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The
Federal
ReserveBank
of Philadelphia
Annual Report

About the cover:
These investors are in our Eastburn
Court, looking over the application
to open a Treasury Direct account.
Individuals also come into the Bank
every weekday to purchase Treasury
securities and savings bonds.

Contents:
President's Letter

1

1986in Retrospect

4

Directors

12

Officers

15

Advisory Councils

16

Statement of Condition

18

Earnings and Expenses
Operating Statistics

19
20

1986Annual Report

President'sLetter
The FederalReserveBank of
Philadelphia has split-level
responsibilities.One level is as a
teamplayer, a memberof a national
Systemthat makes decisionsand
takesactionsthat havean important
impact on the country as a whole.
The other is more localized. This
Bank also must provide leadership
and servicesto make the Third
District financial systemand, in
turn, the regional economywork
better.
Continued

I

Maybe it's not always true that what's good for the District is good for
the nation and vice versa, but in 1986 the Bank's crowning achievement
most certainly satisfied both our national and our close-to-home
responsibilities.
I refer to Treasury Direct. It is a brand new, nationwide book-entry
system for U. S. Treasury securities which this Bank has been planning
and developing for more than three years. In July we put Treasury
Direct into operation with hardly a hitch. The computers in our building
are linked to all Federal Reserve offices, and through them we are bringing Treasury Direct service to investors all over the country.

FirstVicePresident
RichardL. Smootand
PresidentEdwardG.
Boehne

It is an all-win situation. The increased efficiency of Treasury Direct
savesthe U. S. Treasury tens of millions of dollars, while it also gives the
nation's investors a lot of added safety and convenience. The Federal
Reserve System has gained an expanded role in an important financial
service, and this Bank winds up with a major new operation and the
nice feeling that the entire project was introduced on time and under
budget.
I like to think that Treasury Direct symbolizes the Bank's overall
performance in 1986 -a successful fusion of our national and local
responsibilities. Indeed 1986was a year in which the Bank made many
other important contributions on the System level and got the job done
in the District as well.
There are three System-wideconferencesthat provide leadership for the
Reserve Banks, and Philadelphia people were active in all of them. The
Conference of Presidents and the Conference of First Vice Presidents
were chaired in 1986 by me and the Bank's First Vice President, Dick
Smoot, respectively.The Conference of Chairmen and Deputy Chairmen
brings the leaders of the 12 Reserve Bank Boards together on a regular
basis, and our Chairman, Bob Landis, headed the important Employee
Benefits Committee.
In addition, our senior officers chair a number of other System committees, task forces and working groups, and the Bank's staff has made
significant contributions to System projects such as Check Truncation
and Inter-District Marketing.
On the Bank level, 1986was a year of operational achievement. Not
only was there Treasury Direct, but we began a two-year program that
ý

will revamp every major operating system in the Bank. We had a number of reasons for such a major overhaul - such as controlling our unit
costs and improving our efficiency - but our customers should only
seebetter services at reasonable prices.
For example, 1986brought more effective Automated Clearing House
and funds transfer services as well as improved check availability. I
believe that the Bank has reached the point where people naturally
expect us to do a superior job, no matter what, and doing even better
will be one of our biggest goals for 1987.
In a year that was highlighted by giant steps in automation, I am
pleased to say that the Bank was guided by the principle that technology
is for people and not the other way around. Several years ago we realized
that something so new and different as Treasury Direct could be a bit
scary for some less sophisticated investors, and we designed and carried
out a national educational campaign.
With so much change in the Bank's operating services crammed into
a short period, we acted again to improve people-to-people communication. In June 1986,we began a series of meetings with our customers
all over the District to talk with them about our automation plans and
to make sure we knew their needs during the changeover period.
Excellence in communication was also the 1986 theme of "YOU ARE
THIS BANK, " a motivational program for our employees.
This Bank, through its Directors, President, and Research Department
advisors, plays an important part in the determination of monetary
policy. We found that 1986was something of a good news-bad news
year for the national economy. On the one hand, interest rates declined,
and the economy expanded for the fourth year in a row. Inflation was
"oiled" down to the lowest annual rate in over a decade. On the other
hand, some industries and regions were left out of the expansion, notably in energy and agricultural related areas. Although the dollar declined,
it didn't have the hoped-for impact on trade deficits. These were major
disappointments nationally.
In contrast, the Third District economy continued to perform well in
1986.In terms of the unemployment rate, retail sales,and particularly
housing, the District outdid the nation. Likewise, reports from our farms
show little of the distress that still plagues the Midwest and other regions.
Third District banks also performed well relative to the nation, but
the big news in 1986was interstate banking. Pennsylvania and New
Jersey both passed legislation to permit reciprocal interstate banking
during the year (Delaware has allowed out-of-state banks to enter since
1981).Several interstate mergers had been announced between large
Pennsylvania and New Jersey banks by the year's end and intense
behind-the-scenes negotiations were continuing as various institutions
prepared to compete on the new playing field.
This Bank also made preparations for interstate banking in 1986.Our
Research Department studied its potential impact on financial markets
and the Supervision and Regulation Department readied itself for an
increasing number of applications.
In summary, I believe that the Bank got the job done on all levels of
its responsibility in 1986.We accomplished a lot, both as a member of a
national system and as a major provider of services to Third District
institutions. In a year marked by achievements in operations and automation breakthroughs, we tried to keep the focus on the needs of people
- the people we serve and those we employ.

