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Table of Contents □ □ □ EQ PRESIDENT'S LETTER First Vice President's Letter News and Views: The Third District Economy Directors, Officers and Advisory Councils Statement of Condition 0 El Earnings and Expenses Operating Statistics The Federal Reserve Bank of Philadelphia President's Letter UR NATION’S ECONOMY GREW AT A MODEST PACE IN 1 992, AND BY YEAR-END THE O PROSPECTS FOR SUSTAINABLE GROWTH HAD SIGNIFICANTLY IMPROVED. Third District, HERE IN THE we also began to see signs of expansion last year, not every sector or AREA IS GROWING YET, BUT I SENSE THAT OVERALL BUSINESS ACTIVITY IS ON THE UPSWING. Once a region heavily dependent on manufacturing, the oped A MUCH MORE DIVERSIFIED ECONOMIC BASE IN RECENT YEARS. Third District has devel IN THE EARLY 1 970S, MORE THAN ONE-THIRD OF THE JOBS IN THE THREE DISTRICT STATES WERE IN MANUFACTURING. BY THE LATE 198OS, THAT PROPORTION HAD DECLINED TO LESS THAN ONE-FIFTH. TODAY, THE PATTERN OF District employment in agriculture, construction, manufacturing and the services indus tries CLOSELY MATCHES THAT OF THE NATION. WITH DIVERSIFICATION, OUR DISTRICT ENJOYED SOLID GROWTH DURING THE EXPANSION OF THE 1980S. JOB GROWTH WAS RELATIVELY STRONG AND, BY THE END OF THE DECADE, UNEMPLOY MENT RATES FOR THE DISTRICT STATES FELL BELOW THE NATIONAL AVERAGE. 2 The Federal Reserve Bank of Philadelphia Unfortunately, neither the economic diversification nor kets OF THE late 1980s could shield us the strong labor mar from the recession and slow recovery that have PLAGUED THE NATION THUS FAR IN THE 1 990S. INDEED, THE THIRD DISTRICT HAS SUFFERED A MORE SERIOUS RECESSION AND SLOWER RECOVERY THAN SOME OTHER PARTS OF THE COUNTRY. BUT IN THE FALL OF LAST YEAR, WE BEGAN TO SEE SIGNS THAT THE DISTRICT IS ON THE ROAD TO SUSTAINED GROWTH. RETAIL SALES PICKED UP. CONSUMERS BEGAN SHOWING MORE CONFIDENCE, AND THE PACE OF THIRD DISTRICT EMPLOYMENT EDGED UP SLIGHTLY DURING THE FOURTH QUARTER, AND AS WE MOVED INTO 1993, OUR REGULAR SURVEYS INDICATED AN IMPROVEMENT IN THE OVERALL LEVEL OF ECONOMIC ACTIVITY. WE ALSO SEE CONTINUED IMPROVEMENT IN THE ENVIRONMENT FOR BANK LENDING. HAVE IMPROVED THEIR CAPITAL POSITIONS AND REDUCED THEIR NONPERFORMING LOANS. DEMAND FROM SMALL AND MEDIUM-SIZE BUSINESSES HAS PICKED UP SOMEWHAT. BANKS LOAN BANKERS APPEAR MORE ACTIVE IN SEEKING OUT LENDING OPPORTUNITIES. BANK REGULATORS ARE MORE SENSITIVE ABOUT REGULATORY IMPEDIMENTS TO LENDING. ALL IN ALL, THE STAGE APPEARS SET FOR AN INCREASE IN BANK LENDING DURING 1993. SINCE EARLY 1989, THE FEDERAL RESERVE HAS BEEN USING ITS TRADITIONAL MONETARY POLICY TOOLS TO HELP FOSTER ECONOMIC PERFORMANCE MORE IN KEEPING WITH OUR NATION'S POTENTIAL. THE FED CONTINUED TO EASE MONETARY POLICY IN 1992. INTEREST RATES FELL TO THEIR LOWEST LEVELS IN 30 YEARS. AS A RESULT, SHORT-TERM BY YEAR-END, STUBBORNLY HIGH LONG-TERM RATES BEGAN TO DECLINE AS WELL. INFLATIONARY PRESSURES HAVE EASED IN RECENT YEARS, AND THESE GAINS ARE CRUCIAL FOR SUSTAINABLE GROWTH AND PROSPERITY. LOWER INFLATION AND THE PROSPECT OF SMALLER FEDERAL BUDGET DEFICITS SHOULD HELP KEEP LONG-TERM INTEREST RATES LOW AND THUS RAISE THE PATH OF EMPLOYMENT AND ECONOMIC GROWTH IN 1 993 AND BEYOND. Edward G. Boehne President The Federal Reserve Bank of Philadelphia 3 Letter from the First Vice President hroughout the T Third District, banks and other companies are rigorously RESTRUCTURING THEIR ORGANIZATIONS TO RAISE PRODUCTIVITY AND IMPROVE THE QUALITY OF THEIR SERVICES. WE AT THE PHILADELPHIA FED ARE COMMITTED TO SUPPORTING THE CHANGES OF A NEW, MORE VIGILANT BUSINESS ENVIRONMENT AND TO HELPING BANKS IMPROVE THEIR SERVICES BY UPGRADING OUR OWN. During 1992, we made significant progress in many areas of our operations. We WORKED TO IMPROVE OUR SERVICES AND PRODUCTS TO FINANCIAL INSTITUTIONS IN THE DISTRICT. WE ALSO STEPPED UP OUR QUALITY PROGRAMS AND IMPROVED OUR CONTROL SYSTEMS ON A BANK WIDE BASIS. THE CHALLENGES WERE MANY, BUT OUR EFFORTS HAVE BEEN REWARDED. 4 The Federal Reserve Bank of Philadelphia Already our the largest single-site check processor in the Bank experienced a major increase in volume in Federal Reserve System, 1992. The total number of items PROCESSED WAS UP BY ALMOST 10 PERCENT OVER 1991. OUR FOCUS ON QUALITY AND CONTROL EFFORTS HELPED DISTINGUISH US IN OTHER AREAS OF THE BANK, TOO. OUR DATA SECURITY CONTROLS, FOR INSTANCE, PRESENTLY RANK AMONG THE BEST IN THE FEDERAL RESERVE SYSTEM. THE CHALLENGES TO OUR SUPERVISORY ACTIVITIES OVER THE PAST YEAR WERE INDEED NUMEROUS. OUR SUPERVISION AND REGULATION DEPARTMENT HAS UNDERGONE MANY CHANGES SINCE THE PASSAGE OF THE FDIC IMPROVEMENT ACT. WE ADDED STAFF AND REORGANIZED THE DEPARTMENT IN ORDER TO BETTER COORDINATE AND IMPROVE SUPERVISORY ACTIVITIES. All in all, we accomplished the goals we set for ourselves BECAUSE people at ALL LEVELS OF OUR OPERATIONS WERE ENCOURAGED TO GET INVOLVED. THE TEAM EFFORT OF OUR EMPLOYEES WAS THE KEY TO A SUCCESSFUL YEAR. IN THE SPIRIT OF A STRENGTHENED ENVIRONMENT, WE WILL CONTINUE IMPROVING The SERVICES WE PROVIDE YOU, JUST AS YOU CONTINUE improving services TO YOUR CUSTOMERS. WILLIAM H. STONE, JR. first Vice president The Federal Reserve Bank of Philadelphia 5 ichard W. Lang (right). Senior Vice President and Director of Research, and Theodore M. Crone, Assistant Vice President and Economist, discuss recently com piled Third District data. News and Views: The Third District Economy p ■ ■ IVEN ITS LOCATION, IT'S TEMPTING TO THINK OF THE THIRD FEDERAL RESERVE Vb District as a slice of the NORTHEAST RUST BELT. Eastern "megalopolis" or a section in the BUT THE DISTRICT SERVED BY THE FEDERAL RESERVE BANK OF PHILADELPHIA IS AN ECONOMICALLY DIVERSE ONE. PHILADELPHIA ITSELF IS THE FOURTH MOST POPULOUS METROPOLITAN AREA IN THE NATION-HOME TO SOME 5 MILLION PEOPLE. BUT NOT FAR FROM THE CITY-IN PARTS OF SOUTH JERSEY, SOUTHERN DELAWARE AND SOUTH-CENTRAL PENNSYLVANIA-FARMING IS STILL A MAJOR INDUSTRY. IN A SENSE, THE THIRD DISTRICT IS A MICROCOSM OF THE NATION. THERE'S A LITTLE BIT OF EVERYTHING HERE. THE PROPORTIONS OF OUR WORK FORCE ENGAGED IN AGRICULTURE, MANU FACTURING AND THE SERVICE INDUSTRIES CLOSELY MATCH THOSE OF THE COUNTRY AS A WHOLE. BUT THE DISTRICT HAS ITS SPECIALTIES AS WELL-SUCH AS HEALTH CARE. WE HAVE A LARGE NUMBER OF MEDICAL CENTERS AND A CONCENTRATION OF PHARMACEUTICAL RESEARCH AND PRODUCTION COMPANIES. National economic shifts HETEROGENEOUS AS OURS. OF THE 1980S. and trends have an irregular impact on a region as NEW JERSEY, FOR EXAMPLE, PROSPERED DURING THE LONG EXPANSION A BUILDING BOOM, COUPLED WITH A SURGING FINANCIAL SERVICES INDUSTRY AND CASINO GAMBLING IN ATLANTIC CITY, BROUGHT TREMENDOUS GROWTH TO THE STATE. BUT WHEN THE BUILDING STOPPED, THE STATE SLIPPED BADLY. Meanwhile in Pennsylvania, the expansion of the 1980s never really produced A BOOM AND THE ENSUING RECESSION NEVER PRODUCED A BUST. Pennsylvania was spared a recession. As is THIS IS NOT TO SAY typical of recessions, the most recent RECESSION HIT MANUFACTURING EMPLOYMENT HARD AND MANUFACTURING IS IMPORTANT IN PENNSYLVANIA. The Federal Reserve Bank of Philadelphia 7 './v. - » J harles C. Bylone President, Vineland Cooperative Produce Auction,Vineland, New Jersey, shows a lush bed of romaine lettuce Mr.Bylone is chairman of the Philadelphia Fed's Small Business/Agriculture Advisory Council oreover, much of M Pennsylvania comprises small towns where one firm REPRESENTS THE MAJOR SOURCE OF EMPLOYMENT. AS INDIVIDUAL FIRMS FALTER, INDIVIDUAL COMMUNITIES FEEL THE IMPACT. Delaware, one of the smallest states in the nation, took its economic destiny INTO ITS OWN HANDS-AND HAS REAPED THE REWARDS. WITH THE PASSAGE OF ITS FINANCIAL CENTER Development Act in 1981, Delaware became the location of choice for credit-card and OTHER OPERATIONS FOR A NUMBER OF THE NATION'S LARGEST BANKS. OVER THE NEXT 10 YEARS, FINANCIAL-SECTOR EMPLOYMENT DOUBLED AND OVERALL JOB GROWTH IN THE STATE WAS ONE AND A HALF TIMES THE NATIONAL AVERAGE. Though employment declined the District states to regain On in Delaware during its pre-recession employment level. the whole, the most recent recession hit the REST OF THE NATION. the recession, it is the first of Third District harder than the AT THE RECESSION'S WORST, WHICH FOR THIS REGION CAME IN THE THIRD QUARTER OF 1992, DISTRICT EMPLOYMENT HAD DECLINED 4 PERCENT. MORE THAN THREE-QUAR TERS OF JOBS LOST WERE IN MANUFACTURING AND CONSTRUCTION, BUT AGAIN MIRRORING THE NATION, AN UNUSUALLY HIGH PERCENTAGE WERE IN THE SERVICE INDUSTRIES. AS 1992 DREW TO A CLOSE, WE WERE ONLY STARTING TO SEE THE FIRST SIGNS OF A GENUINE ECONOMIC RECOVERY. quarter. Retailers dents to our EMPLOYMENT EDGED UP IN THE DISTRICT DURING THE FOURTH reported healthy holiday sales, and a growing number of respon Business Outlook Survey reported stepped-up production. As THE RECESSION FADES AND THE RECOVERY GETS UNDER WAY, THE LONG-RUN TRENDS AT WORK IN OUR DISTRICT WILL REEMERGE. AGAIN THE TRENDS ARE NATIONAL, BUT THE SPECIAL CHARACTERISTICS OF THE DISTRICT SHAPE THEIR IMPACT HERE. The Federal Reserve Bank of Philadelphia 9 L ozelle DeLuz, President and Owner, Deluz Management, at one of the MacDonald's she operates in downtown Wilmington, Delaware. Mrs.DeLuz is deputy chairperson of the Philadelphia. Fed's Small Business/Agriculture Advisory Council. r I IV ANUFACTURED GOODS REPRESENT A STEADY SHARE OF THE NATION'S OUTPUT, BUT MANUFACTURING JOBS REPRESENT A DECLINING SHARE OF THE NATION'S EMPLOYMENT, AS PRODUCTIVITY IN THAT SECTOR CONTINUES TO RISE RAPIDLY. Our own District Index is no exception to that trend. Our Mid-Atlantic Manufacturing shows output growing at an annual rate of 1 1/4 percent during the 1980s, while MANUFACTURING EMPLOYMENT WITHIN THE DISTRICT FELL AT NEARLY A 1 PERCENT RATE. The demographics of our district accentuate the impact of two other national EMPLOYMENT TRENDS: THE DECLINE OF CONSTRUCTION AND THE RISE OF SERVICES. Across the country, the aging of the baby boomers is slowing the rate of house hold FORMATION. OVER TIME THIS IS DIMINISHING THE DEMAND FOR NEW HOMES. MEANWHILE, PEOPLE ARE LIVING LONGER AND THIS AGING POPULATION IS DEMANDING MORE HEALTH CARE SERVICES. HERE IN THE THIRD DISTRICT, GROWTH IN THE WORKING-AGE POPULATION LAGS THE REST OF THE NATION AND THE AVERAGE AGE OF THIRD DISTRICT RESIDENTS EXCEEDS THE NATIONAL AVERAGE. Perhaps nowhere are national trends having more of an impact than on the District's banking industry. Of course, the impact of the FDIC Improvement Act of 1991 HAS YET TO BE FELT COMPLETELY. THE LAW HAS ALREADY TIGHTENED REGULATORY STANDARDS AND FOSTERED MORE CAUTIOUS LENDING PRACTICES, BUT OTHER PROVISIONS CONCERNING BANK MANAGE MENT PRACTICES AND RESPONSIBILITIES HAVE YET TO BE IMPLEMENTED. The Federal Reserve Bank of Philadelphia 11 A fiN Inside View... By each of the maps below, we've indicated the number of small, medium and large com mercial BANKS (BY ASSETS) IN THE PORTIONS OF THE THREE STATES IN THE THIRD FEDERAL Reserve District. Our District includes the eastern two-thirds of Pennsylvania, Southern New Jersey and all of Delaware. PENNSYLVANIA Small banks Medium banks Large banks DELAWARE • Small • • Large 12 banks------- total assets under $100 million MEDIUM BANKS------- BETWEEN $100 MILLION AND $1 BILLION banks------- greater than $1 billion The Federal Reserve Sank of Philadelphia A Look At Annual Growth in Payroll Employment... 3 2 1 0 -1 -2 -3 ■ Pennsylvania j New Jersey Delaware The Federal Reserve Bank of Philadelphia 13 resident Boehne P regularly meets with business and community leaders throughout the Third District. After a recent meeting in Bloomsburg, Pennsylvania, President Boehne visited local businessman Mike Kanterman, Executive Vice President, Magee Industrial Enterprises. Inc. The company manu factures carpeting for automobiles. D UT FOR OVER A DECADE, BANKING IN THE DISTRICT HAS BEEN EVOLVING IN RESPONSE TO CHANGING REGULATION, FINANCIAL INNOVATIONS AND TECHNOLOGI CAL advances. Delaware has established itself as a harbor for several of the largest INSTITUTIONS OPERATING ON A NATIONAL SCALE. MEANWHILE IN NEW JERSEY, THE LARGER INSTITU TIONS ARE CAPTURING A GREATER SHARE OF THE BANKING BUSINESS THROUGH CONSOLIDATION. Pennsylvania, holding companies IN had been combining community banks into networks to TAKE ADVANTAGE OF SCALE ECONOMIES. NOW CONSOLIDATION SEEMS TO BE COMING TO Pennsylvania banking as well. Throughout the year, we heard the frustrations of people dealing with a LINGERING RECESSION-AND RECESSION PSYCHOLOGY. THE HARDWARE STORE OWNER WHO COM PLAINS HIS CUSTOMERS “WILL DRIVE FIVE MILES TO SAVE 25 CENTS.” “Every one of my customers says the same thing: ‘It's bad out OR THE BANKER WHO SAYS, there, but I've been lucky’.” a But they express even greater concerns about THE LONG-RUN ISSUES: the respon siveness OF GOVERNMENT; THE QUALITY OF OUR LABOR FORCE; AND THE CHALLENGE OF AN INCREASINGLY INTERNATIONAL ECONOMY. Whatever the challenges, third district businesses respond with practicality AND PURPOSE. ASKED HOW HE SURVIVES DIFFICULT TIMES, ONE FARMER SAID SIMPLY, “WE DIVERSI FY OUR PRODUCTS AND WE MAINTAIN OUR QUALITY.” A DISTRICT BUSINESSWOMAN PUT HER MISSION THIS WAY: “WE SERVE OUR CUSTOMERS AND WE SERVE OUR COMMUNITY.” The Federal Reserve Bank of Philadelphia 15 eputy Chairperson of the Board Jane G. Pepper, President of the Pennsylvania Horticultural Society, Philadelphia, Pennsylvania, and Chairman of the Board Peter A. Benoliel, Chairman of Quaker Chemical Corp., Conshohocken, Pennsylvania Board of Directors n 1992, James A. Hagen was elected a Class B director, replacing I Nicholas Riso. Chairman H. Bernard Lynch Peter A. Benoliel President and Chief Executive Officer Chairman The First National Bank of Wyoming Quaker Chemical Corp. Wyoming, DE Conshohocken, PA Samuel A. McCullough Deputy Chairperson Chairman and Chief Executive Officer Jane G. Pepper Meridian Bancorp, Inc. President Reading, PA The Pennsylvania Horticultural Society Philadelphia, PA James M. Mead President and Chief Executive Officer James A. Hagen Capital Blue Cross President and Chief Executive Officer Harrisburg, PA Consolidated Rail Corp. (CONRA1L) Philadelphia, PA Gary F. Simmerman President and Chief Executive Officer David W. Huggins United Jersey Bank/South, N.A. President and Chief Executive Officer Cherry Hill, NJ RMS Technologies, Inc. Marlton, NJ Donald J. Kennedy Business Manager International Brotherhood of Electrical Workers Local Union #269 Trenton, NJ The Federal Reserve Bank of Philadelphia 17 Officers N 1992, THE FOLLOWING CHANGES WERE MADE IN OUR SUPERVISION AND REGULATION I DEPARTMENT: STEPHEN M. HOFFMAN WAS NAMED VICE PRESIDENT RESPONSIBLE FOR INTERNATIONAL EXAMINATIONS, AUTOMATION AND SURVEILLANCE AND SUPPORT, AND MICHAEL E. COLLINS BECAME VICE PRESIDENT IN CHARGE OF EXAMINATION PROCESSING AND QUALITY CONTROL, Enforcement Credit Discount. and John J. Diebel was promoted President of International Examinations-, John V. to Assistant Vice Heelan was appointed International Examinations Officer and Joan M. Immel became Examinations Review Officer. Thomas L. Tweedale was Eileen p. named Assistant Vice President of the Surveillance and Support Unit, and Adezio was named Assistant Vice President of the Enforcement Section. In our Check Operations Department, D. Blake Prichard was appointed Senior VICE PRESIDENT; KEVIN J. MCCABE WAS NAMED ASSISTANT VICE PRESIDENT AND HENRY T. KERN WAS PROMOTED TO ASSISTANT VICE PRESIDENT IN CHARGE OF CHECK ADJUSTMENTS AND RETURN Items. In other official changes, Jeanette M. Paladino of the Legal Department was PROMOTED TO ASSISTANT COUNSEL. In changes of official assignment. Senior Vice President Peter M. DiPlacido ASSUMED RESPONSIBILITY FOR THE GENERAL ADMINISTRATIVE SERVICES DEPARTMENT AND JOHN Shafer was named the Treasury Direct Operations Officer, Bank's Controller. Annie R. Assistant Vice President Ward was named Camille Ochman assumed responsibility for the Savings Bond Division in the Fiscal M. Department. 18 Vice President of Accounting and B. The Federal Reserve Bank of Philadelphia and Edward G. Boehne President William H. Stone, Jr. First Vice President Donald F. Doros Executive Vice President Edward J. Coia Senior Vice President Thomas K. Desch Senior Vice President and Lending Officer Donald J. McAneny Vice President and General Auditor Louis N. Sanfelice Vice President John B. Shaffer Vice President Milissa M. Tadeo Vice President Mary M. Labaree Assistant General Auditor Thomas P. Lambinus Assistant Vice President Kevin J. McCabe Assistant Vice President Joseph L. McCann Administrative Services Officer Herbert E. Taylor Vice President and Secretary Alice J. Menzano Disaster-Recovery Planning and Quality Assurance Officer Vish P. Viswanathan Deputy Check Product Manager Loretta J. Mester Research Officer and Economist Richard W. Lang Senior Vice President and Director of Research Eileen P. Adezio Assistant Vice President Edward Morrison Systems Development Officer Ronald B. Lankford Senior Vice President John G. Bell Research Officer Camille M. Ochman Assistant Vice President D. Blake Prichard Senior Vice President Gerard A. Callanan Assistant Vice President and Planning Officer Jeanette M. Paladino Assistant Counsel Peter M. DiPlacido Senior Vice President Robert J. Bucco Vice President J. Warren Bowman, Jr. Vice President Michael E. Collins Vice President Shirley L. Coker Assistant Counsel Theodore M. Crone Assistant Vice President and Economist Robert A. Dobie Vice President Dean Croushore Research Officer and Economist Patrick L. Donahue Vice President John J. Deibel Assistant Vice President William Evans, Jr. Vice President Robert N. Downes, Jr. Assistant Vice President Joanna H. Frodin Vice President and Check Product Manager Frank E. Eisel, Jr. Assistant Vice President Patrick M. Regan Assistant Vice President Edward G. Rutizer Assistant Vice President Sherrill Shaffer Assistant Vice President and Economist Richard A. Sheaffer Assistant Vice President Ronald R. Sheldon Assistant Vice President Marie Tkaczyk Assistant Vice President Sharon N. Tomlinson Assistant Vice President Stephen M. Hoffman Vice President John V. Heelan International Examinations Officer Thomas L. Tweedale Assistant Vice President Jerry Katz Vice President Eugene E. Hendrzak Assistant Vice President Annie R. Ward Operations Officer Edward M. Mahon Vice President and General Counsel Joan M. Immel Examination Review Officer Elizabeth S. Webb Assistant Counsel A run Jain Planning Officer Bernard M. Wennemer Assistant Vice President Henry T. Kern Assistant Vice President Anthony J. White Financial Services Officer Alan L. Kiel Assistant Vice President Richard A. Valente Audit Officer Frederick M. Manning Vice President and Community Affairs Officer Stephen A. Meyer Vice President and Associate Director of Research The Federal Reserve Bank of Philadelphia 19 Advisory Councils he bank's four advisory councils include representatives from many of the T Third District’s leading industries. The meetings between members of the COUNCILS AND THE BANK'S SENIOR OFFICERS PROVIDE A VENUE FOR THE EXCHANGE OF IMPORTANT INFORMATION ABOUT LOCAL BUSINESS AND THE ECONOMY. THE 1992 MEMBERS OF THE ADVISORY COUNCILS ARE LISTED BELOW. Small Business/Agriculture Advisory Council Credit Union Advisory Council Chairman Charles C. Bylone Vineland Cooperative Produce Auction Vineland, NJ Chairman Robert H. Edmondson Atlantic Employees FCU Media, PA Deputy Chairperson Lozelle DeLuz DeLuz Management Wilmington, DE Deputy Chairman Anthony LaRosa Police and Fire FCU Philadelphia, PA Raymond L. Blew, Jr. Centerton Nurseries Bridgeton, NJ Elisa P. Alexeeve Trenton Auto Workers FCU Trenton, NJ Donald Clark Clark Seed Company Kenton, DE David Baker York Educational FCU York, PA John L. Coates Tri-County Hardware Berwick, PA Martin J. Banecker Campbell Employees FCU Camden, NJ C. William Haines Larchmont Farms Mount Laurel, NJ Susan Bicking Mobil 1167 FCU Paulsboro, NJ Allan Hawkins Hawkins Cleaning Service Philadelphia, PA Linda Blattenberger Capital Health Systems CU Harrisburg, PA Eleanor Marquisee Arden Films & Video Wilmington, DE Linda Fischer Barrington FCU Barrington, NJ William J. Oyler Oyler's Farm Biglerville, PA Charles Patitucci Patitucci Agency Bridgeton, NJ John C. Simms, VMD Burnt Mill Veterinary Center Shippensburg, PA Larry R. Weaver Weaverland Valley Farms New Holland, PA 20 The Federal Reserve Bank of Philadelphia Christine M. Kaczmarczvk DEXSTA FCU Wilmington, DE Shirlee Nicolino Merck Sharp & Dohme, FCU West Point, PA JoAnne Simpson Chryco Newark FCU Newark, DE Thomas Swierzv Smith Kline Employees FCU Philadelphia, PA Community Bank Advisory Council Thrift Institution Advisory Council Chairperson Jane C. Diebert Schuylkill Haven Trust Co. Schuylkill Haven, PA Chairman Jack W. Shader, Sr. Harris Savings Bank Harrisburg, PA Deputy Chairman Ronald C. Brown The Yardville National Bank Yardville, NJ Deputy Chairman Edward J. Molnar Harleysville Savings Bank Harleysville, PA J. Gerald Bazewicz The First National Bank of Berwick Berwick, PA Ronald IV. Bevan Delaware Savings Bank, FSB Wilmington, DE Frederick W. Bisbee First National Trust Bank Sunbury, PA Gregory DiPaolo South Jersey Savings & Loan Association Turnersville, NJ Adolph F. Calovi Sun National Bank Medford, NJ Carl F. Gregory Third Federal Savings & Loan Philadelphia, PA Joseph H. Doble Farmers Bank of Mullica Hill Mullica Hill, NJ John D. Hollenbach First Savings Bank Perkasie, PA Paul H. Mylander Delaware National Bank Georgetown, DE Herbert Hornsby Cape Savings Bank, SLA Cape May Court House, NJ John H. O'Neill Bank of Delaware Valley Fairless Hills, PA Bruce R. Hostler Reliance Savings Association Altoona, PA Melvin Pankuch Blue Ball National Bank Blue Ball, PA William H. Kiick First Federal Savings Bank Hanover, PA Harold L. Slatcher County Bank Rehoboth Beach, DE Ellen Ann Roberts First Financial Savings Bank PASA Downingtown, PA Harry W. Van Sciver Burlington County Bank Burlington, NJ Patricia A. Saunders Morton Savings & Loan Association Morton, PA Ray L. Wolfe Fanners Trust Co. Carlisle, PA Joseph J. Tyron Hatboro Federal Savings Hatboro, PA The Federal Reserve Bank of Philadelphia 21 STATEMENT OF CONDITION 12/31/92 12/31/91 $347,000,000 303,000,000 23,521,894 $318,000,000 319,000,000 39,844,938 591,880,000 164,746,239 8,979,356,206 159,714,271 7,041,384,541, ASSETS Gold certificate account Special drawing rights certificates Other cash - coin Loans and securities: Discounts and advances Federal agency obligations United States government securities Total loans and securities Other assets: Cash items in process of collection Bank premises-net Operating equipment-net Foreign currencies All other Interdistrict settlement account 45,290,000 $9,735,982,445 $7,246,388,812 538,169,101 45,093,745 19,248,779 851,937,342 179,412,854 592,229,058 44,271,308 16,706,557 1,312,235,000 128,912,896 2,183,258,569 3,171,568,486^ Total assets $14,226,624,729 $13,189,157,055, Federal reserve notes Depository institutions' reserves Foreign All other $11,341,210,181 2,207,168,223 5,504,400 8,052,813* $10,872,446,355 1,469,840,995 7,125,000 73,648,540; $2,220,725,436 $1,550,614,535 368,035,076 489,958,715 LIABILITIES AND CAPITAL ACCOUNTS Note liabilities: Deposits: Total deposits Other liabilities: Deferred availability cash items All other $12,978,956,055 Capital paid in 117,317,900 105,100.500 Surplus 117,317,900 105,100,500, $14,226,624,729 $13,189,157,05^ Total liabilities and capital * Includes payable due to Treasury. 22 65,936,450, $13,991,988,929 Total liabilities Capital accounts: 62,018,236 The Federal Reserve Bank of Philadelphia EARNINGS AND EXPENSES 12/31/92 12/31/91 From U.S. government securities From discounts, advances and miscellaneous sources From services to depository institutions $504,283,274 $522,542,526 85,651,898 41,061,467 119,510,419 37,861,697 Total current earnings $630,996,639 $679,914,642 70,808,127 19,217,932 65,253,442 13,986,254 $90,026,059 $79,239,696 $540,970,580 $600,674,946 3,494,576 0 9,953 3,632,617 15,218,772 3,603 Total additions $3,504,529 $18,854,992 Loss on foreign currency transactions Miscellaneous non/operating expenses Assessment by the Board of Governors: Board expenditures Federal Reserve currency 42,716,899 1,468,155* Currrent Earnings: Net expenses: Operating expenses (after deducting reimbursable expenses) Cost of earnings credits Total net expenses Current net earnings Additions to current net earnings: Deductions from current net earnings: Gain on sales of government securities Gain on foreign currency transactions Miscellaneous non/operating income 5,135,700 10,548,662 4,818,600 6.912,056 $59,869,416 $23,684,571 ($56,364,887) ($4,829,579) Net earnings (before payment to U.S. Treasury) $484,605,693 $595,845,367 Dividends paid Paid to U.S. Treasury (interest on FR notes) Retained to equate surplus to capital $6,856,095 465,532,198 12,217,400 $6,134,888 599,783,979 (10,073,500) $484,605,693 $595,845,367 Total deductions Net additions Distribution of earnings: 0 11.953,915 = Net earnings (deductions) nonreimbursed Treasury services. The Federal Reserve Bank of Philadelphia 23 OPERATING STATISTICS 1992 1992 1991 1991 Volume Dollar Value Volume Dollar Value~ 5.3 million transfers $16.9 trillion 5.0 million transfers $16.7 trillion 37.3 million items $52.2 billion 35.0 million $52.2 billion 111.2 million $313.2 billion SERVICES TO DEPOSITORY INSTITUTIONS Wire transfers of funds Government ACH Commercial items items Check processing U.S. Government 22.6 million Cash operations Currency received and counted Coin received and counted Loans to depository institutions $287.1 billion items $27.9 billion checks All others 90.8 million 23.9 million $28.3 billion checks $1.2 trillion SI 1.5 billion 1.2 billion checks $1.4 trillion 1.0 billion $13.1 billion 1.0 billion notes $174 million 150 thousand bags $103 milW 1247 $2.7 billion 1.046 $2.5 bilW 987.9 thousand $14.3 trillion 956.6 thousand transfers $914 million 4.4 million checks notes 126 thousand 1.1 billion bags SERVICES TO U.S. TREASURY Electronic book entry transfers Savings bonds issued transfers 5.2 million bonds Food stamps redeemed 162.4 million coupons 24 The Federal Reserve Bank of Philadelphia $13.2 trilH^ $444 mill'0* bonds $813 million 130.9 million coupons $655
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