Full text of Federal Reserve Bulletin : February 1980
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FEBRUARY 1980
FEDERAL RESERVE
BULLETIN
The Community Reinvestment Act: A Progress Report
The Redefined Monetary Aggregates
Domestic Financial Developments in the Fourth Quarter of 1979
Production of Motor Vehicles in 1979
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The BULLETIN may be obtained from Publications Services, Board of Governors of the Federal Reserve System,
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Federal Reserve System in a form collectible at par in U.S. currency. (Stamps and coupons are not accepted.)
VOLUME 6 6 •
NUMBER 2
•
FEBRUARY
1980
FEDERAL RESERVE
BULLETIN
Board of Governors of the Federal Reserve System
Washington, D.C.
PUBLICATIONS
COMMITTEE
Joseph R. Coyne, Chairman • Stephen H. Axilrod • John M. Denkler
Janet O. Hart • James L. Kichline • Neal L. Petersen • Edwin M. Truman
Michael J. Prell, Staff Director
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. Direction for the art work is provided by Mack R. Rowe. Editorial support is
furnished by the Economic Editing Unit headed by Mendelle T. Berenson.
Table of Contents
ACT:
Housing, and Urban Affairs, January 24,
1980.
The Board's progress in determining the extent to which banks have attempted to ascertain and meet the credit needs of their
communities is discussed.
132 Governor Philip E. Coldwell discusses the
Federal Reserve System's budget performance for 1979 and the outlook for 1980, before the Senate Committee on Banking,
Housing, and Urban Affairs, January 25,
1980.
87 THE COMMUNITY REINVESTMENT
A PROGRESS
REPORT
97 THE REDEFINED
MONETARY
AGGREGATES
New definitions of money for use in the conduct of monetary policy are described.
115 DOMESTIC FINANCIAL
DEVELOPMENTS
IN THE FOURTH QUARTER OF 1979
According to the quarterly report to the
Congress, economic expansion slowed
somewhat, and growth in the monetary aggregates weakened over the period.
123 PRODUCTION
1979
OF MOTOR
VEHICLES
IN
The sharp decline in the auto industry in
1979 was a major factor in the deceleration
of growth in total industrial production.
129 INDUSTRIAL
PRODUCTION
Output increased 0.3 percent in January.
130 STATEMENTS
TO
CONGRESS
Governor J. Charles Partee says that both
commercial banks and thrift insitutions
have lost deposits to money market mutual
funds but that the introduction of the 272year "small saver" certificate should enhance the competitive position of depositary institutions, and offers the view that
extending reserve requirements to money
market mutual funds is not necessary, before the Senate Committee on Banking,
137 Chairman Paul A. Volcker presents his
views on the state of the economy and the
advisable course for economic policy, testifying that despite the moderation in output
in 1979, inflation worsened so that not only
the stability of the U.S. economy but also
our position in the world economy was
threatened; with regard to monetary policy,
he points up the need to avoid excessive
stimulus and to keep the goal of balancing
the budget in the forefront of spending and
revenue decisions, before the Joint Economic Committee of the Congress, February 1, 1980.
143 Chairman Volcker testifies that the stream
of member banks withdrawing from the
Federal Reserve System will reach flood
proportions and that it has become progressively more costly and more difficult for
banks to justify continuing their membership; in this context, Chairman Volcker advocates legislation containing certain principles, including the application of a reserve
requirement to all transaction accounts,
equality of reserve requirements for all depositary institutions offering comparable accounts, access to Federal Reserve services
for all depositary institutions with transaction accounts, and voluntary membership in
the Federal Reserve, before the Senate
Committee on Banking, Housing, and Urban Affairs, February 4, 1980.
149
ANNOUNCEMENTS
Adoption of new definitions of money to be
used in the conduct of monetary policy.
Adoption of further final rules for Regulation E on electronic fund transfers. (See Legal Developments.)
Change in Board's rules in order to speed up
collection of large dollar-value checks.
Meeting of the Consumer Advisory Council.
Change in Board staff.
Addition of slide show to the Board's public
tour program.
Admission of five state banks to membership in the Federal Reserve System.
153 LEGAL
AI FINANCIAL AND BUSINESS
STATISTICS
A3 Domestic Financial Statistics
A46 Domestic Nonfinancial Statistics
A54 International Statistics
A69 GUIDE TO TABULAR PRESENTATION
AND STATISTICAL RELEASES
A70 BOARD OF GOVERNORS AND STAFF
All
FEDERAL OPEN MARKET COMMITTEE
AND STAFF; ADVISORY COUNCILS
A73 FEDERAL RESERVE BANKS,
AND OFFICES
A74 FEDERAL RESERVE
PUBLICATIONS
BRANCHES,
BOARD
DEVELOPMENTS
Amendments to Regulation E; bank holding company and bank merger orders; and
pending cases.
A76 INDEX TO STATISTICAL
TABLES
A78 MAP OF FEDERAL RESERVE S YSTEM
The Community Reinvestment Act:
A Progress Report
Glenn Canner and Joe M. Cleaver of the Board's
Division of Research and Statistics prepared this
article.
The Community Reinvestment Act of 1977 is intended to encourage federally insured commercial banks, mutual savings banks, and savings and loan associations to help meet the credit
needs of the local communities in which they are
chartered. The CRA directs the four federal supervisory agencies—the Board of Governors of
the Federal Reserve System, the Comptroller of
the Currency, the Federal Deposit Insurance
Corporation, and the Federal Home Loan Bank
Board—to consider an institution's CRA record
in evaluating any application for a charter, deposit insurance, branch or other deposit facility,
office relocation, merger, or acquisition. The act
also requires that, in connection with the examination of a financial institution, the appropriate
supervisory agency shall "assess the institution's record and encourage it to meet the credit
needs of its entire community, including low- and
moderate-income neighborhoods,
consistent
with safe and sound operation of such institution."
In accordance with the CRA, the Federal Reserve Board issued Regulation BB. That regulation, effective November 8, 1978, lists the criteria that the Board considers in evaluating the
CRA record of a covered institution. Neither the
CRA nor the implementing regulation was designed to inject hard and fast rules into the examination or application process. Rather, the CRA
examination is intended to be a judgmental evaluation of the performance of a lender in meeting
the credit needs of its entire community. The regulatory agencies are expected to take into account differences in absolute size of the institution, legal impediments, local economic
conditions, and community needs. Given these
circumstances, the appropriate agencies must
determine the extent to which the institution has
attempted to ascertain and meet the credit needs
of the communities it serves.
LEGISLATIVE
INTENT
The legislative history of the CRA provides a
background for understanding the direction and
scope of Regulation BB. The congressional debate over the CRA indicates that the Congress
was concerned primarily with inner-city neighborhoods in general, and with blighted and economically depressed areas in particular. The proponents of the CRA believed that the failure of
financial institutions to take advantage of sound
lending opportunities in these neighborhoods accelerated the process of economic decay and inhibited private revitalization efforts. Congressional supporters of the legislation expressed
concern about the adequacy of a variety of neighborhood-oriented loan programs, such as those
for small businesses, community development,
and housing. Support of the residential mortgage
market and provision for home improvement and
rehabilitation credit by institutional lenders were
viewed as necessary to neighborhood revitalization and stability.
While congressional supporters of the CRA
appeared to focus primarily on housing-related
loans, they expressed a general concern for the
importance of community-oriented lending. Loans
to industrial and commercial establishments,
the purchase of municipal debt, and participation in student loan programs are examples of
other types of credit extensions that may be important to a lender's CRA evaluation.
The Congress was rather clear about the types
of credit extensions it considered relevant to a
CRA evaluation but was not explicit about the
way to measure credit "needs." The legislative
debate over the CRA indicates that the Congress
88
Federal Reserve Bulletin • February 1980
did not support nonmarket methods of credit allocation, such as quotas, to meet the credit needs
of the local community. It might be inferred from
this position that the Congress intended credit
needs to be measured by the effective demand at
the going market price, with due consideration of
risk. However, the Congress failed to provide
the regulatory agencies with any guidance in assessing a community's credit needs or in determining how well a particular institution is meeting those needs. Therefore, the agencies have
begun to evolve their own standards on a caseby-case basis and have examined a variety of evidence in the evaluation of a lender's CRA performance. In addition to the procedural requirements of Regulation BB, the specific assessment
factors the Board considers in a CRA evaluation
are listed in section 228.7 of that regulation.
EVALUATING
THE
RECORD
Regulation BB outlines procedural requirements
from the act that all institutions regulated by the
Federal Reserve must meet; it also specifies factors that will be considered in connection with an
institution's CRA record. The procedures call for
public disclosure of the credit services available
at the institution, ask the institution to define the
local community that it expects to serve, and direct the institution to maintain a file of public
comments relating to CRA matters. Compliance
with procedural requirements is not sufficient to
establish that a lender has been satisfactorily
serving local credit needs. Equally important,
noncompliance does not imply failure by the
lender to meet those needs.
Several factors are particularly important in
the assessment of CRA records. The first is the
reasonableness of the community delineations.
Regulation BB gives banking organizations flexibility in defining their local communities. Depending on the circumstances, an institution may
use a recognized geographic entity such as a
standard metropolitan statistical area (SMSA) or
a county to define its local community; it may
also rely on its local banking market or any other
reasonable concept. The Board recognizes that a
small bank may not reasonably be expected to
extend its marketing and credit activities beyond
the practical geographic limitations of its basic
product lines, which may be smaller than the
geographic scope of the market in which it operates. For example, a portion of a SMSA or county may reasonably define the area a small bank is
expected to serve. Staff analysis of a banking organization's community delineation tends to focus on office locations and the geographic distribution of the organization's credit extensions.
The staff considers the geographic location of a
bank's housing-related loans, if any, but other
types of credit extensions are relevant to the review of the community delineation.
The overriding concern in the regulation is that
whatever reasonable criterion the institution
chooses, it may not arbitrarily exclude low- and
moderate-income neighborhoods. Because the
CRA does not explicitly define such areas, the
four supervisory agencies have adopted the definition that the Department of Housing and Urban
Development used in its community development block grant program. In this program, lowand moderate-income areas are defined as those
census tracts with median family income of less
than 80 percent of the median family income for
the entire SMSA. Gerrymandering the community delineation to exclude low- and moderateincome neighborhoods could constitute a prima
facie case of noncompliance with the CRA.
A second prominent factor to be considered in
assessing an institution's CRA record is the distribution of the lender's credit extensions. Under
Regulation BB, consumer compliance examiners
are directed to consider the amount of CRA-type
credit an institution extends to its local community and the geographic pattern of that lending
within the community. No restrictions are placed
on an institution's level of lending outside the local area. If a substantial portion of the lender's
CRA-type credit is extended outside the local
community, however, the institution will likely
draw closer scrutiny. CRA examiners also focus
on gaps (geographic, racial, or ethnic) in the
lender's credit extensions within the local community. A distribution of loans skewed toward
specific areas or groups does not give an institution a poor CRA record if that distribution results
f r o m a p p a r e n t v a r i a t i o n s in d e m a n d a c r o s s
neighborhoods and groups. But it will alert the
regulators to the need for closer scrutiny of the
loan pattern.
Local credit demand is the third factor that
Community
must be considered in an institution's CRA evaluation, and is the most difficult to assess. As
noted, an uneven loan pattern based on geographic, racial, or ethnic criteria may not indicate a poor CRA record if differences in effective d e m a n d explain it. Although precise
measurement of neighborhood credit demand is
extremely difficult, a variety of proxies may be
used to make inferences about demand—for example, proxies for residential loan demand might
include the number of residential loan applications in a neighborhood, the composition of
the housing stock in a neighborhood, and data on
residential property transfers, that is, deed transfers recorded. Because the level of demand is so
difficult to assess, Regulation BB directs examiners to consider those activities on the part of the
institution that are designed to promote lending
in the local community. If a bank has a good record of advertising and promoting its credit services in all areas of its community, there will be
less concern that the needs of creditworthy borrowers are unrecognized. This is particularly
true if special efforts are made by the bank to
communicate with individuals and small businesses that are located in low- and moderate-income neighborhoods.
In addition to communication and promotion
of its CRA-type activities, lending institutions
are encouraged to ascertain the credit needs of
their local communities. Market research studies, regular meetings with community groups,
and communication with realtors provide additional evidence of efforts to meet various types of
local credit needs. Finally, participation in special credit programs and investment in local municipal or state securities, particularly those related to housing needs, indicate a willingness to
help meet the credit requirements of the local
communities.
TAKING
THE RECORD
INTO
ACCOUNT
Section 802 of the Community Reinvestment Act
reasserts the intention of Congress, embodied in
previous law, that "regulated financial institutions demonstrate that their deposit facilities
serve the convenience and needs of the communities in which they are chartered to do business
. . . including the need for credit services as well
Reinvestment
Act
89
as deposit services. . . . " The institution's CRA
record is incorporated as part of the convenience-and-needs factors in assessing the likely
impact of an application. When considering a
proposed bank acquisition or merger, the Board
must weigh both the likely competitive effects of
the application and the convenience-and-needs
factors (section 3A of the Bank Holding Company Act, 12 USC § 1842(a), and the Bank Merger
Act, 12 USC 1828). If a transaction is likely
to have a seriously anticompetitive impact, the
Board may approve the application only if the
convenience-and-needs factors dominate in the
weighing of the public interest effects of the
transaction.
As a factor in convenience and needs, the
CRA record may influence the Board's decisions
in various ways. When an application involves
no significant competitive, managerial, or financial issues, the determining factor in a decision is
the balance among the applicant's CRA record,
commitments for future actions, and other convenience-and-needs aspects of the application.
The Board may approve the transaction even
when the CRA record is unsatisfactory, if commitments or other convenience-and-needs considerations outweigh the negative aspects of the
application. (See the information statement on
t h e C R A in t h e FEDERAL RESERVE
BULLETIN,
volume 66, January 1980, pages 30-32.) If an
application has anticompetitive effects, a favorable convenience-and-needs assessment is required for approval of the application. In such a
case, a positive or at least neutral CRA record
would generally be necessary to obtain Board
approval. Finally, the Board may consider an institution's CRA record so deficient that it outweighs any favorable aspects of the record and
deny the application solely on that basis.
ANALYSIS OF CRA PROTESTS BY
THE FEDERAL RESERVE SYSTEM
STAFF
When the Board receives a CRA protest, a copy
is automatically forwarded to the applicant. The
Legal Division of the Board, in consultation with
the Division of Research and Statistics and the
appropriate district Reserve Bank, then determines whether the allegations raised in the protest are substantive. If they are, the appropriate
90
Federal Reserve Bulletin • February 1980
Federal Reserve Bank attempts to arrange a
meeting between the applicant and the protestant. The hope is that direct exchanges will help
define the issues in the protest and narrow the
differences. The Board believes that it is in the
best interest of all parties if meetings and negotiations can resolve differences and permit a
withdrawal of the protest. The withdrawal of a
CRA protest, or the withdrawal of an institution's application after a CRA protest is lodged,
does not, however, relieve the Board of its responsibility to evaluate the institution's CRA
performance.
Of the protested CRA cases handled by the
Board, a few have been resolved by direct exchanges between applicant and protestant.
Moreover, experience indicates that direct exchanges do serve to narrow differences and clarify positions, even when they do not resolve the
issues.
Whether or not exchanges between the applicant and the protestant resolve differences, the
System research staff begins an analysis of the
issues raised in the protest. The staff analysis
relies on a variety of data sources. The most
valuable sources of information have been Home
Mortgage Disclosure Act (HMDA) data, bank
consumer compliance examinations, U.S. Census information, protestant and applicant submissions, real estate transfer records, data from
the Department of Housing and Urban Development on Federal Housing Administration mortgage insurance activity, and information from
city planning departments.
The analytical methods used by the System research staff to address the specific issues raised
by protestants vary with the quantity and quality
of data. The primary source of information on
housing-related loan activity by an applicant and
other institutional lenders in a geographic area is
HMDA statements. The Home Mortgage Disclosure Act requires that institutional lenders
covered by the act disclose their annual residential mortgage and home improvement loan extensions by census tract or zip code. The data allow
users to identify the number and dollar volume of
housing-related loans in various areas of an
applicant's delineated community and beyond.
Those protestants that have alleged failure by an
applicant to serve the residential credit needs of
the entire community have based their argu
ments largely on statistical analysis of the applicant's HMDA statements.
The essential problem with HMDA statements
is that they provide no information about the level of, or variations in, housing loan demand
across neighborhoods. This shortcoming is not
surprising because the data were not designed for
that purpose. Many of the protestants have recognized this critical shortcoming and have attempted to control for variations in demand by
presenting the HMDA loan patterns on a per capita or per housing unit basis.
System research staff recognizes the difficulties that arise in attempting to control for variations in housing credit demand across neighborhoods. The staff analysis makes use of bank loan
applications and available records of real estate
deed transfers. Variation in loan application levels across neighborhoods is one indicator of geographic differences in demand for an institution's
credit. The reliability of application data as a
measure of credit demand rests critically on the
absence of prescreening, the perceptions of the
bank by the residents of the community, the extent of promotional activity by the institution,
and the actions of competitors in various neighborhoods.
The number of real estate transfers in a neighborhood during a given period of time closely approximates the potential number of real estate
exchanges that lending institutions could have financed in an area. As such, that number provides a rough measure of the effective demand
for mortgage credit in a neighborhood. Although
the number of deed transfers may be a proxy for
mortgage credit demand, it is an imperfect one.
Some property sales involve installment contracts and do not show up in deed transfer records at the time of the sale. In addition, deed
transfers reflect only those transactions that actually occur. If the market for first mortgages
is not highly competitive or if regulatory constraints such as usury laws exist, some potential
property exchanges at competitive market prices
might not take place. In that case, deed transfer
records may understate potential demand. The
research staff has used ratios of mortgage loans
to transfers for cross-sections of neighborhoods
as an indicator of an applicant's efforts to meet
the housing credit needs of the local community.
The research staff also focuses on other loan
Community
extensions that relate to the CRA—for example,
loans to small businesses and for consumer installment purchases, community development,
and farm purposes. The CRA review by the research staff goes beyond an analysis of the applicant's lending activity and addresses each of the
other assessment factors listed in Regulation BB.
Emphasis in the assessment process is placed on
the applicant's promotional and marketing efforts in the low- and moderate-income sections
of its community. In addition, the applicant's
systematic efforts to survey the credit needs of
its entire community are important to the CRA
review. After assessing an applicant's entire
CRA performance, including the findings of completed CRA examinations, the research staff
makes a recommendation to the Board on the
CRA section of the application.
BOARD EXPERIENCE
CRA
PROTESTS
TO DATE:
Community organizations and citizens groups
have actively voiced their concerns when they
have perceived a lending problem that appeared
to be covered by the CRA. These perceptions
have been manifested in several protests lodged
against banking organizations filing applications
with the Board. The Board's experience with
such protests has, however, been limited. As of
January 15, 1980, the Board had acted on three
cases involving CRA protests that could not be
resolved by meetings and negotiations; they involved Ohio Citizens Trust Company, Toledo,
Commerce Bancshares, Kansas City, Mo., and
Michigan National Corporation, Bloomfield
Hills, Michigan. CRA protests involving MidContinent Bancshares and Landmark Bancshares were withdrawn in October and November 1979, respectively, following successful negotiations b e t w e e n the a p p l i c a n t s and the
protestants. In July 1979 a third protest based on
CRA issues, involving the Trust Company of
Georgia in a proposed nonbank acquisition under
section 4(c)(8) of the Bank Holding Company
(BHC) Act, was resolved through negotiation.
Currently, the Federal Reserve System has five
unresolved CRA protests. They involve AmeriTrust Corporation, First National Boston Corporation, Manufacturers Hanover Trust Company,
Reinvestment
Act
91
Ohio Citizens Trust Corporation (for the second
time), and Society Corporation of Cleveland. Ten
of the eleven CRA protests have been lodged by
community groups. The protest involving First
National Boston Corporation was brought by a
competitor of its proposed acquisition in New
Bedford, Massachusetts. The discussion that follows is based on a review of the six CRA protests
that have been resolved by negotiated settlement
or decided by the Board.
CRA PROTESTS
RESOLVED
BY BOARD
ORDERS
As of January 15, Board orders had been issued
on three applications that had spurred CRA protests that had not been withdrawn. The first protested application to come before the Board involving C R A i s s u e s was lodged by the
Manchester-Tower Grove Community Organization of St. Louis, an affiliate of the Missouri Association of Community Organizations for Reform
Now (ACORN), against Manchester Financial
Corporation, also of St. Louis. The ACORN protest alleged primarily that the corporation's
lead bank, Manchester Bank, and two subsidiary
banks located within St. Louis had not adequately served the convenience and needs of their
entire community. The protestant's submission
focused on the Manchester Bank's limited extension of mortgage, home improvement, and
small business loans in the Manchester-Tower
Grove area of St. Louis.
An interesting aspect of the Manchester case is
that the receipt of the application in August 1977
predated the passage of the CRA. Moreover, the
protest itself was lodged well before the CRA became effective in November 1978. During the
hearings on the CRA bill, the Board expressed
the view that the existing convenience-and-needs
standard in section 3(a) of the Bank Holding
Company Act required the Board to consider
whether applicants were helping to meet the
credit needs of their communities. The Board
granted the interested parties an informal public
hearing, which took place in St. Louis in March
1978.
ACORN requested that the Board either deny
the application or condition an approval upon
detailed written commitments by the applicant
92
Federal Reserve Bulletin • February 1980
promising to improve its record of meeting the
credit needs of the Manchester-Tower Grove
neighborhoods. ACORN proposed that the applicant's commitments include the establishment of
a community advisory committee at the bank,
the appointment of a community reinvestment
officer, the adoption of an affirmative marketing
program of housing-related credit in the Manchester-Tower Grove neighborhood, and a listing of the criteria and specific terms of housing
and small business loans.
Board analysis revealed that, despite the Manchester Bank's emphasis on commercial and industrial loans and the exodus in recent years of
business and industry from the bank's local service area, the applicant had not ignored the retail
credit needs of the individuals in its local community. In addition, the Board found that the
Manchester Bank had been active in extending
residential credit in low- and moderate-income
areas, including the protestant's section of the
community. Staff analysis revealed that, as of
March 31, 1978, the Manchester Bank had extended a greater number of residential real estate
loans in the zip code area that contained the
Manchester-Tower Grove neighborhoods than
in any other zip code area in its entire market.
These 52 loans represented 17.3 percent of the
bank's total residential loans by number and 11.4
percent by dollar volume. Taking account of the
applicant's overall loan record and other supportive evidence, such as the bank's participation in a nonprofit housing corporation and its efforts to maintain and promote a redevelopment
corporation in the city, the Board approved the
Manchester applications.
The Board order in the Manchester case explicitly stated the Board's position with respect
to its responsibilities under both the CRA and
the convenience and needs section of the Bank
Holding Company Act as shown in the following
quotation from the F E D E R A L RESERVE B U L L E T I N ,
volume 64, July 1978, p. 579:
The Board finds nothing in the BHC Act that
requires or authorizes the Board to dictate a
bank's product mix (which credit or deposit
services a bank should emphasize) or to dictate
what proportion or amount of an institution's
funds must, or even should, be allocated to any
particular credit need, borrower or neighborhood, or on what specific terms credit should be
extended. The law permits each bank to choose
how it should fulfill its responsibility to help
meet the convenience and needs (including the
credit needs) of its community. The Board's responsibility under the BHC Act as well as the
CRA is to evaluate the record(s) of applicant and
bank(s) involved and to determine whether the
convenience and needs of the community have
been and are likely to be served.
The second CRA protest resolved by the
Board involved a protest filed by the Greater Toledo Housing Coalition against the Ohio Citizens
Trust Company. The principal allegation by the
protestant was that the applicant's policies for
mortgage and home improvement lending had
the effect of discriminating against minorities
and older neighborhoods. The protestant's contentions were based on an analysis of the applicant's HMDA records. Analysis by the Federal
Reserve Bank of Cleveland disclosed the fact
that the applicant had extended comparatively
few housing loans in the low- and moderate-income sections of the community.
The staff analysis noted that several factors,
including the percentage of owner-occupied residences, low average household income, and extensive demolition owing to urban renewal projects, had contributed to the applicant's low level
of activity in these neighborhoods. In addition,
the higher rejection rate for mortgage loans in
low- and moderate-income areas, compared with
the rate in other neighborhoods, did not appear
to stem from discriminatory or unreasonable
lending standards. The Board order noted that
the applicant's marketing practices revealed no
intent or effort to discourage loan applications
from low- and moderate-income neighborhoods.
Nonetheless, the Board concluded that the applicant had not appeared to make a sufficient effort
to lend in the low- and moderate-income sections
of its community and that its lending activity
there was low in certain respects. Acting on
these findings, the Board obtained a commitment
from the applicant to increase its efforts to communicate with members of its community, thereby enabling the applicant to better serve the
credit needs of its low- and moderate-income
neighborhoods. Given the applicant's commitments and other positive aspects of the record,
the Board approved the Ohio Citizens application.
Community Reinvestment
A recent CRA protest resolved by the Board
involved a protest lodged by the Michigan Committee on Law and Housing against Michigan
National Corporation. The five applications
raised no significant competitive problems. The
only issue was whether the applicant's record
was acceptable in light of the Community Reinvestment Act.
The protestant set out four allegations. The
first charged that longstanding violations of procedural requirements of HMDA and CRA regulations indicated a negative management attitude
toward the CRA. The second allegation challenged the community delineation by the applicant's Oakland subsidiary, which it argued, arbitrarily excluded some low- and moderate-income
areas located in Pontiac from its community delineation. The third allegation charged that the
applicant's nine Detroit-area banking subsidiaries had failed to provide adequate housingrelated credit to low- and moderate-income
neighborhoods throughout the greater Detroit
area. The protestant's submissions used data derived from the 1970 Census and the applicant's
HMDA statements to support this contention.
For example, the protestants used the ratio of
mortgage loans to housing units to demonstrate
that the applicant's largest Detroit subsidiary
granted about 14 times as many loans in census
tracts with above moderate income as it did in
low- and moderate-income tracts. The protestant's final charge was that the applicant had engaged in racial discrimination in its housing-related lending in the Detroit tri-county region.
Prior to the Board's action last November, the
Federal Reserve Bank of Chicago arranged a series of meetings between the protestant and the
applicant in the hope of resolving the protest. Although agreement was reached on five commitments, Michigan National Corporation refused to alter the Oakland community delineation or to accept the protestant's demand that
the applicant equal or better the lending record
of every other bank in Detroit for every type
of housing-related credit it offered.
An important aspect of the Board's decision
was the reaffirmation of the position that the
Board had taken in the Commerce Bancshares
CRA protest. The Michigan National Corporation submission asserted that its lending performance before November 6, 1978, the effective
Act
93
date of the CRA, should not be considered by the
Board. The Board found no merit in this assertion, noting that it believed the convenience-andneeds standard contained in section 3 of the
Bank Holding Company Act of 1956 required
consideration of an applicant's record in meeting the credit needs of its community.
In considering the CRA record of the Michigan
National Corporation the Board examined the
submissions of both the protestant and the applicant, and reviewed the results of a consumer
compliance examination of each of the applicant's banking subsidiaries by the Office of the
Comptroller of the Currency. From the entire
record the Board found that some of the applicant's banking subsidiaries had failed to comply
with all of the procedural requirements of the
CRA and HMDA. The Board viewed this noncompliance as a serious matter and indicated that
the applicant should be in full compliance before
consummation of the applications. The Board
further found that the community delineation by
the Oakland subsidiary was reasonably based on
the bank's total lending pattern. In addition,
the Board noted that the low- and moderateincome neighborhoods that were alleged to have
been excluded were incorporated into the lending area of another of the applicant's subsidiary
banks, Michigan National Bank-North Metro.
The Board analysis also focused on the two allegations about mortgage lending patterns. The
Board found that the applicant's record of extending mortgage credit in different areas
grouped by median family income partially reflected variations in mortgage demand across
these neighborhoods, and the applicant's mortgage lending pattern appeared to reflect the
pattern of applications it received. Further, the
Board noted that the applicant's mortgage lending
in low- and moderate-income areas was somewhat better than the average for other large
Detroit lending institutions. Yet Board analysis
revealed several weaknesses in the applicant's
record that may have contributed to the disparate lending levels across neighborhoods.
These included the applicant's failure systematically to determine the residental credit needs
of the Detroit area and the deposit orientation of
its advertising. The Board order stated that the
applicant should broaden its efforts to make
creditworthy loans in the low- and moderate-
94
Federal Reserve Bulletin • February 1980
income areas of its community. The Board
found that, in light of other information, the
statistics submitted by the protestant did not
permit a conclusion that racial discrimination
had occurred and that there was no evidence of
such discrimination against particular applicants.
An important aspect of the Board action was
its view regarding the protestant's demand that
the applicant achieve specified levels of housingrelated lending. The Board did not regard the imposition of such requirements as appropriate and
did not believe that the CRA required such commitments.
Michigan National Corporation made several
commitments to the Board designed to remedy
deficiencies in its CRA performance. These commitments involved an increase in its credit-oriented marketing efforts in low- and moderate-income areas, participation in additional special
lending programs, and designation of CRA officers to meet with the public regarding the applicant's CRA performance. Upon consideration of
these commitments and other positive aspects of
the applicant's overall record in serving its community, the Board approved the Michigan National Corporation applications.
BOARD EXPERIENCE
NEGOTIATED CRA
IN
SETTLEMENTS
Three of the eleven CRA protests have been resolved by direct negotiation between the protestants and applicants. The first CRA protest to be
withdrawn following negotiations involved the
Trust Company of Georgia. The applicant's proposed section 4(c)(8) acquisition of Fickling and
Walker Incorporated, a mortgage company, was
protested by a community organization, the Citywide L e a g u e of N e i g h b o r h o o d s , of A t l a n t a ,
Georgia. The protestant alleged that the applicant's lead banks and wholly owned mortgage
banking subsidiary, Adair Mortgage Company,
had failed to meet the credit needs of low- and
moderate-income neighborhoods in Atlanta. As
the result of direct negotiations between the applicant and protestant, "applicant agreed to initiate and promote a mortgage lending program in
low- and moderate-income neighborhoods in Atlanta and to consult with the protestant in the fu
ture with respect to providing credit and other
services in such areas." After the satisfactory
outcome of the negotiations, the community
group withdrew its protest. (See Federal Reserve
press release dated July 16, 1979.)
Prior to the application by the Trust Company
of Georgia, the Board had determined in a Citicorp application protested by Connecticut Bankers Association that section 4(c)(8) applications
are not covered by the CRA. However, because
the protest was withdrawn, the Board did not
consider whether this protest needed to be given
any weight under the statutory considerations
governing section 4(c)(8) cases. (See FEDERAL
RESERVE BULLETIN, volume 65, June 1979, page
511.)
The second CRA protest to be withdrawn following direct negotiations was lodged by the
East St. Louis Neighborhood Development Corporation against Mid-Continent Bancshares, Inc.
The community group had two principal concerns: first, that the applicant's Belleville Subsidiary, Belleville National Savings Bank (BSNB),
had failed to include St. Clair County in its community delineation; and second, that BSNB had
failed to serve adequately the residential credit
needs of the residents of East St. Louis.
As the result of a series of direct exchanges
between the East St. Louis Community Group
and BSNB, a negotiated settlement of the CRA
protest was reached in October 1979 and the protest was withdrawn. In the settlement, BSNB
agreed to expand its local community delineation
to include St. Clair County and to undertake an
affirmative action program applicable to residents of East St. Louis. As a cornerstone to the
agreement, BSNB committed itself to cooperate
to improve the availability of residential real estate loans and small business loans to St. Clair
County residents. The agreement included specific steps that BSNB was to undertake in its affirmative action program. Specific commitments
included expanding the bank's credit-oriented advertising program, sending letters to realtors advising them of BSNB's willingness to extend
residential loans to creditworthy applicants,
conducting up to 10 credit-oriented educational
workshops in East St. Louis in 1980, and participating on a voluntary basis with other lenders in
St. Clair County in workshops or meetings origi-
Community
nated by the protestant to discuss credit and
banking needs of residents of East St. Louis.
The most recent CRA protest to be withdrawn
as a result of a negotiated settlement was lodged
by the Missouri Association of Community Organizations for Reform Now against Landmark
Bancshares Corporation of Clayton, Missouri.
The protest focused on the .protestant's belief
that the applicant would use the purchase of the
suburban Ladue Bank and Trust Company as a
means to remove the assets of the applicant's
Wellston subsidiary. In addition, the protestant
alleged that the applicant had a "poor lending
record" in Wellston. After a series of meetings, a
wide-ranging agreement was reached between
the applicant and the protestant. The applicant's
Wellston subsidiary promised to reserve approximately $1 million in 1980 for home improvement
and mortgage loans to qualified borrowers and to
offer FHA title I and FHA title II home improvement loans with a x h percent discount in the protestant's community. The institution promised to
hire a full-time community investment coordinator whose responsibilities include counseling for
depositors and borrowers, handling complaints,
and writing a quarterly report to the protestants
on the bank's progress in meeting its commitments. The applicant also agreed to pay all the
expenses related to locating and hiring a city
planning group for the Wellston community, to
provide the start-up funds and other support to
establish a Wellston chamber of commerce, to
adopt more flexible loan standards, to extend its
Saturday office hours in the local community,
and to continue its efforts to establish a job training program in the local area.
PROBLEMS
AND
PROSPECTS
Much uncertainty has been associated with the
implementation of Regulation BB. Many of these
questions have not yet been resolved, and given
the Board's limited experience with CRA protests, it is difficult to draw conclusions about how
specific issues raised in a protest will be treated.
One area of uncertainty is Board reaction to
voluntary commitments between applicants and
protestants. In general, the Board desires to see
the issues raised in a CRA protest settled through
Reinvestment
Act
95
meetings and negotiations. Experience indicates
that negotiations between the parties in such cases can be successful. In July, October, and November 1979, CRA protests were successfully resolved through negotiation. In these cases, the
applicants made a series of commitments to the
protestants that became a part of the record and
are thus subject to review by the appropriate supervisory agency. The Board may determine that
specific commitments by a member institution
are inconsistent with basic safety-and-soundness
considerations or with the intent of the CRA.
The legislative history of the CRA clearly indicates that the Congress did not intend the act to
become a vehicle for credit allocation. Three of
the commitments reached in the Landmark negotiations raise the specter of credit allocation.
First, the applicant's Wellston subsidiary agreed
to earmark $1 million for conventional housing-related loans and to offer these funds at a
discount set V2 percent below the prevailing
competitive rates to borrowers who reside in
Wellston. Second, the applicant agreed to offer
similar below-market interest rates on FHA title
I and FHA title II home improvement loans in
the Wellston section of the applicant's lending
area. Finally, the applicant promised not to take
any direct or indirect action to remove deposits
from the applicant's Wellston subsidiary. The order in the Landmark case clearly reflected the
Federal Reserve System's view with respect to
credit allocation (Federal Reserve Bank of St.
Louis, news release, November 30, 1979):
In assessing applicant's record of serving the
convenience and needs of its communities, the
Reserve Bank has taken note of applicant's disposition to consult and cooperate with community representatives. However, since the Board
of Governors has stated that neither the Bank
Holding Company Act nor the Community Reinvestment Act, 12 U.S.C. §§ 2901 et seq., requires that the Board impose commitments to allocate credit, the Reserve Bank does not
endorse any term of the agreement between applicant and protestant which may have such a
result.
(See also the CRA information statement in the
January 1980 B U L L E T I N ; the Board's press release on Michigan National Corporation, November 30, 1979; and "Commerce Bancshares,
96
Federal Reserve Bulletin • February 1980
Inc.," F E D E R A L RESERVE B U L L E T I N , volume
63, July 1978, pages 576-83.)
Aside from the area of commitments, a number of significant issues related to the evaluation
of an applicant's CRA record need to be resolved
in Board actions. The Board has yet to decide
how much weight to give particular factors in the
CRA assessment process. For example, how
might an institution's strong performance in
home improvement lending in low- and moderate-income neighborhoods be weighed against a
poor record of first mortgage lending in the same
communities? How might the Board view two
similar institutions—one with a poor mortgage
lending record in low- and moderate-income
areas and the other with no lending record at all
because the institution chose not to offer mortgage credit as one of its services? If the latter
institution is viewed more favorably in terms of
the CRA, will that action induce the former institution to drop out of the mortgage business?
Even more fundamentally, what constitutes a
satisfactory residential lending record? Does a
favorable comparison with the experience of
lending by other local lenders constitute a satisfactory record, or is some absolute level of lending the measure of a bank's performance? Finally,
should an institution that closes unprofitable
branches in low- and moderate-income neighborhoods get a negative rating on this CRA assessment factor?
It is expected that Board decisions will begin
to provide some guidance about the types and
amount of information that will be required before an adequate analysis of the record has been
developed. From the perspective of the public interest, it is necessary to determine at what point
the costs of additional expenditures on a CRA
evaluation are likely to exceed the benefits in
terms of formulating a more extensive record upon which to decide a case. An important dimension of the cost of deciding a protested application is the six- to ten-month lag between the
time the application is submitted and a Board order is issued.
Another area of concern is the potential for
abuse of the CRA protest process by competitors
of applicants. A CRA protest by a competing
banking organization could be an attempt to
delay Board action on an applicant's proposal.
To date, one of the eleven CRA protests received
by the Board has been submitted by a banking
organization. The Congress did not intend the
CRA to be used by competing organizations as a
device to delay action on applications. Thus a
proliferation of such protests would raise important questions regarding an abuse of the act.
A final area of concern, closely related to the
CRA, is the future of the Home Mortgage Disclosure Act. That act was given a four-year trial
period and is scheduled to expire in June 1980.
To date, the act has not been renewed, nor have
reports on a cost-benefit analysis been completed.
•
97
The Redefined Monetary Aggregates
Thomas D. Simpson of the Board's Division of
Research and Statistics prepared this article.
The Federal Reserve has redefined the monetary
aggregates. This action was prompted by the
many financial developments that have altered
the meaning and reduced the significance of the
old measures. Some of these developments have
been associated with the emergence in recent
years of new monetary assets—for example, negotiable order of withdrawal (NOW) accounts
and money market mutual fund shares; others
have altered the basic character of standard monetary assets—for example, the growing similarity
of and the growing substitution between the deposits of thrift institutions and those of commercial banks. 1 In the process of redefinition, a
set of proposals by the staff of the Board of Governors was published in January 1979.2 Comments on these proposals received from the public and from invited experts, together with
deliberations within the Federal Reserve System
and further research by Federal Reserve staff,
contributed to the Board's selection of the newly
defined measures.
Given the changes in financial practices in recent years, the new measures should aid both the
Federal Reserve and the public in interpreting
monetary developments. However, many of the
changes in the payments mechanism and in the
character of financial assets that necessitated
such a redefinition—some of which are ongoing—have also added significantly to the com1. A discussion of many of these developments can be
found in "A Proposal for Redefining the Monetary Aggregates," F E D E R A L R E S E R V E B U L L E T I N , vol. 65 (January
1979), pp. 14-17.
2. See "A Proposal," pp. 13-42. The potential need for
redefinition, in light of numerous financial innovations, was
recognized by the Advisory Committee on Monetary Statistics. See Improving
Advisory Committee
the Monetary
on Monetary
Aggregates:
Report of the
Statistics (Board of Gover-
nors of the Federal Reserve System, June 1976), pp. 5-6,
9-12.
plexity of the monetary system. As a consequence, it is recognized that no one set of
monetary aggregates can satisfy every purpose
or every user. For this reason, the principal components of the new measures, along with several
related series, will be published regularly with
the new aggregates. In this way, users will be
able to analyze separately the components and to
construct alternative measures.
The first section presents the new aggregates
and compares them with the old measures. There
follows a discussion of the rationale underlying
the redefinition and then an examination of the
historical behavior of the new aggregates. A final
section discusses some technical issues associated with the redefined measures: consolidation
and seasonal adjustment procedures used in constructing the redefined aggregates and new data
sources used in the redefinition. Three appendix
tables contain annual and quarterly rates of
growth of the new measures and their old counterparts.
THE NEW MONETARY
AGGREGATES
Four newly defined monetary aggregates replace
the old M-l through M-5 measures, and in addition, a broad measure of liquid assets has been
adopted. The new aggregates are presented in
table 1. Two narrow transaction measures,
M-l A and M-1B, have been adopted. M-l A is
basically the same as the old M-l aggregate, except that it excludes demand deposits held by
foreign commercial banks and official institutions. 3 The other narrow measure—M-lB—adds
to M-l A interest-earning checkable deposits at
all depositary institutions—namely, NOW accounts, automatic transfer from savings (ATS)
3. The removal of demand deposits due to foreign commercial banks and official institutions follows a recommendation of the Advisory Committee on Monetary Statistics. See
Improving
the Monetary
Aggregates:
Report,
pp. 15-19.
98
Federal Reserve Bulletin • February 1980
accounts, and credit union share draft balances—as well as a small amount of demand deposits at thrift institutions that cannot, with present
data sources, be separated from interest-earning
checkable deposits. 4 The new M-2 measure adds
to M-1B overnight repurchase agreements (RPs)
issued by commercial banks and certain overnight Eurodollars held by U.S. nonbank residents, 5 money market mutual fund shares, and
savings and small-denomination time deposits at
all depositary institutions. 6 Also, in order to
avoid double counting of some deposits in this
aggregate, the construction of the new M-2 involves subtracting a consolidation component—
an estimate of those demand deposits used by
thrift institutions in servicing their savings and
time deposit liabilities included in this aggregate. 7 Redefined M-3 is equal to new M-2 plus
large-denomination time deposits at all depositary institutions (including negotiable CDs) plus
term RPs issued by commercial banks and savings and loan associations. 8 Finally, the very
broad measure of liquid assets, L, equals new
M-3 plus other liquid assets consisting of other
4. M-1B is the same as the M-l measure that was proposed
by the Board staff in January 1979. See "A Proposal," pp.
17-20.
5. Overnight Eurodollars in M-2 are those issued by Caribbean branches of member banks. Other overnight Eurodollars and longer-term Eurodollars of U.S. residents are
included in the broad measure of liquid assets, L. Data on
overnight Eurodollars included in M-2 are available on a
timely basis, but data on other Eurodollars—at both U.S. and
non-U.S. banks abroad—are available only with a lengthy lag
and do not permit a separation of overnight from term Eurodollars. As improved data sources become available, adjustments may be made to the new measures. For example,
the possible inclusion of Eurodollars held by nonresidents
other than banks and official institutions could be reviewed.
Moreover, with Eurodollar data on a more timely basis, consideration could be given to including Eurodollars of maturities longer than overnight in a broader monetary aggregate,
rather than only in L.
6. Small-denomination time deposits are those issued in
denominations of less than $100,000. Depositary institutions
are commercial banks (including U.S. agencies and branches
of foreign banks, Edge Act corporations, and foreign investment companies), mutual savings banks, savings and loan associations, and credit unions.
7. At present, because of the small amount of checkable
deposits at thrift institutions, this M-2 consolidation adjustment removes all demand deposit holdings of mutual savings
banks and savings and loan associations. See the section on
technical issues for a further discussion of consolidation procedures.
8. Large-denomination time deposits are those issued in
denominations of $100,000 or more.
1. New measures of money and liquid assets1
Billions of dollars, not seasonally adjusted, November 1979
Aggregate and component
Amount
M-1A
Currency
Demand deposits2
372.2
106.6
265.6
M-1B
M-1A
Other checkable deposits3
387.9
372.2
15.7
M-2
M-1B
Overnight RPs issued by commercial banks
Overnight Eurodollar deposits held by U.S. nonbank
residents at Caribbean branches of U.S. banks
Money market mutual fund shares
Savings deposits at all depositary institutions
Small time deposits at all depositary institutions4
M-2 consolidation component5
1,510.0
387.9
20.3
M-3
M-2
Large time deposits at all depositary institutions6
Term RPs issued by commercial banks
Term RPs issued by savings and loan associations
1,759.1
1,510.0
219.5
21.5
8.2
L
2,123.8
1,759.1
M-3
Other Eurodollar deposits of U.S. residents other
than banks
Bankers acceptances
Commercial paper
Savings bonds
Liquid Treasury obligations
3.2
40.4
420.0
640.8
-2.7
34.5
27.6
97.1
80.0
125.4
1. Components of M-2, M-3, and L measures generally exclude
amounts held by domestic depositary institutions, foreign commercial
banks and official institutions, the U.S. government (including the
Federal Reserve), and money market mutual funds. Exceptions are
bankers acceptances and commercial paper for which data sources
permit the removal only of amounts held by money market mutual
funds and, in the case of bankers acceptances, amounts held by accepting banks, the Federal Reserve, and the Federal Home Loan
Bank System.
2. Net of demand deposits due to foreign commercial banks and
official institutions.
3. Includes NOW, ATS, and credit union share draft balances and
demand deposits at thrift institutions.
4. Time deposits issued in denominations of less than $100,000.
5. In order to avoid double counting of some deposits in M-2, those
demand deposits owned by thrift institutions (a component of M-1B),
which are estimated to be used for servicing their savings and small
time deposit liabilities in M-2, are removed.
6. Time deposits issued in denominations of $100,000 or more.
Eurodollar holdings of U.S. residents other than
banks, 9 bankers acceptances, commercial paper,
savings bonds, and marketable liquid Treasury
obligations. 10
9. Consists of Eurodollar deposits held by U.S. nonbank
residents (other than those included in M-2) at all banking
offices in the United Kingdom and Canada and at branches of
U.S. banks in other countries, which account for nearly all
holdings of U.S. residents other than banks. See note 5.
10. In general, the components of M-2, M-3, and L exclude
amounts held by depositary institutions, money market mutual funds, the federal government (including the Federal Reserve), and foreign commercial banks and official institutions.
Marketable liquid Treasury obligations are those with less
than 18 months remaining to maturity.
The Redefined Monetary Aggregates
2. Relation between new and old monetary
aggregates
Billions of dollars, not seasonally adjusted, November 1979
Aggregate and component
Old M - l
Less demand deposits of foreign commercial
banks and official institutions
EQUALS: N e w M - 1 A 1
Plus other checkable deposits
EQUALS: N e w M - 1 B
Old M-2
Plus savings and time deposits at thrift institutions
EQUALS: O l d M - 3
Plus
Plus
Plus
Less
overnight RPs and Eurodollars
money market mutual fund shares
demand deposits at mutual savings banks2
large time deposits at all depositary institutions
in current M-3
Less demand deposits of foreign commercial banks and
official institutions
Less consolidation component3
EQUALS: N e w M - 2
Plus large time deposits at all depositary institutions
Plus term RPs at commercial banks and savings and loan
institutions
EQUALS: N e w M - 3
MEMO
Old M - 2
Plus negotiable CDs at large commercial banks
EQUALS: O l d M - 4
Old M-3
Plus negotiable CDs at large commercial banks
EQUALS: O l d M - 5
Amount
382.6
10.4
372.2
15.7
387.9
945.3
664.2
1,609.5
23.4
40.4
1.0
151.2
10.4
2.7
1,510.0
219.5
29.8
1,759.1
945.3
95.9
1,041.2
1,609.5
95.9
1,705.4
1. Also includes a very small amount of M-l-type balances at certain U.S. banking offices of foreign banks outside New York City
which were not in the old M-l measure.
2. Demand deposits at mutual savings banks were not included in
any of the old monetary aggregates.
3. Consists of an estimate of demand deposits included in M-1B
that are held by thrift institutions for use in servicing their savings and
small time deposit liabilities included in the new M-2.
The relation between the redefined and the old
monetary aggregates is shown in table 2. As already noted, the new M-l A measure is very similar to the old M-l and differs in excluding demand deposits owned by foreign commercial
banks and official institutions. 11 M-1B thus differs from the old M-l, on the one hand, by excluding these deposits, and on the other, by including other checkable deposits at both
commercial banks and thrift institutions. New
M-2 is closer in concept to old M-3, which included savings and time deposit liabilities of all
depositary institutions (other than negotiable
CDs at large commercial banks), than it is to old
M-2, which excluded the public's holdings of
these liabilities of thrift institutions. The major
11. The new M - l A also includes a very small amount of
M - l - t y p e balances at certain U . S . banking offices of foreign
banks outside N e w York City, which are not in the old M - l .
99
differences between the new M-2 and old M-3
measures are that new M-2 includes money market mutual fund shares, overnight RPs, and overnight Eurodollars—none of which appeared in
any of the old monetary aggregates—and that it
excludes all large-denomination time deposits.
The only class of large-denomination time deposits not included in the old M-3 (and the old M-2)
measure was negotiable CDs at large commercial
banks, which amounted to $95.9 billion in November 1979; as table 2 shows, that measure contained $151.2 billion of other large-denomination
time deposits at both commercial banks and
thrift institutions. By including all large-denomination time deposits at all depositary institutions,
the new M-3 is closer in concept to the old M-5
measure than to the old M-4 (both shown as
memo items in table 2). Of course, the new M-3
aggregate is more inclusive than the old M-5
since it contains RPs, certain overnight Eurodollar deposits, and money market mutual
fund shares.
Some of the new aggregates and their components will continue to be published on a weekly basis while others will be available only
monthly. The publication schedule calls for publication of weekly and monthly data on the new
M-l A and M-1B measures. 1 2 Data on redefined
M-2 and M-3 will be available only on a monthly
basis, on a schedule similar to that for old M-3. 13
In addition, data on the domestic commercial
bank components of the new measures, and on
currency, money market mutual fund shares, and
overnight Eurodollars, will be published on a
weekly basis, while the other components will be
available only on a monthly basis.
UNDERLYING
RATIONALE
The organizing principle underlying the redefined monetary aggregates is that of combining
12. The Federal Reserve intends to publish M - l A and
M-1B on Fridays (except occasionally w h e n holiday periods
are involved), for the statement w e e k ending nine days earlier.
13. Monthly data on the n e w M-2 and M-3 measures normally will be published about 10 to 15 days after the end of
the month. Because of lengthier delays associated with s o m e
of the other components of L, this aggregate will be published
about 6 to 8 w e e k s after the end of each month.
100
Federal Reserve Bulletin • February 1980
similar kinds of monetary assets at each level of
aggregation. This principle has the largest impact
on the new M-1B, M-2, and M-3 measures. Thus
M-1B combines checkable deposits at thrift institutions—NOW deposits, credit union share draft
balances, and demand deposits at mutual savings
banks—with demand, NOW, and ATS balances
at commercial banks. 14 Ordinary savings and
small-denomination time deposits at commercial
banks and thrift institutions are included in the
new M-2. Moreover, money market mutual fund
shares, whose liquidity characteristics are most
like those of savings accounts, are also included
in this measure, as are overnight RPs and Eurodollars. M-3 includes large-denomination time
deposits at both commercial banks and thrift institutions, as well as term RPs. 15
Two M-l measures were adopted primarily because of uncertainties that would arise during a
transition period should NOW accounts be permitted nationwide. NOW accounts have properties of both a transaction account and a savings
account, and thus newly opened NOW accounts
would attract funds both from household demand
deposits and from savings accounts and other liquid assets. 16 Experience with NOW accounts in
New England and New York State clearly indicates that during the transition period, when
the bulk of NOW accounts was opened, growth
in total NOW balances was indeed buoyed by
shifts from savings balances and other liquid assets. This evidence suggests that during a conversion period associated with nationwide NOW
accounts, growth in M-1B could significantly
overstate underlying growth in the public's trans-
14. The Federal Reserve intends to include the volume of
travelers checks of nonbank issuers at the M-l level, once all
major issuers begin submitting such data regularly to the Federal Reserve and once these data have been thoroughly reviewed. Travelers checks likely will be added to the new aggregates in conjunction with a benchmark or annual revision.
15. Available evidence indicates that savings and loan associations are the only thrift institutions with a significant
amount of RP liabilities outstanding. Moreover, nearly all of
the savings and loan RPs are believed to be of the term variety.
16. Turnover data on NOW accounts corroborate this
point. The turnover rate of NOW accounts at both commercial banks and thrift institutions is approximately 10 per
year; for comparison, the turnover rate for ordinary savings
accounts is about 3 per year and that of consumer demand
deposit accounts is estimated to be about 35 per year.
action balances. 17 M-1A, in contrast, would tend
to understate such growth, as households converted demand deposit balances into NOW accounts. In practice, because the extent of the
shift from demand deposits and other accounts to
NOW accounts is uncertain, the availability of
both M-l measures is expected to help in the interpretation of growth in the narrow money stock
during the transition period, should NOW accounts be offered nationwide.
Other financial assets have been recommended
for inclusion at the M-l level, but for several reasons were excluded from the new M-l A and M1B. The most common recommendations have
involved shares in money market mutual funds,
RPs, and certain Eurodollars owned by U.S.
residents. Each of these assets has transactionrelated characteristics. Many money market mutual funds offer their customers check-writing
privileges, subject to a minimum amount per
check, which has typically been $500; and balances placed in overnight RPs and in certain
overnight Eurodollars are available for spending
the next business day. 18
However, these instruments also have attractive characteristics as liquid investments, and
their behavior in many portfolios appears to be
influenced by such considerations. Evidence on
turnover rates indicates that balances in money
market funds turn over much like balances in ordinary savings accounts—about three times per
year—and thus on the average are not being actively used for transaction purposes. 19 Profes17. The problem of seasonal adjustment would also be
magnified by nationwide NOW accounts; the currency and
demand deposit components of M-l A can be seasonally adjusted by using historical data, but historical data on NOW
accounts and the other checkable balances appearing in M-lB
are not yet sufficient for reliable seasonal adjustment. Conversions from demand deposit accounts to NOW accounts
could also influence the seasonal behavior of the demand deposit component of M-l A, should the funds shifted from demand accounts and those funds remaining in these accounts
have different characteristics.
18. Only Eurodollars settled in same-day or immediately
available funds meet this condition. By contrast, an overnight
Eurodollar deposit arranged in clearinghouse funds is not
available for spending for two business days. Because of
time-zone considerations and other conveniences, the bulk of
overnight Eurodollars arranged in immediately available
funds is believed to be at Caribbean branches.
19. Furthermore, empirical research by the staff indicates
that the addition of money market mutual fund shares to
M-1B has not on balance enhanced the performance of this
aggregate since mid-1974.
The Redefined Monetary Aggregates
sional opinion currently is divided over whether
RPs are mainly liquid investments or transaction
balances. Some observers hold that RPs are very
similar to demand deposits and that the unexpected weakness in the public's demand for M-ltype measures at times since the mid-1970s can
be traced largely to the behavior of RPs. Others
stress that in practice RPs are qualitatively different from demand deposits—that they are more
like other short-term investments—and that recent weakness in the public's demand for the
narrow money stock was not mirrored in any
single liquid asset, including RPs. 20
Nevertheless, in recognition of the increasingly prominent role played by these assets and
their potential transaction-related features, data
on money market mutual fund shares, overnight
RPs, and overnight Eurodollars will be conveniently shown along with figures for M-l A and
M-1B, on the first page of the weekly release
containing the money stock measures. Also, these
items will be included in the new M-2 measure,
as noted above.
In addition to money market mutual fund
shares, overnight RPs, and overnight Eurodollars, savings and small-denomination time
20. For those studies emphasizing the transaction properties of RPs, see Peter A. Tinsley, Bonnie Garrett, and Monica
Friar, "The Measurement of Money Demand" (Board of
Governors of the Federal Reserve System, Division of Research and Statistics, Special Studies Section, November
1978; processed); Gillian Garcia and Simon Pak, "Some
Clues in the Case of the Missing Money," American Economic Review, vol. 69 (May 1979), pp. 330-34; and John
Wenninger and Charles Sivesind, "Changing the M-l Definition: An Empirical Investigation" (Federal Reserve Bank of
New York, April 1979; processed). An alternative interpretation can be found in Richard D. Porter, Thomas D.
Simpson, and Eileen Mauskopf, "Financial Innovation and
the Monetary Aggregates," Brookings
Papers
on
deposits are included at the M-2 level. Savings
deposits and small-denomination time deposits
have different liquidity characteristics. 21 Nevertheless, recent innovations—most importantly
the six-month money market certificate and more
recently the 272-year, variable-ceiling certificate—constitute new, attractive alternatives to
holding savings balances and have drawn savings
into these new time deposits at all depositary
institutions. In addition, the six-month money
market certificate has tended to reverse a trend
toward longer maturities of small-denomination
time deposits and thus to increase the overall liquidity of such deposits.
The share of small-denomination time deposits
at commercial banks has been affected by regulatory changes applying to the ceiling rates that
commercial banks have been able to offer on certain time accounts relative to ceilings applicable
to thrift institutions. 22 As a consequence, the historical relationship between the public's demands for small-denomination time deposits at
commercial banks and at thrift institutions has
been altered in ways that cannot be fully determined at this time. Because the small-denomination time deposits at both kinds of institutions are
combined in the M-2 aggregate, along with the
savings deposit liabilities of both, shifts of these
kinds affect only the composition of M-2 and not
its size or rate of growth. Similarly, the growing
availability of money market mutual fund shares
has tended to reduce the public's demand for
savings and small-denomination time deposits at
commercial banks and thrift institutions, but
such shifts are captured within the new M-2 aggregate inasmuch as it includes money market
Economic
Activity, 1:1979, pp. 213-29; Richard D. Porter and Eileen
Mauskopf, "Cash Management and the Recent Shift in the
Demand for Demand Deposits" (Board of Governors of the
Federal Reserve System, Division of Research and Statistics,
Econometric and Computer Applications Section, November
1978; processed); and Thomas D. Simpson, "The Market for
Federal Funds and Repurchase Agreements," Staff Studies
106 (Board of Governors of the Federal Reserve System, July
1979), pp. 43-58. A summary and evaluation of some research on this subject can be found in John H. Kalchbrenner,
"Recent Innovations in Financial Markets and Their Relationship to Money Demand," paper presented at the XI
Meeting of Technicians of Central Banks of the American
Continent, Port-of-Spain, Trinidad, November 19-24, 1978
(Board of Governors of the Federal Reserve System, November 1978; processed).
101
21. Customers can normally withdraw funds from ordinary
savings accounts when they wish, often by telephone,
although depositary institutions have the right to require a
30-day notification before withdrawal. Time deposits, in contrast, are subject to a substantial penalty for withdrawal before maturity.
22. The shares of thrift institutions in small-denomination
time deposits were augmented following the introduction of
the six-month certificate by a regulatory ceiling that permitted them to offer the auction rate on six-month Treasury bills;
by comparison, the ceiling rate on these deposits at commercial banks was 25 basis points below the auction rate.
However, in March 1979 the differential on ceiling rates on
money market certificates was removed—for auction rates on
six-month bills in excess of 9 percent—and the commercial
bank share of these deposits subsequently tended to expand.
102
Federal Reserve Bulletin • February 1980
mutual fund shares. 23 Furthermore, growth in
new M-2 likely would not be affected much by
conversions to NOW accounts, should they become available nationwide, because funds absorbed by these accounts would be drawn mainly
from other kinds of accounts included in this aggregate.
Because it includes large-denomination time
deposits, the new M-3 aggregate is most comparable to the old M-5 measure. The new M-3
also includes term RPs, which have some similarities to large time deposits. The new M-3 definition is based on the view that large-denomination
time deposits and term RPs substitute for each
other in many portfolios and that these items, especially negotiable CDs, are relatively liquid.
The liquid assets, or L, measure adds to M-3
other liquid assets held by the public. 24 Some of
these are liabilities of depositary institutions—
term Eurodollars held by U.S. residents other
than banks and bankers acceptances—while others are obligations of the U.S. Treasury—savings
bonds and liquid marketable debt. 25 The commercial paper component consists of obligations
of a variety of issuers, both financial institutions
and nonfinancial corporations. Some observers
note that such a broad measure of liquid assets is
23. Empirical analyses by the staff indicate that the behavior of new M-2 in recent years, unlike that of old M-2 and
some other measures of money, has generally not departed
far from expectations based on longer-term historical relationships. See David J. Bennett, Flint Brayton, Eileen Mauskopf, Edward K. Offenbacher, and Richard D. Porter,
"Econometric Properties of the Redefined Monetary Aggregates" (Board of Governors of the Federal Reserve System,
Division of Research and Statistics, Econometric and Computer Applications Section, February 1980; processed).
24. In addition, the staff is experimenting with indexes of
liquid assets. In such indexes, a dollar's worth of a highly
liquid asset is given a greater weight than a dollar's worth of a
less liquid one. See William A. Barnett and Paul A. Spindt,
"The Velocity Behavior and Information Content of Divisia
Monetary Aggregates" (Board of Governors of the Federal
Reserve System, Division of Research and Statistics, Econometric and Computer Applications and Special Studies Sections, January 1980; processed).
25. Eurodollar deposits of U.S. residents other than
banks, except those overnight Eurodollars that are already
incorporated at the M-2 level, might appropriately be included in the new M-3 measure, since they share many characteristics with domestically issued, large-denomination time
deposits. However, lags on obtaining data on such Eurodollars are much longer than for the other components of this
aggregate, and staff work suggests that estimations of this
component based on information that might be available on
an earlier schedule would be subject to large revisions.
especially meaningful because many financial innovations in recent years have altered the public's demands for narrower measures. They argue that these kinds of shifts are absorbed in a
very broad aggregate, such as L, because reductions in demands for narrower measures of money are mirrored in increases in the demands for
other components of the broadest measure, leaving demand for the total unaffected. Others, who
focus on the volume of credit, view such an aggregate as a better reflection of the amount of
credit extended to the economy, both through the
commercial banking system and through other
channels.
HISTORICAL
THE NEW
BEHAVIOR OF
AGGREGATES
An examination of the growth rates and velocities of the new measures affords a better understanding of their behavior and their relationship
to the old measures. 26 Chart 1 shows the growth
rates of M-1A and M-1B and old M-l. 2 7 All three
narrow measures have generally moved closely
together. In recent years, M-1B has tended to increase more rapidly than either M-l A or old M-l
because of growth of NOW and ATS accounts.
During 1979, for example, with shifts in holdings
of monetary assets in response to the availability
of new deposit services, M-1B expanded at a rate
that was 2 l h percentage points faster than M-1A
and old M-l; this difference reflected conversions to NOW accounts in New York State
and to ATS accounts nationwide. 28 Average
rates of growth of these measures over two long
periods and several cycles are shown in table 3.
The three growth rates have been very similar to
one another, both on a trend and on a cyclical
basis, except in the most recent expansion; at
that time, as the public adjusted to new deposit
26. For econometric evidence on the new aggregates, see
Bennett and others, "Econometric Properties."
27. Appendix table 1 contains growth rates for these aggregates annually over the years 1960-79 and quarterly over
the years 1973-79.
28. A portion of this differential in growth rates can be attributed to conversions from demand deposit accounts to
ATS and NOW accounts, and the remainder represents shifts
from ordinary savings accounts and other liquid assets.
The Redefined Monetary Aggregates
103
1. Rates of growth of new and old M-1
Percent
'59
'63
'61
71
75
79
P Peak.
T Trough.
Data are seasonally adjusted at annual rates.
services, average annual growth in M-1B exceeded growth in M-l A and old M-l by slightly
more than 3U percentage point. Should NOW account powers be permitted nationwide, a wider
differential in rates of growth between M-l A and
M-1B could persist for some time.
The public's demands for these M-l measures
relative to the gross national product vary inversely with their velocities, which are shown in
chart 2. Shown also is the Treasury bill rate, representing the return on a money market alternative to holding M-l balances. Since growth in
3. Trend and cyclical behavior of growth rates of new and old measures of money
Average annual rates of growth in percent
New
M-1A
New
M-1B
Old
M-l
New
M-2
Old
M-2
Old
M-3
New
M-3
Old
M-4
Old
M-5
1960-79
1960-69
1970-79
4.9
3.7
6.0
5.1
3.8
6.4
4.9
3.8
6.1
8.3
6.9
9.6
7.6
6.2
8.9
8.5
7.0
9.9
9.0
7.2
10.8
8.1
6.5
9.6
8.8
7.2
10.3
Peak to trough1
1960 Q2-1961 Q1
1969 Q4-1970 Q4
1973 Q4-1975 Q1
1.9
4.8
4.2
1.9
4.8
4.3
1.9
4.8
4.4
6.5
5.7
6.2
5.6
7.1
7.3
7.1
7.2
7.3
7.0
8.7
8.2
5.7
9.8
9.7
7.2
8.9
8.8
Trough to peak2
1961 Ql-1969 Q4
1970 Q4-1973 Q4
1975 Ql-1979 Q43
4.2
6.8
6.2
4.2
6.8
7.1
4.2
6.9
6.3
7.2
10.8
10.6
6.7
10.1
9.1
7.3
11.4
10.3
7.5
12.9
10.6
7.0
11.8
8.1
7.5
12.5
9.7
Period
1. Averages of annualized quarter-to-quarter rates of growth. The base quarter for each calculation is the quarter following the peak (peak is
first quarter shown).
2. Averages of annualized quarter-to-quarter rates of growth. The base quarter for each calculation is the quarter following the trough (trough is
first quarter shown).
3. Data for 1979 Q4 are most recent quarterly data available, and this quarter may not be a cyclical peak.
104
Federal Reserve Bulletin • February 1980
2. Velocities of new and old M-1
Percent
P Peak.
T Trough.
Data are seasonally adjusted at annual rates.
these aggregates has been quite similar, movements in their velocities have been very close,
although the velocity of M-lB has risen less rapidly in recent years than have the velocities of M1A and old M-l, reflecting shifts to NOW and
ATS accounts of funds held in demand deposit
accounts and in relatively inactive savings accounts. Average rates of increase in these velocities over longer intervals and over cycles are presented in table 4. During economic expansions
the velocities of all three measures have tended
to rise at annual rates in excess of 3 percentage
points, while in economic contractions all three
velocities have tended to decline or at least their
growth slackens. Further, in more recent cycles
all three velocities have expanded at successively more rapid rates.
Growth in the new M-2 measure is shown in
chart 3, along with growth in the old M-2 and M-3
aggregates. 29 The chart also displays the differential between the yield on Treasury bills and
the ceiling rate on passbook savings accounts at
commercial banks, which can be viewed as an
indicator of the attractiveness of money market
instruments relative to the interest-earning deposit components of these aggregates. Chart 3 illustrates that growth in new M-2 has tended to
vary closely with that of old M-3 and, to a lesser
extent, that of old M-2. In addition, growth in
new M-2, along with growth of the two other
29. Appendix table 2 contains annual and recent quarterly
growth rates for these measures.
The Redefined Monetary Aggregates
105
4. Trend and cyclical behavior of velocities of new and old measures of money
Average annual rates of growth in percent
New
M-l A
New
M-1B
Old
M-l
New
M-2
Old
M-2
Old
M-3
New
M-3
Old
M-4
Old
M-5
3.2
2.9
3.6
3.0
2.9
3.1
3.2
2.9
3.5
-.1
-.2
0
.5
.4
.6
-.3
-.3
-.3
-.8
-.6
-1.1
.1
.1
0
-.6
-.5
-.7
Peak to trough1
1960 Q2-1961 Q1
1969 Q4-1970 Q4
1973 Q4-1975 Q1
-1.7
-.3
1.5
-1.7
-.3
1.4
-1.7
-.3
1.3
-6.3
-1.2
-.5
-5.3
-2.6
-1.5
-6.8
-2.5
-1.4
-6.7
-4.1
-2.4
-5.5
-5.2
-3.9
-6.9
-4.3
-3.0
Trough to peak2
1961 Ql-1969 Q4
1970 Q4-1973 Q4
1975 Ql-1979 Q43
3.1
3.6
4.9
3.1
3.5
4.1
3.1
3.5
4.9
.1
-.4
.6
.6
.3
2.1
0
-1.0
.9
-.2
-2.4
.6
.3
-1.4
3.0
-.2
-2.0
1.5
Period
1960-79
1960-69
1970-79
1. Averages of annualized quarter-to-quarter rates of growth. The base quarter for each calculation is the quarter following the peak (peak is
first quarter shown).
2. Averages of annualized quarter-to-quarter rates of growth. The base quarter for each calculation is the quarter following the trough (trough is
first quarter shown).
3. Data for 1979 Q4 are most recent quarterly data available, and this quarter may not be a cyclical peak.
measures shown, has been sensitive to the yield
spread, tending to slow as market rates have advanced above deposit ceiling rates. The new M-2
should, however, become less interest-sensitive
if the proportion of this aggregate comprising
components with yields tied to the money market
continues to expand. As shown in chart 4, the
share of new M-2 in money market certificates
has risen sharply since these accounts were introduced in mid-1978, and the shares in money
market mutual funds, overnight RPs, and overnight Eurodollars have also increased in recent
years. By contrast, the shares of M-l A and ordinary savings accounts have generally declined.
Trend and cyclical growth rates of new M-2
and old M-2 and M-3 are shown in table 3. Over
longer periods, especially during economic expansions, new M-2 has grown faster than old
M-2. Compared with old M-3, new M-2 has
expanded more slowly, except during the most
recent economic expansion when sharp increases in money market mutual fund shares and expansion in overnight RPs and overnight Eurodollars contributed to somewhat more rapid
growth in new M-2. 30
The velocity of new M-2, along with the velocities of old M-2 and M-3, is shown in chart 5.
New M-2 velocity has shown very little trend
over the past two decades, although it has dis30. During economic contractions, new M-2 has tended to
weaken relative to old M-2 and M-3, mainly because growth
in those two aggregates was buoyed by their large-denomination time deposit components.
played a tendency to vary directly with the
spread between market rates of interest and regulatory ceilings. By contrast, the velocity of old
M-2 tended to increase, especially in recent
years, while the velocity of old M-3 has shown a
very slight tendency to decline over the 1960s
and 1970s.31
The rate of growth of new M-3 is shown in
chart 6, along with rates of growth of the old M-4
and M-5 measures. Also shown in chart 6 is the
rate of growth of L, the broad measure of liquid
assets. 32 Chart 6 illustrates the closely parallel
rates of growth in new M-3 and old M-5, which
are similar in content, although expansion in new
M-3 has generally exceeded that of both of its old
counterparts. The disparity between growth in
new M-3 and in old M-4 and M-5 widened in the
late 1970s with sizable increases in RPs, money
market mutual fund shares, and overnight Eurodollars; these items are components of the new
M-3 aggregate but not of the old M-4 and M-5
aggregates.
Growth in total liquid assets, L, has been similar to—although somewhat steadier than—that of
new M-3. In recent years, L has tended to grow
more rapidly than M-3 and other broad monetary
aggregates, reflecting a growing proportion of liq31. Trend and cyclical rates of growth of the velocities of
these three measures are shown in the middle three columns
of table 4.
32. Annual and quarterly rates of growth of the new M-3
and L measures and the old M-4 and M-5 measures are presented in appendix table 3, along with rates of growth of their
velocities.
106
Federal Reserve Bulletin • February 1980
16
8
0
8
+
0
6
+
is
uid assets that is being issued outside domestic
depositary institutions.
Chart 7 depicts the velocity of the new M-3,
together with the velocities of L and of old M-4
and M-5. While the velocity of new M-3 has generally declined over the period shown, in recent
years it has displayed some tendency to level off.
The responsiveness of new M-3, and the old M-4
and M-5 measures, to changes in the interest rate
spread was dampened by the removal of regulatory ceilings on some large-denomination time
deposits in 1970 and on removal of those on the
remainder in 1973. The velocity of L has also declined over the period.
SOME TECHNICAL
ISSUES
The new aggregates incorporate consolidation
and seasonal adjustments. In addition, their construction relies on new data sources.
The Redefined Monetary Aggregates
107
4. Principal components of new M-2
Percent
Other checkable deposits
Savings deposits
Small-denomination time deposits less MMCs
MMCs
Money market mutual fund shares^
Overnight RPs and Eurodollars
j
M-l A, savings deposits, and small-denomination time deposits are seasonally adjusted,
Consolidation
Consolidation adjustments have been made in
the construction of each of the new measures, in
order to avoid double counting of the public's
monetary assets. 33 One major consolidation ad33. A discussion of consolidation issues can be found in
Improving
the Monetary
Aggregates:
Report,
37, and in "A Proposal," pp. 32, 40-41.
pp. 12-14, 31-
justment involves the netting of deposits held by
depositary institutions with other depositary institutions. In constructing M-1A, demand deposits held by commercial banks with other commercial banks have been removed. The
procedure also calls for the removal from M-1B
of those demand deposit holdings of thrift institutions that are estimated to be used in servicing
their checkable deposits; at present the amount
is negligible. Similarly, at the M-2 level all other
108
Federal Reserve Bulletin • February 1980
5. Velocities of new M-2 and old M-2 and M-3
P Peak.
T Trough.
Data are seasonally adjusted at annual rates. Yield spread is Treasury
bill rate less passbook ceiling rate.
demand deposit holdings of thrift institutions are
deducted; currently that means all such demand
deposits are netted from M-2. 34 Savings and time
deposits held by depositary institutions are also
appropriately netted at the M-2 and M-3 levels.
The other major consolidation adjustment involves removing the assets held by money market mutual funds from several components of the
M-2, M-3, and L measures. 35 These institutions
issue shares to the public and use the proceeds to
acquire a variety of liquid assets that are components of the new M-2, M-3, and L measures.
To avoid counting these amounts first as money
market mutual fund shares and then again as
money market fund holdings of RPs, CDs, commercial paper, and so forth, holdings of each of
these assets by money market funds are subtracted from the relevant components. Thus
holdings by money market funds of RPs are deducted in constructing the public's overnight RPs
for M-2, holdings of domestic CDs are deducted
from the large-denomination time deposits for
M-3, and holdings of each of the other assets appearing in L are appropriately netted.
Each of the principal components of the new
aggregates will be published in the money stock
release on a consolidated, not a gross, basis, as it
appears in the new aggregates. Thus differences
between the published M-1B and M-2 aggregates
34. It has been assumed that all demand deposits owned by
thrift institutions are held to service their checkable deposits
and their ordinary savings deposits. The portion of thrift institution holdings of demand deposits to be removed at the
M-1B level is determined by the ratio of checkable deposits
at thrift institutions to the sum of their checkable and savings
deposit liabilities.
35. In general, the components against which a money
market mutual fund adjustment is made exclude holdings by
depositary institutions, the U.S. government (including the
Federal Reserve), and foreign commercial banks and official
institutions.
The Redefined Monetary Aggregates
6. Rates of growth of new M-3 and L and old M-4 and M-5
P Peak.
T Trough.
Data are seasonally adjusted at annual rates. Yield spread is Treasury bill rate less passbook ceiling rate.
109
110
Federal Reserve Bulletin • February 1980
7. Velocities of new M-3 and L and old M-4 and M-5
P Peak.
T Trough.
Data are seasonally adjusted at annual rates. Yield spread is Treasury
bill rate less passbook ceiling rate.
and the sum of their published components will
equal the consolidation components associated
with thrift institution demand deposits.
ponents that have not yet been seasonally adjusted (and the aggregate in which they first
appear) are as follows:
1. Other checkable deposits (M-1B).
2. Overnight RPs and Eurodollars (M-2).
3. Money market mutual fund shares (M-2).
4. Term RPs at both commercial banks and
savings and loan associations (M-3).
5. Other Eurodollars held by U.S. residents
(L).
A standard option of the Census X-ll program
was used in the seasonal adjustment of the separate components of the new aggregates, following an examination of several alternative options.
However, it should be noted that the overall issue of seasonal adjustment of the monetary aggregates has been under review by a panel of outside experts, the Committee of Experts on
Seasonal Adjustment Techniques, under the
Seasonal
Adjustment
The procedure for seasonal adjustment of the
new aggregates involves seasonal adjustment of
each component, whenever possible, and then a
summation of the components to derive the
appropriate total. Some components cannot be
seasonally adjusted until sufficient historical data
are available.36 The most important of the com-
36. In some cases, even though enough historical data are
available for a seasonal adjustment, the series are dominated
by a strong trend, so that it is unlikely that actual seasonal
patterns can be measured accurately.
The Redefined Monetary Aggregates
111
5. New data sources for constructing the redefined monetary aggregates
Component
and aggregate in
which it first appears
Coverage
Frequency
Lag
(weeks)
Demand deposits (M-1A)
Nonmember banks1
sample
weekly (daily average)
2-3
Other checkable deposits (M-1B)
Member banks (ATS and NOW)
Nonmember banks (ATS and NOW)
Mutual savings banks (NOW and demand deposits)
Savings and loans (NOW)
Credit unions (share drafts)2
universe
sample
sample
sample
sample
weekly (daily average)
weekly (daily average)
weekly (Wednesday)
thrice-monthly
weekly (Wednesday)
2-3
2-3
1
2-3
Savings and small-denomination time deposits (M-2)
Nonmember banks
Mutual savings banks
Savings and loans
Credit unions2
sample
sample
sample
sample
weekly (daily average)
weekly (Wednesday)
thrice-monthly
weekly (Wednesday)
2-3
2-3
1
2-3
Overnight repurchase agreements (M-2)
Member banks
125 large member banks
weekly (daily average)
1
Overnight Eurodollars at Caribbean branches (M-2)
Member banks
approximate universe
weekly (daily average)
1
Money market mutual fund shares (M-2)
universe
weekly (Wednesday)
1
Large-denomination time deposits (M-3)
Nonmember banks
Mutual savings banks
Savings and loans
sample
sample
sample
weekly (daily average)
weekly (Wednesday)
thrice-monthly
2-3
2-3
1
Term repurchase agreements (M-3)
Member banks
125 large member banks
weekly (daily average)
1
1. In addition, data on demand deposits of U.S. branches and agencies of foreign banks would be collected on a regulatory report of deposits
with an application of reserve requirements of these institutions under the International Banking Act. At present, all U.S. branches and agencies of
foreign banks report their deposits once each month and large institutions in New York City report deposits on a daily basis.
2. Scheduled to begin in March 1980. Weekly sample consists of approximately 70 of the largest credit unions. In addition, a sample of smaller
credit unions will be collected once each month, as of the last Wednesday of the month.
chairmanship of Geoffrey H. Moore, which is
scheduled to report to the Board in a few
months. 37
New Data
Sources
Several new data sources are being used in connection with the redefined aggregates. Most of
these new sources are associated with components that either are new or appear separately
for the first time, and they have been obtained in
order to improve the accuracy and the timeliness
of the redefined measures. The staff believes that
their use will make the quality of monetary statistics for the new measures at least comparable to
that of the old measures.
A number of new data series began around
year-end 1979 and some others are scheduled to
37. Other members of this committee are George Box, Hyman Kaitz, James Stephenson, and Arnold Zellner.
begin in early 1980.38 The most important new
series are shown in table 5. Most of these series
are collected on a sample basis and are then
benchmarked to less frequent reports of condition in order to obtain timely estimates of the total volume of each item. A sample of nonmember
banks serves to estimate demand deposits, other
checkable deposits, and small- and large-denomination time deposits on a weekly basis. Similarly, a sample of mutual savings banks, which began to be surveyed in early 1980, is being used to
construct the components of deposits at these institutions. In 1979 the Federal Home Loan Bank
Board started collecting sample data three times
a month from savings and loan associations on
the various components of the new aggregates. A
new sample of credit unions is scheduled for implementation in the spring of 1980 and should
provide timely data on several components for
these institutions. Data on money market mutual
38. Other data sources are discussed in "A Proposal," pp.
33-40.
112
Federal Reserve Bulletin • February 1980
fund shares are being collected in a new weekly
survey by the Investment Company Institute. In
addition, this institute collects monthly data on
the industry's holdings of various assets, for use
in the consolidation process. Data on overnight
Eurodollars at offices in the Caribbean are now
A1.
being collected on a daily basis from all member
banks with significant amounts of these deposits.
Finally, a new daily report on selected federal
funds and RP borrowings of 125 large member
banks is used in constructing the overnight and
term RP series.
Rates of monetary and velocity growth for new and old M-1
Percent
Monetary growth
Velocity growth
New M-1A
New M-1B
Old M-l
NewM-lA
New M-1B
Old M-l
Year
1960
1961
1962
1963
1964
.6
2.8
1.8
4.0
4.3
.6
2.8
1.8
4.0
4.4
.4
2.8
1.4
4.0
4.5
1.7
4.3
4.0
2.6
1.4
1.7
4.3
4.0
2.6
1.4
1.8
4.2
4.4
2.6
1.3
1965
1966
1967
1968
1969
4.4
2.7
6.4
7.4
3.8
4.4
2.7
6.3
7.4
3.8
4.3
2.9
6.4
7.6
3.9
5.8
5.3
-.3
1.8
2.6
5.8
5.3
-.2
1.7
2.6
5.8
5.1
-.3
1.6
2.5
1970
1971
1972
1973
1974
4.8
6.6
8.5
5.7
4.7
4.8
6.6
8.5
5.8
4.7
4.8
6.6
8.4
6.2
5.1
-.3
2.7
3.0
5.2
2.4
-.3
2.7
3.0
5.1
2.4
-.3
2.8
3.1
4.6
2.0
1975
1976
1977
1978
1979
4.7
5.5
7.7
7.4
5.5
4.9
6.0
8.1
8.2
8.0
4.6
5.8
7.9
7.2
5.5
5.1
4.2
4.2
5.6
4.2
4.9
3.7
3.9
4.8
1.8
5.2
3.9
4.0
5.8
4.2
Quarter2
1973-1
2
3
4
8.2
4.9
4.4
4.8
8.4
4.9
4.5
4.8
8.5
5.1
5.2
5.4
6.7
2.4
4.6
6.5
6.5
2.4
4.5
6.6
6.4
2.2
3.8
5.9
1974-1
2
3
4
6.7
3.6
3.1
4.9
6.7
3.6
3.1
5.0
7.3
4.1
4.1
4.6
-2.6
5.4
5.4
1.4
-2.6
5.4
5.4
1.2
-3.1
4.9
4.5
1.6
1975-1
2
3
4
2.6
5.9
7.0
2.9
2.9
5.9
7.3
3.2
2.0
5.8
7.2
3.0
-2.0
6.0
10.3
5.7
-2.3
6.1
10.0
5.4
-1.3
6.2
10.0
5.6
1976-1
2
3
4
5.4
5.8
3.4
7.0
5.7
6.3
3.9
7.6
4.6
6.4
4.1
7.4
8.4
1.3
4.3
2.4
8.1
.8
3.8
1.8
9.2
.7
3.6
1.9
1977-1
2
3
4
8.8
6.7
6.0
8.4
9.3
6.9
6.5
8.7
7.4
7.4
8.6
7.4
5.6
5.5
5.6
.1
5.2
5.3
5.0
-.2
7.0
4.8
2.9
1.1
1978-1
2
3
4
7.6
8.7
7.1
5.6
7.9
9.1
7.3
7.4
6.6
9.2
7.9
4.3
.5
9.6
3.4
8.3
.2
9.1
3.2
6.5
1.4
9.0
2.6
9.6
1979-1
2
3
4
.2
7.8
8.8
4.7
4.8
10.7
10.1
5.3
-1.3
8.1
9.7
5.0
9.9
-1.2
2.6
5.1
5.3
-4.0
1.3
4.6
11.6
-1.5
1.7
4.8
1
1. Fourth-quarter over fourth-quarter growth rates.
2. Annualized growth rates based on seasonally adjusted data.
The Redefined Monetary Aggregates
113
A2. Rates of monetary and velocity growth for new M-2 and old M-2 and M-3
Percent
Velocity growth
Monetary growth
Period
New-M-2
Old M-2
Old M-3
New M-2
Old M-2
Old M-3
Year1
1960
1961
1962
1963
1964
4.6
7.1
8.0
8.6
7.9
2.6
5.4
5.9
7.0
6.7
4.8
7.1
7.7
8.7
8.3
-2.3
0
-2.0
-1.8
-2.0
-.3
1.7
0
-.3
-.8
-2.4
0
-1.7
-1.9
-2.2
1965
1966
1967
1968
1969
8.0
4.9
9.3
8.0
4.2
8.6
6.0
9.9
9.0
3.2
8.6
5.4
9.7
8.1
3.6
2.2
3.1
-2.9
1.2
2.3
1.7
2.0
-3.4
.3
3.2
1.7
2.7
-3.3
1.1
2.8
1970
1971
1972
1973
1974
5.8
13.5
12.9
7.3
6.0
7.2
11.3
11.2
8.8
7.7
7.2
13.5
13.3
9.0
7.1
-1.2
-3.5
-1.0
3.5
1.1
-2.6
-1.6
.5
2.1
-.5
-2.5
-3.5
-1.3
1.9
.1
1975
1976
1977
1978
1979
12.3
13.7
11.5
8.4
8.8
8.4
10.9
9.8
8.7
8.3
11.1
12.7
11.7
9.5
8.1
-2.0
-3.3
.7
4.6
1.0
1.5
-.9
2.2
4.3
1.4
-1.0
-2.5
.5
3.6
1.6
Quarter2
1973-1
2
3
4
10.3
6.9
6.0
5.4
9.8
7.7
7.7
9.0
10.9
8.3
7.4
8.2
4.7
.4
3.0
6.0
5.2
-.4
1.3
2.4
4.1
-1.0
1.6
3.1
1974-1
2
3
4
8.0
5.2
4.4
5.8
10.3
7.0
6.1
6.6
9.6
6.4
5.2
6.4
-3.9
3.8
4.2
.5
-6.1
2.1
2.4
-.4
-5.3
2.6
3.3
-.2
1975-1
2
3
4
7.8
14.9
14.6
9.9
6.4
9.5
10.0
6.8
8.2
12.4
12.8
9.4
-7.1
-2.7
2.8
-1.1
-5.7
2.5
7.2
1.9
-7.5
-.3
4.5
-.7
1976-1
2
3
4
13.0
12.7
11.3
15.2
10.5
10.0
8.9
12.6
12.0
11.9
11.0
13.8
.9
-5.4
-3.4
-5.6
3.3
-2.8
-1.1
-3.1
1.9
-4.7
-3.1
-4.3
1977—1
2
3
4
13.7
11.2
9.6
9.7
10.9
9.0
10.1
7.9
12.4
10.5
11.8
10.1
.9
1.0
1.9
-1.2
3.6
3.2
1.5
.5
2.1
1.7
-.2
-1.6
1978-1
2
3
4
7.5
7.5
8.2
9.5
7.0
8.4
9.8
8.5
8.1
8.4
10.3
9.8
.6
10.8
2.3
4.4
1.1
9.9
.8
5.4
0
9.8
.3
4.1
1979-1
2
3
4
6.3
10.2
10.3
7.2
2.8
8.8
11.9
8.9
5.3
7.9
10.5
7.8
3.9
-3.5
1.1
2.7
7.3
-2.1
-.5
1.0
4.8
-1.3
.9
2.1
1. Fourth-quarter over fourth-quarter growth rate.
2. Annualized growth rates based on seasonally adjusted data.
114
Federal Reserve Bulletin • February 1980
A3. Rates of monetary and velocity growth for new M-3 and L and old M-4 and M-5
Percent
Monetary growth
Period
Velocity growth
New M-3
New L
Old M-4
Old M-5
New M-3
New L
Old M-4
Old M-5
Year1
1960
1961
1962
1963
1964
4.8
7.7
8.8
9.5
8.9
3.5
6.2
8.0
8.4
7.3
2.6
6.5
7.1
8.3
7.8
4.8
7.9
8.5
9.6
9.0
-2.5
-.5
-2.7
-2.6
-2.8
-1.2
.9
-2.0
-1.6
-1.4
-.3
.6
-1.2
-1.6
-1.8
-2.4
-.7
-2.4
-2.7
-2.9
1965
1966
1967
1968
1969
9.2
5.2
10.4
8.7
1.5
8.1
5.5
8.5
9.5
4.4
9.5
5.5
10.7
9.3
.1
9.1
5.0
10.3
8.3
1.5
1.1
2.8
-3.9
.6
5.0
2.2
2.5
-2.2
-.2
2.0
.9
2.6
-4.2
.0
6.4
1.2
3.0
-3.8
.9
4.9
1970
1971
1972
1973
1974
8.9
14.8
14.0
11.7
8.7
6.5
10.4
12.9
12.3
9.6
10.2
12.8
12.3
12.0
10.7
9.2
14.3
13.9
11.0
9.0
-4.1
-4.6
-2.0
-.5
-1.4
-1.9
-.8
-1.0
-1.1
-2.2
-5.1
-2.9
-.5
-.8
-3.1
-4.3
-4.2
-1.9
.1
-1.7
1975
1976
1977
1978
1979
9.4
11.4
12.6
11.3
9.5
9.8
11.0
12.6
12.3
n.a.
6.6
7.1
10.1
10.6
7.5
9.7
10.2
11.7
10.6
7.6
.6
-1.3
-.3
1.9
.3
.2
-1.0
-.3
1.0
n.a.