IV. av-f-ý
Edward G. Boehne

3

1986In Retrospect
.
A year for the Bank is the sum
total of many events,largeand small,
and here we list a representative
sample.Most of the highlights are
included along with a selection
of other items, including some
reportsfrom the District economy.
The intent is to create a balanced
picture of our activities and

accomplishments.

The chronologyis divided into calendar
quarters to give a senseofflow and structure. Weregretthat we could mention by
name only a small fraction of thepeople
who made 1986 thefine year it wasfor
the Bank.

January Thru March
relationships between productivity
and the Federal deficit. Bank failure
costs, the trade deficit, "junk" bonds,
and what happened to M1 were
among the other topics featured
during the year.

At the first Board meeting of
the year Chairman Bob Landis welcomed two new directors: Clarence
McCormick, president of The Farmers
and Merchants National Bank,
Bridgeton, New Jersey,and Nicholas
Riso, president of Giant Food Stores,
Inc., Carlisle, Pennsylvania.

Through the days of winter, our
examiners were on the road to examine state member banks and inspect
bank holding companies.

Treasury Direct underwent intensive
testing as this nationwide book-entry
system for U. S. Treasury securities
began its final countdown. July was
the target month.

IF

Productionof the
TreasuryDirectvideo
usedthroughoutthe
System.

Almost 1,400people toured the
Bank during the first three months.
They were escorted by the 10 retired
employees in our successful part-time
guide program.

In the auditorium, the Bank's
Gospel Choir gave a concert in honor
of Martin Luther King, Jr. This was
one of 12 concerts during the year, six
of which featured students from the
Curtis Institute of Music.

The Federal Safety Council, Neighborhood Housing Services, Trust
Officers Association, and Minority
Business Women were among the
outside groups that used the Bank's
facilities in the first three months
of 1986.We make meeting rooms
available to appropriate groups that
are sponsored by one of this Bank's
officers.

After a series of explanatory
meetings around the District, we
implemented a new program to
reduce risks that may arise when
large volumes of funds are transferred
by wire.

Senior V. P. Jim Gaylord became
the Chairman of the System Subcomittee on Personnel, which reviews
benefits and other programs.
The first President's Idea Exchange
of the year covered how to be a better
listener. Dealing with stress was
another topic in this managementlevel series.

fromthe Curtis
Students
Instituteof Musicplay
to a full housein our
auditorium.

Our President, Ed Boehne, presided
over a meeting of the Conference of
Federal Reserve Bank Presidents in
the Board Room. As Chairman of the
Conference for 1986,he conducted a
total of seven meetings.

The Bank offered HelpFinders
confidential service to officers and
employees to assist with solutions to
personal problems.

In February, we became one of the
first four Reserve Banks to support
active trading of mortgage-backed
securities.

The January/February issue of the
Bank's BusinessReviewcame out with
studies of the business cycle and of

5

mkloý

Employees
fromother
ReserveBankslearn
TreasuryDirect
procedures.

showingsin southeasternPennsylvania,
central New Jersey,and Delaware.

