 762.0 Liabilities 41 Deposits 486.9 474.1 459.1 452.7 436.4 442.9 453.5 453.3 457.7 457.4 462.1 445.0 42 Transaction 9.9 10.3 9.8 9.5 10.0 9.8 9.7 10.3 10.7 10.3 10.2 10.0 43 Nontransaction 477.0 463.9 449.3 443.1 426.5 433.1 443.8 443.1 446.9 447.1 451.9 435.0 44 Borrowings 187.5 225.1 232.7 251.2 277.9 2717 276.8 299.4 294.0 297.7 291.9 311.6 45 From banks in the U.S 20.8 22.6 23.0 25.2 29.9 31.0 31.4 34.3 37.3 37.0 31.8 33.0 46 From others 166.6 202.5 209.7 226.0 248.0 240.6 245.4 265.1 256.7 260.7 260.1 278.6 47 Net due to related foreign offices -69.6 -82.2 -73.1 -74.7 -57.4 -67.4 -77.5 -83.3 -85.4 -85.6 -81.5 -89.3 48 Other liabilities 74.6 94.8 98.8 98.4 103.3 100.6 102.0 96.8 104.8 102.8 93.7 93.6 49 Total liabilities 679.4 711.8 717.6 727.6 760.1 747.8 754.9 766.2 771.0 772.3 766.1 760.9 50 Residual (assets less liabilities)7 .5 .6 .5 .5 .4 .4 .2 .6 .3 .2 .2 1.1 Footnotes appear on p. A21. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banking Institutions—Assets and Liabilities A21 1.26 COMMERCIAL BANKS IN THE UNITED STATES Assets and Liabilities1—Continued F. Memo items Billions of dollars Monthly averages Wednesday figures AAAccccccooouuunnnttt 2002 2002 2003 2003 Mar. Sept. Oct. Nov.' Dec.' Jan. Feb.' Mar. Mar. 5 Mar. 12 Mar. 19 Mar. 26 Not seasonally adjusted MEMO Large domestically chartered banks. adjusted for mergers 1 Revaluation gains on off-balance-sheet items8 73.2 117.2R 102.4' 105.2 112.6 107.9' 117.0 115.5 128.1 128.5 106.4 108.7 2 Revaluation losses on off-balancesheet items8 53.0 98.6' 85.7' 89.0 93.8 86.2' 94.9 91.3 105.0 104.9 82.4 82.7 3 Mortgage-backed securities' 299.8R 344.0' 355.3' 370.5 363.2 368.9' 374.9 379.4 386.7 378.9 376.9 374.3 4 Pass-through 201.6 255.0 261.7 274.6 265.6 271.2 276.5 275.8 284.8 277.0 276.4 271.2 5 CMO, REMIC, and other 98.2R 89.0' 93.6' 95.9 97.6 97.7' 98.4 103.6 101.9 101.9 100.5 103.1 6 Net unrealized gains (losses) on available-for-sale securities10 3.2 11.5 11.9' 11.3 10.7 12.1' 12.0 12.1 14.3 13.1 11.2 11.4 7 Off-shore credit to U.S. residents" .... 19.8 19.0 18.4 18.5 18.7 18.3 18.2 18.2 17.8 18.3 18.3 18.5 8 Securitized consumer loans12 133.8 141.9 144.3 148.5 150.1 149.7 150.6 152.5 150.6 151.9 151.9 153.6 9 Credit cards and related plans 120.4 125.0 127.5 131.4 133.2 132.2 134.8 136.7 135.1 136.4 136.0 137.6 10 Other 13.4 16.9 16.9 17.0 16.9 17.5 15.8 15.8 15.6 15.5 16.0 15.9 11 Securitized business loans12 18.1 17.8 17.8 17.4 17.2 16.9 17.2 16.8 17.0 16.9 16.8 16.7 Small domestically chartered commercial banks, adjusted for mergers 12 Mortgage-backed securities9 276. lr 303.8' 304.1' 307.7 311.1 310.9' 316.8 327.9 324.2 325.5 327.3 328.7 13 Securitized consumer loans12 203.2' 199.9 198.3 198.7 201.3 205.6 204.5 203.2 203.1 204.4 201.6 203.3 14 Credit cards and related plans 195.5R 195.9 189.3 189.8 192.5 197.1 196.0 194.8 194.7 195.9 193.1 194.9 15 Other 7.7 3.9 8.9 8.9 8.7 8.5 8.4 8.5 8.4 8.5 8.5 8.5 Foreign-related institutions 16 Revaluation gains on off-balancesheet items8 47.2R 63.0' 61.9 63.3 64.1 66.8' 66.8 64.6 69.7 69.1 62.2 60.8 17 Revaluation losses on off-balancesheet items8 40.6 61.7' 60.2 60.3 60.0 63.0 65.0 63.5 68.8 68.4 61.1 59.7 18 Securitized business loans12 12.4 8.1 7.6 7.2 6.8 5.6' 4.7 4.1 4.6 4.6 4.5 3.5 NOTE. Tables 1.26, 1.27, and 1.28 have been revised to reflect changes in the Board's H.8 acquiring bank. Balance sheet data for acquired banks are obtained from Call Reports, and a statistical release, "Assets and Liabilities of Commercial Banks in the United States." Table ratio procedure is used to adjust past levels. 1.27, "Assets and Liabilities of Large Weekly Reporting Commercial Banks," and table 1.28, 2. Excludes federal funds sold to, reverse RPs with, and loans made to commercial banks "Large Weekly Reporting U.S. Branches and Agencies of Foreign Banks," are no longer in the United States, all of which are included in "Interbank loans." being published in the Bulletin. Instead, abbreviated balance sheets for both large and small 3. Consists of reverse RPs with brokers and dealers and loans to purchase and carry domestically chartered banks have been included in table 1.26, parts C and D. Data are both securities. merger-adjusted and break-adjusted. In addition, data from large weekly reporting U.S. 4. Includes vault cash, cash items in process of collection, balances due from depository branches and agencies of foreign banks have been replaced by balance sheet estimates of all institutions, and balances due from Federal Reserve Banks. foreign-related institutions and are included in table 1.26, part E. These data are break- 5. Excludes the due-from position with related foreign offices, which is included in "Net adjusted. due to related foreign offices." The not-seasonally-adjusted data for all tables now contain additional balance sheet items, 6. Excludes unearned income, reserves for losses on loans and leases, and reserves for which were available as of October 2, 1996. transfer risk. Loans are reported gross of these items. 1. Covers the following types of institutions in the fifty states and the District of Columbia: 7. This balancing item is not intended as a measure of equity capital for use in capital domestically chartered commercial banks that submit a weekly report of condition (large adequacy analysis. On a seasonally adjusted basis, this item reflects any differences in the domestic); other domestically chartered commercial banks (small domestic); branches and seasonal patterns estimated for total assets and total liabilities. agencies of foreign banks, and Edge Act and agreement corporations (foreign-related institu- 8. Fair value of derivative contracts (interest rate, foreign exchange rate, other commodity tions). Excludes International Banking Facilities. Data are Wednesday values or pro rata and equity contracts) in a gain/loss position, as determined under FASB Interpretation No. 39. averages of Wednesday values. Large domestic banks constitute a universe; data for small 9. Includes mortgage-backed securities issued by U.S. government agencies, U.S. domestic banks and foreign-related institutions are estimates based on weekly samples and on government-sponsored enterprises, and private entities. quarter-end condition reports. Data are adjusted for breaks caused by reclassifications of 10. Difference between fair value and historical cost for securities classified as availableassets and liabilities. for-sale under FASB Statement No. 115. Data are reported net of tax effects. Data shown are The data for large and small domestic banks presented on pp. A17-19 are adjusted to restated to include an estimate of these tax effects. remove the estimated effects of mergers between these two groups. The adjustment for 11. Mainly commercial and industrial loans but also includes an unknown amount of credit mergers changes past levels to make them comparable with current levels. Estimated extended to other than nonfinancial businesses. quantities of balance sheet items acquired in mergers are removed from past data for the bank 12. Total amount outstanding. group that contained the acquired bank and put into past data for the group containing the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A22 DomesticN onfinancial Statistics • June 2003 1.32 COMMERCIAL PAPER OUTSTANDING Millions of dollars, seasonally adjusted, end of period Year ending December 2002 2003 IItteemm 1998 1999 2000 2001 2002 Sept. Oct. Nov. Dec. Jan. Feb. 1 All issuers 1,163,303 1,403,023 1,615,341 1,438,764 1,321,517 1,338,119 1,350,182 1,351,428 1,321,517 1,345,460 1,318,803 Financial companies1 2 Dealer-placed paper, total2 614,142 786,643 973,060 989,364 949,683 856,037 973,150 982,239 949,683 955,386 924,890 3 Directly placed paper, total3 322,030 337,240 298,848 224,553 217,787 322,729 219,581 211,574 217,787 236,820 239,037 4 Nonfinancial companies4 227,132 279,140 343,433 224,847 154,047 159,353 157,451 157,615 154,047 153,254 154,876 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. 1.33 PRIME RATE CHARGED BY BANKS Short-Term Business Loans1 Percent per year Date of change Average Average Average rate rate rate 2000—Jan. 1 8.50 2000 .... 9.23 2001—Jan. 9.05 2002—Jan. 4.75 Feb. 3 8.75 2001 .... 6.91 Feb. 8.50 Feb. 4.75 Mar. 22 9.00 2002 .... 4.67 Mar. 8.32 Mar. 4.75 May 17 9.50 Apr. 7.80 Apr. 4.75 2000—Jan. 8.50 May 7.24 May 4.75 2001—Jan. 4 9.00 Feb. 8.73 June 6.98 June 4.75 Feb. 1 8.50 Mar. 8.83 July 6.75 July 4.75 Mar. 21 8.00 Apr. 9.00 Aug. 6.67 Aug. 4.75 Apr. 19 7.50 May 9.24 Sept. 6.28 Sept. 4.75 May 16 7.00 June 9.50 Oct. 5.53 Oct. 4.75 June 28 6.75 July 9.50 Nov. 5.10 Nov. 4.35 Aug. 22 6.50 Aug. 9.50 Dec. 4.84 Dec. 4.25 Sept. 18 6.00 Sept. 9.50 Oct. 3 5.50 Oct. 9.50 2003—Jan. 4.25 Nov. 7 5.00 Nov. 9.50 Feb. 4.25 Dec. 12 4.75 Dec. 9.50 Mar. 4.25 Apr. 4.25 2002—Nov. 7 4.25 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 2002 2003 2003, week ending IItteemm 22000000 22000011 22000022 Dec. Jan. Feb. Mar. Feb. 28 Mar. 7 Mar. 14 Mar. 21 Mar. 28 MONEY MARKET INSTRUMENTS 1 Federal funds12,3 6.24 3.88 1.67 1.24 1.24 1.26 1.25 1.24 1.29 1.21 1.27 1.22 2 Discount window primary credit2 4 n.a. n.a. n.a. n.a. n.a. 2.25 2.25 2.25 2.25 2.25 2.25 2.25 Commercial paper3-5 6 Nonfinancial 3 1-month 6.27 3.78 1.67 1.31 1.25 1.24 1.21 1.25 1.23 1.19 1.21 11..2233 4 2-month 6.29 3.68 1.67 1.32 1.26 1.25 1.20 1.25 1.24 1.16 1.20 1.22 5 3-month 6.31 3.65 1.69 1.31 1.26 1.26 1.19 1.25 1.23 1.15 1.18 1.20 Financial 6 1-month 6.28 3.80 1.68 1.31 1.26 1.25 1.23 1.25 1.24 1.21 1.23 11..2244 7 2-month 6.30 3.71 1.69 1.32 1.27 1.25 1.22 1.25 1.25 1.18 1.21 1.23 8 3-month 6.33 3.65 1.70 1.32 1.27 1.25 1.21 1.25 1.24 1.17 1.19 1.23 Certificates of deposit, secondary market3 7 9 1-month 6.35 3.84 1.72 1.37 1.29 1.27 1.25 11..2277 11..2277 11..2233 11..2255 11..2266 10 3-month 6.46 3.71 1.73 1.34 1.29 1.27 1.23 1.27 1.26 1.18 1.22 1.25 11 6-month 6.59 3.66 1.81 1.36 1.30 1.27 1.20 1.27 1.25 1.15 1.20 1.22 12 Eurodollar deposits, 3-month3-8 6.45 3.70 1.73 1.35 1.29 1.26 1.21 1.26 1.24 1.18 1.21 1.23 U.S. Treasury bills Secondary market3-5 13 4-week n.a. 2.43 1.60 1.18 1.15 1.18 1.16 1.21 1.18 1.13 1.16 11..1166 14 3-month 5.82 3.40 1.61 1.19 1.17 1.17 1.13 1.19 1.15 1.09 1.14 1.15 15 6-month 5.90 3.34 1.68 1.24 1.20 1.18 1.13 1.18 1.15 1.07 1.15 1.15 U.S. TREASURY NOTES AND BONDS Constant maturities9 16 1-year 6.11 3.49 2.00 1.45 1.36 1.30 1.24 1.27 1.22 1.16 1.32 1.27 17 2-year 6.26 3.83 2.64 1.84 1.74 1.63 1.57 1.57 1.47 1.47 1.72 1.65 18 3-year 6.22 4.09 3.10 2.23 2.18 2.05 1.98 1.96 1.84 1.85 2.14 2.08 19 5-year 6.16 4.56 3.82 3.03 3.05 2.90 2.78 2.76 2.61 2.62 2.97 2.93 70 7-year 6.20 4.88 4.30 3.63 3.60 3.45 3.34 3.31 3.17 3.18 3.52 3.51 21 10-year 6.03 5.02 4.61 4.03 4.05 3.90 3.81 3.78 3.65 3.65 3.97 3.96 22 20-year 6.23 5.63 5.43 5.01 5.02 4.87 4.82 4.78 4.68 4.68 4.94 4.96 Treasury long-term average10 " 23 25 years and above n.a. n.a. 5.41 5.06 5.07 4.93 4.90 4.86 4.77 4.77 5.01 55..0044 STATE AND LOCAL NOTES AND BONDS Moody's series'2 ?4 5.58 5.01 4.87 4.70 4.72 4.57 4.51 4.48 4.40 4.39 4.55 4.69 25 Baa 6.19 5.75 5.64 5.57 5.61 5.48 5.32 5.38 5.28 5.21 5.38 5.40 26 Bond Buyer series13 5.71 5.15 5.04 4.85 4.90 4.81 4.76 4.74 4.69 4.67 4.83 4.84 CORPORATE BONDS 27 Seasoned issues, all industries14 7.98 7.49 7.10 6.77 6.72 6.50 6.42 6.43 6.35 6.36 6.51 6.46 Rating group ?8 Aaa15 7.62 7.08 6.49 6.21 6.17 5.95 5.89 5.89 5.82 5.82 5.99 55..9944 ?9 Aa 7.83 7.26 6.93 6.63 6.59 6.34 6.28 6.28 6.22 6.22 6.38 6.33 30 A 8.11 7.67 7.18 6.80 6.77 6.63 6.54 6.57 6.48 6.49 6.65 6.58 31 Baa 8.37 7.95 7.80 7.45 7.35 7.06 6.95 6.97 6.90 6.90 7.04 6.97 MEMO Dividend-price ratio16 32 Common stocks 1.15 1.32 1.61 1.77 1.81 1.91 1.92 1.89 1.94 1.93 1.93 1.87 NOTE. Some of the data in this table also appear in the Board's H.15 (519) weekly 8. Bid rates for eurodollar deposits collected around 9:30 a.m. Eastern time. Data are for statistical release. For ordering address, see inside front cover. indication purposes only. 1. The daily effective federal funds rate is a weighted average of rates on trades through 9. Yields on actively traded issues adjusted to constant maturities. New York brokers. 10. Based on the unweighted average of the bid yields for all Treasury fixed-coupon 2. Weekly figures are averages of seven calendar days, ending on Wednesday of the securities with remaining terms to maturity of 25 years and over. current week; monthly figures include each calendar day in the month. 11. A factor for adjusting the daily long-term average in order to estimate a 30-year rate 3. Annualized using a 360-day year or bank interest. can be found at http://www.treas.gov/offices/domestic-finance/debt-management/interest-rate/ 4. The rate charged for discounts made and advances extended under the Federal Re- ltcompositeindex.html. serve's primary credit discount window program, which became effective January 9, 2003. 12. General obligation bonds based on Thursday figures; Moody's Investors Service. This rate replaces that for adjustment credit, which was discontinued after January 8, 2003. 13. State and local government general obligation bonds maturing in twenty years are used For further information, see http://www.federalreserve.gov/boarddocs/press/bcreg/2002/ in compiling this index. The twenty-bond index has a rating roughly equivalent to Moody's 200210312/default.htm. The rate reported is that for the Federal Reserve Bank of New York. A1 rating. Based on Thursday figures. Historical series for the rate on adjustment credit is available at: http:// 14. Daily figures are averages of Aaa, Aa, A, and Baa yields from Moody's Investors www.federalreserve.gov/releases/hl5/data.htm. Service. Based on yields to maturity on selected long-term bonds. 5. Quoted on a discount basis. 15. Effective December 7, 2001, the Moody's Aaa yield includes yields only for industrial 6. Interest rates interpolated from data on certain commercial paper trades settled by the firms. Prior to December 7, 2001, the Aaa yield represented both utilities and industrial. Depository Trust Company. The trades represent sales of commercial paper by dealers or 16. Standard & Poor's corporate series. Common stock ratio is based on the 500 stocks in direct issuers to investors (that is, the offer side). See the Board's Commercial Paper web the price index. pages (http://www.federalreserve.gov/releases/cp) for more information. SOURCE: U.S. Department of the Treasury. 7. An average of dealer offering rates on nationally traded certificates of deposit. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A24 Domestic Nonfinancial Statistics • June 2003 1.36 STOCK MARKET Selected Statistics 2002 2003 IInnddiiccaattoorr 22000000 22000011 22000022 July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Prices and trading volume (averages of daily figures) CCCCCCCooooooommmmmmmmmmmmmmooooooonnnnnnn ssssssstttttttoooooooccccccckkkkkkk ppppppprrrrrrriiiiiiiccccccceeeeeeesssssss (((((((iiiiiiinnnnnnndddddddeeeeeeexxxxxxxeeeeeeesssssss))))))) 1111111 NNNNNNNeeeeeeewwwwwww YYYYYYYooooooorrrrrrrkkkkkkk SSSSSSStttttttoooooooccccccckkkkkkk EEEEEEExxxxxxxccccccchhhhhhhaaaaaaannnnnnngggggggeeeeeee (((((((DDDDDDDeeeeeeeccccccc....... 33333331111111,,,,,,, 1111111999999966666665555555-------55555550000000))))))) 6,806.46 6,407.95 5,571.46 5,139.94 5,200.62 4,980.65 4,862.70 5,104.89 5,075.76 5,055.78 4,738.56 4,724.22 2222222 IIIIIIInnnnnnnddddddduuuuuuussssssstttttttrrrrrrriiiiiiiaaaaaaalllllll 809.40 749.46 656.44 603.04 611.34 589.14 574.45 597.75 593.15 587.78 553.90 558.10 3333333 TTTTTTTrrrrrrraaaaaaannnnnnnssssssspppppppooooooorrrrrrrtttttttaaaaaaatttttttiiiiiiiooooooonnnnnnn 414.73 444.45 430.63 416.07 409.96 388.19 383.41 405.03 401.39 394.60 367.55 366.90 4444444 UUUUUUUtttttttiiiiiiillllllliiiiiiitttttttyyyyyyy 478.99 377.72 260.50 230.21 225.52 210.76 207.83 229.41 236.71 236.42 214.64 211.45 5555555 FFFFFFFiiiiiiinnnnnnnaaaaaaannnnnnnccccccceeeeeee 552.48 596.61 554.88 524.01 533.60 506.05 494.06 523.50 519.72 522.51 485.72 486.71 6666666 SSSSSSStttttttaaaaaaannnnnnndddddddaaaaaaarrrrrrrddddddd &&&&&&& PPPPPPPoooooooooooooorrrrrrr'''''''sssssss CCCCCCCooooooorrrrrrrpppppppooooooorrrrrrraaaaaaatttttttiiiiiiiooooooonnnnnnn (((((((1111111999999944444441111111^^^^^^^11111113333333 ------- 11111110000000)))))))''''''' 1,427.22 1,194.18 993.94 903.59 912.55 867.81 854.63 909.93 899.18 895.84 837.62 846.62 7777777 AAAAAAAmmmmmmmeeeeeeerrrrrrriiiiiiicccccccaaaaaaannnnnnn SSSSSSStttttttoooooooccccccckkkkkkk EEEEEEExxxxxxxccccccchhhhhhhaaaaaaannnnnnngggggggeeeeeee (((((((AAAAAAAuuuuuuuggggggg....... 33333331111111,,,,,,, 1111111999999977777773333333 ------- 55555550000000)))))))2222222 922.22 879.08 860.11 840.76 843.89 852.03 807.38 820.62 823.77 824.64 818.84 822.34 VVVVVVVooooooollllllluuuuuuummmmmmmeeeeeee ooooooofffffff tttttttrrrrrrraaaaaaadddddddiiiiiiinnnnnnnggggggg (((((((ttttttthhhhhhhooooooouuuuuuusssssssaaaaaaannnnnnndddddddsssssss ooooooofffffff ssssssshhhhhhhaaaaaaarrrrrrreeeeeeesssssss))))))) 8888888 NNNNNNNeeeeeeewwwwwww YYYYYYYooooooorrrrrrrkkkkkkk SSSSSSStttttttoooooooccccccckkkkkkk EEEEEEExxxxxxxccccccchhhhhhhaaaaaaannnnnnngggggggeeeeeee 1,026,867 1,216,529 1,411,689 1,848,962 1,317,105 1,370,143 1,619,896 1,427,254 1,210,332 1,441,846 1,302,011 1,403,742 9999999 AAAAAAAmmmmmmmeeeeeeerrrrrrriiiiiiicccccccaaaaaaannnnnnn SSSSSSStttttttoooooooccccccckkkkkkk EEEEEEExxxxxxxccccccchhhhhhhaaaaaaannnnnnngggggggeeeeeee 51,437 68,074 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. Customer financing (millions of dollars, end-of-period balances) 11111110000000 MMMMMMMaaaaaaarrrrrrrgggggggiiiiiiinnnnnnn cccccccrrrrrrreeeeeeedddddddiiiiiiittttttt aaaaaaattttttt bbbbbbbrrrrrrroooooookkkkkkkeeeeeeerrrrrrr-------dddddddeeeeeeeaaaaaaallllllleeeeeeerrrrrrrsssssss3333333 198,790 150,450 134,380 136,160 132,800 130,210 130,570 133,060 134,380 134,910 134,030 135,910 FFFFFFFrrrrrrreeeeeeeeeeeeee cccccccrrrrrrreeeeeeedddddddiiiiiiittttttt bbbbbbbaaaaaaalllllllaaaaaaannnnnnnccccccceeeeeeesssssss aaaaaaattttttt bbbbbbbrrrrrrroooooookkkkkkkeeeeeeerrrrrrrsssssss4444444 11111111111111 MMMMMMMaaaaaaarrrrrrrgggggggiiiiiiinnnnnnn aaaaaaaccccccccccccccooooooouuuuuuunnnnnnntttttttsssssss5555555 100,680 101,640 95,690 98,080 95,400 98,630 96,620 91,240 95,690 96,430 95,400 90,830 11111112222222 CCCCCCCaaaaaaassssssshhhhhhh aaaaaaaccccccccccccccooooooouuuuuuunnnnnnntttttttsssssss 84,400 78,040 73,340 68,860 63,700 67,550 66,780 67,380 73,340 66,200 67,260 68,860 Margin requirements (percent of market value and effective date)6 Mar. 11, 1968 June 8, 1968 May 6, 1970 Dec. 6, 1971 Nov. 24, 1972 Jan. 3, 1974 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. In July 1976 a financial group, composed of banks and insurance companies, was added 6. Margin requirements, stated in regulations adopted by the Board of Governors pursuant to the group of stocks on which the index is based. The index is now based on 400 industrial to the Securities Exchange Act of 1934, limit the amount of credit that can be used to stocks (formerly 425), 20 transportation (formerly 15 rail), 40 public utility (formerly 60), and purchase and carry "margin securities" (as defined in the regulations) when such credit is 40 financial. collateralized by securities. Margin requirements on securities are the difference between the 2. On July 5, 1983, the American Stock Exchange rebased its index, effectively cutting market value (100 percent) and the maximum loan value of collateral as prescribed by the previous readings in half. Board. Regulation T was adopted effective Oct. 15, 1934; Regulation U, effective May 1, 3. Since July 1983, under the revised Regulation T, margin credit at broker-dealers has 1936; Regulation G, effective Mar. 11, 1968; and Regulation X, effective Nov. 1, 1971. included credit extended against stocks, convertible bonds, stocks acquired through the On Jan. 1, 1977, the Board of Governors for the first time established in Regulation T the exercise of subscription rights, corporate bonds, and government securities. Separate report- initial margin required for writing options on securities, setting it at 30 percent of the current ing of data for margin stocks, convertible bonds, and subscription issues was discontinued in market value of the stock underlying the option. On Sept. 30, 1985, the Board changed the April 1984. required initial margin, allowing it to be the same as the option maintenance margin required 4. Free credit balances are amounts in accounts with no unfulfilled commitments to by the appropriate exchange or self-regulatory organization; such maintenance margin rules brokers and are subject to withdrawal by customers on demand. must be approved by the Securities and Exchange Commission. 5. Series initiated in June 1984. 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 2001 2002 2003 IItteemm Mar. 31 June 30 Sept. 30 Dec. 31 Mar. 31 June 30 Sept. 30 Dec. 31 Mar. 31 1 Federal debt outstanding 5,800.6 5,753.9 5,834.5 5,970.3 6,032.4 6,153.3 6,255.4 6,433.0 6,487.7 2 Public debt securities 5,773.7 5,726.8 5,807.5 5,943.4 6,006.0 6,126.5 6,228.2 6,405.7 6,460.8 3 Held by public 3,434.4 3,274.2 3,338.7 3,393.8 3,443.7 3,463.5 3,552.6 3,647.4 3,710.8 4 Held by agencies 2,339.4 2,452.6 2,468.8 2,549.7 2,562.4 2,662.9 2,675.6 2,758.3 2,750.0 5 Agency securities 26.8 27.1 27.0 26.8 26.4 26.8 27.2 27.3 26.9 6 Held by public 26.8 27.1 27.0 26.8 26.4 26.8 27.2 27.3 26.9 7 Held by agencies .1 .0 .0 .0 .0 .0 .0 .0 .0 8 Debt subject to statutory limit 5,692.5 5,645.0 5,732.6 5,871.4 5,935.1 6,058.3 6,161.4 6,359.4 6,399.9 9 Public debt securities 5,692.3 5,644.8 5,732.4 5,871.2 5,935.0 6,058.1 6,161.1 6,359.1 6,399.8 10 Other debt1 .2 .2 .2 .3 .2 .2 .3 .3 .2 MEMO 11 Statutory debt limit 5,950.0 5,950.0 5,950.0 5,950.0 5,950.0 6,400.0 6,400.0 6,400.0 6,400.0 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 Monthly Treasury Statement. bia stadium bonds. 1.41 GROSS PUBLIC DEBT OF U.S. TREASURY Types and Ownership Billions of dollars, end of period 2002 2003 TTyyppee aanndd hhoollddeerr 11999999 22000000 22000011 22000022 Q2 Q3 Q4 Ql 1 Total gross public debt 5,776.1 5,662.2 5,943.4 6,405.7 6,126.5 6,228.2 6,405.7 6,460.8 By type 2 Interest-bearing 5,766.1 5,618.1 5,930.8 6,391.4 6,087.0 6,216.3 6,391.4 6,474.0 3 Marketable 3,281.0 2,966.9 2,982.9 3,205.1 3,024.8 3,136.6 3,205.1 3,331.8 4 Bills 737.1 646.9 811.3 888.8 822.5 868.3 888.8 955.0 5 Notes 1,784.5 1,557.3 1,413.9 1,580.8 1,446.9 1,521.5 1,580.8 1,622.9 6 Bonds 643.7 626.5 602.7 588.7 592.9 592.9 588.7 585.7 7 Inflation-indexed notes and bonds1 100.7 121.2 140.1 146.9 147.5 138.9 146.9 153.2 8 Nonmarketable2 2,485.1 2,651.2 2,947.9 3,186.3 3,062.2 3,079.6 3,186.3 3,142.2 9 State and local government series 165.7 151.0 146.3 153.4 142.8 144.3 153.4 148.8 10 Foreign issues3 31.3 27.2 15.4 11.2 13.3 12.5 11.2 12.2 11 Government 31.3 27.2 15.4 11.2 13.3 12.5 11.2 12.2 12 Public .0 .0 .0 .0 .0 .0 .0 .0 13 Savings bonds and notes 179.4 176.9 181.5 184.8 184.8 185.6 184.8 187.3 14 Government account series4 2,078.7 2,266.1 2,574.8 2,806.9 2,691.4 2,707.3 2,806.9 2,763.8 15 Non-interest-bearing 10.0 44.2 12.7 14.3 39.5 12.0 14.3 13.8 By holders 16 U.S. Treasury and other federal agencies and trust funds 2,064.2 2,270.1 2,572.2 2,757.8 2,686.0 2,701.3 2,757.8 n.a. 17 Federal Reserve Banks6 478.0 511.7 551.7 629.4 590.7 604.2 629.4 641.5 18 Private investors 3,233.9 2,880.4 2,819.5 3,018.5 2,849.8 2,924.8 3,018.5 n.a. 19 Depository institutions 248.7 201.5 181.5 223.2 204.4 210.4 223.2 n.a. 20 Mutual funds 228.6 220.8 257.5 278.1 250.0 253.6 278.1 n.a. 21 Insurance companies 123.4 110.2 105.7 117.4 110.3 116.0 117.4 n.a. 22 State and local treasuries7 266.8 236.2 256.5 274.2 271.7 269.4 274.2 n.a. Individuals 23 Savings bonds 186.4 184.8 190.3 194.9 192.7 193.3 194.9 n.a. 24 Pension funds 321.0 304.1 281.6 284.2 286.0 284.9 284.2 n.a. 25 Private 109.8 108.4 104.2 111.4 108.8 110.9 111.4 n.a. 26 State and Local 211.2 195.7 177.4 172.8 177.2 174.1 172.8 n.a. 27 Foreign and international8 1,268.7 1,034.2 1,053.1 1,174.2 1,068.1 1,128.6 1,174.2 n.a. 28 Other miscellaneous investors7,9 590.3 588.7 493.3 n.a. 466.5 471.1 n.a. n.a. 1. The U.S. Treasury first issued inflation-indexed securities during the first quarter of 8. Includes nonmarketable foreign series Treasury securities and Treasury deposit funds. 1997. Excludes Treasury securities held under repurchase agreements in custody accounts at the 2. Includes (not shown separately) securities issued to the Rural Electrification Administra- Federal Reserve Bank of New York. tion, depository bonds, retirement plan bonds, and individual retirement bonds. 9. Includes individuals, government-sponsored enterprises, brokers and dealers, bank 3. Nonmarketable series denominated in dollars, and series denominated in foreign cur- personal trusts and estates, corporate and noncorporate businesses, and other investors. rency held by foreigners. SOURCES. Data by type of security, U.S. Treasury Department, Monthly Statement of the 4. Held almost entirely by U.S. Treasury and other federal agencies and trust funds. Public Debt of the United States', data by holder, Federal Reserve Board of Governors, Flow 5. Data for Federal Reserve Banks and U.S. government agencies and trust funds are actual of Funds Accounts of the United States and U.S. Treasury Department, Treasury Bulletin, holdings; data for other groups are Treasury estimates. unless otherwise noted. 6. U.S. Treasury securities bought outright by Federal Reserve Banks, see Bulletin table 1.18. 7. 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

