Full text of Federal Reserve Bulletin : February 1993
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VOLUME 7 9 •
NUMBER 2 •
FEBRUARY 1993
FEDERAL RESERVE
BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM, WASHINGTON, D . C .
PUBLICATIONS COMMITTEE
Joseph R. Coyne, Chairman • S. David Frost • Griffith L. Garwood
• Donald L. Kohn • J. Virgil Mattingly, Jr. • Michael J. Prell • Edwin M. Truman
The Federal Reserve Bulletin is issued monthly under the direction of the staff publications committee. This committee is responsible for opinions
expressed except in official statements and signed articles. It is assisted by the Economic Editing Section headed by S. Ellen Dykes, the Graphics
Center under the direction of Peter G. Thomas, and Publications Services supervised by Linda C. Kyles.
Table of Contents
77 RECENT DEVELOPMENTS IN THE
MARKET FOR PRIVATELY PLACED DEBT
The market for privately placed debt has undergone major changes in the past three years.
Life insurance companies, the principal buyers of privately placed bonds, have significantly reduced their purchases of debt securities issued by below-investment-grade
borrowers. In addition, the adoption of Rule
144A in 1990 by the Securities and Exchange
Commission has spawned a new market for
private debt that is very similar to the public
corporate bond market. This article gives an
overview of the private placement market and
discusses these two developments.
93 INDUSTRIAL PRODUCTION AND
CAPACITY UTILIZATION
Industrial production rose 0.4 percent in
November; with the increase of 0.5 percent in
October, the rise has more than offset the
declines of late summer. Total industrial
capacity utilization rose another 0.2 percentage point in November, to 78.9 percent.
96 ANNOUNCEMENTS
Appointment of new members to the Thrift
Institutions Advisory Council.
Issuance of new Regulation F.
Adoption of final amendments and guidelines
to Regulation H.
Modifications of risk-based capital guidelines
on certain collateralized transactions.
Amendment to risk-based capital guidelines
for state member banks and bank holding
companies.
Issuance of policy statement on the use
of large-value fund transfers for money
laundering.
Reporting of deferred tax assets by bank holding companies.
Proposal to amend Regulation C; proposed
amendment to Regulation K.
Change in Board staff.
Publication of revised Bank Holding Company Supervision Manual.
100 RECORD OF POLICY ACTIONS OF THE
FEDERAL OPEN MARKET COMMITTEE
At its meeting on November 17, 1992, the
Committee adopted a directive that called for
maintaining the existing degree of pressure on
reserve positions and that included some bias
toward possible easing during the intermeeting period. Accordingly, in the context of the
Committee's long-run objectives for price stability and sustainable economic growth, and
giving careful consideration to economic,
financial, and monetary developments, slightly
greater monetary restraint might be acceptable
or slightly lesser monetary restraint would be
acceptable during the intermeeting period.
Two of the members expressed a strong preference for a symmetric directive with regard
to possible intermeeting policy adjustments,
while another was firmly persuaded of the
desirability of an immediate increase in
reserve availability to strengthen the growth
of M2. The reserve conditions contemplated
at this meeting were expected to be consistent
with growth in M2 and M3 at annual rates of
about 3'/2 and 1 percent respectively over the
three-month period from September through
December.
107 LEGAL DEVELOPMENTS
Various bank holding company, bank service
corporation, and bank merger orders; and
pending cases.
A1 FINANCIAL AND BUSINESS STATISTICS
These tables reflect data available as of
December 28, 1992.
A 3 GUIDE TO TABULAR
PRESENTATION
A4 Domestic Financial Statistics
A44 Domestic Nonfinancial Statistics
A53 International Statistics
A69 GUIDE TO STATISTICAL RELEASES AND
SPECIAL TABLES
A84 INDEX TO STATISTICAL TABLES
A86 BOARD OF GOVERNORS AND STAFF
A88 FEDERAL OPEN MARKET COMMITTEE
AND STAFF; ADVISORY COUNCILS
A 9 0 FEDERAL RESERVE
PUBLICATIONS
BOARD
A92 MAPS OF THE FEDERAL RESERVE
SYSTEM
A94 FEDERAL RESERVE BANKS, BRANCHES,
AND OFFICES
Recent Developments in the Market
for Privately Placed Debt
This article was prepared by Mark S. Carey,
Stephen D. Prowse, and John D. Rea, of the
Board's Division of Research and Statistics, and
Gregory F. Udell, who was a visiting economist in
the division and is now at the Stern School of
Business, New York University. Dana Cogswell and
William Gerhardt provided research assistance.
The market for privately placed debt has undergone
major changes in the past three years. Life insurance companies, the principal buyers of privately
placed bonds, have significantly reduced their purchases of debt securities issued by belowinvestment-grade borrowers. In addition, the adoption of Rule 144A in 1990 by the Securities and
Exchange Commission has spawned a new market
for private debt that is similar to the public corporate bond market.
These changes have focused attention on
a market that normally receives little publicity
because private issuers need not publicly disclose
information about themselves or their transactions.
Private placements are securities that are exempt
from registration with the Securities and Exchange
Commission (SEC) by virtue of being issued in
transactions that involve no public offerings.
(Although "private placements" may be either debt
or equity securities, in this article, the term refers
only to privately placed debt.) In keeping with the
absence of a public offering, private placements are
typically offered only to a limited number of wellinformed investors, usually institutions, which also
generally do not disclose information about their
transactions.
The private placement market has long been a
significant source of long-term, fixed-rate funds for
U.S. corporations. Since 1990, however, below-
NOTE. This article is based on a forthcoming staff study by the
same authors, "The Economics of the Private Placement Market."
investment-grade borrowers have found the availability of funds in the private market to be sharply
reduced, as life insurance companies have confined
their acquisitions almost exclusively to investmentgrade bonds. This change in the composition of
their purchases has occurred because of public
concern about the quality of insurers' assets and
because of a regulatory reclassification in 1990 of
many private placements from investment grade to
speculative grade. The reluctance of insurance
companies to lend to riskier borrowers, coupled
with the failure of other institutions to fill the void,
has shut off many medium-sized companies' supply of long-term debt financing. Because any significant return of insurance companies to this segment of the market depends on an improvement in
the quality of their other assets, the availability of
credit in the below-investment-grade segment of
the private market may continue to be limited for
some time.
The change induced in the private market by
Rule 144 A has occurred during the same period but
is much different in nature. Rule 144A allows
large, sophisticated institutions—defined as qualified institutional buyers (QIBs)—to trade private
placements freely among themselves. Relying on
the rule, securities firms have begun for the first
time to underwrite some new issues, distributing
them to QIBs. (Before the adoption of Rule 144A,
the conditions under which private placements
could be resold effectively prevented the underwriting of private securities.) The advent of underwritten offerings has created a market segment that has
many characteristics of the public corporate bond
market. This market segment differs significantly
from the traditional private market, and it has
proved especially attractive to foreign corporations, which can avoid the disclosure requirements
of a public offering while still enjoying many of the
benefits of the public market. Though the 144A
market is still developing and small in size, it could
78
Federal Reserve Bulletin • February 1993
be a major step toward the integration of U.S. and
foreign bond markets.
1. Gross issuance of publicly offered and privately placed
bonds by nonfinancial corporations, 1975-91
Billions of dollars
OVERVIEW OF THE PRIVATE DEBT
The private placement market has characteristics in
common with both the bank loan and the public
bond markets. All three markets are important
sources of funds for U.S. corporations. But, as in
the bank loan market, borrowers in the private
placement market tend to be less well known companies that require lenders to engage in extensive
due diligence and loan monitoring. As in the public
bond market, private placements are securities, and
their issuance is very often assisted by an agent,
who provides many of the services performed by
underwriters of public bonds.
Size of the Market
The private placement market is an important
source of credit market funds for U.S corporations.
Between 1986 and 1991, for example, gross issuance of private placements by nonfinancial corporations averaged $65 billion per year, or nearly
75 percent of that in the public market (table l). 1 In
1988 and 1989, private issuance actually exceeded
public issuance, as the financing of acquisitions
and employee stock ownership plans boosted private offerings (chart 1). Public issuance surged
in 1991, however, partly reflecting the refinancing
of outstanding debt, whereas private issuance
1. Gross issuance of publicly offered and privately placed
bonds by nonfinancial corporations, 1975—91
Billions of dollars, annual rate
Type of bonds
Public
1975-80
1981-85
1986-91
21.0
14.7
35.6
19.8
87.6
64.8
SOURCE. Federal Reserve Board and IDD Information Services.
1. Data for gross issuance of private placements are from IDD
Information Services, which obtains the data from a survey of
investment banks and commercial banks serving as agents in placing the securities. Data for private placements that do not involve
an agent are not included. Consequently, reported totals probably
understate gross issuance of private placements.
A Public bonds
MARKET
/
\
/
/ —
100
75
/ /—
/
- Y
1
1
50
/
Private placements —
1
1
1975
1
1
1
1980
1
1
1
1
1
1985
1
1
1
1
1
25
1
1990
SOURCE. Federal Reserve Board and IDD Information Services.
fell. The punitive prepayment penalties normally
attached to privately placed debt make refinancing
unattractive to issuers even when interest rates are
falling.
Comparisons of gross issuance of private placements and public bonds tend to overstate the relative importance of the private market as a source of
corporate financing because private bonds generally have shorter maturities than public bonds. The
median average life of private placements is
between six and seven years, whereas that of public
bonds is around ten years. Nonetheless, in terms of
issues outstanding at year-end 1991, private placements of nonfinancial corporations stood at
$250 billion. For comparison, outstandings of public bonds issued by nonfinancial corporations were
$800 billion; bank loans to such corporations were
$530 billion; and finance company loans to nonfinancial corporations were $150 billion.2
Borrowers
The typical borrower in the private placement market is a medium-sized corporation. Large firms
tend to issue in the public bond market, and small
firms generally borrow only in the bank loan mar-
2. Outstandings of public bonds of nonfinancial corporations are
the sum of bonds rated by Moody's Investors Service and publicly
issued medium-term notes. Private placements are estimated by
subtracting the figure for public bonds from outstandings of all
corporate bonds reported in the flow of funds accounts. Data for
bank loans and finance company loans are from the flow of funds
accounts.
Recent Developments in the Market for Privately Placed Debt
ket. For a sample of nonfinancial corporations, the
median value of assets for those borrowing in the
private market was $0.5 billion in 1989, whereas
the median for those borrowing in the public market was $1.5 billion. Because issuers are smaller in
the private market, issue sizes are also smaller on
average than in the public market: Nearly twothirds of the number of all private placements in
1989 were between $10 million and $100 million,
whereas more than 85 percent of the public issues
were in excess of $100 million (chart 2). For the
same year, the median issue size of private placements was $34 million, and the median for public
bonds was $150 million.
An interaction among issue size, issuing costs,
and yields is often thought to be the major reason
that medium-sized firms tend to offer their securities in the private rather than in the public market.
Issuance costs are lower for a private placement
than for a public offering, in part because the issuer
does not have to incur the considerable expense of
registering the issue with the SEC. Also, most
private placements, especially the smaller issues,
are not underwritten and thus typically have lower
distribution expenses than do public bonds, which
are almost always underwritten. In contrast, for
those few public and private issues that are of
comparable size and quality, yields are generally
higher on private placements than on public bonds.
The total cost of borrowing for comparable
medium-sized issues is thus generally lower in the
private market because any higher coupon rate that
must be paid there is offset by lower fixed costs of
issuance. Total costs for comparable large issues
2. Distribution of private placements and public bonds
by size of issue, 1989
Percent of number of issues
Private
•
Public
•
- —
50
-
_
1
! —
1
Less than 1
1,1 J 1 , *
j
•
1-10
10-100
100-250 More than 250
Size of issue, millions of dollars
SOURCE. Federal Reserve Board and IDD Information Services.
79
are generally lower in the public market because
fixed costs are a smaller percentage of large issues.
According to market participants, the break-even
point between the two markets is at issue sizes
between $75 million and $100 million.
Issue size, however, is not the main reason that
medium-sized companies borrow in the private
rather than in the public market. A more important
reason is that lenders must perform extensive credit
evaluations of such companies before loans can be
extended to them. In any credit transaction, public
or private, the lender must determine the financial
condition and prospects of the borrower. For large,
well-known companies, this task is facilitated by
the ready availability of information from many
sources. In contrast, for other, less well known
companies, a lender cannot obtain information as
easily and must collect the necessary information
on its own. Moreover, the lender must continue in
this effort after the credit is extended in order to
adequately monitor the borrower's ability to make
timely payments of interest and principal. Because
of the information problems that less well known
companies present to lenders, they are sometimes
referred to as information-problematic borrowers.
As a general rule, investors in securities sold in
the public bond market are not staffed to analyze
information-problematic borrowers, whereas lenders in the private placement market are capable of
performing this type of credit analysis. A negative
correlation between company size and the degree
of informational problems accounts for the differences in the typical sizes of companies borrowing
in the private and public markets. Thus, even if
total costs for small issues were not lower in the
private market, most medium-sized companies
would not have access to the public market because
of the information problems they pose for lenders.
Small firms are typically even more informationproblematic than medium-sized firms. Small firms
are seldom able to issue long-term, straight, unsecured debt because the credit risk involved in lending to them cannot be reliably evaluated over a
long term. They thus borrow mainly in shorterterm markets, principally the bank loan market,
rather than in the private market. Because banks
are willing to lend to more information-problematic
borrowers, their credit evaluation and monitoring
organizations are typically even more extensive
than those of insurance companies.
80
Federal Reserve Bulletin • February 1993
Issuance costs are also a factor tending to
exclude small businesses from the private debt
market. The fixed fees involved in placing debt
privately make very small issues uneconomical,
especially in comparison to bank loans. Furthermore, most buyers of private placements have little
interest in small issues. Consequently, few private
placements are less than $10 million in size.
Although information-problematic borrowers are
generally not large firms, many large corporations
have issued in the private market. Such companies
normally issue straight debt in the public bond
market but turn to the private market for complex
transactions. In these cases, the transactions themselves, rather than the borrowers, are difficult to
evaluate. Examples of such transactions are project
financings, capitalized equipment leases, joint ventures, and new forms of asset-backed securities.
Apart from information problems, other special
circumstances can lead large corporations to use
the private market. A corporation may wish to
issue debt quickly or to maintain confidentiality by
avoiding the disclosures required for a public offering, or it may wish to include customized features,
such as delayed disbursements of funds, in the
terms of the offering.
Besides being able to accommodate informationproblematic and specialized transactions, the private placement market offers borrowers the opportunity to establish relationships with lenders. The
primary disadvantages of private placements in
borrowers' eyes are the restrictive covenants and
stiff prepayment penalties typically found in private debt contracts. These penalties effectively
eliminate a borrower's option to cut interest costs
by refinancing debt when market interest rates
otherwise would permit.
Lenders
The major lenders in the private placement market
are among those financial intermediaries that specialize in lending to information-problematic borrowers. A financial intermediary is a financial institution that raises funds through the issuance of its
own debt or equity and then reinvests the proceeds
in financial assets. The types of financial intermediaries and their specializations vary widely. However, those in the private placement market have in
common a capacity to evaluate and monitor complex credit transactions. These intermediaries can
provide borrowers in the private placement market
with more favorable terms than would be available
in the public market partly because of their expertise and partly because they are large enough to
buy significant fractions of any issue. If many
investors each provided only a small part of each
borrower's loan, as is typical in the public market,
every investor would have to perform costly credit
evaluations, and the costs would be passed on to
the borrowers. Total costs are reduced when only a
few intermediaries lend to information-problematic
borrowers because only a few must perform credit
evaluations.
The major investors in private placements are
life insurance companies. At year-end 1991, they
held $212 billion of private placements.3 Holdings
are highly concentrated: The top five holders of
private placements have almost 40 percent of the
industry total, and the top twenty hold nearly
70 percent.4 Life insurance companies invest primarily in unsecured, fixed-rate private placements;
in keeping with the longer-term nature of their
liabilities, the average lives of private placements
they purchase are mainly between three and fifteen
years (chart 3). Insurance companies prefer private
placements falling in the lower end of the
investment-grade range of credit ratings (rated A
and BBB or the equivalent). For example, at the
end of 1991, 37 percent of insurance companies'
holdings were rated BBB (chart 4), and the majority of the 46 percent carrying a higher rating
were rated A. Before 1990, insurance companies
also purchased substantial quantities of below-
3. This figure includes private placements of both financial and
nonfinancial corporations but only those held in the general
accounts of insurance companies. No' estimate for those held in
separate accounts is available. At year-end 1991, corporate and
government bonds in separate accounts totaled $67 billion. For
comparison, corporate and government bonds in general accounts
totaled $810 billion at year-end 1991, of which $212 billion were
private placements.
4. The top five holders of private placements hold only 25 percent of the general account assets of all insurance companies, while
the top twenty hold 49 percent of all general account assets. The
proportion of assets that are privately placed debt securities is
naturally larger for these companies: The proportion of private
placements in their general account assets is 25.4 percent for the
top five and 22.7 percent for the top twenty, but only 9.6 percent for
the rest of the industry.
Recent Developments in the Market for Privately Placed Debt
3. Distribution of average lives of fixed-rate private
placement commitments measured as a percentage of the
total value of new private commitments by major life
insurance companies, January 1990-July 1992
81
4. Distribution of credit ratings of private placements
held by life insurance companies, 1991
SOURCE. National Association of Insurance Commissioners.
SOURCE. American Council of Life Insurance.
investment-grade private bonds, especially those
BB-rated bonds falling just short of investment
grade.
Life insurance companies are drawn to private
placements by their favorable risk-return ratio.
Yields on private placements are generally higher
than those on comparable public bonds, the higher
yield reflecting both the lack of liquidity of private
bonds and a return to the more intensive credit
analysis required by investors in the private market.5 Credit risk is controlled through covenants
that may limit the operations of the borrowers. For
example, covenants may restrict the incurrence of
additional debt, require the maintenance of a minimum level of net worth or a minimum ratio of
cash flow to interest expenses, limit cash payouts to
shareholders, or restrict the sale of assets. Violations of covenants serve as a warning that the
financial condition of the borrower may be deteriorating.6 Depending on the circumstances of a covenant violation, the lenders may either temporarily
waive a covenant, renegotiate the terms of the
5. The insurance companies are able to profit from any illiquidity premium because they hold most private placements to
maturity.
6. Many violations of covenants are not associated with deterioration of financial condition. Often a borrower whose condition has
not deteriorated will wish to make investments or acquisitions that
are forbidden by covenants. In such circumstances, the borrower
will attempt to negotiate a waiver of the covenant by the lender.
security, or require immediate repayment of principal if the borrower is unable to remedy the violation. The restrictiveness of covenants is inversely
related to the credit quality of the borrower. There
can also be a trade-off between restrictiveness and
the yield on the security. Finally, covenants tend to
be more numerous and more restrictive in private
placements than in public bonds, partly because of
the information-problematic nature of borrowers in
the private market. The smaller number of investors in private placements also makes negotiation
after violations of covenants more manageable.
Life insurance companies attempt to match the
duration of their investments in private placements
to the duration of their liabilities. Private placements provide flexibility in this regard because
maturities and sinking-fund provisions can be
tailored to meet specific needs. In addition, private
placements are seldom prepaid because they have
strong call protection. In 1991, for example, almost
20 percent of the private bonds purchased by the
largest life companies were noncallable. Another
70 percent had prepayment provisions that not
only enable the insurance companies to replace any
redeemed bonds at no reduction in interest income
but that also require issuers to pay a penalty in the
event of prepayment. Consequently, the primary
reason a borrower prepays a private placement is to
escape the confines of restrictive covenants.
The most important investors in private placements other than insurance companies have been
finance companies and pension funds. Finance
companies specialize in the highest-risk private
82
Federal Reserve Bulletin • February 1993
placements and, consequently, usually require
collateral and equity features such as warrants or
options to convert bonds to equity. Most investments in private placements by finance companies
are held by only about a half dozen large firms.
Similarly, only a handful of pension funds are
active investors in private placements. Most pension funds are geared primarily toward investing in
public bonds and have not built up staff to perform
the credit analysis and monitoring that is required
of investors in private placements.
Origination,
Negotiation,
and
Distribution
Most issuers of private placements enlist the services of an agent, typically an investment bank or
commercial bank, for advice and assistance in selling the securities. Initially, the agent helps the
issuer to prepare an offering memorandum, which
contains information about the issuer's business,
financial condition, and prospects, and a term sheet,
which contains the proposed terms of the offering.
Both are sent to prospective investors, which use
them to make a preliminary evaluation of the issuer's credit quality and to negotiate the final terms
of the offering. Once the terms have been agreed
upon, investors then verify the portrait of the issuer's business operations and financial condition
painted by the offering memorandum. An investor's analysis at this stage typically includes an
on-site visit to the company. From start to finish,
a routine transaction takes four to six weeks to
complete.
In distributing the securities, agents typically
operate on a "best-efforts" basis. In contrast to an
underwriter, an agent is under no obligation to
purchase the securities, so the issuer is not guaranteed funds. The use of a best-efforts distribution
mechanism reflects primarily the economics of
placing the debt of information-problematic borrowers: The risk associated with the failure to place
an issue is so great that such borrowers find bearing
it themselves less costly than hiring an underwriter
to bear it for them. Until the adoption of Rule
144A, underwriting was also effectively precluded
because an underwriting might constitute a public
offering.
Some issuers choose not to use an agent and
instead place their securities directly with inves-
tors. In most cases, such direct placements are sold
to lenders with which the issuer has had a previous
borrowing relationship, although a few insurance
companies also solicit and originate new business.
One advantage of a direct placement is the saving
of the agent's fee. Also, if the direct placement
follows a previous transaction between the same
parties, investors may be able to offer better terms
and faster execution. Nonetheless, even among
repeat borrowers in the private market, direct placements constitute only a minority of offerings.
Agents have better information than issuers about
market conditions and investors' preferences, and
they are experienced negotiators. Issuers thus generally can achieve lower borrowing costs by using
agents, even taking into account their fees.
Relationship
to Other
Markets
The private placement market is most frequently
compared with the public bond market, primarily
because the debt instruments issued in both markets are securities. Despite this similarity, the private placement market has much more in common
with the bank loan market, even though their debt
instruments are different. Borrowers in both the
bank loan and private placement markets are
information-problematic, and lenders in both markets are financial intermediaries specializing in
credit evaluation and monitoring. Consequently,
the typical medium-sized borrower in the private
placement market generally views a bank loan as
the closest alternative to a private placement.
A given borrower, however, would not find bank
loans and private placements to be perfect substitutes, because the characteristics of financings
available in the two markets typically differ. Bank
loans have short and intermediate maturities, generally of no more than seven years; in contrast,
private placements are intermediate to long term in
maturity. Bank loans normally carry floating rates
and can be prepaid at par, whereas private placements are usually fixed-rate securities with substantial prepayment penalties.7 The differences in matu-
7. The significance of the difference in types of interest rates is
lessened somewhat by the availability of interest rate swaps. Swaps
are costly, however, especially for many information-problematic
borrowers.
Recent Developments in the Market for Privately Placed Debt
rities and types of rate prevalent in the two markets
largely reflect differences in the duration of bank
and life insurance company liabilities.
Because of the differences in maturities between
bank loans and private placements, borrowers generally view the two forms of credit as competitive
only for maturities of three to seven years. A
borrower planning to raise funds in this range
of maturities will compare the total cost of
bank loans and private placements and base its
decision on both the price and nonprice terms of
the instruments.8
Differences in maturities across the bank loan
and private placement markets also influence the
characteristics of the average borrower and the
terms of the average loan. As noted, it is difficult to
evaluate the credit risk of very informationproblematic firms, which are typically small, over
the long term. Thus smaller, more-informationproblematic firms are much more frequently found
in the bank loan market. Because the average borrower in the bank loan market is more informationproblematic, the average bank loan has more
and tighter covenants than the average private
placement.
THE CREDIT CRUNCH
Since the middle of 1990, issuers of belowinvestment-grade securities have encountered a
sharp contraction in the availability of credit in the
private placement market. Interest rate spreads on
these securities have risen significantly, indicating
that the reduction in supply has been larger than
any decline in credit demand associated with the
weak economy. This situation has been termed a
credit crunch because it has resulted mainly from a
greater reluctance of life insurance companies to
assume below-investment-grade credit risk. The
sources of this reluctance have been the threat of
redemptions by liability holders (policyholders and
others), asset-quality problems, and regulatory
changes.
8. This choice, as noted above, is relevant only for mediumsized firms. Small firms typically do not have access to the private
placement market because they are too information-problematic.
83
2. Gross issuance of private placements by nonfinancial
corporations, 1989-911
Billions of dollars except as noted
Type of issuance
Below-investment-grade ...
1989
1990
1991
54.7
6.6
49.9
8.1
42.9
3.8
12.1
16.2
8.9
MEMO
Ratio of below-investmentgrade to total (percent) ..
1. Excludes restructuring-related issues in excess of $250 million and
issues to finance employee stock ownership plans.
SOURCE. IDD Information Services.
Issuance and Yields
Evidence of reduced credit availability can be
seen both in the volume of issuance of belowinvestment-grade private placements and in spreads
between yields on investment-grade and belowinvestment-grade private bonds. Gross issuance by
below-investment-grade, nonfinancial corporations
fell more than 50 percent in 1991, a much steeper
drop than that by investment-grade corporations
(table 2).9 As a percentage of gross offerings,
below-investment-grade issuance declined from
16 percent in 1990 to 9 percent in 1991. Although
data for 1992 are not yet available, preliminary
information suggests that the low volume of lowgrade issuance persisted last year.
Information available since 1990 from a survey
of major life insurance companies by the American
Council of Life Insurance (ACLI) confirms the
decline in gross issuance of low-grade private
placements and points to a significant restructuring
in the composition of life insurers' holdings of
private placements.10 Although total commitments
to purchase private placements remained roughly
constant from early 1990 through mid-1992,
the proportion of below-investment-grade issues
dropped sharply in the middle of 1990 and declined
further in the second half of 1991 (chart 5). Over
9. Gross issuance excludes offerings to finance employee stock
ownership plans (ESOPs) and restructurings. Underlying developments are more evident with their exclusion, as both were heavy in
1989 but fell off sharply in 1990 and 1991.
10. Respondents to the survey hold approximately two-thirds of
all private placements in the general accounts of life insurance
companies.
84
Federal Reserve Bulletin • February 1993
5. N e w commitments to purchase below-investmentgrade private placements as a percentage of total new
commitments by major life insurance companies,
1990-921
6. Yield spreads on privately placed corporate
bonds, 1 9 9 0 - 9 2 : Q 2 [
Percent
Difference between BB spread and BBB spread
1990
1991
250
19922
1. Data are semiannual.
2. 1992:H2 is July at a semiannual rate.
SOURCE. American Council of Life Insurance.
200
150
the entire period, the share of below-investmentgrade securities in total commitments fell from
15 percent to 3 percent.
The reduced rate of gross purchases indicated by
the survey is also evident in insurance companies'
holdings of below-investment-grade securities.
Holdings of such securities at all life insurers
fell 11 percent in 1991, while holdings of
investment-grade securities rose nearly 12 percent.
As a result, speculative-grade private bonds as a
percentage of all private placements in insurance
company portfolios declined from 19.8 percent in
1990 to 16.4 percent in 1991. The low rates of
commitments to purchase below-investment-grade
private issues reported in the 1992 ACLI surveys
suggest that the insurance industry pared holdings
further last year.
Accompanying the decline in gross issuance and
outstandings has been a sharp increase in yield
spreads on below-investment-grade private placements. According to market reports, before 1990
the difference between yields on BB (below investment grade) private placements and BBB (investment grade) private placements, otherwise having
comparable terms, was about 100 basis points;
since then, the difference has been as high as 250
basis points. Although data are unavailable for
periods before 1990, the relative movement in
yields on private bonds rated BB and BBB is
1. Data are quarterly weighted averages.
SOURCE. American Council of Life Insurance.
confirmed in the spreads reported in the ACLI
survey (chart 6).11 During the first half of 1990, the
spread between yields on BB private placements
and comparable Treasury securities was about 300
basis points, compared with 190 basis points on
BBB private placements. From that point, the
spread on BB bonds moved up to almost 425 basis
points in the second quarter of 1991, although in
the second quarter of 1992 it retreated to around
350 basis points. During the same period, the BBB
spread drifted down to 180 basis points. Similarly,
11. Care must be used in interpreting the reported spreads.
Although they are transaction prices, they do not reflect a standardized security. The nonprice terms of private placements can differ
widely for bonds carrying the same credit rating, and the terms
affect the yields. For example, in early 1992, the difference in
spreads between the highest-risk BB issue and the lowest-risk BB
issue reportedly was as much as 150 basis points. Under normal
circumstances, averaging spreads within a rating category produces
a representative spread for that rating. However, as most of the BB
bonds issued since mid-1990 probably were at the least risky end of
that risk range, the increase in the BB spread shown in chart 6
likely understates the actual increase.
Recent Developments in the Market for Privately Placed Debt
the spread on A-rated private placements varied
little over the past three years.12
Sources of the Credit
Crunch
The combination of a decline in gross issuance of
below-investment-grade private placements and an
increase in spreads over Treasuries since mid-1990
is consistent with a decrease in the supply of loanable funds to this sector. Although the demand for
funds surely declined with the falloff in general
economic activity during the period, the increase in
spreads in this market segment indicates that a
much greater reduction occurred in the supply of
funds.
A contraction in supply, however, does not necessarily imply a credit crunch, as credit availability
can decrease and lending terms tighten for many
reasons, sifch as an increase in the riskiness of
borrowers. In general, a credit crunch occurs when,
for a given price of credit, lenders substantially
reduce the volume of credit provided to a group of
borrowers whose risk is essentially unchanged.
That is, a credit crunch is caused by a reduction in
lenders' willingness to make risky investments or
by a "flight to quality" by lenders. A credit crunch
always involves a reduction in the supply of credit;
it does not necessarily involve an increase in interest rates paid by borrowers, because a reduction in
the volume of lending may be accomplished by
nonprice rationing.
This definition of a credit crunch does not
include a reduction in supply that is a response to a
recession or an economic slowdown. In such circumstances, the riskiness of borrowers normally
increases. Lenders demand compensation either in
the form of higher interest rates or tighter nonprice
terms of loans. Although borrowers may characterize such a reduction in credit supply as a credit
crunch, such a characterization is not appropriate
12. In the public high-yield bond market, spreads increased
sharply from mid-1989 through 1990 but have since fallen significantly, although they remain above the levels that prevailed in early
1989. Issuance of public junk bonds stopped almost completely
during 1990 and most of 1991 but surged in 1992 to the second
highest level ever. Thus, experience in the public junk bond market
has been significantly different from that in the market for belowgrade private debt.
85
because the decrease in credit is a normal response
of lenders to changing economic conditions.13
A credit crunch can occur for several reasons. It
may result from actions taken by regulators that
affect lenders' ability or incentive to assume certain risks. It may also result from internal developments at lending institutions, such as unexpectedly
large loan losses, that cause portfolio rebalancings
involving greater conservatism in lending. For
lenders that are financial intermediaries, a credit
crunch may result from concerns of liability holders about the intermediaries' financial condition.
The ability of intermediaries to raise funds to support their investment activity may be adversely
affected in such circumstances, leading to their
adoption of more conservative investment strategies to restore public confidence.
All these reasons appear to have played a role in
the withdrawal of life insurance companies from
the below-investment-grade sector of the private
placement market. The regulatory change, which
was adopted by the National Association of Insurance Commissioners (NAIC) in June 1990 and
became effective at the end of that year, introduced
finer distinctions in the NAIC's credit ratings of
corporate bonds, including private placements.
Under the old rating system, many securities, especially public bonds, with credit quality equivalent
to BB or B received an investment-grade rating. To
correct this shortcoming, the NAIC adopted a rating system with categories more closely aligned
with those in the public market (table 3). Although
insurers' actual holdings were probably little
changed, the reclassification resulting from the
new system caused insurers' reported holdings of
below-investment-grade bonds, both private and
public, to rise from 15 percent of total bond holdings to 21 percent between 1989 and 1990. The
level of reported holdings of high-yield bonds
jumped more than 40 percent.
13. Some economic theories and empirical studies suggest that a
significant amount of nonprice rationing of credit occurs even
during normal times and that this rationing becomes much more
extensive during economic downturns as borrower risk increases.
The increase in nonprice rationing is sometimes referred to as a
credit crunch. Such a mechanism may have operated to reduce
credit availability in the private market during the period of interest
here, but it is different and probably less important in explaining
recent experience in the below-investment-grade segment of the
private market than the reduction in lenders' willingness to bear
risk.
86
3.
Federal Reserve Bulletin • February 1993
NAIC credit ratings
NAIC rating designation
Equivalent ratingagency designation
Old system1
Yes
No*
No**
No
AAA to B
BB, B
CCC or lower
In or near default
New system 2
1
2
3
4
5
6
AAA to A
BBB
BB
B
CCC or lower
In or near deafult
1. The asterisks appended to the "No" ratings are part of the rating
designation.
2. Effective December 31, 1990.
SOURCE. Securities Valuation Office, National Association of Insurance
Commissioners.
The sudden appearance of a much increased
percentage of below-investment-grade securities on
the balance sheets of life insurance companies
focused the attention of policyholders and other
holders of insurance company liabilities on the
composition of insurers' bond holdings. As evidence of increased public sensitivity, a recent study
found that stock prices of insurance companies
with high concentrations of junk bonds were
adversely affected in early 1990 by the publicity
surrounding the financial problems of First Executive Corporation, whose insurance units subsequently failed because of losses on junk bonds. In
contrast, stock prices of insurance companies with
little exposure to junk bonds were not affected.14
The public's greater sensitivity to the quality of life
insurance companies' assets discouraged many insurers from purchasing lower-quality private placements out of fear that they might lose insurance
business to competitors with lower proportions of
below-investment-grade bonds in their portfolios.15
High proportions of poorly performing commercial mortgages in insurance company portfolios are
14. See George Fenn and Rebel Cole, "Announcement of AssetQuality Problems and Stock Returns: The Case of Life Insurance
Companies," in Proceedings of the 28th Annual Conference on
Bank Structure and Competition (Federal Reserve Bank of Chicago, 1992), pp. 818-42.
15. Another regulatory change raised reserves held against some
below-investment-grade bonds and lowered reserves on bonds rated
A or higher. Also, the time allowed to reach the mandatory reserve
levels was shortened. Of the two regulatory changes, the new
structure of ratings likely had the greater effect on insurance
companies' willingness to hold below-investment-grade bonds
because many companies had sufficient reserves to meet the fully
phased-in standards.
another factor causing the reduced availability of
credit to below-investment-grade borrowers. Commercial mortgages make up 25 percent of general
account assets at the twenty largest insurance companies, which include most of the major participants in the private placement market. Additional
exposure to commercial real estate risk comes from
direct real estate investments, which at many life
insurance companies consist primarily of real
estate-related limited partnerships. Delinquency
and foreclosure rates on these commercial real
estate investments have risen sharply over the past
two years, as the press has widely reported. These
problems have further heightened public awareness
of the financial problems of life insurance companies and have thus added to the pressure on those
with significant holdings of commercial real estate
loans to shift out of all lower-quality assets. Also,
because even sound commercial real estate loans
have turned out to be riskier than anticipated at the
time they were made, life insurance companies
have shifted investments toward high-quality
assets.
A final development pressuring insurance companies to restrict purchases of below-investmentgrade private placements has been the concern of
credit rating agencies about the lack of liquidity of
private placements, especially below-investmentgrade ones. This concern appears to be a consequence of the July 1991 collapse of Mutual Benefit
Life Insurance Company, which lacked the liquidity needed to meet heavy redemptions by policyholders. Driven by a fear of being downgraded,
insurance companies have sought more liquidity in
their bond portfolios by concentrating on highergrade credits, which are more readily sold in the
secondary market.
The individual importance of these three factors
as causes of the credit crunch is hard to isolate,
although all three certainly contributed. They are,
however, interrelated. For example, the new NAIC
rating system probably would have had a much
smaller effect if insurance companies had not experienced problems with commercial real estate
loans. Furthermore, the new rating system, combined with the failure of First Executive, served to
focus public attention on the potential riskiness of
below-investment-grade private placements. In any
case, the main impetus behind the credit crunch has
been a perception by life insurance companies that
Recent Developments in the Market for Privately Placed Debt
liability holders might lose confidence in them and
redeem insurance policies, annuities, and guaranteed investment contracts.
Outlook and Alternative
Sources of Credit
As a group, life insurance companies are not likely
to resume investing in below-investment-grade
private placements at pre-1990 levels until their
asset problems have improved and public concern
about the health of the industry has diminished
appreciably. As this improvement hinges mainly on
a recovery of the commercial real estate market,
many analysts expect that insurers will remain
reluctant to provide funds to the low-grade sector
of the private market for the foreseeable future.
This prospect has already led some insurers to
cut staff and fo reduce resources devoted to credit
evaluation and monitoring. If the cutbacks become
widespread, the long-run ability of the insurance
industry to supply credit to medium-sized, belowinvestment-grade companies could be severely
impaired.
Risk-based capital standards, which become
effective at the end of 1993, could reinforce the
reluctance of insurance companies to buy belowinvestment-grade securities. The new standards are
aimed at measuring the prudential adequacy of
insurers' capital as a means of distinguishing
between weakly capitalized and strongly capitalized companies. To this end, insurance companies
will report the ratios of their book capital to levels
of capital that are adjusted for risk. As an insurer's
ratio falls progressively below one, successively
stronger regulatory actions will be triggered.
In the current environment, most insurers will
probably attempt to achieve ratios in excess of one.
One way insurers can raise their risk-based capital
ratios is to shift into low-risk assets. In this regard,
below-investment-grade securities carry risk
weights much higher than those on investmentgrade bonds and even commercial mortgages. Over
time, however, as the financial condition of insurance companies improves and public concern about
their health recedes, insurers will be more inclined
to consider risk-adjusted returns in reaching investment decisions and thus may allocate a greater
proportion of assets to higher-risk categories, such
as below-investment-grade bonds.
87
Despite the almost three-year absence of insurance companies from the below-investment-grade
sector and the persistence of high spreads, other
institutions have not picked up much of the slack.
New lenders must bear the costs of investment in
credit analysis capabilities. Startup costs may
account for the failure of pension funds to fill the
gap, even though their demands for long-term,
fixed-rate investments appear to make them natural
investors in private placements. Few funds currently have the staff of credit analysts needed
to support significant lending in the belowinvestment-grade private market. Most pension
funds also are reluctant to make long-term investments in a market with which they are unfamiliar.
Another way for pension funds as well as others
not currently investing in private placements to
enter the market is through managed investment
funds. Although several funds have been formed in
the past two years, they are not likely to expand to
a scale sufficient to fill the void left by the insurance companies, in part because pension fund managers are reportedly reluctant to invest even indirectly in a market with which they are unfamiliar.
Insurance companies, which would be the primary
source of the managerial resources necessary for
operation of managed private placement funds,
have thus far not set up funds on a large scale, even
though some companies currently have excess
capacity to analyze and monitor lower-quality credits. Some of them are unwilling to make a longterm commitment of resources to this effort
because they expect to eventually resume investing
in below-investment-grade private placements for
their own accounts. Also, most institutional investors expect insurance companies acting as investment managers to purchase some of the securities
for their own accounts. Such a requirement lessens
the incentive to establish managed funds because
of insurers' current aversion to purchasing belowinvestment-grade bonds.
Nor have other institutions appreciably stepped
up their lending in the below-investment-grade sector of the private market. Finance companies' participation has traditionally been in the highest-risk
segment of the market, a segment in which life
insurance companies are not generally active.
Insurers typically made unsecured loans, mainly to
the highest-quality speculative-grade borrowers. In
contrast, finance companies specialize in secured
88
Federal Reserve Bulletin • February 1993
lending, normally with equity features attached.
Thus, the risk-return profile of the typical insurance
company borrower does not suit finance companies, nor would such borrowers generally find
finance companies' terms attractive.
Confronted with few opportunities to borrow in
the private market, below-investment-grade companies have turned to various alternatives. Some have
elected to borrow from banks, even though bank
loans are imperfect substitutes for private placements because of their shorter maturities and floating interest rates. By doing so, these companies
have forgone the opportunity to refinance shorterterm debt with longer-term private placements, and
some have also found that banks have significantly
tightened terms. Other low-rated companies have
issued equity, taking advantage of favorable stock
market conditions in 1991 and early 1992. In some
cases, the improved financial condition resulting
from equity injections has raised issuers' credit
ratings to investment grade, giving them renewed
access to the private bond market.16 The public
junk bond market, despite its revival in the latter
half of 1991, has not been a source of funds for the
typical below-investment-grade private issuer,
which is generally too small and too complex a
credit for the public market.
EFFECT OF RULE 144A ON THE
PRIVATE PLACEMENT MARKET
The adoption of Rule 144A by the SEC in April
1990 paved the way for the development of a new
market for private debt that is much more like the
public bond market than the older or traditional
private placement market.17 Rule 144A permits
unrestricted secondary trading of private placements among sophisticated institutional investors,
designated in the rule as qualified institutional buyers (QIBs). As a general matter, sellers of outstand-
16. Some analysts have suggested that a new rating system for
private placements recently introduced by Standard and Poor's
(S&P) may permit some marginal companies to achieve an
investment-grade rating. In contrast to many other rating schemes,
S&P's new system considers covenant protection in assigning a
rating.
17. Rule 144A applies to both debt and equity securities; however, the discussion deals only with debt securities.
ing private placements must take steps to ensure
that the sales do not indirectly constitute a public
offering, which would violate the basis for the
exemption from registration with the SEC. Under
Rule 144A, QIBs are not viewed as being a part of
the public, and thus they can freely trade private
placements among themselves. This treatment of
QIBs made it clear that securities firms could
underwrite new issues of private placements, as
long as the securities were sold to QIBs. Before the
adoption of Rule 144A, private placements were
not underwritten, as the underwriters' sales of the
securities to investors might have been interpreted
as a public distribution.
In the aftermath of Rule 144A, securities firms
have begun to underwrite private placements on a
firm commitment basis, sparking the development
of the new 144A market. More specifically, the
ability to underwrite private placements means that
for the first time debt can be distributed in the
private market much as it has been in the public
market. Consequently, "public-like" borrowers
with a desire to avoid public registration now have
an alternative to both the public market and the
traditional private market. The emergence of the
144A market thus bridges a gap between the public
and private markets, providing a more efficient
means for large borrowers that do not have the
informational problems of the typical issuer of
private debt to issue in the private market.
The SEC's purposes in adopting Rule 144A were
twofold. One purpose was to increase market
liquidity. The other was to draw more foreign issuers to the private placement market by increasing
liquidity and thus lowering the differential between
private and public interest rates. Foreign companies had not been frequent issuers in public markets primarily because they found the registration
requirements expensive and burdensome, especially the stipulation that financial statements be
reconciled with generally accepted accounting principles in the United States.18 Although foreign
companies have long been able to bypass these
obstacles by issuing debt in the private market,
18. Despite appearances, the burden of registration and disclosure requirements may not be as great as perceived by many
potential foreign issuers. See Charles E. Engros, Jr., "United States
Private Placements," (client memorandum, Lord Day & Lord,
Barrett Smith, New York, N.Y., January 1992), pp. 5-9.
Recent Developments in the Market for Privately Placed Debt
they had not done so to any great extent, in part
because of the higher yields on private placements.
The negotiation of terms and frequent inclusion of
restrictive covenants in private debt also made the
private market unattractive to foreign companies.
The SEC justified the removal of the resale
restrictions on trades between QIBs on the grounds
that the Congress had never considered sophisticated, institutional investors to need the protection
offered by the registration of securities. Rather, the
purpose of registration was to protect unsophisticated, individual investors. The SEC therefore concluded that if secondary transactions involved only
sophisticated investors, such transactions would not
constitute a public distribution and thus could be
carried out without restriction.19
As defined in Rule 144A, QIBs are financial
institutions, corporations, and partnerships owning
and investing qn a discretionary basis at least
$100 million in securities.20 The scope of this
definition is broad enough to include life insurance
companies, pension funds, investment companies,
foreign and domestic banks, master and collective
bank trusts, and savings and loan associations.
Besides meeting the securities test, banks and savings and loans must have net worth of at least
$25 million, a condition imposed by the SEC
because it believed that securities holdings alone
did not necessarily reflect the appropriate degree
of investor sophistication for institutions having
insured deposits.21 In contrast to other institutional
investors, broker-dealers must own only $10 million of securities to qualify as a QIB. The SEC
opted for the lower level to avoid excluding a
significant number of broker-dealers that were
actively participating in the private market.22
19. U.S. Securities and Exchange Commission, SEC Docket, 42
(November 1988), pp. 97-102.
20. Bank deposit notes and certificates of deposit, loan participations, repurchase agreements, and currency and interest rate swaps
are excluded. When Rule 144A was adopted, the SEC also
excluded U.S. government and agency securities, but amendments
to the rule in October 1992 removed this exclusion.
21. U.S. Securities and Exchange Commission, "Resale of
Restricted Securities; Changes to Method of Determining Holding
Period of Restricted Securities under Rules 144 and 145: Final
Rule, Rule Amendments and Solicitation of Comments" (April 23,
1990), pp. 17-20.
22. SEC, "Resale of Restricted Securities," p. 21.
89
Besides requiring that transactions be confined to
QIBs, Rule 144A stipulates that three other conditions must be met. First, to ensure the availability
of a minimal amount of information, an issuer must
provide buyers with copies of its recent financial
statements and basic information about its business. Second, when issued, privately placed securities must not be of the same class as any of the
issuer's securities already traded on a U.S. stock
exchange or on the NASDAQ system. This requirement is intended to prevent the development of an
institutional market in publicly traded securities.
Third, the seller of 144A securities must take "reasonable steps" to inform the buyer that the sale is
occurring pursuant to Rule 144A.
Size of the 144A
Market
The 144A market is still developing and consequently is small compared with the traditional private market and, especially, the public bond market. In 1991, the first full year Rule 144A was in
place, gross issuance of 144A securities was
$17 billion, representing about 20 percent of the
volume in the traditional market (table 4). 23 Offerings were up significantly from roughly $2 billion
in 1990, but, of course, the rule was in effect only
for part of that year, and time was required to bring
issues to market after its adoption. Preliminary
press reports suggest that the volume of issuance
perhaps doubled during the first half of 1992; in
contrast, non-144A issuance was down significantly during that period.24
23. These data include all securities issued using the documentation for a financing pursuant to Rule 144A. As a consequence, both
underwritten and non-underwritten private placements are included
in the data. Unfortunately, the two cannot be separated, although it
is the underwritten securities that primarily constitute the new
144A market. Market estimates of underwritten offerings for 1991
go as high as more than $3 billion. See Michael Vachon, "Underwritten Issues Could Spur Expansion of the Rule 144A Market,"
Investment Dealers' Digest, vol. 58 (January 6, 1992), pp. 13-14.
The pace of underwritten offerings was reportedly much faster in
1992, with one estimate placing the volume during the first half of
1992 at $2.5 billion. See Victoria Keefe, "Underwritten 144A
Deals Surge," Corporate Financing Week, vol. 18 (August 31,
1992), pp. 1 and 10.
24. Michael Vachon, "Too Much Cash, Too Few Deals," Investment Dealers' Digest, vol. 58 (August 31, 1992), pp. 23-24.
90
4.
Federal Reserve Bulletin • February 1993
Gross issuance of debt in public and private markets,
1989-91
Billions of dollars
Market
1989
,990
135
20
Public bonds
189
9
llipi ^
,991
2
*
17
6
95
16
76
13
204
15
307
20
Rule 144A private placements ..
By foreign issuers
Traditional private placements ..
By foreign issuers
|
* Less than $500 million.
SOURCE. IDD Information Services.
Characteristics
of 144A
Securities
Underwritten offerings of 144A securities now
have many of the features of publicly offered
bonds. The terms and documents generally conform to the standards used in the public market; in
particular, the bonds have "public style" covenants, which are fewer in number and considerably
less restrictive than those found in many traditional
private placements. Many components of issuance
costs are the same as those in a public offering,
although the issuer does avoid the considerable
expense associated with public registration. Underwritten 144A securities also have two credit ratings, are not highly structured, and are usually
transferred through the book-entry system operated
by the Depository Trust Company. In many
instances, offering memoranda have been styled to
be similar to prospectuses used in public offerings.
This procedure has been followed primarily as a
part of the underwriters' efforts to market the private placements to traditional public-market investors, such as mutual funds, pension funds, and
groups within insurance companies that invest in
public bonds.25 The average size of underwritten
private placements has been comparable to that of
public offerings. Finally, the terms of the securities
are not negotiated with investors but are set before
the offering.
Despite the similarity to public bonds, underwritten 144A securities as a group still differ from
public bonds, especially with regard to liquidity,
and thus their yields on average contain a pre-
25. See Vachon, "Too Much Cash," pp. 23-24.
mium.26 In the first year of the market, the premium was reported to be about the same as that on
traditional private placements. Recent reports suggest, however, that the liquidity of 144A securities
has increased and that the premium has decreased
as major dealers have allocated capital and traders
to making markets for 144A securities.27
Foreign
Issuers
Thus far, foreign issuance has made up a much
larger proportion of the 144A market than it has of
either the traditional private or public bond markets. Of the $16.7 billion of 144A offerings in
1991, foreign companies or their U.S. subsidiaries
were responsible for about one-third (table 4). In
contrast, foreign issuers placed only 16 percent of
offerings in the traditional private market, and only
7 percent of public offerings were foreign related.
Preliminary data for the first half of 1992 suggest
that foreign issuance likely made up an even larger
share of the 144A market last year.28
Several factors appear to lie behind foreign use
of the 144A market. One is that the adoption of
Rule 144A itself served to publicize the already
existing advantages of the private placement market to foreign companies. The effect of the rule has
thus been to alter foreigners' perception that all
offerings in the United States were subject to excessive regulatory burdens. Moreover, since adoption
of the rule, investment banks have devoted more
effort to bringing foreign issuers into the private
market. A second factor boosting foreign issuance
has been the low level of yields in the United States
relative to European countries. The 1992 increase
in foreign issuance in the public bond market to a
record level attests to the yield advantage of U.S.
26. Some additional reasons for the premium are that lenders
typically demand a slightly higher rate from foreign issuers and
also from first-time issuers.
27. See Keefe, "Underwritten 144A Deals Surge," p. 10.
28. The foreign share of the 144A market could be higher than
indicated because the data do not always list U S . subsidiaries of
foreign corporations as foreign issuers. Other sources of information, in fact, give foreign issuers a larger share of the 144A market.
See Moody's Investors Service, "Recent Developments in the
144A Private Placement Market: A Rating Agency Perspective,"
Moody's Special Comment (New York, N.Y., February 1992) and
U.S. Securities and Exchange Commission, "Staff Report on Rule
144A" (September 30, 1991).
Recent Developments in the Market for Privately Placed Debt
markets. A final factor is that the premium in yields
on foreign bonds issued in the private market has
reportedly declined.
Domestic
Issuers
Although foreign use of the 144A market has
received considerable attention, domestic issuance
has also been significant. In 1991, U.S. companies
accounted for about two-thirds of the volume, and
they likely maintained their presence in 1992.
Domestic issuers in the 144A market typically
are larger companies with special circumstances
that preclude issuing in the public bond market. In
some cases, the companies are not registered with
the SEC and do not want to incur the time and
expense required to register securities. Among
these are private companies that, in the past, have
borrowed in the traditional private market but now
find more favorable pricing and terms in the 144A
market. Also included are unregistered subsidiaries
of publicly registered parents that are issuing debt
in the subsidiaries' names. In other cases, companies with outstanding public securities have turned
to the 144A market to protect the confidentiality of
the specific circumstances leading to the borrowing, or they have highly structured transactions that
are more easily accommodated in the private market. As these examples imply, unless special circumstances are involved, borrowing costs generally are lower in the public bond market.
Investors
In the first year and a half after the adoption of
Rule 144A, life insurance companies made up the
largest single group of investors in 144A private
placements, purchasing nearly 75 percent of all
nonconvertible debt, according to estimates compiled by the SEC. The second largest group of
buyers during this period was mutual funds,
accounting for a little more than 10 percent of the
volume of nonconvertible debt.29 More recently,
29. At the time Rule 144A was adopted, the SEC took deliberate
steps to foster the participation of mutual funds in the 144A market.
One change permitted a family of mutual funds to aggregate the
holdings of all its funds in determining its eligibility as a qualified
91
mutual funds have reportedly invested more,
whereas the share of life insurance companies has
diminished.30
The changing role of mutual funds and life insurance companies is consistent with press reports that
buyers of 144A securities are increasingly those
that have traditionally invested primarily in public
bonds, such as mutual funds and those groups in
insurance companies that specialize in purchasing
public bonds.31 The 144A market is attractive to
public-market investors because it offers corporate
bonds that are similar to public issues and because
it offers bonds issued by foreign corporations. In
addition, yields are higher on 144A private placements than those on comparable public issues,
although, as noted, this premium exists mainly to
compensate investors for the lesser liquidity and
other unique characteristics of private placements.
Despite these favorable aspects of 144A securities, pension funds, one of the largest groups of
investors in public bonds, have not been significant
buyers of 144A securities. Their absence from the
144A market may result from restrictions on their
ability to purchase foreign securities, as well as
from the lack of familiarity of many fund managers
with the private placement market and the significance of Rule 144A. Also, the SEC initially
excluded bank trusts from its definition of qualified
institutional buyers. In October 1992, however, the
SEC amended the definition to include trusts managing employee benefit plans, which may increase
the participation of pension funds.
In contrast to the interest shown by publicmarket investors in the 144A market, buyers of
traditional private placements are unlikely to find
this market attractive. The comparative advantage
of traditional investors is credit analysis and credit
monitoring, neither of which are required to the
same extent in the 144A market or in the public
market. Market liquidity is of less value to them
because they are generally buy-and-hold investors.
institutional buyer. Also, a fund's board of directors was permitted
to determine whether 144A securities were liquid and thus not
subject to the 10 percent limit on fund holdings of illiquid securities that was then in place. (The limit has since been raised to
15 percent.) Before this authorization, mutual funds were required
to classify all private placements as illiquid securities.
30. "Fund Managers Petition SEC for Share of the 144A
Wealth," Private Placement Reporter (August 10, 1992), p. 6.
31. Vachon, "Too Much Cash," p. 23.stors.
92
Federal Reserve Bulletin • February 1993
Prospects
Further development and growth of the 144A market appear likely because it has filled a gap in U.S.
capital markets. The public corporate bond market
serves large, well-known borrowers that do not
require lenders to perform extensive credit analyses, whereas the traditional private market serves
less well known, medium-sized borrowers that
require extensive credit analysis. Before the adoption of Rule 144A, no market was able to accommodate large issuers wishing to avoid public registration but not requiring extensive credit analysis
by lenders. These issuers, whether domestic or
foreign, were left with no choice (in U.S. markets)
but to accept the terms of the private market, which
included a relatively large yield premium over public bond rates.
The 144A market bridges the gap between the
public and traditional private markets and, in this
sense, is a new bond market. Whether the need for
such a market extends much beyond current levels
of activity is an open question. There is little
prospect that the medium-sized, informationproblematic firms that issue in the traditional mar-
ket will move to the 144A market. Such firms must
borrow from a financial intermediary with the
capacity to undertake substantial credit analysis.
Moreover, they may not want their issues to be
liquid because significant covenants are often
included in traditional private placements, and issuers prefer that such debt remain in the hands of the
original lenders in case the covenants must be
renegotiated.
The greatest potential for the 144A market perhaps lies in its use by foreign issuers inasmuch as
they represent the largest group of borrowers without any previous satisfactory alternative in the
United States. If foreign issuance expands significantly, then Rule 144A could prove instrumental in
further integrating world capital markets as well as
in improving the competitive position of U.S. markets. Borrowing by large, domestic corporations
with specialized requirements seems to offer much
less potential, as such situations are relatively rare
for most large corporations. Nonetheless, some
analysts expect that the public and 144A bond
markets will eventually converge, with yields and
terms being comparable in the two markets.
•
93
Industrial Production and Capacity Utilization
Released for publication
December
109.7 percent of its 1987 annual average, total
industrial production in November was 1.5 percent
above its year-ago level. Total industrial capacity
utilization rose another 0.2 percentage point in
November, to 78.9 percent.
When analyzed by market group, the data show
that the November rise in the output of durable
consumer goods, led by gains in motor vehicles
16
Industrial production rose 0.4 percent in November; with the increase of 0.5 percent in October, the
rise has more than offset the declines of late summer. The most significant increases in the broadly
based November advance were in nondurable materials and information processing equipment. At
Industrial production indexes
Twelve-month percent change
1987
1989
1988
1990
1991
Twelve-month percent change
1992
1987
1988
1989
1990
1991
1992
Capacity and industrial production
Ratio scale, 1987 production = 100
Ratio scale, 1987 production = 100
140
— Manufacturing
Capacity
140
'
120
100
120
-
=
Production
80
1
1
1
1
1
1
1
1
— 80
I
Percent of capacity
1
1
1
Percent of capacity
Manufacturing
Total industry
90
Utilization
90
Utilization
80
80
70
J
1980
I
I
1982
100
1984
1986
I
I
1988
1990
1992
70
1
1980
1
1
1982
1
i
1984
i
i
1986
All series are seasonally adjusted. Latest series, November. Capacity is an index of potential industrial production.
i
i
1988
i
i
1990
i
1992
94
Federal Reserve Bulletin • February 1993
Industrial production and capacity utilization
Industrial production, index, 1987=100'
Percentage change
Category
1992
19922
r
r
r
Aug/
Sept.
Oct.
NOV.P
Aug.
109.7
r
r
Sept.
Oct.
-.2
-.3
.5
-.3
-.2
.3
Total
109.1
108.8
109.3
Previous estimate
109.0
108.7
109.0
Major market groups
Products, total
Consumer goods
Business equipment
Construction supplies
Materials
109.8
110.8
125.9
98.5
108.1
109.3
110.3
125.3
96.8
108.0
110.1
111.0
126.7
97.8
108.1
110.4
111.3
127.4
98.4
108.6
.2
.4
1.2
-.1
-.8
-.4
-.4
-.4
-1.8
-.1
Major industry groups
Manufacturing
Durable
Nondurable
Mining
Utilities
110.1
109.2
111.3
98.8
108.8
109.7
108.2
111.6
98.8
109.1
110.3
109.2
111.6
98.9
108.6
110.8
109.7
112.2
99.5
107.9
-.1
.1
-.4
-1.7
-.5
-.4
-.9
.2
.0
.3
NOV.P
.4
1.5
.7
.6
1.1
1.1
.1
.3
.3
.6
.6
.5
1.3
1.2
4.6
2.6
1.8
.6
1.0
.0
.1
-.5
.5
.4
.5
.6
-.6
2.0
1.8
2.3
-.1
-2.8
MEMO
Capacity utilization, percent
1992
1991
Average,
1967-91
Low,
1982
High,
1988-89
Nov. 1991
to
Nov. 1992
Nov.
Aug.
Sept.'
Oct.'
NOV.P
Capacity,
percentage
change,
Nov. 1991
to
Nov. 1992
Total
82.1
71.8
85.0
79.3
78.8
78.5
78.7
78.9
2.1
Manufacturing
Advanced processing
Primary processing .
Mining
Utilities
81.4
81.0
82.3
87.4
86.7
70.0
71.4
66.8
80.6
76.2
85.1
83.6
89.0
87.2
92.3
78.2
77.1
80.8
86.8
85.9
77.9
76.3
81.7
86.1
83.6
77.4
75.9
81.3
86.1
83.8
77.7
76.2
81.6
86.2
83.3
77.9
76.2
82.4
86.7
82.8
2.4
2.9
1.1
.1
1.0
1. Seasonally adjusted.
2. Change from preceding month.
and furniture, was 0.3 percent; the increase in the
production of nondurable consumer goods was also
0.3 percent. The output of business equipment grew
0.6 percent in November. Within business equipment, the production of information processing
equipment rose nearly 1 percent, after an increase
of 1.7 percent in October, as the output of computers continued to climb. The manufacture of industrial equipment also posted noticeable gains in
November, while the production of defense and
space equipment continued to drop. The overall
output of transit equipment fell; a continued decline
in the production of commercial aircraft and equipment more than offset increases in the output of
vehicles for business use. The production of construction supplies advanced again, a move partly
reflecting gains in the output of lumber. Materials
output grew 0.5 percent in November; the production of nondurable goods materials jumped 1.6 per
r Revised,
p Preliminary.
cent, with notable gains in the output of paper,
textiles, and chemicals.
When analyzed by industry group, the data
show that output in manufacturing increased
0.5 percent in November; the October growth
rate was 0.6 percent. Factory utilization rose
0.2 percentage point in November, to 77.9 percent,
a level about the same as the levels in the second
and third quarters. Gains in operating rates over the
past two months have been the strongest in primary processing industries, where utilization has
increased more than 1 percentage point since
September. Utilization rates for lumber and products, petroleum products, primary metals, rubber
and plastics products, fabricated metal products,
and primary processing chemicals have all
increased nearly 1 percentage point or more. In the
past two months, utilization at advanced processing
industries has increased 0.3 percentage point: The
Industrial Production and Capacity Utilization
rates for motor vehicles and parts, miscellaneous
manufactures, nonelectrical machinery, furniture
and fixtures, and advanced processing chemicals
have posted gains of 1 percent or more since September, but utilization rates in printing and pub-
95
lishing and in the aerospace industry have fallen
sharply.
In November, output at mines, boosted by gains
in oil and gas well drilling, rose 0.6 percent. Production at utilities declined 0.6 percent.
•
96
Announcements
APPOINTMENT OF NEW MEMBERS TO THE
THRIFT INSTITUTIONS ADVISORY COUNCIL
Stephen W. Prough, President and CEO, Western
Financial Savings Bank, Irvine, California.
The Federal Reserve Board announced on December 18, 1992, the names of eight new members of
its Thrift Institutions Advisory Council (TIAC) and
designated a new president of the council for 1993.
The council is an advisory group made up of
twelve representatives from thrift institutions. The
panel was established by the Board in 1980 and
includes representatives of savings and loan associations, savings banks, and credit unions. The council meets at least four times each year with the
Board of Governors to discuss developments relating to thrift institutions, the housing industry, mortgage finance, and certain regulatory issues.
Daniel C. Arnold, Director of the Farm and
Home Financial Corporation, Houston, Texas,
will serve as president for 1993, and Beatrice
D'Agostino, Chairman, President, and CEO, New
Jersey Savings Bank, Somerville, New Jersey, will
serve as vice president.
The eight new members, named for two-year
terms that began January 1, 1993, are the
following:
The other members of the council are the
following:
William A. Cooper, Chairman, and CEO, TCF
Bank Savings FSB, Minneapolis, Minnesota
Paul L. Eckert, Chairman and President, Citizens
Federal Savings Bank, Davenport, Iowa
George R. Gligorea, Chairman, President, and
CEO, First Federal Savings Bank, Sheridan,
Wyoming
Richard D. Jackson, Vice Chairman and CEO,
Georgia Federal Bank FSB, Atlanta, Georgia
Kerry Killinger, Chairman, President, and
CEO, Washington Mutual Savings Bank, Seattle,
Washington
Charles John Koch, President and CEO, Charter
One Bank FSB, Cleveland, Ohio
Robert McCarter, Chairman and CEO, New
Bedford Institution for Savings, New Bedford,
Massachusetts
Thomas J. Hughes, President, Navy Federal
Credit Union, Merrifield, Virginia
Thomas R. Ricketts, Chairman, President, and
CEO, Standard Federal Bank, Troy, Michigan.
ISSUANCE OF NEW REGULATION
F
The Federal Reserve Board issued in final form on
December 17, 1992, a new Regulation F (Limitations on Interbank Liabilities). The final rule implements the interbank liability provisions under
section 308 of the Federal Deposit Insurance Corporation Improvement Act of 1991.
The final rule generally requires banks, savings
associations, and branches of foreign banks with
deposits insured by the Federal Deposit Insurance
Corporation to develop and implement prudential
policies and procedures to evaluate and control
exposure to their correspondent banks.
The rule also establishes a regulatory limit to
require that a bank ordinarily limit its overnight
credit exposure to an individual correspondent that
is less than "adequately capitalized" to not more
than 25 percent of the exposed bank's total capital.
No express regulatory limits are provided for credit
exposure to correspondents that are at least "adequately capitalized," although such exposure is
subject to prudential policies and procedures.
The final rule provides for an extended transition
for implementation of the rule. The requirements
for prudential policies and procedures go into effect
on June 19, 1993. The regulatory limit on credit
exposure to an individual correspondent is phased
in, with the limit set at 50 percent of the exposed
banks's capital for a one-year period beginning on
97
June 19, 1994, and reduced to 25 percent as of
June 19, 1995.
Additional information on the final rule, including a summary of comments, the Regulatory Flexibility Analysis, and the Competitive Impact Analysis, will be published in the Federal Register.
Copies of this material are available on request.
ADOPTION OF FINAL AMENDMENTS AND
GUIDELINES TO REGULATION H
The Federal Reserve Board on December 23,1992,
announced adoption of final amendments and
guidelines to Regulation H (Membership of State
Banking Institutions in the Federal Reserve System) to implement uniform real estate lending standards as mandated by section 304 of the Federal
Deposit Insurance Corporation Improvement Act
of 1991.
The amendments prescribe standards for extensions of credit secured by liens on real estate or
made for the purpose of financing permanent
improvements to real estate.
The standards were developed in consultation
with the Office of the Comptroller of the Currency,
the Office of Thrift Supervision, and the Federal
Deposit Insurance Corporation.
The uniform regulations become effective
March 19, 1993.
MODIFICATIONS OF RISK-BASED CAPITAL
GUIDELINES ON CERTAIN COLLATERALIZED
TRANSACTIONS
The Federal Reserve Board on December 23, 1992,
announced adoption of modifications to its riskbased capital guidelines affecting the treatment of
certain collateralized transactions.
The revised guidelines for state member banks
and bank holding companies lower the risk weight
assigned to such transactions to a level more commensurate with the minimal risks involved.
The revision lowers the risk weight from 20 percent to zero for certain transactions that are collateralized by cash and central government securities
of the Organisation for Economic Co-operation and
Development, including U.S. government agency
securities, provided that the transactions meet specified criteria.
The change is consistent with international bank
capital standards. This rule was effective December 30, 1992.
AMENDMENT TO RISK-BASED CAPITAL
GUIDELINES FOR STATE MEMBER BANKS
AND BANK HOLDING COMPANIES
The Federal Reserve Board on December 23, 1992,
issued an interim rule amending the risk-based
capital guidelines for state member banks and bank
holding companies to lower from 100 percent to
50 percent the risk weight on loans to finance the
construction of one-family to four-family residences that have been presold.
The interim rule amends the Board's Regulation
H (Membership of State Banking Institutions in the
Federal Reserve System) and Regulation Y (Bank
Holding Companies and Change in Bank Control)
and was effective December 29, 1992. The interim
rule will be reviewed by the Board after the
receipt of public comments. Public comments were
requested by January 27, 1993.
The interim rule implements section 618(a) of
the Resolution Trust Corporation Refinancing,
Restructuring, and Improvement Act of 1991.
ISSUANCE OF POLICY STATEMENT ON THE
USE OF LARGE-VALUE FUND TRANSFERS
FOR MONEY LAUNDERING
The Federal Reserve Board issued on December 23, 1992, a policy statement to address the
problem of the use of large-value fund transfers for
money laundering. The statement encourages
financial institutions to include, when possible,
complete information on the sender and recipient
of large payment orders, including those sent
through Fedwire, CHIPS, and SWIFT.
Board action followed adoption of the statement
by the Federal Financial Institutions Examination
Council.
98
Federal Reserve Bulletin • February 1993
REPORTING OF DEFERRED TAX ASSETS BY
BANK HOLDING COMPANIES
The Federal Reserve Board announced on December 23, 1992, that, for regulatory purposes, bank
holding companies should report deferred tax assets
in accordance with Financial Accounting Standards
Board Statement no. 109, "Accounting for Income
Taxes" (FASB 109) beginning in the first quarter
of 1993.1
The Board also indicated that the application of
FASB 109 will be permitted in regulatory reports
of bank holding companies for December 31,1992,
subject to the guidance specified below.
The Board intends to issue for public comment
in the near future proposed amendments to its
risk-based and leverage capital guidelines for
state member banks and bank holding companies that pertain to the treatment of deferred tax
assets in computing the capital positions of these
institutions.
These actions are being taken by the Board to
provide for the treatment of net deferred tax assets
for bank holding companies consistent with provisions set forth by the Federal Financial Institutions
Examination Council for federally supervised
banks and thrift institutions (insured depositories).
On December 8, the council decided that insured
depositories should begin to follow FASB 109 in
1993. In addition, the council stated that insured
depositories could adopt the standard for their
December 1992 regulatory reports, subject to the
limitation that the amount reported not exceed
the limit for net deferred tax assets that it is
recommending to the federal banking and thrift
agencies to incorporate into their regulatory capital
standards.
The recommendations offered by the council to
the agencies are the following:
1. Net deferred tax assets that are dependent on
an institution's future taxable income should be
limited for regulatory capital purposes to the
amount that can be realized within one year of a
1. Deferred tax assets generally arise from temporary differences, that is, items that are reported differently for tax and financial statement purposes. A typical temporary difference arises from
the treatment of loan losses.
quarter-end report date or 10 percent of tier 1
capital, whichever is less.
2. No limit for regulatory capital purposes
should be placed on deferred tax assets that can be
realized from taxes paid in prior carryback years.
The Board has under review a proposal of its
staff to seek public comment on a limitation on
deferred tax assets for capital purposes for state
member banks and bank holding companies, as
recommended by the council. In view of this and
the council's action, the Board strongly urges bank
holding companies to place the same limitation on
the amount of deferred tax assets recorded in their
regulatory reports filed with the Federal Reserve
for the December 31, 1992, reporting date, if they
choose the option of adopting FASB 109 for that
period.
PROPOSED
ACTIONS
The Federal Reserve Board issued for public comment on December 28, 1992, a proposal to amend
Regulation C, which carries out the Home Mortgage Disclosure Act, to incorporate new statutory
provisions. Comments on the proposal were
requested by January 29, 1993.
The Federal Reserve Board on December 31,
1992, also issued for public comment a proposed
amendment to its Regulation K (International
Banking Operations) to implement section 202(a)
of the Foreign Bank Supervision Enhancement Act
of 1991. Comments should be received by
March 5, 1993.
CHANGE IN BOARD
STAFF
The Board announced on January 4, 1993, the
appointment of Donald L. Robinson as Assistant
Inspector General for Investigations in the Office
of Inspector General.
Mr. Robinson has been with the Federal Reserve's Office of Inspector General since 1987. He
has had twenty years of experience as a trained
criminal investigator and manager of investigative
functions. He holds a B.S. from the American
University and is a certified fraud examiner.
Announcements
PUBLICATION OF THE REVISED BANK
HOLDING COMPANY SUPERVISION MANUAL
A revised edition of the Bank Holding Company
Supervision Manual has been published by the
Board and is now available for purchase by the
public. The Manual has been prepared for use by
Federal Reserve examiners in the supervision, regulation, and inspection of bank holding companies
and their subsidiaries. Copies are available to the
public at a price of $50.00 each from Publications
Services, mail stop 138, Board of Governors of the
Federal Reserve System, Washington, DC 20551.
This fee is applicable to both new and existing
subscribers. There will be a separate charge for
future updates.
The revised edition includes updates through
December 1992. Included are changes resulting
99
from the Federal Deposit Insurance Corporation
Improvement Act of 1991 and discussions of such
new topics as environmental liability, options and
other derivative financial contracts, and the sale of
uninsured annuities. Also included are interpretations of and changes made to the risk-based capital
guidelines, credit-supported and asset-backed commercial paper, real estate appraisal and evaluation
programs, higher residual value leasing, fullservice securities brokerage, and expanded financial advisory nonbanking activities approved in
1992. Provided with the Manual is a detailed
description of these and other changes made to the
content and structure of it since the previous
update. The Manual has also been reorganized and
reduced to a six-by-nine-inch page format for ease
of handling. It has been updated at various times
since its original publication in 1980.
•
100
Record of Policy Actions
of the Federal Open Market Committee
MEETING HELD ON NOVEMBER 17, 1992
1. Domestic Policy
Directive
The information reviewed at this meeting suggested that economic activity had been expanding
at a moderate pace. Consumer spending had picked
up somewhat, business purchases of capital equipment continued to rise at a brisk pace, and housing
demand had increased moderately since midyear.
At the same time, part of these demands were being
met through higher imports, and recent gains in
industrial production and employment had been
limited. Incoming data on wages and prices had
been mixed but suggested on balance a continuing
trend toward lower inflation.
Total nonfarm payroll employment rose slightly
in October after declining in August and September. Substantial job gains were recorded in the
services industries, especially in health services
and the cyclically sensitive business services, and
employment in construction rebounded from a September decline. In manufacturing, the number of
jobs declined further in October, although total
hours worked were unchanged as the drop in employment was offset by an increase in overtime.
Government employment continued to contract,
reflecting the end of a federally funded summer
jobs program and early retirements by postal workers. Initial claims fell somewhat during October,
and the civilian unemployment rate edged down to
7.4 percent.
Industrial production rose somewhat further in
October following a modest increase in the third
quarter. Much of the October gain reflected a sharp
rise in light truck assemblies, but there was another
sizable advance in the manufacture of office and
computing equipment. Elsewhere, the production
of consumer goods other than motor vehicles and
parts had changed little in recent months, and the
output of defense and space equipment remained
on a downward trend in October. Utilization of
industrial capacity edged higher in October but was
still near its 1991 low.
Retail sales increased appreciably in September
and October, led by a substantial rise in sales at
automotive dealers. Sales at general merchandisers,
apparel outlets, furniture and appliance stores, and
building materials and supplies centers also were
up noticeably over the two months. Housing starts
rose significantly in August and then edged up
further in September to their highest level since
March. Sales of new homes had increased on balance over recent months, and the inventory of new
homes for sale in September had reached its lowest
level since 1983.
Real outlays for producers' durable equipment
posted another strong increase in the third quarter.
A sharp advance in outlays for computing equipment outweighed a dropoff in aircraft purchases
from an unsustainably high level in the second
quarter. Purchases of items other than aircraft and
computing equipment rose at a rapid rate in the
third quarter, and recent data on orders for such
goods pointed to additional growth in the near
term. Expenditures for nonresidential construction,
which had fluctuated within a narrow range earlier
in the year, dropped sharply in the third quarter.
Office construction registered the largest decline,
but other commercial and industrial building also
fell considerably.
Business inventories rose only slightly in September, but over the third quarter as a whole stocks
grew at the same rate as in the second quarter. In
manufacturing, stocks were drawn down in September, retracing a sizable portion of the runup that
had occurred in August. In most manufacturing
industries, inventory-to-shipments ratios in September were at or near the bottom of their recent
ranges. Wholesale inventories rose modestly in the
third quarter, and the stocks-to-sales ratio in September was at the low end of the range posted over
101
the past year. At the retail level, inventories
rebounded in September from an August decline,
leaving the inventory-to-sales ratio for the retail
sector unchanged from the second quarter.
The nominal U.S. merchandise trade deficit widened sharply in August; for July and August combined, the deficit was somewhat larger than its
average rate in the second quarter. The value of
exports was little changed from the second quarter,
but the value of imports increased appreciably.
Most of the increase in imports was in capital
goods, especially computers, and consumer goods.
Recent indicators suggested that economic activity
in the major foreign industrial countries had
remained sluggish in the third quarter. A recovery
seemed to have gotten under way in Canada, but
the economies of most European countries and
Japan evidenced little if any forward impetus, and
the downturn that began in western Germany in the
second quarter appeared to have persisted into the
third quarter.
Producer prices of finished goods edged up in
October, reflecting a slight increase in food prices
and a further sharp advance in prices of energy
products. Excluding the finished food and energy
components, producer prices declined slightly, and
for the twelve-month period ended in October, this
measure of prices increased considerably less than
it had in the comparable year-earlier period. At the
consumer level, prices of nonfood, non-energy
goods and services advanced more rapidly in October than in other any month since March. Over the
twelve months ended in October, however, the rise
in this index of consumer prices was considerably
smaller than that recorded in the year-earlier
period. Increases in labor costs, measured by the
total hourly compensation of private industry workers, slowed further in the third quarter, and both the
wage and benefits components of this index had
increased substantially less over the four quarters
that ended in September than in the preceding four
quarters.
At its meeting on October 6, the Committee
adopted a directive that called for maintaining the
existing degree of pressure on reserve positions and
that included a marked bias toward possible easing
during the intermeeting period. Accordingly, the
directive indicated that in the context of the Committee's long-run objectives for price stability and
sustainable economic growth, and giving careful
consideration to economic, financial, and monetary
developments, slightly greater reserve restraint
might be acceptable or slightly lesser reserve
restraint would be acceptable during the intermeeting period. The contemplated reserve conditions
were expected to be consistent with growth in M2
and M3 at annual rates of about 2 percent and
1 percent respectively over the three-month period
from September through December.
Open market operations during the intermeeting
period were directed toward maintaining the existing degree of pressure on reserve positions. The
emergence of more favorable indications regarding
the performance of the economy and the continued
more rapid expansion of money and credit were
seen as obviating the need to implement an easing
in reserve conditions that had been contemplated as
a strong possibility under the directive issued at
the October 6 meeting. Several small technical
decreases were made during the intermeeting
period to expected levels of adjustment plus seasonal borrowing to reflect the usual pattern of
diminishing needs for seasonal credit. Actual borrowing averaged close to expected levels over the
three reserve maintenance periods completed since
the October meeting. Early in the intermeeting
period, the federal funds rate exhibited some of the
firmness that had prevailed over most of the previous period, but subsequently it averaged close to
expected levels.
Most other interest rates increased appreciably
over the intermeeting period. At the beginning of
the period, rates generally incorporated an expected
near-term easing of monetary policy. Subsequently,
when an easing move was not forthcoming and
when concerns about fiscal stimulus increased amid
some signs of firmer economic activity and increasing money and credit demands, market interest
rates rose for all maturities. The largest increases
were in intermediate maturities, which were especially affected by expectations of additional federal
borrowing and of a stronger economy that would
stimulate rising private credit demands over the
next few years. Expectations of firmer economic
growth also boosted stock prices appreciably over
the period.
With interest rates rising in the United States and
falling abroad, the trade-weighted value of the
dollar in terms of the other G-10 currencies rose
very substantially over the intermeeting period.
102
Federal Reserve Bulletin • February 1993
Declines in interest rates in foreign countries were
widespread, reflecting signs of greater economic
weakness as well as actual or prospective easing in
monetary policies abroad. The dollar was particularly robust against European currencies but
advanced only moderately against the yen.
M2 growth strengthened somewhat in October
from its pace in the two previous months. The
acceleration of M2 growth reflected more rapid
expansion of its transaction components that
appeared to be associated in part with the lagged
effect of earlier declines in market interest rates
and opportunity costs and the heavy pace of mortgage refinancing activity. M3 grew more slowly in
October partly owing to reduced needs for managed liabilities in conjunction with somewhat
weaker expansion in bank credit. Through October,
both broad aggregates were estimated to have
grown at rates a little below the lower ends of the
ranges established for the year by the Committee.
The staff projection prepared for this meeting
suggested a continuing expansion in economic
activity. Growth was expected to pick up gradually
over 1993 to a rate that, although quite moderate by
past cyclical standards, would be sufficient to
reduce the margins of unemployed labor and capital resources. The recent backup in long-term
interest rates and the appreciation of the dollar
in foreign exchange markets would exert some
restraining influence over the next several quarters.
Continuing cautiousness on the part of consumers
facing uncertain job and income prospects would
tend to hold down gains in consumption for some
period ahead. But, as further progress was made in
improving household balance sheets and employment growth gradually resumed, consumer spending would strengthen. Additional gains in outlays
for business equipment were expected over coming
quarters as firms sought to meet increasing demand
for goods and to respond to competitive pressures
by modernizing product lines and achieving laborcost savings. The projection pointed to sluggish
export demand in light of sustained economic
weakness abroad. While recognizing the possibility
of a stimulative fiscal initiative in 1993, the staff
retained for this forecast the assumption employed
in several previous forecasts that fiscal policy
would remain mildly restrictive owing in large part
to a substantial decline in defense spending. The
persisting slack in resource utilization over the
forecast horizon was expected to be associated with
additional progress in reducing inflation.
In the Committee's discussion of current and
prospective economic developments, the members
indicated that they were encouraged by the somewhat more positive tone in the latest economic
reports and by the signs of improving business and
consumer confidence. The expansion appeared to
have gathered somewhat more upward momentum
than many had anticipated earlier, though a number
of members commented that relatively slow economic growth was likely to persist over the nearer
term. The outlook beyond the next quarter or two
was subject to considerable uncertainty and indeed
to both upside and downside risks. The advent of a
new Administration and a new Congress early next
year made fiscal policy especially hard to predict.
Members observed that indications of some
improvement in overall domestic demands, should
they persist, might well generate considerable
strengthening in production activity as businesses
attempted to maintain or build up their currently
lean inventories. On the other hand, the recent
appreciation of the dollar and the signs of growing
weakness in major foreign economies could have
adverse implications for demands for goods produced in the United States. On balance, moderate
but sustained growth in overall economic activity
was seen as a likely prospect, though the gains
probably would be uneven both in terms of their
timing and the sectors of the economy that would
be affected. Against this background, the members
generally continued to view further progress toward
price stability as a reasonable expectation and an
important element in enabling the expansion to be
sustained.
In their review of developments in key sectors of
the economy, the members generally agreed that
while the evidence of a strengthening business
expansion was still quite limited and much of it
was still anecdotal, there were growing indications
of improving business and consumer confidence.
Some members cautioned that changing attitudes
alone could not be relied on as harbingers of a
more satisfactory economic performance, as experience in recent years made clear, but the improved
financial condition of many business firms, households, and lending institutions provided a further
basis for optimism. A good deal of progress already
had been made toward reducing debt burdens, and
Record of Policy Actions of the Federal Open Market Committee
the retarding effects of balance sheet adjustments
on current spending seemed likely to lessen over
the forecast horizon. Moreover, despite many lingering problems, the general health of the banking
industry had improved markedly and there were
spreading reports of greater efforts by banks to find
creditworthy borrowers. At the same time, the
members saw signs that demands for bank loans
might be picking up a bit from very depressed
levels.
The latest data on retail sales and anecdotal
reports from many parts of the country suggested
some improvement in consumer spending. There
were widespread reports of increasing optimism
among retailers regarding the outlook for sales
during the holiday season. Sales of automobiles
and trucks appeared to be rising. The members
nonetheless generally continued to view the outlook for consumer spending with considerable
caution. Consumers remained concerned about job
prospects against the background of continuing
downsizing and restructuring activities by many
business firms. Ongoing efforts to reduce debt burdens also seemed to be exerting a retarding effect
on consumer spending. Against this background,
the upturn in consumer confidence indicated by a
recent survey could prove to be relatively fragile
and short-lived. On balance, a strengthening trend
in consumer spending, though to a relatively moderate pace by past business recovery standards, was
still expected to provide major support for a sustained economic expansion.
Since the stimulus from the consumer sector
coincided with relatively lean inventories, its
effects might well be reinforced for a time by
business efforts to build their inventories. Business
spending for equipment also appeared likely to
remain fairly robust, given a moderate expansion in
sales and the improving financial condition of
many businesses. The housing sector was viewed
as another potential, though limited, source of stimulus over the forecast horizon. There were reports
of improving home sales and home construction
activity in many parts of the country, including
some otherwise depressed areas, and many business contacts also were seeing better demand for
construction materials and home furnishings. On
the negative side, nonresidential construction
remained weak across much of the nation, and
further reductions in construction activity were
103
likely as major projects were completed. However,
nonresidential construction was being maintained
or even trending higher in a few areas and appeared
to have bottomed out in others. The rise in natural
gas prices had spurred drilling activity in recent
months, but some members commented that the
outlook for significant further gains in that industry
was not promising.
Many of the members stressed that the external
sector constituted a major source of downside risk
for the economy. The economic prospects for major
foreign economies appeared to have deteriorated
recently, and given the appreciation of the dollar,
net exports might well worsen further over the next
several quarters. The possible failure of ongoing
trade negotiations would further dampen the outlook for U.S. trade. For the present, anecdotal
reports from around the country on export sales
were mixed, with such sales still well maintained in
some industries and areas but slowing in others.
The outlook for fiscal policy constituted a major
source of uncertainty; while the enactment of some
fiscal policy measures now appeared to be increasingly likely, there was no reliable way to predict
their overall size, specific provisions, or the timing
of their effects. For now, the downtrend in federal
government purchases of goods and services constituted a sizable negative in the forecast of aggregate demands. In particular, the cutbacks in defense
expenditures were having a major effect on local
economies in several parts of the country. Any new
fiscal initiatives might well contain some stimulative elements designed to provide a boost to a
relatively slow economic expansion. However, the
delays usually encountered in enacting such legislation together with the subsequent lags before much
of the effects were felt in the economy implied
continued fiscal drag during the quarters immediately ahead; moreover, the propensity for financial
markets to raise interest rates in anticipation of
fiscal policy stimulus might also damp spending
for some period. Some members saw a risk that
much of the fiscal stimulus would be felt at a time
when economic activity might already be gaining
considerable momentum.
Turning to the outlook for inflation, members
commented that despite a disappointing report on
consumer prices for October, the disinflationary
trend still appeared to be well established. In the
view of most members, the outlook for relatively
104
Federal Reserve Bulletin • February 1993
subdued pressures on resources over the forecast
horizon together with the slow growth over an
extended period in broad measures of money
augured well for further progress toward price stability. Members were continuing to observe strong
competitive pressures in local markets, and business contacts were still emphasizing the stout resistance that they encountered when they tried to raise
prices to widen profit margins or to pass along
rising costs. Most businessmen currently saw and
anticipated little or no inflation in their own industries. Consumers also remained highly price conscious. At the same time, however, there seemed to
be a widespread view in the business community
and among consumers that at some point the rate of
inflation was likely to rise appreciably from its
recent level, and such expectations tended to have
adverse repercussions in long-term debt markets
and to create tensions in wage negotiations and
other price-setting activities. Members noted that
current inflationary expectations had been built up
over a period of many years and an extended
period of reduced inflation probably would be
required before they disappeared.
At this meeting, the Committee had a preliminary discussion of the ranges for monetary growth
in 1993 that it had established on a tentative basis
at the meeting on June 30-July 1,1992. The ranges
in question had been set at 2Vi to 6Vi percent for
M2 and 1 to 5 percent for M3 and were unchanged
from those adopted for 1992. While there had been
considerable sentiment at midyear in favor of lowering the ranges, a majority of the members had
concluded then that uncertainties about the prospective relationship between the monetary aggregates and nominal spending argued for caution in
making any changes. The information since midyear had confirmed the persistence of sizable
increases in the velocity of M2 and M3. A recent
staff study had provided some reasons for this
unusual behavior, and staff analysis pointed to a
strong probability that velocity would rise again
next year.
During the discussion, the members generally
agreed that developments since mid-1992 had reinforced the case for some reduction in the 1993
range for M2, and they indicated that they probably
would support proposals for a lower range. Such a
reduction would be a technical adjustment intended
to take account of the atypical strength in velocity.
Some noted that a lower range also would be seen
as underscoring the desire of the Committee to
avoid any pickup in inflation should the expansion
gain momentum and indeed as promoting further
progress toward price stability, thereby establishing
a sounder basis for sustained growth in the economy at its highest potential. The ranges would
be voted on in February before their scheduled
announcement to the Congress, and by that time
more information would be available to gauge the
prospective behavior of M2 during 1993.
In the Committee's discussion of policy for the
intermeeting period ahead, a majority of the
members indicated a preference for maintaining
unchanged conditions in reserve markets, but several others believed that some easing would be a
more appropriate policy. Members who supported
a steady policy course emphasized the growing
if still tentative indications of a strengthening
economy—including the pickup in money and
credit growth—and the apparent upturn in business
and consumer confidence. Some also cited the
increased prospects of fiscal policy measures that
were likely to provide some net stimulus to the
economy over the intermediate term. Members who
preferred to ease monetary policy at this time
referred to what they viewed as an unsatisfactory
outlook for economic activity, and some stressed
the desirability of taking prompt action to promote
sustained growth in the broader monetary aggregates within the Committee's ranges. Members
who favored an immediate easing also endorsed
coupling such a policy move with a reduction at
this time in the tentative M2 range for 1993 in
order to emphasize the Committee's commitment
to noninflationary economic growth.
In the course of the discussion, the members
took account of a staff analysis that suggested some
moderation in the growth of M2 over the remainder
of the year, assuming unchanged conditions in
reserve markets. While M2 growth on a quarterly
average basis was expected to be stronger in the
current quarter than in the previous two quarters,
expansion for the year as a whole was still projected to fall a little below the Committee's annual
range. Some members commented that an important policy objective would be to prevent M2
growth from faltering—such a development might
parallel a similar pause in the economy—as it had
earlier in the current expansion. On the other hand,
Record of Policy Actions of the Federal Open Market Committee
some members noted the persisting increases in M2
velocity. They remarked that the level of short-term
interest rates together with the very rapid expansion in Ml and reserves pointed to an adequate
availability of liquidity in the economy and thus
suggested that current monetary policy already was
appropriately stimulative and properly positioned
to support the projected strengthening in economic
activity. Indeed, in one view, continued rapid
expansion in the narrrow measures of money and
reserves, if allowed to continue, would be a matter
of increasing concern with respect to the longer-run
implications for inflation.
In the Committee's discussion of possible adjustments to policy during the intermeeting period,
many of the members expressed a preference for a
directive that did not bias potential adjustments in
either direction. In this view, the expansion was on
a reasonably solid footing, the risks to the expansion were now fairly evenly balanced, and a steady
policy course should be maintained in the absence
of unanticipated developments with significant
implications for the economic outlook. Other members, while encouraged by recent economic developments, wanted to bias the directive toward ease,
though without the strong presumption of some
potential easing that had been associated with the
previous directive. They observed that the economy was still expanding at a relatively subdued
pace, inflation was on a downward track, and given
the earlier tendency for the recovery to weaken,
they believed that the Committee should react relatively promptly to indications, including any downturn in money growth, that the economy might
again be falling short of a moderate growth path.
Most of the members who preferred to ease immediately indicated that they could accept an
unchanged directive that was biased toward ease,
and such a directive also was acceptable to many
members who favored a symmetrical directive.
At the conclusion of the Committee's discussion,
all but three of the members indicated their acceptance of a directive that called for maintaining the
existing degree of pressure on reserve positions and
that would include some bias toward possible easing during the intermeeting period. Two of the
members expressed a strong preference for a symmetric directive with regard to possible intermeeting policy adjustments, while another was firmly
persuaded of the desirability of an immediate
105
increase in reserve availability to strengthen the
growth of M2. Accordingly, in the context of the
Committee's long-run objectives for price stability
and sustainable economic growth, and giving careful consideration to economic, financial, and monetary developments, the Committee decided that
slightly greater monetary restraint might be acceptable or slightly lesser monetary restraint would be
acceptable during the intermeeting period. The
reserve conditions contemplated at this meeting
were expected to be consistent with growth in M2
and M3 at annual rates of about V/2 and 1 percent
respectively over the three-month period from September through December.
At the conclusion of the meeting, the following
domestic policy directive was issued to the Federal
Reserve Bank of New York:
The information reviewed at this meeting suggests
that economic activity has been expanding at a moderate
pace. Total nonfarm payroll employment was up slightly
in October after declining in the previous two months,
and the civilian unemployment rate edged down to
7.4 percent. Industrial production rose somewhat in
October. Retail sales increased considerably in September and October. There was some strengthening in residential construction activity over the summer months.
Outlays for business equipment have continued to
increase, and recent data on orders for nondefense capital goods point to further growth in the near term;
expenditures for nonresidential construction have
remained weak. The nominal U.S. merchandise trade
deficit widened somewhat in July-August from its average rate in the second quarter. Recent data on wages and
prices have been mixed but suggest on balance a continuing trend toward lower inflation.
Most interest rates have increased appreciably since
the Committee meeting on October 6. In foreign
exchange markets, the trade-weighted value of the dollar
in terms of the other G-10 currencies rose very substantially over the intermeeting period.
M2 has expanded at a moderate pace since midsummer, with all of its growth stemming from its Ml component, while M3 grew slowly. Through October, both
aggregates were estimated to have grown at rates a little
below the lower ends of the ranges established by the
Committee for the year.
The Federal Open Market Committee seeks monetary
and financial conditions that will foster price stability
and promote sustainable growth in output. In furtherance
of these objectives, the Committee at its meeting on
June 30-July 1 reaffirmed the ranges it had established
in February for growth of M2 and M3 of 2Vi to 6V2 percent and 1 to 5 percent respectively, measured from the
fourth quarter of 1991 to the fourth quarter of 1992. The
Committee anticipated that developments contributing to
106
Federal Reserve Bulletin • February 1993
unusual velocity increases could persist in the second
half of the year. The monitoring range for growth of total
domestic nonfinancial debt also was maintained at AVi to
8V2 percent for the year. For 1993, the Committee on a
tentative basis set the same ranges as in 1992 for growth
of the monetary aggregates and debt, measured from the
fourth quarter of 1992 to the fourth quarter of 1993. The
behavior of the monetary aggregates will continue to be
evaluated in the light of progress toward price level
stability, movements in their velocities, and developments in the economy and financial markets.
In the implementation of policy for the immediate
future, the Committee seeks to maintain the existing
degree of pressure on reserve positions. In the context of
the Committee's long-run objectives for price stability
and sustainable economic growth, and giving careful
consideration to economic, financial, and monetary
developments, slightly greater reserve restraint might or
slightly lesser reserve restraint would be acceptable in
the intermeeting period. The contemplated reserve conditions are expected to be consistent with growth of M2
and M3 over the period from September through
December at annual rates of about 3Vi and 1 percent,
respectively.
time was needed to evaluate the effects of prior
monetary policy actions, and they were concerned
that the adoption of a more stimulative policy over
the near term might well establish a basis for
greater inflation later. Mr. Melzer was concerned
that rapid growth in total bank reserves, the monetary base, and Ml over the past two years might
already have laid a foundation for accelerating
nominal GDP growth and a reversal of the disinflationary trend. In addition, he noted that policy
errors can easily be made at this stage of the
business cycle. In an economic expansion, efforts
to resist increases in the federal funds rate through
large reserve injections eventually lead to higher
inflation and higher nominal interest rates.
Votes for this action: Messrs. Greenspan, Corrigan,
Angell, Hoenig, Kelley, Lindsey, Mullins, Ms. Phillips, and Mr. Syron. Votes against this action: Messrs.
Jordan, LaWare, and Melzer.
The Committee approved a temporary increase of
$3 billion, to a level of $11 billion, in the limit on
changes between Committee meetings in System
Account holdings of U.S. government and federal
agency securities. The increase amended paragraph 1(a) of the Authorization for Domestic Open
Market Operations and was effective for the intermeeting period ending with the close of business
on December 22, 1992.
Mr. Jordan dissented because he preferred taking
immediate action to increase the availability of
bank reserves sufficiently to raise M2 growth to a
pace more consistent with the Committee's annual
range. Because desirable M2 expansion in line with
the Committee's objectives would be likely to fall
within a lower range next year, he would announce
concurrently a reduction in the 1993 range to make
clear that near-term action to increase M2 expansion was not an abandonment of the long-term
objective of noninflationary monetary growth.
Messrs. LaWare and Melzer dissented because
they did not want to bias the directive toward
possible easing during the intermeeting period. In
their view, recent developments pointed to a
strengthening economy, and they favored a steady
policy that was not predisposed to react to nearterm weakness in economic or monetary data. More
2. Authorization for Domestic
Open Market
Operations
Votes for this action: Messrs. Greenspan, Corrigan,
Angell, Hoenig, Jordan, Kelley, LaWare, Lindsey,
Melzer, Mullins, Ms. Phillips, and Mr. Syron. Votes
against this action: None.
The Manager of the System Open Market
Account advised the Committee that the current
leeway of $8 billion for changes in System Account
holdings might not be sufficient to accommodate
the potentially large need to add reserves over the
intermeeting period ahead to meet an anticipated
seasonal bulge in the demand for currency and
required reserves.
•
107
Legal Developments
FINAL RULE—REGULATION
F
The Board of Governors is publishing a new 12 C.F.R.
Part 206, its Regulation F (Interbank Liabilities). The
final rule implements section 308 of the Federal Deposit Insurance Corporation Improvement Act of 1991
(FDICIA), which requires the Board to prescribe
standards to limit the risks posed by exposure of
insured depository institutions to other depository
institutions. The final rule applies to banks, savings
associations, and branches of foreign banks with deposits insured by the Federal Deposit Insurance Corporation (FDIC).
The final rule generally requires insured banks,
savings associations, and branches of foreign banks,
referred to collectively as "banks," to develop and
implement internal prudential policies and procedures
to evaluate and control exposure to the depository
institutions with which they do business, referred to as
"correspondents.''
The rule also establishes a general "limit" stated in
terms of the exposed bank's capital, for overnight
"credit exposure" to an individual correspondent, as
defined in the rule. Under the rule, a bank ordinarily
should limit its credit exposure to an individual correspondent to an amount equal to not more than
25 percent of the exposed bank's total capital, unless
the bank can demonstrate that its correspondent is at
least "adequately capitalized." No limit is specified by
the rule for credit exposure to correspondents that are
at least "adequately capitalized," but a bank is required to establish and follow its own internal policies
and procedures with regard to exposure to all correspondents, regardless of capital level.
The final rule provides for a thirty-month transition
period after the effective date for full implementation
of the rule. Banks must have in place the internal
policies and procedures required by the rule on
June 19, 1993. The regulatory limit on credit exposure to correspondents that a bank cannot demonstrate are at least "adequately capitalized" will be
phased in, with the limit set at 50 percent of the
exposed bank's capital for a one-year period beginning on June 19, 1994, and reduced to 25 percent as
of June 19, 1995.
Effective December 19, 1992, 12 C.F.R. Part 206 is
added to read as follows:
Part 206—Limitations on Interbank Liabilities
Section
Section
Section
Section
Section
Section
Section
206.1—Authority, purpose, and scope.
206.2—Definitions.
206.3—Prudential standards.
206.4—Credit exposure.
206.5—Capital levels of correspondents.
206.6—Waiver.
206.7—Transition provisions.
Authority: Section 308 of Pub. L. 102-242, 105 Stat.
2236, 12 U.S.C. 371b-2.
Section 206.1—Authority, purpose, and scope.
(a) Authority and purpose. This part (Regulation F,
12 C.F.R. Part 206) is issued by the Board of Governors of the Federal Reserve System (Board) to implement section 308 of the Federal Deposit Insurance
Corporation Improvements Act of 1991 (Act),
12 U.S.C. 371b-2. The purpose of this part is to limit
the risks that the failure of a depository institution
would pose to insured depository institutions.
(b) Scope. This part applies to all depository institutions insured by the Federal Deposit Insurance Corporation.
Section 206.2—Definitions.
As used in this part, unless the context requires
otherwise:
(a) Bank means an insured depository institution, as
defined in section 3 of the Federal Deposit Insurance
Act (12 U.S.C. 1813), and includes an insured national
bank, state bank, District bank, or savings association,
and an insured branch of a foreign bank.
(b) Commonly-controlled correspondent means a correspondent that is commonly controlled with the bank
and for which the bank is subject to liability under
section 5(e) of the Federal Deposit Insurance Act. A
correspondent is considered to be commonly controlled with the bank if:
(1) 25 percent or more of any class of voting securities of the bank and the correspondent are owned,
directly or indirectly, by the same depository institution or company; or
108
Federal Reserve Bulletin • February 1993
(2) Either the bank or the correspondent owns 25
percent or more of any class of voting securities of
the other.
(c) Correspondent means a U.S. depository institution
or a foreign bank, as defined in this part, to which a
bank has exposure, but does not include a commonly
controlled correspondent.
(d) Exposure means the potential that an obligation
will not be paid in a timely manner or in full. "Exposure" includes credit and liquidity risks, including
operational risks, related to intraday and interday
transactions.
(e) Foreign bank means an institution that:
(1) Is organized under the laws of a country other
than the United States;
(2) Engages in the business of banking;
(3) Is recognized as a bank by the bank supervisory
or monetary authorities of the country of the bank's
organization;
(4) Receives deposits to a substantial extent in the
regular course of business; and
(5) Has the power to accept demand deposits.
(f) Primary federal supervisor has the same meaning as
the term "appropriate Federal banking agency" in
section 3(q) of the Federal Deposit Insurance Act
(12 U.S.C. 1813(q)).
(g) Total capital means the total of a bank's Tier 1 and
Tier 2 capital under the risk-based capital guidelines
provided by the bank's primary federal supervisor.
For an insured branch of a foreign bank organized
under the laws of a country that subscribes to the
principles of the Basle Capital Accord, "total capital"
means total Tier 1 and Tier 2 capital as calculated
under the standards of that country. For an insured
branch of a foreign bank organized under the laws of a
country that does not subscribe to the principles of
the Basle Capital Accord, "total capital" means total
Tier 1 and Tier 2 capital as calculated under the
provisions of the Accord.
(h) U.S. depository institution means a bank, as defined in section 206.2(a) of this part, other than an
insured branch of a foreign bank.
Section 206.3—Prudential standards.
(a) General. A bank shall establish and maintain written policies and procedures to prevent excessive exposure to any individual correspondent in relation to
the condition of the correspondent.
(b) Standards for selecting correspondents.
(1) A bank shall establish policies and procedures
that take into account credit and liquidity risks,
including operational risks, in selecting correspondents and terminating those relationships.
(2) Where exposure to a correspondent is significant, the policies and procedures shall require periodic reviews of the financial condition of the correspondent and shall take into account any
deterioration in the correspondent's financial condition. Factors bearing on the financial condition of
the correspondent include the capital level of the
correspondent, level of nonaccrual and past due
loans and leases, level of earnings, and other factors
affecting the financial condition of the correspondent. Where public information on the financial
condition of the correspondent is available, a bank
may base its review of the financial condition of a
correspondent on such information, and is not required to obtain non-public information for its review. However, for those foreign banks for which
there is no public source of financial information, a
bank will be required to obtain non-public information for its review.
(3) A bank may rely on another party, such as a bank
rating agency or the bank's holding company, to
assess the financial condition of or select a correspondent, provided that the bank's board of directors has reviewed and approved the general assessment or selection criteria used by that party.
(c) Internal limits on exposure.
(1) Where the financial condition of the correspondent and the form or maturity of the exposure create
a significant risk that payments will not be made in
full or in a timely manner, a bank's policies and
procedures shall limit the bank's exposure to the
correspondent, either by the establishment of internal limits or by other means. Limits shall be consistent with the risk undertaken, considering the financial condition and the form and maturity of exposure
to the correspondent. Limits may be fixed as to
amount or flexible, based on such factors as the
monitoring of exposure and the financial condition
of the correspondent. Different limits may be set for
different forms of exposure, different products, and
different maturities.
(2) A bank shall structure transactions with a correspondent or monitor exposure to a correspondent,
directly or through another party, to ensure that its
exposure ordinarily does not exceed the bank's
internal limits, including limits established for credit
exposure, except for occasional excesses resulting
from unusual market disturbances, market movements favorable to the bank, increases in activity,
operational problems, or other unusual circumstances. Generally, monitoring may be done on a
retrospective basis. The level of monitoring required
depends on:
(i) The extent to which exposure approaches the
bank's internal limits;
Legal Developments
(ii) The volatility of the exposure; and
(iii) The financial condition of the correspondent.