3.3
2.6
2.0
2.5
2.2
.3
-.3
.5
2.5
2.1
Quarter2
1973-1
2
3
4
14.0
11.7
11.2
8.0
14.0
12.3
11.8
9.1
14.2
13.8
11.0
7.0
13.7
12.2
9.6
7.1
1.0
-4.3
-2.2
3.3
1.1
-4.8
-2.7
2.2
.9
-6.3
-1.9
4.4
1.3
-4.7
-.6
4.3
1974-1
2
3
4
10.1
10.6
7.7
5.4
11.0
11.1
8.4
6.6
11.4
12.8
9.9
6.9
10.2
10.3
7.8
6.7
-5.9
-1.5
.9
.8
-6.7
-1.9
.1
-.3
-7.1
-3.6
-1.3
-.7
-6.0
-1.2
.8
-.4
1975-1
2
3
4
7.2
9.4
10.7
9.1
7.1
9.5
10.5
10.7
7.6
5.5
6.2
6.2
8.9
9.5
10.1
8.8
-6.4
2.6
6.5
-.4
-6.4
2.5
6.8
-1.9
-6.9
6.5
11.1
2.4
-8.1
2.5
7.1
-.1
1976-1
2
3
4
9.9
11.3
10.3
12.1
10.1
11.1
10.0
10.8
6.0
6.0
6.3
9.5
9.0
9.4
9.2
11.8
4.0
-4.1
-2.5
-2.6
3.7
-3.9
-2.2
-1.4
7.8
1.0
1.5
-.1
4.8
-2.2
-1.4
-2.3
1977-1
2
3
4
12.4
11.4
11.7
12.5
11.5
11.8
12.2
12.8
10.1
8.3
10.0
10.4
11.8
10.0
11.7
11.5
2.2
.8
-.1
-3.9
3.0
.4
-.6
-4.2
4.4
3.9
1.6
-1.9
2.7
2.2
-.1
-2.9
1978-1
2
3
4
10.5
11.1
10.3
11.5
11.2
12.4
11.3
12.2
10.2
10.6
9.9
10.1
10.0
9.8
10.4
10.7
-2.3
7.2
.2
2.4
-.3
5.9
-.7
1.8
-2.1
7.6
.6
3.8
-1.8
8.4
.2
3.3
1979-1
2
3
4
7.9
8.8
10.3
9.8
10.4
13.1
11.7
n.a.
5.4
3.7
9.2
6.8
4.9
8.9
9.1
2.3
-2.2
1.1
-.2
- 6.3
-.3
n.a.
4.7
2.9
2.2
-1.0
3.4
1.7
2.5
.8
11.0
1. Fourth-quarter over fourth-quarter growth rates.
2. Annualized growth rates based on seasonally adjusted data,
n.a. Not available as data for December 1979 are incomplete.
.1
115
Domestic Financial Developments
in the Fourth Quarter of 1979
This report, which was sent to the Joint Economic
Committee of the U.S. Congress on February 6,
1980, highlights the important developments in
domestic financial markets during the fall and
early winter.
As the fourth quarter opened, the monetary aggregates were expanding rapidly in an environment of double-digit inflation, a depreciating dollar in foreign exchange markets, and increasing
speculative activity in metals and other basic
commodities markets. On October 6, the Federal
Reserve announced a policy package designed to
address this situation by slowing the growth of
money and bank credit with the intent of achiev-
ing rates of increase announced earlier for the
year as whole. The discount rate was increased a
full percentage point, to 12 percent. In addition,
a marginal reserve requirement of 8 percent was
made applicable to any increase over base-period
levels in managed liabilities issued by large member banks and by branches and agencies of certain foreign banks. Such managed liabilities include time deposits issued in denominations of
$100,000 or more maturing within one year, as
well as net borrowings from own foreign
branches and certain other Eurodollar transactions; also included are federal funds purchased
and securities sold under repurchase agreements, net of a trading-account exemption,
Interest rates
Percent per annum
State and local
government bonds
1977
1978
1979
1980
Monthly averages except for Federal Reserve discount rate and
conventional mortgages (based on quotations for one day each
month). Yields: U.S. Treasury bills, market yields on three-month issues; prime commercial paper, dealer offering rates; conventional
mortages, rates on first mortgages in primary markets, unweighted
and rounded to nearest 5 basis points, from U.S. Department of Hous-
1977
1978
1979
f
1980
ing and Urban Development; Aaa utility bonds, weighted averages of
new publicly offered bonds rated Aaa, Aa, and A by Moody's Investors Service and adjusted to Aaa basis; U.S. government bonds,
market yields adjusted to 20-year constant maturity by U.S. Treasury;
state and local government bonds (20 issues, mixed quality), Bond
Buyer.
116
Federal Reserve Bulletin • February 1980
Changes in selected monetary aggregates1
Seasonally adjusted annual rates of change, in percent
1979
1978
Item
1977
1978
1979
Q4
Q1
Q2
Q3
Q4
2
Member bank reserves
Total
Nonborrowed
Monetary base3
Concepts of money4
M-l
M-2
M-3
Time and savings deposits in M-2 ..
Small time plus total savings5 ....
Savings
Small time
Time and savings in M-2
excluding MMCs
Thrift deposits in M-3
Excluding MMCs
MEMO (change in billions of dollars,
seasonally adjusted)
Managed liabilities
Large negotiable CDs at large
banks
All other large time deposits ..
Nondeposit funds
Net due to related foreign
institutions
Other6
5.3
3.1
8.3
6.7
6.8
9.1
2.8
.8
7.6
2.4
4.7
8.5
-3.0
-3.4
5.6
-5.0
-8.8
3.9
6.3
8.2
9.8
13.1
7.5
10.1
7.9
9.8
11.7
7.2
8.7
9.5
5.5
8.3
8.1
4.3
8.5
9.8
-1.3
2.8
5.3
8.1
8.8
8.0
9.7
11.9
10.5
5.1
8.9
7.8
11.2
10.5
11.1
9.7
9.7
6.1
1.8
11.9
10.4
10.8
-5.8
31.0
11.5
7.6
-1.2
19.2
5.8
2.7
-11.8
20.3
9.3
15.0
-3.5
35.9
13.3
15.7
5.8
25.7
11.5
8.3
— 13.8
30.0
-5.2
2.5
-8.2
-5.0
1.7
-9.6
14.5
10.6
7.8
-10.1
11.6
-5.7
8.8
-3.8
6.8
-21.3
8.4
-1.0
6.3
-15.5
27.5
68.3
49.6
19.7
20.8
4.0
12.8
12.8
8.0
10.8
8.7
23.1
22.1
23.1
0.0
9.2
40.7
5.5
6.7
7.5
7.0
4.7
9.1
-10.3
17.6
-4.0
1.1
15.7
7.3
6.7
-1.2
-3.8
12.4
6.6
16.5
26.0
14.7
3.9
3.7
4.3
4.8
11.9
5.7
9.1
6.6
.7
-1.9
-3.3
1. Changes are calculated from the average amounts outstanding in each quarter.
2. Annual rates of change in reserve measures have been adjusted for changes in reserve requirements.
3. Includes total reserves (member bank reserve balances in the current week plus vault cash held two weeks earlier), currency in circulation
(currency outside the U.S. Treasury, Federal Reserve Banks, and the vaults of commercial banks), and vault cash of nonmember banks.
4. M-l is currency plus private demand deposits adjusted. M-2 is M-l plus bank time and savings deposits other than negotiable CDs in
denominations of $100,000 or more. M-3 is M-2 plus deposits at mutual savings banks and savings and loan associations plus shares in credit
unions.
5. Interest-bearing deposits subject to Regulation Q.
6. Includes borrowings from other than commercial banks through federal funds purchased and securities sold under repurchase agreements,
plus loans sold to affiliates, loan RPs, and other borrowings.
from sources other than member banks, U.S.
branches and agencies of foreign banks, and
Edge Act corporations.
The policy package also included a change in
the System's daily operating procedures to emphasize control of the volume of member bank
reserves as the means of achieving desired monetary growth rates. Previously, open market operations had focused attention primarily on maintaining the federal funds rate at a level thought
consistent with monetary growth objectives.
This procedure had become less satisfactory as
institutional innovations and changing inflationary expectations made it more difficult to ascertain the short-run relationship between interest
rates and the monetary aggregates.
Interest rates increased sharply during the
three weeks following the October 6 action, and
short-term rates exhibited unusual day-to-day
volatility. The federal funds rate, which had av
eraged just under 12 percent the week preceding
the announcement, peaked above 15V2 percent
two weeks later; other short-term rates also rose
abruptly though by less. At banks, the prime
lending rate reached 153/4 percent in mid-November compared with 13V2 percent on October
6. Medium- and long-term rates rose between 1
and IV2 percentage points, and stock prices
dropped markedly—by 10 percent or so on average. By the middle of November, however, upward pressures on interest rates dissipated as
markets adjusted to the System's new operating
procedure and as growth in credit flows and in
the monetary aggregates slowed. By mid-December, interest rates were down from their mid-November peaks, the bank prime rate had been reduced to 15V4 percent, and stock price averages
had recovered to about September month-end
levels.
As a result of the new policy procedures, the
Domestic Financial Developments,
accompanying sharp increase in interest rates,
and further slowing in the expansion of real and
nominal G N P , g r o w t h in money and credit
slowed sharply in the fourth quarter. Narrowly
defined money, M-l, grew at an annual rate of 5
percent, on a quarterly average basis, little more
than half the pace of the preceding three months.
Inflows of time and savings deposits included in
the broader aggregates (M-2 and M-3) also weakened, and excluding 6-month money market certificates (MMCs), those deposits declined. M-l
and M-3 were within, and M-2 was only slightly
above, the growth ranges established by the Federal Open Market Committee (FOMC) for the
year ending with the fourth quarter of 1979.
Bank credit expansion also slowed sharply in
the quarter, with business loans increasing at
only a 6 percent annual rate, compared with more
than 20 percent during the spring and summer.
Indeed, credit flows to the private sector in general diminished in the fourth quarter. Substantially increased credit costs discouraged some
borrowing, and the supply of funds was constrained as usury ceilings became binding in
certain states and as lenders instituted new restrictions on nonprice terms. Households reduced their borrowing in the consumer installment credit and residential mortgage markets. In
the public sector, Treasury borrowing was relatively sizable, reflecting the large fourth-quarter
deficit, and state and local financing also remained quite high.
Q4 1979
117
bearing savings accounts subject to automatic
transfer service (ATS) or negotiable order of
withdrawal (NOW). Such transfers declined in
volume as the year progressed, however; in the
fourth quarter they had a negligible impact on
M-l growth.
The sharp changes in market yields in the
fourth quarter had a marked effect on the structure of the interest-bearing component of M-2.
Savings accounts contracted at a record annual
rate of 133A percent, as yields on MMCs and on
market instruments rose to almost twice the ceiling rates on savings accounts. Reflecting entirely
the robust gains in MMCs, particularly during
November, small-denomination time deposits at
commercial banks grew at a near-record annual
rate of 30 percent. Large-denomination time deposits included in M-2 also expanded at a substantial 25 percent annual rate over the quarter.
Overall, the time and savings deposit component
of M-2 increased at a rate only slightly below that
of the third quarter. Thus, the slowing in M-2
growth was less pronounced than that for M-l.
MMCs also were the primary source of funds
to thrift institutions during the fourth quarter. As
Treasury yield curves and deposit rate ceilings
Percent per annum
13
MONETAR Y A GGREGA TES
AND BANK CREDIT
The reduced pace of M-l growth in the fourth
quarter brought its growth rate for the year to
5V2 percent, within the 3 to 6 percent range established by the FOMC. 1 Growth over the course of
the year is estimated to have been reduced slightly less than IV2 percentage points by a diversion
of funds from demand deposits into interest-
1. The Committee had originally adopted a range of IV2 to
4V2 percent, on the assumption that shifting to newly authorized A T S and N O W accounts would depress growth of M - l
by 3 percentage points. When such shifting appeared likely to
be no more than half that amount, the range was adjusted to 3
to 6 percent.
T h i s point marks the maximum yield on money market time deposits at commercial banks and thrift institutions for December 31,
1979.
tThis point marks the maximum yield on 2 1/2-year floating ceiling
accounts authorized January 1, 1980 (thrift institutions, 11.12 percent; commercial banks, 10.84 percent).
Data reflect annual effective yields. Ceiling rates are yields derived
from continuous compounding of the nominal ceiling rates. Marketyield data are on an investment-yield basis.
118
Federal Reserve Bulletin • February 1980
at banks, depositors at thrift institutions withdrew funds from low-ceiling passbook accounts
and placed them in MMCs; such shifts during the
past year and a half have substantially altered the
institution's liability mix toward high-cost shortterm instruments. During the fourth quarter, savings and loan associations—particularly the bigger institutions—issued large-denomination time
deposits to supplement reduced deposit flows
from the household sector. In total, however,
growth in deposits at thrift institutions slowed
considerably toward year-end. Consequently,
the pace of expansion in M-3 abated to a VU percent rate in the fourth quarter—from a IOV2 percent rate in the preceding three months.
Households also acquired a substantial volume
of nondeposit assets as they sought to benefit
from higher market yields available during the
quarter. Money market mutual funds continued
to attract investors' funds; their assets increased
an average $3V2 billion per month. Direct acquisitions of short-term U.S. Treasury securities
also appealed to more savers than earlier in the
year, and noncompetitive tenders at Treasury
auctions swelled during November to a high for
the year.
Major categories of
bank loans
Components of
bank credit
Change, billions of dollars
4 I BUSINESS
TREASURY SECURITIES
—
16
+
m~ 0 I
;i2
n r
rh
n.nn n *
TOTAL LOANS
I
4
0
J 40 REAL ESTATE
32
24
1978
Q1
Q2
Q3
1979
a
Q4
8
4
10
n.nnnn
B
12
CONSUMER
n
Q4
8
J
OTHER SECURITI
m
NONBANK FINANCIAL
4
r-i., err*.. 1 I I I —t, Q
oI H
•
•
Q4
1978
Q1
Q2
Q3
Q4
1979
Seasonally adjusted. Total loans and business loans are adjusted
for transfers between banks and their holding companies, affiliates,
subsidiaries, or foreign branches.
At year-end, the federal regulatory agencies
further increased the opportunity for savers with
limited financial resources to earn near-market
rates of return on their deposits. Specifically, effective January 1, 1980, banks and thrift institutions are permitted to offer an account with a
minimum maturity of two and one-half years in
any size they choose and with an offering yield
tied to the market yield on 30-month U.S. Treasury securities; the return, once established, remains fixed throughout the life of the deposit.
The ceiling rate is 75 and 50 basis points below
the Treasury yield for banks and thrift institutions respectively; with continuous compounding, the effective ceiling yield at thrift institutions is nearly equal to the yield of the Treasury
security. In January, the effective yields on the
2V2-year certificates were 11.12 percent at thrift
institutions and 10.84 percent at commercial
banks. Regulators also authorized an increase of
X
U percentage point in the ceiling on 90-day to
1-year time accounts applicable to both banks
and thrift institutions.
Total member bank reserves grew at a 13 percent annual rate during the fourth quarter—exceeding growth of required reserves by 1 percentage point—as banks, as a group, evidenced a
desire for larger excess reserves in the aftermath
of the System's October 6 actions. Nonborrowed
reserves grew a great deal more slowly than total
reserves with member banks meeting a larger
proportion of their reserve needs at the discount
window.
The managed liabilities of commercial banks
increased $123/4 billion during the fourth quarter,
the same as during the third. For the first time in
six months, domestic offices issued substantial
amounts of large-denomination time deposits,
but this growth was partially offset by runoffs in
nondeposit funds. Large banks relied much less
on increased borrowing from their overseas offices; and other nondeposit borrowings, a composite that includes federal funds and repurchase
agreements (RPs), actually declined. With credit
demands apparently weakening and with the 8
percent marginal reserve requirement adding to
the already high costs for managed liabilities,
many banks sought to keep their balances below
base-period levels. By year-end, a number of
large member banks and most U.S. agencies and
branches of foreign banks had accomplished this
Domestic Financial Developments,
objective, despite growth in their loan portfolios.
In total, managed liabilities subject to the marginal reserve requirement averaged about $5!/2
billion in the second half of October but dropped
to about $374 billion in December.
With slackening economic expansion and with
firmer credit market conditions, total loans and
investments at commercial banks grew at a pace
of only VU percent during the fourth quarter,
down sharply from 153A percent in the previous
q u a r t e r . I n v e s t m e n t s grew only marginally.
Treasury securities were liquidated for the first
time since a year earlier, but the decline was
more than offset by acquisitions of other securities, primarily state and local obligations. Growth
in total loans outstanding at banks dropped from
an annual rate of I8V4 percent in the third quarter to 3V4 percent in the fourth, largely reflecting
a reduction in business loan growth and slower
growth in consumer loans.
BUSINESS
FINANCE
Total funds raised by businesses in financial markets decreased substantially in the fourth quarter. Among nonfinancial corporations, external
financing needs fell to their lowest level since
1977, as a further slowing in inventory accumulation reduced capital expenditures while internally generated funds continued to rise moderately. Reduced short- and intermediate-term
borrowing accounted for much of the resultant
decline in financing activity. In long-term markets, nonfinancial businesses continued to make
substantial use of commercial mortgages, but net
issuance of bonds and stocks remained well below the first-half pace.
Business loan growth at commercial banks fell
off quite sharply in the fourth quarter. In part,
this reduction was a reaction of firms to a sizable
increase in the cost of bank loans; the prime rate
increased 2 percentage points during the October-December period, reaching a high of 153/4
percent in late November. In addition, data
available for large banks indicate that nonprice
lending terms and standards of creditworthiness
tightened, with banks becoming more reluctant
to lend to new customers and more strict about
compensating balance requirements.
The outstanding commercial paper of non
Q4 1979
119
Business loans and shortand intermediate-term business credit
Seasonally adjusted annual rates of change, in percent1
Period
Business loans
at banks2
Short- and
intermediate-term
business credit3
1973
1974
1975
1976
1977
1978
1979
21.8
19.3
-3.8
1.3
10.5
16.3
17.4
21.5
23.5
-4.0
4.4
13.6
18.3
20.0
1979-Q1
Q2
Q3
Q4e
20.5
16.6
22.7
5.8
20.8
20.1
27.4
6.3
1. Growth rates calculated between last months of period.
2. Based on monthly averages of Wednesday data for domestically
chartered banks and an average of current and previous month-end
data for foreign-related institutions. Adjusted for outstanding amounts
of loans sold to affiliates.
3. Short- and intermediate-term business credit is business loans at
commercial banks plus nonfinancial commercial paper plus finance
company loans to businesses and bankers acceptances outstanding
outside banks. Commercial paper reflects prorated averages of Wednesday data. Finance company loans and bankers acceptances outstanding reflect averages of current and previous month-end data.
e Estimated.
financial firms fell, and growth in bankers acceptances slowed early in the fourth quarter. In December, however, business borrowing in these
markets strengthened again.
Gross offerings of bonds and stocks by both
nonfinancial and financial corporations fell to a
seasonally adjusted annual rate of $44 billion, the
lowest level recorded in 1979 and down from $58
billion in the third quarter. Public offerings of
bonds by nonfinancial corporations are estimated
to have declined somewhat in the fourth quarter,
largely because of a relatively low level of bond
issuance by industrial firms following the sharp
rise in rates after October 6. The volume of public offerings by utilities picked up in the quarter,
however, with most of that increase in October
and November. Financial businesses markedly
reduced their issuance of bonds during the quarter; this drop partly reflected a slowdown in offerings of mortgage-backed bonds by savings and
loan associations. Intermediate- and long-term
bond offerings by financial companies accounted
for about 40 percent of total public offerings in
the first half of 1979, but only about 20 percent of
the second-half total.
Takedowns of private bond placements in the
fourth quarter are estimated to have remained
120
Federal Reserve Bulletin • February 1980
near the pace of the third quarter, well below the
levels recorded in the first half of 1979. Life insurance companies (the principal lenders in the
private placement market) appear to be channeling a large volume of their funds into mortgages—especially commercial mortgages. In addition, investable funds of these institutions were
reduced by a sharp rise in loans on insurance policies after October 6.
Yields on corporate bonds increased appreciably during the fourth quarter. Bond yields
jumped 75 to 125 basis points between the Federal Reserve's October 6 policy announcement and
the month-end, and reached new highs in early
November; over the remainder of the quarter,
they changed little on b a l a n c e . The u p w a r d
movement in corporate bond yields and the uncertainty about economic and financial prospects
accompanying the System's policy actions gave
rise to an increased sensitivity by investors to
differences in risk. By the end of the fourth quarter, the spreads between rates on higher and
lower quality bonds had diminished considerably
from their mid-October levels but were still generally about twice as large as before October 6.
Stock prices declined sharply after October 6,
reflecting investor concern that higher interest
rates and reduced credit availability would detract significantly from economic activity and
corporate profits in the future. The fall in stock
values prompted several corporations to postpone or to cancel scheduled equity offerings,
which contributed to the reduction in total stock
offerings during the fourth quarter. The stock offerings that came to market during the quarter
Gross offerings of new security issues
Seasonally adjusted annual rates, in billions of dollars
1979
1978
Type of security
Q3r
Q4e
58
58
44
51
35
16
7
40
29
11
18
35
23
12
9
r
9
5
42r
43
50
Q4
Corporate
Bonds
Publicly offered
Privately placed
Stocks
Foreign
State and local
government
r Revised,
e Estimated.
Qi
Q2
42
47
30
18
12
12
39
17
22
8
5
3r
48
39
?
were concentrated in public utility issues. By
year-end, stock prices generally had retraced
their f o u r t h - q u a r t e r d e c l i n e s . The A m e r i c a n
Stock Exchange composite index was at a new
high at the end of the quarter; the National Association of Securities Dealers index posted sufficient gains late in the quarter to end the year
just below a record level set on October 5; and
the New York Stock Exchange composite index
ended the quarter near its high for the year.
GOVERNMENT
FINANCE
Gross bond offerings by state and local governments increased substantially in the fourth quarter, on a seasonally adjusted basis, despite the
postponement or cancellation of a large volume
of issues as interest rates rose in October. The
volume of offerings continued to be bolstered by
borrowing to finance housing, which, as in the
third quarter, was dominated by single-family
housing issues. These bonds were sold on the
basis of indications from the Congress that they
would be exempt from any new restrictions that
federal legislation, if passed, would impose on
home mortgage financing by state and local authorities.
Like yields in other markets, interest rates on
state and local obligations rose appreciably in the
fourth quarter. The Bond Buyer index of yields
on general obligations rose 60 basis points to end
the quarter at 7.2 percent. Yields on taxable issues increased much more, however, and the ratio of tax-exempt to corporate bond yields declined to a new low in the f o u r t h q u a r t e r .
Continued strong demands for tax-exempt bonds
by commercial banks and property-casualty insurance companies apparently tempered the rise
in municipal rates.
Treasury net cash borrowing from the public
increased in the fourth quarter to $18.9 billion,
not seasonally adjusted. The combined federal
deficit—including off-budget items—rose to
about $26 billion and was financed in part by
drawing down the Treasury's operating cash balance.
In contrast to the wide range of movements
over the preceding two quarters, there was little
net change during the fourth quarter in the outstanding volume of nonmarketable Treasury ob-
Domestic Financial Developments,
Q4 1979
121
Federal government borrowing and cash balance
Not seasonally adjusted, in billions of dollars
1979
1978
1977
Item
Treasury financing
Budget surplus, or deficit ( - )
Off-budget deficit1
New cash borrowings, or
repayments ( - )
Other means of financing3
Change in cash balance
Federally sponsored credit agencies,
net cash borrowings4
Q4
Q4
Ql
Q2
Q3
-20.4
-3.0
21.4
-5.2
-4.4
-4.2
-24.6
-.9
-4.6
-1.9
9.8
12.4
2.9
6.7
18.9
-1.7
-8.3
5.5
4.7
7.3e
Q4
Ql
Q2
Q3
-28.8
-1.3
-25.8
-3.7
14.0
-2.2
-8.1
-3.1
-23.8
— .1
20.7
2.6
-6.8
20.8
2.8
-5.9
2.5
-3.2
11.1
15.1
1.0
4.9
15.3
2.6
-6.1
10.62
4.2
-8.6
2.0
4.5
6.5
6.1
5.2
6.3
1. Includes outlays of the Pension Guaranty Corporation, Postal Service Fund, Rural Electrification and Telephone Revolving Fund, Rural
Telephone Bank, Housing for the Elderly or Handicapped Fund, and Federal Financing Bank. All data have been adjusted to reflect the return of
the Export-Import Bank to the unified budget.
2. Includes $2.6 billion of borrowing from the Federal Reserve on March 31, which was repaid April 4 following enactment of a new debt-ceiling
bill.
3. Checks issued less checks paid, accrued items, and other transactions.
4. Includes debt of the Federal Home Loan Mortgage Corporation, Federal Home Loan Banks, Federal Land Banks, Federal Intermediate
Credit Banks, Banks for Cooperatives, and Federal National Mortgage Association (including discount notes and securities guaranteed by the
Government National Mortgage Association).
e Estimated.
ligations. Most of the Treasury's borrowing was
accomplished through domestic sales of marketable securities to the public, both coupon issues
and bills. Given the need for large amounts of
new money at a time when a sizable volume of
coupon issues was maturing, the Treasury made
significant net additions to the weekly bill auctions for the first time since 1976. New funds
raised in this manner totaled about $3.5 billion
for the quarter. The Treasury also issued about
$7.5 billion of cash management bills dated to
mature in the spring, substantially more than the
volume of such bills issued in the fourth quarters
of other years.
N e t b o r r o w i n g by f e d e r a l l y s p o n s o r e d
agencies totaled a record $7.3 billion in the fourth
quarter, not seasonally adjusted. The increased
borrowing reflected efforts by the Federal Home
Loan Bank System and the Federal National
Mortgage Association (FNMA) to buttress residential mortgage credit flows and by the Farm
Credit System to meet demands for agricultural
credit usually provided by banks and life insurance companies.
Interest rates on Treasury securities increased
appreciably during the fourth quarter, along with
rates on private debt securities. Yields on shorter
dated bills rose slightly more than those on comparable private issues, however, largely because
of the sizable net issuance of bills in the fourth
quarter and the substantial sales of bills antici
pated in the first quarter of 1980. Interest rates on
long-term government bonds increased about 1
percentage point for the quarter, somewhat below the increases in yields on long-term corporate bonds, in line with the greater risk aversion
noted earlier.
MORTGAGE
AND CONSUMER
CREDIT
Mortgage credit conditions tightened markedly
after October 6. The average interest rate at savings and loan associations on new commitments
for conventional home mortgages with 80 percent loan-to-value ratios rose more than IV2 percentage points in the fourth quarter and in general nonprice lending terms firmed. Many savings
and loan associations drastically reduced or completely halted their commitment activity in October, and although there was some indication of a
liberalization of lending policies in late November and December, on the whole conditions remained much more stringent than in the previous
quarter.
The curtailment of credit availability was especially marked in states where usury ceilings prevented home mortgage rates from adjusting upward. During December, 16 states had fixed
ceilings below the national average for conventional mortgage rates, and in several other states
floating-rate ceilings tied to Treasury yields were
122
Federal Reserve Bulletin • February 1980
Net change in mortgage debt outstanding
Seasonally adjusted annual rates, in billions of dollars
1978
1979
Mortgage debt
Q4e
Q4
By type of debt
Total
Residential
Other1
By type of holder
Commercial banks ....
Savings and loans
Mutual savings banks
Life insurance
companies
FNMA and GNMA....
Other2
Q1
Q2
Q3
160
124
36
158
119
39
164
118
46
160
114
46
157
109
48
35
52
6
33
45
6
34
51
4
34
43
4
33
33
3
13
9
45
11
12
51
11
8
56
13
2
64
17
10
61
1. Includes commercial and other nonresidential as well as farm
properties.
2. Includes mortgage pools backing securities guaranteed by the
Government National Mortgage Association, Federal Home Loan
Mortgage Corporation, or Farmers Home Administration, some of
which may have been purchased by the institutions shown separately.
e Partially estimated.
below market mortgage yields. It was against this
backdrop that the Congress passed and the President signed into law on December 28 a bill that
temporarily exempts from state usury limits the
conventional first mortgages made by most types
of lenders for the purchase of residential property. Unless revoked by state action, the exemption will apply until March 31, 1980, and covers
new mortgage commitments made, as well as
loans closed, during the suspension period.
Net mortgage lending, which largely reflected
earlier commitment activity, moderated slightly
in the fourth quarter. The decline was concentrated in the residential sector and represented a
marked reduction in mortgage acquisitions by
savings and loan associations. Purchases of residential mortgages by FNMA increased sharply in
the fourth quarter, and issues of mortgage-backed securities guaranteed by the Government National Mortgage Association (GNMA) reached a
record level. An increase in net mortgage lending
by life insurance companies contributed to a rise
in commercial mortgage loans.
The relatively large decline in mortgage com-
mitment and lending activity at savings and loan
associations was largely a response to the uncertainty about future deposit flows in view of the
firming in credit markets. With a slowing in deposit growth in the fourth quarter and a jump in
the cost of borrowing from Federal Home Loan
Banks (FHLBs) and other sources, savings and
loans drew down holdings of liquid assets, causing the average liquidity ratio—cash and liquid
assets divided by the sum of short-term borrowings and deposits—to fall. To encourage savings
and loans to free more funds for mortgages, the
Federal Home Loan Bank Board reduced minimum liquidity ratios near the end of the quarter and proposed a liberalization of limits on
borrowing from sources other than FHLBs. Net
borrowing from FHLBs by savings and loan
associations declined somewhat in the fourth
quarter.
Growth in consumer installment credit outstanding slowed substantially during the fourth
quarter. The slackening was most pronounced
for auto credit, presumably related to the substantial drop in auto sales. The moderation also
may have reflected some retrenchment on the
part of households, whose debt burdens have
mounted over the course of the economic expansion. The amount of installment loans outstanding at credit unions contracted during the
October-December period, the first quarterly decline in more than seven years. Primary reasons
for the falloff in new loan extensions by credit
unions were the net redemption of shares in the
fourth quarter and the 12 percent ceiling imposed
on consumer loan finance rates at federally chartered and most state-chartered credit unions.
Rate ceilings were also a factor limiting consumer installment loans at some commercial
banks; in 16 states, for instance, the statutory
ceilings on new auto loans extended by commercial banks were 13 percent or lower (annual
percentage rate), which was about the same as
the marginal cost of lendable funds for banks
during the fourth quarter.
•
123
Production of Motor Vehicles in 1979
This article was prepared by Drucilla R. Hopper,
Joan D. Hosley, and Dixon A. Tranum of the
Board's Division of Research and Statistics.
Production of motor vehicles and parts was cut
back substantially during 1979, and by December
was one-fourth below its level a year earlier. This
reduction was related to a contraction in demand
for large and less fuel-efficient models because of
several factors: reduced availability of gasoline
in the spring, concerns about future fuel shortages, extraordinary price increases in petroleum
products, and the overall slowing of economic
activity. Stocks of most new domestic cars and
light-duty trucks reached excessive levels in the
spring, and inventories remained high for many
models throughout the year. Reflecting this situation, auto production was curtailed by temporary
plant shutdowns and, later, by termination of
second shifts at some plants. By year-end, more
than 140,000 auto workers were on indefinite layoff status; some permanent closings of plants
were also planned for early 1980.
The decline in motor vehicle production was a
major factor retarding the growth of industrial
output in 1979. At year-end, total industrial production was only fractionally above its December 1978 level (chart 1), but excluding motor vehicles and parts, output was about 2 percent
higher than a year earlier. Last year's decline in
auto output was about half as great as that from
the first quarter of 1973 to the first quarter of
1975.
The energy problems encountered throughout
1979 led to marked shifts in the demand for motor vehicles toward smaller, more fuel-efficient
cars—including subcompacts, some compacts,
diesels, and imported vehicles. With sales of
small cars increasing as a proportion of the total,
U.S. producers generally did not fare well because their output was still weighted heavily
toward the larger units for which demand was
lower (table 1).
The shift in demand in 1979 was more pro
1. Motor vehicle production and total industrial output
1967=100
nounced than had been expected and could not
be fully met by expansion in domestic production
of small fuel-efficient cars and trucks. The accommodation to unexpected large-scale production
shifts is limited by long and rigid lead times.
However, a shift to more fuel-efficient cars already had been started by the industry in the
planning, redesigning, and retooling for production of motor vehicles in order to meet the
government-mandated fuel efficiency requirements. 1
During most of the 1979 model year, despite
declining sales, production schedules for larger
cars were not pared fast enough to avoid a large
buildup in inventories of such vehicles. Auto
makers continued to assemble large cars at a relatively high rate for several reasons: (1) car manufacturers had anticipated another near-record
year of auto sales for 1979; (2) with the possi-
1. The Energy Policy and Conservation Act of 1975 set the
average fuel efficiency goals for autos at 19 miles per gallon
for 1979, 20 for 1980, and 27.5 for 1985.
124
Federal Reserve Bulletin • February 1980
1. Automobile production and sales
Millions of units
Sales
Year, or
quarter
Production
U.S.
Small cars
Total
U.S. and
foreign
Total
Foreign
models'
Standard
cars
Domestic
Compact
Intermediate
cars
Subcompact
9.7
7.3
6.7
8.5
9.2
9.2
8.4
4.5
4.0
4.7
4.9
5.4
5.6
6.1
1.7
1.4
1.6
1.5
2.1
2.0
2.3
1.7
1.8
2.4
2.8
2.3
2.4
2.1
1.1
.8
.7
.6
1.0
1.2
1.7
4.7
3.1
1.9
2.4
2.8
2.7
2.1
2.2
1.8
2.1
2.8
3.0
3.1
2.4
11.2
11.1
5.5
5.4
2.0
1.9
2.4
2.2
1.1
1.3
2.5
2.7
3.2
2.9
9.0
8.8
8.1
7.3
19782
Q3
Q4
19792
Ql
Q2
Q3
Q4
11.4
8.8
8.7
10.1
11.2
11.3
10.7
9.2
9.5
1973
1974
1975
1976
1977
1978
1979
11.6
10.7
10.8
9.8
6.6
5.9
5.8
5.9
2.3
2.5
2.2
2.4
2.0
2.2
2.3
2.0
1.9
1.8
1.5
1.5
2.7
1.9
2.2
1.9
2.7
2.2
2.7
2.1
1. Includes standard foreign cars.
2. Quarterly data are seasonally adjusted at annual rates.
bility of production being interrupted by a strike
in September, producers were willing to have
stocks of cars on hand somewhat larger than normal; (3) contracts for parts and components had
already been made by the industry for the remainder of the 1979 model year; and (4) the industry apparently anticipated a swing in demand
back to large cars such as the one that occurred
after the 1973 energy crisis.
The drop in auto and truck production in 1979
also affected output in related industries, as
could be expected. The amount of steel used by
the motor vehicle industry declined significantly;
original equipment tire production was cut sharply (a midyear strike occurred as well); and production of other auto-related goods, such as metal stampings, auto glass, and radios, was
curtailed during the year. However, these related
declines were not nearly so important for total
industrial production as the decrease in the output of motor vehicles and parts.
A UTO
PRODUCTION
Domestic production of autos totaled 8.4 million
units in 1979, about 740,000 units less than in the
preceding year; assemblies declined by about 30
percent between November 1978 and December
1979. Such overall comparisons, however, obscure the divergent movements in the output of
large (standard and intermediate) and small
(compact and subcompact) autos (table 2). Total
small-car production rose somewhat from 1978,
reflecting strong demand for smaller models
and expanded capacity for their production. In
particular, assemblies of subcompacts rose
sharply, increasing more than a fourth from 1978
to 1.5 million units, more than two and one-half
times the 1977 total. Output of large cars, on the
other hand, declined nearly a million units from
1978.
The change in the composition of output was
especially marked in the second half of last year.
Production of many 1980 models was delayed to
permit reduction of inventories, and in August
the output of small cars exceeded, for the first
time, that of larger cars in terms of contribution
to total industrial production. Large-car production was again reduced in November and December in response to renewed weakness in sales. In
comparison, small-car output peaked during the
third quarter but then declined in the last quarter,
as demand for these cars also weakened. The
shift in demand from large to small cars was similar to the changes experienced during the 197374 oil embargo, but in 1979 small cars accounted
for a much larger share of total auto output than
Production of Motor Vehicles in 1979
2.
125
Domestic auto and truck production
Percent change from preceding year
Type
Autos
Large
Small
Trucks
Personal use
Business
1973
1974
1975
1976
1977
1978
7.5
5.2
16.8
17.7
24.0
13.3
-22.0
-33.2
19.8
-5.0
-1.1
-8.0
-6.3
-14.5
10.7
-18.4
-4.9
-29.5
30.7
35.8
22.4
31.7
37.4
25.2
12.3
22.5
-5.4
22.9
15.8
31.4
—8.4
19.5
9.0
10.2
7.7
in the earlier period. Moreover, by early 1980
there was no indication of a shift back to larger
models.
AUTO SALES AND
STOCKS
The shift in demand toward small, fuel-efficient
vehicles began early in 1979, as concern began to
mount about a possible gasoline shortage after
the cutoff of oil supplies from Iran. Consumers
increased their purchases of subcompacts and
foreign cars and reduced their purchases of
larger cars and trucks. In the second quarter,
with severe gasoline shortages occurring in many
parts of the country, sales of large cars dropped
by a fourth (chart 2), and stocks of large cars at
dealers increased substantially further.
Consequently, the 4 'days supply" (inventories
related to the daily average of sales) of large cars
reached a new high in June; the previous high
had occurred in November 1974. Meanwhile,
during the first six months of 1979, overall inventories of small cars were reduced sharply, mostly
in the subcompact group. Stocks of several of the
newer downsized compact cars, with fuel economy comparable to some of the subcompacts, remained at low levels throughout most of the
year.
During the third quarter, in an effort to reduce
large-car inventories, auto makers offered price
discounts and rebates to buyers of most 1979
models to stimulate sales. And as mentioned earlier, producers delayed the introduction of the
large 1980 models. But after the rebates were discontinued and the 1980 models were introduced
at higher prices, large-car sales again fell sharply.
Late in the year, new sales incentives were offered for certain 1979 and 1980 models; large-car
sales again picked up somewhat but ended the
!
1979
Dec. 1979/
Dec. 1978
-8.0
-16.8
7.7
-14.4
-20.6
-7.7
-27.5
-44.1
4.4
-45.4
-46.1
-44.7
year below the rate at the beginning. As buyers
took advantage of the discounts to purchase
large cars, sales of small cars declined a little
in the third quarter, but ended the year at a rate
higher than that at the beginning.
The sales incentives and curtailed production
for the larger cars reduced inventories of these
models by the end of the third quarter, but inventories rose again in the fourth quarter. Stocks of
small cars rose to normal levels during the third
quarter, but rising sales at the end of the year
reduced them to the lowest level since May.
For 1979 as a whole, of a total 10.7 million
sold, a record 22 percent were imported models
(table 1). This shift in sales was stimulated by
the decline in the value of the Japanese yen relative to the dollar during 1979, which allowed
relatively stable prices on Japanese imports
while prices of U.S. makes were being increased.
In 1978, by comparison, prices of both Japanese and German cars had been increased frequently because of the declining foreign exchange
value of the dollar, and these cars had lost their
2. Sales of new U.S. and foreign autos
Seasonally adjusted annual rates, millions of units
.
Total
Large U.S.
1973
1975
1977
1979
126
Federal Reserve Bulletin • February 1980
3. Dealer stocks of new domestic cars, 19791
Days supply2
Stocks (millions of units)
Month
January
February ...
March
April
May
June
July
August
September .
October
November .
December ..
Total
Large
cars
Small
cars
Total
Large
cars
Small
cars
1.84
1.86
1.87
1.80
1.91
2.00
2.09
1.94
1.86
1.91
1.88
1.79
1.05
1.10
1.16
1.16
1.31
1.34
1.38
1.23
1.09
1.22
1.20
1.16
.79
.77
.71
.64
.60
.66
.71
.72
.77
.70
.68
.64
62.2
62.3
59.5
62.7
70.3
83.9
77.1
67.0
65.8
81.7
81.9
68.7
57.0
64.4
68.4
78.0
98.2
114.9
96.1
69.6
67.6
93.1
97.2
84.5
70.0
59.9
49.3
46.1
43.7
54.9
55.3
61.7
64.3
64.6
63.7
51.6
1. Data are seasonally adjusted.
2. The days supply is the ratio of car inventories in units to the daily
average of car sales. A 60-day supply of cars is considered adequate.
earlier relative competitive price advantage over
American-made subcompacts.
Sales of foreign cars, generally more fuel-efficient than American cars, increased 16 percent in
1979. These sales increased sharply in the first
quarter of the year from the fairly stable pace
that had prevailed throughout 1978 and continued to rise in the second quarter, as the gasoline
situation worsened (chart 2). Third-quarter sales
slowed, probably reflecting tight supplies of imported cars as well as the price reductions and
better delivery schedules for the large American
cars. During the fourth quarter, sales returned to
the record rate in the second quarter.
TRUCKS
During 1979, production of utility (personal-use)
vehicles was also severely curtailed. 2 In recent
years, consumers had increased their purchases
of personal-use vehicles, and by the end of 1978,
production was almost double the level of late
1974. With the growing popularity of these multipurpose vehicles, manufacturers had installed
more comfortable cabs and more accessories,
with accompanying increases in size and weight.
Since these changes had reduced the already low
fuel efficiency of these vehicles, sales were particularly hard hit by concerns about fuel availability and cost.
2. The utility vehicles group includes about two-thirds of
lightweight truck production—a key component of the group.
The lightweight truck group also includes vans and recreation vehicles.
With the energy crisis in the spring of 1979,
sales of light-duty trucks plunged and stocks accumulated rapidly. During the second quarter,
output was reduced substantially, and production lost during the transportation strike in April
was not made up. In the third quarter, sales of
the lightweight trucks recovered somewhat, but
inventory levels remained high relative to sales
and production schedules were again cut. Between the December 1978 production high and
the August 1979 low, output was reduced more
than three-fifths. This reduction, coupled with incentives that boosted sales in the latter part of
the year, resulted in some paring of inventories
from earlier highs. In contrast to the sales decline
in these light-duty trucks, sales of imported
trucks (mainly Japanese), which are smaller and
more fuel-efficient, increased 39 percent from
1978.
Production of trucks for business use also was
curtailed substantially in 1979. During the first
half of the year, output of these vehicles increased slightly despite the strike-related decline
in April. However, their production peaked in
May and then fell sharply for three successive
months, reflecting continued market weakness
in light-duty, business-use trucks and the first
signs of weakening demand for medium- and
heavy-duty trucks. Sales of these larger trucks—
frequently purchased on special order—decreased very slightly during the first half of 1979.
Output of all business vehicles fell almost 45 percent from May to August. After a partial recovery in production in September, output dropped
again in the fourth quarter. In the last recession,
the decline from the January 1973 peak to the
March 1975 trough had been about 45 percent.
O UTLOOK FOR EARL
Y1980
Sales of domestic cars improved somewhat in
January 1980, reflecting in part special programs to sell the remaining supplies of 1979-model large cars. Sales exceeded output during the
month, and stocks of these units were reduced to
more acceptable levels. Nevertheless, inventories of many models of cars remained high, and
relatively low overall production schedules for
the first quarter have been announced by the pro-
Production of Motor Vehicles in 1979
ducers. In addition, programs promoting sales
have been extended to some slow-selling 1980model cars. Output of subcompact cars is expected to increase somewhat, while a further cutback in production of large cars is planned. Total
auto output in the first quarter of 1980 is now
scheduled to be about 7 percent below the fourth
quarter of 1979 and roughly 25 percent below the
level of the first quarter of 1979.
The recent weakness in the medium- and
heavy-duty truck market and the continuing substantial inventories of light trucks have resulted
127
in a further small cutback in production schedules for both personal-use and business trucks
in early 1980.
In contrast to sales of domestic-model cars
generally, sales of imported cars in January rose
sharply and accounted for a record 27 percent of
the car market. Foreign car producers, particularly the Japanese, are being urged to begin production of motor vehicles in the United States,
as one German maker did in 1978. This producer
also began production of light-duty trucks in this
country in December 1979.
•
129
Industrial Production
Released for publication February 15
Output of durable goods materials edged up in
January as production of equipment parts advanced further; however, output of basic metals,
particularly raw steel, and parts for consumer
durables continued to decline. Production of
nondurable goods materials increased for the
seventh successive month with another large gain
for chemicals. Output of energy materials rose
0.8 percent.
Industrial production increased in January by an
estimated 0.3 percent; little change is now indicated for the three preceding months. In January,
the output of business equipment rose strongly
for the second month, and production of materials and consumer goods other than automotive
products moved up further. Motor vehicles and
parts output again declined sharply. The total
index for January, at 152.7 percent of its 1967
average, was 0.8 percent above its level a year
earlier but fractionally below the March 1979
high.
Output of consumer goods declined slightly in
January as auto assemblies—at an annual rate of
6.0 million units—were about 11 percent below
the rate of 6.8 million units in December. Production of other consumer durable goods rose
0.3 percent in January, and production of consumer nondurable goods, paced by advances in
output of consumer fuels and chemical products,
rose 0.4 percent. A further rise of 1.0 percent in
output of business equipment reflected strength
in commercial and manufacturing equipment and
a large increase in the production of building
and mining equipment. The latter represented
both continued strength in oil and gas well drilling and a post-strike rebound in output of construction and mining machinery. Production of
construction supplies again declined slightly.
1967 = 100
e Estimated.
Federal Reserve indexes, seasonally adjusted. Latest figures: January. Auto sales and stocks include imports.
Percentage change from preceding month
1980
Jan.e
152.3
149.9
147.2
148.9
147.6
149.4
174.5
159.8
156.3
156.1
Total
Products, total
Final products
Consumer goods
Durable
Nondurable
Business equipment
Intermediate products
Construction supplies
Materials
p Preliminary.
1979
Dec. p
Industrial production
S e a s o n a l l y adjusted, ratio scale, 1 9 6 7 = 1 0 0
152.7
150.1
147.4
148.4
144.4
150.0
176.3
160.1
156.2
156.6
1979
Aug.
-.8
-.7
-1.0
-1.7
-6.2
.2
.1
.8
.6
-1.0
Sept.
Oct.
.5
.8
1.1
1.0
2.9
.3
1.2
-.5
-.6
.2
-.1
-.2
-.3
0
.5
-.2
-.9
0
.3
0
NOTE. Indexes are seasonally adjusted.
1980
Nov.
-J
-.1
-.5
-2.2
.1
.4
-.1
-.1
-.1
Dec.
.1
.3
.3
0
-1.1
.5
1.0
.1
-.3
-.1
Jan.
.3
.1
.1
-.3
-2.2
.4
1.0
.2
-.1
.3
Percentage
change
Jan. 1979
to
Jan. 1980
.8
.6
.9
-1.5
-10.0
2.2
4.9
-.4
-1.8
1.0
130
Federal Reserve Bulletin • February 1980
Statements to Congress
Statement by J. Charles Partee, Member, Board
of Governors of the Federal Reserve System, before the Subcommittee on Financial Institutions
of the Committee on Banking, Housing, and Urban Affairs, U.S. Senate, January 24, 1980.
I appreciate the opportunity to appear before this
committee today to discuss questions relating to
money market mutual funds. The spectacular
growth of these relatively new intermediaries
certainly must be regarded as one of the major
financial events of the past year. The assets of
money market funds are rapidly approaching the
$50 billion mark, an almost fivefold increase
since the end of 1978. The number of shareholder
accounts over the same span has risen from
about 500,000 to close to 2 million.
The substantial growth in both total assets and
the number of shareholders indicates that many
households, businesses, and institutional investors have elected to allocate at least a portion of
their investable funds and transaction balances
to money market fund accounts. For investors
with limited resources, the funds are a convenient substitute for investing directly in the money market. For a management fee, the funds pass
through the earnings of a diversified portfolio of
large-denomination, short-term investments. Diversification in such market instruments would
otherwise be beyond the means or expertise of
most households and many institutional investors.
The escalation of interest rates on money market obligations to levels well above the rate ceilings applicable to time and savings deposit accounts at banks and thrift institutions has greatly
enhanced the competitive position of money
market mutual funds. To be sure, there would
have been a substantial increase in direct market
investment in any event, given the rate differentials that have prevailed. But the money
market mutual funds, by offering an alternative
investment tailored to customer needs, have pro
vided the market's most successful response to
rate controls on deposits.
Thrift institutions and many commercial banks
are constrained in their capacity to pay market
rates of return on all deposit liabilities because a
substantial share of their assets, being long-term
in character, carry the lower interest rate returns
of the past. Indeed, the increased attractiveness
to depositors of market instruments, including
the shares of money market mutual funds, has
led banks and thrift institutions to promote aggressively the money market certificate—their
one short-term deposit instrument whose ceiling
rate rises in tandem with six-month Treasury bill
rates. This has increased markedly the average
cost of deposits, so that many depositary institutions—especially those with large mortgage portfolios—have been experiencing substantial
downward pressure on their earnings margins.
Both commercial banks and thrift institutions
have undoubtedly lost deposits to money market
mutual funds. To be sure, large money center
banks, as well as a few of the thrift institutions,
have been able to recover some of these losses
through reinvestments by the mutual funds in
their large-denomination certificates of deposit
(CDs) and other liabilities. On net, money market fund acquisitions more than accounted for
the increase in large CD balances at banks in
1979. Money market funds, however, also invest
in the deposits of overseas banks and branches
(Eurodollars) and in commercial paper and other
domestic money market instruments. It is impossible to assess with any precision the ultimate
consequences for the distribution of credit of this
rechanneling of funds flows, but one result clearly has been some net shifting of financial resources away from local credit users and away
from the mortgage market.
The introduction this month of the two and
one-half year "small-saver" certificate, permitting both banks and thrift institutions to pay rates
of return indexed to changes in market rates,
Statements
should enhance the competitive position of depositary institutions, especially if short-term
market rates begin to decline and if expectations
of further declines become widespread. The effective ceiling rate is about equal to yields on
comparable market instruments, and both thrift
institutions and banks have the advantage of a
local presence. Other things being equal, I am
convinced that most people prefer dealing with
local institutions.
In recent years, the financial regulatory
agencies have taken a number of such steps to
provide the opportunity for savers to obtain
something more nearly approaching a market-determined rate of return at depositary institutions.
This is admittedly a slow process, because of the
earnings constraints imposed by the heritage of
low-rate, long-term assets at many of the institutions. But I believe that our actions are quite
consistent with our commitment to the gradual
deregulation of maximum rates payable on deposit instruments. The extension of Regulation
Q-type ceilings to money market mutual funds,
which some have proposed, would run counter
to this thrust.
To limit the yields on money market funds not
only would be anticonsumer—and inconsistent
with the nation's need to encourage saving—but
would also fail to recognize the inherent distinctions between deposits and money market
fund shares. Deposits at federally insured institutions offer the saver assets that are absolutely
free of risk of loss of principal, up to the $40,000
insurance limit per account, and that bear a fixed
yield to maturity. Money market fund shares, on
the other hand, are uninsured investments that
offer no certainty with respect to the yield that
will be earned over time. I do not want to leave
the impression that there is a substantial degree
of risk in money market funds—that does not appear to be the case. But they do entail some uncertainties not shared by deposits, and these
should be understood by savers.
The statements of policy that money market
funds must file with the Securities and Exchange
Commission (SEC) generally restrict the investments to high-quality, short-term money market
instruments. There is the possibility, however,
that a fund's investment in a particular asset
could represent a large enough share of the mar-
to Congress
131
ket so as to render the securities virtually illiquid
in certain circumstances. Moreover, there is
some exposure to a change in capital values in
the event of dramatic changes in interest rates,
although this risk is not appreciable so long as
average asset maturities are kept short. Portfolio
maturities currently average only about 40 days,
but there is no assurance that they may not
lengthen in the future. Also, there is always the
possibility of loss on fund assets, through
defaults by commercial paper issuers or other
borrowers, though this is minimized by the highquality commitment on paper held.
Money market mutual funds operate Under the
rules of the SEC, as stipulated by the Investment
Company Act of 1940. Oversight by the SEC
generally encompasses such considerations as
the truthfulness of advertising, the fairness of
valuation methods, and the use of legitimate investment and management practices. I presume
that these and similar factors are being effectively monitored by the SEC, thus providing
protection against risk of loss as a result of management impropriety.
Money market mutual funds generally allow
shares to be transferred to third parties by wire
and, often, by the use of check-like drafts. Shareholders thus are able to use these accounts for
transaction purposes above specified minimum
amounts. As substitutes in part for demand deposit checking accounts and for savings accounts, the rapid growth of the money market
funds clearly has had an impact on the performance of the monetary aggregates.
Data regarding the transaction uses of balances in money market mutual funds are very
limited, but reported average turnover rates are
relatively low—much lower than those for demand deposits and about in line with those for
savings deposits. This may indicate that high
minimum check sizes or check charges limit considerably the use of money market funds for
transaction purposes. It may also be that the
major portion of the amounts held in such accounts is intended for investment purposes, with
only a small portion being regarded by holders as
balances available to support ordinary transaction
needs. In recognition of the substitutability of
money market mutual fund shares for transaction
and savings balances at depositary institutions,
132
Federal Reserve Bulletin • February 1980
however, the Board plans to include such shares
in its redefinition of the monetary aggregates to
be published next month.
This brings me logically to the question of
whether reserve requirements need to be applied
to money market funds in order to enhance monetary control. The Board's answer at this point is
that it does not appear to be a critical problem.
There are, after all, a wide variety of financial
instruments, having varying degrees of liquidity,
that may act as substitutes for deposits. But if
money market fund shares over time begin to ex-
hibit more clearly the characteristics of transaction accounts, we may have to reconsider our position. So long as balances may be accessed by
checkwriting or other immediate transferability
features, the possibility remains that they may
develop into a substitute payments system. If so,
and in the context of our pressing need for a system of universal reserves on transaction balances
as a means to insure effective monetary control,
extension of the concept to money market mutual fund shares would then come to be in the
public interest.
•
Statement by Philip E. Coldwell, Member, Board
of Governors of the Federal Reserve System, before the Committee on Banking, Housing, and
Urban Affairs, U.S. Senate, January 25, 1980.
million or 5.6 percent above 1978 actual expenses. Total expenses for 1979 are now estimated to be $762.1 million, $47.4 million or 6.6
percent above the year earlier. The biggest contributing factor to the budget overrun of 1 percent was the largely uncontrollable expense for
the cost of Federal Reserve currency.
Despite mounting work pressures in 1979, the
Reserve Banks were able to reduce staff by 1.3
percent from the 1978 level, as compared with a
budgeted decline of 1.1 percent. Our estimates
for 1979 further reveal that Reserve Bank unit
costs continued to decline in 1979, and productivity gains continued to exceed those in the private sector.
Operating expenses for the Board of Governors for 1979 are estimated at $51,454,000 or
about 3 percent over the initially authorized budget of $49,862,000, reflecting both new demands
placed on the Board during the year and the additional costs for the semiannual cost-of-living allowance for retirees. Expenses for the renovation of the old building and completion of the
podium enclosure of the new building were other
added factors.
Mr. Chairman, I welcome the opportunity to appear before your committee today to discuss the
Federal Reserve System's budget performance
for 1979 and budget outlook for 1980. This marks
the fourth consecutive year I have testified before your distinguished committee, and as before, I am pleased to report continuing success in
holding the line on expense growth while achieving unit cost reductions and productivity increases in the face of increased responsibilities, inflation, and volume expansion. This success is a
tribute to the exceptional Reserve Bank management and Board senior and line management, to
the planning and budget control processes, and
to the painstaking efforts of all involved in preparing and adjusting to the budgets of the District
Banks and of the Board.
1979 BUDGET
PERFORMANCE
Before commenting on the System's 1980 budget, I would like to review our budget experience
in 1979. As indicated in my testimony last year,
the 1979 Reserve Bank budgets were adjusted
upward for implementation of the Community
Reinvestment Act and improved civil rights examination procedures, bringing the approved
1979 budget to a level of $754.4 million-$39.9
1980 BUDGET FOR THE
FEDERAL RESERVE
BANKS
The Board of Governors has approved 1980 Reserve Bank operating expense budgets totaling
$832.1 million, an increase of $70.0 million or 9.2
percent over estimated 1979 expenses. This in-
Statements
crease compares with an average annual expense
growth of 13.6 percent from 1970 through 1974
and an average increase of 6.8 percent from 1974
through 1979.
Approved Reserve Bank capital schedules
project 1980 outlays of $134.7 million, an increase of $66.1 million over estimated 1979 capital outlays.
The 1980 staffing level was established at
23,095, a decline of 73 or 0.3 percent from the
1979 estimated level. This staffing level would
bring the net reduction in staff to 3,624 or 13.6
percent since 1974. From 1974 through 1979 the
System's productivity improvements have been
averaging 9 percent per annum. The budget-year
estimate of productivity gain is 8 percent.
The budgeted expense increase for 1980 results from the upward pressure on costs due to
exogenous factors such as inflation, volume levels, labor market conditions, and legislative mandates, as well as endogenous factors such as upgrading and improving System services,
facilities, internal management systems and procedures, and our investment in the people who
work for the System.
Of the $70.0 million increase, salaries and benefits account for $40.2 million or 57 percent of the
increase. Officers' and employees' salary expenses are increasing 7.8 percent or $26.6 million. Expenses for retirement and other benefits
are increasing $13.6 million, primarily due to increased benefits to current staff and retirees, the
social security base increase, and hospital-medical insurance increases. The 1980 budget review
process focused on assuring that the Reserve
Banks' personnel compensation programs would
remain within the wage guidelines of the Council
on Wage and Price Stability.
Total equipment expense for 1980 is expected
to increase $9.1 million, accounting for 13 percent of the total budget rise. Higher maintenance
fees on equipment, particularly the new highspeed currency equipment, and higher depreciation costs for capital purchases in 1979 and those
planned for 1980 are partially offset by a decline
in rentals.
Shipping expenses are expected to advance
$6.0 million and account for 9 percent of the total
budget increase. The sharp rise in shipping costs
is a result of courier-rate increases due to higher
to Congress
133
fuel and labor costs, and System-directed efforts
to decrease float and improve service. In addition, the System's compliance with the Service
Contract Act affects our contracts for the transportation of cash and checks by requiring vendors to pay "prevailing wages" set by the Department of Labor. Obtaining full compliance
with the Service Contract Act adds $500,000 to
our 1980 budget increase.
Six percent of the total budget increase reflects
the $4.0 million rise in the cost of Federal Reserve currency after the 13.3 percent increase in
1979. A marked increase in the rate of currency
payments in some Districts continues both because of the proliferation of automated teller machines, which require new or high-quality used
currency in order to function reliably, and because of our attempts to improve the quality of
currency in circulation. A System effort to establish an overall currency quality standard and new
technological advances in automated teller machine technology, which allow equipment to improve handling of currency of mixed grade quality, should provide some cost relief in future
years.
The five objects of expense—salaries, benefits, equipment, shipping, and Federal Reserve
currency—account for 85 percent of the total
budgeted increase for 1980. Other sizable increases are expected in costs for materials, forms
and supplies, utilities, travel, and rent, which together account for 9 percent of the total budget
advance.
On a service line basis, the largest percentage
expense increase in 1980 is expected in supervision and regulation in which the 1980 budget
totals $77.1 million, an increase of 12.3 percent,
or $8.4 million. These activities are highly labor
intensive, and the increase in fact reflects a net
staff addition of 53 in 1980 primarily for: (1) full
implementation of the Community Reinvestment
and Electronic Fund Transfer Acts; (2) expanded
compliance reviews related to consumer protection and civil rights laws; (3) full implementation of the Board's expanded bank holding company inspection program; (4) expansion in the
scope of examinations for the Financial Institutions Regulatory and Interest Rate Control Act
(FIRA), and interagency electronic data processing examination procedures; (5) intensified ef-
134
Federal Reserve Bulletin • February 1980
forts to detect problem situations in bank holding
companies and member banks; and (6) assistance
as required by the states in the examination of
uninsured state-chartered branches and agencies
of foreign banks under the International Banking
Act (IBA). The 1980 budget provides for an increase of $1.0 million for the impact of the IB A.
The System has experienced relatively high
turnover in the examination staffs in several Districts in 1979 due to the competitive demand for
qualified people for bank management and other
industry jobs. This problem will continue to add
to expenditures in order to maintain and recruit
qualified staff and to enhance training and education programs.
Expenses for services to financial institutions
and the public constitute the largest portion of
the System's total 1980 budget and are expected
to increase by 9.2 percent, or $52.6 million. Expenses for services to the U.S. Treasury and
government agencies are projected to increase
6.9 percent, or $5.6 million partly as a result of a
projected increase in volume of 7.9 percent.
Even without adjusting for inflation, unit costs
are expected to decline at an average annual rate
of about 3.3 percent from 1977 through 1980.
Staff reductions totaling 165 are budgeted for
these service lines.
Major System initiatives are under way in the
payments mechanism area, which affect the increase in expenses for services to financial institutions and the public. During 1979 and continuing into 1980, considerable energy has been
expended on encouraging the use of automated
clearinghouse (ACH) services in place of the current check-clearing system in order to serve better the needs of the financial and business communities and to reduce float from transportation
delays. Two obstacles to ACH expansion have
been overcome by linking regional ACHs into a
nationwide network and by improving the ACH
funds availability and deposit deadline schedules. The expanded ACH schedules went into effect in the latter half of 1979, along with efforts to
improve the commercial sector's understanding
and participation in ACH payments services. We
estimate an incremental $1.2 million will be expended in 1980 to improve ACH services.
System efforts are also being mobilized to
achieve a level of float that is acceptable and ap
propriate to maintaining an efficient check-collection system without incurring excessive costs
and without exacerbating our membership problem. Because the level of float experienced over
the last several years is of particular concern to
me, and to you also, let me digress for a moment
to inform you of our varied efforts to reduce the
level of float without jeopardizing the achievement of other System goals.
A reduction in float can be accomplished in
several ways. Actions taken during the past year
and those actions endorsed for 1980 fall into the
categories of managerial techniques to improve
the efficiency of check clearing operations, resource expenditures to speed up Federal Reserve
processing, and policy changes regarding operations. These actions include (1) discouraging the
use of remote disbursement, (2) developing and
improving systems to monitor System float to reduce direct shipment float, (3) establishing annual float targets for each Reserve Bank, (4) reducing holdover float by increasing staff and
equipment, and (5) reducing interterritory float
by improving the design, flexibility, and timeliness of our interoffice transportation. These efforts have reduced the level of float from a high
of $9.6 billion in January, to $6.4 billion in June,
and to $5.9 billion in December 1979. Attachment 1 shows actual System float levels by quarter since 1975.1 Given historical experience, we
could have expected a fourth-quarter level of
float around $9 billion to $11 billion without System intervention in the form of the above actions. The effect of these programs on the 1980
budget increase is $1.8 million, exclusive of
transportation improvements currently under
study.
To achieve further substantial reductions in
float requires a change in System policy, which
may increase operating costs for member banks
and could affect our membership problem. Nevertheless, the Board has endorsed changing the
methods for handling large dollar value checks
by requiring the sorting out of all checks of
$250,000 and above and has asked staff for
1. Attachments to this statement are available on request
from Publications Services, Board of Governors of the Federal Reserve System, Washington, D.C. 20551.
Statements
prompt preparation of a plan for electronic check
presentment. In addition, the Board has instructed staff to review other means of reducing float
such as increasing the on-time performance requirements for direct-sending banks. Lengthening the availability schedules to reflect more
closely actual collection experience was rejected
as a regressive step in the improvement of the
payments mechanism and as a reduction in Federal Reserve services.
The steps we are taking to reduce float may be
perceived by the banks as increasing the burden
of membership, which adds to the urgent need
for the Congress to act on membership legislation. Just as float is seen as reducing Federal Reserve earnings returned to the Treasury, the
withdrawal of more member banks from the System, because of efforts to reduce float, would also diminish System earnings returned to the
Treasury. It should be noted that Federal Reserve payments to the Treasury rose $2.3 billion,
or 32.4 percent, to $9,279 billion in 1979.
Returning to our 1980 budget, there are several
automation efforts being undertaken that have a
significant effect on the direct and support expense increases for services to financial institutions and the public and services to the U.S.
Treasury and government agencies. The System has formulated a long-range automation plan
designed to standardize operating environments
to allow standardized application software. Implementation of the plan, which has as its goal to
increase the commonality of data processing operations in the twelve Districts and the Board, is
to begin in 1980. The 1980 budget increase includes $4.5 million in operating expenses for salaries, benefits, software, travel, education, and
equipment expenses to support the standardization program. The benefits of such a plan focus on the increased responsiveness of the System to policy changes and technological
innovations, faster response to changing service
needs of the national market, and a lessened
growth of data processing personnel.
During 1979 the network design and implementation planning phase for a new Federal Reserve
Communications System were completed. In
1980 we will turn toward software development,
equipment acquisition, and pilot operations. The
project, referred to as FRCS-80, involves the im
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135
plementation of a successor to the present data
communications network. Such a successor
would satisfy the internal communications requirements of the System, including contingency
backup, standardization, resource sharing, and
flexibility, and would provide a communications
capability for services to the financial community, the Treasury, and other government
agencies. The impact on the 1980 budget increase
is $1.1 million.
Another key automation effort influencing the
1980 budget is the implementation of high-speed
currency equipment to achieve improvements in
operating efficiency and productivity. Installation of these machines began in 1978 and will
continue through 1982. Several different vendors
were involved in developing prototypes, for
competitive purposes, but only two appear to offer a cost-effective potential. Although the machines require a heavy capital expenditure, the
benefits are substantial in terms of increased efficiency, security, and long-run staff reductions.
The projected staff declines in 1980 for services to financial institutions and the public (a reduction of 135) and services to the U.S. Treasury
and government agencies (a reduction of 30) are
the result of completed automation programs and
operational improvements. The new currency
processing equipment is already yielding savings
in the New York, Cleveland, Atlanta, Chicago,
and Minneapolis Districts. Automation efforts in
the areas of return items, cash functions, savings
bond operations, and government securities have
yielded staff reductions in several Districts. Boston, Cleveland, and Richmond have found staff
savings through consolidating fiscal departments
and centralizing the savings bond activity. The
completion of revised custody control standards
has allowed New York to reduce staff, and the
Minneapolis program to reduce coin wrapping
has allowed that District to cut staff. Chicago anticipates the reduction of 80 people in 1980
through the expansion of the regional check processing center clearing territory in late 1979.
The fourth service line is monetary and economic policy, which includes the Open Market
function at New York and the research and statistical function in all the Reserve Banks. Expenses are expected to increase 8.7 percent, or
$3.4 million, while employment is expected to in-
136
Federal Reserve Bulletin • February 1980
crease by 13, or 2.2 percent. The increases in expenses and employment are primarily attributable to new and revised Board-mandated data
reporting requirements for more effective monetary control.
Capital outlays for 1980 are significantly higher
than estimates for 1979 and are primarily for automation requirements and construction and renovation programs for our facilities. Outlays for
data processing-data communications equipment
total $45.6 million and include computer systems
at Richmond, St. Louis, Minneapolis, Kansas
City, and Dallas; telecommunications equipment
at New York; and acquisition of check processing equipment in the New York, Philadelphia,
Chicago, Dallas, and San Francisco Districts.
Outlays for other equipment total $16.8 million
primarily for high-speed currency processing
equipment. The budgeted outlays for building
machinery and equipment ($8.3 million), furniture, furnishings, and fixtures ($7.4 million), and
buildings ($49.6 million) are primarily for new
buildings at Baltimore, Miami, and San Francisco, and renovation projects at New York,
Omaha, Kansas City, and offices in the Dallas
District.
The 1980 budget planning process began in
early 1979 and culminated in the approval of a
1980 Reserve Bank budget objective setting an
upper limit of 8.0 percent on expense growth for
known factors and adding 1.0 percent to cover
the uncertain impact of legislation and Systemdirected programs in the areas of communication, automation, and the payments mechanism.
Exclusive of resources budgeted for these developments, the 1980 Reserve Bank budget increase
is 7.9 percent—within the established budget target. Our success in meeting budget targets for the
last several years is attributable to the detailed
planning efforts that go into coordinating the
adoption of System policies in line with resource
objectives.
1980 BUDGET FOR THE
BOARD OF GOVERNORS
The 1980 Board of Governors' budget is $56.1
million, an increase of 9 percent over 1979 estimated operating expenses and 6 percent over the
total of operating and capital expenditures for
1979. This increase compares with our estimate
of the federal government's fiscal year 1980 increase over 1979 of something like 13 percent
and fiscal year 1981 increase over fiscal year 1980
of about 9.5 percent. There are no capital funds
for 1980 for the Board.
The Board-authorized staffing level for 1980 is
1,561, which compares with 1,537 and 1,578 for
1979 and 1978 respectively. The increase from
1979 to 1980 is largely a result of new legislative
requirements and the System's automation standardization plans. It should be pointed out that
there was a 2.6 percent drop in authorized positions from 1978 to 1979. Actual employment is,
of course, somewhat less than authorized, and
we accommodate the difference by funding our
staff at a level lower than full authorization.
The Board's budget continues the trend of increases in the regulatory areas consistent with
new legislative responsibilities, particularly with
respect to the Community Reinvestment Act,
International Banking Act, and Financial Institutions Regulatory and Interest Rate Control
Act, other new consumer legislation, and Equal
Employment Opportunity requirements. Increased expenses also reflect support to the
new Federal Financial Institutions Examination
Council and a continuing effort to improve our
regulations.
Since personal services account for 82 percent
of the Board's budget, the federal government's
pay policies, which we largely follow, have a significant effect and, indeed, the 11 percent increase in personal services costs had to be offset
by a much lower increase in nonpersonal services to meet the final 9 percent budget. The lower
nonpersonal services increase of 5 percent is a
result of savings in space rentals, now that we
are contained in our two owned buildings, and
continued economy measures. In addition we
have imposed a $400,000 savings target, which
we expect to meet through managerial actions to
be taken during the year. The multiyear construction projects to renovate the Board building
and provide new space in our Annex building
have been completed.
The Board's 1980 budget formulation process
was built upon the extensive 1979 zero-base reviews. By concentrating on increments couched
within the zero-base format, providing early bud-
Statements
get guidance, and instituting additional automated budget presentation aids, the Board was
able to reduce paperwork by 35 percent while increasing productivity of budget preparation and
review. The Board's 1980 budget continues the
constraints of the past few years with internal
reallocations and minimal increases in staff to
meet high-priority initiatives.
SUMMARY
We are proud of our record of keeping expense
increases well below the inflation rate, of reducing cost per unit of output, and of improving out-
Statement by Paul A. Volcker, Chairman, Board
of Governors of the Federal Reserve System, before the Joint Economic Committee of the U.S.
Congress, February 1, 1980.
I am pleased to be here today to participate in
these hearings on the President's Economic Report, to present to you my views on the state of
the economy and to comment on what I consider
to be the advisable course for economic policy. I
believe there is now widespread recognition of
the priority that must be given to controlling inflation. I welcome this opportunity to discuss the
role of monetary policy in achieving the goal of
price stability and to explore ways in which other
policies also can contribute toward this end.
Shaping economic policy is not an easy task
even at the best of times. But the task has been
made considerably more difficult by the dramatic
changes that have been occurring recently in the
economic environment, both at home and
abroad. Actions by the Organization of Petroleum Exporting Countries continue to place
sharp upward pressures on the price of oil imported into the United States, while political disturbances in Iran and Afghanistan—among other
things—have increased uncertainties about future petroleum supplies and defense spending.
Here at home inflationary pressures have intensified, and these pressures have been accompanied by a heightening of inflationary ex
to Congress
137
put per manhour while maintaining the integrity,
security, reliability, and quality of Federal Reserve services.
This year will be a year of challenge for the
Federal Reserve System as changes in the financial industry and the economic and financial environment demand intensive regulatory, supervisory, and monetary analysis. The cost control
and employment reductions of the past provide a
streamlined organization to which in 1980 will be
added emphasis on the quality and levels of System services, improvements in the operating
work environments in the Districts, and a spirit
of increased cooperative sharing of ideas, talents, and resources.
•
pectations. While much of the acceleration in
prices can be attributed to rising energy costs,
our dismal performance in productivity has also
contributed appreciably. In financial markets,
high interest rates—themselves a by-product of
rapid inflation—have induced further financial innovation and institutional changes, which in part
have required changes in the way monetary policy is now conducted.
The uncertainties created by these developments are perhaps best highlighted by the almost
universal failure of forecasts made at this time
last year, and throughout most of the year, to
predict accurately the continued expansion of economic activity in 1979. Despite the shocks from
very large oil price hikes, fuel shortages, and major strikes, as well as the imposition of restraining macroeconomic policies, the economy
proved to be remarkably resilient. Growth in real
economic activity did slow in 1979 from the unsustainable 5 percent rate posted in the preceding
year, but real gross national product still advanced 1 percent over the four quarters of 1979;
the much-heralded recession never appeared.
The 1979 experience underscores how limited
our ability is to project future developments. It
reinforces the wisdom of holding firmly to monetary and other economic policies directed toward
the evident continuing problems of the economy—of which inflation ranks first—rather than
reacting to possibly transitory and misleading
138
Federal Reserve Bulletin • February 1980
movements in the latest statistics or relying too
heavily on uncertain economic and financial forecasts. In retrospect, recharting policy to respond
to tentative signs of a faltering economy last year
would have proven extremely costly to our antiinflation effort.
One of the major reasons why the forecasts for
1979 went wrong was the unanticipated behavior
of consumers. Despite the virtual cessation of
growth in real disposable income over the year,
consumption outlays continued to advance. The
desire of households to accumulate goods was,
no doubt, induced in part by the expectation of
worsening inflation. Indeed, surveys of consumer attitudes showed inflationary expectations
in the double-digit range virtually throughout the
year. Consumers could see both their savings
and income being eroded by inflation and were
willing to incur more debt and to save less in order to sustain their standards of living or to buy
tangible assets in anticipation of further price
rises. As a result, debt burdens reached new highs
in 1979 and the saving rate at the end of the year
was down to its lowest level since the Korean
War. One of the major uncertainties as we enter
1980 is how long consumers may be willing and
able to maintain behavior without much earlier
precedent.
It was encouraging that the nation's trade balance improved somewhat last year despite a dramatic increase in the value of our oil imports. Export
volume—for both
agricultural
and
nonagricultural products—increased by about 10
percent. Export markets thereby helped significantly in sustaining domestic production in 1979.
If the forecasts have proven to be wrong about
a recession in 1979, they do, I believe, reflect elements of potential weakness in some key sectors
and an increased overall vulnerability following
five years of expansion accompanied by the distortions of inflation. One major area of weakness
has already been evident—the auto sector. Auto
demand was damped last year by a series of
shocks—large gasoline price hikes, gas shortages, and concerns about future fuel availability.
Car sales dropped sharply in the spring and car
stocks backed up. Price cutting and companysponsored incentive programs helped work off
excessive inventories in the summer. On balance, however, demand appears to have weakened, with auto sales in the fourth quarter at the
lowest level since 1975. Indeed, sales have
dropped to the point that much of that adjustment may be completed.
Housing sector activity also slackened substantially. The rate of private housing starts
moved down early in 1979 from the 2-million-unit
pace that prevailed in 1978 and averaged VU million units during the first three quarters of 1979.
Late last year starts fell again, to an average of
172 million units in the final two months; permits
for new construction declined even faster. The
decline in residential construction last year reflected tighter conditions in mortgage markets as
well as some reduction of demands owing to
weaker financial positions of potential homebuyers.
In the business sector, there was a loss of momentum in capital outlays during 1979 as the fundamental determinants of spending became less
favorable. Growth of final sales slowed considerably after the first quarter, the capacity utilization rate in manufacturing edged lower, nominal
financing costs rose throughout the year, and
business sector balance sheets came under increasing financial pressure. Reflecting these developments, advance indicators of capital spending—such as orders and contracts—showed no
real growth during the year, and surveys of
planned outlays for 1980 also suggest a further
moderation in real capital outlays.
The slowing of economic activity during 1979
was accompanied by a less rapid increase in employment, but the moderation in employment
growth did not keep pace with the deceleration in
output growth. Although real output rose by 1
percent over the year, total employment increased 2 percent. At the same time, however,
growth of the labor force slowed. As a result, the
overall unemployment rate remained within a
narrow range of 53A to 6 percent.
Despite the moderation of output growth last
year, inflation worsened, and inflationary expectations became more deeply imbedded. The
acceleration in overall inflation in 1979 was due
in significant measure to the sharp rise in the
price of imported crude oil that resulted from the
series of price hikes instituted by OPEC. In addition, prices of domestic crude oil and many other
energy items also rose dramatically. Inflation,
however, was not confined to the energy sector
as underlying cost pressures intensified through-
Statements
out the economy, and prices, excluding energy
and food, rose faster than in the year earlier.
By last fall it was evident that inflationary conditions had deteriorated further and threatened
not only the stability of the U.S. economy but
also our position in the world economy. In response to the measures taken in November 1978,
the value of the dollar had risen, and this strength
continued into the first five months of 1979.
However, the failure of the U.S. inflation rate to
moderate, an acceleration of money and credit,
and the rapid rise in oil prices all contributed to
downward pressure on the dollar in the summer.
The dollar's weakness intensified in September
despite heavy intervention purchases of dollars
by U.S. and foreign authorities.
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139
Early in 1979, growth of the monetary aggregates
was effectively under control. But during the
spring and summer, money growth was much
faster than the Federal Reserve's longer-run targets. The System took a series of actions,
through its open market operations and through
increases in the discount rate, designed to contain excessive growth of money and credit. But
with continuing rapid growth of the aggregates
and with foreign exchange developments contributing additional upward price pressure and
exacerbating inflationary expectations, it became
clear that firm action was needed to avoid even
higher inflation. The risks were underscored by
an apparent buildup of speculative pressures in
commodity markets in September. The danger
was that the bidding up of prices in these markets
not only would in itself reinforce the inflationary
trends but that it would also lead to an unsustainable surge of buying. This was the setting in
which the Federal Reserve took its October 6
policy actions to deal with inflationary pressures
and defuse expectational forces. It was a setting,
too, that emphasized the fundamental point that
defense of the dollar internationally depends first
of all on actions at home to deal with our domestic economic problems.
those objectives could be achieved. Indeed, our
immediate objective was to rein in money and
credit growth.
Although explicit targets for monetary growth
have been a central feature of monetary policy
for several years, the operational guide for dayto-day open market operations before October
had typically been the federal funds rate. However, the translation of money stock objectives
into day-to-day management of this rate presupposes a stable and predictable relationship
between the public's demand for cash balances
and short-term market rates of interest. This
relationship becomes particularly difficult to appraise in an environment of rapid price increases,
changing inflationary expectations, and financial
innovations. Consequently, the Federal Open
Market Committee decided to emphasize controlling the volume of reserves available to support deposits in the banking system. 1 This
change in procedure was supported by two other
measures—an increase in the discount rate and a
marginal reserve requirement on increases in the
managed liabilities of larger banks. Our purpose
in this program was to signal clearly and forcibly
our unwillingness to finance an accelerating rate
of inflation and our desire to "wind down" inflationary pressures.
Following these actions taken nearly four
months ago, there was a period of turmoil and
unsettlement as the markets appraised and
adjusted to the new approach to implementing
monetary policy. Initial reactions in some markets may have been exaggerated, but at least
they reflected an appreciation of the seriousness
with which we viewed the problem of containing
inflation. Now the financial markets appear to be
functioning in a more orderly fashion.
With regard to our immediate objectives of
controlling monetary and credit developments, I
can report that the overall results have been remarkably in line with our intentions. Specifically, there has been a clear and significant moderation in the growth of money and credit. Growth
in M-l over the September to December interval
was well within the interim target of 4V2 percent
or lower set by the Federal Open Market Com-
As I have indicated on previous occasions, the
new steps did not involve any change in our basic
targets for the various monetary aggregates in
1979, but they did provide added assurance that
1. A technical description of the new procedures is available on request from Publications Services, Board of Governors of the Federal Reserve System, Washington, D.C.
20551.
MONETAR Y FOLIC Y IN 1979
140
Federal Reserve Bulletin • February 1980
mittee in early October, and growth rates for virtually all the aggregates have subsided markedly
from the excessive pace of the spring and early
summer of last year.
In terms of our ultimate goals, the picture is
much less clear. Fears expressed by some of a
precipitous drop in economic activity have not
been borne out, as the economy has continued to
grow at a modest pace in spite of the tighter policies. But the economy's strength reflects in part
consumer buying on credit or out of savings in
anticipation of continued inflation, and this does
not bode well for the long run. Other developments since October have not been encouraging.
Inflation remains about where it was, and gold
and commodity markets are once again highly
volatile—a development certainly related in large
part to international political and economic developments. These same developments had an
impact on exchange markets. The dollar retraced
most of its rise after October 6 but has held
steady in recent weeks.
We could not reasonably have expected to see
any significant damping of inflation over such a
short period of time. But, we must also recognize
that clear progress on the price front has probably been set back by at least a further quarter or
two as a direct result of the round of oil price
changes since early December, and the international disturbances have seemed to reinforce
concern about future inflation. This part of the
picture is not a happy one. But, I would remind
you that lags between action and reactions are
well-known, so we should be neither surprised
nor disheartened by the recent data. Monetary
policy—restraint on growth of money and credit—is only effective over time; but experience
shows that, with perseverance, it can and will be
effective. Recent events seem to me only to reinforce the need for disciplined policy, and I remain hopeful that signs of progress will emerge
over the next year.
LOOKING
AHEAD
With this background in mind, let me now turn to
a discussion of appropriate public policies over
the near term. Monetary policy has a central role
to play in combating inflation. But our recent experience underscores the complexity of the infla
tionary process—prices respond to a host of factors, including credit growth, demand management policies, external price shocks, productivity trends, expectations, and many others. In
view of this, I believe that we must develop
a coordinated set of policies designed to attack
inflation from a number of directions rather than
placing the entire burden on monetary policy. In
theory, monetary policy could do the job alone;
in practice, complementary policies are needed
to smooth the path and build the base for sustained growth. Moreover, if we are to return to a
noninflationary environment, it must be recognized that persistent application of anti-inflation
policies over an extended period is essential. I
am happy to note that the administration has emphasized these points in its discussion of policies
for stability and growth.
As we develop such policies, I would note that
our margins for error in some important respects
are smaller today than they used to be. In particular, I would underscore the importance of
avoiding errors on the side of excessive stimulus
in an environment in which inflation is already
deeply imbedded, a point also stressed in the
President's Economic Report. When inflationary
expectations are so volatile, we run the grave
risk that stimulation will be dissipated to a large
extent in higher prices rather than increased output. That is one price we pay for permitting inflation to make the headway it has for so long. The
potential costs of acting on the basis of forecasts
of slack that later prove to be incorrect are all the
higher in view of potential strains or disruptions
that could arise—for example, in the energy sector—that would further exacerbate inflationary
pressures. In that connection, I am aware, as I
am sure you are, that decisions on defense
spending will need to be taken into account in
appraising the outlook.
I know the committee does not expect me to
deal in detail with our monetary objectives,
pending testimony in relation to the HumphreyHawkins procedure. However, in terms of the
broad posture of monetary policy, these considerations translate into a prescription for persistently working toward noninflationary growth
of the money supply. There are questions on how
fast money growth should be cut back and technical issues of how to implement monetary policy, but I see no satisfactory alternative to slow-
Statements
ing the growth of money. Our policy, viewed in a
long-term perspective, rests on a very simple
premise—that the inflationary process is ultimately related to excessive growth in money and
credit. This relationship is of course a complex
one, and there are many facets of it that are sensitive to nonmonetary economic variables. But,
in spite of all the nuances, it is clear that inflation
cannot persist over the long run in the absence of
excessive monetary growth.
In this context, let me make an important analytic point—maintenance of restraint on money
and credit is consistent with movements in interest rates in response to market forces as they reflect credit demands, trends in economic activity, and, over time, inflation. Whether, when, and
to what extent interest rates move higher or
lower, these changes should not be misinterpreted or misconstrued as a departure from our intent to maintain disciplined growth in money and
credit over time. In that connection, I would emphasize that the prospects for sustaining any declines in interest rates that might develop in any
cyclical downturn will ultimately depend on success in the fight against inflation. In that context—but only in that context—lower interest
rates would not only be appropriate in facilitating
recovery, but they would also be evidence that
the foundations were being laid for a healthier
domestic economic situation and one consistent
with a stronger dollar internationally.
OTHER ANTI-INFLATION
POLICIES
I pointed out earlier the need for a coordination
of policies in order to avoid unnecessary costs
and disruptions as we work to restrain inflation.
Fiscal policy potentially can play a key role. In
the past, however, there has been far too much
of a willingness to accept budget deficits, in good
as well as bad years.
I believe it is imperative to keep the goal of
budgetary balance in the forefront of our thinking
about spending and revenue decisions, even
though our progress may at times be interrupted
by cyclical developments. It is particularly important, in my view, that tight control be exercised on total expenditures, and that we work
away at the objective often stated by the President in the past that the share of government
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141
spending to total GNP be reduced. In the current
international environment, that may not be feasible every year, but if and as defense priorities
rise, the clear implication is that we cannot
shrink away from even more intense scrutiny of
nondefense spending. Moreover, budget revenues must be managed prudently, and I especially applaud the President's decision to refrain
from recommending any new stimulative tax incentives at this time.
I am well aware that a strong case can be made
for well-structured tax changes; as the chairman
of this committee has often pointed out, we
should act to remove "supply-side" disincentives in the tax system. But desirable as
some types of tax cuts may be, particularly to
help deal with the urgent underlying problems of
productivity, costs, and incentives, such a program needs to respect the fiscal priorities. Otherwise the potential favorable effects would be
swamped by a new spur to inflation, even more
congested credit markets, and more economic instability. Put simply, net tax reduction can only
be earned by restraint in expenditures over time,
and that time has not yet come.
When the time does come for tax reduction, it
should be designed with a sharp focus on achieving the nation's goals. A number of possible tax
measures to reduce costs could be considered in
this regard, including for example reexamination
of the extent to which we rely on payroll taxes.
But, it seems to me, tax restructuring should
place major emphasis on stimulating business investment and enhancing productivity growth. To
my mind, it would be a policy mistake of the first
magnitude to dissipate opportunities for tax reduction, when and if they do arise, in measures
that simply add to spending without helping to
resolve the underlying problems.
Over the longer run, productivity growth is
one of the keys to containing inflation, as well as
being the prerequisite for raising living standards. Recent performance in that respect has
been dismal. During the two decades following
World War II, output per hour worked was rising
on average about 3 percent per year; since the
mid-sixties, the increase has trended lower, climaxed by an actual decline in 1979.
One of the reasons for the slowdown in productivity growth over the past decade has been a
slackening in the rate of capital formation. In-
142
Federal Reserve Bulletin • February 1980
deed, the nation's stock of capital grew at only a
2V2 percent rate over the last five years—about
half the pace of the preceding decade. Capital accumulation per member of the labor force has
slowed even more dramatically; the stock of capital per worker has actually declined on average
since 1975, and more of our present capital stock
appears less directly "productive" in the sense
that it is motivated by environmental or other
considerations. It is clear, then, that we must design our economic policies in a way that will encourage saving and investment, and improve the
rate of capital formation, if we are to ensure the
ability of the economy to provide sustained advances in living standards and to meet those
other objectives not captured in the production
statistics.
Another element in the long-range program to
increase productivity and living standards, and
reduce inflation, would be a new look at the federal government's regulatory activities—both social regulations and economic regulations. This
year's Economic Report discusses the need for
striking a proper balance in regulation, an area
where, I sense, sound concepts of comparing
costs with benefits have been sorely lacking. I do
not underestimate the difficulty; reality is complex and each new regulation seems to generate
its own vested interests, with talented and vocal
advocates. Yet, instances where obsolete government intervention actually hurts, rather than
helps, the consuming public have often been
cited, and newer regulations can be challenged
on the same grounds. Even in areas where elimination of government regulation would clearly be
inappropriate—such as the protection of the environment, health, and safety—I feel certain we
can do a better job in assuring that the benefits of
protection are weighed carefully against the
costs of achieving them.
In the context of declining productivity, it is
even more apparent that moderation in wage
growth is needed if we are to gain control over
inflation. Last year, hourly compensation increased about 9 percent. Combined with an actual decline in productivity of more than 2 percent, these wage increases drove unit labor costs
up more than 11 percent—a marked acceleration
from 1978 and thus a substantial source of added
inflationary pressures. I welcome any assistance
that can be obtained through cooperative and
voluntary programs by way of educating business and labor as to the need for restraint and in
heading off excesses. An effective program, emphasizing the ultimate futility of attempts to recover losses of real income required by productivity declines or external shocks potentially can
dampen a ratcheting up of the wage-price spiral.
But let us recognize, too, that experience here
and abroad confirms that such programs cannot
be the backbone of an anti-inflation policy. And,
let us also appreciate, and avoid, the risk that
such programs may lull us into thinking they are
a substitute for monetary and budgetary discipline; in that event, the net effect would be
counterproductive.
Of course, we will remain highly vulnerable to
external developments so long as we are heavily
dependent on imported oil. I will note, without
belaboring a point that has been made so many
times, that recent events only underscore the
need to come to grips with this problem.
Part of the solution seems to me to require that
we recognize the need to allow increases in the
price of oil and related products to reflect their
true scarcity. Sometimes the short-term impact
of such a policy on the price indexes is cited as
an almost insuperable obstacle to such an approach. To be sure, the short-term dilemma reinforces the need for firm anti-inflation policies to
avoid further increases in inflationary expectations. But benefits over time would be substantial, for the longer we delay adjusting to the
realities of the energy markets, the longer we will
be vulnerable to spiraling prices at inopportune
times, to say nothing of physical shortages.