The Federal Reserve System agreed
to comply with the spirit of the
Gramm-Rudman deficit reduction
effort and, early in the year, this Bank
cut $1.2 million from its 1986budget.

Consumersboostedthe economyas
retail salesregisteredbig gains over 1985,
in somecasesmore than threetimes the
national increase.

Employment increased in all Third
District states, with especially strong

April Thru June
Check information servicesfor paying banks were expanded and now
include 20 institutions, up from 12 a
year ago.

First Vice President Dick Smoot
chaired a Conference of First Vice
Presidents' meeting at this Bank.
Reserve Banks' budget policy was a
key item on the agenda. Another conference meeting was held in the Bank
in November.

The Bank's Board held a joint meeting with the directors of the Boston
Reserve Bank in that city.

We began a special survey to evaluate our Fedline service and training.
Fedline was introduced in 1985to link
smaller institutions to this Bank's
mainframe via personal computers.

i

The 41st annual series of field meetings opened in Danville, Pennsylvania.
Eight more of these dinner meetings
for commercial bank directors and
officers were held around the District
in April and May. Attendance averaged 150.

jjlA
I

ii
lI ý:

A "meet-the-artist"
receptionin the
EastburnCourt.

New Automated Clearing House
services were installed on schedule.
ACH volume continued to grow rapidly in 1986,and the Bank purchased
additional hardware for further
expansion.
Federal judges from the Third
Circuit came to the Bank for a daylong seminar on Economics and the
Law, which we co-sponsored with the
University of Pennsylvania.

Onein a seriesof
meetingswith bankers
to explain new
electronic services.

First-line supervisors in various
departments attended a series of
seminars conducted by our Training
Department.

In April, the District's 100th bank
holding company was formed; six
years ago only 25 such companies
existed here.

ýý

..... t

For the fourth year in a row, we
hosted a reception for newly natural-

ized citizens. After taking their oaths
in the Federal Court House, they
came to the Bank for coffee and
sweets.

Larry Murdoch, V.P. and Secretary,
chaired the System Subcommittee on
Public Information meeting in Seattle,
Washington. The main order of business was educating investors about
Treasury Direct.

Fedline capabilities were extended
to include receipt of Automated
Clearing House payments.

6

ý'
Clippingcouponsis
one of our Fiscal
Department
services.

:-ý

TraceyHambeauof the Checks
Department
sortsreturnitems.

7

EdCoiaand MaryLabaree,leaders
in this Bank'sdevelopment
of the
Treasury
DirectBook-entry
Securities
System,discussthe department's
operations.

10

The Human ResourcesDepartment
began a series of meetings for employees to explain the impact of the new
tax legislation on Bank benefits.

At the November Board meeting,
Ed Boehne and Dick Smoot reported
to directors on the state of the Bank.
They said that most objectives for
1986had been met and predicted that
the Bank would achieve its net revenue
targets for the year while keeping
expenditures below targeted GrammRudman budget levels. It did.

George Butler, Chairman of the
First Pennsylvania Bank, completed
his serviceas this Bank's representative
on the Federal Advisory Council. The
council, which consists of a prominent
banker from each Federal Reserve
District, meets four times a year with
the Fed's Governors in Washington.

Jim McGowan
of Temple
University,who doesn'tlet
his wheelchair keep him
fromskydiving,sailplaning
to swimthe
andattempting
EnglishChannel,signs
autographsas he helps
kick off the Bank'sUnited
Waycampaign.

Dynamic Calculated Availability
became a reality on November 14 at
5:00 p. m. This is a new program that
provides many check depositors with
improved credit availability at a lower
price. It came about because we now
can analyze each individual check in
a mixed deposit according to the location of the bank on which it is drawn.

Gus Adack, Senior V. P., reported
that checks, Automated Clearing
House, noncash, and cash operations
all achieved full cost recovery in
1986,and the Bank as a whole did
better than expected, thanks to costcontrol and volume growth, particularly in checks.
We announced a new policy for
pricing various consumer publications,
and other Reserve Banks will be
watching our experience in 1987.

AnnieWardhelps a
customerfill out a
savingsbond
purchaseapplication.