(3) A bank shall establish appropriate procedures to
address excesses over its internal limits.
(d) Review by board of directors. The policies and
procedures established under this section shall be
reviewed and approved by the bank's board of directors at least annually.
Section 206.4—Credit exposure.
(a) Limits on credit exposure.
(1) The policies and procedures on exposure established by a bank under section 206.3(c) of this part
shall limit a bank's interday credit exposure to an
individual correspondent to not more than 25 percent of the bank's total capital, unless the bank can
demonstrate that its correspondent is at least adequately capitalized, as defined in section 206.5(a) of
this part.
(2) Where a bank is no longer able to demonstrate
that a correspondent is at least adequately capitalized for the purposes of section 206.4(a) of this part,
including where the bank cannot obtain adequate
information concerning the capital ratios of the
correspondent, the bank shall reduce its credit exposure to comply with the requirements of section
206.4(a)(1) of this part within 120 days after the date
when the current Report of Condition and Income or
other relevant report normally would be available.
(b) Calculation of credit exposure. Except as provided
in sections 206.4(c) and (d) of this part, the credit
exposure of a bank to a correspondent shall consist of
the bank's assets and off-balance sheet items that are
subject to capital requirements under the capital adequacy guidelines of the bank's primary federal supervisor, and that involve claims on the correspondent or
capital instruments issued by the correspondent. For
this purpose, off-balance sheet items shall be valued
on the basis of current exposure. The term "credit
exposure" does not include exposure related to the
settlement of transactions, intraday exposure, transactions in an agency or similar capacity where losses
will be passed back to the principal or other party, or
other sources of exposure that are not covered by the
capital adequacy guidelines.
(c) Netting. Transactions covered by netting agreements that are valid and enforceable under all applicable laws may be netted in calculating credit exposure.
(d) Exclusions. A bank may exclude the following from
the calculation of credit exposure to a correspondent:
(1) Transactions, including reverse repurchase
agreements, to the extent that the transactions are
secured by government securities or readily market
109
able collateral, as defined in paragraph (f) of this
section, based on the current market value of the
collateral;
(2) The proceeds of checks and other cash items
deposited in an account at a correspondent that are
not yet available for withdrawal;
(3) Quality assets, as defined in paragraph (f) of this
section, on which the correspondent is secondarily
liable, or obligations of the correspondent on which
a creditworthy obligor in addition to the correspondent is available, including but not limited to:
(i) Loans to third parties secured by stock or debt
obligations of the correspondent;
(ii) Loans to third parties purchased from the
correspondent with recourse;
(iii) Loans or obligations of third parties backed
by stand-by letters of credit issued by the correspondent; or
(iv) Obligations of the correspondent backed by
stand-by letters of credit issued by a creditworthy
third party ;
(4) Exposure that results from the merger with or
acquisition of another bank for one year after that
merger or acquisition is consummated; and
(5) The portion of the bank's exposure to the correspondent that is covered by federal deposit insurance.
(e) Credit exposure of subsidiaries. In calculating
credit exposure to a correspondent under this part, a
bank shall include credit exposure to the correspondent of any entity that the bank is required to consolidate on its Report of Condition and Income or Thrift
Financial Report.
(f) Definitions. As used in this section:
(1) Government securities means obligations of, or
obligations fully guaranteed as to principal and
interest by, the United States government or any
department, agency, bureau, board, commission, or
establishment of the United States, or any corporation wholly owned, directly or indirectly, by the
United States.
(2) Readily marketable collateral means financial
instruments or bullion that may be sold in ordinary
circumstances with reasonable promptness at a fair
market value determined by quotations based on
actual transactions on an auction or a similarly
available daily bid- and ask-price market.
(3) (i) Quality asset means an asset:
(A) That is not in a nonaccrual status;
(B) On which principal or interest is not more
than thirty days past due; and
(C) Whose terms have not been renegotiated or
compromised due to the deteriorating financial
condition of the additional obligor.
(ii) An asset is not considered a "quality asset" if
110
Federal Reserve Bulletin • February 1993
any other loans to the primary obligor on the asset
have been classified as "substandard," "doubtful," or "loss," or treated as "other loans specially mentioned" in the most recent report of
examination or inspection of the bank or an
affiliate prepared by either a federal or a state
supervisory agency.
Section 206.5—Capital levels of
correspondents.
(a) Adequately capitalized correspondents.l For the
purpose of this part, a correspondent is considered
adequately capitalized if the correspondent has:
(1) A total risk-based capital ratio, as defined in
paragraph (e)(1) of this section, of 8.0 percent or
greater;
(2) A Tier 1 risk-based capital ratio, as defined in
paragraph (e)(2) of this section, of 4.0 percent or
greater; and
(3) A leverage ratio, as defined in paragraph (e)(3) of
this section, of 4.0 percent or greater.
(b) Frequency of monitoring capital levels. A bank
shall obtain information to demonstrate that a correspondent is at least adequately capitalized on a quarterly basis, either from the most recently available
Report of Condition and Income, Thrift Financial
Report, financial statement, or bank rating report for
the correspondent. For a foreign bank correspondent
for which quarterly financial statements or reports are
not available, a bank shall obtain such information on
as frequent a basis as such information is available.
Information obtained directly from a correspondent
for the purpose of this section should be based on the
most recently available Report of Condition and Income, Thrift Financial Report, or financial statement
of the correspondent.
(c) Foreign banks. A correspondent that is a foreign
bank may be considered adequately capitalized under
this section without regard to the minimum leverage
ratio required under paragraph (a)(3) of this section.
(d) Reliance on information. A bank may rely on
information as to the capital levels of a correspondent
obtained from the correspondent, a bank rating
agency, or other party that it reasonably believes to be
accurate.
(e) Definitions. For the purposes of this section:
(1) Total risk-based capital ratio means the ratio of
qualifying total capital to weighted risk assets.
1. As used in this part, the term "adequately capitalized" is similar
but not identical to the definition of that term as used for the purposes
of the prompt corrective action standards. See, e.g., 12 C.F.R. Part
208, Subpart B.
(2) Tier 1 risk-based capital ratio means the ratio of
Tier 1 capital to weighted risk assets.
(3) Leverage ratio means the ratio of Tier 1 capital to
average total consolidated assets, as calculated in
accordance with the capital adequacy guidelines of
the correspondent's primary federal supervisor.
(f) Calculation of capital ratios.
(1) For a correspondent that is a U.S. depository
institution, the ratios shall be calculated in accordance with the capital adequacy guidelines of the
correspondent's primary Federal supervisor.
(2) For a correspondent that is a foreign bank
organized in a country that has adopted the riskbased framework of the Basle Capital Accord, the
ratios shall be calculated in accordance with the
capital adequacy guidelines of the appropriate supervisory authority of the country in which the
correspondent is chartered.
(3) For a correspondent that is a foreign bank
organized in a country that has not adopted the
risk-based framework of the Basle Capital Accord,
the ratios shall be calculated in accordance with the
provisions of the Basle Capital Accord.
Section 206.6—Waiver.
The Board may waive the application of section
206.4(a) of this part to a bank if the primary federal
supervisor of the bank advises the Board that the bank
is not reasonably able to obtain necessary services,
including payment-related services and placement of
funds, without incurring exposure to a correspondent
in excess of the otherwise applicable limit.
Section 206.7—Transition provisions.
(a) Beginning on June 19, 1993, a bank shall comply
with the prudential standards prescribed under section
206.3 of this part.
(b) Beginning on June 19, 1994, a bank shall comply
with the limit on credit exposure to an individual
correspondent required under section 206.4(a) of this
part, but for a period of one year after this date the
limit shall be 50 percent of the bank's total capital.
FINAL RULE—AMENDMENTS
HAND
Y
TO
REGULATIONS
The Board of Governors is amending 12 C.F.R. Parts
208 and 225, its Regulations H and Y (Capital and
Capital Adequacy Guidelines), for state member banks
and bank holding companies to include the European
Bank for Reconstruction and Development (EBRD),
the International Finance Corporation (IFC), and the
Legal Developments
Nordic Investment Bank (NIB) in the list of named
multilateral lending institutions that are eligible for a
20 percent risk weight. This modification would conform the Board's risk-based capital guidelines more
closely to interpretive guidance adopted by the other
G-10 countries that are signatories to the Basle Accord.
Effective December 22, 1992, 12 C.F.R. Parts 208
and 225 are amended as follows:
Part 208—Membership of State Banking
Institutions in the Federal Reserve System
111
agencies and claims on, and the portions of claims
guaranteed by, the International Bank for Reconstruction and Development (World Bank), the
International Finance Corporation, the Interamerican Development Bank, the Asian Development
Bank, the African Development Bank, the European Investment Bank, the European Bank for
Reconstruction and Development, the Nordic Investment Bank, and other multilateral lending
institutions or regional development banks in
which the U.S. government is a shareholder or
contributing member.* * *
1. The authority citation for part 208 is revised to read
as follows:
Authority: Sections 9, 11(a), 11(c), 19, 21, 25, and 25(a)
of the Federal Reserve Act, as amended (12 U.S.C.
321-338, 248(a), 248(c), 461, 481-486, 601 and 611,
respectively); sections 4, 13(j), and 18(o) of the Federal Deposit Insurance Act, as amended (12 U.S.C.
1814, 1823(j), and 1828(o), respectively); section 7(a)
of the International Banking Act of 1978 (12 U.S.C.
3105); sections 907-910 of the International Lending
Supervision Act of 1983 (12 U.S.C. 3906-3909); sections 2, 12(b), 12(g), 12(i), 15B(c) (5), 17, 17A, and 23
of the Securities Exchange Act of 1934 (15 U.S.C.
78b, 781(b), 781(g), 781(i), 78o-4(c) (5), 78q, 78q-l, and
78w, respectively); section 5155 of the Revised Statutes (12 U.S.C. 36) as amended by the McFadden Act
of 1927; and sections 1101-1122 of the Financial Institutions Reform, Recovery, and Enforcement Act of
1989 (12 U.S.C. 3310 and 3331-3351).
2. Appendix A to part 208 is amended by revising the
second sentence of the second paragraph in III.C.2 to
read as follows:
APPENDIX A TO PART
208—CAPITAL
ADEQUACY
GUIDELINES FOR STATE MEMBER
BANKS: RISK-BASED
MEASURE
Uj * * *
(2 * * *
2. * * * In addition, this category also includes
claims on, and the portions of claims that are
guaranteed by, U.S. government-sponsored32
32. For this purpose, U.S. government-sponsored agencies are
defined as agencies originally established or chartered by the federal
government to serve public purposes specified by the U.S. Congress
but whose obligations are not explicitly guaranteed by the full faith and
credit of the U.S. government. These agencies include the Federal
Part 225—Bank Holding Companies
Change in Bank Control
and
1. The authority citation for part 225 is revised to read
as follows:
Authority: 12 U.S.C. 1817(j) (13), 1818(b), 1828(o),
183li, 1843(c) (8), 1844(b), 1972(1), 3106, 3108, 3907,
3909, 3310, 3331-3351, and section 306 of the Federal
Deposit Insurance Corporation Improvement Act of
1991 (Pub. L. 102-242, 105 Stat. 2236 (1991)).
2. Appendix A to part 225 is amended by revising the
second sentence of the second paragraph in III.C.2 to
read as follows:
APPENDIX A TO PART
ADEQUACY GUIDELINES
COMPANIES: RISK-BASED
225—CAPITAL
FOR BANK
HOLDING
MEASURE
UJ * * *
£ * **
2. * * * In addition, this category also includes
claims on, and the portions of claims that are
guaranteed by, U.S. government-sponsored 35
Home Loan Mortgage Corporation (FHLMC), the Federal National
Mortgage Association (FNMA), the Farm Credit System, the Federal
Home Loan Bank System, and the Student Loan Marketing Association (SLMA). Claims on U.S. government-sponsored agencies include capital stock in a Federal Home Loan Bank that is held as a
condition of membership in that Bank.
35. For this purpose, U.S. government-sponsored agencies are
defined as agencies originally established or chartered by the federal
government to serve public purposes specified by the U.S. Congress
but whose obligations are not explicitly guaranteed by the full faith and
credit of the U.S. government. These agencies include the Federal
Home Loan Mortgage Corporation (FHLMC), the Federal National
Mortgage Association (FNMA), the Farm Credit System, the Federal
Home Loan Bank System, and the Student Loan Marketing Association (SLMA). Claims on U.S. government-sponsored agencies in-
112
Federal Reserve Bulletin • February 1993
agencies and claims on, and the portions of claims
guaranteed by, the International Bank for Reconstruction and Development (World Bank), the
International Finance Corporation, the Interamerican Development Bank, the Asian Development
Bank, the African Development Bank, the European Investment Bank, the European Bank for
Reconstruction and Development, the Nordic Investment Bank, and other multilateral lending
institutions or regional development banks in
which the U.S. government is a shareholder or
contributing member.* * *
FINAL RULE—AMENDMENT
TO REGULATION
O
The Board of Governors is amending 12 C.F.R. Part
215, its Regulation O (Loans to Executive Officers,
Directors, and Principal Shareholders of Member
Banks; Loans to Holding Companies and Affiliates) to
implement recent amendments to section 22(h) of the
Federal Reserve Act, contained in the Housing and
Community Development Act of 1992. The revision
will provide that loans to a holding company parent
and its affiliates are not subject to Regulation O
inasmuch as these transactions are governed by section 23A of the Federal Reserve Act.
Effective December 17, 1992, 12 C.F.R. Part 215 is
amended as follows:
Part 215—Loans to Executive Officers,
Directors, and Principal Shareholders of
Member Banks
1. The authority citation for part 215 is revised to read
as follows:
Section 215.2—Definitions
(1)(1) Principal shareholder means a person (other than
an insured bank) that directly or indirectly, or acting
through or in concert with one or more persons,
owns, controls, or has the power to vote more than
10 percent of any class of voting securities of a
member bank or company. Shares owned or controlled by a member of an individual's immediate
family are considered to be held by the individual.
(2) A principal shareholder of a member bank includes:
(i) A principal shareholder of a company of which
the member bank is a subsidiary, and
(ii) A principal shareholder of any other subsidiary of that company.
(3) A principal shareholder of a member bank does
not include a company of which a member bank is a
subsidiary.
FINAL RULE—AMENDMENT
TO REGULATION
The Board of Governors is amending 12 C.F.R. Part
225, its Regulation Y (Bank Holding Companies and
Change in Bank Control) to implement certain regulatory improvements contained in sections 202(d) and
210 of the Federal Deposit Insurance Corporation
Improvement Act of 1991 (FDICIA). The final rule
specifies additional factors that the Federal Reserve
System must consider in acting on applications by
bank holding companies to acquire banks under section 3 of the Bank Holding Company Act. The intended effect of the amendment is to conform the
Board's regulations to the statutory changes.
Effective February 4, 1993, 12 C.F.R. Part 225 is
amended as follows:
Authority: Sections ll(i), 22(g) and 22(h), Federal
Reserve Act (12 U.S.C. 248(i), 375a, 375b(7)), 12
U.S.C. 1817(k)(3) and 1972(2)(F)(vi), and section 955
of the Housing and Community Development Act of
1992 (Pub. L. 102-550, 106 Stat. 3895 (1992)).
Part 225—Bank Holding Companies
Change in Bank Control
Subpart A—Loans by Member Banks to Their
Executive Officers, Directors, and Principal
Shareholders
Section 225.2—Definitions.
2. Section 215.2 is amended by revising paragraph (1)
to read as follows:
elude capital stock in a Federal Home Loan Bank that is lield as a
condition of membership in that Bank.
Y
and
1. Section 225.2 is amended by revising the text of
paragraph (k) as follows:
(k)(l) Controlling shareholder means a person that
owns or controls, directly or indirectly, 25 percent
or more of any class of voting securities of a bank or
other company.
(2) Principal shareholder means a person that owns
or controls, directly or indirectly, 10 percent or
more of any class of voting securities of a bank or
Legal Developments
other company, or any person that the Board determines has the power, directly or indirectly, to exercise a controlling influence over the management or
policies of a bank or other company.
113
conditions imposed by, the Board in connection
with prior applications.
3. Section 225.31 is amended by revising paragraph
(d)(2)(ii) to read as follows:
2. Section 225.13 is amended by revising paragraphs
(a) and (b)(2) to read as follows:
Section 225.13—Factors considered in acting
on bank applications.
(a) Prohibited anticompetitive transactions. As specified in section 3(c) of the BHC Act, the Board may not
approve any application under this subpart if:
(1) The transaction would result in a monopoly or
would further any combination or conspiracy to
monopolize, or to attempt to monopolize, the business of banking in any part of the United States;
(2) The effect of the transaction may be substantially
to lessen competition in any section of the country,
tend to create a monopoly, or in any other manner
be in restraint of trade, unless the Board finds that
the transaction's anticompetitive effects are clearly
outweighed by its probable effect in meeting the
convenience and needs of the community;
(3) The applicant has failed to provide the Board
with adequate assurances that it will make available
such information on its operations or activities, and
the operations or activities of any affiliate of the
applicant, that the Board deems appropriate to
determine and enforce compliance with the BHC
Act and other applicable federal banking statutes,
and any regulations thereunder; or
(4) In the case of an application involving a foreign
bank, the foreign bank is not subject to comprehensive supervision or regulation on a consolidated
basis by the appropriate authorities in its home
country, as provided in section 211.24(c)(l)(ii) of the
Board's Regulation K (12 C.F.R. 211.24(c)(l)(ii)).
(b) Other factors. In deciding applications under this
subpart, the Board also considers the following factors
with respect to the applicant, its subsidiaries, any
banks related to the applicant through common ownership or management, and the bank or banks to be
acquired:
(2) Managerial resources. The competence, experience, and integrity of the officers, directors, and
principal shareholders of the applicant, its subsidiaries, and the banks and bank holding companies
concerned; their record of compliance with laws and
regulations; and the record of the applicant and its
affiliates of fulfilling any commitments to, and any
Section 225.31—Control proceedings.
*
*
*
(2) * * *
(ii) Shares controlled by company and associated
individuals. A company that, together with its
management officials or controlling shareholders
(including members of the immediate families of
either as defined in 12 C.F.R. 226.2(k)), owns,
controls, or holds with power to vote 25 percent
or more of the outstanding shares of any class of
voting securities of a bank or other company
controls the bank or other company, if the first
company owns, controls, or holds with power to
vote more than 5 percent of the outstanding
shares of any class of voting securities of the bank
or other company.
4. Appendix B is amended by revising footnote 1 to
read as follows:
APPENDIX B TO PART
225—CAPITAL
ADEQUACY GUIDELINES FOR BANK HOLDING
COMPANIES AND STATE MEMBER
BANKS:
LEVERAGE
MEASURE
The guidelines will apply to bank holding companies
with less than $150 million in consolidated assets on a
bank-only basis unless:
(1) The holding company or any nonbank subsidiary
is engaged directly or indirectly in any nonbank
activity involving significant leverage, or
(2) The holding company or any nonbank subsidiary
has outstanding significant debt held by the general
public.
Debt held by the general public is defined to mean debt
held by parties other than financial institutions, officers, directors, and controlling shareholders of the
banking organization or their related interests.
114
Federal Reserve Bulletin • February 1993
FINAL RULE—AMENDMENT
TION CC
TO
REGULA-
The Board of Governors is amending 12 C.F.R. Part
229, its Regulation CC (Availability of Funds and
Collection of Checks) to conform the Uniform Commercial Code (UCC) citations in Regulation CC and
its Commentary to the 1990 version of Articles 3 and
4 of the UCC, as approved by the National Conference of Commissioners on Uniform State Laws and
the American Law Institute, and to a recent realignment in Federal Reserve check processing regions.
The amendments will provide updated cross-references between Regulation CC and the latest version
of the UCC and update the routing numbers in the
appendices to the regulation.
Effective January 5, 1993, 12 C.F.R. Part 229 is
amended as follows:
1. The authority citation for part 229 continues to read
as follows:
Authority: 12 U.S.C. 4001 et seq.
2. In section 229.2, in the second sentence of paragraph (cc) "U.C.C. 4-202(2)" is revised to read "UCC
4-202(b)".
3. In Appendix A to part 229, under the heading
"SECOND FEDERAL RESERVE DISTRICT," the
numbers appearing directly under the subheading
"Head Office" are transferred in numerical order
under the subheading "Jericho Office" and the subheading "Head Office" is removed.
4. In Appendix B-2 to part 229, the headings "New
York" and "Jericho" and their corresponding entries
are removed from the table.
5. In Appendix E under the Commentary to section
229.2, in the first sentence of the second paragraph of
paragraphs (f) and (g), "U.C.C. 4-104(l)(c)" is revised
to read "UCC 4-104(a)(3)"; in the second sentence of
paragraph (j), "U.S.C. 3-410, 3-411" is revised to
read "UCC 3-409"; in the first sentence of the third
paragraph of paragraph (k), "U.C.C. 3-120" is revised
to read "UCC 4-106(a)"; the first sentence of the last
paragraph of paragraph (bb) is revised as set forth
below; and in the fourth sentence of paragraph (cc),
"U.C.C. 4-202(2)" is revised to read "UCC
4-202(b)".
APPENDIX
E TO PART
229—[AMENDED]
Section 229.2—Definitions.
(bb) Qualified returned check. * * *
A qualified returned check need not contain the elements of a check drawn on the depositary bank, such
as the name of the depositary bank. * * *
6. In Appendix E under the Commentary to section
229.11, in the fourth sentence of the last paragraph of
paragraph (b) under the heading " Time Period Adjustment for Withdrawing Cash", "U.C.C. 4-107" is
revised to read "UCC 4-108".
7. In Appendix E under the Commentary to paragraph
(a) of section 229.14, in the fourth sentence of the first
paragraph of footnote 3, "U.C.C. 4-211 and 4-213" is
revised to read "UCC 4-214 and 4-215".
8. In Appendix E under the Commentary to section
229.19, in the last sentence of the last paragraph of
paragraph (e), "U.C.C. 4-213(l)(a)" is revised to read
"UCC 4-215(a)(l)".
9. In Appendix E under the Commentary to section
229.30:
a. In paragraph (a), the last two sentences of the
seventh from the last paragraph are removed; two
new sentences are added to the end of the fifth from
the last paragraph as set out below; in footnote 4,
"U.C.C. 4-202(3)" is revised to read "UCC
4-202(c)"; in the third sentence of the sixth from the
last paragraph, "U.C.C. 3-418 and 4-213(1)" is
revised to read "UCC 3-418(c) and 4-215(a)"; the
third from the last paragraph (numbered 1) is removed; the second from the last and the last paragraphs (numbered 2 and 3) are redesignated as 1 and
2, respectively; in newly-redesignated paragraph 1,
"Section 4-301(4)" is revised to read "Section
4-301(d)"; and in newly-redesignated paragraph 2,
"Section 4-301(1)" is revised to read "Section
4-301(a)";
b. In paragraph (b), in the last sentence of the last
paragraph, "U.C.C. 4-207" is revised to read
"UCC 4-208"; and
c. In paragraph (f), in the first sentence of the second
paragraph, "U.C.C. 4-301(1)" is revised to read
"UCC 4-301(a)".
APPENDIX E TO PART
229—[AMENDED]
Legal Developments
Section 229.30—Paying Bank's Responsibility
for Return of Checks
* * * Also, a paying bank is not responsible for
failure to make expeditious return to a party that has
breached a presentment warranty under UCC 4-208,
notwithstanding that the paying bank has returned the
check. (See Commentary to section 229.33(a).)
10. In Appendix E under the Commentary to section
229.31:
a. In paragraph (a), in the second sentence of the
fifth from the last paragraph, "U.C.C. 4-202(3)" is
revised to read "UCC 4-202(c)"; the third from the
last paragraph (numbered 1) is removed; the second
from the last and the last paragraphs (numbered 2
and 3) are redesignated as 1 and 2, respectively; in
newly-redesignated
paragraph
1,
"Section
4-202(2)" is revised to read "Section 4-202(b)";
and in newly-redesignated paragraph 2, "Section
4-212(1)" is revised to read "Section 4-214(a)";
b. In paragraph (b), in the first sentence of the third
paragraph, "U.C.C. 4-202(2)" is revised to read
"UCC 4-202(b)"; and
c. In paragraph (c), in the first sentence of the last
paragraph, "U.C.C. 4-212(1)" is revised to read
"UCC 4-214(a)".
11. In Appendix E under the Commentary to section
229.32, in the fourth sentence of the first paragraph of
paragraph (a), "U.C.C. 3-504(2)" is revised to read
"UCC 3-111"; and in the second sentence of the
second paragraph of paragraph (b), "U.C.C. 4-107" is
revised to read "UCC 4-108".
12. In Appendix E under the Commentary to section
229.33, in the second from the last sentence of the last
paragraph of paragraph (a), "U.C.C. 4-207(1)" is
revised to read "UCC 4-208"; and in the last sentence
of the last paragraph, "U.C.C. 4-207(1) and 4-302" is
revised to read "UCC 4-208 and 4-302".
13. In Appendix E under the Commentary to section
229.35:
a. In paragraph (a), the second sentence of the sixth
paragraph is revised to read "(See UCC 4-207(a)
and 4-208(a).)";
b. In paragraph (b), in the seventh sentence of the
fifth paragraph, "U.C.C. 4-213(1) and 4-302" is
revised to read "UCC 4-215(a) and 4-302"; in the
eighth sentence of the fifth paragraph, "U.C.C.
4-211(2) and (3) and 4-213(3)" is revised to read
"UCC 4-213 and 4-215(d)"; in the tenth sentence of
the fifth paragraph, "U.C.C. 4-211, 4-212, and
4-213" is revised to read "UCC 4-213, 4-214, and
4-215"; in the first and second sentences of the
115
second from the last paragraph (numbered 1), "Section 4-212(1)" is revised to read "Section
4-214(a)"; and the last paragraph (numbered 2) is
revised as set out below; and
c. In paragraph (c), in the second sentence "U.C.C.
4-201(2)" is revised to read "UCC 4-201(b)".
APPENDIX E TO PART
229—[AMENDED]
Section 229.35—Indorsements
(b) * * *
2. Section 3-415 and related provisions (such as
section 3-503), in that such provisions would not apply
as between banks, or as between the depositary bank
and its customer.
14. In Appendix E under the Commentary to section
229.36:
a. In paragraph (b), in the fourth sentence of the
third paragraph (numbered 1), "U.C.C. 4-204(3)" is
revised to read "UCC 4-204(c)"; in the fourth
sentence of the seventh paragraph (numbered 3),
"U.C.C. 3-504(2)" is revised to read "UCC
3-111"; and in the last paragraph, "U.C.C.
3-504(2)(c)" is revised to read "UCC 3-111";
b. In paragraph (c), the third sentence is revised as
set out below; and
c. In paragraph (d), in the fifth sentence, "U.C.C.
4-213(b) or (d)" is revised to read "UCC
4-215(a)(2) or (3)".
APPENDIX E TO PART
229—[AMENDED]
Section 229.36—Presentment and Issuance of
Checks
(c) * * * This process has the potential to improve the
efficiency of check processing, and express provision
for truncation and electronic presentment is made in
UCC 4-110 and 4-406(b). * * *
*
*
*
*
*
15. In Appendix E under the Commentary to section
229.37, before the parenthetical in the second sentence
in the first paragraph, "U.C.C. 4-103(1)" is revised to
116
Federal Reserve Bulletin • February 1993
read "UCC 4-103(a)"; and in the first sentence in the
second paragraph, "U.C.C. 4-103(2)" is revised to
read "UCC 4-103(b)".
16. In Appendix E under the Commentary to section
229.38:
a. In paragraph (a), in the third sentence in the
second paragraph, "U.C.C. 4-103(5) and 4-202(3)"
is revised to read "UCC 4-103(e) and 4-202(c)";
b. In paragraph (b), in the last sentence "sections
4-213 and 4-302" is revised to read "sections 4-215
and 4-302" ; and
c. In paragraph (e), the second sentence is revised to
read as follows:
APPENDIX
E TO PART
229—[AMENDED]
Section 229.38—Liability
(e) * * * It adopts the standard of UCC 4-109(b).
17. In Appendix E under the Commentary to section
229.39, in the introductory text "U.C.C. 4-214" is
revised to read "UCC 4-216".
Capital is the 12th largest commercial banking organization in Missouri, controlling deposits of $503.8
million, representing less than 1 percent of the total
deposits in commercial banking organizations in the
state.1 Magna Bank is the 36th largest commercial
banking organization in Missouri, controlling deposits
of $150.6 million, representing less than 1 percent of the
total deposits in commercial banking organizations in
the state. Upon consummation of this proposal, Capital
would become the ninth largest commercial banking
organization in Missouri, controlling deposits of $654.4
million, representing approximately 1.24 percent of the
total deposits in commercial banking organizations in
the state.
Capital and Magna Bank do not compete directly in
any relevant banking market. Based on all the facts of
record, the Board believes that consummation of this
proposal would not result in any significantly adverse
effects on competition in any relevant banking market.
Considerations relating to the financial and managerial
resources and future prospects of Capital and its
subsidiary banks and Magna Bank, and other supervisory factors the Board is required to consider under
section 3 of the BHC Act, also are consistent with
approval of this application.
Convenience and Needs
Considerations
Statement by the Board of Governors of the
Federal Reserve System Regarding the
Application by Capital Bancorporation, Inc. to
acquire Magna Bank of Southern Missouri
In reviewing this application, the Board also is required to consider the convenience and needs of the
community to be served and take into account the
record of performance of Capital and its subsidiary
banks, as well as Magna Bank, under the Community
Reinvestment Act (12 U.S.C. § 2901 et seq.)
("CRA"). 2 The Board notes that four of Capital's five
subsidiary banks, representing approximately 87 percent of Capital's assets, have received satisfactory
ratings from their primary regulators in their most
recent examinations for CRA performance. 3 However, one of Capital's subsidiary banks, Capital Bank
By order dated November 30, 1992, the Board approved the application of Capital Bancorporation,
Inc., Cape Girardeau, Missouri ("Capital"), pursuant
to section 3 of the Bank Holding Company Act ("BHC
Act") (12 U.S.C.§ 1842) to acquire the voting shares
of Magna Bank of Southern Missouri, Ozark, Missouri
("Magna Bank").
Notice of the application, affording interested parties an opportunity to submit comments, has been
published (57 Federal Register 28,871 (1992)). The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the factors set forth in section 3(c) of
the BHC Act.
1. Deposit data are as of June 30, 1991.
2. The CRA requires the appropriate federal supervisory authority
to "assess the institution's record of meeting the credit needs of its
entire community, including low- and moderate-income neighborhoods, consistent with the safe and sound operation of such institution," and to take this record into account in its evaluation of bank
holding company applications. 12 U.S.C. § 2903.
3. The following banks, including Capital's lead bank, all received
satisfactory ratings at their most recent examinations for CRA performance: Capital Bank of Cape Girardeau County, Cape Girardeau,
Missouri (Federal Deposit Insurance Corporation ("FDIC") — July
26, 1991); Capital Bank of Columbia, Columbia, Missouri (FDIC —
December 11, 1990); Capital Bank of Sikeston, Sikeston, Missouri
(FDIC — October 11, 1990); and Capital Bank of Perryville, N.A.,
Perryville, Missouri (Office of the Comptroller of the Currency —
September 30, 1988). Magna Bank received a satisfactory rating for
CRA performance from the FDIC on December 14, 1991.
ORDERS ISSUED UNDER BANK
COMPANY ACT
HOLDING
Orders Issued Under Section 3 of the Bank
Holding Company Act
Legal Developments
and Trust Company of Clayton, Clayton, Missouri
("Clayton Bank"), controlling approximately 13 percent of Capital's assets, received two consecutive less
than satisfactory examination ratings for CRA performance in 1991 and 1992 from its primary regulator, the
FDIC. 4
The Board has carefully reviewed these examinations and the CRA performance of Capital and its
subsidiary banks, as well as Magna Bank, in light of
the CRA, the Board's regulations, and the jointly
issued Statement of the Federal Financial Supervisory
Agencies Regarding the Community Reinvestment Act
("Agency CRA Statement"). 5 The Board previously
has stated that applicants should address their CRA
responsibilities and have the necessary policies in
place and working well before they file an application.6
In this regard, actions taken by Capital and Clayton
Bank to improve the CRA performance of Clayton
Bank have been carefully considered in this application.
In response to the 1991 examination, Clayton Bank
initiated several measures to address the deficiencies
in its CRA performance. Examiners found in the 1992
examination that these steps resulted in improvement
in Clayton Bank's CRA program, and upgraded Clayton Bank's CRA rating to a "needs to improve"
record of meeting community credit needs. In assigning this rating, the FDIC noted that the lack of
management and personnel resources and the limited
amount of time since the 1991 examination hindered
the bank's ability to implement all needed improvements. In this regard, the record in this case indicates
that in the past few years, Clayton Bank has devoted
significant resources to addressing financial problems
identified by examiners. Although these efforts have
resulted in improvement in the bank's financial condition, Bank management's emphasis on financial concerns limited its ability to fully implement programs
designed to strengthen the bank's CRA program.
In response to the 1992 examination, Capital's board
of directors has approved various additional measures
designed to improve its oversight of the CRA programs of Clayton Bank and its other subsidiary banks.
Clayton Bank also has implemented, and has committed to implement, various measures to improve and
address identified weaknesses in its CRA program.
4. Clayton Bank's CRA performance was rated "substantial noncompliance" by the FDIC as of May 1991, and "needs to improve" as
of April 1992.
5. 54 Federal Register 13,742 (1989).
6. First Interstate BancSystem of Montana, Inc., 77 Federal
Reserve Bulletin 1007 (1991); Agency CRA Statement, 54 Federal
Register at 13,743.
117
These steps include:
(1) Hiring more personnel to administer CRA activities;
(2) Commencing a call program targeting small businesses in its delineated community;
(3) Implementing a home improvement loan program and advertising this program in local newspapers; and
(4) Meeting with groups representing low- and
moderate-income individuals in the bank's delineated community.
Clayton Bank also has committed to allocate a total
of $2 million over the next three years for loans to
qualified low-and moderate-income borrowers. To improve its system of tracking the geographic extension
of credit applications, extensions and denials, the bank
replaced its system of geocoding this information by
zip code with a geocoding-by-census tract system.
Additionally, Clayton Bank has taken certain steps to
increase its participation in community development
activities, including purchasing $1 million of street
improvement bonds for the City of Brentwood, Missouri, a city located within Clayton Bank's revised
service area.
The Board believes that, on balance, the initiatives
implemented by Capital and Clayton Bank since the
1991 and 1992 examinations, and the steps that these
organizations have committed to take, are sufficient to
address the weaknesses in Clayton Bank's record of
CRA performance. These steps were developed in
consultation with FDIC examiners. The Board recognizes that the record compiled in this application
points to areas that continue to require improvement
in the CRA performance of Clayton Bank. Capital has
implemented effective CRA programs at its other
subsidiary banks, as reflected in the CRA examination
reports of these institutions, and the Board believes
that Capital and Clayton Bank have taken strong steps
to ensure that the deficiencies in Clayton Bank's
record of CRA performance will be redressed. The
Board expects Capital and Clayton Bank to implement
fully the CRA initiatives and commitments discussed
in this Order and contained in its application.
Based on all of the facts of record, including the
commitments made by Capital and Clayton Bank in this
case, the Board concludes that convenience and needs
considerations, including the CRA performance records of Capital and its subsidiary banks and Magna
Bank, are consistent with approval of this application.
Capital's progress in implementing these initiatives and
commitments will be monitored by the Federal Reserve
Bank of St. Louis and in connection with future applications to expand its deposit-taking facilities.
Based on the foregoing and other facts of record, the
118
Federal Reserve Bulletin • February 1993
Board has determined that the application should be,
and hereby is, approved. The Board's approval of this
transaction is specifically conditioned upon compliance with the commitments made by Capital and
Clayton Bank in connection with this application. The
commitments and conditions relied upon by the Board
in reaching its decision are both considered commitments imposed in writing by the Board in connection
with its findings and decision and, as such, may be
enforced in proceedings under applicable laws. This
approval is also conditioned upon Capital receiving all
necessary Federal and state approvals.
December 16, 1992
J E N N I F E R J . JOHNSON
Associate Secretary of the Board
Dissenting Statement of Governors Kelley and
LaWare
The Board's precedent requires that the CRA policies
of an applicant and its subsidiary banks must be in
place and working well when an application is considered. In this case, Clayton Bank's CRA policies and
programs have been found to be unsatisfactory in the
last two consecutive CRA performance examinations
by its primary regulator. Although both Capital and
Clayton Bank have initiated policies and programs to
address these deficiencies, several of these initiatives
were not put in place until well after this application
had been filed, and the effect of these initiatives in
improving Clayton Bank's CRA performance has not
been adequately demonstrated on the record before
the Board. For these reasons, we do not believe that
the record of CRA performance at this time is sufficient to conclude that the policies of Capital and
Clayton Bank are working well, and on this basis, we
would deny the application.
December 16, 1992
CB Financial Corporation
Jackson, Michigan
Order Approving Acquisition of a Bank Holding
Company
CB Financial Corporation, Jackson, Michigan ("CB
Financial"), a bank holding company within the meaning of the Bank Holding Company Act ("BHC Act"),
has applied under section 3(a)(3) of the BHC Act
(12 U.S.C. § 1842(a)(3)) to acquire First of Charlevoix
Corporation, Charlevoix, Michigan ("FCC"), through
an interim company, CB Charlevoix Corporation, that
will merge with and into FCC with FCC as the
surviving company. 1
Notice of the application, affording interested persons an opportunity to submit comments, has been
published (57 Federal Register 29,081 (1992)). The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the factors set forth in section 3(c) of
the BHC Act.
CB Financial is the 16th largest commercial banking
organization in Michigan, controlling three subsidiary
banks with total deposits of $535.1 million, representing less than 1 percent of total deposits in commercial
banking organizations in the state. 2 FCC is the 107th
largest commercial banking organization in Michigan,
controlling deposits of $39 million, representing less
than 1 percent of total deposits in commercial banking
organizations in the state. Upon consummation of this
proposal, CB Financial would remain the 16th largest
banking organization in Michigan, controlling deposits
of $574.1 million, representing less than 1 percent of
total deposits in commercial banking organizations in
the state.
Definition of the Relevant Banking Market
The BHC Act provides that the Board may not approve a proposal submitted under section 3 of the
BHC Act if the proposal would result in a monopoly or
the effect of the proposal may be substantially to
lessen competition in any relevant market. In evaluating the competitive factors in this case, the Board has
carefully considered the comments of Resources Planning Corporation ("RPC"). 3 RPC argues that the
relevant geographic market for analyzing the competitive effects of this proposal should be limited to the
City and Township of Charlevoix, Michigan
("Charlevoix"), and that consummation of this proposal would substantially lessen competition for banking services in Charlevoix. 4 RPC relies principally on a
1. Following this acquisition, CB Financial will seek the necessary
regulatory approval to merge FCC into CB Financial and thereafter to
merge FCC's sole subsidiary, First State Bank of Charlevoix,
Charlevoix, Michigan ("FSB"), into CB Financial's subsidiary bank,
Charlevoix County State Bank, also in Charlevoix, Michigan
("CCSB").
2. State banking data are as of June 30, 1992.
3. RPC has also sought to enjoin this proposal in state court under
the Michigan antitrust statutes. In this suit, RPC maintained that the
relevant geographic market was Charlevoix, or in the alternative,
Charlevoix County. The court dismissed RPC's claim, and RPC has
appealed this judgment. See Charlevoix Investment Company, et al. v.
First of Charlevoix Corporation, Case No. 92-343-25-CK (May 29,
1992) (Circuit Court for Charlevoix County).
4. CCSB and FSB, subsidiary banks of CB Financial and FCC,
respectively, are both located in Charlevoix, Michigan. RPC argues
Legal Developments
consultant's study conducted during a two-day visit to
the Charlevoix area in May 1992.5 This study concludes that Charlevoix's unique character as a summer
resort divided by a drawbridge in the center of town,
and the distances between Charlevoix and surrounding
population centers indicate that local customers have
no reasonable alternative for banking services except
depository institutions located in Charlevoix.
The Board and the courts have found that the
relevant banking market for analyzing the competitive
effect of a proposal must reflect commercial and banking realities and must consist of the local area where
the banks involved offer their services and where local
customers can practicably turn for alternatives. 6 The
Board has considered all the facts in this case, including the comments and information provided by RPC
and other commenters 7 and a study conducted by the
Federal Reserve Bank of Chicago ("Reserve Bank"),
and concludes that the relevant geographic market to
evaluate the competitive effects of this proposal is
defined as: Charlevoix County; Emmet County (excluding Bliss, Carp Lake, and Wawatam Townships);
Burt, Mentor, Tuscarora, and Wilmot Townships in
Cheboygan County; and Banks Township in Antrim
County, all in Michigan (the "Petoskey banking market").
The Reserve Bank conducted an extensive investigation of the Petoskey banking market including conducting telephone surveys of customers for banking
services, and reviewed data regarding commuting,
traffic patterns, and banking transactions. In September 1992, the Reserve Bank also conducted a four-day
field study of the Charlevoix area. This study included
trips to surrounding populations centers, interviews
with local bankers and businessmen, and assessments
that this proposal would permit CB Financial to own two of the four
banks and savings associations (together "depository institutions")
located in Charlevoix and thereby control approximately 90 percent of
the total deposits held by depository institutions in Charlevoix.
5. RPC has also provided statements from another consultant
agreeing with the conclusion that the proposal would have a significantly adverse effect on competition in Charlevoix and stating that any
definition of the relevant geographic market as being larger than
Charlevoix would not provide a realistic basis for assessing the
competitive consequences of this proposal on small business lending
in the market. For reasons explained in previous decisions, the Board
continues to believe that the competitive analysis of bank expansion
proposals should be based on the availability of the cluster of banking
services to a range of customers in the local banking market. See, e.g.,
First Hawaiian, Inc., 77 Federal Reserve Bulletin 52 (1991). See also
United States v. Philadelphia National Bank, 374 U.S. 321 (1963).
6. See St. Joseph Valley Bank, 68 Federal Reserve Bulletin 673, 674
(1982).
7. The Board received comments from individuals in the Charlevoix
area who believe that the proposal would result in monopolistic
market power that would have the effect of increasing prices for
banking services, decreasing hours of operation, reducing available
banking services, and discouraging other competitors from entering
the market.
119
of commercial advertising activities. The results of this
investigation and other analysis indicate that the relevant geographic market for purposes of analyzing the
competitive effects of this proposal extends beyond
the geographic boundaries of Charlevoix to include the
area defined above as the Petoskey banking market.
The Petoskey banking market is anchored by four
small towns located in Charlevoix and Emmet Counties: Petoskey (population of 6,056), Charlevoix (population of 3,116), East Jordan (population of 2,240),
and Boyne City (population of 3,478).8 A number of
geographic and commercial factors tie these towns
together with Charlevoix. For example, Charlevoix is
located only 16 miles from Petoskey, the largest population center in the area, and is connected to Petoskey by a major, well-maintained federal highway. 9 The
Reserve Bank's study found that this highway provided convenient access to Petoskey, with travel time
averaging approximately 20 minutes and varying only
slightly depending on the time of day. In addition,
local residents indicated that travel to Petoskey was
not unduly difficult even during the drawbridge's peak
operating times during the summer vacation season
because the opening of the drawbridge is predictable
and avoidable.10 Moreover, residents commented that
the peak tourist season in this area lasts only about
two months and the bridge opens less frequently
during the rest of the year. 11 Travel time from
Charlevoix to Boyne City is approximately 25 minutes
and approximately 20 minutes from Petoskey to Boyne
City. East Jordan is even closer to Charlevoix, with
travel time of approximately 15 minutes.
Petoskey is the largest community in the banking
market and is the location of the area's two largest
employers, who employ more than 1800 workers, 12 as
well as numerous other relatively sizable employers.
Data indicate that there is a considerable amount of
commuting from Charlevoix County to places of employment in Emmet County. 13 In addition, the largest
8. Population data are based on 1990 Census Bureau information.
9. Charlevoix is located between Lake Michigan to the northwest
and Lake Charlevoix to the east. Petoskey is northeast of Charlevoix
and connected by federal highway U.S. 31, which has a posted speed
limit of 55 miles per hour.
10. The drawbridge divides the town approximately in half and
primarily affects travel north to Petoskey by individuals in the
southern part of Charlevoix.
11. During July and August, the population of Charlevoix increases
from 3,116 to over 20,000.
12. Northern Michigan Hospital, with more than 1,200 employees,
is one of two regional medical centers in Michigan. Boyne USA
Resorts employs approximately 600 workers in Emmet County.
13. Commuting data for 1980 indicate that 14.3 percent of the overall
labor force in Charlevoix County commutes to work in Emmet
County, and that 9.3 percent of these workers commute from
Charlevoix to Emmet County. More than half of the Charlevoix
workers commuting to Emmet County (4.9 percent) work in Petoskey.
Commuting data for 1990 reflect no significant change in these
120
Federal Reserve Bulletin • February 1993
employers in Charlevoix County are in East Jordan
and Boyne City. 14
Data on traffic patterns collected by the Michigan
Department of Transportation show a significant
amount of road travel between Charlevoix and Petoskey, indicating accessibility and the economic integration between Charlevoix and Petoskey. Despite the
fact that these two towns are small, traffic counts at
three locations between Charlevoix and Petoskey indicate that approximately 10,000 vehicles pass daily
between these two towns.
In addition, Petoskey has been designated as a Rand
McNally Basic Trading Center for the area that includes Emmet, Charlevoix, Cheboygan, and Otsego
Counties, because Petoskey is a town which serves as
a center for shopping goods purchased by residents of
that area. 15 This Trading Center designation is based
on a determination that consumers in this area ordinarily travel to Petoskey to purchase retail goods.
Banking data also confirm that consumers in
Charlevoix regularly rely on providers of goods and
services throughout the Petoskey banking market as
reasonable alternatives to the providers in Charlevoix.
For example, check-clearing data from the subsidiary
banks of CB Financial and FCC in Charlevoix show
that a substantial number of checks cleared at both
banks were for transactions outside Charlevoix, with
nearly 20 percent of these transactions occurring in
Petoskey.
Residents of Charlevoix and surrounding areas also
are well informed on the practicable alternatives for
banking services through commercial advertising. For
example, the area's only daily newspaper, the Petoskey News-Review, is located in Petoskey and is widely
distributed throughout Emmet and Charlevoix Counties. This paper regularly carries advertisements for
banking services from all banking institutions in the
area. 16 Local radio stations in Petoskey, Charlevoix,
and Boyne City also broadcast banking advertisements from banks throughout the Petoskey banking
market to consumers in Emmet and Charlevoix Coun-
commuting patterns. For example, 14.4 percent of the labor force in
Charlevoix County commuted to jobs in Emmet County in 1990.
14. East Jordan Iron Works (500 employees) and Dura Mechanical
(300 employees) are located in East Jordan. Allied-Signal (486 employees) is located in Boyne City.
15. The Petoskey, Michigan Basic Trading Area is defined to
include Emmet, Charlevoix, Cheboygan and Otsego Counties. Basic
Trading Centers such as Petoskey are also viewed as serving their
surrounding areas with various specialized services, such as medical
care, entertainment, higher education, and a daily newspaper.
16. Charlevoix County accounts for 38 percent of this publication's
circulation, with 16 percent within the city boundaries of Charlevoix.
Data from the Circulation Department of the Petoskey News-Review
indicate that the total circulation of the newspaper in Charlevoix,
Boyne City, and East Jordan exceeds the estimated number of
households in those cities.
ties. In addition, the two telephone directories serving
the region include listings of all banks and their branch
locations identified in the Reserve Bank's study as
being in the Petoskey banking market. Information
regarding banking services and prices is widely disseminated throughout the market through these media
outlets.
Bankers interviewed by the Reserve Bank in Petoskey and surrounding towns, such as Boyne City, have
confirmed that their institutions are in competition
with banks in Charlevoix and attract customers from
Charlevoix. For example, several Petoskey area bankers stated that they regularly reviewed the loan and
deposit rates and operating hours of Charlevoix banks
for comparability. A survey conducted by the Reserve
Bank of banks in Petoskey, Charlevoix, and Boyne
City showed that banks generally have comparable
prices for their products and hours of operation. 17
Customers also have convenient access to a number of
banking services throughout the Petoskey banking
market through extensive ATM networks. For example, the two largest banking institutions in the market,
NBD Bank and Old Kent Bank, are located in Petoskey and serve their Charlevoix customers through
ATMs located in that town. Moreover, a banker in
Boyne City stated that his bank is establishing a new
branch near Charlevoix to serve its Charlevoix customers more efficiently.
Data on the deposit and loan customers of CCSB
and FSB, the subsidiary banks of CB Financial and
FCC, also indicate that these banks serve areas that
extend beyond the boundaries of Charlevoix County.
For example, data from CB Financial's subsidiary
bank indicate that more than 30 percent of its loan and
deposit accounts are from areas outside Charlevoix,
including Petoskey. Similar data for FCC's subsidiary
bank indicate that approximately 25 percent of deposit
accounts and over 13 percent of loan accounts are
derived from outside the immediate Charlevoix area.
A telephone survey of consumers and small businesses in Charlevoix and Emmet Counties conducted
by the Reserve Bank indicate that a number of customers live in one town and obtain banking services in
another town within the Petoskey banking market. 18
17. The survey reviewed a number of the products and the hours of
operation for three banks in Petoskey, two banks in Charlevoix, and
one bank in Boyne City. All banks surveyed had comparable rates for
time deposits, money market deposit accounts, and commercial loans.
In addition, all banks had extended hours on Friday and the same
hours on Saturday.
18. This survey also indicated that individuals in Atwood (located in
Antrim County) frequently travel to Charlevoix and East Jordan, that
individuals in Burt Lake and Indian River (both located in Cheboygan
County) routinely travel to Petoskey for work and shopping, and that
residents of Pellston (located in Emmet County) are drawn to Petoskey for shopping more regularly than to the City of Cheboygan.
Legal Developments
For example, survey data revealed consumers who
live in Charlevoix and bank in Petoskey, and businesses which are located in the City of Charlevoix and
use banks located in Emmet County. Moreover, a
business respondent located in Petoskey had accounts
in a Charlevoix bank, and another business respondent
indicated that it would look to Petoskey for banking
services if it became dissatisfied with the services
provided by its Charlevoix bank.
After review of these data and the other facts of
record, the Board believes that the record indicates
that customers in Charlevoix reasonably can and do
turn to providers of banking services throughout the
Petoskey banking market. On this basis, the Board
disagrees with the contention of RPC that the geographic market in this case should be limited to the
City and Township of Charlevoix. Instead, based on
all of the facts of record, the Board finds that the
relevant geographic market in this case is the Petoskey
banking market as defined above.
Competitive Effects in the Petoskey Banking Market
CB Financial is the fifth largest depository institution
in the market, controlling deposits of $45 million,
representing 7.9 percent of total deposits in depository
institutions in the market. 19 FCC is the sixth largest
depository institution in the market, controlling deposits of $36.3 million, representing 6.4 percent of total
deposits in depository institutions in the market. Upon
consummation, CB Financial would become the fourth
largest depository institution in the market, controlling
total deposits of $81.3 million, representing 14.3 percent of total deposits in depository institutions in the
market. The Herfindahl-Hirschman Index ("HHI")
would increase 101 points to a level of 1786.20 Accordingly, in light of the small increase in concentration,
the number of competitors remaining in the market,
19. Market data are as of June 30, 1991. In this context, depository
institutions include commercial banks and savings banks. Market
share data are based on calculations in which the deposits of thrift
institutions are included at 50 percent. The Board previously has
indicated that thrift institutions have become, or have the potential to
become, major competitors of commercial banks. See Midwest Financial Group, 75 Federal Reserve Bulletin 386 (1989); National City
Corporation, 70 Federal Reserve Bulletin 743 (1984).
20. Under the revised Department of Justice Merger Guidelines, 49
Federal Register 26,823 (June 29, 1984), a market in which the
post-merger HHI is between 1000 and 1800 is considered to be
moderately concentrated. The Department of Justice has informed the
Board that a bank merger or acquisition generally will not be challenged (in the absence of other factors indicating anticompetitive
effects) unless the post-merger HHI is at least 1800 and the merger
increases the HHI by at least 200 points. The Justice Department has
stated that the higher than normal HHI thresholds for screening bank
mergers and acquisitions for anticompetitive effects implicitly recognizes the competitive effect of limited-purpose lenders and other
non-depository financial entities.
121
and other facts of record, the Board concludes that
consummation of the proposal is not likely to result in
any significantly adverse effect on competition in any
relevant banking market. The Board also concludes
that the financial and managerial resources, supervisory factors, and future prospects of CB Financial and
FCC are consistent with approval of this application.
Convenience and Needs
Considerations
RPC has also alleged that this transaction is likely to
have an adverse effect on the convenience and needs
of the community, and has alleged that the performance under the Community Reinvestment Act
(12 U.S.C. § 2901 et seq.) ("CRA") of CB Financial
and its subsidiary banks is deficient in a number of
areas. Among its allegations, RPC raises concerns
regarding the adequacy of certain aspects of the CRA
program of CB Financial's lead bank, City Bank and
Trust Company, Jackson, Michigan ("City Bank"),
including allegations that CB Financial has not satisfactorily addressed the higher denial rate of mortgage
loans by City Bank for minorities as opposed to whites
based on City Bank's 1991 Home Mortgage Disclosure
Act ("HMDA") statements, and that the mortgage
lending record of City Bank does not compare satisfactorily with other banks in the community. RPC also
challenges City Bank's methodology for defining its
delineated community, and raises issues regarding
City Bank's CRA compliance, and City Bank's corporate policies, including challenging the level of involvement of City Bank's CRA officer. In addition,
RPC challenges City Bank's CRA self-assessment,
community outreach, and marketing efforts, and questions whether the commitments made by CB Financial
are too broad and vague to serve as effective goals for
improving CRA performance. 21
21. RPC also contends in general that CB Financial's application
does not discuss in detail how convenience and needs considerations
would be addressed, and specifically claims that:
(1) CCSB's CRA Statement has not been updated since 1989;
(2) The public portion of CCSB's CRA file was not available for four
business days;
(3) CCSB did not have available current or accurate literature
regarding its banking services in May 1992; and
(4) CCSB has not been evaluated for CRA compliance since 1990.
Other commenters maintain that the proposal would result in the
elimination of local ownership of the target bank and thereby have a
negative impact on the convenience and needs of customers in and
around Charlevoix. The record indicates that the board of the bank
resulting from the merger of CCSB and FSB will consist of persons
who are familiar with the Charlevoix area from their experience on the
boards of CCSB and FSB. In addition, senior management of the
merged bank responsible for the day-to-day operations of the bank
will be made up of current officers of CCSB and FSB who would
continue to reside in the Charlevoix area. As a result, the Board
believes there would be no loss of expertise or knowledge of special
credit needs in the communities served.
122
Federal Reserve Bulletin • February 1993
In considering the convenience and needs of the
communities to be served by these institutions, the
Board has carefully reviewed the CRA performance
record of CB Financial's subsidiary banks and FSB, as
well as Protestants' comments and CB Financial's
responses to those comments. The Board has considered the CRA performance in light of the CRA, the
Board's regulations, and the Statement of the Federal
Financial Supervisory Agencies Regarding the Community Reinvestment Act ("Agency CRA Statement"). 22
An important element of the analysis of CRA performance is the rating received by the institution
following an examination of CRA performance and
compliance by the institution's primary federal supervisor. The Board notes that CB Financial's lead bank,
City Bank, received a satisfactory rating from its
primary regulator, the Office of the Comptroller of the
Currency, at its most recent CRA examination as of
February 1989. CCSB received a CRA rating of "outstanding" from the Federal Deposit Insurance Corporation ("FDIC") as of May 1990, and City Bank,
St. Johns, Michigan, received a CRA rating of "satisfactory" from the FDIC as of February 1991. The
Agency CRA Statement provides that although CRA
examination reports do not provide conclusive evidence of an institution's CRA record, these reports
will be given great weight in the application process.
The record in this case also indicates that CB
Financial has in place the elements of an effective
CRA program. CB Financial has assigned CRA compliance responsibilities to its Assistant Vice President
and Legal Counsel, whose responsibility is to coordinate and monitor CRA compliance activities at all of
CB Financial's subsidiary banks. This individual
serves as CRA consultant and advisor to CCSB and
City Bank. The board of directors of CCSB and City
Bank annually review and are responsible for approving the CRA Statement for their respective banks.
The CRA Statements of CCSB and City Bank indicate that, to assist in meeting the credit needs of the
communities served, both banks offer a wide range of
lending programs such as: student loans; loans guaranteed by the Small Business Administration and
other federal, state, and local agencies; residential
loans; and community development loans. Since 1989,
City Bank has also offered rental rehabilitation loans,
and loans under the Michigan State Housing Development Authority, and the Michigan Credit Certification
Program to low- and moderate-income customers.
CCSB and City Bank employ various methods of
outreach to ascertain the credit needs of their entire
22. 54 Federal Register 13,742 (1989).
communities. For example, CCSB maintains membership in the Charlevoix, Ellsworth and Central Lake
Chambers of Commerce, and the Northern Lakes
Economic Alliance. CCSB also participates in various
charitable and non-profit community organizations
such as the local United Funds and Little Traverse
Conservancy, and officers and directors of CCSB are
involved in community service clubs such as the
Lions, Rotary, and Kiwanis.
City Bank's outreach efforts include a customer call
program in which bank officers contact area customers
and non-customers to determine how the bank may
better serve the credit needs of the community. A
report of each call is prepared and delivered to the
bank's business development officer, and the business
development officer will refer the individual to the
appropriate bank department. 23 The business development officer also discusses information from these
contacts with City Bank's President or CRA Officer in
order to improve the bank's efforts to assist in meeting
ascertained credit needs. To date, the bank made
approximately 1,400 business development calls. City
Bank's ascertainment efforts also include memberships in the Albion Alliance, Albion Civic Foundation,
Chamber of Commerce, Jackson Human Relations
Commission, Jackson Venture Capital Forum,
NAACP, and the United Way.
In addition, City Bank's marketing activities include
advertising in the Jackson Citizen Patriot, the area's
major newspaper, as well as the Blazer News and
Metroplex, two newspapers which target low-income
and minority communities in the Jackson area. City
Bank also advertises in local shoppers' newspapers,
and has instituted a radio advertising program targeted
towards low- and moderate-income areas.
The 1991 HMDA data reported by City Bank indicates disparities in rates of housing-related loan applications, and in approvals and denials that vary by
racial or ethnic group and income levels. Because all
banks are obligated to ensure that their lending practices are based on criteria that assure not only safe and
sound lending, but also assure equal access to credit
by creditworthy applicants regardless of race, the
Board is concerned when the record of an institution
indicates disparities in lending to minority and lowand moderate-income applicants. The Board recognizes, however, that HMDA data alone provide only a
limited measure of an institution's lending in its community. The Board also recognizes that HMDA data
have limitations that make the data inadequate bases,
absent other information, for conclusively determining
23. All inquiries concerning credit needs which are expressed to
bank tellers are referred to the branch manager or officer, who will
contact the business development officer.
Legal Developments
whether an institution has engaged in illegal discrimination on the basis of race or ethnicity in making
lending decisions.
The most recent examination for CRA compliance
and performance conducted by the bank's primary
regulator found no evidence of illegal discrimination at
City Bank. HMDA data for 1991 also show that City
Bank originated housing-related loans in 67 percent
of the applications that it received from low- and
moderate-income areas in Calhoun County, and in
63 percent of the applications that it received from
low- and moderate-income areas in Jackson County.
In addition, the percentage of home mortgage loan
applications received by City Bank from minorities on
average exceeds the percentage received by other
lenders in the Jackson market. The bank receives
twice as many mortgage loan applications as do other
banking institutions in Jackson County. 24 City Bank's
record for mortgage loan originations in low-income
census tracts is also better than the average for other
banking institutions in the Jackson market. The ratio
of City Bank's mortgage loans made in low-income
census tracts to its mortgage loans in high-income
census tracts is higher than the comparable ratio for
other banking institutions in the Jackson market.
In order to monitor its lending activity to assure the
uniform application of lending standards, monthly
lending reports from the mortgage and consumer lending areas are reviewed by the bank's CRA Officer.
These reports include information regarding application denials as well as loans originated.25 Periodically,
the CRA Officer reviews his assessments with the
bank's President and Chief Executive Officer.
The Board also notes that other facets of City Bank's
lending record reflect its commitment to serving lowand moderate-income areas. For example, City Bank
represents that its underwriting criteria are no more
stringent than standards employed by the Federal National Mortgage Association or the Federal Home Loan
Mortgage Corporation. In 1992, City Bank made eight
rehabilitation loans totalling $69,000 through the Michigan State Housing Development Authority in conjunction with the Jackson Community Development programs. City Bank presently has 26 loans outstanding
totalling $9.2 million outstanding under the Economic
Development Bonds Program. In addition, City Bank
originates loans under Small Business Administration
programs, federal housing programs, and the Albion
24. City Bank receives 9 percent compared with 4.5 percent on
average for other lenders.
25. These reports also cover information obtained from the two
census tracts in Jackson County which have minority populations that
exceed 50 percent and the four census tracts in the county in which the
median income is less than 80 percent of the median income for the
City of Jackson.
123
Commercial Revitalization Program. The bank also
purchased a local financial development authority bond
in the amount of $1.1 million to bring a new employer to
Jackson County and thereby create over 150 jobs.
City Bank is a founding member of the Jackson
Affordable Housing Corporation ("JAHC"), a local
non-profit organization designed to provide credit education and assistance to minority and low- and
moderate-income families that seek to qualify for
mortgage financing at a participating lending institution. In addition to being a participating lending institution, City Bank has provided technical and financial
assistance to the organization. Moreover, City Bank
has created a program entitled Credit Application
Review Evaluation to provide credit counseling to low
and moderate income groups. City Bank is also a
sponsor of, and participant in, the Southside Self-Help
Neighborhood Improvement Association's annual
program, an event designed to provide credit and
employment information to low- and moderate-income
individuals in Jackson. City Bank also has taken steps
to code its deposit and lending information by geographic area to allow the bank to assess more accurately the effectiveness of its CRA policies and programs, and expects to complete the project in early
1993.
City Bank also provides basic checking services to
the community it serves, including free checking to
senior citizens, churches and church groups. In addition, the bank provides a reduced check cashing fee
for non-customers who cash Michigan Department of
Social Services checks at the bank.
City Bank's delineated service area currently extends well beyond the Jackson MSA and includes all of
Jackson County, 40 percent of Calhoun County and
small portions of Eaton, Washtenaw, and Lenawee
Counties. The Board notes that the bank's delineated
community includes two minority and four low- to
moderate-income census tracts in Jackson County,
and one minority census tract in Calhoun County. City
Bank made a small addition to its delineated community in 1992 after assessing lending patterns on the
basis of the OCC's CRA regulations which permit a
bank to rely on existing boundaries, including standard
MSA or counties where its offices are located, and its
effective lending area to delineate its service community. On the basis of the facts of record, the Board
concludes that there is no evidence to suggest that City
Bank's service area improperly excludes minority or
low- and moderate-income census tracts.
RPC's allegations that the transaction will not result
in any defined improvement in services in the
Charlevoix area are not supported by the record. CB
Financial has informed the Board that FSB will offer
no-charge checking and home equity-line loans, and
124
Federal Reserve Bulletin • February 1993
will adopt a program to encourage direct deposit of
social security and/or pension benefits to address the
deposit and credit needs of senior citizens. CB Financial will encourage FSB to evaluate and consider
offering programs and services to address the deposit
and credit needs of the small business community,
such as: public seminars and presentations, seasonal
lines of credit, short-term loans, revolving-credit arrangements, SB A loans, community-revitalization
loans, merchant-credit-card programs, night deposit
services, and expanded banking hours during the
tourist season.
CB Financial will also encourage FSB to consider
programs to address the deposit and credit needs of
low- to moderate-income families, such as: waiving
service charges for the deposit of governmental
checks, reducing service charges for cashing government checks, and making various home improvement
loans (including FHA Title I home improvement loans,
United Guaranty home improvement loans, neighborhood improvement loans, and rehabilitation loans on
rental property). Moreover, CB Financial will encourage FSB to continue to offer competitive home mortgage loans and loans through the Michigan Mortgage
Credit Certificate Program and the State of Michigan
Housing Development Authority.
The Board notes that upon consummation CB Financial intends to review the CRA plan of FSB and
integrate that plan with the CRA plan of CCSB. CB
Financial also plans to ensure that the CRA program of
FSB identifies the needs of the Charlevoix community
by contacting governmental and community leaders,
representatives of small businesses, low- and moderate-income groups, senior citizen groups, and minority
organizations to survey the credit and deposit needs of
the community. CB Financial intends for FSB to
identify and participate in governmental programs
available to help meet the deposit and credit needs of
the community, encourage and solicit public CRA
input, and develop educational programs to inform
segments of the community such as senior citizens and
low-income families of the deposit and credit programs
offered by the bank. CB Financial also intends that
FSB implement regular education programs for bank
employees to inform them of the goals and requirements of CRA compliance and to train them in addressing the credit and deposit needs of specialized
groups such as small businesses, senior citizens, and
low-income families.
On the basis of these and other facts of record,
including the satisfactory CRA performance records
of the subsidiary banks of CB Financial and FSB,
and the size of City Bank and the community that it
serves, the Board concludes that considerations relating to the convenience and needs of the commu-
nities to be served are consistent with approval of
this application.
Based on the foregoing and other facts of record, the
Board has determined that the application should be,
and hereby is, approved. 26 The Board's approval is
expressly conditioned upon compliance with all of the
commitments made by CB Financial in connection
with this application. For the purpose of this action,
these commitments and conditions will both be considered conditions imposed in writing and, as such,
may be enforced in proceedings under applicable law.
This transaction shall not be consummated before
the thirtieth calendar day following the effective date
of this Order, or later than three months after the
effective date of this Order, unless such period is
extended for good cause by the Board or by the
Federal Reserve Bank of Chicago, pursuant to delegated authority.
By order of the Board of Governors, effective
December 16, 1992.
Voting for this action: Chairman Greenspan and Governors
Mullins, Angell, Kelley, LaWare, Lindsey, and Phillips.
JENNIFER J . JOHNSON
Associate Secretary of the Board
Old National Bancorp
Evansville, Indiana
Order Approving Acquisition of a Bank Holding
Company
Old National Bancorp, Evansville, Indiana ("Old National"), a bank holding company within the meaning
of the Bank Holding Company Act ("BHC Act"), has
applied for the Board's approval under section 3 of the
BHC Act (12 U.S.C. § 1842) to acquire all of the
voting shares of City Financial Bancorp, Inc., Dan-
26. Several commenters have requested that the Board hold a public
hearing to assess further facts surrounding the impact of this proposed
acquisition on competition. The Board is not required under section 3
of the BHC Act to hold a public hearing unless the primary regulator
for the bank to be acquired does not approve the proposal. In this
case, the primary supervisor for the bank does not object to the
proposal.
Generally, under the Board's rules, the Board may, in its discretion,
hold a public hearing or meeting on an application to clarify factual
issues related to the application and to provide an opportunity for
testimony, if appropriate. 12 C.F.R. 262.3(e) and 262.25(d). The
Board has carefully considered these requests. In the Board's view,
the parties have had ample opportunity to present submissions, and
the Protestants have submitted substantial written comments that
have been considered by the Board. In light of these facts, the Board
has determined that a public meeting or hearing is not necessary to
clarify the factual record in this application, or otherwise warranted in
this case. Accordingly, the request for a public meeting or hearing on
this application is hereby denied.
Legal Developments
ville, Illinois ("City Financial"), and thereby acquire
City Financial's three subsidiary banks: The City
National Bank of Danville, Danville, Illinois; The City
National Bank of Hoopeston, Hoopeston, Illinois; and
City Potomac Bank, Potomac, Illinois.
Notice of the application, affording interested persons an opportunity to submit comments, has been
published (57 Federal Register 42,586 (1992)). The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the factors set forth in section 3(c) of
the BHC Act.
Old National, with approximately $3.1 billion in
consolidated assets, controls 17 banking subsidiaries
in Indiana, Kentucky and Illinois. In Illinois, Old
National is the 36th largest commercial banking organization, controlling deposits of $479.6 million, representing less than 1 percent of the total deposits in
commercial banking organizations in the state. 1 City
Financial is the 201st largest commercial banking
organization, controlling deposits of $84.6 million,
representing less than 1 percent of the total deposits in
commercial banking organizations in Illinois. Upon
consummation of the proposed transaction, Old National would become the 31st largest commercial banking organization in the state, controlling $564.2 million
in deposits, representing less than 1 percent of total
deposits in commercial banking organizations in the
state.
Section 3(d) of the BHC Act, the Douglas Amendment, prohibits the Board from approving an application by a bank holding company to acquire any bank
located outside of the bank holding company's home
state, unless such acquisition is "specifically authorized by the statute laws of the State in which such
bank is located, by language to that effect and not
merely by implication." 2 Old National, whose home
state is Indiana for purposes of the Douglas Amendment, 3 seeks to acquire a bank in Illinois. The Illinois
interstate banking statute expressly authorizes the
acquisition by an out-of-state bank holding company
of an Illinois bank, and the Board has previously
determined that the interstate banking statute of Illinois permits the acquisition of Illinois banking organizations by Indiana banking organizations.4 Based on
all the facts of record, the Board concludes that Old
National's acquisition of City Financial complies with
1. State and market deposit data are as of June 30, 1991.
2. 12 U.S.C. § 1842(d).
3. A bank holding company's home state is that state in which the
operations of the bank holding company's banking subsidiaries were
principally conducted on July 1, 1966, or the date on which the
company became a bank holding company, whichever is later.
4. See 111. Ann. Stat. ch. 17, para. 2510.01; Old National Bancorp,
74 Federal Reserve Bulletin 398 (1988).
125
the Illinois interstate banking statute, and that Board
approval of this proposal is not prohibited by the
Douglas Amendment. Approval of this proposal is
conditioned upon Old National receiving all required
state regulatory approvals.
Old National and City Financial compete directly in
the Danville, Illinois, banking market. 5 Old National is
the largest commercial banking or thrift organization
("depository institution") in the market, controlling
deposits of $168.1 million, representing 24.6 percent of
total deposits held by depository institutions in the
market. 6 City Financial is the fourth largest depository
institution in the market, controlling deposits of $36.9
million, representing 5.4 percent of total deposits held
by depository institutions in the market. Upon consummation of this proposal, Old National would control deposits of $205 million, representing 30 percent of
deposits in the market. The Herfindahl-Hirschman
Index ("HHI") for the market would increase by 265
points to 1866 upon consummation of the proposal. 7
A number of characteristics of the Danville banking
market indicate that the increase in concentration
levels as measured by the HHI for this market overstates the likely effect of this proposal on competition
in this market. Upon consummation of this proposal,
8 commercial banks and 4 thrifts would remain as
competitors of Old National in the market. The market
is also attractive for entry, ranking second in population and fourth in total bank deposits among the 76
nonmetropolitan counties in Illinois. In addition,
credit unions actively compete in the market. 8 After
considering the competition offered by other depository institutions in the market, the number of competitors remaining in the market, the level of and the
increase in market concentration, and other facts of
5. The Danville, Illinois, banking market is approximated by Vermillion County, Illinois, less Butler, Green and Sidell townships.
6. Market share data are based on calculations in which the deposits
of thrift institutions are included at 50 percent. The Board previously
has indicated that thrift institutions have become, or have the potential to become, significant competitors of commercial banks. See
Midwest Financial Group, 75 Federal Reserve Bulletin 386 (1989);
National City Corporation, 70 Federal Reserve Bulletin 743 (1984).
7. Under the revised Department of Justice Merger Guidelines, 49
Federal Register 26,823 (June 29, 1984), a market in which the
post-merger HHI is above 1800 is considered to be highly concentrated. The Justice Department has informed the Board that a bank
merger or acquisition generally will not be challenged (in the absence
of other factors indicating anticompetitive effects) unless the postmerger HHI is at least 1800 and the merger increases the HHI by more
than 200 points. The Justice Department has stated that the higher
than normal HHI thresholds for screening bank mergers for anticompetitive effects implicitly recognize the competitive effect of limitedpurpose lenders and other non-depository financial entities.
8. Credit unions in the Danville market control approximately
12 percent of the deposits in commercial banks, thrifts, and credit
unions in the market, which is well above the national average of
approximately 5 percent. Two credit unions appear to be open to all,
or nearly all, residents of Vermillion County, and another is open to all
residents of the city of Danville.
126
Federal Reserve Bulletin • February 1993
record, the Board concludes that consummation of
this proposal would not have a significantly adverse
effect on competition or the concentration of banking
resources in the Danville banking market or in any
other relevant banking market.
The financial and managerial resources and future
prospects of Old National, City Financial, and their
respective subsidiaries are consistent with approval of
this proposal. Considerations relating to the convenience and needs of the communities to be served and
the other factors the Board must consider under section 3 of the BHC Act are also consistent with approval of this proposal.
Based on the foregoing and all the facts of record,
including the commitments made by Old National in
connection with this application, the Board has determined that the application should be, and hereby is,
approved. The Board's approval of this proposal is
specifically conditioned on compliance with the commitments made by Old National in connection with
this application and with the conditions referenced in
this Order. These commitments and conditions are
both conditions imposed in writing by the Board, and,
as such, may be enforced in proceedings under applicable law.
The acquisition shall not be consummated before
the thirtieth calendar day after the effective date of this
Order, or later than three months after the effective
date of this Order, unless such period is extended for
good cause by the Board or by the Federal Reserve
Bank of St. Louis, acting pursuant to delegated authority.
By order of the Board of Governors, effective
December 14, 1992.
Voting for this action: Chairman Greenspan and Governors
Mullins, Angell, Kelley, LaWare, and Phillips. Absent and
not voting: Governor Lindsey.
JENNIFER J . JOHNSON
Associate Secretary of the Board
United Missouri Bancshares, Inc.
Kansas City, Missouri
acquire their respective subsidiary banks ("Kansas
Banks"):
(1) M-L Bancshares, Inc., Wichita, Kansas, and
thereby acquire Security State Bank of Great Bend,
Great Bend, Kansas, and Russell State Bank, Russell, Kansas;
(2) Highland Bancshares, Inc., Topeka, Kansas, and
thereby acquire Highland Park Bank and Trust,
Topeka, Kansas;
(3) North Plaza Bancshares, Inc., Topeka, Kansas,
and thereby acquire North Plaza Bank State Bank,
Topeka, Kansas;
(4) Bellcorp, Inc., Manhattan, Kansas, and thereby
acquire Citizens Bank and Trust Co., Manhattan,
Kansas; and
(5) NBA Bankshares, Inc., Salina, Kansas, and
thereby acquire The National Bank of America at
Salina, Salina, Kansas.
Upon consummation of the proposal, United Missouri
proposes to merge the Kansas BHCs into its newly
formed and wholly owned subsidiary, United Subsidiary, Inc., Kansas City, Missouri, which has applied
under section 3(a)(1) of the BHC Act to become a bank
holding company.
Notice of the applications, affording interested persons an opportunity to submit comments, has been
published (57 Federal Register 32,219 (1992)). The
time for filing comments has expired, and the Board
has considered the applications and all comments
received in light of the factors set forth in section 3(c)
of the BHC Act.
United Missouri, with $5.3 billion in consolidated
assets, controls 20 banks in Illinois, Missouri, Delaware, and Colorado. 1 Upon consummation of the
proposal, United Missouri would become the fifth
largest banking organization in Kansas, controlling
deposits of $453 million, representing approximately
1.75 percent of the deposits in all depository institutions in the state. 2
Douglas
Amendment
Order Approving Acquisition of Banks and
Formation of a Bank Holding Company
Section 3(d) of the BHC Act, the Douglas Amendment, prohibits the Board from approving an application by a bank holding company to acquire any bank
located outside the bank holding company's home
United Missouri Bancshares, Inc., Kansas City, Missouri ("United Missouri"), a bank holding company
within the meaning of the Bank Holding Company Act
("BHC Act"), has applied under section 3(a)(3) of the
BHC Act (12 U.S.C. § 1842(a)(3)) to acquire all of the
voting shares of the following unaffiliated bank holding
companies ("Kansas BHCs"), and thereby indirectly
1. Asset data are as of June 30, 1992.
2. Deposit and market data as of December 31, 1991. Market share
data are based on calculations in which the deposits of thrift institutions are included at 50 percent. The Board previously has indicated
that thrift institutions have become, or have the potential to become,
significant competitors of commercial banks. See Midwest Financial
Group, 75 Federal Reserve Bulletin 386 (1989); National City Corporation, 70 Federal Reserve Bulletin 743 (1984).
Legal Developments
state, unless such acquisition is "specifically authorized by the statute laws of the State in which such
bank is located, by language to that effect and not
merely by implication." 3 For purposes of the Douglas
Amendment, the home state of United Missouri is
Missouri.4 The Kansas interstate banking statute expressly authorizes the acquisition by an out-of-state
bank holding company, such as United Missouri, of
Kansas banks, subject to certain conditions. 5 After
careful review of the relevant statutes, and in light of
the facts of record, the Board concludes that United
Missouri's acquisition of Kansas banks complies with
the Kansas interstate banking statute, and that Board
approval of this proposal is not prohibited by the
Douglas Amendment. Approval of this proposal is
conditioned upon United Missouri's receiving all required state regulatory approvals. Competitive, Financial, Managerial and Supervisory Considerations
United Missouri does not operate a banking subsidiary
in Kansas. Based on all of the facts of record in this
case, the Board concludes that consummation of this
proposal would not have a significantly adverse effect
on competition or the concentration of banking resources in any relevant banking market. The Board
notes that United Missouri will raise additional capital
to finance this acquisition, and that, upon consummation of the proposal, United Missouri's capital ratios
will be well above the regulatory minimums. Based on
these and other facts of record, the Board concludes
that the financial and managerial resources and future
prospects of United Missouri, its subsidiary banks,
and the banks to be acquired under the proposal, and
the other factors that the Board must consider under
section 3 of the BHC Act, are consistent with approval
of this proposal.
3. 12 U.S.C. § 1842(d).
4. A bank holding company's home state is that state in which the
operations of the bank holding company's banking subsidiaries were
principally conducted on July 1, 1966, or the date on which the
company became a bank holding company, whichever is later.
5. Under Kansas's interstate banking statute, a bank holding
company located in any state contiguous to Kansas, which would
include Missouri, may acquire a Kansas bank or bank holding
company if the laws of the state in which the acquiring bank holding
company is located allow Kansas bank holding companies to acquire
banks located in that state on terms that are substantially no more
restrictive than those established under Kansas's statute. Kan. Stat.
Ann. §§ 9-532, 9-535 (1991). Missouri has a comparable interstate
banking statute. Mo. Ann. Stat. § 362.925 (Vernon Supp. 1992).
Missouri and Kansas are signatories to a Cooperative Agreement
dated May 4, 1992, stating that "the reciprocal provisions of the laws
of Kansas and Missouri appear to be compatible and to permit
interstate acquisitions of banks and bank holding companies between
the two states." Under Kansas law, interstate bank acquisitions are
limited to 12 percent of total state deposits in financial institutions.
Kan. Stat. Ann. § 9-520 (1991). Under this proposal, United Missouri
would acquire less than 2 percent of total deposits in Kansas.
Convenience and Needs
127
Considerations
In considering this application, the Board is required
to take into account under the CRA the records of
United Missouri, its subsidiary banks, the Kansas
BHCs, and the Kansas Banks under the Community
Reinvestment Act (12 U.S.C. § 2901 et seq.)
("CRA"). In this regard, the Board has received
comments from the Association of Community Organizations for Reform Now ("Protestant") criticizing
the CRA performance of United Missouri and its lead
bank, United Missouri Bank, N.A., Kansas City,
Missouri ("Bank"). Protestant asserts that a review of
the May 13, 1991, and September 8, 1992, CRA
performance examinations conducted by Bank's primary regulator, the Office of the Comptroller of the
Currency ("OCC"), indicates that Bank's CRA performance has been deficient. Protestant has challenged
the satisfactory CRA rating assigned to Bank by the
OCC, because it believes that Bank's CRA program,
when compared to those of several competing financial
institutions, should be stronger in light of Bank's size,
financial condition and market share.
Protestant asserts that Bank's efforts to ascertain
community credit needs have been ineffective, that
Bank does not have formal policies in place that would
enable Bank management to properly evaluate Bank's
progress under the CRA, and that Bank's limited
outreach efforts have not resulted in the development
of new products and services to address identified
community credit needs. Protestant claims that an
analysis of the types of credit Bank has offered and
extended shows that Bank is not sufficiently meeting
identified credit needs, such as financing for singleand multi-family housing and agricultural uses. Although Protestant acknowledges that Bank has been
active in home-improvement lending in low-income
communities, Protestant asserts that Bank's lending
patterns in a number of credit products are not commensurate with Bank's market share in the low- and
moderate-income and minority areas of East Kansas
City, Missouri. Protestant also has criticized Bank's
pattern of opening and closing branch offices. 6
Protestant believes that Bank does not have an
adequate review process to ensure that its banking
practices, including Bank's loan underwriting criteria,
do not constitute discriminatory or other illegal credit
practices. Protestant also asserts that Bank's partici-
6. Protestant states that all the branches Bank has opened in its
service area over the last ten years have been in suburban or
high-income areas, and that, during this period, a need for branch
offices in low- and moderate-income and minority areas of East
Kansas City has been exacerbated by the closing of other financial
institutions that provided credit to consumers in this area.
128
Federal Reserve Bulletin • February 1993
pation in community-development activities has not
helped it to address identified credit needs, including
the need for financing for single- and multi-family
housing and financing for commercial ventures in the
low-income and minority areas in Bank's service area.
Based on these and other allegations, Protestant believes that the OCC should have assigned Bank a
rating of "substantial noncompliance" in meeting
community credit needs at its 1991 and 1992 CRA
examinations.
Record of Performance Under the CRA
A. CRA Performance Examination
The Community Reinvestment Act provides that "[i]n
connection with its examination of a financial institution, the appropriate Federal financial supervisory
agency shall . . . assess the institution's record of
meeting the credit needs of its entire community,
including low- and moderate-income neighborhoods,
consistent with the safe and sound operation of such
institution" and "take such record into account in its
evaluation of an application for a deposit facility by
such institution." 7 The CRA and the Statement of the
Federal Financial Supervisory Agencies Regarding the
Community Reinvestment Act ("Agency CRA Statement") 8 indicate that a CRA examination is an important and often controlling factor in the consideration of
an institution's CRA record and that these reports will
be given great weight in the applications process. 9
The Board believes that the CRA examination
record of Bank is of particular importance in assessing
Bank's record of CRA performance in this case,
because the OCC conducted a full-scope examination
of Bank's record of performance under the CRA
during the pendency of this application. This examination was prompted in part by the allegations made
by Protestant, and was conducted with the information
and allegations provided by Protestant. In addition,
the OCC considered the comments that Protestant
made in connection with the 1991 CRA performance
examination of Bank, which also resulted in Bank
achieving a satisfactory CRA performance rating.
Bank's primary regulator, therefore, had the opportunity to, and did, within the last 30 days, consider
Protestant's allegations in the context of a public,
on-site examination of Bank's CRA performance. The
OCC examination noted areas that require improvement in Bank's CRA performance, but concluded that
Bank's overall CRA performance was satisfactory. In
7. 12 U.S.C. § 2903.
8. 54 Federal Register 13,742 (1989).
9. Id. at 13,745.
connection with this examination, the OCC received
certain commitments by Bank to take specific steps to
address the areas noted in the examination that required improvement.
While Protestant disagrees with the conclusions and
judgments reached by the OCC, Protestant has not
provided information that was unavailable to or not
considered by the OCC in this recent examination.
Thus, while Protestant and the OCC note weaknesses
in Bank's CRA performance record, the Board believes that it must, in this case, give significant weight
to the judgment of the Bank's primary supervisor that,
in light of a full examination and the commitments
made by Bank to correct its CRA deficiencies, the
overall CRA performance of Bank is satisfactory. 10
B. Lending and Lending-Related Activities
In Bank's most recent CRA examination, the OCC
concluded that Bank's record of addressing community credit needs is satisfactory, that Bank's lending
levels reflect some responsiveness to those needs, and
that a substantial portion of Bank's loans are made to
borrowers within Bank's community delineation. In
this regard, the OCC noted that Bank's management
seeks to address identified community credit needs by
offering and originating a variety of loans, including, in
particular, small business loans, home-improvement
loans, and consumer loans.
One of the pressing community credit needs at this
time is small business loans, and the record indicates
that Bank is making small business credit available
throughout its communities. For example, Bank has
originated over $6 million in Small Business Administration-guaranteed loans to approximately 50 local
10. The remaining United Missouri banks, with two exceptions,
received either "satisfactory" or "outstanding" ratings from their
primary supervisors in the most recent examinations of their CRA
performance. United Missouri Bank of Monett, Monett, Missouri
("UMB-Monett"), received a "needs to improve" rating from the
Federal Deposit Insurance Corporation ("FDIC") as of June 1990.
The Board previously has determined that United Missouri is making
satisfactory progress in improving the CRA performance of UMBMonett. In addition, United Missouri Bank, USA ("UMB-USA"), a
credit card bank in New Castle, Delaware, received a "needs to
improve" rating from the FDIC as of February 1991. UMB-USA has
undertaken steps to improve this rating, including increased staff to
address CRA performance and more outreach efforts by the bank's
CRA officer. These two banks account for approximately 5 percent of
the assets of United Missouri. All but one of the Kansas Banks to be
acquired by United Missouri received "satisfactory" CRA ratings at
their most recent examinations. Security State Bank, Great Bend,
Kansas ("Security State"), representing less than 5 percent of United
Missouri's pro forma assets, received a "needs to improve" rating
from the FDIC as of February 14, 1991. Upon consummation of the
proposed transaction, United Missouri has agreed to take certain
specific steps to improve the deficient areas of Security State's CRA
program, and to implement the types of CRA programs that have been
or will be implemented at United Missouri's other subsidiary banks.
Legal Developments
businesses since May 1991, with approximately onethird of the dollar volume of those loans going to
businesses in low- to moderate-income areas of the
community. At present, Bank has a small business
loan portfolio of approximately $200 million.
With regard to home-improvement loans, the OCC
noted that Bank is actively involved in a Missouri
Housing Development Commission program to provide state-subsidized home-improvement loans. Bank
also participates in the Federal Housing Authority's
Title I program to provide federally guaranteed homeimprovement loans. Bank also originates subsidized
home-improvement loans in connection with the Kansas City Power and Light Company's home weatherization program. The OCC determined that approximately 12 percent of loans originated by Bank during
1992 have been for consumer purposes, including
home-improvement loans.
The OCC found that Bank's lending levels for homepurchase loans have been satisfactory over the past
two years. With respect to residential mortgage loans,
the OCC noted that Bank's mortgage company affiliate
participates in a program sponsored by the Rehabilitation Loan Corporation ("RLC") to provide affordable home loans to low- and moderate-income firsttime home buyers. Bank personnel also provide
lending expertise to the RLC by prequalifying applicants for these loans. The mortgage company affiliate
also offers an affordable home loan program in partnership with the City of Kansas City, Missouri. During
the first three quarters of 1992, Bank's mortgage
company affiliate has originated home-purchase loans
totalling approximately $4 million, with approximately
30 percent of these loans made to borrowers residing
in low- and moderate-income areas.
C. Ascertainment and Marketing
Although the OCC found some areas for improvement
in this aspect of Bank's CRA performance, the OCC
examination report noted that many of Bank's officers
and employees are either active in or have regular
contact with a large number of civic, neighborhood,
religious, minority, fraternal, business, and real estate
groups throughout the metropolitan Kansas City area.
These groups represent different interests within the
bank's delineated community. Bank's mortgage company affiliate also participates in the bank's ascertainment efforts. Senior officers of the mortgage company
regularly consult and work with local realtors and local
community development corporations regarding housing and lending issues. Bank also has a business
development group that calls on existing and prospective commercial businesses, focusing on small- to
medium-sized businesses. In addition, the bank has
129
ongoing contacts with, and receives referrals from,
small business development centers located in its
community.
Bank markets its products and services through a
variety of advertising activities, including direct mail,
statement stuffers, brochures, lobby signs, billboards,
neighborhood and regional newspapers, radio, and
television. Bank advertises in all of its delineated
communities, and advertises in both English and Spanish. Loan personnel also meet with neighborhood
associations and realtor groups to provide information
to individuals regarding Bank's home-improvement
and home loan programs. In Bank's most recent CRA
examination report, the OCC concluded that Bank has
implemented an effective marketing program that communicates credit programs to the entire community.
D. Corporate Policies
Bank has in place some of the policies that contribute
to an effective CRA program, as outlined in the
Agency CRA Statement. For example, Bank's board
of directors has adopted a detailed CRA statement,
and Bank's board of directors has formed a committee
of bank and holding company officers who are responsible for consumer compliance matters, including CRA
compliance. Bank's CRA coordinator is responsible
for documenting the bank's CRA activities, providing
regular reports to management on such activities, and
disseminating information within the bank regarding
Bank's CRA responsibilities.
The Board also notes that, in connection with
Bank's most recent CRA examination by the OCC,
United Missouri has committed to take a number of
significant steps to strengthen all aspects of Bank's
CRA programs, including the implementation of a
more comprehensive CRA program. These commitments include the establishment of a board-level CRA
committee, increased documentation for its CRA program, enhanced procedures for monitoring its marketing programs, procedures for CRA self-assessments,
and improved procedures for ensuring compliance
with applicable CRA regulations. Compliance with
these commitments will be monitored through the
OCC's examination process, and by the Board in its
consideration of future applications, and Bank's progress in complying with all commitments regarding
CRA performance will be carefully considered in
connection with future applications by United Missouri to expand its deposit-taking facilities.
E. Branch Locations
Bank has 25 branches located throughout Jackson,
Platte and Clay Counties in Missouri. The OCC found
130
Federal Reserve Bulletin • February 1993
that Bank's branches have convenient business hours
and are reasonably accessible to all segments of its
delineated community. In addition, the closure of any
of Bank's branches is subject to a formal written policy
requiring certain steps be taken to assess and minimize
the potential adverse impact of closing a branch.
Bank's management has also committed to conduct
an annual review of the location and business hours of
its branches. This review will include an evaluation of
the appropriateness of services offered, and the accessibility of branch locations, to all segments of Bank's
delineated community.
F. Conclusion Regarding Convenience and
Needs Factors
The Board has carefully considered all of the facts of
record, including the comments filed in this case, in
reviewing Bank's CRA record under the BHC Act.
Based on a review of the entire record of performance,
including, in particular, the CRA performance examination of Bank recently concluded by the OCC, as well
as the commitments provided by United Missouri and
Bank, the CRA performance examinations of the other
relevant banks, and the information provided by Protestant and United Missouri, the Board believes that the
efforts of United Missouri, the Kansas BHCs, and their
subsidiary banks to help meet the credit needs of all
segments of the communities served by these banks,
including low- and moderate-income areas, are, on
balance, consistent with approval of these applications.11
Based on the foregoing, including the conditions and
commitments described in this Order and those made
in these applications, and all of the facts of record, the
Board has determined that the applications should be,
and hereby are, approved. The Board's approval is
specifically conditioned upon compliance with all the
commitments made by United Missouri in connection
with these applications. All of the commitments and
conditions relied upon by the Board in reaching its
decision are both commitments imposed in writing by
11. Protestants have requested that the Board hold a public meeting
or hearing on these applications. The Board is not required under the
BHC Act to hold a public hearing or meeting in this case. Under the
Board's rules, the Board may, in its discretion, hold a public hearing
or meeting on an application to clarify factual issues related to the
application, and to provide an opportunity for testimony, if appropriate. 12 C.F.R. 262.3(e) and 262.25(d). The Board has carefully considered this request. In the Board's view, interested parties have had
a sufficient opportunity to present written submissions, and have
submitted substantial written comments that have been considered by
the Board. In light of this, the Board has determined that a public
meeting or hearing is not necessary to clarify the factual record in
these applications, or otherwise warranted in this case. Accordingly,
the request for a public meeting or hearing on these applications is
hereby denied.
the Board in connection with its findings and decision,
and may be enforced in proceedings under applicable
laws. This approval is also conditioned upon United
Missouri's receiving all necessary Federal and state
approvals. 12
The transaction approved in this Order shall not be
consummated before the thirtieth calendar day following the effective date of this Order, or later than three
months after the effective date of this Order, unless
such period is extended for good cause by the Federal
Reserve Bank of Kansas City, pursuant to delegated
authority.
By order of the Board of Governors, effective
December 22, 1992.
Voting for this action: Chairman Greenspan and Governors
Mullins, Kelley, La Ware, and Phillips. Voting against this
action: Governor Lindsey. N o t participating in the consideration of this action: Governor Angell.
JENNIFER J . JOHNSON
Associate Secretary of the Board
Dissenting Statement of Governor Lindsey
The OCC's most recent CRA examination of United
Missouri's lead bank noted a number of significant
weaknesses in Bank's record of compliance. The OCC
determined that the CRA performance record of Bank
was nonetheless satisfactory, and received certain
commitments made by United Missouri to address
each of the noted deficiencies. I believe that the
deficiencies noted in the public CRA examination in
this case are significant, and that it is inappropriate for
the Board to rely so heavily, in the applications
process, on commitments regarding prospective behavior. I believe commitments to improve Bank's
CRA performance are particularly inappropriate in
this case because Bank has significant resources,
represents a substantial part of United Missouri's
assets, and has a well-established retail banking network in place. The Agency CRA Statement requires
that the CRA policies of an applicant and its subsidiary
banks should be in place and working well when an
application is considered. In this case, I believe that
the record indicates that Bank's CRA policies are not
adequate. For these reasons, I would deny the application pending before the Board.
December 22, 1992
12. In this regard, the Board notes that, on August 17, 1992, the
State of Kansas Banking Board approved the applications filed by
United Missouri under Kansas law to acquire the Kansas BHCs and
thereby indirectly acquire the Kansas Banks. This state approval was
conditioned upon United Missouri's obtaining all necessary Federal
approvals.
Legal Developments
Orders Issued Under Section 4 of the Bank
Holding Company Act
The Dai-Ichi Kangyo Bank, Ltd.
Tokyo,Japan
Chemical Banking Corporation
New York, New York
Order Approving Application to Engage in
Collection Agency Activities, and in Asset
Management, Servicing, and Collection Activities
The Dai-Ichi Kangyo Bank, Ltd., Tokyo, Japan ("DaiIchi"), and Chemical Banking Corporation, New
York, New York ("Chemical") (collectively referred
to as "Applicants"), both bank holding companies
within the meaning of the Bank Holding Company Act
("BHC Act"), have applied under section 4(c)(8) of
the BHC Act (12 U.S.C. § 1843(c)(8)) and section
225.23(a)(3) of the Board's Regulation Y (12 C.F.R.
225.23(a)(3)), to engage de novo in collection agency
activities pursuant to section 225.25(b)(23) of the
Board's Regulation Y through The CIT Group Holdings, Inc., New York, New York ("Holdings"), and in
asset management, servicing, and collection activities
through The CIT Group/Asset Management, Inc.,
Livingston, New Jersey ("CIT"). 1
Notice of the applications, affording interested persons an opportunity to submit comments, has been
published (57 Federal Register 7589 and 43,229
(1992)). The time for filing comments has expired, and
the Board has considered the application and all
comments received in light of the factors set forth in
section 4(c)(8) of the BHC Act.
Dai-Ichi, with total consolidated assets equivalent to
approximately $476.1 billion, is the largest banking
organization in the world. 2 Dai-Ichi owns a bank
subsidiary in Los Angeles, California; operates
branches in Chicago, Illinois, and New York, New
York; and operates agencies in Los Angeles, California; San Francisco, California; and Atlanta, Georgia.
Dai-Ichi also engages in various nonbanking activities
in the United States through a number of subsidiaries,
including CIT.
Chemical, with total consolidated assets of
$138.8 billion, is the third largest banking organization
in the United States. Chemical operates 25 subsidiary
1. Holdings is a joint venture in which Dai-Ichi and Chemical own
60 percent and 40 percent, respectively. CIT is a wholly owned
subsidiary of Holdings.
2. Asset data are as of March 31, 1992. Ranking is as of December 31, 1991.
131
banks and engages directly and through subsidiaries,
including CIT, in a variety of nonbanking activities.3
The Board has previously determined by regulation
that the collection agency activities that Applicants
propose to conduct are closely related to banking for
purposes of section 4(c)(8) of the BHC Act. 4 Applicants propose to conduct these activities through
Holdings in accordance with the Board's regulations.
Accordingly, the Board concludes that the proposed
collection agency activities are permissible for purposes of section 4(c)(8) of the BHC Act and section
225.25(b)(23) of the Board's Regulation Y.
CIT will provide asset management services to the
Resolution Trust Corporation ("RTC") and the Federal Deposit Insurance Corporation ("FDIC"). 5 In
addition, CIT proposes to provide these services to
unaffiliated third party investors that purchase pools of
assets assembled by the RTC or the FDIC from
troubled financial institutions, and generally to unaffiliated financial and non-financial institutions with troubled assets. Under the proposal, neither Applicants
nor CIT would acquire an ownership interest in the
assets that they manage or in the institutions for which
they provide asset management services. In addition,
CIT would not engage in providing real property
management or real estate brokerage services as part
of its proposed activities. 6
The Board has previously determined that, within
certain parameters, providing asset management services for assets originated by financial institutions 7 and
their bank holding company affiliates is an activity that
is closely related to banking for purposes of the BHC
Act. 8 Applicants have proposed to conduct all asset
3. Data for Chemical are as of September 30, 1992.
4. See 12 C.F.R. 225.25(b)(23).
5. Asset management encompasses the liquidation (or other disposition) of loans and their underlying collateral, including real estate
and other assets acquired through foreclosure or in satisfaction of
debts previously contracted ("DPC property"). Specific individual
activities include: classifying and valuing loan portfolios; filing reviews of loan documentation; developing collection strategies; negotiating renewals, extensions, and restructuring agreements; initiating
foreclosure, bankruptcy, and other legal proceedings, where appropriate; and developing and implementing market strategies for the sale
or refinancing of individual loans and for the packaging and sale of
whole or securitized loan portfolios. In addition, Applicants would
conduct and review (either directly or through independent contractors) appraisals and environmental inspections; provide asset valuations; perform cash-flow and asset-review analyses; contract with and
supervise independent property managers; and lease (either directly
or through independent contractors) real estate and other DPC property. Applicants also would dispose of DPC property by developing
and implementing marketing strategies for the sale of DPC property,
either individually or packaged for investors or developers.
6. Applicants will contract with independent third parties to obtain
these services for assets under the management of CIT.
7. Financial institutions include banks, savings associations, and
credit unions.
8. See First Interstate Bancorp, 11 Federal Reserve Bulletin 334
(1991); Banc One Corporation, 11 Federal Reserve Bulletin 331 (1991);
132
Federal Reserve Bulletin • February 1993
management activities under the same terms, and
subject to the same conditions as in previous Board
Orders regarding this activity. 9 For example, Applicants have committed that they will not own the stock
of, or be represented on the board of directors of, any
unaffiliated institution for which CIT provides asset
management services. In addition, Applicants have
committed that CIT will not establish policies or
procedures of general applicability for the institutions
whose assets it manages, and that the services of CIT
for unaffiliated institutions would be limited to asset
management, servicing, and collection activities.10
Applicants propose to engage in asset management
activities for assets originated by non-financial institutions as well as financial institutions.11 These assets,
however, would be limited to the types of assets that a
financial institution would have the authority to originate. 12 Accordingly, the Board believes that Applicants would have the expertise to engage in the
management of these types of assets, regardless of the
originating entity, and that the proposal is within the
scope of the asset management approval in the
Board's prior Orders. For these reasons, the Board
concludes that Applicants' proposed activities are
closely related to banking.
The Board is also required to determine whether the
performance of the proposed activity by Applicants is
a proper incident to banking—that is, whether the
proposed activity "can reasonably be expected to
produce benefits, such as greater convenience, increased competition, or gains in efficiency, that outweigh possible adverse effects, such as undue concentration of resources, decreased or unfair competition,
conflicts of interests, or unsound banking practices."
12 U.S.C. § 1843(c)(8).
NCNB Corporation, 11 Federal Reserve Bulletin 124 (1991); First
Florida Banks, Inc., 14 Federal Reserve Bulletin 111 (1988).
9. Id.
10. Applicants also would provide these services for a limited period
of time. The Board notes that, while Applicants would manage assets
on an ongoing basis, the owner of the assets would retain the right to
make all final decisions regarding asset dispositions and to terminate
Applicants as asset manager.
11. These assets include real estate; commercial, consumer and
other loans; equipment leases; and extensions of credit. Non-financial
institutions include pension funds, leasing companies, finance companies, and investment companies formed to engage in asset management activities.
12. These assets would include: equipment leases that conform to
section 225.25(b)(5) of the Board's Regulation Y (12 C.F.R.
225.25(b)(5)); loans secured by equipment and equipment acquired
through foreclosure or in satisfaction of such leases and loans;
consumer loans financing manufactured housing, vessels, vehicles,
and residences; asset-based commercial loans; factored accounts
receivables; and collateral for the aforementioned types of loans
acquired through foreclosure or in satisfaction of such loans. Prior
approval of the Board would be required before providing asset
management services in connection with pools of assets of the type
impermissible for a financial institution to originate.
Consummation of the proposal can reasonably be
expected to result in public benefits. Applicants' proposal would facilitate the disposal of assets of financial
institutions in receivership as well as financial and
non-financial institutions with troubled financial assets. Moreover, the efficient disposition of such assets
can reasonably be expected to produce benefits to the
public. CIT will own no equity in the institutions for
which it provides asset management services or in the
assets it manages. Applicants' de novo entry into the
market would increase competition for these services.
Applicants have indicated that they may, in certain
instances, seek approval to acquire institutions whose
assets are being managed by CIT. In previous cases,
the Board expressed concern that a bank holding
company might obtain confidential information in the
course of providing its asset management services that
would provide the bank holding company with a
competitive advantage over other institutions in the
bidding process for the failed institution under management.13 The Board also noted that such information
could give the managing bank holding company a
competitive advantage over the ultimate acquiror of
the failed institution in markets where they both compete.
To address these concerns, Applicants have committed that they will establish and implement procedures to preserve the confidentiality of information
obtained in the course of providing asset management
services. 14 These procedures will prevent the use of
information obtained by CIT through its asset management activities in the course of preparing any bid that
Applicants may prepare to acquire an institution managed by CIT, and will prevent Applicants from competing unfairly against the winning bidder in the relevant market.
There is no evidence in the record to indicate that
consummation of these proposals is likely to result in
any significantly adverse effects, such as undue concentration of resources, decreased or unfair competition, conflicts of interests, or unsound banking practices. The financial and managerial resources of
Applicants and their subsidiaries are also consistent
with approval. Accordingly, on the basis of all of the
facts of record and commitments made by Applicants,
the Board concludes that the public benefits that
would result from approval of these applications outweigh the potential adverse effects, and that the public
interest factors it must consider under section 4(c)(8)
of the BHC Act are consistent with approval.
13. See, e.g., NCNB Corporation, 11 Federal Reserve Bulletin 124
(1991).
14. Applicants' procedures will be subject to review by the Federal
Reserve System.
Legal Developments
Based upon the foregoing and all of the other facts of
record, including commitments made by Applicants
and conditions in this Order, the Board has determined
that these applications should be, and hereby are,
approved. The Board's approval is expressly conditioned upon compliance with all of the commitments
made by Applicants in connection with these applications and the conditions referred to in this Order and
the above-referenced Orders. For the purpose of this
action, all of these commitments and conditions will be
considered conditions imposed in writing and, as such,
may be enforced in proceedings under applicable law.