The period we are now in surely will test our
patience, our wisdom, and our common sense.
The problems we face are not easy ones, and the
policy decisions they call forth are not necessarily going to win popularity contests today. Yet,
what strikes me is the understanding by the
American people of some basic truths: the need
for economic restraint, applied consistently and
persistently; the fact that creation of money is no
substitute for production and productivity; the
absence of painless quick fixes.
You are better judges of the national mood
than I. But I do have certain convictions. Events
of recent years have given all of us—from our
national leaders to the most humble c i t i z e n some insight into what it means to really have to
Statements
to Congress
143
worry about the value of the dollar, at home and
abroad, not just its implications for economic
stability and for our national pride, but for our
sense of value and our ability to exercise leadership in the world. There is no longer any soft or
easy option of simply accepting another turn of
the inflationary screw as a by-product of buying
our way out of stagnation or slump. I also know
the "payoff" over time from policies to restore
stability and productivity can be huge for all
Americans. That is why I feel so strongly we
must "stick with it" until the job is done.
•
Statement by Paul A. Volcker, Chairman, Board
of Governors of the Federal Reserve System, before the Committee on Banking, Housing, and
Urban Affairs, U.S. Senate, February 4, 1980.
Federal Reserve membership intensifies. In the
three years that the Congress has debated this
issue, the proportion of bank deposits held by
member banks dropped from 73 percent to about
70 percent. That drop occurred despite the fact
that many institutions have been willing to defer
withdrawal from membership while awaiting legislation that would result in more equitable conditions. Now, it is evident that patience has run
thin. During the fourth quarter of 1979 and the
first few weeks of 1980, 69 banks with about $7
billion in deposits have given notice of withdrawal from membership. The loss of deposits in
this short period exceeds that of any full year.
The recent withdrawals by two very sizable
banks in Pennsylvania, with more than $3 billion
in deposits between them, seems to me especially significant. They show that much larger institutions than before are now prepared to take
the step. As one banker has put it, the cost of
membership is "too high a price to be a member
of anything."
It is my judgment, and that of many others,
that, in the absence of legislative action, the
stream of member banks that withdraw will
reach flood proportions. Financial innovation,
shifting competitive patterns, and strong inflationary pressures with their related high interest
rates, all have contributed to an increasing burden of membership. It has become progressively
more costly and more difficult for banks to justify
continuing their membership. It was not so long
ago that, among medium-sized and larger banks,
membership was pretty much taken for granted.
Now in more and more areas of the country, that
attitude is being reversed; it is continued membership that has to be justified to the stockholders and customers that ultimately shoulder
the burden. Even banks conscious of the importance of a strong central bank and reluctant to
give up a national charter find that justification
I am grateful for this opportunity to testify once
again on certain proposals this committee is considering to ensure the continued capacity of the
Federal Reserve System to conduct effective
monetary policy in the years ahead. I am convinced that, after long debate and with a final effort by this committee, a fully satisfactory legislative solution can be enacted in a matter of
weeks—legislation that would have broad support from the interested constituencies, would
fall within acceptable limits of cost to the Treasury, and most important, would enable the Federal Reserve to maintain disciplined control of
the money supply and to meet its other responsibilities for protecting the safety and soundness of
the banking system.
The need for legislation is strongly reinforced
by the decision of the Federal Reserve to adopt
new operating procedures on October 6. These
new procedures—which are described in an attachment to this testimony—place much greater
emphasis on reserves as the instrument for controlling money growth. 1 Thus far, the procedures
have worked reasonably well. But their effectiveness will be undercut as the share of money not subject to reserve requirements set by the
Federal Reserve increases. Legislation to keep
Federal Reserve control over the nation's reserve base from atrophying further is, in that
context, an essential element in our anti-inflation
program.
As we deliberate, the problem of attrition from
1. The attachments to this statement are available on request from Publications Services, Board of Governors of the
Federal Reserve System, Washington, D.C. 20551.
144
Federal Reserve Bulletin • February 1980
increasingly difficult or impossible in light of the
heavy burden involved.
A recent survey by Reserve Banks, based entirely on information volunteered by members in
the normal course of business, found that 320
member banks were considered certain or probable to withdraw. Another 350 were actively considering withdrawal. These 670 banks—some of
which have already initiated withdrawal procedures—represent more than 10 percent of the
System's membership and have in excess of $71
billion in deposits. If these banks, in fact, withdraw, deposits of banks holding federal reserves
will decline to 64 percent of the deposits of the
banking system. And there is no doubt in my
mind that many more banks are considering
withdrawal than have come to our attention and
that the momentum will build further.
I would remind you that loss of members has
several adverse effects on monetary control, the
soundness of the banking system, and the strength
of the Federal Reserve. As attrition causes the
total amount of reserves held at Federal Reserve
Banks to decline, the "multiplier" relationship
between reserves and money increases and tends
to become less stable. Consequently, fluctuations
in the amount of reserves supplied—and these
fluctuations inevitably have a range of uncertainty—can cause magnified and unintended
changes in the money supply. As attrition increases the proportion of deposits held by nonmember banks, the possibility of unanticipated
(and unpredictable) shifts of deposits between
member and nonmember banks increases, destabilizing the relationship between reserves and
money.
As banks leave the System, they also lose
ready access to the Federal Reserve discount
window. Operation of the window not only can
assist otherwise sound banks to weather unexpected deposit outflows but also can provide an
essential safety-valve function for the monetary
system as a whole by enabling individual institutions to adjust more smoothly and without disruptions to changing credit conditions. At the
same time, the Federal Reserve is losing the intimate supervisory surveillance of individual institutions important to the administration of the
discount window and the effective discharge of
our supervisory and regulatory responsibilities.
Finally, the structural consideration so central
to the formation of the Federal Reserve System
would become relevant again as larger and larger
segments of the banking industry come to hold
their entire operating and liquidity reserves at
other commercial banks rather than maintaining
balances with the Federal Reserve Banks. In this
setting, localized strains may more readily be
transmitted to other banks, and individual failures could have more serious repercussions.
Among the relevant criteria for evaluating any
proposed legislation are how many banks are
covered, the proportion of deposits held by those
banks, and the size of the reserve base itself in
relation to deposit totals. We have no formula for
deciding precisely how large reserve balances
need be, or how they should be distributed, to
ensure effective monetary control and a wellfunctioning banking system. I am convinced that
reserve requirements must be more equitably
distributed among the nation's banks, and I also
feel quite sure the Federal Reserve can meet its
reponsibilities with a smaller reserve base than
we now have. But I have grave doubts whether
coverage and the reserve base could be reduced
as drastically as in the bill (H.R. 7) passed by the
House without serious adverse implications for
monetary management.
Theorists have put forward arguments that,
under certain operating hypotheses, required reserves may not be needed at all, let alone in sizable amounts. The rather abstruse arguments
may or may not be valid in certain circumstances. But we at the Federal Reserve are not
prepared—least of all at this critical juncture for
our economy—to commit ourselves to experiments with monetary policy on the basis of untested theorizing about operating without sufficient reserve balances. You will properly hold
us accountable for contributing to progress in
dealing with inflation and the other economic
problems that beset us. For our part, we must
have adequate tools to meet that challenge.
In our opinion, a reduction in reserve balances
held at Federal Reserve Banks (expressed in
1977 terms) to as little as $10 to $15 billion—or
about $11.5 to $17 billion in 1979 terms—could
prove adequate to conduct monetary policy, provided it is distributed equitably across depositary
institutions having transaction accounts. But we
Statements
are not certain of that outcome, and that level of
balances—some 4 to 6 percent of transaction
balances and less than 1.5 percent of total deposits in depositary institutions—might not even
adequately support Federal Reserve operational
requirements. For that reason we would strongly
urge at least standby capacity to obtain somewhat larger balances—up to $20 billion or more
in 1977 terms. H.R. 7, in contrast, provides for
less than $8 billion of balances (in 1977 terms),
distributed among only 450 banks.
The monetary policy need for an adequate level of reserve balances creates something of a
quandary. Reduction of reserve balances of member banks to that level would not be sufficient
to stem attrition in a purely voluntary system,
because it plainly would not eliminate the burden of sterile reserves of federal members. On
the other hand, a reduction in reserve requirements large enough to stop attrition would not
provide a satisfactory level of reserve balances
from the viewpoint of monetary policy. S. 353
would attempt to resolve this quandary, within
the context of a voluntary system, by paying interest on the reserves held after some reduction.
S. 85 and H.R. 7 approach the problem by making
lower, non-interest-bearing reserve requirements
mandatory for all depositary institutions having
transaction types of accounts. However H.R. 7
provides too small a reserve base covering too
few institutions. S. 85 would achieve a much
more sizable reserve base than H.R. 7. But it
does so at the expense of sizable requirements on
time deposits—requirements high enough to burden significantly covered institutions relative to
competing market instruments.
THE FEDERAL
RESERVE
MODERNIZATION
ACT (S.
353)
As I just indicated, the amended version of S.
353, proposed by Senator Tower, would deal
with attrition from Federal Reserve membership
in the context of a fully voluntary system. The
bill seeks to eliminate the burden of membership
by reducing requirements against most deposits
and mandating that all balances held at the Federal Reserve to meet reserve requirements earn
interest at rates close to, but still somewhat short
to Congress
145
of, market rates. Access to services would be restricted to members and to other institutions voluntarily maintaining balances in an amount equal
to those required of a member of the same deposit size and configuration. Those services would
be fully priced.
Senator Tower's bill, unlike H.R. 7 and S. 85,
provides for reserves on all savings deposits and
on all time deposits of less than 180-day maturity. Such reserves would be interest bearing, and
therefore would not have the same " t a x " effect
associated with such reserves in a mandatory
framework. Thus, there would not be so strong
an incentive to shift funds from these types of
accounts because of the reserve requirement, a
phenomenon that has been of great concern to
the Board in the context of mandatory reserves
on time and savings accounts. Nevertheless, it
seems apparent that members would still feel
somewhat burdened relative to other institutions. In that connection, I would point out that,
to maintain an adequate reserve base, actual reserve requirements imposed within the framework of S. 353 would need to be in the upper part
of the ranges specified in the bill.
I have examined this approach with care and
have sympathy for its objectives because, as I
have indicated to the committee before, I understand and share the nostalgia for retaining elements of voluntarism in the operations of the
Federal Reserve System. But, we simply cannot
rely on nostalgia in conducting monetary policy.
It is the considered conclusion of the Federal Reserve Board that the voluntary approach cannot
practically be made effective within the framework of acceptable revenue loss to the Treasury
and other objectives. Indeed, it is our judgment
that membership attrition would probably continue, although at a much slower rate.
Based on 1977 data, the cost analyses of the
basic provisions of S. 353 that I have attached
show that the net cost to the Treasury of implementing that bill would fall in the range from $450
to $520 million annually. This appears to be far in
excess of amounts acceptable to the administration or to many members of the Congress. The bill
also encompasses the possibility of a mandatory
supplemental deposit on transaction balances in
an " e m e r g e n c y . " As t h e a p p e n d i x table indicates, with such supplementary deposits yield-
A 146
Federal Reserve Bulletin • February 1980
ing IV2 percentage points less than a market rate
(as would be the case under the amendment to S.
353 supplied to the Board by Senator Tower), the
net cost would still not be reduced to acceptable
levels even if the supplemental provision were to
be invoked.
The dilemma is that without payment of interest on reserves at or very near market rates, a
purely voluntary system cannot stem attrition,
but the payment of that interest drives up the
cost. Moreover, it seems unlikely that—in view
of the highly efficient correspondent banking network throughout the country—many nonmember
institutions would be prepared to place equivalent balances with the Federal Reserve to obtain access to services. Indeed, under S. 353
the effectiveness of monetary policy, whether
viewed in terms of the size of the reserve base or
ongoing access to the discount window, might ultimately swing on the extent to which nonmember institutions maintained balances to obtain federal services. In any event, we would be
left with the increasingly awkward problem of
discriminating between members and nonmembers in the provision of certain services, such as
automated clearinghouse payments, which for
practical reasons cannot operate efficiently unless
open to all depositary institutions. Indeed, even
now nonmembers have access to those automated
services.
Therefore, I must conclude that attention should
be directed toward approaches that would apply
reserve requirements to depositary institutions
on a universal and mandatory basis. Such a universal approach has the enormous benefit of
equitably applying reserve requirements to comparable accounts—at thrifts as well as banks, at
members as well as nonmembers. This is particularly important with respect to rapidly growing
components of the nation's basic money supply,
negotiable order of withdrawal (NOW) and automatic transfer service (ATS) accounts, many of
which now escape reserve requirements altogether.
I can readily sympathize with the desire to
maintain a voluntary system wherever possible
in the provision of governmental services. But, it
would be ironic indeed to insist upon the approach for philosophical reasons in an area—
control of money—that is clearly a specified
constitutional function of the federal government,
even at the expense of impairing the effectiveness with which that function is discharged.
SUPPLEMENTARY
DEPOSITS
It is possible to reconcile the seemingly conflicting objectives of equity for financial institutions,
acceptable limits on the loss of Treasury revenues, and the provision of a large enough reserve
base to ensure the effective conduct of monetary
policy by use of a standby authority for interestearning supplemental deposits at Reserve Banks
along the lines that I suggested to the committee
last fall. Provision for such a supplemental deposit would permit us to attempt to operate with
a relatively small reserve base, while providing a
"safety net" should experience prove that base
inadequate to obtain sufficiently precise control
over the money supply. It would entail no added
cost to the Treasury and virtually no cost to the
banking system. And, from a legislative viewpoint, it could easily be made part of any of the
bills before the Congress.
The amendment proposed for S. 353 in fact
seems to accept the general logic of that approach. However, the preconditions for the imposition and retention of the supplement as specified in the amendment appear so restrictive as to
impair its value. The amendment stipulates, for
example, that the Board must find that the supplemental deposit is the only means to maintain
effective control over monetary growth, and it
requires a unanimous vote of the Board, provisions that might make it impossible to use the authority even if the overwhelming majority of the
Board felt it had enormous advantages over any
conceivable alternative.
The provision in the amendment that stipulates
that the authority for the supplemental deposit
will expire after four years is perhaps a still more
serious flaw. It may or may not be needed in four
years. But, if the expiration date came at a time
when supplemental deposits were in place, an
obvious problem would be created because the
authority would not be in use at that time unless
it was needed. On the other hand, the fact that it
had not been used in four years should not indicate that it would never be necessary. We have
Statements
no dispute with the point that the authority
should not be used lightly, and we would be glad
to propose procedural safeguards to reinforce
that point without vitiating its potential usefulness in a time of need.
to Congress
147
quirements. We are prepared to supply an appropriate amendment that could be attached to S.
353 or to any bill that would deal with the problem.
CONCLUSION
PROVISIONS OF SERVICES
AND OTHER ISSUES
The amendments to S. 353 offered by Senator
Tower to require charges for Reserve Bank services and for float are, in principle, acceptable to
the Federal Reserve, and similar provisions are
in other bills. We believe that pricing is a natural
corollary to open access—but I would also emphasize, however, that open access and pricing
are practicable only after reserve requirements
are restructured and applied to all depositary institutions.
Pricing of System services likely will induce
major changes in existing banking relationships.
It may have differential effects on large and
small, or city and rural, institutions. Overly rigid
application of the principles, however sound
these principles are, could cause disruptions in
banking markets. Consequently, I would urge
that the pricing provision allow a degree of flexibility in timing and implementation. For instance,
it should be clear that the Federal Reserve need
not precisely match costs and revenues for every
service.
I would also urge that the Board be given authority, similar to that provided in H.R. 7, to permit exceptions to full-cost coverage where required by the public i n t e r e s t , c o m p e t i t i v e
condition, or the provision of an adequate level
of services nationwide. Indeed, the Board questions whether a charge for the receipt and disbursement of a new currency is appropriate at
all. The government might normally be expected
to provide that service, and in any event, the
Treasury already earns some $7 billion per year
from the provision of currency through the interest earned on securities held by the Federal Reserve as collateral against that currency.
The committee also should note that S. 353
does not address the technical problems relating
to collateralization of Federal Reserve notes that
can rise under legislation that reduces reserve re
I am convinced the essential elements of legislation to provide the Federal Reserve with the
tools it needs to meet its responsibilities are at
hand. The Board of Governors believes these
elements should give concrete embodiment to
the following principles, and these principles can
be achieved without revenue loss.
1. Reserves should be applied to all transaction accounts. Some relatively low exemption
level or a system of graduated requirements for
the smallest institutions can be accommodated
within this principle.
2. When and if reserve requirements are imposed on time deposits, they should be confined
to short-term, nonpersonal accounts and should
be at a relatively low level.
3. To establish comparable competitive conditions, reserve requirements should be equal for
all despositary institutions offering comparable
accounts.
4. Authority should be provided to ensure that
the reserve base is of adequate size for the efficient and effective conduct of monetary policy.
5. Access to Federal Reserve services should
be open to all depositary institutions with transaction accounts, and the Reserve Banks should,
in principle, aim to recover the full cost of those
services from pricing—provided all institutions
have a comparable reserve burden.
6. Consistent with the dual banking system,
institutions should remain free to choose a state
or federal charter, and membership in the Federal
Reserve System, with its implications for certain
supervisory matters and for the election of Federal Reserve Bank directors, should remain voluntary.
These principles already are incorporated into,
or could readily be added to, two bills that are
before you: S. 85 and H.R. 7. Last September I
testified at length on specific modifications to improve S. 85 or H.R. 7 to bring them more fully
A 148
Federal Reserve Bulletin • February 1980
into line with the essential objectives, and I have
little to add to the comments I made at that time.
In conclusion, let me express again the Board's
deep concern that prompt action be taken to
ensure that the Federal Reserve has, and for
years to come will continue to have, adequate
tools to manage the nation's monetary affairs
and to ensure a sound and safe banking system. In light of the many new uncertainties
facing our nation both at home and abroad, and
the enormous challenge of dealing with inflation,
we cannot responsibly permit attrition from membership to grow to the stage where it seriously
disrupts monetary management and calls into
question the strength and independence of the
nation's central bank. I fear we will soon be
perilously close to that point. The principles I
have stated are consistent with prompt action.
We must not permit the opportunity before us to
slip away.
•
149
Announcements
NEW DEFINITIONS
OF MONEY
The Federal Reserve Board on February 7, 1980,
announced new definitions of money that will
be used in the conduct of monetary policy.
The redefinitions, which have been under
study for several years, were prompted by many
financial developments that have reduced the significance of the old measures. Among these developments are the emergence of negotiable order of withdrawal (NOW) accounts, automatic
transfer services (ATS), and money market mutual funds and a growing similarity between deposits in commercial banks and thrift institutions.
One of the new definitions is essentially the
same as the old narrowly defined money supply
(M-l) while a second concept will include transaction accounts of all depositary institutions.
The new definitions of money are as follows:
M-l A is currency plus demand deposits at
commercial banks. This is essentially the same
as the old M-l with one exception—it excludes
demand deposits held by foreign banks and official institutions.
M-1B equals M-l A plus other checkable deposits at all depositary institutions including
NOW accounts, ATS, credit union share drafts,
and demand deposits at mutual savings banks.
M-2 equals M-1B plus savings and small-denomination time deposits at all depositary institutions, overnight repurchase agreements (RPs)
at commercial banks, overnight Eurodollars held
by U.S. residents other than banks at Caribbean
branches of member banks, and money market
mutual fund shares.
M-3 equals M-2 plus large-denomination time
deposits at all depositary institutions and term
RPs at commercial banks and savings and loan
associations.
The Board also adopted a broad measure of
liquid assets, L. L equals M-3 plus other liquid
assets not included elsewhere such as term Eu
rodollars held by U.S. residents other than
banks, bankers acceptances, commercial paper,
Treasury bills and other liquid Treasury securities, and U.S. savings bonds.
In addition to regular publication of these new
measures, the Board will publish their principal
components.
A detailed explanation of the new measures is
published in this issue of the F E D E R A L R E S E R V E
BULLETIN.
REGULATION
E: FINAL
RULES
The Federal Reserve Board on January 31, 1980,
announced adoption of additional final rules to
complete its Regulation E (Electronic Fund
Transfers) and to implement the Electronic Fund
Transfer Act.
The Board previously had adopted regulatory
rules to carry out sections of the act effective
February 1979 and May 10, 1980. The new rules
concern other provisions of the act becoming effective in May.
The new rules are revisions of proposals published by the Board in October. In general, they
deal with requirements for documentation of
electronic fund transfers by financial institutions;
notification requirements in connection with preauthorized electronic receipt of funds; requirements for prompt crediting of funds received
electronically; procedures for resolving errors;
and responsibility for compliance when an EFT
card or similar device is issued to a consumer by
an EFT service provider who does not hold the
consumer's account.
The Board decided to take no action at this
time on a proposal made in October concerning
charges made by financial institutions in connection with error resolution. The Board said it
will monitor industry practice regarding such
charges and will take action if consumers appear
to need protection in this area.
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Federal Reserve Bulletin • February 1980
The Electronic Fund Transfer Act 1 protects
consumers in their use of EFT services. EFT
services permit consumers and others to transfer
funds without the use of checks. One means by
which funds can be transferred is through use of
an EFT card. Consumers can use EFT cards to
make payments—for example, at the point of
sale to authorize a debit of the consumer's account at a financial institution in payment for the
purchase of goods or services. This usage differs
from a credit card in that the EFT card authorizes funds to be taken directly out of the consumer's account while the credit card creates a
debt that the consumer pays at a later time. The
EFT card may also be used at automated tellers
to withdraw cash from the consumer's account.
Consumers may use other EFT services to authorize the electronic deposit of payments due to
them (such as electronic deposit of wages, social
security benefits, dividends, and similar repetitive deposits) or for payment of their bills.
The new rules adopted as part of Regulation E
include these details:
1. Documentation of transfers. The act requires that financial institutions document electronic transfers by making receipts available at
automated teller machines or point-of-sale terminals, and by sending consumers of EFT services
periodic statements. Regulation E includes the
following requirements: (a) Financial institutions
must show on periodic statements the date a
transfer was debited or credited to the consumer's account. (An earlier proposal to require
the date the transfer was initiated was not
adopted.) (b) A financial institution may show
the location of an automated teller terminal in
any of three ways: street address; name of an organization (such as the name of a store); or name
of a readily identifiable location (such as O'Hare
Airport), where the terminal is situated.
In order to facilitate compliance with the documentation provisions of the act and Regulation
E, the Board proposed to delay the effective
dates for other requirements. Comment on the
proposal was requested through March 7, 1980.
2. Preauthorized credits. The act requires that
financial institutions give either positive notice of
1. Title XX of the Financial Institutions Regulatory and Interest Rate Control Act of 1978.
receipt of preauthorized deposits to a consumer's account (such as sending the consumer
notice of receipt of a deposit, for instance, of a
direct electronic deposit of social security benefits) or negative notice (sending a notice that a
scheduled deposit had not been received), unless
the payor has given the consumer notice that the
transfer has been started (such as notice that an
employer has initiated a payroll deposit).
The Board adopted provisions in Regulation E
to implement these requirements. As an alternative, the Board provided, as it had suggested in a
proposal made in April 1979, that institutions
may provide consumers with a telephone number
to be used to verify whether a transfer has or has
not been made. Institutions that adopt this alternative are required to provide readily available
telephone service and to inform the consumer of
the telephone number as an initial disclosure of
terms of the institution's EFT service, and also
on periodic statements to the consumer.
3. Availability of funds. Financial institutions
must make electronically deposited funds available to consumers promptly.
4. Procedures for processing errors. The act—
and Regulation E as adopted—require generally
that financial institutions resolve asserted errors
in electronic fund transfers within 10 business
days of notification by the consumer, either
orally or in writing. Alternatively, institutions
may take up to 45 calendar days to resolve a
complaint, if the account is provisionally recredited within 10 business days for the amount in
dispute. Recrediting need not take place unless
written confirmation of an oral report of error is
received within 10 business days of the oral report by an institution that has advised the consumer that it requires a written report and has
provided an address.
When an institution determines that no error
has been committed, it must notify the consumer
that the account is being debited again for the
amount that was credited. It must honor, for the
period of investigation and for five business days
after mailing of a redebiting notice, checks that
are payable to third parties up to the amount in
dispute.
The institution may limit its investigation to
the "four walls" of the institution, when a third
party—with which the institution has no agree-
Announcements
ment—is involved (including the Social Security
Administration).
5. EFT card issued by a financial institution
not holding the consumer's account. The institution offering the services would be responsible
for compliance, with limited exceptions for disclosures having to do with the relationship of the
institution holding the consumer's account to
that consumer.
The Board's rules for consumer protection under the act and Regulation E, as previously
adopted, include the following, effective May 10,
1980: (a) requirements for disclosures to consumers who use EFT services; (b) exemptions
for transfers of funds within an institution; (c)
record retention ; and (d) the relation of the federal Electronic Fund Transfer Act to state law.
The following previously adopted final rules
are already in effect: (a) limitations on a consumer's liability for unauthorized use of an EFT
card, including: the provision that consumers
cannot be held liable for unauthorized use of EFT
cards if the card issuer has not disclosed what
liability the consumer will have for unauthorized
use of the card, the telephone number and address
for reporting a lost or stolen card, and the institution's business days; and the provision that written notice of loss or theft of an EFT card is effective when the consumer mails or otherwise
transmits the notice to the card issuer and (b)
conditions under which EFT cards may be issued.
CHANGE
IN CHECK COLLECTION
RULES
The Federal Reserve Board announced on January 14, 1980, a change in its check collection
rules to speed up collection of large dollar-value
checks—$250,000 or more—as a means of improving the nation's payments system and of cutting down the amount of Federal Reserve float.
At the same time, and with the same objectives, the Board asked the Federal Reserve
Banks to complete development of a plan first
suggested by the Board last May for presenting
large dollar-value checks for collection electronically, instead of initially presenting them by delivery of the paper checks. This plan could have
the added benefit of conserving fuel used in
check collection.
151
Federal Reserve float—now running at about
$5.5 billion daily, on the average—is the amount
of money that the Federal Reserve has paid to
banks that have sent checks received by them to
the System for collection, but that has not yet
been collected from the banks whose customers
wrote the checks.
To reduce such float, the Board directed the
System's Conference of First Vice Presidents to
develop, as soon as practicable, procedures under which banks sending checks to the Federal
Reserve for collection will sort out all checks of
$250,000 or more. These large checks will be given special handling by the System to speed up
their collection. Checks of this size account for
approximately a quarter of average daily float.
At the same time, the Board also asked the
System's Conference of First Vice Presidents to
complete a plan for the processing of large dollarvalue checks received by the Federal Reserve,
so the necessary information for collection can
be electronically transferred to the banks on
which these checks are drawn and float can be
reduced by speeding up payment.
The Board will consider, and will request
member bank comment on, any proposed electronic check presentment plan.
CONSUMER
ADVISORY
COUNCIL
MEETING
The Federal Reserve Board announced that its
Consumer Advisory Council met on January 28
and 29, 1980.
The Council, whose 30 members are representative of a broad range of consumer and credit
interests, advises the Board on its responsibilities with respect to consumer credit protection
legislation at meetings held generally four times
a year.
The Council's agenda at the January meetings
included the following:
1. Recommendations for changes in laws and
regulations to integrate provisions under the
Truth in Lending and Electronic Fund Transfer
Acts relating to consumer liability and resolution
of errors.
2. Discussion of credit-scoring systems and
how they operate under Regulation B (Equal
Credit Opportunity).
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Federal Reserve Bulletin • February 1980
3. Discussion of the Board's policy and procedures in enforcing the Community Reinvestment
Act.
4. Presentation by the Board's staff on the
1980 legislative outlook.
CHANGE IN BOARD
STAFF
The Board of Governors has announced the following appointment.
Robert C. Plows as Assistant Director, Division of Consumer and Community Affairs, effective January 13, 1980. Mr. Plows was with a
private law firm before joining the Board's staff
in 1976. He holds a B.A. degree from Oberlin
College, an M.A. degree from Yale Divinity
School, and a J.D. degree from George Washington University.
ADDITION
TO PUBLIC TOUR
PROGRAM
The Federal Reserve Board has announced the
addition of a slide show to its public tour pro-
gram. The show explains the role and responsibilities of the Federal Reserve System, the nation's central bank, and highlights architectural
features of the Board Building that are a part of
the guided tour.
S YSTEM
MEMBERSHIP:
ADMISSION OF STATE BANKS
The following banks were admitted to membership in the Federal Reserve System during the
period January 11 through February 10, 1980:
California
Salvang
Colorado
Conifer
Pueblo
Texas
Alief
Wyoming
Aft on
Community Bank of
Santa Ynez Valley
Mountain Valley Bank
Pueblo Boulevard Bank
Alief Alamo Bank
First State Bank at Afton
153
Legal Developments
AMENDMENTS
TO REGULATION
Section 205.7—Initial Disclosure of Terms and
Conditions
E
Effective May 10, 1980, Regulation E, Electronic Fund
Transfers (Part 205) is amended as follows:
1. Section 205.2 is amended by revising the heading,
adding a sentence at the end of paragraph (g), and by
adding paragraph (m), to read as follows:
Section 205.2—Definitions and
Rules of Construction
(g) "Electronic fund transfer" *** The term does
not include payments made by check, draft, or similar
paper instrument at an electronic terminal.
*
*
*
*
*
(m) Footnotes have the same legal effect as the text
of the regulation.
2. Section 205.4 is amended by redesignating paragraph (c) as paragraph (b) and paragraph (d) as paragraph (c).
(a) Content of disclosures. At the time a consumer
contracts for an electronic fund transfer service or before the first electronic fund transfer is made involving
a consumer's account, a financial institution shall disclose to the consumer, in a readily understandable
written statement that the consumer may retain, the
following terms and conditions of the electronic fund
transfer service, as applicable:
5. The final sentence of § 205.8(a) is amended, to read
as follows:
Section 205.8—Change in Terms;
Error Resolution Notice
(a) Change in terms. ***However, if such a change
is to be made permanent, the financial institution shall
provide written notice of the change to the consumer
on or with the next regularly scheduled periodic statement or within 30 days, unless disclosure would jeopardize the security of the system or account.
3. Section 205.5(a) is amended, to read as follows:
Section 205.5—Issuance of Access Devices
(a) General rule. *** (3) As a renewal of, or in substitution for, an access device issued before February
8, 1979 (other than an accepted access device, which
can be renewed or substituted under paragraph (a)(2)
of this section), provided that the disclosures set forth
in §§ 205.7(a)(1), (2), and (3) accompany the renewal or
substitute device; except that for a renewal or substitution that occurs before July 1, 1979, the disclosures may be sent within a reasonable time after the
renewal or substitute device is issued.
4. Section 205.7(a) is amended, to read as follows:
6. Sections 205.9; 205.10(a), and 205.11 are added, to
read as follows:
Section 205.9—Documentation of Transfers
(a) Receipts at electronic terminals. At the time an
electronic fund transfer is initiated at an electronic terminal by a consumer, the financial institution shall
make available2 to the consumer a written receipt of
the transfer(s) that clearly sets forth the following information, as applicable:
(1) The amount of the transfer. A charge for the
transfer may be included in this amount if the terminal
is owned or operated by a person other than the finan-
2. A financial institution may arrange for a third party, such as a
merchant, to make the receipt available.
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Federal Reserve Bulletin • February 1980
cial institution holding the consumer's account, provided the amount of the charge is disclosed on the
receipt and on a sign posted on or at the terminal.
(2) The calendar date the consumer initiated the
transfer.
(3) The type of transfer and the type of the consumer's account(s)3 to or from which funds are transferred, such as "withdrawal from checking," "transfer from savings to checking," or "payment from
savings." These descriptions may be used for transfers to or from accounts that are similar in function to
checking accounts (such as share draft or negotiable
order of withdrawal accounts) or to savings accounts
(such as share accounts). Codes may be used only if
they are explained elsewhere on the receipt.
(4) A number or code that uniquely identifies the
consumer initiating the transfer, the consumer's accounts), or the access device used to initiate the transfer.
(5) The location (in a form prescribed by paragraph
(b)(l)(iv) of this section) of the terminal at which the
transfer was initiated or an identification (such as a
code or terminal number).
(6) The name of any third party to or from whom
funds are transferred; a code may be used only if it is
explained elsewhere on the receipt. This requirement
does not apply if the name is provided by the consumer in a form that the electronic terminal cannot duplicate on the receipt.
(b) Periodic statements. For any account to or from
which electronic fund transfers can be made, the financial institution shall mail or deliver a statement for
each monthly or shorter cycle in which an electronic
fund transfer has occurred, but at least a quarterly
statement if no transfer has occurred. The statement
shall include the following, as applicable:
(1) For each electronic fund transfer occurring during the cycle, 4
(i) The amount of the transfer. If a transfer charge
was added at the time of initiation by the owner or
operator of an electronic terminal in accordance with
paragraph (a)(1) of this section, that charge may be included in the amount of the transfer.
(ii) The date the transfer was credited or debited to
the consumer's account.
(iii) The type of transfer and the type of the consumer's account(s) to or from which funds were transferred.
(iv) For each transfer initiated by the consumer at
an electronic terminal, the location that appeared on
3. If more than one account of the same type may be accessed by a
single access device, the accounts must be uniquely identified.
4. The information required by paragraph (b)(1) of this section may
be provided on accompanying documents. Codes explained on the
statement or on accompanying documents are acceptable.
the receipt or, if an identification (such as a code or
terminal number) was used, that identification and one
of the following descriptions of the terminal's location:
(A) The address, including number and street (the
number may be omitted if the street alone uniquely
identifies the terminal location) or intersection, city,
and state or foreign country;5
(B) A generally accepted name for a specific location (such as a branch of the financial institution, a
shopping Center, or an airport), city, and state or foreign country;6 or
(C) The name of the entity at whose place of business the terminal is located or which owns or operates
the terminal (such as the financial institution7 ot the
seller of goods or services), city, and state or foreign
country.8
(v) The name of any third party to or from whom
funds were transferred.9 If the transfer was initiated by
the consumer at an electronic terminal and a code was
used on the receipt to identify the third party, the
statement shall include the code and the name of the
third party.
(2) The number(s) of the consumer's account(s) for
which the statement is issued.
(3) The total amount of any fees or charges, other
than a finance charge under 12 CFR 226.7(b)(l)(iv), assessed against the account during the statement period
for electronic fund transfers or for the right to make
such transfers.
(4) The balances in the consumer's account(s) at the
beginning and at the close of the statement period.
(5) The address and telephone number to be used for
inquiry or notice of errors, preceded by "Direct Inquiries To:" or similar language. Alternatively, the address and telephone number may be provided on the
notice of error resolution procedures set forth in
§ 205.8(b).
(6) If the financial institution uses the notice procedure set forth in § 205.10(a)(l)(iii), the telephone number the consumer may call to ascertain whether a preauthorized transfer to the consumer's account has
occurred.
5. The city and state may be omitted if all the terminals owned or
operated by the financial institution providing the statement (or by the
system in which it participates) are located in the same city. The state
may be omitted if all the terminals owned or operated by the financial
institution providing the statement (or by the system in which it participates) are located in that state.
6. See footnote 5.
7. If the financial institution providing the statement owns or operates terminals at more than one location, it shall describe the location
of its electronic terminals by use of paragraphs (b)(l)(iv)(A) or (B) of
this section.
8. See footnote 5.
9. A financial institution need not identify third parties whose
names appear on checks, drafts, or similar paper instruments deposited to the consumer's account at an electronic terminal.
Legal Developments
(c) Documentation for certain passbook accounts.
In the case of a consumer's passbook account which
may not be accessed by any electronic fund transfers
other than preauthorized transfers to the account, the
financial institution may, in lieu of complying with
paragraph (b) of this section, upon presentation of the
consumer's passbook, provide the consumer with documentation by entering in the passbook or on a separate document the amount and date of each electronic
fund transfer made since the passbook was last presented.
(d) Periodic statements for certain non-passbook
accounts. If a consumer's account other than a passbook account may not be accessed by any electronic
fund transfers other than preauthorized transfers to
the account, the financial institution need provide the
periodic statement required by paragraph (b) of this
section only quarterly.
(e) Use of abbreviations. A financial institution may
use commonly accepted or readily understandable abbreviations in complying with the documentation requirements of this section.
Section 205.10—Preauthorized Transfers
(a) Preauthorized transfers to a consumer's account. (1) Where a consumer's account is scheduled to
be credited by a preauthorized electronic fund transfer
from the same payor at least once every 60 days,
except where the payor provides positive notice to the
consumer that the transfer has been initiated, the
financial institution shall provide notice by one of the
following means:
(1) The institution shall transmit oral or written notice to the consumer, within 2 business days after the
transfer, that the transfer occurred;
(ii) The institution shall transmit oral or written notice to the consumer, within 2 business days after the
date on which the transfer was scheduled to occur,
that the transfer did not occur; or
(iii) The institution shall provide a readily available
telephone line that the consumer may call to ascertain
whether or not the transfer occurred, and shall disclose the telephone number on the initial disclosures
required by § 205.7 and on each periodic statement.
(2) A financial institution that receives a preauthorized transfer of the type described in paragraph
(a)(1) of this section shall credit the amount of the
transfer as of the day the funds for the transfer are
received.
155
Section 205.11—Procedures for Resolving
Errors
(a) Definition of error. For purposes of this section,
the term "error" means:
(1) An unauthorized electronic fund transfer;
(2) An incorrect electronic fund transfer to or from
the consumer's account;
(3) The omission from a periodic statement of an
electronic fund transfer to or from the consumer's account that should have been included;
(4) A computational or bookkeeping error made by
the financial institution relating to an electronic fund
transfer;
(5) The consumer's receipt of an incorrect amount
of money from an electronic terminal;
(6) An electronic fund transfer not identified in
accordance with the requirements of §§ 205.9 or
205.10(a); or
(7) A consumer's request for any documentation required by §§ 205.9 or 205.10(a), or for additional information or clarification concerning an electronic fund
transfer. This includes any request for documentation,
information, or clarification in order to assert an error
within the meaning of paragraphs (a)(1) through (6) of
this section. It does not include a routine inquiry about
the balance in the consumer's account or a request for
duplicate copies of documentation or other information that is made only for tax or other record-keeping
purposes.
(b) Notice of error from consumer. (1) A notice of
an error is an oral or written notice from the consumer
that
(i) Is received by the financial institution10 no later
than 60 days after the institution
(A) Transmitted a periodic statement or provided
documentation under § 205.9(c) on which the alleged
error is first reflected; or
(B) Transmitted additional information, clarification, or documentation described in paragraph
(a)(7) of this section that was initially requested in accordance with paragraph (b)(l)(i)(A) of this section;
(ii) Enables the financial institution to identify the
consumer's name and account number; and
(iii) Except for errors described in paragraph (a)(7)
of this section, indicates the consumer's belief, and the
reasons for that belief, that an error exists in the consumer's account or is reflected on documentation required by §§ 205.9 or 205.10(a), and indicates to the
10. A financial institution may require the consumer to give notice
only at the telephone number or address disclosed by the institution,
provided the institution maintains reasonable procedures to refer the
consumer to the specified telephone number or address if the consumer attempts to give notice to the institution in a different manner.
A 156
Federal Reserve Bulletin • February 1980
extent possible the type, the date, and the amount of
the error.
(2) A financial institution may require a written confirmation to be received within 10 business days of an
oral notice if, when the oral notice is given, the consumer is advised of the requirement and of the address
to which confirmation must be sent.
(c) Investigation of errors. (1) After receiving a notice of an error, the financial institution shall promptly
investigate the alleged error, determine whether an
error occurred, and transmit the results of its investigation and determination to the consumer within 10 business days.
(2) As an alternative to the 10-business-day requirement of paragraph (c)(1) of this section, the financial
institution shall investigate the alleged error and determine whether an error occurred, promptly but in no
event later than 45 calendar days after receiving a notice of an error, and shall transmit the results of its
investigation and determination to the consumer, provided
(i) The financial institution provisionally recredits
the consumer's account in the amount of the alleged
error (including interest where applicable) within 10
business days after receiving the notice of error. If the
financial institution has a reasonable basis for believing that an unauthorized electronic fund transfer may
have occurred and that it has satisfied the requirements of § 205.6(a), it may withhold a maximum of $50
from the amount recredited;
(ii) The financial institution, promptly but no later
than 2 business days after the provisional recrediting,
orally reports or mails or delivers notice to the consumer of the amount and date of the recrediting and of
the fact that the consumer will have full use of the
funds pending the determination of whether an error
occurred;
(iii) The financial institution gives the consumer full
use of the funds provisionally recredited during the investigation; and
(iv) If the financial institution determines that no
error occurred and debits the account, the institution
gives notice of the debiting and continues to honor certain items as required by paragraph (f)(2) of this section.
(3) A financial institution that requires but does not
receive timely written confirmation of oral notice of an
error shall comply with all requirements of this section
except that it need not provisionally recredit the consumer's account.
(d) Extent of required investigation. (1) A financial
institution complies with its duty to investigate, correct, and report its determination regarding an error
described in paragraph (a)(7) of this section by trans
mitting the requested information, clarification, or
documentation within the time limits set forth in paragraph (c) of this section. If the institution has provisionally recredited the consumer's account in accordance with paragraph (c)(2) of this section, it may debit
the amount upon transmitting the requested information, clarification, or documentation.
(2) Except in the case of services covered by
§ 205.14, a financial institution's review of its own records regarding an alleged error will satisfy its investigation responsibilities under paragraph (c) of this section if the alleged error concerns a transfer to or from a
third party and there is no agreement between the financial institution and the third party11 regarding the
type of electronic fund transfer alleged in the error.
(3) A financial institution may make, without investigation, a final correction to a consumer's account in
the amount or manner alleged by the consumer to be in
error, but must comply with all other applicable requirements of this section.
(e) Procedures after financial institution determines
that error occurred. If the financial institution determines that an error occurred, it shall
(1) Promptly, but no later than 1 business day after
its determination, correct the error (subject to the liability provisions of §§ 205.6(a) and (b)), including,
where applicable, the crediting of interest and the refunding of any fees or charges imposed, and
(2) Promptly, but in any event within the 10-business-day or 45-day time limits, orally report or mail or
deliver to the consumer notice of the correction and, if
applicable, notice that a provisional credit has been
made final.12
(f) Procedures after financial institution determines
that no error occurred. If the financial institution determines that no error occurred or that an error occurred in a different manner or amount from that described by the consumer,
(1) The financial institution shall mail or deliver to
the consumer a written explanation of its findings within 3 business days after concluding its investigation,
but in no event later than 10 business days after receiv-
11. Institutions do not have an agreement for purposes of paragraph
(d)(2) of this section solely because they participate in transactions
under the federal recurring payments program, or that are cleared
through an automated or other clearing house or similar arrangement
for the clearing and settlement of fund transfers generally, or because
they agree to be bound by the rules of such arrangements. An agreement that a third party will honor an access device is an agreement for
purposes of this paragraphy.
12. This notice requirement may be satisfied by a notice on a periodic statement that is mailed or delivered within the 10-business-day
or 45-day time limits and that clearly identifies the correction to the
consumer's account.
Legal Developments
ing notice of the error if the institution is proceeding
under paragraph (c)(1) of this section. The explanation
shall include notice of the consumer's right to request
the documents upon which the institution relied in
making its determination.
(2) Upon debiting a provisionally recredited
amount, the financial institution
(i) Shall orally report or mail or deliver notice to the
consumer of the date and amount of the debiting and
the fact that the financial institution will honor checks,
drafts, or similar paper instruments payable to third
parties and preauthorized transfers from the consumer's account (using the provisionally recredited
funds) for 5 business days after transmittal of the notice.
(ii) Shall honor checks, drafts, or similar paper instruments payable to third parties and preauthorized
transfers from the consumer's account (without charge
to the consumer as a result of an overdraft) for 5 business days after transmittal of the notice. The institution need only honor items that it would have paid if
the provisionally recredited funds had not been debited.
(3) Upon the consumer's request, the financial institution shall promptly mail or deliver to the consumer
copies of the documents on which it relied in making
its determination.
(g) Withdrawal of notice of error. The financial institution has no further error resolution responsibilities
as to a consumer's assertion of an error if the consumer concludes that no error did in fact occur and
voluntarily withdraws the notice.
(h) Reassertion of error. A financial institution that
has fully complied with the requirements of this section with respect to an error has no further responsibilities under this section if the consumer subsequently
reasserts the same error, regardless of the manner in
which it is reasserted. This paragraph does not preclude the assertion of an error defined in paragraphs
(a)(1) through (6) of this section following the assertion
of an error described in paragraph (a)(7) of this section
regarding the same electronic fund transfer.
(i) Relation to Truth in Lending. Where an electronic fund transfer also involves an extension of credit
under an agreement between a consumer and a financial institution to extend credit when the consumer's
account is overdrawn or to maintain a specified minimum balance in the consumer's account, the financial
institution shall comply with the requirements of this
section rather than those of 12 CFR 226.2(j), 226.2(cc),
and 226.14(a) governing error resolution.
7. Section 205.13 is amended, to read as follows:
157
Section 205.13—Administrative Enforcement
(b) Issuance of staff
interpretations.
(2)(i)***Any request for an official staff interpretation of this regulation shall be made in writing and
addressed to the Director of the Division of Consumer
and Community Affairs, Board of Governors of the
Federal Reserve System, Washington, D.C. 20551.
*
*
*
*
*
(4) Pursuant to § 915(d) of the Act, the Board has
designated the Director and other officials of the Division of Consumer and Community Affairs as officials
"duly authorized" to issue, at their discretion, official
staff interpretations of this regulation.
(c) Record retention.
(2) Any person subject to the Act and this regulation that has actual notice that it is being investigated
or is subject to an enforcement proceeding by an agency charged with monitoring that person's compliance
with the Act and this regulation, or that has been
served with notice of an action filed under §§ 910, 915,
or 916(a) of the Act, shall retain the information required in paragraph (c)(1) of this section that pertains
to the action or proceeding until final disposition of the
matter, unless an earlier time is allowed by order of the
agency or court.
8. Section 205.14 is added, to read as follows:
Section 205.14—Services Offered by Financial
Institutions Not Holding Consumer's Account
(a) Compliance by service-providing
institution.
Except as provided in this section, where a financial
institution issues an access device to a consumer to be
used for initiating electronic fund transfers to or from
the consumer's account held by another financial institution, and the service-providing institution does not
have an agreement with the account-holding institution regarding the service, the service-providing institution shall comply with all requirements of the Act
and this regulation that relate to the service or the electronic fund transfers made by the consumer under the
A 158
Federal Reserve Bulletin • February 1980
service. For this purpose, the following special rules
shall apply:
(1) Section 205.6 shall require the service-providing
institution to reimburse the consumer for unauthorized
electronic fund transfers in excess of the limits set by
that section.
(2) Sections 205.7, 205.8, and 205.9 shall require the
service-providing institution to provide those disclosures and documentation that are within its knowledge and the purview of its relationship with the consumer.
(3) Section 205.1 l(b)(l)(i) shall require the serviceproviding institution to extend by a reasonable time
the time periods within which notice of an error must
be received if a delay in notifying the service-providing
institution was due to the fact that the consumer initially notified or attempted to notify the accountholding institution.
(4) Sections 205.1 l(c)(2)(i) and (e)(1) shall require
the service-providing institution to transfer funds, in
the appropriate amount and within the applicable time
period, to the consumer's account at the account-holding institution.
(5) Section 205.1 l(c)(2)(ii) shall require the serviceproviding institution to disclose the date on which it
initiates a transfer to effect the provisional recredit.
(6) Section 205.11(f)(2) shall require the serviceproviding institution to notify the account-holding institution of the date until which the account-holding
institution must honor any debit to the account as required by § 205.11(f)(2). If an overdraft results, the
service-providing institution shall promptly reimburse
the account-holding institution in the amount of the
overdraft.
tion of the service) which sets forth the rights and obligations of the institutions with respect to a service
involving the issuance of an access device to the consumer. Institutions do not have such an agreement
solely because they participate in transactions that are
cleared through an automated or other clearing house
or similar arrangement for the clearing and settlement
of fund transfers generally, or because they agree to be
bound by the rules of such an arrangement.
9. Appendix A is amended by deleting the material enclosed in parentheses in each section caption, and substituting therefor the following: in § A(l), tk§
205.5(b)(3)"; in § A(2), "§ 205.7(a)(1)"; in § A(3),
kt
§ 205.7(a)(2)"; in § A(4), tk§ 205.7(a)(3)"; in
"§ A(5), 205.7(a)(4)"; in § A(6), "§ 205.7(a)(5)"; in § A(7),
§ 205.7(a)(9)"; in § A(8), "§ 205.7(a)(6)"; in § A(9),
205.7(a)(6),(7), and (8)"; and in § A(10), "§
205.7(a)(8)".
10. Appendix A is further amended by adding § A(8)(b)
and by revising § A(10)(a), to read as follows:
Appendix A—Model Disclosure Clauses
Section A(8)—Disclosure of Right To Receive
Documentation of Transfers (§ 205.7(a)(6))
(b) Preauthorized credits. If you have arranged to
(b) Compliance by account-holding institution. An
account-holding institution described in paragraph (a)
of this section need not comply with the requirements
of the Act and this regulation with respect to electronic
fund transfers to or from the consumer's account made
by the service-providing institution, except that the account-holding institution shall comply with § 205.11 by
(1) Promptly providing, upon the request of the
service-providing institution, information or copies of
documents required for the purpose of investigating alleged errors or furnishing copies of documents to the
consumer; and
(2) Honoring debits to the account in accordance
with § 205.11(f)(2).
(c) Definition of agreement. For purposes of this
section, an agreement between the service-providing
and the account-holding institutions regarding the
electronic fund transfer service refers to a specific
agreement (s) among institutions (or among institutions and another person that participates in the opera
have direct deposits made to your account at least
once every 60 days from the same person or company,
(we will let you know if the deposit is [not] made.)
(the person or company making the deposit will tell
you every time they send us the money.)
(you can call us at [insert telephone number] to find
out whether or not the deposit has been made.)
Section A(10)—Disclosure of Financial Institution's Liability for Failure to Make Transfers (§
205.7(a)(8))
(a) Liability for failure to make transfers. If we do
not complete a transfer to or from your account on
time or in the correct amount according to our agree-
Legal Developments
ment with you, we will be liable for your losses or
damages. However, there are some exceptions. We
will not be liable, for instance:
—If, through no fault of ours, you do not have
enough money in your account to make the transfer.
—If the transfer would go over the credit limit on
your overdraft line.
—If the automated teller machine where you are
making the transfer does not have enough cash.
—If the (terminal)(system) was not working properly and you knew about the breakdown when you
started the transfer.
—If circumstances beyond our control (such as fire
or flood) prevent the transfer, despite reasonable precautions that we have taken.
—There may be other exceptions stated in our
agreement with you.
*
*
*
*
*
BANK HOLDING COMPANY AND
BANK MERGER ORDERS ISSUED BY THE
BOARD OF GOVERNORS
Orders Under Section 3, of
Bank Holding Company Act
American National Sidney Corp.,
Sidney, Nebraska
Order Denying
Formation of Bank Holding
Company
American National Sidney Corp., Sidney, Nebraska,
has applied for the Board's approval under section
3(a)(1) of the Bank Holding Company Act (12 U.S.C. §
1842(a)(1)) of formation of a bank holding company by
acquiring 100 percent, less directors' qualifying
shares, of the voting shares of American National
Bank of Sidney ("Bank"), Sidney, Nebraska.
Notice of the application affording opportunity for
interested persons to submit comments and views, has
been given in accordance with section 3(b) of the Act.
The time for filing comments and views 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 Act (12 U.S.C. § 1842(c)).
Applicant is a nonoperating corporation formed for
the purpose of becoming a bank holding company by
acquiring Bank, which holds deposits of $25.8 million.1 Upon acquisition of Bank, Applicant would con-
1. All banking data are as of June 30, 1978.
159
trol the 55th largest of 452 banks in Nebraska and
would hold approximately 0.34 percent of the total deposits of commercial banks in the state.
Bank is the largest of five banks in the relevant
banking market and holds 48.8 percent of the total deposits in commercial banks in the market.2 While two
of Applicant's principals are associated with two other
one-bank holding companies and their subsidiary
banks, those organizations, located in Lincoln, Nebraska, and Des Moines, Iowa, operate in separate
banking markets from Bank. It appears that consummation of the proposal would not eliminate competition or increase the concentration of banking resources in any relevant area. Accordingly, the Board
concludes that competitive considerations are consistent with approval of the application.
The Board has indicated on previous occasions that
a holding company should serve as a source of financial and managerial strength to its subsidiary bank, and
that the Board will closely examine the condition of an
applicant in each case with this consideration in mind.3
Furthermore, where principals of an applicant are engaged in operating a chain of banking organizations,
the Board, in addition to analyzing the one-bank holding company proposal before it, also considers the total chain and analyzes the financial and managerial resources and future prospects of the chain within the
context of the Board's multi-bank holding company
standards. Having examined such factors in light of
the record in this application, the Board concludes that
the record presents adverse considerations as they relate to the applicant company that warrant denial of its
proposed acquisition of Bank.
As stated, Applicant's officers and principal shareholders are also officers and principal shareholders of
two other one-bank holding companies. The operations of both bank holding companies have fallen short
of those expected by the Board and projected by those
companies in their application to become bank holding
companies. From the record, it appears that these results are due in major part to certain management policies and practices of Applicant's principals. The operating history and overall condition of each of these
bank holding companies do not support a finding that
Applicant's principals have demonstrated a history of
satisfactory managerial performance that would warrant a favorable finding by the Board at this time with
2. The relevant banking market is approximated by Cheyenne
County.
3. The Bank Holding Company Act requires that before an organization is permitted to become a bank holding company and thus obtain
the benefits associated with the holding company structure, it must
secure the Board's approval. Section 3(c) of the Act provides that the
Board must, in every case, consider, among other things, the financial
and managerial resources of both the applicant company and the bank
to be acquired. The Board's action in this case is based on a consideration of such factors.
A 160
Federal Reserve Bulletin • February 1980
respect to Applicant's managerial resources and future
prospects.4
With respect to Applicant's and Bank's financial resources the Board notes that Applicant would incur a
sizable debt in connection with the proposed acquisition of Bank's shares. Although Applicant's final retirement of subordinated debentures issued in connection with this acquisition is scheduled to take place
in the twentieth year following consummation, earnings prospects for Bank based upon Bank's historical
performance appear to provide Applicant with sufficient financial flexibility to retire the entire acquisition debt in 12 years while maintaining adequate capital in Bank. However, in light of the records of the
other two bank holding companies in meeting their
projections, the Board believes that Applicant's projections in this case appear somewhat optimistic. Accordingly, the Board is of the view that the considerations relating to financial and managerial resources
and future prospects are so adverse as to warrant denial of this application.
No significant changes in Bank's operations or in the
services offered to customers are anticipated to follow
from consummation the proposed acquisition. Consequently, convenience and need factors lend no
weight towards approval of this application.
On the basis of the circumstances concerning this
application, the Board concludes that the banking considerations involved in this proposal present adverse
factors bearing upon financial and managerial resources and future prospects of Applicant and Bank.
Such adverse factors are not outweighed by any procompetitive effects or by benefits that would result in
better serving the convenience and needs of the community. Accordingly, it is the Board's judgment that
approval of the application would not be in the public
interest and the application should be denied.
On the basis of the facts of record, the application is
denied for the reason summarized above.
By order of the Board of Governors, effective January 25, 1980.
Voting for this action: Chairman Volcker and Governors
Schultz, Wallich, Coldwell, Partee, and Rice. Absent and not
voting: Governor Teeters.
[SEAL]
(Signed) G R I F F I T H L . G A R W O O D ,
Deputy Secretary of the Board.
4. The Board has previously stated that it believes that it is reasonable to expect an applicant to demonstrate a record of satisfactory
managerial performance. See e.g., Chickasha Bancshares, Inc., 63
FEDERAL RESERVE BULLETIN 1082 ( 1 9 7 7 ) .
Childress Bancshares, Inc.,
Childress, Texas
Order Denying
Formation of Bank Holding Company
Childress Bancshares, Inc., Childress, Texas, has applied for the Board's approval under section 3(a)(1) of
the Bank Holding Company Act (12 U.S.C. §
1842(a)(1)) of formation of a bank holding company by
acquiring 95 percent or more of the voting shares of
The First National Bank in Childress, Childress, Texas ("Bank").
Notice of the application, affording opportunity for
interested persons to submit comments and views, has
been given in accordance with section 3(b) of the Act.
The time for filing comments and views 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 Act (12 U.S.C § 1842(c)).
Applicant, a nonoperating company with no subsidiaries, was organized for the purpose of becoming a
bank holding company through the acquisition of
Bank. Bank ($13.7 million in deposits) is one of the
smaller banks in Texas, holding less than 0.1 percent
of the total deposits in commercial banks in the state.1
Bank is the larger of the two banks located in the
Childress County banking market and holds 66.7 percent of the market's total commercial bank deposits.2
This proposal involves a restructuring of Bank's ownership from an individual to a corporation owned by
the same individual. Applicant neither engages in any
activity directly nor holds shares of any other bank. In
analyzing the competitive effects of this proposal
it is necessary to consider that when Applicant's
principal purchased controlling interest in Bank in
March 1979, he also purchased controlling interest in
Farmers and Mechanics Trust Company, Childress,
Texas ("F&M"), a registered bank holding company
controlling First State Bank, Childress, Texas ("First
State Bank"), the only other bank located in the relevant banking market. First State Bank ($6.8 million in
deposits) is the second bank in the relevant market and
holds 33.3 percent of the market's commercial bank
deposits. The purchase of control of Bank and F&M
by Applicant's principal occurred only two days before the effective date of the Change in Bank Control
Act of 1978 (12 U.S.C. § 1817(j)), and thus escaped
scrutiny under that Act. The Change in Bank Control
Act requires individuals to notify the appropriate Federal banking regulatory agency prior to acquiring con1. Unless otherwise indicated, all banking data are as of December
31, 1978, and reflect bank holding company formations and acquisitions approved as of November 30, 1979.
2. The relevant banking market is approximated by Childress
County, Texas.
Legal Developments
trolling interest in a bank or bank holding company in
order that the agency may review, inter alia, the competitive consequences of the acquisition and disapprove any acquisition that does not meet the standards of that Act.
The facts of record indicate that Bank and First
State Bank have been affiliated for a long period of
time and the nature of this relationship was such that
little, if any, meaningful competition existed between
Bank and First State Bank when Applicant's principal
purchased control of Bank and F&M in March 1979.
However, the sale of control of Bank and F&M in 1979
presented an opportunity to sever this relationship and
introduce competition into the relevant banking market.
Section 3(c) of the Bank Holding Company Act precludes the Board from approving any acquisition by a
bank holding company that (1) would result in a monopoly or be in a furtherance of any combination to
monopolize or attempt to monopolize a banking market, or that (2) may substantially lessen competition or
tend to create a monopoly or be in restraint of trade in
any banking market, unless the Board finds that the
anticompetitive effects are clearly outweighed by the
convenience and needs of the community to be served.
In the Board's view, the subject proposal presents a
compelling case where the holding company form is
being used to further an anti-competitive arrangement.
Acquisition of control of Bank and F&M by Applicant's principal resulted in his controlling all the commercial banking deposits in the relevant banking market and was clearly anticompetitive in its inception, a
factor the Board has regarded as significant and relevant to a consideration of the competitive aspects of
an acquisition.3 In addition, Applicant's principal controls, either directly or indirectly, two other banks located in banking markets which are adjacent to the
Childress banking market. In light of all the facts of
record, the market shares of the organizations involved and their collective position in the relevant
market (Bank and First State Bank are the only commercial banking alternatives in the market), the Board
is of the opinion that the application should be denied
since approval of this proposal would serve to perpetuate a substantially adverse competitive situation in the
relevant banking market.4
The subject proposal presents a situation where the
holding company form is being used to further an anticompetitive arrangement. While denial of this pro-
3. See the Board's Order of May 11, 1977, denying an application
by Mahaska Investment Company, Oskaloosa, Iowa (63 FEDERAL RESERVE BULLETIN 579 (1977)); and the Board's Order of November 18,
1977, denying an application by Citizens Bancorp, Inc., Hartford City,
I n d i a n a (63 FEDERAL RESERVE BULLETIN 1083 (1977)).
4. In this regard, the Board notes that in Board of Governors of the
Federal Reserve System v. First Lincolnwood Corp., 439 U.S. 234
161
posal may not immediately result in a complete termination of the anticompetitive situation, it would
preserve the distinct possibility that Bank could again
become an independent and competing organization in
the future. Alternatively, approval would solidify and
strengthen the common ownership of the two banks
and would diminish the possibility of disaffiliation in
the future.
On the basis of the foregoing and the facts of record,
the Board concludes that approval of the application
would have significant adverse competitive effects.
Accordingly, under the standards set forth in the Bank
Holding Company Act, the proposal may not be approved unless the adverse competitive factors are
clearly outweighed by other public interest considerations reflected in the record. In this case, the Board
finds that the adverse competitive aspects are not outweighed.
Where principals of an applicant are engaged in operating a chain of banking organizations, the Board, in
addition to analyzing the one-bank holding company
proposal before it, also considers the total chain and
analyzes the financial and managerial resources and
future prospects of the chain within the context of the
Board's multibank holding company standards. Based
upon such analysis in this case, the managerial resources and future prospects of Applicant and Bank
appear to be satisfactory. Therefore, considerations
relating to banking factors are consistent with approval of the subject application. No significant changes in
the services offered by Bank are expected to result
from consummation of the proposed acquisition.
Thus, convenience and needs factors are consistent
with, but lend no weight toward, approval. In light of
the above, it is the Board's judgment that approval of
this application would not be in the public interest and
that the application should be denied.
On the basis of the facts of record, and in light of the
factors set forth in section 3(c) of the Act, it is the
Board's judgment that consummation of the proposal
to form a bank holding company would not be in the
public interest and that the application should be and
hereby is denied for the reasons summarized herein.
By order of the Board of Governors, effective January 28, 1980.
(1978), the Supreme Court upheld the Board's authority to deny approval for formation of a one-bank holding company on the basis of
preexisting, unfavorable aspects even though the formation will neither cause nor enhance the already existing adverse aspects. Thus, the
Board may deny approval due to conditions that predate the proposed
holding company formation. Although the First Lincolnwood case involved adverse financial factors, the rationale of the Board's authority
to deny a bank holding company formation is equally applicable to an
anticompetitive arrangement, especially in light of the Act's strong
emphasis against anticompetitive combinations.
A 162
Federal Reserve Bulletin • February 1980
Voting for this action: Chairman Volcker and Governors
Schultz, Wallich, Partee, and Rice. Absent and not voting:
Governors Coldwell and Teeters.
[SEAL]
(Signed) G R I F F I T H L. G A R W O O D ,
Deputy Secretary of the Board.
First National Boston Corporation,
Boston, Massachusetts
Order Approving Acquisition of a Bank
First National Boston Corporation, Boston, Massachusetts, a bank holding company within the meaning
of the Bank Holding Company Act of 1956 (the
"Act"), has applied for the Board's approval under
section 3 of the Act (12 U.S.C. §1842) to indirectly acquire1 100 percent (less directors' qualifying shares) of
the shares of Southeastern Bank and Trust Company
("Bank"), New Bedford, Massachusetts.
Notice of the applications, affording an opportunity
for interested persons to submit comments and views,
has been given in accordance with section 3(b) of the
Act. The time for filing comments and views has expired and the Board has considered the applications
and all comments received, including those of The
First National Bank of New Bedford, New Bedford,
Massachusetts ("Protestant"), in light of the factors
set forth in section 3(c) of the Act.
In addition to interposing numerous objections to
the proposed acquisition, Protestant has requested
that the Board order a formal hearing to air the issues
raised by Protestant's objections. Section 3(b) of the
Act requires that the Board hold a formal hearing concerning an application only where the appropriate
state banking authority makes a timely written recommendation of denial of the application, and no such
recommendation has been received from the Massachusetts Commissioner of Banks with respect to Applicant's proposal.2 While no formal hearing is re1. Applicant has applied under section 3(a)(1) of the Act (12 U.S.C.
§ 1842(a)(1)) for approval to merge its wholly-owned inactive subsidiary, First of Boston Bristol Corporation ("First Bristol"), with Bank's
parent holding company, Southeastern Bancorp. Inc., New Bedford,
Massachusetts, thereby causing First Bristol to become a bank holding company. At the same time, Applicant has applied under section
3(a)(3) (12 U.S.C. § 1842(a)(3)) for approval to indirectly acquire Bank
at the time First Bristol merges with Southeastern Bancorp, Inc. Applicant has also applied under section 3(a)(5) of the Act (12 U.S.C. §
1842(a)(5)) for approval to merge with First Bristol, following consummation of the prior transactions. Both First Bristol and Southeastern
Bancorp. Inc. have no significance except as a means to facilitate the
acquisition of voting shares of Bank by Applicant. Accordingly, all of
the above-described transactions are treated together herein as one
application for the acquisition of shares of Bank.
2. Protestant contends that a dissenting vote by one member of the
Massachusetts Board of Bank Incorporation on an application for
state approval of the proposal triggered the hearing requirement of
quired in this instance, the Board could in its
discretion order a formal or informal proceeding concerning the application if it determines that there are
material questions of facts in dispute that can only be
resolved by means of such a proceeding. Accordingly,
the Board has scrutinized the record in this application, and has determined that there are no material
factual differences that would necessitate a hearing on
this application.3 Rather, Protestant submits arguments concerning the interpretation or significance
that should be accorded to certain facts in the record.
Inasmuch as the Board itself is charged by statute with
making these judgments, and in view of the fact that all
parties have been afforded ample opportunity to present their arguments in written submissions to the record in this application, the Board has denied Protestant's request for a formal hearing. Accordingly, the
Board will proceed to consider the application, as well
as Protestant's objections to the proposal, on their
merits.
Applicant, the largest commercial banking organization in Massachusetts, controls seven subsidiary
banks with aggregate domestic deposits of $3.51 billion, representing 21.3 percent of total deposits held in
commercial banks in the state. 4 Bank, with deposits of
$45.4 million, is the 178th largest commercial bank in
the state. While banking resources in Massachusetts
are somewhat concentrated among several large organizations, including Applicant, in this case the addition of 0.28 percent of state-wide deposits held by
Bank would represent only a nominal increase of the
share of deposits controlled by Applicant in the state.
Accordingly, consummation of the proposal would not
have an appreciable effect upon the concentration of
banking resources in Massachusetts.
Bank, with four banking offices, is the third largest
of eight commercial banks in the New Bedford banking market,5 and holds 19.7 percent of commercial
bank deposits in the market. While Applicant's subsidiary banks have 75 branches in seven Massachusetts
section 3(b). The Board finds this contention to be without merit since
section 3(b) provides that a specific written recommendation be submitted by the state authority to the Board. In any event, the order of
which the dissenting vote was a part was overturned by the Massachusetts courts, and in a subsequent ruling the application was unanimously approved by the Massachusetts Board.
3. In this connection, the Board notes that Protestant and Applicant
have had ample opportunity to resolve any factual discrepancies on
three occasions in hearings held before Massachusetts banking authorities concerning the proposed acquisition. A complete transcript
of the most recent hearing, including submissions by the parties, has
been made a part of the record in this application.
4. All banking data are as of September 30, 1978.
5. The New Bedford banking market is approximated by the city of
New Bedford and six surrounding towns, including Dartmouth, Freetown, Acushnet, and Fairhaven in Bristol County, and Mattapoisett
and Marion in Plymouth County. Protestant contends that the relevant
banking market for the proposal is the New Bedford SMSA. While not
identical, the market defined herein is substantially equivalent to the
New Bedford SMSA.
Legal Developments
counties, none of those offices are located in the New
Bedford banking market. Protestant contends that the
proposed acquisition of Bank by Applicant will eliminate a significant amount of direct competition in the
New Bedford market since Applicant's lead subsidiary
bank, First National Bank of Boston ("FNBB"), derives approximately $20.2 million in loans and $6.7
million in deposits from the New Bedford area. However, from the record it appears that FNBB's New
Bedford loans are large commercial loans of which a
large portion are made to several sizeable firms. Similarly, a large portion of the deposit accounts are accounts of $100,000 or more, and are related to loans.
Inasmuch as FNBB has no banking offices to serve the
individual or small business customer in the New Bedford banking market, and in view of the fact that business derived from that market by FNBB is attributable
to large commercial customers, the Board does not regard FNBB as a competitor in the local New Bedford
market. Accordingly, the Board concludes that consummation of the proposal would not result in the
elimination of existing competition in the New Bedford banking market.
With respect to potential competition, the Board
notes that Applicant has the resources to enter the
market de novo. However, with a relatively low per
capita income and high unemployment rate, the New
Bedford market is not considered attractive for de
novo entry at this time. Moreover, Massachusetts
places restrictions on branching across county lines,
and none of Applicant's subsidiary banks is authorized
to branch into the New Bedford market. Therefore,
consummation of the acquisition would have no serious adverse effects on potential competition.
The financial and managerial resources of Applicant
and its subsidiary banks are considered generally satisfactory and the future prospects for each appear favorable. Upon consummation of the acquisition of Bank
by Applicant, the financial resources of Bank may be
regarded as adequate and its future prospects favorable, particularly in light of Applicant's commitment
to provide additional capital to Bank. In addition, affiliation of Bank with Applicant will provide Bank with
access to Applicant's managerial resources and particularly managerial expertise in the areas of loan portfolio review, automated accounting and internal auditing
and budget controls. Thus, the Board concludes that
banking factors lend some weight toward approval of
the application.
In considering the effects of the proposed acquisition on the convenience and needs of the community
to be served, the Board has examined the Applicant's
record of performance in meeting the credit needs of
its community as provided in the Community Reinvestment Act (12 U.S.C. § 2901) ("CRA") and the
Board's Regulation BB (12 CFR § 228) issued there
163
under. In so doing, the Board has scrutinized the objections of Protestant concerning Applicant's record of
performance with respect to CRA factors. In this regard, Protestant alleges that Applicant's efforts to ascertain local credit needs are inadequate; that Applicant has disregarded community needs by closing
branches in low- and moderate-income neighborhoods; that Applicant does not meet local credit needs
as evidenced by the small percentage of its total loans
represented by mortgage loans within its defined community; that Applicant's participation in community
development programs is insignificant in comparison
with its resources; and that Applicant engages in community disinvestment by requiring its smaller subsidiary banks to join in loan participations with FNBB.
Protestant has submitted information regarding each
of these allegations including information developed in
extended proceedings at the State level. Furthermore,
the proposed acquisition has been the subject of public
hearings before the Massachusetts Board during which
Protestant presented information concerning its allegations. Upon submission of the record of the latest proceeding to the Board, Applicant was requested to respond to Protestant's allegations concerning
Applicant's record of performance and made several
subsequent submissions for the record. The Board has
examined the submissions of Protestant and Applicant
regarding the issues raised by Protestant. Inasmuch as
Protestant's objections focus primarily on the CRA
performance of FNBB, the Board has also considered
the conclusions reached by the Office of the Comptroller of the Currency resulting from an examination of
FNBB that included an assessment of FNBB's record
in meeting the requirements of the CRA. At the outset,
the Board notes that no procedural violations by
FNBB of CRA requirements were found. Accordingly, on the basis of its review of the entire record,
the Board makes the following findings concerning
Protestant's allegations.
With respect to Applicant's efforts to ascertain and
meet the credit needs of its community, it appears
from the record that FNBB has taken a number of
steps to communicate more effectively with local community groups in an effort to ascertain the credit needs
of the local community.6 Specifically, FNBB has established a community investment department whose
purpose is to develop an effective community contact
program and to coordinate and supervise CRA compliance. In addition, FNBB's Board of Directors has
established a committee composed of those Board
members with responsibility for developing policies
relating to the CRA and evaluating the implementation
6. FNBB's definition of its community as encompassing all of Suffolk County appears to be reasonable, does not exclude any low- to
moderate-income neighborhoods, and is not disputed by Protestant.
A 164
Federal Reserve Bulletin • February 1980
of those policies. To date meetings with community
groups have tended to be initiated by the community
groups, rather than FNBB. However, in light of Applicant's willingness to improve its performance in this
area, the Board expects that FNBB will take affirmative action to intensify its efforts to meet with such
groups.
With regard to FNBB's alleged closing of two
branches located in low- and moderate-income neighborhoods, the Board notes that FNBB transferred its
Mattapan branch to minority-controlled Unity Bank
and Trust Company, Boston, Massachusetts, which
assumed operation of the branch with no interruption
in service to the community. Moreover, since the
transfer, FNBB has assisted Unity in its continued operation of the Mattapan branch by training lending officers, and providing marketing assistance and staffing.
FNBB has also helped to strengthen Unity's overall
financial position by investing in Unity's capital notes
and affording Unity the opportunity to purchase certain loans from FNBB order to provide it with additional earnings. Applicant plans to dispose of another
of FNBB's branches in a similar manner. While the
Board may not prescribe the manner in which an applicant conducts its business transactions provided such
transactions comply with applicable laws and conform
to principles of banking safety and soundness, the
Board does expect an applicant to conduct its operations with due regard to serving the needs of its community. From the record it appears that Applicant and
FNBB have found a reasonable means of disposing of
the branches in question while at the same time assuring that the localities and customers served by these
branches will continue to have an adequate source of
credit and other banking services. Accordingly, the
Board is unable to conclude that the disposal of the
two branches in question is evidence that Applicant
and FNBB are not attempting to meet the needs of
FNBB's community.
With respect to FNBB's record of residential mortgage lending, from the record it appears that both the
number and dollar volume of such loans are low. Furthermore, the record indicates that there are a number
of low- and moderate-income neighborhoods where
FNBB has originated no mortgage or home-improvement loans. FNBB attributes the small volume of
mortgage loans to management's prior policy of accepting loan applications only from individuals who
had a depository relationship with FNBB. Moreover,
until two years ago, FNBB had made mortgage loans
only as an accommodation to corporate clients, and
this limitation has contributed to the current low volume of mortgages outstanding. However, FNBB has
included mortgage loans in its CRA statement as one
of the types of credit offered, and the Board expects
every organization to provide to the community in a
fair and nondiscriminatory manner the type of credit
listed in its CRA statement and to make known to its
community that such credit is available. Applicant has
stated that FNBB's policy of accepting mortgage applications only from existing depositors has been discontinued in an effort to promote additional applications. In addition, Applicant states that it is making
efforts and developing plans to advise its community
of the availability of mortgage and home-improvement
credit. The board has relied on Applicant's representations in this regard, and the Board expects that Applicant will intensify its efforts to upgrade its commitment to extending mortgage credit throughout
FNBB's entire community, particularly to the low- to
moderate-income areas of that community.
With respect to the allegation that FNBB's community development efforts are insignificant in relation to
Applicant's resources, the Board notes that in its recent information statement regarding consideration of
relevant factors under CRA, the Board stressed that it
is not so much concerned with the ratio of loans to a
particular area or activity as with lender sensitivity to
credit needs of a particular segment. In this regard it
appears that Applicant has a positive record of attempting to assess and meet credit needs of local community and minority-owned small businesses. For example, since 1970, FNBB has operated an urban
marketing program that specializes in financing inner
city minority businesses. Credit-worthy borrowers are
sought through contact with local community groups
and most of the loans are advanced under the auspices
of the small business groups. As a result of these efforts, over the past five years FNBB has extended approximately $4 million in loans through its urban marketing program to small businesses located in low- and
moderate-income areas in Suffolk County, 80 percent
of which are minority-owned.
In addition to its urban marketing program, Applicant has made a major commitment to small business
lending generally by offering reduced rates on such
loans. Specifically, in December 1978 FNBB introduced a special small business index rate (SBIR) for
loans to small business and nonprofit corporations
owned in New England that is 1.25 percent below Applicant's basic business loan rate. As a result, as of
May 1979, 3,660 loans totalling $108 million had been
extended under the SBIR program. FNBB has also
demonstrated a commitment to student loan programs,
and as of May 1979, FNBB had a total of 10,300 student loans outstanding with a total dollar value of
$12.8 million, of which $7.1 million represented 3,500
Higher Education Loan Plan loans primarily to students from low- to moderate-income families.
In addition to its efforts regarding small business
loans, Applicant has participated in a number of other
community-oriented lending programs. Applicant has
Legal Developments
been an active participant in the principal Boston community development program, "The Boston Plan,"
that is targeted, among other things, to develop and
support commercial enterprises in one of Boston's
low-income neighborhoods. Applicant has committed
$1.6 million to this plan and has indicated a commitment to the residential rehabilitation portion of the
neighborhood's renovation program. In addition, since
1974, Applicant has participated in the management
and operation of the Boston Neighborhood Housing
Services program and has recently commited to support a community development block grant program in
the town of Winthrop. Finally, by purchasing and underwriting the securities of Massachusetts Housing Finance Agency (MHFA), Applicant indirectly provides
funds to meet the low- and moderate-income housing
needs in Suffolk County, which constitute the primary
use of the proceeds of the sale of MHFA securities.
With regard to the allegation that Applicant's record
with respect to its other subsidiary banks demonstrates significant disinvestment in the local communities, data submitted by Protestant indicated that loan
participations between FNBB and Applicant's other
subsidiary banks resulted in a $10.9 million outflow of
funds from these smaller banks. The Board is of the
opinion that the entire record does not support a finding of community disinvestment. A loan participation
schedule submitted by Applicant shows that as of December 31, 1978, the six smaller subsidiary banks had
purchased $13.6 million in loans from FNBB and sold
$2.7 million in loans to FNBB. However, during this
period, Applicant supplied $13 million in new capital
to these subsidiaries resulting in a net inflow to the
subsidiaries of $2.1 million. Thus, the Board concludes
that Protestant's allegation in this regard is not supported by the facts of record.
The Board also notes that upon consummation of
acquisition, Applicant states that it will cause Bank to
offer its customers a number of new services: NOW
accounts, credit card services, and commercial accounts receivable, chattel mortgage and floor plan financing. In addition, within six months, Applicant
would cause Bank to lower to $100 the minimum deposit required on its 1 to 4 year certificates of deposit
and to eliminate the $300 minimum deposit required on
Bank's 90-day notice account. Protestant asserts that
these services are available from other banks in the
market and that their benefits are therefore illusory.
The Board believes that the benefits resulting from this
transaction are of benefit to the community to be
served and that the introduction of these services will
enhance competition in the New Bedford banking market. Thus, based on its evaluation of the entire record
on this application, including Applicant's and FNBB's
overall record of performance with respect to the factors to be considered under CRA, the Board is of the
165
opinion that considerations relating to the convenience
and needs of the community to be served are favorable
and lend some weight toward approval of the application.
Based on the foregoing, it is the Board's judgment
that approval of the applications would be in the public
interest and that the applications should be approved.
On the basis of the record, the applications are approved for the reasons summarized above. These
transactions shall not be made 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 Boston, pursuant to delegated authority.
By Order of the Board of Governors, effective
January 28, 1980.
Voting for this action: Chairman Volker and Governors
Schultz, Wallich, Cold well, Partee, and Rice. Absent and not
voting: Governor Teeters.
[SEAL]
(Signed) G R I F F I T H L. G A R W O O D ,
Deputy Secretary of the Board.
Guaranty Development Company,
Livingston, Montana
Order Approving Acquisition of Bank
Guaranty Development Company, Livingston, Montana, a bank holding company within the meaning of
the Bank Holding Company Act, has applied for the
Board's approval under section 3(a)(3) of the Act (12
U.S.C. § 1842(a)(3)) to acquire 53.8 percent of the voting shares of First Security Bank of Big Timber
("Bank"), Big Timber, Montana.
Notice of the application, affording opportunity for
interested persons to submit comments and views, has
been given in accordance with section 3(b) of the Act.
The time for filing comments and views 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 Act (12 U.S.C. § 1842(c)).
Applicant, a one-bank holding company that became a bank holding company as a result of the 1970
Amendments to the Act, ccoitrols one bank with deposits of $31.3 million, representing 0.8 percent of the
total deposits in commercial banks in the state.1 Acquistion of Bank, which holds deposits of $5.3 million,
would increase Applicant's share of statewide deposits
by 0.1 percent and would not result in a significant in-
1. All banking data are as of September 30, 1978.
A 166
Federal Reserve Bulletin • February 1980
crease in the concentration of banking resources in
Montana.
Bank is the smaller of two banks operating in the
relevant banking market2 controlling 24.8 percent of
market deposits. Applicant's banking subsidiary is located in a separate, though adjacent, banking market
and no significant existing competition would be eliminated by consummation of this proposal. Although
Applicant is capable of entering the market de novo, it
does not appear from the facts of record that the market is particularly attractive for de novo entry. On the
basis of the above and other facts of record, the Board
concludes that competitive considerations are consistent with approval of the application.
The financial and managerial resources of Applicant, its subsidiary bank, and Bank are regarded as
satisfactory and their future prospects appear favorable. Accordingly, banking factors are consistent with
approval of the application. Although Applicant proposes no immediate changes in the services offered by
Bank, considerations relating to the convenience and
needs of the community to be served are consistent
with approval of the application.
Applicant currently engages in certain nonbanking
activities pursuant to section 4(c)(ii) of the Act, which
provides a total exemption from the prohibitions of
section 4 of the Act against nonbanking activities.3
Based upon its review of the legislative intent of Congress in providing this exemption, it is the Board's
judgment that the exceptionally broad exemption afforded by section 4(c)(ii) must be limited to familyowned one-bank holding companies that are not engaged in the management of banks. Moreover, in the
Board's view, upon the acquisition of an additional
bank, a one-bank holding company that is exempt under section 4(c)(ii) of the Act, would become engaged
in the management of banks, and would thereby terminate its eligibility for the exemption. In addition, the
Board believes that to permit unsupervised nonbank
expansion by a multibank holding company would
constitute an evasion of the Act, which the Board is
authorized to prevent pursuant to section 5(b) of the
Act. Accordingly, the Board concludes that upon the
acquisition of Bank, Applicant will no longer be eligible for the exemption for its nonbanking activities
afforded by section 4(c)(ii) of the Act. 4
Based on the foregoing, it is the Board's judgment
that the proposed transaction would be consistent with
the public interest and that the application should be
approved. Accordingly, the application is approved
for the reasons summarized above. The transaction
shall not be made before the thirtieth calender day following the effective date of this Order or later than
three months after the effective date of the Order, unless such period is extended for good cause by the
Board, or by the Federal Reserve Bank of Minneapolis
pursuant to delegated authority.
By order of the Board of Governors, effective January 25, 1980.
Voting for this action: Chairman Volcker and Governors
Schultz, Wallich, Partee, and Rice. Absent and not voting:
Governors Coldwell and Teeters.
[SEAL]
(Signed) G R I F F I T H L . G A R W O O D ,
Deputy Secretary of the Board.
The Marine Corporation,
Milwaukee, Wisconsin
Order Approving Acquisition of Bank
The Marine Corporation, Milwaukee, Wisconsin, a
bank holding company within the meaning of the Bank
Holding Company Act, has applied for the Board's approval under section 3(a)(3) of the Act (12 U.S.C. §
1842(a)(3)) to acquire 80 percent or more of the voting
shares of Commercial State Bank, Madison, Wisconsin ("Bank").
Notice of the application, affording opportunity for
interested persons to submit comments and views, has
been given in accordance with section 3(b) of the Act
(12 U.S.C. § 1842(b)). The time for filing comments and
views has expired, and the application and all comments received, including the submission from Lake
City Bank, Madison, Wisconsin ("Lake City Bank"),
have been considered by the Board in light of the factors set forth in section 3(c) of the Act (12 U.S.C. §
1842(c)).
Applicant, the third largest banking organization in
Wisconsin, controls 17 banks with aggregate deposits
of approximately $1.3 billion, representing 6.6 percent
of total deposits in commercial banks in the state.1 Ac-
2. The relevant market is approximated by Sweet Grass County,
Montana.
3. Section 4(c)(ii) exempts from the prohibitions of section 4
"a company covered in 1970 more than 85 percentum of the
voting stock of which was collectively owned on June 30, 1968
and continuously thereafter, directly or indirectly by or for
members of the same family, or their spouses, who are lineal
descendants of common ancestors:"
banking subsidiary) appear to be exempt under section 4(c)(1) (C) of
the Act. Applicant also has one small loan outstanding to one of its
principals. In view of the size of this loan, and the circumstances under which it was made, the Board does not regard Applicant as being
engaged in lending activities. However, Applicant may not make any
additional loans without obtaining the Board's prior approval under
section 4 of the Act.
4. Absent the exemption afforded by section 4(c)(ii), Applicant's
existing nonbanking activities (leasing a condominum and airplane for
use in its bank business and furnishing data processing services to its
1. All banking data are as of December 31, 1978, and reflect bank
holding company formations and acquisitions approved as of October
30, 1979.
Legal Developments
quisition of Bank ($29.8 million in deposits), the 164th
largest banking organization in Wisconsin, will increase Applicant's share of commercial bank deposits
by only 0.2 percent and will not alter Applicant's ranking in the state.
Bank is the ninth largest of 23 banking organizations
in the Madison banking market (the relevant market)2
and controls 2.5 percent of total commercial bank deposits therein. Applicant is the fourth largest banking
organization in the Madison market through its control
of Security Marine Bank ("Security Bank") ($70.9
million in deposits), holding 6.1 percent of the market's commercial bank deposits. Upon consummation
of the proposal Applicant's market share will increase
to 8.6 percent, but due to the presence of significantly
larger banking organizations in the market, its ranking
will remain unchanged. In light of the above and other
facts of record, the Board finds that consummation of
this proposal will result in the elimination of existing
competition between Security Bank and Bank,3 will
remove an independent competitor from the Madison
market and will increase the concentration of banking
resources in the market. These facts would appear to
warrant a finding that consummation of this proposal
would have serious adverse competitive effects 4 .
However, the Board notes there are other facts in the
record bearing upon the competitive effects of the proposal and, based upon its consideration of all the facts,
concludes that such a finding is not warranted.
The Board believes that proposals involving the acquisition of an independent banking organization by an
organization already represented in a market must be
analyzed carefully, giving attention to all of the facts
presented in each case, such as the structural characteristics of the market as well as the quantitative fac2. The Madison banking market is approximated by the Madison,
Wisconsin RMA.
3. Lake City Bank, in its submission to the Board, states that it
does not object to Applicant's acquisition of Bank but only to the acquisition of Bank's Milwaukee Street Branch ("Branch") because
such an acquisition will effectively eliminate existing competition in
the area served by Branch. The Board notes that offices of Security
Bank are convenient banking alternatives to Branch and that consummation of this proposal will eliminate meaningful existing competition,
particularly in the northeast portion of the Madison banking market;
however, for the reasons discussed below, the Board finds denial of
the proposal is not warranted.
4. In an analysis based solely on market share, the competitive effects of this proposal are similar to those presented in an application
the Board recently denied (County National Bancorporation/T.G.B.,
6 5 FEDERAL RESERVE BULLETIN, 7 6 3 ( 1 9 7 9 ) ( " C o u n t y N a t i o n a l " ) ) .
However, the Board's Order in County National reflects the Board's
determination that market share is not the only factor the Board considers in assessing the competitive effects of a proposal. In County
National, the Board found significant that the proposal would result in
the merger of two sizeable "banking organizations comparably balanced and poised as natural competitors for the same range of business within the market" (See footnote 3 in County National Order). In
addition, the Board noted that the County National proposal would
have eliminated a lead bank and its independent holding company
from the St. Louis banking market. Neither of these facts is present in
the subject proposal.
167
tors associated with the proposal. In this regard, the
Board notes that the largest banking organization in
the Madison banking market, First Wisconsin Corporation ("First Wisconsin"), controlling 26.8 percent of
market deposits, is also the largest banking organization in the state. In addition, the market share held by
First Wisconsin and the second largest banking organization in the market is over 47 percent or nearly six
times the market share that will be controlled by Applicant. The Board also believes that consideration
should be given to the fact that the organization to be
acquired is a relatively small institution. Accordingly,
the Board concludes that the overall competitive effects of this proposal do not warrant denial; futhermore, any anticompetitive effects are outweighed by
the convenience and needs considerations associated
with this application.
The financial and managerial resources and future
prospects of Applicant, its subsidiaries, and Bank are
regarded as generally satisfactory, particularly in light
of steps Applicant will undertake to strengthen and improve Bank's overall condition. Applicant also intends
to inject capital into certain of its other subsidiary
banks. In addition to the fact that affiliation with Applicant, will strengthen Bank's overall condition, it will
enable Bank to introduce new and expanded services
to its customers. Upon consummation of this proposal, Applicant intends to assist Bank in developing
its commercial loan portfolio and in offering lease financing, increasing its agricultural loans, and its marketing, computer and management services. Applicant
also intends to assist Bank in improving its physical
facilities. In light of the above, considerations relating
to the convenience and needs of the community to be
served lend significant weight toward approval of the
application and outweigh the adverse competitive effects that might result from consummation of this proposal. Accordingly, the Board has determined that the
application should be approved.
On the basis of the record, the application is approved for the reasons summarized above. The transaction shall not be made 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 Chicago,
pursuant to delegated authority.
By order of the Board of Governors, effective January 11, 1980.