A26 Domestic NonfinancialS tatistics • June 2003 1.42 U.S. GOVERNMENT SECURITIES DEALERS Transactions1 Millions of dollars, daily averages 2002 2003 2003, week ending Dec. Jan. Feb. Jan. 29 Feb. 5 Feb. 12 Feb. 19 Feb. 26 Mar. 5 Mar. 12 Mar. 19 Mar. 26 By type of security 1 U.S. Treasury bills 44,252 39,484 42,383 38,052 44,310 37,510 38,707 44,677 53,289 49,336 45,219 46,463 Treasury coupon securities by maturity 2 Three years or less 98,091 122,814 116,714 124,329 122,494 114,312 95,291 126,063 133,520 111188,,555555 131,671 125,796 3 More than three but less than or equal to six years 78,534 119,127 111,100 98,307 110,023 128,243 97,747 104,503 113,057 113,654 140,634 106,269 4 More than six but less than or equal to eleven years 61,252 75,346 85,141 73,479 73,820 88,227 90,878 83,004 88,275 86,129 110,120 93,821 5 More than eleven 15,748 16,002 20,817 16,642 15,594 22,002 17,694 23,597 24,985 24,991 23,348 17,570 6 Inflation-indexed2 2,380 3,969 2,995 2,451 3,316 3,248 2,185 3,477 2,294 2,563 3,823 3,176 Federal agency and governmentsponsored enterprises 7 Discount notes 54,947 56,755 56,333 51,741 57,810 54,206 61,150 51,402 62,131 48,025 52,359 51,092 Coupon securities by maturity 8 Three years or less 8,787 12,752 11,391 11,844 16,818 10,336 8,791 10,657 12,920 14,808 18,005 12,158 9 More than three years but less than or equal to six years 6,270 10,444 10,878 9,738 11,206 11,438 7,708 10,259 16,878 12,099 10,144 10,521 10 More than six years but less than or equal to eleven years .... 5,976 6,839 5,875 6,852 5,337 4,550 7,782 5,445 7,257 6,421 6,523 8,810 11 More than eleven years 897 988 1,071 941 761 585 2,009 936 1,209 1,682 2,080 1,562 12 Mortgage-backed 153,693 201,113 204,993 152,512 165,350 254,910 181,176 177,764 255,368 331,055 244,537 178,466 Corporate securities 13 One year or less 101,904 109,068 111,264 103,376 105,468 104,604 118,895 115,302 111,252 114,411 134,411 131,158 14 More than one year 15,482 22,404 22,114 26,287 23,318 24,000 18,873 20,942 25,006 22,763 22,755 24,629 By type of counterparty With interdealer broker 15 U.S. Treasury 137,745 170,999 176,738 164,015 183,940 189,323 156,672 170,636 189,860 180,503 216,547 186,003 16 Federal agency and governmentsponsored enterprises 7,381 10,127 8,572 10,233 8,541 8,885 7,844 7,883 11,012 11,927 10,722 9,462 17 Mortgage-backed 36,156 54,576 61,573 50,663 52,743 75,820 54,089 52,611 76,573 95,373 66,280 50,576 18 Corporate 433 616 518 661 714 553 368 466 571 491 508 438 With other 19 U.S. Treasury 162,512 205,741 202,410 189,245 185,617 204,218 185,828 214,685 225,560 214,724 238,269 207,092 20 Federal agency and governmentsponsored enterprises 69,496 77,652 76,975 70,884 83,390 72,229 79,595 70,814 89,383 71,108 78,389 74,680 21 Mortgage-backed 117,537 146,537 143,420 101,849 112,607 179,089 127,088 125,153 178,795 235,682 178,257 127,890 22 Corporate 116,953 130,855 132,860 129,002 128,072 128,051 137,400 135,779 135,686 136,683 156,659 155,349 NOTE. Major changes in the report form filed by primary dealers induced a break in the backed, and corporate securities scheduled for immediate and forward delivery, as well as all dealer data series as of the week ending July 4, 2001. Current weekly data may be found at the U.S. government securities traded on a when-issued basis between the announcement and Federal Reserve Bank of New York web site (http:www.newyorkfed.org/pihome/statistics) issue date. Data do not include transactions under repurchase and reverse repurchase (resale) under the Primary Dealer heading. agreements. Averages are based on the number of trading days in the week. 1. The figures represent purchases and sales in the market by the primary U.S. government 2. Outright Treasury inflation-indexed securities (TIIS) transactions are reported at princisecurities dealers reporting to the Federal Reserve Bank of New York. Outright transactions pal value, excluding accrued interest, where principal value reflects the original issuance par include all U.S. government, federal agency, government-sponsored enterprise, mortgage- amount (unadjusted for inflation) times the price times the index ratio. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A27 1.43 U.S. GOVERNMENT SECURITIES DEALERS Positions and Financing1 Millions of dollars 2002 2003 2003, week ending IItteemm,, bbyy ttyyppee ooff sseeccuurriittyy Dec. Jan. Feb. Jan. 29 Feb. 5 Feb. 12 Feb. 19 Feb. 26 Mar. 5 Mar. 12 Mar. 19 Net outright positions2 1 U.S. Treasury bills 27,911 23,749 33,405 15,946 24,171 31,778 40,149 33,634 37,774 32,292 33,102 Treasury coupon securities by maturity 2 Three years or less -22,860 -19,950 -13,349 -9,703 -16,436 -18,025 -15,372 -6,260 -6,990 -8,469 -10,028 3 More than three years but less than or equal to six years -33,784 -33,546 -30,605 -38,614 -34,042 -27,510 -29,391 -32,269 -31,268 -39,565 -39,506 4 More than six but less than or equal to eleven years -19,587 -18,697 -13,246 -19,813 -18,197 -13,268 -13,100 -10,904 -9,498 -10,332 -13,214 5 More than eleven 1,813 4,522 4,742 4,250 3,759 3,220 5,155 6,311 5,590 5,516 5,149 6 Inflation-indexed 4,312 1,268 2,051 2,028 1,038 2,222 2,071 2,579 2,061 2,129 4,311 Federal agency and governmentsponsored enterprises 7 Discount notes 51,664 55,562 56,067 61,236 63,066 57,514 54,573 52,802 50,166 58,724 55,307 Coupon securities, by maturity 8 Three years or less 18,834 15,969 18,206 15,243 15,827 19,734 16,576 18,996 21,747 22,456 17,704 9 More than three years but less than or equal to six years 587 4,501 7,076 5,459 7,812 9,268 6,025 5,693 6,077 5,260 3,534 10 More than six but less than or equal to eleven years 2,333 1,521 1,050 1,107 1,236 207 822 2,067 772 2,603 1,929 11 More than eleven 2,757 2,200 2,261 1,982 1,958 2,095 2,203 2,764 2,047 2,155 2,312 12 Mortgage-backed 12,650 23,387 27,290 33,740 32,996 28,681 21,290 27,640 27,936 42,411 56,549 Corporate securities 13 One year or less 25,588 25,810 26,844 26,498 30,987 25,718 30,300 22,472 23,636 29,370 29,121 14 More than one year 55,865 53,119 49,821 50,787 48,978 48,276 53,681 48,618 48,034 49,194 47,979 Financing3 Securities in, US. Treasury 15 Overnight and continuing 605,390 629,534 649,602 618,617 631,268 641,428 673,773 640,907 669,879 654,221 652,287 16 Term 918,379 716,731 711,711 770,564 773,324 798,446 622,685 674,260 696,777 764,308 820,208 Federal agency and governmentsponsored enterprises 17 Overnight and continuing 143,451 153,105 156,551 154,502 156,371 159,292 162,395 145,606 165,262 160,000 153,089 18 Term 294,633 228,176 225,453 232,573 230,380 231,468 216,628 224,279 227,073 241,547 243,799 Mortgage-backed securities 19 Overnight and continuing 35,872 37,003 41,472 29,138 33,821 37,946 51,364 41,305 38,898 40,349 42,962 20 Term 274,185 250,974 245,796 257,452 243,508 248,270 242,632 247,302 248,663 254,179 247,333 Corporate securities 21 Overnight and continuing 49,163 58,162 61,227 58,759 60,079 60,680 61,367 61,624 64,131 64,944 65,444 22 Term 24,654 24,045 24,535 23,645 24,887 24,964 24,702 23,828 24,050 25,734 26,348 MEMO Reverse repurchase agreements 23 Overnight and continuing 440,006 425,659 462,703 415,652 427,199 446,710 492,350 464,148 498,615 471,861 474,899 24 Term 1,352,627 1,058,223 1,044,314 1,119,107 1,109,413 1,140,885 943,789 1,003,613 1,037,862 1,116,675 1,159,906 Securities out, U.S. Treasury 25 Overnight and continuing 585,423 586,166 613,713 582,617 577,312 593,721 633,936 629,509 648,614 645,755 638,807 26 Term 842,700 656,962 651,391 702,113 714,152 742,013 564,162 607,052 637,794 699,428 749,705 Federal agency and governmentsponsored enterprises 27 Overnight and continuing 271,376 293,172 302,426 308,888 313,538 310,052 301,736 288,437 299,330 299,162 286,430 28 Term 232,535 153,444 156,795 150,466 155,138 160,989 149,215 160,068 161,331 178,431 178,090 Mortgage-backed securities 29 Overnight and continuing 300,834 334,095 336,090 367,868 316,794 307,924 363,780 355,400 318,414 304,619 352,761 30 Term 170,735 153,932 149,392 149,285 147,341 152,537 146,900 150,735 147,537 154,136 152,773 Corporate securities 31 Overnight and continuing 135,776 135,890 138,581 135,480 142,755 137,209 143,942 133,079 133,442 143,199 145,255 32 Term 17,694 19,581 22,083 20,537 21,002 22,395 22,240 22,244 22,575 22,434 22,146 MEMO Repurchase agreements 33 Overnight and continuing 1,127,804 1,159,110 1,190,429 1,200,763 1,156,305 1,149,294 1,238,659 1,207,695 1,190,472 1,193,494 1,229,711 34 Term 1,233,261 951,521 944,456 986,973 1,003,848 1,043,656 846,904 902,992 935,330 1,013,969 1,050,480 NOTE. Major changes in the report form filed by primary dealers included a break in many 2. Net outright positions include all U.S. government, federal agency, governmentseries as of the week ending July 4, 2001. Current weekly data may be found at the Federal sponsored enterprise, mortgage-backed, and corporate securities scheduled for immediate and Reserve Bank of New York web site (http://www.newyorkfed.org/pihome/statistics) under the forward delivery, as well as U.S. government securities traded on a when-issued basis Primary Dealer heading. between the announcement and issue date. 1. Data for positions and financing are obtained from reports submitted to the Federal 3. Figures cover financing U.S. government, federal agency, government-sponsored enter- Reserve Bank of New York by the U.S. government securities dealers on its published list of prise, mortgage-backed, and corporate securities. Financing transactions for Treasury primary dealers. Weekly figures are close-of-business Wednesday data. Positions for calendar inflation-indexed securities (TIIS) are reported in actual funds paid or received, except for days of the report week are assumed to be constant. Monthly averages are based on the pledged securities. TIIS that are issued as pledged securities are reported at par value, which number of calendar days in the month. is the value of the security at original issuance (unadjusted for inflation). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A28 Domestic NonfinancialS tatistics • June 2003 1.44 FEDERAL AND FEDERALLY SPONSORED CREDIT AGENCIES Debt Outstanding Millions of dollars, end of period 2002 2003 AAggeennccyy 11999999 22000000 22000011 22000022 Sept. Oct. Nov. Dec. Jan. 1 Federal and federally sponsored agencies 1,616,492 1,851,632 2,121,057 2,351,039 2,269,256 2,289,622 2,305,945 2,351,039 n.a. 2 Federal agencies 26,376 25,666 276 2 304 318 342 2 n.a. 3 Defense Department1 6 6 6 6 6 6 6 6 n.a. 4 Export-Import Bank2 3 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 5 Federal Housing Administration4 126 255 26,828 26,828 27,170 26,725 26,863 26,828 n.a. 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 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 8 Tennessee Valley Authority 26,370 25,660 270 270 298 312 336 270 n.a. 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 1,590,116 1,825,966 2,120,781 2,351,037 2,268,952 2,289,304 2,305,607 2,351,037 n.a. 11 Federal Home Loan Banks 529,005 594,404 623,740 674,841 668,703 679,209 674,847 674,841 n.a. 12 Federal Home Loan Mortgage Corporation 360,711 426,899 565,071 648,894 623,267 625,328 643,201 648,894 n.a. 13 Federal National Mortgage Association 547,619 642,700 763,500 851,000 800,300 804,800 811,700 851,000 n.a. 14 Farm Credit Banks8 68,883 74,181 76,673 85,088 82,741 83,145 83,884 85,088 n.a. 15 Student Loan Marketing Association9 41,988 45,375 48,350 47,900 50,800 54,200 48,700 47,900 n.a. 16 Financing Corporation 8,170 8,170 8,170 8,170 8,170 8,170 8,170 8,170 n.a. 17 Farm Credit Financial Assistance Corporation" 1,261 1,261 1,261 1,261 1,261 1,261 1,261 1,261 n.a. 18 Resolution Funding Corporation'2 29,996 29,996 29,996 29,996 29,996 29,996 29,996 29,996 n.a. MEMO 19 Federal Financing Bank debt13 42,152 40,575 39,096 37,017 39,604 37,084 37,418 37,017 n.a. Lending to federal and federally sponsored agencies 20 Export-Import Bank3 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 21 Postal Service6 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 22 Student Loan Marketing Association n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 23 Tennessee Valley Authority n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 24 United States Railway Association6 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. Other lending14 25 Fanners Home Administration 6,665 5,275 n.a. n.a. n.a. n.a. n.a. n.a. n.a. 26 Rural Electrification Administration 14,085 13,126 13,876 14,489 14,029 14,058 14,209 14,489 n.a. 27 Other 21,402 22,174 25,220 22,528 25,575 23,026 23,209 22,528 n.a. 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 claims. Once issued, these securities may be sold privately on the securities market. Reform, Recovery, and Enforcement Act of 1989, undertook its first borrowing in October 5. Certificates of participation issued before fiscal year 1969 by the Government National 1989. Mortgage Association acting as trustee for the Fanners Home Administration; the Department 13. The FFB, which began operations in 1974, is authorized to purchase or sell obligations of Health, Education, and Welfare; the Department of Housing and Urban Development; the issued, sold, or guaranteed by other federal agencies. Because FFB incurs debt solely for the Small Business Administration; and the Veterans Administration. purpose of lending to other agencies, its debt is not included in the main portion of the table to 6. Off-budget. avoid double counting. 7. Includes outstanding noncontingent liabilities: notes, bonds, and debentures. Includes 14. Includes FFB purchases of agency assets and guaranteed loans; the latter are loans Federal Agriculture Mortgage Corporation; therefore, details do not sum to total. Some data guaranteed by numerous agencies, with the amounts guaranteed by any one agency generally are estimated. being small. The Fanners Home Administration entry consists exclusively of agency assets, 8. Excludes borrowing by the Farm Credit Financial Assistance Corporation, which is whereas the Rural Electrification Administration entry consists of both agency assets and shown on line 17. guaranteed loans. 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 A29 1.45 NEW SECURITY ISSUES State and Local Governments Millions of dollars 2002 2003 TTyyppee ooff iissssuuee oorr iissssuueerr,, oorr uussee 22000000 22000011 22000022 Aug. Sept. Oct. Nov. Dec. Jan. Feb/ Mar. 1 All issues, new and refunding1 180,403 291,958r 364,044r 31,690r 27,423r 44,574 37,150r 27,593r 26,798r 30,009 28,327 By type of issue 2 General obligation 64,475 118,554 145,323 13,187 9,628 18,595 11,023 8,431 8,112 12,718 10,027 3 Revenue 115,928 170,047 214,788 18,692 17,751 24,074 24,942 18,961 17,049 17,291 18,300 By type of issuer 4 State 19,944 30,099 33,931 3,472 2,442 4,199 2,109 1,670 1,927 3,654 1,277 5 Special district or statutory authority2 121,185 197,462 259,070 23,104 19,171 31,793 28,296 20,151 17,979 20,738 20,061 6 Municipality, county, or township 39,273 61,040 67,121 5,302 5,767 6,678 5,570 5,570 5,290 5,617 6,989 7 Issues for new capital 154,257 200,343r 243,437r 20,632 15,139r 30,230 26,513r 19,944r 18,671r 20,252 16,647 By use of proceeds 8 Education 38,665 50,054 57,894 3,968 3,529 5,209 3,743 5,292 4,823 6,830 5,442 9 Transportation 19,730 21,411 22,093 4,413 1,398 1,476 1,250 1,060 1,417 1,618 1,208 10 Utilities and conservation 11,917 21,917 33,404 2,806 2,038 6,922 8,379 2,031 2,196 173 557 11 Social welfare n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 12 Industrial aid 7,122 6,607 7,227 283 574 1,225 821 796 422 1,075 1,681 13 Other purposes 47,309 55,733 73,033 6,537 5,597 6,996 7,189 4,992 7,400 7,421 4,378 1. Par amounts of long-term issues based on date of sale. SOURCE. Securities Data Company beginning January 1990; Investment Dealer's Digest 2. Includes school districts. before then. 1.46 NEW SECURITY ISSUES U.S. Corporations Millions of dollars 2002 2003 TTyyppee ooff iissssuuee,, ooffffeerriinngg,, oorr iissssuueerr 22000000 22000011'' 22000022 July Aug. Sept. Oct. Nov. Dec. Jan.' Feb. 1 All issues' 943,340r 1,382,534 l,262,684r 59,058r 88,222' 118,947' 82,729r 105,754r 107,916r 109,628 113,772 2 Bonds2 808,423r 1,253,980 l,152,249r 54,544r 84,216r lll,652r 74,896r 95,821r 101,038r 102,501 106,633 By type of offering 3 Sold in the United States 685,626' 1,197,591 1,066,003' 51,182' 80,772' 107,219' 70,699' 90,207' 95,187' 96,275 97,383 4 Sold abroad 122,798 56,389 86,246 3,362 3,444 4,432 4,197 5,614 5,851 6,226 9,250 MEMO 5 Private placements, domestic 18,370 16,385 16,224 0 0 65 0 3,525 5,060 200 0 By industry group 6 Nonfinancial 243,099' 446,456 267,258' 7,432' 14,407' 17,121' 14,560' 20,500' 19,614' 27,119 26,222 7 Financial 565,324' 807,524 884,991' 47,112' 69,809' 94,531' 60,336' 75,321' 81,424' 75,382 80,411 8 Stocks3 311,941 230,632 170,673 4,514 4,006 7,295 7,833 9,933 6,878 7,127 7,139 By type of offering 9 Public 134,917 128,554 110,435 4,514 4,006 7,295 7,833 9,933 6,878 7,127 7,139 10 Private placement4 177,024 102,078 60,238 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. By industry group 11 Nonfinancial 118,369 77,577 62,115 1,833 539 2,754 3,731 4,533 4,154 3,793 2,679 12 Financial 16,548 50,977 48,320 2,681 3,467 4,541 4,102 5,400 2,724 3,334 4,460 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 for private placements are not available at a monthly frequency. end, intracorporate transactions, Yankee bonds, and private placements listed. Stock data SOURCE. Securities Data Company and the Board of Governors of the Federal Reserve include ownership securities issued by limited partnerships. System. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A30 DomesticN onfinancial Statistics • June 2003 1.47 OPEN-END INVESTMENT COMPANIES Net Sales and Assets1 Millions of dollars 2002 2003 IItteemm 22000011 22000022 Aug. Sept. Oct. Nov. Dec. Jan. Feb.' Mar. 1 Sales of own shares2 1,806,474 1,826,045 151,136 125,408 164,959 137,914 134,383 152,647 122,321 141,679 2 Redemptions of own shares 1,677,266 1,702,671 136,210 126,760 167,039 122,125 135,213 138,951 113,643 129,798 3 Net sales3 129,208 123,374 14,926 -1,352 -2,080 15,789 -830 13,696 8,678 11,881 4 Assets4 4,689,624 4,119,322 4,170,641 3,899,858 4,059,765 4,249,351 4,119,322 4,060,568 4,031,818 4,060,954 5 Cash5 219,620 208,479 220,425 199,778 204,019 219,213 208,479 212,792 199,546 209,838 6 Other 4,470,004 3,910,843 3,950,216 3,700,080 3,855,746 4,030,138 3,910,843 3,847,776 3,832,272 3,851,116 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. 1.51 DOMESTIC FINANCE COMPANIES Assets and Liabilities1 Billions of dollars, end of period; not seasonally adjusted 2001 2002 2003 AAccccoouunntt 22000000'' 22000011'' 22000022'' Q3' Q4' Ql' Q2' Q3' Q4' Ql ASSETS 1 Accounts receivable, gross2 958.7 948.3 945.4 967.8 948.3 930.0 941.9 945.6 945.4 934.8 2 Consumer 328.0 340.1 315.6 329.3 340.1 329.8 332.0 334.5 315.6 307.0 3 Business 458.4 447.0 455.3 451.1 447.0 443.0 449.4 445.5 455.3 453.9 4 Real estate 172.3 161.3 174.5 187.4 161.3 157.2 160.5 165.5 174.5 174.0 5 LESS: Reserves for unearned income 69.7 60.6 57.0 60.8 60.6 59.5 58.5 58.0 57.0 54.2 6 Reserves for losses 16.7 21.0 23.8 18.0 21.0 21.5 21.6 22.0 23.8 24.0 7 Accounts receivable, net 872.3 866.7 864.5 889.0 866.7 849.0 861.9 865.6 864.5 856.7 8 All other 461.5 523.4 584.7 478.7 523.4 515.2 530.6 558.0 584.7 610.9 9 Total assets 1,333.7 1,390.1 1,449.3 1,367.7 1,390.1 1364.2 1,392.5 1,423.6 1,449.3 1,467.6 LIABILITIES AND CAPITAL 10 Bank loans 35.9 50.8 48.0 44.5 50.8 49.4 56.9 74.9 48.0 47.3 11 Commercial paper 238.8 158.6 141.5 171.0 158.6 137.0 130.8 143.1 141.5 127.3 Debt 12 Owed to parent 102.5 99.2 88.2 91.7 99.2 82.6 83.3 82.9 88.2 87.7 13 Not elsewhere classified 502.2 567.4 624.9 555.8 567.4 574.4 597.2 584.9 624.9 639.1 14 All other liabilities 301.8 325.5 339.0 327.6 325.5 329.1 331.5 343.4 339.0 344.4 15 Capital, surplus, and undivided profits 152.5 188.6 207.6 177.2 188.6 191.7 192.9 194.5 207.6 221.8 16 Total liabilities and capital 1,333.7 1,390.1 1,449.3 1,367.7 1,390.1 1,364.2 1,392.5 1,423.6 1,449.3 1,467.6 1. Includes finance company subsidiaries of bank holding companies but not of retailers 2. Before deduction for unearned income and losses. Excludes pools of securitized assets, 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 Markets and Corporate Finance A31 1.52 DOMESTIC FINANCE COMPANIES Owned and Managed Receivables1 Billions of dollars, amounts outstanding 2002 2003 TTyyppee ooff ccrreeddiitt 22000000 22000011 22000022 Sept. Oct. Nov. Dec. Jan. Feb. Seasonally adjusted 1 Total l,185.5r l,246.6r l,270.2r l,267.0r l,266.3r l,270.2r l,270.2r l,274.9r 1,274.1 2 Consumer 464.4r 513.3' 513.1' 522.9' 517.5' 513.7' 513.1' 518.0' 512.0 3 Real estate 198.9 207.7 216.5 207.9 211.7 214.2 216.5 215.2' 215.3 4 Business . 522.3 525.6 540.6 536.2 537.0 542.3 540.6 541.7' 546.9 Not seasonally adjusted 5 Total l,192.1r l,253.7r l,277.6r l,260.7r 1,263.4' l,267.9r l,277.6r l,277.5r 1,274.4 6 Consumer 468.3' 518.1' 518.4' 522.8' 518.8' 517.6' 518.4' 519.3' 512.2 7 Motor vehicle loans 141.6 173.9 160.2 176.5 169.9 159.8 160.2 160.2' 162.3 8 Motor vehicle leases 108.2 103.5 83.3 88.5 86.7 85.2 83.3 81.9 80.3 9 Revolving2 37.6' 31.5' 38.9' 37.3' 37.4' 37.0' 38.9' 39.5' 38.8 10 Other3 40.7 31.1 33.1 32.3 31.3 31.4 33.1 33.1' 32.6 Securitized assets4 11 Motor vehicle loans 97.1 131.9 151.9 138.9 144.1 153.9 151.9 154.3 148.7 12 Motor vehicle leases 6.6 6.8 5.7 6.0 5.9 5.8 5.7 5.7 5.6 13 Revolving 19.6 25.0 31.1 29.1 29.2 30.2 31.1 30.4 30.1 14 Other 17.1 14.3 14.0 14.4 14.4 14.2 14.0 14.2 13.8 15 Real estate 198.9 207.7 216.5 207.9 211.7 214.2 216.5 215.2' 215.3 16 One- to four-family 130.6 120.1 135.0 126.5 130.5 132.8 135.0 134.1' 134.3 17 Other 41.7 41.2 39.5 39.0 39.0 39.3 39.5 39.4 39.6 Securitized real estate assets4 18 One- to four-family 24.7 40.7 39.7 40.1 40.1 39.9 39.7 39.4 39.1 19 Other 1.9 5.7 2.2 2.2 2.2 2.2 2.2 2.2 2.2 20 Business 525.0 527.9 542.7 530.0 532.9 536.1 542.7 543.0' 546.9 21 Motor vehicles 75.5 54.0 60.7 56.9 57.3 58.2 60.7 58.6 62.6 22 Retail loans 18.3 16.1 15.4 17.6 18.0 15.7 15.4 15.2 16.2 23 Wholesale loans5 39.7 20.3 29.3 23.3 23.5 26.7 29.3 27.5 30.6 24 Leases 17.6 17.6 16.0 15.9 15.9 15.8 16.0 15.9 15.8 25 Equipment 283.5 289.4 292.1 289.2 288.4 288.4 292.1 293.4' 294.5 26 Loans 70.2 77.8 83.3 82.8 81.9 82.2 83.3 SLC 82.0 27 Leases 213.3 211.6 208.8 206.4 206.5 206.2 208.8 212.5' 212.5 28 Other business receivables6 99.4 103.5 102.5 99.4 97.0 95.7 102.5 103.4' 102.2 Securitized assets4 29 Motor vehicles 37.8 50.1 50.2 43.8 47.0 50.4 50.2 50.3 50.9 30 Retail loans 3.2 5.1 2.4 2.2 1.9 2.5 2.4 2.4 2.3 31 Wholesale loans 32.5 42.5 45.9 39.3 42.8 45.6 45.9 46.1 46.8 32 Leases 2.2 2.5 1.9 2.3 2.3 2.3 1.9 1.8 1.8 33 Equipment 23.1 23.2 20.2 21.6 23.9 24.3 20.2 20.1 19.4 34 Loans 15.5 16.4 13.0 14.8 17.2 17.6 13.0 12.9 12.3 35 Leases 7.6 6.8 7.2 6.7 6.7 6.7 7.2 7.2 7.1 36 Other business receivables6 5.6 7.7 17.1 19.1 19.2 19.2 17.1 17.1 17.3 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 subsidibreakdowns have been obtained for some components. In addition, previously unavailable aries 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