On December 29, the Meridian
Bank joined the Federal Reserve as a
state member. In addition, four other
banks applied for membership in 1986.

Ted Crone, our top regional economist, took over as host for the MIT
Enterprise Forum, which meets regularly in our auditorium to promote
the development of new firms.

NineteenHundred Eighty-Six ended
on a positive note.All threestatesin the
District had unemployment rates well
below the national average.Even the
manufacturing sectorwasshowing signs
of improvement,and the Bank's survey
of manufacturersshowedincreasesin
employment.

In the latter part of 1986,Manager
Bill Reardon and more than 30
employees from eight departments
were working to develop the Bank's
new Integrated Accounting System.
Scheduled for introduction in 1987,it
will increase standardization among
Reserve Banks which, in turn, should
help the System accommodate interstate banking.

In the CashDepartment,
workerscountand
verify currencyfrom
banksin the 3rd District
with the help of highspeedmachinery.

Sales in the Savings Bond department boomed in 1986,up more than
30 percent. In the last week of October
alone, Camille Ochman and her staff
received more than 10,000applications
to buy bonds.

11

Directors,Officers
And
Advisory Councils
In late 1986, Nevius M Curtis,
chairman and chief executiveofficer
of Delmarva Power and Light Co.
of Wilmington, Delaware, was appointed chairman of the board. He
replacesRobert M Landis, whose
term expired at the end of 1986.
GeorgeE. Bartol, III, chairman
and chief executive officer of Hunt
Manufacturing Co. of Philadelphia,
was named deputy chairman of the
board, a position previously held
by Mr. Curtis.

12

Two new directors also were selected for terms beginning January 1,1987.
George A. Butler, chairman and chief executive officer of First Pennsylvania
Bank and First Pennsylvania Corp. of Philadelphia, was elected a Class A
director by large member banks. He replaced John H. Walther. Peter A.
Benoliel, chairman of the board of Quaker Chemical Corp. of Conshohocken,
Pennsylvania, was appointed to a term as a Class C director, filling the seat
formerly held by Robert M. Landis.

IncomingChairman
NeviusM. Curtis,(left)
andoutgoingChairman
RobertM. Landis.

Board Of Directors
Chairman
Robert M. Landis
Partner, Dechert, Price &
Rhoads
Philadelphia, PA
Deputy Chairman
Nevius M. Curtis
Chairman and Chief
Executive Officer
Delmarva Power & Light
Company
Wilmington, DE
George E. Bartol, III
Chairman, Hunt
Manufacturing Company
Philadelphia, PA

Clarence D. McCormick
President, The Farmers and
Merchants National Bank
Bridgeton, NJ
Nicholas Riso
President and Chief
Executive Officer
Giant Food Stores, Inc.
Carlisle, PA
Charles F. Seymour
Chairman and Chief
Executive Officer
Jackson-Cross Company
Philadelphia, PA

13

Carl E. Singley
Dean and Professor of Law
Temple University School
of Law
Philadelphia, PA
Ronald H. Smith
President and Chief
Executive Officer
CCNB Bank, N.A.
New Cumberland, PA
John H. Walther
Chairman and Chief
Executive Officer
New Jersey National Bank
Pennington, NJ

DirectorsGeorge
E. Bartol,III, and
CharlesF. Seymour
(seated,left to right),
andCarlE. Singley,
RonaldH.Smith,
andJohn H.Walther
(backrow).

DirectorsClarence
D. McCormickand
Nicholas Riso.