The Board's determination is also subject to all of the
conditions set forth in the Board's Regulation Y,
including those in sections 225.4(d) and 225.23(b), and
to the Board's authority to require modification or
termination of the activities of a bank holding company or any of its subsidiaries as the Board finds
necessary to assure compliance with, and to prevent
evasion of, the provisions of the BHC Act and the
Board's Regulations and Orders issued thereunder.
These transactions shall not be consummated later
than three months after the effective date of this
Order, unless such period is extended for good cause
by the Board or by the Federal Reserve Bank of San
Francisco, acting pursuant to delegated authority.
By order of the Board of Governors, effective
December 21, 1992.
Voting for this action: Chairman Greenspan and Governors
Mullins, Angell, Kelley, La Ware, Lindsey, and Phillips.
JENNIFER J . JOHNSON
Associate Secretary of the Board
Deutsche Bank AG
Frankfurt, Federal Republic of Germany
Order Approving Application to Retain the U.S
Subsidiaries of Morgan Grenfell pic, London,
England, and Thereby to Engage in
Securities-Related Activities and Other Nonbanking
Activities
Deutsche Bank AG, Frankfurt, Federal Republic of
Germany ("Applicant"), a foreign bank subject to the
Bank Holding Company Act (the "BHC Act"), has
applied for the Board's approval under section 4(c)(8)
of the BHC Act (12 U.S.C. § 1843(c)(8)), to retain all
of the shares of Morgan Grenfell U.S. Holdings Incorporated ("Holdings"). Holdings owns all of the shares
of the U.S. subsidiaries of Morgan Grenfell Group pic,
a merchant bank located in London, England. In
proposing to retain all of Holdings' shares, Applicant
133
would retain the shares of C.J. Lawrence, Inc. ("Company"), New York, New York, which engages in:
(i) Underwriting and dealing in all types of debt
and equity securities;1
(ii) Offering investment advice and securities brokerage services, separately and on a combined
basis;
(iii) Underwriting and dealing in securities which
may be underwritten and dealt in by state member
banks;
(iv) Offering financial advisory services;
(v) Engaging in the private placement of all types
of securities as agent; and
(vi) Buying and selling all types of securities on
the order of investors as a "riskless principal."
Applicant also proposes to retain indirectly Morgan
Grenfell Finance, Incorporated ("Finance"), New
York, New York, which acts as:
(i) An originator and principal in interest rate
swap transactions on a limited basis related to its
own portfolio;
(ii) An originator and principal with respect to
certain interest rate risk-management products
such as caps, floors and collars, as well as options
on swaps ("swap derivative products");
(iii) A broker or agent with respect to the foregoing transactions and instruments and currency
swaps and currency swap derivative products;
and
(iv) An advisor to institutional customers regarding financial strategies involving interest rate and
currency swaps and swap derivative products.
Applicant also proposes that Finance purchase and
sell gold bullion for Finance's own account. 2 Applicant also has applied to retain indirectly Morgan
Grenfell Capital Management Incorporated, New
York, New York, which engages in offering portfolio
investment advice. 3
1. Applicant has not proposed to underwrite or deal in securities
issued by open-end investment companies and accordingly, may not
do so without further application under section 4(c)(8) of the BHC
Act.
2. Applicant proposes that Finance purchase and sell options,
futures, and options on futures with respect to gold bullion in order to
hedge its position in gold bullion in accordance with the Board's
Policy Statement, Statement of policy concerning bank holding companies engaging in futures, forward and options contracts on U.S.
Government and agency securities and money market instruments,
12 C.F.R. 225.142.
3. Company, Finance and Management are owned by Holdings.
Holdings also controls Cyrus J. Lawrence Capital Holdings, Inc.,
New York, New York, which purchases investments in companies in
accordance with the BHC Act. All of these entities are referred to
collectively as "Companies."
134
Federal Reserve Bulletin • February 1993
Notice of the application, affording interested persons an opportunity to submit comments on the proposal, has been duly published (55 Federal Register
29,416 (1990)).4 The time for filing comments has
expired, and the Board has considered the application
and all comments received in light of the public
interest factors set forth in section 4(c)(8) of the BHC
Act.
Underwriting and Dealing in Bank-Ineligible
Securities
The Board has determined that, subject to the prudential framework of limitations established in previous
decisions to address the potential for conflicts of
interests, unsound banking practices, or other adverse
effects, the proposed underwriting and dealing activities are so closely related to banking as to be proper
incidents thereto within the meaning of section 4(c)(8)
of the BHC Act. 5 The Board has also determined that
4. The Board received comments from the Investment Company
Institute ("ICI"), a trade association representing the investment
company industry. The ICI has protested the application to the extent
that it could be read to permit:
(1) Sponsoring, organizing, and managing three open-end funds;
(2) Sponsoring, organizing, and managing closed-end funds, unless
the fund is not "primarily or frequently engaged in the issuance,
sale, and distribution of securities;"
(3) Private placement of securities issued by investment companies
that are advised or sponsored by Applicant or any of its bank or
nonbank subsidiaries;
(4) Providing discount or full service brokerage services with
respect to securities issued by investment companies that are
advised or sponsored by Applicant or any of its bank or nonbank
subsidiaries;
(5) Acting as riskless principal with respect to securities issued by
investment companies that are advised or sponsored by Applicant
or any of its bank or nonbank subsidiaries;
(6)(i) Privately placing, (ii) offering discount or full-service brokerage, or (iii) acting as riskless principal with respect to securities
issued by investment companies that are advised or sponsored by
Applicant's bank affiliates or subsidiaries of its bank affiliates; and
(7) The acquisition of securities representing interests in unit
investment trusts sponsored by the Applicant or any of its bank or
nonbank affiliates.
As discussed throughout the Order, Applicant would conduct its
activities involving investment companies in compliance with prior
Board orders. Accordingly, the ICI's comments do not warrant denial
of the proposal.
5. J.P. Morgan & Company Incorporated, The Chase Manhattan
Corporation, Bankers Trust New York Corporation, Citicorp, and
Security Pacific Corporation, 75 Federal Reserve Bulletin 192 (1989)
("J.P. Morgan & Company Incorporated, et al.")', Chemical New
York Corporation, et ai, 73 Federal Reserve Bulletin 731 (1987);
Citicorp, et ai, 73 Federal Reserve Bulletin 473 (1987), ajfd sub nom.
Securities Industry Association v. Board of Governors of the Federal
Reserve System, 839 F.2d 47 (2d Cir. 1988), cert, denied, 486 U.S.
1059 (1988); as modified by Order, dated September 21, 1989,
75 Federal Reserve Bulletin 751 (1989) ("Modification Order"), ajfd
sub nom. Securities Industry Association v. Board of Governors of the
Federal Reserve System, 900 F.2d 360 (D.C. Cir. 1990) (collectively,
"section 20 orders").
In Canadian Imperial Bank of Commerce, The Royal Bank of
Canada, Barclays PLC, and Barclays Bank PLC, 76 Federal Reserve
Bulletin 158 (1990) ("Canadian Imperial, et al."), the Board consid-
the conduct of these securities underwriting and dealing activities is consistent with section 20 of the
Glass-Steagall Act, provided that the underwriting
and dealing subsidiary derives no more than 10 percent
of its total gross revenue from underwriting and dealing in bank-ineligible securities over any two-year
period. 6 Applicant has committed that Company will
conduct its underwriting and dealing activities with
respect to bank-ineligible securities subject to the 10
percent revenue test established by the Board in its
previous orders, and to the prudential limitations
established by the Board in its Canadian Imperial,
et al. order. 7
Applicant's proposal is broad enough to include
underwriting and dealing in shares of closed-end investment companies and unit investment trusts (but
not open-end investment companies, i.e., mutual
funds). 8 Underwriting or dealing activities involving
investment company securities under this Order must
be conducted in accordance with the limitations contained in the existing provisions of Regulation Y
authorizing bank holding companies to provide advisory activities to investment companies. In particular,
Regulation Y provides that a bank holding company
and its subsidiaries may not purchase for their own
account, or engage directly or indirectly in the sale or
distribution of, the securities of any investment company that the holding company advises or sponsors.
12 C.F.R. 225.125(g)(1), (h). This regulation applies to
ered and approved applications by foreign banks to engage in underwriting and dealing in all types of debt and equity securities. In that
order, the Board modified the prudential framework imposed in J.P.
Morgan & Company Incorporated, et al., to account for the fact that
the applicants were foreign banks that operate predominately outside
the United States. The Board determined in those decisions to adjust
the funding and certain operational requirements of the framework
previously established for those activities in order to take into account
principles of national treatment and the Board's policy not to extend
U.S. bank supervisory standards extraterritorially. See also The
Toronto-Dominion Bank, 76 Federal Reserve Bulletin 573 (1990);
Canadian Imperial Bank of Commerce, 76 Federal Reserve Bulletin
548 (1990). The Board hereby adopts and incorporates herein by
reference the reasoning and analysis from the section 20 orders except
as that reasoning was specifically modified by the Canadian Imperial,
et al. order, as well as the reasoning and analysis contained in the
Canadian Imperial, et al. order.
6. Canadian Imperial, et al.; Modification Order; and J.P. Morgan
& Company Incorporated, et al.
1. Compliance with the revenue limits shall be calculated in the
manner set forth in J.P. Morgan & Company Incorporated, et al., 75
Federal Reserve Bulletin 192, 196-197 (1989).
8. At the time Applicant acquired Company, pursuant to the
Board's grant of an exemption under section 4(c)(9) of the BHC Act,
Company was involved in the distribution of open-end investment
companies. Company has ceased this activity. The ICI protested the
application to the extent that Company would sponsor, organize, or
martage closed-end investment companies, unless such investment
company was not "primarily or frequently engaged in the issuance,
sale, and distribution of securities." If an investment company were
engaged in such activities, it would not be considered to be a
"closed-end" investment company. Accordingly, Applicant has not
requested authority to engage in such activity.
Legal Developments
all types of investment companies, including unit
investment trusts.
Private Placement and "Riskless
Activities
Principal"
The Board has previously determined that, subject to
certain prudential limitations established to address
the potential for conflicts of interests, unsound banking practices or other adverse effects, the proposed
private placement and riskless principal activities are
so closely related to banking as to be proper incidents
thereto within the meaning of section 4(c)(8) of the
BHC Act. 9 The Board has also previously determined
that acting as agent in the private placement of securities and purchasing and selling securities on the order
of investors as a "riskless principal" do not constitute
underwriting and dealing in securities for purposes of
section 20 of the Glass-Steagall Act, and that revenue
derived from these activities is not subject to the 10
percent revenue limitation on ineligible securities underwriting and dealing.10 Applicant has committed that
Company and Finance will conduct their private placement and "riskless principal" activities using the same
methods and procedures, and subject to the same
prudential limitations established by the Board in the
Bankers Trust and the J.P. Morgan orders, as modified to reflect Applicant's status as a foreign bank,
except as noted below. 11
Applicant has proposed to have its affiliated banks,
branches, and agencies extend credit to an issuer
whose debt securities have been placed by Company
or Finance where the proceeds would be used to pay
the principal amount of the debt securities at maturity.
Applicant has committed that these extensions of
credit will conform to the limitations set forth in the
Board's decision in J.P. Morgan, including the requirement that a period of at least three years elapse
from the time of the placement of the securities to the
decision to extend credit; that Applicant maintain
adequate documentation of these transactions and
9. J.P. Morgan & Company Incorporated, 76 Federal Reserve
Bulletin 26 (1990) ("J.P. Morgan"); Bankers Trust New York Corporation, 75 Federal Reserve Bulletin 829 (1989) ("Bankers Trust").
10. Id. The ICI has objected to Applicant's proposal to the extent
that it could be construed to seek approval for Company to privately
place securities of investment companies sponsored or advised by
Applicant or its bank or nonbank affiliates. Applicant has not requested approval to place such securities.
In addition, the ICI objected to Applicant's proposal to the extent
that it could be construed to seek approval for Company to act as
riskless principal with respect to securities of investment companies
sponsored or advised by Applicant or its bank or nonbank affiliates.
Applicant has not requested approval to act as riskless principal with
respect to such securities.
11. See, e.g., The Toronto-Dominion Bank, 76 Federal Reserve
Bulletin 573 (1990).
135
decisions; and that the extensions of credit meet
prudent and objective standards as well as the standards set out in section 23B of the Federal Reserve
Act. 12 The Federal Reserve Bank of New York will
closely review loan documentation of Applicant's
branches to ensure that an independent and thorough
credit evaluation has been undertaken with respect to
the participation of those institutions in these credit
extensions to issuers of securities privately placed by
an agent affiliated with those institutions.
Applicant also has proposed to have Company place
securities with Applicant or its nonbank subsidiaries
consistent with the Board's decision in J.P. Morgan.
In this regard, Applicant will establish both individual
and aggregate limits on the investment by affiliates of
Company and Finance in any particular issue of securities that is placed by Company or Finance and will
establish appropriate internal policies, procedures,
and limitations regarding the amount of securities of
any particular issue placed by Company or Finance
that may be purchased by Applicant and each of its
nonbanking subsidiaries, individually and in the aggregate. 13 These policies and procedures, as well as the
purchases themselves, will be reviewed by the Federal
Reserve Bank of New York.
Applicant has requested that Company be permitted
to privately place unrated securities of affiliates or
unrated securities representing assets of affiliates with
individuals whose net worth exceeds $1 million. The
Board has previously approved such placement with
sophisticated institutions only. The Board believes
that this modification would not result in significant
adverse effects since these customers would be financially sophisticated with the expertise to evaluate
independently the merits of the securities. 14 Accordingly, Company may place unrated securities of affiliates with individuals who fall within the definition of
"institutional investor" in Regulation Y, that is, individuals whose net worth (or net worth with a spouse)
exceeds $1 million. 12 C.F.R. 225.2(g).
The Board has previously determined by regulation
that full-service brokerage activities are permissible
for bank holding companies under section 4(c)(8) of
12. 12 U.S.C. § 371c-l.
13. The limit established shall not exceed 50 percent of the issue
being placed. Additionally, in the development of these policies and
procedures, Company will incorporate, with respect to placements of
securities, the limitation established by the Board in condition 12 of its
J.P. Morgan & Company Incorporated et al. order regarding aggregate exposure of the holding company on a consolidated basis to any
single customer whose securities are underwritten, dealt in, or placed
by Company.
14. See, e.g., Banc One Corporation, 76 Federal Reserve Bulletin
756 (1990).
136
Federal Reserve Bulletin • February 1993
the BHC Act. 15 Applicant proposes that Company
engage in these activities in accordance with all of the
conditions set forth in Regulation Y. 16 In addition,
Company will provide discretionary investment management services for institutional customers only,
subject to the same terms and conditions as previously
approved by the Board. 17
Financial Advisory
Activities
Applicant has proposed that Company engage in the
following advisory activities:
(1) Acting as a financial advisor by rendering advice
with respect to arranging, structuring, financing, and
negotiating domestic and international mergers, acquisition, divestitures, recapitalizations, joint ventures, leveraged buyouts, financing transactions and
other corporate transactions for affiliated and unaffiliated financial and nonfinancial institutions and
high net worth individuals, and to provide ancillary
services or functions incidental to these activities;
(2) Providing valuation services in connection with
corporate transactions to affiliated and unaffiliated
financial and nonfinancial institutions and high net
worth individuals;
(3) Providing fairness opinions in connection with
corporate transactions to affiliated and unaffiliated
financial and nonfinancial institutions and high net
worth individuals; and
(4) Providing financial feasibility studies,18 principally in the context of determining the financial
attractiveness and feasibility of corporate transactions to corporations (collectively "financial advisory services").
The Board has previously approved these activities by
regulation for bank holding companies. Applicant pro-
15. 12 C.F.R. 225.25(b)(4) and (15)(ii); 57 Federal Register 41,381
(1992).
16. When providing full-service brokerage with respect to ineligible
securities that it holds as principal, Company will provide customers
with disclosure statements as previously approved by the Board. See
PNC Financial Corporation, 75 Federal Reserve Bulletin 396, 397
(1989). Specifically, Company will inform its customers at the commencement of the relationship that, as a general matter, Company
may be a principal or may be engaged in underwriting with respect to,
or may purchase from an affiliate, those securities for which brokerage
and advisory services are provided. At the time any brokerage order
is taken, the customer will be informed (usually orally) whether
Company is acting as agent or principal with respect to a security.
Confirmations sent to customers also will state whether Company is
acting as agent or principal.
17. See J.P. Morgan & Co. Incorporated, 73 Federal Reserve
Bulletin 810 (1987).
18. Feasibility studies do not include assisting management with
planning or marketing for a given project or providing general operational or management advice.
poses to conduct these activities in accordance with
Regulation Y. 12 C.F.R. 225.25(b)(4)(vi).
Swap Activities
The Board has previously determined by order that the
proposed swaps and swap derivative products activities are closely related to banking and permissible for
bank holding companies within the meaning of section
4(c)(8) of the BHC Act. 19 The Board must also find
that the proposed activities "can reasonably be expected to produce benefits to the public . . . that
outweigh possible adverse effects, such as undue
concentration of resources, decreased or unfair competition, conflicts of interests, or unsound banking
practices." 12 U.S.C. § 1843(c)(8).
Finance appears to be capable of managing the risks
associated with the proposed activities. Applicant's
subsidiary, Morgan Grenfell pic, which has extensive
experience in lending and financing services worldwide, has undertaken to provide credit screening for
all potential counterparties of Finance through its
credit desk services in London. In appropriate cases,
Finance will obtain a letter of credit on behalf of, or
collateral from, a counterparty. 20 In addition, Finance
will establish separate credit risk exposure limits for
each swap counterparty. Finance will monitor this
exposure on an ongoing basis, in the aggregate and
with respect to each counterparty. Senior management
will be periodically informed of the potential risk to
which Finance is exposed.
In order to manage the risk associated with adverse
changes in interest rates ("price risk"), Finance will
match all the swaps and related instruments in which it
is a principal and will hedge any unmatched positions
pending a suitable match. Finance will not enter into
unmatched or unhedged swaps for speculative purposes. Finance's management will set absolute limits
on the level of risk to which its swap portfolio may be
exposed. Finance's exposure to price risk will be
monitored by both business management and internal
auditing personnel to guarantee compliance with the
risk limitations imposed by management. Auditing
personnel will report directly to senior management to
ensure that any violations of portfolio risk limitations
are reported and corrected.
With respect to the risk associated with the potential
for differences between the floating rate indices on two
matched or hedged swaps ("basis risk"), Finance's
management will impose absolute limits on the aggre-
19. The Sumitomo Bank, Limited, 75 Federal Reserve Bulletin 582
(1989) ("Sumitomo Bank").
20. Applicant has indicated that Morgan Grenfell pic may be the
provider of the letter of credit.
Legal Developments
gate basis risk to which Finance's swaps portfolio may
be exposed. If the level of risk threatens to exceed the
limits at any time, Finance will actively seek to enter
into matching transactions for its unmatched positions. Finance's internal auditing staff, together with
management, will monitor compliance with the management-imposed basis risk limits.21
In order to minimize any possible conflicts of interest between Finance's role as a principal or broker in
swap transactions and its role as advisor to potential
counterparties, Finance will disclose to each customer
the fact that Finance may have an interest as a
counterparty, principal, or broker in the course of
action ultimately chosen by the customer. Also, in any
case in which Finance has an interest in a specific
transaction as an intermediary or principal, Finance
will advise its customer of that fact before recommending participation in that transaction. 22 In addition, Finance's advisory services will be offered only
to sophisticated customers who would be unlikely to
place undue reliance on investment advice received
and better able to detect investment advice motivated
by self-interest.
In considering activities related to swap transactions, the Board has expressed its concerns regarding
conflicts of interest and related adverse effects that,
absent certain limitations, may be associated with
financial advisory activities. In order to address these
potential adverse effects, Applicant has committed
that:
(i) Finance's financial advisory activities will not
encompass the performance of routine tasks or
operations for a client on a daily or continuous
basis;
(ii) Disclosure will be made to each potential
client of Finance that Finance is an affiliate of
Applicant;
(iii) Finance will not make available to Applicant
or any of Applicant's subsidiaries confidential
information received from Finance's clients, except with the client's consent; and
(iv) Advice rendered by Finance on an explicit fee
basis will be without regard to correspondent
balances maintained by a client of Finance at
Applicant or any of Applicant's depository subsidiaries.
21. In addition to rate and basis risk, the value of a swap option is
subject to market expectations of the future direction and rate of
change in interest rates, or volatility risk. Finance's management will
impose absolute limits on the level of volatility risk to which Finance's
swap portfolio may be exposed.
22. In any transaction in which Finance arranges a swap transaction
between an affiliate and a third party, the third party will be informed
that Finance is acting on behalf of an affiliate.
137
Financial Factors, Managerial Resources and Other
Considerations
In order to approve this application, the Board is
required to determine that the performance of the
proposed activities by Applicant "can reasonably be
expected to produce benefits to the public . . . that
outweigh possible adverse effects, such as undue
concentration of resources, decreased or unfair competition, conflicts of interests, or unsound banking
practices." 12 U.S.C. § 1843(c)(8).
The Board has reviewed the capitalization of both
Applicant and Company in accordance with the standards set forth in the Canadian Imperial, et al. order, 23
and finds the capitalization of each to be consistent
with approval of the proposal. In this regard, the
Board notes that Applicant's capital ratios, both before and after deduction of investments in and unsecured loans to Company, are well above the minimum
levels established in the risk-based capital guidelines
adopted by the Basle Committee on Banking Regulation and Supervisory Practices, and that Applicant
may be considered strongly capitalized. 24 Applicant is
in good standing with its home country supervisor and
the U.S. offices and subsidiaries of Applicant are in
generally satisfactory condition.
With respect to the capitalization of Company,
approval of the requested activities is limited to a level
consistent with the projections of position size and
types of securities contained in the application. The
Board has also determined that all other financial and
managerial factors are consistent with the ability of
Applicant to remain a source of strength to its U.S.
banking operations.
To approve the application, the Board must find that
Applicant's performance of the activities would result
in public benefits that outweigh potential adverse
effects. In making this evaluation, the Board considered that Applicant, through Deutsche Bank Capital
Corporation, New York, New York ("DBCC"), engages in securities activities in the United States that
are not permissible for U.S. bank holding compa-
23. 76 Federal Reserve Bulletin at 161 (1990).
24. Consistent with the guidelines adopted in connection with the
Report on Capital Equivalency, issued June 19, 1992, Applicant's
capital was evaluated under the risk-based capital guidelines as
administered by Applicant's home country, a signatory to the Basle
Capital Accord. The Basle standard provides a common basis for
evaluating the general equivalency of capital among banks from
various countries. As noted in the Study, however, simply meeting the
minimum capital standards does not automatically imply that the
financial condition of a foreign bank applicant is consistent with
approval of a particular application. The capital ratio necessary to
obtain approval for full underwriting and dealing authority will be
higher than the ratio required to conduct a low-risk activity. As noted,
in this case, Applicant's ratios are well above the Basle minimum
standards and are equivalent to those required of domestic applicants.
138
Federal Reserve Bulletin • February 1993
nies. 25 As a result, Applicant could conceivably gain
an unfair competitive advantage over domestic bank
holding companies by combining grandfathered securities and other activities with activities permissible
under section 4(c)(8) of the BHC Act. This could occur
if the grandfathered activities were used to support or
enhance the section 4(c)(8) activities, or the 4(c)(8)
activities were used to support or enhance the grandfathered activities, thus allowing Applicant to offer a
wider array of services than is permissible for domestic bank holding companies. Moreover, the combination of the companies' underwriting, dealing, placement, and advisory activities could give rise to
conflicts of interest.
Applicant has, however, committed that DBCC26
and the Companies will remain completely separate
and will not engage in any business with, or on behalf
of, each other. Included within this commitment are a
series of individual commitments, set forth as Appendix A to this order, designed to further the complete
separation of DBCC from the U.S. operations of
Morgan Grenfell. 27 These commitments are consistent
with representations made in connection with prior
Board decisions concerning the approval of section
4(c)(8) applications where the applicant also engaged
in grandfathered activities under the IBA. 28 The commitments have been modified and expanded to reflect
the nature of the activities of the U.S. operations of
Morgan Grenfell. In light of these commitments, as
25. DBCC is a registered broker-dealer that engages in underwriting
and dealing in all types of securities and in various other financial
activities. Applicant has owned DBCC and has indirectly engaged in
such activities since prior to July 26, 1978. Section 8(c)(1) of the
International Banking Act of 1978 ("IBA") provides that any foreign
bank that became subject to the IBA on its enactment may continue to
engage in the United States in any activities in which it or an affiliate
was engaged on July 26,1978. 12 U.S.C. § 3106(c)(1). Thus, Applicant
is grandfathered under section 8(c)(1) of the IBA to retain its interest
in DBCC and to continue to engage in securities activities, unless the
Board, after notice and opportunity for a hearing, finds that the
continuation of the activities would give rise to adverse effects, such
as undue concentration of resources, decreased or unfair competition,
conflicts of interest, or unsound banking practices in the United
States.
26. For purposes of these commitments, "DBCC" refers to DBCC
and any of its subsidiaries or affiliates operating in the United States
under section 8(c)(1) of the IBA.
27. Applicant has proposed that a management official of its New
York branch who is also a director of Company (as permitted pursuant
to condition 13 of the Canadian Imperial, et al. order) also serve as a
director of Deutsche Bank North American Holding Corp., the parent
company of DBCC. The purpose of such interlock is to provide
supervision and oversight in connection with Applicant's U.S. operations. The official would have no day-to-day responsibilities for the
operations of DBCC or Company. The Board believes that such
oversight is prudent and has determined that the proposal would not
result in any adverse effects in light of the framework of conditions
applicable to Company as a section 20 company and the further
commitments made by Applicant to maintain the separation of all
business of DBCC and Company.
28. Dresdner Bank AG, 75 Federal Reserve Bulletin 642 (1989);
Bayerische Vereinsbank AG, 73 Federal Reserve Bulletin 155 (1987).
well as the prudential framework governing Company
as a section 20 subsidiary and the applicable legal
restrictions under federal securities registration laws,
the Board believes that Applicant would not gain an
unfair competitive advantage in conducting the grandfathered activities, and that those activities would not
give rise to conflicts of interest in connection with
activities approved under section 4(c)(8) of the BHC
Act.
The Board received a comment from Mr. Steven
Mizel ("Protestant") alleging that Applicant's retention of the subsidiaries of Morgan Grenfell pic would
not reasonably be expected to produce benefits to the
public. Protestant bases his assertion on claims that
Applicant and Morgan Grenfell breached their fiduciary duties and tortiously interfered with Protestant's
business. Protestant alleges that he had entered into an
agreement with Company whereby they would offer
financial advisory services to third parties. Protestant
asserts that Applicant and its subsidiaries breached the
contract, breached fiduciary duties, made fraudulent
statements or were negligent in making statements,
maliciously and wrongfully interfered with present and
prospective business relations, and that Applicant
aided and abetted the breach of fiduciary duties. There
is a continuing lawsuit between Applicant and its
subsidiaries and Protestant contesting the claims.
Protestant has raised issues that the Board is not
permitted to consider under section 4(c)(8) of the BHC
Act. The Board does not adjudicate private contractual claims between parties, and Protestant's assertions will be considered in a court of law. Thus,
Protestant has not raised any issue which would require denial of the application. 29
Protestant also alleges that the Board should not
approve the application because competition in the
finance industry would be diminished. While the acquisition does decrease the competition in the industry, there will continue to be a large number of
competitors in the industry. Accordingly, the Board
has determined that this comment does not require
denial of the application.
Protestant also alleges that the application is incomplete because it does not reflect an agreement to
provide financial advisory services with Eric
Gleacher. The Board notes, however, that Applicant
has submitted a separate and independent application
to perform financial advisory services in cooperation
with Eric Gleacher & Co. Protestant further asserts
29. Protestant maintains that Company did not make disclosures
required by the Board at the time Company was dealing with Protestant. At the time of the transactions, Company was not operating
pursuant to section 4(c)(8) of the BHC Act, and thus not required to
make the disclosures.
Legal Developments
that the Applicant has not been candid in its representations concerning its control over Morgan Grenfell
and its subsidiaries, has requested that the Board
extend the time for comment and conduct a full
hearing into the facts, and require Applicant to amend
the application.30 The Board believes that, because
Applicant lawfully owns and controls the stock of
Morgan Grenfell, having acquired such ownership
pursuant to authorization from the Board, Applicant
has the right to exercise control over its policies and
procedures, provided that the control does not violate
the law or commitments relied upon by the Board in
permitting the acquisition.
Under the framework established in this and prior
decisions, approval of this proposal is not likely to
result in any significant adverse effects, such as undue
concentration of resources, decreased or unfair competition, conflicts of interest, or unsound banking
practices. Approval of the proposal would allow Applicant to continue to provide greater efficiencies and
convenience to its customers by permitting the continuation of the provision of a wider range of services by
a single entity. Based on the foregoing and other facts
of record, and subject to the commitments made by
Applicant, the Board has determined that the performance of the proposed activities by Applicant can
reasonably be expected to produce public benefits that
would outweigh possible adverse effects under the
proper incident to banking standard of section 4(c)(8)
of the BHC Act. 3 i
Accordingly, and for the reasons set forth in the
section 20 orders and in Canadian Imperial, et al., the
Board concludes that Applicant's proposal to engage
30. Protestant has requested that the Board hold a public hearing to
assess further facts surrounding the application, and Applicant's
conduct. Generally under the Board's rules, the Board may, in its
discretion, hold a public hearing or meeting on an application to clarify
factual issues related to the application and to provide an opportunity
for testimony, if appropriate. 12 C.F.R. 262.3(e) and 262.25(d).
The Board has carefully considered this request. In the Board's
view, the parties have had ample opportunity to present submissions,
and Protestant has submitted substantial written comments, some
received after the close of the comment period, that have been
considered by the Board. In light of these facts, the Board has
determined that a public meeting or hearing is not either necessary to
clarify the factual record in these applications, or otherwise warranted
in this case. Accordingly, the request for a public meeting or hearing
on this application and the request to extend formally the time for
public comment are hereby denied.
31. Company may also purchase and sell for its own account
futures, forwards, options, and options on futures contracts on
ineligible securities, as incidents to the proposed ineligible securities
underwriting and dealing activities. Any activity conducted as a
necessary incident to the ineligible securities underwriting and dealing
activities must be treated as part of the ineligible securities activity
unless Company has received specific approval under section 4(c)(8)
of the BHC Act to conduct the activity independently. Until such
approval is obtained, any revenues from the incidental activity must
be counted as ineligible revenue subject to the 10 percent gross
revenue limitation set forth in the Modification Order.
139
through Company in the requested activities is consistent with the Glass-Steagall Act and is so closely
related to banking as to be a proper incident thereto
within the meaning of section 4(c)(8) of the BHC Act,
provided Applicant limits Company's activities as
provided in the section 20 orders and in Canadian
Imperial, et al.
The application is hereby approved, subject to all
the terms and conditions of those orders and this
order. The Board's approval of this proposal extends
only to activities conducted within the conditions of
those orders and this order, including the Board's
reservation of authority to establish additional limitations to ensure that Company's activities are consistent with safety and soundness, conflict of interest,
and other relevant considerations under the BHC Act.
Underwriting and dealing in any manner other than as
approved in those orders is not within the scope of the
Board's approval and is not authorized for Company.
Company has established policies and procedures to
ensure compliance with the requirements of this order,
including computer, audit and accounting systems,
internal risk management controls and the necessary
operational and managerial infrastructure to comply
with the requirements of this order. Accordingly,
Company may engage in the requested debt and equity
underwriting and dealing activities.
The Board's determination is subject to all of the
conditions set forth in the Board's Regulation Y,
including those in sections 225.4(d) and 225.23(b), and
to the Board's authority to require modification or
termination of the activities of a bank holding company or any of its subsidiaries as the Board finds
necessary to assure compliance with, and to prevent
evasion of, the provisions of the BHC Act and the
Board's regulations and orders issued thereunder.
By order of the Board of Governors, effective
December 17, 1992.
Voting for this action: Chairman Greenspan and Governors
Mullins, Angell, Kelley, LaWare, Lindsey, and Phillips.
JENNIFER J . JOHNSON
Associate Secretary of the Board
Appendix A
List of Commitments Separating the Operations of
DBCC and CJL Deutsche Bank commits that DBCC 1
1. For purpose of these commitments, "DBCC" is deemed to mean
Deutsche Bank Capital Corporation and each of its subsidiaries and
affiliates operating pursuant to section 8(c) of the International Banking Act of 1978, as amended.
140
Federal Reserve Bulletin • February 1993
and the Company2 will remain completely separate
and will not engage in any business with, or on behalf
of, each other. In addition and without limiting the
foregoing commitment, Deutsche Bank has made the
following specific commitments:
(1) No director, officer or employee of DBCC will
serve as an officer, director or employee of the
Company, except that Deutsche Bank, for administrative and supervisory purposes, may authorize
one person to serve as a director of CJL and the
parent company of DBCC if the person is not
involved in the day-to-day operations of the companies.
(2) DBCC will not enter into any joint marketing
efforts with the Company and will not solicit customers for the Company in the United States, nor
will the Company solicit customers for DBCC in the
United States.
(3) The Company will not share fees, profits or
customer information with, will not make customer
referrals to, and will not engage in cross marketing
with, DBCC, nor will the Company and DBCC
share customer lists or nonpublic customer information. 3
(4) The Company will not provide investment advice
on any securities issued by DBCC.
(5) The Company will not provide investment advice
to a customer with respect to securities being underwritten or privately placed by DBCC or in which
DBCC makes a market, unless the Company:
(i) Has conducted an independent analysis of such
securities in the same manner and to the same
extent as if the securities were not underwritten,
placed, or dealt in by DBCC;
(ii) Discloses the fact of the affiliation to its
customer and the involvement of the affiliate with
the securities, and;
(iii) Obtains the customer's prior consent to the
purchase or sale of such securities, provided that
in those cases where obtaining such prior consent
is impractical (e.g., if the customer is located
outside the United States), the Company will
obtain such consent as soon as practicable after
the purchase or sale.
Further, DBCC will follow the above procedures
with respect to securities which are being underwritten or privately placed by Company, or in which
Company makes a market.
2. For purposes of these commitments, "Company" is deemed to
mean each of the U.S. subsidiaries of Morgan Grenfell.
3. DBCC and Company may exchange confidential customer information upon the specific request of a client, provided that the
customer is informed, either orally or in writing, that Company and
DBCC may not engage in any joint undertakings on behalf of the
client.
(6) The Company will not engage in promotional
activities with respect to any distribution of securities being underwritten by DBCC. DBCC will not
engage in promotional activities with respect to any
distribution of securities being underwritten by
Company.
(7) DBCC will not distribute, within the United
States, shares of any investment company advised
by the Company.
(8) DBCC will not sell or purchase securities or
assets, either as a principal or a broker, to, from, or
for any investment company advised by the Company, or otherwise perform for such an investment
company any service that DBCC might have authority to provide under the IB A.
(9) No employee of DBCC will serve as a portfolio
manager of any investment company advised by the
Company.
(10) No officer, director or employee of DBCC will
serve as a director of any open-end investment
company advised by the Company.
(11) DBCC will not acquire, either for its own
account or as a fiduciary, any shares of any investment company advised by the Company.
(12) Company, and its employees, officers, and
directors, will abide by the commitments enumerated in numbers 7, 8, 9, 10, and 11, with respect to
investment companies advised by DBCC.
(13) The Company will disclose its relationship with
DBCC and Applicant's subsidiaries and affiliates to
each of the Company's customers to the full extent
required by the U.S. securities laws.
(14) The Company will have no arrangement with
any person involved in distributing securities with
regard to the Company's advice to its customers
concerning such securities except, and only in the
case of persons other than DBCC, to the extent such
arrangements are permissible under U.S. securities
laws and other applicable laws.
(15) The Company will disclose to its customers
with discretionary accounts that its affiliates may
make a market in securities that it will purchase and
sell for those customers, account and will obtain a
written consent from such customers to the purchase or sale of securities from time to time by it for
the portfolios of such customers to the extent required by the U.S. securities laws and other applicable laws such as ERISA.
(16) Company will not participate in an underwriting
or placement of securities if DBCC is participating
in the underwriting or placement of the issuer's
securities.
(17) Company will not act as a market-maker, specialist, or perform similar activities with respect to
securities which are being underwritten or dealt in
Legal Developments
by DBCC, and vice versa. Thus, Company will not
underwrite the issuance of securities if DBCC is
making a market in the securities, and vice versa. In
addition, Company should not make a market in a
security for which DBCC served as a market-maker
within the preceding twelve months, and vice versa.
(18) Company will not offer any services relating to
interest rate and currency swaps and derivative
products if DBCC is a counterparty or agent, and
vice versa. Company will not enter into swaps or
derivative products with DBCC, nor would either
company utilize the services of the other when
providing services to third parties.
(19) Company will not provide any financial advisory services to a customer if DBCC is also advising
the customer or a third party on the same or related
manner.
(20) There will be no joint undertakings between
DBCC and Company.
Huntington Bancshares Incorporated
Columbus, Ohio
Order Approving Application to Engage De novo in
Underwriting and Dealing in Certain Bank-Ineligible
Securities on a Limited Basis, and Other
Securities-Related Activities
Huntington Bancshares Incorporated, Columbus,
Ohio ("Applicant"), a bank holding company within
the meaning of the Bank Holding Company Act
("BHC Act"), has applied pursuant to section 4(c)(8)
of the BHC Act (12 U.S.C. § 1843(c)(8)) and section
225.23(a)(3) of the Board's Regulation Y (12 C.F.R.
225.23(a)(3)), for approval to engage de novo through
its wholly owned subsidiary, The Huntington Company, Columbus, Ohio ("Company"), in the following
activities:
(1) Underwriting and dealing in municipal revenue
bonds (including public ownership industrial development bonds), mortgage-related securities, consumer-receivable-related securities, and commercial
paper (hereinafter "bank- ineligible securities");
(2) Acting as agent in the private placement of all
types of securities, including providing related advisory services;
(3) Buying and selling securities on the order of
investors as a "riskless principal";
(4) Providing securities brokerage services to institutional and retail customers, both separately and in
combination with investment advisory services pursuant to section 225.25(b)(15) of the Board's Regulation Y (12 C.F.R. 225.25(b)(15)) (hereinafter "fullservice brokerage");
141
(5) Providing investment advisory and financial advisory services pursuant to section 225.25(b)(4) of
the Board's Regulation Y (12 C.F.R. 225.25(b)(4));
and
(6) Underwriting and dealing in government obligations and money market instruments pursuant to
section 225.25(b)(16) of the Board's Regulation Y
(12 C.F.R. 225.25(b)(16)) (hereinafter "bank-eligible
securities").
Notice of the application, affording interested persons an opportunity to submit comments, has been
published (57 Federal Register 57,233 (1992)). The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the public interest factors set forth in
section 4(c)(8) of the BHC Act.
Applicant, with total consolidated assets of $13.5 billion, is the fourth largest commercial banking organization in Ohio.1 It operates eight banking subsidiaries in
Ohio, Michigan, Indiana, Kentucky, and West Virginia,
and engages in various nonbanking activities through
eight nonbanking subsidiaries.
The Board has previously determined by regulation
that providing investment advisory and financial advisory services, full service brokerage services, and
underwriting and dealing in government obligations
and money market instruments are activities that are
closely related to banking for purposes of section
4(c)(8) of the BHC Act. 2 Applicant proposes to conduct these activities through Company in accordance
with the Board's regulations. 3
Underwriting and Dealing in Bank-Ineligible
Securities
The Board has determined that, subject to the prudential framework of limitations established in previous
decisions to address the potential for conflicts of
interests, unsound banking practices, or other adverse
effects, the proposed underwriting and dealing activities are so closely related to banking as to be proper
1. Data are as of September 30, 1992.
2. See 12 C.F.R. 225.25(b)(4), (b)(15), and (b)(16).
3. When providing full-service brokerage with respect to bankineligible securities that it holds as principal, Company will provide
customers with disclosure statements as previously approved by the
Board. See PNC Financial Corporation, 75 Federal Reserve Bulletin
396, 397 (1989). Specifically, Company will inform its customers at the
commencement of the relationship that, as a general matter, Company
may be a principal or may be engaged in underwriting with respect to,
or may purchase from an affiliate, those securities for which brokerage
and advisory services are provided. At the time any brokerage order
is taken, the customer will be informed (usually orally) whether
Company is acting as agent or principal with respect to a security.
Confirmations sent to customers also will state whether Company is
acting as agent or principal.
142
Federal Reserve Bulletin • February 1993
incidents thereto within the meaning of section 4(c)(8)
of the BHC Act. The Board also has determined that
the conduct of these securities underwriting and dealing activities is consistent with section 20 of the
Glass-Steagall Act, provided that the underwriting
and dealing subsidiary derives no more than 10 percent
of its total gross revenue from underwriting and dealing in bank-ineligible securities over any two-year
period. 4 Applicant has committed that Company will
conduct its underwriting and dealing activities with
respect to bank-ineligible securities subject to the 10
percent revenue test established by the Board in
previous Orders. 5
Private Placement and "Riskless
Activities
Principal"
Private placement involves the placement of new
securities with a limited number of sophisticated purchasers in a nonpublic offering. A financial intermediary in a private placement transaction acts solely as an
agent of the issuer in soliciting purchasers, and does
not purchase the securities and attempt to resell them.
Securities that are privately placed are not subject to
the registration requirements of the Securities Act of
1933, and are offered only to financially sophisticated
institutions and individuals and not the public. Applicant will not privately place registered securities and
will only place securities with customers who qualify
as accredited investors.
"Riskless principal" is the term used in the securities business to refer to a transaction in which a
broker-dealer, after receiving an order to buy (or sell)
a security from a customer, purchases (or sells) the
security for its own account to offset a contemporaneous sale to (or purchase from) the customer. 6 "Risk-
4. See Citicorp, J.P. Morgan & Company Incorporated, and
Bankers Trust New York Corporation, 73 Federal Reserve Bulletin 473
(1987) ("Citicorp/Morgan/Bankers Trust Order"), affd sub nom.
Securities Industry Association v. Board of Governors of the Federal
Reserve System, 839 F.2d 47 (2d Cir. 1988), cert, denied, 486 U.S.
1059 (1988), as modified by Order Approving Modifications to Section
20 Orders, 75 Federal Reserve Bulletin 751 (1989) ("Modification
Order"). The 10 percent revenue limitation should be calculated in
accordance with the method stated in J.P. Morgan & Company
Incorporated, The Chase Manhattan Corporation, Bankers Trust
New York Corporation, Citicorp, and Security Pacific Corporation, 75
Federal Reserve Bulletin 192, 196 (1989).
5. Company may also provide services that are necessary incidents
to these approved activities. Any activity conducted as a necessary
incident to the bank-ineligible securities activity must be treated as
part of the bank-ineligible securities activity unless Company has
received specific approval under section 4(c)(8) of the BHC Act to
conduct the activity independently. Until such approval is obtained,
any revenues from the incidental activity must be counted as ineligible
revenue subject to the 10 percent gross revenue limit set forth in the
CiticorplMorganlBankers Trust Order and the Modification Order.
6. See Securities and Exchange Commission Rule 10b-10, 17 C.F.R.
240.10b-10(a)(8)(i).
less principal" transactions are understood in the
industry to include only transactions in the secondary
market. Thus, Applicant proposes that Company
would not act as a "riskless principal" in selling
securities at the order of a customer that is the issuer
of the securities to be sold or in any transaction where
Company has a contractual agreement to place the
securities as agent of the issuer. Company also would
not act as a "riskless principal" in any transaction
involving a security for which it makes a market.
The Board previously has determined by Order that,
subject to certain prudential limitations that address
the potential for conflicts of interests, unsound banking practices, or other adverse effects, the proposed
private placement and riskless principal activities are
so closely related to banking as to be a proper incident
thereto within the meaning of section 4(c)(8) of the
BHC Act. 7 The Board also has previously determined
that acting as agent in the private placement of securities, and purchasing and selling securities on the
order of investors as a "riskless principal" do not
constitute underwriting and dealing in securities for
purposes of section 20 of the Glass-Steagall Act, and
that revenue derived from these activities is not subject to the 10 percent revenue limitation on bankineligible securities underwriting and dealing.8 Applicant has committed that Company will conduct its
private placement and "riskless principal" activities
using the same methods and procedures, and subject
to the same prudential limitations established by the
Board in the Bankers Trust II Order and the J.P.
Morgan II Order, 9 including the comprehensive
7. See Bankers Trust New York Corporation, 75 Federal Reserve
Bulletin 829 (1989) ("Bankers Trust II Order"). Applicant has also
proposed, consistent with J.P. Morgan <fe Company Incorporated, 76
Federal Reserve Bulletin 26 (1990) {"J.P. Morgan II Order"), and
subject to the limitations contained in that Order, that:
(1) Applicant's nonbank subsidiaries be permitted to purchase
securities privately placed by Company, and
(2) Applicant and its subsidiaries other than Company be permitted
to lend to an issuer for the purpose of repaying securities placed by
Company.
8. See Bankers Trust II Order.
9. See J.P. Morgan II Order, 76 Federal Reserve Bulletin at 26;
Bankers Trust II Order, 75 Federal Reserve Bulletin at 829. Among the
prudential limitations detailed more fully in those Orders are that
Company will maintain specific records that will clearly identify all
"riskless principal" transactions, and Company will not engage in any
"riskless principal" transactions for any securities carried in its
inventory. When acting as a "riskless principal," Company will only
engage in transactions in the secondary market, and not at the order of
a customer that is the issuer of the securities to be sold, will not act as
"riskless principal" in any transaction involving a security for which
it makes a market, nor hold itself out as making a market in the
securities that it buys and sells as a "riskless principal." Moreover,
Company will not engage in "riskless principal" transactions on
behalf of its foreign affiliates that engage in securities dealing activities
outside the United States and will not act as "riskless principal" for
registered investment company securities. In addition, Company will
not act as a "riskless principal" with respect to any securities of
investment companies that are advised by Applicant or any of its
Legal Developments
framework of restrictions designed to avoid potential
conflicts of interest, unsound banking practices, and
other adverse effects imposed by the Board in connection with underwriting and dealing in securities.
Financial Factors, Managerial Resources, and Other
Considerations
In every case involving a nonbanking acquisition by a
bank holding company under section 4 of the BHC
Act, the Board considers the financial condition and
resources of the applicant and its subsidiaries and the
effect of the transaction on these resources. 10 Based
on the facts of this case, the Board concludes that
financial considerations are consistent with approval
of this application. The managerial resources of Applicant also are consistent with approval.
In order to approve this application, the Board is
required to determine that the performance of the
proposed activities by Applicant can reasonably be
expected to produce public benefits that would outweigh adverse effects under the proper incident to
banking standard of section 4(c)(8) of the BHC Act.
Under the framework established in this Order and
prior decisions, consummation of this proposal is not
likely to result in any significant adverse effects, such
as undue concentration of resources, decreased or
unfair competition, conflicts of interests, or unsound
banking practices. Consummation of the proposal
would provide added convenience to Company's customers. In addition, the Board expects that the de
novo entry of Company into the market for these
services would increase the level of competition
among providers of these services. Accordingly, the
Board has determined that the performance of the
proposed activities by Applicant can reasonably be
expected to produce public benefits that would outweigh possible adverse effects under the proper incident to banking standard of section 4(c)(8) of the BHC
Act.
Based on all the facts of record, and subject to the
commitments made by Applicant, as well as all of the
terms and conditions set forth in this Order and in the
above-noted Board Orders, the Board has determined
that the application should be, and hereby is, approved. Approval of this proposal is specifically conditioned on compliance by Applicant and Company
with the commitments made in connection with its
affiliates. With regard to private placement activities, Company will
not privately place registered investment company securities. Further, Company will not privately place any securities of investment
companies that are advised by Applicant or any of its affiliates.
10. See 12 C.F.R. 225.25. See also The Fuji Bank, Limited, 75
Federal Reserve Bulletin 94 (1989); Bayerische Vereinsbank AG, 73
Federal Reserve Bulletin 155, 156 (1987).
143
application, as supplemented, and with the conditions
referenced in this Order. The Board's determination
also is subject to all of the conditions set forth in
Regulation Y, including those in sections 225.4(d) and
225.23(b), and to the Board's authority to require
modification or termination of the activities of a bank
holding company or any of its subsidiaries as the
Board finds necessary to assure compliance with, and
to prevent evasion of, the provisions of the BHC Act
and the Board's regulations and Orders issued thereunder. In approving this transaction, the Board has
relied upon all of the facts of record and all of the
representations and commitments made by Applicant.
The Board's action is expressly conditioned upon
compliance with all of the commitments made by
Applicant. For the purpose of this action, these commitments will be considered conditions imposed in
writing and, as such, may be enforced in proceedings
under applicable law.
This transaction shall not be consummated later
than three months after the effective date of this
Order, unless such period is extended for good cause
by the Board or by the Federal Reserve Bank of
Cleveland pursuant to delegated authority.
By order of the Board of Governors, effective
December 21, 1992.
Voting for this action: Chairman Greenspan and Governors
Mullins, Angell, Kelley, LaWare, Lindsey, and Phillips.
JENNIFER J . JOHNSON
Associate Secretary of the Board
ORDERS ISSUED
BANKING
ACT
UNDER
INTERNATIONAL
TaipeiBank
Taipei City, Taiwan
Order Approving Establishment of a Branch
TaipeiBank, Taipei, Taiwan ("Bank"), a foreign bank
within the meaning of the International Banking Act
("IB A"), has applied under section 7(d) of the IB A
(12 U.S.C. § 3105(d)) to establish a state-licensed
branch in Los Angeles, California. A foreign bank
must obtain the approval of the Board to establish a
branch, agency, commercial lending company, or representative office in the United States under the Foreign Bank Supervision Enhancement Act of 1991
("FBSEA"), which amended the IBA.
Notice of the application, affording interested persons an opportunity to submit comments, has been
published in a newspaper of general circulation in
144
Federal Reserve Bulletin • February 1993
Los Angeles, California (Los Angeles Daily Journal,
May 11, 1992). The time for filing comments has
expired and no public comments were received.
Bank was established in 1969 as a commercial bank
owned by the Taipei Municipal Government ("Municipal Government"). 1 Bank is the eighth largest bank in
Taiwan in terms of total assets, which at year end 1991
were $19.6 billion. Bank owns 30 percent of the shares
of one Taiwanese subsidiary which concentrates its
activities in Taiwan, and has one office outside of
Taiwan, a state-licensed agency in New York, New
York. Bank does not engage, directly or indirectly, in
any nonbanking activities in the United States. Bank
will remain a qualifying foreign banking organization
under Regulation K after establishing the proposed
branch (12 C.F.R. 211.24(a)).
Under the IB A, in order to approve an application
by a foreign bank to establish a branch in the United
States, the Board must determine that the foreign
bank:
(1) Engages directly in the business of banking
outside of the United States;
(2) Has furnished to the Board the information it
needs to assess adequately the application; and
(3) Is subject to comprehensive supervision or regulation on a consolidated basis by its home country
supervisor (12 U.S.C. § 3105(d)(2)).
The Board may also take into account additional
standards as set forth in the IBA (12 U.S.C. §
3105(d)(3)-(4)) and Regulation K (12 C.F.R. 211.25(c)).
Bank engages directly in the business of banking
outside of the United States through its extensive
commercial banking operations in Taiwan. Bank also
has provided the Board with the information necessary
to assess the application through submissions that
address the relevant issues.
Bank is supervised and regulated by both the Ministry of Finance of Taiwan ("Ministry") and the Central Bank of China ("Central Bank"), which share
responsibility for the supervision of Taiwanese banks.
The Banking Law of Taiwan authorizes the Ministry to
regulate and supervise commercial banks in Taiwan,
including Bank. 2 The Ministry has delegated the authority to the Central Bank to act as the primary
examiner of banks in Taiwan, in which capacity the
Central Bank conducts mandatory annual examinations. 3
1. The Municipal Government owns 99.9 percent of Bank's shares.
2. With respect to banks, this authority permits the Ministry to,
among other things, issue licenses, limit activities and expansion,
conduct examinations, set minimum capital and liquidity ratios, limit
credit extensions, restrict director interlocks, define qualifications for
management, and take enforcement actions.
3. Bank receives additional oversight by its owner, the Municipal
Government, and the Ministry of Audit of the Control Yuan, an
Regulation K provides that a foreign bank will be
considered to be subject to comprehensive supervision
or regulation on a consolidated basis if the Board
determines that the bank is supervised and regulated in
such a manner that its home country supervisor receives sufficient information on the worldwide operations of Bank, including the relationship of Bank to
any affiliate, to assess the overall financial condition of
Bank and its compliance with law and regulation
(12 C.F.R. 211.25(c)(1)).4 In making its determination
under this standard on this application by Bank, the
Board considered the following information.
The Ministry and the Central Bank obtain information on the condition of Bank, its subsidiary, and its
foreign office through regular examinations and periodic financial reports. The Central Bank performs
mandatory annual on-site head office examinations,
periodic office examinations, and, if warranted, targeted examinations of Bank. The Ministry coordinates
examinations and takes corrective measures based on
the examination reports. The annual examination of
the head office of Bank specifically includes a review
of both the international department and the foreign
operations or offices of Bank. The review of the
activities of Bank's foreign office includes scrutiny of
host country examination reports, internal control and
audit reports, and annual outside audit reports. The
Ministry has also implemented annual on-site examinations of Bank's foreign office to supplement this
review.
The Ministry and Central Bank obtain information
on the dealings and relationship between Bank and its
subsidiary through reports to and examinations by the
Central Bank and through the requirement that the
Ministry approve investments in other companies. The
Banking Law of Taiwan also imposes a prohibition on
certain unsecured lending to companies in which a
bank holds certain investments. Finally, if the Minis-
auditor of government agencies. This oversight is secondary to
supervision by the Ministry and the Central Bank.
4. In assessing this standard, the Board considers, among other
factors, the extent to which the home country supervisors:
(i) Ensure that the bank has adequate procedures for monitoring
and controlling its activities worldwide;
(ii) Obtain information on the condition of the bank and its
subsidiaries and offices through regular examination reports,
audit reports, or otherwise;
(iii) Obtain information on the dealings with and relationship
between the bank and its affiliates, both foreign and domestic;
(iv) Receive from the bank financial reports that are consolidated
on a worldwide basis, or comparable information that permits
analysis of the bank's financial condition on a worldwide consolidated basis;
(v) Evaluate prudential standards, such as capital adequacy and
risk asset exposure, on a worldwide basis.
These are indicia of comprehensive, consolidated supervision. No
single factor is essential and other elements may inform the Board's
determination.
Legal Developments
try or Central Bank determines that the subsidiary
poses an undue risk to Bank or is engaging in unsafe or
improper activities, the Ministry may require Bank to
divest its interest in the subsidiary. Bank has no parent
or sister affiliates.
With respect to foreign offices, the Ministry must
approve the establishment of such offices by Bank.
The Ministry and the Central Bank have also required
Bank to establish procedures under which an foreign
office must obtain head office approval of certain
transactions, undergo an annual internal audit, and
document its transactions. The Central Bank evaluates
the adequacy of these procedures and the records of
approved transactions during the annual examination
of Bank's head office.
The Ministry also requires approval of any investment in a company, including Bank's minority shareholding in its subsidiary. The Ministry and the Central
Bank also review financial information on the subsidiary that is incorporated in Bank's financial reports.
Finally, the Ministry and Central Bank may review the
corporate records of the subsidiary.
The Ministry and the Central Bank evaluate prudential standards, such as capital adequacy and risk asset
exposure, for Bank on a worldwide basis. The government of Taiwan incorporated the risk-based capital
standards of the Basle Accord into its Banking Law in
1989, with variations that conform to local accounting
practices and that apply to government-controlled
banks. 5 The Ministry implemented these standards to
restrict all dividends and other distributions by any
Taiwanese bank that has a risk-weighted capital ratio
of less than 8 percent.
Based on all the facts of record, which include the
information described above, the Board concludes
that Bank is subject to comprehensive supervision and
regulation on a consolidated basis.
In considering this application, the Board has also
taken into account the additional standards set forth in
section 7 of the IBA (12 U.S.C. § 3105(d)(3)-(4)). As
noted above, Bank has received the consent of its
home country authorities to establish the proposed
branch. In addition, the Ministry may share information on Bank's operations with other supervisors,
including the Board.
As noted, under local regulation, Bank must comply
with the capital standards of the Basle Accord, as
implemented by Taiwan. Bank's capital exceeds the
5. The Ministry has issued regulations that implement these standards. Generally, these regulations fall within the parameters of the
Basle Accord, with the exception of one equity adjustment item that
applies only to government-owned banks. This factor is not significant
in this case, and Bank's capital can be considered equivalent to that
required of a U.S. banking institution.
145
minimum standards and is equivalent to capital that
would be required of a U.S. banking organization.
Managerial and other financial resources of Bank are
also considered consistent with approval. The proposed branch is Bank's second office in the United
States, and Bank appears to have the experience and
capacity to support this additional office. In addition,
Bank has established controls and procedures for its
U.S. offices to ensure compliance with U.S. law.
Under the IBA, the proposed state-licensed branch
may not engage in any type of activity that is not
permissible for a federally-licensed branch without the
Board's approval.
Finally, Bank has committed that it will make available to the Board such information on the operations
of Bank and any affiliate of Bank that the Board deems
necessary to determine and enforce compliance with
the IBA, the Bank Holding Company Act of 1956, as
amended, and other applicable Federal law, to the
extent permitted by law. The Board has reviewed
relevant provisions of Taiwanese law and has communicated with the appropriate government authorities
concerning access to information. Bank also has committed to cooperate with the Board to obtain any
approvals or consents that may be needed to gain
access to information that may be requested by the
Board. In light of these commitments and other facts
of record, and subject to the condition described
below, the Board concludes that Bank has provided
adequate assurances of access to any necessary information the Board may request.
On the basis of all of the facts of record, and subject
to the commitments made by Bank, as well as the
terms and conditions set forth in this order, the Board
has determined that Bank's application to establish a
branch should be, and hereby is, approved. The Board
may revoke such approval should any restrictions on
access to information on the operations or activities of
Bank and any of its affiliates subsequently interfere
with the Board's ability to determine the safety and
soundness of Bank's U.S. operations or the compliance by Bank or its affiliates with applicable Federal
banking statutes. Approval of this application is also
specifically conditioned on compliance by Bank with
the commitments made in connection with this application, and with the conditions contained in this order. 6 The commitments and conditions referred to
above are conditions imposed in writing by the Board
6. The Board's authority to approve the establishment of the
proposed branch parallels the continuing authority of the State of
California to license offices of a foreign bank. The Board's approval of
this application does not supplant the authority of the State of
California, and its agent, the California State Banking Department, to
license the proposed branch of Bank in accordance with any terms or
conditions that California State Banking Department may impose.
146
Federal Reserve Bulletin • February 1993
in connection with its decision, and may be enforced in
proceedings under 12 U.S.C. § 1818 or 12 U.S.C.
§ 1847 against Bank, its office and its affiliates.
By order of the Board of Governors, effective
December 18, 1992.
Voting for this action: Chairman Greenspan and Governors
Angell, Kelley, La Ware, Lindsey, and Phillips. Absent and
not voting: Governor Mullins.
JENNIFER J . JOHNSON
Associate Secretary of the Board
United World Chinese Commercial Bank
Taipei, Taiwan
Order Approving Establishment of an Agency
United World Chinese Commercial Bank, Taipei, Taiwan ("Bank"), a foreign bank within the meaning of
the International Banking Act ("IBA"), has applied
under section 7(d) of the IBA (12 U.S.C. § 3105(d)) to
establish a state-licensed agency in Los Angeles, California. A foreign bank must obtain the approval of the
Board to establish a branch, agency, commercial lending company, or representative office in the United
States under the Foreign Bank Supervision Enhancement Act of 1991 ("FBSEA"), which amended the
IBA.
Notice of the application, affording interested persons an opportunity to submit comments, has been
published in a newspaper of general circulation in Los
Angeles, California (Los Angeles Times, April 18,
1992). The time for filing comments has expired and no
public comments were received.
Bank is a privately owned commercial bank that was
established in 1975.1 Bank is the 11th largest bank in
Taiwan, with assets of approximately $10 billion as of
year end 1991. Upon establishment of the proposed
agency, Bank will be a qualifying foreign banking
organization under Regulation K (12 C.F.R.
211.24(a)). Bank owns three subsidiaries in Taiwan,
and currently has no offices outside of Taiwan. Bank
does not engage, directly or indirectly, in any banking
or nonbanking activities in the United States.
Under the IBA, in order to approve an application
by a foreign bank to establish an agency in the United
States, the Board must determine that the foreign
bank:
(1) Engages directly in the business of banking
outside of the United States;
1. No one shareholder owns more than 10 percent of the shares of
Bank, and each shareholder holds its interest in its separate capacity.
(2) Has furnished to the Board the information it
needs to assess adequately the application; and
(3) Is subject to comprehensive supervision or regulation on a consolidated basis by its home country
supervisor (12 U.S.C. § 3105(d)(2)).
The Board may also take into account additional
standards as set forth in the IBA (12 U.S.C.
§ 3105(d)(3)-(4)) and Regulation K (12 C.F.R.
211.25(c)).
Bank engages directly in the business of banking
outside of the United States through its extensive
commercial banking operations in Taiwan. Bank also
has provided the Board with the information necessary
to assess the application through submissions that
address the relevant issues.
Bank is supervised and regulated by both the Ministry of Finance of Taiwan ("Ministry") and the Central Bank of China ("Central Bank"), which share
responsibility for the supervision of Taiwanese banks.
The Banking Law of Taiwan authorizes the Ministry to
regulate and supervise banks in Taiwan, including
Bank. 2 The Ministry has delegated to the Central Bank
authority to act as the primary examiner of banks in
Taiwan, in which capacity the Central Bank conducts
mandatory annual examinations.
Regulation K provides that a foreign bank will be
considered to be subject to comprehensive supervision
or regulation on a consolidated basis if the Board
determines that the bank is supervised and regulated in
such a manner that its home country supervisor receives sufficient information on the worldwide operations of Bank, including the relationship of Bank to
any affiliate, to assess the overall financial condition of
Bank and its compliance with law and regulation
(12 C.F.R. 211.25(c)(1)).3 In making its determination
on this application, the Board considered the following
information.
2. With respect to banks, under this authority the Ministry issues
licenses, limits activities and expansion, conducts examinations, sets
minimum capital and liquidity ratios, limits credit extensions, restricts
director interlocks, defines qualifications for management, and takes
enforcement actions.
3. In assessing this standard, the Board considers, among other
factors, the extent to which the home country supervisors:
(i) Ensure that the bank has adequate procedures for monitoring
and controlling its activities worldwide;
(ii) Obtain information on the condition of the bank and its
subsidiaries and offices through regular examination reports,
audit reports, or otherwise;
(iii) Obtain information on the dealings with and relationship
between the bank and its affiliates, both foreign and domestic;
(iv) Receive from the bank financial reports that are consolidated
on a worldwide basis, or comparable information that permits
analysis of the bank's financial condition on a worldwide consolidated basis;
(v) Evaluate prudential standards, such as capital adequacy and
risk asset exposure, on a worldwide basis.
These are indicia of comprehensive, consolidated supervision. No
single factor is essential and other elements may inform the Board's
determination.
Legal Developments
The Ministry and the Central Bank obtain information on the condition of Bank and its subsidiaries and
foreign offices through regular examinations and periodic financial reports. The Central Bank performs
mandatory annual on-site head office examinations,
biannual office examinations, and, if warranted, targeted examinations of Taiwanese banks, including
Bank. The Ministry coordinates these examinations
and takes corrective measures based on the examination reports.
The annual examination of the head office of Bank
specifically includes a review of the international department and the foreign operations or offices of Bank.
The review of foreign office activities of Bank includes
scrutiny of host country examination reports, internal
control and audit reports, and annual outside audit
reports. The Ministry also is implementing annual
on-site examinations of foreign offices to supplement
this review.
The Ministry and Central Bank obtain information
on the dealings and relationship between Bank and its
subsidiaries through reports to and examinations by
the Central Bank and through the requirement that the
Ministry approve investments in other companies. The
Banking Law of Taiwan also imposes a prohibition on
certain unsecured lending to companies in which a
bank holds certain investments. In addition, if the
examination indicates that a subsidiary poses an undue
risk to Bank or is engaging in unsafe or improper
activities, the Ministry may compel divestiture of the
subsidiary. Bank has no parent or sister affiliates.
With respect to foreign offices, the Ministry must
approve the establishment of such offices by Bank.
The Ministry and the Central Bank have also required
Bank to establish procedures under which a foreign
office must obtain head office approval of certain
transactions and must undergo an annual internal
audit. The Central Bank evaluates the adequacy of
these procedures and the records of approved transactions during the annual examination of Bank's head
office.
With respect to subsidiaries of Bank, the Ministry
and the Central Bank ensure that Bank has adequate
oversight procedures through the annual head office
examination. Bank holds corporate records of its
subsidiaries, which include financial information, at its
head office. Examiners review these records during
the annual examination.
The Ministry and the Central Bank evaluate prudential standards, such as capital adequacy and risk asset
exposure, for Bank on a worldwide basis. The government of Taiwan incorporated the risk-based capital
standards of the Basle Accord into its Banking Law in
1989. The Ministry implemented these standards to
restrict all dividends and other distributions by any
147
Taiwanese bank that has a risk-weighted capital ratio
of less than 8 percent. Bank's accounting practices
require consolidation of its majority-owned subsidiaries, which is reflected in its risk-weight calculations.
Based on all the facts of record, the Board concludes that Bank is subject to comprehensive supervision and regulation on a consolidated basis.
In considering this application, the Board has also
taken into account the additional standards set forth in
section 7 of the IBA (12 U.S.C. 3105(d)(3)-(4)). As
noted above, Bank has received the consent of its
home country authorities to establish the proposed
agency. In addition, the Ministry may share information on Bank's operations with other supervisors,
including the Board.
As noted, under local regulation, Bank must comply
with the capital standards of the Basle Accord, as
implemented by Taiwan. Bank's capital exceeds the
minimum standards and is equivalent to capital that
would be required of a U.S. banking organization.
Managerial and other financial resources of Bank are
also considered consistent with approval. Although
the proposed agency would be Bank's first office
outside its home country, the purpose of the office is
generally to serve the international banking needs of
its customers, and Bank appears to have the experience and capacity to support this activity. Bank has
established controls and procedures for the proposed
agency to ensure compliance with U.S. law. Under the
IBA, the proposed state-licensed branch may not
engage in any type of activity that is not permissible
for a federally-licensed branch without the Board's
approval.
Finally, Bank has committed that it will make available to the Board such information on the operations
of Bank and any affiliate of Bank that the Board deems
necessary to determine and enforce compliance with
the IBA, the Bank Holding Company Act of 1956, as
amended, and other applicable Federal law, to the
extent permitted by law. The Board has reviewed
relevant provisions of Taiwanese law and has communicated with the appropriate government authorities
concerning access to information. Bank has committed to cooperate with the Board to obtain any approvals or consents that are needed to gain access to
information that may be requested by the Board. In
light these commitments and other facts of record, and
subject to the condition described below, the Board
concludes that Bank has provided adequate assurances of access to any necessary information the
Board may request.
On the basis of all of the facts of record, and subject
to the commitments made by Bank, as well as the
terms and conditions set forth in this order, the Board
has determined that Bank's application to establish an
148
Federal Reserve Bulletin • February 1993
agency should be, and hereby is, approved. The Board
may revoke such approval should any restrictions on
access to information on the operations or activities of
Bank and any of its affiliates subsequently interfere
with the Board's ability to determine the safety and
soundness of Bank's U.S. operations or the compliance by Bank or its affiliates with applicable federal
banking statutes. Approval of this application is specifically conditioned on compliance by Bank with the
commitments made in connection with this application, and with the conditions contained in this order. 4
The commitments and conditions referred to above are
conditions imposed in writing by the Board in connection with its decision, and may be enforced in proceedings under 12 U.S.C. § 1818 or 12 U.S.C. § 1847
against Bank, its office and its affiliates.
By order of the Board of Governors, effective
December 18, 1992.
Voting for this action: Chairman Greenspan and Governors
Angell, Kelley, LaWare, Lindsey, and Phillips. Absent and
not voting: Governor Mullins.
JENNIFER J . JOHNSON
Associate Secretary of the Board
ACTIONS
INSURANCE
TAKEN
UNDER
CORPORATION
THE FEDERAL
IMPROVEMENT
DEPOSIT
ACT
By the Board
December 22, 1992
John H. Huffstutler, Esq.
Assistant General Counsel
BankAmerica Corporation
Bank of America Center, Box 37,000
San Francisco, California 94137
BankAmerica has requested Board approval of this
transaction pursuant to section 5(d)(3) of the Federal
Deposit Insurance Act (12 U.S.C. § 1815(d)(3) ("FDI
Act")), as amended by the Federal Deposit Insurance
Corporation Improvement Act of 1991 (Pub. L. 102242, § 501, 105 Stat. 2236, 2388-2392 (1991)). Section
5(d)(3) of the FDI Act requires the Board to follow the
procedures and consider the factors set forth in the
Bank Merger Act (12 U.S.C. § 1828(c)). 12 U.S.C.
§ 1815(d)(3)(E).1
BankAmerica is the seventh largest commercial
banking organization in Texas, controlling deposits of
$4.2 billion, representing 2.9 percent of total deposits
in commercial banking organizations in the state. First
Gibraltar is the largest thrift organization in Texas,
controlling deposits of $6.2 billion, representing 16.6
percent of total deposits in thrift institutions in the
state. Upon consummation of the proposed transaction, BankAmerica would become the fourth largest
commercial banking or thrift organization (together,
"depository institutions") in Texas, controlling deposits of $10.6 billion, representing 6.9 percent of total
deposits in depository institutions in the state.
BankAmerica and First Gibraltar compete in the
Cooke, Corpus Christi, Dallas, Fort Worth, Houston,
Killeen-Temple MSA, San Antonio, Sherman-Denison
and Wichita banking markets, all in Texas. In the
Cooke banking market, 2 BankAmerica is the third
largest of ten depository institutions, controlling deposits of $55.3 million, representing approximately
12.9 percent of total deposits in depository institutions
in the market ("market deposits"). 3 First Gibraltar
controls deposits of $89.0 million. With thrift deposits
in the market weighted at 50 percent, 4 First Gibraltar
is the fifth largest depository institution in the market,
holding approximately 10.4 percent of market deposits. Upon consummation of this proposal, BankAmerica would control $144.3 million in deposits, representing approximately 30.5 percent of market deposits. 5
Dear Mr. Huffstutler:
BankAmerica Corporation, San Francisco, California,
("BankAmerica"), has proposed to purchase certain
assets and assume certain liabilities of First Gibraltar
Bank, FSB, Irving, Texas ("First Gibraltar"), through
BankAmerica's wholly owned bank subsidiary, Bank
of America Texas, N.A., Houston, Texas, ("Bank").
4. The Board's authority to approve the establishment of the
proposed agency parallels the continuing authority of the State of
California to license offices of a foreign bank. The Board's approval of
this application does not supplant the authority of the State of
California, and its agent, the California State Banking Department, to
license the proposed agency of Bank in accordance with any terms or
conditions that California State Banking Department may impose.
1. These factors include considerations relating to competition,
financial and managerial resources, and future prospects of the
existing and proposed institutions, and the convenience and needs of
the communities to be served. 12 U.S.C. § 1828(c).
2. The Cooke banking market is approximated by Cooke County
and the northern portion of Denton County, including the towns of
Aubrey, Pilot Point and Sanger, all in Texas.
3. Deposit data are as of June 30, 1991.
4. See, e.g., First Hawaiian, Inc., 11 Federal Reserve Bulletin 52,
55 (1991); First Union Corporation, 76 Federal Reserve Bulletin 83,85
(1990).
5. Because the deposits of First Gibraltar would be transferred to a
commercial bank under BankAmerica's proposal, those deposits are
included at 100 percent after Bank's assumption of these deposits. See
First Banks, Inc., 76 Federal Reserve Bulletin 669 , 670 n.9 (1990);
Norwest Corporation, 78 Federal Reserve Bulletin 452 (1992).
Legal Developments
The Herfindahl-Hirschman Index ("HHI") for this
market would increase by 432 points to 1947.6
Seven commercial banking organizations, including
two other than Bank with market shares of over 20
percent, and two thrift institutions would continue to
operate in the Cooke banking market following consummation of the proposal. In addition, Bank's branch
in the Cooke banking market has suffered a substantial
loss of deposits since Bank acquired the branch from
a troubled thrift institution. 7 The Cooke banking market also has a number of features that make it attractive to entry, 8 and Texas allows interstate banking and
intrastate branching, providing for a large number of
potential entrants into the market. In light of the
number and size of competitors remaining in the
Cooke banking market, the market's attractiveness to
entry, the number of potential entrants into the market, and other facts of record in this case, the Board
concludes that consummation of this proposal would
not have a significantly adverse effect on competition
or the concentration of banking resources in the Cooke
banking market. The Board also concludes that consummation of this proposal would not have a significantly adverse effect on competition in any of the
other relevant banking markets. 9
6. Under the revised Department of Justice Merger Guidelines, 49
Federal Register 26,823 (June 29, 1984), a market in which the
post-merger HHI is above 1800 is deemed to be highly concentrated.
In such markets, the Justice Department is likely to challenge a merger
that increases the HHI by more than 50 points. However, the Justice
Department has informed the Board that a bank merger or acquisition
generally will not be challenged (in the absence of other factors
indicating anticompetitive effects) unless the post-merger HHI is at
least 1800 and the merger increases the HHI by more than 200 points.
The Justice Department has stated that the higher-than-normal HHI
thresholds for screening bank mergers for anticompetitive effects
implicitly recognize the competitive effect of limited-purpose lenders
and other non-depository financial institutions.
7. As of August 31, 1992, Bank's deposits in the Cooke banking
market were $37.1 million, a decline of 18.7 percent since March 31,
1992.
8. Cooke County's population increased by 12.5 percent between
1980 and 1990 and is projected to grow 5.8 percent between 1990 and
1995. In addition, Denton County, the northern portion of which is in
the Cooke banking market, had a population increase of 98.1 percent
from 1980 to 1990 and is projected to grow 17.9 percent from 1990 to
1995.
9. In the Corpus Christi banking market, BankAmerica would
become the third largest depository institution, holding 12.5 percent of
market deposits, and the HHI would increase by 48 points to 954.
BankAmerica would become the third largest depository institution in
the Dallas banking market, holding 8.5 percent of market deposits,
and the HHI would increase by 2 points to 1123. In the Fort Worth
banking market, BankAmerica would become the second largest
depository institution, holding 12.8 percent of market deposits, and
the HHI would increase by 69 points to 774. BankAmerica would
become the sixth largest depository institution in the Houston banking
market, holding 6.3 percent of market deposits, and the HHI would
decrease by 6 points to 762. In the Killeen-Temple MSA banking
market, BankAmerica would become the tenth largest depository
institution, holding 4.4 percent of market deposits, and the HHI would
decrease by 11 points to 906. BankAmerica would become the third
largest depository institution in the San Antonio banking market,
149
The Board is also required under section 5(d)(3) of
the FDI Act to consider the effect of the proposal on
the convenience and needs of the communities to be
served. In considering the convenience and needs
factor, the Board has considered all comments submitted to the Board in connection with this application,
including comments submitted by the Association of
Community
Organizations
for Reform
Now
("ACORN"), Illinois chapter of ACORN, Michigan
chapter of ACORN, City of West Hollywood, Communities for Accountable Reinvestment, Rainbow
Bridge and California Reinvestment Committee (collectively, "Commenters"). Commenters generally allege that the proposed transaction is inconsistent with
a finding that BankAmerica is satisfactorily meeting
the convenience and needs of the communities it will
serve because:
(1) BankAmerica's lead bank, Bank of America
National Trust and Savings Association, San Francisco, California ("Bank of America"), controls
Bank's lending decisions, originates many of its
loans, and uses products that are not suited to lowand moderate-income communities outside of California;
(2) BankAmerica will not continue certain of First
Gibraltar's lending programs;
(3) BankAmerica has not abided by certain commitments that it made to community groups in connection with its recent application to acquire Security
Pacific Corporation, San Francisco, California ("Security Pacific"); 10 and
(4) BankAmerica discriminates11 on the basis of race
in its lending in Arizona and California, 12 and has
holding 11.1 percent of market deposits, and the HHI would increase
by 22 points to 1103. In the Sherman-Denison banking market,
BankAmerica would become the largest depository institution, holding 21.5 percent of market deposits, and the HHI would increase by
205 points to 1130. BankAmerica would become the fourth largest
depository institution in the Wichita banking market, holding
10.2 percent of market deposits, and the HHI would increase by 14
points to 1072.
10. See BankAmerica Corporation, 78 Federal Reserve Bulletin 338
(1992).
11. One Commenter stated that BankAmerica had an inadequate
record of hiring black executives. The Board believes that the
adequacy of a group's representation at a bank is generally beyond the
scope of factors that may be assessed by the Board under section
5(d)(3) of the FDI Act.
12. Commenters also allege that First Gibraltar discriminates on the
basis of race in its lending in Texas and that BankAmerica has failed
to provide data as required by the Home Mortgage Disclosure Act,
12 U.S.C. § 2801 ("HMDA"). BankAmerica has provided its 1991
HMDA data and other relevant data to ACORN and other community
groups in a form required by the Board's regulations, 12 C.F.R. Part
203. Bank was not required to submit HMDA data for 1991, the last
year for which HMDA data is available, because Bank was formed in
May, 1991 through the acquisition of deposit accounts of failed thrifts.
BankAmerica's HMDA data for 1991 is now publicly available.
150
Federal Reserve Bulletin • February 1993
contributed to disinvestment in low- and moderateincome communities in these states. 13
In assessing the impact of this proposal on the
convenience and needs of communities in Texas, the
Board has also considered the programs that BankAmerica has already put in place to serve community
needs in Texas, and the programs that BankAmerica
proposes to implement in Texas in connection with
this acquisition. In addition, the Board has taken into
account the past record of performance of the BankAmerica organization under the Community Reinvestment Act ("CRA") and its proposal to implement
CRA programs at Bank. The Board notes that BankAmerica began operating in Texas in 1991 through the
acquisition of the assets and liabilities of a failed bank
and two failed savings associations.
As a result of discussions with the Texas chapter of
ACORN and other community groups, Bank is offering, through Bank of America, a special version of its
Neighborhood Advantage Program called the Neighborhood Advantage Texas Homebuyer Program. 14 To
begin immediate implementation of the Neighborhood
Advantage Texas Homebuyer Program, BankAmerica
has funded this program through extensions of credit
by Bank of America using loan officers in Texas who
accept and review residential real estate applications
in Texas. These local loan officers review the applications under credit policies and procedures that take
into account the characteristics of the Texas market.
Credit review for loans in Texas includes a three-tier
process whereby any Neighborhood Advantage or
BASIC loan application that is declined by the line
underwriter is reviewed by the credit administrator at
the loan center. If the credit administrator also determines not to grant the loan, the loan is reviewed by the
real estate or consumer lending manager in Texas in
consultation with Bank's chief credit officer. BankAmerica intends to transfer funding and full responsi-
13. Commenters also state that the proposal is not in the public
interest because BankAmerica will be taking advantage of prior
federal subsidies that First Gibraltar has received. The Board notes
that the terms of the proposed purchase and assumption transaction
were negotiated on an arm's-length basis between two private parties
and that BankAmerica is not receiving any federal assistance in
connection with this proposal.
14. Under this program, special features are available to loan
applicants who complete a mandatory 6 to 8 hours of homebuyer
education, including expanded debt ratios; a waiver of the traditional
two-month reserve for principal, interest, taxes and insurance; and
acceptance of "fair" appraisal ratings for properties that might not
otherwise qualify. Bank also offers a consumer loan program called
BASIC that provides for direct extensions of credit for the purchase of
used and new automobiles by low-income households. Bank has also
indicated that it will provide a $5 million allocation for loans that do
not meet Neighborhood Advantage guidelines, including requiring no
private mortgage insurance on loans of up to 95 percent loan-to-value.
bility for the Neighborhood Advantage Program to
Bank in mid-1993.15
Bank offers a low-cost checking account called
Limited Checking Account. 16 Bank has also agreed,
subject to satisfactory credit review, to deposit
$100,000 in the credit union of Common Ground,
Dallas, Texas, which serves low-income residents of
West and South Dallas. Bank also makes grants,
through BankAmerica Foundation, to nonprofit organizations in Texas working to improve housing and
economic conditions in the communities Bank serves.
Bank has represented that its strategy following the
proposed transaction will be to focus primarily on
consumer and small business markets in Texas. In this
regard, Bank would acquire approximately $700 million in Texas consumer loans from First Gibraltar.
Following the proposed acquisition, BankAmerica will
bring other resources to the communities that First
Gibraltar currently serves. For example, Bank of
America State Bank, Concord, California ("BA State
Bank"), is planning to open an office in Texas to
service referrals from Bank for special affordable
housing, SB A and economic development financing.17
Bank has announced that following the acquisition of
First Gibraltar, Bank will have a 10-year, $1 billion
goal in CRA-related lending.18
The Board has also taken into account its recent
review of the CRA performance of BankAmerica and
all of its subsidiary banks, including those banks in
Texas, California and Arizona, in connection with
BankAmerica's acquisition of Security Pacific, which
was approved by the Board in March of this year. In
that case, the Board's review of the record of performance of BankAmerica was supplemented by four
public hearings that the Board held in California,
15. BankAmerica has indicated that it is providing mortgage loans to
Bank's Texas community through its lead bank in California because
Bank was only recently established in connection with the acquisition
of deposits and branches of failed Texas financial institutions and does
not yet have the infrastructure to make such loans. BankAmerica
expects to transfer all of its mortgage lending in Texas to Bank soon.
16. The account provides for a monthly service fee of $3.00, offers
10 free checks a month, and may be opened with a minimum of $25.00.
17. Bank has also represented that under its Branch Consolidation,
Relocation and Closure Policy, it will not close a branch in a
low-income community if Bank is the only provider of financial
services in the community. Customers of branches located in lowincome neighborhoods will receive at least 90 days advance notice of
branch consolidations and closures.
18. BankAmerica has indicated that Bank will not continue First
Gibraltar's Community Homebuyer Program and Affordable Housing
Program, which were offered in connection with First Gibraltar's
membership in the Federal Home Loan Bank System ("FHLBS").
Following the acquisition, BankAmerica will not be a member of the
FHLBS. However, BankAmerica has already begun implementing its
own programs to provide mortgage lending to low- and moderateincome communities in Texas, including the Neighborhood Advantage Program, and has committed to implement that program fully in
Texas through Bank.
Legal Developments
Washington and Arizona. The Board notes that Bank
of America has received an "outstanding" rating for
CRA performance from its primary regulator, the
Office of the Comptroller of the Currency ("OCC"),
in its most recent examination for CRA performance
in October 1990. All of the other subsidiary banks of
BankAmerica, including its subsidiary in Arizona,
have received at least a "satisfactory" rating from
their primary regulators in their most recent examinations for CRA performance. 19 First Gibraltar received an "outstanding" CRA rating from its primary regulatory, the Office of Thrift Supervision, in
January 1991. In none of these examinations was any
evidence of illegal discrimination found. BankAmerica has committed to implement its corporate CRA
program at Bank following consummation of this
proposal. 20
Protestants have raised questions regarding
whether BankAmerica has fully implemented commitments it made to the Board regarding its CRA
performance in connection with the acquisition
earlier this year of Security Pacific. BankAmerica
has taken a number of significant steps to comply
with those commitments. For example, in California, Bank of America has established $90 million
in special allocations for credit-worthy Neighborhood Advantage and/or minority applicants who do
not meet the Neighborhood Advantage guidelines
for mortgage loans. In addition, Bank of America
is now offering financial incentives for loan officers to originate loans to creditworthy minority
and low-income applicants, and now requires a
three-step review process for all declined minority and low-income census tract mortgage loan
applications. 21 Bank of America has represented
that as a result of these and other efforts, 22
19. The OCC is currently conducting the first CRA examination of
Bank.
20. Under the program, Bank's CRA program would be coordinated
by its Community Development Officer. The Community Development Officer supervises a team of six Neighborhood Development
Officers ("NDOs") throughout Texas. Four of the NDOs are black,
while two are Hispanic. With the guidance of the NDOs, district
managers, branch managers and other branch personnel make
monthly calls to identified census tracts and neighborhoods to identify
credit needs. This information is compiled and presented monthly to
senior management and quarterly to the board of directors.
21. Bank of America has also replaced Security Pacific's checking
account aimed at government assistance recipients with its own
Limited Checking Account, available to all customers for $3.50 per
month, and has represented that it stands ready to invest $200,000 in
a new South Central Los Angeles Federal Community Development
Credit Union when it becomes operational. Bank of America has also
increased its marketing to low- and moderate-income and minority
communities through a radio, newspaper and billboard campaign.
Approximately one-third of Bank of America's branches are in
low-income census tracts.
22. Bank of America has replaced Security Pacific's small business
lending program with a new product, Advantage Business Credit,
which includes loans and lines of credit of up to $50,000. In addition,
Bank of America established a pool of $25.0 million for unsecured
151
its loans in low- and moderate-income areas have
increased. 23
BankAmerica's banks in other states also have
taken steps to comply with their commitments. For
example, Bank of America Arizona, Phoenix, Arizona
("BA Arizona"), has made 265 loans totaling approximately $10.6 million to low-income individuals during
the first six months of 199224 and offers the Neighborhood Advantage Program in four different forms. 25 In
Washington state, Seattle-First National Bank, Seattle, Washington ("Seafirst"), has continued to support
the Washington Housing Finance Commission
("WHFC") for multi-family and special needs housing
loans by investing directly in tax credits through the
Low Income Housing Tax Credit Program. 26 In Nevada, Valley Bank of Nevada, Las Vegas, Nevada,
has recently completed negotiations with Nevada
community coalitions regarding the expansion of the
Neighborhood Advantage Program in Nevada, and is
continuing its efforts to establish a branch in West Las
Vegas, Nevada. 27
The Board believes that, during the eight months
since its acquisition of Security Pacific, BankAmerica
has demonstrated steady progress in fulfilling the commitments it made to the Board in connection with its
application to acquire Security Pacific. The Board expects BankAmerica to fulfill all of the commitments it
made to the Board including all of the steps and
programs that BankAmerica committed to implement in
connection with its acquisition of Security Pacific. The
Federal Reserve System will continue to monitor carefully BankAmerica's efforts in this area.
loans of up to $100,000 to merchants who suffered damages in the Los
Angeles disturbances of April 29 and 30, 1992. To date, 487 loans
totaling $21.9 million have been committed.
23. During the first six months of 1992, Bank of America made
$562 million in loans to all low-income census tracts in California, as
compared to $586 million for all of 1991, $482 million for 1989, and
$165 million for 1988.
24. BankAmerica has represented that this figure does not include
loans made to middle- and upper-income loan applicants who reside in
predominately low-income zip code areas. BA Arizona extended
during the first six months of 1992 approximately $2.4 million in loans
under the SBA and other special small business loan programs and
approximately $8.2 million in conventional small business loans of
under $50,000.
25. These are: a geographically-based 90 percent loan-to-value loan
product, a geographically-based 95 percent loan-to-value loan product, an income-based product at both 90 percent and 95 percent
loan-to-value, and a downpayment assistance program. In addition,
BA Arizona has offered, as a special promotion of its Neighborhood
Advantage Program, to waive fees associated with the application,
including credit report and appraisal fees, for loan applicants in
low-income census tracts.
26. Seafirst has purchased $1.2 million in tax credits to date and has
also lent $4 million through the WHFC's House Key '92 program for
first time home buyers. Seafirst has provided $1.1 million in funds
through WHFC's Small Tax Exempt Purchase Program. Seafirst also
earlier this year announced a $2 million loan program for nonprofit
organizations in the city of Tacoma.
27. Valley Bank of Nevada has also expanded its Homeless Check
Cashing Program.
152
Federal Reserve Bulletin • February 1993
Based on these and other facts of record, the Board
concludes that convenience and needs considerations,
including the record of BankAmerica and Bank under
the CRA, are consistent with approval of this application. 28
The Board also concludes that the financial and
managerial resources and future prospects of BankAmerica and Bank are consistent with approval of this
application. Moreover, the record in this case shows
that:
(1) The transaction will not result in the transfer of
any federally insured depository institution's federal
deposit insurance from one federal deposit insurance fund to the other;
(2) BankAmerica and Bank currently meet, and
upon consummation of the proposed transaction will
continue to meet, all applicable capital standards;
and
(3) Since Bank is in Texas and is acquiring certain
assets and assuming certain liabilities of a Texas
federal savings bank, the proposed transaction
would comply with the Douglas Amendment if First
Gibraltar were a state bank that BankAmerica was
applying to acquire directly. See 12 U.S.C.
§ 1815(d)(3).
Based on the foregoing and all of the facts of record,
the Board has determined that this application should
be, and hereby is, approved. 29 This approval is subject
to Bank obtaining the required approval of the appropriate Federal banking agency for the proposed merger
under the Bank Merger Act. The Board's approval of
this application also is conditioned upon BankAmerica's compliance with the commitments made in
connection with this application. For purposes of this
action, the commitments and conditions relied on in
reaching this decision are both conditions imposed in
writing by the Board and, as such, may be enforced in
proceedings under applicable law. This approval is
limited to the proposal presented to the Board by
BankAmerica, and may not be construed as applying
to any other transaction.
This transaction may not be consummated before
the thirtieth calendar day after the effective date of this
letter, or later than three months after the effective
date of this letter, unless such period is extended by
the Board or the Federal Reserve Bank of San Francisco, acting pursuant to delegated authority. In connection with this provision, advice of the fact of
consummation should be given in writing to the
Reserve Bank.
Very truly yours,
28. One Commenter requested that the Board reopen the public
comment period to permit the consideration of Commenter's appeal
under the Freedom of Information Act ("FOIA"), 5 U.S.C. § 552, for
certain portions of the application that were withheld from Commenter as confidential under the FOIA. In light of the fact that the
comment period was previously extended two weeks in order to give
Commenter an opportunity to submit comments, Commenter's delay
in filing the appeal, and other facts of record, the Board has denied
Commenter's request to reopen the public comment period.
Commenters have requested that the Board hold a public hearing or
meeting in this case. Neither section 5(d)(3) of the FDI Act nor the
Bank Merger Act provide for or require the Board to hold a public
meeting or public hearing on applications presented to the Board
pursuant to these provisions. In evaluating this request, the Board has
considered that Commenters have been provided an opportunity to
submit written comments to the Board, and have in fact submitted
substantial written comments. In addition, as noted above, the Board
recently held four public meetings in California, Washington and
Arizona to assess the performance of BankAmerica under the CRA.
In light of these facts and all the facts of record, including relevant
examination information, the Board believes that a public hearing or
meeting is not warranted in this case, and has denied this request.
JENNIFER J . JOHNSON
Associate Secretary of the Board
cc: Federal Reserve Bank of San Francisco
Tom Hesselbrock, Federal Deposit Insurance
Corporation
Office of the Comptroller of the Currency
Department of Justice
29. Voting for this action: Chairman Greenspan and Governors
Angell, Kelley, LaWare, Lindsey, and Phillips. Absent and not
voting: Governor Mullins.
Legal Developments
ACTIONS
1991
TAKEN
UNDER THE FEDERAL DEPOSIT INSURANCE
CORPORATION
IMPROVEMENT
153
ACT OF
By the Director of the Division of Banking Supervision and Regulation and the General Counsel of
the Board
Copies are available upon request to the Freedom of Information Office, Office of the Secretary, Board of
Governors of the Federal Reserve System, Washington, D.C. 20551.
Bank Holding Company
Acquired
Thrift
AmSouth Bancorporation,
Birmingham, Alabama
Secor Bank, F.S.B.,
Birmingham, Alabama
Fifth Third Bancorp,
Cincinnati, Ohio
Home Savings of
America, F.S.B.,
Irwindale, California
Champion Federal
Savings and Loan
Association,
Bloomington, Illinois
First of America Bank
Corporation,
Kalamazoo, Michigan
First Union Corporation,
Charlotte, North Carolina
Fishback Insurance Agency,
Inc.,
Brookings, South Dakota
Stichting Prioriteit ABN AMRO
Holding,
The Netherlands
Stichting Administratiekantoor
ABN AMRO Holding,
The Netherlands
ABN AMRO Holding, N.V.,
The Netherlands
ABN AMRO Bank N.V.,
The Netherlands
ABN AMRO North America,
Inc.,
Chicago, Illinois
LaSalle National Corporation,
Chicago, Illinois
Valley National Bancorp,
Wayne, New Jersey
Decatur Federal Savings
and Loan Association,
Decatur, Georgia
Home Trust Savings and
Loan Association,
Vermillion, South
Dakota
LaSalle Talman Bank,
Chicago, Illinois
Mayflower Savings Bank,
SLA,
Livingston, New Jersey
Surviving
Bank(s)
AmSouth Bank,
N.A.,
Birmingham,
Alabama
Fifth Third Bank,
Cincinnati, Ohio
First of America
Bank-McLean
County, N.A.,
Bloomington,
Illinois
First Union National
Bank of Georgia,
Atlanta, Georgia
First National Bank
in Brookings,
Brookings, South
Dakota
LaSalle Bank
Northbrook,
Northbrook, Illinois
Valley National
Bank,
Passaic, New
Jersey
Approval
Date
December 17, 1992
December 8, 1992
December 4, 1992
December 2, 1992
December 18, 1992
December 22, 1992
December 23, 1992
154
Federal Reserve Bulletin • February 1993
APPLICATIONS
APPROVED
UNDER BANK HOLDING
COMPANY
ACT
By the Secretary of the Board
Recent applications have been approved by the Secretary of the Board as listed below. Copies are available upon
request to the Freedom of Information Office, Office of the Secretary, Board of Governors of the Federal Reserve
System, Washington, D.C. 20551.
Section 3
Applicant(s)
Effective
Date
Bank(s)
Puget Sound Bancorp,
Tacoma, Washington
KeyCorp,
Albany, New York
December 17, 1992
Section 4
Applicant(s)
Effective
Date
Bank(s)
SouthTrust Corporation,
Birmingham, Alabama
Prime Bancshares, Inc.,
Decatur, Georgia
December 18, 1992
Sections 3 and 4
Integra Financial Corporation,
Pittsburgh, Pennsylvania
APPLICATIONS
APPROVED
Effective
Date
Bank(s)
Applicant(s)
Equimark Corporation,
Pittsburgh, Pennsylvania
UNDER BANK HOLDING
COMPANY
December 1, 1992
ACT
By Federal Reserve Banks
Recent applications have been approved by the Federal Reserve Banks as listed below. Copies are available upon
request to the Reserve Banks.
Section 3
Applicant(s)
Banc West, Inc.,
Edmond, Oklahoma
BOI Financial Corp.,
Normal, Illinois
Bank(s)
Leedey Bancorporation,
Inc.,
Leedey, Oklahoma
Thomas Bancshares, Inc.,
Thomas, Oklahoma
Bank of Illinois in
Normal,
Normal, Illinois
Reserve
Bank
Effective
Date
Kansas City
December 4, 1992
Chicago
December 18, 1992
Legal Developments
155
Section 3—Continued
Applicant(s)
Button Gwinnett Bancorp, Inc.,
Snellville, Georgia
CBI-Kansas, Inc.,
Kansas City, Missouri
Centennial Bank Holdings, Inc.,
Denver, Colorado
CNB Financial Corp.,
Canajoharie, New York
Comerica Incorporated,
Detroit, Michigan
Commerce Bancshares, Inc.,
Kansas City, Missouri
El Paso Bancshares, Inc.,
Monument, Colorado
Farmers National Bancshares,
Inc.,
Stafford, Kansas
First Busey Corporation,
Urbana, Illinois
First Fabens Bancorporation,
Inc.,
Fabens, Texas
Fourth Financial Corporation,
Wichita, Kansas
Franklin Bancorp, Inc.,
Minneapolis, Minnesota
GAB Bancorp,
Jasper, Indiana
Reserve
Bank
Bank(s)
The Gwinnett Financial
Corporation,
Lawrenceville, Georgia
Union Financial
Corporation,
Manhattan, Kansas
Eaton Capital
Corporation,
Eaton, Colorado
Colorado Industrial Bank,
Eaton, Colorado
Central National Bank,
Canajoharie,
Canajoharie, New York
Sugar Creek National
Bank,
Sugar Land, Texas
Manufacturers Bancorp,
Inc.,
Leavenworth, Kansas
First National Bank of
Bonner Springs,
Bonner Springs, Kansas
Lenexa Bancorporation,
Inc.,
Lenexa, Kansas
Union Financial
Corporation,
Manhattan, Kansas
Western Bank,
Taos, New Mexico
The Farmers National
Bank,
Stafford, Kansas
Empire Capital
Corporation,
LeRoy, Illinois
Bancshares of Ysleta,
Inc.,
El Paso, Texas
Bank of Ysleta,
El Paso, Texas
Southgate Banking
Corporation,
Prairie Village, Kansas
Park Financial of
St. Paul, Inc.,
St. Paul, Minnesota
Unibancorp,
Loogootee, Indiana
Effective
Date
Atlanta
December 15, 1992
Kansas City
November 27, 1992
Kansas City
December 21, 1992
New York
December 1, 1992
Chicago
December 3, 1992
Kansas City
November 27, 1992
Kansas City
November 30, 1992
Kansas City
December 1, 1992
Chicago
December 24, 1992
Dallas
December 1, 1992
Kansas City
December 21, 1992
Minneapolis
December 24, 1992
St. Louis
December 24, 1992
156
Federal Reserve Bulletin • February 1993
Section 3—Continued
Applicant(s)
Harlingen Bancshares, Inc.,
Harlingen, Texas
HN Bancshares of Delaware,
Inc.,
Wilmington, Delaware
Norwest Corporation,
Minneapolis, Minnesota
Omnibank Corporation,
River Rouge, Michigan
Peoples Mid-Illinois Corporation,
Bloomington, Illinois
PMI Acquisition Corporation,
Bloomington, Illinois
Random Lake Bancorp.,
Limited,
Random Lake,
Wisconsin
U B & T Holding Co.,
Abilene, Texas
Union Planters Corporation,
Memphis, Tennessee
VSB Bancorp,
Inc.,
Closter, New Jersey
Reserve
Bank
Bank(s)
Harlingen National
Bancshares, Inc.,
Harlingen, Texas
Harlingen National Bank,
Harlingen, Texas
Merchants & Miners
Bancshares, Inc.,
Hibbing, Minnesota
Omnibank,
River Rouge, Michigan
Lexington Bancshares,
Inc.,
Lexington, Illinois
Lexington Bancshares,
Inc.,
Lexington, Illinois
State Bank of Random
Lake,
Random Lake,
Wisconsin
United Bank & Trust,
Abilene, Texas
Bank of East Tennessee,
Knoxville, Tennessee
Valley Savings Bank,
SLA,
Closter, New Jersey
Effective
Date
Dallas
December 3, 1992
Minneapolis
December 17, 1992
Chicago
December 3, 1992
Chicago
December 21, 1992
Chicago
December 21, 1992
Chicago
December 18, 1992
Dallas
December 15, 1992
St. Louis
December 1, 1992
New York
December 1, 1992
Section 4
Applicant(s)
Banc One Corporation,
Columbus, Ohio
PNC Financial Corp,
Pittsburgh, Pennsylvania
Society Corporation,
Cleveland, Ohio
Brooke Holdings, Inc.,
Jewell, Kansas
Brooke Corporation,
Jewell, Kansas
Consolidated Holding Company,
Oldham, South Dakota
Nonbanking
Activity/Company
Reserve
Bank
Effective
Date
Electronic Payments
Services, Inc.,
Wilmington, Delaware
Cleveland
November 30, 1992
Mid Kansas Insurance
Agency, Inc.,
Wichita, Kansas
Kansas City
December 23, 1992
Farmers Investment
Company,
Olkham, South Dakota
Minneapolis
December 22, 1992
Legal Developments
157
Section 4—Continued
Applicant(s)
CoreStates Financial Corp,
Philadelphia, Pennsylvania
Credit Commercial de France,
Paris, France
Mellon Bank Corporation,
Pittsburgh, Pennsylvania
Credit Commercial de France
S.A.,
Paris, France
The First National Bank of
Boston,
Boston, Massachusetts
First Tennessee National
Corporation,
Memphis, Tennessee
First Union Corporation,
Charlotte, North Carolina
Mellon Bank Corporation,
Pittsburgh, Pennsylvania
Norwest Corporation,
Minneapolis, Minnesota
Norwest Corporation,
Minneapolis, Minnesota
Peoples Financial Services, Inc.,
Cookeville, Tennessee
Society Corporation,
Cleveland, Ohio
Southern Bank Group, Inc.,
Roswell, Georgia
Union Planters Corporation,
Memphis, Tennessee
Nonbanking
Activity/Company
Electronic Payment
Services, Inc.,
Wilmington, Delaware
CCF-Mellon Partners,
Pittsburgh,
Pennsylvania
Pilgrim Baxter Grieg
Framlington &
Associates Ltd.,
Wayne, Pennsylvania
BancBoston Leasing
Services, Inc.,
Boston, Massachusetts
Home Financial
Corporation,
Johnson City,
Tennessee
DFSoutheastern, Inc.,
Decatur, Georgia
to engage in investment
advisory activities
Comprehensive Computer
Solutions, Inc.,
Spring Valley,
New York
to engage de novo in
community activities
through its investment
in limited partnerships
that qualify for
low-income tax credits
under the Internal
Revenue Code
Citizens Federal Savings
Bank,
Rockwood, Tennessee
First Federal Savings and
Loan Association of
Fort Myers,
Fort Myers, Florida
Eastside Bank and Trust
Company,
Snellville, Georgia
SaveTrust Federal
Savings Bank,
Dyersburg, Tennessee
Reserve
Bank
Effective
Date
Philadelphia
November 30, 1992
New York
December 11, 1992
New York
December 18, 1992
Boston
December 24, 1992
St. Louis
December 9, 1992
Richmond
December 2, 1992
Cleveland
December 11, 1992
Minneapolis
December 17, 1992
Minneapolis
December 17, 1992
Atlanta
December 17, 1992
Cleveland
November 25, 1992
Atlanta
December 18, 1992
St. Louis
December 2, 1992
158
Federal Reserve Bulletin • February 1993
Section 4—Continued
Applicant(s)
Union Planters Corporation,
Memphis, Tennessee
U.S. Trust Corporation,
New York , New York
Wishek Bancorporation, Inc.
Wishek, North Dakota
APPLICATIONS
APPROVED
Nonbanking
Activity/Company
Security Trust Federal
Savings and Loan
Association,
Knoxville, Tennessee
Campbell, Cowperthwaite
& Co., Inc.,
New York , New York
to engage in direct lending
to nonshareholders and
noninsiders up to an
aggregate amount of
$250,000
UNDER BANK MERGER
Reserve
Bank
Effective
Date
St. Louis
December 2, 1992
New York
December 1, 1992
Minneapolis
November 25, 1992
ACT
By Federal Reserve Banks
Recent applications have been approved by the Federal Reserve Banks as listed below. Copies are available upon
request to the Reserve Banks.