A32 Domestic Nonfinancial Statistics • June 2003 1.53 MORTGAGE MARKETS Mortgages on New Homes Millions of dollars except as noted 2002 2003 Sept. Oct. Nov. Dec. Jan. Feb. Mar. Terms and yields in primary and secondary markets PRIMARY MARKETS Terms1 1 Purchase price (thousands of dollars) 234.5 245.0 261.1 266.7 258.7 256.7 266.9 278.9 235.1 252.9 2 Amount of loan (thousands of dollars) 177.0 184.2 197.0 201.1 195.0 193.3 205.1 214.0 179.3 184.2 3 Loan-to-price ratio (percent) 77.4 77.3 77.8 77.6 77.7 77.4 79.0 79.3 78.0 76.2 4 Maturity (years) 29.2 28.8 28.9 29.1 28.8 28.4 28.7 28.9 28.3 28.2 5 Fees and charges (percent of loan amount)2 .70 .67 .62 .60 .63 .61 .64 .79 .37 .40 Yield (percent per year) 6 Contract rate1 7.41 6.90 6.35 6.09 6.00 5.99 5.95 6.00 5.76 5.69 7 Effective rate1-3 7.52 7.00 6.44 6.17 6.09 6.08 6.04 6.12 5.82 5.75 8 Contract rate (HUD series)4 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. SECONDARY MARKETS Yield (percent per year) 9 FHA mortgages (section 203)5 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 10 GNMA securities6 7.57 6.36 5.81 5.15 5.31 5.29 5.17 5.18 5.03 4.94 Activity in secondary markets FEDERAL NATIONAL MORTGAGE ASSOCIATION Mortgage holdings (end of period) 11 Total 610,122 707,015 790,800 751,423 751,347 760,759 790,800 810,609 816,747 815,964 12 FHA/VA insured 61,539 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 13 Conventional 548,583 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 14 Mortgage transactions purchased (during period) 154,231 270,384 370,641 33,518 32,853 47,807 67,891 57,281 40,420 34,304 Mortgage commitments (during period) 15 Issued7 163,689 304,084 400,327 58.055 68,463 53,286 30,769 n.a. n.a. n.a. 16 To sell8 11,786 7,586 12,268 1,016 1,121 520 1,555 n.a. n.a. n.a. FEDERAL HOME LOAN MORTGAGE CORPORATION Mortgage holdings (end of period f 17 Total 385,693 491,719 568,173 530,694 536,389 549,380 568,173 568,494 561,534 569,522 18 FHA/VA insured 3,332 3,506 4,573 4,634 4,724 4,019 4,573 n.a. n.a. n.a. 19 Conventional 382,361 488,213 563,600 526,060 531,665 545,361 563,600 n.a. n.a. n.a. Mortgage transactions (during period) 20 Purchases 174,043 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 21 Sales 166,901 389,611 547.046 46,369 60,516 62,354 73,184 48,169 41,831 59,065 22 Mortgage commitments contracted (during period)9 169,231 417,434 620,981 57,793 73,639 74,340 91,223 n.a. n.a. 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 the Federal 5. Average gross yield on thirty-year, minimum-downpayment first mortgages insured by National Mortgage Association exclude swap activity. 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 A3 3 1.54 MORTGAGE DEBT OUTSTANDING1 Millions of dollars, end of period 2001 2002 TTyyppee ooff hhoollddeerr aanndd pprrooppeerrttyy 11999999 22000000 22000011 Q4 Qi Q2 Q3 Q4P 1 All holders 6,320,135 6,894,097 7,597,732 7,597,732 7,763,084 7,978,272 8,209,225 8,476,304 By type of property 2 One- to four-family residences 4,790,601 5,208,604 5,738,228 5,738,228 5,876,695 6,048,445 6,245,941 6,459,659 3 Multifamily residences 369,003 405,430 453,100 453,100 461,198 472,262 479,919 496,733 4 Nonfarm, nonresidential 1,057,568 1,171,205 1,290,069 1,290,069 1,307,076 1,337,136 1,359,812 1,394,692 5 Farm 102,964 108,858 116,336 116,336 118,116 120,428 123,553 125,220 By type of holder 6 Major financial institutions 2,394,271 2,618,969 2,791,076 2,791,076 2,789,654 2,860,853 2,981,236 3,087,646 7 Commercial banks2 1,495,420 1,660,054 1,789,819 1,789,819 1,800,362 1,873,203 1,961,908 2,059,079 8 One- to four-family 879,576 965,635 1,023,851 1,023,851 1,018,478 1,070,522 1,143,938 1,222,461 9 Multifamily 67,665 77,803 84,851 84,851 86,719 90,743 90,929 94,169 10 Nonfarm, nonresidential 516,333 582,577 645,619 645,619 659,187 674,972 689,288 704,454 11 Farm 31,846 34,039 35,498 35,498 35,978 36,966 37,753 37,995 12 Savings institutions3 668,064 722,974 758,236 758,236 745,998 742,732 773,689 781,255 13 One- to four-family 548,222 594,221 620,579 620,579 605,171 599,402 625,424 631,399 14 Multifamily 59,309 61,258 64,592 64,592 65,199 66,009 68,668 67,840 15 Nonfarm, nonresidential 60,063 66,965 72,534 72,534 75,077 76,768 79,036 81,435 16 Farm 470 529 531 531 551 552 560 581 17 Life insurance companies 230,787 235,941 243,021 243,021 243,293 244,918 245,639 247,312 18 One- to four-family 5,934 4,903 4,931 4,931 4,938 5,162 5,176 5,210 19 Multifamily 32,818 33,681 35,631 35,631 35,671 35,818 35,921 36,161 20 Nonfarm, nonresidential 179,048 183,757 188,376 188,376 188,599 189,850 190,398 191,666 21 Farm 12,987 13,600 14,083 14,083 14,085 14,088 14,144 14,275 22 Federal and related agencies 320,054 344,225 376,999 376,999 385,027 396,091 412,014 437,100 23 Government National Mortgage Association 7 6 8 8 8 8 8 5 24 One- to four-family 7 6 8 8 8 8 8 5 25 Multifamily 0 0 0 0 0 0 0 0 26 Farmers Home Administration4 73,871 73,323 72,452 72,452 72,362 71,970 72,030 72,377 27 One- to four-family 16,506 16,372 15,824 15,824 15,665 15,273 15,139 14,908 28 Multifamily 11,741 11,733 11,712 11,712 11,707 11,692 11,686 11,669 29 Nonfarm, nonresidential 41,355 41,070 40,965 40,965 41,134 41,188 41,439 42,101 30 Farm 4,268 4,148 3,952 3,952 3,855 3,817 3,766 3,700 31 Federal Housing Admin, and Dept. of Veterans Affairs 3,712 3,507 3,290 3,290 3,361 3,473 2,973 3,854 32 One- to four-family 1,851 1,308 1,260 1,260 1,255 1,254 1,252 1,262 33 Multifamily 1,861 2,199 2,031 2,031 2,105 2,218 1,721 2,592 34 Resolution Trust Corporation 0 0 0 0 0 0 0 0 35 One- to four-family 0 0 0 0 0 0 0 0 36 Multifamily 0 0 0 0 0 0 0 0 37 Nonfarm, nonresidential 0 0 0 0 0 0 0 0 38 Farm 0 0 0 0 0 0 0 0 39 Federal Deposit Insurance Corporation 152 45 13 13 7 22 13 46 40 One- to four-family 25 7 2 2 1 4 2 7 41 Multifamily 29 9 3 3 1 4 2 9 42 Nonfarm, nonresidential 98 29 8 8 4 14 8 30 43 Farm 0 0 0 0 0 0 0 0 44 Federal National Mortgage Association 149,422 155,626 169,908 169,908 176,051 180,491 184,191 190,501 45 One- to four-family 141,195 144,150 155,060 155,060 160,300 164,038 167,006 171,490 46 Multifamily 8,227 11,476 14,848 14,848 15,751 16,453 17,185 19,011 47 Federal Land Banks 34,187 36,326 40,885 40,885 41,981 42,951 44,782 45,863 48 One- to four-family 2,012 2,137 2,406 2,406 2,470 2,527 2,635 2,699 49 Farm 32,175 34,189 38,479 38,479 39,511 40,424 42,147 43,164 50 Federal Home Loan Mortgage Corporation 56,676 59,240 62,792 62,792 59,624 58,872 60,934 63,887 51 One- to four-family 44,321 42,871 40,309 40,309 35,955 34,062 34,616 35,851 52 Multifamily 12,355 16,369 22,483 22,483 23,669 24,810 26,318 28,036 53 Mortgage pools or trusts5 2,947,690 3,231,401 3,714,706 3,714,706 3,869,374 3,986,827 4,065,965 4,182,833 54 Government National Mortgage Association 582,263 611,553 591,368 591,368 587,204 583,745 567,428 537,927 55 One- to four-family 565,189 592,624 569,460 569,460 564,108 559,549 542,250 512,137 56 Multifamily 17,074 18,929 21,908 21,908 23,096 24,196 25,178 25,790 57 Federal Home Loan Mortgage Corporation 749,081 822,310 948,409 948,409 1,012,478 1,053,261 1,058,176 1,082,062 58 One- to four-family 744,619 816,602 940,933 940,933 1,005,136 1,045,981 1,050,899 1,072,990 59 Multifamily 4,462 5,708 7,476 7,476 7,342 7,280 7,277 9,072 60 Federal National Mortgage Association 960,883 1,057,750 1,290,351 1,290,351 1,355,404 1,404,594 1,458,945 1,538,287 61 One- to four-family 924,941 1,016,398 1,238,125 1,238,125 1,301,374 1,349,442 1,402,929 1,478,610 62 Multifamily 35,942 41,352 52,226 52,226 54,030 55,152 56,016 59,677 63 Farmers Home Administration4 0 0 0 0 0 0 0 0 64 One- to four-family 0 0 0 0 0 0 0 0 65 Multifamily 0 0 0 0 0 0 0 0 66 Nonfarm, nonresidential 0 0 0 0 0 0 0 0 67 Farm 0 0 0 0 0 0 0 0 68 Private mortgage conduits 655,463 739,788 884,578 884,578 914,288 945,227 981,416 1,024,557 69 One- to four-family6 455,021 499,834 591,200 591,200 616,300 638,300 669,300 694,800 70 Multifamily 42,045 48,894 56,591 56,591 57,339 58,783 59,446 62,987 71 Nonfarm, nonresidential 158,398 191,060 236,787 236,787 240,649 248,144 252,669 266,770 72 Farm 0 0 0 0 0 0 0 0 73 Individuals and others7 658,120 699,503 714,950 714,950 719,029 734,502 750,010 768,724 74 One- to four-family 459,385 495,605 506,786 506,786 514,043 524,741 538,393 555,356 75 Multifamily 75,244 75,799 78,593 78,593 78,426 78,979 79,462 79,627 76 Nonfarm, nonresidential 102,274 105,747 105,780 105,780 102,425 106,201 106,973 108,237 77 Farm 21,217 22,352 23,792 23,792 24,135 24,581 25,183 25,504 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