Voting for this action: Vice Chairman Schultz, Governors
Wallich, Cold well, Teeters, and Rice. Voting against this action: Governor Partee. Absent and not voting: Chairman
Volcker.
(Signed)
[SEAL]
GRIFFITH L . GARWOOD,
Deputy Secretary of the Board.
A 168
Federal Reserve Bulletin • February 1980
Dissenting Statement of Governor Partee
I would deny the application of The Marine Corporation to acquire Commercial State Bank. I believe that
the issue presented by this application was addressed
by the Board when it considered the application by
County National Bancorporation, Clayton, Missouri,
a bank holding company, to acquire control of another
bank holding company, T. G. Bancshares, Co., St.
Louis, Missouri, operating in the same market as
County National. (65 F E D E R A L RESERVE B U L L E T I N
763 (1979)). In that case, the resulting organization
would have controlled 5.6 percent of the St. Louis
banking market's commercial bank deposits, and
would have become the market's fourth largest banking organization.
In view of the Board's denial of the County National
proposal, it would seem to me consistent that the
Board deny this application as well. The market shares
at issue in this proposal are larger than was the case in
County National. Futhermore, I do not believe the seriously adverse competitive effects of this proposal, as
reflected in a market share analysis, are mitigated by
convenience and needs considerations or any special
characteristics of the Madison market. Accordingly,
while I would not have denied County National in the
first instance, I believe that based upon the Board's
action in that case and the facts of record in the instant
proposal, this case should be denied.
Orders Under Section 4
of Bank Holding Company Act
Chase Manhattan Corporation,
New York, New York
Order Granting Amended Application to
Engage in Certain Insurance Agency Activities
On September 22, 1975, the Board of Governors issued an Order modifying its previous Order of July 14,
1975, and approving the application of Chase Manhattan Corporation, New York, New York ("Chase"), to
engage de novo through its subsidiary, Housing Investment Corporation of Florida ("HIC") in the sale
pursuant to section 4(c)(8) of the Bank Holding Company Act, 12 U.S.C. § 1841 et seq. ("Act"), of creditrelated property and liability insurance, credit life,
credit accident and health insurance, mortgage redemption insurance and homeowners comprehensive
policies. 1
1. At the same time, the Board approved the applications of several
other bank holding companies to engage in similar insurance agency
activities. However, following the litigation described later in the text,
Chase is the only one of these bank holding companies that requested
the Board to consider its amended application.
Chase's application had been protested by the Independent Insurance Agents of America, formerly the
National Association of Insurance Agents, Inc., and
the Florida Association of Insurance Agents, Inc. (together referred to herein as "Protestants"). The Board
had directed that public hearings on the Chase application be held before an Administrative Law Judge
("ALJ") and such hearings were held between June 11
and June 21, 1975. The ALJ made certain findings and
recommended that, with certain conditions, Chase's
application be approved. Immediately thereafter, the
Florida legislature enacted a law limiting the permissible insurance agency activities of bank holding companies in Florida.2 After reviewing the findings and
recommendations of the ALJ and the effect of the newly
enacted statute on the scope of the proposal, the Board
approved Chase's application. Protestants subsequently
petitioned for judicial review of the Board's action.
On March 19, 1979, the United States Court of Appeals for the Fifth Circuit remanded the matter of
Chase's application to the Board for further development of evidence with respect to the effect of the intervening Florida law upon the Board's findings on the
public benefits associated with Chase's application
and with instructions to explain the conclusions of the
Board in this regard that differed from those of the
ALJ.3 In response to the Court's instructions, the
Board directed Chase to supplement the record with
information on these issues and afforded to Protestants
the opportunity to comment on Chase's submissions.
Chase amended its application so as to limit its proposal to insurance agency activities permitted by Florida law and detailed the public benefits expected to result from its proposal. Thereafter, by letter of August
17, 1979, Protestants withdrew their opposition to the
Chase application. Accordingly, there appears to be
no reason for further proceedings before an Administrative Law Judge. The Board had reviewed the entire
record relating to the application, including Chase's
recent submissions and Protestant's response thereto,
and makes the following findings as to the facts and the
conclusions to be drawn therefrom.
Chase, a bank holding company within the meaning
of the Act, has amended its application under section
4(c)(8) of the Act and section (b) (1) of the Board's
Regulation Y to engage de novo through HIC in the
sale of (1) insurance that assures repayment of mortgage loans made by HIC in the event of death or disability of the borrower, and (2) insurance that protects
property that is collateral for a mortgage loan against
loss or damage, but excluding insurance customarily
written under an inland marine form. Chase has committed to engage in the sale of such insurance in con2. Florida Statue § 626.988 (1977).
3. Florida Association of Insurance Agents, Inc. v. Board of Governors. 591 F2d 334 (5th Cir. 1979).
Legal Developments
formance with Florida law (including that enacted subsequent to the ALJ's decision in this case) and the
Board's regulations. In particular, Chase will engage
in this activity only to the extent that such insurance is
directly related to real estate mortgage loans made or
brokered by licensees under chapter 494, Florida Statutes, and only to the extent necessary to protect
against loss or damage to the real property that is subject to mortgage, on residential property consisting of
not more than four individual dwelling units.
The Administrative Law Judge and the Board previously found that insurance activities proposed by
Chase are authorized by section 225.4 (a)(9) of Regulation Y and are so closely related to banking or managing or controlling banks as to be a proper incident
thereto. The Fifth Circuit Court of Appeals, in the
Florida case, left this determination undisturbed.
Therefore, the Board believes that it is neither necessary nor appropriate to reconsider these conclusions.
Upon consideration of Chase's amended application, the Board is of the view that, even in light of
the limited scope of insurance activities permitted under amended Florida law, the performance of the proposed insurance agency activities by Chase through
HIC reasonably can be expected to produce benefits to
the public that outweigh possible adverse effects. In
particular, approval of the application would favor the
public interest by introducing into the communities
served by HIC4 an additional source of mortgage-related insurance, thereby increasing overall competition in these communities and the surrounding
areas. The Board has long recognized that de novo entry is pro-competitive and provides a public benefit.5
Additionally, approval of the application will result in
some gain in efficiency as Chase will utilize present
physical locations, office equipment, computer hardware and software, and various personnel support
service capabilities to generate additional revenue. Ultimately, the more efficient use of its investments
should result in lower prices to HIC's customers. Finally, approval of this application will provide mortgage
customers of HIC the advantages of one-stop shopping. HIC will offer insurance through four of its subsidiary offices and plans to have at least one insurance
agent located on the premises of each of those offices.
Accordingly, customers will be able to purchase their
mortgage-related insurance at the same place and time
that they receive their mortgage and also will be afforded the convenience of centralized billing.
In connection with Chase's original application, the
Administrative Law Judge found that certain possible
4. HIC will sell insurance at offices located in Miami, Jacksonville,
Tampa, and Alamonte Springs, Florida.
5. S e e e.g.,
U . N . Bancshares,
Inc.,
BULLETIN 2 0 4 (1973) a n d Citicorp-Westport,
BULLETIN 510 (1979).
5 9 FEDERAL RESERVE
6 4 FEDERAL RESERVE
169
adverse effects would result from approval of the application.6 The Board in its September 22, 1975, Order
found that no such adverse effects would result. Upon
reconsideration of the evidence of record, the Board
remains of the view that no reasonably forseeable or
possible adverse effects would result from approval of
this application. In particular, the record shows that
HIC was organized in 1972 and originates less than 0.1
percent of the residential mortgage loans in Florida.
Futhermore, there are numerous alternative sources of
mortgage credit and insurance in Florida, HIC proposes to engage in its insurance agency activities de
novo and the scope of insurance activities in which
HIC may permissibly engage is severely restricted by
Florida law, as described above, and by the Board's
regulations. Based upon this information, it does not
appear that approval of this application will result in a
concentration of resources in any market, any unfair
competitive advantages for HIC or Chase, decreased
competition within the insurance industry or reduction
of opportunities for individual entrepeneurs. Furthermore, there is no evidence in the record to indicate any
other adverse effects that would result from approval
of the application.
Based upon the foregoing, the Board has determined
in accordance with the provisions of section 4(c)(8)
that consummation of the proposal can reasonably be
expected to produce public benefits that outweigh possible adverse effects. Accordingly, Chase's application
to sell the limited insurance coverages enumerated
above and expressly permitted under Florida law is
hereby approved.
This determination supersedes the Board's Order of
September 22, 1975, and is conditioned upon Applicant's conduct of these activities in accordance with
all applicable Florida insurance laws. This determination is further subject to the conditions set forth in
§ 225.4(c) of Regulation Y 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 the provisions and purposes of the Act and the
Board's regulations and orders issued thereunder or to
prevent evasion thereof. The transactions herein approved shall be executed not 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, pursuant to delegated authority.
By order of the Board of Governors, effective January 11, 1980.
6. It should be noted that because Chase does no banking business
in Florida, the ALJ found relatively fewer adverse affects in connection with Chase's application than with the other applications,
which since have been abandoned, as described in footnote 1 supra.
A 170
Federal Reserve Bulletin • February 1980
Voting for this action: Vice Chairman Schultz and Governors Coldwell, Partee, and Rice. Present and not voting:
Governor Wallich. Absent and not voting: Chairman Volcker
and Governor Teeters.
[SEAL]
(Signed) G R I F F I T H L . G A R W O O D ,
Deputy Secretary of the Board.
NCNB Corporation,
Charlotte, North Carolina
First Atlanta Corporation,
Atlanta, Georgia
First and Merchants Corporation,
Richmond, Virginia
Order Approving
Retention of Tri-South Management
Associates
NCNB Corporation, Charlotte, North Carolina
("NCNB") (through its direct subsidiary, NCNB TriSouth Corporation, Charlotte, North Carolina), First
and Merchants Corporation, Richmond, Virginia
("Merchants Corporation") (through its direct subsidiary, First and Merchants Tri-South Corporation,
Richmond, Virginia), and First Atlanta Corporation,
Atlanta, Georgia ("Atlanta Corporation") (through its
indirect subsidiary, First Atlanta Tri-South Corporation, which is a subsidiary of T & B.P.C., Inc., Atlanta, Georgia, a direct subsidiary of Atlanta Corporation), (together, "Applicants"), bank holding
companies within the meaning of the Bank Holding
Company Act, as amended, 12 U.S.C. § 1841 et seq.
(the "Act"), have applied for the Board's approval,
under section 4(c)(8) of the Act and section 225.4(b) of
the Board's Regulation Y, to retain until December 31,
1983, voting shares of Tri-South Management Associates ("Associates"),1 a partnership whose only activity
is to act as investment adviser to Tri-South Mortgage Investors ("Company"), a Massachusetts
business trust operating as a real estate investment
trust.2 This activity has been determined to be permissible for bank holding companies (12 C.F.R. §
225.4(a)(5)).
Notice of the applications, affording opportunity for
interested persons to submit comments and views on
the public interest factors, has been duly published
(44 Federal Register 64567 (1979)). The time for filing
1. In addition, Applicants each own shares of Company. In view of
the fact that no one of the Applicants control 5 percent of Company's
stock, no application is required with respect to these shares. (12
U.S.C. § 1843(c)(6)).
2. Company is a publicly held real estate investment trust.
comments and views has expired and the Board has
considered the applications and all comments received
in light of the public interest factors set forth in section
4(c)(8) of the Act (12 U.S.C. § 1843(c)(8)).
NCNB, the second largest banking organization in
North Carolina, is a one-bank holding company with
deposits of approximately $3.9 billion, representing
18.2 percent of the total deposits in commercial banks
in the state.3 Through its subsidiary, NCNB Mortgage
Corporation, NCNB engages in the mortgage banking
business from offices in North Carolina, South Carolina, Georgia, and Florida.
Merchants Corporation, the fourth largest banking
organization in Virginia, is a one-bank holding company with deposits of approximately $1.6 billion, representing 8.4 percent of total deposits in commercial
banks in the state. Through its subsidiary, First Mortgage Corporation, Merchants Corporation engages in
the mortgage banking business, primarily in the State
of Virginia.
Atlanta Corporation, the second largest banking organization in Georgia, has three banking subsidiaries
with aggregate deposits of $1.9 billion, representing
12.0 percent of total deposits in commercial banks in
the state. Through its subsidiary, Tharpe & Brooks,
Inc., Atlanta Corporation engages in the mortgage
banking business serving the states of Georgia and
Florida.
Applicants jointly commenced Associates in 1970
when each Applicant was a one-bank holding company
within the meaning of the 1970 Amendments to the
Act. Pursuant to the provisions of section 4(a)(2) of the
Act, Applicants have until December 31, 1980, to divest of their interests in Associates or file applications
to retain such interests. The Board regards the standards under section 4(c)(8) for retention of activities to
be the same as the standards for a proposed acquisition of a section 4(c)(8) activity.
Applicants propose to jointly continue to act as investment adviser and financial consultant to Company
through their respective interests in Associates. Associates' only client has been and continues to be Company. The extent to which this joint venture eliminated
existing competition is determined by the facts that existed at the time Applicants entered into the activity.4
The record indicates that at that time none of the Applicants was engaged in acting as investment adviser to
a real estate investment trust and that this joint venture represented de novo entry by each Applicant into
the activity. Therefore, no existing competition was
eliminated.
3. Banking data for NCNB and Merchants Corporation are as of
June 30, 1979. Banking data for Atlanta Corporation are as of December 31, 1978.
4. United States v. Penn-Olin Chemical Co., 378 U.S. 158 (1964).
Legal Developments
The Board also considers whether, at its inception,
any potential competition between the Applicants may
have been eliminated by this joint venture. In answering this question, the Board considers whether, absent
this joint venture, any one of the Applicants would
have entered the market on its own. From the record,
it appears that each Applicant separately considered
engaging in this activity but determined that such an
undertaking was not economically feasible. Accordingly, it does not appear that the joint venture had any
adverse effects on potential competition. At the time
Applicants entered into this joint venture it was proposed that Associates would advise Company about
investment opportunities, including evaluating specific
loans and supervising Company's investment operations. However, since 1974, Associates' sole function
has been to administer existing loan contracts and
there are no present plans to expand its activities. Accordingly, the Board concludes that the formation of
this joint venture had no significant effects on competition and that Applicants' retention of Associates
would not have any significant competitive effects.
Furthermore, there is no evidence in the record indicating that the proposal would result in undue concentration of resources, unfair competition, conflicts
of interests, unsound banking practices or other adverse effects.
It is the Board's judgment that this joint venture resulted in public benefits through the addition of another competitor in the market, and that Applicants' temporary retention of their interests continues to be in
the public interest.
Based upon the foregoing and other considerations
reflected in the record, the Board has determined that
the balance of the public interest factors the Board is
required to consider under section 4(c)(8) is favorable.
Accordingly, the applications are hereby approved.
This determination is subject to the conditions set
forth in section 225.4(c) of Regulation Y 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 the provisions and purposes of
the Act and the Board's regulations and orders issued
thereunder, or to prevent evasion thereof.
By order of the Board of Governers, effective
January 11, 1980.
171
Order Under Section 2
of Banking Holding Company Act
Comanche Land and Cattle Company,
Comanche, Texas
Order Granting Determination Under the
Bank Holding Company Act
Comanche Land and Cattle Company, Comanche,
Texas ("'Comanche"), a bank holding company within
the meaning of the Bank Holding Company Act of
1956, as amended,1 has requested a determination pursuant to section 2(g)(3) of the Act (12 U.S.C. §
1842(g)(3)) that it is not in fact capable of controlling
First State Bank of Bangs, Bangs, Texas ("Bank"), or
the individual to whom it transferred 28 percent of
Bank's voting shares, notwithstanding the fact that
such transferee is a director and officer of Comanche.
Under the provisions of section 2(g)(3) of the Act,
shares transferred after January 1, 1966, by any bank
holding company to a transferee that is indebted to the
transferor or has one or more officers, directors,
trustees, or beneficiaries in common with or subject to
control by the transferor, are deemed to be indirectly
owned or controlled by the transferor unless the
Board, after opportunity for hearing, determines that
the transferor is not in fact capable of controlling the
transferee.2 It is hereby determined that Comanche is
not in fact capable of controlling the individual transferee or Bank. This determination is based upon the
evidence of record in this matter, including the following facts.
Comanche is a closely-held corporation with four
shareholders. Comanche, which once held 65 percent
of the shares of Bank, reduced its ownership to 24 percent by distributing 41 percent of the shares of Bank to
its shareholders. Comanche held 25 percent or more of
Bank's shares for only slightly more than one year.
One of Comanche's shareholders, who received 28
percent of Bank's shares, is also a director and officer
of Comanche. However, it appears that since this individual owns 70 percent of Comanche's shares. Comanche should be regarded as his alter ego, and there is
no evidence in the record to contradict this conclusion.
With respect to its continued ownership of shares of
Bank, Comanche has committed that it will not vote its
shares of Bank, and that all transactions between Co-
Voting for this action: Vice Chairman Schultz and Governors Wallich, Cold well, Partee, and Rice. Absent and not
voting: Chairman Volcker and Governor Teeters.
[SEAL]
(Signed) G R I F F I T H L. G A R W O O D ,
Deputy Secretary of the Board.
1. The granting of this request will terminate Comanche's status as
a bank holding company.
2. In its January 26, 1978 interpretation of section 2(g)(3), the Board
stated that the presumption would apply where shares are transfered
directly to one or more persons who are directors or officers of the
transferor.
A 172
Federal Reserve Bulletin • February 1980
manche and Bank will be conducted in the ordinary
course of business. Moreover, Comanche has committed that it will not have any directors or officers in
common with Bank, and it has terminated all management interlocks with Bank that existed at the time of
transfer. Finally, Comanche's board of directors has
adopted a resolution to the effect that Comanche does
not, and will not attempt to, exercise a controlling influence over Bank or the transferee of Bank's shares.
Similarly, the board of directors of Bank have adopted
a resolution to the effect that it is not and will not be
controlled by Comanche, and the individual transferee
has made an affidavit that he is not, and will not be,
subject to Comanche's control.
On the basis of the foregoing and other facts of record, it is hereby determined that control of the divested shares of Bank rest with the transferee as an
individual, and there is no evidence that Comanche
controls or is capable of controlling Bank or its principal shareholder in his capacity as transferee of the
stock of Bank. Accordingly, it is ordered, that the
request of Comanche for a determination pursuant to
section 2(g)(3) be granted. This determination is based
on the representations made to the Board by Comanche and the transferee of Bank's shares. In the event
that the Board should hereafter determine that facts
material to this determination are otherwise than as
represented, or that Comanche or the transferee have
failed to disclose to the Board other material facts, this
determination may be revoked, and any change in the
facts and circumstances relied upon by the Board in
making this determination could result in the Board reconsidering the determination made herein.
By order of the Board of Governors, acting through
its General Counsel, pursuant to delegated authority
(12 C.F.R. § 265.2(b)(1), effective January 15, 1980.
(Signed)
[SEAL]
GRIFFITH L . GARWOOD,
Deputy Secretary of the Board.
Bank Holding Company Tax Act of 1976, that its proposed divestiture of all of the 218,166 shares (36 percent) of City National Bank of Fort Smith, (Bank) Fort
Smith, Arkansas, presently held by First, through the
pro rata distribution to First's stockholders of the
stock of a corporation (New Corporation) created and
availed of solely for the purpose of receiving First's
Bank shares, is necessary or appropriate to effectuate
the policies of the Bank Holding Company Act (12
U.S.C. § 1841 et seq) (BHC Act). First proposes to
exchange the 216,166 shares of Bank it presently owns
for all of the shares of New Corporation. After; the exchange, First proposes immediately to distribute all of
New Corporation's shares pro rata to the holders of
common stock of First.
In connection with this request, the following information is deemed relevant, for purposes of issuing the
requested certification:1
1. First is a corporation organized under the laws of
Arkansas on November 5, 1928. On July 24, 1953,
First acquired ownership and control of 28,550 shares,
representing 95.2 percent of the outstanding voting
shares, of Bank. On July 7, 1970 First held 148,872
shares, representing 71.8 percent of the outstanding
voting shares, of Bank. On February 28, 1978, First
acquired an additional 131,980 shares of Bank in a
transaction in which 2 shares of Bank common stock
were issued to shareholders of Bank for every one
share of common stock held by such shareholder.2
2. First became a bank holding company on December 31, 1970, as a result of the 1970 Amendments to the
BHC Act, by virtue of its ownership and control at
that time of more than 25 percent of the outstanding
voting shares of Bank, and it registered as such with
the Board on August 15, 1971. First would have been a
bank holding company on July 7, 1970, if the BHC Act
Amendments of 1970 had been in effect on that date by
virtue of its ownership and control on that date of
more than 25 percent of the outstanding voting shares
of Bank. First presently owns and controls 218,166
Certification Pursuant to the
Bank Holding Company Tax Act of 1976
First Pyramid Life Insurance Company,
Little Rock, Arkansas
Prior Certification Pursuant to the
Bank Holding Company Tax Act of 1976
[Docket No. TCR 76-179]
First Pyramid Life Insurance Company, (First) Little
Rock, Arkansas, has requested a prior certification
pursuant to section 1101(c)(3) of the Internal Revenue
Code ("Code"), as amended by section 2(a) of the
1. This information derives from First's correspondence with the
Board concerning its request for this certification, First's Registration
Statement filed with the Board pursuant to the BHC Act, and other
records of the Board.
2. Under subsection (c) of section 1101 of the Code, property acquired after July 7, 1970, generally does not qualify for the tax benefits
of section 1101(b) when distributed by an otherwise qualified bank
holding company. However, where such property was acquired by a
qualified bank holding company in a transaction in which gain was not
recognized under § 305(a) of the Code, then section 1101(b) is applicable. First has stated that the shares it received on February 28,1978,
were received in a transaction in which gain was not recognized under
section 305(a) of the Code. Accordingly, even though 131,980 shares
of Bank common stock were acquired by First after July 7,1970, those
shares would nevertheless qualify as property eligible for the tax benefits provided in section 1101(b) of the Code if those shares were, in
fact, received in a transaction in which gain was not recognized under
section 305(a) of the Code.
Legal Developments
shares, representing 36 percent of the outstanding voting shares, of Bank.
3. First holds property acquired by it on or before
July 7, 1970, the disposition of which but for the proviso of section 4(a)(2) of the BHC Act would be necessary or appropriate to effectuate section 4 of the BHC
Act if First were to continue to be a bank holding company beyond December 31, 1980, and which property,
but for such proviso, would be "prohibited property"
within the meaning of section 1103(c) of the Code. Section 1103(g) of the Code provides that any bank holding company may elect, for the purposes of part VIII
of subchapter O of Chapter 1 of the Code, to have the
determination of whether property is "prohibited
property" or is property eligible to be distributed without recognition of gain under section 1101(b)(1) of the
Code, made under the BHC Act as if the Act did not
contain the proviso of section 4(a)(2). First has represented that it will make such an election prior to the
consummation of the proposed divestiture.
4. First has committed to the Board that no officer,
director or employee with policy-making functions of
First or any of its subsidiaries (including honorary or
advisory directors) will hold any such position with
New Corporation or any of its subsidiaries. First has
further committed that all such interlocking relationships that now exist between First and Bank will be
terminated.
On the basis of the foregoing information, it is hereby certified that:
173
(A) First is a qualified bank holding corporation
within the meaning of subsection (b) of section 1103 of
the Code, and satisfies the requirements of that subsection;
(B) The shares of Bank that First proposes to exchange for shares of New Corporation are all or part of
the property by reason of which First controls (within
the meaning of section 2(a) of the BHC Act) a bank or
bank holding company, and
(C) exchange of the shares of Bank for the shares of
New Corporation and the distribution to the shareholders of First of the shares of New Corporation are
necessary or appropriate to effectuate the policies of
the BHC Act.
This certification is based upon the representations
and commitments made to the Board by First and upon the facts set forth above. In the event the Board
should hereafter determine that facts material to this
certification are otherwise than as represented by
First, or that First has failed to disclose to the Board
other material facts or to fulfill any commitments made
to the Board in connection herewith, it may revoke
this certification.
By order of the Board of Governors acting through
its General Counsel, pursuant to delegated authority
(12 C.F.R.§ 265.2(b)(3), effective January 24, 1980.
(Signed)
[SEAL]
E. A L L I S O N ,
Secretary of the Board.
THEODORE
ORDERS APPROVED UNDER BANK HOLDING COMPANY ACT
By the Board of Governors
During January 1980 the Board of Governors approved the applications listed below. Copies are available upon
request to Publications Services, Division of Support Services, Board of Governors of the Federal Reserve System, Washington, D.C. 20551.
Section 3
Applicant
Fannin Bancshares, Inc., Houston, Texas
Green River Company, Green River,
Wyoming
Seaway Bancshares, Inc., Chicago, Illinois
Western Bancorporation, Houston, Texas
Bank(s)
Fannin Bank,
Houston, Texas
First National Bank of Green River,
Green River, Wyoming
Seaway National Bank of Chicago,
Chicago, Illinois
Western Bank,
Houston, Texas
Board action
(effective
date)
January 11,1980
January 25,1980
January 14,1980
January 18,1980
A 174
Federal Reserve Bulletin • February 1980
By Federal Reserve Banks
Recent applications have been approved by the Federal Reserve Banks as listed below. Copies of the orders are
available upon request to the Reserve Banks.
Section 3
Applicant
Banc One Corporation,
Columbus, Ohio
Beutler, Inc.,
Ness City, Kansas
Cattle Crossing, Inc.,
Seward, Nebraska
F & M Bank Shares, Inc.,
Hennessey, Oklahoma
Falmouth Bancorporation,
Falmouth, Kentucky
Illinois Holding Company,
Sherrard, Illinois
First Forest Park Corporation,
Forest Park, Illinois
First Naperville Bancorporation, Inc.,
Naperville, Illinois
First National Charter Corporation,
San Antonio Bancshares, Inc.,
San Antonio, Texas
Lakota Bank Holding Company, Inc.,
Lakota, North Dakota
Leigh Corporation,
Leigh, Nebraska
McGregor Bancshares, Inc.,
McGregor, Minnesota
Manco, Inc.,
Mancos, Colorado
MansuraBancshares, Inc., Mansura,
Illinois
Nekoosa Port Edwards
Bancorporation, Nekoosa,
Wisconsin
Peoples Bancshares, Inc., Van Buren,
Arkansas
Trust Company of Georgia, Atlanta,
Georgia
United Bank Corporation of New
York, Albany, New York
Bucklin Bankshares, Inc., Bucklin,
Kansas
Bank(s)
The Pomeroy National Bank,
Pomeroy, Ohio
The First State Bank,
Ness City, Kansas
The Cattle National Bank of
Seward,
Seward, Nebraska
The Farmers and Merchants
National Bank of Hennessey,
Hennessey, Oklahoma
The Falmouth Deposit Bank,
Falmouth, Kentucky
Farmers State Bank of
Sherrard,
Sherrard, Illinois
Forest Park National Bank,
Forest Park, Illinois
The First Bank, Naperville,
Naperville, Illinois
Farmers Savings Bank,
Marshall, Missouri
Bank of San Antonio,
San Antonio, Texas
State Bank of Lakota,
Lakota, North Dakota
Bank of Leigh,
Leigh, Nebraska
State Bank of McGregor,
McGregor, Minnesota
Mancos State Bank,
Mancos, Colorado
Mansura State Bank, Mansura,
Louisiana
Nekoosa Port Edwards State
Bank, Nekoosa, Wisconsin
Peoples Bank & Trust
Company, Van Buren,
Arkansas
Citizens and Southern Bank of
Rockdale, Conyers,
Colorado
Peninsula National Bank,
Cedarhurst, New York
The Farmers State Bank of
Bucklin, Kansas, Bucklin,
Kansas
Reserve
Bank
Effective
date
Cleveland
January 7,1980
Kansas City
January 4,1980
Kansas City
January 3,1980
Kansas City
January 3, 1980
Cleveland
January 4, 1980
Chicago
January 11,1980
Chicago
December 31,1979
Chicago
December 28, 1979
Kansas City
January 15,1980
Dallas
January 7, 1980
Minneapolis
January 4, 1980
Kansas City
December 28, 1979
Minnesota
January 21,1980
Kansas City
January 17,1980
Atlanta
January 21, 1980
Chicago
January 4,1980
St. Louis
January 18,1980
Atlanta
January 23,1980
New York
January 8,1980
Kansas City
January 25, 1980
Legal Developments
175
Section 3—Continued
Reserve
Bank
Bank(s)
Applicant
Elsie, Inc., Elsie, Nebraska
First Denham Bancshares, Inc.,
Denham Springs, Louisiana
First of Chadron Bank Corporation,
Chadron, Nebraska
First National Boston Corporation,
Boston, Massachusetts
Louisburg Bancshares, Inc.,
Louisburg, Kansas
Midlantic Banks Inc., West Orange,
New Jersey
Roy all Financial Corporation,
Palestine, Texas
Security Financial Services, Inc.,
Sheboygan, Wisconsin
Walker Bancshares Corp.,
Crawfordsville, Iowa
Wolfe City Bancshares, Inc., Wolfe
City, Texas
Commercial State Bank, Elsie,
Nebraska
First National Bank of Denham
Springs, Denham Springs,
Louisiana
The First National Bank of
Chadron, Chadron,
Nebraska
Pittsfield National Bank,
Pittsfield, Massachusetts
The Bank of Louisburg,
Louisburg, Kansas
Atlantic National Bank,
Atlantic City, New Jersey
The Royall National Bank of
Palestine, Palestine, Texas
Eldorado State Bank,
Eldorado, Wisconsin
Walker State Bank, Walker,
Iowa
The Wolfe City National Bank,
Wolfe City, Texas
Effective
date
Kansas City
January 24, 1980
Atlanta
January 21,1980
Kansas City
January 24,1980
Boston
January 28, 1980
Kansas City
January 25,1980
New York
January 28,1980
Dallas
January 28, 1980
Chicago
January 28, 1980
Chicago
January 2, 1980
Dallas
January 28,1980
Sections 3 and 4
Applicant
First Tahlequah Corp.,
Tahlequah, Oklahoma
Nonbanking
company
(or activity)
Bank(s)
First National Bank,
Tahlequah, Oklahoma
Credit related
insurance
activities
Reserve
Bank
Effective
date
Kansas City
January 17, 1980
Section 4
Applicant
First Atlantic Corporation, Atlanta,
Georgia
U.S. Bancorp, Portland, Oregon
Nonbanking
company
(or activity)
Underwriting of credit life and
disability insurance
State Finance & Thrift
Company, Inc., Logan, Utah
Reserve
Bank
Effective
date
Atlanta
January 10,1980
San Francisco
January 4,1980
A 176
Federal Reserve Bulletin • February 1980
PENDING CASES INVOLVING THE BOARD OF GOVERNORS
Does not include suits against the Federal Reserve
Banks in which the Board of Governors is not named a
party.
American Trust Co. of Hawaii, et al., v. Board of Governors, filed January 1980, U.S.D.C. for the District
of Columbia.
Boggs, et al. v. Board of Governors, filed October
1979, U.S.C.A. for the Eighth Circuit.
Independent Bank Corporation v. Board of Governors, filed October 1979, U.S.C.A. for the Sixth Circuit.
Wiley v. United States, et al., filed September 1979,
U.S.D.C. for the District of Columbia.
County National Bancorp oration and TGB Co. v.
Board of Governors, filed September 1979,
U.S.C.A. for the Eighth Circuit.
State of Indiana v. The United States of America, et
al., filed September 1979, U.S.D.C. for the District
of Columbia.
Edwin F. Gordon v. Board of Governors, et al., filed
August 1979, U.S.D.C. for the Northern District of
Georgia.
Edwin F. Gordon v. Board of Governors, et al., filed
August 1979, U.S.C.A. for the Fifth Circuit.
American Bankers Association v. Board of Governors,
et al., filed August 1979, U.S.D.C. for the District of
Columbia.
Gregory v. Board of Governors, filed July 1979,
U.S.D.C. for the District of Columbia.
Donald W. Riegel, Jr. v. Federal Open Market Committee, filed July 1979, U.S.D.C. for the District of
Columbia.
Connecticut Bankers Association, et al., v. Board of
Governors, filed May 1979, U.S.C.A. for the District of Columbia.
Ella Jackson et al., v. Board of Governors, filed May
1979, U.S.C.A. for the Fifth Circuit.
Memphis Trust Company v. Board of Governors, filed
May 1979, U.S.C.A. for the Sixth Circuit.
Independent Insurance Agents of America, et al., v.
Board of Governors, filed May 1979, U.S.C.A. for
the District of Columbia.
Independent Insurance Agents of America, et al., v.
Board of Governors, filed April 1979, U.S.C.A. for
the District of Columbia.
Independent Insurance Agents of America, et al., v.
Board of Governors, filed March 1979, U.S.C.A. for
the District of Columbia.
Credit and Commerce American Investment, et al., v.
Board of Governors, filed March 1979 U.S.C.A. for
the District of Columbia.
Consumers Union of the United States, v. G. William
Miller, et al., filed December 1978, U.S.D.C. for the
District of Columbia.
Manchester-Tower Grove Community Organization!
ACORN v. Board of Governors, filed September
1978, U.S.C.A. for the District of Columbia.
Independent Bankers Association of Texas v. First
National Bank in Dallas, et al., filed July 1978,
U.S.D.C. for the Northern District of Texas.
Mid-Nebraska Bancshares, Inc. v. Board of Governors, filed July 1978, U.S.C.A. for the District of
Columbia.
Security Bancorp and Security National Bank v.
Board of Governors, filed March 1978, U.S.C.A. for
the Ninth Circuit.
Vickars-Henry
Corp. v. Board of Governors,
filed
De-
cember 1977, U.S.C.A. for the Ninth Circuit.
Investment Company Institute v. Board of Governors,
filed September 1977, U.S.D.C. for the District of
Columbia.
Roberts Farms, Inc. v. Comptroller of the Currency,
etal., filed November 1975, U.S.D.C. for the Southern District of California.
1
Financial and Business Statistics
CONTENTS
Domestic Financial
Statistics
WEEKLY REPORTING COMMERCIAL BANKS
A3 Monetary aggregates and interest rates
A4 Factors affecting member bank reserves
A5 Reserves and borrowings of member banks
A6 Federal funds transactions of money market
banks
Assets and liabilities
A20 All reporting banks
A21
Banks with assets of $ 1 billion or more
All
Banks in New York City
A23 Balance sheet memoranda
A24 Commercial and industrial loans
POLICY INSTRUMENTS
A24 Major nondeposit funds of commercial banks
A25 Gross demand deposits of individuals,
partnerships, and corporations
A8 Federal Reserve Bank interest rates
A9 Member bank reserve requirements
A10 Maximum interest rates payable on time and
savings deposits at federally insured institutions
A11 Federal Reserve open market transactions
FINANCIAL
MARKETS
A12 Condition and Federal Reserve note statements
A13 Maturity distribution of loan and security
holdings
A25 Commercial paper and bankers dollar
acceptances outstanding
A26 Prime rate charged by banks on short-term
business loans
A26 Terms of lending at commercial banks
All Interest rates in money and capital markets
A28 Stock market—Selected statistics
MONETARY AND CREDIT AGGREGATES
A29 Savings institutions—Selected assets and
liabilities
FEDERAL RESERVE
BANKS
A13 Bank debits and deposit turnover
A14 Money stock measures and components
A15 Aggregate reserves and deposits of member
banks
A15 Loans and investments of all commercial banks
COMMERCIAL BANK ASSETS AND LIABILITIES
A16 Last-Wednesday-of-month series
A17 Call-date series
A18 Detailed balance sheet, September 30, 1978
FEDERAL FINANCE
A30
A31
A32
A32
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
A33 U.S. government marketable securitiesOwnership, by maturity
A34 U.S. government securities dealers—
Transactions, positions, and financing
A35 Federal and federally sponsored credit
agencies—Debt outstanding
A2
Federal Reserve Bulletin • February 1980
SECURITIES
CORPORATE
MARKETS
FINANCE
International
AND
A36 New security issues—State and local
governments and corporations
A37 Open-end investment companies—Net sales and
asset position
A37 Corporate profits and their distribution
A38 Nonfinancial corporations—Assets and liabilities
A38 Business expenditures on new plant and
equipment
A39 Domestic finance companies—Assets and
liabilities; business credit
REAL
A40 Mortgage markets
A41 Mortgage debt outstanding
INSTALLMENT
OF
U.S. international transactions—Summary
U.S. foreign trade
U.S. reserve assets
Foreign branches of U.S. banks—Balance sheet
data
A58 Selected U.S. liabilities to foreign official
institutions
REPORTED
BY BANKS
IN THE UNITED
FUNDS
A44 Funds raised in U.S. credit markets
A45 Direct and indirect sources of funds to credit
markets
Liabilities to and claims on foreigners
Liabilities to foreigners
Banks' own claims on foreigners
Banks' own and domestic customers' claims on
foreigners
A62 Banks' own claims on unaffiliated foreigners
A63 Claims on foreign countries—Combined
domestic offices and foreign branches
SECURITIES
HOLDINGS
AND
TRANSACTIONS
A64 Marketable U.S. Treasury bonds and n o t e s Foreign holdings and transactions
A64 Foreign official assets held at Federal Reserve
Banks
A65 Foreign transactions in securities
REPORTED BY NONBANKING
ENTERPRISES
IN THE UNITED
Domestic Nonfinancial
BUSINESS
STATES
Statistics
A46 Nonfinancial business activity—Selected
measures
A46 Output, capacity, and capacity utilization
A47 Labor force, employment, and unemployment
A48 Industrial production—Indexes and gross value
A50 Housing and construction
A51 Consumer and producer prices
A52 Gross national product and income
A53 Personal income and saving
STATES
CREDIT
A42 Total outstanding and net change
A43 Extensions and liquidations
FLOW
A54
A55
A55
A56
A58
A59
A61
A62
ESTATE
CONSUMER
Statistics
A66 Liabilities to unaffiliated foreigners
A67 Claims on unaffiliated foreigners
INTEREST
AND EXCHANGE
RATES
A68 Discount rates of foreign central banks
A68 Foreign short-term interest rates
A68 Foreign exchange rates
A69 Guide to Tabular Presentation and
Statistical Releases
Domestic Financial Statistics
1.10
A3
MONETARY AGGREGATES AND INTEREST RATES
1979
1979
Item
Q1
Q2
Q3
Q4
Aug.
Sept.
Oct.
Nov.
Dec.
Monetary and credit aggregates
(annual rates of change, seasonally adjusted in percent)1
1
2
3
4
Member bank reserves
Total
Required
Nonborrowed 2
Monetary base
5
6
7
8
9
Concepts of money and liquid assets3
M-1A
M-1B
M-2
M-3
L
Time and savings deposits
Commercial banks
10 Total
11 Savings4
12 Small denomination time5
13 Large-denomination time6
14 Thrift institutions7
15 Total loans and investments at commercial banks8
-2.3
-2.2
-2.8
5.9
-3.6
-3.5
-7.5
4.8
5.1
4.8
7.0
9.3
12.4
11.6
6.8
9.5
6.7
6.4
9.5
11.2
11.1
12.0
3.8
12.2
17.4
15.4
-2.3
10.2
6.3
6.9
9.9
5.4
16.9
12.6
30.6
7.8
0.2
4.8
6.3
7.9
10.3
7.8
10.7
10.2
8.8
13.1
8.8
10.1
10.3
10.3
11.7
4.7
5.3
7.2
9.8
n.a.
7.3
8.6
10.6
11.6
10.3
6.9
7.9
8.2
13.2
16.4
1.6
2.2
6.0
9.4
6.9
5.2
4.4
5.8
7.3
5.3
6.2
7.5
7.4
6.5
n.a.
20.9
-17.0
24.8
19.8
8.3
13.3
6.5
-9.7
20.4
-4.8
7.4
11.9
13.7
-1.5
14.4
9.5
7.4
15.8
25.4
-21.0
24.4
29.5
6.7
3.4
-1.7
-1.9
15.3
18.2
7.4
11.6
16.8
-13.3
19.1
41.9
7.0
21.7
28.4
-37.7
35.0
26.4
6.2
-.5
27.8
-12.5
14.1
-2.2
6.3
4.1
1979
Q1
Q2
20.8
-25.3
26.0
35.9
6.6
6.6 r
1979
Q3
Q4
Sept.
Oct.
1980
Nov.
Dec.
Jan.
Interest rates (levels, percent per annum)
16
17
18
19
Short-term rates
Federal funds 9
Federal Reserve discount10
Treasury bills (3-month market yield)11
Commercial paper (3-month) 111 *
Long-term rates
Bonds
20 U.S. government13
21 State and local government14
22 Aaa utility (new issue)15
23 Conventional mortages16
10.07
9.50
9.38
10.04
10.18
9.50
9.38
9.85
10.94
10.21
9.67
19.64
13.58
11.92
11.84
13.35
11.43
10.70
10.26
11.63
13.77
11.77
11.70
13.23
13.18
12.00
11.79
13.57
13.78
12.00
12.04
13.24
13.82
12.00
12.00
13.04
9.03
6.37
9.58
10.33
9.08
6.22
9.66
10.35
9.03
6.28
9.64
11.13
10.18
7.20
11.21
12.38
9.21
6.52
9.93
11.35
9.99
7.08
10.97
12.15
10.37
7.30
11.42
12.50
10.18
7.22
11.25
12.50
10.65
7.35
11.73
12.80
1. Unless otherwise noted, rates of change are calculated from average amounts
outstanding in preceding month or quarter. Growth rates for member bank reserves
are adjusted for discontinuities in series that result from changes in Regulations
D and M.
2. Includes total reserves (member bank reserve balances in the current week
Elus vault cash held two weeks earlier); currency outside the U.S. Treasury, Federal
Reserve Banks and the vaults of commercial banks; and vault cash of nonmember
banks.
3. M-l A: Averages of daily figures for (1) demand deposits at all commercial
banks other than those due to domestic banks, the U.S. government, and foreign
banks and official institutions less cash items in the process of collection and
Federal Reserve float; and (2) currency outside the Treasury, Federal Reserve
banks, and the vaults of commercial banks.
M-1B: M-1A plus NOW and ATS accounts at banks and thrift institutions,
credit union share draft accounts, and demand deposits at mutual savings banks.
M-2: M-1B plus savings and small denomination time deposits at all depositary
institutions, overnight RPs at commercial banks, overnight Eurodollars held by
U.S. residents other than banks at Caribbean branches of member banks, and
money market mutual fund shares.
M-3: M-2 plus large denomination time deposits at all depositary institutions
and term RPs at commercial banks and savings and loan associations.
L: M-3 plus other liquid assets such as term Eurodollars held by U.S. residents
other than banks, bankers acceptances, commercial paper. Treasury bills and other
liquid Treasury securities and U.S. savings bonds.
4. Savings deposits exclude NOW and ATS accounts at commercial banks.
5. Small time deposits are those issued in amounts of less than $100,000.
6. Large time deposits are those issued in amounts of $100,000 or more.
7. Savings and loan associations, mutual savings banks, and credit unions.
8. Quarterly changes calculated from figures shown in table 1.23.
9. Seven-day averages of daily effective rates (average of the rates on a given
date weighted by the volume of transactions at those rates).
10. Rate for the Federal Reserve Bank of New York.
11. Quoted on a bank-discount basis.
12. Beginning Nov. 1977. unweighted average of offerintg rates quoted by at
least five dealers. Previously, most representative rate quoted by these dealers.
Before Nov. 1979, data shown are for 90- to 119-day maturity.
13. Market yields adjusted to a 20-year maturity by the U.S. Treasury.
14. Bond Buyer series for 20 issues of mixed quality.
15. Weighted averages of new publicly offered bonds rates Aaa. Aa and A by
Moody's Investors Service and adjusted to an Aaa basis. Federal Reserve compilations.
16. Average rates on new commitments for conventional first mortgages on new
homes in primary markets, unweighted and rounded to nearest 5 basis points, from
Dept. of Housing and Urban Development.
A4
1.11
DomesticNonfinancialStatistics • February 1980
FACTORS AFFECTING MEMBER BANK RESERVES
Millions of dollars
Monthly averages of daily
figures
Weekly averages of daily figures for week-ending
Factors
Nov.P
Dec.P
Jan./7
1 Reserve Bank credit outstanding
136,696
140,008
138,855
139,051
141,347
143,400
2 U.S. government securities 1
3
Bought outright
4
Held under repurchase agreements
5 Federal agency securities
6
Bought outright
7
Held; under repurchase agreements
115,240
114,815
425
8,363
117,855
117,493
362
8,383
8,216
167
117,538
117,326
212
8,353
142
117,821
117,195
626
8,455
8,218
237
118,393
117,328
1,065
8,401
8,216
185
119,035
117,496
1,539
8,805
8,216
589
116
1,908
6,119
4,950
353
1,454
6,499
5,426
104
1,264
5,825
5,424
31
1,684
6,128
5,318
0
0
1,224
6,857
5,667
826
1,431
7,682
5,622
732
7,653
5,628
1,226
6,135
5,324
61
1,197
5,327
5,357
11,159
1,800
11,112
1,800
12,913
11,156
2,064
12,978
11,112
12,828
1,800
12,911
11,112
1,800
12,938
11,112
1,800
12,947
11,112
1,800
12,956
11,172
1,800
12,973
11,172
1,800
12,989
121,397
397
123,836
426
122,934
441
123,682
431
124,738
430
125,475
426
124,841
432
123,368
437
122,060
444
3,050
353
294
2,963
318
355
3,110
331
434
2,640
326
332
3,095
266
316
3,607
351
820
2,812
3,281
283
321
3,073
320
346
Dec. 26P
Jan. 2P
Jan. 16p
Jan. 23p
141,018
139,613
138,118
118,789
118,789
118,713
118,713
8,216
8,216
8,216
8,216
117,695
117,323
372
8,481
8,216
265
Jan. 9P
SUPPLYING RESERVE FUNDS
8
9
10
11
Acceptances
Loans
Float
Other Federal Reserve assets
12 Gold stock
13 Special drawing rights certificate account
14 Treasury currency outstanding
8,221
8,216
137
0
0
0
0
ABSORBING RESERVE FUNDS
15 Currency in circulation
16 Treasury cash holdings
Deposits, other than member bank reserves, with
Federal Reserve Banks
17 Treasury
18 Foreign
19 Other
20 Other Federal Reserve liabilities and capital
21 Member bank reserves with Federal Reserve
Banks
372
432
4,894
5,349
5,080
5,149
5,445
5,402
4,741
5,006
5,166
32,098
32,585
32,724
32,314
32,908
33,177
33,264
32,862
32,671
Wednesday figures
End-of-month figures
1980
1979
Jan. 2P
Jan. 9P
137,836
146,060
139,987
136,420
140,386
113,057
112,856
201
8,331
117,639
117,639
0
115
1,122
8,216
0
114,774
114,774
0
8,216
8,216
0
118,610
8,216
119,070
116,406
2,664
9,338
8,216
0
1,561
6,690
5,554
415
1,982
8,030
6,021
1,078
2,060
8,777
5,737
0
1,250
7,577
5,305
0
1,740
6,393
5,297
327
1,116
5,831
5,379
11,172
2,968
13,006
11,112
1,800
12,937
11,112
1,800
12,947
11,112
1,800
12,947
11,172
1,800
12,970
11,172
1,800
12,979
11,172
1,800
12,989
125,473
426
121,004
460
124,449
431
125,595
430
125,590
426
124,286
434
122,959
438
121,781
448
2,590
490
352
5,378
4,075
429
1,412
4,957
2,931
440
339
5,682
3,061
274
303
5,235
2,883
216
370
5,681
3,961
379
1,821
4,905
3,472
299
324
4,907
3,468
250
307
4,986
3,309
242
357
5,345
32,617
29,792
31,492
29,302
28,520
34,837
32,207
29,963
34,865
Nov.P
Dec.P
Dec. 19P
Dec. 26p
138,008
140,705
118,087
117,528
559
9,194
973
117,458
116,291
1,167
8,709
8,216
493
135,202
137,207
116,311
116,311
8,216
115,186
115,186
0
8,216
8,216
8,216
0
269
2,034
3,729
4,695
704
1,454
6,767
5,613
4,610
5,237
11,112
1,800
13,020
11,112
1,800
12,947
122,082
427
Jan. 16P
Jan. 23P
Jan. 30?
SUPPLYING RESERVE FUNDS
22 Reserve bank credit outstanding
1
23 U.S. government securities
24
Bought outright
25
Held under repurchase agreements
26 Federal agency securities
27
Bought outright
28
Held under repurchase agreements
29
30
31
32
Acceptances
Loans
Float
Other Federal Reserve assets
33 Gold stock
34 Special drawing rights certificate account
35 Treasury currency outstanding
8,221
8,216
116,950
1,660
9,123
8,216
907
ABSORBING RESERVE FUNDS
36 Currency in circulation
37 Treasury cash holdings
Deposits, other than member bank reserves, with
Feaeral Reserve Banks
38
Treasury
39
Foreign
40
Other
41 Other Federal Reserve liabilities and capital
42 Member bank reserves with Federal Reserve
Banks
1. Includes securities loaned—fully guaranteed by U.S. government securities
pledged with Federal Reserve Banks—and excludes (if any) securities sold and
scheduled to be bought back under matched sale-purchase transactions.
NOTE: For amounts of currency and coin held as reserves, see table 1.12
Member Banks
1.12
RESERVES AND BORROWINGS
A5
Member Banks
Millions of Dollars
Monthly averages of daily figures
Reserve classification
1979
1978
May
Dec.
All member banks
Reserves
At Federal Reserve Banks
Currency and coin
Total held 1
Required
Excess 1
Borrowings at Reserve Banks 2
6
Total
7
Seasonal
1
2
3
4
5
Large banks in New York City
8 Reserves held
9
Required
10
Excess
11 Borrowings 2
Large banks in Chicago
12 Reserves held
13
Required
14
Excess
15 Borrowings 2
Other large banks
16 Reserves held
17
Required
18
Excess
19 Borrowings 2
All other banks
20 Reserves held
21
Required
22
Excess
23 Borrowings 2
Edge corporations
24 Reserves held
25
Required
26
Excess
U.S. agencies and branches
27 Reserves held
28
Required
29
Excess
:
June
July
1980
Sept.
Aug.
Oct./'
NOV.P
Dec.P
Jan .P
31,158
10,330
41,572
41,447
125
30,208
10,044
40,382
40,095
287
29,822
10,154
40,105
39,884
221
30,191
10,552
40.900
40,710
190
30,006
10,523
40,687
40,494
193
29,986
10,726
40,868
40,863
5
31,599
10,681
42,423
42,002
421
32,098
10.740
42,979
42,770
209
32,585
11,323
44,063
43,560
503
32,724
12,318
45,217
44,902
315
874
134
1,777
173
1,396
188
1,179
168
1,097
177
1,344
169
2,022
161
1,908
141
1,454
81
1,264
74
7,120
7,243
-123
99
6,658
6,544
114
150
6,346
6,415
-69
78
6,605
6,586
19
97
6,408
6,427
-19
79
6,437
6,378
59
87
6,655
6,851
-196
183
6,695
6,932
-237
139
7,206
7,329
-123
63
7,781
7,758
23
32
1,907
1,900
7
10
1,730
1,712
18
60
1,726
1,697
29
64
1,709
1,713
-4
45
1,694
1,706
-12
6
1,654
1,760
-106
80
1,790
1,859
-69
136
1,869
1,950
-81
118
1,990
2,001
-11
79
2,021
2,059
-38
76
16,446
16,342
104
276
15,926
15,893
33
721
15,989
15,877
112
586
16,374
16,339
35
517
16,370
16,321
49
484
16,426
16,491
-65
600
16,519
16,796
-277
856
16,663
17,000
-337
804
17,336
17,369
-33
697
17,719
17,967
-248
642
16,099
15,962
137
489
16,068
15,946
122
846
16,044
15,895
149
668
16,212
16,072
140
520
16,215
16,040
175
528
16,351
16,234
117
577
16,495
16,424
71
847
16,496
16,420
76
847
16,621
16,539
82
615
16,843
16,779
64
514
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
90
72
18
308
287
21
333
302
31
336
314
22
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
185
181
4
26
20
6
29
25
4
Weekly averages of daily figures for week (in 1979 and 1980) ending
Nov. 28P
All member banks
Reserves
At Federal Reserve Banks
Currency and coin
Total held 1
Required
Excess 1
Borrowings at Reserve Banks 2
35
Total
36
Seasonal
30
31
32
33
34
Large banks in New York City
37 Reserves held
38
Required
39
Excess
.
40 Borrowings 2
Large banks in Chicago
41 Reserves held
42
Required
43
Excess
44 Borrowings 2
Other large banks
45 Reserves held
46
Required
47
Excess
48 Borrowings 2
All other banks
49 Reserves held
50
Required
51
Excess
52 Borrowings 2
Edge corporations
53 Reserves held
54
Required
55
Excess
U.S. agencies and branches
56 Reserves held
57
Required
58
Excess
Dec. 5P
Dec. 12 P
Dec. 26P
Jan.
IP
Jan. 9P
Jan. 16 P
Jan.
23P
Jan. 30P
32,341
10,542
43,022
42,887
135
32,436
11,038
43,614
43,379
235
31,752
11,772
43,668
43,082
586
32,314
11,341
43,816
43,697
119
32,908
10,984
44,056
43,560
496
33,177
11,429
44,767
44,217
550
33,264
11,359
44,807
44,568
239
32,862
13,506
46,539
45,988
551
32,671
12,482
45,325
45,082
243
32,242
12,251
44,665
44,386
279
2,021
136
1,819
100
1,291
80
1,684
83
1,224
80
1,431
64
732
61
1,226
74
1,197
78
1,821
87
6,669
6,779
-80
239
7,275
7,271
4
136
7,082
7,290
-208
7,439
7,506
-67
12
7,056
7,138
-82
90
7,547
7,464
83
129
7,383
7,752
-369
33
8,346
8,329
17
46
7,693
7,651
42
0
7,546
7,469
77
0
1,875
1,960
-85
424
1,940
2,005
-65
69
1,843
1,884
-41
178
1,967
2,054
-87
74
1,953
2,015
-62
21
2,131
2,066
65
111
1,967
2,089
-122
0
2,143
2,102
41
0
2,002
2,045
-43
0
2,093
2,009
84
236
16,969
17,197
-228
601
16,946
17,261
-315
814
17,181
17,245
-64
584
16,980
17,357
-377
990
17,630
17,414
216
464
17,365
17,603
-238
663
17,497
17,769
-272
318
18,202
18,298
-96
756
17,881
18,134
-253
650
17,723
17,849
-126
883
16,567
16,565
2
757
16,627
16,518
109
800
16,301
16,342
-41
529
16,563
16,471
92
608
16,834
16,676
158
649
16,873
16,739
134
528
16,619
16,598
21
381
17,003
16,866
137
424
16,883
16,936
-53
547
16,851
16,774
77
702
310
298
12
304
286
18
349
298
51
319
302
17
336
307
29
347
315
32
338
329
9
376
367
9
315
281
34
338
277
61
91
88
3
39
38
1
31
23
8
33
7
26
14
10
4
14
30
-16
28
31
-3
28
26
2
37
35
2
31
8
23
1. Adjusted to include waivers of penalties for reserve deficiencies in accordance
with Board policy, effective Nov. 19, 1975, of permitting transitional relief on a
graduated basis over a 24-month period when a nonmember bank merged into an
existing m e m b e r b a n k , or when a n o n m e m b e r bank joins the Federal
Dec. 19 P
Reserve System. For weeks for which figures are preliminary, figures by class of
bank do not add to total because adjusted data by class are not available.
2. Based on closing figures.
A6
1.13
DomesticNonfinancialStatistics • February 1980
FEDERAL FUNDS TRANSACTIONS
Money Market Banks
Millions of dollars, except as noted
1979, week ending Wednesday
1980, week ending Wednesday
Type
Dec. 5
Dec. 12
Dec. 19
Dec. 26
Jan. 2
Jan. 9
Jan. 16
Jan. 23
Jan. 30
Total, 46 banks
Basic reserve position
1 Excess reserves1
46
77
32
186
324
-15
LESS:
2 Borrowings at Federal Reserve
Banks
3 Net interbank federal funds
transactions
EQUALS: Net surplus, or deficit ( - )
4 Amount
5 Percent of average required
reserves
6
7
8
9
10
Interbank federal funds transactions
Gross transactions
Purchases
Sales
Two-way transactions 2
Net transactions
Purchases of net buying banks
Sales of net selling banks
Related transactions with U.S.
government securities dealers
11 Loans to dealers 3
12 Borrowings from dealers 4
13 Net loans
26
75
63
489
332
362
128
404
130
289
181
624
18,871
24,250
22,439
21,490
22,206
24,759
25,712
24,209
22,754
-19,314
-24,504
-22,770
-21,433
-22,285
-24,904
-25,975
-24,314
-23,315
102.8
130.8
119.0
114.6
116.2
126.6
126.4
124.4
121.8
27,432
8,561
6,113
31,488
7,239
6,584
29,642
7,203
6,633
28,792
7,301
7,039
31,238
9,032
7,672
32,300
7,541
6,941
32,694
6,982
6,782
31,086
6,878
5,960
29,442
6,688
6,300
21,318
2,448
24,904
655
23,009
599
21,753
262
23,567
1,360
25,359
559
25,912
200
25,127
918
23,142
388
2,676
2,383
293
2,322
1,515
808
2,347
1,637
710
3,036
1,732
1,314
2,563
2,744
-181
2,247
1,372
875
2,562
1,754
807
2,324
1,811
513
1,998
2,261
-263
-43
53
46
15
8 banks in New York City
Basic reserve position
14 Excess reserves1
48
87
41
40
123
LESS:
15 Borrowings at Federal Reserve
Banks
16 Net interbank federal funds
transactions
EQUALS: Net surplus, or deficit ( - )
17 Amount
18 Percent of average required
reserves
19
20
21
22
23
Interbank federal funds transactions
Gross transactions
Purchases
Sales
Two-way transactions 2
Net transactions
Purchases of net buying banks
Sales of net selling banks
Related transactions with U.S.
government securities dealers
24 Loans to dealers 3
25 Borrowings from dealers 4
26 Net loans
71
0
0
83
129
33
36
0
0
3,598
6,890
4,849
4,617
5,592
6,460
6,846
6,855
5,516
-3,621
-6,803
-4,807
-4,660
-5,958
-6,536
-6,829
-6,809
-5,501
55.5
103.7
71.0
72.8
88.6
93.2
90.6
98.3
81.7
6,184
2,586
1,664
8,775
1,885
1,885
7,084
2,236
2,014
6,438
1,822
1,822
8,018
2,066
2,066
8,215
1,754
1,754
8,322
1,476
1,476
8,071
1,216
1,216
7,181
1,665
1,666
4,520
923
6,890
0
5,070
222
4,617
0
5,952
0
6,461
0
6,846
0
6,855
0
5,516
0
1,874
559
1,315
1,594
545
1,049
1,584
694
890
2,074
818
1,256
1,765
514
1,251
1,446
502
944
1,785
760
1,025
1,583
674
909
1,401
985
415
-27
29
47
38 banks outside New York City
Basic reserve position
27 Excess reserves1
-2
-9
-9
146
201
28
LESS:
28 Borrowings at Federal Reserve
Banks
29 Net interbank federal funds
transactions
EQUALS: Net surplus, or deficit ( - )
30 Amount
31 Percent of average required
reserves
32
33
34
35
36
Interbank federal funds transactions
Gross transactions
Purchases
Sales
Two-way transactions 2
Net transactions
Purchases of net buying banks
Sales of net selling banks
Related transactions with U.S.
government securities dealers
37 Loans to dealers 3
38 Borrowings from dealers 4
39 Net loans
For notes see end of table.
418
332
362
45
275
97
254
181
624
15,274
17,360
17,591
16,874
16,254
18,299
18,866
17,353
17,238
-15,694
-17,701
- 17,963
-16,773
-16.328
- 18,368
-19,146
-17,505
-17,815
127.8
145.3
145.4
136.4
131.1
145.2
147.2
138.6
143.5
21,248
5,974
4,450
22,713
5,354
4,699
22,558
4,967
4,619
22,353
5,480
5,217
23,220
6,966
5.606
24,085
5,786
5.187
24,372
5,506
5,306
23,015
5,662
4,743
22,261
5 023
4,635
16,798
1,525
18,014
655
17,399
348
17,136
262
17,615
1.360
18,899
599
19.066
200
18,272
918
17,626
388
802
1,824
-1,021
728
969
-241
762
943
-180
962
905
57
798
2.230
-1,432
801
870
-69
777
994
-217
741
1,136
-396
597
1,276
-678
Federal Funds
1.13
A7
Continued
Millions of dollars, except as noted
1980, week ending Wednesday
1979, week ending Wednesday
Type
Dec. 12
Dec. 5
Dec. 19
Jan. 9
Jan. 2
Dec. 26
Jan. 16
Jan. 30
Jan. 23
5 banks in City of Chicago
Basic reserve position
40 Excess reserves1
18
-1
-2
1
90
4
-18
0
15
LESS:
41 Borrowings at Federal Reserve
Banks
42 Net interbank federal funds
transactions
EQUALS: Net surplus, or deficit ( - )
43 Amount
44 Percent of average required
reserves
45
46
47
48
49
Interbank federal funds transactions
Gross transactions
Purchases
Sales
Two-way transactions 2
Net transactions
Purchases of net buying banks
Sales of net selling banks
Related transactions with U.S.
government securities dealers
50 Loans to dealers 3
51 Borrowings from dealers 4
52 Net loans
56
164
43
11
100
0
0
0
236
7,304
7,281
7,171
7,375
8,114
7,798
8,121
7,824
7,906
-7,341
-7,446
-7,216
-7,385
-8,125
-7,795
-8,138
-7,824
-8,127
390.6
423.2
381.7
390.1
418.5
397.1
408.6
407.4
431.2
8,373
1,069
1,069
8,460
1,179
1,179
8,272
1,101
1,101
8,652
1,277
1,277
9.356
1,242
1,242
15,028
4,528
3,928
9,521
1,400
1,400
9,108
1,284
1,284
9,102
1,196
1,196
7,034
0
7,281
0
7,171
0
7,375
0
8,114
0
11,100
599
8,121
0
7,824
0
7,906
0
181
174
7
145
54
91
89
78
11
187
19
168
123
221
-98
678
840
-162
136
51
85
138
56
82
110
25
-9
29
32
77
32
33 other banks
Basic reserve position
53 Excess reserves1
-20
-7
-8
145
111
LESS:
54 Borrowings at Federal Reserve
Banks
55 Net interbank federal funds
transactions
EQUALS: Net surplus, or deficit ( - )
56 Amount
57 Percent of average required
reserves
58
59
60
61
62
Interbank federal funds transactions
Gross transactions
Purchases
Sales
Two-way transactions 2
Net transactions
Purchases of net buying banks
Sales of net selling banks
Related transactions with U.S.
government securities dealers
63 Loans to dealers 3
64 Borrowings from dealers 4
65 Net loans
362
168
320
35
175
97
254
181
389
7,970
10,079
10,420
9,499
8,140
10,501
10,745
9,529
9,332
-8,352
-10,255
-10,747
-9,388
-8,203
-10,574
-11,008
-9,681
-9,688
80.3
98.4
102.7
90.2
78.0
98.9
100.0
90.4
92.0
12,875
4,906
3,381
14,253
4,174
3,519
14,286
3,866
3,518
13,702
4,203
3,940
13,864
5,725
4,364
9,097
1,259
1,259
14,851
4,106
3,906
13,907
4,378
3,459
13,159
3,826
3,439
9,495
1,525
10,734
655
10,768
348
9,762
262
9,500
1,360
7,798
0
10,945
200
10,448
918
9,720
388
621
1,650
-1,028
583
915
-332
674
865
-191
775
886
-111
675
2,009
-1,334
123
31
92
641
944
-303
603
1,081
-474
488
1,198
-711
1. Based on reserve balances, including adjustments to include waivers of penalties for reserve deficiencies in accordance with changes in policy of the Board
of Governors effective Nov. 19, 1975.
2. Derived from averages for individual banks for entire week. Figure for each
bank indicates extent to which the bank's average purchases and sales are offsetting.
3. Federal funds loaned, net funds supplied to each dealer by clearing banks,
repurchase agreements (purchase from dealers subject to resale), or other lending
arrangements.
4. Federal funds borrowed, net funds acquired from each dealer by clearing
banks, reverse repurchase agreements (sales of securities to dealers subject to
repurchase), resale agreements, and borrowings secured by U.S. government or
other securities.
NOTE. Weekly averages of daily figures. For description of series, see August
1964 BULLETIN, pp. 944-53. Back data for 46 banks appear in the Board's Annual
Statistical Digest, 1971-1975, table 3.
A8
1.14
DomesticNonfinancialStatistics • February 1980
FEDERAL RESERVE BANK INTEREST RATES
Percent per annum
Current and previous levels
Loans to member banks
Loans to all others
under sec. 13, last par.2
Under sec. 10(b)'
Under sees. 13 and 13a3
Federal Reserve
Bank
Special rate4
Regular rate
Rate on
1/31/80
Effective
date
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
12
12
12
12
12
12
10/10/79
10/8/79
10/8/79
10/8/79
10/8/79
10/9/79
11
11
11
11
11
11
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
12
12
12
12
12
12
10/9/79
10/8/79
10/8/79
10/9/79
10/9/79
10/8/79
11
11
11
11
11
11
Previous
rate
Rate on
1/31/80
Effective
date
Previous
rate
i2k>
10/10/79
10/8/79
10/8/79
10/8/79
10/8/79
10/9/79
l2Vi
\2Vi
\2Vi
12 Vi
\2Vi
\2Vi
\2Vi
12 Vi
\2Vi
\2Yi
\2Vi
10/9/79
10/8/79
10/8/79
10/9/79
10/9/79
10/8/79
Rate on
1/31/80
Effective
date
UVi
UVi
\\Vi
IV/2
11 Vz
11 Vi
13
13
13
13
13
13
10/10/79
10/8/79
10/8/79
10/8/79
10/8/79
10/9/79
11 '/2
13
13
13
13
13
13
10/9/79
10/8/79
10/8/79
10/9/79
10/9/79
10/8/79
ll l /2
UVi
\\Vi
\\Vl
11 Vi
Previous
rate
Rate on
1/31/80
Effective
date
12
12
12
12
12
12
15
15
15
15
15
15
10/10/79
10/8/79
10/8/79
10/8/79
10/8/79
10/9/79
14
14
14
14
14
14
12
12
12
12
12
12
15
15
15
15
15
15
10/9/79
10/8/79
10/8/79
10/9/79
10/9/79
10/8/79
14
14
14
14
14
14
Previous
rate
Range of rates in recent years 5
Effective date
In effect Dec. 31, 1970
1971— Jan.
Feb.
July
Nov.
Dec.
8
15
19
22
29
13
19
16
23
11
19
13
17
24
1973— Jan. 15
Feb. 26
Mar. 2
Apr. 23
May 4
11
18
June 11
15
Range
(or
level)—
All F.R.
Banks
F.R.
Bank
of
N.Y.
5^
5Vi
5V*-5Vi
5V4
5-51/4
5-51/4
5
3
5^4
5Va
5Vi
5
5
5
43/4
5
5
53
4 /4-5
4^/4
43/4-5
5
3
4 /4-5
43/4
3
4^-4 /4
3
4V2-4 /4
4 /4
43/4
4Vi
\Vi
4 Vi
5
5-5 Vi
5Yi 3
5
5Vi
5Vi
5Vi
3
5 kz-5 /4
53/4
3
5 /+-6
6
6-6Vi
6 Vi
5 /4
6
6
Effective d<
Range
(or
level)—
All F.R.
Banks
F.R.
Bank
of
N.Y.
7
7
IVi
IVi
1973— July 2
Aug. 14
23
1974— Apr. 25
30
Dec. 9
16
1975— Jan.
6
10
24
Feb. 5
7
Mar. 10
14
May 16
23
19
23
Nov. 22
26
1976— Jan.
6V2
6V2
1-1 Vi
IVI
IV1-8
3
8
7 /4-8
73/4
7 / — ^4
14 7 /
IV^V/A
3
m
8
83
7 /4
1977— Aug. 30
31
Sept. 2
Oct. 26
5l/4-53/4
5!/4-53/4
53/4
51/4
53/4
5^4
1978— Jan.
6-6 Vi
6 Vi
bVb-1
1
May
73/4
71/4
71/4
63/4
63/4
64
V
61/4
July
6
6
51/2-6
5h
5 Yi
5Vi
5^4
F.R.
Bank
of
N.Y.
73/4
6 /4~7!/4
63/4
6V4-63/4
61/4
6-61/4
6
51/4-5 Vi
Range
(or
level)—
All F.R.
Banks
Effective date
5
W
5^4
Aug.
Sept.
Oct.
Nov.
9
20
11
12
3
10
21
22
16
20
1
3
1979— July 20
Aug. 17
20
Sept. 19
21
Oct. 8
10
In effect Jan. 31, 1980
1. Advances secured to the satisfaction of the Federal Reserve Bank. Advances
secured by mortgages on 1- to 4-family residential property are made at the section
13 rate.
2. Advances to individuals, partnerships, or corporations other than member
banks secured by direct obligations of, or obligations fully guaranteed as to principal and interest by, the U.S. government or any agency thereof.
3. Discounts or eligible paper and advances secured by such paper or by
6
1-1 VI
6
6V2
6 Vi
1
1
7V4
73/4
71/4
73/4
8
8-8 Vi
8h
81^-9 Vi
9Vi
8
SVi
8 Vi
9 Vi
9V2
10
10-10 Vi
10 Vi
10^-11
11
11-12
12
10
10 Vi
10 Vi
11
11
12
12
m
12
12
U.S. government obligations or any other obligations eligible for Federal Reserve
Bank purchase.
4. Applicable to special advances described in section 201.2(e)(2) of Regulation
A.
5. Rates under sees. 13 and 13a (as described above). For description and earlier
data, see the following publications of the Board of Governors: Banking and
Monetary Statistics, 1914-1941 and 1941-1970; Annual Statistical Digest, 19711975, 1972-1976, and 1973-1977.
Policy Instruments
1.15
A9
MEMBER BANK RESERVE REQUIREMENTS1
Percent of deposits
Requirements in effect
January 31, 1979
Type of deposit, and deposit interval
in millions of dollars
Previous requirements
Effective date
Net demand2
0-2
2-10
10-100
100-400
Over 400
Time and savings2'3-4
Savings
Time 5
0-5, by maturity
30-179 days
180 days to 4 years
4 years or more ....
Over 5, by maturity
30-179 days
180 days to 4 years
4 years or more ....
7
9 Vi
Effective date
iVi
12/30/76
12/30/76
12/30/76
12/30/76
12/30/76
113/4
123/4
16V4
Percent
2/13/75
2/13/75
2/13/75
2/13/75
2/13/75
10
12
13
16 Vi
3 Vi
3
3 Vi
3
3
3/16/67
1/8/76
10/30/75
2Vi
1
3/2/67
3/16/67
3/16/67
12/12/74
1/8/76
10/30/75
6
1
10/1/70
12/12/74
12/12/74
Legal limits
Minimum
Net demand
Reserve city banks
Other banks
Time
Borrowings from foreign banks
1. For changes in reserve requirements beginning 1963, see Board's Annual
Statistical Digest, 1971-1975 and for prior changes, see Board's Annual Report for
1976, table 13.
2. (a) Requirement schedules are graduated, and each deposit interval applies
to that part of the deposits of each bank. Demand deposits subject to reserve
requirements are gross demand deposits minus cash items in process of collection
ana demand balances due from domestic banks.
(b) The Federal Reserve Act specifies different ranges of requirements for
reserve city banks and for other banks. Reserve cities are designated under a
criterion adopted effective Nov. 9, 1972, by which a bank having net demand
deposits of more than $400 million is considered to have the character of business
of a reserve city bank. The presence of the head office of such a bank constitutes
designation of that place as a reserve city. Cities in which there are Federal Reserve
Banks or branches are also reserve cities. Any banks having net demand deposits
of $400 million or less are considered to have the character of business of banks
outside of reserve cities and are permitted to maintain reserves at ratios set for
banks not in reserve cities. For details, see the Board's Regulation D.
(c) Effective Aug. 24, 1978, the Regulation M reserve requirements on net
balances due from domestic banks to their foreign branches and on deposits that
foreign branches lend to U.S residents were reduced to zero from 4 percent and
1 percent, respectively. The Regulation D reserve requirement on borrowings
from unrelated banks abroad was also reduced to zero from 4 percent.
10
7
3
0
22
14
10
22
(d) Effective with the reserve computation period beginning Nov. 16, 1978,
domestic deposits of Edge corporations are subject to the same reserve requirements as deposits of member banks.
3. Negotiable order of withdrawal (NOW) accounts and time deposits such as
Christmas and vacation club accounts are subject to the same requirements as
savings deposits.
4. The average reserve requirement on savings and other time deposits must be
at least 3 percent, the minimum specified by law.
5. Effective Nov. 2, 1978, a supplementary reserve requirement of 2 percent
was imposed on large time deposits of $100,000 or more, obligations of affiliates,
and ineligible acceptances.
Effective with the reserve maintenance period beginning Oct. 25, 1979, a marginal reserve requirement of 8 percent was added to managed liabilities in excess
of a base amount. Managed liabilities are defined as large time deposits. Eurodollar
borrowings, repurchase agreements against U.S. government and federal agency
securities, federal funds borrowings from nonmember institutions, and certain
other obligations. In general, the base for the marginal reserve requirement is
$100 million or the average amount of the managed liabilities held by a member
bank. Edge corporation, or family of U.S. branches and agencies of a foreign bank
for the two statement weeks ending Sept. 26, 1979.
NOTE. Required reserves must be held in the form of deposits with Federal
Reserve banks or vault cash.
A10
1.16
DomesticNonfinancialStatistics • February 1980
MAXIMUM INTEREST RATES PAYABLE on Time and Savings Deposits at Federally Insured Institutions
Percent per annum
Commerical banks
Type and maturity of deposit
In effect Jan. 31, 1980
Percent
1 Savings
2 Negotiable order of withdrawal
accounts 2
Time accounts 4
Fixed ceiling rates by maturity
3
30-89 days
4
90 days to 1 year
5
1 to 2 years 6 .
6
2 to 2 Yi years 6
7
2V2 to 4 years 6
8
4 to 6 years 7
9
6 to 8 years 7
10
8 years or more 7
11
Issued to governmental units (all
maturities)
12
Individual retirement accounts and
Keogh (H.R. 10) plans
(3 years or more) 9
Previous maximum
Effective
date
In effect Jan. 31, 1980
Effective
date
5VA
5
1/1/74
( )
5V4
9/1/79
7/1/73
5
5
7/1/73
53/4
5>
k
6V1
IVA
IVI
3
7 /4
7/1/73
11/1/73
12/23/74
6/1/78
Previous maximum
Effective
date
7/1/79
Effective
date
7/1/79
3
8
53/4
()
IVA
7
3
1/1/74
7/1/73
(5)
1/21/70
1/21/70
1/21/70
3
5/6
34
6V
i
3
6 /4
7 Yi
11/1/73
( )
5VA
3
( )
1 -y4
(')
(')
0)
( )
5VA
53/4
6
6
11/1/73
12/23/74
6/1/78
(8) ,
(3)
IVI
6/1/78
73/4
12/23/74
6/1/78
6/1/78
73/4
7/6/77
6/1/78
73/4
1/21/70
1/21/70
1/21/70
1/21/70
11/1/73
73/4
Special variable ceiling rates by maturity
13
6 months money market time
deposits) 10
14
4 years or more
1. July 1, 1973, for mutual savings bank; July 6, 1973 for savings and loan
associations.
2. For authorized states only. Federally insured commercial banks, savings and
loan associations, cooperative banks, and mutual savings banks in Massachusetts
and New Hampshire were first permitted to offer negotiable order of withdrawal
(NOW) accounts on Jan. 1, 1974. Authorization to issue NOW accounts was
extended to similar institutions throughout New England on Feb. 27, 1976, and
in New York State on Nov. 10, 1978.
3. No separate account category.
4. For exceptions with respect to certain foreign time deposits see the FEDERAL
RESERVE BULLETIN for O c t o b e r 1962 (p. 1279), A u g u s t 1965 (p. 1094), a n d Feb-
ruary 1968 (p. 167).
5. Multiple maturity: July 20, 1966; single maturity: September 26, 1966.
6. No minimum denomination. Until July 1, 1979, a minimum of $1,000 was
required for savings and loan associations, except in areas where mutual savings
banks permitted lower minimum denominations. This restriction was removed for
deposits maturing in less than 1 year, effective Nov. 1, 1973.
7. No minimum denomination. Until July 1, 1979, minimum denomination ws
$1,000 except for deposits representing funds contributed to an Individual Retirement Account (IRA) or a Keogh (H.R. 10) Plan established pursuant to the
Internal Revenue Code. The $1,000 minimum requirement was removed for such
accounts in December 1975 and November 1976, respectively.
8. Between July 1, 1973, and Oct. 31, 1973, there was no ceiling for certificates
maturing in 4 years or more with minimum denominations of $1,000; however,
the amount of such certificates that an institution could issue was limited to 5
percent of its total time and savings deposits. Sales in excess of that amount, as
well as certificates of less than $1,000, were limited to the 6V2 percent ceiling on
time deposits maturing in 2Vi years or more.
Effective Nov. 1, 1973, ceilings wre reimposed on certificates maturing in 4 years
or more with minimum denomination of $1,000. There is no limitation on the
amount of these certificates that banks can issue.
9. Accounts maturing in less than 3 years subject to regular ceilings.
10. Must have a maturity of exactly 26 weeks and a minimum denomination of
$10,000, and must be nonnegotiable.
Savings and loan associations and
mutual savings banks
7/6/77
n
M
W
( )
11. Commercial banks, savings and loan associations, and mutual savings banks
were authorized to offer money market time deposits effective June 1, 1978. The
ceiling rate for commercial banks is the discount rate on most recently issued 6 month U.S. Treasury bills. Until Mar. 15, 1979, the ceiling rate for savings and
loan associations and mutual savings banks was VA percentage point higher than
the rate for commercial banks. Beginning Mar. 15, 1979, the VA percentage point
interest differential is removed when the 6-month Treasury bill rate is 9 percent
or more. The full differential is in effect when the 6-month bill rate is 83/4 percent
or less. Thrift institutions may pay a maximum 9 percent when the 6-month bill
rate is between 83/4 and 9 percent. Also effective March 15, 1979 interest compounding was prohibited on money market time deposits at all offering institutions.
For both commerical banks and thrift institutions, the maximum allowable rates
in January were as follows: Jan. 3, 11.93; Jan. 10, 11.73; Jan. 17, 11.77; Jan. 24,
11.88; Jan. 31, 11.96.
12. Effective Jan. 1, 1980, commerical banks, savings and loan associations, and
mutual savings banks are authorized to offer variable ceiling accounts with no
required minimum denomination and with maturities of 2VI years or more. The
maximum rate for commercial banks is 13/A percentage points below the yield on
2VI year U.S. Treasury securities; the ceiling rate for thrift institutions is VA percentage point higher than that for commercial banks. In January, the ceiling at
commercial banks was 10.15 percent, and the ceiling at thrift institutions was 10.4
percent.
13. Between July 1, 1979, and Dec. 31, 1979, commercial banks, savings and
loan associations, and mutual savings banks were authorized to offer variable
ceiling accounts with no required minimum denomination and with maturities of
4 years or more. The maximum rate for commercial banks was WA percentage
points below the yield on 4-year U.S. Treasury securities; the ceiling rate for thrift
institutions is VA percentage point higher than that for commerical banks.
NOTE: Maximum rates that can be paid by federally insured commercial banks,
mutual savings banks, and savings and loan associations are established by the
Board of Governors of the Federal Reserve System, the Board of Directors of the
Federal Deposit Insurance Corporation, and the Federal Home Loan Bank Board
under the provisions of 12 CFR 217, 329, and 526, respectively. The maximum
rates on time deposits in denominations of $100,000 or more with maturities of
30-89 days were suspended in June 1970; such deposits maturing in 90 days or
more were suspended in May 1973. For information regarding previous interest
rate ceilings on all types of accounts, see earlier issues of the interest rate ceilings
on all types of accounts, see earlier issues of the FEDERAL RESERVE BULLETIN,
the Federal Home Loan Bank Board Journal and the Annual Report of the Federal
Deposit Insurance Corporation.
All
Policy Instruments
1.17
FEDERAL RESERVE OPEN MARKET TRANSACTIONS
Millions of dollars
1979
Type of transaction
1977
1979
1978
June
July
Aug.
Sept.
Nov.
Oct.
Dec.
U . S . GOVERNMENT SECURITIES
Outright transactions (excluding matched salepurchase transactions)
Treasury bills
1 Gross purchases
2 Gross sales
3 Redemptions
13,738
7,241
2,136
16,628
13,725
2,033
17,930 i
7,480
4,208 1
518
623
0
2,252
0
0
2,351
380
0
1,692
353
200
1,528'
780
968'
2,752
154
300
2,464
378
0
Others within 1 year2
Gross purchases
Gross sales
Exchange, or maturity shift
Redemptions
3,017
0
4,499
2,500
1,184
0
-5,170
0
3,203
0
7,499
3,908 1
42
0
1,152
0
218
0
33
0
57
0
1,526
0
120
0
876
0
28
0
-116
668'
0
0
-937
0
90
0
-155
0
1 to 5 years
8 Gross purchases
9 Gross sales
10 Exchange, or maturity shift
2,833
0
-6,649
4,188
0
-178
3,456 1
0
-6,653
0
0
-1,152
237
0
-33
699
0
-1,591
354
0
-876
703'
0
116
0
0
222
398
0
155
5 to 10 years
11 Gross purchases
12 Gross sales
13 Exchange, or maturity shift
758
0
584
1,526
0
2,803
523
0
-2,465
0
0
0
96
0
0
140
0
-240
73
0
0
0
0
0
0
0
400
81
0
0
Over 10 years
14 Gross purchases
15 Gross sales
16 Exchange, or maturity shift
553
0
1,565
1,063
0
2,545
454
0
1,619
0
0
0
142
0
0
81
0
305
87
0
0
0
0
0
0
0
314
51
0
0
20,898
7,241
4,636
24,591
13,725
2,033
25,565'
7,480
8,116'
561
623
0
2,945
0
0
3,327
380
0
2,326
353
200
2,259'
780
1,636'
2,752
154
300
3,084
378
0
4
5
6
7
All maturities2
17 Gross purchases
18 Gross sales
19 Redemptions
20
21
Matched sale-purchase transactions
Gross sales
Gross purchases
425,214
423,841
511,126
510,854
626,403
623,245
52,640
52,949
40,310
40,300
35,159
35,480
41,395
41,583
58,656
58,671
45,204
45,979
53,681
49,738
22
23
Repurchase agreements
Gross purchases
Gross sales
178,683
180,535
151,618
152,436
107,374
107,291
15,531
12,226
18,464
19,690
10,539
12,226
10,850
10,380
10,599
11,336
4,303
3,869
7,251
6,643
5,798
7,743
6,896
3,552
1,708
1,582
2,431
-878
3,507
-629
1,433
0
223
301
173
235
853
399
134
371
0
33
482
0
0
0
0
0
0
18
0
0
3
0
0
*
*
0
0
5
13,811
13,638
40,567
40,885
37,321
36,960
4,443
3,617
7,247
7,434
4,057
4,544
5,016
4,069
5,146
6,188
1,992
1,075
2,383
2,863
1,383
-426
681
1,163
295
-487
928
-1,045
917
-485
-196
159
0
-366
0
116
0
1,400
0
-241
0
-684
0
578
0
-735
0
-48
0
434
-37
-366
116
1,400
-241
-684
578
-735
-48
434
7,143
6,951
7,693
6,115
1,761
412
3,937
-2,658
4,376
-679
24 Net change in U.S. government securities
FEDERAL AGENCY OBLIGATIONS
25
26
27
Outright transactions
Gross purchases
Gross sales
Redemptions
28
29
Repurchase agreements
Gross purchases
Gross sales
30 Net change in federal agency obligations
'
BANKERS ACCEPTANCES
31 Outright transactions, net
32 Repurchase agreements, net
33 Net change in bankers acceptances
34 Total net change in System Open Market
Account
1. In April 1979, the System acquired $640 million of 2-day cash management
bills in exchange for maturing 2-year notes. New 2-year notes were later obtained
in exchange for the maturing bills. In Oct. 1979, $668 million of maturing 2- and
4- year notes were exchanged for a like amount of short-term bills, later exchanged
for new 2- and 4-year notes. Each of these transactions is treated in the table as
both a purchase and a redemption.
2. Both gross purchases and redemptions include special certificates created
when the Treasury borrows directly from the Federal Reserve, as follows (millions
of dollars): Sept. 1977, 2,500; Mar. 1979, 2,600.
NOTE. Sales, redemptions, and negatfve figures reduce holdings of the System
Open Market Account; all other figures increase such holdings. Details may not
add to totals because of rounding.
A12
1.18
DomesticNonfinancialStatistics • February 1980
FEDERAL RESERVE BANKS
Millions of dollars
Condition and Federal Reserve Note Statements
Wednesday
Account
End of month
1980
Jan.
IP
Jan. 9P
1980
Jan. 16P
Jan. 23P
Jan .P
Jan. 30?
Consolidated condition statement
ASSETS
18 Cash items in process of collection
19 Bank premises
20 Denominated in foreign currencies 2 .
21 All other
22 Total assets
11,172
1,800
405
11,172
1,800
427
11,172
1,800
441
11,172
2,968
462
11,112
1,800
415
11,112
1,800
403
11,172
2,968
469
2,060*
0
1,250
0
1,740
0
1,116
0
924
0
2,034
0
1,454
0
828
0
0
1,078
0
0
0
0
0
327
0
0
0
269
0
704
0
0
8,216
1,122
8,216
0
8,216
0
8,216
907
8,216
0
8,221
973
8,216
493
8,216
0
45,359
0
56,494
14,553
116,406
2,664
119,070
46,592
0
56,494
14,553
117,639
0
117,639
43,727
0
56,494
14,553
114,774
0
114,774
45,903
0
56,494
14,553
116,950
1,660
118,610
41,431
0
56,494
14,553
112,478
0
112,478
47,101
0
55,928
14,499
117,528
559
118,087
45,244
0
56,494
14,553
116,291
1,167
117,458
45,264
0
56,494
14,553
116,311
0
116,311
131,546
127,105
124,730
129,176
121,618
129,584
128,325
125,355
15,957
407
2,483
2,847
14,748
408
2,310
2,587
14,454
409
2,338
2,550
12,696
411
2,276
2,692
10,905
410
2,376
2,800
10,137
403
2,607
1,685
13,571
408
2,483
2,722
10,050
411
2,192
2,634
160,535
157,880
160,664
152,711
157,743
160,824
155,251
113,477
112,155
110,845
109,681
109,095
109,908
113,355
108,927
34,525
304
8
34,837
3,961
379
1,821
31,876
316
15
32,207
3,472
299
324
29,517
418
28
29,963
3,468
250
307
34,538
293
34
34,865
3,309
242
357
27,864
355
50
28,269
3,051
249
261
32,280
296
41
32,617
2,590
490
352
29,520
265
7
29,792
4,075
429
1,412
31,232
244
16
31,492
2,931
440
339
40,998
17 Total loans and securities .
11,112
1,800
408
166,560
1 Gold certificate account
2 Special drawing rights certificate account
3 Coin
Loans
4
Member bank borrowings
Other
5
Acceptances
6
Bought outright
7
Held under repurchase agreements
Federal agency obligations
8
Bought outright
9
Held under repurchase agreements
U.S. government securities
Bought outright
Bills
Certificates—Special
Notes
Bonds
Total 1
Held under repurchase agreements
16 Total U.S. government securities .
36,302
33,988
38,773
31,830
36,049
35,708
35,202
6,437
2,147
6,408
2,313
6,804
2,667
5,440
2,425
LIABILITIES
23 Federal Reserve notes
Deposits
Reserve accounts
24
Member banks
25
Edge Act Corporations
26
U.S. agencies and branches of foreign banks .
27
Total
28
U.S. Treasury—General account
29
Foreign—Official accounts
30
Other
31 Total deposits
34 Total liabilities
7,180
2,564
7,171
2,345
8,061
2,209
164,219
32 Deferred availability cash items
33 Other liabilities and accrued dividends 3
6,865
2,353
157,973
155,103
157,672
149,509
154,678
158,534
151,994
1,146
1,145
50
1,146
1,145
271
1,150
1,145
482
1,152
1,145
695
1,153
1,145
904
1,142
1,078
845
1,145
1,145
0
1,153
1,145
959
166,560
160,535
157,880
160,664
152,711
157,743
160,824
155,251
80,963
80,715
79,426
80,192
80,799
74,403
80,828
81,039
CAPITAL ACCOUNTS
35 Capital paid in
36 Surplus
37 Other capital accounts
38 Total liabilities and capital accounts
39 MEMO: Marketable U.S. government securities
held in custody for foreign and international
account
Federal Reserve note statement
40 Federal Reserve notes outstanding (issued to
Bank)
Collateral held against notes outstanding
41 Gold certificate account
42 Special Drawing Rights certificate account ...
43 Eligible paper
44 U.S. government and agency securities
45 Total collateral
125,217
125,131
125,496
125,601
125,698
124,864
125,301
125,707
11,112
1,800
691
111,614
11,172
1,800
673
111,486
11,172
1,800
942
111,582
11,172
1,800
793
111,836
11,172
2,968
583
110,975
11,112
1,800
1,246
110,706
11,112
1,800
894
111,495
11,172
2,968
635
110,932
125,217
125,131
125,496
125,601
125,698
124,864
125,301
125,707
1. Includes securities loaned—fully guaranteed by U.S. government securities
pledged with Federal Reserve Banks—and excludes (if any) securities sold and
scheduled to be bought back under matched sale-purchase transactions.