Applicant(s)
Bank of Neosho,
Neosho, Missouri
Belcaro Bank,
Glendale, Colorado
Community Bank and Trust
Company,
Forest City, Pennsylvania
First United Bank,
Aurora, Colorado
Granby Bancshares, Inc.,
Neosho, Missouri
Bank(s)
Anderson State Bank,
Anderson, Missouri
Citizens State Bank,
Granby, Missouri
Denver Tec Bank,
Denver, Colorado
The Professional Bank of
Colorado,
Englewood, Colorado
First National Bank of
Nicholson,
Nicholson,
Pennsylvania
The Bank of Parker,
Parker, Colorado
Anderson Bancshares,
Inc.,
Neosho, Missouri
Neosho Bancshares, Inc.,
Neosho, Missouri
Reserve
Bank
Effective
Date
Kansas City
December 16, 1992
Kansas City
December 16, 1992
Philadelphia
December 17, 1992
Kansas City
December 23, 1992
Kansas City
December 16, 1992
Legal Developments
PENDING CASES INVOLVING
THE BOARD OF
GOVERNORS
This list of pending cases does not include suits
against the Federal Reserve Banks in which the Board
of Governors is not named a party.
CBC, Inc. v. Board of Governors, No. 92-9572 (10th
Cir., filed December 2, 1992). Petition for review of
civil money penalty assessment against a bank holding company and its officers, directors, and shareholders, for failure to comply with reporting requirements.
DLG Financial Corporation v. Board of Governors,
No. 392 Civ. 2086-G (N.D. Texas, filed October 9,
1992). Action to enjoin the Board and the Federal
Reserve Bank of Dallas from taking certain enforcement actions, and seeking money damages on a
variety of tort and contract theories. On October 9,
1992, the court denied plaintiffs' motion for a temporary restraining order. On November 20, 1992,
the Board filed a motion to dismiss. On December 17, 1992, plaintiffs filed an amended complaint.
Castro v. Board of Governors, No. 92-1764 (D. District of Columbia, filed July 29, 1992). Freedom of
Information Act case. On November 30, 1992, the
action was dismissed on plaintiff's motion.
Board of Governors v. bin Mahfouz, No. 92-CIV-5096
(S.D. New York, filed July 8, 1992). Action to freeze
assets of individual pending administrative adjudication of civil money penalty assessment by the
Board. On July 8, 1992, the court issued a temporary
restraining order restraining the transfer or disposition of the individual's assets. On October 30, the
parties filed a stipulation of dismissal without prejudice.
Zemel v. Board of Governors, No. 92-1057 (D. District
of Columbia, filed May 4, 1992). Age Discrimination
in Employment Act case.
Fields v. Board of Governors, No. 92-3920 (6th Cir.,
filed September 14, 1992). Federal Tort Claims Act
complaint alleging misrepresentation during application process. The district court for the Northern
District of Ohio granted the Board's motion to
dismiss on August 10, 1992. On September 14, 1992,
the plaintiff filed a notice of appeal. The action was
voluntarily dismissed by plaintiff/appellant on December 18, 1992.
State of Idaho, Department of Finance v. Board of
Governors, No. 92-70107 (9th Cir., filed February
159
24, 1992). Petition for review of Board order returning without action a bank holding company application to relocate its subsidiary bank from Washington
to Idaho. The Board's brief was filed on June 29,
1992. Oral argument was held October 6, 1992.
In re Subpoena Served on the Board of Governors,
Nos. 91-5427, 91-5428 (D.C. Cir., filed December
27, 1991). Appeal of order of district court, dated
December 3, 1991, requiring the Board and the
Office of the Comptroller of the Currency to produce
confidential examination material to a private litigant. On June 26, 1992, the court of appeals affirmed
the district court order in part, but held that the bank
examination privilege was not waived by the agencies' provision of examination materials to the examined institution, and remanded for further consideration of the privilege issue.
First Interstate BancSystem of Montana, Inc. v.
Board of Governors, No. 91-1525 (D.C. Cir., filed
November 1, 1991). Petition for review of Board's
order denying on Community Reinvestment Act
grounds the petitioner's application under section 3
of the Bank Holding Company Act to merge with
Commerce BancShares of Wyoming, Inc. On December 14, 1992, the court granted the parties' joint
motion to dismiss the case.
Board of Governors v. Kemal Shoaib, No. CV 91-5152
(C.D. California, filed September 24, 1991). Action
to freeze assets of individual pending administrative
adjudication of civil money penalty assessment by
the Board. On October 15, 1991, the court issued a
preliminary injunction restraining the transfer or
disposition of the individual's assets.
Board of Governors v. Ghaith R. Pharaon, No. 91CIV-6250 (S.D. New York, filed September 17,
1991). Action to freeze assets of individual pending
administrative adjudication of civil money penalty
assessment by the Board. On September 17, 1991,
the court issued an order temporarily restraining the
transfer or disposition of the individual's assets.
Fields v. Board of Governors, No. 3:91CV069 (N.D.
Ohio, filed February 5, 1991). Appeal of denial of
request for information under the Freedom of Information Act. The Board's motion for summary judgment was granted in part and its motion to dismiss
was denied on June 23, 1992.
160
Federal Reserve Bulletin • February 1993
FINAL ENFORCEMENT DECISION ISSUED BY THE
BOARD OF GOVERNORS
United States of America
Before the Board of Governors of the Federal Reserve
System
Washington, D.C.
In the Matter of
VIC SATHER &
ASSOCIATES, INC.
and
PAUL C. HUFNAGLE,
Docket Nos.
91-017-CMP-HC
91-017-CMP-I
Respondents.
Final Decision and Order
This is an administrative civil money penalty action
brought by the Board of Governors of the Federal
Reserve System (the "Board") against Respondents
Vic Sather & Associates, Inc. ("VSA"), a bank holding company in Bloomington, Minnesota, and its sole
officer, sole director, and principal shareholder, Paul
C. Hufnagle. On May 31, 1991, under the authority of
12 U.S.C. § 1847, the Board issued Notices of Assessment of Civil Money Penalties in the amounts of
$50,000 against Hufnagle and $25,000 against VSA,
alleging that the Respondents had repeatedly failed to
file with the Board timely or accurate regulatory
reports required by statute and regulation.
The Respondents requested a hearing, which was
held before Administrative Law Judge Paul J. Clerman
(the "ALJ") on December 3, 1991, in Minneapolis.
Following the hearing and the filing of post-hearing
briefs by Respondents and by the Board's Enforcement Counsel, the ALJ issued a Recommended Decision finding that the allegations in the Notices had
been established and that Respondents had in fact
failed to file timely and accurate reports, that the
failures were not excused, and that the failures constituted violations of the Bank Holding Company Act
and Regulation Y. The ALJ recommended, however,
that the penalties be assessed, not in the amounts
sought by Enforcement Counsel, but at the lower
amounts of $5,000 against VSA and $15,000 against
Hufnagle. The ALJ based the lower recommended
penalties upon his findings that VSA was in "extreme
financial distress" and was being sold for the benefit of
a creditor, that Respondents had not received pecuniary benefit from the violations, and that Hufnagle is
unlikely to return to banking "soon", and therefore
does not require a higher penalty to deter him from
future violations. Recommended Decision ("RD") 15.
Respondents have filed no exceptions to the Recommended Decision, and are therefore deemed to have
waived objection to the Recommended Decision,
Findings and Conclusions. Enforcement Counsel, on
the other hand, has excepted to the lower recommended penalty amounts, arguing that the initial
higher penalty assessments were fully justified by the
evidence produced at the hearing. 1
Statutory and Regulatory
Framework
The Bank Holding Company Act of 1956 (the "BHC
Act") charges the Board with exclusive authority to
administer the BHC Act and to issue such orders and
regulations as may be necessary to enable the Board to
carry out the purposes of the Act and to prevent
evasions thereof. 12 U.S.C. § 1844(b). The BHC Act
also specifically authorizes the Board to require reports under oath from time to time to monitor compliance with the provisions of the BHC Act and its
implementing regulations and orders. 12 U.S.C.
§ 1844(c). The Board's Regulation Y implements this
authorization by requiring that each bank holding
company furnish, in the manner and form prescribed
by the Board, an annual report of the company's
operations, and additional information and reports as
required by the Board. 12 C.F.R. 225.5(b).
The instructions on Federal Reserve Form FR Y-6
require each bank holding company to submit an
annual report within 90 days of the end of the company's fiscal year (the "Y-6 Report"). The instructions for Federal Reserve Form FR Y-9SP require that
any bank holding company with only one subsidiary
bank and consolidated assets of less than $150 million
file reports for the parent company on a semiannual
basis, within 45 days of the last day of June and
December each year (the "Y-9 Report"). Exhibit 10 at
1, 6. The instructions also require that the bank
holding company's financial records be maintained in
such a manner and scope so as to ensure that the
reports can be prepared and filed in accordance with
the instructions and "reflect a fair presentation of the
bank holding company's financial condition and results of operations." Exhibit 10 at 4.
1. Enforcement Counsel also excepts on technical grounds to
several details in the ALJ's recommended conclusions of law unrelated to the issue of the penalty amount. The Board adopts each of
these exceptions as technical corrections.
Legal Developments
The BHC Act provides for civil money penalties of
up to $25,000 per day against any company which
violates, and any individual who participates in a
violation of any provision of the Act or of any regulation or order implementing the Act. 12 U.S.C.
§ 1847(b)(1). The term "violates" is defined to include
"any action, (alone or with another or others) for or
toward causing, bringing about, participating in, counseling, or aiding and abetting a violation." 12 U.S.C.
§ 1847(b)(5). The BHC Act also prescribes a separate
schedule of penalties, ranging from $2,000 to $1 million
per day or one percent of the assets of the company
(depending on the seriousness of the violation), for any
company that fails to make, submit, or publish timely
reports or information required by the Board, or which
submits or publishes any false or misleading report or
information. 12 U.S.C. § 1847(d)(l)-(3).2
In determining the amount of any civil money penalty, the Board takes into account the appropriateness
of the penalty with respect to any of the statutorilyspecified mitigating factors established by the record:
the size of financial resources and good faith of the
company or person charged, the gravity of the violation, the history of previous violations, and such
other matters as justice may require. 12 U.S.C.
§§ 1847(b)(2), (d)(4); 1818(i)(2)(G).
Findings of Fact and Conclusions of Law
Upon review of the administrative record, the Board
hereby adopts such of the recommended findings and
conclusions of the ALJ as are not specifically modified
herein as the final findings and conclusions of the
Board, together with the ALJ's reasoning and citations
to the record. For the reasons stated below, the Board
adopts the ALJ's recommendations on the appropriate
amount of the penalties, and assesses penalties in the
amount of $15,000 against Hufnagle, and $5,000
against VSA.
VSA is a bank holding company, registered with the
Board under the BHC Act, that owns 90 percent of the
stock of one subsidiary bank, Franklin State Bank of
Franklin, Minnesota ("the Bank"). The consolidated
asset size of VSA and the Bank totals about $8 million.
At all times relevant to the proceeding, Hufnagle has
been the sole officer and director and the principal
2. The ceiling for such violations is set at $2,000 per day for any
company which violates reporting requirements if the company can
establish that it "maintains procedures reasonably adapted to avoid
any inadvertent error and, unintentionally and as a result of such an
error" commits the violation, or that the company "inadvertently
transmits or publishes any report which is minimally late." 12 U.S.C.
§ 1847(d)(1). The company bears the burden of proving that an error
was inadvertent or that a report was inadvertently transmitted or
published late. Id.
161
shareholder of VSA, and an officer and director of the
Bank.
Violations of Reporting
Requirements
The facts related to the violations are straightforward
and for the most part not in dispute. It is uncontested
that Hufnagle was responsible for VSA's compliance
with reporting obligations and that, from 1986 until the
initiation of this proceeding in 1991, VSA repeatedly
failed to file required reports on time. 3 As a predicate
for the penalties charged here, Enforcement Counsel
emphasized the late filing of the Y-9 report for yearend 1989 and both the Y-6 and the Y-9 reports for
year-end 1990.4
Besides being late, VSA's Y-6 and Y-9 reports for
1989 contained a number of mutually contradictory
entries that could not be reconciled, indicating that
one or both reports were inaccurate. RD Appendix E
at 1. For example, short-term borrowing for the period, which should have been an identical entry on
both forms, was stated to be $395,000 on the Y-9 and
zero on the Y-6. Exhibits 5, 6; Transcript ("Tr").
1-65. 5 At the hearing, Hufnagle conceded the inconsistencies, and could not identify which, if either, of
the reports was accurate. Tr. 1-125. 6
This pattern of reporting violations was the subject
of repeated criticisms by the Federal Reserve. The
May 15, 1986 Report of Inspection of VSA, which was
sent to VSA and to Hufnagle, stated that VSA's
recordkeeping was poor and that its FR Y-6 Reports
were consistently incomplete or inaccurate and noted
this as a violation of Regulation Y. Exhibit 1 at 2-3.
The Federal Reserve also sent a letter to Hufnagle on
August 21, 1987, warning him that his habitual tardiness in submitting required reports, together with
other deficiencies, could result in the assessment of
civil money penalties. Exhibit 2. A 1988 Report of
Inspection also criticized VSA's recordkeeping and
3. The Y-6 reports were filed late in each year from 1986 to 1990, and
the Y-9 reports were filed late for year-end 1986 through 1990 as well
as for mid-year 1987. RD 3-4.
4. The Y-9 report for the period ending December 31, 1989, due
February 14, 1990, was filed on March 12, 1990, 26 days past due.
Exhibit 5. Neither the Y-6 report nor the Y-9 report for year-end 1990
had been filed at the time that this case was initiated on May 31, 1991;
subsequently, the Y-6, due March 31,1991, was filed on June 13,1991,
and the Y-9, due February 14, 1991, was filed on July 2, 1991. RD
Appendix E at 2.
5. Other examples include the entry for "cash" held by VSA as of
12-31-89, listed as $1,000 on the Y-9 Report and $22,600 on the Y-6.
Tr. 1-64. The Y-9 listed 447,000 in liabilities as long-term, while the
FR Y-6 stated that all of the borrowings were short-term. Tr. 1-65.
There was no way for the Federal Reserve analysts to determine
which, if either, of these figures was accurate. Tr. 1-65.
6. "Your Honor, we will not attempt to persuade the Court that
these Y-9s and Y-6s mesh, because they don't." Counsel for Respondents, Tr. 1-125.
162
Federal Reserve Bulletin • February 1993
failure to comply with reporting requirements. Exhibit
3. Finally, a Federal Reserve letter of February 28,
1991, after the deadline for filing the 1990 Y-9 report
had passed, again warned Hufnagle that his continued
failure to file timely and accurate regulatory reports
could result in the assessment of civil money penalties.
Exhibit 7.
The record shows that, during this period, Hufnagle
on occasion "refused" to file reports under the terms
required by the Board, including the use of accrualbased accounting, and the exclusion of estimated data.
See, e.g., Exhibit 1 at 3; Exhibit 7.
Hufnagle's
Defenses7
The ALJ correctly rejected Hufnagle's argument that
no penalty could be assessed against him as an individual on the ground that the BHC Act does not
authorize penalties for reporting violations against
individuals, but only against companies. Hufnagle's
argument was based on the disparate wording of two
BHC Act penalty provisions: the general penalty provision, which expressly covers violations by individuals, and a separate provision specifically for reporting
violations, which does not expressly address individuals. The general civil money penalty provision authorizes a penalty of $25,000 per day against "[a]ny
company which violates, and any individual who participates in a violation of, any provision of [the Act],
or any regulation or order issued pursuant thereto."
12 U.S.C. § 1847(b)(1) (emphasis added). A separate
provision of the BHC Act added by 1989 legislation,8
entitled "Penalty for failure to make reports", establishes a schedule of penalties specifically for different
degrees of reporting violations by companies, but,
unlike the general penalty provision cited above, does
not specifically address violations by individuals.
12 U.S.C. § 1847(d). Hufnagle argued that the more
specific reporting penalty provision provides the exclusive penalty mechanism for reporting violations, so
that he, as an individual, is immune from penalty for
participation in VSA's reporting violations. Hufnagle
Brief 6-8. Under Hufnagle's theory, VSA bore the
sole responsibility for filing reports and Hufnagle's
responsibility for compliance runs only to VSA, and
not to the Board.
The Board adopts the ALJ's rejection of this argument and finds that individuals may be penalized under
7. While these defenses are technically not before the Board due to
the Respondents' failure to file exceptions, the Board has reviewed
the ALJ's rulings as to these arguments, and finds that the ALJ
correctly rejected each of them.
8. The "Financial Institutions Reform, Recovery, and Enforcement
Act of 1989" ("FIRREA"), Pub. L. 101-73, 103 Stat. 183 (1989).
section 1847(b)(1) for their participation in reporting
violations for which the companies are assessed under
Section 1847(d). The plain meaning of the text of
section 1847(b) authorizes penalties for any individual
who "participates in" a statutory or regulatory violation, 9 and nothing in the text of section 1847(d) conflicts with or restricts that general authority. While it is
not apparent why Congress established a separate
schedule of penalties applicable only to reporting
violations by companies, it is clear that Congress did
not expressly withdraw the Board's section 1847(b)
authority to penalize individuals for violations, including reporting violations. "[Legislative repeals by implication will not be recognized insofar as two statutes
are capable of co-existence 'absent a clearly expressed
congressional intention to the contrary.' " Astoria
Federal Sav. & Loan Ass'n v. Solimino, 111 S.Ct.
2166, 2170 (1991) (quoting Morton v. Moncari, 417
U.S. 535, 551 (1974)). Hufnagle has adduced no legislative history to support his restrictive interpretation.
Accordingly, there is no basis for interpreting the BHC
Act as establishing a safe harbor for individuals responsible for reporting violations.
The ALJ also properly rejected Hufnagle's arguments that the lateness and inaccuracy of VSA's
reports should be excused because they were not
"intentional", because the Respondents did not profit
from the violations, and because the reporting violations did not deceive the Board or otherwise hinder the
Board's regulatory function. Hufnagle Brief 3-6; RD
13. The ALJ correctly concluded that none of these
arguments stated a cognizable legal defense to the
existence of violations. RD 13. Reporting requirements are an affirmative obligation for bank holding
companies and affiliated individuals and a fundamental
aspect of the Board's responsibility for supervising
bank holding companies. A failure to comply with
those requirements constitutes a violation of law,
irrespective of the individual's state of mind, pecuniary motive, or the relative harm caused to the Board. 10
The ALJ also properly rejected Hufnagle's argument that Federal Reserve staff had led him to believe
that his reporting obligations would be satisfied by
"good faith best efforts" to comply. The ALJ correctly ruled that the issue was immaterial, since the
reporting requirements are not subject to informal
9. The reporting requirements are authorized by the BHC Act and
implemented through Regulation Y and the Y-6 and Y-9 Forms and
instructions that are adopted by Board order. Hufnagle controlled
VSA's actions as the sole shareholder, officer, and director of VSA,
and the person who signed, and in some cases, prepared, VSA's
reports. Accordingly, Hufnagle plainly "participated in" a violation of
statute, regulation, and order.
10. The ALJ also correctly noted, however, that these issues might
be relevant to mitigating the size of the penalty. RD 13.
Legal Developments
waiver by Federal Reserve staff. RD 14. Furthermore,
the ALJ found that no evidence supported Hufnagle's
version of his interaction with Federal Reserve staff
and that the Federal Reserve had repeatedly insisted in
official communications that the reporting requirements must be satisfied. RD 14.11
Amount of the Penalties
The primary issue before the Board is Enforcement
Counsel's exception to the amount of the penalties
recommended by the ALJ, a reduction from $50,000 to
$15,000 against Hufnagle and from $25,000 to $5,000
against VSA. Enforcement Counsel has identified no
specific flaws in the Recommended Decision that
contributed to what Enforcement Counsel views as
unduly low recommended penalty amounts. Upon
review, the Board denies Enforcement Counsel's exceptions and adopts the amounts recommended by the
ALJ. In so finding, however, the Board notes that the
pattern of violations established in this case might, in
a case presenting a different record as to mitigating
factors, justify a significantly higher penalty.
It is clear that the Board has statutory authority to
assess penalties that exceed either the amounts set
forth in the Notices of Assessment or the amounts
recommended by the ALJ. The BHC Act provides for
maximum penalties of $25,000 per day against Hufnagle, and of $20,000 per day against VSA, for reporting
violations of this degree. 12 Here, the number of days
that the violations were outstanding runs into the
hundreds, 13 so that the total amount that could be
assessed under the law far exceeds the amounts in
contention here.
The extremely large sums authorized by the BHC
Act, however, may be ameliorated by the Act's requirement that the Board consider the appropriateness
of the penalty with respect to mitigating factors:
11. The ALJ also correctly dismissed as "meritless" Hufnagle's
argument that the Board is precluded from assessing penalties now
because it did not do so earlier, and properly rejected the argument
that Hufnagle's service in the Minnesota legislature excused him from
reporting requirements. RD 14.
12. There is no question that VSA did not establish its entitlement
to the lower $2000 per day penalty applicable to companies that
commit inadvertent errors notwithstanding the maintenance of "procedures reasonably adapted to avoid any inadvertent error" or that is
"minimally late" due to inadvertence. 12 U.S.C. § 1847(d)(1)(A),(B).
Neither element is present here: The nonexistence of proper procedures was implicitly conceded by Hufnagle's argument that VSA
lacked the resources to maintain proper reporting procedures; the
reporting delinquencies at issue here, extending into weeks and
months, do not qualify as "minimally late".
13. The Y-9 for year-end 1989 was filed 26 days late, and the Y-6 and
Y-9 for year-end 1990 were each not filed until after the initiation of
this proceeding, each month after deadline. Furthermore, the inconsistencies in the Y-6 and Y-9 filed in 1990 have never been corrected
and remain outstanding.
163
(1) The size of the financial resources and good faith
of the respondent;
(2) The gravity of the violation;
(3) The history of previous violations; and
(4) Such other matters as justice may require.
12 U.S.C. § 1818(i)(2)(G); § 1847(b)(2), (d)(4). A
weighing of these factors persuades the Board that the
penalty amounts recommended by the ALJ are reasonable.
Financial Resources
The evidence produced at the hearing as to VSA's and
Hufnagle's financial resources forms a reasonable basis for a downward adjustment of the original assessments against VSA and Hufnagle. The ALJ found that
the financial evidence of record "leaves much to be
desired but there is enough to convince this Judge that
as a corporate entity [VSA] is in extreme financial
distress, and that Hufnagle's financial posture, visa-vis his ownership of and interest in the holding
company, is in a negative position." RD 15. The ALJ
also found that Hufnagle severed his relationships with
the Bank and with VSA shortly before the hearing and
had executed an agreement and power of attorney
empowering a creditor to sell VSA for the creditor's
benefit. The ALJ found that VSA's sale "will likely
yield no dollars at all to Hufnagle." RD 15.14
As evidence of Hufnagle's overall financial resources, Enforcement Counsel introduced a financial
statement for Hufnagle as of December 21, 1988 that
showed Hufnagle to have a net worth of $804,000.
Exhibit 8. In response, Hufnagle produced at the
hearing another financial statement, prepared for the
hearing as of December 3, 1991, that purported to
show that Hufnagle had a negative net worth of
$607,000. Exhibit 15. The ALJ found Hufnagle's statement unworthy of credence in several respects, finding
that the status of Hufnagle's financial relationships
with his father, and the valuation of his residence were
"far from clear". 15 RD 10-11, 15. Accordingly, the
ALJ found that Hufnagle's overall financial condition
could not be accurately determined from the record.
Id.16
14. Indeed, since Hufnagle personally guaranteed VSA's loan, the
creditor might be able to recover from Hufnagle any deficiency from
the sale of VSA. Exhibit 12 at 1.
15. The ALJ noted that much of that negative net worth consisted of
Hufnagle's debt to his father, which was never to be repaid but instead
was to be deducted from Hufnagle's expected inheritance. RD 11.
With that amount negated, and accepting Hufnagle's appraisal of his
house as worth $380,000, Hufnagle submitted that his negative net
worth was $77,000. RD 10-11.
16. Since financial resources are a mitigating factor under the
statute, and since the evidence as to those resources is for the most
164
Federal Reserve Bulletin • February 1993
On this admittedly incomplete record, 17 the Board
finds that the evidence tends to demonstrate that the
Respondents' financial resources have declined so as to
mitigate the original penalty amounts. While the ALJ
was appropriately skeptical as to some of Hufnagle's
claimed financial reverses, the ALJ reasonably credited
other aspects of Hufnagle's straitened circumstances.
The Board accordingly believes that the size of Respondents' financial resources warrants a lowering of the
penalty amounts from those originally assessed.
Good Faith
The ALJ concluded, even though he found the violations unintentional and not a source of profit to respondents (see RD 13, 15), that ultimately the continuation
of the violations displayed a lack of good faith. Recommended Conclusions of Law, RD Appendix E at 4-5.
There is support for this conclusion in Hufnagle's
pattern of resistance to compliance with the reporting
requirements.
Gravity of the Violations!Record of Previous
Violations
Reporting requirements are a fundamental component
of the Board's responsibility for supervising bank holding companies. The filing of a late or inaccurate regulatory report impairs and delays the Federal Reserve's
ability to assess accurately the condition of the bank
holding company involved, and may affect the Board's
ability to monitor the banking system generally.
The pattern of violations in this case includes relatively minor violations that grew into a more serious
pattern of repeated and longer reporting delinquencies.
The Respondents' violations also include more severe
violations such as inaccurate reports and the failure to
maintain a recordkeeping system on which accurate
reports could be based. The gravity and repetitive
nature of these violations weigh in favor of significant
penalties.
Other Factors Required by Justice
The ALJ observed that an assessment of a penalty
under the BHC Act serves the purposes of deterring
repeat violations by the Respondents (specific deter-
part within the control of the respondent, the weakness of the record
in this regard is properly chargeable to the Respondents. See Stanley
v. Board of Governors, 940 F.2d 267, 274 (7th Cir. 1991) (Board does
not bear full burden of proving financial resources).
17. The Board declines to remand the case for supplementation of
the record in light of the difficulty of achieving precision on this issue,
the absence of exceptions from the Respondents, and the absence of
any suggestion of the utility of a remand by Enforcement Counsel.
rence) and acting as a warning to other similar bank
holding companies and individuals (general deterrence). RD 15. Since the ALJ found that Hufnagle's
negative experience with VSA made it unlikely that he
would "soon" involve himself with another bank
holding company, the ALJ found that even the lower
recommended penalty amounts would suffice to deter
him from similar violations in the future. RD 15.
The Board believes that the ALJ erred in finding that
Hufnagle did not gain any pecuniary advantage from
his past violations. RD 15. That finding overlooks
Hufnagle's argument that it was financially infeasible
for VSA to employ the personnel necessary to achieve
compliance with the reporting requirements. Hufnagle
Brief at 4. It is therefore clear that, by failing to devote
the necessary resources to compliance, the Respondents saved expenses and therefore realized a pecuniary benefit. In part because the amount of that benefit
cannot be determined on this record, the Board declines to revise the recommended penalty amounts. 18
The Board expects, however, that where the record
shows that reporting violations have resulted from
avoidance of the costs of filing timely reports, the
amount of saved costs will be an important factor is
assessing an appropriate penalty. See, e.g., In re CBC,
Inc., No. 90-033-CMP, 79 Federal Reserve Bulletin
, slip op. at 5-6 (Nov. 18, 1992).
Upon consideration of all of the circumstances,
especially including the Respondents' financial resources, and the ALJ's findings as to penalty amounts
sufficient to achieve the goals of deterrence, the Board
adopts the penalty amounts recommended by the ALJ.
NOW, THEREFORE, IT IS HEREBY ORDERED, pursuant to sections 8(b) and (d) of the Bank
Holding Company Act, as amended (12 U.S.C.
§ 1847(b),(d)), that the below-named respondents are
hereby assessed, and shall forfeit and pay as hereinafter provided, civil money penalties in the amounts
specified below:
1. VIC SATHER & ASSOCIATES is hereby assessed and shall forfeit and pay a civil money penalty
in the amount of Five Thousand Dollars ($5,000); and
2. PAUL C. HUFNAGLE is hereby assessed and
shall forfeit and pay a civil money penalty in the
amount of Fifteen Thousand Dollars ($15,000).
IT IS FURTHER ORDERED that payment of the
assessed penalties set forth herein shall be made on or
before the sixtieth day following the effective date of
this Order, payable in full to the order of the Board of
Governors of the Federal Reserve System, who shall
make remittance of the same to the Treasury of the
18. As explained above, the Board does not find that a remand for
supplementation of the record would be useful in this case.
Legal Developments
United States as required by statute. Payment of the
assessed penalty shall be transmitted to:
William W. Wiles, Secretary
Board of Governors of the Federal
Reserve System
20th and C Streets, N.W.
Washington, D.C. 20551
By order of the Board of Governors, effective this
14th day of December, 1992.
WILLIAM W . WILES
Secretary of the Board
FINAL ENFORCEMENT ORDERS ISSUED BY THE
BOARD OF GOVERNORS
The Blackshear Bank
Blackshear, Georgia
The Federal Reserve Board announced on December 29, 1992, the joint issuance of a Cease and Desist
Order against the Blackshear Bank, Blackshear, Georgia, with the Department of Banking and Finance of
the State of Georgia.
The Farmers and Merchants Bank of
Long Beach
Long Beach, California
The Federal Reserve Board announced on December 29,1992, the issuance of an Order of Assessment of
a Civil Money Penalty against the Farmers and Merchants Bank of Long Beach, Long Beach, California.
Greater Ohio River Company
Columbus, Ohio
The Federal Reserve Board announced on December 23, 1992, the issuance of an Order of Assessment of
a Civil Money Penalty against Greater Ohio River
Company, Columbus, Ohio.
Industrial Bancshares, Inc.
Kansas City, Kansas
The Federal Reserve Board announced on December 21,
1992, the issuance of a Cease and Desist Order against
Industrial Bancshares, Inc., Kansas City, Kansas.
Mission Bancshares, Inc.
Mission, Kansas
The Federal Reserve Board announced on December 21, 1992, the issuance of a Cease and Desist Order
against Mission Bancshares, Inc., Mission, Kansas.
165
One Security, Inc.
Kansas City, Kansas
The Federal Reserve Board announced on December 21, 1992, the issuance of a Cease and Desist Order
against One Security, Inc., Kansas City, Kansas.
Sandquist Corporation
Deer Lodge, Montana
The Federal Reserve Board announced on December 8, 1992, the issuance of Orders of Assessment of a
Civil Money Penalty against Sandquist Corporation,
Deer Lodge, Montana, and Kirk Sandquist, an institution-affiliated party of Sandquist Corporation.
Valley View Bancshares, Inc.
Overland Park, Kansas
The Federal Reserve Board announced on December 21, 1992, the issuance of a Cease and Desist Order
against Valley View Bancshares, Inc., Overland Park,
Kansas.
WRITTEN AGREEMENTS
RESERVE
BANKS
APPROVED BY
FEDERAL
First Bank of Berne
Berne, Indiana
The Federal Reserve Board announced on December 8, 1992, the execution of a Written Agreement
between the Federal Reserve Bank of Chicago and the
First Bank of Berne, Berne, Indiana.
Pitcairn Bancorp, Inc.
Jenkintown, Pennsylvania
The Federal Reserve Board announced on December 17, 1992, the execution of a Written Agreement
between the Federal Reserve Bank of Philadelphia and
Pitcairn Bancorp, Inc., and Pitcairn Private Bank,
Jenkintown, Pennsylvania.
United Bank Corporation of N e w York
Downsville, N e w York
The Federal Reserve Board announced on December 8, 1992, the execution of a Written Agreement
between the Federal Reserve Bank of New York and
United Bank Corporation of New York, Downsville,
New York.
A1
Financial and Business Statistics
CONTENTS
WEEKLY REPORTING COMMERCIAL
A3 Guide to Tabular Presentation
Domestic Financial Statistics
BANKS
Assets and liabilities
A21 All reporting banks
A23 Branches and agencies of foreign banks
MONEY STOCK AND BANK CREDIT
FINANCIAL
A4
A24 Commercial paper and bankers dollar
acceptances outstanding
A24 Prime rate charged by banks on short-term
business loans
A25 Interest rates—money and capital markets
A26 Stock market—Selected statistics
A27 Selected financial institutions—Selected assets
and liabilities
A5
A6
A7
Reserves, money stock, liquid assets, and debt
measures
Reserves of depository institutions, Reserve Bank
credit
Reserves and borrowings—Depository
institutions
Selected borrowings in immediately available
funds—Large member banks
POLICY
INSTRUMENTS
FEDERAL
A8 Federal Reserve Bank interest rates
A9 Reserve requirements of depository institutions
A10 Federal Reserve open market transactions
FEDERAL RESERVE BANKS
A l l Condition and Federal Reserve note statements
A12 Maturity distribution of loan and security
holdings
MONETARY AND CREDIT
INSTITUTIONS
A18 Major nondeposit funds
A19 Assets and liabilities, last-Wednesday-of-month
series
FINANCE
A27
A28
A29
A29
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
A30 U.S. government securities
dealers—Transactions
A31 U.S. government securities dealers—Positions
and financing
A3 2 Federal and federally sponsored credit
agencies—Debt outstanding
AGGREGATES
A13 Aggregate reserves of depository institutions
and monetary base
A14 Money stock, liquid assets, and debt measures
A16 Bank debits and deposit turnover
A17 Loans and securities—All commercial banks
COMMERCIAL BANKING
MARKETS
SECURITIES MARKETS AND
CORPORATE
FINANCE
A33 New security issues—State and local
governments and corporations
A34 Open-end investment companies—Net sales
and asset position
A34 Corporate profits and their distribution
A34 Total nonfarm business expenditures on new
plant and equipment
A35 Domestic finance companies—Assets and
liabilities and business credit
2
Federal Reserve Bulletin • February 1993
Domestic Financial Statistics—Continued
A57 Selected U.S. liabilities to foreign official
institutions
REAL ESTATE
A36 Mortgage markets
A37 Mortgage debt outstanding
REPORTED BY BANKS
IN THE UNITED STATES
CONSUMER INSTALLMENT CREDIT
A51
A58
A60
A61
A3 8 Total outstanding and net change
A3 8 Terms
FLOW OF FUNDS
A39
A41
A42
A43
Funds raised in U.S. credit markets
Summary of financial transactions
Summary of credit market debt outstanding
Summary of financial assets and liabilities
Domestic Nonfinancial Statistics
Liabilities to and claims on foreigners
Liabilities to foreigners
Banks' own claims on foreigners
Banks' own and domestic customers' claims on
foreigners
A61 Banks' own claims on unaffiliated foreigners
A62 Claims on foreign countries—Combined
domestic offices and foreign branches
REPORTED BYNONBANKING BUSINESS
ENTERPRISES IN THE UNITED STATES
A63 Liabilities to unaffiliated foreigners
A64 Claims on unaffiliated foreigners
SELECTED MEASURES
SECURITIES HOLDINGS AND TRANSACTIONS
A44 Nonfinancial business activity—Selected
measures
A45 Labor force, employment, and unemployment
A46 Output, capacity, and capacity utilization
A47 Industrial production—Indexes and gross value
A49 Housing and construction
A50 Consumer and producer prices
A51 Gross domestic product and income
A52 Personal income and saving
A65 Foreign transactions in securities
A66 Marketable U.S. Treasury bonds and
notes—Foreign transactions
International Statistics
INTEREST AND EXCHANGE RATES
A67 Discount rates of foreign central banks
A67 Foreign short-term interest rates
A68 Foreign exchange rates
A69 Guide to Statistical Releases and
Special Tables
SUMMARY STATISTICS
SPECIAL TABLES
A53
A54
A54
A54
U.S. international transactions—Summary
U.S. foreign trade
U.S. reserve assets
Foreign official assets held at Federal Reserve
Banks
A55 Foreign branches of U.S. banks—Balance
sheet data
A70 Assets and liabilities of commercial banks,
September 30, 1992
A76 Terms of lending at commercial banks,
November 1992
A80 Assets and liabilities of U.S. branches and agencies
of foreign banks, September 30, 1992
A3
Guide to Tabular Presentation
SYMBOLS
c
e
n.a.
n.e.c.
P
r
*
0
ATS
CD
CMO
FFB
FHA
FHLBB
FHLMC
FmHA
FNMA
FSLIC
G-7
G-10
GENERAL
AND
ABBREVIATIONS
Corrected
Estimated
Not available
Not elsewhere classified
Preliminary
Revised (Notation appears on column heading
when about half of the figures in that column
are changed.)
Amounts insignificant in terms of the last decimal
place shown in the table (for example,' less than
500,000 when the smallest unit given is millions)
Calculated to be zero
Cell not applicable
Automatic transfer service
Certificate of deposit
Collateralized mortgage obligation
Federal Financing Bank
Federal Housing Administration
Federal Home Loan Bank Board
Federal Home Loan Mortgage Corporation
Farmers Home Administration
Federal National Mortgage Association
Federal Savings and Loan Insurance Corporation
Group of Seven
Group of Ten
GNMA
GDP
HUD
IMF
IO
IPCs
IRA
MMDA
NOW
OCD
OPEC
OTS
PO
REIT
REMIC
RP
RTC
SAIF
SCO
SDR
SIC
SMSA
VA
Government National Mortgage Association
Gross domestic product
Department of Housing and Urban
Development
International Monetary Fund
Interest only
Individuals, partnerships, and corporations
Individual retirement account
Money market deposit account
Negotiable order of withdrawal
Other checkable deposit
Organization of Petroleum Exporting Countries
Office of Thrift Supervision
Principal only
Real estate investment trust
Real estate mortgage investment conduit
Repurchase agreement
Resolution Trust Corporation
Savings Association Insurance Fund
Securitized credit obligation
Special drawing right
Standard Industrial Classification
Standard metropolitan statistical area
Veterans Administration
INFORMATION
In many of the tables, components do not sum to totals because
of rounding.
Minus signs are used to indicate (1) a decrease, (2) a negative
figure, or (3) an outflow.
"U.S. government securities" may include guaranteed issues
of U.S. government agencies (the flow of funds figures also
include not fully guaranteed issues) as well as direct obligations of the Treasury. "State and local government" also includes municipalities, special districts, and other political
subdivisions.
A4
Domestic Financial Statistics • February 1993
1.10
R E S E R V E S , M O N E Y STOCK, LIQUID ASSETS, A N D D E B T M E A S U R E S
Percent annual rate of change, seasonally adjusted1
1992
1991
1992
Monetary and credit aggregate
Reserves of depository
1 Total
2 Required
3 Nonborrowed
4 Monetary base 3
5
6
7
8
9
Q1
Q2
Q3
15.2
15.4
20.0
8.2
23.4
23.5
24.0
9.2
14.9
15.4
14.8
7.1
9.3
9.9
8.4
10.5
11.1
2.4
1.0
.2
3.9
16.5
4.2
2.2
1.5
4.3r
9.8
.4
— 1.3'
.5
5.4'
-.6
-5.4
-.1
-7.4
16.0
-8.4
-14.4
July
Oct.
Nov.
Aug.
Sept.
6.2
5.0
4.9
9.5
20.2
21.3
21.1
16.6
24.4
23.4
23.7
16.7
42.0
40.9
45.6
14.3
20.8
22.0
21.8
8.7
10.3
.2'
-.1'
1.2
4.2'
11.1
-.9
-1.1
-1.8'
3.9*
15.7
3.3
3.9*
4.5'
3.9*
19.1
3.7'
2.0'
4.5'
3.3'
22.6
5.2'
.4'
1.9
2.7
14.1
3.5
1.8
n.a.
n.a.
-3.0
-9.3
-3.6'
-1.6'
-5.4'
-2.2'
-1.4'
6.5'
-2.3'
-6.6'
-1.7'
-23.6'
-.8
-6.6
19.1
-18.9
-18.2
12.0
-13.3
-14.8
10.0
-16.7'
-16.0
9.5
-17.2'
-23.6
13.4
-19.4'
-10.2
16.7
-16.8'
-16.7
14.7'
-IS.C
-25.4
10.3
-18.0
-9.4
10.2
-22.5
-36.5
22.4
-24.3
-29.7
18.8
-29.4
-36.7
8.4
-17.7'
-17.1
5.5
-17.2'
-5.2
9.2
-17.2'
-22.4
10.8
-3.5
8.8
-26.6'
-1.8'
10.1
-20.2
-24.7
-4.0
37.2
-.3
26.9
-4.0'
20.0
-8.2'
40.0
-12.2'
48.1
-6.8'
54.9
-17.2'
.0
10.1'
-64.1'
3.8
-12.3
11.5
1.5
10.0
2.5r
14.4'
2.5'
10.8'
10.0'
1.7'
9.7'
1.9
5.0
2.7'
-1.4
4.1
n.a.
n.a.
institutions2
Concepts of money, liquid assets, and debt4
Ml
M2
M3
L
Debt
Nontransaction
10 In M2'
11 In M3 only 6
Q4
components
Time and savings deposits
Commercial banks
Savings, including MMDAs
Small time
Large time •
Thrift institutions
15
Savings, including MMDAs
16 Small time
17
Large time •
12
13
14
Money market mutual funds
18 General purpose and broker-dealer
19 Institution-only
Debt components4
20 Federal
21 Nonfederal
1. Unless otherwise noted, rates of change are calculated from average
amounts outstanding during preceding month or quarter.
2. Figures incorporate adjustments for discontinuities, or "breaks," associated with regulatory changes in reserve requirements. (See also table 1.20.)
3. Seasonally adjusted, break-adjusted monetary base consists of (1) seasonally adjusted, break-adjusted total reserves (line 1), plus (2) the seasonally
adjusted currency component of the money stock, plus (3) (for all quarterly
reporters on the "Report of Transaction Accounts, Other Deposits, and Vault
Cash" and for all weekly reporters whose vault cash exceeds their required
reserves) the seasonally adjusted, break-adjusted difference between current vault
cash and the amount applied to satisfy current reserve requirements.
4. Composition of the money stock measures and debt is as follows:
Ml: (1) currency outside the Treasury, Federal Reserve Banks, and the vaults
of depository institutions; (2) travelers checks of nonbank issuers; (3) demand
deposits at all commercial banks other than those due to depository institutions,
the U.S. government, and foreign banks and official institutions, less cash items in
the process of collection and Federal Reserve float; and (4) other checkable
deposits (OCDs), consisting of negotiable order of withdrawal (NOW) and
automatic transfer service (ATS) accounts at depository institutions, credit union
share draft accounts, and demand deposits at thrift institutions. Seasonally
adjusted Ml is computed by summing currency, travelers checks, demand
deposits, and OCDs, each seasonally adjusted separately.
M2: Ml plus (1) overnight (and continuing-contract) repurchase agreements
(RPs) issued by all depository institutions and overnight Eurodollars issued to
U.S. residents by foreign branches of U.S. banks worldwide, (2) savings (including MMDAs) and small time deposits (time deposits—including retail repurchase
agreements (RPs)—in amounts of less than $100,000), and (3) balances in both
taxable and tax-exempt general-purpose and broker-dealer money market funds.
Excludes individual retirement accounts (IRAs) and Keogh balances at depository
institutions and money market funds. Also excludes all balances held by U.S.
commercial banks, money market funds (general purpose and broker-dealer),
foreign governments and commercial banks, and the U.S. government. Seasonally adjusted M2 is computed by adjusting its non-Mi component as a whole and
then adding this result to seasonally adjusted Ml.
M3: M2 plus (1) large time deposits and term RP liabilities (in amounts of
$100,000 or more) issued by all depository institutions, (2) term Eurodollars held
by U.S. residents at foreign branches of U.S. banks worldwide and at all banking
offices in the United Kingdom and Canada, and (3) balances in both taxable and
tax-exempt, institution-only money market funds. Excludes amounts held by
depository institutions, the U.S. government, money market funds, and foreign
banks and official institutions. Also excluded is the estimated amount of overnight
RPs and Eurodollars held by institution-only money market funds. Seasonally
adjusted M3 is computed by adjusting its non-M2 component as a whole and then
adding this result to seasonally adjusted M2.
L: M3 plus the nonbank public holdings of U.S. savings bonds, short-term
Treasury securities, commercial paper, and bankers acceptances, net of money
market fund holdings of these assets. Seasonally adjusted L is computed by
summing U.S. savings bonds, short-term Treasury securities, commercial paper,
and bankers acceptances, each seasonally adjusted separately, and then adding
this result to M3.
Debt: Debt of domestic nonfinancial sectors consists of outstanding creditmarket debt of the U.S. government, state and local governments, and private
nonfinancial sectors. Private debt consists of corporate bonds, mortgages, consumer credit (including bank loans), other bank loans, commercial paper, bankers
acceptances, and other debt instruments. Data are derived from the Federal
Reserve Board's flow of funds accounts. Data on debt of domestic nonfinancial
sectors are monthly averages, derived by averaging adjacent month-end levels.
Growth rates for debt reflect adjustments for discontinuities over time in the levels
of debt presented in other tables.
5. Sum of (1) overnight RPs and Eurodollars, (2) money market fund balances
(general purpose and broker-dealer), (3) MMDAs, and (4) savings and small time
deposits.
6. Sum of (1) large time deposits, (2) term RPs, (3) term Eurodollars of U.S.
residents, and (4) money market fund balances (institution-only), less (5) a
consolidation adjustment that represents the estimated amount of overnight RPs
and Eurodollars held by institution-only money market funds. This sum is
seasonally adjusted as a whole.
7. Small time deposits—including retail RPs—are those issued in amounts of
less than $100,000. All IRA and Keogh account balances at commercial banks and
thrift institutions are subtracted from small time deposits.
8. Large time deposits are those issued in amounts of $100,000 or more,
excluding those booked at international banking facilities.
9. Large time deposits at commercial banks less those held by money market
funds, depository institutions, and foreign banks and official institutions.
Money Stock and Bank Credit
1.11
A5
R E S E R V E S OF DEPOSITORY INSTITUTIONS A N D R E S E R V E B A N K CREDIT 1
Millions of dollars
Sept.
Average of
daily figures
Average of daily figures for week ending on date indicated
1992
1992
Oct.
Nov.
Oct. 14
Oct. 21
Oct. 28
Nov. 4
Nov. 11
Nov. 18
Nov. 25
SUPPLYING RESERVE FUNDS
1 Reserve Bank credit outstanding
U.S. government securities
2
Bought outright—System account
3
Held under repurchase agreements . . .
Federal agency obligations
4
Bought outright
5
Held under repurchase agreements . . .
6
Acceptances
Loans to depository institutions
7
Adjustment credit
8
Seasonal credit
9
Extended credit
10
Float
11
Other Federal Reserve assets
12 Gold stock
13 Special drawing rights certificate account .
14 Treasury currency outstanding
325,915
321,292 r
327,922
323,092
321,295
320,855
323,446
326,698
327,866
329,972
280,746
6,452
282,073
858
288,434
2,640
282,037
1,924
282,160
361
281,906
1,147
285,693
0
285,068
4,306
286,364
4,402
291,828
2,092
5,538
293
0
5,534
69
0
5,534
145
0
5,534
153
0
5,534
29
0
5,534
78
0
5,534
0
0
5,534
288
0
5,534
177
0
5,534
122
0
94
192
0
541
32,059
29
115
0
572
32,041
81
39
0
574
30,475
58
127
0
994
32,265
9
103
0
948
32,152
37
86
0
2
32,066
21
63
0
935
31,200
5
43
0
295
31,160
49
39
0
624
30,677
153
34
0
333
29,876
11,059
10,018
21,324
11,059
10,018
21,380
11,059
10,018
21,441
11,060
10,018
21,370
11,059
10,018
21,384
11,059
10,018
21,398
11,060
10,018
21,412
11,059
10,018
21,426
11,059
10,018
21,440
11,059
10,018
21,454
318,628
530
320,241
518
324,550
504
321,085
525
321,007
516
319,968
509
320,860
505
323,149
501
324,972
500
325,634
495
11,390
309
4,946
330
5,617
284
4,555
293
4,675
271
5,191
402
5,622
457
5,250
382
5,184
247
5,787
199
5,773
290
5,782
286
5,898
293
5,703
276
5,742
269
5,832
265
6,039
304
5,729
294
6,006
301
5,756
284
ABSORBING RESERVE FUNDS
15 Currency in circulation
16 Treasury cash holdings
Deposits, other than reserve balances, with
Federal Reserve Banks
17
Treasury
18
Foreign
19
Service-related balances and
adjustments
20
Other
21 Other Federal Reserve liabilities and
capital
22 Reserve balances with Federal
Reserve Banks
8,507
8,108
7,834
8,180
8,132
8,242
7,435
7,533
7,887
8,177
22,890
23,540 r
25,460
24,922
23,145
22,921
24,714
26,364
25,286
26,169
End-of-month figures
Sept.
Oct.
Wednesday figures
Nov.
Oct. 14
Oct. 21
Oct. 28
Nov. 4
Nov. 11
Nov. 18
Nov. 25
SUPPLYING RESERVE FUNDS
1 Reserve Bank credit outstanding
U.S. government securities
2
Bought outright—System account
3
Held under repurchase agreements . . .
Federal agency obligations
4
Bought outright
5
Held under repurchase agreements . . .
6
Acceptances
Loans to depository institutions
7
Adjustment credit
8
Seasonal credit
9
Extended credit
10
Float
11
Other Federal Reserve assets
336,583
320,055r
331,111
332,569
319,138
318,942
326,097
328,452
321,990
329,480
279,712
16,685
282,877
0
292,696
3,256
281,313
9,831
281,314
0
282,004
521
288,095
0
285,564
4,688
286,719
150
292,340
343
5,534
1,475
0
5,534
0
0
5,534
254
0
5,534
1,044
0
5,534
0
0
5,534
130
0
5,534
0
0
5,534
533
0
5,534
0
0
5,534
0
0
425
184
0
-227
32,796
11
70
0
500r
31,064 r
10
25
0
-24
29,360
190
119
0
1,485
33,054
20
%
0
335
31,838
28
75
0
-1,505
32,155
7
48
0
1,108
31,307
6
41
0
605
31,482
155
39
0
100
29,293
834
30
0
707
29,692
12 Gold stock
13 Special drawing rights certificate account .
14 Treasury currency outstanding
11,058
10,018
21,342
11,060
10,018
21,412
11,059
10,018
21,468
11,059
10,018
21,370
11,059
10,018
21,384
11,059
10,018
21,398
11,059
10,018
21,412
11,060
10,018
21,426
11,059
10,018
21,440
11,059
10,018
21,454
317,923
527
320,398
505
327,315
525
321,611
517
320,503
510
320,237
505
321,861
501
324,384
501
325,155
490
327,020
525
24,586
546
4,413
415
6,985
229
4,342
279
5,692
393
5,028
585
6,940
542
5,388
264
6,504
162
6,074
185
5,963
296
6,039"^
317
6,066
296
5,703
300
5,742
254
5,832
298
6,039
280
5,729
304
6,006
288
5,756
278
ABSORBING RESERVE FUNDS
15 Currency in circulation
16 Treasury cash holdings
Deposits, other than reserve balances, with
Federal Reserve Banks
17
Treasury
18
Foreign
19
Service-related balances and
adjustments
20
Other
21 Other Federal Reserve liabilities and
capital
22 Reserve balances with Federal
Reserve Banks'
8,024
7,271
7,759
8,097
7,916
8,081
7,329
7,645
7,903
8,088
21,138
23,186 r
24,479
34,168
20,590
20,851
25,094
26,738
17,998
24,084
1. For amounts of cash held as reserves, see table 1.12.
2. Includes securities loaned—fully guaranteed by U.S. government securities
pledged with Federal Reserve Banks—and excludes any securities sold and
scheduled to be bought back under matched sale-purchase transactions.
3. Excludes required clearing balances and adjustments to compensate for
float,
A6
Domestic Financial Statistics • February 1993
1.12
R E S E R V E S A N D BORROWINGS
Depository Institutions 1
Millions of dollars
Prorated monthly averages of biweekly averages
Reserve classification
1
2
3
4
5
6
7
8
9
10
Reserve balances with Reserve Banks
Total vault cash
Applied vault cash ,
Surplus vault cash
Total reserves 6
Required reserves
1...
Excess reserve balances at Reserve Banks . . .
Total borrowings at Reserve Banks 8
Seasonal borrowings
Extended credit
1989
1990
1991
Dec.
Dec.
Dec.
May
June
July
Aug.
Sept.
Oct. r
Nov.
35,436
29,828
27,374
2,454
62,810
61,887
923
265
84
20
30,237
31,786
28,884
2,903
59,120
57,456
1,664
326
76
23
26,659
32,513
28,872
3,641
55,532
54,553
979
192
38
1
21,071
31,197
27,754
3,442
48,825
47,825
1,000
155
98
0
21,223
31,729
28,273
3,456
49,4%
48,584
913
229
149
0
21,206
32,145
28,617
3,528
49,823
48,857
965
284
203
0
21,272
32,457
28,890
3,567
50,162
49,227
935
251
223
0
22,627
32,343
28,894
3,448
51,521
50,527
994
287
193
0
23,626
32,991
29,510
3,481
53,136
52,062
1,074
143
114
0
25,459
32,626
29,205
3,422
54,664
53,620
1,043
104
40
0
1992
Biweekly averages of daily figures for weeks ending
1992
1
2
3
4
5
6
7
8
9
10
Reserve balances with Reserve Banks 2
Total vault cash 3
Applied vault cash ,
Surplus vault cash
Total reserves 6
Required reserves
Excess reserve balances at Reserve Banks . . .
Total borrowings at Reserve Banks
Seasonal borrowings
Extended credit 9
Aug. 5
Aug. 19
Sept. 2
Sept. 16
Sept. 30
Oct. 14
Oct. 28
Nov. l l r
Nov. 25
Dec. 9
21,264
31,613
28,105
3,508
49,369
48,447
922
241
222
0
21,515
32,687
29,166
3,521
50,681
49,856
825
249
221
0
20,991
32,541
28,896
3,645
49,887
48,820
1,067
258
226
0
23,439
31,625
28,438
3,187
51,876
51,081
795
321
187
0
22,048
33,033
29,351
3,682
51,399
50,217
1,182
259
196
0
23,810
32,929
29,438
3,491
53,248
52,099
1,149
185
146
0
23,031
33,333r
29,790
3,543r
52,821
51,750
1,071
118
95
0
25,535
31,688
28,539
3,150
54,074
53,346
728
66
53
0
25,730
33,446
29,117
4,329
54,846
53,485
1,361
138
37
0
24,533
32,397
30,917
1,480
55,450
54,604
845
95
22
0
1. Data in this table also appear in the Board's H.3 (502) weekly statistical
release. For ordering address, see inside front cover.
2. Excludes required clearing balances and adjustments to compensate for float
and includes other off-balance-sheet " a s - o f ' adjustments.
3. Total "lagged" vault cash held by depository institutions subject to reserve
requirements. Dates refer to the maintenance periods during which the vault cash
can be used to satisfy reserve requirements. Under contemporaneous reserve
requirements, maintenance periods end thirty days after the lagged computation
periods during which the balances are held.
4. All vault cash held during the lagged computation period by "bound"
institutions (that is, those whose required reserves exceed their vault cash) plus
the amount of vault cash applied during the maintenance period by "nonbound"
institutions (that is, those whose vault cash exceeds their required reserves) to
satisfy current reserve requirements.
5. Total vault cash (line 2) less applied vault cash (line 3).
6. Reserve balances with Federal Reserve Banks (line 1) plus applied vault cash
(line 3).
7. Total reserves (line 5) less required reserves (line 6).
8. Also includes adjustment credit.
9. Consists of borrowing at the discount window under the terms and conditions established for the extended credit program to help depository institutions
deal with sustained liquidity pressures. Because there is not the same need to
repay such borrowing promptly as there is with traditional short-term adjustment
credit, the money market impact of extended credit is similar to that of
nonborrowed reserves.
Money Stock and Bank Credit
1.13
S E L E C T E D BORROWINGS IN IMMEDIATELY A V A I L A B L E F U N D S
Al
Large Banks 1
Millions of dollars, averages of daily figures
1992, week ending Monday
Source and maturity
1
2
3
4
5
6
7
8
Federal funds purchased, repurchase agreements, and
other selected borrowings
From commercial banks in the United States
For one day or under continuing contract
For all other maturities
From other depository institutions, foreign banks and
official institutions, and U.S. government agencies
For one day or under continuing contract
For all other maturities
Repurchase agreements on U.S. government and federal
agency securities
Brokers and nonbank dealers in securities
For one day or under continuing contract
For all other maturities
All other customers
For one day or under continuing contract
For all other maturities
Aug. 31
Sept. 7
Sept. 14
Sept. 21
Sept. 28
Oct. 5
Oct. 12
Oct. 19
Oct. 26
69,674
15,512
77,011
14,365
74,385
14,605
69,601r
13,869
64,186r
13,912r
76,088
13,207
73,095
14,234
74,222
14,254
67,637
14,797
17,874
19,493
19,902
20,735
17,075
21,184
16, n o 1
20,791
18,852r
21,305
17,985
19,541
16,750
18,368
22,663
17,428
23,327
18,688
15,305
16,977
14,459
15,956
14,299
17,202
12,182r
16,960
11,499"
17,490
11,433
17,827
11,333
18,663
14,483
18,780
13,088
20,594
r
r
25,113
12,483
25,117
12,542
23,355
12,198
23,515
12,972r
23,437
13,256r
25,848
12,250
24,517
12,631
23,481
12,159
23,164
12,719
41,511
17,663
42,828
19,705
41,225
20,430
44,476r
22,495r
40,128r
21,141r
47,192
26,564
40,377
22,468
41,392
19,175
37,812
20,103
MEMO
Federal funds loans and resale agreements in
immediately available funds in maturities of one day or
under continuing contract
9 To commercial banks in the United States
10 To all other specified customers 2
1. Banks with assets of $4 billion or more as of Dec. 31, 1988.
Data in this table also appear in the Board's H.S (507) weekly statistical release.
For ordering address, see inside front cover.
2. Brokers and nonbank dealers in securities, other depository institutions,
foreign banks and official institutions, and U.S. government agencies.
A8
1.14
Domestic Financial Statistics • February 1993
F E D E R A L R E S E R V E B A N K INTEREST RATES
Percent per year
Current and previous levels
Adjustment credit 1
Federal Reserve
Bank
On
. 12/31/92
Boston
New York
Philadelphia , ,
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco . . .
Seasonal credit 2
Effective date
Previous rate
On
12/31/92
7/2/92
7/2/92
7/2/92
7/6/92
7/2/92
7/2/92
3.5
3.20
3
7/2/92
7/7/92
7/2/92
7/2/92
7/2/92
7/2/92
3
3.5
3.20
Extended credit 3
Effective date
Previous rate
On
12/31/92
12/24/92
12/24/92
12/24/92
12/24/92
12/24/92
12/24/92
3.40
3.70
12/24/92
12/24/92
12/24/92
12/24/92
12/24/92
12/24/92
3.40
Range of rates for adjustment credit in recent years
Effective date
In effect Dec. 31, 1977
1978—Jan.
May
July
Aug.
Sept.
Oct.
Nov.
9
20
11
12
3
10
21
22
16
20
1
3
Range (or
level)—
All F.R.
Banks
6
6-6.5
6.5
6.5-7
7
7-7.25
7.25
7.75
8
8-8.5
8.5
8.5-9.5
9.5
1979—July 20
Aug. 17
20
Sept. 19
21
Oct. 8
10
10
10-10.5
10.5
10.5-11
11
11-12
12
1980—Feb. 15
19
May 29
30
June 13
16
29
July 28
Sept. 26
Nov. 17
Dec. 5
12-13
13
12-13
12
11-12
11
10
10-11
11
12
12-13
F.R.
Bank
of
N.Y.
6
6.5
6.5
7
7
7.25
7.25
7.75
8
8.5
8.5
9.5
9.5
10
10.5
10.5
11
U
12
12
13
13
13
12
11
11
10
10
11
12
13
Effective
1981-- M a y
Nov.
Dec.
5
?
6
4
13-14
14
13-14
13
12
F.R.
Bank
of
N.Y.
14
14
13
13
12
70
73
7
3
16
77
30
Oct. 1?
n
Nov. 2?
76
Dec. 14
15
17
11.5-12
11.5
11-11.5
11
10.5
10-10.5
10
9.5-10
9.5
9-9.5
9
8.5-9
8.5-9
8.5
11.5
11.5
11
11
10.5
10
10
9.5
9.5
9
9
9
8.5
8.5
9
n
Nov. 71
76
Dec. 74
8.5-9
9
8.5-9
8.5
8
9
9
8.5
8.5
8
1985-—May
—May 70
74
7.5-8
7.5
7.5
7.5
1986-—Mar. 7
10
Apr. 71
July 11
7-7.5
7
6.5-7
6
7
7
6.5
6
-July
1982--July
Aug.
1984-—Apr.
—Apr.
Previous rate
12/24/92
12/24/92
12/24/92
12/24/92
12/24/92
12/24/92
3.90
3.70
12/24/92
12/24/92
12/24/92
12/24/92
12/24/92
12/24/92
3.90
4
Range (or
level)—
All F.R.
Banks
F.R.
Bank
of
N.Y.
1986—Aug. 21
22
5.5-6
5.5
5.5
5.5
1987—Sept. 4
11
5.5-6
6
6
6
1988—Aug. 9
11
6-6.5
6.5
1989—Feb. 24
27
6.5-7
7
7
7
Effective date
1990—Dec. 19
1991—Feb.
Apr.
May
Sept.
Sept.
Nov.
Dec.
1992—July
6.5
6.5
1
4
30
2
13
17
6
7
20
24
6.65
6
5.5-6
5.5
5-5.5
5
4.5-5
4.5
3.5-4.5
3.5
6
6
5.5
5.5
5
5
4.5
4.5
3.5
3.5
2
7
3-3.5
3
3
3
3
3
In effect Dec. 31, 1992
1. Available on a short-term basis to help depository institutions meet temporary needs for funds that cannot be met through reasonable alternative sources.
The highest rate established for loans to depository institutions may be charged on
adjustment-credit loans of unusual size that result from a major operating problem
at the borrower's facility.
2. Available to help relatively small depository institutions meet regular
seasonal needs for funds that arise from a clear pattern of intrayearly movements
in their deposits and loans and that cannot be met through special industry
lenders. The discount rate on seasonal credit takes into account rates on market
sources of funds and ordinarily is reestablished on the first business day of each
two-week reserve maintenance period; however, it is never less than the discount
rate applicable to adjustment credit.
3. May be made available to depository institutions when similar assistance is
not reasonably available from other sources, including special industry lenders.
Such credit may be provided when exceptional circumstances (including sustained deposit drains, impaired access to money market funds, or sudden
deterioration in loan repayment performance) or practices involve only a particular institution, or to meet the needs of institutions experiencing difficulties
adjusting to changing market conditions over a longer period (particularly at times
of deposit disintermediation). The discount rate applicable to adjustment credit
Range (or
level)—
All F.R.
Banks
Effective date
ordinarily is charged on extended-credit loans outstanding less than thirty days;
however, at the discretion of the Federal Reserve Bank, this time period may be
shortened. Beyond this initial period, a flexible rate somewhat above rates on
market sources of funds is charged. The rate ordinarily is reestablished on the first
business day of each two-week reserve maintenance period, but it is never less
than the discount rate applicable to adjustment credit plus 50 basis points.
4. For earlier data, see the following publications of the Board of Governors:
Banking and Monetary Statistics, 1914-1941, and 1941-1970; and the Annual
Statistical Digest, 1970-1979.
In 1980 and 1981, the Federal Reserve applied a surcharge to short-term
adjustment-credit borrowings by institutions with deposits of $500 million or more
that had borrowed in successive weeks or in more than four weeks in a calendar
quarter. A 3 percent surcharge was in effect from Mar. 17, 1980, through May 7,
1980. A surcharge of 2 percent was reimposed on Nov. 17, 1980; the surcharge
was subsequendy raised to 3 percent on Dec. 5, 1980, and to 4 percent on May 5,
1981. The surcharge was reduced to 3 percent effective Sept. 22, 1981, and to 2
percent effective Oct. 12, 1981. As of Oct. 1, 1981, the formula for applying the
surcharge was changed from a calendar quarter to a moving thirteen-week period.
The surcharge was eliminated on Nov. 17, 1981.
Policy Instruments
1.15
A9
RESERVE REQUIREMENTS OF DEPOSITORY INSTITUTIONS 1
Type of deposit 2
Net transaction accounts
1 $0 million-$46.8 million...
2 More than $46.8 million . .
12/15/92
12/15/92
3
Nonpersonal time deposits
;
12/27/90
4
Eurocurrency liabilities6 ..
12/27/90
1. Required reserves must be held in the form of deposits with Federal Reserve
Banks or vault cash. Nonmember institutions may maintain reserve balances with
a Federal Reserve Bank indirectly on a pass-through basis with certain approved
institutions. For previous reserve requirements, see earlier editions of the Annual
Report or the Federal Reserve Bulletin. Under provisions of the Monetary
Control Act, depository institutions include commercial banks, mutual savings
banks, savings and loan associations, credit unions, agencies and branches of
foreign banks, and Edge corporations.
2. The Garn-St Germain Depository Institutions Act of 1982 (Public Law
97-320) requires that $2 million of reservable liabilities of each depository
institution be subject to a zero percent reserve requirement. The Board is to adjust
the amount of reservable liabilities subject to this zero percent reserve requirement each year for the succeeding calendar year by 80 percent of the percentage
increase in the total reservable liabilities of all depository institutions, measured
on an annual basis as of June 30. No corresponding adjustment is to be made in
the event of a decrease. On Dec. 15, 1992, the exemption was raised from $3.6
million to $3.8 million. The exemption applies in the following order: (1) net
negotiable order of withdrawal (NOW) accounts (NOW accounts less allowable
deductions); and (2) net other transaction accounts. The exemption applies only to
accounts that would be subject to a 3 percent reserve requirement.
3. Include all deposits against which the account holder is permitted to make
withdrawals by negotiable or transferable instruments, payment orders of withdrawal, and telephone and preauthorized transfers in excess of three per month
for the purpose of making payments to third persons or others. However, money
market deposit accounts (MMDAs) and similar accounts subject to the rules that
permit no more than six preauthorized, automatic, or other transfers per month,
of which no more than three may be checks, are not transaction accounts (such
accounts are savings deposits).
The Monetary Control Act of 1980 requires that the amount of transaction
accounts against which the 3 percent reserve requirement applies be modified
annually by 80 percent of the percentage change in transaction accounts held by
all depository institutions, determined as of June 30 each year. Effective Dec. 15,
1992, for institutions reporting quarterly, and Dec. 24, 1992, for institutions
reporting weekly, the amount was increased from $42.2 million to $46.8 million.
4. The reserve requirement was reduced from 12 percent to 10 percent on Apr.
2, 1992, for institutions that report weekly, and on Apr. 16, 1992, for institutions
that report quarterly.
5. For institutions that report weekly, the reserve requirement on nonpersonal
time deposits with an original maturity of less than lVz years was reduced from 3
percent to IVi percent for the maintenance period that began Dec. 13, 1990, and
to zero for the maintenance period that began Dec. 27, 1990. The reserve
requirement on nonpersonal time deposits with an original maturity of 1 Vi years
or more has been zero since Oct. 6, 1983.
For institutions that report quarterly, the reserve requirement on nonpersonal
time deposits with an original maturity of less than 1 Vi years was reduced from 3
percent to zero on Jan. 17, 1991.
6. The reserve requirement on Eurocurrency liabilities was reduced from 3
percent to zero in the same manner and on the same dates as were the reserve
requirement on nonpersonal time deposits with an original maturity of less than
1 Vi years (see note 4).
A10
1.17
Domestic Financial Statistics • February 1993
F E D E R A L R E S E R V E OPEN MARKET TRANSACTIONS 1
Millions of dollars
1992
Type of transaction
1989
1990
1991
Apr.
May
June
July
Aug.
Sept.
Oct.
U . S . TREASURY SECURITIES
Outright transactions (excluding
transactions)
1
2
3
4
matched
Treasury bills
Gross purchases
Gross sales
Exchanges
Redemptions
14,284
12,818
231,211
12,730
24,739
7,291
241,086
4,400
20,158
120
277,314
1,000
0
0
27,526
0
4,110
0
24,275
0
306
0
22,392
0
0
0
27,755
0
271
0
25,041
0
595
0
22,268
0
4,072
0
28,907
0
327
0
28,848
-25,783
500
425
0
25,638
-27,424
0
3,043
0
24,454
-28,090
1,000
0
0
1,100
-1,863
0
0
0
3,754
-5,225
0
0
0
2,152
-1,854
0
0
0
687
-1,669
0
0
0
5,415
-4,617
0
550
0
0
0
0
0
0
0
0
0
One to five years
Gross purchases
Gross sales
Maturity shifts
Exchanges
1,436
490
-25,534
23,250
250
200
-21,770
25,410
6,583
0
-21,211
24,594
0
0
-877
1,484
200
0
-2,113
4,311
2,278
0
-3,447
1,854
0
0
-216
1,478
400
0
-4,036
3,567
3,325
0
0
0
200
0
0
0
Five to ten years
Gross purchases
Gross sales
16 Maturity shifts
IV
Exchanges
287
29
-2,231
1,934
0
100
-2,186
789
1,280
0
-2,037
2,894
0
0
-223
379
0
0
-346
614
597
0
0
0
0
0
-471
191
0
0
-412
700
725
0
0
0
0
0
0
0
284
0
-1,086
600
0
0
-1,681
1,226
375
0
-1,209
600
0
0
0
0
0
0
0
300
655
0
0
0
0
0
0
0
195
0
0
350
731
0
0
0
0
0
0
0
16,617
13,337
13,230
25,414
7,591
4,400
31,439
120
1,000
0
0
0
4,310
0
0
3,836
0
0
0
0
0
866
0
0
5,927
0
0
4,272
0
0
1,323,480
1,326,542
1,369,052
1,363,434
1,570,456
1,571,534
125,999
128,149
118,972
117,524
126,977
129,216
127,051
126,137
104,873
102,575
116,331
115,579
116,024
114,917
129,518
132,688
219,632
202,551
310,084
311,752
18,432
20,237
38,777
38,533
10,792
11,036
12,224
12,224
39,484
31,868
68,697
59,628
18,698
35,383
-10,055
24,886
29,729
345
3,107
5,831
-914
6,184
14,244
-13,520
0
0
442
0
0
183
0
5
292
0
0
49
0
0
160
0
0
40
0
0
85
0
0
54
0
0
37
0
0
0
Repurchase
agreements2
33 Gross purchases
34 Gross sales
38,835
40,411
41,836
40,461
22,807
23,595
224
224
1,281
1,281
402
402
94
94
601
548
3,222
1,800
1,778
3,253
35 Net change in federal agency obligations
-2,018
1,192
-1,085
-49
-160
-40
-85
-1
1,385
-1,475
36 Total net change in System Open Market
Account
-12,073
26,078
28,644
295
2,946
5,791
-1,000
6,183
15,629
-14,995
Others within one year
Gross purchases
Gross sales
'/
Maturity shifts
8
Exchanges
y
Redemptions
5
6
10
n
12
13
14
IS
18
19
20
21
More than ten years
Gross purchases
Gross sales
Maturity shifts
Exchanges
All maturities
Gross purchases
Gross sales
24
Redemptions
22
23
Matched transactions
Gross sales
26 Gross purchases
25
2
Repurchase
agreements
21 Gross purchases
28 Gross sales
29 Net change in U.S. government securities
F E D E R A L A G E N C Y OBLIGATIONS
Outright transactions
30 Gross purchases
31 Gross sales
32 Redemptions
1. Sales, redemptions, and negative figures reduce holdings of the System Open
Market Account; all other figures increase such holdings.
2. In July 1984 the Open Market Trading Desk discontinued accepting bankers
acceptances in repurchase agreements.
Federal Reserve Banks
1.18
FEDERAL RESERVE BANKS
A11
Condition and Federal Reserve Note Statements 1
Millions of dollars
Account
Oct. 28
Nov. 4
Wednesday
End of month
1992
1992
Nov. 11
Nov. 18
Nov. 25
Sept. 30
Oct. 31
Nov. 30
Consolidated condition statement
ASSETS
1 Gold certificate account
2 Special drawing rights certificate account
3 Coin
Loans
4 To depository institutions
5 Other
6 Acceptances held under repurchase agreements
Federal agency obligations
7 Bought outright
8 Held under repurchase agreements
11,059
10,018
517
11,059
10,018
515
11,060
10,018
511
11,059
10,018
517
11,059
10,018
495
11,058
10,018
501
11,060
10,018
519
11,059
10,018
491
103
0
0
54
0
0
46
0
0
194
0
0
865
0
0
609
0
0
80
0
0
35
0
0
5,534
130
5,534
0
5,534
533
5,534
0
5,534
0
5,534
1,475
5,534
0
5,534
254
282,525
288,095
290,252
286,869
292,683
296,397
282,877
295,952
10 Bought outright 2
11
Bills
12
Notes
13 Bonds
14 Held under repurchase agreements
282,004
135,843
112,576
33,584
521
288,095
141,935
112,576
33,584
0
285,564
139,154
112,826
33,584
4,688
286,719
139,709
113,026
33,984
150
292,340
139,423
117,879
35,037
343
279,712
133,752
112,376
33,584
16,685
282,877
136,716
112,576
33,584
0
292,696
139,780
117,879
35,037
3,256
15 Total loans and securities
288,292
293,683
296,365
292,597
299,081
304,015
288,491
301,775
4,791
1,025
6,852
1,024
7,485
1,026
5,741
1,028
6,198
1,029
5,125
1,019
5,136
1,024
1,912
1,029
24,065
6,949
23,078
7,288
23,109
7,464
23,133
5,235
22,739
6,063
24,432
7,423
23,067
7,020
22,150
6,245
346,715
353,517
357,039
349,328
356,682
363,591
346,334
354,679
9 Total U.S. Treasury securities
16 Items in process of collection
17 Bank premises
Other assets
18 Denominated in foreign currencies
19 All other 4
20 Total assets
LIABILITIES
21 Federal Reserve notes
299,861
301,466
303,970
304,722
306,586
297,609
300,010
306,863
22 Total deposits
34,084
38,839
38,591
31,267
36,746
53,094
34,484
37,840
23
24
25
26
28,161
5,028
585
298
31,077
6,940
542
280
32,634
5,388
264
304
24,312
6,504
162
288
30,208
6,074
185
278
27,665
24,586
546
296
29,339
4,413
415
317
30,348
6,985
229
2%
4,689
1,752
5,883
1,763
6,832
1,788
5,436
1,776
5,263
1,860
4,865
1,840
4,568
1,805
2,216
1,894
340,386
347,950
351,182
343,201
350,455
357,408
340,868
348,814
3,006
2,652
671
3,040
2,500
26
3,021
2,586
250
3,022
2,626
478
3,028
2,629
571
2,977
2,652
555
3,040
2,419
8
3,028
2,546
291
346,715
353,517
357,039
349,328
356,682
363,591
346,334
354,679
284,546
292,965
297,628
292,312
285,278
283,556
293,014
285,765
Depository institutions
U.S. Treasury—General account
Foreign—Official accounts
Other
27 Deferred credit items
28 Other liabilities and accrued dividends
29 Total liabilities
CAPITAL ACCOUNTS
30 Capital paid in
31 Surplus
32 Other capital accounts
33 Total liabilities and capital accounts
MEMO
34 Marketable U.S. Treasury securities held in custody
for foreign and international accounts
Federal Reserve note statement
35 Federal Reserve notes outstanding (issued to Bank)
36
LESS: Held by Federal Reserve Bank
37
Federal Reserve notes, net
38
39
40
41
Collateral held against notes, net:
Gold certificate account
Special drawing rights certificate account
Other eligible assets
U.S. Treasury and agency securities
42 Total collateral
357,787
57,926
299,861
357,439
55,974
301,466
357,775
53,805
303,970
358,494
53,772
304,722
359,211
52,626
306,586
357,496
59,887
297,609
357,540
57,530
300,010
359,274
52,410
306,863
11,059
10,018
0
278,784
11,059
10,018
0
280,389
11,060
10,018
0
282,893
11,059
10,018
0
283,645
11,059
10,018
0
285,509
11,058
10,018
0
276,532
11,060
10,018
0
278,933
11,059
10,018
0
285,787
299,861
301,466
303,970
304,722
306,586
297,609
300,010
306,863
1. Some of the data in this table also appear in the Board's H.4.1 (503) weekly
statistical release. For ordering address, see inside front cover.
2. Includes securities loaned—fully guaranteed by U.S. Treasury securities
pledged with Federal Reserve Banks—and excludes securities sold and scheduled
to be bought back under matched sale-purchase transactions.
3. Valued monthly at market exchange rates.
4. Includes special investment account at the Federal Reserve Bank of Chicago
in Treasury bills maturing within ninety days.
5. Includes exchange-translation account reflecting the monthly revaluation at
market exchange rates of foreign-exchange commitments.
A12
1.19
Domestic Financial Statistics • February 1993
FEDERAL RESERVE BANKS
Maturity Distribution of Loan and Security Holding
1
Millions of dollars
Type and maturity grouping
Wednesday
End of month
1992
1992
Oct. 28
Nov. 4
Nov. 11
Nov. 18
Nov. 25
Sept. 30
Oct. 30
Nov. 30
103
54
46
194
865
609
80
35
87
16
0
17
38
0
19
28
0
194
1
0
864
1
0
506
103
0
35
46
0
23
12
0
5 Total acceptances
0
0
0
0
0
0
0
0
6
7
8
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1 Total loans
2
3
4
Within fifteen days
Sixteen days to ninety days
Ninety-one days to one year
Within fifteen days
Sixteen days to ninety days
Ninety-one days to one year
282,525
288,095
290,252
286,869
292,683
296,397
282,877r
295,952
Within fifteen days 2
Sixteen days to ninety days
Ninety-one days to one year
One year to five years
Five years to ten years
More than ten years
11,667
67,250
90,336
69,627
17,014
26,631
20,224
61,392
93,864
68,970
17,014
26,631
16,936
66,809
93,643
69,220
17,014
26,631
14,311
69,135
91,877
67,062
17,627
26,858
10,493
69,694
95,504
70,383
18,803
27,805
24,468
67,062
91,423
69,648
17,165
26,631
3,203r
73,197r
93,205r
69,627r
17,014
26,631
8,620
75,398
95,569
69,757
18,803
27,805
16 Total federal agency obligations
5,664
5,534
6,067
5,534
5,534
7,009
5,534
5,788
Within fifteen days 2
Sixteen days to ninety days
Ninety-one days to one year
One year to five years
Five years to ten years
More than ten years
244
843
1,198
2,503
722
154
0
951
1,204
2,503
722
154
653
831
1,204
2,503
722
154
458
568
1,129
2,503
722
154
393
513
1,129
2,622
723
154
1,685
747
1,221
2,465
737
154
114
843
1,198
2,503
722
154
647
548
1,109
2,608
722
154
9 Total U.S. Treasury securities
10
11
12
13
14
15
17
18
19
20
21
22
1. Holdings under repurchase agreements are classified as maturing within
fifteen days in accordance with maximum maturity of the agreements.
Monetary and Credit Aggregates
1.20
A13
AGGREGATE R E S E R V E S OF DEPOSITORY INSTITUTIONS A N D M O N E T A R Y B A S E 1
Billions of dollars, averages of daily figures
1992
Item
1988
Dec.
1989
Dec.
1990
Dec.
1991
Dec.
Apr.
Total reserves 3
Nonborrowed reserves
Nonborrowed reserves plus extended credit
Required reserves
Monetary base
June
July
Aug.
Sept.
Oct.
Nov.
49.49
49.21
49.21
48.52
332.26
50.32
50.07
50.07
49.39
336.87
51.35
53.14
51.06
53.00
51.06 53.00
50.35
52.07
341.55 345.61r
54.07
53.96
53.96
53.02
348.11
Seasonally adjusted
ADJUSTED FOR
CHANGES IN RESERVE REQUIREMENTS 2
1
2
3
4
5
May
40.47
38.75
40.00
39.42
256.97
40.56
40.29
40.31
39.64
267.77
41.83
41.51
41.53
40.17
293.29
45.60
45.41
45.41
44.62
317.25
49.00
48.91
48.91
47.86
326.50
49.49
49.34
49.34
48.49
328.58
49.23
49.01
49.01
48.32
329.64
Not seasonally adjusted
6
7
8
9
10
Total reserves
Nonborrowed reserves
Nonborrowed reserves plus extended credit
Required reserves
Monetary base
41.65
39.93
41.17
40.60
260.41
41.77
41.51
41.53
40.85
271.18
43.07
42.74
42.77
41.40
296.68
46.98
46.78
46.78
46.00
321.07
50.02
49.93
49.93
48.88
327.45
48.62
48.47
48.47
47.62
328.37
49.25
49.02
49.02
48.33
330.94
49.52
49.24
49.24
48.56
334.09
49.81
49.56
49.56
48.88
336.59
51.11
52.66
50.83
52.52
52.52
50.83
50.12
51.59
340.11 343.66r
54.13
54.03
54.03
53.09
347.93
63.75
62.03
63.28
62.70
283.00
1.05
1.72
62.81
62.54
62.56
61.89
292.55
.92
.27
59.12
58.80
58.82
57.46
313.70
1.66
.33
55.53
55.34
55.34
54.55
333.61
.98
.19
50.46
50.37
50.37
49.32
332.69
1.14
.09
48.83
48.67
48.67
47.83
333.79
49.50
49.27
49.27
48.58
336.43
.91
.23
49.82
49.54
49.54
48.86
339.87
.97
.28
50.16
49.91
49.91
49.23
342.49
.94
.25
51.52 53.14
51.23
52.99
51.23
52.99
50.53
52.06
346.21 349.81r
.99
1.07
.29
.14
54.66
54.56
54.56
53.62
354.26
1.04
.10
N O T ADJUSTED FOR
CHANGES IN RESERVE REQUIREMENTS
11
12
13
14
15
16
17
Total reserves 11
Nonborrowed reserves
^
Nonborrowed reserves plus extended credit
Required reserves
Monetary base
Excess reserves
Borrowings from the Federal Reserve
1. Latest monthly and biweekly figures are available from the Board's H.3 (502)
weekly statistical release. Historical data and estimates of the impact on required
reserves of changes in reserve requirements are available from the Monetaiy and
Reserves Projections Section, Division of Monetary Affairs, Board of Governors
of the Federal Reserve System, Washington, DC 20551.
2. Figures reflect adjustments for discontinuities, or "breaks," associated with
regulatory changes in reserve requirements. (See also table 1.10)
3. Seasonally adjusted, break-adjusted total reserves equal seasonally
adjusted, break-adjusted required reserves (line 4) plus excess reserves (line 16).
4. Seasonally adjusted, break-adjusted nonborrowed reserves equal seasonally
adjusted, break-adjusted total reserves (line 1) less total borrowings of depository
institutions from the Federal Reserve (line 17).
5. Extended credit consists of borrowing at the discount window under
the terms and conditions established for the extended credit program to help
depository institutions deal with sustained liquidity pressures. Because there is
not the same need to repay such borrowing promptly as there is with traditional
short-term adjustment credit, the money market impact of extended credit is
similar to that of nonborrowed reserves.
6. The seasonally adjusted, break-adjusted monetary base consists of (1)
seasonally adjusted, break-adjusted total reserves (line 1), plus (2) the seasonally
adjusted currency component of the money stock, plus (3) (for all quarterly
reporters on the "Report of Transaction Accounts, Other Deposits and Vault
Cash" and for all those weekly reporters whose vault cash exceeds their required
reserves) the seasonally adjusted, break-adjusted difference between current vault
cash and the amount applied to satisfy current reserve requirements.
7. Break-adjusted total reserves equal break-adjusted required reserves (line 9)
plus excess reserves (line 16).
8. To adjust required reserves for discontinuities that are due to regulatory
changes in reserve requirements, a multiplicative procedure is used to estimate
1.00
.16
what required reserves would have been in past periods had current reserve
requirements been in effect. Break-adjusted required reserves include required
reserves against transactions deposits and nonpersonal time and savings deposits
(but not reservable nondeposit liabilities).
9. The break-adjusted monetary base equals (1) break-adjusted total reserves
(line 6), plus (2) the (unadjusted) currency component of the money stock, plus (3)
(for all quarterly reporters on the "Report of Transaction Accounts, Other
Deposits and Vault Cash" and for all weekly reporters whose vault cash exceeds
their required reserves) the break-adjusted difference between current vault cash
and the amount applied to satisfy current reserve requirements.
10. Reflects actual reserve requirements, including those on nondeposit liabilities, with no adjustments to eliminate the effects of discontinuities associated
with changes in reserve requirements.
11. Reserve balances with Federal Reserve Banks plus vault cash used to
satisfy reserve requirements.
12. The monetary base, not break-adjusted and not seasonally adjusted,
consists of (1) total reserves (line 11), plus (2) required clearing balances and
adjustments to compensate for float at Federal Reserve Banks, plus (3) the
currency component of the money stock, plus (4) (for all quarterly reporters on
the "Report of Transaction Accounts, Other Deposits and Vault Cash" and for all
those weekly reporters whose vault cash exceeds their required reserves) the
difference between current vault cash and the amount applied to satisfy current
reserve requirements. Since the introduction of changes in reserve requirements
(CRR), currency and vault cash figures have been measured over the computation
periods ending on Mondays.
13. Unadjusted total reserves (line 11) less unadjusted required reserves (line 14).
A14
1.21
Domestic Financial Statistics • February 1993
M O N E Y STOCK, LIQUID A S S E T S , A N D D E B T M E A S U R E S 1
Billions of dollars, averages of daily figures
Item
1988
Dec.
1992
1989
Dec.
1990
Dec.
1991
Dec.
Aug/
Sept.
Oct/
Nov.
Seasonally adjusted
Measures
1 Ml
786.9
3,071.1
3,923.1
4,677.1
9,326.3
794.1
3,227.3
4,059.8
4,890.6
10,076.7
826.1
3,339.0
4,114.6
4,965.2
10,751.3
898.1
3,439.8
4.171.0
4.988.1
11,201.3'
973.1
3.471.2
4.176.3
5,024.8
11,564.7
988.6
3,481.9
4,183.1r
5,043.8r
11,5%.5 r
1,007.2
3,497.0
4,184.4
5,051.7
11,622.4
1.019.0
3.507.1
4,190.7
n.a.
n.a.
212.3
7.5
286.5
280.6
222.6
7.4
279.0
285.1
246.8
8.3
277.1
293.9
267.3
8.2
289.5
333.2
282.3
7.9
320.6
362.2
286.4
8.3
327.8
366.1
288.4
8.6
336.2
374.0
289.9
8.6
339.2
381.2
2,284.2
852.0
2,433.2
832.5
2,512.9
775.6
2,541.7
731.2
2,498.1
705.1
2,493.3r
701.2r
2,489.8
687.4
2,488.2
683.6
Commercial banks
12 Savings deposits, including MMDAs
13 Small time deposits''
14 Large time deposits 10, 11
542.7
447.0
366.9
541.5
531.0
398.2
581.9
606.4
374.0
664.9
598.5
354.0
724.3
534.8
316.4
734.4
527.3r
312.0
743.4
519.4
305.4
749.8
511.6
303.0
Thrift institutions
15 Savings deposits, including MMDAs
16 Small time deposits 9
17 Large time deposits 10
383.5
585.9
174.3
349.7
617.5
161.1
338.8
562.3
120.9
377.7
464.5
83.1
421.3
393.1
68.2
425.1
387.9r
68.0
428.2
379.3
67.9
431.8
372.9
66.5
Money market mutual funds
18 General purpose and broker-dealer .
19 Institution-only
241.9
91.0
316.3
107.2
348.9
133.7
360.5
179.1
349.7
217.2
344.7r
217.2
347.6
205.6
348.7
203.5
2,101.5
7,224.8
2,249.5
7,827.2
2,493.4
8,258.0
2,764.8
8,436.5r
2,992.4
8,572.3
3,004.8r
8,591.7r
3,001.4
8,621.0
2
3
4
5
M2
M3
L
Debt
6
7
8
9
Ml components
Currency
Travelers checks 4
Demand deposits
Other checkable deposits 6
Nontrqnsaction
10 In M2
11 In M3
components
Debt components
20 Federal debt
21 Nonfederal debt
n.a.
n.a.
Not seasonally adjusted
2
22
23
24
25
26
Measures
Ml
M2
M3
L
Debt
27
28
29
30
Ml components
Currency
Travelers checks 4
Demand deposits 5
Other checkable deposits 6
804.1
3,083.8
3,934.7
4,694.2
9,312.5
811.9
3,240.0
4,070.3
4,909.9
10,063.6
844.1
3,351.9
4,124.7
4,984.9
10,739.9
917.3
3.453.6
4.181.7
5,008.3
ll,191.4 r
970.6
3,470.2
4,179.0
5,018.4
11,526.6
983.0
3,473.3
4,174.2r
5,033.5r
ll,569.0 r
1,001.2
3,492.3
4,174.9
5,040.5
11,600.5
1,021.9
3,510.5
4,192.8
n.a.
n.a.
214.8
6.9
298.9
283.5
225.3
6.9
291.5
288.1
249.5
7.8
289.9
296.9
270.0
7.7
303.0
336.5
282.9
8.8
319.2
359.7
284.7
8.9
325.4
364.0r
287.0
8.7
336.0
369.5
290.1
8.3
343.4
380.1
2,279.7
850.8
2,428.1
830.3
2,507.8
772.8
2,536.3
728.0
2,499.6
708.8
2,490.3
700.9r
2,491.1
682.7
2,488.6
682.3
Commercial banks
33 Savings deposits, including MMDAs
34 Small time deposits .
35 Large time deposits 10 ' 11
543.8
446.0
365.9
543.0
529.5
397.1
580.0
606.3
373.0
662.4
598.7
352.8
726.2
534.5
318.0
733.4
527.0r
313.2
742.1
520.4
305.4
749.4
512.1
302.6
Thrift institutions
36 Savings deposits, including MMDAs
37 Small time deposits
38 Large time deposits 10
381.1
584.9
175.2
347.6
616.0
162.0
337.7
562.2
120.6
376.3
464.6
82.8
422.4
392.9
68.6
424.6r
387.6r
68.3
427.5
380.1
67.9
431.6
373.2
66.4
Money market mutual funds
39 General purpose and broker-dealer
40 Institution-only
240.8
91.4
314.6
107.8
346.8
134.4
358.1
180.3
348.0
213.8
343.5r
210.0
345.9
199.8
347.6
202.2
Repurchase agreements and eurodollars
41 Overnight
42 Term
83.2
227.4
77.5
178.5
74.7
158.3
76.2
127.7
75.8
124.1
74.2
123.7r
75.0
125.3
74.6
127.9
2,098.9
7,213.5
2,247.5
7,816.2
2,491.3
8,248.6
2,765.0
8,426.4r
2,970.3
8,556.3
2,993.9
8,575.0r
2,998.1
8,602.4
Nontrqnsaction
31 In M2;
32 In M3 8
components
Debt components
43 Federal debt
44 Nonfederal debt
For notes see following page.
n.a.
n.a.
Monetary and Credit Aggregates
NOTES TO TABLE 1.21
1. Latest monthly and weekly figures are available from the Board's H.6 (508)
weekly statistical release. Historical data are available from the Money and
Reserves Projection Section, Division of Monetary Affairs, Board of Governors of
the Federal Reserve System, Washington, DC 20551.
2. Composition of the money stock measures and debt is as follows:
Ml: (1) currency outside the Treasury, Federal Reserve Banks, and the vaults
of depository institutions; (2) travelers checks of nonbank issuers; (3) demand
deposits at all commercial banks other than those due to depository institutions,
the U.S. government, and foreign banks and official institutions, less cash items in
the process of collection and Federal Reserve float; and (4), other checkable
deposits (OCDs), consisting of negotiable order of withdrawal (NOW) and
automatic transfer service (ATS) accounts at depository institutions, credit union
share draft accounts, and demand deposits at thrift institutions. Seasonally
adjusted Ml is computed by summing currency, travelers checks, demand
deposits, and OCDs, each seasonally adjusted separately.
M2: Ml plus (1) overnight (and continuing-contract) repurchase agreements
(RPs) issued by all depository institutions and overnight Eurodollars issued to
U.S. residents by foreign branches of U.S. banks worldwide, (2) savings (including MMDAs) and small time deposits (time deposits—including retail RPs—in
amounts of less than $100,000), and (3) balances in both taxable and tax-exempt
general purpose and broker-dealer money market funds. Excludes individual
retirement accounts (IRAs) and Keogh balances at depository institutions and
money market funds. Also excludes all balances held by U.S. commercial banks,
money market funds (general purpose and broker-dealer), foreign governments
and commercial banks, and the U.S. government. Seasonally adjusted M2 is
computed by adjusting its non-Mi component as a whole and then adding this
result to seasonally adjusted Ml.
M3: M2 plus (1) large time deposits and term RP liabilities (in amounts of
$100,000 or more) issued by all depository institutions, (2) term Eurodollars held
by U.S. residents at foreign branches of U.S. banks worldwide and at all banking
offices in the United Kingdom and Canada, and (3) balances in both taxable and
tax-exempt, institution-only money market funds. Excludes amounts held by
depository institutions, the U.S. government, money market funds, and foreign
banks and official institutions. Also excluded is the estimated amount of overnight
RPs and Eurodollars held by institution-only money market funds. Seasonally
adjusted M3 is computed by adjusting its non-M2 component as a whole and then
adding this result to seasonally adjusted M2.
L: M3 plus the nonbank public holdings of U.S. savings bonds, short-term
Treasury securities, commercial paper, and bankers acceptances, net of money
A15
market fund holdings of these assets. Seasonally adjusted L is computed by
summing U.S. savings bonds, short-term Treasury securities, commercial paper,
and bankers acceptances, each seasonally adjusted separately, and then adding
this result to M3.
Debt: Debt of domestic nonfinancial sectors consists of outstanding credit
market debt of the U.S. government, state and local governments, and private
nonfinancial sectors. Private debt consists of corporate bonds, mortgages, consumer credit (including bank loans), other bank loans, commercial paper, bankers
acceptances, and other debt instruments. Data are derived from the Federal
Reserve Board's flow of funds accounts. Debt data are based on monthly
averages. This sum is seasonally adjusted as a whole.
3. Currency outside the U.S. Treasury, Federal Reserve Banks, and vaults of
depository institutions.
4. Outstanding amount of U.S. dollar-denominated travelers checks of nonbank issuers. Travelers checks issued by depository institutions are included in
demand deposits.
5. Demand deposits at commercial banks and foreign-related institutions other
than those due to depository institutions, the U.S. government, and foreign banks
and official institutions, less cash items in the process of collection and Federal
Reserve float.
6. Consists of NOW and ATS account balances at all depository institutions,
credit union share draft account balances, and demand deposits at thrift institutions.
7. Sum of (1) overnight RPs and overnight Eurodollars, (2) money market fund
balances (general purpose and broker-dealer), (3) MMDAs, and (4) savings and
small time deposits.
8. Sum of (1) large time deposits, (2) term RPs, (3) term Eurodollars of U.S.
residents, and (4) money market fund balances (institution-only), less a consolidation adjustment that represents the estimated amount of overnight RPs and
Eurodollars held by institution-only money market funds.
9. Small time deposits—including retail RPs—are those issued in amounts of
less than $100,000. All IRAs and Keogh accounts at commercial banks and thrift
institutions are subtracted from small time deposits.
10. Large time deposits are those issued in amounts of $100,000 or more,
excluding those booked at international banking facilities.
11. Large time deposits at commercial banks less those held by money market
funds, depository institutions, and foreign banks and official institutions.
A16
1.22
Domestic Financial Statistics • February 1993
B A N K DEBITS A N D DEPOSIT T U R N O V E R 1
Debits are in billions of dollars; turnover is ratio of debits to deposits; monthly data are at annual rates
1992
Bank group, or type of customer
19892
1990 2
1991
Apr.
May
June
July
Aug.
Sept.
Seasonally adjusted
Demand deposits
1 All insured banks
2 Major New York City banks
3 Other banks
4 ATS-NOW accounts 4
5 Savings deposits
256,150.4
129,319.9
126,830.5
277,916.3
131,784.0
146,132.3
281,050.1
140,905.5
140,144.6
315,651.2
167,177.5
148,473.7
292,177.4
154,225.3
137,952.1
302,259.2
149,743.3
152,515.9
336,868.4
179,593.4
157,275.0
298,612.4
154,231.2
144,381.2
340,723.8
184,557.7
156,166.1
2,910.5
547.5
3,349.6
558.8
3,624.6
1,377.4
3,957.0
3,356.5
3,552.6
3,241.4
4,070.7
3,838.9
4,024.0
3,724.9
3,594.2
2,995.9
3,940.5
3,274.9
735.1
3,421.5
408.3
800.6
3,804.1
467.7
817.6
4,391.9
449.6
857.4
5,029.1
443.3
771.2
4,438.0
400.9
814.2
4,470.1
451.6
910.5
5,425.1
466.9
779.4
4,445.7
414.4
880.7
5,350.4
443.2
15.2
3.0
16.5
2.9
16.1
3.3
15.6
4.7
13.7
4.4
15.6
5.1
15.3
5.0
13.5
4.1
14.7
4.6
DEPOSIT TURNOVER
Demand deposits3
6 All insured banks
7 Major New York City banks
8 Other banks
9 ATS-NOW accounts 4
10 Savings deposits
Not seasonally adjusted
DEBITS TO
Demand deposits3
11 All insured banks
12 Major New York City banks
13 Other banks
14 ATS-NOW accounts 4
15 MMDAs 6
16 Savings deposits
256,133.2
129,400.1
126,733.0
277,400.0
131,784.7
145,615.3
280,922.8
140,563.0
140,359.7
314,388.6
164,994.4
149,394.3
290,950.2
153,163.7
137,786.5
311,175.8
154,953.8
156,222.0
336,160.9
178,555.6
157,605.3
310,646.4
162,973.4
147,673.1
329,854.7
178,998.2
150,856.4
2,910.7
2,677.1
546.9
3,342.2
2,923.8
557.9
3,622.4
n.a
1,408.3
4,104.5
n.a
3,459.2
3,515.5
n.a
3,031.2
4,032.5
n.a
3,472.9
3,925.6
n.a
3,461.5
3,669.6
n.a
3,110.6
3,938.9
n.a
3,317.2
735.4
3,426.2
408.0
799.6
3,810.0
466.3
817.5
4,370.1
450.6
849.3
5,042.4
442.7
785.8
4,551.3
409.3
842.5
4,668.3
464.7
903.0
5,312.2
465.4
824.6
4,867.0
430.2
852.6
5,205.2
428.0
15.2
7.9
2.9
16.4
8.0
2.9
16.1
n.a
3.4
15.7
n.a
4.9
13.7
n.a
4.3
15.6
n.a
4.9
15.2
n.a
4.8
14.0
n.a
4.3
14.9
n.a
4.6
DEPOSIT TURNOVER
Demand deposits3
17 All insured banks
18 Major New York City banks
19 Other banks
20 ATS-NOW accounts 4
21 MMDAs 6
22 Savings deposits
1. Historical tables containing revised data for earlier periods can be obtained
from the Banking and Money Market Statistics Section, Division of Monetary
Affairs, Board of Governors of the Federal Reserve System, Washington, DC
20551.
Data in this table also appear on the Board's G.6 (406) monthly statistical
release. For ordering address, see inside front cover.
2. Annual averages of monthly figures.
3. Represents accounts of individuals, partnerships, and corporations and of
states and political subdivisions.
4. Accounts authorized for negotiable orders of withdrawal (NOWs) and
accounts authorized for automatic transfer to demand deposits (ATSs).
5. Excludes ATS and NOW accounts.
6. Money market deposit accounts.
Commercial Banking Institutions
1.23
A17
All Commercial Banks 1
L O A N S A N D SECURITIES
Billions of dollars, averages of Wednesday figures
1991
1992
Dec.
Ian.
r
Feb.
r
Mar.
r
Apr/
May
r
June r
July r
Aug/
Sept/
Oct/
Nov.
Seasonally adjusted
1 Total loans and securities
1
2 U.S. government securities
i Other securities
4 Total loans and leases
5
Commercial and industrial . . . . .
6
Bankers acceptances h e l d 2 . . .
7
Other commercial and
industrial
8
U.S. addressees 3
9
Non-U.S. addressees
10
Real estate
11
Individual
12
Security
13
Nonbank financial
institutions
14
Agricultural
15
State and political
subdivisions
Foreign banks
lb
17
Foreign official institutions
18
Lease-financing receivables
19
All other loans
r
2,852.0
2,854.8
2,863.1
2,877.5
2,877.6
2,883.7
2,884.4
2,897.2
2,913.3
2,924.9
2,936.6
562.6
179.4r
2,096.6 r
618.0 r
7.3
566.2
179.7
2,106.1
617.3
7.2
571.2
180.5
2,103.1
613.2
7.2
579.5
178.1
2,105.5
610.9
6.9
592.3
178.5
2,106.7
609.2
6.5
601.7
177.1
2,098.8
607.3
6.6
611.7
175.5
2,096.5
604.7
6.1
619.5
177.8
2,087.1
603.1
6.7
634.1
178.1
2,085.1
600.7
6.5
639.1
178.0
2,096.2
602.9
6.3
646.2
178.9
2,099.8
603.3
7.3
653.6
177.9
2,105.0
606.0
7.7
610.7 r
603.3 r
7.4
873.1
363.5
54.5
610.1
603.7
6.5
873.5
363.1
59.4
606.0
599.5
6.5
877.5
363.6
57.1
603.9
597.3
6.7
879.4
362.2
60.4
602.7
595.8
6.9
881.4
360.7
64.9
600.7
593.5
7.1
882.6
358.9
61.6
598.6
591.7
7.0
881.2
359.0
63.9
596.4
588.8
7.6
878.9
358.6
60.7
594.2
586.8
7.4
878.4
357.2
62.5
596.6
588.9
7.6
882.6
356.5
66.2
596.0
588.0
8.1
887.1
355.2
65.7
598.3
590.3
8.0
889.5
354.6
64.4
40.6
34.0
40.8
33.7
42.6
33.5
43.7
34.3
42.7
34.4
43.0
34.3
42.0
34.8
40.7
34.8
41.8
35.3
44.3
35.3
44.3
35.0
45.1
34.7
29.1
7.4
2.4
31.7
42.4
28.0
7.2
2.3
31.5
49.2
28.1
6.7
2.1
31.6
47.1
28.0
6.5
2.1
31.5
46.5
27.7
6.5
2.0
31.6
45.6
27.2
6.9
2.0
31.7
43.3
26.8
7.5
2.0
32.0
42.4
26.4
7.8
2.1
31.0
43.1
26.0
7.1
2.1
30.7
43.3
26.0
7.9
2.1
30.8
41.6
25.5
7.2
2.1
30.6
43.8
25.2
6.8
2.5
30.5
45.8
2,838.7
Not seasonally adjusted
20 Total loans and securities
1
21 U.S. government securities
22 Other securities
23 Total loans and leases'
24
Commercial and industrial . . . . .
25
Bankers acceptances h e l d 2 . . .