A34 Domestic NonfinancialS tatistics • June 2003 1.55 CONSUMER CREDIT1 Millions of dollars, amounts outstanding, end of period 2002 2003 HHoollddeerr aanndd ttyyppee ooff ccrreeddiitt 22000000 22000011 22000022 Sept. Oct. Nov. Dec. Jan.r Feb. Seasonally adjusted 11 TToottaall 1,559,532r 1,666,816 l,726,420r 1,726,912 1,727,992 1,725,125 l,726,420r 1,740,694 1,742,280 22 RReevvoollvviinngg 667,395r 701,285 712,418r 717,653 717,279 716,376 712,418r 716,322 720,486 33 NNoonnrreevvoollvviinngg22 892,137 965,531 1,014,002 1,009,260 1,010,713 1,008,749 1,014,002 1,024,372 1,021,794 Not seasonally adjusted 4 Total l,593,116r 1,701,856 l,762,282r 1,721,809 1,727,420 1,735,697 l,762,282r 1,755,691 1,741,278 By major holder 5 Commercial banks 541,470 558,421 587,355 575,730 577,428 580,385 587,355 581,900 581,175 6 Finance companies 219,848' 236,559 232,269 246,072 238,571 228,241 232,269 232,827 233,677 / Credit unions 184,434 189,570 195,744 195,884 197,072 196,807 195,744 195,164 194,183 8 Savings institutions 64,557 69,070 68,591 65,094 66,272 67,413 68,591 67,635 66,678 9 Nonfinancial business 82,662 67,955 56,912 49,170 49,075 49,812 56,912 52,892 49,629 10 Pools of securitized assets3 500,145 580,281 621,411' 589,859 599,003 613,040 621,411' 625,274 615,935 By major type of credit* 11 Revolving 693,020' 727,297 738,425' 711,670 710,701 717,668 738,425' 727,791 720,706 12 Commercial banks 218,063 224,878 231,449 226,193 224,897 226,237 231,449 221,401 219,977 13 Finance companies 37,627' 31,538 38,948 37,280 37,351 37,015' 38,948 39,477 38,764 14 Credit unions 22,226 22,265 22,228 21,304 21,119 21,260 22,228 21,645 21,157 15 Savings institutions 16,560 17,767 16,193 14,758 15,242 15,710 16,193 15,811 15,429 16 Nonfinancial business 42,430 29,790 19,221 14,129 14,100 14,315 19,221 16,547 14,203 17 Pools of securitized assets3 356,114 401,059 410,385' 398,005 397,992 403,132 410,385' 412,911 411,177 18 Nonrevolving 900,095 974,559 1,023,858 1,010,139 1,016,719 1,018,029 1,023,858 1,027,900 1,020,572 19 Commercial banks 323,407 333,543 355,906 349,537 352,531 354,148 355,906 360,499 361,199 20 Finance companies 182,221 205,021 193,321 208,792 201,219 191,226 193,321 193,350 194,913 21 Credit unions 162,208 167,305 173,516 174,580 175,953 175,547 173,516 173,519 173,026 22 Savings institutions 47,997 51,303 52,398 50,335 51,031 51,703 52,398 51,824 51,249 23 Nonfinancial business 40,232 38,165 37,691 35,041 34,975 35,497 37,691 36,346 35,425 24 Pools of securitized assets3 144,031 179,222 211,026 191,854 201,011 209,908 211,026 212,363 204,759 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, excluding loans secured by real estate. Data in this table also appear are no longer carried on the balance sheets of the loan originator. in the Board's G.19 (421) monthly statistical release. For ordering address, see inside front 4. Totals include estimates for certain holders for which only consumer credit totals are cover. available. 2. Comprises motor vehicle loans, mobile home loans, and all other loans that are not 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 2002 2003 IItteemm 22000000 22000011 22000022 Aug. Sept. Oct. Nov. Dec. Jan. Feb. INTEREST RATES Commercial banks2 1 48-month new car 9.34 8.50 6.71 5.95 n.a. n.a. 5.67 n.a. n.a. 7.11 2 24-month personal 13.90 13.22 11.59 11.28 n.a. n.a. 10.78 n.a. n.a. 11.62 Credit card plan 3 All accounts 15.71 14.89 13.42 13.37 n.a. n.a. 13.13 n.a. n.a. 13.20 4 Accounts assessed interest 14.91 14.44 13.09 13.26 n.a. n.a. 12.78 n.a. n.a. 12.85 Auto finance companies 5 New car 6.61 5.65 4.29 2.17 2.29 2.62 3.41 3.50 3.13 3.99 6 Used car 13.55 12.18 10.74 10.46 10.44 10.59 10.70 10.48 10.37 10.43 OTHER TERMS3 Maturity (months) 1 New car 54.9 55.1 56.8 59.2 58.4 57.4 57.2 57.5 58.5 59.2 8 Used car 57.0 57.5 57.5 57.6 57.5 57.4 56.9 56.7 57.5 57.7 Loan-to-value ratio 9 New car 92 91 94 97 97 96 95 96 96 97 10 Used car 99 100 100 100 100 101 100 100 100 99 Amount financed (dollars) 11 New car 20,923 22,822 24,747 26,455 26,331 26,099 26,104 26,647 26,443 24,864 12 Used car 14,058 14,416 14,532 14,679 14,801 14,702 14,610 14,639 14,499 14,231 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 5 1.57 FUNDS RAISED IN U.S. CREDIT MARKETS1 Billions of dollars; quarterly data at seasonally adjusted annual rates 2001 2002 TTrraannssaaccttiioonn ccaatteeggoorryy oorr sseeccttoorr Q2 Q3 Q4 Ql Q2 Q3 Q4 Nonfinancial sectors 1 Total net borrowing by domestic nonfinancial sectors . . 789.9 1,046.2 1,031.6 840.9 1,125.9 1,082.6 1,285.8 1,193.0 966.2 1,627.6 1,298.0 1,563.2 By sector and instrument 7 Federal government 23.1 -52.6 -71.2 -295.9 -5.6 -215.8 209.3 43.4 39.8 526.0 265.7 198.5 Treasury securities 23.2 -54.6 -71.0 -294.9 -5.0 -216.9 209.7 44.2 41.6 524.2 264.2 198.1 4 Budget agency securities and mortgages -.1 2.0 -.2 -1.0 -.5 1.1 -.4 -.7 -1.8 1.8 1.6 .4 5 Nonfederal 766.8 1,098.8 1,102.8 1,136.8 1,131.5 1,298.4 1,076.4 1,149.5 926.4 1,101.6 1,032.3 1,364.7 By instrument 6 Commercial paper 13.7 24.4 37.4 48.1 -88.3 -133.4 -66.1 45.5 -144.4 -81.7 -17.4 -13.2 7 Municipal securities and loans 56.9 84.2 54.4 23.6 119.2 132.4 80.4 170.0 74.6 195.4 156.9 224.9 8 Corporate bonds 150.5 235.2 217.8 161.3 340.5 444.5 191.4 325.0 253.7 191.4 -29.1 116.8 9 Bank loans n.e.c 106.4 108.2 82.8 101.7 -82.7 -125.1 -24.3 -166.0 -17.2 -192.8 -125.0 -33.6 in Other loans and advances 59.5 82.1 46.0 95.0 29.3 132.3 59.4 -107.3 -19.2 77.2 77.6 4.0 ii Mortgages 322.3 489.8 564.9 568.2 704.7 767.5 770.2 733.0 696.6 831.3 911.3 1,064.8 i? Home 258.3 387.7 424.6 418.4 530.9 608.3 560.0 531.1 601.3 657.3 778.7 854.7 n Multifamily residential 7.3 23.4 35.7 34.0 47.9 40.8 56.5 56.5 29.3 44.4 29.5 63.3 14 Commercial 53.5 72.2 98.8 109.2 118.4 106.5 146.7 138.6 59.2 120.6 90.1 140.2 is Farm 3.1 6.5 5.8 6.5 7.5 11.9 7.0 6.8 6.9 9.1 13.1 6.5 16 Consumer credit 57.5 75.0 99.5 139.0 108.8 80.2 65.4 149.4 82.3 80.8 57.9 1.0 By borrowing sector 17 Household 332.7 454.8 498.0 546.0 611.8 661.4 656.9 621.7 704.9 684.1 755.7 883.1 18 Nonfinancial business 392.5 576.3 566.3 575.4 417.6 520.6 352.6 390.2 154.9 234.8 132.6 285.0 19 Corporate 291.6 408.6 378.5 380.4 253.3 339.1 194.4 240.8 39.3 93.6 -10.5 125.8 70 Nonfarm noncorporate 94.7 159.7 182.4 184.1 156.8 170.1 153.8 141.1 110.3 132.7 128.8 155.2 71 Farm 6.2 8.0 5.5 10.9 7.5 11.5 4.4 8.3 5.3 8.5 14.2 4.0 22 State and local government 41.5 67.7 38.5 15.5 102.2 116.5 67.0 137.6 66.6 182.7 144.0 196.5 73 Foreign net borrowing in United States 71.8 43.2 25.2 65.7 -37.4 -50.5 -106.7 16.0 77.3 15.1 -32.1 29.6 74 Commercial paper 3.7 7.8 16.3 31.7 -14.2 -3.8 -25.2 5.9 66.8 36.5 3.9 37.3 75 Bonds 61.4 34.9 14.1 23.9 -12.1 -15.8 -83.9 29.7 -2.3 -41.0 -22.5 -1.0 76 Bank loans n.e.c 8.5 6.6 .5 11.4 -7.3 -31.4 4.2 -16.3 13.9 22.0 -11.7 -2.8 27 Other loans and advances -1.8 -6.0 -5.7 -1.3 -3.7 .5 -1.8 -3.3 -1.2 -2.4 -1.8 -3.9 28 Total domestic plus foreign 861.7 1,089.4 1,056.7 906.6 1,088.5 1,032.2 1,179.1 1,208.9 1,043.4 1,642.7 1,265.9 1,592.8 Financial sectors 29 Total net borrowing by financial sectors 662.2 1,087.2 1,073.3 809.0 958.5 828.2 1,113.5 976.5 869.8 870.0 852.1 1,097.7 By instrument 30 Federal government-related 212.9 470.9 592.0 433.5 629.3 674.6 818.4 591.8 691.1 487.8 420.9 642.5 31 Government-sponsored enterprise securities 98.4 278.3 318.2 234.1 290.8 268.3 326.2 306.5 191.3 141.7 249.1 347.6 32 Mortgage pool securities 114.6 192.6 273.8 199.4 338.5 406.2 492.2 285.3 499.8 346.1 171.8 294.9 33 Loans from U.S. government .0 .0 .0 .0 .0 .0 .0 .0 .0 .0 .0 .0 34 Private 449.3 616.3 481.3 375.5 329.2 153.7 295.1 384.7 178.7 382.2 431.2 455.2 35 Open market paper 166.7 161.0 176.2 127.7 -61.9 -77.9 -72.2 -13.6 -178.3 -109.1 84.3 -76.5 36 Corporate bonds 218.9 310.2 207.1 199.3 341.1 223.2 308.8 372.7 354.1 435.8 188.6 617.6 37 Bank loans n.e.c 13.3 30.1 -14.2 -.2 13.8 10.8 1.6 18.3 .2 31.9 82.3 -70.6 38 Other loans and advances 35.6 90.2 107.1 42.5 34.9 -18.7 58.8 8.9 -3.9 16.7 71.9 -17.2 39 Mortgages 14.9 24.8 5.1 6.2 1.3 16.2 -1.9 -1.6 6.6 7.0 4.1 1.9 By borrowing sector 40 Commercial banking 46.1 72.9 67.2 60.0 52.9 -10.5 39.7 44.1 24.3 13.3 62.2 93.5 41 Savings institutions 19.7 52.2 48.0 27.3 7.4 3.4 39.4 -68.6 -33.1 -12.1 37.1 -47.1 47 Credit unions .1 .6 2.2 .0 1.5 .8 1.5 4.4 2.4 2.0 3.1 .4 43 Life insurance companies .2 .7 .7 -.7 .6 .1 3.5 1.4 2.4 1.2 2.0 2.5 44 Government-sponsored enterprises 98.4 278.3 318.2 234.1 290.8 268.3 326.2 306.5 191.3 141.7 249.1 347.6 45 Federally related mortgage pools 114.6 192.6 273.8 199.4 338.5 406.2 492.2 285.3 499.8 346.1 171.8 294.9 46 Issuers of asset-backed securities (ABSs) 202.2 321.4 212.3 189.7 317.6 205.9 313.9 430.0 263.6 241.6 194.1 356.3 47 Finance companies 57.8 57.1 70.3 81.2 -.2 36.8 41.8 -25.3 -31.2 80.2 106.4 19.2 48 Mortgage companies -4.6 1.6 .2 .1 .7 .6 .8 .6 .8 .7 .7 .7 49 Real estate investment trusts (REITs) 39.6 62.7 6.3 2.7 2.5 10.5 -2.4 7.8 7.4 25.3 26.6 15.1 50 Brokers and dealers 8.1 7.2 -17.2 15.6 1.4 35.6 12.6 -18.9 -15.7 17.5 15.2 -24.1 51 Funding corporations 79.9 40.0 91.5 -.4 -55.2 -129.6 -155.7 9.1 —42.2 12.4 -16.4 38.7 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A36 DomesticN onfinancial Statistics • June 2003 1.57 FUNDS RAISED IN U.S. CREDIT MARKETS1—Continued Billions of dollars; quarterly data at seasonally adjusted annual rates 2001 2002 TTrraannssaaccttiioonn ccaatteeggoorryy oorr sseeccttoorr 11999977 11999988 11999999 22000000 22000011 Q2 Q3 Q4 Ql Q2 Q3 Q4 All sectors 52 Total net borrowing, all sectors 1,523.9 2,176.7 2,130.0 1,715.6 2,047.1 1,860.4 2,292.6 2,185.4 1,913.3 2,512.7 2,118.0 2,690.5 53 Open market paper 184.1 193.1 229.9 207.6 -164.4 -215.1 -163.5 37.8 -255.9 -154.3 70.8 -52.4 54 U.S. government securities 236.0 418.3 520.7 137.6 623.8 458.8 1,027.8 635.2 730.9 1,013.8 686.7 841.0 55 Municipal securities 56.9 84.2 54.4 23.6 119.2 132.4 80.4 170.0 74.6 195.4 156.9 224.9 56 Corporate and foreign bonds 430.8 580.2 439.1 384.4 669.5 651.9 416.3 727.4 605.5 586.2 136.9 733.4 57 Bank loans n.e.c 128.2 145.0 69.0 112.8 -76.2 -145.7 -18.5 -164.0 -3.0 -139.0 -54.3 -107.0 58 Other loans and advances 93.2 166.3 147.4 136.2 60.4 114.2 116.5 -101.8 -24.2 91.5 147.6 -17.2 59 Mortgages 337.2 514.6 570.0 574.4 706.0 783.8 768.2 731.4 703.1 838.3 915.4 1,066.7 60 Consumer credit 57.5 75.0 99.5 139.0 108.8 80.2 65.4 149.4 82.3 80.8 57.9 1.0 Funds raised through mutual funds and corporate equities 61 Total net issues 218.7 165.9 191.2 236.1 301.9 419.9 151.8 397.9 437.6 282.4 -77.1 271.6 62 Corporate equities ^16.4 -113.7 .0 1.1 100.5 146.4 -8.6 142.0 50.7 182.4 -114.2 66.7 63 Nonfinancial corporations -77.4 -215.5 -110.4 -118.2 ^17.4 -57.9 -108.6 -4.2 -8.0 17.9 -130.8 -39.9 64 Foreign shares purchased by U.S. residents 57.6 101.3 114.3 103.6 106.8 222.9 43.5 74.7 -5.9 79.7 -50.6 52.7 65 Financial corporations -26.6 .6 ^1.0 15.7 41.1 -18.6 56.5 71.5 64.6 84.8 67.3 54.0 66 Mutual fund shares 265.1 279.5 191.2 235.0 201.4 273.5 160.4 255.9 386.9 100.0 37.1 204.9 1. Data in this table also appear in the Board's Z. 1 (780) quarterly statistical release, tables F.2 through F4. For ordering address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Flow of Funds A37 1.58 SUMMARY OF FINANCIAL TRANSACTIONS1 Billions of dollars except as noted; quarterly data at seasonally adjusted annual rates 2001 2002 TTrraannssaaccttiioonn ccaatteeggoorryy oorr sseeccttoorr 11999977 11999988 11999999 22000000 22000011 Q2 Q3 Q4 Ql Q2 Q3 Q4 NET LENDING IN CREDIT MARKETS2 1 Total net lending in credit markets 1,523.9 2,176.7 2,130.0 1,715.6 2,047.1 1,860.4 2,292.6 2,185.4 1,913.3 2,512.7 2,118.0 2,690.5 7 Domestic nonfederal nonfinancial sectors 15.4 259.1 227.3 -116.6 -24.1 -117.2 70.5 92.5 155.9 272.5 -240.2 150.2 Household 25.3 127.3 217.3 -140.6 -52.7 -101.1 53.8 18.2 101.3 223.4 -250.4 148.6 4 Nonfinancial corporate business -12.7 -16.0 -15.6 23.4 -11.5 -29.5 -44.5 29.9 52.3 3.2 -5.5 -41.3 .5 Nonfarm noncorporate business 2.6 13.3 -2.9 1.3 2.0 .3 3.3 2.0 3.3 3.3 -2.2 -1.0 6 State and local governments .1 134.5 28.4 -.8 38.1 13.1 57.9 42.4 -1.1 42.5 17.8 43.8 7 Federal government 5.1 13.5 5.8 7.3 6.0 9.4 3.3 7.0 4.7 8.8 6.8 10.3 8 Rest of the world 259.6 172.5 139.7 225.9 320.6 254.9 269.2 432.5 171.8 542.6 450.0 503.0 9 Financial sectors 1,243.9 1,731.6 1,757.2 1,599.0 1,744.6 1,713.4 1,949.6 1,653.4 1,580.9 1,688.8 1,901.4 2,027.0 10 Monetary authority 38.3 21.1 25.7 33.7 39.9 26.9 8.4 85.1 81.6 43.4 67.3 118.7 11 Commercial banking 324.3 305.6 312.2 357.9 205.2 107.8 267.9 314.6 188.9 384.3 624.0 442.6 12 U.S.-chartered banks 274.9 312.1 318.6 339.5 191.6 156.5 242.5 275.0 168.2 343.8 599.9 462.8 13 Foreign banking offices in United States 40.2 -11.6 -17.0 23.9 -.6 -50.1 21.1 -7.8 2.1 33.7 21.8 -31.3 14 Bank holding companies 5.4 -.9 6.2 -12.2 4.2 -2.8 -1.4 13.6 12.0 1.9 -1.6 .2 15 Banks in U.S.-affiliated areas 3.7 6.0 4.4 6.7 10.0 4.2 5.7 33.9 6.6 4.9 4.0 10.9 16 Savings institutions -4.7 36.2 677 56.2 42.8 55.8 -4.7 73.1 12.3 -23.5 79.7 73.4 17 Credit unions 16.8 18.9 27.5 28.0 41.5 9.6 61.1 60.5 58.3 41.1 39.9 37.3 18 Bank personal trusts and estates -25.0 -12.8 27.8 .8 -28.1 -28.1 -28.0 -28.1 1.0 .9 .8 .8 19 Life insurance companies 104.8 76.9 53.5 57.9 130.9 143.6 186.9 81.3 260.6 175.1 267.6 156.1 7.0 Other insurance companies 25.2 5.8 -3.0 -87 9.0 .1 5.1 28.5 36.7 35.4 21.7 28.2 21 Private pension funds 47.6 -23.4 17.0 33.4 20.3 44.7 10.4 5.3 27.4 46.2 35.9 14.4 22 State and local government retirement funds 67.1 72.1 46.9 54.6 -17.7 77.0 -74.2 -2.7 70.5 -54.5 -10.4 9.4 23 Money market mutual funds 87.5 244.0 182.0 143.0 246.0 245.3 311.8 49.1 -241.3 -86.7 -74.4 301.2 74 Mutual funds 80.9 127.3 48.4 21.0 126.0 169.1 102.7 139.3 243.3 41.9 162.7 128.9 75 Closed-end funds -2.9 5.2 8.2 -6.3 7.1 -4.9 23.9 16.6 21.6 -.4 -3.3 -1.8 26 Government-sponsored enterprises 106.3 314.0 291.3 256.4 309.0 297.2 274.3 335.3 236.7 129.0 204.4 319.5 27 Federally related mortgage pools 114.6 192.6 273.8 199.4 338.5 406.2 492.2 285.3 499.8 346.1 171.8 294.9 78 Asset-backed securities issuers (ABSs) 163.8 281.7 194.1 159.9 291.4 177.6 288.3 407.3 239.4 219.4 171.5 334.5 29 Finance companies 23.1 77.3 97.0 108.0 -5.7 112.1 -43.3 -100.5 -28.2 39.6 80.0 -21.2 30 Mortgage companies -9.1 3.2 .3 .2 1.4 1.1 1.7 1.2 1.6 1.4 1.5 1.5 31 Real estate investment trusts (REITs) 20.2 -5.1 -2.6 -6.3 6.7 1.1 7.8 14.0 26.3 31.8 27.6 8.1 32 Brokers and dealers 14.9 6.8 -34.7 68.9 92.4 53.4 184.5 -110.5 -219.5 402.8 -208.6 147.5 33 Funding corporations 50.4 -15.8 124.0 41.0 -112.2 -182.3 -127.4 -1.2 63.7 -84.5 226.6 -366.9 RELATION OF LIABILITIES TO FINANCIAL ASSETS 34 Net flows through credit markets 1,523.9 2,176.7 2,130.0 1,715.6 2,047.1 1,860.4 2,292.6 2,185.4 1,913.3 2,512.7 2,118.0 2,690.5 Other financial sources 35 Official foreign exchange .7 6.6 -8.7 -.4 4.3 4.7 13.7 .2 -3.0 12.9 24.6 4.9 36 Special drawing rights certificates -.5 .0 -3.0 -4.0 .0 .0 .0 .0 .0 .0 .0 .0 37 Treasury currency .5 .6 1.0 2.4 1.3 1.3 2.2 .0 .9 .6 2.4 .0 38 Foreign deposits 107.7 6.5 61.0 135.1 28.0 -175.9 41.5 17.9 -59.1 53.3 687 122.1 39 Net interbank transactions -19.7 -31.8 15.0 15.1 -31.7 -25.4 -1.1 41.5 12.9 -164.6 59.0 118.2 40 Checkable deposits and currency 41.2 47.3 151.2 -71.4 204.3 151.4 215.0 278.1 -171.9 178.0 211.5 -36.1 41 Small time and savings deposits 97.1 152.4 45.1 188.8 267.2 242.1 230.3 329.7 259.7 249.0 327.6 272.9 47 Large time deposits 122.5 91.8 131.1 116.2 68.6 43.0 19.5 77.8 270.0 34.9 27.8 -110.1 43 Money market fund shares 155.9 287.2 249.1 233.3 428.6 370.0 386.1 379.8 -315.7 103.4 -192.6 337.6 44 Security repurchase agreements 120.9 91.3 169.8 113.2 22.3 117.8 212.7 -138.3 119.4 362.4 -91.1 -17.1 45 Corporate equities ^t6.4 -113.7 .0 1.1 100.5 146.4 -8.6 142.0 50.7 182.4 -114.2 66.7 46 Mutual fund shares 265.1 279.5 191.2 235.0 201.4 273.5 160.4 255.9 386.9 100.0 37.1 204.9 47 Trade payables 139.8 106.4 268.6 425.4 -67.3 -69.6 -185.8 -160.9 182.1 27.2 160.2 89.8 48 Security credit 111.0 103.2 104.4 146.1 3.1 -73.9 561.3 -383.7 -190.7 -131.9 -69.6 -13.1 49 Life insurance reserves 59.3 48.0 50.8 50.2 77.2 52.2 74.7 119.6 93.9 92.2 119.7 97.5 50 Pension fund reserves 201.4 217.4 181.8 209.0 208.4 209.1 180.3 148.2 137.0 145.5 317.2 236.7 51 Taxes payable 22.3 19.6 30.7 32.8 17.5 14.8 104.9 -54.8 3.6 40.4 48.5 23.4 52 Investment in bank personal trusts -53.0 -46.1 -8.1 56.6 -59.9 -62.2 -57.3 -57.7 -3.7 -2.4 -2.1 -1.3 53 Noncorporate proprietors' equity ^40.7 -57.8 -62.4 -11.5 -18.6 -26.4 -34.3 8.4 1.5 -32.9 -86.2 -33.7 54 Miscellaneous 456.7 889.0 1,036.3 1,413.5 774.6 974.1 935.6 317.6 207.1 640.1 942.1 528.1 55 Total financial sources 3,265.9 4,274.0 4,734.9 5,002.2 4,277.0 4,027.4 5,143.8 3,506.7 2,895.0 4,403.2 3,908.4 4,582.1 Liabilities not identified as assets (-) 56 Treasury currency -.2 -.1 -.7 -1.2 -.1 -.3 .9 .0 -1.5 -.9 1.1 -1.1 57 Foreign deposits 106.2 -8.5 42.6 55.9 11.1 -166.8 55.3 -27.5 -33.6 94.8 50.8 115.0 58 Net interbank liabilities -19.9 3.8 .1 20.4 17.2 17.0 7.4 22.6 39.8 -9.5 13.2 -17.0 59 Security repurchase agreements 63.2 57.7 35.7 122.6 -53.9 129.8 106.3 -166.2 157.9 224.3 -285.7 -24.7 60 Taxes payable 28.0 19.7 11.7 26.2 22.1 3.1 25.4 35.0 14.3 -52.3 16.2 -47.6 61 Miscellaneous -285.4 -226.9 -291.4 -370.5 -252.3 -480.5 37.0 -314.4 -300.9 33.8 98.3 53.1 Floats not included in assets (—) 62 Federal government checkable deposits -2.7 2.6 -7.4 9.0 5.7 60.9 -20.1 -91.8 15.1 77.1 -40.3 -51.7 63 Other checkable deposits -3.9 -3.1 -.8 1.7 4.5 3.9 5.0 5.7 6.1 7.1 7.6 8.4 64 Trade credit -25.5 -43.3 6.8 32.4 12.5 6.3 -28.3 50.5 -36.3 -92.8 -27.0 -39.5 65 Total identified to sectors as assets 3,406.0 4,472.0 4,938.4 5,105.8 4,510.2 4,453.8 4,955.0 3,992.9 3,033.9 4,121.7 4,074.1 4,587.3 1. Data in this table also appear in the Board's Z. 1 (780) quarterly statistical release, tables 2. Excludes corporate equities and mutual fund shares. F. 1 and F.5. For ordering address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A38 DomesticN onfinancial Statistics • June 2003 1.59 SUMMARY OF CREDIT MARKET DEBT OUTSTANDING1 Billions of dollars, end of period 2001 2002 Q2 Q3 Q4 Ql Q2 Q3 Q4 Nonfinancial sectors 1 Total credit market debt owed by domestic nonfinancial sectors 16,240.5 17306.8 18,166.8 19,293.3 18,600.5 18,918.3 19,293.3 19,533.3 19,848.3 20,179.3 20,657.1 By sector and instrument 2 Federal government 3,752.2 3,681.0 3,385.1 3,379.5 3,251.4 3,320.0 3,379.5 3,430.3 3,451.4 3,540.8 3,637.0 3 Treasury securities 3,723.7 3,652.7 3,357.8 3,352.7 3,224.3 3,293.0 3,352.7 3,404.0 3,424.6 3,513.6 3,609.8 4 Budget agency securities and mortgages 28.5 28.3 27.3 26.8 27.0 27.0 26.8 26.3 26.8 27.2 27.3 5 Nonfederal 12,488.4 13,625.8 14,781.7 15,913.8 15,349.1 15,598.3 15,913.8 16,103.0 16,396.9 16,638.5 17,020.0 By instrument 6 Commercial paper 193.0 230.3 278.4 190.1 223.3 201.3 190.1 167.5 148.4 142.2 126.0 / Municipal securities and loans 1,402.9 1,457.2 1,480.9 1,600.1 1,547.0 1,555.1 1,600.1 1,623.3 1,677.6 1,704.2 1,763.1 8 Corporate bonds 1,846.0 2,063.9 2,225.1 2,565.6 2,436.5 2,484.4 2,565.6 2,629.0 2,676.9 2,669.6 2,698.8 9 Bank loans n.e.c 1,148.6 1,231.4 1,333.1 1,251.0 1,293.6 1,285.1 1,251.0 1,237.3 1,192.1 1,159.1 1,158.8 10 Other loans and advances 907.2 953.5 1,059.6 1,088.8 1,103.6 1,110.1 1,088.8 1,089.6 1,106.0 1,116.9 1,123.7 11 Mortgages 5,644.1 6,243.4 6,811.6 7,516.3 7,136.9 7,333.1 7,516.3 7,679.1 7,894.6 8,125.5 8,392.3 12 Home 4,366.0 4,790.6 5,209.0 5,739.9 5,463.4 5,607.3 5,739.9 5,878.8 6,050.8 6,248.7 6,462.9 13 Multifamily residential 308.0 343.9 378.0 425.8 397.6 411.7 425.8 433.2 444.3 451.6 467.5 14 Commercial 873.6 1,006.5 1,115.8 1,234.2 1,162.9 1,199.6 1,234.2 1,249.0 1,279.1 1,301.6 1,336.7 IS Farm 96.6 102.3 108.9 116.3 113.0 114.6 116.3 118.1 120.4 123.6 125.2 16 Consumer credit 1,346.6 1,446.1 1,593.1 1,701.9 1,608.2 1,629.3 1,701.9 1,677.2 1,701.3 1,720.9 1,757.4 By borrowing sector 17 Households 6,011.8 6,510.0 7,075.1 7,686.8 7,322.8 7,493.5 7,686.8 7,802.1 7,987.8 8,183.3 8,443.8 18 Nonfinancial business 5,338.2 5,938.9 6,514.3 6,932.5 6,774.1 6,847.3 6,932.5 6,985.1 7,042.8 7,064.9 7,134.3 19 Corporate 3,790.6 4,203.5 4,583.9 4,837.8 4,755.4 4,790.5 4,837.8 4,863.2 4,883.0 4,871.0 4,899.8 20 Nonfarm noncorporate 1,383.7 1,566.1 1,750.2 1,907.0 1,833.5 1,870.8 1,907.0 1,934.7 1,968.0 1,999.0 2,038.7 21 Farm 163.9 169.4 180.2 187.7 185.2 185.9 187.7 187.1 191.8 194.9 195.7 22 State and local government 1,138.3 1,176.9 1,192.3 1,294.5 1,252.2 1,257.6 1,294.5 1,315.8 1,366.2 1,390.3 1,442.0 23 Foreign credit market debt held in United States 651.3 676.7 742.3 704.9 726.1 701.7 704.9 724.2 725.6 720.2 727.4 24 Commercial paper 72.9 89.2 120.9 106.7 110.1 106.3 106.7 123.6 130.2 134.0 142.8 2S Bonds 462.6 476.7 500.6 488.4 502.0 481.0 488.4 487.9 477.6 472.0 471.7 26 Bank loans n.e.c 58.7 59.2 70.5 63.2 66.2 67.3 63.2 66.7 72.2 69.3 68.6 27 Other loans and advances 57.1 51.6 50.3 46.6 47.7 47.0 46.6 46.0 45.5 44.9 44.2 28 Total credit market debt owed by nonfinancial sectors, domestic and foreign 16,891.8 17,983.5 18,909.1 19,998.2 19,326.6 19,620.0 19,998.2 20,257.5 20,573.8 20,899.5 21,384.4 Financial sectors 29 Total credit market debt owed by financial sectors 6,545.2 7,618.5 8,439.5 9,395.3 8,851.0 9,120.1 9,395.3 9,591.8 9,804.7 10,007.6 10,317.7 By instrument 30 Federal government-related 3,292.0 3,884.0 4,317.4 4,944.1 4,591.6 4,796.2 4,944.1 5,116.9 5,238.8 5,344.1 5,504.7 31 Government-sponsored enterprise securities .. . 1,273.6 1,591.7 1,825.8 2,114.0 1,955.8 2,037.4 2,114.0 2,161.8 2,197.2 2,259.5 2,346.4 32 Mortgage pool securities 2,018.4 2,292.2 2,491.6 2,830.1 2,635.7 2,758.8 2,830.1 2,955.1 3,041.6 3,084.5 3,158.3 33 Loans from U.S. government .0 .0 .0 .0 .0 .0 .0 .0 .0 .0 .0 34 Private 3,253.2 3,734.6 4,122.0 4,451.2 4,259.4 4,323.9 4,451.2 4,474.9 4,565.9 4,663.6 4,813.1 3S Open market paper 906.7 1,082.9 1,210.7 1,148.8 1,144.5 1,110.2 1,148.8 1,090.9 1,046.9 1,049.5 1,078.9 36 Corporate bonds 1,878.7 2,085.9 2,297.2 2,638.3 2,478.8 2,561.6 2,638.3 2,730.6 2,847.1 2,901.0 3,037.3 37 Bank loans n.e.c 107.5 93.2 93.0 106.8 100.4 100.2 106.8 105.1 113.5 133.3 117.7 38 Other loans and advances 288.7 395.8 438.3 473.2 450.7 467.2 473.2 462.4 470.8 491.2 490.0 39 Mortgages 71.6 76.7 82.9 84.2 85.1 84.6 84.2 85.9 87.6 88.6 89.1 By borrowing sector 40 Commercial banks 188.6 230.0 266.7 296.0 274.7 281.4 296.0 295.8 310.4 318.9 326.1 41 Bank holding companies 193.5 219.3 242.5 266.1 269.0 272.7 266.1 269.0 264.2 271.8 284.3 42 Savings institutions 212.4 260.4 287.7 295.1 294.4 305.6 295.1 280.5 275.3 286.4 281.3 43 Credit unions 1.1 3.4 3.4 4.9 3.5 3.8 4.9 5.5 6.0 6.8 6.9 44 Life insurance companies 2.5 3.2 2.5 3.1 1.9 2.8 3.1 3.7 4.0 4.5 5.1 4S Government-sponsored enterprises 1,273.6 1,591.7 1,825.8 2,114.0 1,955.8 2,037.4 2,114.0 2,161.8 2,197.2 2,259.5 2,346.4 46 Federally related mortgage pools 2,018.4 2,292.2 2,491.6 2,830.1 2,635.7 2,758.8 2,830.1 2,955.1 3,041.6 3,084.5 3,158.3 47 Issuers of asset-backed securities (ABSs) 1,398.0 1,610.3 1,812.0 2,129.5 1,937.3 2,019.1 2,129.5 2,187.7 2,249.6 2,301.5 2,393.5 48 Brokers and dealers 42.5 25.3 40.9 42.3 43.9 47.1 42.3 38.4 42.8 46.6 40.6 49 Finance companies 625.5 695.7 776.9 776.7 769.0 771.2 776.7 760.8 784.9 802.9 820.4 SO Mortgage companies 17.7 17.8 17.9 18.6 18.2 18.5 18.6 18.8 19.0 19.2 19.3 SI Real estate investment trusts (REITs) 158.8 165.1 167.8 170.2 168.9 168.3 170.2 172.1 178.4 185.1 188.8 52 Funding corporations 412.6 504.0 503.7 448.4 478.6 433.6 448.4 442.6 431.3 420.0 446.6 All sectors 53 Total credit market debt, domestic and foreign. 23,437.1 25,602.0 27,348.6 29,393.6 28,177.5 28,740.1 29,393.6 29,849.3 30,378.5 30,907.1 31,702.2 54 Open market paper 1,172.6 1,402.4 1,610.0 1,445.6 1,477.9 1,417.8 1,445.6 1,382.0 1,325.5 1,325.7 1,347.7 55 U.S. government securities 7,044.2 7,564.9 7,702.5 8,323.6 7,842.9 8,116.2 8,323.6 8,547.2 8,690.2 8,884.9 9,141.7 56 Municipal securities 1,402.9 1,457.2 1,480.9 1,600.1 1,547.0 1,555.1 1,600.1 1,623.3 1,677.6 1,704.2 1,763.1 57 Corporate and foreign bonds 4,187.4 4,626.4 5,022.9 5,692.3 5,417.3 5,527.0 5,692.3 5,847.5 6,001.6 6,042.6 6,207.8 58 Bank loans n.e.c 1,314.8 1,383.8 1,496.6 1,421.0 1,460.2 1,452.6 1,421.0 1,409.1 1,377.8 1,361.7 1,345.1 59 Other loans and advances 1,253.0 1,400.9 1,548.2 1,608.6 1,602.0 1,624.4 1,608.6 1,598.0 1,622.3 1,653.0 1,658.0 60 Mortgages 5,715.7 6,320.1 6,894.5 7,600.5 7,222.0 7,417.8 7,600.5 7,764.9 7,982.2 8,214.2 8,481.4 61 Consumer credit 1,346.6 1,446.1 1,593.1 1,701.9 1,608.2 1,629.3 1,701.9 1,677.2 1,701.3 1,720.9 1,757.4 1. Data in this table 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 2001 2002 TTrraannssaaccttiioonn ccaatteeggoorryy oorr sseeccttoorr 11999988 11999999 22000000 22000011 Q2 Q3 Q4 Qi Q2 Q3 Q4 CREDIT MARKET DEBT OUTSTANDING2 1 Total credit market assets 23,437.1 25,602.0 27,348.6 29,393.6 28,177.5 28,740.1 29,393.6 29,849.3 30,378.5 30,907.1 31,702.2 7 Domestic nonfederal nonfinancial sectors 3,312.6 3,600.8 3,455.5 3,417.8 3,366.5 3,359.6 3,417.8 3,442.6 3,498.9 3,417.2 3,502.3 Household 2,264.1 2,542.4 2,373.1 2,306.9 2,290.6 2,282.7 2,306.9 2,337.9 2,374.6 2,292.7 2,362.6 4 Nonfinancial corporate business 241.5 226.0 249.4 237.9 225.4 214.8 237.9 230.4 235.0 235.4 240.1 5 Nonfarm noncorporate business 67.5 64.6 65.9 67.9 66.6 67.4 67.9 68.7 69.6 69.0 68.8 6 State and local governments 739.4 767.8 767.0 805.1 784.0 794.6 805.1 805.6 819.7 820.1 830.9 7 Federal government 219.0 258.0 265.3 271.3 268.7 269.6 271.3 272.5 274.7 276.4 279.0 R Rest of the world 2,278.2 2,354.6 2,621.1 2,954.4 2,766.8 2,837.5 2,954.4 3,000.6 3,133.2 3,249.5 3,371.3 9 Financial sectors 17,627.3 19,388.7 21,006.7 22,750.1 21,775.4 22,273.4 22,750.1 23,133.5 23.471.8 23,964.0 24,549.6 10 Monetary authority 452.5 478.1 511.8 551.7 535.1 534.1 551.7 575.4 590.7 604.2 629.4 11 Commercial banking 4,336.1 4,648.3 5,006.3 5,210.5 5,041.5 5,100.6 5,210.5 5,231.3 5,328.3 5,476.2 5,620.5 1? U.S.-chartered banks 3,761.4 4,080.0 4,419.5 4,610.1 4,463.5 4,513.5 4,610.1 4,629.3 4,719.7 4,858.4 5,003.8 13 Foreign banking offices in United States 504.5 487.4 511.3 510.7 501.3 509.3 510.7 507.7 512.6 521.2 517.3 14 Bank holding companies 26.5 32.7 20.5 24.7 21.6 21.3 24.7 27.7 28.1 27.7 27.8 15 Banks in U.S.-affiliated areas 43.8 48.3 55.0 65.0 55.1 56.5 65.0 66.6 67.9 68.8 71.6 16 Savings institutions 964.7 1,032.4 1,088.6 1,131.4 1,116.1 1,118.1 1,131.4 1,134.7 1,130.9 1,153.7 1,166.9 17 Credit unions 324.2 351.7 379.7 421.2 392.4 408.4 421.2 434.3 447.7 458.5 465.3 18 Bank personal trusts and estates 194.1 222.0 222.8 194.7 208.8 201.8 194.7 195.0 195.2 195.4 195.6 19 Life insurance companies 1,828.0 1,886.0 1,943.9 2,074.8 2,004.8 2,054.8 2,074.8 2,136.9 2,180.1 2,250.7 2,289.6 7.0 Other insurance companies 521.1 518.2 509.4 518.4 510.0 511.3 518.4 527.6 536.4 541.9 548.9 71 Private pension funds 651.2 668.2 701.6 721.9 718.0 720.6 721.9 728.7 740.3 749.3 752.9 77 State and local government retirement funds 704.6 751.4 806.0 788.4 807.6 789.0 788.4 806.0 792.4 789.8 792.1 ?3 Money market mutual funds 965.9 1,147.8 1,290.9 1,536.9 1,414.3 1,494.9 1,536.9 1,496.4 1,419.3 1,405.7 1,511.6 74 Mutual funds 1,028.4 1,076.8 1,097.8 1,223.8 1,160.3 1,188.2 1,223.8 1,276.8 1,291.6 1,334.5 1,368.0 75 Closed-end funds 98.4 106.6 100.3 107.4 97.3 103.3 107.4 112.8 112.8 111.9 111.5 76 Government-sponsored enterprises 1,252.3 1,543.5 1,807.1 2,114.3 1,956.1 2,026.1 2,114.3 2,163.8 2,199.9 2,252.9 2,336.7 27 Federally related mortgage pools 2,018.4 2,292.2 2,491.6 2,830.1 2,635.7 2,758.8 2,830.1 2,955.1 3,041.6 3,084.5 3,158.3 28 Asset-backed securities (ABSs) issuers 1,219.4 1,413.6 1,585.4 1,876.8 1,696.6 1,772.1 1,876.8 1,928.9 1,985.3 2,031.5 2,118.1 7.9 Finance companies 645.5 742.5 850.5 844.8 878.5 859.5 844.8 832.4 845.6 857.1 862.4 30 Mortgage companies 35.3 35.6 35.9 37.2 36.5 36.9 37.2 37.6 38.0 38.3 38.7 31 Real estate investment trusts (REITs) 45.5 42.9 36.6 43.3 37.9 39.8 43.3 49.9 57.9 64.8 66.8 37 Brokers and dealers 189.4 154.7 223.6 316.0 288.4 366.4 316.0 299.6 352.6 335.2 346.6 33 Funding corporations 152.3 276.0 317.0 206.3 239.5 188.8 206.3 210.3 185.4 224.1 166.1 RELATION OF LIABILITIES TO FINANCIAL ASSETS 34 Total credit market debt 23,437.1 25,602.0 27,348.6 29,393.6 28,177.5 28,740.1 29,393.6 29,849.3 30,378.5 30,907.1 31,702.2 Other liabilities 35 Official foreign exchange 60.1 50.1 46.1 46.8 43.4 49.0 46.8 45.7 47.2 53.1 55.8 36 Special drawing rights certificates 9.2 6.2 2.2 2.2 2.2 2.2 2.2 2.2 2.2 2.2 2.2 37 Treasury currency 19.9 20.9 23.2 24.5 23.9 24.5 24.5 24.7 24.8 25.5 25.5 38 Foreign deposits 642.3 703.6 824.5 908.9 837.6 848.0 908.9 894.1 907.4 924.6 955.2 39 Net interbank liabilities 189.4 202.4 221.2 187.7 158.7 166.5 187.7 161.1 130.6 149.0 191.3 40 Checkable deposits and currency 1,333.3 1,484.5 1,413.1 1,603.2 1,449.6 1,487.1 1,603.2 1,525.2 1,571.0 1,610.7 1,648.6 41 Small time and savings deposits 2,626.5 2,671.6 2,860.4 3,127.6 2,992.4 3,047.6 3,127.6 3,229.6 3,257.6 3,339.0 3,404.9 42 Large time deposits 805.3 936.4 1,052.6 1,121.1 1,087.3 1,094.2 1,121.1 1,178.9 1,188.7 1,197.7 1,176.8 43 Money market fund shares 1,329.7 1,578.8 1,812.1 2,240.7 2,014.7 2,115.4 2,240.7 2,202.6 2,150.3 2,105.9 2,223.9 44 Security repurchase agreements 913.8 1,083.6 1,196.8 1,231.8 1,205.4 1,251.9 1,231.8 1,262.4 1,343.1 1,313.7 1,325.2 45 Mutual fund shares 3,613.1 4,538.5 4,434.6 4,135.5 4,259.5 3,753.1 4,135.5 4,247.0 3,926.6 3,452.3 3,634.6 46 Security credit 572.2 676.6 822.7 825.9 781.5 919.9 825.9 778.0 745.6 726.3 724.5 47 Life insurance reserves 718.3 783.9 819.1 880.0 840.3 844.0 880.0 904.2 915.2 927.9 958.4 48 Pension fund reserves 8,208.4 9,065.3 9,069.0 8,693.4 8,862.6 8,281.0 8,693.4 8,822.2 8,328.1 7,732.4 8,053.3 49 Trade payables 2,073.8 2,342.4 2,767.9 2,700.6 2,756.4 2,725.7 2,700.6 2,724.3 2,721.6 2,779.2 2,815.4 50 Taxes payable 170.7 201.4 234.2 251.7 241.2 270.1 251.7 258.9 265.0 279.6 280.7 51 Investment in bank personal trusts 1,001.0 1,130.4 1,095.8 960.7 1,024.6 916.5 960.7 963.2 893.5 811.6 840.9 52 Miscellaneous 7,617.2 8,499.5 9,717.2 10,505.4 10,491.8 10,919.8 10,505.4 10,539.1 10,829.7 11,304.4 11,394.1 53 Total liabilities 55341.1 61,578.0 65,761.2 68,841.3 67,250.6 67,456.6 68,841.3 69,612.6 69,626.9 69,642.2 71,413.3 Financial assets not included in liabilities (+) 54 Gold and special drawing rights 21.6 21.4 21.6 21.8 21.5 22.0 21.8 21.9 22.3 22.8 23.2 55 Corporate equities 15,577.3 19,581.2 17,611.9 15,245.5 16,281.6 13,673.4 15,245.5 15,264.1 13,363.0 10,960.1 11,734.5 56 Household equity in noncorporate business 4,285.7 4,523.1 4,753.2 4,837.2 4,817.0 4,865.2 4,837.2 4,864.4 4,933.7 4,983.6 5,021.8 Liabilities not identified as assets (-) 57 Treasury currency -6.4 -7.1 -8.5 -8.6 -8.8 -8.6 -8.6 -8.9 -9.1 -8.9 -9.1 58 Foreign deposits 542.8 585.7 627.4 694.9 631.6 645.4 694.9 686.5 710.2 722.9 751.7 59 Net interbank transactions -26.5 -28.5 -4.3 11.1 3.8 4.5 11.1 21.9 18.4 16.5 14.9 60 Security repurchase agreements 230.6 266.4 388.9 348.5 379.4 398.7 348.5 401.6 463.3 381.6 366.5 61 Taxes payable 121.2 129.4 146.3 121.8 150.5 167.3 121.8 109.9 162.8 152.8 156.8 62 Miscellaneous -1,972.7 -2,427.9 -2,902.8 -3,147.0 -2,806.3 -2,643.0 -3,147.0 -3,105.7 -3,140.6 -3,033.6 -3,036.1 Floats not included in assets (-) 63 Federal government checkable deposits -3.9 -9.8 -2.3 -12.3 -3.6 -4.0 -12.3 -9.6 -9.3 -14.8 -11.7 64 Other checkable deposits 23.1 22.3 24.0 28.6 25.5 19.2 28.6 26.3 31.4 25.8 35.9 65 Trade credit 84.8 95.6 128.0 140.5 61.8 52.0 140.5 85.7 33.0 25.5 91.6 66 Totals identified to sectors as assets 76,232.7 87,077.5 89,751.1 90,768.3 89,936.9 87,385.5 90,768.3 91,555.1 89,685.8 87,340.6 89,832.3 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