2. Beginning December 29, 1978, such assets are revalued monthly at market
exchange rates.
3. Includes exchange-translation account reflecting, beginning December 29,
1978, the monthly revaluation at market exchange rates of foreign-exchange commitments.
Reserve Banks
1.19
FEDERAL RESERVE BANKS
Millions of dollars
A13
Maturity Distribution of Loan and Security Holdings
Wednesday
Type and maturity
End of month
1980
Jan. 2
Jan. 9
1979
Jan. 16
Jan. 23
Nov. 30
Jan. 30
1980
Dec. 31
Jan. 31
1 Loans
2 -Within 15 days
3
16 days to 90 days
4
91 days to 1 year
2,060
2,027
33
0
1,250
1,219
31
0
1,718
1,510
208
0
1,116
1,096
20
0
924
873
51
0
2,034
1,894
140
0
1,453
1,441
12
0
828
813
15
0
5 Acceptances
6
Within 15 days
7
16 days to 90 days
8
91 days to 1 year
1,078
1,078
0
0
0
0
0
0
0
0
0
0
327
327
0
0
0
0
0
0
269
269
0
0
704
704
0
0
0
0
0
0
9 U.S. government securities
10
Within 15 days 1
11
16 days to 90 days
12
91 days to 1 year
13
Over 1 year to 5 years
14
Over 5 years to 10 years
15
Over 10 years
119.070
5,985
24,337
35,362
27,864
12,774
12,748
117,639
2,412
25,750
36,091
27,864
12,774
12,748
114,774
4,356
21,524
35,508
27,864
12,774
12,748
118,610
6,226
23,399
35,599
27,864
12,774
12,748
112,478
4,397
20,336
34,359
27,864
12,774
12,748
118,087
4,402
24,787
36,196
27,311
12,694
12,697
117,458
3,133
23,708
37,231
27,864
12,774
12,748
116,311
3,878
22,815
36,211
27,885
12,774
12,748
16 Federal agency obligations
17
Within 15 days 1
18
16 days to 90 days
19
91 days to 1 year
20
Over 1 year to 5 years
21
Over 5 years to 10 years
22
Over 10 years
9,338
1,123
558
1,338
4,252
1,325
742
8,216
42
516
1,355
4,236
1,325
742
8,216
42
579
1,292
4,236
1,325
742
9,123
986
546
1,277
4,238
1,356
720
8,216
79
546
1,277
4,238
1,356
720
9,194
1,098
420
1,363
4,168
1,403
742
8,709
644
457
1,307
4,234
1,325
742
8,216
79
546
1,277
4,238
1,356
720
1. Holdings under repurchase agreements are classified as maturing within 15
days in accordance with maximum maturity of the agreements.
1.20
BANK DEBITS AND DEPOSIT TURNOVER
Debits are shown in billions of dollars, turnover as ratio of debits to deposit. Monthly data are at annual rates.
Bank group, or type
of customer
1979
1976
1977
1978
July
Sept.
Aug.
Oct.
Nov.
53,324.9
19.740.2
33,584.7
51,884.8
19,223.0
32,661.9
843.6
90.8
752.8
679.0
172.0
641.2
120.2
168.1
643.0
117.2
4.0
8.6
3.8
3.7
8.0
3.5
Debits to demand deposits 1 (seasonally adjusted)
1 All commercial banks
2 Major New York City banks
3 Other banks
29,180.4
11,467.2
17,713.2
34,322.8
13,860.6
20,462.2
40,300.3
15,008.7
25,291.6
52,102.7
20,480.5
31,622.2
52,402.5
20,357.2
32,045.3
54,233.1
21,117.6
33,115.5
Debits to savings deposits 2 (not seasonally adjusted)
4 All customers
5 Business 3
6 Others
174.0
21.7
152.3
418.1
56.7
361.4
732.8
74.1
658.8
735.8
78.2
657.6
667.6
74.5
593.1
761.2
82.1
Demand deposit turnover 1 (seasonally adjusted)
7 All commercial banks
8 Major New York City banks
9 Other banks
116.8
411.6
79.8
129.2
503.0
85.9
139.4
541.9
96.7
171.9
717.7
115.2
173.1
709.1
116.9
175.0
711.5
118.2
Savings deposit turnover 2 (not seasonally adjusted)
10 All customers
11 Business 3
12 Others
1. Represents accounts of individuals, partnerships, and corporations, and of
states and political subdivisions.
2. Excludes negotiable order of withdrawal (NOW) accounts and special club
accounts, such as Christmas and vacation clubs.
3. Represents corporations and other profit-seeking organizations (excluding
commercial banks but including savings and loan associations, mutual savings
banks, credit unions, the Export-Import Bank, and federally sponsored lending
agencies.
1.6
4.1
1.5
1.9
5.1
1.7
3.4
7.2
3.2
3.4
7.4
3.2
3.1
7.0
2.9
NOTE. Historical data—estimated for the period 1970 through June 1977, partly
on the basis of the debits series for 233 SMSAs, which were available through June
1977—are available from Publications Services, Board of Governors of the Federal
Reserve System, Washington, D.C. 20551. Debits and turnover data for savings
deposits are not available prior to July 1977.
A14
1.21
DomesticNonfinancialStatistics • February 1980
MONEY STOCK MEASURES AND COMPONENTS
Billions of dollars, averages of daily figures
1976
Dec.
1977
Dec.
1978
Dec.
1979
1979
Dec.
Item
July
Aug.
Sept.
Oct.
Nov.
Dec.
Seasonally adjusted
MEASURES 1
1
2
3
4
5
305.0
307.7
1,166.7
1,299.7
1,523.5
M-1A
M-1B
M-2
M-3
L2
328.4
332.5
1,294.1
1,460.3
1,715.5
351.6
359.9
1,400.8
1,622.2
1,926.3
371.5
387.7
1,523.9
1.772.1
n.a.
363.2
378.0
1,476.4
1,702.9
2,057.3
365.4
380.7
1,489.5
1,719.3
2,074.9
367.5
383.2
1,499.7
1,738.2
2,103.3
368.0
383.9
1,507.2
1,751.8
2,115.4
369.6
385.3
1,514.5
1,762.5
2,124.8
371.5
387.7
1,523.9
1,772.1
n.a.
80.7
224.4
447.7
396.6
118.0
88.7
239.7
486.5
454.9
145.2
97.6
253.9
476.0
533.8
194.7
106.1
265.4
417.8
653.4
217.9
102.6
260.6
451.0
597.0
197.4
103.7
261.7
450.3
604.6
200.4
104.8
262.7
445.3
614.2
207.4
105.4
262.6
435.9
627.5
213.6
105.9
263.7
422.2
645.8
218.3
106.1
265.4
417.8
653.4
217.9
COMPONENTS
6
7
8
9
10
Currency
Demand deposits
Savings deposits
Small time deposits 3
Large time deposits 4
•
Not seasonally adjusted
MEASURES 1
11
12
13
14
15
313.5
316.1
1,169.1
1,303.8
1,527.1
M-1A
M-1B
M-2
M-3
L2
337.2
341.3
1,295.9
1,464.5
1,718.5
360.9
369.3
1,402.9
1,627.8
1,929.8
381.1
397.3
1,526.0
1,777.6
363.2
378.6
1,486.8
1,716.3
2,071.0
367.0
382.7
1,498.2
1,736.1
2,094.6
369.7
385.5
1,507.1
1,752.4
2,113.6
372.2
387.9
1,509.9
1,759.1
2,123.8
381.1
397.3
1,526.0
1,777.6
n.a.
365.1
379.9
1,482.1
1,706.1
2,059.2
82.1
231.3
2.7
13.6
3.4
444.9
393.5
119.7
90.3
247.0
4.1
18.6
3.8
483.2
451.3
147.7
99.4
261.5
8.3
23.3
10.3
472.8
529.8
198.2
108.0
273.0
16.2
24.2
43.6
414.9
648.7
221.5
103.2
261.9
14.8
25.0
28.0
454.4
597.4
194.9
103.9
259.3
15.3
25.2
31.2
451.1
603.3
200.0
104.5
262.5
15.7
26.1
33.7
445.6
612.7
206.8
105.2
264.4
15.8
25.6
36.9
434.6
627.3
214.2
106.6
265.6
15.7
23.5
40.4
420.0
640.8
219.5
108.0
273.0
16.2
24.2
43.6
414.9
648.7
221.5
n.a.
COMPONENTS
16
17
18
19
20
21
22
23
Currency
Demand deposits
Other checkable deposits 5
Overnight RPs and Eurodollars 6
Money market mutual funds
Savings deposits
Small time deposits 3
Large time deposits 4
1. Composition of the money stock measures is as follows:
M-1A: Averages of daily figures for (1) demand deposits at all commercial banks
other than those due to domestic banks, the U.S. government, and foreign banks
and official institutions less cash items in the process of collection and Federal
Reserve float; and (2) currency outside the Treasury, Federal Reserve banks, and
the vaults of commercial banks.
M-1B: M-1A plus NOW and ATS accounts at banks and thrift institutions, credit
union share draft accounts, and demand deposits at mutual savings banks.
M-2: M-1B plus savings and small-denomination time deposits at all depositary
institutions, overnight RPs at commercial banks, overnight Eurodollars held by
U.S. residents other than banks at Caribbean branches of member banks, and
money market mutual fund shares.
M-3: M-2 plus large-denomination time deposits at all depositary institutions
and term RPs at commercial banks and savings and loan associations.
2. L: M-3 plus other liquid assets such as term Eurodollars held by U.S. residents
other than banks, bankers acceptances, commercial paper. Treasury bills and other
liquid Treasury securities, and U.S. savings bonds.
3. Small time deposits are those issued in amounts of less than $100,000.
4. Large time deposits are those issued in amounts of $100,000 or more and are
net of the holdings of domestic banks, thrift institutions, the U.S. government,
money market mutual funds, and foreign banks and official institutions.
5. Includes ATS and NOW balances at all institutions, credit union share draft
balances, and demand deposits at mutual savings banks.
6. Overnight (and continuing contract) RPs are those issued by commercial
banks to the nonbank public, and overnight Eurodollars are those issued by Caribbean branches of member banks to U.S. nonbank customers.
NOTE. Latest monthly and weekly figures are available from the Board's
H.6(508) release. Back data are available from the Banking Section, Division of
Research and Statistics.
NOTES TO TABLE 1.23:
1. Includes domestic chartered banks, U.S. branches, agencies, and New York
investment company subsidiaries of foreign banks; and Edge Act corporations.
2. Excludes loans to commercial banks in the United States.
3. As of Dec. 31,1978, total loans and investments were reduced by $0.1 billion.
"Other securities" were increased by $1.5 billion and total loans were reduced by
$1.6 billion largely as the result of reclassifications of certain tax-exempt obligations. Most of the loan reduction was in "all other loans."
4. As of Jan. 3,1979, as the result of reclassifications, total loans and investments
and total loans were increased by $0.6 billion. Business loans were increased by
$0.4 billion and real estate loans by $0.5 billion. Nonbank financial loans were
reduced by $0.3 billion.
5. As of Dec. 31, 1977, as the result of loan reclassifications, business loans
were reduced by $0.2 billion and nonbank financial loans by $0.1 billion; real
estate loans were increased by $0.3 billion.
6. As of Dec. 31, 1978, commercial and industrial loans were reduced $0.1
billion as a result of reclassifications.
7. As of Dec. 31, 1978, nonbank financial loans were reduced $0.1 billion as
the result of reclassifications.
8. Loans sold are those sold outright to 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.
9. As of Dec. 31, 1978, commercial and industrial loans sold outright were
increased $0.7 billion as the result of reclassifications, but $0.1 billion of this
amount was offset by a balance sheet reduction of $0.1 billion as noted above.
10. United States includes the 50 states and the District of Columbia.
NOTE. Data are prorated averages of Wednesday data for domestic chartered
banks, and averages of current and previous month-end data for foreign-related
institutions.
Monetary Aggregates
1.22
AGGREGATE RESERVES AND DEPOSITS
A15
Member Banks
Billions of dollars, averages of daily figures
1976
Dec.
Item
1977
Dec.
1979
1978
Dec.
Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.
Seasonally adjusted
1 Reserves 1
34.89
36.10
41.27
40.65
40.48
40.42
40.82
41.07
41.46
42.32
43.13
2 Nonborrowed
3 Required
4 Monetary base 2
34.84
34.61
118.4
35.53
35.91
127.8
40.40
41.04
142.3
39.73
40.47
144.5
38.72
40.34
144.9
39.00
40.20
145.6
39.65
40.61
146.9
39.98
40.85
148.4
40.12
41.27
150.1
40.30
42.04
151.6
41.22
42.88
152.8
5 Deposits subject to reserve requirements 3
528.6
568.6
616.7
618.6
613.9
613.1
618.7
623.7
630.5
639.0
644.1
6 Time and savings
Demand
7
Private
8
U.S. government
354.1
386.7
429.4
432.0
428.7
425.9
429.4
434.4
439.8
445.6
451.8
171.5
3.0
178.5
3.5
185.1
2.3
184.7
1.8
183.5
1.7
184.8
2.4
187.5
1.8
187.1
2.2
189.0
1.8
191.7
1.8
190.4
2.0
Not seasonally adjusted
9 Monetary base 2
120.3
129.8
144.6
144.2
144.4
145.6
147.9
148.4
149.4
151.3
153.5
10 Deposits subject to reserve requirements 3
534.8
575.3
624.0
621.1
610.9
613.9
619.2
620.4
629.0
638.6
642.2
11 Time and savings
Demand
Private
U.S. government
353.6
386.4
429.6
432.3
429.8
427.2
429.8
434.1
439.4
445.7
449.7
177.9
3.3
185.1
3.8
191.9
2.5
186.8
2.0
179.2
1.8
183.9
2.8
187.8
1.6
184.5
1.7
187.5
2.1
191:4
1.6
191.4
1.7
12
13
3. Includes total time and savings deposits and net demand deposits as defined
by Regulation D. Private demand deposits include all demand deposits except
those due to the U.S. government, less cash items in process of collection and
demand balances due from domestic commercial banks.
1. Series reflects actual reserve requirement percentages with no adjustment to
eliminate the effect of changes in Regulations D and M. There are breaks in series
because of changes in reserve requirements effective Jan. 8 and Dec. 30, 1976;
and Nov. 2, 1978. In addition, effective Jan. 1, 1976, statewide branching in New
York was instituted. The subsequent merger of a number of banks raised required
reserves because of higher reserve requirements on aggregate deposits at these
banks.
2. Includes total reserves (member bank reserve balances in the current week
lus vault cash held two weeks earlier); currency outside the U.S. Treasury, Federal
Reserve Banks, and the vaults of commercial banks; and vault cash of nonmember
banks.
NOTE. Back data and estimates of the impact on required reserves and changes
in reserve requirements are shown in table 14 of the Board's Annual Statistical
Digest, 1971-1975.
S
1.23
LOANS AND INVESTMENTS
All Commercial Banks'
Billions of dollars; averages of Wednesday figures
Category
1977
Dec.
1979
1978
Dec.
Oct.?
Nov./7
1979
1977
Dec.
Oct.P
Dec.P
Seasonally adjusted
1 Total loans and securities 2
2 U.S. Treasury securities
3 Other securities
4 Total loans and leases 2
Commercial and industrial loans
5
Real estate loans
6
7
Loans to individuals
Security loans
8
Loans to nonbank financial institutions ..
9
Agricultural loans
10
Lease financing receivables
11
All other loans
12
1,129.1
1,128.6
1,132.5
93.4
173.1 3
747.8 3
246.5 6
210.5
164.9
19.4
27.1 7
28.2
7.4
43.6 3
95.3
188.8
845.0
288.6
237.1
181.3
20.6
30.9
30.0
8.9
47.5
94.3
190.5
843.8
288.3
239.7
182.3
18.4
30.9
29.4
9.1
45.7
93.8
191.5
847.2
290.4
242.4
182.9
18.3
30.3
31.0
9.4
42.3
895.9
1,018.1 3
1,132.7
1,132.2
1,135.3
636.9
4.8
751.6 3
3.8
848.6
3.6
847.4
3.6
849.9
2.8
213.9 5
248.5 9
291.3
290.9
292.2
1.99
6.8
2.7
8.0
2.5
7.9
1.8
8.5
99.5
159.6
632.1
211.2 5
175.2 5
138.2
20.6
25.8 5
25.8
5.8
29.5
NOV.P
Dec .P
Not seasonally adjusted
1,014.3 3
891.1
1978
Dec.
1,023.8 3
1,131.0
1,130.7
1,142.8
94.6
173.9 3
755.4 3
248.2 6
210.9
165.9
20.7
28.1
7.4
46.6 3
93.2
189.0
848.8
288.4
238.3
183.3
20.8
31.0
30.3
8.9
47.7
93.3
190.7
846.7
288.3
240.9
183.7
18.8
31.0
29.5
9.1
45.4
95.0
192.3
855.7
292.4
242.9
184.0
19.6
30.8
30.8
9.4
45.7
903.9
1,027.6 3
1,134.6
1,134.3
1,145.6
643.0
4.8
759.2 3
3.8
852.4
3.6
850.3
3.6
858.4
2.8
215.35
250.1 9
291.1
290.9
294.2
1.9 9
7.5
2.7
7.9
2.5
8.2
1.8
9.4
899.1
100.7
160.2
638.3
212.65
175.5 5
139.0
22.0
26.3 5
25.7
5.8
31.5
21.T1
MEMO:
13 Total loans and investments plus loans
sold2-8
14 Total loans plus loans sold 2 - 8
15 Total loans sold to affiliates 8
16 Commercial and industrial loans plus
loans sold 8
Commercial and industrial loans
17
sold 8
Acceptances held
18
Other commercial and industrial
19
loans
To U.S. addressees 10
20
To non-U.S. addressees
21
22 Loans to foreign banks
23 Loans to commercial banks in the
United States
For notes see bottom of opposite page.
2.7
7.5
2.7
8.6
203.7 5
193.8 5
9.9 5
13.5
239.7
226.6
13.1
21.2
280.6
261.1
19.5
23.1
280.4
261.2
19.3
19.6
282.0
263.2
18.8
18.7
203.9 s
193.7 5
10.3 s
14.6
240.9
226.5
14.4
23.0
280.6
261.3
19.2
22.6
280.1
260.7
19.4
19.1
283.0
263.2
19.8
20.1
54.1
57.3
76.4
75.1
77.8
56.9
60.3
74.2
76.5
81.9
A16
1.24
DomesticNonfinancialStatistics • February 1980
ASSETS AND LIABILITIES OF COMMERCIAL BANKING INSTITUTIONS
Last-Wednesday-of-Month Series
Billions of dollars except for number of banks
1979
1980
Account
Mar.
Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
Jan.
1,031.4
759.8
42.3
227.8
489.6
93.6
178.0
1,048.3
773.9
44.4
233.0
496.5
94.2
180.2
1,059.4
785.3
45.9
236.4
503.0
93.2
181.0
1,071.3
797.9
46.3
240.5
511.2
91.6
181.7
1,081.8
807.6
48.1
242.0
517.4
92.1
182.1
1,094.3
819.4
50.3
244.1
525.0
90.6
184.3
1,112.1
833.8
53.6
249.4
530.9
91.9
186.4
1,118.4
839.0
54.0
249.8
535.3
91.5
187.8
1,118.0
836.7
52.6
248.0
536.1
92.1
189.3
1,143.3
860.1
62.9
253.4
543.7
92.5
190.7
1,133.4
849.7
57.2
252.6
540.0
92.4
191.2
135.8
15.2
30.0
36.8
53.7
139.9
15.6
33.9
39.0
51.4
158.8
16.0
32.8
44.6
65.4
146.3
16.3
32.6
40.8
56.5
140.2
16.1
29.6
41.2
53.4
145.7
16.8
33.7
41.1
54.1
148.5
16.7
31.6
40.7
59.5
160.7
16.6
34.1
45.5
64.6
158.1
18.2
34.7
43.7
61.5
146.4
17.9
28.4
37.7
62.4
148.4
17.3
28.3
43.7
59.0
DOMESTICALLY CHARTERED
COMMERCIAL BANKS 1
1
2
3
4
5
6
7
8
Y
10
11
12
Loans and investments
Loans, gross
Interbank
Commercial and industrial
Other
U.S. Treasury securities
Other securities
Cash assets, total
Currency and coin
Reserves with Federal Reserve Banks
Balances with depositary institutions
Cash items in process of collection ...
13
Other assets
14
Total assets/total liabilities and capital ..
15
16
17
18
19
20
21
58.9
55.8
52.7
55.1
53.9
53.8
57.5
57.8
59.3
61.2
63.1
1,226.1
1,244.0
1,270.9
1,272.7
1,275.9
1,293.8
1,318.2
1,336.9
1,335.4
1,351.0
1,344.9
Deposits
Demand
Savings
Time
954.9
335.0
216.8
403.0
964.4
348.0
215.9
400.5
975.5
357.8
215.5
402.3
971.3
352.4
216.4
402.5
975.2
352.6
218.3
404.2
982.9
352.4
216.6
413.8
996.6
358.7
213.4
424.5
1,023.6
376.6
207.6
439.4
1,017.6
365.1
205.0
447.4
1,030.6
377.6
203.4
449.7
1,022.5
362.4
200.6
459.6
Borrowings
Other liabilities
Residual (assets less liabilities)
115.2
60.9
95.1
123.5
60.8
95.3
132.0
65.4
98.1
137.1
65.5
98.9
137.2
64.9
98.7
140.1
69.7
101.1
147.0
71.2
103.3
137.4
74.0
101.9
135.6
78.5
103.7
140.5
74.1
105.8
143.1
77.5
101.8
4.8
14,597
5.9
14,610
4.9
14,616
12.9
14,620
11.9
14,584
8.6
14,607
17.8
14,616
8.4
14,605
5.0
14,608
12.8
14,610
15.0
14,594
1,101.4
827.2
56.1
259.8
511.3
94.9
179.4
1,114.8
837.7
57.3
264.7
515.6
95.6
181.5
1,131.2
854.2
61.8
268.8
523.6
94.6
182.3
1,146.9
870.7
60.4
274.6
535.7
93.1
183.1
1,153.1
876.2
60.6
276.9
538.6
93.5
183.5
1,169.8
892.1
63.8
280.5
547.8
91.9
185.8
1,197.7
915.9
69.2
288.1
558.6
93.5
188.3
1,200.3
917.6
71.6
288.3
557.7
93.1
189.5
1,200.9
916.2
71.8
287.9
556.6
93.7
190.9
1,229.8
943.1
80.5
295.0
567.6
94.5
192.2
157.0
15.2
30.7
56.0
55.1
156.6
15.6
34.6
53.9
52.5
176.5
16.1
33.5
60.3
66.6
167.8
16.3
33.4
60.3
57.7
160.4
16.1
30.4
59.3
54.7
166.0
16.8
34.5
59.3
55.3
172.2
16.7
32.5
62.4
60.6
179.9
16.6
34.9
62.5
65.9
176.7
18.2
35.6
60.0
62.9
169.5
17.9
29.0
59.0
63.7
MEMO:
22
23
U.S. Treasury note balances included in
borrowing
Number of banks
ALL COMMERCIAL BANKING
INSTITUTIONS2
24
25
26
27
28
29
30
Loans and investments
Loans, gross
Interbank
Commercial and industrial
Other
U.S. Treasury securities
Other securities
31
32
33
34
35
Cash assets, total
Currency and coin
Reserves with Federal Reserve Banks
Balances with depositary institutions
Csh items in process of collection ....
36
Other assets
37
Total assets/total liabilities and capital ..
38
39
40
41
42
43
44
74.1
70.8
67.7
71.4
69.7
70.9
76.7
76.5
78.5
81.0
1,332.5
1,342.1
1,375.5
1,386.1
1,383.2
1,406.7
1,446.5
1,456.7
1,456.1
1,480.3
Deposits
Demand
Savings
Time
994.0
355.7
218.0
420.3
997.4
362.0
216.9
418.5
1,013.2
375.8
216.7
420.7
1,015.6
376.4
217.2
422.0
1,012.3
369.7
219.1
432.5
1,020.9
369.1
217.6
434.2
1,043.6
383.2
214.2
446.2
1,062.6
394.2
208.3
460.1
1,058.5
384.9
205.9
467.7
1,076.3
400.5
204.3
471.5
Borrowings
Other liabilities
Residual (assets less liabilities)
141.7
99.8
97.1
150.5
97.1
97.2
159.5
102.8
100.0
165.4
104.2
100.9
165.8
104.4
100.8
169.5
113.1
103.2
182.1
115.2
105.6
171.6
118.5
104.0
169.5
122.2
105.8
180.5
115.4
108.1
4.8
14,930
5.9
14,946
4.9
14,954
12.9
14,968
11.9
14,933
8.6
14,960
17.8
14,972
8.4
14,963
5.0
14,969
12.8
14,975
n.a.
MEMO:
45
46
U.S. Treasury note balances included in
borrowing
Number of banks
1. Domestically chartered commercial banks include all commercial banks in the
United States except branches of foreign banks; included are member and nonmember banks, stock savings banks, and nondeposit trust companies.
2. Commercial banking institutions include domestically chartered commercial
banks, branches and agencies of foreign banks, Edge Act and Agreement corporations, and New York state foreign investment corporations.
NOTE. Figures are partly estimated. They include all bank-premises subsidiaries
and other significant majority-owned domestic subsidiaries. Data for domestically
chartered commercial banks are for the last Wednesday of the month; data for
other banking institutions are for last Wednesday except at end of quarter, when
they are for the last day of the month.
Commercial Banks
1.25
COMMERCIAL BANK ASSETS AND LIABILITIES
A17
Call-Date Series
Millions of dollars, except for number of banks
1976
1978
1977
1976
June 30
Dec. 31
1978
1977
Account
Dec. 31
June 30
Dec. 31
Total insured
June 30
Dec. 31
June 30
National (all insured)
827,696
854,733
914,779
956,431
476,610
488,240
523,000
542,218
578,734
560,077
601,122
581,143
657,509
636,318
695,443
672,207
340,691
329,971
351,311
339,955
384,722
372,702
403,812
390,630
101,461
147,500
129,562
100,568
153,042
130,726
99,333
157,936
159,264
97,001
163,986
157,393
55,727
80,191
76,072
53,345
80,583
74,641
52,244
86,033
92,050
50,519
87,886
90,728
1,003,970
1,040,945
1,129,712
1,172,772
583.304
599,743
651,360
671,166
825,003
847,372
922,657
945,874
469,377
476,381
520,167
526,932
3,022
44,064
285,200
2,817
44,965
284,544
7,310
49,843
319,873
7,956
47,203
312,707
1,676
23,149
163,346
1,632
22,876
161,358
4,172
25,646
181,821
4,483
22,416
176,025
8,248
484,467
7,721
507,324
8,731
536,899
8,987
569,020
4,907
276,296
4,599
285,915
5,730
302,795
5,791
318,215
14 Borrowings
15 Total capital accounts
75,291
75,061
81,137
75,502
89,339
79,082
98,351
83,074
54,421
41,319
57,283
43,142
63,218
44,994
68,948
47,019
16 MEMO: Number of banks
14,397
14,425
14,397
14,381
4,735
4,701
4,654
4,616
1 Loans and investments, gross
Loans
2 Gross
3 Net
Investments
4 U.S. Treasury securities
5 Other
6 Cash assets
7 Total assets/total liabilities1
8 Deposits
Demand
9 U.S. government
10 Interbank
11 Other
Time and savings
12 Interbank
13 Other
Insured nonmember
State member (all insured)
144,000
144,597
152,514
157,464
207,085
221,896
239,265
256,749
102,277
99,474
102,117
99,173
110,243
107,205
115,736
112,470
135,766
130,630
147,694
142,015
162,543
156,411
175,894
169,106
18,849
22,874
32,859
19,296
23,183
35,918
18,179
24,091
42,305
16,886
24,841
43,057
26,884
44,434
20,631
27,926
46,275
20,166
28,909
47,812
24,908
29,595
51,259
23,606
23 Total assets/total liabilities1
189,579
195,452
210,442
217,384
231,086
245,748
267,910
284,221
24 Deposits
Demand
25 U.S. government
26 Interbank
27 Other
Time and savings
28 Interbank
29 Other
149,491
152,472
163,436
167,403
206,134
218,519
239,053
251,539
429
19,295
52,204
371
20,568
52,570
1,241
22,346
57,605
1,158
23,117
55,550
917
1,619
69,648
813
1,520
70,615
1,896
1,849
80,445
2,315
1,669
81,131
2,384
75,178
2,134
76,827
2,026
80,216
2,275
85,301
956
132,993
988
144,581
973
153,887
920
165,502
17,310
13,199
19,697
13,441
21,736
14,182
23,167
14,670
3,559
17,542
4,155
18,919
4,384
19,905
6,235
21,384
1,023
1,019
1,014
1,005
8,639
8,705
8,729
8,760
17 Loans and investment, gross
Loans
19 Net
Investments
20 U.S. Treasury securities
21 Other
22 Cash assets
30 Borrowings
31 Total capital accounts
32 MEMO: Number of banks
Total nonmember
Noninsured nonmember
18,819
22,940
24,415
28,699
225,904
244,837
263,681
285,448
16,336
16,209
20,865
20,679
22,686
22,484
26,747
26,548
152,103
146,840
168,559
162,694
185,230
178,896
202,641
195,655
1,054
1,428
6,496
993
1,081
8,330
879
849
9,458
869
1,082
9,360
27,938
45,863
27,127
28,919
47,357
28,497
29.788
48,662
34,367
30,465
52,341
32,967
39 Total assets/total liabilities1
26,790
33,390
36,433
42,279
257,877
279,139
304,343
326,501
40 Deposits
Demand
41 U.S. government
42 Interbank
43 Other
Time and savings
13,325
14,658
16,844
19,924
219,460
233,177
255,898
271,463
4
1,277
3,236
8
1,504
3,588
10
1,868
4,073
8
2,067
4,814
921
2,8%
72,884
822
3,025
74,203
1,907
3,718
84,518
2,323
3,736
85,946
45 Other
1,041
7,766
1,164
8,392
1,089
9,802
1,203
11,831
1,997
140,760
2,152
152,974
2,063
163,690
2,123
177,334
47 Total capital accounts
4,842
818
7,056
893
6,908
917
8,413
962
8,401
18,360
11,212
19,812
11,293
20,823
14,649
22,346
275
293
310
317
8,914
8,998
9,039
9,077
33 Loans and investments, gross
Loans
35 Net
Investments
36 U.S. Treasury securities
37 Other
38 Cash assets
48 MEMO: Number of banks
1. Includes items not shown separately.
For Note see table 1.24
A18
1.26
DomesticNonfinancialStatistics • February 1980
COMMERCIAL BANK ASSETS AND LIABILITIES
Detailed Balance Sheet, September 30, 1978
Millions of dollars, except for number of banks
Member banks'
Asset account
Insured
commercial
banks
Large banks
All other
New York
Citv
1 Cash bank balances, items in process
2
Currency and coin
3
Reserves with Federal Reserve Banks
4
Demand balances with banks in United States .
5
Other balances with banks in United States
6
Balances with banks in foreign countries
7
Cash items in process of collection
8 Total securities held—Book value ...
9
U.S. Treasury
10
Other U.S. government agencies .
11
States and political subdivisions ...
12
All other securities
13
Unclassified total
14
15
16
17
18
19
Trading-account securities
U.S. Treasury
Other U.S. government agencies ....
States and political subdivisions
All other trading account securities .
Unclassified
20
21
22
23
24
Bank investment portfolios
U.S. Treasury
Other U.S. government agencies .
States and political subdivisions ...
All other portfolio securities
47,914
2,918
12,200
3,672
648
1,507
26,969
37,986
4,901
11,067
8,945
1,319
705
11,049
7.918
2,690
1,284
3,705
240
58,271
22,051
7,730
27,423
1,048
19
92,881
31,499
14,616
44,831
1,887
47
3.238
2,407
401
363
67
708
408
82
117
2,446
278
794
145
19
290
78
55
107
3
47
17.570
7.117
1,426
8,803
224
7,210
2,282
55,825
20,840
7,452
26,629
903
92,591
31,422
14,561
44,724
1,884
134.955
8.866
28,041
25.982
2.582
2.832
66.652
43.758
867
3.621
262,199
95.068
40.078
179,877
65,764
25,457
85.125
3,465
66
20.808
9,524
6,833
4,125
825
1,395
394
94
6.681
255,366
90.943
39,253
119,865
5.305
173.196
5,698
94
4,103
816
1,381
316
66
61,661
24,641
83,745
3,149
Other
large
5,298
180
1.152
543
15
288
3,119
158.380
12.135
28.043
41.104
4,648
3,295
69.156
121.260
City of
Chicago
12.821
601
331
25.516
1.828
9.166
291
101
1,201
3,588
138
1,210
1,656
1,403
311
111
507
475
41.258
34,256
4,259
2.743
31,999
25,272
4.119
2,608
3,290
1.987
482
1,784
1,294
396
94
16,498
12,274
2,361
1,863
10,427
9,717
541
169
675,915
17,019
7,431
651,465
500,802
11,355
5,894
483,553
79,996
675
1.347
77.974
26,172
107
341
25,724
190,565
3,765
2,256
184,544
204,069
6,809
1,949
195,311
203,386
25,621
8,418
10,241
2.598
2,938
685
34
1,559
1,460
44
1,417
99
27
72
660
52,687
9,236
453
111,674
7,503
104,171
5,502
399
5,103
52,171
138,730
19,100
3,655
81,370
77,422
6,500
70,922
3,948
340
3.609
34,605
72,863
6,581
3,146
43.236
41,570
2,502
39,068
1,665
92
I,573
19,901
Loans to financial institutions .
REITs and mortgage companies
Domestic commercial banks
Banks in foreign countries
Other depositary institutions
Other financial institutions
Loans to security brokers and dealers
Other loans to purchase or carry securities .
Loans to farmers except real estate
Commercial and industrial loans
37,072
8,574
3,362
7,359
1,579
16,198
11,042
4,280
28,054
213, 123
34,843
8,162
2,618
7,187
1,411
15,465
10,834
3,532
15,296
171,815
12,434
2.066
966
3.464
290
5,649
6.465
410
168
39,633
4,342
15,137
4,616
55 Loans to individuals
56
Installment loans
57
Passenger automobiles
58
Residential repair and modernization .
59
Credit cards and related plans
60
Charge-account credit cards
61
Check and revolving credit plans ...
62
Other retail consumer goods
63
Mobile homes
64
Other
65
Other installment loans
66
Single-payment loans to individuals
67 All other loans
161,599
131,571
58,908
8,526
21,938
17,900
4,038
19,689
9,642
10,047
22,510
30,027
17,360
110,974
90,568
37,494
5,543
19,333
16,037
3,296
13,296
6,667
6,629
14,902
20,406
14,778
7,100
5,405
I,077
331
68 Total loans and securities, net .
956,579
6,717
22,448
3,255
16,557
34,559
1,198,495
25 Federal Reserve stock and corporate stock
26 Federal funds sold and securities resale agreement .
27
Commercial banks
28
Brokers and dealers
29
Others
30 Other loans, gross
31 LESS: Unearned income on loans .
32
Reserves for loan loss
33 Other loans, net
Other loans, gross, by category
34 Real estate loans
35
Construction and land development ..
Secured by farmland
Secured by residential properties
1- to 4-family residences
FHA-insured or VA-guaranteed .
Conventional
Multifamily residences
FHA-insured
Conventional
Secured by other properties
45
46
47
48
49
50
51
52
53
54
69
70
71
72
73
Direct lease financing
Fixed assets—Buildings, furniture, real estate .
Investment in unconsolidated subsidiaries
Customer acceptances outstanding
Other assets
74 Total assets .
117,176
821
23
5.362
4,617
508
4,109
746
132
613
2,258
801
165
268
76
3,033
1,324
276
150
13,290
31,212
29,774
3,446
26,328
I,438
88
1,350
11,786
2,930
680
281
635
261
1,073
199
985
11,196
51,059
1,206
2,820
785
5,710
2,846
1,860
3,781
67,833
40,320
33,640
1,573
695
427
179
249
1,302
1,694
3,545
2,562
1,711
209
60
1,267
1,219
47
57
19
38
119
851
1,290
696,833
102,383
35,536
259,820
299,094
259,867
6,212
16,529
3,209
16,036
30,408
1,145
2,332
1,642
8,315
II,323
96
795
188
1,258
1,000
3,931
6,268
1,282
6,054
12,810
1,041
7,133
96
409
5,275
505
5,926
46
521
4,249
904,182
170,899
44,170
338,079
351,034
294,595
2,268
II,626
2,088
9,736
8,192
1,545
5,242
2,563
2,678
4,948
6,680
6,100
60,993
49,811
24,582
3,064
6,062
5,053
1,009
7,570
3,905
3,664
8,533
II,182
3,844
For notes see opposite page.
Commercial Banks
A19
1.26 Continued
Member banks 1
Liability or capital account
Insured
commercial
banks
Large banks
Total
All other
New York
City
City of
Chicago
Nonmember
banks 1
Other
large
75
76
77
/8
79
80
81
82
83
Demand deposits
Mutual savings banks
Other individuals, partnerships, and corporations
U.S. government
States and political subdivisions
Foreign governments, central banks, etc
Commercial banks in United States
Banks in foreign countries
Certified and officers' checks, etc
369,030
1,282.
279,651
7,942
17,122
1,805
39,596
7,379
14,253
282,450
1,089
205,591
5,720
11,577
1,728
38,213
7,217
11,315
66,035
527
31,422
569
764
1,436
21,414
5,461
4,443
10,690
1
7,864
188
252
19
1,807
207
352
100,737
256
79,429
1,987
3,446
211
10,803
1,251
3,354
104,988
305
86,876
2,977
7,116
62
4,189
298
3,166
86,591
194
74,061
2,222
5,545
77
1,393
162
2,937
84
85
86
87
88
89
90
91
92
Time deposits
Accumulated for personal loan payments
Mutual savings banks
Other individuals, partnerships, and corporations
U.S. government
States and political subdivisions
Foreign governments, central banks, etc
Commercial banks in United States
Banks in foreign countries
368,562
79
399
292,120
864
59,087
6,672
7,961
1,381
266,496
66
392
210,439
689
40,010
6,450
7,289
1,161
38,086
0
177
29,209
61
1,952
3,780
2,077
829
15,954
0
40
12,074
40
1,554
1,145
999
103
98,525
1
148
76,333
356
16,483
1,401
3,585
219
113,931
65
27
92,824
232
20,020
124
629
9
102,066
13
7
81,680
175
19,077
222
672
220
93
94
95
96
97
98
Savings deposits
Individuals and nonprofit organizations
Corporations and other profit organizations
U.S. government
States and political subdivisions
All other
223,326
207,701
11,216
82
4,298
30
152,249
141,803
7,672
65
2,682
27
10,632
9,878
519
2
215
18
2,604
2,448
148
3
4
*
54,825
51,161
3,195
24
437
8
84,188
78,316
3,809
35
2,025
2
71,077
65,897
3,544
17
1,616
3
99
Total deposits
960,918
701,195
114,753
29,248
254,087
303,107
259,733
91,981
42,174
12,787
37,020
85,582
39,607
11,849
34,126
21,149
6,991
2,130
12,028
8,777
5,235
1,616
1,926
41,799
21,609
6,381
13,809
13,857
5,773
1,722
6,362
6,398
2,566
939
2,894
8,738
1,767
16,661
27,124
8,352
1,455
16,140
23,883
3,631
234
8,398
8,600
306
27
1,260
1,525
3,191
701
6,070
9,020
1,225
491
412
4,477
386
316
521
3,494
1,107,188
836,607
157,026
41,144
314,868
323,569
270,849
5,767
4,401
1,001
79
2,033
1,287
1,366
85,540
63,174
12,871
2,947
21,177
26,178
22,380
88
17,875
32,341
33,517
1,719
36
12,816
23,127
26,013
1,182
0
2,645
4,541
5,554
132
0
570
1,404
921
52
5
4,007
8,148
8,680
337
31
5,594
9,034
10,858
661
52
5,064
9,217
7,509
538
1,198,495
904,182
170,899
44,170
338,079
351,034
294,595
252,337
171,864
18,537
5,576
60,978
86,774
80,472
Federal funds purchased and securities sold under agreements
to repurchase
101
Commercial banks
102
Brokers and dealers
Others
103
100
104
105
106
107
Other liabilities for borrowed money
Mortgage indebtedness
Bank acceptances outstanding
Other liabilities
108
Total liabilities
109
Subordinated notes and debentures
110
111
112
113
114
115
Equity capital
Preferred stock
Common stock
Surplus
Undivided profits
Other capital reserves
116
Total liabilities and equity capital
MEMO:
117
Demand deposits adjusted 2
146,283
124,916
36,862
6,030
45,731
36,293
21,379
43,873
651,874
183,614
944,593
33,682
483,316
150,160
687,543
4,272
76,750
32,196
107,028
1,887
25,722
13,216
28,922
16,007
184,790
65,776
250,804
11,517
196,054
38,972
300,789
10,307
168,558
33,454
257,062
124
Average for last 15 or 30 days
Cash and due from bank
Federal funds sold and securities purchased under agreements to resell
Total loans
Time deposits of $100,000 or more
Total deposits
Federal funds purchased and securities sold under agreements to repurchase
Other liabilities for borrowed money
92,685
8,716
86,635
8,326
22,896
3,679
9,473
370
40,541
3,211
13,725
1,067
6,053
390
125
126
127
128
Standby letters of credit outstanding
Time deposits of $100,000 or more
Certificates of deposit
Other time deposits
18,820
186,837
160,227
26,610
17,658
152,553
129,667
22,886
10,063
32,654
27,950
4,704
1,477
13,486
11,590
1,896
4,820
66,684
56,383
10,301
1,297
39,728
33,743
5,985
1,162
34,284
30,560
3,724
129
Number of banks
14,390
5,593
12
9
153
5,419
8,810
118
119
120
121
122
123
1. Member banks exclude and nonmember banks include 13 noninsured trust
companies that are members of the Federal Reserve System.
2. Demand deposits adjusted are demand deposits other than domestic commercial interbank and U.S. government, less cash items reported as in process of
collection.
NOTE. Data include consolidated reports, including figures for all bank-premises
subsidiaries and other significant majority-owned domestic subsidiaries. Securities
are reported on a gross basis before deductions of valuation reserves. Back data
in lesser detail were shown in previous issues of the BULLETIN.
A20
1.27
DomesticNonfinancialStatistics • February 1980
ALL LARGE WEEKLY REPORTING COMMERCIAL BANKS with Domestic Assets of $750 Million or More on
December 31, 1977, Assets and Liabilities
Millions of Dollars, Wednesday figures
1979
1980
Account
Dec. 5
Dec. 12
Dec. 19
Dec. 26
Jan. 2P
Jan. 9P
Jan. 16p
Jan. 23P
Jan. 30>
1 Cash items in process of collection
2 Demand deposits due from banks in the United
States
3 All other cash and due from depositary institutions
4 Total loans and securities
54,832
53,254
54,391
50,218
59,660
51,467
57,368
51,844
49,080
16,522
33,266
509,020
15,151
33,161
505,753
18,836
30,242
512,758
9,090
27,986
518,148
17,918
36,197
529,669
16,573
33,397
520,067
16,813
31,304
518,117
17,570
35,126
510,790
18,217
28,563
515,050
Securities
5 U.S. Treasury securities
6
Trading account
7
Investment account, by maturity
8
One year or less
9
Over one through five years
10
Over five years
11 Other securities
12
Trading account
13
Investment account
14
U.S. government agencies
15
States and political subdivision, by maturity ..
16
One year or less
17
Over one year
18
Other bonds, corporate stocks and securities
36,954
6,049
30,905
7,931
18,354
4,620
71,669
4,450
67,219
15,458
49,125
6,428
42,697
2,636
37,271
6,314
30,958
8,030
18,295
4,632
71,711
4,208
67,503
15,590
49,257
6,425
42,832
2,656
36,381
5,483
30,898
8,095
4,522
71,499
3,740
67,759
15,679
49,424
6,439
42,984
2,657
35,580
5,030
30,550
7,951
18,079
4,520
71,418
3,597
67,821
15,691
49,474
6,361
43,114
2,655
36,089
4,890
31,200
8,003
18,596
4,600
71,998
3,532
68,466
15,851
49,964
6,239
43,725
2,651
35,956
5,109
30,847
7,551
18,715
4,581
72,619
3,669
68,950
15,813
50,482
6,344
44,138
2,656
35,885
5,415
30,470
7,241
18,615
4,614
72,596
3,553
69,043
15,855
50,526
6,255
44,270
2,663
35,456
5,206
30,251
7,313
18,310
4,628
72,510
3,457
69,053
15,869
50,524
6,231
44,293
2,660
35,638
5,243
30,395
7,371
18,312
4,712
72,545
3,427
69,118
15,858
50,584
6,333
44,251
2,676
26,217
19,010
5,159
2,048
386,280
153,444
4,738
148,705
142,175
6,531
97,464
70,636
25,288
18,952
4,667
1,669
383,640
152,629
4,512
148,117
141,605
6,512
97,990
70,843
27,356
20,589
5,100
1,667
389,781
155,481
4,848
150,633
144,112
6,520
98,277
71,224
30,901
22,880
5,663
2,358
392,492
156,797
5,388
151,408
144,881
6,527
98,211
71,702
34,194
27,939
4,698
1,557
399,672
159,155
5,177
153,979
147,379
6,599
99,916
73,359
28,447
21,737
4,928
1,781
395,424
157,654
4,737
152,917
146,338
6,579
100,250
73,648
27, 638
20,344
5,157
2,136
394,373
157,013
4,560
152,453
145,919
6,534
100,456
73,298
24,776
19,252
4,093
1,430
390,442
156,471
4,176
152,295
145,819
6,476
100,768
73,260
27,739
20,256
5,054
2,429
391,574
156,605
4,287
152,318
145,858
6,459
101,042
73,499
3,487
6,974
9,146
16,814
8,375
2,540
4,848
12,552
6,892
5,209
374,180
7,675
61,048
682,363
3,140
6,8%
8,677
16,714
7,043
2,573
4,823
12,311
6,939
5,218
371,483
7,784
61,533
676,636
3,332
6,974
17,001
8,180
2,607
4,850
13,033
7,039
5,222
377,520
7,810
62,458
686,4%
3,715
6,796
9,322
16,957
7,483
2,588
4,889
14,032
7,051
5,191
380,249
7,842
61,365
674,649
3,792
7,468
9,462
17,106
7,737
2,533
5,047
14,096
7,101
5,182
387,388
7,967
65,508
716,919
3,711
6,909
8,798
16,852
7,340
2,506
4,993
12,762
7,173
5,205
383,045
8,079
61,746
691,330
3,461
7,201
9,000
16,577
7,301
2,528
4,954
12,584
7,166
5,210
381,997
8,085
61,824
693,510
2,854
6,051
8,580
16,243
6,357
2,506
4,898
12,453
7,174
5,219
378,048
8,103
62,158
685,590
2,792
6,420
8,634
16,142
6,303
2,503
4,922
12,711
7,204
5,242
379,128
8,100
64,512
683,521
196,858
717
134,685
4,560
2,703
33,394
8,195
1,891
10,713
265,622
72,722
68,094
193,130
602
136,482
4,562
1,774
29,706
8,305
2,463
9,236
265,460
72,464
67,845
199,303
638
137,067
5,112
3,082
34,669
7,678
1,894
9,163
265,452
72,413
67,898
188,853
657
144,835
4,805
839
20,597
8,670
1,902
6,549
265,004
72,223
67,729
219,190
916
155,769
5,942
863
35,975
8,337
1,777
9,610
267,415
74,604
70,048
195.993
744
140,106
5,105
963
30,429
7,828
1,937
8,880
270,030
74,733
70,151
202,340
769
142,498
5,030
1,265
32,793
8,590
2,175
9,219
269,036
73,847
69,404
190,598
622
133,631
4,921
964
32,318
6,892
2,115
9,134
268,405
73,221
68,752
189,508
619
131,981
5,240
772
31,576
8,232
2,211
8,876
269,086
72,648
68,201
3,924
684
21
192,900
159,941
22,079
494
5,485
3,896
696
27
192,996
159,563
22,056
493
5,485
3,805
688
23
193,039
159,817
21,682
493
5,252
3,796
674
23
192,782
159,572
21,651
492
5,217
3,773
759
24
192,812
159,993
21,374
467
5,128
3,784
774
23
195,297
161.994
21,692
477
5,260
3,703
718
21
195,189
162,220
21,968
446
5,320
3,720
731
18
195,184
162,191
22,099
' 426
5,473
3,721
704
22
196,437
163,484
22,272
424
5,3%
4,901
95,767
5,398
95,720
5,795
92,667
5,849
90,579
5,849
100,898
5,873
101,828
5,234
95,947
4,995
95,945
4,862
90,717
1,620
434
13,649
1,285
574
13,440
951
6,566
13,545
1,410
8,203
14,822
1,545
6,926
14,498
842
1,670
14,145
1,290
4,385
13,642
445
8,213
13,986
299
9,815
14,984
63,409
637,360
61,873
631,482
63,020
641,505
60,800
629,672
60,887
671,360
61,039
645,547
61,068
647,708
62,151
639,742
63,211
637,620
45,003
45,154
44,977
45,559
45,783
45,802
45,848
45,901
Loans
19 Federal funds sold
20
To commercial banks
21
To nonbank brokers and dealers in securities ...
22
To others
23 Other loans, gross
24
Commercial and industrial
25
Bankers' acceptances and commercial paper .
26
All other
27
U.S. addresses
28
Non-U.S. addresses
29 Real estate
30
To individuals for personal expenditures
To financial institutions
31
Commercial banks in the United States
32
Banks in foreign countries
33
Sales finance, personal finance companies, etc
34
Other financial institutions
35
To nonbank brokers and dealers in securities ...
36
To others for purchasing and carrying securities 2
37
To finance agricultural production
38
All other
39 LESS: Unearned income
40
Loan loss reserve
41 Other loans, net
42 Lease financing receivables
43 All other assets
44 Total assets
Deposits
45 Demand deposits
46
Mutual savings banks
47
Individuals, partnerships, and corporations
48
States and political subdivisions
49
U.S. government
50
Commercial banks in the United States
51
Banks in foreign countries
52
Foreign governments and official institutions ...
53
Certified and officers' checks
54 Time and savings deposits
55
Savings
56
Individuals and nonprofit organizations
57
Partnerships and corporations operated for
profit
58
Domestic governmental units
59
All other
60
Time
61
Individuals, partnerships, and corporations ...
62
States and political subdivisions
63
U.S. government
64
Commercial banks in the United States
65
Foreign governments, official institutions and
banks
66 Federal funds purchased 3
Other liabilities for borrowed money
67
Borrowings from Federal Reserve Banks
68
Treasury tax-and-loan notes
69
All other liabilities for borrowed money
70 Other liabilities and subordinated note and
debentures
71 Total liabilities
72 Residual (total assets minus total liabilities) 4
1. Includes securities purchased under agreements to resell.
2. Other than financial institutions and brokers and dealers.
3. Includes securities sold under agreements to repurchase.
18,281
8,821
4. This is not a measure of equity capital for use in capital adequacy analysis
or for other analytic uses.
A See p. A-23.
Weekly Reporting Banks
1.28
A21
LARGE WEEKLY REPORTING COMMERCIAL BANKS with Domestic Assets of $1 Billion or More on
December 31, 1977 Assets and Liabilities
Millions of dollars, Wednesday figures
Jan. 16p
Jan. 23p
Jan. 3OP
bank,
1979 A
49,126
54,585
49,462
46,913
29
15,757
15,902
16,719
17,338
78
33,962
31,502
29,468
32,948
26,616
77
485,271
494,902
485,232
483,152
476,322
480,509
1,860
34,064
5,445
28,620
7,586
16,839
4,194
66,099
3,628
62,471
14,597
45,372
5,875
39,496
2,503
33,263
4,999
28,264
7,440
16,637
4,187
66,012
3,488
62,524
14,610
45,413
5,798
39,615
2,502
33,628
4,860
28,768
7,493
17,070
4,205
66,286
3,415
62,871
14,786
45,592
5,651
39,940
2,493
33,477
5,061
28,416
7,037
17,193
4,186
66,922
3,570
63,351
14,738
46,115
5,766
40,349
2,498
33,423
5,380
28,043
6,728
17,096
4,218
66,882
3,449
63,433
14,780
46,148
5,678
40,470
2,504
32,963
5,143
27,821
6,800
16,789
4,232
66,792
3,377
63,416
14,782
46,132
5,650
40,482
2,502
33,155
5,206
27,950
6,863
16,787
4,300
66,795
3,311
63,484
14,778
46,188
5,752
40,436
2,518
194
22,589
16,762
4,219
1,608
360,747
145,265
4,443
140,822
134,358
6,463
92,274
62,905
24,445
18,081
4,749
1,614
366,746
148,073
4,768
143,304
136,833
6,471
92,550
63,230
28,084
20,543
5,236
2,306
369,296
149,350
5,310
144,039
137,561
6,478
92,484
63,656
31,401
25,562
4,339
1,500
374,955
151,235
5,099
146,136
139,581
6,555
93,718
64,800
25,498
19,261
4,515
1,723
370,793
149,753
4,658
145,095
138,562
6,532
94,080
65,067
24,551
17,856
4,615
2,079
369,749
149,082
4,480
144,602
138,114
6,488
94,271
64,732
22,133
17,225
3,534
1,374
365,901
148,544
4,089
144,455
138,026
6,429
94,570
64,708
25,097
18,224
4,494
2,380
366,984
148,666
4,197
144,469
138,056
6,413
94,800
64,908
3,417
6,899
3,070
6,817
3,268
6,883
3,647
6,714
3,714
7,390
3,639
6,829
3,391
7,121
2,784
5,978
2,719
6,338
8,954
16,354
8,293
8,482
16,254
6,959
8,622
16,557
8,095
9,128
16,524
7,375
9,270
16,653
7,605
8,611
16,394
7,213
8,811
16,144
7,205
8,393
15,818
6,280
8,466
15,703
6,224
2,316
4,681
11,934
6,321
4,928
351,944
7,469
59,305
2,343
4,656
11,721
6,366
4,940
349,441
7,578
59,832
2,377
4,685
12,406
6,464
4,936
355,345
7,603
60,706
2,355
4,722
13,341
6,478
4,907
357,911
7,633
59,602
2,301
4,884
13,385
6,486
4,882
363,587
7,757
63,747
2,276
4,828
12,103
6,555
4,903
359,335
7,867
60,035
2,294
4,792
11,904
6,546
4,907
358,296
7,872
60,127
2,280
4,736
11,808
6,553
4,915
354,432
7,888
60,477
2,270
4,762
12,127
6,586
4,936
355,461
7,885
62,731
1
18
22
52
13
1,239
642,920
637,296
646,663
634,484
673,760
649,520
651,107
643,817
641,992
2,132
185,036
690
125,418
4,056
2,497
31,936
8,127
1,890
10,422
247,869
67,512
63,244
181,345
578
127,096
4,018
1,639
28,369
8,236
2,456
8,954
247,713
67,271
63,006
187,245
613
127,800
4,406
2,845
33,211
7,626
1,893
8,851
247,796
67,240
63,076
176,716
635
135,201
4,151
770
19,188
8,613
1,900
6,258
247,333
67,084
62,932
205,400
884
144,850
5,225
784
34,375
8,268
1,776
9,238
248,577
69,020
64,796
183,782
713
130,354
4,536
841
29,072
7,760
1,936
8,569
250,967
69,131
64,896
189,629
736
132,467
4,383
1,077
31,384
8,539
2,175
8,866
249,863
68,282
64,177
178,629
599
124,218
4,197
733
31,078
6,835
2,114
8,856
249,175
67,700
63,569
177,846
592
122,733
4,595
687
30,281
8,182
2,211
8,566
249,844
67,170
63,063
672
3,633
614
20
180,357
149,637
20,136
488
5,200
3,605
633
26
180,443
149,242
20,119
487
5,202
3,520
621
22
180,555
149,455
19,845
486
4,979
3,514
614
23
180,249
149,196
19,778
484
4,946
3,492
709
24
179,556
148,977
19,430
458
4,846
3,501
710
23
181,836
150,809
19,712
469
4,977
3,427
657
21
181,581
150,922
19,952
438
5,039
3,443
670
18
181,475
150,808
20,067
418
5,191
3,442
644
21
182,675
152,051
20,232
415
5,125
4,896
90,538
5,393
90,688
5,791
87,557
5,845
85,516
5,845
95,692
5,869
96,221
5,230
90,552
4,991
90,658
4,852
85,620
1,568
400
13,336
1,261
528
12,888
884
6,095
13,199
1,294
7,691
14,420
1,487
6,398
14,169
756
1,538
13,793
1,196
4,046
13,291
417
7,633
13,563
286
9,131
14,493
15
62,022
60,574
61,722
59,409
59,538
59,747
59,789
60,973
61,932
35
600,768
594,996
604,496
592,380
631,261
606,805
608,365
601,049
599,153
1,971
42,152
42,300
42,167
42,104
42,498
42,715
42,741
42,768
42,838
161
Dec. 5
1 Cash items in process of collection
2 Demand deposits due from banks in the United
States
3 All other cash and due from depositary
institutions
4 Total loans and securities
Securities
5 U.S. Treasury securities
6
Trading account
7
Investment account, by maturity
8
One year or less
9
Over one through five years
10
Over five years
11 Other securities
12
Trading account
13
Investment account
14
U.S.government agencies
15
States and political subdivision, by maturity ..
16
One year or less
17
Over one year
18
Other bonds, corporate stocks and securities
Loans
19 Federal funds sold 1
20
To commercial banks
21
To nonbank brokers and dealers in securities ...
22
To others
23 Other loans, gross
24
Commercial and industrial
25
Bankers' acceptances and commercial paper .
26
All other
27
U.S. addressees
28
Non-U.S. addressees
29
Real estate
30
To individuals for personal expenditures
To financial institutions
31
Commercial banks in the United States
32
Banks in foreign countries
33
Sales finance, personal finance companies,
etc
34
Other financial institutions
35
To nonbank brokers and dealers in securities ...
36
To others for purchasing and carrying
securities 2
37
To finance agricultural production
38
All other
39 LESS: Unearned income
40
Loan loss reserve
41 Other loans, net
42 Lease financing receivables
43 All other assets
44 Total assets
Deposits
45 Demand deposits
46
Mutual savings banks
47
Individuals, partnerships, and corporations
48
States and political subdivisions
49
U.S. government
50
Commercial banks in the United States
51
Banks in foreign countries
52
Foreign governments and official institutions ...
53
Certified and officer's checks
54 Time and savings deposits
55
Savings
56
Individuals and nonprofit organization
57
Partnerships and corporations operated for
profit
58
Domestic governmental units
59
All other
60
Time
61
Individuals, partnerships, and corporations ...
62
States and political subdivisions
63
U.S. government
64
Commercial banks in the United States
65
Foreign governments, official institutions, and
banks
66 Federal funds purchased 3
Other liabilities for borrowed money
67
Borrowings from Federal Reserve Banks
68
Treasury tax-and-loan notes
69
All other liabilities for borrowed money
70
Other liabilities and subordinated note and
debentures
71 Total liabilities
72 Residual (total assets minus total liabilities) 4
Dec. 12
Dec. 19
Dec. 26
Jan. 2P
52,343
50,880
51,803
47,391
56,372
15,715
14,344
17,999
8,353
17,019
31,540
31,338
28,599
26,233
476,548
473,323
479,954
34,655
6,008
28,647
7,411
16,931
4,304
66,292
4,328
61,964
14,391
45,090
5,873
39,217
2,483
34,961
6,277
28,684
7,511
16,858
4,315
66,332
4,110
62,222
14,516
45,203
5,868
39,335
2,503
23,657
16,820
4,844
1,993
363,193
146,036
4,667
141,370
134,885
6,484
91,771
62,536
1. Includes securities purchased under agreements to resell.
2. Other than financial institutions and brokers and dealers.
3. Includes securities sold under agreements to repurchase.
Jan. 9p
194
102
82
10
280
280
59
217
46
170
4
146
53
93
1,304
262
262
262
1
500
494
6
87
609
32
4
1
24
1,207
552
530
21
1
655
570
80
4
42
4. This is not a measure of equity capital for use in capital adequacy analysis
or for other analytic uses.
A See p. A-23.
A22
1.29
DomesticNonfinancialStatistics • February 1980
LARGE WEEKLY REPORTING COMMERCIAL BANKS IN NEW YORK CITY Assets and Liabilities
Millions of dollars, Wednesday figures
1979
1980
Account
Dec. 5
1 Cash items in process of collection
2 Demand deposits due from banks in the United
States
3 All other cash and due from depositary
institutions
4 Total loans and securities 1
Securities
5 U.S. Treasury securities 2
6
Trading account 2
7
Investment account, by maturity
8
One year or less
9
Over one through five years
10
Over five years
11 Other securities 2
12
Trading account 2
13
Investment account
14
U.S. government agencies
15
States and political subdivision, by maturity
16
One year or less
17
Over one year
18
Other bonds, corporate stocks and securities
Loans
19 Federal funds sold 3
20
To commercial banks
21
To nonbank brokers and dealers in securities
22
To others
23 Other loans, gross
24
Commercial and industrial
25
Bankers' acceptances and commercial paper
26
All other
27
U.S. addressees
28
Non-U.S. addressees
29
Real estate
30
To individuals for personal expenditures
To financial institutions
31
Commercial banks in the United States
32
Banks in foreign countries
33
Sales finance, personal finance companies, etc
34
Other financial institutions
35
To nonbank brokers and dealers in securities
36
To others for purchasing and carrying securities 4
37
To finance agricultural production
38
All other
39 LESS: Unearned income
40
Loan loss reserve
41 Other loans, net
42 Lease financing receivables
43 All other assetsS
44 Total assets
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
Deposits
Demand deposits
Mutual savings banks
Individuals, partnerships, and corporations
States and political subdivisions
U.S. government
Commercial banks in the United States
Banks in foreign countries
Foreign governments and official institutions
Certified and officers' checks
Time and savings deposits
Savings
Individuals and nonprofit organizations
Partnerships and corporations operated for profit ....
Domestic governmental units
All other
Time
Individuals, partnerships, and corporations
States and political subdivisions
U.S. government
Commercial banks in the United States
Foreign governments, official institutions, and banks
Federal funds purchased 6
Other liabilities for borrowed money
Borrowings from Federal Reserve Banks
Treasury tax-and-loan notes
All other liabilities for borrowed money
Other liabilities and subordinated note and debentures ...
Total liabilities
72 Residual (total assets minus total liabilities) 7
1.
2.
3.
4.
Excludes trading account securities.
Not available due to confidentiality.
Includes securities purchased under agreements to resell.
Other than financial institutions and brokers and dealers.
Dec. 12
Dec. 19
Dec. 26
Jan. 2P
Jan. 9P
19,442
19,083
19,078
14,205
19,333
18,931
21,372
20,354
11,036
9,655
12,339
3,369
11,359
10,524
11,021
12,160
8,076
8,291
6,658
4,692
10,296
7,895
6,985
8,693
110,699
108,335
112,927
115,511
117,132
112,809
112,951
108,416
6,342
1,265
4,461
616
6,165
1,165
4,281
720
6,055
1,165
4,284
605
5,857
1,165
4,066
626
6,255
1,259
4,385
611
5,951
1,019
4,319
613
5,881
1,014
4,211
656
5,695
1,032
4,004
659
12,166
2,539
9,066
1,471
7,595
561
12,204
2,546
9,083
1,472
7,611
576
12,412
2,550
9,269
1,524
7,745
592
12,419
2,530
9,301
1,551
7,749
588
12,347
2,532
9,222
1,498
7,725
592
12,347
2,518
9,226
1,477
7,750
603
12,308
2,479
9,224
1,450
7,774
605
12,245
2,426
9,213
1,454
7,759
606
7,188
4,745
1,790
653
87,608
45,598
1,661
43,936
41,838
2,098
12,137
8,188
6,210
4,230
1,509
471
86,381
45,347
1,682
43,665
41,595
2,070
12,191
8,419
7,411
5,415
1,376
621
89,724
46,963
1,836
45,127
43,034
2,093
12,243
8,469
10,166
7,870
1,502
794
89,740
47,143
1,929
45,214
43,101
2,113
12,284
8,495
9,199
7,470
1,233
496
91,915
47,977
1,897
46,080
43,854
2,226
12,321
8,496
7,2%
5,446
1,237
612
89,813
47,505
1,885
45,621
43,385
2,235
12,298
8,554
7,644
5,490
1,480
673
89,724
47,264
1,716
45,547
43,337
2,210
12,343
8,562
6,072
4,521
1,148
402
87,008
46,886
1,364
45,522
43,325
2,197
12,386
8,559
1,469
3,166
3,784
4,972
4,745
425
264
2,860
972
1,633
85,003
1,504
29,308
1,272
3,167
3,560
4,921
4,033
421
252
2,796
983
1,643
83,755
1,498
30,350
1,260
3,154
3,547
5,274
5,133
422
276
2,983
1,039
1,636
87,049
1,501
29,630
1,389
2,924
3,874
5,262
4,423
426
290
3,228
1,050
1,621
87,069
1,505
28,110
1,465
3,590
3,920
5,331
4,626
422
282
3,485
975
1,609
89,331
1,549
30,546
1,463
3,304
3,528
5,186
4,300
425
262
2,987
996
1,601
87,216
1,565
27,919
1,443
3,511
3,682
5,052
4,220
432
267
2,947
1,002
1,603
87,118
1,570
27,512
1,070
2,618
3,456
4,972
3,566
438
250
2,807
999
1,605
84,404
1,573
28,019
180,067
177,212
182,134
167,394
190,215
179,642
181,411
179,215
63,763
360
29,882
470
718
18,926
6,238
1,069
6,098
44,652
9,423
8,935
353
125
9
35,229
29,213
1,672
42
1,589
2,714
27,518
60,850
311
30,933
340
352
16,110
6,377
1,545
4,880
44,972
9,431
8,922
351
143
15
35,541
29,109
1,613
41
1,576
3,201
28,693
65,120
351
32,027
407
758
20,470
5,635
1,061
4,410
45,646
9,408
8,927
338
131
12
36,239
29,591
1,591
47
1,442
3,568
25,299
51,261
347
33,368
431
104
6,727
6,509
1,086
2,689
45,359
9,448
8,965
345
126
12
35,911
29,233
1,569
46
1,379
3,684
25,018
69,403
519
37,201
483
96
19,500
6,321
932
4,351
44,891
9,623
9,121
334
156
12
35,269
28,816
1,439
45
1,250
3,718
32,043
61,648
393
32,721
605
164
16,619
5,953
1,085
4,108
45,371
9,682
9,182
336
150
13
35,689
29,234
1,456
54
1,249
3,697
29,878
66,198
409
34,152
557
242
18,436
6,662
1,304
4,436
44,962
9,589
9,104
329
144
11
35,373
29,455
1,501
53
1,263
3,100
26,074
63,836
322
32,139
460
19,437
5,154
1,331
4,885
44,788
9,472
8,990
327
145
10
35,316
29,466
1,492
51
1,393
2,914
25,564
500
3
6,430
23,311
49
6,020
22,700
1,820
6,301
24,061
631
2,058
7,234
21,986
1,602
6,408
21,908
229
330
6,346
21,868
250
912
6,094
22,847
166,177
1,913
6,452
22,592
163,285
168,247
153,547
176,255
165,671
167,338
165,146
13,890
13,926
13,887
13,846
13,960
13,972
14,073
14,069
110
5. Includes trading account securities.
6. Includes securities sold under agreements to repurchase.
7. This is not a measure of equity capital for use in capital adequacy analysis
or for other analytic uses.
Weekly Reporting Banks
1.30
LARGE WEEKLY REPORTING COMMERCIAL BANKS
A23
Balance Sheet Memoranda
Millions of dollars, Wednesday figures
1979
1980
Adjustment
bank,
1979A
Category
Jan. 9P
503,796
396,798
117,199
510,222
402,134
122,692
506,997
398,422
113,134
506,687
398,205
110,914
501,077
393,110
105,472
504,448
396,265
108,080
3,651
130,213
92,972
37,242
129,698
92,581
37,118
128,367
91,498
36,869
129,628
92,266
37,363
129,364
92,405
36,958
128,965
91,820
37,145
129,930
92,615
37,315
324
238
3,200
1,090
2,707
1,780
927
2,749
1,819
930
2,646
1,711
934
2,662
1,728
934
2,612
1,705
907
2,655
1,749
906
464,797
363,504
100,456
470,005
369,841
99,385
472,466
373,190
109,367
476,994
377,080
113,868
473,790
373,392
104,743
473,357
373,051
102,582
467,781
368,025
97,356
471,089
371,139
99,966
1,865
1,391
638
122,588
87,898
34,690
122,434
87,302
35,132
122,367
87,111
35,255
121,830
86,710
35,120
120,267
85,403
34,864
121,416
86,078
35,338
121,032
86,134
34,898
120,582
85,501
35,081
121,496
86,262
35,234
140
67
74
3,082
2,038
1,044
3,120
2,066
1,054
3,140
2,080
1,060
2,649
1,752
2,696
1,796
901
2,597
1,687
910
2,614
1,704
909
2,562
1,674
2,606
1,719
887
19 Total loans (gross) and investments adjusted 1 - 4 .
20 Total loans (gross) adjusted 1
21 Demand deposits adjusted 2
107,091
88,582
24,676
105,459
87,089
25,305
108,927
90,460
24,812
108,923
90,647
30,225
110,781
92,179
30,474
108,497
90,200
25,933
108,623
90,434
26,148
105,429
87,489
23,936
107,391
89,373
25,441
22 Time deposits in accounts of $100,000 or more ..
23
Negotiable CDs
24
Other time deposits
28,187
20,192
7,994
28,479
20,109
8,370
29,106
20,447
8,659
28,760
20,214
8,546
28,046
19,576
8,470
28,435
19,838
8,598
28,009
20,051
7,958
27,918
19,864
8,054
28,444
20,316
8,128
Dec. 12
Dec. 19
Dec. 26
1 Total loans (grossl and investments adjusted 1 ...
2 Total loans (gross) adjusted 1
3 Demand deposits adjusted 2
498,624
390,001
105,929
495,818
386,836
108,396
501,098
393,217
107,161
4 Time deposits in accounts of $100,000 or more ..
5
Negotiable CDs
6
Other time deposits
130,518
93,791
36,727
130,352
93,170
37,182
3,146
2,070
1,077
3,184
2,097
1,087
2,110
10 Total loans (grossl and investments adjusted 1 ...
11 Total loans (gross) adjusted 1
12 Demand deposits adjusted 2
467,560
366,613
98,260
13 Time deposits in accounts of $100,000 or more ..
14
Negotiable CDs
15
Other time deposits
Jan.
\6P
Jan. 2P
Dec. 5
BANKS WITH ASSETS OF $ 7 5 0 MILLION OR M O R E
7 Loans sold outright to affiliates 3
8
Commercial and industrial
9
Other
2,682
1,146
86
BANKS WITH ASSETS OF $1 BILLION OR MORE
16 Loans sold outright to affiliates 3
17
Commercial and industrial
18
Other
BANKS IN NEW YORK CITY
1. Exclusive of loans and federal funds transactions with domestic commercial
banks.
2. All demand deposits except U.S. government and domestic banks less cash
items in process of collection.
3. Loans sold are those sold outright to 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.
4. Excludes trading account securities.
A Revised. These amounts represent accumulated adjustments originally made
to offset the cumulative effects of mergers. A "positive" adjustment bank should
be added to, and a "negative" adjustment bank subtracted from, outstanding data
for any date in the year to establish comparability with any date in the subsequent
year.
NOTES T O T A B L E 1.311.
1. Commercial banks are those in the 50 states and the District of Columbia
with national or state charters plus U.S. branches, agencies, and New York investment company subsidiaries of foreign banks and Edge Act corporations.
2. Includes seasonally adjusted Federal funds, RPs, and other borrowings from
nonbanks and not seasonally adjusted net Eurodollars and loans to affiliates.
Includes averages of Wednesday data for domestic chartered banks and averages
of current and previous month-end data for foreign-related institutions.
3. Other borrowings are borrowings on any instrument, such as a promissory
note or due bill, given for the purpose of borrowing money for the banking business.
This includes borrowings from Federal Reserve Banks and from foreign banks,
t e r m f e d e r a l f u n d s , o v e r d r a w n d u e f r o m b a n k b a l a n c e s , loan R P s ,
and participations in pooled loans. Includes averages of daily figures for member
banks and averages of current and previous month-end data for foreign-related
institutions.
4. Loans initially booked by the bank and later sold to affiliates that are still
held by affiliates. Averages of Wednesday data.
5. Includes averages of daily figures for member banks and quarterly call report
figures for nonmember banks.
6. Includes averages of current and previous month-end data.
7. Based on daily average data reported by 46 large banks.
8. Includes U.S. Treasury demand deposits and Treasury tax and loan notes at
commercial banks. Averages of daily data.
9. Averages of Wednesday figures.
A24
1.31
DomesticNonfinancialStatistics • February 1980
LARGE WEEKLY REPORTING COMMERCIAL BANKS
Domestic Classified Commercial and Industrial Loans
Millions of Dollars
Outstanding
Industry classification
Net change during
1979
1980
1979
Sept. 26
Oct. 31
Nov. 28
Dec. 26
Jan. 30
Q3
1 Durable goods manufacturing
23,954
23,472
22,856'
23,593
23,721
2,689
1
2 Nondurable goods manufacturing
3
Food, liquor, and tobacco
Textiles, apparel, and leather
4
5
Petroleum refining
6
Chemicals and rubber
7
Other nondurable goods
18,907
4,906
5,029
1,972
3,627
3,372
19,121
5,024
4,849
2,182
3,810
3,255
18,379
4,968
4,608
1,873
3,749
3,182
19,205
5,220
4,342
2,677
3,836
3,129
19,211
4,963
4,153
3,206
3,744
3,145
1,503
535
328
6
179
456
298
314
-686
705
209
-243
-741
-57
-241
-309
-61
-73
-195
8 Mining (including crude petroleum
and natural gas
Q4
Adjustment
bank 2
1980
Nov.
Dec.
-616'
Jan.
737
826
252
-266
805
87
-53
11,681
11,697
11,502
11,998
12,244
673
317
9 Trade
10 Commodity dealers
11 Other wholesale
12 Retail
24,655
1,859
11,940
10,855
25,410
2,191
12,170
11,049
25,077
1,861
11,902
11,314'
24,885
2,134
11,992
10,759
24,230
2,118
11,730
10,382
685
-58
199
544
230
275
52
-96
-332'
-330
-268
265'
13 Transportation, communication,
and other public utilities
14 Transportation
15 Communication
16 Other public utilities
16,760
6,833
2,325
7,602
16,885
7,065
2,404
7,416
17,212
7,075
2,475
7,662
17,830
7,133
2,522
8,176'
18,058
7,230
2,633
8,195
1,434
380
274
779
1,070'
300
197
574'
327
10
70
247
618
58
47
513
17 Construction
18 Services
19 All other i
5,892
18,359
14,525'
5,687
18,782
14,494'
5,703'
18,924'
14,505'
5,759'
19,399
14,892'
5,757
19,776
15,058
309
1,108
-1,335
-133r
1,040
367
16'
142
11'
56
475
387
134,373 '
135,547'
134,158 r
137,561 '
138,056
7,066
3,189 r
68,372'
69,010'
69,731'
72,447'
75,469
3,826
4,074'
20 Total domestic loans
21 MEMO: Term loans (original
maturity more than 1 year)
included in domestic loans)
721'
n.a.
n.a.
3,403
168
262
2,716
n .a.
n .a.
NOTE. New series. The 134 large weekly reporting commercial banks with domestic assets of $1 billion or more as of December 31, 1977 are included in this
series. The revised series is on a last-Wednesday-of-the-month basis.
1. Includes commercial and industrial loans at a few banks with assets of $1
billion or more that do not classify their loans.
2. Data for adjustment bank for individual categories are not yet available.
Previously published data are incorrect. Revised data will be published when
available.
1.311
-1,389
495
-192
273
90
-555
MAJOR NONDEPOSIT FUNDS OF COMMERCIAL BANKS'
Monthly averages, billions of dollars
Outstanding in 1979'
December outstanding
Source
1976
1
2
3
4
5
6
Total nondeposit funds
Seasonally adjusted 2
Not seasonally adjusted
Federal funds, RPs, and other borrowings from
nonbanks 3
Seasonally adjusted 3
Not seasonally adjusted
Net Eurodollar borrowings, not seasonally adjusted
Loans sold to affiliates, not seasonally adjusted 4
1977
1978
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
54.6
53.3
61.8
60.4
85.4'
84.9'
111.4
113.5
115.3
115.1
118.8
121.5
129.7
131.3
131.0
131.2
129.8
130.5
125.6
128.4
119.9
118.5
47.1
45.8
3.7
3.8
58.4
57.0
-1.3
4.8
74.8
73.8
6.8
3.8
84.3
86.5
23.4
3.7
84.5
84.3
27.1
3.8
86.6
89.3
28.4
3.7
92.9
94.5
33.1
3.7
91.3
91.5
35.9
3.7
91.9
92.6
34.3
3.6
85.9
88.6
36.2
3.6
87.9
86.5
29.2
2.8
-6.0
12.8
6.8
-12.5
21.1
8.6
-10.2
24.9
14.7
2.8
19.5
22.3
5.4
20.1
25.5
5.6
20.3
26.0
8.2
19.5
27.7
10.5
21.7
32.2
9.1
22.1
31.2
11.4
21.7
33.0
6.4
22.9
29.3
9.7
8.3
18.1
27.9
27.0
11.1
10.3
21.4
36.3
35.1
17.0
14.2
31.2
43.8
42.4
20.6
15.9
36.5
44.4
47.1
21.7
17.6
39.3
47.3
46.7
22.8
17.6
40.4
45.1
44.7
24.9
16.2
41.0
43.0
44.7
25.4
18.1
43.5
45.0
46.8
25.3
20.5
45.7
46.9
46.4
24.8
21.9
46.8
41.8
43.9
22.8
24.2
47.0
46.7
45.2
3.9
4.4
4.4
5.1
8.6
10.2
9.3
8.4
9.2
10.8
15.3
13.2
12.4
9.8
11.1
12.4
12.9
11.7
5.7
5.5
8.0
9.5
136.0
138.4
159.8
162.5
204.4
207.8
199.0
198.2
191.7
191.6
192.5
191.0
194.7
194.9
199.5
200.8
206.1
207.5
212.1
212.1
210.2
213.8
MEMO
7 Domestic chartered banks net positions with own
foreign branches, not seasonally adjusted 5
8
Gross due from balances
9
Gross due to balances
10 Foreign-related institutions net positions with
cnrectly related institutions, not seasonally adjusted 6
11 Gross due from balances
12 Gross due to balances
13 Security RP borrowings, seasonally adjusted 7
14 Not seasonally adjusted
15 U.S. Treasury demand balances, seasonally
adjusted®
16 Not seasonally adjusted
17 Time deposits, $100,000 or more, seasonally
adjusted 9
18 Not seasonally adjusted
For notes see bottom of page A23.
Deposits and Commercial Paper
1.32
A25
GROSS DEMAND DEPOSITS of Individuals, Partnerships, and Corporations'
Billions of dollars, estimated daily-average balances
Commercial banks
Type of holder
19792
1978
1975
Dec.
1976
Dec.
1977
Dec.
June
Sept.
Dec.
Mar.
June
Sept.
Dec.
1 All holders—Individuals, partnerships, and
corporations
236.9
250.1
274.4
271.2
278.8
294.6
270.4
285.6
292.4
302.2
2
3
4
5
6
20.1
125.1
78.0
2.4
11.3
22.3
130.2
82.6
2.7
12.4
25.0
142.9
91.0
2.5
12.9
25.7
137.7
92.9
2.4
12.4
25.9
142.5
95.0
2.5
13.1
27.8
152.7
97.4
2.7
14.1
24.4
135.9
93.9
2.7
13.5
25.4
145.1
98.6
2.8
13.7
26.7
148.8
99.2
2.8
14.9
27.1
157.7
99.2
23.1
15.1
Financial business
Nonfinancial business
Consumer
Foreign
Other
Weekly reporting banks
19793
1978
1975
Dec.
1976
Dec.
1977
Dec.
Oct.
7 All holders—Individuals, partnerships, and
corporations
8
9
10
11
12
Financial business
Nonfinancial business
Consumer
Foreign
Other
Dec.
Mar.
June
Sept.
Dec.
124.4
128.5
139.1
141.3
142.7
147.0
121.9
128.8
132.7
139.3
15.6
69.9
29.9
2.3
6.6
17.5
69.7
31.7
2.6
7.1
18.5
76.3
34.6
2.4
7.4
19.1
75.0
37.5
2.5
7.2
19.3
75.7
37.7
2.5
7.5
19.8
79.0
38.2
2.5
7.5
16.9
64.6
31.1
2.6
6.7
18.4
68.1
33.0
2.7
6.6
19.7
69.1
33.7
2.8
7.4
20.1
74.1
34.3
3.0
7.8
3. After the end of 1978 the large weekly reporting bank panel was changed to
170 large commercial banks, each of which had total assets in domestic offices
exceeding $750 million as of Dec. 31, 1977. See "Announcements," p. 408 in the
May 1978 BULLETIN. Beginning in March 1979, demand deposit ownership estimates for these large banks are constructed quarterly on the basis of 97 sample
banks and are not comparable with earlier data. The following estimates in billions
of dollars for December 1978 have been constructed for the new large-bank panel;
financial business, 18.2; nonfinancial business, 67.2; consumer, 32.8; foreign, 2.5;
other, 6.8.
1. Figures include cash items in process of collection. Estimates of gross deposits
are based on reports supplied by a sample of commercial banks. Types of depositors
in each category are described in the June 1971 BULLETIN, p. 466.
2. Beginning with the March 1979 survey, the demand deposit ownership survey
sample was reduced to 232 banks from 349 banks, and the estimation procedure
was modified slightly. To aid in comparing estimates based on the old and new
reporting sample, the following estimates in billions of dollars for December 1978
have been constructed using the new smaller sample; financial business, 27.0;
nonfinancial business, 146.9; consumer, 98.3; foreign, 2.8; and other, 15.1
1.33
Nov.
COMMERCIAL PAPER AND BANKERS DOLLAR ACCEPTANCES OUTSTANDING
Millions of dollars, end of period
1979
Instrument
1976
Dec.
1977
Dec.
1978
Dec.
June
July
Aug.
Sept.
Oct. 1
Nov.
Dec.
Commercial paper (seasonally adjusted)
1 All issuers
2
3
4
5
6
Financial companies 2
Dealer-placed paper3
Total
Bank-related
Directly placed paper4
Total
Bank-related
Nonfinancial companies 5
52,971
65,101
83,665
101,516
102,447
103,907
107,621
106,613
108,965
113,282
7,261
1,900
8,884
2,132
12,296
3,521
16,537
3,826
17,042
3,951
17,379
4,062
18,207
4,485
16,085
3,052
16,702
2,958
17.574
2,784
32,511
5,959
13,199
40,484
7,102
15,733
51,360
12,314
19,739,
61,256
15,130
23,723
60,532
14,722
24,873
60,402
15,817
26,126
61,369
15,930
28,045
62,761
18,024
27,767
64,236
18,339
28,027
64,757
17,598
30,951
Bankers of dollar acceptances (not reasonably adjusted)
7 Total
8
9
10
11
12
13
Holder
Accepting banks
Own bills
Bills bought
Federal Reserve Banks
Own account
Foreign correspondents
Others
Basis
14. Imports into United States
15 Exports from United States
16 All other
22,523
25,450
33,700
36,989
39,040
42,354
42,147
43,486
43,599
45,321
10,442
8,769
1,673
10,434
8,915
1,519
8,579
7,653
927
8,180
6,956
1,224
8,288
7,243
1,045
7,994
7,138
856
8,119
7,288
831
7,785
7,121
664
8,297
7,514
782
9,867
8,329
1,538
991
375
10,715
954
362
13,700
1
664
24,456
1,400
971
26,439
1,159
952
28,641
475
957
32,928
1,053
1,470
31,505
317
1,498
33,886
269
1,465
33,569
704
1,382
33,368
4,992
4,818
12,713
6,378
5,863
13,209
8,574
7,586
17,540
9,202
8,599
19,189
9,499
8,784
20,756
9,847
9,578
22,929
9,724
9,354
23,069
10,129
9,519
23,838
10,354
9,271
23,974
10,270
9,640
25,411
1. A change in reporting instructions results in offsetting shifts in the dealerplaced and directly placed financial company paper in October.
2. Institutions engaged primarily in activities such as, but not limited to, commercial, savings, and mortage banking; sales, personal and mortgage financing;
factoring, finance leasing, and other business lending; insurance underwriting; and
for FRASER activities.
other investment
Digitized
3. Includes all financiel company paper sold by dealers in the open market.
4. As reported by financial companies that place their paper directly with investors.
5. Includes public utilities and firms engaged primarily in activities, such as
communications, construction, manufacturing, mining, wholesale and retail trade,
transportation and reserves.
A26
1.34
DomesticNonfinancialStatistics • February 1980
PRIME RATE CHARGED BY BANKS on Short-Term Business Loans
Percent per annum
Effective date
\\Vi
1979—June 19
July 27
Aug. 16
28
Sept. 7
14
21
28
1.35
Effective Date
Rate
11^4
Rate
\AVi
1979—Oct.
12
12 V
4
12^4
13
13V4
13 Vi
9
23
1
9
16
30
Dec. 7
1979—Jan .
Feb.
Mar.
Apr.
May
June
15
15 V
4
15k>
153/4
Nov.
Average
rate
Month
1k
5>
11.75
11.75
11.75
11.75
11.75
11.65
15V4
1979—July
Aug.
Sept.
Oct.
Nov.
Dec.
1980—Jan.
TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, November 5-10, 1979
Size of loan (in thousands of dollars)
Item
All
sizes
1,000
1-24
25-49
100-499
50-99
and over
50-999
SHORT-TERM COMMERCIAL AND
INDUSTRIAL LOANS
1
2
3
4
Amount of loans (thousand of dollars)
Number of loans
Weighted average maturity (months)
Weighted average interest rate (percent per
annum)
5
Interquartile range 1
Percentage of amount of loans
6 With floating rate
7 Made under commitment
8,107,372
128,317
3.0
696,629
97,398
3.6
369,217
11,174
3.3
431,935
6,984
3.3
1,724,393
10,369
3.5
685,208
1,062
3.9
4,199,992
1,330
2.5
15.81
15.25-16.82
14.77
12.68-16.99
14.92
13.21-16.83
15.93
14.58-17.48
15.40
13.65-16.91
16.01
15.25-16.86
16.19
15.31-16.70
52.6
49.4
17.1
19.6
21.7
26.1
44.7
38.4
36.4
43.6
66.6
61.1
66.3
58.0
LONG-TERM COMMERCIAL AND
INDUSTIRAL LOANS
8
9
10
11
Amount of loans (thousand of dollars)
Number of loans
Weighted average maturity (months)
Weighted average interest rate (rate percent per
annum)
12
Interquartile range 1
1,646,325
28,827
48.5
325,742
27,356
35.1
204,389
1,020
39.0
137,391
206
35.7
978,803
244
56.7
15.55
15.25-16.50
14.76
13.00-16.14
15.66
15.00-17.23
15.43
15.25-17.00
15.81
15.25-16.25
71.7
63.3
27.8
33.1
66.4
60.3
74.1
62.0
87.0
74.1
Percentage of amount of loans
13 With floating rate
14 Made under commitment
CONSTRUCTION AND
LAND DEVELOPMENT LOANS
1,056,988
34,676
9.7
205,277
25,307
7.9
195,753
5,348
18.5
145,500
2,274
6.3
276,070
1,568
7.4
234,388
178
9.1
15.51
14.49-17.25
14.20
11.77-16.31
15.73
14.58-17.18
15.72
13.75-16.99
15.83
14.50-17.60
15.%
15.50-17.50
Percentage of amount of loans
20 With floating rate
21 Secured by real estate
22 Made under commitment
40.2
76.9
40.4
16.2
70.2
31.3
12.8
65.8
26.4
29.6
61.1
31.2
58.2
90.9
53.0
69.7
85.3
50.9
Type of construction
23 1- to 4-family
24 Multifamily
25 Nonresidential
38.7
7.4
53.9
58.5
1.3
40.2
49.4
1.5
49.1
20.4
4.7
74.8
44.2
10.9
45.0
17.3
15.1
67.5
15
16
17
18
Amount of loans (thousand of dollars)
Number of loans
Weighted average maturity (months)
Weighted average interest rate (percent per
annum
19
Interquartile range 1
All
sizes
250
1-9
10-24
25-49
50-99
100-249
and over
LOANS TO FARMERS
26
27
28
29
30
31
32
33
24
35
Amount of loans (thousands of dollars)
Number of loans
Weighted average maturity (months)
Weighted average interest rate (percent per
Interquartile range 1
By purpose of loan
Feeder livestock
Other livestock
Other current operating expenses
Farm machinery and equipment
Other
1 , 1 % ,869
65,936
6.9
160,264
42,480
7.3
184,426
12,830
7.1
181,529
4,933
6.9
234,651
3,610
7.3
248,311
1,674
5.8
187,688
13.63
12.42-14.49
12.88
11.83-13.80
13.20
11.72-14.42
13.32
12.00-14.41
13.11
12.00-14.00
13.86
13.42-13.80
15.35
13.42-17.55
13.51
12.92
13.64
13.16
14.55
12.03
12.17
13.03
13.03
13.39
13.20
12.55
13.28
13.75
12.94
12.87
14.19
13.81
13.53
13.30
13.44
11.57
12.%
12.09
14.16
(215.45
)
(214.22
)
13.45
(215.24
)
1. Interest rate range that covers the middle 50 percent of the total dollar amount
of loans made.
