Full text of Federal Reserve Bulletin : August 1994
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VOLUME 8 0 •
NUMBER 8 •
AUGUST 1994
BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM, WASHINGTON, D . C .
PUBLICATIONS COMMITTEE
Joseph R. Coyne, Chairman • S. David Frost • Griffith L. Garwood • Donald L. Kohn
• J. Virgil Mattingly, Jr. • Michael J. Prell • Richard Spillenkothen • Edwin M. Truman
The Federal Reserve Bulletin is issued monthly under the direction of the staff publications committee. This committee is responsible for opinions
expressed except in official statements and signed articles. It is assisted by the Economic Editing Section headed by S. Ellen Dykes, the Graphics
Center under the direction of Peter G. Thomas, and Publications Services supervised by Linda C. Kyles.
Table of Contents
681 MONETARY
CONGRESS
POLICY REPORT TO THE
The favorable performance of the U.S. economy continued in the first half of 1994. Economic activity advanced at a brisk pace, building on the substantial gains in late 1993, and
broad measures of inflation moved still lower.
Unemployment declined, and industrial capacity utilization rose, largely eliminating the
slack in resource use. In this context, monetary policy has been directed this year at heading off a destabilizing buildup of inflationary
pressures that could jeopardize the continuation of the economic expansion. To do so, the
Federal Reserve has had to move away from
its highly accommodative policy stance of
recent years, and it has firmed money market
conditions in four steps this year.
702 INDUSTRIAL PRODUCTION AND
CAPACITY UTILIZATION FOR JUNE
1994
Industrial production rose 0.5 percent in June,
to 116.8 percent of its 1987 average. The
utilization of total industrial capacity rose
0.3 percentage point, to 83.9 percent.
705 STATEMENTS
TO THE
CONGRESS
Lawrence B. Lindsey, member, Board of
Governors of the Federal Reserve System,
addresses issues related to consumer credit
and says that credit to households appears to
be quite readily available and that many
households have completed substantial adjustments to alleviate debt-servicing strains and
are showing that they are again willing to
borrow to finance spending, before the Subcommittee on Consumer Credit and Insurance
of the House Committee on Banking, Finance
and Urban Affairs, June 9, 1994.
709 John R LaWare, member, Board of Governors, discusses title II, Small Business Capital Formation, of the Community Development, Credit Enhancement, and Regulatory
Improvement Act of 1994 (H.R.3474) and
says that the Board supports the objective of
this legislation of increasing the availability of
credit to small businesses by facilitating the
securitization of small business loans and is
committed to continuing to work with the
committee, the other banking agencies, and
the Administration in developing an approach
that will remove any unnecessary impediments to securitization, while at the same time
protecting the safety and soundness of the
banking system and minimizing regulatory
burden, before the Subcommittee on Telecommunications and Finance of the House
Committee on Energy and Commerce,
June 14, 1994.
714 Alan Greenspan, Chairman, Board of Governors, discusses recent monetary policy actions
and issues related to inflation and says that
despite considerable policy challenges and the
always-present future uncertainties, the outlook for the U.S. economy is as bright as it has
been in decades and that the intent of monetary policy in recent years has been to foster
this kind of healthy economic performance,
before the House Committee on the Budget,
June 22, 1994.
719 Susan M. Phillips, member, Board of Governors, discusses the trends in retail fees and the
availability of retail services at depository
institutions as revealed by data obtained from
annual surveys sponsored by the Federal
Reserve System and says that results of the
most recent surveys indicated that the availability of the majority of retail services examined did not change appreciably between 1992
and 1993 and that a general trend was also
observable in the direction of increased fees,
corresponding to an increase in deposit insurance premiums, before the Subcommittee on
Consumer Credit and Insurance of the House
Committee on Banking, Finance and Urban
Affairs, June 22, 1994.
724 ANNOUNCEMENTS
Appointments of Alan S. Blinder as a member
of the Board of Governors and as Vice
Chairman.
769 MEMBERSHIP OF THE BOARD OF
GOVERNORS OF THE FEDERAL
RESERVE SYSTEM,
1913-94
List of appointive and ex officio members.
A1 FINANCIAL AND BUSINESS
STATISTICS
These tables reflect data available as of
June 28, 1994.
A3 GUIDE TO TABULAR
PRESENTATION
Nominations sought for appointments to the
Consumer Advisory Council.
A4 Domestic Financial Statistics
A45 Domestic Nonfinancial Statistics
A53 International Statistics
Production of a videotape for use in training
staff of financial institutions, trade associations, and others in fair lending practices.
A67 GUIDE TO STATISTICAL RELEASES AND
SPECIAL TABLES
Final amendments to the real estate appraisal
requirements.
A76 INDEX TO STATISTICAL
Proposed changes to Regulation C; a proposed
amendment to Regulation H; proposed
amendments to Regulation T.
A78 BOARD OF GOVERNORS AND
Publication of a supplement to the Bank Holding Company Supervision Manual.
Changes in Board staff.
729 LEGAL
DEVELOPMENTS
Various bank holding company, bank service
corporation, and bank merger orders; and
pending cases.
TABLES
STAFF
A80 FEDERAL OPEN MARKET
COMMITTEE
AND STAFF; ADVISORY
COUNCILS
A82 FEDERAL RESERVE
PUBLICATIONS
BOARD
A84 MAPS OF THE FEDERAL
SYSTEM
RESERVE
A86 FEDERAL RESERVE BANKS,
AND OFFICES
BRANCHES,
Monetary Policy Report to the Congress
Report submitted to the Congress on July 20, 1994, ing state-of-the-art equipment; rising utilization
rates have spurred interest in expansion of capacity
pursuant to the Full Employment and Balanced
as well. Consumer outlays have trended higher this
Growth Act of 19781
year, buoyed by the considerable gains in income
and an increased willingness to borrow or use
savings; lately, though, spending growth appears to
MONETARY POLICY AND THE ECONOMIC
have moderated somewhat. The rise in long-term
OUTLOOK FOR 1994 AND 1995
interest rates that began last fall has damped the
growth of housing activity this year, but the effect
The favorable performance of the U.S. economy
has been relatively mild, in part because homes
continued in the first half of 1994. Economic activremain quite affordable by the standards of the past
ity advanced at a brisk pace, building on the
two decades. In the labor market, the employment
substantial gains in late 1993, and broad measures
gains during the first half of this year were substanof inflation moved still lower. Unemployment
tially more rapid than those in 1993, and the unemdeclined and industrial capacity utilization rose,
ployment rate has continued to move lower.
substantially reducing the remaining slack in
resource use.
Inflation generally was moderate during the first
half of 1994. Retail food and energy prices changed
In this context, monetary policy has been dilittle, on balance, over the period, holding the rise
rected this year at heading off a buildup of inflain the consumer price index (CPI) to 2Vi percent at
tionary pressures that could jeopardize the continuan annual rate. At the same time, the prices of a
ation of the economic expansion. To do so, the
wide range of materials used in manufacturing and
Federal Reserve has had to move away from its
construction have been boosted considerably by
highly accommodative policy stance of recent
strong demand and the resulting higher rates of
years. That stance had been adopted to counteract
resource utilization. Looking ahead, retail energy
unusual restraint on domestic spending associated
in large part with the efforts of both borrowers and prices likely will rise over the summer, pushed up
by the rebound in crude oil prices in recent months;
lenders to strengthen theirfinancialcondition. Data
in addition, the decline in the dollar since the
available in late 1993 and early 1994 suggested
beginning of the year, if not reversed, probably will
that the restraint on spending had dissipated and
exert some upward pressure on prices.
that the economic expansion had become strong
and self-sustaining. Against this background, the
The Federal Reserve's policy actions this year
Federal Reserve has firmed money market condihave raised the federal funds rate to around A1 A pertions in four steps this year.
cent, from 3 percent, and have boosted the discount
rate to 3V2 percent, also from 3 percent. Other
Despite disruptions caused by severe winter
market interest rates have risen 1 lA to l3A percentstorms, real gross domestic product (GDP) rose at
age points since the beginning of the year. Increases
an annual rate of 3V2 percent in the first quarter,
in intermediate- and long-term rates have been
and available indicators point to another sizable
unusually large relative to the adjustment of shortgain in the second quarter. Business fixed investterm rates, reflecting stronger-than-anticipated
ment has continued to grow rapidly this year, as
firms have sought to improve efficiency by install- economic growth and market expectations of
greater inflationary pressures as well as actual and
expected tightening actions by the Federal Reserve
1. The charts for the report are available on requestfromPubli- to contain those pressures. On occasion, the declincations Services, Board of Governors of the Federal Reserve Sysing value of the dollar also appeared to contribute
tem, Washington, DC 20551;
682
Federal Reserve Bulletin • August 1994
to higher yields. Markets have been volatile at
times this year as investors have adjusted to a
changing economic and policy outlook. The uncertain conditions encouraged investors to try to
reduce their risk exposure, and the associated
attempts to make large shifts in portfolios over
short periods seemed to add to the upward pressure
on long-term rates at times.
Despite the rise in U.S. interest rates, the dollar
has declined considerably this year, with its tradeweighted foreign exchange value against the Group
of Ten (G-10) countries falling about 8 percent.
Rising long-term interest rates abroad, associated
with brighter prospects for economic growth,
tended to offset the effect on the dollar of higher
U.S. rates. Moreover, other factors, including
diminished hopes for a prompt resolution of trade
tensions with Japan and market concerns about
future inflation in the United States, fostered downward pressure on the dollar. This pressure was
especially intense in late April and early May and
again in the second half of June and first half of
July. The U.S. Treasury and the Federal Reserve
made substantial dollar purchases on three occasions during these periods to deal with volatile
trading conditions and movements in the dollar
judged to be inconsistent with economic fundamentals. Other governments shared the concern of U.S.
officials, and the more recent operations were coordinated with the monetary authorities of a large
number of other countries, including the other
members of the Group of Seven (G-7).
The strength of spending and a renewed willingness to use and extend credit contributed to a
pickup in borrowing by households and businesses
in the second half of last year, and this trend
extended into the first half of 1994. However, the
composition of borrowing has been affected by
financial market conditions. Rising and more volatile long-term interest rates have encouraged businesses to rely more heavily on sources of shorterterm financing, such as finance companies and
banks, and have prompted households to shift to
adjustable rate mortgages. Banks, which had been
hampered by balance sheet problems of their own
in recent years, sought business and household
loans more aggressively by continuing to ease
credit standards and the nonprice terms of lending.
Total commercial bank credit has increased moderately this year, and thrift institution credit, which
contracted sharply between 1989 and 1993,
appears to have expanded a bit. In contrast to the
strength of private borrowing, the growth of federal
government debt has slowed this year, reflecting
the subdued growth of expenditures and sharply
higher tax receipts associated with fiscal policy
actions and the robust economy. As a result, the
total debt of the domestic nonfinancial sectors
expanded at about a 5V4 percent annual rate from
the fourth quarter of 1993 through May, close to its
pace over the second half of last year and well
within its monitoring range of 4 to 8 percent.
Growth of the broad money aggregates has not
kept pace with that of nominal GDP again this year.
M2 increased at about a VA percent annual rate
from the fourth quarter of last year through June,
while M3 fell slightly, placing these aggregates
around the lower bounds of their respective annual
growth ranges. In the usual pattern, increases in
rates on retail deposits and on money market
mutual funds have lagged the rise in market interest rates, inducing a redirection of savings from M2
into market instruments and boosting M2 velocity.
With returns on interest-paying checking accounts
virtually unchanged, compensating balance requirements for demand deposits reduced by rising rates,
and transactions balances also depressed by several
special influences, Ml growth this year has slowed
to less than half its rate of advance in 1993; through
June, this aggregate had expanded at about a 4 percent annual rate since the fourth quarter of last
year. Owing to the anemic expansion of transactions deposits, total reserves fell slightly over the
first half of the year. Only continued strong demand
for currency, much of which reflected use abroad,
has supported growth of Ml and the monetary
base.
In contrast to 1992 and 1993, shifts into bond
and stock mutual funds were not a major factor in
the rise in M2 velocity this year. Falling securities
prices created capital losses for bond and equity
mutual funds, prompting some fund holders to
reevaluate the risks and prospective returns of such
investments. Bond mutual funds experienced outflows this spring, and a portion of the proceeds was
directed to less-risky money market mutual funds,
thus elevating M2 for a time. Even with more
subdued moves in securities prices since the late
spring, many small investors have retained a more
cautious view of the possible risks and rewards of
Monetary Policy Report to the Congress
holding capital market instruments, and total
inflows to bond and stock mutual funds have
remained considerably weaker than in the past few
years. The effect of these slower flows on M2 has
been offset by shifts into direct holdings of market
instruments, such as Treasury bills. As a consequence, the sum of M2 and household holdings of
bond and stock mutual funds has decelerated
sharply this year.
Money and Debt Ranges for 1994 and 1995
At its July 1994 meeting, the Federal Open Market
Committee reviewed the annual ranges for money
growth for 1994 that it had established in February.
In light of the experience of thefirsthalf of the year
and the likelihood that funds would continue to be
diverted from deposits to higher-yielding market
instruments, the Committee expected a substantial
increase in the level of M2 velocity over 1994. M3
velocity also was seen as likely to rise quite
sharply, given the funding patterns of depository
institutions, which had been favoring sources of
funds not included in M3, such as capital and
borrowing from overseas offices. As a consequence, the Committee continued to expect that
money growth within, though perhaps toward the
lower end of, the ranges of 1 percent to 5 percent
for M2 and 0 percent to 4 percent for M3 would be
consistent with its broader objective of fostering
financial conditions that would sustain economic
expansion and contain price pressures. It therefore
voted to retain these ranges for 1994 (table 1). With
little information to suggest any new trends in
velocity for 1995, the Committee chose simply to
carry forward the 1994 ranges for M2 and M3 as
provisional ranges for those aggregates for 1995.
The Committee noted that these ranges, especially
that for M2, provided an indication of the longerrun growth of this aggregate that might be expected
with the attainment of reasonable price stability
and a return to the past pattern of velocity fluctuating around a constant long-run level. Considerable
uncertainty about the behavior of velocity is likely
to persist, however, and the Committee will continue to monitor a broad range of financial and
economic indicators in addition to the monetary
aggregates when determining the appropriate
stance of policy.
683
1. Ranges for growth of monetary and credit aggregates1
Percent
Aggregate
M2
M3
Debt2
1993
1994
Provisional for
1995
1-5
0-4
4-8
1-5
0-4
4-8
1-5
0-4
3-7
1. Change from average for fourth quarter of preceding year to average
for fourth quarter of year indicated.
2. Monitoring range for debt of domestic nonfinancial sectors.
The Committee also decided to retain its current
monitoring range of 4 percent to 8 percent for
growth of the debt aggregate during 1994. With
debt expanding at a rate close to that of nominal
income, the Committee's expectation for the
growth of nominal GDP for the year suggested that
the debt aggregate would finish the year comfortably within this range. However, the Committee
expected that in 1995, macroeconomic performance consistent with sustainable expansion would
involve some slowing of the growth of nominal
spending and moderate growth of debt; indeed,
rapid credit growth might suggest the possibility of
a borrow-and-spend psychology typical of strengthening inflation. Consequently, the Committee voted
to set a provisional monitoring range for debt
growth for 1995 of 3 percent to 7 percent, a reduction of 1 percentage point at each end of the range.
Economic Projections for 1994 and 1995
The members of the Board of Governors and the
Reserve Bank presidents, all of whom participate
in the deliberations of the Federal Open Market
Committee, generally anticipate that the growth of
real GDP will moderate during the second half of
this year and into 1995 from the unsustainable pace
in recent quarters (table 2). Employment gains
through the end of 1995 are expected to roughly
balance the net flow of individuals into the labor
force, leaving the unemployment rate about
unchanged from its average level in the second
quarter of this year. Inflation is expected to pick up
a little over the next year and one-half.
The forecasts of the Board members and Reserve
Bank presidents for economic growth in 1994 are
quite close to those made in February. Most continue to expect that real GDP will rise 3 percent to
684
Federal Reserve Bulletin • August 1994
resulting deceleration in private domestic spending
is expected to be offset, in part, by a smaller
decline in net exports than that registered over the
FOMC members and
nonvoting Reserve
past several quarters; this projection for the exterBank presidents
Administration
Measure
nal sector largely reflects an expectation of stronger
Central
D„
®
tendency
economic expansion abroad.
The Board members and Reserve Bank presi1994
dents generally expect the rise in the consumer
Change, fourth quarter
price index over the four quarters of 1994 to end up
to fourth quarter1
5'/4-6'/i
5'/2-6
5.8
Nominal GDP
in the range of 23A percent to 3 percent. So far this
3-3'/i
3-3 Vi
3.0
Real GDP
2l6-3Vi
23/4-3
2.9
Consumer price index2 ..
year, retail energy prices have been flat on balance
and retail food prices have moved up only a little,
Average level,
fourth quarter
restraining
the rise in the total CPI. However, given
3
6-6 Vi
6-6'/4
6.2
Unemployment rate
the run-up in crude oil prices of late and the
1995
improbability of another large drop in the prices of
fruits and vegetables, the rate of inflation projected
Change, fourth quarter
to fourth quarter1
for the next year and one-half is slightly higher
4'/2-6'/4
5-5'A
5.6
Nominal GDP
2'/4-23/4
2>A-2V4
2.7
Real GDP
than that posted recently. The decline in the dollar
3
2
2-4 Vi
2 A-3 'A
3.2
Consumer price index ..
to date, if not reversed, also could exert some mild
Average level,
upward pressure on inflation.
fourth quarter
53/4-6»/2
6-6 Vi
6.2
Unemployment rate3
The Administration recently released its mid1. Change from average for fourth quarter of preceding year to average
year update of economic and budgetary projecfor fourth quarter of year indicated.
tions. The projections for nominal and real GDP
2. All urban consumers.
3. Civilian labor force.
growth, inflation, and unemployment for 1994 and
1995 fall within the ranges anticipated by Federal
Reserve officials and are essentially consistent
31/4 percent over the four quarters of this year. For
with the central tendency of those ranges. Thus, it
1995, the central tendency of the forecasts is a
appears that the monetary ranges set by the Federal
3
range of 2Vi percent to 2 A percent. The unemploy- Open Market Committee are compatible with the
ment rate anticipated for the fourth quarter of 1994
goals of the Administration.
has been revised down about Vi percentage point
Both Federal Reserve policymakers and the
from that projected in February.2 The forecasts of
Administration anticipate further economic expanthe unemployment rate in the fourth quarter of
sion accompanied by relatively low inflation. The
1994 are now bunched between 6 percent and
Federal Reserve can do its part to prolong and
6V4 percent; this range is also the central tendency enhance this favorable performance of the econof the projections for the fourth quarter of 1995.
omy by continuing to set monetary policy in accord
These forecasts are based on the expectation that
with the long-run objective of price stability. An
the next several quarters will be a period of transienvironment of stable prices is a necessary condition to a more moderate expansion accompanied by
tion for attaining the maximum sustainable growth
reasonably full use of available resources. This
of productivity and living standards. However, the
transition is already evident in the housing market
outcome for the economy will also depend on
and, perhaps, in consumer outlays as well. The
government policy in other areas. In this regard,
the Congress and the Administration can help
ensure that the nation's economy reaches its full
2. The unemployment forecast in February was subject to an
potential by working to keep the federal budget
unusual degree of uncertainty, as it was made shortly after the
deficit on a downward course, by promoting an
introduction of major revisions to the survey that generates the
open world trading system, and by adopting regulaunemployment data. In February, the revised survey was believed
to have boosted the unemployment rate from January 1994 forward tory policies that preserve the flexibility of labor,
by roughly Vi percentage point. Subsequent analysis indicates that
product, and financial markets and minimize the
the upward shift caused by the new survey probably was smaller
costs imposed on the private sector.
than originally thought.
2.
Economic projections for 1994 and 1995
Percent
Monetary Policy Report to the Congress
THE PERFORMANCE
OF THE ECONOMY IN 1994
The economy entered 1994 with a considerable
amount of forward momentum. Severe winter
weather disrupted activity, but real GDP still posted
a solid gain in the first quarter, amounting to
3V2 percent at an annual rate. As had been the case
during 1993, domestic private-sector spending was
robust in the first quarter, with consumer purchases
of motor vehicles and investment in business
equipment both increasing at double-digit annual
rates. At the same time, the ongoing cutbacks in
defense spending depressed total purchases by the
federal government, and the sluggish economic
performance of some major foreign industrial countries held down the growth of U.S. exports.
The data in hand suggest that real GDP increased
substantially further in the second quarter. In the
labor market, gains in payroll employment and
longer workweeks appreciably boosted total hours
worked, and the civilian unemployment rate fell
further. The indicators of spending, although less
robust on balance than those for the labor market,
still point to a sizable increase in economic activity.
Inflation trends remained favorable over the first
half of this year, with the consumer price index
rising at an annual rate of only 2Vi percent over the
period. Inflation has been damped by the healthy
uptrend in productivity—which has offset much of
the increase in compensation rates—and by the
minimal rise in non-oil import prices. In addition,
the decline in crude oil prices through this spring
held down retail energy prices. However, oil prices
have since moved up considerably, and the rise
likely will boost retail energy prices over the summer. Prices have also risen substantially for many
industrial materials, but these increases have not
had a noticeable effect on the prices of finished
goods.
The Household Sector
Household balance sheets strengthened over 1992
and 1993, and the setback in stock and bond markets this year has not made a major dent in the
sector's financial position. In addition, real income
has continued to trend up at a healthy pace. Averag
685
ing through the monthly ups and downs, consumer
spending appears to have posted a sizable advance
over the first half of 1994, with most of the gain
coming in the first quarter. Higher mortgage rates
have cooled the growth of housing demand, but the
level of activity remains strong.
In the first quarter of 1994, real consumer spending rose at an annual rate of about 5VA percent,
building on the large increases registered during
the second half of 1993. Real outlays for motor
vehicles were particularly strong in the first quarter.
Spending on other durable goods, which had
advanced robustly during most of 1993, rose only
slightly in the first quarter, whereas outlays for
nondurable goods and services remained on a solid
uptrend. The severe weather that gripped much of
the country this winter left its mark on the monthly
pattern of outlays but appears to have had little
effect on the level of consumer spending for the
first quarter as a whole. Outlays for furniture and
appliances, clothing, and food all tumbled in January but then rebounded smartly over the remainder
of the first quarter. This pattern was reversed for
energy consumption, which soared in January and
then turned down.
The growth of real consumer spending appears
to have slowed in the second quarter, with much
of the deceleration reflecting declines in two
areas. First, consumer outlays for motor vehicles
softened in April and May, and the level of spending probably did not move up much, if at all, in
June. However, underlying consumer demand
has remained firmer than the recent spending
data would suggest, as vehicle sales in the second quarter were held down by shortages of popular models. Second, household use of electricity
and gas for the second quarter as a whole likely
will turn out to have been below the weatherboosted level of the first quarter. Apart from
these two categories, real consumer outlays
evidently posted a moderate increase in the second
quarter.
On a pre-tax basis, real income growth has been
brisk over the past year, buoyed by a considerable
gain in wages and salaries, a sharp increase in
the net income of nonfarm proprietorships, and an
upturn in interest income. However, the higher
personal income taxes imposed on upper-bracket
taxpayers by the 1993 Budget Act have cut into the
growth of disposable income. All told, the average
686
Federal Reserve Bulletin • August 1994
level of real disposable income in April and May
was about 3V2 percent above the level during the
same period in 1993. This rise in real income was
slightly smaller than the advance in real consumer
spending over the same time span.
According to preliminary estimates (which are
subject to potentially large revisions), the personal
saving rate averaged a bit less than 4 percent during the first five months of this year—quite a low
rate by historical standards. The level was so low
partly because of a one-time charge against income
to account for the wealth lost in the Los Angeles
earthquake. In addition, the higher taxes due on
returns filed this spring probably pushed down the
amount of personal saving. Still, a good part of the
decline in the saving rate from the 5 percent level
prevailing two years ago reflects a burst of spending on motor vehicles and other durable goods.
Such a decline in the saving rate often accompanies
cyclical surges in outlays for consumer durables,
which are counted as consumption in the national
accounts; in reality, much of the initial expenditure
on durables is a form of saving, as these goods are
assets that provide a flow of services for years to
come.
Household balance sheets have remained relatively strong despite the lower prices in financial
markets this year. The total value of household
assets—which includes not only financial assets,
but also housing and consumer durables—rose
moderately on balance over the year ended in the
first quarter of 1994. Moreover, survey data indicate that households, in the aggregate, continue to
view their current and expected financial positions
in a favorable light. This greater sense of financial
security, and the attendant willingness to take on
debt, help explain the rapid growth of consumer
credit since the middle of last year. Other measures
of household financial conditions also remain positive. Debt-service burdens, measured as a percentage of disposable income, held about steady in the
first quarter at a level well below the peak reached
several years ago. Delinquency rates for consumer
loans and home mortgages were little changed in
the first quarter, with most measures of delinquencies holding near their lowest levels in a decade or
more.
The market for single-family housing has softened in recent months. Starts of single-family
homes, which strengthened over the course of
1993, plummeted in January and remained low in
February. Much of this sharp decline can be attributed to adverse weather. With the return to more
normal weather in the spring, starts did recover, but
the rebound was relatively weak, leaving the May
level below that in the fourth quarter of last year.
Sales of both new and existing homes in May also
were down from their respective fourth-quarter
levels. In addition, consumer attitudes toward
homebuying have deteriorated somewhat since late
winter.
Nonetheless, the level of sales and building
activity in the single-family market has remained
fairly high. Even with the rise in mortgage rates,
new homes continue to be quite affordable by
the standards of recent decades. A simple measure
of affordability is the monthly payment on a
fixed-rate mortgage for a new home having a
given set of attributes, divided by average household income. By this measure, the cost burden
of homeownership in the second quarter of this
year was lower than at any time from mid-1973 to
early 1992. Moreover, in response to the rise in
long-term rates, an increasing share of households
have financed home purchases this year with
adjustable-rate mortgages (ARMs); the lower
initial rates on ARMs allow some households to
obtain financing when they would be unable to
qualify for a fixed-rate mortgage. As another support for housing demand, the strong labor market
in recent quarters has lessened the perceived
likelihood of job loss, encouraging many households to assume the financial commitment of
homeownership.
Starts of multifamily housing units this year have
picked up from the extraordinarily low levels registered from 1991 through 1993. This rise likely
reflects an improving balance between demand and
supply in some local markets. Lenders have shown
a greater willingness to fund multifamily projects,
owing not only to the firming real estate market,
but also to their own improved financial conditions; equity investors—including real estate
investment trusts—also have been participating
more actively in this market. However, for the
nation as a whole, vacancy rates for multifamily
rental units remain high and rent increases continue to be relatively small, suggesting that a
major recovery in this sector is unlikely in the near
term.
Monetary Policy Report to the Congress
The Business Sector
Developments in the business sector remained
favorable during the first half of 1994. Apart from
losses from the Los Angeles earthquake, earnings
have continued to be strong, and the repair of
balance sheets over the past few years has improved the access to credit for many businesses.
Fixed investment has moved up further, supported
by widespread efforts to boost productivity.
Business output, excluding that in the farm
sector, continued to increase at a brisk pace in the
first quarter. In real terms, the gross domestic
product of this sector rose in the first quarter at
an annual rate of 4lA percent, about the same rate
of advance recorded in 1993. Focusing on the
industrial sector—for which output data are
available on a more timely basis—production
advanced at an annual rate of 5 percent over the
first half of 1994, with the strongest gains registered early in the year. This pattern largely reflects
developments in the motor vehicle industry,
where production rose sharply from last August
to February of this year in response to strengthening demand and dwindling inventories. Since
February, assembly rates have moved lower on
a seasonally adjusted basis, as capacity constraints have hindered automakers from achieving their normal seasonal gains. Excluding
motor vehicles and parts, industrial production
continued to advance strongly in the second
quarter, j
After having risen sharply over 1993, the profits
of U.S. corporations from current operations fell
back in the first quarter of 1994. However, this
decline in economic profits appears to have been
due entirely to the effects of the Los Angeles
earthquake and the severe weather last winter; these
events greatly increased the volume of claims
against insurance companies and also resulted
in uninsured damage to plant and equipment.
Abstracting from these losses, pre-tax economic
profits in the first quarter rose slightly from the
already high fourth-quarter level. Profits of nonfinancial corporations have been boosted by the
strong growth in sales and by continued tight control of costs. For financial corporations, domestic
profits surged over 1993 and remained high in the
first quarter (after adjustment for the jump in
insurance payouts), buoyed by the relatively wide
687
margin between their cost of funds and the interest
rates earned on their assets.
Real outlays for business equipment continued to
rise rapidly in the first quarter, increasing about
17 percent at an annual rate. This was the eighth
consecutive quarter that showed a double-digit
advance. Monthly data through May on orders and
shipments of business capital goods point to further
sizable gains in real equipment purchases.
The increase in equipment investment this year
has been quite broad, asfirmshave attempted to cut
costs and improve product quality through the use
of more advanced technology. Real outlays for
computers and related devices climbed at an annual
rate of 20 percent in the first quarter, reaching a
level more than double that of three years earlier.
Businesses have invested heavily in computers to
take advantage of the increasingly powerful equipment available at ever-lower prices. Outlays for
industrial and other types of machinery, which
turned up in the middle of 1992, continued to
expand at a solid pace early this year. Business
spending for motor vehicles also rose substantially
in the first quarter, led by another large increase in
purchases of trucks; these purchases have likely
been bolstered by improvements in the safety and
efficiency of new models and by the increased
demand for shipping to support just-in-time inventory management. In contrast to this widespread
strength in investment, domestic purchases of commercial aircraft dropped in the first quarter to a
very low level, reflecting the excess capacity in the
airline industry.
Business investment in nonresidential structures fell sharply in the first quarter after having
posted a moderate gain over 1993. Severe weather
was responsible for the skid in activity during
January and February. Construction spending then
recovered during the spring, leaving the level in
May about the same as that registered in December of last year. The absence of growth, on net,
over this period might suggest that the sector
has lost some momentum, quite apart from the
effects of weather. However, the monthly construction data are prone to large revisions, which
limits the usefulness of the initial estimates. Two
leading indicators of private nonresidential
construction—permit issuance and contract
awards—remained on a choppy uptrend through
May.
688
Federal Reserve Bulletin • August 1994
Looking at the major components of nonresidential construction, some progress has been made in
reducing the huge stock of unoccupied office space,
and the plunge in prices for office properties
appears to have abated. Nonetheless, the national
vacancy rate remains high by historical standards,
and starts of new office buildings continue to be
limited. In contrast, outlays for commercial structures other than offices moved up smartly last year.
Financing for these projects has become more
readily available, and the proliferation of largescale discount stores in suburban locations has
been a major source of construction activity. In
the industrial sector, utilization rates have risen
considerably over the past year, but little sign
has yet emerged of a significant rise in construction of new plants. Public utilities, according to
surveys taken this spring, anticipate only a small
rise in investment this year, in part because of the
perceived difficulty in gaining approval for rate
hikes and because of new rules requiring utilities
to purchase power generated by other sources.
Meanwhile, real investment in petroleum drilling
structures fell somewhat in the first quarter, to
a level about unchanged from that of a year
earlier.
Nonfarm inventory investment during the first
five months of 1994 picked up substantially from
the pace of late last year. Part of the pickup
reflected efforts to replenish stocks at automotive
dealers, which had been depleted during the third
quarter of 1993. In addition, the rate of inventory
accumulation increased this year for producers of
machinery, likely in response to the robust orders
for these goods. At the wholesale level, stocks of
machinery and other durable goods increased considerably during the spring; the pace of stockbuilding in the retail sector spurted at about the same
time.
In the farm sector, output last year was depressed
byfloodsin the Midwest and by drought conditions
farther east. As a result, inventories of some major
field crops—principally corn and soybeans—
currently are unusually low. This year, changes in
government subsidy programs encouraged farmers
to increase their planted acreage, and favorable
weather during the spring facilitated rapid planting.
Although the harvest is still several months away,
field conditions appear to be reasonably good at
present.
Farmers hurt by bad weather last year suffered
income losses, and the financial positions of some
may have weakened. Nonetheless, the financial
condition of the farm sector as a whole appears to
be sound. Delinquency rates for farm loans at the
end of 1993 were quite low compared with the
experience of the past decade, and land values rose
noticeably last year across most of the farm belt.
Reflecting these favorable conditions, investment
in farm machinery has been relatively strong this
year.
The Government Sector
Federal purchases of goods and services—the part
of federal spending included in gross domestic
product—fell at an annual rate of 5 lA percent in
real terms in the first quarter. Real federal purchases have been trending down since the first half
of 1991, and the level of outlays in the first quarter
of this year stood roughly 12 percent below the
peak reached three years earlier. This decline has
been driven by the ongoing reduction in military
outlays. Real defense spending plunged at an
annual rate of about 15 percent in the first quarter
after having declined more than 9 percent over
1993. Real nondefense outlays jumped in the first
quarter, more than reversing the drop in late 1993;
however, given the appropriations for nondefense
spending in the fiscal year 1994 budget, these outlays are not likely to increase much further in the
near term.
As measured in nominal terms in the unified
budget, total federal expenditures during the first
eight months of fiscal 1994—the period from October through May—were only 2xh percent above the
level during the comparable part of fiscal 1993.
Although the drop in defense spending has figured
importantly in the overall restraint on outlays, other
factors have contributed as well. First, substantial
gains in income and the expiration of the emergency unemployment compensation program have
tempered the growth of income security payments.
Second, net interest payments on the national debt
have been about flat thus far in fiscal 1994, as a
further decline in the average interest rate paid on
federal debt has offset the effect of increases in the
stock of debt. In addition, farm subsidy payments
have fallen because of the rise in crop prices. The
Monetary Policy Report to the Congress
main stimulus to federal outlays still comes from
spending on Medicare, Medicaid, and other health
programs. Health-related outlays during the first
eight months of fiscal 1994 were up 10 percent
from the same period in fiscal 1993; this increase,
although about the same as that during fiscal 1993,
is considerably smaller than the increases registered during the preceding three fiscal years.
The growth of federal receipts was strong during
the first eight months of fiscal year 1994, with all
major categories posting solid gains. The 93A percent rise in receipts over the comparable part of
fiscal 1993 exceeded the increase in nominal GDP
by a wide margin. Receipts from corporate income
taxes have been especially robust, reflecting the
upswing in corporate profits and various provisions
of the 1993 Budget Act. Receipts from individual
income and social insurance taxes have also been
boosted by the tax hikes in the 1993 act. In addition, revenues from excise taxes thus far in fiscal
1994 are up markedly from the year-earlier level,
in part because of the higher tax on transportation
fuels that became effective last October.
As a result of the slow growth in federal outlays
and the robust rise in receipts, the federal budget
deficit narrowed during the first eight months of
fiscal 1994. The deficit, as measured in the unified
budget, totaled $165 billion during this period,
down from the $212 billion deficit recorded over
the same part of fiscal 1993.
In contrast to the improved budget picture at the
federal level, the fiscal pressures facing state and
local governments have not abated much. It is true
that for most states, receipts during the past year
have matched or exceeded projected levels, as economic growth turned out to be somewhat more
buoyant than anticipated. Even so, as measured in
the national income accounts, the deficit (net of
social insurance funds) in state and local operating
and capital accounts has remained large. The
$57 billion deficit during the year ended in the first
quarter of 1994 amounted to 6*A percent of the
sector's expenditures, about the same percentage as
in the preceding three years.
State and local outlays have continued to rise at a
fairly rapid pace despite efforts to curb spending.
Over the year ended in the first quarter of 1994,
these outlays increased 63A percent in nominal
terms, about 1 percentage point faster than the rise
in nominal GDP. Transfer payments to individuals
689
have remained the fastest growing component of
state and local spending, reflecting large increases
for Medicaid. Although the growth in Medicaid
spending has slowed markedly from the 30 percent
jump during 1991, these outlays still rose 13 percent over the year ended in the first quarter. In
addition, state and local governments remain under
pressure to fight crime, to repair aging infrastructure, and to meet the needs of a growing school-age
population. Boosted by higher spending on highways and schools, outlays for construction rose
almost 7 percent in real terms over the year ended
in the first quarter. This rise occurred even though
adverse weather depressed construction activity
early this year, dragging down total state and local
purchases in the first quarter in real terms. Apart
from transfer payments and construction spending,
state and local outlays—mainly compensation for
employees—have continued to grow at a relatively
slow pace.
The receipts of state and local governments
moved up about 6V2 percent in nominal terms over
the year ended in the first quarter, also outpacing
the growth in nominal GDP. As noted earlier, this
outcome was somewhat better than most states had
anticipated. In response, tax cuts are now on the
agenda in about one-third of the states. However,
most of these proposals are fairly narrow in scope
and, in the aggregate, would have only a small
effect on expected revenues.
The External Sector
Since December 1993, the trade-weighted foreign
exchange value of the dollar has declined about
8 percent relative to the currencies of the other
members of the G-10. In terms of the currencies of
a wider group of major U.S. trading partners, the
value of the dollar has dropped roughly 4 percent
since last December, when adjusted for changes in
consumer prices here and abroad. Taking a longer
view, the exchange value of the dollar—adjusted
for these price changes—has held within a rather
narrow range since the end of 1992 despite the
decline this year. (See the final section of this
report for a discussion of developments in foreign
exchange markets.)
Economic activity appears to be strengthening in
the major foreign industrial countries. In Canada
690
Federal Reserve Bulletin • August 1994
and the United Kingdom, where recovery has
been under way for some time, real GDP continues
to expand at a fairly steady pace. Continental
European countries, most of which were in recession during 1993, are showing signs of a turnaround. In western Germany, real GDP rose
moderately in the first quarter; although indicators
suggest that growth may have slowed somewhat
in the second quarter, economic activity continues
to move back toward pre-recession levels. There
is also some evidence of a turnaround in Japan:
After no growth on net in 1993, real GDP moved
up strongly in the first quarter; data for the second quarter point to continued, albeit slower,
expansion.
The level of real GDP remains substantially
below potential in all the major foreign industrial
countries, and inflation generally has continued to
slow. In western Germany, the twelve-month
change in the consumer price index was 3 percent
in June, down from more than
percent at the
end of 1993. In Japan, consumer prices rose less
than 1 percent over the twelve months ended in
June, an even more modest increase than that
recorded over the twelve months of 1993. Jobless
rates remain very high in France and drifted somewhat higher in western Germany over the first half
of this year. The unemployment rate in Japan is
essentially unchanged from its level at the end of
1993; the number of job offers per applicant, a
more sensitive indicator of labor market conditions
in Japan, also has shown no improvement since the
end of last year. In contrast, in both the United
Kingdom and Canada, the unemployment rate has
continued to edge down from the peaks reached in
mid-1993.
So far this year, growth in the major developing
countries appears to have slowed slightly, on balance, from its rapid pace in 1993. The growth of
real output in China has moderated from its previously very strong—and unsustainable—pace in
response to tighter macroeconomic policy, while
real growth in the other Asian developing countries
has remained robust on average. Real output in
Mexico has rebounded somewhat this year after
having declined during the second half of 1993.
The rebound appears to have been due in part to
the somewhat more expansionary fiscal policy
in Mexico and to the ratification of the North
American Free Trade Agreement, which resolved
uncertainty that had held down investment activity
during 1993.
After having surged in the fourth quarter of last
year, real U.S. exports of goods and services fell
back in the first quarter of this year; however, they
remained about 43A percent above the year-earlier
level. Preliminary data indicate that real exports in
April were somewhat above the first-quarter average. The uptrend largely reflects a boom in sales of
capital goods; for other goods, and for services as
well, exports have risen only slightly over the past
year. Looking across our major trading partners,
exports to Canada and Latin America remained on
an upward path through the first quarter. Although
exports to Asia dropped back in the first quarter,
they also remain on a strong upward trend. Exports
to continental Europe continued to expand sluggishly through the first quarter.
Real imports of goods and services posted
another sizable increase in the first quarter, reflecting the strength in U.S. economic activity. Over the
year ended in the first quarter, real imports jumped
more than 11 percent, and the level of imports in
April stood somewhat above that in the first quarter. Imports of capital goods and industrial supplies have continued to be especially robust. Prices
of non-oil imports rose relatively little over the
twelve months ended in May, as inflation abroad
generally remained subdued and the dollar's foreign exchange value against the currencies of the
other G-10 countries was little changed on net over
this twelve-month period.
The nominal trade deficit on goods and services
widened to $97 billion (at an annual rate) in the
first quarter, significantly larger than in any recent
quarter, and remained at about that level in April.
Net investment income showed a small deficit in
the first quarter, somewhat weaker than the average
performance in 1993. The current account deficit
widened to $128 billion (at an annual rate) in the
first quarter, compared with $104 billion for all of
1993.
Recorded net capital inflows for the first quarter
about balanced the current account deficit. Foreign
official inflows slowed, particularly on the part of
some developing countries that had substantial
accumulations of reserves in 1993.
Net inflows of private capital into the United
States picked up in the first quarter of 1994. Private
foreign net purchases of U.S. securities were strong,
Monetary Policy Report to the Congress
as foreign investors added to their holdings of U.S.
government securities, corporate bonds, and stocks.
U.S. net purchases of foreign securities also
remained very high in the first quarter. Banking
offices in the United States reported substantial
inflows, as foreign-chartered banks in particular
continued to substitute borrowing abroad for funding in the United States. Foreign branches of U.S.
banks also became net providers of funds to thenUS. offices. Direct investment inflows and outflows were spurred by a revival of mergers and
acquisitions. U.S. direct investment abroad continued at near-record levels; foreign direct investment
in the United States was also significant, although
far below the peaks reached in the late 1980s.
Labor Market Developments
The labor market continued to strengthen in the
first half of 1994. Nonfarm payroll employment
increased at an average rate of about 285,000 per
month during the period, up from the average
monthly gain of roughly 200,000 during 1993.
These increases brought the total rise in payrolls to
about 5 million since the beginning of the current
expansion in early 1991.
The job gains this year have been spread across
most major sectors of the economy. In manufacturing, employment turned up last October, and a
choppy advance continued during the first half of
1994. Hiring has been concentrated in two industries that have experienced robust sales growth,
machinery and motor vehicles; payrolls also have
expanded in industries that supply materials and
parts to these producers. In contrast, employment
in defense-related industries has continued to drop
this year. Meanwhile, construction employment,
held down early in the year by the severe weather,
moved up sharply in March and April and rose
somewhat further in May and June.
Considerable employment growth has also taken
place this year in the service-producing sector.
Continuing the pattern of recent years, employment
in business services rose at a rapid clip in the first
half of 1994. Employment in health services has
remained on a fairly brisk uptrend, and job gains
have been widespread in other service industries.
Another area of strength has been wholesale and
retail trade, where the sizable employment gains
691
recorded during 1993 and again this year contrast
with the lack of job growth on net over the preceding four years.
In addition to boosting the pace of hiring,
employers have continued to rely on a longer workweek to increase aggregate labor input. Indeed, in
April, the workweek of production or nonsupervisory workers in manufacturing reached a record
high for the post-World War II period; it has since
edged off only slightly. Before this expansion, the
typical pattern had been for the workweek to rise as
the recovery got under way but to drift back down
with the eventual pickup in hiring.
Firms have also shown an increased preference
for using temporary workers. In the employment
data, these workers appear on the payrolls of personnel supply agencies (a component of business
services), where employment growth continued to
be extremely fast in thefirsthalf of 1994. Although
these agencies represent only about 2 percent of
total payroll employment, they accounted for more
than 15 percent of the total rise in employment in
1993 and for nearly that share so far this year.
Manufacturing firms in particular have increased
their use of temporary workers. Both the growing
employment of temporary workers and the lengthening of the workweek may be motivated, in part,
by the desire to avoid the rising costs of health
insurance and other fringe benefits, which typically
are granted to new permanent workers. Moreover, given the greater costs now associated with
hiring and firing employees, such behavior may be
a response to uncertainty about future staffing
needs.
In January, the introduction of the redesigned
household survey, along with the incorporation of
population estimates from the 1990 census, created
a break in the household measure of employment,
the civilian unemployment rate, and numerous
other series. The decline in the unemployment
rate from January to June of 6.7 percent to 6 percent provides additional evidence of strong labor
demand this year. Unemployment rates by region
have generally moved lower since January, and the
dispersion across regions also has narrowed; the
declines since January have been largest in California and other states in the Pacific region and in
New England.
The strength in hiring has not drawn many workers into the civilian labor force. In fact, between
692
Federal Reserve Bulletin • August 1994
January and June the labor force contracted a bit,
pushing down the labor force participation rate—
which measures the percentage of the working age
population that is either employed or looking for
work. The participation rate has changed little on
net during the current expansion, in contrast to the
upswing that typically occurs with a strengthening
of labor demand. The reasons for this departure
from the usual pattern are not entirely clear. It
appears that more young women are opting for
activities outside the labor market. Also, according
to survey data, many individuals still perceive jobs
as hard to find, which may be limiting their desire
to search for employment.
Output per hour in the nonfarm business sector
rose at an annual rate of PA percent in the first
quarter after having advanced at a far more rapid
pace over the second half of 1993. Averaging
through these movements, labor productivity rose
about 2Vi percent over the year ended in the first
quarter of 1994, roughly in line with the increases
during the first two years of the current expansion.
Most of the productivity gain over this three-year
period likely reflects the normal cyclical upswing
that accompanies the strengthening of output after
a recession. Nonetheless, there does appear to have
been some speedup in the trend rate of productivity
growth from the relatively slow pace in the 1970s
and 1980s.
The growth in labor compensation remained subdued early this year. The employment cost index
(ECI) for private industry—a measure that includes
both wages and benefits—rose 3Vx percent over the
twelve months ended in March 1994, a shade
below the increase registered over the preceding
twelve months. The cost of employee benefits decelerated quite a bit over the past year, largely
because of more moderate increases in employer
costs for health insurance and workers' compensation. In contrast, wage increases have held fairly
stable. The ECI for wages and salaries rose almost
3 percent over the twelve months ended in March,
a figure at about the midpoint of the twelve-month
changes recorded over the past two years. Separate
data through June on average hourly earnings of
production or nonsupervisory workers also show
no significant change in the rate of wage inflation.
With the rise in labor compensation largely offset
by improvements in productivity, unit labor costs
in nonfarm business rose only a little more than
Vi percent over the year ended in the first quarter of
1994.
Price Developments
Inflation slowed slightly further during the first half
of 1994. The CPI excluding food and energy—a
measure of the underlying trend of inflation—rose
3 percent during the period, down a bit from the
3V* percent increases recorded in 1992 and 1993.
"Core" inflation has not been this low for an
extended period since the early 1970s, when wage
and price controls were in place; apart from that
episode, the core inflation rate over a twelve-month
span was last below 3 percent in 1966. Food prices
have risen only slightly this year, and energy prices
have been flat on net, holding the increase in the
total CPI over the first half of the year to 2Vi percent at an annual rate. Price pressures have been
evident in the markets for raw materials, but these
increases have not had an obvious effect on inflation at the retail level.
The news on food prices so far this year has been
quite favorable. After having risen at close to a
4 percent annual rate during the second half of last
year, the CPI for food edged up at an annual rate of
less than 1 percent over the first half of 1994. This
moderation largely reflects a decline in the prices
of fruits and vegetables over the first few months of
the year, which retraced much of the run-up that
occurred over the second half of 1993. In addition,
plentiful supplies of beef and pork pushed down
retail meat prices a bit on balance over the first half
of 1994. Prices of other foods—which represent
about two-thirds of total food in the CPI—i
increased at an annual rate of 2lA percent during
the first half of the year. Looking ahead, the path
for retail food prices will depend heavily on the
outcome of this year's harvest. As discussed
earlier, planting proceeded fairly smoothly this
spring, and crops generally were in good condition
as of mid-July.
The CPI for energy was about unchanged on
balance over the first half of 1994, but this measure
has yet to reflect the rise in crude oil prices since
March. As the year began, consumer energy prices
were still on a downward path, owing to the persistent oversupply of crude oil in world markets.
Energy demand then soared when the frigid
Monetary Policy Report to the Congress
weather hit in January and February, depleting
inventories of fuel oil, gasoline, and natural gas. In
response, the CPI for energy jumped in February
and rose slightly further in March, but most of this
increase was reversed in April and May. Quite
apart from any effects of abnormal weather, world
oil markets have tightened since March, boosting
the price of crude oil by as much as $6 per barrel.
This increase appears to have resulted from the
expectation of improved economic conditions—
and hence stronger demand—in Western Europe
and Japan, combined with flat OPEC production
and supply disruptions in the North Sea and other
areas. Retail energy prices were little changed in
June, but the higher costs of crude oil are likely
to be passed through to the retail level over the
summer.
The CPI for commodities excluding food and
energy increased at an annual rate of 2Vi percent
over the first half of 1994, a somewhat faster rise
than during 1993. However, the increase last year
was held down by a huge drop in the price of
tobacco products. Excluding tobacco as well as
food and energy, goods prices rose at an annual
rate of 2lA percent during the first half of this
year, about the same rate of advance as in 1993.
Price increases for most consumer commodities have been modest this year, owing in part
to the very limited increases in the prices of
imported goods. The only major area in which
prices have clearly accelerated is motor vehicles.
Reflecting strong demand and the weakness of
the dollar vis a vis the yen, the CPI for new
motor vehicles rose 43A percent over the first half
of 1994, up from the 3lA percent increase during
1993.
Inflation for consumer services other than energy
has continued to trend lower. During the first half
of the year, the CPI for this aggregate rose at an
annual rate of 3lA percent, after increases of nearly
4 percent in 1992 and 1993 and AVi percent in
1991. Shelter costs—which represent about half of
non-energy services—have continued to rise at a
relatively subdued rate, while price increases in a
variety of other areas have slowed. Indeed, the CPI
for medical care services rose only 5 percent over
the year ended in June, the smallest twelve-month
change in this series in twenty years. Tuition costs,
which posted increases of 8 percent to 9 percent
annually for several years, have decelerated as well,
693
rising 63A percent over the twelve months ended in
June.
The producer price index (PPI) for finished
goods excluding food and energy, which covers
domestically produced consumer goods and capital
equipment, rose only V2 percent over the twelve
months ended in June 1994. As with the CPI, this
measure of inflation has been held down by the
plunge in tobacco prices; excluding tobacco, the
13A percent rise over the twelve-month period was
about the same as that over the preceding twelve
months. At earlier stages of processing, price
increases have remained fairly small on balance.
The PPI for intermediate materials excluding food
and energy rose 2 percent over the twelve months
ended in June, after an increase of 1V2 percent over
the preceding twelve months.
In contrast, inflation pressures continue to be
evident in the markets for raw commodities. With
the exception of steel scrap, prices of industrial
metals have moved up from their lows last fall, in
some cases quite substantially. Lumber prices,
which have swung widely over the past few years,
have been at relatively high levels for most of this
year. Prices of other raw materials have been firm
as well. As a summary measure of these movements, the PPI for crude materials excluding food
and energy rose about 7 percent over the twelve
months ended in June. However, crude materials
constitute a relatively small part of the value of
finished goods, and price increases for these inputs
usually have a limited effect on the prices of finished goods in the absence of more general cost
pressures.
Expectations of inflation appear to have changed
little on net since the end of 1993. According to
the survey of households conducted by the Survey
Research Center of the University of Michigan, the
mean expected increase in the CPI over the coming
year rose from 33A percent in the fourth quarter of
1993 to 4V2 percent in March and April; however,
the readings for May through early July dropped
back to an average of about 4 percent. In the
Conference Board survey of households, the
expected rate of inflation over the coming year has
held fairly steady at AXA percent since last November. Expectations of inflation over longer periods
also have not changed much on balance this year.
In the University of Michigan survey, the expected
rate of CPI inflation over the next five to ten years
694
Federal Reserve Bulletin • August 1994
jumped in March but has since retraced the
increase. Finally, the June 1994 survey of professional forecasters conducted by the Federal
Reserve Bank of Philadelphia produced the same
expectation of inflation over the coming ten
years—3.5 percent—as did the survey taken last
December.
MONETARY AND FINANCIAL
IN 1994
DEVELOPMENTS
Interest rates have increased substantially in 1994.
Short-term rates started the year at the unusually
low levels that prevailed throughout 1993, but they
have subsequently risen in response to the Federal
Reserve's monetary policy actions and market
expectations about future actions. The Federal
Reserve has moved away from its previously very
accommodative policy posture in four steps, which
lifted the federal funds rate a total of 1 lA percentage points. Other short-term rates increased commensurately, and banks raised their prime lending
rate, also by 1 lA percentage points.
Longer-term interest rates have risen about 1 lA
to 13A percentage points. These rates have been
boosted by stronger-than-expected economic
growth, market concerns about higher inflation,
and actual and anticipated tightening moves. In
addition, a shift in the financial setting, from one
marked by yields that were stable or declining to
one characterized by rising rates, was accompanied
by greater market volatility and a reevaluation of
the risks of and returns on long-term securities.
Investors seemed to become more uncertain about
the future path of interest rates, and the resulting
portfolio shifts and volatility have contributed to
the upward pressure on long-term yields at times.
Despite the rise in interest rates, overall borrowing has remained fairly strong. The composition of
private borrowing, however, has been affected by
financial market conditions. Businesses, in particular, have reduced their issuance of long-term debt
and stepped up their use of bank loans. Nonetheless, overall bank lending has increased only
slightly, as growth in real estate loans has slowed.
The expansion of bank securities holdings, after
adjustment for certain accounting rule changes,
has eased slightly, and bank credit growth has
remained close to the pace recorded last year.
Higher short-term market interest rates have also
restrained the monetary aggregates. Growth of the
broader aggregates has slowed somewhat from
last year, and growth of Ml has decelerated
substantially.
Since December 1993, the dollar has declined
about 10 percent against the German mark and
about 11 percent against the Japanese yen,
although it has appreciated against the Canadian
dollar. Over the same period, stronger growth prospects abroad as well as portfolio adjustments by
globally diversified investors have lifted long-term
interest rates in the G-10 countries about IV2 percentage points, similar to the rise in U.S. longerterm yields. By contrast, foreign short-term rates,
which largely reflect the thrust of monetary policy
in individual countries, are about unchanged on a
trade-weighted basis; rates have declined substantially in Germany and a number of continental
European countries, have changed little in Japan,
and have risen more in Canada than in the United
States. Dollar weakness against the yen and mark
was intense from time to time and seemed to
reflect, in part, difficulty in resolving trade tensions, changing expectations about macroeconomic
developments in Japan and Germany, and investor
concerns that U.S. inflation prospects were no
longer improving while inflation abroad seemed
likely to continue to move lower. On three occasions when conditions warranted, the U.S. Treasury
and the Federal Reserve intervened to buy dollars.
The Course of Policy and Interest Rates
At the beginning of 1994, financial markets had
been characterized for several years by falling and
then persistently low short-term interest rates,
declining long-term rates, and unusually wide
spreads between long- and short-term yields. Moreover, the volatility of bond prices had been quite
low by recent historical standards. In this environment, investors had taken on riskier assets in pursuit of higher returns. For example, small investors
had switched out of low-yielding, but low-risk,
assets such as deposits and money market mutual
funds and into such investments as bond and equity
mutual fund shares.
In February, when the Federal Open Market
Committee gathered for its first meeting of the
Monetary Policy Report to the Congress
year, the available data suggested that the economic expansion was solid and self-sustaining.
Spending had picked up considerably, partly
reflecting declines in long-term interest rates and
the improved financial condition of businesses and
households. Short-term interest rates had been at
historically low levels for some time, measured
both absolutely and relative to inflation, and banks
and other lenders had been loosening their terms
and standards for extending credit. In this environment, the Committee was concerned that keeping
policy so accommodative risked elevating demands
on productive capacity to the point where inflation
pressures might emerge. Even though current inflation readings were favorable, delaying a policy
move until these indicators signaled an actual
acceleration of prices would permit an inflationary
process to become embedded in the economy. In
that event, larger and possibly disruptive actions
eventually would be needed to bring inflation back
under control. Against this backdrop, the Committee decided to take steps toward eliminating the
considerable degree of monetary accommodation
that had prevailed for some time.
When discussing how to implement this decision, the Committee considered the possible reaction offinancialmarkets. Market participants, while
anticipating that interest rates would rise at some
point, generally did not expect a tightening of
policy at this meeting. The Committee was concerned that the capital losses engendered by the
firming action might unsettle many investors, who
had not faced a policy firming in nearly five years
and whose portfolio choices in some cases seemed
not to anticipate the consequences of rising rates.
In these circumstances, the response to the policy
action might be outsized, especially if a large
adjustment were made. Consequently, the Committee decided to initiate its move toward a less
accommodative stance with a small step, although
it thought that additional firming steps likely
would be necessary in the months ahead. The
Committee instructed the Domestic Trading Desk
to increase slightly the degree of pressure on
reserve positions and authorized the Chairman to
announce the action so as to avoid any misinterpretation of its action or purpose. The tightening
of reserve conditions pushed up the federal funds
rate about lA percentage point, to a range around
3lA percent.
695
Although a policy firming in the months ahead
was built into the structure of market interest rates,
the timing of the move caught many market participants by surprise and, by itself, seemed to precipitate a substantial shift in expectations. When the
move was followed by information indicating a
much stronger path for U.S. economic activity
than had been anticipated and by an associated
heightening of concerns about inflationary pressures, short- and long-term interest rates moved
sharply higher throughout the remainder of the
winter. International developments—such as trade
tensions, improving economic prospects, rising
long-term interest rates, and a declining value of
the dollar—also may have played a role in elevating yields by raising investor concerns about price
pressures in the United States and about foreign
investor appetite for dollar-denominated assets.
Rates were volatile on occasion, owing to shifting
perceptions about the future course of economic
and financial developments. Market participants
generally believed that the System's firming action
was the first of a series, but they were unsure of the
timing and cumulative magnitude of future policy
steps. This heightened uncertainty, as well as the
capital losses in the wake of the firming action,
prompted market participants to reduce their risk
exposure by attempting to shorten the maturities of
their investments and by trimming the degree to
which positions were leveraged. They sold longterm assets denominated not only in dollars but in
other currencies as well. This rebalancing of portfolios contributed to sharp rate swings and may
have exacerbated the upward pressure on longterm interest rates, both in the United States and
abroad.
When the Federal Open Market Committee convened in mid-March, the evidence suggested that
the expansion of economic activity remained
robust. There was a small risk that the weakness
and volatility in financial markets might have significantly affected household and business confidence and spending. However, the Committee
believed that, on balance, its policy stance still was
overly accommodative and likely to promote inflationary pressures. It therefore decided to continue
the process begun in February to remove the excess
degree of monetary accommodation and, in light
of recent financial market conditions, chose to
take another small step. The resultant increase in
696
Federal Reserve Bulletin • August 1994
reserve pressures lifted the federal funds rate
l
A percentage point, to about 3V2 percent.
Data released over the next several weeks indicated considerable strength in economic activity.
Yields increased across the maturity spectrum, with
long-term rates rising especially sharply into early
April before settling back somewhat. On April 18,
the Committee reviewed the incoming data, as well
as the apparently more stable conditions in financial markets, during a telephone consultation. Following that review, Committee members supported
the Chairman's decision to continue the process of
reducing the degree of monetary accommodation.
Reserve pressures were tightened slightly further,
and the federal funds rate again rose lA percentage
point.
Yields continued to increase, on balance, through
mid-May. Short-term rates were affected by expectations of additional firming actions, while longterm rates were subject to countervailing forces.
Incoming data that showed signs of a possible
cooling in the pace of the economic expansion,
favorable price reports, and more stable trading
conditions helped push bond yields down for a
time. Later, however, a falling dollar, especially in
late April and early May, and the release of a
stronger-than-expected employment report caused
long-term yields to retrace some of the earlier
decline.
Despite the earlier firming actions, real shortterm rates were still fairly low at the time of the
May Committee meeting. The economy continued
to exhibit forward momentum, and a considerable
portion of the remaining margin of slack in
resource utilization had eroded. In financial markets, many of the more risk averse investors had
made the initial portfolio adjustments to a rising
rate environment. Under these circumstances, the
Federal Reserve thought that conditions warranted
eliminating much of the remaining degree of monetary stimulus. The Board of Governors, therefore,
approved an increase in the discount rate to 3V6 percent, from 3 percent, and the Committee directed
the Domestic Trading Desk to permit the entire
Vi percentage point rise to show through to the
federal funds rate, which moved up to A1 A percent.
These moves, along with the three earlier steps,
were judged to have substantially removed the
degree of monetary accommodation that had prevailed throughout 1993. Still, the Committee would
have to monitor incoming financial and economic
data carefully to determine whether additional
policy adjustments were needed to accomplish
its objective of maintaining favorable trends in
inflation and thereby sustaining the economic
expansion.
Long-term interest rates dropped immediately
following the May 17 policy moves, but since that
time they have retraced the decline. Market participants initially interpreted the Federal Reserve's
policy announcement as signaling that it had completed its firming actions, at least for a while. In
addition, investors apparently viewed the actions as
reducing the degree and frequency of tightening
that might be needed in the future. Long-term
yields began to move up in June, however, reflecting the further depreciation of the dollar, intermittent jumps in commodities prices, less sanguine
inflation reports, and rising foreign long-term interest rates.
At the time of the July Committee meeting, data
on employment and hours worked suggested that
the economy was still growing at a brisk rate, and
there remained a risk that an inflationary process
could begin to build. However, data on spending
showed some signs of moderation, and growth of
money and credit had not picked up. In these
circumstances, the Committee decided to maintain
the existing degree of reserve pressure and await
additional information to judge the trajectory of the
economy and prices and the appropriateness of its
policy stance.
Credit and Money Flows
Since mid-1993, credit expansion has picked up as
the economy has strengthened and the restraint
exerted byfinancialrestructuring has ebbed. Lower
debt-service burdens and improved balance sheets
have encouraged businesses and households to take
on new debt, while stronger capital positions and
more robust economic conditions apparently have
made banks and other lenders more willing to
extend credit. Growth of the debt of nonfederal
nonfinancial sectors (nonfinancial businesses,
households, and state and local governments)
picked up in the second half of 1993 and has
increased a bit more this year—to a 5 percent
annual rate. Total domestic nonfinancial sector
Monetary Policy Report to the Congress
3.
697
Growth of money and debt
Percent
Ml
M2
M3
Domestic
nonfinancial debt
Year1
1980
1981
1982
1983
1984
7.4
5.4 (2.5 2)
8.8
10.4
5.5
8.9
9.3
9.2
12.2
8.1
9.6
12.4
9.9
9.9
10.9
9.1
9.9
9.6
12.0
14.0
1985
1986
1987
1988
1989
12.0
15.5
6.3
4.3
.6
8.7
9.3
4.3
5.3
4.8
7.6
8.9
5.7
6.3
3.8
14.2
13.4
10.3
9.0
7.8
1990
1991
1992
1993
4.2
7.9
14.3
10.5
4.0
2.9
1.9
1.4
1.7
1.2
.5
.6
6.6
4.6
5.0
5.0
Semiannual (annual rate)3
1994:H1
4.0
1.6
-.1
5.4
Quarter (annual rate)*
1994:Q1
Q2
6.0
2.0
1.8
1.5
.2
-.3
5.9
4.7 5
Measurement period
1. From average for fourth quarter of preceding year to average for fourth
quarter of year indicated.
2. Adjusted for shifts to NOW accounts in 1981.
3. From average for fourth quarter of 1993 to average for second quarter
of 1994. For debt aggregate, data for second quarter are through May.
4. From average for preceding quarter to average for quarter indicated.
5. Based on data through May.
debt, which includes the debt of the federal government, rose at a 5VA percent annual rate between the
fourth quarter of last year and May, close to its
pace over the second half of 1993 and a little below
the midpoint of its monitoring range of 4 percent to
8 percent. (Historical data on the growth of the
money and debt aggregates appear in table 3.)
Rising market interest rates and less-hospitable
capital market conditions have affected the growth
and composition of borrowing by nonfinancial
businesses. The debt of such firms has expanded at
a somewhat faster pace in 1994 after three years of
very little growth, in part reflecting a shift away
from equity issuance as stock prices fell. Moreover,
rising and more-volatile interest rates have played a
role in discouraging businesses from issuing longterm debt securities. Such issuance had been strong
in 1993 as businesses took advantage of relatively
low interest rates to refinance high-rate longer-term
debt and replace shorter-term debt, such as bank
loans. In 1994, however, businesses have turned
more to banks and finance companies to meet their
financing needs.
Interest rate developments have also affected
borrowing by households. The growth of household mortgage debt has slowed a bit from the pace
recorded in the second half of 1993, reflecting the
rise in mortgage rates that began late in that year.
Higher rates have curbed refinancing, a practice
that tended to boost mortgage debt growth as some
borrowers took the opportunity to liquefy some of
the capital in their homes. In contrast to the behavior of mortgage debt, consumer credit growth has
remained brisk, reflecting strong demand for consumer durable goods and relatively attractive rates
on many consumer loans. Generally, rates on such
loans have risen much less than market rates. Consumer credit at both finance companies and banks
has picked up in 1994.
Total loans at commercial banks have risen at
about a AlA percent annual rate, a bit above last
year's pace. The faster growth of business and
consumer loans has been offset by slower expansion of other types of loans, such as those for real
estate. In addition, security loans have dropped off
as the more subdued pace of debt issuance and the
paring of dealer long positions in a rising rate
environment have reduced dealerfinancingneeds.
The expansion of bank lending in 1993 and
1994, following two years of virtually no growth,
has reflected not only stronger loan demand but
also an increased willingness on the part of banks
698
Federal Reserve Bulletin • August 1994
to make loans. This heightened desire to extend
credit stems from the improved financial condition
of banks as well as their borrowers. In the early
1990s, banks had been pressed by balance sheet
problems and the need to meet more stringent
requirements for capital-asset ratios. By early
1993, however, the capitalization ratios of many
banks were considerably stronger, and they have
continued to improve since then as banks issued
sizable volumes of equity and retained a high proportion of their record earnings. In mid-1993, some
banks began to report an easing of their standards
and terms for business loans and residential mortgages, and this easing has continued, albeit at a
reduced rate, into the first two quarters of 1994.
Measured growth of holdings of bank securities
this year has been affected by two accounting
changes. One change affects how banks report, on
their balance sheets, the fair market value of offbalance-sheet items. Banks are no longer permitted
to net positions in these items across customers;
this change has appreciably boosted the "other
securities" component, where these positions are
booked. The other change in accounting rules
requires banks to value at market prices those securities that they do not plan to hold to maturity. With
the decline in securities prices this year, the requirement of "marking to market" likely has restrained
the measured growth of bank securities portfolios,
although to an uncertain extent. Abstracting from
these special factors, growth of bank securities
holdings likely has slowed slightly further in 1994.
This slowing has been about offset by the pickup in
loan growth, leaving underlying bank credit growth
close to the pace recorded last year. Meanwhile,
thrift institution credit has resumed expanding this
year, albeit modestly, after declining over the past
five years. Expansion at credit unions has been
robust, while the contraction of the remainder of
the thrift sector has slowed somewhat further.
Despite the expansion of depository credit, the
broadest monetary aggregate, M3, has edged a bit
lower since the fourth quarter of last year, as depository institutions have chosen to fund growth in
assets with nondeposit sources. In June, M3 was
around the bottom of the 0 percent to 4 percent
growth range established by the Federal Open
Market Committee, and its velocity seems to be
increasing faster this year than in 1993. The weakness in M3 partly reflects an exodus of investors
from institution-only money market mutual funds,
whose returns have lagged the rise in market rates.
M3 has also been held back by declines in large
time deposits. The run-off in this component has
been concentrated at U.S. branches and agencies of
foreign banks, which have stepped up their borrowings from affiliated foreign offices. Domestic banks
have also boosted such borrowings. In December
1993, domestic banks for the first time borrowed
more from their foreign affiliates than they lent to
them. This net borrowed position has expanded
considerably since that time. Apparently, weaker
credit demands abroad have held down the costs of
borrowing overseas relative to the costs of obtaining funds in the United States.
M2 growth has slowed a bit in 1994, and its
velocity appears to have registered another sizable
increase. The major factor behind the rise in velocity this year has been higher short-term market
interest rates. In the usual pattern, the increases in
rates paid on M2 deposits and money market
mutual funds have lagged behind the rise in market
rates, boosting the earnings forgone (opportunity
costs) by holding the components of M2 and thus
inducing shifts out of the aggregate. For example,
noncompetitive bids at Treasury auctions have
increased sharply this year, and some of the funds
likely were drawn from the instruments included in
M2. Moreover, the composition of M2 has been
affected by the varying speed with which rates on
different components have adjusted to higher market yields. Rates on money market mutual funds
and retail certificates of deposit (CDs) have moved
up considerably since February, while rates on
liquid deposits, such as savings and NOW
accounts, have been virtually unchanged. Partly as
a consequence, holdings of money market mutual
funds have increased, small CDs have turned
around, and liquid deposit growth has languished.
From the fourth quarter of 1993 through June, M2
expanded at a VA percent annual rate, placing
this aggregate around the lower bound of the
1 percent to 5 percent growth range set by the
Committee.
The depressing effect of higher interest rates on
M2 was offset for a time by flows from bond and
equity (or long-term) mutual funds into money
market mutual funds. Declining securities prices
and higher volatility prompted households to reconsider their investments in long-term mutual funds
Monetary Policy Report to the Congress
and encouraged many to liquidate some of their
bond and equity mutual fund holdings. Over the
March-to-May period, households pulled more
money out of bond funds than they invested. A
portion of the proceeds from the redemptions likely
was placed in money market mutual funds, which
grew quite rapidly. As changes in securities prices
became more subdued in late May, flows into longterm mutual funds began to pick up, but they have
remained weak by the standards of recent years.
Shifts from M2 into direct holdings of securities,
such as Treasury bills, as well as the capital losses
on long-term mutual funds, have damped the
growth of a measure that adds to M2 the net assets
of mutual funds not held by institutional investors
or in retirement accounts. This series has grown at
an estimated 1 percent annual rate this year, well
below its 5V2 percent advance in 1993. Its velocity
therefore also has increased, after several years of
rough stability.
Ml growth has been restrained by wider opportunity costs as well as some special factors. From
the fourth quarter of last year through June, Ml
expanded at about a 4 percent annual rate, less than
half of its IOV2 percent rise in 1993. Ml velocity,
which fell at a 5 percent rate last year, appears to
have increased this year. The growth of Ml has
stemmed primarily from the continued rapid rise in
currency, as overseas demand has remained robust
and domestic demand has expanded with sales. In
contrast, increases in transactions deposits have
been quite weak. Growth of demand deposits,
which pay no interest, has been reined in by higher
market rates, the associated rise in earnings credits
on compensating balances, and a drop-off in
mortgage refinancings. Refinancings boost liquid
deposits—especially demand deposits—because
they are accompanied by a temporary parking of
funds in such accounts; however, as the volume
of refinancings declines, deposits return to more
normal levels. Rate spreads have also depressed the
growth of other checkable deposits, whose offering
rates have changed little since the beginning of the
year. In addition, growth has been restrained by a
large bank's introduction of a program that sweeps
excess balances out of NOW accounts and into
money market deposit accounts. (The program,
therefore, has no impact on M2.) The anemic
expansion of transactions deposits has contributed
to a decline in total reserves. This reserve measure
699
has contracted at a VA percent annual rate so far
this year, a stark contrast with its 12 percent expansion in 1993. The continued strong demand for
currency has propped up growth of the monetary
base, whose growth has slowed only slightly this
year, to a 9lA percent annual rate.
Foreign Exchange Developments
After starting the year with a firm tone, the dollar
declined on balance from February through late
April. The dollar was supported initially by market
expectations that it would rise over the near term as
the U.S. economy strengthened and U.S. interest
rates rose, in contrast to expected developments
abroad. Following the Committee's firming action
on February 4, the dollar rose only modestly and
briefly, in part because foreign long-term rates
increased with U.S. rates. In the weeks that followed, the dollar weakened with respect to the yen,
especially in mid-February, when market participants became more concerned about the sizable
external surpluses in Japan in the wake of the lack
of progress in the framework talks between the
United States and Japan. The dollar also came
under downward pressure against the German
mark, particularly in February and March. Continued strong growth in German M3, amid signs of
economic revival, suggested that further sizable
cuts in German and other European rates were not
as likely as had been previously thought, and longterm rates in these countries increased further. In
early April, the dollar came under renewed downward pressure in terms of the yen. The resignation
of Prime Minister Hosokawa rejuvenated concerns
that progress on negotiations to open Japanese markets would stall and that plans to stimulate the
Japanese economy would not be implemented.
Market sentiment against the dollar became particularly strong in late April and early May, in
sometimes disorderly markets. On April 28, with
U.S. bond prices falling, the dollar approached its
postwar low against the yen in thin trading, and on
the following day it started to drop sharply against
the mark as trading became more volatile. In
response, the Foreign Trading Desk at the Federal
Reserve Bank of New York entered the market and
purchased dollars against both marks ($500 million) and yen ($200 million). Treasury Secretary
700
Federal Reserve Bulletin • August 1994
Bentsen confirmed the intervention and explained
that it was prompted by disorderly market conditions. The dollar recovered briefly but resumed
falling over the next several days. On May 4, the
U.S. Treasury and the Federal Reserve joined other
monetary authorities in substantial, coordinated
intervention in support of the dollar. Secretary
Bentsen again confirmed the intervention and said
it was in response to exchange market developments that were inconsistent with economic fundamentals. These actions stemmed the slide of the
dollar and contributed to a partial recovery over the
subsequent two weeks.
The dollar fluctuated in a narrow range following the May 17 policy actions by the Federal
Reserve, but it later lost ground. These policy
actions were consistent with the view expressed
in the statement accompanying the May 4 intervention that the U.S. Administration did not
believe that the prospects for the U.S. economy
warranted a weak dollar. However, in mid-June,
the dollar declined against the yen as market
perceptions resurfaced that the United States
was not concerned about a weak dollar, despite
official statements to the contrary, and as an easing
of trade frictions with Japan appeared less likely
following the resignation of Prime Minister Hata
on June 24. Downward pressure on the dollar in
terms of the German mark intensified at this time
as additional data confirmed that an economic
recovery was under way in Germany. These data
contributed to higher long-term rates and reinforced views that Bundesbank official rates were
not likely to be reduced further following the substantial adjustment on May 11. The selling pressure
on the dollar may also have been exacerbated by a
rise in dollar-denominated commodity prices,
which market participants viewed as indicative of a
risk of higher U.S. inflation. With the dollar hovering around a postwar low against the yen on
June 24, the United States led substantial coordinated intervention with the monetary authorities of
the G-7 countries and a number of other countries.
Secretary Bentsen confirmed the intervention,
citing shared concerns over recent developments in
foreign exchange markets. Since that time, sentiment against the dollar has continued, with the
dollar recording a new postwar low against the yen
on July 12 before rebounding moderately in subsequent days.
Federal Reserve Foreign Currency
Transactions
The Federal Reserve has undertaken other foreign
currency transactions in 1994 in addition to the
intervention actions of April 29, May 4, and
June 24. The Federal Open Market Committee has
authorized a restructuring of the System's portfolio
of foreign currencies and has approved three reciprocal currency arrangements, also known as swap
arrangements.
At its December 1993 meeting, the Committee
authorized the Manager for Foreign Operations to
sell all non-mark and non-yen foreign exchange
reserves held by the Federal Reserve. The Manager
sold these reserves, which were equivalent to
$750 million, during the first few months of 1994.
These holdings along with those of the Exchange
Stabilization Fund of the U.S. Treasury were eliminated in light of the practice of U.S. monetary
authorities in recent years to conduct intervention
operations exclusively in marks and yen.
On March 24, the Committee approved a temporary increase to $3 billion, from $700 million, in
the System's swap arrangement with the Bank of
Mexico. The value of the Mexican peso against the
dollar had been nearly stable during the initial
weeks of the year, following ratification of the
North American Free Trade Agreement by the
United States in November. The peso began to
weaken in late February, however, in response to
disappointing economic news and political unrest
in Mexico. The assassination of presidential candidate Luis Donaldo Colosio on March 23 further
undermined the peso, which fell to the lower intervention limit against the dollar set by the Bank of
Mexico. Mexican authorities then intervened
heavily to support the peso. At the request of the
Mexican government and the Bank of Mexico,
U.S. monetary authorities established a $6 billion
temporary bilateral swap facility for the Bank of
Mexico, which was split between the U.S. Treasury
and the Federal Reserve. The swap was intended
to help prevent any turmoil in Mexican markets,
which could have spilled into U.S. financial markets. In the event, no drawings were made on
this facility. In late April, the peso moved away
from its lower intervention limit as the substantial increase in Mexican interest rates persuaded
market participants of the commitment of the
Monetary Policy Report to the Congress
Mexican government to maintain the value of the
peso.
On April 26, the monetary authorities of the
United States, Canada, and Mexico announced the
creation of the North American Financial Group to
provide an opportunity for more regular consultation on economic and financial developments.
Plans for this group had been under way for several
months in recognition of the increasing interdependence of the three economies. In connection with
the formation of the group, the authorities of the
three countries established a trilateral foreign
exchange swap facility. The United States and
Mexico put in place swap arrangements for up
701
to $6 billion, with the Treasury and the Federal Reserve each participating up to $3 billion.
The Federal Reserve and the Bank of Canada
reaffirmed their existing swap agreement of $2 billion and extended its maturity to December 1995.
The Bank of Canada increased its swap line
with the Bank of Mexico to 1 billion Canadian
dollars. These arrangements expand the pool of
potential resources available to the monetary
authorities of each country to maintain orderly
exchange markets. The Federal Open Market Committee approved the Federal Reserve's participation in these arrangements effective April 26.
•
702
Industrial Production and Capacity Utilization
for June 1994
Released for publication July 15
Industrial production rose 0.5 percent in June; revisions for the preceding three months were, on net,
slightly positive. A surge in demand for electricity,
caused by unseasonably hot weather, resulted in a
sharp increase in the output of electric utilities.
Apart from this rise, total industrial production for
the month increased only 0.1 percent.
The utilization of total industrial capacity rose
0.3 percentage point, to 83.9 percent. The rise
in operating rates at utilities more than accounted
Industrial production indexes
Twelve-month percent change
Twelve-month percent change
Capacity and industrial production
Ratio scale, 1987 production = 100
Ratio scale, 1987 production = 100
Total industry
90
80
70
All series are seasonally adjusted. Latest series, June. Capacity is an index of potential industrial production.
703
Industrial production and capacity utilization, June 1994
Industrial production, index, 1987=100
Percentage change
Category
1994
19941
Mar.r
Apr.r
Mayr
June?
116.8
Total
115.9
116.1
116.3
Previous estimate
115.7
115.9
116.1
Major market groups
Products, total2
Consumer goods ...
Business equipment
Construction supplies
Materials
114.7
111.9
145.5
99.7
117.7
114.9
111.6
146.2
101.6
117.9
115.0
111.5
147.0
102.1
118.1
115.6
117.2
121.7
111.7
99.5
117.6
122.3
111.8
99.9
116.3
117.8
118.0
122.7
Major industry groups
Manufacturing
Durable
Nondurable
Mining
Utilities
118.0
112.1
147.7
102.3
118.7
122.2
112.2
112.4
98.8
117.3
98.2
123.7
Mar.r
Mayr
Apr/
June?
5.8
.4
.3
.4
.8
1.3
1.0
.6
1.4
.7
-1.6
.2
5.5
3.8
10.3
7.4
-.3
.5
2.0
.2
6.2
.3
.5
.2
-.1
.2
.1
.5
-.1
.4
-1.4
-1.2
-.5
5.4
.4
.9
1994
1993
Low,
1982
High,
1988-89
6.1
8.6
3.0
.3
7.1
MEMO
Capacity utilization, percent
Average,
1967-93
June 1993
to
June 1994
June
Mar.r
Apr.1
Mayr
JuneP
Capacity,
percentage
change,
June 1993
to
June 1994
Total
81.9
71.8
84.8
81.1
83.8
83.7
83.6
83.9
2.3
Manufacturing
Advanced processing
Primary processing ..
Mining
Utilities
81.2
80.6
82.2
87.4
86.7
70.0
71.4
66.8
80.6
76.2
85.1
83.3
89.1
87.0
92.6
80.1
78.6
83.8
88.0
86.3
83.0
81.6
86.3
89.9
87.5
83.0
81.5
86.7
90.4
86.1
82.9
81.3
87.0
89.3
86.8
82.8
81.2
86.8
88.8
91.4
2.7
3.3
1.2
-.7
1.2
NOTE. Data seasonally adjusted or calculated from seasonally adjusted
monthly data.
1. Change from preceding month.
for the gain; the operating rate at factories edged
down.
At 116.8 percent of its 1987 average, total industrial production was 5.8 percent higher in June than
it was a year earlier. Output grew 4.4 percent at an
annual rate in the second quarter, down from
8.3 percent at an annual rate in the first quarter. The
slowdown resulted mainly from a decrease in the
seasonally adjusted production of motor vehicles,
which had been hindered by capacity constraints.
Excluding motor vehicles and parts, industrial production rose 6.3 percent at an annual rate last
quarter, nearly the same as the pace of the first
quarter.
When analyzed by market group, the data show
that the production of consumer goods advanced
0.6 percent in June, mainly because of the large
rise in sales of electricity to residential users.
Among other consumer goods, the output of auto
2. Contains components in addition to those shown,
r Revised,
p Preliminary.
motive products eased a bit further, reflecting a
small decrease in car assemblies. The production of
other durable goods, such as appliances and furniture, increased about 1 percent, partially retracing
the May decline. On balance, the output of these
goods has changed little since last fall. The output
of nondurable goods other than energy products
was unchanged.
The production of business equipment excluding
cars and trucks rose 0.6 percent in June, after an
average monthly gain over the preceding three
months of almost 1 percent. The deceleration in
growth reflected, in part, strike-related losses in
construction and mining machinery. Even so, the
output of this sector advanced at an annual rate of
about 11 percent in the second quarter, only about
1 percentage point less than the growth rate for the
first quarter.
The output of construction supplies, which had
704
Federal Reserve Bulletin • August 1994
risen sharply in March and April, recently posted
small gains. The large rise in the production of
business supplies reflected the weather-related
increase in sales of electricity to commercial users.
Among non-energy materials, production rose
0.2 percent, about the same as the gains in each of
the two preceding months. Increases in the output
of basic metals and parts for equipment were
largely offset by decreases in the production of
paper materials and parts for consumer durable
goods.
When analyzed by industry group, the data show
that manufacturing production moved up 0.2 percent in June, about the same rate of increase as in
both May and April. Excluding motor vehicles and
parts, factory output rose 0.2 percent, down from
the 0.5 percent gains registered in May and April.
The slower rate of increase reflected mainly a softening in the output of nondurables, particularly
paper, apparel, and petroleum products; also contributing to the slower increase was the production
of chemicals, which had risen sharply in May but
was about unchanged last month. Despite the recent
slowing, the output of manufacturing excluding
motor vehicles and parts grew at an annual rate of
about IV2 percent in the second quarter, up from
the annual growth rate of 53A percent in the first
quarter.
Total factory utilization edged down again in
June, to 82.8 percent, as the operating rates for
both primary-processing and advanced-processing
industries declined slightly. The operating rates for
most major industries decreased; the only significant increases occurred in the furniture and instruments industries. Even though the overall factory
operating rate has eased a bit over the past two
months, the utilization rates for many industries,
including lumber, primary metals, textiles, petroleum products, and machinery, remain well above
their long-run averages. Moreover, the recent levels
of factory utilization for petroleum products and
machinery have been running above their previous
cyclical highs of the late 1980s.
Mining output declined 0.5 percent in June
owing to another large decrease in coal mining.
The output at utilities increased more than 5 percent, reflecting the effects of the severe weather on
electricity demand.
•
705
Statements to the Congress
Statement by Lawrence B. Lindsey, Member,
Board of Governors of the Federal Reserve System, before the Subcommittee on Consumer
Credit and Insurance of the Committee on Banking, Finance and Urban Affairs, U.S. House of
Representatives, June 9, 1994
I am pleased to appear on behalf of the Board of
Governors of the Federal Reserve System to
address issues related to consumer credit. I will
focus my prepared remarks on the questions you
raised in your letter of invitation.
Let me begin with some background. Two
months ago, the U.S. economy entered the
fourth year of its current expansion. Although
this expansion began on a sluggish note, economic growth has been appreciable, on average,
since early 1992. For example, real gross domestic product expanded 3.9 percent during 1992 and
3.1 percent during 1993. During the first quarter
of this year it rose at an annual rate of 3.0
percent, in line with the expectations of growth
for this year given in February by the members of
the Federal Open Market Committee.
This economic expansion has resulted in moderate, but still healthy, job gains and falling
unemployment. We can all be pleased with the
decline in the unemployment rate to 6.0 percent
in the latest survey by the Bureau of Labor
Statistics.
As is usually the case, changing spending
patterns in the household sector have been key to
the expansion. For example, in inflation-adjusted
terms, the increase in personal consumption expenditures has amounted to 71 percent of the
expansion in GDP since the recovery began in
the second quarter of 1991. If anything, the
importance of consumption has increased as the
recovery has progressed. Since the first quarter
of 1993, increased consumption has accounted
for 77 percent of the expansion in overall GDP.
By contrast, during the economic expansion
from 1982 to 1990, consumption growth was
responsible for just 68 percent of the growth in
GDP.
Investment in residential real estate showed a
similar trend. During the current expansion,
housing has accounted for 16.4 percent of the
growth in GDP. During the 1980s expansion,
increases in housing represented only 6.2 percent
of the increase in GDP. Combining these two
categories of household outlays, therefore,
shows the importance of the household in the
current expansion. The growth in personal consumption and housing investment constituted 87
percent of GDP growth since the expansion
began, compared with 74 percent during the
1980s. Thus, the questions you asked about the
financial health of the household sector and its
continued access to credit are particularly pertinent in today's economic environment.
As is usually the case in economic expansions,
higher levels of household debt have helped
finance increased activity. As policymakers, we
should recognize that households are the best
judges of their own financial circumstances, so
we should not view these increased levels of debt
as necessarily "good" or "bad." Increased levels of household income, more optimistic attitudes toward employment prospects, and generally favorable conditions for borrowing are all
contributing to the recently increased willingness
of households to take on debt.
The first question in your letter asked about
recent growth in consumer credit and how it
compares with past expansions. It is important to
consider the various types of consumer credit.
The Federal Reserve has just released its report
on consumer installment credit. In April, installment credit grew at a 13.2 percent annual rate
after a revised 12.6 percent rate in March,
slightly higher than the 11.2 percent growth during the fourth quarter of last year. It is certainly
well above the full-year growth of 6V2 percent in
1993 or growth of just 1 percent in 1992. Indeed,
the double-digit pace reached over the past half
706 Federal Reserve Bulletin • August 1994
year or so is the most rapid since the third
quarter of 1986.
Nevertheless, it is hard to determine conclusively how the current rate of credit expansion
compares to historical norms. Recall that we are
now in the fourth year of an economic upswing.
As the above data indicate, growth of installment
credit was quite subdued during the early portions of the current expansion. This makes qualitative comparisons of current growth with that
in comparable earlier time periods somewhat
problematic. The resurgence in consumer installment credit has come later than usual in the
current economic expansion, and the recent pace
has still been well below peak rates reached
during some earlier expansion periods.
Typically, installment credit starts to climb in
the first or second quarter of a recovery and is
generally rising quite sharply by the second year,
often reaching growth rates of 15 percent to 20
percent at some point in the cycle. In contrast,
during the most recent upturn in the economy,
installment credit continued to contract through
the fifth quarter of recovery; its growth rate did
not reach double digits until October 1993, two
and one-half years into the recovery. On the
other hand, the household sector entered this
expansion with a higher level of debt than it had
in the past, making comparison of percent increases difficult.
We should bear in mind that swings in growth
of consumer credit are wider than fluctuations in
the economy as a whole because consumer credit
is used most heavily to finance purchases of
durable goods, which are much more cyclical
than consumer income or total consumption.
Durable goods include autos and large consumer
appliances, which often move with home sales.
The strength in these two sectors has meant that
durables have been particularly important in the
present expansion, contributing 25 percent of
increased GDP, compared with just 16 percent
during the 1980s expansion.
The comparability of the data on credit growth
is also somewhat limited by the development of
alternative means of finance. Changes in consumer tastes, the marketing of financing alternatives, and the tax environment can all affect the
composition of consumer credit. For instance,
the phasing out of tax deductibility of interest
payments on nonmortgage consumer loans after
1986 has prompted some shift toward more use of
home equity credit and less of traditional consumer loans. The tailoring and promotion of auto
leasing to individual consumers have provided
them with another means of acquiring cars that
has considerable appeal for some types of consumers. I would not want to overstate the impact
of these alternatives—estimates made by the
Board staff indicate that shifts to these forms of
financing have trimmed 1 to 3 percentage points
off the growth rate of consumer installment credit
in recent years—but such considerations do
muddy the comparisons a bit.
A similar type of change in credit product that
makes comparison across business cycles difficult has been the development and spread of
general purpose credit cards for individual consumers during the past few decades. From less
than $10 billion in 1970, debt outstanding on bank
credit cards has grown to more than $200 billion
today. Revolving credit, including retail store
cards as well as bank cards, is now the largest
component of consumer credit, recently surpassing auto credit.
How this development affects consumer balance sheets is somewhat unclear. A considerable
amount of this revolving credit is commonly
called "convenience credit" because it is repaid
by consumers within an interest-free grace period. Whether one should view convenience
credit as debt in a true sense is open to question,
but the convenience credit that is on a creditor's
books on the last day of the month will be
included in our measure of consumer credit. The
contribution of convenience use to credit growth
takes on more importance these days as people
run more expenditures through their cards to
accumulate frequent-flier mileage or points toward purchase of an automobile. Overall credit
market conditions also affect the consumer's
choice of debt and make historical comparison
problematic. For example, efforts to trim debt
during the early 1990s and the early part of this
expansion were probably reinforced by historically wide spreads between the interest rates
consumers were paying on existing loans and the
interest rates they could earn on new financial
assets. In response to these wide spreads, some
people elected to pay down debts with maturing
Statements to the Congress
assets rather than roll them over at extremely
low yields. For example, a consumer with a
maturing certificate of deposit yielding 8 percent
might choose to pay off a 10 percent car loan with
the funds when new certificates of deposit yield
only 3 percent or 4 percent. In essence, these
spreads represent the cost of household liquidity,
and households elected to assume less liquid
positions, reducing levels of both debt and of
financial asset holdings as a result of this increased cost. Again, the lack of comparability of
these developments with other business cycles
makes an evaluation of consumer debt positions
difficult.
In sum, these factors seem to have come
together in recent months. The pattern of durable
goods consumption has turned stronger, providing a stimulus to the growth of installment credit.
Healthier consumer balance sheets, resulting
both from the earlier slowdown in growth of
mortgage and consumer debt and from substantially lower average interest rates on the stock of
debt, have probably made individuals feel more
comfortable about taking on debt again. In addition, heavy promotion of credit cards with rebates and other incentives tied to the volume of
transactions has apparently boosted growth in
this area.
As I have indicated, comparisons of growth
rates over time are complicated. Sifting through
all these considerations, I think it is fair to say
that the strength in consumer credit seen so far is
not out of line with historical patterns. We also
need to look at the ability of households to
support the debt. The stock of mortgage and
consumer debt relative to income is historically
high and has begun to rise a bit with the recent
rebound in debt growth after it had leveled off for
several quarters.
On the other hand, debt-servicing payments—
covering both interest and principal—relative to
income suggest a net decline in burden. Our
staff's estimate of the share of disposable income
allocated to scheduled principal and interest payments by the end of last year had fallen appreciably from the beginning of the decade. This
decline resulted from the slowdown in borrowing
as well as to lower borrowing costs, especially
those resulting from the surge in mortgage refinancing that accompanied declines in mortgage
707
rates to historically low levels. More recently, as
household debt growth has strengthened and
interest rates have turned up, debt service payments perhaps have edged up.
The prospective risks this might pose are probably best determined by direct measures of debt
payment performance. In this regard, delinquency rates on consumer and mortgage loans
have suggested for some months now that the
risks associated with debt burdens have diminished. According to both industry data from the
American Bankers Association (ABA) and calculations from bank call reports, consumer loan
delinquencies have been on the downswing since
at least early 1992.
The ABA series for all loans combined
dropped in the fourth quarter last year to its
lowest level since the first quarter of 1984. Similar evidence is provided by data on past-due
auto loans at the auto finance companies and on
past-due home mortgages reported by the Mortgage Bankers Association. Personal bankruptcies, although still historically quite high, have
also been declining in recent months.
Nonetheless, looking below these aggregate
statistics, there are reasons to believe that some
households have not made much progress in
relieving debt burdens. As I have remarked elsewhere, some evidence suggests that middle income households, who carry the bulk of household debt, may not have fully shared in recent
income growth and thus in the easing of the
aggregate debt-servicing burden.
Your second question dealt with the availability and affordability of consumer credit. Availability of credit—the relative willingness of creditors to make loans to consumers at specified
interest rates—has increased. For instance, responses to the Federal Reserve's Senior Loan
Officer Opinion Survey indicate that banks have
become progressively more willing to lend to
consumers since shortly after the end of the
recession in 1991. Major new credit card plans,
such as the joint ventures between card issuers
and the major auto manufacturers, have been
offered within the past two years.
Many factors can affect the availability of
consumer credit. Earlier in the decade, the balance sheet strains experienced by financial institutions resulting from heavy recession-related
708
Federal Reserve Bulletin • August 1994
loan losses and the need to meet stricter capital
requirements restrained the availability of consumer credit, just as they limited the supply of
other types of credit. The profitability of consumer lending remained relatively attractive,
however, and this type of lending was probably
curtailed less than some other types, such as
commercial real estate.
The development in recent years of a secondary market for consumer loans through securitization of auto loan and credit card receivables
has also been a net plus for credit availability to
consumers. Securitization has enabled banks and
other traditional lenders to households, such as
auto finance companies, to continue to originate
consumer loans even when they were unable to
profitably fund these credits themselves. This
has brought new lenders into the market as
indirect suppliers of credit, reducing the vulnerability of this source of credit to the occasional
difficulties of traditional lenders.
An important component of the affordability of
consumer credit is the interest rate charged on
consumer loans. As you know, these rates have
come down substantially. Auto loan rates at
banks averaged about 11 percent in 1991 but had
dropped to IVi percent on average by the first
quarter of this year. This rate is dramatically
lower than it has been historically. The previous
record low was 10 percent and occurred in 1972,
the year the series was begun. As a result, the
affordability of automobiles is historically high,
or, put another way, debt payments on a new car
relative to income are historically low.
With regard to revolving credit, our series on
credit card rates, which typically has shown very
little movement, dropped 2 percentage points
from its recent high in early 1991. However, our
credit card series may not fully take into account
the increased variety of terms that have emerged
in this area. Market segmentation has significantly complicated the analysis of effective credit
card rates. In all likelihood, the reduction in
effective rates to credit card holders is greater
than our survey would suggest.
The third question in your letter requires us to
look ahead. In my judgment, prospects for the
availability and affordability of consumer credit
are likely to remain quite favorable. Earlier this
year, members of the Federal Open Market Com
mittee anticipated further solid gains in output
and income in 1994, about 3 percent or so, a view
that appears to have been confirmed by the
evidence to date. Also, private forecasters continue to expect growth of about 3 percent this
year. In this context of continued economic
expansion, and given the stronger position of
banks and other lenders, mortgage and consumer
credit should generally be in ample supply. This
situation will be buttressed by the continued
development of active markets for securitized
mortgages and consumer receivables.
The final question in your letter raised questions about interest rates on consumer deposits
and whether they are unusually low in relation to
market rates by historical standards. Historical
comparisons of deposit rates can be tricky, in
part because retail deposit rates were subject to
interest rate ceilings before the 1980s. Financial
market deregulation and innovations during the
1980s have clearly brought tremendous gains to
savers, particularly those who rely on typical
consumer accounts.
Rate spreads have been affected by greater
regulatory costs imposed on banks and thrift
institutions in recent years, notably higher deposit insurance premiums. Still, the evidence
shows that rates on negotiable order of withdrawal (NOW) accounts, savings deposits, and
money market deposits have been very sticky.
They have been especially slow to respond to
upward movements in market interest rates, although they have also been sluggish in the downward direction. In 1991 and 1992, when market
rates of interest were coming down, rates on
these accounts dropped less rapidly, making
them quite attractive in relation to market instruments, such as Treasury bills. Rates on these
bank deposit accounts continued to fall last year
as they completed the adjustment to the earlier
declines in market rates. By contrast, these rates
currently appear to be sticky in an upward direction.
In part, this stickiness may reflect costs associated with changing such deposit rates. These
costs may be both of an internal administrative
nature and market based. Holders of these accounts seem to expect stability in rates and are
prone to close accounts and move balances elsewhere when deposit rates are cut. In recent
Statements to the Congress
709
years, when market rates declined to historically
low levels, bankers appeared reluctant to drop
rates on these liquid deposits and disturb their
long-term depositors in these accounts. During
earlier rising rate environments, rates on such
accounts lagged earlier upward movements in
market rates. Banks and thrift institutions had
been unwilling to raise rates on these accounts as
costs would have risen for all accounts, not just
new ones. Taking this historical pattern of stickiness into account, rates on these types of deposits do not appear to be noticeably out of line with
previous experience.
In the case of retail certificates of deposit
(CDs), rates have typically adjusted quite
promptly to movements in market interest rates.
Unlike the liquid accounts just discussed, adjusting the rate on such time deposits in keeping with
movements in market rates does not immediately
affect the whole cost structure of time deposits,
only the cost of new deposits and rollovers.
Rates on retail CDs, nonetheless, appear to have
been on the low side of historical norms over the
past year or so perhaps in part because loan
demand had been rather weak. In recent months,
however, loan demand has firmed, and rates on
retail CDs have been rising steadily as banks
have needed to raise funds.
In conclusion, the recent strengthening in
consumer credit can be viewed as another piece
of evidence that the economic expansion is
firmly in place. Credit to households appears to
be quite readily available, and many households, having completed substantial adjustments to alleviate debt-servicing strains, are
showing that they are again willing to borrow to
finance spending. Moreover, changes in our
financial system, notably the securitization of
mortgage and consumer debt, will better ensure
that credit supplies are not disrupted by the
financial difficulties of any segment of the financial services industry.
•
Statement by John P. LaWare, Member, Board
of Governors of the Federal Reserve System,
before the Subcommittee on Telecommunications and Finance of the Committee on Energy
and Commerce,U.S. House of Representatives,
June 14, 1994
mentation may prove helpful in encouraging the
development, through the securitization process,
of a secondary market for small business loans.
We also support the bill's approach of promoting
this development by relying on the private sector
rather than involving the government through yet
another guarantee program.
Small- and medium-sized businesses have always been of critical importance to the U.S.
economy. They have served as an engine for job
creation and as a major source of innovation in
product development. To continue to fulfill these
roles these businesses must have the ability to
obtain adequate credit accommodation. Traditionally, the commercial banking system has
been the principal source of credit to smaller
businesses, and the small business segment has
contributed importantly to the earnings of the
banking industry.
Unfortunately, during the latter part of the past
decade, and in the first year of this decade, as
banks encountered severe problems in their loan
portfolios, they generally tightened their lending
standards. As a result, the availability of credit
was significantly reduced, particularly to small
businesses. With its markedly improved perfor-
I am here today to discuss title II of the Community Development, Credit Enhancement, and Regulatory Improvement Act of 1994 (H.R.3474),
entitled Small Business Capital Formation, as
passed by the Senate on March 17, 1994. Title II
seeks to increase the availability of credit to small
businesses by facilitating the securitization of
small business loans. The objective of this bill is
extremely important, particularly given the problems that some small businesses have had in
obtaining adequate credit accommodation. Moreover, experience in other sectors of the credit
markets where securitization has become widespread suggests that securitization of small business loans could confer benefits on banks and
other financial institutions that originate, securitize, and invest in these loans.
Accordingly, the Federal Reserve supports the
objectives of title II. We believe that its imple
710
Federal Reserve Bulletin • August 1994
mance in the past two years, the banking system
has been able to strengthen its balance sheet and
is in a much better position to lend to small
businesses and other borrowers. Government
agencies have also taken a number of steps to
encourage banks to loan to small businesses,
including a program to allow banks to establish a
"basket" of loans that will be judged on the basis
of performance and not be criticized on the basis
of documentation deficiencies. Taking these developments into account along with the generally
improving economy, it is not surprising that the
volume of small business loans has been growing
since last fall.
Nonetheless, there may be many situations in
which creditworthy small businesses are continuing to encounter difficulties in obtaining credit.
Besides addressing the problem created by the
credit crunch of recent years, it is highly desirable to find ways to promote, in an efficient but
prudential manner, the flow of credit to smaller
businesses.
A possible way to maintain or increase small
businesses' access to credit could be the expansion of opportunities to securitize small business
loans. Although the approach is no panacea, it
has been given increased consideration in recent
years.
In a securitization, loans are placed in a pool
and securities are issued that entitle the holders
to the proceeds of the principal and interest
payments flowing from the underlying loans.
Originators of loans that are used in asset-backed
securities could benefit from improved liquidity,
enhanced fee income, and—to the extent that a
true sale has occurred and the assets are removed from their balance sheets—less need for
capital. Investors, on the other hand, acquire
securities that require no management of the
underlying loans on their part and yet provide an
attractive return for instruments that pose, depending upon the nature of the credit enhancement, little or no credit risk.
For the securitization of assets to be successful, the resulting security must be appealing to
investors, who are generally risk averse. When
evaluating securities, investors rely heavily on
the national credit-rating agencies to inform them
of the credit risk associated with securities
through the assigned credit ratings. Thus, secu
ritized transactions must have sufficient credit
enhancement to obtain a credit-rating level that
makes the securities attractive to investors.
Both sales and purchases of securitized pools
offer improved diversification and a greater selection of risk and return alternatives. Purchases
of securities backed by loans may be particularly
valuable to smaller banks that do not have the
capability of diversifying their lending either geographically or according to industrial sector.
Given the potential benefits to be gained from
the securitization of small business loans and
business loans generally, the Federal Reserve
believes that it is important to give careful consideration to proposals designed to promote and
encourage the securitization of such loans. These
potential benefits have been dramatically demonstrated by the impressive growth in the residential mortgage-backed securities market and the
markets for securities based on auto loans and
other consumer loans. It thus seems reasonable
that small business lending could also benefit
from securitization.
Small business loans, however, differ substantially from the types of loans—such as residential
mortgages, auto loans, and credit card receivables—that are currently securitized. Although
these types of loans are relatively homogeneous,
small business loans tend to be quite heterogeneous, in part because of the natural diversity of
small business enterprises and their loan terms,
which are usually individually negotiated to suit
the unique credit needs of each borrower. This
diversity results in loans with widely different
maturities and repayment terms, different degrees of documentation, and different amounts of
information regarding the underlying financial
positions of the obligors. This heterogeneity
greatly complicates the process of predicting the
future cash flows produced by pools of even the
highest credit quality.
Also, pools of small business loans may exhibit
a diversity in credit quality, which, coupled with
a diversity in documentation standards, greatly
complicates the task of performing due diligence
and reaching a judgment as to the overall quality
of the pool. Finally, the lack of a sufficiently
broad and deep historical database on small
business loan performance makes actuarial methods of estimating loan losses extremely difficult.
Statements to the Congress
All these barriers to successful widespread
securitization of small business loans derive from
the heterogeneity of this type of credit. The
heterogeneity problem could be solved through a
more standardized loan product that could be
easier to securitize. Standardization, however,
would introduce an element of inflexibility into
small business lending and could preclude many
small business firms from obtaining the credit
accommodation they need because they do not fit
the "mold." In addition, the standardization of
small business loans could increase the amount
of documentation needed to support such credits, thereby increasing the cost to small business
borrowers.
In this regard, it should be noted that the
securitization of residential mortgages has resulted in much more elaborate and expensive
documentation requirements. Thus, it is possible
that rigid and inflexible underwriting standards
and increased documentation requirements could
actually curtail the amount of available credit for
businesses.
Because greater homogeneity of small business loans has not been achieved, the successful
securitization of such assets has had to rely on
significant credit enhancements. Such large enhancements are needed to offset the concerns of
risk-averse investors over the uncertainty associated with the heterogeneous nature of small
business loans.
The provision of credit enhancements by
banks to facilitate the securitization of these
loans is certainly not an objectionable activity, so
long as it is carried out in a safe and sound
manner and adequate capital support is maintained to protect depositors. In this connection,
it should be noted that the heterogeneous nature
of small business loans makes it relatively difficult for banks to accurately assess the riskiness
of providing credit enhancements for these transactions. Thus, it becomes especially important to
ensure that banks maintain adequate capital for
such arrangements, including sales of assets with
recourse.
Under a recourse arrangement, a bank typically commits to cover any initial losses on loans
that may occur up to a contractually agreed upon
amount. This arrangement results in the selling
bank being exposed to a possibly significant
711
proportion of the potential losses on the transferred loans.
Under generally accepted accounting principles (GAAP)—or more specifically Financial Accounting Standard 77 (FAS 77)—which the bill
proposes to utilize, a bank may remove from its
balance sheet an asset sold with recourse even if
it has retained the risk of ownership. This accounting standard treats the transfer of assets
with recourse as a sale if the seller relinquishes
the benefits of owning the asset, is reasonably
able to estimate the expected losses to which it is
still exposed under the recourse provision, and
establishes a specific liability reserve equal to the
amount of these expected losses. This treatment
generates a strong incentive for banks to underestimate losses, and this weakness has caused
some accounting professionals to criticize FAS
77. Even if loss estimates were made in good
faith, however, this approach would still be of
concern from a supervisory perspective because
it does not take into account the possibility that
actual losses may turn out to be substantially
greater than expected losses. The role of capital
is to serve as a buffer against such developments,
and GAAP is silent on this aspect of risk exposure.
The banking agencies' rules attempt to establish policies to ensure that government-insured
depository institutions will hold capital commensurate with their risk exposure in any transactions—including securitized transactions—that
they engage in. Thus, unlike GAAP, the regulatory treatment of asset sales focuses on the
retention of risk rather than the relinquishing of
the benefits of ownership. Under this treatment,
when a loan is transferred with recourse, the
agencies have generally treated the transaction
as a borrowing and have required the transferor
to maintain capital against the entire amount of
the assets transferred.
More recently, however, it has come to be
recognized that this conservative approach does
not fully take into account contractual limitations
on the selling bank's recourse obligation and may
not accurately reflect expectations or practices of
the marketplace. In this regard, the agencies,
under the auspices of the Federal Financial Institutions Examination Council, have reviewed
long-standing recourse rules. They have con-
712
Federal Reserve Bulletin • August 1994
eluded that these rules should be modified to
reduce the capital charges for certain asset sales
with limited recourse to make those charges
more commensurate with the contractual credit
risk to which the selling organization is exposed.
Accordingly, on May 25, 1994, the federal
banking agencies published for public comment a
detailed proposal on the appropriate capital treatment for recourse arrangements. The proposed
guidelines are consistent with the basic supervisory principle that the capital held against transactions should be commensurate with their risk.
In particular, the agencies are proposing to reduce the capital requirement for all recourse
transactions when the selling banking organization contractually limits its exposure to less than
the full, effective risk-based capital requirement
for the assets transferred. This low-level recourse rule would apply to all types of assets,
including small business loans and commercial
loans. For example, the risk-based capital requirement for a standard risk asset transferred
with a 3 percent recourse obligation would be
only 3 percent rather than the currently required
8 percent.
In addition, the agencies are requesting public
comment on a preliminary proposal that would
employ credit ratings to assess risk-based capital
against banking organizations' securitization exposure based on their relative risk of loss from
the underlying assets. This aspect of the agencies' proposal could reduce the capital requirement against senior asset-backed securities that
currently are assessed 8 percent capital. Although the existing regulatory guidance needs
some revision, its limitations have not precluded
the development of substantial securitization
markets for a wide variety of loans.
In this regard, in the House version of
H.R.3474, section 138 calls for federal banking
agencies to review the capital standards applicable to loans sold with recourse and revise their
capital standards in accordance with the agencies' findings. The banking agencies are already
conducting such a review and, as mentioned
earlier, recently published proposals to revise
their capital rules with regard to recourse arrangements as a part of that review. Thus, it
would seem that legislative action calling for
such a study is not necessary.
Section 138 also mandates that any revisions
that the agencies propose to their capital standards may not be less stringent than GAAP. This
explicitly ties the banking agencies' regulatory
capital rules to GAAP. The capital rules are not
an accounting principle; they are a supervisory
tool to help ensure the safety and soundness of
the banking system. On the other hand,
GAAP—as set by the Financial Accounting Standards Board (FASB), a private standard-setting
group—is oriented toward the disclosure of information for stockholders, investors, and analysts, which may or may not be relevant for
safety and soundness purposes.
Given the divergent purposes of the regulatory
capital rules and GAAP, we believe that the
banking regulators should have the authority to
differ from GAAP when necessary to address
safety and soundness concerns without being
constrained by a stringency test relative to standards set by a private group like FASB. The
section 138 stringency test is similar to the one
set forth in section 121 of the Federal Deposit
Insurance Corporation Improvement Act
(FDICIA) with respect to accounting standards
that banking organizations must use in completing regulatory reports, and both cause concern.
Section 138 of the House version of H.R.3474
would effectively give FASB more authority over
the agencies' regulatory capital rules than the
regulators themselves would have—-just as section 121 of FDICIA has given FASB more authority than the agencies have over regulatory
reporting requirements—since in both cases any
differences from GAAP would have to be justified as "no less stringent." This concerns us
because safety and soundness considerations
may dictate an approach to regulatory capital
rules and regulatory reporting that is very different from what GAAP requires, and, thus, a
stringency test may not be applicable. As a
result, the banking regulators may be forced to
follow GAAP in cases in which that is not the
prudential course of action from a safety and
soundness viewpoint, simply because that course
of action is so different that a stringency test
cannot be applied.
Accordingly, section 138 of the House version
of H.R.3474 should be either dropped or revised
to decouple the agencies' regulatory capital rules
Statements to the Congress
from GAAP. Further, we would propose that the
Congress also amend section 121 of FDICIA so
that the agencies' regulatory reports can follow
GAAP to the extent consistent with safety and
soundness.
Now I would like to turn to the specifics of
section 208 of title II, which deals with the
accounting, capital, and reserve requirements for
transfers of small business loans. In particular,
with respect to capital, section 208 contains two
principal provisions. First, small business loans
sold with recourse would be reported in accordance with GAAP on the regulatory reports filed
by insured depository institutions. Second, the
maximum amount of capital and reserves to be
maintained by insured depository institutions
selling small business loans with recourse would
be limited to a specific reserve equal to the selling
institution's reasonable estimate of its liability
under the recourse arrangement, plus an 8 percent capital requirement against the amount of
retained recourse.
As I have noted, one of the most important
safety and soundness considerations is the
amount of capital that is maintained to protect
banking organizations from any risks associated
with loan securitization. In our view, the capital
provision outlined in section 208 of title II accords quite preferential treatment to the securitization of small business loans. If that treatment
were to be extended to small business loan
securitizations without imposing limitations, it
would raise safety and soundness concerns. The
bill incorporates some limitations, however, that
help somewhat to mitigate these safety and
soundness concerns. First, the preferential capital treatment would be restricted to those institutions that, under the agencies' current riskbased capital standards, are either well
capitalized or are adequately capitalized and
have the approval of their primary regulator.
Second, the aggregate of the maximum contractual recourse obligations on all such loans "sold"
may not exceed 15 percent of a bank's total
risk-based capital.
Although we do not believe that the approach
specified in title II is the best way to manage this
activity, we did not object to the approach or
believe that it would unduly threaten safety and
soundness so long as these limitations were in
713
place and the preferential capital treatment was
limited to small business loans. We are concerned, however, that establishing a special capital treatment for small business loans would set
a troubling precedent for other types of loans and
that the extension of the liberal treatment beyond
small business loans could raise safety and
soundness concerns.
As I mentioned earlier, the banking agencies
have issued specific proposals to revise our
capital standards for securitizations and other
recourse arrangements. We believe that rather
than specifying detailed capital requirements
for a select group of assets by statute, it would
be preferable for the Congress to revise this
legislation to support the agencies' efforts to
develop appropriate capital standards for securitizing all types of loans. This would enable the
agencies to address small business loan securitization in a manner that would be consistent
with the maintenance of a safe and sound
banking system. It would also avoid the rigidities that result when technical and complex
regulatory requirements are written into law.
The agencies need flexibility to be able to adjust
the rules to account for changes that occur in
the marketplace.
In view of the importance of credit availability
to small- and medium-sized businesses, we are
committed to continuing to work with this committee, the other banking agencies, and the Administration in developing an approach that will
remove any unnecessary impediments to securitization, while at the same time protecting the
safety and soundness of the banking system and
minimizing regulatory burden.
In our view, the capital provisions outlined in
section 208 of title II would not, by themselves,
provide adequate protection to banks involved in
securitization of small business loans. For example, to encourage the securitization of small
business loans, section 208 of title II would give
designated institutions permission to maintain
capital against risk exposure arising from the sale
of small business loans with first loss recourse in
an amount that is less than is required under the
banking agencies' existing or proposed capital
standards.
The Congress now has before it several other
bills that would extend this preferential capital
714
Federal Reserve Bulletin • August 1994
treatment to a wide variety of assets that are
even more difficult to securitize than small business loans. We believe that such an expansion
would be unwise. Most certainly, lending that
would be subject to liberal capital terms should
not be expanded beyond the constraints that
have been specified. That being the case, to the
extent other types of loans are made eligible for
such treatment, that would require a reduction in
the amount of small business loans that could be
sold under the liberal capital terms. Moreover, to
widen the list of eligible loans would serve to
complicate an already complex capital standard.
And such an extension is almost certain to be
perceived as a major departure from the established internationally accepted capital principles,
on which the U.S. banking agencies have based
their risk-based capital rules.
•
Statement by Alan Greenspan, Chairman, Board
of Governors of the Federal Reserve System,
before the Committee on the Budget, U.S.
House of Representatives, June 22, 1994
Reserve and to outside analysts. Indeed, in testimony to the Congress at that time I mentioned
that, with short-term real rates not far from zero,
"market participants anticipate that short-term
real interest rates will have to rise as the headwinds diminish if substantial inflationary imbalances are to be avoided." But lingering questions
into the second half of 1993 about whether the
economy had fully recuperated made the appropriate timing of such action unclear.
Since the latter part of 1993, however, the
expansionary effects of the monetary policy of
the past few years, along with the healing of
balance sheets, have become increasingly apparent. Given the stronger economic and financial
conditions, it became evident by early 1994 that
the mission of monetary policy of the past few
years had been accomplished. The "headwinds"
were substantially reduced, and the expansion
appeared solid and self-sustaining.
Having met our objective, there seemed no
reasonable purpose in maintaining the demonstrably stimulative level of short-term interest
rates held throughout 1993. Maintenance of that
degree of accommodation, history shows, would
have posed an unacceptable risk of mounting
inflationary pressures. Given the resumption of
more normal patterns of economic activity and
credit flows, a shift in policy stance was clearly
indicated.
In early February, we initiated the process of
withdrawing the degree of monetary stimulus. At
the time, we thought long-term rates would move
a little higher temporarily as we tightened, but
that anticipation was in the context of expectations of a more moderate pace of economic
activity both here and abroad than that which
emerged shortly thereafter. The subsequent dra-
I appreciate the opportunity to appear before you
to discuss recent monetary policy actions and
issues related to inflation.
The Federal Reserve's moves to increase
short-term interest rates this year are most appropriately understood in a historical context.
In spring 1989, we began to ease monetary
conditions as we observed the consequence of
balance sheet strains resulting from increased
debt, along with significant weakness in the collateral underlying that debt. Households and
businesses became much more reluctant to borrow and spend, and lenders to extend credit—a
phenomenon often referred to as the "credit
crunch." In an endeavor to defuse these financial
strains, we moved short-term rates lower in a
long series of steps that ended in late summer
1992, and we held them at unusually low levels
through the end of 1993—both absolutely and,
importantly, relative to inflation. These actions,
together with those to reduce federal budget
deficits, facilitated a significant decline in longterm rates as well.
Lower interest rates fostered a dramatic improvement in the financial condition of borrowers and lenders. The sharp, sustained decline in
debt-service charges and the restructuring of
balance sheets alleviated the financial distress,
enabling the economy to begin to move again in
a normal expansionary pattern. By last summer,
the likelihood that the economy would soon
respond more vigorously to these financial developments was already evident both to the Federal
Statements to the Congress
matic rise in market expectations of economic
growth here and abroad and associated concerns
about inflation provided considerable impetus to
the sharp jump in rates. Given the changes in
economic conditions and prospects, and the market's perception of them, longer-term rates
would eventually have increased significantly
even had the Federal Reserve done nothing this
year.
The rise in long-term rates has reflected increased uncertainty, as well as expectations of a
stronger economy. Although it was generally
expected, the move from accommodation, interacting with the news on the domestic and global
economy, triggered a reexamination by investors
of their overly sanguine assumptions about price
risk in longer-term financial assets. As volatility
and uncertainty increased, investors here and
abroad began to reverse their previous maturity
extensions. They fled toward more price-certain
investments at the short end of the yield curve.
For example, some flows into bond mutual funds
were reversed; investors, fearing further rate
increases and awakening to the nature of the risk
they had taken on, shifted funds back into shorterterm money market mutual funds and into deposits. The sales of securities by bond mutual funds
likely contributed to pressures on yields, especially in markets in which they had been important buyers.
Because we at the Federal Reserve were concerned about sharp reactions in markets that had
grown accustomed to an unsustainable combination of high returns and low volatility, we chose
a cautious approach to our policy actions, moving by small amounts at first. Members of the
Federal Open Market Committee agreed that
excess monetary accommodation had to be eliminated expeditiously. We recognized, however,
that our shift could impart uncertainty to financial markets, and many of us were concerned
that a large immediate move in rates would
create too big a dose of uncertainty, which could
destabilize the financial system, indirectly affecting the real economy. In light of the substantial
variations in prices of financial assets over the
past few months as we adjusted our posture, our
worries seem to have been justified. But, through
this period, many of those who had purchased
long-term securities with unduly optimistic ex-
715
pectations about the level and fluctuations in
yields had made the needed adjustments. Thus,
we judged at our May 17 meeting that we could
initiate a larger adjustment, without an undue
adverse market reaction. Indeed, markets reacted quite positively, on balance, at that time,
perhaps because they saw such timely action as
reducing the degree and frequency of tightening
that might be needed in the future.
Some critics of our latest policy actions have
noted that we tightened policy even though
inflation had not picked up. That observation is
accurate, but it is not relevant to policy decisions. To be successful, we must implement the
necessary monetary policy adjustments well in
advance of the potential emergence of inflationary pressures, so as to forestall their actual
occurrence. Shifts in the stance of monetary
policy influence the economy and inflation with
a considerable lag, as long as a year or more.
The challenge of monetary policy is to interpret
current data on the economy and financial markets with an eye to anticipating future inflationary or contractionary forces and to countering
them by taking action in advance. Indeed, if we
are successful in our current endeavors, there
will not be an increase in overall inflation. The
trends toward price stability will be extended in
the context of sustainable growth in economic
activity.
You raised a number of questions that relate to
the issue of resource restraints and their influence on inflationary pressures. These relationships are not simple. High levels of resource
utilization can contribute to the process that
ultimately produces destabilizing inflation, but
they need not do so.
Indeed, through much of this nation's history,
we had periods of tightened labor and product
markets with only transitory effects on the general price level. In these periods the discipline on
credit expansion provided by the gold standard
or other institutional arrangements limited the
potential for prices to spiral upward and thus
kept long-term inflation expectations from rising.
After World War II, however, with those disciplines no longer in place, tightened markets
became increasingly associated with rising inflation expectations and burgeoning credit demands, which we were sometimes too slow to
716
Federal Reserve Bulletin • August 1994
counter. A persistent inflation, unprecedented in
our history, eventually took hold, with devastating effects on our economy and society.
We are still paying a price for that episode
despite major successes in reversing inflationary
pressures during the past fifteen years. There
remains a significant inflation premium embodied
in long-term interest rates, reflecting a still skeptical world financial market view that U.S. fiscal
and monetary policies retain some inflation bias.
Until the late 1970s, the markets held a deepseated though, in retrospect, naive view that the
economic and institutional structure of the
United States rendered us particularly immune
from persistent inflationary forces. When that
view was shattered by the reality of the late
1970s, bond markets collapsed. Much progress
has been made in restoring the degree of confidence that existed earlier in the post-World War
II period, but it has taken years. Moreover,
judging from the remaining inflation premium
embodied in long-term rates, the job is not yet
complete. Having paid so large a price in reversing inflation processes to date, it is crucial that
we do not allow them to re-emerge.
With respect to your question about the socalled "natural rate" of unemployment, some
analysts have suggested that unemployment relative to its natural rate can be used as a means of
quantifying the aggregate demand-aggregate supply balance. The "natural rate" is usually defined as the rate of unemployment consistent
with no tendency for the inflation rate to move up
or down over time. Any attempt by either monetary or fiscal policy to hold the unemployment
rate permanently below the "natural" rate, it is
argued, would require increasing amounts of
monetary accommodation that, in the end, would
only succeed in pushing inflation continually
upward. The record of the postwar period suggests that episodes of tightness in the labor
market have been associated with increases in
the rate of inflation, and the converse. But over
the longer term, no trade-off is evident between
inflation and unemployment.
Although the idea of a national "threshold" at
which short-term inflation rises or falls is statistically appealing, it is very difficult in practice to
arrive at useful estimates that would identify
such a natural rate. In large measure, these
difficulties result from the enormous complexity
and dynamism of our labor markets. Evolving
demographic trends and changes in the geographical distribution of activity can alter the degree of
short-term pressure on wages that is associated
with any given measure of aggregate unemployment. Moreover, structural shifts in the pattern
of demand across industries and occupations can
also influence the so-called natural rate. In addition to the continual flux that is an integral
element of our market economy, public policies—intentionally or unintentionally—can raise
or lower the natural rate depending on whether
they hinder or facilitate adjustment in labor markets. Arriving at an overall assessment of these
influences is far from straightforward and likely
accounts for the wide range of estimates among
professional economists. When the statistical uncertainty associated with these estimates is taken
into account, a plausible "confidence interval" is
likely even wider.
At present, assessments of the state of the
labor market have been complicated by the revision this year to the Current Population Survey.
Based on initial tests of the new questionnaire
and collection techniques by the Bureau of Labor
Statistics, it appeared that the changes would
likely raise our statistical measure of the unemployment rate. In response, many analysts have
increased their estimates of the natural rate by
the presumed difference between the old and new
surveys. But a variety of technical issues remain
unresolved, and it may be a long time before we
know with any certainty the influence of these
changes on the measured unemployment rate.
In light of these uncertainties, I do not think
that any one estimate of the natural rate is useful
in the formulation of monetary policy. We clearly
have entered a period in which economic policymakers need to watch carefully for signs of
resource pressures in the labor market. But appropriate analysis of current and prospective
conditions will need to extend beyond the aggregate figures for the labor market alone and address regional and skill differences as they apply
to wage determination.
In addition to labor, the answers to your
questions about our capacity for noninflationary
growth will depend on the expansion of the
nation's stock of plant and equipment and, most
Statements to the Congress
important, ideas. Investment spending not only
raises the amount of capital per worker—an
essential determinant of labor productivity—but
also is a principal channel through which new
technologies are introduced into the production
process. Today we are in the midst of a capital
spending boom, as companies strive to modernize existing plants and add capacity. Investment
in computers and high tech communications
equipment has been particularly strong, stimulated by waves of technological improvement
and rapidly expanding opportunities for the application of these technologies. But demand for
more traditional types of industrial machinery
has also been strong, and the construction of new
production facilities has revived. This strength in
capital spending has been driven by the relatively
low level offinancingcosts and by the conviction
within the business community that, with favorable prospects for a steady expansion of the
economy, the risks in adding capacity are acceptable.
The Federal Reserve's own index of output
capacity in manufacturing increased 2XA percent
last year and is likely to surpass that performance
in 1994. The Federal Reserve's indexes define
capacity as the highest level of output that a plant
can maintain within the framework of a realistic
work schedule, that is, one that allows for normal
downtime and sufficient availability of inputs.
The Federal Reserve's capacity estimates are
developed from various sources, including capacity measures in physical units compiled by
trade associations, as well as surveys of utilization rates as perceived by individual companies.
But businesses have the ability over time to
respond to changing market conditions. When
demand is picking up, firms have historically
been able to "stretch" capacity by working their
capital and labor overtime. The ability to import
raw materials, components, or even final products from assembly plants abroad can also help at
times to meet unexpected growth in demand.
However, this solution is unlikely to be permanent because increased demand pressures abroad
as global activity recovers and expands will tend
over time to push up import prices and eliminate
any temporary cost advantage. At this point, we
have little aggregate evidence that the increased
openness of the U.S. economy over the past
40
several decades has substantially altered the process of domestic price formation.
The rate of capacity utilization in manufacturing—a measure of the pressure on the domestic production of goods—was a shade under 83
percent in May—well above its historical average. However, as with the unemployment rate,
there is no clear-cut "trigger point" for capacity
utilization as a signal for emerging inflationary
pressures. To be sure, as capacity utilization
increases, bottlenecks occur with greater frequency, and production costs rise. Indeed, the
recentfirmingof prices of some products and raw
materials suggests that we may already be witnessing some elements of this process. To date,
however, because of constrained increases in
unit labor costs, broad measures of producer
prices forfinalgoods have not generally reflected
the increases in those input costs. In addition,
monetary and credit growth remains quite
muted. But, further increases in pressure on
manufacturing facilities might suggest a greater
risk of emerging inflationary imbalances.
Of course, aggregate price trends obscure considerable diversity across industries in the relationship of capacity utilization to prices. For
example, operating rates are high in the motor
vehicle and computer-related industries. Yet the
prices of light trucks have risen, while the prices
of microprocessors have plunged. Such differences make it very difficult at the aggregate level
to pin down a particular level of capacity utilization that can be associated with the emergence of
inflation pressures. All told, the rate of capacity
utilization in manufacturing is not a foolproof
measure of inflation pressures. But, like the
unemployment rate, its level and trajectory deserve close attention.
The efficiency with which our labor and capital
resources are combined also has an important
influence on the aggregate supply potential of the
economy, and the recent record here is cause for
some optimism. Since the last business cycle
peak in summer 1990, labor productivity—output
per hour in the nonfarm business sector—has
increased, on average, at about a 2 percent
annual rate. At this stage, disentangling trend
from cycle remains difficult. But there are some
signs of improvement in our underlying productivity performance in response to increased
718
Federal Reserve Bulletin • August 1994
global and domestic competition and improved
management. In addition, the investment in high
tech equipment now finally appears to be paying
off. It has taken businesses time to learn how to
use computers effectively in their operations. But
better hardware and significant advances in software are now permitting many companies to
"re-engineer" the way they produce and distribute goods and services.
It is important to remember that growth in
productivity is the key to increases in our standard of living over time. Productivity is the
essential element that allows wages to grow in a
noninflationary way. It is for this reason that
over long periods of time broad measures of
compensation per hour, which include both
wages and benefits, closely track the trend in
labor productivity, when compensation is measured relative to the prices of the goods and
services produced in the U.S. economy. Thus, if
maintained, the strong growth in labor productivity in this expansion will be a very welcome
development indeed.
Finally, it is germane to ask what economic
policymakers can do to foster faster growth of
aggregate supply and thereby raise the threshold
of resource utilization. In this regard, the role of
monetary policy is rather narrow but potentially
potent. Most important, we can reinforce ongoing trends in the private sector that enhance our
productive potential by helping to create a stable
environment for sustainable noninflationary economic growth. Stability in economic conditions
boosts confidence and makes long-range planning by businesses and households much easier.
In that regard, the maintenance of inflation sufficiently low that it need not be a factor in
business and consumer decisionmaking enhances
the operation of the market price mechanism and
helps to ensure that resources are used most
productively. Inflation interferes with such price
signals and spawns the wasteful use of resources
to hedge against unexpected price changes.
Experience both here and abroad suggests that
lower levels of inflation are conducive to the
achievement of greater productivity and efficiency and, therefore, higher standards of living.
In fact, there is some, but by no means definitive,
evidence that lower rates of inflation have been
associated not just with higher levels of produc-
tivity but with faster growth of productivity as
well. Because of the increasing evidence of the
deleterious effects of inflation in recent years,
there has emerged a growing consensus throughout the world that a monetary policy geared
toward the pursuit of price stability over time is
the central bank's most significant contribution
to achieving maximal growth of a nation's wellbeing.
The actions undertaken by the Congress can
also have profound effects on the inflation threshold of our economy and its productive potential.
Clearly, we ought to be encouraging measures to
increase the flexibility of our work force and
labor markets. Improving education and facilitating better and more rapid matching of workers
with jobs are essential elements in making more
effective use of the U.S. labor force. Just as
important, the Congress should avoid enacting
policies that create impediments to the efficient
movement of individuals across regions, industries, and occupations, or that unduly discourage
the hiring of those seeking work. Competitive
markets have shown a remarkable ability to
create rising standards of living when left free to
function.
Finally, the Congress and the Administration
can continue to contribute to the growth of our
economy by maintaining a disciplined fiscal policy. Last year's budget agreement, especially the
spending caps, was a significant step in putting
fiscal policy on a more sustainable long-run path.
But, as this committee fully understands, under
current policy and law, later in this decade
federal outlays will almost surely again be rising
at a pace that will exceed the growth of our tax
base. Unless addressed, these trends will lead to
increases in the deficit as a percent of gross
domestic product, with unacceptable consequences for financial stability and economic
growth. As I indicated to this committee last
year, increases in tax rates cannot solve this
problem. Only by reducing the growth in spending will ultimate balance be achievable.
In summary, despite these considerable policy
challenges and the always-present future uncertainties, the outlook for the U.S. economy is as
bright as it has been in decades. Economic
activity has strengthened, unemployment is
down, and price trends have remained subdued.
Statements to the Congress
719
In addition, unlike some earlier periods, business
spending on new plant and equipment has been
an important contributor to growth. This strength
in investment will enhance economic efficiency
and lay the foundation for the productivity gains
that will bolster the economic welfare of our
nation. The Federal Reserve welcomes these
developments because the intent of our monetary
policy in recent years has been to foster precisely
this kind of healthy economic performance. •
Statement by Susan M. Phillips, Member, Board
of Governors of the Federal Reserve System,
before the Subcommittee on Consumer Credit
and Insurance of the Committee on Banking,
Finance and Urban Affairs, U.S. House of Representatives, June 22, 1994
tion of increased fees was also observed, with
twenty-four out of forty-four estimated fee
changes representing fee increases greater than
the rate of inflation and the remainder representing either increases less than the rate of inflation
or, in a few cases, fee decreases. These observed
changes in fees are similar to those found and
reported in earlier years.
Deposit insurance premiums have increased
over the years, so that these fee increases do
correspond with an increase in deposit insurance
premiums. It is, however, difficult to determine
with any certainty the extent to which the increase in deposit insurance premiums caused
fees to increase because changes in other factors
could also have played a role.
The survey data were obtained through telephone interviews conducted by a private survey
organization under contract with the Board. The
number of institutions surveyed each year has
been approximately 150 banks and 180 savings
associations, with some minor changes from one
year to the next. These institutions are chosen
randomly each year from each of seven different
geographical regions of the nation and from five
different size groupings. The results reported in
tables 1 through 4 are not simply averages of the
fees and service availability observed for the
sampled institutions.1 Instead, they are weighted
averages in which the weights are determined by
the region of the country and the size classification from which each institution is drawn. This
procedure is analogous to that typically used in
public opinion polling. The result in this case, we
believe, is a better estimate of what is true of the
entire population of banks and savings associations.
I am pleased to be here today to discuss the
trends in retail fees and the availability of retail
services at depository institutions. The information that I will describe today was obtained from
annual surveys sponsored by the Federal Reserve System.
Before presenting the results, let me first note
the original purpose of the surveys and explain
how they are conducted. The Board instituted
this effort to meet the requirements of section
1002 of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA).
The Congress required that the Board report
annually on discernible changes in the cost and
availability of a wide variety of retail banking
services to assess the extent to which increased
deposit insurance premiums might be passed on
to retail customers in the form of reduced availability of services or increased service fees. The
Congress further specified that these annual reports be based on annual surveys that use samples of insured depository institutions that are
representative in terms of size and location.
Surveys meeting these requirements have been
conducted for each of the past five years. Copies
of all the resulting reports to the Congress, which
contain substantially more information than I will
have time to present today, have been made
available to the committee.
The most recent of these reports found that the
availability of the majority of retail services
examined did not change appreciably between
1992 and 1993, with the few instances of improved availability outnumbering those of reduced availability. A general trend in the direc-
1. The attachments to this statement are available from
Publications Services, Board of Governors of the Federal
Reserve System, Washington, DC 20551.
720
Federal Reserve Bulletin • August 1994
In assessing observed changes from one year
to the next, it is important to note that institutions surveyed were not, in general, the same in
each of the years covered. In addition, changes
observed from one year to the next may reflect
differences in the sample drawn, as well as in the
true trend over time. This problem tends to be
more severe in the case of data items for which
few financial institutions are observed. If, for
example, only 10 percent of financial institutions
offer a particular retail service, few observations
of financial institutions in the sample can be used
to estimate the average fee for that service, and
the sampling error will be large. In general,
however, we think that this problem is insignificant for most of the items of interest.
SER VICE A VAIL ABILITY
Table 1 focuses solely on the issue of service
availability and how it has changed over time.
Service availability can be measured in a number
of different ways. For the purpose of this table, it
is measured as the percentage of banks or savings associations that offer a particular service.
Estimated percentages are presented for each
year from 1989 to 1993, and results are reported
separately for banks and savings associations.
The table also indicates the change in the percentages that occurred between 1989 and 1993
for both banks and savings associations. The
services included in the table are some of the
most important retail services offered by depository institutions. These services include noninterest checking accounts, negotiable orders of
withdrawal (NOW) accounts, which are basically
checking accounts that pay interest, savings accounts, money orders or cashiers checks (which
are aggregated because they are substitutes for
each other), and automated teller machine
(ATM) services. Because of the importance of
assessing the availability of basic banking services, we have also included information on the
percentages of institutions that offer those types
of noninterest checking accounts, NOW accounts, and savings accounts that carry no fee.
In assessing the trends in service availability, it
is clear that results differ from one type of service
to another. As a generalization, we do not find
strong evidence of an overall reduction in the
availability of services during this period. Indeed, the availability of some services (including
NOW accounts and ATM services at banks and
noninterest checking at savings associations) increased dramatically over the period.
The availability of no-fee accounts at banks
and savings associations is limited for all of the
years examined. For example, only about 8 percent of the banks and 12 percent of savings
associations offered no-fee noninterest checking
in 1993, and only 11 percent of banks and 1.5
percent of savings associations offered no-fee
savings accounts. Although no-fee noninterest
checking was still at a relatively low level of
availability, it became somewhat more available
at both types of institutions over the period.
However, no-fee NOW and savings accounts
became less available at both banks and savings
associations, with the availability of no-fee savings accounts dropping particularly sharply at
savings associations. Finally, the availability of
ATM services at banks has continued to increase
in recent years, although estimates of the availability at savings associations over the period
exhibit a volatile pattern.
SERVICE
FEES
Tables 2, 3, and 4 focus directly on the level of
fees charged by banks and savings associations
for various services and how the fees have
changed over time. We have divided the presentation of this information into three different
categories: information on the average level of
fees required to maintain and use various types
of checkable accounts; information on fees associated with various types of special actions, such
as those associated with the return of checks for
insufficient funds, deposit items returned, and
stop-payment orders; and information on the
various types of fees associated with the use of
ATM services. Percentage changes in fees and
balance requirements, when meaningful data are
available, are presented for the period between
1989 and 1993, along with the corresponding
change in the consumer price index during the
period.
Statements to the Congress
Fees Charged for the Maintenance
Use of Checkable Accounts
and
Analysis of fees charged for the maintenance and
use of checkable accounts over time is complicated by the fact that the terms of accounts can
differ considerably. For example, different
nonchecking services may be provided with the
account; the balances that depositors must maintain to avoid fees may vary; and the mix of fees
charged the account holder can differ widely.
Depository institutions can, and frequently do,
offer more than one type of account. So that fee
information may be compared systematically
over time, the focus in table 2 is restricted to four
rather narrowly defined accounts. Nevertheless,
the many dimensions of even these narrowly
defined accounts make comparisons over time
difficult.
The first of these accounts we have termed a
"single-balance, single-fee, noninterest checking
account." This account pays no interest and
imposes no fee if a minimum balance is maintained; otherwise the account incurs a single
monthly fee but no charge per check. About 38
percent of banks and 23 percent of savings associations offered this account in 1993. The
monthly fee charged by banks averaged about
$5.90 in 1993 and does not seem to have changed
much during the period. Neither the average
minimum balance needed to avoid the fee nor the
average minimum balance required to open the
account at banks increased during the period,
and, in fact, both balances exhibit slight declines.
For savings associations, the monthly fee averaged $5.50 in 1993 and rose about 17 percent over
the period. Although that fee has stabilized over
the past three years, the entire increase over the
full period is roughly equivalent to the change in
the consumer price index (CPI) between the
dates of the 1989 and 1993 surveys.2 As with
banks, the minimum balances associated with
this account at savings associations exhibit, if
anything, slight declines.
The second type of noninterest checking account differs from the first in that failure to
maintain a minimum balance results in a charge
2. The CPI used throughout is the urban index, all items.
721
per check as well as a monthly fee. Only 10
percent to 25 percent of banks and no more than
5 percent of savings associations offered accounts with this fee structure. Because of the
existence of a charge per check, average monthly
fees charged by banks (about $4.00 in 1993) are
lower than those charged for the first type of
account, thus illustrating the need for separate
reporting of these different account types. In
contrast with the first type of account, the average monthly fee charged by banks for this account rose 24 percent between 1989 and 1993.
This increase was substantially higher than the
change in the CPI during the period, although
considerable variation was exhibited in the estimates of this fee. The average charge per check
of about 20 cents, however, did not increase.3
Because so few savings associations offered this
type of account, reliable fee and minimum balance information cannot be reported for savings
associations for four of the five years surveyed.
The third noninterest checking account reported is a fee-only account, defined as an account in which the customer is charged a
monthly fee regardless of the account balance; a
per check charge may also be assessed, but not
necessarily. The proportion of banks and savings
associations offering this type of account increased substantially over the period, with about
42 percent of banks and 18 percent of savings
associations offering the account in 1993. The
average monthly fee charged by banks increased
about 45 percent, about three times the increase
in the CPI, during the period. This increase,
however, exaggerates the overall increase in fees
charged holders of this account because, as indicated, a smaller percentage of the banks surveyed in 1993 included a charge per check and
the per check charge was roughly constant. Similarly, the substantial decline (22 percent) in the
monthly fee registered for savings associations
offering this account is offset by the fact that
check charges were more common in 1993 than
in 1989.
The final checkable account for which fee
information is reported is a NOW account for
3. Estimates from the 1992 Functional Cost Analysis suggest that it costs banks between 22 cents and 26 cents to
process "on us" debit items, which include checks.
722
Federal Reserve Bulletin • August 1994
which the institution charges no fee if a minimum
balance is maintained; otherwise, the institution
levies one monthly fee with no check charges.
This type of account is offered by about half of all
banks and savings associations. Presumably because the account holder receives interest for
balances maintained in this type of account,
average monthly fees and the average minimum
balances required to avoid the fee and open the
account are all higher than in the case of noninterest checking accounts. The monthly fees for
this type of account averaged $7.78 for banks and
$6.50 for savings associations. This fee increased
at banks somewhat less than the increase in the
CPI during the period, although the average
monthly fee increased more than the CPI at
savings associations.
In sum, fees charged for the maintenance and
use of checkable accounts have gone up substantially in some cases. These results lack uniformity, however, because in other cases fees do
not seem to have risen much. Minimum balance
requirements appear to have fallen in a number
of cases, although results are not uniform and
estimates exhibit substantial volatility from year
to year.
Fees Associated with Specialized
or Actions
Services
The picture appears to be quite different in the
case of fees associated with specialized services
or actions. For these types of fees the recorded
increases appear to be a good deal more uniform.
For each item, information is presented both on
the percentage of institutions that charge a fee
and on the average fee calculated for those
institutions that charge.
Between 1989 and 1993, the charge for money
orders increased at banks about the same percentage as did the increase in the CPI and by
substantially more than that at savings associations. Savings associations, on average, charged
less than banks in 1989 but tended to catch up
during the period.
At both banks and savings associations, the
fees charged for stop-payment orders, checks
returned for insufficient funds, and overdrafts all
rose substantially more than the increase in the
CPI during this period. Further, although not all
banks and savings associations were charging
these fees at the beginning of the period, virtually
all institutions imposed these charges by the end
of the period.
The case of the fee charged for returned deposit items is somewhat different. Although average fees did not rise faster than inflation for the
whole period between 1989 and 1993, there appears to have been a substantial jump between
1992 and 1993 at banks. Also, the proportion of
institutions charging for returned deposit items
seems to have increased, particularly at banks.
Taken together, and with the exception of
money orders, I would conclude that, in general,
these kinds of penalty fees have risen sharply
over the past few years, and in most cases the
rise has been greater than that accounted for by
overall inflation. By contrast, the increases in
money order fees appear to have kept pace with
inflation at banks and increased at a faster rate at
savings associations, although the latter started
from a considerably lower base.
Fees Associated with ATM
Services
The surveys covering ATM fees differ from those
covering other items in that the first survey was
conducted in 1988 rather than 1989. Among other
things, this series of surveys requested information from institutions on any yearly fees that they
charge for the use of ATMs and on various types
of transaction fees. These transactions include
withdrawals, deposits, and balance inquiries
made through the use of ATMs. Because fees
may differ depending on whether the customer
uses the institution's own ATM (called an "on
us" transaction) or another institutions's ATM
(called an "on others" transaction), fee information is reported separately.
Results indicate that a small minority of banks
and savings associations charge their customers
an annual fee for the use of ATMs. In recent
years, this fee has been about $10.00 to $12.00
and in general appears to have decreased during
the period.
The most important changes have occurred in
the area of ATM transaction fees. The most
striking change over the past few years has been
the substantial increase in the proportion of
institutions charging for "on others" transac-
Statements to the Congress
tions. The proportion of banks charging for withdrawals "on others," for example, increased
from 50 percent in 1988 to about 76 percent in
1993, while it increased from one-third to about
two-thirds for savings associations during the
period. Other types of "on others" transactions
exhibit similar increases. In contrast, it is relatively uncommon for institutions to charge for
"on us" transactions, and, if anything, the percentage of institutions charging for such transactions seems to have declined over the period.
This distinction between the fees charged for "on
others" and "on us" transactions may be partly
explained by the fact that "on others" transactions typically require a payment to the ATM
network by the customer's institution (which can
range from 3 cents to 20 cents) and a payment to
the owner of the ATM (which can vary between
20 cents and $1.20).
723
Except in the case of withdrawals "on others"
at savings associations, average transaction fees
do not seem to have risen as much as the CPI,
which increased about 22 percent between the
dates of the earliest and latest surveys. Savings
associations appear to have been catching up to
banks for fees charged for withdrawals "on others."
It thus appears from these results that the most
important change occurring in the area of ATM
fees has been the sharp increase in the number of
institutions charging customers for "on others"
transactions.
In summary, the trends in fees seem to depend
very much on the type of fee at issue. Fees
associated with special actions clearly exhibit the
most consistently large increases, while the picture for other types of fees is decidedly more
mixed.
•
724
Announcements
ALAN S. BLINDER: APPOINTMENTS AS A
MEMBER OF THE BOARD OF GOVERNORS
AND AS VICE CHAIRMAN
On April 22, 1994, President Clinton announced
his intention to nominate Alan S. Blinder as a
member of the Board of Governors and as Vice
Chairman. Dr. Blinder was subsequently confirmed
by the Senate on June 24 and took the oath of
office, administered by Chairman Greenspan, on
June 27. The text of the White House announcement follows:
The White House
Office of the Press Secretary
April 22, 1994
Statement by President Clinton on His Nominations for
the Two Vacancies on the Federal Reserve Board
A stable monetary system is the platform upon which
any efforts of economic renewal must be built. My
Administration recognized that our first task was to put
our fiscal house in order, so that an ever-growing federal
budget deficit did not absorb capital and slow economic
growth. I believe that we have now put our nation on the
path to sustainable economic growth. The Federal
Reserve Board is the critical institution that preserves
the stability of our monetary system and the confidence
of our markets. The position of Governor of the Federal
Reserve Board requires acute sensitivity to the need
to strike a careful balance—to prudently manage the
money supply and avoid the excesses of inflation, while
ensuring that the men and women in our economy have
the opportunity to prosper and fulfill their dreams.
To fill the vital job of Vice Chairman of the Federal
Reserve, I am delighted to nominate Dr. Alan Blinder,
currently a member of the Council of Economic Advisers. Dr. Blinder is one of the world's most respected
macroeconomists. He is an expert on fiscal and monetary
policy and productivity, has served as chairman of the
economics department at Princeton, authored countless
articles and books, including one of the Nation's top
textbooks, Economic Principles and Policy, which he
co-authored with William Baumol.
Alan has been an integral part of my economic team
over the last 15 months. He has always expressed his
views to me freely, with intellectual integrity, force and
clarity. He is a keen intellect, who reached the top of his
profession without losing the common touch or ever
forgetting the human implications of the often abstract
economic decisions we in government must make. He
has served as an economic conscience in my Administration, striving to ensure that our policies met the test of
rationality and workability for real people.
I am also pleased to announce my intention to nominate Janet Yellen to a full term on the Federal Reserve
Board. Dr. Yellen is one of the most prominent economists of her generation on the intersection of macroeconomics and labor markets. She is also an expert
in international economics on such issues as the determinants of the balance of trade. She was a clear and
unanimous choice of my top economic advisers who
found her to be a top-flight intellect, with a pragmatic approach to monetary policy and a judicious
temperament.
I am confident that both candidates, if confirmed, will
serve this nation with distinction as Governors of the
Federal Reserve Board.
NOMINATIONS SOUGHT FOR APPOINTMENTS
TO THE CONSUMER ADVISORY
COUNCIL
The Federal Reserve Board announced on June 17,
1994, that it is seeking nominations of qualified
individuals for thirteen appointments to its Consumer Advisory Council.
The Consumer Advisory Council comprises
thirty representatives of consumer and community
interests and of the financial services industry. The
council was established by the Congress in 1976, at
the suggestion of the Board, to advise the Board
on the exercise of its responsibilities under the
Consumer Credit Protection Act and other matters
on which the Board seeks its advice. The council
by law represents the interests both of consumers
and of thefinancialcommunity. The group meets in
Washington, D.C., three times a year.
Thirteen new members will be selected from the
nominations to serve three-year terms that will
begin in January 1995. The Board expects to
announce the selection of new members by yearend 1994.
725
Nominations should be submitted in writing and
should include the address and telephone number
of the nominee. Also, information should be
included about past and present positions held and
special knowledge, interests, or experience related
to consumer credit or other consumer financial
services.
The written nominations must be received by
August 31, 1994, and should be addressed to
Dolores S. Smith, Associate Director, Division of
Consumer and Community Affairs, Board of Governors of the Federal Reserve System, Washington,
DC 20051. Information about nominees will be
available for inspection on request.
PRODUCTION OF VIDEOTAPE FOR USE
IN TRAINING STAFF IN FAIR LENDING
PRACTICES
Production of a videotape designed to help financial institutions combat lending discrimination was
announced on June 2, 1994, by the Federal Reserve
System.
Entitled Closing the Gap: A Guide to Equal
Opportunity Lending, the videotape is designed for
use as a training tool forfinancialinstitutions, trade
associations, and others to help senior management
and their staff to understand fair lending and to
combat discrimination.
The videotape features an introduction by Federal Reserve Chairman Alan Greenspan and a discussion of the ten "best practices," which, if
adopted by financial institutions, would help them
ensure equitable treatment of all applicants and
borrowers. These recommended practices are the
following:
• Staff training programs to make employees
familiar with antidiscrimination laws and sensitive
to how racial and cultural differences may affect
the lending process
• Hiring and promotion practices that foster
racial and ethnic diversity within the financial
institution
• Compensation structures that do not discourage lending to lower-income or financially unsophisticated applicants
• Underwriting standards and practices that do
not arbitrarily disadvantage lower-income and
minority applicants and ensure that all applicants
are treated fairly
• Alternative loan products that help a bank
reduce risks and costs of lending to customers
who may not meet all conventional underwriting
standards
• Second review policies that ensure impartial
reviews of rejected applications
• Marketing strategies designed specifically to
increase awareness of bank products and services
in minority communities
• Participation in small business and homebuyer
education programs, which provide financial and
other types of counseling and technical assistance
for prospective borrowers
• Working with third parties, such as appraisers,
mortgage insurance companies, or real estate
brokers, to ensure fairness in the lending process
• Self-testing and assessments to ensure that all
aspects of the lending process are free from discriminatory practices.
The video was jointly developed by the community affairs programs of the Federal Reserve Banks
of Boston, Chicago, and San Francisco. It is based
on information from a publication of the same
name that was produced by the Federal Reserve
Bank of Boston last year and widely distributed by
the Federal Reserve System.
The videotape was broadcast on American
Financial Sky link, the American Bankers Association's satellite communications network, on Tuesday, July 5.
The Federal Reserve System will provide single
copies of the video to the presidents of all state
banks it supervises as well as numerous bank holding companies for use in their internal training
programs.
The video will also be used by the Federal
Reserve in examiner training and will be featured
in fair lending and community reinvestment conferences and workshops for bankers sponsored by
the Community Affairs programs of the Federal
Reserve Banks.
Additional single or bulk copies of the video
may be obtained from VIDICOPY, 650 Vaqueros
Avenue, Sunnyvale, CA 94086, at the following
rates:
726
Federal Reserve Bulletin • August 1994
1-30 copies—$9.95 each, including shipping and
handling
31-99 copies—$8.95 each, including shipping and
handling
100-249 copies—$5.75 each, plus shipping and
handling
250-500 copies—$4.75 each, plus shipping and
handling.
For additional information on pricing and how to
order copies of the tape, contact VIDICOPY at
1-800-708-7080.
REAL ESTATE APPRAISAL
FINAL AMENDMENTS
REQUIREMENTS:
The Federal Reserve Board and other financial
institutions regulatory agencies issued on June 6,
1994, final amendments to real estate appraisal
requirements. The amendments were effective
June 7, 1994.
The amendments make the following changes:
• Increase to $250,000 the threshold level at or
below which appraisals are not required
• Expand and clarify the type of transactions
that are exempt from the appraisal requirement
• Narrow the type of exempt transactions for
which evaluations are required
• Revise the requirements governing appraisal
content and the use of appraisals prepared by the
financial services institutions.
PROPOSED
ACTIONS
The Federal Reserve Board on June 7, 1994, published for public comment proposed changes to its
Regulation C (Home Mortgage Disclosure Act
(HMDA)), and to the instructions and reporting
forms that financial institutions must use in complying with the annual reporting requirements.
Comments are requested by August 10, 1994.
The Federal Reserve Board on June 6, 1994,
requested public comment on a proposed amendment to Regulation H (Membership of State Banking Institutions in the Federal Reserve System),
which would permit state member banks to make
certain public welfare investments without specific
Board approval and other public welfare investments with specific approval. The proposed rule
also addresses the procedural aspects of these investments. Comments were requested by July 22,
1994.
The Federal Reserve Board on June 28, 1994,
requested public comment on proposed amendments to Regulation T (Credit by Brokers and
Dealers) regarding settlement of securities purchases and the status of government securities
transactions. Comments should be received by
August 15, 1994.
PUBLICATION OF A SUPPLEMENT TO THE
BANK HOLDING COMPANY SUPERVISION
MANUAL
A June 1994 supplement to the Bank Holding
Company Supervision Manual has been published
by the Board's Division of Banking Supervision
and Regulation and is now available for purchase
by the public. The Manual is used by Federal
Reserve examiners in the supervision, regulation,
and inspection of bank holding companies and their
subsidiaries.
The new topics covered in the supplement
include a discussion of a bank holding company's
supervisory oversight responsibility over its subsidiaries in relation to (1) an interagency policy statement on retail sales of nondeposit investment products (that is, mutual funds and annuities); (2) an
interagency policy statement on the maintenance of
an adequate allowance for loan and lease losses
and an effective loan review system; and (3) the
Board's February 1994 revision of Regulation O (Loans to Executive Officers, Directors,
and Principal Shareholders of Member Banks).
Another new section discusses risk management
and internal controls as they pertain to the examiner' s inspection of trading activities. Also discussed
are recent nonbanking activities approved by Board
order including (1) providing a network for the
processing and transmission of medical payment
data and the provision of other incidental services,
(2) issuance and sale of variably denominated payment instruments without limitation as to face
value, (3) engaging in career counseling services,
(4) asset management activities involving nonfinancial institutions, and (5) acting as a dealer-
Announcements 727
manager in connection with cash-tender and
exchange-offer transactions. Other topics that have
been revised include nonbanking activities of, and
investment in, qualifying foreign banking organizations as well as the exemptions for those organizations under sections 2(h) and 4(c)(9) of the Bank
Holding Company Act, and changes to the riskbased capital guidelines to lower the risk weight
from 100 percent to 50 percent for multifamily
housing loans meeting certain criteria, effective
December 31, 1993.
The June 1994 supplement to the Manual may
be ordered for $10.00 from Publications Services,
Mail Stop 127, Board of Governors of the Federal
Reserve System, Washington, DC 20551. The
Manual and all its supplements, through June 1994,
may be ordered from Publications for $50.00.
CHANGES IN BOARD STAFF
The Federal Reserve Board announced the resignation of John Rea, Assistant Director in the Division
of Research and Statistics, effective July 29, 1994.
The Board also announced the promotion of
Jennifer J. Johnson to Deputy Secretary of the
Board. Ms. Johnson was with the Board's staff
from 1975 until 1986. She returned to the Board in
1989 as Associate Secretary of the Board. She
holds a J.D. from the University of Pennsylvania.
729
Legal Developments
FINAL RULE—AMENDMENT
TO REGULATION
A
The Board of Governors is amending 12 C.F.R. Part
201, its Regulation A (Extensions of Credit by Federal
Reserve Banks; Change in Discount Rate) to reflect its
approval of an increase in the basic discount rate at
each Federal Reserve Bank. The Board acted on
requests submitted by the Boards of Directors of the
twelve Federal Reserve Banks.
These amendments to Part 201 (Regulation A) were
effective June 2,1994. The rate changes for adjustment
credit were effective on the dates specified in section
201.51.
201.3(b) is a flexible rate that takes into account rates
on market sources of funds, but in no case will the rate
charged be less than the rate for adjustment credit as
set out in section 201.51.
(b) Extended credit. For extended credit to depository
institutions under section 201.3(c), for credit outstanding for more than 30 days, a flexible rate will be
charged that takes into account rates on market
sources of funds, but in no case will the rate charged
be less than the rate for adjustment credit, as set out in
section 201.51, plus one-half percentage point. At the
discretion of the Federal Reserve Bank, this time
period may be shortened, and the rate may be the
discount rate applicable to adjustment credit.
Part 201—Extensions of Credit by Federal
Reserve Banks (Regulation A)
1. The authority citation for 12 C.F.R. Part 201 is
revised to read as follows:
Authority: 12 U.S.C. 343 et seq., 347a, 347b, 347c,
347d, 348 et seq., 357, 374, 374a and 461.
ORDERS ISSUED UNDER BANK
COMPANY ACT
HOLDING
Orders Issued Under Section 3 of the Bank
Holding Company Act
2. Section 201.51 is revised to read as follows:
United Bancorporation
Osseo, Wisconsin
Section 201.51—Adjustment credit for
depository institutions.
Order Approving the Formation of a Bank Holding
Company
The rates for adjustment credit provided to depository
institutions under section 201.3(a) are:
United Bancorporation, Osseo, Wisconsin ("Bancorporation"), has applied under section 3(a)(1) of the
Bank Holding Company Act ("BHC Act") (12 U.S.C.
§ 1842(a)(1)) to become a bank holding company
within the meaning of the BHC Act by acquiring from
85.11 to 100 percent of the shares of the following
banks (the "Banks"): Cambridge State Bank, Cambridge, Wisconsin (100 percent); Lincoln County
Bank, Merrill, Wisconsin (85.11 percent); United
Bank, Osseo, Wisconsin (96.91 percent); Bank of
Poynette, Poynette, Wisconsin (99.67 percent); Farmers & Merchants State Bank, Iroquois, South Dakota
(91.20 percent); Farmers State Bank, Stickney, South
Dakota (100 percent); and Clarke County State Bank,
Osceola, Iowa (88.82 percent). 1
Federal Reserve Bank
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
Rate
3.5
3.5
3.5
3.5
3.5
3.5
3.5
3.5
3.5
3.5
3.5
3.5
Effective
May
May
May
May
May
May
May
May
May
May
May
May
17,
17,
17,
18,
17,
17,
17,
17,
17,
17,
17,
17,
1994
1994
1994
1994
1994
1994
1994
1994
1994
1994
1994
1994
Section 201.52—Extended credit for depository
institutions.
(a) Seasonal credit. The rate for seasonal credit extended to depository institutions under section
1. This transaction constitutes a reorganization of interests by the
majority shareholder of the Banks. After consummation of this
transaction, the majority shareholder, members of his family and a
730
Federal Reserve Bulletin • August 1994
Notice of the application, affording interested persons an opportunity to submit comments, has been
published (59 Federal Register 15,731 (1994)). The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the factors set forth in section 3(c) of
the BHC Act.
Bancorporation is a nonoperating corporation
formed for the purpose of acquiring the Banks. Upon
consummation of this proposal, Bancorporation would
become the 25th largest commercial banking organization in Wisconsin, controlling deposits of $156.9 million, representing less than 1 percent of total deposits
in commercial banking organizations in the state;2 the
85th largest commercial banking organization in Iowa,
controlling deposits of $70.4 million, representing less
than 1 percent of total deposits in commercial banking
organizations in the state; and the 34th largest commercial banking organization in South Dakota, controlling deposits of $39.5 million, representing less
than 1 percent of total deposits in commercial banking
organizations in the state.
Section 3(d) of the BHC Act, the Douglas Amendment, prohibits the Board from approving an application by a bank holding company to acquire control of
any bank located outside the bank holding company's
home state, unless such acquisition is "specifically
authorized by the statute laws of the State in which
such bank is located, by language to that effect and not
merely by implication."3 For purposes of the Douglas
Amendment, the home state of Bancorporation is
Wisconsin.4 Bancorporation proposes to acquire
banks in Iowa, South Dakota, and Wisconsin.
The interstate banking statute of Iowa permits outof-state bank holding companies located in states in a
certain region, including Wisconsin, to acquire banks
located in Iowa, subject to certain conditions and to
the approval of the Superintendent of Banking.5 All
corporation under their control will own shares in Bancorporation in
proportion to their current ownership interests in the Banks.
2. All deposit data are as of June 30, 1993.
3. 12 U.S.C. § 1842(d).
4. A bank holding company's home state is that state in which the
operations of the bank holding company's banking subsidiaries were
principally conducted on July 1, 1966, or the date on which the
company became a bank holding company, whichever is later. See
12 U.S.C. § 1842(d). Upon consummation of this transaction, Bancorporation would become a bank holding company and the operations of
its banking subsidiaries would be principally conducted in Wisconsin.
5. Iowa Code Ann. § 524.1903. Under Iowa law, the out-of-state
bank holding company must have been in existence for at least three
years, and the bank to be acquired must have been in existence and
continuously operated as a bank for five years or more. Iowa Code
Ann. § 524.1906(3). Although Bancorporation has not been in existence for three years, the Iowa statute provides that this requirement
is fulfilled if the bank holding company is newly organized solely for
the purpose of facilitating the acquisition of another bank that has
been in existence and continuously operated for the requisite period.
the conditions of the Iowa statute have been met by
this proposal.6
South Dakota law expressly authorizes the acquisition of a South Dakota bank by an out-of-state bank
holding company.7 In order to approve such an acquisition, the South Dakota Banking Commission must
find either that the laws of the jurisdiction in which the
bank holding company is located, in this case, Wisconsin, are reciprocal with the laws of South Dakota,8
or that the jurisdiction in which the out-of-state bank
holding company is located permits the proposed
acquisition because South Dakota has authorized interstate banking acquisitions.9 Wisconsin corporate
law authorizes any corporation located in Wisconsin
to acquire shares of any entity and conduct its business within or outside of Wisconsin, and Wisconsin
bank holding companies may exercise this general
corporate authority. The South Dakota Attorney General and Director of Banking have indicated that this
proposal meets the requirements of South Dakota's
interstate banking statute.10 Based on these opinions,
and all other facts of record, the Board has concluded
that Bancorporation is authorized under the statute
laws of Iowa and South Dakota to acquire the Banks
located in those states. Accordingly, Board approval
of this proposal is not prohibited by the Douglas
Amendment. Approval of this proposal is conditioned,
however, upon the receipt by Bancorporation of all
required state regulatory approvals.
Banks do not compete directly in any relevant
banking market. Based on all the facts of record, the
Board concludes that consummation of the proposal
would not have any substantially adverse effect on
competition or on the concentration of banking resources in any relevant banking market. The Board
Iowa Code Ann. § 524.1906(4)(b). The Iowa bank to be acquired has
been in existence and continuously operated for over five years.
6. Bancorporation is newly organized for the purpose of acquiring
the Banks.
7. S.D. Codified Laws Ann. § 51A-2-38.
8. S.D. Codified Laws Ann. § 51A-2-38(l). Wisconsin law does not
meet the reciprocity requirement of the South Dakota statute because
Wisconsin permits acquisitions of Wisconsin banking institutions by
out-of-state bank holding companies that have their principal place of
business in a limited region which does not include South Dakota.
9. Section 51A-2-38(2) of the South Dakota interstate banking
statute permits the Banking Commission to approve the acquisition of
a South Dakota bank by an out-of-state bank holding company if the
"statutes of the jurisdiction in which the operations of the out-of-state
bank holding company's banking subsidiaries are principally conducted authorize the acquisition of control because the out-of-state
bank holding company or subsidiary is authorized by §§ 51A-2-38 to
51A-2-41, inclusive, to acquire control of and hold shares of banking
institutions in this state . . . "
10. The Board previously has accorded substantial weight to
reasoned opinions of a state's Attorney General or banking agency
that are not inconsistent with the language or purpose of a statute.
Bancorp of Mississippi, Inc., 72 Federal Reserve Bulletin 257 (1986);
Mellon National Corporation, 70 Federal Reserve Bulletin 441 (1984).
Legal Developments
also concludes that financial and managerial resources
and future prospects of Bancorporation, and the other
supervisory factors that the Board must consider
under section 3 of the BHC Act, are consistent with
approval of this proposal. Considerations relating to
the convenience and needs of the communities to be
served also are consistent with approval.
Based on the foregoing and other facts of record, the
Board has determined that the application should be,
and hereby is, approved. The Board's approval is
expressly conditioned upon compliance with all the
commitments made by Bancorporation in connection
with this application and with the conditions referred
to in this order. The commitments and conditions
relied on by the Board in reaching this decision are
both deemed to be conditions imposed in writing by
the Board in connection with its findings and decision,
and, as such, may be enforced in proceedings under
applicable law.
The acquisition of the Banks shall not be consummated before the thirtieth calendar day following the
effective date of this order, or later than three months
after the effective date of this order, unless such period
is extended for good cause by the Board or by the
Federal Reserve Bank of Minneapolis, acting pursuant
to delegated authority.
By order of the Board of Governors, effective
June 27, 1994.
Voting for this action: Chairman Greenspan and Governors
LaWare, Lindsey, and Phillips. Absent and not voting:
Governor Kelley.
JENNIFER J. JOHNSON
Associate Secretary of the Board
Orders Issued Under Section 4 of the Bank
Holding Company Act
The Chase Manhattan Corporation
New York, New York
Order Approving an Application to Engage in
Underwriting and Dealing in Bank-Ineligible
Securities on a Limited Basis
The Chase Manhattan Corporation, New York, New
York ("Chase"), a bank holding company within the
meaning of the Bank Holding Company Act ("BHC
Act"), has applied under section 4(c)(8) of the BHC
Act (12 U.S.C. § 1843(c)(8)), and section 225.23 of the
Board's Regulation Y (12 C.F.R. 225.23), to engage
de novo through its wholly owned subsidiary, Chase
Securities, Inc., New York, New York ("Company"),
a broker-dealer registered with the Securities and
731
Exchange Commission under the Securities Exchange
Act of 1934 (15 U.S.C. 78a et seq.), in underwriting
and dealing, to a limited extent, in all types of equity
securities, including, without limitation, common
stock; American Depositary Receipts; Global Depositary Receipts; securities convertible into equity securities and options; other direct and indirect equity
ownership interests in domestic and foreign corporations and other entities; warrants and other rights
issued in connection with the above securities; and
securities issued by closed-end investment companies,
but not including ownership interests in open-end
investment companies. Chase proposes to conduct
these activities worldwide.
Notice of the application, affording interested persons an opportunity to submit comments on the proposal, has been published (59 Federal Register 21,767
(1994)). The time for filing comments has expired, and
the Board has considered the application and all
comments received in light of the public interest
factors set forth in section 4(c)(8) of the BHC Act.
Chase, with total consolidated assets of $112.6 billion, operates bank subsidiaries in New York, Connecticut, Delaware, Florida, and Arizona.1 Chase has
received Federal Reserve approval to engage directly
and through subsidiaries in a broad range of permissible nonbanking activities, including underwriting and
dealing in all types of debt securities on a limited
basis.2 Company is, and will continue to be, a brokerdealer registered with the Securities and Exchange
Commission ("SEC"), and a member of the National
Association of Securities Dealers, Inc. ("NASD").
Accordingly, Company is subject to the record-keeping, reporting, fiduciary standards, and other requirements of the Securities Exchange Act of 1934
(15 U.S.C. § 78a et seq.), the SEC, and the NASD.
The Board has determined that, subject to the
prudential framework of limitations established in previous decisions to address the potential for conflicts of
interests, unsound banking practices, or other adverse
effects, the proposed activities of underwriting and
dealing in bank-ineligible securities are so closely
related to banking as to be proper incidents thereto
within the meaning of section 4(c)(8) of the BHC Act. 3
1. Asset data are as of March 31, 1994.
2. See J.P. Morgan & Co., Inc., et al., 75 Federal Reserve Bulletin
192 (1989). As used in this order, "bank-ineligible securities" refers to
all types of debt and equity securities that a bank may not underwrite
or deal in directly under section 20 of the Glass-Steagall Act
(12 U.S.C. § 377).
3. See Canadian Imperial Bank of Commerce, 76 Federal Reserve
Bulletin 158 (1990); J.P. Morgan & Co. Incorporated, et al., 75
Federal Reserve Bulletin 192 (1989), affd sub nom. Securities Industries Ass'n v. Board of Governors of the Federal Reserve System, 900
F.2d 360 (D.C. Cir. 1990); Citicorp, et al., 73 Federal Reserve Bulletin
473 (1987), affd sub nom. Securities Industry Ass'n v. Board of
732
Federal Reserve Bulletin • August 1994
The Board also has determined that the conduct of
these securities underwriting and dealing activities is
consistent with section 20 of the Glass-Steagall Act
(12 U.S.C. § 377), provided that the company engaged
in the underwriting and dealing activities derives no
more than 10 percent of its total gross revenue from
underwriting and dealing in bank-ineligible securities
over any two-year period.4 Chase has committed that
Company will conduct its underwriting and dealing
activities with respect to bank-ineligible securities
subject to the 10-percent revenue test, and the prudential limitations established by the Board in previous
orders.
The Federal Reserve Bank of New York ("Reserve
Bank") is reviewing the operational and managerial
infrastructure of Company, including its computer,
audit, and accounting systems, and internal risk management procedures and controls. The Board's ap-
Governors of the Federal Reserve System, 839 F.2d 47 (2d Cir.), cert,
denied, 486 U.S. 1059 (1988) (collectively, "Section 20 Orders").
Chase has committed to conduct the proposed underwriting and
dealing activities using the same methods and procedures and subject
to the same prudential limitations as those established by the Board in
the Section 20 Orders.
Chase proposes for its subsidiary banks and the direct and indirect
broker-dealer subsidiaries of those banks (including overseas brokerdealer subsidiaries of Edge Act subsidiaries) to act as a riskless
principal or broker for customers in buying and selling bank-eligible
securities that Company underwrites or deals in. Except as described
below, there would be no employees in common between Company
and any of its bank affiliates or their subsidiaries. In addition,
Company's arrangement to sell bank-eligible securities through affiliated banks and their subsidiaries would not involve any exclusive
arrangements. Company's role in underwriting or dealing in securities
brokered by its affiliates would be fully disclosed to the affiliates'
brokerage customers, and all such brokerage transactions would be
conducted on an arm's length basis. The Board previously has
determined that these activities are consistent with the Glass-Steagall
Act. See Chemical Banking Corporation, 80 Federal Reserve Bulletin
49 (1994); BankAmerica Corporation, 79 Federal Reserve Bulletin
1163 (1993). The Board also notes that the sale by a financial
institution of uninsured investment products, such as bank-eligible
securities, must comply with applicable regulations and guidelines of
the institution's primary federal regulator.
A limited number of employees of the foreign subsidiaries of
Chase's bank subsidiaries would serve as employees of Company. As
employees of Company, they would be engaged solely in marketing,
outside the United States, the securities and services of Company, and
the related creation of underwriting syndicates, or the dissemination
of research, all involving non-U.S. issuers. These employees would
not be involved in selling securities to investors in the United States.
The Board also has considered Chase's request for the foreign
subsidiaries of Company's bank affiliates to market the securities of
Company overseas. The Board has approved this request by a
separate letter.
4. See Section 20 Orders. Compliance with the 10-percent revenue
limitation shall be calculated in accordance with the method stated in
the Section 20 Orders, as modified by the Order Approving Modifications to the Section 20 Orders, 75 Federal Reserve Bulletin 751 (1989),
the Order Approving Modifications to the Section 20 Orders, 79 Federal Reserve Bulletin 226 (1993), and the Supplement to Order
Approving Modifications to Section 20 Orders, 79 Federal Reserve
Bulletin 360 (1993) (collectively, "Modification Orders"). The Board
notes that Chase has adopted the Board's alternative indexed-revenue
test to measure compliance with the 10-percent limitation on bankineligible securities activities.
proval of this proposal is conditioned upon a satisfactory determination by the Reserve Bank that
Company's operational and managerial infrastructure
and policies and procedures relating to underwriting
and dealing in equity securities are adequate to ensure
compliance with the requirements of the Section 20
Orders. The Board has reviewed the capitalization of
Chase and Company in accordance with the standards
set forth in the Section 20 Orders, and finds the
capitalization of each to be consistent with approval.
With respect to the capitalization of Company, approval of the requested activities is limited to a level
consistent with the projections of position size and
types of securities in the application. Accordingly,
subject to the satisfactory completion of the Reserve
Bank's review of Company's operational and managerial infrastructure and policies and procedures, the
Board concludes that the financial and managerial
considerations are consistent with approval of this
application.
In order to approve this application, the Board also
must determine that the performance of the proposed
activities by Chase can reasonably be expected to
produce public benefits that would outweigh possible
adverse effects under the proper incident to banking
standard of section 4(c)(8) of the BHC Act. Under the
framework established in this and prior decisions,
consummation of this proposal is not likely to result in
any significant adverse effects, such as undue concentration of resources, decreased or unfair competition,
conflicts of interests, or unsound banking practices.
The Board expects that the de novo entry of Chase
into the market for the proposed services in the United
States would provide added convenience to Chase's
customers, and would increase the level of competition among existing providers of these services. Accordingly, the Board has determined that the performance of the proposed activities by Chase could
reasonably be expected to produce public benefits that
would outweigh possible adverse effects under the
proper incident to banking standard of section 4(c)(8)
of the BHC Act.
Accordingly, and for the reasons set forth in the
Section 20 Orders, the Board concludes that Chase's
proposal to engage through Company in the proposed
activities is consistent with the Glass-Steagall Act,
and is so closely related to banking as to be a proper
incident thereto within the meaning of section 4(c)(8)
of the BHC Act, provided Chase limits Company's
activities as provided in the Section 20 Orders, as
modified by the Modification Orders.
On the basis of the record, the Board has determined to, and hereby does, approve this application
subject to all the terms and conditions discussed in this
order and in the Section 20 Orders as modified by the
Legal Developments
Modification Orders. The Board's approval of this
proposal extends only to activities conducted within
the limitations of those orders and this order, including
the Board's reservation of authority to establish additional limitations to ensure that Company's activities
are consistent with safety and soundness, conflict of
interest, and other relevant considerations under the
BHC Act. Underwriting and dealing in any manner
other than as approved in this order or the Section 20
Orders (as modified by the Modification Orders) is not
within the scope of the Board's approval and is not
authorized for Company.
The Board's determination is also subject to all the
terms and conditions set forth in Regulation Y, including those in sections 225.4(d) and 225.23(b), and to the
Board's authority to require modification or termination of the activities of a bank holding company or any
of its subsidiaries as the Board finds necessary to
assure compliance with, and to prevent evasion of, the
provisions of the BHC Act, and the Board's regulations and orders issued thereunder. The Board's decision is specifically conditioned on compliance with all
the commitments made in connection with this application, including the commitments discussed in this
order and the conditions set forth in the above noted
Board regulations and orders. These commitments and
conditions shall be deemed to be conditions imposed
in writing by the Board in connection with its findings
and decisions, and may be enforced in proceedings
under applicable law.
This transaction shall not be consummated later
than three months after the effective date of this order
unless such period is extended for good cause by the
Board, or by the Federal Reserve Bank of New York
acting pursuant to delegated authority.
By order of the Board of Governors, effective
June 6, 1994.
Voting for this action: Chairman Greenspan and Governors
Kelley, LaWare, Lindsey, and Phillips.
733
§ 1843(c)(8)) and section 225.23 of the Board's Regulation Y (12 C.F.R. 225.23) to acquire all of the voting
shares of the following nonbanking subsidiaries of The
Dreyfus Corporation, New York, New York ("Dreyfus"):
(1) The Dreyfus Security Savings Bank, F.S.B.,
Paramus, New Jersey ("DSSB"), and thereby engage in operating a savings association pursuant to
section 225.25(b)(9) of the Board's Regulation Y;1
(2) The Dreyfus Trust Company, Uniondale, New
York ("DTC"), and thereby engage in operating a
trust company pursuant to section 225.25(b)(3) of
the Board's Regulation Y; and
(3) The Truepenny Corporation, New York, New
York ("Truepenny"), and its subsidiaries, and
thereby engage in community development advisory
activities and in development of residential housing
in an urban redevelopment project located in New
York City, known as the Queens West Development
Project ("Project").2
Notice of the application, affording interested persons an opportunity to submit comments on the proposal, has been published (59 Federal Register 23,066
(1994)). The time for filing comments has expired, and
the Board has considered the application and all
comments received in light of the factors set forth in
section 4(c)(8) of the BHC Act.
Applicant, with total consolidated assets of
$36.7 billion, is the 24th largest commercial banking
organization in the United States and operates bank
subsidiaries in Pennsylvania, Delaware, Maryland,
and Massachusetts.3 Applicant engages through its
subsidiaries in a broad range of banking and permissible nonbanking activities.
Section 4(c)(8) of the BHC Act provides that a bank
holding company may, with Board approval, engage in
any activity that the Board determines to be "closely
related to banking or managing or controlling banks."
The Board also must determine that the activity is a
JENNIFER J. JOHNSON
Associate Secretary of the Board
Mellon Bank Corporation
Pittsburgh, Pennsylvania
Order Approving Application to Acquire Nonbanking
Companies
Mellon Bank Corporation, Pittsburgh, Pennsylvania
("Applicant"), a bank holding company within the
meaning of the Bank Holding Company Act ("BHC
Act"), has applied for the Board's approval under
section 4(c)(8) of the BHC Act (12 U.S.C.
1. DSSB is a federally chartered savings bank insured by the Bank
Insurance Fund of the Federal Deposit Insurance Corporation. In
addition to its principal office, DSSB operates a branch office in San
Francisco, California, and has received approval from the Office of
Thrift Supervision to open 13 interstate branches located in California,
New York, Illinois, Colorado, Georgia, Florida, and Massachusetts.
2. Applicant proposes to acquire these nonbanking companies
simultaneously with the acquisition by Applicant's lead bank subsidiary, Mellon Bank, N.A., Pittsburgh, Pennsylvania, of Dreyfus and its
securities brokerage, investment advisory, and mutual fund administrative subsidiaries. The Office of the Comptroller to the Currency
recently approved the acquisition of these securities-related companies. See Letter from Frank Maguire, Office of the Comptroller of the
Currency, to Michael E. Bleier (May 4, 1994). Applicant proposes to
acquire DSSB and DTC, through its wholly owned subsidiary, MBC
Investments Corporation ("MBC Investments"), and to acquire
Truepenny directly.
3. Asset data are as of March 31, 1994.
734
Federal Reserve Bulletin • August 1994
proper incident to banking. In judging whether the
performance of an activity meets the proper incident
to banking test, the Board must determine whether the
proposed activity can reasonably be expected to produce public benefits that outweigh any possible adverse effects.
Proposed Involvement in Real Estate Project
Applicant contends that the proposed activities of
Truepenny are permissible community development
activities under section 225.25(b)(6) of Regulation Y,
which permits bank holding companies to participate
in community development activities by making equity
and debt investments in corporations or projects designed primarily to promote community welfare.4 The
proposal raises the issue of whether the activities of
Truepenny, through its wholly owned subsidiary, The
Trotwood Corporation, New York, New York ("Trotwood"), as a partial owner and manager of the Project,
are permissible community development activities under Regulation Y. 5
The Project is a large-scale, urban redevelopment
initiative, jointly sponsored by government and private entities, involving the development of a largely
abandoned waterfront area of the Borough of Queens
in New York City. The Project is planned as a longterm, four-phase development, consisting of three
primarily residential developments and a commercialretail development, with a park, a new public elementary school, and a community-recreation center, that
will be developed over the next twenty years.
Trotwood indirectly acts as a managing general
partner of M.O. Associates, L. P. ("M.O. Associates"), a private development venture, which:
(1) Actively participates in the management and
planning of the Project's first phase,
(2) Has a substantial ownership interest in the land
designated for development as the Project's first
phase, and
(3) Has preliminary rights to develop the first of four
residential buildings in the first phase. 6
4. 12 C.F.R. 225.25(b)(6).
5. Trotwood also has provided advisory services to several other
community development corporations and to a foreign government on
the financing of residential housing for low- and moderate-income
persons and business development in low- and moderate-income
areas. These activities are permissible for bank holding companies and
Applicant has committed that Trotwood would conduct future similar
activities in a manner consistent with the Board's prior approvals.
See, e.g., The Shorebank Corporation, 78 Federal Reserve Bulletin
619 (1992).
6. Trotwood acts as joint managing general partner of Hunters Point
Associates, L. P. ("Hunters Point"), which, in turn, acts as managing
general partner of M.O. Associates. Trotwood also holds, through two
subsidiaries, additional general partnership and limited partnership
interests in M.O. Associates. The other general partners of Hunters
Trotwood also indirectly owns a small parcel of land
designated for development in the Project's second
phase and holds an option to acquire or develop the
remaining land in this second phase.
The Board, in Regulation Y, has permitted bank
holding companies to engage in "making equity and
debt investments in corporations or projects designed
primarily to promote community welfare, such as the
economic rehabilitation and development of lowincome areas by providing housing, services, or jobs
for residents."7 Applicant contends that the merits of
the Project justify permitting Applicant to continue
Dreyfus's investment and development role in the
Project.8 In this regard, Applicant asserts that, while
not directed at low- to moderate-income persons, the
Project's first phase is targeted to New York City's
working "middle class." In addition, Applicant contends that the Project would benefit the community by
revitalizing a geographic area that is largely abandoned. Applicant points out that state and local governments have committed substantial financial resources to the Project and, as confirmed by comment
letters received by the Board, view it as critical to this
area's revitalization.
In each review of a proposed community development activity, the Board has required that the promotion of community welfare, in particular, low- and
moderate-income individuals, be the primary thrust of
the activity rather than a collateral effect. 9 In determining whether a real estate-related community devel-
Point, and the other limited partners of Hunters Point and M.O.
Associates, include entities controlled by unaffiliated real estate
developers and investors.
7. 12 C.F.R. 225.25(b)(6). In a policy statement, the Board has
outlined several examples of permissible community development
projects, which include projects:
(1) To construct or rehabilitate housing for low- or moderate-income
persons,
(2) To construct or rehabilitate ancillary local commercial facilities
necessary to provide goods or services principally to persons
residing in low- and moderate-income housing, and
(3) Designed explicitly to create improved job opportunities for lowor moderate-income groups. The Board's policy statement also
provides that investments in a project organized to build or rehabilitate high-income housing, or commercial facilities that are not
designed explicitly to create improved job opportunities for lowincome persons, are presumed not to be designed primarily to
promote community welfare, unless there is substantial evidence to
the contrary, even if to some extent the investment may benefit the
community. 12 C.F.R. 225.127.
8. See, e.g., Luxemburg Bancshares, Inc., 11 Federal Reserve
Bulletin 63 (1991); First Financial Corporation, 76 Federal Reserve
Bulletin 671 (1990).
9. See, e.g., Shorebank Corporation, 78 Federal Reserve Bulletin
619 (1992) (provision of financial assistance to small business projects
designed explicitly to create improved job opportunities for low- and
moderate-income groups); R.I.H.T., 58 Federal Reserve Bulletin 595
(1972) (denial of an application to invest in a shopping and office
complex on a parcel of real estate in an urban renewal project,
concluding that a project of this type would only collaterally promote
the community welfare).
Legal Developments
opment proposal meets the community welfare test,
the Board generally has distinguished community development investments from entrepreneurial investments on the basis of whether the proposed residential
development was designed primarily for low- or moderate-income persons. 10 The Board generally has considered the term "low- or moderate-income" to mean,
as determined by the Department of Housing and
Urban Development, a level of income that is below
80 percent of the median income of the relevant
metropolitan statistical area.11 Moreover, the Board
has not recognized as permissible real estate development projects that do not provide direct benefits
primarily to low- and moderate-income persons.
Based on the record, the Board does not believe that
Applicant's proposed participation in the Project is
within the scope of activities permitted by section
225.25(b)(6) of Regulation Y. The Board recognizes,
however, the important role Dreyfus has played and
continues to play in the Project, that Dreyfus has a
relatively small financial investment in the Project, and
that its contribution to the Project has been largely
through the provision of advisory and management
assistance.12 In light of this, the expected benefits of
the Project, the fact that this proposal represents a
small portion of Applicant's acquisition of Dreyfus,
and other facts of record, the Board has determined to
permit Mellon to continue Dreyfus's involvement in
the Project through the projected completion of the
first phase of the Project.13 By the end of this period,
10. See 12 C.F.R. 225.127.
11. Applicant has indicated that at least 10 percent of the approximately 1500 units planned for the four buildings in the Project's first
phase would be "below market" set-aside units, allocated to low-,
moderate- and middle-income persons who are elderly or local residents. Applicant represents that, apart from these set-aside units,
M.O. Associates expects to market the units in the first building to
persons with minimum household incomes ranging from about $22,000
to $75,000, depending on the type of unit, with the majority of the units
targeted to persons with minimum household incomes ranging from
about $35,000 to $60,000. However, the proposal does not include any
limitation on sales of units, apart from the set-aside units, to highincome persons. The current adjusted median income of the New
York Metropolitan Statistical Area approximates $42,000, meaning
that low- and moderate-income households would include households
earning no more than $33,600. Applicant anticipates similar development plans for the other buildings in the Project's first phase.
12. The Board has received a number of comments, including
comments from several members of Congress, the New York Governor, local governmental officials, and various union officials, unanimously expressing support of the proposal and concern about anticipated harm to the Project in the event Trotwood is required at this
time to discontinue its involvement in the Project. Many of these
commenters have advised that Trotwood, through its indirect management of M.O. Associates, plays a pivotal leadership role in the
Project, particularly at this time when commencement of the infrastructure improvements by the government and construction of the
first phase by M.O. Associates are imminent, and that the success of
this first phase is critical to the success of the entire Project.
13. Applicant has indicated that the Project's first phase should be
completed within seven years. If within such time period the first
735
Applicant must terminate or otherwise conform its
involvement in the Project to the requirements of
Regulation Y and this order. This period should permit
Applicant a reasonable opportunity to terminate or
conform its involvement in the Project in an orderly
manner.
Acquisition of Savings Association and Trust
Company
The Board has previously determined, by regulation,
that operating a savings association and a trust company are closely related to banking.14 Applicant has
committed that DSSB and DTC will conduct their
activities pursuant to the conditions and limitations
specified in the Board's regulations.15 In considering
the proposed acquisition of DSSB and DTC, the Board
must consider the financial condition and resources of
the applicant and its subsidiaries and the effect of the
proposal on these resources.16 Based on all the facts of
record, the Board has concluded that financial and
managerial considerations are consistent with approval of this proposal.
The Board also expects that Company's conduct of
the proposed savings association and trust company
activities would enable Applicant to provide added
convenience and services to its customers, and would
not significantly reduce the level of competition among
existing providers of these services. Accordingly,
based on all the facts of record, including the commitments provided by Applicant, and the conditions specified above, the Board has concluded that approval of
the application can reasonably be expected to produce
public benefits that would outweigh possible adverse
phase is not completed, Applicant must seek Federal Reserve System
consent for continued involvement in the Project's first phase. During
this period, Applicant may not increase its investment or financial
involvement in the Project without consent of the Federal Reserve
System, and must consult with the System in the event that any
material changes are expected to the development plans.
14. 12 C.F.R. 225.25(b)(3) and (9).
15. Section 225.25(b)(9) of Regulation Y requires that savings
associations acquired by bank holding companies conform their direct
and indirect activities to those permissible for bank holding companies
under section 4(c)(8) of the BHC Act and Regulation Y. Applicant has
committed that, should DSSB be found to engage in any impermissible
activities, Applicant will divest these activities, as follows:
(1) Any impermissible securities or insurance activities will cease on
or before consummation (for up to two years following consummation, DSSB may continue to service insurance policies existing at
the time of consummation, but will not renew these policies); and
(2) Any impermissible real estate activities will be divested within
two years of consummation of the proposal and no new impermissible projects or investments will be undertaken (and capital adequacy guidelines will be met excluding specified real estate investments).
16. See 12 C.F.R. 225.24. See also The Fuji Bank, Limited,
75 Federal Reserve Bulletin 94 (1989); Bayerische Vereinsbank AG,
73 Federal Reserve Bulletin 155 (1987).
736
Federal Reserve Bulletin • August 1994
effects under the proper incident to banking standard
of section 4(c)(8) of the BHC Act. 17
Based on the foregoing and all the facts of record,
including the commitments made in connection with
the application, the Board has determined to, and
hereby does, approve the application, subject to the
conditions specified in this order as well as compliance
with all the commitments made in connection with this
application.18 The Board's determination also is subject to all the terms and conditions set forth in Regulation Y, including those in sections 225.4(d) and
225.23(b) of Regulation Y, and to the Board's authority to require such modification or termination of the
activities of a bank holding company or any of its
subsidiaries as the Board finds necessary to ensure
compliance with, and to prevent evasion of, the provisions of the BHC Act and the Board's regulations
and orders issued thereunder. For purposes of this
action, these commitments and conditions are deemed
to be conditions imposed in writing by the Board in
connection with its findings and decision, and, as such,
may be enforced in proceedings under applicable law.
This transaction shall not be consummated later
than three months after the effective date of this order,
unless such period is extended for good cause by the
Board or by the Federal Reserve Bank of Cleveland,
acting pursuant to delegated authority.
By order of the Board of Governors, effective
June 22, 1994.
Voting for this action: Chairman Greenspan and Governors
Kelley, La Ware, Lindsey, and Phillips.
JENNIFER J. JOHNSON
Associate Secretary of the Board
Meridian Bancorp, Inc.
Reading, Pennsylvania
Order Approving Application to Engage De Novo in
Investment Advisory and Private Placement
Activities
Meridian Bancorp, Inc., Reading, Pennsylvania ("Applicant"), a bank holding company within the meaning
of the Bank Holding Company Act ("BHC Act"), has
applied under section 4(c)(8) of the BHC Act and
section 225.23 of the Board's Regulation Y (12 C.F.R.
225.23) to engage de novo through a wholly owned
subsidiary, McGlinn Capital Management, Inc., Wyomissing, Pennsylvania ("Company"),1 in the following
securities-related activities nationwide:
(1) Providing investment advice to and investing in a
series of unregistered limited partnerships now existing or to be established in the future ("Partnerships");
(2) Privately placing limited partnership interests in
the Partnerships with a limited number of investors,
all of whom are sophisticated investors; and
(3) Providing portfolio investment advice (including
the exercise of investment discretion) to institutional customers.
17. The Board received a comment from the president of a bank
holding company urging careful scrutiny of any assurances that
Applicant has made in connection with this application, in light of
disputes that have arisen with respect to a loan that Applicant's lead
bank ("Bank") made to the company's employee stock ownership
plan. Applicant has responded that the commenter misstated certain
facts and that the essential allegations by the commenter were raised
and rejected by a federal district court, which granted Bank's motion
for summary judgment in a loan collection action that Bank brought
against this bank holding company. After considering this comment
and Applicant's response, the Board does not believe that the comment raises any adverse effects that are not outweighed by the public
benefits of Applicant's proposal, under the proper incident to banking
standard of section 4(c)(8).
18. Applicant proposes to acquire all the voting shares of Dreyfus
Partnership Management, Inc. ("DPM"). DPM serves as a nonmanaging general partner of two mutual funds organized as limited
partnerships, which are advised and managed by Dreyfus. Applicant
has committed that, by December 31, 1997, each mutual fund will be
reorganized in corporate or trust form and DPM will no longer serve
as a non-managing general partner of, or have an equity interest in,
either fund. Prior to that time, Applicant has committed that DPM will
not own more than 5 percent of the outstanding shares of either mutual
fund and that each fund will limit its holdings to not more than
5 percent of the outstanding voting shares, and to not more than
25 percent of the total equity, of any company. Applicant also has
committed that neither DPM nor any Mellon affiliate will serve as a
non-managing general partner (or other form of general partner) of any
other mutual fund organized in partnership form, without the Board's
approval or unless applicable law is changed to permit such activity.
In addition, Applicant's duties as a non-managing general partner
have been limited and will not permit Applicant to engage in management of the funds, except in the extraordinary event that no managing
general partner remains to continue the business of the fund. Should
such event occur, DPM's role as managing general partner would
terminate within 90 days.
Notice of the application, affording interested persons an opportunity to submit comments on the proposal, has been published (59 Federal Register 11,995
(1994)). The time for filing comments has expired, and
the Board has considered the application and all
comments received in light of the public interest
factors set forth in section 4(c)(8) of the BHC Act.
Applicant, with total consolidated assets of approximately $14 billion, is the fifth largest commercial
banking organization in Pennsylvania.2 Applicant op-
Applicant also proposes to acquire, through MBC Investments, all
the voting shares of Dreyfus Realty Advisors, Inc. ("DRA"), Major
Trading Corporation ("MTC"), and Dreyfus Acquisition Corporation
("DAC"), each of which are located in New York, New York, but has
committed to divest DRA (including its 21 subsidiaries) and to dissolve
MTC and DAC within two years of consummation of this proposal.
1. Applicant will organize Company to acquire the assets and
business of an unaffiliated company of the same name.
2. Asset and market data are as of December 31, 1993.
Legal Developments
erates subsidiary banks in Pennsylvania, Delaware,
and New Jersey, 3 and engages directly and through
subsidiaries in a broad range of permissible nonbanking activities. Company would be registered as an
investment adviser with the Securities and Exchange
Commission ("SEC") and, therefore, would be subject to the recordkeeping, reporting, fiduciary standards, and other requirements of the Investment
Advisers Act of 1940 (15 U.S.C. § 80b-l et seq.) and
the SEC.
Company would be the investment adviser, administrator, and sole general partner of a series of seven
Partnerships that are sold to a small number of institutional investors.4 Company would maintain an equity interest of approximately 1.25 percent of total
capitalization in each Partnership.5
The Partnerships are engaged solely in investing in
limited amounts of debt and equity securities, including interests in real estate investment trusts.6 The
Partnerships, together with Applicant and its other
subsidiaries, would hold not more than 5 percent of
any class of voting securities of any issuer, 7 and not
more than 25 percent of the total equity of any
issuer. 8 All such equity investments would be held in
accord with section 4(c)(6) of the BHC Act and
section 225.22(c)(5) of the Board's Regulation Y. See
12 U.S.C. § 1843(c)(6); 12 C.F.R. 225.22(c)(5).
Company also proposes to privately place limited
partnership interests with new investors, and might
form similar additional Partnerships in the future.9
3. These subsidiary banks are: Meridian Bank, Reading, Pennsylvania; Delaware Trust Company, Wilmington, Delaware; and Meridian Bank, New Jersey, Cherry Hill, New Jersey.
4. The Partnerships are not registered as investment companies
under the Investment Company Act of 1940 (15 U.S.C. § 80a-l et seq.)
("Investment Company Act"). Each Partnership is limited to not
more than 100 investors.
5. Because the Partnerships would be subsidiaries of Applicant,
Applicant must, for regulatory purposes, present financial information
relating to Company and the Partnerships on a consolidated basis.
6. The Partnerships will not invest in futures contracts or options on
futures contracts on any financial or non-financial commodity, or
knowingly invest in debt that is in default at the time of acquisition,
without prior approval from the Federal Reserve System. In addition,
Applicant has committed not to use the investments of the Partnerships to obtain or exercise control over any issuer of securities owned
or held by the Partnerships, and that no directors, officers, or
employees of Applicant and its affiliates will serve as directors,
officers, or employees of any issuer of which Applicant and its
affiliates hold more than 10 percent of the total equity.
7. The Partnerships currently hold interests in excess of 5 percent in
three real estate investment trusts, the excess amounts of which
Applicant must cause the Partnerships to divest within two years of
the date of this order.
8. Applicant has committed that all subordinated debt of an issuer
will be subject to this 25 percent limit.
9. Company would privately place limited partnership interests only
with sophisticated, institutional customers, as defined in section
225.2(g) of the Board's Regulation Y (12 C.F.R. 225.2(g)) and with
additional persons approved by the Board in previous orders. See
Manufacturers Hanover Corporation, 73 Federal Reserve Bulletin 930
737
Applicant has committed that the private placement of
limited partnership interests would conform with the
conditions and limitations in the Board's previous
orders approving private placement activities.10 Applicant is not seeking authority to engage in the private
placement of any securities other than limited partnership interests in the Partnerships.11
Financial Factors, Managerial Resources, and Other
Considerations
In order to approve this application, the Board must
determine that the performance of the proposed activities by Applicant can reasonably be expected to
produce public benefits that would outweigh possible
adverse effects under the proper incident to banking
standard of section 4(c)(8) of the BHC Act. In every
case under section 4 of the BHC Act, the Board must
determine the financial condition and resources of the
applicant and its subsidiaries and the effect of the
proposal on these resources.12 Based on the facts of
this case, the Board concludes that the financial considerations are consistent with approval of this application. The managerial resources of Applicant also are
consistent with approval.
The Board expects that the de novo entry of Applicant into the market for the proposed services would
(1987); The Toronto-Dominion Bank, 76 Federal Reserve Bulletin 573
(1990). Company may not place debt securities issued by the Partnerships with any person without prior approval from the Federal
Reserve System.
10. See J.P. Morgan & Company Incorporated, 76 Federal Reserve
Bulletin 26 (1990); Bankers Trust New York Corporation, 75 Federal
Reserve Bulletin 829 (1989). Applicant proposes to continue Company's practice of permitting an existing investor in a Partnership to
add to its investment in that Partnership in any amount, and would
permit an investor with $250,000 or more under management by
Company to invest in any Partnership in any amount. The Board has
previously imposed a large minimum denomination requirement
($100,000) on private placement activities to ensure that it is unlikely
that the general public would be buyers of such securities. The Mitsui
Taiyo Kobe Bank, Limited, 77 Federal Reserve Bulletin 116, 118 fn. 9
(1991). In this case, the Board believes that, because Company would
require that each investor initially invest at least $100,000, the
conditions under which Company would accept additional investments of less than $100,000 continue to impose adequate safeguards
against public participation in the placement of limited partnership
interests.
11. Company also proposes to exercise investment discretion on
behalf of a small number of individuals related to Company's president. The Board has not generally authorized bank holding companies
to exercise investment discretion except on behalf of institutional
customers or through a trust company. Because of the limited number
of individuals involved, their connection with the president of Company, and the fact that the president of Company has provided this
service to these individuals for several years, this proposal does not
raise the concerns that would be raised if discretionary investment
services were offered on a retail basis.
12. 12 C.F.R. 225.24; The Fuji Bank, Limited, 75 Federal Reserve
Bulletin 94 (1989); Bayerische Vereinsbank AG, 73 Federal Reserve
Bulletin 155 (1987).
738
Federal Reserve Bulletin • August 1994
provide added convenience to Applicant's customers,
and would increase the level of competition among
existing providers of investment advisory services. To
address the potential adverse effects of its performance of the proposed activities, Applicant has committed to conduct the proposed activities subject to a
number of restrictions concerning extensions of credit,
disclosures, marketing, conflicts of interests, and unfair competition.
Based on the commitments made by Applicant
regarding its conduct of the proposed activities, the
limitations noted in this order, and all the facts of
record, the Board has determined that the performance of the proposed activities by Applicant could
reasonably be expected to produce public benefits that
would outweigh the possible adverse effects under the
proper incident to banking standard of section 4(c)(8)
of the BHC Act.
Based on the foregoing and all the facts of record,
the Board has determined to, and hereby does, approve the application subject to all the terms and
conditions set forth in this order, and in the abovenoted Board regulations and orders. The Board's
determination is also subject to all of the terms and
conditions set forth in the Board's Regulation Y,
including those in sections 225.4(d) and 225.23(b), and
the Board's authority to require modification or termination of the activities of a bank holding company or
any of its subsidiaries as it finds necessary to assure
compliance with, and to prevent evasion of, the provisions of the BHC Act and the Board's regulations
and orders issued thereunder. The Board's decision is
specifically conditioned on compliance with all the
commitments made in this application, including the
commitments discussed in this order and the conditions set forth in this order and in the above-noted
Board regulations and orders. These commitments and
conditions shall be deemed to be conditions imposed
in writing by the Board in connection with its findings
and decisions, and may be enforced in proceedings
under applicable law.
This transaction shall not be consummated later
than three months after the effective date of this order,
unless such period is extended for good cause by the
Federal Reserve Bank of Philadelphia, pursuant to
delegated authority.
By order of the Board of Governors, effective
June 28, 1994.
Voting for this action: Chairman Greenspan and Governors
LaWare, Lindsey, and Phillips. Absent and not voting:
Governor Kelley.
JENNIFER J. JOHNSON
Associate Secretary of the Board
Orders Issued Under Sections 3 and 4 of the
Bank Holding Company Act
Banc One Corporation
Columbus, Ohio
Order Approving the Acquisition of a Bank Holding
Company
Banc One Corporation, Columbus, Ohio ("Banc
One"), a bank holding company within the meaning of
the Bank Holding Company Act ("BHC Act"), has
applied for the Board's approval under section 3 of the
BHC Act (12 U.S.C. § 1842) to acquire Liberty National Bancorp, Inc., Louisville, Kentucky ("Liberty
National"), and thereby indirectly acquire Liberty
National's subsidiary banks in Kentucky and Indiana.1
Banc One also has applied under section 4(c)(8) of the
BHC Act (12 U.S.C. § 1843(c)(8)) to acquire the
nonbanking subsidiaries of Liberty National. The Liberty National subsidiaries to be acquired in this proposal are listed in the appendix.
Notice of the applications, affording interested persons an opportunity to submit comments, has been
published (59 Federal Register 11,605 (1994)). The
time for filing comments has expired, and the Board
has considered the applications and all comments
received in light of the factors set forth in sections 3(c)
and 4(c)(8) of the BHC Act.
Banc One, with total deposits of $61.1 billion, controls subsidiary banks in Ohio, Indiana, Michigan,
Wisconsin, Illinois, Texas, Colorado, Kentucky, West
Virginia, Arizona, California, Oklahoma, and Utah.
Upon consummation of the proposal, Banc One would
become the largest commercial banking organization
in Kentucky, controlling $5.1 billion in deposits, representing 14.8 percent of the total deposits in commercial banking organizations in the state.2 In Indiana,
Banc One would remain the second largest commercial banking organization, controlling $6 billion in
deposits, representing 12.2 percent of the total deposits in commercial banking organizations in the state.
Douglas Amendment
Analysis
Section 3(d) of the BHC Act, the Douglas Amendment, prohibits the Board from approving an application by a bank holding company to acquire control of
any bank located outside of the bank holding com-
1. In connection with this application, Banc One has requested
approval to acquire an option to purchase up to 17 percent of the
voting shares of Liberty National. This option will terminate upon
consummation of this proposal.
2. State deposit data are as of December 30, 1993.
Legal Developments
pany's home state, unless such acquisition is "specifically authorized by the statute laws of the State in
which such bank is located, by language to that effect
and not merely by implication."3 For purposes of the
Douglas Amendment, Banc One's home state is Ohio.
The Board previously has determined that the interstate statutes of Kentucky and Indiana permit a bank
holding company located in Ohio to acquire banking
organizations in those states.4 Based on all the facts of
record, the Board has determined that its approval of
this proposal is not prohibited by the Douglas Amendment. Approval of this proposal is conditioned upon
Banc One receiving all required state regulatory approvals.
Competitive
Considerations
Banc One and Liberty National compete directly in
the Lexington, Kentucky, and Cincinnati, Ohio, banking markets.5 Banc One is the largest depository
institution in the Lexington market, controlling
$1.1 billion in deposits, representing 31 percent of the
total deposits in depository institutions in the market
("market deposits"). 6 Liberty National is the fifth
largest depository institution in the market, controlling
$201.5 million in deposits, representing 5.7 percent of
market deposits. Upon consummation of this proposal, Banc One would control $1.3 billion in deposits,
representing 36.5 percent of market deposits. The
Herfindahl-Hirschman Index ("HHI") for the market
3. 12 U.S.C. § 1842(d). A bank holding company's home state is that
state in which the operations of the bank holding company's banking
subsidiaries were principally conducted on July 1, 1966, or the date on
which the company became a bank holding company, whichever is
later.
4. See Banc One Corporation, 78 Federal Reserve Bulletin 699
(1992) (acquisition of Kentucky banks by Ohio bank holding companies); Banc One Corporation, 72 Federal Reserve Bulletin 422 (1988)
(acquisition of Indiana banks by Ohio bank holding companies).
Under Kentucky law, each bank to be acquired must have been in
existence for at least five years, and the proposed transaction must not
result in the acquiring organization controlling more than 15 percent of
total deposits held by depository institutions in Kentucky. Ky. Rev.
Stat. Ann. § 287.900(2) and (3). Each of Liberty National's subsidiary
banks has been in existence for five years, and upon consummation of
this proposal, Banc One would control approximately 11.9 percent of
the total deposits in depository institutions in Kentucky.
5. The Lexington, Kentucky, banking market is approximated by
the counties of Bourbon, Clark, Fayette, Jessamine, Powell, Scott and
Woodford, all in Kentucky. The Cincinnati, Ohio, banking market is
approximated by Dearborn County, Indiana; Boone, Campbell,
Grant, Kenton, and Pendleton Counties in Kentucky; Clarmont and
Hamilton Counties in Ohio, and parts of Brown, Butler and Warren
Counties in Ohio.
6. In this context, depository institutions include commercial banks,
savings banks, and savings associations. Market deposit data are as of
June 30, 1993, and are based on calculations in which the deposits of
thrift institutions are included at 50 percent. The Board previously has
indicated that thrift institutions have become, or have the potential to
become, major competitors of commercial banks. See WM Bancorp,
76 Federal Reserve Bulletin 788 (1990); National City Corporation,
70 Federal Reserve Bulletin 743 (1984).
739
would increase by 349 points to 1672.7 Banc One has
committed to divest two branches in this market to
mitigate any potential anti-competitive effects of this
proposal, and with these divestitures, Banc One would
control 34.7 percent of market deposits and the HHI
would increase by 238 points to 1561.8 In the Cincinnati banking market, consummation of the proposal
would not exceed the Department of Justice merger
guidelines.9
In light of all the facts of record, including the
number of competitors remaining in the markets, the
increase in market share and market concentration as
measured by the HHI, and the proposed divestitures,
the Board concludes that consummation of the proposal would not have a significantly adverse effect on
competition in the Lexington and Cincinnati banking
markets or any relevant banking market.
Convenience and Needs
Considerations
In acting upon an application to acquire a depository
institution under the BHC Act, the Board must consider the convenience and needs of the communities to
be served, and take into account the records of the
relevant depository institutions under the Community
Reinvestment Act (12 U.S.C. § 2901 et seq.)
("CRA"). The CRA requires the federal financial
supervisory agencies to encourage financial institutions to help meet the credit needs of the local communities in which they operate, consistent with the
safe and sound operation of such institutions. To
accomplish this end, the CRA requires the appropriate
federal supervisory authority to "assess the institution's record of meeting the credit needs of its entire
7. Under the revised Department of Justice Merger Guidelines, 49
Federal Register 26,823 (June 29, 1984), a market in which the
post-merger HHI is between 1000 and 1800 is considered moderately
concentrated. The Justice Department has informed the Board that a
bank merger or acquisition generally will not be challenged (in the
absence of other factors indicating anti-competitive effects) unless the
post-merger HHI is at least 1800 and the merger increases the HHI by
200 points. The Justice Department has stated that the higher than
normal HHI thresholds for screening bank mergers for anti-competitive effects implicitly recognize the competitive effect of limitedpurpose lenders and other non-depository financial entities.
8. Banc One has executed an agreement to sell the two branches in
the Lexington banking market to a bank holding company that
currently operates in the market and has committed to complete these
divestitures within 180 days of consummation of the transaction. Banc
One also has committed that, in the event it is unsuccessful in
completing these divestitures within 180 days of consummation of the
proposal, it will transfer the relevant office or offices to an independent
trustee with instructions to sell the office or offices promptly. See
BankAmerica Corporation, 78 Federal Reserve Bulletin 337, 340
(1992); and United New Mexico Financial Corporation, 11 Federal
Reserve Bulletin 484, 485 (1991).
9. In the Cincinnati banking market, Banc One would become
the fifth largest depository institution in the market, controlling
$909.7 million in deposits, representing 4.8 percent of market deposits. The HHI for the market would increase by 10 points to 1221.
740
Federal Reserve Bulletin • August 1994
community, including low- and moderate-income
neighborhoods, consistent with the safe and sound
operation of such institution," and to take that record
into account in its evaluation of bank holding company
applications.10
The Board has received comments from several
organizations and an individual on this proposal.
Three community-based organizations and an individual in Kentucky commented in favor of the proposal,
commending Liberty National's commitment to affordable housing in Louisville, and its development of
lending programs for minority and low- and moderateincome borrowers. The Board also received comments
opposing the proposal, including comments from the
National Community Reinvestment Network representing several organizations ("Protestants"). Protestants allege, on the basis of data filed under the Home
Mortgage Disclosure Act ("HMDA") (12 U.S.C.
§ 2801 et seq.), that Banc One and Liberty National
have engaged in discriminatory lending practices
against African-Americans in housing-related loans,
and that both institutions have failed to meet the credit
needs of minority-owned small businesses.11 Protestants further allege that the two organizations have a
poor record of marketing and outreach to the AfricanAmerican community.
The Board has carefully reviewed the CRA performance records of Banc One, Liberty National, and
their respective subsidiary banks, as well as all comments received regarding these applications, Banc
One's responses to those comments, and all other
relevant facts of record in light of the CRA, the
Board's regulations, and the Statement of the Federal
Financial Supervisory Agencies Regarding the Community Reinvestment Act ("Agency CRA Statement"). 12
factor in the consideration of an institution's CRA
record and that these reports will be given great weight
in the applications process. 13 Banc One's lead subsidiary bank in Ohio, Bank One, Columbus, N.A. ("Bank
One - Columbus"), received an "outstanding" rating
from the Office of the Comptroller of the Currency
("OCC") at its most recent examination for CRA
performance as of April 28, 1993. In addition, all but
one of Banc One's remaining 80 subsidiary banks that
have been examined for CRA performance received
either "outstanding" or "satisfactory" ratings from
their primary regulators in the most recent examinations of their CRA performance.14
Liberty National's lead bank, Liberty National of
Louisville ("Liberty Bank - Louisville"), received an
"outstanding" rating from its primary regulator, the
OCC, at its most recent examination for CRA performance as of August 31,1992. In addition, all of Liberty
National's remaining six subsidiary banks that have
been examined for CRA performance received either
"outstanding" or "satisfactory" ratings from their
primary regulators in the most recent examinations of
their CRA performance.15
In connection with several recent applications, the
Board has reviewed in detail the performance ratings
of Banc One's subsidiary banks in light of Banc One's
corporate CRA policies. 16 For the reasons more fully
stated in those orders, which are incorporated by
reference, the Board has found that these policies have
substantively contributed to the satisfactory or better
CRA performance evaluations achieved by almost all
of Banc One's subsidiary banks. Following consummation of this proposal, Banc One will integrate Liberty National completely into its community reinvestment program, and each Liberty National subsidiary
bank will adopt Banc One's CRA policies to enhance
its CRA programs.
Records of Performance Under the CRA
A. Evaluations of CRA Performance
The Agency CRA Statement provides that a CRA
examination is an important and often controlling
10. 12 U.S.C. § 2903.
11. Protestants's comments relate to the Ohio subsidiary banks of
Banc One in Columbus, Cincinnati, Cleveland and Akron, and Liberty
National's subsidiary banks in Louisville and Erlanger, both in
Kentucky, and in Charlestown, Indiana. Protestants also maintain
that there is insufficient information about the specific CRA activities
of Banc One to support approval, including a lack of information about
Banc One's charitable contributions and the ethnic composition of its
^mall-business and consumer-loan applicants. Protestants have also
requested that the Board make a referral to the Department of Justice,
and have indicated that they filed their comments on these applications with the Department of Justice on March 31, 1994.
12. 54 Federal Register 13,742 (1989).
13. Id. at 13,745 (1989). Protestants disagree with the CRA performance evaluations of Banc One and Liberty National's subsidiary
banks by federal banking supervisors, and allege that these evaluations are contrary to relevant lending data.
14. In this regard, Bank One, Akron, N.A. ("Bank One - Akron")
was assigned a rating of "satisfactory" by the OCC as of February 26,
1993; and Bank One, Cincinnati, N.A. ("Bank One - Cincinnati") was
assigned a rating of "satisfactory" by the OCC as of July 20,1993. The
OCC assigned a rating of "needs to improve" to Bank One, Cleveland, N.A. ("Bank One - Cleveland") as of April 12, 1993. As
discussed in this order, Banc One has taken corrective steps to
improve the CRA performance of this bank.
15. In this regard, Liberty National Bank of Indiana ("Liberty BankIndiana") was assigned a rating of "outstanding" by the OCC as of
May 31, 1993; and Liberty National Bank of Northern Kentucky
("Liberty Bank - Northern Kentucky") was assigned a rating of
"satisfactory" by the OCC as of August 31, 1992.
16. Banc One Corporation (FirsTier), 79 Federal Reserve Bulletin
1168 (1993) ("the FirsTier Order"); see also Banc One Corporation
(Valley National Corporation), 79 Federal Reserve Bulletin 524 (1993)
("the Valley National Order").
Legal Developments
B. H M D A Data
Protestants allege that data required to be filed under
the HMDA show that Banc One's subsidiary banks in
Columbus, Cincinnati, Cleveland and Akron, and Liberty Bank - Louisville, Liberty Bank - Indiana and
Liberty Bank - Northern Kentucky, discriminate
against African-Americans in the provision of home
purchase mortgage and refinancing loans.17 In particular, Protestants contend that the disparities shown in
the 1992 data in the number of loan applications from
and originations to African-Americans, and in the
denial rates for African-Americans, when compared to
white borrowers indicate illegal discriminatory practices.
In some categories, the HMDA data for 1992 indicate that these Banc One and Liberty National banks
are lending at a level that meets or exceeds their peers.
For example, HMDA-reported loan originations by
Banc One's Ohio subsidiaries to African-Americans in
1992, as a percentage of total loans originated by these
banks, exceeds the aggregate percentage of loans
made to African-Americans by peer organizations.
Furthermore, the data indicate an increase from 1992
to 1993 in the number of HMDA-reported loan applications received from African-Americans by Banc
One's four subsidiary banks, as well as an increase in
the number of originations to this group.18 However,
both the 1992 and 1993 data show a low number of
housing-related loans to African-Americans, and disparities in the declination rates for African-Americans
compared to white applicants at the subsidiary banks
of both Banc One and Liberty National.19
17. Protestants also have criticized Liberty National Bank of
Lexington, Lexington, Kentucky, for its lack of lending and outreach
to African-Americans. That bank, which was assigned a rating of
"satisfactory" by the OCC at its most recent examination for CRA
performance as of June 30, 1992, was merged into Liberty
Bank - Louisville on October 1, 1993.
18. For example, from 1992 to 1993, the number of loan applications
from African-Americans increased from 1736 to 2232, and the number
of originations increased from 772 to 901.
19. Protestants requested that the Board delay action until the
Federal Reserve System has conducted a comprehensive study of the
home lending practices of the subsidiary banks of Banc One and has
conducted an audit of the number and dollar amount of small-business
loans and contracts awarded to African-Americans by these banks.
Protestants also requested additional time to analyze the 1993 HMDA
data or, in the alternative, that the Board not use the data in its
analysis of this case. In addition, Protestants requested that the Board
not act on these applications until the two vacancies on the Board
have been filled.
The Board has carefully reviewed substantial information relating to
the CRA performance of Banc One and Liberty National in this case,
including data relating to small-business lending. The Board provided
Protestants with a substantial comment period of approximately 98
days, including a 14-day extension of the comment period to submit
additional comments and analysis of these applications. Protestant did
submit substantial written comments on this case. Based on all the
facts of record, including the substantial comments that have been
741
The Board is concerned when an institution's record
indicates disparities in lending to minority applicants
and believes that all banks are obligated to ensure that
their lending practices are based on criteria that assure
not only safe and sound lending, but also assure equal
access to credit by creditworthy applicants regardless
of race. The Board recognizes, however, that HMDA
data alone provide only a limited measure of any given
institution's lending in its community. The Board also
recognizes that HMDA data have limitations that
make the data an inadequate basis, absent other information, for conclusively determining whether an institution has engaged in illegal discrimination in making
lending decisions.
The most recent OCC examinations for CRA compliance and performance of Banc One's subsidiary
banks in Columbus, Cincinnati, Cleveland and Akron
found no evidence of illegal discrimination or other
illegal credit practices. Examiners also found no evidence of any practices or procedures that would
discourage applications for available credit from any
segment of the delineated communities of these
banks.20 Moreover, these examinations indicate generally that the geographic distribution of each institution's credit extensions, applications, and denials reflect reasonable penetration in all segments of their
delineated communities, including low- and moderateincome areas.21 In addition, Banc One has taken steps
to ensure that all loan decisions are made in accordance with fair lending laws. For example, compliance
officers at Bank One - Columbus and Bank One Cincinnati periodically review files of approved and
denied consumer loan applications as part of the
corporate compliance program to ensure that the
banks' loan process is conducted on a nondiscriminatory basis.
The most recent OCC examinations for CRA compliance and performance of Liberty Bank - Louisville,
Liberty Bank - Indiana and Liberty Bank - Northern
Kentucky also found no evidence of illegal discrimi-
submitted by Protestants, the Board does not believe a further delay
in acting on these applications is warranted.
20. Protestants allege that Banc One's subsidiary banks prescreened
minority applicants and thereby have been able to lower their denial
rates. The OCC found in its 1993 CRA examinations that each bank
has adopted policies, procedures, and training programs to preclude
illegal credit practices. Periodic self-assessments are also performed
at several of the banks to assure the adequacy of these policies,
procedures and programs.
21. The OCC's 1993 examination of Banc One - Akron found a low
number of home purchase applications from minority applicants in
1991. The OCC noted that bank lenders were working with area
realtors and a neighborhood organization to increase the number of
minority applicants and that the bank adopted a revised marketing
plan in 1993 to increase applications from minorities.
742
Federal Reserve Bulletin • August 1994
nation or other illegal credit practices.22 In addition,
examiners found no evidence of any practices or
procedures that would discourage applications for
available credit from any segment of the delineated
communities of these banks. Liberty National's subsidiaries also have a second review process whereby
every recommended denial of a mortgage, small business or commercial loan application receives a second
review to insure that the recommendation is consistent
with fair lending laws.
Lending Programs of Subsidiary Banks. The FirsTier
Order noted that the lending programs at each of the
four Banc One subsidiary banks identified by Protestants offered a variety of credit products and services
designed to assist in meeting the credit needs of lowand moderate-income and minority neighborhoods,
and in particular inner-city neighborhoods, within
their delineated communities.23 The Board has carefully reviewed the lending programs of these banks in
light of Protestants' comments and the Board's previous assessment of the banks' lending activities.
Columbus. Bank One - Columbus offers a number of
direct and subsidized home-loan products through the
Community Home Buyers Program; the Ohio Housing
Finance Agency First Time Homebuyers Program;
and a variety of government-sponsored loan programs,
including programs through the Federal Housing Authority and the Veterans Administration. In addition,
from 1991 through the first quarter of 1993, the bank
made 1,627 small business loans totalling $61.5 million, $47 million of which were generated by branches
serving low- and moderate-income areas. Furthermore, as of December 31, 1993, the bank had 76
commercial loans and lines of credit totalling approximately $23 million outstanding to borrowers in census
tracts in the Columbus Metropolitan Statistical Area
("MSA") that had a minority population greater than
80 percent.
Cincinnati. Bank One - Cincinnati has introduced a
"Welcome Home" loan program designed to facilitate
home ownership for low- and moderate-income individuals by reducing down payment requirements and
closing costs, eliminating mortgage guaranty insurance, and employing flexible underwriting guidelines.
As of June 30, 1993, 131 applications had been ap-
proved under this program, including 22 from AfricanAmericans, for a total of approximately $7.8 million.
In addition, Bank One - Cincinnati generated 71 smallbusiness-loan applications from low- and moderateincome neighborhoods, and made 30 of these loans
during the first half of 1993. The bank had four
commercial loans and lines of credit totalling approximately $1 million outstanding to borrowers in census
tracts in the Cincinnati MSA that had a minority
population greater than 80 percent as of December 31,
1993.
Akron. Bank One - Akron has developed the "OwnA-Home Program," an affordable-housing loan product targeting low- and moderate-income individuals in
its delineated community. Through this program,
Bank One - Akron extended 77 loans totalling
$2.8 million in 1992. Bank One - Akron also extended
385 small business loans totalling $31.9 million in 1992,
and participates in various government-sponsored
loan programs. As of December 31, 1993, the bank had
20 commercial loans and lines of credit totalling approximately $2 million outstanding to borrowers in
census tracts in the Akron MSA that had a minority
population greater than 80 percent.
Cleveland. The Board previously has recognized
weaknesses in aspects of the CRA performance of
Bank One - Cleveland, and has considered Banc One's
efforts to improve its performance in these areas. In
approving Banc One's acquisition of Valley National
Corporation, the Board required Banc One to submit
to the Board, when delivered to the OCC, a copy of its
plan to address areas of concern in the CRA program
of Bank One - Cleveland, and to submit periodic
reports on the progress of this plan.24 The Board
believes that progress has been shown since the Valley
National acquisition to improve Bank One - Cleveland's CRA performance. For example, it has introduced several new loan products designed to meet the
credit needs of low- and moderate-income communities including:
(1) A home-mortgage product with low-downpayment requirements and flexible underwriting criteria;
(2) A mortgage-loan product that covers both acquisition and rehabilitation costs;
(3) A secured home-improvement loan product; and
(4) A mortgage loan for one-to-eight-unit rental
properties.25
22. The OCC noted some substantive technical violations relating to
HMDA reporting and fair lending laws at Liberty Bank - Louisville
and Liberty Bank - Northern Kentucky. The OCC has indicated that
management implemented appropriate corrective actions during the
examination.
23. See the FirsTier Order, supra, at 1170-72.
24. See the Valley National Order.
25. Banc One - Cleveland introduced its Home Buyer's Dream
program in May, 1993. This program has a low down payment
requirement, provides financing for closing costs and provides a
waiver of mortgage insurance. In the fourth quarter of 1993, Banc
One- Cleveland extended 77 loans for a total of $4.4 million under this
program. In the third and fourth quarters of 1993, Banc One -
C. Banc One's Record of Performance
Legal Developments
In addition, the bank recently opened a branch in
Fairfax, a low- and moderate-income neighborhood in
Cleveland. Finally, as of December 31, 1993, the bank
had 74 commercial loans and lines of credit totalling
approximately $11 million outstanding to borrowers in
census tracts in the Cleveland MSA that had a minority population greater than 80 percent.26
Ascertainment and Marketing. The Board noted in
the Valley National Order that Banc One affiliates
actively assess the credit and banking needs of their
local service areas. Each affiliate bank is responsible
for formulating and submitting to its board of directors
a strategic plan for identifying local banking needs.
Furthermore, each bank engages in direct communication with its service communities through interviews
with community leaders, the creation of community
advisory councils, and bank participation in community organizations.
Banc One's subsidiary banks market specific products by advertising on television and radio and in
print media. They also supplement corporate marketing materials to meet the individual needs of their
banking communities. For example, the OCC's 1993
examination found that Bank One - Columbus maintained and analyzed media demographics and market
circulation/coverage data in order to target specific
audiences. The examination found that the bank
consistently advertises in local newspapers, including minority publications, and advertises on radio
stations with large minority audiences. The bank also
holds seminars targeted at start-up, minority and
female-owned businesses. The OCC's 1993 examination of Banc One - Cincinnati found that the bank
attempts to reach low- and moderate-income neighborhoods through the use of door hangers, bus bench
advertisements, billboards, and advertisements in
publications and on radio stations with large low- and
moderate-income and minority audiences. The
bank's board of directors and senior management
periodically review internal analyses of the geographic distribution of the bank's products, and use
these analyses to evaluate marketing efforts in targeted geographic areas and to develop new products
to make credit more widely available.
In its 1993 examination of Banc One - Akron, the
OCC found that the bank had a comprehensive
program for ascertaining credit needs and that the
Cleveland made 30 home improvement loans, totalling $489,000, to
borrowers living in low- and moderate-income areas of the Cleveland
metropolitan area, under its home improvement loan program that has
a higher-than-usual debt-to-income ratio.
26. The Board will continue to monitor the progress of Banc OneCleveland in improving its CRA program, including reviewing progress reports that are submitted to the Federal Reserve Bank of
Cleveland on a regular basis.
743
bank advertised its products in low- and moderateincome communities and in a minority-owned newspaper. The OCC noted in its 1993 examination that
this bank had instituted a more aggressive marketing
plan in 1993 in response to a low level of home
mortgage applications from minorities in 1991 and
1992. Finally, the OCC's 1993 examination of Bank
One - Cleveland found that it adequately ascertains
the credit needs of its community, and that a significant portion of the bank's CRA marketing efforts
was devoted to targeted marketing through newsletters and programs sponsored by minority groups.
The bank advertises consistently in a newspaper
targeted to minorities, and on radio stations that have
a significant number of minority listeners.
D. Conclusion Regarding Convenience and
Needs Factors
The Board has carefully considered all the facts of
record, including the comments received, in reviewing the convenience and needs factors under the
BHC Act. Based on a review of the entire record of
performance, including information provided by
commenters supporting the proposal and the Protestants, and the CRA performance examinations by the
banks' primary regulators, the Board believes that
the efforts of Banc One and Liberty National to help
meet the credit needs of all segments of the communities served by their subsidiary banks are consistent
with approval of these applications. The Board concludes that convenience and needs considerations,
including the CRA performance records of the companies and banks involved in these proposals, are
consistent with approval of these applications.27
27. Protestants have requested that the Board hold a public meeting
or hearing on these applications. The Board is not required under
section 3(b) of the BHC Act to hold a hearing on an application unless
the appropriate banking authority for the bank to be acquired makes a
timely written recommendation of denial of the application. In this
case, neither the Kentucky Department of Financial Institutions nor
the Indiana Department of Financial Institutions has recommended
denial of this proposal.
Generally, under the Board's rules, the Board may, in its discretion,
hold a public hearing or meeting on an application to clarify factual
issues related to the application, and to provide an opportunity for
testimony, if appropriate. 12 C.F.R. 262.3(e) and 262.25(d). The Board
has carefiilly considered this request. In the Board's view, interested
parties have had a sufficient opportunity to present written submissions, and have submitted substantial written comments that have
been considered by the Board. On the basis of all the facts of record,
the Board has determined that a public meeting or hearing is not
necessary to clarify the factual record in these applications, or
otherwise warranted in this case. Accordingly, the request for a public
meeting or hearing on these applications is hereby denied.
744
Federal Reserve Bulletin • August 1994
Other Considerations
The financial and managerial resources and future
prospects of Banc One, Liberty National, and their
respective subsidiaries, and other supervisory factors
the Board must consider under section 3 of the BHC
Act, also are consistent with approval.28
Banc One also has applied, pursuant to section 4 of
the BHC Act, to acquire the nonbanking subsidiaries
of Liberty National that engage in consumer lending,
credit-related insurance, and certain securities-related
activities. The Board previously has determined that
these activities are permissible for bank holding companies under section 4(c)(8) of the BHC Act, the
Board's Regulation Y and prior Board orders, and
Banc One proposes to conduct these activities in
accordance with those regulations and orders. The
record in this case indicates that there are numerous
providers of these nonbanking services, and there is
no evidence in the record to indicate that consummation of this proposal is likely to result in any significantly adverse effects, such as undue concentration of
resources, decreased or unfair competition, conflicts
of interests, or unsound banking practices that would
outweigh the public benefits of this proposal. Accordingly, the Board has determined that the balance of
public interest factors it must consider under section
4(c)(8) of the BHC Act is favorable and consistent with
approval of Banc One's application to acquire Liberty
National's nonbanking subsidiaries.
225.4(d) and 225.23(b)(3) (12 C.F.R. 225.4(d) and
225.23(b)(3)), and to the Board's authority to require
such modification or termination of the activities of a
holding company or any of its subsidiaries as the
Board finds necessary to assure compliance with, or to
prevent evasions of, the provisions and purposes of
the BHC Act and the Board's regulations and orders
issued thereunder. The commitments and conditions
relied on by the Board in reaching this decision are
deemed to be conditions imposed in writing by the
Board in connection with its findings and decision,
and, as such, may be enforced in proceedings under
applicable law.
The acquisition of Liberty National's subsidiary
banks shall not be consummated before the thirtieth
calendar day following the effective date of this order,
and the acquisition of Liberty National's subsidiary
banks and nonbanking subsidiaries shall not be consummated later than three months after the effective
date of this order, unless such period is extended for
good cause by the Board or by the Federal Reserve
Bank of Cleveland, acting pursuant to delegated authority.
By order of the Board of Governors, effective
June 2, 1994.
Voting for this action: Chairman Greenspan and Governors
Kelley, LaWare, Lindsey, and Phillips.
JENNIFER J. JOHNSON
Associate Secretary of the Board
Conclusion
Based on the foregoing and other facts of record, the
Board has determined that the applications should be,
and hereby are, approved. The Board's approval is
expressly conditioned upon compliance with all the
commitments made by Banc One in connection with
these applications and with the conditions referred to
in this order, including obtaining all required state
approvals. The determinations as to the nonbanking
activities are also subject to all the conditions in the
Board's Regulation Y, including those in sections
28. Protestants have criticized the employment practices of both
institutions relating to minorities, including minority participation in
senior management, on boards of directors, and in third-party contracts. In this regard, the Board notes that, because Banc One and
Liberty National subsidiary banks employ more than 50 people and
act as an agent to sell or redeem U.S. savings bonds and notes, they
are required by Treasury Department and Department of Labor
regulations to:
(1) File annual reports with the Equal Employment Opportunity
Commission; and
(2) Have in place a written affirmative action program which states
their intentions, efforts, and plans to achieve equal opportunity in
the employment, hiring, promotion, and separation of personnel.
Appendix
Subsidiary Banks to be Acquired
(1) Liberty National Bank and Trust Company of
Kentucky, Louisville, Kentucky;
(2) Liberty National Bank of Owensboro, Owensboro,
Kentucky;
(3) Liberty National Bank and Trust Company of
Central Kentucky, Elizabethtown, Kentucky;
(4) Liberty National Bank of Northern Kentucky,
Erlanger, Kentucky;
(5) Liberty National Bank of Shelby ville, Shelbyville,
Kentucky;
(6) Liberty National Bank and Trust Company of
Indiana, Charlestown, Indiana; and
(7) Liberty National Bank of Western Kentucky,
Madison ville, Kentucky.
Nonbanking Subsidiaries to be Acquired
(1) Liberty Financial Services, Inc., Louisville, Kentucky, and thereby engage in consumer lending activities and the sale of credit-related insurance pursuant
Legal Developments
to sections 225.25(b)(1) and (8)(i) and (ii) of the
Board's Regulation Y; and
(2) Liberty Investment Services, Inc., Louisville,
Kentucky, and thereby engage in full-service securities brokerage services, riskless principal activities
and underwriting and dealing in bank-eligible and
ineligible securities pursuant to sections 225.25(b)(15)
and (16) of the Board's Regulation Y and prior Board
orders.
Financial Corporation of Louisiana
Crowley, Louisiana
Order Approving Formation of a Bank Holding
Company and Acquisition of Shares of a Bank
Holding Company
Financial Corporation of Louisiana, Crowley, Louisiana ("Financial"), has applied under section 3(a)(1) of
the Bank Holding Company Act ("BHC Act")
(12 U.S.C. § 1842(a)(1)) to acquire all the voting shares
of First National Bank of Crowley, Crowley, Louisiana ("Bank"), and thereby become a bank holding
company.1 Financial also has applied pursuant to
section 4(c)(8) of the BHC Act to acquire First Crowley Financial Corporation, Crowley, Louisiana ("First
Crowley"), and thereby engage in:
(1) Making and servicing loans pursuant to section
225.25(b)(1) of the Board's Regulation Y (12 C.F.R.
225.25(b)(1)); and
(2) Acting as principal, agent, or broker for creditrelated insurance pursuant to section 225.25(b)(8) of
Regulation Y (12 C.F.R. 225.25(b)(8)).2
Financial also has applied pursuant to section 3 of the
BHC Act to acquire 8.25 percent of the voting shares
of Progressive Bancorporation, Inc., Houma, Louisiana ("Progressive"), which are currently held by First
Crowley.3
1. This proposal represents a reorganization of current ownership
interests. Financial would acquire Bank by forming an interim national bank subsidiary ("Interim") and merging Bank into Interim
with Interim as the surviving institution under Bank's charter. First
Crowley would also merge with and into Financial, with Financial
surviving the merger.
2. First Crowley engages in real estate activities that are not
permissible for bank holding companies under the BHC Act. Financial
has committed that all impermissible real estate activities will be
divested or terminated within two years of consummation of the
proposal, that no new impermissible projects or investments will be
undertaken during this period, and that capital adequacy guidelines
will be met excluding specified real estate investments.
3. Principals of Financial own an additional 3.45 percent of the
voting shares of Progressive. Therefore, Financial would control
approximately 11.7 percent of the voting shares of Progressive upon
consummation of this proposal.
745
Notice of the applications, affording interested persons an opportunity to submit comments, has been
published (59 Federal Register 13,727 and 15,412
(1994)). The time for filing comments has expired, and
the Board has considered the application and all
comments received in light of the factors set forth in
sections 3 and 4 of the BHC Act.
Financial is a nonoperating corporation formed for
the purpose of becoming a bank holding company
through the acquisition of Bank. Bank is the 81st
largest commercial banking organization in Louisiana,
controlling deposits of approximately $59.2 million,
representing less than 1 percent of total deposits in
commercial banks in the state.4 Progressive is the 35th
largest commercial banking organization in Louisiana,
controlling deposits of approximately $118.9 million,
representing less than 1 percent of total deposits in
commercial banks in the state. Bank and Progressive
do not compete directly in any banking market. Accordingly, consummation of this proposal would not
have a significantly adverse effect on competition or
the concentration of banking resources in any relevant
banking market.
The Board has carefully reviewed comments from
the chairman of the board of Progressive's bank subsidiary ("Protestant"), Progressive Bank & Trust,
Houma, Louisiana ("Progressive Bank"), objecting to
Financial's acquisition of a minority interest in Progressive. Protestant alleges that this acquisition will
adversely affect Progressive's ability to raise capital
and serve the credit needs of its communities. Protestant also objects to the fact that Financial is located
outside of Progressive Bank's local community, and
asserts that dissimilarities between Progressive Bank
and Bank both in terms of asset size and marketing
strategies should preclude the acquisition of the Progressive interest.5 Financial maintains that its invest-
4. State deposit data are as of June 30, 1993.
5. Protestant questions whether Bank satisfied divestiture requirements in a timely manner in its disposition of Progressive stock
acquired in 1988 (less than 1 percent) and 1989 (8.25 percent) through
foreclosure on loans secured by such stock. Under the rules of the
Office of the Comptroller of the Currency regarding the acquisition of
securities in the course of securing a debt previously contracted, a
national bank has five years to divest of such shares. See Comptroller's Handbook for National Bank Examiners, Section 203.1 (February 1982). In 1992, Bank divested its interest in Progressive to First
Crowley. This transfer to First Crowley satisfied the divestiture
requirements of the BHC Act and the National Bank Act. The transfer
to First Crowley was not financed by debt to Bank, and the record
does not indicate that, following the transfer of shares to First
Crowley, Bank was able to control either the transferred shares or
Progressive itself. Although two shareholders of First Crowley also
owned shares of Progressive at the time of the divestiture, the record
does not indicate that these additional holdings permitted either First
Crowley or Bank to control Progressive. One of these shareholders
owns 1.5 percent of Progressive's voting shares; and the second
individual, who owns less than 5 percent of the shares of First
Crowley, owns an additional 1.9 percent of Progressive's voting
746
Federal Reserve Bulletin • August 1994
ment in Progressive is completely passive, and that it
has no intention of exercising or attempting to exercise
a controlling influence over the management or policies of Progressive or any of its subsidiaries.6
The Board has previously approved the acquisition
by a bank holding company of less than a controlling
interest in a bank, noting that "nothing in section 3(c)
of the Act requires denial of an application solely
because a bank holding company proposes to acquire
less than a controlling interest in a bank or bank
holding company." 7 The Board has also noted that the
requirement in section 3(a)(3) of the BHC Act that the
Board's prior approval be obtained before a bank
holding company acquires more than 5 percent of the
voting shares of a bank also suggests that Congress
contemplated the acquisition by bank holding companies of between 5 percent and 25 percent of the voting
shares of banks. For these reasons, the Board concludes that the purchase by Financial of less than a
controlling interest in Progressive is not a factor that,
by itself, justifies denial of this application.
As part of this proposal, Financial has made a
number of commitments to address concerns relating
to the effect that its acquisition of shares of Progressive would have on the management and operation of
Progressive Bank. In particular, Financial has committed that it will not, without the Board's prior approval:
(1) Exercise or attempt to exercise a controlling
influence over the management or policies of Progressive or any of its subsidiary banks;
(2) Have or seek to have any employees or representatives serve as an officer, agent, or employee of
Progressive or any of its subsidiary banks;
(3) Take any action causing Progressive or any of its
subsidiary banks to become a subsidiary of Applicant;
(4) Acquire or retain shares of Progressive that
would cause the combined interests of Financial and
its affiliates, officers, and directors to equal or exceed 25 percent of the outstanding voting shares of
Progressive;
(5) Propose a director or a slate of directors in
opposition to a nominee or slate of nominees proposed by the management or board of directors of
Progressive or its subsidiary banks;
(6) Attempt to influence the dividend policies or
practices of Progressive;
(7) Solicit or participate in soliciting proxies with
respect to any matter presented to the shareholders
of Progressive;
(8) Attempt to influence the loan and credit decisions or policies of Progressive or any of its subsidiary banks, the pricing of services, any personnel
decision, the location of any offices, branching, the
hours of operation, or similar activities of Progressive or any of its subsidiary banks;
(9) Dispose or threaten to dispose of shares of
Progressive in any manner as a condition of specific
action or nonaction by Progressive or any of its
subsidiary banks;
(10) Enter into any banking or nonbanking transactions with Progressive or any of its subsidiary
banks, except that Financial and its subsidiaries
may establish and maintain deposit accounts with
Progressive or subsidiary banks of Progressive, provided that the aggregate balance of all such deposit
accounts does not exceed $500,000, and provided
that the accounts are maintained on substantially the
same terms as those prevailing for comparable accounts of persons unaffiliated with Progressive; and
(11) Seek or accept representation on the board of
directors of Progressive or any of its subsidiary
banks.
shares. Moreover, Progressive is controlled by a chain banking
organization that owns 48.7 percent of its voting shares and that is
unaffiliated with First Crowley. Under these circumstances, First
Crowley's interest in Progressive does not meet any of the presumptions of control in the BHC Act or its implementing provisions in the
Board's Regulation Y, and the record does not indicate that First
Crowley has acted in concert with any other parties to control or
attempt to control Progressive. Accordingly, these comments do not
warrant denial of this application.
6. Protestant contends that Financial has rejected offers to purchase
the Progressive interest and believes that these actions indicate some
other motive in retaining this interest, including the sale of the stock
to a competitor of Progressive. Financial denies that it has rejected
any reasonable offers to purchase these shares. The Board notes that
Financial would not be able to acquire control of Progressive in the
future or sell its interest in Progressive to another bank holding
company without prior Board approval, and that the Board would at
that time re-examine the effects of the proposal under the factors set
forth in section 3(c) of the BHC Act after providing an opportunity for
public comment.
7. See United Counties Bancorporation, 75 Federal Reserve Bulletin 714 (1989); Midlantic Banks, Inc., 70 Federal Reserve Bulletin 776
(1984).
Based on the facts of record and Financial's commitments, the Board concludes that Financial would
not acquire control or the ability to exercise a controlling influence over the management or policies of
Progressive upon consummation of this proposal. On
this basis, the Board does not believe that the proposed retention of shares by Financial would impede
Progressive's ability to serve the needs of its community or raise capital as needed. For these reasons and
based on all facts of record, the Board concludes that
Protestant's comments do not warrant denial of these
applications. The Board also concludes that the financial and managerial resources and future prospects of
Financial and Bank and other supervisory factors that
the Board must consider under section 3 of the BHC
Act are consistent with approval of this proposal.
Considerations relating to the convenience and needs
Legal Developments
of the communities to be served also are consistent
with approval.
Financial also has applied pursuant to section 4(c)(8)
of the BHC Act to engage in making, acquiring, or
servicing loans or other extensions of credit and to
engage in credit insurance activities. The Board has
determined by regulation (12 C.F.R. 225.25(b)(1) and
(b)(8)(i» that these activities are closely related to
banking and permissible for bank holding companies
under section 4(c)(8) of the BHC Act. Financial proposes to conduct these activities pursuant to the
requirements of the Board's regulations. The record
does not indicate that consummation of this proposal
is likely to result in any significantly adverse effects,
such as undue concentration of resources, decreased
or unfair competition, conflicts of interests, or unsound banking practices that would not be outweighed
by the likely public benefits of this proposal. Accordingly, the Board has determined that the balance of
public interest factors it must consider under section
4(c)(8) of the BHC Act is favorable and consistent with
approval of Financial's application to acquire First
Crowley.
Conclusion
Based on the foregoing and other facts of record, the
Board has determined that the applications should be,
and hereby are, approved. The Board's approval is
expressly conditioned upon compliance with all the
commitments made by Financial in connection with
these applications, including the commitments discussed in this order. The determination as to the
nonbanking activities are subject to all of the conditions in the Board's Regulation Y, including those in
sections 225.4(d) and 225.23(b)(3) (12 C.F.R. 225.4(d)
and 225.23(b)(3)), and to the Board's authority to
require such modification or termination of the activities of a holding company or any of its subsidiaries as
the Board finds necessary to assure compliance with,
or to prevent evasions of, the provision and purposes
of the BHC Act and the Board's regulations and orders
issued thereunder. The commitments and conditions
relied on by the Board in reaching this decision are
deemed to be conditions imposed in writing by the
Board in connection with its findings and decision,
and, as such, may be enforced in proceedings under
applicable law.
The banking transactions shall not be consummated
before the thirtieth calendar day following the effective
date of this order, and the banking and nonbanking
transactions shall not be consummated later than three
months after the effective date of this order, unless
such period is extended for good cause by the Federal
747
Reserve Bank of Atlanta, acting pursuant to delegated
authority.
By order of the Board of Governors, effective
June 8, 1994.
Voting for this action: Governors Kelley, LaWare, Lindsey, and Phillips. Absent and not voting: Chairman
Greenspan.
JENNIFER J. JOHNSON
Associate Secretary of the Board
ACTIONS TAKEN UNDER THE FEDERAL DEPOSIT
INSURANCE CORPORATION IMPROVEMENT ACT
By the Board
NationsBank Corporation
Charlotte, North Carolina
Order Approving Applications to Acquire
of a Savings Bank
Branches
NationsBank Corporation, Charlotte, North Carolina
("NationsBank"), and its subsidiaries NationsBank of
Florida, N.A., Tampa, Florida ("NationsBankFlorida"), and NationsBank of Georgia, N.A., Atlanta, Georgia ("NationsBank-Georgia") (collectively, "Applicants"), propose to purchase certain assets
and assume certain liabilities of 44 branch offices of
California Federal Bank, F.S.B., Los Angeles, California ("CalFed"). These branches are located
throughout Florida and Georgia.1 Applicants seek
Board approval of this transaction pursuant to section
5(d)(3) of the Federal Deposit Insurance Act
(12 U.S.C. § 1815(d)(3) ("FDI Act")), as amended by
the Federal Deposit Insurance Corporation Improvement Act of 1991 (Pub. L. No. 102-242, § 501, 105
Stat. 2236, 2388-2392 (1991)).
Section 5(d)(3) of the FDI Act requires the Board to
review any proposed merger between a Savings Association Insurance Fund member and any Bank Insurance Fund ("BIF") member if the acquiring or resulting institution is a BIF insured subsidiary of a bank
holding company, and, in reviewing these proposals,
to follow the procedures and consider the factors set
forth in section 18(c) of the FDI Act (12 U.S.C.
§ 1828(c) ("the Bank Merger Act")). 2 The proposed
1. The branch locations that Applicants propose to acquire are listed
in the Appendix.
2. 12 U.S.C. § 1815(d)(3)(E). These factors include considerations
relating to competition, financial and managerial resources, and future
prospects of the existing and proposed institutions, and the conve-
748
Federal Reserve Bulletin • August 1994
transaction also is subject to review under the Bank
Merger Act by the Office of the Comptroller of the
Currency ("OCC"), the primary banking regulator for
NationsBank-Florida and NationsBank-Georgia.
Notice of the applications, affording interested persons an opportunity to submit comments, has been
given in accordance with the Bank Merger Act and the
Board's Rules of Procedure (12 C.F.R. 262.3(b)). Reports on the competitive effects of the merger were
requested from the United States Attorney General,
the Office of the Comptroller of the Currency
("OCC"), and the Federal Deposit Insurance Corporation. The time for filing comments has expired, and
the Board has considered the applications and all
comments received in light of the factors set forth in
the Bank Merger Act and section 5(d)(3) of the FDI
Act.
NationsBank,
with consolidated
assets
of
$159.7 billion, controls 11 banks in Delaware, the
District of Columbia, Florida, Georgia, Kentucky,
Maryland, North Carolina, South Carolina, Tennessee, Texas, and Virginia.3 NationsBank is the fourth
largest depository institution in Florida, controlling
total deposits of $15.1 billion, representing approximately 11.1 percent of total deposits in depository
institutions in the state.4 The Florida branch offices of
CalFed that Applicants propose to acquire control
deposits of $4.1 billion, representing 1.5 percent of
total deposits in depository institutions in Florida.
Upon consummation of the proposed transaction,
NationsBank would become the third largest depository institution in Florida, controlling deposits of
$19.2 billion, representing 13.9 percent of total deposits in depository institutions in the state.
NationsBank is the largest depository institution in
Georgia, controlling total deposits of $8.1 billion,
representing approximately 13 percent of total deposits in depository institutions in the state. The Georgia
branch office of CalFed that Applicants propose to
acquire controls deposits of $43.2 million, representing
less than 1 percent of total deposits in depository
nience and needs of the communities to be served. 12 U.S.C.
§ 1828(c).
3. Asset data are as of December 31, 1993.
4. Deposit and market data are as of June 30, 1993. In this context,
depository institutions include commercial banks, savings banks, and
savings associations. Market share data before consummation are
based on calculations in which the deposits of thrift institutions are
included at 50 percent. The Board previously has indicated that thrift
institutions have become, or have the potential to become, significant
competitors of commercial banks. See WM Bancorp, 76 Federal
Reserve Bulletin 788 (1990); National City Corporation, 70 Federal
Reserve Bulletin 743 (1984). Because the deposits of CalFed would be
transferred to a commercial bank under this proposal, those deposits
are included at 100 percent in the calculation of pro forma market
share. See Norwest Corporation, 78 Federal Reserve Bulletin 452
(1992); First Banks, Inc., 76 Federal Reserve Bulletin 669 (1990).
institutions in Georgia. Upon consummation of the
proposed transaction, NationsBank would remain the
largest depository institution in Georgia, controlling
deposits of $8.2 billion, representing approximately
13 percent of total deposits in depository institutions in
the state.
NationsBank and CalFed compete directly in the
Eastern Palm Beach County, Fort Meyers, MiamiFort Lauderdale, Sarasota, and Tampa Bay, Florida
banking markets, and the Atlanta, Georgia banking
market. Upon consummation of this proposal, all of
these banking markets would remain unconcentrated
or moderately concentrated as measured by the
Herfindahl-Hirschman Index ("HHI"). 5 After considering the competition offered by other depository
institutions in the market, the number of competitors
remaining in the market, the relatively small increase
in concentration as measured by the HHI, 6 and all
other facts of record, the Board concludes that consummation of the proposal would not result in a
significantly adverse effect on competition in any
relevant banking market.
Convenience and Needs
Considerations
The Board also is required under section 5(d)(3) of the
FDI Act to consider the effect of the proposal on the
convenience and needs of the communities to be
served. The Board has reviewed the comments submitted to the Board by two organizations in Florida
("Florida Protestants") and one organization in Texas
("Texas Protestant") that are critical of the efforts of
NationsBank and its bank subsidiaries in meeting the
credit and banking needs of their entire communities,
including low- and moderate-income neighborhoods.7
5. Under the revised Department of Justice Merger Guidelines,
49 Federal Register 26,823 (June 29, 1984), a market in which the
post-merger HHI is less than 1000 is considered unconcentrated, and
a market in which the post-merger HHI is between 1000 and 1800 is
considered moderately concentrated. The Justice Department has
informed the Board that a bank merger or acquisition generally will
not be challenged (in the absence of other factors indicating anticompetitive effects) unless the post-merger HHI is at least 1800 and the
merger increases the HHI by more than 200 points. The Justice
Department has stated that the higher than normal HHI thresholds for
screening bank mergers for anticompetitive effects implicitly recognize the competitive effect of limited-purpose lenders and other
non-depository financial institutions.
6. The HHI would increase in these banking markets as follows:
Eastern Palm Beach (by 39 points to 922); Fort Meyers (by 36 points
to 1280); Miami-Fort Lauderdale (by 87 points to 610); Sarasota (by 49
points to 1550); Tampa Bay (by 103 points to 994); and Atlanta (by 3
points to 1140).
7. The Florida Protestants are Florida Legal Services Inc., Tallahassee, Florida, commenting on behalf of The Farmworker Association of Florida, Springfield Preservation and Restoration, Inc., and
Neighborhood Housing Services of Jacksonville, Florida, Inc.; and
the Rural Law Center, Inc., Apopka, Florida, commenting on behalf
of itself and The Farmworker Association of Florida.
Legal Developments
The Florida Protestants allege that NationsBankFlorida has failed to meet a commitment to Florida
low-income community groups to support a proposed
multi-bank community development corporation, and,
as a result, is not meeting the credit needs of its entire
community.8 One of the Florida Protestants also alleges that the 1991 HMDA data for NationsBankFlorida and NationsBank's mortgage company subsidiary, NationsBank Mortgage Corporation, Dallas,
Texas, indicate that the bank and the mortgage company illegally discriminate against individuals living in
predominately African-American areas in Florida.
Texas Protestant alleges that NationsBank of Texas,
N.A., Dallas, Texas ("NationsBank-Texas") has discriminated against the Dalworth neighborhood in the
City of Grand Prairie, Texas, and similarly situated
banking markets in Texas. 9
The Board also has considered the record of performance of NationsBank and its subsidiaries under the
CRA and the programs that NationsBank has in place
to serve community needs in assessing the impact of
this proposal on the convenience and needs of the
communities to be served.
Record of Performance Under the CRA
A. Evaluations of CRA performance
The Board notes that all of NationsBank's subsidiary
banks received "satisfactory" ratings from their primary regulators during the most recent examinations
of their CRA performance. The bank subsidiaries
acquired in NationsBank's 1992 acquisition of C&S/
Sovran Corporation, Atlanta, Georgia, and Norfolk,
Virginia ("C&S/Sovran"), also received "satisfactory" ratings from their primary regulators during the
most recent examinations for their CRA performance.10 In addition, CalFed received a "satisfacto-
8. The Florida Protestants have filed similar protests with the OCC,
which will consider the comments as part of its review of the
transaction under the Bank Merger Act. The OCC approved the
acquisition of the Georgia branch on May 12, 1994.
9. Texas Protestant specifically alleges that NationsBank-Texas:
(1) Has failed to adequately market its credit products to AfricanAmerican neighborhoods and community based organizations;
(2) Has not developed lending programs that would provide financial services to low- and moderate-income individuals;
(3) Does not make a proportionate amount of business loans to
Dalworth residents;
(4) Has not developed a specific plan of action for serving the
residents and business owners in its community; and
(5) Discriminates in its operations, policies and procedures.
10. C&S/Sovran's subsidiary banks in Florida, Georgia, South
Carolina, Virginia, and Washington, D.C. received "satisfactory"
ratings for CRA performance from the OCC in October 1991. C&S/
Sovran's bank subsidiary in Tennessee received a "satisfactory"
rating for CRA performance from the Federal Reserve Bank of
Atlanta in September 1991, and its Kentucky bank subsidiary received
749
ry" rating from its primary regulator, the Office of
Thrift Supervision, in September 1992.
The Board also has taken into account NationsBank's progress under its commitment to initiate a
$10 billion/10 year Community Investment Program
("CIP").11 The CIP includes all the communities that
are served by NationsBank's subsidiaries, and lending
in the first two years of this program totalled
$5.1 billion, $2.9 billion of which was extended in
1993. In this regard, in 1993, NationsBank-Florida
originated 2,026 home mortgage and home improvement loans totalling $69.9 million in low- and moderate-income census tracts, and 1,323 home mortgage
and home improvement loans totalling $89.9 million to
minority applicants. Commercial real estate lending
under the CIP in Florida included 727 loans totalling
$185.7 million in 1993. In addition, with respect to
small business lending, NationsBank-Florida made
329 loans totalling $108 million to small businesses in
low- and moderate-income areas.
In addition, in 1993, NationsBank-Texas originated
2,430 home mortgage and home improvement loans
totalling $53.5 million in low- and moderate-income
census tracts, and 3,560 home mortgage and home
improvement loans totalling $98.3 million to minority
applicants. NationsBank-Texas also made 165 commercial loans totalling $101.7 million, for multi-family
housing units for low- and moderate-income individuals, and renovations for community and retail centers
in underserved areas. In addition, NationsBank-Texas
made 1421 loans totalling $426.4 million to small
businesses in low- and moderate-income areas.12
B. NationsBank's CRA Performance in Florida
In addition to reviewing examination records of NationsBank's subsidiaries, the Board has carefully reviewed the CRA performance of NationsBank-Florida
in light of Florida Protestants' comments criticizing
NationsBank's CRA record in Florida. In particular,
Florida Protestants allege that NationsBank-Florida
withdrew its commitment to fund a proposed multibank community development corporation known as
the Florida Community Development Assistance Cor-
a "satisfactory" rating for CRA performance from the Federal Reserve Bank of St. Louis in March 1992.
11. In connection with NationsBank's application to acquire C&S/
Sovran, NationsBank committed to improve its CRA performance
record through the CIP. The Board noted in the C&S/Sovran order
that it would take NationsBank's efforts into account in future
acquisitions. See Statement by the Board of Governors of the Federal
Reserve System Regarding the Application by NCNB Corporation to
Acquire C&S/Sovran Corporation, 78 Federal Reserve Bulletin 141
(1992) ("C&S/Sovran Order").
12. These numbers reflect NationsBank's lending in the entire state
of Texas, including the Dallas-Fort Worth area.
750
Federal Reserve Bulletin • August 1994
poration ("FCDAC"), which would have provided
pre-development financing and technical assistance to
community-based development organizations that provide low-income housing.
The proposed FCDAC originally was supported by
Local Initiatives Support Corporation ("LISC"), a
national nonprofit community development organization. NationsBank-Florida provided LISC with funds
that were held in escrow for the project. According to
NationsBank, however, the effort to create FCDAC
failed because of the lack of sufficient additional funding from other sources. As a result, by late 1989, LISC
had withdrawn from the project and the escrowed
funds were returned to the bank. NationsBank-Florida
subsequently participated in efforts to develop a revised FCDAC, but concluded in early 1993 that the
objectives of FCDAC could be best met by the bank
through other community development activities in
Florida, including the efforts described below.
Technical Assistance. NationsBank-Florida has undertaken a number of measures to provide technical
assistance for community based organizations working
to develop affordable housing, small business owners,
and consumers. For example, over the past two and a
half years, NationsBank-Florida, in conjunction with
the State of Florida Housing Catalyst Program, has
funded the Florida Affordable Housing Resource
Primer, a guide to identifying and using the federal,
state, and local resources available for the delivery of
low-income housing in both urban and rural areas.13
The primer is scheduled for use as an educational aide
in the Affordable Housing Workshops administered by
Miami-Dade Community College and the State of
Florida Department of Community Affairs in the third
quarter of this year. NationsBank-Florida also recently established a Small Business Technical Assistance Program to provide information and direction to
entrepreneurs regarding starting and operating small
businesses. In addition, in 1993, in partnership with
the National Association for the Advancement of
Colored People ("NAACP"), NationsBank established a Community Development Resource Center in
Fort Lauderdale to provide technical assistance and
education to consumers and small business owners.
During the past year, loans in the amount of
13. The goal of the Resource Primer is to provide the most current
description of available housing programs and resources for affordable
housing financing from federal, state, local, and private sectors. The
primer will identify obstacles to effective resource utilization, describe
how to use multiple resources in an affordable housing project, and
will show how to "reinvent affordable housing delivery." The primer
will be supplemented by a series of statewide training sessions on
affordable housing, and will be distributed to community development
corporations, banks, public housing agencies, for-profit developers,
the Department of Housing and Urban Development, state agencies,
and local governments.
$1.5 million were extended as a result of this center.14
Community Development Activities. NationsBankFlorida also participates in a variety of projects that
support community development activities in providing housing for low- to moderate-income individuals.
For example, in 1994, pursuant to the NationsBank
Neighborhood Program, NationsBank-Florida established the East Tampa Initiative pursuant to which
NationsBank-Florida committed $5 million for housing
and small business initiatives. NationsBank-Florida
also has committed $7.5 million to a $50 million loan
pool to develop affordable housing through the Central
Florida Community Reinvestment Corporation, and
has committed an additional $5 million in mortgage
loans to low- and moderate-income families through
the Broward County Housing Finance Authority's
Lender's Program.15 As of April 1993, 13 loans totalling over $720,000 were extended under this program.
NationsBank-Florida also committed $16 million to
the 1st Housing Development Corporation multi-bank
$100 million lending pool for multi-family low-income
housing in Tampa.16 In addition, in August 1994, the
NationsBank Community Development Corporation is
scheduled to begin its first project in Florida, the
redevelopment of the former Augustine Quarters site
in Sarasota into 25 new single-family affordable
houses. The project is expected to generate
$1.6 million in permanent mortgages.
HMDA Data and Lending Practices. The Board has
carefully reviewed the 1992 and 1993 HMDA data
reported by NationsBank-Florida and NationsBank
Mortgage Corporation in light of Florida Protestants'
comments. These data indicate disparities in the rates
of housing-related loan applications, and in denials
that vary by racial and ethnic group in areas served by
NationsBank-Florida.
The Board is concerned when an institution's record
indicates disparities in lending to minority applicants
and believes that all banks are obligated to ensure that
their lending practices are based on criteria that assure
not only safe and sound lending, but also assure equal
access to credit by creditworthy applicants regardless
of race. The Board recognizes, however, that HMDA
data alone provide an incomplete measure of an institution's lending in its community, have limitations that
make the data an inadequate basis, absent other infor-
14. The center also instructed over 500 individuals in NationsBank's
Community Home Buyer Program.
15. NationsBank-Florida also has committed $430,000 to the Orlando Neighborhood Investment Corporation for a $1 million project
to develop a 26-unit low-income housing complex in the Parramore/
Heritage Area of the City of Orlando.
16. NationsBank-Florida also has committed $2.5 million toward
the creation of a $5 million loan program to enable businesses owned
by women and minorities to provide contractor services to the Greater
Orlando Aviation Authority.
Legal Developments
mation, for concluding that an institution has engaged
in illegal discrimination in making lending decisions.
In this regard, the Board notes that the 1991 CRA
performance examinations for NCNB National Bank
of Florida, Tampa, Florida, and C&S National Bank of
Florida, Fort Lauderdale, Florida, the predecessor
banks of NationsBank-Florida, found no evidence of
prohibited discrimination or other illegal credit practices. The examinations also found no evidence of
practices intended to discourage applications for the
types of credit listed in the banks' CRA statements. In
addition, NationsBank-Florida has two different
mechanisms in place to ensure that mortgage applications from low- to moderate-income applicants obtain
a fair review. First, NationsBank-Florida has initiated
a second review process under the NationsBank/
National Urban League Community Loan Review
Board Program. The purpose of the Loan Review
Boards is to offer a second review to any NationsBank
applicant who has been denied a home mortgage or
home improvement loan on a primary residence.17
Second, NationsBank-Florida has introduced a
"one-up review process" whereby all initially rejected
applications from low- to moderate-income individuals
for loans to purchase, refinance, or improve one-tofour family residences are referred to another loan
officer for a second review before the customer is
notified that the application has been declined.18
In addition, NationsBank-Florida participates in 48
credit programs focused on meeting the credit needs of
low- to moderate-income consumers in the areas of
affordable housing and small business. These programs include a commitment of $20.4 million for the
origination of low- to moderate-income single-family
housing loans, a $50 million commitment for multifamily affordable housing programs, and $3 million for
small business loan programs.
C. NationsBank's CRA Performance in Texas
The Board also has carefully reviewed the CRA performance of NationsBank-Texas in light of Texas
Protestant's comments criticizing NationsBank's
CRA.
Ascertainment and Marketing. NationsBank-Texas
has engaged in a variety of outreach efforts in order to
17. Loan Review Boards are comprised of one local Urban League
member and three community members selected by the local Urban
League and local NationsBank representatives. NationsBank-Florida
has instituted this program in Jacksonville, Fort Lauderdale, Orlando,
Miami, and Tampa, and will serve applicants throughout the State of
Florida.
18. The second loan officer is independent of the original loan
officer, and is charged with objectively reviewing all relevant information, and has final authority to approve or decline the applications.
751
ascertain the credit needs of the Dalworth area and
advertise its credit products to residents in the Dalworth area. These efforts include ongoing communications with the Grand Prairie Chapter of the NAACP,
a number of churches, and Texas Protestant. The bank
also offers Banking Basics classes through the Grand
Prairie office of the Dallas County Community Action
Committee.19 In addition, NationsBank-Texas advertises its credit products in a number of media designed
to reach low- and moderate-income residents of Dalworth. These media include Minority Opportunity
News, Dallas Weekly, Dallas Examiner, and KKDA
Radio, Grand Prairie.
With regard to Texas Protestant's assertion that
NationsBank-Texas does not have a "specific action
plan" for serving the Dalworth area, both the City of
Grand Prairie and the Dalworth neighborhood are
covered by the NationsBank-Texas' Dallas Market
Development Plan.20 Moreover, two specific goals of
the plan are increasing market share in low- to
moderate-income census tracts, and increasing market
share in predominately African-American areas.21
HMDA Data and Lending Practices. The Board has
carefully reviewed the 1992 and 1993 HMDA data
reported by NationsBank-Texas and NationsBank
Mortgage Corporation in light of Texas Protestant's
comments. These data indicate some disparities in the
rates of approvals and denials of loan applications
according to racial group in the Dallas-Fort Worth
Metropolitan Statistical Area ("MSA"). 22
The Board notes that the 1991 CRA performance
examination of NCNB National Bank of Texas, Dallas, Texas, now known as NationsBank of Texas,
N.A., found no evidence of prohibited discriminatory
19. Bank representatives also participate in meetings with numerous
organizations, and serve on the boards of directors of organizations
that serve low- and moderate-income neighborhoods. The President of
the Grand Prairie Banking Center, for instance, is President of the
Grand Prairie-based Quality of Life Foundation which provides funding for charitable causes, including the provision of affordable housing
for low-income families in Grand Prairie.
20. NationsBank prepares a "Market Development Plan" for each
of its largest markets. The plan covers all areas within a market,
including under-performing areas singled out for special attention
under a geographic action plan.
21. NationsBank-Texas has created area-specific action plans to
increase loan production in census tracts that it determines, based on
certain objective criteria, to be most in need of immediate attention.
For example, of the 1,016 low- to moderate-income census tracts
included in NationsBank-Texas' delineated community, only 158 were
designated as requiring a geographic action plan in 1993. NationsBank-Texas has not created a separate plan for the Dalworth area
because:
(1) Neither of the census tracts in which Dalworth is located meets
the bank's four-part eligibility requirement for a geographic action
plan, and
(2) The neighborhood is already covered by the Dallas Market
Development Plan.
22. Both Dalworth and Grand Prairie, Texas, are part of the
Dallas-Fort Worth MSA.
752
Federal Reserve Bulletin • August 1994
or other illegal credit practices at the bank, and noted
that the bank was in compliance with applicable fair
housing and fair credit laws and regulations. The 1991
examination also found no evidence of any practices
intended to discourage applications of the types of
credit set forth in the bank's CRA statement. In
addition, NationsBank-Texas has instituted a secondary review process under the NationsBank/National
Urban League Community Loan Review Board Program and a one-up review process similar to the one in
place at NationsBank-Florida.23
As noted above, NationsBank-Texas and NationsBank Mortgage Corporation actively promote their
housing-related credit products to low- to moderateincome individuals and minorities within the DallasFort Worth MSA. In this regard, in 1993, NationsBank-Texas and NationsBank Mortgage Corporation
originated 953 HMDA-reportable loans totalling
$31.2 million in low- to moderate-income census
tracts, and 395 HMDA-reportable loans totalling
$12.2 million to African-American applicants within
the Dallas-Fort Worth MSA. These loans represent a
significant increase in lending in low- to moderateincome areas and to African-Americans. In 1992,
NationsBank-Texas and NationsBank Mortgage Company originated 752 HMDA-reportable loans totalling
$28.8 million to low- to moderate-income individuals,
and 283 HMDA-reportable loans totalling $7.9 million
to African-Americans.24
In response to an ascertained need for affordable
mortgage products in Dalworth and other low- to
moderate-income areas of its community, NationsBank-Texas has developed two affordable housing
products specifically targeted to low- and moderateincome families and individuals. The first mortgage
product provides for a loan of up to 95 percent of the
value of a property with private mortgage insurance.
Borrowers who cannot make the minimum 5 percent
down payment from their own funds have the option of
providing a minimum of 3 percent from their own
funds and the remaining 2 percent of the down payment, and up to 3 percent of the loan amount in closing
costs, in the form of a gift from a relative, a grant from
a nonprofit organization or public entity, or an unsecured loan from NationsBank, a nonprofit organiza
23. The one-up review process and the Loan Review Board Program are available at both NationsBank-Texas and NationsBank
Mortgage Corporation.
24. With respect to lending in Dalworth, in particular, in 1993,
NationsBank-Texas and NationsBank Mortgage Company received
88 loan applications from Dalworth residents, 55 of which were
approved, resulting in 43 loan originations totalling $2%,000. Of the 43
loans extended in Dalworth, 22 were consumer loans and 21 were
financial product loans such as bank card and student loans.
tion, or a public entity.25 The second mortgage product
is similar to the first, but is only available to lowerincome applicants.26 This product provides for a loan
of up to 95 percent of the value of the property with no
requirement of private mortgage insurance. Under this
program, the borrower can contribute as little as $500
of the down payment, with the balance provided
through a public or nonprofit "soft second" mortgage,
grant or down payment assistance program, or a gift
from a relative. Both mortgage products provide distinct advantages to low- to moderate-income borrowers in that no underwriting fees are charged and both
loans require less cash from the customer than traditional mortgage products.27
With respect to business lending, NationsBankTexas participates in a variety of programs to meet the
small business needs of its community. For example,
in June 1992, NationsBank-Texas was approved as a
certified lender for The Business Consortium Fund
(the "Fund"), a minority development company of the
National Minority Supplier Development Council. The
Fund provides contract financing to certified minority
businesses across the country through a network of
local participating banks, Regional Minority Purchasing Councils, and Regional Minority Suppliers. Loans
up to a maximum of $500,000 each are available to
minority suppliers to finance specific transactions for
which the borrower has a contract or purchase order.
In addition, NationsBank-Texas actively participates
in government-insured loan programs such as those of
the Small Business Administration ("SBA"). In this
regard, in 1992, NationsBank-Texas originated 28
SBA loans totalling $5.4 million.2®
Community Development. NationsBank-Texas participates in a variety of projects that support commu-
25. To be eligible for this program, a borrower must have total
household income of less than or equal to 115 percent of the 1990
median income for the county or MSA, and must complete a homebuyer education class.
26. To be eligible for this program, the borrower must have total
household income of less than or equal to 80 percent of the 1990
median income of the county or MSA.
27. NationsBank-Texas also uses an application scorecard credit
model for low- to moderate-income applicants. The scorecard model
seeks to identify factors that are good predictors of payment performance for the low- to moderate-income segment of the population.
The approach takes into account the differences that exist between
low- to moderate-income applicants and higher-income applicants
with respect to factors which correlate with good payment performance. NationsBank forecasts that the use of the low- to moderateincome scorecard has increased its approval rate for low- to moderateincome applicants by two to three percentage points over the approval
rate that would be observed with a scorecard based on the general
population.
28. NationsBank-Texas also supports Texas small businesses
through the recent expansion of NationsBank's Small Business Lending Unit and participation in programs such as the Fort Worth
Economic Development Corporation and the Southern Dallas Development Corporation.
Legal Developments
nity development activities in providing housing for
low- to moderate-income individuals in the Dalworth
area. For example, in February 1994, NationsBankTexas was formally approved as a permanent financing
lender under The Grand Prairie Hope 3 Program to the
Dalworth area. The Grand Prairie Hope 3 Program is
Grand Prairie's implementation of a national matching
fund and grant program sponsored by the United States
Department of Housing and Urban Development to
promote home ownership by low- to moderate-income
families. The goal of this program is to make one-tofour family homes available for sale to low- to
moderate-income families and first-time homebuyers.
Under this program, the City of Grand Prairie Housing
and Community Development Department has to date
acquired nine homes, two of which are in the Dalworth
area. NationsBank-Texas also has provided a $15,000
loan to the Grand Prairie Chapter of NAACP to rehabilitate and convert the facility used by a drug and
alcohol center in Dalworth.29
Conclusion Regarding Convenience and Needs
Considerations
For the foregoing reasons, and based on all the facts of
record in this case, including Protestants' comments
and NationsBank's response to these comments, the
Board concludes that convenience and needs considerations, including the records of NationsBank,
NationsBank-Florida, NationsBank-Georgia, and
NationsBank-Texas under the CRA, are consistent
with approval of this application.30
Other Considerations
The Board also concludes that the financial and managerial resources and future prospects of NationsBank
and CalFed are consistent with approval of this application. Moreover, the record in this case shows that:
(1) The transaction will not result in the transfer of
any federally insured depository institution's federal
deposit insurance from one federal deposit insurance fund to the other;
29. NationsBank-Texas also participates in the Tarrant County
Housing Partnership which is designed to promote and expand home
ownership in low- to moderate-income areas.
30. Texas Protestant also alleges that NationsBank engages in
discriminatory employment practices. The Board notes that because
NationsBank employs more than 50 people and acts as an agent to sell
or redeem U.S. savings bonds and notes, it is required by Treasury
Department and Department of Labor regulations to:
(1) File annual reports with the Equal Employment Opportunity
Commission; and
(2) Have in place a written affirmative action program which states
its intentions, efforts, and plans to achieve equal opportunity in the
employment, hiring, promotion, and separation of personnel.
753
(2) NationsBank, NationsBank-Florida, and NationsBank-Georgia currently meet, and upon consummation of the proposed transaction will continue
to meet, all applicable capital standards; and
(3) The proposed transaction would comply with the
interstate banking provision of the Bank Holding
Company Act (12 U.S.C. § 1842(d)) if the Florida
and Georgia branches of CalFed were a state bank
that NationsBank was applying to acquire directly.
See 12 U.S.C. § 1815(d)(3).
Based on the foregoing and all the facts of record, the
Board has determined that this application should be,
and hereby is, approved. The Board's approval of this
application is conditioned upon NationsBank's compliance with the commitments made in connection with
this application. This approval is further subject to
NationsBank's obtaining the OCC's approval for the
proposed transaction. For purposes of this action, the
commitments and conditions relied on in reaching this
decision are both conditions imposed in writing by the
Board and, as such, may be enforced in proceedings
under applicable law. This approval is limited to the
proposal presented to the Board by NationsBank, and
may not be construed as applying to any other transaction.
This transaction may not be consummated before
the thirtieth calendar day after the effective date of this
order, or later than three months after the effective
date of this order, unless such period is extended by
the Board or the Federal Reserve Bank of Richmond,
acting pursuant to delegated authority.
By order of the Board of Governors, effective
June 8, 1994.
Voting for this action: Governors Kelley, La Ware, Lindsey, and Phillips. Absent and not voting: Chairman
Greenspan.
JENNIFER J. JOHNSON
Associate Secretary of the Board
Appendix A
Broward County
Coral Ridge
3600 N. Federal Highway
Ft. Lauderdale, Florida 33308
Lauderdale Lakes
3099 N. State Road 7
Lauderdale Lakes, Florida 33313
Lighthouse Point
3260 N. Federal Highway
Lighthouse Point, Florida 33064
754
Federal Reserve Bulletin • August 1994
Tamarac
5900 Rock Island Road
Ft. Lauderdale, Florida 33319
University
7001 N. University Drive
Tamarac, Florida 33321
Harbor Beach
2400 SE 17th Street Causeway
Ft. Lauderdale, Florida 33316
Hollywood
4601 Sheridan Street
Hollywood, Florida 33021
Palm Beach County
Boynton Beach
289 N. Congress Avenue
Boynton Beach, Florida 33435
Delray Beach
1002 E. Atlantic Avenue
Delray Beach, Florida 33444
Woolbright
1600 S. Federal Highway
Boynton Beach, Florida 33435
Boca Glades
2200 W. Glades Road
Boca Raton, Florida 33431
Pompano Beach
1201 S. Ocean Boulevard
Pompano Beach, Florida 33062
Boca Del Mar
7301 W. Palmetto Park Road
Boca Raton, Florida 33433
Sunrise Lakes
3000 N. University Drive
Sunrise, Florida 33322
Crystal Tree
1201 N. U.S. Highway 1, Suite 1
North Palm Beach, Florida 33408
Jacaranda
8181 W. Broward Boulevard
Plantation, Florida 33324
Coral Springs
1260 N. University Drive
Coral Springs, Florida 33071
Tower
2400 E. Commercial Boulevard
Ft. Lauderdale, Florida 33308
Dade County
Coral Gables
221 Aragon Avenue
Coral Gables, Florida 33134
North Kendall
6901 SW 117th Avenue
Miami, Florida 33183
Hernando County
Spring Hill
1530 Pinehurst Drive # 4
Spring Hill, Florida 34606
Deerfield
1761 W. Hillsboro Boulevard
Deerfield Beach, Florida 33442
Hillsborough County
Pembroke Pines
10050 Pines Boulevard
Pembroke Pines, Florida 33025
Westshore
4830 W. Kennedy Boulevard
Suite 150
Tampa, Florida 33609
Lauderhill
5518 W. Oakland Park Boulevard
Lauderhill, Florida 33313
Coconut Creek
4803 Coconut Creek Parkway
Coconut Creek, Florida 33441
Palma Ceia
11555 S. Dale Mabry Highway
Tampa, Florida 33629
Carrollwood
13188 N. Dale Mabry Highway
Tampa, Florida 33618
Legal Developments
Pinellas County
Largo
2100 E. Bay Drive
Largo, Florida 34641
Clearwater
1810 N. Belcher Road
Clearwater, Florida 34625
Bryan Dairy
7490 Bryan Dairy Road
Largo, Florida 34647
Safety Harbor
2519 Mcmullen Booth Road
Clearwater, Florida 33519
Bay Pointe
5275 34th Street South
St. Petersburg, Florida 33711
755
Dunnellon
11392 N. Williams Street
Dunnellon, Florida 32670
Paddock Park
3101 SW 34th Avenue
Ocala, Florida 32674
Citrus County
Inverness
1488 N. Highway 41
Inverness, Florida 32650
Georgia Branch
7385 Rosewall Road, NE
Atlanta, Georgia 30328
Peoples Heritage Financial Group
Portland, Maine
Pasco County
Port Richey
9116 Highway 19 North
Port Richey, Florida 33586
Lee County
Fort Myers
7050 Winkler Road SW
Fort Myers, Florida 33907
Sarasota County
South Sarasota
8292 S. Tamiami Trail
Sarasota, Florida 33583
Sarasota Central
1950 S. Tamiami Trail
Sarasota, Florida 33577
Marion County
Midtown
25 E. Silver Springs Boulevard
Ocala, Florida 32670
Order Approving an Application to Acquire a
Savings Bank
Peoples Heritage Financial Group, Inc., Portland,
Maine ("Peoples Heritage"), proposes to acquire Mid
Maine Savings Bank, Auburn, Maine ("Mid Maine"),
a federally chartered savings bank with branches in
Maine and New Hampshire. Applicants seek Board
approval of this transaction pursuant to section 5(d)(3)
of the Federal Deposit Insurance Act (12 U.S.C.
§ 1815(d)(3) ("FDI Act")), as amended by the Federal
Deposit Insurance Corporation Improvement Act of
1991 (Pub. L. No. 102-242, § 501, 105 Stat. 2236,
2388-2392 (1991)).
Section 5(d)(3) of the FDI Act requires the Board to
review any proposed merger between a Savings Association Insurance Fund member and any Bank Insurance Fund ("BIF") member, if the acquiring or resulting institution is a BIF-insured subsidiary of a bank
holding company, and, in reviewing these proposals,
to follow the procedures and consider the factors set
forth in section 18(c) of the FDI Act (12 U.S.C.
§ 1828(c) ("the Bank Merger Act")).* The Federal
Deposit Insurance Corporation ("FDIC"), the primary federal regulator of Peoples Bank, has approved
the proposed merger pursuant to the Bank Merger
Boulevard
2444 E. Silver Springs Boulevard
Ocala, Florida 32670
Belleview
10990 SE Highway 441
Belleview, Florida 32670
1. 12 U.S.C. § 1815(d)(3)(E). These factors include considerations
relating to competition, financial and managerial resources, and future
prospects of the existing and proposed institutions, and the convenience and needs of the communities to be served. 12 U.S.C.
§ 1828(c).
756
Federal Reserve Bulletin • August 1994
Act. The Maine Bureau of Banking also has approved
the proposal under applicable state law.
Notice of the application, affording interested persons an opportunity to submit comments, has been
given in accordance with the Bank Merger Act and the
Board's Rules of Procedure (12 C.F.R. 262.3(b)). The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the factors set forth in the Bank
Merger Act and section 5(d)(3) of the FDI Act.
Peoples Heritage, with consolidated assets of
$2.4 billion, controls a savings bank in Maine and a
commercial bank in New Hampshire.2 Peoples Heritage is the third largest banking organization in Maine,
controlling total deposits of $1.6 billion, representing
approximately 13.8 percent of total deposits in depository institutions in the state.3 Mid Maine is the 26th
largest depository institution in Maine, controlling
deposits of $88.2 million, representing less than
1 percent of total deposits in depository institutions in
the state. Upon consummation of the proposed transaction, Peoples Heritage would remain the third largest banking organization in Maine, controlling deposits
of $1.7 billion, representing 14.5 percent of total deposits in depository institutions in the state. Peoples
Heritage would also become the seventh largest banking organization in New Hampshire, controlling deposits of $327 million, representing 2.6 percent of total
deposits in depository institutions in the state.
Competitive
Considerations
Under section 5(d)(3) of the FDI Act, the Board is
required to consider the effects that a proposed merger
would have on competition. Peoples Heritage and Mid
Maine compete directly in the Lewiston-Auburn and
Sanford banking markets, both in Maine, and the
Portsmouth-Dover-Rochester, New Hampshire banking market.4
Peoples Heritage's lead bank, Peoples Heritage Savings Bank, Portland, Maine ("Peoples Bank"), is the
largest depository institution in the Lewiston-Auburn
banking market, controlling deposits of $168 million,
representing approximately 24.9 percent of total deposits in depository institutions in the market ("mar-
2. Asset data are as of March 31, 1994.
3. Deposit and market data are as of June 30, 1993. In this context,
depository institutions include commercial banks, savings banks, and
savings associations.
4. The Lewiston-Auburn banking market is approximated by the
Lewiston-Auburn Rand-McNally Area plus the Androscoggin County
townships of Durham, Leeds, Turner, and Wales; the Oxford County
township of Hebron; and the Cumberland County township of New
Gloucester.
ket deposits").5 Mid Maine is the sixth largest depository institution in the market, controlling deposits of
$75.6 million, representing 5.6 percent of market deposits. Upon consummation of this proposal, Peoples
Bank would control $243.6 million in deposits, representing approximately 34.2 percent of market deposits. The Herfindahl-Hirschman Index ("HHI") for
this market would increase 419 points to 2022.6
A number of factors indicate that the increase in
concentration levels in the Lewiston-Auburn banking
market as measured by the HHI tend to overstate the
competitive effects of this proposal. The Board notes
that Mid Maine experienced a substantial decline in
market deposits between June 1992 and June 1993 and
was, until recently, subject to supervisory action by its
primary regulator, the Office of Thrift Supervision,
due to its financial condition. In addition, nine depository institutions, including the four largest bank holding companies in Maine, would continue to operate in
the market following consummation of this proposal.
The Board also notes that credit unions have a competitive effect on banking services offered in the
Lewiston-Auburn banking market.7
5. The Board previously has indicated that thrift institutions have
become, or have the potential to become, significant competitors of
commercial banks. See WM Bancorp, 76 Federal Reserve Bulletin 788
(1990); National City Corporation, 70 Federal Reserve Bulletin 743
(1984). Market share data before consummation are based on calculations in which the deposits of thrift institutions operating in the
market, except Peoples Bank, are included at 50 percent. The record
in this case indicates that Peoples Bank offers all or virtually all of the
cluster of banking products and services, including commercial loans.
As of year-end 1993, outstanding non-real estate commercial loans
accounted for 8.9 percent of Peoples Bank's total assets compared to
the national average for U.S. thrift institutions of 1.1 percent. Accordingly, deposits controlled by Peoples Bank have been included at
100 percent in the calculation of existing market share. See Fleet/
Norstar Financial Group, Inc., 77 Federal Reserve Bulletin 750
(1991). Because the deposits of Mid Maine would be transferred to
Peoples Bank and a commercial bank subsidiary of Peoples Heritage
under this proposal, those deposits are included at 100 percent in the
calculation of Peoples Heritage's post-consummation share of state
and banking market deposits. See Norwest Corporation, 78 Federal
Reserve Bulletin 452 (1992); First Banks, Inc., 76 Federal Reserve
Bulletin 669 (1990).
6. Under the revised Department of Justice Merger Guidelines, 49
Federal Register 26,823 (June 29, 1984), a market in which the
post-merger HHI is above 1800 is considered highly concentrated.
The Justice Department has informed the Board that a bank merger or
acquisition generally will not be challenged (in the absence of other
factors indicating anticompetitive effects) unless the post-merger HHI
is at least 1800 and the merger increases the HHI by more than 200
points. The Justice Department has stated that the higher than normal
HHI thresholds for screening bank mergers for anticompetitive effects
implicitly recognize the competitive effect of limited-purpose lenders
and other non-depository financial institutions.
7. Credit unions account for 20 percent of the combined deposits in
depository institutions and credit unions in the market, which is
substantially higher than the 5.6 percent national average of deposits
controlled by credit unions. Six of these credit unions, accounting for
12 percent of the combined deposits in this banking market, have
community-based membership criteria.
Legal Developments
In the Sanford, Maine and Portsmouth-DoverRochester, New Hampshire banking markets, consummation of this proposal would not exceed the
threshold levels in the Department of Justice's revised
Merger Guidelines.8 Moreover, numerous competitors
would remain in both markets.
In accordance with the Bank Merger Act, the Board
has sought comments from the United States Attorney
General, the Office of the Comptroller of the Currency, ("OCC"), and the FDIC on the competitive
effects of this proposal. The Attorney General has
indicated that there would be no significantly adverse
effects on competition in any relevant banking market,
and as previously noted, the FDIC has approved this
acquisition. The OCC also has not objected to the
acquisition. Based on all the facts of record, including
the number of depository institution competitors remaining in these markets, the competitive effects of
credit unions, and all other facts of record, the Board
concludes that consummation of this proposal would
not have significantly adverse effects on competition
or on the concentration of resources in any relevant
banking market.
Other Considerations
The Board also concludes that the financial and managerial resources and future prospects of Peoples
Heritage and Mid Maine are consistent with approval
of this application. Considerations relating to the convenience and needs of the communities to be served
and the other supervisory factors that the Board is
required to consider under The Bank Merger Act also
are consistent with approval. Moreover, the record in
this case shows that:
(1) The transaction will not result in the transfer of
any federally insured depository institution's federal
deposit insurance from one federal deposit insurance fund to the other;
(2) Applicant and Peoples Bank currently meet, and
upon consummation of the proposed transaction will
8. The HHI in the Sanford banking market would increase by 90
points to 2165, and the HHI in the Portsmouth-Dover-Rochester
banking market would increase by 145 points to 1037.
757
continue to meet, all applicable capital standards;
and
(3) The proposed transaction would comply with the
interstate banking provision of the Bank Holding
Company Act (12 U.S.C. § 1842(d)) if Mid Maine
were a state bank that Peoples Heritage was applying to acquire directly. See 12 U.S.C. § 1815(d)(3).9
Based on the foregoing and all the facts of record,
the Board has determined that this application should
be, and hereby is, approved. Approval of this application is conditioned on Peoples Heritage's compliance
with the commitments made in connection with this
application, and is further subject to Portsmouth Bank
obtaining the OCC's approval for the proposed transaction. For purposes of this action, the commitments
and conditions relied on in reaching this decision are
both conditions imposed in writing by the Board and,
as such, may be enforced in proceedings under applicable law. This approval is limited to the proposal
presented to the Board by Peoples Heritage, and may
not be construed as applying to any other transaction.
This transaction may not be consummated before
the thirtieth calendar day after the effective date of this
order, or later than three months after the effective
date of this order, unless such period is extended by
the Board or the Federal Reserve Bank of Boston,
acting pursuant to delegated authority.
By order of the Board of Governors, effective
June 20, 1994.
Voting for this action: Chairman Greenspan and Governors
Kelley, LaWare, Lindsey, and Phillips.
JENNIFER J. JOHNSON
Associate Secretary of the Board
9. Maine and New Hampshire have each enacted an interstate
banking statute that permits bank holding companies in every state to
acquire banks in in their respective states. See Me. Rev. Stat. Ann.
title 9-B, § 1013(2) (Supp. 1993); N.H. Rev. Stat. Ann. § 384:47 (Supp.
1993). Mid Maine would merge with and into Peoples Bank. Immediately following the merger, Peoples Heritage's bank subsidiary, The
First National Bank of Portsmouth, Portsmouth, New Hampshire
("Portsmouth Bank"), would assume the liabilities and purchase the
assets of the Hampton, New Hampshire branch office of Mid Maine.
Peoples Bank would not operate the New Hampshire branches.
758
Federal Reserve Bulletin • August 1994
ACTIONS TAKEN UNDER THE FEDERAL DEPOSIT INSURANCE CORPORATION IMPROVEMENT ACT OF
1991
By the Secretary of the Board
Copies are available upon request to the Freedom of Information Office, Office of the Secretary, Board of
Governors of the Federal Reserve System, Washington, D.C. 20551.
Bank Holding Company
Acquired
Thrift
First National of Nebraska, Inc.
Omaha, Nebraska
Franklin Federal Savings
Association,
Ottawa, Kansas
Security Capital Bancorp,
Salisbury, North Carolina
First Charlotte Interim
Bank,
Charlotte, North
Carolina
Trans Financial Bank of
Tennessee, F.S.B.,
Cookeville, Tennessee
Trans Financial Bancorp, Inc.
Bowling Green, Kentucky
Acquiring
Bank(s)
First National Bank
of Kansas,
Overland Park,
Kansas
Security Bank and
Trust Company,
Salisbury, North
Carolina
Peoples Bank and
Trust of the
Cumberlands,
Cooke ville,
Tennessee
Approval
Date
June 10, 1994
June 30, 1994
June 27, 1994
ACTIONS TAKEN UNDER THE FEDERAL DEPOSIT INSURANCE CORPORATION IMPROVEMENT ACT OF
1991
By the Director of the Division of Banking Supervision and Regulation and the General Counsel of
the Board
Copies are available upon request to the Freedom of Information Office, Office of the Secretary, Board of
Governors of the Federal Reserve System, Washington, D.C. 20551.
Bank Holding Company
Acquired
Thrift
BSB Bancorp., Inc.,
Binghamton, New York
Columbia Banking FSA,
Rochester, New York
Chemical Bank and Trust
Company,
Midland, Michigan
Community Bank System, Inc.,
DeWitt, New York
Standard Federal Bank,
Troy, Michigan
Columbia Banking FSA,
Rochester, New York
Family Bancorp,
Haverhill, Massachusetts
First Federal Savings
Bank of Boston,
Boston, Massachusetts
Financial Institutions, Inc.,
Warsaw, New York
Columbia Banking FSA,
Rochester, New York
Acquiring
Bank(s)
Binghamton Savings
Bank,
Binghamton, New
York
Chemical Financial
Corporation,
Midland, Michigan
Community Bank,
N.A.,
Canton, New York
Family Mutual
Savings Bank,
Haverhill,
Massachusetts
The National Bank of
Geneva,
Geneva, New York
Approval
Date
June 3, 1994
June 15, 1994
June 3, 1994
June 10, 1994
June 3, 1994
Legal Developments
FDICIA Orders—Continued
Bank Holding Company
Acquired
Thrift
Financial Institutions, Inc.,
Warsaw, New York
Columbia Banking FSA,
Rochester, New York
First Citizens Bank and Trust
Company of South Carolina,
Columbia, South Carolina
Cooper River Federal
Savings Association,
North Charleston,
South Carolina
Fulton Financial Corporation,
Lancaster, Pennsylvania
Great Valley Savings
Bank,
Reading, Pennsylvania
Harbor Bankshares Corporation,
Baltimore, Maryland
John Hanson Federal
Savings Bank,
Beltsville, Maryland
KeyCorp, Inc.,
Cleveland, Ohio
Columbia Banking
Federal Savings
Association,
Rochester, New York
Security Federal Savings
Bank,
Vineland, New Jersey
Meridian Bancorp, Inc.,
Cherry Hill, New Jersey
Mercantile Bancorporation Inc.,
St. Louis, Missouri
ONBANCorp, Inc.,
Syracuse, New York
United Postal Savings
Association,
St. Louis, Missouri
Columbia Banking FSA,
Rochester, New York
Acquiring
Bank(s)
Wyoming County
Bank,
Warsaw, New York
First Citizens
Bancorporation of
South Carolina,
Inc.,
Columbia, South
Carolina
Fulton Bank,
Lancaster,
Pennsylvania
The First National
Bank of Danville,
Danville,
Pennsylvania
Swineford National
Bank,
Middleburg,
Pennsylvania
The Harbor Bank of
Maryland,
Baltimore,
Maryland
Key Bank of New
York,
Albany, New York
Meridian Bank,
New Jersey,
Cherry Hill, New
Jersey
Mercantile Bank of
St. Louis, N.A.,
St. Louis, Missouri
OnBank & Trust
Company,
Syracuse, New
York
Approval
Date
June 3, 1994
June 3, 1994
June 7, 1994
June 10, 1994
June 3, 1994
June 17, 1994
June 14, 1994
June 3, 1994
759
760
Federal Reserve Bulletin • August 1994
APPLICATIONS APPROVED UNDER BANK HOLDING COMPANY ACT
By the Secretary of the Board
Recent applications have been approved by the Secretary of the Board as listed below. Copies are available upon
request to the Freedom of Information Office, Office of the Secretary, Board of Governors of the Federal Reserve
System, Washington, D.C. 20551.
Section 3
Applicant(s)
First Commercial Corporation,
Little Rock, Arkansas
Keystone Financial, Inc.,
Harrisburg, Pennsylvania
Union Planters Corporation,
Memphis, Tennessee
Bank(s)
United American Bancshares, Inc.,
Palestine, Texas
The First National Bank of Palestine,
Palestine, Texas
The Frankford Corporation,
Philadelphia, Pennsylvania
Earle Bankshares, Inc.,
Earle, Arkansas
Effective
Date
June 15, 1994
June 6, 1994
June 7, 1994
Section 4
Applicant(s)
Compass Bancshares, Inc.
Birmingham, Alabama
First Commercial Corporation,
Little Rock, Arkansas
Bank(s)
to engage de novo in
making, acquiring or
servicing loans or other
extensions of credit
to engage de novo in
making, acquiring, or
servicing loans or other
extensions of credit
Effective
Date
June 14, 1994
June 10, 1994
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.
Legal Developments
Section 3
Applicant(s)
Adam Financial Corporation,
Bryan, Texas
Alabama National
Bancorporation,
Shoal Creek, Alabama
Alabama National
Bancorporation,
Shoal Creek, Alabama
AMCORE Financial, Inc.,
Rockford, Illinois
Central Pennsylvania Financial
Corporation,
Shamokin, Pennsylvania
Central Shares, Inc.,
Lebanon, Missouri
Citco Community Bancshares,
Inc.,
Elizabethton, Tennessee
Comerica Incorporated,
Detroit, Michigan
Comerica Texas Incorporated,
Dallas, Texas
Commercial Financial
Corporation, Inc.,
Storm Lake, Iowa
Community Bancshares of
Marysville, Inc.,
Marysville, Kansas
Cooperative Bankshares, Inc.,
Wilmington, North Carolina
CSB, Inc.,
Bixby, Oklahoma
FCB Bancshares, Inc.,
Good Hope, Alabama
Reserve
Bank
Bank(s)
New Adam Bank Group,
Inc.,
Dover, Delaware
First American Bank,
Bryan, Texas
Citizens Holding
Company, Inc.,
Talladega, Alabama
Saint Clair Holding
Company, Inc.,
Pell City, Alabama
First State Bancorp of
Princeton Illinois, Inc.,
Princeton, Illinois
Central Pennsylvania
Savings Bank,
Shamokin,
Pennsylvania
Security Bancshares of
Pulaski County, Inc.,
St. Robert, Missouri
Citco Bancshares, Inc.,
Elizabethton,
Tennessee
Lockwood Banc Group,
Inc.,
Houston, Texas
Central Trust Investment,
Inc.,
Cherokee, Iowa
Citizens Bancshares of
Marysville, Inc.,
Marysville, Kansas
Citizens Bancshares of
Waterville, Inc.,
Waterville, Kansas
Cooperative Bank for
Savings, Inc., SSB,
Wilmington, North
Carolina
Citizens Security
Bancshares, Inc.,
Bixby, Oklahoma
First Commercial Bank of
Cullman County,
Good Hope, Alabama
Effective
Date
Dallas
June 2, 1994
Atlanta
June 1, 1994
Atlanta
June 1, 1994
Chicago
June 17, 1994
Philadelphia
June 7, 1994
St. Louis
May 24, 1994
Atlanta
June 7, 1994
Chicago
June 14, 1994
Chicago
May 27, 1994
Kansas City
May 27, 1994
Richmond
June 22, 1994
Kansas City
May 27, 1994
Atlanta
May 31, 1994
761
762
Federal Reserve Bulletin • August 1994
Section 3—Continued
Applicant(s)
F & M National Corporation,
Winchester, Virginia
F & M National Corporation,
Winchester, Virginia
First Ainsworth Company,
Ainsworth, Nebraska
First Bank Corp.,
Fort Smith, Arkansas
First Financial Bancshares, Inc.
Sallisaw, Oklahoma
First Tennessee National
Corporation,
Memphis, Tennessee
First Trust Holdings, Inc.,
Watseka, Illinois
Freedom Bancshares, Inc.,
Osage City, Kansas
Fulton Financial Corporation,
Lancaster, Pennsylvania
Glen Rock State Bancorp, Inc.,
Glen Rock, Pennsylvania
Heartland Financial USA, Inc.,
Dubuque, Iowa
Kingston Bancshares, Inc.,
Kingston, Ohio
Madison Bancorp, Inc.,
Madison Heights, Michigan
Marquette National Corporation,
Chicago, Illinois
McCreary Bancshares, Inc.,
Whitley City, Kentucky
Bank(s)
Hallmark Bank and Trust
Company,
Springfield, Virginia
PNB Financial
Corporation,
Warrenton, Virginia
Kulek Insurance Agency,
Ainsworth, Nebraska
First National Agency of
Ainsworth, Inc.,
Ainsworth, Nebraska
Vista Bancorporation,
Inc.,
Van Buren, Arkansas
First Sallisaw Bancshares,
Inc.,
Sallisaw, Oklahoma
Planters Bank,
Tunica, Mississippi
The First Trust and
Savings Bank of
Watseka,
Watseka, Illinois
The First National Bank
of Clifton,
Clifton, Illinois
Citizens State Bank,
Osage City, Kansas
Central Pennsylvania
Savings Bank,
Shamokin,
Pennsylvania
The Glen Rock State
Bank,
Glen Rock,
Pennsylvania
Keokuk Bancshares, Inc.,
Keokuk, Iowa
Kingston National Bank,
Kingston, Ohio
Madison National Bank,
Madison Heights,
Michigan
Orland State Bank,
Orland Park, Illinois
First Trust and Savings
Bank,
Oneida, Tennessee
Reserve
Bank
Effective
Date
Richmond
May 31, 1994
Richmond
May 31, 1994
Kansas City
June 1, 1994
St. Louis
June 15, 1994
Kansas City
May 27, 1994
St. Louis
May 25, 1994
Chicago
June 1, 1994
Kansas City
June 21, 1994
Philadelphia
June 7, 1994
Philadelphia
May 25, 1994
Chicago
June 16, 1994
Cleveland
June 13, 1994
Chicago
June 22, 1994
Chicago
May 31, 1994
Cleveland
June 13, 1994
Legal Developments
Section 3—Continued
Applicant(s)
Mountain West Financial Corp.,
Helena, Montana
New Adam Bank Group, Inc.,
Dover, Delaware
PCI Holdings, Inc.,
St. Marys, Kansas
Pinnacle Bancorp, Inc.,
Central City, Nebraska
Prescott Bancshares, Inc.,
Pre scott, Arkansas
The Second Fourth St. Financial
Corp.,
Pekin, Illinois
Security Bancshares of Pulaski
County, Inc.,
St. Robert, Missouri
Texas Financial Bancorporation,
Inc.,
Minneapolis, Minnesota
First Bancorp, Inc.,
Denton, Texas
First Delaware Bancorp, Inc.,
Dover, Delaware
Waterhouse Investor Services,
Inc.,
New York, New York
Westside Financial Corporation,
Kennesaw, Georgia
Reserve
Bank
Bank(s)
Mountain West Bank of
Helena, N.A.,
Helena, Montana
First American Bank,
Bryan, Texas
St. Marys State Bank,
St. Marys, Kansas
Nebraska Capital
Corporation,
Lincoln, Nebraska
First State Holding
Company of Prescott,
Prescott, Arkansas
Herget Financial Corp.,
Pekin, Illinois
The Herget National
Bank of Pekin,
Pekin, Illinois
Security Bank of Pulaski
County,
St. Robert, Missouri
Bedford National Bank,
Bedford, Texas
Waterhouse National
Bank,
White Plains, New
York
The Westside Bank and
Trust Company,
Kennesaw, Georgia
Effective
Date
Minneapolis
June 2, 1994
Dallas
June 2, 1994
Kansas City
June 1, 1994
Kansas City
May 27, 1994
St. Louis
June 14, 1994
Chicago
June 21, 1994
St. Louis
May 24, 1994
Dallas
June 9, 1994
New York
June 10, 1994
Atlanta
June 17, 1994
Section 4
.
..
. .
Nonbanking
Activity/Company
Banco Santander, S.A.,
Santander, Spain
First Fidelity Bank,
FSB,
Belts ville, Maryland
John Hanson Federal
Savings Bank,
Belts ville, Maryland
PP
Reserve
Bank
New York
Effective
Date
June 10, 1994
763
764
Federal Reserve Bulletin • August 1994
Section 4—Continued
Applicant(s)
BankAmerica Corporation,
San Francisco, California
BankAmerica Corporation,
San Francisco, California
Citco Community Bancshares,
Inc.,
Elizabethton, Tennessee
Community Bancshares, Inc.,
North Wilkesboro,
North Carolina
First Banks, Inc.,
Clayton, Missouri
First Fidelity Bancorporation,
Lawrenceville, New Jersey
First State Bancorp, Inc.,
La Crosse, Wisconsin
Fulton Financial Corporation,
Lancaster, Pennsylvania
J.P. Morgan & Co. Incorporated,
New York, New York
J.P. Morgan & Co. Incorporated,
New York, New York
Mainline Bankshares of Portland,
Inc.,
Portland, Arkansas
Nonbanking
Activity/Company
BA Futures, Inc.,
Chicago, Illinois
United Mortgage Holding
Company,
Bloomington,
Minnesota
Small Business
Resources, Inc.,
Panama City, Florida
Community Mortgage
Corporation of North
Carolina,
States ville, North
Carolina
St. Charles Federal
Bancshares Inc.,
St. Charles, Missouri
First Fidelity Bank, FSB,
Belts ville, Maryland
Community First
Development
Corporation,
La Crosse, Wisconsin
Central Pennsylvania
Financial Corp.,
Shamokin,
Pennsylvania
Central Pennsylvania
Savings Association,
Shamokin,
Pennsylvania
to engage in making
equity and debt
investments in
corporations or projects
designed primarily to
promote community
welfare
The New York Equity
Fund 1989 Limited
Partnership,
New York, New York
Henry Phipps Plaza South
Associates Limited
Partnership,
New York, New York
HUDC TC Limited
Partnership,
New York, New York
to engage in lending
activities
Reserve
Bank
Effective
Date
San Francisco
June 3, 1994
San Francisco
June 17, 1994
Atlanta
June 7, 1994
Richmond
June 2, 1994
St. Louis
June 15, 1994
Philadelphia
June 10, 1994
Minneapolis
June 2, 1994
Philadelphia
June 7, 1994
New York
June 20, 1994
New York
June 3, 1994
St. Louis
June 9, 1994
Legal Developments
765
Section 4—Continued
Nonbanking
Activity/Company
Applicant(s)
National Penn Bancshares, Inc.,
Boyertown, Pennsylvania
Northwest Bancorporation, Inc.,
Houston, Texas
Norwest Corporation,
Minneapolis, Minnesota
Norwest Corporation,
Minneapolis, Minnesota
Norwest Corporation,
Minneapolis, Minnesota
Wilmington Trust Corporation,
Wilmington, Delaware
Investors Trust Company,
Wyomissing,
Pennsylvania
Coronado Financial
Group, Inc.,
Houston, Texas
American Land Title
Company of Kansas
City, Inc.,
Kansas City, Missouri
First Insurance Agency of
Detroit Lakes, Inc.,
Detroit Lakes,
Minnesota
Title Network Agency,
Buffalo, New York
Wilmington Trust FSB,
Salisbury, Maryland
Reserve
Bank
Effective
Date
Philadelphia
June 7, 1994
Dallas
June 16, 1994
Minneapolis
June 8, 1994
Minneapolis
June 22, 1994
Minneapolis
May 26, 1994
Philadelphia
June 10, 1994
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 of Fresno,
Fresno, California
Fleet Bank of New York,
Albany, New York
Wellington State Bank,
Wellington, Texas
Reserve
Bank
Bank(s)
Merced Bank of
Commerce,
Merced, California
Fleet Bank,
Melville, New York
First National Bank in
Wheeler,
Wheeler, Texas
Effective
Date
San Francisco
May 23, 1994
New York
June 1, 1994
Dallas
June 16, 1994
766
Federal Reserve Bulletin • August 1994
PENDING CASES INVOLVING THE BOARD OF
GOVERNORS
This list of pending cases does not include suits
against the Federal Reserve Banks in which the Board
of Governors is not named a party.
National Title Resource Agency v. Board of Governors, No. 94-2050 (8th Cir., filed April 28, 1994).
Petition for review of Board's order, issued under
section 4 of the Bank Holding Company Act, approving the application of Norwest Corp., Minneapolis, Minnesota, to acquire Double Eagle Financial
Corp., Phoenix, Arizona, and its subsidiary, United
Title Agency, Inc., and thereby engage in title
insurance agency activities and real estate settlement services (80 Federal Reserve Bulletin 453)
(1994)). Petitioner's brief was filed June 7, 1994.
Scott v. Board of Governors, No. 94-4117 (10th Cir.),
filed April 28, 1994. Appeal of dismissal of action
against Board and others for damages and injunctive
relief for alleged constitutional and statutory violations caused by issuance of Federal Reserve notes.
Beckman v. Greenspan, No. CV 94-41-BCG-RWA
(D. Mont., filed April 13, 1994). Action against
Board and others seeking damages for alleged violations of constitutional and common law rights. The
Board's motion to dismiss was filed May 19, 1994.
DLG Financial Corp. v. Board of Governors, No.
94-10078 (5th Cir., filed January 20, 1994). Appeal
of district court dismissal of appellants' action to
enjoin the Board and the Federal Reserve Bank of
Dallas from taking certain enforcement actions, and
for money damages on a variety of tort and contract
theories. The case has been consolidated on appeal
with Board of Governors v. DLG Financial Corp.,
Nos. 93-2944 and 94-20013 (5th Cir., filed December 14, 1993 and December 31,1993), an appeal of a
temporary restraining order and a preliminary injunction obtained by the Board freezing assets of a
corporation and an individual pending administrative adjudication of civil money penalty assessments
by the Board. Oral argument on the consolidated
appeal was held June 1, 1994.
Richardson v. Board of Governors, et al., No. 944020 (10th Cir.), filed January 14, 1994. Appeal of
dismissal of action against Board and others for
damages and injunctive relief for alleged constitutional and statutory violations caused by issuance of
Federal Reserve notes. The Board's brief was filed
June 3, 1994.
Board of Governors v. Oppegard, No. 93-3706 (8th
Cir., filed November 1, 1993). Appeal of district
court order ordering appellant Oppegard to comply
with prior order requiring compliance with Board
prohibition and civil money penalty orders. Oral
argument was held June 16, 1994.
Jackson v. Board of Governors, No. CV-N-93-401ECR (D. Nev., filed June 14, 1993). Pro se action for
violation of a prisoner's civil rights. On November
26, 1993, the Board filed a motion to dismiss.
First National Bank ofBellaire v. Board of Governors,
No. H-93-1708 (S.D. Texas, filed June 8, 1993).
Action to enjoin possible enforcement actions by
Board of Governors and other bank regulatory agencies. On March 8,1994, the district court granted the
agencies' motion to dismiss; on June 20, 1994, the
court denied plaintiff's motion for reconsideration.
Kubany v. Board of Governors, et al., No. 93-1428 (D.
D.C., filed July 9, 1993). Action challenging Board
determination under the Freedom of Information
Act. The Board's motion to dismiss was filed on
October 15, 1993.
Bennett v. Greenspan, No. 93-1813 (D. D.C., filed
April 20, 1993). Employment discrimination action.
Trial is scheduled to commence August 1, 1994.
Amann v. Prudential Home Mortgage Co., et al., No.
93-10320 WD (D. Massachusetts, filed February 12,
1993). Action for fraud and breach of contract
arising out of a home mortgage. On April 17, 1993,
the Board filed a motion to dismiss.
Adams v. Greenspan, No. 93-0167 (D. D.C., filed
January 27,1993). Action by former employee under
the Civil Rights Act of 1964 and the Rehabilitation
Act of 1973 concerning termination of employment.
The Board's motion for partial summary judgment
was filed on January 4, 1994.
CBC, Inc. v. Board of Governors, No. 93-1458 (U.S.
Supreme Court, filed March 17, 1994). Petition for
review of civil money penalty assessment against a
bank holding company and three of its officers and
directors for failure to comply with reporting requirements. On November 30, 1993, the Court of
Appeals for the 10th Circuit denied the petition for
review, and the plaintiffs' petition for certiorari was
denied on June 6, 1994.
Zemel v. Board of Governors, No. 92-1056 (D. D.C.,
filed May 4, 1992). Age Discrimination in Employment Act case. The parties' cross-motions for summary judgment are pending.
Board of Governors v. Ghaith R. Pharaon, No. 91CIV-6250 (S.D. New York, filed September 17,
1991). Action to freeze assets of individual pending
administrative adjudication of civil money penalty
assessment by the Board. On September 17, 1991,
the court issued an order temporarily restraining the
transfer or disposition of the individual's assets.
Legal Developments
FINAL ENFORCEMENT ORDERS ISSUED BY THE
BOARD OF GOVERNORS
Gene A. Osborne
Englewood, Colorado
The Federal Reserve Board announced on June 3,
1994, the issuance of an Order of Prohibition against
Gene A. Osborne, the former president and principal
shareholder of Arvada Bank Holding Company, Englewood, Colorado, a former registered bank holding
company.
Scott A. Noyes
Colorado Springs, Colorado
The Federal Reserve Board announced on June 21,
1994, the issuance of a combined Order to Cease and
Desist and of Assessment of a Civil Money Penalty
767
against Scott A. Noyes, the sole officer and director of
Peoples Bancshares, Inc.
Peoples Bancshares, Inc.
Colorado Springs, Colorado
The Federal Reserve Board announced on June 21,
1994, the issuance of an Order of Assessment of a Civil
Money Penalty against Peoples Bancshares, Inc., Colorado Springs, Colorado, a bank holding company.
Pioneer Bank
Fullerton, California
The Federal Reserve Board announced on June 9,
1994, the issuance of a Prompt Corrective Action
Directive by Consent against Pioneer Bank, Fullerton,
California.
769
Membership of the Board of Governors
of the Federal Reserve System, 1913-94
APPOINTIVE
MEMBERS1
Name
Federal Reserve
District
Date of initial
oath of office
Charles S. Hamlin.
.Boston
Aug. 10, 1914
Paul M. Warburg...
Frederic A. Delano
W.P.G. Harding
Adolph C. Miller....
.New York
.Chicago
.Atlanta
.San Francisco
Albert Strauss
Henry A. Moehlenpah
Edmund Piatt
New York
Chicago....
New York
.Oct. 26, 1918
.Nov. 10, 1919
.June 8, 1920
David C. Wills
John R. Mitchell
Milo D. Campbell
Daniel R. Crissinger
George R. James
Cleveland ...
Minneapolis
Chicago
Cleveland ...
St. Louis....
.Sept. 29, 1920
.May 12, 1921
.Mar. 14, 1923
.May 1, 1923
.May 14, 1923
Edward H. Cunningham...Chicago
Roy A. Young
Minneapolis .
Eugene Meyer
New York ...
Wayland W. Magee
Kansas City.
Eugene R. Black
Atlanta
M.S. Szymczak
Chicago
do
.Oct. 4, 1927
.Sept. 16, 1930
.May 18, 1931
.May 19, 1933
June 14, 1933
J.J. Thomas
Marriner S. Eccles
do
.Nov. 15, 1934
Other dates and information relating
to membership2
Reappointed in 1916 and 1926. Served until
Feb. 3, 1936.3
do.
do.
do.
do.
Term expired Aug. 9, 1918.
Resigned July 21, 1918.
Term expired Aug. 9, 1922.
Reappointed in 1924. Reappointed in 1934
from the Richmond District. Served until
Feb. 3, 1936.3
Joseph A. Broderick
New York ..
John K. McKee
Cleveland ...
Ronald Ransom
Atlanta
Ralph W. Morrison
Dallas
Chester C. Davis
Richmond...
Ernest G. Draper
New York ..
Rudolph M. Evans
Richmond...
James K. Vardaman, Jr. ..St. Louis —
Lawrence Clayton
Boston
Thomas B. McCabe
Philadelphia
Edward L. Norton
Atlanta
Oliver S. Powell
Minneapolis
Wm. McC. Martin, Jr
New York ..
.Feb. 3, 1936
do
do
.Feb. 10, 1936
.June 25, 1936
.Mar. 30, 1938
.Mar. 14, 1942
.Apr. 4, 1946
.Feb. 14, 1947
.Apr. 15, 1948
.Sept. 1, 1950
do
.April 2, 1951
A.L. Mills, Jr
J.L. Robertson
C. Canby Balderston
Paul E. Miller
Chas. N. Shepardson
G.H. King, Jr
San Francisco
Kansas City...
Philadelphia...
Minneapolis ...
Dallas
Atlanta
.Feb. 18, 1952
do
.Aug. 12, 1954
.Aug. 13, 1954
.Mar. 17, 1955
.Mar. 25, 1959
George W. Mitchell
Chicago
Aug. 31, 1961
Resigned Mar. 15, 1920.
Term expired Aug. 9, 1920.
Reappointed in 1928. Resigned
Sept. 14, 1930.
Term expired Mar. 4, 1921.
Resigned May 12, 1923.
Died Mar. 22, 1923.
Resigned Sept. 15, 1927.
Reappointed in 1931. Served until
Feb. 3, 1936.4
Died Nov. 28, 1930.
Resigned Aug. 31, 1930.
Resigned May 10, 1933.
Term expired Jan. 24, 1933.
Resigned Aug. 15, 1934.
Reappointed in 1936 and 1948. Resigned
May 31, 1961.
Served until Feb. 10, 1936.3
Reappointed in 1936, 1940, and 1944.
Resigned July 14, 1951.
Resigned Sept. 30, 1937.
Served until Apr. 4, 1946.3
Reappointed in 1942. Died Dec. 2, 1947.
Resigned July 9, 1936.
Reappointed in 1940. Resigned Apr. 15, 1941.
Served until Sept. 1, 1950.3
Served until Aug. 13, 1954.3
Resigned Nov. 30, 1958.
Died Dec. 4, 1949.
Resigned Mar. 31, 1951.
Resigned Jan. 31, 1952.
Resigned June 30, 1952.
Reappointed in 1956. Term expired
Jan. 31, 1970.
Reappointed in 1958. Resigned Feb. 28, 1965.
Reappointed in 1964. Resigned Apr. 30, 1973.
Served through Feb. 28, 1966.
Died Oct. 21, 1954.
Retired Apr. 30, 1967.
Reappointed in 1960. Resigned
Sept. 18, 1963.
Reappointed in 1962. Served until
J. Dewey Daane
Sherman J. Maisel
Richmond
San Francisco
Nov. 29, 1963
Apr. 30, 1965
Served until Mar. 8, 1974.3
Served through May 31, 1972.
Kansas City...
San Francisco
Feb. 13, 1976.3
770
Federal Reserve
District
Name
Date of initial
oath of office
Andrew F. Brimmer
William W. Sherrill
Arthur F. Burns
Philadelphia
Dallas
New York
Mar. 9, 1966
May 1, 1967
Jan. 31, 1970
John E. Sheehan
Jeffrey M. Bucher
Robert C. Holland
Henry C. Wallich
Philip E. Coldwell
Philip C. Jackson, Jr
J. Charles Partee
Stephen S. Gardner
David M. Lilly
G. William Miller
Nancy H. Teeters
Emmett J. Rice
Frederick H. Schultz
Paul A. Volcker
Lyle E. Gramley
Preston Martin
Martha R. Seger
Wayne D. Angell
Manuel H. Johnson
H. Robert Heller
Edward W. Kelley, Jr
Alan Greenspan
John P. LaWare
David W. Mullins, Jr
Lawrence B. Lindsey
Susan M. Phillips
Alan S. Blinder
St. Louis
San Francisco
Kansas City
Boston
Dallas
Atlanta
Richmond
Philadelphia
Minneapolis
San Francisco
Chicago
New York
Atlanta
Philadelphia
Kansas City
San Francisco
Chicago
Kansas City
Richmond
San Francisco
Dallas
New York
Boston
St. Louis
Richmond
Chicago
Philadelphia
Jan. 4, 1972
June 5, 1972
June 11, 1973
Mar. 8, 1974
Oct. 29, 1974
July 14, 1975
Jan. 5, 1976
Feb. 13, 1976
June 1, 1976
Mar. 8, 1978
Sept. 18, 1978
June 20, 1979
July 27, 1979
Aug. 6, 1979
May 28, 1980
Mar. 31, 1982
July 2, 1984
Feb. 7, 1986
Feb. 7, 1986
Aug. 19, 1986
May 26, 1987
Aug. 11, 1987
Aug. 15, 1988
May 21, 1990
Nov. 26, 1991
Dec. 2, 1991
June 27, 1994
Chairmen4
Charles S. Hamlin
W.P.G. Harding
Daniel R. Crissinger
Roy A. Young
Eugene Meyer
Eugene R. Black
Marriner S. Eccles
Thomas B. McCabe
Wm. McC. Martin, Jr.
Arthur F. Burns
G. William Miller
Paul A. Volcker
Alan Greenspan
EX-OFFICIO
Aug. 10, 1914-Aug. 9, 1916
Aug. 10, 1916-Aug. 9, 1922
May 1, 1923-Sept. 15, 1927
Oct. 4, 1927-Aug. 31, 1930
Sept. 16, 1930-May 10, 1933
May 19, 1933-Aug. 15, 1934
Nov. 15, 1934-Jan. 31, 1948
Apr. 15, 1948-Mar. 31, 1951
..Apr. 2, 1951-Jan. 31, 1970
Feb. 1, 1970-Jan. 31, 1978
Mar. 8, 1978-Aug. 6, 1979
Aug. 6, 1979-Aug. 11, 1987
Aug. 11, 1987-
Other dates and information relating
to membership2
Resigned Aug. 31, 1974.
Reappointed in 1968. Resigned Nov. 15, 1971.
Term began Feb. 1, 1970.
Resigned Mar. 31, 1978.
Resigned June 1, 1975.
Resigned Jan. 2, 1976.
Resigned May 15, 1976.
Resigned Dec. 15, 1986.
Served through Feb. 29, 1980.
Resigned Nov. 17, 1978.
Served until Feb. 7, 1986.3
Died Nov. 19, 1978.
Resigned Feb. 24, 1978.
Resigned Aug. 6, 1979.
Served through June 27, 1984.
Resigned Dec. 31, 1986.
Served through Feb. 11, 1982.
Resigned August 11, 1987.
Resigned Sept. 1, 1985.
Resigned April 30, 1986.
Resigned March 11, 1991.
Served through Feb. 9, 1994.
Resigned August 3, 1990.
Resigned July 31, 1989.
Reappointed in 1990.
Reappointed in 1992.
Resigned Feb. 14, 1994.
Vice Chairmen4
Frederic A. Delano
Aug. 10, 1914-Aug. 9, 1916
Paul M. Warburg
Aug. 10, 1916-Aug. 9, 1918
Albert Strauss
Oct. 26, 1918-Mar. 15, 1920
Edmund Piatt
July 23, 1920-Sept. 14, 1930
J.J. Thomas
Aug. 21, 1934-Feb. 10, 1936
Ronald Ransom
Aug. 6, 1936-Dec. 2, 1947
C. Canby Balderston
Mar. 11, 1955-Feb. 28, 1966
J.L. Robertson
Mar. 1, 1966-Apr. 30, 1973
George W. Mitchell
May 1, 1973-Feb. 13, 1976
Stephen S. Gardner
Feb. 13, 1976-Nov. 19, 1978
Frederick H. Schultz ...July 27, 1979-Feb. 11, 1982
Preston Martin
Mar. 31, 1982-Apr. 30, 1986
Manuel H. Johnson
Aug. 4, 1986-Aug. 3, 1990
David W. Mullins, Jr. ...July 24, 1991-Feb. 14, 1994
Alan S. Blinder
June 27, 1994-
MEMBERS1
Secretaries of the Treasury
W.G. McAdoo
Dec. 23, 1913-Dec. 15, 1918
Carter Glass
Dec. 16, 1918-Feb. 1, 1920
David F. Houston
Feb. 2, 1920-Mar. 3, 1921
Andrew W. Mellon
Mar. 4, 1921-Feb. 12, 1932
Ogden L. Mills
Feb. 12, 1932-Mar. 4, 1933
William H. Woodin
Mar. 4, 1933-Dec. 31, 1933
Henry Morgenthau Jr. ...Jan. 1, 1934-Feb. 1, 1936
Comptrollers of the Currency
John Skelton Williams...Feb. 2, 1914-Mar. 2, 1921
Daniel R. Crissinger
Mar. 17, 1921-Apr. 30, 1923
Henry M. Dawes
May 1, 1923-Dec. 17, 1924
Joseph W. Mcintosh
Dec. 20, 1924-Nov. 20, 1928
J.W. Pole
Nov. 21, 1928-Sept. 20, 1932
J.F.T. O'Connor
May 11, 1933-Feb. 1, 1936
1. Under the provisions of the original Federal Reserve Act, the
Federal Reserve Board was composed of seven members, including
five appointive members, the Secretary of the Treasury, who was
ex-officio chairman of the Board, and the Comptroller of the Currency. The original term of office was ten years, and the five original
appointive members had terms of two, four, six, eight, and ten years
respectively. In 1922 the number of appointive members was increased to six, and in 1933 the term of office was increased to twelve
years. The Banking Act of 1935, approved Aug. 23,1935, changed the
name of the Federal Reserve Board to the Board of Governors of the
Federal Reserve System and provided that the Board should be
composed of seven appointive members; that the Secretary of the
Treasury and the Comptroller of the Currency should continue to
serve as members until Feb. 1, 1936; that the appointive members in
office on the date of that act should continue to serve until Feb. 1,
1936, or until their successors were appointed and had qualified; and
that thereafter the terms of members should be fourteen years and that
the designation of Chairman and Vice Chairman of the Board should
be for a term of four years.
2. Date after words "Resigned" and "Retired" denotes final day of
service.
3. Successor took office on this date.
4. Chairman and Vice Chairman were designated Governor and
Vice Governor before Aug. 23, 1935.
Al
Financial and Business Statistics
CONTENTS
WEEKLY REPORTING COMMERCIAL BANKS
A3 Guide to Tabular Presentation
Assets and liabilities
A21 Large reporting banks
A23 Branches and agencies of foreign banks
Domestic Financial Statistics
MONEY STOCK AND BANK CREDIT
FINANCIAL MARKETS
A4
A24 Commercial paper and bankers dollar
acceptances outstanding
A25 Prime rate charged by banks on short-term
business loans
A26 Interest rates—money and capital markets
All Stock market—Selected statistics
A5
A6
A7
Reserves, money stock, liquid assets, and debt
measures
Reserves of depository institutions, Reserve Bank
credit
Reserves and borrowings—Depository
institutions
Selected borrowings in immediately available
funds—Large member banks
FEDERAL FINANCE
POLICY INSTRUMENTS
A8 Federal Reserve Bank interest rates
A9 Reserve requirements of depository institutions
A10 Federal Reserve open market transactions
FEDERAL RESERVE BANKS
A l l Condition and Federal Reserve note statements
A12 Maturity distribution of loan and security
holdings
MONETARY AND CREDIT AGGREGATES
A13 Aggregate reserves of depository institutions
and monetary base
A14 Money stock, liquid assets, and debt measures
A16 Deposit interest rates and amounts outstanding—
commercial and BIF-insured banks
A17 Bank debits and deposit turnover
COMMERCIAL BANKING INSTITUTIONS
A18 Assets and liabilities, Wednesday figures
A28
A29
A30
A30
Federal fiscal and financing operations
U.S. budget receipts and outlays
Federal debt subject to statutory limitation
Gross public debt of U.S. Treasury—Types
and ownership
A31 U.S. government securities
dealers—Transactions
A32 U.S. government securities dealers—Positions
and financing
A3 3 Federal and federally sponsored credit
agencies—Debt outstanding
SECURITIES MARKETS AND
CORPORATE FINANCE
A34 New security issues—Tax-exempt state and local
governments and corporations
A35 Open-end investment companies—Net sales
and assets
A3 5 Corporate profits and their distribution
A35 Nonfarm business expenditures on new
plant and equipment
A36 Domestic finance companies—Assets and
liabilities, and consumer, real estate, and business
credit
2
Federal Reserve Bulletin • August 1994
Domestic Financial Statistics—Continued
REAL ESTATE
A37 Mortgage markets
A3 8 Mortgage debt outstanding
CONSUMER INSTALLMENT CREDIT
A39 Total outstanding
A39 Terms
FLOW OF FUNDS
A40
A42
A43
A44
Funds raised in U.S. credit markets
Summary of financial transactions
Summary of credit market debt outstanding
Summary of financial assets and liabilities
Domestic Nonfinancial Statistics
A54 Foreign official assets held at Federal Reserve
Banks
A55 Selected U.S. liabilities to foreign official
institutions
REPORTED BY BANKS
IN THE UNITED STATES
A55
A56
A58
A59
Liabilities to and claims on foreigners
Liabilities to foreigners
Banks' own claims on foreigners
Banks' own and domestic customers' claims on
foreigners
A59 Banks' own claims on unaffiliated foreigners
A60 Claims on foreign countries—Combined
domestic offices and foreign branches
REPORTED BYNONBANKING BUSINESS
ENTERPRISES IN THE UNITED STATES
A61 Liabilities to unaffiliated foreigners
A62 Claims on unaffiliated foreigners
SELECTED MEASURES
SECURITIES HOLDINGS AND TRANSACTIONS
A45 Nonfinancial business activity—Selected
measures
A45 Labor force, employment, and unemployment
A46 Output, capacity, and capacity utilization
A47 Industrial production—Indexes and gross value
A49 Housing and construction
A50 Consumer and producer prices
A51 Gross domestic product and income
A52 Personal income and saving
A63 Foreign transactions in securities
A64 Marketable U.S. Treasury bonds and
notes—Foreign transactions
International Statistics
INTEREST AND EXCHANGE RATES
A65 Discount rates of foreign central banks
A65 Foreign short-term interest rates
A66 Foreign exchange rates
A67 Guide to Statistical Releases and
Special Tables
SUMMARY STATISTICS
SPECIAL TABLES
A53 U.S. international transactions—Summary
A54 U.S. foreign trade
A54 U.S. reserve assets
A68 Terms of lending at commercial banks, May 1994
A72 Assets and liabilities of U.S. branches and agencies
of foreign banks, March 31, 1994
3
Guide to Tabular Presentation
SYMBOLS AND
c
e
n.a.
n.e.c.
p
r
*
0
. ..
ATS
BIF
CD
CMO
FFB
FHA
FHLBB
FHLMC
FmHA
FNMA
FSLIC
G-7
GENERAL
ABBREVIATIONS
Corrected
Estimated
Not available
Not elsewhere classified
Preliminary
Revised (Notation appears on column heading
when about half of the figures in that column
are changed.)
Amounts insignificant in terms of the last decimal
place shown in the table (for example, less than
500,000 when the smallest unit given is millions)
Calculated to be zero
Cell not applicable
Automatic transfer service
Bank insurance fund
Certificate of deposit
Collateralized mortgage obligation
Federal Financing Bank
Federal Housing Administration
Federal Home Loan Bank Board
Federal Home Loan Mortgage Corporation
Farmers Home Administration
Federal National Mortgage Association
Federal Savings and Loan Insurance Corporation
Group of Seven
G-10
GNMA
GDP
HUD
IMF
IO
IPCs
IRA
MMDA
MSA
NOW
OCD
OPEC
OTS
PO
REIT
REMIC
RP
RTC
SAIF
SCO
SDR
SIC
VA
Group of Ten
Government National Mortgage Association
Gross domestic product
Department of Housing and Urban
Development
International Monetary Fund
Interest only
Individuals, partnerships, and corporations
Individual retirement account
Money market deposit account
Metropolitan statistical area
Negotiable order of withdrawal
Other checkable deposit
Organization of Petroleum Exporting Countries
Office of Thrift Supervision
Principal only
Real estate investment trust
Real estate mortgage investment conduit
Repurchase agreement
Resolution Trust Corporation
Savings Association Insurance Fund
Securitized credit obligation
Special drawing right
Standard Industrial Classification
Department of Veterans Affairs
INFORMATION
In many of the tables, components do not sum to totals because;
of rounding.
Minus signs are used to indicate (1) a decrease, (2) a negative:
figure, or (3) an outflow.
"U.S. government securities" may include guaranteed issues
of U.S. government agencies (the flow of funds figures also
include not fully guaranteed issues) as well as direct obligations of the Treasury. "State and local government" also includes municipalities, special districts, and other political
subdivisions.
A4
DomesticNonfinancialStatistics • August 1994
1.10 RESERVES, MONEY STOCK, LIQUID ASSETS, AND DEBT MEASURES
Percent annual rate of change, seasonally adjusted1
1993
1994
1994
Monetary or credit aggregate
Q2
Q3
Q4
Q1
Jan.
Feb.r
Mar.r
Apr.
May
10.4
12.0
10.2
10.1
12.5
12.4
11.0
10.6
14.2
14.1
15.6
9.8
3.1
2.5
3.7
10.2
2.5
-5.2
2.7
11.7
3.2
9.5
3.3
13.4
-3.4
.0
-3.1
9.3
-7.4
-11.2
-8.8
6.3
-3.9
.8
-5.4
8.2
10.7
2.2
2.1
3.2rr
4.7
12.0r
2.5
1.0
\.(f
5.8r
9.4r
2.3r
2.51
1.9
4.9r
6.0r
1.8r
.2
2.6
5.7
5.4r
1.7r
1.2
4.7r
5.4
-1.3
-7.5
-2.7
4.7
4.0
4.7
2.4
1.7
5.2
-1.2
2.3
2.1
3.4
4.4
2.0
.3
-2.7
n.a.
n.a.
2
Reserves of depository institutions
1 Total
2 Required
3 Nonborrowed
4 Monetary base
J
6
7
8
9
Concepts of money, liquid assets, and debt4
Ml
M2
M3
L
Debt
Nontrgnsaction components
10 InM2 y . . . .
11 In M3 only6
-1.4
1.6
-1.7
-6.7
-.8 rr
3.8
-.r
-8.6 r
,<f
—2.0r
-4.4
-41.0
5.0
-10.5
3.9
1.1
-.5
-19.9
5.1
-9.2
-.7
4.9
-10.6
-7.7
3.6
-7.4r
-,4
4.3r
-5.2r
-3.6
7.3
-7.7 r
10.4
1.5
-4.1
-23.6
-1.2
-3.4
-17.5
-3.2
-2.6
-3.1
-6.2
6.2
16.9
.7
-11.9
-8.5
2.3
-14^
-4.5
-.4
-9.5 r
-6.7
,4r
-11.5 r
-9.3
.0
-11.7 r
3.9
-1.4
-13.4
-5.8
5.3
-7.3
-15.6
2.2
-6.2
5.9
-1.9
-7.0
-27.5
Money market mutual funds
18 General purpose and broker-dealer
19 Institution-only
.2
-2.2
-1.8
-10.5
1.2
8.8
-.r
-26.7
-3.4
-26.2
-14.1
-98.4
16.4
3.4
45.1
-2.7
12.0
-52.2
Debt components*
20 Federal
21 Nonfederal
10.4r
2.6
5.5
4.6r
7.1
5.2
3.(f
7.1r
5.2
4.6
9.0
3.8
2.9
5.0
Time and savings deposits
Commercial banks
Savings, including MMDAs
Small time78 9
Large time '
Thrift institutions
15 Savings, including
MMDAs
lb Small time7
17 Large time '
12
13
14
1. Unless otherwise noted, rates of change are calculated from average
amounts outstanding during preceding month or quarter.
2. Figures incorporate adjustments for discontinuities, or "breaks," associated with regulatory changes in reserve requirements. (See also table 1.20.)
3. The seasonally adjusted, break-adjusted monetary base consists of (1)
seasonally adjusted, break-adjusted total reserves (line 1), plus (2) the seasonally
adjusted currency component of the money stock, plus (3) (for all quarterly
reporters on the "Report of Transaction Accounts, Other Deposits, and Vault
Cash" and for all weekly reporters whose vault cash exceeds their required
reserves) the seasonally adjusted, break-adjusted difference between current vault
cash and the amount applied to satisfy current reserve requirements.
4. Composition of the money stock measures and debt is as follows:
Ml: (1) currency outside the U.S. Treasury, Federal Reserve Banks, and the
vaults of depository institutions, (2) travelers checks of nonbank issuers, (3)
demand deposits at all commercial banks other than those owed to depository
institutions, the U.S. government, and foreign banks and official institutions, less
cash items in the process of collection and Federal Reserve float, and (4) other
checkable deposits (OCDs), consisting of negotiable order of withdrawal (NOW)
and automatic transfer service (ATS) accounts at depository institutions, credit
union share draft accounts, and demand deposits at thrift institutions. Seasonally
adjusted Ml is computed by summing currency, travelers checks, demand
deposits, and OCDs, each seasonally adjusted separately.
M2: Ml plus (1) overnight (and continuing-contract) repurchase agreements
(RPs) issued by aU depository institutions and overnight Eurodollars issued to
U.S. residents by foreign branches of U.S. banks worldwide, (2) savings (including MMDAs) and smaU time deposits (time deposits—including retail RPs—in
amounts of less than $100,000), and (3) balances in both taxable and tax-exempt
general-purpose and broker-dealer money market funds. Excludes individual
retirement accounts (IRAs) and Keogh balances at depository institutions and
money market funds. Also excludes all balances held by U.S. commercial banks,
money market funds (general purpose and broker-dealer), foreign governments
and commercial banks, and the U.S. government. Seasonally adjusted M2 is
computed by adjusting its non-Mi component as a whole and then adding this
result to seasonally adjusted Ml.
M3: M2 plus (1) large time deposits and term RP liabilities (in amounts of
$100,000 or more) issued by all depository institutions, (2) term Eurodollars held
by U.S. residents at foreign branches of U.S. banks worldwide and at all banking
offices in the United Kingdom and Canada, and (3) balances in both taxable and
9.2r
4.6
n.a.
n.a.
tax-exempt, institution-only money market funds. Excludes amounts held by
depository institutions, the U.S. government, money market funds, and foreign
banks and official institutions. Also excluded is the estimated amount of overnight
RPs and Eurodollars held by institution-only money market funds. Seasonally
adjusted M3 is computed by adjusting its non-M2 component as a whole and then
adding this result to seasonally adjusted M2.
L: M3 plus the nonbank public holdings of U.S. savings bonds, short-term
Treasury securities, commercial paper, and bankers acceptances, net of money
market fund holdings of these assets. Seasonally adjusted L is computed by
summing U.S. savings bonds, short-term Treasury securities, commercial paper,
and bankers acceptances, each seasonally adjusted separately, and then adding
this result to M3.
Debt: Debt of domestic nonfinancial sectors consists of outstanding credit
market debt of the U.S. government, state and local governments, and private
nonfinancial sectors. Private debt consists of corporate bonds, mortgages, consumer credit (including bank loans), other bank loans, commercial paper, bankers
acceptances, and other debt instruments. Data are derived from the Federal
Reserve Board's flow of funds accounts. Data on debt of domestic nonfinancial
sectors are monthly averages, derived by averaging adjacent month-end levels.
Growth rates for debt reflect adjustments for discontinuities over time in the levels
of debt presented in other tables.
5. Sum of (1) overnight RPs and Eurodollars, (2) money market fund balances
(general purpose and broker-dealer), (3) savings deposits (including MMDAs),
and (4) small time deposits.
6. Sum of (1) large time deposits, (2) term RPs, (3) term Eurodollars of U.S.
residents, and (4) money market fund balances (institution-only), less (5) a
consolidation adjustment that represents the estimated amount of overnight RPs
and Eurodollars held by institution-only money market funds. This sum is
seasonally adjusted as a whole.
7. Small time deposits—including retail RPs—are those issued in amounts of
less than $100,000. All IRA and Keogh account balances at commercial banks and
thrift institutions are subtracted from small time deposits.
8. Large time deposits are those issued in amounts of $100,000 or more,
excluding those booked at international banking facilities.
9. Large time deposits at commercial banks less those held by money market
funds, depository institutions, U.S. government and foreign banks and official
institutions.
Money Stock and Bank Credit
A5
1.11 RESERVES OF DEPOSITORY INSTITUTIONS AND RESERVE BANK CREDIT 1
Millions of dollars
Average of
daily figures
Average of daily figures for week ending on date indicated
1994
1994
Apr. 13
Apr. 20
Apr. 27
May 4
May 11
May 18
May 25
382,760
380,871
384,4%
382,062
383,059
382,150
382,315
382,550
343,765
1,376
338,384
3,975
343,611
2,366
343,561
0
344,217
0
343,133
655
343,419
1,449
344,147
1,716
4,115
99
0
4,019
414
0
4,145
131
0
4,101
143
0
4,076
0
0
4,047
0
0
4,040
106
0
4,022
136
0
4,016
942
0
41
24
0
585
32,391
61
55
0
628
33,783
65
134
0
402
32,584
54
42
0
452
33,689
35
53
0
335
33,852
67
74
0
400
33,883
90
93
0
603
34,009
46
110
0
482
33,576
122
133
0
446
32,588
30
148
0
20
31,531
11,053
8,018
22,265
11,052
8,018
22,327
11,052
8,018
22,387
11,052
8,018
22,316
11,052
8,018
22,330
11,052
8,018
22,344
11,052
8,018
22,358
11,052
8,018
22,372
11,052
8,018
22,386
11,052
8,018
22,400
366,753
377
370,738
376
374,164
373
371,284
376
371,152
378
370,552
378
371,452
378
373,405
378
374,032
375
374,016
373
5,122
189
5,701
248
6,174
185
3,965
209
6,568
330
5,473
213
8,992
170
6,067
160
5,997
205
5,287
215
6,565
358
6,371
311
6,092
304
6,231
303
6,714
297
6,308
309
6,322
322
6,163
308
6,061
318
6,017
282
Mar.
Apr.
May
1 Reserve Bank credit outstanding
U.S. government securities2
2
Bought outright—System account
3
Held under repurchase agreements . . .
Federal agency obligations
4
Bought outright
5
Held under repurchase agreements . . .
6 Acceptances
Loans to depository institutions
7
Adjustment credit
8
Seasonal credit
9
Extended credit
10 Float
11 Other Federal Reserve assets
375,629
382,420
335,371
2,721
341,226
2,452
4,235
261
0
12 Gold stock
13 Special drawing rights certificate account .
14 Treasury currency outstanding
SUPPLYING RESERVE FUNDS
ABSORBING RESERVE FUNDS
15 Currency in circulation
16 Treasury cash holdings
Deposits, other than reserve balances, with
Federal Reserve Banks
17 Treasury
18 Foreign
19 Service-related balances and
adjustments
20 Other
21 Other Federal Reserve liabilities and
capital
22 Reserve balances with Federal
Reserve Banks
10,066
10,386
10,426
10,740
10,144
10,132
10,170
10,363
10,440
10,489
27,536r
29,685
26,500
29,149
30,313
30,111
26,682
26,747
26,343
27,342
Wednesday figures
End-of-month figures
Apr. 13
Apr. 20
Apr. 27
May 4
May 11
May 18
May 25
386,651
378,045
384,970
382,112
385,820
380,611
381,730
383,834
344,365
4,405
338,513
374
343,454
3,034
343,160
0
346,650
0
342,801
0
342,512
2,016
346,899
375
4,047
0
0
3,977
1,300
0
4,102
0
0
4,098
0
0
4,047
0
0
4,047
0
0
4,022
0
0
4,022
955
0
3,977
725
0
426
37
0
444r
33,424
151
82
0
48
34,168
76
164
0
495
31,869
187
43
0
1,313
33,513
60
67
0
169
34,088
75
83
0
753
33,994
46
105
0
1,371
33,601
34
121
0
266
33,367
48
140
0
638
31,400
35
165
0
37
31,622
11,052
8,018
22,302
11,053
8,018
22,358
11,052
8,018
22,414
11,052
8,018
22,316
11,053
8,018
22,330
11,052
8,018
22,344
11,052
8,018
22,358
11,052
8,018
22,372
11,052
8,018
22,386
11,053
8,018
22,400
369,016
370
370,677
378
377,892
361
372,074
378
371,389
378
371,556
378
373,055
379
374,706
375
374,582
373
375,694
361
6,181
454
7,965
171
5,675
174
3,904
209
9,166
235
7,543
200
10,373
164
6,330
171
5,131
178
5,594
222
6,232r
316
6,322
312
5,981
278
6,231
274
6,714
305
6,308
308
6,322
319
6,163
308
6,061
314
6,017
297
10,618
10,189
10,836
9,955
9,993
9,989
9,991
10,195
10,295
10,291
28,190
27,245
26,645
23,804
26,252
26,829
Mar.
Apr.
May
1 Reserve Bank credit outstanding
U.S. government securities2
Bought outright—System account .
Held under repurchase agreements
Federal agency obligations
Bought outright
Held under repurchase agreements
Acceptances
Loans to depository institutions
Adjustment credit
Seasonal credit
Extended credit
Float
Other Federal Reserve assets
381,269r
381,576
337,260
5,300
343,079
0
4,227
150
0
12 Gold stock
13 Special drawing rights certificate account
14 Treasury currency outstanding
SUPPLYING RESERVE FUNDS
ABSORBING RESERVE FUNDS
15 Currency in circulation
16 Treasury cash holdings
Deposits, other than reserve balances, with
Federal Reserve Banks
17 Treasury
18 Foreign
19 Service-related balances and
adjustments
20 Other
21 Other Federal Reserve liabilities and
capital
22 Reserve balances wjth Federal
Reserve Banks
r
29,455
26,990
26,939
1. For amounts of cash held as reserves, see table 1.12.
2. Includes securities loaned—fully guaranteed by U.S. government securities
pledged with Federal Reserve Banks—and excludes securities sold and scheduled
to be bought back under matched sale-purchase transactions.
26,405
3. Excludes required clearing balances and adjustments to compensate for
float.
A6
DomesticNonfinancialStatistics • August 1994
1.12 RESERVES AND BORROWINGS
Depository Institutions1
Millions of dollars
Prorated monthly averages of biweekly averages
Reserve classification
1
2
3
4
5
6
7
8
9
10
Reserve balances with Reserve Banks2
Total vault cash
Applied vault cash
Surplus vault cash
Total reserves6
Required reserves
Excess reserve balances at Reserve Banks . . .
Total borrowings at Reserve Banks
Seasonal borrowings
Extended credit9
1991
1992
1993
Dec.
Dec.
Dec.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
May
26,659
32,509
28,872
3,637
55,532
54,553
979
192
38
1
25,368
34,542
31,172
3,370
56,540
55,385
1,155
124
18
1
29,374
36,812
33,484
3,328
62,858
61,795
1,063
82
31
0
29,018
35,655
32,278
3,377
61,296
60,195
1,101
89
75
0
29,374
36,812
33,484
3,328
62,858
61,795
1,063
82
31
0
27,817
37,907
34,254
3,653
62,072
60,624
1,448
73
15
0
26,922
36,295
32,671
3,624
59,593
58,454
1,140
- 70
15
0
27,396r
35,585
32,208
3,377
59,605r
58,638r
967
55
24
0
29,614
35,215
32,027
3,188
61,641
60,489
1,151
124
57
0
26,791
35,892
32,484
3,408
59,275
58,358
917
200
134
0
1993
1994
Biweekly averages of daily figures for weeks ending on date indicated
1994
1 Reserve balances with Reserve Banks2
2 Total vault cash3
3 Applied vault cash
4 Surplus vault6 cash
5 Total reserves
6 Required reserves
7 Excess reserve balances at Reserve Banks . . .
8 Total borrowings at Reserve Banks
9 Seasonal borrowings
10 Extended credit9
Feb. 2
Feb. 16
Mar. 2
Mar. 16
Mar. 30
Apr. 13r
Apr. 27
May 11
May 25
June 8
25,672
38,108
34,152
3,957
59,824
58,557
1,267
45
18
0
26,339
37,475
33,651
3,824
59,989
58,878
1,112
95
15
0
27,811
34,617
31,282
3,335
59,093
57,942
1,151
45
15
0
27,139
36,654
33,105
3,549
60,244
59,192
1,052
39
17
0
27,434
34,667
31,440
3,227
58,874r
58,013r
861
68
32
0
29,641
35,434
32,268
3,167
61,909
61,012
897
125
40
0
30,212
34,748
31,599
3,150
61,810
60,350
1,460
114
64
0
26,702
36,447
32,983
3,464
59,684
58,871
814
170
102
0
26,848
35,320
31,952
3,368
58,800
57,881
919
216
141
0
26,820
36,209
32,812
3,397
59,632
58,531
1,101
218
176
0
1. Data in this table also appear in the Board's H.3 (502) weekly statistical
release. For ordering address, see inside front cover.
2. Excludes required clearing balances and adjustments to compensate for float
and includes other off-balance-sheet "as-of' adjustments.
3. Total "lagged" vault cash held by depository institutions subject to reserve
requirements. Dates refer to the maintenance periods during which the vault cash
can be used to satisfy reserve requirements. The maintenance period for weekly
reporters ends sixteen days after the lagged computation period during which the
vault cash is held. Before Nov. 25,1992, the maintenance period ended thirty days
after the lagged computation period.
4. All vault cash held during the lagged computation period by "bound"
institutions (that is, those whose required reserves exceed their vault cash) plus
the amount of vault cash applied during the maintenance period by "nonbound"
institutions (that is, those whose vault cash exceeds their required reserves) to
satisfy current reserve requirements.
5. Total vault cash (line 2) less applied vault cash (line 3).
6. Reserve balances with Federal Reserve Banks (line 1) plus applied vault cash
(line 3).
7. Total reserves (line 5) less required reserves (line 6).
8. Also includes adjustment credit.
9. Consists of borrowing at the discount window under the terms and conditions established for the extended credit program to help depository institutions
deal with sustained liquidity pressures. Because there is not the same need to
repay such borrowing promptly as with traditional short-term adjustment credit,
the money market impact of extended credit is similar to that of nonborrowed
reserves.
Money Stock and Bank Credit
1.13 SELECTED BORROWINGS IN IMMEDIATELY AVAILABLE FUNDS
A7
Large Banks1
Millions of dollars, averages of daily figures
1994, week ending Monday
Source and maturity
1
2
3
4
5
6
7
8
Federal funds purchased, repurchase agreements, and
other selected borrowings
From commercial banks in the United States
For one day or under continuing contract
For all other maturities
From other depository institutions, foreign banks and
official institutions, and U.S. government agencies
For one day or under continuing contract
For all other maturities
Repurchase agreements on U.S. government and federal
agency securities
Brokers and nonbank dealers in securities
For one day or under continuing contract
For all other maturities
All other customers
For one day or under continuing contract
For all other maturities
Apr. 4
Apr. 11
Apr. 18
Apr. 25
May 2
May 9
May 16
May 23
May 30
72,139
13,350
71,680
11,424
69,568
12,785
63,648
13,226
65,833
12,976
68,573
12,781
68,148
12,765
66,700
12,498
66,665
12,504
23,688
20,146
24,751
19,158
21,512
19,909
22,378
21,662
18,933
19,425
18,210
20,093
20,401
21,017
23,418
21,742
20,452
21,704
20,969
36,030
26,002
35,477
25,591
37,190
23,001
34,276
20,226
33,846
22,298
33,538
23,630
29,969
24,001
29,841
22,351
34,067
28,186
19,496
31,750
16,099
31,907
16,396
29,831
16,464
30,306
16,845
29,046
15,869
30,238
15,570
31,458
16,644
31,843
16,442
52,960
23,638
43,928
25,634
45,846
24,176
48,620
21,753
52,788
22,402
48,864
21,618
53,700
24,802
50,909
23,001
50,373
23,592
MEMO
Federal funds loans and resale agreements in
immediately available funds in maturities of one day
or under continuing contract
States
9 To commercial banks in the United
10 To all other specified customers2
1. Banks with assets of $4 billion or more as of Dec. 31, 1988.
Data in this table also appear in the Board's H.5 (507) weekly statistical release.
For ordering address, see inside front cover.
2. Brokers and nonbank dealers in securities, other depository institutions,
foreign banks and official institutions, and U.S. government agencies.
A8
DomesticNonfinancialStatistics • August 1994
1.14 FEDERAL RESERVE BANK INTEREST RATES
Percent per year
Current and previous levels
1
Seasonal credit2
Adjustment credit
Federal Reserve
Bank
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco . . .
Extended credit3
On
7/1/94
Effective date
Previous rate
On
7/1/94
Effective date
Previous rate
On
7/1/94
Effective date
Previous rate
3.5
5/17/94
5/17/94
5/17/94
5/18/94
5/17/94
5/17/94
3.0
4.35
6/23/94
6/23/94
6/23/94
6/23/94
6/23/94
6/23/94
4.35
4.85
6/23/94
6/23/94
6/23/94
6/23/94
6/23/94
6/23/94
4.85
5/17/94
5/17/94
5/17/94
5/17/94
5/17/94
5/17/94
3.5
3.0
4.35
6/23/94
6/23/94
6/23/94
6/23/94
6/23/94
6/23/94
4.35
4.85
6/23/94
6/23/94
6/23/94
6/23/94
6/23/94
6/23/94
4.85
Range of rates for adjustment credit in recent years4
Effective date
In effect Dec. 31, 1977
1978—Jan.
May
July
Aug.
Sept.
Oct.
Nov.
9
20
11
12
3
10
21
22
16
20
1
3
Range (or
level)—
All F.R.
Banks
6
6-6.5
6.5
6.5-7
7
7-7.25
7.25
7.75
8
8-8.5
8.5
8.5-9.5
9.5
1979—July 20
Aug. 17
20
Sept. 19
21
Oct. 8
10
10
10-10.5
10.5
10.5-11
11
11-12
12
1980—Feb. 15
19
May 29
30
June 13
16
29
July 28
Sept. 26
Nov. 17
Dec. 5
12-13
13
12-13
12
11-12
11
10
10-11
11
12
12-13
F.R.
Bank
of
N.Y.
6
6.5
6.5
7
7
7.25
7.25
7.75
8
8.5
8.5
9.5
9.5
10
10.5
10.5
11
11
12
12
13
13
13
12
11
11
10
10
11
12
13
Effectivf
1981—May
5
Nov. ?
6
Dec. 4
1982—July 70
73
Aug. 7,
3
16
77
30
Oct. 1?
13
Nov. 7?
?6
Dec. 14
15
17
13-14
14
13-14
13
12
F.R.
Bank
of
N.Y.
14
14
13
13
12
11.5-12
11.5
11-11.5
11
10.5
10-10.5
10
9.5-10
9.5
9-9.5
9
8.5-9
8.5-9
8.5
11.5
11.5
11
11
10.5
10
10
9.5
9.5
9
9
9
8.5
8.5
1984—Apr.
9
13
Nov. 71
76
Dec. 74
8.5-9
9
8.5-9
8.5
8
9
9
8.5
8.5
8
1985—May 70
74
7.5-8
7.5
7.5
7.5
1986—Mar. 7
10
Apr. 71
July 11
7-7.5
7
6.5-7
6
7
7
6.5
6
1. Available on a short-term basis to help depository institutions meet temporary needs for funds that cannot be met through reasonable alternative sources.
The highest rate established for loans to depository institutions may be charged on
adjustment-credit loans of unusual size that result from a major operating problem
at the borrower's facility.
2. Available to help relatively small depository institutions meet regular
seasonal needs for funds that arise from a clear pattern of intrayearly movements
in their deposits and loans and that cannot be met through special industry
lenders. The discount rate on seasonal credit takes into account rates on market
sources of funds and ordinarily is reestablished on the first business day of each
two-week reserve maintenance period; however, it is never less than the discount
rate applicable to adjustment credit.
3. May be made available to depository institutions when similar assistance is
not reasonably available from other sources, including special industry lenders.
Such credit may be provided when exceptional circumstances (including sustained deposit drains, impaired access to money market funds, or sudden
deterioration in loan repayment performance) or practices involve only a particular institution, or to meet the needs of institutions experiencing difficulties
adjusting to changing market conditions over a longer period (particularly at times
of deposit disintermediation). The discount rate applicable to adjustment credit
Range (or
level)—
All F.R.
Banks
Range (or
level)—
All F.R.
Banks
F.R.
Bank
of
N.Y.
1986—Aug. 21
22
5.5-6
5.5
5.5
5.5
1987—Sept. 4
11
5.5-6
6
6
6
1988—Aug. 9
11
6-6.5
6.5
6.5
6.5
1989—Feb. 24
27
6.5-7
7
7
7
Effective date
1990—Dec. 19
1991—Feb.
1
4
Apr. 30
May 2
Sept. 13
17
Nov. 6
7
Dec. 20
24
1992—July
2
7
In effect July 1, 1994
6.5
6.5
6-6.5
6
5.5-6
5.5
5-5.5
5
4.5-5
4.5
3.5-4.5
3.5
6
6
5.5
5.5
5
5
4.5
4.5
3.5
3.5
3-3.5
3
3.5
3
3
3.5
ordinarily is charged on extended-credit loans outstanding less than thirty days;
however, at the discretion of the Federal Reserve Bank, this time period may be
shortened. Beyond this initial period, a flexible rate somewhat above rates on
market sources of funds is charged. The rate ordinarily is reestablished on the first
business day of each two-week reserve maintenance period, but it is never less
than the discount rate applicable to adjustment credit plus SO basis points.
4. For earlier data, see the following publications of the Board of Governors:
Banking and Monetary Statistics, 1914-1941, and 1941-1970-, and the Annual
Statistical Digest, 1970-1979.
In 1980 and 1981, the Federal Reserve applied a surcharge to short-term
adjustment-credit borrowings by institutions with deposits of $500 million or more
that had borrowed in successive weeks or in more than four weeks in a calendar
quarter. A 3 percent surcharge was in effect from Mar. 17, 1980, through May 7,
1980. A surcharge of 2 percent was reimposed on Nov. 17, 1980; the surcharge
was subsequently raised to 3 percent on Dec. 5,1980, and to 4 percent on May 5,
1981. The surcharge was reduced to 3 percent effective Sept. 22, 1981, and to 2
percent effective Oct. 12, 1981. As of Oct. 1, 1981, the formula for applying the
surcharge was changed from a calendar quarter to a moving thirteen-week period.
The surcharge was eliminated on Nov. 17, 1981.
Policy Instruments
A9
1.15 RESERVE REQUIREMENTS OF DEPOSITORY INSTITUTIONS1
Type of deposit
Net transaction accounts
1 $0 million-$51.9 million...
2 More than $51.9 million4..
12/21/93
12/21/93
3 Nonpersonal time deposits5
12/27/90
4 Eurocurrency liabilities6. .
12/27/90
1. Required reserves must be held in the form of deposits with Federal Reserve
Banks or vault cash. Nonmember institutions may maintain reserve balances with
a Federal Reserve Bank indirectly on a pass-through basis with certain approved
institutions. For previous reserve requirements, see earlier editions of the Annual
Report or the Federal Reserve Bulletin. Under provisions of the Monetary
Control Act, depository institutions include commercial banks, mutual savings
banks, savings and loan associations, credit unions, agencies and branches of
foreign banks, and Edge Act corporations.
2. The Garn-St Germain Depository Institutions Act of 1982 (Public Law
97-320) requires that $2 million of reservable liabilities of each depository
institution be subject to a zero percent reserve requirement. The Board is to adjust
the amount of reservable liabilities subject to this zero percent reserve requirement each year for the succeeding calendar year by 80 percent of the percentage
increase in the total reservable liabilities of all depository institutions, measured
on an annual basis as of June 30. No corresponding adjustment is to be made in
the event of a decrease. On Dec. 21, 1993, the exemption was raised from $3.8
million to $4.0 million. The exemption applies in the following order: (1) net
negotiable order of withdrawal (NOW) accounts (NOW accounts less allowable
deductions); and (2) net other transaction accounts. The exemption applies only to
accounts that would be subject to a 3 percent reserve requirement.
3. Includes all deposits against which the account holder is permitted to make
withdrawals by negotiable or transferable instruments, payment orders of withdrawal, and telephone and preauthorized transfers for the purpose of making
payments to third persons or others, other than money market deposit accounts
(MMDAs) and similar accounts that permit no more than six preauthorized,
automatic, or other transfers per month, of which no more than three may be
checks. Accounts subject to such limits are savings deposits.
The Monetary Control Act of 1980 requires that the amount of transaction
accounts against which the 3 percent reserve requirement applies be modified
annually by 80 percent of the percentage change in transaction accounts held by
all depository institutions, determined as of June 30 each year. Effective Dec. 21,
1993, for institutions reporting quarterly and weekly, the amount was increased
from $46.8 million to $51.9 million.
4. The reserve requirement was reduced from 12 percent to 10 percent on
Apr. 2, 1992, for institutions that report weekly, and on Apr. 16, 1992, for
institutions that report quarterly.
5. For institutions that report weekly, the reserve requirement on nonpersonal
time deposits with an original maturity of less than IVi years was reduced from 3
percent to IVi percent for the maintenance period that began Dec. 13, 1990, and
to zero for the maintenance period that began Dec. 27, 1990. The reserve
requirement on nonpersonal time deposits with an original maturity of IVi years
or more has been zero since Oct. 6, 1983.
For institutions that report quarterly, the reserve requirement on nonpersonal
time deposits with an original maturity of less than IVi years was reduced from 3
percent to zero on Jan. 17, 1991.
6. The reserve requirement on Eurocurrency liabilities was reduced from 3
percent to zero in the same manner and on the same dates as was the reserve
requirement on nonpersonal time deposits with an original maturity of less than
1 Vi years (see note 5).
A10 Domestic Financial Statistics • August 1994
1.17 FEDERAL RESERVE OPEN MARKET TRANSACTIONS1
Millions of dollars
1993
Type of transaction
and maturity
1991
1992
1994
1993
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
U . S . TREASURY SECURITIES
Outright transactions (excluding matched
transactions)
Treasury bills
1 Gross purchases
2 Gross sales
3 Exchanges
4 Redemptions
Others within one year
5 Gross purchases
6 Gross sales
7 Maturity shifts
8 Exchanges
9 Redemptions
One to five years
10 Gross purchases
11 Gross sales
12 Maturity shifts
13 Exchanges
Five to ten years
14 Gross purchases
15 Gross sales
16 Maturity shifts
17 Exchanges
More than ten years
18 Gross purchases
19 Gross sales
20 Maturity shifts
21 Exchanges
All maturities
22 Gross purchases
23 Gross sales
24 Redemptions
Matched transactions
25 Gross sales
26 Gross purchases
Repurchase agreements
27 Gross purchases
28 Gross sales
20,158
120
277,314
1,000
14,714
1,628
308,699
1,600
17,717
0
332,229
468
1,396
0
25,783
468
5,911
0
27,641
0
1,394
0
33,536
0
0
0
28,986
0
1,264
0
28,709
0
900
0
33,163
0
1,101
0
28,881
0
3,043
0
24,454
-28,090
1,000
1,096
0
36,662
-30,543
0
1,223
0
31,368
-36,582
0
0
0
913
-1,566
0
0
0
5,158
-7,641
0
189
0
2,910
-2,910
0
0
0
0
0
0
0
0
0
0
0
147
0
0
0
0
209
0
0
0
0
6,583
0
-21,211
24,594
13,118
0
-34,478
25,811
10,350
0
-27,140
0
0
0
-31
1,566
100
0
-4,689
5,341
2,619
0
-2,910
2,910
0
0
0
0
0
0
0
0
1,413
0
0
0
2,817
0
0
0
1,280
0
-2,037
2,894
2,818
0
-1,915
3,532
4,168
0
0
0
0
0
-882
0
0
0
-272
2,300
1,008
0
0
0
0
0
0
0
0
0
0
0
1,103
0
0
0
1,117
0
0
0
375
0
-1,209
600
2,333
0
-269
1,200
3,457
0
0
0
0
0
0
0
0
0
-197
0
826
0
0
0
0
0
0
0
0
0
0
0
618
0
0
0
896
0
0
0
31,439
120
1,000
34,079
1,628
1,600
36,915
0
468
1,396
0
468
6,011
0
0
6,035
0
0
0
0
616
1,264
0
0
4,181
0
0
6,140
0
440
1,570,456 1,482,467 1,475,085
1,571,534 1,480,140 1,475,941
115,160
112,837
109,941
112,772
137,645
136,821
132,872
133,468
124,125
124,270
155,950
155,625
120,393
134,051
310,084
311,752
378,374
386,257
475,447
470,723
27,693
30,397
38,493
34,072
33,751
29,577
25,818
29,348
33,693
37,425
38,490
38,115
19,741
25,041
29,729
20,642
42,027
-4,099
13,263
9,386
-3,550
-2,323
4,232
14,058
0
5
292
0
0
632
0
0
1,072
0
0
70
0
0
15
0
0
81
0
0
202
0
0
102
0
0
108
0
0
180
Repurchase agreements
33 Gross purchases
34 Gross sales
22,807
23,595
14,565
14,486
35,063
34,669
3,812
5,509
2,841
2,861
2,211
1,615
2,600
3,106
3,277
3,636
3,160
3,170
728
878
35 Net change in federal agency obligations
-1,085
-554
-678
-1,767
-35
515
-708
-461
-118
-330
36 Total net change in System Open Market
Account
28,644
20,089
41,348
-5,866
13,228
9,901
-4,258
-2,784
4,114
13,728
29 Net change in U.S. Treasury securities
FEDERAL AGENCY OBLIGATIONS
Outright transactions
30 Gross purchases
31 Gross sales
32 Redemptions
1. Sales, redemptions, and negative figures reduce holdings of the System Open
Market Account; all other figures increase such holdings.
Federal Reserve Banks
1.18 FEDERAL RESERVE BANKS
Millions of dollars
All
Condition and Federal Reserve Note Statements1
End of month
Wednesday
Account
Apr. 27
May 4
May 11
May 18
May 25
Mar. 31
Apr. 30
May 31
Consolidated condition statement
1 Gold certificate account
2 Special drawing rights certificate account
3 Coin
Loans
4 To depository institutions
5 Other.'
6 Acceptances held under repurchase agreements .
Federal agency obligations
7 Bought outright
8 Held under repurchase agreements
11,052
8,018
415
11,052
8,018
411
11,052
8,018
406
11,052
8,018
397
11,053
8,018
380
11,052
8,018
435
11,053
8,018
429
11,052
8,018
357
158
0
0
151
0
0
154
0
0
188
0
0
200
0
0
463
0
0
234
0
0
240
0
0
4,047
0
4,047
0
4,022
0
4,022
955
3,977
725
4,227
150
4,047
0
3,977
1,300
343,160
346,650
342,801
344,528
347,274
342,560
343,079
348,770
10 Bought outright
11 BiHs
12 Notes
13 Bonds
14 Held under repurchase agreements
343,160
164,248
137,445
41,467
0
346,650
167,737
137,445
41,467
0
342,801
163,889
137,445
41,467
0
342,512
163,600
138,531
40,381
2,016
346,899
167,981
138,536
40,381
375
337,260
162,947
133,858
40,455
5,300
343,079
164,167
137,445
41,467
0
344,365
165,297
138,686
40,381
4,405
15 Total loans and securities
347,365
350,848
346,978
349,693
352,176
347,400
347,360
354,287
2,412
1,058
9 Total U.S. Treasury securities.
16 Items in process of collection
17 Bank premises
Other assets
18 Denominated
in foreign currencies3
19 All other4
20 Total assets
6,135
1,056
6,929
1,056
5,296
1,057
5,572
1,057
4,756
1,057
4,735
1,054
4,571
1,055
23,115
9,808
22,911
9,833
22,208
10,058
22,225
8,072
22,242
8,308
23,297
9,021
23,149
9,967
22,349
8,673
406,964
411,058
405,074
406,086
407,989
405,013
405,602
408,207
LIABILITIES
350,006
351,487
353,116
352,967
354,036
347,520
349,127
356,197
22 Total deposits
41,866
43,711
36,866
37,778
39,105
42,683
41,922
39,306
2i
23
24
25
26
33,816
7,543
200
308
32,855
10,373
164
319
30,057
6,330
171
308
32,155
5,131
178
314
32,995
5,594
222
297
35,733
6,181
454
316
33,474
7,965
171
312
33,186
5,675
174
278
5,104
2,705
5,869
2,707
4,897
2,879
5,047
2,947
4,558
2,924
4,192
2,684
4,363
2,763
1,868
3,106
399,681
403,774
397,758
398,739
400,623
397,080
398,176
400,477
3,479
3,401
403
3,484
3,401
399
3,483
3,401
432
3,516
3,401
431
3,517
3,401
448
3,445
3,401
1,088
3,479
3,401
546
3,517
3,401
811
406,964
411,058
405,074
406,086
407,989
405,013
405,602
408,207
368,705
370,716
372,683
363,985
365,291
371,757
367,031
372,886
21 Federal Reserve notes
Depository institutions
U.S. Treasury—General account
Foreign—Official accounts
Other
27 Deferred credit items
28 Other liabilities and accrued dividends
29 Total liabilities.
CAPITAL ACCOUNTS
30 Capital paid in
31 Surplus
32 Other capital accounts.
33 Total liabilities and capital accounts
MEMO
34 Marketable U.S. Treasury securities held in custody for
foreign and international accounts
Federal Reserve note statement
35 Federal Reserve notes outstanding (issued to Banks).
36 LESS: Held by Federal Reserve Banks
37 Federal Reserve notes, net
38
39
40
41
Collateral held against notes, net:
Gold certificate account
Special drawing rights certificate account.
Other eligible assets
U.S. Treasury and agency securities
42 Total collateral.
419,232
69,226
350,006
419,474
67,987
351,487
420,397
67,281
353,116
420,722
67,755
352,967
420,919
66,883
354,036
414,534
67,014
347,520
419,336
70,209
349,127
420,983
64,787
356,197
11,052
8,018
0
330,935
11,052
8,018
0
332,417
11,052
8,018
0
334,046
11,052
8,018
0
333,897
11,053
8,018
0
334,965
11,052
8,018
0
328,450
11,053
8,018
0
330,056
11,052
8,018
0
337,126
350,006
351,487
353,116
352,967
354,036
347,520
349,127
356,197
1. Some of the data in this table also appear in the Board's H.4.1 (503) weekly
statistical release. For ordering address, see inside front cover.
2. Includes securities loaned—fully guaranteed by U.S. Treasury securities
pledged with Federal Reserve Banks—and excludes securities sold and scheduled
to be bought back under matched sale-purchase transactions.
3. Valued monthly at market exchange rates.
4. Includes special investment account at the Federal Reserve Bank of Chicago
in Treasury bills maturing within ninety days.
5. Includes exchange-translation account reflecting the monthly revaluation at
market exchange rates of foreign exchange commitments.
A12
Domestic Financial Statistics • August 1994
1.19 FEDERAL RESERVE BANKS
Maturity Distribution of Loan and Security Holding
Millions of dollars
Type of holding and maturity
Wednesday
End of month
1994
1994
Apr. 27
May 4
May 11
May 18
May 25
Mar. 31
Apr. 29
May 31
1 Total loans
158
151
155
188
200
463
234
240
2 Within fifteen days1
3 Sixteen days to ninety days . . .
4 Ninety-one days to one year ..
148
10
0
75
75
0
74
80
0
171
17
0
176
24
0
445
18
0
1%
38
0
155
85
0
0
0
0
0
0
0
0
0
0
0
0
5 Total acceptances
6 Within fifteen days
7 Sixteen days to ninety days . . .
8 Ninety-one days to one year ..
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
9 Total U.S. Treasury securities..
343,160
346,650
342,801
344,528
347,274
337,260
343,079
344,365
11,062
89,445
99,783
84,250
24,961
33,578
10,423
88,120
103,708
83,725
25,264
33,125
1
1
10 Within fifteen days
11 Sixteen days to ninety days . . .
12 Ninety-one days to one year ..
13 One year to five years
14 Five years to ten years
15 More than ten years
17,576
79,084
103,711
84,250
24,961
33,578
23,851
80,294
98,809
85,157
24,961
33,578
16,713
79,744
102,649
85,157
24,961
33,578
18,845
78,334
104,939
84,021
25,264
33,125
20,859
78,589
105,410
84,026
25,264
33,125
9,213
77,058
112,661
81,093
24,553
32,682
16 Total federal agency obligations
4,047
4,047
4,022
4,977
4,702
4,227
4,047
3,977
Within fifteen days1
Sixteen days to ninety days . . .
Ninety-one days to one year ..
One year to five years
Five years to ten years
More than ten years
130
528
955
1,833
577
25
25
624
964
1,833
577
25
45
579
964
1,833
577
25
1,241
353
949
1,833
577
25
966
353
949
1,833
577
25
325
527
960
1,913
477
25
130
528
955
1,833
577
25
266
386
891
1,833
577
25
17
18
19
20
21
22
1. Holdings under repurchase agreements are classified as maturing within
fifteen days in accordance with maximum maturity of the agreements.
Monetary and Credit Aggregates
A13
1.20 AGGREGATE RESERVES OF DEPOSITORY INSTITUTIONS AND MONETARY BASE 1
Billions of dollars, averages of daily figures
1993
Item
1990
Dec.
1991
Dec.
1992
Dec.
1993
Dec.
Oct.
Total reserves3
Nonborrowed reserves
Nonborrowed reserves plus extended credit5
Required reserves
Monetary base6
Dec.
Jan.
Feb.
Mar.
Apr.
May
Seasonally adjusted
ADJUSTED FOR
CHANGES IN RESERVE REQUIREMENTS2
1
2
3
4
5
Nov.
1994
41.77 45.53
41.44 45.34
41.47 45.34
40.11 44.55
293.16 317.12
54.34 60.48
54.22 60.39
54.22 60.39
53.19 59.41
350.61 385.86
59.75 60.32
59.46 60.23
59.46 60.23
58.66 59.22
381.40 384.03
60.48 60.60
60.39 60.53
60.39 60.53
59.41 59.16
385.86 389.61
60.76 60.59
60.22 60.02
60.69 60.53
60.09 59.82
60.69 60.53r 60.09 59.82
59.62 59.62
59.06 59.10
393.96 397.01 399.09 401.83
Not seasonally adjusted
6
7
8
9
10
Total reserves
Nonborrowed reserves
Nonborrowed reserves plus extended credit ..
Required reserves
Monetary base9
60.67
60.58
60.58
59.57
384.29
62.37
62.29
62.29
61.31
390.59
60.04 61.30
59.75 61.21
59.75 61.21
58.95 60.20
387.51 391.14
1.06
1.09
1.10
.08
.29
.09
62.86
62.78
62.78
61.80
397.62
46.98
46.78
46.78
46.00
321.07
56.06 62.37
55.93 62.29
55.93 62.29
54.90 61.31
354.55 390.59
55.53
55.34
55.34
54.55
333.61
1.66
.98
.33
.19
56.54 62.86
56.42 62.78
56.42 62.78
55.39 61.80
360.90 397.62
43.07
42.74
42.77
41.40
296.68
59.48
59.20
59.20
58.39
380.80
62.04
61.96
61.96
60.59
391.00
59.53 59.50
59.46 59.44
59.46 59.44
58.39 58.53
390.86 394.15
61.40 58.97
61.27 58.77
61.27 58.77
60.25 58.06
399.76 400.26
NOT ADJUSTED FOR
CHANGES IN RESERVE REQUIREMENTS10
11
12
13
14
15
16
17
Total reserves11
Nonborrowed reserves
Nonborrowed reserves plus extended credit ..
Required reserves
Monetary base 13
Excess reserves
Borrowings from the Federal Reserve
59.12
58.80
58.82
57.46
313.70
1. Latest monthly and biweeklyfiguresare available from the Board's H.3 (502)
weekly statistical release. Historical data and estimates of the impact on required
reserves of changes in reserve requirements are available from the Monetary and
Reserves Projections Section, Division of Monetary Affairs, Board of Governors
of the Federal Reserve System, Washington, DC 20551.
2. Figures reflect adjustments for discontinuities, or "breaks," associated with
regulatory changes in reserve requirements. (See also table 1.10)
3. Seasonally adjusted, break-adjusted total reserves equal seasonally
adjusted, break-adjusted required reserves (line 4) plus excess reserves (line 16).
4. Seasonally adjusted, break-adjusted nonborrowed reserves equal seasonally
adjusted, break-adjusted total reserves (line 1) less total borrowings of depository
institutions from the Federal Reserve (line 17).
5. Extended credit consists of borrowing at the discount window under
the terms and conditions established for the extended credit program to help
depository institutions deal with sustained liquidity pressures. Because there is
not the same need to repay such borrowing promptly as with traditional shortterm adjustment credit, the money market impact of extended credit is similar to
that of nonborrowed reserves.
6. The seasonally adjusted, break-adjusted monetary base consists of (1)
seasonally adjusted, break-adjusted total reserves (line 1), plus (2) the seasonally
adjusted currency component of the money stock, plus (3) (for all quarterly
reporters on the "Report of Transaction Accounts, Other Deposits and Vault
Cash" and for all those weekly reporters whose vault cash exceeds their required
reserves) the seasonally adjusted, break-adjusted difference between current vault
cash and the amount applied to satisfy current reserve requirements.
7. Break-adjusted total reserves equal break-adjusted required reserves (line 9)
plus excess reserves (line 16).
8. To adjust required reserves for discontinuities that are due to regulatory
changes in reserve requirements, a multiplicative procedure is used to estimate
1.16
.12
61.64 59.28
62.07 59.59 59.61
61.52 59.08
62.00 59.52 59.55
61.52 59.08
62.00 59.52 59.55
60.49 58.36
60.62 58.45 58.64
397.89 397.93 400.78r 406.32 406.59
.92
1.14
1.15
1.06
1.45
,97
.20
.07
.12
.07
.06
what required reserves would have been in past periods had current reserve
requirements been in effect. Break-adjusted required reserves include required
reserves against transactions deposits and nonpersonal time and savings deposits
(but not reservable nondeposit liabilities).
9. The break-adjusted monetary base equals (1) break-adjusted total reserves
(line 6), plus (2) the (unadjusted) currency component of the money stock, plus (3)
(for all quarterly reporters on the "Report of Transaction Accounts, Other
Deposits and Vault Cash" and for all those weekly reporters whose vault cash
exceeds their required reserves) the break-adjusted difference between current
vault cash and the amount applied to satisfy current reserve requirements.
10. Reflects actual reserve requirements, including those on nondeposit liabilities, with no adjustments to eliminate the efFects of discontinuities associated
with changes in reserve requirements.
11. Reserve balances with Federal Reserve Banks plus vault cash used to
satisfy reserve requirements.
12. The monetary base, not break-adjusted and not seasonally adjusted,
consists of (1) total reserves (line 11), plus (2) required clearing balances and
adjustments to compensate for float at Federal Reserve Banks, plus (3) the
currency component of the money stock, plus (4) (for all quarterly reporters on
the "Report of Transaction Accounts, Other Deposits and Vault Cash" and for all
those weekly reporters whose vault cash exceeds their required reserves) the
difference between current vault cash and the amount applied to satisfy current
reserve requirements. Since the introduction of changes in reserve requirements
(CRR), currency and vault cash figures have been measured over the computation
periods ending on Mondays.
13. Unadjusted total reserves (line 11) less unadjusted required reserves (line 14).
A14
Domestic Financial Statistics • August 1994
1.21 MONEY STOCK, LIQUID ASSETS, AND DEBT MEASURES 1
BiUions of dollars, averages of daily figures
1994
Item
1990
Dec.
1991
Dec.
1992
Dec.
1993
Dec.
Feb/
Mar.r
Apr.
May
Seasonally adjusted
1
2
3
4
5
Measures2
Ml
M2
M3
L
Debt
6
7
8
9
Ml components
Currency3
Travelers checks 3
Demand deposits
Other checkable deposits6
826.4
3,353.0
4,125.7
4,974.8
10,670.1
897.7
3,455.3
4,180.4
4,992.9
11,147.3
1,024.8
3,509.0
4,183.0
5,057.1
ll,727.7r
1,128.4
3,567.4rr
4,229.4r
5,131.8
12,309.8r
1,138.6
3,568.7
4,207.0
5,140.5
12,419.8
1,142.4
3,582.7
4,215.3
5,147.7
12,473.3
1,141.3
3,589.5
4,222.8
5,162.2
12,519.2
1,143.2
3,590.4
4,213.2
n.a.
n.a.
246.7
7.8
277.9
294.0
267.1
7.7
290.0
332.8
292.2
8.1
339.6
384.9
321.4
7.9
384.8
414.3
329.2
7.9
390.3
411.2
332.4
8.0
390.0
411.9
334.8
8.1
388.9
409.5
337.6
8.1
385.8
411.6
2,526.6
772.7
2,557.6
725.2
2,484.3
674.0
2,439. l rr
662.0
2,430.2
638.3
2,440.3
632.7
2,448.2
633.3
2,447.2
622.8
Commercial banks
12 Savings deposits, including MMDAs
13 Small time deposits910,
.
14 Large time deposits 11
582.1
611.3
368.6
665.5
602.9
342.4
754.6
508.7
292.8
785.3
468.5 r
277. l
791.1
463.9
274.0
790.3
462.6
270.0
788.2
461.6
269.3
784.1
464.0
273.1
Thrift institutions
15 Savings deposits, including
MMDAs
16 Small time deposits9.
17 Large time deposits
338.3
563.2
120.9
375.6
464.5
83.4
429.0
361.8
67.5
430.2r
317.1
61.8
429.7
310.5
61.7
431.6
308.6
60.9
432.4
307.0
61.2
431.7
305.2
59.8
Money market mutual funds
18 General purpose and broker-dealer
19 Institution-only
355.5
135.0
370.4
181.0
352.0
201.5
348.8
197.0
343.7
176.9
348.4
177.4
361.5
177.0
365.1
169.3
2,490.7
8,179.4
2,763.8
8,383.5
3,068.4r
8,659.3
3,327.6rr
8,982. l
3,350.3
9,069.5
3,375.4
9,097.9
3,383.5
9,135.7
Nontransaction components
10 In M2;8
11 In M3
Debt components
20 Federal debt
21 Nonfederal debt
n.a.
n.a.
Not seasonally adjusted
22
23
24
25
26
Measures1
Ml
M2
M3
L
Debt
27
28
29
30
Ml components
Currency3
Travelers checks43
Demand deposits
Other checkable deposits6
843.8
3,366.0
4,135.5
4,997.2
10,667.7
916.7
3,470.4
4,191.9
5,018.0
11,144.6
1,046.7
3,527.6
4,198.2
5,087.6
U,729.5r
1,153.8
S^.O1
4,248.8rr
5,166.8
12,312.2r
1,124.7
3,556.6
4,197.8
5,132.2
12,391.9
1,131.9
3,581.1
4,215.3
5,151.6
12,448.1
1,153.3
3,606.9
4,238.5
5,171.4
12,493.4
1,133.2
3,575.7
4,204.2
n.a.
n.a.
249.5
7.4
289.9
297.0
269.9
7.4
303.1
336.3
295.0
7.8
355.1
388.9
324.9
7.6
402.6
418.6
327.3
7.7
380.6
409.1
330.7
7.8
380.7
412.9
334.4
7.8
390.3
420.8
337.3
7.9
378.9
409.1
2,522.3
769.5
2,553.7
721.6
2,480.9
670.5
2,436.3rr
658.8
2,432.0
641.1
2,449.1
634.2
2,453.5
631.7
2,442.5
628.4
Commercial banks
33 Savings deposits, including
MMDAs
34 Small time deposits910, 11
35 Large time deposits
580.8
610.5
367.7
664.0
601.9
341.3
752.9
507.8
291.7
783.9
467.6r
276.0
787.7
463.8
272.3
791.3
462.1
269.8
790.6
461.2
268.6
784.8
463.0
275.5
Thrift institutions
36 Savings deposits, including MMDAs
37 Small time deposits910
38 Large time deposits
337.6
562.4
120.6
374.8
463.8
83.1
428.1
361.2
67.2
429.4r
316.4
61.6
427.9
310.4
61.3
432.2
308.3
60.9
433.7
306.7
61.0
432.0
304.5
60.3
Money market mutual funds
39 General purpose and broker-dealer
40 Institution-only
353.8
134.7
368.5
180.4
350.2
200.4
347.2
195.8
349.4
186.1
357.4
180.5
367.2
176.2
364.5
171.0
Repurchase agreements and Eurodollars
41 Overnight
42 Term
77.3
158.3
80.6
130.1
80.7
126.7
91.9r
141.7r
92.8
137.5
97.8
139.0
94.1
142.8
93.7
140.1
2,491.3
8,176.3
2,765.0
8,379.7
3,069.8
8,659.7r
3,329.5
8,982.7r
3,345.4
9,046.5
3,374.4
9,073.7
3,376.7
9,116.7
Nontransaction components
31 In M2„
32 In M38
Debt components
43 Federal debt
44 Nonfederal debt
Footnotes appear on following page.
n.a.
n.a.
Monetary and Credit Aggregates
NOTES TO TABLE 1.21
1. Latest monthly and weekly figures are available from the Board's H.6 (508)
weekly statistical release. Historical data are available from the Money and
Reserves Projection Section, Division of Monetary Affairs, Board of Governors of
the Federal Reserve System, Washington, DC 20551.
2. Composition of the money stock measures and debt is as follows:
Ml: (1) currency outside the U.S. Treasury, Federal Reserve Banks, and the
vaults of depository institutions, (2) travelers checks of nonbank issuers, (3)
demand deposits at all commercial banks other than those owed to depository
institutions, the U.S. government, and foreign banks and official institutions, less
cash items in the process of collection and Federal Reserve float, and (4), other
checkable deposits (OCDs), consisting of negotiable order of withdrawal (NOW)
and automatic transfer service (ATS) accounts at depository institutions, credit
union share draft accounts, and demand deposits at thrift institutions. Seasonally
adjusted Ml is computed by summing currency, travelers checks, demand
deposits, and OCDs, each seasonally adjusted separately.
M2: Ml plus (1) overnight (and continuing-contract) repurchase agreements
(RPs) issued by all depository institutions and overnight Eurodollars issued to
U.S. residents by foreign branches of U.S. banks worldwide, (2) savings (including MMDAs) and small time deposits (time deposits—including retail RPs—in
amounts of less than $100,000), and (3) balances in both taxable and tax-exempt
general-purpose and broker-dealer money market funds. Excludes individual
retirement accounts (IRAs) and Keogh balances at depository institutions and
money market funds. Also excludes all balances held by U.S. commercial banks,
money market funds (general purpose and broker-dealer), foreign governments
and commercial banks, and the U.S. government. Seasonally adjusted M2 is
computed by adjusting its non-Mi component as a whole and then adding this
result to seasonally adjusted Ml.
M3: M2 plus (1) large time deposits and term RP liabilities (in amounts of
$100,000 or more) issued by all depository institutions, (2) term Eurodollars held
by U.S. residents at foreign branches of U.S. banks worldwide and at all banking
offices in the United Kingdom and Canada, and (3) balances in both taxable and
tax-exempt, institution-only money market funds. Excludes amounts held by
depository institutions, the U.S. government, money market funds, and foreign
banks and official institutions. Also excluded is the estimated amount of overnight
RPs and Eurodollars held by institution-only money market funds. Seasonally
adjusted M3 is computed by adjusting its non-M2 component as a whole and then
adding this result to seasonally adjusted M2.
L: M3 plus the nonbank public holdings of U.S. savings bonds, short-term
Treasury securities, commercial paper, and bankers acceptances, net of money
A15
market fund holdings of these assets. Seasonally adjusted L is computed by
summing U.S. savings bonds, short-term Treasury securities, commercial paper,
and bankers acceptances, each seasonally adjusted separately, and then adding
this result to M3.
Debt: Debt of domestic nonfinancial sectors consists of outstanding credit
market debt of the U.S. government, state and local governments, and private
nonfinancial sectors. Private debt consists of corporate bonds, mortgages, consumer credit (including bank loans), other bank loans, commercial paper, bankers
acceptances, and other debt instruments. Data are derived from the Federal
Reserve Board's flow of funds accounts. Debt data are based on monthly
averages. This sum is seasonally adjusted as a whole.
3. Currency outside the U.S. Treasury, Federal Reserve Banks, and vaults of
depository institutions.
4. Outstanding amount of U.S. dollar-denominated travelers checks of nonbank issuers. Travelers checks issued by depository institutions are included in
demand deposits.
5. Demand deposits at commercial banks and foreign-related institutions other
than those owed to depository institutions, the U.S. government, and foreign
banks and official institutions, less cash items in the process of collection and
Federal Reserve float.
6. Consists of NOW and ATS account balances at all depository institutions,
credit union share draft account balances, and demand deposits at thrift institutions.
7. Sum of (1) overnight RPs and overnight Eurodollars, (2) money market fund
balances (general purpose and broker-dealer), (3) savings deposits (including
MMDAs), and (4) small time deposits.
8. Sum of (1) large time deposits, (2) term RPs, (3) term Eurodollars of U.S.
residents, and (4) money market fiind balances (institution-only), less (5) a
consolidation adjustment that represents the estimated amount of overnight RPs
and Eurodollars held by institution-only money market funds.
9. Small time deposits—including retail RPs—are those issued in amounts of
less than $100,000. All IRAs and Keogh accounts at commercial banks and thrift
institutions are subtracted from small time deposits.
10. Large time deposits are those issued in amounts of $100,000 or more,
excluding those booked at international banking facilities.
11. Large time deposits at commercial banks less those held by money market
funds, depository institutions, U.S. government, and foreign banks and official
institutions.
A16
DomesticNonfinancialStatistics • August 1994
1.22 DEPOSIT INTEREST RATES AND AMOUNTS OUTSTANDING
Commercial and BIF-insured saving banks1
1993
1991
Dec.
Jitem
1994
1992
Dec.
Sept.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
May
Interest rates (annual effective yields)
INSURED COMMERCIAL BANKS
1 Negotiable order of withdrawal accounts . . .
2 Savings deposits
3.76
4.30
2.33
2.88
1.%
2.51
1.92
2.49
1.89
2.48
1.86
2.46
1.84
2.46
1.82
2.43
1.82r
2.43
1.81
2.45
1.82
2.50
Interest-bearing time deposits with balances
of less than $100,000, by maturity
7 to 91 days
92 to 182 days
183 days to 1 year
More than 1 year to 2Vi years
More than 2 Vl years
4.18
4.41
4.59
4.95
5.52
2.90
3.16
3.37
3.88
4.77
2.63
2.92
3.13
3.55
4.28
2.63
2.91
3.11
3.54
4.27
2.64
2.92
3.13
3.54
4.28
2.65
2.91
3.13
3.55
4.29
2.65
2.90
3.14
3.56
4.31
2.68
2.94
3.18
3.61
4.35
2.76
3.02
3.27
3.69
4.46
2.87
3.13
3.42
3.87
4.67
2.99
3.28
3.64
4.12
4.89
8 Negotiable order of withdrawal accounts . . .
9 Savings deposits
4.44
4.97
2.45
3.20
2.01
2.73
1.98
2.68
1.95
2.65
1.87
2.63
1.89
2.62
1.88
2.64
1.83
2.63
1.86
2.65
1.86
2.67
Interest-bearing time deposits with balances
of less than $100,000, by maturity
7 to 91 days
92 to 182 days
183 days to 1 year
More than 1 year to 2 Vl years
More than 2Vi years
4.68
4.92
4.99
5.23
5.98
3.13
3.44
3.61
4.02
5.00
2.76
3.05
3.33
3.69
4.62
2.75
3.05
3.34
3.68
4.57
2.73
3.03
3.32
3.69
4.60
2.70
3.02
3.31
3.66
4.62
2.69
3.03
3.33
3.72
4.61
2.69
3.04
3.34
3.76
4.66
2.71
3.08
3.37
3.85
4.75
2.72
3.13
3.47
3.%
4.85
2.77
3.21
3.67
4.12
5.08
3
4
5
6
7
BIF-INSURED SAVINGS BANKS3
10
11
12
13
14
Amounts outstanding (millions of dollars)
INSURED COMMERCIAL BANKS
286,541
738,253
578,757
159,496
286,056
758,835
592,028
166,807
289,813
765,372
595,715
169,657
297,329
770,609
598,200
172,408
305,223
766,413
597,838
168,575
293,806
771,559
606,615
164,944
295,573
776,204
611,725
164,479
297,496r
779,340rr
615,875r
163,465
293,888
771,869
611,720
160,149
292,813
773,173
612,622
160,551
47,094
158,605
209,672
171,721
158,078
38,474
127,831
163,098
152,977
169,708
30,384
108,574
152,501
139,406
184,414
30,022
108,504
149,758
139,042
183,790
29,730
109,228
147,334
139,315
180,972
29,455
110,069
146,565
141,223
181,528
29,312
109,110
144,037
141,204
182,193
29,578
109,444
143,624
141,006
181,240
29,539"
107,407rr
144,022r
139,946
180,973r
29,467
105,615
146,733
139,313
181,977
29,958
104,580
148,818
139,648
180,451
147,266
147,350
145,636
144,776
145,002
143,985
143,875
143,409
142,002r
142,448
142,049
25 Negotiable order of withdrawal accounts....
26 Savings deposits
2/
Personal
28 Nonpersonal
9,624
71,215
68,638
2,577
10,871
81,786
78,695
3,091
10,471
78,182
74,978
3,204
10,548
77,995
74,737
3,258
10,852
77,948
74,664
3,284
11,151
80,115
77,035
3,079
10,796
78,660
75,445
3,215
10,870
78,016
74,756
3,260
11,078
78,701rr
75,444
3,257
11,051
78,982
75,717
3,265
11,040
78,784
75,443
3,342
Interest-bearing time deposits with balances
of less than $100,000, by maturity
7 to 91 days
92 to 182 days
183 days to 1 year
More than 1 year to 2Vi years
More than 2 Vl years
4,146
21,686
29,715
25,379
18,665
3,867
17,345
21,780
18,442
18,845
2,886
13,261
17,798
16,161
19,610
2,839
13,131
17,441
16,124
19,657
2,778
12,926
17,178
15,995
19,645
2,793
12,946
17,426
16,546
20,464
2,737
13,094
17,418
16,281
20,630
2,735
13,165
17,436
16,338
20,939
2,671
13,177
17,511r
16,180
21,llO1
2,697
13,058
17,504
16,453
21,454
2,699
12,811
17,429
16,471
21,532
23,007
21,713
19,766
19,601
19,382
19,356
19,395
19,474
19,447
19,860
19,760
15 Negotiable order of withdrawal accounts . . . 244,637
16 Savings deposits2
652,058
1/ Personal
508,191
18 Nonpersonal
143,867
19
20
21
22
23
Interest-bearing time deposits with balances
of less than $100,000, by maturity
7 to 91 days
92 to 182 days
183 days to 1 year
More than 1 year to 2Vi years
More than 2Vi years
24 IRA/Keogh Plan deposits
BIF-INSURED SAVINGS BANKS
29
30
31
32
33
34 IRA/Keogh Plan accounts
3
1. BIF, Bank Insurance Fund. Data in this table also appear in the Board's H.6
(508) Special Supplementary Table monthly statistical release. For ordering
address, see inside front cover. Estimates are based on data collected by the
Federal Reserve System from a stratified random sample of about 460 commercial
banks and 80 savings banks on the last Wednesday of each period. Data are not
seasonally adjusted and include IRA/Keogh deposits and foriegn currency denominated deposits. Data exclude retail repurchase agreements and deposits held in
U.S. branches and agencies of foreign banks.
2. Includes personal and nonpersonal money market deposits.
3. BIF-insured savings banks include both mutual and federal savings banks.
Monetary and Credit Aggregates
A17
1.23 BANK DEBITS AND DEPOSIT TURNOVER 1
Debits are in billions of dollars; turnover is ratio of debits to deposits; monthly data are at annual rates
1993
Oct.
1994
Nov.
Dec.
Jan.r
Feb.
Mar.
Seasonally adjusted
DEBITS
3
Demand deposits
1 All insured banks
2 Major New York City banks
3 Other banks
4 Other checkable deposits4
5 Savings deposits (including MMDAs)
277,741.7
137,337.2
140,404.5
313,251.6
165,484.5
147,767.2
334,793.7
171,312.0
163,481.7
329,586.5
168,055.5
161,530.9
358,503.0
187,022.4
171,480.6
367,734.8
189,024.1
178,710.7
349,548.3
183,244.7
166,303.6
371,836.4
200,051.3
171,785.1
393,904.6
210,684.3
183,220.3
3,643.1
3,206.4
3,781.5
3,310.6
3,486.8
3,507.3
3,348.0
3,403.1
3,598.6
3,740.5
3,809.5
3,933.6
3,448.1
3,595.3
3,812.6
4,057.0
3,909.7
3,918.8
803.7
4,267.1
448.1
826.0
4,794.5
428.9
786.5
4,200.6
424.8
741.7
3,937.7
402.1
803.0
4,352.2
425.0
826.9
4,550.0
443.3
771.4
4,268.2
405.4
823.2
4,674.4
420.1
873.6
4,798.4
450.2
16.2
5.2
14.4
4.7
11.9
4.6
11.1
4.4
12.0
4.8
12.6
5.1
11.4
4.6
12.7
5.2
13.0
5.0
DEPOSIT TURNOVER
Demand deposits3
6 All insured banks
7 Major New York City banks
8 Other banks
9 Other checkable deposits4
10 Savings deposits (including MMDAs)
Not seasonally adjusted
DEBITS
Demand deposits3
11 All insured banks
12 Major New York City banks
13 Other banks
14 Other checkable deposits4
15 Savings deposits (including MMDAs)
277,752.4
137,307.2
140,445.2
313,416.8
165,595.0
147,821.9
334,775.6
171,283.5
163,492.1
336,009.2
172,675.6
163,333.6
344,140.1
180,990.2
163,149.9
380,187.5
194,541.0
185,646.4
349,643.9
181,971.7
167,672.1
345,559.7
187,904.4
157,655.3
406,855.0
218,783.5
188,071.5
3,645.2
3,209.2
3,784.4
3,310.0
3,485.2
3,505.8
3,323.3
3,336.0
3,370.1
3,511.8
3,888.9
4,066.4
3,768.6
3,780.9
3,505.6
3,616.9
3,916.7
3,883.0
803.6
4,269.0
448.1
826.3
4,803.5
429.0
786.5
4,197.9
424.9
750.0
4,059.2
402.8
754.8
4,129.6
395.9
820.6
4,387.8
443.1
759.5
4,047.8
403.6
783.1
4,319.0
396.3
923.4
5,140.2
472.5
16.2
5.2
14.4
4.7
11.9
4.6
11.2
4.3
11.2
4.5
12.7
5.2
12.2
4.8
11.7
4.6
13.0
5.0
DEPOSIT TURNOVER
Demand deposits3
16 All insured banks
17 Major New York City banks
18 Other banks
19 Other checkable deposits4
20 Savings deposits (including MMDAs)
1. Historical tables containing revised data for earlier periods can be obtained
from the Publications Section, Division of Support Services, Board of Governors
of the Federal Reserve System, Washington, DC 20551.
Data in this table also appear in the Board's G.6 (406) monthly statistical
release. For ordering address, see inside front cover.
2. Annual averages of monthly figures.
3. Represents accounts of individuals, partnerships, and corporations and of
states and political subdivisions.
4. As of January 1994, other checkable deposits (OCDs) previously defined as
automatic transfer to demand deposits (ATSs) and negotiable order of withdrawal
(NOW) accounts, were expanded to include telephone and preauthorized transfer
accounts. This change redefined OCDs for debits data to be consistent with OCDs
for deposits data.
5. Money market deposit accounts.
A18 Domestic Financial Statistics • August 1994
1.26
ASSETS A N D LIABILITIES OF COMMERCIAL B A N K S 1
Billions of dollars
Wednesday figures
Monthly averages
Account
1993r
1993
Mayr
Nov.
1994r
1994
Dec.
Jan.r
Feb/
ALL COMMERCIAL
BANKING INSTITUTIONS
Mar.r
Apr.
May
May 4
May 11
May 18
May 25
Seasonally adjusted
Assets
1 Bank credit
Securities in bank credit
3
U.S. government securities . . .
4
Other securities
5 Loans and leases in bank credit2.
6
Commercial and industrial
7
Real estate
8
Revolving home equity
9
Other
10
Consumer
11
Security3
12
Other
4
N Interbank loans
14 Cash assets56
15 Other assets
3,015.6
883.9
701.3
182.6
2,131.8
591.4
907.6
75.2
832.4
369.2
69.3
194.2
154.7
215.1
218.5
3,091.2
903.1
720.4
182.8
2,188.0
584.3
933.8
73.5
860.3
388.2
87.9
193.8
154.0
218.8
217.4
3,104.7
910.9
726.7
184.2
2,193.8
583.6
940.9
73.2
867.7
390.9
87.3
191.0
153.0
219.2
214.4
3,124.2
925.0
732.3
192.6
2,199.2
588.7
942.3
73.0
869.3
393.8
80.9
193.5
153.7
219.6
220.2
3,138.3
930.1
732.3
197.8
2,208.2
591.1
941.2
73.1
868.1
397.1
82.1
196.6
153.5
225.4
222.4
3,165.8
950.1
747.6
202.4
2,215.7
595.9
941.1
73.2
868.0
401.3
83.3
194.0
145.9
216.8
222.8
3,192.5
966.9
758.8
208.1
2,225.6
602.6
943.3
73.2
870.2
407.4
76.9
195.3
146.0
210.4
228.5
3,198.2
965.5
752.2
213.3
2,232.8
606.6
944.7
73.6
871.1
410.7
77.5
193.2
156.6
218.2
232.3
3,185.0
963.9
752.3
211.6
2,221.1
605.0
943.7
73.3
870.4
409.9
69.8
192.8
146.7
207.8
231.9
3,198.4
966.4
754.8
211.6
2,232.0
605.0
943.6
73.4
870.3
410.2
79.1
194.0
165.1
216.3
234.1
3,194.2
965.7
752.6
213.1
2,228.5
606.7
943.7
73.6
870.1
410.7
73.2
194.2
153.8
209.2
231.3
3,202.4
964.7
748.1
216.6
2,237.8
607.4
944.7
73.7
871.1
410.6
83.3
191.8
164.2
218.5
231.3
16 Total assets7
3,543.1
3,622.5
3,633.0
3,660.0
3,682.2
3,694.1
3,720.1
3,747.8
3,714.0
3,756.4
3,730.9
3,758.9
2,518.3
775.0
1,743.3
363.7
1,379.6
509.3
156.8
352.6
2,533.2
816.5
1,716.7
347.4
1,369.3
515.7
153.3
362.5
2,537.8
819.1
1,718.8
349.8
1,368.9
522.4
152.4
370.0
2,537.2
815.9
1,721.3
348.2
1,373.1
543.2
150.3
392.9
2,530.8
818.1
1,712.8
339.9
1,372.8
541.1
149.7
391.4
2,516.2
814.4
1,701.8
331.7
1,370.1
552.2
141.9
410.3
2,505.7
801.5
1,704.2
334.4
1,369.9
576.5
144.9
431.6
2,518.6
813.4
1,705.1
337.1
1,368.0
578.5
158.4
420.1
2,507.6
798.6
1,709.0
338.9
1,370.1
564.5
144.4
420.1
2,527.2
820.4
1,706.8
337.4
1,369.4
590.6
166.0
424.5
2,497.5
795.2
1,702.3
336.3
1,366.0
578.1
158.2
419.9
2,525.2
819.1
1,706.2
338.1
1,368.1
573.2
165.6
407.6
84.2
151.8
121.8
144.1
119.4
143.1
116.0
155.7
136.0
162.5
157.5
159.7
172.4
164.7
173.8
168.9
166.9
167.6
166.7
168.2
176.6
170.9
181.8
170.8
3,263.6
3,314.7
3,322.7
3,352.1
3,370.5
3,385.6
3,419.2
3,439.8
3,406.6
3,452.7
3,423.1
3,451.0
307.9
311.8
308.5
300.8
308.0
307.4
303.7
307.8
307.9
2
17
18
19
20
21
22
23
24
25
26
Liabilities
Deposits
Transaction
Nontransaction
Large time
Other
Borrowings
From banks in the U.S
From nonbanks in the U.S
Net due to related foreign
offices
Other liabilities8
27 Total liabilities
9
28 Residual (assets less liabilities) ....
279.5
307.8
310.3
Not seasonally adjusted
29
30
31
37
33
34
35
36
37
38
39
40
41
4?
43
Assets
Bank credit
Securities in bank credit
U.S. government securities . . .
Other securities
Loans and leases in bank credit2.
Commercial and industrial
Real estate
Revolving home equity
Other
Consumer
Security3
Other
4
Interbank loans
Cash assets56
Other assets
44 Total assets7
45
46
47
48
49
50
51
52
53
54
Liabilities
Deposits
Transaction
Nontransaction
Large time
Other
Borrowings
From banks in the U.S
From nonbanks in the U.S
Net due to related foreign
offices
Other liabilities8
55 Total liabilities
9
56 Residual (assets less liabilities)
Footnotes appear on last page.
3,006.4
881.2
699.2
182.0
2,125.2
592.9
907.5
74.9
832.6
368.0
65.8
190.8
149.8
212.2
215.8
3,102.0
908.5
724.4
184.1
2,193.4
585.2
936.3
74.0
862.3
388.4
87.8
195.8
155.6
226.3
220.2
3,120.3
910.4
726.3
184.2
2,209.9
585.5
944.1
73.5
870.6
395.3
89.3
195.7
161.3
232.5
218.5
3,125.2
920.9
728.3
192.6
2,204.3
587.9
940.8
73.1
867.6
398.2
83.2
194.2
157.9
224.6
222.6
3,136.9
930.0
731.0
199.0
2,206.9
590.3
937.8
72.9
864.8
398.4
86.7
193.6
154.3
219.9
221.9
3,164.6
953.4
751.3
202.1
2,211.2
598.8
937.4
72.5
864.9
398.5
85.5
191.0
145.8
211.5
221.3
3,190.9
967.9
760.9
207.0
2,223.0
605.6
941.4
72.7
868.7
404.2
79.6
192.3
147.5
207.7
224.9
3,187.2
961.3
749.2
212.1
2,225.9
608.1
945.1
73.3
871.8
409.4
73.6
189.7
151.7
215.7
229.4
3,187.8
964.5
753.5
211.0
2,223.3
609.5
943.3
73.1
870.3
408.0
72.1
190.4
148.6
210.6
231.6
3,185.7
962.9
751.7
211.3
2,222.8
607.1
945.5
73.1
872.4
408.7
72.3
189.1
155.5
204.2
232.2
3,185.1
961.6
750.1
211.5
2,223.4
607.7
944.0
73.3
870.7
409.8
72.1
189.8
150.2
203.2
226.5
3,177.8
956.3
742.8
213.5
2,221.5
607.4
944.1
73.4
870.7
409.5
74.4
186.1
152.6
204.5
224.9
3,523.3
3,644.9
3,673.8
3,672.8
3,675.3
3,685.5
3,713.8
3,726.4
3,721.1
3,720.0
3,707.2
3,702.2
2,508.1
764.2
1,743.9
368.1
1,375.8
497.5
149.8
347.6
2,544.0
828.1
1,715.9
344.3
1,371.6
526.6
154.2
372.4
2,566.6
853.6
1,713.1
346.0
1,367.0
532.4
159.6
372.8
2,540.5
825.5
1,715.0
344.6
1,370.3
545.1
155.9
389.2
2,520.5
808.9
1,711.6
340.3
1,371.3
545.5
152.1
393.4
2,507.9
802.8
1,705.0
334.3
1,370.8
546.2
143.3
403.0
2,512.4
809.8
1,702.6
335.5
1,367.1
561.2
146.3
414.8
2,507.3
802.0
1,705.3
341.1
1,364.1
567.5
151.7
415.7
2,515.6
809.1
1,706.4
341.5
1,365.0
565.5
148.6
416.9
2,503.3
796.3
1,707.0
340.9
1,366.1
575.0
155.5
419.5
2,484.2
781.9
1,702.3
340.6
1,361.7
566.6
150.2
416.4
2,484.2
779.1
1,705.0
343.0
1,362.0
556.8
152.6
404.1
87.2
148.0
124.6
150.0
126.5
146.6
124.2
158.0
139.0
162.6
162.2
159.5
171.3
159.1
179.4
164.4
170.0
162.9
170.5
164.8
185.0
164.8
188.0
165.8
3,240.7
3,345.2
3,372.1
3,367.7
3,367.6
3,375.7
3,404.0
3,418.6
3,413.9
3,413.6
3,400.6
3,394.7
305.0
307.7
309.8
309.8
307.8
307.2
306.4
306.7
307.5
282.6
299.7
301.7
Commercial Banking Institutions
A19
1.26 ASSETS AND LIABILITIES OF COMMERCIAL BANKS1—Continued
Billions of dollars
Wednesday figures
Monthly averages
May1
Nov.
Dec.
Jan.1
Feb.r
DOMESTICALLY CHARTERED
COMMERCIAL BANKS
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
Assets
Bank credit
Securities in bank credit
U.S. government securities .
Other securities
Loans and leases in bank credit2
Commercial and industrial ..
Real estate
Revolving home equity . . .
Other
Consumer
Security3
Other
4
Interbank loans
Cash assets56
Other assets
72 Total assets7
Liabilities
73 Deposits
74 Transaction
75 Nontransaction
76
Large time
77
Other
78 Borrowings
79 From banks in the U.S
80 From nonbanks in the U.S.
81 Net due to related foreign
offices
82 Other liabilities8
83 Total liabilities
84 Residual (assets less liabilities)9.
1994r
1994
1993*
Mar.r
Apr.
May
May 4r
May ll r
May 18r
May 25r
Seasonally adjusted
2,682.9
810.6
652.9
157.7
1,872.3
438.1
857.8
75.2
782.6
369.2
48.2
158.9
134.1
188.2
172.2
2,756.2
826.2
668.2
158.0
1,930.0
434.1
886.8
73.5
813.3
388.2
60.0
160.9
132.9
193.2
172.5
2,771.9
833.6
673.3
160.3
1,938.3
435.5
894.7
73.2
821.5
390.9
57.9
159.4
133.6
193.8
171.7
2,792.9
846.5
678.4
168.1
1,946.4
440.3
897.5
73.0
824.5
393.8
54.4
160.5
135.3
194.5
175.4
2,801.0
850.1
676.8
173.3
1,950.9
442.5
896.7
73.1
823.6
397.1
54.5
160.1
130.4
200.9
175.9
2,826.1
869.3
691.1
178.1
1,956.8
444.3
897.3
73.1
824.1
401.3
55.5
158.3
125.9
191.4
177.0
2,840.8
876.8
695.4
181.4
1,964.0
448.2
900.8
73.2
827.7
407.4
49.5
158.0
124.4
184.3
182.6
2,847.8
874.2
691.7
182.4
1,973.6
451.1
902.6
73.5
829.0
410.7
51.5
157.7
133.0
191.0
182.9
2,838.3
874.5
691.9
182.5
1,963.8
450.4
901.6
73.3
828.3
409.9
45.8
156.2
124.0
182.1
183.5
2,845.9
874.8
693.1
181.7
1,971.1
450.0
901.6
73.4
828.3
410.2
51.5
157.9
140.2
189.1
183.8
2,846.3
874.4
692.2
182.2
1,971.9
450.8
901.5
73.6
828.0
410.7
50.7
158.1
131.2
181.2
182.4
2,852.3
873.9
689.4
184.5
1,978.4
451.5
902.7
73.7
829.1
410.6
56.6
157.0
138.1
190.8
182.8
3,116.6
3,196.1
3,212.7
3,240.6
3,251.1
3,263.2
3,274.7
3,297.2
3,270.6
3,301.6
3,283.6
3,306.4
2,362.2
764.2
1,598.0
222.5
1,375.5
387.1
115.9
271.1
2,378.9
804.9
1,574.0
210.8
1,363.2
410.3
121.5
288.9
2,379.4
808.2
1,571.2
208.9
1,362.3
417.2
121.9
295.3
2,381.6
805.0
1,576.6
210.3
1,366.3
437.2
120.3
317.0
2,381.5
806.7
1,574.9
208.6
1,366.3
440.3
121.7
318.5
2,375.3
802.9
1,572.4
207.2
1,365.2
455.6
117.3
338.2
2,362.2
790.7
1,571.5
207.5
1,364.0
475.1
116.9
358.1
2,374.6
802.6
1,572.0
208.9
1,363.1
474.5
126.9
347.6
2,361.9
788.2
1,573.8
209.3
1,364.4
467.5
115.2
352.3
2,383.0
809.6
1,573.4
209.0
1,364.4
483.5
129.7
353.8
2,355.1
784.5
1,570.6
208.6
1,362.0
475.6
129.3
346.3
2,379.7
808.2
1,571.5
209.1
1,362.4
470.3
135.1
335.2
-13.8
109.0
-2.7
104.9
1.7
104.7
3.4
113.2
3.2
119.1
14.0
117.8
21.1
122.9
25.2
125.8
18.7
124.6
16.1
125.0
31.3
127.9
31.4
127.5
2,844.4
2,891.4
2,903.0
2,935.5
2,944.1
2,962.7
2,981.2
3,000.1
2,972.8
3,007.7
2,989.9
3,009.0
272.1
304.7
309.8
305.1
307.0
300.5
293.5
297.1
297.9
293.8
293.7
297.5
Not seasonally adjusted
85
86
87
88
89
90
91
92
93
94
95
96
97
98
99
Assets
Bank credit
Securities in bank credit
U.S. government securities .
Other securities
Loans and leases in bank credit2
Commercial and industrial..
Real estate
Revolving home equity . . .
Other
Consumer
Security3
Other
Interbank loans4
Cash assets56
Other assets
100 Total assets7
Liabilities
101 Deposits
102 Transaction
103 Nontransaction
104
Large time
105
Other
106 Borrowings
107 From banks in the U.S
108 From nonbanks in the U.S. . . .
109 Net due to related foreign
offices
110 Other liabilities8
111 Total liabilities
112 Residual (assets less liabilities)9.,
Footnotes appear on following page.
2,678.8
809.1
652.1
157.0
1,869.8
440.7
857.8
74.9
782.9
368.0
46.3
156.9
129.6
186.3
170.5
2,764.9
830.3
670.9
159.4
1,934.6
434.9
889.1
74.0
815.2
388.4
59.8
162.5
134.6
200.6
173.8
2,778.7
830.9
670.6
160.3
1,947.7
435.5
898.0
73.5
824.6
395.3
57.2
161.8
138.9
206.8
173.8
2,786.0
840.1
672.3
167.8
1,945.9
437.8
896.1
73.1
823.0
398.2
53.9
159.8
138.4
199.7
176.6
2,797.2
849.3
675.6
173.7
1,947.9
44.1.7
893.1
72.9
820.2
398.4
56.6
158.0
132.6
196.0
175.1
2,821.0
870.0
692.7
177.2
1,951.0
446.3
893.4
72.5
820.9
398.5
56.7
156.1
126.5
186.6
176.1
2,841.5
879.1
699.0
180.0
1,962.4
450.9
899.0
72.7
826.3
404.2
52.1
156.3
126.4
182.5
179.9
2,842.9
871.7
690.5
181.2
1,971.2
453.8
903.0
73.3
829.7
409.4
49.4
155.7
128.8
189.5
181.1
2,843.3
875.0
693.2
181.8
1,968.3
455.2
901.1
73.0
828.1
408.0
48.4
155.6
126.1
185.2
183.7
2,840.6
872.7
691.9
180.8
1,967.9
453.2
903.4
73.1
830.3
408.7
48.0
154.6
131.5
178.4
182.5
2,843.0
872.4
691.8
180.6
1,970.6
453.3
901.9
73.3
828.6
409.8
50.2
155.4
127.7
176.6
178.8
2,836.3
867.7
685.9
181.8
1,968.6
453.0
902.2
73.4
828.8
409.5
50.5
153.4
127.4
178.2
177.8
3,104.4
3,214.9
3,239.4
3,243.3
3,243.3
3,252.6
3,273.1
3,284.7
3,280.9
3,275.4
3,268.4
3,262.1
2,348.2
753.8
1,594.4
223.0
1,371.4
380.3
112.4
267.9
2,394.0
816.5
1,577.5
211.3
1,366.2
420.1
121.3
298.8
2,411.4
842.5
1,569.0
207.5
1,361.4
425.8
126.7
299.1
2,386.6
814.3
1,572.2
208.8
1,363.4
439.1
124.9
314.1
2,370.4
797.5
1,572.8
208.7
1,364.2
446.2
124.9
321.2
2,363.8
791.8
1,572.1
206.6
1,365.4
450.3
118.6
331.7
2,367.6
799.2
1,568.4
206.8
1,361.6
461.3
119.3
342.0
2,360.1
791.6
1,568.5
209.5
1,359.0
467.8
123.0
344.8
2,367.4
799.0
1,568.4
209.2
1,359.2
469.8
120.8
349.0
2,356.6
785.9
1,570.7
209.6
1,361.1
472.8
123.1
349.8
2,338.8
771.9
1,567.0
209.1
1,357.8
469.1
124.2
344.9
2,334.8
768.5
1,566.2
210.2
1,356.1
459.2
125.4
333.8
-9.4
105.7
-3.3
109.6
-1.8
107.4
3.0
114.5
5.4
118.6
16.0
117.9
20.6
118.3
31.1
121.8
20.1
565.5
22.0
575.0
35.2
566.6
41.1
556.8
2,824.8
2,920.5
2,942.8
2,943.1
2,940.6
2,948.0
2,967.9
2,980.8
2,977.6
2,972.9
2,965.7
2,958.5
279.6
294.4
296.6
300.1
302.8
304.6
305.2
303.9
303.3
302.5
302.7
303.6
A20
DomesticNonfinancialStatistics • August 1994
NOTES TO TABLE 1.26
1. Covers the following types of institutions in the fifty states and the District
of Columbia: domestically chartered commercial banks that submit a weekly
report of condition (large domestic); other domestically chartered commercial
banks (small domestic); branches and agencies of foreign banks; New York State
investment companies, and Edge Act and agreement corporations (foreign-related
institutions). Excludes international banking facilities. Data are Wednesday
values, or pro rata averages of Wednesday values. Large domestic banks
constitute a universe; data for small domestic banks and foreign-related institutions are estimates based on weekly samples and on quarter-end condition
reports. Data are adjusted for breaks caused by reclassifications of assets and
liabilities.
2. Excludes federal funds sold to, reverse repurchase agreements with, and
loans to commercial banks in the United States.
3. Consists of reserve repurchase agreements with broker-dealers and loans to
purchase and carry securities.
4. Consists of federal funds sold to, reverse repurchase agreements with, and
loans to commercial banks in the United States.
5. Includes vault cash, cash items in process of collection, demand balances
due from depository institutions in the United States, balances due from Federal
Reserve Banks, and other cash assets.
6. Excludes the due-from position with related foreign offices, which is
included in lines 25, 53, 81, and 109.
7. Excludes unearned income, reserves for losses on loans and leases, and
reserves for transfer risk. Loans are reported gross of these items.
8. Excludes the due-to position with related foreign offices, which is included in
lines 25, 53, 81, and 109.
9. This balancing item is not intended as a measure of equity capital for use in
capital adequacy analysis.
Weekly Reporting Commercial Banks
1.27 ASSETS AND LIABILITIES OF LARGE WEEKLY REPORTING COMMERCIAL BANKS
Millions of dollars, Wednesday figures
1994
Account
Mar. 30"
Apr. 6
Apr. 13
Apr. 20
Apr. 27
May 4
May 11
May 18
ASSETS
1 Cash and balances due from depository institutions
2 U.S. Treasury and government securities
3 Trading account
4 Investment account
5
Mortgage-backed securities1
All others, by maturity
6
One year or less
7
One year through five years
8
More than five years
9 Other securities
10 Trading account
11 Investment account
12
State and political subdivisions, by maturity ..
13
One year or less
14
More than one year
15
Other bonds, corporate stocks, and securities
16 Other trading account assets
17 Federal funds sold2
18 To commercial banks in the United States
19 To nonbank brokers and dealers
20 To others'
21 Other loans and leases, gross
22 Commercial and industrial
23
Bankers acceptances and commercial paper ...
24
All other
25
U.S. addressees
26
Non-U.S. addressees
27 Real estate loans
28
Revolving, home equity
29
All other
30 To individuals for personal expenditures
31 To financial institutions
32
Commercial banks in the United States
33
Banks in foreign countries
34
Nonbank financial institutions
35 For purchasing and carrying securities
36 To finance agricultural production
37 To states and political subdivisions
38 To foreign governments
and official institutions
39 All other loans4
40 Lease-financing receivables
41 LESS: Unearned income
42
Loan and lease reserve
43 Other loans and leases, net
44 Other assets
45 Total assets
Footnotes appear on the following page.
112,145
318,573
24,755
293,818
92,206
113,279
325,919
29,031
296,888
93,637
108,545
322,816
27,778
295,038
92,800
111,076
319,297
27,129
292,167
91,068
101,279
312,989
24,357
288,632
88,058
108,992
314,%2
26,163
288,800
87,685
103.871
312.872
25,766
287,106
86,980
104,071
312,382
26,647
285,735
86,2%
51,012
79,615
70,985
87,892
1,940
57,847
21,748
4,231
17,517
36,099
28,105
49,029
82,387
71,835
90,930
1,970
58,029
21,701
4,175
17,526
36,328
30,9311
48,359
82,177
71,701
90,706
1,638
58,340
21,7%
4,410
17,385
36,544
30,728
49,489
79,998
71,612
90,784
1,773
58,094
21,819
4,391
17,428
36,275
30,917
50,438
79,211
70,925
90,467
1,784
57,790
21,842
4,412
17,430
35,948
30,893
49,351
79,946
71,817
92,486
1,776
57,935
21,734
4,467
17,267
36,201
32,775
48,347
79,769
72,011
91,418
49,534
78,350
71,556
91,274
1,868
57,723
21,692
4,437
17,256
36,031
31,683
92,762
61,388
25,950
5,423
1,041,746
287,801
2,663
285,138
283,122
2,016
419,208
43,482
375,726
209,579
35,517
14,898
2,519
18,099
19,836
5,945
11,975
1,064
24,070
26,751
1,605
34,971
1,005,170
162,144
91,996
56,739
29,412
5,845
1,043,921
288,806
2,688
%,2%
59,5%
31,140
5,560
1,043,222
286,890
2,858
284,032
284,1911
1,927
422,239
43,433
378,806
209,440
37,167
15,107
3,011
19,049
16,491
6,017
11,908
1,034
24,065
26,756
1,590
34,826
1,007,505
165,590
100,447
65,794
29,398
5,256
1,047,488
290,281
2,882
287,399
285,604
1,795
421,099
43,850
377,249
212,447
35,948
16,078
2,233
17,638
92,311
59,730
26,757
5,824
1,052,695
293,744
2,964
290,780
288,894
17,565
6,019
11,917
986
22,481
26,792
1,588
34,797
1,006,836
164,918
91,330
59,165
26,209
5,956
1,048,448
290,830
2,972
287,858
285,920
1,938
421,970
43,759
378,211
211,357
35,871
15,424
2,443
18,004
17,216
6,106
11,921
1,075
25,201
26,901
1,594
34,704
1,012,151
164,217
1,011
23,525
26,910
1,586
34,585
1,011,317
162,953
424,105
43,856
380,249
213,188
36,736
16,832
2,314
17,591
15,639
6,141
11,915
1,015
22,%7
27,245
1,623
34,921
1,016,150
168,171
97,088
65,662
25,995
5,432
1,052,412
291,966
3,101
288,865
287,038
1,827
425,991
43,941
382,051
213,513
36,100
16,241
2,215
17,643
16,100
6,175
11,795
992
22,499
27,281
1,631
35,063
1,015,718
168,066
%,788
62,999
28,147
5,642
1,052,645
291,959
3,197
288,762
286,939
1,823
423,891
44,119
379,772
214,323
36,228
17,117
2,571
16,540
16,178
6,231
11,857
1,112
23,511
27,356
1,657
35,054
1,015,934
159,9%
1,778,685
1,795,217
1,790,116
1,788,854
1,779,452
1,793,073 1,789,033
1,780,444
286,118
282,120
1,912
424,571
43,546
381,025
210,225
35,775
14,930
2,580
18,266
18,286
6,097
11,882
1,886
1,806
57,857
21,720
4,448
17,272
36,137
31,754
A21
A22
DomesticNonfinancialStatistics • August 1994
1.27 ASSETS AND LIABILITIES OF LARGE WEEKLY REPORTING COMMERCIAL BANKS—Continued
Millions of dollars, Wednesday figures
1994
Account
Mar. iff
Apr. 6
Apr. 13
Apr. 20
Apr. 27
May 4
May 11
May 18
May 25
1,149,060
300,862
250,303
50,559
8,468
2,169
22,213
6,566
644
10,499
129,064
719,134
698,705
20,428
17,915
622
1,514
377
1,147,134
300,322
252,578
47,744
8,763
2,255
21,010
5,030
729
9,957
128,424
718,388
698,005
20,384
17,788
610
1,611
376
1,131,055
292,226
243,522
48,705
10,032
3,420
20,288
5,195
588
9,182
127,229
711,600
689,102
22,498
17,676
2,832
1,614
376
1,119,976
286,899
236,503
50,3%
10,148
3,061
20,235
5,304
1,028
10,619
122,056
711,020
688,336
22,685
17,755
2,800
1,757
374
1,134,591
292,867
243,931
48,936
10,286
2,093
21,854
5,500
585
8,618
125,789
715,935
693,148
22,787
17,852
2,678
1,882
376
1,128,951
288,046
241,927
46,119
8,631
1,939
20,354
5,282
631
9,282
123,406
717,498
694,356
23,142
18,113
2,706
1,940
383
1,118,594
281,479
235,189
46,290
8,633
1,893
20,364
5,125
795
9,480
122,636
714,478
691,123
23,355
18,343
2,684
1,943
385
1,116,016
281,242
234,993
46,249
8,867
1,738
21,249
4,890
545
8,959
121,488
713,286
689,885
23,401
18,371
2,692
1,961
377
340,208
0
6,466
333,742
337,390
150
9,166
328,074
351,964
0
31,776
320,188
351,752
0
33,420
318,332
350,074
0
32,497
317,577
349,626
0
30,528
319,098
343,566
0
13,676
329,889
334,397
0
8,823
325,575
LIABILITIES
1,129,345
46 Deposits
293,242
47 Demand deposits
48
Individuals, partnerships, and corporations
243,530
49
Other holders
49,711
8,734
50
States and political subdivisions
51
U.S. government
2,073
52
Depository institutions in the United States
20,789
Banks in foreign countries
5,444
53
54
Foreign governments and official institutions
583
55
Certified and officers' checks
12,088
56 Transaction balances other than demand deposits
123,769
57 Nontransaction balances
712,334
690,914
58
Individuals, partnerships, and corporations
Other holders
21,420
59
17,818
60
States and political subdivisions
61
1,519
U.S. government
Depository institutions in the United States
1,707
62
Foreign governments, official institutions, and banks . . . .
377
63
64 Liabilities for borrowed money5
65 Borrowings from Federal Reserve Banks
66 Treasury tax and loan notes
,
67 Other liabilities for borrowed money6
68 Other liabilities (including subordinated notes and
debentures)
345,925
0
14,291
331,634
139,478
141,049
140,534
141,006
142,801
144,649
147,004
154,772
158,418
1,614,748
1,630,317
1,625,059
1,624,025
1,614,529
1,629,314
1,625,581
1,616,932
1,608,832
163,937
164,901
165,058
164,829
164,924
163,759
163,452
163,513
163,379
Total loans and leases, gross, adjusted, plus securities .. 1,464,686
91,561
Time deposits in amounts of $100,000 or more
Loans sold outright to affiliates
697
Commercial and industrial
334
Other
363
21,882
Foreign branch credit extended to U.S. residents1"
Net owed to related institutions abroad
16,171
1,480,919
92,382
694
329
365
21,774
10,625
1,478,514
93,488
694
329
365
21,958
13,663
1,475,269
95,373
693
329
364
22,026
17,644
1,469,519
95,477
695
329
366
22,107
19,806
1,475,893
96,505
700
329
371
22,141
15,503
1,471,888
96,682
700
328
371
22,283
16,963
1,472,973
96,112
699
328
371
22,598
30,309
1,467,404
96,732
698
328
370
22,399
35,913
69 Total liabilities
70 Residual (total assets less total liabilities)7
MEMO
71
72
73
74
75
76
77
1. Includes certificates of participation, issued or guaranteed by agencies of the
U.S. government, in pools of residential mortgages.
2. Includes securities purchased under agreements to resell.
3. Includes allocated transfer risk reserve.
4. Includes negotiable order of withdrawal accounts (NOWs), automatic transfer service (ATS), and telephone and preauthorized transfers of savings deposits.
5. Includes borrowings only from other than directly related institutions.
6. Includes federal funds purchased and securities sold under agreements to
repurchase.
7. This balancing item is not intended as a measure of equity capital for use in
capital-adequacy analysis.
8. Excludes loans to and federal funds transactions with commercial banks in
the United States.
9. Affiliates include a bank's own foreign branches, nonconsolidated nonbank
affiliates of the bank, the bank's holding company (if not a bank), and nonconsolidated nonbank subsidiaries of the holding company.
10. Credit extended by foreign branches of domestically chartered weekly
reporting banks to nonbank U.S. residents. Consists mainly of commercial and
industrial loans, but includes an unknown amount of credit extended to other than
nonfinancial businesses.
NOTE. Data that formerly appeared in table 1.28, Assets and Liabilities of Large
Weekly Reporting Commercial Banks in New York City, can be obtained from the
Board's H.4.2 (504) weekly statistical release. For ordering address, see inside
front cover.
Weekly Reporting Commercial Banks
1.28 LARGE WEEKLY REPORTING U.S. BRANCHES AND AGENCIES OF FOREIGN BANKS
Liabilities1
A23
Assets and
Millions of dollars, Wednesday figures
Account
Mar. 30
Apr. 6
Apr. 13
Apr. 20
Apr. 27
May 4
May 11
May 18
May 25
ASSETS
1 Cash and balances due from depository
institutions
2 U.S. Treasury and government agency
securities
3 Other securities. 1
4 Federal funds sold
5 To commercial banks in the United States ..
6 To others2
7 Other loans and leases, gross
8 Commercial and industrial
9
Bankers acceptances and commercial
paper
10
All other
11
U.S. addressees
12
Non-U.S. addressees
13 Loans secured by real estate
14 To financial institutions
15
Commercial banks in the United States.
16
Banks in foreign countries
17
Nonbank financial institutions
18 For purchasing and carrying securities . . .
19 To foreign governments and official
institutions
20 All other
21 Other assets (claims on nonrelated parties) .
22 Total assets3
16,412
15,670
16,016
16,309
16,790
16,347
16,652
17,210
17,097
38,776
8,670
27,290
7,438
19,852
160,813r
98,598
41,128
8,592
25,055
5,344
19,711
159,422
98,787
41,176
8,887
26,813
6,509
20,304
157,353
97,685
40,089
9,478
24,234
4,374
19,860
159,567
99,492
39,920
9,956
28,989
8,204
20,785
159,526
99,177
39,482
10,136
24,474
7,028
17,446
157,997
98,753
39,227
10,584
25,961
8,062
17,900
157,427
98,793
38,317
10,725
22,910
7,152
15,758
158,221
99,158
37,429
11,057
26,134
8,879
17,255
157,348
99,542
3,380
95,218rr
91,482r
3,736
28,428r
23,366
5,449
2,349
15,568r
6,121
3,812
94,975
91,213
3,762
28,180
24,021
5,635
2,237
16,149
4,233
3,582
94,103
90,477
3,627
27,694
23,724
5,477
2,069
16,178
3,819
3,820
95,671
92,026
3,645
27,751
23,456
5,392
2,026
16,038
4,577
3,794
95,383
91,672
3,710
27,781
23,706
5,448
1,965
16,294
4,446
3,662
95,092
91,399
3,693
27,777
23,443
5,488
1,867
16,088
3,761
3,662
95,131
91,443
3,688
27,750
22,971
5,322
1,795
15,854
3,755
3.444
95,714
91,8%
3,818
27,747
23,518
5.445
2,065
16,008
3,636
3,476
96,066
92,165
3,901
27,718
22,327
5,280
1,847
15,200
3,706
545
3,754r
31,709r
666
3,535
31,706
815
3,616
31,585
656
3,636
32,174
629
3,787
30,392
570
3,692
33,643
642
3,515
35,176
557
3,606
33,620
528
3,526
33,307
301,888r
300,912
300,511
303,034
302,627
302,571
305,815
302,697
303,449
90,288
5,194
87,282
4,688
87,936
4,210
91,200
4,275
90,056
4,611
92,586
4,194
91,598
4,325
92,217
4,220
93,318
4,433
3,891
1,303
85,094
3,728
961
82,594
3,498
713
83,725
3,550
725
86,925
3,497
1,115
85,445
3,432
762
88,391
3,405
920
87,273
3,476
745
87,997
3,510
923
88,885
58,123
26,971
55,941
26,653
56,861
26,865
58,999
27,926
58,004
27,441
59,778
28,613
58,653
28,619
58,639
29,358
58,783
30,102
64,972r
31,944
70,269
37,749
72,298
37,648
72,192
37,172
68,760
35,753
66,352
32,658
70,452
34,485
68,569
29,976
67,610
30,762
7,015
24,929
64,972r
9,435
28,314
70,269
8,093
29,555
72,298
8,161
29,011
72,192
8,068
27,685
68,760
6,977
25,681
66,352
9,392
25,093
70,452
5,980
23,9%
68,569
6,866
23,8%
67,610
5,348r
27,681r
29,401
5,429
27,091
27,685
5,294
29,356
28,772
5,718
29,302
28,600
6,225
26,782
28,466
6,378
27,317
30,459
6,776
29,191
31,013
6,438
32,156
30,748
6,243
30,604
30,359
301,888r
300,912
300,511
303,034
302,627
302,571
305,815
302,697
303,449
222,662r
99,008
223,219
96,337
222,243
92,824
223,602
89,859
224,739
98,290
219,574
92,683
219,816
91,965
217,576
89,470
217,810
91,087
LIABILITIES
23 Deposits or credit balances owed to other
than directly-related institutions
24 Demand deposits
25 Individuals, partnerships, and
corporations
26 Other
27 Nontransaction accounts
28 Individuals, partnerships, and
corporations
29 Other
30 Borrowings from other than directlyrelated institutions .,
31 Federal funds purchased
32 From commercial banks in the
United States
33 From others
34 Other liabilities for borrowed money
35 To commercial banks in the
United States
36 To others
37 Other liabilities to nonrelated parties
38 Total liabilities6
MEMO
.
39 Total loans (gross) and securities, adjusted'.
40 Net owed to related institutions abroad
1. Includes securities purchased under agreements to resell.
2. Includes transactions with nonbank brokers and dealers in securities.
3. Includes net due from related institutions abroad for U.S. branches and
agencies of foreign banks having a net "due from" position.
4. Includes other transaction deposits.
5. Includes securities sold under agreements to repurchase.
6. Includes net owed to related institutions abroad for U.S. branches and
agencies of foreign banks having a net "due to" position.
7. Excludes loans to and federal funds transactions with commercial banks in
the United States.
A24
DomesticNonfinancialStatistics • August 1994
1.32 COMMERCIAL PAPER AND BANKERS DOLLAR ACCEPTANCES OUTSTANDING
Millions of dollars, end of period
Year ending December
1994
1993
Item
1989
1990
1992
1991
1993
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
Commercial paper (seasonally adjusted unless noted otherwise)
1 All issuers
2
3
4
5
Financial companies'
Dealer-placed paper
Total
Bank-related (not
seasonally
adjusted)3
Directly placed paper
Total
Bank-related (not seasonally
adjusted)
6 Nonfinancial companies5
525,831
562,656
528,832
545,619
555,075
547,982
555,075
559,443r
560,352
557,129
553,355
183,622
214,706
212,999
226,456
218,947
216,887
218,947
219,3501
221,649
214,722
205,267
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
210,930
200,036
182,463
171,605
180,389
175,868
180,389
182,075
186,318
194,527
199,803
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
131,279
147,914
133,370
147,558
155,739
155,227
155,739
158,018r
152,385
147,880
148,285
Bankers dollar acceptances (not seasonally adjusted)6
7 Total
By holder
8 Accepting banks
9 Own bills
10 Bills bought from other banks
Federal Reserve Banks
11 Foreign correspondents
12 Others
By basis
13 Imports into United States
14 Exports from United States
15 All other
62,972
54,771
43,770
38,194
32,348
31,997
32,348
31,792
30,994
31,061
31,775
9,433
8,510
924
9,017
7,930
1,087
11,017
9,347
1,670
10,555
9,097
1,458
12,421r
10,707r
1,714
12,475
10,853
1,622
12,421rr
10,707
1,714
11,410"r
9,953
1,457
ll,258r
10,248r
1,010
11,727
10,758
969
11,643
10,888
755
1,066
52,473
918
44,836
1,739
31,014
1,276
26,364
725
19,202r
650
18,872
725
19,202r
869
19,513r
753
18,983r
693
18,641
625
19,507
15,651
13,683
33,638
13,095
12,703
28,973
12,843
10,351
20,577
12,209
8,096
17,890
10,217
7,293
14,838
10,368
7,054
14,575
10,217
7,293
14,838
10,649
7,123
14,020
10,707
6,872
13,414
10,554
6,708
13,800
10,834
6,723
14,217
1. Institutions engaged primarily in commercial, savings, and mortgage banking; sales, personal, and mortgage financing; factoring, finance leasing, and other
business lending; insurance underwriting; and other investment activities.
2. Includes all financial-company paper sold by dealers in the open market.
3. Series were discontinued in January 1989.
4. As reported by financial companies that place their paper directly with
investors.
5. Includes public utilities and firms engaged primarily in such activities as
communications, construction, manufacturing, mining, wholesale and retail trade,
transportation, and services.
6. Data on bankers dollar acceptances are gathered from approximately 100
institutions. The reporting group is revised every January.
7. In 1977 the Federal Reserve discontinued operations in bankers dollar
acceptances for its own account.
Financial Markets
1.33 PRIME RATE CHARGED BY BANKS
Percent per year
Date of change
1991— Jan.
1
Period
4
1
13
6
23
10.00
9.50
9.00
8.50
8.00
7.50
6.50
2
6.00
1994— Mar. 24
Apr. 19
May 17
6.25
6.75
7.25
Feb.
May
Sept.
Nov.
Dec.
1992— July
2
1991
1992
1993
Short-Term Business Loans1
Average
rate
8.46
6.25
6.00
1991Feb.
Mar.
Apr.
May .
June
July .
Aug.
Sept.
Oct. .
Nov.
Dec.
9.52
9.05
9.00
9.00
8.50
8.50
8.50
8.50
8.20
8.00
7.58
7.21
1. The prime rate is one of several base rates that banks use to price short-term
business loans. The table shows the date on which a new rate came to be the
predominant one quoted by a majority of the twenty-five largest banks by asset
A25
Period
1992— Jan.
Feb.
Mar.
Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
Average
rate
6.50
6.50
6.50
6.50
6.50
6.50
6.02
6.00
6.00
6.00
6.00
6.00
Period
Average
rate
1993—Jan. ...
Feb. ..
Mar. ..
Apr. ..
May ...
June ..
July ...
Aug. ..
Sept. ..
Oct. ...
Nov. ..
Dec. ,
6.00
6.00
6.00
6.00
6.00
6.00
6.00
6.00
6.00
6.00
6.00
6.00
1994—Jan.
Feb.
Mar.
Apr.
May ,
June
6.00
6.00
6.06
6.45
6.99
7.25
size, based on the most recent Call Report. Data in this table also appear in the
Board's H.15 (519) weekly and G.13 (415) monthly statistical releases. For
ordering address, see inside front cover.
A26
DomesticNonfinancialStatistics • August 1994
1.35 INTEREST RATES
Money and Capital Markets
Averages, percent per year; figures are averages of business day data unless otherwise noted
1994
Item
1991
1992
1994, week ending
1993
Feb.
Mar.
Apr.
May
Apr. 29
May 6
May 13
May 20
May 27
MONEY MARKET INSTRUMENTS
1 Federal funds1'2'3
2 Discount window borrowing2,
5.69
5.45
3.52
3.25
3.02
3.00
3.25
3.00
3.34
3.00
3.56
3.00
4.01
3.24
3.59
3.00
3.76
3.00
3.70
3.00
4.02
3.14
4.22
3.50
3
4
5
Commercial paper3,5'6
1-month
3-month
6-month
5.89
5.87
5.85
3.71
3.75
3.80
3.17
3.22
3.30
3.39
3.49
3.62
3.63
3.85
4.08
3.81
4.05
4.40
4.28
4.57
4.92
3.89
4.15
4.56
4.05
4.38
4.76
4.37
4.73
5.07
4.35
4.61
4.96
4.33
4.55
4.89
6
7
8
Finance paper, directly placed3,5,7
1-month
3-month
6-month
5.73
5.71
5.60
3.62
3.65
3.63
3.12
3.16
3.15
3.30
3.40
3.39
3.53
3.71
3.70
3.71
3.94
4.03
4.19
4.44
4.45
3.81
4.07
4.15
3.97
4.23
4.26
4.30
4.60
4.53
4.25
4.48
4.50
4.23
4.42
4.49
9
10
Bankers acceptances3,5,8
3-month
6-month
5.70
5.67
3.62
3.67
3.13
3.21
3.40
3.56
3.73
3.96
3.%
4.27
4.45
4.77
4.06
4.39
4.31
4.65
4.63
4.95
4.46
4.77
4.41
4.72
11
12
13
Certificates qf9 deposit, secondary
market*'
1-month
3-month
6-month
5.82
5.83
5.91
3.64
3.68
3.76
3.11
3.17
3.28
3.31
3.43
3.62
3.56
3.77
4.03
3.75
4.01
4.38
4.23
4.51
4.90
3.84
4.12
4.50
4.02
4.35
4.74
4.34
4.68
5.09
4.29
4.53
4.91
4.28
4.49
4.84
5.86
3.70
3.18
3.43
3.75
4.00
4.51
4.14
4.33
4.71
4.53
4.49
5.38
5.44
5.52
3.43
3.54
3.71
3.00
3.12
3.29
3.25
3.43
3.69
3.50
3.78
4.11
3.68
4.09
4.57
4.14
4.60
5.03
3.85
4.26
4.72
4.04
4.47
4.96
4.19
4.74
5.19
4.16
4.56
4.95
4.18
4.61
5.00
5.42
5.49
5.54
3.45
3.57
3.75
3.02
3.14
3.33
3.21
3.38
3.59
3.52
3.79
4.03
3.74
4.13
4.30
4.19
4.64
4.77
3.85
4.25
n.a.
4.00
4.41
4.77
4.32
4.81
n.a.
4.22
4.69
n.a.
4.23
4.63
n.a.
5.86
6.49
6.82
7.37
7.68
7.86
n.a.
8.14
3.89
4.77
5.30
6.19
6.63
7.01
n.a.
7.67
3.43
4.05
4.44
5.14
5.54
5.87
6.29
6.59
3.87
4.47
4.83
5.40
5.72
5.97
6.57
6.49
4.32
5.00
5.40
5.94
6.28
6.48
7.00
6.91
4.82
5.55
5.99
6.52
6.80
6.97
7.40
7.27
5.31
5.97
6.34
6.78
7.01
7.18
7.54
7.41
4.99
5.67
6.08
6.56
6.77
6.96
7.34
7.22
5.23
5.91
6.30
6.76
7.00
7.16
7.51
7.38
5.49
6.15
6.54
6.98
7.22
7.37
7.69
7.56
5.23
5.85
6.20
6.65
6.87
7.06
7.44
7.31
5.29
5.94
6.30
6.73
6.94
7.14
7.54
7.40
8.16
7.52
6.45
6.44
6.90
7.32
7.47
7.27
7.44
7.62
7.36
7.46
6.56
6.99
6.92
6.09
6.48
6.44
5.38
5.82
5.60
5.06
5.52
5.40
5.29
5.74
5.91
5.44
5.87
6.23
n.a.
n.a.
6.19
5.47
5.91
6.16
5.53
5.95
6.18
5.58
5.97
6.32
5.66
6.05
6.14
5.72
6.11
6.13
9.23
8.55
7.54
7.39
7.78
8.17
8.28
8.11
8.26
8.41
8.19
8.27
8.77
9.05
9.30
9.80
9.32
8.14
8.46
8.62
8.98
8.52
7.22
7.40
7.58
7.93
7.46
7.08
7.29
7.44
7.76
7.45
7.48
7.69
7.82
8.13
7.82
7.88
8.08
8.22
8.52
8.20
7.99
8.19
8.32
8.62
8.37
7.81
8.01
8.14
8.46
8.27
7.97
8.17
8.30
8.59
8.51
8.12
8.32
8.45
8.74
8.46
7.89
8.10
8.23
8.53
8.23
7.98
8.18
8.31
8.62
8.30
8.17
3.24
7.46
2.99
6.89
2.78
7.00
2.70
7.07
2.78
7.33
2.90
7.44
2.89
7.34
2.88
7.43
2.88
7.44
2.95
7.44
2.87
7.43
2.86
14 Eurodollar deposits, 3-month3,10
18
19
20
U.S. Treasury bills
Secondary market3,5
3-month
6-month
1-year
Auction average • •
3-month
6-month
1-year
21
22
23
24
25
26
27
28
Constant maturities12
1-year
2-year
3-year
5-year
7-year
10-year
20-year
30-year
15
16
17
U . S . TREASURY NOTES AND BONDS
Composite
29 More than 10 years (long-term)
STATE AND LOCAL NOTES AND BONDS
Moody's series13
30
31 Baa
32 Bond Buyer series1
CORPORATE BONDS
33 Seasoned issues, all industries15
Rating group
34
35
36
37
38
Aa
A
Baa
A-rated, recently offered utility bonds16
MEMO
Dividend-price ratio17
39 Preferred stocks
40 Common stocks
1. The daily effective federal funds rate is a weighted average of rates on
trades through New York brokers.
2. Weekly figures are averages of seven calendar days ending on Wednesday
of the current week; monthly figures include each calendar day in the month.
3. Annualized using a 360-day year or bank interest.
4. Rate for the Federal Reserve Bank of New York.
5. Quoted on a discount basis.
6. An average of offering rates on commercial paper placed by several leading
dealers for firms whose bond rating is AA or the equivalent.
7. An average of offering rates on paper directly placed by finance companies.
8. Representative closing yields for acceptances of the highest-rated money
center banks.
9. An average of dealer offering rates on nationally traded certificates of
deposit.
10. Bid rates for Eurodollar deposits at 11:00 a.m. London time. Data are for
indication purposes only.
11. Auction date for daily data; weekly and monthly averages computed on an
issue-date basis.
12. Yields on actively traded issues adjusted to constant maturities. Source:
U.S. Treasury.
13. General obligations based on Thursday figures; Moody's Investors Service.
14. General obligations only, with twenty years to maturity, issued by twenty
state and local governmental units of mixed quality. Based on figures for
Thursday.
15. Daily figures from Moody's Investors Service. Based on yields to maturity
on selected long-term bonds.
16. Compilation of the Federal Reserve. This series is an estimate of the yield
on recently offered, A-rated utility bonds with a thirty-year maturity and five
years of call protection. Weekly data are based on Friday quotations.
17. Standard & Poor's corporate series. Preferred stock ratio is based on a
sample of ten issues: four public utilities, four industrials, one financial, and one
transportation. Common stock ratio is based on the 500 stocks in the price index.
NOTE. Some of the data in this table also appear in the Board's H.15 (519)
weekly and G.13 (415) monthly statistical releases. For ordering address, see
inside front cover.
Financial Markets
1.36 STOCK MARKET
All
Selected Statistics
1993
Indicator
1991
1992
1994
1993
Sept.
Nov.
Oct.
Jan.
Dec.
Feb.
Mar.
Apr.
May
Prices and trading volume (averages of daily figures)
Common stock prices (indexes)
1 New York Stock Exchange
(Dec. 31, 1965 = 50)
2 Industrial
3 Transportation
4 Utility
5 Finance
206.35
258.16
173.97
92.64
150.84
229.00
284.26
201.02
99.48
179.29
249.71
300.10
242.68
114.55
216.55
254.86
300.92
247.74
122.32
229.35
257.53
306.61
254.04
120.49
228.18
255.93
310.84
262.96
115.08
214.08
257.73
313.22
268.11
114.97
216.00
262.11
320.92
278.29
112.67
218.71
261.97
322.41
276.67
116.22
217.12
257.32
318.08
265.68
107.72
211.02
247.97
304.48
250.43
105.04
208.12
249.56
307.58
244.75
102.89
211.30
6 Standard & Poor's Corporation
(1941-43 = 10)'
376.20
415.75
451.63
459.24
463.90
462.89
465.95
472.99
471.58
463.81
447.23
450.90
7 American Stock Exchange
(Aug. 31, 1973 = 50?
360.32
391.28
438.77
454.91
472.73
472.41
465.95
481.14
476.25
465.72
437.01
437.54
179,411
12,486
202,558
14,171
263,374
n.a.
261,770
18,889
280,503
21,279
277,886
18,436
259,457
17,461
313,223
19,211
307,269
19,630
311,0%
19,481
301,242
15,805
269,812
15,727
Volume of trading (thousands of shares)
8 New York Stock Exchange
9 American Stock Exchange
Customer financing (millions of dollars, end-of-period balances)
10 Margin credit at broker-dealers
36,660
43,990
60,310
53,700
56,690
59,760
60,310
61,250
62,020
61,960
60,700
59,870
Free credit balances at brokers4
11 Margin accounts
12 Cash accounts
8,290
19,255
8,970
22,510
12,360
27,715
10,030
23,170
10,270
22,450
10,940
23,560
12,360
27,715
12,125
26,020
12,890
25,665
13,185
26,190
13,175
24,800
12,715
23,265
Margin requirements (percent of market value and effective date)6
13 Margin stocks
14 Convertible bonds
15 Short sales
Mar. 11, 1968
June 8, 1968
May 6, 1970
Dec. 6, 1971
Nov. 24, 1972
Jan. 3, 1974
70
50
70
80
60
80
65
50
65
55
50
55
65
50
65
50
50
50
1. Effective July 1976, includes a new financial group, banks and insurance
companies. With this change the index includes 400 industrial stocks (formerly
425), 20 transportation (formerly 15 rail), 40 public utility (formerly 60), and 40
financial.
2. On July 5,1983, the American Stock Exchange rebased its index, effectively
cutting previous readings in half.
3. Since July 1983, under the revised Regulation T, margin credit at brokerdealers has included credit extended against stocks, convertible bonds, stocks
acquired through the exercise of subscription rights, corporate bonds, and
government securities. Separate reporting of data for margin stocks, convertible
bonds, and subscription issues was discontinued in April 1984.
4. Free credit balances are amounts in accounts with no unfulfilled commitments to brokers and are subject to withdrawal by customers on demand.
5. New series since June 1984.
6. These requirements, stated in regulations adopted by the Board of Governors pursuant to the Securities Exchange Act of 1934, limit the amount of credit
that can be used to purchase and carry "margin securities" (as defined in the
regulations) when such credit is collateralized by securities. Margin requirements
on securities other than options are the difference between the market value (100
percent) and the maximum loan value of collateral as prescribed by the Board.
Regulation T was adopted effective Oct. 15, 1934; Regulation U, effective May 1,
1936; Regulation G, effective Mar. 11, 1968; and Regulation X, effective Nov. 1,
1971.
On Jan. 1, 1977, the Board of Governors for the first time established in
Regulation T the initial margin required for writing options on securities, setting
it at 30 percent of the current market value of the stock underlying the option. On
Sept. 30, 1985, the Board changed the required initial margin, allowing it to be the
same as the option maintenance margin required by the appropriate exchange or
self-regulatory organization; such maintenance margin rules must be approved by
the Securities and Exchange Commission. Effective Jan. 31, 1986, the SEC
approved new maintenance margin rules, permitting margins to be the price of the
option plus 15 percent of the market value of the stock underlying the option.
Effective June 8, 1988, margins were set to be the price of the option plus 20
percent of the market value of the stock underlying the option (or 15 percent in the
case of stock-index options).
A28 Domestic Financial Statistics • August 1994
1.38 FEDERAL FISCAL AND FINANCING OPERATIONS
Millions of dollars
Fiscal year
Calendar year
Type of account or operation
1993
1991
U.S. budget1
1 Receipts, total
2 On-budget
3 Off-budget
4 Outlays, total
5 On-budget
6 Off-budget
7 Surplus or deficit ( - ) , total
8 On-budget
9 Off-budget
Source of financing (total)
10 Borrowing from the public
11 Operating cash (decrease, or increase (-)) . . .
12 Other^
1992
1994
1993
Dec.
Jan.
Feb.
Mar.
Apr.
May
1,054,272
760,388
293,885
1,323,793
1,082,106
241,687
-269,521
-321,719
52,198
1,090,453
788,027
302,426
1,380,856
1,128,518
252,339
-290,403
-340,490
50,087
1,153,226
841,292
311,934
l,408,484rr
l,141,897
266,587
-255,258rr
—300,605
45,347
125,408
99,714
25,694
133,660
121,977
11,682
-8,252
-22,263
14,012
122,966
94,396
28,570
107,718
83,527
24,191
15,248
10,869
4,379
72,874
46,879
25,995
114,440
88,523
25,918
-41,566
-41,644
77
93,108
64,612
28,496
125,423
100,260
25,163
-32,315
-35,648
3,333
141,326
104,311
37,015
123,872
100,625
23,247
17,454
3,686
13,768
83,546
55,367
28,179
115,600
89,729
25,871
-32,054
-34,362
2,308
276,802
-1,329
-5,952
310,918
-17,305
-3,210
248,619
6,283r
356
13,995
-17,413
11,670
-6,933
-8,089
-226
31,633
19,666
-9,733
26,511
-6,461
12,265
-21,801
-4,124
8,471
27,649
21,537
-17,132
41,484
7,928
33,556
58,789
24,586
34,203
52,506
17,289
35,217
49,723
14,809
34,914
57,812
21,541
36,271
38,146
4,886
33,259
44,607
6,181
38,426
48,731
7,965
40,766
27,194
5,675
21,519
MEMO
13 Treasury operating balance (level, end of
period)
14 Federal Reserve Banks
15 Tax and loan accounts
1. In accordance with the Balanced Budget and Emergency Deficit Control Act
of 1985, all former off-budget entries are now presented on-budget. Federal
Financing Bank (FFB) activities are now shown as separate accounts under the
agencies that use the FFB to finance their programs. The act has also moved two
social security trust funds, (federal old-age survivors insurance and federal
disability insurance) off-budget. The Postal Service is included as an off-budget
item in the Monthly Treasury Statement beginning in 1990.
2. Includes special drawing rights (SDRs); reserve position on the U.S. quota
in the International Monetary Fund (IMF); loans to the IMF; other cash and
monetary assets; accrued interest payable to the public; allocations of SDRs;
deposit funds; miscellaneous liability (including checks outstanding) and asset
accounts; seigniorage; increment on gold; net gain or loss for U.S. currency
valuation adjustment; net gain or loss for IMF loan-valuation adjustment; and
profit on sale of gold.
SOURCES. U.S. Department of the Treasury, Monthly Treasury Statement of
Receipts and Outlays of the U.S. Government and Office of Management and
Budget, Budget of the U.S. Government.
Federal Finance
A29
1.39 U.S. BUDGET RECEIPTS AND OUTLAYS 1
Millions of dollars
Calendar year
Fiscal year
1992
1994
1993
1992
Source or type
19931
HI
H2
HI
H2
Mar.
Apr.
RECEIPTS
1 All sources
2 Individual income taxes, net
3 Withheld
4 Presidential Election Campaign Fund .
5 Nonwithheld
6 Refunds
Corporation income taxes
7 Gross receipts
8 Refunds
9 Social insurance taxes and contributions,
net
10 Employment taxes and
contributions2
11
Self-employment taxes and
contributions3
12 Unemployment insurance
13 Other net receipts 4
14
15
16
17
Excise taxes
Customs deposits
Estate and gift taxes
Miscellaneous receipts
1,090,453
1,153,226
560,318
540,484
593,212
582,054
93,108
141,326
475,964
408,352
30
149,342
81,760
509,680
430,217
28
154,982
75,546
236,576
198,868
246,938
215,584
10
39,288
7,942
255,556
209,535r
25
113,506r
67,468
262,073
228,429
41,765
8,114
29,917
42,805
14
4,434
17,336
60,038
34,979
17
47,201
21,994
1,408
20
110,995
73,308
2
22,160
117,951
17,680
131,548
14,027
61,682
9,403
58,022
7,219
69,044
7,198
68,266
6,514
17,234
1,660
413,689
428,300
224,569
192,599
227,177
206,174
36,957
50,323
385,491
396,939
208,110
180,758
208,776
192,749
35,976
47,348
24,421
23,410
4,788
20,604
26,556
4,805
20,434
14,070
2,389
3,988
9,397
2,445
16,270
16,074
2,326
4,335
11,010
2,417
1,630
522
459
13,754
2,605
370
45,569
17,359
11,143
26,459
48,057
12,577
18,273
22,389
8,146
5,701
10,658
23,456
9,497
5,733
11,458
23,398
8,860
6,494
9,879
25,994
10,215
6,617
9,227
5,285
1,745
1,211
2,418
4,050
1,479
2,378
2,472
l,380,856r
1,408,484
704,266
723,527
673,915r
728,200r
125,423
123,872
24,501
1,554
1,238
316
1,463
1,641
2,845
1,276
-702
2,620
938
18,802
OUTLAYS
18 All types
17,030
4,319
20,239
20,443
147,065
8,540
7,951
1,442
8,594
7,526
155,231
9,916
8,521
3,109
11,467
8,852
140,535
6,565
7,9%
2,462
8,592
11,872
146,177
10,534
8,904
1,641
11,077
7,335
24,476
6%
1,685
510
1,631
1,439
10,083r
33,333
6,838
-22,725
35,004
9,051
15,615
15,651
3,903
-7,697
18,425
4,464
-14,537 r
16,076r
4,929
-1,724
20,375
5,606
-1,260
45,248r
50,012
23,767
21,241
24,106r
25,515
2,285
3,694
89,497
406,569 r
196,958
99,415
435,137
207,257
44,164
205,500
104,537
47,232
232,109
98,382
49,882
195,933 r
107,863
52,631
223,735
103,163
10,014
40,350
20,549
8,410
37,872
20,957
34,138r
14,426
35,720
14,955
13,009
198,811
-37,386
15,597
7,435
5,050
100,161
-18,229
18,561
7,238
8,223
98,692
-20,628
16,385
7,482r
5,205
99,635
-17,035
19,848
7,448
6,565
99,%3
-20,407
2,793
1,760
779
16,594
-2,999
3,930
1,230
-148
17,080
-2,721
19
20
21
22
23
24
National defense
International affairs
General science, space, and technology .
Energy
Natural resources and environment
Agriculture
298,350
16,107
16,409
4,500'
20,025
15,205
291,086
25
26
27
28
Commerce and housing credit
Transportation
Community and regional development ..
Education, training, employment, and
social services
29 Health
30 Social security and Medicare
31 Income security
32
33
34
35
36
Veterans benefits and services
Administration of justice
General government
Net interest6
1
Undistributed offsetting receipts'
199,421r
-39,280
16,826
1. Functional details do not sum to total outlays for calendar year data because
revisions to monthly totals have not been distributed among functions. Fjscal year
total for outlays does not correspond to calendar year data because revisions from
the Budget have not been fully distributed across months.
2. Old-age, disability, and hospital insurance, and railroad retirement accounts.
3. Old-age, disability, and hospital insurance.
4. Federal employee retirement contributions and civil service retirement and
disability fund.
5. Deposits of earnings by Federal Reserve Banks and other miscellaneous receipts.
6. Includes interest received by trust funds.
7. Consists of rents and royalties for the outer continental shelf, U.S. government contributions for employee retirement, and certain asset sales.
SOURCES. U.S. Department of the Treasury, Monthly Treasury Statement of
Receipts and Outlays of the U.S. Government, and the U.S. Office of Management and Budget, Budget of the U.S. Government, Fiscal Year 1995.
A30
DomesticNonfinancialStatistics • August 1994
1.40 FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION
Billions of dollars, end of month
1992
1993
1994
Item
Mar. 31
June 30
1 Federal debt outstanding
3,897
2 Public debt securities
3 Held by public
4 Held by agencies
3,881
2,918
964
5 Agency securities
6 Held by public
Held by agencies
1
8 Debt subject to statutory limit
9 Public debt securities
10 Other debt1
Sept. 30
Dec. 31
Mar. 31
June 30
Sept. 30
Dec. 31
Mar. 31
4,001
4,083
4,1%
4,250
4,373
4,436
4,562
4,576
3,985
2,977
1,008
4,065
3,048
1,016
4,177
3,129
1,048
4,231
3,188
1,043
4,352
3,252
1,100
4,412
3,295
1,117
4,536
3,382
1,154
A
16
16
0
16
16
0
18
18
0
19
19
0
20
20
0
21
21
0
25
25
0
27
27
0
n.a.
1
3,784
3,891
3,973
4,086
4,140
4,256
4,316
4,446
4,491
3,783
0
3,890
0
3,972
0
4,085
0
4,139
0
4,256
0
4,315
0
4,445
0
4,491
0
4,145
4,145
4,145
4,145
4,145
4,370
4,900
4,900
4,900
I
1
•
MEMO
11 Statutory debt limit
1. Consists of guaranteed debt of U.S. Treasury and other federal agencies,
specified participation certificates, notes to international lending organizations,
and District of Columbia stadium bonds.
1.41 GROSS PUBLIC DEBT OF U.S. TREASURY
SOURCES. U.S. Department of the Treasury, Monthly Statement of the Public
Debt of the United States and Treasury Bulletin.
Types and Ownership
Billions of dollars, end of period
1993
Type and holder
1 Total gross public debt
2
3
4
5
6
7
8
9
10
11
12
13
14
By type
Interest-bearing
Marketable
Bills
Notes
Bonds
Nonmarketable1
State and local government series
Foreign issues
Government
Public
Savings bonds and notes 3
Government account series
Non-interest-bearing
By holder 4
15 U.S. Treasury and other federal agencies and trust funds
16 Federal Reserve Banks
1/ Private investors
18 Commercial banks
19 Money market funds
20 Insurance companies
21 Other companies
22 State and local treasuries
Individuals
23
Savings bonds
24
Other securities
Foreign and international5
25
26
Other miscellaneous investors
1990
1992
1994
1993
Q2
Q3
04
Ql
3,364.8
3,801.7
4,177.0
4,535.7
4,352.0
4,411.5
4,535.7
n.a.
3,362.0
2,195.8
527.4
1,265.2
388.2
1,166.2
160.8
43.5
43.5
.0
124.1
813.8
2.8
3,798.9
2,471.6
590.4
1,430.8
435.5
1,327.2
159.7
41.9
41.9
.0
135.9
959.2
2.8
4,173.9
2,754.1
657.7
1,608.9
472.5
1,419.8
153.5
37.4
37.4
.0
155.0
1,043.5
3.1
4,532.3
2,989.5
714.6
1,764.0
495.9
1,542.9
149.5
43.5
43.5
.0
169.4
1,150.0
3.4
4,349.0
2,860.6
659.3
1,698.7
487.6
1,488.4
152.8
43.0
43.0
.0
164.4
1,097.8
2.9
4,408.6
2,904.9
658.4
1,734.2
497.4
1,503.7
149.5
42.5
42.5
.0
167.0
1,114.3
2.9
4,532.3
2,989.5
714.6
1,764.0
495.9
1,542.9
149.5
43.5
43.5
.0
169.4
1,150.0
3.4
4,572.6
3,042.9
721.2
1,802.5
504.2
1,529.7
145.5
42.7
42.7
,0
172.6
1.138.4
3.3
828.3
259.8
2,288.3
171.5
45.4
142.0
108.9
490.4
968.7
281.8
2,563.2
233.4
80.0
168.7
150.8
520.3
1,047.8
302.5
2,839.9
294.0
79.4
197.5
192.5
534.8
1,153.5
334.2
3,047.7
316.0
80.5
216.0
213.0
564.0
1,099.8
328.2
2,938.4r
306.5
76.2
210.2r
206.1
553.9
1,116.7
325.7
2,983.0r
313.3
75.2
215.5r
215.6
558.0
1,153.5
334.2
3,047.7
316.0
80.5
216.0
213.0
564.0
126.2
107.6
458.4
637.7
138.1
125.8
491.8
651.3
157.3
131.9
549.7
702.4
171.9
137.9
623.3
725.0
166.5
136.4
568.2r
714.3
169.1
136.7
592.3r
707.2
171.9
137.9
623.3
725.0
1. Includes (not shown separately) securities issued to the Rural Electrification
Administration, depository bonds, retirement plan bonds, and individual retirement bonds.
2. Nonmarketable series denominated in dollars, and series denominated in
foreign currency held by foreigners.
3. Held almost entirely by U.S. Treasury and other federal agencies and trust
funds.
4. Data for Federal Reserve Banks and U.S. government agencies and trust
funds are actual holdings; data for other groups are Treasury estimates.
1991
n.a.
5. Consists of investments of foreign balances and international accounts in the
United States.
6. Includes savings and loan associations, nonprofit institutions, credit unions,
mutual savings banks, corporate pension trust funds, dealers and brokers, certain
U.S. Treasury deposit accounts, and federally sponsored agencies.
SOURCES. U.S. Treasury Department, data by type of security, Monthly
Statement of the Public Debt of the United States; data by holder, Treasury
Bulletin.
Federal Finance
1.42 U.S. GOVERNMENT SECURITIES DEALERS
A31
Transactions1
Millions of dollars, daily averages
1994, week ending
1994
Item
May 4
May 11
May 18
38,280
51,478
48,474
60,154
53,531
37,946
21,636
14,965
59,398
39,568
32,551
17,584
69,921
37,687
42,686
17,133
70,575
42,854
37,108
17,484
13,663
413
854
10,952
404
487
13,424
434
513
13,393
385
700
14,007
553
578
35,887
3,577
28,898
3,041
14,921
2,399
22,004
2,507
29,273
3,258
27,324
2,425
Mar. 30
Apr. 6
Apr. 13
Apr. 20
Apr. 27
50,420
63,400
64,117
46,593
55,007
56,202
40,471
29,625
15,977
58,870
43,769
31,054
19,170
69,629
47,199
42,450
22,206
46,897
35,305
28,702
12,728
56,159
43,142
27,106
14,610
12,927
664
536
12,901
504
623
13,740
613
601
13,503
572
674
13,398
667
530
24,765
3,409"
25,873
3,053
22,319
3,353"
25,199
3,502
Feb.
Mar
Apr.
53,692
54,077
68,772
48,599
34,562r
22,524
60,771
45,280
31,297"
19,964
11,177
695
525
23,264r
3,807
IMMEDIATE TRANSACTIONS2
By type of security
U.S. Treasury securities
1 Bills
Coupon securities, by maturity
2 Less than 3.5 years
3 3.5 to 7.5 years
4 7.5 to 15 years
15 years or more
5
Federal agency securities
Debt, by maturity
6
Less than 3.5 years
7
3.5 to 7.5 years
8
7.5 years or more
Mortgage-backed
9
Pass-throughs
10
All others
11
12
13
14
15
16
By type of counterparty
Primary dealers and brokers
U.S. Treasury securities
Federal agency securities
Debt
Mortgage-backed
Customers
U.S. Treasury securities
Federal agency securities
Debt
Mortgage-backed
123,507
138,966
154,331
109,384
128,265
107,415
125,505
140,471
147,846
1,666
ll,377 r
2,023
12,317"
2,143
13,076
1,961
12,896
2,301
12,735
2,206
17,002
2,176
14,977
1,774
8,402
2,514
10,880
2,283
12,039
1,502
13,400
83,756r
74,155"
69,188
77,296
91,270
60,841
67,760
58,942
75,073
75,429
80,330
10,731
15,693r
12,104
15,857"
11,884
15,849
12,993
12,776"
12,448
15,966
12,389
22,461
12,754
16,962
10,069
8,918
11,858
13,631
12,194
20,492
13,636
16,349
3,094
3,733"
3,904
2,865
7,797
3,246
3,701
1,899
3,281
3,341
3,315
3,197
2,932r
4,928r
13,903
3,399
2,465"
5,013"
14,204"
2,535
1,941
4,367
12,689
2,265
1,927"
4,018
1,747
1,326
3,870
10,396
2,336
1,873
4,038
13,279
2,720
2,209
3,741
11,295
3,034
2,150
5,125
13,653
3,701
12,808
3,288
2,354
5,804
16,078
6,416
14,074
3.315
2,037
5.316
13,297
237
211
201
181
133
105
126
35
269
36
49
85
99
37
90
255
6
211
178
33
30
6
70
100
31
19
64
50
58
17
65
39
24,752r
2,198
25,161"
1,522
22,207
1,022
15,597
887
31,634
1,276
29,053
983
18,667
747
12,799
1,141
18,605
1,001
29,441
691
20,732
823
3,329
899
1,613
2,595r
3,428
1,253
1,297
2,133"
3,767
877
1,091
1,654
3,134
1,388
1,907
6,423
1,522
1,766
1,964
3,387
735
1,079
1,549
2,884
589
711
1,570
3,171
912
1,041
1,682
3,105
570
844
1,440
4,717
904
1,177
2,069
4,968
498
1,368
2,732
952
801
514
308
559
144,393
137,235
FUTURES AND FORWARD
TRANSACTIONS4
By type of deliverable security
U.S. Treasury securities
17 Bills
Coupon securities, by maturity
18 Less than 3.5 years
19 3.5 to 7.5 years
20 7.5 to 15 years
21
15 years or more
Federal agency securities
Debt, by maturity
22
Less than 3.5 years
23
3.5 to 7.5 years
24
7.5 years or more
Mortgage-backed
25
Pass-throughs
26
Others 3
80
2,282
OPTIONS TRANSACTIONS5
27
28
29
30
31
By type of underlying security
U.S. Treasury, coupon
securities, by maturity
Less than 3.5 years
3.5 to 7.5 years
7.5 to 15 years
15 years or more
Federal agency, mortgagebacked securities
Pass-throughs
2,112"
1. Transactions are market purchases and sales of securities as reported to the
Federal Reserve Bank of New York by the U.S. government securities dealers on
its published list of primary dealers. Averages are based on the number of trading
days in the period. Immediate, forward, and futures transactions are reported at
principal value, which does not include accrued interest; options transactions are
reported at the face value of the underlying securities.
Dealers report cumulative transactions for each week ending Wednesday.
2. Transactions for immediate delivery include purchases or sales of securities
(other than mortgage-backed agency securities) for which delivery is scheduled in
five business days or less and "when-issued" securities that settle on the issue
date of offering. Transactions for immediate delivery of mortgage-backed agency
securities include purchases and sales for which delivery is scheduled in thirty business
days or less. Stripped securities are reported at market value by maturity of coupon or
corpus.
3. Includes such securities as collateralized mortgage obligations (CMOs), real
estate mortgage investment conduits (REMICs), interest-only securities (IOs),
and principal-only securities (POs).
1,390
394
4. Futures transactions are standardized agreements arranged on an exchange.
Forward transactions are agreements made in the over-the-counter market that
specify delayed delivery. All futures transactions are included regardless of time
to delivery. Forward contracts for U.S. Treasury securities and federal agency
debt securities are included when the time to delivery is more than five business
days. Forward contracts for mortgage-backed agency securities are included
when the time to delivery is more than thirty business days.
5. Options transactions are purchases or sales of put-and-call options, whether
arranged on an organized exchange or in the over-the-counter market, and include
options on futures contracts on U.S. Treasury and federal agency securities.
NOTE. In tables 1.42 and 1.43, " n . a . " indicates that data are not published
because of insufficient activity.
Data for several types of options transactions—U.S. Treasury securities, bills;
Federal agency securities, debt; and federal agency securities, mortgage-backed,
other than pass-throughs—are no longer available because activity is insufficient.
A32
DomesticNonfinancialStatistics • August 1994
1.43 U.S. GOVERNMENT SECURITIES DEALERS
Positions and Financing1
Millions of dollars
1994, week ending
1994
Item
Feb.
Mar.
Apr.
Mar. 30
Apr. 6
Apr. 13
Apr. 20
Apr. 27
May 4
May 11
May 18
Positions2
NET IMMEDIATE POSITIONS3
By type of security
U.S. Treasury securities
1 Bills
Coupon securities, by maturity
2
Less than 3.5 years
3
3.5 to 7.5 years
4
7.5 to 15 years
5
15 years or more
Federal agency securities
Debt, by maturity
6
Less than 3.5 years
7
3.5 to 7.5 years
8
7.5 years or more
Mortgage-backed
9
Pass-throughs
10
All others
Other money market instruments
11 Certificates of deposit
12 Commercial paper
13 Bankers acceptances
3,681
4,792
12,752
1,838
11,375
14,931
9,561
14,514
13,755
12,975
4,177
-9,169
-24,417
-2,424
5,994
-18,921rr
-25,482r
-4,212 r
2,016
-21,399
-26,208
-7,653
-3,026
-19,779
-25,156
-5,893
-1,151
-22,696
-24,087
-7,414
-889
-28,330
-25,521
-7,110
-2,258
-20,993
-28,030
-7,028
-3,008
-15,786
-28,722
-7,999
-4,496
-16,680
-21,939
-10,052
-5,701
-14,038
-23,055
-6,765
-6,305
-16,886
-23,503
-10,543
-7,376
12,031
3,226
3,798
8,925
4,707
4,174
8,667
5,728
5,276
6,919
5,009
3,695
8,500
5,542
4,775
7,982
5,834
5,211
7,924
5,792
5,133
9,589
5,785
5,860
10,178
5,572
5,404
7,544
5,292
4,574
7,991
5,575
4,850
51,071
28,837
51,257r
32,642
44,711
33,965
31,442
37,3%
37,717
35,632
55,359
33,098
46,279
33,640
43,266
31,996
33,569
38,006
43,369
35,419
36,402
32,901
3,925
7,619
777
2,431
5,489
553
2,728
5,398
589
1,840
4,799
475
1,702
4,839
383
2,240
4,409
498
2,206
5,774
484
4,160
6,040
969
3,791
6,451
574
2,765
4,895
411
3,240
5,322
568
-1,382
2,030r
2,133
2,384
1,058
3,029
3,092
1,711
942
-870
-1,975
-175
2,608rr
7,942r
-6,634
2,739rr
3,115
10,7 lO1
-10,009"^
1,579
2,536
7,992
-7,551
2,863
3,879
13,719
-7,813
2,116
2,458
10,982
-8,809
868
2,230
8,847
-7,581
1,995
1,711
7,178
-8,186
1,857
3,694
5,349
-6,372
542
2,624
8,087
-6,231
-397
2,990
6,152
-6,168
-74
2,790
4,449
-4,590
3
123
438
126r
127
-157 r
79
91
-62
161
-50
-56
206
138
-173
117
176
-144
38
91
24
16
6
-5
-18
-2
14
-25
43
23
-18
33
-37,532r -39,342rr -32,719
8,687
7,039
9,561
-241,652 -186,475 -154,901
-20,327
6,053
-164,886
-25,255
6,314
-148,732
-43,303
8,012
-159,956
-34,266
7,984
-135,899
-31,569
8,690
-173,125
-22,020
162
-157,263
-27,287
1,416
-139,404
-21,9%
1,055
-176,418
FUTURES AND FORWARD POSITIONS5
By type of deliverable security
U.S. Treasury securities
14 Bills
Coupon securities, by maturity
15
Less than 3.5 years
16
3.5 to 7.5 years
17
7.5 to 15 years
18
15 years or more
Federal agency securities
Debt, by maturity
19
Less than 3.5 years
20
3.5 to 7.5 years
7.5 years or more
21
Mortgage-backed
Pass-throughs
22
23
All others^
24 Certificates of deposit
-7
Financing®
Reverse repurchase agreements
25 Overnight and continuing
26 Term
268,842rr
409,814
292,435rr
398,126
275,469
396,537
273,517
406,468
292,619
361,633
295,517
400,928
289,758
402,640
229,746
425,162
267,732
375,066
287,508
389,128
305,958
358,758
Repurchase agreements
27 Overnight and continuing
28 Term
483,847
382,705
479,210
375,510
447,713
376,304
438,311
390,186
467,253
322,254
483,478
363,039
472,957
375,200
367,928
449,462
452,442
347,232
466,892
368,673
503,904
322,076
Securities borrowed
29 Overnight and continuing
30 Term
152,813rr
45,660
155,484rr
39,830
152,707
35,824
152,127
38,661
151,914
35,702
156,126
35,907
153,458
35,552
147,766
38,648
156,0%
29,923
160,022
30,729
162,316
29,800
Securities loaned
31 Overnight and continuing
32 Term
5,444
294
4,579
348
3,591
306
4,316
346
3,914
201
3,617
302
3,735
132
3,370
546
3,061
373
3,366
322
3,803
415
Collateralized loans
33 Overnight and continuing
16,243
20,074
24,153
24,751
23,876
26,035
25,339
22,431
21,564
22,206
21,513
MEMO: Matched book7
Reverse repurchase agreements
34 Overnight and continuing
35 Term
182,784
359,530
200,306
348,058
197,715
340,574
199,853
350,977
202,131
309,999
204,543
349,530
213,257
348,351
171,759
359,966
197,248
317,435
206,664
335,092
226,047
312,477
Repurchase agreements
36 Overnight and continuing
37 Term
240,887
290,676
244,375
286,309
232,199
286,839
234,106
302,695
241,528
243,751
255,676
281,812
253,576
284,981
181,833
337,164
226,400
271,650
239,950
293,001
257,419
254,480
1. Data for positions and financing are obtained from reports submitted to the
Federal Reserve Bank of New York by the U.S. government securities dealers on
its published list of primary dealers. Weeklyfiguresare close-of-business Wednesday data; monthly figures are averages of weekly data.
2. Securities positions are reported at market value.
3. Net immediate positions include securities purchased or sold (other than
mortgage-backed agency securities) that have been delivered or are scheduled to
be delivered in five business days or less and "when-issued" securities that settle
on the issue date of offering. Net immediate positions of mortgage-backed agency
securities include securities purchased or sold that have been delivered or are
scheduled to be delivered in thirty business days or less.
4. Includes such securities as collateralized mortgage obligations (CMOs), real
estate mortgage investment conduits (REMICs), interest-only securities (IOs),
and principal-only securities (POs).
5. Futures positions reflect standardized agreements arranged on an exchange.
Forward positions reflect agreements made in the over-the-counter market that
specify delayed delivery. All futures positions are included regardless of time to
delivery. Forward contracts for U.S. Treasury securities and federal agency debt
securities are included when the time to delivery is more than five business days.
Forward contracts for mortgage-backed agency securities are included when the
time to delivery is more than thirty business days.
6. Overnight financing refers to agreements made on one business day that
mature on the next business day; continuing contracts are agreements that remain
in effect for more than one business day but have no specific maturity and can be
terminated without advance notice by either party; term agreements have a fixed
maturity of more than one business day .
7. Matched-book data reflect financial intermediation activity in which the
borrowing and lending transactions are matched. Matched-book data are included
in thefinancingbreakdowns given above. The reverse repurchase and repurchase
numbers are not always equal because of the "matching" of securities of different
values or different types of collateralization.
NOTE. Data for futures and forward commercial paper and bankers acceptances and
for termfinancingof collateralized loans are no longer available because of insufficient
activity.
Federal Finance
1.44 FEDERAL AND FEDERALLY SPONSORED CREDIT AGENCIES
A33
Debt Outstanding
Millions of dollars, end of period
1994
1993
Agency
1990
1989
1991
1992
Nov.
Dec.
Jan.
Feb.
Mar.
411,805
434,668
442,772
483,970
568,021
570,711
581,886
592,751
604,421
35,664
7
10,985
328
42,159
7
11,376
393
41,035
7
9,809
397
41,829
7
7,208
374
44,055
7
5,801
255
45,193
6
5,315
255
44,988
6
5,315
80
44,753
6
5,315
99
44,291
6
4,853
114
0
6,445
17,899
0
0
6,948
23,435
0
0
8,421
22,401
0
0
10,660
23,580
0
0
9,732
28,260
0
0
9,732
29,885
0
0
9,732
29,855
0
0
9,732
29,601
0
0
9,732
29,586
0
10 Federally sponsored agencies7
11 Federal Home Loan Banks
12 Federal Home Loan Mortgage Corporation
13 Federal National Mortgage Association
14 Farm Credit Banks"
15 Student Loan Marketing Association
16 Financing Corporation10
17 Farm Credit Financial Assistance12 Corporation1
18 Resolution Funding Corporation
375,428
136,108
26,148
116,064
54,864
28,705
8,170
847
4,522
392,509
117,895
30,941
123,403
53,590
34,194
8,170
1,261
23,055
401,737
107,543
30,262
133,937
52,199
38,319
8,170
1,261
29,9%
442,141
114,733
29,631
166,300
51,910
39,650
8,170
1,261
29,9%
523,966
139,364
56,809
195,165
51,861
40,840
8,170
1,261
29,9%
525,518
141,577
49,993
201,112
53,123
39,784
8,170
1,261
29,9%
536,898
139,241
61,245
203,013
52,621
40,861
8,170
1,261
29,9%
547,998
137,862
70,482
206,493
52,839
40,407
8,170
1,261
29,9%
560,130
147,309
62,908
216,430
52,433
41,120
8,170
1,261
29,9%
MEMO
19 Federal Financing Bank debt13
134,873
179,083
185,576
154,994
126,490
128,187
125,182
123,304
120,103
10,979
6,195
4,880
16,519
0
11,370
6,698
4,850
14,055
0
9,803
8,201
4,820
10,725
0
7,202
10,440
4,790
6,975
0
5,795
9,732
4,760
6,325
0
5,309
9,732
4,760
6,325
0
5,309
9,732
2,760
6,075
0
5,309
9,732
1,760
6,075
0
4,847
9,732
0
6,075
0
53,311
19,265
23,724
52,324
18,890
70,896
48,534
18,562
84,931
42,979
18,172
64,436
38,619
17,561
43,698
38,619
17,578
45,864
38,619
17,511
45,176
38,619
17,512
43,667
38,209
17,360
43,880
1 Federal and federally sponsored agencies
2 Federal agencies
3 Defense Department1
4 Export-Import Bank2,3
5 Federal Housing Administration
6 Government National Mortgage Association certificates of
participation
7 Postal Service6
8 Tennessee Valley Authority
9 United States Railway Association6
20
21
22
23
24
Lending to federal and
federally sponsored agencies
Export-Import6 Bank3
Postal Service
Student Loan Marketing Association
Tennessee Valley Authority
United States Railway Association6
Other lending1*
25 Farmers Home Administration
26 Rural Electrification Administration
27 Other
1. Consists of mortgages assumed by the Defense Department between 1957
and 1963 under family housing and homeowners assistance programs.
2. Includes participation certificates reclassified as debt beginning Oct. 1,1976.
3. On-budget since Sept. 30, 1976.
4. Consists of debentures issued in payment of Federal Housing Administration
insurance claims. Once issued, these securities may be sold privately on the
securities market.
5. Certificates of participation issued before fiscal year 1969 by the Government
National Mortgage Association acting as trustee for the Farmers Home Administration, the Department of Health, Education, and Welfare, the Department of
Housing and Urban Development, the Small Business Administration, and the
Veterans' Administration.
6. Off-budget.
7. Includes outstanding noncontingent liabilities: notes, bonds, and debentures. Some data are estimated.
8. Excludes borrowing by the Farm Credit Financial Assistance Corporation,
shown on line 17.
9. Before late 1982, the Association obtained financing through the Federal
Financing Bank (FFB). Borrowing excludes that obtained from the FFB, which is
shown on line 22.
10. The Financing Corporation, established in August 1987 to recapitalize the
Federal Savings and Loan Insurance Corporation, undertook its first borrowing in
October 1987.
11. The Farm Credit Financial Assistance Corporation, established in January
1988 to provide assistance to the Farm Credit System, undertook its first
borrowing in July 1988.
12. The Resolution Funding Corporation, established by the Financial Institutions Reform, Recovery and Enforcement Act of 1989, undertook its first
borrowing in October 1989.
13. The FFB, which began operations in 1974, is authorized to purchase or sell
obligations issued, sold, or guaranteed by other federal agencies. Because FFB
incurs debt solely for the purpose of lending to other agencies, its debt is not
included in the main portion of the table in order to avoid double counting.
14. Includes FFB purchases of agency assets and guaranteed loans; the latter
are loans guaranteed by numerous agencies, with the amounts guaranteed by any
one agency generally being small. The Farmers Home Administration entry
consists exclusively of agency assets, whereas the Rural Electrification Administration entry consists of both agency assets and guaranteed loans.
A34
DomesticNonfinancialStatistics • August 1994
1.45 NEW SECURITY ISSUES
Tax-Exempt State and Local Governments
Millions of dollars
1994
1993
Type of issue or issuer,
or use
1992
1991
1
1993
154,402 215,191 279,945
1 All issues, new and refunding
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
May
21,900
18,094
24,520
16,560
14,698
15,461
10,129
12,388
By type of issue
2 General obligation
3 Revenue
55,100
99,302
78,611
136,580
90,599
189,346
7,495
14,405
6,422
11,672
6,542
17,978
4,622
11,000
4,365
8,553
7,371
8,090
3,469
6,660
4,029
8,359
By type of issuer
4 State
5 Special district or statutory authority2
6 Municipality, county, or township
24,939
80,614
48,849
25,295
129,686
60,210
28,285
164,169
84,972
3,216
9,875
8,418
885
10,992
4,528
1,265
16,485
6,770
1,235
10,672
4,653
921
10,263
3,514
3,302
6,145
6,014
1,013
5,235
3,881
1,158
8,085
3,145
116,953 120,272
91,434
7,261
6,734
9,543
5,558r
8,774r
10,114
8,147
9,125
22,071
17,334
20,058
21,7%
5,424
33,589
17,098
9,571
11,802
n.a.
6,381
29,519
547
304
593
1,764
518
3,737
1,416
979
687
n.a.
673
1,820
1,227
429
1,454
2,171
1,272
2,990
1,573
293
480
825
392
5,558
2,292
1,223
243
1,660
1,316
8,774
1,859
401
540
1,670
470
5,174
2,102
1,453
707
1,502
601
1,782
1,933
1,037
423
2,099
657
2,976
7 Issues for new capital
8
9
10
11
12
13
By use of proceeds
Education
Transportation
Utilities and conservation
Social welfare
Industrial aid
Other purposes
21,121
13,395
21,039
25,648
8,376
30,275
1. Par amounts of long-term issues based on date of sale.
2. Includes school districts.
1.46 NEW SECURITY ISSUES
SOURCES. Securities Data Company beginning January 1993; Investment
Dealer's Digest before then.
U.S. Corporations
Millions of dollars
1993
Type of issue, offering,
or issuer
1
1991
1992
1994
1993
Sept.
r
Oct.
Nov.
Dec.
r
Jan.
r
Feb.*
Mar.
Apr.
1 All issues
465,246
559,827
766,6%
64,495'
56,143
54,813
44,394
57,239*
47,135
52,100
31,146
2 Bonds2
389,822
471,502r
642,543
53,837
45,608
43,214
33,863r
51,512*
39,433
43,001
25,800
By type of offering
3 Public, domestic
4 Private placement, domestic
5 Sold abroad
286,930
74,930
27,962
378,058r
65,853
27,591
487,924r
116,240
38,379*
49,132
n.a.
4,705
42,645
n.a.
2,963
39,525
n.a.
3,689
32,282*
n.a.
1,582
46,068*
n.a.
5,444r
32,116
n.a.
7,317
40,427
n.a.
2,574
23,000
n.a.
2,800
86,628
36,666
13,598
23,944
9,431
219,555
82,058
43,lll r
9,979
48,055
15,394r
272,904
88,002r
60,443rr
10,756
56,272*
31,950*r
395,121
4,036
2,378
288
5,163
2,237
39,735
3,273
6,306
1,416
2,585
2,991
29,039
3,334
3,078
648
1,763
1,015
33,376
3,068
2,525
895
2,336
2,001
23,039*
4,635*
2,869
693
2,566
2,495
38,254*
3,511
2,362
100
1,868
2,212
29,380
2,416
3,419
870
1,489
2,090
32,717
2,010
2,073
540
1,510
1,798
17,868
12 Stocks2
75,424
88,325
124,153
10,658r
10,535
11,599*
10,531
5,727*
7,702
9,099
5,346
By type of offering
13 Public preferred
14 Common
15 Private placement
17,085
48,230
10,109
21,339
57,118
9,867
21,677
90,559
11,917
1,358
9,336
n.a.
2,549
7,987
n.a.
1,385
10,209
n.a.
650
9,881
n.a.
1,592
4,135*
n.a.
1,318
6,383
n.a.
1,969
6,564
n.a.
2,248
3,099
n.a.
24,111
19,418
2,439
3,474
475
25,507
22,723
20,231
2,595
6,532
2,366
33,879
22,271
25,761
2,237
7,050
3,439
49,889
2,274
2,242
153
908
248
4,666
2,121
1,842
128
1,103
18
5,323
2,169
3,061
221
371
1,074
4,486
2,267
1,970
162
129
1,603
4,381
1,564
1,516
78
293
n.a.
2,397*
1,807
1,682
703
203
120
3,800
2,891
1,547
980
480
0
4,360
2,669
785
106
75
0
1,715
6
7
8
9
10
11
16
17
18
19
20
21
By industry group
Manufacturing
Commercial and miscellaneous
Transportation
Public utility
Communication
Real estate and financial
By industry group
Manufacturing
Commercial and miscellaneous
Transportation
Public utility
Communication
Real estate and financial
1. Figures represent gross proceeds of issues maturing in more than one year;
they are the principal amount or number of units calculated by multiplying by the
offering price. Figures exclude secondary offerings, employee stock plans,
investment companies other than closed-end, intracorporate transactions, equities sold abroad, and Yankee bonds. Stock data include ownership securities
issued by limited partnerships.
2. Monthly data cover only public offerings.
3. Monthly data are not available.
SOURCES. IDD Information Services, Inc., Securities Data Company, and the
Board of Governors of the Federal Reserve System.
Securities Market and Corporate Finance A35
Net Sales and Assets 1
1.47 OPEN-END INVESTMENT COMPANIES
Millions of dollars
1994
1993
Item
1992
1993
1 Sales of own shares2
647,055
2 Redemptions
of own shares
3 Net sales3
447,140
199,915
4 Assets4
73,999
982,311
Oct.
Nov.
Dec.
Jan.
Feb.r
Mar.
Apr.
69,938
74,490
72,865
89,775
98,679
78,032
87,381
71,173
1
49,270
20,667
47,168
27,322
51,306
21,559
62,764
27,011
61,829
36,849
56,235
21,797
73,395
13,986
61,941
9,233
1
1
1,370,654
1,411,628
1,416,841 1,510,047
1,572,907
1,561,705
1,500,745
1,510,599
96,848
1,273,807
104,301
1,307,327
103,352
1,303,489
100,209
1,409,838
110,022
1,462,879
113,975
1,447,730
112,399
1,388,347
118,535
1,392,063
n.a.
1,056,310
5 Cash5
6 Other
Sept.
•
4. Market value at end of period, less current liabilities.
5. Includes all U.S. Treasury securities and other short-term debt securities.
SOURCE. Investment Company Institute. Data based on reports of membership,
which comprises substantially all open-end investment companies registered with
the Securities and Exchange Commission. Data reflect underwritings of new
companies.
1. Data on sales and redemptions exclude money market mutual funds but
include limited-maturity municipal bond funds. Data on asset positions exclude
both money market mutual funds and limited-maturity municipal bond funds.
2. Includes reinvestment of net income dividends. Excludes reinvestment of
capita] gains distributions and share issue of conversions from one fund to another
in the same group.
3. Excludes sales and redemptions resulting from transfers of shares into or out
of money market mutual funds within the same fund family.
1.48 CORPORATE PROFITS AND THEIR DISTRIBUTION
Billions of dollars; quarterly data at seasonally adjusted annual rates
1992
Account
1991
1 Profits with inventory valuation and
capital consumption adjustment
2 Profits before taxes
3 Profits tax liability
4 Profits after taxes
5 Dividends
6 Undistributed profits
7 Inventory valuation
8 Capital consumption adjustment
1992
1994
1993
1993R
Q2
Q3
Q4
QL
Q2
Q3
Q4R
QL
369.5
362.3
129.8
232.5
137.4
95.2
407.2
395.4
146.3
249.1
150.5
98.6
466.6
449.4
174.0
275.4
169.0
106.4
411.7
409.5
153.0
256.5
146.1
110.4
367.5
357.9
130.1
227.8
155.2
72.7
439.5
409.9
155.0
254.9
162.9
92.0
432.1
419.8
160.9
258.9
167.5
91.4
458.1
445.6
173.3
272.3
168.5
103.9
468.5
443.8
169.5
274.3
169.7
104.6
507.9
488.4
192.5
295.9
170.3
125.6
474.4
470.3
185.3
284.9
171.8
113.2
4.9
2.2
-5.3
17.1
-7.1
24.3
-13.7
16.0
-7.8
17.4
4.9
24.7
-12.7
25.1
-12.2
24.7
1.0
23.8
-4.3
23.9
-16.0
20.1
SOURCE. U.S. Department of Commerce, Survey of Current Business.
1.50 NONFARM BUSINESS EXPENDITURES
New Plant and Equipment
Billions of dollars; quarterly data at seasonally adjusted annual rates
1992
Industry
1992
1993
1994
1993
19941
Q4
Ql
Q2
Q3
Q4
Ql
Q21
Q31
1 Total nonfarm business
546.60
585.64
634.02
559.24
564.13
579.79
594.11
604.51
619.11
637.14
639.71
Manufacturing
2 Durable goods industries
3 Nondurable goods industries
73.32
100.69
81.33
97.84
90.12
101.49
73.30
103.56
79.11
95.94
80.88
96.21
81.99
100.18
83.35
99.04
86.98
99.06
92.42
102.54
90.86
101.21
Nonmanufacturing
4 Mining
Transportation
5 Railroad
6 Air
7 Other
Public utilities
8 Electric
9 Gas and other
10 Commercial and other2
8.88
10.03
10.75
8.47
8.89
9.10
11.14
10.98
11.30
10.34
10.79
6.67
8.93
7.04
6.23
6.43
9.22
6.79
4.07
10.50
7.04
7.60
6.97
6.00
7.30
9.17
6.00
6.54
9.04
5.91
6.92
8.88
7.01
4.95
9.78
6.69
4.27
10.94
6.07
4.53
9.50
7.10
4.02
11.04
48.22
23.99
268.84
52.26
23.46
298.83
52.62
25.03
332.65
49.57
24.50
278.24
49.92
23.59
284.21
50.51
24.04
297.46
52.74
22.88
303.47
55.88
23.33
310.20
48.63
24.26
326.98
53.30
24.01
334.44
54.85
25.19
334.65
1. Figures are amounts anticipated by business.
2. "Other" consists of construction, wholesale and retail trade, finance and
insurance, personal and business services, and communication.
SOURCE. U.S. Department of Commerce, Survey of Current Business.
A36
DomesticNonfinancialStatistics • August 1994
1.51 DOMESTIC FINANCE COMPANIES
Assets and Liabilities1
Billions of dollars, end of period; not seasonally adjusted
1992
Account
1991
1992
1993
1993
Q2
Q3
Q4
Q1
Q2
Q3
Q4
476.7
116.7
293.2
66.8
473.9
116.7
288.5
68.8
482.1
117.1
296.5
68.4
469.6
111.9
289.6
68.1
469.3
111.3
290.7
67.2
467.6
112.6
287.8
67.2
476.1
117.5
290.1
68.6
ASSETS
1 Accounts receivable, gross2
2 Consumer
3 Business
4 Real estate
480.6
121.9
292.9
65.8
482.1
117.1
296.5
68.4
55.1
12.9
50.8
15.8
49.0r
11.0*
51.2
12.3
50.8
12.0
50.8
15.8
47.4
15.5
47.5
13.8
47.9
11.1
49.0r
ll.tF
412.6
149.0
415.5
150.6
416.1rr
177.3
413.2
139.4
411.1
146.5
415.5
150.6
406.6
155.0
408.0
156.6
408.6
169.7
416. rr
177.3
561.6
566.1
r
593.4
552.6
557.6
566.1
561.6
564.6
578.3
593.4r
42.3
159.5
37.6
156.4
25.3
159.2
37.8
147.7
38.1
153.2
37.6
156.4
34.1
149.8
29.5
144.5
25.8
149.9
25.3
159.2
n.a.
n.a.
34.5
191.3
69.0
64.8
n.a.
n.a.
37.8
195.3
71.2
67.8
n.a.
n.a.
46.1
199.9
91.1
71.7
n.a.
n.a.
34.8
191.9
73.4
67.1
n.a.
n.a.
34.9
191.4
73.7
68.1
n.a.
n.a.
37.8
195.3
71.2
67.8
n.a.
n.a.
41.9
195.1
74.2
66.6
n.a.
n.a.
46.4
195.8
81.3
67.1
n.a.
n.a.
47.9
198.1
87.6
68.9
n.a.
n.a.
46.1
199.9
91.1
71.7
561.2
566.1
593.4
552.7
559.4
566.1
561.7
564.6
578.3
593.4
Feb.
Mar.
Apr.
5 LESS; Reserves for unearned income
6
Reserves for losses
7 Accounts receivable, net
8 All other
9 Total assets
476.1
117.5
290.1
68.6
LIABILITIES AND CAPITAL
10 Bank loans
11 Commercial paper
12
13
14
15
16
17
Debt
Other short-term
Long-term
Owed to parent
Not elsewhere classified
All other liabilities
Capital, surplus, and undivided profits
18 Total liabilities and capital
1. Includes finance company subsidiaries of bank holding companies but not of
retailers and banks. Data are amounts carried on the balance sheets of finance
companies; securitized pools are not shown, as they are not on the books.
1.52 DOMESTIC FINANCE COMPANIES
2. Before deduction for unearned income and losses,
Consumer, Real Estate, and Business Credit1
Millions of dollars, amounts outstanding, end of period
1993
Type of credit
1991
1992
1994
1993
Nov.
Dec.
Jan.
Seasonally adjusted
1 Total
519,910
534,845
532,828
532,687
532,828
535,567
539,513'
546,756
549,632
2 Consumer 2
3 Real estate
4 Business
154,822
65,383
299,705
157,707
68,011
309,127
159,791
68,174
304,863
157,438
68,540
306,709
159,791
68,174
304,863
159,313
69,441
306,813
160,371rr
69,543
309,599r
160,831
69,604
316,321
161,408
70,566
317,658
Not seasonally adjusted
5 Total
6 Consumer
7 Motor vehicles
8 Other consumer
9 Securitized motor vehicles
10 Securitized
other consumer
11 Real estate2
12 Business
13 Motor vehicles
14
Retail 5 ....6
15
Wholesale
16
Leasing
17 Equipment
18
Retail....,6
19
Wholesale
20
Leasing
21 Other business
22 Securitized business assets
23
Retail
24
Wholesale
25
Leasing
523,192
538,158
536,124
532,354
536,124
535,138
537,278r
546,925
155,713
63,415
58,522
23,166
10,610
65,760
301,719
90,613
22,957
31,216
36,440
141,399
30,962
9,671
100,766
60,900
8,807
576
5,285
2,946
158,631
57,605
59,522
29,775
11,729
68,410
311,118
87,456
19,303
29,962
38,191
151,607
32,212
8,669
110,726
57,464
14,590
1,118
8,756
4,716
160,734
55,274
62,189
34,659
157,848
55,337
59,463
34,301
8,747
68,718
305,788
88,510
16,723
29,260
42,526
146,703
32,360
7,802
106,541
53,886
16,690
1,953
9,407
5,330
160,734
55,274
62,189
34,659
159,186
56,509
61,427
32,924
8,325
69,385
306,568
88,377
16,965
27,975
43,437
147,915
33,109
7,996
106,810
50,821
19,456
1,696
12,358
5,402
158,543r
56,963
61,132r
32,280
159,448
57,797
62,264
31,439
7,948
69,005
318,472
95,719
19,162
31,070
45,487
149,721
33,861
1. Includes finance company subsidiaries of bank holding companies but not of
retailers and banks. Data are before deductions for unearned income and losses.
Data in this table also appear in the Board's G.20 (422) monthly statistical release.
For ordering address, see inside front cover.
2. Includes all loans secured by liens on any type of real estate, for example,
first and junior mortgages and home equity loans.
3. Includes personal cash loans, mobile home loans, and loans to purchase other
types of consumer goods such as appliances, apparel, general merchandise, and
recreation vehicles.
4. Outstanding balances of pools upon which securities have been issued; these
balances are no longer carried on the balance sheets of the loan originator.
8,611
68,577
306,814
90,172
16,024
31,067
43,081
148,858
33,266
8,007
107,585
51,054
16,730
1,830
9,697
5,203
8,611
68,577
306,814
90,172
16,024
31,067
43,081
148,858
33,266
8,007
107,585
51,054
16,730
1,830
9,697
5,203
8,168
69,446r
309,289*r
90,668r
17,514
29,435
43,720
147,425
33,033
7,972
106,420
51,489*
19,707
1,593
13,006
5,108
8,281
107,579
53,596
19,436
1,486
12,866
5,084
5. Passenger car fleets and commercial land vehicles for which licenses are
required.
6. Credit arising from transactions between manufacturers and dealers, that is,
floor plan financing.
7. Includes loans on commercial accounts receivable, factored commercial
accounts, and receivable dealer capital; small loans used primarily for business or
farm purposes; and wholesale and lease paper for mobile homes, campers, and
travel trailers.
Real Estate
1.53 MORTGAGE MARKETS
A37
Mortgages on New Homes
Millions of dollars except as noted
1994
1993
Item
1991
1992
1993
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
May
Terms and yields in primary and secondary markets
PRIMARY MARKETS
1
2
3
4
5
Terms1
Purchase price (thousands of dollars)
Amount of loan (thousands of dollars)
Loan-to-price ratio (percent)
Maturity (years)
Fees and charges (percent of loan amount)
Yield (percent per year)
6 Contract rate11 3
7 Effective rate '
8 Contract rate (HUD series)4
155.0
114.0
75.0
26.8
1.71
158.1
118.1
76.6
25.6
1.60
163.1
123.0
78.0
26.1
1.30
174.4
134.0
79.1
26.9
1.23
167.9
128.7
79.2
26.8
1.10
168.1
127.9
78.0
27.2
1.18
157.9
124.1
80.2
27.0
1.16
167.8
131.0
80.2
27.6
1.20
166.1
127.6
79.3
26.7
1.16
171.6
132.2
78.5
27.6
1.45
9.02
9.30
9.20
7.98
8.25
8.43
7.02
7.24
7.37
6.61
6.80
7.38
6.74
6.92
7.26
6.77
6.95
7.13
6.67
6.85
7.54
6.81
6.99
8.31
7.13
7.31
8.56
7.20
7.43
8.61
9.25
8.59
8.46
7.71
7.46
6.65
7.51
6.61
7.52
6.58
7.05
6.45
7.59
6.72
8.57
7.40
8.63
7.93
8.63
8.05
SECONDARY MARKETS
Yield (percent per year)
9 FHA mortgages (Section 203)5
10 GNMA securities6
Activity in secondary markets
FEDERAL NATIONAL MORTGAGE ASSOCIATION
Mortgage holdings (end of period)
11 Total
12 FHA/VA insured
13 Conventional
122,837
21,702
101,135
142,833
22,168
120,664
172,791
22,876
149,914
185,463
23,334
162,129
190,861
23,857
167,004
194,441
23,7%
170,645
1%,078
23,789
172,289
197,770
24,226
173,544
201,542
25,088
176,454
206,147
25,303
180,844
Mortgage transactions (during period)
14 Purchases
37,202
75,905
92,037
8,979
12,123
7,919
5,427
5,820
6,677
7,238
Mortgage commitments (during period)
15 Issued 8
16 To sell
40,010
7,608
74,970
10,493
92,537
5,097
11,144
0
8,461
209
6,159
664
4,858
525
8,683
136
4,788
90
3,801
281
Mortgage holdings (end of periodf
17 Total
18 FHA/VA insured
19 Conventional
24,131
484
23,283
29,959
408
29,552
42,789
327
42,462
52,933
324
52,610
55,012
321
54,691
56,067
319
55,747
57,245
318
56,928
58,498
315
59,184
59,352
309
59,043
60,799
304
60,495
Mortgage transactions (during period)
20 Purchases
21 Sales
99,965
92,478
191,125
179,208
229,242
208,723
27,062
24,028
29,396
26,607
22,611
21,253
17,840
16,719
15,970
14,486
14,589
14,175
10,629
10,228
114,031
261,637
274,599
39,977
24,176
31,393
12,880
22,533
22,765
9,586
FEDERAL HOME LOAN MORTGAGE CORPORATION
Mortgage commitments (during period)9
22 Contracted
1. Weighted averages based on sample surveys of mortgages originated by
major institutional lender groups for purchase of newly built homes; compiled by
the Federal Housing Finance Board in cooperation with the Federal Deposit
Insurance Corporation.
2. Includes all fees, commissions, discounts, and "points" paid (by the
borrower or the seller) to obtain a loan.
3. Average effective interest rate on loans closed for purchase of newly built
homes, assuming prepayment at the end of ten years.
4. Average contract rate on new commitments for conventional first mortgages; from U.S. Department of Housing and Urban Development (HUD). Based
on transactions on the first day of the subsequent month.
5. Average gross yield on thirty-year, minimum-downpayment first mortgages insured by the Federal Housing Administration (FHA) for immediate
delivery in the private secondary market. Based on transactions on first day of
subsequent month.
6. Average net yields to investors on fully modified pass-through securities
backed by mortgages and guaranteed by the Government National Mortgage
Association (GNMA), assuming prepayment in twelve years on pools of thirtyyear mortgages insured by the Federal Housing Administration or guaranteed by
the Department of Veterans Affairs.
7. Does not include standby commitments issued, but includes standby commitments converted.
8. Includes participation loans as well as whole loans.
9. Includes conventional and government-underwritten loans. The Federal
Home Loan Mortgage Corporation's mortgage commitments and mortgage transactions include activity under mortgage securities swap programs, whereas the
corresponding data for FNMA exclude swap activity.
A38
DomesticNonfinancialStatistics • August 1994
1.54 MORTGAGE DEBT OUTSTANDING 1
Millions of dollars, end of period
1993
Type of holder and property
1990
1991
Ql
1 All holders
2
3
4
5
By type of property
One- to four-family residences
Multifamily residences
Commercial
Farm
By type of holder
6 Majorfinancialinstitutions
7 Commercial banks
8
One- to four-family
Multifamily
9
10
Commercial
Farm
11
12 Savings institutions3
13
One- to four-family
14
Multifamily
15
Commercial
16
Farm
17 Life insurance companies
18
One- to four-family
19
Multifamily
Commercial
20
21
Farm
22 Federal and related agencies
23 Government National Mortgage Association
24
One- to four-family
Multifamily
25
26 Farmers Home Administration
27
One- to four-family
28
Multifamily
Commercial
29
30
Farm
31 Federal Housing and Veterans' Administrations
One- to four-family
32
Multifamily
33
34 Resolution Trust Corporation
35
One- to four-family
Multifamily
36
Commercial
37
Farm
38
39 Federal National Mortgage Association
One- to four-family
40
41
Multifamily
42 Federal Land Banks
43
One- to four-family
Farm
44
45 Federal Home Loan Mortgage Corporation
46
One- to four-family
Multifamily
47
48 Mortgage pools or trusts5
49 Government National Mortgage Association
One- to four-family
50
51
Multifamily
52 Federal Home Loan Mortgage Corporation
One- to four-family
53
Multifamily
54
55 Federal National Mortgage Association
One- to four-family
56
Multifamily
57
58 Farmers Home Administration
59
One- to four-family
Multifamily
60
Commercial
61
Farm
62
63 Private mortgage conduits
64
One- to four-family
Multifamily
65
Commercial
66
Farm
67
68 Individuals and others6
69 One- to four-family
70 Multifamily
71 Commercial
72 Farm
Q2
Q3
Q4
Ql"
3,762,872r 3,924,782r
4,049,256" 4,059,221" 4,108,890" 4,166,286" 4,208,512"
4,247,007
2,616,288r 2,780,044r
309,369
306,410
758,313r
759,023r
78,903
79,306
2,959,558rr 2,975,768" 3,034,781" 3,0%,443" 3,146,832"
295,417r
294,045"
291,272"
290,679
290,553"
713,862
708,966
698,435"
690,388"
702,210
80,419"
80,442"
80,627"
80,730"
80,739"
3,189,641
289,273
687,126
80,%7
1,914,315
844,826
455,931
37,015
334,648
17,231
801,628
600,154
91,806
109,168
500
267,861
13,005
28,979
215,121
10,756
1,846,726
876,100
483,623
36,935
337,095
18,447
705,367
538,358
79,881
86,741
388
265,258
11,547
29,562
214,105
10,044
1,769,187
894,513
507,780
38,024
328,826
19,882
627,972
489,622
69,791
68,235
324
246,702
11,441
27,770
198,269
9,222
1,753,045
891,755
507,497
37,425
326,853
19,980
617,163
480,415
70,608
65,808
332
244,128
11,316
27,466
1%,100
9,246
1,765,176
910,989
526,817
38,058
325,519
20,595
612,458
480,722
68,303
63,111
322
241,729
11,195
27,174
194,012
9,348
1,766,633"
940,253"
558,583"
38,436"
322,373"
20,862"
598,348"
469,689"
67,823"
60,531"
305"
228,032"
10,534"
25,568"
182,553"
9,376"
1,747,288
937,966
555,434
38,166
323,120
21,245
584,352
457,679
67,348
59,029
297
224,970
10,387
25,211
180,001
9,371
239,003
20
20
0
41,439
18,527
9,640
4,690
8,582
8,801
3,593
5,208
32,600
15,800
8,064
8,736
0
104,870
94,323
10,547
29,416
1,838
27,577
21,857
19,185
2,672
266,146
19
19
0
41,713
18,496
10,141
4,905
8,171
10,733
4,036
6,697
45,822
14,535
15,018
16,269
0
112,283
100,387
11,896
28,767
1,693
27,074
26,809
24,125
2,684
286,263
30
30
0
41,695
16,912
10,575
5,158
9,050
12,581
5,153
7,428
32,045
12,960
9,621
9,464
0
137,584
124,016
13,568
28,664
1,687
26,977
33,665
31,032
2,633
287,081
45
37
8
41,529
16,536
10,650
5,187
9,156
13,027
5,631
7,3%
27,331
11,375
8,070
7,886
0
141,192
127,252
13,940
28,536
1,679
26,857
35,421
32,831
2,589
298,991
45
38
7
41,446
16,133
10,739
5,250
9,324
12,945
5,635
7,311
21,973
8,955
6,743
6,275
0
151,513
137,340
14,173
28,592
1,682
26,909
42,477
39,905
2,572
309,579
43
37
7
41,424
15,714
10,830
5,347
9,533
11,797
4,850
6,947
19,925
8,381
6,002
5,543
0
160,721
146,009
14,712
28,810
1,695
27,115
46,859
44,315
2,544
321,486"
22"
15"
7
41,386
15,303
10,940
5,406
9,739
12,215
5,364
6,851
17,284
7,203"
5,327"
4,754"
0
166,642
151,310
15,332
28,460"
1,675"
26,785"
55,476
52,929
2,547
325,835
20
13
7
41,209
14,870
11,037
5,399
9,903
11,344
4,738
6,606
14,241
6,312
4,190
3,739
0
172,343
156,576
15,767
28,181
1,658
26,523
58,498
55,942
2,556
1,079,103
403,613
391,505
12,108
316,359
308,369
7,990
299,833
291,194
8,639
66
17
0
24
26
59,232
53,335
731
5,166
0
1,250,666
425,295
415,767
9,528
359,163
351,906
7,257
371,984
362,667
9,317
47
11
0
19
17
94,177
84,000
3,698
6,479
0
1,425,546
419,516
410,675
8,841
407,514
401,525
5,989
444,979
435,979
9,000
38
8
0
17
13
153,499
132,000
6,305
15,194
0
1,462,181
421,514
412,798
8,716
420,932
415,279
5,654
457,316
448,483
8,833
34
7
0
16
11
162,385
137,000
6,665
18,720
0
1,473,323
413,166
404,425
8,741
422,882
417,646
5,236
465,220
456,645
8,575
32
6
0
15
11
172,023
145,000
7,407
19,616
0
1,514,002
415,076
405,%3
9,113
430,089
425,154
4,935
481,880
473,599
8,281
30
6
0
14
10
186,927
158,000
7,991
20,936
0
530,452rr
349,491
85,969
80,761r
14,232
561,244rr
368,874
83,7%
93,410r
15,164
1. Based on data from various institutional and governmental sources; figures
for some quarters estimated in part by the Federal Reserve. Multifamily debt
refers to loans on structures of five or more units.
2. Includes loans held by nondeposit trust companies but not loans held by
bank trust departments.
3. Includes savings banks and savings and loan associations.
4. FmHA-guaranteed securities sold to the Federal Financing Bank were
reallocated from FmHA mortgage pools to FmHA mortgage holdings in 1986:Q4
because of accounting changes by the Farmers Home Administration.
1994
1992
568,260"
378,739"
85,871"
88,699"
14,951"
556,913"
367,632"
86,026"
88,3%
14,859"
571,400"
382,637"
86,235"
88,412
14,117"
1,769,014"
922,5%"
538,919"
37,633"
325,201"
20,843"
609,563"
478,324"
68,552"
62,367"
320
236,855
10,%7
26,620
190,061
9,206
573,691"
384,510"
86,512"
88,966"
13,703"
1,546,818
414,066
404,864
9,202
439,029
434,494
4,535
495,525
486,804
8,721
28
5
0
13
10
198,171
164,000
8,701
25,469
0
573,576"
384,060"
86,565"
89,289"
13,662"
1,602,595
423,446
414,194
9,251
457,577
453,407
4,170
507,376
498,489
8,887
26
5
0
12
9
214,171
177,000
9,481
27,689
0
571,289
382,938
86,597
88,137
13,618
5. Outstanding principal balances of mortgage-backed securities insured or
guaranteed by the agency indicated.
6. Other holders include mortgage companies, real estate investment trusts,
state and local credit agencies, state and local retirement funds, noninsured
pension funds, credit unions, and finance companies.
SOURCES. Based on data from various institutional and government sources.
Separation of nonfarm mortgage debt by type of property, if not reported directly,
and interpolations and extrapolations, when required, are estimated mainly by the
Federal Reserve. Line 64, from Inside Mortgage Securities.
Consumer Installment Credit
A39
1.55 CONSUMER INSTALLMENT CREDIT1
Millions of dollars, amounts outstanding, end of period
1994
1993
Holder and type of credit
1991
1992
1993
Nov.
Dec.
Jan.
Feb.
r
Mar.
Apr.
Seasonally adjusted
1 Total
733,510
741,093
790,082
782,561
790,082
796,458
800,440
808,872
817,755
2 Automobile
3 Revolving
4 Other
260,898
243,564
229,048
259,627
254,299
227,167
278,321
281,474
230,288
276,853
279,273
226,435
278,321
281,474
230,288
279,046
284,898
232,514
280,444
287,414
232,582
284,232
288,838
235,802
287,048
293,816
236,890
Not seasonally adjusted
749,052
756,944
807,298
784,148
807,298
801,883
798,387
801,251
811,393
340,713
121,937
92,681
39,832
45,965
4,362
103,562
331,869
117,127
97,641
42,079
43,461
4,365
120,402
367,140
117,464
114,451
47,382
33,000
4,212
123,649
358,429
114,800
112,342
42,047
33,500
4,507
118,523
367,140
117,464
114,451
47,382
33,000
4,212
123,649
365,607
117,937
115,055
44,986
32,500
4,189
121,609
365,136
118,095
116,034
43,164
32,000
3,952
120,006
368,653
120,061
117,962
43,088
31,751
3,769
115,967
374,920
122,845
120,091
42,866
31,750
3,980
114,941
n Automobile
261,219
112,666
63,415
28,915
259,964
109,743
57,605
33,878
278,690
123,734
55,274
36,781
277,060
122,989
55,337
36,569
278,690
123,734
55,274
36,781
278,265
123,916
56,509
34,947
278,733
124,491
56,%3
34,217
281,674
126,866
57,797
33,275
285,297
129,833
59,458
31,454
17 Revolving
18 Commercial banks
19 Retailers
20 Gasoline companies
21 Pools of securitized assets
256,876
138,005
34,712
4,362
63,595
267,949
132,582
36,629
4,365
74,243
296,445
148,698
41,378
4,212
77,416
280,080
142,382
36,319
4,507
72,357
2%,445
148,698
41,378
4,212
77,416
290,197
144,874
39,057
4,189
77,280
286,351
143,633
37,293
3,952
76,581
285,025
145,157
37,191
3,769
73,722
289,703
148,380
36,966
3,980
74,782
7? Other
7,3 Commercial banks
24 Finance companies
25 Retailers
26 Pools of securitized assets2
230,957
90,042
58,522
5,120
11,052
229,031
89,544
59,522
5,450
12,281
232,162
94,708
62,189
6,004
9,452
227,008
93,058
59,463
5,728
9,597
232,162
94,708
62,189
6,004
9,452
233,420
96,817
61,427
5,929
9,382
233,303
97,012
61,132
5,871
9,208
234,552
96,630
62,264
5,897
8,970
236,393
96,707
63,387
5,900
8,705
5 Total
6
7
8
9
10
11
12
By major holder
Commercial banks
Finance companies
Credit unions
Retailers
Savings institutions
Gasoline companies
Pools of securitized assets
By major type of credit*
14
15
16
Commercial banks
Finance companies
Pools of securitized assets2
1. The Board's series on amounts of credit covers most short- and
intermediate-term credit extended to individuals that is scheduled to be repaid (or
has the option of repayment) in two or more installments.
Data in this table also appear in the Board's G.19 (421) monthly statistical
release. For ordering address, see inside front cover.
2. Outstanding balances of pools upon which securities have been issued; these
balances are no longer carried on the balance sheets of the loan originator.
3. Totals include estimates for certain holders for which only consumer credit
totals are available.
1.56 TERMS OF CONSUMER INSTALLMENT CREDIT1
Percent per year except as noted
1994
1993
Item
1991
1992
1993
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
INTEREST RATES
Commercial banks2
48-month new car
24-month personal
120-month mobile home
Credit card
11.14
15.18
13.70
18.23
9.29
14.04
12.67
17.78
8.09
13.47
11.87
16.83
n.a.
n.a.
n.a.
n.a.
7.63
13.22
11.55
16.30
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
7.54
12.89
11.56
16.06
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
Auto finance companies
5 New car
6 Used car
12.41
15.60
9.93
13.80
9.48
12.79
9.25
12.58
8.96
12.41
8.80
12.33
7.55
12.02
8.93
12.23
9.13
12.68
9.71
13.25
55.1
47.2
54.0
47.9
54.5
48.8
55.0
48.2
54.5
48.4
54.0
48.3
52.9
50.0
54.4
50.3
54.0
50.1
53.8
50.0
88
96
89
97
91
98
90
98
91
98
90
98
91
98
91
99
92
99
92
99
12,494
8,884
13,584
9,119
14,332
9,875
14,650
9,969
14,839
10,230
15,097
10,349
15,330
10,434
14,904
10,449
14,821
10,427
15,067
10,477
1
2
3
4
OTHER TERMS 3
Maturity (months)
8 Used car
Loan-to-value ratio
9 New car
10 Used car
Amount financed (dollars)
11 New car
12 Used car
1. The Board's series on amounts of credit covers most short- and intermediate-term credit extended to individuals that is scheduled to be repaid (or has the
option of repayment) in two or more installments. Data in this table also appear in
the Board's G.19 (421) monthly statistical release. For ordering address, see
inside front cover.
2. Data are available for only the second month of each quarter,
3. At auto finance companies,
A40
DomesticNonfinancialStatistics • August 1994
1.57 FUNDS RAISED IN U.S. CREDIT MARKETS1
Billions of dollars; quarterly data at seasonally adjusted annual rates
1992
Q3
1993
04
1994
Q1
Q2
Q3R
Q4R
Q1
Nonfinancial sectors
1 Total net borrowing by domestic nonfinancial sectors ..
723.0
631.0
475.5
582.4
592.3
611.1
529.5
382.6r
719.2r
584.2
683.2
620.0
By sector and instrument
2 U.S. government
3 Treasury securities
4 Budget agency issues and mortgages
146.4
144.7
1.6
246.9
238.7
8.2
278.2
292.0
-13.8
304.0
303.8
.2
256.1
248.3
7.8
299.1
290.1
9.0
240.1
237.4
2.7
229.6
226.4
3.2
348.2
344.1
4.1
177.2
160.9
16.2
269.6
261.9
7.7
195.9
197.2
-1.3
5 Private
576.6
384.1
197.3
278.4
336.2
312.0
289.4
153.1R
370.9R
407.0
413.6
424.1
6
7
8
9
10
11
12
13
14
15
16
By instrument
Tax-exempt obligations
Corporate bonds
Mortgages
Home mortgages
Multifamily residential
Commercial
Farm
Consumer credit
Bank loans n.e.c
Commercial paper
Other loans
65.3
73.8
269.1
212.5
12.0
47.3
-2.7
49.5
36.4
21.4
61.0
57.3
47.1
188.7
177.2
3.4
8.9
-.8
13.4
4.2
9.7
63.6
69.6
78.8
165.1
166.0
-2.5
.9
.7
-13.1
-46.8
-18.4
-37.8
65.7
67.5
120.8
176.0
-11.1
-45.5
1.3
9.3
-5.6
8.6
12.1
60.4
75.3
155.4
187.1
-6.3
-25.7
.3
49.0
4.7
10.0
-18.8
75.8
61.7
134.8
203.3
-11.2
-57.8
.6
13.5
-24.0
9.3
40.8
42.4
54.0
94.0
172.8
-27.8
-51.5
.5
48.3
21.3
25.4
4.1
62.4R
85.7
74.9*
100. lRr
—6.5
-18.9*r
.l
19.2
-39.7
-27.1
-22.3R
67.2R
75.7
171.5RR
211.6R
-12.0
-28.9R
,7
22.9
31.7
33.7
-31.6R
48.3
72.6
206.7
229.9
-4.4
-19.2
.4
60.7
6.9
23.8
-11.9
63.9
67.4
168.6
206.7
-2.3
-35.8
.0
93.3
20.0
9.7
-9.2
60.5
51.0
184.0
206.7
-6.9
-16.7
.9
49.5
36.7
-27.4
69.7
17
18
19
20
21
22
By borrowing sector
Household
Nonfinancial business
Farm
Nonfarm noncorporate
Corporate
State and local government
276.7
236.3
.5
49.4
186.5
63.5
207.7
121.9
1.8
19.4
100.7
54.5
168.4
-33.4
2.4
-24.5
-11.3
62.3
215.0
4.0
1.2
-39.4
42.1
59.4
247.8
23.0
1.9
-25.6
46.7
65.4
217.9
20.6
-.2
-37.3
58.2
73.5
266.5
-12.2
-1.9
-51.0
40.7
35.1
109.2R
—27.8RR
-2.7
-32.7R
7.5
71.7
251.LRR
50.8R
3.1
-31.4
79.R
69.1
324.3
30.6
4.4
-24.1
50.3
52.1
306.5
38.3
2.7
-14.3
49.8
68.8
255.2
96.7
3.8
29.7
63.2
72.2
10.2
4.9
-.1
13.1
-7.6
23.9
21.4
-2.9
12.3
-7.0
13.9
14.1
3.1
6.4
-9.8
24.2
17.3
2.3
5.2
-.6
47.7
60.5
.7
-9.0
-4.5
37.8
20.3
3.9
13.1
.5
-.6
22.2
-10.3
-12.1
-.4
50.3
75.6
1.6
-21.7
-5.3
39.3R
42.4
6.5
-.6
—9.0R
82.4
84.5
1.0
-1.6
-1.5
19.0
39.3
-6.3
-12.0
-2.0
7.6
43.8
6.1
-49.0
6.7
733.1
654.9
489.4
606.6
640.0
649.0
528.8
432.9r
758.5r
666.6
702.2
627.6
23 Foreign net borrowing in United States
24 Bonds
25 Bank loans n.e.c
26 Commercial paper
27 U.S. government and other loans
28 Total domestic plus foreign
Financial sectors
213.7
193.5
150.4
216.4
239.0
304.1
174.8
145.4r
131.5r
385.7
293.2
408.7
149.5
25.2
124.3
.0
167.4
17.1
150.3
-.1
145.7
9.2
136.6
.0
155.8
40.3
115.6
.0
157.2
80.6
76.6
.0
169.3
67.7
101.6
.0
131.8
33.6
98.4
-.1
165.8
32.2
133.5
.0
62.7
68.8
-6.1
.0
273.7
167.8
105.9
.0
126.4
53.4
73.0
.0
322.7
160.0
181.9
-19.2
34 Private
35 Corporate bonds
36 Mortgages
37 Bank loans n.e.c
38 Open market paper
39 Loans from Federal Home Loan Banks
64.2
37.3
.5
6.0
31.3
-11.0
26.1
40.8
.4
1.1
8.6
-24.7
4.6
56.8
.8
17.1
-32.0
-38.0
60.6
65.3
.0
-4.8
-.7
.8
81.8
70.8
3.8
-9.9
-6.2
23.3
134.8
81.2
.4
17.5
17.5
18.1
42.9
79.4
.0
-19.8
-6.5
-10.1
-20.3RR
54.6
.9
-21.2
-73.1
18.6
68.8Rr
55.7
2.7
-5.9
-17.3
33.5
112.0
97.3
6.2
-14.0
-9.7
32.3
166.8
75.7
5.5
1.5
75.5
8.6
86.0
81.8
5.4
8.6
4.5
-14.3
By borrowing sector
40 Government sponsored enterprises
41 Federally related mortgage pools
42 Private
43 Commercial banks
44 Bank holding companies
45 Funding corporations
46 Savings institutions
47 Credit unions
48 Life insurance companies
49 Finance companies
50 Mortgage companies
51 Real estate investment trusts (REITs)
52 Issuers of asset-backed securities (ABSs)
25.2
124.3
64.2
-1.4
6.2
13.8
-15.1
.0
.0
27.4
3.0
1.3
28.9
17.0
150.3
26.1
-.7
-27.7
12.5
-30.2
.0
.0
24.0
-4.0
1.0
51.1
9.1
136.6
4.6
-11.7
-2.5
-13.6
-44.5
.0
.0
18.6
5.7
1.6
51.0
40.2
115.6
60.6
8.8
2.3
1.6
-6.7
.0
.0
-3.6
.1
.1
58.0
80.6
76.6
81.8
5.6
8.1
-10.7
11.1
.2
.2
-5.0
4.0
3.3
64.9
67.7
101.6
134.8
12.1
6.6
-7.7
11.2
.0
.2
21.2
14.4
2.3
74.3
33.5
98.4
42.9
14.5
.8
-31.1
-14.4
.1
-.2
19.9
-6.4
-5.1
64.8
32.2
133.5
—20.3R
5.4
21.1
-51.9
7.9
.0
.1
-33.1
-10.4
-1.4R
41.9
68.8
-6.1R
68.8
10.1
1.3
8.2
17.7
.3
.6
-38.6
15.9
2.5
50.7R
167.8
105.9
112.0
6.2
-2.2
-13.2
18.4
.3
-.1
16.0
2.4
6.1
78.1
53.4
73.0
166.8
.8
12.2
14.0
.6
.1
.4
35.8
8.0
5.9
89.0
140.8
181.9
86.0
7.0
4.1
-22.2
-9.0
.1
.0
56.2
-5.9
6.0
49.7
29 Total net borrowing byfinancialsectors
30
31
32
33
By instrument
U.S. government-related
Government-sponsored enterprises securities
Mortgage pool securities
Loans from U.S. government
Flow of Funds
A41
1.57 FUNDS RAISED IN U.S. CREDIT MARKETS1—Continued
1992
Transaction category or sector
1989
1990
1991
1992
1994
1993
1993r
Q3
Q4
Ql
Q3r
Q2
Q4r
Ql
All sectors
53 Total net borrowing, all sectors
946.8
848.4
639.8
822.9
879.0
953.1
703.6
578.3r 889.9*
1,052.3
995.4
1,036.3
54
55
56
57
58
59
60
61
295.8
65.3
116.0
269.6
49.5
42.3
65.9
42.4
414.4
57.3
109.2
189.1
13.4
2.4
30.7
31.8
424.0
69.6
149.6
165.8
-13.1
-26.6
-44.0
-85.6
459.8
65.7
150.1
120.8
9.3
-8.1
13.1
12.2
413.3
60.4
206.6
159.2
49.0
-4.5
-5.1
.0
468.5
75.8
163.3
135.3
13.5
-2.5
39.9
59.3
372.0
42.4
155.6
93.9
48.3
-8.8
6.8
-6.6
395.3 410.9
62.4
67.2
215.9*r 173.8*
75.7 174.2*
19.2
22.9
-59.3
32.3
-121.9r
15.7
-9.1
-7.1*
450.9
48.3
254.4
212.9
60.7
-6.2
12.5
18.8
396.0
63.9
182.4
174.1
93.3
15.2
73.2
-2.6
537.8
60.5
176.7
189.4
49.5
51.3
-71.9
43.0
U.S. government securities . . .
Tax-exempt securities
Corporate and foreign bonds ..
Mortgages
Consumer credit
Bank loans n.e.c
Open market paper
Other loans
Funds raised through mutual funds and corporate equities
62 Total net share issues
63 Mutual funds
64 Corporate equities
65 Nonfinancial corporations
66 Financial corporations
67 Foreign shares purchased in United States
-59.6
22.2
210.6
284.0
423.7
297.7
300.3
296.0*
462.2*
491.7
445.1
320.8
38.5
-98.1
-124.2
8.8
17.2
67.9
-45.7
-63.0
9.9
7.4
150.5
60.1
18.3
11.2
30.7
206.7
77.3
27.0
19.6
30.6
310.8
112.9
22.9
25.1
64.9
235.2
62.5
12.0
15.7
34.8
217.7
82.6
14.0
21.1
47.5
240.9
55.1*
8.6*
14.5*
31.9
357.5
104.7*
24.8*
25.9*
54.0
337.6
154.1
28.7
26.7
98.6
307.2
137.8
29.5
33.2
75.1
217.5
103.3
2.0
30.0
71.3
1. Data in this table also appear in the Board's Z.l (780) quarterly statistical
release, tables F.2 through F.5. For ordering address, see inside front cover.
A42 Domestic Financial Statistics • August 1994
1.58 SUMMARY OF FINANCIAL TRANSACTIONS1
Billions of dollars except as noted; quarterly data at seasonally adjusted annual rates
1993
1992
Transaction category or sector
1989
1990
1991
1992
1994
1993
Q3
Q4
953.1
703.6
Ql
Q2
Q3
Q4*
Ql
NET LENDING IN CREDIT MARKETS2
1 Total net lending in credit markets
2
3
4
5
6
7
8
9
10
11
12
Private domestic nonfinancial sectors
Households
Nonfarm noncorporate business
Nonfinancial corporate business
State and local governments
U.S. government
Foreign
Financial sectors
Government sponsored enterprises
Federally related mortgage pools
Monetary authority
N
Commercial banking
14
U.S. commercial banks
15
Foreign banking offices
16
Bank holding companies
17
Banks in U.S. affiliated areas
18 Private nonbank finance
19
Thrift institutions
7.0
Insurance
21
Life insurance companies
22
Other insurance companies
23
Private pension funds
24
State and local government retirement funds
25
Finance n.e.c
26
Finance companies
27
Mortgage companies
7,8
Mutual funds
29
Closed-end funds
30
Money market funds
31
Real estate investment trusts (REITs)
32
Brokers and dealers
33
Asset-backed securities issuers (ABSs)
34
Bank personal trusts
639.8
822.9
879.0
578.3'
889.9* 1,052.3'
995.4 1,036.3
162.8 -16.1
122.6
140.1 -49.7
78.6
-.7
-1.7
-4.2
4.3
13.6
-5.3
29.6
33.5
31.1
33.7
10.5
-3.1
84.4
82.1
25.6
619.8
742.9
569.9
-4.1
16.4
14.2
150.3
136.6
124.3
8.1
-7.3
31.1
177.2
125.1
84.3
94.9
39.2
146.1
48.5
28.4
26.7
-2.8
-1.5
2.8
1.6
4.5
-1.9
270.0
353.7
452.9
-86.6 -153.3 -123.0
257.4
181.6
234.3
94.4
83.2
101.8
29.7
26.5
32.3
81.1
17.2
85.3
43.5
33.5
44.7
282.2
241.7
242.3
28.4 -12.1
32.0
11.4
6.1
-8.0
41.4
90.3
23.8
.0
15.2
6.3
80.9
67.1
30.1
-.7
-1.0
.5
34.9
49.0
96.3
27.7
49.9
49.0
10.4
22.4
14.8
65.3
37.0
-2.4
36.3
-5.7
-12.0
100.8
668.8
69.0
115.6
27.9
94.8
69.8
16.5
5.6
2.9
361.6
-59.5
177.9
82.4
12.7
37.3
45.5
243.2
1.7
.1
123.7
12.3
1.3
.4
40.2
55.5
8.0
-62.8 -105.4
-67.9 -135.7
-2.5
-2.0
46.5
12.3
-4.8 -14.1
-18.6 -26.7
128.2
78.1
832.2 1,006.9
90.2
73.0
76.6
101.6
36.2
15.7
143.2
148.0
150.5
123.5
-9.8
5.2
-.1
16.4
2.6
3.0
668.6
486.0
-13.3 -42.6
261.4
192.4
85.1
109.5
9.4
-2.8
40.2
99.9
33.3
79.2
306.9
449.7
-5.4
4.0
-.4
28.9
164.0
156.9
11.4
8.7
12.9
8.5
-.3
.6
57.1
180.3
63.6
72.0
3.1
-9.3
87.0 -79.8 r
66.6 —83.9*
-1.0
-3.7
36.9
-4.0*
-15.5
11.8
-13.3 -24.7
87.8
74.0*
542.1 608.9*
71.7
14.6
98.4 133.5
44.5
48.3
86.4
73.3
66.0 100.4
4.8 -12.5
-.6
-4.3
2.9
3.0
250.4 329.9*
-15.0 -33.3
161.6 257.0
103.7 122.1
8.3
8.9
8.4 118.0
41.2
8.0
103.8 106.2*
24.0 -34.0
-12.8 -50.3*
119.2 130.2
13.1
8.9
-26.1 -65.0
-.1
.2*
-90.2
79.5
41.4*
59.2
17.3 -4.7*
-82.4* -94.8*
-82.5* -110.7*
-2.2
-3.0
42.7*
10.6*
-7.5 -24.6
-28.5* -15.4'
93.4* 138.3'
907.4* 1,024.2'
145.1'
134.1
105.9
-6.1
28.2
32.6
131.9
153.4
147.0
142.0
-17.2
-.7
-.4
9.5
2.5
2.6
593.3* 6i3.<Y
10.3*
-5.2
261.6
172.9
117.1
108.0
8.6
10.6
91.9
11.1
44.0
43.2
425.7* 341.1'
8.1
-22.8
64.9* -1.9
168.4
193.4
11.0
13.0
11.5
51.5
1.0
.8
69.0
66.7
80.9*
49.6*
8.6* -7.0'
306.5
5.8
260.4
5.4
-4.4
-1.0
24.1
.0
26.4
1.3
-5.9 -41.7
112.8
207.2
788.3
658.7
66.7
77.9
181.9
73.0
51.5
39.5
201.1
169.6
212.7
108.7
50.2
-8.7
-5.1
8.6
2.1
2.3
177.8
407.9
-24.9
10.1
78.1
65.9
119.6
90.6
9.7
19.7
-60.1 -104.9
37.9
31.5
354.7
101.9
27.2
64.9
-14.2 -12.0
45.5
163.9
12.7
12.5
53.6 -46.3
.2
.7
13.4 -37.9
82.5
50.3
15.5
24.1
879.0
953.1
703.6
889.9* 1,052.3'
995.4 1,036.3
-8.5
5.1
946.8
848.4
RELATION OF LIABILITIES
TO FINANCIAL ASSETS
35 Netflowsthrough credit markets
Other financial sources
36 Official foreign exchange
37 Treasury currency and special drawing rights
certificates
38 Life insurance reserves
39 Pension fund reserves
40 Interbank claims
41 Deposits at financial institutions
42 Checkable deposits and currency
43 Small time and savings deposits
44 Large time deposits
45 Money market fund shares
46 Security repurchase agreements
47 Foreign deposits
48 Mutual fund shares
49 Corporate equities
50 Security credit
51 Trade debt
52 Taxes payable
53 Noncorporate proprietors' equity
54 Investment in bank personal trusts
55 Miscellaneous
56 Total financial sources
Floats not included in assets (-)
57 U.S. government checkable deposits
58 Other checkable deposits
59 Trade credit
60
61
62
63
64
Liabilities not identified as assets (-)
Treasury currency
Interbank claims
Security repurchase agreements
Taxes payable
Miscellaneous
65 Total identified to sectors as assets
946.8
848.4
639.8
822.9
24.8
2.0
-5.9
-1.6
.8
4.1
28.8
309.7
-16.5
284.8
6.1
100.4
13.9
90.1
77.8
-3.6
38.5
-98.1
15.6
59.4
2.0
-31.1
23.1
292.1
2.5
25.7
158.1
34.2
98.1
44.2
59.0
-65.7
70.3
-24.2
14.6
67.9
-45.7
3.5
32.1
-4.5
-35.5
21.5
98.2
.0
25.7
358.8
-3.7
48.2
75.8
16.7
-60.8
41.2
-16.5
-8.2
150.5
60.1
51.4
-2.2
-8.5
-12.5
29.8
169.9
-1.8
27.3
227.8
48.1
9.3
122.8
-60.8
-80.0
3.9
33.6
-10.2
206.7
77.3
4.2
54.9
7.9
-5.7
-7.5
195.7
.4
50.6
235.4
32.9
85.7
119.5
-79.8
-16.1
15.8
67.2
-20.9
310.8
112.9
61.9
53.4
3.7
-18.5
13.8
281.7
3.4
1.7
-4.0
.2
-7.7
.3
.4
41.5
26.3
53.6
39.5
291.7
267.0 332.9* 224.2*
79.8
50.0
26.2*
48.3*
174.1 -142.7
-.4
219.6
200.4
93.5
25.0
232.2
-83.6 -37.8 -155.9 -57.3
-52.9 -84.2
1.9 -17.5
-22.4 -32.9 -37.7
66.5
89.6 -67.1 180.3
17.6
43.0 -14.2 -13.9 -21.9
217.7 240.9
235.2
357.5
62.5
82.6
55.1* 104.7*
5.5
39.7
82.8
38.3
29.2*
54.0
33.0
43.0*
6.7
10.3
3.4*
9.3*
-27.5
10.5 -10.1* -20.3*
-55.4 -35.2 -27.7*
24.8*
202.6
211.8 190.4* 423.7*
.4
59.5
304.1'
14.8*
-14.6*
96.3
-73.0*
-57.3
-15.8
78.7
-43.5*
337.6
154.1*
77.2
57.6*
-4.2*
-8.4*
32.4*
177.8*
2.2
6.0
.7
.7
49.6
49.6
80.3 -65.8
42.4
156.3
33.7
138.3
124.4
78.0
-33.0 -24.5
8.7 -31.8
50.3
-1.7
-7.9
21.7
-4.2
-8.0
307.2
217.5
137.8
103.3
13.4
92.6
83.8
30.3
6.2
3.0
-35.2 -103.4
25.7
17.1
335.0
188.3
1,883.8 1,306.5 1,501.3 1,665.5 2,104.7 2,092.8 1,437.9 1,515.2* 2,398.9* 2,242.4* 2,262.3 1,686.2
8.4
-3.2
-1.9
3.3
2.5
2.5
-13.1
2.0
8.1
.7
1.6
18.5
-1.5
-3.8
17.7
4.4
-11.7
40.2
-3.6
2.3
1.2
.1
-1.8
-8.6*
6.2
-1.4
28.6*
-6.4
-5.6
10.7*
-5.8
-6.3
39.9
-5.9
-9.1
1.6
-.2
-4.4
32.4
2.3
-77.8
.2
1.6
-31.5
.5
-23.6
-.6
26.2
5.2
.4
-32.1
-.2
-4.9
31.1
6.9
-21.1
-.2
4.2
69.3
-1.3
-46.6
-.2
-7.8
43.5
24.1
1.2
-.1
-1.7
23.4
4.0
49.3
-.2
11.4
154.9*
-17.4*
-77.2*
-.2
-5.7
14.1*
21.2*
-31.0*
-.2
-16.5
66.7*
-.1*
-61.3*
-.2
27.7
41.4
-9.1
-16.8
-.1
-17.5
-24.9
-18.7
110.3
1,928.2 1,351.0 1,505.2 1,632.8 2,067.0 1,999.2 1,363.1 1,454.1* 2,367.2* 2,255.0* 2,191.5 1,650.7
1. Data in this table also appear in the Board's Z.l (780) quarterly statistical
release, tables F.6 and F.7. For ordering address, see inside front cover.
578.3*
2. Excludes corporate equities and mutual fund shares,
Flow of Funds
A43
1.59 SUMMARY OF CREDIT MARKET DEBT OUTSTANDING 1
Billions of dollars, end of period
1990
1991
1992
1994
1993
1992
Transaction category or sector
1993
Q4
Q3
Ql
Q2
Q3
Q4"
Ql
Nonfinancial sectors
1 Total credit market debt owed by
domestic nonfinancial sectors
11,747.2 11,826.0" 11,995.0" 12,142.4" 12,347.0
12,478.8
3,247.3
3,222.6
24.7
3,336.5
3,309.9
26.6
3,387.7
3,361.4
26.3
10,692.0
11,160.6
11,747.2
12,347.0
11,580.6
By lending sector and instrument
2 U.S. government
3 Treasury securities
4 Budget agency issues and mortgages . . .
2,498.1
2,465.8
32.4
2,776.4
2,757.8
18.6
3,080.3
3,061.6
18.8
3,336.5
3,309.9
26.6
2,998.9
2,980.7
18.1
3,080.3
3,061.6
18.8
3,140.2
3,120.6
19.6
3,201.2
3,180.6
20.6
5 Private
8,193.9
8,384.3
8,666.9
9,010.5
8,581.7
8,666.9
8,685.8"
8,793.8"
8,895.1"
9,010.5
9,091.1
6
7
8
9
10
11
12
13
14
15
16
By instrument
Tax-exempt obligations
Corporate bonds
Mortgages
Home mortgages
Multifamily residential
Commercial
Farm
Consumer credit
Bank loans n.e.c
Commercial paper
Other loans
1,062.1
1,008.2
3,715.4
2,580.6
305.5
750.8
78.4
813.0
747.8
116.9
730.6
1,131.6
1,086.9
3,880.4
2,746.6
303.0
751.7
79.1
799.9
701.0
98.5
685.9
1.197.3
1.154.4
4.001.6
2.922.7
291.9
706.5
80.4
809.2
695.6
107.1
701.6
1,257.8
1,229.8
4,163.6
3,115.8
286.0
681.0
80.7
858.3
700.3
117.8
683.0
1,186.4
1,140.9
3,979.4
2,880.8
298.9
719.4
80.3
784.5
686.2
108.2
696.1
1.197.3
1.154.4
4.001.6
2.922.7
291.9
706.5
80.4
809.2
695.6
107.1
701.6
1,210.0
1,175.9"
4,017.9
2,944.8"
290.7
702.0
80.4"
793.7
683.0
113.9
691.5"
1,225.7
1,194.8"
4,066.9"
3,003.8"
287.7"
694.8
80.6"
802.3
691.8
124.0
688.3"
1,241.8
1,212.9"
4,122.7"
3,065.4"
286.6
689.9"
80.7"
821.7
691.5"
123.2
681.2
1,257.8
1,229.8
4,163.6
3,115.8
286.0
681.0
80.7
858.3
700.3
117.8
683.0
1,270.0
1.242.5
4,200.7
3.158.6
284.3
676.8
81.0
849.9
707.5
125.1
695.3
17
18
19
20
21
22
By borrowing sector
Household
Nonfinancial business
Farm
Nonfarm noncorporate
Corporate
State and local government
3,594.8
3.728.5
134.9
1,219.0
2.374.6
870.5
3,762.7
3,688.7
134.8
1,192.3
2,361.6
932.8
3.978.0
3,696.7
136.0
1,154.5
2.406.1
992.2
4.231.8
3,721.0
137.9
1.128.9
2,454.3
1,057.7
3,900.1
3,698.6
137.6
1,165.1
2,395.8
983.1
3.978.0
3,696.7
136.0
1,154.5
2.406.1
992.2
3,981.2"
3,697.4"
133.1"
1,145.3
2,419.1"
1,007.2
4,054.5"
3,715.9"
136.3"
1.139.3
2,440.3"
1.023.4
4,143.4"
3,711.3"
138.3"
1,130.6"
2,442.4"
1,040.5
4.231.8
3,721.0
137.9
1.128.9
2,454.3
1,057.7
4,264.9
3,753.4
136.6
1,135.0
2.481.8
1.072.9
23 Foreign credit market debt held in
United States
285.1
298.9
313.8
361.6
312.9
313.8
324.8
336.3"
355.6
361.6
361.8
24
25
26
27
115.4
18.5
75.3
75.8
129.5
21.6
81.8
66.0
146.9
23.9
77.7
65.4
207.3
24.6
68.7
60.9
141.3
26.5
80.7
64.4
146.9
23.9
77.7
65.4
165.8
24.3
72.3
62.5
176.4
25.9
72.1
61.9"
197.5"
26.2
71.7
60.2"
207.3
24.6
68.7
60.9
218.3
26.2
56.5
60.9
10,977.1
11,459.5
12,061.0
12,708.5
11,893.5
12,061.0 12,150.8" 12,331.3" 12,498.0" 12,708.5
12,840.6
Bonds
Bank loans n.e.c
Commercial paper
U.S. government and other loans
28 Total credit market debt owed by nonfinancial
sectors, domestic and foreign
Financial sectors
29 Total credit market debt owed by
financial sectors
By instrument
30 U.S. government-related
31 Government-sponsored enterprises
securities
32 Mortgage pool securities
33 Loans from U.S. government
34 Private
35 Corporate bonds
36 Mortgages
37 Bank loans n.e.c
38 Open market paper
39 Loans from Federal Home Loan Banks
By borrowing sector
40 Government-sponsored enterprises
41 Federally related mortgage pools
42 Privatefinancialsectors
43 Commercial banks
44 Bank holding companies
45 Funding corporations
46 Savings institutions
47 Credit unions
48 Life insurance companies
49 Finance companies
50 Mortgage companies
51 Real estate investment trusts (REITs)
52 Issuers of asset-backed securities (ABSs)—
2,559.4
2,709.7
2,941.7
3,186.0
2,889.3
2,941.7
2,974.1"
3,010.1"
3,104.4"
3,186.0
3,284.4
1,418.4
1,564.2
1,720.0
1,877.1
1,683.5
1,720.0
1,755.8
1,774.5
1,842.2
1,877.1
1,952.1
563.7
1,388.4
.0
1,332.3
767.0
10.3
54.5
400.1
100.4
563.7
1,388.4
1,332.3
79.0
123.7
129.6
97.6
.3
.3
396.4
15.5
18.9
471.0
393.7
1,019.9
4.9
1,140.9
549.9
4.3
52.0
417.7
117.1
402.9
1.156.5
4.8
1.145.6
606.6
5.1
69.1
385.7
79.1
443.1
1,272.0
4.8
1,221.7
678.2
5.1
64.2
394.3
79.9
523.7
1,348.6
4.8
1,308.9
749.0
8.9
54.3
393.5
103.1
434.7
1,244.0
4.8
1,205.8
658.3
5.1
67.5
394.6
80.2
443.1
1,272.0
4.8
1,221.7
678.2
5.1
64.2
394.3
79.9
451.2
1,299.8
4.8
1,218.3"
691.8"
5.4
56.9
379.2
85.0
468.4
1,301.3
4.8
1,235.6"
705.8"
6.0
55.8
375.9
92.1
510.3
1,327.1
4.8
1,262.2"
730.1"
7.6
52.4
373.2
98.9
523.7
1,348.6
4.8
1,308.9
749.0
8.9
54.3
393.5
103.1
398.5
1,019.9
1,140.9
76.7
114.8
137.9
139.1
.0
.0
374.4
7.3
12.4
278.3
407.7
1.156.5
1.145.6
65.0
112.3
124.3
94.6
.0
.0
393.0
13.0
14.0
329.4
447.9
1,272.0
1,221.7
73.8
114.6
135.2
87.8
.0
.0
389.4
13.0
14.1
393.7
528.5
1,348.6
1,308.9
79.5
122.7
129.9
99.0
.2
.2
384.4
17.0
17.4
458.6
439.5
1,244.0
1,205.8
69.0
114.4
143.0
89.2
.0
.0
382.7
14.6
15.3
377.5
447.9
1,272.0
1,221.7
73.8
114.6
135.2
87.8
.0
.0
389.4
13.0
14.1
393.7
456.0
1,299.8
1,218.3"
73.1
119.9
127.6
90.3
.0
.0
379.1
10.4
13.7
404.2"
473.2
1,301.3
1,235.6"
76.6
120.2
129.7
93.4
.1
.2
369.8
14.4
14.4
416.9"
515.1
1,327.1
1,262.2"
77.9
119.7
126.4
96.8
.2
.1
373.9
15.0
15.9
436.4"
528.5
1,348.6
1,308.9
79.5
122.7
129.9
99.0
.2
.2
384.4
17.0
17.4
458.6
All sectors
53 Total credit market debt, domestic and foreign
54 U.S. government securities
55 Tax-exempt securities
56 Corporate and foreign bonds
57 Mortgages
58 Consumer credit
59 Bank loans n.e.c
60 Open market paper
61 Other loans
13,536.5
14,169.3
15,002.7
15,894.5
14,782.8
3,911.7
4,335.7
1,131.6
1,823.1
3,885.5
799.9
791.7
565.9
835.8
4,795.5
1,197.3
1,979.5
4,006.7
809.2
783.7
579.0
851.7
5,208.8
1,257.8
2,186.1
4,172.6
858.3
779.2
580.0
851.8
4,677.6
1.186.4
1,940.6
3.984.5
784.5
780.2
583.6
845.5
1,062.1
1,673.5
3,719.7
813.0
818.3
609.9
928.4
1. Data in this table also appear in the Board's Z.l (780) quarterly statistical
release, tables L.2 through L.4. For ordering address, see inside front cover.
r
15,002.7 15,124.9" 15,341.4 15,602.4" 15,894.5
4,795.5
1,197.3
1,979.5
4,006.7
809.2
783.7
579.0
851.7
4.891.2
1,210.0
2,033.5"
4.023.3
793.7
764.3
565.4 r
843.7
4,970.9
1,225.7
2,076.9"
4,072.9"
802.3
773.5
572.0
847.0"
,084.7
,241.8
,140.5"
,130.3"
821.7
770.1"
568.2
845.1"
5,208.8
1,257.8
2,186.1
4,172.6
858.3
779.2
580.0
851.8
A44
DomesticNonfinancialStatistics • August 1994
1.60 SUMMARY OF FINANCIAL ASSETS AND LIABILITIES1
Billions of dollars except as noted, end of period
1992
Transaction category or sector
1990
1991
1992
Q3
CREDIT MARKET DEBT OUTSTANDING
1993
1994
1993
Q4
Ql
Q2
Q3
Q4*
Ql
15,894.5
16,125.0
2
1 Total credit market assets
2 Private domestic nonfinancial sectors
3 Households
4 Nonfarm noncorporate business
5 Nonfinancial corporate business
6 State and local governments
7 U.S. government
8 Foreign
9 Financial sectors
10 Government-sponsored enterprises
11 Federally related mortgage pools
12 Monetary authority
13 Commercial banking
14
U.S. commercial banks
15
Foreign banking offices
16
Bank holding companies
17
Banks in U.S. affiliated areas
18 Private nonbank finance
19
Thrift institutions
20
Insurance
21
Life insurance companies
22
Other insurance companies
Private pension funds
23
24
State and local government retirement funds...
25
Finance n.e.c
26
Finance companies
27
Mortgage companies
28
Mutual funds
29
Closed-end funds
30
Money market funds
31
Real estate investment trusts (REITs)
32
Brokers and dealers
33
Asset-backed securities issuers (ABSs)
34
Bank personal trusts
13,536.5
14,169.3 15,002.7
15,894.5
14,782.8
15,002.7 15,124.9" 15,341.4 R 15,602.4 R
2,246.8 2,205.8 2,288.3 2,251.9 2,209.1 2,288.3 2,266.3rr
1,454.6 1,380.0 1,434.2 1,392.7 1,369.4 1,434.2 l,419.8
54.9
50.7
45.8
48.1
48.3
48.3
47.0
175.8
180.1
216.4
228.8
199.5
216.4
208.lr
595.1
561.5
589.4
584.6
592.1
589.4
591.5
216.4
247.0
235.0
239.2
239.1
235.0
229.2
897.5
936.2 1,031.6 1,151.4 1,015.5 1,031.6 1,041 . R
10,153.1 10,780.3 11,447.8 12,274.8 11,319.0 11,447.8 ll,587.7r
371.8
397.7
466.7
446.3
551.0
466.7
464.1
1,019.9 1,156.5 1,272.0 1,348.6 1,244.0 1,272.0 1,299.8
241.4
272.5
300.4
336.7
285.2
300.4
303.6
2,772.5 2,856.8 2,951.6 3,094.8 2,928.2 2,951.6 2,960.9
2,466.7 2,506.0 2,575.7 2,726.2 2,560.0 2,575.7 2,594.6
270.8
319.2
335.8
328.9
326.0
335.8
326.7
13.4
17.4
11.9
17.5
17.5
17.5
16.4
21.6
19.7
22.5
25.1
21.8
22.5
23.3
5,747.4 6,096.7 6,457.1 6,943.7 6,415.3 6,457.1 6,559.2*
1,324.6 1,197.3 1,140.9 1,127.7 1,144.9 1,140.9 1,130.0
2,473.7 2,708.0 2,874.9 3,067.3 2,854.5 2,874.9 2,943.9
1,116.5 1,199.6 1,282.0 1,391.5 1,264.7 1,282.0 1,317.3
344.0
376.3
398.4
386.9
389.0
389.0
391.2
607.4
692.7
728.2
719.0
759.2
719.0
748.5
405.9
439.4
474.6
484.9
518.2
484.9
486.9
1,949.1 2,191.5 2,441.2 2,748.7 2,415.9 2,441.2 2,485.3r
497.0
484.9
486.6
481.3
477.8
486.6
473.7 r
14.6
25.9
26.1
25.7
29.3
26.1
13.5
360.2
450.5
574.2
550.2
738.2
574.2
611.4
52.4
37.1
64.6
76.0
61.3
64.6
66.9
372.7
402.7
404.1
408.2
417.0
404.1
404.5
7.7
6.8
7.4
7.4
8.6
7.4
8.1
177.9
226.9
267.1
289.6
324.2
267.1
287.0r
318.1
269.1
379.9
443.5
365.1
379.9
390.2r
212.9
223.3
231.2
234.3
226.9
231.2
230.0
2,221.9r
l,375.4
46.3
214.9*
591.4
223.0*
i,065.0*
ll,825.4r
496.7
1,301.3
318.2
3,003.2
2,633.8
327.1
18.4
23.9
6,706.0*
1,129.8
2,992.3
1,349.5
393.8
751.3
497.7
2,584.0r
473.5 r
29.7
659.9
70.1
403.9
8.3
303.6
402.6rr
232.2
2,208.2rr
l,358.4
45.6
220.9r
583.4r
218.6
l,099.6r
12,075.9 R
532.0*
1,327.1
324.2
3,040.2
2,674.7
322.3
18.6
24.5
6,852.5r
1,134.0*
3,057.5
1,378.6
396.0
774.3
508.7
2,661.0*
472.0
29.2*
703.6
72.8
400.6
8.6
320.9
422.9*
230.4*
2,251.9 2,312.1
1,392.7 1,450.7
44.4
45.8
228.8
226.6
584.6
590.4
216.4
206.3
1,151.4 1,179.5
12,274.8 12,427.1
551.0
570.5
1,348.6 1,388.4
336.7
341.5
3,094.8 3,125.8
2,726.2 2,748.3
326.0
332.3
17.4
19.6
25.1
25.6
6,943.7 7,000.9
1,127.7 1,127.5
3,067.3 3,086.9
1,391.5 1,426.5
398.4
403.4
759.2
733.0
518.2
524.0
2,748.7 2,786.5
481.3
492.8
25.7
22.7
738.2
754.3
76.0
79.1
417.0
422.2
8.6
8.8
324.2
314.7
443.5
456.0
234.3
235.8
RELATION OF LIABILITIES
TO FINANCIAL ASSETS
35 Total credit market debt
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
Other liabilities
Official foreign exchange
Treasury currency and special drawing rights
certificates
Life insurance reserves
Pension fund reserves
Interbank claims
Deposits at financial institutions
Checkable deposits and currency
Small time and savings deposits
Large time deposits
Money market fund shares
Security repurchase agreements
Foreign deposits
Mutual fund shares
Security credit
Trade debt
Taxes payable
Investment in bank personal trusts
Miscellaneous
54 Total liabilities
13,536.5
14,169.3 15,002.7
15,894.5
14,782.8
15,002.7 15,124.9* 15,341.4 R 15,602.4* 15,894.5
61.3
55.4
51.8
53.4
55.4
51.8
26.3
380.0
3,400.3
64.0
4,836.8
932.8
2,336.3
537.7
498.4
372.3
159.4
602.1
137.4
936.4
77.4
509.9
2,732.4
26.3
405.7
4,056.5
65.2
4,885.2
1,008.5
2,353.0
476.9
539.6
355.8
151.3
813.9
188.9
926.7
68.9
596.7
2,884.3
24.5
433.0
4,357.8
113.1
4,892.1
1,131.0
2,292.2
397.2
543.6
389.4
138.8
1,042.1
217.3
978.1
76.8
619.1
3,053.7
25.0
483.5
4,774.7
146.3
4,977.9
1,250.5
2,212.4
381.1
559.4
456.6
117.9
1,429.3
279.3
1,032.1
80.5
643.9
3,273.7
26.5
426.4
4,250.0
100.7
4,909.3
1,072.0
2,303.7
418.4
552.9
417.6
144.6
965.6
214.5
965.1
74.6
610.9
3,026.7
24.5
433.0
4,357.8
113.1
4,892.1
1,131.0
2,292.2
397.2
543.6
389.4
138.8
1,042.1
217.3
978.1
76.8
619.1
3,053.7
27,300.7
29,143.0 30,862.1 33,093.9 30,408.2
54.5
53.9
24.6
24.7
446.4
456.2
4,494.2r 4,557.5Rr
M.R
118.L
4,887.8 4,929.3r
1,092.2 1,169.1
2,262.0 2,242.2
398.3
389.9
556.6
549.8
443.5
448.4 r
135.3
129.8
1,134.6 1,225.8
225.1r
234.7r
976.4
985.4
79.9*
77.9"
622.5r
629. l r
3,069.9" 3,160.3r
55.6
24.8
471.1
4,706.0*
137.6*
4,924.2*
1,182.6
2,223.0*
379.7
547.9
470.9
120.2*
1,342.4
254.5
1,007.5*
79.3*
632.8*
3,216.1*
16,125.0
53.4
56.4
25.0
483.5
4,774.7
146.3
4,977.9
1,250.5
2,212.4
381.1
559.4
456.6
117.9
1,429.3
279.3
1,032.1
80.5
643.9
3,273.7
25.1
495.9
4,685.2
177.9
4,983.1
1,225.0
2,215.2
374.2
582.2
470.6
115.9
1,503.1
280.2
1,030.4
83.6
634.4
3,365.8
30,862.1 31,251.8 R 31,794.3 R 32,454.4* 33,093.9 33,446.2
Financial assets not included in liabilities (+)
55 Gold and special drawing rights
56 Corporate equities
57 Household equity in noncorporate business
22.0
3,543.7
2,440.6
22.3
4,869.4
2,344.6
19.6
5,540.6
2,274.5
20.1
6,120.7
2,228.3
23.2
4,995.4
2,320.3
19.6
19.8
20.0
20.3
5,540.6 5,721.3r 5,741.9 6,006.6
2,274.5 2,259.8 2,261.0* 2,252.6*
20.1
6,120.7
2,228.3
20.4
5,961.9
2,179.3
Floats not included in assets (-)
58 U.S. government checkable deposits
59 Other checkable deposits
60 Trade credit
15.0
28.9
-146.0
3.8
30.9
-144.1
6.8
32.5
-128.5
5.6
28.7
-109.2
4.0
23.3
-149.6
6.8
32.5
-128.5
3.4
27.2
-135.7 r
3.5
29.6
-140.4 r
2.2
21.7
-139.1*
5.6
28.7
-109.2
.3
21.8
-114.1
-4.1
-32.0
-17.7
17.8
-213.4
-4.8
-4.2
-12.5
15.5
-254.6
-4.9
-9.3
18.6
22.4
-254.9
-5.1
-4.7
88.0
29.6
-377.7
-4.9
-5.0
33.1
18.2
-273.2
-4.9
-5.0
-9.3
-5.6
18.6
72. R
22.4
u.r
-254.9 -309.5 r
-5.0
-5.7 r
79.3r
20. l
-301.5 r
-5.1
-7.8
100.5*
19.0*
-342.3*
-5.1
-4.7
88.0
29.6
-377.7
-5.2
-7.4
96.7
21.4
-317.8
61
62
63
64
65
Liabilities not identified as assets (-)
Treasury currency
Interbank claims
Security repurchase agreements
Taxes payable
Miscellaneous
66 Total identified to sectors as assets
33,658.6 36,749.2
39,014.1 41,807.8 38,101.2 39,014.1 39,594.7' 40,137.4 R 41,084.7* 41,807.8 41,912.2
1. Data in this table also appear in the Board's Z.l (780) quarterly statistical
release, tables L.6 and L.7. For ordering address, see inside front cover.
2. Excludes corporate equities and mutual fund shares,
Selected Measures
2.10 NONFINANCIAL BUSINESS ACTIVITY
A45
Selected Measures
Monthly data seasonally adjusted, and indexes 1987=100, except as noted
1994
1993
1993
1992
Measure
Oct.
Sept.
1 Industrial production1
111.3
111.9
112.8
114.0
114.6
115.0
115.7
103.2
105.3
105.7
110.2
111.2
112.1
112.8
114.2
117.2
111.6
125.3
105.1
114.6
117.4
104.3
113.9
113.0
115.4
110.1
123.1
105.4
115.5
113.6
113.8
109.2
120.4
103.5
111.9
110.6
113.1
108.5
119.8
103.0
112.2
111.7
112.1
112.9
114.0
115.4
115.6
Industry groupings
8 Manufacturing
103.7
106.8
11 Nonagricultural employment, total4
12 Goods-producing, total
13
Manufacturing, total
14
Manufacturing, production workers
15 Service-producing
16 Personal income, total
17 Wages and salary disbursements
18
Manufacturing
19 Disposable personal income3
20 Retail sales6
Prices7
21 Consumer (1982-84=100)
22 Producer finished goods (1982=100)....
Mar.r
110.9
111.2
10 Construction contracts3
Feb. r
106.5
108.9
96.8
105.4
(percent)2
Jan.r
104.1
Market groupings
2 Products, total
3 Final, total
4
Consumer goods
5
Equipment
6 Intermediate
7 Materials
9 Capacity utilization, manufacturing
Dec.
102.8
108.0
105.7
99.0
107.7
112.7
108.7
118.5
102.6
114.6
109.7
121.8
116.2
110.9
123.9
105.7
116.0
111.8
116.2
125.5
105.9
117.5
116.1
117.0
77.8
78.6
81.5
82.3
82.2
82.4
82.8
89.7
97.7
100.8r
101.0
103.0
105.0
102.0
103.0
107.0
110.0
106.2
96.6
97.1
96.0
109.4
127.6
124.5
113.7
108.1
93.1
93.7
93.7
108.8r
141.7
136.2
117.8
143.1
135.2
94. lrr
94.4r
94.6
113.51
143.1
138.0
119.1
144.4
136.0
109.07r
94.2r
94.4r
94.7
113.71
144.1
138.8
119.1
145.4
138.7
109.2rr
94.4r
94.5r
94.8
114.01
145.0
139.2
119.9
146.3
139.6
109.5rr
94.4
94.4r
94 r
114.3
145.9
139.9
120.7
147.3
141.1
109.6
94.5
94.6
95.1
114.4
144.7
141.2
109.8
94.5
94.6
95.3
114.6
147.3
141.5
128.6
121.1
106.4
94.9
95.8
94.5
110.5
135.3
131.5
117.8
136.8
126.9
145.5
139.3
148.5
141.9
110.1
94.8
94.6
95.4
115.0
148.1
142.1
121.9
149.3
144.5
136.2
121.7
140.3
123.2
144.5
124.7
145.1
123.8
145.7
124.6
145.8
124.5
145.8
124.1
146.2
124.5
146.7
124.8
147.2
125.0
112.8
1. Data in this table also appear in the Board's G.17 (419) monthly statistical
release. For the ordering address, see the inside front cover. The latest historical
revision of the industrial production index and the capacity utilization rates was
released in February 1994. See "Industrial Production and Capacity Utilization
since 1990: A Revision," Federal Reserve Bulletin, vol. 80 (March 1994), pp.
220-26. For a detailed description of the industrial production index, see
"Industrial Production: 1989 Developments and Historical Revision," Federal
Reserve Bulletin, vol. 76 (April 1990), pp. 187-204.
2. Ratio of index of production to index of capacity. Based on data from the
Federal Reserve, DRI McGraw-Hill, U.S. Department of Commerce, and other
sources.
3. Index of dollar value of total construction contracts, including residential,
nonresidential, and heavy engineering, from McGraw-Hill Information Systems
Company, F.W. Dodge Division.
4. Based on data from U.S. Department of Labor, Employment and Earnings.
Series covers employees only, excluding personnel in the armed forces.
120.8
121.8
5. Based on data from U.S. Department of Commerce, Survey of Current
Business.
6. Based on data from U.S. Department of Commerce, Survey of Current
Business.
7. Based on data not seasonally adjusted. Seasonally adjusted data for changes
in the price indexes can be obtained from the U.S. Department of Labor, Bureau
of Labor Statistics, Monthly Labor Review.
NOTE. Basic data (not indexes) for series mentioned in notes 4, 5,and 6, and
indexes for series mentioned in notes 3 and 7 can also be found in the Survey of
Current Business.
Figures for industrial production for the latest month are preliminary, and many
figures for the three months preceding the latest month have been revised. See
"Recent Developments in Industrial Capacity and Utilization," Federal Reserve
Bulletin, vol. 76 (June 1990), pp. 411-35. See also "Industrial Production Capacity
and Capacity Utilization since 1987," Federal Reserve Bulletin, vol. 79, (June
1993), pp. 590-605.
2.11 LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT
Thousands of persons; monthly data seasonally adjusted except as noted
1993r
Category
1991
1992
1994
1993
Oct.
Nov.
Dec
Jan.r
Feb.r
Mar.r
Apr,
HOUSEHOLD SURVEY DATA 1
1 Civilian labor force2
Employment
2 Nonagricultural industries3
3 Agriculture
Unemployment
4 Number
5 Rate (percent of civilian labor force)
125,303
126,982
128,040
128,580
128,662
128,898
130,667
130,776
130,580
130,747
114,644
3,233
114,391
3,207
116,232
3,074
116,920
3,021
117,218
3,114
117,565
3,096
118,639
3,331
118,867
3,391
118,611
3,426
118,880
3,459
8,426
6.7
9,384
7.4
8,734
6.8
8,639
6.7
8,330
6.5
8,237
6.4
8,696
6.7
8,518
6.5
8,543
6.5
8,408
6.4
108,256
108,519
110,171
111,112
111,366
111,610
111,711
111,919
112,298
112,656
17,940
605
4,700
5,798
25,787
6,748
30,661
18,873
17,944
604
4,733
5,800
25,819
6,763
30,816
18,887
17,942
618
4,738
5,792
25,907
6,769
30,926
18,918
17,968
616
4,744
5,793
25,914
6,771
31,004
18,901
17,970
612
4,745
5,803
25,968
6,776
31,129
18,916
17,980
609
4,806
5,816
26,039
6,781
31,326
18,941
17,992
606
4,893
5,758
ESTABLISHMENT SURVEY DATA
6 Nonagricultural payroll employment4 .
7 Manufacturing
8 Mining
9 Contract construction
10 Transportation and public utilities
11 Trade
12 Finance
13 Service
14 Government
18,455
689
4,650
5,762
25,365
6,646
28,336
18,402
18,192
631
4,471
5,709
25,391
6,571
29,053
18,653
17,804
599
4,571
5,710
25,849
6,605
30,193
18,841
1. Beginning January 1994, reflects redesign of current population survey and
population controls from the 1990 census.
2. Persons sixteen years of age and older, including Resident Armed Forces.
Monthly figures are based on sample data collected during the calendar week that
contains the twelfth day; annual data are averages of monthly figures. By
definition, seasonality does not exist in population figures.
3. Includes self-employed, unpaid family, and domestic service workers.
26,160
6,790
31,485
18,972
4. Includes all full- and part-time employees who worked during, or received
pay for, the pay period that includes the twelfth day of the month; excludes
proprietors, self-employed persons, household and unpaid family workers, and
members of the armed forces. Data are adjusted to the March 1992 benchmark,
and only seasonally adjusted data are available at this time.
SOURCE. Based on data from U.S. Department of Labor, Employment and
Earnings.
A46 Domestic Nonfinancial Statistics • August 1994
2.12 OUTPUT, CAPACITY, AND CAPACITY UTILIZATION1
Seasonally adjusted
1993
Q2
Q3
1994
Q4
Ql r
Output (1987=100)
1993
Q2
Q3
1994
Q4
Q1
Capacity (percent of 1987 output)
1993
Q2
Q3
1994
Q4
Ql 1
Capacity utilization rate (percent)2
1 Total industry
110.3
111.1
112.9
115.1
135.9
136.5
137.2
138.0
81.2
81.4
82.3
83.4
2 Manufacturing
111.2
111.8
114.1
116.2
138.4
139.2
140.0
140.9
80.3
80.3
81.5
82.5
Primary processing 3 ..
Advanced processing
107.0
113.2
107.7
113.8
109.9
116.1
110.7
118.9
127.9
143.4
128.3
144.4
128.6
145.4
129.0
146.6
83.6
78.9
83.9
78.8
85.5
79.9
85.8
81.1
5
6
7
8
9
10
11
12
13
Durable goods
Lumber and products
Primary metals
Iron and steel
Nonferrous
Nonelectrical machinery
Electrical machinery
Motor vehicles and parts
Aerospace and miscellaneous
transportation equipment
113.2
98.0
105.2
109.7
99.0
141.7
125.9
118.1
114.2
100.8
106.7
112.3
98.9
147.2
129.7
112.0
118.1
104.9
109.6
115.6
101.4
152.7
132.6
131.7
121.0
103.8
109.7
114.9
102.6
158.6
136.3
142.7
144.5
114.8
123.3
127.4
117.6
173.1
153.8
153.4
145.4
115.0
123.0
126.9
117.6
175.7
155.7
154.8
146.3
115.2
122.6
126.3
117.6
178.2
157.7
156.1
147.6
115.4
122.4
126.0
117.5
181.7
160.3
157.8
78.4
85.4
85.3
86.1
84.1
81.8
81.9
76.9
78.5
87.6
86.8
88.6
84.1
83.8
83.2
72.3
80.7
91.1
89.4
91.5
86.2
85.7
84.1
84.4
82.0
89.9
89.6
91.2
87.3
87.3
85.0
90.5
90.3
87.4
85.2
82.5
133.7
133.2
132.8
132.2
67.6
65.6
64.2
62.4
14
15
16
17
18
19
Nondurable goods
Textile mill products
Paper and products
Chemicals and products
Plastics materials
Petroleum products
108.7
108.4
113.2
117.7
112.8
104.0
108.9
108.0
111.7
118.6
111.5
104.0
109.2
107.7
114.2
118.6
114.4
107.7
110.4
108.8
114.4
120.2
117.6
104.5
131.0
118.8
124.3
145.1
130.1
115.8
131.6
119.4
124.8
145.9
131.1
115.7
132.1
119.9
125.3
146.8
132.0
115.6
132.7
120.5
125.8
147.7
133.0
115.4
83.0
91.3
91.1
81.2
86.7
89.8
82.8
90.5
89.6
81.2
85.1
89.9
82.6
89.8
91.2
80.8
86.6
93.2
83.2
90.3
90.9
81.4
88.4
90.6
97.5
114.1
114.8
96.8
117.5
118.0
97.3
115.6
114.8
98.4
119.9
118.2
111.4
133.6
130.8
111.1
134.0
131.2
110.8
134.3
131.7
110.6
134.7
132.2
87.5
85.4
87.7
87.1
87.8
89.9
87.8
86.1
87.2
89.0
89.0
89.4
1973
1975
Previous cycle5
Latest cycle6
1993
1993
High
Low
High
Low
May
Dec.
Apr/
Mayp
3
4
20 Mining
21 Utilities
22 Electric
Low
High
1994
Jan.
Feb/
Mar.r
Capacity utilization rate (percent)2
1 Total industry
89.2
72.6
87.3
71.8
84.8
78.1
81.0
82.9
83.2r
83.3
83.7
83.6
83.5
2 Manufacturing
88.9
70.8
87.3
70.0
85.1
76.7
80.2
82.3
82.2
82.4
82.8
82.8
82.8
92.2
87.5
68.9
72.0
89.7
86.3
66.8
71.4
89.1
83.3
78.0
76.0
83.5
78.8
86.4
80.6
80.7
ss^
85.3
81.2
86.2
81.4
86.4
81.3
86.6
81.2
81.9
91.2rr
90.3
91.9*
87.9
86
82.0
89.1
87.9
88.5
86.9
87.4
84.9
92.6
82.1
89.4
90.7
93.1
87.1
87.8
85.6
88.3
82.2
89.9
91.6
94.2
87.9
88.4
86.2
86.6
82.1
90.5
92.1
94.7
88.4
89.4
86.1
82.9
3
4
Primary processing3
Advanced processing
5
6
7
8
9
10
11
12
13
Durable goods
Lumber and products
Primary metals
Iron and steel
Nonferrous
Nonelectrical machinery
Electrical machinery
Motor vehicles and parts
Aerospace and miscellaneous
transportation equipment.
88.8
90.1
100.6
105.8
92.9
96.4
87.8
93.4
68.5
62.2
66.2
66.6
61.3
74.5
63.8
51.1
86.9
87.6
102.4
110.4
90.5
92.1
89.4
93.0
65.0
60.9
46.8
38.3
62.2
64.9
71.1
44.5
83.9
93.3
92.9
95.7
88.9
83.7
84.9
84.5
73.8
76.2
74.4
72.2
75.8
71.4
77.3
57.3
78.3
85.5
85.1
85.6
84.3
81.8
81.7
77.3
81.9
91.3
92.2
94.5
88.9
87.0
84.8
88.5
90.5r
77.0
66.6
81.1
66.9
88.3
78.5
67.9
63.7
63.
62.0
62.3
62.2
62.2
14
15
16
17
18
19
Nondurable goods
Textile mill products
Paper and products
Chemicals and products
Plastics materials
Petroleum products
87.9
92.0
96.9
87.9
102.0
96.7
71.8
60.4
69.0
69.9
50.6
81.1
87.0
91.7
94.2
85.1
90.9
89.5
76.9
73.8
82.0
70.1
63.4
68.2
86.8
92.1
94.9
85.9
97.0
88.5
80.4
78.5
86.3
79.4
75.3
84.5
82.8
91.5
90.2
81.1
86.2
89.5
82.9
89.4
92.1
81.2
90.3
92.7
82.7
89.6r
90.4r
81.(f
87.3
90.8r
83.0
90.2
91.3
81.2
88.2
90.6
83.8
91.1
91.1
81.9
89.8
90.4
83.6
92.4
90.1
81.1
83.7
92.1
90.2
81.4
93.4
93.6
94.4
95.6
99.0
88.4
82.5
82.7
96.6
88.3
88.3
80.6
76.2
78.7
87.0
92.6
94.8
86.8
83.1
86.3
87.2
84.1
87.3
87.5
86.2
87.6
87.6rr
90.6
90.2
89.3
89.0
89.3
89.9
87.5
88.7
89.6
87.0
88.3
90.0
86.6
88.1
20 Mining
21 Utilities
22 Electric
1. Data in this table also appear in the Board's G.17 (419) monthly statistical
release. For the ordering address, see the inside front cover. The latest historical
revision of the industrial production index and the capacity utilization rates was
released in February 1994. See "Industrial Production and Capacity Utilization
since 1990: A Revision," Federal Reserve Bulletin, vol. 80 (March 1994), pp.
220-26. For a detailed description of the industrial production index, see
"Industrial Production: 1989 Developments and Historical Revision," Federal
Reserve Bulletin, vol. 76, (April 1990), pp. 187-204.
2. Capacity utilization is calculated as the ratio of the Federal Reserve's
seasonally adjusted index of industrial production to the corresponding index of
capacity.
.r
84.7
(f
3. Primary processing includes textiles; lumber; paper; industrial chemicals;
petroleum refining; rubber and plastics; stone, clay, and glass; and primary and
fabricated metals.
4. Advanced processing includes food, tobacco, apparel, furniture, printing,
chemical products such as drugs and toiletries, leather and products, machinery,
transportation equipment, instruments, miscellaneous manufacturing, and ordnance.
5. Monthly highs, 1978 through 1980; monthly lows, 1982.
6. Monthly highs, 1988-89; monthly lows, 1990-91.
Selected Measures
2.13 INDUSTRIAL PRODUCTION
A47
Indexes and Gross Value1
Monthly data seasonally adjusted
Group
1987
proportion
1994
1993
1993
avg.
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
Jan.r
Feb.r
Mar.r
Apr.r
May"
Index (1987 = 100)
MAJOR MARKETS
100.0
110.9
110.0
110.4
110.9
111.1
111.3
111.9
112.8
114.0
114.6
115.0
115.7
115.9
116.1
2 Products
3 Final products
4
Consumer goods, total
5
Durable consumer goods
6
Automotive products
7
Autos and trucks
8
Autos, consumer
9
Trucks, consumer
10
Auto parts and allied goods..
11
Other
12
Appliances, A/C, and TV
13
Carpeting and furniture
14
Miscellaneous home goods ..
15
Nondurable consumer goods
16
Foods and tobacco
17
Clothing
18
Chemical products
19
Paper products
20
Energy
21
Fuels
22
Residential utilities
59.5
44.8
26.5
5.8
2.7
1.7
1.1
.6
1.0
3.1
.8
.9
1.4
20.7
9.1
2.6
3.6
2.6
2.7
.8
2.0
110.2
112.7
108.7
110.5
111.6
112.2
86.1
157.3
110.6
109.5
122.9
102.2
106.7
108.2
106.1
94.9
122.5
103.2
113.7
106.6
116.5
109.3
111.8
107.8
109.0
110.4
110.1
86.5
150.9
110.8
107.8
116.6
101.6
106.7
107.4
105.9
95.8
122.2
103.7
107.6
104.9
108.6
109.6
112.1
108.1
107.2
106.5
105.0
83.5
142.3
109.1
107.7
115.5
103.3
106.1
108.3
106.2
96.0
123.0
104.7
111.1
104.7
113.6
110.4
112.8
108.9
108.2
104.3
100.3
78.2
138.6
111.0
111.6
130.6
103.8
105.8
109.1
107.0
95.2
123.9
103.7
114.8
104.0
119.0
110.4
112.7
108.6
107.3
103.9
99.2
71.8
146.7
111.8
110.2
124.9
103.2
106.4
109.0
107.0
94.3
123.7
103.1
115.8
103.8
120.4
110.6
113.1
108.5
108.7
106.7
104.1
75.4
153.9
111.1
110.4
126.4
102.4
106.4
108.4
105.9
93.3
124.1
103.2
115.3
108.0
118.2
111.2
113.8
109.2
112.7
113.8
114.9
85.2
166.4
111.9
111.8
130.4
104.1
106.3
108.2
105.9
93.3
122.6
104.0
114.6
111.3
115.9
112.1
114.6
109.7
115.8
120.2
124.9
95.4
176.0
112.3
112.0
130.7
102.5
107.5
107.9
105.2
94.3
122.3
103.3
115.2
110.6
117.0
113.0
115.4
110.1
118.2
124.9
131.5
98.8
188.0
113.9
112.2
130.5
102.8
108.0
107.9
105.8
95.1
122.0
102.6
113.1
108.6
114.9
113.6
116.2
110.9
119.0
127.7
134.6
102.0
191.0
116.3
111.3
123.7
104.0
109.1
108.6
106.1
93.8
121.6
102.6
119.7
105.1
125.4
114.2
117.2
111.6
120.9
131.7
141.0
106.7
200.4
116.2
111.5
123.4
105.5
108.6
109.0
106.9
94.4
123.3
102.3
117.1
104.3
122.1
114.6
117.4
111.8
118.2
125.3
131.1
101.0
183.3
115.4
112.1
125.7
104.5
109.3
110.0
108.7
95.7
125.3
102.5
114.5
105.3
118.1
114.8
117.6
111.8
118.0
123.7
128.6
98.3
181.2
115.4
113.0
128.0
105.9
109.2
110.0
108.8
96.4
123.5
103.4
115.0
107.8
117.8
115.0
117.6
111.2
115.5
119.1
121.2
92.3
171.3
115.6
112.3
124.5
107.0
108.9
110.0
108.8
96.5
123.7
103.8
114.7
108.1
117.3
23
24
25
26
27
28
29
30
31
32
33
Equipment
Business equipment
Information processing and related .
Office and computing
Industrial
Transit
Autos and trucks
Other
Defense and space equipment
Oil and gas well drilling
Manufactured homes
18.3
13.2
5.5
1.9
3.9
2.0
1.0
1.8
4.4
.6
.2
118.5
134.6
155.8
223.1
112.2
136.7
134.5
115.6
74.8
82.5
118.9
117.7
133.5
153.5
215.6
111.8
138.2
133.1
113.2
75.6
78.2
110.7
118.0
133.9
155.6
221.4
112.4
133.0
127.2
114.8
74.9
81.2
111.6
118.5
134.6
158.1
226.5
113.6
127.5
118.9
116.2
74.6
83.5
115.8
118.6
134.8
158.2
230.6
113.3
126.2
119.6
119.1
74.0
87.0
115.5
119.8
136.3
160.6
234.8
113.2
129.8
126.5
119.1
73.7
89.7
120.7
120.4
137.7
162.0
241.8
112.5
136.1
139.6
119.4
72.7
86.5
123.4
121.8
139.7
164.5
248.6
113.0
141.5
150.5
119.3
72.5
82.9
130.4
123.1
141.8
167.2
256.1
114.8
142.8
154.9
120.8
71.5
82.3
141.1
123.9
142.9
170.1
261.5
114.0
145.2
161.0
119.4
71.0
82.4
145.3
125.3
145.0
173.5
269.5
114.6
147.5
166.7
120.7
69.9
87.4
139.7
125.5
145.3
175.0
271.2
116.2
141.2
156.1
121.5
69.9
88.6
143.6
126.0
146.1
176.2
276.6
117.4
139.7
153.7
122.4
69.8
89.6
136.2
126.9
147.4
180.3
285.3
118.0
135.2
145.9
123.5
69.6
89.1
34
35
36
Intermediate products, total
Construction supplies
Business supplies
14.7
5.9
8.8
102.6
96.8
106.5
101.7
95.9
105.5
101.8
95.3
106.1
102.9
96.4
107.3
103.3
97.3
107.2
103.0
97.8
106.4
103.5
98.6
106.7
104.3
99.5
107.5
105.4
101.3
108.1
105.7
100.5
109.2
105.1
98.9
109.3
105.9
100.1
109.7
106.4
101.8
109.5
106.8
102.8
109.4
37 Materials
38 Durable goods materials
39
Durable consumer parts
40
Equipment parts
41
Other
42
Basic metal materials
43 Nondurable goods materials
44
Textile materials
45
Pulp and paper materials
46
Chemical materials
47
Other
48 Enei^y materials
49
Primary energy
50
Converted fuel materials
40.5
20.5
4.1
7.4
9.0
3.1
9.0
1.2
2.0
3.8
2.0
11.0
7.3
3.7
111.9
115.5
113.9
123.4
109.7
112.5
113.8
104.2
113.7
116.9
113.8
103.7
99.1
112.7
Ul.l
114.4
111.7
122.4
109.1
112.1
113.7
104.7
114.2
116.7
112.8
102.9
101.0
106.6
111.7
114.5
111.0
123.0
109.0
112.0
114.3
104.9
115.7
117.3
112.6
104.4
100.7
111.9
111.7
115.1
110.3
123.8
110.1
112.0
113.7
105.5
112.4
116.9
113.8
103.6
98.0
114.4
112.1
115.6
111.4
124.7
109.9
111.2
114.6
106.1
111.5
118.6
114.9
103.7
98.0
114.9
112.2
116.5
112.6
126.0
110.4
111.7
113.6
103.1
112.7
117.1
114.1
103.1
98.4
112.3
112.8
117.5
116.0
127.0
110.3
112.9
114.1
104.0
113.2
117.2
115.1
103.0
98.2
112.6
113.9
119.1
120.4
127.5
111.6
114.7
115.3
103.7
115.2
119.1
114.9
103.1
97.6
113.8
115.5
121.5
125.7
128.6
113.6
117.6
116.6
102.1
115.2
119.9
120.2
103.2
97.5
114.5
116.0
122.2
126.7
130.7
113.2
116.2
115.4
103.2
114.0
119.7
115.6
104.8
97.3
119.6
116.2
121.9
126.0
131.6
112.0
113.1
116.2
104.4
116.1
120.4
115.1
105.6
100.2
116.1
117.5
123.8
127.1
133.6
114.3
115.1
117.6
106.2
117.6
121.5
116.7
105.4
101.1
113.8
117.4
124.3
126.0
135.1
114.6
116.7
117.1
107.1
115.5
121.5
116.2
104.7
100.4
113.2
117.8
124.6
124.9
136.2
115.0
117.2
118.0
107.0
116.5
123.0
116.6
104.8
100.5
113.2
97.3
95.2
110.6
110.4
109.8
109.6
110.3
110.2
111.0
110.9
111.2
111.1
111.2
111.1
111.5
111.3
112.2
111.8
113.2
112.7
113.7
113.2
114.0
113.4
115.0
114.5
115.2
114.8
115.7
115.3
97.7
108.2
107.5
107.8
108.1
108.2
108.3
108.8
109.6
110.6
111.1
111.3
112.0
112.0
112.1
108.3
107.7
109.5
108.2
109.3
107.8
108.8
107.7
108.8
108.6
108.6
109.0
108.7
109.8
109.3
109.9
109.6
111.0
110.5
111.5
110.6
111.4
110.5
110.8
1 Total index
SPECIAL AGGREGATES
51 Total excluding autos and trucks
52 Total excluding motor vehicles and parts ..
53 Total excluding office and computing
machines
54 Consumer goods excluding autos and
trucks
55 Consumer goods excluding energy
56 Business equipment excluding autos and
trucks
57 Business equipment excluding office and
computing equipment
58 Materials excluding energy
24.8
23.8
108.5
108.2
107.6
107.8
12.8
134.6
133.5
134.5
136.0
136.1
137.2
137.5
138.7
140.6
141.3
143.2
144.4
145.4
147.6
11.3
29.5
119.7
115.0
119.6
114.2
119.2
114.4
119.2
114.7
118.7
115.3
119.8
115.6
120.2
116.5
121.3
118.0
122.5
120.0
123.0
120.1
124.1
120.1
124.1
121.9
124.1
122.1
124.3
122.6
A48
Domestic Nonfinancial Statistics • August 1994
2.13 INDUSTRIAL PRODUCTION
Group
SIC
code2
1987
proportion
Indexes and Gross Value1—Continued
1994
1993
1993
avg.
May
lune
July
Aug.
Sept.
Oct.
Nov.
Dec.
Jan. r
Feb. r
Mar.r
Apr/
Mayp
Index (1987 = 100)
MAJOR INDUSTRIES
59 Total index
100.0
110.9
110.0
110.4
110.9
111.1
111.3
111.9
112.8
114.0
114.6
115.0
115.7
115.9
116.1
60 Manufacturing
61 Primary processing
62 Advanced processing
84.3
27.1
57.1
111.7
107.6
113.7
111.1
106.9
113.1
111.2
107.3
113.0
111.6
107.4
113.6
111.8
107.9
113.6
112.1
107.7
114.2
112.9
108.5
115.0
114.0
109.9
116.0
115.4
111.3
117.4
115.6
110.7
117.9
116.1
110.0
119.0
117.0
111.3
119.7
117.3
111.7
120.0
117.6
112.1
120.1
63
64
65
66
Durable goods
"'24
Lumber and products...
Furniture and fixtures...
25
Gay, glass, and stone
products
32
Primary metals
33
331,2
Iron and steel
Raw steel
Nonferrous
333-6,9
Fabricated metal
34
products
Industrial and commercial
machinery and
computer equipment .
35
Office and computing
machines
357
Electrical machinery
36
Transportation
equipment
37
Motor vehicles and
371
parts
Autos and light
trucks
Aerospace and miscellaneous transportation equipment... 372-6,9
38
Instruments
Miscellaneous
39
46.5
2.1
1.5
114.3
100.6
103.3
113.2
98.2
101.5
113.0
97.6
102.7
113.7
99.6
103.5
113.9
100.9
105.2
115.0
101.8
105.2
116.2
104.6
104.8
118.0
104.9
104.2
120.1
105.2
106.3
120.4
105.2
105.4
120.9
102.8
107.4
121.6
103.3
107.9
122.1
104.0
107.1
122.3
104.7
108.3
2.4
3.3
1.9
.1
1.4
98.7
106.5
111.6
105.7
99.5
97.9
105.0
109.1
105.5
99.2
98.2
105.6
111.1
106.6
98.1
98.8
105.6
111.9
106.9
97.0
98.4
107.2
112.8
106.3
99.4
99.9
107.3
112.4
105.9
100.3
99.7
106.1
113.3
107.2
96.2
100.5
109.8
114.4
106.2
103.5
104.6
113.0
119.1
110.9
104.5
101.1
110.5
115.8
102.0
103.3
100.0
107.6
111.5
105.8
102.1
102.2
111.0
117.3
106.0
102.4
101.2
112.2
118.6
105.3
103.3
101.9
112.8
119.3
5.4
99.5
98.5
98.3
99.6
99.6
99.6
100.7
102.1
102.6
103.9
103.0
103.9
104.4
104.3
Nondurable goods
Foods
Tobacco products
Textile mill products —
Apparel products
Paper and products
Printing and publishing..
Chemicals and products.
Petroleum products
Rubber and plastic
products
Leather and products . . .
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91
92 Mining
93 Metal
94 Coal
95 Oil and gas extraction
96 Stone and earth minerals ..
97 Utilities
96 Electric
99 Gas
103.9
8.5
144.1
141.6
143.3
146.1
147.1
148.4
150.3
152.0
155.7
156.3
158.8
160.8
163.3
166.5
2.3
6.9
223.1
127.5
215.6
125.7
221.4
126.4
226.5
128.6
230.6
129.5
234.8
130.9
241.8
131.4
248.6
132.1
256.1
134.3
261.5
134.8
269.5
136.1
271.2
138.0
276.6
139.9
285.3
140.6
9.9
104.2
104.2
101.2
98.9
98.5
100.4
104.2
108.3
110.7
111.9
113.0
110.1
109.0
106.3
4.8
120.7
118.5
114.7
110.2
110.6
115.1
124.1
132.4
138.5
142.1
146.1
139.9
137.8
132.4
2.5
118.4
116.4
111.2
106.0
104.0
109.2
120.8
131.7
138.4
141.8
148.5
138.4
135.7
127.8
5.1
5.1
1.3
88.7
104.0
109.3
90.7
104.6
109.4
88.6
104.4
108.5
88.3
104.8
108.8
87.2
103.2
108.8
86.7
104.0
110.3
85.5
102.7
109.6
85.7
102.4
110.1
84.5
102.3
110.3
83.4
103.7
110.7
82.0
104.1
109.9
82.2
104.5
110.9
81.9
103.7
111.7
81.8
103.8
111.4
"'20
21
22
23
26
27
28
29
37.8
8.8
1.0
1.8
2.3
3.6
6.5
8.8
1.3
108.7
108.6
91.0
107.8
93.1
112.3
101.3
117.8
104.9
108.5
107.9
94.1
108.7
93.5
112.1
101.1
117.6
103.7
108.9
108.8
89.4
109.3
93.6
114.1
101.3
118.3
104.2
109.1
108.8
97.3
108.5
93.6
111.7
101.6
118.6
103.2
109.2
109.6
90.3
108.8
93.2
112.1
100.9
118.8
103.5
108.5
109.0
85.4
106.6
92.1
111.4
101.1
118.3
105.3
108.8
109.0
86.4
107.7
92.1
112.7
101.6
117.8
108.2
109.1
108.4
83.3
108.0
92.6
114.5
101.7
118.8
107.8
109.7
109.0
84.3
107.4
93.1
115.5
101.9
119.3
107.1
109.6
109.2
88.2
107.8
92.4
113.5
101.7
119.3
104.8
110.1
110.1
86.7
108.7
92.9
114.9
102.3
119.9
104.5
111.5
112.0
88.5
110.0
94.2
114.8
103.3
121.3
104.3
111.4
112.0
89.5
111.7
94.6
113.6
103.1
120.3
107.7
111.7
111.8
90.8
111.5
94.9
113.9
103.6
121.1
108.0
30
31
3.2
.3
115.9
85.0
115.4
85.6
115.1
84.7
116.9
83.8
117.5
83.6
116.7
83.5
116.5
83.9
117.8
83.5
119.3
85.1
120.3
84.8
119.7
83.1
122.5
85.1
122.6
85.5
123.2
84.1
"lO
12
13
14
8.0
.3
1.2
5.8
.7
97.3
167.6
103.8
92.2
93.8
97.1
171.2
102.9
92.1
93.4
97.9
169.7
106.9
92.6
91.3
96.4
170.4
100.9
91.6
92.7
96.6
152.9
98.5
93.3
94.1
97.4
159.4
104.4
92.6
94.5
98.0
175.8
104.4
92.6
94.1
96.9
168.5
101.1
91.8
98.2
96.9
177.3
104.7
90.9
93.9
97.0
177.8
104.0
91.0
94.9
98.8
167.4
114.4
91.8
97.1
99.5
166.6
120.4
91.5
96.3
99.1
167.0
119.8
90.9
98.0
99.5
168.8
116.1
92.0
99.6
49i,3PT
492,3PT
7.7
6.1
1.6
116.2
115.9
117.2
112.4
114.2
105.7
115.4
115.5
115.1
118.0
118.8
115.0
118.4
119.5
114.4
116.2
115.8
118.0
114.9
113.7
119.1
116.1
115.2
119.4
115.8
115.5
117.0
121.9
119.1
132.6
119.8
118.1
126.4
118.0
117.4
120.1
117.4
117.1
118.7
117.1
116.9
117.7
79.5
111.2
110.6
110.9
111.7
111.8
111.9
112.2
112.9
114.0
114.0
114.3
115.6
116.0
116.7
81.9
108.6
108.1
108.0
108.3
108.4
108.6
109.2
110.2
111.4
111.4
111.7
112.6
112.7
112.8
SPECIAL AGGREGATES
100 Manufacturing excluding
motor vehicles and
parts
101 Manufacturing excluding
office and computing
machines
Gross value (billions of 1987 dollars, annual rates)
MAJOR MARKETS
102 Products, total
1,707.0 1,886.9 1,868.0 1,871.8 1,878.8 1,878.2 1,886.3 1,908.8 1,928.2 1,943.9 1,955.4 1,964.1 1,961.4 1,970.6 1,964.5
103 Final
104 Consumer goods
105 Equipment
106 Intermediate
1,314.6 1,480.7 1,466.1 1,468.2 1,471.4 1,470.0 1,479.5 1,498.9 1,514.9 1,525.7 1,535.0 1,547.9 1,543.1 1,548.2 1,541.2
866.6 944.1 933.6 936.1 939.2 937.3 940.2 953.1 960.2 963.7 968.7 974.0 971.8 975.1 967.3
448.0 536.7 532.5 532.1 532.2 532.7 539.2 545.7 554.7 561.9 566.3 573.9 571.3 573.1 573.9
392.5 406.1 401.9 403.7 407.4 408.2 406.9 410.0 413.3 418.2 420.4 416.2 418.3 422.4 423.3
1. Data in this table also appear in the Board's G.17 (419) monthly statistical
release. For the ordering address, see the inside front cover. The latest historical
revision of the industrial production index and the capacity utilization rates was
released in February 1994. See "Industrial Production and Capacity Utilization
since 1990: A Revision," Federal Reserve Bulletin, vol. 80 (March 1994), pp.
220-26. For a detailed description of the industrial production index, see
"Industrial Production: 1989 Developments and Historical Revision," Federal
Reserve Bulletin, vol. 76, (April 1990), pp. 187-204.
2. Standard industrial classification.
Selected Measures
A49
2.14 HOUSING AND CONSTRUCTION
Monthly figures at seasonally adjusted annual rates except as noted
1994
1993
Item
1991
1992
1993
July
Aug.
Sept.
Oct.
Nov.
Dec.
Jan.r
Feb.r
Mar.
Apr.
Private residential real estate activity (thousands of units except as noted)
NEW UNITS
l,474r
l,363rr
l,132 r . l,181rr
293
23 l
1,612
1,406
1,248
1,383
229
158
699
713
574
564
135
139
1,248
1,289
1,107
1,139
141
150
308
283
1,312
1,071
241
1,271
1,125
146
716
577
139
1,216
1,075
141
316
1,252
1,054
198
1,328
1,121
207
720
578
142
1,334
1,185
149
301
1,313
1,068
245
1,519
1,271
248
734
587
147
1,263
1,106
157
308
1,380
1,069
311
1,472
1,208
264
743
588
155
1,359
1,200
159
290
766
294
817r
294r
642
2%
689
299
733
300
683
302
125.0
146.9
130.0
152.5
125.0
146.4r
126.0
153.4
129.5
150.4
132.0
154.1
129.0
153.9
3,990
4,030
4,120
4,350
4,250
3,840
4,070
4,120
107.2
133.6
106.6
133.0
107.1
133.1
107.4
133.7
107.9
134.6
107.2
133.3
107.6
134.4
108.9
135.5
496,907
496,122
505,363
508,531
Permits authorized
One-family
Two-or-more-family
Started
One-family
Two-or-more-family
.
Under construction at end of period'
One-family
Two-or-more-family
Completed
One-family
Two-or-more-family
Mobile homes shipped
949
754
195
1,014
840
174
606
434
173
1,091
838
253
171
1,095
911
184
1,200
1,030
169
612
473
140
1,158
964
194
210
1,19^r
986r
213
1,288
1,126
162
680
543
137
1,193
1,040
153
254
1.1691r
973r
196
1,245
1,076
169
658
526
132
1,097
955
142
246
l,234rr
l,004r
230
1,319
1,178
141
662
534
128
1,248
1,068
180
247
l,265rr
l,036
229
1,359
1,160
199
678
544
134
1,172
1,041
131
254
l,298rr
l,078
220"
1,409
1,231
178
686
551
135
1,248
1,081
167
260
Merchant builder activity in
one-family units
14 Number sold
15 Number for sale at end of period .
507
284
610
266
666r
294
647
277
645
286
738
288
723
291
120.0
147.0
121.3
144.9
126.1
147.6
123.9
143.4
126.6
150.6
129.4
150.1
18 Number sold
3,219
3,520
3,800
3,850
3,860
Price of units sold
(thousands
of dollars)2
19 Median
20 Average
99.7
127.4
103.6
130.8
106.5
133.1
108.4
135.8
108.8
135.4
1
2
3
4
5
6
7
8
9
10
11
12
13
Price of units sold
(thousands
of dollars)2
16 Median
17 Average
EXISTING UNITS (one-family)
Value of new construction (millions of dollars)3
CONSTRUCTION
21 Total put in place
403,439
436,043
470,118
466,593
468,547
477,125
488,661
497,875
508,720
345,572 354,506 364,512 371,444 366,146 365,707 376,228 382,676
209,520 215,934 222,797 229,245 230,190 234,055 238,471 241,174
136,052 138,572 141,715 142,199 135,956 131,652 137,757 141,502
21,346 21,251 22,194 21,767 21,265 20,613 20,557 21,997
42,225 44,224 45,967 48,160 45,407 41,990 46,928 46,445
24,487 24,609 23,998 24,140 22,936 22,513 23,740 24,534
47,994 48,488 49,556 48,132 46,348 46,536 46,532 48,526
22 Private
23 Residential
24 Nonresidential
25
Industrial buildings
26
Commercial buildings
27
Other buildings
28
Public utilities and other
293,536 317,256 342,953 337,909 341,351
157,837 187,820 208,092 204,631 206,594
135,699 129,436 134,861 133,278 134,757
20,720 20,654 19,799 20,126
22,281
48,482 41,523 43,145 41,524 42,342
20,797 21,494 23,405 23,817 25,047
44,139 45,699 47,657 48,138 47,242
29 Public
30 Military
31 Highway
32 Conservation and development...
33 Other
109,900 118,784 127,166 128,684 127,196 131,553 134,155 133,362 137,276 130,761
2,759
2.310
2,237
2,315
2,492
2,583
2,493
2,448
2,502
1,837
32,026 34,929 37,299 37,376 35,148 39,147 40,644 41,341 40,857 40,966
5,681
5,249
5,951
5.311
6,307
5,620
5,661
5,937
5,918
4,861
71,176 75,435 81,482 83,154 83,845 83,607 85,245 84,535 88,798 81,355
1. Not at annual rates.
2. Not seasonally adjusted.
3. Recent data on value of new construction may not be strictly comparable
with data for previous periods because of changes by the Bureau of the Census in
its estimating techniques. For a description of these changes, see Construction
Reports (C-30-76-5), issued by the Census Bureau in July 1976.
SOURCE. Bureau of the Census estimates for all series except (1) mobile homes,
which are private, domestic shipments as reported by the Manufactured Housing
130,414 129,136 125,855
2,215
2,253
2,448
38,515 39,810 38,787
5,164
4,983
6,812
82,639 82,090 79,689
Institute and seasonally adjusted by the Census Bureau, and (2) sales and prices
of existing units, which are published by the National Association of Realtors. All
back and current figures are available from the originating agency. Permit
authorizations are those reported to the Census Bureau from 17,000 jurisdictions
beginning in 1984.
A50
Domestic Nonfinancial Statistics • August 1994
2.15 CONSUMER AND PRODUCER PRICES
Percentage changes based on seasonally adjusted data except as noted
Change from 12
months earlier
Change from 3 months earlier
(annual rate)
Item
1993
May
June
Sept.r
Dec.r
Mar.r
Index
level,
May
19941
19941
1994
1993
1994
May
Change from 1 month earlier
Jan.
Feb.
Mar.
Apr.
May
CONSUMER PRICES2
(1982-84=100)
1 All items
3.2
2.3
2.5
2.0
3.3
2.5
.0
.3
.3
.1
.2
147.5
2 Food
3 Energy items
4 All items less food and energy
5 Commodities
6 Services
2.7
2.0
3.4
2.3
4.0
1.7
-1.4
2.8
1.3
3.5
2.3
-3.8
3.2
.9
4.1
2.6
-4.2
2.1
.0
3.5
4.9
1.2
3.4
2.4
3.7
-1.1
4.7
2.9
.6
4.2
-.1
-.8
.1
.0
.2
-.3
1.6
.3
-.1
.4
.1
.4
.3
.3
.4
.1
-.4
.2
.1
.2
.3
-1.0
.3
.4
.2
143.5
102.9
156.0
137.5
166.6
7 Finished goods
8 Consumer foods
9 Consumer energy
10 Other consumer goods
11 Capital equipment
2.1
3.1
2.3
1.8
1.7
-.4
-.3
-4.3
-.7
2.4
.0
1.3
-5.4
.6
.6
-2.5
3.2
-7.4
-6.4
2.2
-.3
5.2
-15.6
1.5
.3
3.9
-.9
16.6
2.3
4.6
.3r
-,4 r
,4r
-,3 r
2.8
.(fr
,2
.2
.5
.0
.1
.3
-.1
-.5
-.1
-.1
.4
-.1
-.9
-1.0
.4
.4
125.3
126.5
76.2
139.0
134.4
Intermediate materials
12 Excluding foods and feeds
13 Excluding energy
1.6
1.6
.7
1.5
.3
.0
-1.0
1.0
-.3
1.6
2.8
1.6
.R
.2
.4
.0
.2
.2
.0
.2
.2
.3
117.3
125.7
Crude materials
14 Foods
15 Energy
16 Other
3.5
5.0
9.6
-2.0
-9.3
6.6
-3.0
17.5
11.2
13.1
-28.1
-4.5
18.4
-22.1
15.4
-4.8
18.9
23.4
- . 9r
4.1
.6r
-8.2 rr
1.7
-1.0
9.3
.9
-1.1
-.1
-.3
-3.4
1.0
-1.1
110.0
73.7
151.6
PRODUCER PRICES
(1982=100)
1. Not seasonally adjusted.
2. Figures for consumer prices are for all urban consumers and reflect a
rental-equivalence measure of homeownership.
I.R
,4rr
,7
i.r
SOURCE. U.S. Department of Labor, Bureau of Labor Statistics.
Selected Measures
A51
2.16 GROSS DOMESTIC PRODUCT AND INCOME
Billions of current dollars except as noted; quarterly data at seasonally adjusted annual rates
1994
1993
Account
1991
1992
1993
QL
Q2
Q3
Q4r
Ql
GROSS DOMESTIC PRODUCT
1
5,722.9
6,038.5
6,377.9
6,261.6
6,327.6
6,395.9
6,526.5
6,617.6
By source
2 Personal consumption expenditures
3 Durable goods
4 Nondurable goods
5 Services
3,906.4
457.8
1,257.9
2,190.7
4,139.9
497.3
1,300.9
2,341.6
4,391.8
537.9
1,350.0
2,503.9
4,296.2
515.3
1,335.3
2,445.5
4,359.9
531.6
1,344.8
2,483.4
4,419.1
541.9
1,352.4
2,524.8
4,492.0
562.8
1,367.5
2,561.8
4,558.0
578.0
1,382.1
2,597.9
6 Gross private domestic investment
7 Fixed investment
Nonresidential
8
9
Structures
Producers' durable equipment
10
Residential structures
11
736.9
745.5
555.9
182.6
373.3
189.6
796.5
789.1
565.5
172.6
392.9
223.6
891.7
876.1
623.7
178.7
445.0
252.4
874.1
839.5
594.7
172.4
422.2
244.9
874.1
861.0
619.1
177.6
441.6
241.9
884.0
876.3
624.9
179.1
445.8
251.3
934.5
927.6
656.0
185.8
470.2
271.6
966.7
946.6
666.6
176.9
489.7
280.0
1?
13
-8.6
-8.6
7.3
2.3
15.6
21.1
34.6
33.0
13.1
16.8
7.7
22.6
6.9
12.0
20.1
21.7
-19.6
601.5
621.1
-29.6
640.5
670.1
-63.6
661.7
725.3
-48.3
651.3
699.6
-65.1
660.0
725.0
-71.9
653.2
725.1
-69.1
682.4
751.5
-79.7
681.6
761.3
1,099.3
445.9
653.4
1,131.8
448.8
683.0
1,158.1
443.4
714.6
1,139.7
442.7
697.0
1,158.6
447.5
711.1
1,164.8
443.6
721.2
1,169.1
440.0
729.2
1,172.6
441.8
730.8
5,731.6
2,227.0
934.3
1,292.8
3,032.7
471.9
6,031.2
2,305.5
975.8
1,329.6
3,221.1
504.7
6,362.3
2,406.4
1,037.0
1,369.3
3,410.5
545.5
6,227.1
2,362.9
1,003.5
' 1,359.3
3,341.8
522.4
6,314.5
2,395.0
1,037.8
1,357.1
3,388.1
531.5
6,388.2
2,401.7
1,032.9
1,368.8
3,437.8
548.7
6,519.6
2,465.8
1,073.7
1,392.1
3,474.3
579.5
6,597.5
2,501.6
1,097.4
1,404.2
3,524.7
571.2
-8.6
-12.9
4.3
7.3
2.1
5.3
15.6
10.9
4.7
34.6
15.0
19.5
13.1
2.7
10.4
7.7
14.8
-7.2
6.9
11.0
-4.1
20.1
21.7
-1.6
4,861.4
4,986.3
5,136.0
5,078.2
5,102.1
5,138.3
5,225.6
5,264.1
30
4,598.3
4,836.6
5,140.3R
5,038.9
5,104.0
5,143.2
5,275.0 R
5,309.8
31 Compensation of employees
37 Wages and salaries
33
Government and government enterprises
Other
34
35 Supplement to wages and salaries
Employer
contributions for social insurance
36
Other labor income
37
3,402.4
2,814.9
545.3
2,269.6
587.5
290.6
296.9
3,582.0
2,953.1
567.5
2,385.6
629.0
306.3
322.7
3,772.2
3,100.5
589.7
2,510.8
671.7
321.0
350.7
3,705.1
3,054.3
584.1
2,470.2
650.7
312.2
338.5
3,750.6
3,082.7
586.3
2,496.3
668.0
321.4
346.6
3,793.9
3,115.4
592.8
2,522.6
678.5
323.8
354.7
3,839.2
3,149.6
595.4
2,554.2
689.6
326.7
362.9
3,908.5
3,201.9
603.0
2,598.9
706.6
334.7
371.9
376.4
339.5
36.8
414.3
370.6
43.7
443.2
397.3
46.0
444.1
388.4
55.7
439.4
392.4
47.0
422.5
397.6
24.8
467.0
410.6
56.4
474.6
416.6
57.9
-12.8
-8.9
12.6
7.5
12.7
13.7
16.4
507.9"r
488.4
-4.3
23.9
474.4
470.3
-16.0
20.1
444.5
449.7
Change in business inventories
14 Net exports of goods and services
15
16 Imports
17 Government purchases of goods and services
18
19 State and local
70
?1
By major type of product
??
?3
?4
25
Nondurable
Structures
26 Change in business inventories
27 Durable goods
28 Nondurable goods
MEMO
29 Total GDP in 1987 dollars
NATIONAL INCOME
1
38 Proprietors'income
39 Business
and professional
1
40 Farm
41 Rental income of persons2
4? Corporate profits
43 Profits before tax3
44 Inventory valuation adjustment
45 Capital consumption adjustment
369.5
362.3
4.9
2.2
407.2
395.4
-5.3
17.1
466.6rr
449.4
-7.1
24.3
432.1
419.8
-12.7
25.1
458.1
445.6
-12.2
24.7
468.5
443.8
1.0
23.8
46
462.8
442.0
445.6
450.1
443.2
444.6
1
1. With inventory valuation and capital consumption adjustments.
2. With capital consumption adjustment.
3. For after-tax profits, dividends, and the like, see table 1.48.
SOURCE. U.S. Department of Commerce, Survey of Current Business.
2.5
A52
Domestic Nonfinancial Statistics • August 1994
2.17 PERSONAL INCOME AND SAVING
Billions of current dollars except as noted; quarterly data at seasonally adjusted annual rates
1994
1993
Account
1991
1992
1993
Ql
Q2
Q3
Q4
Ql
PERSONAL INCOME AND SAVING
1 Total personal income
4,850.9
5,144.9
5,388.3
5,254.7
5,373.2
5,412.7
5,512.7
5,576.8
2 Wage and salary disbursements
3 Commodity-producing industries
2,815.0
738.1
557.2
648.0
883.5
545.4
2,973.1
756.5
577.6
682.0
967.0
567.5
3,080.5
763.6
577.3
706.6
1,020.6
589.7
2,974.3
740.7
559.7
682.9
966.6
584.1
3,082.7
765.1
580.3
709.1
1,022.2
586.3
3,115.4
769.4
581.5
714.4
1,038.8
592.8
3,149.6
779.3
587.8
720.1
1,054.7
595.4
3,201.9
789.6
595.6
733.4
1,075.9
603.0
296.9
376.4
339.5
36.8
-12.8
127.9
715.6
769.9
382.3
322.7
414.3
370.6
43.7
-8.9
140.4
694.3
858.4
413.9
350.7
443.2
397.3
46.0
12.6
158.3
695.2
912.1
438.4
338.5
444.1
388.4
55.7
7.5
157.0
695.4
894.4
433.1
346.6
439.4
392.4
47.0
12.7
157.8
693.1
905.5
435.0
354.7
422.5
397.6
24.8
13.7
159.0
695.7
918.5
439.4
362.9
467.0
410.6
56.4
16.4
159.4
696.7
929.8
446.1
371.9
474.6
416.6
57.9
2.5
160.7
700.2
944.3
457.8
5
6
7
Distributive industries
Service industries
Government and government enterprises
8 Other labor income
9 Proprietors' income
10 Business and professional1
12 Rental income of persons2
13 Dividends
14 Personal interest income
15 Transfer payments
16 Old-age survivors, disability, and health insurance benefits . . .
17
LESS: Personal contributions for social insurance
18 EQUALS: Personal income
237.8
249.3
264.3
256.6
264.5
266.8
269.2
279.3
4,850.9
5,144.9
5,388.3
5,254.7
5,373.2
5,412.7
5,512.7
5,576.8
620.4
644.8
681.6
657.1
681.0
689.0
699.2
715.8
20 EQUALS: Disposable personal income
4,230.5
4,500.2
4,706.7
4,597.5
4,692.2
4,723.7
4,813.5
4,860.9
21
LESS: Personal outlays
4,029.0
4,261.5
4,516.8
4,419.7
4,483.6
4,544.0
4,620.1
4,689.2
22 EQUALS: Personal saving
201.5
238.7
189.9
177.9
208.7
179.7
193.4
171.8
19,237.9
12,895.2
13,965.0
19,518.0
13,080.9
14,219.0
19,887.4
13,371.3
14,330.0
19,744.4
13,234.2
14,163.0
19,785.4
13,311.6
14,326.0
19,868.8
13,416.2
14,341.0
20,150.1
13,522.7
14,491.0
20,250.4
13,642.2
14,549.0
4.8
5.3
4.0
3.9
4.4
3.8
4.0
3.5
733.7
717.8
780.2R
762.0
766.7
774.3
817.8 R
858.4
r
19
LESS: Personal tax and nontax payments
MEMO
Per capita (1987 dollars)
23 Gross domestic product
24 Personal consumption expenditures
25 Disposable personal income
26 Saving rate (percent)
GROSS SAVING
27 Gross saving
28 Gross private saving
929.9
986.9
l,004.8
1,024.8
988.3
988.7
l,017.5r
1,024.9
29 Personal saving
30 Undistributed corporate profits
31 Corporate inventory valuation adjustment
201.5
102.3
4.9
238.7
110.4
-5.3
189.9r
123.6
-7.1
177.9
103.7
-12.7
208.7
116.3
-12.2
179.7
129.3
1.0
193.4r
145.l
-4.3
171.8
117.3
-16.0
383.2
242.8
396.6
261.3
408.8
262.5
402.2
261.0
405.2
258.1
414.0
265.7
413.9
265.1
433.3
302.5
-196.2
-203.4
7.3
-269.1
-276.3
7.2
-224.6rr
-226.4 r
1.8
-262.8
-263.5
.8
-221.5
-222.6
1.1
-214.4
-212.7
-1.7
—199.7rr
-207.0 r
7.2
-166.5
-164.7
-1.8
37 Gross investment
743.3
741.4
795.4
796.5
778.7
787.6
819.0
853.7
38 Gross private domestic
736.9
6.4
796.5
-55.1
891.7
-96.2
874.1
-77.6
874.1
-95.4
884.0
-96.4
934.5
-115.5
966.7
-113.0
9.6
23.6
15.2R
34.4
12.0
13.3
Capital consumption allowances
33 Noncorporate
34 Government surplus, or deficit (-), national income and
product accounts
35 Federal
36 State and local
40 Statistical discrepancy
1. With inventory valuation and capital consumption adjustments.
2. With capital consumption adjustment.
1.2R
SOURCE. U.S. Department of Commerce, Survey of Current Business.
-4.7
Summary Statistics
A53
3.10 U.S. INTERNATIONAL TRANSACTIONS Summary
Millions of dollars; quarterly data seasonally adjusted except as noted1
1993r
Item credits or debits
1992
1991
1994
1993r
r
r
-103,896
-132,575
456,866
-589,441
-763
57,613
3,946
-14,620
-3,785
-13,712
Ql
Q2
Q3
Q4
Ql p
-19,850
-29,191
111,664
-140,855
-105
14,874
1,855
-3,186
-827
-3,270
-25,602
-33,727
113,787
-147,514
-129
14,786
668
-2,730
-985
-3,486
-27,856
-36,488
111,736
-148,224
-87
14,317
2,015
-3,114
-986
-3,513
-30,587
-33,169
119,679
-152,848
—444
13,637
-590
-5,591
-987
-3,443
-31,901
-36,%5
-6,952
-74,068
416,913
-490,981
-5,485
51,082
14,832
23,959
-3,461
-13,811
-67,886
-96,097
440,361
-536,458
-3,034
58,747
4,540
-15,010
-3,735
-13,297
2,900
-1,652
-306
488
-281
-192
-321
446
12 Change in U.S. official reserve assets (increase, - )
13 Gold
14 Special drawing rights (SDRs)
15 Reserve position in International Monetary Fund
16 Foreign currencies
5,763
3,901
-1,379
-983
822
-545
-673
-59
-177
-367
6,307
2,316
-2,692
4,277
-537
-44
-797
-140
-166
-118
-113
-101
-228
313
675
-48
-378
-80
-480
-3
45
17 Change in U.S. private assets abroad (increase, - )
18 Bank-reported claims3
19 Nonbank-reported claims
20 U.S. purchases of foreign securities, net
21 U.S. direct investments abroad, net
-60,175
4,763
11,097
-44,740
-31,295
-63,759
22,314
45
-45,114
-41,004
-146,213
32,238
-598
-119,983
-57,870
-12,164
-34,915
7,335
4,838
-40,777
-6,311
-62,628
-9,293
-303
-30,349
-22,683
-56,325
-9,062
-5,046
-24,517
-11,202
-36,507
5,595
-87
-24,340
-17,675
22 Change in foreign official assets in United States (increase, +) . .
23 U.S. Treasury securities
24 Other U.S. government obligations
25 Other U.S. government liabilities4
^
26 Other U.S. liabilities reported by U.S. banks 3
27 Other foreign official assets 3
17,199
14,846
1,301
1,177
-1,484
1,359
40,858
18,454
3,949
2,572
16,571
10,968
1,080
665
-438
8,257
1,404
17,492
5,668
1,082
158
9,485
1,099
19,259
19,098
1,345
1,121
-2,489
184
23,%2
22,856
970
825
-587
-688
71,681
48,702
4,062
1,666
14,666
2,585
11,353
1,361
50
1,0%
9,636
-790
28 Change in foreign private assets in United States (increase, + ) . .
29 U.S. bank-reported liabilities3
30 U.S. nonbank-reported liabilities
31 Foreign private purchases of U.S. Treasury securities, net
32 Foreign purchases of other U.S. securities, net
33 Foreign direct investments in United States, net
80,935
3,994
-3,115
105,646
15,461
13,573
36,857
29,867
9,888
159,017
18,452
14,282
24,849
80,068
21,366
5,804
-19,995
774
14,001
9,590
1,434
34,337
3,459
7,606
52,675
27,618
1,169
3,474
17,445
2,%9
66,200
7,370
4,733
7,9%
38,008
8,093
1 Balance on current account
2 Merchandise trade balance
Merchandise exports
3
Merchandise imports
4
5 Military transactions, net
6 Other service transactions, net
Investment income, net
7
8
U.S. government grants
U.S. government pensions and other transfers
9
10 Private remittances and other transfers
11 Change in U.S. government assets other than official
reserve assets, net (increase, - )
34 Allocation of special drawing rights
35 Discrepancy
36 Due to seasonal adjustment
37 Before seasonal adjustment
0
18,826
35,144
26,086
0
0
0
0
0
-39,670
-17,108
21,0%
-39,670
-17,108
21,096
0
-615
28,601
0
15,737
6,105
9,632
0
-622
15,025
8,869
0
9,739
435
9,304
0
0
-8,427
-6,643
-1,785
0
-102
0
4,047
103
3,944
118,012
-154,977
-391
13,091
-367
-2,427
-966
-3,876
0
-26,904
-20,359
71,774
34,118
' 9,243
20,340
8,073
0
4,712
5,719
-1,007
MEMO
Changes in official assets
38 U.S. official reserve assets (increase, - )
39 Foreign official assets in United States, excluding line 25
(increase, +)
5,763
3,901
-1,379
-983
822
-545
-673
-59
16,022
38,286
70,015
11,406
17,334
18,138
23,137
10,257
40 Change in Organization of Petroleum Exporting Countries
official assets in United States (part of line 22)
-4,882
5,942
-3,847
445
-869
-3,194
-229
-1,937
1. Seasonal factors are not calculated for lines 12-16,18-20, 22-34, and 38-40.
2. Data are on an international accounts basis. The data differ from the Census
basis data, shown in table 3.11, for reasons of coverage and timing. Military
exports are excluded from merchandise trade data and are included in line 5.
3. Reporting banks include all types of depository institution as well as some
brokers and dealers.
4. Associated primarily with military sales contracts and other transactions
arranged with or through foreign official agencies.
5. Consists of investments in U.S. corporate stocks and in debt securities of
private corporations and state and local governments.
SOURCE. U.S. Department of Commerce, Bureau of Economic Analysis,
Survey of Current Business.
A54
3.11
International Statistics • August 1994
U.S. FOREIGN TRADE1
Millions of dollars; monthly data seasonally adjusted
1993r
Item
1991r
1992r
1994
1993r
Oct.
Nov.
Dec.
Jan.r
Feb/
Mar/
Apr."
1 Goods and services, balance
2 Merchandise
3 Services
-28,472
-74,068
45,596
-40,384
-96,097
55,713
-75,725
-132,575
56,850
-7,919
-12,534
4,615
-7,534
-11,522
3,988
-4,526
-9,115
4,589
-7,780
-11,971
4,191
-9,609
-13,541
3,932
-6,875
-11,450
4,575
-8,395
-13,304
4,909
4 Goods and services, exports
5 Merchandise
6 Services
580,127
416,913
163,214
616,924
440,361
176,563
641,677
456,866
184,811
55,086
39,361
15,725
54,464
39,364
15,100
56,727
40,953
15,774
53,479
38,530
14,949
52,645
37,426
15,219
58,072
42,060
16,012
56,183
40,292
15,891
7 Goods and services, imports
8 Merchandise
9 Services
-608,599
-490,981
-117,618
-657,308
-536,458
-120,850
-717,402
-589,441
-127,961
-63,005
-51,895
-11,110
-61,998
-50,886
-11,112
-61,253
-50,068
-11,185
-61,259
-50,501
-10,758
-62,254
-50,967
-11,287
-64,947
-53,510
-11,437
-64,578
-53,596
-10,982
-66,723
-84,501
-115,568
-10,830
-9,895
-7,782
-10,850
-12,072
-9,583
-12,003
MEMO
10 Balance on merchandise trade, Census
basis
1. Data show monthly values consistent with quarterly figures in the U.S.
balance of payments accounts.
SOURCE. FT900, U.S. Department of Commerce, Bureau of the Census and
Bureau of Economic Analysis.
3.12 U.S. RESERVE ASSETS
Millions of dollars, end of period
1993
1994
Asset
Feb.
1 Total
2 Gold stock, including Exchange
Stabilization Fund
3 Special drawing rights2,3
4 Reserve position in International
Monetary Fund2
5 Foreign currencies4
Apr.
83,316
77,719
71,323
74,042
73,442
74,243
75,766
76,809
76,565
11,058
10,989
11,057
11,240
11,056
8,503
11,054
9,091
11,053
9,039
11,053
9,070
11,053
9,295
11,052
9,383
11,053
9,440
9,076
52,193
9,488
45,934
11,759
40,005
11,827
42,070
11,818
41,532
11,906
42,214
11,974
43,444
12,135
44,239
11,899
44,173
1. Gold held "under earmark" at Federal Reserve Banks for foreign and
international accounts is not included in the gold stock of the United States; see
table 3.13, line 3. Gold stock is valued at $42.22 per fine troy ounce.
2. Special drawing rights (SDRs) are valued according to a technique adopted
by the International Monetary Fund (IMF) in July 1974. Values are based on a
weighted average of exchange rates for the currencies of member countries. From
July 1974 through December 1980, sixteen currencies were used; since January
1981,fivecurrencies have been used. U.S. SDR holdings and reserve positions in
the IMF also have been valued on this basis since July 1974.
3. Includes allocations of SDRs by the International Monetary Fund on Jan. 1
of the year indicated, as follows: 1970—$867 million; 1971—$717 million; 1972—
$710 million; 1979—$1,139 million; 1980—$1,152 million; 1981—$1,093 million;
plus net transactions in SDRs.
4. Valued at current market exchange rates.
3.13 FOREIGN OFFICIAL ASSETS HELD AT FEDERAL RESERVE BANKS 1
Millions of dollars, end of period
1993
Asset
1990
1991
Nov.
1 Deposits
Held in custody
2 U.S. Treasury securities2
3 Earmarked gold
Dec.
Jan.
Feb.
Mar.
Apr.
Mayp
369
968
205
596
386
257
190
454
171
174
278,499
13,387
281,107
13,303
314,481
13,118
373,864
12,381
379,394
12,327
388,065
12,302
393,238
12,238
399,817
12,145
396,495
12,104
402,170
12,065
1. Excludes deposits and U.S. Treasury securities held for international and
regional organizations.
2. Marketable U.S. Treasury bills, notes, and bonds and nonmarketable U.S.
Treasury securities at face value.
1994
1992
3. Held in foreign and international accounts and valued at $42.22 per fine troy
ounce; not included in the gold stock of the United States.
Summary Statistics
A55
3.15 SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS
Millions of dollars, end of period
1993
Item
1991
Oct.
1 Total
2
3
4
5
6
7
8
9
10
11
12
1
By type
Liabilities reported by banks in the United States^
U.S. Treasury bills and certificates
U.S. Treasury bonds and notes
Marketable
Nonmarketable
U.S. securities other than U.S. Treasury securities
By area
Europe 1
Canada
Latin America and Caribbean
Asia
Africa
Other countries
1994
1992
Nov.
Dec.
Jan.
Feb.
Mar.
Apr."
r
479,602
466,689
360,530
398,816
444,107
457,129
468,825
478,608
477,993
38,3%
92,692
54,%7
104,5%
65,668
140,525
67,964
144,865
69,633
150,900
78,546
146,940
77,998r
143,222
79,786
148,707
74,581
140,653
203,677
4,858
20,907
210,553
4,532
24,168
201,965
5,579
30,370
208,188
5,615
30,497
211,825
5,652
30,815
216,109
5,689
31,324
220,154
5,725
30,894
215,271
5,763
30,075
215,856
5,799
29,800
171,317
7,460
33,554
139,465
2,092
6,640
191,708
7,920
40,025
152,276
3,565
3,320
193,676
9,441
54,275
178,889
3,665
4,159
208,790
8,657
50,410
182,437
3,650
3,183
209,229
9,505
57,950
185,289
3,894
2,956
216,794
10,084
57,661
187,337
3,681
3,049
210,751
9,844
61,303r
189,025
4,043
3,025
217,444
8,328
55,441
191,705
3,559
3,123
212,675
8,462
46,517
192,076
3,549
3,408
1. Includes the Bank for International Settlements.
2. Principally demand deposits, time deposits, bankers acceptances, commercial paper, negotiable time certificates of deposit, and borrowings under repurchase agreements.
3. Includes nonmarketable certificates of indebtedness (including those payable
in foreign currencies through 1974) and Treasury bills issued to official institutions
of foreign countries.
4. Excludes notes issued to foreign official nonreserve agencies. Includes
bonds and notes payable in foreign currencies; zero coupon bonds are included at
current value.
5. Debt securities of U.S. government coiporations and federally sponsored
agencies, and U.S. corporate stocks and bonds.
6. Includes countries in Oceania and Eastern Europe.
SOURCE. Based on Treasury Department data and on data reported to the
Treasury Department by banks (including Federal Reserve Banks) and securities
dealers in the United States and on the 1984 benchmark survey of foreign portfolio
investment in the United States.
3.16 LIABILITIES TO, AND CLAIMS ON, FOREIGNERS
Payable in Foreign Currencies
Reported by Banks in the United States1
Millions of dollars, end of period
1993
Item
1 Banks' liabilities
2 Banks' claims
3 Deposits
4 Other claims
5 Claims of banks' domestic customers 2
1990
70,477
66,7%
29,672
37,124
6,309
1. Data on claims exclude foreign currencies held by U.S. monetary
authorities.
1991
75,129
73,195
26,192
47,003
3,398
1992
72,7%
62,799
24,240
38,559
4,432
June
Sept.
Dec.
Mar.
75,206
55,533
20,464
35,069
3,234
81,205
59,116
20,930
38,186
2,640
77,627
60,271
19,379
40,892
3,145
85,445
72,126
18,118
54,008
3,492
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.
A56
International Statistics • August 1994
3.17 LIABILITIES TO FOREIGNERS
Payable in U.S. dollars
Reported by Banks in the United States1
Millions of dollars, end of period
1994
1993
Item
1991
1992
1993
Oct.
Nov.
Dec.
Jan.
Feb/
Mar.
Apr.p
HOLDER AND TYPE OF LIABILITY
1 Total, all foreigners
756,066
810,259
906,003
877,062
893,284
906,003
889,604
918,745
949,767
956,972
2 Banks' own liabilities
3 Demand deposits
4 Time deposits
5 Other.
6 Own foreign offices
575,374
20,321
159,649
66,305
329,099
606,444
21,828
160,385
93,237
330,994
620,689
21,576
174,984
109,873
314,256
610,744
22,014
159,375
128,942
300,413
616,209
25,462
156,994
126,845
306,908
620,689
21,576
174,984
109,873
314,256
608,947
23,488
158,943
129,423
297,093
631,065
24,217
159,613
136,126
311,109
649,309
22,905
176,684
112,768
336,952
666,791
23,509
177,760
124,572
340,950
180,692
110,734
203,815
127,644
285,314
176,430
266,318
164,365
277,075
169,729
285,314
176,430
280,657
170,694
287,680
166,980
300,458
173,137
290,181
167,891
18,664
51,294
21,974
54,197
36,078
72,806
37,562
64,391
38,555
68,791
36,078
72,806
37,329
72,634
41,892
78,808
41,727
85,594
38,151
84,139
8,981
6,827
43
2,714
4,070
9,350
6,951
46
3,214
3,691
10,846
5,550
15
2,780
2,755
10,994
6,790
71
2,978
3,741
12,965
9,091
34
2,863
6,194
10,846
5,550
15
2,780
2,755
10,869
6,855
21
3,305
3,529
7,099
5,724
120
2,503
3,101
8,088
5,643
209
2,424
3,010
5,914
4,330
26
2,361
1,943
2,154
1,730
2,399
1,908
5,296
4,275
4,204
3,566
3,874
3,201
5,296
4,275
4,014
3,497
1,375
1,321
2,445
2,097
1,584
1,358
424
486
5
1,021
0
0
638
0
672
1
1,021
0
517
0
54
0
338
10
226
0
131,088
34,411
2,626
16,504
15,281
159,563
51,202
1,302
17,939
31,961
220,533
64,056
1,601
21,634
40,821
206,193
60,995
2,121
14,885
43,989
212,829
62,168
2,089
17,188
42,891
220,533
64,056
1,601
21,634
40,821
225,486
71,531
1,631
20,237
49,663
221,220
67,369
1,406
20,028
45,935
228,493
67,085
1,758
23,923
41,404
215,234
64,568
1,504
21,951
41,113
96,677
92,692
108,361
104,596
156,477
150,900
145,198
140,525
150,661
144,865
156,477
150,900
153,955
146,940
153,851
143,222
161,408
148,707
150,666
140,653
3,879
106
3,726
39
5,482
95
4,491
182
5,614
182
5,482
95
6,855
160
10,527
102
12,414
287
9,969
44
522,265
459,335
130,236
8,648
82,857
38,731
329,099
547,320
476,117
145,123
10,170
90,296
44,657
330,994
573,924
474,642
160,386
9,719
105,192
45,475
314,256
553,351
461,827
161,414
9,948
95,704
55,762
300,413
562,372
468,526
161,618
13,369
92,265
55,984
306,908
573,924
474,642
160,386
9,719
105,192
45,475
314,256
549,192
451,260
154,167
11,025
87,788
55,354
297,093
583,425
478,941
167,832
11,986
92,301
63,545
311,109
608,055
497,382
160,430
10,609
104,661
45,160
336,952
621,119
514,477
173,527
11,656
107,433
54,438
340,950
62,930
7,471
71,203
11,087
99,282
10,707
91,524
10,046
93,846
10,539
99,282
10,707
97,932
9,832
104,484
11,051
110,673
10,745
106,642
10,079
5,694
49,765
7,555
52,561
16,810
71,765
19,106
62,372
17,124
66,183
16,810
71,765
17,136
70,964
17,010
76,423
17,383
82,545
15,684
80,879
93,732
74,801
9,004
57,574
8,223
94,026
72,174
10,310
48,936
12,928
100,700
76,441
10,241
45,378
20,822
106,524
81,132
9,874
45,808
25,450
105,118
76,424
9,970
44,678
21,776
100,700
76,441
10,241
45,378
20,822
104,057
79,301
10,811
47,613
20,877
107,001
79,031
10,705
44,781
23,545
105,131
79,199
10,329
45,676
23,194
114,705
83,416
10,323
46,015
27,078
18,931
8,841
21,852
10,053
24,259
10,548
25,392
10,228
28,694
11,124
24,259
10,548
24,756
10,425
27,970
11,386
25,932
11,588
31,289
15,801
8,667
1,423
10,207
1,592
12,765
946
13,327
1,837
15,145
2,425
12,765
946
12,821
1,510
14,301
2,283
11,592
2,752
12,272
3,216
7,456
9,111
17,567
17,533
17,089
17,567
17,509
17,929
19,209
17,961
7 Banks' custodial liabilities5
8 U.S. Treasury bills and certificates
9 Other negotiable and readily transferable
instruments
10 Other
11 Nonmonetary international and regional
organizations
12 Banks' own liabilities
13
Demand deposits
14
Time deposits
Other.
15
16
17
18
19
Banks' custodial liabilities5
U.S. Treasury bills and certificates6
Other negotiable and readily transferable
instruments
Other
20 Official institutions9
21 Banks' own liabilities
22
Demand deposits
23
Time deposits
Other.
24
25
26
27
28
Banks' custodial liabilities5
U.S. Treasury bills and certificates6
Other negotiable and readily transferable
instruments
Other
29 Banks10
30 Banks' own liabilities
Unaffiliated foreign banks
31
32
Demand deposits
33
Time 5deposits
34
Other
Own foreign offices
35
36
37
38
39
Banks' custodial liabilities5
U.S. Treasury bills and certificates6
Other negotiable and readily transferable
instruments
Other
40 Other foreigners
41 Banks' own liabilities
47
Demand deposits
43
Time deposits
44
Other.
45
46
47
48
Banks' custodial liabilities5
U.S. Treasury bills and certificates
Other negotiable and readily transferable
instruments
Other
MEMO
49 Negotiable time certificates of deposit in custody for
foreigners
1. Reporting banks include all types of depository institution, as well as some
brokers and dealers.
2. Excludes negotiable time certificates of deposit, which are included in
"Other negotiable and readily transferable instruments."
3. Includes borrowing under repurchase agreements.
4. For U.S. banks, includes amounts owed to own foreign branches and foreign
subsidiaries consolidated in Consolidated Report of Condition filed with bank
regulatory agencies. For agencies, branches, and majority-owned subsidiaries of
foreign banks, consists principally of amounts owed to head office or parent
foreign bank, and foreign branches, agencies, or wholly owned subsidiaries of
head office or parent foreign bank.
5. Financial claims on residents of the United States, other than long-term
securities, held by or through reporting banks.
6. Includes nonmarketable certificates of indebtedness and Treasury bills
issued to official institutions of foreign countries.
7. Principally bankers acceptances, commercial paper, and negotiable time
certificates of deposit.
8. Principally the International Bank for Reconstruction and Development, the
Inter-Amencan Development Bank, and the Asian Development Bank. Excludes
"holdings of dollars" of the International Monetary Fund.
9. Foreign central banks, foreign central governments, and the Bank for
International Settlements.
10. Excludes central banks, which are included in "Official institutions."
Bank-Reported Data
3.17
A57
LIABILITIES TO FOREIGNERS Reported by Banks in the United States1—Continued
1994
1993
1991
Item
1992
1993
Oct.
Nov.
Dec.
Jan.
Feb. r
Mar.
Apr."
AREA
1 Total, all foreigners
756,066
810,259
906,003
877,062
893,284
906,003
889,604
918,745
949,767
956,972
2 Foreign countries
747,085
800,909
895,157
866,068
880,319
895,157
878,735
911,646
941,679
951,058
,097
,193
,337
937
,341
307,670
,238
,598
,292
622
,741
20,567
3,060
1,299
41,411
18,630
913
10,041
7,365
3,314
2,465
577
9,793
2,953
39,440
2,666
111,805
504
29,256
376,642
1,907
28,650
4,517
1,872
39,705
26,617
1,530
11,561
16,031
2,975
3,366
2,511
20,494
2,573
41,588
3,228
133,788
570
33,159
357,848
1,808
24,641
5,084
2,712
43,034
22,820
1,366
10,466
13,368
2,796
3,215
2,623
20,182
2,355
43,195
2,897
130,941
541
23,804
369,534
1,797
27,541
4,151
2,250
36,638
27,025
1,704
10,734
14,737
3,199
3,229
2,530
19,705
2,672
42,506
2,947
135,712
546
29,911
376,642
1,907
28,650
4,517
1,872
39,705
26,617
1,530
11,561
16,031
2,975
3,366
2,511
20,494
2,573
41,588
3,228
133,788
570
33,159
368,736
2,567
29,402
5,089
1,843
32,244
27,576
1,361
10,702
17,532
2,533
3,131
2,208
19,652
2,301
40,854
3,120
130,778
549
35,294
393,466
2,159
30,617
4,829
1,737
38,426
30,241
1,463
12,741
17,083
2,340
3,170
2,017
18,119
2,428
41,000
3,241
148,150
428
33,283
399,154
2,515
31,827
3,093
1,495
42,010
31,771
1,425
12,786
17,686
2,429
3,131
1,971
19,619
1,067
39,244
2,922
150,632
414
33,117
406,195
2,719
32,043
3,342
1,932
43,137
32,704
1,160
11,914
16,330
2,537
4,061
3,041
18,317
2,532
41,438
2,972
154,533
407
31,076
21,605
22,420
20,228
27,452
24,152
20,228
20,589
23,200
21,404
22,510
345,190
14,435
72,430
6,697
5,386
175,181
3,726
3,363
30
858
1,230
421
30,616
6,230
3,429
913
1,534
12,598
6,113
358,224
13,991
77,449
6,181
5,244
188,044
3,572
3,427
38
822
1,169
419
27,804
5,311
3,388
873
1,492
12,968
6,032
361,059
13,246
80,821
7,614
4,867
192,343
3,829
3,992
9
844
1,155
495
22,358
5,006
3,509
893
1,408
12,307
6,363
3 Europe
4 Austria
5 Belgium and Luxembourg
6 Denmark
Finland
7
8
France
9 Germany
10 Greece
11 Italy
12 Netherlands
13 Norway
14 Portugal
15 Russia
16 Spain
17 Sweden
18 Switzerland
19 Turkey
20 United Kingdom
21 Yugoslavia"
22 Other Europe and former U.S.S.R.
,808
,619
765
,541
,161
,866
,184
241
,391
,222
...
23 Canada
1,611
6,178
327,666
14,320
76,557
8,021
5,057
159,434
3,952
3,025
7
868
1,275
376
24,249
5,283
3,567
873
1,716
12,903
6,183
331,875
13,695
78,354
7,287
5,069
166,637
3,455
3,101
7
851
1,243
401
21,947
4,725
3,468
890
1,643
13,076
6,026
342,781
14,493
73,077
7,875
5,307
175,710
3,197
3,173
33
881
1,207
410
28,060
4,206
3,625
926
1,617
12,806
6,178
338,524
14,495
71,687
7,794
5,127
171,892
3,576
3,587
34
891
1,258
387
27,667
5,139
3,592
880
1,727
12,460
6,331
143,540
144,653
141,363
144,476
144,653
140,096
139,562
152,460
149,208
3,202
8,408
18,499
1,399
1,480
3,773
58,435
3,337
2,275
5,582
21,437
15,713
4,011
10,634
17,233
1,113
1,986
4,436
61,483
4,913
2,035
6,137
15,825
14,847
3,280
9,804
16,389
1,251
1,504
5,450
60,171
3,889
2,192
6,446
14,681
16,306
3,187
10,960
18,673
1,425
1,674
4,582
58,866
4,409
1,902
6,231
15,489
17,078
4,011
10,634
17,233
1,113
1,986
4,436
61,483
4,913
2,035
6,137
15,825
14,847
4,075
9,960
18,675
1,436
1,807
4,138
58,606
4,721
1,912
6,156
13,131
15,479
4,565
9,475
17,730
1,127
1,659
4,628
60,112
4,856
1,820
5,838
11,919
15,833
5,294
9,306
18,688
1,658
2,345
4,580
66,403
4,808
2,542
5,985
13,305
17,546
6,058
8,696
19,092
1,466
1,873
4,099
62,274
4,646
2,616
5,550
13,655
19,183
6,638
2,209
99
451
1,303
2,564
6,179
2,220
87
367
15
1,271
2,219
5,762
2,089
110
272
10
1,446
1,835
6,638
2,209
99
451
12
1,303
2,564
5,823
1,961
94
214
13
1,186
2,355
6,327
2,058
73
294
8
1,433
2,461
5,748
1,658
89
285
11
1,139
2,566
5,812
1,687
76
331
11
983
2,724
3,178
5,704
163,620
3,283
4,661
2
1,232
1,594
231
19,957
5,592
4,695
1,249
2,096
13,181
6,879
317,228
9,477
82,284
7.079
5,584
153,033
3,035
4,580
3
993
1,377
371
19,454
5,205
4,177
1.080
1,955
11,387
6,154
342,781
14,493
73,077
7,875
5.307
175,710
3,197
3,173
33
120,462
2,626
24 Latin America and Caribbean
25 Argentina
26 Bahamas
27 Bermuda
28 Brazil
29 British West Indies
30 Chile
31 Colombia
32 Cuba
33 Ecuador
34 Guatemala
35 Jamaica
36 Mexico
37 Netherlands Antilles
38 Panama
39 Peru
40 Uruguay
41 Venezuela
42 Other
345,529
7,753
43 Asia
China
44
People's Republic of China
45
Republic of China (Taiwan)
46 Hong Kong
47 India
48 Indonesia
49 Israel
50 Japan
51 Korea (South)
52 Philippines
53 Thailand
54 Middle Eastern oil-exporting countries 13
55 Other
100,622
11,491
14,269
2,418
1.463
2,015
47,069
2,587
2,449
2,252
15,752
16,071
881
1,207
410
28,060
4,206
3,625
926
1,617
12,806
56 Africa
57 Egypt
58 Morocco
59 South Africa
60 Zaire
61 Oil-exporting countries
62 Other
4,825
1,784
5,884
2,472
76
190
19
1,346
1,781
63 Other
64 Australia
65 Other
5,567
4.464
1,103
4,167
3,043
1,124
4,215
3.308
907
5,560
4,434
1,126
4,520
3,317
1,203
4,215
3,308
907
4,967
3,809
1,158
3,901
2,511
1,390
4,689
3,006
1,683
6,274
2,991
3,283
66 Nonmonetary international and regional
organizations
International15
Latin American regional16
Other regional17
8,981
6,485
1,181
1,315
9,350
7,434
1,415
501
10,846
6,761
3,218
867
10,994
7,350
2,539
1,105
12,965
9,094
3,050
821
10,846
6,761
3,218
867
10,869
6,357
3,402
1,110
7,099
5,860
357
882
8,088
6,375
332
1,381
5,914
4,249
395
1,270
67
68
69
1,621
79
228
31
1,082
11. Since December 1992, has excluded Bosnia, Croatia, and Slovenia.
12. Includes the Bank for International Settlements. Since December 1992,
includes all parts of the former U.S.S.R. (except Russia), and Bosnia, Croatia,
and Slovenia.
13. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
14. Comprises Algeria, Gabon, Libya, and Nigeria.
12
15. Principally the International Bank for Reconstruction and Development.
Excludes "holdings of dollars" of the International Monetary Fund.
16. Principally the Inter-American Development Bank.
17. Asian, African, Middle Eastern, and European regional organizations,
except the Bank for International Settlements, which is included in "Other
Western Europe."
A58
International Statistics • August 1994
3.18 BANKS' OWN CLAIMS ON FOREIGNERS Reported by Banks in the United States1
Payable in U.S. Dollars
Millions of dollars, end of period
1994
1993
Area and country
1 Total, all foreigners
2 Foreign countries
3 Europe
4 Austria
5 Belgium and Luxembourg
6 Denmark
7 Finland
8 France
9 Germany
10 Greece
11 Italy
12 Netherlands
13 Norway
14 Portugal
15 Russia
16 Spain
17 Sweden
18 Switzerland
19 Turkey
20 United Kirwdom
21 Yugoslavia^
22 Other Europe and former U.S.S.R. 3 ..
1991
514,339
1992
499,437
1993
483,152
Oct.
Nov.
465,861
Mar.
470,679
477,308
474,180
475,590
467,566
475,714
472,260
474,406
114,390
720
5,169
507
699
11,705
7,364
653
8,950
3,878
738
805
2,142
3,299
3,704
7,177
1,118
53,219
470
2,073
124,655
598
6,327
600
725
11,033
7,966
669
8,477
2,821
777
918
2,005
2,688
3,608
4,535
1,565
66,989
414
1,940
129,703
489
6,761
612
570
11,481
8,164
736
7,658
2,945
531
936
1,957
2,666
3,443
8,602
1,559
68,166
376
2,051
124,693
420
6,765
8%
647
11,398
9,374
720
6,370
2,575
598
846
1,857
1,859
3,313
5,577
1,542
67,318
386
2,232
Jan.
468,770
483,152
480,747
121,036
413
6,535
382
598
11,490
7,683
679
8,876
3,064
396
720
2,295
2,763
4,100
6,567
1,287
60,930
536
1,722
508,056
494,355
480,747
464,618
466,569
114,310
327
6,158
686
1,907
15,112
3,371
553
8,242
2,546
669
344
1,970
1,881
2,335
4,540
1,063
60,395
825
1,386
123,377
331
6,404
707
1,418
14,723
4,222
717
9,047
2,468
355
325
3,147
2,755
4,923
4,717
962
63,430
569
2,157
121,036
413
6,535
382
598
11,490
7,683
679
8,876
3,064
396
720
2,295
2,763
4,100
6,567
1,287
60,930
536
1,722
124,593
568
5,516
1,056
730
11,516
7,570
592
8,035
3,163
779
826
2,581
4,747
4,111
4,647
1,638
64,044
535
1,939
120,650
501
5,911
1,261
606
11,622
6,961
684
8,402
3,607
598
787
2,295
4,388
3,531
5,946
1,790
59,403
549
1,808
Apr.p
Feb/
Dec.
15,113
13,845
18,432
15,697
15,478
18,432
19,126
16,864
16,984
17,953
24 Latin America and Caribbean
25 Argentina
26 Bahamas
27 Bermuda
28 Brazil
29 British West Indies
30 Chile
31 Colombia
32 Cuba
33 Ecuador
34 Guatemala
35 Jamaica
36 Mexico
37 Netherlands Antilles
38 Panama
39 Peru
40 Uruguay
41 Venezuela
42 Other
246,137
5,869
87,138
2,270
11,894
107,846
2,805
2,425
0
1,053
228
158
16,567
1,207
1,560
739
599
2,516
1,263
218,078
4,958
60,835
5,935
10,773
101,507
3,397
2,750
0
884
262
162
14,991
1,379
4,654
730
936
2,525
1,400
223,967
4,425
65,045
8,032
11,803
97,930
3,614
3,179
0
673
286
195
15,833
2,367
2,913
651
951
2,904
3,166
212,002
4,390
60,350
8,915
11,675
90,041
3,857
2,957
0
707
269
175
16,155
3,310
2,491
636
926
2,815
2,333
216,687
4,518
63,242
7,565
11,677
92,621
3,728
3,040
0
704
286
186
16,073
3,048
2,625
620
918
3,054
2,782
223,967
4,425
65,045
8,032
11,803
97,930
3,614
3,179
0
673
286
195
15,833
2,367
2,913
651
951
2,904
3,166
226,041
4,569
66,411
10,234
12,719
94,348
3,546
3,241
0
679
316
180
16,466
3,115
2,843
693
793
2,763
3,125
226,303
4,459
65,439
9,969
12,841
95,230
3,763
3,053
2
722
294
176
16,902
3,093
2,983
726
742
2,709
3,200
219,723
4,640
66,020
8,342
12,916
91,780
3,640
3,057
0
703
289
163
16,162
2,391
2,490
751
530
2,662
3,187
219,528
5,133
66,234
8,837
11,455
91,343
3,455
3,263
0
679
273
191
16,267
2,749
2,538
807
491
2,532
3,281
43 Asia
China
44
People's Republic of China
45
Republic of China (Taiwan)
46 Hong Kong
47 India
48 Indonesia
49 Israel
50 Japan
51 Korea (South)
52 Philippines
53 Thailand
54 Middle Eastern oil-exporting countries4
55 Other
125,262
131,789
110,684
105,497
107,541
110,684
101,406
101,516
98,839
105,222
747
2,087
9,617
441
952
860
84,807
6,048
1,910
1,713
8,284
7,796
906
2,046
9,642
529
1,189
820
79,172
6,179
2,145
1,867
18,540
8,754
2,299
2,628
10,864
589
1,522
826
59,576
7,556
1,408
2,154
14,398
6,864
773
1,674
9,640
635
1,268
752
60,283
7,133
1,168
2,145
13,580
6,446
706
2,003
10,449
657
1,474
787
59,934
7,148
1,265
2,110
13,853
7,155
2,299
2,628
10,864
589
1,522
826
59,576
7,556
1,408
2,154
14,398
6,864
881
2,611
10,224
638
1,556
947
54,164
7,373
1,132
2,375
12,903
6,602
842
1,487
9,990
664
1,532
798
54,583
7,518
1,183
2,543
13,190
7,186
796
2,159
11,666
737
1,605
664
49,771
7,479
1,307
2,658
14,153
5,844
843
1,815
9,903
684
1,506
676
54,905
7,441
924
2,638
16,387
7,500
56 Africa
57 Egypt
58 Morocco
59 South Africa
60 Zaire
61 Oil-exporting countries5
62 Other
4,928
294
575
1,235
4
1,298
1,522
4,279
186
441
1,041
4
1,002
1,605
3,819
196
444
633
4
1,128
1,414
3,919
160
433
663
3
1,187
1,473
3,799
218
437
664
4
1,119
1,357
3,819
196
444
633
4
1,128
1,414
3,746
198
489
581
4
1,169
1,305
3,775
227
521
558
6
1,197
1,266
3,691
205
511
565
4
1,210
1,196
3,673
206
465
557
5
1,207
1,233
63 Other
64 Australia
65 Other
2,306
1,665
641
2,987
2,243
744
2,809
2,072
737
2,910
2,401
509
2,414
1,873
541
2,809
2,072
737
2,857
2,030
827
2,601
1,692
909
3,320
1,684
1,636
3,337
1,859
1,478
66 Nonmonetary international
and regional
organizations6
6,283
5,082
2,405
1,243
2,201
2,405
3,113
1,594
1,920
1,184
23 Canada
1. Reporting banks include all types of depository institutions, as well as some
brokers and dealers.
2. Since December 1992, has excluded Bosnia, Croatia, and Slovenia.
3. Includes the Bank for International Settlements. Since December 1992,
includes all parts of the former U.S.S.R. (except Russia), and Bosnia, Croatia,
and Slovenia.
4. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
5. Comprises Algeria, Gabon, Libya, and Nigeria.
6. Excludes the Bank for International Settlements, which is included in
"Other Western Europe."
Nonbank-Reported
3.19 BANKS' OWN AND DOMESTIC CUSTOMERS' CLAIMS ON FOREIGNERS
United States1
Payable in U.S. Dollars
Data
Reported by Banks in the
Millions of dollars, end of period
1993
Claim
1991
1992
1994
1993
Oct.
Nov.
465,861
31,320
269,968
91,888
43,777
48,111
72,685
468,770
29,761
279,876
92,030
44,005
48,025
67,103
Dec.
Jan.
Feb/
Mar.
470,679
30,677
275,478
90,994
40,662
50,332
73,530
477,308
26,554
273,611
97,724
45,813
51,911
79,419
1 Total
579,683
559,495
523,562
2 Banks' claims
3 Foreign public borrowers
4 Own foreign offices
5 Unaffiliated foreign banks
6
Deposits
7
Other
8 All other foreigners
514,339
37,126
318,800
116,602
69,018
47,584
41,811
499,437
31,367
303,991
109,342
61,550
47,792
54,737
483,152
28,814
286,848
98,018
46,875
51,143
69,472
65,344
15,280
60,058
15,452
40,410
9,619
40,410
9,619
47,783
14,022
37,125
31,474
17,155
17,155
20,340
12,939
13,132
13,636
13,636
13,421
8,974
8,655
7,871
7,871
7,562
43,024
36,213
22,733
9 Claims of banks' domestic customers 3 ...
10 Deposits
11 Negotiable and readily
transferable
instruments4
12 Outstanding collections and other
claims
523,562
MEMO
13 Customer liability on acceptances
14 Dollar deposits in banks abroad,
reported by nonbanking business
enterprises in the United States
27,002
21,830
483,152
28,814
286,848
98,018
46,875
51,143
69,472
22,733
Apr."
521,963
21,622
474,180
25,731
280,469
94,439
44,050
50,389
73,541
21,284
21,863
475,590
25,121
280,072
96,608
47,907
48,701
73,789
n.a.
foreign bank, and foreign branches, agencies, or wholly owned subsidiaries of
head office or parent foreign bank.
3. Assets held by reporting banks in the accounts of their domestic customers.
4. Principally negotiable time certificates of deposit and bankers acceptances.
5. Includes demand and time deposits and negotiable and nonnegotiable
certificates of deposit denominated in U.S. dollars issued by banks abroad. For
description of changes in data reported by nonbanks, see Federal Reserve
Bulletin, vol. 65 (July 1979), p. 550.
1. For banks' claims, data are monthly; for claims of banks' domestic customers, data are quarterly.
Reporting banks include all types of depository institution, as well as some
brokers and dealers.
2. For U.S. banks, includes amounts due from own foreign branches and
foreign subsidiaries consolidated in Consolidated Report of Condition filed with
bank regulatory agencies. For agencies, branches, and majority-owned subsidiaries of foreign banks, consists principally of amounts due from head office or parent
3.20 BANKS' OWN CLAIMS ON UNAFFILIATED FOREIGNERS
Payable in U.S. Dollars
Reported by Banks in the United States1
Millions of dollars, end of period
1994
1993
Maturity, by borrower and area2
1 Total
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
By borrower
Maturity of one year or less
Foreign public borrowers
All other foreigners
Maturity of more than one year
Foreign public borrowers
All other foreigners
By area
Maturity of one year or less
Europe
Canada
Latin America and Caribbean
Asia
Africa 3
All other
Maturity of more than one year
Europe
Canada
Latin America and Caribbean
Asia
Africa 3
All other
1990
1991
June
Sept.
Dec.
Mar."
206,903
195,302
195,119
182,975
189,716
194,838
192,894
165,985
19,305
146,680
40,918
22,269
18,649
162,573
21,050
141,523
32,729
15,859
16,870
163,325
17,813
145,512
31,794
13,266
18,528
154,312
17,962
136,350
28,663
11,255
17,408
162,005
21,211
140,794
27,711
10,507
17,204
166,288
17,447
148,841
28,550
10,828
17,722
166,092
15,885
150,207
26,802
9,555
17,247
49,184
5,450
49,782
53,258
3,040
5,272
51,835
6,444
43,597
51,059
2,549
7,089
53,300
6,091
50,376
45,709
1,784
6,065
54,372
7,893
48,552
38,654
1,712
3,129
57,238
9,833
51,619
37,624
1,916
3,775
56,273
7,564
56,686
40,274
1,783
3,708
58,831
7,274
58,586
35,817
1,604
3,980
3,859
3,290
25,774
5,165
2,374
456
3,878
3,595
18,277
4,459
2,335
185
5,367
3,287
15,312
5,038
2,380
410
4,579
2,909
13,828
4,808
2,050
489
4,433
2,549
13,519
4,732
2,049
429
4,327
2,553
13,877
5,412
1,934
447
3,779
2,555
13,313
4,705
2,001
449
1. Reporting banks include all kinds of depository institutions besides commercial banks, as well as some brokers and dealers.
1992
2. Maturity is time remaining to maturity,
3. Includes nonmonetary international and regional organizations.
A59
A60
International Statistics • August 1994
3.21 CLAIMS ON FOREIGN COUNTRIES
Held by U.S. and Foreign Offices of U.S. Banks1
Billions of dollars, end of period
1992
Area or country
1990
1994
1993
1991
Mar.
June
Sept.
Dec.
Mar.
June
Sept.
Dec.
Mar.p
320.1
343.6
351.7
358.7
344.5
346.5
361. l r
377.0r
388.1
403.7r
496.7
132.2
5.9
10.4
10.6
5.0
3.0
2.2
4.4
60.9
5.9
24.0
137.6
6.0
11.0
8.3
5.6
4.7
1.9
3.4
68.5
5.8
22.6
130.9
5.3
10.0
8.4
5.4
4.3
2.0
3.2
64.7
6.5
21.1
135.6
6.2
11.9
8.8
8.0
3.3
1.9
4.6
65.6
6.5
18.7
136.0
6.2
15.3
10.9
6.4
3.7
2.2
5.2
61.0
6.3
18.9
132.9
5.6
15.3
9.3
6.5
2.8
2.3
4.8
60.8
6.3
19.3
142.4
6.1
13.5
9.9
6.7
3.6
3.0
5.3
65.7
8.2
20.4
iso.o1
7.0
14.0
10.8
7.9
3.7
2.5
4.7
73.5
8.<y
17.9
153.3r
7.1
12.3
12.4
8.7
3.7
2.5
5.6
74.7
9.7
16.8r
161 .(P
7.4
11.7
12.6
7.6
4.7
2.5
5.9
84.5rr
6.7
17.4
177.8
8.0
16.4
28.7
15.5
4.1
2.8
6.3
69.8
7.7
18.5
13 Other industrialized countries
14 Austria
15 Denmark
16 Finland
17 Greece
18 Norway
19 Portugal
20 Spain
21 Turkey
22 Other Western Europe
23 South Africa
24 Australia
22.9
1.4
1.1
.7
2.7
1.6
.6
8.3
1.7
1.2
1.8
1.8
22.8
.6
.9
.7
2.6
1.4
.6
8.3
1.4
1.8
1.9
2.7
21.4
.8
.8
.8
2.3
1.5
.5
7.7
1.2
1.5
1.8
2.3
25.5
.8
1.3
.8
2.8
1.7
.5
10.1
1.5
2.0
1.7
2.2
25.0
.7
1.5
1.0
3.0
1.6
.5
9.7
1.5
1.5
1.7
2.3
24.0
1.2
.9
.7
3.0
1.2
.4
8.9
1.3
1.7
1.7
2.9
25.4
1.2
.8
.7
2.7
1.8
.7
9.5
1.4
2.0
1.6
2.9
27.2
1.3
1.0
.9
3.1
1.8
.9
10.5
2.1
1.7
1.3
2.5
26.0
.6
1.1
.6
3.2
2.1
1.0
9.3
2.1
2.2
1.2
2.8
24.6
.4
1.0
.4
3.2
1.7
.8
8.9
2.1
2.6
1.1
2.3
41.2
1.0
1.1
1.0
3.8
1.6
1.2
12.3
2.4
3.0
1.2
12.7
25 OPEC2
26 Ecuador
27 Venezuela
28 Indonesia
29 Middle East countries
30 African countries
12.8
1.0
5.0
2.7
2.5
1.7
14.5
.7
5.4
2.7
4.2
1.5
15.8
.7
5.4
3.0
5.3
1.4
16.2
.7
5.3
3.0
5.9
1.4
15.9
.7
5.4
3.0
5.4
1.4
16.1
.6
5.2
3.0
6.2
1.1
16.8
.6
5.3
3.1
6.6
1.1
15.9
.6
5.6
3.1
5.4
1.1
14.9
.5
5.6
2.8
4.9
1.1
16.7r
.5
5.r
3.2
6.7
1.2
22.1
.5
4.7
3.0
12.8
1.0
31 Non-OPEC developing countries
65.4
63.9
69.7
68.1
72.8
72.1
74.4
76.6
77.(f
82.5
93.6
5.0
14.4
3.5
1.8
13.0
.5
2.3
4.8
9.6
3.6
1.7
15.5
.4
2.1
5.0
10.8
3.9
1.6
17.7
.4
2.2
5.1
10.6
4.0
1.6
16.3
.4
2.2
6.2
10.8
4.2
1.7
17.1
.5
2.5
6.6
10.8
4.4
1.8
16.0
.5
2.6
7.0
11.6
4.6
1.9
16.8
.4
2.6
6.6
12.3
4.6
1.9
16.8
.4
2.7
7.2
11.7r
4.7
2.0
17.5
.3
2.6
7.7
12.0
4.7
2.1
17.7
.4
3.0
8.6
12.5
5.1
2.2
18.7
.5
2.6
1 Total
2 G-10 countries and Switzerland
3 Belgium and Luxembourg
4 France
5 Germany
6 Italy
7 Netherlands
8 Sweden
9 Switzerland
10 United Kingdom
11 Canada
12 Japan
32
33
34
35
36
37
38
Latin America
Argentina
Brazil
Chile
Colombia
Mexico
Peru
Other
39
40
41
42
43
44
45
46
47
Asia
China
Peoples Republic of China
Republic of China (Taiwan)
India
Israel
Korea (South)
Malaysia
Philippines
Thailand
Other Asia
.2
3.5
3.3
.5
6.2
1.9
3.8
1.5
1.7
.3
4.1
3.0
.5
6.8
2.3
3.7
1.7
2.0
.3
4.8
3.6
.4
6.9
2.5
3.6
1.7
2.3
.3
4.6
3.8
.4
6.9
2.7
3.1
1.9
2.5
.3
5.0
3.6
.4
7.4
3.0
3.6
2.2
2.7
.7
5.2
3.2
.4
6.6
3.1
3.6
2.2
2.7
.6
5.3
3.1
.5
6.5
3.4
3.4
2.2
2.7
1.6
5.9
3.1
.4
6.9
3.7
2.9
2.4
2.6
.5
6.4
2.9
.4
6.5
4.1
2.6
2.8
3.0
2.0
7.3
3.2
.5
6.7
4.4
3.1
3.1
2.9
.8
7.5
3.9
.4
13.9
5.2
3.4
2.9
3.1
48
49
50
51
Africa
Egypt
Morocco
Zaire
Other Africa*
.4
.8
.0
1.0
.4
.7
.0
.7
.3
.7
.0
.7
.5
.7
.0
.6
.3
.6
.0
.9
.2
.6
.0
1.0
.2
.5
.0
.8
.2
.6
.0
.9
.2
.6
.0
.8
.4
.6
.0
.8
.4
.7
.0
1.0
52 Eastern Europe
53 Russia4 5
54 Yugoslavia
55 Other
2.3
.2
1.2
.9
2.4
.9
.9
.7
2.9
1.4
.8
.6
3.0
1.7
.7
.6
3.1
1.8
.7
.7
3.1
1.9
.6
.6
2.9
1.7
.6
.7
3.2
1.9
.6
.7
3.0
1.7
.6
.7
3.0
1.6
.6
.9
3.3
1.5
.5
1.4
56 Offshore banking centers
57 Bahamas
58 Bermuda
59 Cayman Islands and other British West Indies
60 Netherlands
Antilles
61 Panama6
62 Lebanon
63 Hong Kong
64 Singapore
65 Other'
44.7
2.9
4.4
11.7
7.9
1.4
.1
9.7
6.6
.0
54.2
11.9
2.3
15.8
1.2
1.4
.1
14.4
7.1
.0
63.0
15.3
3.9
18.6
1.0
1.6
.1
14.0
8.5
.0
61.4
12.9
5.1
19.3
.8
1.9
.1
14.9
6.4
.0
54.5
8.9
3.8
16.9
.7
2.0
.1
15.2
6.8
.0
58.3
6.9
6.2
21.8
1.1
1.9
.1
13.8
6.5
.0
60.1
9.6
4.1
17.6
1.6
2.0
.1
16.7
8.4
.0
57.8
6.9
4.5
15.6
2.5
2.1
.1
16.9
9.3
.0
67.5
12.4
5.5
15.1
2.8
2.1
.1
19.1
10.4
.0
72.5r
12.6
8.1
16.9r
2.3
2.4
.1
18.7
11.2
.1
79.7
15.4
8.4
16.7
2.7
2.0
.1
21.7
12.7
.0
66 Miscellaneous and unallocated8
39.9
48.0
47.8
48.6
36.8
39.7
38.8
46.2
46.3
43.3
78.7
1. The banking offices covered by these data include U.S. offices and foreign
branches of U.S. banks, including U.S. banks that are subsidiaries of foreign
banks. Offices not covered include U.S. agencies and branches of foreign banks.
Beginning March 1994, the data include large foreign subsidiaries of U.S. banks.
The data also include other types of U.S. depository institutions as well as some
types of brokers and dealers. To eliminate duplication, the data are adjusted to
exclude the claims on foreign branches held by a U.S. office or another foreign
branch of the same banking institution.
2. Organization of Petroleum Exporting Countries, shown individually; other
members of OPEC (Algeria, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar,
Saudi Arabia, and United Arab Emirates); and Bahrain and Oman (not formally
members of OPEC).
3. Excludes Liberia. Beginning March 1994 includes Namibia.
4. As of December 1992, excludes other republics of the former Soviet Union.
5. As of December 1992, excludes Croatia, Bosnia and Hercegovinia, and
Slovenia.
6. Includes Canal Zone.
7. Foreign branch claims only.
8. Includes New Zealand, Liberia, and international and regional
organizations.
Nonbank-Reported
Data
A61
3.22 LIABILITIES TO UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in
the United States1
Millions of dollars, end of period
1993
1992
Type of liability and area or country
1990
1991
1992
Sept.
Dec.
Mar.
June
Sept.
Dec.
1 Total
46,043
44,708
45,351
47,089
45,351
46,181
46,424
48,674
49,452
2 Payable in dollars
3 Payable in foreign currencies
40,786
5,257
39,029
5,679
37,209
8,142
38,344
8,745
37,209
8,142
37,823
8,358
37,014
9,410
39,280
9,394
37,803
11,649
By type
4 Financial liabilities
5 Payable in dollars
6 Payable in foreign currencies
21,066
16,979
4,087
22,518
18,104
4,414
23,380
16,623
6,757
24,518
17,453
7,065
23,380
16,623
6,757
23,947
17,021
6,926
24,714
16,870
7,844
26,067
18,635
7,432
27,445
18,112
9,333
7 Commercial liabilities
8 Trade payables
9 Advance receipts and other liabilities
24,977
10,683
14,294
22,190
9,252
12,938
21,971
9,886
12,085
22,571
10,234
12,337
21,971
9,886
12,085
22,234
10,005
12,229
21,710
9,687
12,023
22,607
9,483
13,124
22,007
9,007
13,000
23,807
1,170
20,925
1,265
20,586
1,385
20,891
1,680
20,586
1,385
20,802
1,432
20,144
1,566
20,645
1,962
19,691
2,316
10,978
394
975
621
1,081
545
6,357
12,003
216
2,106
682
1,056
408
6,528
13,101
414
1,608
810
606
569
8,424
14,334
256
2,785
738
980
627
8,146
13,101
414
1,608
810
606
569
8,424
13,461
306
1,610
820
639
503
9,029
14,060
268
2,216
787
585
491
9,058
16,341
278
2,074
779
573
378
11,669
17,862
175
2,323
902
534
634
12,690
229
292
516
345
516
576
492
663
859
3,359
1,148
0
18
1,533
17
5
10
11
12
13
14
15
16
17
18
19
Payable in dollars
Payable in foreign currencies
By area or country
Financial liabilities
Europe
Belgium and Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
20
21
22
23
24
25
26
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
4,153
371
0
0
3,160
5
4
4,784
537
114
6
3,524
7
4
4,053
369
114
19
2,860
12
6
3,997
230
115
18
2,933
12
5
4,053
369
114
19
2,860
12
6
4,299
521
114
18
2,970
13
5
4,199
426
124
18
2,951
11
5
3,719
1,301
114
18
1,600
15
5
27
28
29
Asia
Japan
Middle East oil-exporting countries2
5,295
4,065
5
5,381
4,116
13
5,676
4,608
19
5,752
4,678
17
5,676
4,608
19
5,550
4,539
24
5,793
4,611
19
5,194
4,165
23
5,203
4,134
23
30
31
Africa
Oil-exporting countries3
2
0
6
4
6
0
5
0
6
0
6
0
130
123
132
124
133
123
All other4
409
52
28
85
28
55
40
18
29
32
10,310
275
1,218
1,270
844
775
2,792
8,701
248
1,039
1,052
710
575
2,297
7,377
296
697
717
535
349
2,503
7,478
173
756
851
601
482
2,268
7,377
296
697
717
535
349
2,503
6,985
262
705
650
537
471
2,117
6,801
267
773
603
577
440
2,185
7,045
255
640
571
601
535
2,319
6,815
240
648
684
687
375
2,053
1,261
1,014
1,002
1,114
1,002
1,005
941
847
881
1,759
4
340
214
36
577
173
1,661
21
348
216
26
485
126
33
34
35
36
37
38
39
40
Commercial liabilities
Europe
Belgium and Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
41
42
43
44
45
46
47
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
1,672
12
538
145
30
475
130
1,355
3
310
219
107
307
94
1,532
3
307
209
33
457
142
1,515
3
325
121
85
326
147
1,532
3
307
209
33
457
142
1,776
11
429
236
34
553
171
1,828
6
356
226
16
659
172
48
49
50
Asia
Japan
y<
Middle Eastern oil-exporting countries^
9,483
3,651
2,016
9,334
3,721
1,498
10,917
3,951
1,889
11,026
3,918
1,813
10,917
3,951
1,889
11,067
4,035
1,796
10,823
3,715
1,815
11,736
4,546
1,934
11,613
5,090
1,543
51
52
Africa
.
Oil-exporting countries3
844
422
715
327
568
309
675
335
568
309
675
322
665
378
641
320
445
153
53
Other4
1,406
1,071
575
763
575
726
652
579
592
1 For a description of the changes in the international statistics tables, see
Federal Reserve Bulletin, vol. 65, (July 1979), p. 550.
2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
3. Comprises Algeria, Gabon, Libya, and Nigeria.
4. Includes nonmonetary international and regional organizations.
5. Revisions include a reclassification of transactions, which also affects the
totals for Asia and the grand totals.
A62
International Statistics • August 1994
3.23 CLAIMS ON UNAFFILIATED FOREIGNERS
the United States1
Reported by Nonbanking Business Enterprises in
Millions of dollars, end of period
1992
Type, and area or country
1990
1991
1993
1992
Sept.
Dec.
Mar.
June
Sept.
Dec.
1 Total
35,348
45,262
41,894
46,271
41,894
45,784
41,470
42,003
42,689"
2 Payable in dollars
3 Payable in foreign currencies
32,760
2,589
42,564
2,698
39,287
2,607
43,297
2,974
39,287
2,607
42,904
2,880
38,346
3,124
38,732
3,271
39,113"
3,576"
By type
4 Financial claims
5 Deposits
6
Payable in dollars
7
Payable in foreign currencies
8 Other financial claims
9
Payable in dollars
10
Payable in foreign currencies
19,874
13,577
12,552
1,025
6,297
5,280
1,017
27,882
20,080
19,080
1,000
7,802
6,910
892
23,532
15,100
14,302
798
8,432
7,667
765
28,573
19,524
18,387
1,137
9,049
8,028
1,021
23,532
15,100
14,302
798
8,432
7,667
765
26,064
16,508
15,450
1,058
9,556
8,803
753
21,808
11,646
10,728
918
10,162
9,238
924
23,324
13,286
12,307
979
10,038
9,279
759
23,166"
13,049"
12,215"
834"
10,117"
9,125"
992"
11 Commercial claims
12 Trade receivables
13 Advance payments and other claims
15,475
13,657
1,817
17,380
14,468
2,912
18,362
15,804
2,558
17,698
14,755
2,943
18,362
15,804
2,558
19,720
17,364
2,356
19,662
17,180
2,482
18,679
15,698
2,981
19,523"
16,308"
3,215"
14
15
14,927
548
16,574
806
17,318
1,044
16,882
816
17,318
1,044
18,651
1,069
18,380
1,282
17,146
1,533
17,773"
1,750
9,645
76
371
367
265
357
7,971
13,441
13
269
283
334
581
11,534
9,310
8
762
326
515
490
6,234
11,301
16
768
292
750
587
8,078
9,310
8
762
326
515
490
6,234
10,321
6
905
388
544
478
6,968
9,620
13
781
383
499
460
6,550
8,251
9
708
361
485
454
5,227
8,042
131
749
472
483
506
4,538"
16
17
18
19
20
21
22
Payable in dollars
Payable in foreign currencies
By area or country
Financial claims
Europe
Belgium and Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
23
Canada
2,934
2,642
1,709
2,281
1,709
2,007
1,781
1,593
1,851"
24
25
26
27
28
29
30
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
6,201
1,090
3
68
4,635
177
25
10,717
827
8
351
9,056
212
40
11,122
658
40
686
9,266
286
29
13,837
1,248
65
589
11,492
239
26
11,122
658
40
686
9,266
286
29
9,718
320
79
592
8,266
235
23
6,704
697
258
590
4,650
270
24
10,067
494
197
590
8,109
385
25
10,918"
496"
125
599
8,620"
634
161
31
32
33
Asia
Japan
Middle East oil-exporting countries2
860
523
8
640
350
5
807
643
3
717
471
4
807
643
3
3,263
3,066
3
2,961
2,444
10
2,709
2,199
5
1,779"
1,063
3
34
35
Africa
Oil-exporting countries3
37
0
57
1
79
9
71
1
79
9
128
1
125
1
88
1
99
1
36
All other4
195
385
505
366
505
627
617
616
477
7,044
212
1,240
807
555
301
1,775
8,193
194
1,585
955
645
295
2,086
8,401
189
1,525
931
551
362
2,081
8,196
174
1,825
900
589
308
2,011
8,401
189
1,525
931
551
362
2,081
8,744
170
1,476
974
730
436
2,326
8,885
172
1,488
979
560
442
2,514
7,975
163
1,394
898
399
376
2,213
37
38
39
40
41
42
43
Commercial claims
Europe
Belgium and Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
8,422"
182
1,755"
953
387
417
2,176
44
Canada
1,074
1,121
1,258
1,155
1,258
1,312
1,330
1,326
1,284
45
46
47
48
49
50
51
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
2,375
14
246
326
40
661
192
2,655
13
264
427
41
842
203
3,024
28
255
356
40
920
344
3,225
12
256
410
43
977
307
3,024
28
255
356
40
920
344
3,431
18
195
834
17
985
341
3,414
17
239
786
43
898
314
3,023
20
225
406
39
848
282
3,148"
11
173
442
69
925
293
52
53
54
Asia
Japan
Middle Eastern oil-exporting countries
4,127
1,460
460
4,591
1,899
620
4,764
1,879
682
4,328
1,779
513
4,764
1,879
682
5,360
2,145
761
5,113
1,853
659
5,439
2,496
446
5,699"
2,346"
645
55
56
Africa
Oil-exporting countries
488
67
430
95
552
78
439
60
552
78
457
75
510
98
487
107
488
71
57
Other4
367
390
363
355
363
416
410
429
482"
1. For a description of the changes in the international statistics tables, see
Federal Reserve Bulletin, vol. 65, (July 1979), p. 550.
2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
3. Comprises Algeria, Gabon, Libya, and Nigeria.
4. Includes nonmonetary international and regional organizations.
Securities Holdings and Transactions
A63
3.24 FOREIGN TRANSACTIONS IN SECURITIES
Millions of dollars
1994
Transaction and area or country
1992
1994
1993
1993
Jan.Apr.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.r
Apr.P
U.S. corporate securities
STOCKS
1 Foreign purchases
2 Foreign sales
221,367
226,503
319,449
297,913
132,820
128,406
32,350
27,840
31,924
28,755
32,843
28,362
32,238
28,965
34,428
30,709
36,340
37,079
29,814
31,653
3 Net purchases or sales (—)
-5,136
21,536
4,414
4,510
3,169
4,481
3,273
3,719
-739
-1,839
21,264
4,485
4,598
3,099
4,457
3,273
3,786
-737
-1,837
-4,927
-1,350
-80
-262
168
-3,301
1,407
2,203
-88
-3,943
-3,598
10
169
10,615
-103
1,647
-603
2,986
4,510
-3,213
5,709
-311
8,199
3,826
63
202
7,545
-361
2,194
306
1,011
2,387
261
-35
-49
-3,779
-2,025
39
503
3,095
198
328
134
409
1,709
-300
1,245
-77
602
349
5
28
1,407
45
130
-767
205
1,470
11
941
53
601
488
6
80
2,415
61
266
183
338
1,078
-110
1,058
11
965
681
20
98
2,951
119
1,170
169
254
614
314
948
-100
-911
-800
10
61
3,447
190
440
210
505
1,215
-284
910
-17
-379
-447
-17
126
379
-587
332
-155
79
389
-59
-31
64
-1,295
-117
13
192
768
-83
252
82
173
169
290
-1,862
4
-1,194
-661
33
124
33
272
-71
-88
70
24
0
-67
-2
-2
214,922
175,842
283,745
217,481
107,632
90,082
27,565
18,938
28,947
21,545
28,395
17,427
24,607
19,418
30,384
25,147
30,370
27,254
39,080
66,264
17,550
8,627
7,402
10,968
5,189
4,008r
5,237
3,116
3,9771
5,150
3,131
2,1(A1
-57
90
99
57r
2,799
-141
909
-83
480
37
10
38
2,647
32
-64
330
131
3,036
101
1,850
59
417
-363
-10
86
885
489
47
391
-123
582
276
875
7
903
523
55
130
87
-15
-6,248
38,374
44,622
—4,756rr
85,903
90,659r
-5,985
37,067
43,052
5,194
118,674
113,480
-1,066
33,031
34,097
-5,829
68,056
73,885
-ll,004 r
-791
-6,895
— 15,386 —10,872r
-768
-6,851
4 Foreign countries
5
6
7
8
9
10
11
12
13
14
15
16
17
-5,169
Europe
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
Latin America and Caribbean
Middle East*
Other Asia
Japan
Africa
Other countries
18 Nonmonetary international and
regional organizations
BONDS 2
19 Foreign purchases
20 Foreign sales
21 Net purchases or sales ( - )
22 Foreign countries
37,964
65,726
17,463
8,488
7,375
10,901
5,205
23
24
25
26
27
28
29
30
31
32
33
34
35
17,435
1,203
2,480
540
-579
12,421
237
9,300
3,166
7,545
-450
354
-73
22,055
2,346
883
-290
-627
19,158
1,653
16,493
3,257
20,846
11,569
1,149
273
9,038
517
-28
895
241
8,093
259
5,272
144
2,470
102
4
276
3,973
512
913
-518
203
2,666
95
1,727
375
2,256
1,574
47
15
1,534
110
-231
49
-80
2,300
54
2,650
432
2,765
1,478
-2
-58
3,118
145
-62
95
28
2,853
319
3,681
383
3,137
2,477
119
144
2,742
53
-101
75
176
1,676
23
1,638
161
670
-95
-51
22
1,116
538
87
139
27
67
-16
Europe
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
Latin America and Caribbean
Middle East1
Other Asia
Japan
Africa
Other countries
36 Nonmonetary international and
regional organizations
22,271rr
18,263
31
Foreign securities
37 Stocks, net purchases or sales (-) 3
38 Foreign purchases
39 Foreign sales
40 Bonds, net purchases or sales ( - )
41 Foreign purchases
42 Foreign sales
-32,259
150,051
182,310
-15,605
513,589
529,194
-63,320
246,011
309,331
-61,023
839,118
900,141
-19,159
140,904
160,063
-14,874
356,856
371,730
-7,474
24,740
32,214
-2,479
76,034
78,513
-6,931
28,408
35,339
-54
87,459
87,513
-6,503
31,135
37,638
-8,158
79,334
87,492
-5,860
32,432
38,292
-9,483 r
84,223r
93,706
43 Net purchases or sales (—), of stocks and bonds
-47,864 -124,343
-34,033
-9,953
-6,985
-14,661
-15,343r
r
44 Foreign countries
-51,274 -124,504
-33,877
-10,302
-6,994
-14,691
45
46
47
48
49
50
-31,350
-6,893
-4,340
-7,923
-13
-755
-81,175
-14,649
-9,549
-15,044
-185
-3,902
-1,243
-4,762
-13,417
-13,637
-188
-630
-5,004
-949
-1,280
-2,002
14
-1,081
-4,530
709
-2,248
-502
-423
-4,351
-1,733
-4,566
-3,555
13
-499
-5,512
-2,741r
-3,124 r
-3,171
-60
-778
-3,568 r
-2,416
-327
-4,449 r
18
-130 r
8,082
648
-3,314
-6,598
-118
532
-245
-253
-6,652
581
-28
-254
3,410
161
-156
349
9
30
43
-132
-23
-44
Europe
Canada
Latin America and Caribbean
Asia
Africa
Other countries
51 Nonmonetary international and
regional organizations
1. Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, Kuwait,
Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial States).
2. Includes state and local government securities and securities of U.S.
government agencies and corporations. Also includes issues of new debt securities sold abroad by U.S. corporations organized to finance direct investments
abroad.
0
3. In a July 1989 merger, the former stockholders of a U.S. company received
$5,453 million in shares of the new combined U.K. company. This transaction is
not reflected in the data,
A64
International Statistics • August 1994
3.25 MARKETABLE U.S. TREASURY BONDS AND NOTES
Foreign Transactions
Millions of dollars
1994
Country or area
1992
1993
1994
1993
Jan.Apr.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.r
Apr. p
Transactions, net purchases or sales ( - ) during period1
1 Estimated total
39,288
24,294
-197
3,925
15,203
507
1,853
12,995
-1,430
-13,615
2 Foreign countries
37,935
24,091
184
5,055
14,584
696
1,592
12,884
-1,446
-12,846
3
4
5
6
7
8
9
10
11
Europe
Belgium and Luxembourg
Germany
Netherlands
Sweden
Switzerland
United Kingdom
Other Europe and former U.S.S.R
Canada
19,625
1,985
2,076
-2,959
-804
488
24,184
-5,345
562
-2,311
1,218
-9,977
-515
1,421
-1,501
6,266
777
11,252
591
159
78
-314
105
2,256
-2,655
962
-1,105
3,500
-205
1,176
-506
47
448
833
1,707
-342
-841
22
-750
206
141
573
-1,900
867
1,358
499
-65
571
-189
-31
-70
-412
695
846
114
-63
2,327
52
-4
313
-1,888
-623
32
3,552
128
-1,055
418
229
555
2,455
822
168
2,281
269
-729
-971
34
1,385
688
1,605
357
-5,356
-175
-465
187
-154
3
-3,910
-842
-1,662
12
13
14
15
16
17
18
19
Latin America and Caribbean
Venezuela
Other Latin America and Caribbean
Netherlands Antilles
Asia
Japan
Africa
Other
-3,222
539
-1,956
-1,805
23,517
9,817
1,103
-3,650
-4,692
389
-5,925
844
20,532
17,070
1,156
-1,846
1,768
-176
-5,128
7,072
-374
1,451
-223
-473
3,701
-102
676
3,127
-2,034
156
74
156
2,070
19
-36
2,087
11,771
5,661
35
191
-4,830
56
-1,061
-3,825
4,029
649
115
37
3,677
-358
3,118
917
-2,152
-3,074
-135
56
7,512
235
2,860
4,417
1,191
-1,403
-120
581
-3,428
93
-4,204
683
151
2,914
-18
-789
-5,993
-146
-6,902
1,055
436
3,014
50
-321
1,353
1,018
533
203
-302
654
-381
-248
107
-1,130
-874
-23
619
855
40
-189
124
-1
261
455
7
111
1
116
16
61
-37
-769
-765
21
37,935
6,876
31,059
24,091
1,272
22,819
184
4,031
-3,847
5,055
1,619
3,436
14,584
6,223
8,361
696
3,637
-2,941
1,592
4,284
-2,692
12,884
4,045
8,839
-1,446
-4,883
3,437
-12,846
585
-13,431
4,317
11
-8,836
-5
-441
0
-820
0
-6
0
84
-9
-1,518
0
900
0
33
0
144
0
20 Nonmonetary international and regional organizations
21 International
22 Latin American regional
MEMO
23 Foreign countries
24 Official institutions
25 Other foreign2
Oil-exporting countries
26 Middle3 East 2
27 Africa
1. Official and private transactions in marketable U.S. Treasury securities
having an original maturity of more than one year. Data are based on monthly
transactions reports. Excludes nonmarketable U.S. Treasury bonds and notes
held by official institutions of foreign countries.
2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
3. Comprises Algeria, Gabon, Libya, and Nigeria.
Interest and Exchange Rates
A65
3.26 DISCOUNT RATES OF FOREIGN CENTRAL BANKS 1
Percent per year
Rate on June 30, 1994
Rate on June 30, 1994
Rate on June 30, 1994
Country
Country
Percent
Month
effective
4.5
4.5
6.92
5.0
5.1
May 1994
May 1994
June 1994
May 1994
June 1994
Austria..
Belgium .
Canada..
Denmark
France2..
Country
Germany...
Italy
Japan
Netherlands
1. Rates shown are mainly those at which the central bank either discounts or
makes advances against eligible commercial paper or government securities for
commercial banks or brokers. For countries with more than one rate applicable to
such discounts or advances, the rate shown is the one at which it is understood
that the central bank transacts the largest proportion of its credit operations.
Percent
Month
effective
4.5
7.0
1.75
4.5
May 1994
May 1994
Sept. 1993
May 1994
Norway
Switzerland
United Kingdom
Percent
Month
effective
4.75
3.5
Feb. 1994
Apr. 1994
Sept. 1992
12.0
2. Since February 1981, the rate has been that at which the Bank of France
discounts Treasury bills for seven to ten days.
3.27 FOREIGN SHORT-TERM INTEREST RATES1
Percent per year, averages of daily figures
1993
Type or country
8 Italy
1991
5.86
11.47
9.07
9.15
8.01
9.19
9.49
12.04
9.30
7.33
1992
3.70
9.56
6.76
9.42
7.67
9.25
10.14
13.91
9.31
4.39
3.18
5.88
5.14
7.17
4.79
6.73
8.30
10.09
8.10
2.96
1. Rates are for three-month interbank loans, with the following exceptions:
Canada, finance company paper; Belgium, three-month Treasury bills; and Japan,
CD rate.
1994
1993
Dec.
Jan.
Feb.
Mar.
Apr.
May
June
3.26
5.29
4.09
5.99
4.10
5.50
6.39
8.56
7.03
2.06
3.15
5.34
3.89
5.76
3.90
5.12
6.19
8.38
6.88
2.13
3.43
5.15
3.89
5.78
4.04
5.19
6.18
8.42
6.39
2.21
3.75
5.12
4.45
5.73
3.99
5.23
6.11
8.36
6.10
2.26
4.00
5.14
6.07
5.48
3.%
5.22
5.89
8.07
5.84
2.26
4.51
5.13
6.38
5.07
3.94
5.04
5.52
7.76
5.27
2.17
4.51
5.13
6.50
4.95
4.21
4.95
5.44
8.04
5.33
2.12
A66
International Statistics • August 1994
3.28 FOREIGN EXCHANGE RATES1
Currency units per dollar except as noted
1994
Country/currency unit
1
2
3
4
5
6
7
8
9
10
Australia/dollar2
Austria/schilling
Belgium/franc
Canada/dollar
.
China, P.R./yuan
Denmark/krone
.
Finland/markka
France/franc
Germany/deutsche mark
Greece/drachma
11
12
13
14
15
16
17
18
19
20
Hong Kong/dollar
India/rupee ..
Ireland/pound
Italy/lira
Japan/yen
Malaysia/ringgit
Netherlands/guilder
New Zealand/dollar2
Norway/krone
Portugal/escudo
21
22
23
24
25
26
27
28
29
30
Singapore/dollar
South Africa/rand
South Korea/won
Spain/peseta
Sri Lanka/rupee
Sweden/krona
Switzerland/franc
Taiwan/dollar
Thailand/baht
United Kingdom/pound
MEMO
31 United States/dollar3
1991
1992
1993
Feb.
Mar.
Apr.
May
June
77.872
11.686
34.195
1.1460
5.3337
6.4038
4.0521
5.6468
1.6610
182.63
73.521
10.992
32.148
1.2085
5.5206
6.0372
4.4865
5.2935
1.5618
190.81
67.993
11.639
34.581
1.2902
5.7795
6.4863
5.7251
5.6669
1.6545
229.64
69.608
12.252
36.206
1.3173
8.7219
6.7697
5.7004
5.9207
1.7426
250.29
71.611
12.200
35.768
1.3424
8.7249
6.7668
5.5930
5.8955
1.7355
250.48
71.087
11.8%
34.862
1.3644
8.7241
6.62%
5.5436
5.7647
1.6909
246.71
71.565
11.948
34.979
1.3830
8.7251
6.6642
5.4997
5.8170
1.6984
249.08
72.433
11.651
34.108
1.3808
8.6859
6.4857
5.4194
5.6728
1.6565
245.41
73.291
11.446
33.514
1.3836
8.6836
6.3786
5.4241
5.5597
1.6271
244.77
7.7712
22.712
161.39
1,241.28
134.59
2.7503
1.8720
57.832
6.4912
144.77
7.7402
28.156
170.42
1,232.17
126.78
2.5463
1.7587
53.792
6.2142
135.07
7.7357
31.291
146.47
1,573.41
111.08
2.5738
1.8585
54.127
7.0979
161.08
7.7251
31.440
143.03
1,699.45
111.44
2.7160
1.9516
56.263
7.5064
176.04
7.7353
31.449
141.91
1,685.%
106.30
2.7624
1.9464
57.436
7.4885
175.15
7.7268
31.415
143.40
1,666.63
105.10
2.7171
1.9006
57.093
7.3419
174.00
7.7269
31.391
143.42
1,626.07
103.48
2.6887
1.9074
56.908
7.3680
173.54
7.7262
31.375
147.12
1,594.56
103.75
2.6169
1.8597
58.347
7.1789
171.15
7.7309
31.385
149.54
1,592.22
102.53
2.5942
1.8242
59.121
7.0686
168.76
1.7283
2.7633
736.73
104.01
41.200
6.0521
1.4356
26.759
25.528
176.74
1.6294
2.8524
784.58
102.38
44.013
5.8258
1.4064
25.160
25.411
176.63
1.6158
3.2729
805.75
127.48
48.205
7.7956
1.4781
26.416
25.333
150.16
1.6037
3.4107
813.55
143.04
49.460
8.1184
1.4716
26.495
25.543
149.23
1.5873
3.4520
812.24
141.08
49.113
7.9869
1.4565
26.440
25.382
147.92
1.5819
3.4586
810.69
138.78
48.931
7.9156
1.4292
26.414
25.325
149.19
1.5628
3.5789
811.71
138.14
48.925
7.8850
1.4383
26.389
25.268
148.23
1.5464
3.6346
809.79
136.62
49.067
7.7181
1.4125
26.792
25.212
150.42
1.5310
3.6318
809.86
134.23
49.232
7.7968
1.3727
27.018
25.137
152.62
89.84
86.61
93.18
96.54
95.79
94.35
94.39
92.79
91.60
1. Averages of certified noon buying rates in New York for cable transfers.
Data in this table also appear in the Board's G.5 (405) monthly statistical release.
For ordering address, see inside front cover.
2. Value in U.S. cents.
3. Index of weighted-average exchange value of U.S. dollar against the
currencies of ten industrial countries. The weight for each of the ten countries is
Jan.
the 1972-76 average world trade of that country divided by the average world
trade of all ten countries combined. Series revised as of August 1978 (see Federal
Reserve Bulletin, vol. 64 (August 1978), p. 700).
67
Guide to Statistical Releases and Special Tables
STATISTICAL RELEASES—List
Published
Semiannually,
with Latest
Bulletin
Reference
Anticipated schedule of release dates for periodic releases
SPECIAL TABLES—Quarterly
Data
Published
Irregularly,
with Latest
Bulletin
Issue
June 1994
Page
A76
Issue
Page
Reference
Title and Date
Assets and liabilities of commercial banks
March 31, 1993
June 30, 1993
September 30, 1993
December 31, 1993
August
November
February
May
1993
1993
1994
1994
A70
A70
A70
A68
Terms of lending at commercial banks
August 1993
November 1993
February 1994
May 1994
November
February
May
August
1993
1994
1994
1994
A76
A76
A74
A68
Assets and liabilities of U.S. branches and agencies of foreign banks
June 30, 1993
September 30, 1993
December 31, 1993
March 31, 1994
November
February
May
August
1993
1994
1994
1994
A80
A80
A78
A72
Pro forma balance sheet and income statements for priced service operations
June 30, 1991
September 30, 1991
March 30, 1992
June 30, 1992
November
January
August
October
1991
1992
1992
1992
A80
A70
A80
A70
Assets and liabilities of life insurance companies
June 30, 1991
September 30, 1991
December 31, 1991
September 30, 1992
December
May
August
March
1991
1992
1992
1993
A79
A81
A83
A71
A68
Special Tables • August 1994
4.23 TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, May 2-6, 19941
Commercial and Industrial Loans
Characteristic
Amount of
loans
(thousands
of dollars)
Average
size
(thousands
of dollars)
Weighted
average
maturity2
Days
Loan rate (percent)
Weighted
average
effective3
Standard
Loans
secured
by
collateral
(percent)
Loans
made
under
commitment
(percent)
Participation
loans
(percent)
57.5
5.7
81.2
8.7
9.9
6.9
ALL BANKS
1 Overnight6
12,953,765
6,636
4.47
8.6
2 One month or less (excluding
overnight)
3 Fixed rate
4 Floating rate
7,644,038
4,669,477
2,974,562
1,071
2,223
591
5.09
4.63
5.82
20.4
5 More than one month and less than
one year
Fixed rate
Floating rate
9,750,253
4,335,962
5,414,292
182
187
178
5.94
5.19
6.54
50.9
39.4
60.0
80.1
80.2
7.1
6.0
7.9
8 Demand7
9 Fixed rate
10 Floating rate
17,480,228
4,593,535
12,886,692
315
606
269
5.94
4.84
6.34
66.2
42.0
74.9
63.1
60.9
63.8
4.5
4.6
4.4
11 Total short-term
47,828,284
405
54
5.41
40.2
67.9
6.0
12 Fixed rate (thousands of dollars) . . .
13 1-99
14 100-499
15 500-999
16 1,000-4,999
17 5,000-9,999
18 10,000 or more
26,552,738
449,930
429,298
469,352
4,343,805
4,875,048
15,985,305
764
26
167
116
71
34
25
18
4.68
8.01
6.54
5.65
4.98
4.73
4.41
19.8
79.9
74.0
51.8
24.0
16.2
15.7
65.0
40.6
62.9
80.6
78.9
74.6
58.6
6.3
19 Floating rate (thousands of dollars).
20 1-99
21 100-499
22 500-999
23 1,000-4,999
24 5,000-9,999
25 10,000 or more
21,275,545
1,555,979
3,219,028
2,046,157
4,629,115
1,786,904
8,038,362
126
181
194
234
141
49
66
6.32
7.59
7.35
6.51
5.55
5.25
65.5
83.2
78.8
71.9
56.7
44.6
64.9
71.5
85.8
87.0
77.5
83.7
74.4
53.4
6
7
16
182
690
2,358
6,527
18,851
255
25
202
666
2,029
6,144
23,802
152
114
183
11.1
35.0
8.12
76.1
89.1
80.0
.2
2.8
7.7
7.6
14.6
3.7
5.7
1.4
3.6
4.3
10.6
7.1
4.6
Months
26 Total long-term
6,192,762
265
6.48
51.1
65.5
27 Fixed rate (thousands of dollars) ..
28 1-99
29 100-499
30 500-999
31 1,000 or more
1,724,271
183,330
292,417
91,290
1,157,233
147
19
192
709
4,526
6.17
8.57
8.24
6.68
5.22
57.3
86.5
94.4
75.3
41.9
58.9
20.3
34.0
53.1
71.8
.6
1.1
1.1
2.0
32 Floating rate (thousands of dollars)
33 1-99
34 100-499
35 500-999
36 1,000 or more
4,468,491
246,321
724,135
499,075
2,998,960
383
35
230
680
4,437
6.61
48.8
90.2
82.9
71.7
33.3
68.0
54.4
69.0
77.8
67.3
7.6
6.4
7.8
7.8
7.7
8.24
7.67
7.43
6.08
1.7
Loan rate (percent)
Days
Effective3
Nominal8
LOANS MADE BELOW PRIME 10
37 Overnight6
38 One month or less (excluding
overnight)
39 More than one month and less than
one vear
40 Demand7
12,658,295
8,431
4.41
4.38
7.6
56.5
5.9
6,220,967
4,300
15
4.56
4.54
15.9
79.3
10.0
6,250,564
10,009,437
744
2,124
119*
4.90
4.66
4.87
4.61
35.2
55.6
85.8
42.9
9.7
4.0
41 Total short-term
35,139,264
2,188
34
4.59
4.56
27.6
61.9
42 Fixed rate
43 Floating rate
25,251,680
9,887,583
2,683
1,486
25
84
4.53
4.77
4.50
4.72
17.2
54.4
64.5
55.3
6.4
7.6
5.12
5.05
29.9
60.1
3.0
4.92
5.24
4.86
5.16
36.2
26.2
72.4
52.8
2.5
3.3
Months
44 Total long-term
2,885,723
1,016
45 Fixed rate
46 Floating rate . . .
1,082,459
1,803,264
716
1,357
Footnotes appear at the end of the table.
39
Financial Markets
4.23 TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, May 2-6, 1994—Continued
Commercial and industrial loans—Continued
Loans
secured
by
collateral
(percent)
Loans
made
under
commitment
(percent)
Participation
loans
(percent)
4.51
9.7
57.0
4.6
4.90
4.59
5.56
17.3
10.5
31.7
84.1
92.6
9.5
9.8
9.0
5.32
4.83
5.84
38.6
32.3
45.6
89.7
88.9
90.4
6.7
6.9
6.6
5.61
4.63
65.6
40.0
76.5
53.8
56.3
52.7
3.2
6.02
37
5.12
37.0
4,577
27
256
669
2,411
6,450
18,699
49
35
27
22
21
4.59
7.07
5.88
5.62
4.96
4.79
4.41
72.4
53.1
46.0
22.2
17.9
17.2
547
32
208
674
2,032
6,340
24,500
92
160
148
144
115
49
72
5.93
7.87
7.46
7.12
6.49
5.52
5.19
65.4
92.9
92.4
92.5
83.5
74.7
46.0
4.7
75.2
66.8
52.5
45.4
68.8
Amount of
loans
(thousands
of dollars)
Average
size
(thousands
of dollars)
1 Overnight6
9,888,563
6,898
2 One month or less (excluding
overnight)
3 Fixed rate
4 Floating rate
5,448,142
3,696,857
1,751,285
2,961
5,833
1,452
5 More than one month and less than
one year
6 Fixed rate
7 Floating rate
5,629,671
2,934,719
2,694,952
953
2,570
566
8 Demand7
9 Fixed rate
10 Floating rate
12,901,720
3,867,747
9,033,973
648
3,107
484
11 Total short-term
33,868,095
1,164
12 Fixed rate (thousands of dollars) . . .
13 1-99
14 100-499
15 500-999
16 1,000-4,999
17 5,000-9,999
18 10,000 or more
20,387,886
24,392
153,125
267,278
3,125,361
3,676,463
13,141,266
19 Floating rate (thousands of dollars).
20 1-99
21 100-499
22 500-999
23 1,000-4,999
24 5,000-9,999
25 10,000 or more
13,480,210
477,554
1,427,414
882,973
2,525,025
1,287,494
6,879,749
Characteristic
Weighted
average
maturity2
Days
Loan rate (percent)
Weighted
average
effective3
Standard
LARGE BANKS
121
103
139
18.8
64.5
81.6
80.1
2.8
3.3
5.2
65.7
66.5
77.0
88.8
82.5
72.6
59.1
5.5
.6
5.5
5.8
6.9
8.2
4.5
1.0
2.5
4.4
7.9
6.5
3.9
Months
3,291,341
798
6.33
48.3
90.6
8.7
27 Fixed rate (thousands of dollars) . . .
28 1-99
29 100-499
30 500-999
31 1,000 or more
749,098
10,919
25,654
39,442
673,082
1,192
31
215
719
6,608
5.05
7.89
6.97
5.78
4.89
50.2
85.4
70.5
55.5
48.6
93.2
57.3
84.8
75.2
95.2
2.3
1.6
6.7
2.5
2.1
32 Floating rate (thousands of dollars).
33 1-99
34 100-499
35 500-999
36 1,000 or more
2,542,243
48,543
304,799
272,004
1,916,897
728
39
231
690
3,566
6.70
7.61
7.44
7.22
6.49
47.7
79.6
72.6
63.3
40.7
89.8
86.0
85.9
90.5
90.4
10.6
26 Total long-term
3.0
8.1
9.4
11.4
Loan rate (percent)
Days
Effective3
Nominal8
LOANS MADE BELOW PRIME 10
37 Overnight6
38 One month or less (excluding
overnight)
39 More than one month and less than
one .year
40 Demand7
41 Total short-term
42 Fixed rate
43 Floating rate
9,596,033
8,327
4.43
4.41
8.4
55.8
4.7
4,828,688
6,000
14
4.52
4.50
12.7
83.5
10.7
4,446,036
8,562,143
3,473
3,957
109
*
4.75
4.60
4.73
4.55
60.1
29.3
91.8
35.0
7.2
2.4
27,432,899
5,079
30
4.55
4.52
60.0
5.5
5,915
3,738
22
64.8
48.0
5.7
5.0
19,677,448
7,755,452
75
4.50
4.67
4.48
4.62
17.3
57.6
5.04
4.98
41.2
94.6
4.4
4.70
5.30
4.66
5.24
44.3
38.8
94.7
94.5
2.4
5.9
Months
44 Total long-term
1,475,621
2,624
45 Fixed rate
46 Floating rate ..
646,902
828,720
3,298
2,263
Footnotes appear at the end of the table.
52
A69
A70
Special Tables • August 1994
4.23 TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, May 2-6, 1994'—Continued
Commercial and industrial loans—Continued
Weighted
average
maturity2
Loans
secured
by
collateral
(percent)
Loans
made
under
commitment
(percent)
Participation
loans
(percent)
5.1
58.8
9.3
5.57
4.79
6.19
28.1
74.0
61.1
84.2
6.7
10.4
3.8
6.79
5.94
7.23
67.6
54.4
74.3
67.1
70.1
7.6
4.2
9.3
6.89
5.93
7.07
68.0
52.3
71.0
89.3
85.6
90.0
14.1
7.1
6.09
47.8
73.6
8.0
4.95
8.07
6.90
5.68
5.02
4.56
4.39
23.2
80.4
85.6
59.5
28.7
11.3
8.7
62.9
39.2
55.1
69.8
69.7
80.7
56.2
8.9
67.2
83.8
82.1
Loan rate (percent)
Amount of
loans
(thousands
of dollars)
Average
size
(thousands
of dollars)
1 Overnight6
3,065,202
5,911
2 One month or less (excluding
overnight)
3 Fixed rate
4 Floating rate
2,195,896
972,620
1,223,277
415
663
320
5 More than one month and less than
one year
Fixed rate
Floating rate
4,120,582
1,401,243
2,719,340
86
64
106
8 Demand7
9 Fixed rate
10 Floating rate
4,578,507
725,788
3,852,719
129
115
132
11 Total short-term
13,960,188
157
6,164,852
425,539
276,172
202,073
1,218,444
1,198,585
2,844,039
203
16
157
720
2,232
6,773
19,590
39
169
155
113
51
33
10
7,795,336
1,078,425
1,791,614
1,163,184
2,104,090
499,410
1,158,614
133
23
197
659
2,025
5,693
20,361
164
185
6.99
8.24
7.69
7.53
6.54
5.65
5.60
75.8
61.7
42.3
41.8
66.1
Characteristic
Days
Weighted
average
effective3
Standard
OTHER BANKS
6
7
12 Fixed rate (thousands of dollars)
13 1-99
14 100-499
15 500-999
16 1,000-4,999
17 5,000-9,999
18 10,000 or more
19 Floating rate (thousands of dollars)...
20 1-99
21 100-499
22 500-999
23 1,000-4,999
24 5,000-9,999
25 10,000 or more
.34
1%
138
226
216
277
171
47
54
13.6
39.7
81.6
61.2
82.7
82.7
84.0
73.7
97.3
8.2
.2
1.3
10.1
9.3
34.1
.0
7.3
1.6
4.4
4.3
13.7
8.9
8.2
Months
26 Total long-term
2,901,421
6.66
54.4
37.0
2.9
27 Fixed rate (thousands of dollars) . . .
28 1-99
29 100-499
30 500-999
31 1,000 or more
975,173
172,411
266,763
51,848
484,151
18
190
702
3,147
7.02
32.6
18.0
29.1
36.2
39.3
1.2
.6
8.36
7.37
5.68
62.7
86.6
96.7
90.3
32.5
32 Floating rate (thousands of dollars).
33 1-99
34 100-499
35 500-999
36 1,000 or more
1,926,248
197,778
419,336
227,071
1,082,063
236
34
229
668
7,818
6.48
8.40
7.83
7.68
5.36
50.2
92.8
90.4
81.7
39.3
46.6
56.8
62.5
26.3
3.7
7.3
7.5
5.9
8.62
20.2
.6
.0
1.9
1.1
Loan rate (percent)
Days
Effective3
Nominal8
LOANS MADE BELOW PRIME 10
37 Overnight6
38 One month or less (excluding
overnight)
39 More than one month and less than
one vear
40 Demand7
3,062,263
8,774
4.32
4.28
5.0
58.8
9.3
1,392,280
2,169
21
4.71
4.66
27.2
64.5
7.7
1,804,529
1,447,294
253
568
144
5.29
5.02
5.24
5.00
49.8
28.4
71.2
89.4
15.7
13.0
41 Total short-term
7,706,364
723
47
4.75
4.71
23.9
68.5
11.2
42 Fixed rate
43 Floating rate
5,574,232
2,132,132
916
466
33
108
4.61
5.11
4.57
5.06
16.7
42.8
63.4
81.7
8.9
17.2
5.21
5.11
18.1
24.1
1.6
5.25
5.19
5.16
5.09
24.0
15.4
39.2
17.3
2.5
1.2
Months
44 Total long-term
45 Fixed rate
46 Floating rate ...
Footnotes appear at the end of the table.
1,410,101
619
435,557
974,544
331
1,012
25
Financial Markets
A71
4.23 TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, May 2-6, 1994—Continued
NOTES
1. The survey of terms of bank lending to business collects data on gross loan
extensions made during the first full business week in the mid-month of each
quarter by a sample of 340 commercial banks of all sizes. A sample of 250 banks
reports loans to farmers. The sample data are blown up to estimate the lending
terms at all insured commercial banks during that week. The estimated terms of
bank lending are not intended for use in collecting the terms of loans extended
over the entire quarter or residing in the portfolios of those banks. Construction
and land development loans include both unsecure loans and loans secured by real
estate. Thus, some of the construction and land development loans would be
reported on the statement of condition as real estate loans and the remainder as
business loans. Mortgage loans, purchased loans, foreign loans, and loans of less
that $1,000 are excluded from the survey. As of September 30, assets of most of
the large banks were at least $7.0 billion. For all insured banks, total assets
averaged $275 million.
2. Average maturities are weighted by loan size; excludes demand loans.
3. Effective (compounded) annual interest rate calculated from the stated rate
and other terms of the loans and weighted by loan size.
4. The chances are about two out of three that the average rate shown would
differ by less than the amount of the standard error from the average rate that
would be found by a complete survey of lending at all banks.
5. The rate used to price the largest dollar volume of loans. Base pricing rates
include the prime rate (sometimes referred to as a bank's "basic" or "reference"
rate); the federal funds rate; domestic money market rates other than the federal
funds nte; foreign money market rates; smoother base rates not included in the
foregoing classifications.
6. Overnight loans mature on the following business day.
7. Demand loans have no stated date of maturity.
8. Nominal (not compounded) annual interest rate calculated from the stated
rate and other terms of the loans and weighted by loan size.
9. Calculated by weighting the prime rate reported by each bank by the volume
of loans reported by that bank, summing the results, and then averaging over all
reporting banks.
10. The proportion of loans made at rates below the prime may vary substantially from the proportion of such loans outstanding in banks' portfolios.
All
Special Tables • August 1994
4.30 ASSETS AND LIABILITIES of U.S. Branches and Agencies of Foreign Banks, March 31, 19941
Millions of dollars, except as noted
All states2
Item
1 Total assets4
Total
including
IBFs3
California
New York
IBFs
only3
Total
including
IBFs
IBFs
only
Illinois
Total
including
IBFs
IBFs
only
Total
including
IBFs
IBFs
only
693,578
314,037
524,498
249,160
76,291
35,571
58,313
21,646
2 Claims on nonrelated parties
3 Cash and balances due from depository institutions
4 Cash items in process of collection and unposted
debits
5 Currency and coin (U.S. and foreign)
6 Balances with depository institutions in United States ..
7
U.S. branches and agencies of other foreign banks
(including IBFs)
8
Other depository institutions in United States
(including IBFs)
9 Balances with banks in foreign countries and with
foreign central banks
10
Foreign branches of U.S. banks
Other banks in foreign countries and foreign central
11
banks
12 Balances with Federal Reserve Banks
618,234
140,873
182,826
118,174
461,470
120,506
148,245
99,630
70,517
8,003
17,189
7,371
57,255
10,879
12,306
10,270
2,736
22
92,660
0
n.a.
74,216
2,579
15
78,994
0
n.a.
61,915
21
1
5,080
0
n.a.
4,497
103
1
7,920
0
n.a.
7,512
87,392
71,135
74,450
59,112
4,6%
4,324
7,745
7,412
5,269
3,081
4,544
2,802
384
173
175
100
44,961
1,701
43,958
1,455
38,495
1,577
37,716
1,332
2,884
42
2,874
42
2,843
33
2,759
33
43,260
492
42,503
n.a.
36,918
423
36,384
n.a.
2,842
17
2,832
n.a.
2,811
11
2,726
n.a.
13 Total securities and loans
371,569
55,936
253,135
40,926
56,744
9,253
35,654
1,670
84,323
26,623
13,433
n.a.
76,172
24,677
12,213
n.a.
4,970
1,609
786
n.a.
2,620
259
421
n.a.
21,008
n.a.
20,586
n.a.
36,693
13,433
30,909
12,213
3,120
786
2,320
421
39,379
10,215
5,0%
24,068
3,144
2,349
240
556
35,378
8,585
4,747
22,047
2,863
2,110
240
513
648
477
85
86
49
39
0
10
2,926
929
78
1,918
208
180
0
28
287,360
114
287,246
42,511
8
42,503
177,036
73
176,963
28,717
5
28,712
51,793
19
51,774
8,469
2
8,467
33,043
9
33,034
1,249
0
1,248
43,264
43,297
20,312
18,361
1,951
461
28,245
10,704
10,475
229
24,117
28,911
12,379
11,116
1,264
273
18,153
6,052
5,873
179
12,789
8,980
6,146
6,069
77
173
6,789
4,062
4,052
10
3,886
1,885
1,569
1,045
524
13
841
553
538
15
61
22,924
714
22,210
21,371
0
17,542
522
17,019
820
61
16,471
499
15,972
17,802
0
12,101
327
11,775
715
0
2,834
205
2,629
1,399
0
2,727
195
2,532
15
0
316
316
1,670
0
288
0
288
49
160,010
141,307
18,703
809
339
470
10,071
57
10,014
30
0
30
90,643
77,284
13,359
532
298
234
7,055
31
7,024
23
0
23
27,950
25,680
2,271
60
17
43
1,428
13
1,416
0
0
0
23,551
22,891
660
34
1
33
308
0
308
0
0
0
4,192
2,666
3,138
2,312
159
63
187
37
9,188
4,504
53
121
8,705
2,462
53
90
271
183
0
0
128
1,701
0
0
50,311
13,828
10,008
3,820
5,462
n.a.
n.a.
n.a.
38,792
8,983
6,425
2,558
4,749
n.a.
n.a.
n.a.
4,976
3,473
2,676
797
483
n.a.
n.a.
n.a.
5,514
733
594
139
158
n.a.
n.a.
n.a.
36,483
75,345
5,462
131,211
29,809
63,028
4,749
100,915
1,503
5,774
483
18,382
4,781
1,059
158
9,340
75,345
n.a.
63,028
n.a.
5,774
n.a.
1,059
n.a.
n.a.
131,211
n.a.
100,915
n.a.
18,382
n.a.
9,340
52 Total liabilities4
693,578
314,037
524,498
249,160
76,291
35,571
58,313
21,646
53 Liabilities to nonrelated parties
580,950
294,430
470,%2
235,489
57,523
35,076
37,087
18,289
14 Total securities, book value
15 U.S. Treasury
16 Obligations of U.S. government agencies and
corporations
17 Other bonds, notes, debentures, and corporate stock
(including state and local securities)
18 Federal funds sold and securities purchased under
agreements to resell
19 U.S. branches and agencies of other foreign banks
20 Commercial banks in United States
21 Other
22 Total loans, gross
23 LESS: Unearned income on loans
24 EQUALS: Loans, net
Total loans, gross, by category
25 Real estate loans
26 Loans to depository institutions
27 Commercial banks in United States (including IBFs)
28
U.S. branches and agencies of other foreign banks . . .
29
Other commercial banks in United States
30 Other depository institutions in United States (including
IBFs)
31 Banks in foreign countries
Foreign branches of U.S. banks
32
33
Other banks in foreign countries
34 Loans to other financial institutions
35 Commercial and industrial loans
36 U.S. addressees (domicile)
37 Non-U.S. addressees (domicile)
38 Acceptances of other banks
39 U.S. banks
40 Foreign banks
41 Loans to foreign governments and official institutions
(including foreign central banks)
42 Loans for purchasing or carrying securities (secured and
unsecured)
43 All other loans
44 All other assets
45 Customers' liabilities on acceptances outstanding
46
U.S. addressees (domicile)
Non-U.S. addressees (domicile)
47
48 Other assets including other claims on nonrelated
parties
49 Net due from related depository institutions
office and other related depository
50 Net due from head
institutions5
offices, and other
51 Net due from establishing entity, head
related depository institutions5
240
n.a.
41
0
n.a.
U.S. Branches and Agencies
4.30 ASSETS AND LIABILITIES of U.S. Branches and Agencies of Foreign Banks, March 31, 1994'—Continued
Millions of dollars, except as noted
All states2
Total
excluding
IBFs3
54 Total deposits and credit balances
55 Individuals, partnerships, and corporations
56
U.S. addressees (domicile)
57
Non-U.S. addressees (domicile)
58 Commercial banks in United States (including IBFs).
59
U.S. branches and agencies of other foreign banks
60
Other commercial banks in United States
61 Banks in foreign countries
62
Foreign branches of U.S. banks
63
Other banks in foreign countries
64 Foreign governments and official institutions
(including foreign central banks)
65 All other deposits and credit balances
66 Certified and official checks
67 Transaction accounts and credit balances
(excluding IBFs)
68 Individuals, partnerships, and corporations
69
U.S. addressees (domicile)
70
Non-U.S. addressees (domicile)
71 Commercial banks in United States (including IBFs).
72
U.S. branches and agencies of other foreign banks
73
Other commercial banks in United States
74 Banks in foreign countries
75
Foreign branches of U.S. banks
76
Other banks in foreign countries
77 Foreign governments and official institutions
(including foreign central banks)
78 All other deposits and credit balances
79 Certified and official checks
80 Demand deposits (included in transaction accounts
and credit balances)
81 Individuals, partnerships, and corporations
82
U.S. addressees (domicile)
83
Non-U.S. addressees (domicile)
84 Commercial banks in United States (including IBFs).
85
U.S. branches and agencies of other foreign banks
86
Other commercial banks in United States
87 Banks in foreign countries
88
Foreign branches of U.S. banks
89
Other banks in foreign countries
90 Foreign governments and official institutions
(including foreign central banks)
91 All other deposits and credit balances
92 Certified and official checks
93 Nontransaction accounts (including MMDAs,
excluding IBFs)
Individuals, partnerships, and corporations
U.S. addressees (domicile)
Non-U.S. addressees (domicile)
Commercial banks in United States (including IBFs).
U.S. branches and agencies of other foreign banks
Other commercial banks in United States
Banks in foreign countries
Foreign branches of U.S. banks
Other banks in foreign countries
Foreign governments and official institutions
(including foreign central banks)
104 All other deposits and credit balances
94
95
96
97
98
99
100
101
102
103
105 IBF deposit liabilities
106 Individuals, partnerships, and corporations
107
U.S. addressees (domicile)
108
Non-U.S. addressees (domicile)
109 Commercial banks in United States (including IBFs).
110
U.S. branches and agencies of other foreign banks
111
Other commercial banks in United States
112 Banks in foreign countries
113
Foreign branches of U.S. banks
114
Other banks in foreign countries
115 Foreign governments and official institutions
(including foreign central banks)
116 All other deposits and credit balances
Footnotes appear at end of table.
IBFs
only3
136,572
93,253
79,995
13,257
23,165
13,199
9,967
8,540
2,951
5,589
224,953
11,690
153
11,537
69,392
63,111
3,795
7,470
349
19,146
52
6,281
124,674
4,572
120,102
New York
Illinois
California
Total
excluding
IBFs
IBFs
only
Total
excluding
IBFs
IBFs
only
Total
excluding
IBFs
119,622
79,395
71,841
7,554
21,233
12,064
9,169
8,241
2,951
5,291
203,672
7,589
152
7,436
64,941
59,341
5,600
115,272
4,157
111,115
4,483
4,161
2,593
1,568
76
63
13
33
6,033
360
5,064
3,986
3,137
849
935
418
518
3,502
6,954
297
15,818
52
183
11
19
0
33
8,893
7,104
5,260
1,844
98
15
83
878
7,257
5,757
4,621
1,136
82
10
72
716
345
279
217
61
9
877
716
24
365
99
349
323
82
297
8,350
6,686
5,124
1,561
83
11
72
823
0
360
2,155
1,873
282
2,765
268
2,497
753
0
62
0
62
3
72
7
323
310
306
4
0
0
0
0
2
0
7,027
5,616
4,561
1,055
76
7
70
668
287
236
189
47
822
668
0
1
0
0
24
0
309
297
293
4
24
2
335
73
349
305
64
297
3
5
19
7
127,679
86,149
74,735
11,413
23,068
13,184
9,883
7,663
2,950
4,712
112,366
73,639
67,220
6,418
21,151
12,054
9,097
7,525
2,950
4,575
4,138
3,882
2,376
1,506
67
63
4
9
4,741
3,675
2,830
845
935
418
518
9
60
3,430
7,371
3,179
6,872
180
0
9
24
0
1
1
3
1
60
0
0
0
120,102
19,146
52
15,818
52
6,281
124,674
4,572
0
0
0
2
0
0
203,672
7,589
152
7,436
64,941
59,341
5,600
115,272
4,157
111,115
224,953
11,690
153
11,537
69,392
63,111
2
71
6,033
360
0
360
2,155
1,873
282
2,765
268
2,497
753
0
A73
A74
Special Tables • August 1994
4.30 ASSETS AND LIABILITIES of U.S. Branches and Agencies of Foreign Banks, March 31, 1994'—Continued
Millions of dollars, except as noted
All states2
Item
117
118
119
170
121
177
123
124
125
176
127
128
Total
including
IBFs 3
Federal funds purchased and securities sold under
agreements to repurchase
U.S. branches and agencies of other foreign banks
Other commercial banks in United States
Other
Other borrowed money
Owed to nonrelated commercial banks in United States
(including IBFs)
Owed to U.S. offices of nonrelated U.S. banks
Owed to U.S. branches and agencies of
nonrelated foreign banks
Owed to nonrelated banks in foreign countries
Owed to foreign branches of nonrelated U.S. banks . . .
Owed to foreign offices of nonrelated foreign banks
Owed to others
All other liabilities
Branch or agency liability on acceptances executed
and outstanding
131
Other liabilities to nonrelated parties
129
130
5
Net due to related depository institutions
Net owed to head
office and other related depository
institutions5
134
Net owed to establishing entity, head
office, and other
related depository institutions5
132
133
New York
IBFs
only3
Total
including
IBFs
Illinois
California
IBFs
only
Total
including
IBFs
IBFs
only
Total
including
IBFs
IBFs
only
60,117
12,095
11,163
36,859
114,358
6,669
2,339
292
4,038
58,534
49,569
8,345
8,427
32,797
63,591
4,100
961
226
2,913
24,018
5,864
2,744
2,006
1,115
36,654
2,140
1,159
46
935
26,463
4,482
929
696
2,857
11,906
396
1%
20
180
7,200
39,725
9,161
21,644
1,989
16,288
5,741
4,708
413
18,593
2,134
14,358
1,226
3,511
972
2,233
322
30,564
36,520
1,759
34,760
38,113
19,655
34,292
1,710
32,582
2,598
10,547
19,107
751
18,355
28,196
4,295
17,071
717
16,354
2,238
16,459
11,948
674
11,274
6,113
13,131
11,824
669
11,155
281
2,539
4,889
313
4,576
3,505
1,911
4,T 88
313
4,575
79
44,949
4,273
34,508
3,700
4,489
440
5,049
14,535
30,414
n.a.
n.a.
4,273
9,701
24,807
3,700
3,467
1,021
112,628
19,607
53,536
13,671
18,767
112,628
n.a.
53,536
n.a.
18,767
n.a.
19,607
n.a.
13,671
n.a.
106
n.a.
440
676
4,373
495
21,226
3,357
n.a.
n.a.
495
106
21,226
n.a.
n.a.
3,357
MEMO
135
136
137
138
139
140
141
142
143
Non-interest-bearing balances with commercial banks
in United States
Holding of commercial paper included in total loans
Holding of own acceptances included in commercial
and industrial loans
Commercial and industrial loans with remaining maturity
of one year or less
Predetermined interest rates
Floating interest rates
Commercial and industrial loans with remaining maturity
of more than one year
Predetermined interest rates
Floating interest rates
1,146
940
0
878
920
0
128
1
0
42
10
3,199
2,233
720
92
98,492
55,667
42,825
54,724
30,095
24,629
16,963
10,646
6,317
15,943
11,355
4,588
61,518
19,332
42,186
n.a.
35,919
10,978
24,941
n.a.
10,987
4,152
6,835
n.a.
7,608
3,039
4,569
0
n.a.
U.S. Branches and Agencies
A75
4.30 ASSETS AND LIABILITIES of U.S. Branches and Agencies of Foreign Banks, March 31, 1994'—Continued
Millions of dollars, except as noted
All states2
Item
144 Components of total nontransaction accounts,
included in total deposits and credit balances of
nontransaction accounts, including IBFs
145 Time CDs in denominations of $100,000 or more
146 Other time deposits in denominations of $100,000
or more
147 Time CDs in denominations of $100,000 or more
with remaining maturity of more than 12 months ..
Total
excluding
IBFs3
IBFs
only3
IBFs
only
IBFs
only
Total
excluding
IBFs
IBFs
only
4,949
2,884
t
5,189
3,421
t
n.a.
1,093
n.a.
676
1
118,060
86,036
t
25,227
n.a.
22,626
n.a.
898
11,340
\
9,398
1
1,167
IBFs
only
0
70,784
551
2
0
n.a.
0
1. Data are aggregates of categories reported on the quarterly form FFIEC 002,
"Report of Assets and Liabilities of U.S. Branches and Agencies of Foreign
Banks." The form was first used for reporting data as of June 30, 1980, and was
revised as of December 31, 1985. From November 1972 through May 1980, U.S.
branches and agencies of foreign banks had filed a monthly FR 886a report.
Aggregate data from that report were available through the Federal Reserve
statistical release G.ll, last issued on July 10, 1980. Data in this table and in the
G.ll tables are not strictly comparable because of differences in reporting panels
and in definitions of balance sheet items. IBF, international banking faculty.
2. Includes the District of Columbia.
3. Effective December 1981, the Federal Reserve Board amended Regulations
D and Q to permit banking offices located in the United States to operate
international banking facilities (IBFs). Since December 31, 1985, data for IBFs
have been reported in a separate column. These data are either included in or
excluded from the total columns as indicated in the headings. The notation "n.a."
indicates that no IBF data have been reported for that item, either because the
New York
Total
including
IBFs
0
34,768
258
Illinois
Total
excluding
IBFs
t
Total
including
IBFs
Total
excluding
IBFs
California
133,181
96,614
All states
148 Market value of securities held
149 Immediately available funds with a maturity greater than
one day included in other borrowed money
150 Number of reports filed5
New York
\
California
IBFs
only
0
n.a.
0
Total
including
IBFs
0
27,339
127
Illinois
IBFs
only
0
n.a.
0
Total
including
IBFs
0
7,083
49
IBFs
only
0
n.a.
0
item is not an eligible IBF asset or liability or because that level of detail is not
reported for IBFs. From December 1981 through September 1985, IBF data were
included in all applicable items reported.
4. Total assets and total liabilities include net balances, if any, due from or
owed to related banking institutions in the United States and in foreign countries
(see note 5). On the former monthly branch and agency report, available through
the G. 11 statistical release, gross balances were included in total assets and total
liabilities. Therefore, total asset and total liability figures in this table are not
comparable to those in the G.ll tables.
5. Related depository institutions includes the foreign head office and other
U.S. and foreign branches and agencies of a bank, a bank's parent holding
company, and majority-owned banking subsidiaries of the bank and of its parent
holding company (including subsidiaries owned both directly and indirectly).
6. In some cases two or more offices of a foreign bank within the same
metropolitan area file a consolidated report.
76
Index to Statistical Tables
References are to pages A3-A75 although the prefix "A" is omitted in this index
ACCEPTANCES, bankers (See Bankers acceptances)
Agricultural loans, commercial banks, 21, 22
Assets and liabilities (See also Foreigners)
Banks, by classes, 18-22
Domestic finance companies, 36
Federal Reserve Banks, 11
Financial institutions, 28
Foreign banks, U.S. branches and agencies, 23, 72-75
Automobiles
Consumer installment credit, 39
Production, 47, 48
BANKERS acceptances, 10, 22, 26
Bankers balances, 18-22, 72-75. (See also Foreigners)
Bonds (See also U.S. government securities)
New issues, 35
Rates, 26
Branch banks, 23
Business activity, nonfinancial, 45
Business expenditures on new plant and equipment, 35
Business loans (See Commercial and industrial loans)
CAPACITY utilization, 46
Capital accounts
Federal Reserve Banks, 11
Central banks, discount rates, 65
Certificates of deposit, 26
Commercial and industrial loans
Commercial banks, 21
Weekly reporting banks, 21-23
Commercial banks
Assets and liabilities, 18-22, 68-71
Commercial and industrial loans, 18-23
Consumer loans held, by type and terms, 39
Deposit interest rates of insured, 16
Loans sold outright, 21
Nondeposit funds, 72-75
Real estate mortgages held, by holder and property, 38
Terms of lending, 68-71
Time and savings deposits, 4
Commercial paper, 24, 26, 36
Condition statements (See Assets and liabilities)
Construction, 45, 49
Consumer installment credit, 39
Consumer prices, 45, 46
Consumption expenditures, 52, 53
Corporations
Nonfinancial, assets and liabilities, 35
Profits and their distribution, 35
Security issues, 34,65
Cost of living (See Consumer prices)
Credit unions, 39
Currency in circulation, 5, 14
Customer credit, stock market, 27
DEBITS to deposit accounts, 17
Debt (See specific types of debt or securities)
Demand deposits
Banks, by classes, 18-23
Demand deposits—Continued
Ownership by individuals, partnerships, and
corporations, 23
Turnover, 17
Depository institutions
Reserve requirements, 9
Reserves and related items, 4, 5, 6, 13
Deposits (See also specific types)
Banks, by classes, 4, 18-22, 24
Federal Reserve Banks, 5,11
Interest rates, 16
Turnover, 17
Discount rates at Reserve Banks and at foreign central banks and
foreign countries (See Interest rates)
Discounts and advances by Reserve Banks (See Loans)
Dividends, corporate, 35
EMPLOYMENT, 45
Eurodollars, 26
FARM mortgage loans, 38
Federal agency obligations, 5, 10, 11, 12, 31, 32
Federal credit agencies, 33
Federal finance
Debt subject to statutory limitation, and types and ownership
of gross debt, 30
Receipts and outlays, 28, 29
Treasuryfinancingof surplus, or deficit, 28
Treasury operating balance, 28
Federal Financing Bank, 28, 33
Federal funds, 7, 19, 21, 22, 23, 26, 28
Federal Home Loan Banks, 33
Federal Home Loan Mortgage Corporation, 33, 37, 38
Federal Housing Administration, 33, 37, 38
Federal Land Banks, 38
Federal National Mortgage Association, 33, 37, 38
Federal Reserve Banks
Condition statement, 11
Discount rates (See Interest rates)
U.S. government securities held, 5, 11, 12, 30
Federal Reserve credit, 5, 6, 11, 12
Federal Reserve notes, 11
Federally sponsored credit agencies, 33
Finance companies
Assets and liabilities, 36
Business credit, 36
Loans, 39
Paper, 24, 26
Financial institutions, loans to, 21, 22, 23
Float, 51
Flow of funds, 40, 42, 43, 44
Foreign banks, assets and liabilities of U.S. branches and
agencies, 22, 23, 72-75
Foreign currency operations, 11
Foreign deposits in U.S. banks, 5, 11,21,22
Foreign exchange rates, 66
Foreign trade, 54
Foreigners
Claims on, 55, 58, 59, 60, 62
Liabilities to, 22, 54, 55, 56, 61, 63, 64
All
GOLD
Certificate account, 11
Stock, 5, 54
Government National Mortgage Association, 33, 37, 38
Gross domestic product, 51
HOUSING, new and existing units, 49
INCOME, personal and national, 45, 51, 52
Industrial production, 45, 47
Installment loans, 39
Insurance companies, 30, 38
Interest rates
Bonds, 26
Commercial banks, 68-71
Consumer installment credit, 39
Deposits, 16
Federal Reserve Banks, 8
Foreign central banks and foreign countries, 66
Money and capital markets, 26
Mortgages, 37
Prime rate, 25
International capital transactions of United States, 53-65
International organizations, 55, 56, 58, 61, 62
Inventories, 51
Investment companies, issues and assets, 35
Investments (See also specific types)
Banks, by classes, 18—23
Commercial banks, 4, 18-23
Federal Reserve Banks, 11, 12
Financial institutions, 38
LABOR force, 45
Life insurance companies (See Insurance companies)
Loans (See also specific types)
Banks, by classes, 18-23
Commercial banks, 4, 18-23
Federal Reserve Banks, 5, 6, 8, 11, 12
Financial institutions, 38
Insured or guaranteed by United States, 37, 38
MANUFACTURING
Capacity utilization, 46
Production, 46, 48
Margin requirements, 27
Member banks (See also Depository institutions)
Federal funds and repurchase agreements, 7
Reserve requirements, 9
Mining production, 48
Mobile homes shipped, 49
Monetary and credit aggregates, 4, 13
Money and capital market rates, 26
Money stock measures and components, 4, 14
Mortgages (See Real estate loans)
Mutual funds, 35
Mutual savings banks (See Thrift institutions)
NATIONAL defense outlays, 29
National income, 51
OPEN market transactions, 10
PERSONAL income, 52
Prices
Consumer and producer, 45, 50
Stock market, 27
Prime rate, 25
Producer prices, 45, 50
Production, 45, 47
Profits, corporate, 35
REAL estate loans
Banks, by classes, 21, 22, 38
Terms, yields, and activity, 37
Type of holder and property mortgaged, 38
Repurchase agreements, 7, 21-23
Reserve requirements, 9
Reserves
Commercial banks, 18
Depository institutions, 4, 5, 6, 13
Federal Reserve Banks, 11
U.S. reserve assets, 54
Residential mortgage loans, 37
Retail credit and retail sales, 39, 40, 45
SAVING
Flow of funds, 40, 42, 43, 44
National income accounts, 51
Savings and loan associations, 38, 39, 40
Savings banks, 38, 39
Savings deposits (See Time and savings deposits)
Securities (See also specific types)
Federal and federally sponsored credit agencies, 33
Foreign transactions, 63
New issues, 34
Prices, 27
Special drawing rights, 5, 11, 53, 54
State and local governments
Deposits, 21, 22
Holdings of U.S. government securities, 30
New security issues, 34
Ownership of securities issued by, 21, 22
Rates on securities, 26
Stock market, selected statistics, 27
Stocks (See also Securities)
New issues, 34
Prices, 27
Student Loan Marketing Association, 33
TAX receipts, federal, 29
Thrift institutions, 4. (See also Credit unions and Savings and
loan associations)
Time and savings deposits, 4, 14, 16, 18-23
Trade, foreign, 54
Treasury cash, Treasury currency, 5
Treasury deposits, 5, 11, 28
Treasury operating balance, 28
UNEMPLOYMENT, 45
U.S. government balances
Commercial bank holdings, 18-23
Treasury deposits at Reserve Banks, 5, 11, 28
U.S. government securities
Bank holdings, 18-23, 30
Dealer transactions, positions, andfinancing,32
Federal Reserve Bank holdings, 5, 11, 12, 30
Foreign and international holdings and
transactions, 11, 30, 64
Open market transactions, 10
Outstanding, by type and holder, 28, 30
Rates, 25
U.S. international transactions, 53-66
Utilities, production, 48
VETERANS Administration, 37, 38
WEEKLY reporting banks, 22-24
Wholesale (producer) prices, 45, 50
YIELDS (See Interest rates)
78
Federal Reserve Board of Governors
and Official Staff
A L A N GREENSPAN,
A L A N S . BLINDER,
OFFICE OF BOARD
Chairman
Vice Chairman
EDWARD W . KELLEY, JR.
JOHN P. LAWARE
MEMBERS
JOSEPH R. COYNE, Assistant to the Board
DONALD J. WINN, Assistant to the Board
THEODORE E. ALLISON, Assistant to the Board for
Federal
Reserve System Affairs
LYNN S. FOX, Deputy Congressional Liaison
WINTHROP P. HAMBLEY, Special Assistant to the Board
BOB STAHLY MOORE, Special Assistant to the Board
DIANE E. WERNEKE, Special Assistant to the Board
LEGAL
DIVISION OF INTERNATIONAL
FINANCE
EDWIN M . TRUMAN, Staff Director
LARRY J. PROMISEL, Senior Associate Director
CHARLES J. SIEGMAN, Senior Associate Director
D A L E W . HENDERSON, Associate Director
DAVID H . HOWARD, Senior Adviser
DONALD B . ADAMS, Assistant Director
PETER HOOPER III, Assistant Director
KAREN H . JOHNSON, Assistant Director
RALPH W . SMITH, JR., Assistant Director
DIVISION
J. VIRGIL MATTINGLY, JR., General Counsel
SCOTT G. ALVAREZ, Associate General Counsel
RICHARD M. ASHTON, Associate General Counsel
OLIVER IRELAND, Associate General Counsel
KATHLEEN M. O'DAY, Associate General Counsel
ROBERT DEV. FRIERSON, Assistant General Counsel
KATHERINE H. WHEATLEY, Assistant General Counsel
OFFICE OF THE
WILLIAM W. WILES,
SECRETARY
LAWRENCE SLIFMAN, Associate
Secretary
JENNIFER J. JOHNSON, Deputy
Secretary
BARBARA R. LOWREY, Associate
Secretary
DIVISION OF BANKING
SUPERVISION AND REGULATION
RICHARD SPILLENKOTHEN, Director
STEPHEN C . SCHEMERING, Deputy Director
D O N E . KLINE, Associate Director
WILLIAM A . RYBACK, Associate Director
FREDERICK M . STRUBLE, Associate Director
HERBERT A . BIERN, Deputy Associate Director
ROGER T. COLE, Deputy Associate Director
JAMES I. GARNER, Deputy Associate Director
HOWARD A . AMER, Assistant Director
GERALD A . EDWARDS, JR., Assistant Director
JAMES D . GOETZINGER, Assistant Director
STEPHEN M . HOFFMAN, JR., Assistant Director
LAURA M . HOMER, Assistant Director
JAMES V. HOUPT, Assistant Director
JACK P. JENNINGS, Assistant Director
MICHAEL G . MARTINSON, Assistant Director
RHOGER H PUGH, Assistant Director
SIDNEY M . SUSSAN, Assistant Director
MOLLY S . WASSOM, Assistant Director
WILLIAM SCHNEIDER, Project
National Information Center
DIVISION OF RESEARCH AND STATISTICS
MICHAEL J. PRELL, Director
EDWARD C . ETTIN, Deputy Director
DAVID J. STOCKTON, Deputy Director
MARTHA BETHEA, Associate Director
WILLIAM R . JONES, Associate Director
MYRON L . KWAST, Associate Director
PATRICK M . PARKINSON, Associate Director
THOMAS D . SIMPSON, Associate Director
Director,
Director
Deputy Associate Director
PETER A . TINSLEY, Deputy Associate Director
FLINT BRAYTON, Assistant Director
DAVID S . JONES, Assistant Director
STEPHEN A . RHOADES, Assistant Director
CHARLES S. STRUCKMEYER, Assistant Director
ALICE PATRICIA WHITE, Assistant Director
JOYCE K . ZICKLER, Assistant Director
JOHN J. MINGO, Senior Adviser
MARTHA S . SCANLON,
GLENN B. CANNER,
Adviser
LEVON H . GARABEDIAN,
Assistant Director
(Administration )
DIVISION OF MONETARY AFFAIRS
DONALD L . KOHN, Director
DAVID E . LINDSEY, Deputy Director
BRIAN F. MADIGAN, Associate Director
RICHARD D . PORTER, Deputy Associate Director
VINCENT R . REINHART, Assistant Director
NORMAND R.V. BERNARD, Special Assistant to the Board
DIVISION OF CONSUMER
AND COMMUNITY AFFAIRS
GRIFFITH L. GARWOOD,
Director
Associate Director
DOLORES S . SMITH, Associate Director
MAUREEN P. ENGLISH, Assistant Director
IRENE SHAWN M C N U L T Y , Assistant Director
GLENN E . LONEY,
79
LAWRENCE B . LINDSEY
S U S A N M . PHILLIPS
OFFICE OF
STAFF DIRECTOR FOR
MANAGEMENT
Staff Director
Equal Employment Opportunity
Programs Officer
S . DAVID FROST,
PORTIA W . THOMPSON,
DIVISION OF HUMAN RESOURCES
MANAGEMENT
DAVID L . SHANNON, Director
JOHN R . WEIS, Associate Director
ANTHONY V. DIGIOIA, Assistant Director
JOSEPH H . HAYES, JR., Assistant Director
FRED HOROWITZ, Assistant Director
OFFICE OF THE CONTROLLER
GEORGE E . LIVINGSTON, Controller
STEPHEN J. CLARK, Assistant Controller {Programs and
Budgets)
DARRELL R . PAULEY, Assistant Controller (Finance)
DIVISION OF SUPPORT SERVICES
ROBERT E . FRAZIER, Director
GEORGE M . LOPEZ, Assistant Director
DAVID L . WILLIAMS, Assistant Director
DIVISION OF INFORMATION RESOURCES
MANAGEMENT
STEPHEN R . MALPHRUS, Director
MARIANNE M. EMERSON, Assistant
Po
Director
Assistant Director
RAYMOND H . MASSEY, Assistant Director
EDWARD T. MULRENIN, Assistant Director
DAY W . RADEBAUGH, JR., Assistant Director
ELIZABETH B . RIGGS, Assistant Director
RICHARD C . STEVENS, Assistant Director
K Y U N G KIM,
DIVISION OF RESERVE BANK OPERATIONS
AND PAYMENT SYSTEMS
CLYDE H . FARNSWORTH, JR., Director
DAVID L . ROBINSON, Deputy Director (Finance and
Control)
CHARLES W . BENNETT, Assistant Director
JACK DENNIS, JR., Assistant Director
EARL G . HAMILTON, Assistant Director
JEFFREY C . MARQUARDT, Assistant Director
JOHN H. PARRISH, Assistant
Director
Assistant Director
YOUNG, Assistant Director
LOUISE L . ROSEMAN,
FLORENCE M .
OFFICE OF THE INSPECTOR GENERAL
BRENT L. BOWEN, Inspector
General
DONALD L. ROBINSON, Assistant Inspector General
BARRY R. SNYDER, Assistant Inspector General
80
Federal Reserve Bulletin • August 1994
Federal Open Market Committee
and Advisory Councils
FEDERAL OPEN MARKET
COMMITTEE
MEMBERS
A L A N GREENSPAN,
Chairman
WILLIAM J. MCDONOUGH,
Vice Chairman
ALAN S. BLINDER
JERRY L. JORDAN
LAWRENCE B . LINDSEY
J. ALFRED BROADDUS, JR.
EDWARD W . KELLEY, JR.
ROBERT T. PARRY
ROBERT P. FORRESTAL
JOHN P. LAWARE
SUSAN M . PHILLIPS
ALTERNATE
THOMAS M . HOENIG
MEMBERS
THOMAS C . MELZER
JAMES H . OLTMAN
WILLIAM C . CONRAD
STAFF
DONALD L. KOHN, Secretary
NORMAND R.V. BERNARD,
and
JACK H. BEEBE, Associate
Economist
MARVIN S. GOODFRIEND, Associate
Economist
DAVID E. LINDSEY, Associate
Economist
LARRY J. PROMISEL, Associate
Economist
CHARLES J. SIEGMAN, Associate
Economist
THOMAS D. SIMPSON, Associate
Economist
Economist
Deputy Secretary
JOSEPH R. COYNE, Assistant
Secretary
GARY P. GILLUM, Assistant
Secretary
J. VIRGIL MATTINGLY, JR., General Counsel
Deputy General Counsel
Economist
ERNEST T. PATRIKIS,
M I C H A E L J. P R E L L ,
EDWIN M. TRUMAN,
DAVID J. STOCKTON,
JOAN E . LOVETT,
Associate Economist
SHEILA L. TSCHINKEL, Associate
Economist
Economist
Manager for Domestic Operations, System Open Market Account
Manager for Foreign Operations, System Open Market Account
PETER R . FISHER,
FEDERAL ADVISORY
COUNCIL
RICHARD M. ROSENBERG,
EUGENE A . MILLER,
N.
Seventh District
B. CRAIG, III, Eighth District
JOHN F. GRUNDHOFER, Ninth District
DAVID A . RISMILLER, Tenth District ]
CHARLES R . HRDLICKA, Eleventh District
RICHARD M . ROSENBERG, Twelfth District
First District
Second District
ANTHONY P. TERRACCIANO, Third District
FRANK V. CAHOUET, Fourth District
RICHARD G . TILGHMAN, Fifth District
CHARLES E. RICE, Sixth District
MARSHALL
EUGENE A . MILLER,
CARTER,
ANDREW
J. CARTER BACOT,
President
Vice President
HERBERT V. PROCHNOW,
Secretary Emeritus
Co-Secretary
Co-Secretary
WILLIAM J. KORSVIK,
JAMES ANNABLE,
81
CONSUMER ADVISORY
COUNCIL
Chicago, Illinois, Chairman
L. WEST, Tijeras, New Mexico, Vice Chairman
JEAN POGGE,
JAMES
BARRY A. ABBOTT, San Francisco, California
JOHN R. ADAMS, Philadelphia, Pennsylvania
JOHN
A.
BAKER,
Atlanta, Georgia
KATHARINE
MULUGETTA BIRRU, Pittsburgh, Pennsylvania
St. Paul, Minnesota
Bronx, New York
DOUGLAS D . BLANKE,
GENEVIEVE BROOKS,
CATHY CLOUD, W a s h i n g t o n , D . C .
Boston, Massachusetts
Dallas, Texas
W. MCKEE, Durham, North Carolina
RONALD HOMER,
THOMAS L . HOUSTON,
EDMUND MIERZWINSKI, W a s h i n g t o n , D . C .
ANNE B. SHLAY, Philadelphia, Pennsylvania
JOHN V. SKINNER, Irving, Texas
J. SMITH, Kansas City, Missouri
N. SWANSON, Portland, Oregon
REGINALD
Orlando, Florida
D . EDWARDS, Yelm, Washington
FERRY, St. Louis, Missouri
ALVIN J. COWANS,
LOWELL
MICHAEL
JOHN E . TAYLOR, W a s h i n g t o n , D . C .
MICHAEL
ELIZABETH G. FLORES, Laredo, Texas
MICHAEL
W.
TIERNEY,
LORRAINE VANETTEN,
L. FREIBERG, New Orleans, Louisiana
Los Angeles, California
S. HATTEM, New York, New York
Washington, D.C.
Troy, Michigan
NORMA
GRACE W. WEINSTEIN, Englewood, N e w Jersey
LORI GAY,
LILY K. YAO, Honolulu, Hawaii
ROBERT O. ZDENEK, Greenwich, Connecticut
GARY
THRIFT INSTITUTIONS ADVISORY
COUNCIL
BEATRICE D'AGOSTINO, Somerville, N e w Jersey, President
CHARLES JOHN KOCH,
MALCOLM E. COLLIER, Lakewood, Colorado
WILLIAM A. COOPER, Minneapolis, Minnesota
PAUL L. ECKERT, Davenport, Iowa
GEORGE R . GLIGOREA, Sheridan, Wyoming
KERRY KILLINGER, Seattle, Washington
Cleveland, Ohio, Vice President
ROBERT MCCARTER, New Bedford, Massachusetts
NICHOLAS W. MITCHELL, JR., Winston-Salem, North
STEPHEN W. PROUGH, Newport Beach, California
STEPHEN D. TAYLOR, Miami, Florida
JOHN
M. TIPPETS, DFW Airport, Texas
Carolina
82
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1980-90, by Margaret Hastings Pickering. May 1991.
21pp.
1 6 2 . EVIDENCE ON THE SIZE OF BANKING MARKETS FROM
MORTGAGE LOAN RATES IN TWENTY CITIES, b y S t e p h e n
A. Rhoades. February 1992. 11 pp.
1 6 3 . CLEARANCE AND SETTLEMENT IN U . S . SECURITIES MAR-
KETS, by Patrick Parkinson, Adam Gilbert, Emily Gollob,
Lauren Hargraves, Richard Mead, Jeff Stehm, and Mary
Ann Taylor. March 1992. 37 pp.
1 6 4 . THE 1 9 8 9 - 9 2 CREDIT CRUNCH FOR REAL ESTATE, b y
James T. Fergus and John L. Goodman, Jr. July 1993.
20 pp.
1 6 5 . THE DEMAND FOR TRADE CREDIT: A N INVESTIGATION OF
MOTIVES FOR TRADE CREDIT USE BY SMALL BUSINESSES,
by Gregory E. Elliehausen and John D. Wolken. September 1993. 18 pp.
1 6 6 . THE ECONOMICS OF THE PRIVATE PLACEMENT MARKET,
by Mark Carey, Stephen Prowse, John Rea, and Gregory
Udell. January 1994. I l l pp.
84
Maps of the Federal Reserve System
1WMKK^^^
MINNEAPOLIS •
III
12
•
•wssyB
•
4
CHICAGO •
CLEVELAND
SAN FRANCISCO
^
IF.INSAI
WE AG 1,11
PRRVFL
YB
nJ
S ? Louis
SSSnir' f8MK§P
6m
aillMlMl
1
2 "
3_
o
5
BOSTON
ft
-
• NEW YORK
•
PHILADELPHIA
RICHMOND
ATLANTA
DAR*
ALASKA
HAWAII
LEGEND
Both pages
• Federal Reserve Bank city
• Board of Governors of the Federal
Reserve System, Washington, D.C.
Facing page
• Federal Reserve Branch city
— Branch boundary
NOTE
The Federal Reserve officially identifies Districts
by number and Reserve Bank city (shown on both
pages) and by letter (shown on the facing page).
In the 12th District, the Seattle Branch serves
Alaska, and the San Francisco Bank serves Hawaii.
The System serves commonwealths and terri
tories as follows: the New York Bank serves the
Commonwealth of Puerto Rico and the U.S. Virgin
Islands; the San Francisco Bank serves American
Samoa, Guam, and the Commonwealth of the
Northern Mariana Islands. The Board of Governors
revised the branch boundaries of the System most
recently in December 1991.
85
1-A
2-B
5_E
4-D
3-C
Baltimore
Pittsburgh
NY
OH
/
NH
Buffalo
• "
CT
NJ
® Cincinnati
KY
\
NY
NEW YORK
BOSTON
PHILADELPHIA
6-F
7-G
• Nashville
TN
AL \ _
Birmingham,
LA
—
m
8-H
Wl
OA
MS
RICHMOND
CLEVELAND
MO
•
MI
IA
v
(y^f
KYLouisville
Detroit •
y-m
11 •
£
^^rn^^^m. m/BM
Jacksonville
• Memphis
Uttl? > MS
Hock/
New Orleans
J Y
Miami
•
ATLANTA
J IN
CHICAGO
ST. LOUIS
9-1
• Helena
lAMMR
MI
MINNEAPOLIS
10-J
12-L
WY
CO
L
Omaha*
MO
NM
ALASKA
•
De*ver
,
Seattle
•
|—
/
/ID
L^—V/
Portland
Oklahoma• City
or
OK
c
CA
KANSAS CITY
NV7
11-K
1
•
EL Paso
•
™
S
R
B
A
1
LA
*
• <
Houston
AZ
* Los Angeles
San Antonio C
DALLAS
Salt Lake City
HAWAII
SAN FRANCISCO
'
86
Federal Reserve Banks, Branches,
and Offices
FEDERAL RESERVE BANK
Chairman
branch, or facility
Zip
Deputy Chairman
President
First Vice President
BOSTON*
02106
Cathy E. Minehan
Temporarily Vacant
NEW YORK*
10045
Jerome H. Grossman
Warren B. Rudman
Maurice R. Greenberg
David A. Hamburg
14240 Joseph J. Castiglia
William J. McDonough
James H. Oltman
PHILADELPHIA
19105
Edward G. Boehne
William H. Stone, Jr.
CLEVELAND*
44101
Buffalo
Cincinnati
Pittsburgh
RICHMOND*
James M. Mead
Donald J. Kennedy
A. William Reynolds
G. Watts Humphrey, Jr.
45201 John N. Taylor, Jr.
15230 Robert P. Bozzone
Jerry L. Jordan
Sandra Pianalto
23219
J. Alfred Broaddus, Jr.
Jimmie R. Monhollon
Henry J. Faison
Claudine B. Malone
Baltimore
21203 Rebecca Hahn Windsor
Charlotte
28230 Harold D. Kingsmore
Culpeper Communications
and Records Center 22701
ATLANTA
Birmingham
Jacksonville
Miami
Nashville
New Orleans
CHICAGO*
Detroit
ST. LOUIS
30303
35283
32231
33152
37203
70161
Silas Keehn
William C. Conrad
63166
Robert H. Quenon
John F. McDonnell
Robert D. Nabholz, Jr.
Laura M. Douglas
Sidney Wilson, Jr.
Thomas C. Melzer
James R. Bowen
Gerald A. Rauenhorst
Jean D. Kinsey
Lane Basso
Gary H. Stern
Colleen K. Strand
Burton A. Dole, Jr.
Herman Cain
Barbara B. Grogan
Ernest L. Holloway
Sheila Griffin
Thomas M. Hoenig
Richard K. Rasdall
Cece Smith
Roger R. Hemminghaus
Alvin T. Johnson
Judy Ley Allen
Erich Wendl
Robert D. McTeer, Jr.
Tony J. Salvaggio
72203
40232
38101
MINNEAPOLIS
55480
KANSAS CITY
Denver
Oklahoma City
Omaha
DALLAS
El Paso
Houston
San Antonio
SAN FRANCISCO
Los Angeles
Portland
Salt Lake City
Seattle
Robert P. Forrestal
Jack Guynn
60690 Richard G. Cline
Robert M. Healey
48231 J. Michael Moore
Little Rock
Louisville
Memphis
Helena
Leo Benatar
Hugh M. Brown
Shelton E. Allred
Samuel H. Vickers
Dorothy C. Weaver
Paula Lovell
Jo Ann Slaydon
59601
64198
80217
73125
68102
75201
79999
77252
78295
94120 James A. Vohs
Judith M. Runstad
90051 Anita E. Landecker
97208 William A. Hilliard
84125 Gerald R. Sherratt
98124 George F. Russell, Jr.
Vice President
in charge of branch
Carl W. Turnipseed1
Charles A. Cerino1
Harold J. Swart1
Ronald B. Duncan1
Walter A. Varvel1
John G. Stoides1
Donald E. Nelson1
FredR. Herr1
James D. Hawkins1
James T. Curry III
Melvyn K. Purcell
Robert J. Musso
Roby L. Sloan1
Karl W. Ashman
Howard Wells
John P. Baumgartner
John D. Johnson
Kent M. Scott1
David J. France
Harold L. Shewmaker
Sammie C.Clay
Robert Smith, III1
Thomas H. Robertson
Robert T. Parry
Patrick K. Barron
John F.Moore1
E. Ronald Liggett1
Andrea P. Wolcott
Gordon Werkema1
•Additional offices of these Banks are located at Lewiston, Maine 04240; Windsor Locks, Connecticut 06096; East Rutherford, New Jersey 07016; Jericho,
New York 11753; Utica at Oriskany, New York 13424; Columbus, Ohio 43216; Columbia, South Carolina 29210; Charleston, West Virginia 25311;
Des Moines, Iowa 50306; Indianapolis, Indiana 46204; and Milwaukee, Wisconsin 53202.
1. Senior Vice President.
Publications of Interest
FEDERAL RESERVE CONSUMER CREDIT PUBLICATIONS
The Federal Reserve Board publishes a series of
pamphlets covering individual credit laws and topics,
as pictured below. The series includes such subjects
as how the Equal Credit Opportunity Act protects
women against discrimination in their credit dealings,
how to use a credit card, and how to resolve a billing
error.
Three booklets on the mortgage process are also
available: A Consumer's Guide to Mortgage Lock-Ins,
A Consumer's Guide to Mortgage Refinancings, and
A Consumer's Guide to Mortgage Settlement Costs.
These booklets were prepared in conjunction with the
Federal Home Loan Bank Board and in consultation
with other federal agencies and trade and consumer
groups.
The Board also publishes the Consumer Handbook
to Credit Protection Laws, a complete guide to con- Copies of consumer publications are available free
sumer credit protections. This forty-four-page booklet
of charge from Publications Services, mail stop 127,
explains how to shop and obtain credit, how to mainBoard of Governors of the Federal Reserve System,
tain a good credit rating, and how to dispute unfair
Washington, DC 20551. Multiple copies for classcredit transactions.
room use are also available free of charge.
A Consumer's
Guide to
Mortgage
Lock-Ins
Business
Credit
Publications of Interest
FEDERAL RESERVE REGULATORY SERVICE
To promote public understanding of its regulatory
functions, the Board publishes the Federal Reserve
Regulatory Service, a four-volume loose-leaf service
containing all Board regulations as well as related
statutes, interpretations, policy statements, rulings,
and staff opinions. For those with a more specialized
interest in the Board's regulations, parts of this service are published separately as handbooks pertaining
to monetary policy, securities credit, consumer affairs,
and the payment system.
These publications are designed to help those who
must frequently refer to the Board's regulatory materials. They are updated monthly, and each contains
citation indexes and a subject index.
of marginable OTC stocks and its list of foreign
margin stocks.
The Consumer and Community Affairs Handbook
contains Regulations B, C, E, M, Z, AA, BB, and DD,
and associated materials.
The Payment System Handbook deals with expedited funds availability, check collection, wire transfers, and risk-reduction policy. It includes Regulations CC, J, and EE, related statutes and commentaries, and policy statements on risk reduction in the
payment system.
For domestic subscribers, the annual rate is $200
for the Federal Reserve Regulatory Service and $75
for each Handbook. For subscribers outside the
The Monetary Policy and Reserve Requirements United States, the price including additional air mail
costs is $250 for the Service and $90 for each HandHandbook contains Regulations A, D, and Q, plus
book. All subscription requests must be accompanied
related materials.
The Securities Credit Transactions Handbook con-by a check or money order payable to the Board of
Governors of the Federal Reserve System. Orders
tains Regulations G, T, U, and X, dealing with extenshould be addressed to Publications Services, mail
sions of credit for the purchase of securities, together
stop 127, Board of Governors of the Federal Reserve
with related statutes, Board interpretations, rulings,
System, Washington, DC 20551.
and staff opinions. Also included are the Board's list
GUIDE TO THE FLOW OF FUNDS ACCOUNTS
A recent Federal Reserve publication, Guide to the
Flow of Funds Accounts, explains in detail how the
U.S. financial flow accounts are prepared. The
accounts, which are compiled by the Division of
Research and Statistics, are published in the Board's
quarterly Z.l statistical release, "Flow of Funds
Accounts, Flows and Outstandings." The Guide
updates and replaces Introduction to Flow of Funds,
published in 1980.
The 670-page Guide begins with an explanation of
the organization and uses of the flow of funds
accounts and their relationship to the national income
and product accounts prepared by the U.S. Department of Commerce. Also discussed are the individual
data series that make up the accounts and such proce-
dures as seasonal adjustment, extrapolation, and
interpolation.
The balance of the Guide contains explanatory
tables corresponding to the tables of financial flows
data that appeared in the September 1992 Z.l release.
These tables give, for each data series, the source of
the data or the methods of calculation, along with
annual data for 1991 that were published in the
September 1992 release.
Guide to the Flow of Funds Accounts is available
for $8.50 per copy from Publications Services, Board
of Governors of the Federal Reserve System, Washington, DC 20551. Orders must include a check or
money order, in U.S. dollars, made payable to the
Board of Governors of the Federal Reserve System.
Federal Reserve Statistical Releases
Available on the Commerce Department's
Economic Bulletin Board
The Board of Governors of the Federal Reserve
System makes some of its statistical releases available to the public through the U.S. Department of
Commerce's economic bulletin board. Computer
access to the releases can be obtained by sub-
scription. For further information regarding a
subscription to the economic bulletin board,
please call (202) 482-1986. The releases transmitted
to the economic bulletin board, on a regular basis,
are the following:
Reference
Number
Statistical release
Frequency of release
H.3
Aggregate Reserves
Weekly/Thursday
H.4.1
Factors Affecting Reserve Balances
Weekly/Thursday.
H.6
Money Stock
Weekly/Thursday
H.8
Assets and Liabilities of Insured Domestically Chartered
and Foreign Related Banking Institutions
Weekly/Monday
H.10
Foreign Exchange Rates
Weekly/Monday
H.15
Selected Interest Rates
Weekly/Monday
G.5
Foreign Exchange Rates
Monthly/end of month
G.17
Industrial Production and Capacity Utilization
Monthly/midmonth
G.19
Consumer Installment Credit
Monthly/fifth business day
Z.7
Flow of Funds
Quarterly
@FedFRASER