A40 Domestic Nonfinancial Statistics • June 2003 2.12 OUTPUT, CAPACITY, AND CAPACITY UTILIZATION1 Seasonally adjusted 2002 2003 2002 2003 2002 2003 Q2 Q3 Q4' Qi Q2 Q3 Q4 Ql Q2 Q3 Q4< Ql Output (1997=100) Capacity (percent of 1997 output) Capacity utilization rate (percent)2 1 Total industry 110.5 111.4 110.4 110.5 145.9 146.2 146.6 147.1 75.7 76.2 75.3 75.2 2 Manufacturing 111.4 112.3 111.2 111.0 150.9 151.1 151.4 151.7 73.9 74.3 73.5 73.2 3 Manufacturing (NAICS) 111.8 112.6 111.5 111.2 152.2 152.5 152.8 153.3 73.5 73.8 73.0 72.6 4 Durable manufacturing 121.2 122.3 121.4 121.5 172.5 173.4 174.2 175.1 70.2 70.5 69.7 69.4 5 Primary metal 85.6 85.9 86.0 84.4 112.0 111.4 110.8 110.7 76.4 77.1 77.6 76.2 6 Fabricated metal products 99.1 99.5 98.9 98.0 139.3 139.4 139.6 139.8 71.2 71.3 70.8 70.1 7 Machinery 88.6 88.7 86.7 86.7 129.9 129.9 129.9 129.8 68.2 68.3 66.7 66.8 8 Computer and electronic products 219.6 222.6 224.4 226.9 350.1 355.4 360.3 366.2 62.7 62.6 62.3 61.9 9 Electrical equipment, appliances, and components 98.3 97.7 96.8 96.3 129.1 128.6 128.2 128.1 76.1 75.9 75.5 75.2 10 Motor vehicles and parts 116.8 121.7 120.0 120.3 145.9 147.1 148.4 149.9 80.0 82.7 80.8 80.2 11 Aerospace and miscellaneous transportation equipment 87.6 85.9 85.1 86.0 145.5 145.3 145.1 145.1 60.2 59.1 58.7 59.3 12 Nondurable manufacturing 99.7 100.1 98.8 98.2 127.7 127.5 127.3 127.3 78.1 78.5 77.6 77.2 13 Food, beverage, and tobacco products .... 100.8 100.1 98.8 97.8 125.8 125.7 125.6 125.5 80.2 79.7 78.7 78.0 14 Textile and product mills 83.3 82.9 81.2 79.4 112.3 111.7 111.1 110.6 74.2 74.2 73.1 71.8 15 Paper 94.2 95.7 95.8 93.6 114.2 114.0 113.8 113.6 82.5 84.0 84.2 82.4 16 Petroleum and coal products 103.3 102.3 102.8 102.7 114.9 115.2 115.7 116.1 89.9 88.7 88.9 88.4 17 Chemical 105.3 106.4 104.1 104.4 141.2 141.2 141.3 141.5 74.6 75.3 73.7 73.8 18 Plastics and rubber products 106.6 107.3 105.6 105.0 134.2 133.6 132.9 132.5 79.4 80.4 79.4 79.2 19 Other manufacturing (non-NAICS) 104.6 106.0 106.0 106.5 130.3 129.5 128.7 128.3 80.3 81.8 82.3 83.0 20 Mining 93.4 93.5 93.7 94.2 110.2 110.1 110.2 110.3 84.8 84.9 85.1 85.4 21 Electric and gas utilities 110.2 112.5 111.5 114.3 125.5 127.6 129.7 131.5 87.8 88.2 86.0 86.9 MEMOS 22 Computers, communications equipment, and semiconductors 290.3 295.5 300.4 305.5 466.7 475.3 483.3 493.9 62.2 62.2 62.2 61.8 23 Total excluding computers, communications equipment, and semiconductors 100.6 101.3 100.3 100.3 130.4 130.5 130.6 130.9 77.1 77.6 76.8 76.6 24 Manufacturing excluding computers, communications equipment, and semiconductors 99.9 100.5 99.4 99.1 132.6 132.6 132.6 132.7 75.3 75.8 75.0 74.7 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Selected Measures A41 2.12 OUTPUT, CAPACITY, AND CAPACITY UTILIZATION1—Continued Seasonally adjusted 1973 1975 Previous cycle3 Latest cycle4 2002 2002 2003 SSeerriieess High Low High Low High Low Mar. Oct. Nov. Dec.' Jan.' Feb.' Mar.P Capacity utilization rate (percent)2 1 Total industry 88.8 74.0 86.6 70.8 85.1 78.6 75.3 75.5 75.6 74.9 75.4 75.3 74.8 2 Manufacturing 88.0 71.6 86.3 68.6 85.5 77.2 73.5 73.7 73.7 73.0 73.4 73.1 72.9 3 Manufacturing (NAICS) 88.1 71.4 86.3 67.9 85.5 77.0 73.1 73.1 73.3 72.5 72.9 72.5 72.3 4 Durable manufacturing 88.9 69.6 87.0 63.1 84.5 73.4 69.7 69.9 70.2 69.1 69.9 69.3 68.9 5 Primary metal 100.9 68.9 91.3 47.2 95.3 75.2 75.7 78.9 77.8 76.1 76.9 76.3 75.5 6 Fabricated metal products .... 91.8 69.6 83.1 61.7 80.1 71.0 70.5 71.5 70.7 70.4 70.6 70.0 69.7 7 Machinery 94.2 74.2 92.8 58.3 84.7 72.9 67.7 66.8 67.3 66.0 66.8 67.0 66.6 8 Computer and electronic products 87.0 66.9 89.8 77.3 81.5 76.4 62.7 62.5 62.3 62.0 62.2 61.8 61.8 9 Electrical equipment, appliances, and components 99.3 68.5 91.9 64.4 87.5 75.0 74.8 75.3 75.6 75.6 75.0 75.6 7744..99 10 Motor vehicles and parts 95.3 55.3 96.2 45.2 90.0 56.6 78.0 80.0 83.5 79.1 82.3 80.1 78.3 11 Aerospace and miscellaneous transportation equipment. 75.0 66.3 84.6 69.8 88.9 81.9 61.4 58.9 58.4 58.7 59.4 59.1 59.4 12 Nondurable manufacturing 87.5 72.5 85.7 75.6 86.9 81.8 77.8 77.8 77.7 77.2 77.2 77.1 77.1 13 Food, beverage, and tobacco products 85.9 78.0 84.3 80.2 85.5 81.3 80.6 79.2 78.5 78.3 78.4 77.7 77.7 14 Textile and product mills .... 89.8 62.8 90.1 72.3 91.1 77.1 73.7 73.0 73.5 72.8 71.7 71.9 71.8 15 Paper 97.4 74.7 95.6 81.3 94.0 85.4 80.0 84.1 85.1 83.5 82.5 82.2 82.4 16 Petroleum and coal products . . 93.2 81.0 92.3 71.1 88.9 82.5 90.2 86.1 89.8 90.7 88.1 88.4 88.7 17 Chemical 85.0 68.9 83.0 67.9 85.6 80.8 74.6 74.1 73.8 73.2 73.4 73.8 74.1 18 Plastics and rubber products . . 96.3 61.6 90.5 70.5 91.2 77.1 78.1 79.9 79.6 78.8 79.3 79.3 79.1 19 Other manufacturing (non-NAICS). 85.7 75.7 88.1 85.7 90.2 79.1 80.2 82.7 81.9 82.4 82.0 83.4 83.7 20 Mining 93.6 87.6 94.2 78.6 85.6 83.3 84.8 83.9 85.0 86.4 85.1 85.3 85.8 21 Electric and gas utilities 96.2 82.7 87.9 77.2 92.6 84.2 86.9 86.9 86.4 84.8 87.8 88.5 84.5 MEMOS 22 Computers, communications equipment, and semiconductors . 84.5 63.1 89.9 75.6 80.4 74.6 61.7 62.3 62.4 61.7 61.7 61.7 62.1 23 Total excluding computers, communications equipment, and semiconductors 89.1 74.3 86.6 70.5 85.5 78.8 76.7 76.9 77.0 76.4 76.9 76.8 76.2 24 Manufacturing excluding computers communications equipment, and semiconductors . 88.3 71.9 86.3 68.1 86.1 77.3 74.9 75.2 75.3 74.5 75.0 74.7 74.4 Note. The statistics in the G. 17 release cover output, capacity, and capacity utilization in the data are also available on the Board's web site http://www.federalreserve.gov/releases/gl7. industrial sector, which the Federal Reserve defines are manufacturing, mining, and electric The latest historical revision of the industrial production index and the capacity utilization and gas utilities. Manufacturing consists of those industries included in the North American rates was released in December 2002. The recent annual revision is described in the April Industry Classification System, or NAICS, manufacturing plus those industries—logging and 2003 issue of the Bulletin. newspaper, periodical, book, and directory publishing—that have traditionally been consid- 2. Capacity utilization is calculated as the ratio of the Federal Reserve's seasonally ered manufacturing and included in the industrial sector. adjusted index of industrial production to the corresponding index of capacity. 1. Data in this table also appear in the Board's G.17 (419) monthly statistical release. The 3. Monthly highs, 1978-80; monthly lows, 1982. 4. Monthly highs, 1988-89; monthly lows, 1990-91. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A42 Domestic Nonfinancial Statistics • June 2003 2.13 INDUSTRIAL PRODUCTION Indexes and Gross Value1 Monthly data seasonally adjusted 1992 2002 2003 roup pro- 2002 por- avg. tion Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec.r Jan.r Feb/ Mar.p Index(1997= 100) MAJOR MARKETS 1 Total IP 100.0 110.5 109.6 110.1 110.4 110.8 111.6 111.3 111.2 110.6 110.8 109.9 110.8 110.7 110.1 Market groups 2 Final products and nonindustrial supplies 60.8 109.3 108.9 109.1 109.3 109.6 110.1 109.8 109.8 109.1 109.3 108.2 109.2 109.1 108.6 3 Consumer goods 29.0 107.5 107.4 107.5 107.3 107.8 108.5 107.8 107.9 107.0 107.8 106.6 107.7 107.4 106.8 4 Durable 5.8 117.3 115,7 116.5 117.2 118.6 120.0 119.3 118.7 117.0 121.0 117.8 120.7 118.6 117.7 5 Automotive products 2.5 125.4 121.7 123.8 124.2 127.4 130.6 130.6 129.3 125.9 132.4 125.9 131.3 128.2 126.5 6 Home electronics 0.4 142.9 150.2 139.9 143.8 135.3 137.0 135.4 142.6 140.1 142.1 145.3 151.4 148.5 148.3 7 Appliances, furniture, carpeting 1.3 106.9 108.1 108.2 109.1 107.5 106.9 104.5 104.6 104.9 107.1 107.7 106.2 107.0 106.4 8 Miscellaneous goods 1.6 98.5 98.2 98.1 98.9 100.2 99.2 98.3 97.8 98.2 98.3 98.7 98.8 97.2 97.4 y Nondurable 23.2 104.1 104.4 104.4 103.9 104.1 104.6 103.8 104.2 103.6 103.3 102.8 103.4 103.5 103.1 10 Non-energy 20.2 102.6 103.5 102.8 102.2 102.8 102.8 102.4 102.6 102.0 101.3 100.8 101.0 100.9 101.1 ii Foods and tobacco 10.4 99.5 100.8 100.4 100.0 100.2 99.8 99.2 99.1 98.7 97.9 97.4 97.6 96.6 96.6 12 Clothing 2.4 72.4 74.4 72.7 72.9 72.9 73.2 71.3 72.1 70.2 70.6 69.9 69.7 69.7 68.6 13 Chemical products 4.6 119.1 120.1 118.5 116.8 118.3 119.5 119.0 119.5 118.3 118.0 116.9 117.5 118.8 119.4 14 Paper products 2.9 108.1 107.2 106.0 106.2 107.2 107.1 108.4 109.8 110.0 108.8 109.0 108.7 109.9 110.5 lb Energy 3.0 112.0 109.4 112.8 112.5 110.9 114.0 111.6 112.8 111.8 114.0 113.3 115.7 117.0 113.6 16 Business equipment 13.2 107.3 107.8 107.7 108.0 108.0 107.3 108.1 106.9 106.0 106.1 104.6 105.7 105.4 105.1 17 Transit 2.5 81.2 84.8 83.2 82.0 81.1 80.2 81.1 79.7 77.3 77.9 75.4 75.9 74.5 73.6 18 Information processing 5.4 153.8 155.5 154.7 154.9 154.9 153.5 153.7 152.1 153.1 152.8 152.7 155.1 154.4 156.1 19 Industrial and other 5.3 91.5 90.3 91.1 91.9 92.2 92.0 92.9 92.0 91.2 91.1 89.7 90.4 90.8 90.1 20 Defense and space equipment 3.4 101.2 99.8 99.9 100.6 101.2 101.2 101.9 102.0 102.5 101.7 102.3 104.1 104.1 104.5 21 Construction supplies 5.4 104.0 104.0 104.0 104.6 104.5 104.4 104.8 104.5 104.2 103.8 102.4 102.6 102.2 102.0 22 Business supplies 9.1 121.9 119.7 120.7 121.5 121.8 123.2 122.6 123.6 123.1 122.5 121.9 123.1 123.9 122.8 23 Materials 39.2 112.2 110.7 111.6 112.2 112.6 113.8 113.6 113.4 112.8 113.1 112.4 113.1 113.1 112.5 24 Non-energy 29.6 115.8 114.0 115.0 115.8 116.4 117.2 117.4 117.2 116.7 116.7 115.6 116.3 116.0 115.7 25 Durable 20.7 128.0 125.8 127.1 127.8 128.6 129.4 130.0 129.5 129.5 129.7 128.1 129.6 129.1 128.5 26 Consumer parts 4.0 110.8 109.2 110.8 110.1 110.4 113.4 112.3 112.4 111.7 114.6 111.1 114.4 112.4 110.6 21 Equipment parts 7.5 182.6 177.6 179.8 182.3 183.6 184.2 186.3 185.7 185.7 185.3 184.4 185.9 186.5 187.0 28 Other 9.2 97.1 96.0 96.7 97.2 97.9 97.7 98.3 97.7 98.0 97.2 96.4 96.8 96.7 96.3 29 Nondurable 8.9 97.0 95.9 96.5 97.3 97.6 98.4 98.2 98.3 97.1 97.0 96.5 96.2 96.1 96.2 30 Textile 1.1 77.6 77.7 77.8 78.2 78.5 79.6 77.8 78.4 77.2 77.0 75.3 75.7 74.8 74.4 31 Paper 1.8 94.8 91.9 93.3 94.8 93.6 95.8 96.1 96.7 96.8 96.9 95.8 95.0 94.7 94.6 32 Chemical 4.0 99.1 98.8 99.6 100.4 100.6 101.3 100.7 100.2 98.2 97.9 97.3 97.3 97.2 97.9 33 Energy 9.6 98.7 97.9 98.6 98.5 98.6 101.0 99.3 99.1 98.4 99.4 99.7 100.8 101.6 100.1 SPECIAL AGGREGATES 34 Total excluding computers, communication equipment, and semiconductors 94.7 100.5 99.9 100.3 100.5 100.8 101.5 101.2 101.2 100.5 100.6 99.8 100.6 100.5 99.9 35 Total excluding motor vehicles and parts 94.3 110.0 109.4 109.7 110.1 110.3 110.8 110.5 110.5 110.0 109.8 109.3 109.9 110.0 109.6 Gross value (billions of 1996 dollars, annual rates) 36 Final products and nonindustrial supplies 100.0 2,793.1 2,787.1 2,796.7 2,802.2 2,809.9 2,828.0 2,821.5 2,817.8 2,793.6 2,817.8 2,783.5 2,810.7 2,803.1 2,785.8 37 Final products 77.2 2,018.6 2,013.9 2,020.7 2,021.4 2,028.7 2,042.2 2,038.1 2,031.4 2,010.8 2,037.3 2,010.7 2,031.9 2,022.3 2,011.9 38 Consumer goods 51.9 1,384.6 1,380.1 1,386.3 1,384.8 1,390.2 1,404.1 1,395.9 1,394.3 1,379.1 1,402.0 1,384.1 1,399.6 1,391.6 1,383.5 39 Equipment total 25.3 624.9 625.4 625.3 628.1 629.9 627.9 633.6 627.7 622.6 624.4 615.8 621.1 620.1 618.1 40 Nonindustrial supplies 22.8 774.4 773.2 776.1 780.9 781.3 785.9 783.5 786.6 783.2 780.5 772.8 778.7 780.9 774.0 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Selected Measures A43 2.13 INDUSTRIAL PRODUCTION Indexes and Gross Value1—Continued Monthly data seasonally adjusted 1992 2002 2003 Group N c A od IC e2 S p p r o o r - - 2 a 0 v 0 g 2 . tion Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec.' Jan.' Feb.' Mar.p Index (1997= 100) INDUSTRY GROUPS 41 Manufacturing 85.4 111.4 110.7 111.0 111.4 111.9 112.3 112.4 112.1 111.4 111.6 110.6 111.3 111.0 110.8 42 Manufacturing (NAICS) 79.1 111.7 111.0 111.4 111.9 112.2 112.7 112.8 112.4 111.7 112.0 110.8 111.6 111.2 111.0 43 Durable manufacturing 43.0 121.1 119.8 120.5 121.2 121.8 122.2 122.7 122.0 121.5 122.2 120.5 122.1 121.4 120.9 44 Wood products ' ' 321 1.5 100.5 101.7 100.8 101.0 102.2 101.9 102.5 100.7 99.2 98.3 96.9 99.1 97.6 96.2 45 Nonmetallic mineral products 327 2.0 107.9 106.6 107.4 107.7 106.6 107.7 108.5 109.8 109.3 110.2 108.0 109.2 108.8 109.4 46 Primary metal 331 2.7 85.6 85.1 84.6 85.9 86.2 85.0 87.6 85.0 87.6 86.2 84.1 85.0 84.5 83.6 47 Fabricated metal products . 332 5.3 99.0 98.2 98.4 99.7 99.3 99.7 99.3 99.4 99.8 98.7 98.3 98.6 97.9 97.6 48 Machinery 333 5.7 87.9 88.0 88.3 88.5 88.9 88.4 89.4 88.2 86.8 87.4 85.8 86.8 87.0 86.4 49 Computer and electronic products 334 8.8 220.4 216.9 217.9 220.0 220.8 221.5 223.0 223.2 224.2 224.5 224.5 226.5 226.2 227.9 50 Electrical equipment, appliances, and components 335 2.5 97.7 96.8 97.2 98.9 98.7 98.4 98.0 96.5 96.6 97.0 96.9 96.1 96.9 95.9 51 Motor vehicles and parts . . 3361-3 5.7 117.3 113.3 115.9 115.8 118.6 122.1 122.0 121.1 118.3 123.9 117.8 123.0 120.1 117.8 52 Aerospace and miscellaneous transportation equipment 3364-9 4.5 87.6 89.5 88.3 87.6 86.9 85.7 86.3 85.7 85.5 84.8 85.2 86.1 85.8 86.1 53 Furniture and related products 337 1.5 101.3 101.7 101.8 101.5 101.6 101.4 100.5 101.4 100.7 100.6 98.9 99.4 100.3 99.2 54 Miscellaneous 339 2.8 109.5 107.4 109.6 110.2 110.7 110.6 110.2 109.1 109.3 108.6 110.0 109.4 109.3 109.9 55 Nondurable manufacturing .. 36.1 99.5 99.5 99.5 99.7 99.9 100.4 100.0 100.0 99.1 98.9 98.3 98.3 98.1 98.2 56 Food, beverage, and tobacco products .... 311,2 10.9 100.2 101.4 101.0 100.6 100.9 100.5 100.0 99.9 99.5 98.6 98.3 98.5 97.5 97.5 57 Textile and product mills . . 313,4 1.8 82.5 83.0 82.9 83.6 83.4 83.9 82.5 82.3 81.3 81.7 80.8 79.4 79.5 79.3 58 Apparel and leather 315,6 2.2 72.2 74.1 72.5 72.7 72.6 73.0 71.2 71.8 70.2 70.5 69.7 69.6 69.5 68.5 59 Paper 322 3.3 94.4 91.6 93.0 95.0 94.7 95.2 95.8 96.1 95.7 96.8 95.0 93.8 93.4 93.5 60 Printing and support 323 2.8 97.8 95.2 95.5 96.2 95.5 98.4 98.6 99.9 99.5 98.4 98.9 99.9 99.9 99.0 61 Petroleum and coal products 324 1.4 102.9 103.5 104.2 103.4 102.4 103.0 102.7 101.0 99.4 103.9 105.0 102.2 102.6 103.2 62 Chemical 325 10.3 105.1 105.2 105.1 105.0 105.7 106.9 106.2 106.1 104.6 104.2 103.4 103.8 104.4 104.9 63 Plastics and rubber products 326 3.4 106.0 105.1 105.7 106.7 107.4 107.5 107.3 107.2 106.4 105.8 104.6 105.1 105.0 104.7 64 Other manufacturing (non-NAICS) 1133,5111 4.3 105.5 105.0 104.1 104.2 105.5 105.0 105.8 107.1 106.7 105.4 105.9 105.3 107.0 107.3 65 Mining 21 6.6 93.8 93.6 93.4 93.4 93.5 94.4 93.9 92.2 92.3 93.6 95.2 93.8 94.2 94.7 66 Utilities 2211,2 10.1 110.2 108.0 110.6 110.1 110.1 113.7 110.4 113.3 112.1 112.1 110.5 114.9 116.4 111.6 67 Electric 2211 8.6 111.8 110.1 112.5 111.2 111.4 115.7 112.2 115.8 113.7 113.3 112.2 116.8 118.1 113.6 68 Natural gas 2212 1.6 97.5 96.9 100.2 104.4 103.2 102.7 100.8 99.9 103.6 105.8 101.6 105.4 107.4 101.1 69 Manufacturing excluding computers, communications equipment, and semiconductors 78.0 99.8 99.4 99.5 99.9 100.2 100.6 100.6 100.4 99.7 99.8 98.8 99.4 99.1 98.8 70 Manufacturing excluding motor vehicles and parts 77.6 110.9 110.5 110.5 111.0 111.3 111.4 111.5 111.3 110.8 110.5 109.9 110.2 110.2 110.2 Note. The statistics in the G.17 release cover output, capacity, and capacity utilization in the 1. Data in this table appear in the Board's G.17 (419) monthly statistical release. The data industrial sector, which the Federal Reserve defines are manufacturing, mining, and electric are also available on the Board's web site http://www.federalreserve.gov/releases/gl7. The and gas utilities. Manufacturing consists of those industries included in the North American latest historical revision of the industrial production index and the capacity utilization rates Industry Classification System, or NAICS, manufacturing plus those industries—logging and was released in December 2002. The recent annual revision is described in the April 2003 newspaper, periodical, book, and directory publishing—that have traditionally been consid- issue of the Bulletin. ered manufacturing and included in the industrial sector. 2. North American Industry Classification System. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A44 International Statistics • June 2003 3.10 U.S. INTERNATIONAL TRANSACTIONS Summary Millions of dollars; quarterly data seasonally adjusted except as noted1 2001 2002 IItteemm ccrreeddiittss oorr ddeebbiittss 22000000 22000011 22000022 Q4 Ql Q2 Q3 Q4P 1 Balance on current account —410,341 -393,371 -503,427 -95,086 -112,542 -127,697 -126,337 -136,854 2 Balance on goods and services -378,681 -358,290 -435,542 -88,028 -95,629 -109,446 -110,257 -120,213 3 Exports 1,064,239 998,022 971,864 232,930 232,959 244,251 248,917 245,740 4 Imports -1,442,920 -1,356,312 -1,407,406 -320,958 -328,588 -353,697 -359,174 -365,953 Income, net 21,782 14,382 -11,862 6,521 -982 -5,324 -3,007 -2,553 6 Investment, net 27,651 20,539 -5,424 8,102 636 -3,675 -1,462 -927 7 Direct 88,862 102,595 77,947 28,602 22,023 18,749 18,626 18,548 8 Portfolio -61,211 -82,056 -83,371 -20,500 -21,387 -22,424 -20,088 -19,475 9 Compensation of employees -5,869 -6,157 -6,438 -1,581 -1,618 -1,649 -1,545 -1,626 10 Unilateral current transfers, net -53,442 -49,463 -56,023 -13,579 -15,931 -12,927 -13,073 -14,088 11 Change in U.S. government assets other than official reserve assets, net (increase, -) -941 -486 379 143 133 42 -27 223311 12 Change in U.S. official reserve assets (increase, -) -290 —4,911 -3,681 -199 390 -1,843 -1,416 -812 13 Gold 0 0 0 0 0 0 0 0 14 Special drawing rights (SDRs) -722 -630 -475 -140 -109 -107 -132 -127 15 Reserve position in International Monetary Fund 2,308 -3,600 -2,632 83 652 -1,607 -1,136 -541 16 Foreign currencies -1,876 -681 -574 -142 -153 -129 -148 -144 17 Change in U.S. private assets abroad (increase, -) -605,258 -365,565 -152,867 -100,032 -26,707 -129,544 41,714 -38,334 18 Bank-reported claims2 -148,657 -128,705 -3,072 -83,682 727 -68,655 53,815 11,041 19 Nonbank-reported claims -150,805 -14,358 -28,489 37,210 65 -16,693 -4,226 -7,635 20 U.S. purchase of foreign securities, net -127,502 -94,662 2,222 -26,090 2,047 -9,675 18,543 -8,693 21 U.S. direct investments abroad, net -178,294 -127,840 -123,528 -27,470 -29,546 -34,521 -26,418 -33,047 22 Change in foreign official assets in United States (increase, +) 37,640 5,224 96,630 5,086 7,641 47,252 9,534 32,203 23 U.S. Treasury securities -10,233 10,745 43,656 16,760 -582 15,193 1,415 27,630 24 Other U.S. government obligations 40,909 20,920 30,357 7,630 7,296 6,548 10,885 5,628 25 Other U.S. government liabilities2 -1,909 -1,882 158 -504 -790 54 1,001 -107 26 Other U.S. liabilities reported by U.S. banks2 5,746 -30,278 18,831 -20,507 991 24,531 -4,602 -2,089 27 Other foreign official assets3 3,127 5,719 3,628 1,707 726 926 835 1,141 28 Change in foreign private assets in United States (increase, +) 978,346 747,582 533,734 245,711 105,959 157,159 119,786 150,827 29 U.S. bank-reported liabilities4 116,971 110,667 94,605 85,598 -11,051 32,240 18,793 54,623 30 U.S. nonbank-reported liabilities 174,251 82,353 49,736 1,170 32,345 21,056 -3,804 139 31 Foreign private purchases of U.S. Treasury securities, net -76,965 -7,670 53,155 27,229 -7,282 -5,124 52,856 12,705 32 U.S. currency flows 1,129 23,783 21,513 10,497 4,525 7,183 2,556 7,249 33 Foreign purchases of other U.S. securities, net 455,213 407,653 284,611 99,320 71,095 104,404 46,494 62,618 34 Foreign direct investments in United States, net 307,747 130,796 30,114 21,897 16,327 -2,600 2,891 13,493 35 Capital account transactions, net5 837 826 708 205 208 200 156 144 36 Discrepancy 7 10,701 28,524 -55,828 24,918 54,431 ^t3,410 -7,405 37 Due to seasonal adjustment 1,721 10,269 1,504 -13,991 2,228 38 Before seasonal adjustment 7 10,701 28,524 -57,549 14,649 52,927 -29,419 -9,633 MEMO Changes in official assets 39 U.S. official reserve assets (increase, -) -290 -4,911 -3,681 -199 390 -1,843 -1,416 --881122 40 Foreign official assets in United States, excluding line 25 (increase, +) 39,549 7,106 96,472 5,590 8,431 47,198 8,533 32,310 41 Change in Organization of Petroleum Exporting Countries official assets in United States (part of line 22) 12,000 -1,725 -8,132 3,382 -8,532 838 --11,,228899 885511 1. Seasonal factors are not calculated for lines 11-16, 18-20, 22-35, and 38—11. 5. Consists of capital transfers (such as those of accompanying migrants entering or 2. Associated primarily with military sales contracts and other transactions arranged with leaving the country and debt forgiveness) and the acquisition and disposal of nonproduced or through foreign official agencies. nonfinancial assets. 3. Consists of investments in U.S. corporate stocks and in debt securities of private SOURCE. U.S. Department of Commerce, Bureau of Economic Analysis, Survey of Current corporations and state and local governments. Business. 4. Reporting banks included all types of depository institutions as well as some brokers and dealers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Summary Statistics A45 3.12 U.S. RESERVE ASSETS Millions of dollars, end of period 2002 2003 AAsssseett 11999999 22000000 22000011 Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr.P 1 Total 71,516 67,647 68,654 75,860 75,499 75,690 79,006 78,434 78,579 80,049 80,405 2 Gold stock1 11,048 11,046 11,045 11,042 11,042 11,043 11,043 11,043 11,043 11,043 11,043 3 Special drawing rights2-3 10,336 10,539 10,774 11,710 11,700 11,855 12,166 11,298 11,368 11,392 11,476 4 Reserve position in International Monetary Fund2 17,950 14,824 17,854 20,857 20,586 20,480 21,979 21,953 21,686 22,858 22,738 5 Foreign currencies4 32,182 31,238 28,981 32,251 32,171 32,312 33,818 34,140 34,482 34,756 35,148 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 2002 2003 AAsssseett 11999999 22000000 22000011 Sept.r Oct.r Nov.r Dec.r Jan.r Feb.' Mar.r Apr.P 1 Deposits 71 215 61 86 150 89 78 136 102 224 254 Held in custody 2 U.S. Treasury securities2 632,482 594,094 592,630 638,003 644,381 647,165 669,092 678,106 683,837 700,341 710,955 3 Earmarked gold3 9,933 9,451 9,099 9,064 9,057 9,050 9,045 9,045 9,045 9,045 9,045 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

A46 International Statistics • June 2003 3.15 SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS Millions of dollars, end of period 2002 2003 IItteemm 22000000 22000011 Aug. Sept. Oct. Nov. Dec. Jan. Feb.P 1 Total1 975,303 987,567 l,048,756r l,049,985r l,047,933r l,069,536r l,082,291r l,087,008r 1,108,545 By type 2 Liabilities reported by banks in the United States2 144,593 123,425 138,203r 143,113' 136,721' 138,496' 141,019' 137,045' 148,585 3 U.S. Treasury bills and certificates3 153,010 161,719 188,805r 185,187' 188,474' 190,111' 190,375' 194,762' 196,345 U.S. Treasury bonds and notes 4 Marketable 450,832 454,306 450,216r 446,705' 446,152' 462,729' 469,437' 468,682' 471,223 5 Nonmarketable4 5,348 3,411 S.tMO' 3,058' 3,078' 3,097' 2,769' 2,786' 2,803 6 U.S. securities other than U.S. Treasury securities5 221,520 244,706 268,492r 271,922' 273,508' 275,103' 278,691' 283,733' 289,589 By area 7 Europe1 240,325 243,448 255,321r 260,506' 254,425' 265,831' 273,136' 270,148' 279,816 8 Canada 13,727 13,440 10,720r 10,097' 10,300' 10,975' 11,079' 10,455' 9,796 9 Latin America and Caribbean 70,442 71,103 62,026r 62,227' 64,289' 63,002' 63,244' 62,016' 63,228 10 Asia 626,016 635,179 693,596' 690,746' 692,195' 701,016' 706,131' 718,000' 727,144 11 Africa 14,690 15,167 15,257' 14,514' 15,524' 15,602' 15,338' 14,589' 15,939 12 Other countries 10,101 9,228 11,834' 11,893' 11,198' 13,108' 13,361' 11,798' 12,620 1. Includes the Bank for International Settlements. 5. Debt securities of U.S. government corporations and federally sponsored agencies, and 2. Principally demand deposits, time deposits, bankers acceptances, commercial paper, U.S. corporate stocks and bonds. negotiable time certificates of deposit, and borrowings under repurchase agreements. SOURCE. Based on U.S. Department of the Treasury data and on data reported to the 3. Includes nonmarketable certificates of indebtedness and Treasury bills issued to official Treasury by banks (including Federal Reserve Banks) and securities dealers in the United institutions of foreign countries. States, and in periodic benchmark surveys of foreign portfolio investment in the United 4. Excludes notes issued to foreign official nonreserve agencies. Includes current value of States. zero-coupon Treasury bond issues to foreign governments as follows: Mexico, beginning March 1990, 30-year maturity issue; Venezuela, beginning December 1990, 30-year maturity issue; Argentina, beginning April 1993, 30-year maturity issue. 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 2002 IItteemm 11999999 22000000 22000011 Mar. June Sept. Dec. 1 Banks' liabilities 88,537 77,779 79,363 74,955 89,823 81,719 80,541 2 Banks' claims 67,365 56,912 74,840 77,746 90,622 85,165 76,618 3 Deposits 34,426 23,315 44,094 46,778 51,860 44,511 33,085 4 Other claims 32,939 33,597 30,746 30,968 38,762 40,654 43,533 5 Claims of banks' domestic customers2 20,826 24,411 17,631 16,642 15,848 20,475 33,632 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