26
Other commercial and
industrial
27
U.S. addressees
28
Non-U.S. addressees
29
Real estate
30
Individual
31
Security
32
Nonbank financial
institutions
33
Agricultural
34
State and political
subdivisions
Foreign banks
35
36
Foreign official institutions
37
Lease-financing receivables
38
All other loans
r
2,848.8
2,857.4
2,864.0
2,876.6
2,873.1
2,884.6
2,876.7
2,893.7
2,912.5
2,927.4
2,942.2
558.6 r
179.7r
2,106.8 r
619.3 r
7.6
565.7
180.3
2,102.8
614.2
7.2
575.1
180.5
2,101.8
612.4
7.4
584.9
178.2
2,100.8
613.5
6.9
594.5
178.1
2,104.0
612.1
6.3
601.8
176.8
2,094.6
609.6
6.6
610.7
175.5
2,098.4
606.7
6.2
616.7
176.8
2,083.2
602.9
6.3
631.8
178.2
2,083.7
599.0
6.3
636.9
177.9
2,097.7
600.1
6.3
644.8
179.1
2,103.4
601.8
7.3
654.8
178.1
2,109.3
604.7
7.9
611.7 r
604.7 r
7.0
873.4
368.1
55.1
606.9
600.0
6.9
872.9
367.4
59.0
605.0
598.1
6.9
874.5
363.6
61.7
606.7
599.8
6.9
875.9
359.7
62.2
605.8
598.6
7.2
880.2
358.1
66.4
603.0
595.9
7.1
883.2
357.3
58.2
600.5
593.2
7.4
881.6
356.9
63.8
596.6
589.0
7.6
880.1
355.9
58.7
592.7
585.3
7.3
880.4
356.2
60.7
593.9
586.4
7.5
883.5
357.9
64.1
594.5
587.0
7.5
888.5
356.1
65.9
596.8
589.4
7.4
890.9
356.1
65.0
41.9
34.0
41.3
33.2
42.3
32.7
43.1
33.0
42.3
33.4
42.3
33.9
42.3
35.0
41.0
35.6
42.0
36.2
43.6
36.3
43.8
35.8
45.3
35.0
29.0
7.9
2.4
31.7
44.1
28.4
7.0
2.3
31.8
45.4
28.2
6.6
2.1
31.7
46.0
28.0
6.4
2.1
31.7
45.2
27.6
6.4
2.0
31.6
44.0
27.3
6.8
2.0
31.7
42.3
26.8
7.2
2.0
31.7
44.2
26.2
7.7
2.1
30.8
42.4
25.9
6.9
2.1
30.6
43.6
25.9
8.0
2.1
30.7
45.3
25.5
7.4
2.1
30.7
45.6
25.2
7.2
2.5
30.6
46.7
2,845.l
1. Adjusted to exclude loans to commercial banks in the United States.
2. Includes nonfinancial commercial paper held.
3. United States includes the fifty states and the District of Columbia.
A18
1.24
Domestic Financial Statistics • February 1993
MAJOR N O N D E P O S I T F U N D S O F C O M M E R C I A L B A N K S 1
Billions of dollars, monthly averages
1991
1992
Source of funds
Dec.
Jan.
Feb.
Mar.
Apr.
May
June r
July r
Aug.
Sept. r
Oct. r
Nov.
Seasonally adjusted
1 Total nondeposit funds 2
2 Net balances due to related foreign offices 3 . . .
3 Borrowings from other than commercial banks
in United States 4
4
Domestically chartered banks
5
Foreign-related banks
281.4r
39.2
283. l r
43.4
286.8r
42.0
287.0*
45.1
290.0"
49.3
289.6*
54.2
292.0
60.2
292.4
61.8
297.8'
59.0r
304.7
61.9
304.2
65.4
308.2
68.7
242.3r
154.7r
87.5
239.6r
156.5r
83.1
244.8r
159.8r
84.9
241.9*
155.8r
86.1
240.7r
152.8r
87.9
235.4r
147.6r
87.8
231.9
144.3
87.5
230.6
142.8
87.7
238.9
149.1
89.8
242.8
150.8
91.9
238.7
151.9
86.8
239.5
150.7
88.7
Not seasonally adjusted
6 Total nondeposit funds
7 Net balances due to related foreign offices . . .
8
Domestically chartered banks
9
Foreign-related banks
10 Borrowings from other than commercial banks
in United States
11
Domestically chartered banks
12
Federal funds and security RP
borrowings
Other 6
13
14 Foreign-related banks
279.7r
42.7
-3.8
46.5
279.0"
44.1
-4.6
48.7
287.4r
42.2
-.7
42.9
290.9*
45.5
-.7
46.3
287.2*
47.8
-5.0
52.9
295.4*
56.7
-4.3
60.9
293.5
59.8
-6.4
66.2
288.9
58.3
-7.0
65.3
294.9*
57.4*
-9.3
66.6*
302.0
61.2
-11.0
72.3
305.5
64.7
-12.8
77.5
312.9
69.8
-11.7
81.4
236.9r
153.4r
234.9*
152.2*
245.2r
160.3r
245.4r
158.9*
239.4*
150.8*
238.8*
150.2*
233.7
144.5
230.6
141.4
237.5*
147.4
240.8
149.8
240.8
152.9
243.1
155.2
150.3r
3.1
83.5
148.8r
3.4
82.7
156.8r
3.5
84.9
155.7*
3.3
86.5
147.4*
3.4
88.5
146.4*
3.9
88.5
140.4
4.1
89.2
137.2
4.2
89.2
143.5
3.9
90.2
146.0
3.8
91.0
149.4
3.6
87.9
151.1
4.1
87.9
423.9
422.6
416.0
413.6
413.7
412.6
406.9
407.4
399.9
398.8
396.7
398.0
392.4
393.7
386.1
385.9
384.6
386.2
381.2
382.4
373.3
373.4
370.0
369.7
26.4
25.4
27.8
33.1
19.5
25.2
21.8
20.1
19.9
17.7
17.0
21.0
25.8
25.2
21.9
19.7
32.6
22.4
25.4
28.7
22.4
21.9
19.2
16.3
MEMO
Gross large time deposits1
15 Seasonally adjusted
16 Not seasonally adjusted
U.S. Treasury demand balances at
commercial banks
17 Seasonally adjusted
:
18 Not seasonally adjusted
1. Commercial banks are nationally and state-chartered banks in the fifty states
and the District of Columbia, agencies and branches of foreign banks, New York
investment companies majority owned by foreign banks, and Edge Act corporations owned by domestically chartered and foreign banks.
Data in this table also appear in the Board's G.10 (411) release. For ordering
address, see inside front cover.
2. Includes federal funds, repurchase agreements (RPs), and other borrowing
from nonbanks and net balances due to related foreign offices.
3. Reflects net positions of U.S. chartered banks, Edge Act corporations, and
U.S. branches and agencies of foreign banks with related foreign offices plus net
positions with own International Banking Facilities (IBFs).
4. Borrowings through 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, term federal
funds, loan RPs, and sales of participations in pooled loans.
5. Figures are based on averages of daily data reported weekly by approximately 120 large banks and quarterly or annual data reported by other banks.
6. Figures are partly averages of daily data and partly averages of Wednesday
data.
7. Time deposits in denominations of $100,000 or more. Estimated averages of
daily data.
8. U.S. Treasury demand deposits and Treasury tax-and-loan notes at commercial banks. Averages of daily data.
Commercial Banking Institutions
1.25
A S S E T S A N D LIABILITIES OF COMMERCIAL B A N K S 1
A19
Wednesday figures
Millions of dollars
1992
Account
Sept. 30r
Oct. 7 r
Oct. 14r
Oct. 21r
Oct. 28r
Nov. 4
Nov. 11
Nov. 18
Nov. 25
3,082,431
779,171
616,169
163,001
36,801
22,704
2,823
11,274
2,266,460
162,545
2,103,915
602,370
883,465
73,082
810,383
357,296
260,784
210,743
23,568
31,069
27,387
84,280
44,440
285,895
3,085,254
781,427
617,554
163,873
40,669
25,291
3,205
12,174
2,263,158
161,551
2,101,607
602,275
888,104
73,791
814,313
355,288
255,940
198,246
24,353
29,551
28,111
71,798
44,433
289,218
3,095,321
785,062
621,621
163,442
40,051
24,217
3,394
12,441
2,270,208
167,425
2,102,783
602,023
888,400
73,811
814,589
355,432
256,928
241,223
36,036
31,915
33,801
95,372
44,099
291,071
3,079,500
784,038
620,875
163,163
40,023
24,689
3,292
12,043
2,255,439
151,975
2,103,464
601,066
887,285
73,817
813,469
356,727
258,385
199,319
23,330
31,326
29,036
71,849
43,779
286,597
3,083,140
781,244
618,179
163,065
41,140
24,924
3,592
12,624
2,260,756
157,129
2,103,627
601,072
889,267
73,770
815,496
356,737
256,551
203,675
24,519
31,658
29,978
73,334
44,186
287,048
3,103,254
787,271
624,152
163,118
42,073
25,489
3,375
13,209
2,273,910
165,527
2,108,383
603,766
891,468
73,677
817,792
356,376
256,773
211,216
27,764
28,919
30,220
80,059
44,232
300,123
3,111,423
790,010
627,609
162,401
41,533
25,550
3,299
12,683
2,279,880
172,922
2,106,959
603,223
893,176
73,778
819,398
355,066
255,495
223,869
28,813
30,963
32,517
87,193
44,361
297,892
3,105,865
787,732
625,523
162,209
45,636
28,974
3,097
13,566
2,272,497
166,106
2,106,391
604,184
890,308
73,777
816,531
355,879
256,020
207,948
20,818
32,578
29,314
79,980
45,257
291,631
3,114,204
788,803
626,442
162,361
42,819
27,775
2,727
12,317
2,282,582
171,587
2,110,995
606,197
889,600
73,725
815,875
356,134
259,065
221,399
26,321
31,198
32,291
86,893
44,723
286,843
3,579,069
3,572,718
3,627,615
3,565,416
3,573,863
3,614,593
3,633,184
3,605,444
3,622,446
2,488,529
728,450
3,933
39,739
684,778
729,024
650,217
380,838
498,834
34,143
464,691
329,238
2,497,439
719,539
2,560
37,827
679,153
740,630
651,618
385,652
484,893
19,423
465,470
326,467
2,529,188
752,067
3,003
44,696
704,368
743,210
649,609
384,302
508,243
14,469
493,774
325,993
2,474,466
708,411
2,400
38,174
667,838
738,886
647,297
379,872
496,316
15,880
480,436
331,072
2,478,780
718,235
2,502
39,037
676,6%
738,839
645,007
376,699
491,593
16,221
475,372
339,965
2,517,869
747,585
3,394
40,103
704,088
747,952
643,982
378,349
499,145
8,097
491,048
332,668
2,523,261
752,638
2,445
42,239
707,954
751,315
642,109
377,199
513,754
18,701
495,053
331,197
2,495,559
734,583
2,821
38,682
693,079
744,349
640,038
376,590
500,918
6,924
493,994
344,768
2,515,270
754,848
4,288
43,536
707,025
743,563
638,816
378,044
491,657
6,964
484,693
350,016
3,316,600
3,308,799
3,363,423
3,301,855
3,310,337
3,349,682
3,368,211
3,341,245
3,356,943
262,469
263,919
264,192
263,561
263,526
264,911
264,973
264,199
265,503
ALL COMMERCIAL BANKING INSTITUTIONS 2
1
7
3
4
6
7
8
9
10
11
17
N
14
15
16
17
18
19
7.0
71
77
n
24
Assets
Loans and securities
Investment securities
U.S. government securities
Other
Trading account assets
U.S. government securities
Other securities
Other trading account assets
Total loans
Interbank loans
Loans excluding interbank
Commercial and industrial
Real estate
Revolving home equity
Other
Individual
All other
Total cash assets
Balances with Federal Reserve Banks
Cash in vault
Demand balances at U.S. depository institutions..
Cash items
Other cash assets
Other assets
25 Total assets
76
77
28
79
30
31
37,
33
34
35
36
37
Liabilities
Total deposits
Transaction accounts
Demand, U.S. government
Demand, depository institutions
Other demand and all checkable deposits
Savings deposits (excluding checkable)
Small time deposits
Time deposits over $100,000
Borrowings
Treasury tax and loan notes
Other
Other liabilities
38 Total liabilities
39 Residual (assets less liabilities)3
Footnotes appear on the following page.
A20
1.25
Domestic Financial Statistics • February 1993
A S S E T S A N D LIABILITIES OF COMMERCIAL B A N K S 1
Wednesday
figures—Continued
Millions of dollars
Account
Sept. 30 r
Oct. T
Oct. 14r
Oct. 21 r
Oct. 28 r
Nov. 4
Nov. 11
Nov. 18
Nov. 25
2,731,481
718,699
577,310
141,388
36,801
22,704
2,823
11,274
1,975,981
137,808
1,838,174
441,132
831,015
73,082
757,933
357,296
208,730
180,119
22,501
31,037
25,820
81,901
2,746,792
723,802
582,118
141,684
40,051
24,217
3,394
12,441
1,982,939
141,840
1,841,099
440,356
835,849
73,811
762,038
355,432
209,462
211,380
35,060
31,879
32,168
92,883
19,391
175,588
2,728,854
722,834
581,117
141,718
40,023
24,689
3,292
12,043
1,965,997
129,415
1,836,582
439,367
834,727
73,817
760,910
356,727
205,760
170,971
22,900
31,291
27,546
69,487
19,746
168,941
2,733,532
721,480
580,034
141,446
41,140
24,924
3,592
12,624
1,970,912
133,381
1,837,532
439,259
836,866
73,770
763,0%
356,737
204,669
175,091
23,783
31,622
28,511
70,801
20,373
171,364
2,754,932
726,237
584,583
141,654
42,073
25,489
3,375
13,209
1,986,623
144,322
1,842,301
441,480
838,852
73,677
765,176
356,376
205,593
183,804
27,364
28,885
28,755
77,884
20,894
177,747
2,756,749
727,887
586,516
141,371
41,533
25,550
3,299
12,683
1,987,329
146,729
1,840,601
440.761
840,540
73,778
766.762
355,066
204,234
196,393
2,750,033
726,243
584,664
141,579
45,636
28,974
3,097
13,566
1,978,154
139,071
1,839,083
440,321
837,678
73,777
763,901
355,879
205,205
179,712
20,345
32,542
27,956
77,686
176,162
2.743.145
720,952
579,060
141,891
40,669
25,291
3,205
12,174
1,981,524
140,924
1,840,600
440,666
835,657
73,791
761,866
355,288
208,990
168,781
23,946
29,516
26,691
69,402
19,225
171,221
169,115
2,754,546
726,755
585,404
141,351
42,819
27,775
2,727
12,317
1,984,972
143,686
1,841,286
441,699
836,941
73,725
763,216
356,134
206,512
193,261
25,643
31,162
30,935
84,582
20,966
168,802
3,087,762
3.083.146
3,133,760
3,068,765
3,079,988
3,116,483
3,130,146
3,098,860
3,116,610
2,330,548
717,040
3,932
36,974
676,135
724,163
647,564
241,781
363,159
34,143
329,016
135,159
2,339,989
708,472
2,559
35,278
670,635
735,868
648,968
246,681
352,190
19,423
332,767
130,621
2,371,981
740,945
3,002
42,161
695,782
738,355
646,956
245,725
370,917
14,469
356,448
130,244
2,318,252
697,728
2,399
35,723
659,606
733,960
644,656
241,908
360,725
15,880
344,845
129,800
2,319,916
707,324
2,502
36,568
668,254
734,117
642,382
236,093
364,954
2,363,986
742,098
2,443
39,837
699,817
746,441
639,499
235,949
373.398
18,701
354,697
131,362
2,336,475
724,219
348,733
135,166
2,358,732
736,827
3,393
37,407
696,027
743,133
641,368
237,405
363,333
8,097
355,236
133,080
36,323
685,075
739,619
637,451
235,186
366,520
6,924
359,5%
135,239
2,353,837
744,300
4,287
41,115
698,898
738,783
636,225
234,528
364,650
6,964
357,686
136,193
2,828,866
2,822,801
2,873,142
2,808,777
2,820,035
2,855,145
2,868,747
2,838,234
2,854,680
258,895
260,346
260,619
259,988
259,953
261,338
261.399
260,626
261,929
DOMESTICALLY CHARTERED COMMERCIAL BANKS 4
Assets
40 Loans and securities
41
Investment securities
42
U.S. government securities
43
Other
44
Trading account assets
45
U.S. government securities
46
Other securities
47
Other trading account assets
48
Total loans
49
Interbank loans
50
Loans excluding interbank
51
Commercial and industrial
52
Real estate
53
Revolving home equity
54
Other
55
Individual
56
All other
57 Total cash assets
58
Balances with Federal Reserve Banks
59
Cash in vault
60
Demand balances at U.S. depository institutions
61
Cash items
62
Other cash assets
63 Other assets
64 Total assets
65
66
67
68
69
70
71
72
73
74
75
76
Liabilities
Total deposits
Transaction accounts
Demand, U.S. government
Demand, depository institutions
Other demand and all checkable deposits
Savings deposits (excluding checkable)
Small time deposits
Time deposits over $100,000
Borrowings
Treasury tax and loan notes
Other
Other liabilities
77 Total liabilities
78
Residual (assets less liabilities) 3
18,861
1. Excludes assets and liabilities of International Banking Facilities.
2. Includes insured domestically chartered commercial banks, agencies and
branches of foreign banks, Edge Act and Agreement corporations, and New York
State foreign investment corporations. Data are estimates for the last Wednesday
of the month based on a sample of weekly reporting foreign-related and domestic
institutions and quarter-end condition reports.
16,221
28,021
30,926
30,991
84,884
21,548
177,004
21,182
2,821
3. This balancing item is not intended as a measure of equity capital for use in
capital adequacy analysis.
4. Includes all member banks and insured nonmember banks. Loans and
securities data are estimates for the last Wednesday of the month based on a
sample of weekly reporting banks and quarter-end condition reports.
Weekly Reporting Commercial Banks
1.26
A21
A S S E T S A N D LIABILITIES OF L A R G E W E E K L Y REPORTING COMMERCIAL B A N K S
Millions of dollars, Wednesday figures
1992
Account
Sept. 30
Oct. 7*
Oct. 14*
Oct. 21*
Oct. 28*
Nov. 4
Nov. 11
Nov. 18
Nov. 25
ASSETS
1 Cash and balances due from depository institutions
2 U.S. Treasury and government securities
3 Trading account
4
Investment account
5
Mortgage-backed securities 1
All others, by maturity
6
One year or less
7
One year through five years
8
More than five years
9 Other securities
10 Trading account
11 Investment account
12
State and political subdivisions, by maturity
N
One year or less
14
More than one year
15
Other bonds, corporate stocks, and securities
16 Other trading account assets
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
Federal funds sold2
To commercial banks in the United States
To nonbank brokers and dealers
To others 3
Other loans and leases, gross
Commercial and industrial
Bankers acceptances and commercial paper
All other
U.S. addressees
Non-U.S. addressees
Real estate loans
Revolving, home equity
All other
To individuals for personal expenditures
To financial institutions
Commercial banks in the United States
Banks in foreign countries
Nonbank financial institutions
For purchasing and carrying securities
To finance agricultural production
To states and political subdivisions
To foreign governments and official institutions
All other loans
Lease-financing receivables
LESS: Unearned income
Loan and lease reserve
Other loans and leases, net
Other assets
45 Total assets
Footnotes appear on the following page.
105,578r
268,067r
20,484
247,582r
79,193
97,992
267,039
20,632
246,408
78,910
130,352
266,938
20,951
245,987
78,787
99,768
267,738
22,406
245,332
79,957
103,566
267,627
22,236
245,390
80,587
108,701
271,276
22,714
248,562
81,130
115,382
272,236
23,108
249,128
81,048
105,484
274,025
26,016
248,008
79,697
114,899
273,052
25,0%
247,955
82,286
26,686
77,306*
64,398r
55,009
2,717
52,292
20,986
3,411
17,576
31,306
11,039
26,823
77,130
63,546
55,589
3,097
52,492
20,860
3,377
17,483
31,632
11,936
26,818
79,491
60,891
55,583
3,287
52,2%
20,759
3,255
17,504
31,537
12,204
26,661
78,587
60,127
55,452
3,185
52,267
20,763
3,253
17,510
31,504
11,808
27,730
77,608
59,466
55,255
3,485
51,770
20,754
3,252
17,503
31,016
12,389
27,639
76,981
62,811
55,607
3,270
52,337
20,634
3,220
17,414
31,703
12,974
28,115
77,436
62,528
55,465
3,1%
52,270
20,621
3,217
17,405
31,649
12,449
28,954
78,006
61,351
55,281
2,993
52,288
20,613
3,213
17,399
31,675
13,334
29,349
76,134
60,186
54,861
2,624
52,237
20,586
3,223
17,364
31,651
12,086
83,827
56,245
24,064
3,518
976,851r
277,980*
l,591 r
276,390*
274,521*
1,869
396,795*
42,529*
354,265*
176,826*
38,281*
13,600*
2,9%*
21,685
15,937
6,262
15,616*
907
23,950*
24,298*
2,668
36,985*
937,199*
162,321*
87,255
54,951
26,651
5,653
974,798
278,089
1,586
276,503
274,787
1,716
400,006
43,056
356,950
176,088
37,302
13,642
2,031
21,629
14,602
6,194
15,420
923
21,844
24,332
2,693
36,940
935,165
157,466
89,053
59,267
24,323
5,462
978,595
278,397
1,778
276,619
274,646
1,973
399,303
43,081
356,222
176,160
38,116
13,960
2,272
21,884
17,369
6,1%
15,293
861
22,622
24,280
2,685
36,951
938,959
160,098
78,155
48,863
24,679
4,613
973,352
277,390
1,885
275,505
273,575
1,930
397,838
43,015
354,822
176,978
37,256
13,232
2,721
21,302
15,677
6,152
15,227
853
21,709
24,273
2,686
36,997
933,669
155,735
80,197
51,969
23,394
4,833
976,168
277,627
1,895
275,732
274,004
1,728
399,505
43,020
356,486
176,937
37,704
13,776
2,384
21,544
16,228
6,121
15,159
836
21,845
24,205
2,685
37,033
936,449
157,676
82,011
54,221
22,699
5,091
980,088
279,677
2,146
277,530
275,760
1,771
400,995
42,975
358,020
176,742
39,385
14,542
1,976
22,866
14,492
6,116
15,080
1,426
21,820
24,355
2,647
37,399
940,042
163,695
84,964
56,981
22,805
5,179
979,441
278,933
2,328
276,605
274,931
1,673
402,766
43,144
359,622
175,966
39,154
14,828
1,927
22,399
14,818
6,015
15,070
1,337
21,166
24,217
2,638
37,449
939,354
163,139
79,924
49,537
25,468
4,919
977,720
279,156
2,349
276,807
275,157
1,650
400,746
43,118
357,628
176,346
39,384
15,453
1,758
22,173
14,056
5,957
15,000
1,397
21,511
24,168
2,363
37,507
937,851
157,612
82,073
53,874
23,919
4,281
982,278
280,827
2,649
278,178
276,427
1,751
399,698
43,061
356,636
176,774
39,929
15,236
2,459
22,234
16,323
5,901
15,000
1,326
22,354
24,148
2,329
37,401
942,548
157,347
l,623,040r
1,612,442
1,653,186
1,602,325
1,613,159
1,634,305
1,642,990
1,623,511
1,636,867
A22
1.26
Domestic Financial Statistics • February 1993
A S S E T S A N D LIABILITIES OF LARGE W E E K L Y REPORTING COMMERCIAL BANKS—Continued
Millions of dollars, Wednesday figures
1992
Account
Sept. 30
Oct. 7 r
Oct. 14r
Oct. 21 r
Oct. 28 r
Nov. 4
Nov. 11
Nov. 18
N o v . 25
1,111,323r
265,697 r
215,279 r
50,418
8,484
2,359
21,854
6,524
934
10,263
106,683
738,943 r
713,306 r
25,637 r
21,721 r
1,787
1,826
304
1,116,133
254,295
208,837
45,458
7,786
1,564
21,388
5,210
652
8,857
108,737
753,101
726,715
26,386
22,139
2,135
1,809
303
1,139,363
279,313
226,091
53,223
8,215
1,801
26,725
5,423
576
10,483
107,208
752,841
726,144
26,698
22,373
2,137
1,883
304
1,100,247
249,898
203,142
46,757
8,320
1,439
22,028
4,825
671
9,473
106,781
743,567
716,930
26,637
22,282
2,139
1,903
314
1,102,562
255,454
206,645
48,809
8,245
1,471
22,579
5,488
699
10,328
110,515
736,594
710,087
26,507
22,189
2,133
1,868
318
1,123,989
264,307
214,955
49,352
9,032
2,070
22,800
5,144
882
9,424
116,118
743,564
716,627
26,936
22,236
2,355
2,036
310
1,126,347
268,261
219,426
48,835
8,406
1,471
24,533
5,127
718
8,580
114,698
743,389
716,508
26,880
22,136
2,363
2,069
312
1,109,473
260,881
212,106
48,775
8,481
1,703
22,130
5,000
698
10,763
113,443
735,149
708,176
26,973
22,279
2,385
1,993
316
1,123,883
275,826
221,763
54,063
9,867
2,677
25,783
5,714
682
9,339
113,745
734,312
707,490
26,822
22,065
2,354
2,088
316
271,049 r
380
28,973
241,696 r
260,794
0
15,211
245,583
278,714
166
11,437
267,111
267,409
0
12,340
255,069
271,319
0
13,195
258,124
271,436
0
6,605
264,830
278,776
0
15,769
263,007
272,522
125
5,187
267,210
271,604
783
5,149
265,672
LIABILITIES
46 Deposits
47
Demand deposits
48
Individuals, partnerships, and corporations
49
Other holders
50
States and political subdivisions
51
U.S. government
52
Depository institutions in the United States . . .
53
Banks in foreign countries
54
Foreign governments and official institutions . .
55
Certified and officers' checks
56
Transaction balances other than demand deposits 4 .
57
Nontransaction balances
58
Individuals, partnerships, and corporations
59
Other holders
60
States and political subdivisions
61
U.S. government
62
Depository institutions in the United States . . .
63
Foreign governments, official institutions, and banks .
64 Liabilities for borrowed money 5
65
Borrowings from Federal Reserve Banks
66
Treasury tax and loan notes
67
Other liabilities for borrowed money
68 Other liabilities (including subordinated notes and
debentures)
69 Total liabilities
70 Residual (total assets less total liabilities) 7
106,83 r
101,784
101,021
100,537
105,684
104,173
102,714
106,564
107,309
l,489,203 r
1,478,711
1,519,097
1,468,193
1,479,565
1,499,597
1,507,837
1,488,559
1,502,796
133,837r
133,731
134,088
134,131
133,594
134,708
135,152
134,952
134,071
l,324,948 r
126,501
1,056
515
541
24,834
—11,33 l r
1,328,023
131,101
1,060
516
544
24,815
-11,404
1,329,144
130,302
1,034
492
542
24,683
-14,370
1,324,409
126,954
1,031
490
541
24,945
-13,428
1,325,890
121,524
1,023
484
539
25,033
-9,651
1,333,193
123,005
1,061
476
585
24,887
-15,530
1,332,746
121,893
1,060
477
583
24,919
-14,202
1,335,294
121,532
1,040
476
563
24,670
-13,777
1,335,241
121,719
1,014
465
549
25,001
-10,893
MEMO
71
72
73
74
75
76
77
Total loans and leases, gross, adjusted, plus securities'
Time deposits in amounts of $100,000 or more
Loans sold outright to affiliates 9
Commercial and industrial
Other
Foreign branch credit extended to U.S. residents 1 0 ...
Net due to related institutions abroad
1. Includes certificates of participation, issued or guaranteed by agencies of the
U.S. government, in pools of residential mortgages.
2. Includes securities purchased under agreements to resell.
3. Includes allocated transfer risk reserve.
4. Includes negotiable order of withdrawal accounts (NOWs), automatic transfer service (ATS), and telephone and preauthorized transfers of savings deposits.
5. Includes borrowings only from other than directly related institutions.
6. Includes federal funds purchased and securities sold under agreements to
repurchase.
7. This balancing item is not intended as a measure of equity capital for use in
capital-adequacy analysis.
8. Excludes loans to and federal funds transactions with commercial banks in
the United States.
9. Affiliates include a bank's own foreign branches, nonconsolidated nonbank
affiliates of the bank, the bank's holding company (if not a bank), and nonconsolidated nonbank subsidiaries of the holding company.
10. Credit extended by foreign branches of domestically chartered weekly
reporting banks to nonbank U.S. residents. Consists mainly of commercial and
industrial loans, but includes an unknown amount of credit extended to other than
nonfinancial businesses.
NOTE. Data that formerly appeared in table 1.28, Assets and Liabilities of Large
Weekly Reporting Commercial Banks in New York City, can be obtained from the
Board's H.4.2 (504) weekly statistical release. For ordering address, see inside
front cover.
Weekly Reporting
1.30
Commercial Banks
L A R G E W E E K L Y REPORTING U . S . B R A N C H E S A N D A G E N C I E S OF FOREIGN B A N K S
Liabilities 1
A23
Assets and
Millions of dollars, Wednesday figures
1992
Account
Sept. 30"
20
21
Cash and balances due from depository
institutions
U.S. Treasury and government agency
securities
Other securities
Federal funds sold
To commercial banks in the United States . . .
Toothers 2
Other loans and leases, gross
Commercial and industrial
Bankers acceptances and commercial
paper
All other
U.S. addressees
Non-U.S. addressees
Loans secured by real estate
To financial institutions
Commercial banks in the United States..
Banks in foreign countries
Nonbank financial institutions
For purchasing and carrying securities
To foreign governments and official
institutions
All other
Other assets (claims on nonrelated parties) ..
22
Total assets3
23
36
37
Deposits or credit balances due to other
than directly related institutions
Demand deposits
Individuals, partnerships, and
corporations
Other
Nontransaction accounts
Individuals, partnerships, and
corporations
Other
Borrowings from other than directly
related institutions
Federal funds purchased
From commercial banks in the
United States
From others
Other liabilities for borrowed money
To commercial banks in the
United States
To others
Other liabilities to nonrelated parties
38
Total liabilities6
1
2
3
4
5
6
7
8
9
10
11
1?
N
14
IS
16
17
18
19
24
25
76
27
28
29
30
31
32
33
34
35
Oct.
7R
Oct.
14R
Oct.
21 R
Oct.
28
Nov.
4
Nov.
11
Nov.
18
Nov.
25
20,738
19,919
20,186
19,129
18,468
18,513
19,050
18,980
24,494
8,385
22,132
6,828
15,303
161,434
97,032
24,261
8,530
17,517
4,557
12,960
160,177
97,264
24,904
8,437
19,843
7,197
12,646
161,588
97,299
25,067
8,309
22,614
5,419
17,195
160,338
97,318
24,040"
8,383R
20,966
5,632
15,333
162,213R
97,390"
24,947
8,307
20,230
4,647
15,582
161,280
97,682
25,916
8,130
22,959
7,089
15,870
162,078
97,792
25,767
7,%7
22,560
7,484
15,076
163,627
98,646
25,882
8,122
24,260
7,%2
16,298
164,107
99,033
2,666
94,366
91,372
2,994
34,725
22,797
5,649
2,604
14,544
4,629
3,230
94,034
91,099
2,934
34,730
22,469
5,920
2,262
14,287
3,405
3,068
94,231
91,321
2,910
34,799
22,198
6,034
2,178
13,985
4,952
2,904
94,415
91,521
2,894
34,804
22,587
5,849
2,174
14,565
3,387
2,813
94,577R
91,643R
2,934
34,699""
23,424R
6,508R
2,216
14,700"
4,409
2,650
95,032
92,057
2,975
34,882
22,880
6,046
2,225
14,609
3,355
2,749
95,043
92,147
2,8%
34,895
23,358
6,276
2,122
14,960
3,509
2,837
95,808
92,858
2,951
34,891
23,686
6,435
2,079
15,172
3,816
2,695
%,338
93,410
2,927
34,910
23,877
6,320
2,266
15,291
3,829
377
1,875
30,113
371
1,939
29,965
374
1,966
28,530
378
1,863
28,964
374
L,917 R
29,736R
363
2,118
31,908
353
2,171
31,852
354
2,234
30,885
356
2,102
30,505
304,501
303,387
306,117
307,930
306,147R
308,838
311,999
314,273
313,793
99,172
4,397
99,222
3,928
99,393
3,741
99,992
3,606
102,346
3,705
102,280
3,614
102,228
3,689
102,670
3,658
104,805
3,817
3,428
969
94,775
3,144
784
95,294
2,993
748
95,652
2,894
712
96,386
2,879
826
98,641
2,898
716
98,666
2,976
713
98,539
2,976
681
99,012
3,074
743
100,988
68,638
26,136
69,191
26,103
69,982
25,670
68,973
27,413
70,551
28,090
71,297
27,370
70,462
28,077
70,502
28,511
72,072
28,916
94,626
48,022
92,541
49,771
95,784
52,039
94,567
45,579
88,288
41,264
94,723
46,807
97,909
48,966
93,730
44,681
88,545
41,874
17,050
30,972
46,604
17,072
32,699
42,770
16,079
35,960
43,745
11,498
34,081
48,988
11,898
29,366
47,024
13,640
33,167
47,915
15,198
33,768
48,943
12,870
31,811
49,049
14,521
27,353
46,672
9,811
36,793
30,368
9,327
33,444
29,837
10,106
33,640
28,810
9,958
39,030
28,938
10,67lr
36,353R
30,222R
9,537
38,378
30,917
9,552
39,391
32,258
10,683
38,367
30,303
10,272
36,399
30,874
304,501
303,387
306,117
307,930
306,147R
308,838
311,999
314,273
313,793
203,968
43,131
200,009
38,769
201,541
39,502
205,061
40,925
203,462R
43,778R
204,071
37,220
205,718
37,053
206,002
43,153
208,088
47,631
19,2%
MEMO
39
40
Total loans (gross) and securities, adjusted ..
Net due to related institutions abroad
1. Includes securities purchased under agreements to resell.
2. Includes transactions with nonbank brokers and dealers in securities.
3. Includes net due from related institutions abroad for U.S. branches and
agencies of foreign banks having a net "due from" position.
4. Includes other transaction deposits.
5. Includes securities sold under agreements to repurchase.
6. Includes net to related institutions abroad for U.S. branches and agencies of
foreign banks having a net "due t o " position.
7. Excludes loans to and federal funds transactions with commercial banks in
the United States.
A24
1.32
Domestic Financial Statistics • February 1993
COMMERCIAL PAPER A N D B A N K E R S DOLLAR A C C E P T A N C E S O U T S T A N D I N G
Millions of dollars, end of period
Year ending December
1992
Item
1987
1988
1989
1990
1991
May
June
July
Aug.
Sept.
Oct.
Commercial paper (seasonally adjusted unless noted otherwise)
1 AU issuers
2
3
4
5
Financial companies 1
Dealer-placed paper
Total
Bank-related (not seasonally
adjusted)
Directly placed paper
Total
Bank-related (not seasonally
adjusted)
6 Nonfinancial companies 5
358,997
458,464
525,831
561,142
530,300
533,719
542,205
547,242
545,801
549,731
558,468
102,742
159,777
183,622
215,123
214,445
226,552
234,212
226,943
231,586
233,977
231,132
1,428
1,248
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
174,332
194,931
210,930
199,835
183,195
168,914
171,321
179,725
173,772
179,731
182,059
43,173
43,155
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
81,923
103,756
131,279
146,184
132,660
138,253
136,672
140,574
140,443
136,023
145,277
Bankers dollar acceptances (not seasonally adjusted) 6
7 Total
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
8
9
10
11
12
13
70,565
66,631
62,972
54,771
43,770
38,384
37,767
37,733
37,090
37,814
37,599
10,943
9,464
1,479
9,086
8,022
1,064
9,433
8,510
924
9,017
7,930
1,087
11,017
9,347
1,670
9,255
7,954
1,301
9,680
8,129
1,551
9,225
7,808
1,417
9,372
7,927
1,446
10,436
9,073
1,363
10,236
8,764
1,472
0
965
58,658
0
1,493
56,052
0
1,066
52,473
0
918
44,836
0
1,739
31,014
0
1,477
27,653
0
1,338
26,749
0
1,269
27,239
0
1,851
25,866
0
1,803
25,575
0
1,204
26,159
16,483
15,227
38,854
14,984
14,410
37,237
15,651
13,683
33,638
13,095
12,703
28,973
12,843
10,351
20,577
11,893
8,702
17,790
11,569
9,062
17,135
11,825
9,015
16,893
11,600
7,861
17,628
12,227
8,051
17,536
12,116
7,849
17,633
1. Institutions engaged primarily in commercial, savings, and mortgage banking; sales, personal, and mortgage financing; factoring, finance leasing, and other
business lending; insurance underwriting; and other investment activities.
2. Includes all financial-company paper sold by dealers in the open market.
3. Bank-related series were discontinued in January 1989.
4. As reported by financial companies that place their paper directly with
investors.
5. Includes public utilities and firms engaged primarily in such activities as
communications, construction, manufacturing, mining, wholesale and retail trade,
transportation, and services.
1.33
6. Data on bankers acceptances are gathered from institutions whose acceptances total $100 million or more annually. The reporting group is revised every
January. In January 1988, the group was reduced from 155 to 111 institutions. The
current group, totaling approximately 100 institutions, accounts for more than 90
percent of total acceptances activity.
PRIME RATE C H A R G E D BY B A N K S on Short-Term Business Loans 1
Percent per year
Date of change
1990— Jan.
Rate
1
8
10.50
10.00
1991— Jan. 2
Feb. 4
May 1
Sept. 13 .
Nov. 6
Dec. 23
9.50
9.00
8.50
8.00
7.50
6.50
1992— July
6.00
2
Period
Average
rate
1990
1991
1992
10.01
8.46
6.25
1990- -Jan. .
Feb.
Mar.
Apr.
May .
June
July .
Aug.
Sept.
Oct. .
Nov.
Dec.
10.11
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
1. Data in this table also appear in the Board's H.15 (519) weekly and G.13
(415) monthly statistical releases. For ordering address, see inside front cover.
Period
1991—Jan. ...
Feb. ..
Mar. ..
Apr. ..
May ...
June ..
July ...
Aug. ..
Sept. ..
Oct. ...
Nov. ..
Dec. ..
Average
rate
9.52
9.05
9.00
9.00
8.50
8.50
8.50
8.50
8.20
8.00
7.58
7.21
Period
1992—Jan. ...
Feb. ..
Mar. ..
Apr. ..
May ...
June ..
July ...
Aug. ..
Sept. ..
Oct. ...
Nov. ..
Dec. ..
Financial Markets
1.35
A25
INTEREST R A T E S Money and Capital Markets
Averages, percent per year; weekly, monthly, and annual figures are averages of business day data unless otherwise noted
1992
Item
1989
1990
1992, week ending
1991
Aug.
Sept.
Oct.
Nov.
Oct. 30
Nov. 6
Nov. 13
Nov. 20
Nov. 27
MONEY MARKET INSTRUMENTS
Federal funds 1-2-3
2 Discount window borrowing '
1
Commercial
1-month
3-month
5 6-month
8.10
6.98
5.69
5.45
3.30
3.00
3.22
3.00
3.10
3.00
3.09
3.00
2.96
3.00
3.07
3.00
2.91
3.00
2.97
3.00
3.10
3.00
9.11
8.99
8.80
8.15
8.06
7.95
5.89
5.87
5.85
3.38
3.38
3.44
3.25
3.24
3.26
3.22
3.33
3.33
3.25
3.66
3.67
3.26
3.47
3.48
3.25
3.48
3.49
3.28
3.59
3.60
3.25
3.76
3.76
3.22
3.79
3.79
8.99
8.72
8.16
8.00
7.87
7.53
5.73
5.71
5.60
3.28
3.27
3.29
3.13
3.08
3.11
3.14
3.24
3.23
3.20
3.59
3.56
3.21
3.38
3.35
3.20
3.44
3.43
3.21
3.54
3.53
3.20
3.67
3.63
3.19
3.70
3.64
paper3,5,6
3
4
6
7
8
9.21
6.93
placed3-5-7
Finance paper, directly
1-month
3-month
6-month
9
10
Bankers acceptances*'5*
3-month
6-month
8.87
8.67
7.93
7.80
5.70
5.67
3.28
3.35
3.10
3.13
3.19
3.19
3.51
3.51
3.32
3.32
3.35
3.35
3.47
3.47
3.60
3.60
3.60
3.60
11
12
13
Certificates qf deposit,
marker9
1-month
3-month
6-month
9.11
9.09
9.08
8.15
8.15
8.17
5.82
5.83
5.91
3.29
3.31
3.40
3.14
3.13
3.17
3.11
3.26
3.27
3.23
3.58
3.60
3.16
3.39
3.41
3.15
3.42
3.44
3.15
3.52
3.53
3.15
3.68
3.69
3.33
3.67
3.69
14
Eurodollar deposits, 3-month 3-10
9.16
8.16
5.86
3.33
3.15
3.30
3.67
3.46
3.46
3.61
3.79
3.78
8.11
8.03
7.92
7.50
7.46
7.35
5.38
5.44
5.52
3.13
3.21
3.33
2.91
2.96
3.06
2.86
3.04
3.17
3.13
3.34
3.52
2.94
3.19
3.36
3.03
3.23
3.42
3.08
3.30
3.47
3.16
3.37
3.56
3.24
3.43
3.60
8.12
8.04
7.91
7.51
7.47
7.36
5.42
5.49
5.54
3.14
3.23
3.28
2.97
3.01
3.02
2.84
2.98
3.12
3.14
3.35
3.61
2.97
3.22
n.a.
3.05
3.27
n.a.
3.10
3.31
n.a.
3.13
3.37
3.61
3.27
3.45
n.a.
8.53
8.57
8.55
8.50
8.52
8.49
8.45
7.89
8.16
8.26
8.37
8.52
8.55
8.61
5.86
6.49
6.82
7.37
7.68
7.86
8.14
3.47
4.19
4.72
5.60
6.12
6.59
7.39
3.18
3.89
4.42
5.38
5.96
6.42
7.34
3.30
4.08
4.64
5.60
6.15
6.59
7.53
3.68
4.58
5.14
6.04
6.49
6.87
7.61
3.50
4.35
4.93
5.85
6.34
6.78
7.63
3.58
4.44
5.03
5.96
6.47
6.90
7.69
3.64
4.51
5.09
6.00
6.48
6.88
7.64
3.73
4.64
5.17
6.05
6.48
6.84
7.54
3.76
4.69
5.24
6.12
6.52
6.86
7.56
8.58
8.74
8.16
7.19
7.08
7.26
7.43
7.39
7.47
7.44
7.39
7.41
7.00
7.40
7.23
6.%
7.29
7.27
6.56
6.99
6.92
5.67
6.03
6.16
5.92
6.27
6.25
6.10
6.51
6.41
6.05
6.46
6.36
6.21
6.64
6.62
6.13
6.56
6.51
6.08
6.49
6.38
6.05
6.46
6.28
6.05
6.46
6.26
9.66
9.77
9.23
8.29
8.26
8.41
8.51
8.51
8.56
8.55
8.46
8.47
9.26
9.46
9.74
10.18
9.32
9.56
9.82
10.36
8.77
9.05
9.30
9.80
7.95
8.21
8.34
8.65
7.92
8.17
8.31
8.62
7.99
8.32
8.49
8.84
8.10
8.40
8.58
8.%
8.07
8.41
8.58
8.96
8.11
8.46
8.64
9.02
8.14
8.44
8.62
9.00
8.07
8.35
8.52
8.91
8.06
8.36
8.54
8.91
37 A-rated, recently offered utility bonds 16
9.79
10.01
9.32
8.16
8.11
8.40
8.51
8.52
8.65
8.49
8.40
8.48
MEMO: Dividend-price ratio17
38 Preferred stocks
39 Common stocks
9.05
3.45
8.96
3.61
8.17
3.25
7.21
2.97
7.14
3.00
7.22
3.07
7.43
2.98
7.31
3.01
7.40
3.02
7.44
2.98
7.41
2.98
7.45
2.94
18
19
20
U.S. Treasury bills
Secondary market •
3-month
6-month
1-year
Auction average ' • 1
3-month
6-month
1-year
21
22
23
24
25
26
27
Constant maturities12
1-year
2-year
3-year
5-year
7-year
10-year
30-year
15
16
17
secondary
U . S . TREASURY NOTES AND BONDS
Composite
28 More than 10 years (long-term)
STATE AND LOCAL NOTES AND BONDS
Moody's series13
29
30 Baa
31 Bond Buyer series
CORPORATE BONDS
32 Seasoned issues, all industries 15
33
34
35
36
Rating group
Aaa
Aa
A
Baa
1. The daily effective federal funds rate is a weighted average of rates on
trades through New York brokers.
2. Weekly figures are averages of seven calendar days ending on Wednesday
of the current week; monthly figures include each calendar day in the month.
3. Annualized using a 360-day year or bank interest.
4. Rate for the Federal Reserve Bank of New York.
5. Quoted on a discount basis.
6. An average of offering rates on commercial paper placed by several leading
dealers for firms whose bond rating is AA or the equivalent.
7. An average of offering rates on paper directly placed by finance companies.
8. Representative closing yields for acceptances of the highest-rated money
center banks.
9. An average of dealer offering rates on nationally traded certificates of
deposit.
10. Bid rates for Eurodollar deposits at 11 a.m. London time. Data are for
indication purposes only.
11. Auction date for daily data; weekly and monthly averages computed on an
issue-date basis.
12. Yields on actively traded issues adjusted to constant maturities. Source:
U.S. Treasury.
13. General obligations based on Thursday figures; Moody's Investors Service.
14. General obligations only, with twenty years to maturity, issued by twenty
state and local governmental units of mixed quality. Based on figures for
Thursday.
15. Daily figures from Moody's Investors Service. Based on yields to maturity
on selected long-term bonds.
16. Compilation of the Federal Reserve. This series is an estimate of the yield
on recently offered, A-rated utility bonds with a thirty-year maturity and five
years of call protection. Weekly data are based on Friday quotations.
17. Standard 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.
NOTE. These data also appear in the Board's H. 15 (519) and G.13 (415) releases.
For ordering address, see inside front cover.
A26
1.36
Domestic Financial Statistics • February 1993
STOCK MARKET
Selected Statistics
1992
Indicator
1989
1990
1991
Mar.
Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.
Prices and trading volume (averages of daily figures)
Common stock prices <indexes)
1 New York Stock Exchange
(Dec. 31, 1965 = 50)
7
180.13
228.04
174.90
94.33
162.01
183.66
226.06
158.80
90.72
133.21
206.35
258.16
173.97
92.64
150.84
225.21
282.36
204.09
94.15
173.49
224.55
281.60
201.28
94.92
171.05
228.55
285.17
207.88
98.24
175.89
224.68
279.54
202.02
97.23
174.82
228.17
281.90
198.36
101.18
180.96
230.07
284.44
191.31
103.41
180.47
230.13
285.76
191.61
102.26
178.27
226.97
279.70
192.30
101.62
181.36
232.84
287.80
204.63
101.13
189.27
6 Standard & Poor's Corporation
(1941-43 = 10)1
323.05
335.01
376.20
407.36
407.41
414.81
408.27
415.05
417.93
418.48
412.50
422.84
7 American Stock Exchange
(Aug. 31, 1973 = 50?
356.67
338.32
360.32
404.09
388.06
392.63
385.56
384.07
385.80
382.67
371.27
387.75
165,568
13,124
156,359
13,155
179,411
12,486
185,581
15,654
206,251
14,096
182,027
13,455
195,089
11,216
194,138
10,722
174,003
11,875
191,774
11,198
204,787
11,966
208,221
n.a.
4
5
Utility
Volume of trading (thousands of shares)
8
9
Customer financing (millions of dollars, end-of-period balances)
10 Margin credit at broker-dealers
34,320
28,210
36,660
39,090
38,750
39,890
39,690
39,640
39,940
41,250
41,590
43,630
Free credit balances at brokers4
11 Margin accounts
12 Cash accounts
7,040
18,505
8,050
19,285
8,290
19,255
7,350
19,305
8,780
16,400
7,700
18,695
7,780
19,610
7,920
18,775
8,060
18,305
8,060
19,650
8,355
18,700
8,500
19,310
Margin requirements (percent of market value and effective date) 6
13 Margin stocks
14 Convertible bonds
15 Short sales
Mar. 11, 1968
June 8, 1968
May 6, 1970
Dec. 6, 1971
Nov. 24, 1972
70
50
70
80
60
80
65
50
65
55
50
55
65
50
65
1. Effective July 1976, includes a new financial group, banks and insurance
companies. With this change the index includes 400 industrial stocks (formerly
425), 20 transportation (formerly 15 rail), 40 public utility (formerly 60), and 40
financial.
2. On July 5, 1983, the American Stock Exchange rebased its index, effectively
cutting previous readings in half.
3. Since July 1983, under the revised Regulation T, margin credit at brokerdealers has included credit extended against stocks, convertible bonds, stocks
acquired through the exercise of subscription rights, corporate bonds, and
government securities. Separate reporting of data for margin stocks, convertible
bonds, and subscription issues was discontinued in April 1984.
4. Free credit balances are amounts in accounts with no unfulfilled commitments to brokers and are subject to withdrawal by customers on demand.
5. New series since June 1984.
6. These requirements, stated in regulations adopted by the Board of Governors pursuant to the Securities Exchange Act of 1934, limit the amount of credit
that can be used to purchase and carry "margin securities" (as defined in the
regulations) when such credit is collateralized by securities. Margin requirements
Jan. 3, 1974
50
50
50
on securities other than options are the difference between the market value (100
percent) and the maximum loan value of collateral as prescribed by the Board.
Regulation T was adopted effective Oct. 15, 1934; Regulation U, effective May 1,
1936; Regulation G, effective Mar. 11, 1968; and Regulation X, effective Nov. 1,
1971.
On Jan. 1, 1977, the Board of Governors for the first time established in
Regulation T the initial margin required for writing options on securities, setting
it at 30 percent of the current market value of the stock underlying the option. On
Sept. 30, 1985, the Board changed the required initial margin, allowing it to be the
same as the option maintenance margin required by the appropriate exchange or
self-regulatory organization; such maintenance margin rules must be approved by
the Securities and Exchange Commission. Effective Jan. 31, 1986, the SEC
approved new maintenance margin rules, permitting margins to be the price of the
option plus 15 percent of the market value of the stock underlying the option.
Effective June 8, 1988, margins were set to be the price of the option plus 20
percent of the market value of the stock underlying the option (or 15 percent in the
case of stock-index options).
Financial Markets
1.37
S E L E C T E D F I N A N C I A L INSTITUTIONS
All
Selected Assets and Liabilities
Millions of dollars, end of period
1992
1991
Account
1989
1990
Dec.
Jan.
Mar.
Feb.
Apr.
May
June"
July"
Aug."
Sept.
SAIF-insured institutions
1 Assets
1,249,055
1,084,821
919,979
909,014
906,142
883,407
872,026
870,334
862,511
856,376
856,151
847,470
733,729
633,385
551,322
545,728
541,734
529,158
524,954r
521,911"
516,617
512,254
512,066
508,829
170,532
155,228
129,461
127,371
127,766
125,272
124,763
124,225
123,454
123,363
120,421
120,204
25,457
32,150
58,685
16,897
24,125
48,753
12,307
17,139
41,775
11,917
16,827
40,857
11,608
16,050
39,908
10,979
15,400
38,717
11,270
14,017
37,403
12,044
13,930
37,241
11,164
13,520
37,114
11,053
n.a.
36,742
2 Mortgages
3 Mortgage-backed
securities
4
Contra-assets to
mortgage assets 1 .
5 Commercial loans
6 Consumer loans
Contra-assets to non7
mortgage loans 1 ..
8 Cash and investment
securities
9 Other 2
10,959"
15,073
37,999"
11,120"
14,607
38,869"
949
946
912
912
970
120,763
63,030
119,384
62,845
120,220
62,319
124,140
60,960
120,249
60,044
856,376
856,151
847,470
676,140
109,036
62,359
46,677
18,569
52,630
672,354
110,109
62,225
47,884
20,522
53,166
667,009
110,014
64,105
45,909
18,083
52,365
3,592
1,939
1,239
1,314
1,115
-1,008
166,053
116,955
146,644
95,522
120,077
73,751
118,610
72,653
121,969
71,637
119,543
67,387
10 Liabilities and net worth . 1,249,055
1,084,821
919,979
909,014
906,142
883,407
872,026
870,334
862,511
945,656
252,230
124,577
127,653
27,556
23,612
835,4%
197,353
100,391
%,%2
21,332
30,640
731,937
121,923
65,842
56,081
17,560
48,559
721,099
119,915
62,642
57,273
18,941
49,009
717,026
118,554
63,138
55,416
21,329
49,233
703,811
110,031
62,628
47,403
18,295
51,271
689,777
111,262
62,268
48,994
18,883
52,103"
688,199
110,126
61,439
48,687
19,626
52,383"
682,535
108,943
62,760
46,183
17,751
52,283
11
12
13
14
15
16
Savings capital
Borrowed money
FHLBB
Other
Other
Net worth
NOTE. Components do not sum to totals because of rounding. Data for credit
unions and life insurance companies have been deleted from this table. Starting in
the December 1991 issue, data for life insurance companies are shown in a special
table of quarterly data.
SOURCE. Savings Association Insurance Fund (SAIF)-insured
institutions:
Estimates by the Office of Thrift Supervision (OTS) for all institutions insured by
the SAIF and based on the OTS thrift institution Financial Report.
1. Contra-assets are credit-balance accounts that must be subtracted from the
corresponding gross asset categories to yield net asset levels. Contra-assets to
mortgage assets, mortgage loans, contracts, and pass-through securities—include
loans in process, unearned discounts and deferred loan fees, valuation allowances
for mortgages "held for sale," and specific reserves and other valuation allowances. Contra-assets to nonmortgage loans include loans in process, unearned
discounts and deferred loan fees, and specific reserves and valuation allowances.
2. Includes holding of stock in Federal Home Loan Bank and finance leases
plus interest.
1.38
980"
116,462
64,711
F E D E R A L F I S C A L A N D F I N A N C I N G OPERATIONS
Millions of dollars
Calendar year
Fiscal year
1992
Type of account or operation
1990
U.S. budget1
1 Receipts, total
On-budget
2
3 Off budget
4 Outlays, total
5 On-budget
6
Off budget
7 Surplus or deficit ( - ) , total
8
On-budget
9
Off budget
Source of financing (total)
10 Borrowing from the public
11 Operating cash (decrease, or increase ( - ) ) . . .
12 Other 2
1991
1992
June
July
Aug.
Sept.
Oct.
Nov.
1,031,308
749,654
281,654
1,251,766
1,026,701
225,064
-220,458
-277,047
56,590
1,054,265
760,382
293,883
1,323,757
1,082,072
241,685
-269,492
-321,690
52,198
1,091,692
789,266
302,426
1,381,895
1,129,337
252,559
-290,204
-340,071
49,867
120,920
91,438
29,482
117,137
102,329
14,808
3,783
-10,891
14,674
79,080
55,977
23,103
122,226
99,935
22,291
-43,146
-43,958
812
78,218
55,434
22,784
102,920
79,128
23,792
-24,702
-23,694
-1,008
118,344
92,813
25,531
112,943
86,709
26,235
5,400
6,104
-704
76,833
55,057
21,776
125,698
103,858
21,841
-48,865
-48,801
-65
74,635
51,221
23,414
107,365
83,446
23,919
-32,730
-32,225
-505
220,101
818
-461
276,802
-1,329
-5,981
310,918
-17,305
-3,409
22,318
-26,919
818
26,839
9,542
6,765
38,841
1,523
-15,662
9,853
-22,807
7,554
-1,552
39,420
10,997
61,969
-7,346
-21,893
40,155
7,638
32,517
41,484
7,928
33,556
58,789
24,586
34,203
47,047
13,630
33,417
37,505
6,923
30,581
35,982
6,232
29,749
58,789
24,586
34,203
19,369
4,413
14,956
26,715
6,985
19,729
MEMO
13 Treasury operating balance (level, end of
period)
14
Federal Reserve Banks
15 Tax and loan accounts
1. In accordance with the Balanced Budget and Emergency Deficit Control Act
of 1985, all former off-budget entries are now presented on-budget. Federal
Financing Bank (FFB) activities are now shown as separate accounts under the
agencies that use the FFB to finance their programs. The act also moved two
social security trust funds (federal old-age survivors insurance and federal
disability insurance) off budget. The Postal Service is included as an off-budget
item in the Monthly Treasury Statement beginning in 1990.
2. Includes special drawing rights (SDRs); reserve position on the U.S. quota
in the International Monetary Fund (IMF); loans to the IMF; other cash and
monetary assets; accrued interest payable to the public; allocations of SDRs;
deposit funds; miscellaneous liability (including checks outstanding) and asset
accounts; seigniorage; increment on gold; net gain or loss for U.S. currency
valuation adjustment; net gain or loss for IMF loan-valuation adjustment; and
profit on sale of gold.
SOURCES. Monthly Treasury Statement of Receipts and Outlays of the U.S.
Government (MTS) and the Budget of the U.S. Government.
A28
1.39
Domestic Financial Statistics • February 1993
U.S. B U D G E T RECEIPTS A N D OUTLAYS1
Millions of dollars
Fiscal year
Source or type
Calendar year
1990
1991
1992
1992
H2
HI
H2
Sept.
Oct.
Nov.
RECEIPTS
1 All sources
2 Individual income taxes, net
3
Withheld
4
Presidential Election Campaign Fund .
5
Nonwithheld
6
Refunds
Corporation income taxes
7
Gross receipts
8
Refunds
9 Social insurance taxes and contributions,
net
10
Employment taxes and
contributions
11
Self-employment taxes and
contributions
12
Unemployment insurance
13
Other net receipts
14
15
16
17
Excise taxes
Customs deposits
Estate and gift taxes
Miscellaneous receipts
1,054,265
1,091,692
503,123
540,504
519,293
561,125
118,344
76,833
74,635
467,827
404,152
32
142,693
79,050
476,465
408,352
30
149,342
81,259
230,745
207,469
3
31,728
8,455
232,389
193,440
31
109,405
70,487
234,949
210,552
55,496
33,184
37,288
34,515
33,099
33,085
32,775
8,379"
237,052
198,868
19
112,328
74,163
24,161
1,850
3,583
809
1,775
1,760
113,599
15,513
117,951
17,680
54,044
7,603
58,903
7,904
54,016
8,649
61,681
9,402
21,365
1,469
4,291
2,194
2,312
833
3%,011
413,689
178,468
214,303
186,839
224,569
33,322
29,594
32,900
370,526
385,491
167,224
199,727
175,802
208,110
32,597
28,135
30,264
25,457
20,922
4,563
24,421
23,410
4,788
2,638
8,996
2,249
22,150
12,296
2,279
3,306
8,721
2,317
20,433
14,070
2,389
3,988
316
409
0
0
1,034
426
2,270
366
42,430
15,921
11,138
22,852
45,570
17,359
11,143
27,195
17,535
8,568
5,333
16,032
20,703
7,488
5,631
8,991
24,428
8,694
5,507
13,508
22,389
8,145
5,701
10,992
4,093
1,552
1,004
2,980
3,670
1,666
1,027
1,491
4,082
1,503
954
618
1
r
1
0
0
OUTLAYS
18 All types
1,323,757
1,381,895
647,461
632,153
694,474
705,068
112,943
125,698
107,365
19
20
21
22
23
24
National defense
International affairs
General science, space, and technology .
Energy
Natural resources and environment
Agriculture
272,514
16,167
15,946
2,511
18,708
14,864
298,188
16,100
16,234
4,519
19,870
14,968
149,497
8,943
8,081
1,222
9,933
6,878
122,089
7,592
7,496
1,235
8,324
7,684
147,620"
7,660"
8,472"
1,593"
11,167"
7,388"
146,963
8,464
7,952
1,442
8,625
7,514
25,842
1,727
1,159
665
1,742
195
27,412
2,126
1,410
607
3,341
2,270
20,819
4,018
1,612
529
1,801
2,139
25
26
27
28
Commerce and housing credit
Transportation
Community and regional development . .
Education, training, employment, and
social services
75,639
31,531
7,432
9,752
33,747
7,924
37,491
3,939
17,992
14,748
3,552
36,595"
17,093"
3,783"
15,583
15,681
3,901
585
3,618
764
-2,262
2,933
1,028
-2,417
2,981
728
16,218
41,479
43,586
18,988
21,234
21,113"
23,224
2,233
3,797
3,882
29 Health
30 Social security and medicare
31 Income security
71,183
373,495
171,618
89,571
406,570
199,395
31,424
176,353
75,948
35,608
190,247
88,778
41,459"
193,156
87,948"
43,698
205,443
105,911
8,834
34,460
15,173
8,021
35,320
18,300
7,420
33,346
14,188
32
33
34
35
36
31,344
12,295
11,358
195,012
-39,356
33,973
14,481
12,874
199,422
-39,280
15,479
5,265
6,976
94,650
-19,829
14,326
6,187
5,212
98,556
-18,702
17,425
6,578"
6,822"
99,144"
-20,435
15,597
7,438
5,538
100,324
-18,229
3,213
1,277
1,869
15,435
-5,847
4,078
1,121
2,529
16,463
-2,7%
1,743
1,277
106
16,148
-2,954
Veterans benefits and services
Administration of justice
General government
Net interest 6
Undistributed offsetting receipts
1. Functional details do not sum to total outlays for calendar year data because
revisions to monthly totals have not been distributed among functions. Fiscal year
total for outlays does not correspond to calendar year data because revisions from
the Budget have not been fully distributed across months.
2. Old-age, disability, and hospital insurance, and railroad retirement accounts.
3. Old-age, disability, and hospital insurance.
4. Federal employee retirement contributions and civil service retirement and
disability fund.
5. Deposits of earnings by Federal Reserve Banks and other miscellaneous receipts.
6. Includes interest received by trust funds.
7. Consists of rents and royalties for the outer continental shelf and U.S.
government contributions for employee retirement.
SOURCES. U.S. Department of the Treasury, Monthly Treasury Statement of
Receipts and Outlays of the U.S. Government, and the U.S. Office of Management and Budget, Budget of the U.S. Government, Fiscal Year 1993.
Federal Finance
1.40
A29
F E D E R A L D E B T SUBJECT TO STATUTORY LIMITATION
Billions of dollars, end of month
1991
1990
1992
Item
Sept. 30
Dec. 31
Mar. 31
June 30
Sept. 30
Dec. 31
Mar. 31
1 Federal debt outstanding
3,266
3,397
3,492
3,563
3,683
3,820
3,897
n.a.
n.a.
2 Public debt securities
Held by public
3
4
Held by agencies
3,233
2,438
796
3,365
2,537
828
3,465
2,598
867
3,538
2,643
895
3,665
2,746
920
3,802
2,833
969
3,881
2,918
964
3,985
n.a.
n.a.
4,065
n.a.
n.a.
33
33
0
33
32
0
27
26
0
25
25
0
18
18
0
19
19
0
16
16
0
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
3,161
3,282
3,377
3,450
3,569
3,707
3,784
3,891
3,973
3,161
0
3,281
0
3,377
0
3,450
0
3,569
0
3,706
0
3,783
0
3,890
0
3,972
0
3,195
4,145
4,145
4,145
4,145
4,145
4,145
4,145
4,145
5 Agency securities
6
Held by public
Held by agencies
7
8 Debt subject to statutory limit
9 Public debt securities
10 Other debt 1
June 30
Sept. 30
MEMO
11 Statutory debt limit
1. Consists of guaranteed debt of Treasury and other federal agencies, specified
participation certificates, notes to international lending organizations, and District
of Columbia stadium bonds.
1.41
GROSS PUBLIC D E B T OF U.S. T R E A S U R Y
SOURCES. U.S. Treasury Department, Monthly Statement of the Public Debt of
the United States and Treasury Bulletin.
Types and Ownership
Billions of dollars, end of period
1992
1991
Type and holder
1 Total gross public debt
2
3
4
5
6
7
8
9
10
11
12
n
14
By type
Interest-bearing
Marketable
Bills
Notes
Bonds
Nonmarketable 1
State and local government series
Foreign issues Government
Public
Savings bonds and notes
Government account series
Non-interest-bearing
Bx holder 4
15 U.S. Treasury and other federal agencies and trust funds
16 Federal Reserve Banks
17 Private investors
18 Commercial banks
19 Money market funds
20
Insurance companies
Other companies
21
7.7 State and local treasuries
Individuals
2,3
Savings bonds
74
Other securities
25
Foreign and international
Other miscellaneous investors 6
26
1988
1990
1991
Q4
Ql
Q2
Q3
2,684.4
2,953.0
3,364.8
3,801.7
3,801.7
3,881.3
3,984.7
4,064.6
2,663.1
1,821.3
414.0
1,083.6
308.9
841.8
151.5
6.6
6.6
.0
107.6
575.6
21.3
2,931.8
1,945.4
430.6
1,151.5
348.2
986.4
163.3
6.8
6.8
.0
115.7
695.6
21.2
3,362.0
2,195.8
527.4
1,265.2
388.2
1,166.2
160.8
43.5
43.5
.0
124.1
813.8
2.8
3,798.9
2,471.6
590.4
1,430.8
435.5
1,327.2
159.7
41.9
41.9
.0
135.9
959.2
2.8
3,798.9
2,471.6
590.4
1,430.8
435.5
1,327.2
159.7
41.9
41.9
.0
135.9
959.2
2.8
3,878.5
2,552.3
615.8
1,477.7
443.8
1,326.2
157.8
42.0
42.0
.0
139.9
956.1
2.8
3,981.8
2,605.1
618.2
1,517.6
454.3
1,376.7
161.9
38.7
38.7
.0
143.2
1,002.5
2.9
4,061.8
2,677.5
634.3
1,566.4
461.8
1,384.3
157.6
37.0
37.0
.0
148.3
1,011.0
2.8
589.2
238.4
1,858.5
184.9
11.8
118.6
87.1
471.6
707.8
228.4
2,015.8
164.9
14.9
125.1
93.4
487.5
828.3
259.8
2,288.3
171.5
45.4
142.0
108.9
490.4
968.7
281.8
2,563.2
233.9
80.0
172.9
150.8
498.8
968.7
281.8
2,563.2
233.9
80.0
172.9
150.8
498.8
963.7
267.6
2,664.0
240.0
84.8
175.0
166.0
500.0
n.a.
n.a.
109.6
79.2
362.2
433.0
117.7
98.7
392.9
520.7
126.2
107.6
421.7
674.5
138.1
125.8
453.4
709.5
138.1
125.8
453.4
709.5
142.0
126.1
468.0
762.1
1. Includes (not shown separately) securities issued to the Rural Electrification
Administration, depository bonds, retirement plan bonds, and individual retirement bonds.
2. Nonmarketable series denominated in dollars, and series denominated in
foreign currency held by foreigners.
3. Held almost entirely by U.S. Treasury and other federal agencies and trust
funds.
4. Data for Federal Reserve Banks and U.S. government agencies and trust
funds are actual holdings; data for other groups are Treasury estimates.
1989
5. Consists of investments of foreign balances and international accounts in the
United States.
6. Includes savings and loan associations, nonprofit institutions, credit unions,
mutual savings banks, corporate pension trust funds, dealers and brokers, certain
U.S. Treasury deposit accounts, and federally sponsored agencies.
SOURCES. U.S. Treasury Department, data by type of security, Monthly
Statement of the Public Debt of the United States; data by holder, the Treasury
Bulletin.
A30
1.42
Domestic Financial Statistics • February 1993
U.S. GOVERNMENT SECURITIES DEALERS
Transactions 1
Millions of dollars, daily averages
1992, week ending
Aug.
Sept.
Oct
Sept. 30
Oct. 7
Oct. 14
Oct. 21
Oct. 28
Nov. 4
Nov. 11
Nov. 18
N o v . 25
IMMEDIATE TRANSACTIONS 2
By type of security
U.S. Treasury securities
1 Bills
Coupon securities, by maturity
2
Less than 3.5 years
3
3.5 to 7.5 years
4
7.5 to 15 years
5
15 years or more
Federal agency securities
Debt, maturing in
6
Less than 3.5 years
7
3.5 to 7.5 years
8
7.5 years or more
Mortgage-backed
9
Pass-throughs
10
All o t h e r s T .
11
12
13
14
15
16
By type of counterparty
Primary dealers and brokers
U.S. Treasury securities
Federal agency securities
Debt
Mortgage-backed
Customers
U.S. Treasury securities
Federal agency securities
Debt
Mortgage-backed
41,374
46,771 r
44,531
53,581
43,627
51,994
40,457
38,757
43,157
48,055
45,248
36,672
22,295 r
16,539
41,727
37,760
20,476
14,240
49,532
45,749
20,425
14,672
41,634
40,488
20,177
13,329
46,668
49,037
22,875
15,904
45,459
44,527
20,041
14,548
51,612
45,359
22,779
16,667
54,712
46,134
17,469
12,291
46,690
39,983
16,570
12,805
55,239
32,844
21,160
14,747
58,383
44,604
21,250
19,200
4,343
684
536
4,979
588
803
4,824 r
718
1,040
6,471
654
1,069
4,534
1,067
950
3,566
532
695
5,528
598
1,330
5,194
679
1,267
5,378
619
661
4,642
562
862
5,850
444
818
12,787
3,951
13,673r
4,218 r
15,889"
3,232
ll,374 r
5,014 r
15,482
3,906
20,075
4,020
15,480
2,373
13,935
3,222
14,440
2,143
21,283
2,076
20,025
3,095
35,523
r
99,904
115,212
101,875
118,979
109,286
126,365
111,066
100,125
104,753
119,618
1,016
7,240
1,371
7,552
1,697
8,254 r
1,732
5,568
1,856
7,611
1,026
9,511
2,094
7,850
1,877
8,370
1,201
8,069
1,057
11,515
1,415
10,563
56,374 r
56,893
61,936 r
58,284
69,085
58,917
62,046
59,997
54,679
62,394
71,874
4,548
9,498
4,999
10,339
4,885 r
10,867r
6,463
10,820
4,696
11,777
3,767
14,585
5,362
10,004
5,263
8,787
5,457
8,513
5,009
11,845
5,6%
12,557
2,354
2,969
3,689
2,271
4,431
3,766
3,673
3,444
2,332
4,354
3,306
2,216
1,329
2,713
10,152
1,915
1,853
2,950
10,091
2,253
1,307
3,050
1,418
1,545
2,336
7,712
2,240
1,151
2,949
11,297
2,060
1,501
3,380
11,165
2,440
865
3,283
11,234
2,293
1,511
2,585
9,690
2,106
1,906
3,219
8,545
2,493
1,250
3,202
8,%3
2,444
2,019
3,818
10,917
67
66r
20
59
52
84
7
151
11
19
50
NA
21
32
68
32
65
127
20
201
102
23
185
50
11
22,966
1,862
16,206
1,754
15,725
1,363
16,5%
1,541
19,744
691
19,000
1,899
1,569
1,180
515
1,743
1,388
730
834
1,590
1,047
706
751
1,726
1,452
1,201
827
1,786
2,582
1,389
664
1,331
1,549
450
561
1,409
FUTURES AND FORWARD
TRANSACTIONS 4
By type of deliverable
security
U.S. Treasury securities
17 Bills
Coupon securities, by maturity
18
Less than 3.5 years
19
3.5 to 7.5 years
20
7.5 to 15 years
21
15 years or more
Federal agency securities
Debt, maturing in
22
Less than 3.5 years
23
3.5 to 7.5 years
24
7.5 years or more
Mortgage-backed
25
Pass-throughs
26
Others
OPTIONS TRANSACTIONS
27
28
29
30
31
81
147
44
10,612
11
6
15,902
2,832
16,571
2,476
17,846r
1,772
17,327
2,920
18,013
1,431
433
1,054
2,795
1,084
618
825
2,009
1,317
837r
742 r
l,623 r
1,287
568
436
1,174
1,259
654
787
1,392
By type of underlying security
U.S. Treasury, coupon
securities, by maturity
Less than 3.5 years
3.5 to 7.5 years
7.5 to 15 years
15 years or more
Federal agency, mortgagebacked securities
Pass-throughs
343
299
1. Transactions are market purchases and sales of securities as reported to the
Federal Reserve Bank of New York by the U.S. government securities dealers on
its published list of primary dealers. Averages for transactions are based on the
number of trading days in the period. Immediate, forward, and futures transactions are reported at principal value, which does not include accrued interest;
options transactions are reported at the face value of the underlying securities.
Dealers report cumulative transactions for each week ending Wednesday.
2. Transactions for immediate delivery include purchases or sales of securities
(other than mortgage-backed agency securities) for which delivery is scheduled in
five business days or less and "when-issued" securities that settle on the issue
date of offering. Transactions for immediate delivery of mortgage-backed agency
securities include purchases and sales for which delivery is scheduled in thirty days or
less. Stripped securities are reported at market value by maturity of coupon or corpus.
3. Includes such securities as collateralized mortgage obligations (CMOs), real
estate mortgage investment conduits (REMICs), interest-only securities (iOs),
and principal-only securities (POs).
2,218
5
211
377
4. Futures transactions are standardized agreements arranged on an exchange.
Forward transactions are agreements made in the over-the-counter market that
specify delayed delivery. All futures transactions are included regardless of time
to delivery. Forward contracts for U.S. Treasury securities and federal agency
debt securities are included when the time to delivery is more than five business
days. Forward contracts for mortgage-backed agency securities are included
when the time to delivery is more than thirty days.
5. Options transactions are purchases or sales of put-and-call options, whether
arranged on an organized exchange or in the over-the-counter market, and include
options on futures contracts on U.S. Treasury and federal agency securities.
NOTE. In tables 1.42 and 1.43, " n . a . " indicates that data are not published
because of insufficient activity.
Data formerly shown under options transactions for U.S. Treasury securities,
bills; Federal agency securities, debt; and mortgage-backed securities, other than
pass-throughs are no longer available because of insufficient activity.
Federal Finance
1.43
U.S. GOVERNMENT SECURITIES DEALERS
A31
Positions and Financing 1
Millions of dollars
1992
1992, week ending
Item
Aug.
Sept.
Oct.
Sept. 30
Oct. 7
Oct. 14
Oct. 21
Oct. 28
Nov. 4
Nov. 11
Nov. 18
Positions 2
N E T IMMEDIATE POSITIONS 3
1
2
3
4
5
6
7
8
9
10
11
12
13
By type of security
U.S. Treasury securities
Bills
Coupon securities, by maturity
Less than 3.5 years
3.5 to 7.5 years
7.5 to 15 years
15 years or more
Federal agency securities
Debt, maturing in
Less than 3.5 years
3.5 to 7.5 years
7.5 years or more
Mortgage-backed
Pass-throughs
All others
Other money market instruments
Certificates of deposit
Commercial paper
Bankers acceptances
8,264
14,539
11,475
14,507
13,176
13,663
12,162
8,814
7,010
18,995
16,273
-2,799
-10,045
-6,464
5,204
-1,572
-13,702 r
-10,785
5,795
804
-13,685 r
-13,207
6,617
2,004
-14,355
-13,701
6,647
4,193
-15,049
-14,535
6,%3
-303
-14,011
-12,729
8,356
-1,491
-15,442
-11,429
5,902
2,610
-11,986
-13,742
5,985
-3,377
-9,605
-14,128
4,893
1,837
-12,851
-7,500
3,918
-36
-15,583
-9,597
5,642
6,256
3,194
4,233
6,040
3,033
4,284r
6,685
2,955
4,190
4,688
3,102
3,806"
6,027
3,074
4,361
7,372
3,069
4,305
6,727
2,865
4,191
6,575
2,858
4,071
6,778
2,850
3,795
6,657
3,115
3,363
6,%3
3,262
3,406
30,749
23,366
29,518
27,455
32,278
26,559
18,616
31,859
28,245
26,362
39,763
26,100
32,132
25,901
33,058
27,055
22,742
28,469
32,924
27,048
35,699
24,480
3,734
5,542
978
3,852
6,389
1,053
3,501r
6,374
790
3,943
6,509
1,338
4,216
6,663
708
3,530
7,379
640
2,924
4,842
685
3,582
6,517
1,055
2,922
6,598
955
3,309
6,182
1,036
2,883
6,155
825
-6,189
-5,557
-2,336"
-2,894
-7,586
-4,607
1,221
259
861
1,760
3,670
1,543
3,030
399
-7,645
1,448
2,078r
526
-4,380
731
2,286
2,882
-4,237
309
2,129
2,463
-4,025
711
3,074
2,999
-3,479
291
1,814
1,617
-4,468
261
2,455
2,453
-4,552
1,140
2,319
3,861
-4,668
1,950
1,075
4,274
-3,731
2,894
1,155
2,620
-2,929
1,683
3,408
2,459
-4,550
FUTURES AND FORWARD POSITIONS5
By type of deliverable security
U.S. Treasury securities
14 Bills
Coupon securities, by maturity
15 Less than 3.5 years
16 3.5 to 7.5 years
17 7.5 to 15 years
18 15 years or more
Federal agency securities
Debt, maturing in
19
Less than 3.5 years
3.5 to 7.5 years
20
21
7.5 years or more
Mortgage-backed
Pass-throughs
22
23
All others
24 Certificates of deposit
3
-2
-20
-10
-73
-44
134
-21
-1
-58
-98
-8
136
-69
8
361
-62
59
77
16
-44
-1
27
-30
47
-15
3
-49
53
-60
-77
36
20
-18,255
5,955
-251,401
-13,731
6,241
-242,241
-14,399
5,757
-172,555
-1,599
4,272
-230,805
-11,667
6,120
-203,358
-23,833
6,299
-180,858
-13,734
6,162
-159,387
-13,037
5,716
-149,955
-3,487
2,7%
-164,770
-13,725
2,051
-145,399
-13,350
2,436
-119,575
Financing6
Reverse repurchase agreements
25 Overnight and continuing
26 Term
218,808
320,431
209,905
310,234
214,066
342,132
202,009
253,866
214,339
328,676
223,501
330,562
210,604
348,644
207,058
358,891
215,839
346,226
215,108
350,937
220,611
319,222
Repurchase agreements
27 Overnight and continuing
28 Term
361,098
300,209
369,411
285,332
383,324
317,708
351,100
234,258
379,870
299,232
399,164
303,155
388,641
322,762
373,574
343,621
364,770
322,515
373,293
324,063
390,803
299,795
Securities borrowed
29 Overnight and continuing
30 Term
97,726
40,171
100,438
42,957
101,102
44,528
92,827
40,774
97,890
43,698
100,174
43,066
104,332
44,878
101,570
47,240
102,129
42,728
102,475
44,206
107,833
42,295
Securities loaned
31 Overnight and continuing
32 Term
5,144r
1,4%
5,742
635
6,852
498
6,321
779
6,115
3,456
5,519
586
5,692
605
4,561
491
Collateralized loans
33 Overnight and continuing
5,791r
850"
6,163"
613
6,186"
1,269
19,635
17,750
17,160
18,419
17,536
16,833
16,527
18,243
15,992
15,387
16,502
MEMO: Matched book7
Reverse repurchase agreements
34 Overnight and continuing
35 Term
151,137
272,361
144,415
267,773
146,398
296,190
138,317
222,450
147,193
289,415
152,355
289,497
141,889
300,393
143,319
307,692
148,347
290,973
151,507
302,868
158,088
273,120
Repurchase agreements
36 Overnight and continuing
37 Term
182,822
229,511
188,263
215,9%
196,777
241,123
184,839
172,981
198,684
233,074
207,204
231,490
197,181
242,405
189,749
254,586
183,458
247,976
190,071
253,280
206,694
220,975
1. Data for positions and financing are obtained from reports submitted to the
Federal Reserve Bank of New York by the U.S. government securities dealers on
its published list of primary dealers. Weekly figures are close-of-business Wednesday data; monthly figures are averages of weekly data.
2. Securities positions are reported at market value.
3. Net immediate positions include securities purchased or sold (other than
mortgage-backed agency securities) that have been delivered or are scheduled to
be delivered in five business days or less and "when-issued" securities that settle
on the issue date of offering. Net immediate positions of mortgage-backed agency
securities include securities purchased or sold that have been delivered or are
scheduled to be delivered in thirty days or less.
4. Includes such securities as collateralized mortgage obligations (CMOs), real
estate mortgage investment conduits (REMICs), interest-only securities (IOs),
and principal-only securities (POs).
5. Futures positions are standardized contracts arranged on an exchange.
Forward positions reflect agreements made in the over-the-counter market that
specify delayed delivery. All futures positions are included regardless of time to
delivery. Forward contracts for U.S. Treasury securities and federal agency debt
securities are included when the time to delivery is more than five business days.
Forward contracts for mortgage-backed agency securities are included when the
time to delivery is more than thirty days.
6. Overnight financing refers to agreements made on one business day that
mature on the next business day; continuing contracts are agreements that remain
in effect for more than one business day but have no specific maturity and can be
terminated without advance notice by either party; term agreements have a fixed
maturity of more than one business day.
7. Matched-book data reflect financial intermediation activity in which the
borrowing and lending transactions are matched. Matched-book data are included
in the financing breakdowns given above. The reverse repurchase and repurchase
numbers are not always equal because of the "matching" of securities of different
values or types of collateralization.
NOTE. Data for futures and forward commercial paper and bankers acceptances and
for term financing of collateralized loans are no longer available because of insufficient
activity.
A32
1.44
Domestic Financial Statistics • February 1993
F E D E R A L A N D F E D E R A L L Y S P O N S O R E D CREDIT A G E N C I E S
Debt Outstanding
Millions of dollars, end of period
1992
1988
Agency
1 Federal and federally sponsored agencies
2 Federal agencies
3
Defense Department'
4
Export-Import Bank 2,3
5
Federal Housing Administration
6
Government National Mortgage Association certificates of
participation
7
Postal Service
8
Tennessee Valley Authority
9
United States Railway Association 6
10 Federally sponsored agencies 7
11
Federal Home Loan Banks
12 Federal Home Loan Mortgage Corporation
13 Federal National Mortgage Association
14
Farm Credit Banks 8
15
Student Loan Marketing Association
16 Financing Corporation 10
17
Farm Credit Financial Assistance Corporation
18 Resolution Funding Corporation
1989
1990
1991
May
June
July
Aug.
Sept.
381,498
411,805
434,668
442,772
449,787r
457,662r
457,369"
464,773"
475,606
35,668
8
11,033
150
35,664
7
10,985
328
42,159
7
11,376
393
41,035
7
9,809
397
40,535
7
8,644
427
40,388
7
8,156
432
39,773
7
8,156
194
40,034
7
8,156
229
41,319
7
7,698
301
0
6,142
18,335
0
0
6,445
17,899
0
0
6,948
23,435
0
0
8,421
22,401
0
0
9,771
21,686
0
0
10,123
21,670
0
0
10,123
21,293
0
0
10,123
21,519
0
0
10,123
23,190
0
345,832r
135,836
22,797
105,459
53,127
22,073
5,850
690
0
375,428r
136,108
26,148
116,064
54,864
28,705
8,170
847
4,522
392,509
117,895
30,941
123,403
53,590
34,194
8,170
1,261
23,055
401,737
107,543
30,262
133,937
52,199
38,319
8,170
1,261
29,9%
409,252r
106,368
27,612
144,655
52,080
38,885
8,170
1,261
29,9%
417,274r
106,050
32,479
149,013
51,805
38,020
8,170
1,261
29,9%
417,596"
107,343
33,959
147,377
49,241
39,765
8,170
1,261
29,9%
424,739"
108,564
34,295
150,280
52,137
39,552
8,170
1,261
29,9%
434,287
110,830
36,750
155,232
52,734
38,830
8,170
1,261
29,9%
142,850
134,873
179,083
185,576
179,617
180,848
177,700
174,003
164,422
11,027
5,892
4,910
16,955
0
10,979
6,195
4,880
16,519
0
11,370
6,698
4,850
14,055
0
9,803
8,201
4,820
10,725
0
8,638
9,551
4,820
9,025
0
8,150
9,903
4,820
9,025
0
8,150
9,903
4,820
8,475
0
8,150
9,903
4,820
7,275
0
7,692
9,903
4,820
7,175
0
58,496
19,246
26,324
53,311
19,265
23,724
52,324
18,890
70,896
48,534
18,562
84,931
45,434
18,473
83,676
44,784
18,199
85,%7
43,209
18,227
84,916
43,009
18,238
82,608
42,979
18,143
73,710
MEMO
19 Federal Financing Bank debt
20
21
22
23
24
Lending to federal and federally sponsored
Export-Import Bank
Postal Service 6
Student Loan Marketing Association
Tennessee Valley Authority
United States Railway Association 6
Other lending14
25 Farmers Home Administration
26 Rural Electrification Administration
27
agencies
1. Consists of mortgages assumed by the Defense Department between 1957
and 1963 under family housing and homeowners assistance programs.
2. Includes participation certificates reclassified as debt beginning Oct. 1, 1976.
3. On-budget since Sept. 30, 1976.
4. Consists of debentures issued in payment of Federal Housing Administration
insurance claims. Once issued, these securities may be sold privately on the
securities market.
5. Certificates of participation issued before fiscal year 1969 by the Government
National Mortgage Association acting as trustee for the Farmers Home Administration, the Department of Health, Education, and Welfare, the Department of
Housing and Urban Development, the Small Business Administration, and the
Veterans' Administration.
6. Off-budget.
7. Includes outstanding noncontingent liabilities: notes, bonds, and debentures. Some data are estimated.
g. Excludes borrowing by the Farm Credit Financial Assistance Corporation,
shown on line 17.
9. Before late 1982, the Association obtained financing through the Federal
Financing Bank (FFB). Borrowing excludes that obtained from the FFB, which is
shown on line 22.
10. The Financing Corporation, established in August 1987 to recapitalize the
Federal Savings and Loan Insurance Corporation, undertook its first borrowing in
October 1987.
11. The Farm Credit Financial Assistance Corporation, established in January
1988 to provide assistance to the Farm Credit System, undertook its first
borrowing in July 1988.
12. The Resolution Funding Corporation, established by the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, undertook its first
borrowing in October 1989.
13. The FFB, which began operations in 1974, is authorized to purchase or sell
obligations issued, sold, or guaranteed by other federal agencies. Because FFB
incurs debt solely for the purpose of lending to other agencies, its debt is not
included in the main portion of the table in order to avoid double counting.
14. Includes FFB purchases of agency assets and guaranteed loans; the latter
are loans guaranteed by numerous agencies, with the amounts guaranteed by any
one agency generally being small. The Farmers Home Administration entry
consists exclusively of agency assets, while the Rural Electrification Administration entry consists of both agency assets and guaranteed loans.
Securities Market and Corporate Finance
1.45
N E W SECURITY I S S U E S
A33
Tax-Exempt State and Local Governments
Millions of dollars
1992
Type of issue or issuer,
or use
1989
1 All issues, new and refunding1
113,646
1990
120,339
1991
Apr.
May
June
July
Aug.
154,402
16,922r
16,93?
24,084r
17,386r
19,774r
i s ,t a w
r
r
r
8,806
15,278r
r
7,136
lo^tr
r
7,005
12,769r
r
7,461
ll,237 r
7,733
13,359r
5,203
8,930
Sept.
Oct.
Nov.
14,133
ii,wr
By type of issue
2 General obligation
3 Revenue
35,774
77,873
39,610
81,295
55,100
99,302
5,251
ll,671 r
5,995
l O ^
By type of issuer
4 State
5 Special district or statutory authority
6 Municipality, county, or township
11,819
71,022
30,805
15,149
72,661
32,510
24,939
80,614
48,849
575
ll,583 r
4,764
1,165
11,03 l r
4,739
2,063
16,477r
5,544
2,836
10,040"^
4,510
2,933r
ll,203 r
n.a.
1,710
ll,054 r
5,934
2,742
13,113r
5,237
n.a.
n.a.
n.a.
7 Issues for new capital
84,062
103,235
116,953
9,020
9,259
14,096
7,565
11,993
10,496
13,760
8,028
15,133
6,870
11,427
16,703
5,036
28,894
17,042
11,650
11,739
23,099
6,117
34,607
21,121
13,395
21,039
25,648
8,376
30,275
2,208
921
1,380
2,582
558
1,371
1,651
1,669
771
2,045
133
2,990
2,132
2,618
1,851
4,266
724
2,505
1,747
571
629
887
91
3,640
1,737
2,130
2,604
767
503
4,252
1,237
1,977
2,265
1,869
1,176
1,972
2,083
1,364
3,340
2,365
367
4,241
1,800
531
960
1,070
581
3,086
8
9
10
11
12
13
By use of proceeds
Education
Transportation
Utilities and conservation
Social welfare
Industrial aid
Other purposes
1. Par amounts of long-term issues based on date of sale.
2. Since 1986, has included school districts.
1.46
N E W SECURITY I S S U E S
r
SOURCES. Investment Dealer's Digest beginning April 1990. Securities Data/
Bond Buyer Municipal Data Base beginning 1986. Public Securities Association
for earlier data.
U . S . Corporations
Millions of dollars
1992
Type of issue, offering,
or issuer
1989
1990
1991
Mar.
Apr.
May
June
July
Aug.
Sept.
Oct.
1 All issues1
377,836
339,052
465,389
38,303
28,948
44,947
47,985
46,170
36,855
42,917*
36,053
2 Bonds2
319,965
298,814
389,968
31,946
23,610
38,031
38,988
39,693
31,579
37,607*
29,087
By type of offering
3 Public, domestic
4 Private placement, domestic
5 Sold abroad
179,694
117,420
22,851
188,778
86,982
23,054
287,076
74,930
27,962
29,417
n.a.
2,529
22,236
n.a.
1,373
35,059
n.a.
2,972
35,960
n.a.
3,027
37,768
n.a.
1,924
28,325r
n.a.
3,254
36,300
n.a.
l,347 r
31,500
n.a.
2,000
74,736
50,268
10,221
18,611
9,276
156,853
51,779
40,719
12,776
17,621
6,687
169,231
86,627
36,681
13,598
23,949
9,431
219,682
8,955
3,670
641
1,896
725
16,060
4,170
2,351
140
3,462
1,205
12,282
6,046
2,472
621
3,041
1,590
24,261
7,263
1,630
899
4,251
1,028
23,916
5,509
3,476
766
6,909
2,081
20,951
4,720
2,230
393
4,401
1,053
18,783
5,884r
2,386r
677
5,218
1,156r
22,285
7,634
2,652
290
3,365
410
14,735
12 Stocks2
57,870
40,165
75,467
6,357
5,338
6,916
8,997
6,477
5,276
5,310
6,966
By type of offering
13 Public preferred
14 Common
15 Private placement 3
6,194
26,030
25,647
3,998
19,443
16,736
17,408
47,860
10,109
625
5,732
n.a.
334
5,004
n.a.
1,552
5,364
n.a.
2,916
6,081
n.a.
2,413
4,064
n.a.
1,148
4,129
n.a.
1,233
4,077
n.a.
2,901
4,065
n.a.
9,308
7,446
n.a.
3,090
n.a.
34,028
5,649
10,171
n.a.
416
n.a.
19,738
24,154
19,418
n.a.
3,474
n.a.
25,507
2,637
1,595
n.a.
704
n.a.
1,175
1,523
1,162
n.a.
577
n.a.
1,691
2,499
2,010
n.a.
826
n.a.
1,324
3,000
1,070
n.a.
610
n.a.
3,254
857
1,599
n.a.
564
n.a.
3,457
713
1,287
n.a.
921
n.a.
2,327
307
487
n.a.
595
n.a.
2,695
1,779
934
n.a.
359
n.a.
3,735
6
7
8
9
10
11
16
17
18
19
20
21
By industry group
Manufacturing
Commercial and miscellaneous
Transportation
Public utility
Communication
Real estate and financial
By industry group
Manufacturing
Commercial and miscellaneous
Transportation
Public utility
Communication
Real estate and financial
1. Figures represent gross proceeds of issues maturing in more than one year;
they are the principal amount or number of units calculated by multiplying by the
offering price. Figures exclude secondary offerings, employee stock plans,
investment companies other than closed-end, intracorporate transactions, equities sold abroad, and Yankee bonds. Stock data include ownership securities
issued by limited partnerships.
2. Monthly data cover only public offerings.
3. Monthly data are not available.
SOURCES. IDD Information Services, Inc., the Board of Governors of the
Federal Reserve System, and, before 1989, the U.S. Securities and Exchange
Commission.
A34
1.47
DomesticNonfinancialStatistics • February 1993
O P E N - E N D I N V E S T M E N T COMPANIES
Net Sales and Assets
Millions of dollars
1992
Item 1
1990
1991
Mar.
Apr.
May
June
July
Aug.
Sept/
Oct.
1 Sales of own shares 2
344,420
464,488
50,462
52,309
48,127
51,457
54,915
50,627
50,039
52,196
2 Redemptions of own shares
3 Net sales
288,441
55,979
342,088
122,400
35,464
14,998
39,302
13,007
31,409
16,718
37,457
14,000
34,384
20,703
35,223
15,404
37,862
12,177
37,180
15,016
4 Assets 4
568,517
807,001
848,842
870,011
897,211
911,218
951,806
957,145
978,507
980,943
5 Cash 5
6 Other
48,638
519,875
60,937
746,064
64,216
781,626
67,632
802,379
67,270
829,941
69,508
841,710
72,732
879,074
77,245
879,900
76,498
902,009
75,702
905,241
1. Data on sales and redemptions exclude money market mutual funds but
include limited-maturity municipal bond funds. Data on assets exclude both
money market mutual funds and limited-maturity municipal bond funds.
2. Includes reinvestment of dividends. Excludes reinvestment of capital gains
distributions.
3. Excludes sales and redemptions resulting from transfers of shares into or out
of money market mutual funds within the same fund family.
1.48
4. Market value at end of period, less current liabilities.
5. Includes all U.S. Treasury securities and other short-term debt securities.
SOURCE. Investment Company Institute. Data based on reports of membership,
which comprises substantially all open-end investment companies registered with
the Securities and Exchange Commission. Data reflect underwritings of new
companies.
CORPORATE PROFITS A N D THEIR DISTRIBUTION
Billions of dollars; quarterly data at seasonally adjusted annual rates
1991
1990
Account
1989
1990
1992
1991
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3 r
1 Profits with inventory valuation and
capital consumption adjustment
2 Profits before taxes
3 Profits tax liability
4 Profits after taxes
5
Dividends
6
Undistributed profits
362.8
342.9
141.3
201.6
134.6
67.1
361.7
355.4
136.7
218.7
149.3
69.4
346.3
334.7
124.0
210.7
146.5
64.2
344.0
354.7
133.7
221.0
151.9
69.1
349.6
337.6
121.3
216.3
150.6
65.7
347.3
332.3
122.9
209.4
146.2
63.2
341.2
336.7
127.0
209.6
145.1
64.5
347.1
332.3
125.0
207.4
143.9
63.4
384.0
366.1
136.4
229.7
143.6
86.2
388.4
376.8
144.1
232.7
146.6
86.1
374.1
354.1
131.8
222.2
151.1
71.1
7 Inventory valuation
8 Capital consumption adjustment
-17.5
37.4
-14.2
20.5
3.1
8.4
-21.2
10.5
6.7
5.3
9.9
5.1
-4.8
9.3
.7
14.1
-5.4
23.3
-15.5
27.0
-9.7
29.7
SOURCE. U.S. Department of Commerce, Survey of Current
1.50
Business.
N O N F A R M B U S I N E S S E X P E N D I T U R E S on N e w Plant and Equipment
Billions of dollars; quarterly data at seasonally adjusted annual rates
1991
Industry
1990
1991
1992
19921
Ql
Q2
Q3
Q4
Ql
Q2
Q3
Q4 1
1 Total nonfarm business
532.61
528.39
551.03
534.27
525.02
526.59
529.87
535.72
540.91
565.16
562.36
Manufacturing
2 Durable goods industries
3 Nondurable goods industries
82.58
110.04
77.64
105.17
75.70
101.72
80.99
109.84
79.31
107.20
74.94
102.55
76.40
102.66
74.19
99.79
74.26
97.52
76.10
106.69
78.25
102.86
9.88
10.02
9.21
9.94
10.08
10.09
9.99
8.87
9.18
9.76
9.01
6.40
8.87
6.20
5.95
10.17
6.54
6.74
9.58
7.34
5.68
10.89
6.41
6.25
9.95
6.67
6.32
9.61
6.63
5.44
10.41
6.45
6.65
8.86
6.37
6.50
9.75
7.27
7.08
9.60
7.77
6.74
10.12
7.95
44.10
23.11
241.43
43.76
22.82
246.32
48.85
23.85
268.05
43.62
23.40
243.51
43.09
22.00
240.46
43.27
23.25
249.94
44.75
22.67
251.11
46.06
22.75
262.17
48.45
24.19
263.80
50.16
24.37
273.62
50.74
24.11
272.59
Nonmanufacturing
4 Mining
Transportation
5
Railroad
6
Air
7
Other
Public utilities
8
Electric
9
Gas and other
10 Commercial and other 2
1. Figures are amounts anticipated by business.
2. " O t h e r " consists of construction, wholesale and retail trade, finance and
insurance, personal and business services, and communication.
SOURCE. U.S. Department of Commerce, Survey of Current
Business.
Securities Markets and Corporate Finance
1.51
DOMESTIC FINANCE COMPANIES
A35
Assets and Liabilities
Billions of dollars, end of period; not seasonally adjusted
1990
Account
1989
1990
1991
1992
1991
Q4
Ql
Q2
Q3
Q4
Ql
Q2
ASSETS
1 Accounts receivable, gross 1
2 Consumer
3 Business
4 Real estate
462.9
138.9
270.2
53.8
492.9
133.9
293.5
65.5
480.3
121.9
292.6
65.8
492.9
133.9
293.5
65.5
482.9
127.1
291.7
64.1
488.5
127.5
295.2
65.7
484.7
125.3
293.2
66.2
480.3
121.9
292.6
65.8
475.7
118.4
291.6
65.8
477.0
116.7
293.9
66.4
54.7
8.4
57.6
9.6
55.1
12.9
57.6
9.6
57.2
10.7
58.0
11.1
57.6
13.1
55.1
12.9
53.6
13.0
51.2
12.3
7 Accounts receivable, net
8 All other
399.8
102.6
425.7
113.9
412.3
149.0
425.7
113.9
415.0
118.7
419.3
122.8
414.1
136.4
412.3
149.0
409.1
145.5
413.6
139.4
9 Total assets
502.4
539.6
561.2
539.6
533.7
542.1
550.5
561.2
554.6
553.0
10 Bank loans
11 Commercial paper
27.0
160.7
31.0
165.3
42.3
159.5
31.0
165.3
35.6
155.5
36.9
156.1
39.6
156.8
42.3
159.5
38.0
154.4
37.8
147.7
Debt
12 Other short-term
13 Long-term
14 Owed to parent
15 Not elsewhere classified
16 All other liabilities
17 Capital, surplus, and undivided profits
n.a.
n.a.
35.2
162.7
61.5
55.2
n.a.
n.a.
37.5
178.2
63.9
63.7
n.a.
n.a.
34.5
191.3
69.0
64.8
n.a.
n.a.
37.5
178.2
63.9
63.7
n.a.
n.a.
32.4
182.4
64.3
63.4
n.a.
n.a.
34.2
184.5
67.1
63.3
n.a.
n.a.
36.5
185.0
68.8
63.8
n.a.
n.a.
34.5
191.3
69.0
64.8
n.a.
n.a.
34.5
189.8
72.0
66.0
n.a.
n.a.
34.8
191.9
73.4
67.1
18 Total liabilities and capital
502.4
539.6
561.2
539.6
533.7
542.1
550.5
561.2
554.6
548.4
5 LESS: Reserves for unearned income
6
Reserves for losses
LIABILITIES AND CAPITAL
1.52
DOMESTIC FINANCE COMPANIES
Business Credit Outstanding1
Millions of dollars, end of period
1992
Type of credit
1989
1990
May
June
July
Aug.
Sept/
Oct.
Seasonally Adjusted
1 Total
2 Consumer
, 3 Real estate 2
4 Business
481,436
523,023
519,573
519,668
520,804
522,834
528,117
527,858
525,241
157,766
53,518
270,152
161,070
65,147
296,807
154,786
65,388
299,400
154,989
66,898
297,781
154,850
66,433
299,521
153,588
66,843
302,403
154,729
67,753
305,634
155,618
67,717
304,523
152,658
68,035
304,549
Not Seasonally Adjusted
5
6 Consumer
7
Motor vehicles
8 Other consumer
9
Securitized motor vehicles
10 Securitized other consumer
11 Real estate
12 Business
13 Motor vehicles
14
Retail 5 .
15
Wholesale 6
16
Leasing
17 Equipment
18
Retail
19
Wholesale 6
20
Leasing
21
Other business
22
Securitized business assets
Retail
23
24
Wholesale
25
Leasing
484,566
526,441
522,853
520,682
524,587
522,686
523,448
524,999
524,782
158,542
84,126
54,732
13,690
5,994
53,781
272,243
90,416
29,505
34,093
26,818
122,246
29,828
6,452
85,966
57,560
n.a.
710
n.a.
1,311
161,965
75,045
58,818
19,837
8,265
65,509
298,967
92,072
26,401
33,573
32,098
137,654
31,968
11,101
94,585
63,774
5,467
667
3,281
1,519
155,677
63,413
58,488
23,166
10,610
65,764
301,412
90,319
22,507
31,216
36,596
141,399
30,962
9,671
100,766
60,887
8,807
576
5,285
2,946
154,414
59,399
56,740
26,529
11,746
66,650
299,618
88,585
20,143
30,893
37,549
143,431
31,569
9,116
102,746
59,291
8,311
196
5,147
2,968
154,859
60,056
56,634
26,195
11,974
66,437
303,291
90,075
20,674
30,505
38,896
145,994
32,610
9,194
104,190
57,586
9,636
178
5,231
4,227
154,099
60,400
56,568
25,392
11,739
67,065
301,522
87,686
21,086
27,158
39,443
145,787
32,370
9,128
104,289
59,099
8,951
170
4,649
4,132
155,529
60,393
56,782
26,852
11,503
68,104
299,815
85,745
20,743
n.a.
39,889
145,790
32,250
9,084
104,455
59,013
9,268
158
5,193
3,917
156,416
59,806
56,808
28,204
11,598
68,064
300,519
85,261
20,407
n.a.
39,506
147,319
31,571
8,994
106,754
58,493
9,447
152
5,378
3,917
153,650
59,290
55,412
27,823
11,124
68,477
302,656
86,747
20,763
n.a.
39,536
147,146
31,475
8,928
106,743
58,661
10,101
634
5,593
3,874
1. Includes finance company subsidiaries of bank holding companies but not of
retailers and banks. Data are before deductions for unearned income and losses.
Data in this table also appear in the Board's G.20 (422) monthly statistical release.
For ordering address, see inside front cover.
2. Includes all loans secured by liens on any type of real estate, for example,
first and junior mortgages and home equity loans.
3. Includes personal cash loans, mobile home loans, and loans to purchase other
types of consumer goods such as appliances, apparel, general merchandise, and
recreation vehicles.
4. Outstanding balances of pools upon which securities have been issued; these
for FRASER
balances are no longer carried on the balance sheets of the loan originator.
Digitized
5. Passenger car fleets and commercial land vehicles for which licenses are
required.
6. Credit arising from transactions between manufacturers and dealers, that is,
floor plan financing.
7. includes loans on commercial accounts receivable, factored commercial
accounts, and receivable dealer capital; small loans used primarily for business or
farm purposes; and wholesale and lease paper for mobile homes, campers, and
travel trailers.
A36
1.53
DomesticNonfinancialStatistics • February 1993
MORTGAGE M A R K E T S Conventional Mortgages on N e w Homes
Millions of dollars except as noted
1992
Item
1989
1990
1991
May
June
July
Aug.
Sept.
Oct.
Nov.
Terms and yields in primary and secondary markets
PRIMARY MARKETS
1
2
3
4
5
6
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)
Contract rate (percent per year)
Yield (percent per year)
.'