14

Officers
In official actions in 1986,Edward J. Coia was promoted to Vice President;
Eugene E. Hendrzak became Assistant Vice President, Accounting; Theodore
M. Crone and Robert H. DeFina both were named Research Officer and
Economist; Richard A. Sheaffer was promoted to Securities Operations Officer;
Mary Labaree was named Assistant Vice President, Treasury Direct; and Marie
Tkaczyk was appointed Systems Development Officer, Computer Services.
J. Warren Bowman, Jr.,joined the Bank as Vice President of Automation
Planning and Administrative Services.
In new official assignments, Vish Viswanathan became Vice President, Check
Operations; James B. Duffy was named Vice President, Cash Operations; and
Judith H. Helmuth became Quality Assurance Officer, Business Planning and
Development.
Edward G. Boehne
President
Richard L. Smoot
First Vice President
Konstanty G. Adack
Executive Vice President
Thomas K. Desch
Senior Vice President and
Lending Officer
Donald F. Doros
Senior Vice President
James F. Gaylord
Senior Vice President
Hiliary H. Holloway
Senior Vice President and
General Counsel
Richard W. Lang
Senior Vice President and
Director of Research
William H. Stone, Jr.
Senior Vice President
Ronald D. Watson
Senior Vice President
J. Warren Bowman, Jr.
Vice President
Edward J. Coia
Vice President
Peter M. DiPlacido
Vice President
James B. Duffy
Vice President
Ronald G. Foley
Vice President
Malcolm T. Humphrey
Vice President
Donald J. McAneny
Vice President and General
Auditor
Lawrence C. Murdoch, Jr.
Vice President and
Secretary
Terence B. O'Brien
Vice President
Lawrence C. Santana, Jr.
Vice President
Vish P. Viswanathan
Vice President

Jack P. Besse
Assistant Vice President
Robert J. Bucco
EFT Services Officer
James E. Bums
Planning Officer and
Assistant Secretary
Theodore M. Crone
Research Officer and
Economist
Robert H. DeFina
Research Officer and
Economist
Robert A. Dobie
Assistant Vice President
Patrick L. Donahue
Financial Services Officer
Robert N. Downes, Jr.
Applications Officer
William Evans, Jr.
Technical Services Officer
Edward J. Fox
National Account Officer
Judith H. Helmuth
Quality Assurance Officer
Eugene E. Hendrzak
Assistant Vice President
Jerry Katz
Assistant Vice President
Alan L. Kiel
Staffing and Development
Officer
Robert H. Klein
Assistant Vice President
Mary M. Labaree
Assistant Vice President
Thomas P. Lambinus
Financial Accounting
Officer
Edward M. Mahon
Assistant Counsel
Frederick M. Manning
Assistant Vice President
and Community Affairs
Officer

15

Stephen A Meyer
Research Officer and
Economist
Janice M. Moulton
Research Officer and
Economist
Joseph J. Ponczka
Assistant Vice President
Edward G. Rutizer
Assistant Vice President
Louis N. Sanfelice
Assistant Vice President
and Assistant Secretary
John B. Shaffer
Assistant General Auditor
Richard A. Sheaffer
Securities Operations
Officer
Ronald R. Sheldon
Data Services Officer
Charles J. Sullivan, Jr.
Assistant Vice President
JoAnne Tarnoff
Automation Planning
Officer
Marie Tkaczyk
Systems Development
Officer
Elizabeth S. Webb
Assistant Counsel
Bernard Wennemer
Examination Review
Of
Officer

Advisory Councils
The advisory councils created by this Bank's Board of Directors facilitate
our communication with vital sectors of the regional economy.
Each council consists of 12 members drawn from throughout the District.
The councils normally meet at least twice a year with President Boehne and
other high-ranking executives from the Bank to exchange information and
discuss problems and needs.
There are now four advisory councils. The 1986membership is listed below.

Credit Union
Advisory Council
Chairman

Richard M. Stoops
Manager
Nylon Capital Federal
Credit Union
Seaford, DE
Deputy Chairman
Peggy J. Bosma
Manager
Letterkenny Federal Credit
Union
Chambersburg, PA
Betty L. Baker
Manager
Delaware State Employees
Federal Credit Union
Dover, DE
Joseph Duffy
Manager
Philadelphia Inquirer and
Daily News Employees
Federal Credit Union
Philadelphia, PA
Milton E. Grosmick
President
Kimble Federal Credit
Union
Vineland, NJ
Carl W. Knowlden
Manager
WAT Federal Credit Union
Williamsport, PA
John Ladd
Manager
609Area Federal Credit
Union
Moorestown, NJ
Carolyn O'Brien
Treasurer/Manager
Princeton University
Employees Federal Credit
Union
Princeton, NJ
Michael R. Prettyman
Treasurer
Defense Activities Federal
Credit Union
Mechanicsburg, PA
Glenn Stuart, Jr.
President/General Manager
Wybro Federal Credit
Union
Paoli, PA