Bank-Reported Data A47 3.20 BANKS' OWN CLAIMS ON UNAFFILIATEDF OREIGNERSR eported by Banks in the United States1 Payable in U.S. dollars Millions of dollars, end of period 2002 2003 IItteemm 22000000RR 220000 llrr 22000022RR Aug.r Sept.' Oct.' Nov.' Dec.' Jan.' Feb.P BY HOLDER AND TYPE OF LIABILITY 1 Total, all foreigners 1,511,410 1,636,538 1,818,517 1,763,242 1,748,122 1,834,715 1,776,362 1,818,517 1,767,406 1,910,159 2 Banks' own liabilities 1,077,636 1,181,097 1,274,227 1,225,373 1,218,134 1,305,674 1,242,279 1,274,227 1,224,486 1,349,490 By type of liability 3 Deposits2 221,248 191,742 171,802 161,203 156,758 164,057 165,306 171,802 164,940 709,413 4 Other 171,401 197,064 249,954 257,916 273,178 263,717 256,726 249,954 272,155 640,077 5 Of which: repurchase agreements3 0 151,143 190,134 200,141 213,172 200,313 190,283 190,134 210,349 272,790 6 Banks' custody liabilities4 433,774 455,441 544,290 537,869 529,988 529,041 534,083 544,290 542,920 560,669 By type of liability / U.S. Treasury bills and certificates5 177,846 186,115 229,511 227,338 224,733 223,569 226,302 229,511 231,363 233,848 8 Other negotiable and readily transferable instruments6 145,840 139,807 163,751 163,246 161,710 160,122 156,558 163,751 160,825 177,849 9 Of which: negotiable time certificates of deposit held in custody for foreigners 34,217 20,440 26,084 29,847 29,700 29,198 26,435 26,084 25,596 27,921 10 Of which: short-term agency securities7 0 59,781 73,078 72,549 70,724 68,834 66,226 73,078 67,933 74,851 11 Other 110,088 129,519 151,028 147,285 143,545 145,350 151,223 151,028 150,732 148,972 12 Nonmonetary international and regional organizations8 12,543 10,830 13,469 10,454 11,712 13,069 12,221 13,469 14,625 12,086 13 Banks' own liabilities 12,140 10,169 12,362 9,898 10,923 12,454 11,443 12,362 13,921 11,433 14 Deposits2 6,287 3,791 5,769 6,240 5,669 6,178 5,245 5,769 5,298 5,802 15 Other 5,853 6,378 6,593 3,658 5,254 6,276 6,198 6,593 8,623 5,631 16 Banks' custody liabilities4 403 661 1,107 556 789 615 778 1,107 704 653 17 U.S. Treasury bills and certificates5 252 600 1,089 534 765 597 760 1,089 687 621 18 Other negotiable and readily transferable instruments6 149 61 18 22 18 18 18 18 17 32 19 Other 2 0 0 0 6 0 0 0 0 0 20 Official institutions9 297,603 285,144 331,394 327,008 328,300 325,195 328,607 331,394 331,807 344,930 21 Banks' own liabilities 96,989 83,824 90,822 89,262 96,598 91,550 93,558 90,822 90,764 97,299 22 Deposits2 39,525 22,668 20,629 17,085 15,912 17,736 17,525 20,629 17,162 22,494 23 Other 57,464 61,156 70,193 72,177 80,686 73,814 76,033 70,193 73,602 74,805 24 Banks' custody liabilities4 200,614 201,320 240,572 237,746 231,702 233,645 235,049 240,572 241,043 247,631 25 U.S. Treasury bills and certificates5 153,010 161,719 190,375 188,805 185,187 188,474 190,111 190,375 194,762 196,345 26 Other negotiable and readily transferable instruments6 47,366 38,531 50,133 47,746 45,571 44,391 44,137 50,133 45,285 50,764 27 Other 238 1,070 64 1,195 944 780 801 64 996 522 28 Banks10 972,932 1,053,084 1,164,864 1,097,630 1,083,250 1,184,129 1,127,288 1,164,864 1,104,475 1,105,952 29 Banks' own liabilities 821,306 914,492 969,975 908,871 898,626 996,584 934,125 969,975 909,724 912,432 30 Deposits2 82,426 68,656 52,738 46,124 43,109 48,053 51,088 52,738 48,842 566,088 31 Other 53,893 53,545 64,766 56,493 67,319 70,631 62,790 64,766 73,491 346,344 32 Banks' custody liabilities4 151,626 138,592 194,889 188,759 184,624 187,545 193,163 194,889 194,751 193,520 33 U.S. Treasury bills and certificates5 16,023 11,541 21,308 20,463 20,079 19,253 18,887 21,308 20,240 18,166 34 Other negotiable and readily transferable instruments6 36,036 24,059 46,773 46,911 46,990 48,250 47,836 46,773 48,618 52,120 35 Other 110,088 129,519 151,028 147,285 143,545 145,350 151,223 151,028 150,732 148,972 36 Other foreigners" 228,332 287,480 308,790 328,150 324,860 312,322 308,246 308,790 316,499 447,191 37 Banks' own liabilities 147,201 172,612 201,068 217,342 211,987 205,086 203,153 201,068 210,077 328,326 38 Deposits2 93,010 96,627 92,666 91,754 92,068 92,090 91,448 92,666 93,638 115,029 39 Other 54,191 75,985 108,402 125,588 119,919 112,996 111,705 108,402 116,439 213,297 40 Banks' custodial liabilities 81,131 114,868 107,722 110,808 112,873 107,236 105,093 107,722 106,422 118,865 41 U.S. Treasury bills and certificates5 8,561 12,255 16,739 17,536 18,702 15,245 16,544 16,739 15,674 18,716 42 Other negotiable and readily transferable instruments6 62,289 77,156 66,827 68,567 69,131 67,463 64,567 66,827 66,905 74,933 43 Other 10,281 25,457 24,156 24,705 25,040 24,528 23,982 24,156 23,843 25,216 MEMO 44 Own foreign offices'2 684,987 792,291 852,471 806,254 788,198 877,900 820,247 852,471 787,391 851,295 1. Reporting banks include all types of depository institutions as well as some banks/ 9. Foreign central banks, foreign central governments, and the Bank for International financial holding companies and brokers and dealers. Excludes bonds and notes of maturities Settlements. longer than one year. Effective February 2003, coverage is expanded to include liabilities of 10. Excludes central banks, which are included in "Official institutions." Includes posibrokers and dealers to affiliated foreign offices. tions with affiliated banking offices also included in memo line (44) below. 2. Non-negotiable deposits and brokerage balances. 11. As of February 2003, includes positions with affiliated non-banking offices also 3. Data available beginning January 2001. included in memo line (44) below. 4. Financial claims on residents of the United States, other than long-term securities, held 12. For U.S. banks, includes amounts owed to own foreign branches and foreign subsidiby or through reporting banks for foreign customers. Effective February 2003, also includes aries consolidated in the quarterly Consolidated Reports of Condition filed with bank loans to U.S. residents in managed foreign offices of U.S. reporting institutions. regulatory agencies. For agencies, branches, and majority-owned subsidiaries of foreign 5. Includes nonmarketable certificates of indebtedness and Treasury bills issued to official banks, consists principally of amounts owed to the head office or parent foreign office, and to institutions of foreign countries. foreign branches, agencies, or wholly owned subsidiaries of the head office or parent foreign 6. Principally bankers acceptances, commercial paper, negotiable time certificates of bank. Effective February 2003, includes amounts owed to affiliated foreign offices of U.S. deposit, and short-term agency securities. brokers and dealers. 7. Data available beginning January 2001. 8. Principally the International Bank for Reconstruction and Development, the Inter- American Development Bank, and the Asian Development Bank. Excludes "holdings of dollars" of the International Monetary Fund. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A48 International Statistics • June 2003 3.17 LIABILITIES TO FOREIGNERS Reported by Banks in the United States'—Continued Payable in U.S. dollars Millions of dollars, end of period 2002 2003 IItteemm 22000000 22000011 22000022 Aug. Sept. Oct. Nov. Dec. Jan. Feb.e AREA OR COUNTRY 45 Total, all foreigners 1,511,410 1,636,538 l,818,517r 1,763,242' l,748,122r l,834,715r 1,776,362' l,818,517r l,767,406r 1,910,159 46 Foreign countries 1,498,867 1,625,708 l,805,048r l,752,788r l,736,410r l,821,646r l,764,141r l,805,048r l,752,781r 3,796,146 47 Europe 446,788 521,331 627,641' 557,184' 578,027' 658,742' 615,473' 627,641' 566,332' 684,572 48 Austria 2,692 2,922 2,473 3,537 3,081 3,053 2,442 2,473 2,186 2,326 49 Belgium13 33,399 6,557 8,611 6,270 8,389 7,420 8,032 8,611 8,858' 9,635 50 Denmark 3,000 3,626 4,880 4,061 3,112 3,004 3,339 4,880 6,497 6,-601 51 Finland 1,411 1,446 1,693 1,498 1,259 5,170 2,646 1,693 2,583 1,861 52 France 37,833 49,056 39,640 35,447 37,915 38,515 40,752 39,640 36,731 39,570 53 Germany 35,519 22,375 34,398 27,081 31,334 31,558 32,025 34,398 31,940 38,804 54 Greece 2,011 2,307 2,975 2,677 2,612 3,358 3,348 2,975 3,205 2,906 55 Italy 5,072 6,354 4,828r 3,512' 3,522' 5,111' 5,644' 4,828' 4,421' 4,807 56 Luxembourg13 0 16,894 28,626 25,436 25,750 25,680 27,747 28,626 30,538 36,000 5/ Netherlands 7,047 12,411 10,722 8,207' 7,649' 7,974 7,922 10,722 12,104' 16,280 58 Norway 2,305 3,727 18,867 10,049 17,747 18,895 14,677 18,867 17,723 10,937 59 Portugal 2,403 4,033 3,575 3,055 3,695 3,220 3,092 3,575 3,448 2,878 60 Russia 19,018 20.800 23,147 24,196 25,252 24,407 25,444 23,147 24,378 27,644 61 Spain 7,787 8,811 14,032r 12,429 12,596 12,824' 15,576 14.032' 14,850' 16,037 62 Sweden 6,497 3,375 4,656 5,709 4,137 4,857 3,859 4,656 3,767 4,006 63 Switzerland 74,635 66,403 131,506 102,088 105,384' 182,150' 141,208 131,506 105,352 119,422 64 Turkey 7,548 7,474 12,131 12,393 12,790 11,226 11,749 12,131 12,754 11,972 65 United Kingdom 167,757 204,396 181,890 184,152 183,756 184,483 182,109 181,890 168,426' 251,918 66 Channel Islands and Isle of Man14 0 36,059 45,728 38,215 38,982 40,070 38,935 45,728 26,327 23,011 67 Yugoslavia" 276 309 301 276 280 316 332 301 353 337 68 Other Europe and other former U.S.S.R.16 30,578 41,996 52,962 46,896 48,785 45,451 44,595 52,962 49,891 57,620 69 Canada 30,982 27,251 24,959 24,887 24,946 26,570 24,278 24,959 27,885' 28,601 70 Latin America 120,041 118,025 107,129r 106,950' 104,134' 106,883' 103,991' 107,129' 106,092' 103,915 71 Argentina 19,451 10,704 11,218 11,686 11,223 12,091 11,644 11,218 11,252 10,555 72 Brazil 10,852 14,169 10,037 12,070 11,586 11,587 10,275 10,037 10,586 10,991 73 Chile 5,892 4,939 6,064' 5,829' 5,493' 5,826' 5,360' 6,064' 5,591' 5,801 74 Colombia 4,542 4,695 4,158 3,719 4,509 3,847 4,644 4,158 4,147 4,883 75 Ecuador 2,112 2,390 2,299' 2,260' 2,368' 2,149' 2,252' 2,299' 2,397' 2,237 76 Guatemala 1,601 1,882 1,381 1,384 1,535 1,500 1,386 1,381 1,436 1,478 77 Mexico 32,166 39,871 36,152 35,071 32,486 34,665 32,615 36,152 36,878 34,751 78 Panama 4,240 3,610 3,924 3,161 3,210 3,564 3,668 3,924 3,969 4,156 79 Peru 1,427 1,359 1,363 1,366 1,369 1,300 1,360 1,363 1,364 1,360 80 Uruguay 3,003 3,172 2,807 2,648 2,613 2,583 2,604 2,807 2,681 2,457 81 Venezuela 24,730 24,974 21,884' 21,568' 21,350' 21,657' 22,311' 21,884' 19,951' 19,604 82 Other Latin America17 10,025 6,260 5,842 6,188 6,392' 6,114 5,872 5,842 5,840 5,642 83 Caribbean 573,337 194,814r 193,363' 210,874' 198,136' 190,737' 179,736' 193,363' 205,074' 200,531 84 Bahamas 189,298 178,472 162.196 172,518 166,477 159,867 145,993 162,196 168,969' 164,762 85 Bermuda 9,636 10,539 23,823' 24,968 24,692 23,158 25,765 23,823' 27,441' 28,804 86 British West Indies18 367,197 0 0 0 0 0 0 0 0 0 87 Cayman Islands18 0 440,038 498,957' 488,768' 472,967' 491,970' 488,995' 498,957' 496,510' 516,883 88 Cuba 90 88 91 99 92 92 94 91 93 216 89 Jamaica 794 1,182 829 948 932 856 828 829 883 850 90 Netherlands Antilles 5,428 3,264 5,019 10,538 4,381 5,293 5,476 5,019 6,329 4,513 91 Trinidad and Tobago 894 1,269 1,405 1,803 1,562 1,471 1,580 1,405 1,359 1,386 92 Other Caribbean17 0 12,135 11,342' 15,016 11,359 10,835 11,489' 11,342' 11,057' 18,645 93 Asia 305,554 294,496 318.028' 326,675' 325,691' 331144,,771144'' 331166,,448844'' 331188,,002288'' 331188,,882255'' 331199,,115555 China 94 Mainland 16,531 10,498 15,504 18,809' 14,622' 15,853' 14,488' 15,504 13,544 13,622 95 Taiwan 17,352 17,633 18,626' 20,057' 21,672' 23,216' 23,549' 18,626' 22,148' 23,846 96 Hong Kong 26,462 26,494 33,047' 31,033' 31,700' 30,117' 31,347' 33,047' 36,780' 35,690 9/ India 4,530 3,708 7,953 7,253 7,502 7,196 7,507 7,953 8,074 8,775 98 Indonesia 8,514 12,383 14,110 13,805 13,098 12,316 12,916 14,110 12,858 12,415 99 Israel 8,053 7,870 7,185 7,960 11,619 9,105 8,882 7,185 9,593 10,150 100 Japan 150,415 155,314 161,331 175,993 171,821 162,043 163,981 161,331 162,110 166,355 101 Korea (South) 7,955 9,019 8,932 6,846 6,563 6,288 6,548 8,932 7,410 7,063 102 Philippines 2,316 1,772 1,793 1,573 2,064 1,589 1,462 1,793 1,364 1,523 103 Thailand 3,117 4,743 7,605 5,113 5,044 7,022 8,698 7,605 6,666 5,029 104 Middle Eastern oil-exporting countries19 23,763 20,035 16,364 15,435 15,993 14,352 11,633 16,364 15,176 12,176 105 Other 36,546 25,027 25.578 22,798 23,993 25,617 25,473 25,578 23,102 22,511 106 Africa 10,824 11,365 12,240 12,103 11,115 11,905 11,989 12,240 11,177 14,369 107 Egypt 2,621 2,778 2,652 3,179 2,538 2,545 2,493 2,652 2,494 3,608 108 Morocco 139 274 306 312 329 335 254 306 259 346 109 South Africa 1,010 839 1,114 747 747 662 701 1,114 725 2,403 110 Congo (formerly Zaire) 4 4 2 0 86 0 2 2 3 5 111 Oil-exporting countries20 4,052 4,377 4,370 3,940 3,670 4,635 4,983 4,370 4,126 4,552 112 Other 2,998 3,093 3,796 3,925 3,745 3,728 3,556 3,796 3,570 3,455 113 Other countries 11,341 6,253 11,389 10,331' 10,035' 9,290' 11,706' 11,389 9,829 11,402 114 Australia 10,070 5,599 9,333 8,595' 7,919' 7,549' 9,34a 9,333 8,235 8,992 115 New Zealand21 0 242 1,796 1,321 1,592 1,257 2,120 1,796 1,320 1,938 116 All other 1,271 412 260 415 524 484 246 260 274 472 117 Nonmonetary international and regional organizations 12,543 10,830 13,469' 10,454' 11,712' 13,069' 12,221' 13,469' 14,625' 12,086 118 International22 11,270 9,331 11,283' 8,991' 9,140' 11,296' 10,247' 11,283' 12,859' 10,212 119 Latin American regional23 740 480 508 402 394 561 478 508 373 553 120 Other regional24 533 935 1,611' 986' 2,108' 1,134' 1,423' 1,611' 1,299' 1,216 13. Before January 2001, data for Belgium-Luxembourg were combined. 19. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab 14. Before January 2001, these data were included in data reported for the United Emirates (Trucial States). Kingdom. 20. Comprises Algeria, Gabon, Libya, and Nigeria. 15. In February 2003, Yugoslavia changed its name to Serbia and Montenegro. Data for 21. Before January 2001, these data were included in "All other." other entities of the former Yugoslavia recognized as independent states by the United States 22. Principally the International Bank for Reconstruction and Development. Excludes are reported under "Other Europe." "holdings of dollars" of the International Monetary Fund. 16. Includes the Bank for International Settlements and the European Central Bank. 23. Principally the Inter-American Development Bank. 17. Before January 2001, data for "Other Latin America" and "Other Caribbean" were 24. Asian, African, Middle Eastern, and European regional organizations, except the Bank combined in "Other Latin America and Caribbean." for International Settlements, which is included in "Other Europe." 18. Beginning January 2001, data for the Cayman Islands replaced data for the British West Indies. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Bank-Reported Data A49 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 2002 2003 AArreeaa oorr ccoouunnttrryy 22000000 22000011 22000022 Aug. Sept. Oct. Nov. Dec.' Jan.' Feb.P 1 Total, all foreigners 904,642 1,055,069 l,080,271r l,084,883r l,063,550r l,151,438r l,094,649r 1,080,271 1,075,773 1,110,502 2 Foreign countries 899,956 1,050,123 l,076,594r l,080,636r l,060,912r l,148,738r l,091,331r 1,076,594 1,072,614 2,214,282 3 Europe 378,115 461,176 484,047r 482,394' 469,979' 542,565' 489,943' 484,047 446,105 504,688 4 Austria 2,926 4,981 3,603 4,467 4,336 3,876 4,224 3,603 4,334 5,609 5 Belgium2 5,399 6,391 6,044 5,140 4,814 5,590 5,784 6,044 6,273 5,138 6 Denmark 3,272 1,105 1,109 1,546 1,633 1,534 940 1,109 1,563 1,098 7 Finland 7,382 10,350 8,518 16,230 15,812 14,821 9,028 8,518 9,832 9,191 8 France 40,035 60,620 47,705 51,798 51,083 47,065 54,089 47,705 45,914 48,596 9 Germany 36,834 29,902 22,481 26,072 23,344 21,101 22,103 22,481 23,395 22,412 10 Greece 646 330 477 438 408 388 331 477 296 292 11 Italy 7,629 4,205 3,753 4,442 5,092 3,984 3,945 3,753 3,177 3,002 12 Luxembourg2 0 1,267 3,407 3,067 2,847 2,818 3,224 3,407 3,901 4,360 13 Netherlands 17,043 15,908 23,133 18,232 17,691 13,284 15,572 23,133 19,188 15,940 14 Norway 5,012 6,236 13,885 10,578 11,036 11,848 11,464 13,885 18,606 9,809 1 Portugal 1,382 1,603 2,226 1,823 2,006 2,000 2,134 2,226 2,356 2,342 16 Russia 517 594 877 842 801 858 787 877 1,025 728 17 Spain 2,603 3,260 5,371r 3,566' 4,651' 3,159' 4,752' 5,371 4,154 3,451 18 Sweden 9,226 12,544 15,889' 14,618 13,970 15,366 15,239 15,889 15,329 15,271 19 Switzerland 82,085 87,333 126,958' 106,281 103,920 184,039 134,425 126,958 87,562 99,753 20 Turkey 3,059 2,124 2,112 2,515 2,474 2,622 2,532 2,112 2,021 2,070 21 United Kingdom 144,938 201,183 173,996' 201,349' 194,020' 195,256' 182,805' 173,996 167,820 221,928 22 Channel Islands and Isle of Man3 0 4,478 17,457 5,076 5,926 7,281 11,304 17,457 24,393 27,763 23 Yugoslavia4 50 0 0 0 0 0 0 0 0 0 24 Other Europe and other former U.S.S.R.5 8,077 6,762 5,046 4,314 4,115 5,675 5,261 5,046 4,966 5,935 25 Canada 39,837 54,421 60,584' 59,553' 62,053' 56,705' 58,809' 60,584 65,149 66,110 26 Latin America 76,561 69,762 56,642 62,214 60,377 59,261 58,257 56,642 54,482 55,332 27 Argentina 11,519 10,763 6,783 8,090 7,663 7,608 7,253 6,783 6,663 6,616 28 Brazil 20,567 19,434 15,419 17,945 17,266 16,863 15,871 15,419 14,520 15,334 29 Chile 5,815 5,317 5,250 4,960 5,118 5,142 5,358 5,250 5,077 5,215 30 Colombia 4,370 3,602 2,614 3,158 3,078 2,834 2,758 2,614 2,406 2,707 31 Ecuador 635 495 457 479 467 451 451 457 439 426 32. Guatemala 1,244 1,495 892 861 925 907 889 892 896 831 33 Mexico 17,415 16,522 15,658 16,015 15,805 15,367 15,828 15,658 15,268 14,931 34 Panama 2,933 3,061 1,915 2,433 1,959 2,021 1,961 1,915 1,730 1,846 35 Peru 2,807 2,185 1,411 1,649 1,599 1,504 1,484 1,411 1,403 1,437 36 Uruguay 673 447 255 527 345 319 292 255 255 294 37 Venezuela 3,518 3,077 3,254 3,291 3,301 3,389 3,231 3,254 3,202 3,172 38 Other Latin America6 5,065 3,364 2,734 2,806 2,851 2,856 2,881 2,734 2,623 2,523 39 Caribbean 319,403 370,945 373,712 367,940 347,780 373,472 372,683 373,712 394,773 374,912 40 Bahamas 114,090 101,034 95,584 95,729 91,171 96,151 93,839 95,584 97,456 86,299 41 Bermuda 9,260 7,900 9,902 11,847 11,304 12,196 9,902 9,902 12,511 17,028 42 British West Indies7 189,289 0 0 0 0 0 0 0 0 0 43 Cayman Islands7 0 250,376 257,075 248,107 234,435 252,908 257,645 257,075 273,960 259,234 44 Cuba 0 0 0 0 0 0 0 0 0 0 45 Jamaica 355 418 321 353 463 429 393 321 304 346 46 Netherlands Antilles 5,801 6,729 6,690 7,334 6,194 7,427 6,744 6,690 6,445 7,658 47 Trinidad and Tobago 608 931 889 877 916 920 912 889 865 971 48 Other Caribbean6 0 3,557 3,251 3,693 3,297 3,441 3,248 3,251 3,232 3,375 49 77,829 85,882 93,455' 100,484 112,441 109,359 104,181 93,455 103,096 98,190 China 50 Mainland 1,606 2,073 1,057 5,904 7,256 8,515 6,575 1,057 4,799 1,884 51 Taiwan 2,247 4,407 3,772 7,443 8,656 8,599 7,034 3,772 6,563 5,695 52 Hong Kong 6,669 9,995 7,258' 6,531 8,481 5,778 6,849 7,258 6,490 5,652 53 India 2,178 1,348 1,235 1,293 1,258 999 921 1,235 1,128 1,170 54 Indonesia 1,914 1,752 1,238 1,457 1,426 1,390 1,360 1,238 1,223 1,076 55 Israel 2,729 4,396 4,660 4,952 5,067 4,710 3,836 4,660 5,182 3,330 56 Japan 34,974 34,125 47,600' 37,559 45,058 42,252 47,071 47,600 48,818 52,926 57 Korea (South) 7,776 10,622 11,118' 18,961 17,404 19,439 14,293 11,118 14,473 13,946 58 Philippines 1,784 2,587 2,137 1,593 2,134 1,843 1,555 2,137 2,424 1,543 59 Thailand 1,381 2,499 1,167 1,175 1,841 1,205 756 1,167 830 697 60 Middle Eastern oil-exporting countries8 9,346 7,882 7,952 8,975 8,619 9,253 8,251 7,952 8,004 6,408 61 Other 5,225 4,196 4,261' 4,641 5,241 5,376 5,680 4,261 3,162 3,863 62 Africa 2,094 2,095 1,977 1,887 1,891 1,790' 1,693 1,977 1,945 1,992 63 Egypt 201 416 487 324 332 326 428 487 511 544 64 Morocco 204 106 53 72 58 50 52 53 53 45 65 South Africa 309 710 617 601 576 554 435 617 545 577 66 Congo (formerly Zaire) 0 0 0 0 0 0 0 0 0 0 67 Oil-exporting countries9 471 167 222 247 303 233' 225 222 240 224 68 Other 909 696 598 643 622 627 553 598 596 602 69 Other countries 6,117 5,842 6,177 6,164 6,391 5,586 5,765 6,177 7,064 5,917 70 Australia 5,868 5,455 5,566 5,616 5,589 5,088 5,303 5,566 6,212 5,395 71 New Zealand10 0 349 569 541 789 485 439 569 833 507 72 All other 249 38 42 7 13 13 23 42 19 15 73 Nonmonetary international and regional organizations" . . 4,686 4,946 3,677 4,247 2,638 2,700 3,318 3,677 3,159 3,361 1. Reporting banks include all types of depository institutions as well as bank/financial 5. Includes the Bank for International Settlements and the European Central Bank. holding companies and brokers and dealers. Effective February 2003, coverage is expanded to 6. Before January 2001, "Other Latin America" and "Other Caribbean" were reported as include claims of brokers and dealers on affiliated foreign offices and cross-border brokerage combined "Other Latin America and Caribbean." balances. 7. Beginning 2001, Cayman Islands replaced British West Indies in the data series. 2. Before January 2001, combined data reported for Belgium-Luxembourg. 8. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab 3. Before January 2001, data included in United Kingdom. Emirates (Trucial States). 4. In February 2003, Yugoslavia changed its name to Serbia and Montenegro. Data for 9. Comprises Algeria, Gabon, Libya, and Nigeria. other entities of the former Yugoslavia recognized as independent states by the United States 10. Before January 2001, included in "All other." are reported under "Other Europe." 11. Excludes the Bank for International Settlements, which is included in "Other Europe." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A50 International Statistics • June 2003 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 2002 2003 Aug.' Sept.' Oct.' Nov.' Dec.' Jan.' Feb.P 1 Total claims reported by banks 1,095,869 1,254,863 1,290,232 1,253,664 1,290,232 2 Banks' own claims on foreigners 904,642 1,055,069 1,080,271 1,084,883 1,063,550 1,151,438 1,094,649 1,080,271 1,075,773 1,110,502 3 Foreign official institutions2 37,907 49,404 48,750 61,541 61,299 63,404 56,300 48,750 58,199 31,450 4 Foreign banks3 725,380 849,491 868,631 842,976 827,225 917,047 874,469 868,631 850,975 715,927 5 Other foreigners4 141,355 156,174 162,890 180,366 175,026 170,987 163,880 162,890 166,599 259,085 6 Claims on banks' domestic customers5 191.227 199,794 209,961 190,114 209,961 7 Non-negotiable deposits 100,352 93,565 79,512 86,862 79,512 8 Negotiable CDs 9 Other short-term negotiable instruments6 . . 78,i47 90,412 124,i59 90,919 124,159 10 Other claims 12,728 15,817 6,290 12,333 6,290 MEMO 11 Non-negotiable deposits7 336,851 12 Negotiable CDs7 2,199 13 Other short-term negotiable instruments7 18,434 14 Other claims7 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 753,018 15 Own foreign offices8 630,137 749,124 787,198 756,556 732,318 822,172 775,527 787,198 760,875 767,947 16 Loans collateralized by repurchase agreements9 137,979 161,585 172,949 166,568 166,176 156,299 161,585 185,804 223,238 1. For banks' claims, data are monthly; for claims of banks' domestic customers, data are 6. Primarily bankers acceptances and commercial paper. Prior to February 2003, also for the quarter ending with the month indicated. includes negotiable certificates of deposit. Reporting banks include all types of depository institutions as well as banks/financial 7. Data available beginning February 2003. holding companies and brokers and dealers. Effective February 2003, coverage is expanded to 8. For U.S. banks, includes amounts due from own foreign branches and foreign subsidiinclude claims of brokers and dealers on affiliated foreign offices and cross-border balances, aries consolidated in quarterly Consolidated Reports of Condition filed with bank regulatory dealers. agencies. For agencies, branches, and minority-owned subsidiaries of foreign banks, consists 2. Prior to February 2003, reflects claims on all foreign public borrowers. principally of amounts due from the head office or parent foreign bank, and from foreign 3. Includes positions with affiliated banking offices also included in memo line (15) below. branches, agencies, or wholly owned subsidiaries of the head office or parent foreign bank. 4. As of February 2003, includes positions with affiliated non-banking offices also included Effective February 2003, includes amounts due from affiliated foreign offices of U.S. brokers in memo line (15) below. and dealers. 5. Assets held by reporting banks in the accounts of their domestic customers. Effective 9. Data available beginning January 2001. March 2003, includes balances in off-shore sweep accounts. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Bank-Reported Data A51 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 2002 MMaattuurriittyy,, bbyy bboorrrroowweerr aanndd aarreeaa22 11999999 22000000 22000011 Mar. June Sept. Dec.P 1 Total 267,082 274,009 305,326 308,286 317,207 330,807 293,096 By borrower 2 Maturity of one year or less 187,894 186,103 200,240 214,373 236,219 250,076 212,972 3 Foreign public borrowers 22,811 21,399 27,501 31,875 33,061 42,665 31,569 4 All other foreigners 165,083 164,704 172,739 182,498 203,158 207,411 181,403 5 Maturity of more than one year 79,188 87,906 105,086 93,913 80,988 80,731 80,124 6 Foreign public borrowers 12,013 15,838 21,324 22,945 17,576 18,192 16,948 7 All other foreigners 67,175 72,068 83,762 70,968 63,412 62,539 63,176 By area Maturity of one year or less 8 Europe 80,842 142,464 83,233 85,848 88,641 92,111 83,172 9 Canada 7,859 8,323 10,072 8,227 8,928 7,731 6,933 10 Latin America and Caribbean 69,498 151,840 70,648 82,258 98,152 96,796 87,143 1 1 1 2 4 A A s f i r a ic a 21 1 , , 8 1 0 2 2 2 43 2 , , 3 2 7 6 1 3 29 1 , , 6 1 9 0 3 4 30 1 , , 5 1 4 2 3 4 34,7 9 1 1 0 8 48,2 8 1 9 0 6 30,3 7 2 2 3 6 13 Allother1 6,771 11,717 5,490 6,373 4,870 4,332 4,675 Maturity of more than one year 14 Europe 22,951 57,770 34,230 37,372 33,159 33,587 33,543 15 Canada 3,192 3,174 3,633 3,129 2,619 2,772 2,990 16 Latin America and Caribbean 39,051 82,684 47,382 35,537 32,142 31,376 32,172 17 Asia 11,257 19,536 15,190 13,563 8,688 9,128 6,920 18 Africa 1,065 1,567 769 720 907 812 845 19 Allother3 1,672 5,954 3,882 3,592 3,473 3,056 3,654 Note. Owing to changes in reporting requirements, this table will be discontinued in the 1. Maturity is time remaining until maturity, third quarter of 2003 after publication of the end-December 2003 data. 3. Includes nonmonetary international and regional organizations. 1. Reporting banks include all types of depository institutions as well as some brokers and dealers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A52 International Statistics • June 2003 3.22 LIABILITIES TO UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the United States Millions of dollars, end of period 2001 2002 TTyyppee ooff lliiaabbiilliittyy,, aanndd aarreeaa oorr ccoouunnttrryy 11999999rr 22000000'' 22000011 Sept. Dec. Mar. June Sept. Dec.p 1 Total 53,020 73,904 66,679 53,476r 66,679r 74,867 70,638 68,644 67,304 2 Payable in dollars 37,605 48,931 42,925 35,306' 42,925' 47,062 48,103 44,815 44,557 3 Payable in foreign currencies 15,415 24,973 23,754 18,170' 23,754' 27,805 22,535 23,829 22,747 By type 4 Financial liabilities 27,980 47,419 41,034 27,502 41,034 46,408 42,826 41,311 39,561 5 Payable in dollars 13,883 25,246 18,763 11,415 18,763 20,367 21,892 18,775 18,674 6 Payable in foreign currencies 14,097 22,173 22,271 16,087 22,271 26,041 20,934 22,536 20,887 7 Commercial liabilities 25,040 26,485 25,645 25,974' 25,645' 28,459 27,812 27,333 27,743 8 Trade payables 12,834 14,293 11,781 11,690' 11,781' 14,872 13,959 13,558 14,339 9 Advance receipts and other liabilities 12,206 12,192 13,864 14,284 13,864 13,587 13,853 13,775 13,404 10 Payable in dollars 23,722 23,685 24,162 23,891' 24,162' 26,695 26,211 26,040 25,883 11 Payable in foreign currencies 1,318 2,800 1,483 2,083' 1,483' 1,764 1,601 1,293 1,860 By area or country Financial liabilities 12 Europe 23,241 34,172 31,806 22,083 31,806 39,392 35,011 34,817 34,363 13 Belgium and Luxembourg 31 147 154 76 154 119 120 232 144 14 France 1,659 1,480 2,841 1,538 2,841 3,531 4,071 3,517 5,243 15 Germany 1,974 2,168 2,344 1,994 2,344 2,982 2,622 2,865 2,923 16 Netherlands 1,996 2,016 1,954 1,998 1,954 1,951 1,939 1,918 1,829 17 Switzerland 147 104 94 92 94 84 61 61 61 18 United Kingdom 16,521 26,362 22,852 14,819 22,852 28,630 24,188 24,175 22,422 19 Canada 284 411 955 436 955 1,067 1,078 583 591 20 Latin America and Caribbean 892 4,125 2,858 414 2,858 1,547 1,832 1,088 1,504 21 Bahamas 1 6 157 5 157 5 5 0 23 22 Bermuda 5 1,739 960 47 960 836 626 588 990 23 Brazil 126 148 35 22 35 35 38 65 65 24 British West Indies 492 406 1,627 243 1,627 612 1,000 377 365 25 Mexico 25 26 36 24 36 27 25 26 31 26 Venezuela 0 2 2 3 2 1 5 1 1 27 Asia 3,437 7,965 5,042 3,869 5,042 4,010 4,491 4,442' 2,916 28 Japan 3,142 6,216 3,269 3,442 3,269 3,299 2,387 2,447 1,832 29 Middle Eastern oil-exporting countries' 4 12 10 9 10 15 14 16 14 30 Africa 28 52 53 28' 53 122 120 128 131 31 Oil-exporting countries2 0 0 5 5 5 91 91 91 91 32 All other3 98 694 320 672 320 270 294 253 56 Commercial liabilities 33 Europe 9,262 9,629 9,219 8,836' 9,219' 8,384 8,468 8,745 8,295 34 Belgium and Luxembourg 140 293 99 160 99 105 94 134 141 35 France 672 979 734 891' 734' 713 827 718 777 36 Germany 1,131 1,047 905 955' 905' 584 570 855 807 37 Netherlands 507 300 1,163 343 1,163 463 765 1,186 590 38 Switzerland 626 502 790 683 790 637 749 592 433 39 United Kingdom 3,071 2,847 2,279 2,296 2,279' 2,747 2,551 2,317 2,649 40 Canada 1,775 1,933 1,622 1,557' 1,622' 1,798 2,027 1,570 1,384 41 Latin America and Caribbean 2,310 2,381 2,727 2,878' 2,727' 3,454 2,744 2,850 3,013 42 Bahamas 22 31 52 44 52 23 12 14 51 43 Bermuda 152 281 591 570 591 433 422 468 538 44 Brazil 145 114 290 312 290 277 320 290 253 45 British West Indies 48 76 45 28 45 67 46 47 36 46 Mexico 887 841 899 883' 899' 1,457 958 997 1,110 47 Venezuela 305 284 166 242 166 281 204 327 177 48 Asia 9,886 10,983 10,517 11,096' 10,517' 12,969 12,693 12,274 13,126 49 Japan 2,609 2,757 2,581 2,408' 2,581' 4,281 4,143 4,031 4,292 50 Middle Eastern oil-exporting countries' 2,493 2,796 2,598 3,002' 2,598' 3,093' 3,209' 3,624' 3,592 51 Africa 950 948 836 938 836 976 916 876 905 52 Oil-exporting countries2 499 483 436 471 436 454 349 445 405 53 Other3 881 611 724 669 724 878 964 1,018 1,020 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 A53 3.23 CLAIMS ON UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the United States Millions of dollars, end of period 2001 2002 TTyyppee ooff ccllaaiimm,, aanndd aarreeaa oorr ccoouunnttrryy 11999999'' 22000000'' 22000011 Sept. Dec. Mar. June Sept. Dec.P 1 Total 76,642 90,157 113,082 93,988r 113,082r 115,764 116,148 112,099 102,385 7 Payable in dollars 69,170 79,558 103,864 83,204' 103,864' 106,192 107,106 103,877 91,173 3 Payable in foreign currencies 7,472 10,599 9,218 10,784 9,218 9,572 9,042 8,222 11,212 By type 4 Financial claims 40,231 53,031 81,287 60,015 81,287 85,381 87,324 84,033 71,140 Deposits 18,566 23,374 29,801 22,391 29,801 41,813 42,136 38,074 27,076 6 Payable in dollars 16,373 21,015 27,850 19,888 27,850 40,002 40,323 36,382 24,689 7 Payable in foreign currencies 2,193 2,359 1,951 2,503 1,951 1,811 1,813 1,692 2,387 8 Other financial claims 21,665 29,657 51,486 37,624 51,486 43,568 45,188 45,959 44,064 9 Payable in dollars 18,593 25,142 46,621 32,076 46,621 39,553 41,875 42,734 39,935 10 Payable in foreign currencies 3,072 4,515 4,865 5,548 4,865 4,015 3,313 3,225 4,129 11 Commercial claims 36,411 37,126 31,795 33,973' 31,795' 30,383 28,824 28,066 31,245 1? Trade receivables 32,602 33,104 27,513 29,240' 27,513' 25,618 24,263 23,491 26,453 13 Advance payments and other claims 3,809 4,022 4,282 4,733 4,282 4,765 4,561 4,575 4,792 14 Payable in dollars 34,204 33,401 29,393 31,240' 29,393' 26,637 24,908 24,761 26,549 15 Payable in foreign currencies 2,207 3,725 2,402 2,733 2,402 3,746 3,916 3,305 4,696 By area or country Financial claims 16 Europe 13,023 23,136 26,118 23,069 26,118 35,933 36,863 32,007 28,822 17 Belgium and Luxembourg 529 296 625 372 625 751 797 656 722 18 France 967 1,206 1,450 1,682 1,450 3,489 3,921 3,854 3,247 19 Germany 504 848 1,068 1,112 1,068 4,114 3,972 4,292 4,244 70 Netherlands 1,229 1,396 2,138 954 2,138 3,253 3,995 4,024 3,648 71 Switzerland 643 699 589 665 589 308 1,010 1,135 383 22 United Kingdom 7,561 15,900 16,510 15,670 16,510 17,910 16,037 11,351 10,503 23 Canada 2,553 4,576 6,193 4,254 6,193 5,471 5,537 5,485 5,013 74 Latin America and Caribbean 18,206 19,317 41,201 26,099 41,201 35,001 37,511 38,822 29,401 75 Bahamas 1,593 1,353 976 649 976 1,197 1,332 715 976 76 Bermuda 11 19 918 80 918 611 704 1,157 724 77 Brazil 1,476 1,827 2,127 2,065 2,127 1,892 2,036 2,226 2,310 78 British West Indies 12,099 12,596 32,965 19,234 32,965 27,350 29,591 30,859 21,366 79 Mexico 1,798 2,448 3.075 2,910 3,075 2,777 2,823 2,871 2,917 30 Venezuela 48 87 83 80 83 79 60 71 99 31 Asia 5,457 4,697 6,430 5,274 6,430 6,489 5,826 6,121 5,483 32 Japan 3,262 1,631 1,604 1,761 1,604 2,009 1,093 1,421 1,212 33 Middle Eastern oil-exporting countries' 23 80 135 100 135 74' 73' 83' 79 34 Africa 286 411 414 428' 414 390 431 379 394 35 Oil-exporting countries2 15 57 49 83 49 51 64 29 25 36 Allother3 706 894 931 891 931 2,097 1,156 1,219' 2,027 Commercial claims 37 Europe 16,389 15,938 14,022 14,364' 14,022' 12,708 11,861 12,000 14,225 38 Belgium and Luxembourg 316 452 268 353' 268 272 207 254 249 39 France 2,236 3,095 2,921 3,061' 2,921' 2,883 2,828 2,972 3,165 40 Germany 1,960 1,982 1,658 1,973' 1,658' 1,198 1,163 1,158 1,207 41 Netherlands 1,429 1,729 529 843' 529 415 379 409 1,490 47 Switzerland 610 763 611 514 611 436 472 404 506 43 United Kingdom 5,827 4,502 3,833 3,564' 3,833' 3,579 3,387 3,236 3,750 44 Canada 2,757 3,502 2,818 3,076' 2,818' 2,760 2,752 2,623 2,794 45 Latin America and Caribbean 5,959 5,851 4,859 5,567' 4,859' 4,912 4,530 4,324 4,357 46 Bahamas 20 37 42 35 42 42 28 35 31 47 Bermuda 390 376 369 526 369 422 214 270 287 48 Brazil 905 957 954 1,176' 954' 837 829 862 752 49 British West Indies 181 137 95 124 95 73 26 12 19 50 Mexico 1,678 1,507 1,391 1,427' 1,391' 1,225 1,283 1,184 1,261 51 Venezuela 439 328 288 301 288 312 316 340 291 57 Asia 9,165 9,630 7,849 8,697' 7,849' 7,513 7,309 6,778 7,339 53 Japan 2,074 2,796 2,006 2,437' 2,006' 1,975 2,064 2,083 2,352 54 Middle Eastern oil-exporting countries' 1,573 1,016 833 892' 833' 653' 885' 808' 803 55 Africa 631 672 645 838 645 630 605 637 584 56 Oil-exporting countries2 171 180 88 170 88 109 94 107 95 57 Other3 1,537 1,533 1,602 1,431' 1,602' 1,860 1,767 1,704 1,946 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