2. Fewer than 10 sample loans.
409
7.3
NOTE. For more detail, see the Board's E.2(416) statistical release,
14.64
(2
L ,
16.77
Securities Markets
1.36
All
INTEREST RATES Money and Capital Markets
Averages, percent per annum
1979
Instrument
1977
1978
1980
1980, week ending
1979
Oct.
Nov.
Dec.
Jan.
Jan. 5
Jan. 12
Jan. 19
Jan. 26
Feb. 2
Money market rates
1 Federal funds 1
Commercial paper 2 - 3
1-month
3-month
6-month
Finance paper, directly placed2-3
5
1-month
6 3-month
7 6-month
8 Prime bankers acceptances, 90-day3 4
Certificates of deposit, secondary market 5
9
1-month
10 3-month
11 6-month
12 Eurodollar deposits, 3-month 6
2
3
4
U.S. Treasury bills3-7
Secondary market
3-month
6-month
1-year
Auction average 8
16
3-month
17
6-month
13
14
15
5.54
7.94
11.20
13.77
13.18
13.78
13.82
14.04
13.94
13.91
13.77
13.54
5.42
5.54
5.60
7.76
7.94
7.99
10.86
10.97
10.91
13.06
13.23
13.23
13.34
13.57
13.26
13.35
13.24
12.80
13.07
13.04
12.66
13.26
13.11
12.64
13.08
13.02
12.56
13.01
12.97
12.63
13.05
13.06
12.71
13.02
13.06
12.80
5.38
5.49
5.50
5.59
7.73
7.80
7.78
8.11
10.78
10.47
10.25
11.04
12.85
12.24
11.50
13.44
13.25
12.52
12.00
13.53
13.27
11.74
11.68
13.31
13.01
11.96
11.79
13.15
13.32
11.89
11.73
13.29
12.97
11.95
11.79
13.09
12.96
11.97
11.75
13.04
12.96
11.98
11.82
13.24
12.96
12.03
11.83
13.11
5.48
5.64
5.92
6.05
7.88
8.22
8.61
8.74
11.03
11.22
11.44
11.96
13.36
13.66
13.83
14.59
13.60
13.90
13.97
15.00
13.36
13.43
13.42
14.51
13.26
13.39
13.48
14.33
13.34
13.45
13.49
14.58
13.30
13.38
13.39
14.56
13.21
13.33
13.34
14.18
13.29
13.42
13.57
14.20
13.16
13.36
13.59
14.41
5.27
5.53
5.71
7.19
7.58
7.74
10.07
10.06
9.75
11.70
11.66
11.23
11.79
11.82
11.22
12.04
11.84
10.92
12.00
11.84
10.96
12.10
11.93
10.97
11.72
11.73
10.78
11.91
11.77
10.83
12.17
11.88
11.05
12.15
11.96
11.23
5.265
5.510
7.221
7.572
10.041
10.017
11.472
11.339
11.868
11.856
12.071
11.847
12.036
11.851
12.105
11.880
11.943
11.858
11.904
11.783
12.189
11.886
12.038
11.846
Capital market rates
U . S . TREASURY NOTES AND BONDS
18
19
20
21
22
23
24
25
26
27
Constant maturities 9
1-year
2-year
2^-year 10
3-year
4-year10
5-year
7-year
10-year
20-year
30-year
28
29
Composite 11
3 to 5 years
Over 10 years (long-term)
6.09
6.45
8.34
8.34
10.67
10.12
12.44
11.49
12.39
11.81
11.98
11.39
10 90
10.71
12.06
11.50
11.15
10.88
12.02
11.39
11.90
11.27
11.92
11.37
12.11
11.63
12.36
11.86
10.75
10.69
10.78
10.96
11.24
10.42
10.42
10.39
10.18
10.12
10.74
10.77
10.80
10.65
10.60
10.52
10.52
10.52
10.30
10.25
10.54
10.57
10.59
10.35
10.31
10.64
10.66
10.71
10.52
10.46
10.87
10.91
10.95
10.86
10.80
11.15
11.17
11.19
11.19
11.12
6.69
8.29
9.71
6.99
7.23
7.42
7.67
8.32
8.36
8.41
8.48
8.49
9.52
9.48
9.44
9.33
9.29
10.95
11.55
10.63
10.47
10.30
9.99
9.85
11.18
10.85
10.93
10.80
10.65
10.37
10.30
6.85
7.06
8.30
7.89
9.58
8.74
10.75
9.44
10.98
9.80
10.45
9.59
10.76
10.03
10.59
9.73
10.58
9.80
10.66
9.93
10.87
10.20
11.13
10.48
5.20
6.12
5.68
5.52
6.27
6.03
5.92
6.73
6.52
6.25
7.34
7.08
6.49
7.66
7.30
6.50
7.42
7.22
6.58
7.60
7.35
6.50
7.60
7.32
6.60
7.60
7.30
6.60
7.60
7.28
6.60
7.60
7.33
6.80
7.60
7.52
STATE AND LOCAL NOTES AND BONDS
Moody's series12
30 Aaa
31 Baa
32 Bond Buyer series 13
CORPORATE BONDS
33 Seasoned issues, all industries14
By rating groups
34 Aaa
35 Aa
36 A
37 Baa
38
39
Aaa utility bonds 15
New issue
Recently offered issues
MEMO: Dividend/price ratio 16
40 Preferred stocks
41 Common stocks
8.43
9.07
10.12
10.71
11.37
11.35
11.74
11.54
11.60
11.67
11.83
12.06
8.02
8.24
8.49
8.97
8.73
8.92
9.12
9.45
9.63
9.94
10.20
10.69
10.13
10.46
10.83
11.40
10.76
11.22
11.50
11.99
10.74
11.15
11.46
12.06
11.09
11.56
11.88
12.42
10.88
11.35
11.61
12.29
10.91
11.40
11.73
12.34
10.99
11.50
11.83
12.34
11.22
11.64
11.98
12.46
11.49
11.87
12.20
12.69
8.19
8.19
8.96
8.97
10.03
10.02
10.97
10.91
11.42
11.36
11 25
11.33
11.73
11.77
11.44
11 51
11.54
11 61
11.69
12 08
12! 11
12.35
7.60
4.56
8.25
5.28
10.06'
5.53
10.14
5.40
10.20
5.66
10.17
5.49
10.04
5.40
10.14
5.28
10.17
5.21
9.07'
5.46'
1. Weekly figures are 7-day averages of daily effective rates for the week ending
Wednesday; the daily effective rate is an average of the rates on a given day
weighted by the volume of transactions at these rates.
2. Beginning November 1977, unweighted average of offering rates quoted by
at least five dealers (in the case of commercial paper), or finance companies (in
the case of finance paper). Previously, most representative rate quoted by those
dealers and finance companies. Before Nov. 1979, maturities for data shown are
30-59 days, 90-119 days, and 120-179 days for commercial paper; and 30-59 days,
90-119 davs, and 150-179 days for finance paper.
3. Yields are quoted on a bank-discount basis.
4. Average of the midpoint of the range of daily dealer closing rates offered for
domestic issues.
5. Five-day average of rates quoted by five dealers (3-month series was previously
a 7-day average).
6. Averages of daily quotations for the week ending Wednesday.
7. Except for auction averages, yields are computed from daily closing bid prices.
8. Rates are recorded in the week in which bills are issued.
9. Yield on the more actively traded issues adjusted to constant maturities by
the U.S. Treasury, based on daily closing bid prices.
9.46'
5.56
9.95'
5.71
10. Each figure is an average of only five business days near the end of the
month. The rate for each month is used to determine the maximum interest rate
payable in the following month on small saver certificates. (See table 1.16).
11. Unweighted averages for all outstanding notes and bonds in maturity ranges
shown, based on daily closing bid prices. "Long-term" includes all bonds neither
due nor callable in less than 10 years, including several very low yielding "flower"
bonds.
12. General obligations only, based on figures for Thursday, from Moody's
Investors Service.
13. Twenty issues of mixed quality.
14. Averages of daily figures from Moody's Investors Service.
15. Compilation of the Board of Governors of the Federal Reserve System.
Issues included are long-term (20 years or more). New-issue yields are based
on quotations on date of offering; those on recently offered issues (included only
for first 4 weeks after termination of underwriter price restrictions), on Friday
close-of-business quotations.
16. Standard and Poor's corporate series. Preferred stock ratio based on a sample
of ten issues: four public utilities, four industrials, one financial, and one transportation. Common stock ratios on the 500 stocks in the price index.
A28
1.37
DomesticNonfinancialStatistics • February 1980
STOCK MARKET
Selected Statistics
1979
Indicator
1977
1978
1980
1979
Aug.
July
Sept.
Nov.
Oct.
Jan.
Dec.
Prices and trading (averages of daily figures)
Common stock prices
1 New York Stock Exchange (Dec. 31, 1965 = 50
53.67
53.76
55.67
58.38
61.19
61.89
59.27
59.02
61.75
63.74
2
3
4
5
57.84
41.07
40.91
55.23
58.30
43.25
39.23
56.74
61.82
45.20
36.46
58.65
56.24
48.85
38.88
64.43
67.71
52.48
39.26
68.40
69.17
52.21
38.39
67.21
66.68
48.07
36.58
61.64
66.45
47.61
36.55
60.64
69.82
50.59
37.29
63.21
72.67
52.61
37.08
64.22
Industrial
Transportation
Utility
Finance
6 Standard & Poor's Corporation (1941^13 = 10)1 ..
98.18
96.11
98.34
102.71
107.36
108.60
104.47
103.66
107.78
110.87
7 American Stock Exchange (Aug. 31, 1973 = 100) ..
116.18
144.56
186.56
197.63
208.29
223.00
212.33
216.58
238.83
259.54
Volume of trading (thousands of shares)
8 New York Stock Exchange
9 American Stock Exchange
20,936
2,514
28,591
3,622
32,233
4,182
32,416
3,890
35,870
4,503
37,576
5,405
37,301
5,446
31,126
3,938
35,510
5,389
52,647
9,363
•
Customer financing (end-of-period balances, in millions of dollars)
10 Regulated margin credit at brokers/dealers 2
9,993
11,035
11,615
12,019
12,236
12,178
11,483
11,083
11,615
11 Margin stock 3
12 Convertible bonds
13 Subscription issues
9,740
250
3
10,830
205
1
11,450
164
1
11,840
178
1
12,060
176
12,000
177
1
11,310
173
*
10,920
161
2
11,450
164
1
n.a.
Free credit balances at brokers4
14 Margin-account
15 Cash-account
640
2,060
835
2,510
1,050
4,060
885
3,025
910
2,995
960
3,325
950
3,490
955
3,435
1,050
4,060
1
I
f
1
Margin-account debt at brokers (percentage distributions, end of period)
16 Total
17
18
19
20
21
22
By equity class (in percent)5
Under 40
40-49
50-59
60-69
70-79
80 or more
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
18.0
36.0
23.0
11.0
6.0
5.0
33.0
28.0
18.0
10.0
6.0
5.0
16.0
31.0
24.0
14.0
8.0
7.0
19.0
28.0
28.0
12.0
7.0
6.0
14.0
26.0
31.0
14.0
8.0
7.0
16.0
26.0
30.0
14.0
8.0
6.0
27.0
31.0
20.0
10.0
6.0
6.0
17.0
31.0
25.0
13.0
7.0
7.0
t
A
100.0
16.0
31.0
24.0
14.0
8.0
7.0
n.a.
1
I
•
Special miscellaneous-account balances at brokers (end of period)
23 Total balances (million dollars) 6
Distribution by equity status (percent)
24 Net credit status
Debt status, equity of
25 60 percent or more
26
Less than 60 percent
9,910
13,092
16,290
13,280
14,130
14,460
14,800
14,995
16,290
43.4
41.3
48.5
43.5
44.1
45.3
44.5
46.5
48.5
44.9
11.7
45.1
13.6
43.6
7.9
47.1
9.4
47.8
8.1
46.4
8.3
45.5
10.0
45.0
8.5
43.6
7.9
f
1
n.a.
1
t
Margin requirements (percent of market value and effective date) 7
Mar. 11. 1968
27 Margin stocks
28 Convertible bonds
29 Short sales
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. Margin credit includes all credit extended to purchase or carry stocks or
related equity instruments and secured at least in part by stock. Credit extended
is end-of-month data for member firms of the New York Stock Exchange.
In addition to assigning a current loan value to margin stock generally, Regulations T and U permit special loan values for convertible bonds and stock acquired
through exercise of subscription rights.
3. A distribution of this total by equity class is shown on lines 17-22.
4. Free credit balances are in accounts with no unfulfilled commitments to the
brokers and are subject to withdrawal by customers on demand.
5. Each customer's equity in his collateral (market value of collateral less net
debit balance) is expressed as a percentage of current collateral values.
6. Balances that may be used by customers as the margin deposit required for
additional purchases. Balances may arise as transfers based on loan values of other
collateral in the customer's margin account or deposits of cash (usually sales proceeds) occur.
7. Regulations G, T, and U of the Federal Reserve Board of Governors, prescribed in accordance with the Securities Exchange Act or 1934, limit the amount
of credit to purchase and carry margin stocks that may be extended on securities
as collateral by prescribing a maximum loan value, which is a specified percentage
of the market value of the collateral at the time the credit is extended. Margin
requirements are the difference between the market value (100 percent) and the
maximum loan value. The term "margin stocks" is defined in the corresponding
regulation.
Thrift Institutions
1.38
SAVINGS INSTITUTIONS
A29
Selected Assets and Liabilities
Millions of dollars, end of period
1979
Account
1977
1978
Mar.
Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.P
Savings and loan associations
1 Assets
459,241
523,542
539,582
543,320
549,031
555,409
561,037
566,493
570,479
576,251
578,922
579,132
2 Mortgages
3 Cash and investment
securities1
4 Other
381,163
432,808
441,358
445,638
450,978
456.544
460.620
464,609
468.307
472,198
474,678
475,664
39,150
38,928
44,884
45,850
50,153
48,071
48,698
48.984
48.280
49,773
48,253
50.612
49,496
50,721
50.007
51.877
49,301
52.871
49.220
54.833
48,180
56,064
46,457
57,011
5 Liabilities and net worth
459,241
523,542
539,582
543,320
549,031
555,409
561,037
570,479
566,493
576,251
578,922
579,132
386,800
27,840
19,945
7,895
9,911
9,506
430,953
42,907
31,990
10,917
10.721
9.904
446,898
41,538
31,123
10,415
10,331
10,905
445,751
43,710
32,389
11,321
10,690
12.950
447,788
44,324
33.003
11,321
11,118
15,259
454.642
46.993
34.266
12.727
11,260
11.681
456,657
48.437
35,286
13,151
11,309
13,503
457,856
50,437
36,009
14.428
11.047
15.712
462,626
52.738
37.620
15.118
10.909
12.497
464.489
54.268
39,223
15.045
10,766
14.673
465,646
54,433
39,638
14,795
10,159
16,324
470.138
55,303
40,335
14,968
9,516
11,645
12 Net worth 2
25,184
29,057
29,910
30,219
30.542
30.833
31,131
31.441
31.709
32.055
32,360
32,530
13 MEMO: Mortgage loan commitments outstanding 3
19,875
18,911
21,082
22,915
23.560
22.770
22,360
22.282
22.397
20.930
18.029
15,935
6
7
8
9
10
11
Savings capital
Borrowed money
FHLBB
Other
Loans in process
Other
Mutual savings banks 4
14,287
158,174
161,866
161,231
161,380
161,814
162,598
163,388
163,431
163,133
163,205
88,195
6,210
95.157
7.195
96,136
9,421
95,900
9.290
96,239
9.444
96.743
9.577
97,238
10,282
97.637
10.430
97.973
9.982
98.304
9.510
98.610
9.449
5.895
2,828
37,918
2,401
3,839
4,959
3.333
39,732
3,665
4,131
4,814
3,126
40,658
3,410
4,300
8.193
3,326
37,211
3,072
4,239
8,148
3,264
37,304
2,785
4,198
8.029
3.175
37.281
2.764
4.245
7.992
3.154
37.171
2., 540
4,220
7.921
3,149
37,125
2,866
4.260
7,891
3.150
37.076
3,020
4,339
7.750
3.100
37.210
2,909
4.351
7.754
3,003
37.036
3,010
4.343
22 Liabilities
147,287
158,174
161,866
161,231
161,380
161,814
162,598
163,388
163,431
163,133
163,205
23
24
25
26
27
28
29
30
134,017
132,744
78,005
54,739
1,272
3,292
9,978
142,701
141,170
71.816
69.354
1.531
4,565
10.907
145,650
144,042
68,829
75,213
1,608
5,048
11,167
145,096
143.210
67,758
75.452
1.886
5.050
11.085
145,056
143.271
67,577
75,694
1,784
5,172
11.153
146.057
144.161
68.104
76.057
1.896
4,545
11.212
145,757
143,843
67.537
76,306
1,914
5.578
11,264
145,713
143,731
66,733
76,998
1.982
6,350
11,324
146.252
144,258
65,676
78.572
2,003
5,790
11,388
145,096
143.263
62.672
80.591
1,834
6,600
11.437
144,828
143,064
61,156
81,908
1,764
6,872
11,504
4,066
4,400
4,482
4,449
4.352
4.469
4,214
4,071
4,123
3,749
3,619
1r
ii
ii
n.a.
n.a.
14 Assets
15
16
17
18
19
20
21
Loans
Mortgage
Other
Securities
U.S. government 5
State and local government ....
Corporate and other 6
Cash
Other assets
Deposits
Regular 7
Ordinary savings
Time and other
Other
Other liabilities
General reserve accounts
MEMO: Mortgage loan commitments outstanding 8
ii
n.a.
Life insurance companies
31 Assets
Securities
Government
United States 9
State and local
Foreign 10
Business
Bonds
Stocks
Mortgages
Real estate
Policy loans
Other assets
32
33
34
35
36
37
38
39
40
41
42
351,722
389,924
399,579
402,963
405,627
409,853
414,120
418,350
421,660
423,760
19,553
5,315
6,051
8,187
175,654
141,891
33,763
96,848
11,060
27,556
21,051
20,009
4,822
6,402
8,785
198,105
162,587
35,548
106,167
11,764
30,146
23,733
20,463
5,234
6,259
8,970
204,895
168,622
36,273
108,417
11,484
31,160
23,160
20,510
5,272
6,268
8,970
206,160
169,817
36,343
109,198
12,086
31,512
23,497
20,381
5,149
6,272
8,960
207,775
171.762
36,013
110,023
12,101
31.832
23,515
20,397
5.178
6,.241
8,978
209,804
173.130
36.674
111,123
12.199
32.131
24.199
20.468
5.228
6,243
8,997
212,876
175,854
37.022
112,120
12.351
32,390
23,915
20,472
5,229
6,258
8,985
215,252
176,920
38,332
113,102
12.738
32.713
24,073
20,379
5.067
6,295
9,017
216,500
177,698
38,802
114,368
12,740
33,046
24,627
20,429
5.075
6,339
9,015
216.183
178.633
37.550
115.991
12.816
33,574
24,767
Credit unions
43 Total assets/liabilities and
capital
53,755
62,348
63,671
63,030
64,158
65,435
68,840
65,547
66,280
65,063
65,419
65,854
44
45
46
47
48
49
50
51
29,564
24,191
41,845
22,634
19,211
46,516
25,576
20,940
34,760
27,588
50,269
27,687
22,582
53.517
29,802
23,715
35,406
28,265
50,828
27,961
22,867
54,713
30,212
24,501
34.758
28,272
50.846
27,869
27,977
54,199
29.796
24,403
35,379
28,779
51,351
28,103
23,248
55,107
30,222
24,885
36,146
29,289
52,028
28.487
23.541
56.437
31,048
25,839
35,413
29,427
52,083
28,379
23,704
56,393
30,732
25,661
35,724
29,823
52,970
28,848
24,122
56,583
30,761
25,822
36,151
30,129
53,545
29,129
24,416
57,255
31,097
26,158
35,537
29,526
53,533
29,020
24,513
55,739
30,366
25,373
35,670
29,749
56,267
30,613
25,654
55,797
30,399
25,398
35,934
29,920
53,125
28,698
24,426
56,232
35,530
25,702
Federal
State
Loans outstanding
Federal
State
Savings
Federal (shares)
State (shares and deposits) ....
For notes see bottom of page A30.
A30
1.39
Domestic Financial Statistics • February 1980
FEDERAL FISCAL AND FINANCING OPERATIONS
Millions of dollars
Calendar year
Type of account or operation
Fiscal
year
1977
Fiscal
year
1978
Fiscal
year
1979
1978
H2
U.S. budget
1 Receipts'
2 Outlays1
3 Surplus, or deficit( - )
4 Trust funds
5
Federal funds 2
Off-budget entities surplus, or
deficit ( - )
6 Federal Financing Bank outlays
7 Other 3
U.S. budget plus off-budget, including
Federal Financing Bank
8 Surplus, or deficit ( - )
Source or financing
9
Borrowing from the public
10 Cash and monetary assets (decrease, or increase ( - ) ) 4
11 Other 5
1979
HI
1979
H2
Oct.
Nov.
Dec.
357,762
402,725
-44,963
9,497
-54,460
401,997
450,938
-48,940
12,693
-61,633
465,940
493,221
-27,281
18,335
-45,616
206,275
238,186
-31,912
11,754
-43,666
246,574
245,616
958
4,041
-4,999
233,952
263,044
-29,093
9,679
-38,773
33,099
47,807
-14,708
-6,555
-8,153
38,320
46,841
-8,522
8,108
-16,630
42,617
44,010
-1,393
565
-1,959
-8,415
-264
-10,661
355
-13,261
832
-5,082
1,843
-7,712
-447
-5,909
805
-1,536
1,598
-538
118
-735
131
-53,642
-59,246
-39,710
-35,151
-7,201
-34,197
-14,646
-8,942
-1,997
53,516
-59,106
33,641
30,314
6,039
31,320
2,217
5.548
11,207
-2,247
2,373
-3,023
3,163
-408
6,477
3,381
1,456
-8,878
10,040
3,059
-182
14.220
-1,791
4,533
-1,139
-10,378
-1,168
19,104
15,740
3,364
22,444
16,647
5,797
24,176
6,489
17,687
16,291
4,196
12,095
17,485
3,290
14,195
15,924
4,075
11,849
10,460
2,209
8,251
5,591
2,590
3,001
15,924
4,075
11,849
MEMO:
12 Treasury operating balance (level, end of
period)
13 Federal Reserve Banks
14 Tax and loan accounts
1. Effective June 1978, earned income credit payments in excess of an individual's tax liability, formerly treated as income tax refunds, are classified as
outlays retroactive to January 1976.
2. Half-year figures calculated as a residual (total surplus/deficit less trust fund
surplus/deficit).
3. Includes Pension Benefit Guaranty Corp.; Postal Service Fund; Rural Electrification and Telephone Revolving Fund; and Rural Telephone Bank.
4. Includes U.S. Treasury operating cash accounts; special drawing rights; gold
tranche drawing rights; loans to International Monetary Fund; and other cash and
monetary assets.
5. Includes accrued interest payable to the public; deposit funds; miscellaneous
liability (including checks outstanding) and asset accounts; seignorage; increment
on gold; net gain/loss for U.S. currency valuation adjustment; net gain/loss for IMF
valuation adjustment; and profit on the sale of gold.
SOURCE. "Monthly Treasury Statement of Receipts and Outlays of the U.S.
Government," Treasury Bulletin, and the Budget of the United States Government,
Fiscal Year 1980.
NOTES TO TABLE 1.38
1. Holdings of stock of the Federal Home Loan Banks are included in "other
assets."
2. Includes net undistributed income, which is accrued by most, but not all,
associations.
3. Excludes figures for loans in process, which are shown as a liability.
4. The NAMSB reports that, effective April 1979, balance sheet data are not
strictly comparable with previous months. Beginning April 1979, data are reported
on a net-of-valuation-reserves basis. Prior to that date, data were reported on a
gross-of-valuation-reserves basis.
5. Begining April 1979, includes obligations of U.S. government agencies. Prior
to that date, this item was included in "Corporate and other."
6. Includes securities of foreign governments and international organizations
and, prior to April 1979, nonguaranteed issues of U.S. government agencies.
7. Excludes checking, club, and school accounts.
8. Commitments outstanding (including loans in process) of banks in New York
State as reported to the Savings Banks Association of the State of New York.
9. Direct and guaranteed obligations. Excludes federal agency issues not guaranteed, which are shown in the table under "business" securities.
10. Issues of foreign governments and their subdivisions and bonds of the International Bank for Reconstruction and DEvelopment.
NOTE. Savings and loan associations: Estimates by the FHLBB for all associations in the United States. Data are based on monthly reports of federally insured
associations and annual reports of other associations. Even when revised, data for
current and preceding year are subject to further revision.
Mutual savings banks: Estimates of National Association of Mutual Savings
Banks for all savings banks in the United States.
Life insurance companies: Estimates of the American Council of Life Insurance
for all life insurance companies in the United States. Annual figures are annualstatement asset values, with bonds carried on an amortized basis and stocks at
year-end market value. Adjustments for interest due and accrued and for differences between market and book values are not made on each item separately but
are included, in total, in "other assets."
Credit unions: Estimates by the National Credit Union Administration for a
group of federal and state-chartered credit unions that account for about 30 percent
of credit union assets. Figures are preliminary and revised annually to incorporate
recent benchmark data.
Federal Finance
1.40
A31
U.S. BUDGET RECEIPTS AND OUTLAYS
Millions of dollars
Calendar year
Fiscal
year
Fiscal
year
1977
Source or type
Fiscal
year
1978
1979
1979
1978
1979
H2
HI
H2
Nov.
Oct.
Dec.
RECEIPTS
1
All sources1
357,762
401,997
465,940
206,275
246,574
233,952
33,099
38,320
42,617
2
3
157,626
144,820
180,988
165,215
217,841
195,295
98,854
90,148
111,603
98,683
115,488
105,764
18,682
17,777
18,972
18,725
20,192
19,402
37
42,062
29,293
39
47,804
32,070
36
56,215
33,705
3
10,777
2,075
32
44,116
31,228
3
12,355
2,634
0
1,183
278
0
589
342
0
952
163
60,057
5,164
65,380
5,428
71,448
5,771
28,536
2,757
42,427
2,889
29,169
3,306
2,543
1,068
1,684
523
10,667
460
108,683
123,410
141,591
61,064
75,609
71,031
9,384
14,433
8,675
88,196
99,626
115,041
51,052
59,298
60,562
8,013
12,259
7,963
12
13
Individual income taxes, net
Withheld
Presidential Election Campaign
Fund
Nonwithheld
Refunds 1
Corporation income taxes
Gross receipts
Refunds
Social insurance taxes and contributions, net
Payroll employment taxes and
contributions 2
Self-employment taxes and
contributions 3
Unemployment insurance
Other net receipts 4
4,014
11,312
5,162
4,267
13,850
5,668
5,034
15,387
6,130
369
6,727
2,917
4,616
8,623
3,072
417
6,899
3,149
0
840
530
0
1,650
524
0
204
507
14
15
16
17
Excise taxes
Customs deposits
Estate and gift taxes
Miscellaneous receipts 5
17,548
5,150
7,327
6,536
18,376
6,573
5,285
7,413
18,745
7,439
5,411
9,237
9,879
3,748
2,691
4,260
8,984
3,682
2,657
4,501
9,675
3,741
2,900
5,254
1,547
646
526
838
1,653
605
518
977
1,658
595
425
866
18
All types1
4
5
6
7
8
9
10
11
OUTLAYS
402,725
450,938
493,221
238,186
245,616
263,044
47,807
46,841
44,010
National defense
International affairs
General science, space, and
technology
22 Energy
23 Natural resources and environment
2 4 Agriculture
97,501
4,813
105,192
6,083
116,491
5,419
55,124
2,060
57,643
3,538
62,002
4,617
10,448
1,263
10,734
1,190
10,566
899
4,677
4,172
10,000
5,532
4,,721
5,901
11,167
7,618
5,620
7,855
12,346
6,410
2,383
4,279
6,020
4,967
2,461
4,417
5,672
3,020
3,299
3,281
7,350
1,709
451
52
1,433
402
515
643
538
769
432
625
1,597
1,150
Commerce and housing credit
Transportation
Community and regional
development
2 8 Education, training, employment,
social services
2 9 Health
1
30 Income security
-44
14,636
3,319
15,462
2,592
17,013
3,292
8,740
60
7,688
3 ,,002
10,298
2,078
1,923
222
1,670
516
1,862
19
20
21
25
26
27
31
32
33
34
35
36
Veterans benefits and services
Administration of justice
General government
General-purpose fiscal assistance
Interest 6
Undistributed offsetting receipts 6 7
6,286
11,263
9,735
5,844
4,499
4,855
630
973
614
20,985
38,785
137,915
25,890
43,676
146,503
28,524
49,614
160,496
14,247
23,830
73,127
14,467
24,860
81,173
14,579
26,492
86,007
2,330
4,662
14,477
2,330
4,449
15,370
2,461
4,532
14,286
18,038
3,600
3,374
9,499
38,009
-15,053
18,987
3,786
3,723
9,377
44,040
-15,772
19,916
4,138
4,671
8,234
52,634
-18,489
9,532
1,989
2,304
4,610
24,036
-8,199
10,127
2,096
2,291
3,890
26,934
-8,999
10,113
2,174
2,103
4,286
29,045
-12,164
1,809
460
209
1,822
4,082
-722
2,701
350
342
378
4,719
-1,052
1,778
350
422
102
8,695
-6,879
1. Effective June 1978, earned income credit payments in excess of an individual's tax liability, formerly treated as income tax refunds, are classified as
outlays retroactive to January 1976.
2. Old-age, disability, and hospital insurance, and railroad retirement accounts.
3. Old-age, disability, and hospital insurance.
4. Supplementary medical insurance premiums, federal employee retirement
contributions, and Civil Service retirement and disability fund.
5. Deposits of earnings by Federal Reserve Banks and other miscellaneous receipts.
6. Effective September 1976, "Interest" and "Undistributed Offsetting Receipts" reflect the accounting conversion for the interest on special issues for U.S.
government accounts from an accrual basis to a cash basis.
7. Consists of interest received by trust funds, rents and royalties on the Outer
Continental Shelf, and U.S. government contributions for employee retirement.
SOURCE. "Monthly Treasury Statement of Receipts and Outlays of the U.S.
Government" and the Budget of the U.S. Government, Fiscal Year 1980.
A32
Domestic Financial Statistics • February 1980
1.41
FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION
Billions of dollars
1977
1978
1979
Item
June 30
Sept. 30
Dec. 31
June 30
Sept. 30
Dec. 31
Mar. 31
June 30
Sept. 30
1 Federal debt outstanding
685.2
709.1
729.2
758.8
780.4
797.7
804.6
812.2
833.8
2 Public debt securities
3
Held by public
4
Held by agencies
674.4
523.2
151.2
698.8
543.4
155.5
718.9
564.1
154.8
749.0
587.9
161.1
771.5
603.6
168.0
789.2
619.2
170.0
796.8
630.5
166.3
804.9
626.4
178.5
826.5
638.8
187.7
10.8
9.0
1.8
10.3
8.5
1.8
10.2
8.4
1.8
9.8
8.0
1.8
8.9
7.4
1.5
8.5
7.0
1.5
7.8
6.3
1.5
7.3
5.9
1.5
7.2
5.8
1.5
5 Agency securities
6
Held by public
7
Held by agencies
675.6
700.0
720.1
750.2
772.7
790.3
797.9
806.0
827.6
9 Public debt securities
10 Other debt 1
673.8
1.7
698.2
1.7
718.3
1.7
748.4
1.8
770.9
1.8
788.6
1.7
796.2
1.7
804.3
1.7
825.9
1.7
11 MEMO. Statutory debt limit
700.0
700.0
752.0
752.0
798.0
798.0
798.0
830.0
830.0
8 Debt subject to statutory limit
1. Includes guaranteed debt of government agencies, specified participation certificates, notes to international lending organizations, and District of Columbia
stadium bonds.
1.42
GROSS PUBLIC DEBT OF U.S. TREASURY
NOTE. Data from Treasury Bulletin (U.S. Treasury Department),
Types and Ownership
Billions of dollars, end of period
1979
Type and holder
1976
1975
1977
Sept.
1 Total gross public debt
2
3
4
5
6
7
8
9
10
11
12
13
14
By type
Interest-bearing debt
Marketable
Bills
Notes
Bonds
Nonmarketable 1
Convertible bonds 2
State and local government series
Foreign issues3
Government
Public
Savings bonds and notes
Government account series4
15 Non-interest-bearing debt
16
17
18
19
20
21
22
23
By holder5
U.S. government agencies and trust funds
Federal Reserve Banks
Private investors
Commercial banks
Mutual savings banks
Insurance companies
Other companies
State and local governments
Individuals
Savings bonds
24
Other securities
25
26 Foreign and international 6
27 Other miscellaneous investors7
Oct.
Nov.
Jan.
Dec.
576.6
653.5
718.9
789.2
826.5
826.8
833.8
845.1
847.7
575.7
363.2
157.5
167.1
38.6
212.5
2.3
1.2
21.6
21.6
0
67.9
119.4
652.5
421.3
164.0
216.7
40.6
231.2
2.3
4.5
22.3
22.3
0
72.3
129.7
715.2
459.9
161.1
251.8
47.0
255.3
2.2
13.9
22.2
22.2
0
77.0
139.8
782.4
487.5
161.7
265.8
60.0
294.8
2.2
24.3
29.6
28.0
1.6
80.9
157.5
819.0
506.7
161.4
274.2
71.1
312.3
2.2
24.6
28.1
24.0
4.2
80.0
176.4
825.7
515.0
161.7
280.8
72.5
310.7
2.2
24.4
28.0
23.9
4.2
80.5
175.3
832.7
519.6
165.1
279.7
74.8
313.2
2.2
24.5
29.2
23.9
5.3
80.0
177.0
844.0
530.7
172.6
283.4
74.7
313.2
2.2
24.6
28.8
23.6
5.3
79.9
177.5
846.5
535.7
175.5
284.0
76.1
310.9
2.2
24.8
30.0
23.6
6.4
78.6
174.9
1.0
1.1
3.7
6.8
7.5
1.1
1.1
1.2
1.2
139.1
89.8
349.4
85.1
4.5
9.5
20.2
34.2
147.1
97.0
409.5
103.8
5.9
12.7
27.7
41.6
154.8
102.5
461.3
101.4
5.9
15.1
22.7
55.2
170.0
109.6
508.6
93.4
5.2
15.0
20.6
68.6
187.7
115.8'
524.0
92.3
4.7
14.6
23.7
68.9
185.7
114.6
526.5
93.5
4.5
14.8
24.1
69.7
187.1
118.1
528.6
95.0
4.3
14.4
24.0
68.2
67.3
24.0
66.5
38.0
72.0
28.8
78.1
38.9
76.7
28.6
109.6
46.1
80.7
30.0
137.8
57.4
80.6
32.6
125.2
81.3
80.5
32.9
124.4
82.0
80.1
33.7
120.6
88.3
1. Includes (not shown separately): Securities issued to the Rural Electrification
Administration, depositary bonds, retirement plan bonds, and individual retirement bonds.
2. These nonmarketable bonds, also known as Investment Series B Bonds, may
be exchanged (or converted) at the owner's option for 1 Vi percent, 5-year marketable Treasury notes. Convertible bonds that have been so exchanged are removed from this category and recorded in the notes category above.
3. Nonmarketable dollar-denominated and foreign currency denominated series
held by foreigners.
4. Held almost entirely by U.S. government agencies and trust funds.
5. Data for Federal Reserve Banks and U.S. government agencies and trust
funds are actual holdings; data for other groups are Treasury estimates.
1980
1978
ii
i
n. a.
n. a.
i
6. Consists of the investments of foreign balances and international accounts in
the United States. Beginning with July 1974, the figures exclude non-interestbearing notes issued to the International Monetary Fund.
7. Includes savings and loan associations, nonprofit institutions, corporate pension trust funds, dealers and brokers, certain government deposit accounts, and
government sponsored agencies.
NOTE. Gross public debt excludes guaranteed agency securities and, beginning
in July 1974, includes Federal Financing Bank security issues.
Data by type of security from Monthly Statement of the Public Debt of the United
States (U.S. Treasury Department); data by holder from Treasury Bulletin.
Federal Finance
1.43
U.S. GOVERNMENT MARKETABLE SECURITIES
A33
Ownership, by maturity
Par value; millions of dollars, end of period
1979
1979
Type of holder
1977
1978
1977
1978
Nov.
Oct.
Oct.
Nov.
1 to 5 years
All maturities
1 All holders
459,927
487,546
515,124
520,573
151,264
162,886
164,448
164,395
2 U.S. government agencies and trust funds
3 Federal Reserve Banks
14,420
101,191
12,695
109,616
11.379
114,580
11,047
108,087
4,788
27,012
3,310
31,283
3,099
27,139
2,560
27,554
344,315
75,363
4,379
12,378
9,474
4,817
15,495
222,409
365,235
68,890
3,499
11,635
8,272
3,835
18,815
250,288
389,165
67,575
3,100
12,005
9,146
3,512
18,145
275,682
401,439
67,771
3,280
11,645
8,918
3,370
15,999
290,457
119,464
38,691
2,112
4,729
3,183
2,368
3,875
64,505
128,293
38,390
1,918
4,664
3,635
2,255
3,997
73,433
134,210
37,663
1,626
5,138
3,337
1,980
3,946
80,519
134,281
37,734
1,700
4,573
3,238
1,944
3,613
81,478
4 Private investors
5 Commercial banks
6 Mutual savings banks
7
Insurance companies
8
Nonfinancial corporations
9
Savings and loan associations
10 State and local governments
11 All others
5 to 10 years
Total, within 1 year
12 All holders
13 U.S. government agencies and trust funds
14 Federal Reserve Banks
15 Private investors
16 Commercial banks
17 Mutual savings banks
18 Insurance companies
19 Nonfinancial corporations
20
Savings and loan associations
21 State and local governments
22 All others
230,691
228,516
246,462
247,397
45,328
50,400
45,500
47,904
1,989
14,809
872
12,303
871
12,714
33,601
7,490
496
2,899
369
89
1,588
20,671
32,325
6,982
465
2,608
267
68
1,694
20,241
34,319
7,064
461
2,736
259
64
1,509
22,225
1,906
56,702
1,488
52,801
1,416
62,754
1,624
55,101
2,129
10,404
172,084
29,477
1,400
2,398
5,770
2,236
7,917
122,885
174,227
20,608
817
1,838
4,048
1,414
8,194
137,309
182,292
20,410
790
1,918
5,105
1,390
6,169
146,510
190,671
20,357
870
2,068
4,977
1,285
5,795
155,319
32,795
6,162
584
3,204
307
143
1,283
21,112
10 to 20 years
Bills, within 1 year
23 All holders
24 U.S. government agencies and trust funds
25 Federal Reserve Banks
26 Private investors
27
Commercial banks
28 Mutual savings banks
29 Insurance companies
30
Nonfinancial corporations
31 Savings and loan associations
32
State and local governments
33 All others
161,747
161,692
32
42,004
2
42,397
*
44,072
0
37,310
119,035
11,996
484
1,187
4,329
806
6,,092
94,152
119,348
5,707
150
753
1,792
262
5,524
105,161
117,619
5,138
167
455
2,562
202
3,241
105,854
127,790
5,863
282
466
2,632
217
3,091
115,240
161,081
165,100
19,800
27,778
27,624
3,102
1,510
3,876
2,088
4,520
3,229
4,520
3,239
8,295
456
137
1,245
133
54
890
5,380
13,836
956
143
1,460
86
60
1,420
9,711
20,029
1,072
124
1,389
276
58
2,033
15,077
19,866
1,017
134
1,394
230
58
1,769
15,263
12,906
Over 20 years
Other, within 1 year
34 All holders
69,610
66,769
84,770
82,297
19,738
25,944
30,937
33,253
35 U.S. government agencies and trust funds
36 Federal Reserve Banks
1,874
14,698
1,487
10,404
1,416
18,682
1,624
17,791
2,495
5,564
2,031
8,635
1,472
9,156
1,472
9,479
37 Private investors
38 Commercial banks
39 Mutual savings banks
40 Insurance companies
41 Nonfinancial corporations
42 Savings and loan associations
43 State and local governments
44 All others
53,039
15,482
916
1,211
1,441
1,430
1,825
28,733
54,879
14,901
667
1,084
2,256
1,152
2,670
32,149
64,672
15,272
623
1,463
2,543
1,188
2,928
40,655
62,881
14,494
589
1,603
2,345
1,068
2,704
40,078
11,679
578
146
802
81
16
1,530
8,526
15,278
1,446
126
774
135
17
3,616
9,164
20,309
1,449
94
952
161
15
4,303
13,335
22.302
1,599
113
873
213
19
3,314
16,172
NOTE. Direct public issues only. Based on Treasury Survey of Ownership from
Treasury Bulletin (U.S. Treasury Department).
Data complete for U.S. government agencies and trust funds and Federal Reserve Banks, but data for other groups include only holdings of those institutions
that report. The following figures show, for each category, the number and proportion r e p o r t i n g as of Nov. 30, 1979: (1) 5,399 commercial
banks, 460 mutual savings banks, and 724 insurance companies, each about 80
percent; (2) 419 nonfinancial corporations and 483 savings and loan associations,
each about 50 percent; and (3) 491 state and local governments, about 40 percent.
"All others," a residual, includes holdings of all those not reporting in the
Treasury Survey, including investor groups not listed separately.
A34
1.44
DomesticNonfinancialStatistics • February 1980
U.S. GOVERNMENT SECURITIES DEALERS
Transactions
Par value; averages of daily figures, in millions of dollars
1979, week ending Wednesday
1976
Nov.
1 U.S. government securities
2
3
4
5
6
Bv maturity
Bills
Other within 1 year
1-5 years
5-10 years
Over 10 years
By type of customer
7 U.S. government securities
dealers
8 U.S. government securities
brokers
9 Commercial banks
10 All others'
Oct. 17
Oct. 24
Oct. 31
Nov. 7
Nov. 14
14,485
14,585
14,410
12,880
15,252
17,237
8,144
357
3,764
961
1,259
8,223
414
2,498
1,034
2,416
7,983
361
3,527
981
1,558
6,736
495
3,682
888
1,079
8,293
299
2,722
1,650
2,288
9,908
663
3,348
1,683
1,635
10,449
10,838
6,676
210
2.317
1.019
229
6.746
237
2,320
1,148
388
6,173
392
1,889
965
866
1,135
1,613
1,973
1.719
1,222
1,901
1,157
1,433
1,966
3.407
2,426
3,257
3,709
2,295
3,568
3,838
1,804
3,508
6.123
1,823
4,288
6,439
2,259
6,005
6.296
2.033
6.596
6,607
2,103
4,553
6,401
1,839
4,444
7.018
1,826
4,409
5,789
1,734
3,925
5,532
2,160
5,594
7,207
2,407
5,425
1,894
3,151
3,324
3,225
3,113
3,230
3,059
3,583
2,921
3,533
11 Federal agency securities ..
7,856
430
3,076
955
1,529
1. Includes, among others, all other dealers and brokers in commodities and
securities, foreign banking agencies, and the Federal Reserve System.
NOTE. Averages for transactions are based on number of trading days in the
period.
1.45
Oct. 10
U.S. GOVERNMENT SECURITIES DEALERS
9,787
607
3,119
1,592
1,572
10,232
560
2.520
1,292
1,026
Transactions are market purchases and sales of U.S. government securities dealers reporting to the Federal Reserve Bank of New York. The figures exclude
allotments of, and exchanges for, new U.S. government securities, redemptions
of called or matured securities, or purchases or sales of securities under repurchase,
reverse repurchase (resale), or similar contracts.
Positions and Sources of Financing
Par value; averages of daily figures, in millions of dollars
1979
Item
1976
1977
1979, week ending Wednesday
1978
Oct.
Nov.
Dec./'
Sept. 19
Sept. 26
Oct. 3
Oct. 10
Oct. 17
Oct. 24
Positions 1
1 U.S. government securities
7,592
5,172
2,656
700
3,,931
3,900
999
915
-693
653
1,157
671
2
3
4
5
6
6,290
188
515
402
198
4,772
99
60
92
149
2,452
260
-92
40
-4
2,291
-800
- 535
17
-272
4.446
-896
- 197
347
231
5,760
- 1,548
-681
385
57
2,603
-259
- 1,146
132
- 332
2,414
-422
- 1,068
174
- 184
1,805
-878
-1,461
129
-288
2,102
-799
-307
61
-405
2,771
-828
-641
59
-206
2,399
-735
-788
-7
-199
729
693
606
1,809
1,534
1,308
1,966
2,549
2,280
1,947
1,824
1,567
Bills
Other within 1 year
1-5 years
5-10 years
Over 10 years
7 Federal agency securities .
Financing
8 AH sources
9
10
11
12
Commercial banks
New York City
Outside New York City
Corporations 3
All others
8,715
9,877
10,204
16,021
19,122
21,391
18,047
18,697
16,946
15,711
16,628
16,744
1.896
1,660
1,479
3,681
1,313
1,987
2,423
4,155
599
2,174
2,370
5,052
1.152
3.247
3.131
8.491
1.778
3,386
4,102
9,857
1,729
3,778
4,832
11,054
1,501
3,682
4,074
8,789
1,373
3,438
3,765
10,122
1,035
3,483
3,117
9,311
1,406
3,368
3.120
7,816
1,463
3,637
3,123
8,403
1,220
3,227
3,312
8,985
1. New ammounts (in terms of par values) of securities owned by nonbankdealer
firms and dealer department of commercial banks on a commitment, that is, tradedate basis, including any such securities that have been sold under agreements to
repurchase. The maturities of some repurchase agreements are sufficiently long,
however, to suggest that the securities involved are not available for trading purposes. Securities owned, and hence dealer positions, do not include securities
purchased under agreement to resell.
2. Total amounts outstanding of funds borrowed by nonbank dealer firms and
dealer departments of commercial banks against U.S. government and federal
2
agency securities (through both collateral loans and sales under agreements to
repurchase), plus internal funds used by bank dealer departments to finance positions in such securities. Borrowings against securities held under agreeementto
resell are excluded where the borrowing contract and the agreement to resell are
equal in amount and maturity, that is, a matched agreement.
3. All business corporations except commercial banks and insurance companies.
NOTE. Averages for positions are based on number of trading days in the period;
those for financing, on the number of calendar days in the period.
Federal Finance
1.46
A35
FEDERAL AND FEDERALLY SPONSORED CREDIT AGENCIES Debt outstanding
Millions of dollars, end of period
1979
Agency
1976
1977
1978
May
1 Federal and federally sponsored agencies1
June
July
Aug.
Sept.
Oct.
103,848
112,472
137,063
146,429
149,612
152,653
153,788
154,753
158,300
2 Federal agencies
3
Defense Department 2
4
Export-Import Bank3-4
5
Federal Housing Administration 5
6
Government National Mortgage Association
participation certificates 6
7
Postal Service7
8
Tennessee Valley Authority
9
United States Railway Association 7
22,419
1,113
8,574
575
22,760
983
8,671
581
23,488
968
8,711
588
23,366
807
8,107
568
24,170
796
8,806
562
24,274
787
8,783
559
24,415
777
8,781
552
24,341
767
8,886
551
24,153
759
8,881
547
4,120
2,998
4,935
104
3,743
2,431
6,015
336
3,141
2,364
7,460
356
3,099
2,202
8,155
428
3,039
2,202
8,335
430
3,004
2,202
8,495
444
3,004
2,202
8,655
444
3,004
1,837
8,850
446
3,004
1,837
8,670
455
10 Federally sponsored agencies1
11 Federal Home Loan Banks
12 Federal Home Loan Mortgage Corporation
13 Federal National Mortgage Association
14 Federal Land Banks
15 Federal Intermediate Credit Banks
16 Banks for Cooperatives
17 Farm Credit Banks 1
18 Student Loan Marketing Association 8
19 Other
81,429
16,811
1,690
30,565
17,127
10,494
4,330
410
2
89,712
18,345
1,686
31,890
19,118
11,174
4,434
2,548
515
2
113,575
27,563
2,262
41,080
20,360
11,469
4,843
5,081
915
2
123,063
28,577
2,323
44,639
18,389
5,958
1,483
20,597
1,095
2
125,442
28,758
2,522
45,775
18,389
5,122
785
22,949
1,140
2
128,379
29,600
2,522
46,341
17,075
4,269
785
26,606
1,180
1
129,373
29,994
2,720
46,108
17,075
3,427
785
28,033
1,230
1
130,412
30,303
2,622
46,378
17,075
2,676
785
29,297
1,275
1
134,147
31,874
2,621
46,861
16,006
2,676
584
32,189
1,335
1
28,711
38,580
51,298
58,186
60,816
61,798
62,880
64,211
65,583
5,208
2,748
410
3,110
104
5,834
2,181
515
4,190
336
6,898
2,114
915
5,635
356
7,131
1,952
1,095
6,430
428
7,846
1,952
1,140
6,610
430
7,846
1,952
1,180
6,770
444
7,846
1,952
1,230
6,930
444
7,953
1,587
1,275
7,125
446
7,953
1,587
1,335
6,945
455
10,750
1,415
4,966
16,095
2,647
6,782
23,825
4,604
6,951
28,050
5,253
7,847
29,200
5,497
8,141
29,765
5,639
8,202
30,445
5,754
8,279
31,080
5,926
8,819
31,670
6,157
9,481
MEMO:
20 Federal Financing Bank debt 7 9
21
22
23
24
25
Lending to federal and federally sponsored
agencies
Export-Import Bank 4
Postal Service7
Student Loan Marketing Association 8
Tennessee Valley Authority
United States Railway Association 7
Other Lending10
26 Farmers Home Administration
27 Rural Electrification Administration
28 Other
.'
1. In September 1977 the Farm Credit Banks issued their first consolidated
bonds, and in January 1979 they began issuing these bonds on a regular basis to
replace the financing activities of the Federal Land Banks, the Federal Intermediate Credit Banks, and the Banks for Cooperatives. Line 17 represents those
consolidated bonds outstanding, as well as any discount notes that have been
issued. Lines 1 and 10 reflect the addition of this item.
2. Consists of mortgages assumed by the Defense Department between 1957
and 1963 under family housing and homeowners assistance programs.
3. Includes participation certificates reclassified as debt beginning Oct. 1, 1976.
4. Off-budget Aug. 17, 1974, through Sept. 30, 1976; on-budget thereafter.
5. Consists of debentures issued in payment of Federal Housing Administration
insurance claims. Once issued, these securities may be sold privately on the securities market.
6. Certificates of participation issued prior to fiscal 1969 by the Government
National Mortgage Association acting as trustee for the Farmers Home Administration; Department of Health, Education, and Welfare; Department
of Housing and Urban Development; Small Business Administration; and the
Veterans Administration.
7. Off-budget.
8. Unlike other federally sponsored agencies, the Student Loan Marketing Association may borrow from the Federal Financing Bank (FFB) since its obligations
are guaranteed by the Department of Health, Education, and Welfare.
9. The FFB, which began operations in 1974, is authorized to purchase or sell
obligations issued, sold, or guaranteed by other federal agencies. Since 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.
10. Includes FFB purchases of agency assets and guaranteed loans; the latter
contain loans guaranteed by numerous agencies with the guarantees of any particular agency being generally small. The Farmers Home Administration item
consists exclusively of agency assets, while the Rural Electrification Administration
entry contains both agency assets and guaranteed loans.
A36
1.47
Domestic Financial Statistics • February 1980
NEW SECURITY ISSUES of State and Local Governments
Millions of dollars
Type of issue or issuer,
or use
1979
1976
1978
1977
June'
1 All issues, new and refunding 1
2
3
4
5
Type of issue
General obligation
Revenue
Housing Assisstance Administration 2
U.S. government loans
July'
Aug/
Sept/
Nov.
Oct/
35,313
46,769
48,607
4,736
3,399
4,261
2,479
4,235
4,105
18,040
17,140
18,042
28,655
17,854
30,658
1,543
3,174
789
2,607
743
3,508
699
1,773
1,044
3,179
804
3,289
133
72
95
19
3
10
7
12
12
Type of issuer
6 State
7 Special district and statutory authority
8 Municipalities, counties, townships, school districts
7,054
15,304
12,845
6,354
21,717
18,623
6,632
24,156
17,718
642
2,068
2,007
234
1,606
1,556
200
2,560
1,490
113
1,414
945
294
2,750
1,179
274
2,661
1,158
9 Issues for new capital, total
32,108
36,189
37,629
4,389
2,902
4,197
2,436
4,177
3,635
Use of proceeds
Education
Transportation
Utilities and conservation
Social welfare
Industrial aid
Other purposes
4,900
2,586
9,594
6,566
483
7,979
5,076
2,951
8,119
8,274
4,676
7,093
5,003
3,460
9,026
10,494
3,526
6,120
527
278
988
1,454
344
798
383
149
608
1,166
328
268
556
151
817
1,749
417
507
218
38
336
1,082
382
380
311
562
1,431
1,182
427
264
298
97
509
2,031
321
379
10
11
12
13
14
15
1. Par amounts of long-term issues based on date of sale.
2. Only bonds sold pursuant to the 1949 Housing Act, which are secured by
contract requiring the Housing Assistance Administration to make annual contributions to tne local authority.
1.48
SOURCE. Public Securities Association
NEW SECURITY ISSUES of Corporations
Millions of dollars
Type of issue or issuer,
or use
1979
1976
1978
1977
May
June
July'
Aug/
Sept.
Oct.
1 All issues1
53,488
53,792
47,230
4,167
6,247
4,095
4,083
4,308
4,561
2 Bonds
42,380
42,015
36,872
3,575
5,356
3,114
2,859
3,021
3,532
Type of offering
3 Public
4 Private placement
26,453
15,927
24,072
17,943
19,815
17,057
1,999
1,576
4,171
1,185
2,247
867
1,973
886
2,167
854
2,669
863
13,264
4,372
4,387
8,297
2,787
9,274
12,204
6,234
1,996
8,262
3,063
10,258
9,572
5,246
2,007
7,092
3,373
9,586
1,208
267
205
638
102
1,154
1,146
573
423
1,125
379
1,710
968
241
380
174
26
1,325
806
413
171
137
336
996
1,095
361
175
620
418
353
1,334
214
296
1,107
433
147
11,108
11,777
10,358
592
891
981
1,224
1,287
1,029
Type
12 Preferred
13 Common
2,803
8,305
3,916
7,861
2,832
7,526
174
418
278
613
392
589
401
823
698
589
195
834
Industry group
14 Manufacturing
15 Commercial and miscellaneous
Transportation
17 Public utility
18 Communication
.
19 Real estate and financial
2,237
1,183
24
6,121
776
771
1,189
1,834
456
5,865
1,379
1,049
1,241
1,816
263
5,140
264
1,631
85
203
49
227
7
21
47
363
3
248
30
200
38
173
360
266
142
366
394
218
4
527
83
61
151
98
5
6
7
8
9
10
Industry group
Manufacturing
Commercial and miscellaneous
Transportation
Public utility
Communication
Real estate and financial
11 Stocks
1. Figures, which represent gross proceeds of issues maturing in more than one
year, sold for cash in the United States, are principal amount or number of units
multiplied by offering price. Excludes offerings of less than $100,000, secondary
offerings, undefined or exempted issues as defined in the Securities Act of
598
68
103
91
662
47
70
1933, employee stock plans, investment companies other than closed-end, intracorporate transactions, and sales to foreigners.
SOURCE. Securities and Exchange Commission.
Corporate Finance
1.49
OPEN-END INVESTMENT COMPANIES
A37
Net Sales and Asset Position
Millions of dollars
1979
1979
1978
Item
June
Aug.
July
Sept.
Oct.
Nov.
Dec.
INVESTMENT COMPANIES 1
1 Sales of own shares 2
2 Redemptions of own shares 3
3 Net sales
4
5
6
6,645
7,231
-586
676
667
9
744
706
38
675
832
-157
580
784
-204
617
805
-188
44,980
4,507
40,473
Assets 4
Cash position5
Other
7,495
8,393
-898
49,493
4,983
44,510
48,064
5,012
43,052
48,771
5,052
43,719
50,802
4,924
45,878
50,147
5,016
45,131
46,271
4,521
41,750
48,613
4,984
43,629
748
743
5
49,493
4,983
44,510
5. Also includes all U.S. government securities and other short-term debt securities.
1. Excluding money market funds.
2. Includes reinvestment of investment income dividends. Excludes reinvestment of capital gains distributions and share issue of conversions from one fund
to another m the same group.
3. Excludes share redemption resulting from conversions from one fund to another in the same group.
4. Market value at end of period, less current liabilities.
1.50
690 r
579
111
NOTE. Investment Company Institute data based on reports of members, which
comprise substantially all open-end investment companies registered with the Securities and Exchange Commission. Data reflect newly formed companies after
their initial offering of securities.
CORPORATE PROFITS AND THEIR DISTRIBUTION
Billions of dollars; quarterly data are at seasonally adjusted annual rates.
1978
Account
1976
1977
Q1
1
Profits before tax
2 Profits tax liability
3 Profits after tax
4
Dividends
Undistributed profits
5
6 Capital consumption allowances
7 Net cash flow
Q2
Q3
Q4
Q1
Q2
Q3
156.0
177.1
206.0
177.5
207.2
212.0
227.4
233.3
227.9
242.3
63.8
92.2
37.5
54.7
97.1
151.8
72.6
104.5
42.1
62.4
109.3
171.7
84.5
121.5
47.2
74.3
119.8
194.1
70.8
106.7
45.1
61.6
116.5
178.1
84.7
122.4
46.0
76.4
119.1
195.5
87.5
124.5
47.8
76.8
120.6
197.3
95.1
132.3
49.7
82.6
123.1
205.7
91.3
142.0
51.5
90.5
125.5
216.0
88.7
139.3
52.3
87.0
130.4
217.3
94.0
148.3
52.8
95.5
132.8
228.3
SOURCE. Survey of Current Business (U.S. Department of Commerce.).
1979
1978
A38
1.51
DomesticNonfinancialStatistics • February 1980
NONFINANCIAL CORPORATIONS
Current Assets and Liabilities
Billions of dollars, except for ratio
1978
Account
1975
1976
1979
1977
Q1
Q2
Q3
04
Q1
Q2
Q3
1 Current assets
759.0
826.3
900.9
925.0
954.2
992.6
1,028.1
1,078.6
1,110.6
1,169.6
2
3
4
5
6
82.1
19.0
272.1
315.9
69.9
87.3
23.6
293.3
342.9
79.2
94.3
18.7
325.0
375.6
87.3
88.8
18.6
337.4
390.5
89.6
91.3
17.3
356.0
399.3
90.3
91.6
16.1
376.4
415.5
92.9
103.5
17.8
381.9
428.3
96.5
102.4
19.2
405.3
452.6
99.1
100.1
20.8
419.0
469.2
101.5
103.6
17.8
448.9
492.7
106.7
7 Current liabilities
451.6
492.7
546.8
574.2
593.5
626.3
662.2
701.9
723.9
773.7
8 Notes and accounts payable
9 Other
264.2
187.4
282.0
210.6
313.7
233.1
325.2
249.0
337.9
255.6
356.2
270.0
375.1
287.1
392.6
309.2
410.8
313.2
443.1
330.6
307.4
336.6
354.1
350.7
360.7
366.3
365.9
376.7
386.1
395.9
1.681
1.677
1.648
1.611
1.608
1.585
1.552
1.537
1.534
1.512
Cash
U.S. government securities
Notes and accounts receivable
Inventories
Other
10 Net working capital
11 MEMO: Current ratio
1
1. Ratio of total current assets to total current liabilities.
All data in this table reflect the most current benchmarks. Complete data are
available upon request from the Flow of Funds Section, Division of Research and
Statistics.
NOTE: For a description of this series, see "Working Capital of Nonfinancial
C o r p o r a t i o n s " in t h e J u l y 1978 BULLETIN, p p . 5 3 3 - 3 7 .
SOURCE. Federal Trade Commission.
1.52
BUSINESS EXPENDITURES on New Plant and Equipment
Billions of dollars; quarterly data are at seasonally adjusted annual rates.
1979
1978
Industry
1978
03
1 All industries
Manufacturing
2 Durable goods industries
3 Nondurable goods industries
Nonmanufacturing
4 Mining
Transportation
5 Railroad
Air
6
Other
7
Public utilities
8 Electric
9
Gas and other
10 Communication
11 Commercial and other 1
Q4
01
Q2
03'
Q42
Ql2
Q2 2
153.82
176.37
155.41
163.96
165.94
173.48
179.33
184.32
189.32
195.76
31.66
35.96
37.89
40.41
32.25
35.50
33.99
39.26
34.00
37.56
36.86
39.56
39.72
40.50
40.16
42.88
42.32
42.70
44.44
44.68
4.78
5.52
4.99
4.98
5.46
5.31
5.42
5.91
4.95
5.04
3.32
2.30
2.43
3.88
3.34
2.97
3.38
2.20
2.47
3.49
2.39
2.55
4.02
3.35
2.71
3.66
3.26
2.79
4.03
3.10
3.16
4.00
3.74
3.22
3.92
5.09
3.75
3.68
3.89
3.98
29.48
4.70
18.16
25.71
33.18
4.99
20.18
28.98
24.92
4.70
18.90
26,09
26.95
4.78
18.46
27.12
27.70
4.66
18.75
27.73
28.06
5.18
20.29
28.51
28.32
5.01
20.41
29.66
28.53
5.24
27.72
5.35
53 52
28.32
6.13
55 60
1. Includes trade, service, construction, finance, and insurance.
2. Anticipated by business.
NOTE. Estimates for corporate and noncorporate business, excluding
1980
1979p
50 65
agriculture; real estate operators; medical, legal, educational, and cultural service;
and noprofit organizations.
Source. Survey of Current Business (U.S. Dept. of Commerce).
Corporate Finance
1.53
DOMESTIC FINANCE COMPANIES
A39
Assets and Liabilities
Billions of dollars, end of period
1978
1973
Account
1974
1975
1976
1979
1977
Q3
04
Q1
Q2
Q3
ASSETS
Accounts receivable, gross
Consumer
Business
Total
LESS: Reserves for unearned income and losses ....
Accounts receivable, net
Cash and bank deposits
Securities
All other
35.4
32.3
67.7
8.4
59.3
2.6
.8
10.6
36.1
37.2
73.3
9.0
64.2
3.0
.4
12.0
36.0
39.3
75.3
9.4
65.9
2.9
1.0
11.8
38.6
44.7
83.4
10.5
72.9
2.6
1.1
12.6
44.0
55.2
99.2
12.7
86.5
2.6
.9
14.3
49.7
58.3
108.0
14.3
93.7
2.7
1.8
17.1
52.6
63.3
116.0
15.6
100.4
3.5
1.3
17.3
54.9
66.7
121.6
16.5
105.1
58.7
70.1
128.8
17.7
111.1
62.3
68.1
130.4
18.7
111.7
23.81
24.6
25.8
73.2
79.6
81.6
89.2
104.3
115.3
122.4
128.9
135.8
137.4
10 Bank loans
11 Commercial paper
7.2
19.7
9.7
20.7
8.0
22.2
6.3
23.7
5.9
29.6
5.4
29.3
6.5
34.5
6.5
38.1
7.3
41.0
7.8
39.2
12
13
14
4.6
24.6
5.6
4.9
26.5
5.5
4.5
27.6
6.8
5.4
32.3
8.1
6.2
36.0
11.5
6.8
41.3
15.2
8.1
43.6
12.6
6.7
44.5
15.1
8.8
46.0
14.4
9.1
47.5
15.4
1
2
3
4
5
6
7
8
9 Total assets
LIABILITIES
Short-term, n.e.c
Long-term n.e.c
Other
15 Capital, surplus, and undivided profits
11.5
12.4
12.5
13.4
15.1
17.3
17.2
18.0
18.2
18.4
16 Total liabilities and capital
73.2
79.6
81.6
89.2
104.3
115.3
122.4
128.9
135.8
137.4
1. Beginning Q1 1979, asset items on lines 6, 7, and 8 are combined.
NOTE. Components may not add to totals due to rounding.
1.54
DOMESTIC FINANCE COMPANIES
Business Credit
Millions of dollars, seasonally adjusted except as noted
Type
Accounts
receivable
outstanding
Nov. 30,
1979'
Changes in accounts
receivable
Extensions
Repayments
1979
1979
1979
Sept.
Nov.
Oct.
Sept.
Oct.
Nov.
Sept.
Oct.
Nov.
1 Total
70,225
-1,245
399
242
15,310
16,354
16,505
16,555
15,955
16,263
2 Retail automotive (commercial vehicles
3 Wholesale automotive
4 Retail paper on business, industrial and
farm equipment
5 Loans on commercial accounts receivable 2 ....
6 Factored commercial accounts receivable 2
7 All other business credit
15,308
14,075
94
-1,453
-16
-408
-41
-319
1,236
5,320
1,151
6,079
1,135
5,082
1,142
6,773
1,167
6,487
1,176
5,401
18,516
6,714
15,612
135
-281
260
369
168
286
261
304
37
1,172
5,369
2,213
1,300
5,200
2,624
1,252
6,635
2,401
1,037
5,650
1,953
931
5,032
2,338
991
6,331
2,364
1. Not seasonally adjusted.
2. Beginning January 1979 the categories "Loans on commercial accounts receivable" and "Factored commercial accounts receivable" are combined.
A40
1.55
DomesticNonfinancialStatistics • February 1980
MORTGAGE MARKETS
Millions of dollars; exceptions noted.
1979
Item
1976
1977
1978
Aug.
July
Sept.
Nov.
Oct.
Dec.
Terms and yields in primary and secondary markets
PRIMARY MARKETS
1
2
3
4
5
6
Conventional mortgages on new homes
Terms1
Purchase price (thousands of dollars)
Amount of loan (thousands of dollars)
Loan/price ratio (percent)
Maturity (years)
Fees and charges (percent of loan amount) 2
Contract rate (percent per annum)
Yield (percent per annum)
1 FHLBB series3
8 HUD series4
48.4
35.9
74.2
27.2
1.44
8.76
54.3
40.5
76.3
27.9
1.33
8.80
62.6
45.9
75.3
28.0
1.39
9.30
74.3
52.7
73.0
28.1
1.63
10.49
80.0
56.9
73.1
28.1
1.60
10.73
75.5
53.9
73.4
28.6
1.67
10.72
76.4
54.9
73.7
28.5
1.70
10.91
771
54.5'
73.8
28.5
1.82
11.04
79.2
55.8
72.8
28.7
1.86
11.31
8.99
8.99
9.01
8.95
9.54
9.68
10.78
10.95
11.01
11.10
11.02
11.35
11.21
12.15
11.37
12.50
11.65
12.50
8.82
8.17
8.68
8.04
9.70
8.98
10.46
9.77
10.58
9.91
11.37
10.31
n.a.
11.25
12.41
11.57
12.24
11.34
8.99
9.11
8.73
8.98
9.77
10.01
10.66
11.52
10.66
11.52
11.08
11.75
12.52
12.85
12.75
13.66
12.48
12.98
50,350 c
n.a.
n.a.
15,797
51,091
n.a.
n.a.
16,106
SECONDARY MARKETS
9
10
11
12
Yield (percent per annum)
FHA mortgages (HUD series) 5
GNMA securities6
FNMA auctions 7
Government-underwritten loans
Conventional loans
Activity in secondary markets
FEDERAL NATIONAL MORTGAGE ASSOCIATION
Mortgage holdings (end of period)
Total
FHA-insured
VA-guaranteed
Conventional
32,904
18,916
9,212
4,776
34,370
18,457
9,315
6,597
43,311
21,243
10,544
11,524
48,539
23,378
10,450
14,710
48,909
23,526
10,386
14,997
49,173
n.a.
n.a.
15,203
49,744
n.a.
n.a.
15,517
Mortgage transactions (during period)
17 Purchases
18 Sales
3,606
86
4,780
67
12,303
5
602
0
646
0
545
0
859
0
872
0
Mortgage commitments8
19 Contracted (during period)
20 Outstanding (end of period)
6,247
3,398
9,729
4,698
18,960
9,201
354
5,912
593
5,692
1,407
6,352
2,369
7,472
496
6,974
4,929.8
2,787.2
7,974.1
4,846.2
12,978
6,747.2
133.2
69.6
162.3
82.7
1,421.1
599.9
2,943.4
1,130.4
558.4
264.6
649.2
249.3
2,595.7
1,879.2
5.675.2
3,917.8
9,933.0
5,110.9
93.5
69.9
245.9
184.1
527.3
325.6
1,049.9
431.2
366.1
190.2
413.2
152.4
Mortgage holdings (end of period)m
25 Total
26 FHA/VA
27 Conventional
4,269
1,618
2,651
3,276
1,395
1,881
3,064
1,243
1,822
3,487
1,156
2,331
3,549
1,145
2,404
3,729
1,132
2,597
3,726
1,120
2,606
3,990
1,112
2,879
4,035
1,102
2,933
Mortgage transactions (during period)
28 Purchases
29 Sales
1,175
1,396
3,900
4,131
6,524
6,211
518
321
636
554
537
347
552
530
458
186
403
361
Mortgage commitments11
30 Contracted (during period)
31 Outstanding (end of period)
1,477
333
5,546
1,063
7,451
1,410
528
1,572
655
1,536
437
1,400
504
1,312
221
1,036
199
797
13
14
15
16
Auction of 4-month commitments to buy
Government-underwritten loans
Offered 9
Accepted
Conventional loans
23 Offered 9
24
Accepted
21
22
893
0
n.a.
n.a.
FEDERAL H O M E LOAN MORTGAGE CORPORATION
1. Weighted averages based on sample surveys of mortgages originated by major
institutional lender groups. Compiled by the Federal Home Loan Bank Board in
cooperation with the Federal Deposit Insurance Corporation.
2. Includes all fees, commissions, discounts, and "points" paid (by the borrower
or the seller) in order to obtain a loan.
3. Average effective interest rates on loans closed, assuming prepayment at the
end of 10 years.
4. Average contract rates on new commitments for conventional first mortgages,
rounded to the nearest 5 basis points; from Department of Housing and Urban
Development.
5. Average gross yields on 30-year, minimum-downpayment, Federal Housing
Administration insured first mortgages for immediate delivery in the private secondary market. Any gaps in data are due to periods of adjustment to changes in
maximum permissible contract rates.
6. Average net yields to investors on Government National Mortgage Association g u a r a n t e e d , m o r t g a g e - b a c k e d , fully modified pass-through
securities, assuming prepayment in 12 years on pools of 30-year FHA/VA mortgages carrying the prevailing ceiling rate. Monthly figures are unweighted averages
of Monday quotations for the month.
7. Average gross yields (before deduction of 38 basis points for mortgage
servicing) on accepted bids in Federal National Mortgage Association's auctions
of 4-month commitments to purchase home mortgages, assuming prepayment in
12 years for 30-year mortgages. No adjustments are made for FNMA commitment
fees or stock related requirements. Monthly figures are unweighted averages for
auctions conducted within the month.
8. Includes some multifamily and nonprofit hospital loan commitments in addition to 1- to 4-family loan commitments accepted in FNMA's free market auction
system, and through the FNMA-GNMA tandem plans.
9. Mortgage amounts offered by bidders are total bids received.
10. Includes participation as well as whole loans.
11. Includes conventional and government-underwritten loans.
Real Estate Debt
1.56
A41
MORTGAGE DEBT OUTSTANDING
Millions of dollars, end of period
1979
1978
Type of holder, and type of property
1976
1977
1978
Q3
04
02
01
03
1 All holders
889,327
1,023,505
1,172,502
1,133,503
1,172,737
1,206,280
1,252,519
1,295,449
2
3
4
5
556,557
104,516
171,223
57,031
656,566
111,841
189,274
65,824
761,905
122,004
212,597
75,996
734,709
119,381
205,629
73,784
761,892
121,978
212,743
76,124
784,602
123,970
217,501
80,207
817,018
125,923
224,507
85,071
845,284'
129,079
232,084
89,002
647,650
151,326
86,234
8,082
50,289
6,721
745,011
178,979
105,115
9,215
56,898
7,751
847,910
213,963
126,966
10,912
67,056
9,029
821,988
205,445
121,911
10,478
64,386
8,670
848,145
213,963
126,966
10,912
67,056
9,029
866,036
220,063
130,585
11,223
68,968
9,287
894,471
229,564
136,223
11,708
71,945
9,688
919,984
239,363
142,038
12,208
75,016
10,101
81,639
53,089
14,177
14,313
60
88,104
57,637
15,304
15,110
53
95,157
62,252
16,529
16,319
57
93,403
61,104
16,224
16,019
56
95,157
62,252
16,529
16,319
57
96,136
62,892
16,699
16,488
57
97,155
63,559
16,876
16,663
58
97,929
64,065
17,010
16,795
59
323,130
260,895
28,436
33,799
381,163
310,686
32,513
37,964
432,858
356,156
36,057
40,645
420,971
345,617
35,362
39,992
432,858
356,156
36,057
40,645
441,420
363,774
36,682
40,964
456,629
377,587
37,078
41,964
468,324
387,257
38,028
43,039
91,555
16,088
19,178
48,864
7,425
96,765
14,727
18,807
54,388
8,843
105,932
14,449
19,026
62,086
10,371
102,169
14,158
18,742
59,153
10,116
106,167
14,436
19,000
62,232
10,499
108,417
14,507
19,080
63,908
10,922
111,123
14,489
19,102
66,055
11,477
114,368
14,884
19,107
68,513
11,864
66,753
4,241
1,970
2,271
70,006
3,660
1,548
2,112
81,853
3,509
877
2,632
78,672
3,560
897
2,663
81,853
3,509
877
2,632
86,689
3,448
821
2,627
90,095
3.425
800
2,625
93,143
3,382
780
2,602
1- to 4-family
Multifamily
Commercial
Farm
6 Maior financial institutions
7 Commercial banks 1
8
1- to 4-family
9
Multifamily
10
Commercial
Farm
11
12
13
14
15
16
Mutual savings banks
1- to 4-family
Multifamily
Commercial
Farm
17
18
19
20
Savings and loan associations
1- to 4-family
Multifamily
Commmercial
21
?,?
73
7,4
25
Life insurance companies
1- to 4-family
Multifamily
Commercial
Farm
26 Federal and related agencies
27 Government National Mortgage Assn
1- to 4-family
28
Multifamily
29
30
31
32
33
34
Farmers Home Administration
1- to 4-family
Multifamily
Commercial
Farm
1,964
454
218
72
320
1,353
626
275
149
303
926
288
320
101
217
1,384
460
240
251
433
926
288
320
101
217
956
302
180
283
191
1,200
363
75
278
484
1,383
163
299
262
659
35
36
37
Federal Housing and Veterans Admin
1- to 4-family
Multifamily
5,150
1,676
3,474
5,212
1,627
3,585
5,419
1,641
3,778
5,295
1,565
3,730
5,419
1,641
3,778
5,522
1,693
3,829
5,597
1,744
3,853
5,672
1,795
3,877
38
39
40
Federal National Mortgage Association
1- to 4-family
Multifamily
32,904
26,934
5,970
34,369
28,504
5,865
43,311
37,579
5,732
41,189
35,437
5,752
43,311
37,579
5,732
46,410
40,702
5,708
48,206
42,543
5,663
49,173
43,534
5,639
41
42
43
Federal Land Banks
1- to 4-family
Farm
19,125
601
18,524
22,136
670
21,466
25,624
927
24,697
24,758
819
23,939
25,624
927
24,697
26,893
1,042
25,851
28,459
1,198
27,261
29,804
1,374
28,430
44
45
46
Federal Home Loan Mortgage Corp
1- to 4-family
Mutlifamily
4,269
3,889
380
3,2767
2,738
538
3,064
2,407
657
2,486
1,994
492
3,064
2,407
657
3,460
2,685
775
3,208
2,489
719
3,729
2,850
879
49,801
30,572
29,583
989
70,289
44,896
43,555
1,341
88,633
24,347
52,732
1,615
82,730
50,844
49,276
1,568
88,633
54,347
52,732
1,615
94,551
57,955
56,269
1,686
102,259
63,000
61,246
1,754
110,648
69,357
67,535
1,822
2,671
2,282
389
6,610
5,621
989
11,892
9,657
2,235
10,511
8,616
1,895
11,892
9,657
2,235
12,467
10,088
2,379
13,708
11,096
2,612
14,421
11,568
2,853
16,558
10,219
532
2,440
3,367
18,783
11,379
759
2,945
3,682
22,394
13,400
1,116
3,560
4,318
21,375
12,851
1,116
3,369
4,039
22,394
13,400
1,116
3,560
4,318
24,129
13,883
1,465
3,660
5,121
25,551
14,329
1,764
3,833
5,625
26,870
14,972
1,763
4,054
6,081
125,123
62,643
20,420
21,446
20,614
138,199
72,115
20,538
21,820
23,726
154,106
82,574
21,395
212,830
27,307
150,113
80,004
21,119
22,459
26,531
154,106
82,574
21,395
22,830
27,307
158,014
85,056
21,670
23,292
27,996
165,694
89,352
22,094
23,770
30,478
171,674
92,469
22,992
24,405
31,808
47 Mortgage pools or trusts 2
48 Government National Mortgage Assn
1- to 4-family
49
Multifamily
50
51
52
53
Federal Home Loan Mortgage Corp
1- to 4-family
Multifamily
54
55
56
57
58
Farmers Home Administration
1- to 4-family
Multifamily
Commercial
Farm
59 Individual and others 3
60
61
62 Commerical
63 Farm
1. Includes loans held by nondeposit trust companies but not bank trust departments.
2. Outstanding principal balances of mortgages backing securities insured or
guaranteed by the agency indicated.
3. 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 U.S. agencies for which amounts are small or separate
data are not readily available.
NOTE. Based on data from various institutional and government sources, with
some quarters estimated in part by the Federal Reserve in conjunction with the
Federal Home Loan Bank Board and the Department of Commerce. 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. Multifamily debt refers to loans on structures of five or more units.
A42
1.57
DomesticNonfinancialStatistics • February 1980
CONSUMER INSTALLMENT CREDIT'
Total Outstanding, and Net Change
Millions of dollars
Holder, and type of credit
1979
1976
1977
1978
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
Amounts outstanding (end of period)
1 Total
193,977
230,829
275,629
291,856
295,052
299,813
303,902
305,217
307,641
311,339
By major holder
Commercial banks
Finance companies
Credit unions
Retailers 2
Savings and loans
Gasoline companies ....
Mutual savings banks ..
93,728
38,919
31,169
19,260
6,246
2,830
1,825
112,373
44,868
37,605
23,490
7,354
2,963
2,176
136,189
54,298
45,939
24,876
8,394
3,240
2,693
144,035
60,996
47,478
23,672
9,290
3,704
2,681
145,169
62,463
47,772
23,713
9,425
3,872
2,638
147,312
63,362
48,631
24,114
9,760
4,048
2,586
148,657
64,822
49,214
24,446
9,972
4,244
2,547
149,152
65,692
48,770
24,860
10,073
4,174
2,496
149,057
67,164
48,673
25,732
10,241
4,281
2,493
149,821
68,318
48,186
27,916
10,361
4,316
2,421
By major type of credit
9 Automobile
10 Commercial banks ...
11
Indirect paper
12
Direct loans
13 Credit unions
14 Finance companies ...
67,707
39,621
22,072
17,549
15,238
12,848
82,911
49,577
27,379
22,198
18,099
15,235
102,468
60,564
33,850
26,714
21,967
19,937
110,930
64,480
36,251
28,229
22,703
23,747
111,952
64,826
36,475
28,351
22,844
24,282
113,351
65,389
36,887
28,502
23,255
24,707
114,765
65,813
37,267
28,546
23,534
25,418
114,876
65,973
37,469
28,504
23,322
25,581
115,121
65,646
37,334
28,312
23,275
26,200
115,022
65,229
37,209
28,020
23,042
26,751
15 Revolving
16 Commercial banks ...
17 Retailer
18 Gasoline companies .
17,189
14,359
2,830
39,274
18,374
17,937
2,963
47,051
24,434
19,377
3,240
47,458
25,652
18,102
3,704
47,894
25,927
18,095
3,872
49,270
26,782
18,440
4,048
50,422
27,446
18,732
4,244
50,883
27,600
19,109
4,174
52,060
27,827
19,952
4,281
55,547
29,171
22,060
4,316
19 Mobile home
20
Commercial banks ...
21 Finance companies ...
22
Savings and loans ....
23 Credit unions
14,573
8,737
3,263
2,241
332
15,141
9,124
3,077
2,538
402
16,042
9,553
3,152
2,848
489
16,607
9,759
3,191
3,152
505
16,719
9,801
3,212
3,198
508
16,972
9,912
3,231
3,312
517
17,105
9,940
3,258
3,384
523
17,244
10,013
3,295
3,418
518
17,349
10,036
3,321
3,475
517
17,409
9,991
3,390
3,516
512
24 Other
25
Commercial banks ...
26
Finance companies ...
27 Credit unions
28
Retailers
29
Savings and loans ....
30
Mutual savings banks
94,508
31,011
22,808
15,599
19,260
4,,005
1,825
93,503
35,298
26,556
19,104
5,553
4,816
2,176
110,068
41,638
31,209
23,483
5,499
5,546
2,693
116,861
44,144
34,058
24,270
5,570
6,138
2,681
118,487
44,615
34,969
24,420
5,618
6,227
2,638
120,220
45,229
35,424
24,859
5,674
6,448
2,586
121,610
45.458
36,146
25,157
5,714
6,588
2,547
122,214
45,566
36,816
24,930
5,751
6,655
2,496
123,111
45,548
37,643
24,881
5,780
6,766
2,493
123,361
45,430
38,177
24,632
5,856
6,845
2,421
2
3
4
5
6
7
8
Net change (during period) 3
31 Total
21,647
35,278
44,810
2,558
2,443
2,446
4,446
2,186
2,407
1,550
By major holder
Commercial banks
Finance companies
Credit unions
Retailers 1
Savings and loans
Gasoline companies ....
Mutual savings banks ..
10,792
2,946
5,503
1,059
1,085
124
138
18,645
5,948
6,436
2,654
1,111
132
352
23,813
9,430
8,334
1,386
1,041
276
530
984
913
144
288
240
39
-50
662
1,185
342
180
120
2
-48
866
549
391
332
253
116
-61
1,521
1,773
411
443
207
127
-36
771
1,076
-152
335
76
122
-42
283
1,340
-44
477
143
218
-10
419
1,087
-455
282
165
115
-63
By major type of credit
39 Automobile
40
Commercial banks ...
41
Indirect paper
42
Direct loans
43
Credit unions
44
Finance companies ...
10,465
6,334
2,742
3,592
2,497
1,634
15,204
9,956
5,307
4,649
2,861
2,387
19,557
10,987
6,471
4,516
3,868
4,702
690
123
87
36
45
522
616
72
51
21
183
361
594
172
188
-16
177
245
1,823
762
542
220
218
843
487
203
237
-34
-79
363
533
-76
40
-116
-24
633
682
122
260
-138
-213
773
45 Revolving
46
Commercial banks ...
47
Retailers
48
Gasoline companies .
2,170
2,046
124
6,248
4,015
2,101
132
7,776
6,060
1,440
276
796
494
263
39
429
303
124
2
787
365
306
116
1,057
546
384
127
664
253
289
122
799
136
445
218
633
225
293
115
49 Mobile home
50
Commercial banks ...
51 Finance companies ...
52
Savings and loans ....
53 Credit unions
140
70
-182
192
60
565
387
-189
297
70
897
426
74
310
87
102
12
14
74
2
72
17
11
41
3
182
59
13
106
4
89
10
17
57
5
150
105
27
21
-3
103
33
19
52
-1
108
-22
84
51
-5
54 Other
55
Commercial banks ...
56 Finance companies ...
57
Credit unions
58
Retailers
59
Savings and loans ....
60 Mutual savings banks
8,872
2,342
1,494
2,946
1,059
893
138
13,261
4,287
3,750
3,505
553
814
352
16,580
6,340
4,654
4,379
-54
731
530
970
355
377
97
25
166
-50
1,326
270
813
156
56
79
-48
883
270
291
210
26
147
-61
1,477
203
913
188
59
150
-36
885
210
686
-70
46
55
-42
972
190
688
-19
32
91
-10
127
94
230
-237
-11
114
-63
32
33
34
35
36
37
38
1. The Board's series cover most short- and intermediate-term credit extended
to individuals through regular business channels, usually to finance the purchase
of consumer goods and services or to refinance debts incurred for such purposes,
and scheduled to be repaid (or with the option of repayment) in two or more
installments.
2. Includes auto dealers and excludes 30-day charge credit held by travel and
entertainment companies.
3. Net change equals extensions minus liquidations (repayments, charge-offs,
and other credit); figures for all months are seasonally adjusted.
NOTE. Total consumer noninstallment credit outstanding—credit scheduled to
be repaid in a lump sum, including single-payment loans, charge accounts, and
service credit—amounted to $64.3 billion at the end of 1978, $58.6 billion at the
end of 1977, $54.8 billion at the end of 1976, and $50.9 billion at the end of 1975.
Comparable data for Dec. 31, 1979, will be published in the February 1980 BULLETIN.
Consumer Debt
1.58
CONSUMER INSTALLMENT CREDIT
A43
Extensions and Liquidations
Millions of dollars
1979
Holder, and type of credit
1976
1977
1978
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
Extensions1
1 Total
2
3
4
5
6
7
8
By major holder
Commercial banks
Finance companies
Credit unions
Retailers 2
Savings and loans
Gasoline companies
Mutual savings banks
By major type of credit
9 Automobile
10 Commercial banks
11
Indirect paper
12
Direct loans
13 Credit unions
14 Finance companies
15 Revolving
16 Commercial banks
17 Retailers
18 Gasoline companies
19 Mobile home
20
Commercial banks
21 Finance companies
22
Savings and loans
23 Credit unions
24 Other
25 Commercial banks
26
Finance companies
27
Credit unions
28
Retailers
29
Savings and loans
30
Mutual savings banks
211,028
254,071
298,351
26,139
26,848
27,583
28,634
27,695
26,464
25,805
97,397
36,129
29,259
29,447
3,898
13,387
1,511
117,896
41,989
34,028
39,133
4,485
14,617
1,923
142,720
50,505
40,023
41,619
5,050
16,125
2,309
12,278
4,641
2,986
3,853
682
1,589
110
12,292
5,353
3,282
3,687
592
1,525
117
12,700
5,133
3,361
3,921
728
1,640
100
13,172
5,489
3,363
4,082
678
1,734
116
12,718
5,642
2,942
3,930
571
1,773
119
11,738
5,105
2,808
4,161
606
1,913
133
11,504
5,249
2,396
4,054
632
1,895
75
63,743
37,886
20,576
17,310
14,688
11,169
75,641
46,363
25,149
21,214
16,616
12,662
88,987
53,028
29,336
23,692
19,486
16,473
7,178
3,952
2,146
1,806
1,485
1,741
7,447
3,936
2,151
1,785
1,611
1,900
7,667
4,085
2,276
1,809
1,661
1,921
8,430
4,544
2,569
1,975
1,655
2,231
7,676
4,185
2,376
1,809
1,434
2,057
7,066
3,640
2,009
1,631
1,399
2,027
7,131
3,808
2,181
1,627
1,223
2,100
43,934
30,547
13,387
86,756
38,256
33,883
14,617
104,587
51,531
36,931
16,125
10,136
5,166
3,381
1,589
9,856
5,078
3,253
1,525
10,371
5,280
3,451
1,640
10,699
5,398
3 567
1>34
10,424
5,165
3 486
1J73
10,613
5,014
3,686
L913
10,330
4,817
3 618
L895
4,859
3,064
702
929
164
5,425
3,466
643
1,120
196
6,067
3,704
886
1,239
238
547
304
59
167
17
519
297
71
133
18
655
362
67
206
20
531
294
69
148
20
582
374
83
114
11
515
294
69
139
13
490
245
97
140
8
98,492
25,900
24,258
14,407
29,447
2,969
1,511
86,249
29,811
28,684
17,216
5,250
3,365
1,923
98,710
34,457
33,146
20,299
4,688
3,811
2,309
8,278
2,856
2,841
1,484
472
515
110
9,026
2,981
3,382
1,653
434
459
117
8,890
2,973
3,145
1,680
470
522
100
8,974
2,936
3,189
1,688
515
530
116
9,013
2,994
3,502
1,497
444
457
119
8,270
2,790
3,009
1,396
475
467
133
7,854
2,634
3,052
1,165
436
492
75
Liquidations1
189,381
218,793
253,541
23,581
24,405
25,137
24,188
25,509
24,057
24,255
86,605
33,183
23,756
28,388
2,813
13,263
1,373
99,251
36,041
27,592
36,479
3,374
14,485
1,571
118,907
41,075
31,689
40,233
4,009
15,849
1,779
11,294
3,728
2,842
3,565
442
1,550
160
11,630
4,168
2,940
3,507
472
1,523
165
11,834
4,584
2,970
3,589
475
1,524
161
11,651
3,716
2,952
3,639
471
1,607
152
11,947
4,566
3,094
3,595
495
1.651
161
11,455
3,765
2,852
3,684
463
1,695
143
11,085
4,162
2,851
3,772
467
1,780
138
53,278
31,552
17,834
13,718
12,191
9,535
60,437
36,407
19,842
16,565
13,755
10,275
69,430
42,041
22,865
19,176
15,618
11,771
6,488
3,829
2,059
1,770
1,440
1,219
6,831
3,864
2,100
1,764
1,428
1,539
7,073
3,913
2,088
1,825
1,484
1,676
6,607
3,782
2,027
1,755
1,437
1,388
7,189
3.982
2.139
1,843
1,513
1,694
6,533
3,716
1,969
1,747
1,423
1,394
6,449
3,686
1,921
1,765
1,436
1,327
45 Revolving
46 Commercial banks
47
Retailers
48
Gasoline companies
41,764
28,501
13,263
80,508
34,241
31,782
14,485
96,811
45,471
35,491
15,849
9,340
4,672
3,118
1,550
9,427
4,775
3 129
L523
9,584
4,915
3,145
L524
9,642
4,852
3,183
L607
9,760
4,912
3,197
L651
9,814
4,878
3 241
L695
9,697
4,592
3,325
1J80
49 Mobile home
50
Commercial banks
51
Finance companies
52
Savings and loans
53 Credit unions
4,719
2,994
884
737
104
4,860
3,079
832
823
126
5,170
3,278
812
929
151
445
292
45
93
15
447
280
60
92
15
473
303
54
100
16
442
284
52
91
15
432
269
56
93
14
412
261
50
87
14
382
267
13
89
13
89,620
23,558
22,764
11,461
28,388
2,076
1,373
72,988
25,524
24,934
13,711
4,697
2,551
1,571
82,130
28,117
28,492
15,920
4,742
3,080
1,779
7,308
2,501
2,464
1,387
447
349
160
7,700
2,711
2,569
1,497
378
380
165
8,007
2,703
2,854
1,470
444
375
161
7,497
2,733
2,276
1,500
456
380
152
8,128
2,784
2,816
1,567
398
402
161
7,298
2,600
2,321
1,415
443
376
143
7,727
2,540
2,822
1,402
447
378
138
31 Total
32
33
34
35
36
37
38
By major holder
Commercial banks
Finance companies
Credit unions
Retailers 2
Savings and loans
Gasoline companies
Mutual savings banks
By major type of credit
39 Automobile
40
Commercial banks
41
Indirect banks
42
Direct loans
43
Credit unions
44
Finance companies
54 Other
55 Commercial banks
56
Finance companies
57 Credit unions
58 Retailers
59 Savings and loans
60
Mutual savings banks
1. Monthly figures are seasonally adjusted.
2. Includes auto dealers and excludes 30-day charge credit held by travel and
entertainment companies.
A44
1.59
DomesticNonfinancialStatistics • February 1980
F U N D S R A I S E D IN U.S. C R E D I T M A R K E T S
Billions of dollars; quarterly data are at seasonally adjusted annual rates.
1976
Transaction category, sector
1973
1974
1975
1976
1977
1977
1978
1979
1978
H2
HI
H2
HI
H2
HI
Nonfinancial sectors
1 Total funds raised
2 Excluding equities
By sector and instrument
3 U.S. government
4
Treasury securities
5
Agency issues and mortgages
6 All other nonfinancial sectors
7
Corporate equities
8
Debt instruments
9
Private domestic nonfinancial sectors
10
Corporate equities
11
Debt instruments
12
Debt capital instruments
13
State and local obligations ....
14
Corporate bonds
Mortgages
15
Home
16
Multifamily residential
17
Commercial
18
Farm
19
Other debt instruments
20
Consumer credit
21
Bank loans n.e.c
22
Open market paper
23
Other
24
25
26
27
28
29
30
31
32
33
34
35
36
By borrowing sector
State and local governments ....
Households
Farm
Nonfarm noncorporate
Corporate
Foreign
Corporate equities
Debt instruments
Bonds
Bank loans n.e.c
Open market paper
U.S. government loans
203.1
195.4
191.3
187.4
210.8
200.7
271.9
261.1
338.5
335.4
400.3
398.2
274.9
266.8
298.1
296.9
378.9
373.8
384.5
387.1
416.1
409.3
386.5
383.8
8.3
7.9
.4
194.9
7.7
187.2
188.8
7.9
180.9
105.1
14.7
9.2
11.8
12.0
-.2
179.5
3.8
175.6
164.1
4.1
160.0
98.0
16.5
19.7
85.4
85.8
-.4
125.4
10.1
115.3
112.1
9.9
102.1
98.4
16.1
27.2
69.0
69.1
-.1
202.9
10.8
192.0
182.0
10.5
171.5
123.5
15.7
22.8
56.8
57.6
-.9
281.8
3.1
278.6
267.9
2.7
265.1
175.6
23.7
21.0
53.7
55.1
-1.4
346.6
2.1
344.5
314.4
2.6
311.8
196.6
28.3
20.1
61.4
61.8
-.3
213.4
8.1
205.4
192.3
7.7
184.6
126.5
10.9
22.9
46.1
46.7
-.6
252.0
1.2
250.8
241.5
.5
241.0
158.7
22.3
16.6
67.4
68.6
-1.2
311.5
5.1
306.4
294.2
4.9
289.3
192.5
25.0
25.4
61.4
62.3
-.9
323.1
-2.6
325.7
302.5
-1.8
304.3
188.0
27.8
20.6
46.0
47.9
-1.9
370.2
6.8
363.4
326.3
7.0
319.2
205.1
28.7
19.6
27.1
29.4
-2.3
359.4
2.7
356.7
344.1
2.8
341.3
204.8
17.5
23.7
46.4
10.4
18.9
5.5
75.8
26.0
37.1
2.5
10.3
34.8
6.9
15.1
5.0
62.0
9.9
31.7
6.6
13.7
39.5
4.6
3.8
9.7
-12.3
-2.6
9.0
63.7
1.8
13.4
6.1
48.0
25.6
4.0
4.0
14.4
96.4
7.4
18.4
8.8
89.5
40.6
27.0
2.9
19.0
104.5
10.2
23.3
10.2
115.2
50.6
37.3
5.2
22.2
70.0
3.1
12.5
7.3
58.0
27.6
10.8
2.3
17.4
89.7
6.4
14.8
9.0
82.3
36.6
27.3
3.4
14.9
103.1
8.4
21.9
8.7
96.7
44.5
26.7
2.4
23.2
99.8
9.3
21.2
9.3
116.3
50.1
43.1
5.3
17.8
109.2
11.2
25.4
11.1
114.1
51.0
31.4
5.1
26.5
112.7
8.2
25.8
17.1
136.5
47.7
48.9
10.8
29.1
188.8
13.2
80.1
9.6
13.0
73.0
164.1
15.5
51.2
8.0
7.7
81.7
112.1
13.7
49.5
8.8
2.0
38.1
182.0
15.2
90.7
10.9
5.4
59.8
267.9
20.4
139.9
14.7
12.5
80.3
314.4
23.6
162.6
18.1
15.7
94.5
192.3
11.7
98.8
11.9
5.8
64.1
241.5
15.7
129.4
15.7
13.4
67.3
294.2
25.0
150.4
13.8
12.5
92.4
302.5
21.0
156.1
15.3
16.3
93.7
326.3
26.1
169.1
20.8
14.5
95.8
344.1
14.6
168.5
23.2
15.1
122.7
6.1
-.2
6.3
1.0
2.7
.9
1.7
15.4
-.2
15.7
2.1
4.7
7.3
1.6
13.3
.2
13.2
6.2
3.9
.3
2.8
20.8
.3
20.5
8.6
6.8
1.9
3.3
13.9
.4
13.5
5.1
3.1
2.4
3.0
32.3
-.5
32.8
4.0
18.3
6.6
3.9
21.1
.3
20.8
9.7
5.1
2.4
3.6
10.5
.6
9.9
4.4
-.4
2.7
3.1
17.3
.2
17.1
5.7
6.5
2.2
2.9
20.6
-.8
21.4
5.0
9.3
3.6
3.6
43.9
-.2
44.1
3.0
27.3
9.6
4.2
15.3
*
11.0
15^4
3.5
2.8
6.1
3.1
Financial sectors
37 Total funds raised
44.8
39.2
12.7
24.1
54.0
81.4
28.5
47.7
60.3
80.7
82.1
90.9
By instrument
U.S. government related
Sponsored credit agency securities
Mortgage pool securities
Loans from U.S. government
Private financial sectors
Corporate equities
Debt instruments
Corporate bonds
Mortgages
Bank loans n.e.c
Open marketpaper and RPs ....
Loans from FHLBs
19.9
16.3
3.6
0
24.9
1.5
23.4
3.5
-1.2
9.0
4.9
7.2
23.1
16.6
5.8
.7
16.2
.3
15.9
2.1
-1.3
4.6
3.8
6.7
13.5
2.3
10.3
.9
-.8
.6
-1.4
2.9
2.3
-3.7
1.1
-4.0
18.6
3.3
15.7
-.4
5.5
1.0
4.4
5.8
2.1
-3.7
2.2
-2.0
26.3
7.0
20.5
-1.2
27.7
.9
26.9
10.1
3.1
-.3
9.6
4.3
U.4
23.1
18.3
0
40.0
1.7
38.3
7.5
.9
2.8
14.6
12.5
20.7
4.3
17.2
-.7
7.8
2.3
5.6
5.1
2.8
-5.3
5.0
-2.0
22.6
7.1
17.9
-2.3
25.1
.9
24.2
10.2
3.1
-1.8
9.8
2.9
29.9
6.8
23.1
0
30.4
.8
29.6
10.1
3.0
1.2
9.5
5.8
38.5
21.9
16.6
0
42.2
2.2
40.0
8.5
2.1
2.5
13.5
13.2
44.3
24.3
20.1
0
37.8
1.1
36.7
6.4
-.3
3.1
15.7
11.8
48.0
21.4
26.6
0
42.9
2.3
40.5
10.1
-.4
-1.4
24.5
7.7
By sector
50 Sponsored credit agencies
51 Mortgage pools
52 Private financial sectors
53 Commercial banks
54 Bank affiliates
55
Savings and loan associations
56
Other insurance companies
57
Finance companies
58
REITs
59
Open-end investment companies ..
16.3
3.6
24.9
1.2
2.2
6.0
.5
9.5
6.5
-1.2
17.3
5.8
16.2
1.2
3.5
4.8
.9
6.0
.6
-.7
3.2
10.3
-.8
1.2
.3
-2.3
1.0
.5
-1.4
-.1
2.6
15.7
5.5
2.3
-.8
.1
.9
6.4
-2.4
-1.0
5.8
20.5
27.7
1.1
1.3
9.9
.9
17.6
-2.2
-.9
23.1
18.3
40.0
1.3
6.7
14.3
1.1
18.6
-1.0
-1.0
3.5
17.2
7.8
2.1
-.3
.3
.9
7.2
-2.7
.4
4.7
17.9
25.1
.8
1.3
8.3
.9
16.7
-2.4
-.6
6.8
23.1
30.4
1.5
1.2
11.5
1.0
18.5
-2.0
-1.3
21.9
16.6
42.2
1.5
5.8
16.4
1.0
18.9
-1.0
-.5
24.3
20.1
37.8
1.1
7.6
12.2
1.1
18.2
-1.0
-1.5
21.4
26.6
42.9
1.1
6.2
10.4
1.0
24.7
-.4
-.3
38
39
40
41
42
43
44
45
46
47
48
49
All sectors
60 Total funds raised, by instrument
248.0
230.5
223.5
296.0
392.5
481.7
303.4
345.8
439.2
465.2
498.3
477.4
61 Investment compnay shares
62 Other corporate equities
63 Debt instruments
64
U.S. government securities
65
State and local obligations
66
Corporate and foreign bonds
67
Mortgages
68
Consumer credit
69 Bank loans n.e.c
70
Open market paper and RPs
71 Other loans
-1.2
10.4
238.8
28.3
14.7
13.6
79.9
26.0
48.8
8.3
19.1
-.7
4.8
226.4
34.3
16.5
23.9
60.5
9.9
41.0
17.7
22.7
-.1
10.8
212.8
98.2
16.1
36.4
57.2
9.7
-12.2
-1.2
8.7
-1.0
12.9
284.1
88.1
15.7
37.2
87.1
25.6
7.0
8.1
15.3
-.9
4.9
388.5
84.3
23.7
36.1
134.0
40.6
29.8
15.0
25.2
-1.0
4.7
478.0
95.2
28.3
31.6
149.0
50.6
58.4
26.4
38.6
.4
9.9
293.1
82.9
10.9
37.7
95.5
27.6
10.6
9.6
18.23
-.6
2.6
343.8
71.2
22.3
31.2
122.9
36.6
25.1
15.9
18.5
-1.3
7.2
433.3
97.4
25.0
41.1
145.1
44.5
34.4
14.0
31.8
-.5
.1
465.5
100.0
27.8
34.2
141.6
50.1
54.9
22.4
34.6
-1.5
9.4
490.4
90.4
28.7
29.1
156.4
51.0
61.8
30.4
42.5
-.3
5.3
472.4
75.3
17.5
37.2
163.2
47.7
50.3
41.3
39.9
Flow of Funds
1.60
A45
1977
1979
DIRECT A N D INDIRECT SOURCES OF F U N D S TO CREDIT MARKETS
Billions of dollars, except as noted; quarterly data are at seasonally adjusted annual rates
1976
Transaction category, or sector
1973
1974
1975
1977
1976
1978
1978
H2
1 Total funds advanced in credit markets to
nonfinancial sectors
HI
H2
HI
H2
HI
195.4
187.4
200.7
261.1
355.4
398.2
266.8
296.9
373.8
387.1
409.3
383.8
By public agencies and foreign
Total net advances
U.S. government securities
Residential mortgages
FHLB advances to S&Ls
Other loans and securities
31.8
9.5
8.2
7.2
6.9
53.7
11.9
14.7
6.7
20.5
44.6
22.5
16.2
-4.0
9.8
54.3
26.8
12.8
-2.0
16.6
85.1
40.2
20.4
4.3
20.2
109.7
43.9
26.5
12.5
26.9
60.3
30.2
14.7
-2.0
17.4
66.1
27.1
18.9
2.9
17.2
104.2
53.3
22.0
5.8
23.1
102.8
43.7
22.2
13.2
23.7
116.6
44.0
30.7
11.8
30.1
47.3
-27.4
36.2
7.7
30.7
Total advanced, by sector
U.S. government
Sponsored credit agencies
Monetary authorities
Foreign
Agency borrowing not included in line 1
2.8
19.1
9.2
.6
19.9
9.8
26.5
6.2
11.2
23.1
15.1
14.8
8.5
6.1
13.5
8.9
20.3
9.8
15.2
18.6
11.8
26.8
7.1
39.4
26.3
20.4
44.6
7.0
37.7
41.4
11.9
22.2
6.2
20.0
20.7
5.9
21.6
10.2
28.3
22.6
17.8
32.0
4.0
50.4
29.9
19.4
39.4
13.4
30.6
38.5
21.4
49.8
.5
44.9
44.3
24.4
52.9
-.6
-29.5
48.0
183.6
18.8
14.7
10.0
48.4
98.8
7.2
156.8
22.4
16.5
20.9
26.9
76.8
6.7
169.7
75.7
16.1
32.8
23.2
17.9
-4.0
225.4
61.3
15.7
30.5
52.7
63.3
-2.0
276.5
44.1
23.7
22.5
83.3
107.3
4.3
330.0
51.3
28.3
22.5
88.2
152.2
12.5
227.2
52.7
10.9
31.8
58.2
71.6
-2.0
253.5
44.1
22.3
18.0
77.1
94.9
2.9
299.6
44.1
25.0
27.0
89.4
119.7
5.8
322.8
56.3
27.8
24.1
86.7
141.1
13.2
337.1
46.4
28.7
20.9
89.6
163.3
11.8
384.6
102.6
17.5
28.4
84.5
159.3
7.7
20
21
22
23
Private financial intermediation
Credit market funds advanced by private
financial institutions
Commercial banking
Savings institutions
Insurance and pension funds
Other finance
161.3
84.6
35.1
23.7
17.9
125.5
66.6
24.2
29.8
4.8
122.5
29.4
53.5
40.6
-1.0
190.3
59.6
70.8
49.9
10.0
255.9
87.6
82.0
67.9
18.4
296.9
128.7
75.9
73.5
18.7
202.2
68.3
70.4
47.9
15.5
249.1
84.6
81.4
65.2
18.0
265.0
90.7
82.6
70.6
21.2
301.7
132.5
75.8
76.9
16.6
292.0
125.0
75.9
70.2
20.8
324.4
131.4
59.3
81.3
52.4
24
25
26
27
28
29
30
31
Source of funds
Private domestic deposits
Credit market borrowing
Other sources
Foreign funds
Treasury balances
Insurance and pension reserves
Other, net
161.3
97.3
23.4
40.6
3.0
-1.0
18.4
20.2
125.5
67.5
15.9
42.1
10.3
-5.1
26.2
10.6
122.5
92.0
-1.4
32.0
-8.7
-1.7
29.7
12.7
190.3
124.6
4.4
61.3
-4.6
-.1
34.5
31.4
255.9
141.2
26.9
87.8
1.2
4.3
49.4
32.9
296.9
142.5
38.3
116.0
6.3
6.8
62.7
40.3
202.2
132.4
5.6
64.2
-2.8
-3.9
33.2
37.8
249.1
138.6
24.2
86.2
1.6
.1
45.3
39.3
265.0
143.8
29.6
91.7
.8
8.5
53.4
29.0
301.7
138.3
40.0
123.5
5.7
1.9
66.2
49.6
292.0
146.7
36.7
108.6
6.9
11.6
59.2
31.0
324.4
111.8
40.5
172.1
52.2
5.5
60.8
53.6
32
33
34
35
36
37
Private domestic nonfinancial investors
Direct lending in credit markets
U.S. government securities
State and local obligations
Corporate and foreign bonds
Commercial paper
Other
45.7
18.8
5.4
2.0
9.8
9.7
47.2
18.9
9.3
5.1
5.8
8.0
45.8
24.1
8.4
8.4
-1.3
6.2
39.5
16.1
3.8
5.8
1.9
11.8
47.5
23.0
2.6
-3.3
9.5
15.7
71.4
33.2
4.5
-1.4
16.3
18.7
30.6
11.0
-1.5
6.0
1.6
13.5
28.6
11.9
-.5
-.1
8.2
9.2
64.1
34.2
5.7
-6.5
10.8
19.9
61.1
32.1
7.0
-3.7
8.2
17.5
81.7
34.4
2.0
1.0
24.4
20.0
100.7
66.5
-3.0
3.8
9.4
24.1
38
39
40
41
42
43
44
45
46
47
Deposits and currency
Security RPs
Money market fund shares
Time and savings accounts
Large negotiable CDS
Other at commercial banks
At savings institutions
Money
Demand depostis
Currency
101.2
11.0
98.1
.2
1.3
84.0
-14.3
38.8
59.4
12.6
6.4
6.2
131.9
2.3
75.7
17.8
29.5
28.5
14.5
10.6
3.9
73.8
-2.2
2.4
65.4
18.4
25.3
21.8
8.2
1.9
6.3
113.5
-13.6
57.9
69.1
16.1
8.8
7.3
149.5
2.2
.2
121.0
9.0
43.0
69.0
26.1
17.8
8.3
151.8
7.5
6.9
115.2
10.8
43.3
61.1
22.2
12.9
9.3
141.0
3.2
5
122.9
-7.8
61.5
69.3
14.3
5.8
8.6
144.5
4.3
-.5
115.3
-4.5
47.5
72.3
25.4
19.6
5.8
154.5
.2
.9
126.7
22.6
38.4
65.7
26.8
16.1
10.8
148.7
9.8
61
110.7
10.1
42.1
58.5
22.1
11.6
10.5
154.8
5.1
7.7
119.8
11.4
44.5
63.8
22.3
14.2
8.1
121.8
10.5
30 2
77.2
-39.4
61.1
55.5
3.8
-6.1
10.0
48
Total of credit market instrument, deposits and currency
146.9
121.0
143.9
171.4
197.0
223.2
171.6
173.1
218.6
209.8
236.6
222.5
16.3
28.7
22.2
20.8
25.4
27.5
22.6
22.2
27.9
26.5
28.5
12.3
87.9
3.6
80.0
21.5
72.2
-2.6
84.4
10.6
92.5
40.5
90.0
44.0
89.0
17.3
98.2
29.9
88.5
51.2
93.5
36.3
86.6
51.8
84.4
22.7
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
49
50
51
Private domestic funds advanced
Total net advances
U.S. government securities
State and local obligations
Corporate and foreign bonds
Residential mortgages
Other mortgages and loans
LESS: F H L B a d v a n c e s
Public support rate (in percent)
Private financial intermediation (in percent)
Total foreign funds
*
MEMO: Corporate equities not included
52
53
54
Total net issues
Mutual fund shares
Other equities
9.2
4.1
10.7
11.9
4.0
3.7
10.3
2.1
5.9
-.4
7.9
5.0
-1.2
10.4
-.7
4.8
-.1
10.8
-1.0
12.9
-.9
4.9
-1.0
4.7
.4
9.9
-.6
2.6
-1.3
7.2
-.5
.1
-1.5
9.4
-.3
5.3
55
56
Acquisitions by financial institutions
Other net purchases
13.1
-3.9
5.8
-1.7
9.6
1.1
12.3
-.4
7.4
-3.4
7.6
-3.8
11.8
-1.5
6.8
-4.7
8.1
-2.2
.4
-.8
14.7
-6.8
14.2
-9.2
NOTES BY LINE NUMBER.
1.
2.
6.
11.
12.
17.
25.
26.
28.
Line 2 of p. A-44.
Sum of lines 3-6 or 7-10.
Includes farm and commercial mortgages.
Credit market funds raised by federally sponsored credit agencies, and net
issues of federally related mortgage pool securities. Included below in lines
3, 13, 33.
Line 1 less line 2 plus line 11. Also line 19 less line 26 plus line 32. Also sum
of lines 27, 32, 39, and 44.
Includes farm and commercial mortgages.
Sum of lines 39 and 44.
Excludes equity issues and investment company shares. Includes line 18.
Foreign deposits at commercial banks, bank borrowings from foreign branches,
and liabilities of foreign banking agencies to foreign affiliates.
29. Demand deposits at commercial banks.
30. Excludes net investment of these reserves in corporate equities.
31. Mainly retained earnings and net miscellaneous liabilities.
32. Line 12 less line 19 plus line 26.
33-37. Lines 13-17 less amounts acquired by private finance. Line 37 includes
mortgages.
45. Mainly an offset to line 9.
46. Lines 32 plus 38, or line 12 less line 27 plus 45.
47. Line 2/line 1.
48. Line 19/line 12.
49. Sum of lines 10 and 28.
50. 52. Includes issues by financial institutions.
NOTE. Full statements for sectors and transaction types quarterly, and annually
for flows and for amounts outstanding, may be obtained from Flow of Funds
Section, Division of Research and Statistics, Board of Governors of the Federal
Reserve System, Washington, D.C. 20551.
A46
2.10
Domestic Nonfinancial Statistics • February 1980
NONFINANCIAL BUSINESS ACTIVITY
Selected Measures
1967 = 100; monthly and quarterly data are seasonally adjusted. Exceptions noted.
1979
1977
Measure
1978
1980
1979
June
July
Aug.
Sept.
Nov. r
Oct.'
Dec.'
Jan.
1 Industrial production 1
138.2
146.1
152.2
152.6
152.8
151.6
152.4
152.2
152.1
152.3
152.7
Market groupings
Products, total
Final, total
Consumer goods
Equipment
Intermediate
Materials
137.9
135.9
145.3
123.0
145.1
138.6
144.8
142.2
149.1
132.8
154.1
148.3
149.8
147.0
150.5
142.2
160.0
156.0
150.2
147.6
151.8
141.9
159.5
156.5
149.7
147.1
150.8
142.1
159.4
157.6
148.7
145.6
148.2
141.8
160.6
156.0
149.9'
147.2'
149.7'
143.9'
159.8 r
156.3'
149.6
146.8
149.7
142.9
159.8
156.3
149.4
146.7
148.9
143.7
159.7
156.2
149.9
147.2
148.9
144.9
159.8
156.1
150.1
147.4
148.4
146.1
160.1
156.6
138.4
146.8
153.3
153.9
154.1
152.4
153.5'
153.2
152.9
152.9
153.3
81.9
82.7
84.4
85.6
85.7
85.6
86.2
87.5
86.1
87.9
84.9
86.8
85.3
86.7
84.9
86.6
84.6
86.3
84.3
85.9
84.3
86.0
11 Construction contracts 3
160.5
174.3
177.0
165.0
164.0
185.0
171.0
156.0
183.0
n.a.
12 Nonagricultural employment, total 4
13 Goods-producing, total
14
Manufacturing, total
15
Manufacturing, production-worker
16 Service-producing
17 Personal income, total 5
18 Wages and salary disbursements
19
Manufacturing
20 Disposable personal income
125.3
104.5
101.2
98.8
136.7
244.4
230.2
198.3
194.8
131.4
109.8
105.3
102.8
143.2
274.1
258.1
222.4
217.7
136.0
114.0
107.9
104.9
148.1
306.9
287.1
246.8
136.2
114.4
108.3
105.5
148.1
304.0
285.5
245.9
136.3
114.7
108.4
105.5
148.2
308.5
287.7
247.6
136.4
114.1
107.8
104.5
148.7'
310.6 r
289.2
246.3
244.8
136.5
114.1
107.7
104.5
148.8'
312.8'
291.9 r
248.7 r
136.8
114.0
107.5
104.1
149.3
315.9
294.1
250.6
136.9
113.8
107.1
103.6
149.6
319.2
297.1
251.9
250.6
137.1
114.4
107.4
103.9
149.6
322.8
300.0
255.0
137.6
114.6
107.3
103.7
150.2
n.a.
n.a.
n.a.
n.a.
21 Retail sales6
229.8
253.8
280.9
274.4
276.5
285.8
293.9
288.9
292.0
293.5
300.1
Prices1
22 Consumer
23 Producer finished goods
181.5
180.6
195.4
194.6
216.6
213.7
218.9
216.2
221.1
217.3
223.4
220.4
225.4
223.7
227.5
225.9
229.9
227.8
n.a.
n.a.
2
3
4
5
6
7
Industry groupings
8 Manufacturing
Capacity utilization
(percent2
9 Manufacturing
10 Industrial materials industries
6. Based on Bureau of Census data published in Survey of Current Business
(U.S. Department of Commerce).
7. Data without seasonal adjustment, as published in Monthly Labor Review
(U.S. Department of Labor). Seasonally adjusted data for changes in the price
indexes may be obtained from the Bureau of Labor Statistics, U.S. Department
of Labor.
1. The industrial production and capacity utilization series have been revised.
For a description of the changes see the August 1979 BULLETIN, pp. 603-07.
2. Ratios of indexes of production to indexes of capacity. Based on data from
Federal Reserve, McGraw-Hill Economics Department, and Department of Commerce.
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 in Employment and Earnings (U.S. Department of Labor).
Series covers employees only, excluding personnel in the Armed Forces.
5. Based on data in Survey of Current Business (U.S. Department of Commerce).
Series for disposable income is quarterly.
2.11
NOTE: Basic data (not index numbers) for series mentioned in notes 4, 5, and
6, and indexes for series mentioned in notes 3 and 7 may also be found in the
Survey of Current Business (U.S. Department of Commerce).
Figures for industrial production for the last two months are preliminary and
estimated, respectively.
OUTPUT, CAPACITY, AND CAPACITY UTILIZATION'
Seasonally adjusted
1979
1979
Q1
Q2
Q3
Q4
Output (167 = 100)
Q1
Q2
1979
Q3'
Q4'
Capacity (percent of 1967 output)
Q2'
Q1'
Q3
Q4R
Utilization rate (percent)
1 Manufacturing
153.4
153.1
153.3
153.0
176.9
178.2
179.5
180.8
86.7
85.9
85.4
84.6
2 Primary processing
162.1
148.7
161.9
148.5
163.4
148.1
161.9'
148.2
182.7
173.8
184.2
175.0
185.7
176.2
187.2
177.4
88.7
85.6
87.9
84.8
88.0
84.0
86.5
83.5
155.5
155.6
156.6
156.2 '
176.7 '
178.1
179.5
181.0
88.0
87.3
87.2'
86.3
158.4
124.7
172.2
179.1
118.2
136.9
222.7
127.9
157.7
124.3
173.4
181.3
119.6
140.7
224.8
128.1
158.7
126.9
175.7
184.3
122.4
147.0
226.6
128.3
156.2'
119.6
177.8 r
186.4 r
123.6
148.1
229.5
129.4'
181.5
139.8
191.7'
199.4'
136.9
148.6'
247.2'
146.7
183.0
140.3
193.5'
201.3'
137.3
149.6'
250.3'
147.5
184.5
140.7
195.3
203.2
137.7
150.6
253.3
148.3
186.0
141.1
197.3
205.3
138.1
151.6
256.3
149.2
87.3
89.2
89.8
89.8
86.3
92.1
90.1
87.1
86.2
88.5
89.6
90.0
87.1
94.0
89.8
86.9
86.0
90.2
89.9'
90.7'
88.9
97.6'
89.5'
86.5
84.0
84.8
90.1
90.8
89.5
97.6
89.5
86.7
3 Advanced processing
4 Materials
5 Durable goods
6
Metal materials
7 Nondurable goods
8
Textile, paper, and chemical
9
Textile
10
Paper
11
Chemical
12 Energy
1. The capacity utilization series has been revised. For a description of the
changes, see the August 1979 BULLETIN, pp. 606-07.
Labor Market
2.12
A47
LABOR FORCE, EMPLOYMENT, A N D UNEMPLOYMENT
Thousands of persons; monthly data are seasonally adjusted. Exceptions noted.
1979
Category
1977
1978
1980
1979
July
Aug.
Sept.
Oct.
Nov.
Dec.
Jan.
HOUSEHOLD SURVEY DATA
1
1 Noninstitutional population
158,559
161,058
163,620
163,685
163,891
164,106
164,468
164,682
164,898
165,101
99,534
97,401
102,537
100,420
104,996
102,908
105,141
103,059
105,218
103,128
105,586
103,494
105,688
103,595
105,744
103,652
106,088
103,999
106,310
104,229
87,302
3,244
91,031
3,342
93,648
3,297
93,949
3,262
93,689
3,315
94,, 140
3,364
94,180
3,294
94,223
3,385
94,553
3,359
94,534
3,270
6,855
6,047
5,963
5,848
6,124
5,990
6,121
6,044
6,087
6,425
7.0
59,025
6.0
58,521
5.8
58,623
5.7
58,545
5.9
58,673
5.8
58,519
5.9
58,780
5.8
59,937
5.9
58,810
6.2
58,791
9 Nonagricultural payroll employment 3
82,423
86,446
89,497
89,713
89,762
89,803
89,982
90,100'
90,231'
90,536
Manufacturing
Mining
Contract construction
Transportation and public utilities
Trade
Finance
Service
Government
19,682
813
3,851
4,713
18,516
4,467
15,303
15,079
20,476
851
4,271
4,927
19,499
4,727
16,220
15,476
20,979
958
4,642
5,154
20,140
4,964
17,047
15,613
21,079
956
4,688
5,169
20,122
4,972
17,092
15,635
20,957
968
4,674
5,194
20,126
5,003
17,141
15,699
20,949
973
4,671
5,180
20,169
4,997
17,191
15,673
20,899
979
4,694
5,218
20,243
5,018
17,257
15,674
20,836'
983'
4,714'
5,229'
20,308r
5,039'
17,298'
15,693'
20,882'
992'
4,780'
5,206'
20,246'
5,054'
17,360'
15,711'
20,867
995
4,843
5,236
20,378
5,071
17,414
15,732
2 Labor force (including Armed
Forces) 1
3 Civilian labor force
Employment
4
Nonagricultural industries 2
5
Agriculture
Unemployment
Number
6
7
Rate (percent of civilian labor
force)
8 Not in labor force
ESTABLISHMENT SURVEY DATA
10
11
12
13
14
15
16
17
1. Persons 16 years of age and over. Monthly figures, which are based on sample
data, relate to the calendar week that contains the 12th day; annual data are
averages of monthly figures. By definition, seasonality does not exist in population
figures. Based on data from Employment and Earnings (U.S. Dept. of Labor).
2. Includes self-employed, unpaid family, and domestic service workers.
3. Data include all full- and part-time employees who worked during, or
received pay for, the pay period that includes the 12th day of the month, and
exclude proprietors, self-employed persons, domestic servants, unpaid family
workers, and members of the Armed Forces. Data are adjusted to the February
1977 benchmark. Based on data from Employment and Earnings (U.S. Dept. of
Labor).
A48
2.13
Domestic Nonfinancial Statistics • February 1980
INDUSTRIAL PRODUCTION
Indexes and Gross Value'
Monthly data are seasonally adjusted.
1967
Grouping
tion
1978
1979
Average
Nov.
1979
Dec.
Jan.
1979
May
June
July
Aug.
1980
Sept.
Oct/
Nov.
Dec.P
Jan/
Index (1967 = 100)
MAJOR MARKET
1
Total index
2
3
4
5
6
7
Products
Final products
Consumer goods
Equipment
Intermediate products
Materials
Consumer goods
Durable consumer goods
Automotive products
1U
Autos and utility vehicles
11
Autos
Auto parts and allied goods
12
8
Y
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
Home goods
Appliances, A/C, and TV
Appliances and TV
Carpeting and furniture
Miscellaneous home goods
Nondurable consumer goods
Consumer staples
Consumer foods and tobacco
Nonfood staples
Consumer chemical products
Consumer paper products
Consumer energy products
Residential utilities
Equipment
Business
Industrial
Building and mining
Manufacturing
Power
Commercial transit, farm
Commerical
Transit
Farm
100.00
152.2
150.6
151.8
151.5
152.4
152.6
152.8
151.6
152.4
152.2
152.1
152.3
152.7
60.71
47.82
27.68
20.14
12.89
39.29
149.8
147.0
150.5
142.2
160.0
156.0
148.0
145.3
151.3
137.1
157.8
154.5
149.0
146.1
151.5
138.6
159.9
156.2
149.2
146.1
150.6
139.9
160.8
155.0
150.3
147.8
152.0
141.9
159.5
155.7
150.2
147.6
151.8
141.9
159.5
156.5
149.7
147.1
150.8
142.1
159.4
157.6
148.7
145.6
148.2
141.8
160.6
156.0
149.9
147.2
149.7
143.9
159.8
156.3
149.6
146.8
149.7
142.9
159.8
156.3
149.4
146.7
148.9
143.7
159.7
156.2
149.9
147.2
148.9
144.9
159.8
156.1
150.1
147.4
148.4
146.1
160.1
156.6
7.89
2.83
2.03
1.90
80
155.6
167.9
154.3
136.7
202.3
162.9
190.2
185.0
159.7
203.2
161.8
186.9
179.2
151.9
206.5
160.4
181.4
173.2
145.8
202.2
160.5
182.7
176.3
153.1
199.0
158.6
175.9
167.4
148.0
197.5
157.2
170.3
155.6
141.8
207.8
147.5
147.3
125.1
118.5
203.7
151.8
157.6
139.7
128.0
203.0
152.6
159.2
142.4
129.0
202.1
149.3
150.6
131.0
118.3
200.3
147.6
143.3
121.2
110.2
199.7
144.4
133.8
108.2
98.5
199.0
5.06
1.40
1.33
1.07
2.59
148.7
127.4
129.3
170.7
151.2
147.6
129.1
130.1
164.2
150.7
147.7
129.8
130.6
164.3
150.6
148.6
124.0
124.8
170.7
152.8
148.1
128.4
130.2
170.2
149.6
148.8
129.3
131.2
170.6
150.5
149.8
129.7
131.6
171.9
151.6
147.7
121.2
124.1
171.7
152.1
148.5
129.6
132.2
169.7
150.0
148.8
128.0
130.2
169.2
151.7
148.5
128.6
131.4
170.3
150.3
149.9
135.9
138.2
168.5
149.9
150.3
135.0
19.79
4.29
15.50
8.33
148.5
146.7
132 4
150.6
141.7
147.3
132 2
151.5
143.2
146.7
130.1
151.3
141.8
148.7
128 6
154*2
145.7
149.1
130.7
154.2
146.2
148.2
126 9
154^1
147.0
148.5
128 0
154^2
145.3
148.9
129 0
154*3
146.5
148.6
127 7
1543
146.7
148.7
129 1
154.2
145.7
149.4
150.0
155.1
146.5
155.7
7.17
2.63
1.92
2.62
1.45
163.7
205.7
120.9
153.0
161.0
195.9
119.0
156.8
162.7
161.2
196.5
118.0
157.6
162.5
162.4
200.3
119.2
156.0
166.2
164.1
205.2
121.3
154.3
167.8
163.5
205.9
121.1
152.0
162.3
162.4
206.1
119.9
149.8
158.5
164.6
209.2
121.2
151.6
163.5
163.5
207.2
121.1
150.8
162.2
163.2
206.4
121.6
150.5
164.2
164.0
207.9
120.3
151.9
166.7
165.1
209.8
120.9
152.6
166.6
12.63
6.77
1.44
3.85
1.47
171.4
152.2
206.4
130.4
156.3
165.0
147.6
207.8
123.3
152.1
166.8
148.4
206.3
124.5
154.2
168.1
151.4
208.8
127.4
157.8
171.4
151.8
203.7
130.1
157.7
171.5
152.0
205.3
130.1
156.8
171.4
151.3
207.4
130.3
151.0
171.5
151.7
210.6
131.1
147.7
173.6
153.5
212.0
130.4
156.3
172.0
151.2
200.6
130.8
156.3
172.7
153.3
204.4
132.5
157.6
174.5
154.8
209.0
133.2
157.9
176.3
159.8
229.4
134.0
158.9
5.86
3.26
1.93
67
193.4
227.8
152.2
144.8
185.0
217.8
145.7
138.5
188.0
218.7
151.0
144.6
187.4
220.8
146.8
142.0
193.9
224.9
156.7
150.8
194.0
226.4
155.3
148.1
194.6
227.0
155.2
151.0
194.4
230.5
149.4
148.3
196.8
231.4
156.3
145.3
195.9
234.2
154.9
128.0
195.2
233.2
150.3
139.5
197.4
235.1
153.9
139.5
195.4
236.3
145.8
153.9
145.4
150.8
36
Defense and space
7.51
93.2
90.3
91.4
92.4
92.5
92.3
92.8
92.0
94.0
94.0
94.8
95.0
95.2
37
38
39
Intermediate products
Construction supplies
Business supplies
Commercial energy products
6.42
6.47
1.14
156.9
163.0
172.2
156.1
159.6
171.3
158.3
161.5
173.0
159.1
162.5
173.6
156.4
162.5
172.6
156.3
162.6
169.4
156.4
162.4
167.8
157.3
163.8
170.7
156.3
163.2
169.8
156.8
162.7
172.2
156.7
162.6
174.4
156.3
163.2
175.0
156.2
40
41
42
43
44
Materials
Durable goods materials
Durable consumer parts
Equipment parts
Durable materials n.e.c
Basin metal materials
20.35
4.58
5.44
10.34
5.57
157.7
137.1
189.9
150.0
124.1
157.0
147.2
176.7
151.0
130.2
159.5
148.6
179.2
154.0
132.0
158.1
148.5
182.2
149.7
124.4
157.9
142.5
188.0
149.0
122.9
159.5
141.8
191.0
150.8
126.1
160.7
138.5
192.1
154.0
130.5
157.7
129.7
190.7
152.7
127.7
157.6
132.2
192.0
150.7
124.8
157.2
132.0
192.7
149.6
121.4
155.9
126.8
195.1
148.2
119.9
155.5
123.7
196.4
148.0
118.3
155.7
122.5
198.7
147.7
45
46
47
48
49
50
51
Nondurable goods materials
Textile, paper, and chemical materials .
Textile materials
Paper materials
Chemical materials
Containers, nondurable
Nondurable materials n.e.c
10.47
7.62
1.85
1.62
4.15
1.70
1.14
174.8
182.8
121.0
143.1
225.9
164.5
136.6
170.2
177.1
118.8
137.9
218.4
163.1
135.2
171.9
178.9
120.1
139.1
220.8
164.8
135.7
171.0
177.5
118.3
133.3
221.2
167.8
132.5
173.8
181.5
118.8
140.1
225.7
163.3
138.4
173.4
181.7
122.9
141.1
223.9
159.2
139.0
174.6
182.8
122.2
146.2
224.1
163.1
137.5
175.8
184.3
120.6
146.7
227.5
162.9
138.2
176.7
185.9
124.4
148.1
228.2
161.8
136.9
177.2
186.1
124.3
148.6
228.4
166.1
134.4
177.7
185.9
123.2
148.4
228.6
167.8
137.8
178.6
187.2
123.3
147.2
231.5
167.9
136.5
179.3
188.3
52
53
54
Energy materials
Primary energy
Converted fuel materials
8.48
4.65
3.82
128.5
113.1
147.2
129.3
117.0
144.4
128.8
116.1
144.4
127.8
111.9
147.0
127.7
111.7
147.2
128.3
112.4
147.6
129.1
112.8
148.8
127.7
112.0
146.9
128.1
113.6
145.7
128.5
114.6
145.3
130.0
114.6
148.8
129.6
114.7
147.8
130.7
55
56
57
58
Supplementary groups
Home goods and clothing
Energy, total
Products
Materials
9.35
12.23
3.76
8.48
139.7
137.8
158.8
128.5
140.6
139.1
161.2
129.3
140.6
139.1
162.2
128.8
140.1
138.1
161.4
127.8
139.1
137.6
159.9
127.7
140.5
137.2
157.3
128.3
139.3
137.1
155.2
129.1
138.6
136.8
157.4
127.7
139.5
136.8
156.5
128.1
139.1
137.2
157.1
128.5
139.6
138.9
158.7
130.0
140.4
138.8
159.4
129.6
140.7
140.0
For notes see opposite page.
130.7
Output
2.13
A49
Continued
Grouping
SIC
code
1967
proportion
1979
1978
1979
Average
Nov.
c
Dec.
Jan.
May
June
July
Aug.
c
1980
Sept.
Oct.
r
Nov.
Dec .P
Jan. 4,
Index (1967 = 100)
MAJOR INDUSTRY
12 05
6.36
5.69
3.88
87.95
35.97
51.98
144.6
125.3
166.2
10
11,12
13
14
1 Mining and utilities
2
Mining
3
Utilities
4
Electric
5 Manufacturing
Nondurable
6
7
Durable
145.0
127.4
164.7
186.7
152.9
161.7
146.8
143.9
123.8
166.2
188.4
152.5
160.7
146.8
143.4
122.8
166.5
186.4
153.8
162.8
147.6
143.0
123.9
164.2
182.4
153.9
163.0
147.6
143.7
124.7
164.8
182.2
154.1
164.1
147.2
144.9
126.4
165.5
183.6
152.4
164.3
144.2
144.5
125.8
165.3
184.1
153.5
164.6
145.9
146.0
128.1
166.1
184.3
153.2
164.0
145.7
147.6
129.8
167.4
149.0
132.0
168.0
149.7
132.9
168.4
153.3
163.3
146.4
144.8
128.0
163.7
185.2
151.6
160.4
145.5
152.9
164.4
144.9
152.9
164.7
144.7
153.3
165.5
144.8
.51
.69
4.40
.75
126.7
133.6
121.7
137.5
124.3
144.6
124.8
133.8
123.8
144.7
123.8
134.8
124.2
115.9
123.0
135.9
123.1
133.4
118.6
137.8
123.2
137.5
119.6
137.3
128.6
137.1
120.4
136.4
126.5
144.1
121.6
138.3
122.1
142.6
121.6
137.5
124.1
144.7
124.2
138.2
132.0
141.9
125.7
141.2
135.7
147.7
127.7
140.3
147.3
129.0
8
9
10
11
Mining
Metal
Coal
Oil and gas extraction
Stone and earth minerals
12
13
14
15
16
Nondurable manufacturers
Foods
Tobacco products
Textile mill products
Apparel products
Paper and products
20
21
22
23
26
8.75
.67
2.68
3.31
3.21
147.9
117.2
143.8
130.8
150.8
143.7
118.8
140.4
135.8
146.7
144.7
119.1
141.7
136.5
148.5
143.9
120.6
141.6
130.3
144.6
149.2
120.2
141.5
128.2
147.9
149.5
118.3
114.6
132.0
148.0
149.4
118.9
143.0
129.7
154.0
148.1
107.5
144.1
130.1
153.9
148.8
115.6
146.9
131.2
155.3
148.6
115.6
146.0
128.5
154.1
148.3
114.7
147.4
129.3
153.3
148.2
153.9
154.4
17
18
19
20
21
Printing and publishing
Chemicals and products
Petroleum products
Rubber and plastic products ...
Leather and products
27
28
29
30
31
4.72
7.74
1.79
2.24
.86
136.9
210.4
143.6
270.4
71.2
133.7
204.6
150.2
263.0
73.4
134.4
207.2
151.3
263.3
73.8
135.6
206.5
147.0
267.4
74.8
136.8
209.7
142.4
270.0
72.3
136.9
207.8
143.9
270.0
70.1
135.6
210.5
143.9
278.0
69.7
137.7
213.1
143.0
275.7
69.7
137.1
212.0
143.1
272.9
70.8
137.2
211.4
141.1
274.5
70.1
136.5
214.5
141.6
271.1
70.4
137.9
216.6
142.5
266.0
70.9
145.0
Durable manufactures
22 Ordnance, private and
government
23 Lumber and products
24 Furniture and fixtures
25 Clay, glass, stone products
19,91
24
25
32
3.64
1.64
1.37
2.74
75.3
136.9
161.4
163.2
74.2
140.1
158.6
162.1
74.6
144.0
157.6
164.0
74.9
137.3
161.7
167.4
75.3
136.1
159.6
163.8
75.1
136.8
159.6
162.7
74.6
135.2
159.5
163.3
74.9
138.0
161.7
161.4
75.3
138.6
162.0
160.6
75.3
138.7
163.3
162.3
75.9
135.6
162.9
162.8
75.7
133.4
160.7
163.5
26
27
28
29
30
33
331,2
34
35
36
6.57
4.21
5.93
9.15
8.05
121.3
113.3
148.6
163.7
175.0
130.8
124.4
145.6
157.8
165.2
132.1
125.3
147.1
158.1
167.7
123.4
113.3
149.1
161.2
170.9
121.0
114.3
150.3
164.3
174.7
124.3
118.1
149.3
164.5
175.1
127.1
119.0
149.3
165.3
174.4
121.0
112.0
147.6
166.2
171.7
121.7
115.0
146.5
165.1
176.7
118.0
108.2
147.5
162.3
177.3
117.2
108.0
146.9
163.1
179.4
116.4
107.8
146.8
162.5
181.4
146.7
167.9
182.2
37
371
9.27
4.50
135.3
160.0
142.1
181.9
142.9
182.1
141.2
177.9
141.9
176.3
139.4
169.6
135.5
160.2
124.7
138.5
131.7
150.6
133.7
150.6
128.2
139.9
126.2
135.4
121.8
126.7
372-9
38
39
4.77
2.11
1.51
112.0
174.9
153.9
104.7
171.3
151.1
106.0
173.1
151.7
106.6
175.2
152.0
109.6
174.7
150.7
111.0
175.9
152.7
112.2
174.0
155.7
111.8
173.9
155.7
113.9
172.9
153.6
117.7
175.0
154.5
117.1
173.4
155.3
117.6
175.9
156.0
117.3
175.7
156.1
Primary metals
Iron and steel
Fabricated metal products
Nonelectrical machinery
Electrical machinery
31 Transportation equipment
32 Motor vehicles and parts
33 Aerospace and miscellaneous
transportation equipment .
34 Instruments
35 Miscellaneous manufactures ....
146.6
139.3
75.5
114.6
Gross value (billions of 1972 dollars, annual rates)
MAJOR MARKET
36 Products, total
507.4
623.9
625.0
631.1
626.8
632.3
628.7
622.7
613.0
622.6
621.6
617.0
618.0
617.4
37 Final
38 Consumer goods
39 Equipment
40 Intermediate
390.9 2
277.5 2
113.42
116.6 2
479.8
326.2
153.6
144.1
482.8
332.8
150.0
142.3
486.6
334.1
152.4
144.5
481.7
328.9
152.9
145.1
488.2
331.5
156.7
144.2
485.1
329.8
155.4
143.6
479.6
326.0
153.6
143.2
468.8
319.2
149.6
144.2
478.8
323.6
155.2
143.8
477.6
324.6
153.0
144.0
473.7
321.8
151.9
143.3
474.6
321.4
153.2
143.4
473.6
319.2
154.4
143.8
1. The industrial prodcution series has been revised. For a description of the
changes, see "Revision of Industrial Production Index" in the August 1979 BULLETIN, pp. 603-05.
2. 1972 dollars.
NOTE. Published groupings include some series and subtotals not shown separately. For description and historical data, see Industrial Production—1976 Revision
(Board of Governors of the Federal Reserve System: Washington, D.C.), December 1977.
A50
2.14
Domestic Nonfinancial Statistics • February 1980
HOUSING A N D CONSTRUCTION
Monthly figures are at seasonally adjusted annual rates except as noted.
Item
1979
1977
1978
1979
June
July
Aug.
Sept.
Oct.
Nov.
Dec .P
Private residential real estate activity
(thousand of units)
NEW UNITS
1 Permits authorized
2
1-family
3
2-or-more-family
1,677
1,125
551
1,801
1,183
618
1,537
970
566
1,639
1,012
627
1,528
1,001
527
1,654
1,030
624
1,775
1,015
760
1,542
927
615
1,263
751
512
1,204
768
436
4 Started
5
1-family
6
2-or-more-family
1,987
1,451
536
2,020
1,433
587
1,743
1,193
549
1,923
1,288
635
1,786
1,220
568
1,793
1,239
554
1,921
1,254
667
1,764'
1,159'
605'
1,522
985
537
1,527
1,071
456
7 Under construction, end of period 1
8
1-family
9
2-or-more-family
1,208
730
478
1,310
765
546
n.a.
n.a.
n.a.
1,247
723
524
1,237
715
522
1,232
714
518
1,226'
717'
508'
1,218'
708'
510'
1,198
691
507
n.a.
n.a.
n.a.
1,656
1,258
399
1,868
1,369
498
n.a.
n.a.
n.a.
1,866
1,345
521
1,745
1,192
553
1,739
1,199
540
1,943'
1,197'
746'
1,824'
1,259'
565'
1,827
1,205
622
n.a.
n.a.
n.a.
277
276
n.a.
279
282
277
268
293
257
n.a.
820
408
818
419
706
407
689
418
778
416
746
416
717'
413
692'
409
590
400
559
403
49.0
48.2
55.8
n.a.
62.7
n.a.
64.2
n.a.
63.8
n.a.
64.0
n.a.
65.0'
n.a.
62.1'
n.a.
63.4
n.a.
62.3
n.a.
54.4
62.7
72.1
74.3
71.9
74.0
76.8'
71.3'
74.2
75.1
3,572
3,905
3,742
3,560
3,770
3,850
4,010
3,990
3,560
3,420
42.8
47.1
48.7
55.1
55.5
64.0
56.8
66.1
57.9
66.7
57.7
66.3
57.3
66.1
56.3
65.2
55.6
64.6
56.5
65.2
10 Completed
11
1-family
12 2-or-more-family
13 Mobile homes shipped
14
15
16
17
18
Merchant builder activity in 1-family
units
Number sold
Number for sale, end of period 1
Price (thousand of dollars)2
Median
Units sold
Units for sale
Average
Units sold
EXISTING UNITS ( 1 - f a m i l y )
19 Number sold
Price of units sold (thous. of dollars)2
20 Median
21 Average
Value of new construction 3
(millions of dollars)
CONSTRUCTION
22 Total put in place
173,998
206,223
226,744
224,331
231,068
230,303
232,559
238,446'
237,442
239,552
23 Private
24
Residential
25
Nonresidential, total
Buildings
26
Industrial
27
Commercial
28
Other
29
Public utilities and other ....
135,824
80,957
54,867
160,403
93,425
66,978
178,079
97,160
80,919
178,348
96,937
81,411
180,103
97,022
83,081
180,635
97,537
83,098
181,626
98,996
82,630
185,566'
99,240'
86,326
185,573
99,146
86,427
188,390
99,764
88,626
7,713
14,789
6,200
26,165
10,993
18,568
6,739
30,678
14,375
24,223
7,354
34,967
14,697
24,785
7,306
34,623
15,547
24,785
7,427
35,322
13,751
25,818
7,532
35,997
13,698
25,693
7,331
35,908
15,019
26,663
7,851
36,793
15,022
26,923
7,722
36,760
14,669
28,717
8,227
37,013
30 Public
31
Military
32
Highway
33
Conservation and development
34
Other 4
38,172
1,428
8,984
3,862
23,898
45,821
1,498
10,286
4,436
29,601
48,665
1,627
11,127
4,732
31,179
45,983
1,787
10,315
3,571
30,310
50,965
1,500
11,166
5,255'
33,044'
49,669
1,859
11,507'
5,036'
31,267'
50,932
1,658
12,345
4,900
32,029
52,880
1,855
14,518
4,296
32,211
51,870
1,660
11,900
4.960
33,350
51,161
1,702
11,891
5,124
32,444
1. Not at annual rates.
2. Not seasonally adjusted.
3. Value of new construction data in recent periods may not be strictly comparable with data in prior periods due to 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 Bureau in July 1976.
4. Beginning January 1977 Highway imputations are included in Other.
NOTE. Census Bureau estimates for all series except (a) mobile homes, which
are private, domestic shipments as reported by the Manufactured Housing Institute
and seasonally adjusted by the Census Bureau, and (b) sales and prices of existing
units, which are published by the National Association of Realtors. All back and
current figures are available from originating agency. Permit authorizations are
those reported to the Census Bureau from 14,000 jurisdictions through 1977, and
16,000 jurisdictions beginning with 1978.
Prices
2.15
A51
C O N S U M E R A N D P R O D U C E R PRICES
Percentage changes based on seasonally adjusted data, except as noted
12 months to
3 months (at annual rate) to
1 month to
1979
1979
Item
1978
Dec.
1979
Dec.
Mar.
June
Sept.
Dec.
Aug.
Sept.
Oct.
Nov.
Dec.
Index
level
Dec.
1979
(1967
= 100)1
CONSUMER PRICES 2
1 All items
9.0
2 Commodities
3
Food
4
Commodities less food
Durable
5
6
Nondurable
7 Services
8
Rent
9
Services less rent
Other groupings
10 All items less food
11 All items less food and energy
12 Homeownership
13.3
13.0
13.4
13.2
13.5
1.1
1.1
1.0
1.0
1.2
229.9
8.9
11.8
7.7
9.2
8.7
9.3
7.3
9.6
13.0
10.2
14.3
10.3
14.8
13.7
7.9
14.6
14.5
17.7
12.9
10.0
16.5
10.6
3.6
11.7
13.3
7.5
15.8
9.1
25.8
13.8
8.7
14.5
12.3
4.2
16.2
8.7
25.7
14.3
10.7
15.1
12.1
11.1
12.7
13.2
11.9
15.0
8.5
16.7
.9
0
1.3
.7
1.9
1.2
.9
1.3
1.1
.9
1.2
.7
1.8
1.1
.8
1.1
.8
.8
.8
.7
.7
1.2
1.3
1.2
.9
.5
1.1
1.5
.6
1.1
.4
1.2
1.1
1.3
1 i
.9
1.1
1.3
.3
1.5
219.4
241.9
207.2
199.8
228.2
249.3
182.9
261.6
8.5
8.5
12.4
14.0
11.3
19.8
12.0
9.3
16.7
14.9
11.2
18.0
15.4
11.5
19.3
14.0
13.1
25.8
1.3
1.0
1.7
1.2
1.0
1.4
1.0
1.0
1.9
1.1
1.2
2.1
1.2
.9
1.7
226.4
218.1
286.9
9.2
9.6
11.9
8.4
8.0
10.2
8.3
12.5
14.1
7.5
17.8
8.7
10.2
16.3
14.3
16.0
21.0
13.4
10.3
17.4
14.0
7.5
6.7
-11.3
17.9
9.8
12.0
15.3
15.0
19.6
13.1
23.2
4.3
18.5
18.8
13.3
14.4
10.0
16.9
10.8
17.1
17.1
1.0
1.5'
1.2'
1.7'
-.3'
1.0'
1.4'
1.4
1.7'
1.7'
1.8'
.6'
1.5'
1.3'
1.0
1.0
-.1
1.6
1.2
1.7
1.9
1.3
1.6
2.6
1.0
.5
1.1
.9
.8
.8
— l
1.3
.9
1.2
1.2
227.8
228.8
232.0
225.0
225.1
268.2
260.1
15.6
18.3
26.6
11.1
29.2
31.0
22.2
-7.1
21.0
13.9
34.4
9.8
.7
-.2
2.9
1.4'
2.8
.5
2.0
2.0
2.7
-.1
385.8
249.7
PRODUCER PRICES
13 Finished goods
14 Consumer
15
Foods
16
Excluding foods
17 Capital equipment
18 Materials
19 Intermediate 3
Crude:
20
Nonfood
21
Food
1. Not seasonally adjusted
2. Figures for consumer prices are those for all urban consumers.
3. Excludes intermediate materials for food manufacturing and manufactured
animal feeds.
SOURCE. Bureau of Labor Statistics.
A52
2.16
Domestic Nonfinancial Statistics • February 1980
GROSS NATIONAL PRODUCT A N D INCOME
Billions of current dollars except as noted; quarterly data are at seasonally adjusted annual rates.
1978
Account
1976
1977
1979
1978
Q3
Q4
Ql
Q2
Q3
Q4P
GROSS NATIONAL PRODUCT
1 Total
1,702.2
1,899.5
2,127.6
2,159.6
2,235.2
2,292.1
2,329.8
2,396.5
2,455.8
1,089.9
157.4
443.9
488.5
1,210.0
178.8
481.3
549.8
1,350.8
200.3
530.6
619.8
1,369.3
203.5
536.7
629.1
1,415.4
212.1
558.1
645.1
1,454.2
213.8
571.1
669.3
1,475.9
208.7
581.2
686.0
1,528.6
213.4
604.7
710.6
1,580.4
215.5
631.0
733.9
243.0
233.0
164.9
57.3
107.6
68.1
65.7
303.3
281.3
189.4
62.6
126.8
91.9
88.8
351.5
329.1
221.1
76.5
144.6
108.0
104.4
356.2
336.1
225.9
79.7
146.3
110.2
106.4
370.5
349.8
236.1
84.4
151.8
113.7
110.0
373.8
354.6
243.4
84.9
158.5
111.2
107.8
395.4
361.9
249.1
90.5
158.6
112.9
109.1
392.3
377.8
261.8
95.0
166.7
116.0
112.0
383.3
376.9
261.3
98.7
162.6
115.6
111.2
10.0
12.1
21.9
20.7
22.3
21.3
20.0
18.5
20.6
19.3
19.1
18.8
33.4
32.6
14.5
12.6
6.4
2.3
15 Net exports of goods and services
16 Exports
17 Imports
8.0
163.3
155.4
-9.9
175.9
185.8
-10.3
207.2
217.5
-6.8
213.8
220.6
-4.5
224.9
229.4
4.0
238.5
234.4
-8.1
243.7
251.9
-2.3
267.3
269.5
-7.7
280.0
287.7
18 Government purchases of goods and services
19 Federal
20
State and local
361.3
129.7
231.6
396.2
144.4
251.8
435.6
152.6
283.0
440.9
152.3
288.6
453.8
159.0
294.8
460.1
163.6
296.5
466.6
161.7
304.9
477.8
162.9
314.9
499.8
177.0
322.8
1,692.1
762.7
305.9
456.8
776.7
162.7
1,877.6
842.2
345.9
496.3
866.4
190.9
2,105.2
930.0
380.4
549.6
969.3
228.2
2,139.5
940.9
382.6
558.3
981.7
237.0
2,214.5
983.8
402.3
581.6
1,005.3
246.0
2,272.9
1,011.8
425.5
586.2
1,041.4
238.9
2,296.4
1,018.1
422.4
595.7
1,064.2
247.5
2.381.9
1,036.0
424.4
611.6
1,100.6
259.8
2,449.5
1,056.2
421.0
635.2
1,135.0
264.6
10.0
5.3
4.7
21.9
11.9
10.0
22.3
13.9
8.4
20.0
10.3
9.7
20.6
13.4
7.2
19.1
18.4
.7
33.4
24.3
9.1
14.5
7.3
7.2
6.4
4.6
1.8
1,273.0
1,340.5
1,399.2
1,407.3
1,426.6
1,430.6
1,422.3
1,433.3
1,438.4
31 Total
1,359.8
1,525.8
1,724.3
1,752.5
1,820.0
1,869.0
1,897.9
1,941.9
n.a.
32 Compensation of employees
33 Wages and salaries
34
Government and government enterprises
35
Other
36
Supplement to wages and salaries
37
Employer contributions for social insurance
Other labor income
38
1,037.8
890.0
188.0
702.0
147.8
70.4
77.4
1,156.9
984.0
201.3
782.7
172.9
81.2
91.8
1,304.5
1,103.5
218.0
885.5
201.0
94.6
106.5
1,321.1
1,117.4
219.2
898.1
203.7
95.5
108.2
1,364.8
1.154.7
225.1
929.6
210.1
98.2
111.9
1,411.2
1.189.4
228.1
961.3
221.8
105.8
116.0
1,439.7
1,211.5
231.2
980.3
228.2
107.9
120.3
1,472.9
1,238.0
234.4
1,003.6
234.8
109.9
124.9
1,512.8
1,270.3
240.2
1,030.0
242.6
113.0
129.6
89.3
71.0
18.3
100.2
80.5
19.6
116.8
89.1
27.7
117.4
91.3
26.1
125.7
94.4
31.3
129.0
94.8
34.2
129.3
95.5
33.7
130.3
99.4
30.9
131.5
102.0
29.5
2
3
4
5
By source
Personal consumption expenditures
Durable goods
Nondurable goods
Services
6 Gross private domestic investment
7 Fixed investment
8
Nonresidential
9
Structures
10
Producer's durable equipment
11
Residential structures
12
Nonfarm
13
14
Change in business inventories
Nonfarm
By major type of product
21 Final sales, total
22 Goods
23
Durable
24
Nondurable
25
Services
26 Structures
27 Change in business inventories
28
Durable goods
29 Nondurable goods
30 MEMO. Total GNP in 1972 dollars
NATIONAL INCOME
39 Proprietors' income1
40
Business and professional 1
41
Farm 1
42 Rental income of persons 2
43 Corporate profits 1
44
Profits before tax 3
45
Inventory valuation adjustment
46 Capital consumption adjustment
47 Net interest
22.1
24.7
25.9
26.8
27.1
27.3
26.8
26.6
27.0
126.8
156.0
-14.6
-14.5
150.0
177.1
-15.2
-12.0
167.7
206.0
-25.2
-13.1
175.2
212.0
-23.0
-13.8
184.8
227.4
-28.8
-13.8
178.9
233.3
-39.9
-14.5
176.6
227.9
-36.6
-14.7
180.8
242.3
-44.0
-17.6
n.a.
n.a.
-46.9
-20.1
83.8
94.0
109.5
111.9
117.6
122.6
125.6
131.5
138.9
1. With inventory valuation and capital consumption adjustments.
2. With capital consumption adjustments.
3. For after-tax profits, dividends, and the like, see table 1.50.
SOURCE. Survey of Current Business (Department of Commerce).
National Income Accounts
2.17
PERSONAL INCOME A N D SAVING
Billions of current dollars; quarterly data are at seasonally adjusted annual rates. Exceptions noted.
1976
1977
1978
Q3
01
Q4
02
Q3
PERSONAL INCOME AND SAVING
1 Total personal income
2 Wage and salary disbursements
3
Commodity-producing industries
4
Manufacturing
5
Distributive industries
6
Service industries
7
Government and government enterprises
8
9
10
11
12
13
14
15
16
Other labor income
Proprietors' income 1
Business and professional 1
Farm 1
Rental income of persons 2
Dividends
Personal interest income
Transfer payments
Old-age survivors, disability, and health
insurance benefits
17
1,381.6
1,531.6
1,717.4
1,742.5
1,803.1
1,852.6
1,892.5
1,946.6
890.0
307.2
237.4
216.3
178.5
188.0
984.0
343.1
266.0
239.1
200.5
201.3
1,103.3
387.4
298.3
269.4
228.7
217.8
1,116.8
393.7
300.8
272.5
231.9
218.7
1,154.3
408.6
312.7
281.6
239.4
224.7
1,189.3
423.0
324.8
291.1
247.2
228.0
1,212.4
431.7
328.5
295.8
252.8
232.1
1,238.1
438.3
331.9
304.0
261.3
234.5
106.5
108.2
116.0
129.0
94.8
34.2
27.3
51.5
181.0
237.3
120.3
129.3
95.5
33.7
26.8
52.3
187.6
243.6
124.9
130.3
99.4
30.9
26.6
52.8
194.4
260.8
123.8
127.1
138.7
77.4
89.3
71.0
18.3
22.1
37.5
127.0
193.8
100.2
116.8
80.5
19.6
24.7
42.1
141.7
208.4
89.1
27.7
25.9
47.2
163.3
224.1
26.8
47.8
167.2
228.3
111.9
125.7
94.4
31.3
27.1
49.7
174.3
231.8
92.9
105.0
116.3
119.8
121.5
91.8
LESS: Personal contributions for social
18 EQUALS: Personal income
LESS: Personal tax and nontax payments
20 EQUALS: Disposable personal income
21
26.1
55.6
insurance
19
117.4
91.3
LESS: Personal outlays
22 EQUALS: Personal saving
61.3
69.6
70.2
71.8
78.7
79.8
81.2
,381.6
1,531.6
1,717.4
1,742.5
1,803.1
1,852.6
1,892.5
1.946.6
197.1
226.4
259.0
266.0
278.2
280.4
290.7
306.6
,184.5
1.305.1
1,458.4
1.476.5
1,524.8
1,572.2
1.601.7
1,640.0
,115.9
1.240.2
1,386.4
1.405.6
1,453.4
1,493.0
1.515.8
1.569.7
68.6
65.0
72.0
70.9
71.5
79.2
85.9
70.3
5,916
3,813
4,144
5.8
6,181
6,402
4,121
4,449
4.9
6,433
4,138
4,462
4.8
6,506
4,197
4,522
4.7
6,514
4,197
4,536
5.0
6,459
4,155
4,510
5.4
6,494
4,195
4,501
4.3
324.9
330.4
336.1
345.2
68.6
25.5
-14.6
65.0
35.2
-15.2
72.0
36.0
-25.2
70.9
40.0
-23.0
71.5
40.1
-28.8
79.2
36.1
-39.9
85.9
35.6
-36.6
70.3
34.0
-44.0
111.6
66.1
121.3
74.1
132.9
84.0
134.3
85.2
136.8
87.7
139.9
89.9
145.1
93.9
150.4
97.5
-35.7
-53.6
17.9
-19.5
-46.3
26.8
-.3
-27.7
27.4
-2.3
-20.4
22.7
10.8
-16.3
27.1
15.8
-11.7
27.6
12.7
-7.0
19.7
14.0
-11.3
25.3
242.3
243.0
283.6
303.3
-19.6
327.9
351.5
-23.5
336.5
356.2
-19.6
351.0
370.5
-19.4
-11.0
362.8
373.8
373.1
395.4
-22.3
375.6
392.3
-16.7
7.5
3.3
3.9
4.1
MEMO:
Per capita (1972 dollars)
23
Gross national product
24
Personal consumption expenditures
25
Disposable personal income
26 Saving rate (percent)
3,974
4,285
5.0
GROSS SAVING
27 Gross private saving
28 Personal saving
29 Undistributed corporate profits 1
30 Corporate inventory valuation adjustment
Capital consumption
allowances
31 Corporate
32 Noncorporate
33 Wage accruals less disbursements
34 Government surplus, or deficit ( - ) , national
income and produce accounts
35
Federal
36
State and local
37 Capital grants received by the United States, net
38 Investment
39
Gross private domestic
40
Net foreign
-.1
41 Statistical discrepancy
1. With inventory valuation and capital consumption adjustments.
2. With capital consumption adjustment.
SOURCE. Survey of Current Business (Department of Commerce).
A53
A54
3.10
International Statistics • February 1980
U.S. INTERNATIONAL TRANSACTIONS
Summary
Millions of dollars; quarterly data are seasonally adjusted except as noted.1
Item credits or debits
1977
1976
1978
03
1 Balance on current account
2
Not seasonally adjusted
Merchandise trade balance 2
Merchandise exports
Merchandise imports
Military transactions, net
Investment income, net 3
Other service transactions, net
Memo: Balance on goods and services 3 - 4
4,605
-14,092
-13,478
01
04
02
03
-3,164
-5,892
85
1,120
415
1,731
-1,056
762
-3,080
-182
-9,306
114,745
-124,051
674
15,975
2,260
9,603
-30,873
120,816
-151,689
1,679
17,989
1,783
-9,423
-33,770
142,052
-175,822
492
21,645
3,241
-8,392
-7,949
36,532
-44,481
247
4,952
819
-1,931
-5,971
39,412
-45,383
-239
6,599
1,010
1,399
-6,115
41,348
-47,463
34
6,864
954
1,737
-7,716
42,792
-50,508
-217
7,465
775
307
-7,282
47,337
-54,619
-384
8,794
1,008
2,136
-1,851
-3,146
-1,895
-2,775
-1,934
-3,152
-463
-770
-524
-790
-517
-805
-466
-897
-504
-870
12 Change in U.S. government assets, other than official reserve
assets, net (increase, - )
-4,214
-3,693
-4,656
-1,390
-994
-1,094
-1,001
-756
13 Change in U.S. official reserve assets (increase, - )
14
Gold
15
Special drawing rights (SDR)
16
Reserve position in International Monetary Fund
17
Foreign currencies
-2,558
0
-78
-2,212
-268
-375
-118
-121
-294
158
732
-65
1,249
4,231
-4,683
115
-3,585
343
2,779
-43
195
-37
182
-65
1,412
3,275
-4,440
-1,142
-2,357
6
-78
415
-52
2,831
18 Change in U.S. private assets aboard (increase, - ) 3
19
Bank-reported claims
20
Nonbank-reported claims
21
U.S. purchase of foreign securities, net
22
U.S. direct investments abroad, net 3
-44,498
-21,368
-2,296
-8,885
-11,949
-31,725
-11,427
-1,940
-5,460
-12,898
-57,033
-33,023
-3,853
-3,487
-16,670
-8,774
-5,488
-29
-475
-2,782
-29,442
-21,980
-1,898
-918
-4,646
-2,958
6,572
-2,719
-1,056
-5,755
-15,507
-8,266
668
-629
-7,280
-25,348
-15,956
n.a.
-2,111
-7,281
23 Change in foreign official assets in the United States
(increase, + )
24
U.S. Treasury securities
25
Other U.S. government obligations
26
Other U.S. government liabilities 5
27
Other U.S. liabilities reported by U.S. banks
28
Other foreign official assets 6
17,573
9,319
573
4,507
969
2,205
36,656
30,230
2,308
1,240
773
2,105
33,758
23,542
656
2,754
5,411
1,395
4,641
3,029
443
122
963
84
18,764
13,422
-115
2,045
3,156
256
-9,391
-8,872
-5
-164
-563
213
-10,043
-12,859
94
257
2,321
145
5,562
5,030
335
191
29 Change in foreign private assets in the United States
(increase, + )
30
U.S. bank-reported liabilities
31
U.S. nonbank-reported liabilities
32
Foreign private purchases of U.S. Treasury securities, net ...
33
Foreign purchases of other U.S. securities, net
34
Foreign direct investments in the United States, net 3
18,826
10,990
-578
2,783
1,284
4,347
14,167
6,719
473
534
2,713
3,728
29,956
16,975
1,640
2,180
2,867
6,294
10,717
7,958
1,004
-1,053
528
2,280
10,475
7,556
-177
1,549
540
1,008
10,868
7,157
-651
2,583
790
989
16,100
12,067
1,086
-239
17,497
13,009
n.a.
1,579
591
2,317
0
10,265
0
-937
0
10,722
0
0
-2,145
-2,716
930
1,301
1,139
4,606
985
10,265
-937
10,722
571
-2,558
13,066
-375
35,416
732
31,004
115
4,519
182
16,719
-3,585
-9,227
343
-10,299
2,779
5,371
9,581
6,351
-727
-1,794
1,803
-1,916
151
1,488
373
204
259
69
63
31
48
85
3
4
5
6
7
8
9
10
11
Remittances, pensions, and other transfers
U.S. government grants (excluding military)
35 Allocation of SDRs
36 Discrepancy
37
Owing to seasonal adjustments
38
Statistical discrepancy in recorded data before seasonal
adjustment
0
0
-86
0
1,161
2,025
0
0
-100
106
0
0
11,163
737
-495
-3,756
3,261
MEMO:
Changes in offical assets
39
U.S. official reserve assets (increase, - )
40
Foreign offical assets in the United States (increase, + )
41 Change in Organization of Petroleum Exporting Countries
offical assets in the United States (part of line 25 above) .
42 Transfers under military grant programs (excluded from lines
4, 6, and 11 above)
1. Seasonal factors are no longer calculated for lines 13 through 42.
2. Data are on an international accounts (IA) basis. Differs from the census
basis primarily because the IA basis includes imports into the U.S. Virgin Islands,
and it excludes military exports, which are part of line 6.
3. Includes reinvested earnings of incorporated affiliates.
4. Differs from the definition of "net exports of goods and services" in the
national income and product ( G N P ) account. The G N P definition makes
various adjustments to merchandise trade and service transactions.
5. Primarily associated with military sales contracts and other transactions arranged with or through foreign official agencies.
6. Consists of investments in U.S. corporate stocks and in debt securities of
private corporations and state and local governments.
Note. Data are from Bureau of Economic Analysis, Survey of Current
(U.S. Department of Commerce).
Business
Trade and Reserve Assets
3.11
A55
U.S. FOREIGN T R A D E
Millions of dollars; monthly data are seasonally adjusted.
1979
Item
1977
1979
1978'
June
1
EXPORTS of domestic and foreign
merchandise excluding grant-aid
shipments
2
GENERAL IMPORTS including merchandise for immediate consumption plus entries into bonded
warehouses
3
Trade balance
121,150
143,578
181,637
15,669
Aug.
15,821
Sept.
15,832
Oct.
16,838
Nov.
17,004
Dec.
16,792
147,685
171,978
206,326
16,937
16,777
18,177
18,666
18,856
18,422
19,870
-26,535
-23,400
-24,690
-1,900
-1,108
-2,357
-2,833
-2,018
-1,418
-3,078
NOTE. Bureau of Census data reported on a free-alongside-ship (f.a.s.) value
basis. Effective January 1978, major changes were made in coverage, reporting,
and compiling procedures. The international-accounts-basis data adjust the Census
basis data for reasons of coverage and timing. On the export side, the largest
adjustments are: (a) the addition of exports to Canada not covered in Census
statistics, and (b) the exclusion of military exports (which are combined with other
military transactions and are reported separately in the "service account").
3.12
15,038
July
On the import side, the largest single adjustment is the addition of imports into
the Virgin Islands (largely oil for a refinery on St. Croix), which are not included
in Census statistics.
SOURCE. FT 900 "Summary of U.S. Export and Import Merchandise Trade"
(U.S. Department of Commerce, Bureau of the Census).
U.S. R E S E R V E ASSETS
Millions of dollars, end of period
1979
Type
1976
1977
1978
July
1 Total 1
Aug.
Sept.
Oct.
Nov.
Dec.
Jan .P
18,747
19,312
18,650
20,023
20,023
18,534
17,994
19,261
18,928 r
20,962
2
Gold stock, including exchange Stabilization Fund 1
11,598
11,719
11,671
11,290
11,259
11,228
11,194
11,112
11,172
11,172
3
Special drawing rights 2 3
2,395
2,629
1,558
2,690
2,689
2,725
2,659
2,705
2,724
3,871
4
Reserve position in International Monetary Fund 2
4,434
4,946
1,047
1,200
1,277
1,280
1,238
1,322
1,253
1,251
5
Foreign Currencies 4
320
18
4,374
4,843
4,798
3,301
2,903
4,122
3,779
4,668
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
3.22
2. Beginning July 1974, the IMF adopted a technique for valuing the SDR based
on a weighed average of exchange rates for the currencies of 16 member countries.
The U.S. SDR holdings and reserve position in the IMF also are valued on this
basis beginning July 1974.
3. Includes allocations by the International Monetary Fund of SDRs as follows:
$867 million on Jan. 1, 1970; $717 million on Jan. 1, 1971; $710 million on Jan.
1, 1972; and $1,139 million on Jan. 1, 1979; plus net transactions in SDRs.
4. Beginning November 1978, valued at current market exchange rates.
A56
3.13
International Statistics • February 1980
FOREIGN B R A N C H E S OF U.S. B A N K S
Balance Sheet Data
Millions of dollars, end of period
1979
Asset account
1977
1976
19781
May
June
July
Aug.
Sept.
Oct.
NOV.P
All foreign countries
1 Total, all currencies
2 Claims on United States
3
Parent bank
4
Other
5 Claims on foreigners
6
Other branches of parent bank
7
Banks
8
Public borrowers 2
9
Nonbank foreigners
10 Other assets
11 Total payable in U.S. dollars
12 Claims on United States
13
Parent bank
14
Other
15 Claims on foreigners
16
Other branches of parent bank
17
Banks
18
Public borrowers 2
19
Nonbank foreigners
20 Other assets
219,420
258,897
306,795
311,334
327,012
326,545
350,441
358,320
365,767
7,889
4,323
3,566
11,623
7,806
3,817
17,340
12,811
4,529
24,624
18,014
6,610
29,293
22,641
6,652
26,605
19,734
6,871
41,917
35,203
6,714
37,685
29,931
7,754
34,880
28,046
6,834
37,836
31,133
6,703
204,486
45,955
83,765
10,613
64,153
238,848
55,772
91,883
14,634
76,560
278,135
70,338
103,111
23,737
80,949
274,384
65,967
103,329
24,691
80,397
284,595
69,608
107,673
24,835
82,479
286,590
70,124
107,957
24,580
83,929
295,011'
74,749
111,190'
25,132'
83,940'
309,004'
80,106'
117,994'
25,777'
85,127'
309,652
80,126
119,253
25,288
84,985
313,358
79,576
121,954
24,845
86,983
360,716'
7,045
8,425
11,320
12,326
13,124
13,350
13,788
14,573
167,695
193,764
224,940
228,587
238,298
234,445
259,035
263,557
263,094
266,724
7,595
4,264
3,332
11,049
7,692
3,357
16,382
12,625
3,757
23,676
17,832
5,844
28,223
22,387
5,836
25,536
19,478
6,058
40,799
34,939
5,860
36,454
29,700
6,754
33,638
27,674
5,964
36,592
30,652
5,940
156,896
37,909
66,331
9,022
43,634
178,896
44,256
70,786
12,632
51,222
203,498
55,408
78,686
19,567
49,837
198,717
50,790
79,089
20,816
48,022
203,729
53,136
81,392
20,553
48,648
202,426
53,629
79,951
20,188
48,658
211,663
58,255
83,466 r
20,988'
48,954
220,665
62,058
88,882'
21,439'
48,286
222,543
61,918
90,911
20,909
48,805
223,150
60,897
92,680
20,437
49,136
3,204
3,820
5,060
6,194
6,346
6,483
13,513'
14,027'
6,573
6,438
6,913
6,982
United Kingdom
21 Total, all currencies
22 Claims on United States
23
Parent bank
24
Other
25 Claims on foreigners
26
Other branches of parent bank
27
Banks
28
Public borrowers 2
29
Nonbank foreigners
30 Other assets
31 Total payable in U.S. dollars
32 Claims on United States
33
Parent bank
34
Other
35 Claims on foreigners
36
Other branches of parent bank
37
Banks
38
Public borrowers 2
39
Nonbank foreigners
40 Other assets
81,466
90,933
106,593
104,915
112,881
115,217
120,703
126,018
127,949
132,139
3,354
2,376
978
4,341
3,518
823
5,370
4,448
922
6,303
4,410
1,893
7,492
5,495
1,997
8,408
6,177
2,231
10,559
8,520
2,039
10,614
8,322
2,292
11,653
9,643
2,010
11,841
9,892
1,949
75,859
19,753
38,089
1,274
16,743
84,016
23,017
39,899
2,206
19,895
98,137
27,830
45,013
4,522
20,772
95,266
25,248
43,657
4,579
21,782
101,693
29,158
44,800
4,872
22,863
103,033
28,376
46,291
4,489
23,877
106,394
31,800
46,625
4,639
23,330
111,598
32,998
49,938
4,882
23,780
112,450
32,464
51,466
4,646
23,874
115,836
33,487
52,760
4,868
24,721
2,253
2,576
3,086
3,346
3,696
3,776
3,750
3,806
3,846
4,462
61,587
66,635
75,860
73,480
78,155
79,211
85,380
88,959
91,485
93,682
3,375
2,374
902
4,100
3,431
669
5,113
4,386
727
5,981
4,374
1,607
7,033
5,386
1,647
7,956
6,060
1,896
10,146
8,443
1,703
10,096
8,270
1,826
11,164
9,485
1,679
11,352
9,697
1,655
57,488
17,249
28,983
846
10,410
61,408
18,947
28,530
1,669
12,263
69,416
22,838
31,482
3,317
11,779
65,968
20,505
30,211
3,331
11,921
65,451
23,999
29,803
3,396
12,253
69,496
23,481
30,626
3,166
12,223
73,503
26,983
31,318
3,210
11,992
77,145
26,631
34,276
3,336
11,902
78,428
27,092
36,183
3,206
11,947
80,307
27,993
36,784
3,311
12,219
824
1,126
1,331
1,531
1,671
1,759
1,731
1,718
1,893
2,023
Bahamas and Caymans
41 Total, all currencies
42 Claims on United States
43
Parent block
44
Other
45 Claims on foreigners
46
Other branches of parent bank
47
Banks
48
Public borrowers 2
49
Nonbank foreigners
50 Other assets
51 Total payable in U.S. dollars
For notes see opposite page.
66,774
79,052
91,735
98,057
103,387
98,839
113,512
109,925
106,484
108,872
3,508
1,141
2,367
5,782
3,051
2,731
9,635
6,429
3,206
16,360
12,244
4,116
20,001
15,956
4,045
16,613
12,566
4,047
29,021
24,929
4,092
24,731
19,919
4,812
21,394
17,131
4,263
24,086
19,868
4,218
62,048
8,144
25,354
7,105
21,445
71,671
11,120
27,939
9,109
23,503
79,774
12,904
33,677
11,514
21,679
78,869
11,886
34,063
12,703
20,217
80,579
11,295
36,542
12,445
20,297
79,476
11,760
35,053
12,301
20,362
81,370
10,745
37,261'
12,619'
20,745
82,296
10,834
38,425'
12,757'
20,280
82,086
10,514
38,820
12,355
20,379
81,728
9,354
39,820
11,935
20,619
1,217
1,599
2,326
2,828
2,807
2,750
3,121
2,898
3,022
3,058
62,705
73,987
85,417
91,829
96,995
92,216
106,767
103,034
99,715
101,932
Overseas Branches
3.13
A57
Continued
1979
1976
Liability account
1977
19781
May
June
July
Aug.
Sept.
Oct.
No
\.P
All foreign countries
219,420
258,897
306,795
311,334
327,012
326,545
350,441
360,716 r
358,320
365,767
53 To United States
54
Parent bank
55
Other banks in United States
56
Nonbanks
32,719
19,773
44,154
24,542
57,948
28,464
12,338
17,146
57,620
23,343
9,884
24,393
61,064
19,355
15,008
26,701
60,097
20,256
12,436
27,405
67,744
20,242
17,785
29,717
67,558
21,420
18,617r
27,521 r
66,034
21,352
14,740
29,942
62,377
19,472
13,855
29,050
57 To foreigners
58
Other branches of parent bank
59
Banks
60
Official institutions
61
Nonbank foreigners
179,954
44,370
83,880
25,829
25,877
206,579
53,244
94,140
28,110
31,085
238,912
67,496
97,711
31,936
41,769
242,513
63,731
101,936
34,107
42,739
254,050
66,631
109,295
34,303
43,821
253,785
67,961
105,296
35,363
45,165
270,328
72,977
117,794
33,511
46,046
280,246 r
78,345 r
118,250r
35,722 r
47,929
279,229
78,068
116,076
35,920
49,165
289,492
77,170
128,024
34,958
49,340
52 Total, all currencies
6,747
73 Other liabilities
11,898
12,663
12,369
12,912
13,057
13,898
232,515
243,521
240,452
264,339
269,738 '
268,769
272,346
42,881
24,213
55,811
27,393
12,084
16,334
55,488
22,406
9,651
23,431
58,524
18,333
14,711
25,480
57,455
19,218
12,130
26,107
65,126
19,192
17,345
28,589
64,921
20,254
18,162 r
26,505'
63,444
20,124
14,402
28,918
60,069
18,269
13,656
28,144
151,363
43,268
64,872
23,972
19,251
169,927
53,396
63,000
26,404
27,127
170,847
49,442
65,404
28,310
27,691
178,631
51,101
71,041
28,117
28,372
176,613
52,048
65,945
29,497
29,123
192,481
56,840
78,006
27,468
30,167
197,890
60,588
76,443'
29,486'
31,373
198,291
60,476
74,869
29,653
33,293
204,684
59,429
83,605
28,521
33,129
3,527
68 To foreigners
69
Other branches of parent bank
70
Banks
71
Official institutions
72
Nonbank foreigners
11,201
230,810
137,612
37,098
60,619
22,878
17,017
64 To United States
65
Parent bank
66
Other banks in United States
67
Nonbanks
9,935
198,572
31,932
19,599
63 Total payable in U.S. dollars
8,163
173,071
62 Other liabilities
4,328
5,072
6,180
6,366
6,384
6,732
6,927 r
7,034
7,593
127,949
132,139
19,731
2,258
8,031
9,442
19,792
2,696
7,381
9,715
103,092
13,139
44,458
24,437
21,058
106,766
12,463
49,299
23,060
21,944
United Kingdom
81,466
75 To United States
76
Parent bank
77
Other banks in Untied States
78
Nonbanks
.
v
79 To foreigners
80
Other branches of parent bank
81
Banks
82
Official institutions
83
Nonbank foreigners
106,593
104,915
112,881
115,217
120,703
7,753
1,451
6 302
9,730
1,887
4,232
3,611
11,697
2,113
3,360
6,224
12,779
1,505
4,245
7,029
13,626
1,706
4,822
7,098
17,174
2,669
6,155
8,350
80,736
9,376
37,893
18,318
15,149
93,202
12,786
39,917
20,963
19,536
88,796
10,931
38,417
21,312
18,136
95,385
11,353
42,297
23,140
18,595
96,258
11,193
41,336
24,017
19,712
98,557
11,507
46,256
21,825
18,969
126,018
18,451
2,079
7,790 r
8,582 '
102,520
13,045
45,346
24,015
20,114
2,241
95 Other liabilities
4,422
4,717
5,333
4,972
5,047
5,126
5,581
77,030
74,127
79,256
80,398
86,642
90,609
92,817
95,163
5,849
1,182
4 667
7,480
1,416
6 064
9,328
1,836
4,144
3,348
11,200
2,047
3,301
5,852
12,199
1,460
4,174
6,565
13,077
1,637
4,757
6,683
16,572
2,613
6,068
7,891
17,817
1,975
7,715 r
8,127 r
19,188
2,196
7,967
9,025
19,318
2,647
7,338
9,333
58,977
7,505
25,608
15,482
10,382
66,216
9,635
25,287
17,091
14,203
60,948
7,777
22,684
17,486
13,001
65,081
7,711
25,436
19.093
12,841
65,403
7,377
23,893
20,288
13,845
68,035
7,720
28,698
18,119
13,498
70,717
8,663
27,284
20,257
14,513
71,560
8,955
26,149
20,457
15,999
73,542
8,337
29,424
19,139
16,642
953
90 To foreigners
91
Other branches of parent bank
92
Banks
93 Official institutions
94
Nonbank foreigners
3,661
67,573
56,372
5,874
25,527
15,423
9,547
)
)
2,445
63,174
84 Other liabilities
85 Total payable in U.S. dollars
86 To United States
87
Parent bank
88
Other banks in United States
89 Nonbanks
90,933
5,997
1,198
4 JGG
73,228
7,092
36,259
17,273
12,605
74 Total, all currencies
1,116
1,486
1,979
1,976
1,918
2,035
2,075
2,069
2,303
Bahamas and Caymans
66,774
96 Total, all currencies
97 To United States
98 Parent bank
99 Other banks in United States
100 Nonbanks
101 To foreigners
102 Other branches of parent bank
103 Banks
104 Official institutions
105 Nonbank foreigners
106 Other liabilities
107 Total payable in U.S. dollars
I.