7 OTS series
8 HUD series 4
159.6
117.0
74.5
28.1
2.06
9.76
153.2
112.4
74.8
27.3
1.93
9.68
155.0
114.0
75.0
26.8
1.71
9.02
158.7
119.7
77.3
26.4
1.69
8.30
154.4
116.1
77.3
25.0
1.57
8.15
173.5
132.6
77.5
26.4
1.19
7.81
148.4
113.6
78.7
24.8
1.62
7.72
146.0
109.3
77.0
25.7
1.52
7.68
159.2
119.7
77.3
25.2
1.42
7.65
165.4
117.3
75.3
24.9
1.54
7.81
10.11
10.21
10.01
10.08
9.30
9.20
8.59
8.66
8.43
8.42
8.00
8.14
8.00
8.01
7.93
7.95
7.90
8.29
8.07
8.38
10.24
9.71
10.17
9.51
9.25
8.59
8.66
8.00
8.56
7.90
8.12
7.63
8.08
7.28
8.06
7.31
8.29
7.53
8.54
7.90
SECONDARY MARKETS
Yield (percent per year)
9 FHA mortgages (HUD series)
10 GNMA securities 6
Activity in secondary markets
FEDERAL NATIONAL MORTGAGE ASSOCIATION
Mortgage holdings (end of period)
11 Total
12 FHA/VA-insured
13 Conventional
Mortgage transactions (during period)
14 Purchases
Mortgage commitments
15 Issued 8
16 To sell9
104,974
19,640
85,335
113,329
21,028
92,302
122,837
21,702
101.135
140,899
21,924
118,975
142,148
22,218
119,930
142,465
22,263
120,202
142,246
22,199
120,047
144,904
22,275
122,629
149,133
22,399
126,734
153,306
22,372
130,934
22,518
23,959
37,202
5,576
5,809
4,191
3,651
6,779
8,380
7,980
n.a.
n.a.
23,689
5,270
40,010
7,608
4,392
1,695
4,662
1,831
4,663
807
6,053
10
8,880
148
8,195
0
6,084
237
20,105
590
19,516
20,419
547
19,871
24,131
484
23,283
28,710
432
28,278
28,621
426
28,195
28,510
419
28,091
29,367
376
28,990
31,629
371
31,259
32,995
365
32,630
n.a.
n.a.
n.a.
78,588
73,446
75,517
73,817
97,727
92,478
16,405
17,214
14,222
13,740
12,172
11,849
13,562
12,314
16,391
14,267
20,199
18,771
n.a.
18,782
88,519
102,401
114,031
13,334
19,114
26,488
14,212
17,132
27,380
n.a.
(during period?
FEDERAL HOME LOAN MORTGAGE CORPORATION
Mortgage holdings (end of period)9
17 Total
18 FHA/VA-insured
19 Conventional
Mortgage transactions (during period)
20 Purchases
21 Sales
Mortgage commitments
22 Contracted
10
(during period)
1. Weighted averages based on sample surveys of mortgages originated by
major institutional lender groups; compiled by the Federal Housing Finance
Board in cooperation with the Federal Deposit Insurance Corporation.
2. Includes all fees, commissions, discounts, and "points" paid (by the
borrower or the seller) to obtain a loan.
3. Average effective interest rates on loans closed, assuming prepayment at
the end of ten years; from Office of Thrift Supervision (OTS).
4. Average contract rates on new commitments for conventional first mortgages; from U.S. Department of Housing and Urban Development (HUD).
5. Average gross yields on thirty-year, minimum-downpayment, first mortgages insured by the Federal Housing Administration (FHA) for immediate
delivery in the private secondary market. Based on transactions on first day of
subsequent month. Large monthly movements of average yields may reflect
market adjustments to changes in maximum permissible contract rates.
6. Average net yields to investors on fully modified pass-through securities
backed by mortgages and guaranteed by the Government National Mortgage
Association (GNMA), assuming prepayment in twelve years on pools of thirtyyear mortgages insured by the Federal Housing Administration or guaranteed by
the Department of Veterans Affairs carrying the prevailing ceiling rate. Monthly
figures are averages of Friday figures from the Wall Street Journal.
7. Includes some multifamily and nonprofit hospital loan commitments in
addition to one- to four-family loan commitments accepted in the Federal National
Mortgage Association's (FNMA's) free market auction system, and through the
FNMA-GNMA tandem plans.
8. Does not include standby commitments issued, but includes standby
commitments converted.
9. Includes participation loans as well as whole loans.
10. Includes conventional and government-underwritten loans. The Federal
Home Loan Mortgage Corporation's mortgage commitments and mortgage transactions include activity under mortgage securities swap programs, while the
corresponding data for FNMA exclude swap activity.
Real Estate
A37
MORTGAGE D E B T O U T S T A N D I N G 1
1.54
Millions of dollars, end of period
1992
1991
Type of holder and property
1 All
2
3
4
5
holders
By type of property
One- to four-family residences
Multifamily residences
Commercial
Farm
By type of holder
6 Major financial institutions
7
Commercial banks
8
One- to four-family
9
Multifamily
Commercial
10
11
Farm
12
Savings institutions 3
13
One- to four-family
14
Multifamily
15
Commercial
16
Farm
17
Life insurance companies
18
One- to four-family
19
Multifamily
20
Commercial
21
Farm
Finance companies 4
1988
1989
1990
Q2
Q3
Q4
Ql
Q2 P
3,275,697
3,561,685
3,807,306
3,898,924
3,912,518
3,927,396
3,971,687
3,999,102
2,203,973
292,590
693,888
85,247
2,432,222
304,612
740,826
84,025
2,649,436
310,619
763,281
83,969
2,726,425
315,404
773,315
83,779
2,758,976
308,047
762,330
83,165
2,781,078
308,844
754,300
83,173
2,833,365
308,510
746,902
82,910
2,873,755
301,007
740,760
83,579
1,831,472
674,003
334,367
33,912
290,254
15,470
924,606
671,722
110,775
141,433
676
232,863
11,164
24,560
187,549
9,590
1,931,537
767,069
389,632
38,876
321,906
16,656
910,254
669,220
106,014
134,370
650
254,214
12,231
26,907
205,472
9,604
1,914,315
844,826
455,931
37,015
334,648
17,231
801,628
600,154
91,806
109,168
500
267,861
13,005
28,979
215,121
10,756
1,898,492
871,416
476,363
37,564
339,450
18,039
755,403
570,015
86,483
98,457
448
271,674
11,743
30,006
219,204
10,721
1,860,710
870,937
478,851
36,398
337,365
18,323
719,679
547,799
81,883
89,595
402
270,094
11,720
29,962
218,179
10,233
1,846,910
876,284
486,572
37,424
333,852
18,436
705,367
538,358
79,881
86,741
388
265,258
11,547
29,562
214,105
10,044
1,825,983
880,377
492,910
37,710
330,837
18,919
682,338
524,536
77,166
80,278
358
263,269
11,214
29,693
212,865
9,497
1,807,045
884,598
496,518
38,314
330,229
19,538
660,547
509,397
74,837
75,969
345
261,900
11,087
29,745
211,913
9,155
37,846
45,476
48,777
48,972
50,658
51,567
50,573
55,933
23 Federal and related agencies
24
Government National Mortgage Association
25
One- to four-family
26
Multifamily
27
Farmers Home Administration
28
One- to four-family
29
Multifamily
30
Commercial
31
Farm
32
Federal Housing and Veterans' Administrations
33
One- to four-family
34
Multifamily
35
Federal National Mortgage Association
36
One- to four-family
37
Multifamily
38
Federal Land Banks
39
One- to four-family
40
Farm
41
Federal Home Loan Mortgage Corporation
42
One- to four-family
43
Multifamily
200,570
26
26
0
42,018
18.347
8,513
5,343
9,815
5,973
2,672
3,301
103,013
95,833
7,180
32,115
1,890
30,225
17,425
15,077
2,348
209,498
23
23
0
41,176
18,422
9,054
4,443
9,257
6,087
2,875
3,212
110,721
102,295
8,426
29,640
1,210
28,430
21,851
18,248
3,603
250,761
20
20
0
41,439
18,527
9,640
4,690
8,582
8,801
3,593
5,208
116,628
106,081
10,547
29,416
1,838
27,577
21,857
19,185
2,672
276,797
20
20
0
41,430
18,521
9,898
4,750
8,261
10,210
3,729
6,480
122,806
111,560
11,246
29,152
2,041
27,111
23,649
21,120
2,529
282,115
20
20
0
41,566
18,598
9,990
4,829
8,149
10,057
3,649
6,408
125,451
113,696
11,755
29,053
2,124
26,929
23,906
21,489
2,417
282,856
19
19
0
41,713
18,496
10,141
4,905
8,171
10,733
4,036
6,697
128,983
117,087
11,896
28,777
1,693
27,084
26,809
24,125
2,684
2%,664
19
19
0
41,791
18,488
10,270
4,961
8,072
11,332
4,254
7,078
136,506
124,137
12,369
28,776
1,693
27,083
28,895
26,182
2,713
297,618
23
23
0
41,628
17,718
10,356
4,998
8,557
11,798
4,124
7,674
142,148
129,392
12,756
28,775
1,693
27,082
28,621
26,001
2,620
44 Mortgage pools or trusts 6
Government National Mortgage Association
45
46
One- to four-family
47
Multifamily
48
Federal Home Loan Mortgage Corporation
49
One- to four-family
50
Multifamily
51
Federal National Mortgage Association
52
One- to four-family
Multifamily
,
53
54
Farmers Home Administration
55
One- to four-family
56
Multifamily
Commercial
57
58
Farm
811,847
340,527
331,257
9,270
226,406
219,988
6,418
178,250
172,331
5,919
104
26
0
38
40
946,766
368,367
358,142
10,225
272,870
266,060
6,810
228,232
219,577
8,655
80
21
0
26
33
1,110,555
403,613
391,505
12,108
316,359
308,369
7,990
299,833
291,194
8,639
66
17
0
24
26
1,188,626
416,082
403,679
12,403
341,132
332,624
8,509
331,089
322,444
8,645
55
13
0
21
21
1,229,836
422,500
412,715
9,785
348,843
341,183
7,660
351,917
343,430
8,487
52
12
0
20
20
1,262,685
425,295
415,767
9,528
359,163
351,906
7,257
371,984
362,667
9,317
47
11
0
19
17
1,302,217
421,977
412,574
9,404
367,878
360,887
6,991
389,853
380,617
9,236
43
10
0
18
16
1,339,172
422,922
413,828
9,094
382,797
376,177
6,620
413,226
403,940
9,286
43
9
0
18
15
59 Individuals and others 7
60
One- to four-family
61
Multifamily
62
Commercial
63
Farm
431,808
262,713
80,394
69,270
19,431
473,884
297,050
82,830
74,609
19,395
531,674
333,532
87,950
90,894
19,298
535,009
333,256
87,002
95,573
19,178
539,858
336,711
87,351
96,687
19,109
534,945
330,062
87,440
98,409
19,034
546,823
340,561
86,975
100,321
18,966
555,267
348,631
86,390
101,358
18,887
22
1. Based on data from various institutional and governmental sources; figures
for some quarters estimated in part by the Federal Reserve. Multifamily debt
refers to loans on structures of five or more units.
2. Includes loans held by nondeposit trust companies but not loans held by
bank trust departments.
3. Includes savings banks and savings and loan associations. Beginning 1987:1,
data reported by institutions insured by the Federal Savings and Loan Insurance
Corporation include loans in process and other contra-assets (credit balance
accounts that must be subtracted from the corresponding gross asset categories to
yield net asset levels).
4. Assumed to be entirely loans on one- to four-family residences.
5. Securities guaranteed by the Fanners Home Administration (FmHA) sold to
the Federal Financing Bank were reallocated from F m H A mortgage pools to
FmHA mortgage holdings in 1986:4 because of accounting changes by the F m H A .
6. Outstanding principal balances of mortgage-backed securities insured or
guaranteed by the agency indicated. Includes private pools, which are not shown
as a separate line item.
7. 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 other U.S. agencies.
A38
DomesticNonfinancialStatistics • February 1993
1.55
C O N S U M E R I N S T A L L M E N T CREDIT Total Outstanding 1
Millions of dollars, amounts outstanding, end of period
1992
Holder and type of credit
1989
1990
1991
May
June
July
Aug.
Sept. r
Oct.
Seasonally adjusted
1 Total
716,825
735,338
727,799
722,928
722,919
721,820
720,664
722,104
722,317
2 Automobile
3 Revolving
4 Other
292,002
199,308
225,515
284,993
222,950
227,395
263,003
242,785
222,012
259,834
246,220
216,874
257,339
247,418
218,162
257.743
247,332
216.744
256,944
248,043
215,677
257,384
250,017
214,703
257,412
251,653
213,252
Not seasonally adjusted
5 Total
728,877
748,524
742,058
718,420
719,845
718,599
721,985
724,198
722,700
By major holder
Commercial banks
Finance companies
Credit unions
Retailers
Savings institutions
Gasoline companies
Pools of securitized assets 2 .
342,770
138,858
93,114
44,154
57,253
3,935
48,793
347,087
133,863
93,057
44,822
46,969
4,822
77,904
339,565
121,901
92,254
44,030
40,315
4,362
99,631
324,791
116,138
91,605
37,824
36,224
4,193
107,645
324,171
116,690
92,340
37,438
35,782
4,360
109,064
323,899
117,002
91,778
37,219
35,552
4,506
108,643
323,866
117,175
92,270
38,791
35,378
4,542
109,963
324,046
116,650
92,698
38,778
35,069
4,499
112,458
324,424
114,702
92,941
39,299
34,681
4,452
112,201
By major type of credit3
13 Automobile
14
Commercial banks
15
Finance companies
16
Pools of securitized assets'
292,060
126,288
84,126
18,185
285,050
124,913
75,045
24,428
263,108
111,912
63,413
28,057
258,665
108,610
59,399
31,406
257,442
106,645
60,056
31,024
258,104
107,722
60,400
30,454
259,128
107,978
60,393
30,826
260,395
108,355
59,806
31,971
259,626
108,105
59,290
31,757
17 Revolving
18
Commercial banks
19
Retailers
20
Gasoline companies
21
Pools of securitized assets'
210,310
130,811
39,583
3,935
23,477
235,056
133,385
40,003
4,822
44,335
255,895
137,968
39,352
4,362
60,139
243,315
128,013
33,245
4,193
63,801
245,092
127,925
32,844
4,360
65,784
244,661
127,476
32,617
4,506
65,791
247,051
126,922
34,167
4,542
66,985
248,692
127,234
34,148
4,499
68,252
249,715
127,263
34,654
4,452
68,699
22 Other
23
Commercial banks
24
Finance companies
25
Retailers
26
Pools of securitized assets 2
226,507
85,671
54,732
4,571
7,131
228,418
88,789
58,818
4,819
9,141
223,055
89,685
58,488
4,678
11,435
216,440
88,168
56,739
4,579
12,438
217,311
89,601
56,634
4,594
12,256
215,834
88,701
56,602
4,602
12,398
215,806
88,966
56,782
4,624
12,152
215,111
88,457
56,844
4,630
12,235
213,359
89,056
55,412
4,645
11,745
6
7
8
9
10
11
12
1. The Board's series on amounts of credit covers most short- and intermediate-term credit extended to individuals that is scheduled to be repaid (or has the
option of repayment) in two or more installments.
Data in this table also appear in the Board's G.19 (421) monthly statistical
release. For ordering address, see inside front cover.
1.56
2. Outstanding balances of pools upon which securities have been issued; these
balances are no longer carried on the balance sheets of the loan originator.
3. Totals include estimates for certain holders for which only consumer credit
totals are available.
TERMS OF C O N S U M E R I N S T A L L M E N T CREDIT 1
Percent per year except as noted
1992
1990
Apr.
May
June
July
Aug.
Sept.
9.52
14.28
17.97
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
9.15
13.94
12.57
17.66
n.a.
n.a.
n.a.
n.a.
Oct
INTEREST RATES
1
2
3
4
Commercial
banks2
48-month new car
24-month personal
^
120-month mobile home
Credit card
Auto finance
5 New car
6 Used car
companies
12.07
15.44
14.11
18.02
11.78
15.46
14.02
18.17
11.14
15.18
13.70
18.23
n.a.
n.a.
n.a.
n.a.
12.62
16.18
12.54
15.99
12.41
15.60
10.84
14.14
10.67
14.01
10.24
13.89
9.94
13.67
13.49
8.65
13.44
54.2
46.6
54.6
46.0
55.1
47.2
54.5
47.8
54.7
47.9
54.4
48.0
54.4
48.0
53.6
47.9
53.3
47.7
12,001
7,954
12,071
8,289
12,494
13,208
8,905
13,373
9,247
13,369
9,201
13,570
9,293
13,745
9,238
13,889
8,402
12.82
OTHER TERMS 4
Maturity
(months)
7 New car
8 Used car
Loan-to-value
9 New car
10 Used car
ratio
Amount financed
11 New car
12 Used car
(dollars)
1. Data in this table also appear in the Board's G.19 (421) monthly statistical
release. For ordering address, see inside front cover.
2.
Data are available for only the second month of each quarter.
FRASER
Digitized for
3. Before 1983 the maturity for new car loans was 36 months, and for mobile
home loans was 84 months.
4. At auto finance companies.
Flow of Funds
1.57
A39
F U N D S RAISED IN U.S. CREDIT MARKETS 1
Billions of dollars; quarterly data at seasonally adjusted annual rates
1992
1991
Ql
Q2
Q3
Q4
Ql"
Q2"
Q3
Nonfinancial sectors
r
455.4
543.3r
405.6"
406.3"
667.5
535.1
379.9
278.2
292.0
-13.8
227.4
251.4
-24.0
276.7
282.9
-6.2
288.4
317.2
-28.8
320.4
316.6
3.8
368.9
380.1
-11.2
351.9
351.5
.4
193.4
184.4
9.0
85.9"
298.6
183.2
186.5
1 Total net borrowing by domestic nonfinancial sectors ..
721.2
775.8
740.8
665.0
452.7
By sector and instrument
2 U.S. government
3 Treasury securities
4 Agency issues and mortgages
143.9
142.4
1.5
155.1
137.7
17.4
146.4
144.7
1.6
246.9
238.7
8.2
5 Private
577.3
620.7
594.4
418.2
174.4r
228.0
266.6r
6
7
8
9
10
11
12
13
14
15
16
17
18
By instrument
Debt capital instruments
Tax-exempt obligations
Corporate bonds
Mortgages
Home mortgages
Multifamily residential
Commercial
Farm
Other debt instruments
Consumer credit
Bank loans n.e.c
Open market paper
Other
487.2
83.5
78.8
325.0
235.3
24.4
71.6
-6.4
90.1
32.9
9.9
1.6
45.7
474.1
53.7
103.1
317.3
241.8
16.7
60.8
-2.1
146.6
50.1
41.0
11.9
43.6
441.8
65.0
73.8
303.0
245.3
16.4
42.7
-1.5
152.6
41.7
40.2
21.4
49.3
342.3
51.2
47.1
244.0
219.4
3.7
21.0
-.1
75.8
17.5
4.4
9.7
44.2
254.6r
45.8
78.8r
130.0
142.2
-2.0
-9.4
-.8
-80.2
-12.5
-33.4
-18.4
-15.8
296. l r
35.6
76.7
183.8r
153.0
6.3r
24.6r
-.1
-68.0
-10.4
-15.0
-14.3
-28.3
329.9"
48.5
96.5
184.8r
158.1
12.5r
14.9"
-.7
-63.3
-7.8
-34.5
-15.9
-5.2
182.0"
210.6"
53.5
45.5
81.7
60.3"
46.8"
104.8
122.4
135.1
-29.4"
2.7
-43.8"
-33.1
-2.5
.0
- 6 4 . 8 -124.7
-24.0
-8.0
-18.2
-66.1
-36.3
-7.0
13.7
-43.6
312.9
52.0
76.3
184.7
209.6
-1.3
-22.6
-1.1
-14.4
3.1
-26.9
12.6
-3.2
218.4
73.0
77.5
67.9
121.6
-31.6
-24.9
2.7
-35.2
-12.4
-21.5
-3.4
2.1
196.4
52.3
61.3
82.8
147.2
-10.7
-54.7
1.1
-10.0
.4
-23.3
1.7
11.2
19
20
21
22
23
24
By borrowing sector
State and local government
Household
Nonfinancial business
Farm
Nonfarm noncorporate
Corporate
83.0
296.4
197.8
-10.6
65.3
143.1
48.9
318.6
253.1
-7.5
61.8
198.8
63.2
305.6
225.6
1.6
50.4
173.6
48.3
254.2
115.6
2.5
26.7
86.4
38.5
158.0
- 2 2 . lr
.9
-23.6
,6r
36.0
160.8
31.2r
3.9
13.2
14.0
38.6
188.8
39.2r
2.1
9.8
27.2r
37.6
41.9
136.1
146.3
-56.5" -102.4"
-.3
-2.2
-65.9
-51.5
9.7" -48.7"
46.1
217.1
35.4
-1.6
-20.7
57.7
63.4
143.3
-23.4
7.1
-65.6
35.2
50.0
148.1
-11.7
2.4
-51.4
37.4
25 Foreign net borrowing in United States
26
Bonds
27
Bank loans n.e.c
28
Open market paper
29
U.S. government loans
6.2
7.4
-3.6
3.8
-1.4
6.4
6.9
-1.8
8.7
-7.5
10.2
4.9
-.1
13.1
-7.6
23.9
21.4
-2.9
12.3
-6.9
14.1
14.9
3.1
6.4
-10.2
63.1
11.1
8.1
46.7
-2.8
-63.2
10.6
-3.5
-51.9
-18.3
15.6
15.5
1.4
16.0
-17.2
41.0
22.3
6.5
14.9
-2.7
9.9
4.9
1.5
-7.8
11.4
55.9
22.8
14.1
27.7
-8.8
30.1
23.2
3.4
12.8
-9.3
30 Total domestic plus foreign
727.4
782.2
750.9
688.9
466.8r
518.5
480.1"
421.2"
447.3"
677.3
591.0
410.1
117.2"
Financial sectors
31 Total net borrowing by financial sectors
259.0
211.4
220.1
187.1
139.2
108.9
104.0"
143.4"
200.5
108.9
218.4
246.2
By instrument
U.S. government-related
Sponsored-credit-agency securities
Mortgage pool securities
Loans from U.S. government
171.8
30.2
142.3
-.8
119.8
44.9
74.9
.0
151.0
25.2
125.8
.0
167.4
17.1
150.3
-.1
147.7
9.2
138.6
.0
154.6
13.1
141.5
.0
127.4
-29.7
157.1
.0
156.3
20.6
135.8
.0
152.7
32.6
120.1
-.1
126.8
11.5
115.3
.0
199.5
48.3
151.2
.0
152.9
62.3
90.6
.0
36 Private
37 Corporate bonds
38 Mortgages
39
Bank loans n.e.c
40
Open market paper
41
Loans from Federal Home Loan Banks
87.2
39.1
.4
-3.6
26.9
24.4
91.7
16.2
.3
.6
54.8
19.7
69.1
46.8
.0
1.9
31.3
-11.0
19.7
34.4
.3
1.2
8.6
-24.7
-8.6
57.7
.6
3.2
-32.0
-38.0
-45.7
41.4
• lr
1.0
-52.5
-35.8
-23.4"
72.4"
.9"
-2.9
-46.0
-47.7
-12.9"
29.5"
-.2"
10.2
-16.7
-35.7
47.8
87.5
1.5
4.5
-12.7
-33.0
-17.9
-25.1
.9
8.2
7.6
-9.5
18.9
25.5
.1
3.9
-16.3
5.7
93.2
54.5
.1
5.5
11.8
21.3
By borrowing sector
42 Sponsored credit agencies
43 Mortgage pools
44 Private
45
Commercial banks
46
Bank affiliates
47
Savings and loan associations
48
Mutual savings banks
49
Finance companies
50
Real estate investment trusts (REITs)
Securitized credit obligation (SCO) issuers
51
29.5
142.3
87.2
6.2
14.3
19.6
8.1
-.5
.4
39.1
44.9
74.9
91.7
-3.0
5.2
19.9
1.9
31.5
3.6
32.5
25.2
125.8
69.1
-1.4
6.2
-14.1
-1.4
59.7
-1.9
22.0
17.0
150.3
19.7
-1.1
-27.7
-29.9
-.5
35.6
-1.9
45.2
9.1
138.6
-8.6
-13.3
-2.5
-39.5
-3.5
14.5
.0
35.6
13.1
141.5
-45.7
-18.4
-9.3
-42.9
2.0
-10.3
.1
33.2
-29.7
157.1
-23.4"
-11.7
-3.5
-48.7
-1.7
3.4
.1"
38.7
20.6
135.8
-12.9"
-9.2
-6.8
-41.1
-5.5
12.2
-.9"
38.5
32.5
120.1
47.8
-14.1
9.6
-25.1
-8.7
52.9
.8
32.3
11.5
115.3
-17.9
7.2
2.7
-20.3
4.3
-39.0
4.6
22.5
48.3
151.2
18.9
.8
-8.2
2.7
.3
-20.9
.9
43.2
62.3
90.6
93.2
1.6
2.2
10.1
8.3
34.6
-.7
37.1
32
33
34
35
A40
DomesticNonfinancialStatistics • February 1993
1.57—Continued
1992
1991
Transaction category or sector
1987
1988
1989
1990
1991
Ql
Q2
Q3
Q4
Qlr
Q2r
Q3
564.6r
647.7'
786.2
809.4
656.2
444.8
53.5
126.6r
46.5
-24.0
-6.7
-37.0
-39.1
473.2
45.5
170. l r
106.2
-8.0
-55.1
-4.9
-79.3
495.7
52.0
56.0
185.6
3.1
-17.2
12.4
-1.3
551.4
73.0
125.9
67.9
-12.4
-3.5
8.1
-1.0
346.4
52.3
139.0
82.9
.4
-14.3
26.3
23.3
All sectors
52 Total net borrowing, all sectors
986.4
993.6
971.0
876.0
606.0r
53
54
55
56
57
58
59
60
316.4
83.5
125.2
325.4
32.9
2.7
32.3
68.0
274.9
53.7
126.3
317.5
50.1
39.9
75.4
55.8
297.3
65.0
125.5
303.0
41.7
41.9
65.9
30.6
414.4
51.2
102.9
244.3
17.5
2.8
30.7
12.4
426.0
45.8
151.4r
130.6
-12.5
-27.1
-44.0
-64.2
U.S. government securities
State and local obligations
Corporate and foreign bonds
Mortgages
Consumer credit
Bank loans n.e.c
Open market paper
Other loans
627.4
584. l r
382.0
35.6
129.2
183.9
-10.4
-5.9
-20.2
-66.9
404.1
48.5
179.5r
185.8
-7.8
-40.9
-113.8
-71.2
External corporate equity funds raised in United States
61 Total net share issues
62 Mutual funds
63 All other
64
Nonfinancial corporations
65
Financial corporations
66
Foreign shares purchased in United States
7.1
-118.4
-65.7
22.1
198.8
112.4
182.3r
231.8r
268.9
271.7
281.5
305.3
70.2
-63.2
-75.5
14.5
-2.1
6.1
-124.5
-129.5
4.1
.9
38.5
-104.2
-124.2
2.7
17.2
67.9
-45.8
-63.0
9.8
7.4
150.5
48.3
18.3
-.1
30.2
98.1
14.3
-6.0
-6.7
27.0
125.6
56.7r
12.0
8.r
36.6
182.5
49.3 r
19.0
-3.8r
34.1
195.9
72.9
48.0
2.0
22.9
189.8
81.9
46.0
6.0
29.9
223.3
58.2
36.0
9.7
12.5
249.2
56.2
11.0
9.2
36.0
1. Data in this table also appear in the Board's Z.l (780) quarterly statistical
release, tables F.2 through F.5. For ordering address, see inside front cover.
Flow of Funds
1.58
A41
SUMMARY OF FINANCIAL TRANSACTIONS 1
Billions of dollars except as noted; quarterly data at seasonally adjusted annual rates
1992
1991
Transaction category or sector
1987
1988
1989
1990
1991
Ql
Q2
Q3
Q4
Ql*
Q2*
Q3
N E T LENDING IN CREDIT MARKETS
1 Total net lending in credit markets
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
Private domestic nonfinancial sectors
Households
Nonfarm noncorporate business
Nonfinancial corporate business
State and local governments
U.S. government
Foreign
Financial sectors
Sponsored credit agencies
Mortgage pools
Monetary authority
Commercial banking
U.S. commercial banks
Foreign banking offices
Bank affiliates
Banks in U.S. possession
Private nonbank finance
Thrift institutions
Savings and loan associations
Mutual savings banks
Credit unions
Insurance
Life insurance companies
Other insurance companies
Private pension funds
State and local government retirement funds
Finance n.e.c
Finance companies
Mutual funds
Money market funds
Real estate investment trusts (REITs)
Brokers and dealers
Securitized credit obligation (SCOs) issuers
584.1*
564.6*
647.7*
786.2
809.4
656.2
49.4*
203.8
21.6r
190.5*
172.3 -13.7 r
13.3*
174.1*
-1.4
-1.9*
-1.8*
-2.0
6.6
2oy
-7.6*
29.0
45.4
26.2
16.3
-10.6
33.7
10.0
35.2
24.8
58.4
44.7
19.1
51.4
580.2
529.7
523.8*
317.4
16.4
14.2
27.4
-22.3
141.5
150.3
138.6
157.1
8.1
31.1
58.1
-4.0
125.4
114.4
84.0
34.7
95.2
77.0
38.9
6.4
28.4
42.2
48.5
33.7
-4.7
-2.8
-1.5
-2.6
4.5
-1.9
-.1
-2.8
279.9
261.8
182.3*
152.0
-151.9 -144.9 -188.3 -164.8
-143.9 -140.9 -179.8 -144.0
-16.5 -15.5
-11.7
-31.1
8.5
11.5
3.3
10.2
188.5
215.4
236.2
219.5
94.4
83.2
112.9
132.8
32.7
26.5
34.7
37.0
16.6
60.6
42.1
.7
51.0
48.5
37.0
49.0
134.4*
243.3
191.3
97.4
41.6 -13.1
-18.5
-14.5
41.4
44.0
90.3
75.3
80.9
30.1
134.2
-68.9
-.7
-.7
-1.6*
-.1
-56.9
34.9
49.0
66.8
33.2
45.2
35.6
38.7
-135.3*
-177.9*
-1.6
32.2
12.1
-2.1
37.3
664.7*
33.7
135.8
48.1
82.4
26.5
56.7
2.4
-3.3
364.7*
-176.8
-156.3
-30.8
10.3
254.5
73.8
36.8
110.5
33.4
287.0*
-5.2
117.1
1.1
-.3*
135.8
38.5
-18.2*
-64.4*
-2.1
30.1
18.2
-17.9
71.0
612.9
17.8
120.1
22.3
104.3
45.6
61.3
-1.1
-1.5
348.3
-49.7
-83.3
11.5
22.2
151.4
13.2
32.1
89.2
17.0
246.5
-14.1
124.8
53.9
-.9
50.5
32.3
139.2
160.0
-1.9
-2.9
-16.1
13.9
88.4
544.7
93.0
115.3
33.2
98.9
91.9
.6
6.4
.0
204.4
-113.3
-137.9
7.6
17.0
120.4
80.6
33.1
-22.5
29.2
197.2
.8
105.3
61.8
-.7
7.5
22.5
73.5
47.6
-2.5
21.4
7.1
-25.1
142.5
618.4
39.9
151.2
9.8
58.4
.5
58.6
-.6
-.1
359.2
-81.6
-92.4
-7.4
18.3
192.9
92.5
22.2
51.9
26.3
247.9
-23.0
156.1
-20.9
2.6
89.8
43.2
-252.7
-276.4
-1.9
38.0
-12.3
-27.8
58.4
878.3
73.9
90.6
10.8
101.5
105.2
-2.7
-1.4
.4
601.5
-21.8
-14.5
-17.5
10.2
224.6
98.7
2.5
88.7
34.7
398.7
18.9
172.3
-16.3
2.6
184.0
37.1
584.1*
564.6*
647.7*
786.2
809.4
656.2
-4.8
.4
31.4*
197.9*
-79.8*
-75.4
7.9
-1.1
-63.0
-58.7
43.1
-3.6
125.6
56.7*
20.1
41.1*
-11.5
-34.1
65.0*
-15.5
-5.0
.4
.5
19.4
9.2*
339.6
232.5*
99.5* -36.8*
47.8*
27.3
114.4
104.5
-42.4
13.0
-78.1 -117.4
4.0
26.8
36.3
16.0
3.0
-5.0*
182.5
195.9
72.9
49.3*
82.4
120.7
47.5*
-7.7*
13.0
-3.3
44.9
5.1
243.2*
52.3*
3.5
.1
21.2
145.9
48.8
93.2
89.0
-27.7
-81.3
106.1
15.5
-8.3
189.8
81.9
-70.0
82.6
-4.4
-24.6
124.5
-6.5
.3
30.3
185.5
27.4
-47.4
93.2
-88.5
-106.0
-38.3
136.7
-44.5
223.3
58.2
-4.3
45.5
14.2
12.5
298.9
2.5
.2
19.9
312.2
120.8
191.7
202.2
-73.3
-63.5
-13.0
135.4
4.0
249.2
56.2
73.6
42.1
-4.3
1.1
190.0
916.7* 1,507.3* 1,522.9*
1,478.7
1,647.2
1,911.4
23.9
-2.1
27.1*
-73.1
-6.1
-4.0*
4.4
-13.3
14.7
-11.7
-17.5
-12.1
.4
-23.9
-6.5
-.3
-.2
28.4
20.8
76.2
36.9
23.4
2.0
9.3* -194.2*
-.1
.2
44.0*
18.5
185.0*
-.4
13.4
-41.1
-18.3
-78.0
-.1
-15.1
101.5
29.5
-64.4
-.3
-8.4
67.7
11.9
36.3
749.5* 1,564.2* 1,358.6*
1,597.2
1,637.2
1,834.3
876.0
606.0*
627.4
986.4
993.6
971.0
237.4
180.7
-5.6
18.5
43.9
-7.9
61.8
695.0
27.0
142.3
24.7
135.3
99.1
34.2
2.0
.1
365.8
136.9
93.5
25.6
17.8
153.5
91.7
39.5
-4.7
27.0
75.4
38.2
25.8
1.8
1.0
-30.6
39.1
226.2
198.9
3.1
5.7
18.6
-10.6
96.3
681.8
37.1
74.9
10.5
157.1
127.1
29.4
-.1
.7
402.2
119.0
87.4
15.3
16.3
186.2
103.8
29.2
18.1
35.1
96.9
49.2
11.9
10.7
.9
-8.2
32.5
209.6
179.5
-.8
12.9
17.9
-3.1
74.1
690.4
-.5
125.8
-7.3
176.8
145.7
26.7
2.8
1.6
395.7
-91.0
-93.9
-4.8
7.7
207.7
93.1
29.7
36.2
48.7
278.9
69.3
23.8
67.1
.5
96.3
22.0
986.4
993.6
971.0
876.0
606.0*
627.4
-9.7
.5
26.0
104.5
34.8
141.1
4.1r
76.3r
50.6
24.0
-10.9
-3.1
70.2
-63.2
-27.4
57.7
5.4
-60.9
241.2
4.0
.5
25.3
193.6
2.9
259.9
43.2
120.8
53.6
21.9
23.5
-3.1
6.1
-124.5
3.0
89.2
5.3
-31.2
222.3
24.8
4.1
28.8
221.4
-16.5
290.0
6.1
96.7
17.6
90.1
78.3
1.1
38.5
-104.2
15.6
60.0
2.0
-32.5
269.9
2.0
2.5
25.7
186.8
34.2
96.8
44.2
59.9
-66.7
70.3
-23.5
12.6
67.9
-45.8
3.5
44.1
-.5
-39.3
120.5
-5.9
.0
22.0
263.5r
-5.0*
6i.r
75.8
16.7
-60.9
41.3
-16.4
4.6*
150.5
48.3
51.4
10.3*
-9.1
— 1.4r
145.0*
1.5
-1.2
27.9*
284.1
-3.0*
244.8
76.2
97.3
15.1
193.0
-160.7
24.0
98.1
14.3
-17.5
-39.6*
-34.8
-21.5*
219.6*
1,506.7
1,650.2
1,772.7
.0
.4
-8.5
1.6
.8
-.9
8.4
-3.2
.6
3.3
2.5
21.5
-.1
-4.0
-21.2
6.7
10.0
-.1
-3.0
-29.8
6.3
4.4
-.2
-4.4
23.9
2.3
-95.6
.2
1.6
-34.8
6.5
-13.8
1,523.4
1,670.7
1,841.0
RELATION OF LIABILITIES
TO FINANCIAL ASSETS
35 Net flows through credit markets
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
Other financial sources
Official foreign exchange
Treasury currency and special drawing rights
Life insurance reserves
Pension fund reserves
Interbank claims
Deposits at financial institutions
Checkable deposits and currency
Small time and savings deposits
Large time deposits
Money market fund shares
Security repurchase agreements
Foreign deposits
Mutual fund shares
Corporate equities
Security credit
Trade debt
Taxes payable
Noncorporate proprietors' equity
Miscellaneous
55 Total financial sources
Floats not included in assets (-)
56 U.S. government checking deposits
57 Other checkable deposits
58 Trade credit
59
60
61
62
63
Liabilities not identified as assets ( - )
Treasury currency
Interbank claims
Security repurchase agreements
Taxes payable
Miscellaneous
64 Totals identified to sectors as assets
I. Data in this table also appear in the Board's Z.l (780) quarterly statistical
release, tables F.6 and F.7. For ordering address, see inside front cover.
1,374.3 1,336.8* 1,400.3*
-13.1
2.0
18.3*
-18.8
13.3
9.8*
-.6
-1.9
26.2
55.3
10.4* -115.4
7.4
-14.4
-29.9* -119.9*
1,387.5 1,316.1* 1,592.2*
15.6
3.0
40.5*
2. Excludes corporate equities and mutual fund shares.
A42
1.59
DomesticNonfinancialStatistics • February 1993
SUMMARY OF CREDIT MARKET DEBT OUTSTANDING 1
Billions of dollars, end of period
1991
Transaction category or sector
1988
1989
1990
1992
1991
Ql
Q3
Q2
Q4
Ql
Q2
Q3
Nonfinancial sectors
1 Total credit market debt owed by
domestic nonfinancial sectors
9,316.3
10,087.1
10,760.8
11,210.8
10,832.3
10,960.3
11,082.5
11,210.8
11,336.7
11,464.8
11,583.6
By lending sector and instrument
2 U.S. government
Treasury securities
3
4
Agency issues and mortgages
2,104.9
2,082.3
22.6
2,251.2
2,227.0
24.2
2,498.1
2,465.8
32.4
2,776.4
2,757.8
18.6
2,548.8
2,522.4
26.4
2,591.9
2,567.1
24.8
2,687.2
2,669.6
17.6
2,776.4
2,757.8
18.6
2,859.7
2,844.0
15.8
2.923.3
2.907.4
15.9
2,998.9
2,980.7
18.1
5 Private
7,211.4
7,835.9
8,262.6
8,434.5
8,283.5
8,368.3
8,395.3
8,434.5
8,477.0
8,541.5
8,584.8
6
7
8
9
10
11
12
13
14
15
16
17
18
By instrument
Debt capital instruments
Tax-exempt obligations
Corporate bonds
Mortgages
Home mortgages
Multifamily residential
Commercial
Farm
Other debt instruments
Consumer credit
Bank loans n.e.c
Open market paper
Other
5,119.0
939.4
852.2
3,327.3
2,257.5
286.7
696.4
86.8
2,092.5
742.1
710.6
85.7
554.1
5,577.9
1.004.4
926.1
3.647.5
2,515.1
304.4
742.6
85.3
2,258.0
791.8
760.7
107.1
598.4
5,936.0
1.055.6
973.2
3,907.3
2,760.0
305.8
757.6
84.0
2.326.7
809.3
758.0
116.9
642.6
6,190.6
1,101.4
1.052.0
4,037.3
2.902.1
303.8
748.2
83.2
2,243.9
796.7
724.6
98.5
624.1
5.997.7
1,061.5
992.3
3.943.8
2.788.9
307.3
763.7
83.9
2,285.8
785.3
748.3
120.8
631.5
6,087.5
1,072.5
1.016.5
3.998.6
2,836.9
310.4
767.4
83.8
2,280.8
786.7
742.0
119.4
632.6
6.138.4
1,089.3
1,036.9
4,012.2
2.869.5
303.1
756.5
83.1
2,256.9
785.9
734.1
107.0
629.8
6,190.6
1,101.4
1.052.0
4,037.3
2.902.1
303.8
748.2
83.2
2,243.9
796.7
724.6
98.5
624.1
6,256.9
1,111.5
1,071.0
4.074.4
2.945.5
303.5
742.6
82.9
2,220.0
775.7
712.5
110.3
621.6
6,319.4
1,128.6
1.090.4
4.100.5
2.985.0
295.6
736.4
83.6
2.222.1
775.8
709.4
111.7
625.1
6,373.9
1.145.6
1.105.7
4,122.6
3,023.2
292.9
722.7
83.8
2,210.9
781.1
699.6
108.3
621.9
19
20
21
22
23
24
By borrowing sector
State and local government
Household
Nonfinancial business
Farm
Nonfarm noncorporate
Corporate
752.5
3,177.3
3,281.6
137.6
1,127.1
2,016.9
815.7
3.508.2
3,512.0
139.2
1,177.5
2.195.3
864.0
3,780.6
3,618.0
140.5
1,204.2
2,273.4
902.5
3,938.6
3,593.3
138.8
1,180.6
2,273.9
870.1
3,788.3
3.625.2
136.8
1,207.1
2.281.3
878.5
3,848.3
3,641.5
139.6
1,210.8
2,291.1
891.4
3,888.7
3,615.3
140.4
1,191.0
2,283.9
902.5
3,938.6
3,593.3
138.8
1,180.6
2,273.9
911.3
3.960.8
3.604.9
136.3
1,174.9
2,293.7
925.9
4,009.9
3,605.8
140.2
1,160.0
2,305.6
942.3
4,051.6
3,590.9
141.7
1,144.0
2,305.2
244.6
254.8
278.6
292.7
291.3
277.6
282.2
292.7
282.4
298.5
307.0
83.1
21.5
49.9
90.1
88.0
21.4
63.0
82.4
109.4
18.5
75.3
75.4
124.2
21.6
81.8
65.2
112.1
20.5
87.0
71.6
114.8
19.7
74.0
69.1
118.6
20.0
78.0
65.6
124.2
21.6
81.8
65.2
125.4
22.0
70.5
64.4
131.1
25.5
77.5
64.4
137.0
26.4
80.7
63.1
9,560.9
10,341.9
11,039.4
11,503.6
11,123.6
11,237.9
11,364.7
11,503.6
11,619.1
11,763.3
11,890.7
25 Foreign credit market debt held in
United States
26
27
28
29
Bonds
Bank loans n.e.c
Open market paper
U.S. government loans
30 Total credit market debt owed by nonfinancial
sectors, domestic and foreign
Financial sectors
31 Total credit market debt owed by
financial sectors
2,082.9
2,333.0
2,524.2
2,667.8
2,546.3
2,571.4
2,608.2
2,667.8
2,686.9
2,739.9
2,802.6
By instrument
U.S. government-related
Sponsored credit-agency securities
Mortgage pool securities
Loans from U.S. government
Private
Corporate bonds
Mortgages
Bank loans n.e.c
Open market paper
Loans from Federal Home Loan Banks..,
1,098.4
348.1
745.3
5.0
984.6
415.1
3.4
35.6
377.7
152.8
1,249.3
373.3
871.0
5.0
1,083.7
491.9
3.4
37.5
409.1
141.8
1,418.4
393.7
1,019.9
4.9
1,105.8
528.2
4.2
38.6
417.7
117.1
1,566.2
402.9
1,158.5
4.8
1,101.6
590.2
4.8
41.8
385.7
79.1
1,452.1
397.0
1,050.3
4.9
1,094.1
545.4
4.2
36.5
400.9
107.0
1,482.8
389.6
1,088.4
4.9
1,088.6
562.2
4.5
37.0
390.1
94.7
1,524.4
394.7
1,124.8
4.9
1,083.9
569.5
4.4
39.0
387.0
83.9
1,566.2
402.9
1,158.5
4.8
1,101.6
590.2
4.8
41.8
385.7
79.1
1,592.9
405.7
1,182.4
4.8
1,094.0
578.2
5.0
41.6
392.9
76.3
1,641.6
417.8
1,219.0
4.8
1,098.3
583.2
5.0
43.7
389.5
76.9
1,682.2
433.4
1,244.0
4.8
1,120.4
597.0
5.1
44.5
393.7
80.2
By borrowing sector
42 Sponsored credit agencies
43 Mortgage pools
44 Private financial sectors
45 Commercial banks
46 Bank affiliates
47 Savings and loan associations
48 Mutual savings banks
49 Finance companies
50 Real estate investment trusts (REITs)
51 Securitized credit obligation (SCO) issuers
353.1
745.3
984.6
78.8
136.2
159.3
18.6
444.6
11.4
135.7
378.3
871.0
1,083.7
77.4
142.5
145.2
17.2
504.2
10.1
187.1
398.5
1,019.9
1.105.8
76.3
114.8
115.3
16.7
539.8
10.6
232.3
407.7
1,158.5
1,101.6
63.0
112.3
75.9
13.2
557.9
11.4
268.0
401.8
1,050.3
1,094.1
68.1
114.4
104.2
16.4
539.6
10.8
240.6
394.4
1,088.4
1,088.6
65.9
113.3
91.0
16.6
540.4
11.0
250.3
399.5
1,124.8
1,083.9
64.6
110.6
79.0
15.2
543.7
11.0
259.9
407.7
1,158.5
1,101.6
63.0
112.3
75.9
13.2
557.9
11.4
268.0
410.5
1,182.4
1,094.0
60.8
115.0
71.2
13.5
547.1
12.7
273.6
422.6
1,219.0
1,098.3
61.7
112.7
70.3
14.3
541.8
13.2
284.4
438.2
1,244.0
1,120.4
63.3
112.3
71.0
16.2
550.8
13.2
293.7
32
33
34
35
36
37
38
39
40
41
All sectors
52 Total credit market debt, domestic and foreign..
53
54
55
56
57
58
59
60
U.S. government securities
State and local obligations
Corporate and foreign bonds
Mortgages
Consumer credit
Bank loans n.e.c
Open market paper
Other loans
11,643.9
12,674.9
13,563.6
14,171.3
13,669.9
13,809.2
13,973.0
14,171.3
14,306.0
14,503.3
14,693.3
3,198.3
939.4
1,350.4
3,330.7
742.1
767.7
513.4
801.9
3,495.6
1,004.4
1,506.0
3,650.9
791.8
819.6
579.2
827.5
3,911.7
1,055.6
1,610.7
3,911.5
809.3
815.1
609.9
839.9
4,337.7
1,101.4
1,766.4
4,042.1
796.7
788.0
565.9
773.2
3,996.1
1,061.5
1,649.9
3,948.1
785.3
805.3
608.8
814.9
4,069.8
1,072.5
1,693.5
4,003.1
786.7
798.7
583.6
801.4
4,206.7
1,089.3
1,725.0
4,016.7
785.9
793.2
572.0
784.2
4,337.7
1,101.4
1,766.4
4,042.1
796.7
788.0
565.9
773.2
4,447.8
1,111.5
1,774.6
4,079.4
775.7
776.1
573.7
767.1
4,560.1
1,128.6
1,804.7
4,105.5
775.8
778.7
578.7
771.2
4,676.2
1,145.6
1,839.7
4,127.6
781.1
770.4
582.6
770.0
1. Data in this table also appear in the Board's Z.l (780) quarterly statistical
release, tables L.2 through L.4. For ordering address, see inside front cover.
Flow of Funds
1.60
A43
S U M M A R Y OF F I N A N C I A L A S S E T S A N D LIABILITIES 1
Billions of dollars except as noted, end of period
1991
Transaction category or sector
1988
1989
1990
1992
1991
Q1
Q2
Q3
Qlr
Q2"
Q3
14,171.3" 14,306.0
14,503.3
14,693.3
2,4%. 1
1,716.6
51.9
1%.2
531.4
250.2
859.3
10,700.4
419.9
1,182.4
271.8
2,860.6
2,514.0
313.3
13.6
19.7
5,965.8
1,161.8
771.1
213.4
177.2
2,750.5
1,224.3
387.0
657.6
481.6
2,053.6
641.0
480.3
423.1
6.8
228.8
273.6
2,487.1
1,690.9
51.3
210.7
534.2
245.2
894.9
10,876.1
429.0
1,219.0
282.6
2,882.9
2,521.9
328.2
13.1
19.7
6,062.6
1,143.0
748.8
211.6
182.6
2,801.0
1,249.8
392.5
670.5
488.2
2,118.6
641.6
520.4
413.5
7.5
251.2
284.4
2,456.8
1,665.7
50.8
211.0
529.4
237.8
909.5
11,089.1
445.6
1,244.0
285.2
2,908.9
2,550.0
326.6
12.5
19.8
6,205.3
1,137.5
743.2
207.2
187.1
2,856.2
1,273.5
393.1
692.7
4%.9
2,211.6
642.5
561.2
408.8
8.1
297.3
293.7
14,171.3" 14,306.0
14,503.3
14,693.3
Q4
CREDIT MARKET DEBT OUTSTANDING 2
1 Total credit market assets
2 Private domestic nonfinancial sectors
3 Households
4
Nonfarm noncorporate business
5
Nonfinancial corporate business
6
State and local governments
7 U.S. government
8 Foreign
9 Financial sectors
10 Sponsored credit agencies
11
Mortgage pools
12 Monetary authority
13 Commercial banking
14
U.S. commercial banks
Foreign banking offices
15
16
Bank affiliates
Banks in U.S. possession
17
Private nonbank finance
18
Thrift institutions
19
20
Savings and loan associations
21
Mutual savings banks
22
Credit unions
Insurance
23
24
Life insurance companies
25
Other insurance companies
26
Private pension funds
27
State and local government retirement funds.
Finance n.e.c
28
29
Finance companies
30
Mutual funds
31
Money market funds
32
Real estate investment trusts (REITs)
Brokers and dealers
33
34
Securitized credit obligation (SCOs) issuers .
13,563.6 14,171.3r 13,669.9
11,643.9
12,674.9
2,185.5
1,485.1
57.2
167.4
475.8
213.2
653.2
8,592.0
367.7
745.3
240.6
2,476.3
2,231.9
215.6
13.4
15.4
4,762.1
1,572.0
1,184.2
240.6
147.2
1,932.6
920.0
287.9
358.5
366.2
1,257.5
559.2
283.4
224.7
7.8
46.7
135.7
2,440.5
1,710.1
56.4
180.3
493.7
205.1
734.2
9,295.1
367.2
871.0
233.3
2,643.9
2,368.4
242.3
16.2
17.1
5,179.7
1,484.9
1,088.9
241.1
154.9
2,140.3
1,013.1
317.5
394.7
414.9
1,554.5
617.1
307.2
291.8
8.4
142.9
187.1
11,643.9
12,674.9
27.1
53.6
61.3
19.8
325.5
2,755.0
46.9
4,354.7
882.8
2,169.2
596.9
338.0
325.0
42.8
478.3
118.3
838.4
79.8
2,312.0
23.8
354.3
3,210.5
32.4
4,644.6
888.6
2,265.4
615.4
428.1
403.2
43.9
566.2
133.9
903.9
81.8
2,508.3
26.3
380.0
3,303.0
64.0
4,741.4
932.8
2,325.3
548.7
498.4
379.7
56.6
602.1
137.4
938.0
81.4
2,678.8
2,644.2 2,490.8r
1,882.3 1,693.6"
55.0
53. r
186.9
207.9"
519.9
536.2
238.7
246.2
792.4
837.2"
9,888.3 10,597.2"
383.6
397.7
1,019.9 1,158.5
241.4
272.5
2,769.3 2,853.3
2,463.6 2,502.5
270.8
319.2
13.4
11.9
21.6
19.7
5,474.1 5,915.1"
1,335.5 1,190.6
945.1
804.2
227.1
211.5
163.4
174.9
2,329.1 2,723.8"
1,116.5 1,199.6
344.0
378.7
431.3
671.1"
437.4
474.3
1,809.4 2,000.7
658.7
645.6
360.2
450.5
372.7
402.8
7.7
7.0
177.9
226.9
232.3
268.0
13,809.2" 13,973.0
2,634.3" 2,653.8
2,648.2
2,490.8"
1,875.4" 1,882.1/ 1,875.5" 1,693.6"
53.1"
53.8"
53.3"
52.9
189.7"
174.5"
189.9"
207.9"
530.6
528.8
530.0
536.2
245.5
252.9
252.0
246.2
797.1
810.0
819.3
837.2"
9,992.9" 10,092.6" 10,253.3 10,597.2"
388.5
382.7
389.5
397.7
1,050.3
1,088.4
1,124.8
1,158.5
247.3
253.7
264.7
272.5
2,780.2
2,796.6 2,817.8
2,853.3
2,480.0
2,488.7
2,470.8
2,502.5
284.4
275.6
297.5
319.2
12.3
11.3
11.6
11.9
21.6
20.9
20.0
19.7
5,526./ 5,571.2" 5,656.5
5,915.1"
1,287.8
1,248.4
1,205.1
1,190.6
901.3
866.3
826.1
804.2
224.1
216.4
208.7
211.5
165.7
170.2
174.9
162.3
2,448.8
2,511.7
2,392.0
2,723.8"
1,148.5
1,183.7
1,201.4
1,199.6
361.4
352.2
370.7
378.7
441.8
442.0
469.6
671.1"
461.7
449.5
470.1
474.3
1,846.9" 1,874.0" 1,939.7
2,000.7
651.7
647.4
649.4
645.6
374.6
394.4
421.4
450.5
411.4
389.9
389.5
402.8
7.3"
7.3"
7.2
7.0
163.6
180.4
214.3
226.9
240.6
250.3
259.9
268.0
RELATION OF LIABILITIES
TO FINANCIAL ASSETS
35 Total credit market debt
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
Other liabilities
Official foreign exchange
Treasury currency and special drawing rights
certificates
Life insurance reserves
Pension fund reserves
Interbank claims
Deposits at financial institutions
Checkable deposits and currency
Small time and savings deposits
Large time deposits
Money market fund shares
Security repurchase agreements
Foreign deposits
Mutual fund shares
Security credit
Trade debt
Taxes payable
Miscellaneous
13,563.6 14,171.3" 13,669.9
55.4
13,809.2" 13,973.0
52.7
54.4
55.4
26.3
407.3
4,251.2
64.2
4,801.4
984.7
2,341.3
468.8
571.0
376.4
59.1
859.3
195.1
942.6
73.5
2,816.2
26.4
414.9
4,304.4
69.2
4,797.5
1,032.8
2,315.3
437.5
557.2
406.8
47.9
936.7
194.1
949.4
70.1
2,870.5
26.5
419.8
4,439.7
100.6
4,841.7
1,071.9
2,2%.4
425.5
553.2
445.7
48.9
1,013.4
212.4
976.2
72.2
2,929.0
26,577.2 28,585.4" 26,954.9" 27,125.9" 27,638.6" 28,585.4" 28,795.8
29,190.9
29,780.2
26.3
402.0
4,235.9"
63.9"
4,802.5"
1,008.5
2,342.0
487.9
539.6
363.4
61.2"
812.4
188.9
940.8"
72.2
2,813.7"
56.6
26.0
385.0
3,520.6
59.2"
4,776.4
905.1
2,355.3
553.1
551.7
348.6
62.6
661.6
132.5
903.5"
75.1
2,688.6"
53.6
26.1
392.3
3,555.8
35.8"
4,765.7
933.1
2,351.5
532.6
532.8
354.0
61.7
683.7
137.5
909.4"
65.8
2,691.0"
52.9
26.2
397.2
3,720.8
60.7"
4,769.5
948.3
2,339.7
517.1
533.1
368.9
62.4
744.2
158.1
935.3"
71.8
2,729.0"
55.4
26.3
402.0
4,235.9"
63.9"
4,802.5"
1,008.5
2,342.0
487.9
539.6
363.4
61.2"
812.4
188.9
940.8"
72.2
2,813.7"
22,999.5
25,188.3
Financial assets not included in liabilities (+)
54 Gold and special drawing rights
55 Corporate equities
56 Household equity in noncorporate business
40.0
3,141.6
2,373.1
40.3
3,819.7
2,524.9
41.3
3,506.6
2,449.4
41.6
4,630.0
2,372.5"
40.7
4,047.2
2,478.4
40.7
4,104.7
2,509.4"
41.1
4,338.5
2,495.9"
41.6
4,630.0
2,372.5"
41.3
4,739.7
2,381.4
41.5
4,678.8
2,362.6
23.2
4,832.4
2,335.6
Floats not included in assets ( - )
57 U.S. government checking deposits
58 Other checkable deposits
59 Trade credit
5.9
29.6
-164.3
6.1
26.5
-159.7
15.0
28.9
-148.0
3.8"
30.9
-134.1"
5.2
26.7
-157.9"
8.3
29.9
-157.7"
19.8
23.6
-154.2"
3.8"
30.9
-134.1"
.9
22.0
-133.3
1.4
20.1
-148.6
4.1
8.3
-154.3
-4.1
-28.5
-12.4
21.4
-134.6
-4.3
-31.0
11.5
20.6
-253.3
-4.1
-32.0
-23.3
21.8
-249.7
-4.8
-4.2
-12.9"
18.8
-451.6"
-4.6
-15.5
-39.6
21.4
-262.4"
-4.7
-9.9
-25.8
11.7
-244.5"
-4.7
-4.7
-10.6
17.5
-303.2"
-4.8
-4.2
-12.9"
18.8
-451.6"
-4.9
-1.8
-10.1
16.6
-441.1
-4.9
-4.0
11.0
12.4
-441.2
-5.0
-7.4
32.9
9.4
-467.8
28,841.1
31,956.8
32,966.0 36,183.5" 33,947.9" 34,173.4" 34,930.5" 36,183.5" 36,510.0
36,827.5
37,551.1
53 Total liabilities
60
61
62
63
64
Liabilities not identified as assets ( - )
Treasury currency
Interbank claims
Security repurchase agreements
Taxes payable
Miscellaneous
65 Totals identified to sectors as assets
1. Data in this table also appear in the Board's Z.l (780) quarterly statistical
release, tables L.6 through L.7. For ordering address, see inside front cover.
2. Excludes corporate equities and mutual fund shares,
A44
2.10
Domestic Nonfinancial Statistics • February 1993
NONFINANCIAL BUSINESS ACTIVITY
Selected Measures
Monthly data seasonally adjusted, 1987= 100 except as noted
1992
Measure
1989
1990
1991
Mar.
Apr.
May
June
July
Aug."
Sept."
Oct."
Nov.
1 Industrial production1
108.1
109.2
107.1
107.6
108.1
108.9
108.5
109.4
109.1
108.8
109.3
109.7
Market groupings
Products, total
Final, total
Consumer goods
Equipment
Intermediate
Materials
108.6
109.1
106.7
112.3
106.8
107.4
110.1
110.9
107.3
115.5
107.7
107.8
108.1
109.6
107.5
112.2
103.4
105.5
108.5
109.8
109.3
110.4
104.4
106.1
109.0
110.6
110.1
111.3
103.9
106.8
109.7
111.4
110.8
112.3
104.4
107.7
109.0
110.5
109.6
111.6
104.4
107.6
109.6
111.0
110.4
111.8
105.1
109.0
109.8
111.5
110.8
112.5
104.4
108.1
109.3
111.0
110.3
111.9
104.0
108.0
110.1
111.9
111.0
112.9
104.5
108.1
110.4
112.2
111.3
113.4
104.8
108.6
108.9
109.9
107.4
108.5
109.0
109.9
109.6
110.2
110.1
109.7
110.3
110.8
2
3
4
5
6
7
Industry groupings
8 Manufacturing
9 Capacity utilization, manufacturing
(percent) 2
83.9
82.3
78.2
77.5
77.7
78.2
77.8
78.1
77.9
77.4
77.7
77.9
10 Construction contracts 3
105.2
95.3
89.6 r
96.0
93.0
86.0
90.0
89.0
90.0
89.0
104.0
n.a.
11 Nonagricultural employment, total 4
12
Goods-producing, total
13
Manufacturing, total
14
Manufacturing, production worker
15
Service-producing
16 Personal income, total
17
Wages and salary disbursements
18
Manufacturing
19
Disposable personal income
20 Retail sales 6
106.0
102.5
102.2
102.3
107.1
115.2
114.4
110.6
115.1
113.5
107.5
101.0
100.5
100.1
109.5
122.7
121.3
113.5
122.9
118.7
106.0
96.4
97.0
96.1
109.0"
127.0
124.4
113.6
128.0
119.8
105.9
95.2
96.1
95.7
109.3
131.8
128.0
114.6
133.8
123.1
106.0
95.2
96.1
95.7
109.5
131.9
127.8
115.0
133.8
123.5
106.2
95.3
96.1
95.7
109.6
132.4
128.6
115.5
134.2
124.1
106.1
95.0
95.9
95.4
109.6
132.5
128.5
115.1
134.4
124.0
106.3
94.9
95.9
95.5
109.9
132.7"
128.6"
115.3
134.4"
125.4
106.2
94.6
95.4
94.9
109.9
132.9
129.4
115.0
134.5
125.5
106.2
94.3
95.2
94.6
110.0
133.6
129.2
115.0
135.2
126.5
106.2
94.1
94.8
94.3
110.0
134.9
130.1
116.0
136.6
128.8
106.3
94.2
95.0
94.6
110.2
Prices7
21 Consumer (1982-84= 100)
22 Producer finished goods (1982=100)
124.0
113.6
130.7
119.2
136.2
121.7
139.3
122.2
139.5
122.4
139.7
123.2
140.2
123.9
140.5
123.7
140.9
123.5
141.3
123.3
141.8
124.3
142.0
123.9
1. A major revision of the industrial production index and the capacity
utilization rates was released in April 1990. See "Industrial Production: 1989
Developments and Historical Revision," Federal Reserve Bulletin, vol. 76 (April
1990), pp. 187-204.
2. Ratio of index of production to index of capacity. Based on data from the
Federal Reserve, DRI McGraw-Hill, U.S. Department of Commerce, and other
sources.
3. Index of dollar value of total construction contracts, including residential,
nonresidential, and heavy engineering, from McGraw-Hill Information Systems
Co., F.W. Dodge Division.
4. Based on data from U.S. Department of Labor, Employment and Earnings.
Series covers employees only, excluding personnel in the armed forces.
5. Based on data from U.S. Department of Commerce, Survey of Current
Business.
n.a.
n.a.
129.3
6. Based on data from U.S. Bureau of the Census, Survey of Current Business.
7. Based on data not seasonally adjusted. Seasonally adjusted data for changes
in the price indexes can be obtained from the Bureau of Labor Statistics, U.S.
Department of Labor, Monthly Labor Review.
NOTE. Basic data (not indexes) for series mentioned in notes 4, 5,and 6, and
indexes for series mentioned in notes 3 and 7 can also be found in the Survey of
Current Business.
Figures for industrial production for the latest month are preliminary, and many
figures for the three months preceding the latest month have been revised. See
"Recent Developments in Industrial Capacity and Utilization," Federal Reserve
Bulletin,
vol. 76 ( J u n e 1990), p p . 411-35.
Selected Measures
2.11
A45
LABOR FORCE, EMPLOYMENT, A N D UNEMPLOYMENT
Thousands of persons; monthly data seasonally adjusted except as noted
1992
Category
1989
1990
1991
Apr.
May
June
July
Aug.
Sept. r
Oct/
Nov.
HOUSEHOLD SURVEY DATA
1 Noninstitutional population1
188,601
190,216
191,883
193,168
193,295
193,431
193,588
193,749
193,893
194,051
194,210
2 Labor force (including Armed Forces) 1
3 Civilian labor force
Employment
4
Nonagncultural industries
5
Agriculture
Unemployment
6
Number
7
Rate (percent of civilian labor force)
8 Not in labor force
126,077
123,869
126,954
124,787
127,421
125,303
128,830
126,830
129,148
127,160
129,525
127,549
129,498
127,532
129,3%
127,437
129,219
127,273
128,879
126,959
129,132
127,238
114,142
3,199
114,728
3,186
114,644
3,233
114,465
3,209
114,478
3,178
114,322
3,252
114,568
3,204
114,519
3,218
114,459
3,242
114,465
3,160
114,834
3,211
6,528
5.3
62,524
6,874
5.5
63,262
8,426
6.7
64,462
9,155
7.2
64,338
9,504
7.5
64,147
9,975
7.8
63,906
9,760
7.7
64,090
9,700
7.6
64,353
9,572
7.5
64,674
9,334
7.4
65,172
9,193
7.2
65,078
108,329
109,872
108,310
108,377
108,496
108,423
108,594
108,485
108,497
108,531
108,636
19,442
693
5,187
5,644
25,770
6,695
27,120
17,779
19,117
710
5,133
5,808
25,877
6,729
28,130
18,304
18,455
691
4,685
5,772
25,328
6,678
28,323
18,380
18,279
646
4,605
5,746
25,170
6,682
28,707
18,542
18,275
641
4,632
5,745
25,143
6,681
28,833
18,546
18,236
634
4,600
5,745
25,144
6,672
28,854
18,538
18,242
633
4,584
5,742
25,156
6,660
28,971
18,606
18,145
626
4,591
5,729
25,070
6,661
28,981
18,682
18,102
620
4,574
5,738
25,079
6,669
29,065
18,650
18,037
622
4,598
5,730
25,104
6,680
29,142
18,618
18,072
622
4,587
5,735
25,060
6,676
29,206
18,678
ESTABLISHMENT SURVEY DATA
9 Nonagncultural payroll employment3
10
11
12
13
14
15
16
17
Manufacturing
Mining
Contract construction
Transportation and public utilities
Trade
Finance
Service
Government
1. Persons sixteen years of age and older. Monthly figures are based on sample
data collected during the calendar week that contains the twelfth day; annual data
are averages of monthly figures. By definition, seasonality does not exist in
population figures.
2. Includes self-employed, unpaid family, and domestic service workers.
3. Includes all full- and part-time employees who worked during, or received
pay for, the pay period that includes the twelfth day of the month; excludes
proprietors, self-employed persons, household and unpaid family workers, and
members of the armed forces. Data are adjusted to the March 1984 benchmark,
and only seasonally adjusted data are available at this time.
SOURCE. Based on data from U.S. Department of Labor, Employment and
Earnings.
A46
2.12
Domestic Nonfinancial Statistics • February 1993
OUTPUT, CAPACITY, A N D CAPACITY UTILIZATION 1
Seasonally adjusted
1991
Q4
1992
Ql
Q2
1991
Q3r
Output (1987=100)
Q4
1992
Ql
Q2
1991
Q4
Q3
Capacity (percent of 1987 output)
1992
Ql
Q2
Q3 r
Capacity utilization rate (percent)
1 Total industry
107.9
107.1
108.5
109.1
136.2
137.0
137.7
138.4
79.3
78.2
78.8
78.8
2 Manufacturing
108.6
108.0
109.5
110.0
138.9
139.7
140.6
141.4
78.2
77.3
77.9
77.8
3
4
Primary processing
Advanced processing
104.1
110.7
104.0
109.9
105.4
111.4
106.4
111.7
128.8
143.5
129.3
144.6
129.6
145.6
129.9
146.7
80.8
77.1
80.5
76.0
81.3
76.5
81.9
76.2
5
6
Durable goods
Lumber and products
Primary metals
Iron and steel
Nonferrous
Nonelectrical machinery
Electrical machinery
Motor vehicles and parts
Aerospace and miscellaneous
transportation equipment
107.7
95.1
102.5
103.2
101.4
122.7
110.4
97.0
106.6
98.5
102.2
103.8
100.0
122.1
110.5
91.7
108.4
96.7
101.7
101.6
101.7
125.7
111.8
100.5
108.8
98.3
104.0
104.6
103.1
128.8
112.5
98.1
142.8
125.7
129.3
134.5
121.9
162.8
146.6
135.6
143.7
125.9
129.1
134.1
122.1
164.3
147.9
136.2
144.4
126.1
128.3
132.7
122.2
165.9
149.1
136.7
145.2
126.3
127.5
131.2
122.3
167.4
150.4
137.2
75.4
75.7
79.2
76.7
83.2
75.4
75.3
71.5
74.2
78.2
79.2
77.4
81.9
74.3
74.7
67.3
75.0
76.7
79.2
76.6
83.3
75.8
75.0
73.5
74.9
77.9
81.5
79.7
84.3
76.9
74.8
71.5
102.8
99.3
96.8
94.9
139.6
140.4
140.9
141.5
73.7
70.8
68.7
67.1
Nondurable goods
Textile mill products
Paper and products
Chemicals and products
Plastics materials
Petroleum products
109.7
104.1
107.4
113.0
126.2
107.1
109.8
104.3
105.8
113.6
124.4
107.7
110.9
106.2
106.7
116.8
129.7
109.2
111.5
106.4
108.2
117.9
132.4
106.9
133.8
118.3
118.7
142.3
146.1
121.4
134.8
118.8
119.3
143.4
148.7
121.4
135.6
119.2
119.9
144.3
150.5
121.5
136.5
119.7
120.5
145.1
152.2
121.6
82.0
88.0
90.5
79.4
86.4
88.2
81.5
87.9
88.7
79.2
83.7
88.7
81.7
89.0
89.0
81.0
86.2
89.9
81.7
88.9
89.8
81.2
87.0
87.9
99.7
109.4
111.6
97.9
107.0
109.7
98.9
107.4
110.3
99.4
109.0
112.7
114.7
129.2
125.2
114.7
129.5
125.6
114.7
129.8
126.0
114.8
130.1
126.4
87.0
84.7
89.1
85.3
82.6
87.3
86.2
82.7
87.6
86.6
83.8
89.2
Latest cycle 3
1991
July
Aug. r
Sept. r
Oct/
NOV.P
7
8
9
10
11
12
13
14
15
16
17
18
19
20 Mining
21 Utilities
22
Electric
Previous cycle 2
High
Low
High
Low
Nov.
1992
Apr.
May
June
Capacity utilization rate (percent)
1 Total industry
89.2
72.6
87.3
71.8
79.3
78.7
79.1
78.6
79.1
78.8
78.5
78.7
78.9
2 Manufacturing
88.9
70.8
87.3
70.0
78.2
77.7
78.2
77.8
78.1
77.9
77.4
77.7
77.9
3
4
Primary processing
Advanced processing
92.2
87.5
68.9
72.0
89.7
86.3
66.8
71.4
80.8
77.1
81.1
76.3
81.5
76.8
81.4
76.3
82.7
76.2
81.7
76.3
81.3
75.9
81.6
76.2
82.4
76.2
5
6
Durable goods
Lumber and products
Primary metals
Iron and steel
Nonferrous
Nonelectrical machinery
Electrical machinery
Motor vehicles and parts . . . .
Aerospace and miscellaneous
transportation equipment.
88.8
90.1
100.6
105.8
92.9
96.4
87.8
93.4
68.5
62.2
66.2
66.6
61.3
74.5
63.8
51.1
86.9
87.6
102.4
110.4
90.5
92.1
89.4
93.0
65.0
60.9
46.8
38.3
62.2
64.9
71.1
44.5
75.5
76.7
80.0
78.5
82.5
75.4
75.5
70.7
74.6
77.1
78.5
75.8
82.6
75.1
74.7
72.2
75.5
77.2
79.5
77.0
83.3
76.4
75.3
75.1
75.0
75.6
79.7
77.0
83.9
76.0
75.0
73.3
75.2
79.1
82.6
80.8
85.4
76.6
75.1
71.3
75.2
78.3
81.8
79.5
85.2
77.3
75.1
72.5
74.4
76.2
80.2
78.8
82.3
76.9
74.2
70.7
75.0
77.7
82.4
82.2
82.8
77.4
74.4
73.7
75.2
80.0
82.7
82.9
82.3
78.0
74.5
74.1
77.0
66.6
81.1
66.9
73.9
69.2
68.7
68.2
67.7
67.0
66.4
66.1
65.0
Nondurable goods
Textile mill products
Paper and products
Chemicals and products
Plastics materials
Petroleum products
87.9
92.0
96.9
87.9
102.0
96.7
71.8
60.4
69.0
69.9
50.6
81.1
87.0
91.7
94.2
85.1
90.9
89.5
76.9
73.8
82.0
70.1
63.4
68.2
81.9
88.2
89.4
79.4
87.2
87.9
81.8
89.3
89.3
80.4
85.4
90.8
81.8
89.6
88.3
81.1
87.3
89.3
81.6
88.2
89.3
81.3
85.9
89.6
82.0
89.6
91.1
81.5
89.8
89.8
81.6
88.7
88.2
81.1
86 0
85.8
81.6
88.4
90.0
81.2
85 1
88.3
81.4
86.7
87.9
81.3
81.7
87.9
89.0
81.9
91.3
91.5
94.4
95.6
99.0
88.4
82.5
82.7
96.6
88.3
88.3
80.6
76.2
78.7
86.8
85.9
90.0
86.3
83.4
88.2
86.9
82.7
87.5
85.4
82.1
87.0
87.6
84.1
89.5
86.1
83.6
89.2
86.1
83.8
88.7
86.2
83.3
88.3
86.7
82.8
87.6
7
8
Y
10
11
12
13
14
15
16
17
IK
19
20
21 Utilities
22
Electric
1. Data in this table also appear in the Board's G.17 (419) monthly statistical
release. For ordering address, see inside front cover. For a detailed description of
the series, see "Recent Developments in Industrial Capacity and Utilization,"
Federal Reserve Bulletin, vol. 76 (June 1990), pp. 411-35.
2. Monthly high, 1973; monthly low, 1975.
3. Monthly highs, 1978 through 1980; monthly lows, 1982.
Selected Measures
2.13
A47
Indexes and Gross Value 1
INDUSTRIAL PRODUCTION
Monthly data seasonally adjusted
1987
Group
portion
1991
1992
1991
avg.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
May
June
July
Aug/
Sept/
Oct/
Nov."
Index (1987 = 100)
MAJOR MARKETS
100.0
107.1
108.1
107.4
106.6
107.2
107.6
108.1
108.9
108.5
109.4
109.1
108.8
109.3
109.7
2 Products
3
Final products
4
Consumer goods, total
5
Durable consumer goods
6
Automotive products
7
Autos and trucks
Autos, consumer
8
9
Trucks, consumer
10
Auto parts and allied g o o d s . . .
11
Other
Appliances, A/C, and TV
12
13
Carpeting and furniture
14
Miscellaneous home goods . . .
15
Nondurable consumer goods
16
Foods and tobacco
17
Clothing
18
Chemical products
19
Paper products
20
Energy
21
Fuels
Residential utilities
22
60.8
46.0
26.0
5.6
2.5
1.5
.9
.6
1.0
3.1
.8
.9
1.4
20.4
9.1
2.6
3.5
2.5
2.7
.7
2.0
108.1
109.6
107.5
102.3
97.8
90.2
84.6
99.6
109.3
105.8
99.5
99.4
113.4
109.0
106.7
93.5
115.8
123.6
108.5
103.5
110.4
109.0
110.6
110.0
106.0
103.6
99.0
89.8
114.5
110.5
108.0
102.3
101.6
115.2
111.1
108.1
96.5
117.9
126.4
112.0
103.6
115.1
108.4
109.9
109.1
104.6
101.3
96.7
88.2
111.0
108.2
107.2
98.9
101.5
115.5
110.3
107.0
96.2
118.0
126.8
109.3
104.3
111.2
107.5
108.7
108.1
101.3
94.2
84.3
79.1
93.0
109.1
106.9
99.6
101.1
114.7
110.0
107.3
95.0
118.1
126.8
106.8
103.8
108.0
108.1
109.4
108.8
105.3
101.6
94.3
84.8
110.2
112.6
108.3
102.9
102.4
115.0
109.8
107.4
95.2
118.3
124.7
106.4
103.5
107.5
108.5
109.8
109.3
106.2
103.6
95.7
81.9
118.8
115.5
108.3
103.5
102.5
114.7
110.2
107.8
95.1
119.4
124.6
107.0
103.7
108.2
109.0
110.6
110.1
107.9
106.5
102.5
93.1
118.3
112.5
109.1
103.4
104.4
115.2
110.7
107.6
95.3
120.8
125.1
108.9
105.1
110.3
109.7
111.4
110.8
111.1
110.6
107.8
98.6
123.3
114.8
111.5
107.4
105.9
117.3
110.7
107.7
96.4
121.4
124.3
107.2
104.0
108.4
109.0
110.5
109.6
109.2
108.0
104.0
97.6
114.8
114.0
110.2
106.2
103.2
116.9
109.7
107.2
95.5
121.6
121.7
104.8
104.4
105.0
109.6
111.0
110.4
108.6
106.6
100.5
92.3
114.3
115.7
110.3
102.3
103.8
118.8
110.8
108.6
96.8
121.5
121.9
107.4
105.3
108.2
109.8
111.5
110.8
109.2
106.8
100.6
87.2
123.1
116.2
111.1
110.6
103.6
116.1
111.2
110.1
95.0
122.0
121.8
106.2
99.0
108.9
109.3
111.0
110.3
106.9
104.5
98.2
88.1
115.1
114.1
108.7
108.3
99.9
114.6
111.3
108.7
95.4
123.8
124.3
106.3
103.5
107.3
110.1
111.9
111.0
108.6
108.9
105.9
88.5
135.1
113.4
108.3
103.8
100.9
115.5
111.7
109.4
94.2
124.8
124.1
107.2
108.4
106.8
110.4
112.2
111.3
108.9
109.2
107.2
89.4
137.1
112.1
108.7
103.5
102.2
115.8
112.0
109.6
94.9
126.2
123.5
106.8
107.9
106.4
23
24
25
26
27
28
29
30
31
32
33
Equipment
Business equipment
Information processing and related ..
Office and computing
Industrial
Transit
Autos and trucks
Other
Defense and space equipment
Oil and gas well drilling
Manufactured homes
20.0
13.9
5.6
1.9
4.0
2.5
1.2
1.9
5.4
.6
.2
112.2
121.5
131.5
155.5
108.0
126.8
88.6
113.6
91.1
93.3
85.5
111.4
121.8
133.4
157.8
104.2
130.5
96.5
113.8
88.8
78.1
87.0
110.9
121.4
134.0
159.1
102.3
129.5
96.1
114.1
88.1
75.8
87.9
109.4
119.9
134.1
160.6
100.7
124.2
84.9
113.1
86.7
71.8
98.4
110.2
121.0
134.6
162.4
101.3
129.2
94.7
112.2
86.2
73.9
99.7
110.4
121.5
136.0
164.9
101.3
128.9
95.0
112.2
85.6
76.2
98.7
111.3
123.0
137.9
168.2
101.7
131.7
101.3
113.2
84.7
79.2
100.7
112.3
124.5
139.2
170.5
103.4
133.3
105.6
115.0
84.2
79.2
100.3
111.6
124.1
140.4
174.0
102.9
131.8
101.7
111.5
83.6
74.6
97.1
111.8
124.4
141.9
178.0
103.4
128.7
98.1
112.2
82.7
78.6
112.0
112.5
125.9
143.5
182.0
102.7
132.6
101.3
114.4
81.8
75.0
106.1
111.9
125.3
143.4
184.0
101.9
130.3
99.1
115.6
81.0
74.4
111.2
112.9
126.7
145.8
187.0
102.2
132.2
105.6
115.5
80.5
80.2
119.9
113.4
127.4
147.1
190.0
102.9
131.5
107.7
116.4
79.7
85.2
123.5
34
35
36
Intermediate products, total
Construction supplies
Business supplies
14.7
6.0
8.7
103.4
96.0
108.4
103.9
95.9
109.4
103.8
95.0
110.0
103.9
95.5
109.9
104.0
96.0
109.6
104.4
96.7
109.7
103.9
96.5
109.0
104.4
97.8
109.0
104.4
97.2
109.4
105.1
98.6
109.7
104.4
98.5
108.5
104.0
96.8
109.0
104.5
97.8
109.1
104.8
98.4
109.2
37 Materials
38
Durable goods materials
Durable consumer parts
39
40
Equipment parts
41
Other
42
Basic metal materials
43
Nondurable goods materials
44
Textile materials
45
Pulp and paper materials
46
Chemical materials
47
Other
48
Energy materials
49
Primary energy
50
Converted fuel materials
39.2
19.4
4.2
7.3
7.9
2.8
9.0
1.2
1.9
3.8
2.1
106.6
108.6
100.5
113.7
108.3
108.1
107.7
99.9
108.6
108.3
110.1
105.8
108.1
97.0
114.2
108.4
108.1
107.1
98.5
109.6
107.0
109.7
105.2
107.0
95.3
114.1
106.7
105.1
107.3
98.9
107.4
107.6
111.2
105.8
108.1
97.1
115.2
107.5
107.3
107.1
101.5
106.8
106.6
111.2
106.1
108.3
97.9
115.1
107.5
106.3
108.9
102.0
107.8
109.3
112.7
106.8
108.7
99.3
114.7
108.1
106.3
109.4
103.2
109.2
109.9
112.2
102.2
100.9
104.5
100.4
100.4
100.5
100.1
101.3
100.4
100.5
100.5
100.2
100.6
100.4
98.2
103.8
99.8
104.1
107.7
110.4
102.5
116.2
109.2
108.3
109.7
102.9
107.8
111.2
112.4
101.3
99.7
104.3
107.6
110.2
102.9
116.2
108.7
107.7
110.4
102.3
110.8
110.9
113.4
7.2
3.7
105.5
107.1
96.4
114.4
106.0
106.0
105.9
97.0
106.9
106.1
109.7
102.3
102.4
102.0
99.6
102.6
109.0
111.2
101.8
117.5
110.2
111.5
111.7
103.9
111.8
113.4
112.8
102.9
102.3
104.1
108.1
111.1
103.9
117.0
109.5
110.9
110.3
102.9
108.9
111.9
112.6
100.9
101.4
100.0
108.0
110.1
102.2
116.3
108.5
108.8
110.5
103.9
112.7
110.9
111.5
102.2
100.5
105.4
108.1
110.9
102.7
117.1
109.6
110.0
110.1
102.5
109.6
111.9
111.6
101.3
99.6
104.7
108.6
111.3
103.1
117.3
110.1
110.1
111.8
105.4
112.0
112.5
114.0
101.1
99.8
103.7
97.3
95.3
107.6
107.9
108.3
108.7
107.7
108.0
107.3
107.6
107.6
107.8
107.9
108.2
108.3
108.6
109.0
109.2
108.6
108.8
109.6
109.9
109.3
109.6
109.1
109.4
109.4
109.7
109.8
110.1
1 Total index
10.9
100.6
SPECIAL AGGREGATES
51 Total excluding autos and trucks
52 Total excluding motor vehicles and parts . . .
53 Total excluding office and computing
machines
54 Consumer goods excluding autos and
trucks
55 Consumer goods excluding energy
56 Business equipment excluding autos and
trucks
57 Business equipment excluding office and
computing equipment
58 Materials excluding energy
97.5
105.8
106.8
106.1
105.3
105.8
106.1
106.6
107.4
106.8
107.6
107.3
106.9
107.3
107.7
24.5
23.3
108.6
107.4
110.7
109.6
108.3
109.7
109.1
110.2
109.6
110.6
110.3
110.9
111.2
109.9
110.1
111.0
110.7
111.4
111.3
111.1
109.8
109.8
109.1
111.3
111.5
111.6
111.9
12.7
124.8
124.3
123.8
123.3
123.6
124.1
125.2
126.4
126.3
127.0
128.3
127.9
128.8
129.3
12.0
28.4
116.0
106.7
116.0
108.3
115.3
107.8
113.3
107.1
114.3
107.8
114.5
108.5
115.7
108.9
117.1
110.2
116.1
110.3
115.8
111.3
116.8
110.8
115.9
110.2
116.9
110.7
117.3
111.4
110.8
A48
Domestic Nonfinancial Statistics • February 1993
2.13—Continued
„ roup
SIC
code
1987
proportion
1991
1992
1991
avg.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
May
June
July
Aug. r
Sept. r
Oct. r
Nov. p
Index (1987 = 100)
MAJOR INDUSTRIES
1 Total index
100.0
107.1
108.1
107.4
106.6
107.2
107.6
108.1
108.9
108.S
109.4
109.1
108.8
109.3
109.7
84.4
26.7
57.7
107.4
102.4
109.8
108.6
104.1
110.7
108.1
103.5
110.3
107.4
103.6
109.2
108.1
103.9
110.0
108.5
104.5
110.3
109.0
105.0
110.8
109.9
105.6
111.9
109.6
105.6
111.4
110.2
107.3
111.6
110.1
106.2
112.0
109.7
105.7
111.5
110.3
106.2
112.2
110.8
107.3
112.5
Durable goods
Lumber and products . . .
"24
Furniture and fixtures . . .
25
Clay, glass, and stone
products
32
Primary metals
33
Iron and steel
331,2
Raw steel
Nonferrous
333-6,9
Fabricated metal
products
34
Nonelectrical machinery.
35
Office and computing
machines
357
Electrical machinery
36
Transportation
equipment
37
Motor vehicles and
parts
371
Autos and light
trucks
Aerospace and miscellaneous transportation equipment.. 372 - 6 , 9
Instruments
38
Miscellaneous
39
47.3
2.0
1.4
107.1
94.2
99.1
107.8
96.4
99.9
107.1
95.2
100.6
105.8
97.4
98.7
107.0
98.8
98.1
107.0
99.2
98.6
107.6
97.2
101.1
109.1
97.4
103.3
108.5
95.4
100.3
109.0
99.8
101.0
109.2
98.9
101.7
108.2
96.3
100.8
109.2
98.2
101.4
109.7
101.2
102.3
2.5
3.3
1.9
.1
1.4
94.9
99.5
98.0
97.3
101.5
92.8
103.5
105.6
99.1
100.5
93.0
101.3
101.7
97.6
100.8
92.8
102.5
105.0
103.3
98.9
94.6
102.7
103.7
102.7
101.2
95.0
101.4
102.5
98.8
99.9
95.6
100.9
100.9
99.9
100.9
96.7
102.0
102.2
98.5
101.8
96.6
102.1
101.8
101.5
102.5
97.1
105.6
106.4
105.3
104.4
96.4
104.3
104.4
101.9
104.2
96.0
102.0
103.0
99.8
100.6
96.8
104.7
107.1
101.7
101.3
96.9
104.8
107.6
103.4
100.8
5.4
8.6
100.4
123.5
101.8
122.8
101.2
121.9
99.7
121.4
100.5
121.9
100.0
122.9
100.6
124.1
102.2
126.7
102.2
126.4
102.6
127.8
102.5
129.3
101.4
129.1
102.0
130.4
102.9
131.7
2.5
8.6
155.5
110.1
157.8
110.7
159.1
110.6
160.5
110.0
162.4
110.7
164.9
110.9
168.2
111.0
170.5
112.3
174.0
112.2
178.0
112.6
182.0
113.0
184.0
111.9
187.0
112.5
190.0
113.0
Nondurable goods
Foods
Tobacco products
Textile null products
Apparel products
Paper and products .,
Printing and publishing . .
Chemicals and products .
Petroleum products
Rubber and plastic
products
Leather and products . . .
2 Manufacturing
3 Primary processing
4 Advanced processing ,
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34 Mining
35 Metal
36 Coal
37 Oil and gas extraction
38 Stone and earth minerals ..
39 Utilities
40 Electric
41 Gas
9.8
98.6
99.7
98.0
93.8
96.8
96.5
98.0
99.6
98.2
96.7
97.0
95.6
97.4
96.9
4.7
90.4
95.9
94.6
87.1
93.8
94.2
98.5
102.7
100.4
97.7
99.4
97.2
101.4
102.1
2.3
89.4
97.6
95.5
83.5
92.9
93.7
101.1
106.5
103.0
99.3
98.6
96.7
103.3
104.6
5.1
3.3
1.2
106.0
118.2
119.3
103.1
118.7
120.7
101.2
119.0
121.0
99.8
118.3
121.2
99.6
118.6
120.0
98.6
118.6
120.0
97.4
119.0
118.9
96.8
119.8
118.4
96.3
118.5
117.8
95.7
118.5
120.4
94.9
118.2
118.2
94.1
117.9
118.6
93.8
117.8
119.1
92.3
117.3
121.2
20
21
22
23
26
27
28
29
37.2
8.8
1.0
1.8
2.4
3.6
6.4
8.6
1.3
107.9
108.6
99.7
100.5
96.2
105.1
112.3
110.9
107.5
109.6
110.1
97.7
104.4
98.8
106.1
114.2
113.0
106.7
109.5
109.6
94.7
102.5
99.0
107.0
114.5
112.6
108.6
109.5
109.2
98.8
103.1
97.5
107.1
114.8
112.7
106.6
109.6
109.6
99.4
104.7
97.7
104.6
114.4
113.4
106.9
110.4
110.2
101.3
105.3
97.8
105.8
113.8
114.8
109.7
110.7
109.6
101.0
106.3
98.0
107.0
113.7
115.8
110.3
110.9
109.3
102.5
106.8
99.0
105.8
113.4
117.0
108.5
111.0
109.0
103.6
105.3
98.1
107.3
113.0
117.5
108.9
111.7
109.8
106.6
107.1
99.4
109.6
112.3
118.0
109.1
111.3
110.6
115.9
106.1
97.6
106.3
111.4
117.6
104.3
111.6
110.0
108.7
105.9
97.6
108.6
113.1
118.1
107.4
111.6
110.9
107.4
104.1
97.5
106.2
112.6
118.4
111.1
112.2
111.2
106.8
105.7
97.9
107.8
111.6
119.6
111.4
30
31
3.0
.3
110.0
88.1
112.6
84.3
113.0
83.2
113.2
83.0
114.0
81.4
115.4
82.9
116.5
84.1
117.1
86.2
117.3
86.2
118.5
87.1
119.0
84.8
117.6
85.8
118.6
86.1
119.7
88.3
"10
11,12
13
14
7.9
.3
1.2
5.7
.7
101.1
150.2
109.2
95.8
108.1
99.6
151.5
108.4
94.1
105.8
98.8
154.0
107.6
93.0
106.4
97.8
144.2
107.3
92.4
104.8
98.4
152.9
107.9
92.7
103.5
97.5
155.8
103.0
91.9
107.4
99.1
154.2
104.0
94.2
105.9
99.7
166.4
107.6
93.4
108.0
98.0
154.0
98.6
93.9
105.6
100.6
163.7
112.0
94.0
106.2
98.8
165.6
107.5
92.4
106.4
98.8
164.6
103.7
93.3
105.5
98.9
165.2
102.8
93.7
105.1
99.5
165.8
105.0
94.0
105.4
49i,3PT
492,3PT
7.6
6.0
1.6
109.2
112.8
96.0
111.0
112.7
104.7
107.9
109.9
100.5
106.8
109.3
97.5
106.4
109.0
96.9
107.7
110.7
96.7
108.2
111.0
97.7
107.3
110.2
96.6
106.7
109.7
95.3
109.3
113.0
95.4
108.8
112.7
94.1
109.1
112.3
97.4
108.6
111.8
96.6
107.9
111.0
96.5
79.8
108.4
109.3
108.9
108.6
108.9
109.3
109.6
110.3
110.1
110.9
110.7
110.4
110.8
111.3
82.0
106.0
107.1
106.6
105.8
106.5
106.8
107.2
108.1
107.6
108.2
108.0
107.4
108.0
108.4
SPECIAL AGGREGATES
42 Manufacturing excluding
motor vehicles and
parts
43 Manufacturing excluding
office and computing
machines
Gross value (billions of 1982 dollars, annual rates)
MAJOR MARKETS
44 Products, total
1,734.8 1,880.0 1,904.9 1,888.9 1,869.5 1,889.7 1,902.8 1,918.7 1,935.5 1,920.1 1,936.2 1,935.9 1,934.0 1,959.8 1,971.1
45 Final
46 Consumer goods
47 Equipment
48 Intermediate
1,350.9 1,481.8 1,504.1 1,488.0 1,468.7 1,490.8 1,501.5 1,518.2 1,532.1 1,519.1 1,530.4 1,532.8 1,532.7 1,556.8 1,565.8
833.4
879.8
902.2
894.5
877.6
890.2
896.2
905.6
912.4
901.3
909.3
905.3
905.4
921.4
925.2
517.5 602.0
593.5
591.1
601.8
600.6
605.3
612.7
619.7
617.8
621.0
627.5
627.3
635.4
640.5
384.0
398.2
401.0
400.8
400.7
398.9
401.2
400.5
403.4
401.1
405.8
403.1
401.3
403.0
405.4
1. Data in this table also appear in the Board's G.17 (419) monthly statistical
release. For ordering address, see inside front cover.
A major revision of the industrial production index and the capacity
utilization rates was released in April 1990. See "Industrial Production: 1989
Developments and Historical Revision," Federal Reserve Bulletin, vol. 76 (April
1990), pp. 187-204.
2. Standard industrial classification,
Selected Measures
2.14
A49
HOUSING A N D CONSTRUCTION
Monthly figures at seasonally adjusted annual rates except as noted
1992
1989
Item
1990
1991
Jan.
Feb.
Mar.
Apr.
May
June
July
Sept.
Oct.
1,076
877
199
1,233
1,042
191
633
480
153
l,144 r
955r
189"
198
1,125
913
212
l,222 r
l,051 r
I71 r
638r
486r
152
1,121
936
185
219
1,139
959
180
1,224
1,086
138
642
493
149
1,161
980
181
226
Aug.
Private residential real estate activity (thousands of units except as noted)
N E W UNITS
1,339
932
407
1,376
1,003
373
850
535
315
1,423
1,026
396
198
1,111
794
317
1,193
895
298
711
449
262
1,308
966
342
188
949
754
195
1,014
840
174
606
434
173
1,091
838
253
171
1,106
913
193
1,180
989
191
640
466
174
1,043
838
205
192
1,146
946
200
1,257
1,109
148
629
464
165
1,097
908
189
197
1,094
907
187
1,340
1,068
272
657
482
175
1,127
975
152
197
1,058
873
185
1,086
933
153
655
484
171
1,067
889
178
199
1,054
879
175
1,196
1,019
177
653
484
169
1,204
1,011
193
189
1,032
872
160
1,147
999
148
643
483
160
1,184
982
202
194
1,080
879
201
1,100
956
144
628
476
152
1,229
1,019
210
211
650
365
535
321
507
283
667
281
627
269
555
277
546
274
554
272
583
272
616
271
625
270
669
268
600
267
120.4
148.3
122.3
149.0
120.0
147.0
120.0
144.2
117.2
144.8
120.0
144.8
120.0
145.0
113.0
146.0
124.5
146.6
118.0
137.7
123.0
144.6
119.0
142.3
125.0
152.6
18 Number sold
3,346
3,211
3,219
3,220
3,490
3,510
3,490
3,460
3,350
3,450
3,310
3,300
3,640
Price of units sold (thousands
of dollarsr
19 Median
20 Average
92.9
118.0
95.2
118.3
99.7
127.4
102.4
130.5
102.8
128.8
104.0
130.2
103.3
130.6
102.5
130.6
105.1
133.7
102.7
132.2
104.6
132.2
103.4
131.0
103.4
129.4
1
2
3
4
5
6
7
8
9
10
11
12
13
Permits authorized
One-family
Two-or-more-family
Started
One-family
Two-or-more-family
Under construction at end of period 1 ..
One-family
Two-or-more-family
Completed
One-family
Two-or-more-family
Mobile homes shipped
Merchant builder activity in
one-family units
14 Number sold
15 Number for sale at end of period
...
Price of units Sj)ld (thousands
16 Median
17 Average
EXISTING UNITS ( o n e - f a m i l y )
Value of new construction (millions of dollars) 3
CONSTRUCTION
21 Total put in place
443,401
442,066
400,955
407,121
411,767
421,512
427,585
427,980
426,730
427,670
417,554
424,983
429,295
22 Private
23
Residential
24
Nonresidential, total
25
Industrial buildings
26
Commercial buildings
Other buildings
27
28
Public utilities and other
345,327
196,551
148,776
20,412
65,496
19,683
43,185
334,153
182,856
151,297
23,849
62,866
21,591
42,991
290,707
157,837
132,870
22,281
48,482
20,797
41,310
292,540
169,548
122,992
21,258
41,196
19,751
40,787
294,758
169,772
124,986
21,651
41,591
20,630
41,114
301,142
172,660
128,482
23,721
42,108
21,479
41,174
309,832
182,644
127,188
21,335
40,712
21,409
43,732
306,999
182,892
124,107
21,008
39,643
21,993
41,463
312,182
184,630
127,552
20,285
43,310
21,991
41,966
307,880
182,871
125,009
20,513
39,847
22,290
42,359
300,295
181,340
118,955
17,845
37,057
21,521
42,532
306,091
183,192
122,899
18,947
39,271
22,038
42,643
309,856
187,352
122,504
18,258
39,338
22,197
42,711
98,071
3,520
28,837
5,009
60,705
107,909
2,664
31,154
4,607
69,484
110,247
1,837
29,918
4,958
73,534
114,581
2,039
30,221
5,480
76,841
117,009
2,206
32,744
5,283
76,776
120,370
2,548
30,895
6,197
80,730
117,753
2,329
31,447
5,818
78,159
120,981
2,668
32,633
5,767
79,913
114,548
2,503
31,496
5,889
74,660
119,790
2,275
32,605
5,829
79,081
117,259
2,153
33,292
5,302
76,512
118,892
2,477
34,313
6,350
75,752
119,439
2,071
31,931
7,611
77,826
29 Public
30
Military
Highway
31
Conservation and development...
32
33
Other
1. Not at annual rates.
2. Not seasonally adjusted.
3. Recent data on value of new construction may not be strictly comparable
with data for previous periods because of changes by the Census Bureau in its
estimating techniques. For a description of these changes, see Construction
Reports (C-30-76-5), issued by the Census Bureau in July 1976.
SOURCE. Census Bureau estimates for all series except (1) mobile homes, which
are private, domestic shipments as reported by the Manufactured Housing
Institute and seasonally adjusted by the Census Bureau, and (2) sales and prices
of existing units, which are published by the National Association of Realtors. All
back and current figures are available from the originating agency. Permit
authorizations are those reported to the Census Bureau from 17,000 jurisdictions
beginning in 1984.
A50
2.15
Domestic Nonfinancial Statistics • February 1993
CONSUMER A N D PRODUCER PRICES
Percentage changes based on seasonally adjusted data except as noted
Change from 12
months earlier
Item
Change from 3 months earlier
(annual rate)
1991
1991
Nov.
Change from 1 month earlier
Index
level,
Nov.
19921
19921
1992
1992
Nov.
Dec.
Mar.
June
Sept.
July
Aug.
Sept.
Oct.
Nov.
CONSUMER PRICES 2
(1982-84= 100)
1 All items
2 Food
i Energy items
4 All items less food and energy
5
Commodities
6
Services
3.0
3.0
3.2
3.5
2.6
2.6
.1
.3
.2
.4
.2
142.0
1.6
-8.2
4.5
4.4
4.5
1.5
2.7
3.4
2.5
3.9
2.7
3.6
3.1
.6
4.3
1.5
-6.9
4.8
5.3
4.8
-1.2
12.5
2.8
2.1
2.9
4.7
.4
2.5
2.1
2.6
-.1
.3
.2
.2
.3
.9
-.2
.2
.2
.3
.4
.0
.2
.2
.1
.0
.5
.3
.6
.0
.8
.3
.1
.3
138.3
104.5
149.3
134.2
158.0
-.5
-1.6
-12.7
3.4
2.6
1.3
.2
.5
2.1
1.6
1.0
-1.0
-.5
2.4
1.9
1.0
.3
-7.0
3.6
3.5
3.3
-1.0
17.9
2.4
.9
1.6
3.6
-.5
1.2
.9
.0
-.2
— ,6r
.2
.1
.7
-,3r
-.1
,2r
.3
.4
.8
.2
.0
.1
.1
1.4
-.1
-.2
-.2
-.5
-1.5
.2
.1
123.9
123.3
78.5
138.2
130.0
-3.5
-1.0
1.1
1.0
-1.7
.0
.0
1.7
5.4
1.7
.3
1.0
.2r
-.R
.R
.1
.0
.0
-.2
-.2
.0
115.4
122.2
-6.5
-22.0
-8.3
1.3
2.6
2.8
-4.9
5.3
-5.9
11.8
-26.6
15.0
1.9
51.5
4.8
-6.2
16.4
2.5
-1.8
i.r
.9"
.6
3.6
-.5
.6
-.5
-1.3
-.6
.6
-.9
102.8
83.3
126.8
.5
PRODUCER PRICES
(1982=100)
7 Finished goods
8
Consumer foods
9
Consumer energy
10 Other consumer goods
11 Capital equipment
Intermediate materials
12 Excluding foods and feeds
14
Excluding energy
Crude materials
14 Foods
15 Energy
16 Other
1. Not seasonally adjusted.
2. Figures for consumer prices are for all urban consumers and reflect a
rental-equivalence measure of homeownership.
.R
.R
-.4
,2r
SOURCE. Bureau of Labor Statistics.
Selected Measures
2.16
A51
GROSS DOMESTIC PRODUCT A N D INCOME
Billions of current dollars except as noted; quarterly data at seasonally adjusted annual rates
1992
1991
Account
1989
1990
1991
Q3
Q4
Ql
Q2
Q3r
GROSS DOMESTIC PRODUCT
5,250.8
5,522.2
5,677.5
5,713.1
5,753.3
5,840.2
5,902.2
5,982.5
3,523.1
459.4
1,149.5
1,914.2
3,748.4
464.3
1,224.5
2,059.7
3,887.7
446.1
1,251.5
2,190.1
3,914.2
453.0
1,255.3
2,205.9
3,942.9
450.4
1,251.4
2,241.1
4,022.8
469.4
1,274.1
2,279.3
4,057.1
470.6
1,277.5
2,309.0
4,108.1
482.7
1,293.0
2,332.4
832.3
798.9
568.1
193.3
374.8
230.9
799.5
793.2
577.6
201.1
376.5
215.6
721.1
731.3
541.1
180.1
360.9
190.3
732.8
732.6
538.4
175.6
362.8
194.2
736.1
726.9
528.7
169.7
358.9
198.2
722.4
738.2
531.0
170.1
360.8
207.2
773.2
765.1
550.3
170.3
380.0
214.8
786.4
765.3
547.9
164.8
383.0
217.5
33.3
31.8
6.3
3.3
-10.2
-10.3
.2
-1.2
9.2
14.5
-15.8
-13.3
8.1
6.4
21.1
15.8
14 Net exports of goods and services
15 Exports
16 Imports
-79.7
508.0
587.7
-68.9
557.0
625.9
-21.8
598.2
620.0
-27.1
602.3
629.5
-16.0
622.9
638.9
-8.1
628.1
636.2
-37.1
625.4
662.5
-34.9
639.5
674.4
17 Government purchases of goods and services
18 Federal
19 State and local
975.2
401.6
573.6
1,043.2
426.4
616.8
1,090.5
447.3
643.2
1,093.3
447.2
646.0
1,090.3
440.8
649.5
1,103.1
445.0
658.0
1,109.1
444.8
664.3
1,122.9
454.1
668.8
5,217.5
2,063.6
891.2
1,172.5
2,642.2
511.7
5,515.9
2,160.1
920.6
1,239.5
2,846.4
509.4
5,687.7
2,192.8
907.6
1,285.1
3,030.3
464.7
5,712.9
2,194.9
910.8
1,284.1
3,053.6
464.4
5,744.2
2,188.4
905.7
1,282.7
3,090.3
465.5
5,855.9
2,233.6
923.6
1,310.0
3,142.2
480.1
5,894.1
2,233.2
932.3
1,300.8
3,173.4
487.6
5,961.4
2,260.1
944.9
1,315.1
3,214.8
486.5
33.3
25.2
8.1
6.3
-.9
7.2
-10.2
-19.3
9.0
.2
-7.0
7.2
9.2
-8.1
17.3
-15.8
-19.3
3.5
8.1
9.5
-1.4
21.1
7.8
13.3
4,838.0
4,877.5
4,821.0
4,831.8
4,838.5
4,873.7
4,892.4
4,939.4
30 Total
4,249.5
4,468.3
4,544.2
4,555.4
4,599.1
4,679.4
4,716.5
4,714.3
31 Compensation of employees
32 Wages and salaries
33
Government and government enterprises
34
Other
35
Supplement to wages and salaries
36
Employer contributions for social insurance
37
Other labor income
3,100.2
2,586.4
478.5
2,107.9
513.8
261.9
251.9
3,291.2
2,742.9
514.8
2,228.0
548.4
277.4
271.0
3,390.8
2,812.2
543.5
2,268.7
578.7
290.4
288.3
3,407.0
2,824.4
544.3
2,280.0
582.6
292.0
290.6
3,433.8
2,845.0
546.4
2,298.6
588.7
293.7
295.0
3,476.3
2,877.6
554.6
2,323.0
598.7
299.4
299.2
3,506.3
2,901.3
561.4
2,339.9
605.0
301.5
303.6
3,529.8
2,919.3
564.0
2,355.3
610.5
302.6
307.9
38 Proprietors' income1
Business and professional1
39
40
Farm1
347.3
307.0
40.2
366.9
325.2
41.7
368.0
332.2
35.8
367.1
337.6
29.5
377.9
340.0
37.9
393.6
353.6
40.1
398.4
359.9
38.5
397.6
366.1
31.5
1 Total
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
Producers' durable equipment
11
Residential structures
12
13
Change in business inventories
Nonfarm
Bx major type of product
20 Final sales, total
Goods
21
Durable
22
23
Nondurable
24 Services
25
Structures
26 Change in business inventories
27
Durable goods
28
Nondurable goods
MEMO
29 Total GDP in 1987 dollars
NATIONAL INCOME
41 Rental income of persons 2
-13.5
-12.3
-10.4
-10.3
-6.6
-4.5
3.3
5.0
42 Corporate profits'
Profits before tax
43
44
Inventory valuation adjustment
45
Capital consumption adjustment
362.8
342.9
-17.5
37.4
361.7
355.4
-14.2
20.5
346.3
334.7
3.1
8.4
341.2
336.7
-4.8
9.3
347.1
332.3
.7
14.1
384.0
366.1
-5.4
23.3
388.4
376.8
-15.5
27.0
370.4
350.5
-9.8
29.7
46 Net interest
452.7
460.7
449.5
450.5
446.9
430.0
420.0
411.5
1. With inventory valuation and capital consumption adjustments.
2. With capital consumption adjustment.
3. For after-tax profits, dividends, and the like, see table 1.48.
SOURCE. U.S. Department of Commerce, Survey of Current Business.
A52
2.17
Domestic Nonfinancial Statistics • February 1993
PERSONAL INCOME A N D SAVING
Billions of current dollars except as noted; quarterly data at seasonally adjusted annual rates
1992
1991
Account
1989
1990
Q3
Q4
Ql
Q2
Q3r
PERSONAL INCOME AND SAVING
I Total personal income
4,380.3
4,664.2
4,828.3
4,846.2
4,907.2
4,980.5
5,028.9
5,060.2
2 Wage and salary disbursements
3
Commodity-producing industries
Manufacturing
4
5
Distributive industries
Service industries
6
Government and government enterprises
7
2,586.4
724.2
542.2
607.0
776.8
478.5
2,742.8
745.6
556.1
634.6
847.8
514.8
2,812.2
737.4
556.9
647.4
883.9
543.6
2,824.4
738.8
559.0
651.1
890.2
544.3
2,845.0
741.5
563.9
652.9
904.3
546.4
2,877.6
736.8
559.9
660.9
925.3
554.6
2,901.3
743.1
564.7
662.9
933.9
561.4
2,919.3
741.3
564.2
666.9
947.2
564.0
14 Personal interest income
15 Transfer payments
16 Old-age survivors, disability, and health insurance benefits . . .
251.9
347.3
307.0
40.2
-13.5
126.5
668.2
625.0
325.1
271.0
366.9
325.2
41.7
-12.3
140.3
694.5
685.8
352.0
288.3
368.0
332.2
35.8
-10.4
137.0
700.6
771.1
382.0
290.6
367.1
337.6
29.5
-10.3
135.6
701.8
777.1
384.2
295.0
377.9
340.0
37.9
-6.6
134.3
703.3
799.8
390.6
299.2
393.6
353.6
40.1
-4.5
133.9
684.8
842.7
405.7
303.6
398.4
359.9
38.5
3.3
136.6
675.2
859.7
412.1
307.9
397.6
366.1
31.5
5.0
141.0
666.7
873.9
417.1
17
211.4
224.8
238.4
240.1
241.5
246.8
249.3
251.2
4,380.3
4,664.2
4,828.3
4,846.2
4,907.2
4,980.5
5,028.9
5,060.2
8 Other labor income
9 Proprietors' income 1
10
Business and professional
11
Farm 1
12 Rental income of persons*
LESS: Personal contributions for social insurance
18 EQUALS: Personal income
593.3
621.3
618.7
618.6
622.3
619.6
617.1
629.4
20 EQUALS: Disposable personal income
3,787.0
4,042.9
4,209.6
4,227.6
4,284.9
4,360.9
4,411.8
4,430.9
21
LESS: Personal outlays
3,634.9
3,867.3
4,009.9
4,036.6
4,065.5
4,146.3
4,179.5
4,229.9
22 EQUALS: Personal saving
152.1
175.6
199.6
191.0
219.4
214.6
232.3
201.0
19,555.6
13,028.9
14,005.0
19,513.0
13,043.6
14,068.0
19,077.1
12,824.1
13,886.0
19,094.0
12,847.9
13,876.0
19,066.0
12,802.6
13,913.0
19,158.5
12,930.2
14,017.0
19,181.8
12,893.3
14,021.0
19,310.7
12,973.4
13,993.0
4.0
4.3
4.7
4.5
5.1
4.9
5.3
4.5
19
LESS: Personal tax and nontax payments
MEMO
Per c apita (1987 dollars)
23 Gross domestic product
24 Personal consumption expenditures
25 Disposable personal income
26 Saving rate (percent)
GROSS SAVING
741.8
718.0
708.2
679.4
698.2
677.5
682.9
693.7
28 Gross private saving
819.4
854.1
901.5
884.9
934.8
950.1
968.1
986.5
29 Personal saving
30 Undistributed corporate profits
31 Corporate inventory valuation adjustment
152.1
86.9
-17.5
175.6
75.7
-14.2
199.6
75.8
3.1
191.0
69.0
-4.8
219.4
78.3
.7
214.6
104.0
-5.4
232.3
97.7
-15.5
201.0
87.7
-9.8
352.4
228.0
368.3
234.6
383.0
243.1
383.5
241.4
386.3
250.7
386.1
245.3
391.2
247.0
407.2
290.6
-77.5
-122.3
44.8
-136.1
-166.2
30.1
-193.3
-210.4
17.1
-205.6
-221.0
15.4
-236.6
-258.7
22.0
-272.6
-289.2
16.6
-285.2
-302.9
17.7
-292.8
-301.9
9.1
Capital consumption
allowances
34 Government surplus, or deficit ( - ) , national income and
36
State and local
37 Gross investment
38 Gross private domestic
40 Statistical discrepancy
1. With inventory valuation and capital consumption adjustments.
2. With capital consumption adjustment.
742.9
723.4
730.1
709.9
714.6
706.5
713.8
735.4
832.3
-89.3
799.5
-76.1
721.1
9.0
732.8
-22.9
736.1
-21.5
722.4
-16.0
773.2
-59.4
786.4
-51.1
1.1
5.4
21.9
30.5
16.4
29.0
30.9
41.7
SOURCE. U.S. Department of Commerce, Survey of Current
Business.
Summary Statistics
3.10
U.S. INTERNATIONAL TRANSACTIONS
A53
Summary
Millions of dollars; quarterly data seasonally adjusted except as noted 1
1991
1 Balance on current account .
Merchandise trade balance
Merchandise exports
Merchandise imports
Military transactions, net
Other service transactions, net
Investment income, net
U.S. government grants
U.S. government pensions and other transfers
Private remittances and other transfers
-101,142
-115,668
361,697
-477,365
-6,837
32,604
14,366
-10,773
-2,517
-12,316
1992
Q3
Q4
Ql
Q2r
Q3P
-5,903
-17,222
107,946
-125,168
-624
14,468
4,474
-2,620
-858
-3,521
-17,802
-24,558
107,464
-132,022
-623
13,261
1,930
-3,085
-1,146
-3,581
-14,238
-26,538
-137,350
-548
16,173
3,551
-2,490
-%9
-3,417
-90,428
-108,853
388,705
-497,558
-7,818
39,873
19,287
-17,597
-2,945
-12,374
-3,682
-73,436
415,%2
-489,398
-5,524
50,821
16,429
24,487
-3,462
-12,9%
-11,087
-20,174
104,151
-124,325
-995
13,018
3,076
-1,986
-793
-3,233
-7,218
-18,539
107,851
-126,390
-540
13,676
2,458
78
-1,080
-3,271
110,812
11 Change in U.S. government assets other than official
reserve assets, net (increase, - )
1,271
2,304
3,397
3,180
-437
-38
-277
-385
12 Change in U.S. official reserve assets (increase, —).
13 Gold
14 Special drawing rights (SDRs)
15 Reserve position in International Monetary Fund.
16 Foreign currencies
-25,293
0
-535
471
-25,229
-2,158
0
-192
731
-2,697
5,763
0
-177
-367
6,307
3,877
0
6
-114
3,986
1,225
0
-23
17
1,232
-1,057
0
-172
111
-9%
1,464
0
1,952
0
-173
-118
2,243
17 Change in U.S. private assets abroad (increase, - ) .
18 Bank-reported claims3
19 Nonbank-reported claims
20
U.S. purchases of foreign securities, net
21
U.S. direct investments abroad, net
-90,923
-51,255
11,398
-22,070
-28,9%
-56,467
7,469
-2,477
-28,765
-32,694
-71,379
-4,753
5,526
-45,017
-27,135
-17,426
2,403
-298
-12,403
-7,128
-44,947
-23,219
1,269
-11,305
-11,692
-3,155
15,859
4,764
-8,703
-15,075
-1,150
10,943
3,137
-8,221
-7,009
-21,724
-440
8,489
149
1,383
146
4,976
1,835
33,908
29,576
667
18,407
15,815
1,301
1,600
3,385
-1,586
-1,668
4,115
5,624
474
654
-2,732
95
12,819
12,619
1,075
-344
-914
383
21,192
14,909
540
%
5,534
113
20,895
11,126
1,699
598
7,547
-75
-7,738
-323
912
875
-8,202
-1,000
205,205
63,382
5,565
29,618
38,767
67,873
65,471
16,370
4,906
-2,534
1,592
45,137
48,573
-13,677
-405
16,241
34,918
11,498
18,818
-2,629
-4,474
1,942
-828
4,551
-3,820
26,520
-551
1,141
10,286
10,333
5,311
25,024
19,945
29
36,110
23,465
725
1,408
4,832
5,680
5,364
3,076
-3,361
0
2,394
0
47,370
0
-1,078
2,394
47,370
-1,078
0
-1,478
-6,137
4,659
0
2,447
613
1,835
0
-8,410
4,023
-12,433
0
-29,650
410
-30,060
0
17,109
-7,680
24,789
-25,293
-2,158
5,763
3,877
1,225
-1,057
1,464
1,952
8,343
32,042
16,807
3,461
13,163
21,0%
20,297
-8,613
2,459
-2,125
3,061
22 Change in foreign official assets in United States (increase, +)
23
U.S. Treasury securities
24 Other U.S. government obligations
25 Other
rtthor U.S.
1 I C government
finurnnunl liabilities
I i Q Ki Kl ^
26 Other U.S. liabilities reported by U.S. banks3
27 Other foreign official assets
28 Change in foreign private assets in United States (increase, + ) . .
29
U.S. bank-reported liabilities3
30
U.S. nonbank-reported liabilities
31
Foreign private purchases of U.S. Treasury securities, net
32
Foreign purchases of other U.S. securities, net
33 Foreign direct investments in United States, net
34 Allocation of special drawing rights
35 Discrepancy
36 Due to seasonal adjustment
37
Before seasonal adjustment
1,866
1,359
8,508
1,575
-1,306
10,012
-168
1
1,631
-i4,103
-7,181
MEMO
Changes in official assets
38 U.S. official reserve assets (increase, - )
39 Foreign official assets in United States, excluding line 25
(increase, +)
40 Change in Organization of Petroleum Exporting Countries
official assets in United States (part of line 22)
1. Seasonal factors not calculated for lines 12-16, 18-20, 22-34, and 38-40.
2. Data are on an international accounts basis. The data differ from the Census
basis data, shown in table 3.11, for reasons of coverage and timing. Military
exports are excluded from merchandise trade data and are included in line 6.
3. Reporting banks include all types of depository institution as well as some
brokers and dealers.
-5,604
4. Associated primarily with military sales contracts and other transactions
arranged with or through foreign official agencies.
5. Consists of investments in U.S. corporate stocks and in debt securities of
private corporations and state and local governments.
SOURCE. U.S. Department of Commerce, Survey of Current Business.
A54
3.11
International Statistics • February 1993
U . S . FOREIGN TRADE 1
Millions of dollars; monthly data seasonally adjusted
1992
Item
1 Exports of domestic and foreign
merchandise, (F.A.S. value),
excluding grant-aid shipments
2 General imports (customs value),
including merchandise for
immediate consumption plus entries
into bonded warehouses
3 Trade balance
1989
363,812
1990
393,592
1991
421,730
May r
June r
July r
Aug/
Sept/
Oct."
36,406
35,718
38,165
37,806
35,799
37,882
39,185
473,211
495,311
487,129
43,494
42,903
44,957
45,127
44,796
46,459
46,218
-109,399
-101,718
-65,399
-7,088
-7,185
-6,792
-7,322
-8,997
-8,577
-7,032
1. The Census basis data differ from merchandise trade data shown in table
3.10, lines 3-5, U.S. International Transactions Summary, because of coverage
and timing. On the export side, the largest difference is the exclusion of military
sales (which are combined with other military transactions and reported separately in table 3.10, line 6). On the import side, this table includes imports of gold,
ship purchases, imports of electricity from Canada, and other transactions;
military payments are excluded and shown separately in table 3.10, line 6. Since
3.12
Apr. r
Jan. 1, 1987, Census data have been released forty-five days after the end of the
month; the previous month is revised to reflect late documents. Total exports and
the trade balance reflect adjustments for undocumented exports to Canada.
Components may not sum to totals because of rounding.
SOURCE. FT900, Summary of U.S. Export and Import Merchandise Trade
(U.S. Department of Commerce, Bureau of the Census).
U.S. RESERVE ASSETS
Millions of dollars, end of period
1992
Asset
1 Total
2 Gold stock, including Exchange
Stabilization Fund 1
3 Special drawing rights 2,3
4 Reserve position in International
Monetary Fund
5 Foreign currencies 4
1989
1990
1991
June
July
Aug.
Sept.
Oct.
Nov. p
74,609
83,316
77,719
74,587
77,092
77,370
78,474
78,527
74,207
72,231
11,059
9,951
11,058
10,989
11,057
11,240
11,057
11,315
11,059
11,597
11,059
11,702
11,059
12,193
11,059
12,111
11,060
11,561
11,059
11,495
9,048
44,551
9,076
52,193
9,488
45,934
9,175
43,040
9,381
45,055
9,625
44,984
9,762
45,460
9,778
45,579
9,261
42,325
8,781
40,896
1. Gold held "under earmark" at Federal Reserve Banks for foreign and
international accounts is not included in the gold stock of the United States; see
table 3.13, line 3. Gold stock is valued at $42.22 per fine troy ounce.
2. Special drawing rights (SDRs) are valued according to a technique adopted
by the International Monetary Fund (IMF) in July 1974. Values are based on a
weighted average of exchange rates for the currencies of member countries. From
July 1974 through December 1980, 16 currencies were used; since January 1981,
3.13
May
5 currencies have been used. U.S. SDR holdings and reserve positions in the IMF
also have been valued on this basis since July 1974.
3. Includes allocations of SDRs by the International Monetary Fund on Jan. 1
of the year indicated, as follows: 1970—$867 million; 1971—$717 million; 1972—
$710 million; 1979—$1,139 million; 1980—$1,152 million; 1981—$1,093 million;
plus net transactions in SDRs.
4. Valued at current market exchange rates.
FOREIGN OFFICIAL ASSETS H E L D AT F E D E R A L R E S E R V E B A N K S 1
Millions of dollars, end of period
1992
Asset
1989
1990
1991
May
1 Deposits
Held in custody
2 U.S. Treasury securities
3 Earmarked gold
July
Aug.
Sept.
Oct.
Nov. p
589
369
968
217
219
264
297
546
415
229
224,911
13,456
278,499
13,387
281,107
13,303
307,562
13,295
307,337
13,268
316,431
13,261
318,328
13,261
306,971
13,241
311,538
13,201
308,959
13,192
1. Excludes deposits and U.S. Treasury securities held for international and
regional organizations.
2. Marketable U.S. Treasury bills, notes, and bonds and nonmarketable U.S.
Treasury securities payable at face value in dollars or foreign currencies.
June
3. Held for foreign and international accounts and valued at $42.22 per fine
troy ounce; not included in the gold stock of the United States.
Summary Statistics
3.14
FOREIGN BRANCHES OF U.S. BANKS
A55
Balance Sheet Data 1
Millions of dollars, end of period
1992
Apr.
May
June
July
Aug.
Sept.
Oct.
All foreign countries
ASSETS
545,366
556,925
548,901
549,858
564,816
564,466
537,529
544,815r
544,437"
553,564
2 Claims on United States
3
Parent bank
4
Other banks in United States
5 Nonbanks
6 Claims on foreigners
7 Other branches of parent bank
8
Banks
9
Public borrowers
10 Nonbank foreigners
11 Other assets
198,835
157,092
17,042
24,701
300,575
113,810
90,703
16,456
79,606
45,956
188,496
148,837
13,296
26,363
312,449
135,003
72,602
17,555
87,289
55,980
176,301
137,509
12,884
25,908
303,934
111,729
81,970
18,652
91,583
68,666
177,992
143,790
9,993
24,209
302,916
111,140
83,673
18,743
89,360
68,950
182,554
145,974
11,640
24,940
314,569
115,407
86,029
19,194
93,939
67,693
183,933
147,626
10,418
25,889
311,990
115,398
84,534
20,162
91,8%
68,543
171,911
136,287
9,576
26,048
311,578
112,177
85,141
19,645
94,615
54,040
163,039"
128,267"
9,181
25,591"
321,631"
116,674
87,347"
20,423
97,187
60,145"
167,258
134,019
8,083
25,156
319,115"
118,105"
83,912
20,485
%,613
58,064
174,921
138,907
10,658
25,356
318,833
115,525
86,820
20,789
95,699
59,810
12 Total payable in U.S. dollars
382,498
379,479
363,941
364,748
370,290
369,561
349,145
340,819"
346,633"
363,443
13 Claims on United States
14 Parent bank
15 Other banks in United States
16 Nonbanks
17 Claims on foreigners
18 Other branches of parent bank
19 Banks
20
Public borrowers
21
Nonbank foreigners
22 Other assets
191,184
152,294
16,386
22,504
169,690
82,949
48,396
10,961
27,384
21,624
180,174
142,962
12,513
24,699
174,451
95,298
36,440
12,298
30,415
24,854
169,662
133,476
12,025
24,161
167,010
78,114
41,635
13,685
33,576
27,269
173,337
141,264
9,255
22,818
162,%7
75,177
41,415
12,994
33,381
28,444
177,311
142,874
11,012
23,425
167,054
76,949
42,061
12,994
35,050
25,925
177,638
144,287
10,016
23,335
168,586
76,700
43,307
13,723
34,856
23,337
166,507
133,120
9,135
24,252
162,843
72,250
41,718
13,320
35,555
19,795
157,405"
124,737"
8,876
23,792"
161,500"
70,693
40,350"
13,661
36,7%
21,914"
161,302
130,346
7,476
23,480
166,360"
72,116"
42,281
13,%5
37,998
18,971
169,036
135,954
9,335
23,747
173,246
76,107
45,401
14,221
37,517
21,161
1 Total payable in any currency
United Kingdom
23 Total payable in any currency
161,947
184,818
175,599
170,775
174,925
171,027
159,317
165,832
161,157
167,472
24 Claims on United States
25
Parent bank
26
Other banks in United States
27
Nonbanks
28 Claims on foreigners
29
Other branches of parent bank
30
Banks
31
Public borrowers
32
Nonbank foreigners
33 Other assets
39,212
35,847
1,058
2,307
107,657
37,728
36,159
3,293
30,477
15,078
45,560
42,413
792
2,355
115,536
46,367
31,604
3,860
33,705
23,722
35,257
31,931
1,267
2,059
109,692
35,735
36,394
3,306
34,257
30,650
35,451
32,379
1,228
1,844
104,467
34,061
36,126
3,108
31,172
30,857
37,369
34,433
970
1,966
107,795
35,331
37,548
3,165
31,751
29,761
38,0%
35,343
756
1,997
104,270
36,952
34,783
2,995
29,540
28,661
38,763
35,542
1,065
2,156
105,990
35,359
36,777
3,128
30,726
14,564
37,511
34,593
744
2,174
108,895
37,732
37,711
3,046
30,406
19,426
35,891
32,929
1,067
1,895
106,758
37,977
36,1%
3,371
29,214
18,508
39,460
36,262
1,400
1,798
109,851
40,530
37,121
3,698
28,502
18,161
34 Total payable in U.S. dollars
103,208
116,762
105,974
102,285
104,392
102,737
98,828
99,610
100,449
106,608
36,404
34,329
843
1,232
59,062
29,872
16,579
2,371
10,240
7,742
41,259
39,609
334
1,316
63,701
37,142
13,135
3,143
10,281
11,802
32,418
30,370
822
1,226
58,791
28,667
15,219
2,853
12,052
14,765
33,298
31,022
853
1,423
54,129
25,922
14,829
2,545
10,833
14,858
35,185
33,059
677
1,449
56,615
27,482
15,348
2,463
11,322
12,592
35,376
33,751
627
998
56,888
28,541
15,380
2,474
10,493
10,473
36,133
33,936
785
1,412
56,264
26,751
15,930
2,653
10,930
6,431
34,948
32,786
625
1,537
55,812
26,825
15,565
2,353
11,069
8,850
33,618
31,578
711
1,329
59,099
27,986
16,808
2,604
11,701
7,732
37,072
34,979
769
1,324
61,489
30,218
17,394
2,518
11,359
8,047
35 Claims on United States
36
Parent bank
37
Other banks in United States
Nonbanks
38
39 Claims on foreigners
40
Other branches of parent bank
41
Banks
42
Public borrowers
Nonbank foreigners
43
44 Other assets
Bahamas and Cayman Islands
45 Total payable in any currency
176,006
162,316
168,326
162,871
167,139
168,963
153,691
144,089
145,450
153,853
46 Claims on United States
47
Parent bank
48
Other banks in United States
49
Nonbanks
50 Claims on foreigners
51
Other branches of parent bank
52
Banks
53
Public borrowers
54
Nonbank foreigners
55 Other assets
124,205
87,882
15,071
21,252
44,168
11,309
22,611
5,217
5,031
7,633
112,989
77,873
11,869
23,247
41,356
13,416
16,310
5,807
5,823
7,971
115,244
81,520
10,907
22,817
45,229
11,098
20,174
7,161
6,7%
7,853
112,080
82,823
8,115
21,142
41,929
10,156
18,406
6,332
7,035
8,862
115,633
84,041
9,729
21,863
42,828
9,311
19,658
6,459
7,400
8,678
114,467
83,316
9,118
22,033
45,600
9,392
21,548
7,084
7,576
8,8%
102,850
72,107
8,045
22,698
41,886
8,678
18,837
6,728
7,643
8,955
94,595
64,454
8,060
22,081
41,315
8,5%
17,570
7,125
8,024
8,179
%,750
68,209
6,562
21,979
41,712
7,753
18,412
7,102
8,445
6,988
102,619
72,185
8,174
22,260
42,514
7,287
19,680
7,120
8,427
8,720
56 Total payable in U.S. dollars
170,780
158,390
163,771
158,196
162,066
163,313
147,905
138,348
139,769
148,865
1. Since June 1984, reported claims held by foreign branches have been
reduced by an increase in the reporting threshold for "shell" branches from $50
million to $150 million equivalent in total assets, the threshold now applicable to
all reporting branches.
A56
3.14
International Statistics • February 1993
FOREIGN BRANCHES OF U.S. B A N K S
Balance Sheet Data 1 —Continued
1992
Account
1989
1990
1991
Apr.
May
July
Aug.
Sept.
Oct.
All foreign countries
LIABILITIES
57 Total payable in any currency
545,366
556,925
548,901
549,858
564,816
564,466
537,529
544,815R
544,437*
553,564
58 Negotiable certificates of deposit (CDs)
59 To United States
60
Parent bank
61
Other banks in United States
62
Nonbanks
23,500
197,239
138,412
11,704
47,123
18,060
189,412
138,748
7,463
43,201
16,284
198,121
136,431
13,260
48,430
12,757
196,635
138,273
15,075
43,287
14,010
198,897
136,195
13,944
48,758
13,040
204,929
143,474
14,009
47,446
12,758
192,087
133,051
11,833
47,203
14,246
179,246r
126,825r
10,928r
41,493
12,389
185,071*
127,656
12,303
45,112*
12,054
188,549
132,639
12,254
43,656
63 To foreigners
64
Other branches of parent bank . . .
65
Banks
66
Official institutions
67
Nonbank foreigners
68 Other liabilities
296,850
119,591
76,452
16,750
84,057
27,777
311,668
139,113
58,986
14,791
98,778
37,785
288,254
112,033
63,097
15,596
97,528
46,242
2%,580
111,846
65,177
16,083
103,474
43,886
308,394
115,098
68,528
19,465
105,303
43,515
302,376
116,760
65,983
16,399
103,234
44,121
301,943
114,226
65,419
18,058
104,240
30,741
314,910*
120,349*
68,565*
18,241
107,755*
36,413*
311,539*
119,634*
68,537*
16,724*
106,644
35,438*
315,610
117,986
70,583
20,564
106,477
37,351
69 Total payable in U.S. dollars
396,613
383,522
370,561
365,920
373,679
374,506
354,666
346,377*
346,344*
366,383
70 Negotiable CDs
71 To United States
72
Parent bank
73
Other banks in United States
74
Nonbanks
19,619
187,286
132,563
10,519
44,204
14,094
175,654
130,510
6,052
39,092
11.909
185,286
129,669
11,707
43.910
8,470
185,533
131,844
14,217
39,472
9,643
187,438
130,007
12,840
44,591
8,475
192,792
136,273
13,251
43,268
8,531
179,395
125,647
10,816
42,932
8,755
166,377*
119,370*
9,835
37,172
7,628
170,774*
119,797
11,012
39,965*
6,709
175,561
125,130
11,381
39,050
75 To foreigners
76
Other branches of parent bank . . .
77
Banks
78
Official institutions
79 Nonbank foreigners
80 Other liabilities
176,460
87,636
30,537
9,873
48,414
13,248
•179,002
98,128
20,251
7,921
52,702
14,772
158,993
76,601
24,156
10,304
47,932
14,373
157,139
75,772
22,577
10,413
48,377
14,778
162,011
76,973
24,090
13,102
47,846
14,587
158,532
77,604
23,474
10,119
47,335
14,707
155,352
73,699
22,955
11,543
47,155
11,388
157,475*
74,037
22,973
10,713
49,752*
13,770*
155,001*
72,947*
22,822*
9,939*
49,293
12,941*
167,698
77,331
26,320
12,085
51,962
16,415
United Kingdom
81 Total payable in any currency . .
161,947
184,818
175,599
170,775
174,925
171,027
159,317
165,832
161,157
167,472
82 Negotiable CDs
83 To United States
84
Parent bank
85
Other banks in United States
86
Nonbanks
20,056
36,036
29,726
1,256
5,054
14,256
39,928
31,806
1,505
6,617
11,333
37,720
29,834
1,438
6,448
7,324
36,610
29,317
2,011
5,282
8,458
33,236
25,637
1,638
5,961
7,612
36,660
28,201
1,326
7,133
7,731
37,164
29,104
1,315
6,745
8,083
35,527
27,695
1,632
6,200
7,266
35,885
27,528
1,670
6,687
6,062
35,431
27,430
1,342
6,659
87 To foreigners
88
Other branches of parent bank
89
Banks
90
Official institutions
91
Nonbank foreigners
92 Other liabilities
92,307
27,397
29,780
8,551
26,579
13,548
108,531
36,709
25,126
8,361
38,335
22,103
98,167
30,054
25,541
9,670
32,902
28,379
99,804
28,239
27,046
9,539
34,980
27,037
106,603
30,429
27,549
12,732
35,893
26,628
100,340
31,464
25,315
10,167
33,394
26,415
100,738
30,205
25,155
11,091
34,287
13,684
104,892
31,234
26,435
10,699
36,524
17,330
101,082
29,839
25,823
9,131
36,289
16,924
109,314
33,663
28,892
11,675
35,084
16,665
93 Total payable in U.S. dollars . . .
108,178
116,094
108,755
100,799
102,783
101,901
97,565
99,092
95,642
106,117
94 Negotiable CDs
95 To United States
%
Parent bank
97
Other banks in United States
98
Nonbanks
18,143
33,056
28,812
1,065
3,179
12,710
34,697
29,955
1,156
3,586
10,076
33,003
28,260
1,177
3,566
6,136
32,510
27,904
1,796
2,810
6,967
28,936
24,435
1,184
3,317
5,750
32,300
26,720
1,084
4,496
6,139
32,178
27,351
857
3,970
5,890
30,357
25,873
1,088
3,3%
5,689
30,330
25,700
992
3,638
4,212
31,279
26,023
866
4,390
99 To foreigners
100
Other branches of parent bank
101
Banks
102 Official institutions
103
Nonbank foreigners
104 Other liabilities
50,517
18,384
12,244
5,454
14,435
6,462
60,014
25,957
9,488
4,692
19,877
8,673
56,626
20,800
11,069
7,156
17,601
9,050
52,625
18,136
9,435
6,998
18,056
9,528
57,489
19,497
10,799
9,915
17,278
9,391
54,262
20,918
9,848
7,049
16,447
9,589
52,894
18,634
9,399
7,808
17,053
6,354
54,381
18,983
9,289
6,956
19,153
8,464
51,677
17,747
9,112
6,156
18,662
7,946
61,510
22,058
12,067
8,130
19,255
9,116
Bahamas and Cayman Islands
105 Total payable in any currency ..
176,006
162,316
168,326
162,871
167,139
168,963
153,691
144,089
145,450
153,853
106 Negotiable CDs
107 To United States
108 Parent bank
109 Other banks in United States
110 Nonbanks
678
124,859
75,188
8,883
40,788
646
114,738
74,941
4,526
35,271
1,173
129,872
79,394
10,231
40,247
1,546
124,605
76,086
12,060
36,459
1,646
128,891
76,779
11,085
41,027
1,894
130,815
80,998
11,708
38,109
1,330
115,589
67,356
9,641
38,592
1,814
105,816
64,039
8,491
33,286
872
108,983*
63,140
9,6%
36,147*
1,394
113,894
69,207
10,275
34,412
47,382
23,414
8,823
1,097
14,048
3,087
44,444
24,715
5,588
622
13,519
2,488
35,200
17,388
5,662
572
11,578
2,081
34,899
16,933
6,009
736
11,221
1,821
35,021
16,842
6,346
731
11,102
1,581
34,637
16,799
6,075
770
10,993
1,617
35,136
17,668
6,390
862
10,216
1,636
34,878
17,315
6,242
935
10,386
1,581
34,037*
16,071
6,787
984*
10,195
1,558*
34,889
15,441
6,987
1,058
11,403
3,676
171,250
157,132
163,603
158,247
162,280
163,951
148,744
138,864
111 To foreigners
112
Other branches of parent bank
113 Banks
114
Official institutions
115
Nonbank foreigners
116 Other liabilities
117 Total payable in U.S. dollars
139,963
148,881
Summary Statistics
3.15
A57
SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS
Millions of dollars, end of period
1992
Item
1 Total1
2
3
4
5
6
7
8
9
10
11
12
1990
1991
Apr.
May
June
July
Aug.
Sept.
Oct.P
344,529
360,546
385,572
394,709
401,795
404,052
406,557r
393,644r
405,250
By type
Liabilities reported by banks in the United States
U.S. Treasury bills and certificates
U.S. Treasury bonds and notes
Marketable
Nonmarketable
U.S. securities other than U.S. Treasury securities
39,880
79,424
38,412
92,692
44,583
102,968
47,471
111,224
51,421
109,278
48,883
114,781
52,078r
113,307
43,675r
113,634
60,773
104,2%
202,487
4,491
18,247
203,677
4,858
20,907
210,754
4,989
22,278
208,069
5,021
22,924
213,363
4,625
23,108
212,5%
4,582
23,210
213,293
4,476
23,403
208,810
4,505
23,020
211,810
4,473
23,898
By area
Western Europe 1
Canada
Latin America and Caribbean
Asia
Africa
,
Other countries
167,191
8,671
21,184
138,0%
1,434
7,955
168,365
7,460
33,554
139,465
2,092
9,608
179,239
7,855
39,130
148,573
2,392
8,381
185,416
9,347
39,732
149,062
2,792
8,358
191,214
9,302
39,433
150,215
3,265
8,364
194,351
9,876
39,146
150,047
3,218
7,412
195,947r
9,990
38,356
151,785r
2,860
7,617r
186,32ff
7,027
37,703
151,667r
3,360
7,565r
194,465
8,111
38,465
153,605
3,481
7,121
1. Includes the Bank for International Settlements.
2. Principally demand deposits, time deposits, bankers acceptances, commercial paper, negotiable time certificates of deposit, and borrowings under repurchase agreements.
3. Includes nonmarketable certificates of indebtedness (including those payable
in foreign currencies through 1974) and Treasury bills issued to official institutions
of foreign countries.
4. Excludes notes issued to foreign official nonreserve agencies. Includes
bonds and notes payable in foreign currencies; zero coupon bonds are included at
current value.
3.16
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.
SOURCE. Based on Treasury Department data and on data reported to the
Treasury Department by banks (including Federal Reserve Banks) and securities
dealers in the United States and on the 1984 benchmark survey of foreign portfolio
investment in the United States.
LIABILITIES TO, A N D CLAIMS ON, FOREIGNERS Reported by Banks in the United States 1
Payable in Foreign Currencies
Millions of dollars, end of period
1991
Item
1 Banks' liabilities
2 Banks' claims
3
Deposits
4
Other claims
5 Claims of banks' domestic customers
1988
74,980
68,983
25,100
43,884
364
1. Data on claims exclude foreign currencies held by U.S. monetary
authorities.
2. Assets owned by customers of the reporting bank located in the United
1989
67,835
65,127
20,491
44,636
3,507
1992
1990
70,477
66,7%
29,672
37,124
6,309
Dec.
Mar.
June
Sept.
75,129
73,318
26,192
47,126
3,274
67,874
60,844
23,269
37,575
2,862
70,764
58,968
23,462
35,506
4,428
85,166
73,185
29,419
43,766
3,908
States that represent claims on foreigners held by reporting banks for the accounts
of the domestic customers.
A58
3.17
International Statistics • February 1993
LIABILITIES TO FOREIGNERS
Payable in U.S. dollars
Reported by Banks in the United States'
Millions of dollars, end of period
1989
Apr.
May
June
July
Aug.
Sept. r
Oct.
HOLDER AND TYPE OF LIABILITY
1 Total, all foreigners
736,878
759,634
756,510
769,486
785,162
786,924
777,485
768,804 r
779,399
2 Banks' own liabilities
3
Demand deposits
4
Time deposits
5
Other 3
6
Own foreign offices 4
577,498
22,032
168,780
67,823
318,864
577,229
21,723
168,017
65,822
321,667
575,232
20,321
159,649
66,185
329,077
578,651
19,043
153,383
76,149
330,076
583,786
19,606
150,373
82,654
331,153
587,581
20,931
152,185
85,231
329,234
571,410
19,739
148,664
82,448
320,559
563,760 r
21,698
144,119"
86,301 r
311,642
585,424
22,474
143,762
82,119
337,069
159,380
91,100
182,405
%,796
181,278
110,734
190,835
120,924
201,376
130,392
199,343
128,672
206,075
135,579
205,044"
135,744
193,975
134,894
19,526
48,754
17,578
68,031
18,664
51,880
17,797
52,114
18,995
51,989
18,020
52,651
19,339
51,157
18,541
50,759"
18,814
40,267
4,894
3,279
%
8,981
6,827
43
2,714
4,070
10,291
8,408
29
1,819
6,560
11,313
9,358
46
2,520
6,792
12,771
10,548
40
3,788
6,720
11,281
12,584
9,477
927
2,255
5,918
4,540
36
1,050
3,455
2,630
6,826
10,554
7,917
24
2,521
5,372
1,616
197
1,378
364
2,154
1,730
1,883
1,442
1,955
1,461
2,223
1,687
3,129
2,602
3,107
2,654
2,637
1,991
1,417
2
1,014
0
424
0
441
0
494
0
534
2
527
0
453
0
646
0
113,481
31,108
2,1%
10,495
18,417
119,303
34,910
1,924
14,359
18,628
131,104
34,427
2,642
16,504
15,281
147,551
40.630
1,360
18.631
20,639
158,695
43,567
1,320
19,066
23,181
160,699
47,533
1,631
17,738
28,164
163,664
45,338
1,372
18,382
25,584
165,385"
48,526"
1,676
18,098"
28,752"
157,309
40,524
1,761
16,238
22,525.
82,373
76,985
84,393
79,424
%,677
92,692
106,921
102,968
115,128
111,224
113,166
109,278
118,326
114,781
116,859
113,307
116,785
113,634
5,028
361
4,766
203
3,879
106
3,812
141
3,717
187
3,602
286
3,459
86
3,466
86
2,922
229
515,275
454,273
135,409
10,279
90,557
34,573
318,864
540,805
458,470
136,802
10,053
88,541
38,208
321,667
522,424
459,177
130,100
8,632
82,857
38,611
329,077
522,084
456,309
126,233
8,753
79.632
37,848
330,076
527,455
460,919
129,766
9,229
77,098
43,439
331,153
526,472
459,710
130,476
9,705
80,170
40,601
329,234
514,723
448,111
127,552
8,442
77,382
41,728
320,559
502,079"
435,126"
123,484"
9,851
73,175"
40,458"
311,642
523,255
466,670
129,601
10,443
74,447
44,711
337,069
61,002
9,367
82,335
10,669
63,247
7,471
65,775
8,410
66,536
8,946
66,762
8,927
66,612
9,444
66,953
10,429
56,585
10,905
5,124
46,510
5,341
66,325
5,694
50,082
7,147
50,218
7,044
50,546
6,647
51,188
7,129
50,039
6,920
49,604
6,846
38,834
103,228
88,839
9,460
66,801
12,577
93,608
79,309
9,711
64,067
5,530
94,001
74,801
9,004
57,574
8,223
89,560
73,304
8,901
53,301
11,102
87,699
69,942
9,011
51,689
9,242
86,982
69,790
9,555
50,489
9,746
87,817
69,809
9,901
49,892
10,016
88,756"
70,631"
10,150
50,216"
10,265"
88,281
70,313
10,246
50,556
9,511
14,389
4,551
14,299
6,339
19,200
8,841
16,256
8,104
17,757
8,761
17,192
8,780
18,008
8,752
18,125"
9,354
17,%8
8,364
7,958
1,880
6,457
1,503
8,667
1,692
6,397
1,755
7,740
1,256
7,237
1,175
8,224
1,032
7,702
1,069"
8,400
1,204
7,203
7,073
7,456
7,624
7,642
7,351
6,976
7,279
6,964
7 Banks' custodial liabilities 5
8
U.S. Treasury bills and certificates 6
9
Other negotiable and readily transferable
instruments
10
Other
11 Nonmonetary international and regional
organizations 8
12
Banks' own liabilities
13
Demand deposits
14
Time deposits"
15
Other 3 .
16
17
18
19
5
Banks' custodial liabilities
U.S. Treasury bills and certificates 6
Other negotiable and readily transferable
instruments
Other
9
20 Official institutions
21
Banks' own liabilities
22
Demand deposits
23
Time deposits
24
Other 3
25
26
27
28
Banks' custodial liabilities 5
U.S. Treasury bills and certificates 6
Other negotiable and readily transferable
instruments
Other
10
29 Banks
30
Banks' own liabilities
31
Unaffiliated foreign banks
32
Demand deposits
33
Time deposits*
34
Other 3
35
Own foreign offices 4
36
37
38
39
Banks' custodial liabilities 5
U.S. Treasury bills and certificates 6
Other negotiable and readily transferable
instruments
Other
40 Other foreigners
41
Banks' own liabilities
42
Demand deposits
43
Time deposits"
44
Other 3
45
46
47
48
Banks' custodial liabilities 5
U.S. Treasury bills and certificates 6
Other negotiable and readily transferable
instruments
Other
8,152
24
3,008
5,120
21
MEMO:
49 Negotiable time certificates of deposit in custody for
foreigners
1. Reporting banks include all types of depository institution, as well as some
brokers and dealers.
2. Excludes negotiable time certificates of deposit, which are included in
" O t h e r negotiable and readily transferable instruments."
3. Includes borrowing under repurchase agreements.
4. For U.S. banks, includes amounts due to own foreign branches and foreign
subsidiaries consolidated in Consolidated Report of Condition filed with bank
regulatory agencies. For agencies, branches, and majority-owned subsidiaries of
foreign banks, consists principally of amounts due to head office or parent foreign
bank, and foreign branches, agencies, or wholly owned subsidiaries of head office
or parent foreign bank.
5. Financial claims on residents of the United States, other than long-term
securities, held by or through reporting banks.
6. Includes nonmarketable certificates of indebtedness and Treasury bills
issued to official institutions of foreign countries.
7. Principally bankers acceptances, commercial paper, and negotiable time
certificates of deposit.
8. Principally the International Bank for Reconstruction and Development, the
Inter-American Development Bank, and the Asian Development Bank. Excludes
"holdings of dollars" of the International Monetary Fund.
9. Foreign central banks, foreign central governments, and the Bank for
International Settlements.
10. Excludes central banks, which are included in "Official institutions."
Bank-Reported
Data
A59
3.17—Continued
1992
Item
1989
1990
1991
Apr.
May
June
July
Aug.
Sept.
Oct."
AREA
1 Total, all foreigners
736,878
759,634
756,510
769,486
785,162
786,924
777,485
768,804r
779,399'
777,655
2 Foreign countries
731,984
753,716
747,529
759,195
773,849
774,153
766,204
756,220'
768,845'
767,018
237,501
1,233
10,648
1,415
570
26,903
7,578
1,028
16,169
6,613
2,401
2,418
4,364
1,491
34,496
1,818
102,362
1,474
13,563
350
608
254,452
1,229
12,382
1,399
602
30,946
7,485
934
17,735
5,350
2,357
2,958
7,544
1,837
36,690
1,169
109,555
928
11,689
119
1,545
249,067
1,193
13,337
937
1,341
31,808
8,619
765
13,541
7,161
1,866
2,184
11,391
2,222
37,238
1,598
100,262
622
9,274
241
3,467
262,246
1,219
15,818
961
1,005
27,667
9,272
1,134
10,035
9,352
899
2,217
14,435
2,888
33,604
1,362
108,023
569
17,208
287
4,291
273,436
1,337
17,346
1,331
764
27,005
8,319
1,254
10,055
9,572
1,429
2,391
14,316
2,007
36,663
1,691
112,828
524
19,961
436
4,207
279,521
1,490
16,740
1,263
843
30,132
8,018
1,374
10,362
9,456
1,359
2,530
15,844
4,125
35,987
1,580
111,712
555
21,609
440
4,102
283,109
1,445
16,797
1,348
720
28,900
8,967
998
10,164
9,653
1,421
2,659
15,313
3,710
39,568
1,789
111,878
547
22,743
609
3,880
289,388'
1,427
18,449
1,329
976
29,456
11,032'
934
10,992
10,422
1,341
2,664
14,904
4,162
40,569'
2,021
111,521
554
21,872'
525
4,238
290,324'
1,456'
17,942
1,760
685
32,153'
14,739'
1,069
12,236
10,397
1,851
2,245
15,589
3,194'
39,314'
2,087
115,727'
567
12,867'
499
3,947
306,073
1,584
21,147
1,788
949
34,530
13,810
872
11,104
9,334
1,577
2,258
14,602
5,323
38,117
2,524
114,648
577
26,938
450
3,941
3 Europe
4 Austria
5 Belgium and Luxembourg
6 Denmark
7 Finland
8 France
9 Germany
10 Greece
11 Italy
12 Netherlands
13 Norway
14 Portugal
15 Spain
16 Sweden
17 Switzerland
18 Turkey
19 United Kingdom
20 Yugoslavia
21
Others in Western Europe 11
22
U.S.S.R
Other Eastern Europe
23
18,865
20,349
21,605
20,500
22,556
20,358
22,350
20,410
22,668
21,378
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
36 Jamaica
37 Mexico
38 Netherlands Antilles
39 Panama
40 Peru
41
Uruguay
42
Venezuela
43 Other
311,028
7,304
99,341
2,884
6,351
138,309
3,212
4,653
10
1,391
1,312
209
15,423
6,310
4,362
1,984
2,284
9,482
6,206
332,997
7,365
107,386
2,822
5,834
147,321
3,145
4,492
11
1,379
1,541
257
16,650
7,357
4,574
1,294
2,520
12,271
6,779
346,025
7,758
100,597
3,178
5,942
163,872
3,284
4,662
2
1,232
1,594
231
19,957
5,592
4,695
1,249
2,111
13,181
6,888
341,925
8,654
98,530
3,368
5,752
160,991
3,506
4,915
9
1,128
1,489
234
21,362
5,986
4,216
1,094
2,171
11,874
6,646
339,862
9,381
100,025
3,009
5,399
158,515
3,792
4,902
6
1,150
1,438
242
20,842
5,347
4,100
1,098
2,118
11,705
6,793
339,517
9,705
101,702
3,598
5,612
156,756
3,702
4,721
3
1,137
1,447
309
19,491
5,313
4,286
1,156
2,182
11,448
6,949
325,910
10,043
92,536
4,848
5,522
151,877
3,606
4,687
12
1,074
1,420
271
19,642
5,085
4,457
1,131
2,175
11,080
6,444
311,265'
9,397'
82,561
4,782
5,283'
148,450
3,393'
4,711
9
1,214
1,432
272
20,046
4,825
4,302
1,123
2,182'
10,802
6,481'
302,039'
9,065
69,073
4,255'
5,393
153,472
3,440
4,792'
33'
1,073
1,416
309
19,650
4,751
4,595
1,143
2,019
11,101
6,459
295,080
9,487
77,517
5,879
5,828
136,674
3,253
4,767
11
1,026
1,376
274
19,226
4,708
4,115
1,124
2,086
11,470
6,259
44 Asia
China
45
People's Republic of China
46
Republic of China (Taiwan)
47
Hong Kong
48
India
49
Indonesia
50
Israel
51 Japan
52 Korea (South)
53 Philippines
54 Thailand
55
Middle Eastern oil-exporting countries
56 Other
156,201
136,844
120,440
125,187
128,083
124,549
124,894
125,214
144,134
134,241
1,773
19,588
12,416
780
1,281
1,243
81,184
3,215
1,766
2,093
13,370
17,491
2,421
11,246
12,754
1,233
1,238
2,767
67,076
2,287
1,585
1,443
15,829
16,965
2,626
11,491
14,269
2,418
1,463
2,015
47,047
2,587
2,449
2,252
15,752
16,071
2,753
10,471
16,125
1,792
1,109
3,791
47,337
3,016
2,266
3,147
18,614
14,766
2,364
10,265
17,885
1,671
1,133
3,432
46,183
3,132
1,630
6,990
18,297
15,101
2,378
9,985
16,980
1,715
1,387
2,976
44,265
2,839
1,813
4,586
18,983
16,642
2,292
10,277
16,840
1,567
1,256
2,850
45,815
3,288
1,994
4,017
19,828
14,870
2,508
10,362
17,775
1,480
958
2,620
45,682
3,644
1,920
4,624
18,938
14,703
2,480
17,991
1,372
1,507
2,613
64,64c
3,672'
2,028
4,517
19,977
13,907'
2,582
8,504
17,486
1,234
1,315
2,208
56,058
3,531
2,275
5,082
19,040
14,926
57 Africa
58
Egypt
59
Morocco
60
South Africa
61
Zaire
62
Oil-exporting countries
63
Other
3,824
686
78
206
86
1,121
1,648
4,630
1,425
104
228
53
1,110
1,710
4,825
1,621
79
228
31
1,082
1,784
4,864
1,610
88
188
27
1,277
1,674
5,430
2,001
77
399
26
1,257
1,670
5,810
2,540
87
248
29
1,232
1,674
5,516
2,324
85
269
17
1,211
1,610
5,314
2,143
93
275
24
1,090
1,689
5,592
2,243
100
190
14
1,339
1,706
5,843
2,598
98
240
24
1,201
1,682
64 Other
65
Australia
66
Other
4,564
3,867
697
4,444
3,807
637
5,567
4,464
1,103
4,473
3,575
898
4,482
3,211
1,271
4,398
3,192
1,206
4,425
3,066
1,359
4,629
3,322
1,307
4,088
2,927
1,161
4,403
2,987
1,416
67 Nonmonetary international and regional
organizations
International 15
Latin American regional
Other regional
4,894
3,947
684
263
5,918
4,390
1,048
479
8,981
6,485
1,181
1,315
10,291
7,543
1,788
960
11,313
8,400
1,903
1,010
12,771
9,796
2,356
619
11,281
7,362
2,699
1,220
12,584
9,361
2,319
904
10,554'
7,458'
2,289'
807
10,637
7,590
2,139
908
24 Canada
68
69
70
11. Includes the Bank for International Settlements and Eastern European
countries not listed in line 23.
12. Comprises Bulgaria, Czechoslovakia, Hungary, Poland, and Romania.
13. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
14. Comprises Algeria, Gabon, Libya, and Nigeria.
15. Principally the International Bank for Reconstruction and Development.
Excludes "holdings of dollars" of the International Monetary Fund.
16. Principally the Inter-American Development Bank.
17. Asian, African, Middle Eastern, and European regional organizations,
except the Bank for International Settlements, which is included in "Other
Western Europe."
A60
3.18
International Statistics • February 1993
BANKS' OWN CLAIMS ON FOREIGNERS Reported by Banks in the United States 1
Payable in U.S. Dollars
Millions of dollars, end of period
Area and country
1989
1990
1991
Apr.
May
June
July
Aug.
Sept/
1 Total, all foreigners
534,492
511,543
514,318
506,854
504,682
511,951
503,051
479,602
2 Foreign countries
530,630
506,750
508,035
502,065
499,881
505,957
499,630
475,213 r
481,028
119,025
415
6,478
582
1,027
16,146
2,865
788
6,662
1,904
609
376
1,930
1,773
6,141
1,071
65,527
1,329
1,302
1,179
921
113,093
362
5,473
497
1,047
14,468
3,343
727
6,052
1,761
782
292
2,668
2,094
4,202
1,405
65,151
1,142
597
530
499
114,355
327
6,158
686
1,912
15,112
3,371
553
8,242
2,546
669
344
1,881
2,335
4,540
1,063
60,435
825
789
1,970
597
123,696
444
6,967
871
1,475
13,685
3,117
567
9,835
2,688
567
361
3,726
3,062
4,095
927
66,365
781
821
2,824
518
120,739
456
6,487
994
1,536
14,031
4,044
492
10,282
2,642
731
398
2,687
3,007
4,144
1,130
62,509
735
894
2,948
592
126,207
433
6,166
1,436
1,516
14,440
3,311
506
10,619
2,267
722
367
3,880
6,745
3,973
976
63,932
697
771
3,035
415
124,473
647
6,475
951
1,269
14,154
3,863
590
10,507
2,041
731
382
3,730
5,982
3,683
1,173
62.815
693
1,227
3,153
407
119,071"
606
6,324
901
1,081
13,011
4,707
619
9,876
2,075
707
387
2,590
6,567 r
3,934
l,002 r
58,826 r
678
l,356 r
3,280
544
117,178
341
7,504
1,007
1,299
15,004
4,074
606
9,487
1,980
639
383
3,304
5,494
3,112
984
56,421
674
1,216
3,199
450
3 Europe
4
Austria
5
Belgium and Luxembourg
6
Denmark
7
Finland
8
France
9
Germany
10
Greece
11
Italy
12
Netherlands
13
Norway
14
Portugal
15
Spain
16
Sweden
17
Switzerland
18
Turkey
19
United Kingdom
20
Yugoslavia
21
Others in Western Europe 2
22
U.S.S.R
23
Other Eastern Europe
24 Canada
r
485,199
15,451
16,091
15,094
15,121
16,460
16,401
17,438
15,151r
15,902
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
36
Jamaica
37
Mexico
38
Netherlands Antilles
39
Panama
40
Peru
41
Uruguay
42
Venezuela
43
Other
230,438
9,270
77,921
1,315
23,749
68,749
4,353
2,784
1
1,688
197
297
23,376
1,921
1,740
771
929
9,652
1,726
231,506
6,967
76,525
4,056
17,995
88,565
3,271
2,587
0
1,387
191
238
14,851
7,998
1,471
663
786
2,571
1,384
246,064
5,869
87,173
2,191
11,845
107,866
2,805
2,425
0
1,053
228
158
16,567
1,207
1,560
739
599
2,516
1,263
239,307
5,949
82,118
6,377
12,321
100,777
2,922
2,322
2
986
216
150
17,367
1,265
1,834
715
685
2,010
1,291
238,502
5,956
84,668
4,283
12,183
100,352
3,055
2,328
0
939
171
143
16,900
904
1,926
666
717
2,046
1,265
243,532
5,3%
83,141
4,951
12,020
106,676
3,227
2,304
0
936
173
150
16,455
920
2,199
719
765
2,215
1,285
234,119
5,614
74.816
6,099
12,186
104,188
3,118
2,398
0
950
167
151
16,331
941
2,025
708
749
2,360
1,318
217,549"
4,789
62,615
6,302
12,286
99,765 r
3,220"
2,322
0
949
189
150
16,541"
966
2,053
708
799
2,585
1,310"
210,251
4,560
58,502
3,567
11,308
99,239
3,320
2,475
0
920
237
160
17,290
1,045
1,945
732
921
2,654
1,376
44 Asia
China
45
People's Republic of China
46
Republic of China (Taiwan)
47
Hong Kong
48
India
49
Indonesia
50
Israel
51
Japan
52
Korea (South)
53
Philippines
54
Thailand
55
Middle Eastern oil-exporting countries
56
Other
157,474
138,722
125,288
116,770
117,259
112,406
115,961
116,494"
130,599
634
2,776
11,128
621
651
813
111,300
5,323
1,344
1,140
10,149
11,594
620
1,952
10,648
655
933
774
90,699
5,766
1,247
1,573
10,749
13,106
747
2,087
9,617
441
952
860
84,833
6,048
1,910
1,713
8,284
7,796
660
2,008
8,520
504
1,055
837
72,116
6,218
1,690
1,618
14,562
6,982
729
1,808
9,127
475
1,132
874
74,430
5,7%
1,618
1,703
13,453
6,114
685
1,778
8,272
458
1,085
888
69,269
5,927
1,648
1,756
14,505
6,135
642
1,965
9,103
512
1,090
901
71,159
6,063
1,635
1,705
14,323
6,863
696
1,983"
8,010
528
920
71,459"
6,201
1,775
1,691"
14,783
7,340
636
2.054
10,082
499
1,089
800
83,191
6,247
1,852
1,795
14,613
7,741
57 Africa
58
Egypt
59
Morocco
60
South Africa
61
Zaire
62
Oil-exporting countries
63
Other
5,890
502
559
1,628
16
1,648
1,537
5,445
380
513
1,525
16
1,486
1,525
4,928
294
575
1,235
4
1,298
1,522
4,818
242
547
1,239
4
1,160
1,626
4,582
218
529
1,128
4
1,162
1,541
4,548
256
527
1,070
4
1,159
1,532
4,452
261
496
1,047
4
1,157
1,487
4,455
243
483
1,066
4
1,130
1,529
4,333
256
467
1.055
4
1,067
1,484
64 Other
65
Australia
66
Other
2,354
1,781
573
1,892
1,413
479
2,306
1,665
641
2,353
1,424
929
2,339
1,197
1,142
2,863
1,725
1,138
3,187
1,937
1,250
2,493
1,463
1,030
2,765
1,765
1,000
67 Nonmonetary international and regional
organizations
3,862
4,793
6,283
4,789
4,801
5,994
3,421
4,389
4,171
1. Reporting banks include all types of depository institutions, as well as some
brokers and dealers.
2. Includes the Bank for International Settlements and Eastern European
countries not listed in line 23.
3. Comprises Bulgaria, Czechoslovakia, Hungary, Poland, and Romania.
1,108
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 E u r o p e . "
Nonbank-Reported
3.19
Data
BANKS' OWN A N D DOMESTIC CUSTOMERS' CLAIMS ON FOREIGNERS Reported by Banks in the
United States 1
Payable in U.S. Dollars
Millions of dollars, end of period
1992
Claim
1989
1990
1991
Apr.
May
506,854
34,585
302,551
120,195
70,703
49,492
49,523
504,682
34,637
308,342
116,823
70,205
46,618
44,880
June
July
Aug. r
503,051
32,926
302,066
114,045
63,004
51,041
54,014
479,602
32,263
287,523
105,8%
56,294
49,602
53,920
Sept. r
1 Total
593,087
579,044
579,622
2 Banks' claims
Foreign public borrowers
3
Own foreign offices
4
5
Unaffiliated foreign banks
Deposits
6
Other
7
8
All other foreigners
534,492
60,511
296,011
134,885
78,185
56,700
43,085
511,543
41,900
304,315
117,272
65,253
52,019
48,056
514,318
37,130
318,894
116,569
69,168
47,401
41,725
58,594
13,019
67,501
14,375
65,304
15,240
53,646
17,098
66,786
15,348
30,983
41,333
37,125
24,240
38,258
14,592
11,792
12,939
12,308
13,180
12,899
13,628
8,974
7,571
8,507
45,767
44,638
38,888
9 Claims of banks' domestic customers 3 ...
11
Negotiable and readily transferable
12
Outstanding collections and other
565,597
511,951
35,946
314,613
112,048
63,678
48,370
49,344
Oct."
551,985
485,199
31,474
297,540
105,6%
54,321
51,375
50,489
493,358
32,030
297,630
112,090
60,881
51,209
51,608
MEMO:
14 Dollar deposits in banks abroad,
reported by nonbanking business
enterprises in the United States . . . .
34,255
33,100 .
34,283r
32,757
33,010
n.a.
foreign bank, and foreign branches, agencies, or wholly owned subsidiaries of
head office or parent foreign bank.
3. Assets held by reporting banks for the account of their domestic customers.
4. Principally negotiable time certificates of deposit and bankers acceptances.
5. Includes demand and time deposits and negotiable and nonnegotiable
certificates of deposit denominated in U.S. dollars issued by banks abroad. For
description of changes in data reported by nonbanks, see Federal Reserve
Bulletin, vol. 65 (July 1979), p. 550.
1. For banks' claims, data are monthly; for claims of banks' domestic customers, data are quarterly.
Reporting banks include all types of depository institution, as well as some
brokers and dealers.
2. For U.S. banks, includes amounts due from own foreign branches and
foreign subsidiaries consolidated in Consolidated Report of Condition filed with
bank regulatory agencies. For agencies, branches, and majority-owned subsidiaries of foreign banks, consists principally of amounts due from head office or parent
3.20
32,963
BANKS' OWN CLAIMS ON UNAFFILIATED FOREIGNERS Reported by Banks in the United States 1
Payable in U.S. Dollars
Millions of dollars, end of period
1991
Maturity, by borrower and area
1988
1989
Dec.
1 Total
2
3
4
5
6
7
8
9
10
II
17
13
14
15
16
17
18
19
By borrower
Maturity of one year or less
Foreign public borrowers
All other foreigners
Maturity of more than one y e a r
Foreign public borrowers
All other foreigners
By area
n
Maturity of one year or less*
Europe
Canada
Latin America and Caribbean
Asia
Africa
All other 3
Maturity of more than one y e a r
Europe
Canada
Latin America and Caribbean
Asia
Africa
All other 3
Mar.
June
Sept. p
233,184
238,123
206,903
195,187
194,219
1%,934
187,277
172,634
26,562
146,072
60,550
35,291
25,259
178,346
23,916
154,430
59,776
36,014
23,762
165,985
19,305
146,680
40,918
22,269
18,649
162,515
21,047
141,468
32,672
15,866
16,806
161,266
20,241
141,025
32,953
16,344
16,609
162,473
20,491
141,982
34,461
15,144
19,317
155,022
17,786
137,236
32,255
13,340
18,915
55,909
6,282
57,991
46,224
3,337
2,891
53,913
5,910
53,003
57,755
3,225
4,541
49,184
5,450
49,782
53,258
3,040
5,272
51,875
6,474
43,521
51,007
2,549
7,089
52,608
6,926
48,597
43,605
2,486
7,044
54,977
7,946
49,204
41,386
2,142
6,818
55,785
5,973
45,295
40,699
2,199
5,071
4,666
1,922
47,547
3,613
2,301
501
4,121
2,353
45,816
4,172
2,630
684
3,859
3,290
25,774
5,165
2,374
456
3,883
3,546
18,264
4,459
2,335
185
4,355
3,250
18,180
4,738
2,191
239
6,786
3,173
16,891
5,007
2,341
263
6,663
3,243
15,133
4,847
2,091
278
1. Reporting banks include all kinds of depository institutions besides commercial banks, as well as some brokers and dealers.
1992
1990
2. Maturity is time remaining to maturity,
3. Includes nonmonetary international and regional organizations.
A61
A62
3.21
International Statistics • February 1993
CLAIMS ON FOREIGN COUNTRIES Held by U.S. Offices and Foreign Branches of U.S.-Chartered Banks 1
Billions of dollars, end of period
1990
Area or country
1 Total
1988
1991
1992
1989
Sept.
Dec.
Mar.
June
Sept.
Dec.
Mar.
June
Sept."
346.3
338.8
331.5
317.8
325.4
320.8
335.5
341.5
347.5
355.4
342.1
152.7
9.0
10.5
10.3
6.8
2.7
1.8
5.4
66.2
5.0
34.9
152.9
6.3
11.7
10.5
7.4
3.1
2.0
7.1
67.2
5.4
32.2
143.6
6.5
11.1
11.1
4.4
3.8
2.3
5.6
62.6
5.0
31.3
132.1
5.9
10.4
10.6
5.0
3.0
2.2
4.4
60.8
5.9
23.9
129.9
6.2
9.7
8.8
4.0
3.3
2.0
3.7
62.2
6.8
23.2
130.1
6.1
10.5
8.3
3.6
3.3
2.5
3.3
59.8
8.2
24.6
134.0
5.8
11.1
9.7
4.5
3.0
2.1
3.9
64.9
5.9
23.2
137.3
6.0
11.0
8.3
5.6
4.7
1.9
3.4
68.5
5.9
22.2
130.4
5.3
10.0
8.4
5.4
4.3
2.0
3.2
64.6
6.6
20.7
135.6
6.2
11.9
8.7
8.0
3.3
2.0
4.6
65.9
6.7
18.3
136.4
6.2
15.5
10.9
6.4
3.7
2.2
5.0
61.6
6.7
18.3
13 Other industrialized countries
14 Austria
15 Denmark
lb
Finland
11 Greece
18 Norway
19 Portugal
20
Spain
21
Turkey
22
Other Western Europe
South Africa
2i
24
Australia
21.0
1.5
1.1
1.1
1.8
1.8
.4
6.2
1.5
1.3
2.4
1.8
20.7
1.5
1.1
1.0
2.5
1.4
.4
7.1
1.2
.7
2.0
1.6
23.0
1.6
1.1
.8
2.8
1.6
.6
8.4
1.6
.7
1.9
2.0
22.6
1.4
1.1
.7
2.7
1.6
.6
8.3
1.7
.9
1.8
1.8
23.1
1.4
.9
1.0
2.5
1.5
.6
9.0
1.7
.8
1.8
1.9
21.1
1.1
1.2
.8
2.4
1.5
.6
7.1
1.9
.9
1.8
2.0
21.7
1.0
.9
.7
2.3
1.4
.5
8.3
1.6
1.0
1.6
2.4
22.7
.6
.9
.7
2.6
1.4
.6
8.3
1.4
1.6
1.9
2.7
21.2
.8
.8
.8
2.3
1.5
.5
7.7
1.2
1.3
1.8
2.3
25.4
.8
1.3
.8
2.8
1.7
.5
10.1
1.5
1.9
1.7
2.3
24.9
.7
1.5
1.0
3.0
1.6
.5
9.8
1.5
1.4
1.7
2.3
25 OPEC 2
2b
Ecuador
2/
Venezuela
28
Indonesia
29
Middle East countries
30
African countries
16.6
1.7
7.9
1.7
3.4
1.9
17.1
1.3
7.0
2.0
5.0
1.7
14.2
1.1
6.0
2.3
3.1
1.7
12.8
1.0
5.0
2.7
2.5
1.7
17.1
.9
5.1
2.8
6.6
1.6
14.0
.9
5.3
2.6
3.7
1.5
15.6
.8
5.6
2.8
5.0
1.5
14.6
.7
5.4
2.8
4.2
1.5
15.8
.7
5.4
3.0
5.3
1.4
16.2
.7
5.3
3.0
5.9
1.4
15.9
.7
5.4
3.0
5.4
1.4
31 Non-OPEC developing countries
85.3
77.5
67.1
65.4
66.4
65.0
65.0
64.3
70.6
68.8
73.8
9.0
22.4
5.6
2.1
18.8
.8
2.6
6.3
19.0
4.6
1.8
17.7
.6
2.8
5.0
15.4
3.6
1.8
12.8
.5
2.4
5.0
14.4
3.5
1.8
13.0
.5
2.3
4.7
13.9
3.6
1.7
13.7
.5
2.2
4.6
11.6
3.6
1.6
14.3
.5
2.0
4.5
10.5
3.7
1.6
16.2
.4
1.9
4.8
9.5
3.6
1.7
15.5
.4
2.1
5.0
10.8
3.9
1.6
18.2
.4
2.2
5.1
10.6
4.0
1.6
16.5
.4
2.2
6.2
10.8
4.2
1.7
17.7
.5
2.5
2 G-10 countries and Switzerland
3
Belgium and Luxembourg
4
France
5 Germany
6
Italy
1 Netherlands
8
Sweden
9
Switzerland
10
United Kingdom
11
Canada
12 Japan
32
33
34
35
36
3/
38
Latin America
Argentina
Brazil
Chile
Colombia
Mexico
Peru
Other
39
40
41
42
43
44
45
46
4/
Asia
China
Peoples Republic of China
Republic of China (Taiwan)
India
Israel
Korea (South)
Malaysia
Philippines
Thailand
Other Asia 3
.3
3.7
2.1
1.2
6.1
1.6
4.5
1.1
.9
.3
4.5
3.1
.7
5.9
1.7
4.1
1.3
1.0
.2
4.0
3.6
.6
6.2
1.8
3.9
1.5
1.6
.2
3.5
3.3
.5
6.2
1.9
3.8
1.5
1.7
.4
3.6
3.5
.5
6.8
2.0
3.7
1.6
2.1
.6
4.1
3.0
.5
6.9
2.1
3.7
1.7
2.3
.4
4.1
2.8
.5
6.5
2.3
3.6
1.9
2.3
.3
4.1
3.0
.5
6.8
2.3
3.7 ,
1.7
2.4
.3
4.8
3.6
.4
6.9
2.5
3.6
1.7
2.7
.3
4.6
3.8
.4
6.9
2.7
3.0
1.9
3.1
.3
5.0
3.6
.4
7.4
3.0
3.3
2.2
3.3
48
49
50
51
Africa
Egypt
Morocco
Zaire
Other Africa 3
.4
.9
.0
1.1
.4
.9
.0
1.0
.4
.9
.0
.8
.4
.8
.0
1.0
.4
.8
.0
.8
.4
.7
.0
.8
.4
.7
.0
.8
.4
.7
.0
.7
.3
.7
.0
.7
.5
.7
.0
.6
.3
.6
.0
.9
52 Eastern Europe
53
U.S.S.R
54
Yugoslavia
55
Other
3.6
.7
1.8
1.1
3.5
.7
1.6
1.3
2.7
.4
1.3
1.1
2.3
.2
1.2
.9
2.1
.3
1.0
.8
2.1
.4
1.0
.7
1.8
.4
.8
.7
2.4
.9
.9
.7
2.9
1.4
.8
.6
3.0
1.7
.7
.6
3.1
1.8
.7
.7
56 Offshore banking centers
il
Bahamas
58
Bermuda
59
Cayman Islands and other British West Indies
60
Netherlands Antilles
61
Panama 4
62
Lebanon
63
Hong Kong
64
Singapore
65
Other
44.2
11.0
.9
12.9
1.0
2.5
.1
9.6
6.1
.0
36.6
5.5
1.7
9.0
2.3
1.4
.1
9.7
7.0
.0
42.6
8.9
4.5
9.3
2.2
1.5
.1
8.7
7.5
.0
42.5
2.8
4.4
11.5
7.9
1.4
.1
7.7
6.6
.0
50.1
8.4
4.4
14.1
1.1
1.5
.1
11.6
8.9
.0
48.3
6.8
4.2
14.9
1.4
1.3
.1
12.4
7.2
.0
52.4
6.7
7.1
13.8
3.5
1.3
.1
12.1
7.7
.0
51.9
12.0
2.2
15.9
1.2
1.3
.1
12.2
7.1
.0
58.5
14.1
3.9
17.4
1.0
1.3
.1
12.2
8.5
.0
56.9
12.1
5.1
18,0
.8
1.4
.1
13.0
6.4
.0
49.5
7.5
3.8
15.4
.7
1.6
1
12.9
7.4
.0
66 Miscellaneous and unallocated 6
22.6
30.3
38.1
39.8
36.4
39.9
44.6
48.2
48.0
49.1
38.3
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 3.14 (the sum of lines 7 through 10) with the claims
of U.S. offices in table 3.18 (excluding those held by agencies and branches of
foreign banks and those constituting claims on own foreign branches).
Since June 1984, reported claims held by foreign branches have been reduced
by an increase in the reporting threshold for "shell" branches from $50 million to
$150 million equivalent in total assets, the threshold now applicable to all
reporting branches.
2. Organization of Petroleum Exporting Countries, shown individually; other
members of OPEC (Algeria, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar,
Saudi Arabia, and United Arab Emirates); and Bahrain and Oman (not formally
members of OPEC).
3. Excludes Liberia.
4. Includes Canal Zone beginning December 1979.
5. Foreign branch claims only.
6. Includes New Zealand, Liberia, and international and regional
organizations.
Nonbank-Reported
3.22
Data
A63
LIABILITIES TO UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in
the United States 1
Millions of dollars, end of period
1992
1991
Type and area or country
1988
1989
1990
Mar.
June
Sept.
Dec.
Mar.
June
1 Total
32,952
38,764
44,988
41,787
40,472
41,916
41,505
43,495
44,215"
2 Payable in dollars
3 Payable in foreign currencies
27,335
5,617
33,973
4,791
39,791
5,197
37,211
4,576
36,003
4,469
37,210
4,706
36,225
5,280
38,174
5,321
37,522"
6,693
By type
4 Financial liabilities
5
Payable in dollars
Payable in foreign currencies
6
14,507
10,608
3,900
17,879
14,035
3,844
20,010
15,984
4,026
18,606
15,266
3,340
18,260
14,947
3,313
20,350
16,675
3,675
20,242
16,242
4,000
21,664
17,566
4,098
22,043"
16,799"
5,244
18,445
6,505
11,940
16,727
1,717
20,885
8,070
12,815
19,938
947
24,977
10,683
14,294
23,807
1,170
23,181
8,793
14,388
21,945
1,236
22,212
8,569
13,644
21,056
1,157
21,566
8,313
13,253
20,535
1,031
21,263
8,310
12,953
19,983
1,280
21,831
8,914
12,917
20,608
1,223
22,172
9,500
12,672
20,723
1,449
9,962
289
359
699
880
1,033
6,533
11,660
340
258
464
941
541
8,818
10,346
394
700
621
1,081
516
6,395
9,559
335
632
561
1,036
517
5,810
9,634
355
556
658
1,026
484
5,932
11,403
397
1,747
652
1,050
468
6,521
10,814
217
1,593
649
1,056
360
6,294
12,071
174
1,997
636
1,025
355
6,977
13,091"
194
2,324
836
979
490"
7,392"
7 Commercial liabilities
8
Trade payables
9
Advance receipts and other liabilities
10 Payable in dollars
11 Payable in foreign currencies
12
13
14
15
16
17
18
By area or country
Financial liabilities
Europe
Belgium and Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
19
Canada
388
610
229
278
293
305
267
283
20
21
22
23
24
25
26
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
839
184
0
0
645
1
0
1,357
157
17
0
724
6
0
4,153
371
0
0
3,160
5
4
4,255
392
0
0
3,293
6
4
3,808
375
12
0
2,816
6
4
3,883
314
0
6
2,961
6
4
4,307
537
114
6
3,047
7
4
4,047
396
114
8
2,915
7
4
3,308"
343
114
10
2,167"
8
4
27
28
29
Asia
Japan
Middle East oil-exporting countries
3,312
2,563
3
4,151
3,299
2
4,872
3,637
5
4,510
3,432
1
4,515
3,339
4
4,755
3,605
19
4,796
3,557
13
5,168
3,906
13
5,218
4,122
10
30
Africa
2
0
2
0
2
0
2
0
9
7
3
2
6
4
7
6
0
0
4
100
409
2
2
1
52
88
89
7,319
158
455
1,699
587
417
2,079
9,071
175
877
1,392
710
693
2,620
10,310
275
1,218
1,270
844
775
2,792
9,666
261
1,203
1,383
729
661
2,755
8,607
245
1,185
1,040
729
580
2,289
8,084
225
992
911
751
492
2,217
7,808
248
830
944
709
488
2,310
7,491
256
671
878
574
482
2,444
7,131
240
659
691
605
400
2,404
1,217
1,124
1,261
1,251
1,208
1,011
990
1,094
1,077
1,672
12
538
145
30
475
130
1,589
14
494
216
35
343
129
1,619
5
504
180
49
358
119
1,512
14
450
211
46
291
102
1,352
3
310
219
107
304
94
1,701
13
493
230
108
375
168
1,803
8
409
212
73
475
279
31
32
33
34
35
36
37
38
39
40
Oil-exporting countries 3
All other 4
Commercial liabilities
Europe
Belgium and Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
337
41
42
43
44
45
46
47
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
1,090
49
286
95
34
217
114
1,224
41
308
100
27
323
164
48
49
50
Asia
Japan
Middle Eastern oil-exporting countries •
6,915
3,094
1,385
7,550
2,914
1,632
9,483
3,651
2,016
8,595
3,423
1,543
8,752
3,411
1,657
8,855
3,363
1,780
9,330
3,720
1,498
9,889
3,548
1,591
10,436
3,534
1,778
51
52
Africa
Oil-exporting countries
576
202
886
339
844
422
617
211
596
226
836
357
713
327
644
253
775
389
53
Other 4
1,328
1,030
1,406
1,464
1,431
1,268
1,070
1,012
950
1. For a description of the changes in the international statistics tables, see
Federal Reserve Bulletin, vol. 65, (July 1979), p. 550.
2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
3. Comprises Algeria, Gabon, Libya, and Nigeria.
4. Includes nonmonetary international and regional organizations.
5. Revisions include a reclassification of transactions, which also affects the
totals for Asia and the grand totals.
A64
3.23
International Statistics • February 1993
CLAIMS ON UNAFFILIATED FOREIGNERS
the United States 1
Reported by Nonbanking Business Enterprises in
Millions of dollars, end of period
1991
Type, and area or country
1989
1992
1990
Mar.
June
Sept.
Dec.
Mar.
June
1 Total
33,805
33,173
35,365
35,578
37,124
38,345
42,386
41,746
41,659r
2 Payable in dollars
3 Payable in foreign currencies
31,425
2,381
30,773
2,400
32,777
2,589
33,279
2,299
35,037
2,087
35,982
2,363
39,829
2,557
39,135
2,611
38,693r
2,966r
By type
4 Financial claims
Deposits
5
6
Payable in dollars
7
Payable in foreign currencies
Other financial claims
8
9
Payable in dollars
10
Payable in foreign currencies
21,640
15,643
14,544
1,099
5,997
5,220
777
19,297
12,353
11,364
989
6,944
6,190
754
19,891
13,727
12,552
1,175
6,164
5,297
866
19,746
13,115
12,052
1,063
6,631
5,960
671
20,904
12,576
11,758
817
8,328
7,656
673
22,566
16,227
15,182
1,045
6,339
5,641
698
25,320
17,177
16,253
924
8,143
7,322
821
25,029
16,819
15,626
1,193
8,210
7,521
689
24,606r
15,138r
13,795r
l,343 r
9,468 r
8,799r
669r
11 Commercial claims
12 Trade receivables
13 Advance payments and other claims
14 Payable in dollars
15
Payable in foreign currencies
12,166
11,091
1,075
11,660
505
13,876
12,253
1,624
13,219
657
15,475
13,657
1,817
14,927
548
15,832
13,843
1,989
15,266
566
16,220
14,120
2,100
15,623
597
15,779
13,429
2,350
15,159
620
17,066
14,389
2,677
16,254
812
16,717
14,168
2,549
15,988
729
17,053
14,594
2,459
16,099
954
10,278
18
203
120
348
217
9,039
8,463
28
153
152
238
153
7,4%
9,651
76
371
367
265
357
7,971
10,640
86
208
312
380
422
9,016
11,875
74
271
298
429
433
10,222
13,131
76
255
434
420
580
10,997
13,523
13
312
342
385
591
11,226
14,083
12
277
290
727
682
11,507
13,173r
25
786
381
732
779
8,739*
16
17
18
19
20
21
22
By area or country
Financial claims
Europe
Belgium and Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
23
Canada
2,325
1,904
2,934
1,929
2,017
2,172
2,674
2,744
2,534 r
24
25
26
27
28
29
30
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
8,160
1,846
19
47
5,763
151
21
8,020
1,890
7
224
5,486
94
20
6,201
1,090
3
68
4,635
177
25
6,278
825
6
68
4,949
179
28
5,926
457
4
127
4,957
161
29
6,289
652
19
137
5,106
176
32
7,793
758
8
192
6,300
321
40
6,836
400
12
191
5,748
318
34
7,260r
523
12
181
6,018r
343
32
31
32
33
Asia
Japan
Middle East oil-exporting countries 2 ..
623
354
5
590
213
8
860
523
8
568
246
11
747
398
4
619
277
3
%2
385
5
1,009
423
3
1,280
712
4
34
Africa
106
10
140
12
37
0
62
3
64
1
61
1
57
1
60
0
57
0
148
180
207
269
275
294
311
297
302
5,181
189
672
669
212
344
1,324
6,209
242
964
6%
479
313
1,575
7,044
212
1,240
807
555
301
1,775
7,060
227
1,273
874
604
325
1,639
7,464
220
1,402
958
707
2%
1,817
6,884
190
1,330
858
641
258
1,807
7,865
192
1,539
934
643
295
2,078
7,809
181
1,552
929
645
327
2,069
8,027
252
1,551
905
661
399
2,160
35
36
37
38
39
40
41
42
43
44
Oil-exporting countries 3
All other 4
Commercial claims
Europe
Belgium and Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
983
1,091
1,074
1,213
1,241
1,232
1,169
1,167
1,122
45
46
47
48
49
50
51
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
2,241
36
230
299
22
461
227
2,184
58
323
297
36
508
147
2,375
14
246
326
40
661
192
2,334
15
231
327
49
653
181
2,433
16
247
309
43
710
195
2,494
8
255
385
37
741
1%
2,590
11
263
418
41
828
202
2,564
11
272
361
45
889
206
2,636
9
291
431
32
847
248
52
53
54
Asia
Japan
Middle Eastern oil-exporting countries'
2,993
946
453
3,570
1,199
518
4,127
1,460
460
4,357
1,816
498
4,201
1,645
501
4,282
1,808
4%
4,552
1,861
622
4,326
1,770
636
4,433
1,778
606
55
56
Africa
Oil-exporting countries 3
435
122
429
108
488
67
394
68
428
63
431
80
418
95
417
75
419
70
333
393
367
474
454
456
472
434
416
57
Other
4
1. For a description of the changes in the international statistics tables, see
Federal Reserve Bulletin, vol. 65, (July 1979), p. 550.
2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
3. Comprises Algeria, Gabon, Libya, and Nigeria.
4. Includes nonmonetary international and regional organizations.
Securities Holdings and Transactions
3.24
A65
FOREIGN TRANSACTIONS IN SECURITIES
Millions of dollars
1992
Transaction and area or country
1990
1991
Jan.Oct.
Apr.
May
June
July
Aug.
Sept. r
Oct."
18,547
18,764
13,174
14,838
13,884
17,024
18,697
18,042
U.S. corporate securities
STOCKS
1 Foreign purchases
2 Foreign sales
173,293
188,419
211,204
200,116
180,615
189,364
17,536
18,034
18,664
18,602
3 Net purchases or sales (—)
-15,126
11,088
-8,749
-498
62
-1,012
-217
-1,664
-3,140
655
4 Foreign countries
-15,197
10,520
-8,755
-531
27
-1,170
-234
-1,619
-3,049
658
-8,479
-1,234
-367
-397
-2,866
-2,980
886
-1,330
-2,435
-3,477
-2,891
-63
-298
50
9
-63
-227
-131
-354
3,845
2,177
-134
4,255
1,179
153
174
-6,816
-1,127
-266
-484
-38
-4,357
1,188
1,142
66
-4,422
-4,022
34
53
-730
-217
-48
-38
90
-334
412
45
-95
-158
-318
-1
-4
278
-121
149
76
122
-11
230
43
85
-557
-401
20
-72
-1,184
-148
-4
-217
-10
-691
74
-109
51
141
35
-1
-142
-964
10
-14
-14
-55
-741
131
-24
4
373
174
-7
253
-1,089
-46
-26
-54
-150
-652
-59
-24
-11
-442
-301
-1
7
-1,675
-234
-105
-107
-189
-868
-278
-90
136
-1,062
-96
14
-94
62
-92
-52
-42
-124
365
-226
239
-55
779
192
-22
-119
71
568
6
33
35
158
17
-45
-91
-3
118,764
102,047
153,096
125,634
176,593
142,821
16,722
11,666
17,539
13,222
16,691
12,407
18,343
16,311
19,785r
16,620
17,180
14,465
18,433
14,591
21 Net purchases or sales (—)
16,717
27,462
33,772
5,056
4,317
4,284
2,032
3,165r
2,715
3,842
22 Foreign countries
17,187
27,592
33,363
4,861
4,388
4,205
2,153
3,150"
2,580
3,793
23
24
25
26
27
28
29
30
31
32
33
34
35
10,079
373
-377
172
284
10,383
1,906
4,328
3
1,120
727
96
-344
13,115
847
1,577
482
656
8,933
1,623
2,672
1,787
8,459
5,767
52
-116
16,110
1,019
1,760
339
-358
11,884
-7
7,823
2,332
7,145
-488
56
-96
2,003
363
391
-122
-393
1,543
87
572
338
1,778
687
19
64
1,920
-45
67
123
-40
1,496
-68
1,022
455
1,088
324
6
-35
1,420
364
11
64
-53
847
-111
619
376
1,904
740
-6
3
1,029
161
-37
177
-13
760
67
676
239
231
-710
22
-111
l,516r
-5
-13
22
-94
l,447 r
-100
878
284
593r
— 1,229"
1
-22
1,825
161
387
58
-51
1,320
48
548
-5
171
-590
-7
0
1,481
-2
-33
133
-23
1,067
198
885
314
967
470
-50
-2
-471
-131
409
195
-71
79
-121
135
49
5
6
7
8
9
10
11
12
13
14
15
16
17
Europe
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
Latin America and Caribbean
Middle East'
Other Asia
Japan
Africa
Other countries
18 Nonmonetary international and
regional organizations
16,525
17,537
BONDS 2
19 Foreign purchases
20 Foreign sales
Europe
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
Latin America and Caribbean
Middle East'
Other Asia
Japan
Africa
Other countries
36 Nonmonetary international and
regional organizations
15
Foreign securities
37 Stocks, net purchases or sales ( - )
38 Foreign purchases
39 Foreign sales
40 Bonds, net purchases or sales ( - )
41
Foreign purchases
42 Foreign sales
-9,205
122,641
131,846
-22,412
314,645
337,057
-31,967
120,598
152,565
-14,828
330,311
345,139
-23,968
125,208
149,176
-16,808
413,540
430,348
-2,295
11,336
13,631
-1,318
30,421
31,739
-913
13,871
14,784
-2,767
33,109
35,876
72
14,604
14,532
-1,626
40,145
41,771
-3,241
13,485
16,726
-4,747
43,226
47,973
-2,921 r
9,759"
12,680"
275"
45,929"
45,654"
-2,849
13,647
16,4%
-1,781
52,298
54,079
-4,144
12,424
16,568
-3,389
65,608
68,997
43 Net purchases or sales ( - ) , of stocks and bonds
-31,617
-46,795
-40,776
-3,613
-3,680
-1,554
-7,988
—2,646"
-4,630
-7,533
44 Foreign countries
-28,943
-46,711
-44,085
-4,768
-3,706
-1,938
-8,847
-2,733"
-4,651
-7,560
-8,443
-7,502
-8,854
-3,828
-137
-180
-34,452
-7,004
759
-7,350
-9
1,345
-29,374
-5,955
-1,607
-6,374
-87
-688
-2,972
-904
-845
122
9
-178
-163
-710
-1,278
-1,235
-99
-221
-1,437
-852
-556
372
7
528
-5,790
-2,212
1,622
-2,459
14
-22
-1,207"
207"
-430"
-1,375
11
61"
-3,273
-142
82
-1,659
-13
354
-7,166
-975
387
784
-2
-588
-2,673
-84
3,309
1,155
26
384
859
21
27
45
46
47
48
49
50
Europe
Canada
Latin America and Caribbean
Africa
Other countries
51 Nonmonetary international and
regional organizations
1. Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, Kuwait,
Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial States).
2. Includes state and local government securities and securities of U.S.
government agencies and corporations. Also includes issues of new debt securities sold abroad by U.S. corporations organized to finance direct investments
abroad.
87
3. In a July 1989 merger, the former stockholders of a U.S. company received
$5,453 million in shares of the new combined U.K. company. This transaction is
not reflected in the data.
A66
3.25
International Statistics • February 1993
MARKETABLE U.S. TREASURY BONDS A N D NOTES
Foreign Transactions
Millions of dollars
1992
Country or area
1990
1991
Jan.Oct.
Apr.
May
June
July
Aug.
Sept.
Oct."
Transactions, net purchases or sales ( - ) during period1
1 Estimated total2
2 Foreign countries
2
3 Europe 2
4 Belgium ^nd Luxembourg
5 Germany"
6 Netherlands
7 Sweden
8 Switzerland2
9
United Kingdom
10 Other Western Europe
11 Eastern Europe
12 Canada
13
14
15
16
17
18
19
20
Latin America and Caribbean
Venezuela
Other Latin America and Caribbean
Netherlands Antilles
Asia
Japan
Africa
Other
21 Nonmonetary international and regional organizations
22
International
23 Latin American regional
18,927
19,865
21,732
6,558
-7,924
14,448
-1,862
6,458r
—6,042r
3,658
18,764
19,687
20,570
7,579
-6,945
11,758
-2,286
6,785r
-6,251
4,465
18,455
10
5,880
1,077
1,152
112
-1,259
11,463
13
-4,627
8,663
523
-4,725
-3,735
-663
1,007
6,218
10,024
13
-3,019
9,258
1,640
2,762
-3,946
-1,128
-952
14,196
-3,746
432
1,748
3,207
21
441
-219
-123
10
2,820
257
0
185
-7,302
289
329
-338
-3
-579
-5,867
-1,099
-34
2,627
3,828
-49
824
227
372
3
1,664
587
200
47
-2,445
331
-829
-1,046
-26
-703
212
-581
197
2,520
3,450"
80
255
367
-1,289
-87
3,681r
428
15
900
-4,703
-25
900
-239
-843
292
-32
-4,761
5
-4,281
4,777
229
-8
-40
202
769
4,170
-544
-1
458
14,734
33
3,943
10,757
-10,952
-14,785
313
842
10,285
10
4,179
6,097
3,367
-4,081
689
-298
-6,057
501
-4,835
-1,723
18,445
4,179
984
-3,808
2,780
-124
3,723
-819
1,363
657
193
-149
-320
-196
-2,472
2,348
-2,406
1,085
40
416
3,589
-149
1,795
1,943
4,129
1,638
92
73
-2,869
216
-589
-2,4%
1,783
2,221
149
-1,424
-1,563
60
-758
-865
4,112r
l,887 r
56
-170
-1,479
31
-2,537
1,027
4,005
2,448
59
148
-2,002
155
-3,315
1,158
1,522
-393
-37
-253
163
287
-2
178
-358
-72
1,162
980
465
-1,021
-762
74
-979
-747
-4
2,690
2,421
127
424
365
-68
18,764
23,218
-4,453
19,687
1,190
18,496
20,570
8,133
12,437
7,579
1,712
5,867
-6,945
-2,685
-4,260
11,758
5,294
6,464
-2,286
-767
-1,519
6,785r
697
6,088r
-6,251
-4,483
-1,768
4,465
3,000
1,465
-387
0
-6,822
239
3,607
11
556
15
-3,061
0
947
-56
856
0
1,093
0
750
4
-69
0
-327 r
— 133r
—75
209"
-31"
201
-807
-903
217
MEMO
24 Foreign countries"
25 Official institutions
26 Other foreign
Oil-exportins countries
27 Middle East 3
28 Africa4
1. Official and private transactions in marketable U.S. Treasury securities
having an original maturity of more than one year. Data are based on monthly
transactions reports. Excludes nonmarketable U.S. Treasury bonds and notes
held by official institutions of foreign countries.
2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
3. Comprises Algeria, Gabon, Libya, and Nigeria.
Interest and Exchange Rates
3.26
A67
D I S C O U N T RATES OF FOREIGN C E N T R A L B A N K S 1
Percent per year
Rate on Dec. 31, 1992
Rate on Dec. 31, 1992
Percent
Austria..
Belgium .
Canada..
Denmark
France ..
8.0
7.75
7.36
9.5
9.0
Country
Month
effective
Oct.
Oct.
Dec.
Dec.
Dec.
1992
1992
1992
1991
1992
Percent
8.25
Germany...
Italy
Japan
Netherlands
12.0
3.25
7.75
1. Rates shown are mainly those at which the central bank either discounts or
makes advances against eligible commercial paper or government securities for
commercial banks or brokers. For countries with more than one rate applicable to
such discounts or advances, the rate shown is the one at which it is understood
that the central bank transacts the largest proportion of its credit operations.
3.27
Rate on Dec. 31, 1992
Country
Country
Month
effective
Month
effective
Sept. 1992
Dec. 1992
July 1992
Oct. 1992
Norway
Switzerland
United Kingdom
17.0
6.0
12.0
Nov. 1992
Sept. 1992
Sept. 1992
2. Since Feb. 1981, the rate has been that at which the Bank of France
discounts Treasury bills for seven to ten days.
FOREIGN SHORT-TERM INTEREST RATES 1
Averages of daily figures, percent per year
1992
Type or country
1
">
3
4
5
6
7
8 Italy
9
10
1990
8.16
14.73
13.00
8.41
8.71
8.57
10.20
12.11
9.70
7.75
1991
5.86
11.47
9.07
9.15
8.01
9.19
9.49
12.04
9.30
7.33
1992
3.71
9.57
6.76
9.42
7.68
9.26
10.14
13.91
9.31
4.39
1. Rates are for three-month interbank loans, with the following exceptions:
Canada, finance company paper; Belgium, three-month Treasury bills; and Japan,
CD rate.
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
3.87
9.94
6.03
9.66
9.04
9.45
9.98
13.38
9.50
4.60
3.40
10.10
5.58
9.69
8.67
9.50
10.11
15.54
9.54
4.32
3.33
10.27
5.15
9.79
8.09
9.73
10.27
15.27
9.71
3.87
3.15
9.86
5.33
9.37
7.20
9.23
10.51
17.54
9.44
3.89
3.30
8.23
7.57
8.85
6.28
8.63
10.82
15.52
8.70
3.85
3.67
7.16
7.63
8.84
6.44
8.66
9.58
14.38
8.64
3.77
3.51
7.12
7.96
8.93
6.16
8.57
10.74
13.65
8.65
3.76
A68
3.28
International Statistics • February 1993
FOREIGN EXCHANGE RATES 1
Currency units per dollar except as noted
1992
Country/currency unit
1990
1991
1992
July
1
2
3
4
5
6
7
8
9
10
Australia/dollar^
Austria/schilling
Belgium/franc
Canada/dollar
China, P.R./yuan
Denmark/krone
Finland/markka
France/franc
Germany/deutsche mark
Greece/drachma
11
12
13
14
15
16
17
18
19
20
Hong Kong/dollar
India/rupee
Ireland/pound
Italy/lira
Japan/yen
Malaysia/ringgit
Netherlands/guilder
New Zealand/dollar 2
Norway/krone
Portugal/escudo
21
22
23
24
25
26
27
28
29
30
Singapore/dollar
South Africa/rand
South Korea/won
Spain/peseta
Sri Lanka/rupee
Sweden/krona
Switzerland/franc
Taiwan/dollar
Thailand/baht
United Kingdom/pound
Aug.
Sept.
Oct.
Nov.
Dec.
78.069
11.331
33.424
1.1668
4.7921
6.1899
3.8300
5.4467
1.6166
158.59
77.872
11.686
34.195
1.1460
5.3337
6.4038
4.0521
5.6468
1.6610
182.63
73.540
10.990
32.143
1.2083
5.5195
6.0363
4.4835
5.2926
1.5616
190.71
74.507
10.500
30.717
1.1924
5.4564
5.7409
4.0803
5.0321
1.4914
182.89
72.479
10.199
29.824
1.1907
5.4417
5.5851
3.9773
4.9119
1.4475
179.12
72.255
10.214
29.917
1.2225
5.5048
5.6203
4.4764
4.9378
1.4514
182.70
71.481
10.436
30.581
1.2453
5.5486
5.7278
4.7096
5.0370
1.4851
192.50
68.984
11.168
32.661
1.2674
5.6134
6.1166
5.0615
5.3706
1.5875
206.48
68.974
11.130
32.545
1.2725
5.8106
6.1206
5.1444
5.3974
1.5822
209.48
7.7899
17.492
165.76
1,198.27
145.00
2.7057
1.8215
59.619
6.2541
142.70
7.7712
22.712
161.39
1,241.28
134.59
2.7503
1.8720
57.832
6.4912
144.77
7.7402
28.152
170.45
1,231.20
126.79
2.5460
1.7584
53.802
6.2112
135.02
7.7341
28.564
178.76
1,129.83
125.88
2.4999
1.6819
54.609
5.8581
126.24
7.7318
28.464
183.26
1,100.00
126.23
2.4977
1.6322
54.057
5.7120
124.98
7.7298
28.476
181.90
1,176.21
122.60
2.5029
1.6348
54.112
5.8116
127.86
7.7298
28.477
177.19
1,309.64
121.17
2.5044
1.6717
53.943
6.0562
132.33
7.7348
28.474
166.17
1,364.45
123.88
2.5227
1.7862
51.9%
6.4714
141.71
7.7416
28.979
166.71
1,412.38
124.04
2.5710
1.7788
51.570
6.6804
142.05
1.8134
2.5885
710.64
101.96
40.078
5.9231
1.3901
26.918
25.609
178.41
1.7283
2.7633
736.73
104.01
41.200
6.0521
1.4356
26.759
25.528
176.74
1.6293
2.8516
784.55
102.33
43.994
5.8208
1.4061
25.159
25.410
176.73
1.6142
2.7577
789.93
94.88
44.014
5.4084
1.3347
24.783
25.293
191.77
1.6077
2.7629
792.56
93.05
44.050
5.2745
1.2966
25.120
25.265
194.34
1.5988
2.8037
788.76
98.19
44.159
5.3685
1.2780
25.227
25.209
184.65
1.6081
2.8923
786.79
105.74
44.276
5.6006
1.3176
25.278
25.253
165.29
1.6338
2.9959
787.09
113.83
44.404
6.2528
1.4291
25.405
25.462
152.68
1.6397
3.0140
791.75
112.95
45.046
6.8903
1.4219
25.452
25.488
155.10
89.09
89.84
86.58
82.57
80.97
81.98
85.03
90.04
90.50
MEMO
31 United States/dollar 3
1. Averages of certified noon buying rates in New York for cable transfers.
Data in this table also appear in the Board's G.5 (405) monthly statistical release.
For ordering address, see inside front cover.
2. Value in U.S. cents.
3. Index of weighted-average exchange value of U.S. dollar against the
currencies of ten industrial countries. The weight for each of the ten countries is
the 1972-76 average world trade of that country divided by the average world
trade of all ten countries combined. Series revised as of August 1978 (see Federal
Reserve Bulletin, vol. 64, August 1978, p. 700).
A69
Guide to Statistical Releases and Special Tables
STATISTICAL RELEASES—List
Published Semiannually, with Latest
BULLETIN
Reference
Issue
December 1992
Anticipated schedule of release dates for periodic releases
SPECIAL TABLES—Quarterly
Data Published Irregularly, with Latest
BULLETIN
Page
A78
Reference
Title and Date
Issue
Page
Assets and liabilities of commercial banks
December 31, 1991
March 31, 1992
June 30, 1992
September 30, 1992
May
August
November
February
1992
1992
1992
1993
A70
A70
A70
A70
Terms of lending at commercial banks
February 1992
May 1992
August 1992
November 1992
September
September
November
February
1992
1992
1992
1993
A74
A78
A76
A76
Assets and liabilities of U.S. branches and agencies of foreign banks
December 31, 1991
March 31, 1992
June 30, 1992
September 30, 1992
May
September
November
February
1992
1992
1992
1993
A76
A82
A80
A80
Pro forma balance sheet and income statements for priced service operations
June 30, 1991
September 30, 1991
March 30, 1992
June 30, 1992
November
January
August
October
1991
1992
1992
1992
A80
A70
A80
A70
Assets and liabilities of life insurance companies
June 30, 1991
September 30, 1991
December 31, 1991
December 1991
May 1992
August 1992
A79
A81
A83
Special tables follow.
A70
4.20
Special Tables • February 1993
DOMESTIC A N D FOREIGN OFFICES Insured Commercial Bank Assets and Liabilities 1
Consolidated Report of Condition, September 30, 1992
Millions of dollars except as noted
Banks with foreign offices 2
Banks with domestic
offices only
Total
Item
1 Total assets4
2 Cash and balances due from depository institutions
3
Cash items in process of collection, unposted debits, and currency and coin
4
Cash items in process of collection and unposted debits
Currency and coin
5
6
Balances due from depository institutions in the United States
7
Balances due from banks in foreign countries and foreign central banks
Balances due from Federal Reserve Banks
8
Total
Foreign
Domestic
Over 100
Under 100
3,460,013
1,916,854
448,717
1,551,633
1,185,437
357,723
264,387
182,463
75,014
n.a.
n.a.
26,341
66,177
14,931
81,399
1,885
n.a.
n.a.
17,723
61,536
255
101,064
73,128
57,106
16,023
8,619
4,641
14,676
61,930
33,306
21,590
11,716
16,234
2,045
10,345
19,994
4
T
1
n.a.
1
•
4
T
1
n.a.
i
•
MEMO
9 Non-interest-bearing balances due from commercial banks in the United States
(included in balances due from depository institutions in the United States)
n.a.
n.a.
2,873,676
1,487,255
n.a.
751,484
311,315
n.a.
10 Total securities, loans and lease financing receivables, net
11 Total securities, book value
12
U.S. Treasury securities and U.S. government agency and corporation
obligations
13
U.S. Treasury securities
14
U.S. government agency and corporation obligations
15
All holdings of U.S. government-issued or guaranteed certificates of
participation in pools of residential mortgages
16
All other
17 Securities issued by states and political subdivisions in the United States
18 Other domestic debt securities
19
All holdings of private certificates of participation in pools of
residential mortgages
20
All other domestic debt securities
21
Foreign debt securities
22 Equity securities
23
Marketable
24
Investments in mutual funds
25
Other
26
LESS: Net unrealized loss
27
Other equity securities
29,550
12,943
7,946
1,063,329
323,092
281,765
319,798
120,371
%,449
n.a.
n.a.
6,229
n.a.
585,665
n.a.
n.a.
232,892
87,038
145,854
4,063
2,559
1,504
228,829
84,479
144,350
256,324
108,697
147,627
154,346
n.a.
71,574
n.a.
75,618
70,236
21,071
26,628
1,198
306
577
285
74,420
69,930
20,493
26,343
58,899
88,728
34,501
23,574
19,829
n.a.
16,002
n.a.
3,255
53,355
n.a.
12,524
6,183
4,335
1,907
59
6,341
1,796
24,832
24,776
5,947
2,143
1,295
851
3
3,805
0
285
23,395
1,230
340
30
310
0
890
1,796
24,547
1,381
4,718
1,803
1,264
542
3
2,915
1,309
22,264
335
5,065
2,945
2,072
902
29
2,120
150
6,259
n.a.
1,511
1,096
968
154
26
415
151,704
125,870
25,834
2,034,805
9,175
2,025,630
54,831
311
1,970,488
80,158
59,218
20,940
1,135,3%
3,519
1,131,877
35,785
311
1,095,782
348
n.a.
n.a.
212,997
1,130
211,867
n.a.
n.a.
n.a.
79,810
n.a.
n.a.
922,399
2,389
920,010
n.a.
n.a.
n.a.
54,559
49,839
4,720
708,%7
4,223
704,744
15,771
0
688,972
16,987
16,813
174
190,442
1,433
189,009
3,275
0
185,734
860,259
397,656
23,058
39,742
n.a.
n.a.
n.a.
•
30,222
10,746
714
18,763
16,309
728
29
15,552
374,599
51,472
2,153
202,379
38,867
163,513
12,168
106,426
13,913
10,017
685
3,211
359,592
29,458
7,195
193,203
31,253
161,950
12,649
117,087
9,370
8,675
374
321
103,011
6,251
10,553
56,759
3,151
53,608
2,156
27,292
150
n.a.
n.a.
n.a.
36,598
536,367
n.a.
n.a.
1,835
n.a.
n.a.
5,198
377,267
299,079
78,189
1,402
374
1,028
353
98,207
22,531
75,676
947
7
940
4,845
279,060
276,548
2,513
455
367
88
11,383
127,201
126,718
484
287
n.a.
n.a.
20,017
31,899
n.a.
n.a.
145
n.a.
n.a.
378,755
129,681
249,074
171,613
65,450
106,163
21,654
n.a.
n.a.
149,959
n.a.
n.a.
174,%7
62,3%
112,571
32,175
1,835
30,340
59 Obligations (other than securities) of states and political subdivisions in the United
States (includes nonrated industrial development obligations)
60
Taxable
61
Tax-exempt
62 All other loans
63
Loans to foreign governments and official institutions
64
Other loans
65
Loans for purchasing and carrying securities
66
All other loans
26,376
1,985
24,391
119,788
n.a.
n.a.
n.a.
n.a.
14,325
1,409
12,916
109,106
24,385
84,721
n.a.
n.a.
291
156
135
48,103
23,486
24,617
n.a.
n.a.
14,035
1,253
12,782
61,003
900
60,104
15,492
44,611
10,732
528
10,204
9,409
79
9,330
2,033
7,297
1,318
48
1,270
1,273
n.a.
n.a.
n.a.
n.a.
67
68
69
70
71
72
73
74
75
35,085
88,610
52,896
28,537
3,576
16,374
n.a.
14,507
117,450
28,606
86,668
28,464
18,033
3,078
16,003
n.a.
8,664
86,227
4,076
48,498
24,530
38,049
n.a.
n.a.
n.a.
n.a.
51,994
n.a.
n.a.
6,025
1,785
18,550
8,568
432
354
n.a.
5,427
25,061
454
157
5,882
1,936
67
17
n.a.
416
6,162
28
29
30
31
32
33
34
35
36
Federal funds sold and securities purchased under agreements to resell
Federal funds sold
Securities purchased under agreements to resell
Total loans and lease financing receivables, gross
. LESS: Unearned income on loans
Total loans and leases (net of unearned income)
LESS: Allowance for loan and lease losses
LESS: Allocated transfer risk reserves
EQUALS: Total loans and leases, net
Total loans, gross, by category
37 Loans secured by real estate
38
Construction and land development
39
Farmland
40
One- to four-family residential properties
41
Revolving, open-end loans, extended under lines of credit
42
All other loans
43
Multifamily (five or more) residential properties
44
Nonfarm nonresidential properties
45 Loans to depository institutions
46
Commercial banks in the United States
47
Other depository institutions in the United States
48
Banks in foreign countries
4
T
1
n.a.
1
1
t
49
50
51
52
53
54
55
56
Loans to finance agricultural production and other loans to farmers
Commercial and industrial loans
U.S. addressees (domicile)
Non-U.S. addressees (domicile)
Acceptances of other banks
U.S. banks
Foreign banks
Loans to individuals for household, family, and other personal expenditures (includes
purchased paper)
57
Credit cards and related plans
58
Other (includes single payment and installment)
Lease financing receivables
Assets held in trading accounts
Premises and fixed assets (including capitalized leases)
Other real estate owned
Investments in unconsolidated subsidiaries and associated companies
Customers' liability on acceptances outstanding
Net due from own foreign offices, Edge and agreement subsidiaries, and IBFs
Intangible assets
Other assets
j
4
T
1
n.a.
1
1
i
T
1
n.a.
1
1
?
i
T
1
n.a.
1
1
•
Commercial Banks
A71
4.20—Continued
Banks with foreign offices 2
Banks with domestic
offices only
Total
Total
Foreign
Domestic
Over 100
Under 10C
76 Total liabilities, limited-life preferred stock and equity capital
,460,013
1,916,854
n.a.
n.a.
1,185,437
357,723
77 Total liabilities5
78
Limited-life preferred stock
,204,377
7
1,791,578
0
448,711
n.a.
1,426,363
n.a.
1,089,031
5
323,768
2
79 Total deposits
80
Individuals, partnerships, and corporations
81
U.S. government
82
States and political subdivisions in the United States
83 Commercial banks in the United States
84
Other depository institutions in the United States
85
Banks in foreign countries
86
Foreign governments and official institutions
87
Certified and official checks
88
Allother 6
,627,921
1,336,385
1
n.a.
I
n.a.
I
301,866
188,954
i
1
n.a.
I
19,621
10,782
n.a.
975,732
911,437
1,710
43,577
8,054
4,328
137
n.a.
6,429
n.a.
315,804
290,934
499
19,800
1,269
1,274
n.a.
20,824
19,197
n.a.
1,034,519
955,917
4,113
33,092
20,345
3,252
6,931
59
9,665
n.a.
89 Total transaction accounts
90
Individuals, partnerships, and corporations
91
U.S. government
92
States and political subdivisions in the United States
93
Commercial banks in the United States
94
Other depository institutions in the United States
95
Banks in foreign countries
%
Foreign governments and official institutions
97
Certified and official checks
98
All other
349,225
295,692
2,301
12,846
18,612
2,592
6,559
957
9,665
n.a.
278,846
247,889
1,458
15,666
6,013
1,254
127
11
6,429
n.a.
87,677
77,513
400
6,989
608
164
n.a.
n.a.
1,985
18
99 Demand deposits (included in total transaction accounts)
100 Individuals, partnerships, and corporations
101
U.S. government
102
States and political subdivisions in the United States
103 Commercial banks in the United States
104 Other depository institutions in the United States
105
Banks in foreign countries
106 Foreign governments and official institutions
107 Certified and official checks
108 All other
109 Total nontransaction accounts
110 Individuals, partnerships, and corporations
111
U.S. government
112 States and political subdivisions in the United States
113 Commercial banks in the United States
114
U.S. branches and agencies of foreign banks
115
Other commercial banks in the United States
116 Other depository institutions in the United States
117 Banks in foreign countries
118
Foreign branches of other U.S. banks
119
Other banks in foreign countries
120 Foreign governments and official institutions
121 All other
253,719
204,976
2,255
8,107
18,612
2,592
6,556
956
9,665
n.a.
685,295
660,225
1,811
20,246
1,733
104
1,629
660
372
53
319
247
n.a.
157,324
136,226
1,312
6,007
5,990
1,237
111
11
6,429
n.a.
696,886
663,548
252
27,911
2,041
124
1,917
3,074
10
6
4
49
n.a.
41,847
36,909
388
1,783
605
160
n.a.
n.a.
1,985
17
228,126
213,422
99
12,811
661
n.a.
n.a.
1,111
n.a.
n.a.
n.a.
n.a.
24
122
123
124
125
126
127
128
129
130
131
Federal funds purchased and securities sold under agreements to repurchase —
Federal funds purchased
Securities sold under agreements to repurchase
Demand notes issued to the U.S. Treasury
Other borrowed money
Banks' liability on acceptances executed and outstanding
Notes and debentures subordinated to deposits
Net due to own foreign offices, Edge and agreement subsidiaries, and IBFs
All other liabilities
Total equity capital 7
132
133
134
135
136
137
Holdings of commercial paper included in total loans, gross
Total individual retirement accounts (IRA) and Keogh plan accounts
Total brokered deposits
Total brokered retail deposits
Issued in denominations of $100,000 or less
Issued in denominations greater than $100,000 and participated out by the
broker in shares of $100,000 or less
Money market deposit accounts (savings deposits; MMDAs)
Other savings deposits (excluding MMDAs)
Total time deposits of less than $100,000
Time certificates of deposit of $100,000 or more
Open-account time deposits of $100,000 or more
AH negotiable order of withdrawal (NOW) accounts (including Super N O W s ) . . .
Total time and savings deposits
i
145
146
147
148
149
150
151
i
\
1,204
1,117
92,175
n.a.
n.a.
249,032
163,473
85,559
n.a.
136,386
16,441
30,082
n.a.
110,472
255,629
181,121
124,427
56,694
n.a.
111,029
16,070
28,307
n.a.
91,196
125,275
418
n.a.
n.a.
n.a.
47,062
3,664
n.a.
n.a.
n.a.
n.a.
180,704
n.a.
n.a.
27,470
63,968
12,405
n.a.
31,502
n.a.
n.a.
64,647
37,474
27,174
6,185
24,183
354
1,686
n.a.
16,242
96,401
3,264
1,572
1,692
387
1,173
17
89
n.a.
3,034
33,953
965
276
688
64,275
31,149
21,331
1,004
1,109
65,593
15,409
12,963
2,194
n.a.
18,470
615
577
507
20,327
235,231
117,949
210,792
102,902
18,421
94,736
780,800
10,769
173,043
121,242
310
89,226
3,168
119,542
818,408
71
40,101
37,090
121,670
28,262
1,003
44,485
273,957
895,924
695,298
186,387
14,407
10,564
n.a.
95,422
120,690
45,404
235,894
116,499
108,498
240,893
173,504
118,159
90,190
320,473
39,688
36,025
28,144
123,957
2,843
8,504
n a.
n a.
n a.
Quarterly averages
Total loans
Obligations (other than securities) of states and political subdivisions
in the United States
Transaction accounts in domestic offices (NOW accounts, automated transfer service
(ATS) accounts, and telephone and preauthorized transfer accounts)
Nontransaction accounts in domestic offices
Money market deposit accounts
Other savings deposits
Time certificates of deposit of $100,000 or more
All other time deposits
152 Number of banks
Footnotes appear at the end of table 4.22
1,985
41
n.a.
MEMO
138
139
140
141
142
143
144
!
11,562
215
n.a.
n.a.
A72
4.21
Special Tables • February 1993
DOMESTIC OFFICES, Insured Commercial Banks with Assets of $100 Million or more or with foreign offices 1
Consolidated Report of Condition, September 30, 1992
Millions of dollars except as noted
Members
Nonmembers
Item
1 Total assets 4
2 Cash and balances due from depository institutions
3
Cash items in process of collection and unposted debits
4
Currency and coin
5
Balances due from depository institutions in the United States
6
Balances due from banks in foreign countries and foreign central banks
7
Balances due from Federal Reserve Banks
8 Total securities, loans, and lease financing receivables, (net of unearned income)
9 Total securities, book value
10
U.S. Treasury securities
11
U.S. government agency and corporation obligations
12
All holdings of U.S. government-issued or guaranteed certificates of
participation in pools of residential mortgages
13
All other
Securities issued by states and political subdivisions in the United States
14
15
Other domestic debt securities
16
All holdings of private certificates of participation in pools of residential mortgages . . .
17
Allother
18
Foreign debt securities
19 Equity securities
20
Marketable
21
Investments in mutual funds
22
Other
23
LESS: Net unrealized loss
24
Other equity securities
25 Federal funds sold and securities purchased under agreements to resell 8
26
Federal funds sold
27
Securities purchased under agreements to resell
28 Total loans and lease financing receivables, gross
29
LESS: Unearned income on loans
30 Total loans and leases (net of unearned income)
31
32
33
34
35
36
37
38
39
40
41
42
Total loans, gross, by category
Loans secured by real estate
Construction and land development
Farmland
One- to four-family residential properties
Revolving, open-end and extended under lines of credit
All other loans
Multifamily (five or more) residential properties
Nonfarm nonresidential properties
Commercial banks in the United States
Other depository institutions in the United States
Banks in foreign countries
Finance agricultural production and other loans to farmers
43 Commercial and industrial loans
44
U.S. addressees (domicile)
45
Non-U.S. addressees (domicile)
46 Acceptances of other banks 9
47
U.S. banks
48
Foreign banks
49 Loans to individuals for household, family, and other personal expenditures
(includes purchased paper)
50
Credit cards and related plans
51
Other (includes single payment and installment)
52 Loans to foreign governments and official institutions
53 Obligations (other than securities) of states and political subdivisions in the United States
(includes nonrated industrial development obligations)
54
Taxable
55
Tax-exempt
56 Other loans
57
Loans for purchasing and carrying securities
58
All other loans
59
60
61
62
Lease financing receivables
Customers' liability on acceptances outstanding
Net due from own foreign offices, Edge and agreement subsidiaries, and IBFs
Remaining assets
Total
National
State
2,737,070
2,132,143
1,662,527
469,616
604,927
162,994
78,696
27,738
24,853
6,686
25,021
134,268
69,814
22,639
16,115
5,524
20,177
109,398
56,274
18,637
13,341
4,741
16,406
24,870
13,540
4,002
2,774
783
3,771
28,726
8,882
5,099
8,738
1,163
4,844
2,360,685
1,814,821
1,432,025
382,7%
545,864
601,563
193,176
291,977
454,882
142,177
227,925
343,612
110,276
172,607
111,270
31,901
55,318
146,681
50,998
64,052
133,319
158,658
54,995
49,917
3,105
46,812
1,716
9,783
4,747
3,337
1,443
33
5,036
107,870
120,055
39,458
37,589
2,586
35,003
1,144
6,589
2,246
1,630
629
13
4,343
84,699
87,908
28,450
25,916
2,241
23,674
1,070
5,294
1,843
1,374
480
11
3,451
23,170
32,147
11,008
11,673
345
11,328
74
1,295
403
256
149
2
893
25,449
38,603
15,537
12,328
519
11,809
572
3,193
2,501
1,707
814
20
692
134,369
49,839
4,720
1,631,365
6,612
1,624,754
107,615
31,262
3,719
1,256,933
4,609
1,252,324
81,345
27,273
3,049
1,010,422
3,354
1,007,068
26,270
3,989
670
246,511
1,254
245,256
26,754
18,577
1,001
374,433
2,003
372,430
734,190
80,930
9,349
395,582
70,120
325,462
24,817
223,513
18,692
1,059
3,532
16,228
548,898
61,692
5,638
300,760
53,653
247,107
17,241
163,567
13,808
898
3,241
10,824
450,850
51,362
4,797
247,183
44,034
203,148
13,782
133,726
10,402
817
1,455
9,711
98,048
10,330
842
53,577
9,619
43,959
3,459
29,841
3,406
82
1,786
1,113
185,292
19,238
3,710
94,822
16,467
78,355
7,576
59,946
4,885
160
290
5,404
406,262
403,265
2,9%
328,204
325,568
2,635
259,049
257,089
1,960
69,155
68,479
675
78,058
77,697
361
742
491
131
584
405
113
400
231
111
184
173
3
159
86
18
324,927
62,3%
112,571
978
239,741
43,380
69,723
946
197,798
40,238
56,781
808
41,943
3,142
12,942
138
85,186
19,016
42,848
32
24,767
1,781
22,986
69,434
17,525
51,908
20,183
1,485
18,698
64,200
16,172
48,027
14,864
1,228
13,636
43,642
9,054
34,588
5,319
257
5,062
20,557
7,118
13,439
4,583
2%
4,288
5,234
1,353
3,881
30,555
12,573
51,994
200,817
25,405
11,704
45,667
171,349
20,626
8,473
19,804
112,631
4,779
3,232
25,863
58,718
5,149
869
6,327
29,468
Commercial Banks
A73
4.20—Continued
Members
Item
Nonmembers
Total
Total
National
State
2,737,070
2,132,143
1,662,527
469,616
604,927
2,515,394
1,962,218
1,531,326
430,892
553,176
65 Total deposits
66
Individuals, partnerships, and corporations
67
U.S. government
68
States and political subdivisions in the United States
69
Commercial banks in the United States
70
Other depository institutions in the United States
71
Banks in foreign countries
72
Foreign governments and official institutions
73
Certified and official checks
2,010,251
1,867,354
5,823
76,669
28,400
7,580
7,068
1,263
16,095
1,543,738
1,431,672
5,106
56,050
25,334
4,990
6,618
1,179
12,790
1,237,575
1,150,181
4,398
45,610
19,821
3,765
4,008
791
9,002
306,163
281,491
709
10,440
5,513
1,225
2,609
388
3,788
466,513
435,682
717
20,620
3,066
2,590
450
84
3,305
74 Total transaction accounts
75
Individuals, partnerships, and corporations
76
U.S. government
77
States and political subdivisions in the United States
78
Commercial banks in the United States
79
Other depository institutions in the United States
80
Banks in foreign countries
81
Foreign governments and official institutions
82
Certified and official checks
628,071
543,581
3,759
28,512
24,625
3,846
6,686
967
16,095
498,736
427,049
3,110
22,452
22,867
3,170
6,373
924
12,790
397,866
343,185
2,582
18,251
18,058
2,347
3,841
600
9,002
100,870
83,864
528
4,200
4,810
824
2,532
323
3,788
129,335
116,532
649
6,060
1,757
675
313
44
3,305
83 Demand deposits (included in total transaction accounts)
84
Individuals, partnerships, and corporations
85
U.S. government
86
States and political subdivisions in the United States
87
Commercial banks in the United States
88 Other depository institutions in the United States
89
Banks in foreign countries
90
Foreign governments and official institutions
91
Certified and official checks
411,042
341,202
3,567
14,114
24,602
3,829
6,667
966
16,095
333,835
272,956
2,942
11,842
22,866
3,158
6,357
924
12,790
262,696
216,942
2,428
9,507
18,057
2,334
3,825
600
9,002
71,139
56,014
514
2,335
4,809
824
2,532
323
3,788
77,207
68,246
625
2,272
1,736
671
310
43
3,305
1,382,181
1,323,773
2,064
48,157
3,775
228
3,547
3,734
382
59
323
2%
1,045,003
1,004,623
1,996
33,598
2,466
86
2,380
1,819
244
58
186
256
839,710
806,996
1,816
27,358
1,763
76
1,687
1,418
167
56
112
191
205,293
197,627
181
6,239
703
11
692
401
77
2
75
65
337,178
319,150
68
14,560
1,308
141
1,167
1,915
137
1
137
40
104 Federal funds purchased and securities sold under agreements to repurchase 10
105
106 Securities sold under agreements to repurchase
107 Demand notes issued to the U.S. Treasury
108
109 Banks liability on acceptances executed and outstanding
no Notes and debentures subordinated to deposits
111 Net due to own foreign offices, Edge and agreement subsidiaries, and IBFs
112
245,351
37,474
27,174
33,656
88,151
12,759
1,686
31,502
123,539
206,756
28,754
16,567
30,761
63,253
11,890
1,177
23,743
104,643
147,264
24,503
13,693
20,339
44,139
8,621
1,107
21,209
72,281
59,492
4,251
2,874
10,422
19,114
3,270
70
2,534
32,362
38,596
8,720
10,606
2,895
24,898
869
509
7,759
18,8%
113 Total equity capital7
221,675
169,925
131,200
38,724
51,751
1,797
129,868
46,558
34,294
3,198
550
100,059
33,820
24,611
1,701
550
80,867
28,030
20,753
1,528
0
19,192
5,790
3,858
173
1,247
29,809
12,738
9,683
1,498
63 Total liabilities and equity capital
3
64 Total liabilities
92 Total nontransaction accounts
Individuals, partnerships, and corporations
93
94
U.S. government
95
States and political subdivisions in the United States
96
Commercial banks in the United States
97
U.S. branches and agencies of foreign banks
98
Other commercial banks in the United States
99 Other depository institutions in the United States
100
Banks in foreign countries
101
Foreign branches of other U.S. banks
102
Other banks in foreign countries
103 Foreign governments and official institutions
MEMO
114 Holdings of commercial paper included in total loans, gross
115 Total individual retirement (IRA) and Keogh plan accounts
116 Total brokered deposits
117 Total brokered retail deposits
118
Issued in denominations of $100,000 or less
119 Issued in denominations greater than $100,000 and participated out by the broker in shares
of $100,000 or less
120 Money
121
12?
173
124
125
126
market deposit accounts (savings deposits; MMDAs)
Other savings accounts
Total time deposits of less than $100,000
Time certificates of deposit of $100,000 or more
Open-account time deposits of $100,000 or more
All negotiable order of withdrawal (NOW) accounts (including Super NOWs)
Total time and savings deposits
Quarterly averages
177
128 Obligations (other than securities) of states and political subdivisions in the United States
179 Transaction accounts (NOW accounts, automated transfer service (ATS) accounts, and
telephone preauthorized transfer accounts)
Nontransaction accounts
130
131
137
133
Time certificates of deposits of $100,000 or more
134
Footnotes appear at the end of table 4.22
31,095
22,910
19,225
3,685
8,186
408,274
239,191
520,999
192,128
21,589
214,278
1,599,209
323,581
181,711
384,870
137,588
17,252
163,248
1,209,903
259,670
135,169
317,134
116,514
11,223
133,824
974,880
63,911
46,543
67,736
21,074
6,029
29,424
235,024
84,693
57,480
136,129
54,539
4,337
51,030
389,306
1,591,222
24,971
1,227,058
20,429
989,555
14,947
237,503
5,482
364,164
4,542
216,112
164,527
134,593
29,934
51,584
409,398
234,658
198,688
561,366
325,352
178,874
142,899
418,407
260,101
132,902
121,309
339,609
65,251
45,972
21,590
78,798
84,045
55,785
55,790
142,959
3,058
1,652
1,371
281
1,406
A74
4.22
Special Tables • February 1993
DOMESTIC OFFICES, Insured Commercial Bank Assets and Liabilities 1
Consolidated Report of Condition, September 30, 1992
Millions of dollars except as noted
Members
Nonmembers
Item
Total
National
State
3,094,792
2,270,023
1,769,235
500,788
824,769
182,988
31,142
27,119
124,728
142,164
23,958
15,206
103,001
115,556
19,672
12,133
83,751
26,608
4,285
3,073
19,250
40,824
7,184
11,913
21,727
2,687,052
1,940,443
1,529,141
411,303
746,608
721,934
581,602
70,997
58,041
3,255
54,786
11,294
5,843
4,305
1,597
59
5,451
151,356
66,651
4,894
1,821,807
8,045
1,813,762
502,184
408,699
45,126
41,087
2,639
38,448
7,272
2,655
2,022
655
22
4,617
114,877
38,465
3,779
1,328,551
5,169
1,323,383
381,376
313,880
32,814
28,831
2,279
26,552
5,852
2,199
1,714
504
19
3,653
86,850
32,738
3,088
1,064,699
3,784
1,060,914
120,807
94,819
12,312
12,256
360
11,896
1,420
455
307
151
3
964
28,027
5,726
690
263,853
1,385
262,468
219,751
172,903
25,871
16,954
616
16,338
4,022
3,188
2,283
942
37
834
36,478
28,187
1,116
493,256
2,876
490,380
837,201
87,181
19,901
452,341
73,271
379,070
26,973
250,804
587,315
64,187
8,929
322,176
55,005
267,172
18,049
173,973
479,760
53,204
7,413
263,114
44,971
218,143
14,388
141,641
107,555
10,983
1,516
59,062
10,034
49,029
3,661
32,332
249,886
22,994
10,972
130,164
18,266
111,898
8,924
76,832
23,433
36,245
438,160
888
17,998
17,474
341,111
633
12,715
14,993
268,605
438
5,282
2,481
72,506
195
5,435
18,772
97,049
255
357,101
64,231
142,911
26,085
1,829
24,256
71,685
31,009
12,590
51,994
212,162
252,175
44,166
81,373
20,638
1,503
19,135
65,638
25,570
11,716
45,667
175,699
207,401
40,902
65,721
15,229
1,243
13,986
44,790
20,768
8,481
19,804
116,057
44,774
3,264
15,652
5,410
261
5,149
20,848
4,802
3,235
25,863
59,642
104,926
20,065
61,538
5,447
325
5,121
6,047
5,440
874
6,327
36,463
48 Total liabilities and equity capital
3,094,792
2,270,023
1,769,235
500,788
824,769
49 Total liabilities3
2,839,162
2,087,247
1,628,107
459,140
751,915
1,665,531
1,544,117
5,303
63,128
26,111
5,436
13,627
7,808
1,331,933
1,237,402
4,551
51,286
20,150
4,097
9,644
4,802
333,598
306,715
752
11,841
5,961
1,339
3,983
3,006
660,524
614,171
1,019
33,342
3,558
3,418
4,453
564
1 Total assets4
2 Cash and balances due from depository institutions
3
Currency and coin
Non-interest-bearing balances due from commercial banks
4
5
Other
6 Total securities, loans, and lease financing receivables (net of unearned income)
7 Total securities, book value
8
U.S. Treasury securities and U.S. government agency and corporation obligations
9
Securities issued by states and political subdivisions in the United States
10 Other debt securities
11
All holdings of private certificates of participation in pools of residential mortgages
12
All other
13 Equity securities
15
Investments in mutual funds
16
Other
LESS: Net unrealized loss
17
18 Other equity securities
19 Federal funds sold and securities purchased under agreements to resell
20
Federal funds sold
21
Securities purchased under agreements to resell
22 Total loans and lease financing receivables, gross
23
LESS: Unearned income on loans
24 Total loans and leases (net of unearned income)
Total loans, gross, by category
25 Loans secured by real estate
26
Construction and land development
28
29
30
31
32
One- to four-family residential properties
Revolving, open-end loans, and extended under lines of credit
All other loans
Multifamily (five or more) residential properties
Nonfarm nonresidential properties
33
34
35
36
37
Loans to depository institutions
Loans to finance agricultural production and other loans to farmers
Commercial and industrial loans
Acceptances of other banks
Loans to individuals for household, family, and other personal expenditures
(includes purchased paper)
38
Credit cards and related plans
39 Other (includes single payment installment)
40 Obligations (other than securities) of states and political subdivisions in the United States
43
44
45
46
47
All other loans
Lease financing receivables
Customers' liability on acceptances outstanding
Net due from own foreign offices, Edge and agreement subsidiaries, and IBFs
Remaining assets
51
Individuals, partnerships, and corporations
53
54
55
56
57
States and political subdivisions in the United States
Commercial banks in the United States
Other depository institutions in the United States
Certified and official checks
All other
2,326,055
2,158,288
6,322
96,469
29,669
8,854
18,080
8,372
58 Total transaction accounts
59
Individuals, partnerships, and corporations
60
U.S. government
61
States and political subdivisions in the United States
62
Commercial banks in the United States
63
Other depository institutions in the United States
64
Certified and official checks
65
All other
715,748
621,094
4,159
35,501
25,233
4,009
18,080
7,671
533,889
458,118
3,268
24,905
23,414
3,250
13,627
7,308
425,410
367,708
2,705
20,283
18,213
2,412
9,644
4,444
108,479
90,410
562
4,622
5,201
838
3,983
2,864
181,859
162,976
892
10,596
1,819
760
4,453
363
66 Demand deposits (included in total transaction accounts)
67
Individuals, partnerships, and corporations
68
U.S. government
69
States and political subdivisions in the United States
70
Commercial banks in the United States
71
Other depository institutions in the United States
72
Certified and official checks
73
All other
452,889
378,112
3,955
15,897
25,207
3,988
18,080
7,650
351,292
288,146
3,094
12,487
23,412
3,235
13,627
7,291
276,073
228,806
2,546
10,039
18,212
2,398
9,644
4,427
75,219
59,340
548
2,448
5,200
837
3,983
2,863
101,597
89,966
861
3,410
1,795
753
4,453
359
1,610,307
1,537,195
2,162
60,968
4,436
4,845
701
1,131,642
1,086,000
2,036
38,223
2,697
2,187
500
906,523
869,694
1,846
31,003
1,937
1,685
358
225,119
216,306
190
7,220
760
501
142
478,665
451,195
127
22,745
1,739
2,658
201
74 Total nontransaction accounts
75
Individuals, partnerships, and corporations
76
U.S. government
77
States and political subdivisions in the United States
78
Commercial banks in the United States
79
Other depository institutions in the United States
80
All other
Commercial Banks
A75
4.22—Continued
Members
Item
81
82
83
84
85
86
87
88
89
Nonmembers
Total
Federal funds purchased and securities sold under agreements to repurchase 10
Federal funds purchased
Securities sold under agreements to repurchase
Demand notes issued to the U.S. Treasury
Other borrowed money
Banks liability on acceptances executed and outstanding
Notes and debentures subordinated to deposits
Net due to own foreign offices, Edge and agreement subsidiaries, and IBFs
Remaining liabilities
90 Total equity capital7
Total
National
State
248,615
39,046
28,865
34,043
89,324
12,776
1,775
31,502
126,573
208,290
29,585
17,271
30,899
63,657
11,902
1,1%
23,743
105,772
148,332
25,032
14,233
20,450
44,477
8,629
1,118
21,209
73,168
59,958
4,553
3,038
10,449
19,179
3,273
78
2,534
32,604
40,324
9,460
11,594
3,144
25,668
874
579
7,759
20,802
255,630
182,776
141,128
41,648
72,854
39,992
20,865
3,442
1,246
2,566
781
159
3,089
6,902
38,067
20,543
2,936
1,148
2,524
731
159
2,933
6,638
23,514
11,899
2,592
701
1,947
683
159
2,030
3,090
14,552
8,643
344
447
578
48
0
903
3,548
1,925
322
506
98
42
50
0
156
264
148,338
47,173
34,871
3,705
106,875
34,058
24,829
1,890
86,175
28,206
20,911
1,670
20,699
5,852
3,918
220
41,464
13,115
10,042
1,815
31,166
22,939
19,241
3,698
8,227
448,375
276,281
642,669
220,390
22,592
258,763
1,873,166
340,114
1%,422
428,940
148,595
17,571
180,475
1,314,239
272,468
146,274
351,249
125,056
11,476
147,646
1,055,860
67,646
50,148
77,690
23,540
6,094
32,829
258,378
108,261
79,859
213,729
71,795
5,021
78,287
558,927
1,777,609
1,297,132
1,042,689
254,443
480,478
261,516
182,098
148,672
33,426
79,418
449,085
270,683
226,832
685,323
341,724
193,137
153,870
463,255
272,809
143,732
129,836
374,351
68,915
49,405
24,034
88,904
107,362
77,546
72,%2
222,068
11,562
4,615
3,649
966
6,947
MEMO
91 Assets held in trading accounts"
92
U.S. Treasury securities
93
U.S. government agency corporation obligations
94
Securities issued by states and political subdivisions in the United States
95 Other bonds, notes, and debentures
96
Certificates of deposit
97
Commercial paper
98
Bankers acceptances
99
Other
100 Total individual retirement (IRA) and Keogh plan accounts
101 Total brokered deposits
102 Total brokered retail deposits
103 Issued in denominations of $100,000 or less
104
Issued in denominations greater than $100,000 and participated out by the broker
in shares of $100,000 or less
105
106
107
108
109
110
Ill
Savings deposits
Money market deposit accounts (savings deposits; MMDAs)
Other savings deposits
Total time deposits of less than $100,000
Time certificates of deposit of $100,000 or more
Open-account time deposits of $100,000 or more
All negotiable order of withdrawal (NOW) accounts (including Super NOWs)
Total time and savings deposits
Quarterly averages
112 Total loans
113 Transaction accounts (NOW accounts, automated transfer service (ATS) accounts, and
telephone and preauthorized transfer accounts)
Nontransaction accounts
114 Money market deposit accounts
115 Other savings deposits
116 Time certificates of deposit of $100,000 or more
117 All other time deposits
118 Number of banks
1. Effective Mar. 31, 1984, the report of condition was substantially revised for
commercial banks. Some of the changes are as follows: (1) Previously, banks with
international banking facilities (IBFs) that had no other foreign offices were
considered domestic reporters. Beginning with the March 31, 1984, Call Report
these banks are considered foreign and domestic reporters and must file the
foreign and domestic report of condition; (2) banks with assets of more than $1
billion report additional items; (3) the domestic offices of banks with foreign
offices report far less detail; and (4) banks with assets of less than $25 million have
been excused from reporting certain detail items.
The " n . a . " for some of the items is used to indicate the lesser detail available
from banks without foreign offices, the inapplicability of certain items to banks
that have only domestic offices or the absence of detail on a fully consolidated
basis for banks with foreign offices.
All transactions between domestic and foreign offices of a bank are reported in
"net due from" and "net due t o . " All other lines represent transactions with
parties other than the domestic and foreign offices of each bank. Because these
intraoffice transactions are nullified by consolidation, total assets and total
liabilities for the entire bank may not equal the sum of assets and liabilities
respectively of the domestic and foreign offices.
2. Foreign offices include branches in foreign countries, Puerto Rico, and U.S.
territories and possessions; subsidiaries in foreign countries; all offices of Edge
Act and Agreement corporations wherever located and IBFs.
3. The "over 100" refers to banks whose assets, on June 30 of the preceding
calendar year, were $100 million or more. (These banks file the FFIEC 032 or
FFIEC 033 Call Report.) "Under 100" refers to banks whose assets, on June 30
of the preceding calendar year, were less than $100 million. (These banks filed the
FFIEC 034 Call Report.)
4. Because the domestic portion of allowances for loan and lease losses and
allocated transfer risk reserve are not reported for banks with foreign offices, the
components of total assets (domestic) do not sum to the actual total (domestic).
5. Because the foreign portion of demand notes issued to the U.S. Treasury is
not reported for banks with foreign offices, the components of total liabilities
(foreign) will not sum to the actual total (foreign).
6. The definition of "all other" varies by report form and therefore by column
in this table.
7. Equity capital is not allocated between the domestic and foreign offices of
banks with foreign offices.
8. Only the domestic portion of federal funds sold and securities purchased
under agreements to resell are reported here; therefore, the components do not
sum to totals.
9. "Acceptances of other banks" is not reported by domestic banks having less
than $300 million in total assets; therefore the components do not sum to totals.
10. Only the domestic portion of federal funds purchased and securities sold
are reported here; therefore the components do not sum to totals.
11. Components are reported only for banks with total assets of $1 billion or
more; therefore the components do not sum to totals.
A76
4.23
Special Tables • February 1993
TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, November 2-6, 19921
A. Commercial and Industrial Loans
Characteristic
Amount of
loans
($1,000)
Average
size
($1,000)
Weighted
average
maturity 2
Days
Loan rate (percent)
Weighted
average
effective 3
Standard
Loans
secured
by
collateral
(percent)
Loans
made
under
commitment
(percent)
Participation
loans
(percent)
ALL BANKS
1 Overnight 6
11,489,659
7,587
2 One month and under (excluding
overnight)
Fixed rate
3
4
Floating rate
7,142,624
5,542,985
1,599,639
886
1,263
435
19
18
23
4.45
4.29
5.01
37.1
33.2
50.3
83.4
84.9
78.2
14.4
11.4
24.9
5 Over one month and under a year .
6
Fixed rate
7
Floating rate
9,564,119
2,918,977
6,645,142
177
142
197
152
127
163
5.53
5.02
5.76
46.0
43.3
47.2
84.6
71.7
90.3
12.2
9.6
13.3
8 Demand 7
Fixed rate
9
10 Floating rate
14,038,692
2,321,049
11,717,643
292
576
266
5.84
4.39
6.13
66.9
37.1
72.8
66.2
70.6
65.3
9.4
17.5
7.8
3.85
.22
5.5
11 Total short term
42,235,094
378
4.99
40.6
69.5
9.8
12 Fixed rate (thousands of dollars) ..
13
1-99
14
100-499
15 500-999
16
1,000-4,999
17 5,000-9,999
18
10,000 and over
22,271,296
387,457
326,703
414,140
3,836,634
3,989,303
13,317,060
732
15
200
673
2,304
6,695
21,214
24
150
94
113
48
20
13
4.17
8.64
6.27
4.67
4.58
4.12
3.87
21.0
79.3
59.3
37.5
30.1
15.8
16.7
65.0
34.2
54.1
64.7
73.2
65.7
63.5
.4
8.4
8.8
10.3
12.6
7.5
19 Floating rate (thousands of dollars)
20
1-99
21
100-499
22
500-999
23
1,000-4,999
24 5,000-9,999
25
10,000 and over
19,963,798
1,587,803
3,179,932
1,516,843
4,271,573
1,815,392
7,592,255
245
26
206
655
1,950
6,783
29,0%
136
163
182
157
157
131
99
5.91
7.53
7.06
6.71
6.37
5.44
4.79
62.5
83.7
79.3
72.9
57.8
45.7
55.6
74.7
85.8
85.6
93.3
82.3
73.8
59.9
11.0
2.4
8.2
14.8
13.0
11.0
12.1
Months
26 Total long term
4,575,958
178
6.36
62.6
74.4
27 Fixed rate (thousands of dollars) . .
28
1-99
29
100-499
30 500-999
31
1,000 and over
1,364,100
187,779
183,425
52,758
940,138
108
16
201
635
6,244
5.97
9.28
7.94
6.82
4.88
57.2
91.3
93.1
82.7
41.9
72.3
21.9
29.7
55.8
91.6
5.1
32 Floating rate (thousands of dollars)
33
1-99
34
100-499
35
500-999
36
1,000 and over
3,211,858
241,635
585,898
318,572
2,065,753
244
26
220
658
3,731
6.53
7.95
7.22
6.83
64.9
80.7
78.0
73.3
58.1
75.3
48.0
70.9
79.0
79.1
17.4
1.4
6.5
16.4
22.5
6.12
.2
4.5
3.0
6.4
Loan rate (percent)
Days
Effective3
Nominal8
LOANS MADE BELOW PRIME 10
37 Overnight 6
38 One month and under (excluding
overnight)
39 Over one month and under a year
40 Demand 7
10,892,314
8,813
3.72
3.71
6.4
49.9
5.8
6,358,035
5,166,014
5,355,249
3,548
603
2,528
18
143
4.09
4.37
3.85
4.07
4.33
3.81
33.9
35.5
58.7
84.2
87.5
43.2
14.4
15.4
13.3
63.8
62.5
9.2
15.8
93.8
8.7
93.4
94.3
4.6
13.0
41 Total short term
27,771,612
2,025
39
3.95
3.93
28.2
42
43
Fixed rate
Floating rate
20,283,305
7,488,307
2,510
1,330
22
118
3.89
4.12
3.87
4.08
54.2
44 Total long term
1,639,193
4.56
4.54
4.47
4.66
4.46
4.62
45
46
Fixed rate . . .
Floating rate .
For notes see end of table.
843,036
796,157
562
682
18.6
36.5
36.2
Financial Markets
4.23—Continued
Characteristic
Amount of
loans
($1,000)
Average
size
($1,000)
Weighted
average
maturity 2
Days
Loans
secured
by
collateral
(percent)
Loans
made
under
commitment
(percent)
i.02
8.5
52.5
Loan rate (percent)
Weighted
average
effective 3
Standard
Participation
loans
(percent)
LARGE BANKS
1 Overnight
6
7,827,426
8,359
2 One month and under (excluding
overnight)
3
Fixed rate
4
Floating rate
5,435,273
4,402,529
1,032,744
3,694
5,438
1,561
18
17
20
4.24
4.18
4.53
37.7
33.8
54.0
90.4
89.4
94.4
9.4
8.6
12.9
5 Over one month and under a year .
6
Fixed rate
7
Floating rate
5,201,561
1,668,877
3,532,684
1,019
1,845
841
131
103
144
5.07
4.66
5.26
34.0
40.6
30.9
90.6
12.0
10.8
95.5
12.6
9,849,059
1,885,100
7,963,959
607
1,910
523
5.42
4.24
5.70
64.6
39.5
70.5
60.1
65.2
58.9
9.6
18.5
7.5
8 Demand 7
9
Fixed rate
10
Floating rate
80.1
11 Total short term
28,313,318
1,193
43
4.74
38.3
69.4
9.5
12 Fixed rate (thousands of dollars) . .
13
1-99
14
100-499
15
500-999
16
1,000-4,999
17
5,000-9,999
18
10,000 and over
15,782,557
18,635
119,890
235,365
2,676,567
2,9%,221
9,735,880
4,342
26
242
705
2,282
6,539
21,294
18
125
62
53
41
18
12
4.16
6.92
5.35
4.97
4.60
4.16
3.99
22.6
63.6
53.9
51.1
33.7
18.5
19.7
67.2
52.4
71.9
76.6
74.0
63.3
66.3
9.6
7.2
10.1
12.3
10.2
13.0
8.4
19 Floating rate (thousands of dollars)
20
1-99
21
100-499
22
500-999
23
1,000-4,999
24
5,000-9,999
25
10,000 and over
12,530,761
386,244
1,175,624
723,652
2,155,153
1,412,821
6,677,268
624
32
213
663
2,076
6,824
28,689
116
161
161
167
143
133
95
5.48
7.22
6.90
6.69
6.12
5.69
4.75
58.0
82.2
73.3
67.8
56.6
55.9
53.7
72.2
90.3
91.7
92.1
82.0
73.3
62.1
9.4
2.0
5.1
8.9
11.8
10.7
9.6
Months
26 Total long term
2,522,013
856
59.6
80.3
20.5
27 Fixed rate (thousands of dollars) . .
28
1-99
29
100-499
30
500-999
31
1,000 and over
550,868
7,153
30,815
21,723
491,177
1,065
25
256
701
5,857
5.64
8.47
7.08
5.88
5.50
64.9
86.3
79.1
65.5
63.7
82.5
23.8
56.6
71.6
85.5
11.1
.0
6.6
7.1
11.7
32 Floating rate (thousands of dollars)
33
1-99
34
100-499
35
500-999
36
1,000 and over
1,971,144
32,889
208,706
195,531
1,534,018
811
37
233
679
4,277
6.21
58.1
76.8
71.5
65.2
54.9
79.7
75.1
79.1
78.6
80.0
23.2
5.9
6.0
12.9
27.2
36.0
29.9
63.6
90.5
89.8
35.1
8.5
17.7
12.3
7.21
6.95
6.73
6.02
Loan rate (percent)
Days
Effective 3
Nominal 8
LOANS MADE BELOW PRIME
37 Overnight 6
38 One month and under (excluding
overnight)
39 Over one month and under a year
40 Demand 7
7,231,550
8,158
5,102,905
3,129,538
4,679,703
6,200
4,165
4,716
41 Total short term
20,143,696
5,833
42
43
14,423,269
5,720,427
5,691
6,226
Fixed rate
Floating rate
17
125
18
103
3.84
3.82
4.09
4.16
3.78
4.08
4.13
3.74
3.94
3.92
3.94
3.92
3.93
3.89
21.3
58.3
64.4
57.5
10.0
12.9
4.31
34.8
95.8
14.3
4.60
4.10
56.1
19.2
94.3
96.9
9.8
17.6
Months
44 Total long term
878,046
2,987
45
46
371,220
506,826
2,755
3,183
Fixed rate . .
Floating rate
For notes see end of table.
4.61
4.15
All
A78
4.23
Special Tables • February 1993
TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, November 2-6, 1992'—Continued
Commercial and industrial loans—Continued
Characteristic
Amount of
loans
($1,000)
Average
size
($1,000)
Weighted
average
maturity 2
Days
Loan rate (percent)
Weighted
average
effective 3
Standard
Loans
secured
by
collateral
(percent)
Loans
made
under
commitment
(percent)
Participation
loans
(percent)
OTHER BANKS
1 Overnight 6
3,662,233
6,337
2 One month and under (excluding
overnight)
3
Fixed rate
4
Floating rate
1,707,351
1,140,456
566,895
259
319
188
24
22
28
5.12
4.73
5.89
35.1
30.9
43.5
61.3
67.6
48.6
30.5
22.5
46.7
5 Over one month and under a year .
6
Fixed rate
7
Floating rate
4.362.558
1,250,101
3,112,458
89
64
106
177
160
184
6.09
5.50
6.32
60.4
46.9
65.8
77.5
60.4
84.4
12.4
4,189,633
435,949
3,753,684
132
143
131
6.82
5.03
7.03
72.4
26.8
77.7
80.4
93.7
78.8
9.0
13.4
8.5
7
8 Demand
9
Fixed rate
10
Floating rate
11 Total short term
3.51
.26
8.1
14.1
13,921,776
158
84
5.51
45.3
69.8
10.5
12 Fixed rate (thousands of dollars) . .
13
1-99
14
100-499
15
500-999
16
1,000-4,999
17
5,000-9,999
18
10,000 and over
6,488,739
368,821
206,813
178,775
1,160,067
993,082
3,581,180
242
15
182
635
2,359
7,216
20,998
38
151
106
171
61
28
13
4.21
8.73
16.9
6.7
7.4
4.1
10.5
7.5
8.6
59.4
33.3
43.8
49.1
71.4
73.1
55.9
19 Floating rate (thousands of dollars)
20
1-99
21
100-499
22
500-999
23
1,000-4,999
24
5,000-9,999
25
10,000 and over
7,433,037
1.201.559
2,004,308
793,191
2,116,421
402,571
914,987
121
160
163
188
152
172
126
114
6.65
7.62
7.15
6.74
6.63
4.58
5.12
70.1
84.2
82.8
77.5
59.1
10.0
69.2
78.8
84.3
82.0
94.5
82.6
75.4
44.2
13.8
2.5
10.0
20.2
14.3
12.1
30.8
25
202
648
1,836
6,644
32,454
80.1
6.81
62.4
19.7
4.27
4.52
3.99
3.55
21.8
.0
11.1
5.0
Months
26 Total long term
2,053,945
90
6.71
66.4
67.1
5.4
27 Fixed rate (thousands of dollars) . .
28
1-99
29
100-499
30
500-999
31
1,000 and over
813,232
180,626
152,611
31,035
448,960
67
16
193
595
6,730
6.19
9.31
8.11
7.48
4.20
52.0
91.5
96.0
94.8
18.1
65.3
21.9
24.3
44.8
98.2
.2
4.1
.0
.6
32 Floating rate (thousands of dollars)
33
1-99
34
100-499
35
50b-999
36
1,000 and over
1,240,714
208,746
377,192
123,041
531,735
116
24
213
628
2,727
7.04
8.06
7.37
6.98
6.42
75.8
81.3
81.5
86.0
67.3
68.3
43.7
66.4
79.5
76.8
1.1
8.2
.6
6.7
21.8
9.1
Loan rate (percent)
Days
Effective 3
Nominal 8
LOANS MADE BELOW PRIME
37 Overnight 6
38 One month and under (excluding
overnight)
39 Over one month and under a year
40 Demand 7
3,660,764
10,472
1,255,130
2,036,476
675,546
1,295
261
600
23
170
4.08
4.69
4.37
4.03
4.65
4.34
25.3
44.2
24.1
41 Total short term
7,627,916
744
55
3.99
3.96
18.6
42
43
5,860,036
1,767,880
1,056
375
31
145
3.76
4.75
3.73
4.69
11.8
4.82
4.37
5.56
Fixed rate
Floating rate
3.51
1.0
58.8
84.1
98.8
38.2
11.9
20.4
11.5
41.1
62.2
78.8
7.4
25.1
4.80
38.1
91.6
2.2
4.35
5.54
21.0
92.8
89.8
.5
4.9
Months
44 Total long term
761,147
321
45
46
471,816
289,331
346
287
Fixed rate . .
Floating rate
For notes see following page.
30
66.1
Financial Markets
A79
NOTES TO TABLE 4.23
1. As of Sept. 30, 1990, assets of most of the large banks were at least $7.0
billion. For all insured banks, total assets averaged $275 million.
2. Average maturities are weighted by loan size and exclude demand loans.
3. Effective (compounded) annual interest rates are calculated from the stated
rate and other terms of the loans and weighted by loan size.
4. The chances are about two out of three that the average rate shown would
differ by less than this amount from the average rate that would be found by a
complete survey of lending at all banks.
5. The most common base rate is that used to price the largest dollar volume of
loans. Base pricing rates include the prime rate (sometimes referred to as a bank's
"basic" or "reference" rate); the federal funds rate; domestic money market
rates other than the federal funds rate; foreign money market rates; and other base
rates not included in the foregoing classifications.
6. Overnight loans mature on the following business day.
7. Demand loans have no stated date of maturity.
8. Nominal (not compounded) annual interest rates are calculated from the
stated rate and other terms of the loans and weighted by loan size.
9. The prime rate reported by each bank is weighted by the volume of loans
extended and then averaged.
10. The proportion of loans made at rates below the prime may vary substantially from the proportion of such loans outstanding in banks' portfolios.
A80
4.30
Special Tables • February 1993
ASSETS A N D LIABILITIES of U.S. Branches and Agencies of Foreign Banks, September 30, 19921
Millions of dollars
All states
Item
1 Total assets4
Total
including
IBFs
New York
IBFs
only
Total
including
IBFs
California
Illinois
IBFs
only
Total
including
IBFs
IBFs
only
Total
including
IBFs
IBFs
only
697,952
292,061
525,316
232,626
79,302
33,687
56,747
17,569
2 Claims on nonrelated parties
3 Cash and balances due from depository institutions
4 Cash items in process of collection and unposted
debits
5 Currency and coin (U.S. and foreign)
6 Balances with depository institutions in United States ..
/
U.S. branches and agencies of other foreign banks
(including IBFs)
8
Other depository institutions in United States
(including IBFs)
9 Balances with banks in foreign countries and with
foreign central banks
10
Foreign branches of U.S. banks
II
Other banks in foreign countries and foreign central
banks
12 Balances with Federal Reserve Banks
605,746
139,621
186,894
109,734
446,673
119,549
155,197
91,408
73,853
6,850
13,836
6,206
56,536
11,963
13,799
11,438
2,310
23
80,269
0
n.a.
55,423
2,169
16
69,999
0
n.a.
46,285
15
2
4,124
0
n.a.
3,544
86
1
5,522
5,323
74,924
53,334
65,580
44,498
3,808
3,534
5,101
5,045
5,345
2,089
4,420
1,787
316
10
421
278
56,083
1,600
54,311
1,564
46,536
1,357
45,123
1,322
2,665
159
2,662
159
6,340
79
6,115
79
54,483
936
52,747
n.a.
45,179
829
43,801
n.a.
2,506
43
2,503
n.a.
6,261
15
6,036
n.a.
13 Total securities and loans
377,778
66,634
254,944
54,668
60,047
6,743
36,674
2,041
74,380
24,631
14,421
n.a.
68,769
24,495
13,535
n.a.
3,308
52
527
n.a.
1,908
36
327
n.a.
14 Total securities, book value
15 U.S. Treasury
16 Obligations of U.S. government agencies and
corporations
17 Other bonds, notes, debentures, and corporate stock
(including state and local securities)
18 Federal funds sold and securities purchased under
agreements to resell
19 U.S. branches and agencies of other foreign banks
20 Commercial banks in United States
21 Other
22 Total loans, gross
23 Less: Unearned income on loans
24 Equals: Loans, net
Total loans, gross, by category
25 Real estate loans
26 Loans to depository institutions
27 Commercial banks in United States (including IBFs)
28
U.S. branches and agencies of other foreign banks . . .
29
Other commercial banks in United States
30 Other depository institutions in United States (including
IBFs)
31 Banks in foreign countries
32
Foreign branches of U.S. banks
33
Other banks in foreign countries
34 Other financial institutions
35 Commercial and industrial loans
36 U.S. addressees (domicile)
3/
Non-U.S. addressees (domicile)
38 Acceptances of other banks
39
U.S. banks
40 Foreign banks
41 Loans to foreign governments and official institutions
(including foreign central banks)
42 Loans for purchasing or carrying securities (secured and
unsecured)
43 AH other loans
0
14,226
n.a.
13,737
n.a.
35,524
14,421
30,537
13,535
2,929
527
1,764
327
36,232
10,810
5,275
20,146
2,871
1,719
175
977
34,183
9,481
4,950
19,752
2,441
1,527
175
740
909
690
68
152
249
193
0
57
685
453
119
113
50
0
0
50
303,535
137
303,398
52,221
9
52,213
186,262
87
186,175
41,141
7
41,134
56,762
23
56,739
6,218
1
6,217
34,787
21
34,765
1,715
0
1,714
53,678
45,970
21,943
18,958
2,984
581
31,371
11,452
10,472
980
26,540
36,362
16,865
14,636
2,228
302
24,334
8,504
7,606
898
17,771
5,241
3,299
3,131
168
220
4,191
2,254
2,178
76
5,434
1,968
1,355
924
431
59
1,164
573
568
5
26
24,001
528
23,474
18,428
16
19,902
368
19,534
868
26
19,472
428
19,043
15,780
16
15,813
273
15,540
766
0
1,942
95
1,847
870
0
1,937
95
1,842
40
0
613
0
613
1,408
0
591
0
591
21
167,252
144,815
22,436
1,678
940
738
13,421
535
12,886
39
0
39
92,912
75,827
17,085
759
330
429
10,631
401
10,230
31
0
31
31,663
29,290
2,374
626
555
72
1,549
107
1,442
0
0
0
25,029
24,424
605
165
2
164
372
8
364
0
0
0
327
n.a.
109
n.a.
7,444
5,661
5,672
4,870
279
184
422
99
5,180
3,905
100
182
4,998
3,238
66
140
133
180
34
0
49
312
0
0
52,115
17,461
11,980
5,481
7,656
n.a.
n.a.
n.a.
37,998
11,940
7,304
4,636
6,680
n.a.
n.a.
n.a.
6,048
4,240
3,701
539
637
n.a.
n.a.
n.a.
7,214
969
867
103
270
n.a.
34,654
92,206
7,656
105,167
26,058
78,642
6,680
77,429
1,808
5,449
637
19,851
6,244
211
270
3,770
92,206
n.a.
78,642
n.a.
5,449
n.a.
n.a.
105,167
n.a.
77,429
n.a.
19,851
n.a.
3,770
52 Total liabilities4
697,952
292,061
525,316
232,626
79,302
33,687
56,747
17,569
53 Liabilities to nonrelated parties
585,091
254,552
470,752
204,664
65,195
32,889
30,951
9,912
44 All other assets
45 Customers' liability on acceptances outstanding
46
U.S. addressees (domicile)
4/
Non-U.S. addressees (domicile)
48 Other assets including other claims on nonrelated
parties
49 Net due from related depository institutions5
50 Net due from head office and other related depository
institutions
51 Net due from establishing entity, head offices, and other
related depository institutions
211
n.a.
U.S. Branches and Agencies
A81
4.30—Continued
Millions of dollars
All states
Item
54 Total deposits and credit balances
55
Individuals, partnerships, and corporations
56
U.S. addressees (domicile)
57
Non-U.S. addressees (domicile)
58 Commercial banks in United States (including I B F s ) . . .
59
U.S. branches and agencies of other foreign banks ..
60
Other commercial banks in United States
61
Banks in foreign countries
62
Foreign branches of U.S. banks
63
Other banks in foreign countries
64
Foreign governments and official institutions
(including foreign central banks)
65
All other deposits and credit balances
66 Certified and official checks
67 Transaction accounts and credit balances
(excluding IBFs)
Individuals, partnerships, and corporations
U.S. addressees (domicile)
Non-U.S. addressees (domicile)
Commercial banks in United States (including I B F s ) . . .
U.S. branches and agencies of other foreign banks . .
Other commercial banks in United States
Banks in foreign countries
Foreign branches of U.S. banks
Other banks in foreign countries
Foreign governments and official institutions
(including foreign central banks)
78
All other deposits and credit balances
79 Certified and official checks
68
69
70
71
72
73
74
75
76
77
80 Demand deposits (included in transaction accounts
and credit balances)
Individuals, partnerships, and corporations
81
82
U.S. addressees (domicile)
83
Non-U.S. addressees (domicile)
84 Commercial banks in United States (including I B F ) s . . .
85
U.S. branches and agencies of other foreign banks . .
86
Other commercial banks in United States
87
Banks in foreign countries
88
Foreign branches of U.S. banks
89
Other banks in foreign countries
90
Foreign governments and official institutions
(including foreign central banks)
91
All other deposits and credit balances
92
Certified and official checks
93 Non-transaction accounts (including MMDAs,
excluding IBFs)
94
Individuals, partnerships, and corporations
95
U.S. addressees (domicile)
%
Non-U.S. addressees (domicile)
97 Commercial banks in United States (including I B F s ) . . .
98
U.S. branches and agencies of other foreign banks . .
99
Other commercial banks in United States
100 Banks in foreign countries
101
Foreign branches of U.S. banks
102
Other banks in foreign countries
103 Foreign governments and official institutions
(including foreign central banks)
104 All other deposits and credit balances
105 IBF deposit liabilities
106 Individuals, partnerships, and corporations
107
U.S. addressees (domicile)
108
Non-U.S. addressees (domicile)
109 Commercial banks in United States (including I B F s ) . . .
110
U.S. branches and agencies of other foreign banks ..
111
Other commercial banks in United States
112
Banks in foreign countries
113
Foreign branches of U.S. banks
114
Other banks in foreign countries
115
Foreign governments and official institutions
(including foreign central banks)
116 All other deposits and credit balances
For notes see end of table.
Total
excluding
IBFs
IBFs
only
New York
Illinois
California
Total
excluding
IBFs
IBFs
only
Total
excluding
IBFs
IBFs
only
Total
excluding
IBFs
IBFs
only
150,449
107,574
92,020
15,554
30,292
12,976
17,316
5,741
1,990
3,751
186,148
16,421
3,059
13,362
53,587
48,381
5,206
98,688
4,889
93,799
129,000
89,146
79,672
9,474
28,589
12,411
16,178
5,557
1,964
3,593
167,764
10,896
3,009
7,887
48,295
43,553
4,742
92,544
4,418
88,126
4,772
4,140
2,320
1,820
363
104
259
4
0
4
7,974
512
0
512
3,072
2,794
278
3,372
362
3,010
8,094
7,321
6,266
1,054
732
315
417
26
25
1
4,012
111
50
61
1,733
1,608
125
2,085
85
2,000
1,896
4,648
297
17,279
173
1,510
3,955
242
15,856
173
234
10
21
1,019
0
3
2
10
B3
0
8,038
5,792
4,295
1,497
462
66
396
1,069
2
1,067
6,280
4,592
3,656
936
177
16
160
947
1
945
539
218
182
35
282
48
234
4
0
4
344
329
323
6
0
0
0
1
0
1
319
98
297
243
80
242
4
10
21
2
1
10
6,960
5,408
4,144
1,265
110
17
92
841
2
839
5,768
4,461
3,589
872
106
16
90
724
1
723
208
178
155
22
1
0
0
4
0
4
332
317
312
5
0
0
0
1
0
1
n.a.
n.a.
n.a.
242
62
297
180
55
242
4
1
21
2
1
10
142,411
101,782
87,724
14,057
29,830
12,910
16,920
4,672
1,988
2,684
122,720
84,554
76,017
8,537
28,413
12,395
16,018
4,611
1,963
2,648
4,233
3,923
2,137
1,785
81
56
25
0
0
0
7,750
6,992
5,943
1,049
732
315
417
25
25
0
1,577
4,550
1,267
3,876
229
0
1
1
n.a.
186,148
16,421
3,059
13,362
53,587
48,381
5,206
98,688
4,889
93,799
17,279
173
n.a.
167,764
10,896
3,009
7,887
48,295
43,553
4,742
92,544
4,418
88,126
15,856
173
n.a.
7,974
512
0
512
3,072
2,794
278
3,372
362
3,010
1,019
0
n.a.
n.a.
4,012
111
50
61
1,733
1,608
125
2,085
85
2,000
83
0
A82
4.30
Special Tables • February 1993
ASSETS A N D LIABILITIES of U.S. Branches and Agencies of Foreign Banks, September 30, 1992'—Continued
Millions of dollars
All states
Item
117 Federal funds purchased and securities sold under
agreements to repurchase
118 U.S. branches and agencies of other foreign banks
119 Other commercial banks in United States
120 Other
121 Other borrowed money
122 Owed to nonrelated commercial banks in United States
(including IBFs)
123 Owed to U.S. offices of nonrelated U.S. banks
124
Owed to U.S. branches and agencies of
nonrelated foreign banks
125 Owed to nonrelated banks in foreign countries
126 Owed to foreign branches of nonrelated U.S. banks . . .
127
Owed to foreign offices of nonrelated foreign banks
128 Owed to others
129 All other liabilities
130
Branch or agency liability on acceptances executed
and outstanding
141 Other liabilities to nonrelated parties
132 Net due to related depository institutions 5
143 Net due to head office and other related depository
institutions
134 Net due to establishing entity, head office, and other
related depository institutions
Total
including
IBFs
New York
IBFs
only
Total
including
IBFs
California
Illinois
IBFs
only
Total
including
IBFs
IBFs
only
Total
including
IBFs
IBFs
only
79,205
14,247
17,150
47,809
118,585
13,219
2,146
310
10,764
49,200
66,376
10,316
12,766
43,294
70,378
10,175
1,003
90
9,082
21,457
8,848
2,974
3,061
2,812
37,541
1,543
855
155
533
22.848
3,638
864
1,200
1,575
8,662
1,459
288
65
1,106
4,292
41,024
13,649
18,465
2,063
17,921
8,200
4,170
703
18,121
3,554
12,380
1.215
3,539
1,378
1,594
85
27,375
29,809
1,987
27,822
47,753
16,403
27,952
1,845
26,107
2,783
9,721
16,447
788
15,658
36,010
3,467
14,775
666
14,109
2,512
14,567
10,484
1,035
9,448
8,936
11.165
10,368
1,035
9,333
100
2,161
2,533
129
2,404
2,589
1,509
2,533
129
2,404
164
50,703
5,985
37,234
5,268
6,060
524
6,544
149
19,490
31,214
n.a.
5,985
13,926
23,308
n.a.
5,268
4,248
1,812
n.a.
524
720
5,824
n.a.
149
25,796
7.657
112,861
37,509
54,564
27,962
14,107
112,861
n.a.
54,564
n.a.
14,107
n.a.
37,509
n.a.
27,962
n.a.
798
n.a.
798
25,7%
n.a.
n.a.
7,657
MEMO
135 Non-interest bearing balances with commercial banks
in United States
136 Holding of commercial paper included in total loans
137 Holding of own acceptances included in commercial
and industrial loans
138 Commercial and industrial loans with remaining maturity
of one year or less
149 Predetermined interest rates
140 Floating interest rates
141 Commercial and industrial loans with remaining maturity
of more than one year
142 Predetermined interest rates
143 Floating interest rates
1,358
1,532
0
1,068
1,345
0
127
136
0
82
27
3,692
2,713
607
101
99,165
61,221
37,944
52,422
30,188
22,234
19,703
12,585
7,118
15,465
11,608
3,857
68,086
23,023
45,064
n.a.
40,490
13,054
27,435
n.a.
11,960
3,614
8,347
n.a.
9,564
4,475
5,089
0
n.a.
U.S. Branches and Agencies
A83
4.30—Continued
Millions of dollars
New York
All states
Item
144 Components of total nontransaction accounts,
included in total deposits and credit balances of
nontransactional accounts, including IBFs
145 Time CDs in denominations of $100,000 or more
146 Other time deposits in denominations of $100,000
or more
147 Time CDs in denominations of $100,000 or more
with remaining maturity of more than 12 months . .
Total
excluding
IBFs
IBFs
only
t
148,897
111,809
24,413
All states
Total
including
IBFs
148 Market value of securities held
149 Immediately available funds with a maturity greater than
one day included in other borrowed money
150 Number of reports filed6
74,900
77,120
573
IBFs
only
Total
excluding
IBFs
IBFs
only
Total
excluding
IBFs
129,928
97,293
t
4,779
2,715
t
7,919
6,069
t
n.a.
1,431
n.a.
n.a.
*
1,014
2
New York
14,344
n.a.
0
Total
including
IBFs
1
1,050
11,018
IBFs
only
1. Data are aggregates of categories reported on the quarterly form FFIEC 002,
"Report of Assets and Liabilities of U.S. Branches and Agencies of Foreign
Banks." Details may not add to totals because of rounding. This form was first
used for reporting data as of June 30, 1980, and was revised as of December 31,
1985. From November 1972 through May 1980, U.S. branches and agencies of
foreign banks had filed a monthly FR 886a report. Aggregate data from that report
were available through the Federal Reserve statistical release G . l l , last issued on
July 10, 1980. Data in this table and in the G.l 1 tables are not strictly comparable
because of differences in reporting panels and in definitions of balance sheet
items.
2. Includes the District of Columbia.
3. Effective December 1981, the Federal Reserve Board amended Regulations
D and Q to permit banking offices located in the United States to operate
International Banking Facilities (IBFs). As of December 31, 1985 data for IBFs
are reported in a separate column. These data are either included in or excluded
from the total columns as indicated in the headings. The notation "n.a." indicates
Total
excluding
IBFs
21,617
n.a.
*
12,675
Illinois
California
IBFs
only
1
419
Illinois
California
Total
including
IBFs
IBFs
only
Total
including
IBFs
IBFs
only
69,287
13,440
3,471
547
1,744
324
43,070
268
n.a.
n.a.
0
5,197
51
n.a.
0
0
27,468
133
IBFs
only
that no IBF data re reported for that item, either because the item is not an eligible
IBF asset or liability or because that level of detail is not reported for IBFs. From
December 1981 through September 1985, IBF data were included in all applicable
items reported.
4. Total assets and total liabilities include net balances, if any, due from or due
to related banking institutions in the United States and in foreign countries (see
footnote 5). On the former monthly branch and agency report, available through
the G.l 1 statistical release, gross balances were included in total assets and total
liabilities. Therefore, total asset and total liability figures in this table are not
comparable to those in the G . l l tables.
5. "Related banking institutions" includes the foreign head office and other
U.S. and foreign branches and agencies of the bank, the bank's parent holding
company, and majority-owned banking subsidiaries of the bank and of its parent
holding company (including subsidiaries owned both directly and indirectly).
6. In some cases two or more offices of a foreign bank within the same
metropolitan area file a consolidated report.
A84
Index to Statistical Tables
References are to pages A3-A83 although the prefix "A" is omitted in this index
ACCEPTANCES, bankers (See Bankers acceptances)
Agricultural loans, commercial banks, 21, 22
Assets and liabilities (See also Foreigners)
Banks, by classes, 19-22
Domestic finance companies, 35
Federal Reserve Banks, 11
Financial institutions, 27
Foreign banks, U.S. branches and agencies, 23, 80-83
Automobiles
Consumer installment credit, 38
Production, 47, 48
BANKERS acceptances, 10, 24, 25
Bankers balances, 19-22, 80-83. (See also Foreigners)
Bonds (See also U.S. government securities)
New issues, 34
Rates, 25
Branch banks, 23, 55
Business activity, nonfinancial, 44
Business expenditures on new plant and equipment, 34
Business loans (See Commercial and industrial loans)
CAPACITY utilization, 46
Capital accounts
Banks, by classes, 19, 71, 73, 75
Federal Reserve Banks, 11
Central banks, discount rates, 67
Certificates of deposit, 25
Commercial and industrial loans
Commercial banks, 17, 21, 70, 72, 74,76-79
Weekly reporting banks, 21-23
Commercial banks
Assets and liabilities, 19-22, 76-79
Commercial and industrial loans, 17, 19, 20, 21, 22, 23
Consumer loans held, by type and terms, 38, 70, 72, 74
Loans sold outright, 21
Nondeposit funds, 18, 80-83
Number by classes, 71, 73, 75
Real estate mortgages held, by holder and property, 37
Terms of lending, 76-79
Time and savings deposits, 4
Commercial paper, 24, 25, 35
Condition statements (See Assets and liabilities)
Construction, 44, 49
Consumer installment credit, 38
Consumer prices, 44, 46
Consumption expenditures, 52, 53
Corporations
Nonfinancial, assets and liabilities, 34
Profits and their distribution, 34
Security issues, 33, 65
Cost of living (See Consumer prices)
Credit unions, 38
Currency and coin, 70, 72, 74
Currency in circulation, 5, 14
Customer credit, stock market, 26
DEBITS to deposit accounts, 16
Debt (See specific types of debt or securities)
Demand deposits
Banks, by classes, 19-23, 71, 73, 75
Demand deposits—Continued
Ownership by individuals, partnerships, and
corporations, 23
Turnover, 16
Depository institutions
Reserve requirements, 9
Reserves and related items, 4, 5, 6, 13, 71, 73, 75
Deposits (See also specific types)
Banks, by classes, 4, 19-22, 23
Federal Reserve Banks, 5,11
Turnover, 16
Discount rates at Reserve Banks and at foreign central banks and
foreign countries (See Interest rates)
Discounts and advances by Reserve Banks (See Loans)
Dividends, corporate, 34
EMPLOYMENT, 45
Eurodollars, 25
FARM mortgage loans, 37
Federal agency obligations, 5, 10, 11, 12, 30, 31
Federal credit agencies, 32
Federal finance
Debt subject to statutory limitation, and types and ownership
of gross debt, 29
Receipts and outlays, 27, 28
Treasury financing of surplus, or deficit, 27
Treasury operating balance, 27
Federal Financing Bank, 27, 32
Federal funds, 7, 18, 21, 22, 23, 25, 27
Federal Home Loan Banks, 32
Federal Home Loan Mortgage Corporation, 32, 36, 37
Federal Housing Administration, 32, 36, 37
Federal Land Banks, 37
Federal National Mortgage Association, 32, 36, 37
Federal Reserve Banks
Condition statement, 11
Discount rates (See Interest rates)
U.S. government securities held, 5, 11, 12, 29
Federal Reserve credit, 5, 6, 11, 12
Federal Reserve notes, 11
Federally sponsored credit agencies, 32
Finance companies
Assets and liabilities, 35
Business credit, 35
Loans, 38
Paper, 24, 25
Financial institutions
Loans to, 21, 22, 23
Selected assets and liabilities, 27
Float, 51
Flow of funds, 39, 41, 42, 43
Foreign banks, assets and liabilities of U.S. branches and
agencies, 22, 23, 80-83
Foreign currency operations, 11
Foreign deposits in U.S. banks, 5, 11, 21, 22
Foreign exchange rates, 68
Foreign trade, 54
Foreigners
Claims on, 55, 57, 60, 61, 62, 64
A85
Foreigners—Continued
Liabilities to, 22, 54, 55, 57, 58, 63, 65,66
GOLD
Certificate account, 11
Stock, 5, 54
Government National Mortgage Association, 32, 36, 37
Gross domestic product, 51
HOUSING, new and existing units, 49
INCOME, personal and national, 44, 51, 52
Industrial production, 44, 47
Installment loans, 38
Insurance companies, 29, 37
Interest rates
Bonds, 25
Commercial banks, 76-79
Consumer installment credit, 38
Federal Reserve Banks, 8
Foreign central banks and foreign countries, 67
Money and capital markets, 25
Mortgages, 36
Prime rate, 24
International capital transactions of United States, 53-67
International organizations, 57, 58, 60, 63, 64
Inventories, 51
Investment companies, issues and assets, 34
Investments (See also specific types)
Banks, by classes, 19, 20, 21, 22, 23, 27
Commercial banks, 4, 17, 19-22, 72
Federal Reserve Banks, 11,12
Financial institutions, 37
LABOR force, 45
Life insurance companies (See Insurance companies)
Loans (See also specific types)
Banks, by classes, 19-22
Commercial banks, 4, 17, 19-22, 70, 72, 74
Federal Reserve Banks, 5, 6, 8, 11, 12
Financial institutions, 27, 37
Insured or guaranteed by United States, 36, 37
MANUFACTURING
Capacity utilization, 46
Production, 46, 48
Margin requirements, 26
Member banks (See also Depository institutions)
Federal funds and repurchase agreements, 7
Reserve requirements, 9
Mining production, 48
Mobile homes shipped, 49
Monetary and credit aggregates, 4, 13
Money and capital market rates, 25
Money stock measures and components, 4, 14
Mortgages (See Real estate loans)
Mutual funds, 34
Mutual savings banks (See Thrift institutions)
NATIONAL defense outlays, 28
National income, 51
OPEN market transactions, 10
PERSONAL income, 52
Prices
Consumer and producer, 44, 50
Stock market, 26
Prime rate, 24
Producer prices, 44, 50
Production, 44,47
Profits, corporate, 34
REAL estate loans
Banks, by classes, 17, 21, 22, 37, 72
Financial institutions, 27
Terms, yields, and activity, 36
Type of holder and property mortgaged, 37
Repurchase agreements, 7, 18, 21, 22, 23
Reserve requirements, 9
Reserves
Commercial banks, 19
Depository institutions, 4, 5, 6, 13
Federal Reserve Banks, 11
U.S. reserve assets, 54
Residential mortgage loans, 36
Retail credit and retail sales, 38, 39, 44
SAVING
Flow of funds, 39,41,42, 43
National income accounts, 51
Savings and loan associations, 37, 38, 39. (See also SAIF-insured
institutions)
Savings Association Insurance Funds (SAIF) insured institutions, 27
Savings banks, 27, 37, 38
Savings deposits (See Time and savings deposits)
Securities (See also specific types)
Federal and federally sponsored credit agencies, 32
Foreign transactions, 65
New issues, 33
Prices, 26
Special drawing rights, 5, 11, 53, 54
State and local governments
Deposits, 21, 22
Holdings of U.S. government securities, 29
New security issues, 33
Ownership of securities issued by, 21, 22
Rates on securities, 25
Stock market, selected statistics, 26
Stocks (See also Securities)
New issues, 33
Prices, 26
Student Loan Marketing Association, 32
TAX receipts, federal, 28
Thrift institutions, 4. (See also Credit unions and Savings and
loan associations)
Time and savings deposits, 4, 14, 18, 19, 20, 21, 22, 23, 71, 73, 75
Trade, foreign, 54
Treasury cash, Treasury currency, 5
Treasury deposits, 5, 11, 27
Treasury operating balance, 27
UNEMPLOYMENT, 45
U.S. government balances
Commercial bank holdings, 19, 20, 21, 22
Treasury deposits at Reserve Banks, 5, 11, 27
U.S. government securities
Bank holdings, 19-22, 23, 29
Dealer transactions, positions, and financing, 31
Federal Reserve Bank holdings, 5, 11, 12, 29
Foreign and international holdings and
transactions, 11, 29, 66
Open market transactions, 10
Outstanding, by type and holder, 27, 29
Rates, 24
U.S. international transactions, 53-67
Utilities, production, 48
VETERANS Administration, 36, 37
WEEKLY reporting banks, 21-23
Wholesale (producer) prices, 44, 50
YIELDS (See Interest rates)
A86
Federal Reserve Board of Governors
and Official Staff
ALAN GREENSPAN, Chairman
DAVID W. MULLINS, JR., Vice Chairman
OFFICE OF BOARD
MEMBERS
JOSEPH R. COYNE, Assistant
DONALD J. WINN, Assistant
WAYNE D . ANGELL
EDWARD W. KELLEY, JR.
DIVISION OF INTERNATIONAL
to the Board
to the Board
THEODORE E. ALLISON, Assistant to the Board for Federal
Reserve System Affairs
LYNN S. FOX, Special Assistant to the Board
WINTHROP P. HAMBLEY, Special Assistant to the Board
BOB STAHLY MOORE, Special Assistant to the Board
DIANE E. WERNEKE, Special Assistant to the Board
EDWIN M. TRUMAN, Staff
LARRY J. PROMISEL, Senior Associate Director
CHARLES J. SIEGMAN, Senior Associate Director
DALE W. HENDERSON, Associate Director
DAVID H. HOWARD, Senior
Adviser
DONALD B. ADAMS, Assistant
Director
PETER HOOPER III, Assistant
Director
KAREN H. JOHNSON, Assistant
Director
RALPH W. SMITH, JR., Assistant
LEGAL
FINANCE
Director
Director
DIVISION
J. VIRGIL MATTINGLY, JR., General
Counsel
SCOTT G. ALVAREZ, Associate General Counsel
RICHARD M. ASHTON, Associate General Counsel
OLIVER IRELAND, Associate General Counsel
KATHLEEN M. O'DAY, Associate General Counsel
MARYELLEN A. BROWN, Assistant to the General Counsel
OFFICE OF THE SECRETARY
WILLIAM W . WILES,
Secretary
JENNIFER J. JOHNSON, Associate Secretary
BARBARA R. LOWREY, Associate
Secretary
ELLEN MALAND, Assistant
Secretary
DIVISION OF BANKING
SUPERVISION AND REGULATION
RICHARD SPILLENKOTHEN,
Director
STEPHEN C. SCHEMERING, Deputy
DON E. KLINE, Associate
Director
Director
WILLIAM A. RYBACK, Associate
Director
FREDERICK M. STRUBLE, Associate Director
HERBERT A. BIERN, Deputy Associate Director
ROGER T. COLE, Deputy Associate Director
JAMES I. GARNER, Deputy Associate Director
HOWARD A. AMER, Assistant
Director
GERALD A. EDWARDS, JR., Assistant
Director
JAMES D . GOETZINGER, Assistant
Director
LAURA M. HOMER, Assistant
Director
JAMES V. HOUPT, Assistant
Director
DIVISION OF RESEARCH AND
MICHAEL J. PRELL,
EDWARD C. ETTIN, Deputy
Director
WILLIAM R. JONES, Associate
Director
THOMAS D. SIMPSON, Associate
Director
LAWRENCE SLIFMAN, Associate Director
DAVID J. STOCKTON, Associate Director
MARTHA BETHEA, Deputy Associate Director
PETER A. TINSLEY, Deputy Associate Director
MYRON L. KWAST, Assistant
Director
PATRICK M. PARKINSON, Assistant
Director
MARTHA S. SCANLON, Assistant
Director
JOYCE K. ZICKLER, Assistant
JOHN J. MINGO,
Director
Adviser
LEVON H. GARABEDIAN, Assistant
Director
(Administration)
DIVISION OF MONETARY
DONALD L . KOHN,
AFFAIRS
Director
DAVID E. LINDSEY, Deputy Director
BRIAN F. MADIGAN, Assistant Director
RICHARD D. PORTER, Assistant
Director
NORMAND R. V. BERNARD, Special Assistant to the Board
DIVISION OF CONSUMER
AND COMMUNITY AFFAIRS
GRIFFITH L . GARWOOD,
Director
GLENN E. LONEY, Associate
JACK P. JENNINGS, Assistant Director
DOLORES S. SMITH, Associate
MICHAEL G. MARTINSON, Assistant
Director
RHOGER H PUGH, Assistant
Director
SIDNEY M. SUSSAN, Assistant
Director
MOLLY S. WASSOM, Assistant
Director
MAUREEN P. ENGLISH, Assistant
STATISTICS
Director
Director
Director
IRENE SHAWN M C N U L T Y , Assistant
Director
Director
A87
SUSAN M . PHILLIPS
JOHN P. LAWARE
LAWRENCE B . LINDSEY
OFFICE OF
STAFF DIRECTOR
FOR
MANAGEMENT
S. DAVID FROST, Staff
Director
WILLIAM SCHNEIDER, Special
Assignment:
Project Director, National Information Center
PORTIA W. THOMPSON, Equal Employment Opportunity
Programs Officer
DIVISION OF RESERVE BANK
AND PAYMENT SYSTEMS
CLYDE H . FARNSWORTH, JR.,
Director
DAVID L. ROBINSON, Deputy Director (Finance and
Control)
CHARLES W. BENNETT, Assistant
Director
JACK DENNIS, JR., Assistant
Director
EARL G. HAMILTON, Assistant
DIVISION OF HUMAN
MANAGEMENT
DAVID L . S H A N N O N ,
RESOURCES
Director
Director
Director
Director
LOUISE L. ROSEMAN, Assistant
FLORENCE M . YOUNG, Assistant
Director
ANTHONY V. DIGIOIA, Assistant
JOSEPH H. HAYES, JR., Assistant
Director
JEFFREY C. MARQUARDT, Assistant
JOHN H. PARRISH, Assistant
Director
IOHN R. WEIS, Associate
OPERATIONS
Director
Director
OFFICE OF THE INSPECTOR
GENERAL
FRED HOROWITZ, Assistant Director
BRENT L. BOWEN, Inspector
OFFICE OF THE
DONALD L. ROBINSON, Assistant Inspector General
BARRY R. SNYDER, Assistant Inspector General
CONTROLLER
GEORGE E . LIVINGSTON,
Controller
STEPHEN J. CLARK, Assistant Controller (Programs and
Budgets)
DARRELL R. PAULEY, Assistant Controller (Finance)
DIVISION OF SUPPORT
ROBERT E . FRAZIER,
SERVICES
Director
GEORGE M . LOPEZ, Assistant
Director
DAVID L. WILLIAMS, Assistant Director
DIVISION OF INFORMATION
MANAGEMENT
STEPHEN R . MALPHRUS,
RESOURCES
Director
BRUCE M. BEARDSLEY, Deputy Director
MARIANNE M. EMERSON, Assistant Director
Po KYUNG KIM, Assistant Director
RAYMOND H. MASSEY, Assistant
EDWARD T. MULRENIN, Assistant
Director
Director
DAY W. RADEBAUGH, JR., Assistant Director
ELIZABETH B. RIGGS, Assistant
RICHARD C. STEVENS, Assistant
Director
Director
General
A88
Federal Reserve Bulletin • February 1993
Federal Open Market Committee
and Advisory Councils
FEDERAL OPEN MARKET
COMMITTEE
MEMBERS
A L A N GREENSPAN,
E. GERALD CORRIGAN, Vice Chairman
Chairman
WAYNE D . ANGELL
EDWARD W . KELLEY, JR.
EDWARD G . BOEHNE
JOHN R LAWARE
SUSAN M . PHILLIPS
SILAS KEEHN
LAWRENCE B . LINDSEY
GARY H . STERN
DAVID W . MULLINS, JR.
ROBERT D . MCTEER, JR.
ALTERNATE
J. ALFRED BROADDUS, JR.
JERRY L . JORDAN
ROBERT P. FORRESTAL
JAMES H . OLTMAN
MEMBERS
ROBERT T. PARRY
STAFF
DONALD L. KOHN, Secretary and
Economist
NORMAND R.V. BERNARD, Deputy
Secretary
JOSEPH R. COYNE, Assistant
Secretary
GARY P. GILLUM, Assistant
Secretary
J. VIRGIL MATTINGLY, JR., General
Counsel
ERNEST T. PATRIKIS, Deputy General Counsel
MICHAEL J. PRELL,
Economist
EDWIN M . TRUMAN,
Economist
JOHN M . DAVIS, Associate
RICHARD G. DAVIS, Associate
Economist
THOMAS E. DAVIS, Associate
Economist
DAVID E. LINDSEY, Associate
Economist
ALICIA H. MUNNELL, Associate
Economist
LARRY J. PROMISEL, Associate
Economist
CHARLES J. SIEGMAN, Associate
Economist
THOMAS D. SIMPSON, Associate
Economist
DAVID J. STOCKTON, Associate
Economist
Economist
WILLIAM J. MCDONOUGH, Manager of the System Open Market Account
MARGARET L. GREENE, Deputy Manager for Foreign Operations
JOAN E. LOVETT, Deputy Manager for Domestic Operations
FEDERAL ADVISORY
COUNCIL
MARSHALL N. CARTER, First District
CHARLES S. SANFORD, JR., Second District
ANTHONY P. TERRACCIANO, Third District
JOHN B. MCCOY, Fourth District
EDWARD E. CRUTCHFIELD, JR., Fifth District
E.B. ROBINSON, JR., Sixth District
EUGENE A. MILLER, Seventh District
ANDREW B. CRAIG, III, Eighth District
JOHN F. GRUNDHOFER, Ninth District
DAVID A. RISMILLER, Tenth District
(Vacancy), Eleventh District
RICHARD M. ROSENBERG, Twelfth District
HERBERT V. PROCHNOW,
WILLIAM J. KORSVIK, Associate
Secretary
Secretary
CONSUMER ADVISORY
COUNCIL
DENNY D. DUMLER, Denver, Colorado, Chairman
JEAN POGGE, Chicago, Illinois, Vice Chairman
BARRY A . ABBOTT, S a n F r a n c i s c o , C a l i f o r n i a
BONNIE GUITON, C h a r l o t t e s v i l l e , V i r g i n i a
JOHN R . ADAMS, P h i l a d e l p h i a , P e n n s y l v a n i a
JOYCE HARRIS, M a d i s o n , W i s c o n s i n
JOHN A . BAKER, A t l a n t a , G e o r g i a
GARY S . HATTEM, N e w Y o r k , N e w Y o r k
VERONICA E . BARELA, D e n v e r , C o l o r a d o
JULIA E . HILER, M a r i e t t a , G e o r g i a
MULUGETTA BIRRU, P i t t s b u r g h , P e n n s y l v a n i a
RONALD HOMER, B o s t o n , M a s s a c h u s e t t s
DOUGLAS D . BLANKE, St. P a u l , M i n n e s o t a
THOMAS L . HOUSTON, D a l l a s , T e x a s
GENEVIEVE BROOKS, B r o n x , N e w Y o r k
HENRY JARAMILLO, B e l e n , N e w M e x i c o
TOYE L . BROWN, B o s t o n , M a s s a c h u s e t t s
EDMUND MIERZWINSKI, W a s h i n g t o n , D . C .
CATHY CLOUD, W a s h i n g t o n , D . C .
JOHN V. SKINNER, I r v i n g , T e x a s
MICHAEL D . EDWARDS, Y e l m , W a s h i n g t o n
LOWELL N . SWANSON, P o r t l a n d , O r e g o n
MICHAEL FERRY, St. L o u i s , M i s s o u r i
MICHAEL W . TIERNEY, W a s h i n g t o n , D . C .
NORMA L . FREIBERG, N e w O r l e a n s , L o u i s i a n a
GRACE W . WEINSTEIN, E n g l e w o o d , N e w J e r s e y
LORI GAY, Los Angeles, California
JAMES L . WEST, T i j e r a s , N e w M e x i c o
DONALD A . GLAS, H u t c h i n s o n , M i n n e s o t a
ROBERT O . ZDENEK, W a s h i n g t o n , D . C .
THRIFT INSTITUTIONS ADVISORY
COUNCIL
DANIEL C. ARNOLD, Houston, Texas, President
BEATRICE D'AGOSTINO, Somerville, New Jersey, Vice President
WILLIAM A . COOPER, M i n n e a p o l i s , M i n n e s o t a
KERRY KILLINGER, S e a t t l e , W a s h i n g t o n
PAUL L . ECKERT, D a v e n p o r t , I o w a
CHARLES JOHN KOCH, C l e v e l a n d , O h i o
GEORGE R . GLIGOREA, S h e r i d a n , W y o m i n g
ROBERT MCCARTER, N e w B e d f o r d , M a s s a c h u s e t t s
THOMAS J. HUGHES, M e r r i f i e l d , V i r g i n i a
STEPHEN W . PROUGH, I r v i n e , C a l i f o r n i a
RICHARD D . JACKSON, A t l a n t a , G e o r g i a
THOMAS R . RICKETTS, T r o y , M i c h i g a n
A90
Federal Reserve Board Publications
For ordering assistance, write PUBLICATIONS SERVICES,
MS-138, Board of Governors of the Federal Reserve System,
Washington, D C 2 0 5 5 1 or t e l e p h o n e ( 2 0 2 ) 4 5 2 - 3 2 4 4 or F A X
(202) 728-5886. When a charge is indicated, payment should
accompany request and be made payable to the Board of
Governors of the Federal Reserve System. Payment from foreign residents should be drawn on a U.S. bank.
THE FEDERAL RESERVE SYSTEM—PURPOSES AND FUNCTIONS.
1984. 120 pp.
ANNUAL REPORT.
ANNUAL REPORT: BUDGET REVIEW, 1 9 9 1 - 9 2 .
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THE FEDERAL RESERVE ACT and other statutory provisions
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REGULATIONS OF THE BOARD OF GOVERNORS OF THE FEDERAL
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A N N U A L PERCENTAGE RATE TABLES (Truth in L e n d i n g —
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Introduction to Flow of Funds. 1980. 68 pp. $1.50 each; 10 or
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Consumer and Community Affairs Handbook. $75.00 per
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THE U . S . ECONOMY IN AN INTERDEPENDENT WORLD: A MULTICOUNTRY MODEL, M a y 1 9 8 4 . 5 9 0 p p . $ 1 4 . 5 0 e a c h .
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FINANCIAL FUTURES AND OPTIONS IN THE U . S . ECONOMY.
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PAMPHLETS
Short pamphlets suitable for classroom use. Multiple copies are
available without charge.
Consumer Handbook on Adjustable Rate Mortgages
Consumer Handbook to Credit Protection Laws
A Guide to Business Credit for Women, Minorities, and Small
Businesses
How to File A Consumer Credit Complaint
Series on the Structure of the Federal Reserve System
The Board of Governors of the Federal Reserve System
The Federal Open Market Committee
Federal Reserve Bank Board of Directors
Federal Reserve Banks
Organization and Advisory Committees
A Consumer's Guide to Mortgage Lock-Ins
A Consumer's Guide to Mortgage Settlement Costs
A Consumer's Guide to Mortgage Refinancings
Home Mortgages: Understanding the Process and Your Right
to Fair Lending
Making Deposits: When Will Your Money Be Available?
When Your Home is on the Line: What You Should Know
About Home Equity Lines of Credit
A91
STAFF STUDIES: Summaries Only Printed in the
Bulletin
1 6 0 . BANKING MARKETS AND THE USE OF FINANCIAL SERVICES BY SMALL AND MEDIUM-SIZED BUSINESSES, b y
Studies and papers on economic and financial subjects that are
of general interest. 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 Services.
161. A
Staff Studies 1-145 are out of print.
1 6 2 . EVIDENCE ON THE SIZE OF BANKING MARKETS FROM
MORTGAGE LOAN RATES IN TWENTY CITIES, b y S t e p h e n
1 4 6 . THE ROLE OF THE PRIME RATE IN THE PRICING OF
BUSINESS LOANS BY COMMERCIAL BANKS, 1 9 7 7 - 8 4 , b y
1 6 3 . CLEARANCE AND SETTLEMENT IN U . S . SECURITIES MAR-
Gregory E. Elliehausen and John D. Wolken. September
1990. 35 pp.
REVIEW OF CORPORATE RESTRUCTURING ACTIVITY,
1980-90, by Margaret Hastings Pickering. May 1991.
21 pp.
A. Rhoades. February 1992. 11 pp.
Thomas F. Brady. November 1985. 25 pp.
1 4 7 . REVISIONS IN THE MONETARY SERVICES (DIVISIA) INDEXES OF THE MONETARY AGGREGATES, b y H e l e n T. Farr
KETS, by Patrick Parkinson, Adam Gilbert, Emily Gollob,
Lauren Hargraves, Richard Mead, Jeff Stehm, and Mary
Ann Taylor. March 1992. 37 pp.
and Deborah Johnson. December 1985. 42 pp.
1 4 8 . THE MACROECONOMIC AND SECTORAL EFFECTS OF THE
ECONOMIC RECOVERY TAX ACT: SOME SIMULATION
RESULTS, by Flint Bray ton and Peter B. Clark. December
1985. 17 pp.
1 4 9 . THE OPERATING PERFORMANCE OF ACQUIRED FIRMS IN
BANKING BEFORE AND AFTER ACQUISITION, b y S t e p h e n
REPRINTS OF SELECTED Bulletin ARTICLES
Some Bulletin articles are reprinted. The articles listed below
are those for which reprints are available. Most of the articles
reprinted do not exceed twelve pages.
Limit of ten copies
A. Rhoades. April 1986. 32 pp.
1 5 0 . STATISTICAL COST ACCOUNTING MODELS IN BANKING:
A REEXAMINATION AND AN APPLICATION, b y J o h n T.
Rose and John D. Wolken. May 1986. 13 pp.
1 5 1 . RESPONSES TO DEREGULATION: RETAIL DEPOSIT PRICING
FROM 1983 THROUGH 1985, by Patrick I. Mahoney, Alice
P. White, Paul F. O'Brien, and Mary M. McLaughlin.
January 1987. 30 pp.
1 5 2 . DETERMINANTS OF CORPORATE MERGER ACTIVITY:
A
REVIEW OF THE LITERATURE, by Mark J. Warshawsky.
April 1987. 18 pp.
1 5 3 . STOCK MARKET VOLATILITY, b y C a r o l y n D . D a v i s a n d
Alice P. White. September 1987. 14 pp.
1 5 4 . T H E EFFECTS ON CONSUMERS AND CREDITORS OF
PROPOSED CEILINGS ON CREDIT CARD INTEREST RATES,
by Glenn B. Canner and James T. Fergus. October 1987.
26 pp.
1 5 5 . T H E FUNDING OF PRIVATE PENSION PLANS, b y M a r k J.
Warshawsky. November 1987. 25 pp.
1 5 6 . INTERNATIONAL TRENDS FOR U . S . BANKS AND BANKING
MARKETS, by James V. Houpt. May 1988. 47 pp.
1 5 7 . M 2 PER UNIT OF POTENTIAL G N P AS AN ANCHOR FOR
THE PRICE LEVEL, by Jeffrey J. Hallman, Richard D.
Porter, and David H. Small. April 1989. 28 pp.
1 5 8 . THE ADEQUACY AND CONSISTENCY OF MARGIN REQUIREMENTS IN THE MARKETS FOR STOCKS AND DERIVATIVE
PRODUCTS, by Mark J. Warshawsky with the assistance of
Dietrich Earnhart. September 1989. 23 pp.
1 5 9 . N E W DATA ON THE PERFORMANCE OF NONBANK SUBSIDIARIES OF BANK HOLDING COMPANIES, b y N e l l i e L i a n g
and Donald Savage. February 1990. 12 pp.
Recent Developments in the Bankers Acceptance Market. 1/86.
The Use of Cash and Transaction Accounts by American
Families. 2/86.
Financial Characteristics of High-Income Families. 3/86.
Prices, Profit Margins, and Exchange Rates. 6/86.
Agricultural Banks under Stress. 7/86.
Foreign Lending by Banks: A Guide to International and U.S.
Statistics. 10/86.
Recent Developments in Corporate Finance. 11/86.
Measuring the Foreign-Exchange Value of the Dollar. 6/87.
Changes in Consumer Installment Debt: Evidence from the
1983 and 1986 Surveys of Consumer Finances. 10/87.
Home Equity Lines of Credit. 6/88.
Mutual Recognition: Integration of the Financial Sector in the
European Community. 9/89.
The Activities of Japanese Banks in the United Kingdom and in
the United States, 1980-88. 2/90.
Industrial Production: 1989 Developments and Historical
Revision. 4/90.
Recent Developments in Industrial Capacity and Utilization.
6/90.
Developments Affecting the Profitability of Commercial Banks.
7/90.
Recent Developments in Corporate Finance. 8/90.
U.S. Exchange Rate Policy: Bretton Woods to Present. 11/90.
The Transmission Channels of Monetary Policy: How Have
They Changed? 12/90.
Changes in Family Finances from 1983 to 1989: Evidence from
the Survey of Consumer Finances. 1/92.
U.S. International Transactions in 1991. 5/92.
A92
Maps of the Federal Reserve System
LEGEND
Both
pages
• Federal Reserve Bank city
• Board of Governors of the Federal
Reserve System, Washington, D.C.
Facing
page
• Federal Reserve Branch city
— Branch boundary
NOTE
The Federal Reserve officially identifies Districts
by number and Reserve Bank city (shown on both
pages) and by letter (shown on the facing page).
In the 12th District, the Seattle Branch serves
Alaska, and the San Francisco Bank serves Hawaii.
The System serves commonwealths and territories as follows: the New York Bank serves the
Commonwealth of Puerto Rico and the U.S. Virgin
Islands; the San Francisco Bank serves American
Samoa, Guam, and the Commonwealth of the
Northern Mariana Islands. The Board of Governors
revised the branch boundaries of the System most
recently in December 1991.
A93
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BOSTON
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A94
Federal Reserve Banks, Branches,
and Offices
FEDERAL RESERVE BANK
branch, or facility
Zip
Chairman
Deputy Chairman
President
First Vice President
BOSTON*
02106
Jerome H. Grossman
To be announced
Richard F. Syron
Cathy E. Minehan
NEW YORK*
10045
Ellen V. Futter
Maurice R. Greenberg
Herbert L. Washington
E. Gerald Corrigan
James H. Oltman
Buffalo
14240
James O. Aston
PHILADELPHIA
19105
Jane G. Pepper
James M. Mead
Edward G. Boehne
William H. Stone, Jr.
CLEVELAND*
44101
Jerry L. Jordan
Sandra Pianalto
Cincinnati
Pittsburgh
45201
15230
A. William Reynolds
To be announced
Marvin Rosenberg
Robert P. Bozzone
RICHMOND*
23219
Anne Marie Whittemore
Henry J. Faison
To be announced
Anne M. Allen
J. Alfred Broaddus, Jr.
Jimmie R. Monhollon
Edwin A. Huston
Leo Benatar
Donald E. Boomershine
Joan D. Ruffier
R. KirkLandon
James R. Tuerff
Lucimarian Roberts
Robert P. Forrestal
Jack Guynn
Richard G. Cline
Robert M. Healey
J. Michael Moore
Silas Keehn
William C. Conrad
Robert H. Quenon
Janet McAfee Weakley
To be announced
To be announced
To be announced
Thomas C. Melzer
James R. Bowen
Delbert W. Johnson
Gerald A. Rauenhorst
James E. Jenks
Gary H. Stern
Thomas E. Gainor
Burton A. Dole, Jr.
Herman Cain
Barbara B. Grogan
Ernest L. Holloway
Sheila Griffin
Thomas M. Hoenig
Henry R. Czerwinski
Leo E. Linbeck, Jr.
Cece Smith
To be announced
To be announced
To be announced
Robert D. McTeer, Jr.
Tony J. Salvaggio
James A. Vohs
Judith M. Runstad
Donald G. Phelps
William A. Hilliard
Gary G. Michael
George F. Russell, Jr.
Robert T. Parry
Patrick K. Barron
Baltimore
21203
Charlotte
28230
Culpeper Communications
and Records Center 22701
ATLANTA
Birmingham
Jacksonville
Miami
Nashville
New Orleans
30303
35283
32231
33152
37203
70161
CHICAGO*
60690
Detroit
48231
ST. LOUIS
63166
Little Rock
Louisville
Memphis
72203
40232
38101
MINNEAPOLIS
55480
Helena
KANSAS CITY
Denver
Oklahoma City
Omaha
DALLAS
El Paso
Houston
San Antonio
59601
64198
80217
73125
68102
75201
79999
77252
78295
SAN FRANCISCO
94120
Los Angeles
Portland
Salt Lake City
Seattle
90051
97208
84125
98124
Vice President
in charge of branch
Charles A. Cerino1
Harold J. Swart1
Ronald B. Duncan 1
Walter A. Varvel1
John G. Stoides 1
Donald E. Nelson 1
Fred R. Herr1
James D. Hawkins 1
James T. Curry III
Melvyn K. Purcell
Robert J. Musso
Roby L. Sloan 1
Karl W. Ashman
Howard Wells
John P. Baumgartner
John D. Johnson
Kent M. Scott
David J. France
Harold L. Shewmaker
Sammie C. Clay
Robert Smith, III1
Thomas H. Robertson
John F. Moore 1
E. Ronald Liggett 1
Andrea P. Wolcott
Gordon Werkema1
•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.
1. Senior Vice President.
Publications of Interest
FEDERAL RESERVE CONSUMER CREDIT PUBUCATIONS
The Federal Reserve Board publishes a series of
pamphlets covering individual credit laws and topics,
as pictured below. The series includes such subjects
as how the Equal Credit Opportunity Act protects
women against discrimination in their credit dealings,
how to use a credit card, and how to resolve a billing
error.
The Board also publishes the Consumer Handbook
to Credit Protection Laws, a complete guide to consumer credit protections. This forty-four-page booklet
explains how to shop and obtain credit, how to maintain a good credit rating, and how to dispute unfair
credit transactions.
Three booklets on the mortgage process are also
available: A Consumer's Guide to Mortgage Lock-Ins,
A Consumer's Guide to Mortgage Refinancings, and
A Consumer's Guide to Mortgage Settlement Costs.
These booklets were prepared in conjunction with the
Federal Home Loan Bank Board and in consultation
with other federal agencies and trade and consumer
groups.
Copies of consumer publications are available free
of charge from Publications Services, mail stop 138,
Board of Governors of the Federal Reserve System,
Washington, DC 20551. Multiple copies for classroom use are also available free of charge.
Federal Reserve Statistical Releases
Available on the Commerce Department's
Economic Bulletin Board
The Board of Governors of the Federal Reserve
System makes some of its statistical releases available to the public through the U.S. Department of
Commerce's economic bulletin board. Computer
access to the releases can be obtained by sub-
scription. For further information regarding a
subscription to the economic bulletin board,
please call 202-377-1986. The releases transmitted
to the economic bulletin board, on a regular basis,
are the following:
Reference
Number
Statistical release
Frequency of release
H.3
Aggregate Reserves
Weekly/Thursday
H.4.1
Factors Affecting Reserve Balances
Weekly/Thursday
H.6
Money Stock
Weekly/Thursday
H.8
Assets and Liabilities of Insured Domestically Chartered
and Foreign Related Banking Institutions
Weekly/Monday
H.10
Foreign Exchange Rates
Weekly/Monday
H.15
Selected Interest Rates
Weekly/Monday
G.5
Foreign Exchange Rates
Monthly/end of month
G.17
Industrial Production and Capacity Utilization
Monthly/midmonth
G.19
Consumer Installment Credit
Monthly/fifth business day
Z.7
Row of Funds
Quarterly
Publications of Interest
FEDERAL RESERVE REGULATORY SERVICE
To promote public understanding of its regulatory
functions, the Board publishes the Federal Reserve
Regulatory Service, a three-volume looseleaf service
containing all Board regulations as well as related
statutes, interpretations, policy statements, rulings,
and staff opinions. For those with a more specialized
interest in the Board's regulations, parts of this service are published separately as handbooks pertaining
to monetary policy, securities credit, consumer affairs,
and the payment system.
These publications are designed to help those who
must frequently refer to the Board's regulatory materials. They are updated monthly, and each contains
citation indexes and a subject index.
The Monetary Policy and Reserve Requirements
Handbook contains Regulations A, D, and Q, plus
related materials.
The Securities Credit Transactions Handbook contains Regulations G, T, U, and X, dealing with extensions of credit for the purchase of securities, together
with related statutes, Board interpretations, rulings,
and staff opinions. Also included are the Board's list
of marginable OTC stocks and its list of foreign
margin stocks.
The Consumer and Community Affairs Handbook
contains Regulations B, C, E, M, Z, AA, and BB, and
associated materials.
The Payment System Handbook deals with expedited funds availability, check collection, wire transfers, and risk-reduction policy. It includes Regulation
CC, Regulation J, the Expedited Funds Availability
Act and related statutes, the official Board commentary on Regulation CC, and policy statements on risk
reduction in the payment system.
For domestic subscribers, the annual rate is $200
for the Federal Reserve Regulatory Service and $75
for each Handbook. For subscribers outside the
United States, the price including additional air mail
costs is $250 for the Service and $90 for each Handbook. All subscription requests must be accompanied
by a check or money order payable to the Board of
Governors of the Federal Reserve System. Orders
should be addressed to Publications Services, mail
stop 138, Board of Governors of the Federal Reserve
System, Washington, DC 20551.
U.S. MONETARY POLICY AND FINANCIAL MARKETS
U.S. Monetary Policy and Financial Markets by AnnMarie Meulendyke offers an in-depth description of
the way monetary policy is developed by the Federal
Open Market Committee and the techniques employed to implement policy at the Open Market Trading Desk. Written from her perspective as a senior
economist in the Open Market Function at the Federal
Reserve Bank of New York, Ann-Marie Meulendyke
describes the tools and the setting of policy, including
many of the complexities that differentiate the process
from simpler textbook models. Included is an account
of a day at the Trading Desk, from morning
information-gathering through daily decisionmaking
and the execution of an open market operation.
The book also places monetary policy in a broader
context, examining first the evolution of Federal
Reserve monetary policy procedures from their beginnings in 1914 to the end of the 1980s. It indicates how
policy operates most directly through the banking
system and the financial markets and describes key
features of both. Finally, the book turns its attention to
the transmittal of monetary policy actions to the U.S.
economy and throughout the world.
The book is $5.00 a copy for U.S. purchasers and
$10.00 for purchasers outside the United States. Copies are available from the Public Information Department, Federal Reserve Bank of New York, 33 Liberty
Street, New York, NY 10045. Checks must accompany orders and should be payable to the Federal
Reserve Bank of New York in U.S. dollars.
@FedFRASER