A54 International Statistics • June 2003 3.24 FOREIGN TRANSACTIONS IN SECURITIES Millions of dollars 2003 2002 2003 TTrraannssaaccttiioonn,, aanndd aarreeaa oorr ccoouunnttrryy 22000011 22000022rr J F a e n b - . Aug. Sept.' Oct.' Nov.r Dec.' Jan.' Feb.f U.S. corporate securities STOCKS 1 Foreign purchases 3,051,332 3,202,907 412,699 257,265 206,729 297,181 264,359 216,659 212,558 200,141 2 Foreign sales 2,934,942 3,153,465 412,579 252,651 213,195 293,565 257,879 214,243 216,056 196,523 3 Net purchases, or sales (-) 116,390 49,442 136 4,614 -6,454 3,616 6,480 2,416 -3,482 3,618 4 Foreign countries 116,187 49,495 151 4,603 -6,449 3,610 6,473 2,400 -3,465 3,616 5 Europe 88,099 33,006 1,321 3,830 -5,146 2,187 4,407 4,883 -1,873 3,194 6 France 5,914 2,127 476 942 -924 982 -317 676 206 270 7 Germany 8,415 -113 -109 -312' -1,165 276 31 518 -56 -53 8 Netherlands 10,919 4,535 1,968 900 4 760 629 792 671 1,297 9 Switzerland 3,456 2,656 -1,709 -294' -931 -164 1,581 909 -719 -990 10 United Kingdom 38,493 15,173 -875 2,801 -1,228 1,403 2,062 784 -2,742 1,867 11 Channel Islands and Isle of Man1 -682' -245 -1 -33' -19 94 23 -18 2 -3 12 Canada 10,984 7,433 -280 1,336 -768 342 47 746 19 -299 13 Latin America and Caribbean -5,146' -15,424 -5,313 -3,831' -2,897 -2,866 2,692 -2,332 -3,072 -2,241 14 Middle East2 1,789 -1,287 -67 -42' 46 -90 -228 71 -48 -19 15 Other Asia 20,726 22,682 4,099 3,231 2,012 3,985 -765 -886 1,313 2,786 16 Japan 6,788 12,337 1,569 2,249 238 7 -959 -1,129 561 1,008 17 -354' -68 47 -26' 36 -18 -4 -20 38 9 18 Other countries 109 3,175 408 147 284 82 350 -22 182 226 19 Nonmonetary international and regional organizations 203 -47 -15 11 -5 6 7 16 -17 2 BONDS3 20 Foreign purchases 1,942,690 2,549,825 431,947 220,914' 208,602 217,402 259,305 207,380 224,521 207,426 21 Foreign sales 1,556,745 2,172,047 365,296 189,008' 183,671 185,366 218,351 178,510 180,746 184,550 22 Net purchases, or sales (-) 385,945 377,778 66,651 31,906r 24,931 32,036 40,954 28,870 43,775 22,876 23 Foreign countries 385,379r 377,515 66,960 31,875r 25,022 31,632 40,914 28,684 43,919 23,041 24 Europe 195,412 167,572 40,598 10,895' 11,758 16,532 17,116 10,526 24,301 16,297 25 France 5,028 3,771 1,084 483 252 1,089 383 —426 1,044 40 26 Germany 12,362 5,149 1,544 370' -390 -69 558 1,249 545 999 27 Netherlands 1,538 -394 819 55 -25 149 -59 -1 206 613 28 Switzerland 5,721 8,521 2,013 1,825 356 355 743 304 1,154 859 29 United Kingdom 152,772 109,836 19,105 3,690 7,374 9,852 8,812 6,768 12,279 6,826 30 Channel Islands and Isle of Man1 2,000 11,173 6,953 1,203 1,342 2,239 4,917 959 5,420 1,533 31 Canada 4,595 -1,023 -979 166 -377 540 -743 -2,180 -1,168 189 32 Latin America and Caribbean 77,019 82,837 203 9,706 3,464 4,339 5,471 7,379 6,564 -6,361 33 Middle East2 2,337' 2,315 633 578 40 196 387 -120 591 42 34 Other Asia 106,400 121,470 26,360 9,026 9,602 10,126 18,374 12,944 13,593 12,767 35 Japan 33,687 48,482 8,591 1,975 6,135 5,505 10,456 4,863 4,025 4,566 36 Africa 760 860 133 77 171 -2 56 28 53 80 37 Other countries -1,136' 3,498 36 1,427 370 -77 267 107 -9 45 38 Nonmonetary international and regional organizations 566 263 -291 31 -89 404 40 186 -136 -155 Foreign securities 39 Stocks, net purchases, or sales (-) -50,107' -1,611 -7,905 3,078' 765 -6,144 -979 -2,749 -5,640 -2,265 40 Foreign purchases 1,397,664 1,260,278 171,075 92,759' 87,083 100,763 101,821 81,804 90,560 80,515 41 Foreign sales 1,447,777 1,261,907 178,990 89,681' 86,318 106,919 102,802 84,555 96,200 82,790 42 Bonds, net purchases, or sales (-) 30,502 28,406 2,533 -1,731' 1,064 6,920 2,269 -5,143 -1,809 4,342 43 Foreign purchases 1,160,102 1,377,020 262,856 112,167 126,078 123,139 137,931 117,917 140,390 122,466 44 Foreign sales 1,129,600 1,348,614 260,325 113,916 125,014 116,219 135,662 123,074 142,201 118,124 45 Net purchases, or sales (-), of stocks and bonds -19,609r 26,777 -5,382 l,329r 1,829 764 1,288 -7,892 -7,449 2,067 46 Foreign countries -19,016r 26,814 -5,527 l,304r 1,851 711 1300 -7,918 -7,498 1,971 47 Europe -12,092' 15,407 -6,046 557' 1,393 674 6,105 -9,085 -4,621 -1,419 48 Canada 2,943 4,849 4,805 32' -577 -1,279 -153 712 4,070 735 49 Latin America and Caribbean 4,315 4,562 -6,939 -745' -519 -28 518 1,045 -7,837 898 50 Asia -11,851' 1,591 2,307 1,028 1,018 1,694 -5,244 -973 362 1,945 51 Japan -20,104' -9,101 -346 379 -858 13 -6,603 -2,021 -614 268 52 Africa -542' -361 -17 393 -21 104 100 40 -32 15 53 Other countries -1,733' 784 391 49 583 -432 0 363 590 -199 54 Nonmonetary international and regional organizations -573r -23 147 25 -18 53 -8 14 51 96 1. Before January 2001, data included in United Kingdom. 3. Includes state and local government securities and securities of U.S. government 2. Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, agencies and corporations. Also includes issues of new debt securities sold abroad by U.S. Saudi Arabia, and United Arab Emirates (Trucial States). corporations organized to finance direct investments abroad. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Securities Holdings and Transactions A55 3.25 MARKETABLE U.S. TREASURY BONDS AND NOTES Foreign Transactions1 Millions of dollars; net purchases, or sales (-) during period 2003 2002 2003 AArreeaa oorr ccoouunnttrryy 22000011 22000022'' Jan.- Feb. Aug.' Sept.' Oct.' Nov.' Dec.' Jan.' Feb.P 1 Total estimated 18,514 121,698 -2,953 4,347 21,946 6,742 21,097 14,290 1,783 -4,736 2 Foreign countries 19,200 119,687 -3,100 3,932 21,934 5,994 21,177 13,961 1,400 -4,500 3 Europe -20,596r 44,169 -6,617 973 5,666 838 8,847 3,186 891 -7,508 4 Belgium2 -582r 2,046 2,010 1,349 -122 -210 513 -187 3,371 -1,361 5 Germany -1,652' -3,910 -1,420 -1,963 -374 -451 1,658 1,610 -1,177 -243 6 Luxembourg2 462 -1,591 433 -6 -255 61 -121 -199 75 358 7 Netherlands -6,712r -17,020 -2,708 -2,131 957 -2,844 1,427 3,261 -4,076 1,368 8 Sweden -1,190 2,923 612 471 235 -197 1,652 902 422 190 9 Switzerland 1,412 -492 -1,124 -695 1,150 -1,713 2,389 -2,537 -74 -1,050 10 United Kingdom -7,261' 60,995 -1,595 3,927 6,665 5,071 -35 -2,721 1,313 -2,908 11 Channel Islands and Isle of Man3 -161' 714 0 444 -37 -104 -281 -76 -9 9 12 Other Europe and former U.S.S.R -4,824' 538 -2,747 -367 -2,491 1,287 1,691 3,173 1,074 -3,821 13 Canada -1,626' -5,182 -2,574 -1,891 -321 -2,431 3,165 1,028 -654 -1,920 14 Latin America and Caribbean 4,272 21,116 1,496 -11,839 7,753 7,219 -1,742 6,074 -1,888 3,384 15 Venezuela 290 -41 117 -5 -61 5 1 -67 20 97 16 Other Latin America and Caribbean 14,726 21,955 4,998 -7,436 5,516 4,485 319 1,652 2,675 2,323 17 Netherlands Antilles -10,736' -780 -3,609 -4,378 2,316 2,729 -2,064 4,495 -4,573 964 18 Asia 36,332 55,850 4,917 16,386 8,971 -46 10,607 3,626 2,630 2,287 19 Japan 16,114 30,730 9,092 7,081 12,569 -1,307 2,120 2,731 3,512 5,580 20 Africa -880 841 47 495 -87 12 -3 90 84 -37 21 Other 1,714 2,909 -331 -168 -16 428 333 -37 353 -684 22 Nonmonetary international and regional organizations -674' 2,011 147 415 12 748 -80 329 383 -236 23 International -290 1,642 40 418 -35 329 314 164 170 -130 24 Latin American Caribbean regional 41 3 -27 4 29 4 -1 0 -5 -22 MEMO 25 Foreign countries 19,200 119,687 -3,100 3,932 21,934 5,994 21,177 13,961 1,400 -4,500 26 Official institutions 3,474 15,131 1,796 635 -3,509 -547 16,577 6,708 -745 2,541 27 Other foreign 15,726 104,556 ^1,884 3,297 25,445 6,547 4,600 7,253 2,155 -7,039 Oil-exporting countries 28 Middle Easr 865 -3,902 -3,739 -792 -408 913 -121 -3,805 509 —4,248 29 Africa5 2' 29 0 2 1 0 1 55 0 0 1. Official and private transactions in marketable U.S. Treasury securities having an 3. Before January 2001, these data were included in the data reported for the United original maturity of more than one year. Data are based on monthly transactions reports. Kingdom. Excludes nonmarketable U.S. Treasury bonds and notes held by official institutions of foreign 4. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab countries. Emirates (Trucial States). 2. Before January 2001, combined data reported for Belgium and Luxembourg. 5. Comprises Algeria, Gabon, Libya, and Nigeria. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A56 International Statistics • June 2003 3.28 FOREIGN EXCHANGE RATES AND INDEXES OF THE FOREIGN EXCHANGE VALUE OF THE U.S. DOLLAR1 Currency units per U.S. dollar except as noted 2002 2003 Nov. Dec. Jan. Feb. Mar. Apr. Exchange rates COUNTRY/CURRENCY UNIT 1 Australia/dollar2 58.15 51.69 54.37 56.13 56.24 58.29 59.56 60.15 61.00 2 Brazil/real 1.8301 2.3527 2.9213 3.5924 3.6268 3.4375 3.5955 3.4567 3.1090 3 Canada/dollar 1.4855 1.5487 1.5704 1.5715 1.5592 1.5414 1.5121 1.4761 1.4582 4 China, P.R./yuan 8.2784 8.2770 8.2770 8.2772 8.2777 8.2775 8.2780 8.2773 8.2772 5 Denmark/krone 8.0953 8.3323 7.8862 7.4201 7.2874 6.9980 6.8920 6.8807 6.8381 6 European Monetary Union/euro3 0.9232 0.8952 0.9454 1.0013 1.0194 1.0622 1.0785 1.0797 1.0862 7 Greece/drachma 365.92 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 8 Hong Kong/dollar 7.7924 7.7997 7.7997 7.7994 7.7988 7.7994 7.7995 7.7991 7.7996 9 India/rupee 45.00 47.22 48.63 48.29 48.15 47.96 47.75 47.68 47.39 10 Japan/yen 107.80 121.57 125.22 121.61 121.89 118.81 119.34 118.69 119.90 11 Malaysia/ringgit 3.8000 3.8000 3.8000 3.8000 3.8000 3.8000 3.8000 3.8000 3.8000 12 Mexico/peso 9.459 9.337 9.663 10.195 10.225 10,622 10.945 10.905 10.589 13 New Zealand/dollar2 45.68 42.02 46.45 49.73 51.08 53.98 55.39 55.37 55.18 14 Norway/krone 8.8131 8.9964 7.9839 7.3157 7.1557 6.9138 7.0004 7.2760 7.2032 15 Singapore/dollar 1.7250 1.7930 1.7908 1.7653 1.7532 1.7363 1.7451 1.7551 1.7771 16 South Africa/rand 6.9468 8.6093 10.5176 9.6509 8.9479 8.6949 8.2858 8.0506 7.6634 17 South Korea/won 1,130.90 1,292.01 1,250.31 1,210.20 1,206.61 1,176.45 1,190.37 1,237.20 1,231.10 18 Sri Lanka/rupee 76.964 89.602 95.773 96.426 96.705 96.813 96.880 96.943 97.004 19 Sweden/krona 9.1735 10.3425 9.7233 9.0652 8.9303 8.6368 8.4837 8.5440 8.4314 20 Switzerland/franc 1.6904 1.6891 1.5567 1.4658 1.4388 1.3765 1.3602 1.3614 1.3783 21 Taiwan/dollar 31.260 33.824 34.536 34.673 34.799 34.571 34.734 34.721 34.824 21 Thailand/baht 40.210 44.532 43.019 43.353 43.318 42.773 42.897 42.783 42.929 23 United Kingdom/pound2 151.56 143.96 150.25 157.11 158.63 161.75 160.79 158.25 157.39 24 Venezuela/bolivar 680.52 724.10 1,161.19 1,358.61 1,328.29 1,714.45 1,736.21 1,600.00 1,600.00 Indexes4 NOMINAL 25 Broad (January 1997=100)5 119.68 126.08 127.19 126.33 125.70 124.21 124.12 123.56 122.54 26 Major currencies (March 1973=100)6 98.31 104.28 102.85 99.53 98.62 96.03 95.02 94.28 93.98 27 Other important trading partners (January 1997—100)7 130.34 136.36 141.42 144.85 144.87 145.72 147.35 147.26 145.15 REAL 28 Broad (March 1973-100)5 104.67r 110.71' 111.09' 109.95' 109.10' 107.89' 108.11' 107.91' 107.32 29 Major currencies (March 1973-100)6 103.62r 111.09r 109.71' 106.18' 104.94' 102.46' 101.80' 101.16' 101.04 30 Other important trading partners (March 1973-100)7 114.81' 119.48' 122.30' 124.26' 123.9^ 124.44' 125.96' 126.42' 125.07 1. Averages of certified noon buying rates in New York for cable transfers. Data in this 4. Starting with the March 2003 Bulletin, revised index values resulting from the periodic table also appear in the Board's G.5 (405) monthly statistical release. For ordering address, revision of data that underlie the calculated trade weights are reported. For more information see inside front cover. on the indexes of the foreign exchange value of the dollar, see Federal Reserve Bulletin, vol. 2. U.S. cents per currency unit. 84 (October 1998), pp. 811-818. 3. The euro is reported in place of the individual euro area currencies. By convention, the 5. Weighted average of the foreign exchange value of the U.S. dollar against the currencies rate is reported in U.S. dollars per euro. The bilateral currency rates can be derived from the of a broad group of U.S. trading partners. The weight for each currency is computed as an euro rate by using the fixed conversion rates (in currencies per euro) as shown below: average of U.S. bilateral import shares from and export shares to the issuing country and of a measure of the importance to U.S. exporters of that country's trade in third country markets. Euro equals 6. Weighted average of the foreign exchange value of the U.S. dollar against a subset of 13.7603 Austrian schillings 1,936.27 Italian lire broad index currencies that circulate widely outside the country of issue. The weight for each 40.3399 Belgian francs 40.3399 Luxembourg francs currency is its broad index weight scaled so that the weights of the subset of currencies in the 5.94573 Finnish markkas 2.20371 Netherlands guilders index sum to one. 6.55957 French francs 200.482 Portuguese escudos 7. Weighted average of the foreign exchange value of the U.S. dollar against a subset of 1.95583 German marks 166.386 Spanish pesetas broad index currencies that do not circulate widely outside the country of issue. The weight .787564 Irish pounds 340.750 Greek drachmas for each currency is its broad index weight scaled so that the weights of the subset of currencies in the index sum to one. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A57 Guide to Special Tables and Statistical Releases SPECIAL TABLES—Data Published Irregularly, with Latest Bulletin Reference Title and Date Issue Page Assets and liabilities of commercial banks March 31, 2002 August 2002 A58 June 30, 2002 November 2002 A58 September 30, 2002 February 2003 A58 December 31, 2002 May 2003 A58 Terms of lending at commercial banks May 2002 August 2002 A60 August 2002 November 2002 A60 November 2002 February 2003 A60 February 2003 May 2003 A60 Assets and liabilities of U.S. branches and agencies of foreign banks March 31, 2002 August 2002 A66 June 30, 2002 November 2002 A66 September 30, 2002 February 2003 A66 December 31, 2002 May 2003 A66 Pro forma financial statements for Federal Reserve priced services March 31, 2001 August 2001 A76 June 30,2001 October 2001 A64 September 30, 2001 January 2002 A64 Residential lending reported under the Home Mortgage Disclosure Act 1988-2000 September 2001 A64 1989-2001 September 2002 A58 Disposition of applications for private mortgage insurance 1997-2000 September 2001 A73 1998-2001 September 2002 A67 Small loans to businesses and farms 1996-2000 September 2001 A76 1996-2001 September 2002 A70 Community development lending reported under the Community Reinvestment Act 2000 September 2001 A79 2001 September 2002 A73 STATISTICAL RELEASES—A List of Statistical Releases Published by the Federal Reserve is Printed Semiannually in the Bulletin Issue Page Schedule of anticipated release dates for periodic releases June 2003 A66 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