Charles T. Williams
President
Citadel Federal Credit
Union
Thorndale, PA
Virginia Williams
Treasurer/Manager
Bridgeton Onized Federal
Credit Union
Bridgeton, NJ

NonmemberBank
Advisory Council
Chairman
John D. Wickert
Chairman and CEO
Dauphin Deposit Bank &
Trust Company
Harrisburg, PA
Deputy Chairman
Richard M. Linder
Chairman and President
The Drovers and
Mechanics Bank
York, PA
Theodore D. Bessler
President and CEO
Garden State Bank
Jackson, NJ
John R. Beyer
President and CEO
Mid-State Bank and Trust
Company
Altoona, PA
John R. Howell
President
First Valley Bank
Bethlehem, PA
Robert M. Hoyt
Chairman, President
and CEO
SussexTrust
Laurel, DE
Roy T. Peraino
Chairman and CEO
Continental Bank
Philadelphia, PA
F. Parker Renelt
President and CEO
Citizens State Bank
Forked River, NJ
William F. Sharp, Jr.
President and CEO
Lenape State Bank
West Deptford, NJ

16

Bernard J. Taylor, II
Chairman and CEO
Wilmington Trust Company
Wilmington, DE
David Tressler
Chairman and CEO
Northeastern Bank of
Pennsylvania
Scranton, PA
RG. Zullinger
President
Farmers and Merchants
Trust Company of
Chambersburg
Chambersburg. PA

Small Business/
Agriculture
Advisory Council
Chairman
John H. Wright
Wright's Motor Sales
Company of Hazleton
Hazleton, PA
Deputy Chairman
Donald Lynch
Animal Health Sales
Selbyville, DE
Roy L. Bomberger
Bomberger's Store, Inc.
Elm, PA
Sandra Graffius
Milroy Enterprises, Inc.
Sinking Springs, PA
Joseph R Hartle, Jr.
Lonely Spot Farm
Bellefonte, PA
Donald G. Hershey
Hershey Farms
Lancaster, PA
Willie Johnson
Fidelity Systems
Philadelphia, PA
Dean Pappas
Clement Pappas &
Company, Inc.
Seabrook, NJ
Ian Sydel
Sydel's Egg Farm
Hartley, DE
Charles A. Wiggs
Town and Country Sheet
Metal Corp.
Hightstown, NJ
Robert A. Winner
Pleasant Acres Dairy Farm
Moorestown, NJ
John Yahner
Yahner Brothers Farm
Loretto, PA

Wendell T. Breithaupt
President and CEO
Trenton Savings Fund
Society
Trenton, NJ
Robert J. Colacicco
President
South Jersey Savings and
Loan Association
Turnersville, NJ
Armondo Felicetti
President
Fidelity Federal Savings
and Loan Association
Philadelphia, PA
Edward L. Frampton
President
First Federal Savings and
Loan Association
Pottstown, PA
David W. Lindstrom
President
Franklin Savings and Loan
Association
Salem, NJ
Joseph J. McLaughlin
President and CEO
Beneficial Mutual Savings
Bank
Philadelphia, PA
Oliver H. Reed, Jr.
Assistant Secretary
Peoples-Thrift Building
and Loan Association
Norristown, PA
Robert H. Trewhella
President
First Federal Savings and
Loan Association
Harrisburg, PA
Paul W. Williams
President and CEO
First Federal Savings and
Loan Association
Hazleton, PA

Thri t Institutions
Advisory Council
Chairman
Ralph O. Williams
Chairman, President
and CEO
First Federal Savings and
Loan Association of
Delaware
Wilmington,
DE
Deputy Chairman
Stephen G. Harris, Jr.
President and CEO
Artisans' Savings Bank
Wilmington,
DE

Lynn S. Baker
President
First Federal Savings Bank
Hanover, PA

17

Statementof Condition
ASSETS

DECEMBER

Gold certificate account
Special drawing rights certificates
Other cash

31,1986

DECEMBER

31,1985

$ 431,000,000
162,000,000
20,397,852

$ 483,000,000
195,000,000
22,854,965

Loans and securities:
Discounts and advances
Federal Agency obligations
United States Government
securities
Total loans and securities

178,250,000
250,690,569

154,362,000
288,124,345

6,327,830,175
$6,756,770,744

6,226,478,136
$6,668,964,481

Other assets:
Cash items in processof collection
Bank premises-net
Operating equipment-net
All other
Interdistrict settlement account
Total assets

596,827,502
46,842,992
14,978,258
535,849,077
(466,304,297)
$8,098,362,128

532,997,108
48,284,412
14,136,161
458,415,701
(651,023,785)
$7,772,629,043

LIABILITIES AND CAPITAL
Note liabilities:
Federal Reserve notes

$5,513,225,564

$5,869,593,020

Deposits:
Reserve accounts of depository
institutions
U.S. Treasury-general account
Foreign
All other
Total deposits

$1,944,852,395
0
6,900,000
8,334,284
$1,960,086,679

$1,136,476,114
0
7,350,000
28,147,423
$1,171,973,537

Other liabilities:
Deferred availability cash items
All other
Total liabilities

381,505,200
70,613,685
$7,925,431,128

485,284,275
80,686,411
$7,607,537,243

86,465,500
86,465,500

82,545,900
82,545,900

$8,098,362,128

$7,772,629,043

ACCOUNTS

Capital accounts:
Capital paid in
Surplus
Total liabilities and capital
accounts

18

Earnings and Expenses
1986
Current earnings:
From U.S. Government securities
From discounts, advances and
miscellaneous sources
From services to depository
institutions
Total current earnings

1985

$532,214,470

$580,130,971

20,900,972

13,582,924

27,488,236
$580,603,678

25,021,004
$618,734,899

Net expenses:
Operating expenses (after
deducting reimbursable or
recoverable expenses)
Cost of earnings credits
Total net expenses

$ 51,969,075
8,790,331
$ 60,759,406

$ 50,756,030
8,966,615
$ 59,722,645

Current net earnings

$519,844,272

$559,012,254

$ 2,210,987

$ 3,391,633

90,648,998

59,292,121

3,225
$ 92,863,210

4,868
$ 62,688,622

$ 4,522,900
5,848,170

$ 3,747,700
5,869,244

Additions to current net earnings:
Gain on sales of Government
securities
Gain on foreign currency
transactions
Miscellaneous nonoperating
income
Total additions
Deductions from current net
earnings:
Assessment by the Board of
Governors:
Board expenditures
Federal Reserve currency
Loss on foreign currency
transactions
Miscellaneous nonoperating
expenses
Total deductions

00

Net additions
Net earnings before payment to
U. S. Treasury
Dividends paid
Paid to U. S. Treasury (interest
on Federal Reserve notes)
Transferred to Surplus, additions

"Nonreimbursed Treasury services

19

5,913,742*
$ 16,284,812

297,516
$ 9,914,460

$ 76,578,398

$ 52,774,162

$596,422,670

$611,786,416

$ 4,964,654

$ 4,852,310

587,538,416
3,919,600
$596,422,670

604,330,206
2,603,900
$611,786,416

Operating Statistics
1986
Millions of Dollars
Loans to depository institutions
Currency received and counted
Coin received and counted
Checks handled:
U. S. Government checks
All other
Issues, redemptions and exchanges
of U. S. Government securities
Transfers of funds
Food stamps redeemed
Thousands of Items Processed
Loans to depository institutions
Currency received and counted
Coin received and counted
Checks handled:
U. S. Government
All other
Issues, redemptions and exchanges
of U. S. Government securities
Transfers of funds
Food stamps redeemed

'Unrounded data

$

5,701
13,199
169

1985
$

5,003
12,290
162

23,919
665,726

25,413
579,663

3,888,293
5,527,775
421

2,457,929
4,753,287
434

1,344*
1,015,700
1,010,300

1,222*
988,400
944,300

29,500
803,500

29,100
720,000

14,500
3,200
86,300

13,800
2,600
99,300

Designby NGS Associates
Color photography by John McGrail PhotographyInc.
Black and whitephotography by Anne Griffith -McNally and Jane Hinkle
Typesettingby TerryRussell
Printed by the FederalReserveBank of Philadelphia


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102