F
79,052
91,735
98,057
103,387
98,839
113,512
109,925
106,484
108,872
22,721
16,161
A c^n
D,DOU
32,176
20,956
11 220
39,431
20,356
6,199
12,876
38,713
15,957
5,404
17,352
40,023
12,276
8,973
18,774
37,939
12,232
6,342
19,365
41,734
11,117
10,192
20,425
40,582
13,525
8,947
18,110
38,294
12,864
5,757
19,673
35,013
10,955
5,503
18,555
42,899
13,801
21,760
3,573
3,765
45,292
12,816
24,717
3,000
4,759
50,447
16,094
23,104
4,208
7,041
57,184
15,997
28,599
4,970
7,618
61,216
17,104
31,662
4,074
8,376
58,724
18,223
28,204
4,375
7,922
69,373
20,246
35,121
4,751
9,255
67,017
20,730
32,799
4,418
9,070
65,920
19,304
32,266
4,712
9,638
71,271
21,060
36,498
5,176
8,537
1,154
1,584
1,857
2,160
2,148
2,176
2,405
2,326
2,270
2,588
63,417
74,463
87,014
92,797
97,993
93,470
107,623
104,113
100,820
103,339
1. In May 1978 the exemption level for branches required to report was increased, which reduced the number of reporting branches.
2. In May 1978 a broader category of claims on foreign public bor-
rowers, including corporations that are majority owned by foreign governments,
replaced the previous, more narrowly defined claims on foreign official institutions.
A58
3.14
International Statistics • February 1980
SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS
Millions of dollars, end of period
1979
1976
Item
1977
1978
June'
1 Total1
2
3
4
5
6
7
8
9
10
11
12
Aug. r
Sept. r
Oct.
NOV.p
Dec .P
95,634
By area
Western Europe 1
Canada
Latin America and Caribbean
Asia
Africa
Other countries 6
131,097
162,567
144,223
148,017
148,726
149,780
146,728
141,298
148,821
17,231
37,725
18,003
47,820
23,274
67,671
25,535
46,304
25,809
49,425
25,398
50,146
25,619
50,842
24,951
49,411
26,635
43,921
29,843
47,668
11,788
20,648
8,242
32,164
20,443
12,667
35,912
20,970
14,740
36,458
20,697
15,229
37,490
19,797
15,496
38,005
19,547
15,630
38,106
19,547
15,666
38,162
18,497
15,707
37,125
17,837
15,780
37,672
17,387
16,251
45,882
3,406
4,926
37,767
1,893
1,760
By type
Liabilities reported by banks in the United States2
U.S. Treasury bills and certificates 3
U.S. Treasury bonds and notes
Marketable
Nonmarketable 4
U.S. securities other than U.S. Treasury securities5
70,748
2,334
4,649
50,693
1,742
931
92,989
2,506
5,045
58,858
2,423
746
83,553
1,979
4,610
50,767
2,597
717
86,668
2,116
5,397
50,537
2,613
686
86,485
2,185
4,497
51,928
3,219
412
87,117
2,412
4,890
52,414
2,513
434
85,467
1,954
4,559
51,782
2,583
383
80,838
1,971
4,579
51,143
2,215
552
85,502
1,898
6,322
52,205
2,412
482
1. Includes the Bank for International Settlements.
2. Principally demand deposits, time deposits, bankers acceptance, 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.
3.15
July r
5. Debt securities of U.S. government corporations and federally sponsored
agencies, and U.S. corporate stocks and bonds.
6. Includes countries in Oceania and Eastern Europe.
NOTE: 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.
LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Banks in the United States
Payable in Foreign Currencies
Millions of dollars, end of period
1978
Item
1976
Sept.
1 Banks' own liabilities
2 Banks' own claims1
3
Deposits
4
Other claims
5 Claims of banks' domestic customers 2
781
1,834
1,103
731
1. Includes claims of banks' domestic customers through March 1978.
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
their domestic customeers.
1979
1977
925
2,356
941
1,415
1,771
2,950
1,375
1,575
446
Dec.
2,235 r
3,504
1,633 r
1,871
367
Mar.
1,781
2,602
1,121
1,481
476
June
1,963
2,519 r
1,324 r
1,196'
520
Sept.
2,323
2,607
1,228
1,379
612
NOTE: Data on claims exclude foreign currencies held by U.S. monetary authorities.
Nonbank-Reported
3.16
LIABILITIES TO FOREIGNERS
Payable in U.S. dollars
Data
A59
Reported by Banks in the United States
Millions of dollars, end of period
1979
Holder and type of liability
1978
June'
1 All foreigners
2 Banks' own liabilities
3
Demand deposits
4
Time deposits 1
5
Other 2
6
Own foreign offices 3
7 Banks' custody liabilities 4
8
U.S. Treasury bills and certificates 5
9
Other negotiable and readily transferable
instruments 6
10
Other
11 Nonmonetary international and regional
organizations 7
12 Banks' own liabilities
13
Demand deposits
14
Time deposits 1
15
Other 2
21 Banks' own liabilities
22
Demand deposits
23
Time deposits 1
24
Other 2
30 Banks' own liabilities
31
Unaffiliated foreign banks
32
Demand deposits
33
Time deposits 1
34
Other 2
35
40 Other foreigners
41 Banks' own liabilities
42
Demand deposits
43
Time deposits
44
Other 2
Nov.?
Dec .P
168,082
168,992
191,719
185,695
180,656
184,259
186,958
16,803
11,347
18,996
11,521
100,054
19,326
12,666
12,712
55,350
97,262
19,084
12,577
12,967
52,635
117,880
18,910
12,747
12,627
73,595
111,716
20,163
13,048
12,694
65,811
107,873
17,898
12,260
12,774
64,941
117,075
23,332
12,556
12,619
68,568
116,817
23,348
13,383
16,032
64,053
40,744
48,906
88,093'
68,202
68,028
47,545
71,730
51,467
73,839
52,258
73,978
52,429
72,783
50,452
67,184
45,005
70,141
48,575
17,396
2,495'
18,186
2,298
18,047
2,216
19,297
2,284
19,312
2,237
20,141
2,190
19,802
2,376
19,204
2,362
3,274
2,607'
2,977
3,437
3,479
2,909
2,389
2,730
2,441
231
139
906'
330
84'
492
1,508
264
94
1,150
844
216
69
559
603
154
77
372
491
161
82
248
566
143
82
342
766
214
80
472
710
260
152
298
1,701
201
1,469
318
2,593
1,345
2,876
1,442
2,418
912
1,823
327
1,964
258
1,732
102
1,499
1
1,151
1
1,247
1
1,433
1
1,505
1
1,494
2
1,605
101
1,627
2
5,714
290
205
90,650'
71,840
75,235
75,545
76,460
74,362
70,556
77,512
3,528
1,797
12,073'
3,390
2,531'
6,152'
13,490
3,196
2,491
7,803
14,382
2,850
2,575
8,957
12,945
2,397
2,392
8,155
13,488
3,139
2,320
8,029
11,981
2,372
1,859
7,749
14,168
5,652
1,850
6,666
17,728
4,722
2,735
10,270
58,350
46,304
60,853
49,425
62,600
50,146
62,972
50,842
62,381
49,411
56,388
43,921
59,784
47,668
10,992
170
3,394
2,321
65,822
78,577
67,415
54,956
12,006
40
11,377
50
12,402
52
12,080
51
12,913
57
12,411
56
12,064
52
76,310
73,085
95,469
88,947
86,(55
92,709
88,570
71,211
15,861
11,138
1,372
3,351
68,134
15,499
11,357
1,197
2,945
90,448
16,853
11,757
1,525
3,571
83,800
17,989
12,425
1,752
3,813
81,055
16,114
10,603
1,551
3,960
87,504
18,936
12,872
1,627
4,437
83,463
19,409
13,252
1,736
4,421
55,350
52,635
73,595
65,811
64,941
68,568
64,053
4,785
300
5,099
407
4,951
347
5,020
384
5,147
406
5,100
400
5,205
451
5,108
422
2,425
2,060
9,104
2,297
57,720'
52,935'
15,372'
11,239
1,468'
2,664'
37,563'
37,174
2,547
2,145
2,556
2,048
2,509
2,127
2,625
2,116
2,684
2,017
2,611
2,143
2,514
2,172
14,736
16,020'
16,955
17,235
17,227
17,379
17,750
18,263
18,434
4,304
7,546
12,990'
4,242
8,353
394'
13,845
4,729
8,708
409
13,901
4,661
8,735
505
13,884
4,602
8,753
529
13,937
4,439
8,894
604
14,271
4,779
8,769
724
14,637
4,594
8,999
1,044
14,917
5,114
8,760
1,043
3,030
285
3,110
516
3,333
350
3,343
285
3,442
269
3,479
315
3,626
375
3,517
382
2,481'
264
2,482
112
2,867
117
2,953
105
3,103
70
3,050
114
3,175
76
2,999
137
10,633
10,732
11,099
11,264
11,346
10,821
10,848
42,335
10,933
2,040
119
12,814
4,015
6,524
141
45 Banks'custody liabilites 4
46
U.S. Treasury bills and certificates
47
Other negotiable and readily transferable
instruments 6
48
Other
49 MEMO: Negotiable time certificates of deposit
in custody for foreigners
1. Excludes negotiable time certificates of deposit, which are included in "Other
negotiable and readily transferable instruments." Data for time deposits prior to
April 1978 represent short-term only.
2. Includes borrowing under repurchase agreements.
3. U.S. banks: includes amounts due to own foreign branches and foreign subsidiaries consolidated in "Consolidated Report of Condition" filed with bank regulatory agencies. Agencies, branches, and majority-owned subsidiaries of foreign
banks: principally amounts due to head office or parent foreign bank, and foreign
branches, agencies or wholly owned subsidiaries of head office or parent foreign
bank.
4. Financial claims on residents of the United States, other than long-term
securities, held by or through reporting banks.
Oct.
78,904'
19,201
12,473
9,702'
37,563'
Own foreign offices 3
36 Banks' custody liabilities 4
37
U.S. Treasury and certificates
38
Other negotiable and readily transferable
instruments 6
39
Other
Sept.'
166,997'
25 Banks' custody liabilities 4
26
U.S. Treasury bills and certificates 5
27
Other negotiable and readily transferable
instruments 6
28
Other
29 Banks 9
Aug.'
126,168
110,657
16 Banks' custody liabilities 4
17
U.S. Treasury bills and certificates
18
Other negotiable and readily transferable
instruments 6
19
Other
20 Official institutions 8
July'
11,007
5. Includes nonmarketable certificates of indebtedness (including those payable
in foreign currencies through 1974) and Treasury bills issued to official institutions
of foreign countries.
6. Principally bankers acceptances, commercial paper, and negotiable time certificates of deposit.
7. Principally the International Bank for Reconstruction and Development, and
the Inter-American and Asian Development Banks.
8. Foreign central banks and foreign central governments and the Bank for
International Settlements.
9. Excludes central banks, which are included in "Official institutions."
A60
3.16
International Statistics • February 1980
LIABILITIES TO FOREIGNERS Continued
1979
Area and country
1976
1977
1978
June
July
Aug.
Sept.
Oct.
N
OV.P
Dec .P
1 Total
110,657
126,168
166,997'
168,082'
168,992'
191,719'
185,695
180,656
184,259
186,958
2 Foreign countries
104,943
122,893
164,390'
165,105'
165,555'
188,241'
182,786
178,267
181,528
184,516
47,076
346
2,187
356
416
4,876
6,241
403
3,182
3,003
782
239
559
1,692
9,460
166
10,018
189
2,673
51
236
60,295
318
2,531
770
323
5,269
7,239
603
6,857
2,869
944
273
619
2,712
12,343
130
14,125
232
1,804
98
236
85,382'
513
2,552
1,946
346
9,208
17,286
826
7,674
2,402
1,271
330
870
3,121
18,560'
157
14,265
254
3,393'
82
325
79,509'
449
2,419
1,165
457
9,594
8,492
684
9,658'
2,628
1,348
353
1,211
2,437
15,950'
156
18,005'
151
4,011'
62
277
81,497'
444
2,493
1,560
466
9,616
10,724
760
8,460'
2,355
1,263
303
1,107
2,227
16,687'
193
18,745'
159
3,610'
63
260
86,112'
446
2,714
1,412
508
9,985
10,434
695
9,678'
2,627
1,320
411
1,060
2,368
15,717'
160
22,579
149
3,504
80
265
88,584
444
2,920
1,100
415
10,499
13,129
691
8,551
2,281
1,402
554
1,133
2,062
16,642
135
22,622
142
3,493
52
317
88,008
426
2,710
1,001
334
9,340
13,154
632
8,481
2,174
1,393
620
1,103
2,165
16,643
150
24,138
147
3,087
53
259
87,499
404
2,786
1,166
390
10,301
10,801
792
8,346
2,165
1,407
595
1,184
2,064
17,220
145
24,055
147
3,233
39
261
91,317
413
2,364
1,092
398
10,387
12,935
635
7,778
2,327
1,267
557
1,259
2,005
18,551
119
24,679
266
3,931
52
302
3 Europe
4
Austria
5
Belgium-Luxembourg
6
Denmark
7
Finland
8
France
9
Germany
10 Greece
11 Italy
12 Netherlands
13 Norway
14 Portugal
15 Spain
16 Sweden
17 Switzerland
18 Turkey
19 United Kingdom
20
Yugoslavia
21 Other Western Europe 1
22
U.S.S.R
23 Other Eastern Europe 2
24 Canada
4,659
4,607
6,966
6,674
7,610
8,376
8,319
8,644
7,280
7,357
25 Latin America and Caribbean
26
Argentina
27 Bahamas
28 Bermuda
29 Brazil
30
British West Indies
31 Chile
32 Colombia
33 Cuba
34
Ecuador
35 Guatemala 3
36 Jamaica 3
37 Mexico
38
Netherlands Antilles
39 Panama
40
Peru
41
Uruguay
42 Venezuela
43
Other Latin America and Carribbean
19,132
1,534
2,770
218
1,438
1,877
337
1,021
6
320
23,670
1,416
3,596
321
1,396
3,998
360
1,221
6
330
2,876
196
2,331
287
243
2,929
2,167
44,771'
1,896'
16,458'
402
1,332
8,723'
403
2,402
7
391
319
46
3,392
414
3,148'
382
248
2,982
1,825
41,242'
1,697'
13,107'
339
1,294
7,840'
465
2,292
7
443
319
104
3,632
422
3,070
425
231
3,920
1,636
56,889'
1,761'
24,085
415
1,040
13,367
459
2,378
6
449
320
67
3.658
366'
3.049
391
222
3,180
1,675
49,408
1,935
18,372
392
1,198
11,202
420
2,188
9
364
335
175
3,549
359
3,336
477
217
2,903
1,977
47,097
1,693
15,377
399
994
11,372
425
2,243
7
482
361
113
3,528
609
3,926
388
217
3,168
1,795
51,604
1,573
18,533
404
1,051
12,522
356
2,377
12
476
374
74
3,666
460
4,290
417
185
3,014
1,822
49,313
1,582
15,300
435
1,005
10,807
469
2,617
13
425
2,870
158
1,167
257
245
3,118
1,797
31,606'
1,484
6,752'
428
1,125
5,991
399
1,756
13
322
416
52
3,417
308
2,968'
363
231
3,821
1,760
44 Asia
China
Mainland
Taiwan
Hong Kong
India
Indonesia
Israel
Japan
Korea
Philippines
Thailand
Middle-East oil-exporting countries 4 .
Other Asia
29,766
30,488
36,473'
29,734'
30,818'
32,219'
32,505
30,615
31,061
32,394
48
990
894
638
340
392
14,363
438
628
277
9,360
1,398
53
1,013
1,094
961
410
559
14,616
602
687
264
8,979
1,250
67
502
1,256
790
449
674
21,927
795
644
427
7,529'
1,414
46
739
1,555
940
409
708'
12,572
809
690
413
9,222'
1,632
42
769
1.452
873
509
624'
13,104
816
640
307
9,853'
1,830
41
1.027
1,571
704
317
627'
13,094
825
603'
330
11,306'
1,773
45
1,231
1,634
674
463
626
13,292
938
632
421
10,688
1,862
49
1,339
1,542
496
555
621
10,885
950
598
304
11,313
1,963
45
1.413
1,624
582
478
574
7,867
951
671
415
14,565
1,876
49
1,393
1,667
527
504
663
8,930
995
800
281
14,712
1,873
57 Africa
58 Egypt
59 Morocco
60
South Africa
61
Zaire
62
Oil-exporting countries 5
63 Other Africa
2,298
333
87
141
36
1,116
585
2,535
404
66
174
39
1,155
698
2,886
404
32
168
43
1,525
715
3,237
306
45
316
56
1,566
948
3,226
378
35
196
37
1,699
881
3,818
302
40
174
49
2,441
811
3,194
245
40
235
73
1,832
768
3,141
294
30
194
112
1,711
800
3,105
380
36
213
104
1,513
859
3,230
475
32
184
110
1,627
803
64 Other countries
65
Australia
66
All other
2,012
1,905
107
1,297
1,140
158
1,076
838
239
1,181
891
290
1,162
806
355
826
621
205
776
549
227
762
528
234
979
714
266
906
684
222
67 Nonmonetary international and regional
organizations
International
Latin American regional
Other regional
5,714
5,157
267
290
3,274
2,752
278
245
2,607'
1,485
808
314'
2,977'
1,865'
829
284
3,437
2,257
917
263
3,479
2,427
793
258'
2,909
1,810
824
275
2,389
1,343
755
291
2,730
1,517
790
423
2,441
1,321
813
308
45
46
47
48
49
50
51
52
53
54
55
56
68
69
70
1. Includes the Bank for International Settlements. Beginning April 1978, also
includes Eastern European countries not listed in line 23.
2. Beginning April 1978 comprises Bulgaria, Czechoslovakia, German Democratic Republic, Hungary, Poland, and Romania.
3. Included in "Other Latin America and Caribbean" through March 1978.
A1
41J
4,094
499
4,483
383
202
4,192
2,317
4. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
5. Comprises Algeria, Gabon, Libya, and Nigeria.
6. Asian, African, Middle Eastern, and European regional organizations, except
the Bank for International Settlement, which is included in "Other Western Europe."
Nonbank-Reported
3.17
Data
A61
BANKS' OWN CLAIMS ON FOREIGNERS Reported by Banks in the United States
Payable in U.S. Dollars
Millions of dollars, end of period
1979
Area and country
1976
1977
1978
June
July
Aug.
Sept.
Oct.
NOV.P
Dec .P
1 Total
79,301
90,206
115,307
115,134'
113,502'
125,633'
127,247
121,086'
124,368
134,338
2 Foreign countries
79,261
90,163
115,251'
115,088'
113,455'
125,582'
127,1%
121,049'
124,324
134,306
14,776
63
482
133
199
1,549
509
279
993
315
136
88
745
206
379
249
7,033
234
85
485
613
18,114
65
561
173
172
2,082
644
206
1,334
338
162
175
722
218
564
360
8,964
311
86
413
566
24,230'
140
1,200
254
305
3,742
895'
164
1,508
675'
299
171
1,110
537
1,283
283
10,156
363
122
366
657'
24,370'
151
1,696'
140
186
3,545'
838'
167
1,332
506'
200
172
994
247
1,071
135
11,259'
535
187
300
709'
24,138'
188
1,669'
137
220
3,237'
939'
130
1,196
792
181
235
999
401
1,027
118
10,693'
541
199
282
955'
25,774
223
1,483
141
247
3,260
883'
267
1,474
559
227
297
969
482
714
148
12,347
571
216
292
974'
28,380
191
1,737
166
227
3,766
1,840
194
1,566
631
238
325
1,126
459
1,179
119
12,394
584
247
326
1,064
26,178'
190'
1,559'
116
230
2,736
1,309
282
1,424
618
236
349
1,117
603
1,171
141
11,839'
578
154
349
1,175'
26,044
167
1,420
149
182
3,305
1,409
171
1,262
603
257
352
1,050
548
1,232
151
11,546
582
185
311
1,160
28,354
285
1,327
147
202
3,303
1,168
154
1,591
514
276
333
1,061
542
1,163
149
13,787
611
175
290
1,277
4,367
5,562
3 Europe
4
Austria
5 Belgium-Luxembourg
6 Denmark
7 Finland
8 France
9 Germany
10 Greece
11 Italy
12 Netherlands
13 Norway
14 Portugal
15 Spain
16 Sweden
17 Switzerland
18 Turkey
19 United Kingdom
Yugoslavia
20
21 Other Western Europe 1
22
U.S.S.R
23 Other Eastern Europe 2
3,319
3,355
5,152
4,900'
5,063
5,017
4,787
4,335'
25 Latin America and Caribbean
Argentina
26
27
Bahamas
Bermuda
28
29
Brazil
30
British West Indies
31 Chile
32
Colombia
33 Cuba
34
Ecuador
Guatemala 3
35
36 Jamaica 3
37
Mexico
38 Netherlands Antilles
39
Panama
40
Peru
41
Uruguay
42
Venezuela
43
Other Latin America and Caribbean
38,879
1,192
15,464
150
4,901
5,082
597
675
13
375
45,850
1,478
19,858
232
4,629
6,481
675
671
10
517
57,166
2,281
21,515
184
6,251
9,391
972
1,012
4,822
140
1,372
933
42
1,828
1,293
4,909
224
1,410
962
80
2,318
1,394
705
94
40
5,423
273
3,094
918
52
3,474
1,487
57,131'
3,202'
19,113
128'
6,121
9,001'
1,089
1,089
4
908
95
40
6,428'
280
3,603'
720
58
3,803'
1,447
53,941'
3,341'
16,769'
179'
6,168'
6,244'
1,120
1,196
4
916
98
47
7,172'
392
4,212'
727
56
3,817'
1,483
62,932'
3,259'
19,931
167
6,548
10,723'
1,173
1,220
6
921
100
30
7,699
342
4,400
730
66
4,040'
1,577'
62,465
3,285
19,146
172
7,286
9,176
1,323
1,259
4
943
103
32
8,430
301
4,523
716
60
4,176
1,531
59,225'
3,653
17,393'
485
7,567
6,742'
1,396
1,451
4
1,000
110
29
8,416
230
4,268
607
72
4,349'
1,455
62,080
67,057
4,157
4,225
16,030
18,681
469
458
7,754
7,499
8,913
9,685
1,423
1,348
1,522
1,611
4
6
1,007
1,025
115
136
34 247
8,336
8,925
227
246
5,774
5,983
604
652
71
112
4,392
4,477
1,587
1,600
44
19,204
19,236
25,494'
25,576'
27,217'
28,963'
28,546
28,457'
29,054
30,692
3
1,344
316
69
218
755
11,040
1,978
719
442
1,459
863
10
1,719
543
53
232
584
9,839
2,336
594
633
1,746
947
4
1,499
1,579'
54
143
870
12,686
2,282
680
758
3,135
1,804
9
1,884'
1,863'
82
138
842
12,764'
3,388'
678
895
1,595'
1,437'
35
1,876'
1,978
43
131
865
13,950'
3,469'
743
925
1,807'
1,395'
29
1,970
1,788
75
156
857
15,050'
3,612
793
919
1,689
2,026
25
1,935
1,859
74
140
882
14,656
3,750
638
1,036
1,914
1,637
55
1,930
1,737
68
147
891
14,983'
3,839
724
956
1,190
1,939
31
1,805
1,794
69
138
842
16,149
3,732
642
971
1,107
1,775
86
1,833
1,803
93
131
1,004
16,971
3,795
745
937
1,489
1,805
2,311
126
27
957
112
524
565
2,518
119
43
1,066
98
510
682
2,221
107
82
860
164
452
556
2,128
178
37
745
151
478
539
2,082'
115
34
745
189
491'
508
1,969
126
31
730
151
398
533
2,101
120
23
704
149
563
542
1,926
122
66
602
135
435
566
1,865
91
73
565
135
442
559
1,785
112
103
445
142
391
593
772
597
175
1,090
905
186
988
877
111
984
779
205
1,013
765
248
926
756
170
916
744
172
928
748
180
915
740
175
856
677
179
40
43
56
45
47
51
50
36
44
32
24 Canada
45
46
47
48
49
50
51
52
53
54
55
56
China
Mainland
Taiwan
Hong Kong
India
Indonesia
Israel
Japan
Korea
Philippines
Thailand
Middle East oil-exporting countries 4
Other Asia
57 Africa
58 Egypt
59
Morocco
60
South Africa
61 Zaire
62 Oil-Exporting Countries 5
Other
63
64 Other Countries
65
Australia
66
All other
67 Nonmonetary international and regional
organizations 6
1. Includes the Bank for International Settlements. Beginning April 1978, also
includes Eastern European countries not listed in line 23.
2. Beginning April 1978 comprises Bulgaria, Czechoslavakia, German Democratic Republic, Hungary, Poland, and Romania.
3. Included in "Other Latin America and Caribbean" through March 1978.
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."
NOTE. Data for period prior to April 1978 include claims of banks' domestic
customers on foreigners.
A62
3.18
International Statistics • February 1980
BANKS' OWN AND DOMESTIC CUSTOMERS' CLAIMS ON FOREIGNERS Reported by Banks in the
United States
Payable in U.S. Dollars
Millions of dollars, end of period
1979
Type of claim
1976
1978r
1977
June r
1 Total
Claims of banks' domestic customers 2
Deposits
Negotiable and readily transferable instruments 3 ..
Outstanding collections and other claims 4
9
10
11
12
90,206
Sept.
113,502
11,891
36,213
38,793
6,973
31,820
26,605
125,633
12,510
40,237
45,048
7,549
37,498
27,838
127,247
13,808
39,493
46,010
7,394
38,616
27,935
Oct.'
5,756
129,027
115,134
11,324
37,164
41,489
7,304
34,185
25,157
11,178
480
5,344
5,353
13,893
683
7,312
5,899
16,864
17,326
124,368
13,639
43,546
37,903
5,710
32,193
29,280
134,338
14,911
48,104
40,800
6,276
34,523
30,523
21,615
20,060
19,733'
12,804
Dec.P
18,729'
975'
11,580'
6,174'
14,919
Nov.
121,086
14,103
38,164
39,799
6,745
33,054
29,021
126,485
6,176
13 MEMO: Customer liability on acceptances
Dollar deposits in banks abroad, reported by nonbanking business enterprises in the United
States 5
1. U.S. banks: includes amounts due from own foreign branches and foreign
subsidiaries consolidated in "Consolidated Report of Condition" filed with bank
regulatory agencies. Agencies, branches, and majority-owned subsidiaries of foreign
banks: principally amounts due from head office or parent foreign bank, and
foreign branches, agencies, or wholly owned subsidiaries of head office or parent
foreign bank.
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 account of their
domestic customers.
3. Principally negotiable time certificates of deposit and bankers acceptances.
3.19
Aug.r
115,307
10,130
41,471
40,420
5,458
34,962
23,286
79,301
Banks' own claims on foreigners
Foreign public borrowers
Own foreign offices 1
Unaffiliated foreign banks
Deposits
Other
All other foreigners
2
3
4
5
6
7
8
July'
145,975'
20,537
20,808
18,734
n.a.
4. Data for March 1978 and for period prior to that are outstanding collections
only.
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 July 1979 BULLETIN, p. 550.
NOTE: Beginning April 1978, data for banks' own claims are given on a monthly
basis, but the data for claims of banks' own domestic customers are available on
a quarterly basis only.
BANKS' OWN CLAIMS ON UNAFFILIATED FOREIGNERS Reported by Banks in the United States
Payable in U.S. Dollars
Millions of dollars, end of period
1979
1978
Maturity; by borrower and area
June
1 Total
By borrower
Maturity of 1 year or less1
Foreign public borrowers
All other foreigners
Maturity of over 1 year 1
Foreign public borrowers
All other foreigners
2
3
4
5
6
7
By area
Maturity of 1 year or less1
9
10
11
12
13
14
15
16
17
18
19
Canada
Latin American and Caribbean
Asia
Africa
All other 2
Maturity of over 1 year 1
Europe
Canada
Latin America and Caribbean
Asia
Africa
All other 2
1. Remaining time to maturity.
2. Includes nonmonetary international and regional organizations.
Sept.
Dec.
Mar.
June
Sept.
55,902
60,096
73,632'
71,528
77,662'
87,233
44,558
3,128
41,430
11,343
3,243
8,101
47,230
3,709
43,521
12,866
4,230
8,635
58,363'
4,589'
53,774'
15,269'
5,343'
9,926'
55,363'
4,643'
50,720
16,165'
5,944'
10,221'
60,014'
4,594'
55,420'
17,648'
6,427'
11,221'
67,877
5,949
61,928
19,356
7,637
11,719
9,710
1,598
17,439
13,831
1,457
523
10,513
1,953
18,624
14,014
1,535
591
15,126'
2,670
20,927'
17,575'
1,496
569
12,376
2,512
21,651'
16,993
1,290
541
14,019'
2,703'
23,090'
18,199'
1,438
565
16,754
2,462
25,556
21,182
1,400
523
2,920
344
5,900
1,297
631
252
3,102
794
6,877
1,303
580
211
3,142'
1,426
8,452'
1,399
636
214
3,103'
1,456
9,325'
1,471
629
180
3,484'
1,221
10,265'
1,881'
614
183
3,667
1,371
11,794
1,713
622
189
NOTE. The first available data are for June 1978.
Nonbank-Reported
3.20
Data
A63
C L A I M S O N F O R E I G N C O U N T R I E S Held by U.S. Offices and Foreign Branches of U.S.-Chartered Banks'
Billions of dollars, end of period
1977
Area or Country
1975
1978
1979
1976
Sept.
Dec.
Mar.
June 2
Sept.
Dec.
Mar.
June
Sept.
167.0
207.7
226.7
239.4
247.2
245.7
246.7
265.4
263.6
274.4
293.8
2 G-10 countries and Switzerland
Belgium-Luxembourg
3
4
France
5
Germany
6
Italy
Netherlands
7
8
Sweden
9
Switzerland
10 United Kingdom
11 Canada
12 Japan
88.0
5.3
8.5
7.8
5 2
2.8
1.0
2.4
36.3
3.8
14.9
100.1
6.1
10.0
8.7
5.8
2.8
1.2
3.0
41.5
5.1
15.9
108.8
7.1
10.5
8.6
6.0
3.0
1.9
3.3
44.1
6.6
17.6
115.3
8.4
11.0
9.6
6.5
3.5
1.9
3.3
46.5
5.8
18.8
116.6
8.3
11.4
9.0
6.0
3.4
2.0
4.0
46.5
6.9
19.1
112.8
8.3
11.4
9.1
6.4
3.4
2.1
4.1
45.0
5.1
17.9
113.7
8.4
11.7
9.7
6.0
3.5
2.2
43
44.4
4.9
18.6
124.9
9.0
12.2
11.4
6.6
4.4
2.1
5.4
47.2
5.9
20.7
118.9
9.4
11.7
10.5
5.7
3.8
2.0
4.5
46.5
5.8
19.0
125.0
9.7
12.7
10.8
6.1
4.0
2.0
4.8
50.3
5.5
19.1
135.8'
10.7
12.0
12.9
6.1
4.7
2.3
5.0
53.8'
6.0
22.3
13 Other developed 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
10.7
.7
.6
.9
1.4
1.4
.3
1.9
.6
.6
1.2
1.3
15.1
1.2
1.0
1.1
1.7
1.5
.4
2.8
1.3
.7
2.2
1.2
18.1
1.3
1.5
1.2
2.0
1.8
.6
3.5
1.4
1.2
2.3
1.5
18.6
1.3
1.6
1.2
2.2
L9
.6
3.6
1.5
.9
2.4
1.4
20.5
1.5
1.6
1.2
2.7
1.9
.7
3.6
1.5
1.4
2.5
1.9
19.3
1.5
1.7
1.1
2.3
2.1
.6
3.6
1.4
1.2
2.4
1.4
18.7
1.5
1.9
1.0
2.2
2.\
.5
3.5
1.5
1.0
2.2
L3
19.4
1.7
2.0
1.2
2.3
2.1
.6
3.4
1.5
1.2
2.0
1.4
18.3
1.7
2.0
1.1
2.3
2.1
.6
3.0
1.4
1.1
1.7
1.3
18.4
1.8
2.0
1.1
2.2
2.1
.5
3.0
1.4
1.2
1.8
1.3
19.7
2.0
2.0
1.2
2.3
2.3
.7
3.3
1.4
1.5
1.7
1.3
6.9
.4
2.3
1.6
1.6
1.0
12.6
.7
4.1
2 2
4.2
1.4
16.5
1.1
5.1
2.2
6.3
1.9
17.6
1.1
5.5
2.2
6.9
1.9
19.2
1.3
5.5
2.1
8.3
2.0
19.1
1.4
5.6
1.9
8.3
1.9
20.4
1.6
6.2
1.9
8.7
2.0
22.7
1.6
7.2
2.0
9.4
2.5
22.6
1.5
7.2
1.9
9.4
2.6
22.7
1.6
7.5
1.9
9.1
2.6
23.3
1.6
7.9
1.9
9.1
2.8
31 Non-oil developing countries
34.2
43.1
47.6
50.0
49.9
48.9
49.5
52.4
53.8
56.1
59.2'
32
33
34
35
36
37
38
Latin America
Argentina
Brazil
Chile
Colombia
Mexico
Peru
Other Latin America
1.7
S.O
.5
1.2
9.0
1.4
2.6
1.9
11.1
.8
1.3
11.7
1.8
2.7
2.4
11.8
.8
1.2
12.6
1.9
2.5
2.9
12.7
.9
1.3
11.9
1.9
2.7
3.0
13.0
1.1
1.3
11.2
1.7
3.5
3.0
13.3
1.3
1.3
11.0
1.8
3.3
2.9
14.0
1.3
1.3
10.7
1.8
3.4
3.0
14.9
1.6
1.4
10.8
1.7
3.6
2.9
15.2
1.7
1.5
10.9
1.6
3.5
3.5
15.0
1.8
1.5
11.0
1.4
3.3
4.1
15.1
2.2
1.7
11.6
1.4
3.7
39
40
41
42
43
44
45
46
47
Asia
China
Mainland
Taiwan
India
Israel
Korea (South)
Malaysia4
Philippines
Thailand
Other Asia
*
*
*
1.7
.2
.9
2.4
1.7
.7
.4
2.3
2
L0
3.1
.5
2.2
.7
.4
2.9
.3
.7
3.6
.7
2.4
.9
.4
3.1
.3
.9
3.9
.7
2.5
1.7
.3
2.5
.3
.8
3.7
.6
2.6
1.1
.4
2.4
.2
.7
3.6
.6
2.7
1.1
.3
2.4
.3
.7
3.5
.6
2.8
1.1
.3
2.9
.2
1.0
3.9
.6
2.8
1.2
.2
.1
3.1
.2
1.0
4.2
.6
3.2
1.2
.3
.1
3.3
.2
.9
5.0
.7
3.7
1.4
.4
.1
3.5
.2
1.0
5.3
.7
3.7
1.6
.3
48
49
50
51
Africa
Egypt
Morocco
Zaire
Other Africa 5
.4
.1
.3
.5
.4
.2
2
.6
.4
.4
.3
1.2
.3
.5
.3
1.2
.3
.4
.3
1.4
.3
.5
.2
1.2
.4
.5
.2
1.3
.4
.6
.2
1.4
.4
.6
.2
1.4
.7
.5
.2
1.5
.6'
.5
.2
1.7
52 Eastern Europe
53
U.S.S.R
54
Yugoslavia
55
Other
3.7
1.0
.6
2.1
5.2
1.5
.8
2.8
5.5
1.5
1.0
3.0
6.5
1.6
1.1
3.8
6.3
1.4
1.2
3.7
6.4
1.4
1.3
3.7
6.6
1.4
1.3
3.9
6.9
1.3
1.5
4.1
6.7
1.1
1.6
4.0
6.7
.9
1.7
4.1
7.3
.9
1.8
4.6
19.4
7.3
.5
2.5
.6
2.6
.2
1.6
3.8
.1
26.2
11.8
.5
3.8
.6
2.7
.1
2.3
4.4
25.3
9.9
.5
4.3
.6
2.8
.1
3.1
3.9
.1
26.1
9.8
.6
3.8
.7
3.1
.2
3.7
3.7
.5
29.0
11.3
.6
4.5
.7
3.2
2
4.0
4.0
.5
31.1
11.8
.7
6.3
.6
3.2
.1
4.1
3.8
.5
29.2
11.1
.7
6.2
.6
3.1
.1
4.0
2.9
.5
30.0
9.9
.7
6.9
.8
2.9
.1
4.3
3.9
.5
33.8
12.9
.6
6.7
.8
3.3
.1
4.7
4.2
.5
35.6
13.3
.7
7.2
1.0
3.5
.1
5.2
4.2
.4
37.9
13.0
.7
9.1
1.1
3.0
.2
5.5
4.9
.4
4.1
5.4
5.0
5.3
5.7
8.1
8.6
9.1
9.5
9.9
10.6
1 Total
25 Oil-exporting countries 3
26
Ecuador
27
Venezuela
28
Indonesia
29
Middle East countries
30
African countries
56 Offshore banking centers
57
Bahamas
58
Bermuda
59 Cayman Islands and other British West Indies
60 Netherlands Antilles
61
Panama
62
Lebanon
63 Hong Kong
64
Singapore
65 Others 6
66 Miscellaneous and unallocated 7
*
1. The banking offices covered by these data are the U.S. offices and foreign
branches of U.S.-owned banks and of U.S. subsidiaries of foreign-owned banks.
Offices not covered include (1) U.S. agencies and branches of foreign banks, and
(2) foreign subsidiaries of U.S. banks. To minimize 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. The data in this table combine
foreign branch claims in table 3.13 (the sum of lines 7 through 10) with the claims
of U.S. offices in table 3.17 (excluding those held by agencies and branches of
foreign banks and those constituting claims on own foreign branches). However,
see also footnote 2.
2. For June 1978 and subsequent dates, the claims of the U.S. offices
in this table include only banks' own claims payable in dollars. For earlier dates
the claims of the U.S. offices also include customer claims and foreign currency
claims (amounting in June 1978 to $10 billion).
3. Includes Algeria, Bahrain, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria,Oman,
Qatar, Saudi Arabia, and United Arab Emirates in addition to countries shown
individually.
4. Foreign branch claims only through December 1976.
5. Excludes Liberia.
6. Foreign branch claims only.
7. Includes New Zealand, Liberia, and international and regional organizations.
A64
3.21
International Statistics • February 1980
MARKETABLE U.S. TREASURY BONDS AND NOTES
Foreign Holdings and Transactions
Millions of dollars
1979
Country or area
1977
1979
1978
Jan.Dec.P
July
June
Aug.
Sept.
Oct.
NOV.P
Dec.P
50,306
Holdings (end of period) 1
1 Estimated total 2
38,640
44,938
47,494
48,991
49,575
50,257
50,888
49,779
2 Foreign countries 2
33,894
39,817
43,454
44,544
44,979
45,060
45,206
44,276
44,875
3 Europe 2
4
Belgium-Luxembourg
5
Germany 2
6
Netherlands
7
Sweden
8
Switzerland
9
United Kingdom
10
Other Western Europe
11
Eastern Europe
12 Canada
13,936
19
3,168
911
100
497
8,888
349
4
288
17,072
19
8,705
1,358
285
977
5,373
354
21,047
24
10,751
1,695
484
1,582
6,016
496
22,213
24
10,781
1,655
481
1,843
6,938
491
22,558
24
10,952
1,577
525
2,048
6,895
538
22,599
65
10,953
1,667
588
2,496
6,193
637
22,692
65
11,082
1,660
600
2,427
6,191
666
21,910
60
11,337
1,490
593
1,961
5,955
513
23,705
60
12,937
1,466
647
1,868
6,236
491
152
227
232
233
233
235
234
232
13
14
15
16
17
18
19
20
551
199
183
170
18,745
6,860
362
11
416
144
110
162
21,488
11,528
691
-3
387
183
42
162
21,103
13,040
691
-3
537
183
192
162
20,874
13,090
691
-3
539
183
192
165
20,960
12,818
691
-3
539
183
192
165
21,000
12,789
691
-3
541
183
194
164
21,050
12,591
691
-3
539
183
192
164
21,005
12,502
591
-3
546
183
200
163
19,804
11,175
591
-3
4,746
5,121
4,040
4,447
4,596
5,197
5,682
5,503
5,431
3,993
48
4,400
48
4,551
46
5,150
46
5,636
46
5,463
40
5,388
40
Latin America and Caribbean
Venezuela
Other Latin American and Caribbean
Netherlands Antilles
Asia
Japan
Africa
All other
21 Nonmonetary international and regional
organizations
22 International
23 Latin American regional
4,646
100
5,089
33
Transactions (net purchases, or sales ( - ) , during period)
24 Total 2
22,843
6,297
5,368
111
1,497
584
681
632
-1,110
527
25 Foreign countries 2
26
Official institutions
27
Other foreign 2
21,130
20,377
753
5,921
3,727 r
2,195 r
5,058
1,781
3,277
399
298
101
1,090
1,033
57
435
515
-81
81
101
-20
146
56
89
-930
-1,037
108
600
547
53
28 Nonmonetary international and regional
organizations
1,713
375
311
-121
407
149
600
487
-180
-73
MEMO: Oil-exporting countries
29 Middle East 3
30 Africa 4
4,451
-181
- 1,785
329
-1,015
-100
8
-193
394
72
299
64
-100
168
2. Beginning December 1978, includes U.S. Treasury notes publicly issued to
private foreign residents.
3. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
4. Comprises Algeria, Gabon, Libya, and Nigeria.
1. Estimated official and private holdings of marketable U.S. Treasury securities
with an original maturity of more than 1 year. Data are based on a benchmark
survey of holdings as of Jan. 31, 1971, and monthly transactions reports. Excludes
nonmarketable U.S. Treasury bonds and notes held by official institutions of foreign countries.
3.22
FOREIGN OFFICIAL ASSETS HELD AT FEDERAL RESERVE BANKS
Millions of dollars, end of period
1979
Assets
1976
1977
July
1 Deposits
Assets held in custody
2 U.S. Treasury securities 1
3 Earmarked gold 2
Aug.
Sept.
Oct.
Nov.
Dec.
Jan .P
352
424
367
372
325
347
351
490
429
439
66,532
16,414
91,962
15,988
117,126
15,463
99,004
15,322
98,794
15,296
100,383
15,294
97,965
15,253
90,874
15,230
95,075
15,169
97,116
15,138
1. Marketable U.S. Treasury bills, notes, and bonds; and nonmarketable U.S.
Treasury securities payable in dollars and in foreign currencies.
2. The value of earmarked gold increased because of the changes in par value
of the U.S. dollar in May 1972 and in October 1973.
1980
1978
NOTE. Excludes deposits and U.S. Treasury securities held for international and
regional organizations. Earmarked gold is gold held for foreign and international
accounts and is not included in the gold stock of the United States,
Investment Transactions
3.23
A65
F O R E I G N T R A N S A C T I O N S IN S E C U R I T I E S
Millions of dollars
1979
Transactions, and area or country
1977
1979
1978
Jan.June
Dec.P
July
Aug.
Sept.
Oct.
Dec./'
NOV.P
U.S. corporate securities
STOCKS
1 Foreign purchases
2 Foreign sales
14,155
11,479
Foreign countries
Europe
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
Latin America and Caribbean
Middle East 1
Other Asia
Africa
Other countries
17 Nonmonetary international and regional
organizations
BONDS
22,593
20,974
2,676
3 Net purchases, or sales ( - )
4
5
6
7
8
9
10
11
12
13
14
15
16
20,142
17,723
2,420
1,619
66
2,661
1,006
40
291
22
152
613
65
127
1,390
59
5
8
2,466
1,283
47
620
-22
-585
1,230
74
151
781
187
-13
3
1,604
216
122
-221
-71
-519
964
550
-18
656
207
-14
7
67
11
41
-16
-15
-3
5
33
-28
15
39
-3
-1
15
-46
15
7,739
3,560
7,975
5,517
8,790
7,544
1,131'
793
1,861'
1,794
1,768'
1,775'
2,382
2,224
2,074
2,023
2,385
2,372
1,876
1,687
2,359
2,182
-7'
158
51
13
189
177
-7'
-42
18
-19
8
-52
-12
30
-17
-7
32
-3'
1
156
-48
19
-30
-3
-87
97
78
45
44
34
-4
7
58
-107
-20
-37
13
-34
-48
-32
38
-68
83
67
-93
59
18
-1
-3
192
77
-18
-18
12
-148
278
14
-7
133
-29
1
2
173
75
8
-10
-25
-68
155
47
40
32
-21
-3
2
*
2
-7
869
648
729
673
398
288
*
-64
19
145
-8
41
-12
-2
1
*
-3
4
827
639
732
913
964
550
2
18 Foreign purchases
19 Foreign sales
20 Net purchases, or sales ( - )
4,179
2,458
1,246
338'
221
56
110
188
-181
414
21 Foreign countries
4,083
2,049
1,348
304'
222
71
23
48
-118
429
22
23
24
25
26
27
28
29
30
31
32
33
1,850
-34
-20
72
94
1,690
141
64
1,695
338
-6
675
11
83
-202
-61
816
90
112
374
94
1
1
159
-34
-11
-9
-4
232
8
11
40
5
-5
-3
-10
-19
-8
24
9
10
50
7
19
-1
-1
-2
4
23
17
-4
-7
-4
1
88
1
-7
-7
103
8
6
-39
-16
-205
11
2
-15
-53
-124
-1
12
71
5
33
1
2
-20
7
36
-16
15
406
-10
*
908
30
68
12
-100
930
102
98
810
131
-1
1
1
*
*
*
96
409
-102
Europe
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
Latin America and Caribbean
Middle East*
Other Asia
Africa
Other countries
34 Nonmonetary international and regional
organizations
163
8
24
-32
-1
169
*
-10
102'
48
*
*
*
*
#
*
*
*
-14
87
140
-63
-14
34
*
*
Foreign securities
35 Stocks, net purchases, or sales ( - )
36
Foreign purchases
37
Foreign sales
-410
2,255
2,665
38 Bonds, net purchases, or sales ( - )
39
Foreign purchases
40
Foreign sales
-5,096
8,040
13,136
527
3,666
3,139
-4,052'
11,043'
15,094'
-993
4,512
5,504
-18
402'
421
-132'
327'
459'
-117'
377
494'
-338
420
758
-198
466
663
-84
365
449
-130
406
536
-3,916
12,374
16,290
-693'
1,011
1,704'
-373'
984
1,357'
-543
1,575
2,118
-725
829
1,554
-75
1,081
1,156
-335
1,080
1,415
-222
1,124
1,346
41 Net purchases, or sales ( - ) of stocks and bonds
-5,506
— 3,525'
-4,908
-711'
-505'
-660'
-1,063
-273
-420
-352
42
43
44
45
46
47
48
-3,949
-1,100
-2,404
-82
-97
2
-267
— 3,338'
-64'
-3,238'
201
350
-441
-146
-4,149
-1,734
-2,614
399
-212
-13
25
-429'
-148'
-221
53
-114
4
-4
-529'
-397'
-178
30
16
-2'
2
-577'
-290
-128
- 12'
-172
-1
2
-914
-120
-891
5
-277
-38
-358
11
112
-6
2
-301
-119
-97
29
-118
1
3
-490
-282
-80
-5
-128
3
3
-1,557
-187
-83
-150
4
-118
138
Foreign countries
Europe
Canada
Latin America and Caribbean
Asia
Africa
Other countries
49 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).
-760
-282
24
*
92
*
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
A66
International Statistics • February 1980
3.24
LIABILITIES TO UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the
United States>
Millions of dollars, end of period
1978
Type, and area or country
1979
1977
June
1 Total
Sept.
Mar.
June'
Sept.P
Dec.
10,099
2 Payable in dollars
3 Payable in foreign currencies 2
11,085
14,468'
11,870
12,786
13,953'
15,164
15,372
9,390
709
10,284
801
11,412'
3,056
11,044
825
11,955
831
11,254'
2,699
12,415
2,749
12,477
2,895
By type
4 Financial liabilities
5
Payable in dollars
6
Payable in foreign currencies
6,011'
3,745'
2,265
5,775'
3,703'
2,072
5,781
3,735
2,046
5,881
3,738
2,143
7 Commercial liabilities
8
Trade payables
9
Advance receipts and other liabilities
8,458
3,929
4,529
8,178
3,445
4,733
9,384
4,244
5,140
9,491
4,015
5,476
10 Payable in dollars
11 Payable in foreign currencies
7,667
791
7,551
627
8,680
703
8,739
753
By area or country
Financial liabilities
Europe
Belgium-Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
3,772
287
162
371
364
204
2,064
3,528
264
138
329
396
190
2,009
3,394
313
134
271
378
231
1,852
3,426
276
125
370
407
185
1,866
12
13
14
15
16
17
18
19
Canada
20
21
22
23
24
25
26
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
27
28
29
Asia
Japan
Middle East oil-exporting countries 3
30
Africa
31
32
203
754
671
48
Commercial liabilities
Europe
Belgium-Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
41
42
43
44
45
46
47
Latin America
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
48
49
50
Asia
Japan
Middle East oil-exporting countries 3
51
52
Africa
Oil-exporting countries 4
All other
5
1. For a description of the changes in the International Statistics tables, see July
1979 BULLETIN, p. 550.
2. Before December 1978, foreign currency data include only liabilities denominated in foreign currencies with an original maturity of less than one year.
2,930
75
317
529
208
314
760
292
311
1,325
442
37
19
127
131
65
1,381
345
37
14
139
121
68
745
667
36
759
706
19
752
700
19
5
1
6
2
5
1
5
2
All other 5
33
34
35
36
37
38
39
40
53
1,267'
407
41
13
132
101
52
5
Oil-exporting countries 4
224
1,272'
422
56
10
122
102
46
5
5
2,804
70
339
394
194
329
804
3,255
81
339
481
202
439
979
3,343
103
379
553
178
348
992
663
612
651
715
990
25
95
74
53
105
303
1,138
16
40
61
89
236
356
1,319
65
80
165
121
203
323
1,384
89
45
186
21
256
359
2,946
431
1,543
2,632
412
1,117
3,021
499
1,216
2,985
516
1,039
724
313
754
345
891
410
775
385
205
239
246
290
3. Comprises Bahrain, Iran. Iraq, Kuwait, Oman Qatar Saudi Arabia
United Arab Emirates (Trucial States).
4. Comprises Algeria, Gabon, Libya, and Nigeria.
5. Includes nonmonetary international and regional organizations.
and
Nonbank-Reported
3.25
CLAIMS ON UNAFFILIATED FOREIGNERS
United States*
Data
A67
Reported by Nonbanking Business Enterprises in the
Millions of dollars, end of period
1979
Type, and area or country
1976
1977
1978
June
27,194
23,229
23,260
24,223
2,971
21,665
1,564
21,292
1,968
Sept.?
Sept.
29,138
29,808
26,939
2,775
26,235
2,904
27,109
2,699
15,885
10,770
9,707
1,063
5,115
3,541
1,574
18,995
13,899
12,991
908
5,096
3,567
1,529
18,122
12,807
11,871
936
5,315
3,752
1,563
18,034
12,661
11,759
901
5,373
3,984
1,389
11 Commercial claims
12
Trade receivables
13
Advance payments and other claims ...
11,309
647
10,719
9,963
756
11,016
10,311
705
11,774
10,965
809
14
15
10,976
333
10,381
338
10,612
404
11,366
408
5,010
48
174
530
103
98
3,814
5,191
63
170
266
86
96
4,283
5,458
54
183
361
62
81
4,478
6,387
33
191
391
51
85
5,357
21,298
1 Total
2 Payable in dollars
3 Payable in foreign currencies
2
18,300
1,050
19,880
1,418
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 countries
16
17
18
19
20
21
22
Payable in dollars
Payable in foreign currencies
By area or country
Financial claims
Europe
Belgium-Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
10,662
29,714
Dec.
23
Canada
4,463
5,137
5,066
4,538
24
25
26
27
28
29
30
Latin America and Carribbean
Bahamas
Bermuda ....!
Brazil
British West Indies
Mexico
Venezuela
5,271
2,857
80
151
1,275
168
148
7,598
4.098
62
137
2,438
166
141
6,512
3,173
57
122
2,278
158
148
5,943
2,773
61
114
1,711
155
137
31
32
33
Asia
Japan
Middle East oil-exporting countries 3
918
306
18
826
206
17
800
216
17
818
222
21
34
Africa
182
10
204
26
227
23
278
41
3,940
143
609
395
257
208
803
3,818
172
490
501
271
248
681
3,842
174
473
435
306
232
724
4,170
184
549
467
262
224
815
35
36
37
38
39
40
41
42
43
44
Oil-exporting countries 4
All other 5
Commercial claims
Europe
Belgium-Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
1,105
1,113
1,127
1,174
45
46
47
48
49
50
51
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
2,535
109
215
625
9
506
292
2,382
117
241
490
10
488
273
2,403
98
118
499
25
584
296
2,562
16
152
565
13
647
345
52
53
54
Asia
Japan
Middle East oil-exporting countries 3
3,090
977
712
2,757
895
670
2,969
1,003
685
3,106
1,129
661
55
56
Africa
Oil-exporting countries 4
451
137
466
132
487
139
548
139
57
All other 5
188
1. For a description of the changes in the International Statistics tables, see July
1979, BULLETIN, p . 550.
2. Prior to December 1978, foreign currency data include only liabilities denominated in foreign currencies with an original maturity of less than one year.
213
3. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
4. Comprises Algeria, Gabon, Libya, and Nigeria.
5. Includes nonmonetary international and regional organizations.
A68
International Statistics • February 1980
3.26
DISCOUNT RATES OF FOREIGN CENTRAL BANKS
Percent per annum
Rate on Jan. 31, 1980
Rate on Jan. 31, 1980
Percent
Feb. 1972
Jan. 1980
Dec. 1979
Nov. 1978
Oct. 1979
Sept. 1979
Country
Percent
Month
effective
18.0
5.25
10.5
33.0
14.0
Argentina
Austria ..
Belgium .
Brazil ....
Canada ..
Denmark
11.0
France
Germany, Fed. Rep. of
Italy
Japan
Mexico
Netherlands
NOTE. Rates shown are mainly those at which the central bank either
discounts or makes advances against eligible commercial paper and/or
governments securities for commercial banks or brokers. For countries with
3.27
Rate on Jan. 31, 1980
Country
Country
9.5
6.0
15.0
6.25
4.5
9.5
Month
effective
Aug.
Nov.
Dec.
Nov.
June
Nov.
1977
1979
1979
1979
1942
1979
Percent
Norway
Sweden
Switzerland
United Kingdom
Venezuela
9.0
10.0
2.0
17.0
8.5
more than one rate applicable to such discounts or advances, the rate
shown is the one at which it is understood the central bank transacts the
largest proportion of its credit operations.
FOREIGN SHORT-TERM INTEREST RATES
Percent per annum, averages of daily figures
1979
1977
Country, or type
1978
Aug.
1
2
3
4
5
6
7
8
9
10
Sept.
Nov.
Oct.
Dec.
Jan.
6.03
8.07
7.47
4.30
2.56
8.74
9.18
8.52
3.67
0.74
11.96
13.60
11.91
6.64
2.04
11.53
14.06
11.78
7.04
1.67
12.61
14.11
11.89
7.82
1.94
14.59
14.12
13.34
8.84
2.57
15.00
16.09
14.19
9.57
3.97
14.51
16.71
14.02
9.54
5.67
14.33
17.30
13.93
8.79
5.45
4.73
9.20
14.26
6.95
6.22
6.53
8.10
11.40
7.14
4.75
9.33
9.44
11.85
10.48
6.10
9.51
10.85
11.50
11.42
7.00
9.82
11.67
11.51
11.88
7.00
10.09
12.14
12.71
12.99
7.01
11.86
12.72
13.12
14.17
8.13
14.56
12.55
16.01
14.49
8.42
11.85
12.31
17.00
14.38
8.44
Eurodollars
United Kingdom
Canada
Germany
Switzerland
Netherlands
France
Italy
Belgium
Japan
NOTE. Rates are for 3-month interbank loans except for the following:
Canada, finance company paper; Belgium, time deposits of 20 million
3.28
1980
1979
francs and over; and Japan, loans and discounts that can be called after
being held over a minimum of two month-ends.
FOREIGN E X C H A N G E RATES
Cents per unit of foreign currency
1979
Country/currency
1977
1978
1980
1979
Sept.
Aug.
Oct.
Nov.
Dec.
Jan.
Australia/dollar
Austria/schilling
Belgium/franc
Canada/dollar
Denmark/krone
110.82
6.0494
2.7911
94.112
16.658
114.41
6.8958
3.1809
87.729
18.156
111.77
7.4799
3.4098
85.386
19.010
112.83
7.4786
3.4140
85.425
18.964
112.63
7.7211
3.4684
85.814
19.279
111.31
7.7570
3.4656
85.084
19.110
109.34
7.8345
3.4822
84.771
19.034
110.30
8.0039
3.5423
85.471
18.618
110.97
8.0689
3.5688
85.912
18.568
6
7
8
9
10
Finland/markka
France/franc
Germany/deutsche mark
India/rupee
Ireland/pound
24.913
20.344
43.079
11.406
174.49
24.337
22.218
49.867
12.207
191.84
27.732
23.504
54.561
12.265
204.65
26.075
23.491
54.666
12.484
205.79
26.242
23.826
55.758
12.289
209.18
26.483
23.809
55.884
12.159
208.28
26.428
24.065
56.470
12.209
208.70
26.830
24.614
57.671
12.350
212.76
27.082
24.750
57.986
12.519
214.31
11
12
13
14
15
Italy/lira
Japan/yen
Malaysia/ringgit
Mexico/peso
Netherlands/guilder
16
17
18
19
20
New Zealand/dollar
Norway/krone
Portugal/escudo
South Africa/rand
Spain/peseta
96.893
18.789
2.6234
114.99
1.3287
103.64
19.079
2.2782
115.01
1.3073
102.23
19.747
2.0437
118.72
1.4896
101.40
19.877
2.0332
119.38
1.5132
100.28
20.080
2.0297
119.91
1.5135
21
22
23
24
Sri Lanka/rupee
Sweden/krona
Switzerland/franc
United Kingdom/pound
11.964
22.383
41.714
174.49
6.3834
22.139
56.283
191.84
6.4226
23.323
60.121
212.24
6.4174
23.693
60.349
223.68
103.31
92.39
88.09
87.24
1
2
3
4
5
.11328
.37342
40.620
4.4239
40.752
.11782
.47981
43.210
4.3896
46.284
.12035
.45834
45.720
4.3826
49.843
MEMO:
25 United States/dollar1
1. Index of weighted average exchange value of U.S. dollar against currencies of other G-10 countries plus Switzerland. March 1973 = 100.
Weights are 1972-76 global trade of each of the 10 countries. Series
revised as of August 1978. For description and back data, see "Index of
.12219
.45890
46.363
4.3804
49.805
.12326
.44963
46.382
4.3858
50.635
.12112
.43405
46.074
4.3825
50.379
.12112
.40834
45.661
4.3726
50.686
.12329
.41613
45.931
4.3768
52.092
.12427
.42041
45.868
4.3780
52.527
98.564
20.143
1.9992
120.79
1.5117
96.813
19.928
1.9852
120.32
1.5051
98.100
20.092
2.0036
120.79
1.5039
98.690
20.373
2.0051
121.64
1.5124
6.4126
23.860
62.087
219.66
6.4000
23.747
61.350
214.38
6.4053
23.677
60.870
213.52
6.4300
23.935
62.542
220.07
6.4323
24.112
62.693
226.41
86.73
87.67
88.12
86.32
85.52
the Weighted-Average Exchange Value of the U.S. Dollar: Revision" on page
700 of t h e A u g u s t 1978 BULLETIN.
NOTE. Averages of certified noon buying rates in New York for cable transfers.
A 69
Guide to
Tabular Presentation and Statistical Releases
GUIDE TO TABULAR
Symbols and
PRESENTATION
Abbreviations
c
e
P
r
Corrected
Estimated
Preliminary
Revised (Notation appears on column heading
when more than half of 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)
General
Information
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 obli-
STATISTICAL
0
n.a.
n.e.c.
IPCs
REITs
RPs
SMSAs
Calculated to be zero
Not available
Not elsewhere classified
Individuals, partnerships, and corporations
Real estate investment trusts
Repurchase agreements
Standard metropolitan statistical areas
Cell not applicable
gations of the Treasury. "State and local government" also
includes municipalities, special districts, and other political
subdivisions.
In some of the tables details do not add to totals because of
rounding.
RELEASES
List Published Semiannually,
with Latest Bulletin
Reference
Issue
Anticipated schedule of release dates for individual releases
December 1979
Page
A-76
A 70
Federal Reserve Board of Governors
PAUL A . VOLCKER,
Chairman
Vice Chairman
HENRY C. WALLICH
FREDERICK H . SCHULTZ,
PHILIP E . COLDWELL
OFFICE OF BOARD
OFFICE OF STAFF DIRECTOR
MONETARY AND FINANCIAL
MEMBERS
JOSEPH R . COYNE, Assistant
to the
Board
JAY PAUL BRENNEMAN, Special Assistant
to the
Board
FRANK O'BRIEN, JR., Special Assistant
to the
Board
JOSEPH S. SIMS, Special Assistant
to the
Board
DONALD J. W I N N , Special Assistant
to the
Board
LEGAL
FOR
POLICY
STEPHEN H . AXILROD, Staff
Director
EDWARD C. ETTIN, Deputy
Staff
Director
MURRAY ALTMANN, Assistant
to the
Board
PETER M . KEIR, Assistant
to the
Board
STANLEY J. SIGEL, Assistant
to the
Board
NORMAND R . V . BERNARD, Special Assistant
to the
Board
DIVISION
NEAL L . PETERSEN, General
Counsel
ROBERT E . MANNION, Deputy
General
Counsel
CHARLES R. MCNEILL, Assistant
to the General
Counsel
J. VIRGIL MATTINGLY, Assistant
General
Counsel
GILBERT T. SCHWARTZ, Assistant
General
Counsel
OFFICE OF THE
SECRETARY
THEODORE E . A L L I S O N ,
Secretary
GRIFFITH L . GARWOOD, Deputy
Secretary
* WILLIAM N . MCDONOUGH, Assistant
Secretary
RICHARD H . PUCKETT, Manager,
Regulatory
Project
DIVISION OF CONSUMER
AND COMMUNITY AFFAIRS
JANET O . H A R T ,
Director
Director
DIVISION OF BANKING
SUPERVISION AND REGULATION
JOHN E . R Y A N ,
Director
FREDERICK R. DAHL, Associate
Director
WILLIAM TAYLOR, Associate
Director
WILLIAM W . WILES, Associate
Director
JACK M . EGERTSON, Assistant
Director
ROBERT A . JACOBSEN, Assistant
Director
DON E . KLINE, Assistant
Director
ROBERT S. PLOTKIN, Assistant
Director
THOMAS A . SIDMAN, Assistant
Director
SAMUEL H . TALLEY, Assistant
Director
JAMES L . K I C H L I N E ,
AND
STATISTICS
Director
JOSEPH S. ZEISEL, Deputy
Director
JOHN H . KALCHBRENNER, Associate
Director
MICHAEL J. PRELL, Associate
Director
ROBERT A . EISENBEIS, Senior Deputy Associate
Director
+
JOHN J. MINGO, Senior Deputy Associate
Director
ELEANOR J. STOCKWELL, Senior Deputy Associate
Director
JAMES M . BRUNDY, Deputy Associate
Director
JARED J. ENZLER, Deputy Associate
Director
J. CORTLAND G . PERET, Deputy Associate
Director
HELMUT F . WENDEL, Deputy Associate
Director
ROBERT M . FISHER, Assistant
Director
FREDERICK M . STRUBLE, Assistant
Director
STEPHEN P. TAYLOR, Assistant
Director
Director
(Administration)
LEVON H . GARABEDIAN, Assistant
DIVISION OF INTERNATIONAL
Director
NATHANIEL E . BUTLER, Associate
JERAULD C. KLUCKMAN. Associate
Improvement
DIVISION OF RESEARCH
EDWIN M . TRUMAN,
FINANCE
Director
ROBERT F . GEMMILL, Associate
Director
GEORGE B . HENRY, Associate
Director
CHARLES J. SIEGMAN, Associate
Director
SAMUEL PIZER, Staff
Adviser
JEFFREY R . SHAFER, Deputy Associate
Director
DALE W . HENDERSON, Assistant
Director
LARRY J. PROMISEL, Assistant
Director
RALPH W . SMITH, JR., Assistant
Director
A 71
and Official Staff
J. CHARLES PARTEE
NANCY H .
EMMETT J. RICE
TEETERS
OFFICE OF
STAFF DIRECTOR FOR
OFFICE OF STAFF DIRECTOR FOR
FEDERAL RESERVE BANK ACTIVITIES
MANAGEMENT
JOHN M . DENKLER, Staff
Director
EDWARD T . MULRENIN, Assistant
Staff
Director
JOSEPH W . DANIELS, SR., Director of Equal Employment
WILLIAM H . WALLACE, Staff
HARRY A . GUINTER, Assistant
Op-
Director
Director
for
Planning
portunity
DIVISION OF DATA
PROCESSING
CHARLES L . H A M P T O N ,
BRUCE M .
UYLESS D .
GLENN L .
ROBERT J.
DIVISION
Director
JAMES R . K U D L I N S K I ,
BEARDSLEY, Associate
Director
BLACK, Assistant
Director
CUMMINS, Assistant
Director
ZEMEL, Assistant
Director
OF
PERSONNEL
DAVID L . SHANNON,
Director
JOHN R . WEIS, Assistant
Director
CHARLES W . WOOD, Assistant
Director
OFFICE OF THE
JOHN KAKALEC,
CONTROLLER
Controller
GEORGE E . LIVINGSTON, Assistant
DIVISION
OF SUPPORT
DONALD E . ANDERSON,
Controller
SERVICES
Director
WALTER W . KREIMANN, Associate
Director
*On loan from the Federal Reserve Bank of Boston.
+
On leave of absence.
DIVISION OF FEDERAL
BANK OPERATIONS
RESERVE
Director
CLYDE H . FARNSWORTH, JR., Deputy
Director
WALTER ALTHAUSEN, Assistant
Director
CHARLES W . BENNETT, Assistant
Director
LORIN S. MEEDER, Assistant
Director
P. D . RING, Assistant
Director
RAYMOND L . TEED, Assistant
Director
Contingency
A 72
Federal Reserve Bulletin • February 1980
FOMC and Advisory Councils
FEDERAL OPEN MARKET
PAUL A . VOLCKER,
COMMITTEE
Chairman
JOHN BALLES
ROBERT BLACK
PHILIP E . COLD WELL
MONROE KIMBREL
ROBERT MAYO
J. CHARLES PARTEE
EMMETT J. RICE
MURRAY A L T M A N N ,
Secretary
NORMAND R . V . BERNARD, Assistant
Secretary
N E A L L . PETERSEN, General
Counsel
JAMES H . OLTMAN, Deputy
General
Counsel
ROBERT E . M A N N I O N , Assistant
General
Counsel
STEPHEN H . AXILROD,
Economist
A L A N R . HOLMES, Adviser for Market
Operations
HARRY BRANDT, Associate
Economist
RICHARD G . DAVIS, Associate
Economist
FREDERICK H . SCHULTZ
N A N C Y H . TEETERS
HENRY C . WALLICH
E D W A R D C . ETTIN, Associate
Economist
GEORGE B . HENRY, Associate
Economist
PETER M . KEIR, Associate
Economist
MICHAEL KERAN, Associate
Economist
JAMES L . KICHLINE, Associate
Economist
JAMES PARTHEMOS, Associate
Economist
KARL SCHELD, Associate
Economist
E D W I N M . TRUMAN, Associate
Economist
JOSEPH S . ZEISEL, Associate
Economist
PETER D . STERNLIGHT, Manager for Domestic
Operations,
System Open Market
Account
SCOTT E. PARDEE, Manager for Foreign Operations,
System Open Market
Account
FEDERAL ADVISORY
COUNCIL
HENRY S. WOODBRIDGE, JR., First District
DONALD C . PLATTEN, Second District
WILLIAM B. EAGLESON, JR., Third District
MERLE E. GILLIAND, Fourth District
J. O W E N COLE, Fifth District
ROBERT STRICKLAND, Sixth District
ROGER E. ANDERSON, Seventh District
CLARENCE C . BARKSDALE, Eighth District
CLARENCE G . FRAME, Ninth District
GORDON E. WELLS, Tenth District
JAMES D. BERRY, Eleventh District
CHAUNCEY E. SCHMIDT, Twelfth District
HERBERT V . PROCHNOW,
WILLIAM J. KORSVIK, Associate
CONSUMER
ADVISORY
Secretary
Secretary
COUNCIL
WILLIAM
MARCIA
D.
A.
WARREN,
HAKALA,
Los Angeles, California, Chairman
Omaha, Nebraska, Vice Chairman
M.
Minneapolis, Minnesota
J. M C E W E N , S.J., Boston, Massachusetts
JULIA H . BOYD, Washington, D . C .
HARVEY
ROLAND E . BRANDEL, San Francisco, California
ELLEN BROADMAN, W a s h i n g t o n , D . C .
JAMES L . BROWN, Milwaukee, Wisconsin
MARK E . B U D N I T Z , Atlanta, Georgia
ROBERT V. BULLOCK, Frankfort, Kentucky
RICHARD S. D'AGOSTINO, Philadelphia, Pennsylvania
THE REV. ROBERT
JOANNE FAULKNER, N e w Haven, Connecticut
HENRY B . SCHECHTER, W a s h i n g t o n , D . C .
PETER D . SCHELLIE, W a s h i n g t o n , D . C .
VERNARD W. H E N L E Y , Richmond, Virginia
JUAN JESUS HINOJOSA, McAllen, Texas
SHIRLEY T. HOSOI, LOS Angeles, California
F. THOMAS JUSTER, Ann Arbor, Michigan
RICHARD F. KERR, Cincinnati, Ohio
ROBERT J. K L E I N , New York, New York
KUHNLEY,
R. C. MORGAN, El Paso, Texas
MARGARET REILLY-PETRONE, Upper Montclair, N e w Jersey
RENE REIXACH, Rochester, New York
FLORENCE M. RICE, New York, New York
RALPH J. ROHNER, W a s h i n g t o n D . C .
E. G. SCHUHART, II, Amarillo, Texas
CHARLOTTE H . SCOTT, Charlottesville, Virginia
RICHARD A. V A N WINKLE, Salt Lake City, Utah
RICHARD D. WAGNER, Simsbury, Connecticut
MARY W. WALKER, Monroe, Georgia
A 73
Federal Reserve Banks, Branches, and Offices
FEDERAL RESERVE BANK,
branch, or facility
Zip
Chairman
Deputy Chairman
President
First Vice President
BOSTON*
02016
Robert M. Solow
Robert P. Henderson
Frank E. Morris
James A. Mcintosh
NEW YORK*
10045
Robert H. Knight
Boris Yavitz
Frederick D. Berkeley, III
Anthony M. Solomon
Thomas M. Timlen
John W. Eckman
Werner C. Brown
David P. Eastburn
Richard L. Smoot
Robert E. Kirby
J. L. Jackson
Lawrence H. Rogers, II
William H. Knoell
Willis J. Winn
Walter H. MacDonald
Maceo A. Sloan
Steven Muller
Catherine Byrne Doehler
Robert E. Elberson
Robert P. Black
George C. Rankin
Buffalo
PHILADELPHIA,
..14240
, ,19105
CLEVELAND*
44101
Cincinnati
Pittsburgh
,45201
..15230
RICHMOND*
23261
Baltimore
Charlotte
21203
28230
John T. Keane
Robert E. Showalter
Robert D. Duggan
Jimmie R. Monhollon
Stuart P. Fishburne
Culpeper
Communications
and Records Center
22701
ATLANTA
Birmingham
Jacksonville
Miami
Nashville
New Orleans
30303
35202
32203
33152
,37203
70161
CHICAGO*
60690
Detroit
48231
ST. LOUIS
,63166
Little Rock
Louisville
Memphis
MINNEAPOLIS
Helena
KANSAS CITY
Denver
Oklahoma City
Omaha
DALLAS
El Paso
Houston
San Antonio
72203
40232
38101
55480
59601
, 64198
80217
73125
68102
75222
79999
77001
78295
SAN FRANCISCO
94120
Los Angeles
Portland
Salt Lake City
Seattle
90051
97208
, 84125
98124
Vice President
in charge of branch
Albert D. Tinkelenberg
William A. Fickling, Jr.
Monroe Kimbrel
John H. Weitnauer, Jr.
Robert P. Forrestal
Harold B. Blach, Jr.
Joan W. Stein
David G. Robinson
Robert C. H. Matthews, Jr.
George C. Cortright, Jr.
Hiram J. Honea
Charles D. East
F. J. Craven, Jr.
Jeffrey J. Wells
Pierre M.Viguerie
John Sagan
Stanton R. Cook
Howard F. Sims
Robert P. Mayo
Daniel M. Doyle
William C. Conrad
Armand C. Stalnaker
William B. Walton
E. Ray Kemp, Jr.
Richard O. Donegan
Frank A. Jones, Jr.
Lawrence K. Roos
Donald W. Moriarty, Jr.
Stephen F. Keating
William G. Phillips
Patricia P. Douglas
Mark H. Willes
Thomas E. Gainor
Joseph H. Williams
Paul H. Henson
Caleb B. Hurtt
Christine H. Anthony
Robert G. Lueder
Roger Guffey
Henry R. Czerwinski
Irving A. Mathews
Gerald D. Hines
Chester J. Kesey
Gene M. Woodfin
Carlos A. Zuniga
Ernest T. Baughman
Robert H. Boykin
Cornell C. Maier
Caroline Ahmanson
Harvey A. Proctor
Loran L. Stewart
Wendell J. Ashton
Lloyd E. Cooney
John J. Balles
John B. Williams
John F. Breen
Donald L. Henry
L. Terry Britt
Betty J. Lindstrom
Wayne W. Martin
William G. Evans
Robert D. Hamilton
Joel L. Koonce Jr.
J. Z. Rowe
Carl H. Moore
Richard C. Dunn
Angelo S. Carella
A. Grant Holman
Gerald R. Kelly
*Additional offices of these Banks are located at Lewiston, Maine 04240; Windsor Locks, Connecticut 06096; Cranford, 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.
A 74
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A 75
CONSUMER
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INNOVATIONS IN B A N K L O A N CONTRACTING: RECENT EVIDENCE by Paul W. Boltz and Tim S. Campbell. May 1979.
The Board of Governors of the Federal Reserve System
Consumer Handbook To Credit Protection Laws
The Equal Credit Opportunity Act and . . . Age
The Equal Credit Opportunity Act and . . . Credit Rights in
Housing
The Equal Credit Opportunity Act and . . . Doctors,
Lawyers, Small Retailers, and Others Who May Provide
Incidental Credit
The Equal Credit Opportunity Act and . . . Women
Fair Credit Billing
The Federal Open Market Committee
Federal Reserve Bank Board of Directors
Federal Reserve Banks
Federal Reserve Glossary
How to File A Consumer Credit Complaint
If You Borrow To Buy Stock
If You Use A Credit Card
Truth in Leasing
U.S. Currency
What Truth in Lending Means to You
MEASUREMENT OF CAPACITY UTILIZATION: PROBLEMS AND
40 pp.
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Richard D. Raddock, and Zoltan E. Kenessey. July 1979.
264 pp.
THE
MARKET
FOR
FEDERAL
FUNDS
AND
REPURCHASE
AGREEMENTS, by Thomas D. Simpson. July 1979. 106 pp.
IMPACT OF B A N K H O L D I N G COMPANIES ON COMPETITION
AND PERFORMANCE IN BANKING MARKETS, b y S t e p h e n
A. Rhoades and Roger D. Rutz. Aug. 1979. 30 pp.
T H E G N M A - G U A R A N T E E D PASSTHROUGH SECURITY: MARKET DEVELOPMENT AND IMPLICATIONS FOR THE GROWTH
A N D STABILITY OF HOME MORTGAGE L E N D I N G , b y
David F. Seiders. Dec. 1979. 65 pp.
Printed in Full in the Bulletin
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ASSESSMENT
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STAFF
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and financial
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Summaries Only Printed in the Bulletin
Requests to obtain single copies of the full text or to be
added to the mailing list for the series may be sent to Publications
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INTEREST RATE CEILINGS A N D DISINTERMEDIATION, b y E d -
ward F. McKelvey. Sept. 1978. 105 pp.
T H E RELATIONSHIP B E T W E E N RESERVE RATIOS A N D THE
MONETARY AGGREGATES U N D E R RESERVES A N D F E D ERAL F U N D S R A T E OPERATING TARGETS, b y K e n n e t h J.
Kopecky. Dec. 1978. 58 pp.
TIE-INS B E T W E E N THE GRANTING OF CREDIT A N D SALES OF
INSURANCE BY B A N K HOLDING COMPANIES A N D OTHER
LENDERS, by Robert A. Eisenbeis and Paul R. Schweitzer.
Feb. 1979. 75 pp.
GEOGRAPHIC EXPANSION OF BANKS A N D CHANGES IN BANK-
ING STRUCTURE, by Stephen A. Rhoades. Mar. 1979. 40
pp.
IMPACT OF THE DOLLAR DEPRECIATION ON THE U . S . PRICE
LEVEL: A N ANALYTICAL SURVEY OF EMPIRICAL ESTI-
MATES, by Peter Hooper and Barbara R. Lowrey. Apr.
1979. 53 pp.
by
Robert J. Lawrence and Samuel H. Talley. January 1976.
most
Measures of Security Credit. 12/70.
Revision of Bank Credit Series. 12/71.
Assets and Liabilities of Foreign Branches of U.S. Banks.
2/72.
Bank Debits, Deposits, and Deposit Turnover—Revised
Series. 7/72.
Yields on Newly Issued Corporate Bonds. 9/72.
Yields on Recently Offered Corporate Bonds. 5/73.
Rates on Consumer Instalment Loans. 9/73.
New Series for Large Manufacturing Corporations. 10/73.
The Structure of Margin Credit. 4/75.
Industrial Electric Power Use. 1/76.
Revision of Money Stock Measures. 2/76.
Revised Series for Member Bank Deposits and Aggregate Reserves. 4/76.
Industrial Production— 1976 Revision. 6/76.
Federal Reserve Operations in Payment Mechanisms: A
Summary. 6/76.
New Estimates of Capacity Utilization: Manufacturing and
Materials. 11/76.
The Commercial Paper Market. 6/77.
The Federal Budget in the 1970's. 9/78.
Redefining the Monetary Aggregates. 1/79.
U.S. International Transactions in 1978. 4/79.
Implementation of the International Banking Act. 10/79.
Changes in Bank Lending Practices, 1977-79. 10/79.
A 76
Index to Statistical Tables
References are to pages A-3 through A-72 although the prefix "A" is omitted in this index
ACCEPTANCES, bankers, 11, 25,27
Agricultural loans, commercial banks, 18,20-22, 26
Assets and liabilities (See also Foreigners)
Banks, by classes, 16, 17,18,20-23,29
Domestic finance companies, 39
Federal Reserve Banks, 12
Nonfinancial corporations, current, 38
Automobiles
Consumer installment credit, 42,43
Production, 48,49
BANKERS balances, 16, 18, 20, 21, 22. (See also Foreigners)
Banks for Cooperatives, 35
Bonds (See also U.S. government securities)
New issues, 36
Yields, 3
Branch banks
Assets and liabilities of foreign branches of U.S. banks, 56
Liabilities of U.S. banks to their foreign branches, 23
Business activity, 46
Business expenditures on new plant and equipment, 38
Business loans (See Commercial and industrial loans)
CAPACITY utilization, 46
Capital accounts
Banks, by classes, 16, 17, 19,20
Federal Reserve Banks, 12
Central banks, 68
Certificates of deposit, 23, 27
Commercial and industrial loans
Commercial banks, 15, 18,26
Weekly reporting banks, 20, 21, 22, 23, 24
Commercial banks
Assets and liabilities, 3, 15-19, 20-23, 69-72
Business loans, 26
Commercial and industrial loans, 24, 26
Consumer loans held, by type, 42,43
Loans sold outright, 23
Number, by classes, 16, 17, 19
Real estate mortgages held, by type of holder and
property, 41
Commercial paper, 3, 25, 27, 39
Condition statements (See Assets and liabilities)
Construction, 46, 50
Consumer installment credit, 42,43
Consumer prices, 46, 51
Consumption expenditures, 52, 53
Corporations
Profits, taxes, and dividends, 37
Security issues, 36, 65
Cost of living (See Consumer prices)
Credit unions, 29,42, 43
Currency and coin, 5, 16, 18
Currency in circulation, 4, 14
Customer credit, stock market, 28
DEBITS to deposit accounts, 13
Debt (See specific types of debt or securities)
Demand deposits
Adjusted, commercial banks, 13,15,19
Banks, by classes, 16, 17, 19,20-23
Ownership by individuals, partnerships, and
corporations, 25
Subject to reserve requirements, 15
Turnover, 13
Deposits (See also specific types)
Banks, by classes, 3, 16, 17, 19, 20-23, 29, 69-72
Federal Reserve Banks, 4, 12
Subject to reserve requirements, 15
Turnover, 13
Discount rates at Reserve Banks (See Interest rates)
Discounts and advances by Reserve Banks (See Loans)
Dividends, corporate, 37
EMPLOYMENT, 46, 47
Eurodollars, 27
FARM mortgage loans, 41
Farmers Home Administration, 41
Federal agency obligations, 4,11,12,13, 34
Federal and federally sponsored credit agencies, 35
Federal finance
Debt subject to statutory limitation and types and
ownership of gross debt, 32
Receipts and outlays, 30, 31
Treasury operating balance, 30
Federal Financing Bank, 30,35
Federal funds, 3,6, 18, 20, 21, 22,27,30
Federal Home Loan Banks, 35
Federal Home Loan Mortgage Corporation, 35,40,41
Federal Housing Administration, 35,40,41
Federal Intermediate Credit Banks, 35
Federal Land Banks, 35,41
Federal National Mortgage Association, 35,40,41
Federal Reserve Banks
Condition statement, 12
Discount rates (See Interest rates)
U.S. government securities held, 4, 12, 13, 32, 33
Federal Reserve credit, 4, 5, 12,13
Federal Reserve notes, 12
Federally sponsored credit agencies, 35
Finance companies
Assets and liabilities, 39
Business credit, 39
Loans, 20, 21, 22, 42, 43
Paper, 25, 27
Financial institutions, loans to, 18, 20-22
Float, 4
Flow of funds, 44,45
Foreign
Currency operations, 12
Deposits in U.S. banks, 4,12,19,20,21,22
Exchange rates, 68
Trade, 55
Foreigners
Claims on, 56, 58,61,62,63,67
Liabilities to, 23, 56-60,64-66
GOLD
Certificates, 12
Stock, 4,55
Government National Mortgage Association, 35,40,41
Gross national product, 52, 53
HOUSING, new and existing units, 50
INCOME, personal and national, 46, 52, 53
Industrial production, 46,48
Installment loans, 42,43
Insurance companies, 29, 32,33,41
A 77
Insured commercial banks, 17, 18, 19, 69-72
Interbank loans and deposits, 16,17
Interest rates
Bonds, 3
Business loans of banks, 26
Federal Reserve Banks, 3,8
Foreign countries, 68
Money and capital markets, 3,27
Mortgages, 3,40
Prime rate, commercial banks, 26
Time and savings deposits, 10, 72
International capital transactions of the United States, 56-67
International organizations, 56-61,64-67
Inventories, 52
Investment companies, issues and assets, 37
Investments (See also specific types)
Banks, by classes, 16,17,18,20,21,22,29
Commercial banks, 3,15,16,17,18
Federal Reserve Banks, 12,13
Life insurance companies, 29
Savings and loan associations, 29
LABOR force, 47
Life insurance companies (See Insurance companies)
Loans (See also specific types)
Banks, by classes, 16, 17, 18, 20-23, 29
Commercial banks, 3,15-18,20-23,24,26
Federal Reserve Banks, 3,4, 5,8,12,13
Insurance companies, 29,41
Insured or guaranteed by United States, 40,41
Savings and loan associations, 29
MANUFACTURING
Capacity utilization, 46
Production, 46,49
Margin requirements, 28
Member banks
Assets and liabilities, by classes, 16,17,18
Borrowings at Federal Reserve Banks, 5,12
Number, by classes, 16, 17,19
Reserve position, basic, 6
Reserve requirements, 9
Reserves and related items, 3 , 4 , 5 , 1 5
Mining production, 49
Mobile home shipments, 50
Monetary aggregates, 3,15
Money and capital market rates (See Interest rates)
Money stock measures and components, 3,14
Mortgages (See Real estate loans)
Mutual funds (See Investment companies)
Mutual savings banks, 3, 10, 20-22,29, 32, 33,41
NATIONAL banks, 17
National defense outlays, 31
National income, 52
Nonmember banks, 17,18,19
OPEN market transactions, 11
PERSONAL income, 53
Prices
Consumer and producer, 46, 51
Stock market, 28
Prime rate, commercial banks, 26
Production, 46,48
Profits, corporate, 37
REAL estate loans
Banks, by classes, 18,20-22,29,41
Real estate loans—continued
Life insurance companies, 29
Mortgage terms, yields, and activity, 3,40
Type of holder and property mortgaged, 41
Reserve position, basic, member banks, 6
Reserve requirements, member banks, 9
Reserves
Commercial banks, 16, 18, 20,21,22
Federal Reserve Banks, 12
Member banks, 3,4, 5, 15, 16,18
U.S. reserve assets, 55
Residential mortgage loans, 40
Retail credit and retail sales, 42,43,46
SAVING
Flow of funds, 44,45
National income accounts, 53
Savings and loan assns., 3, 10,29,33,41,44
Savings deposits (See Time deposits)
Savings institutions, selected assets, 29
Securities (See also U.S. government securities)
Federal and federally sponsored agencies, 35
Foreign transactions, 65
New issues, 36
Prices, 28
Special drawing rights, 4, 12, 54, 55
State and local governments
Deposits, 19,20,21,22
Holdings of U.S. government securities, 32, 33
New security issues, 36
Ownership of securities of, 18,20,21,22,29
Yields of securities, 3
State member banks, 17
Stock market, 28
Stocks (See also Securities)
New issues, 36
Prices, 28
TAX receipts, federal, 31
Time deposits, 3, 10, 13, 15, 16, 17, 19, 20, 21, 22, 23, 69-72
Trade, foreign, 55
Treasury currency, Treasury cash, 4
Treasury deposits, 4, 12, 30
Treasury operating balance, 30
UNEMPLOYMENT, 47
U.S. balance of payments, 54
U.S. government balances
Commercial bank holdings, 19, 20, 21,22
Member bank holdings, 15
Treasury deposits at Reserve Banks, 4,12, 30
U.S. government securities
Bank holdings, 16, 17, 18, 20, 21, 22, 29, 32, 33
Dealer transactions, positions, and financing, 34
Federal Reserve Bank holdings, 4,12,13,32, 33
Foreign and international holdings and transactions, 12,
32, 64
Open market transactions, 11
Outstanding, by type and ownership, 32, 33
Rates, 3,27
Utilities, production, 49
VETERANS Administration, 40,41
WEEKLY reporting banks, 20-24
Wholesale prices, 46, 51
YIELDS (See Interest rates)
78
The Federal Reserve System
Boundaries of Federal Reserve Districts and Their Branch Territories
Minneapolis
Chicago
Louisville
Kansas City
Nashvillt
lOklahoma City
l
»ge/es
Aittle Rock
Jhorlottej
\Atlanta >
®
Bjrminghai
Dallas®
Houston
January 1978
ALASKA
HAWAII
LEGEND
Boundaries of Federal Reserve Districts
Federal Reserve Bank Cities
Boundaries of Federal Reserve Branch
Territories
•
Federal Reserve Branch Cities
•
©
®
Federal Reserve Bank Facility
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@FedFRASER