58 Federal Reserve Bulletin • June 2003 Index to Statistical Tables References are to pages A3-A56, although the prefix "A" is omitted in this index. ACCEPTANCES, bankers (See Bankers acceptances) Federal National Mortgage Association, 28, 32, 33 Assets and liabilities (See also Foreigners) Federal Reserve Banks Commercial banks, 15-21 Condition statement, 10 Domestic finance companies, 30, 31 Discount rates (See Interest rates) Federal Reserve Banks, 10 U.S. government securities held, 5, 10, 11, 25 Foreign-related institutions, 20 Federal Reserve credit, 5, 6, 10, 12 Automobiles Federal Reserve notes, 10 Consumer credit, 34 Federally sponsored credit agencies, 28 Production, 42, 43 Finance companies Assets and liabilities, 30 Business credit, 31 BANKERS acceptances, 5, 10 Loans, 34 Bankers balances, 15-21 (See also Foreigners) Paper, 22, 23 Bonds (See also U.S. government securities) Float, 5 New issues, 29 Rates, 23 Flow of funds, 35-39 Business loans (See Commercial and industrial loans) Foreign currency operations, 10 Foreign deposits in U.S. banks, 5 Foreign exchange rates, 56 CAPACITY utilization, 40, 41 Foreign-related institutions, 20 Capital accounts Foreigners Commercial banks, 15-21 Claims on, 46, 49-51, 53 Federal Reserve Banks, 10 Liabilities to, 45^18, 52, 54, 55 Certificates of deposit, 23 Commercial and industrial loans Commercial banks, 15-21 GOLD Weekly reporting banks, 17, 18 Certificate account, 10 Commercial banks Stock, 5, 45 Government National Mortgage Association, 28, 32, 33 Assets and liabilities, 15-21 Commercial and industrial loans, 15-21 Consumer loans held, by type and terms, 34 INDUSTRIAL production, 42, 43 Real estate mortgages held, by holder and property, 33 Insurance companies, 25, 33 Time and savings deposits, 4 Interest rates Commercial paper, 22, 23, 30 Bonds, 23 Condition statements (See Assets and liabilities) Consumer credit, 34 Consumer credit, 34 Federal Reserve Banks, 7 Corporations Money and capital markets, 23 Security issues, 29, 55 Mortgages, 32 Credit unions, 34 Prime rate, 22 Currency in circulation, 5, 13 International capital transactions of United States, 44-55 Customer credit, stock market, 24 International organizations, 46, 47, 49, 52, 53 Investment companies, issues and assets, 30 Investments (See also specific types) DEBT (See specific types of debt or securities) Commercial banks, 4, 15-21 Demand deposits, 15—21 Federal Reserve Banks, 10, 11 Depository institutions Financial institutions, 33 Reserve requirements, 8 Reserves and related items, 4-6, 12 Deposits (See also specific types) LIFE insurance companies (See Insurance companies) Commercial banks, 4, 15-21 Loans (See also specific types) Federal Reserve Banks, 5, 10 Commercial banks, 15-21 Discount rates at Reserve Banks and at foreign central banks and Federal Reserve Banks, 5-7, 10, 11 foreign countries (See Interest rates) Financial institutions, 33 Discounts and advances by Reserve Banks (See Loans) Insured or guaranteed by United States, 32, 33 EURO, 56 MANUFACTURING Capacity utilization, 40, 41 Production, 42, 43 FARM mortgage loans, 33 Margin requirements, 24 Federal agency obligations, 5, 9-11, 26, 27 Member banks, reserve requirements, 8 Federal credit agencies, 28 Mining production, 43 Federal finance Monetary and credit aggregates, 4, 12 Debt subject to statutory limitation, and types and ownership of Money and capital market rates, 23 gross debt, 25 Money stock measures and components, 4, 13 Federal Financing Bank, 28 Mortgages (See Real estate loans) Federal funds, 23 Mutual funds, 13, 30 Federal Home Loan Banks, 28 Federal Home Loan Mortgage Corporation, 28, 32, 33 Federal Housing Administration, 28, 32, 33 Mutual savings banks (See Thrift institutions) Federal Land Banks, 33 OPEN market transactions, 9 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A59 PRICES Stock market, selected statistics, 24 Stock market, 24 Stocks (See also Securities) Prime rate, 22 New issues, 29 Production, 42, 43 Prices, 24 Student Loan Marketing Association, 28 REAL estate loans Banks, 15-21, 33 THRIFT institutions, 4 (See also Credit unions and Savings Terms, yields, and activity, 32 institutions) Type and holder and property mortgaged, 33 Time and savings deposits, 4, 13, 15-21 Reserve requirements, 8 Treasury cash, Treasury currency, 5 Reserves Treasury deposits, 5, 10 Commercial banks, 15-21 Depository institutions, 4-6 U.S. GOVERNMENT balances Federal Reserve Banks, 10 Commercial bank holdings, 15-21 U.S. reserve assets, 45 Treasury deposits at Reserve Banks, 5, 10 Residential mortgage loans, 32, 33 U.S. government securities Retail credit and retail sales, 34 Bank holdings, 15-21, 25 Dealer transactions, positions, and financing, 27 SAVING Federal Reserve Bank holdings, 5, 10, 11, 25 How of funds, 33, 34, 35-39 Foreign and international holdings and transactions, 10, 25, 55 Savings deposits (See Time and savings deposits) Open market transactions, 9 Savings institutions, 33, 34, 35-39 Outstanding, by type and holder, 25, 26 Securities (See also specific types) Rates, 23 Federal and federally sponsored credit agencies, 28 U.S. international transactions, 44-55 Foreign transactions, 54 Utilities, production, 43 New issues, 29 Prices, 24 Special drawing rights, 5, 10, 44, 45 VETERANS Affairs, Department of, 32, 33 State and local governments Holdings of U.S. government securities, 25 WEEKLY reporting banks, 17, 18 New security issues, 29 Rates on securities, 23 YIELDS (See Interest rates) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

60 Federal Reserve Bulletin • June 2003 Federal Reserve Board of Governors and Official Staff ALAN GREENSPAN, Chairman EDWARD M. GRAMLICH ROGER W. FERGUSON, JR., Vice Chairman SUSAN SCHMIDT BIES OFFICE OF BOARD MEMBERS DIVISION OF INTERNATIONAL FINANCE DONALD J. WINN, Assistant to the Board and Director KAREN H. JOHNSON, Director LYNN S. FOX, Assistant to the Board DAVID H. HOWARD, Deputy Director MICHELLE A. SMITH, Assistant to the Board THOMAS A. CONNORS, Associate Director WINTHROP P. HAMBLEY, Deputy Congressional Liaison DALE W. HENDERSON, Senior Adviser JOHN LOPEZ, Special Assistant to the Board RICHARD T. FREEMAN, Deputy Associate Director ROSANNA PIANALTO-CAMERON, Special Assistant to the Board STEVEN B. KAMIN, Deputy Associate Director DAVID W. SKIDMORE, Special Assistant to the Board WILLIAM L. HELKIE, Senior Adviser JON W. FAUST, Assistant Director LEGAL DIVISION JOSEPH E. GAGNON, Assistant Director J. VIRGIL MATTINGLY, JR., General Counsel WILLENE A. JOHNSON, Adviser SCOTT G. ALVAREZ, Associate General Counsel MICHAEL P. LEAHY, Assistant Director RICHARD M. ASHTON, Associate General Counsel D. NATHAN SHEETS, Assistant Director STEPHANIE MARTIN, Associate General Counsel RALPH W. TRYON, Assistant Director KATHLEEN M. O'DAY, Associate General Counsel ANN E. MISBACK, Assistant General Counsel DIVISION OF RESEARCH AND STATISTICS STEPHEN L. SICILIANO, Assistant General Counsel DAVID J. STOCKTON, Director KATHERINE H. WHEATLEY, Assistant General Counsel EDWARD C. ETTIN, Deputy Director CARY K. WILLIAMS, Assistant General Counsel DAVID W. WILCOX, Deputy Director MYRON L. KWAST, Associate Director OFFICE OF THE SECRETARY STEPHEN D. OLINER, Associate Director JENNIFER J. JOHNSON, Secretary PATRICK M. PARKINSON, Associate Director ROBERT DEV. FRIERSON, Deputy Secretary LAWRENCE SLIFMAN, Associate Director MARGARET M. SHANKS, Assistant Secretary CHARLES S. STRUCKMEYER, Associate Director JOYCE K. ZICKLER, Deputy Associate Director DIVISION OF BANKING SUPERVISION J. NELLIE LIANG, Assistant Director AND REGULATION S. WAYNE PASSMORE, Assistant Director RICHARD SPILLENKOTHEN, Director DAVID L. REIFSCHNEIDER, Assistant Director STEPHEN C. SCHEMERING, Deputy Director JANICE SHACK-MARQUEZ, Assistant Director HERBERT A. BIERN, Senior Associate Director WILLIAM L. WASCHER III, Assistant Director ROGER T. COLE, Senior Associate Director MARY M. WEST, Assistant Director WILLIAM A. RYBACK, Senior Associate Director ALICE PATRICIA WHITE, Assistant Director GERALD A. EDWARDS, JR., Associate Director GLENN B. CANNER, Senior Adviser STEPHEN M. HOFFMAN, JR., Associate Director DAVID S. JONES, Senior Adviser JAMES V. HOUPT, Associate Director THOMAS D. SIMPSON, Senior Adviser JACK P. JENNINGS, Associate Director MICHAEL G. MARTINSON, Associate Director DIVISION OF MONETARY AFFAIRS MOLLY S. WASSOM, Associate Director VINCENT R. REINHART, Director HOWARD A. AMER, Deputy Associate Director DAVID E. LINDSEY, Deputy Director NORAH M. BARGER, Deputy Associate Director BRIAN F. MADIGAN, Deputy Director BETSY CROSS, Deputy Associate Director WILLIAM C. WHITESELL, Deputy Associate Director DEBORAH P. BAILEY, Assistant Director JAMES A. CLOUSE, Assistant Director BARBARA J. BOUCHARD, Assistant Director WILLIAM B. ENGLISH, Assistant Director ANGELA DESMOND, Assistant Director RICHARD D. PORTER, Senior Adviser JAMES A. EMBERSIT, Assistant Director NORMAND R. V. BERNARD, Special Assistant to the Board CHARLES H. HOLM, Assistant Director WILLIAM G. SPANIEL, Assistant Director DAVID M. WRIGHT, Assistant Director WILLIAM C. SCHNEIDER, JR., Project Director, National Information Center Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A61 MARK W. OLSON DONALD L. KOHN BEN S. BERNANKE DIVISION OF CONSUMER DIVISION OF RESERVE BANK OPERATIONS AND COMMUNITY AFFAIRS AND PAYMENT SYSTEMS DOLORES S. SMITH, Director LOUISE L. ROSEMAN, Director GLENN E. LONEY, Deputy Director PAUL W. BETTGE, Associate Director SANDRA F. BRAUNSTEIN, Senior Associate Director JEFFREY C. MARQUARDT, Associate Director ADRIENNE D. HURT, Associate Director KENNETH D. BUCKLEY, Assistant Director IRENE SHAWN MCNULTY, Associate Director JOSEPH H. HAYES, JR., Assistant Director JAMES A. MICHAELS, Assistant Director EDGAR A. MARTINDALE III, Assistant Director TONDA E. PRICE, Assistant Director MARSHA W. REIDHILL, Assistant Director JEFF J. STEHM, Assistant Director OFFICE OF JACK K. WALTON II, Assistant Director STAFF DIRECTOR FOR MANAGEMENT OFFICE OF THE INSPECTOR GENERAL STEPHEN R. MALPHRUS, Staff Director SHEILA CLARK, EEO Programs Director BARRY R. SNYDER, Inspector General DONALD L. ROBINSON, Deputy Inspector General MANAGEMENT DIVISION WILLIAM R. JONES, Director H. FAY PETERS, Deputy Director STEPHEN J. CLARK, Associate Director DARRELL R. PAULEY, Associate Director DAVID L. WILLIAMS, Associate Director CHRISTINE M. FIELDS, Assistant Director BILLY J. SAULS, Assistant Director DONALD A. SPICER, Assistant Director DIVISION OF INFORMATION TECHNOLOGY MARIANNE M. EMERSON, Director MAUREEN T. HANNAN, Deputy Director TILLENA G. CLARK, Assistant Director GEARY L. CUNNINGHAM, Assistant Director WAYNE A. EDMONDSON, Assistant Director Po KYUNG KIM, Assistant Director SUSAN F. MARYCZ, Assistant Director SHARON L. MOWRY, Assistant Director RAYMOND ROMERO, Assistant Director ROBERT F. TAYLOR, Assistant Director Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

62 Federal Reserve Bulletin • June 2003 Federal Open Market Committee and Advisory Councils FEDERAL OPEN MARKET COMMITTEE MEMBERS ALAN GREENSPAN, Chairman Vacant, Vice Chairman SUSAN SCHMIDT BIES EDWARD M. GRAMLICH MICHAEL H. MOSKOW BEN S. BERNANKE JACK GUYNN MARK W. OLSON J. ALFRED BROADDUS, JR. DONALD L. KOHN ROBERT T. PARRY ROGER W. FERGUSON, JR. ALTERNATE MEMBERS THOMAS M. HOENIG SANDRA PIANALTO JAMIE B. STEWART, JR. CATHY E. MINEHAN WILLIAM POOLE STAFF VINCENT R. REINHART, Secretary and Economist CHRISTINE M. CUMMING, Associate Economist NORMAND R.V. BERNARD, Deputy Secretary ROBERT A. EISENBEIS, Associate Economist GARY P. GILLUM, Assistant Secretary MARVIN S. GOODFRIEND, Associate Economist MICHELLE A. SMITH, Assistant Secretary DAVID H. HOWARD, Associate Economist J. VIRGIL MATTINGLY, JR., General Counsel WILLIAM C. HUNTER, Associate Economist THOMAS C. BAXTER, JR., Deputy General Counsel JOHN P. JUDD, Associate Economist KAREN H. JOHNSON, Economist DAVID E. LINDSEY, Associate Economist DAVID J. STOCKTON, Economist CHARLES S. STRUCKMEYER, Associate Economist THOMAS A. CONNORS, Associate Economist DAVID W. WILCOX, Associate Economist DINO KOS, Manager, System Open Market Account FEDERAL ADVISORY COUNCIL L. PHILLIP HUMANN, President ALAN G. MCNALLY, Vice President DAVID A. SPINA, First District ALAN G. MCNALLY, Seventh District DAVID A. COULTER, Second District DAVID W. KEMPER, Eighth District RUFUS A. FULTON, JR., Third District JERRY A. GRUNDHOFER, Ninth District MARTIN G. MCGUINN, Fourth District Vacant, Tenth District FRED L. GREEN III, Fifth District GAYLE M. EARLS, Eleventh District L. PHILLIP HUMANN, Sixth District MICHAEL E. O'NEILL, Twelfth District JAMES ANNABLE, Co-Secretary WILLIAM J. KORSVIK, Co-Secretary Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A63 CONSUMER ADVISORY COUNCIL RONALD A. REITER, San Francisco, California, Chairman AGNES BUNDY SCANLAN, Boston, Massachusetts, Vice Chairman ANTHONY S. ABBATE, Saddlebrook, New Jersey J. PATRICK LIDDY, Cincinnati, Ohio JANIE BARRERA, San Antonio, Texas RUHI MAKER, Rochester, New York KENNETH R BORDELON, Baton Rouge, Louisiana OSCAR MARQUIS, Park Ridge, Illinois SUSAN BREDEHOFT, Cherry Hill, New Jersey ELSIE MEEKS, Kyle, South Dakota MANUEL CASANOVA, JR., Brownsville, Texas PATRICIA MCCOY, Cambridge, Massachusetts CONSTANCE K. CHAMBERLIN, Richmond, Virginia MARK PINSKY, Philadelphia, Pennsylvania ROBIN COFFEY, Chicago, Illinois ELIZABETH RENUART, Boston, Massachusetts DAN DIXON, Washington, District of Columbia DEBRA S. REYES, Tampa, Florida THOMAS FITZGIBBON, Chicago, Illinois BENSON ROBERTS, Washington, District of Columbia JAMES GARNER, Baltimore, Maryland BENJAMIN ROBINSON III, Charlotte, North Carolina CHARLES GATSON, Kansas City, Missouri DIANE THOMPSON, East St. Louis, Illinois LARRY HAWKINS, Houston, Texas HUBERT VAN TOL, Sparta, Wisconsin W. JAMES KING, Cincinnati, Ohio CLINT WALKER, Wilmington, Delaware EARL JAROLIMEK, Fargo, North Dakota THRIFT INSTITUTIONS ADVISORY COUNCIL KAREN L. MCCORMICK, Port Angeles, Washington, President WILLIAM J. SMALL, Defiance, Ohio, Vice President MICHAEL J. BROWN, SR., Ft. Pierce, Florida KIRK KORDELESKI, Bethpage, New York JOHN B. DICUS, Topeka, Kansas D. TAD LOWREY, Brea, California RICHARD J. DRISCOLL, Arlington, Texas GEORGE W. NISE, Philadelphia, Pennsylvania CURTIS L. HAGE, Sioux Falls, South Dakota KEVIN E. PIETRINI, Virginia, Minnesota OLAN O. JONES, JR., Kingsport, Tennessee ROBERT F. STOICO, Swansea, Massachusetts Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

64 Federal Reserve Bulletin • June 2003 Federal Reserve Board Publications For ordering assistance, write PUBLICATIONS, MS-127, Board Rates for subscribers outside the United States are as follows of Governors of the Federal Reserve System, Washington, DC and include additional air mail costs: 20551, or telephone (202) 452-3244, or FAX (202) 728-5886. You Federal Reserve Regulatory Service, $250.00 per year. may also use the publications order form available on the Board's Each Handbook, $90.00 per year. World Wide Web site (http://www.federalreserve.gov). When a FEDERAL RESERVE REGULATORY SERVICE FOR PERSONAL charge is indicated, payment should accompany request and be COMPUTERS. CD-ROM; updated monthly. made payable to the Board of Governors of the Federal Reserve Standalone PC. $300 per year. System or may be ordered via Mastercard, Visa, or American Network, maximum 1 concurrent user. $300 per year. Express. Payment from foreign residents should be drawn on a Network, maximum 10 concurrent users. $750 per year. 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, 2001. through October 1998. 723 pp. $20.00 each. ANNUAL REPORT: BUDGET REVIEW, 2001. 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 (also avail- 1994 December 1995 190 pp. $25.00 able in Spanish) 1990-95 November 1996 404 pp. $25.00 Consumer Handbook to Credit Protection Laws 1996-2000 March 2002 352 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 about a Bank (also available GUIDE TO THE FLOW OF FUNDS ACCOUNTS. January 2000. in Spanish) 1,186 pp. $20.00 each. In Plain English: Making Sense of the Federal Reserve FEDERAL RESERVE REGULATORY SERVICE. Loose-leaf; updated Making Sense of Savings 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 (also available in Spanish) per year. Keys to Vehicle Leasing (also available in Spanish) Securities Credit Transactions Handbook. $75.00 per year. Looking for the Best Mortgage (also available in Spanish) The Payment System Handbook. $75.00 per year. Privacy Choices for Your Personal Financial Information Federal Reserve Regulatory Service. Four vols. (Contains all When Is Your Check Not a Check? four Handbooks plus substantial additional material.) $200.00 per year. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A65 STAFF STUDIES: Only Summaries Printed in the 167. A SUMMARY OF MERGER PERFORMANCE STUDIES IN BANK- BULLETIN ING, 1980-93, AND AN ASSESSMENT OF THE "OPERATING PERFORMANCE" AND "EVENT STUDY" METHODOLOGIES, Studies and papers on economic and financial subjects that are of by Stephen A. Rhoades. July 1994. 37 pp. general interest. Staff Studies 1-158, 161, 163, 165, 166, 168, and 170. THE COST OF IMPLEMENTING CONSUMER FINANCIAL REGU- 169 are out of print, but photocopies of them are available. Staff LATIONS: AN ANALYSIS OF EXPERIENCE WITH THE TRUTH Studies 165-174 are available on line at www.federalreserve.gov/ IN SAVINGS ACT, by Gregory Elliehausen and Barbara R. pubs/staffstudies. Requests to obtain single copies of any paper or Lowrey. December 1997. 17 pp. to be added to the mailing list for the series may be sent to 171. THE COST OF BANK REGULATION: A REVIEW OF THE EVI- Publications. DENCE, by Gregory Elliehausen. April 1998. 35 pp. 172. USING SUBORDINATED DEBT AS AN INSTRUMENT OF MAR- 159. NEW DATA ON THE PERFORMANCE OF NONBANK SUBSIDI- KET DISCIPLINE, by Study Group on Subordinated Notes ARIES OF BANK HOLDING COMPANIES, by Nellie Liang and and Debentures, Federal Reserve System. December 1999. Donald Savage. February 1990. 12 pp. 69 pp. 160. BANKING MARKETS AND THE USE OF FINANCIAL SER- 173. IMPROVING PUBLIC DISCLOSURE IN BANKING, by Study VICES BY SMALL AND MEDIUM-SIZED BUSINESSES, by Group on Disclosure, Federal Reserve System. March 2000. Gregory E. Elliehausen and John D. Wolken. September 35 pp. 1990. 35 pp. 174. BANK MERGERS AND BANKING STRUCTURE IN THE UNITED 162. EVIDENCE ON THE SIZE OF BANKING MARKETS FROM MORT- STATES, 1980-98, by Stephen Rhoades. August 2000. 33 pp. GAGE LOAN RATES IN TWENTY CITIES, by Stephen A. 175. THE FUTURE OF RETAIL ELECTRONIC PAYMENTS SYSTEMS: Rhoades. February 1992. 11 pp. INDUSTRY INTERVIEWS AND ANALYSIS, Federal Reserve 164. THE 1989-92 CREDIT CRUNCH FOR REAL ESTATE, by Staff, for the Payments System Development Committee, James T. Fergus and John L. Goodman, Jr. July 1993. Federal Reserve System. December 2002. 27 pp. 20 pp. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

66 Federal Reserve Bulletin • June 2003 ANTICIPATED SCHEDULE OF RELEASE DATES FOR PERIODIC RELEASES OF THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM (PAYMENT MUST ACCOMPANY REQUESTS) Annual Annual Approximate Corresponding Period or date to Release number and title mail fax release Bulletin which data refer rate rate days1 table numbers2 Weekly Releases H.2. Actions of the Board: $55.00 n.a. Friday Week ended Applications and Reports previous Received Saturday H.3. Aggregate Reserves of $20.00 n.a. Thursday Week ended 1.20 Depository Institutions and previous the Monetary Base3 Wednesday H.4.1. Factors Affecting Reserve Balances $20.00 n.a. Thursday Week ended 1.11, 1.18 of Depository Institutions and previous Condition Statement of Wednesday Federal Reserve Banks3 H.6. Money Stock Measures3 $35.00 n.a. Thursday Week ended 1.21 Monday of previous week H.8. Assets and Liabilities of $30.00 n.a. Friday Week ended 1.26A-F Commercial Banks in the previous United States3 Wednesday H. 10. Foreign Exchange Rates3 $20.00 $20.00 Monday Week ended 3.28 previous Friday H. 15. Selected Interest Rates3 $20.00 $20.00 Monday Week ended 1.35 previous Friday Monthly Releases G.5. Foreign Exchange Rates3 $ 5.00 $ 5.00 First of month Previous month 3.28 G.15. Research Library— No charge n.a. First of month Previous month Recent Acquisitions G. 17. Industrial Production and $15.00 n.a. Midmonth Previous month 2.12, 2.13 Capacity Utilization3 $ 5.00 $ 5.00 Fifth working day Second month 1.55, 1.56 G.19. Consumer Credit3 of month previous $ 5.00 n.a. End of month Second month 1.51, 1.52 G.20. Finance Companies3 previous Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A67 Annual Annual Approximate Corresponding Period or date to Release number and title mail fax release Bulletin which data refer rate rate days1 table numbers2 Quarterly Releases E.2. Survey of Terms of Business $ 5.00 n.a. Midmonth of February, May, 4.23 Lending3 March, June, August, and September, and November December E.7. List of Foreign Margin Stocks No charge n.a. March and March and September September E. 11. Geographical Distribution of $ 5.00 n.a. 15th of March, Previous quarter Assets and Liabilities of June, Major Foreign Branches of September, and U.S. Banks December E. 15. Agricultural Finance Databook $ 5.00 n.a. End of March, January, April, June, July, and September, and October December E. 16. Country Exposure Lending $ 5.00 n.a. January, April, Previous quarter Survey3 July, and October Z. 1. Flow of Funds Accounts $25.00 n.a. Second week of Previous quarter 1.57, 1.58, of the United States: March, June, 1.59, 1.60 Flows and Outstandings3 September, and December 1. Please note that for some releases, there is normally a certain vari- 2. The data in some releases are also reported in the Bulletin statistical ability in the release date because of reporting or processing procedures. appendix. Moreover, for all series unusual circumstances may, from time to time, 3. These releases are also available on the Board's web site, result in a release date being later than anticipated. www.federalreserve.gov/releases. n.a. Not available. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

68 Federal Reserve Bulletin • June 2003 Maps of the Federal Reserve System EW YORK HAWAII LEGEND Both pages Facing page • Federal Reserve Bank city • Federal Reserve Branch city • Board of Governors of the Federal — Branch boundary Reserve System, Washington, D.C. NOTE The Federal Reserve officially identifies Districts 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

A69 1-A . - 2-B 3-C 5-E D ,. 4 _ Dp t tb h % NY 1MB Bahimafc MD • y f X -r Buffalo DE wv ^"^SSjStK^ NJ NY BOSTON NEW YORK PHILADELPHIA CLEVELAND RICHMOND 6-F 7-G 8-H •Nashfille MSISt^ Birmingham^ ^^fu —TN i^j^W jax?(Hkville •jjHF^Qemphis New Orleans mm. ATLANTA CHICAGO ST. LOUIS MINNEAPOLIS 10-J 1122--LL Oklahoma City KANSAS CITY VL San Aaitonu* ** „„ wwHHBBff .. ff jj ii MMMM DALLAS SSAANN FFRRAANNCCIISSCCOO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

70 Federal Reserve Bulletin • June 2003 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 James J. Norton Cathy E. Minehan Samuel O. Thier Paul M. Connolly NEW YORK* 10045 Peter G. Peterson William J. McDonough John E. Sexton Jamie B. Stewart, Jr. Buffalo 14240 Marguerite D. Hambleton Barbara L. Walter1 PHILADELPHIA 19105 Glenn A. Schaeffer Anthony M. Santomero Ronald J. Naples William H. Stone, Jr. CLEVELAND* 44101 Robert W. Mahoney Sandra Pianalto Charles E. Bunch Robert Christy Moore Cincinnati 45201 Dennis C. Cuneo Barbara B. Henshaw Pittsburgh 15230 Roy W. Haley Robert B. Schaub RICHMOND* 23219 Wesley S. Williams, Jr. J. Alfred Broaddus, Jr. Vacancy Walter A. Varvel Baltimore 21203 Owen E. Herrnstadt William J. Tignanelli1 Charlotte 28230 Michael A. Almond Dan M. Bechter1 ATLANTA 30303 Paula Lovell Jack Guynn David M. RatclifFe Patrick K. Barron James M. McKee1 Birmingham 35242 W. Miller Welborn Lee C. Jones Jacksonville 32231 William E. Flaherty Christopher L. Oakley Miami 33152 Brian E. Keeley James T. Curry III Nashville 37203 Whitney Johns Martin Melvyn K. Purcell1 New Orleans 70161 Dave Dennis Robert J. Musso1 CHICAGO* 60690 Robert J. Darnall Michael H. Moskow W. James Farrell Gordon R. G. Werkema Detroit 48231 Timothy D. Leuliette Glenn Hansen1 ST. LOUIS 63166 Charles W. Mueller William Poole Walter L. Metcalfe, Jr. W. LeGrande Rives Little Rock 72203 Vick M. Crawley Robert A. Hopkins Louisville 40232 Norman Pfau, Jr. Thomas A. Boone Memphis 38101 Gregory M. Duckett Martha Perine Beard MINNEAPOLIS 55480 Ronald N. Zwieg Gary H. Stern Linda Hall Whitman James M. Lyon Helena 59601 Thomas O. Markle Samuel H. Gane KANSAS CITY 64198 Richard H. Bard Thomas M. Hoenig Vacancy Richard K. Rasdall Denver 80217 Robert M. Murphy Maryann Hunter1 Oklahoma City 73125 Patricia B. Fennell Dwayne E. Boggs Omaha 68102 A.F. Raimondo Steven D. Evans DALLAS 75201 Ray L. Hunt Robert D. McTeer, Jr. Patricia M. Patterson Helen E. Holcomb El Paso 79999 Gail Darling Robert W. Gilmer3 Houston 77252 LupeFraga Robert Smith III1 San Antonio 78295 Ron R. Harris James L. Stull1 SAN FRANCISCO 94120 George M. Scalise Robert T. Parry Sheila D. Harris John F. Moore Los Angeles 90051 William D. Jones Mark L. Mullinix2 Portland 97208 Karla S. Chambers Richard B. Hornsby Salt Lake City 84125 H. Roger Boyer Andrea P. Wolcott Seattle 98124 Mic R. Dinsmore D.Kerry Webb1 *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 3. Acting Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis