Full text of Federal Reserve Bulletin : February 1996
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VOLUME 8 2 •
NUMBER 2 •
FEBRUARY 1 9 9 6
FEDERAL RESERVE
BULLETIN
BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM, WASHINGTON, D . C .
PUBLICATIONS COMMITTEE
Joseph R. Coyne, Chairman • S. David Frost • Griffith L. Garwood • Donald L. Kohn
• J. Virgil Mattingly, Jr. • Michael J. Prell • Richard Spillenkothen • Edwin M. Truman
The Federal Reserve Bulletin is issued monthly under the direction of the staff publications committee. This committee is responsible for opinions expressed
except in official statements and signed articles. It is assisted by the Economic Editing Section headed by S. Ellen Dykes, the Graphics Center under the direction of
Peter G. Thomas, and Publications Services supervised by Linda C. Kyles.
Table of Contents
places higher priority on the effectiveness of risk
management processes and operational controls,
before the Subcommittee on Financial Institutions and Consumer Credit of the House Committee on Banking and Financial Services,
December 5, 1995.
115 AN ANALYSIS QF ^COMMERCIAL BANK
EXPOSURE TO INTEREST RATE RISK
This article evaluates some of the factors that
may be affecting the level of interest rate risk
among commercial banks and estimates the
general magnitude and significance of this risk
using data from the quarterly Reports of Condition and Income and a simple interest rate risk
model. That risk measure suggests that the
interest rate risk exposure for the vast majority
of the banking industry is not significant at
present. The article also concludes that a relatively simple model can be useful for broadly
measuring the interest rate risk exposure of institutions that do not have unusual or complex
asset characteristics.
129 STAFF
In Bank Mergers and Industrywide Structure,
1980-94, the author presents data on all bank
mergers from 1980 to 1994, including the number, sizes, locations, and types. He also places
the mergers in perspective by examining industrywide data on banking structure and performance for the period.
130 INDUSTRIAL PRODUCTION AND CAPACITY
UTILIZATION FOR DECEMBER
1995
Industrial production edged up 0.1 percent in
December, to 122.8 percent of its 1987 average,
after a revised gain of 0.3 percent in November.
Capacity utilization eased 0.2 percentage point
in December, to 82.8 percent.
TO THE
Alan S. Blinder to step down as Vice Chairman
of the Board of Governors.
Action by the Federal Open Market Committee.
Issuance of press statement and communique by
the Basle Committee on Banking Supervision.
Amendment to Regulation K.
Proposal for a one-time Check Fraud Survey;
proposed revisions to the staff commentary to
Regulation B; proposed changes to Regulation K; extension of comment period on proposed amendments to Regulation M; proposed
amendments to Regulation U; proposed revisions to the official staff commentary to Regulation Z; and proposed revisions to the official
staff commentary to Regulation DD.
Availability of videotape on the home buying
process.
Publication of the December 1995 update to the
Bank Holding Company Supervision Manual.
CONGRESS
Alan Greenspan, Chairman, Board of Governors
of the Federal Reserve System, discusses the
issues raised by the recent events relating to the
U.S. operations of Daiwa Bank; summarizes the
present system of supervision of the U.S. offices
of foreign banks; and explains several initiatives
the Federal Reserve has implemented in this
area in the past two years, including a new
uniform examination rating system for U.S.
branches and agencies of foreign banks that
ANNOUNCEMENTS
Publication of staff commentary on Regulation C.
STUDIES
133 STATEMENT
139
142 MINUTES OF THE FEDERAL OPEN
COMMITTEE MEETING HELD ON
NOVEMBER 15,
1995
MARKET
At its meeting on November 15, 1995, the
Committee adopted a directive that called for
maintaining the existing degree of pressure on
reserve positions and that did not include a
presumption about the likely direction of any
adjustments to policy during the intermeeting
period.
149 LEGAL
DEVELOPMENTS
Various bank holding company, bank service
corporation, and bank merger orders; and pending cases.
196 MEMBERSHIP OF THE BOARD OF
GOVERNORS OF THE FEDERAL RESERVE
SYSTEM,
1913-96
A 6 7 GUIDE TO STATISTICAL RELEASES
SPECIAL TABLES
A 7 6 INDEX TO STATISTICAL
TABLES
A 7 8 BOARD OF GOVERNORS
AND
AND
STAFF
A 8 0 FEDERAL OPEN MARKET COMMITTEE
STAFF; ADVISORY
COUNCILS
AND
List of appointive and ex officio members.
A 8 2 FEDERAL RESERVE BOARD
PUBLICATIONS
A1 FINANCIAL AND BUSINESS STATISTICS
These tables reflect data available as of
December 27, 1995.
A 3 GUIDE
TO TABULAR
PRESENTATION
A4 Domestic Financial Statistics
A45 Domestic Nonfinancial Statistics
A53 International Statistics
A 8 4 MAPS OF THE FEDERAL RESERVE
A 8 6 FEDERAL RESERVE BANKS,
AND OFFICES
SYSTEM
BRANCHES,
An Analysis of Commercial Bank Exposure
to Interest Rate Risk
David M. Wright and James V. Houpt, of the Board's
Division of Banking Supervision and Regulation, prepared this article. Leeto Tlou and Jonathan Hacker
provided assistance.
Banks earn returns to shareholders by accepting and
managing risk, including the risk that borrowers may
default or that changes in interest rates may narrow
the interest spread between assets and liabilities. Historically, borrower defaults have created the greatest
losses to commercial banks, whereas interest margins
have remained relatively stable, even in times of high
rate volatility. Although credit risk is likely to remain
the dominant risk to banks, technological advances
and the emergence of new financial products have
provided them with dramatically more efficient ways
of increasing or decreasing interest rate and other
market risks. On the whole, these changes, when
considered in the context of the growing competition
in financial services have led to the perception among
some industry observers that interest rate risk in
commercial banking has significantly increased.
This article evaluates some of the factors that may
be affecting the level of interest rate risk among
commercial banks and estimates the general magnitude and significance of this risk using data from the
quarterly Reports of Condition and Income (Call
Reports) and an analytic approach set forth in a
previous Bulletin article.1 That risk measure, which
relies on relatively small amounts of data and
requires simplifying assumptions, suggests that the
interest rate risk exposure for the vast majority of the
banking industry is not significant at present. This
article also attempts to gauge the reliability of the
simple measure's results for the banking industry by
comparing its estimates of interest rate risk exposure
for thrift institutions with those calculated by a more
complex model designed by the Office of Thrift
Supervision. The results suggest that this relatively
simple model can be useful for broadly measuring the
interest rate risk exposure of institutions that do not
have unusual or complex asset characteristics.
1. James V. Houpt and James A. Embersit, "A Method for Evaluating Interest Rate Risk in Commercial Banks," Federal Reserve Bulletin, vol. 77 (August 1991), pp. 6 2 5 - 3 7 .
SOURCES
OF INTEREST RATE
RISK
Interest rate risk is, in general, the potential for
changes in rates to reduce a bank's earnings or value.
As financial intermediaries, banks encounter interest
rate risk in several ways. The primary and most often
discussed source of interest rate risk stems from
timing differences in the repricing of bank assets,
liabilities, and off-balance-sheet instruments. These
repricing mismatches are fundamental to the business
of banking and generally occur from either borrowing short term to fund long-term assets or borrowing
long term to fund short-term assets.
Another important source of interest rate risk (also
referred to as "basis risk"), arises from imperfect
correlation in the adjustment of the rates earned and
paid on different instruments with otherwise similar
repricing characteristics. When interest rates change,
these differences can give rise to unexpected changes
in the cash flows and earnings spread among assets,
liabilities, and off-balance-sheet instruments of similar maturities or repricing frequencies.
An additional and increasingly important source of
interest rate risk is the presence of options in many
bank asset, liability, and ofif-balance-sheet portfolios.
In its formal sense, an option provides the holder the
right, but not the obligation, to buy, sell, or in some
manner alter the cash flow of an instrument or financial contract. Options may exist as standalone contracts that are traded on exchanges or arranged
between two parties or they may be embedded within
loan or investment products. Instruments with embedded options include various types of bonds and notes
with call or put provisions, loans such as residential
mortgages that give borrowers the right to prepay
balances without penalty, and various types of deposit
products that give depositors the right to withdraw
funds at any time without penalty. If not adequately
managed, options can pose significant risk to a banking institution because the options held by bank customers, both explicit and embedded, are generally
exercised at the advantage of the holder and to the
disadvantage of the bank. Moreover, an increasing
array of options can involve significant leverage,
which can magnify the influences (both negative and
116
Federal Reserve Bulletin • February 1996
positive) of option positions on the financial condition of a bank.
CURRENT INDICATORS
OF INTEREST RATE
RISK
The conventional wisdom that interest rate risk does
not pose a significant threat to the commercial banking system is supported by broad indicators. Most
notably, the stability of commercial bank net interest
margins (the ratio of net interest income to average
assets) lends credence to this conclusion. From 1976
through midyear 1995, the net interest margins of the
banking industry have shown a fairly stable upward
trend, despite the volatility in interest rates as illustrated by the federal funds rate (chart 1). In contrast,
over the same period thrift institutions exhibited
highly volatile margins, a result that is not surprising
given that by law they must have a high concentration of mortgage-related assets.
Interest margins, however, offer only a partial view
of interest rate risk. They may not reveal longer-term
exposures that could cause losses to a bank if the
volatility of rates increased or if market rates spiked
sharply and remained at high levels. They also say
little about the potential for changing interest rates to
reduce the "economic" or "fair" value of a bank's
holdings. Economic or fair values represent the
present value of all future cash flows of a bank's
current holdings of assets, liabilities, and off-balancesheet instruments. Approaches focusing on the sensitivity of an institution's economic value, therefore,
involve assessing the effect a rate change has on the
present value of its on- and off-balance-sheet instruments and whether such changes would increase or
decrease the institution's net worth. Although banks
1.
Net interest margins of commercial banks and thrift
institutions and the federal funds rate, 1976-95
Percent
Percent
Commercial banks
4—
— 16
.
14
•X
—
k
Federal funds rate
1
2
/
— 10
2—
—
l - ^ y
T
+
/
0 —
y'
Thrift institutions
—
8
6
4
typically focus on near-term earnings, economic
value analysis can serve as a leading indicator of the
quality of net interest margins over the long term and
help identify risk exposures not evident in an analysis
of short-term earnings.
New Products and Banking
Practices
If, as some industry observers have claimed, new
products and banking practices have weakened the
industry's immunity to changing interest rates, then
the need for more comprehensive indicators of interest rate risk such as economic value analysis may
have increased. In particular, commercial banks
are expanding their holdings of instruments whose
values are more sensitive to rate changes than the
floating-rate or shorter-term assets traditionally held
by the banking industry. The potential effect of this
trend cannot be overlooked, but it should also be kept
in perspective. Although commercial banks are much
more active in mortgage markets than they were a
decade ago, this activity has not materially altered
their exposure to changing long-term rates. Indeed,
the proportion of banking assets maturing or repricing in more than five years has increased only 1 percentage point since 1988, to a median value of
only 10 percent of assets at midyear 1995. The
comparable figure for thrift institutions at midyear
1995 was 25 percent.
However, the industry's concentration of long-term
maturities is a limited indicator of risk inasmuch as
banks have also expanded their concentration of
adjustable rate instruments with embedded options
that can materially extend an instrument's effective
maturity. For example, although adjustable rate mortgages (ARMs) may reprice frequently and avoid
some of the risk of long-term, fixed rate loans, they
also typically carry limits (caps) on the amount by
which their rates may increase during specific periods
and throughout the life of the loan. Managers who do
not take into account these features when identifying
or managing risk may face unexpected declines in
earnings and present values as rates change.
Collateralized mortgage obligations (CMOs) and
so-called structured notes are other instruments with
option features.2 They may also contain substantial
leverage that compounds their underlying level of
interest rate risk. For example, as interest rates rose
2
1 1 1 1 1 1 1 1 1 1 1 11
I 11
1980
1935
1990
1995
NOTE. Year-end data, except for 1995, which is through June 30. Commercial banks are national banks, trust companies, and state-chartered banks,
excluding savings banks insured by the Federal Deposit Insurance Corporation.
2. In general structured notes are debt securities whose cash flow
characteristics (coupon rate, redemption amount, or stated maturity)
depend on one or more indexes, or these notes may have embedded
forwards or options.
An Analysis of Commercial Bank Exposure to Interest Rate Risk
sharply during 1994, market values fell rapidly for
certain structured notes and for CMOs designated as
high risk.3 However, these instruments accounted for
less than 1 percent of the industry's consolidated
assets at midyear 1995, although individual institutions may have material concentrations.
Off-balance-sheet instruments, on the other hand,
have grown dramatically and are an important part of
the management of interest rate risk at certain banks.
The notional amount of interest rate contracts—such
as interest rate options, swaps, futures, and forward
rate agreements—has grown from $3.3 trillion in
1990 to $11.4 trillion as of midyear 1995.4 These
contracts are highly concentrated among large institutions, with fifteen banks holding more than 93 percent of the industry's total volume of these contracts
in terms of their notional values. In contrast, 94 percent of the more than 10,000 insured commercial
banks report no off-balance-sheet obligations.
Although banks do not systematically disclose the
price sensitivity of these contracts to the public, the
regulatory agencies have complete access to this necessary information through their on-site examinations
and other supervisory activities. Moreover, these contracts are concentrated at dealer institutions that mark
nearly all their positions to market daily and that
actively manage the risk of their interest rate positions. These dealer institutions generally take offsetting positions that reduce risk to nominal levels, and
they are required by bank supervisors to employ
measurement systems that are commensurate with
the risk and complexity of their positions.
Competitive
Pressures
Competitive pressures are also affecting banking
practices and the industry's management of interest
rate risk. Specifically, competition may be reducing
the banking industry's ability to manage interest rate
risk through discretionary pricing of rates on loans
and deposits. For example, growing numbers of bank
customers are requesting loan rates indexed to broad
market rates such as the London interbank offered
rate (LIBOR) rather than to the prime lending rates
that banks can more easily control.5 On the deposit
side, sluggish domestic growth since 1990, when
3. The Federal Financial Institutions Examination Council has
designated CMOs as high risk when they fail to meet certain criteria
regarding the sensitivity of their fair value to interest rate movements.
4. The notional amount of an interest rate contract is the face
amount to which the rates or indexes that have been specified in the
contract are applied to determine cash flows.
5. LIBOR is the rate at which a group of large, multinational
banking institutions agree to lend to each other overnight.
117
coupled with the more recent rise in loan demand,
has caused shifts in the structure of funding. Traditionally deposits have funded 77 percent or more of
banking assets; at midyear 1995, however, deposits
funded less than 70 percent of industry assets—a
record low. If the recent outflow of core deposits
(demand deposits and money market, savings, and
NOW accounts) continues, many banks may feel
pressured to offer more attractive rates. However, the
amount by which rates must increase to reverse the
deposit outflow is difficult to judge.
To meet the recent rise in loan demand, banks have
made up the funding shortfall with overnight borrowings of federal funds, securities repurchase agreements, and other borrowings. These funding changes
may have effectively shortened the overall liability
structure of the industry and, along with other pressures facing the industry, must be adequately considered in managing interest rate risk.
Analysis of Portfolio
Values
In this environment of new products and competitive
pressures, treasury and investment activities have
become more important for many banks in managing
interest rate risk. Although banks are constrained in
their lending and deposit-taking functions by the
preferences and demands of their customers, they
have substantial flexibility in increasing or offsetting
the resulting market risks through the securities and
interest rate contracts they choose to hold. The risk
profile of the investment securities portfolio can be
evaluated by observing changes in the portfolio's fair
value from actual rate moves. This analysis is possible because unlike most other banking assets and
liabilities, the current market value of a bank's securities portfolio is easily determined and is publicly
reported each quarter.
For example, the industry's aggregate securities
portfolio (excluding securities held for trading) for
1993:Q4 had a 1.4 percent market value premium,
which represented an unrealized gain of $11.5 billion
(chart 2). The rise in interest rates during 1994 (as
depicted by the two-year Treasury note yield) and the
resulting drop in the value of securities produced a
market value discount of 3.5 percent by 1994:Q4,
which meant a loss in value of 4.9 percentage points
($40 billion). With the subsequent fall in interest
rates during the first half of 1995, the portfolio recovered a portion of its loss and rose to a market value
premium of 0.1 percent ($1 billion) at 1995:Q2.
Although partly affected by changes in the composition of the portfolio, these results suggest that the
118
Federal Reserve Bulletin • February 1996
average duration of the industry's securities portfolio
may be roughly one and one-half to two years, a
maturity range many might view as presenting banks
with relatively little interest rate risk.6 When applied
to earlier periods, this analysis further suggests that
the price sensitivity of the industry's securities portfolio has remained largely unchanged since at least
the late 1980s.
Although this analysis of portfolio value may help
in the evaluation of risks in the securities activities of
banks, it does not consider any corresponding and
potentially offsetting changes in the economic value
of banks' liabilities or other on- or off-balance-sheet
positions. That limitation helps to explain why the
banking industry has typically ignored economic or
long-term present value effects when measuring interest rate risk.
TECHNIQUES FOR MEASURING
INTEREST RATE RISK
Historically, banks have focused on the effect that
changing rates can have on their near-term reported
earnings. Spurred in part by supervisory interest in
the matter, more recently many banks have also been
examining the effect of changing rates on the economic value of their net worth, defined as the net
present value of all expected future cash flows discounted at prevailing market rates. By taking this
approach—or more typically, considering the poten6. The duration of a security is a statistical measure used in
financial management to estimate the price sensitivity of a fixed rate
instrument to small changes in market interest rates. Specifically, it is
the weighted average of an instrument's cash flows in which the
present values serve as the weights. In effect, it indicates the percentage change in market value for each percentage point change in
market rates.
2.
Unrealized gains or losses on securities, all insured
commercial banks, and the yield on two-year
Treasury notes, 1993:Q4-1995:Q2
Two-year note yield
tial effect of rate changes on economic value as well
as on earnings—banks are taking a longer-term perspective and considering the full effect of potential
changes in market conditions. As a result, they are
more likely than before to avoid strategies that maximize current earnings at the cost of exposing future
earnings to greater risk.
Several techniques are used to measure the exposure of earnings and economic value to changes in
interest rates. They range in complexity from those
that rely on simple maturity and repricing tables to
sophisticated, dynamic simulation models that are
capable of valuing complex financial options.
Maturity
and Repricing
Tables
A maturity and repricing table distributes assets,
liabilities, and off-balance-sheet positions into time
bands according to the time remaining to repricing or
maturity, with the number and range of time bands
varying from bank to bank. Assets and liabilities that
lack specific (that is, contractual) repricing intervals
or maturities are assigned maturities based often on
subjective judgments about the ability of the institution to change—or to avoid changing—the interest
rates it pays or receives. When completed, the table
can be used as an indicator of interest rate risk
exposure in terms of earnings or economic value.
For evaluating exposure to earnings, a repricing
table can be used to derive the mismatch (gap)
between the amount of assets and the amount of
liabilities that mature or reprice in each time period.
By determining whether an excess of assets or liabilities will reprice in any given period, the effect of a
rate change on net interest income can be roughly
estimated.
For estimating the amount of economic value
exposed to changing rates, maturity and repricing
tables can be used in combination with risk weights
derived from the price sensitivity of hypothetical
instruments. These weights can be based either on
a representative instrument's duration and a given
interest rate shock or on the calculated percentage
change in the instrument's present value for a specific
rate scenario.7 In either case, when multiplied by the
balances in their respective time bands, these weights
7. Though duration is a useful measure, it has the shortcoming of
assuming that the rate of change in an instrument's price is linear,
whether for rate moves of 1 or 500 basis points. The second approach,
analyzing present values for a specific rate scenario, recognizes that
many instruments have price sensitivities that are nonlinear (a characteristic called convexity) and tailors adjustments to cash flows (such
as principal prepayments) to the specific magnitude and level of the
rate shock.
An Analysis of Commercial Bank Exposure to Interest Rate Risk
provide an estimate of the net change in the economic
value of an institution's assets, liabilities, and offbalance-sheet positions for a specific change in market rates. When expressed as a percentage of total
assets, the net change, or "net position," can also
provide an index for comparing the risk of different
institutions. Although rough, such relatively simple
measures can often provide reasonable estimates of
interest rate risk for many institutions, especially
those that do not have atypical mortgage portfolios
nor hold material amounts of more complex instruments such as CMOs, structured notes, or options.
Simulation
Techniques
Simulation techniques provide much more sophisticated measures of risk by calculating the specific
interest and principal cash flows of the institution for
a given interest rate scenario. These calculations can
be made considering only the current holdings of the
balance sheet, or they can also consider the effect of
new lending, investing, and funding strategies. In
either case, risk can be identified by calculating
changes in economic value or earnings from any
variety of rate scenarios. Simulations may also incorporate hundreds of different interest rate scenarios (or
"paths" through time) and corresponding cash flows.
The results help institutions identify the possible
range and likely effect of rate changes on earnings
and economic values and can be most useful in
managing interest rate risk, especially for institutions
with concentrations in options that are either explicit
or embedded in other instruments. Instrument valuations using simulation techniques may also be used as
the basis for sensitivity weights used in simple time
band models. However, such simulations can require
significant computer resources and, as always, are
only as good as the assumptions and modeling techniques they reflect.
Indeed, whether a bank measures its interest rate
risk relative to earnings or to economic value or
whether it uses crude or sophisticated modeling techniques, the results will rely heavily on the assumptions used. This point may be especially important
when estimating the interest rate risk of depository
institutions because of the critical effect core deposits
can have on the effective level of risk. The rate
sensitivity of core deposits may vary widely among
banks depending on the geographic location of the
depositors or on their other demographic characteristics. The sensitivity may also change over time, as
depositors become more aware of their investment
choices and as new alternatives emerge. Recog-
119
nizing these variables, few institutions claim to measure this sensitivity well, and most banks use only
subjective judgments to evaluate deposits that fund
one-half or more of their total assets. This measurement conundrum makes estimates of interest rate risk
especially difficult and underscores the lack of precision in any measure of bank interest rate risk.
THE BASIC SCREENING
MODEL
In recent years, the Federal Reserve has used a simple
screening tool, the "basic model," to identify commercial banks that may have exceptionally high levels of interest rate risk. The basic model uses Call
Report data to estimate the interest rate risk of banks
in terms of economic value by using time bands
and sensitivity weights in the manner previously
described. The available data, however, are quite
limited, with total loans, securities, large time deposits, and subordinated debt divided into only four time
bands on the basis of their final maturities or next rate
adjustment dates, and with small CDs and other
borrowed money split into even fewer time bands.8
No data are available for coupon rates or for the rate
sensitivity of off-balance-sheet positions or trading
portfolios.
These data limitations require analysts to supplement the available maturity data with other information provided in the Call Report and to make important assumptions about the underlying cash flows and
actual price sensitivities of many assets and liabilities
of banks. For example, the timing of cash flows from
loans on autos, residential mortgages, and other portfolios may differ widely as a result of their unique
amortization requirements, caps, prepayment options,
and other features. Yet Call Report data provide no
details on the types of loans or securities contained
within each time band. To distinguish among key
instrument types within each time band, each bank's
balance sheet is used as a guide to divide the balances
in the time bands into major asset types. The appendix describes that process and the derivation of risk
weights for price sensitivity.
Table 1 provides an example of the calculations
used to derive a bank's change in economic value for
a rise in rates of 200 basis points. To begin, assets
and liabilities are divided into time bands according
to their maturity; the basic model uses four time
8. Two additional time bands of data are available for subordinated
debentures because of the informational requirements of the riskbased capital standard. However, relatively few institutions have outstanding subordinated debt, and in any event, these balances do not
reflect a material source of funds.
120
Federal Reserve Bulletin • February 1996
bands. Risk weights based on the price sensitivity of
a hypothetical instrument are then applied to each
balance to derive the estimated dollar change in value
of each time band. Finally, the net of total changes in
asset and liability values gives the net change in
economic value.
As rates rise, longer-maturity assets become less
valuable to a bank, while longer-term liabilities
become more valuable. In the example shown in
table 1, the rise in rates causes the economic value of
1.
Worksheet for calculating risk-weighted net positions
in the basic model
Dollar amounts in thousands
Total
(dollars)
Risk
weight
(percent)
(1)
Balance sheet item
(2)
Change in
economic
value
(dollars)
(1) X
(2)
INTEREST-SENSITIVE ASSETS
Fixed rate mortgage products
0-3 months
3-12 months
1-5 years
More than 5 years
0
0
0
233,541
-.20
-.70
-3.90
-8.50
0
0
0
-19,851
2.932
-4.40
-129
0
0
28.858
0
-.20
-.70
-2.90
-11.10
0
0
-837
0
Nonamortizing assets
0-3 months
3-12 months
1-5 years
More than 5 years
132.438
7.319
182,373
11.194
-.25
-1.20
-5.10
-15.90
-331
-88
-9,301
-1,780
Total interest-sensitive assets
598,655
Adjustable rate mortgage products
—
Other amortizing loans and securities
0-3 months
3-12 months
1-5 years
More than 5 years
All other assets
Total assets
-32,317
85,696
684,351
INTEREST-SENSITIVE LIABILITIES
Core deposits
0-3 months
3-12 months
1-3 years
3-5 years
5-10 years
56,082
39,634
157,785
50,600
28,167
Total
332,269
CDs and other borrowings
0-3 months
3-12 months
1-5 years
More than 5 years
117.491
77,303
78,140
0
Total interest-sensitive liabilities
605,204
Other liabilities
140
476
5,838
3,542
3,380
13,376
.25
1.20
5.40
12.00
294
928
4,220
0
18,817
COMPARISON OF THE BASIC
WITH THE OTS
MODEL
MODEL
Despite its limitations, the basic model seems to be a
useful indicator of the general level of an institution's
interest rate risk. This conclusion is based on a recent
study using the more extensive interest rate risk information reported by thrift institutions and comparing
the results of the basic model with the model developed by the Office of Thrift Supervision (OTS). 10 To
help ensure that the large losses from interest rate
exposures experienced by many thrift institutions
during the 1980s are not repeated, the OTS collects
extensive interest rate risk data on them and uses a
fairly complex and sophisticated simulation model
(the OTS model) to estimate their levels of risk.
The data reported by thrift institutions consists of
more than 500 items of information about the maturities and repricing characteristics of financial instruments. These data are used in the OTS model to
calculate changes in economic value under a number
of interest rate scenarios. Although other sophisticated interest rate risk models can be used to evaluate
the effectiveness of the basic model, only the OTS
provides both a sophisticated measure of risk and an
extensive database with which to compare "bottom
line" results from hundreds of institutions.
The OTS model calculates price changes based on
data specific to each portfolio rather than relying on
time bands and hypothetical instruments. For instruments without embedded options, the model discounts static cash flows that are derived from a
portfolio's weighted-average maturity and coupon.
For instruments such as adjustable rate mortgages
that have embedded options, the OTS model uses
Monte Carlo simulation techniques and data on coupons, maturities, margins, and caps to derive market
112
Total liabilities
.25
1.20
3.70
7.00
12.00
the bank's assets to fall by a larger amount than
liabilities increase in economic value; as a result, a
net decline of $13.5 million occurs in the bank's
economic value.9 To provide an index measure, that
amount is divided by total assets to derive a "net
position" ratio o f - 1 . 9 7 percent.
605,316
Equity capital
Summary
Change in asset values
Change in liability values
Net change in economic value
Net position ratio (change in
economic value divided by total
assets) (percent)
79,035
-32,317
18,817
-13,500
-1.97
9. As mentioned earlier, the existing Call Report provides no
information on the rate sensitivity of off-balance-sheet positions, and
therefore those positions are not included in the calculation of economic value.
10. The authors would like to thank Anthony Cornyn and Donald
Edwards of the Office of Thrift Supervision for providing the thrift
industry regulatory input data and the output of the OTS Net Portfolio
Value model for the present study.
An Analysis of Commercial Bank Exposure to Interest Rate Risk
value changes. To measure interest rate risk, the
model estimates fair values under prevailing interest rates (base case) and at alternatively higher and
lower rate levels, including a uniform increase of
200 basis points for all points along the yield curve.
Any decline in economic value relative to the base
case reflects the potential interest rate risk of the
institution.
Like other models, however, the OTS model relies
on key assumptions, particularly those related to
the rate sensitivity of core deposits. Since informed
parties can disagree on the proper treatment of these
deposits, standard estimates of core deposit sensitivities were used in both models for the purpose of
comparing the results.
To perform a comparison, OTS data were obtained
for the 1,414 of 1,548 thrift institutions that supplied
such data for year-end 1994. For each thrift institution, the more than 500 pieces of OTS data were
reduced to the 24 inputs required by the basic model.
After applying the basic model's risk weights to each
position and incorporating the OTS core deposit estimates, the dollar change in economic value and a net
position ratio were calculated for each institution.
The interest rate exposures for the thrift industry
as calculated by the two models revealed strikingly
similar results. The distribution curves for interest
rate risk produced by each model (chart 3) nearly
overlap. By both measures, the median change in
economic value was about - 2 . 3 percent of assets.
Other measures of industry dispersion of interest rate
risk were similar in most respects.
These frequency distributions, however, do not
reveal differences in the two measures for individual
3.
-8
Comparison of interest rate risk exposures of the
thrift industry calculated with the basic model and the
OTS model, December 31, 1994
-6
-4
-2
Net position
0
2
4
NOTE. Observations are the net positions for 1,414 thrift institutions. The net
position is the change in economic value for a rise of 200 basis points in rates
expressed as a percentage of total assets.
121
institutions. Identifying those differences requires
regressions, scatter plots, rank ordering, and other
statistical techniques, which have been used in similar research.11 Plotting the results generated for each
thrift institution by the OTS model along one axis
and the results of the simple risk measure along the
other reveals a substantial correlation between the
results of the two models on a thrift-by-thrift basis
(chart 4). If the modeling results for each institution
were identical, they fell along the 45 degree line
shown; if they were significantly different, they fell
away from the line. A regression line drawn through
the points indicates that although the two measures
are substantially correlated, the basic model tends to
estimate higher risk than the OTS model, especially
for above-average risk levels.
Another way to evaluate the similarity of exposure
estimates made by the two models is to compare the
percentage of thrift institutions that fall within a
given level of difference. On that basis, the two
models calculated exposures that came within V2 percent of assets or less for about half the institutions
and within 1 percent or less for almost 80 percent of
them. Given that industry interest rate exposures
showed a broad range of 11 percentage points
(roughly +3 to - 8 percent), these differences appear
fairly small and suggest that the basic model performs well relative to a more complex model in
placing an institution along the risk exposure spectrum. However, depending on the model's purpose,
these differences may not be satisfactory. For example, the level of acceptable precision should vary
depending on whether the model is for identifying
and monitoring the general magnitude of risk, for
making strategic decisions that precisely adjust the
bank's risk levels, or for evaluating capital adequacy.
In evaluating a model, other characteristics of its
performance may also be significant to users. For
example, if the model is to be used by regulators for
surveillance purposes, the model should also be
evaluated on its ability to identify institutions that are
taking relatively high levels of risk. In this context,
the basic model identified nearly two-thirds of the
institutions ranked by the OTS model in the top risk
quintile of all institutions and 90 percent of the
institutions that were ranked by the OTS model in the
top 40 percent. Assuming that the OTS model has
correctly identified high-risk institutions, these results
11. James M. O'Brien, "Measurement of Interest Rate Risk for
Depository Institution Capital Requirements and Preliminary Tests of
a Simplified Approach" (paper presented at the Conference on Bank
Structure and Competition sponsored by the Federal Reserve Bank of
Chicago, May 6 - 8 , 1992).
122
Federal Reserve Bulletin • February 1996
suggest that there is clear room for improvement in
the basic model's identification of high-risk institutions but that, even so, a simple model can provide a
useful screen. When used as a supervisory tool, the
model and its results can be validated during on-site
examinations of interest rate risk.
DIFFERENCES IN ESTIMATES
OF INTEREST RATE RISK EXPOSURE
The magnitude of differences between exposure estimates from the two models will depend on two
factors: (1) the difference in price sensitivity calculated for a given portfolio and (2) the relative prominence of a particular portfolio relative to the balance
sheet. So, for example, a relatively small difference
in an adjustable rate mortgage portfolio that makes
up three-quarters of the balance sheet may translate
into fairly large differences in the net position ratio.
On the other hand, a large difference in the valuation
of a high risk CMO that makes up less than 1 percent
of assets would have a minimal effect on the net
position ratio.
The largest differences between the two models'
estimates of risk exposure for thrifts arise from
4.
Comparison of interest rate risk exposures of individual
thrift institutions calculated with the basic model and
the OTS model, December 31, 1994
adjustable rate and fixed rate mortgage portfolios,
which make up the bulk of the assets of most thrift
institutions. The differences in calculations of mortgage price sensitivity occur when the basic model's
generic assumptions regarding maturity, coupon, cap,
or other characteristics do not reflect actual portfolio
characteristics that are taken into account by the OTS
model. For roughly half the institutions, these simplifying assumptions produce differences of V2 percent
or less in the two models' estimates of risk exposure
relative to assets.
For institutions classified as high risk by one model
but not the other, the largest differences arose from
three principal sources. First, some high-risk thrift
institutions held high concentrations of equities and
equity mutual fund balances (15-40 percent of
assets), which were assigned a price sensitivity by the
OTS model of - 9 . 0 percent but were not given a
price sensitivity by the basic model. Because the vast
majority of banks have minimal or no equity holdings, the basic model was not designed to address
them. Second, for thrifts with large holdings of certain types of adjustable rate mortgages, the single risk
weight used by the basic model translated into a
fairly large underestimation of risk relative to that
estimated by the OTS model. And third, the basic
model tended to overstate the risk of longer-term
amortizing assets relative to the results of the OTS.
POTENTIAL
ENHANCEMENTS
TO THE BASIC MODEL
To evaluate the potential measurement benefits of
using more data than are currently available from the
four time bands of bank Call Reports, the basic
model was expanded and run using thrift data. The
changes to the basic model produced results that are
much closer to those generated by the OTS model.
These enhancements are similar to certain features
recently described by the banking agencies in their
proposed "baseline" measure of interest rate risk.12
They include expanding the number of time bands
from four to seven by dividing the existing one- to
five-year time band into one- to three-year and threeto five-year periods and splitting the more than fiveyear band into three periods separated at the ten-year
and twenty-year points.
NOTE. Observations are the net positions for 1,414 thrift institutions. The net
position is the change in economic value for a rise of 200 basis points in rates
expressed as a percentage of total assets.
12. "Proposed Interagency Policy Statement Regarding the Measurement of Interest Rate Risk, Federal Register (August 2, 1995),
pp. 39490-572.
An Analysis of Commercial Bank Exposure to Interest Rate Risk
Further changes involved obtaining minimal information about the repricing frequency and lifetime
caps on adjustable rate loans, separately identifying
low- or zero-coupon assets, and requiring institutions
to self-report the effects of a specific rate movement
on the market values of CMOs, servicing rights, and
off-balance-sheet derivatives. For this exercise, the
values calculated by the OTS model for CMOs, servicing rights, and off-balance-sheet derivative items
were used as a proxy for values that would be selfreported by the institution. Such changes expanded
the number of items evaluated by the model from
twenty-four to sixty-three and the number of risk
weights from twenty-two to forty.
Such relatively small improvements virtually
eliminated the differences in how the enhanced and
OTS models evaluate the thrift industry's overall
interest rate risk. As shown in chart 5, the regression
and 45 degree lines (which were already close)
almost converge, and the two models produce results
that are within 100 basis points of each other for
more than 90 percent of all thrifts (table 2). In addition, the enhanced version of the basic model (the
enhanced model) significantly improved the rank
ordering of risk achieved by the basic model by
increasing the percentage of thrifts that were ranked
5.
Comparison of interest rate risk exposures of individual
thrift institutions calculated with the enhanced model
and the OTS model, December 31, 1994
2.
123
Percentage of thrift institutions falling within a given
range of difference in net position
Range of difference in net position
(basis points)
0-50
0-100
Basic model
Enhanced model
OTS model
OTS model
48.8
79.4
67.6
91.0
by both the enhanced and the OTS models in the top
quintile from 62.9 percent to 76.0 percent. The vast
majority of the measured improvement resulted from
the increase in time bands.
THE IMPORTANCE OF ASSUMPTIONS
ABOUT CORE DEPOSITS
All the previous comparisons of the results of the
models and all the previous estimates of risk used a
uniform assumption for core deposits. The importance of assumptions regarding the rate sensitivity of
core deposits has been stressed several times. For
example, replacing the assumptions used by OTS
with those proposed by the banking agencies produces a difference of 30-40 basis points in the average measure of the thrift industry's interest rate risk
as calculated with the basic model (chart 6). Given
sufficient flexibility in the treatment of core deposits,
the results of different interest rate risk models could
easily vary widely, regardless of whether the models
are similar in complexity and sophistication.
6.
Effect of different assumptions for core deposits on
interest rate risk exposures of the thrift industry
calculated with the basic model, December 31, 1994
Enhanced model
NOTE. Observations are the net positions for 1,414 thrift institutions. The net
position is the change in economic value for a rise of 200 basis points in rates
expressed as a percentage of total assets.
NOTE. Observations are the net positions for 1,414 thrift institutions. The net
position is the change in economic value for a rise of 200 basis points in rates
expressed as a percentage of total assets.
124
Federal Reserve Bulletin • February 1996
ESTIMATED INTEREST RATE
OF COMMERCIAL
BANKS
8.
RISK
Because the basic and OTS models produced fairly
similar results for thrift institutions (charts 3 and 4),
the basic approach was considered a workable model
for commercial banks, especially given that mortgage
products (the primary source of differences) are much
less important in bank balance sheets. When applied
to the data submitted at year-end 1994 by 10,452
commercial banks, the basic model shows, on average, little interest rate risk posed by an instantaneous
parallel rise in rates of 200 basis points (chart 7).
The median exposure was -0.03 percent of assets,
although 5 percent of all banks had exposures worse
than - 2 . 0 percent. Of course, this relatively balanced
view of the banking industry's exposure is highly
dependent on the subjective estimates of the price
sensitivity of core deposits (in the case of chart 7,
those assumed by the federal banking agencies) and
should be viewed in that context.
The net exposures of the industry will change over
time as institutions respond to changes in market
opportunities and in customer demands. The generally neutral overall position of commercial banks
may not be uncharacteristic, however. Since 1991,
the industry's median net position ratio calculated
with the basic model has been close to zero most of
the time and was - 2 3 basis points at year-end 1991
(chart 8). Even a commercial bank consistently
ranked at the 90th percentile (top 10 percent) of
risk had a measured exposure of no worse than
- 1 . 7 percent.
Net position
" t
Increase in
economic value
_ ,
„ .
Bank at 10th percenule of risk
2
Median
+
ii
0
Bank at 90th percentile of risk
—
Decrease in
economic value
1992
2
1994
NOTE. Observations are the net positions of more than 10,000 commercial
banks calculated with the basic model under banking agency assumptions about
core deposits. The net position is the change in economic value for a rise of
200 basis points in rates expressed as a percentage of total assets. Year-end data
except for 1995.
COMPARISON OF THE THRIFT
AND BANKING
INDUSTRIES
With the distributions of interest rate risk for commercial banks and thrift institutions, we can compare
their exposures and consider the relative importance
of interest rate risk to each group. Applying the core
deposit assumptions proposed by the banking agencies to both groups, the comparison shows, not surprisingly, that thrift institutions have significantly
higher risk exposures than banks (chart 9). As before,
net exposures of the banking industry are centered
9.
7.
Interest rate risk trends in the commercial banking
industry, calculated with the basic model,
December 31, 1991-June 30, 1995
Distribution of interest rate risk exposure of the
commercial banking industry calculated with the
basic model, December 31, 1994
Comparison of interest rate risk exposures of the
thrift and banking industries calculated with the
basic model, December 31, 1994
Percentage of institutions
Percentage of institutions
50
Commercial banks
—
40
—
30
{
\
-10
Net position
NOTE. Observations are the net positions for 1,414 thrift i siuin. The net
nt t s
to
position is the change in economic value for a rise of 200 basis points in rates
expressed as a percentage of total assets.
-8
-6
-4
-2
Net position
0
— 20
— 10
2
4
6
NOTE. Observations are the net positions of more than 10,000 commercial
banks and 1,414 thrift institutions calculated with the basic model and banking
agency assumptions for core deposits. The net position is the change in economic value for a rise of 200 basis points in rates expressed as a percentage of
total assets.
An Analysis of Commercial Bank Exposure to Interest Rate Risk
around zero and skewed noticeably to the left, suggesting that most bank outliers are exposed to rising
rates. Thrift institutions, however, have an average
exposure of - 2 . 0 percent (exposing them, too, to
rising rates), with the distribution centered rather
evenly around that point.
Although some commercial banks may have as
much interest rate risk as many thrift institutions, this
analysis suggests that the exposure of the two industries is much different, a conclusion consistent with
current and past indicators. The primary cause of the
difference is, of course, the heavier concentration
of mortgage products among thrift institutions. The
median price sensitivity of thrift assets was calculated at 5.1 percent, compared with 3.0 percent for
banks. The median figures for liabilities were much
closer, at 3.7 percent and 3.4 percent respectively.
LIMITATIONS
OF
FINDINGS
Conclusions regarding the reliability of the basic
model are limited to a single interest rate scenario;
further research must be conducted to determine
whether the basic model's performance can be maintained over more diverse interest rate scenarios such
as falling rates and nonparallel shifts in yield curves.
Moreover, despite a strong correlation with exposure
estimates produced by the OTS model, limitations in
commercial bank data could conceal an increase in
the industry's risk profile. For example, if an institution lengthened the maturity of assets in the longest
time band (more than five years) from ten to twenty
years, the related risk would not be identified by the
data currently collected. Such deficiencies suggest
that relatively minor enhancements to regulatory
reporting, such as one or more additional time bands,
could materially improve supervisors' understanding
and monitoring of bank risk profiles.
CONCLUSION
Interest rate risk does not currently appear to present
a major risk to most commercial banks. Nevertheless,
for individual institutions, interest rate risk must be
carefully monitored and managed, especially by institutions with concentrations in riskier or less predictable positions.
Measuring interest rate risk is a challenging task
and is made even more difficult for depository institutions because of the uncertainty regarding core
deposit behavior and the options embedded throughout their balance sheets. Critical assumptions are
125
needed regarding customer behavior, and those
assumptions may often determine a model's results,
making precise estimates of risk unattainable. Financial innovations and the evolution in banking markets
have made the measurement of interest rate risk even
more challenging; nonetheless, the limited banking
industry data suggest that the majority of bank risk
profiles have not been significantly altered by these
developments. Although "blind spots" arising from
data limitations exist, the relatively small industry
concentrations of complex instruments or instruments maturing in more than five years suggest that
errors from insufficient data are unlikely to materially
change conclusions regarding the industry's overall
risk profile.
Comparing the results of a simple risk measure
(the basic model) with those of a more sophisticated
technique that uses substantially more data (the
enhanced model) suggests that a simple measure
performs well in measuring an industry's risk exposure and may be capable of identifying the general
magnitude of risk for most institutions. Fairly small
increases in the amount of data on maturities and
other factors appear to improve significantly a simple
model's performance in measuring the risk of individual institutions and identifying those taking the
greatest amount of risk. Considering that rough
assumptions must be made about the price sensitivity
of core deposits and the potential that simple models
appear to have for measuring risk, supervisors and
managers may find simple measurement approaches
useful for monitoring an institution's interest rate
risk.
APPENDIX: THE DERIVATION OF TIME
CATEGORIES AND RISK WEIGHTS
BAND
The basic model divides an institution's balance sheet
into several categories and distributes the balances
among four time bands on the basis of their final
maturities or repricing frequency. The amounts within
each band are then multiplied by a risk weight based
on the estimated percentage change in value of a
representative instrument for a given change in market interest rates. For mortgage products these risk
weights also reflect the effect of loan prepayments
that are expected to result from the designated rate
change. Once the estimated effects on assets and
liabilities are combined, they can be expressed as a
percentage of total assets to derive an index measure
of interest rate risk.
The key asset categories used in the basic model
are the following: fixed rate mortgage products,
126
Federal Reserve Bulletin • February 1996
adjustable rate mortgage products, other amortizing
assets, and nonamortizing assets. Because time band
data on the Call Report are limited to two asset
categories, total loans and total securities, each
bank's balance sheet is used as a guide to slot its
assets into these four major asset types.
The four time bands for total loans and total securities are analytically divided into the four asset categories using some assumptions and the process of
elimination. For example, the balance of fixed rate
residential mortgage loans is deducted from the longest asset time band (the fourth) and placed in the
fourth time band of the mortgage category. If the
mortgage balance is larger than the available amount
of the asset time band, then any residual balance is
deducted from the next longest time band (the third)
and so on until the total fixed rate mortgage balance
is accounted for. This procedure is repeated throughout the program for other assets such as mortgage
pass-through securities, consumer installment loans,
and so forth. Once fixed rate mortgage products,
other amortizing assets, and adjustable rate mortgages are accounted for and totaled by time band, all
residual time band balances are assumed to be
nonamortizing.
For liabilities other than core deposits, the process
is straightforward because CDs, other borrowings,
and subordinated debentures are generally homogeneous, nonamortizing products and usually do not
contain embedded prepayment or other options.
Therefore specific assumptions regarding the composition of these time bands are unnecessary.
The category presenting the greatest challenge for
evaluating price sensitivity is nonmaturity core
deposits, which fund one-half of a typical bank's
balance sheet. Because these deposits have no stated
maturity and typically do not reprice as quickly as
general market rates, their effective maturity or
repricing frequency must be analytically derived. The
A. 1.
Core deposits, grouped by type of account and
distributed by assumed effective maturity or
repricing frequency
Percent
Type of account
Commercial demand
deposit
Retail demand deposits,
savings, and NOWs .
Money market deposits ..
3-12
1-3
0-3
months months years
3-5
years
5-10
years
All
50
0
30
20
...
0
50
60
50
20
20
of Risk
Weights
The risk weights are derived from a present value
analysis that estimates the expected change in value
of hypothetical instruments in response to a shift in
rates of 200 basis points (table A.2). As a surveillance tool, the basic model's risk weights are recalculated when changes in market conditions are considered large enough to require it. As used for this
article, the risk weights for the seven-time-band
model of the banking agencies' policy statement are
adapted to the basic model.
The assumed coupons of the hypothetical
instruments—7.5 percent for assets and 3.75 percent
for interest-bearing liabilities—are thought to be generally representative of those in the banking industry
during 1994. In addition, instruments are assumed to
mature or reprice at the midpoints of the time bands.
To adapt risk weights for seven time bands to four
time bands, an average of the two risk weights for the
one- to three-year and three- to five-year time bands
is used. For instruments maturing in more than five
years, the risk weight relates to the time bands for
five to ten years, ten to twenty years, or more than
twenty years based on the likely portfolio maturity
for that category. For mortgage products, whose value
is dependent on prepayment rates and the behavior of
periodic and lifetime caps, risk weights were derived
from estimates calculated by the OTS model, which
factors in the effect of these embedded options in
their values.
100
100
NOTE. Core deposits have no stated maturity and therefore are not slotted
into time bands in the Call Report. Because the number of time bands was not
limited to the four used in the Call Report, five were derived and used in both
the basic and enhanced models. Five time bands were derived because this
breakdown was considered the most analytically useful.
Derivation
100
0
0
lack of historical data and of commonly accepted
methodologies to adequately measure their price sensitivity makes uncertain the slotting of these deposits
into their appropriate time bands. Though many
banks believe that their core deposits are especially
insensitive to interest rate moves and therefore are of
fairly long effective maturity, increased competitive
pressures and changing customer demographics raise
questions in that regard. The time bands used in the
enhanced model are those used by the federal banking agencies in their proposed Joint Agency Policy
Statement on Measuring Interest Rate Risk (Policy
Statement) (.Federal Register, August 2, 1995). Core
deposits are divided into three categories and slotted
among five possible time bands (table A.l).
Potential
Errors of the Basic
Approach
Obviously the basic model contains potential estimation errors. One misestimation of risk can occur
An Analysis of Commercial Bank Exposure to Interest Rate Risk
just under five years rather than the midpoint maturity of three years. In that case the actual price change
for an increase of 200 basis points in rates would be
7.8 percent rather than the assumed 5.1 percent
change of the hypothetical instrument.
when actual bank financial instruments vary from the
assumed hypothetical instrument's maturity. For
example, in the most extreme scenario, all the assets
slotted in the one- to five-year time band for nonamortizing assets could have a maturity skewed to
A.2.
127
Derivation of the risk weights for the basic and enhanced model
Percent
Enhanced model
Time band
Maturity1
Coupon
(percent)
Price
(percent of par)
Basic model
Risk weights
(percent)
2
Risk weights2
(percent)
Price
(percent of par)
O T S DERIVED RISK WEIGHTS
Fixed-rate mortgages
0-3 months
3-12 months
1-3 years
1-5 years
3-5 years
5-10 years
10-20 years
More than 20 years
1.5 months
7.5 months
2 years
3 years
4 years
7.5 years
15 years
25 years
7.50
7.50
7.50
7.50
7.50
7.50
7.50
7.50
99.80
99.30
98.00
-.20
-.70
-2.00
94.30
92.40
91.50
88.50
-5.70
-7.60
-8.50
-11.50
Adjustable-rate mortgages3
Reset frequency
0-6 months4
6 months-1 year5
More than 1 year6
Near lifetime cap7
6 months
12 months
3 years
12 months
7.50
7.50
7.50
7.50
95.80
95.60
93.40
93.00
-4.20
-4.40
-6.60
-7.00
1.5 months
7.5 months
2 years
3 years
4 years
7.5 years
15 years
25 years
7.50
7.50
7.50
7.50
7.50
7.50
7.50
7.50
99.80
99.30
98.00
-.20
-.70
-2.00
96.30
93.50
88.90
84.90
-3.70
-6.50
-11.10
-15.10
7.508
7.50S
7.50
7.50
7.50
7.50
99.75
98.80
96.40
-.25
-1.20
-3.60
9
<W§&3 . 4 0
10-20 years
More than 20 years
1.5 months
7.5 months
2 years
3 years
4 years
7.5 years
15 years
25 years
-6.60
-10.60
-15.90
-19.00
Liabilities
0-3 months
3-12 months
1-3 years
1-5 years
3-5 years
5-10 years
10-20 years
More than 20 years
1.5 months
7.5 months
2 vears
3 vears
4 years
7.5 years
15 years
25 years
3.758
3.758
3.75
3.75
3.75
3.75
3.75
3.75
1.5 months
7.5 months
2 years
4 years
7.5 years
15 years
25 years
0
99.80
99.30
96.10
-3.90
91.50
-8.50
95.60
(KB
-.20
-.70
-4.40
...
STATIC DISCOUNTED CASH FLOWS
Other amortizing instruments
0-3 months
3-12 months
1-3 years
1-5 years
3-5 years
5-10 years
10-20 years
More than 20 years
All other instruments
0-3 months
3-12 months
1-3 years
1-5 years
7.50
7.50
fig
mm
0
0
0
0
0
0
NOTE. All estimates are based on a rise in interest rates of 200 basis points.
1. With the exception of fixed rate and adjustable rate mortgages, no prepayments are assumed for these hypothetical instruments.
2. Calculated using a rounding convention.
3. Coupons on adjustable rate mortgages (ARMs) are assumed to adjust to an
index based on Treasury yields on actively traded issues adjusted to constant
maturities. On the first reset date, the coupon rate will adjust to the index yield
plus the margin. Most ARMs also have caps on the amount the rate can change.
A periodic cap limits the amount by which a coupon rate may adjust on the reset
date. A lifetime cap prevents the coupon rate from adjusting above a preset limit
during the life of the mortgage.
—.20
-.70
...
97.10
-2.90
. . .
88.90
-if.io
99.75
98.80
BR®
-.25
-1.20
94.90
s
•agji
mi j j f j
89.40
84.10
81.00
100.25
101.20
103.70
-v
WIM
.25
.. .
. . .
84.10
. Mi B p l f
-5.io
^^HsSsillft^W
100.25
101.20 j j | g
1.20
3.70
-15.90
.25
1.20
105.40
107.00
12.00
119.90
126.30
-.25
-1.20
12.00
19.90
26.30
99.75
98.80
96.20
92.60
86.60
75.00
61.90
5.40
112.00
7.00
112.00
Zero- or low-coupon securities9
3-12 months
1-3 years
3-5 years
5-10 years
10-20 years
More than 20 years
99.80
99.30
-3.80
-7.40
-13.40
jHH
• _
8 5
...
...
. . .
• • • lllliP
-25.00
-38.10
4. Six-month Treasury yield; the margin is 275 basis points; the periodic cap
is 100 basis points; the lifetime cap is 500 basis points.
5. Twelve-month Treasury yield; the margin is 275 basis points; the periodic
cap is 200 basis points; the lifetime cap is 500 basis points.
6. Three-year Treasury yield; the margin is 275 basis points; the periodic cap
is 200 basis points; the lifetime cap is 500 basis points.
7. Twelve-month Treasury yield; the margin is 275 basis points; there is no
periodic cap; the lifetime cap is 200 basis points.
8. Actual initial price is slightly less than par.
9. Price is represented as a percentage of purchase price.
128
Federal Reserve Bulletin • February 1996
In addition, errors can result from using incorrect
coupon rates. For example rather than the hypothetical coupon of 7.5 percent, a bank's actual assets
could have coupons skewed to 10.5 percent, resulting
in an actual price change of 4.9 percent rather than
5.1 percent. Though coupon differences for most
instruments result in minor errors, coupon differences
for mortgage products can create much larger errors
because the coupon also strongly influences the
mortgage's prepayment behavior and thus its value.
Nevertheless, assuming a bank's actual maturities
and coupons are fairly evenly distributed or centered
around the hypothetical instrument's maturity and
coupon, errors should not be material.
Another source of error could come from instruments such as CMOs and structured notes whose
time band slotting is based on contractual maturities
or repricing dates but whose detailed features can
cause highly specific and unusual cash flow behavior.
These instruments could cause potentially more significant errors for the basic model; and the errors
would be further compounded for institutions that use
off-balance-sheet derivative instruments because no
data are available to evaluate whether those instruments reduce or increase an institution's risk. As of
year-end 1994, 578 of the 10,452 commercial banks
used off-balance-sheet derivative contracts based on
interest rates.
•
129
Staff Studies
The staff members of the Board of Governors of the
Federal Reserve System and of the Federal Reserve
Banks undertake studies that cover a wide range of
economic and financial subjects. From time to time
the studies that are of general interest are published
in the Staff Studies series and summarized in the
Federal Reserve Bulletin. The analyses and conclusions set forth are those of the authors and do not
STUDY
necessarily indicate concurrence by the Board of
Governors, by the Federal Reserve Banks, or by
members of their staffs.
Single copies of the full text of each study are
available without charge. The titles available are
shown under "Staff Studies" in the list of Federal
Reserve Board publications at the back of each
Bulletin.
SUMMARY
BANK MERGERS AND INDUSTRYWIDE
Stephen A.
STRUCTURE,
1980-94
Rhoades
This study presents data on all bank mergers from
1980 to 1994, including the number, sizes, locations,
and types. To place the mergers in perspective, the
paper also examines industrywide data on banking
structure and performance, including data on
branches, ATMs, stock prices, and changes in the
number of organizations over the period.
Among other findings, the data show that
(1) 1980-94 was a period of record merger activity,
with more than 6,300 mergers and $1.2 trillion in
acquired assets; (2) several of the largest mergers
in U.S. banking history, including BankAmericaSecurity Pacific and Chemical Bank-Manufacturers
Hanover, took place during the subperiod 1991-94;
(3) the number of banks declined and nationwide
banking concentration increased substantially while
local market concentration changed little; and (4) the
number of banking offices continued to grow even as
the number of ATMs exploded. The data on ATMs
and banking offices, along with other information,
suggest that electronic banking is not yet close to
providing a substitute for branch offices and that the
branch office may be an important retail platform
differentiating banks from other providers of financial services.
•
130
Industrial Production and Capacity Utilization
for December 1995
Released for publication
January
24
Industrial production edged up 0.1 percent in December after a revised gain of 0.3 percent in November.
Gains in business equipment and construction supplies were largely offset by small declines in consumer goods and materials. The end of a strike at a
major aircraft producer in mid-December accounted
for nearly half of the gain in business equipment
and boosted total production a bit less than 0.1 percent. For the fourth quarter, industrial production
grew at an 0.8 percent annual rate after having risen
at a 3.2 percent annual rate in the third quarter.
At 122.8 percent of its 1987 average, industrial
production in December was 1.1 percent higher
than it was in December 1994. Capacity utilization eased 0.2 percentage point in December, to
82.8 percent.
Industrial production indexes
Twelve-month percent change
Twelve-month percent change
10
Materials
Products
1989
1990
1991
1992
1993
1994
1995
1989
1990
1991
1992
1993
1994
1995
Capacity and industrial production
Ratio scale, 1987 production = 100
- Total industry
Capacity
Ratio scale, 1987 production = 100
140
— Manufacturing
Capacity
—-
~
120
'——^-^^^Production^^*
120
100
^
100
Production
80
1
1
1
1
1
1
1
1
1
1
1
1
1
80
1
1
140
1
1
1
1
1
1
1
1
Percent of capacity
1
1
1
1
1
Percent of capacity
Manufacturing
Total industry
—
—
Utilization
90
90
Utilization
80
70
1
1981
1
1
1983
1
1
1985
1
1987
1989
1991
I
1993
1
1995
80
70
1
1981
1
1
1983
1
1985
All series are seasonally adjusted. Latest series, December. Capacity is an index of potential industrial production.
1987
1989
1
1
1991
1
1
1993
1
1995
131
Industrial production and capacity utilization, December 1995
Industrial production, index, 1987 = 100
Percentage change
Category
1995
19951
Sept.
r
Oct.
r
Nov.
r
r
r
Nov.
r
Dec.P
Sept.
122.8
.1
-.4
.3
.2
-.3
.2
Oct.
Total
122.8
122.3
122.7
Previous estimate
122.9
122.5
122.85
Major market groups
Products, total2
Consumer goods
Business equipment
Construction supplies
Materials
119.4
116.0
158.2
108.4
128.1
118.5
115.2
156.5
108.0
128.2
118.7
115.5
157.4
108.7
128.7
119.0
115.4
158.8
109.6
128.6
.1
.2
.5
1.4
.0
-.7
-.7
-1.1
-.4
.1
Major industry groups
Manufacturing
Durable
Nondurable
Mining
Utilities
124.9
134.4
114.4
100.0
122.7
124.4
133.4
114.5
98.0
123.3
124.7
134.5
113.8
97.7
125.1
124.8
134.9
113.6
97.6
125.6
.6
1.0
.1
.0
-4.8
-.4
-.7
.1
-2.0
.5
Dec.P
.1
1.1
.2
.3
.6
.6
.4
.2
-.2
.9
.8
-.1
.7
-.1
4.9
-.9
1.6
.2
.8
-.5
-.3
1.5
.1
.3
-.2
-.2
.4
.8
2.8
-1.7
-3.2
7.8
MEMO
Capacity utilization, percent
1994
Average,
1967-94
Low,
1982
Dec. 1994
to
Dec. 1995
High,
1988-89
1995
Capacity,
percentage
change,
Dec. 1994
to
Dec. 1995
Dec.
Total
Sept.r
Oct.r
Nov.r
Dec.P
83.6
83.0
83.0
82.8
3.9
83.7
83.2
83.1
82.8
81.1
86.8
89.2
90.7
82.2
80.5
86.1
87.5
91.0
82.1
80.3
86.3
87.2
92.3
81.8
80.1
86.0
87.0
92.5
4.3
4.9
2.9
.1
1.1
82.1
71.8
84.9
85.1
81.4
80.7
82.6
87.4
86.9
70.0
71.4
66.8
80.6
76.2
85.2
83.5
89.0
86.5
92.6
84.7
82.4
90.2
89.9
86.8
Previous estimate
Manufacturing
Advanced processing
Primary processing
Mining
Utilities
NOTE. Data seasonally adjusted or calculated from seasonally adjusted
monthly data.
1. Change from preceding month.
When analyzed by market group, the data show
that the output of consumer goods slipped 0.2 percent, with the weakness concentrated among industries producing nondurable goods. The production of
durable consumer goods rose 1.2 percent, largely
because of an increase in the output of automotive
products. Although the production of other durable
goods, such as carpeting and furniture, also increased
noticeably, the overall gain in this grouping was held
down a bit as the output of appliances and televisions
reversed some of its sharp rise in November. The
output of business equipment rose 0.9 percent,
boosted by the end of the aircraft strike and ongoing
strength in the production of information processing
equipment such as computers. However, the production of industrial equipment has been sluggish lately,
on balance having changed little since August. The
output of construction supplies increased noticeably
in both November and December; in the fourth quarter, production expanded at about a 4Vi percent
annual rate after a 1 percent gain in the previous
quarter.
2. Contains components in addition to those shown,
r Revised,
p Preliminary.
The output of materials edged down, with a decline
in durable materials about offsetting small gains in
nondurable and energy materials. Among durables,
the production of basic metals and parts for consumer
durables decreased, while the output of parts for
equipment grew more slowly. Even so, the output
of durable materials advanced at about a 7 percent
annual rate in the fourth quarter, about the same rate
as in the previous quarter. Among nondurables, the
output of both paper and chemicals increased but
remained at weak levels, while the production of
textiles declined further.
When analyzed by industry group, the data show
that manufacturing output edged up 0.1 percent in
December after a 0.2 percent increase in November;
excluding the initial recovery in aircraft production,
factory output was unchanged in December. For the
fourth quarter, factory output grew 1.7 percent at an
annual rate, compared with a 2.6 percent increase in
the previous quarter; the deceleration was the result
of the drop in the production of aircraft and parts.
The output of durable manufacturing industries rose
132
Federal Reserve Bulletin • February 1996
0.3 percent in December, mainly because of the
increase in aircraft and parts production and further
gains in the output of computing equipment. The
production of nondurable manufacturing was down
again as the output indexes of many major industries
declined or were little changed.
The factory operating rate decreased 0.3 percentage point, to 81.8 percent. Since December 1994,
which was the most recent high, capacity utilization
has fallen 2.9 percentage points. With the December
decline, the utilization rate in the advancedprocessing industries was 80.1 percent—a 2.3 percentage point decrease from December 1994; indus-
trial machinery and equipment, which includes computers, is the only major industry whose current
operating rate is noticeably above the level of a
year ago. The rate in primary-processing industries
decreased 0.3 percentage point in December, to
86.0 percent, and was 4.2 percentage points below its
year-ago level. Outside of manufacturing, the utilization rate in mining was down slightly in December; it
fell sharply for the quarter because of contraction in
the output of coal and in oil and gas extraction. The
operating rate at utilities picked up a little in December; for the quarter, the rate eased just a bit from the
high level of the previous quarter.
•
133
Statement to the Congress
Statement by Alan Greenspan, Chairman, Board of
Governors of the Federal Reserve System, before the
Subcommittee on Financial Institutions and Consumer Credit of the Committee on Banking and
Financial Services, U.S. House of Representatives,
December 5, 1995
I appreciate the opportunity to discuss with you today
the issues raised by the recent events relating to the
U.S. operations of Daiwa Bank and to provide you
with our preliminary conclusions on these issues. As
you requested, my testimony will be presented in two
parts. I will first address the events that culminated in
the issuance of consent orders requiring Daiwa to
terminate its banking operations in the United States.
I will then summarize for you the present system of
supervision of the U.S. offices of foreign banks and
explain a number of initiatives the Federal Reserve
has implemented in this area in the past two years.
EVENTS RELATING
TO DAIWA
BANK
I believe the basic facts surrounding this incident are
fairly well known, but I will briefly summarize the
key events. A more detailed chronology is provided
in an attachment.1 Of course, I would be pleased to
answer, to the extent that I can, any questions that
you might wish to ask regarding these events.
On September 18, 1995, Daiwa Bank met with a
Federal Reserve representative and reported that
Daiwa's New York branch had incurred losses of
$1.1 billion from trading activities undertaken by
Toshihide Iguchi, a branch official, over a period of
eleven years. These losses were not reflected in the
books and records of the bank or in its financial
statements, and their existence was concealed through
liquidations of securities held in the bank's custody
accounts and falsification of its custody records.
Although Daiwa indicates its senior management
learned about these trading losses in July, they
concealed the losses from U.S. banking regulators
for almost two months thereafter. Moreover, they
1. The attachment to this statement is available from Publications
Services, Mail Stop 127, Board of Governors of the Federal Reserve
System, Washington, D C 20551.
directed Mr. Iguchi to continue transactions during
the two-month period that avoided the disclosure of
the losses.
We understand that some officials at the Japanese
Ministry of Finance were informed in early August
about Daiwa's losses. They did not instruct Daiwa to
inform the U.S. authorities; nor did they themselves
do so. This lapse on the part of the Ministry of
Finance is regrettable because open communication
and close cooperation among supervisory authorities
are essential to the maintenance of the integrity of the
international financial system. Finance Minister Takemura has acknowledged the ministry's failure in this
regard and has pledged that in the future the ministry
will promptly and appropriately contact U.S. authorities on such matters of U.S. interest. We have been
assured that the ministry is taking steps to implement
this pledge. In addition, we have been pleased that
once the Daiwa problem was disclosed, the Japanese
authorities have fully cooperated with U.S. supervisors in dealing with the consequences.
On October 9, Daiwa also announced that its separate federally insured bank subsidiary in New York
had incurred losses of approximately $97 million as a
result of trading activities, at least some of them
unauthorized, between 1984 and 1987. These losses
should have been reflected in the books and records
and financial statements of the subsidiary but were
not. Instead, the losses were concealed from federal
and state regulatory authorities through a device that
transferred the losses to offshore affiliates, apparently
with the knowledge of senior management.
On October 2, 1995, the New York Superintendent
of Banks and the Federal Deposit Insurance Corporation (FDIC), together with the Federal Reserve,
issued cease-and-desist orders against Daiwa requiring a virtual cessation of trading activities in the
United States. On November 2, Daiwa was indicted
on federal criminal charges. At the same time, the
Federal Reserve, the FDIC, the New York Superintendent, and a number of other state banking authorities jointly issued consent orders under which Daiwa
must terminate its banking operations in the United
States by February 1996.
This matter has troubling implications for supervision and regulation in a world of multinational
banking and increasing interrelationships of financial
134
Federal Reserve Bulletin • February 1996
systems. Not only were bank employees able to conceal massive losses over an extended period of time,
but senior management of Daiwa also took steps to
conceal the events in question from U.S. regulatory
authorities. This is particularly disturbing given that
it would obviously have been in the best interest of
both the bank and its management to have dealt with
the problems openly and in compliance with host
country regulations and operational standards.
The action taken by the Federal Reserve and the
other regulatory authorities in terminating the U.S.
operations of Daiwa was quite stern, particularly
given that no U.S. depositor or U.S. counterparty
ultimately lost any money. We, however, were united
in the belief that this supervisory response was necessary because actions such as Daiwa's carry the threat
of significant damage to a major asset of our nation—
the integrity of our financial system.
Trust is a principle of central importance to all
effective financial systems. Our system is strong and
vibrant in large part because we demand that financial institutions participating in our markets operate
with integrity and that any information made available to depositors and investors be accurate. When
confidence in the integrity of a financial institution is
shaken or its commitment to the honest conduct of
business is in doubt, public trust erodes and the entire
system is weakened.
The need to trust other participants is essential in a
complex marketplace. For example, on the basis of
trust, counterparties typically trade millions of dollars
on an oral commitment that may not be formalized
for hours. A breach of that trust by failure to honor
such commitments—presumably because markets
turn adverse—would inevitably lead to an institution
being drummed out of the marketplace. No set of
statutes can ensure the effective functioning of a
market if a critical mass of financial counterparties is
deemed untrustworthy. Any risk that counterparties
will not honor their obligations will be reflected in a
widening of bid-ask spreads, a reduction in liquidity,
and, as a consequence, a less efficient financial system. Consequently, actions such as I have recounted
in the Daiwa case cannot be tolerated. The potential
cost to our financial system and hence to our economy is too large.
What is true for the financial system in general is
particularly true for the supervision of financial institutions. Indeed, the whole system of supervision proceeds upon the basis of trust, whether in terms of the
veracity of representations or reports filed by management or transparency with regard to any material
developments affecting the financial condition of the
institution. Supervisors need to trust the ability of
bank management to carry out their duties in a
responsible and honest manner with adherence to
systems and operational controls designed to ensure
the safe and sound conduct of business.
This is not to say that supervision can be based
solely on trust. Supervisors must test a bank and its
management in its compliance with law and sound
business practice. This is, after all, one reason for the
conduct of on-site examinations. An appropriate balance, however, must be struck between a supervisor's
reliance on the institution's systems and management
to function properly and the need to verify that its
systems are being appropriately implemented and
that management is addressing any significant problems. Without reliance on trust, an army of permanent resident examiners would be necessary to ensure
that the operations of a bank are conducted in a
manner that is safe and sound and otherwise consistent with the requirements of law. Such an approach
to supervision clearly would be counterproductive to
the desired support of a vibrant, innovative banking
system. For a supervisor to become a bank's internal
auditor would either stifle the independence of management in the bank or create an unacceptably adversarial supervisory process.
In this context, we have sought to review the
examinations in question in an effort to determine
whether the supervision of Daiwa should have proceeded on a different basis and how such problems,
to the extent feasible, might be avoided in the future.
Accordingly, we have reviewed the steps taken to
implement the authority vested in the Federal Reserve
Board in December 1991 in the Foreign Bank Supervision Enhancement Act (FBSEA) with regard to the
examination and supervision of the operations of
foreign banks in the United States. We have carefully
reviewed the examination reports and other relevant
documents that are presently available to seek to
determine what, if anything, could or should have
been done differently that might have brought to light
the events in question at an earlier date.
A review of the Federal Reserve's three examinations of Daiwa's New York branch in the period
between 1992 and 1994 indicates that the examiners
identified and instructed management to address a
number of internal control weaknesses at the branch.
Specifically, when the examiners learned that a single
person, Mr. Iguchi, was responsible for both securities trading and custody operations and some related
back-office functions, branch management was told
that his duties should be separated. The examiners
explored whether Mr. Iguchi was able to use his
position as overseer of the custody account to gain
improper advantage in carrying out the bank's own
Statement to the Congress
trading activities. The examiners, however, did not
focus on the possibility that this breakdown in internal controls had the potential for the misappropriation of customer and bank funds.
The Federal Reserve accepted statements by
branch management that the basic internal control
problems, which in retrospect helped Mr. Iguchi to
carry out his illegal activities, had been corrected.
Obviously, the examiners and their supervisors did
not at the time believe that employees of Daiwa's
New York branch would be engaged in criminal
activities.
With the benefit of hindsight, there were some
clues that were missed in the examination of Daiwa.
With a more robust follow-up, the problem might
have been found sooner. Our examinations were conducted after the passage of FBSEA in the context of a
rapid buildup of examination staff in 1992 and 1993
to meet our new responsibilities under that act. It is
possible that we had not yet developed adequate
experience to implement our new responsibilities.
The Federal Reserve was still in the process of developing improved examination procedures and assessment systems (including, as I discuss below, an
improved supervisory program, rating system, and
examination manual). This was being done, following enactment of the legislation, to ensure that the
U.S. banking operations of foreign banks are supervised with the same attention to safety and soundness
issues as are the operations of domestic banks. Nonetheless, the bottom line is that we did not succeed in
unearthing Daiwa's transgressions when we might
have. Hopefully, this event will stiffen our resolve.
You have also asked us to discuss whether Daiwa
was subject to comprehensive consolidated supervision in Japan as well as the arrangements between
the U.S. and Japanese banking authorities for sharing
supervisory information. I believe that it is fair to say
that the system of supervision in Japan is detailed and
extensive and requires substantial financial reporting.
As with the U.S. supervisory system, however, false
information provided by a bank or its officers to
supervisors will inevitably hinder the effectiveness of
supervision. In this case, there was clearly a breakdown of internal controls at Daiwa, especially in the
internal audit function, that resulted in an incomplete
picture of Daiwa's overall operations. Moreover, the
regulators in Japan have announced certain measures
that are intended to improve overall supervision of
Japanese banks.
With respect to information sharing, the Basle
Supervisors Committee, beginning in 1975 with the
adoption of the Basle Concordat, established a series
of agreements recognizing the need for cooperation
135
and information sharing among supervisors. When
the committee issued a supplement to the Concordat
in 1990, the Group of Ten countries agreed that
parent authorities should inform host authorities of
supervisory measures that have a significant bearing
on the operations of their banks' foreign establishments. The 1990 supplement stated that parent authorities should be ready to take host authorities into
their confidence when a particular bank faces problems. Consistent with this standard, as I noted earlier,
the ministry has pledged to promptly inform U.S.
authorities in the future of any material information
on matters of U.S. interest.
REGULATION
OF FOREIGN
BANKS
I will now turn to the general issue of how branches
and agencies of foreign banks are supervised in the
United States.
FBSEA, passed by the Congress in December
1991, increased the responsibilities of the Federal
Reserve over the U.S. offices of foreign banks in the
following key ways.
• First, a foreign bank may no longer establish a
state or federally licensed branch or agency without
prior approval from the Federal Reserve.
• Second, FBSEA sets out uniform standards for
approval of such applications, which feature, among
other things, the need for comprehensive, consolidated supervision by the home country authorities
and the adequacy of financial and managerial
resources.
• Third, the Federal Reserve may terminate the
license of a state branch or agency, after appropriate
notice to the licensing state, and may recommend to
the Office of the Comptroller of the Currency the
termination of the license of a federal branch or
agency.
• Fourth, the Federal Reserve was given full
examination authority over branches and agencies.
• Finally, each such office is required to be examined at least once during each twelve-month period,
with coordination as appropriate among the other
relevant federal and state supervisory authorities.
Commencing in 1992, the Federal Reserve took a
number of steps, which I describe further below, to
implement its expanded authority in this area and
improve the supervision of the U.S. offices of foreign
banks. As indicated by these initiatives, the Federal
Reserve recognized early in the process that increasing emphasis was required to be placed on the assess-
136
Federal Reserve Bulletin • February 1996
ment of the adequacy of risk management systems
and internal controls of foreign banks. Many of the
improvements focus in particular on these areas.
To fulfill its expanded role under FBSEA over the
U.S. offices of foreign banks, the Federal Reserve has
significantly increased the number of staff members
dedicated to examining and monitoring the activities
of these offices. Federal Reserve examiners devoted
primarily to the examination of U.S. offices of foreign
banks now number 252, up from 106 in 1991. The
total number of examination and other professional
supervisory staff dedicated to supervision of these
activities has increased from 119 in 1991 to 288
currently.
While internal controls have long been a focus of
examinations, the growth in bank trading activities in
the early 1990s also led to Federal Reserve initiatives
to enhance its examination of trading activities. A
number of these examination procedures address the
need to have a proper separation of duties between
the front office and back office, as well as effective
audit procedures.
In the aftermath of Barings and Daiwa, our supervisory sensitivities have been heightened to the
potential magnitude of the risks associated with a
combination of trading and back-office functions.
Barings confirmed the importance of the increasing
emphasis the Federal Reserve's supervisory staff had
been placing on the review of foreign banks' internal
controls and risk management systems. The circumstances of the Daiwa case reinforce the need to pay
close attention to these areas during examinations
and to take heed of potential red flags that might
suggest the possibility of rogue employees or a breakdown of internal controls. Both cases demonstrate the
need, once serious deficiencies in internal controls
are identified, to ensure that relevant books and
records are reconciled and verified in an expeditious
and thorough manner. This is true in the domestic, as
well as the foreign, banking context. Careful attention to controls can reduce the potential for fraud
such as occurred in the Daiwa case, although such
potential can never be fully eliminated.
In the past two years, the Federal Reserve has
implemented a number of initiatives that address
these concerns. The Federal Reserve, together with
the state banking departments and other federal regulators, has worked to coordinate better and enhance
further the supervision of the U.S. activities of foreign banks. To that end, we have developed a new
supervisory program for the U.S. operations of foreign banks. One important aspect of this program is
to ensure that the information available to the U.S.
supervisors is utilized and disseminated in a logical,
uniform, and timely manner. The program was formally adopted earlier this year, and the implementation phase is now under way.
The new supervisory program also emphasizes
enhanced contacts between U.S. supervisors and the
home country supervisors of foreign banks. This case
and the effect that it has had on Daiwa's activities,
both in the United States and abroad, illustrate that
problems of a bank in one market ultimately will
affect its operations globally, including in its home
country. In the end, there will be a mutuality of
interest between home and host country supervisors,
which underscores the need for effective communication and increased cooperation. In this regard,
although there were delays in the disclosure of
Daiwa's problems to the U.S. authorities, once the
matter was disclosed there was effective cooperation
among U.S. and Japanese regulatory authorities in
dealing with the consequences in an orderly manner that avoided losses to customers and systemic
disruption.
I believe that, like ourselves, supervisors throughout the world recognize that more needs to be done to
ensure better coordination and timely communication
of material information. The Basle Committee on
Banking Supervision has emphasized the importance
of such international cooperation through issuance of
international standards for supervision of multinational banking organizations and is discussing
ways to broaden further and strengthen lines of communication. We will support those efforts and will
continue our own initiatives to improve communication with foreign supervisors under the new supervisory program.
The Federal Reserve has also committed extensive
resources over the past few years to enhancing the
supervisory tools available to examiners and financial
analysts to improve further our supervision of the
U.S. operations of foreign banks. In 1994, the federal
and state banking supervisory agencies adopted a
new uniform examination rating system for U.S.
branches and agencies of foreign banks that places
higher priority on the effectiveness of risk management processes and operational controls. The new
rating system, commonly referred to as the ROCA
system, focuses on the following elements: risk management, operational controls, compliance with U.S.
laws and regulations, and asset quality. The first three
of these components evaluate the major activities or
processes of a branch or agency that may raise supervisory concerns. The ROCA system will direct examiners' attention to the combination of front- and backoffice duties, such as occurred in Daiwa, as a
significant flaw in internal controls. We believe that
Statement to the Congress
the ROCA system focuses more clearly on the important areas of a foreign bank's U.S. operations than
would the previous AIM (asset quality, internal control, and management) system.
Another new supervisory tool is the Examination
Manual for the U.S. Branches and Agencies of Foreign Banking Organizations. The Federal Reserve, in
cooperation with state and other federal banking
agencies, has developed the manual for conducting
individual examinations of the U.S. branches and
agencies of foreign banks. The manual serves as a
primary, comprehensive reference source for examination guidelines and procedures and is beneficial to
both new and experienced examiners. The manual is
also being widely used as a reference tool by the
foreign banking community in the United States to
improve its own internal systems of controls.
In addition, in 1994, the Federal Reserve adopted a
new Trading Activities Manual. Although the manual
has been developed primarily for U.S. commercial
banks, it also applies to the U.S. branches and agencies of foreign banks, many of which are actively
engaged in transactions involving trading activities.
This manual includes detailed examination procedures for evaluating controls in trading activities and
emphasizes the importance of separation of duties in
a trading operation such as Daiwa's.
The Federal Reserve has also taken steps to
enhance the training of examiners. For example, we
have developed an internal controls school that was
designed initially for examiners of branches and
agencies of foreign banks and expanded to meet the
needs of other examiners. We are also initiating a
comprehensive capital markets examiner training
program covering risk assessment, trading exposure
management, and advanced derivative products. This
program addresses skill needs at a variety of levels
and utilizes instructors from the financial sector to
supply expertise to train our examiners in these specialized areas.
Even given the new supervisory program and tools
as well as our heightened sensitivity to possible red
flags, no system of supervision will uncover all fraud.
As the Board stated in 1991 in support of FBSEA,
fraud is very hard for any regulatory authority to
detect, especially when bank employees actively conspire to prevent official scrutiny. But if, after the
fraud is discovered, swift and stern corrective action
is taken by the supervisory authorities, financial institutions hopefully will recognize that deception pays
no dividend. FBSEA legislation was designed to
minimize the potential for illegal activities by establishing uniform standards for entry by foreign banks
and, if illegal activities are suspected, to provide as
137
many regulatory and supervisory tools as possible to
investigate and enforce compliance. The Daiwa matter illustrates that the 1991 legislation provided the
appropriate remedial tools to address serious failures
to comply with law and regulation.
I believe that there are valuable lessons to be
learned by bankers and supervisors from this unfortunate case. The loss of more than $1 billion suffered
by Daiwa and the catastrophic losses suffered by
Barings in Singapore because of a rogue trader illustrate the enormity of the damage that can be incurred
by global trading banks when internal control systems are less than adequate. These losses and the
institutional injury incurred are far greater than the
losses banks have encountered from their authorized
proprietary risk-taking positions. The lesson forcefully taught by these cases is that management must
pay as much attention to such seemingly mundane
tasks as back-office settlement and internal audit
functions as to the more exotic high-technology frontend trading systems. Banks that neglect making the
requisite investments in these areas do so at their
peril. While the adequacy of internal controls has
long been a point of major emphasis of supervisors,
these recent events reinforce the need for supervisors
to pursue rigorously the expeditious correction of
internal control deficiencies in financial institutions.
Moreover, in an era of mergers and aggressive cost
control, supervisors must clearly emphasize to bank
officials that key control and processing areas in
banks must remain fully staffed by competent and
experienced personnel.
Looking more broadly at the supervisory system
and its functions within the international banking
system, I would like to conclude by discussing a few
general points that are raised by this case. No supervisory system can, nor should endeavor to, stop all
losses. Any system that attempted to be fail-safe
would impose intolerable costs on the public and the
banking industry and almost certainly would stifle
legitimate financial innovation. Moreover, in any
supervisory regime, the ultimate responsibility for the
protection of a privately owned bank must rest with
the top management of the bank and its directors.
After all, it is in their long-term interest to operate the
bank in a safe and sound manner and to obey the law.
Supervisors must, to some extent, rely on this mutuality of interest in performing their tasks. While good
examiners are not naive and do not expect bankers to
bare their souls, normally they must rely on a basic
trust that they will not be deceived as they raise
issues through successive layers of management. An
assumption that most bankers are truthful should
remain the rule, not the exception. However, when a
138
Federal Reserve Bulletin • February 1996
bank has shown through repeated actions that it cannot be trusted, even at the highest levels of the
corporation, supervisors should resort to extraordinary regulatory measures.
In such circumstances, the Congress has provided
the supervisors with what I believe to be a full and
appropriate range of powers, including cease-anddesist authority, civil money penalties, and, in the
case of foreign banks, the authority to terminate their
U.S. operations. This episode demonstrates that the
supervisors will use these powers when, through a
pattern of unacceptable behavior, the basic bond of
trust that needs to exist between banks and their
regulators is irreparably broken. However, if our further review of the events in question suggests additional authority is needed, we will of course convey
that view to this committee.
We are considering a number of initiatives that
may be implemented at an administrative level, espe-
cially with respect to internal and external audit
standards. For example, we are presently reviewing
our general policies in this area to determine the
extent to which more specific guidance can be given
to examiners for purposes of evaluating the adequacy
of audit coverage. Consideration will also be given to
requiring targeted external audits in banking institutions, whether foreign or domestic, when deficiencies
in operations or concerns over the adequacy of internal audit have not been addressed.
Clearly, we also need to fully implement our
enhanced supervisory program in an expeditious
manner. In doing so, the Federal Reserve will be
reviewing the Daiwa case, Barings, and other major
international banking events to identify further specific improvements to the supervisory process as it
applies to both foreign and U.S. banks, as well as our
existing statutory authority. We will report to the
Congress on the conclusions of our review.
•
139
Announcements
ALAN S. BLINDER TO STEP DOWN AS
VICE CHAIRMAN OF THE BOARD OF GOVERNORS
Alan S. Blinder, Vice Chairman of the Federal
Reserve Board, announced on January 17, 1996, that
he would not continue in his position beyond the
expiration date of his term on January 31.
Following is the text of a statement issued by the
Vice Chairman:
Yesterday, I informed President Clinton that I have
decided not to seek renomination to another term as a
member of the Board of Governors of the Federal Reserve
System. I will, instead, return to teaching at Princeton
University next month.
When I accepted nomination to the Vice Chairmanship
in 1994,1 knew that my term as Governor ran only through
January 31, 1996. My idea at the time was to serve out the
balance of the term—marking three years away from
Princeton—and then return to the University. Since then, I
have had many occasions and reasons to question this
tentative decision. But, in the end, a variety of personal
considerations pushed me back toward my original plan.
It was, frankly, an extremely difficult career choice,
between two finely balanced alternatives. And I leave with
some regrets, for I continue to believe deeply in the idea of
public service. The opportunity to serve the public at this
level comes rarely and is reserved for few. I shall always
be grateful to President Clinton for granting me that
privilege.
both on your Council of Economic Advisers and as Vice
Chairman of the Federal Reserve System; and I hope
I have made some small contribution to the success of
both. I will always be grateful to you for giving me these
two rare opportunities to serve my country.
That public service remains a high calling bears emphasis these days, when the work of government is under
unceasing attack. During my three years in Washington, I
have come to know many individuals—both political
appointees and career civil servants, both in the Administration and at the Fed—who work harder under much more
difficult conditions for far less money than they could earn
in the private sector. They do it because they believe, as I
do, in the idea of public service. A nation that routinely
denigrates its public servants, and makes public service as
unpleasant as possible, may soon find itself with the kind
of government it has tacitly asked for. It pains me to think
that my own country may be becoming such a nation.
Finally, it has been a rare privilege to get to know Mrs.
Clinton and you. It's an association that Madeline and I
will always treasure. And I thank you most sincerely for
that, too.
Yours very truly,
Alan
cc: The Vice President
Laura Tyson, National Economic Council
Chairman Alan Greenspan issued the following
statement:
The text of Vice Chairman Blinder's letter to
President Clinton f o l l o w s :
January 16, 1996
President William J. Clinton
The White House
Washington, D.C.
It has been a privilege to have worked with Alan Blinder
during his all-too-short tenure as Vice Chairman of the
Federal Reserve Board. Dr. Blinder's economic perceptions and analysis have been of utmost value to the Board.
They will be missed, as will he. The Vice Chairman has
been a trusted colleague and personal friend. I wish him
well.
Dear Mr. President:
It is with a somewhat heavy heart that I write to inform
you that I do not wish to continue on the Board of Governors of the Federal Reserve System beyond the expiration
of my term on January 31st. I found this decision extremely
difficult and wrestled with it for a long time. In the end,
however, a variety of personal factors overcame the strong
pull of public service.
I imagine that most people leave government with some
regrets. So do I, for there are certainly things I could have
done better and, of course, there is much more to be done.
But I nonetheless look back with some pride on my service
ACTION BY THE FEDERAL
COMMITTEE
OPEN
MARKET
Chairman Alan Greenspan announced on December 19, 1995, that the Federal Open Market Committee had decided to decrease slightly the degree of
pressure on reserve positions.
Since the last easing of monetary policy in July,
inflation has been somewhat more favorable than
anticipated, and this result along with an associated
140
Federal Reserve Bulletin • February 1996
moderation in inflation expectations warrants a modest easing in monetary conditions.
This action is expected to be reflected in a decline
in the federal funds rate of 25 basis points, from
about 53A percent to about 5V2 percent.
PRESS STATEMENT AND COMMUNIQUE
BASLE COMMITTEE
BY THE
The Federal Reserve Board issued on December 12,
1995, a press statement and communique by the
Basle Committee on Banking Supervision to amend
the Basle Capital Accord of July 1988 to take account
of market risk. Copies of the statement and communique are available on request from Publications Services, Board of Governors of the Federal Reserve
System, Mail Stop 127, Washington, DC 20551.
REGULATION
C: STAFF
COMMENTARY
The Federal Reserve Board published on December 6, 1995, a staff commentary to its Regulation C
(Home Mortgage Disclosure) that interprets the
requirements of the regulation.
The commentary provides guidance on issues such
as the treatment of prequalifications, loan applications received through a broker, participations, refinancings, home equity lines of credit, and mergers.
The Board believes that the commentary will help
reduce burden and ease compliance by clarifying
application of the rules, providing flexibility in compliance, and consolidating the guidance that is currently available from a variety of sources.
Compliance is mandatory for collection of data
that begins January 1, 1996, which is to be submitted
to supervisory agencies no later than March 1, 1997.
REGULATION
K: FINAL
RULE
The Federal Reserve Board issued on December 22,
1995, a final rule amending its Regulation K (International Operations of U.S. Banking Operations) to ease
the burden on U.S. banking organizations seeking to
make investments in foreign companies. The final
rule was effective immediately.
The final rule, which is part of an overall review
of the entire regulation, expands the authority of
strongly capitalized and well-managed banking
organizations to make certain foreign investments.
No prior notice or application to the Board will be
required before an organization makes an investment
that falls within this revised general consent author-
ity. The final rule also streamlines the review procedures for notices and applications.
PROPOSED
ACTIONS
The Federal Reserve Board on December 20, 1995,
requested comment on a proposed one-time Check
Fraud Survey. The survey will help the Federal
Reserve fulfill the congressional mandate to report on
the advisability of modifying the Expedited Funds
Availability Act to extend the maximum permissible
hold period for local checks as a means of decreasing losses related to check fraud. Comments were
requested by February 20, 1996.
The Federal Reser/e Board on December 22, 1995,
published for public comment proposed revisions to
its staff commentary to Regulation B (Equal Credit
Opportunity). Comments were requested by February 28, 1996.
The Federal Reserve Board on December 22, 1995,
issued for public comment proposed changes to the
provisions of the Board's Regulation K regarding
interstate banking operations of foreign banking organizations. Comments were requested by February 5,
1996.
The Federal Reserve Board on December 11, 1995,
extended to February 15, 1995, the comment period
on proposed amendments to its Regulation M (Consumer Leasing), which carries out provisions of the
Consumer Leasing Act.
The Federal Reserve Board on December 7, 1995,
issued for public comment proposed amendments to
its Regulation U (Credit by Banks for Purchasing or
Carrying Margin Stocks). Comments were requested
by February 15, 1996.
The Federal Reserve Board on December 1, 1995,
issued for public comment proposed revisions to the
official staff commentary to its Regulation Z (Truth in
Lending). Comments were requested by February 2,
1996.
The Federal Reserve Board on December 1, 1995,
published for public comment proposed revisions to
the official staff commentary to its Regulation DD
(Truth in Savings). The commentary applies and
interprets the requirements of the regulation. Comments were requested by February 2, 1996.
VIDEOTAPE ON THE HOME BUYING
Now AVAILABLE
PROCESS
The Federal Reserve Board on December 14, 1995,
announced the availability of a new educational video-
Announcements
tape on the home buying process entitled "Both
Borrower and Lender."
The program is designed for first-time homebuyers
and is divided into four segments:
•
•
•
•
Financial preparedness
Types and terms of mortgages
The mortgage application process
Settlement and closing.
The entire program is approximately two hours
long with each segment about thirty minutes in
length. The videotape is a byproduct of the Board's
recent distance learning program, which was broadcast nationwide via satellite.
The videotape was aired on the American Bankers
Association (ABA) satellite network, American
Financial Skylink, on January 30, 1996. For more
information on Skylink, please call ABA's John
Cavanaugh at (202) 663-5116. The video is available
for purchase from VIDICOPY. Single or bulk copies
of the entire program may be purchased at the following rates:
1-30 copies @ $12.95, includes shipping
31-99 copies @ $11.45, includes shipping.
For additional information, write VIDICOPY at
650 Vaqueros Avenue, Sunnyvale, CA 94086 or call
1-800-708-7080.
141
includes the incorporation of SEER and CAMEL
ratings, and revised capital adequacy guidelines. The
capital adequacy guidelines no longer distinguish
between originated and purchased mortgageservicing rights. The guidelines contain new conversion factors for certain derivative contracts, recognize
certain netting arrangements in calculating credit exposure on such contracts, and impose lower capital
requirements for retained recourse for small business
loans and leases on personal property than are required for other assets sold with recourse.
Other sections emphasize the responsibilities of
holding companies to oversee the activities of their
depository institution subsidiaries. They include
(1) examiner guidance regarding the evaluation of the
overall allowance for loan and lease losses and the
use of accounting standards (SFAS 114 and 118) for
estimating impaired loans for financial reporting
purposes, and (2) a clarification of the February 17,
1994, "Interagency Statement on Retail Sales of
Nondeposit Investment Products." A complete list of
changes to the Manual is contained in the update
package.
The Manual and the updates are available to the
public and may be obtained from Publications Services, Mail Stop 127, Board of Governors of the
Federal Reserve System, Washington, DC 20551.
Copies of the Manual, updated through December
1995, are available at a cost of $104.00. To be added
to the mailing list to receive updates for 1996, please
send an additional $20.00.
PUBLICATION OF THE DECEMBER 1995 UPDATE
TO THE BANK HOLDING
SUPERVISION
MANUAL
COMPANY
The December 1995 update of the Bank Holding
Company Supervision Manual has been published.
The update includes a revised discussion of the System's BHC Surveillance Program, which, in turn,
CHANGE IN BOARD
STAFF
The Board of Governors announced that Frederick
M. Struble, Associate Director, Division of Banking
Supervision and Regulation, retired, effective January 31, 1996.
•
142
Minutes of the
Federal Open Market Committee Meeting
Held on November 15,1995
A meeting of the Federal Open Market Committee
was held in the offices of the Board of Governors of
the Federal Reserve System in Washington, D.C., on
Wednesday, November 15, 1995, at 9:00 a.m.
Present:
Mr. Greenspan, Chairman
Mr. McDonough, Vice Chairman
Mr. Blinder
Mr. Hoenig
Mr. Kelley
Mr. Lindsey
Mr. Melzer
Ms. Minehan
Mr. Moskow
Ms. Phillips
Ms. Yellen
Messrs. Boehne, Jordan, McTeer, and Stern,
Alternate Members of the Federal Open
Market Committee
Messrs. Broaddus, Forrestal, and Parry, Presidents
of the Federal Reserve Banks of Richmond,
Atlanta, and San Francisco respectively
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Kohn, Secretary and Economist
Bernard, Deputy Secretary
Coyne, Assistant Secretary
Gillum, Assistant Secretary
Mattingly, General Counsel
Baxter, Assistant General Counsel
Prell, Economist
Truman, Economist
Messrs. Davis, Hunter, Lindsey, Mishkin, Promisel,
Siegman, Slifman, and Stockton, Associate
Economists
Mr. Fisher, Manager, System Open Market Account
Mr. Winn, Assistant to the Board, Office of Board
Members, Board of Governors
Mr. Ettin, Deputy Director, Division of Research and
Statistics, Board of Governors
Mr. Madigan, Associate Director, Division of
Monetary Affairs, Board of Governors
Mr. Simpson, Associate Director, Division of
Research and Statistics, Board of Governors
Mr. Reinhart, 1 Assistant Director, Division of
Monetary Affairs, Board of Governors
Mr. Ramm, 1 Section Chief, Division of Research
and Statistics, Board of Governors
Ms. Low, Open Market Secretariat Assistant,
Division of Monetary Affairs, Board of
Governors
Messrs. Beebe, Goodfriend, Lang, Rolnick, and
Rosenblum, Senior Vice Presidents, Federal
Reserve Banks of San Francisco, Richmond,
Philadelphia, Minneapolis, and Dallas
respectively
Messrs. Gavin and Kopcke, Mses. Krieger and
Rosenbaum, Vice Presidents, Federal Reserve
Banks of St. Louis, Boston, New York, and
Atlanta respectively
Mr. Stevens, Consultant, Federal Reserve Bank
of Cleveland
B y unanimous vote, the minutes of the meeting of
the Federal Open Market Committee held on September 26, 1995, were approved.
The Manager of the System Open Market Account
reported on recent developments in foreign exchange
markets and on System foreign currency transactions
during the period September 26, 1995, through
November 14, 1995. B y unanimous vote, the Committee ratified these transactions.
The Manager also reported on developments in
domestic financial markets and on System open market transactions in government securities and federal
agency obligations during the period September 26,
1995, through November 14, 1995. B y unanimous
vote, the Committee ratified these transactions.
By unanimous vote, the Committee authorized the
renewal for an additional one-year period of the
System's reciprocal currency ("swap") arrangements
with foreign central banks and the Bank for International Settlements that were due to mature on various
dates in December 1995. The renewal encompassed
all the System's swap arrangements except that with
1. Did not attend portion of meeting covering the monetary policy
discussion.
143
the Bank of Mexico, which is scheduled to mature on
January 31, 1996, and will be considered at a later
meeting. The amounts and maturity dates of the
arrangements approved for renewal are shown in the
table that follows:
Foreign bank
Austrian National Bank
Bank of England
Bank of Japan
Bank of Norway
Bank of Sweden
Swiss National Bank
Amount of
arrangement
(millions of
dollars
equivalent)
250
3,000
5,000
250
300
4,000
Term
(months)
Maturity
date
12
12/04/95
12/04/95
12/04/95
12/04/95
12/04/95
12/04/95
Bank for International
Settlements:
Swiss francs
Other authorized European
currencies
600
12/04/95
1,250
12/04/95
National Bank of Belgium
Bank of Canada
National Bank of Denmark . . .
Bank of France
German Federal Bank
Bank of Italy
Netherlands Bank
1,000
2,000
250
2,000
6,000
3,000
500
12/18/95
12/28/95
12/28/95
12/28/95
12/28/95
12/28/95
12/28/95
The Committee then turned to a discussion of the
economic and financial outlook and the implementation of monetary policy over the intermeeting period
ahead. A summary of the economic and financial
information available at the time of the meeting and
of the Committee's discussion is provided below,
followed by the domestic policy directive that was
approved by the Committee and issued to the Federal
Reserve Bank of New York.
The information available at the time of the meeting was mixed, but on balance it suggested a more
moderate rate of expansion of economic activity after
a strong gain during the summer. Consumer spending
had turned sluggish recently; but with order backlogs
still large, business spending for durable equipment
was continuing at a robust if somewhat less rapid
rate, and the sizable rise in housing starts in the third
quarter presaged higher residential construction outlays. Appreciable increases in employment and hours
worked tended to confirm that the economy had
continued to expand at a solid pace, although manufacturing activity had weakened a little. Consumer
and producer prices had risen more slowly on average in recent months after having increased at elevated rates in the early part of the year, and growth in
labor costs had slowed further.
Nonfarm payroll employment, though held down
somewhat by the onset of a labor strike in the aircraft
industry, increased in October at the average monthly
pace of the third quarter; in addition, aggregate hours
worked by private production workers rose appreciably further. Construction payrolls recorded another
sizable advance. The rate of job growth in the
services industry slowed a little further, reflecting a
decline in employment in personnel supply services
after two months of strong advances. Manufacturing
employment declined again. The civilian unemployment rate edged down in October to 5.5 percent.
Industrial production fell somewhat in October
after having risen appreciably in the third quarter;
most of the loss reflected the strike in the aircraft
industry, but motor vehicle production and mining
output also recorded substantial declines. In contrast,
production of information processing equipment
continued to rise at a rapid pace. Total utilization
of industrial capacity contracted in October, with
declines widespread across industries.
Total nominal retail sales, which had expanded
relatively briskly over the second and third quarters,
fell in October. As part of a pattern of widespread
weakness in October, purchases at furniture and
appliance stores were down appreciably after large
gains in earlier months, and sales at general merchandise and apparel outlets reversed most of their sizable
September increases. Housing demand and construction activity firmed in the third quarter: Sales of both
new and existing homes posted solid advances, and
single-family housing starts rose considerably, though
multifamily starts remained sluggish.
Business investment in both equipment and structures expanded less rapidly in the third quarter.
Stepped-up shipments of nondefense capital goods in
August and September more than offset a sharp drop
in shipments in July, but the quarterly average gain
was significantly smaller than the increases recorded
in the previous two quarters. Although orders for
nondefense capital goods also rose more slowly in
the third quarter, the still-sizable order backlogs
pointed to substantial expansion of spending on business equipment in the near term. Nonresidential construction increased appreciably further in the third
quarter, reflecting a surge in office and institutional
building activity.
Available data suggested a reduction in business
inventory accumulation in August and September. In
manufacturing, the pace of stockbuilding slowed in
the third quarter from the brisk rate of the first half of
the year, leaving the factory stock-shipments ratio
unchanged in the third quarter and a little above
historic lows. In the wholesale sector, inventories
were drawn down in August and September after
sizable buildups in earlier months; with sales weak,
the aggregate inventory-sales ratio for the sector
edged up in the third quarter and was at the upper end
144
Federal Reserve Bulletin • February 1996
of its range for recent years. Retail inventories
expanded significantly in August (latest data available), but the stockbuilding was generally in line with
sales and the ratio of inventories to sales remained
near the middle of its range in recent years.
The nominal deficit on U.S. trade in goods and
services narrowed markedly in August; for July and
August combined, the deficit was significantly
smaller than its average rate in the second quarter.
The value of exports declined over the two-month
period, with increases in exports of computers and
agricultural products more than offset by decreases in
exports of aircraft, gold, and service receipts. Imports
fell more than exports; with the notable exception
of computers and semiconductors, declines were
recorded in most major import categories. Available
data indicated that economic expansion remained
subdued in the major foreign industrial countries.
Growth continued to slow in the European economies
other than Italy, and the Japanese economy showed
little evidence of a sustained recovery.
Consumer prices rose at a slightly faster rate in
October; with a smaller increase in food prices offsetting higher energy prices, the index for items other
than food and energy also picked up a little. For the
four months ending in October, prices for nonfood,
non-energy items advanced at a rate well below that
of earlier in the year. Producer prices of finished
goods edged down in October, reflecting a further
decline in the prices of finished energy goods.
Excluding food and energy, producer prices were
unchanged in October and increased at a slower pace
in the third quarter than in the first half of the year.
Growth in total nominal hourly compensation of private industry workers slowed in the third quarter and,
on a year-over-year basis, continued to trend down;
the decrease in compensation growth over the past
year spanned most major occupations and industries.
At its meeting on September 26, 1995, the Committee adopted a directive that called for maintaining
the existing degree of pressure on reserve positions
and that did not include a presumption about the
likely direction of any adjustments to policy during
the intermeeting period. The directive stated 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 or slightly lesser reserve restraint
would be acceptable during the intermeeting period.
The reserve conditions associated with this directive
were expected to be consistent with growth of M2
and M3 over the balance of the year at a pace near
that experienced in recent months.
Open market operations were directed toward
maintaining the existing degree of pressure on reserve positions throughout the intermeeting period.
The federal funds rate averaged close to 53A percent,
apart from a temporary rise around the end of the
third quarter. Other short-term market rates also
changed little on balance; market participants continued to anticipate an easing of monetary policy at
some point but apparently viewed the chances of
near-term easing as small. Longer-term interest rates
declined further over the intermeeting period, perhaps in response to a growing conviction that inflation pressures would remain subdued and that substantial reductions in fiscal deficits would be achieved
over a period of years. The lower longer-term interest
rates, coupled with continuing reports of strong corporate earnings, helped lift major indexes of equity
prices to new record levels during the period. In
foreign exchange markets, the trade-weighted value
of the dollar in terms of the other G-10 currencies
declined slightly over the intermeeting period.
Expansion of the broad monetary aggregates weakened in October. M2 was unchanged in October after
having grown relatively rapidly in the third quarter
and despite the persistence of low opportunity costs
associated with holding M2 assets. For the year
through October, M2 expanded at a rate in the upper
half of the Committee's range for this aggregate in
1995. Growth of M3 apparently was held down
somewhat by the reduced need for additional bank
funding during a time of sluggish loan demand; for
the year to date, M3 grew at a rate a little above its
range. Total domestic nonfinancial debt had risen
more slowly in recent months, reflecting reduced
expansion of both private and federal borrowing.
Nonetheless, for the year to date, this measure of debt
remained around the midpoint of its monitoring
range.
The staff forecast prepared for this meeting suggested that the growth of economic activity would
slow from the strong third-quarter pace to a rate more
in line with the increase in the economy's potential.
The forecast assumed that the favorable interest rate
and wealth effects of the extended rally in the debt
and equity markets would provide support for a moderate advance in final sales. Consumer spending was
expected to expand at a rate generally in line with the
growth of incomes; the favorable effects of higher
prices on financial assets held by households would
be offset to some extent by the difficulties of increasing numbers of households in servicing their growing
debts. The greater affordability of housing stemming
from the earlier decline in mortgage rates was projected to help sustain homebuilding activity at a
Minutes of the Federal Open Market Committee
relatively high level. In anticipation of reduced
growth in sales and profits, business investment in
new equipment and structures was projected to slow
appreciably from the very rapid pace of the past few
years. Strong export expansion would be associated
with the improving outlook for the economies of
major trading partners. Although substantial uncertainty still surrounded the fiscal outlook, the forecast
continued to incorporate a considerable degree of
fiscal restraint. In the staff's judgment, wage and
price inflation likely would not deviate significantly
from recent levels.
In the Committee's discussion, members commented that recent statistical and anecdotal information pointed on balance to an appreciable slowing in
the economic expansion, which had displayed unexpected strength during the summer months. There
was some mix of views among the members concerning how far the slowing might proceed, though they
generally viewed moderate growth as the most likely
course for the economy. A number of members
believed that growth around potential was a probable
outcome, with business activity sustained in part by
the favorable developments this year in the bond and
stock markets. Other members expressed concern
about some signs of further ebbing in the strength of
final demands, and they envisaged the possible need
for a policy adjustment at some point to sustain
continued moderate growth. With regard to inflation,
members noted that despite generally high levels of
resource use, including tight labor markets in many
parts of the country, inflation had been more subdued
than many had expected over the past several months.
A number of members commented that they saw a
basis in this development for mild optimism about
the outlook for inflation, but others expressed concern that, in the context of current forecasts for
economic activity and relatively high levels of
resource use, progress toward lower inflation was
unlikely over the projection period and indeed there
was a risk of some modest deterioration in price
performance.
In the course of the Committee's discussion, members reported on uneven business conditions in different parts of the country and among industries. On
balance, modest to moderate growth appeared to
characterize most regions, with overall levels of
activity ranging from relatively robust in some
regions to comparatively depressed in others. The
mixed conditions were especially notable in manufacturing where numerous producers faced lagging
demands while others, particularly in high-tech industries, found it difficult to satisfy strong demands for
their products. More generally, the industrial sector
145
of the economy had tended to stagnate for some time,
including a slight decline in manufacturing activity
reported for October, but recent improvement in
orders for steel was cited as a favorable if not decisive omen in the outlook for industrial production. In
other sectors of the economy, members observed that
tourism displayed considerable strength in many
areas, while cattle operations and energy production
were adversely affected by high production costs or
low prices.
In their review of developments in key demand
sectors of the economy, members observed that consumer spending appeared to be on a firm growth
trend, though weakness in overall sales of motor
vehicles in recent months and a decline in total retail
sales in October had introduced a cautionary note. It
was suggested that the performance of retail sales
during the holiday season would tend to set the tone
for the longer-term trend in such sales, and in this
respect available data and anecdotal reports covering
the first part of November were somewhat promising.
More generally, further growth in consumer spending, though probably at a somewhat slower pace than
over the past year, appeared likely. Such growth
would be supported by moderate expansion in
incomes and by the favorable effects on household
wealth and confidence of the substantial improvement in the value of financial assets this year and the
ready availability of financing on relatively attractive
terms. Consumer confidence currently seemed to be
at a fairly high level, albeit not uniformly so across
the country, and at least for the quarters immediately
ahead, anticipated strength in homebuilding should
induce spending for many household durables. On
the negative side, some members emphasized that
the growth in consumer debt was likely to exert an
increasingly inhibiting effect on consumer spending.
Moreover, the satisfaction of earlier pent-up demands
might well limit sales of many consumer durables,
notably motor vehicles, in coming quarters. In one
view, the projected growth in personal incomes and
the increases that had occurred this year in the value
of household holdings of financial assets would provide relatively little stimulus to consumer spending
because the distribution of such gains was heavily
tilted toward consumers in higher income or older
age groups.
Further sizable growth in business fixed investment, but at a pace well below that experienced in
recent years, was expected to provide appreciable
impetus to the expansion over the next several quarters. Favorable factors in the outlook for business
capital spending included a desire to upgrade technological capabilities for competitive reasons, strong
146
Federal Reserve Bulletin • February 1996
business earnings and cash flows, and an ample availability of financing on relatively liberal terms. Declining office vacancy rates in a number of areas would
help to support office construction, and several members also commented on the strength in commercial
and other nonresidential building activity in various
parts of the country.
Ongoing efforts by many business firms to bring
inventories into better alignment with sales had
resulted in declining inventory investment since earlier in the year. Some further inventory adjustments,
notably in stocks of motor vehicles, were expected
over coming months, though not at a pace that would
have a marked retarding effect on economic activity.
Over much of 1996, inventory investment was projected to be a more neutral factor in the economy,
with accumulation proceeding at a pace in line with
growth in final sales, but the risks of unexpected
developments in this sector of the economy were
always substantial.
The outlook for fiscal policy remained obscured by
the uncertain outcome of the current debate between
the Congress and the Administration. While substantial fiscal restraint aimed at eventually balancing the
budget appeared to be the likely result, the timing of
the implementation of various tax and expenditure
initiatives and the resulting extent of the fiscal
restraint over the forecast period could not be anticipated with any degree of precision. For the nearer
term, the ongoing shutdown of much of the federal
government presented a downside risk to the expansion whose effects would depend on the presently
uncertain duration of the shutdown and the potential
unsettlement in financial markets that might develop
at some point. The members generally believed, however, that in light of the underlying strength of the
economy, the retarding effects of likely federal budget developments would not be sufficient in themselves to arrest the expansion over the forecast
period, at least if the federal government shutdown
were of relatively short duration and a federal debt
default were averted.
The nation's foreign trade deficit had worsened
substantially during the past several years, but current forecasts did not point to further deterioration
over the projection period. An anticipated firming in
the economies of major U.S. trading partners was
expected to bolster exports. Several members questioned, however, the extent to which forecasts of
strengthening economic activity were likely to materialize in a number of these countries, and they suggested that the foreign sector might well remain a
somewhat constraining factor in the performance of
the domestic economy.
Members welcomed the generally favorable price
and cost developments of recent months and the
related indications that currently high levels of
resource use did not appear to be associated with
rising inflationary pressures. Many emphasized the
persistence of subdued increases in labor costs, and a
number provided supporting anecdotal indications of
relatively small advances in labor compensation in
many parts of the country despite tight labor markets.
The anecdotal reports also continued to suggest that
strong competition was holding down price inflation
and that producers were benefiting from soft prices of
industrial materials. While a number of members
believed that these developments might augur a modest decline in inflation over the year ahead, given
current forecasts of moderate economic expansion,
many viewed as more likely the prospect of little or
no progress toward price stability over coming quarters, and some expressed concern about the potential
for an upward drift in the rate of inflation. An underlying factor in the relatively favorable climate for
inflation was the continued limited rise in the costs of
worker benefits. In the view of some members, however, benefit costs were likely to be less well contained as time went on and further major gains in
curbing such costs became more difficult to achieve.
Moreover, worker willingness to accept relatively
limited increases in wages and other compensation
might well begin to erode as concerns about job
security tended to diminish after an extended period
of relatively low unemployment. On balance, recent
experience had raised questions about the relationship between levels of resource use and inflation that
warranted careful monitoring.
In the Committee's discussion of policy for the
intermeeting period ahead, all but one member
favored or could accept an unchanged policy stance.
This policy position took account of current indications of a generally acceptable rate of economic
growth and the absence of any clear signs regarding
the future strength of the expansion in relation to the
economy's potential or the future course of inflation.
Several commented that current monetary policy
might be viewed as somewhat restrictive, though the
degree of restraint was difficult to calibrate and it did
not appear as yet to be inhibiting declines in
intermediate- and long-term interest rates, increases
in stock prices, or the availability of financing from
lending institutions.
Members expressed somewhat differing views
regarding the stance of monetary policy that was
likely to prove consistent with the Committee's
objectives over time. In the view of some, private
spending was not likely to have sufficient momentum
Minutes of the Federal Open Market Committee
to overcome the effects of increased fiscal restraint if
the current stance of monetary policy were maintained. In the circumstances, an easing at some point
would be needed to foster sustained economic growth
at an acceptable pace and would be consistent
with progress toward the System's price stability
objective. For most of these members, however, the
stronger-than-expected performance of the economy
in the third quarter had reduced the urgency of such a
policy move and had created enough uncertainties to
justify a careful appraisal of unfolding developments
before a decision was made to ease policy. In the
view of one member, the probability of a shortfall
from an acceptable rate of economic expansion was
sufficiently high to require an immediate easing of
policy. Other members believed that an unchanged
policy was desirable under current conditions and
that the direction and timing of the next policy move
were more open to question. Not only were recent
data giving an uncertain picture of the underlying
strength of aggregate demand, but current forecasts
generally did not point to progress toward the System's long-run goal of price stability. In this view,
therefore, the current stance of monetary policy, even
if slightly restrictive, was likely to be consistent
with satisfactory economic growth over time, and it
would provide better assurance of consolidating gains
against inflation and fostering some further moderation in price increases over coming years. With
regard to potential fiscal policy developments,
although an especially broad range of outcomes
seemed possible, the members agreed that the Committee could not freeze its policy options while it
awaited the outcome of a prolonged federal budget
debate nor could it commit itself to a specific
response to a particular fiscal policy agreement. Fiscal policy and any associated market reactions would
be among the many factors that would have to be
taken into account in the formulation of monetary
policy.
In the Committee's discussion of possible intermeeting adjustments to monetary policy, a majority
of the members expressed a preference for retaining a
symmetric directive. In their view, the potential need
to adjust policy during the relatively short intermeeting period was remote, and some of these members
also believed that the direction of the next adjustment
to policy was uncertain. A few also noted that the
adoption of a biased intermeeting instruction at this
point might send an unintended message regarding
the prevailing view within the Committee concerning
the risks to the expansion. The remaining members
said that they preferred a directive that was tilted
toward an easing policy action. Such an instruction in
147
the directive would be consistent with what they
viewed as the most likely policy course over coming
months. They agreed, however, that the current
uncertainties surrounding the economic outlook were
not likely to be resolved during the weeks immediately ahead, and since no policy action was likely to
be required in this period they could accept a symmetric directive.
At the conclusion of the Committee's discussion,
all but one of the members indicated that they could
vote for a directive that called for maintaining the
existing degree of pressure on reserve positions and
that did not include a presumption about the likely
direction of any adjustments to policy 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, the Committee decided that
slightly greater or slightly lesser reserve restraint
would be acceptable during the intermeeting period.
The reserve conditions contemplated at this meeting
were expected to be consistent with moderate growth
in M2 and M3 over coming months.
The information reviewed at this meeting suggests a
moderation in the expansion of economic activity after a
strong gain in the third quarter. Nonfarm payroll employment increased further in October and the civilian unemployment rate edged down to 5.5 percent. Industrial production fell somewhat in October after a moderate rise in
the third quarter. Total nominal retail sales were little
changed on balance over September and October. Singlefamily housing starts were up considerably in the third
quarter. Orders for nondefense capital goods point to substantial expansion of spending on business equipment in
the near term; nonresidential construction has risen appreciably further. The nominal deficit on U.S. trade in goods
and services narrowed over July and August from its
average rate in the second quarter. After increasing at
elevated rates in the early part of the year, consumer and
producer prices have risen more slowly on average in
recent months.
Short-term market interest rates have changed little on
balance since the Committee meeting on September 26
while long-term rates have fallen somewhat. In foreign
exchange markets, the trade-weighted value of the dollar in
terms of the other G-10 currencies has declined slightly
over the intermeeting period.
In October, M2 was unchanged and M3 growth moderated. For the year through October, M2 expanded at a rate
in the upper half of its range for 1995 and M3 grew at a
rate a little above its range. Growth in total domestic
nonfinancial debt has slowed somewhat in recent months
but for the year to date remains around the midpoint of its
monitoring range.
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 in July
148
Federal Reserve Bulletin • February 1996
reaffirmed the range it had established on January 3 1 February 1 for growth of M2 of 1 to 5 percent, measured
from the fourth quarter of 1994 to the fourth quarter of
1995. The Committee also retained the monitoring range of
3 to 7 percent for the year that it had set for growth of total
domestic nonfinancial debt. The Committee raised the 1995
range for M3 to 2 to 6 percent as a technical adjustment to
take account of changing intermediation patterns. For
1996, the Committee established on a tentative basis the
same ranges as in 1995 for growth of the monetary aggregates and debt, measured from the fourth quarter of 1995 to
the fourth quarter of 1996. 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 or slightly lesser reserve restraint
would be acceptable in the intermeeting period. The contemplated reserve conditions are expected to be consistent
with moderate growth in M2 and M3 over coming months.
Votes for this action: Messrs. Greenspan, McDonough,
Blinder, Hoenig, Kelley, Melzer, Ms. Minehan,
Mr. Moskow, Mses. Phillips and Yellen. Vote against
this action: Mr. Lindsey.
Mr. Lindsey dissented because he believed that
monetary policy should be eased. The evidence sug-
gested to him that in the absence of an easing move
the underlying rate of nominal GDP growth was
likely to be lower than needed to maintain real GDP
at or near its potential. The intermediate forecast was
subject to a number of significant risks: household
balance sheets seemed unlikely to sustain the current
rate of durables expenditure for any extended period;
government expenditures were certain to be cut substantially; and with fiscal contractions underway in
Europe and Canada and severe financial stresses
present in Japan and Mexico, he did not see much
likelihood of a substantial expansion of exports. In
keeping with his views, the financial markets were
signalling the likelihood that a weaker pace of nominal GDP growth would materialize. The yield curve
was virtually flat, with government securities up
through relatively long maturities trading at yields
below the current average federal funds rate. Thus,
markets would be unlikely to find some easing
inappropriate and over the intermediate horizon
would view the current level of short-term rates as
unsustainable.
It was agreed that the next meeting of the Committee would be held on Tuesday, December 19, 1995.
The meeting adjourned at 1:35 p.m.
Donald L. Kohn
Secretary
149
Legal Developments
FINAL RULE—AMENDMENT
TO REGULATION
K
The Board of Governors is amending 12 C.F.R. Part 203,
its Regulation K (International Operations of United States
Banking Organizations), to provide expanded general consent authority for investments in foreign companies by US.
banking organizations that are strongly capitalized and
well managed. This expanded authority is designed to
permit U.S. banking organizations meeting these requirements to make larger investments without the need for
prior approval or review. Certain investments or activities,
however, are not eligible for the expanded authority. The
final rule requires an investor making use of the expanded
authority to provide the Board with certain information
after an investment has been made. In addition, for those
investments requiring prior notice to the Board, the rule
would streamline the processing of such notices.
Effective December 21, 1995, 12 C.F.R. Part 211 is
amended as follows:
Part 211—International Banking Operations
(Regulation K)
1. The authority citation for Part 211 is revised to read as
follows:
Authority: 12 U.S.C. 221 et seq., 1818, 1841 et seq., 3101
et seq., 3901 et seq.
2. Section 211.2 is amended by redesignating paragraphs
(u) and (v) as paragraphs (v) and (w), respectively, and by
adding new paragraphs (u) and (x) to read as follows:
Section 211.2—Definitions.
(u) Strongly capitalized means:
(1) In relation to a parent member bank, that the
standards set out in 12 C.F.R. 208.33(b)(1) are satisfied; and
(2) In relation to an Edge or Agreement corporation or
a bank holding company, that it has a total risk-based
capital ratio of 10.0 percent or greater.
(x) Well managed means that the Edge or Agreement
corporation, its parent member bank, if any, and the
bank holding company have each received a composite
rating of 1 or 2 at its most recent examination or review
and are not subject to any supervisory enforcement
action.
3. Section 211.5 is amended by:
a. Redesignating paragraphs (c)(2) and (c)(3) as paragraphs
(c)(3) and (c)(4) respectively and by adding a new paragraph (c)(2); and
b. In newly designated paragraph (c)(3), by removing the
word "accepted" in the third sentence and adding in its
place the word "received".
The addition reads as follows:
Section 211.5—Investments and activities abroad.
(c^
-f- -i-
(2)(i) Expanded general consent for de novo investments. Notwithstanding the amount limitations of
paragraph (c)(1) of this section, but subject to the
other limitations of this section, the Board grants
expanded general consent authority for investments in
an organization by an investor that is strongly capitalized and well managed if:
(A) The activities of the organization are limited to
activities in which a national bank may engage
directly or in which a subsidiary may engage under
paragraph (d) of this section;
(B) In the case of an investor that is an Edge
corporation that is not engaged in banking or an
agreement corporation, the total amount invested in
such organization (in one transaction or a series of
transactions) does not exceed the lesser of 20 percent of the investor's Tier 1 capital or 2 percent of
the Tier 1 capital of the parent member bank;
(C) In the case of a bank holding company or
member bank investor, the total amount invested in
such organization (in one transaction or a series of
transactions) directly or indirectly does not exceed
2 percent of the investor's Tier 1 capital;
(D) All investments made, directly or indirectly, by
an Edge corporation not engaged in banking or an
agreement corporation during the previous 12month period under paragraph (c)(2) of this section,
when aggregated with the proposed investment,
would not exceed the lesser of 50 percent of the
total capital of the Edge or agreement corporation,
or 5 percent of the total capital of the parent member bank;
(E) All investments made, directly or indirectly, by
a member bank or a bank holding company during
150
Federal Reserve Bulletin • February 1996
the previous 12-month period under paragraph
(c)(2) of this section, when aggregated with the
proposed investment, would not exceed 5 percent
of its total capital; and
(F) Both before and immediately after the proposed
investment the investor, its parent member bank, if
any, and any parent bank holding company are
strongly capitalized and well managed.
(ii) Determining aggregate investment limits. For purposes of determining compliance with the aggregate
investment limits set out in paragraphs (c)(2)(i)(D)
and (E) of this section, an investment by an investor in
a subsidiary shall be counted only once notwithstanding that such subsidiary may, within 12 months of the
date of making the investment, downstream all or any
part of such investment to another subsidiary.
(iii) Additional investments. An investor that makes
investments under paragraph (c)(2)(i) of this section
may also make additional investments in an organization under the standards set forth in paragraphs
(c)(l)(ii), (c)(l)(iii) and (c)(l)(iv) of this section.
(iv) Ineligible investments. The following investments
are not eligible for the general consent under paragraph (c)(2)(i) of this section:
(A) An investment in a foreign country where the
investor does not have an affiliate or a branch;
(B) The establishment or acquisition of an initial
subsidiary bank in a foreign country;
(C) Investments in general partnerships or unlimited liability companies; and
(D) An acquisition of shares or assets of an organization that is not an affiliate or joint venture of the
investor.
(v) Post-investment notice. By the end of the month
following the month in which the investment is made,
the investor shall provide the Board with the following information relating to the investment:
(A) If the investment is in a joint venture, the
respective responsibilities of the parties to the joint
venture;
(B) Projections for the organization in which the
investment is made for the first year following the
investment; and
(C) Where the investment is made in an organization that incurred a loss in the last year, a description of the reasons for the loss and the steps taken
to address the problem.
>:
{
^
FINAL RULE—AMENDMENT
EQUAL
H
*
%
Part 268—Rules Regarding Equal Opportunity
1. The authority citation for Part 268 continues to read as
follows:
Authority: 12 U.S.C. 244 and 248(i), (k) and (1).
2. In section 268.207, paragraph (e) is revised to read as
follows:
Section 268.207—Investigation of complaints.
(e)(1) The Board shall complete its investigation within
180 days of the date of the filing of an individual
complaint or within the time period contained in the
determination of the Commission on review of a dismissal pursuant to section 268.206 of this part. By
written agreement within those time periods, the complainant and the Board may voluntarily extend the time
period for not more than an additional 90 days. The
Board may unilaterally extend the time period or any
period of extension for not more than 30 days where it
must sanitize an investigative file that may contain information classified pursuant to Executive Order No.
12356, or successor orders, as secret in the interest of
national defense or foreign policy, provided the Board
notifies the complainant of the extension.
(2) Confidential supervisory information, as defined in
12 C.F.R. 261.2(b), and other confidential information of
the Board may be included in the investigative file by
the investigator, the EEO Programs Director, or another
appropriate officer of the Board, where such information
is relevant to the complaint. Neither the complainant nor
the complainant's personal representative may make further disclosure of such information, however, except in
compliance with the Board's Rules Regarding Availability of Information, 12 C.F.R. Part 261, and where applicable, the Board's Rules Regarding Access to and Review of Personal Information in Systems of Records,
12 C.F.R. Part 261a.
^
TO RULES
REGARDING
OPPORTUNITY
The Board of Governors is amending 12 C.F.R. Part 268,
its Rules Regarding Equal Opportunity (Rules) to correct
an ambiguity in the provision regarding access to the
investigative file. The Rules set out the complaint processing procedures governing complaints by Board em-
ployees and applicants for employment alleging discrimination in employment, and related matters.
Effective February 5, 1996, 12 C.F.R. Part 268 is
amended as follows:
Section 268.304—[Amended]
3. In section 268.304(a)(3)(i)(A), remove the words "Executive Order No. 10450 (3 C.F.R., 1949-1953 Comp., P.
936)" and add in their place, the words "Executive Order
No. 12356 (3 C.F.R., 1982 Comp., P. 166)".
Legal Developments
ORDERS ISSUED UNDER BANK HOLDING
COMPANY
ACT
Orders Issued Under Section 3 of the Bank Holding
Company Act
1st United Bancorp
Boca Raton, Florida
Order Approving the Acquisition of a Bank Holding
Company, Merger of Banks, and Establishment of
Branches
1st United Bancorp, Boca Raton, Florida ("1st United"), a
bank holding company within the meaning of the Bank
Holding Company Act ("BHC Act"), has applied under
section 3 of the BHC Act (12 U.S.C. § 1842) to acquire all
the voting securities of The American Bancorporation of
the South ("American"), and thereby indirectly acquire
The American Bank of the South ("American Bank"), both
of Merritt Island, Florida. 1st United Bank, Boca Raton,
Florida ("United Bank"), a state member bank and a
wholly owned subsidiary of 1st United, also has applied
pursuant to section 18(c) of the Federal Deposit Insurance
Act (12 U.S.C. § 1828(c)) (the "Bank Merger Act") to
merge with American Bank, and thereby to establish
branches pursuant to section 9 of the Federal Reserve Act
(12 U.S.C. § 321) at locations set forth in the Appendix. 1
Notice of the applications, affording interested persons
an opportunity to submit comments, has been published
(60 Federal Register 48,161). As required by the Bank
Merger Act, reports on the competitive effects of the
merger were requested from the United States Attorney
General, the Office of the Comptroller of the Currency
("OCC"), and the Federal Deposit Insurance Corporation
("FDIC"). The time for filing comments has expired, and
the Board has considered the applications and all comments received in light of the factors set forth in the BHC
Act, the Bank Merger Act, and the Federal Reserve Act.
1st United is the 34th largest commercial banking organization in Florida, controlling approximately $271 million
in deposits, representing less than 1 percent of total deposits in commercial banking organizations in the state. 2
American is the 62d largest commercial banking organization in Florida, controlling approximately $154 million in
deposits, representing less than 1 percent of total deposits
of commercial banking organizations in the state. Upon
consummation of the proposal, 1st United would become
the 25th largest commercial banking organization in Florida, and would control approximately $425 million in
deposits, representing less than 1 percent of total deposits
in commercial banking organizations in the state.
1st United and American do not compete directly in any
relevant banking market. As noted above, competitive fac-
1. 1st United proposes to merge American into TAB Acquisition
Co. ("Newco"), a newly formed subsidiary of 1st United, and then
merge American Bank into United Bank.
2. Deposit data are as of June 30, 1995.
151
tor reports on this proposal were sought from the Attorney
General, the OCC, and the FDIC. The Department of
Justice concluded that consummation of this proposal
would not have any significantly adverse effects on competition, and the OCC and FDIC did not object to consummation of this proposal. In light of all the facts of record, the
Board concludes that consummation of this proposal is not
likely to have a significantly adverse effect on competition
in any relevant banking market.
The Board has received comments from a shareholder of
1st United ("Protestant") alleging that consummation of
this proposal would have an adverse effect on the financial
resources of 1st United. Protestant contends that the financial condition of 1st United and United Bank may be
adversely affected by 1st United's potential assumption of
a note owed by American to a third party ("Noteholder"),
and the resolution of litigation between American and the
Noteholder and between American and a former director of
American. Protestant also alleges that 1st United's financial projections are inaccurate because they overestimate
the amount that 1st United would be able to recover on
American Bank's problem assets.
The Board has carefully reviewed the effects this transaction would have on the financial resources of 1st United
and United Bank. 1st United has indicated that it would
borrow funds from its directors to repay American's debt
to Noteholder upon consummation of this proposal. 1st
United's debt service projections, which take into consideration this debt, appear reasonable and are consistent with
the Board's guidelines. In addition, American has settled
all outstanding litigation with Noteholder, and the Agreement and Plan of Merger between 1st United and American requires the establishment of an escrow account for
payment of any judgment against American in connection
with the litigation involving its former director. 3
The Board has reviewed examination reports of American, American Bank, 1st United, and United Bank in
connection with this proposal. Based on all the facts of
record, including these examination reports and other supervisory information relating to the financial condition
and managerial resources of 1st United and United Bank,
the Board concludes that the financial and managerial
resources and future prospects of 1st United and United
Bank are consistent with approval of this proposal, as are
the other supervisory factors that the Board is required to
3. Protestant also alleges that 1st United's managerial resources
would be impaired by the appointment of American Bank directors to
the board of directors of 1st United or United Bank, and the establishment of an advisory board that would include people who have
defaulted on loans from American Bank. 1st United has indicated that
neither it nor United Bank has determined to add directors or establish
an advisory board. Moreover, 1st United and United Bank have
committed that they will provide the Federal Reserve Bank of Atlanta
with at least 30 days prior notice before either entity adds any current
or former director or executive officer of American or American Bank
("American-affiliated individual") to its board of directors or employs
any American-affiliated individual as a senior executive officer, and
that they will not add or employ any such American-affiliated individual if the Reserve Bank issues a notice of disapproval.
152
Federal Reserve Bulletin • February 1996
consider under the BHC Act, the Bank Merger Act, and the
Federal Reserve Act. 4
Protestant contends that asset sales by United Bank after
consummation of the proposal would have a negative effect
on residential and commercial real estate prices in Brevard
County, and that United Bank would decrease the interest
rates paid by American Bank on time and savings deposits.
In addition, Protestant alleges that consummation of the
proposal would result in the loss of the largest community
bank in Brevard County. 1 st United responded that it will
continue to pay market interest rates on time and savings
deposits acquired from American Bank after consummation of the proposal.
The Board notes that United Bank received a "satisfactory" rating under the Community Reinvestment Act
(12 U.S.C. § 2901 et seq.) ("CRA") from the Federal
Reserve Bank of Atlanta, its primary federal supervisor, in
its most recent CRA performance examination, as of February 28, 1994. The Board also notes that American Bank
is operating under a cease and desist order issued by the
FDIC, its primary federal supervisor, due to its financial
and managerial condition, and that consummation of this
proposal would result in a financially stronger institution
better able to serve the needs of its community. 5 In light of
all the facts of record, the Board concludes that convenience and needs factors are consistent with approval of
this proposal. 6
Based on the foregoing and all the facts of record, the
Board has determined that these applications should be,
and hereby are, approved. 7 The Board's approval is specif-
4. Protestant also alleges that the proposal is not in the best interest
of 1st United shareholders. The Board notes that the courts can
provide Protestant adequate relief if he can substantiate that 1st United
or American has violated applicable state or Federal laws in connection with this proposal. Based on the foregoing and other facts of
record, the Board concludes that these allegations do not present
adverse considerations under the statutory factors in the BHC Act, the
Bank Merger Act, or the Federal Reserve Act.
5. Protestant also asserts that residents of Brevard County, Florida,
which includes Merritt Island, were not given proper notice of the
proposed transactions. The record indicates that notice of the proposal
was published in the Federal Register and a newspaper of general
circulation in Brevard County in accordance with the publication
requirements set forth in the Board's Rules of Procedure (12 C.F.R.
262.3(b)) and Regulation Y (12 C.F.R. 225.14(b)). Protestant also
alleges that Florida law requires that 1st United's shareholders approve the proposal. Because this proposal involves the merger of
American and American Bank into wholly owned subsidiaries of 1st
United, however, Florida law appears to require only that 1st United,
as sole shareholder of its subsidiaries, approve the transactions. See
Fla. Stat. Ann. §§ 607.1101, 607.1103, and 658.44.
6. The Board also received comments from an individual who
alleged that title to property acquired by American Bank in satisfaction of a debt previously contracted properly belongs to a condominium association. The Board notes that the courts have authority to
provide redress to this individual or the association if the allegations
can be substantiated.
7. Protestant has requested that the Board delay consideration of this
proposal for several reasons, including the need for resolution of all
litigation to which American is a party, a definitive agreement between 1 st United and Noteholder about the assumption of American's
debt, and additional information about the formation and registration
ically conditioned on compliance by 1 st United and United
Bank with the commitments made in connection with these
applications. This approval is further subject to 1st United
obtaining all necessary approvals from the State of Florida.
For purposes of this action, the commitments and conditions relied on in reaching this decision are deemed to be
conditions imposed in writing by the Board and, as such,
may be enforced in proceedings under applicable law.
These transactions shall not be consummated before the
fifteenth 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 the Federal Reserve Bank of Atlanta, acting
pursuant to delegated authority.
By order of the Board of Governors, effective December 11, 1995.
Voting for this action: Chairman Greenspan, and Governors Lindsey, Phillips, and Yellen. Absent and not voting: Vice Chairman
Blinder and Governor Kelley.
JENNIFER J. JOHNSON
Deputy Secretary of the Board
Appendix A
850 Triangle Road, Merritt Island, FL
102 W. Central Boulevard, Cape Canaveral, FL
7100 North Atlantic Avenue, Cape Canaveral, FL
340 W. King Street, Cocoa, FL
1775 N. Atlantic Avenue, Cocoa Beach, FL
1680 Clearlake Road, Cocoa, FL
1350 N. Courtenay Parkway, Merritt Island, FL
2481 Croton Road, Melbourne, FL
445 Fifth Avenue, Indialantic, FL
2000 Highway A1 A, Indian Harbour Beach, FL
440 S. Babcock, Melbourne, FL
4940 Babcock, Palm Bay, FL
6899 North U.S. Highway 1, Cocoa, FL
1902 S. Flake Boulevard, Rockledge, FL
4250 S. Washington Avenue, Titusville, FL
326 E. Merritt Island Causeway, Merritt Island, FL
of Newco. As noted above, American has settled all outstanding
litigation with Noteholder, and 1st United would not assume American's debt to Noteholder. In addition, 1st United and American have
agreed to establish an escrow account to pay any liability arising from
American's litigation with its former director. Furthermore, 1st United
has provided the Board with charter documents for Newco and has
indicated that Newco is registered with the Florida Secretary of State.
Protestant has had ample opportunity to present written submissions
and, in fact, has submitted written comments that have been considered by the Board. Based on all the facts of record, the Board
concludes that the record is sufficient to act on this proposal at this
time, and that delay of action on the proposal on the grounds of
informational insufficiency is not warranted.
Legal Developments
First American Corporation
Nashville, Tennessee
Order Approving the Acquisition
Company
of a Bank Holding
First American Corporation, Nashville ("First American"),
a bank holding company within the meaning of the Bank
Holding Company Act ("BHC Act"), has applied under
section 3 of the BHC Act (12 U.S.C. § 1842) to acquire all
the voting shares of First City Bancorp, Murfreesboro
("First City"), and thereby indirectly acquire its subsidiary
banks, First City Bank, Murfreesboro, and Citizens Bank,
Smithville, all in Tennessee.
Notice of the application, affording interested persons an
opportunity to submit comments, has been published
(60 Federal Register 48,996 (1995)). 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 of the BHC Act.
First American, with total consolidated assets of
$8.1 billion, operates subsidiary banks in Tennessee, Kentucky, and Virginia. First American is the second largest
banking organization in Tennessee, controlling deposits of
approximately $5.9 billion, representing 11.8 percent of
total deposits in commercial banking organizations in the
state.1 First City is the 17th largest banking organization in
Tennessee, controlling deposits of approximately $297.2
million, representing less than 1 percent of total deposits in
commercial banking organizations in the state. Upon consummation of this proposal, First American would remain
the second largest banking organization in Tennessee, controlling deposits of approximately $6.2 billion, representing 12.4 percent of total deposits in commercial banking
organizations in the state.
First American and First City compete directly in the
Nashville, Tennessee, banking market ("Nashville banking
market"). 2 On consummation of this proposal, the market
would remain moderately concentrated, 3 as measured by
the Herfindahl-Hirschman Index ("HHI"), and this proposal would not result in market concentration levels that
exceed those set forth in the Department of Justice Merger
Guidelines. 4 In addition, numerous competitors would re-
1. All asset data are as of June 30, 1995.
2. The Nashville banking market is approximated by Cheatham,
Davidson, Robertson, Rutherford, Sumner, Williamson and Wilson
Counties, plus the town of Spring Hill in Maury County, all in
Tennessee.
3. Market data are as of June 30, 1994. 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).
4. The HHI for the Nashville banking market would increase
56 points to 1492 as a result of this transaction. 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
153
main in the market. After considering the competition
offered by the banking organizations that would remain in
the market, the increase in concentration as measured by
the HHI, and all other facts of record, the Board has
concluded that consummation of this proposal would not
result in any significantly adverse effects on competition in
the Nashville banking market, or any other relevant banking market.
After a review of all the facts of record, including
information provided by relevant federal supervisors, the
Board also has concluded that the financial and managerial
resources and future prospects of First American, First
City, and their respective subsidiaries, and other supervisory factors the Board must consider under section 3 of the
BHC Act are consistent with approval of this proposal.
Considerations relating to the convenience and needs of
the communities to be served also are consistent with
approval.
Based on the foregoing, the Board has determined that
this application should be, and hereby is, approved. The
Board's approval is specifically conditioned on compliance
by First American with all commitments made in connection with this application. For the purpose of this action,
the commitments and conditions relied on by the Board in
reaching its decision are deemed to be conditions imposed
in writing by the Board in connection with its findings and
decision and, as such, may be enforced in proceedings
under applicable law.
The acquisition of First City shall not be consummated
before the fifteenth calendar day following the effective
date of this order, or later than three months following the
effective date of this order, unless such period is extended
for good cause by the Board or by the Federal Reserve
Bank of Atlanta, acting pursuant to delegated authority.
By order of the Board of Governors, effective December 11, 1995.
Voting for this action: Chairman Greenspan, and Governors Lindsey, Phillips, and Yellen. Absent and not voting: Vice Chairman
Blinder and Governor Kelley.
JENNIFER J. JOHNSON
Deputy Secretary of the Board
1000 and 1800 is considered moderately concentrated. The Justice
Department has informed the Board that a bank merger or acquisition
generally will not be challenged (in the absence of other factors
indicating anticompetitive effects) unless the post-merger HHI is at
least 1800 and the merger increases the HHI by more than 200 points.
The Justice Department has stated that the higher than normal threshold for an increase in the HHI when screening bank mergers and
acquisitions for anticompetitive effects implicitly recognizes the competitive elfect of limited-purpose lenders and other non-depository
financial entities.
154
Federal Reserve Bulletin • February 1996
NationsBank Corporation
Charlotte, North Carolina
NB Holdings, Inc.
Charlotte, North Carolina
bank holding company, if certain conditions are met. 3
These conditions are met in this case. 4 In view of all the
facts of record, the Board is permitted to approve this
proposal under section 3(d) of the BHC Act.
Convenience and Needs
Order Approving the Acquisition of a Bank Holding
Company
NationsBank Corporation and NB Holdings Corporation,
both of Charlotte, North Carolina (together, "NationsBank"), bank holding companies within the meaning
of the Bank Holding Company Act ("BHC Act"), have
applied under section 3 of the BHC Act (12 U.S.C. § 1842)
to acquire North Florida Bank Corporation ("North Florida") and thereby indirectly acquire its wholly owned subsidiary, Bank of Madison County, National Association
("Madison National"), both of Madison, Florida. 1
Notice of the application, affording interested persons an
opportunity to submit comments, has been published
(60 Federal Register 49,277 (1995)). 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.
NationsBank, with total consolidated assets of approximately $188 billion, operates subsidiary banks in nine
states and the District of Columbia. 2 NationsBank is the
fourth largest commercial banking organization in the
United States, controlling approximately 4.8 percent of
total banking assets in the United States, and approximately 3.7 percent of total insured deposits in the United
States. NationsBank is the third largest commercial banking organization in Florida, controlling deposits of approximately $20.8 billion, representing 14.9 percent of total
deposits in commercial banking organizations in the state.
NationsBank and North Florida do not compete in any
banking market. Based on all the facts of record, the Board
concludes that consummation of the proposed transaction
would not have a significantly adverse effect on competition or the concentration of banking resources in any
relevant banking market.
Interstate
Analysis
Section 3(d) of the BHC Act, as amended by Section 101
of the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994, allows the Board to approve an application by a bank holding company to acquire control of a
bank located in a state other than the home state of such
1. North Florida's subsidiary currently is a state chartered commercial bank that would be converted to a national bank immediately
before the proposed transaction. NationsBank would cause Madison
National to merge into NationsBank's wholly owned subsidiary, NationsBank of Florida, N.A., Tampa, Florida, immediately after the
acquisition of North Florida.
2. Asset and deposit data are as of June 30, 1995, and include
acquisitions by NationsBank approved after that date. NationsBank
also operates a limited-purpose credit card bank in Delaware.
Considerations
In acting on an application to acquire a depository institution under the BHC Act, the Board must consider the
convenience and needs of the communities to be served
and take into account the records of the relevant depository
institutions under the Community Reinvestment Act
(12 U.S.C. § 2901 et seq.) ("CRA"). The CRA requires the
federal financial supervisory agencies to encourage financial institutions to help meet the credit needs of the local
communities in which they operate, consistent with their
safe and sound operation. To accomplish this end, the CRA
requires the appropriate federal supervisory authority to
"assess the institution's record of meeting the credit needs
of its entire community, including low- and moderateincome neighborhoods, consistent with the safe and sound
operation of such institution," and to take that record into
account in its evaluation of bank expansion proposals. 5
The Board has received comments from the Central
Piedmont Economic Association ("Protestant") alleging
that a NationsBank subsidiary, NationsBank, N.A., Richmond, Virginia ("NationsBank Virginia"), discriminates
against African Americans and low-income individuals in
its general lending practices. In particular, Protestant alleges that homebuyer education seminars sponsored by
NationsBank Virginia in Lynchburg, Virginia, do not benefit African Americans and low-income individuals, and
that, through its outreach and lending efforts, NationsBank
Virginia attempts to direct African-American and lowincome borrowers in Lynchburg toward predominantly
African-American and low-income parts of the city, in
violation of the Fair Housing Act, the Equal Credit Opportunity Act, and the CRA. 6
3. Pub. L. No. 103-328, 108 Stat. 2338 (1994). 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. For purposes of the BHC Act,
NationsBank's home state is North Carolina.
4. 12 U.S.C. §§ 1842(d)(1)(A) and (B) and 1842(d)(2)(A) and (B).
NationsBank is adequately capitalized and adequately managed. The
Board has been informally advised by the Florida State Comptroller
that Madison National, through its state chartered predecessor, has
been in existence and continuously operated for the minimum period
of time required under Florida law. In addition, upon consummation
of this proposal, NationsBank and its affiliates would control less than
10 percent of the total amount of deposits of insured depository
institutions in the United States and less than 30 percent of the total
amount of deposits of insured depository institutions in Florida.
5. 12 U.S.C. § 2903.
6. Protestant also alleged that NationsBank Virginia conspired with
the City of Lynchburg not to inform African Americans and lowincome individuals about low-interest loans available under the city's
Community Development Block Grant ("CDBG") program and to
direct funds from this program to unauthorized projects. Similar
allegations by Protestant regarding the Lynchburg CDBG program
Legal Developments
The Board has carefully reviewed the CRA performance
records of NationsBank and its subsidiary banks and of
North Florida and Madison National, all comments received on this application, all responses to these comments, and all other relevant facts of record in light of the
CRA, the Board's regulations, and the Statement of the
Federal Financial Supervisory Agencies Regarding the
Community Reinvestment Act ("Agency CRA Statement"). 7
The Agency CRA Statement provides that a CRA examination is an important and often controlling factor in the
consideration of an institution's CRA record and that reports of these examinations will be given great weight in
the applications process. 8 The Board notes that all of
NationsBank's subsidiary banks received ratings of "satisfactory" or better from their primary supervisor, the Office
of the Comptroller of the Currency ("OCC"), at their most
recent examinations for CRA performance, as of July
1995, and that NationsBank Virginia received an "outstanding" rating at that time ("1995 Examination"). Examiners of NationsBank Virginia found no evidence of prohibited discriminatory practices or of practices intended to
discourage applications for the types of products set forth
in the bank's CRA statement, and determined that NationsBank Virginia has adequate policies, procedures, and
training programs in place to support nondiscrimination in
lending practices.
Examiners also noted that NationsBank's Fair Lending
Group reviews the performance of all of NationsBank's
subsidiary banks in providing all applicants with fair access to credit, including maintaining second and third
review programs for applications that are being considered
for denial. Declined applicants for home mortgage and
home improvement loans also may have their loan decisions reviewed by an independent board provided by the
National Urban League. The geographic distribution of
NationsBank Virginia's credit extensions, applications, and
denials also was considered by examiners to be reasonable,
and revealed that, on the whole, the bank effectively
reached low- and moderate-income individuals and areas
throughout the communities it served. For example, during
were reviewed by the United States Department of Housing and
Urban Development ("HUD") in 1991, and HUD concluded that the
administration of the Lynchburg CDBG program was in compliance
with the Housing and Community Development Act of 1974. See
Crestar Financial Corporation, 80 Federal Reserve Bulletin 145
(1994). Moreover, the facts of record indicate that NationsBank Virginia's predecessor banks did not participate in the Lynchburg CDBG
program at the time of the alleged deception. The evidence before the
Board at this time does not indicate that NationsBank engaged in any
improper actions related to the Lynchburg CDBG program.
HUD intends to perform another review of this commenter's allegations. If the review produces information indicating that NationsBank
has engaged in any improper actions, the Office of the Comptroller of
the Currency, which is the primary federal banking supervisor of
NationsBank Virginia, and the Board have sufficient statutory authority to take appropriate action. The Board has provided the OCC with a
copy of the commenter's allegations.
7. 54 Federal Register 13,742 (1989).
8. Id. at 13,745.
155
1993, NationsBank Virginia and NationsBank Mortgage
Company, Dallas, Texas, NationsBank's home mortgage
lending subsidiary, made 15.3 percent of their home mortgage loans in the Lynchburg community in low- and
moderate-income census tracts, compared to 8.4 percent
for all other lenders in the area. In addition, 31 percent of
the home mortgage loans made by NationsBank in the
Lynchburg community were made to low- and moderateincome borrowers, compared to 23.7 percent for all other
lenders in the area.
The 1995 Examination also found that both NationsBank, on a corporate level, and NationsBank Virginia
engaged in extensive outreach activities with a broad spectrum of representatives from various communities, resulting in the development of innovative products and services
to serve all of NationsBank Virginia's communities. In
addition, the bank maintained extensive calling efforts in
all of its delineated communities, including Lynchburg.
During 1995, NationsBank Virginia also developed a marketing plan specifically focused on low- and moderateincome individuals, small businesses owned by women
and minorities, and child care center operators, that employs the full range of marketing tools the bank uses in its
other marketing efforts. Low- and moderate-income areas
in markets such as the Lynchburg area also receive at least
one direct mailing a year that describes the bank's credit
products. 9 In addition, NationsBank Virginia has a program to identify census tracts in which the bank's commercial, consumer, and mortgage lending can be improved and
to develop broadly coordinated marketing plans to increase
lending levels in these areas. Bank management reviews
these enhanced marketing plans and their results quarterly.
Examiners found that NationsBank Virginia participates
in loans and loan pools with other financial institutions,
nonprofit community development organizations, public
housing authorities, private developers, and other organizations that promote affordable rental and owner-occupied
housing for low- and moderate-income individuals. For
example, NationsBank Virginia participates in a partnership with the Association of Community Organizations for
Reform Now ("ACORN"), in which ACORN provides
homebuyer education seminars and helps identify borrowers who qualify for home mortgage loans with total fees
and down payment as low as $1,000. In 1993, NationsBank
Virginia made 500 loans totalling $52.5 million in Virginia, Maryland, and the District of Columbia under this
program. 10 In 1994, NationsBank Virginia provided
$125,000 in grants to nonprofit community-based organizations that provided credit counseling, homebuyer education, and counseling to first-time homebuyers, which
helped 139 individuals and families acquire a home. The
bank was the largest participant in the Virginia Housing
9. Under this program in 1994, NationsBank conducted a direct
mail campaign that resulted in the origination of $18 million in auto
loans in low- and moderate-income areas.
10. NationsBank Virginia made 39 loans totalling $3.9 million
under this program in Virginia.
156
Federal Reserve Bulletin • February 1996
Development Authority loan program, and made 324 loans
totalling $23 million under this program during 1994.
In terms of small business lending, the 1995 Examination states that the bank made 4,817 business loans in
original amounts less than $500,000 during 1994, for a
total of $420.1 million in small business loans. The bank
was the largest participant in the Virginia Small Business
Financing Authority Loan Guaranty Program and the City
of Richmond Bank Participation Loan Program, and participated in seven other similar programs. NationsBank Virginia also made a $3 million equity investment in Anthem
Capital Corporation, a small business investment company.
After reviewing all the facts of record, including all
comments received by the Board and relevant reports of
examination, the Board concludes that the CRA performance record of NationsBank Virginia and the other NationsBank subsidiary banks are consistent with approval of
this application. Based on this and all the other facts of
record, the Board has concluded that convenience and
needs considerations are consistent with approval of this
application.
Other
Considerations
The Board also has reviewed the financial and managerial
resources and future prospects of NationsBank, North Florida, and their respective subsidiaries and other supervisory
factors the Board must consider under section 3 of the
BHC Act. 11 Based on all the facts of record, the Board has
concluded that these factors are consistent with approval of
this proposal.
Based on the foregoing and in light of all the facts of
record, the Board has determined that this application
should be, and hereby is, approved. The Board's approval
is expressly conditioned on compliance with the commitments made in connection with this application. The commitments and conditions relied on by the Board in reaching
its decision are both deemed to be conditions imposed in
writing in connection with its findings and decisions and,
as such, may be enforced in proceedings under applicable
law.
This transaction shall not be consummated before the
fifteenth calendar day following the effective date of this
11. The Board received comments from an individual who owns a
small business alleging that NationsBank Virginia acted improperly in
denying this commenter's loan request and in its dealings with this
commenter. NationsBank Virginia responds that all actions it took in
this matter were based on the business's financial condition and were
consistent with its general lending criteria and procedures. The Board
has carefully considered these comments in light of all the facts of
record, including supervisory reports of examination assessing the
managerial strengths and resources of the bank. In addition, the Board
has considered the findings of the 1995 Examination, discussed above,
that no evidence of prohibited discriminatory practices or of practices
intended to discourage applications were disclosed, and that NationsBank Virginia is an active small business lender. Based on these
and other facts of record, The Board concludes that these comments
do not warrant denial of this proposal. The Board also has forwarded
these comments to the OCC, which is the primary federal banking
supervisor for NationsBank Virginia.
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 Richmond,
acting pursuant to delegated authority.
By order of the Board of Governors, effective December 6, 1995.
Voting for this action: Chairman Greenspan, Vice Chairman
Blinder, and Governors Kelley, Phillips, and Yellen. Absent and not
voting: Governor Lindsey.
JENNIFER J. JOHNSON
Deputy Secretary of the Board
Norwest Corporation
Minneapolis, Minnesota
Order Approving the Acquisition
Company
of a Bank Holding
Norwest Corporation, Minneapolis, Minnesota ("Norwest"), a bank holding company within the meaning of the
Bank Holding Company Act ("BHC Act") has filed an
application pursuant to section 3(a)(3) of the BHC Act
(12 U.S.C. § 1842(a)(3)) to acquire Canton Bancshares,
Inc. ("Canton"), and indirectly acquire Canton State Bank,
both of Canton, Illinois.
Notice of this proposal, affording interested persons an
opportunity to submit comments, has been published
(60 Federal Register 49,846 (1995)). 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. Norwest,
with total consolidated assets of $66.6 billion, 1 controls
banks in Arizona, Colorado, Iowa, Illinois, Indiana, Minnesota, Montana, Nebraska, New Mexico, North Dakota,
Ohio, South Dakota, Texas, Wisconsin, and Wyoming,
representing 1.6 percent of total deposits in depository
institutions in the United States. 2 Norwest is the 82d largest
commercial banking organization in Illinois, controlling
total deposits of $219 million, representing less than 1
percent of total deposits in depository institutions in the
state. Canton is the 354th largest commercial banking
organization in Illinois, controlling deposits of approximately $44.2 million, representing less than 1 percent of
total deposits in insured depository institutions in the state.
On consummation of this proposal, Norwest would become the 71st largest commercial banking organization in
Illinois, controlling $263.2 million in deposits, representing less than 1 percent of total deposits in insured depository institutions in the state.
1. Deposit data are as of June 30, 1995. All market data are as of
June 30, 1994.
2. In this context, depository institutions include commercial banks,
savings banks, and savings associations with deposits insured by the
Federal Deposit Insurance Corporation ("insured depository institutions").
Legal Developments
Interstate
Analysis
Section 3(d) of the BHC Act, as amended by Section 101
of the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994, allows the Board to approve an application by a bank holding company to acquire control of a
bank located in a state other than the home state of such a
bank holding company, if certain conditions are met. 3
These conditions are met in this case. 4 In view of all the
facts of record, the Board is permitted to approve this
proposal under section 3(d) of the BHC Act.
Competitive
Considerations
Norwest and Canton compete directly in the Canton banking market. 5 In the Canton banking market, Norwest is the
sixth largest commercial banking organization, controlling
$27.6 million in deposits, representing approximately
8 percent of total deposits in depository institutions in the
market ("market deposits"). 6 Canton is the second largest
depository institution in the market, controlling deposits of
$44.6 million, representing approximately 13 percent of
market deposits. On consummation of this proposal, Norwest would become the second largest depository institution in the market, controlling deposits of $72.2 million,
representing approximately 21 percent of total deposits in
depository institutions in the market. The concentration in
the market as measured by the Herfindahl-Hirschman Index ("HHI") would increase by 201 points to 2066 points
as a result of this proposal. 7
3. Pub. L. No. 103-328, 108 Stat. 2338 (1994). 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. For purposes of the BHC Act,
Norwest's home state is Minnesota.
4. 12 U.S.C. §§ 1842(d)(1)(A) and (B) and 1842(d)(2)(A) and (B).
Norwest is adequately capitalized and adequately managed. Canton's
subsidiary bank in Illinois has been in existence and continuously
operated for the minimum period of time required under applicable
state law. Upon consummation, Norwest and its affiliates would
control less than 10 percent of the total amount of deposits of insured
depository institutions in the United States, and less than 30 percent of
the total amount of deposits of insured depository institutions in
Illinois. All other requirements of section 3(d) of the BHC Act would
also be met on consummation of this proposal.
5. The Canton banking market is approximated by the northeastern
portion of Fulton County, Illinois (Fairview, Farmington, Joshua,
Canton, Orion, Putman, Buckheart, Banner, Lewistown, Liverpool,
and Waterford townships).
6. Market share data before consummation are based on calculations
in which the deposits of thrift institutions are included at 50 percent.
The Board previously has indicated that thrift institutions have become, or have the potential to become significant competitors of
commercial banks. See WM Bancorp, 76 Federal Reserve Bulletin
788 (1990); National City Corporation, 70 Federal Reserve Bulletin
743 (1984).
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 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
157
Eight competitors would remain in the market after
consummation, including the largest depository institution
in the market, which controls deposits of $122 million,
representing 34.9 percent of total deposits in depository
institutions in the market. In addition, three other depository institutions, each controlling over 10 percent of market deposits would remain in this market. The Board also
has considered the fact that one of Illinois' largest credit
unions, Citizens Equity Federal Credit Union, Peoria, Illinois ("Citizens"), controlling assets of $1.3 billion, competes in the Canton market. All residents of Fulton County,
Illinois, which includes the Canton market, are eligible for
membership in Citizens, and Citizens actively engages in
commercial lending. 8
In accordance with the BHC Act, the Board sought
comments from the United States Attorney General, the
Office of the Comptroller of the Currency ("OCC"), and
the Federal Deposit Insurance Corporation ("FDIC") on
the competitive effects of this proposal. The Attorney
General has advised the Board that the proposed transaction is not likely to have a significantly adverse effect on
competition in any relevant banking market. The OCC and
the FDIC have not objected to consummation of this proposal or indicated it would have any significantly adverse
competitive effects in any relevant banking market.
Based on all the facts of record, including the small
amount by which the Department of Justice merger guidelines are exceeded, and the number of competitors that
would remain in the market, the Board concludes that the
consummation of this proposal would not have a significantly adverse effect on competition or the concentration of
banking resources in the Canton, Illinois, banking market
or in any other relevant market.
Other
Considerations
The financial and managerial resources and future prospects of Norwest, Canton, and their respective subsidiaries,
are consistent with approval, as are the other supervisory
factors the Board must consider under section 3 of the
BHC Act. The convenience and needs of the communities
to be served also are consistent with approval.
Based on the foregoing and other facts of record, the
Board has determined that the application should be, and
hereby is, approved. The Board's approval is expressly
conditioned on Norwest's compliance with all the commitments made in connection with this application. The commitments and conditions relied on by the Board in reaching
this decision are deemed to be conditions imposed in
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 entities.
8. Credit unions in Illinois are permitted to make commercial loans.
Citizens has a commercial loan officer and reported $19.3 million in
outstanding commercial loans as of June 30, 1994.
158
Federal Reserve Bulletin • February 1996
writing by the Board in connection with its findings and
decision, and, as such, may be enforced in proceedings
under applicable law.
The transaction shall not be consummated before the
fifteenth calendar day following the effective date of this
order, and the acquisition 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 Chicago, acting pursuant to delegated authority.
By order of the Board of Governors, effective December 18, 1995.
Voting for this action: Chairman Greenspan, Vice Chairman
Blinder, and Governors Kelley, Lindsey, Phillips, and Yellen.
WILLIAM W . W I L E S
Secretary of the Board
Orders Issued Under Section 4 of the Bank Holding
Company Act
Barclays PLC
London, England
Barclays Bank PLC
London, England
Order Approving a Notice to Acquire
Companies
Nonbanking
Barclays PLC and Barclays Bank PLC, both of London,
England ("Barclays"), bank holding companies within the
meaning of the Bank Holding Company Act ("BHC Act"),
have requested Board approval under section 4(c)(8) of the
BHC Act (12 U.S.C. § 1843(c)(8)) and section 225.23 of
the Board's Regulation Y (12 C.F.R. 225.23) to acquire
Wells Fargo Investment Advisors; The Nikko Building
U.S.A., Inc.; Wells Fargo Institutional Trust Company,
N.A.; Wells Fargo Nikko Investment Advisors; Wells
Fargo Nikko Investment Advisors International; and Wells
Fargo Foreign Funds Advisors, all of San Francisco, California. Barclays also has requested Board approval to
purchase certain assets and assume certain liabilities of the
401(k) MasterWorks Division of Wells Fargo Bank, N.A.,
San Francisco, California (hereinafter all of the entities to
be acquired are collectively, "Wells-Nikko Entities"). Barclays would thereby engage in the following activities:
(1) Performing functions or activities that may be performed by a trust company in accordance with 12 C.F.R.
225.25(b)(3);
(2) Providing investment advisory services in accordance with 12 C.F.R. 225.25(b)(4);
(3) Providing securities brokerage services in accordance with 12 C.F.R. 225.25(b)(15);
(4) Providing advisory services, including discretionary
portfolio management services, with respect to futures
and options on futures on financial commodities;
(5) Providing administrative services to open-end and
closed-end investment companies; 1 and
(6) Providing employee benefits consulting services. 2
Barclays would reorganize and rename the Wells-Nikko
Entities, and provide the proposed services through BZW
Barclays Global Investors, N.A. ("BZW Trust"), and two
operating subsidiaries of BZW Trust, BZW Barclays
Global Fund Advisors and BZW Barclays Global Investors
Services, all of San Francisco, California (collectively,
"BZW Entities").
Notice of the proposal, affording interested persons an
opportunity to submit comments, has been published (60
Federal Register 54,373 (1995)). The time for filing comments has expired, and the Board has considered the notice
and all comments received in light of the factors set forth
in section 4 of the BHC Act.
Barclays, with total consolidated assets of $265 billion, 3
operates in the United States through Barclays Bank of
New York, N.A., New York, New York; branches in Chicago, Illinois, and New York, New York; an agency in
Miami, Florida; and representative offices in San Francisco, California, and Washington, D.C. Barclays also engages in a number of nonbanking activities in the United
States.
BZW Barclays Global Investors Services would be a
broker-dealer registered with the Securities and Exchange
Commission ("SEC") under the Securities Exchange Act
of 1934 (15 U.S.C. § 78a et seq.). BZW Global Investors
Services, therefore, would be subject to the recordkeeping
and reporting obligations, fiduciary standards, and other
requirements of the Securities Exchange Act of 1934 and
the SEC. BZW Barclays Global Fund Advisors would be
an investment advisor registered with the SEC under the
Investment Advisers Act of 1940 (15 U.S.C. § 80b-1
et seq.) and a commodity trading advisor registered with
the Commodity Futures Trading Commission ("CFTC")
under the Commodity Exchange Act (7 U.S.C. § 2 et seq.).
BZW Barclays Global Fund Advisors would be subject to
1. The administrative services that Barclays would provide to investment companies include computing net asset values and performance
data, coordinating communications and activities between the investment advisor and the other service providers, accounting and recordkeeping, disbursing payments for fund expenses, arranging office
space, and preparing and filing regulatory reports. A list of the
proposed administrative services is included in the Appendix. Barclays also would provide telephone services to shareholders through a
toll-free 800 number. Barclays has committed that telephone service
operators will not solicit callers to purchase shares in particular
mutual funds, and that substantive questions about mutual fund performance or strategies will be referred to specific mutual fund distributors or investment advisors. See The Chase Manhattan Corporation,
80 Federal Reserve Bulletin 883 (1995).
2. Barclays also has provided notice to provide subaccounting for
individual funds in pooled escrow accounts maintained at banks and
other financial institutions and to provide clients with industry-wide
salary surveys in accordance with 12 C.F.R. 225.25(b)(4) & (7). See
Norstar Bancorp, Inc., 72 Federal Reserve Bulletin 729 (1986)
("Norstar").
3. Asset data are as of June 30, 1995, and use exchange rates then in
effect.
Legal Developments
the recordkeeping and reporting obligations, fiduciary standards, and other requirements of the Investment Advisers
Act of 1940, the Commodity Exchange Act, the SEC, and
the CFTC.
Glass-Steagall
Act
Under the Glass-Steagall Act, a company that owns a
member bank may not control "through stock ownership
or in any other manner" a company that engages principally in distributing, underwriting or issuing securities. 4
The Board previously has determined that the GlassSteagall Act does not prohibit a bank holding company
from serving as investment advisor to a mutual fund. 5
The Board also has previously determined that a bank
holding company may provide administrative services to a
mutual fund, consistent with the provisions of the GlassSteagall Act. 6 In Mellon, the Board found that a mutual
fund administrator provides services that are primarily
ministerial or clerical in nature, and that the policymaking
functions rest with the board of directors of the fund, which
is responsible for the selection and review of the major
contractors to the fund. The Board also determined that
providing a combination of administrative and advisory
services to a mutual fund would not involve a bank holding
company in the distribution of securities.
Barclays has committed that it will not have any director,
officer or employee interlocks with proprietary mutual
funds to which it provides administrative services. 7 This
commitment reinforces the independence of the board of
the fund, which would have authority to remove Barclays
as administrator of the fund at its discretion. In addition,
the BZW Entities would not be involved in the distribution
of the shares of any mutual fund. Under these circumstances, the Board believes that control of the proprietary
mutual funds would continue to rest with the boards of
directors of the funds, which would be entirely independent of Barclays, and that the proposal by Barclays to
provide clerical and ministerial services as administrator to
4. 12 U.S.C. § § 2 2 l a and 377.
5. 12 C.F.R. 225.25(b)(4); 12 C.F.R. 225.125. The Board also found
that the prohibitions of the Glass-Steagall Act do not apply to a
closed-end fund that is not engaged frequently in the issuance, sale or
distribution of securities. On this basis, the Board has by regulation
authorized bank holding companies to sponsor, organize, and manage
closed-end funds. 12 C.F.R. 225.25(b)(4)(H). A closed-end fund that is
controlled by a bank holding company must conform its activities and
investments to the requirements of section 4 of the BHC Act. If
Barclays sponsors, organizes, or controls any closed-end fund, therefore, Barclays must limit any such fund's investments to less than
5 percent of the voting shares of any issuer.
6. Mellon Bank Corporation, 79 Federal Reserve Bulletin 626
(1993) ("Mellon").
7. In this case, "proprietary mutual funds" refers to those mutual
funds that are primarily sold to customers of Barclays. With respect to
non-proprietary funds, Barclays would only permit those limited
interlocks approved by the Board in Mellon. Barclays has not proposed to have any director, officer or employee interlocks between
mutual funds and the BZW Entities.
159
these funds would not cause Barclays to control the funds
or to become involved in the distribution of securities. 8
In providing the proposed combination of services to
mutual funds, Barclays and the BZW Entities also would
be subject to the restrictions set forth in the Board's interpretive rule on investment advisory activities (12 C.F.R.
225.125). The rule requires any bank holding company that
acts as agent in the purchase or sale of shares of an
investment company advised by a holding company affiliate or recommends the purchase or sale of such shares to
any customer to disclose to the customer in writing the role
of the bank holding company and its affiliates with the
investment company. In addition, the bank holding company must disclose in writing that the shares of the investment company are not federally insured, are not deposits,
and are not obligations of, or guaranteed by, any bank.
The interpretive rule also precludes an investment company advised by a bank holding company from having a
name that is similar to, or a variation of, the name of any
bank holding company or any of its subsidiary banks. 9 The
Board's rule also prohibits a bank holding company from
owning shares of any mutual fund that it advises, from
purchasing shares of these mutual funds in a fiduciary
capacity in its sole discretion, and from lending to any such
fund or accepting shares of such funds as collateral for any
loan for the purpose of acquiring shares of the fund.
Barclays has stated that it would abide by these restrictions.
Based on all of the facts of record, and subject to the
commitments made by Barclays and its compliance with
the Board's interpretive rule, the Board believes that Barclays's proposal to provide both investment advisory and
administrative services to the mutual funds is not prohibited by the Glass-Steagall Act.
Bank Holding Company Act
The Board previously has determined by order that the
proposed employee benefits consulting services, futuresrelated discretionary portfolio management services, and
mutual fund administration services are closely related to
banking. 10 The Board also has determined by regulation
8. Barclays has committed not to engage in advertising activities on
behalf of mutual funds that it administers. Barclays has proposed to
prepare, at the direction and under the supervision of the fund's
distributor, sales literature for funds it administers. The ultimate
responsibility for use of the fund's sales literature would remain with
the distributor, which would be responsible for filing advertisements
and sales literature with the National Association of Securities Dealers
and for all decisions related to marketing the mutual fund and arranging for brokers to distribute the fund's shares. Barclays will not
engage in the development of marketing plans for mutual funds except
to give advice to a fund's distributor on regulatory compliance. The
proposed sales literature preparation activities are primarily ministerial in nature, and based on all the facts of record and the representations made by Barclays, the Board believes not prohibited by the
Glass-Steagall Act.
9. 12 C.F.R. 225.125(f).
10. See CS Holding, 81 Federal Reserve Bulletin 803 (1995);
Norstar; Mellon.
160
Federal Reserve Bulletin • February 1996
that the other proposed activities are closely related to
banking. 11 Barclays has stated that it would engage in these
activities in accordance with the Board's regulations, orders and related interpretations.
In order to approve this proposal, the Board also must
find that the performance of the proposed activities by the
BZW Entities "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 expects that consummation of this proposal
would provide added convenience and services to the customers of Barclays by offering them an expanded range of
products and investment management expertise. In addition, the Board previously has determined that the provision of administrative services to mutual funds within
certain parameters is not likely to result in the types of
subtle hazards at which the Glass-Steagall Act is aimed or
any other adverse effects. There is no evidence in the
record to indicate that consummation of this proposal,
subject to the commitments noted above, would result in
significant adverse effects, such as undue concentration of
resources, decreased or unfair competition, conflicts of
interests, or unsound banking practices, that are not outweighed by the expected public benefits of the proposal.
In every case under section 4(c)(8) of the BHC Act, the
Board considers the financial and managerial resources of
the applicant and its subsidiaries and the effect the transaction would have on those resources. 12 In considering these
factors, the Board notes that the capital ratios of Barclays
meet applicable risk-based capital standards under the
Basle Accord, and are considered equivalent to the capital
levels that would be required of a U.S. banking organization. On the basis of all the facts of record, including the
foregoing, the Board has concluded that financial and
managerial considerations are consistent with approval of
this proposal.
On the basis of the foregoing and all the other facts of
record, including the commitments made by Barclays, the
Board has determined that the performance of the proposed
activities by the BZW Entities can reasonably be expected
to produce benefits to the public that would outweigh any
possible adverse effects under the proper incident to banking standard of section 4(c)(8) of the BHC Act.
Based on the foregoing and all the facts of record,
including all the commitments and representations made
by Barclays in this case, and subject to all the terms and
conditions set forth in this order, the Board has determined
that the notice should be, and hereby is, approved. The
Board's determination is subject to all the conditions set
forth in the Board's Regulation Y, including those in sections 225.7 and 225.23(g) of Regulation Y (12 C.F.R.
11. See 12 C.F.R. 225.25(b)(3), (4), (7), (15) & (19).
12. 12 C.F.R. 225.24; The Fuji Bank, Limited, 75 Federal
Bulletin 94 (1989); Bayerische Vereinsbank AG, 73 Federal
Bulletin 155 (1987).
Reserve
Reserve
225.7 and 225.23(g)), and to the Board's authority to
require modification or termination of the activities of a
bank holding company or any of its subsidiaries as the
Board finds necessary to assure compliance with, and to
prevent evasion of, the provisions of the BHC Act and the
Board's regulations and orders issued thereunder. The
Board's decision is specifically conditioned on Barclays's
compliance with all the commitments and representations
made in connection with this application, including the
commitments and conditions discussed in this order. The
commitments, representations, and conditions relied on in
reaching this decision shall be deemed to be conditions
imposed in writing by the Board in connection with its
findings and decision and, as such, may be enforced in
proceedings under applicable law.
This transaction shall not be consummated later than
three months after the effective date of this order, unless
such period is extended for good cause by the Board or by
the Federal Reserve Bank of New York, acting pursuant to
delegated authority.
By order of the Board of Governors, effective December 21, 1995.
Voting for this action: Chairman Greenspan and Governors Kelley,
Lindsey, Phillips, and Yellen. Absent and not voting: Vice Chairman
Blinder.
JENNIFER J. JOHNSON
Deputy Secretary of the Board
Appendix A
List of Administrative
Services
(1) Maintaining and preserving the records of the fund,
including financial and corporate records;
(2) Computing net asset value, dividends, performance
data and financial information regarding the fund;
(3) Furnishing statistical and research data;
(4) Preparing and filing with the SEC and state securities
regulators registration statements, notices, reports and other
material required to be filed under applicable laws;
(5) Preparing reports and other informational materials
regarding the fund including proxies and other shareholder
communications and reviewing prospectuses;
(6) Providing legal and regulatory advice to the fund in
connection with its other administrative functions;
(7) Providing office facilities and clerical support for the
fund;
(8) Developing and implementing procedures for monitoring compliance with regulatory requirements and compliance with the fund's investment objectives, policies, and
restrictions as established by the fund's board;
(9) Providing routine fund accounting services and liaison
with outside auditors;
(10) Preparing and filing tax returns;
(11) Reviewing and arranging for payment of fund expenses;
Legal Developments
(12) Providing communication and coordination services
with regard to the fund's investment advisor, transfer agent,
custodian, distributor and other service organizations that
render recordkeeping or shareholder communication services;
(13) Reviewing and providing advice to the distributor, the
fund and investment advisor regarding sales literature and
marketing plans to assure regulatory compliance;
(14) Providing information to the distributor's personnel
concerning fund performance and administration;
(15) Participation in seminars, meetings, and conferences
designed to present information to brokers and investment
companies, but not in connection with the sale of shares of
the funds to the public, concerning the operations of the
funds, including administrative services provided by Barclays to the funds;
(16) Assisting existing funds in the development of additional portfolios;
(17) Providing reports to the fund's board with regard to its
activities; and
(18) Providing telephone shareholder services through a
toll-free 800 number.
Deutsche Bank AG
Frankfurt, Germany
Order Approving an Application to Engage in Certain
Precious Metal, Futures Commission Merchant, and
Financing Activities
Deutsche Bank AG, Frankfurt, Germany ("Deutsche
Bank"), a foreign banking organization subject to the
provisions of the Bank Holding Company Act ("BHC
Act"), has applied under section 4(c)(8) of the BHC Act
(12 U.S.C. § 1843(c)(8)) and section 225.23 of the Board's
Regulation Y (12 C.F.R. 225.23) to retain Deutsche Bank
Sharps Pixley, Inc. ("DBSPI") and Deutsche Sharps Pixley Metals, Inc. ("Metals"), both of New York, New York,
and thereby engage in trading gold, silver and platinum
bullion in the spot, forward and option markets for nonhedging purposes, 1 providing financing services, and acting as an introducing broker and providing futures commission merchant ( " F C M " ) execution and advisory services
with respect to futures and options on futures on certain
financial and non-financial commodities. 2
Notice of the application, affording interested persons an
opportunity to submit comments, has been published (59
1. DBSPI arranges for precious metal forward and option transactions between Deutsche Bank's New York branch ("DBNY") and
unaffiliated counterparties. When a precious metal transaction is entered into with a customer, DBNY enters into an offsetting transaction
with DBSPI, which enters into futures, options and options on futures
transactions in accordance with 12 C.F.R. 225.142.
2. DBSPI would not provide advisory services with respect to gold,
silver, or platinum. Deutsche Bank acquired DBSPI and Metals from
Kleinwort Benson Group pic, London, England, on December 31,
1993, pursuant to section 4(c)(9) of the BHC Act. See Letter dated
November 29, 1993, from Jennifer J. Johnson, Associate Secretary of
the Board, to Eric S. Yoon, Esq.
161
Federal Register 34,623 (1994)). The time for filing comments has expired, and the Board has considered the application and all comments received in light of the factors set
forth in section 4(c)(8) of the BHC Act.
Deutsche Bank, with total consolidated assets equivalent
to approximately $451 billion, is the largest banking organization in Germany. 3 In the United States, Deutsche Bank
operates branches in New York, New York; Chicago, Illinois; and Los Angeles, California. In addition to these
banking operations, Deutsche Bank owns several nonbanking subsidiaries in the United States.
Metals is an FCM registered with the Commodity Futures Trading Commission ("CFTC") and a member of the
National Futures Association ("NFA"). Metals therefore,
is subject to the recordkeeping, reporting, fiduciary standards, and other requirements of the Commodity Exchange
Act (7 U.S.C. § 1 et seq.), the CFTC, and the NFA. 4
The Board previously has determined that the proposed
financing and futures-related activities are closely related
to banking. 5 The Board also previously has determined that
trading gold, silver and platinum bullion in the spot, forward and option markets is closely related to banking. 6
Deutsche Bank has stated that it would conduct the proposed activities in accordance with the Board's regulations
and prior orders.
In order to approve this application, the Board also must
determine that the proposed activities "can reasonably be
expected to produce benefits to the public, 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). The Board expects that Deutsche
Bank's proposal would provide added convenience to its
customers and increase the level of competition among
existing providers of these services.
Deutsche Bank has taken steps to address the potential
adverse effects that could result from the proposed activities. Both Deutsche Bank and DBSPI have substantial
experience in trading gold, silver and platinum bullion.
The Board has carefully reviewed the risk management
policies, procedures, and controls used by Deutsche Bank
and DBSPI in conducting and monitoring precious metal
trading activities. These policies and procedures, which
address the credit, market, and operational risks associated
with the proposed activities, are currently in place and have
3. Asset and ranking data are as of June 30, 1995, and employ
exchange rates then in effect.
4. DBSPI is a clearing member of the Commodity Exchange, Inc.
("COMEX"). DBSPI would maintain a membership on COMEX in
order to purchase and sell futures and options on futures contracts for
affiliates and to trade such contracts for its own account to hedge its
precious metal trading activities.
5. See 12 C.F.R. 225.25 (b)(1) & (19); J.P. Morgan & Co. Incorporated, 80 Federal Reserve Bulletin 151 (1994); Northern Trust, 79
Federal Reserve Bulletin 723 (1993); The Nippon Credit Bank, Ltd.,
75 Federal Reserve Bulletin 308 (1989).
6. See Swiss Bank Corporation, 81 Federal Reserx'e Bulletin 185
(1995).
162
Federal Reserve Bulletin • February 1996
been used in the precious metal trading operations of
Deutsche Bank and DBSPI. Deutsche Bank has committed
that DBSPI will adopt and periodically review and revise
written policies, position limits, internal review procedures, and financial controls for its precious metal trading
activities. In addition, management of DBPSI will review
the precious metal trading activities regularly, and the
internal audit department will review such activities to
ensure conformity with established policies and position
limits. The Board believes that the controls and limitations
established by Deutsche Bank and DBSPI should minimize
the potential adverse effects involved in the proposed activities.
In every case under section 4(c)(8) of the BHC Act, the
Board considers the financial and managerial resources of
the applicant and its subsidiaries and the effect the transaction would have on those resources. 7 In considering these
factors, the Board notes that Deutsche Bank's capital ratios
meet applicable risk-based capital standards under the
Basle Accord, and are considered equivalent to the capital
levels that would be required of a U.S. banking organization. On the basis of all the facts of record, including the
foregoing, the Board has concluded that financial and
managerial considerations are consistent with approval of
this proposal.
On the basis of the foregoing and all the other facts of
record, the Board has concluded that the balance of public
interest factors it is required to consider under section
4(c)(8) of the BHC Act is favorable. The Board has determined, therefore, that the proposed activities are a proper
incident to banking within the meaning of the BHC Act.
Based on the foregoing and all the facts of record,
including all the representations and commitments made
by Deutsche Bank in this case, the Board has determined
to, and hereby does, approve the application subject to all
the terms and conditions set forth in this order, and in the
above-noted Board regulations and orders that relate to
these activities. The Board's determination also is subject
to all the terms and conditions set forth in the Board's
Regulation Y, including those in sections 225.7 and
225.23(g), and to the Board's authority to require such
modification or termination of the activities of a bank
holding company or any of its subsidiaries as the Board
finds necessary to assure compliance with, and to prevent
evasion of, the provisions of the BHC Act and the Board's
regulations and orders issued thereunder. The Board's decision is specifically conditioned on compliance with all the
commitments made by Deutsche Bank in this application,
including the commitments discussed in this order and the
conditions set forth in this order and in the above-noted
Board regulations and orders. For purposes of this action,
these commitments and conditions shall be deemed to be
conditions imposed in writing by the Board in connection
7. 12 C.F.R. 225.24; The Fuji Bank, Limited, 75 Federal
Bulletin 94 (1989); Baverische Vereinsbank AG, 73 Federal
Bulletin 155 (1987).
Reserve
Reserve
with its findings and decisions, 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 New York, pursuant to delegated authority.
By order of the Board of Governors, effective December 13, 1995.
Voting for this action: Chairman Greenspan, Vice Chairman
Blinder, and Governors Kelley, Lindsey, Phillips, and Yellen.
JENNIFER J. JOHNSON
Deputy Secretary of the Board
Firstar Corporation
Milwaukee, Wisconsin
Firstar Corporation of Iowa
Des Moines, Iowa
Order Approving the Acquisition
Association
of a Savings
Firstar Corporation, Milwaukee, Wisconsin, and Firstar
Corporation of Iowa, Des Moines, Iowa together,
("Firstar"), bank holding companies within the meaning of
the Bank Holding Company Act ("BHC Act"), have filed
notice pursuant to section 4(c)(8) of the BHC Act
(12 U.S.C. § 1843(c)(8)) and section 225.23(a) of the
Board's Regulation Y (12 C.F.R. 225.23(a)) to acquire all
the voting shares of Harvest Financial Corp., and thereby
indirectly acquire its wholly owned subsidiary, Harvest
Savings Bank, a Federal Savings Bank, ("Savings Bank"),
both of Dubuque, Iowa. 1
Notice of the proposal, affording interested persons an
opportunity to submit comments, has been published (60
Federal Register 55,717 (1995)). The time for filing comments has expired, and the Board has considered the notice
and all comments received in light of the factors set forth
in section 4(c)(8) of the BHC Act.
The Board has determined that the operation of a savings
association is closely related to banking for purposes of
section 4(c)(8) of the BHC Act. 2 The Board requires savings associations acquired by bank holding companies to
conform their direct and indirect activities to those permissible for bank holding companies under section 4(c)(8) of
the BHC Act and Regulation Y. Firstar has committed to
1. In connection with the proposal, Firstar has applied to acquire
options to purchase up to 19.9 percent of the stock of Savings Bank.
These options would become moot upon consummation of this proposal.
2. See 12 C.F.R 225.25(b)(9).
Legal Developments
conform all activities of Savings Bank to those requirements. 3
Firstar, with total consolidated assets of $18.6 billion,
operates subsidiary banks in Arizona, Illinois, Iowa, Minnesota, and Wisconsin. 4 Firstar is the second largest depository institution in Iowa, controlling deposits of approximately $2 billion, representing approximately 5.6 percent
of total deposits in depository institutions in the state. 5
Harvest Financial Corp. is the 26th largest depository
institution in Iowa, controlling deposits of $231 million,
representing less than 1 percent of total deposits in depository institutions in the state. Upon consummation of this
proposal, Firstar would remain the second largest depository institution in Iowa, controlling deposits of $2.2 billion,
representing approximately 6.3 percent of total deposits in
depository institutions in the state.
Firstar and Savings Bank do not compete directly in any
banking market. Based on all the facts of record, the Board
has concluded that consummation of this proposal would
not result in any significantly adverse effect on competition
or the concentration of banking resources in any relevant
banking market.
Convenience and Needs
Considerations
In considering a notice to acquire a savings association
under section 4 of the BHC Act, the Board reviews the
records of performance of the relevant depository institutions under the Community Reinvestment Act (12 U.S.C.
§ 2901 et seq.) ("CRA"). The CRA requires the federal
financial supervisory agencies to encourage financial institutions to help meet the credit needs of the local communities in which they operate, consistent with their safe and
sound operation. To accomplish this end, the CRA requires
the appropriate federal supervisory authority to "assess the
institution's record of meeting the credit needs of its entire
community, including low- and moderate-income neighborhoods, consistent with the safe and sound operation of
such institution," and to take that record into account in its
evaluation of bank holding company applications. 6
The Board has received comments on this notice from
the Wisconsin Rural Development Center, Inc. ("Protestant"). Protestant maintains that individual Firstar subsidiary banks in Wisconsin have not met the credit needs of
the farming community, as evidenced by low ratios of
agricultural loans to total loans, compared to other lenders
in their service areas, and by their limited participation in
government-guaranteed agricultural loan programs. Protestant also contends that the consolidation of agricultural
lending activity into Firstar Agri Financial Services ("Agri-
3. Firstar has committed that any impermissible securities or insurance activities conducted by Savings Bank or its subsidiaries will
cease on or before consummation.
4. Asset data are as of June 30, 1995.
5. State deposit data are as of June 30, 1994. In this context,
depository institutions include commercial banks, savings banks, and
savings institutions.
6. 12 U.S.C. § 2903.
163
Financial") favors large farm operations at the expense of
small- to medium-sized family farms, by reducing the
number and availability of loans to smaller farms and by
limiting the amount of staff and services available to assist
in meeting their credit needs. 7
The Board has carefully reviewed the CRA performance
records of Firstar and its subsidiaries and Savings Bank, all
comments received on this application, Firstar's responses
to those comments, and all other relevant facts of record, in
light of the CRA, the Board's regulations, and the Statement of the Federal Financial Supervisory Agencies Regarding the Community Reinvestment Act ("Agency CRA
Statement"). 8
Record of Performance
Under the CRA
The Agency CRA Statement provides that a CRA examination is an important and often controlling factor in the
consideration of an institution's CRA record and that reports of these examinations will be given great weight in
the applications process. 9 The Board notes that all of
Firstar's subsidiary banks received either a "satisfactory"
or "outstanding" rating from their primary federal supervisor, in their most recent examination for CRA performance. Of the 14 Firstar subsidiary banks serving Wisconsin, for example, ten received a CRA performance rating of
"outstanding" 10 and four received a CRA performance
rating of "satisfactory" at their most recent examination
(collectively, the "Wisconsin Examinations"). 11 Savings
Bank received an "outstanding" rating from its primary
federal supervisor, the Office of Thrift Supervision, as of
May 1995.
The Wisconsin Examinations found that Firstar's subsidiary banks offer a variety of housing-related loans, small
7. Protestant also alleged, without providing specific facts, that one
borrower was threatened with foreclosure if he criticized a bank, and
that Firstar subsidiary banks are not complying with commitments to
restructure loans or extend credit for expansion in several cases. The
Board notes that these complaints have been referred to the primary
federal supervisors of the relevant banks for consideration. If a Firstar
bank has breached a legal obligation arising out of an individual loan
transaction, a court can provide the borrower with adequate remedies,
if allegations of such a breach can be substantiated.
8. 54 Federal Register 13,742 (1989).
9. Id. at 13,745.
10. These banks and examination dates are: Firstar Bank Milwaukee, N.A., Milwaukee (Office of the Comptroller of the Currency
("OCC"), as of October 1995); Firstar Bank Appleton, Appleton
(Federal Deposit Insurance Corporation ("FDIC"), as of December
1993); Firstar Bank Fond du Lac, N.A., Fond du Lac (OCC, as of
March 1995); Firstar Bank Grantsburg, N.A., Grantsburg (OCC, as of
April 1995); Firstar Bank Green Bay, Green Bay (FDIC, as of May
1994); Firstar Bank Madison, N.A., Madison (OCC, as of May 1995);
Firstar Bank Manitowoc, Manitowoc (FDIC, as of March 1995);
Firstar Bank Minocqua, Minocqua (FDIC, as of May 1995); Firstar
Bank Sheboygan, Sheboygan (OCC, as of June 1994); Firstar Bank
Wisconsin Rapids, N.A., Wisconsin Rapids (OCC, as of July 1995).
11. The banks and examination dates are: Firstar Bank Eau Claire,
N.A., Eau Claire (OCC, as of May 1995); Firstar Bank OshKosh,
N.A., OshKosh (OCC, as of March 1995); Firstar Bank Rice Lake,
N.A., Rice Lake (OCC, as of May 1993); Firstar Bank Wausau, N.A.,
Wausau (OCC, as of June 1995).
164
Federal Reserve Bulletin • February 1996
business loans, and community development activities to
assist in meeting the credit needs of their entire communities, including low- and moderate-income neighborhoods.
The banks offer loan programs designed for low- and
moderate-income buyers, such as the Community Home
Works Program that features low down payment, low cost,
fixed-rate mortgages with flexible underwriting criteria. In
addition, Firstar subsidiary banks make governmentsponsored loans through programs sponsored by the Federal Housing Administration and the Veterans Administration. The banks also make small business loans through
programs of the Small Business Administration. 12 Firstar
subsidiary banks also engage in a wide range of community development activities that include financing for the
construction of housing and rental units for low- and
moderate-income residents, participations in statesponsored business development funds, and financial assistance to businesses owned by minorities.
Firstar engages in agricultural lending through proprietary and government-guaranteed lending programs, and
its level of agricultural lending has increased by approximately $65 million since 1992. As of October 31, 1995,
Firstar's subsidiary banks had 1,227 agricultural loans outstanding totalling approximately $182.7 million, 13 and a
government-guaranteed loan portfolio consisting of 285
loans, totalling approximately $36.5 million. The average
loan size in its agricultural portfolio is approximately
$150,000. 14
Agri-Financial is not a consolidated agricultural lending
program but is a trademark name established in 1994 that
is currently used by Firstar Bank Manitowoc, Manitowoc,
Wisconsin ("Manitowoc Bank"). 1 5 Firstar intends to
merge all its Wisconsin subsidiary banks into a single
Wisconsin bank ("Firstar Bank Wisconsin") in 1996 and
to appoint the president of Manitowoc Bank as the head of
the new bank's agricultural lending division. When the
reorganization is complete, the agricultural division will
have 14 agricultural loan officers available at eight offices
throughout the state, who would be supported by two
specialists in government-guaranteed loans. Firstar asserts
that this structure would increase efficiency and result in
better service by and greater accessibility to loan officers
because the administrative support and expertise to be
12. Firstar's lead subsidiary bank in Milwaukee also developed the
Elan Small Business Line of Credit, a program that provides financing
in amounts less than $25,000 for businesses with annual sales of less
than $1 million.
13. Firstar's June 30, 1995, Bank Holding Company Performance
Report showed that agricultural loans equalled 1.57 percent of its
gross loans, compared to 0.58 percent for its peer group.
14. Firstar also estimates that 95 percent of the loans in its agricultural portfolio are to farms or agricultural businesses with sales of less
than $500,000.
15. As discussed above, Manitowoc Bank, Firstar's primary agricultural lender in Wisconsin, received an "outstanding" CRA performance rating, as of March 1995. Examiners noted that the bank made
149 guaranteed loans through the Farmers Home Administration (now
the Farm Service Agency), totalling approximately $21.9 million, and
19 Wisconsin Housing and Economic Development Authority Crop
loans, totalling $282,000.
provided by the former Manitowoc Bank would permit the
loan officers to devote more efforts to soliciting and receiving applications for agricultural loans.
The Board has carefully considered Protestant's comments, information provided by Firstar, and the Wisconsin
Examinations in evaluating Firstar's record of CRA performance. Based on this review, the Board concludes that the
CRA performance record of Firstar's subsidiary banks,
including their record of making agricultural loans in Wisconsin, is consistent with approval of this proposal.
Other
Considerations
The Board also concludes that the financial and managerial
resources and future prospects of the institutions involved,
are consistent with approval.
The record also indicates that consummation of this
proposal would result in increased services and products
for Savings Bank's customers and access to Firstar's entire
banking network in Wisconsin as well as economies of
scale and benefits to Firstar's customers. The Board also
finds that consummation of this proposal is not likely to
result in any significantly adverse effects, such as undue
concentration of resources, decreased or unfair competition, conflicts of interests, or unsound banking practices
that would outweigh the public benefits of this proposal.
Accordingly, the Board has determined that the balance of
public interest factors it must consider under section 4(c)(8)
of the BHC Act is favorable and consistent with approval.
Based on the foregoing and all the facts of record, the
Board has determined that this transaction should be, and
hereby is, approved. 16 The Board's approval of this proposal is specifically conditioned on compliance by Firstar
with all the commitments made in connection with this
proposal.
The Board's determination is subject to all the conditions set forth in Regulation Y, including those in sections
225.7 and 225.23(b)(3) of Regulation Y (12 C.F.R. 225.7
and 225.23(b)(3)), and to the Board's authority to require
16. Protestant has requested that the Board hold a public meeting or
hearing on this application. The Board's rules for processing applications provide that a hearing is required under section 4 of the BHC
Act only if there are disputed issues of material fact that cannot be
resolved in some other manner. 12 C.F.R. 225.23(g). 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). Protestant has had an opportunity to present its views, and
has submitted substantial written comments that have been considered
by the Board. After careful review of all the facts of record, the Board
believes that Protestant's request disputes the weight accorded to, and
the conclusions that may be drawn from, the facts of record, and does
not identify disputed issues of fact that are material to the Board's
decision. Protestant's request also fails to show why a written presentation would not suffice and to summarize what evidence would be
presented at a hearing or meeting. See 12 C.F.R. 262.3(e). In light of
the record in this case, the Board does not believe that a hearing or
meeting is necessary to clarify the factual record or is otherwise
required or wan-anted. Accordingly the request for a public meeting or
hearing on this notice is hereby denied.
Legal Developments
such modification or termination of the activities of a bank
holding company or any of its subsidiaries as the Board
finds necessary to ensure compliance with, and to prevent
evasion of, the provisions of the BHC Act and the Board's
regulations and orders issued thereunder. The commitments and conditions relied on by the Board in reaching
this decision are deemed to be conditions imposed in
writing by the Board in connection with its findings and
decision, and, as such, may be enforced in proceedings
under applicable law.
This transaction shall not be consummated later than
three months following 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, acting pursuant to delegated authority.
By order of the Board of Governors, effective December 11, 1995.
Voting for this action: Chairman Greenspan, and Governors Lindsey, Phillips, and Yellen. Absent and not voting: Vice Chairman
Blinder and Governor Kelley.
JENNIFER J. JOHNSON
Deputy Secretary of the Board
Wells Fargo & Company
San Francisco, California
Order Approving Notice to Engage in Certain
Activities
Lending
Wells Fargo & Company, San Francisco, California
("Wells Fargo"), a bank holding company within the
meaning of the Bank Holding Company Act ("BHC Act"),
has given notice pursuant to section 4(c)(8) of the BHC
Act (12 U.S.C. § 1843(c)(8)) and section 225.23 of the
Board's Regulation Y (12 C.F.R. 225.23), to engage
de novo through its wholly owned subsidiary, Wells Fargo
Equity Capital, Inc., San Francisco, California ("Company"), in certain commercial lending activities pursuant to
section 225.25(b)(1) of Regulation Y (12 C.F.R.
225.25(b)(1)). Company would conduct these activities
throughout the United States.
Notice of this proposal, affording interested persons an
opportunity to submit comments, has been published (60
Federal Register 13,986 (1995)). The time for filing comments has expired, and the Board has considered the notice
and all comments received in light of the factors set forth
in section 4(c)(8) of the BHC Act.
Wells Fargo, with total consolidated assets of
$50.9 billion, is the 17th largest commercial banking organization in the United States, and it operates bank subsidiaries in Arizona and California. 1 Wells Fargo engages
through its subsidiaries in a broad range of banking and
permissible nonbanking activities.
1. Asset data are as of June 30, 1995. Ranking data are as of
October 26, 1995.
165
Wells Fargo would engage through Company in commercial lending, as well as in the servicing of commercial
loans, both for itself and others. The Board previously has
determined by regulation that these activities are closely
related to banking. 2
In every case involving a nonbanking proposal by a bank
holding company to engage in nonbanking activities under
section 4(c)(8) of the BHC Act, the Board considers the
financial and managerial resources of the applicant and its
subsidiaries and the effect of the proposal on those resources. 3 Based on all the facts of record, the Board has concluded that financial and managerial considerations are
consistent with approval of this proposal.
In order to approve this proposal under section 4(c)(8) of
the BHC Act, the Board also must determine that the
performance of the proposed activities by Wells Fargo
through Company "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 expects that consummation of this proposal would
increase competition among providers of commercial financing services, and would enhance convenience and
service for Wells Fargo's customers. The record does not
indicate, moreover, that consummation of this proposal is
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. Accordingly, the Board has concluded that the balance of the public interest factors it must consider under
2. See 12 C.F.R. 225.25(b)(1). Wells Fargo proposes that Company
engage in two types of financing transactions in which Company
would make an equity investment in the borrower, as well as a senior
or subordinated loan. In some cases, Company's equity interest would
be less than 5 percent of the borrower's total equity (though Company
might also purchase warrants for up to 20 percent of additional
equity). In other cases, Company's equity investment could be as
large as 24.9 percent of the borrower's total equity. In these cases,
however, any loans provided by Company would be limited to less
than 25 percent of the total subordinated debt and less than 25 percent
of the total debt outstanding from all sources to the borrower.
Wells Fargo has made a number of commitments and proposed
other limitations for these investments, including that Company's debt
interests would not be convertible into equity, and that no borrower
would be able to treat any part of a loan as regulatory capital.
Company also would have no agreement to acquire any borrower.
Moreover, Company would have no director, officer, or employee
interlock or other significant relationship with any issuer. Company's
investments also would be made under agreements with provisions
that are designed to ensure compliance with the BHC Act and the
Board's Policy Statement on Nonvoting Equity Investments by Bank
Holding Companies (12 C.F.R. 225.143), including provisions limiting the conversion and transfer of warrants and other convertible
equity securities. On the basis of these and other limitations that
would be imposed by Wells Fargo and all the facts of record, the
Board has determined that the structure and terms of the proposed
transactions appear to be consistent with the BHC Act.
3. See 12 C.F.R. 225.24. See also The Fuji Bank, Limited, 75
Federal Reserve Bulletin 94 (1989); Bayerische Vereinsbank AG, 73
Federal Reserve Bulletin 155 (1987).
166
Federal Reserve Bulletin • February 1996
section 4(c)(8) of the BHC Act is favorable and consistent
with approval of this proposal.
Based on the foregoing and all the other facts of record,
including the commitments by Wells Fargo, the Board has
determined that the notice should be, and hereby is, approved. The Board's approval is specifically conditioned
on compliance with all the commitments made in connection with this notice and with the conditions referred to in
this order. The Board's determination also is subject to all
the terms and conditions set forth in Regulation Y, including those in sections 225.7 and 225.23(g) of Regulation Y,
and to the Board's authority to require such modification or
termination of the activities of a bank holding company or
any of its subsidiaries as the Board finds necessary to
ensure compliance with, and to prevent evasion of, the
provisions of the BHC Act and the Board's regulations and
orders issued thereunder. For purposes of this action, these
commitments and conditions shall be deemed to be conditions imposed in writing by the Board in connection with
its findings and decision, and, as such, may be enforced in
proceedings under applicable law.
This proposal 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 13, 1995.
Voting for this action: Chairman Greenspan, Vice Chairman
Blinder, and Governors Kelley, Lindsey, Phillips, and Yellen.
JENNIFER J. JOHNSON
Deputy Secretary of the Board
Orders Issued Under Sections 3 and 4 of the Bank
Holding Company Act
The Berens Corporation
Houston, Texas
Berens Delaware, Inc.
Wilmington, Delaware
Order Denying Applications
Companies
to Become Bank Holding
The Berens Corporation, Houston, Texas ("Berens"), and
its wholly owned subsidiary, Berens Delaware, Inc., Wilmington, Delaware (together, "Applicants"), have applied
under section 3(a)(1) of the Bank Holding Company Act
("BHC Act") (12 U.S.C. § 1842(a)(1)) to become bank
holding companies by acquiring all the voting shares of
First National Bank of Dayton, Dayton, Texas ("Bank").
Applicants also filed notices under section 4(c)(8) of the
BHC Act (12 U.S.C. § 1843(c)(8)) and section 225.23 of
the Board's Regulation Y (12 C.F.R. 225.23) to retain all
the voting shares of Berens Credit Corporation, Houston,
Texas ("BCC"), and thereby engage in mortgage and
commercial finance and equipment leasing activities pursuant to sections 225.25(b)(1) and 225.25(b)(5)(i) of Regulation Y (12 C.F.R. 225.25(b)(1) and 225.25(b)(5)(i)).
Notice of this proposal, affording interested persons an
opportunity to submit comments, has been published (60
Federal Register 40,381 (1995)). The time for filing comments has expired, and the Board has considered this
proposal and all comments received in light of the factors
set forth in sections 3 and 4 of the BHC Act.
Berens is currently a shell holding company engaged,
through BCC, in mortgage and commercial financing and
equipment leasing. Neither of the Applicants currently
controls any insured depository institution. Bank is the
809th largest commercial banking organization in Texas,
controlling deposits of approximately $14 million, representing less than 1 percent of the total deposits in commercial banks in the state.'
The Board believes that the financial factors it is required to consider under section 3 of the BHC Act are not
consistent with approval of this proposal. Bank currently is
well capitalized and is owned by persons who are not
affiliated with Applicants. The record indicates, however,
that the financial resources of Berens, which is not currently a bank holding company, are inadequate. Berens and
BCC recently filed for bankruptcy under chapter 11 of the
United States Bankruptcy Code. 2 Berens, which has been
in operation since 1991, has experienced losses in every
year, and is minimally capitalized. Berens had planned to
make a private offering of its common and preferred stock
to raise funds to purchase Bank, to pay expenses of the
transaction, and for other purposes, including the retention
of sufficient funds to be well capitalized upon becoming a
bank holding company. At the time that Berens filed for
bankruptcy, Berens had subscribers planning to acquire an
amount that is significantly less than the amount necessary
to realize those objectives. Accordingly, based on these
considerations and all the other facts of record, the Board
has concluded that considerations relating to the financial
resources of Applicants are not consistent with approval of
this proposal. The Board also notes that the proposed
management of Berens lacks experience in banking, and in
light of Berens's performance and financial condition, the
Board has concluded that considerations relating to the
managerial resources of Applicants are not consistent with
approval.
Berens has refused to provide certain information about
its operations, business plans, and financial condition and
those of BCC that is material to the evaluation of the
factors the Board is required to consider under the BHC
Act. In other instances, responses provided by Berens have
been incomplete. Taking into consideration the record in
this case, the Board concludes that Applicants have failed
to provide adequate assurances that they would make available to the Board such information on the operations and
1. All banking data are as of June 30, 1994.
2. 11 U.S.C. 1101 etseq.
Legal Developments
activities of Applicants and their affiliates as the Board
determines to be appropriate to determine and enforce
compliance with the BHC Act. Accordingly, based on all
the facts of record, the Board has concluded that considerations relating to supervisory factors are not consistent
with approval of this proposal.
The Board has concluded that other factors it is required
to consider under the BHC Act do not lend sufficient
weight to outweigh the adverse considerations discussed
above.
For the foregoing reasons, and based on all the facts of
record, the Board has determined that approval of the
applications under section 3 of the BHC Act is not warranted. For the reasons stated above, the Board also has
determined that approval of the notices under section 4 of
the BHC Act is not warranted, and that the applications and
notices should be, and hereby are, denied.
By order of the Board of Governors, effective December 6, 1995.
Voting for this action: Chairman Greenspan, Vice Chairman
Blinder, and Governors, Kelley, Phillips, and Yellen. Absent and not
voting: Governor Lindsey.
JENNIFER J. JOHNSON
Deputy Secretary of the Board
Boatmen's Bancshares, Inc.
St. Louis, Missouri
Order Approving the Acquisition of a Bank Holding
Company
Boatmen's Bancshares, Inc., St. Louis, Missouri ("Boatmen's"), a bank holding company within the meaning of
the Bank Holding Company Act ("BHC Act"), has applied
under section 3 of the BHC Act (12 U.S.C. § 1842) to
acquire all the voting shares of Fourth Financial Corporation, Wichita, Kansas ("FFC"), and thereby indirectly
acquire its two subsidiary banks, Bank IV, N.A., Wichita,
Kansas, and Bank IV Oklahoma, N.A., Tulsa, Oklahoma. 1
Boatmen's also has given notice under section 4(c)(8) of
the BHC Act (12 U.S.C. § 1843(c)(8)) and section 225.23
of the Board's Regulation Y (12 C.F.R. 225.23) to acquire
FFC's nonbank subsidiaries. 2
1. Boatmen's proposes to acquire FFC through Acquisition Sub,
Inc., St. Louis, Missouri, and to merge Acquisition Sub with FFC.
Acquisition Sub would survive the merger as a second-tier bank
holding company subsidiary of Boatmen's, and has applied under
section 3 of the BHC Act to become a bank holding company.
Boatmen's also has acquired an option to purchase up to 19.9 percent
of the voting shares of FFC, which option would expire on consummation of this proposal.
2. Boatmen's proposes to acquire:
(1) Fourth Financial Insurance Company, Wichita, Kansas, and
thereby engage in the reinsurance of credit life, accident, and health
insurance directly related to extensions of credit by FFC's subsidiary banks pursuant to section 225.25(b)(8) of Regulation Y;
167
Notice of the applications, affording interested persons
an opportunity to submit comments, has been published
(60 Federal Register 52,915 (1995)). The time for filing
comments has expired, and the Board has considered the
applications and all comments received in light of the
factors set forth in sections 3 and 4 of the BHC Act.
Boatmen's, with total consolidated assets of $33.2 billion, is headquartered in Missouri 3 and operates subsidiary
banks and thrift institutions in nine states. 4 FFC, with total
consolidated assets of $7.3 billion, operates subsidiary
banks in Kansas and Oklahoma. Boatmen's is the fourth
largest commercial banking organization in Oklahoma,
controlling deposits of $1.6 billion, representing approximately 5.1 percent of the total deposits in commercial
banking organizations in the state. FFC is the third largest
commercial banking organization in Oklahoma, controlling deposits of $1.9 billion, representing 6.2 percent of
total deposits in commercial banking organizations in the
state. Upon consummation of this proposal, Boatmen's
would become the largest commercial banking organization in Oklahoma, controlling deposits of $3.5 billion,
representing approximately 11.3 percent of total deposits
in commercial banking organizations in the state.
Interstate
Analysis
Section 3(d) of the BHC Act, as amended by Section 101
of the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994, allows the Board to approve an application by a bank holding company to acquire control of a
bank located in a state other than the home state of such a
bank holding company, if certain conditions are met. 5
These conditions are met in this case. 6 In view of all the
(2) Fourth Investment Advisors, Inc., Tulsa, Oklahoma, and thereby
engage in providing portfolio investment advice pursuant to section
225.25(b)(4) of Regulation Y;
(3) Southgate Trust Company, Overland Park, Kansas, and thereby
engage in trust company activities pursuant to section 225.25(b)(3)
of Regulation Y; and
(4) Bank IV Community Development Corporation and Bank IV
Affordable Housing Corporation, both of Wichita, Kansas, and
thereby engage in providing equity and debt investment in corporations or projects designed primarily to promote community welfare
pursuant to section 225.25(b)(6) of Regulation Y. Boatmen's would
engage in these activities nationwide.
3. Boatmen's has reached an agreement with the Missouri Division
of Finance to divest all the Missouri branches of Bank IV, N.A.,
Wichita, Kansas, in order to avoid exceeding the Missouri state limit
on deposits.
4. Asset data are as of September 30, 1995. State deposit data are as
of June 30, 1994.
5. Pub. L. No. 103-328, 108 Stat. 2338 (1994). 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. For purposes of the BHC Act,
the home state of Boatmen's is Missouri.
6. 12 U.S.C. §§ 1842(d)(1)(A) and (B) and 1842(d)(2)(A) and (B).
Boatmen's is adequately capitalized and managed. FFC's subsidiary
bank in Oklahoma has been in existence and continuously operated
for more than five years, the minimum period of time required under
Oklahoma law. Upon consummation, Boatmen's and its affiliates
168
Federal Reserve Bulletin • February 1996
facts of record, the Board is permitted to approve this
proposal under section 3(d) of the BHC Act.
Competitive
Considerations
Boatmen's and FFC compete directly in six banking markets. 7 The Board has carefully considered the effects that
consummation of this proposal would have on competition
in each of these markets in light of all the facts of record,
including the characteristics of the markets, the increase in
the concentration of total deposits in depository institutions 8 in the markets as measured by the HerfindahlHirschman Index ("HHI"), 9 and certain commitments
made by Boatmen's.
The acquisition of FFC by Boatmen's would significantly increase market concentration in the Cherokee
County and Muskogee banking markets. 10 In order to mitigate the potential adverse competitive effects, Boatmen's
has committed to divest certain branches in these markets." Boatmen's has committed to divest its only branch
would control less than 10 percent of the total amount of deposits of
insured depository institutions in the United States, and less than the
applicable state limits on deposits in Kansas and Oklahoma.
7. The banking markets are the Cherokee County, Kay County,
Muskogee County, Oklahoma City, and Tulsa banking markets, all in
Oklahoma, and the Kansas City, Kansas-Missouri banking market.
8. In this context, depository institutions include commercial banks
and savings associations. Market deposit data are as of June 30, 1994.
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). Thus, the
Board has regularly included thrift deposits in the calculation of
market share on a 50-percent weighted basis. See, e.g., First Hawaiian
Inc., 77 Federal Reserve Bulletin 52 (1991).
9. 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. In such markets, the Justice Department is likely to challenge a
merger that increases the HHI by more than 50 points. 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 entities.
10. The Cherokee County banking market ("Cherokee banking
market") is approximated by Cherokee County, Oklahoma, and the
HHI would increase by 889 points to 4148. The Muskogee banking
market is approximated by the Muskogee RMA and the rest of
Muskogee County, Oklahoma, and the HHI would increase by
792 points to 2835.
11. For each market in which Boatmen's has committed to divest
offices, it has committed to execute sales agreements prior to consummation of the acquisition of FFC, and to consummate these divestitures within 180 days of the acquisition of FFC. Boatmen's also has
committed that if it is unsuccessful in completing these divestitures
within 180 days of consummation of this proposal, it will transfer the
unsold branches to an independent trustee with instructions to sell the
branches promptly. See BankAmerica Corporation, 78 Federal Reserve Bulletin 338 (1992); United New Mexico Financial Corpora-
in the Cherokee banking market to a depository institution
that does not currently compete in the market. Accordingly, no change in the HHI or the number of competitors
would occur as a result of this proposal.
Boatmen's also has committed to divest one or more
branches in the Muskogee banking market with deposits
totalling at least $41.1 million to a competitively suitable
acquiror. With this divestiture, the HHI is not expected to
increase more than 236 points to 2279 as a result of this
proposal.
Several factors indicate that the increase in concentration
in the Muskogee banking market as measured by the HHI
tends to overstate the competitive effects of this proposal.
For example, nine competitors would remain in this market, including the largest and fifth largest commercial
banks in Oklahoma. In addition, the Muskogee banking
market is attractive for entry, and banks in the market are
more profitable on average than banks in other non-MSA
banking markets in Oklahoma. 12 The Board also notes the
effect that two credit unions in the Muskogee banking
market, which control approximately 9.6 percent of the
total deposits in depository institutions in the market, have
on competition in this market. 13
Consummation of this proposal in the four remaining
banking markets where Boatmen's and FFC compete
would not exceed the market concentration levels set forth
in the Department of Justice merger guidelines. 14
As in other cases, the Board sought comments from the
United States Attorney General's Office and the Office of
the Comptroller of the Currency ("OCC"), on the competitive effects of this proposal. The Attorney General indicated that this proposal is not likely to have significantly
adverse competitive effects in light of the proposed divestitures, and the OCC did not object to consummation of the
proposal. Based on all the facts of record, including the
proposed divestitures in the Cherokee and Muskogee banking markets and the facts discussed above, 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
markets.
tion, 77 Federal Reserve Bulletin 484 (1991). Furthermore, Boatmen's has committed to submit to the Board, before consummation of
the acquisition, an executed trust agreement acceptable to the Board
stating the terms of the divestiture.
12. The Muskogee banking market includes the most populous
county in Oklahoma that is not part of a Metropolitan Statistical Area
("MSA"), and that is the sixth most populous of the 77 counties in the
state. While non-MSA counties have lost population on average, this
banking market has increased its population from 1990 to 1994.
13. The credit unions have membership requirements that have
permitted approximately 34 percent of the residents in the market to
become members.
14. The HHIs would increase as follows in these markets: Kansas
City, Kansas-Missouri (122 points to 872); Kay County, Oklahoma
(77 points to 1671); Oklahoma City, Oklahoma (105 points to 840);
Tulsa, Oklahoma (130 points to 1263).
Legal Developments
Other
Considerations
The financial and managerial resources and future prospects of Boatmen's, FFC, and their respective subsidiaries
are consistent with approval of this proposal, as are the
other supervisory factors the Board must consider under
section 3 of the BHC Act. Considerations relating to the
convenience and needs of the communities to be served
also are consistent with approval.
Boatmen's also has provided notice to acquire FFC's
subsidiaries engaged in credit-related insurance, trust company, portfolio investment advisory, and community development activities. Section 4(c)(8) of the BHC Act provides
that a bank holding company may, with Board approval,
engage in any activity that the Board determines to be "so
closely related to banking or managing or controlling banks
as to be a proper incident thereto." The Board previously
has determined by regulation that these activities are
closely related to banking and permissible for bank holding
companies under section 4(c)(8) of the BHC Act.' 3 Boatmen's has committed that it will conduct these activities in
accordance with Regulation Y.
In order to approve this proposal, the Board also must
determine that the proposed activities are a proper incident
to banking, that is, that the proposed transaction "can
measurably be expected to produce benefits to the public,
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, or unsound banking practices. 16 This
proposal should enable Boatmen's to provide greater convenience and improved services to its customers and would
not significantly reduce the level of competition among
existing providers of these services. Financial and managerial considerations also are consistent with approval. 17
Based on all the facts of record, there is no evidence in the
record to indicate that consummation of the proposal is
likely to result in any significantly adverse effects, such as
undue concentration of resources, decreased or unfair competition, conflicts of interests, or unsound banking practices, that would not be outweighed by the likely public
benefits of this proposal. Accordingly, the Board has determined that the balance of public interest factors it must
consider under section 4(c)(8) of the BHC act is favorable
and consistent with approval of this proposal.
Based on the foregoing and all the facts of record,
including the commitments discussed above, the Board has
determined to, and hereby does, approve the application
and notices. The Board's approval is specifically conditioned on compliance with the divestitures discussed in this
order and with all commitments made in connection with
this application. The Board's determination also is subject
to all the terms and conditions set forth in Regulation Y,
including those in sections 225.4(d) and 225.23(g) of Reg-
15. 12 C.F.R. 225.25(b)(3),(4),(6) and (8).
16. 12 U.S.C. § 1843(c)(8).
17. See 12 C.F.R. 225.24(b).
169
ulation Y, and to the Board's authority to require such
modification or termination of the activities of a bank
holding company or any of its subsidiaries as the Board
finds necessary to ensure compliance with, and to prevent
evasion of, the provisions of the BHC Act and the Board's
regulations and orders issued thereunder. For purposes of
this action, these commitments and conditions are deemed
to be conditions imposed in writing by the Board in connection with its findings and decision, and, as such, may be
enforced in proceedings under applicable law.
The acquisition of FFC's subsidiary banks shall not be
consummated before the fifteenth calendar day following
the effective date of this order, and the nonbanking transactions shall not be consummated later than three months
following 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 21, 1995.
Voting for this action: Chairman Greenspan, and Governors Kelley,
Lindsey, Phillips, and Yellen. Absent and not voting: Vice Chairman
Blinder.
JENNIFER J. JOHNSON
Deputy Secretary of the Board
First Bank System, Inc.
Minneapolis, Minnesota
Order Approving the Merger of Bank Holding
Companies
First Bank System, Inc., Minneapolis, Minnesota ("FBS"),
a bank holding company within the meaning of the Bank
Holding Company Act ("BHC Act"), has applied under
section 3(a)(5) of the BHC Act (12 U.S.C. § 1842(a)(5)) to
merge with FirsTier Financial, Inc., Omaha, Nebraska
("FirsTier"), 1 and thereby indirectly acquire FirsTier's
subsidiary banks. 2 FBS also has provided notice under
section 4(c)(8) of the BHC Act (12 U.S.C. § 1843(c)(8))
and section 225.23 of the Board's Regulation Y (12 C.F.R.
225.23) to acquire FirsTier's nonbanking subsidiaries and
thereby engage in permissible nonbanking activities. 3
1. In connection with this proposal, FBS also has requested approval to acquire an option to purchase up to 19.9 percent of the
outstanding voting shares of FirsTier. This option would terminate
upon consummation of this proposal.
2. These subsidiary banks are: FirsTier Bank, N.A., Omaha; FirsTier
Bank, N.A., Lincoln; FirsTier Bank. N.A., Scottsbiuff; and FirsTier
Bank, N.A., Norfolk, all in Nebraska; Nevada National Bank, Nevada;
Valley State Bank, Rock Valley; and Security Savings Bank, Williamsburg, all in Iowa.
3. These nonbank subsidiaries are: FirsTier Insurance, Inc., Omaha,
Nebraska, which engages in the sale of credit-related insurance pursuant to section 225.25(b)(8)(i) and (vii) of Regulation Y (12 C.F.R.
225.25(b)(8)(i) and (vii)); FirsTier Mortgage Company, Omaha, Nebraska, which engages in recovery of problem mortgage loans, pursuant to section 225.25(b)(1) of Regulation Y (12 C.F.R. 225.25(b)(1));
170
Federal Reserve Bulletin • February 1996
Notice of this proposal, affording interested persons an
opportunity to submit comments, has been published (60
Federal Register 54,503 (1995)). The time for filing comments has expired, and the Board has considered the application and notice and all comments received in light of the
factors set forth in sections 3 and 4 of the BHC Act.
FBS, with total consolidated assets of $33.5 billion, 4
controls nine depository institutions in Colorado, Iowa,
Illinois, Kansas, Minnesota, Montana, Nebraska, North
Dakota, South Dakota, Wisconsin, and Wyoming. 5
FirsTier, with total consolidated assets of $3.6 billion,
controls seven depository institutions in Iowa and Nebraska. FBS is the fifth largest depository institution organization in Nebraska, controlling total deposits of
$915.6 million, representing 3.8 percent of total deposits in
insured depository institutions in the state. FirsTier is the
second largest depository institution organization in Nebraska, controlling deposits of approximately $2.5 billion,
representing 10.4 percent of total deposits in insured depository institutions in the state. On consummation of this
proposal, FBS would become the second largest depository
institution organization in Nebraska, controlling $3.4 billion in deposits, representing 14.2 percent of total deposits
in insured depository institutions in the state. FBS is the
sixth largest depository institution organization in Iowa,
controlling total deposits of $784.5 million, representing
2.1 percent of total deposits in insured depository institutions in the state. FirsTier is the 19th largest depository
institution organization in Iowa, controlling deposits of
approximately $310 million, representing less than 1 percent of total deposits in insured depository institutions in
the state. On consummation of this proposal, FBS would
become the fifth largest depository institution organization
in Iowa, controlling deposits of $1.1 billion, representing
3 percent of total deposits in insured depository institutions
in the state.
Interstate
Analysis
Section 3(d) of the BHC Act, as amended by Section 101
of the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994, allows the Board to approve an application by a bank holding company to acquire control of a
bank located in a state other than the home state of such a
bank holding company, if certain conditions are met. 6
and Wyoming Trust and Management Company, Gillette, Wyoming,
which engages in fiduciary and asset management services pursuant to
section 225.25(b)(3) and (4) of Regulation Y (12 C.F.R. 225.25(b)(3)
and (4)).
FBS also would acquire two inactive nonbanking subsidiaries of
FirsTier, FirsTier Data and Asset Recovery Company, both of Omaha,
Nebraska. FBS has committed not to engage in activities through
these subsidiaries without the approval of the Federal Reserve System.
4. Deposit data are as of June 30, 1995.
5. In this context, depository institutions include commercial banks,
savings banks, and savings associations with deposits insured by the
Federal Deposit Insurance Corporation.
6. Pub. L. No. 103-328, 108 Stat. 2338 (1994). A bank holding
company's home state is that state in which the operations of the bank
These conditions are met in this case. 7 In view of all the
facts of record, the Board is permitted to approve this
proposal under section 3(d) of the BHC Act.
Competitive
Considerations
FBS and FirsTier compete directly in the Nebraska banking markets of Buffalo County, Omaha/Council Bluffs,
Columbus, and Lincoln. 8 Consummation of this proposal
would not cause the levels of market concentration as
measured by the Herfindahl-Hirschman Index ( " H H I " ) to
exceed the Department of Justice ("DOJ") merger guidelines 9 in any of these banking markets except the Lincoln
banking market. 10
FBS is the seventh largest depository institution in the
Lincoln banking market, controlling $94 million in depos-
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. For purposes of the BHC Act,
the home state of FBS is Minnesota.
7. 12 U.S.C. §§ 1842(d)(1)(A) and (B) and 1842(d)(2)(A) and (B).
FBS is adequately capitalized and adequately managed. FirsTier's
banks have been in existence and continuously operated for the
minimum period of time required under the laws of the states of Iowa
and Nebraska. On consummation, FBS and its affiliates would control
less than 10 percent of the total amount of deposits of insured
depository institutions in the United States, and less than the Nebraska
deposit limit of 14 percent of the total deposits of all banks in
Nebraska plus the total deposits, savings accounts, passbook accounts,
and shares in savings and loan associations and building and loan
associations in Nebraska. In addition, this proposal would not violate
the Iowa deposit limitation that bank holding companies not control
more than ten percent of the sum of total time and demand deposits of
all banks, savings and loan associations, and savings banks in Iowa.
All other requirements of section 3(d) of the BHC Act would also be
met on consummation of this proposal.
8. The Buffalo County banking market is approximated by Buffalo
County, Nebraska.
The Omaha/Council Bluffs banking market is approximated by the
Omaha/Council Bluffs RMA; the contiguous areas east of the Elkhorn
River in Douglas County, Nebraska; and Pottawattamie County, Iowa,
except for the eastern two tiers of townships.
The Columbus banking market is approximated by all of Platte
County; the eastern quarter of Nance County, including the town of
Genoa; the southern two-thirds of Colfax County, including the town
of Schuyler; the northwestern quadrant of Butler County, including
the towns of Bellwood, David City, and Rising City; the northeastern
half of Polk County, including the town of Shelby; and the extreme
northeastern part of Merrick County, including the town of Silver
Creek.
The Lincoln, Nebraska, banking market is approximated by Lancaster County, Nebraska.
9. Market data are as of June 30, 1994. Market share data before
consummation are based on calculations in which the deposits of thrift
institutions are included at 50 percent. The Board previously has
indicated that thrift institutions have become, or have the potential to
become, significant competitors of commercial banks. See WM Bancorp, 76 Federal Reserve Bulletin 788 (1990); National City Corporation, 70 Federal Reserve Bulletin 743 (1984). Thus, the Board has
regularly included thrift deposits in the calculation of market share on
a 50-percent weighted basis. See, First Hawaiian Inc., 77 Federal
Reserve Bulletin 52 (1991).
10. These markets and the HHI increases are as follows: Buffalo
City (27 points to 2296); Omaha (242 points to 1778); and Columbus
(22 points to 2049).
Legal Developments
its, representing approximately 3.9 percent of total deposits
in depository institutions in the market ("market deposits"). FirsTier is the second largest depository institution in
the market, controlling deposits of $707 million, representing approximately 28.8 percent of market deposits. Upon
consummation of this proposal, FBS would become the
largest depository institution in the market, controlling
deposits of $801 million, representing approximately
32.7 percent of market deposits. The concentration in the
market as measured by the HHI would increase by
222 points to 2207 points as a result of this proposal. 11
A number of additional factors indicate, however, that
the increase in concentration levels in the Lincoln banking
market, as measured by the HHI, tends to overstate the
competitive effects of this proposal. For example, 18 competitors would remain in the market after consummation of
this proposal, including a depository institution that controls 31.2 percent of market deposits. In addition, the
Lincoln banking market appears to be attractive for out-ofmarket entry. It is the second most populous market in
Nebraska, and population growth in the Lincoln banking
market exceeded the national average growth rate from
1980 to 1992.12 As of June 1995, the market's unemployment rate of 2.8 percent was less than half the national
average unemployment rate. Moreover, per capita income
figures for 1993 show that the Lincoln banking market's
per capita income exceeds the national average.
In accordance with the BHC Act, the Board sought
comments from the United States Attorney General, the
Office of the Comptroller of the Currency ("OCC"), and
the Federal Deposit Insurance Corporation ("FDIC") on
the competitive effects of this proposal. The Attorney
General has advised the Board that the proposed transaction is not likely to have a significantly adverse effect on
competition on any relevant banking market. The OCC and
FDIC have not objected to consummation of the proposal
or indicated it would have any significantly adverse competitive effects in any relevant banking market.
Based on all the facts of record, including the small
amount by which the Department of Justice merger guidelines are exceeded and the number of competitors that
would remain in the market, 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 Lincoln banking market. More-
11. Under the revised Department of Justice Merger Guidelines, 49
Federal Register 26,823 (June 29, 1984), a market in which the
post-merger HHI is above 1800 is considered highly concentrated.
The Justice Department has informed the Board that a bank merger or
acquisition generally will not be challenged (in the absence of other
factors indicating anticompetitive effects) unless the post-merger HHI
is at least 1800 and the merger increases the HHI by more than
200 points. The Justice Department has stated that the higher than
normal HHI thresholds for screening bank mergers for anticompetitive effects implicitly recognize the competitive effect of limitedpurpose lenders and other non-depository financial entities.
12. This rate of growth also exceeded the growth rate for Omaha,
the only other metropolitan area in Nebraska, and the state as a whole
from 1990 to 1994.
171
over, based on all the facts of record, the Board concludes
that consummation of this proposal would not have a
significantly adverse effect on competition or the concentration of resources in any relevant market.
Other
Considerations
The financial and managerial resources and future prospects of FBS, FirsTier, and their respective subsidiaries are
consistent with approval, as are the other supervisory factors the Board must consider under section 3 of the BHC
Act. 13 The convenience and needs of the communities to
be served are also consistent with approval.
Nonbanking
Activities
FBS also has provided notice, pursuant to section 4(c)(8)
of the BHC Act to acquire the nonbanking subsidiaries of
FirsTier. The Board previously has determined by regulation or order that these activities are closely related to
banking for purposes of section 4(c)(8) of the BHC Act.
FBS has committed that it will conduct these activities in
accordance with the Board's regulations and orders approving these activities for bank holding companies. In every
case 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. 14 Based on all the facts of record, the Board has
concluded that financial and managerial considerations are
consistent with approval.
In order to approve this notice, the Board also must
determine that the performance of the proposed nonbanking 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).
13. The Board has carefully reviewed comments from an individual
("Commenter") alleging a number of improper actions by FirsTier
and its management, including allegations related to certain loan
transactions involving Commenter and her family farming business.
Commenter's allegations for the most part involve national banks
acquired by FirsTier in 1984: FirsTier Bank, N.A., and its predecessor,
Omaha National Bank (both in Omaha, Nebraska). Commenter has
filed several lawsuits based on her allegations in courts that had the
authority to provide appropriate remedies if allegations of improper
actions could have been substantiated, but Commenter's cases were
dismissed. The Board has considered these allegations in light of all
the facts of record, including reports of examination assessing the
managerial strength of FBS and FirsTier and their subsidiary banks.
The Board notes that after consummation, FirsTier would be integrated into the management structure of FBS and subject to the
policies and procedures of FBS. In light of all the facts of record, the
Board concludes that these comments do not warrant denial of this
proposal. These comments have been referred to the OCC, the bank's
primary supervisor, for consideration.
14. See 12 C.F.R. 225.24. See also The Fuji Bank Limited, 75
Federal Reserve Bulletin 94 (1989); Bayerische Vereinsbank AG, 73
Federal Reserve Bulletin 155 (1987).
172
Federal Reserve Bulletin • February 1996
Based on all the facts of record, the Board believes that this
proposal should enable FBS to provide greater convenience and improved service to FBS customers and to
customers of FirsTier's nonbanking subsidiaries. In considering the acquisition by FBS of FirsTier's nonbanking
activities, the record in this case indicates that there are
numerous providers of these nonbanking services, and
there is no evidence in the record to indicate that consummation of this proposal is likely to result in any significantly adverse effects, such as undue concentration of
resources, decreased or unfair competition, conflicts of
interests, or unsound banking practices that would outweigh the public benefits of this proposal. Accordingly, the
Board has determined that the balance of public interest
factors it must consider under section 4(c)(8) of the BHC
Act is favorable arid consistent with approval of the notice
to acquire FirsTier's nonbanking subsidiaries.
Conclusion
Based on the foregoing, including the commitments made
to the Board by FBS in connection with this application
and notice, and in light of all the facts of records, Board
has determined that the application and notice should be,
and hereby are, approved. The Board's approval is specifically conditioned on compliance by FBS with all the
commitments made in connection with this proposal. The
Board's determinations on the proposed nonbanking activities also are subject to all the conditions set forth in
Regulation Y, including those in sections 225.4(d) and
225.23(b) of Regulation Y, and to the Board's authority to
require such modification or termination of the activities of
a bank holding company or any of its subsidiaries as the
Board finds necessary to ensure compliance with, and to
prevent evasion of, the provisions of the BHC Act and the
Board's regulations and orders issued thereunder. For purposes of this action, the commitments and conditions relied
on by the Board in reaching this decision are deemed to be
conditions imposed in writing by the Board in connection
with its findings and decision, and, as such, may be enforced in proceedings under applicable law.
The acquisition of FirsTier's subsidiary banks shall not
be consummated before the fifteenth calendar day following the effective date of this order, and this proposal 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 Minneapolis, acting pursuant to delegated authority.
By order of the Board of Governors, effective December 18. 1995.
Voting for this action: Chairman Greenspan, Vice Chairman
Blinder, and Governors Kelley. Lindsey, Phillips, and Yellen.
WILLIAM W. WILES
Secretary of the Board
NationsBank Corporation
Charlotte, North Carolina
Order Approving the Acquisition
Company
of a Bank Holding
NationsBank Corporation, Charlotte, North Carolina ("NationsBank"), a bank holding company within the meaning
of the Bank Holding Company Act ("BHC Act"), has
applied under section 3 of the BHC Act (12 U.S.C. § 1842)
to acquire by merger Bank South Corporation ("BSC"),
and thereby indirectly acquire its subsidiary bank, Bank
South ("Bank South"), both of Atlanta, Georgia. 1 NationsBank also has provided notice under section 4(c)(8) of
the BHC Act (12 U.S.C. § 1843(c)(8)) and section 225.23
of the Board's Regulation Y (12 C.F.R. 225.23) to acquire
Bank South Life Insurance Company, Atlanta, Georgia
("Bank South Life"), and thereby engage in credit insurance activities, pursuant to section 225.25(b)(8)(i) of Regulation Y (12 C.F.R. 225.25(b)(8)(i)). 2 NationsBank would
engage in these activities nationwide. 3
Notice of this proposal, affording interested persons an
opportunity to submit comments, has been published (60
Federal Register 50,625 (1995)). The time for filing comments has expired, and the Board has considered the application and notices and all comments received in light of the
factors set forth in sections 3 and 4 of the BHC Act.
NationsBank, with total consolidated assets of approximately $188 billion, operates subsidiary banks in nine
states and the District of Columbia. 4 NationsBank is the
fourth largest commercial banking organization in the
United States, controlling approximately 4.8 percent of
total banking assets, and approximately 3.7 percent of total
insured deposits. NationsBank also engages in a number of
permissible nonbanking activities nationwide. NationsBank
is the largest commercial banking organization in Georgia,
1. In connection with this proposal, BSC has granted NationsBank
an option to purchase up to 19.9 percent of the voting shares of BSC
on the occurrence of certain events. This option would terminate on
the consummation of this proposal. Immediately after the merger of
NationsBank and BSC, NationsBank would transfer Bank South to
NB Holdings Corporation, Charlotte, North Carolina ("NB Holdings"), a wholly owned subsidiary of NationsBank. Thereafter, Bank
South would merge into NationsBank of Georgia, N.A., Atlanta,
Georgia ("NationsBank Georgia"), a wholly owned subsidiary of NB
Holdings.
2. NationsBank also has provided notice to acquire Bank South
Securities Corporation, Atlanta, Georgia. This company, however,
would cease its activities before acquisition by NationsBank and
would not engage in any activities without the Board's approval.
3. NationsBank also would acquire BSC's interest in approximately
4.16 percent of the voting shares of Southeast Switch, Inc., Maitland,
Florida ("Switch"), and thereby engage in providing data processing
services and management consulting advice pursuant to sections
225.25(b)(7) and (b)(l 1) of Regulation Y (12 C.F.R. 225.25(b)(7) and
(b)( 11)). Under Switch's articles of incorporation. NationsBank would
be required to sell this interest, because its share ownership interest in
Switch would exceed 15 percent.
4. Asset and state deposit data are as of June 30, 1995, and include
acquisitions by NationsBank approved after that date. NationsBank
also operates a limited-purpose credit card bank in Delaware.
Legal Developments
controlling deposits of approximately $8.7 billion, representing 12.9 percent of total deposits in commercial banking organizations in the state. BSC is the fifth largest
commercial banking organization in Georgia, controlling
deposits of approximately $5.1 billion, representing
7.5 percent of total deposits in commercial banking organizations in the state. Upon consummation of this proposal,
NationsBank would remain the largest depository institution in Georgia, controlling deposits of approximately
$13.8 billion, representing 20.4 percent of total deposits in
commercial banking organizations in the state.
Interstate
Analysis
Section 3(d) of the BHC Act, as amended by Section 101
of the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994, allows the Board to approve an application by a bank holding company to acquire control of a
bank located in a state other than the home state of such
bank holding company, if certain conditions are met. 5
These conditions are met in this case. 6 In view of all the
facts of record, the Board is permitted to approve this
proposal under section 3(d) of the BHC Act.
Competitive
Considerations
NationsBank and BSC compete directly in five banking
markets in Georgia. The Board has carefully considered
the effects that consummation of this proposal would have
on competition in all the banking markets served by BSC
in light of all the facts of record, including the characteristics of the markets, the increase in the concentration of
total deposits in depository institutions 7 in the markets as
measured by the Herfindahl-Hirschman Index ("HHI"), 8
and commitments made by NationsBank.
5. Pub. L. No. 103-328, 108 Stat. 2338 (1994). 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. For purposes of the BHC Act,
NationsBank's home state is North Carolina.
6. 12 U.S.C. §§ 1842(d)(1)(A) and (B) and 1842(d)(2)(A) and (B).
NationsBank is adequately capitalized and adequately managed. Bank
South has been in existence and continuously operated for the minimum period of time required under Georgia law. In addition, on
consummation of this proposal, NationsBank and its affiliates would
control less than 10 percent of the total amount of deposits of insured
depository institutions in the United States and less than 30 percent of
the total amount of deposits of insured depository institutions in
Georgia.
7. Market data are as of June 30, 1994. In this context, depository
institutions include commercial banks, savings banks, and savings
associations. 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 WM Bancorp, 76 Federal Reserve Bulletin 788 (1990); National
City Corporation, 70 Federal Reserve Bulletin 743 (1984).
8. 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. In such markets, the Justice Department is likely to challenge a
173
The acquisition of BSC by NationsBank would significantly increase market concentration in the Fitzgerald and
Savannah banking markets, 9 as measured by the HHI. 10 In
order to mitigate the potential adverse competitive effects
that might result from this acquisition, BSC has entered
into definitive agreements to sell its only branch in the
Fitzgerald banking market to a competitor not currently
operating in the market and to sell one branch in the
Savannah banking market to a competitor operating in the
market that can purchase the branch without exceeding the
concentration levels in the Department of Justice merger
guidelines." As a result of these divestitures, the HHI in
the Fitzgerald banking market would remain unchanged
and the HHI in the Savannah banking market would increase 185 points to 1799 points. Consummation of this
proposal in the three remaining banking markets where
NationsBank and BSC compete also would not exceed
market concentration levels in the Department of Justice
merger guidelines. 12 Moreover, numerous competitors
would remain in all the relevant banking markets.
The Department of Justice has indicated that, in light of
the proposed divestitures, this proposal is not likely to have
a significantly adverse effect on competition. Based on all
the facts of record, including the proposed divestitures, the
Board concludes that consummation of this proposal is not
likely to have a significantly adverse effect on competition
or on the concentration of resources in any relevant banking market.' 3
merger that increases the HHI by more than 50 points. The Justice
Department has informed the Board that a bank merger or acquisition
generally will not be challenged (in the absence of other factors
indicating anti-competitive effects) unless the post-merger HHI is at
least 1800 and the merger or acquisition increases the HHI by at least
200 points. The Justice Department has stated that the higher than
normal threshold for an increase in the HHI when screening bank
mergers and acquisitions for anti-competitive effects implicitly recognizes the competitive effects of limited-purpose lenders and other
non-depository financial entities.
9. The Fitzgerald banking market consists of Ben Hill and Irwin
Counties. The Savannah banking market consists of Bryan, Chatham,
Effingham, and Liberty Counties.
10. As a result of this proposal, the HHI in the Fitzgerald banking
market would increase by 716 points to 2827 points, and the HHI in
the Savannah banking market would increase by 213 points to 1827
points.
11. In addition, NationsBank has committed that if these divestitures are not completed within six months after consummation of this
proposal, it will transfer the unsold branches to an independent trustee
who will be instructed to sell the branches promptly. See Bank
America Corporation, 78 Federal Reserve Bulletin 338 (1992); United
New Mexico Financial Corporation, 11 Federal Reserve Bulletin 484
(1991). NationsBank also has committed to submit to the Board, prior
to consummation of this proposal, an executed trust agreement acceptable to the Board.
12. The HHI would increase as follows: Athens banking market—
157 points to 1274 points; Atlanta banking market—370 points to
1475 points; and Macon banking market—405 points to 1492 points.
13. The HHI would increase as follows: Athens banking market—
157 points to 1274 points; Atlanta banking market—370 points to
1475 points; and Macon banking market—405 points to 1492 points.
174
Federal Reserve Bulletin • February 1996
Convenience and Needs
Considerations
In acting on an application to acquire a depository institution under the BHC Act, the Board must consider the
convenience and needs of the communities to be served,
and take into account the records of the relevant depository
institutions under the Community Reinvestment Act
(12 U.S.C. § 2901 et seq.) ("CRA"). The CRA requires
the federal financial supervisory agencies to encourage
financial institutions to help meet the credit needs of the
local communities in which they operate, consistent with
their safe and sound operation. To accomplish this end, the
CRA requires the appropriate federal supervisory authority
to "assess the institution's record of meeting the credit
needs of its entire community, including low- and
moderate-income neighborhoods, consistent with the safe
and sound operation of such institution," and to take that
record into account in its evaluation of bank expansion
proposals. 14
The Board received comments on this proposal from
several commenters ("Protestants") 15 alleging, on the basis of data filed under the Home Mortgage Disclosure Act
("HMDA"), that NationsBank of Georgia, N.A., Atlanta,
Georgia ("NationsBank Georgia"), and NationsBanc
Mortgage Corporation, Dallas, Texas ("NationsBanc Mortgage"), illegally discriminate against African Americans in
mortgage lending in Georgia. 16 In addition, Protestants
express concern that deposits that NationsBank collects in
Georgia might be used to fund loans and investments out
of state rather than be reinvested in local communities.
Protestants also criticized Bank South for its record of
lending to census tracts with predominantly low- and
moderate-income and minority residents as indicated by
HMDA data.
The Board has carefully reviewed the CRA performance
records of NationsBank, BSC, and their respective subsidiary banks, all comments received on this application,
NationsBank's and BSC's responses to these comments,
and all other relevant facts of record in light of the CRA,
the Board's regulations, and the Statement of the Federal
Financial Supervisory Agencies Regarding the Community
Reinvestment Act ("Agency CRA Statement"). 17
14. 12 U.S.C. § 2903.
15. Protestants include the International Brotherhood of Teamsters,
the Atlanta, Georgia Labor Council, and several individuals.
16. Protestants maintain that these allegations are supported by a
recent lawsuit alleging that NationsBank illegally discriminates
against African Americans in making mortgage loans in the Washington, D.C., metropolitan area. NationsBank has denied any wrongdoing, and the litigation is in the early stages of developing a factual
record. The Office of the Comptroller of the Currency and the Board,
moreover, have sufficient supervisory authority to take appropriate
action against NationsBank, if the plaintiffs's claims of illegal activity
can be substantiated, and the Board can take such findings into
account in considering future applications by NationsBank to expand
its activities.
17. 54 Federal Register 13,742 (1989).
Record
of Performance
under the
CRA
The Board recently reviewed the CRA performance record
of NationsBank in connection with its application to acquire CSF Holdings, Inc., Miami, Florida, and concluded
that NationsBank and its subsidiary banks have the types
of policies and programs in place and working well that
support an effective record of CRA performance. 18
This review considered the "satisfactory" or "outstanding" ratings for CRA performance received by all of
NationsBank's subsidiary banks from the Office of the
Comptroller of the Currency ("OCC"), their primary federal supervisor; NationsBank's lending activities, including its progress under its Community Investment Program ("CIP") (a 10-year commitment to make a minimum of $10 billion of community investment loans);
NationsBank's ascertainment and marketing activities; and
NationsBank's policies and record of closing branches.
The Board also carefully considered NationsBank's
compliance with applicable fair lending laws. The CSF
Order notes that OCC examinations found that all of
NationsBank's subsidiary banks were in compliance with
the substantive provisions of the Fair Housing Act and the
Equal Credit Opportunity Act ("fair lending laws"). 1 9 Examiners found no evidence of prohibited discriminatory
practices or of practices intended to discourage applications for the types of products set forth in the banks' CRA
statements. According to the examinations, each bank had
adequate policies, procedures, and training programs in
place to support nondiscrimination in lending activities,
and conducted internal audits to evaluate compliance with
fair lending laws. Moreover, the OCC examinations found
that the banks's community delineations were reasonable
and did not arbitrarily exclude low- and moderate-income
areas, and that the banks annually reviewed their delineations and the geographic distribution of their lending. NationsBank's Community Investment Group, which includes
its Fair Lending Program, also was found to have developed internal and external second and third review programs for declined mortgage applications. 20
For the reasons discussed in detail in the CSF Order,
which are incorporated herein by reference, the Board
concluded that the CRA performance record of NationsBank was consistent with approval of an acquisition
under the BHC Act. After consummation of this proposal,
NationsBank would implement its CRA and fair lending
policies and procedures at Bank South.
18. NationsBank Corporation, 81 Federal Reserve Bulletin 1121
(1995) ("CSF Order").
19. An examination of NationsBanc Mortgage as part of this review
also found no violations of fair lending laws.
20. One commenter expressed concern, without providing specific
facts, that NationsBank's consumer finance subsidiary, NationsCredit
Corporation, Allentown, Pennsylvania ("NationsCredit"), lends to
minorities and in minority communities at higher rates and fees than
those of other NationsBank subsidiaries that primarily serve nonminorities and non-minority communities. There is no evidence in the
record that NationsCredit charges higher rates or fees on any prohibited basis.
Legal Developments
Record
of CRA Performance
in
Georgia
CRA Performance Examinations. The Agency CRA Statement provides that a CRA examination is an important and
often controlling factor in the consideration of an institution's CRA record and that reports of these examinations
will be given great weight in the applications process. 21
After the CSF Order, the OCC released the results of its
most recent examinations of NationsBank's subsidiary
banks for CRA performance. NationsBank Georgia received an "outstanding" rating for CRA performance, as
of July 1995. In addition, Bank South received a "satisfactory" rating for CRA performance from the OCC as of
January 1995.22
HMDA Data. The Board has carefully considered Protestants' allegations about lending to African Americans in
Atlanta in light of 1993 and 1994 HMDA data for NationsBank Georgia and NationsBanc Mortgage. A comparison of the 1993 and 1994 HMDA data for these institutions combined indicates an increase in 1994 in the
percentage of applications received by NationsBank from
African Americans, and that in both years NationsBank
received a higher percentage of its total applications from
African Americans than did financial institutions in the
market in the aggregate. 23 Between 1993 and 1994, the
percentage of loan originations by NationsBank to African
Americans increased, the percentage of loan denials decreased, and the disparity between NationsBank's denial
rates for African-American applicants and non-minority
applicants declined. These data also show, however, that
there were disparities in the rates of loan denials by racial
groups.
The Board is concerned when the record of an institution
indicates disparities in lending to minority applicants, and
it believes that all banks are obligated to ensure that their
lending practices are based on criteria that assure not only
safe and sound lending, but also assure equal access to
credit by creditworthy applicants regardless of race. The
Board recognizes, however, that HMDA data alone provide
an incomplete measure of an institution's lending in its
community. The Board also recognizes that HMDA data
have limitations that make the data an inadequate basis,
absent other information, for concluding that an institution
has engaged in illegal discrimination in lending.
As previously noted, NationsBank Georgia is in compliance with the substantive provisions of fair lending laws,
and the most recent OCC examinations of the bank and the
21. 54 Federal Register 13,745.
22. OCC examiners also conducted a fair lending review of Bank
South and its mortgage company subsidiary, which included comparisons of loan files in which African-American applicants were denied
loans and non-minority applicants were granted loans. This review
found no evidence of fair lending law violations.
23. Applications from African Americans increased from 15.5 percent of total applications in 1993 to 20.9 percent in 1994. Lenders in
the Atlanta market in the aggregate received 10.6 percent of total
applications from African Americans in 1993 and 16.8 percent in
1994. African Americans constituted 25.1 percent of the total population in the Atlanta market in 1994.
175
previous examinations noted in the CSF Order found no
evidence of prohibited discriminatory practices or of practices intended to discourage applications for the types of
products set forth in the bank's CRA statement. NationsBank Georgia has in place all of NationsBank's fair
lending review policies and procedures, including its second and third review programs for applications for which a
preliminary decision to decline has been made. 24 These
examinations also found that the bank's geographic distribution of applications, originations, and denials was reasonable, and considered the bank to be effective in serving
low- and moderate-income individuals and areas.
Record of Lending Activities. During 1993, NationsBank
made 873 home mortgage loans for a total of $60.2 million
to African Americans in the Atlanta market, and made 778
such loans for a total of $42.9 million in 1994. NationsBank also offers loans to qualifying low- and
moderate-income borrowers under its CIP initiative, as
reviewed in the CSF Order, using nontraditional underwriting criteria and offering below-market rates and reduced
down payment requirements and closing costs. During
1994, NationsBank made 66 loans totalling $5.2 million in
Georgia under this program.
In addition, in 1993 the bank made 22 commercial real
estate loans totalling $7.5 million for community development purposes, such as the development of low- and
moderate-income single- and multi-family housing units
and renovations of community and retail centers in underserved areas. The bank committed an additional $22 million for this purpose in 1994. NationsBank Georgia also
supported the community development initiatives of organizations established to help provide housing for low- and
moderate-income families. During 1993, for example, the
bank committed $500,000 to the Atlanta Equity Fund to
provide bridge financing for multi-family housing projects.
During 1994, the bank committed $3.3 million to the
Atlanta Multi-Family Finance Alliance to provide construction and bridge financing for housing for low- and
moderate-income households. 25
NationsBank Georgia also has been a leading small
business lender throughout Georgia. During 1993, the bank
24. An individual Protestant criticized NationsBank Georgia for
denying his loan application and maintained that the bank illegally
discriminates against African Americans in the Atlanta area. In light
of all the facts of record discussed above, the Board does not believe
that these comments warrant denial of the application. The Board has
provided these comments to the OCC for consideration.
25. NationsBank also supports the community development initiatives of other organizations at the corporate level. During 1993,
NationsBank Community Development Corporation ("NationsBank
CDC") formed a partnership with the Atlanta Neighborhood Development Partnership and invested approximately $14 million to acquire
and renovate 2,811 multi-family housing units. During 1994,
NationsBank CDC entered into two additional partnerships to construct up to 30 new single-family homes for low- and moderateincome households in the Martin Luther King, Jr., Historic District
and the Summerhill neighborhood. Nations Housing Fund, a partnership formed in 1993 by NationsBank and Enterprise Social Investment Corporation, committed $1.1 million in 1994 to revitalize 84
low-income apartment units in the East Point neighborhood.
176
Federal Reserve Bulletin • February 1996
made 23 Small Business Administration ("SBA") loans for
a total of $8.2 million, and originated 5,739 small business
loans for a total of $397.4 million. 26 During 1994, the bank
made 50 SBA loans totalling $16.6 million, and originated
3,568 small business loans totalling $245 million.
NationsBank Georgia committed $2.5 million to a microloan pool administered by the Atlanta Business Community Development Corporation, and made a four-year commitment totalling $200,000 to the Savannah Community
Development Corporation to be used to provide bridge
financing to small businesses. The bank invested approximately $2.7 million in the Greater Atlanta Small Business
Project, the Entrepreneurial Development Loan Fund, and
Renaissance Capital Corporation to be used for loans to
small businesses that normally would not qualify for conventional bank financing.27
Conclusion Regarding Convenience and Needs
Factors
The Board has carefully considered all the facts of record
in reviewing NationsBank's record of CRA performance.
Based on a review of the entire record of performance,
including information provided by all commenters,
NationsBank, and BSC, the Board has concluded that
convenience and needs considerations, including the overall CRA performance records of the institutions involved
in this proposal, are consistent with approval of this application.
tion 4(c)(8) of the BHC Act. 28 NationsBank has committed
that it will conduct these activities in accordance with
Regulation Y.
In order to approve this proposal, the Board also must
determine that the proposed activities represent a proper
incident to banking, that is, that the proposed transaction
"can reasonably be expected to produce benefits to the
public, 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, or unsound banking practices." 29 On
the basis of the record, the Board believes that this proposal should enable NationsBank to provide greater convenience and improved services to its customers. Financial
and managerial considerations also are consistent with
approval. 30 On the basis of these considerations and all
other facts of record, the Board has determined that there is
no evidence in the record to indicate that consummation of
this proposal is likely to result in any significantly adverse
effects, such as undue concentration of resources, decreased or unfair competition, conflicts of interests, or
unsound banking practices, that would outweigh the public
benefits of this proposal. Accordingly, the Board has determined that the balance of public interest factors it must
consider under section 4(c)(8) of the BHC Act is favorable
and consistent with approval of NationsBank's proposal to
acquire Bank South Life.
Conclusion
Other
Considerations
The Board also has reviewed the financial and managerial
resources and future prospects of NationsBank, Bank
South, and their respective subsidiaries, and the other supervisory factors the Board must consider under section 3
of the BHC Act. Based on all the facts of record, the Board
has concluded that these factors are consistent with approval of the application.
Nonbanking
Activities
NationsBank also has given notice, pursuant to section
4(c)(8) of the BHC Act, to acquire Bank South Life, and
thereby engage in credit insurance activities. Section 4(c)(8) of the BHC Act provides that a bank holding
company may, with Board approval, engage in any activity
that the Board determines to be "so closely related to
banking or managing or controlling banks, as to be a
proper incident thereto." The Board previously has determined by regulation that the activities of Bank South Life
are closely related to banking within the meaning of sec-
26. Small business loans include non-real estate commercial loans
originated in amounts up to $500,000.
27. The bank also provides technical support to small businesses,
such as Small Business Journey, a seven-week course on the fundamentals of small business management offered with the University of
Georgia Small Business Development Center. Over 340 persons graduated from this program in 1994.
Based on the foregoing and all other facts of record,
including all the commitments made by NationsBank discussed in this order, the Board has determined that this
application and the notices should be, and hereby are,
approved. The Board's approval is specifically conditioned
on compliance by NationsBank with all commitments
made in connection with this application and these notices,
including its divestiture commitments as discussed above.
The Board's determination on the proposed nonbanking
activities also is subject to all the conditions set forth in
Regulation Y, including those in sections 225.7 and
225.23(g) (12 C.F.R. 225.7 and 225.23(g)), and to the
Board's authority to require such modification or termination of the activities of a holding company or any of its
subsidiaries as the Board finds necessary to assure compliance with, or to prevent evasions of, the provisions and
purposes of the BHC Act and the Board's regulations and
orders issued thereunder. The commitments and conditions
relied on by the Board in reaching this decision are deemed
to be conditions imposed in writing by the Board in connection with its findings and decision, and, as such, may be
enforced in proceedings under applicable law.
The acquisition of Bank South shall not be consummated before the fifteenth calendar day following the effec-
28. 12 C.F.R. 225.25(b)(8)(i).
29. 12 U.S.C. § 1843(c)(8).
30. See 12 C.F.R. 225.24(b).
Legal Developments
tive date of this order, and this proposal 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
Richmond, acting pursuant to delegated authority.
By order of the Board of Governors, effective December 18, 1995.
Voting for this action: Chairman Greenspan, Vice Chairman
Blinder, and Governors Kelley, Lindsey, Phillips, and Yellen.
WILLIAM W. WILES
Secretary of the Board
U.S. Bancorp
Portland, Oregon
Order Approving the Acquisition of a Bank Holding
Company
U.S. Bancorp, Portland, Oregon ("U.S. Bancorp"), a bank
holding company within the meaning of the Bank Holding
Company Act ("BHC Act") has applied under section 3 of
the BHC Act (12 U.S.C. § 1842) to acquire all the voting
shares of West One Bancorp, Boise, Idaho ("West One"),
and thereby indirectly acquire its subsidiary banks. 1
U.S. Bancorp also has provided notice under section 4(c)(8)
of the BHC Act (12 U.S.C. § 1843(c)(8)) and section
225.23 of the Board's Regulation Y (12 C.F.R. 225.23) to
acquire the nonbanking subsidiaries of West One, and
thereby engage in permissible nonbanking activities. 2
Notice of the proposal, affording interested persons an
opportunity to submit comments, has been published (60
Federal Register 49,847 (1995)). The time for filing comments has expired and the Board has considered the applications and notices and all comments received in light of
the factors set forth in sections 3 and 4 of the BHC Act. 3
1. The subsidiary banks are West One Bank and Idaho First Bank,
both in Boise, Idaho; West One Bank, Oregon, Portland, and West
One Bank, Oregon, S.B., Hillsboro, both in Oregon; West One Bank
Washington, Seattle, Washington; and West One Bank, Utah, Salt
Lake City, Utah.
2. The nonbanking subsidiaries are West One Trust Co., Salt Lake
City, Utah, and West One Trust Co., Washington, Seattle, Washington, which engages in trust company activities pursuant to section
225.25(b)(3) of Regulation Y (12 C.F.R. 225.25(b)(3)); West One Life
Insurance Co., Phoenix, Arizona, which engages in insurance activities permitted under section 4(c)(8) of the BHC Act, pursuant to
sections 225.25(b)(8)(i) of Regulation Y (12 C.F.R. 225.25(b)(8)(i));
and West One Financial Services, Inc., Boise, Idaho, which engages in
residential and commercial mortgage servicing activities pursuant to
section 225.25(b)(l)(iii) of Regulation Y 12 C.F.R. 225.25(b)(l)(iii)).
3. Two Commenters contended that notice of the proposal was
inadequate. The Board's Rules of Procedure (12 C.F.R.
262.3(b)(l)(ii)(E)) require an applicant to publish notice in a newspaper of general circulation in the community where the head offices of
the largest subsidiary bank of the applicant, if any, or the applicant and
each organization to be acquired are located. Notice of the proposal,
inviting public comment was published on September 14, 1995, in a
newspaper of general circulation in Portland, where U.S. Bancorp is
located, and in newspapers of general circulation in the following
66
U.S. Bancorp, with total consolidated assets of
$21.4 billion, operates subsidiary banks in California,
Idaho, Nevada, Oregon, and Washington State. 4 U.S. Bancorp is the 37th largest banking organization in the United
States, controlling less than 1 percent of total banking
assets in the United States. U.S. Bancorp also engages in a
number of permissible nonbanking activities nationwide.
West One, with consolidated assets of $9.2 billion, operates subsidiary banks in Idaho, Oregon, Washington, and
Utah. West One is the 70th largest banking organization in
the United States, controlling less than 1 percent of total
banking assets in the United States. Upon consummation
of this proposal, U.S. Bancorp would become the nation's
32d largest banking organization, controlling less than 1
percent of total banking assets in the United States.
Interstate
Analysis
Section 3(d) of the BHC Act, as amended by Section 101
of the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994, allows the Board to approve an application by a bank holding company to acquire control of a
bank located in a state other than the home state of such
bank holding company, if certain conditions are met. 5
These conditions are met in this case. 6 In view of all the
facts of record, the Board is permitted to approve this
proposal under section 3(d) of the BHC Act.
cities where West One's banks are located: Boise (September 15,
1995); Seattle (September 13, 1995); and Salt Lake City (September
15, 1995). In addition, consistent with the Board's Rules of Procedure
(12 C.F.R. 262.3(i)(l)), the Board published notice of this proposal in
the Federal Register, inviting public comment for 23 days. The Board
has received and carefully reviewed comments from organizations in
different states where West One's banks are located. Based on all the
facts of record, the Board concludes that notice was published in
accordance with its Rules and that the public was adequately notified
of this proposal.
4. All asset data are as of June 30, 1995.
5. Pub. L. No. 103-328, 108 Stat. 2338 (1994). 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. For purposes of the BHC Act,
the home state of U.S. Bancorp is Oregon.
6. 12 U.S.C. §§ 1842(d)(1)(A) and (B) and 1842(d)(2)(A) and (B).
U.S. Bancorp is adequately capitalized and adequately managed. West
One's banks have been in existence and continuously operated for the
periods of time required under the laws of the states of Idaho, Utah
and Washington. In addition, upon consummation of this proposal,
U.S. Bancorp and its affiliates would control less than 10 percent of
the total amount of deposits of insured depository institutions in the
United States, and less than 30 percent of the total amount of deposits
of insured depository institutions, or the applicable state deposit limit,
in Utah and Washington. U.S. Bancorp would control more than
30 percent of the total deposits in depository institutions in Idaho after
the proposal. However, Idaho law expressly eliminates any deposit
limitations (Idaho Code § 26-1606 as amended (1995)) and the
Director of the Department of Finance has indicated that the transaction is permissible under relevant Idaho law. Accordingly, in this case
the acquisition by U.S. Bancorp of deposits in Idaho is permitted
under section 3(d)(2)(D) of the BHC Act (12 U.S.C. § 1842(d)(2)(D)).
178
Federal Reserve Bulletin • February 1996
Competitive
Considerations
U.S. Bancorp and West One compete directly in 23 banking markets in Idaho, Oregon, and Washington. 7 The Board
has carefully considered the effects that consummation of
this proposal would have on competition in these banking
markets, in light of all the facts of record, including the
characteristics of these markets, the projected increase in
the concentration of total deposits in depository institutions 8 in these markets ("market deposits") as measured
by the Herfindahl-Hirschman Index ("HHI"), 9 and commitments made by U.S. Bancorp to divest certain branches.
In evaluating the competitive factors in this case, the Board
also has carefully considered the views presented by commenters.
In fourteen banking markets, consummation of this proposal would not exceed the levels of market concentration
as measured by the HHI under the Department of Justice
( " D O J " ) merger guidelines. 10 In nine other banking markets, 1 ' the increase in the concentration of market deposits,
as measured by the HHI, indicates that the combination of
U.S. Bancorp and West One, without divestitures, could
result in significantly adverse competitive effects. In order
7. State banking data and local banking markets are set forth in the
Appendix.
8. Market deposit data are as of June 30, 1994. Market share data
are based on calculations in which the deposits of thrift institutions are
included at 50-percent weighted basis. 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). Thus, the
Board has regularly included thrift deposits in the calculation of
market share on a 50-percent weighted basis. See, e.g., First Hawaiian
Inc., 11 Federal Reserve Bulletin 52 (1991).
9. 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. In such markets, the Department of Justice (the "DOJ") is
likely to challenge a merger that increases the HHI by more than
50 points. The DOJ has informed the Board that a bank acquisition or
merger generally will not be challenged (in the absence of other
factors indicating anti-competitive effects) unless the post-merger
HHI is at least 1800 and the merger or acquisition increases the HHI
by at least 200 points. The DOJ has stated that the higher than normal
threshold for anti-competitive effects implicitly recognizes the competitive effect of limited-purpose lenders and other non-depository
financial entities.
10. The markets and the HHI increases are as follows. In Idaho,
Boise (98 points to 3150); Lewiston (86 points to 2025); Moscow
(354 points to 1494); and Nampa (56 points to 2281). In Oregon,
Corvallis (165 points to 1692); Deschutes County (90 points to 1934);
Eugene (121 points to 1680); and Salem (158 points to 1636). In
Washington, Bremerton (54 points to 1512); Olympia (63 points to
1309); Seattle (85 points to 1800); Skagit County (124 points to
1875); and Spokane (277 points to 1783). U.S. Bancorp also has
committed to divest a branch in the Yakima, Washington, banking
market, although consummation of this proposal would not exceed
DOJ merger guidelines in that market. In light of this divestiture, the
HHI for the market would increase 253 points to 1604 points.
11. The banking markets are as follows: in Oregon, Jefferson
County, Lincoln County, Ontario, Pendleton, Portland, and Wasco
County; in Washington, Bellingham, Kittitas County, and PascoKennewick-Richland.
to mitigate the potential that this proposal may result in
adverse competitive effects in these markets, U.S. Bancorp
has committed to divest branches in each of these banking
markets to one or more acquirors whose purchase of
branches would not substantially lessen competition. 12 After consummation of this proposal and the divestiture of
branches, the competitive effect of this proposal would be
within the market concentration levels set forth in the DOJ
Merger Guidelines and the parameters applied by the Board
in previous decisions in all markets, except the Portland
banking market. 13
Portland Banking Market. U.S. Bancorp is the largest
banking organization in the Portland banking market. 14 On
acquisition of West One, U.S. Bancorp would control approximately $5.4 billion in deposits, representing approximately 40.5 percent of market deposits. To mitigate the
potential anti-competitive effects of this acquisition in the
Portland banking market, U.S. Bancorp has entered into
divestiture agreements to sell 16 branches and approximately $341 million of deposits to a firm that is not
currently competing in the Portland market. On consummation of the proposed divestiture, the HHI in the Portland
banking market would increase by 230 points to 2226, and
U.S. Bancorp would control 37.9 percent of the market.
A number of additional factors indicate, however, that
the increase in concentration levels in the Portland banking
market, as measured by the HHI, tends to overstate the
competitive effects of this proposal taking into consideration the proposed divestitures. For example, 21 competitors would remain in the market, and the number of competitors would not be reduced because U.S. Bancorp has
committed to sell the divested branches to an out-of-
12. With respect to each market in which U.S. Bancorp has committed to divest offices it has committed to execute sale agreements prior
to consummation of the acquisition of West One, and to consummate
these divestitures within 180 days of consummation. U.S. Bancorp has
committed that if it is unsuccessful in completing these divestitures
within 180 days of consummation of this proposal, it will transfer the
unsold branches to an independent trustee with instructions to sell the
branches promptly. See BankAmerica Corporation, 78 Federal Reserve Bulletin 338 (1992); United New Mexico Financial Corporation, 11 Federal Reserve Bulletin 484 (1991). Furthermore,
U.S. Bancorp has committed to submit to the Board, prior to consummation of the acquisition, an executed trust agreement acceptable to
the Board stating the terms of the divestiture.
13. Based on U.S. Bancorp's proposed divestitures, the HHI in these
banking markets would increase as follows. In Oregon, Jefferson
County (no increase), Lincoln County (increase not to exceed
29 points to 2025 points), Ontario (increase not to exceed 189 points
to 1870 points), Pendleton (no increase), and Wasco County (no
increase); in Washington, Bellingham (increase not to exceed 252
points to 1774 points), Kittitas County (increase not to exceed 10
points to 1500 points), and Pasco-Kennewick-Richland (increase not
to exceed 107 points to 1954 points).
14. The Board received comments concerning the competitive effects of this transaction from an individual and an organization. The
individual expressed concern that the proposed transaction would
have a significantly adverse effect on competition or the concentration
of resources in the Portland, Oregon, banking market, as evidenced by
higher deposit interest rates and rates of return at West One. The
organization expressed concern about adverse effects on competition
in the State of Washington.
Legal Developments
market competitor. In addition, Portland is an attractive
market for entry. It is the largest banking market in Oregon, and, from 1990 to 1994, its population grew faster
than any other metropolitan area in Oregon. Five new
competitors have entered the market de novo since 1992,
and two more have received regulatory approval to enter
the market. In addition, the number of branches in the
market has increased by 60 over the last live years.
In accordance with the BHC Act, the Board has sought
comments from the United States Attorney General, the
Office of the Comptroller of the Currency ("OCC"), and
the Federal Deposit Insurance Corporation ("FDIC") on
the competitive effects of this proposal. The Attorney
General has advised the Board that, in light of the proposed
divestitures, the proposed transaction is not likely to have a
significantly adverse effect on competition in any relevant
banking market. The OCC and FDIC have not objected to
consummation of the proposal or indicated that it would
have any significantly adverse competitive effects in any
relevant banking market.
Based on all the facts of record, including the views
expressed by commenters on the potential competitive
effects of this proposal, and for the reasons discussed in
this order, the Board concludes that consummation of this
proposal is not likely to have a significantly adverse effect
on competition or on the concentration of resources in any
relevant banking market. This determination is subject to
completion of the divestitures proposed by US. Bancorp in
connection with these applications.
Convenience and Needs
Considerations
In acting on an application to acquire a depository institution under the BHC Act, the Board must consider the
convenience and needs of the communities to be served,
and take into account the records of the relevant depository
institutions under the Community Reinvestment Act
(12 U.S.C § 2901 et seq.) ("CRA"). The CRA requires the
federal financial supervisory agencies to encourage financial institutions to help meet the credit needs of the local
communities in which they operate, consistent with their
safe and sound operation. To accomplish this end, the CRA
requires the appropriate federal supervisory authority to
"assess the institution's record of meeting the credit needs
of its entire community, including low- and moderateincome neighborhoods, consistent with the safe and sound
operation of such institution," and to take that record into
account in its evaluation of bank expansion proposals. 15
The Board has received comments supporting this proposal from a number of organizations, which commended
U.S. Bancorp's efforts in promoting affordable housing
initiatives and helping community groups achieve their
objectives for lending programs for minorities and lowand moderate-income individuals. US. Bancorp also was
commended for providing leadership by encouraging bank
personnel with financial expertise to assist in addressing
15. 12 U.S.C. § 2903.
179
housing-related credit needs of its entire community, including low- and moderate-income neighborhoods.
One commenter expressed concern, however, that the
proposal could have an adverse effect on U.S. Bancorp's
record of performance because of alleged deficiencies in
the CRA performance record of West One. In particular,
the commenter questioned West One's record of lending
to, and of providing lending products that take into account
specialized needs of, minorities and residents of lowincome census tracts. The commenter also suggested that
future branch closings by US. Bancorp, especially in rural
areas, should be monitored closely. 16
The Board has carefully reviewed the CRA performance
records of U S . Bancorp, West One, and their respective
subsidiary banks; all comments received; responses to
those comments by US. Bancorp and West One; and all
other relevant facts of record, in light of the CRA, the
Board's regulations, and the Statement of the Federal Financial Supervisory Agencies Regarding the Community
Reinvestment Act ("Agency CRA Statement").
Record
of Performance
Under the
CRA
A. CRA Performance Examinations
The Agency CRA Statement provides that a CRA examination is an important and often controlling factor in the
consideration of an institution's CRA record and that reports of these examinations will be given great weight in
the applications process. 17 The Board notes that two of
U.S. Bancorp's subsidiary banks, U.S. National Bank of
Oregon, Portland, Oregon ("USNB"), its lead subsidiary
bank, and US. Bank of Washington, N.A., Seattle, Washington ("USWA"), both received "outstanding" ratings
from their primary federal supervisor, the OCC, in their
most recent publicly available examinations for CRA performance, as of March 1994. 18 U.S. Bancorp's subsidiary
bank in Idaho, US. Bank of Idaho, N.A., Coeur d'Alene,
Idaho ("USBI"), received a "satisfactory" rating from the
16. 54 Federal Register 13,742 (1989). Two commenters have
reached agreements with U.S. Bancorp regarding services to be provided to low- and moderate-income communities and have requested
that the Board monitor and enforce compliance with these agreements.
The Board has indicated in previous orders and in the Agency CRA
Statement that communication by depository institutions with community groups provides a valuable method of assessing and determining
how best to address the credit needs of the community. Both the CRA
and the Agency CRA Statement require the Board's review to focus
on the established record of performance of the institutions involved
and the programs and policies that the institutions have in place to
assist in meeting the credit needs of their entire communities. See
Fifth Third Bancorp, 80 Federal Reserve Bulletin 838 (1994). The
Board believes, moreover, that agreements between banking organizations and community groups are private arrangements that are not
enforceable by the Board.
17. Id. at 13,745.
18. U.S. Bancorp's subsidiary savings bank in Washington,
U.S. Savings Bank of Washington, Bellingham, received a "satisfactory" rating from the FDIC in its most recent examination of CRA
performance, as of May 1993.
180
Federal Reserve Bulletin • February 1996
OCC in its most recent examination of CRA performance,
as of September 1994. West One's lead bank, West One
Bank, Idaho, Boise, Idaho, was rated "outstanding" for
CRA performance by the Federal Reserve Bank of San
Francisco, as of June 1995. West One's remaining subsidiary banks all received ratings of "outstanding" or "satisfactory" as of their most recent CRA performance evaluations by their primary federal supervisors. 19
B. Lending Policies and Programs
The Board notes that U.S. Bancorp has the types of policies
and programs in effect and working well that assist in
providing an effective record of CRA performance. Upon
consummation of this proposal, West One would be integrated into the U.S. Bancorp corporate CRA structure, and
U.S. Bancorp has stated that it plans to continue
U.S. Bancorp's overall policies and practices, consistent
with safe and sound operations, in its existing market areas
and in the new market areas U.S. Bancorp would enter as a
result of the proposal. U.S. Bancorp also intends to review
the particular programs currently offered by West One to
ensure that unique CRA-related needs identified by West
One continue to be met.
CRA lending programs include products designed to
assist in meeting the credit needs of low- and moderateincome areas and individuals, small businesses, and small
farms. For example, U.S. Bancorp subsidiary banks offer
home loan programs with required downpayments as low
as 2 percent, permit closing costs to be financed, provide
down payment assistance, and offer flexible underwriting
criteria in the areas of credit history, income ratios, and
sources of down payment. 20 The banks also participate in
special home loan programs developed by the secondary
market, as well as government-insured programs offered
by the Veterans Administration and the Federal Housing
Administration.
In terms of small business lending, U.S. Bancorp subsidiary banks offer a variety of credit products to small
businesses, including the 7a, 504 and Low-Doc programs
through the Small Business Administration. Small businesses owned by women and minorities and small businesses in disadvantaged areas are eligible for loans through
U.S. Bancorp's Commercial Opportunity Loan Program.
This program provides financing under underwriting standards more liberal than conventional financing in terms of
qualifying criteria and loan terms. Community development activities of the banks include construction and permanent financing for multi-family affordable housing de-
19. West One Bank, Oregon, Portland, Oregon; West One Bank,
Oregon, S.B., Hillsboro, Oregon; West One Bank, Washington, Seattle, Washington; and West One Bank, Utah, Salt Lake City, Utah, all
received CRA Examination ratings of "outstanding" from their primary federal supervisors in their most recent CRA Examinations.
Idaho First Bank, Boise, Idaho, received a rating of "satisfactory."
20. U.S. Bancorp's banks offer a portfolio home loan program called
HomePartners U.S. that features qualifying criteria that are more
expansive than secondary market standards.
velopment, and the financial support of non-profit
organizations engaged in community development, building affordable housing, and providing educational programs to small businesses and home buyers.
U.S. Bancorp also has adopted a fair lending policy and a
comprehensive fair lending implementation plan. These
include comparative file reviews and matched pair testing
and a second review program. U.S. Bancorp employs a Fair
Lending Program Manager, who is responsible for directing efforts under the fair lending implementation plan and
for fair lending initiatives, procedures, and program development for all of U.S. Bancorp's subsidiary banks. The
subsidiary banks track and analyze lending activity to
ensure reasonable credit distribution and to evaluate fair
lending performance. Lending activity reportable under the
Home Mortgage Disclosure Act ("HMDA") is analyzed
using population levels of minorities, approval and denial
ratios among minorities and non-minorities, and applicant
income levels.
U.S. Bancorp has a marketing program in place at each
of its subsidiary banks, which involve the use of television,
radio, print, direct mail, sponsorships, educational seminars, community events. U.S. Bancorp's subsidiary banks
have developed specific advertising programs for low- and
moderate-income areas and individuals, small businesses,
and small farms. Print adds are placed in publications
directed toward minority applicants and advertising has
been conducted in languages other than English. Multilingual and multicultural loan officers also are recruited in
order to better reach diverse markets.
C. Branch Closure Policies and Practices
U.S. Bancorp's subsidiary banks operate under a branch
closure consolidation policy that would apply to the subsidiaries of West One. This policy requires extensive research
to be conducted before reaching a decision to close a
branch, including consideration of any low- to moderateincome neighborhoods, rural areas, small businesses and
small farms that might be affected by a branch closure. U.S.
Bancorp solicits information directly from the community
about the potential impact of a proposed branch closure.
These contacts include individuals representing low- to
moderate-income constituencies, small businesses, small
farms, and senior citizens. The policy requires that, should
the impact of a branch closure be more than minimal, an
action plan be developed to minimize the impact.
Recent amendments to the Federal Deposit Insurance
Act require an insured depository institution to submit a
notice of any proposed branch closing to the appropriate
federal banking agency no later than 90 days before the
date of the proposed branch closing. 21 The Board also
notes that branch closings by U.S. Bancorp, particularly in
21. See section 228 of the Federal Deposit Insurance Corporation
Improvement Act of 1991, adding a new section 42 to the Federal
Deposit Insurance Act (12 U.S.C. § 1831r-l). Customers of the insured depository institution also are required to be notified.
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low- and moderate-income neighborhoods, will be assessed by examiners in the institution's CRA performance
evaluation, and will be reviewed by the Board in future
applications to acquire a depository facility.
D. Conclusion Regarding Convenience and Needs
Factors
The Board has carefully considered the entire record, including the comments filed, in reviewing the convenience
and needs factors under the BHC Act. After a review of the
entire record of performance, including information provided by Commenters, U.S. Bancorp and West One, and
the CRA performance examinations and other information
from the banks' primary supervisors, the Board concludes
that the efforts of U.S. Bancorp and West One to help meet
the credit needs of all segments of the communities served
by their subsidiary banks, including low- and moderateincome neighborhoods, are consistent with approval. For
these reasons, and based on all the facts of record, the
Board concludes that convenience and needs considerations, including the CRA performance records of the
companies and banks involved in these proposals, are
consistent with approval of these applications.
Other
Considerations
The Board also has concluded that the financial and managerial resources and future prospects of U.S. Bancorp, West
One, and their respective subsidiaries, are consistent with
approval of this proposal as are the other supervisory
factors the Board must consider under section 3 of the
BHC Act. 22
22. The Board has carefully reviewed comments alleging a number
of improper actions by West One Bank, Idaho ("Bank"), and its
parent holding company, West One. Commenter's allegations against
Bank for the most part involve actions and activities engaged in by the
bank while it was a nationally chartered institution, and before it
became a state member bank in 1992. Commenters have presented
these allegations to the OCC for consideration. In addition, Commenters have litigated their claims in connection with foreclosure proceedings by Bank in a court that had the authority to provide Commenters
with appropriate remedies, if improper actions could have been substantiated. That court did not grant relief to Commenters. Contrary to
Commenter's allegations, West One and its predecessor have received
all required approvals from the Federal Reserve System to form a
bank holding company and to make acquisitions of other banking
organizations. Although West One's license to conduct business in
Idaho lapsed between November 1981 and April 1982, the Idaho
Secretary of State has confirmed that the company's authority to
conduct business was not suspended for this technical default. The
Board also has considered this matter in light of all the facts of record,
including reports of examination assessing the managerial strength of
U.S. Bancorp and West One and their subsidiary banks. The Board
notes that after consummation, West One would be integrated into the
management structure of U.S. Bancorp and subject to its policies and
procedures. In light of all the facts of record, including information
provided by federal and state law enforcement and securities regulatory agencies, the Board concludes that these comments do not
warrant denial of this proposal.
Nonbanking
181
Activities
U.S. Bancorp also has given notice, pursuant to section
4(c)(8) of the BHC Act, of its proposal to acquire subsidiaries of West One engaged in certain mortgage, credit and
non-credit related insurance, and trust activities. The Board
has previously determined by regulation or order that the
proposed activities are closely related to banking for purposes of section 4(c)(8) of the BHC Act. U.S. Bancorp has
committed that it will conduct these activities in accordance with the Board's regulations and orders approving
these activities for bank holding companies. In every case
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 those
resources. 23 Based on all the facts of record, the Board has
concluded that financial and managerial considerations are
consistent with approval.
In order to approve this notice, the Board also must
determine that the performance of the proposed nonbanking 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). On
the basis of the record, the Board believes that this proposal should enable U.S. Bancorp to provide greater convenience and improved services to its customers and to
customers of West One's nonbank subsidiaries. In considering U.S. Bancorp's acquisition of West One's nonbanking activities, the record in this case indicates that there are
numerous providers of these nonbanking services, and
there is no evidence in the record to indicate that consummation of this proposal is likely to result in any significantly adverse effects, such as undue concentration of
resources, decreased or unfair competition, conflicts of
interests, or unsound banking practices that would outweigh the public benefits of this proposal. Accordingly, the
Board has determined that the balance of public interest
factors it must consider under section 4(c)(8) of the BHC
Act is favorable and consistent with approval.
Conclusion
Based on the foregoing, including U.S. Bancorp's commitments to the Board, and in light of all the facts of record,
the Board has determined that these applications and notices should be, and hereby are, approved. 24 The Board's
23. See 12 C.F.R. 225.24. See also The Fuji Bank, Limited, 75
Federal Reserve Bulletin 94 (1989); Bayerische Vereinsbank AG, 73
Federal Reserve Bulletin 155 (1987).
24. Two commenters have requested that the Board suspend the
proposed applications until their allegations of managerial wrongdoing by the predecessors of West One can be investigated. The Board is
required under applicable law and the Board's processing procedures
to act on applications submitted under the BHC Act within specified
time periods. Based on all the facts of record, and for the reasons
previously discussed, the Board concludes that delay of this proposal
is not warranted, and that the record is sufficient to act on this
proposal.
182
Federal Reserve Bulletin • February 1996
approval is specifically conditioned on compliance by
U.S. Bancorp with all commitments made in connection
with these applications.
The Board's determinations on the nonbanking activities
to be conducted by U.S. Bancorp are subject to all the
conditions in the Board's Regulation Y and to the Board's
authority to require such modification or termination of the
activities of a holding company or any of its subsidiaries as
the Board finds necessary to assure compliance with, or to
prevent evasion of, the provisions and purposes of the
BHC Act and the Board's regulations and orders issued
thereunder. The commitments and conditions relied on by
the Board in reaching this decision are deemed to be
conditions imposed in writing by the Board in connection
with its findings and decision, and, as such, may be enforced in proceedings under applicable law.
The acquisition of West One's subsidiary banks shall not
be consummated before the fifteenth calendar day following the effective date of this order, and the banking and the
nonbanking transactions shall not be consummated later
than three months following 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 11, 1995.
Voting for this action: Chairman Greenspan, and Governors Lindsey, Phillips, and Yellen. Absent and not voting: Vice Chairman
Blinder and Governor Kelley.
proximately 34 percent of state deposits, and would remain
the largest depository institution in the state.
Local hanking markets where U.S. Bancorp and West
One compete.
Boise
Lewiston
Nampa
Moscow/Pullman
Boise Ranally Metro Area ("RMA")
Lewiston RMA
Nampa RMA and the cities of Parma
and Wilder
Moscow, Idaho, and the cities of Pullman, Colfax, and Palouse in the State
of Washington
Oregon
U.S. Bancorp controls deposits of approximately $7.6 billion, representing approximately 30 percent of all state
deposits, and is the largest depository institution. West One
controls deposits of approximately $1.1 billion, representing approximately 4 percent of state deposits, and is the
sixth largest depository institution. Upon consummation of
this proposal, U.S. Bancorp would control deposits of
approximately $8.8 billion, representing approximately
34 percent of state deposits, and would remain the largest
depository institution in the state. Upon completion of the
proposed branch divestitures, U.S. Bancorp would control
deposits of approximately $8.2 billion, representing
32 percent of state deposits, and would remain the largest
depository institution in the state.
JENNIFER J. JOHNSON
Deputy Secretary of the Board
Local banking markets where U.S. Bancorp and West
One compete.
Appendix A
Deposit Size, Percentage of Deposits, and Ranking for U.S.
Bancorp and West One in the States Where They Compete 1
Corvallis
Eugene
Portland
Local Banking Markets Defined
Salem
Idaho
U.S. Bancorp controls deposits of approximately
$75.2 million, representing less than one percent of all
deposits in depository institutions in the state ("state deposits"), and is the 14th largest depository institution. West
One controls deposits of approximately $3.1 billion, representing approximately 34 percent of state deposits, and is
the largest depository institution. Upon consummation of
this proposal, U.S. Bancorp would control deposits of
approximately $3.2 billion, representing approximately
34 percent of state deposits, and would become the largest
depository institution in the state. Upon completion of the
proposed branch divestiture, U.S. Bancorp would control
deposits of approximately $3.1 billion, representing ap-
1. All deposit data are as of June 30, 1994.
Deschutes
Jefferson
Lincoln
Wasco
Ontario
Pendleton
Corvallis RMA
Eugene RMA
Portland RMA and the cities of Mount
Angel, Scappoose, Saint Helens, and
Veronia
Salem RMA and the cities of Dallas,
Silverton, and Stayton
Deschutes County
Jefferson County
Lincoln County
Wasco County
Malheur County, Oregon; and the cities of Fruitland, New Plymouth, Payette, and Weiser, Idaho
The cities Athena, Hermiston, Pendleton, Pilot Rock, Stanfield, Umatilla,
and Weston
Washington
U.S. Bancorp controls deposits of approximately $4.9 billion, representing approximately 10 percent of all state
deposits, and is the fourth largest depository institution.
West One controls deposits of approximately $1.7 billion,
Legal Developments
representing approximately 3 percent of state deposits, and
is the sixth largest depository institution. Upon consummation of this proposal, U.S. Bancorp would control deposits
of approximately $6.6 billion, representing approximately
13 percent of state deposits, and would become the third
largest depository institution in the state. Upon completion
of the proposed branch divestitures, U.S. Bancorp would
control deposits of approximately $6.5 billion, representing
13 percent of state deposits, and would become the fourth
largest depository institution in the state.
Local banking markets where U.S. Bancorp and West
One compete.
Bellingham
Bremerton
Olympia
PascoKennewickRichland
Seattle
Spokane
Yakima
Kittitas
Skagit
Bellingham RMA and the cities of
Blain, Everson, Lynden, and Sumas
Bremerton RMA
Olympia RMA
Pasco-Kennewick-Richland RMA
Seattle RMA
Spokane RMA and Fairchild Air Force
Base, Washington, and the cities of
Coeur d'Alene, Hayden Lake, and
Rathdrum, Idaho
Yakima RMA
Kittitas County
Skagit County
ORDERS ISSUED UNDER BANK MERGER
ACT
Wellington State Bank
Wellington, Texas
Order Approving the Merger of Banks and
of Bank Branches
Establishment
Wellington State Bank, Wellington, Texas ("Bank"), a
state member bank, has applied under section 18(c) of the
Federal Deposit Insurance Act (12 U.S.C. § 1828(c)) (the
"Bank Merger Act") to purchase certain assets and assume
certain liabilities of two branches of Bank of America
Texas, N.A., Irving, Texas ("BOA-Texas Branches"). 1
Bank also has applied under section 9 of the Federal
Reserve Act (12 U.S.C. § 321) to establish branch offices
at the current locations of the BOA-Texas Branches.
Notice of the applications, affording interested persons
an opportunity to submit comments, has been given in
accordance with the Bank Merger Act and the Board's
Rules of Procedure (12 C.F.R. 262.3(b)). As required by
the Bank Merger Act, reports on the competitive effects of
1. Bank would acquire the Childress Branch of BOA-Texas located
at 423 N. Main, Childress, Texas, and the Memphis Branch of
BOA-Texas located at 119 S. 6th Street, Memphis, Texas.
183
the merger were requested from the United States Attorney
General, the Office of the Comptroller of the Currency, and
the Federal Deposit Insurance Corporation. The time for
filing comments has expired, and the Board has considered
the applications and all the facts of record in light of the
factors set forth in the Bank Merger Act and the Federal
Reserve Act.
Bank, a wholly owned subsidiary of WSB Bancshares,
Inc., Wellington, Texas ("Bancshares"), operates in the
Collingsworth County banking market. 2 The Memphis
Branch of BOA-Texas operates in the Hall County banking
market 3 and the Childress Branch of BOA-Texas operates
in the Childress County banking market. 4 Bank does not
operate in either of these two markets. Based on all the
facts of record, the Board concludes that consummation of
this proposal would not have any significantly adverse
effect on competition or the concentration of banking resources in any relevant banking market. 5
The Board also concludes that the financial and managerial resources and future prospects of Bank are consistent
with approval, as are the other supervisory factors that the
Board is required to consider under the Bank Merger Act
and the Federal Reserve Act. Considerations relating to the
convenience and needs of the communities to be served
also are consistent with approval. 6
Based on the foregoing and all the facts of record, the
Board has determined that these applications should be,
and hereby are, approved. The Board's approval of this
proposal is specifically conditioned on compliance by Bank
with all commitments made in connection with these applications. For purposes of this action, the commitments and
conditions relied on by the Board in reaching this decision
are deemed to be conditions imposed in writing by the
Board and, as such, may be enforced in proceedings under
applicable law.
This transaction may not be consummated before the
fifteenth calendar day following the effective date of this
order, or later than three months after the effective date of
2. The Collingsworth County banking market is approximated by
Collingsworth County, Texas.
3. The Hall County banking market is approximated by Hall County,
Texas.
4. The Childress County banking market is approximated by Childress County, Texas.
5. The Board has received and considered comments from a bank in
Childress, Texas, alleging that too many lenders currently operate in
the Childress County banking market in light of its small population.
The Board notes that there is no evidence in the record to indicate that
this proposal would have an adverse effect on the safety and soundness of Bancshares or Bank. In addition, the number of competitors
would remain the same because Bank does not currently operate in the
Childress County banking market. The promotion of competition by
maintaining the current number of competitors is a positive factor in
evaluating proposals under the Bank Merger Act. Based on all the
facts of record, including relevant reports of examination, the Board
concludes that these comments do not raise adverse considerations
under the statutory factors that the Board is required to consider.
6. Bank received a "satisfactory" rating from the Federal Reserve
Bank of Dallas for performance under the Community Reinvestment
Act in its most recent examination, as of June 1995.
184
Federal Reserve Bulletin • February 1996
this order, unless such period is extended by the Board or
by the Federal Reserve Bank of Dallas, acting pursuant to
delegated authority.
By order of the Board of Governors, effective December 6, 1995.
ACTIONS
TAKEN UNDER SECTIONS 5(d)(3)
By Federal Reserve
AND 18(C)
Voting for this action: Chairman Greenspan, Vice Chairman
Blinder, and Governors Kelley, Phillips, and Yellen. Absent and not
voting: Governor Lindsey.
JENNIFER J. JOHNSON
Deputy Secretary of Board
OF THE FEDERAL DEPOSIT INSURANCE
ACT
Banks
Recent applications have been approved by the Federal Reserve Banks as listed below. Copies are available upon request to
the Reserve Banks.
Acquiring Bank(s)
Acquired Thrift
Reserve Bank
Approval Date
Fifth Third Bank of Northern
Kentucky, Inc.,
Covington, Kentucky
Kentucky Enterprise Bank, F.S.B.,
Newport, Kentucky
Cleveland
December 21, 1995
APPLICATIONS
APPROVED
By Federal Reserve
UNDER BANK HOLDING
COMPANY
ACT
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)
Bank(s)
Reserve Bank
Effective Date
Alabama National BanCorporation,
Shoal Creek, Alabama
Ameribank Corporation,
Shawnee, Oklahoma
Arkansas National Bancshares, Inc.
Bentonville, Arkansas
Bank Corporation of Georgia,
Macon, Georgia
BankWest Nevada Corporation,
Las Vegas, Nevada
BOK Financial Corporation,
Tulsa, Oklahoma
National Commerce Corporation,
Birmingham, Alabama
United Oklahoma Bankshares, Inc.,
Del City, Oklahoma
Arkansas National Bank,
Bentonville, Arkansas
Effingham Bank & Trust,
Rincon, Georgia
BankWest of Nevada,
Las Vegas, Nevada
Security National Bancshares of
Sapulpa, Inc.,
Sapulpa, Oklahoma
Chaparral Delaware Bancshares, Inc.,
Dover, Delaware
Canyon Creek National Bank,
Richardson, Texas
Canyon Creek National Bank,
Richardson, Texas
Atlanta
December 1, 1995
Kansas City
December 13, 1995
St. Louis
December 5, 1995
Atlanta
December 19, 1995
San Francisco
December 20, 1995
Kansas City
November 27, 1995
Dallas
December 8, 1995
Dallas
December 8, 1995
Cleveland
December 11, 1995
Atlanta
December 15, 1995
Chaparral Bancshares, Inc.,
Richardson, Texas
Chaparral Delaware Bancshares,
Inc.,
Dover, Delaware
Citizens Bancshares, Inc.,
Salineville, Ohio
Citizens Community Bancorp, Inc.,
Marco Island, Florida
Western Reserve Bank of Ohio,
Lowellville, Ohio
Citizens Community Bank of Florida,
Marco Island, Florida
Legal Developments
185
Section 3—Continued
Applicant(s)
Bank(s)
Reserve Bank
Effective Date
Community Bancshares of
Mississippi, Inc.,
Forest, Mississippi
Community Bancshares of
Mississippi, Inc., Employee
Stock Ownership Plan,
Forest, Mississippi
Community First Bancorp, Inc.,
Reynoldsville, Pennsylvania
Community Bancshares of Indianola,
Indianola, Mississippi
Atlanta
November 29, 1995
The First National Bank of
Reynoldsville,
Reynoldsville, Pennsylvania
S.B.T. Bancshares, Inc.,
San Marcos, Texas
Cory don Bancorporation,
Corydon, Iowa
Founders Trust National Bank,
Sioux Falls, South Dakota
Farmers State Bank of Huntley,
Huntley, Minnesota
Cleveland
December 13, 1995
Dallas
December 8, 1995
Chicago
December 6, 1995
Minneapolis
December 11, 1995
Minneapolis
December 7, 1995
Kansas City
December 14, 1995
Richmond
December 13, 1995
Richmond
December 4, 1995
Atlanta
December 7, 1995
Dallas
December 11, 1995
St. Louis
December 21, 1995
Chicago
December 12, 1995
Kansas City
December 5, 1995
New York
November 29, 1995
St. Louis
November 28, 1995
Kansas City
December 4, 1995
Kansas City
December 4, 1995
Richmond
December 21, 1995
Dallas
December 8, 1995
Cullen/Frost Bankers, Inc.,
San Antonio, Texas
Dentel Bancorporation,
Victor, Iowa
Empire Bancshares, Incorporated,
Sioux Falls, South Dakota
Farmers & Merchants Financial
Services, Inc.,
St. Paul, Minnesota
FCB Holding, Inc.,
Guthrie, Oklahoma
FCFT, Inc.,
Princeton, West Virginia
First Charter Corporation,
Concord, North Carolina
FirstFed Bancorp, Inc.,
Bessemer, Alabama
First Financial Bankshares, Inc.,
Abilene, Texas
First National Security Company,
DeQueen, Arkansas
F&M Bancorporation,
Kaukauna, Wisconsin
FSC Bancshares, Inc.,
Cameron, Missouri
Great Falls Bancorp,
Totowa, New Jersey
Lonoke Bancshares, Inc.,
Lonoke, Arkansas
Mackey BanCo, Inc.,
Ansley, Nebraska
Metropolitan Bancshares, Inc.,
Aurora, Colorado
NationsBank Corporation,
Charlotte, North Carolina
NationsBank Texas Bancorporation,
Charlotte, North Carolina
The New Galveston Company,
Wilmington, Delaware
First Capital Bancorp, Inc.,
Guthrie, Oklahoma
First Community Bank of Mercer
County, Inc.,
Princeton, West Virginia
Bank of Union,
Monroe, North Carolina
First State Bank of Bibb County,
West Blocton, Alabama
Weatherford National Bancshares, Inc.
Weatherford, Texas
Parker Bancshares, Inc.,
Dover, Delaware
American State Bancshares, Inc.,
Broken Bow, Oklahoma
Monycor Bancshares, Inc.,
Ashland, Wisconsin
Farmers and Valley Bank,
Tarkio, Missouri
Bergen Commercial Bank,
Paramus, New Jersey
First State Bank of Gurdon,
Gurdon, Arkansas
Security State Bank,
Ansley, Nebraska
Wally Bancorp, Inc.,
Parker, Colorado
Interim Sun World, National
Association,
El Paso, Texas
S.B.T. Bancshares, Inc.,
San Marcos, Texas
186
Federal Reserve Bulletin • February 1996
Section 3—Continued
Applicant(s)
Bank(s)
Reserve Bank
Effective Date
Northern California Bancorp, Inc.,
Monterey, California
Norwest Corporation,
Minneapolis, Minnesota
Omega City Holding Company,
LaMoure, North Dakota
Padgett Agency, Inc.,
Greenleaf, Kansas
Passumpsic Bancorp,
St. Johnsbury, Vermont
Peoples Holding Corporation,
Minden, Louisiana
Quantum Capital Corp.,
Suwanee, Georgia
Regions Financial Corporation,
Birmingham, Alabama
Regions Financial Corporation,
Birmingham, Alabama
Rocky Mountain Bancorporation,
Inc.,
Billings, Montana
RMBI Acquisition, Inc.,
Billings, Montana
Security National Corporation,
Sioux City, Iowa
Monterey County Bank,
Monterey, California
Irene Bancorporation, Inc.,
Sioux Falls, South Dakota
Marion Bank Holding Company,
Marion, North Dakota
Lansing Financial Corporation, Inc.,
Lansing, Kansas
Passumpsic Savings Bank,
St. Johnsbury, Vermont
First State Bank & Trust Company,
Plain Dealing, Louisiana
Quantum National Bank,
Suwanee, Georgia
Enterprise National Bank of Atlanta,
Dunwoody, Georgia
Metro Financial Corporation,
Atlanta, Georgia
N.E. Montana Bancshares, Inc.,
Plentywood, Montana
San Francisco
November 28, 1995
Minneapolis
December 5, 1995
Minneapolis
December 6, 1995
Kansas City
December 15, 1995
Boston
December 1, 1995
Dallas
November 28, 1995
Atlanta
December 6, 1995
Atlanta
December 21, 1995
Atlanta
December 1, 1995
Minneapolis
December 15, 1995
Chicago
December 11, 1995
St. Louis
December 15, 1995
New York
December 8, 1995
Chicago
December 15, 1995
The Templar Fund, Inc.,
St. Louis, Missouri
Tompkins County Trustco, Inc.,
Ithaca, New York
United Community Bancorp, Inc.,
Chatham, Illinois
Sheldon Security Bancorporation, Inc.,
Sheldon, Iowa
Sheldon Security Financial Corporation,
Sheldon, Iowa
Security State Bank,
Sheldon, Iowa
Truman Bank,
St. Louis, Missouri
Tompkins County Trust Company,
Ithaca, New York
State Bank of Auburn,
Auburn, Illinois
Legal Developments
187
Section 4
Applicant(s)
Nonbanking Activity/Company
Reserve Bank
Effective Date
Bridgeport Financial Corporation,
Bridgeport, Texas
Bridgeport Bancshares, Inc.,
Dover, Delaware
CNB Bancshares, Inc.,
Evansville, Indiana
Bridgeport Securities Corporation,
Bridgeport, Texas
Dallas
December 20, 1995
Service Financial, Inc.,
Harriman, Tennessee
Southern Finance Company, Inc.,
Madisonville, Kentucky
Crestar Securities Corporation,
Richmond, Virginia
Kentucky Enterprise Bancorp, Inc.,
Newport, Kentucky
First Federal Savings Bank,
Bessemer, Alabama
To engage de novo in direct lending
St. Louis
November 24, 1995
Richmond
November 24, 1995
Crestar Financial Corporation,
Richmond, Virginia
Fifth Third Bancorp,
Cincinnati, Ohio
FirstFed Bancorp, Inc.,
Bessemer, Alabama
Forstrom Bancorporation, Inc.,
Clara City, Minnesota
Guaranty Bankshares, Inc.,
Cedar Rapids, Iowa
Old Kent Financial Corporation,
Grand Rapids, Michigan
Otto Bremer Foundation,
St. Paul, Minnesota
Bremer Financial Corporation,
St. Paul, Minnesota
Premier Financial Services, Inc.,
Freeport, Illinois
Republic Bancorp, Inc.,
Owosso, Michigan
Stichting Priorieteit ABN AMRO
Holding,
Amsterdam, The Netherlands
Stichting Administratiekantoor ABN
AMRO Holding,
Amsterdam, The Netherlands
ABN AMRO Holding, N.V.,
Amsterdam, The Netherlands
ABN AMRO Bank N.V.,
Amsterdam, The Netherlands
Neville Leasing, Inc.,
Atlanta, Georgia
Summit Financial Corporation,
Greenville, South Carolina
To engage in leasing activities and
making and servicing loans
Republic Mortgage Corporation,
Salt Lake City, Utah
United Insurance Agency, Inc.,
Minot, North Dakota
Cleveland
Atlanta
Minneapolis
Chicago
Chicago
Minneapolis
December 21, 1995
December 8, 1995
December 19, 1995
December 5, 1995
December 19, 1995
December 19, 1995
Premier Insurance Services, Inc.,
Warren, Illinois
Premier Partners-James R. Gary
Realtors,
Woodland Hills, California
Chicago
December 21, 1995
Chicago
December 19, 1995
Chicago
November 29, 1995
Domestic Loans, Inc.,
Manning, South Carolina
A + Loans, Inc.,
Manning, South Carolina
Richmond
December 8, 1995
188
Federal Reserve Bulletin • February 1996
Sections 3 and 4
Applicant(s)
Nonbanking Activity/Company
Reserve Bank
Effective Date
FW Financial, Inc.,
Huron, South Dakota
First Western Bancorp, Inc.,
Huron, South Dakota
First Western Agency, Inc.,
Huron, South Dakota
Minneapolis
November 28, 1995
APPLICATIONS APPROVED
By Federal Reserve
UNDER BANK MERGER ACT
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(s)
Reserve Bank
Effective Date
BancFirst,
Oklahoma City, Oklahoma
Bank of Essex,
Tappahannock, Virginia
Baylake Bank-Kewaunee,
Kewaunee, Wisconsin
Barnett Bank of Polk County,
Lakeland, Florida
City Bank & Trust Company,
Oklahoma City, Oklahoma
First Union National Bank of Virginia,
Roanoke, Virginia
Baylake Bank,
Sturgeon Bay, Wisconsin
First Federal Savings & Loan
Association of Lake Wales,
Lake Wales, Florida
Talladega Federal Savings & Loan
Association,
Talladega, Alabama
The Huntington National Bank of
Pennsylvania,
Uniontown, Pennsylvania
Kentucky Enterprise Bank, F.S.B.,
Newport Kentucky
Kansas City
December 5, 1995
Richmond
December 21, 1995
Chicago
November 30, 1995
Atlanta
December 1, 1995
Atlanta
December 1, 1995
Cleveland
November 21, 1995
Cleveland
December 21, 1995
First Community Bank, Inc.,
Princeton, West Virginia
Richmond
December 13, 1995
Hawkeye Bank of Ankeny,
Ankeny, Iowa
Northern Trust Bank/O'Hare, N.A.,
Chicago, Illinois
Northern Trust Bank/Lake Forest, N.A.,
Lake Forest, Illinois
Northern Trust Bank/DuPage,
Oakbrook Terrace, Illinois
Century Bank, F.S.B.,
Sarasota, Florida
First Union National Bank of North
Carolina,
Charlotte, North Carolina
NBD Bank,
Detroit, Michigan
Chicago
November 30, 1995
Chicago
November 21, 1995
Atlanta
November 30, 1995
Richmond
December 1, 1995
Chicago
November 29, 1995
Citizens Bank of Talladega,
Talladega, Alabama
Fayette Bank,
Uniontown, Pennsylvania
Fifth Third Bank of Northern
Kentucky, Inc.,
Covington, Kentucky
First Community Bank of Mercer
County, Inc.,
Princeton, West Virginia
Hawkeye Bank,
Des Moines, Iowa
The Northern Trust Company,
Chicago, Illinois
Republic Security Bank,
West Palm Beach, Florida
Triangle Bank,
Raleigh, North Carolina
Tri-County Bank,
Brown City, Michigan
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.
Menick v. Greenspan, No. 95-CV-01916 (D. D.C., filed October 10, 1995). Complaint alleging sex, age, and handicap
discrimination in employment.
Kuntz v. Board of Governors, No. 95-1495 (D.C. Cir., filed
September 21, 1995). Petition for review of Board order
dated August 23, 1995, approving the applications of The
Fifth Third Bank, Cincinnati, Ohio, to acquire certain assets
and assume certain liabilities of 12 branches of PNC Bank,
Ohio, N.A., Cincinnati, Ohio, and to establish certain
branches. The Board's motion to dismiss was filed on
October 26, 1995.
Lee v. Board of Governors, No. 94-4134 (2nd Cir., filed
August 22, 1995). Petition for review of Board orders dated
July 24, 1995, approving certain steps of a corporate reorganization of U.S. Trust Corporation, New York, New York,
and the acquisition of U.S. Trust by Chase Manhattan
Corporation, New York, New York. On September 12,
1995, the court denied petitioners' motion for an emergency
stay of the Board's orders.
Jones v. Board of Governors, No. 95-1359 (D.C. Cir., filed
July 17, 1995). Petition for review of a Board order dated
June 19, 1995, approving the application by First Commerce Corporation, New Orleans, Louisiana, to acquire
Lakeside Bancshares, Lake Charles, Louisiana. On November 15, 1995, the court granted the Board's motion to
dismiss.
Beckman v. Greenspan, No. 95-35473 (9th Cir., filed May 4,
1995). Appeal of dismissal of action against Board and
others seeking damages for alleged violations of constitutional and common law rights. The appellants' brief was
filed on June 23, 1995; the Board's brief was filed on July
12, 1995.
Board of Governors v. Hotchkiss, Adversary No. 95-3146
(Bankr. N.D. Ohio, filed May 1, 1995). Action to declare a
restitution obligation arising from a Board consent order
non-dischargeable in bankruptcy. On December 15, 1995,
the court granted the Board's motion for summary judgment.
Money Station, Inc. v. Board of Governors, No. 95-1182
(D.C. Cir., filed March 30, 1995). Petition for review of a
Board order dated March 1, 1995, approving notices by
Bank One Corporation, Columbus, Ohio; CoreStates Financial Corp., Philadelphia, Pennsylvania; PNC Bank Corp.,
Pittsburgh, Pennsylvania; and KeyCorp, Cleveland, Ohio,
to acquire certain data processing assets of National City
Corporation, Cleveland, Ohio, through a joint venture subsidiary. The Board's brief was filed November 16, 1995.
Oral argument is scheduled for February 2, 1996.
Jones v. Board of Governors, No. 95-1142 (D.C. Cir., filed
March 3, 1995). Petition for review of a Board order dated
February 2, 1995, approving the applications by First Com-
189
merce Corporation, New Orleans, Louisiana, to merge with
City Bancorp, Inc., New Iberia, Louisiana, and First Bankshares, Inc., Slidell, Louisiana. The Board's brief was filed
December 22, 1995. Oral argument on the petition for
review is scheduled for February 27, 1996.
In re Subpoena Duces Tecum, Misc. No. 95-06 (D.D.C., filed
January 6, 1995). Action to enforce subpoena seeking predecisional supervisory documents sought in connection with
an action by Bank of New England Corporation's trustee in
bankruptcy against the Federal Deposit Insurance Corporation. The Board filed its opposition on January 20, 1995.
Oral argument on the motion was held July 14, 1995.
Board of Governors v. Ghaith R. Pharaon, No. 91-CIV-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.
FINAL ENFORCEMENT DECISION ISSUED BY THE BOARD
OF
GOVERNORS
In the Matter of
Professional Bank
Denver, Colorado
DOCKET No. 95-007-B-SM
Final Decision and Order
This is an administrative proceeding pursuant to the Federal Deposit Insurance Act ("FDI Act"), brought by the
Board of Governors of the Federal Reserve System
("Board") against the Professional Bank, Denver, Colorado ("Bank") in which the Board seeks to issue a cease
and desist order requiring Bank to take affirmative action to
correct the conditions resulting from certain violations of
law and unsafe and unsound practices. This proceeding
comes to the Board in the form of a Recommended Decision by Administrative Law Judge ("ALJ") Walter J. Alprin recommending that the Board issue a Cease and Desist
Order against Bank by default pursuant to the provisions of
12 U.S.C. § 1818(b) and 12 C.F.R. 263.19(c).
Upon review of the administrative record, the Board
issues this Final Decision adopting the ALJ's Recommended Decision and orders that the attached Cease and
Desist Order issue against Bank.
I. Statement of the Case
A. Procedural
History
On April 25, 1995, the Board issued a Notice of Charges
and of Hearing ("Notice") against Bank pursuant to the
provisions of 12 U.S.C. § 1818(b). The Notice alleged that
190
Federal Reserve Bulletin • February 1996
Bank had engaged in unsafe and unsound practices by
concentrating an unduly high percentage of its capital in
loans to its sole shareholder, Oren Benton, and his family
members and related business entities (the "Benton
Loans") and by issuing a large number of certificates of
deposit at well above prevailing market interest rates. The
Notice further alleged that Bank had violated the Board's
Regulation O, 12 C.F.R. 215, which places restrictions on
loans by state member banks to their executive officers,
directors and principal shareholders, by making Benton
Loans in excess of applicable lending limits, by making at
least one Benton Loan on preferential terms and by extending several indirect Benton Loans without the prior approval of Bank's board of directors. Last, the Notice alleged that Bank had violated sections 23A and 23B of the
Federal Reserve Act, 12 U.S.C. §§ 371c and 371c-l, by
exceeding the Act's limits on covered transactions to affiliates, by failing to meet the Act's collateral requirements
and by entering into transactions with affiliates that were
not on an arms'-length basis or in the Bank's best interests.
All of the above-mentioned affiliates were Benton-related
entities.
Bank was personally served with the Notice by an officer
of the Federal Reserve Bank of Kansas City ("Reserve
Bank") on April 26, 1995 at a meeting with Bank's president, outside counsel and board of directors. In accordance
with the Uniform Rules of Practice and Procedure ("Uniform Rules"), which are applicable to this proceeding,
12 C.F.R. 263.19, the Notice stated that Bank was required
to file an answer within 20 days of service and provided
that its failure to file an answer would constitute a waiver
of Bank's right to appear and contest the allegations in the
Notice. After service of the Notice, Bank's president and
its attorney had several discussions with Board Enforcement Counsel in which they asked Enforcement Counsel
questions regarding the Notice and informed Enforcement
Counsel that Bank was aware that it had 20 days to file an
answer. During one of these discussions, Bank's counsel
informed Enforcement Counsel that Bank was electing not
to file an answer.
On May 4, 1995, the ALJ issued a Scheduling Order
setting a provisional hearing date of June 19, 1995. By
May 17, 1995, the 20th day after service of the Notice,
Bank had not filed an answer. On June 16, 1995, Enforcement Counsel moved for the entry of an order of default
based on Bank's continued failure to file an answer. Enforcement Counsel also filed a proposed cease and desist
order with the ALJ. Bank did not file an opposition to the
motion.
On July 3, 1995, the ALJ issued an order requiring Bank
to show cause why it had failed to file an answer and why a
recommended default order and order to cease and desist
should not be entered against it. Bank was given until
July 11, 1995 to respond to the show cause order. Bank did
not file a response.
On July 27, 1995, the ALJ issued a recommended decision incorporating the factual allegations in the Notice and
recommending that the Board issue Enforcement Coun-
sel's proposed cease and desist order on the grounds that
Bank had not filed an answer and had not shown good
cause for its failure to do so. Bank did not file exceptions to
the ALJ's recommended decision.
B. Statutory and Regulatory
Framework
The FDI Act provides that a banking agency may issue a
cease and desist order against an insured depository institution which is engaging, has engaged or is about to engage
in unsafe or unsound practices in conducting the business
of that institution or is violating, has violated or is about to
violate a law, rule or regulation. 1 12 U.S.C. § 1818(b)(1).
Such an order may require the depository institution to
"cease and desist" from the practice or violation and to
"take affirmative action to correct the conditions resulting
from any such violation or practice." Id.
The Uniform Rules provide that, following the issuance
of a notice of charges, a respondent's failure to file an
answer within the time specified "constitutes a waiver of
his or her right to appear and contest the allegations in the
notice." 12 C.F.R. 263.19(c). If no timely answer is filed,
Enforcement Counsel may file a motion for entry of an
order of default with the ALJ. Id. Upon a finding that
respondent has not shown good cause for his failure to file
a timely answer, the ALJ is directed to file a recommended
order with the Board containing the factual allegations and
the relief sought in the notice. Id. Any final Board order
based on a respondent's failure to file a timely answer is
deemed to be an order issued upon consent. Id. See
12 U.S.C. § 1818(b)(1) (failure to appear at hearing following service of notice is deemed consent to issuance of
cease and desist order).
II. Discussion
In the circumstances of this case, it is clear that the regulatory prerequisites for the issuance of a default order have
been met. The fact that Bank was served by hand with a
copy the notice is supported by the sworn affidavit of a
Reserve Bank officer. Both the Notice and the Uniform
Rules made clear to Bank that its answer was due within 20
days of service of the Notice and that its failure to file an
answer could result in default. Enforcement Counsel attested in its motion for entry of a default order that Bank's
president and attorney informed him in several telephone
conversations that they knew that Bank's answer was due
within 20 days of service. In one such conversation, Bank's
attorney informed Enforcement Counsel that Bank had
elected not to file an answer.
Bank failed to file a response to Enforcement Counsel's
motion for default and its proposed cease and desist order,
1. The term unsafe and unsound banking practice has been defined
to mean " 'conduct deemed contrary to accepted standards of banking
operations which might result in abnormal risk or loss to a banking
institution or shareholder.' " Cavallari v. OCC, 57 F.3d 137, 142
(2d Cir. 1995) (citing First National Bank of Eden v. Department of
the Treasury, 568 F.2d 610, 611 n.2 (8th Cir. 1978)).
Legal Developments
to the ALJ's show cause order and to the ALJ's recommended default order. In short, Bank had repeated opportunities to respond to the charges in the Notice and failed to
do so. There is no basis in the record for an inference that
Bank's failure to file an answer was due to mischance or
inadvertence. The ALJ therefore acted reasonably and in
accordance with the Uniform Rules in finding that no good
cause existed to relieve Bank of the consequences of its
failure to file an answer.
Likewise, the Notice sets forth sufficient facts to support
the conclusion that Bank engaged in unsafe and unsound
practices and violated sections 23A and 23B of the Federal
Reserve Act and Regulation O. The affirmative relief set
forth in the recommended cease and desist order is reasonably calculated to correct the conditions resulting from
these violations and practices and is therefore consistent
with the provisions of the FDI Act.
Conclusion
For these reasons, the Board orders that the attached cease
and desist order issue.
By order of the Board of Governors of the Federal
Reserve System, effective this 7th day of December, 1995.
Board of Governors of the
Federal Reserve System
WILLIAM W. WILES
Secretary of the Board
Final Cease and Desist Order
WHEREAS, the Board of Governors of the Federal Reserve System (the "Board of Governors") issued on
April 25, 1995, a Notice of Charges and of Hearing (the
"Notice") against the Professional Bank, Denver, Colorado (the "Bank") in response to:
(1) The alleged continuing unsafe and unsound practices
and serious violations of law and regulations relating to
the Bank's high level of loans to parties whose ability to
service such loans in a timely manner is dependent upon
the financial success of companies owned or controlled
by the Bank's sole shareholder and former director, and
(2) The Bank's unsafe and unsound practice of funding
its liquidity needs through short term, high interest rate
certificates of deposit;
WHEREAS, in conjunction with the Notice, the Board
of Governors issued a Temporary Order to Cease and
Desist (the "Temporary Order") against the Bank, effective April 26, 1995;
WHEREAS, the Bank failed to file an answer in response to the Notice as required by section 263.19(a) of the
Rules of Practice for Hearings of the Board of Governors
(the "Rules of Practice") (12 C.F.R. 263.19(a)); and
WHEREAS, the Board of Governors, pursuant to section 263.40(c) of the Rules of Practice (12 C.F.R.
263.40(c)) issues its Final Decision, which is attached
191
hereto and made a part hereof, and this Order to Cease and
Desist (the "Order") in the proceeding initiated by the
Notice.
NOW, THEREFORE, the Board of Governors hereby
issues this Order and orders, pursuant to section 8(b) of the
Federal Deposit Insurance Act, as amended (the "FDI
Act") (12 U.S.C. 1818(b)), that:
1. The Bank shall not declare or pay any dividends
without the prior written approval of the Federal Reserve Bank of Kansas City (the "Reserve Bank") and
the Director of the Division of Banking Supervision and
Regulation of the Board of Governors. Requests for
approval shall be received by the Reserve Bank at least
30 days prior to the proposed dividend declaration date
and shall contain, but not be limited to, current and
projected information on earnings, cash flow, capital
levels and asset quality of the Bank.
2. Within 45 days of this Order, the Bank shall submit to
the Reserve Bank an acceptable written plan to achieve,
and, thereafter, maintain an adequate capital position.
The plan shall, at a minimum, address and consider:
(a) The current and future capital requirements of the
Bank, including compliance with the Capital Adequacy Guidelines of the Board of Governors for State
Member Banks: Risk-Based Measure and Tier 1 Leverage Measure (Appendices A and B of Regulation
H of the Board of Governors (12 C.F.R. Part 208,
App. A and B));
(b) The volume of the Bank's adversely classified
assets and the potential for additional asset quality
problems at the Bank;
(c) The Bank's anticipated and unanticipated liquidity
needs;
(d) The Bank's anticipated levels of retained earnings;
(e) The adequacy of the Bank's loan loss reserves and
its effect on the Bank's financial condition; and
(f) The source and timing of additional funds to fulfill
the future capital and loan loss reserve requirements
set forth in this Order, including the sale of shares of
its stock or other obligations, or the acquisition by, or
merger of the Bank with, another insured depository
institution or holding company thereof.
3. Unless otherwise agreed to in writing by the Reserve
Bank, the Bank shall provide the Reserve Bank with at
least 5 days prior written notice of any sale, transfer or
disposition of any asset, line of business or operation of
the Bank where such asset, line of business or operation
has a book value in excess of $1 million. The Reserve
Bank shall have the right to disapprove any such sale,
transfer or disposition, in which case the Bank shall not
proceed with the proposed sale, transfer or disposition.
This paragraph shall not apply to the sale of Fed Funds
or of securities sold under agreement to repurchase.
4. Within 30 days of this Order, the Bank shall submit to
the Reserve Bank an acceptable written plan to provide
for the maintenance of an adequate liquidity position.
The plan shall, at a minimum, address and consider the
following:
192
Federal Reserve Bulletin • February 1996
(a) The maintenance of sufficient liquidity to meet
contractual liability maturities and to meet additional,
unanticipated demands;
(b) The Bank's level of dependence on volatile liabilities, including out-of-territory, money desk and/or
wire service deposits;
(c) The selection of appropriate measures to monitor
the Bank's liquidity position, including quantitative
guidelines to establish adequate coverage of volatile
liabilities by liquid assets; and
(d) The preparation and submission of regular, periodic written reports to the board of directors that
document the Bank's progress in achieving compliance with the plan and that shall include, at a minimum:
(i) a complete review of the Bank's then-current
position in meeting targeted liquidity ratios;
(ii) a schedule of anticipated sources and uses of
funds over future plan horizons;
(iii) an analysis of strategies or steps taken during
the reporting period to address deviations from the
plan; and
(iv) a discussion of contingency plans if actual
sources or uses of funds vary materially from projections.
5. (a) The Bank's board of directors shall continue to
consist of a majority of outside directors.
(b) For the purposes of this Order, the terms:
(i) "outside director" shall be defined, except as
otherwise agreed to in writing by the Reserve Bank,
as an individual who:
(A) is not an employee, officer or agent of the
Bank or of any affiliate,
(B) owns not more than 5 percent of the outstanding voting stock of the Bank or of any
affiliate, or
(C) is not related in any manner to any shareholder who owns more than five percent of the
outstanding voting stock of the Bank or any
related interest of such a shareholder;
(ii) "related interest" shall be defined as set forth in
section 215.2(n) of Regulation O of the Board of
Governors (12 C.F.R. 215.2(n)); and
(iii) "affiliate" shall be defined as set forth in
section 23A(b)(i) of the Federal Reserve Act
(12 U.S.C. 371c(b)(l)).
6. (a) Within 45 days of this Order, the Bank's board of
directors shall conduct a review of the Bank's management structure and the functions and performance
of the officers responsible for the Bank's operational
and financial functions, credit review, and executive
management responsible for the administration of the
Bank's affairs and shall forward to the Reserve Bank
the written findings and conclusions of the review
along with a written description of any management
or operational changes that may be proposed as a
result of the review. The review shall include an
assessment of the duties performed by each officer
and the ability of that officer to perform competently
his or her assigned duties. The primary purpose of this
review shall be to aid in the development of a management structure suitable to the Bank's needs that is
adequately staffed by qualified and trained personnel,
(b) During the term of this Order or as otherwise
required by law, the Bank shall comply with the
provisions of section 32 of the FDI Act (12 U.S.C.
183 li) and Subpart H of Regulation Y of the Board of
Governors (12 C.F.R. Part 225, Subpart H) with respect to the appointment of any new directors or the
hiring or promotion of any senior executive officers.
7. Within 30 days of this Order, the Bank shall submit to
the Reserve Bank an acceptable written plan to reduce
concentrations of credit in the Bank's loan portfolio of
insider-related loans, as identified in the Reserve Bank's
Report of Examination of the Bank, dated January 30,
1995 (the "Report of Examination"). The plan shall
include, at a minimum, the following:
(a) A timetable for reducing the aggregate insiderrelated concentration to a level that fully complies
with the requirements of section 23A of the Federal
Reserve Act (12 U.S.C. 371c) and Regulation O of the
Board of Governors (12 C.F.R. Part 215);
(b) a description of the specific procedures and methods that the Bank will use to reduce the insider-related
loans in accordance with the timetable required by
paragraph 7(a) hereof; and
(c) submission to the Bank's board of directors of
monthly, accurate written reports concerning the
Bank's efforts to reduce the insider-related concentration, which shall be maintained for subsequent supervisory review.
8. Within 45 days of this Order, the Bank shall submit to
the Reserve Bank an acceptable written plan designed to
reduce or improve the Bank's position on each insiderrelated loan and on each loan in excess of $75,000 that
was past due as to principal or interest in excess of
90 days as of the date of this Order and all assets,
including other real estate, adversely classified or listed
for special mention by the Reserve Bank in the Report of
Examination, through amortization, repayment, liquidation, additional collateral or other means, whichever
may be appropriate. This plan shall not be amended or
rescinded without the prior written approval of the Reserve Bank, except that the plan shall be amended periodically to cover loans or other assets in excess of
$75,000 that have been adversely classified or listed for
special mention in any subsequent report of examination
or visitation of the Bank or loans that are past due as to
principal or interest for more than 90 days as of the date
of each subsequent examination or visitation. Amended
plans based on loans or other assets that are classified or
listed for special mention or overdue in subsequent
examinations or visitations shall be submitted to the
Reserve Bank with the next progress report, as required
by paragraph 16 hereof, following each subsequent examination or visitation.
Legal Developments
9. (a) Without the prior written approval of the Reserve
Bank, the Bank shall not, directly or indirectly, make
any extension of credit to, or for the benefit of, any
borrower, including any related interest of the borrower, who is obligated in any manner to the Bank on
any extension of credit or portion thereof that has
been charged-oflf by the Bank or classified "Loss" or
"Doubtful", as identified in the Report of Examination or in any subsequent report of examination or
visitation as long as such credit remains uncollected.
(b) The Bank shall not, directly or indirectly, make
any extension of credit to, or for the benefit of, any
borrower, including any related interest of the borrower, who is obligated in any manner to the Bank on
any extension of credit or portion thereof that has
been classified "Substandard", as identified in the
Report of Examination or in any subsequent report of
examination or visitation, without the prior approval
of the board of directors, who shall document the
reasons for additional advances and who shall certify
that:
(i) the additional extension of credit is necessary to
protect the Bank's interest in the ultimate collection
of the credit already granted;
(ii) the additional extension of credit is adequately
secured and in full compliance with the Bank's
lending limits and written loan policy;
(iii) a thorough credit analysis has been performed
indicating that the extension of credit is reasonable
and justified;
(iv) all necessary loan documentation has been
properly and accurately prepared and filed;
(v) the additional extension will not impair the
Bank's interest in obtaining repayment of the already outstanding credit; and
(vi) the board of directors reasonably believes that
the additional extension of credit will be repaid
according to its terms. The written certification,
together with the credit analysis and related information supporting this certification, shall be maintained by the Bank for subsequent supervisory review.
(c) For purposes of this Order, the term "extension of
credit" shall be defined as set forth in section 215.3 of
Regulation O of the Board of Governors (12 C.F.R.
215.3).
10. Unless otherwise agreed to in writing by the Reserve
Bank, the Bank shall not, directly or indirectly, execute
or enter into any personal service contract with or any
discretionary bonus or incentive plan for, or make any
discretionary bonus, fee or incentive payment to, or
amend any existing personal service contract with or
discretionary bonus or incentive plan for any current or
former director or executive officer, or any related interest thereof, without providing the Reserve Bank with at
least 30 days prior written notice of the proposed contract, plan, payment or amendment. The Reserve Bank
shall have the right to disapprove any such contract,
193
plan, payment or amendment, in which case the Bank
shall not proceed with the proposed contract, plan, payment, or amendment.
(b) For purposes of this paragraph, the terms:
(i) "personal service contract" shall include, but is
not limited to, an employment contract, a consulting agreement or arrangement, a severance package, or an excessive or supplemental retirement
plan; and
(ii) "executive officer" shall be defined as set forth
in section 215.2(e) of Regulation O of the Board of
Governors (12 C.F.R. 215.2(e)).
(c) Notwithstanding the provisions of paragraph 10(a)
hereof and unless otherwise agreed to in writing by
the Reserve Bank, the Bank does not need to obtain the
prior written approval of the Reserve Bank for the payment of directors fees or the reimbursement of reasonable expenses that aggregate no more than $100
per month for each of its then- current directors and
executive officers, provided that such reasonable expenses are incurred in the performance of routine duties,
which have been adequately documented and reported
on the Bank's books and records. For the purpose
of calculating the $100 per month total, reasonable
expenses incurred by a director's or executive officer's related interest will be attributed to such person.
11. (a) Unless otherwise agreed to in writing by the
Reserve Bank, the Bank shall, within 30 days from
the receipt of any report of examination or visitation,
charge off 100 percent of all assets classified "Loss."
(b) The Bank shall continue to maintain, through
charges to current operating income, an adequate valuation reserve for loan losses. The adequacy of the
reserve shall be determined in light of the volume of
weighted classified loans, past loss experience, evaluation of the potential for loan losses in the Bank's
loan portfolio of the Bank, and the requirements of the
Interagency Policy Statement on the Allowance for
Loan and Lease Losses, dated December 21, 1993. A
written record shall be maintained indicating the
methodology used in determining the amount of a
reserve needed. This record shall be submitted to the
Reserve Bank within 15 days of this Order. Thereafter, the Bank shall conduct, at a minimum, a quarterly
assessment of its loan loss reserve and its nonperforming loans and shall submit documentation of each
quarterly assessment to the Reserve Bank within
30 days of the end of each quarter. The Bank shall not
alter or amend its methodology submitted to Reserve
Bank pursuant to this paragraph without providing the
Reserve Bank with 30 days prior written notice.
(c) The requirements of this paragraph shall not be
construed as a standard for future operations of the
Bank after the termination of this Order. It is the
intention of these requirements to provide for an appropriate reduction in adversely classified assets and
to maintain adequate loan loss reserves during the
term of this Order.
194
Federal Reserve Bulletin • February 1996
12. (a) The Bank shall immediately take all necessary
steps, consistent with sound banking practices, to
eliminate and/or correct any outstanding violations of:
(i) sections 23A and 23B of the Federal Reserve
Act (12 U.S.C. 371c, 371c-l»;
(ii) Regulation O of the Board of Governors
(12 C.F.R. Part 215); and
(iii) sections 11-7-103 and 11-3-103 of the Colorado Revised Statutes and CB 101.43, 101.51 and
101.52 of the Colorado Banking Regulations identified in the Report of Examination.
(b) (i) The Bank shall take all actions that are necessary to ensure that all extensions of credit made by
the Bank fully comply with the requirements of
section 23A of the Federal Reserve Act and Regulation O of the Board of Governors, including, but
not limited to, obtaining all necessary information
and documentation to ensure that the proceeds, or
any portion thereof, of any extension of credit are
used, or transferred, in a manner that fully complies
with the requirements of section 23A of the Federal
Reserve Act and Regulation O of the Board of
Governors. Pursuant to the statutory requirements
of section 23A(a)(2) of the Federal Reserve Act
(12 U.S.C. 371c(a)(2)), any transaction, including
extension of credit, with any person where the
proceeds of the transaction are used for the benefit
of, or are transferred to, an affiliate of the Bank are
deemed to be a transaction by the Bank with the
affiliate.
(ii) The Bank shall not engage, directly or indirectly, in any violation of sections 23A and 23B of
the Federal Reserve Act, the Board of Governors'
Regulation O, or applicable provisions of the Colorado Revised Statutes.
(c) Within 45 days of this Order, the Bank shall
develop an acceptable written compliance program
designed to ensure compliance with the provisions of
sections 23A and 23B of the Federal Reserve Act,
Regulation O, the applicable provisions of the Colorado Revised Statutes and this Order, including appointing an individual as compliance officer to be
responsible for coordinating and monitoring compliance with the program at the Bank, and shall submit to
the Reserve Bank a written description of the compliance program. Pursuant to the program, the management and the directors of the Bank shall familiarize
themselves with the applicable provisions of sections
23A and 23B of the Federal Reserve Act, Regulation O, the applicable provisions of the Colorado
Revised Statutes and of this Order.
13. The Bank shall not accept any brokered deposits
except in compliance with the provisions of section 29
of the FDI Act (12 U.S.C. 183 If). The Bank shall notify
the Reserve Bank, in writing, in the event that the Bank
requests any waiver from the Federal Deposit Insurance
Corporation (the "FDIC") of the restrictions imposed by
section 29 and shall notify the Reserve Bank of the
FDIC's disposition of any request for such a waiver.
14. Notwithstanding the requirements of paragraphs 2,
4, 6, 7, 8, 11(b) and 12(c) hereof and upon written notice
from the Reserve Bank, the Bank does not have to
submit the required plans, methodology, description or
program in the event that, as of the date of this Order, the
Bank has made such submissions pursuant to the Temporary Order and, except for the submissions required by
paragraphs 6 and 11(b) hereof, such have been approved
by the Reserve Bank and adopted by the Bank.
15. The plans and program required by paragraphs 2, 4,
7, 8, and 12(c) hereof shall be submitted to the Reserve
Bank for review and approval. Acceptable plans and
program shall be submitted to the Reserve Bank within
the required time periods. The Bank shall submit the
plans and program to the Reserve Bank no later than
20 days prior to the expiration of the applicable time
periods. The Reserve Bank may comment on the plans
and program within 10 days of receipt. The Bank shall
provide the Reserve Bank with revised plans and program, as may be required, within 5 days of receipt of
written comments, if any. Within 5 days of receipt of the
revised plans and program, the Reserve Bank shall communicate in writing its approval or disapproval. The
Bank shall adopt approved plans and program within
10 days of approval by the Reserve Bank and then shall
fully comply with them, or, as applicable, shall fully
comply with all plans and the program submitted pursuant to the Temporary Order and approved by the Reserve
Bank. During the term of this Order, the plans and
program approved pursuant to this Order and, as applicable, the Temporary Order, shall not be amended or
rescinded without the prior written approval of the Reserve Bank.
16. Within 30 days of this Order, and, thereafter, within
30 days of the end of each calendar quarter (September 30, December 31, March 31 and June 30) following
the date of this Order, the Bank shall furnish to the
Reserve Bank written progress reports detailing the form
and manner of all actions taken to secure compliance
with this Order and the results thereof, including updated reports on all liquidity, concentration of credit and
asset improvement plans required by paragraphs 4, 7 and
8 hereof. Such reports may be discontinued when the
corrections required by this Order have been accomplished and the Reserve Bank has, in writing, released
the Bank from making further reports.
17. All communications regarding this Order shall be
sent to:
(a) Mr. James H. Jonson
Vice President
Federal Reserve Bank of Kansas City
925 Grand Boulevard
Kansas City, Missouri 64198
(b) Ms. Barbara M.A. Walker
State Bank Commissioner
Department of Regulatory Agencies
Division of Banking
Legal Developments
1560 Broadway, Suite 1175
Denver, Colorado 80202
(c) Mr. Everett Covington
President
Professional Bank
4100 East Mississippi Avenue
Denver, Colorado 80222
18. The provisions of this Order shall be binding upon
the Bank and its institution-affiliated parties, in their
capacities as such, and their successors and assigns.
19. Notwithstanding any provision of this Order to the
contrary, the Reserve Bank may, in its sole discretion,
grant written extensions of time to the Bank to comply
with any provision of this Order.
20. The provisions of this Order shall not bar, estop or
otherwise prevent the Board of Governors, or any federal or state agency or department from taking any other
195
action affecting Bank or any of its current or former
institution-affiliated parties or their successors or assigns.
21. This Order replaces and terminates the Temporary
Order.
22. Pursuant to section 263.19(c) of the Rules of Practice (12 C.F.R. 263.19(c)), this Order is deemed to be an
order issued upon consent for purposes of sections
8(b)(2) and (h) of the FDI Act (12 U.S.C. 1818(b)(2)
and (h)).
By order of the Board of Governors of the Federal
Reserve System, effective this 7th day of December, 1995.
Board of Governors of the
Federal Reserve System
WILLIAM W. WILES
Secretary of the Board
196
Membership of the Board of Governors
of the Federal Reserve System, 1913-96
APPOINTIVE
MEMBERS
Name
1
Federal Reserve
District
Charles S. Hamlin
....Boston
Paul M. Warburg
Frederic A. Delano
W.P.G. Harding
Adolph C. Miller
... .New York
....Chicago
....Atlanta
... .San Francisco
Date of initial
oath of office
Aug. 10, 1914
...Aug.
...Aug.
...Aug.
...Aug.
10,
10,
10,
10,
1914
1914
1914
1914
... .New York
Albert Strauss
Henry A. Moehlenpah
....Chicago
... .New York
Edmund Piatt
....Cleveland
David C. Wills
....Minneapolis
John R. Mitchell
....Chicago
Milo D. Campbell
....Cleveland
Daniel R. Crissinger
....St. Louis
George R. James
Edward H. Cunningham .. ....Chicago
....Minneapolis
Roy A. Young
... .New York
Eugene Meyer
... .Kansas City
Wayland W. Magee
....Atlanta
Eugene R. Black
....Chicago
M.S. Szymczak
... .Kansas City
J.J. Thomas
... .San Francisco
Marriner S. Eccles
...Oct. 26, 1918
...Nov. 10, 1919
...June 8, 1920
...Sept. 29, 1920
...May 12, 1921
...Mar. 14, 1923
...May 1, 1923
...May 14, 1923
...May 14, 1923
...Oct. 4, 1927
...Sept. 16, 1930
...May 18, 1931
...May 19, 1933
...June 14, 1933
...June 14, 1933
...Nov. 15, 1934
... .New York
Joseph A. Broderick
....Cleveland
John K. McKee
....Atlanta
Ronald Ransom
....Dallas
Ralph W. Morrison
....Richmond
Chester C. Davis
... .New York
Ernest G. Draper
....Richmond
Rudolph M. Evans
James K. Vardaman, Jr. .. ... .St. Louis
....Boston
Lawrence Clayton
....Philadelphia
Thomas B. McCabe
....Atlanta
Edward L. Norton
....Minneapolis
Oliver S. Powell
... .New York
Wm. McC. Martin, Jr
....SanFrancisco
A.L. Mills, Jr.
....Kansas City
J.L. Robertson
....Philadelphia
C. Canby Balderston
....Minneapolis
Paul E. Miller
....Dallas
Chas. N. Shepardson
....Atlanta
G.H. King, Jr
....Chicago
George W. Mitchell
....Richmond
J. Dewey Daane
... .San Francisco
Sherman J. Maisel
....Philadelphia
Andrew F. Brimmer
William W. Sherrill
....Dallas
... .New York
Arthur F. Burns
... .St. Louis
John E. Sheehan
....SanFrancisco
Jeffrey M. Bucher
... .Kansas City
Robert C. Holland
....Boston
Henry C. Wallich
....Dallas
Philip E. Coldwell
...Feb. 3, 1936
...Feb. 3, 1936
...Feb. 3, 1936
...Feb. 10, 1936
...June 25, 1936
...Mar. 30, 1938
...Mar. 14, 1942
...Apr. 4, 1946
...Feb. 14, 1947
...Apr. 15, 1948
...Sept. 1, 1950
...Sept. 1, 1950
...April 2, 1951
...Feb. 18, 1952
...Feb. 18, 1952
...Aug. 12, 1954
...Aug. 13, 1954
...Mar. 17, 1955
...Mar. 25, 1959
...Aug. 31, 1961
...Nov. 29, 1963
...Apr. 30, 1965
...Mar. 9, 1966
...May 1, 1967
...Jan. 31, 1970
...Jan. 4, 1972
...June 5, 1972
...June 11, 1973
...Mar. 8, 1974
...Oct. 29, 1974
Other dates and information relating
to membership 2
Reappointed in 1916 and 1926. Served until
Feb. 3, 1936.3
Term expired Aug. 9, 1918.
Resigned July 21, 1918.
Term expired Aug. 9, 1922.
Reappointed in 1924. Reappointed in 1934 from the
Richmond District. Served until Feb. 3, 1936.3
Resigned Mar. 15, 1920.
Term expired Aug. 9, 1920.
Reappointed in 1928. Resigned Sept. 14, 1930.
Term expired Mar. 4, 1921.
Resigned May 12, 1923.
Died Mar. 22, 1923.
Resigned Sept. 15, 1927.
Reappointed in 1931. Served until Feb. 3, 1936.4
Died Nov. 28, 1930.
Resigned Aug. 31, 1930.
Resigned May 10, 1933.
Term expired Jan. 24, 1933.
Resigned Aug. 15, 1934.
Reappointed in 1936 and 1948. Resigned May 31, 1961.
Served until Feb. 10, 1936.3
Reappointed in 1936, 1940, and 1944. Resigned
July 14, 1951.
Resigned Sept. 30, 1937.
Served until Apr. 4, 1946.3
Reappointed in 1942. Died Dec. 2, 1947.
Resigned July 9, 1936.
Reappointed in 1940. Resigned Apr. 15, 1941.
Served until Sept. 1, 1950.3
Served until Aug. 13, 1954.3
Resigned Nov. 30, 1958.
Died Dec. 4, 1949.
Resigned Mar. 31, 1951.
Resigned Jan. 31, 1952.
Resigned June 30, 1952.
Reappointed in 1956. Term expired Jan. 31, 1970.
Reappointed in 1958. Resigned Feb. 28, 1965.
Reappointed in 1964. Resigned Apr. 30, 1973.
Served through Feb. 28, 1966.
Died Oct. 21, 1954.
Retired Apr. 30, 1967.
Reappointed in 1960. Resigned Sept. 18, 1963.
Reappointed in 1962. Served until Feb. 13, 1976.3
Served until Mar. 8, 1974.3
Served through May 31, 1972.
Resigned Aug. 31, 1974.
Reappointed in 1968. Resigned Nov. 15, 1971.
Term began Feb. 1, 1970. Resigned Mar. 31, 1978.
Resigned June 1, 1975.
Resigned Jan. 2, 1976.
Resigned May 15, 1976.
Resigned Dec. 15, 1986.
Served through Feb. 29, 1980.
197
Federal Reserve
District
Name
Philip C. Jackson, Jr.
J. Charles Partee
Stephen S. Gardner ..
David M. Lilly
G. William Miller ...
Nancy H. Teeters
Emmett J. Rice
Frederick H. Schultz
Paul A. Volcker
Lyle E. Gramley
Preston Martin
Martha R. Seger
Wayne D. Angell
Manuel H. Johnson .
H. Robert Heller
Edward W. Kelley, Jr.
Alan Greenspan
John P. LaWare
David W. Mullins, Jr.
Lawrence B. Lindsey
Susan M. Phillips
Alan S. Blinder
Janet L. Yellen
Atlanta
Richmond
.Philadelphia
.Minneapolis
San Francisco
Chicago
New York
Atlanta
Philadelphia
Kansas City
San Francisco
Chicago
Kansas City
Richmond
San Francisco
Dallas
New York
Boston
St. Louis
Richmond
Chicago
Philadelphia
San Francisco
Chairmen 4
Charles S. Hamlin
W.P.G. Harding
Daniel R. Crissinger
Roy A. Young
Eugene Meyer
Eugene R. Black
Marriner S. Eccles
Thomas B. McCabe
Wm. McC. Martin, Jr
Arthur F. Burns
G. William Miller
Paul A. Volcker
Alan Greenspan
EX-OFFICIO
MEMBERS
Secretaries of the Treasury
W.G. McAdoo
Carter Glass
David F. Houston
Andrew W. Mellon
Ogden L. Mills
William H. Woodin
Henry Morgenthau Jr
Date of initial
oath of office
July 14, 1975
Jan. 5, 1976
Feb. 13, 1976
June 1, 1976
Mar. 8, 1978
Sept. 18, 1978
June 20, 1979
July 27, 1979
Aug. 6, 1979
May 28, 1980
Mar. 31, 1982
July 2, 1984
Feb. 7, 1986
Feb. 7, 1986
Aug. 19, 1986
May 26, 1987
Aug. 11, 1987
Aug. 15, 1988
May 21, 1990
Nov. 26, 1991
Dec. 2, 1991
June 27, 1994
Aug. 12, 1994
Aug. 10, 1914-Aug. 9, 1916
Aug. 10, 1916-Aug. 9, 1922
May 1, 1923-Sept. 15, 1927
Oct. 4, 1927-Aug. 31, 1930
Sept. 16, 1930-May 10, 1933
May 19, 1933-Aug. 15, 1934
Nov. 15, 1934-Jan. 31, 1948
Apr. 15, 1948-Mar. 31, 1951
Apr. 2, 1951-Jan. 31, 1970
Feb. 1, 1970-Jan. 31, 1978
Mar. 8, 1978-Aug. 6, 1979
Aug. 6, 1979-Aug. 11, 1987
Aug. 11,1987-
Resigned Nov. 17, 1978.
Served until Feb. 7, 1986.3
Died Nov. 19, 1978.
Resigned Feb. 24, 1978.
Resigned Aug. 6, 1979.
Served through June 27, 1984.
Resigned Dec. 31, 1986.
Served through Feb. 11, 1982.
Resigned August 11, 1987.
Resigned Sept. 1, 1985.
Resigned April 30, 1986.
Resigned March 11, 1991.
Served through Feb. 9, 1994.
Resigned August 3, 1990.
Resigned July 31, 1989.
Reappointed in 1990.
Reappointed in 1992.
Resigned April 30, 1995.
Resigned Feb. 14, 1994.
Term expired Jan. 31, 1996.
Vice Chairmen4
Frederic A. Delano
Paul M. Warburg
Albert Strauss
Edmund Piatt
J.J. Thomas
Ronald Ransom
C. Canby Balderston
J.L. Robertson
George W. Mitchell
Stephen S. Gardner
Frederick H. Schultz
Preston Martin
Manuel H. Johnson
David W. Mullins, Jr.
Alan S. Blinder
Aug. 10, 1914-Aug. 9, 1916
Aug. 10, 1916-Aug. 9, 1918
Oct. 26, 1918-Mar. 15, 1920
July 23, 1920-Sept. 14, 1930
Aug. 21, 1934-Feb. 10, 1936
Aug. 6, 1936-Dec. 2, 1947
Mar. 11, 1955-Feb. 28, 1966
Mar. 1, 1966-Apr. 30, 1973
May 1, 1973-Feb. 13, 1976
Feb. 13, 1976-Nov. 19, 1978
July 27, 1979-Feb. 11, 1982
Mar. 31, 1982-Apr. 30, 1986
Aug. 4, 1986-Aug. 3, 1990
July 24, 1991-Feb. 14, 1994
June 27, 1994-Jan. 31, 1996
1
Dec. 23, 1913-Dec. 15, 1918
Dec. 16, 1918-Feb. 1, 1920
Feb. 2, 1920-Mar. 3, 1921
Mar. 4, 1921-Feb. 12, 1932
Feb. 12, 1932-Mar. 4, 1933
Mar. 4, 1933-Dec. 31, 1933
Jan. 1, 1934-Feb. 1, 1936
1. Under the provisions of the original Federal Reserve Act, the Federal
Reserve Board was composed of seven members, including five appointive
members, the Secretary of the Treasury, who was ex-officio chairman of the
Board, and the Comptroller of the Currency. The original term of office was ten
years, and the five original appointive members had terms of two, four, six,
eight, and ten years respectively. In 1922 the number of appointive members
was increased to six, and in 1933 the term of office was increased to twelve
years. The Banking Act of 1935, approved Aug. 23, 1935, changed the name of
the Federal Reserve Board to the Board of Governors of the Federal Reserve
System and provided that the Board should be composed of seven appointive
members; that the Secretary of the Treasury and the Comptroller of the Cur-
Other dates and information relating
to membership 2
Comptrollers of the Currency
John Skelton Williams
Feb. 2, 1914-Mar. 2, 1921
Daniel R. Crissinger
Mar. 17, 1921-Apr. 30, 1923
Henry M. Dawes
May 1, 1923-Dec. 17, 1924
Joseph W. Mcintosh
Dec. 20, 1924-Nov. 20, 1928
J.W. Pole
Nov. 21, 1928-Sept. 20, 1932
J.F.T. O'Connor
May 11, 1933-Feb. 1, 1936
rency should continue to serve as members until Feb. 1, 1936; that the appointive members in office on the date of that act should continue to serve until
Feb. 1,1936, or until their successors were appointed and had qualified; and that
thereafter the terms of members should be fourteen years and that the designation of Chairman and Vice Chairman of the Board should be for a term of four
years.
2. Date after words "Resigned" and "Retired" denotes final day of service.
3. Successor took office on this date.
4. Chairman and Vice Chairman were designated Governor and Vice Governor before Aug. 23, 1935.
1
Financial and Business Statistics
A3
GUIDE
TO TABULAR
DOMESTIC
Federal Finance
PRESENTATION
FINANCIAL
STATISTICS
Money Stock and Bank Credit
A4
Reserves, money stock, liquid assets, and debt
measures
A5 Reserves of depository institutions, Reserve Bank
credit
A6 Reserves and borrowings—Depository
institutions
A7 Selected borrowings in immediately available
funds—Large member banks
A28
A29
A30
A30
Federal fiscal andfinancingoperations
U.S. budget receipts and outlays
Federal debt subject to statutory limitation
Gross public debt of U.S. Treasury—
Types and ownership
A31 U.S. government securities
dealers—Transactions
A32 U.S. government securities dealers—
Positions and financing
A3 3 Federal and federally sponsored credit
agencies—Debt outstanding
Securities Markets and Corporate Finance
Policy Instruments
A8 Federal Reserve Bank interest rates
A9 Reserve requirements of depository institutions
A10 Federal Reserve open market transactions
Federal Reserve Banks
A l l Condition and Federal Reserve note statements
A12 Maturity distribution of loan and security
holdings
Monetary and Credit Aggregates
A13 Aggregate reserves of depository institutions
and monetary base
A14 Money stock, liquid assets, and debt measures
A16 Deposit interest rates and amounts outstanding—
commercial and BIF-insured banks
A17 Bank debits and deposit turnover
A34 New security issues—Tax-exempt state and local
governments and corporations
A35 Open-end investment companies—Net sales
and assets
A35 Corporate profits and their distribution
A36 Domestic finance companies—Assets and
liabilities, and consumer, real estate, and business
credit
Real Estate
A37 Mortgage markets
A3 8 Mortgage debt outstanding
Consumer Installment Credit
A39 Total outstanding
A39 Terms
Flow of Funds
Commercial Banking Institutions
A18 Assets and liabilities, Wednesday figures
Weekly Reporting Commercial Banks—
Assets and liabilities
A21 Large reporting banks
A23 Branches and agencies of foreign banks
A40
A42
A43
A44
Funds raised in U.S. credit markets
Summary offinancialtransactions
Summary of credit market debt outstanding
Summary offinancialassets and liabilities
DOMESTIC
NONFINANCIAL
STATISTICS
Selected Measures
Financial Markets
A24 Commercial paper and bankers dollar
acceptances outstanding
A25 Prime rate charged by banks on short-term
business loans
A26 Interest rates—money and capital markets
A27 Stock market—Selected statistics
A45 Nonfinancial business activity—
Selected measures
A45 Labor force, employment, and unemployment
A46 Output, capacity, and capacity utilization
A47 Industrial production—Indexes and gross value
A49 Housing and construction
A50 Consumer and producer prices
2
Federal Reserve Bulletin • February 1996
DOMESTIC
NONFINANCIAL
STATISTICS-
CONTINUED
Selected
Measures—Continued
A51 Gross domestic product and income
A52 Personal income and saving
INTERNATIONAL
STATISTICS
Summary Statistics
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 Selected U.S. liabilities to foreign official
institutions
Reported by Nonbanking Business
Enterprises in the United States
A61 Liabilities to unaffiliated foreigners
A62 Claims on unaffiliated foreigners
Securities Holdings and Transactions
A63 Foreign transactions in securities
A64 Marketable U.S. Treasury bonds and
notes—Foreign transactions
Interest and Exchange Rates
A65 Discount rates of foreign central banks
A65 Foreign short-term interest rates
A66 Foreign exchange rates
A 6 7 GUIDE
Reported by Banks in the United States
A55
A56
A58
A59
Liabilities to and claims on foreigners
Liabilities to foreigners
Banks' own claims on foreigners
Banks' own and domestic customers' claims on
foreigners
A59 Banks' own claims on unaffiliated foreigners
A60 Claims on foreign countries—
Combined domestic offices and foreign branches
SPECIAL
TO STATISTICAL
RELEASES
AND
TABLES
A68 Terms of lending at commercial banks,
November 1995
A72 Assets and liabilities of U.S. branches and agencies of
foreign banks, September 30, 1995
A 7 6 INDEX TO STATISTICAL
TABLES
3
Guide to Tabular Presentation
SYMBOLS
c
e
n.a.
n.e.c.
p
r
*
0
ATS
BIF
CD
CMO
FFB
FHA
FHLBB
FHLMC
FmHA
FNMA
FSLIC
G-7
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
Bank insurance fund
Certificate of deposit
Collateralized mortgage obligation
Federal Financing Bank
Federal Housing Administration
Federal Home Loan Bank Board
Federal Home Loan Mortgage Corporation
Farmers Home Administration
Federal National Mortgage Association
Federal Savings and Loan Insurance Corporation
Group of Seven
G-10
GNMA
GDP
HUD
IMF
IO
IPCs
IRA
MMDA
MSA
NOW
OCD
OPEC
OTS
PO
REIT
REMIC
RP
RTC
SAIF
SCO
SDR
SIC
VA
Group of Ten
Government National Mortgage Association
Gross domestic product
Department of Housing and Urban
Development
International Monetary Fund
Interest only
Individuals, partnerships, and corporations
Individual retirement account
Money market deposit account
Metropolitan statistical area
Negotiable order of withdrawal
Other checkable deposit
Organization of Petroleum Exporting Countries
Office of Thrift Supervision
Principal only
Real estate investment trust
Real estate mortgage investment conduit
Repurchase agreement
Resolution Trust Corporation
Savings Association Insurance Fund
Securitized credit obligation
Special drawing right
Standard Industrial Classification
Department of Veterans Affairs
INFORMATION
In many of the tables, components do not sum to totals because of
rounding.
Minus signs are used to indicate (1) a decrease, (2) a negative
figure, or (3) an outflow.
"U.S. government securities" may include guaranteed issues
of U.S. government agencies (the flow of funds figures also
include not fully guaranteed issues) as well as direct obligations of the Treasury. "State and local government" also includes municipalities, special districts, and other political
subdivisions.
A4
1.10
DomesticNonfinancialStatistics • February 1996
RESERVES, 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
1994
1995
1995
Monetary or credit aggregate
Q4
5
6
7
8
9
Q3
July
-3.3
-3.0
-2.1
6.9
-3.7
-4.0
-2.4
6.4
-8.0
-7.0
-8.6
6.3
-1.2
-2.3
-2.2
1.0
6.3
3.8
4.3
-.3
-2.9
-.8
-1.1
3.3
-1.2
-.3
1.7
2.2
5.4r
.0
1.7
4.4
6.4
5.3r
-.9
4.4
7.1
7.6
7.0 r
-1.0
7.7
8.7 r
9.r
4.2r
1.0
6.2
8.4
1 l.6 r
2.4r
2.5
18.5
6.9
20.7 r
11.7
13.8r
-8.5
16.0
17.7
-13.2
24.3
12.7
-7.3
23.4
15.8
-17.6
10.9
14.1
-20.5
21.5
23.3
7.5
7.3
7.9
10.0
5.8 r
5.3 r
5.r
5.3 r
Aug.
Sept.
Oct.
Nov.
-3.1
-2.3
-3.0
I.I
- 1 l.4 r
-14.4
-10.8
3.3
-11.7
-8.9
-10.8
.7
-1.6
8.3
7.7
1.1'
3.5r
-3.9
4.4
4.0 r
8.0 r
3.7r
-10.4
-l.0r
3.r
4.2
3.6
-3.4
2.9
1.5
n.a.
n.a.
8.5
18.8
12.8
4.7 r
8.0
2.3 r
3.2 r
22.4 r
5.7
-5.5
10.3
9.8
14.3r
4.3
10.0
19.6
14.5
5.5
5.6
11.7
1.9
8.1r
11.2
1.5
40.3 r
12.1
4.2
17.4
-14.5
26.6
14.6
-5.8
3.7
13.4
-7.6
.3
30.5
-7.0
2.0
9.9
-.3
2.3
8.2
.0
2.7
17.9
-7.0
3.7
4.8
18.1
27.1
43.3
29.3
44.5
39.7
37.7
-9.0
17.6
15.4
9.9
12.9
12.6
-5.6
2.0 r
4. l r
,8r
4.7 r
2.9
3.9
institutions'
Concepts of money, liquid assets, and debt4
Ml
M2
M3
L
Debt
Nontransaction
10 In M2 5
11 In M3 only 6
Q2
.2
I2.4 r
Reserves of depositor/
1 Total
2 Required
3 Nonborrowed
4 Monetary base'1
Q1
components
Time and savings deposits
Commercial banks
Savings, including MMDAs
Small time 7
Large time 8 ' 9
Thrift institutions
Savings, including MMDAs
15
16 Small time 7
Large time 8
17
12
13
14
Money market mutual funds
18 General purpose and broker-dealer
19 Institution-only
4
Debt components
20
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. The seasonally adjusted, break-adjusted monetary base consists of (1) seasonally
adjusted, break-adjusted total reserves (line I), 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:
M l : (1) currency outside the U.S. Treasury, Federal Reserve Banks, and the vaults of
depository institutions, (2) travelers checks of nonbank issuers, (3) demand deposits at all
commercial banks other than those owed to depository institutions, the U.S. government, and
foreign banks and official institutions, less cash items in the process of collection and Federal
Reserve float, and (4) other checkable deposits (OCDs), consisting of negotiable order of
withdrawal (NOW) and automatic transfer service (ATS) accounts at depository institutions,
credit union share draft accounts, and demand deposits at thrift institutions. Seasonally
adjusted Ml is computed by summing currency, travelers checks, demand deposits, and
OCDs, each seasonally adjusted separately.
M2: Ml plus (I) 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-M 1
component as a whole and then adding this result to seasonally adjusted M1.
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
5.4 r
7.5 r
4.6 r
4.l r
4.3 r
1.8r
n.a.
n.a.
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: The debt aggregate is the outstanding credit market debt of the domestic nonfinancial
sectors—the federal sector (U.S. government, not including government-sponsored enterprises or federally related mortgage pools) and the nonfederal sectors (state and local
governments, households and nonprofit organizations, nonfinancial corporate and nonfarm
noncorporate businesses, and farms). Nonfederal debt consists of mortgages, tax-exempt and
corporate bonds, consumer credit, bank loans, commercial paper, and other loans. The data,
which are derived from the Federal Reserve Board's flow of funds accounts, are breakadjusted (that is, discontinuities in the data have been smoothed into the series) and
month-averaged (that is, the data have been derived by averaging adjacent month-end levels).
5. Sum of (I) overnight RPs and overnight Eurodollars, (2) money market fund balances
(general purpose and broker-dealer), (3) savings deposits (including MMDAs), and (4) small
time deposits.
6. Sum of (I) 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 institutiononly 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, the U.S. government, and foreign banks and official institutions.
Money Stock and Bank Credit
A5
RESERVES OF DEPOSITORY INSTITUTIONS A N D RESERVE BANK CREDIT 1
Millions of dollars
Average of
daily figures
Average of daily figures for week ending on date indicated
Sept.
Oct.
Nov.
Oct. 18
Oct. 2 5
Nov. 1
Nov. 8
Nov. 15
Nov. 2 2
Nov 2 9
410,892
410,695
413,165
411,856
410.282
409.125
409,709
412,622
414.222
416.408
370,395
1,839
371,499
1,426
375,660
371
373.897
4,423
373,735
6.377
SUPPLYING RESERVE FUNDS
1 Reserve Bank credit outstanding
9
in
n
U.S. government securities 2
Bought outright—System account
Held under repurchase agreements
Federal agency obligations
Bought outright
Held under repurchase agreements
Acceptances
Loans to depository institutions
Adjustment credit
Seasonal credit
Extended credit
Float
Other Federal Reserve assets
i?
13
14
Gold stock
Special drawing rights certificate account
Treasury currency outstanding
2
3
4
5
6
7
8
371,068
4,206
370,901
3,227
373,648
3,249
371,359
4,112
370,796
2,876
2,932
106
0
2,876
479
0
2,796
320
2,895
400
0
2,883
989
0
2,812
750
0
2,812
391
0
2,812
71
0
2.812
710
0
2,761
169
0
28
45
204
0
408
0
537
166
67
0
901
22
254
31,890
32,425
32,019
31 1
62
0
779
31,228
360
58
0
1.123
31,826
11,052
11,050
10,168
23,721
11,051
10,168
23,799
10,168
23,881
411,003
322
411,565
315
10,366
0
217
0
381
32,469
24
190
0
304
7
147
0
686
2
84
0
893
36
63
0
1,116
32,219
32,489
32,602
32,492
23,860
11,051
10,168
23,797
11,051
10,168
23,811
11,051
10,168
23,825
11,051
10,168
23,839
10,168
23,853
11.050
10.168
23,867
414,005
287
412,499
313
410,989
313
410,761
311
411,968
293
413,058
295
414,272
281
416,621
5,410
203
5,109
326
13,006
19,896
4,941
181
5,275
184
4,996
333
12,983
20,239
5,228
185
5,006
4,948
200
4,978
343
12,876
19,160
6,024
5,125
198
5,250
325
13,155
20,701
5,614
4,989
347
12.952
19,850
11,051
11,050
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
?o Other
?\ Other Federal Reserve liabilities and capital
22 Reserve balances with Federal Reserve Banks
6,850
179
4,688
348
...
12,176
20,466
5,384
179
4,874
386
12,938
20,07 l r
4,829
546
12,813
20,748
341
12,910
19,426
177
278
241
5,213
283
13.135
20.122
Wednesday figures
End-of-month figures
29
Sept.
Oct.
Nov.
Oct. 18
Oct. 25
Nov. I
Nov. 8
Nov. 15
Nov. 22
Nov.
410,266
409,828 r
412,866
409,976
414,760
411,341
414,368
413,040
416,500
415,422
367,669
6,445
371,227
2,290
373,819
6,983
370,980
4,112
370,173
7,780
372,070
2,290
371,575
5,431
374,930
2,600
373,887
5,104
374,228
5,475
2,895
75
0
2,812
2,692
2,692
500
1,061
0
0
0
2,812
987
0
2,812
975
2,812
210
2,812
0
0
2,895
400
2,812
210
0
0
0
0
2
106
2
68
2,164
58
0
370
31,043
52
0
948
31,725
SUPPLYING RESERVE FUNDS
1 Reserve Bank credit outstanding
U.S. government securities
Bought outright—System account
2
Held under repurchase agreements
3
Federal agency obligations
Bought outright
4
Held under repurchase agreements
5
Acceptances
6
Loans to depository institutions
Adjustment credit
7
8
Seasonal credit
9
Extended credit
10 Float
11
Other Federal Reserve assets
160
261
0
73
32,687
0
124
172
0
0
-345
33,069
0
0
1,463
32,387
298
33,193
3
63
0
1,286
30,846
23,797
11,051
10,168
23,811
11,051
10,168
23,825
11,051
10,168
23,839
11,050
10,168
23.853
11,050
10,168
23,867
11,050
10.168
23,881
416,682
276
412,491
313
411,416
314
412.050
292
413,437
298
414,261
416,373
278
417.527
276
5,703
194
5,240
5,710
162
4,829
349
12,562
18,574
5,336
269
4,996
326
12,723
24,409
4,627
191
5,006
409
12,659
21,15 0
5,032
168
4.978
345
12,716
22,453
6,505
195
5,250
280
12,936
19,767
6,439
167
5,213
278
12,866
17,755
-1,038
32,405
11,051
10,168
23,825
11,050
10,168
23,895
409,275
322
Gold stock
Special drawing rights certificate account
14 Treasury currency outstanding
833 r
32,332 r
411,767
314
8,620
201
4,766
332
13,088
18,650
7,018
0
302
8
213
5
50
0
-1,819
31,136
11,051
10,168
23,769
1?.
13
1
123
11,051
10,168
ABSORBING RESERVE FUNDS
IS Currency in circulation
16 Treasury cash holdings
Deposits, other than reserve balances, with
Federal Reserve Banks
Treasury
17
18 Foreign
Service-related balances and adjustments
IP
?0 Other
?] Other Federal Reserve liabilities and capital
22 Reserve balances with Federal Reserve Banks 3
..
275
5,006 r
375
13,073
I7,045 r
282
12,697
16,906
1. Amounts of cash held as reserves are shown in table 1.12, line 2.
2. Includes securities loaned—fully guaranteed by U.S. government securities pledged
with Federal Reserve Banks—and excludes securities sold and scheduled to be bought back
under matched sale-purchase transactions.
281
5,256
194
4,989
344
12,843
19,943
3. Excludes required clearing balances and adjustments to compensate for float.
A6
DomesticNonfinancialStatistics • February 1996
1.12
RESERVES AND BORROWINGS
Depository Institutions'
Millions of dollars
Prorated monthly averages of biweekly averages
1
2
3
4
5
6
7
8
9
10
Reserve balances with Reserve Banks2
Total vault cash3
Applied vault cash4
Surplus vault cash5
Total reserves6
Required reserves
Excess reserve balances at Reserve Banks7
Total borrowings at Reserve Banks8
Seasonal borrowings
Extended credit
1992
1993
1994
Dec.
Reserve classification
Dec.
Dec.
May
June
July
Aug.
Sept.
Oct.
Nov.
25,368
34,541
31,172
3,370
56.540
55,385
1,155
124
18
1
29,374
36,818
33,484
3,334
62,858
61,795
1,063
82
31
0
24,658
40,365
36,682
3,683
61,340
60,172
1,168
209
100
0
21,476
39,038
35,281
3,757
56,757
55,877
880
150
137
0
21,058
39,839
35,986
3,853
57,044
56,079
964
272
172
0
20,840
40,522
36,550
3,971
57,390
56,300
1,090
371
231
0
20,565
40,177
36,255
3,923
56,819
55,832
988
282
258
0
20,519
40,648
36,640
4,008
57,159
56,209
950
278
252
0
20,055r
40,561
36,345
4,216
56,400
55,319
1,081
245
199
0
20,066
40,575
36,332
4,244
56,397
55,455
942
204
73
0
1995
Biweekly averages of daily figures for two week periods ending on dates indicated
1995
Aug. 2
1
2
3
4
5
6
7
8
9
10
Reserve balances with Reserve Banks"
Total vault cash'
Applied vault cash4
Surplus vault cash5
Total reserves6
Required reserves
Excess reserve balances at Reserve Banks7
Total borrowings at Reserve Banks8
Seasonal borrowings
Extended credit9
Aug. 16
Aug. 30
Sept. 13
Sept. 27
Oct. 11
Oct. 25
Nov. 8 r
Nov. 22
Dec. 6
19,920
40,983
36,878
4,106
56,798
55,443
1,354
478
245
0
20,793
40,889
36,898
3,991
57,691
56,491
1,200
250
247
0
20,395
39,324
35,491
3,833
55,886
55,153
733
288
272
0
21,029
40,554
36,693
3,862
57,722
56,879
843
268
245
0
20,182
40,628
36,556
4,072
56,738
55,781
957
274
261
0
19,886
41,153
36,805
4,348
56,690
55,312
1,378
338
240
0
20,496
39,855
35,770
4,086
56,265
55,406
860
227
204
0
19,334
41,123
36,846
4,277
56,180
55,129
1,052
121
116
0
20,270
40,218
36,071
4,148
56,341
55,544
797
236
63
0
20,439
40,653
36,274
4,379
56,713
55,627
1,085
233
51
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. Data are not break-adjusted or seasonally adjusted.
2. Excludes required clearing balances and adjustments to compensate for float and
includes other off-balance-sheet "as-of" adjustments.
3. Total "lagged" vault cash held by depository institutions subject to reserve
requirements. Dates refer to the maintenance periods during which the vault cash may be used
to satisfy reserve requirements. The maintenance period for weekly reporters ends sixteen
days after the lagged computation period during which the vault cash is held. Before Nov. 25,
1992, the maintenance period ended thirty days after the lagged computation period.
4. All vault cash held during the lagged computation period by "bound" institutions (that
is, those whose required reserves exceed their vault cash) plus the amount of vault cash
applied during the maintenance period by "nonbound" institutions (that is, those whose vault
cash exceeds their required reserves) to satisfy current reserve requirements.
5. Total vault cash (line 2) less applied vault cash (line 3).
6. Reserve balances with Federal Reserve Banks (line 1) plus applied vault cash
(line 3).
7. Total reserves (line 5) less required reserves (line 6).
8. Also includes adjustment credit.
9. Consists of borrowing at the discount window under the terms and conditions established for the extended credit program to help depository institutions deal with sustained
liquidity pressures. Because there is not the same need to repay such borrowing promptly as
with traditional short-term adjustment credit, the money market effect of extended credit is
similar to that of nonborrowed reserves.
Money Stock and Bank Credit
1.13
SELECTED B O R R O W I N G S IN IMMEDIATELY AVAILABLE F U N D S
A7
Large Banks'
Millions of dollars, averages of daily figures
1995, week ending Monday
Source and maturity
Oct.
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
2'
Oct.
9'
Oct.
16
Oct.
23
Oct.
30
Nov.
6
Nov.
13
Nov.
20
Nov.
27
82,326
16,162
83,166
15,083
80,898
14,701
80,764
15,224
87,443
15,906
88,385
15,801
87,566
16,272
85,916
15,698
83,770
16,092
22,796
23,272
20,172
23,104
23,263
23,054
21,530
22,142
18,531
22,598
20,008
22,303
20,246
22,979
20,475
21,854
21,528
22,400
21,188
29,949
18,310
33,907
20,503
34,083
17,911
36,211
17,892
36,216
17,442
31,849
17,047
34,156
17,922
28,791
17,546
28,864
41,493
18,040
39,005
18,266
40,657
17,335
40,997
17,254
42,351
16,833
42,910
16,488
40,802
18,640
43,971
16,976
41,183
21,046
60,978
26,021
54,156
29,272
55,932
28,075
59,787
28,031
61,281
27,924
60,195
30,663
59,269
31,801
56,296
31,080
57,722
29,735
MEMO
9
10
Federal funds loans and resale agreements in immediately
available funds in maturities of one day or under
continuing contract
To commercial banks in the United States
To all other specified customers2
1. Banks with assets of $4 billion or more as of Dec. 31, 1988.
Data in this table also appear in the Board's H.5 (507) weekly statistical release. For
ordering address, see inside front cover.
2. Brokers and nonbank dealers in securities, other depository institutions, foreign banks
and official institutions, and U.S. government agencies,
A8
DomesticNonfinancialStatistics • February 1996
1.14
FEDERAL RESERVE BANK INTEREST RATES
Percent per year
Current and previous levels
Adjustment credit1
Federal Reserve
Bank
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
On
1/5/96
Extended credit3
Effective date
Previous rate
On
1/5/96
Effective date
Previous rate
On
1/5/96
Effective date
Previous rate
2/1/95
2/1/95
2/2/95
2/9/95
2/1/95
2/2/95
4.75
5.45
1/4/96
5.75
5.95
1/4/96
6.25
4.75
5.45
1/4/96
5.75
5.95
1/4/96
6.25
5.25
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
Seasonal credit2
2/1/95
2/1/95
2/2/95
2/1/95
2/2/95
2/1/95
5.25
Range of rates for adjustment credit in recent years4
Effective date
In effect Dec. 31, 1977
1978—Jan.
Range (or
level)—All
F.R. Banks
6
9
20
11
12
3
10
21
22
16
20
1
3
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
July 28
29
Sept. 26
Nov. 17
Dec. 5
8
1981—May 5
8
12-13
13
12-13
12
11-12
11
10-11
10
11
12
12-13
13
13-14
14
May
July
Aug.
Sept.
Oct.
Nov.
F.R. Bank
of
N.Y.
6
6.5
6.5
7
7
7.25
7.25
7.75
8
8.5
8.5
9.5
9.5
10
10.5
10.5
11
11
12
12
13
13
13
12
11
11
10
10
11
12
13
13
14
14
Effectiv
1981—Nov. 2
Dec. 4
1982—July 20
23
Aug. 2
3
16
27
30
Oct. 12
13
Nov. 22
26
Dec. 14
15
17
F.R. Bank
of
N.Y.
13-14
13
12
13
13
12
11.5-12
11.5
11-11.5
11
10.5
10-10.5
10
9.5-10
9.5
9-9.5
9
8.5-9
8.5-9
8.5
11.5
11.5
11
11
10.5
10
10
9.5
9.5
9
9
9
8.5
8.5
9
13
Nov. 21
26
Dec. 24
8.5-9
9
8.5-9
8.5
8
9
9
8.5
8.5
8
1985—May 20
24
7.5-8
7.5
7.5
7.5
1986—Mar. 7
10
Apr. 21
23.
July 11
Aug. 21
22
7-7.5
7
6.5-7
6.5
6
5.5-6
5.5
7
7
6.5
6.5
6
5.5
5.5
1984—Apr.
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 charged by 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 ordinarily is
charged on extended-credit loans outstanding less than thirty days; however, at the discretion
Range (or
level)—All
F.R. Banks
Effective date
Range (or
level)—All
F.R. Banks
F.R. Bank
of
N.Y.
1987—Sept. 4
11
5.5-6
6
6
6
1988—Aug. 9
11
6-6.5
6.5
6.5
6.5
1989—Feb. 24
27
6.5-7
7
7
7
1990—Dec. 19
6.5
6.5
1
4
30
2
13
17
6
7
20
24
6-6.5
6
5.5-6
5.5
5-5.5
5
4.5-5
4.5
3.5^.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
1994—May 17
18
Aug. 16
18
Nov. 15
17
3-3.5
3.5
3.5-4
4
4^.75
4.75
3.5
3.5
4
4
4.75
4.75
4.75-5.25
5.25
5.25
5.25
5.25
5.25
1991—Feb.
Apr.
May
Sept.
Nov.
Dec.
1992—July
1995—Feb.
1
9
In effect Jan. 5, 1996
of the Federal Reserve Bank, this time period may be shortened. Beyond this initial period, a
flexible rate somewhat above rates charged 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, 19701979.
In 1980 and 1981, the Federal Reserve applied a surcharge to short-term adjustment-credit
borrowings by institutions with deposits of $500 million or more that had borrowed in
successive weeks or in more than four weeks in a calendar quarter. A 3 percent surcharge was
in effect from Mar. 17, 1980, through May 7, 1980. A surcharge of 2 percent was reimposed
on Nov. 17, 1980; the surcharge was subsequently raised to 3 percent on Dec. 5, 1980, and to
4 percent on May 5, 1981. The surcharge was reduced to 3 percent effective Sept. 22, 1981,
and to 2 percent effective Oct. 12, 1981. As of Oct. 1, 1981, the formula for applying the
surcharge was changed from a calendar quarter to a moving thirteen-week period. The
surcharge was eliminated on Nov. 17, 1981.
Policy Instruments
1.15
A9
RESERVE REQUIREMENTS OF DEPOSITORY INSTITUTIONS 1
Requirement
Type of deposit
Percentage of
deposits
1
2
Net transaction accounts3
$0 million-$52.0 million 3
More than $52.0 million 4
Effective date
3
10
12/19/95
12/19/95
0
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 the Monetary Control Act of 1980, depository institutions
include commercial banks, mutual savings banks, savings and loan associations, credit
unions, agencies and branches of foreign banks, and Edge Act corporations.
2. Transaction accounts 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 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 savings deposits, not
transaction accounts.
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 of each year. Effective Dec. 19, 1995, the amount was decreased from $54.0 million
to $52.0 million.
3. Under the Garn-St Germain Depository Institutions Act of 1982, the Board adjusts the
amount of reservable liabilities subject to a zero percent reserve requirement each year for the
12/27/90
0
12/27/90
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 made in the event of a decrease. Effective Dec. 19, 1995, the
exemption was raised from $4.2 million to $4.3 million. The exemption applies only to
accounts that would be subject to a 3 percent reserve requirement.
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 1 years was reduced from 3 percent to I [/2 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 I 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 I years was reduced from 3 percent to zero on Jan. 17,
1991.
6. The reserve requirement on Eurocurrency liabilities was reduced from 3 percent to zero
in the same manner and on the same dates as was the reserve requirement on nonpersonal
time deposits with an original maturity of less than 1 '/> years (see note 5).
A10
DomesticNonfinancialStatistics • February 1996
1.17 FEDERAL RESERVE OPEN MARKET TRANSACTIONS'
Millions of dollars
1995
Type of transaction
and maturity
1992
1993
1994
Apr.
May
June
July
Aug.
Sept.
Oct.
U.S. TREASURY SECURITIES
Outright transactions (excluding matched
transactions)
Treasury bills
1
Gross purchases
2
Gross sales
3
Exchanges
4
Redemptions
Others within one year
Gross purchases
5
Gross sales
6
7
Maturity shifts
8
Exchanges
y
Redemptions
One to five years
Gross purchases
10
Gross sales
11
12
Maturity shifts
Exchanges
13
Five to ten years
Gross purchases
14
15
Gross sales
Maturity shifts
16
17
Exchanges
More than ten years
Gross purchases
18
Gross sales
19
20
Maturity shifts
Exchanges
21
All maturities
Gross purchases
22
Gross sales
23
24
Redemptions
25
26
Matched transactions
Gross purchases
Gross sales
27
28
Repurchase agreements
Gross purchases
Gross sales
29
Net change in U.S. Treasury securities
14,714
1,628
308,699
1,600
17,717
0
332,229
0
17,484
0
376,277
0
0
0
30,983
0
0
0
31,663
0
4,470
0
42,983
0
0
0
25,213
0
433
0
39,195
0
409
0
30,333
0
1,350
0
29,397
900
1,096
0
36,662
-30,543
0
1,223
0
31,368
-36,582
0
1,238
0
0
-21,444
0
0
0
2,993
0
0
0
0
7,174
-7,374
0
0
0
2,177
-1,392
0
0
0
2,063
-562
0
0
0
7,805
-5,599
0
0
0
0
0
0
0
0
1,745
-2,049
0
13,118
0
-34,478
25,811
10,350
0
-27,140
0
9,168
0
—6,004
17,801
2,549
0
-477
0
0
0
-6,694
5,374
0
0
-2,177
1,392
0
0
-2,063
562
0
0
-3,379
4,805
100
0
0
0
0
0
-1,745
2,049
2,818
0
-1,915
3,532
4,168
0
0
0
3,818
0
-3,145
2,903
839
0
-2,516
0
0
0
1,248
2,000
0
0
0
0
0
0
0
0
0
0
-319
1,800
0
0
0
0
0
0
0
0
2,333
0
-269
1,200
3,457
0
0
0
3,606
0
-918
775
1,138
0
0
0
0
0
-1,728
0
0
0
0
0
0
0
0
0
0
0
-525
1,100
100
0
0
0
0
0
0
0
34,079
1,628
1,600
36,915
0
767
35,314
0
2.337
4,526
0
370
0
0
0
4,470
0
0
0
0
0
433
0
0
609
0
0
1,350
0
1,385
1,480,140
1,482,467
1,475,941
1,475,085
1,700,836
1,701,309
148,306
147,616
155,027
153,534
170,083
171,959
166,674
163,490
179,130
185,270
195,830
198,587
216,755
213,161
378,374
386,257
475,447
470,723
309,276
311,898
36,314
39,157
35,158
34,377
40,989
28,196
8,527
24,851
4,130
1,075
43,286
39,896
28,825
32,980
20,642
41,729
29,882
2,004
2,274
15,387
-13,141
-2,651
1,241
-597
0
0
632
0
0
774
0
0
1,002
0
0
20
0
0
30
0
0
262
0
0
333
0
0
122
0
0
46
0
0
83
14,565
14,486
35,063
34,669
52.696
52,696
4,415
5,020
6,155
5,955
1,941
2,180
711
1,172
1,610
1,510
1,434
1,459
3,740
3,605
-554
-380
-1,002
-625
20,089
41,348
28,880
1,379
FEDERAL AGENCY OBLIGATIONS
30
31
32
Outright transactions
Gross purchases
Gross sales
Redemptions
33
34
Repurchase agreements
Gross purchases
Gross sales
35
Net change in federal agency obligations
36
Total net change in System Open Market Account.. .
1. Sales, redemptions, and negative figures reduce holdings of the System Open Market
Account; all other figures increase such holdings.
170
2,444
-501
14,886
-794
-13,935
-22
-2,673
-71
1,170
52
-545
Federal Reserve Banks
1.18
FEDERAL R E S E R V E B A N K S
A11
Condition and Federal Reserve Note Statements'
Millions of dollars
Wednesday
1995
Account
Nov. 1
Nov. 8
End of month
1995
Nov. 15
Nov. 22
Nov. 29
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
1 Bought outright
8 Held under repurchase agreements
11,051
10,168
458
11,051
10,168
464
11,050
10,168
458
11,050
10,168
458
11,050
10,168
432
11,051
10,168
435
11,051
10,168
460
11,050
10,168
442
109
0
0
71
0
0
66
0
0
2,222
0
0
354
0
0
421
0
0
124
0
0
55
0
0
2,812
210
2,812
987
2,812
500
2,812
1,061
2,692
0
2,895
75
2,812
210
2,692
0
374,360
377,006
377,530
378,991
379,703
374,114
373,517
380,802
10 Bought outright2
11
Bills
12
Notes
13
Bonds
14 Held under repurchase agreements
372,070
181,979
147,418
42,673
2,290
371,575
181,085
147,818
42,673
5,431
374,930
188,624
143,697
42,610
2,600
373,887
187,581
143,697
42,610
5,104
374,228
183,737
147,881
42,610
5,475
367,669
177,093
147,904
42,673
6,445
371,227
181,136
147,418
42,673
2,290
373,819
183,328
147,881
42,610
6,983
15 Total loans and securities
377,491
380,876
380,907
385,086
382,749
377,505
376,663
383,549
7,007
1,139
6,307
1,145
6,870
1,146
6,294
1,147
5,712
1,146
3,978
1,114
8,015
1,139
4,319
1,146
21,378
9,865
21,388
10,648
21,399
8,233
21,412
8,500
21,424
9,085
21,653
9,814
21,376
9,876
21,049
8,860
438,557
442,047
440,231
444,116
441,766
435,717
438,748
440,582
388,975
390,359
391,147
393,243
394,354
386,263
388,715
393,505
22 Total deposits
31,254
33,571
31,000
32,560
29,855
32,585
29,911
30,549
23
24
25
26
26,027
4,627
191
409
28,027
5,032
168
345
25,206
5,256
194
344
25,580
6,505
195
280
22,972
6,439
167
278
23,432
8,620
201
332
22,284
7,018
275
375
24,369
5,703
194
282
5,668
4,412
5,401
4,402
5,241
4,544
5,377
4,576
4,690
4,516
3,781
4,617
7,049
4,432
3,832
4,645
430,309
433,733
431,932
435,756
433,416
427,247
430,107
432,531
3,935
3,683
629
3,942
3,683
689
3,946
3,683
670
3,953
3,683
723
3,958
3,683
709
3,915
3,624
931
3,923
3,683
1,034
3,958
3,671
422
438,557
442,047
440,231
444,116
441,766
435,717
438,748
440,582
483,834
486,656
494,848
494,229
496,481
484,601
488,911
506,035
9 Total U.S. Treasury securities
16 Items in process of collection
17 Bank premises
Other assets
18 Denominated in foreign currencies3
19 All other4
20 Total assets
LIABILITIES
21 Federal Reserve notes
Depository institutions
U.S. Treasury—General account
Foreign—Official accounts
Other
27 Deferred credit items
28 Other liabilities and accrued dividends5
29 Total liabilities
CAPITAL A C C O U N T S
30 Capital paid in
31 Surplus
32 Other capital accounts
33 Total liabilities and capital accounts
MEMO
34 Marketable U.S. Treasury securities held in custody for
foreign and international accounts
Federal Reserve note statement
35 Federal Reserve notes outstanding (issued to Banks)
36
LESS: Held by Federal Reserve Banks
37
Federal Reserve notes, net
38
39
40
41
Collateral held against notes, net
Gold certificate account
Special drawing rights certificate account
Other eligible assets
U.S. Treasury and agency securities
42 Total collateral
482,163
93,187
388,975
481,618
91,258
390,359
480,391
89,244
391,147
479,322
86,079
393,243
478,321
83,966
394,354
472,874
86,611
386,263
482,369
93,654
388,715
477,946
84,441
393,505
11,051
10,168
0
367,756
11,051
10,168
0
369,141
11,050
10,168
0
369,929
11,050
10,168
0
372,025
11,050
10,168
0
373,136
11,051
10,168
0
365,044
11,051
10,168
0
367,496
11,050
10,168
0
372,286
388,975
390,359
391,147
393,243
394,354
386,263
388,715
393,505
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
DomesticNonfinancialStatistics • February 1996
FEDERAL RESERVE BANKS
Maturity Distribution of Loan and Security Holding
M i l l i o n s o f dollars
Wednesday
1995
Type of holding and maturity
Nov. 1
1 Total loans
2 Within fifteen days'
3 Sixteen days to ninety days
4 Total U.S. Treasury securities
5
6
7
8
9
10
Within fifteen days'
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 Total federal agency obligations
12
13
14
15
16
17
Within fifteen days'
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
1995
Nov. 8
Nov. 15
Nov. 22
Nov. 29
Sept. 30
Oct. 31
109
71
66
2,222
354
421
124
55
28
81
16
54
50
15
2,216
6
348
6
273
149
48
76
29
26
374,360
377,006
377,530
378,991
379,703
367,669
371,227
373,819
22,542
79,712
121,873
84,610
29,992
35,630
17,959
88,092
120,323
85,010
29,992
35,629
23,316
86,256
122,959
80,193
29,176
35,630
19,780
92,056
122,155
80,193
29,176
35,630
20,151
87,792
122,576
82,678
30,876
35,630
2,645
92,851
120,681
85,870
29,992
35,630
11,078
88,044
121,873
84,610
29,992
35,630
5,924
87,792
130,641
82,956
30,876
35,630
3,022
3,799
3,312
3,873
2,692
2,895
2,812
2,692
310
680
662
918
427
25
1,087
821
521
918
427
25
620
701
521
918
527
25
1,498
384
521
918
527
25
372
384
531
853
527
25
185
747
431
918
427
25
224
680
538
853
427
25
372
384
531
853
527
25
1. Holdings under repurchase agreements are classified as maturing within fifteen days in
accordance with maximum maturity of the agreements.
End of month
Nov. 30
NOTE. Total acceptances data have been deleted from this table because data are no longer
available.
Monetary and Credit Aggregates
1.20
A13
AGGREGATE RESERVES OF DEPOSITORY INSTITUTIONS A N D MONETARY BASE 1
Billions of dollars, averages of daily figures
1995
1991
Dec.
1992
Dec.
1993
Dec.
1994
Dec.
Apr.
Total reserves3
Nonborrowed reserves4
Nonborrowed reserves plus extended credit5
Required reserves
Monetary base6
June
July
Aug.
Sept.
Oct.
Nov.
57.66
57.28
57.28
56.57
429.66
57.52
57.23
57.23
56.53
430.86
57.37
57.09
57.09
56.42
431.25
56.82
56.58
56.58
55.74
432.42r
56.27
56.07
56.07
55.33
432.67
Seasonally adjusted
ADJUSTED FOR
C H A N G E S IN RESERVE REQUIREMENTS-
1
2
3
4
5
May
45.54
45.34
45.34
44.56
317.43
54.35
54.23
54.23
53.20
351.12
60.50
60.42
60.42
59.44
386.60
59.34
59.13
59.13
58.17
418.22
57.96
57.85
57.85
57.20
428.13
57.76
57.61
57.61
56.88
430.69
57.35
57.08
57.08
56.39
429.76
Not seasonally adjusted
6
7
8
9
10
Total reserves7
Nonborrowed reserves
Nonborrowed reserves plus extended credit5
Required reserves8
Monetary base9
46.98
46.78
46.78
46.00
321.07
56.06
55.93
55.93
54.90
354.55
62.37
62.29
62.29
61.31
390.59
61.13
60.92
60.92
59.96
422.51
58.93
58.82
58.82
58.18
428.74
56.82
56.68
56.68
55.95
429.29
57.13
56.85
56.85
56.16
430.26
57.49
57.12
57.12
56.40
431.30
56.93
56.65
56.65
55.95
431.08
57.29
57.01
57.01
56.34
431.62
56.54
56.30
56.30
55.46
431.57
56.56
56.35
56.35
55.62
433.18
55.53
55.34
55.34
54.55
333.61
.98
.19
56.54
56.42
56.42
55.39
360.90
1.16
.12
62.86
62.78
62.78
61.80
397.62
1.06
.08
61.34
61.13
61.13
60.17
427.25
1.17
58.87
58.76
58.76
58.12
432.79
.75
.11
56.76
56.61
56.61
55.88
433.47
.88
.15
57.04
56.77
56.77
56.08
434.57
.96
.27
57.39
57.02
57.02
56.30
435.56
1.09
.37
56.82
56.54
56.54
55.83
435.59
.99
.28
57.16
56.88
56.88
56.21
436.20
.95
.28
56.40
56.15
56.15
55.32
436.32r
1.08
.25
56.40
56.19
56.19
55.46
438.16
.94
.20
N O T ADJUSTED FOR
C H A N G E S IN RESERVE R E Q U I R E M E N T S ' "
11
12
13
14
15
16
17
Total reserves11
Nonborrowed reserves
Nonborrowed reserves plus extended credit5
Required reserves
Monetary base 12
Excess reserves1'1
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 starting in 1959 and estimates of the effect on required
reserves of changes in reserve requirements are available from the Money 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, breakadjusted required reserves (line 4) plus excess reserves (line 16).
4. Seasonally adjusted, break-adjusted nonborrowed reserves equal seasonally adjusted,
break-adjusted total reserves (line 1) less total borrowings of depository institutions from the
Federal Reserve (line 17).
5. Extended credit consists of borrowing at the discount window under the terms and
conditions established for the extended credit program to help depository institutions deal
with sustained liquidity pressures. Because there is not the same need to repay such
borrowing promptly as with traditional short-term adjustment credit, the money market effect
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 I), 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).
.21
8. To adjust required reserves for discontinuities that are due to regulatory changes in
reserve requirements, a multiplicative procedure is used to estimate what required reserves
would have been in past periods had current reserve requirements been in effect. Breakadjusted 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 (I) break-adjusted total reserves (line 6), plus
(2) the (unadjusted) currency component of the money stock, plus (3) (for all quarterly
reporters on the "Report of Transaction Accounts, Other Deposits and Vault Cash" and for all
those weekly reporters whose vault cash exceeds their required reserves) the break-adjusted
difference between current vault cash and the amount applied to satisfy current reserve
requirements.
10. Reflects actual reserve requirements, including those on nondeposit liabilities, with no
adjustments to eliminate the effects of discontinuities associated with regulatory 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 (I) 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 contemporaneous reserve requirements in February
1984, 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 1996
MONEY STOCK, LIQUID ASSETS, A N D D E B T MEASURES 1
Billions of dollars, averages of daily figures
1995
Item
1991
Dec.
1992
Dec.
1993
Dec.
1994
Dec.
Aug.
Sept.
Oct.
Nov.
Seasonally adjusted
1
2
3
4
S
Measures2
Ml
M2
M3
L
Debt
6
7
8
9
Ml components
Currency' 1
Travelers checks 4
Demand deposits 5
Other checkable deposits 6
897.3
3,457.9
4,176.0
4,989.8
1 l,335.6 r
1,024.4
3,515.3
4,182.9
5,059.3
11,878. r
1,128.6
3,583.6
4,242.3
5,145.7
12,514.2 r
1,148.0
3,616.9
4,303.9 r
5,269.7 r
13,150.8 r
1,143.4
3,743.5
4,519.2 r
5,559.5 r
I3,642.8 r
1,139.7
3,757.3
4,534.4 r
5,596.6 r
13,684.4 r
1,129.8
3,754.3'
4,546.1'
5,616.2
13,725.6
1,126.6
3,763.5
4,551.6
n.a.
n.a.
267.4
7.7
289.5
332.7
292.8
8.1
338.9
384.6
322.1
7.9
383.9
414.7
354.5
8.4
382.2
402.9
368.3
8.9
390.0
376.2
369.1
8.8
389.7
372.0
370.5
8.8'
387.2
363.4
371.0
8.8
387.0
359.7
2,560.6
718.1
2,490.9
667.6
2,455.0
658.7
2,468.9
687.0 r
2,600.2
115.1'
2,617.6
1112'
2,624.5'
791.7'
2,636.9
788.1
Commercial banks
12 Savings deposits, including M M D A s
13 Small time deposits 9
14 Large time deposits 10 ' "
665.6
602.5
333.3
754.7
508.1
286.7
785.8
468.6
271.2
752.3
502.6
296.6
739.5
569.7
325.2
746.7
570.6
327.4'
753.7
571.3
338.4'
761.3
573.3
343.3
Thrift institutions
15 Savings deposits, including MMDAs
16 Small time deposits 9
17 Large time deposits'"
375.6
464.1
83.3
428.9
361.1
67.1
429.8
316.5
61.6
391.9
318.3
64.9
358.6
358.0
73.2
358.5
358.7
73.7
358.5
359.5
74.8
356.4
360.6
75.1
Money market mutual funds
18 General purpose and broker-dealer
19 Institution-only
374.2
180.0
356.9
200.2
360.1
198.1
389.0
180.8
455.9
210.8
462.6
213.5
466.4
215.8
471.3
214.8
2,763.8'
8,57l.9 r
3,068.6 r
8,809.5 r
3,497.6 r
9,653. I r
3,62l.4 r
10,021,4 r
Nontransaction
10 In M2 7
11 In M3 only 8
components
Debt components
20 Federal debt
21 Nonfederal debt
3,328.3 r
9,l85.9 r
3,623.8 r
10,060.6'
3,632.6
10,093.0
n.a.
n.a.
1,135.7
3,747.1
4,521.9 r
5,575.4 r
13,637.3'
1,129.4
3,751.4'
4,541.4'
5,606.1
13,684.4
1,134.9
3,772.5
4,568.0
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 3
Travelers checks 4
Demand deposits 5
Other checkable deposits 6
916.0
3,472.7
4,189.4
5,014.2
1 l,333.5 r
1,046.0
3,533.6
4,201.4
5,088.9
1 l,879.6 r
1,153.7
3,606.1
4,266.1
5,180.2
12,507. I r
1,173.7
3,640.5
4,330.0 r
5,307.3 r
13,143.4 r
1,137.0
3,736.6
4,512.9 r
5,548.5 r
13,579. I r
269.9
7.4
302.4
336.3
295.0
7.8
354.4
388.9
324.8
7.6
401.8
419.4
357.6
8.1
400.3
407.6
369.0
9.5
386.5
372.0
369.2
9.3
388.1
369.1
369.9
8.9
390.7
359.8
371.6
8.7
395.6
359.1
2,556.6
716.7
2,487.7
667.7
2,452.5
660.0
2,466.8
689.5 r
2,599.6
776.4 r
2,611.4
774.8'
2,622.0'
790.0'
2,637.5
795.6
Commercial banks
33 Savings deposits, including MMDAs
34 Small time deposits 9
35 Large time deposits' 0 , "
664.0
601.9
332.6
752.9
507.8
286.2
784.3
468.2
270.8
751.1
502.2
296.3
740.8
570.3
326.6
746.8
571.1
328.6'
753.9
571.9
339.2'
763.6
573.0
345.1
Thrift institutions
36 Savings deposits, including MMDAs
37 Small time deposits 9
38 Large time deposits'"
374.8
463.7
83.1
427.9
360.9
67.0
429.0
316.2
61.5
391.2
318.1
64.8
359.3
358.3
73.6
358.6
359.0
74.0
358.6
359.9
75.0
357.5
360.3
75.5
Money market mutual funds
39 General purpose and broker-dealer
40 Institution-only
372.2
180.8
355.1
201.7
358.3
200.0
387.1
183.1
452.6
209.3
454.9
209.0
459.1
212.9
467.0
217.4
Repurchase agreements and
41 Overnight and continuing
42
79.9
132.7
83.2
127.8
96.5
143.9
117.2
157.8 r
118.2
I80.0 r
120.9
176.4'
118.6'
175.3'
116.1
169.7
2,765.0
8,568.5 r
3,069.8
8,809.8 r
3,329.5
9,l77.7 r
3,499.0
9,644.4 r
3,602.2
9,976.9 r
3,606.8
10,030.5'
3,610.1
10,074.3
Nontransaction
31 In M2 7
32 In M3 only"
components
Eurodollars
Debt components
43 Federal debt
44 Nonfederal debt
Footnotes appear on following page.
n.a.
n.a.
Monetary and Credit Aggregates
A15
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 starting in 1959 are available from the Money and Reserves
Projections Section, Division of Monetary Affairs, Board of Governors of the Federal Reserve
System, Washington, DC 20551.
2. Composition of the money stock measures and debt is as follows:
Ml: (1) currency outside the U.S. Treasury, Federal Reserve Banks, and the vaults of
depository institutions, (2) travelers checks of nonbank issuers, (3) demand deposits at all
commercial banks other than those owed to depository institutions, the US. 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-M 1
component as a whole and then adding this result to seasonally adjusted M1.
M3: M2 plus (I) 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: The debt aggregate is the outstanding credit market debt of the domestic nonfinancial
sectors—the federal sector (U.S. government, not including government-sponsored enterprises or federally related mortgage pools) and the nonfederal sectors (state and local
governments, households and nonprofit organizations, nonfinancial corporate and nonfarm
noncorporate businesses, and farms). Nonfederal debt consists of mortgages, tax-exempt and
corporate bonds, consumer credit, bank loans, commercial paper, and other loans. The data,
which are derived from the Federal Reserve Board's flow of funds accounts, are breakadjusted (that is, discontinuities in the data have been smoothed into the series) and
month-averaged (that is, the data have been derived by averaging adjacent month-end levels).
3. Currency outside the U.S. Treasury, Federal Reserve Banks, and vaults of depository
institutions.
4. Outstanding amount of U.S. dollar-denominated travelers checks of nonbank issuers.
Travelers checks issued by depository institutions are included in demand deposits.
5. Demand deposits at commercial banks and foreign-related institutions other than those
owed to depository institutions, the U.S. government, and foreign banks and official institutions, less cash items in the process of collection and Federal Reserve float.
6. Consists of NOW and ATS account balances at all depository institutions, credit union
share draft account balances, and demand deposits at thrift institutions.
7. Sum of (I) overnight RPs and overnight Eurodollars, (2) money market fund balances
(general purpose and broker-dealer), (3) savings deposits (including MMDAs), and (4) small
time deposits.
8. Sum of (1) large time deposits, (2) term RPs, (3) term Eurodollars of U.S. residents,
and (4) money market fund balances (institution-only), less (5) a consolidation adjustment
that represents the estimated amount of overnight RPs and Eurodollars held by institutiononly 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, the U.S. government, and foreign banks and official institutions.
A16
1.22
DomesticNonfinancialStatistics • February 1996
DEPOSIT INTEREST RATES AND AMOUNTS OUTSTANDING
Commercial and BIF-insured saving banks'
1995
1993
1994
Dec.
Dec/
Mar.
Apr.
May
June
July
Aug.
Sept.
Oct. r
Nov.
Interest rates (annual effective yields) 2
INSURED COMMERCIAL BANKS
1
2
3
4
5
6
7
Negotiable order of withdrawal accounts
Savings deposits 3
1.86
2.46
1.96
2.92
2.00
3.14
1.95
3.17
1.96
3.20
1.94
3.19
1.91
3.15
1.93
3.12
1.94
3.14
1.93
3.11
1.95
3.14
Interest-bearing time deposits with balances of
less than $100,000, by maturity
7 to 91 days
92 to 182 days
183 days to 1 year
More than 1 year to 2 years
More than 2 VI years
2.65
2.91
3.13
3.55
4.28
3.79
4.44
5.12
5.74
6.30
4.24
4.97
5.60
6.12
6.45
4.28
4.94
5.60
6.05
6.37
4.25
6.11
4.19
4.81
5.27
5.53
5.79
4.17
4.77
5.18
5.38
5.62
4.10
4.77
5.15
5.39
5.63
4.10
4.75
5.14
5.32
5.60
4.11
4.75
5.15
5.31
5.56
4.12
4.74
5.11
5.27
5.49
1.87
2.63
1.94
2.87
1.99
2.94
1.99
2.93
2.00
2.95
1.98
2.97
1.96
2.97
1.98
2.95
1.98
2.96
1.97
2.97
1.94
2.99
2.81
3.02
3.31
3.67
4.62
3.80
4.89
5.52
6.09
6.43
4.21
4.18
5.38
5.87
6.25
6.59
4.24
5.31
5.83
6.08
6.32
4.24
5.22
5.61
5.78
5.98
4.28
5.16
5.47
5.62
5.82
4.34
5.12
5.45
5.60
5.78
4.29
5.08
5.35
5.51
5.74
4.34
5.06
5.32
5.50
5.69
4.45
5.02
5.28
5.46
5.64
4.93
5.49
5.83
B I F - I N S U R E D SAVINGS B A N K S 4
8 Negotiable order of withdrawal accounts
Savings deposits 3
9
Interest-bearing time deposits with balances of
less than $100,000, by maturity
10 7 to 91 days
I I 92 to 182 days
12 183 days to 1 year
13 More than 1 year to 2 '/2 years
14 More than 2'/2 years
5.37
5.94
6.32
6.68
Amounts outstanding (millions of dollars)
INSURED C O M M E R C I A L B A N K S
15 Negotiable order of withdrawal accounts
16 Savings deposits 3
1 / Personal
18
Nonpersonal
19
20
21
22
23
Interest-bearing time deposits with balances of
less than $100,000, by maturity
7 to 91 days
92 to 182 days
183 days to 1 year
More than 1 year to 2 years
More than 2 vi years
24 IRA and Keogh plan deposits
305,237
767,035
598,276
168,759
304,896
737,068
580,438
156,630
292,811
713,440
564,086
149,354
286,987
698,963
550,674
148,289
274,281
714,989
560,563
154,426
274,573
718,393
563,795
154,599
271,777
723,302
567,624
155,678
266,715
733,011
572,916
160,096
253,174
744,839
584,239
160,600
258,411
747,943
587,235
160,707
259,470
768,718
600,847
167,871
29,362
109,050
145,386
139,781
180,461
32,265
96,650
163,062
164,395
192,712
31,623
95,583
176,657
183,275
194,722
31,530
94,368
179,625
189,652
194,426
31,472
93,188
184,560
194,963
192,542
32.140
91,999
187,185
198,541
195,024
32,950
91,347
186,716
201,761
194,500
30,722
89,896
187,141
203,466
199,944
29,804
92,220
189,338
203,548
200,182
29,940
94,418
188,859
206,993
200,201
31,046
97,145
189,124
210,377
202,338
144,011
144,097
145,959
146,679
146,842
148,894
148,878
149,320
149,570
151,094
155,056
11,191
80,376
77,263
3,113
11,175
70,082
67,159
2,923
11,218
68,595
65,692
2,902
11,005
67,453
64.204
3,248
11,019
67,322
64,484
2,838
11,354
67,185
63,966
3,219
11,262
66,706
63,524
3,182
11,104
66,776
63,483
3,293
11,408
69,752
66,403
3,349
11,317
69,636
66,193
3,443
11,613
70,265
66,683
3,582
2,746
12,974
17,469
16,589
20,501
2,144
11,361
18,391
17.787
21,293
1,943
11,707
20,277
22,648
22,446
1,780
11,245
21,051
23,445
22,671
1,885
11,449
20,956
24,014
22,819
1,567
11,025
21,702
24,658
22,935
1,784
11,131
22,157
25,141
22,930
1,873
11,183
22,488
25,296
22,780
1,739
11,258
24,837
27,825
23,351
1,768
11,231
25,036
27,755
23,470
1,903
11,848
25,887
28,247
23,574
19,791
19,008
20,221
20,388
20,236
20,499
20,568
20,531
21,913
21,784
21,758
B I F - I N S U R E D SAVINGS B A N K S 4
25 Negotiable order of withdrawal accounts
26 Savings deposits 3
27
Personal
28
Nonpersonal
29
30
31
32
33
Interest-bearing time deposits with balances of
less than $100,000, b\ maturity
7 to 91 days
92 to 182 days
183 days to 1 year
More than 1 year to 2 'A years
More than 2 V2 years
34 IRA and Keogh plan accounts
I. BIF, Bank Insurance Fund. Data in this table also appear in the Board's H.6 (508)
Special Supplementary Table monthly statistical release. For ordering address, see inside
front cover. Estimates are based on data collected by the Federal Reserve System from a
stratified random sample of about 425 commercial banks and 75 savings banks on the last day
of each month. Data are not seasonally adjusted and include IRA and Keogh deposits and
foreign currency-denominated deposits. Data exclude retail repurchase agreements and deposits held in U.S. branches and agencies of foreign banks.
2. As of October 31, 1994, interest rate data for NOW accounts and savings deposits
reflect a series break caused by a change in the survey used to collect these data.
3. Includes personal and nonpersonal money market deposits.
4. Includes both mutual and federal savings banks.
Monetary and Credit Aggregates
1.23
A17
B A N K DEBITS A N D DEPOSIT TURNOVER 1
Debits are in billions of dollars; turnover is ratio of debits to deposits; monthly data are at annual rates
1995r
Bank group, or type of deposit
2
1992
I993
2
2
1994
Apr.
4 Other checkable deposits4
5 Savings deposits (including MMDAs)5
July
Aug.
Sept.
Seasonally adjusted
DEBITS
Demand deposits3
1 All insured banks
Major New York City banks
2
Other banks
3
June
May
313,128.1
165,447.7
147,680.4
334,784.1
171,224.3
163,559.7
369,029.1
191,168.8
177,860.3
367,823.2
185,842.3
181,981.0
423,264.5
217,587.7
205,676.7
413,335.1
203,342.3
209,992.8
391,037.6
197,712.1
193,325.5
407,356.9
206,835.9
200,521.0
399.316.1
207,562.6
191,753.5
3,780.3
3,309.1
3,481.5
3,497.4
3,798.6
3,766.3
3,707.7
3,565.4
4,236.4
4,022.4
4,142.3
4,326.8
3,593.9
3,986.6
4,236.4
4,745.3
4,367.1
4,896.6
825.9
4,795.3
428.7
785.9
4,198.1
424.6
817.4
4,481.5
435.1
817.2
4,553.3
444.6
943.3
5,170.7
505.8
901.8
4,718.9
505.7
849.4
4,624.7
462.9
887.9
4,970.9
480.7
861.2
5,017.7
454.1
14.4
4.7
11.9
4.6
12.6
4.9
12.7
5.0
15.0
5.6
15.1
6.0
12.9
5.5
15.5
6.5
16.3
6.6
DEPOSIT TURNOVER
Demand deposits'
6 All insured banks
7
Major New York City banks
8
Other banks
9 Other checkable deposits4
10 Savings deposits (including MMDAs)5
Not seasonally adjusted
DEBITS
Demand deposits3
11 All insured banks
12
Major New York City banks
Other banks
13
14 Other checkable deposits4
15 Savings deposits (including MMDAs)5
313,344.9
165,595.0
147,749.9
334,899.2
171,283.5
163,615.7
369,121.8
191,226.0
177,895.7
362,784.7
180,169.1
182,615.6
412,762.0
207,259.8
205,502.2
425,855.1
209,349.5
216,505.6
390,210.5
196,873.1
193,337.5
421,841.6
213,958.6
207,883.0
396,666.0
207,994.2
188,671.8
3,783.6
3,310.0
3,481.7
3,498.3
3,795.6
3,764.4
3,918.1
3,726.8
4,070.1
3,982.3
4,261.6
4,432.7
3,525.6
4,054.0
4,203.6
4,750.0
4,432.2
4,847.4
826.1
4,803.5
428.8
786.1
4,197.9
424.8
818.2
4,490.3
435.3
805.8
4,459.5
445.6
936.5
5,095.1
513.6
941.3
4,972.0
527.7
848.2
4,657.5
462.8
936.7
5,343.0
506.6
859.6
5,069.5
448.7
14.4
4.7
11.9
4.6
12.6
4.9
13.2
5.2
14.5
5.6
15.7
6.1
12.9
5.6
15.6
6.5
16.7
6.6
DEPOSIT T U R N O V E R
Demand deposits3
16 All insured banks
Major New York City banks
17
18
Other banks
19 Other checkable deposits4
20 Savings deposits (including MMDAs)5
1. Historical tables containing revised data for earlier periods can be obtained from the
Publications Section, Division of Support Services, Board of Governors of the Federal
Reserve System, Washington, DC 20551.
Data in this table also appear in the Board's G.6 (406) monthly statistical release. For
ordering address, see inside front cover.
2. Annual averages of monthly figures.
3. Represents accounts of individuals, partnerships, and corporations and of states and
political subdivisions.
4. As of January 1994, other checkable deposits (OCDs), previously defined as automatic
transfer to demand deposits (ATSs) and negotiable order of withdrawal (NOW) accounts,
were expanded to include telephone and preauthorized transfer accounts. This change
redefined OCDs for debits data to be consistent with OCDs for deposits data.
5. Money market deposit accounts.
A18
Domestic Financial Statistics • February 1996
1.26
ASSETS AND LIABILITIES OF COMMERCIAL BANKS'
B i l l i o n s o f dollars
Monthly averages
1994
Account
Nov.
1995'
May
June
July
Aug.
ALL COMMERCIAL
BANKING INSTITUTIONS
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
1995
Sept.
Oct.
Nov.
Nov. 8
Nov. 15
Nov. 22
Nov. 29
Seasonally adjusted
Assets
Bank credit
Securities in bank credit
U.S. government securities
Other securities
Loans and leases in bank credit- . . .
Commercial and industrial
Real estate
Revolving home equity
Other
Consumer
Security'
Other
Interbank loans 4
Cash assets 5
Other assets 6
28 Residual (assets less liabilities) 9
3,499.3
973.7
711.5
262.2
2,525.6
692.0
1,051.6
77.6
974.0
478.1
89.9
214.0
187.4
211.3
226.5
3,516.1
964.2
705.9
258.4
2,551.9
697.5
1,062.6
78.0
984.6
481.1
89.3
221.4
195.1
214.2
227.0
3,531.1
971.2
710.2
261.0
2,559.9
698.8
1,067.9
78.4
989.5
486.3
84.6
222.4
192.1
209.0
226.7
3,551.9
976.7
707.6
269.1
2,575.2
702.6
1,071.7
78.7
993.0
489.2
87.1
224.6
196.0
212.4
231.1
3,555.1
975.8
712.5
263.3
2,579.2
703.3
1,074.4
78.7
995.8
489.1
84.7
227.7
199.9
220.7
230.5
3,559.8
972.1
712.6
259.5
2,587.7
708.5
1,076.0
79.1
996.9
491.1
83.9
228.2
200.4
211.7
229.1
3,556.7
968.9
711.7
257.3
2,587.8
706.1
1,076.3
79.1
997.3
490.5
87.1
227.7
218.5
213.1
226.9
3,556.8
970.4
710.6
259.8
2,586.4
708.0
1,075.5
79.1
996.4
491.7
83.3
228.0
197.8
214.1
231.2
3,565.7
975.0
715.5
259.5
2,590.7
709.4
1,076.5
79.2
997.3
490.7
84.6
229.5
197.8
220.8
229.3
3,560.8
974.2
713.2
261.0
2,586.7
710.3
1,076.2
79.3
997.0
491.9
81.0
227.3
188.8
194.6
227.4
4,049.2
4,067.7
4,0953
4,102.0
4,134.6
4,149.6
4,144.6
4,158.7
4,143.5
4,157.4
4,115.4
2,567.3
785.3
1,782.0
392.9
1,389.2
688.9
187.9
500.9
239.2
214.9
2,584.5
781.2
1,803.3
395.9
1,407.4
676.4
187.9
488.5
244.2
213.7
2,608.6
793.4
1,815.2
400.8
1,414.4
691.7
201.9
489.8
236.5
204.4
2.614.7
784.8
1,829.9
407.3
1,422.6
672.1
197.4
474.7
248.0
207.1
2,628.0
782.3
1,845.7
413.2
1,432.5
676.4
201.2
475.3
254.2
216.4
2,643.0
780.2
1,862.8
422.0
1,440.9
674.5
206.1
468.5
259.2
213.6
2,634.7
765.1
1,869.7
422.5
1,447.2
655.6
202.6
453.0
263.0
212.6
2,637.9
767.5
1,870.4
424.6
1,445.8
657.4
216.8
440.5
272.3
212.4
2,645.0
772.8
1,872.2
424.0
1,448.2
647.9
201.2
446.7
256.6
214.7
2,643.6
776.0
1,867.6
421.5
1,446.2
665.0
200.6
464.4
260.3
213.0
2,607.4
740.1
1,867.3
419.7
1,447.6
652.2
192.3
459.9
262.8
208.6
3,5023 r
27 Total liabilities
3,483.7
977.0
713.7
263.3
2.506.7
689.1
1,042.6
77.2
965.5
473.0
90.1
211.9
185.3
210.8
226.2
2,521.3
797.2
1,724.2
359.1
1,365.0
590.9r
168.9'
422.0
213.6
176.5
Liabilities
Deposits
Transaction
Nontransaction
Large time
Other
Borrowings
From banks in the U.S
From nonbanks in the U.S
Net due to related foreign offices
Other liabilities 8
3,300.1
954.2
732.5
221.6
2,345.9
638.4
991.5
74.9
916.5
445.2
73.3
197.6
170.4r
205.8
220.9
3,841.0 r
16 Total assets 7
17
18
19
20
21
22
23
24
25
26
Wednesday figures
3,7103
3,718.8
3,7413
3,742.0
3,775.0
3,7903
3,765.9
3,780.0
3,764.2
3,781.9
3,731.0
338.6r
338.9
348.9
354.0
360.0
359.6
359.3
378.7
378.7
379.3
375.5
384.4
Not seasonally adjusted
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
Assets
Bank credit
Securities in bank credit
U.S. government securities
Other securities
Loans and leases in bank credit- . . .
Commercial and industrial
Real estate
Revolving home equity
Other
Consumer
Security 1
Other
Interbank loans 4
Cash assets 5
Other assets 6
45
46
47
48
49
50
51
52
53
54
55 Total liabilities
56 Residual (assets less liabilities)
Footnotes appear onfollowingpage.
9
3,495.8
974.5
711.2
263.3
2,521.3
693.9
1,051.4
77.7
973.7
475.5
85.9
214.7
184.4
209.5
225.1
3,502.9
959.7
702.0
257.7
2,543.2
696.7
1,061.9
78.0
983.9
478.8
83.9
221.8
191.0
211.1
226.5
3,521.2
968.7
711.0
257.8
2,552.4
695.4
1,067.1
78.5
988.6
485.8
81.5
222.6
187.4
201.3
228.5
3,547.0
972.4
709.3
263.0
2,574.7
698.8
1,073.0
79.1
993.9
490.3
85.4
227.1
192.3
213.9
231.6
3,553.6
973.6
711.2
262.4
2,580.0
700.9
1,077.1
79.3
997.8
489.1
84.1
228.8
198.3
221.1
232.4
3,569.4
973.0
713.4
259.5
2,596.5
708.1
1,081.2
79.5
1,001.7
491.2
86.2
229.8
202.3
218.0
231.8
3,569.3
971.4
713.8
257.6
2,597.9
705.5
1,082.2
79.6
1,002.7
490.0
91.3
228.8
214.4
208.0
230.9
3,568.3
973.3
712.1
261.2
2,595.0
706.9
1,081.1
79.5
1,001.6
491.5
85.3
230.2
204.6
230.2
234.2
3,569.5
974.2
714.8
259.4
2,595.3
709.6
1,080.5
79.5
1,001.0
490.5
85.1
229.5
195.1
220.3
228.8
3,569.9
972.7
713.3
259.4
2,597.2
710.3
1,081.1
79.6
1,001.6
493.0
83.1
229.7
194.3
210.5
230.9
4,032.1
4,057.8
4,074.8
4,081.5
4,127.9
4,148.9
4,164.9
4,166.0
4,180.7
4,157.2
4,149.1
2,536.4
811.3
1.725.1
358.3
1,366.8
604.1'
173.2'
431.0
213.4
181.6
2,558.3
774.1
1,784.1
397.1
1,387.0
674.7
182.4
492.2
244.6
213.0
2,581.6
775.6
1,806.0
398.4
1,407.6
683.4
187.8
495.6
238.3
208.9
2,599.5
784.1
1,815.4
400.2
1,415.2
692.6
198.2
494.4
234.0
201.7
2,600.6
768.8
1,831.9
408.0
1,423.9
681.0
195.2
485.9
243.1
206.4
2,624.4
779.5
1,844.9
413.1
1.431.8
686.4
199.1
487.3
247.7
216.0
2,638.6
777.9
1,860.7
419.8
1,441.0
681.8
203.5
478.2
258.4
215.2
2,650.1
779.5
1,870.6
421.7
1,448.9
676.0
207.6
468.4
262.6
218.4
2,644.4
768.3
1,876.1
424.0
1,452.1
682.8
219.7
463.1
265.0
217.5
2,675.7
801.3
1,874.5
422.1
1,452.4
675.8
209.9
465.9
251.3
220.3
2,644.7
778.2
1,866.4
421.2
1,445.2
673.7
200.5
473.3
262.5
218.7
2,630.4
766.2
1,864.3
419.4
1,444.9
670.6
199.6
471.0
272.5
215.6
3,535.5 r
Liabilities
Deposits
Transaction
Nontransaction
Large time
Other
Borrowings
From banks in the U.S
From nonbanks in the U.S
Net due to related foreign offices
Other liabilities 8
3,475.5
978.3
712.8
265.5
2,497.2
692.2
1,041.0
77.0
963.9
471.5
83.9
208.6
179.7
208.3
225.5
3,860.8 r
44 Total assets 7
3,309.5r
955.9
733.7
222.2
2,353.6
638.4
996.2
75.4
920.9
445.4
75.0
198.5
171.9'
212.3
223.7
3,690.5
3,7123
3,727.8
3,7313
3,774.5
3,793.9
3,807.0
3,809.7
3,823.1
3,799.5
3,789.2
341.5
345.5
346.9
350.3
353.4
354.9
357.9
356.3
357.6
357.7
359.9
325.3
Commercial Banking Institutions
1.26
A19
A S S E T S A N D LIABILITIES OF COMMERCIAL B A N K S ' — C o n t i n u e d
B i l l i o n s o f dollars
Wednesday figures
Monthly averages
Nov.
May
June
July
Aug.
DOMESTICALLY CHARTERED
COMMERCIAL BANKS
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
Oct.
Nov.
Nov. 8
Nov. 15
Nov. 22
Nov. 29
83 Total liabilities
9
3,081.7
860.2
647.0
213.1
2,221.5
516.6
1,004.3
77.2
927.1
473.0
54.0
173.6
160.9
182.6
170.6
3,099.1
858.6
647.0
211.6
2.240.6
519.0
1,013.4
77.6
935.8
478.1
55.4
174.6
164.8
184.5
170.3
3,110.7
849.4
641.5
207.9
2,261.2
523.6
1,024.7
78.0
946.7
481.1
52.1
179.7
173.2
187.5
172.5
3,123.8
852.6
643.1
209.5
2,271.3
524.6
1,030.9
78.4
952.5
486.3
50.4
179.1
165.5
182.7
171.9
3,139.2
857.3
643.3
214.0
2,281.9
526.8
1,035.2
78.7
956.5
489.2
50.8
179.9
168.6
187.1
174.2
3,146.5
856.6
648.5
208.2
2,289.8
529.1
1,037.5
78.7
958.9
489.1
50.4
183.7
168.4
194.2
175.3
3,154.4
855.4
648.5
206.9
2,299.1
532.6
1,039.5
79.1
960.4
491.1
52.7
183.2
170.4
183.0
174.8
3,156.3
854.9
648.6
206.3
2,301.5
532.4
1,039.9
79.1
960.8
490.5
54.8
183.8
175.1
184.5
172.5
3,153.7
854.3
647.9
206.4
2,299.4
532.7
1,038.8
79.1
959.8
491.7
53.5
182.7
172.3
185.4
176.8
3,156.4
855.9
649.1
206.8
2,300.6
533.5
1,039.8
79.2
960.7
490.7
52.3
184.2
171.8
191.0
175.0
3,152.0
856.8
649.1
207.7
2,295.2
531.8
1,039.8
79.3
960.6
491.9
50.0
181.7
164.0
167.0
173.8
3,539.0
3,561.7
3,586.8
3,5873
3,612.3
3,627.9
3,6263
3,632.1
3,631.8
3,637.9
3,600.6
2,366.8
787.3
1,579.6
217.8
1,361.8
491.1'
154.0r
337.7
66.4
131.5
2,409.5
775.9
1,633.6
247.1
1,386.6
569.9
165.2
404.8
84.0
147.4
2,424.2
771.9
1,652.2
247.6
1,404.6
563.6
168.5
395.0
90.2
146.7
2,447.5
784.0
1,663.5
247.9
1,415.6
573.1
182.3
390.8
82.2
139.1
2,448.3
775.5
1,672.8
248.9
1,423.9
556.0
179.3
376.7
91.0
139.3
2,457.3
773.3
1,684.0
251.9
1,432.1
562.0
183.0
379.0
93.4
146.2
2,468.2
771.1
1,697.2
257.4
1,439.8
565.3
186.9
378.4
94.7
143.7
2,465.8
755.4
1,710.4
264.6
1,445.8
552.9
183.8
369.1
90.1
144.3
2,464.7
757.7
1,707.1
262.9
1,444.2
553.3
198.2
355.0
96.0
145.0
2,475.8
763.1
1,712.7
265.7
1,447.0
546.8
182.2
364.6
86.0
146.5
2,477.5
766.2
1,711.3
265.3
1,446.0
559.6
180.1
379.5
87.4
144.8
2,440.7
730.6
1,710.1
264.7
1,445.4
552.0
174.8
377.2
91.6
140.3
3,056.5 R
Liabilities
Deposits
Transaction
Nontransaction
Large time
Other
Borrowings
From banks in the U.S
From nonbanks in the U.S
Net due to related foreign offices . . . .
Other liabilities 8
2,951.7
871.2
670.9r
200.4
2,080.5
476.8
950.5
74.9
875.5
445.2
46.0
162.0
147. r
181.5
167.1
339UR
Bank credit
Securities in bank credit
U.S. government securities
Other securities
Loans and leases in bank credit2
Commercial and industrial
Real estate
Revolving home equity
Other
Consumer
Security-'
Other
Interbank loans 4
Cash assets 5
Other assets 6
84 Residual (assets less liabilities)
Sept.
Seasonally adjusted
72 Total assets 7
73
74
75
76
77
78
79
80
81
82
1995
1995'
1994
Account
3,210.8
3,224.6
3,241.9
3,234-5
3,258.9
3,272.0
3,253.1
3,259.0
3,255.1
3,2693
3,224.6
328.2
337.0
344.9
352.8
353.4
355.9
373.2
373.1
376.7
368.7
376.0
334.7
Not seasonally adjusted
85
86
87
88
89
90
91
92
93
94
95
96
97
98
99
Bank credit
Securities in bank credit
U.S. government securities
Other securities
Loans and leases in bank credit2
Commercial and industrial
Real estate
Revolving home equity
Other
Consumer
Security-1
Other
Interbank loans 4
Cash assets 5
Other assets 6
100 Total assets 7
101
102
103
104
105
106
107
108
109
110
Liabilities
Deposits
Transaction
Nontransaction
Large time
Other
Borrowings
From banks in the U.S
From nonbanks in the U.S
Net due to related foreign offices . . . .
Other liabilities 8
111 Total liabilities
112 Residual (assets less liabilities) 9
Footnotes appear on following page.
2,959.9
871.9
670.6
201.2
2,088.0
476.9
955.1
75.3
879.8
445.4
47.2
163.4
I48.7r
188.1
168.8
3,080.1
862.6
647.9
214.7
2,217.5
520.5
1,002.7
77.0
925.7
471.5
51.9
171.0
155.7
181.4
169.9
3,100.0
861.6
647.9
213.7
2,238.4
520.8
1,013.2
77.6
935.6
475.5
54.2
174.6
163.1
182.0
169.6
3,100.9
845.8
638.5
207.3
2,255.1
522.4
1,024.1
78.0
946.1
478.8
50.1
179.7
168.7
184.2
172.9
3,115.7
850.4
644.2
206.2
2,265.4
520.8
1,030.0
78.5
951.5
485.8
49.3
179.5
162.0
174.3
172.9
3,137.6
854.3
645.5
208.7
2,283.3
523.5
1,036.2
79.1
957.2
490.3
50.9
182.4
163.9
187.2
175.6
3,147.4
853.9
647.0
206.9
2,293.5
527.8
1,040.2
79.3
960.9
489.1
51.1
185.4
165.5
193.8
177.6
3,163.4
855.6
647.9
207.7
2,307.8
532.4
1,044.6
79.5
965.1
491.2
54.4
185.2
173.5
189.5
176.5
3,165.5
856.3
648.8
207.5
2,309.2
532.2
1,045.7
79.5
966.1
490.0
56.2
185.1
177.2
179.5
175.7
3,164.4
856.0
647.7
208.4
2,308.3
532.5
1,044.4
79.5
964.9
491.5
54.5
185.4
179.2
201.0
179.0
3,163.3
855.2
647.7
207.5
2,308.1
533.5
1,043.8
79.5
964.3
490.5
55.0
185.2
170.5
190.9
173.5
3,160.8
855.2
647.9
207.3
2,305.6
531.6
1,044.7
79.6
965.1
493.0
51.9
184.5
166.8
183.1
176.4
3,409.1 R
3,530.3
3,557.8
3,570.1
3,568.2
3,607.4
3,628.0
3,646.4
3,6413
3,667.0
3,641.6
3,630.6
2,383.5
801.4
1,582.1
218.0
1,364.1
505.2r
I57.7r
347.6
64.9
136.0
2,398.5
765.2
1,633.3
248.7
1,384.6
560.3
161.9
398.5
91.8
145.2
2,418.3
766.5
1,651.8
247.2
1,404.6
568.6
168.2
400.4
89.6
142.9
2,438.5
774.7
1,663.8
248.0
1,415.9
571.3
178.2
393.1
81.8
138.0
2,434.6
759.5
1,675.1
250.7
1,424.4
562.9
177.3
385.6
89.1
138.2
2,454.5
769.9
1,684.6
252.9
1,431.8
571.2
180.4
390.8
88.7
145.9
2,467.8
768.5
1,699.3
258.4
1,440.9
572.9
185.4
387.5
92.0
146.4
2,482.5
769.7
1,712.8
264.7
1,448.1
574.3
188.3
386.0
88.4
149.1
2,472.8
758.6
1,714.1
263.7
1,450.5
577.0
200.4
376.6
91.8
149.3
2,507.8
791.2
1,716.6
265.2
1,451.4
574.6
189.5
385.1
81.9
150.9
2,479.7
768.5
1,711.2
265.7
1,445.6
572.7
180.8
391.9
87.8
149.5
2,465.1
756.6
1,708.6
264.4
1,444.1
573.1
181.3
391.8
92.4
145.9
3,089.6 R
3,195.8
3,219.4
3,229.7
3,224.7
3,260.4
3,279.0
3,2943
3,290.8
33153
3,289.8
3,276.6
334.5
338.4
340.4
343.5
347.1
349.0
352.1
350.5
351.8
351.8
354.0
319.5
A20
DomesticNonfinancialStatistics • February 1996
NOTES TO TABLE 1.26
I. Covers the following types of institutions in the fifty states and the District of
Columbia: domestically chartered commercial banks that submit a weekly report of condition
(large domestic); other domestically chartered commercial banks (small domestic); branches
and agencies of foreign banks; New York State investment companies, and Edge Act and
agreement corporations (foreign-related institutions). Excludes international banking facilities. Data are Wednesday values, or pro rata averages of Wednesday values. Large domestic
banks constitute a universe; data for small domestic banks and foreign-related institutions are
estimates based on weekly samples and on quarter-end condition reports. Data are adjusted
for breaks caused by reclassifications of assets and liabilities.
2. Excludes federal funds sold to, reverse repurchase agreements with, and loans to
commercial banks in the United States.
3. Consists of reserve repurchase agreements with broker-dealers and loans to purchase
and carry securities.
4. Consists of federal funds sold to, reverse repurchase agreements with, and loans to
commercial banks in the United States.
5. Includes vault cash, cash items in process of collection, demand balances due from
depository institutions in the United States, balances due from Federal Reserve Banks, and
other cash assets.
6. Excludes the due-from position with related foreign offices, which is included in lines
25, 53, 81, and 109.
7. Excludes unearned income, reserves for losses on loans and leases, and reserves for
transfer risk. Loans are reported gross of these items.
8. Excludes the due-to position with related foreign offices, which is included in lines 25,
53, 81, and 109.
9. This balancing item is not intended as a measure of equity capital for use in capital
adequacy analysis.
Weekly Reporting Commercial Banks
1.27
A21
ASSETS AND LIABILITIES OF LARGE WEEKLY REPORTING COMMERCIAL BANKS
Millions of dollars, Wednesday figures
1995
Account
Nov. 15
Nov. 22
Nov. 29
Oct. 4
Oct. 11
Oct. 18
Oct. 25
Nov. 1
Nov. 8
116,244
299,66 l r
23,486
276,176r
104,228r
132,703
298,900'
23,542
275,358r
103,94 r
110,443r
298,085
23,691
274,395
I04,743r
114,416r
300,052
23,368
276,684
106,3l3r
135,624
299,893
21,730
278,163
107,042
111,258
300,140
22,176
277,965
107,153
128,260
300,710
24,475
276,235
106,431
117,603
300,094
24,622
275,472
107,743
112,645
299,211
25,727
273,484
108,360
42,976
71,227r
57,745r
I23,648r
1,435
62,632r
19,612
4,982r
14,630r
43,020r
59,580
43,573
70,438r
57,405r
I22,454r
1,253
62,660r
19,609
5,034
14,576
43,050r
58,542
43,518
70,082r
56,052r
121,772
1,265
62,697
19,602
5,029
14,573
43,095
57,810
44,054
70,207r
56,1 I T
123,910
1,326
63,282
19,663
5,019
14,644
43,620
59,302
44,980
69,938
56,202
124,975
1,447
63,976
19,568
5,005
14,563
44,409
59,552
45,009
70,072
55,731
123,868
1,636
64,237
19,555
5,004
14,551
44,682
57,995
44,696
69,460
55,647
124,124
1,642
64,871
19,543
5,010
14,534
45,327
57,612
43,791
69,021
54,917
123,533
1,806
65,180
19,623
5,027
14,597
45,557
56,546
42,618
68,386
54,120
123,259
1,873
64,677
19,636
5,010
14,627
45,041
56,708
95,791
62,837
27,758
5,197
1,254,996
345,458
1,604
343,854
341,276
2,578
499,075
47,751
451,323
247,017
66,772
39,100
3,354
24,318
13,442
6,762
10,926
997
26,770
37,778
1,693
33,889
1,219,413
146,459r
102,149
67,852
28,886
5,410
1,259,015r
345,009r
1,682
343,327r
340,707r
2,620
501,503
47,864
453,639
246,792
66,445
39,162
2,738
24,545
15,501
6,706
10,805
1,089
27,057
38,108
1,761
33,505r
1,223,749
139,198
104,717r
66,824r
31,466
6,426
l,256,133r
345,303r
1,527
343,776r
34l,l74 r
2,602
499,973
47,826
452,147
245,936
65,335
37,954
2,907
24,475
15,096
6,649
10,874
975
27,815
38,177
1,764
33,507r
1,220,862
I38,729r
106,132r
71,253r
29,198
5,680
l,252,097r
345,763r
1,505
344,258r
34l,673 r
2,585
499,576
47,824
451,752
245,260
62,286
35,336
2,687
24,263
15,227
6,582
10,839
1,003
27,236r
38,325
1,764
33,450r
l,216,883r
136,315'
107,070
69,511
32,666
4,894
1,266,762
351,125
1,509
349,616
346,996
2,620
502,042
47,985
454,057
246,105
63,959
35,731
3,425
24,803
16,153
6,583
10,887
995
30,292
38,623
1,769
33,441
1,231,553
142,318
112,585
72,904
35,125
4,556
1,268,627
350,157
1,444
348,714
346,109
2,605
505,254
47,985
457,269
246,407
66,542
38,342
2,881
25,318
14,989
6,520
10,794
1,422
27,548
38,994
1,783
33,665
1,233,179
137,438
111,975
73,241
34,341
4,393
1,266,389
350,063
1,744
348,319
345,705
2,614
503,089
48,039
455,050
246,579
66,885
38,820
2,806
25,258
14,031
6,615
10,857
1,015
28,098
39,157
1,758
33,698
1,230,933
142,999
102,337
66,752
32,587
2,999
1,268,439
350,778
1,546
349,233
346,614
2,619
502,003
48,038
453,965
246,405
66,324
37,936
3,024
25,364
16,342
6,537
10,902
983
28,836
39,330
1,749
33,628
1,233,062
138,039
101,015
66,340
30,614
4,061
1,264.866
348,765
1,553
347,213
344,666
2,547
501,942
48,026
453,916
247,279
66,143
37,541
3,213
25,390
15,434
6,461
10,838
1,009
27,555
39,439
1,725
33,499
1,229,642
138,456
2,001,217r
2,019,151
l,994,608 r
l,997,707 r
2,041,433
2,018,468
2,039,001
2,014,667
2,004,227
ASSETS
1 Cash and balances due from depository institutions
2 U.S. Treasury and government securities
Trading account
3
Investment account
4
Mortgage-backed securities'
5
All others, by maturity
One year or less
One year through five years
7
X
More than five years
9 Other securities
Trading account
10
Investment account
11
State and local government, by maturity
12
One year or less
13
More than one year
14
Other bonds, corporate stocks, and securities
15
Other trading account assets
16
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 in securities
To others3
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 depository and financial institutions
Commercial banks in the United States
Banks in foreign countries
Nonbank depository and other 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 reserve3
Other loans and leases, net
All other assets
45 Total assets
Footnotes appear on the following page.
A22
1.27
DomesticNonfinancialStatistics • February 1996
ASSETS AND LIABILITIES OF LARGE WEEKLY REPORTING COMMERCIAL BANKS—Continued
Millions of dollars, Wednesday figures
1995
Account
Nov. 8
Nov. 15
Nov. 22
Nov. 29
1,210,635
321,559
268,143
53,416
9,297
2,596
26,039
5,540
515
9,428
99,798
789,278
765,544
23,734
19,865
2,243
1,297
328
1,187,627
297,252
253,831
43,421
7,835
1,504
18,902
4,816
962
9,401
98,804
791,571
769,127
22,443
19,907
816
1,400
320
1,216,934
325,762
272,471
53,291
9,098
3,277
25,635
5,213
592
9,475
98,376
792,797
770,448
22,349
19,678
787
1,571
314
1,192,446
307,450
256,643
50,807
8,760
2,501
21,493
5,653
1,159
11,240
96,927
788,069
765,499
22,570
20,002
692
1,559
317
1,184,303
302,468
256,047
46,422
8,856
1,765
19,811
5,601
655
9,733
96,132
785,703
763,554
22,149
19,694
665
1,496
294
4l0,758 r
120
7,300
403,339r
226,505r
420,083
0
5,343
414,740
219,890
417,919
0
32
417,887
221,276
415,329
0
2,695
412,635
214,795
411,051
2,163
5,756
403,133
218,745
409,951
300
6,440
403,211
218,044
L,806,657R
1,850,607
1,826,821
1,847,058
1,822,243
1,812,299
190,826
191,647
191,943
192,424
191,929
1,693,459
117,924
1,383
281
1,102
26,318
85,214
1,693,973
116,769
1,372
281
1,091
26,211
86,397
1,691,136
117,391
1,363
281
1,082
25,577
76,844
1,689,715
117,269
1,352
281
1,071
25,849
83,322
1,684,469
116,249
1,351
279
1,072
26,122
87,056
Oct. 4
Oct. 11
Oct. 18
Oct. 25
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
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 . .
l,189,956r
307,917r
R
261,25 L
46,666
8,230
1,874
21,147
5,642
921
8,852
101,570
780,469
757,664
22,805
19,143
2,301
1,048
313
1,201,515
319,624
267,694
51,930
7,826
1,584
23,359
5,419
613
13,129
99,962
781,929
758,868
23,061
19,219
2,306
1,222
314
l,176,277r
296,386r
250,760r
45,627r
7,895
1,745
19,313r
6,243
575
9,856
98,883
781,008
757,870
23,137
19,201
2,243
1,380
313
l,l69,394 r
290,203r
R
245,30 L
44,902r
8,195
1,549
20,428r
5,219
675
8,836
97,222
781,969
758,389
23,579
19,676
2,195
1,400
308
64 Liabilities for borrowed money5
65
Borrowings from Federal Reserve Banks
66
Treasury tax and loan notes
67
Other liabilities for borrowed money6
68 Other liabilities (including subordinated notes and debentures) . . .
413,846
0
11,614
402,232
207,994
411,666
825
7,706
403,135
215,372
408,700
0
6,166
402,534
2l8,859 r
L,811,796R
1,828,553
L,803,836R
Nov.
1
LIABILITIES
69 Total liabilities
70 Residual (total assets less total liabilities)7
189,421
190,598
1,672,159
109,984
1,432
280
1,151
25,941
76,443
l,675,503r
110,190
1,422
281
1,141
26,430
82,673
190,772
191,051
1,675,929r
112,89 l r
1,411
281
1,130
25,896
87,340
l,675,602r
115,667r
1,402
281
1,121
26,545
96,166
MEMO
71
72
73
74
75
76
77
Total loans and leases, gross, adjusted, plus securities8
Time deposits in amounts of $100,000 or more
Loans sold outright to affiliates9
Commercial and industrial
Other
Foreign branch credit extended to U.S. residents10
Net owed 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 (NOWs) and automatic transfer service (ATS)
accounts, 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 capitaladequacy 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.
Weekly Reporting Commercial Banks
1.28
A23
LARGE WEEKLY REPORTING U.S. BRANCHES AND AGENCIES OF FOREIGN BANKS
Assets and Liabilities
Millions of dollars, Wednesday
figures
1995
Account
Oct. 4
Oct. 11
Oct. 18
Oct. 25
Nov. 1
Nov. 8
Nov. 15
Nov. 22
Nov. 29
ASSETS
1 Cash and balances due from depository
institutions
2 U.S. Treasury and government agency
securities
3 Other securities
4 Federal funds sold'
To commercial banks in the United States
5
To others2
6
7 Other loans and leases, gross
8
Commercial and industrial
Bankers acceptances and commercial paper .
9
All other
10
U.S. addressees
11
12
Non-U.S. addressees
Loans secured by real estate
13
Loans to depository and financial
14
institutions
Commercial banks in the United States
15
Banks in foreign countries
16
Nonbank financial institutions
17
For purchasing and carrying securities
18
19 To foreign governments and official
institutions
20
All other
21 Other assets (claims on nonrelated parties)
17,711
16,562
17,104
17,255
17,925
18,320
18,402
17,138
41,476
38,216r
31,249
10,981
20,267
176,453r
112,730r
4,046r
108,684
103,718
4,966
23,101
42,896
38,18 l r
33,468
10,986
22,482
!76,353r
112,787r
4,146r
108,642r
103,770r
4,872
22,931'
43,129
37,544r
37,246
14,813
22,433
177,022r
113,389r
4,118r
109,271
104,415
4,856
22,923r
43,941
35,504
37,318
13,476
23,842
177,600
113,876
4,464
109,412
104,580
4,832
22,794
43,463
33,727
38,391
14,290
24,101
177,032
113,500
4,448
109,052
104,225
4,827
22,779
42,887
35,370
29,293
8,908
20,384
177,210
113,689
4,454
109,235
104,325
4,910
22,754
44,649
34,776
27,005
8,435
18,570
178,962
114,694
4,632
110,062
104,955
5,107
22,740
43,479
34,968
30,002
10,032
19,970
180,797
116,502
4,648
111,854
106,706
5,147
22,623
29,216r
4,030r
2,416
22,770r
6,255
28,180r
4,054'
2,369
2l,757 r
5,925
28,292r
4,227r
2,402
21,663r
6,402r
28,426r
3,982r
2,912
21,532r
6,019
28,355
3,899
3,014
21,442
6,616
28,782
4,058
2,932
21,792
6,044
28,641
3,605
2,972
22,064
5,807
28,780
3,736
3,046
21,998
6,812
29,246
3,486
3,119
22,641
6,503
898
4,257
36,782r
899
4,213
37,918r
867
3,806
37,773r
517
4,312
37,350r
463
4,122
40,187
440
4,115
38,811
463
4,392
39,916
452
4,113
40,166
455
4,102
39,456
366,163
22 Total assets 1
17,055
41,884
37,947
28,563
9,391
19,172
178,493r
113,346'
4,130r
109,217
104,209
5,007
23,102
368,700R
370,144R
373,23LR
376,531
374,666
367,678
368,476
370,656
111,124
3,837
3,024
813
107,287
75,410
31,878
108,831
3,998
3,131
867
104,833
73,581
31,252
108,976
3,710
2,772
939
105,265
74,664
30,601
108,105
3,803
3,112
692
104,301
74,131
30,170
109,003
4,077
3,098
979
104,927
75,103
29,824
108,947
4,033
3,051
982
104,914
75,492
29,422
106,360
4,240
3,109
1,131
102,120
73,247
28,873
104,999
4,077
3,022
1,056
100,921
72,801
28,121
105,647
4,010
3,145
865
101,638
73,555
28,083
75,572
40,464
6,779
33,685
35,109
4,955
30,154
53,392
77,136
43,623
8,178
35,446
33,513
4,914
28,599
55,322r
78,617
45,052
8,884
36,168
33,565
4,395
29,169
54,296r
73,873
44,936
7,302
37,634
28,937
4,234
24,703
52,517r
75,109
44,782
7,857
36,925
30,327
4,397
25,930
54,460
73,574
45,233
8,262
36,970
28,341
4,524
23,817
53,422
69,343
42,372
9,103
33,268
26,971
4,688
22,283
55,738
70,245
44,715
8,967
35,748
25,530
4,605
20,925
55,841
67,879
43,455
8,511
34,945
24,424
4,670
19,754
56,517
366,163
368,700R
370,144R
373,231R
376,531
374,666
367,678
368,476
370,656
273,466r
100,635
272,359r
101,734
275,686r
103,344'
276,147r
114,902r
276,989
113,233
274,265
113,407
272,246
111,555
273,220
112,876
275,728
115,797
LIABILITIES
23 Deposits or credit balances owed to other
than directly related institutions
24 Demand deposits4
Individuals, partnerships, and corporations . . . .
25
26
Other
27 Nontransaction accounts
Individuals, partnerships, and corporations . . . .
28
29
Other
Borrowings from other than directly
30
related institutions
31 Federal funds purchased5
37
From commercial banks in the United States . .
From others
33
34 Other liabilities for borrowed money
To commercial banks in the United States
35
To others
36
37 Other liabilities to nonrelated parties
38 Total liabilities 6
MEMO
39 Total loans (gross) and securities, adjusted7
40 Net owed to related institutions abroad
1. Includes securities purchased under agreements to resell.
2. Includes transactions with nonbank brokers and dealers in securities.
3. For U.S. branches and agencies of foreign banks having a net "due from" position,
includes net due from related institutions abroad.
4. Includes other transaction deposits.
5. Includes securities sold under agreements to repurchase.
6. For U.S. branches and agencies of foreign banks having a net "due to" position,
includes net owed to related institutions abroad.
7. Excludes loans to and federal funds transactions with commercial banks in the United
States.
A24
1.32
DomesticNonfinancialStatistics • February 1996
COMMERCIAL PAPER AND BANKERS DOLLAR ACCEPTANCES OUTSTANDING
Millions of dollars, end of period
1995
Year ending December
Item
1990
1991
1992
1994
1993
May
June
July
Aug.
Sept.
Oct.
Commercial paper (seasonally adjusted unless noted otherwise)
562,656
1 All issuers
Financial companies'
2
Dealer-placed paper", total
3
Directly placed paper , total
4 Nonfinancial companies
4
528,832
545,619
555,075
595,382
650,580
648,819
657,938
660,719
669,686 r
673,392
214,706
200,036
212,999
182,463
226,456
171,605
218,947
180,389
223,038
207,701
258,006
216,879
251,555
218,005
262,695
215,473
261,904
215,361
268,838
213,883r
271,299
215,214
147,914
133,370
147,558
155,739
164,643
175,695
179,259
179,770
183,454
186,965
186,879
n.a.
n.a.
n.a.
Bankers dollar acceptances (not seasonally adjusted)5
5 Total
6
7
8
9
10
By holder
Accepting banks
Own bills
Bills bought from other banks
Federal Reserve Banks6
Foreign correspondents
Others
By basis
11 Imports into United States
12 Exports from United States
13 All other
54,771
43,770
38,194
32,348
29,835
9,017
7,930
1,087
11,017
9,347
1,670
10,555
9,097
1,458
12,421
10,707
1,714
11,783
10,462
1,321
918
44,836
1,739
31,014
1,276
26,364
725
19,202
410
17,642
13,095
12,703
28,973
12,843
10,351
20,577
12,209
8,096
17,890
10,217
7,293
14,838
10,062
6,355
13,417
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. As reported by financial companies that place their paper directly with investors.
4. Includes public utilities and firms engaged primarily in such activities as communications, construction, manufacturing, mining, wholesale and retail trade, transportation, and
services.
n.a.
n.a.
n.a.
5. Data on bankers dollar acceptances are gathered from approximately 1()0 institutions.
The reporting group is revised every January. Beginning January 1995, data for Bankers
dollar acceptances will be reported annually in September.
6. In 1977 the Federal Reserve discontinued operations in bankers dollar acceptances for
its own account.
Financial Markets
1.33
PRIME RATE C H A R G E D BY B A N K S
A25
Short-Term Business Loans 1
Percent per year
Date of change
1993
Jan
Rate
1
6.00
1994—Mar.
Apr.
May
Aug.
Nov.
24
19
17
16
15
6.25
6.75
7.25
7.75
8.50
1995—Feb.
July
1
7
9.00
8.75
8.50
Period
Average
rate
1993
1994
1995 .
6.00
7.15
8.83
1993—Jan
Feb
Mar.
Apr
Mav
June
July
Aug
Sept
Oct
Nov
Dec
6.00
6.00
6.00
6.00
6.00
6.00
6 00
6.00
6.00
6.00
6.00
6.00
I. The prime rate is one of several base rates that banks use to price short-term business
loans. The table shows the date on which a new rate came to be the predominant one quoted
by a majority of the twenty-tive largest banks by asset size, based on the most recent Call
Period
1994—Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Dec
Average
rate
6.00
6.00
6.06
6.45
6.99
7.25
7.25
7.51
7.75
7.75
8.15
8.50
Period
1995—Jan
Feb
Mar
Apr.
May
June
July
Aug
Sept
Oct
Dec
Average
rate
8.50
9.00
9.00
9.00
9.00
9.00
8.80
8.75
8.75
8.75
8.75
8.65
Report. Data in this table also appear in the Board's H.15 (519) weekly and G.13 (415)
monthly statistical releases. For ordering address, see inside front cover,
A26
1.35
DomesticNonfinancialStatistics • February 1996
INTEREST RATES
Money and Capital Markets
Percent per year; figures are averages of business day data unless otherwise noted
1995
Item
1992
1993
1995, week ending
1994
Aug.
Sept.
Oct.
Nov.
Oct. 27
Nov. 3
Nov. 10
Nov. 17
Nov. 24
M O N E Y M A R K E T INSTRUMENTS
1 Federal funds1,2"1
2 Discount window borrowing2'4
3.52
3.25
3.02
3.00
4.21
3.60
5.74
5.25
5.80
5.25
5.76
5.25
5.80
5.25
5.76
5.25
5.76
5.25
5.71
5.25
5.74
5.25
5.81
5.25
156
3
4
5
Commercial paper ' '
1-month
3-month
6-month
3.71
3.75
3.80
3.17
3.22
3.30
4.43
4.66
4.93
5.85
5.82
5.75
5.82
5.74
5.66
5.81
5.82
5.71
5.80
5.74
5.59
5.81
5.82
5.70
5.80
5.79
5.67
5.81
5.75
5.61
5.81
5.74
5.60
5.80
5.72
5.56
6
7
8
Finance paper, directly placed1"5'7
1-month
3-month
6-month
3.62
3.65
3.63
3.12
3.16
3.15
4.33
4.53
4.56
5.72
5.64
5.51
5.71
5.58
5.45
5.71
5.66
5.51
5.69
5.59
5.35
5.71
5.67
5.51
5.71
5.64
5.48
5.71
5.60
5.39
5.70
5.59
5.34
5.68
5.58
5.30
3.62
3.67
3.13
3.21
4.56
4.83
5.68
5.62
5.66
5.58
5.71
5.61
5.64
5.47
5.73
5.62
5.67
5.54
5.64
5.50
5.64
5.47
5.64
5.44
3.64
3.68
3.76
3.11
3.17
3.28
4.38
4.63
4.96
5.77
5.77
5.79
5.74
5.73
5.73
5.75
5.79
5.76
5.75
5.74
5.64
5.75
5.79
5.75
5.75
5.77
5.71
5.74
5.74
5.65
5.75
5.74
5.65
5.74
5.73
5.61
3.70
3.18
4.63
5.79
5.74
5.81
5.75
5.82
5.79
5.75
5.75
5.75
3.43
3.54
3.71
3.00
3.12
3.29
4.25
4.64
5.02
5.40
5.41
5.43
5.28
5.30
5.31
5.28
5.32
5.28
5.36
5.27
5.14
5.24
5.31
5.27
5.31
5.27
5.19
5.38
5.29
5.16
5.38
5.29
5.14
5.35
5.27
5.14
3.45
3.57
3.75
3.02
3.14
3.33
4.29
4.66
5.02
5.41
5.40
5.55
5.26
5.28
5.21
5.30
5.34
5.30
5.35
5.29
5.15
5.22
5.33
n.a.
5.29
5.31
n.a.
5.36
5.29
n.a.
5.43
5.33
5.15
5.34
5.25
n.a.
3.89
4.77
5.30
6.19
6.63
7.01
n.a.
7.67
3.43
4.05
4.44
5.14
5.54
5.87
6.29
6.59
5.32
5.94
6.27
6.69
6.91
7.09
7.49
7.37
5.75
5.98
6.10
6.24
6.41
6.49
6.92
6.86
5.62
5.81
5.89
6.00
6.13
6.20
6.65
6.55
5.59
5.70
5.77
5.86
5.97
6.04
6.45
6.37
5.43
5.48
5.57
5.69
5.83
5.93
6.33
6.26
5.58
5.67
5.75
5.84
5.95
6.04
6.40
6.35
5.48
5.54
5.64
5.75
5.87
5.98
6.36
6.30
5.45
5.51
5.62
5.73
5.85
5.97
6.35
6.29
5.43
5.48
5.58
5.71
5.85
5.96
6.34
6.27
5.44
5.49
5.56
5.70
5.84
5.92
6.36
6.26
7.52
6.45
7.41
6.90
6.63
6.43
6.31
6.39
6.34
6.32
6.32
6.33
6.09
6.48
6.44
5.38
5.83
5.60
5.77
6.17
6.18
5.83
5.95
6.06
5.71
5.90
5.91
5.74
5.95
5.80
5.63
5.79
5.64
5.72
5.90
5.76
5.74
5.84
5.70
5.55
5.78
5.68
5.61
5.76
5.65
5.61
5.76
5.65
8.55
7.54
8.26
7.81
7.56
7.39
7.30
7.37
7.33
7.32
7.30
7.32
8.14
8.46
8.62
8.98
8.52
7.22
7.40
7.58
7.93
7.46
7.97
8.15
8.28
8.63
8.29
7.57
7.69
7.79
8.19
7.84
7.32
7.45
7.56
7.93
7.55
7.12
7.27
7.39
7.75
7.36
7.02
7.18
7.32
7.68
7.30
7.10
7.25
7.37
7.73
7.40
7.05
7.21
7.35
7.70
7.33
7.04
7.20
7.34
7.71
7.38
7.02
7.18
7.32
7.69
7.27
7.03
7.19
7.33
7.71
7.29
2.99
2.78
2.82
2.49
2.42
2.41
2.37
2.41
2.41
2.37
2.40
2.35
9
10
Bankers acceptances1
3-month
6-month
s s
19
II
12
13
Certificates of deposit, secondary marker
1-month
3-month
6-month
14 Eurodollar deposits, 3-month' 110
18
19
20
U.S. Treasury bills
Secondary market1'5
3-month
6-month
1-year
Auction average1"'5'"
3-month
6-month
1-year
21
22
23
24
25
26
27
28
Constant maturities12
1-year
2-year
3-year
5-year
7-year
10-year
20-year
30-year
15
16
17
U S . TREASURY NOTES AND B O N D S
Composite
29 More than 10 years (long-term)
STATE AND LOCAL NOTES AND B O N D S
Moody's series11
30 Aaa
31 Baa
32 Bond Buyer series14
CORPORATE B O N D S
33 Seasoned issues, all industries'5
34
35
36
37
38
Rating group
Aaa
Aa
A
Baa
A-rated, recently offered utility bonds16
MEMO
Dividend-price ratio17
39 Common stocks
1. The daily effective federal funds rate is a weighted average of rates on trades through
New York brokers.
2. Weekly figures are averages of seven calendar days ending on Wednesday of the
current week; monthly figures include each calendar day in the month.
3. Annualized using a 360-day year for bank interest.
4. Rate for the Federal Reserve Bank of New York.
5. Quoted on a discount basis.
6. An average of offering rates on commercial paper placed by several leading dealers for
firms whose bond rating is AA or the equivalent.
7. An average of offering rates on paper directly placed by finance companies.
8. Representative closing yields for acceptances of the highest-rated money center banks.
9. An average of dealer offering rates on nationally traded certificates of deposit.
10. Bid rates for Eurodollar deposits at 11:00 a.m. London time. Data are for indication
purposes only.
11. Auction date for daily data; weekly and monthly averages computed on an issue-date
basis.
12. Yields on actively traded issues adjusted to constant maturities. Source: US. Department of the Treasury.
13. General obligation bonds based on Thursday figures; Moody's Investors Service.
14. State and local government general obligation bonds maturing in twenty years are used
in compiling this index. The twenty-bond index has a rating roughly equivalent to Moodys'
A1 rating. Based on Thursday figures.
15. Daily figures from Moody's Investors Service. Based on yields to maturity on selected
long-term bonds.
16. Compilation of the Federal Reserve. This series is an estimate of the yield on recently
offered, A-rated utility bonds with a thirty-year maturity and five years of call protection.
Weekly data are based on Friday quotations.
17. Standard & Poor's corporate series. Common stock ratio is based on the 500 stocks in
the price index.
NOTE. Some of the data in this table also appear in the Board's H.15 (519) weekly and
G. 13 (415) monthly statistical releases. For ordering address, see inside front cover.
Financial Markets
1.36
STOCK M A R K E T
All
Selected Statistics
1995
Indicator
1992
1993
1994
Apr.
Mar.
May
July
June
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)
2
Industrial
3
Transportation
4
Utility
5
Finance
229.00
284.26
201.02
99.48
1 79.29
249.71
300.10
242.68
114.55
216.55
254.16
315.32
247.17
104.96
209.75
266.81
337.96
252.37
102.08
213.29
274.38
347.69
254.36
104.70
219.38
281.81
357.01
254.70
106.02
228.45
289.52
366.75
256.80
108.12
236.26
298.18
379.13
279.15
109.59
240.49
300.05
379.79
285.63
111.06
245.27
310.41
390.42
295.54
114.67
260.72
311.78
389.63
291.16
123.59
265.12
317.58
398.66
300.06
119.49
266.12
6 Standard & Poor's Corporation
(1941-43 = 10)'
415.75
451.63
460.42
493.20
507.91
523.83
539.35
557.37
559.11
578.77
582.92
595.53
7 American Stock Exchange
(Aug. 31, 1973 = 50) 2
391.28
438.77
449.49
456.06
471.54
487.03
492.60
513.25
526.86
547.64
530.26
529.93
202,558
14,171
263,374
18,188
290,652
17.951
338,733
17,905
331,184
19,404
341,905
19,266
345,547
24,622
363,780
23,283
309,879
21,825
352,184
25,422
369,386
17,865
360,199
16,724
Volume of trading (thousands of shares)
8 New York Stock Exchange
9 American Stock Exchange
Customer financing (millions of dollars, end-of-period balances)
10 Margin credit at broker-dealers'
43,990
60,310
61,160
60,270
62.520
64,070
66,340
67,600
71,440
77,076
75,005
77,875
Free credit balances at brokers4
11 Margin accounts'
12 Cash accounts
8,970
22,510
12,360
27,715
14,095
28.870
12,745
26,680
12,440
26,670
13,403
27,464
13,710
29,860
13,830
28,600
13,900
29.190
14,806
29,796
14,753
29,908
15,509
30,340
Margin requirements (percent of market value and effective date) 6
Mar. 11, 1968
13 Margin stocks
14 Convertible bonds
15 Short sales
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. In July 1976 a financial group, composed of banks and insurance companies, was added
to the group of stocks on which the index is based. The index is now based on 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 broker-dealers 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. Series initiated in June 1984.
6. Margin 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
Jan. 3, 1974
50
50
50
collateralized by securities. Margin requirements on securities other than options are the
difference between the market value (100 percent) and the maximum loan value of collateral
as prescribed by the Board. Regulation T was adopted effective Oct. 15, 1934; Regulation U,
effective May 1, 1936; Regulation G, effective Mar. II, 1968; and Regulation X, effective
Nov. 1, 1971.
On Jan. I, 1977. the Board of Governors for the first time established in Regulation T the
initial margin required for writing options on securities, setting it at 30 percent of the current
market value of the stock underlying the option. On Sept. 30, 1985, the Board changed the
required initial margin, allowing it to be the same as the option maintenance margin required
by the appropriate exchange or self-regulatory organization; such maintenance margin rules
must be approved by the Securities and Exchange Commission. Effective Jan. 31. 1986. the
SEC approved new maintenance margin rules, permitting margins to be the price of the option
plus 15 percent of the market value of the stock underlying the option.
Effective June 8, 1988, margins were set to be the price of the option plus 20 percent of the
market value of the stock underlying the option (or 15 percent in the case of stock-index
options).
A28
1.38
DomesticNonfinancialStatistics • February 1996
FEDERAL FISCAL AND FINANCING OPERATIONS
Millions of dollars
Fiscal year
Calendar year
Type of account or operation
1995
1993
1994
1995
June
U.S. budget1
1 Receipts, total
2
On-budget
3
Off-budget
4 Outlays, total
5
On-budget
6
Off-budget
7 Surplus or deficit ( - ) . total
8 • On-budget
9
Off budget
Sonn e of financing (total)
10 Borrowing from the public
1 1 Operating cash (decrease, or increase ( - ) )
12 Other"
July
Aug.
Sept.
Oct.
Nov.
1,153,226
841.292
311,934
1.408,532
1,141.945
266.587
-255,306
-300.653
45,347
1,257,4511
922,425r
335,026
l,460,553r
l,18l,18l r
279,372
-203,370
258,756r
55,654
1,350,576
999,496
351,080
1,514,389
1,225,724
288,665
-163,813
-226,228
62,415
147,868
1 15,998
31,870
135,054
120,236
14,818
12.814
-4,237
17,051
92,749
65,788
26.961
106,328
80,931
25,397
-13,579
-15,143
1,564
96,560
69,265
27,295
130,411
104,135
26,276
-33,851
-34,870
1,019
143,219
112,510
30,709
135,933
105,098
30,836
7,286
7,412
-126
95,593
72,200
23,393
118,352
92,151
26,200
-22,758
-19,951
-2,807
90,008
63,651
26,357
128,458
101,767
26,691
-38,450
-38,116
-334
248,594
6.283
429
184,696'
16,564
l,842r
171,288
-2,007
-5,468
8,491
-34,312
12,250
10,627
11,635
-8,683
16,071
30,776
-12,996
-6,618
-19,820
19,152
13,353
16,755
-7,350
38,339
-4,911
5,022
52.506
17.289
35,217
35,942
6,848
29,094
37,949
8,620
29,329
60,540
20,977
39,563
48,905
11,206
37,700
18,129
4,767
13,363
37,949
8,620
29,329
21,194
7,018
14,176
26,105
5,703
20,402
MEMO
13 Treasury operating balance (level, end of
period)
14
Federal Reserve Banks
IS
Tax and loan accounts
1. Since 1990, off-budget items have been the social security trust funds (federal old-age
survivors insurance and federal disability insurance) and the U.S. Postal Service.
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 loanvaluation adjustment; and profit on sale of gold.
SOURCE. U.S. Department of the Treasury, Monthly Treasury Statement of Receipts and
Outlays of the U.S. Government; and U.S. Office of Management and Budget, Budget of the
U.S. Government.
Federal Finance
1.39
A29
U.S. B U D G E T RECEIPTS A N D OUTLAYS'
Millions of dollars
Calendar year
Fiscal year
Source or type
1994
1993
1994
1995
1995
1995
H2
HI
H2
HI
Sept.
Oct.
Nov.
RECEIPTS
1,257,453
1,350,576
582,038
652,234
625,557
710,542
143,219
95,593
90,008
543,055
459,699
70
160,047
76,761
590,157
499,898
69
175,815
85,624
262,073
228,423
2
41,768
8,115
275,052
225,387
63
117,937
68,325
273,474
240,062
10
42,031
9,207
307,498
251,398
58
132,006
75,958
60,909
36,295
1
24,743
2,551
51,840
46,918
0
5,899
978
39,524
39,945
1
1,991
2,414
154,205
13,820
461,475
428,810
24,433
28,004
4,661
174,422
17,334
484,474
451,046
27,127
28,878
4,550
68,266
6,514
206,176
192,749
4,335
11,010
2,417
80,536
6,933
248,301
228,714
20,762
17,301
2,284
78,392
7,331
220,141
206,613
4,135
11,177
2,349
92,132
10,399
261,837
228,663
23,429
18,001
2,267
33,719
730
39,902
39,304
2,910
235
364
4,813
2,633
32,104
30,549
-98
1,214
342
3,056
1,362
38,199
34,919
91
2,940
340
55,225
20,099
15,225
21,988
57,485
19,300
14,764
27,306
25,994
10,215
6,617
9,227
26,444
9,500
8,197
11,170
30,062
11,042
7,071
13,305
27,452
8,847
7,424
15,749
5,706
1,634
1,289
789
4,453
1,786
1,160
2,070
5,154
1,593
1,349
2,496
1,460,553
1,514,428
727,685
710,620
752,151r
760,824
135,972
118,352
128,458
National defense
International affairs
General science, space, and technology
Energy
Natural resources and environment
Agriculture
281.563
17,083
16,227
5,219
21,064
15,057
272,179
16,448
17,563
5,146
23,328
9,763
146,672
10,186
8,880
1,663
11,221
7,516
133,844
5,800
8,502
2,237
10,111
7,451
141,884
11,889
7,604R
2,923
11,911
7,623
135,931
4,727
8,611
2,358
10,273
4,039
26,040
1,479
1,612
969
1,915
-102
18,353
1,074
1,427
348
2,835
1,109
21,234
1,616
1,474
489
2,245
2,291
75
26
27
28
Commerce and housing credit
Transportation
Community and regional development
Education, training, employment, and
social services
-5,122
38,134
10,454
-18,740
38,555
11,000
-1,490
19,570
4,288
-4,962
16,739
4,571
-4,270
21,835
6,282R
-13,936
18,192
4,858
2,490
3,719
1,043
-1,661
3,128
943
-1,465
3,284
1,087
27,449R
79
30
31
Health
Social security and Medicare
Income security
37
33
34
35
36
Veterans benefits and services
Administration of justice
General government
Net interest6
Undistributed offsetting receipts7
1
All sources
7
3
4
5
6
10
II
12
13
Individual income taxes, net
Withheld
Presidential Election Campaign Fund
Nonwithheld
Refunds
Corporation income taxes
Gross receipts
Refunds
Social insurance taxes and contributions, net . . .
Employment taxes and contributions"
Self-employment taxes and contributions1 .
Unemployment insurance
Other net receipts4
14
15
16
17
Excise taxes
Customs deposits
Estate and gift taxes
Miscellaneous receipts5
18
All types
19
70
21
77
73
24
7
8
OUTLAYS
46,307
52,706
26,753
19,262
25,738
4,802
3,556
4,185
106,836
464,312
214,036
114,760
495,701
220,214
52,958
223,735
102,380
53,195
232,777
109,080
54,147
236,817
101,806
58,759
251,975
117,639
9,401
42,605
19,591
9,657
40,732
14,522
10,189
41,947
18,134
37,642
15,238
11,316
202,957
-37,772
37,935
16,255
13,856
232,175
-44,455
19,852
7,400
6,531
99,914
-20,344
16,686
7,718
5,084
99,844
-17,308
19,761
7,753
7,355R
109,435
-20,066
19,267
8,062
5,797
116,170
-17,632
4,517
1,335
1,385
18,929
-5,796
1,594
1,223
1,712
20,565
-2,765
3,280
1,258
717
19,058
-2,565
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. Rents and royalties for the outer continental shelf, U.S. government contributions for
employee retirement, and certain asset sales.
SOURCE. U.S. Department of the Treasury, Monthly Treasury Statement of Receipts and
Outlays of the U.S. Government-, and U.S. Office of Management and Budget, Budget of the
U.S. Government, Fiscal Year 1996.
A30
DomesticNonfinancialStatistics • February 1996
1.40
FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION
Billions of dollars, end of month
1993
1995
1994
Item
Sept. 30
Dec. 31
Mar. 31
June 30
Sept. 30
Dec. 31
Mar. 31
June 30
Sept. 30
1 Federal debt outstanding
4,436
4,562
4,602
4,673
4,721
4,827
4,891
4,978
5,001
2 Public debt securities
3
Held by public
4
Held by agencies
4.412
3.295
1,117
4.536
3.382
1,154
4,576
3.434
1.142
4,646
3.443
1,203
4.693
3.480
1.213
4,800
3,543
1,257
4,864
3.610
1.255
4,951
3.635
1,317
4,974
n.a.
n.a.
2_i
25
0
27
27
0
26
26
0
28
27
0
29
29
0
27
27
0
27
26
0
27
27
0
27
n.a.
n.a.
4,316
4,446
4,491
4,559
4,605
4,711
4,775
4,861
4,885
4,315
0
4.445
0
4,491
0
4.559
0
4.605
0
4,711
0
4,774
0
4,861
0
4,885
0
4,900
4,900
4,900
4.900
4.900
4.900
4,900
4,900
4,900
5 Agency securities
6
Held by public
7
Held by agencies
8 Debt subject to statutory limit
9 Public debt securities
10 Other debt1
MEMO
11 Statutory debt limit
I. Consists of guaranteed debt of U.S. Treasury and other federal agencies, specified
participation certificates, notes to international lending organizations, and District of Columbia stadium bonds.
1.41
GROSS PUBLIC DEBT OF U.S. TREASURY
SOURCES. U.S. Department of the Treasury, Monthly Statement of the Public Debt of the
United States and Treasury Bulletin.
Types and Ownership
Billions of dollars, end of period
1994
Type and holder
1991
1992
1993
1995
1994
Q4
1 Total gross public debt
By tvpe
•> Interest-bearing
3
Marketable
4
Bills
5
Notes
6
Bonds
7
Nonmarketable1
8
State and local government series
9
Foreign issues"
1(1
Government
11
Public
Savings bonds and notes
12
13
Government account series'
14 Non-interest-bearing
flv 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
21
Other companies
22
State and local treasuries
Individuals
Savings bonds
23
24
Other securities
Foreign and international'
25
26
Other miscellaneous investors6
Q2
Q3
3,801.7
4,177.0
4,535.7
4,800.2
4,800.2
4,864.1
4,951.4
4,974.0
3,798.9
2.471.6
590.4
1.430.8
435.5
1.327.2
159.7
41.9
41.9
.0
135.9
959.2
2.8
4.173.9
2,754.1
657.7
1,608.9
472.5
1,419.8
153.5
37.4
37.4
.0
155.0
1.043.5
3.1
4,532.3
2,989.5
714.6
1,764.0
495.9
1.542.9
149.5
43.5
43.5
.0
169.4
1.150.0
3.4
4.769.2
3.126.0
733.8
1,867.0
510.3
1,643.1
132.6
42.5
42.5
.0
177.8
1,259.8
31.0
4,769.2
3.126.0
733.8
1,867.0
510.3
1,643.1
132.6
42.5
42.5
.0
177.8
1,259.8
31.0
4,860.5
3,227.3
756.5
1,938.2
517.7
1.633.2
122.9
41.8
41.8
.0
178.8
1,259.2
3.6
4,947.8
3,252.6
748.3
1,974.7
514.7
1,695.2
121.2
41.4
41.4
.0
180.1
1,322.0
3.6
4,950.6
3,260.5
742.5
1,980.3
522.6
1,690.2
1 13.4
41.0
41.0
.0
1 31.2
1,324.3
23.3
968.7
281.8
2.563.2
232.5
80.0
181.8
150.8
485.1
1.047.8
302.5
2.839.9
294.4
79.7
197.5
192.5
476.7
1.153.5
334.2
3,047.7
322.2
80.8
234.5
213.0
508.9
1.257.1
374.1
3,168.0
290.6
67.6
242.8
226.5
443.3
1.257.1
374.1
3.168.0
290.6
67.6
242.8
226.5
443.3
1.254.7
369.3
3,239.1
303.5
67.7
259.0
230.3
415.2
1,316.6
389.0
3,244.6
305.0
58.7
260.0
227.7
415.0
138.1
125.8
491.7
677.4
157.3
131.9
549.7
760.2
171.9
137.9
623.0
755.4
180.5
152.5
688.6
875.6
180.5
152.5
688.6
875.6
181.4
161.4
729.6
891.0
182.6
161.6
783.7
850.4
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.
Ql
n.a.
5. Consists of investments of foreign balances and international accounts in the United
States.
6. Includes savings and loan associations, nonprofit institutions, credit unions, mutual
savings banks, corporate pension trust funds, dealers and brokers, certain U.S. Treasury
deposit accounts, and federally sponsored agencies.
SOURCES. U.S. Treasury Department, data by type of security, Monthly Statement of the
Public Debt of the United States: data by holder. Treasury Bulletin.
Federal Finance
1.42
U.S. G O V E R N M E N T SECURITIES DEALERS
A31
Transactions'
Millions of dollars, daily averages
1995, week ending
1995
Item
Aug.
Sept.
Oct.
44,812
48,527
45,143
42,343
43,957
48,337
41,331
49,500
61,110
76,647
51,747
42,849
88,513
51,000
21,039
27,588
89,933
49,005
24,972
29,574
90,911
49,652
24,297
30,050
85,213
45,286
27,231
23,234
76,008
45,596
21,597
41,187
89,090
56,156
23,937
34,205
98,718
48,121
24.225
20,949
106,331
51,779
26,012
27,425
102,544
48,882
27,912
56,101
84,443
49,291
24,657
35,160
93,256
57,066
26,202
22,998
94,036
39,249
25,154
23,445
107,723
757
8,587
110,578
661
11,127
107,881
712
11,589
100,148
757
8,511
96,410
723
15,046
112,366
583
13,277
109,545
666
8,369
120,333
881
1 1,492
123,848
881
17,754
116,751
909
14,568
116,031
664
8,887
98,686
624
8,638
76,601
20,282
19,001
76,887
24,311
18,447
77,825
23,586
18,461
72,694
26,475
14,723
69,151
20,875
26,141
81,217
23,354
20,928
78,625
23,559
12,579
87,277
25,131
15,933
88,689
27,031
38,347
93,629
23,748
20,592
86,038
25,538
14,111
77,448
24,530
14,806
Oct.
4
Oct.
11
Oct.
18
Oct.
25
Nov.
1
Nov.
8
Nov.
15
Nov.
22
Nov.
29
OUTRIGHT TRANSACTIONS 2
1
2
3
4
5
6
7
8
9
10
11
By type of security
U.S. Treasury bills
Coupon securities, by maturity
Five years or less
More than five years
Federal agency
Mortgage-backed
By type of counterparty
With interdealer broker
U.S. Treasury
Federal agency
Mortgage-backed
With other
U.S. Treasury
Federal agency
Mortgage-backed
FUTURES T R A N S A C T I O N S '
12
13
14
15
16
By type of deliverable security
U.S. Treasury bills
Coupon securities, by maturity
Five years or less
More than five years
Federal agency
Mortgage-backed
764
990
606
390
378
585
743
908
1,025
915
527
577
1,747
13,206
0
0
2,070
16,073
0
0
1,577
14,681
0
0
1,519
15,109
0
0
1,452
13,858
0
0
1,448
15,320
0
0
1,742
13,797
0
0
1,733
15,696
0
0
1,832
13,829
0
0
1,444
15,234
0
0
2,570
16,203
0
0
2,390
11,456
0
0
OPTIONS TRANSACTIONS 4
17
18
19
20
21
By type of underlying security
U.S. Treasury bills
Coupon securities, by maturity
Five years or less
More than five years
Federal agency
Mortgage-backed
0
0
0
0
0
0
0
0
0
0
2,262
4,032
0
1,123
1,602
4,257
0
897
2,129
4,714
0
983
2,162
3,907
0
1,201
2,497
4,808
0
1,243
2,092
6,107
0
1,334
1,486
3,764
0
572
2,492
4,647
0
571
2,518
4,580
0
1,922
1,422
5,049
0
1,270
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. Monthly averages are based on the number of trading days in the month.
Transactions are assumed evenly distributed among the trading days of the report week.
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. Outright transactions include immediate and forward transactions. Immediate delivery
refers to purchases or sales of securities (other than mortgage-backed federal 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 mortgagebacked agency securities include purchases and sales for which delivery is scheduled in thirty business
days or less. Stripped securities are reported at market value by maturity of coupon or corpus.
n.a.
1,664
5,778
0
1,015
0
1,001
2,691
0
310
Forward transactions are agreements made in the over-the-counter market that specify
delayed delivery. Forward contracts for U.S. Treasury securities and federal agency debt
securities are included when the time to delivery is more than five business days. Forward
contracts for mortgage-backed agency securities are included when the time to delivery is
more than thirty business days.
3. Futures transactions are standardized agreements arranged on an exchange. All futures
transactions are included regardless of time to delivery.
4. 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, "n.a." indicates that data are not published because of insufficient activity.
Major changes in the report form filed by primary dealers induced a break in the dealer data
series as of the week ending July 6, 1994.
A32
1.43
DomesticNonfinancialStatistics • February 1996
U.S. GOVERNMENT SECURITIES DEALERS
Positions and Financing1
Millions of dollars
1995
1995, week ending
Item
Aug.
Sept.
Oct.
Oct. 4
Oct. 11
Oct. 18
Oct. 25
Nov. 1
Nov. 8
Nov. 15
Nov. 22
Positions"
NET OUTRIGHT POSITIONS 3
By type of security
1 U.S. Treasury bills
Coupon securities, by maturity
2
Five years or less
3
More than five years
Federal agency
5 Mortgage-backed
5.044
7,744
-64
-2,108
-349
3,679
373
-3,245
883
27,013
11,183
778
-17,786
19,128
30.040
7,088
-17.370
21,837
32,596
14,476
-15,124
24,009
36,240
13,277
-16.905
25,168
32,985
7,447
-15,567
23,566
38.074
8,169
-14,084
22,486
38,282
23,422
-16,029
25.158
36,631
20,395
-13,579
24,188
33,432
18,006
-10,673
26,453
34,810
6,063
-11,541
21,572
34,594
7,567
-7,770
20,156
35,726
-3,539
-2,437 r
-3,462
-2,074 r
-2.100
-3,439
-3,963
-5,420
-4,751
-4,674
-5,451
2,329
-1,283
0
0
952
-8,204
0
0
-930
-13,744
0
0
961
-8,879
0
0
-376
-11.754
0
0
-646
-14,280
0
0
-1,244
-14,853
0
0
-2,804
-17,390
0
0
-4,437
-18,632
0
0
-4,570
-17,461
0
0
-4,849
-15,764
0
0
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
3,620
389
0
1,751
1.272
2,424
0
1,557
1,809
3,644
0
1,326
1,238
4,679
0
988
-528
2,076
0
1,116
NET FUTURES POSITIONS 4
By type of deliverable security
6 U.S. Treasury bills
Coupon securities, by maturity
7
Five years or less
8
More than five years
9 Federal agency
10 Mortgage-backed
NET OPTIONS POSITIONS
11
12
13
14
15
By type of deliverable security
U.S. Treasury bills
Coupon securities, by maturity
Five years or less
More than five years
Federal agency
Mortgage-backed
0
2.239
-2,883
0
1,567
2,175
-3.203
0
1,111
3,044
-427
0
1,591
2,089
-2.163
0
1,758
3.962
-1,606
0
891
3,613
-1,516
0
2,063
0
Financing5
Reverse repurchase agreements
16 Overnight and continuing
17 Term
222,242r
408,236r
2l9,028 r
420,162r
228,244
420,502
213,015
408,953r
221,956
406,176
234,243
429,820
224,810
434,248
242,740
418,006
248,826
452,959
259,558
378,518
232,402
394,835
Securities borrowed
18 Overnight and continuing
19 Term
156,456
62,392
164,552
64,797
162,865
65,506
166,763
63,271
162,135
63,979
161,437
67,270
163,402
64,833
162,158
67,506
152,704
72,258
156,442
63,511
148,923
62,110
2,063
112
2,547
87
2.377
43
2.538
42
2,568
49
2,693
33
2,097
51
2,006
37
1,895
52
1,888
112
1,808
22
Repurchase agreements
22 Overnight and continuing
23 Term
478,290r
344,994r
496,262r
356,122r
509,729
356,682
497,264r
335,226r
504.181
334,171
512,491
363,840
498,152
375,729
534,796
366,676
545,731
399,698
558,030
328.008
460,497
401,933
Securities loaned
24 Overnight and continuing
25 Term
4,631
2,102
6,312
2,478
6,037
2,776
6,004
3,012
5,995
2,896
6,165
2,738
5,856
2,682
6,170
2,631
6,197
2,711
7,112
2,855
4.969
2.991
Securities pieclged
26 Overnight and continuing
27 Term
28.712
3.062
33,053
3,643
29,767
3,892
31,518
3,880
29,612
3,929
30,590
3,864
28,724
3,851
29,037
3,939
28,422
3,762
27,629
4,096
26,633
5.066
Collateralized loans
28 Overnight and continuing
29 Term
17.000'
n.a.
I4,676r
2,528
16,631
2,367
I4,258r
2,528
17,308
1,184
18,191
2.958
16,557
2,767
15.692
2,486
17,533
1,942
20,719
2,361
15,199
2.164
MEMO: Matched book6
Securities in
30 Overnight and continuing
31 Term
210.359'
388,104'
217,342r
404.573r
232,058
410,727
222,846
397.195r
226.323
396,212
237,029
421,379
232,898
421,296
238.111
411.926
242,689
448,559
260,282
374,658
228,587
396.538
Securities out
32 Overnight and continuing
33 Term
308,231r
290,927'
318,299r
299,735r
321,797
302,123
31 1,954'
281,991
319,842
283.389
334.957
305,638
312,779
317,140
325.805
315,781
335,422
340,912
341,193
281,757
265,471
343,859
Securities received as pledge
20 Overnight and continuing
21 Term
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. Positions for calendar
days of the report week are assumed to be constant. Monthly averages are based on the
number of calendar days in the month.
2. Securities positions are reported at market value.
3. Net outright positions include immediate and forward positions. 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 for
mortgage-backed agency securities include securities purchased or sold that have been
delivered or are scheduled to be delivered in thirty business days or less.
Forward positions reflect agreements made in the over-the-counter market that specify
delayed delivery. Forward contracts for U.S. Treasury securities and federal agency debt
securities are included when the time to delivery is more than five business days. Forward
contracts for mortgage-backed agency securities are included when the time to delivery is
more than thirty business days.
4. Futures positions reflect standardized agreements arranged on an exchange. All futures
positions are included regardless of time to delivery.
5. 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. Financing
data are reported in terms of actual funds paid or received, including accrued interest.
6. 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 different types of collateralization.
NOTE, "n.a." indicates that data are not published because of insufficient activity.
Major changes in the report form filed by primary dealers induced a break in the dealer data
series as of the week ending July 6, 1994.
Federal Finance
1.44
FEDERAL A N D FEDERALLY S P O N S O R E D CREDIT AGENCIES
A33
Debt Outstanding
Millions of dollars, end of period
1995
Agency
1991
1992
1993
1994
May
1 Federal and federally sponsored agencies
7 Federal agencies
3
Defense Department1
4
Export-Import Bank""
5
Federal Housing Administration4
6
Government National Mortgage Association certificates of
participation'
/
Postal Service6
8
Tennessee Valley Authority
9
United States Railway Association6
10 Federally sponsored agencies7
11
Federal Home Loan Banks
12
Federal Home Loan Mortgage Corporation
13
Federal National Mortgage Association
14
Farm Credit Banks8
15
Student Loan Marketing Association 9
16
Financing Corporation1"
Farm Credit Financial Assistance Corporation"
17
18
Resolution Funding Corporation1"
June
July
Aug.
Sept.
442,772
483,970
570,711
738,928
771,524
785,982
788,323
801,819
811,182
41,035
7
9,809
397
41,829
7
7.208
374
45,193
6
5,315
255
39,186
6
3,455
116
38,720
6
3,156
78
38,412
6
2,652
81
39,403
6
2,652
84
39,581
6
2,652
83
38,030
6
2,512
87
n.a.
8,421
22,401
n.a.
n.a.
10,660
23,580
n.a.
n.a.
9,732
29,885
n.a.
n.a.
8,073
27,536
n.a.
n.a.
7,615
27,865
n.a.
n.a.
7,615
28,058
n.a.
n.a.
8,615
28,046
n.a.
n.a.
8,615
28.225
n.a.
n.a.
7,265
28,160
n.a.
401,737
107,543
30,262
133.937
52,199
38,319
8.170
1,261
29,996
442,141
114,733
29,631
166,300
51,910
39,650
8,170
1,261
29,996
523.452
139,512
49,993
201,112
53,123
39,784
8,170
1,261
29,996
699,742
205,817
93,279
257,230
53,175
50,335
8,170
1,261
29,996
732,804
218,131
107,686
263,023
54.054
49,993
8,170
1,261
29,996
747,570
223,089
108,484
270,937
53.915
51,268
8,170
1,261
29,996
748,920
223.100
111,427
268,458
54,635
51,325
8,170
1,261
29,996
762,238
228,299
112.341
275.271
54,979
51,323
8,170
1,261
29,996
773,152
236,851
11 1,610
277,192
55,800
51.672
8,170
1,261
29.996
185,576
154,994
128,187
103,817
92,739
90,638
88,892
86,776
84,297
9,803
8,201
4,820
10,725
n.a.
7,202
10,440
4,790
6,975
n.a.
5,309
9,732
4,760
6,325
n.a.
3,449
8,073
n.a.
3,200
n.a.
3,150
7,615
n.a.
3.200
n.a.
2,646
7,615
n.a.
3,200
n.a.
2,646
8,615
n.a.
3,200
n.a.
2,646
8,615
n.a.
3,200
n.a.
2,506
7,265
n.a.
3,200
n.a.
48,534
18,562
84,931
42,979
18,172
64,436
38,619
17,578
45,864
33,719
17,392
37,984
30,759
17,313
30,702
30,004
17,256
29,917
28,419
17,274
28,738
27,384
17,276
27,655
26,845
17,276
27,205
MEMO
19 Federal Financing Bank debt 1 3
20
21
22
23
24
Lending to federal and federally sponsored agencies
Export-Import Bank
Postal Service6
Student Loan Marketing Association
Tennessee Valley Authority
United States Railway Association
Other lending14
25 Farmers Home Administration
26 Rural Electrification Administration
27 Other
1. Consists of mortgages assumed by the Defense Department between 1957 and 1963
under family housing and homeowners assistance programs.
2. Includes participation certificates reclassified as debt beginning Oct. I, 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 Administralion.
6. Off-budget.
7. Includes outstanding noncontingent liabilities: notes, bonds, and debentures. Includes
Federal Agricultural Mortgage Corporation; therefore details do not sum to total. Some data
are estimated.
8. Excludes borrowing by the Farm Credit Financial Assistance Corporation, which is
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 (he 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 to
avoid double counting.
14. Includes FFB purchases of agency assets and guaranteed loans; the latter are loans
guaranteed by numerous agencies, with the amounts guaranteed by any one agency generally
being small. The Farmers Home Administration entry consists exclusively of agency assets,
whereas the Rural Electrification Administration entry consists of both agency assets and
guaranteed loans.
A34
1.45
DomesticNonfinancialStatistics • February 1996
NEW SECURITY ISSUES
Tax-Exempt State and Local Governments
Millions of dollars
1995
Type of issue or issuer,
or use
1992
1993
1994
Apr.
1
May
June
July
Aug.
Sept.
Oct.
Nov.
226,818
279,945
153,950
8,666 r
12,323r
17,230r
ll,575 r
12,450r
9,698 r
13,336 r
16,580
By type of issue
2 General obligation
3 Revenue
78,611
136,580
90,599
189,346
54,404
99,546
3,536
5,016
4,332
7,472
5,755
12,201
3,529
6,248
4,519
7,789
3,635
6,129
6,252
7,322
6,084
10,496
By type of issuer
4 State
5 Special district or statutory authority2
0 Municipality, county, or township
24,874
138,327
63,617
27,999
178,714
73,232
19,186
95,896
38,868
994
5,814
1,744
1,315
8,039
2,450
1,329
11,382
5,245
645
7,399
1,733
617
7,491
4,200
1,510
5,821
2,433
1,825
7,831
3,918
1,491
10,477
4,612
7 Issues for new capital
101,865
91,434
105,972
6,184 r
8,830 r
13,083r
8,740 r
6,685 r
6,339 r
7,828 r
11,439
18,852
14,357
12,164
16,744
6,188
33,560
16,831
9,167
12,014
13,837
6,862
32,723
21,267
10,836
10,192
20,289
8,161
35,227
1,863
615
345
1,547
391
1,736
2,594
606
1,282
1,738
416
1,770
2,494
3,127
1,235
2,062
411
4,467
1,924
1,926
485
1,333
500
2,216
1,180
869
1,504
1,421
201
1,967
1,929
446
563
1,228
627
2,050
1,725
631
1,794
1,587
203
2,114
3,250
1,452
756
2,253
404
3,324
1 AH issues, new and refunding
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. Includes school districts.
1.46
NEW SECURITY ISSUES
SOURCES. Securities Data
Dealer's Digest before then.
Company
beginning
January
1993;
Investment
U.S. Corporations
Millions of dollars
1995
Type of issue, offering,
or issuer
1992
1993
1994
Mar.
Apr.
r
May
r
June
r
Aug.
Sept.r
Oct.
r
July
r
1 All issues'
559,827
754,969
n.a.
40,101
47,601 r
56,217
49,729
2 Bonds 2
471,502
641,498
n.a.
37,178
26,909
48,579
48,585
29,208 r
41,363 r
49,000
41,500
By type of offering
3 Public, domestic
4 Private placement, domestic3
5 Sold abroad
378,058
65,853
27,591
486,879
116,240
38,379
365,050
n.a.
56,238
32,990
n.a.
4,188
22,756
n.a.
4,153
40,052
n.a.
8,528
42,398
n.a.
6,186
23,147
n.a.
6,06 r
32,351
n.a.
9,012r
43,000
n.a.
6,000
35,000
n.a.
6,500
82,058
43,111
9.979
48,055
15,394
272,904
88,002
60,293
10,756
56,272
31,950
394,226
31,981
27,900
4.573
11,713
11,986
333,135
2,174
1,978
403
959
411
31,254
2,876
1,815
800
331
336
20,752
2,139
6,085
955
2,530
1,767
35,103
6,330
4,528
657
2,661
1,745
32,664
4,456
1,078
10
498
1,520
21,646r
3,982
2,480
133
620
1,089
33,058r
4,580
2,182
908
1,819
2,787
36,724
3,022
3,240
187
2,444
2,807
30,300
12 Stocks"
88,325
113,472
n a-
2,923 r
3,878 r
6,210 r
7,748 r
4,588 r
6,238 r
7,217
8,229
Bv type of offering
13 Public preferred
14 Common
15 Private placement3
21,339
57,118
9,867
18.897
82,657
11,917
12.432
47.881
205
2,718r
n.a.
656
3,222r
n.a.
1,507
4,703r
n.a.
73 r
7,017r
n.a.
753
3,835r
n.a.
1,234
5,005r
n.a.
1,012
6,205
n.a.
807
7,422
n.a.
22,723
20,231
2,595
6,532
2,366
33,879
22,271
25,761
2,237
7,050
3,439
52,021
1,013r
907
60
137
20
786
634
2,152r
48
141
0
903
2,370r
1,134r
101
185
0
2,322
2,345r
2,747'
0
209
0
2,447r
1,306
l,968 r
0
133
64
1,117
2,254r
l,496 r
87r
91
0
2,304r
2,355
2,660
99
190
47
1,865
1,689
4,343
39
60
0
2,097
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
n.a.
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 closedend, intracorporate transactions, equities sold abroad, and Yankee bonds. Stock data include
ownership securities issued by limited partnerships.
30,787
54,789
56,333
33,796
2. Monthly data cover only public offerings.
3. Monthly data are not available.
SOURCES. Beginning July 1993, Securities Data Company and the Board of Governors of
the Federal Reserve System.
Securities
1.47
O P E N - E N D I N V E S T M E N T COMPANIES
Market and Corporate
Finance
A35
Net Sales and Assets'
Millions of dollars
1995
Item
1994
1993
Mar.
Apr.
June
May
Aug.
July
Sept.'
Oct.
1 Sales of own shares"
851,885
841,286
69,898
68,294
70,798
74,749
76,081
72,113
68,694
72,762
2 Redemptions of own shares
3 Net sales3
567,881
284,004
699,823
141,463
60,970
8.928
59.957
8,337
57,033
13,765
61,932
12,817
56,344
19,736
57.610
14,503
54.473
14,221
56,173
16,588
4 Assets4
1,510,209
1,550,490
1,657,370
1,710,280
1,769,287
1,808,753
1,880,754
1,908,525
1,962,817
1,963,344
5 Cash5
6 Other
100.209
1,409,838
121,296
1,429,195
121,424
1,535.946
124,092
1,586,187
128,375
1,640,913
122,461
1,686.292
126,340
1,754,415
127.173
1,781.352
127,446
1,835,371
134,034
1.829,310
1. Data on sales and redemptions exclude money market mutual funds but include
limited-maturity municipal bond funds. Data on asset positions exclude both money market
mutual funds and limited-maturity municipal bond funds.
2. Includes reinvestment of net income dividends. Excludes reinvestment of capital gains
distributions and share issue of conversions from one fund to another in the same group.
3. Excludes sales and redemptions resulting from transfers of shares into or out of money
market mutual funds within the same fund family.
1.48
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 newly formed companies after their
initial offering of securities.
CORPORATE PROFITS AND THEIR DISTRIBUTION
Billions of dollars; quarterly data at seasonally adjusted annual rates
1994
1993
Account
1992
1993
1995
1994
04
Ql
Q2
Q3
Q4
01
Q2
Q3
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
405.1
395.9
139.7
256.2
171.1
85.1
485.8
462.4
173.2
289.2
191.7
97.5
542.7
524.5
202.5
322.0
205.2
1 16.9
533.9
501.7
191.5
310.2
194.6
115.6
508.2
483.5
184.1
299.4
196.3
103.0
546.4
523.1
201.7
321.4
202.5
1 18.9
556.0
538.1
208.6
329.5
207.9
121.6
560.3
553.5
215.6
337.9
213.9
124.0
569.7
570.6
220.0
350.7
217.1
133.5
581.1
574.1
220.4
353.6
219.9
133.8
n.a.
n.a.
n.a.
n.a.
223.7
n.a.
7 Inventory valuation
8 Capital consumption adjustment
-6.4
15.7
-6.2
29.5
-19.5
37.7
-6.5
38.8
-12.3
37.0
-14.1
37.4
-19.6
37.5
-32.1
38.8
-39.0
38.1
-28.2
35.2
-7.4
35.4
SOURCE. U.S. Department of Commerce, Survey of Current Business.
A36
1.51
DomesticNonfinancialStatistics • February 1996
DOMESTIC FINANCE COMPANIES
Assets and Liabilities'
Billions of dollars, end of period; not seasonally adjusted
1994
Account
1992
1993
1995
1994
Ql
Q2
Q3
Q4
Ql
Q2
Q3
ASSETS
1 Accounts receivable, gross 2
2
Consumer
3
Business
4
Real estate
491.8
118.3
301.3
72.2
482.8
116.5
294.6
71.7
551.0
134.8
337.6
78.5
494.5
120.1
302.3
72.1
511.3
124.3
313.2
73.8
524.1
130.3
317.2
76.6
551.0
134.8
337.6
78.5
568.5
135.8
351.9
80.8
586.9
141.7
361.8
83.4
594.7 r
146.2
362.4 r
86.1
53.2
16.2
50.7
11.2
55.0
12.4
51.2
11.6
51.9
12.1
51.1
12.1
55.0
12.4
58.9
12.9
62.1
13.7
61.2
13.8
7 Accounts receivable, net
8 AH other
422.4
142.5
420.9
170.9
483.5
183.4
431.7
171.2
447.3
174.6
460.9
177.2
483.5
183.4
496.7
194.6
511.1
198.1
5l9.7 r
198.1
9 Total assets
564.9
591.8
666.9
602.9
621.9
638.1
666.9
691.4
709.2
717.8 r
37.6
156.4
25.3
159.2
21.2
184.6
24.2
165.9
23.3
171.2
21.6
171.0
21.2
184.6
21.0
181.3
21.5
181.3
21.8
178.0
39.5
196.3
68.0
67.1
42.7
206.0
87.1
71.4
51.0
235.0
99.5
75.7
41.1
211.7
90.5
69.5
44.7
219.6
89.9
73.2
50.0
228.2
95.0
72.3
51.0
235.0
99.5
75.7
52.5
254.4
102.5
79.7
57.5
264.4
102.1
82.5
59.0
272.1
101.7
84.4
564.9
591.8
666.9
602.9
621.9
638.1
666.9
691.4
709.2
717.1
5 LESS: Reserves for unearned income
6
Reserves for losses
LIABILITIES AND C A P I T A L
10 Bank loans
11 Commercial paper
12
13
14
15
Debt
Owed to parent
Not elsewhere classified
All other liabilities
Capital, surplus, and undivided profits
16 Total liabilities and capital
1. Includes finance company subsidiaries of bank holding companies but not of retailers
and banks. Data are amounts carried on the balance sheets of finance companies; securitized
pools are not shown, as they are not on the books.
1.52
DOMESTIC FINANCE COMPANIES
2. Before deduction for unearned income and losses,
Consumer, Real Estate, and Business Credit1
Millions of dollars, amounts outstanding, end of period
1995
May
June
July
Aug.
Sept.
Oct.
661,656
671,807 r
674,898 r
681,790
r
189,898
84,886
386,872
191,806
85,756
394,245 r
193,206r
86,121
395,57 l r
193,792
87,266
400,732
658,140
665,535 r
672,304 r
681,127
187,803
65,861
76,302
32,381
13,259
84,987
385,350
124,005
22,953
32,147
68,905
170,253
42,541
12,111
115,601
63,869
27,223
4,784
16,469
5,970
r
193,266r
68,857
77,345
31,693 r
15,371
86,128
392,910 r
I25,053 r
25,006
29,313
70,734 r
171,239
42,823
12,210
116,206
66,111
30,507 r
4,818 r
19,773r
5,916
194,102
70,816
77,865
30,096
15,325
87,471
399,554
129,207
25,743
32,209
71,255
172,657
43,697
11,581
117,379
66,238
31,452
4,586
20,390
6,476
Seasonally adjusted
1 Total
2 Consumer
3 Real estate 2
4
539,996
157,579
72,473
309,944
545,533
160,349
71,965
313,219
614,784
176,198
78,770
359,816
653,872
186,584
82,843
384,446
660,714
188,666
84,198
387,850
Not seasonally adjusted
5 Total
6 Consumer
/
Motor vehicles
8
Other consumer 1
9
Securitized motor vehicles 4
10
Securitized other consumer 4
11 Real estate 2
12
Motor vehicles
13
14
Retail5
15
Wholesale 6
16
Leasing
Equipment
17
18
Retail
19
Wholesale 6
20
Leasing
21
Other business 7
22
Securitized business assets 4
23
Retail
24
Wholesale
25
Leasing
544,691
159.558
57,259
61,020
29,734
11,545
72,243
312,890
89,011
20,541
29,890
38,580
151,424
33,521
8,680
109,223
60,856
11,599
1,120
5,756
4,723
550,751
162,770
56,057
60,396
36,024
10,293
71,727
316,254
95,173
18,091
31,148
45,934
145,452
35,513
8,001
101,938
53,997
21,632
2,869
10,584
8,179
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.
620,975
178,999
61,609
73,221
31,897
12,272
78,479
363,497
118,197
21,514
35,037
61,646
157,953
39,680
9,678
108,595
61,495
25,852
4,494
14,826
6,532
653,503
184,616
63,689
75,943
32,117
12,867
82,735
386,152
128,312
21,228
39,512
67,572
165,219
41,264
10,643
113,312
64,099
28,522
5,224
17,676
5,622
661,910
187,303
65,162
76.581
32,135
13,425
83,351
391,256
127,487
22,142
36,989
68,356
169,995
42.008
11,725
116,262
64,365
29,409
4,989
18,310
6,110
190,830
68,27 l r
77,251
31,551
13,757
86,107
388,598 r
124,444r
23,883 r
31,392
69,169
170,825
43,121
12,278
115,426
64,94 l r
28,388
4,587
17,986
5,815
4. Outstanding balances of pools upon which securities have been issued; these balances
are no longer carried on the balance sheets of the loan originator.
5. Passenger car fleets and commercial land vehicles for which licenses are required.
6. Credit arising from transactions between manufacturers and dealers, that is, floor plan
financing.
7. Includes loans on commercial accounts receivable, factored commercial accounts, and
receivable dealer capital; small loans used primarily for business or farm purposes; and
wholesale and lease paper for mobile homes, campers, and travel trailers.
Real Estate
1.53
MORTGAGE MARKETS
A37
Mortgages on New Homes
Millions of dollars except as noted
1995
Item
1992
1993
1994
May
June
July
Aug.
Sept.
Oct.
Nov.
178.6
136.4
78.9
27.7
1.22
Terms and yields in primary and secondary markets
PRIMARY MARKETS
1
2
3
4
5
Terms'
Purchase price (thousands of dollars)
Amount of loan (thousands of dollars)
Loan-to-price ratio (percent)
Maturity (years)
Fees and charges (percent of loan amount) 2
181.7
137.7
78.2
27.2
1.18
169.4
130.4
78.9
26.6
1.18
170.4
130.6
78.9
27.3
1.12
174.8
131.8
78.1
28.0
1.20
174.3
133.0
77.8
26.6
1.30
178.1
136.3
78.7
28.4
1.30
7.98
8.25
8.43
7.03
7.24
7.37
7.26
7.47
8.58
7.79
7.99
7.84
7.54
7.73
7.80
7.58
7.78
7.98
7.56
7.75
7.91
7.50
7.69
7.78
7.39
7.58
7 62
8.46
7.71
Yield (percent per year)
6 Contract rate 1
7 Effective rate 1 ' 3
8 Contract rate (HUD series) 4
170.4
130.8
78.8
27.5
1.29
7.46
6.65
8.68
7.96
8.03
7.53
8.00
7.24
8.09
7.27
8.03
7.49
8.03
7.26
7.61
7,16
n.a.
158.1
118.1
76.6
25.6
1.60
163.1
123.0
78.0
26.1
I.I 1
7.27
7.46
n.a.
SECONDARY MARKETS
Yield (percent per year)
9 FHA mortgages (Section 203) 5
10 GNMA securities 6
7.01
Activity in secondary markets
FEDERAL NATIONAL MORTGAGE ASSOCIATION
Mortgage holdings (end of period)
11 Total
1?
FHA/VA insured
13
Conventional
158,119
22,593
135,526
190,861
23,857
167,004
222,057
28,377
194,499
228,078
28,576
200,004
232,534
28,886
204,022
235,882
28,761
207,227
238,850
28.640
210,063
241.378
28.515
212.652
246.234
28.442
21 7 . 4 6 9
249.928
28,424
221,027
14 Mortgage transactions purchased (during period)
75,905
92,037
62,389
3,787
6,575
5,657
5,688
5.002
7.443
6,148
Mortgage commitments
15 Issued 7
8
16 To sell
74,970
10,493
92,537
5,097
54,038
1,820
6,085
28
5,605
9
4,512
26
6,284
53
6.019
9
6,732
0
6,038
33,665
352
33,313
55,012
321
54,691
72,693
276
72,416
81,008
257
80,751
85,532
253
85,278
88,874
250
88,624
91.544
246
91.298
94.989
281
94,708
99.758
276
99,482
102.997
271
102.726
191,125
179,208
229,242
208,723
124,697
117,110
10,982
10,479
7,001
5,326
7,316
6,074
9,594
8,161
11,458
10.239
1 1.092
9,856
9,989
9,011
261,637
274,599
136,067
4.549
6,198
8.106
10.578
12.469
10,388
1 1,339
(during
period)
10
FEDERAL HOME LOAN MORTGAGE CORPORATION
Mortgage
17 Total
18
19
holdings (end of
periodf
F H A / V A insured
Conventional
Mortgage transactions
20 Purchases
21 Sales
(during
period)
22 Mortgage commitments contracted (during period) 9
1. Weighted averages based on sample surveys of mortgages originated by major institutional lender groups for purchase of newly built homes; compiled by the Federal Housing
Finance Board in cooperation with the Federal Deposit Insurance Corporation.
2. Includes all fees, commissions, discounts, and "points" paid (by the borrower or the
seller) to obtain a loan.
3. Average effective interest rate on loans closed for purchase of newly built homes,
assuming prepayment at the end of ten years.
4. Average contract rate on new commitments for conventional first mortgages; from U.S.
Department of Housing and Urban Development (HUD). Based on transactions on the first
day of the subsequent month.
5. Average gross yield on thirty-year, minimum-downpayment first mortgages insured
by the Federal Housing Administration (FHA) for immediate delivery in the private
secondary market. Based on transactions on first day of subsequent month.
6. Average net yields to investors on fully modified pass-through securities backed by
mortgages and guaranteed by the Government National Mortgage Association (GNMA),
assuming prepayment in twelve years on pools of thirty-year mortgages insured by the
Federal Housing Administration or guaranteed by the Department of Veterans Affairs.
7. Does not include standby commitments issued, but includes standby commitments
converted.
8. Includes participation loans as well as whole loans
9. Includes conventional and government-underwritten loans. The Federal Home Loan
Mortgage Corporation's mortgage commitments and mortgage transactions include activity
under mortgage securities swap programs, whereas the corresponding data for FNMA
exclude swap activity.
A38
1.54
Domestic Financial Statistics • February 1996
MORTGAGE DEBT OUTSTANDING 1
Millions of dolors, end of period
1994
Type of holder and property
1991
1992
1995
1993
Q2
1
All holders
By type of property
2 One- to tour-family residences
3 Multifamily residences
4 Commercial
5
By type of holder
6 Major financial institutions
/
Commercial banks"
8
One- to tour-family
9
Multifamily
Commercial
10
11
Farm
12
Savings institutions 3
One- to four-family
13
14
Multifamily
15
Commercial
lb
Farm
1 / Lite insurance companies
18
One- to tour-family
Multifamily
19
20
Commercial
21
Farm
22 Federal and related agencies
23
Government National Mortgage Association
24
One- to tour-family
23
Multifamilv
26
Fanners Home Administration 4
27
One- to four-family
Multifamily
28
29
Commercial
Farm
30
Federal Housing and Veterans' Administrations
31
32
One- to four-tamily
Multifamily
33
Resolution Trust Corporation
34
33
One- to four-tamily
36
Multifamily
3/
Commercial
38
Farm
39
Federal Deposit Insurance Corporation
40
One- to tour-family
41
Multifamily
42
Commercial
43
Farm
44
Federal National Mortgage Association
45
One- to four-family
Multifamily
46
4/
Federal Land Banks
48
One- to four-tamily
49
Farm
50
Federal Home Loan Mortgage Corporation
51
One- to four-family
52
Multifamily
53 Mortgage pools or trusts 5
54
Government National Mortgage Association
35
One- to four-family
36
Multifamily
3/
Federal Home Loan Mortgage Corporation
38
One- to four-tamily
Multifamily
39
60
Federal National Mortgage Association
61
One- to four-family
Multifamily
62
Farmers Home Administration 4
63
64
One- to four-family
Multifamily
63
66
Commercial
Farm
67
68
Private mortgage conduits
69
One- to four-tamily
Multifamily
/O
/I
Commercial
72
Farm
73 Individuals and others 6
/4
One- to tour-family
/3
Multifamily
Commercial
/6
//
Farm
Q4
Ql
Q2 P
3,926,337
4,056,233
4,229,592
4,315,839
4,375,155
4,426,606
4,474,715
4,527,103
2,781,327
306.551
759,154
79,305
2,963,391
295,417
716,687
80,738
3,149,634
291,985
706,780
81,194
3,235,939
295,013
702,821
82,066
3,292,201
297,650
702,679
82,625
3,344,791
296,902
701,941
82,971
3,383,139
298,230
709,942
83,404
3,431,841
300,629
710,266
84,367
1.846.726
876.100
483,623
36,935
337,095
18,447
705,367
538,358
79,881
86,741
388
265,258
11,547
29,562
214,105
10,044
1,769,187
894,513
507,780
38,024
328,826
19,882
627,972
489,622
69,791
68,235
324
246,702
1 1,441
27,770
198,269
9,222
1,767,835
940,444
556,538
38,635
324,409
20,862
598,330
469,959
67,362
60,704
305
229,061
9,458
25,814
184,305
9,484
1,763,227
956,840
569,512
38,609
326,800
21,918
585,671
462,219
66,281
56,872
299
220,716
8,122
24,958
178,194
9,442
1,786,074
981,365
592,021
38,004
328,931
22,408
587,545
466,704
65,532
55,017
291
217,165
7,984
24,534
175,168
9,479
1,815,810
1,004,280
611,697
38,916
331,100
22.567
596,198
477,499
64,400
54,011
289
215,332
7,910
24,306
173,539
9,577
1,841,815
1,024,854
625,378
39,746
336,795
22,936
601,777
483,625
63,778
54,085
288
215,184
7,892
24,250
173,142
9,900
1,865,145
1,052,882
648,815
40,519
339,983
23,564
598,876
481.434
64,373
52,788
281
213,387
7,817
24,019
171,493
10,058
266,146
19
19
0
41.713
18,496
10,141
4,905
8,171
10,733
4,036
6.697
45.822
14.535
15,018
16.269
0
0
0
0
0
0
1 12.283
100.387
1 1,896
28,767
1.693
27,074
26,809
24.125
2,684
286.263
30
30
0
41,695
16,912
10,575
5,158
9.050
12,581
5,153
7,428
32,045
12,960
9,621
9,464
0
0
0
0
0
0
137,584
124,016
13,568
28,664
1,687
26,977
33,665
31,032
2,633
328,598
22
15
7
41,386
15,303
10,940
5,406
9,739
12,215
5,364
6,85 1
17,284
7,203
5,327
4.754
0
14,112
2,367
1,426
10,319
0
166,642
151,310
15,332
28,460
1.675
26,785
48.476
45,929
2,547
329,725
12
12
0
41,370
14,459
11.147
5,526
10.239
11,169
4,826
6,343
13,908
6.045
4,230
3,633
0
11,407
1,706
1,701
8,000
0
175.377
159,437
15,940
28,475
1,675
26,800
48,007
45,427
2,580
329,304
12
12
0
41,587
14,084
11,243
5,608
10,652
10,533
4,321
6,212
15,403
6,998
4,569
3,836
0
9,169
1,241
2,090
5,838
0
177,200
161,255
15,945
28,538
1,679
26,859
46,863
44,208
2,655
373,491
6
6
0
41,781
13,826
11,319
5,670
10,966
10,964
4,753
6,211
10,428
5,200
2,859
2,369
0
7,821
1.049
1,595
5,177
0
178,059
162,160
15,899
28,555
1,671
26,885
45.876
43,046
2,830
319,770
15
15
0
41,857
13,507
11,418
5,807
11.124
10,890
4,715
6,175
9,342
4,755
2,494
2,092
0
6,730
840
1,310
4,580
0
177,615
161,780
15,835
28,065
1,651
26,414
45,256
42,122
3,134
1.250,666
425,295
415.767
9,528
359,163
351.906
7.257
371,984
362,667
9.317
47
1 1
0
19
17
94,177
84,000
3.698
6,479
0
1.425,546
419,516
410,675
8.841
407,514
401,525
5,989
444,979
435,979
9.000
38
8
0
17
13
153,499
132,000
6.305
15.194
0
1,553,818
414,066
404,864
9,202
446,029
441,494
4,535
495,525
486,804
8,721
28
5
0
13
10
198.171
164,000
8.701
25,469
0
1,652,999
435,709
426,363
9,346
479,555
475,733
3.822
514,855
505.730
9,125
72
4
0
10
8
222,858
179,500
1 1,514
31.844
0
1,682,421
444.976
435,511
9,465
482,987
479,539
3,448
523,512
514,375
9,137
20
4
0
9
7
230,926
182,300
13,891
34,735
0
1,703,076
450,934
441,198
9,736
486.480
483,354
3,126
530,343
520,763
9,580
19
3
0
9
7
235,300
183,600
14,925
36,774
0
1,714,357
454,401
444,632
9,769
488,723
485,643
3,080
533,262
523,903
9,359
14
2
0
7
5
237,957
184,400
15,743
37,814
0
1,737,483
457,101
446,855
10,246
496,139
493,105
3,034
543,669
533,091
10,578
13
2
0
6
5
240,561
187,000
15,745
37,816
0
575.237
382.572
85,871
91,524
15,270
579,341
387,345
86,586
91,401
14,009
577,356
379.964
90,924
93,538
12,929
584,229
387,057
91,201
93,292
12,681
598,772
398,279
92,137
95,620
12,736
609,264
406,770
93,218
96,413
12,863
562,798
370,157
83,937
93.541
15,164
1. Multifamily debt refers to loans on structures of five or more units.
2. Includes loans held by nondeposit trust companies but not loans held by bank trust
departments.
3. Includes savings banks and savings and loan associations.
4. FmHA-guaranteed securities sold to the Federal Financing Bank were reallocated from
FmHA mortgage pools to FmHA mortgage holdings in I986:Q4 because of accounting
changes by the Farmers Home Administration.
5. Outstanding principal balances of mortgage-backed securities insured or guaranteed by
the agency indicated.
Q3
569,887
375,167
89,417
91,943
13,360
315,211
10
10
0
41,917
13,217
1 1,512
5,949
11,239
10,098
4,838
5,260
6,456
2,870
1,940
1,645
0
6,039
731
1,135
4,173
0
178,462
162,674
15,788
28,005
1,648
26,357
44,224
40,963
3,261
6. Other holders include mortgage companies, real estate investment trusts, state and local
credit agencies, state and local retirement funds, noninsured pension funds, credit unions, and
finance companies.
SOURCE. Based on data from various institutional and government sources. Separation of
nonfarm mortgage debt by type of property, if not reported directly, and interpolations and
extrapolations, when required for some quarters, are estimated in part by the Federal Reserve.
Line 69 from Inside Mortgage Securities.
Consumer Installment Credit
A39
CONSUMER INSTALLMENT CREDIT 1
1.55
Millions of dollars, amounts outstanding, end of period
1995'
Holder and type of credit
1992
1994
1993
July
June
May
Aug.
Sept.
Oct.
Seasonally adjusted
1 Total
730,847
790,351
902,853
959,117
970,608
979,375
989,695
993,843
1,004,393
2 Automobile
3 Revolving
4 Other 2
257,436
258,081
215,331
280,566
286,588
223,197
317,237
334,511
251,106
327,993
366,094
265,030
330,709
372,350
267,549
337,127
375,272
266,976
339,770
379,669
270,255
341,155
382,094
270,595
344,749
387,187
272,457
Not seasonally adjusted
748,057
809,440
925,000
950,620
964,256
971,965
990,428
996,525
1,004,639
By major holder
Commercial banks
Finance companies
Credit unions
Savings institutions
Nonfinancial business 3
Pools of securitized assets 4
330,088
118,279
91,694
37,049
49,561
121,386
367,566
116,453
101,634
37,855
55,296
130,636
427,851
134,830
119,594
38,468
60,957
143,300
434,863
139,632
123,975
38,101
55,914
158,135
437,498
141,743
125,313
38,400
56,349
164,953
441,165
142,163
126,500
38,907
56,360
166,870
451,784
145,522
128,424
38,634
55,723
170,341
449,502
146.202
129,027
38,894
54,177
178,723
451,232
148,681
130,304
38,500
54,607
181,315
By major type of credit
12 Automobile
Commercial banks
13
14
Finance companies
Pools of securitized assets 4
15
258,226
109,623
57,259
33,888
281,458
122,000
56,057
39,481
318,213
141,851
61,609
34,918
326,546
142,865
63,689
36,244
330,739
144,761
65,162
36,690
336,154
146,149
65,861
37,071
341,716
148,549
68,271
36,681
344,401
148,901
68,857
37,476
347,591
150,782
70,816
36,453
16 Revolving
17
Commercial banks
18
Nonfinancial business 3
Pools of securitized assets 4
19
271,850
132,966
44,466
74,921
301,837
149,920
50,125
79,878
352,266
180,183
55,341
94,376
361,273
183,006
50,595
106,811
367,602
182,950
51,006
112,609
370,520
184,245
50,520
114,338
377,784
189.163
48,976
117,729
380,341
185,572
48,968
123,749
384,632
186,463
49,358
126,739
20 Other
21
Commercial banks
22
Finance companies
Nonfinancial business 3
23
Pools of securitized assets 4
24
217,981
87,499
61,020
5,095
12,577
226,145
95,646
60,396
5,171
11,277
254,521
105,817
73,221
5,616
14,006
262,801
108,992
75,943
5,319
15,080
265,881
109,787
76,581
5,309
15,654
264,734
110,771
76,302
5,283
15,461
269,467
114,072
77,251
5,286
15,931
271,845
115,029
77,345
5,271
17,498
272,416
113,987
77,865
5,249
18,123
5 Total
6
7
8
9
10
11
1. The Board's series on amounts of credit covers most short- and intermediate-term credit
extended to individuals that is scheduled to be repaid (or has the option of repayment) in two
or more installments. Data in this table also appear in the Board's G.19 (421) monthly
statistical release. For ordering address, see inside front cover.
2. Comprises mobile home loans and all other installment loans that are not included in
automobile or revolving credit, such as loans for education, boats, trailers, or vacations. These
loans may be secured or unsecured.
1.56
3. Includes retailers and gasoline companies.
4. Outstanding balances of pools upon which securities have been issued; these balances
are no longer carried on the balance sheets of the loan originator.
5. Totals include estimates for certain holders for which only consumer credit totals are
available.
TERMS OF CONSUMER INSTALLMENT CREDIT'
Percent per year except as noted
1995
Item
1992
1993
1994
Apr.
May
June
July
Aug.
Sept.
Oct.
INTEREST R A T E S
Commercial banks'
1 48-month new car
2 24-month personal
9.29
14.04
8.09
13.47
8.12
13.19
n.a.
n.a.
9.78
14.03
n.a.
n.a.
n.a.
n.a.
9.44
13.84
n.a.
n.a.
n.a.
n.a.
Credit card plan
3 All accounts
4 Accounts assessed interest
n.a.
n.a.
n.a.
n.a.
15.69
15.77
n.a.
n.a.
16.15
16.23
n.a.
n.a.
n.a.
n.a.
15.98
15.94
n.a.
n.a.
n.a.
n.a.
Auto finance
5 New car
6 Used car
9.93
13.80
9.48
12.79
9.79
13.49
11.74
14.99
11.43
14.78
11.08
14.63
11.01
14.35
10.85
14.23
10.75
14.12
10.89
14.06
54.0
47.9
54.5
48.8
54.0
50.2
54.6
52.2
54.4
52.2
53.9
52.3
54.1
52.4
53.5
52.3
53.4
52.3
54.6
52.3
89
97
91
98
92
99
92
100
92
99
92
99
92
100
92
99
92
100
92
99
13,584
9,119
14,332
9,875
15,375
10,709
16,029
11,505
16,155
11,396
16,083
11,518
16,086
11,637
16,056
11,662
16,402
11,725
16,430
11,883
companies
OTHER T E R M S 3
Maturity (months)
7 New car
8 Used car
Loan-to-value
9 New car
10 Used car
ratio
Amount financed (dollars)
11 New car
12 Used car
1. The Board's series on amounts of credit covers most short- and intermediate-term credit
extended to individuals that is scheduled to be repaid (or has the option of repayment) in two
or more installments. Data in this table also appear in the Board's G.I9 (421) monthly
statistical release. For ordering address, see inside front cover.
2. Data are available for only the second month of each quarter,
3. At auto finance companies,
A40
1.57
DomesticNonfinancialStatistics • February 1996
FUNDS RAISED IN U.S. CREDIT MARKETS'
Billions of dollars; quarterly data at seasonally adjusted annual rates
1994
1993
Q4
Ql
1995
Q2
Q3
Q4
Ql
Q2
Nonfinancial sectors
1 Total net borrowing by domestic nonfinancial s e c t o r s . . . .
635.3
478.7
540.6
618.5
602.4
660.0
650.3
527.8
607.6
623.9
842.4
819.6
BY sector and instrument
2 U.S. government
3
Treasury securities
4
Budget agency issues and mortgages
246.9
238.7
8.2
278.2
292.0
-13.8
304.0
303.8
.2
256.1
248.3
7.8
155.9
155.7
.2
274.2
266.5
7.7
210.5
211.8
-1.3
122.9
118.2
4.7
133.6
130.7
2.9
156.4
162.1
-5.7
271.8
273.0
-1.2
193.6
192.0
1.6
5 Private
388.4
200.4
236.7
362.4
446.6
385.8
439.7
404.9
474.0
467.5
570.6
626.0
6
7
8
9
10
11
12
13
14
15
16
BY instrument
Tax-exempt obligations
Corporate bonds
Mortgages
Home mortgages
Multifamily residential
Commercial
Farm
Consumer credit
Bank loans n.e.c
Commercial paper
Other loans
48.7
47.1
199.5
185.6
4.8
9.3
-.3
15.6
.4
9.7
67.5
68.7
78.8
161.4
163.8
-3.1
.4
.4
-14.8
-40.9
-18.4
-34.4
31.1
67.6
123.9
179.5
-11.2
-45.5
I.I
7.3
-13.8
8.6
11.9
75.5
75.2
155.7
183.9
-6.0
-22.6
.5
58.9
4.8
10.0
-17.7
-29.9
22.0
187.2
195.2
1.7
-11.4
1.8
121.2
71.4
21.4
53.2
27.3
67.4
148.5
184.6
-2.3
-33.9
.2
110.1
26.9
3.8
1.8
13.1
35.4
166.4
194.7
.4
-29.3
.6
68.7
69.1
8.2
78.9
-28.4
35.9
170.3
164.4
4.4
-1.4
2.9
122.8
53.6
16.4
34.3
-46.4
14.2
221.0
220.8
6.6
-8.6
2.2
131.6
89.5
33.8
30.2
-57.9
2.7
191.3
200.7
-4.6
-6.2
1.4
161.5
73.6
27.2
69.2
-57.4
41.4
241.1
207.2
3.6
28.6
1.7
100.3
139.8
1.1
104.3
-20.3
119.5
163.2
153.3
8.0
-1.9
3.9
147.9
102.2
44.8
68.6
17
18
19
20
21
22
By borrowing sector
Household
Nontinancial business
Farm
Nonfarm noncorporate
Corporate
State and local government
218.5
123.9
2.3
10.1
111.4
46.0
171.1
-33.3
2.1
-27.9
-7.4
62.6
214.2
.8
1.0
-43.5
43.2
21.7
280.9
18.5
2.0
-24.6
41.1
63.0
353.5
137.1
2.8
15.5
118.8
-44.0
335.0
33.8
3.6
-15.3
45.5
17.0
307.4
135.2
2.9
11.8
120.6
-2.9
308.0
144.2
8.7
12.7
122.7
-47.2
392.1
135.2
2.2
18.1
115.0
-53.4
406.4
133.8
-2.4
19.2
117.0
-72.6
324.4
302.4
.6
71.8
230.0
-56.2
324.7
328.8
6.8
32.0
289.9
-27.5
23 Foreign net borrowing in United States
24
Bonds
25
Bank loans n.e.c
26
Commercial paper
27
U.S. government and other loans
23.9
21.4
-2.9
12.3
-7.0
14.8
15.0
3.1
6.4
-9.8
22.6
15.7
2.3
5.2
-.6
68.8
81.3
.7
-9.0
-4.2
-20.3
7.1
1.4
-27.3
-1.6
41.8
60.1
-6.3
-12.0
.0
-98.0
-2.6
6.0
-101.8
.5
-37.0
-17.4
-4.5
-5.2
-9.9
20.6
20.8
4.7
-8.1
3.3
32.9
27.7
-.5
5.9
-.2
64.3
13.5
8.1
37.9
4.9
36.0
46.7
5.6
-9.6
-6.7
28 Total domestic plus foreign
659.2
493.4
563.3
687.3
582.1
701.8
552.3
490.9
628.2
656.8
906.7
855.6
Financial sectors
29 Total net borrowing by financial sectors
202.6
151.7
239.2
289.5
456.3
364.3
520.6
370.8
412.1
521.9
315.3
381.7
167.4
17.1
150.3
-.1
145.7
9.2
136.6
.0
155.8
40.3
1 15.6
.0
164.2
80.6
83.6
.0
284.3
176.9
112.1
-4.8
143.3
53.4
89.9
.0
336.8
160.0
196.0
- 19.2
254.7
146.6
108.1
.0
243.1
152.1
91.0
.0
302.4
249.0
53.4
.0
125.4
62.9
62.5
.0
186.1
127.2
59.0
.0
34 Private
35
Corporate bonds
36
Mortgages
37
Bank loans n.e.c
38
Open market paper
39
Loans from Federal Home Loan Banks
35.3
46.0
.6
4.7
8.6
-24.7
6.0
66.8
.5
8.8
-32.0
-38.0
83.4
80.5
.6
2.2
-.7
.8
125.3
1 18.6
3.6
-14.0
-6.2
23.3
172.1
1 10.2
9.8
-12.3
41.6
22.8
221.0
140.8
5.5
-18.0
76.0
16.8
183.8
158.1
9.8
-9.9
36.6
- 10.8
116.1
95.4
12.4
-27.7
3.6
32.3
169.0
95.9
12.0
-11.9
42.3
30.7
219.5
91.2
4.9
.5
84.0
38.8
189.9
150.3
5.1
17.8
40.3
-23.6
195.6
145.3
4.8
10.1
33.3
2.2
BY borrowing sector
40 Government-sponsored enterprises
41 Federally related mortgage pools
42 Private
43
Commercial banks
44
Bank holding companies
45
Funding corporations
46
Savings institutions
47
Credit unions
48
Life insurance companies
49
Finance companies
50
Mortgage companies
51
Real estate investment trusts (REITs)
52
Brokers and dealers
53
Issuers of asset-backed securities (ABSs)
17.0
150.3
35.3
-.7
-27.7
15.4
-30.2
.0
.0
23.8
.0
.8
1.5
52.3
9.1
136.6
6.0
- 1 1.7
-2.5
-6.5
-44.5
.0
.0
17.7
-2.4
1.2
3.7
51.0
40.2
115.6
83.4
8.8
2.3
13.2
-6.7
.0
.0
-1.6
8.0
.3
2.7
56.3
80.6
83.6
125.3
5.6
8.8
2.9
1 I.I
.2
.2
.2
-1.0
3.4
12.0
81.8
172.1
112.1
172.1
10.0
10.3
24.2
12.8
.2
.3
50.2
- 1 1.5
13.7
.5
61.2
53.4
89.9
221.0
1.2
12.2
36.7
8.8
.1
.4
16.3
-10.4
6.1
29.3
120.3
140.8
196.0
183.8
2.0
3.5
48.8
-5.6
.1
.0
63.3
-21.6
14.5
-9.9
88.7
146.6
108.1
116.1
12.4
10.1
-17.2
5.8
.2
.0
67.0
-18.2
15.3
.3
40.5
152.1
91.0
169.0
22.8
11.5
47.2
14.8
.5
.0
16.9
-7.0
18.8
-7.6
51.1
249.0
53.4
219.5
2.9
16.0
17.9
36.1
.2
1.3
53.7
1.0
6.3
19.3
64.7
62.9
62.5
189.9
9.3
13.4
62.3
-19.2
-.3
.0
82.5
8.2
6.9
-29.5
56.3
127.2
59.0
195.6
18.4
20.3
10.4
-6.9
-.1
.1
61.1
1.2
6.4
-.1
84.7
30
31
32
33
BY instrument
U.S. government-related
Government-sponsored enterprises securities
Mortgage pool securities
Loans from U.S. government
Flow of Funds
1.57
A41
F U N D S RAISED IN U.S. CREDIT MARKETS'—Continued
1994
1993
Transaction category or sector
1990
1991
1992
1993
1995
1994
Q4
Ql
Q2
Q3
Q4
Ql
Q2
All sectors
54 Total net borrowing, all sectors
861.8
645.2
802.5
976.8
1,038.4
1,066.1
1,072.9
861.7
1,040.3
1,178.7
1,222.0
1,237.3
55
56
57
58
59
60
61
62
414.4
48.7
114.5
200.1
15.6
2.2
30.7
35.8
424.0
68.7
160.6
161.9
-14.8
-29.1
-44.0
-82.2
459.8
31.1
163.8
124.5
7.3
-9.4
13.1
12.1
420.3
75.5
275.1
159.2
58.9
-8.5
-5.1
1.3
444.9
-29.9
139.3
197.0
121.2
60.6
35.7
69.6
417.5
27.3
268.3
154.0
110.1
2.6
67.7
18.6
566.5
13.1
190.9
176.2
68.7
65.1
-57.0
49.4
377.6
-28.4
113.8
182.7
122.8
21.4
14.8
56.8
376.7
-46.4
130.9
233.0
131.6
82.2
68.0
64.3
458.8
-57.9
121.7
196.2
161.5
73.6
117.1
107.8
397.2
-57.4
205.1
246.2
100.3
165.6
79.3
85.6
379.8
-20.3
311.5
168.0
147.9
117.9
68.5
64.1
U.S. government securities
Tax-exempt securities
Corporate and foreign bonds
Mortgages
Consumer credit
Bank loans n.e.c
Open market paper
Other loans
Funds raised through mutual funds and corporate equities
63 Total net share issues
64 Mutual funds
65 Corporate equities
66
Nonfinancial corporations
67
Financial corporations
68
Foreign shares purchased in United States
19.7
215.4
296.0
440.1
162.1
429.5
343.7
207.9
159.6
-62.9
49.6
146.6
65.3
-45.6
-63.0
10.0
7.4
151.5
64.0
18.3
15.1
30.7
211.9
84.1
27.0
26.4
30.7
320.0
120.1
21.3
38.3
60.5
138.3
23.7
-44.9
26.0
42.7
287.7
141.8
21.5
41.0
79.3
236.4
107.3
-9.6
48.4
68.5
144.0
63.9
-2.0
20.0
45.9
165.4
-5.7
-50.0
21.2
23.1
7.6
-70.5
-118.0
14.3
33.2
104.5
-54.9
-68.4
.7
12.8
178.5
-31.9
-73.2
5.6
35.7
I. Data in this table also appear in the Board's Z. I (780) quarterly statistical release, tables
F.2 through F.5. For ordering address, see inside front cover.
A42
1.58
DomesticNonfinancialStatistics • February 1996
S U M M A R Y OF FINANCIAL TRANSACTIONS 1
Billions of dollars except as noted; quarterly data at seasonally adjusted annual rates
1993
Transaction category or sector
1990
1991
1992
1993
1994
1995
1994
Q4
Ql
Q3
Q2
Q4
Ql
Q2
N E T LENDING IN C R E D I T M A R K E T S 2
1 Total net lending in credit markets
2
i
4
5
6
/
8
Y
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
Private domestic nonfinancial sectors
Households
Nonfarm noncorporate business
Nonfinancial corporate business
State and local governments
U.S. government
Foreign
Financial sectors
Government sponsored enterprises
Federally related mortgage pools
Monetary authority
Commercial banking
U.S. commercial banks
Foreign banking offices
Bank holding companies
Banks in U.S. affiliated areas
Funding corporations
Thrift institutions
Life insurance companies
Other insurance companies
Private pension funds
State and local government retirement funds
Finance companies
Mortgage companies
Mutual funds
Closed-end funds
Money market funds
Real estate investment trusts (REITs)
Brokers and dealers
Asset-backed securities issuers (ABSs)
Bank personal trusts
861.8
645.2
802.5
976.8
1,038.4
1,066.1
1,072.9
861.7
1,040.3
1,178.7
1,222.0
1,237.3
189.9
157.0
-1.7
-3.7
38.3
33.7
85.5
552.7
13.9
150.3
8.1
125.1
94.9
28.4
-2.8
4.5
16.1
-154.0
94.4
26.5
17.2
34.9
28.8
.0
41.4
.2
80.9
-.7
2.8
51.1
15.9
-7.4
-39.6
-3.7
6.7
29.2
10.5
26.6
615.4
15.2
136.6
31.1
80.8
35.7
48.5
-1.5
-1.9
15.8
-123.5
83.2
32.6
85.7
46.0
-9.8
11.2
90.3
14.7
30.1
-.7
17.5
48.9
10.0
75.9
74.2
-1.1
29.6
-26.8
-11.9
101.2
637.3
69.0
115.6
27.9
95.3
69.5
16.5
5.6
3.7
23.5
-61.3
79.1
12.8
37.3
34.4
5.0
234.9
317.4
-2.0
24.1
-104.6
-24.2
132.1
695.6
123.3
1 12.1
31.5
162.0
148.1
11.2
.9
1.9
13.8
34.9
58.1
21.1
-42.4
60.8
68.2
-22.9
7.6
3.5
28.5
4.7
-34.0
57.8
7.1
104.4
196.7
-3.5
12.2
-101.0
-7.7
204.2
765.2
71.2
89.9
38.5
188.1
197.3
-6.5
-4.8
2.1
42.6
-13.3
86.4
32.1
-60.1
36.9
22.6
-13.3
138.9
7.7
56.9
.2
-82.8
113.7
8.9
288.8
337.0
-3.6
19.9
-64.4
-46.5
123.9
706.7
92.4
196.0
48.8
184.7
120.6
59.0
3.1
2.1
19.5
13.6
47.6
27.9
-97.7
72.9
72.1
-43.5
61.7
8.3
-45.0
6.6
-55.7
87.9
8.9
270.4
385.9
-1.8
12.2
-125.9
64.3
543.2
101.1
108.1
17.9
109.1
128.4
-21.5
.2
1.9
33.5
42.6
6.4
20.8
-30.7
69.3
49.8
-36.3
9.4
3.2
32.2
6.6
-52.6
42.8
10.2
141.9
186.2
-1.9
25.1
-67.6
-9.3
132.2
775.6
125.6
91.0
24.0
191.1
164.4
22.1
2.7
1.9
25.1
52.8
80.5
16.0
-17.6
26.3
58.9
-14.0
24.2
1.4
50.0
5.5
-19.3
46.3
7.7
238.5
360.3
-.5
39.2
-160.5
-24.7
208.1
756.8
174.3
53.4
35.4
163.3
178.9
-15.0
-2.4
-6.9
53.8
8.0
15.8
3.1
-3.2
14.5
1.5
-18.4
121.7
857.7
90.2
83.6
36.2
142.2
149.6
-9.8
.0
2.4
18.1
-1.7
105.1
33.3
40.2
25.5
-9.0
.0
169.6
10.2
14.6
.6
9.2
80.5
9.5
-23.0
30.5
98.1
19.7
-23.6
74.6
91.8
2.1
-64.8
1.0
76.7
.2
-8.6
54.3
1.4
-33.8
148.3
.9
6.2
-189.2
-13.0
260.1
1,008.8
12.2
62.5
24.8
359.6
177.5
182.3
-1.9
1.7
22.3
29.4
109.9
13.0
97.6
64.5
95.7
16.5
-10.1
.8
25.5
2.5
30.7
49.8
1.6
-238.2
-157.1
.9
26.6
-108.6
-25.7
340.8
1,160.5
86.7
59.0
12.6
292.8
212.6
75.4
3.2
1.7
-36.6
5.4
91.1
14.9
138.9
65.7
56.1
2.3
25.2
1.1
138.2
3.1
124.2
78.3
1.8
861.8
645.2
802.5
976.8
1,038.4
1,066.1
1,072.9
861.7
1,040.3
1,178.7
1,222.0
1,237.3
2.0
1.5
1.0
25.7
165.1
35.0
43.6
63.7
-1.6
-2.0
.2
27.3
249.7
43.5
113.5
-57.2
-73.2
3.9
35.5
-7.2
211.9
84.1
4.2
41.1
8.5
18.3
-7.1
270.2
.8
.0
.4
35.2
309.2
50.9
117.3
-70.3
-23.5
19.2
65.5
-11.7
320.0
120.1
61.9
50.0
4.6
-11.7
1.6
315.6
-5.8
.0
.7
70.3
-24.2
38.2
65.3
-45.6
3.5
37.0
-4.8
-27.1
29.7
139.0
—5.9
.0
.0
25.7
360.3
-3.4
86.3
1.5
-58.5
41.2
-16.5
-16.7
151.5
64.0
51.4
3.8
-6.2
-4.2
16.1
203.4
103.6
85.5
-10.1
-40.5
19.0
45.4
84.3
30.1
138.3
23.7
-2.3
93.4
3.0
-30.0
18.8
269.6
2.2
.0
.7
35.5
251.6
4.7
81.9
-36.6
13.7
61.1
-14.4
32.8
287.7
141.8
86.5
54.4
4.9
-27.5
17.6
389.9
-.2
.0
.7
20.0
6.8
173.0
173.1
2.5
-39.6
-35.1
23.0
16.0
236.4
107.3
29.9
36.6
15.3
-49.5
15.0
386.7
-14.6
.0
.6
10.6
102.6
165.8
-66.1
-62.4
-4.4
68.5
176.4
16.9
144.0
63.9
-17.7
96.3
-14.4
-25.0
24.7
223.1
.2
.0
.8
23.8
155.4
-55.0
-89.6
-57.2
81.2
49.9
82.8
23.2
165.4
-5.7
-62.3
115.8
8.2
-17.2
23.6
320.1
-8.6
.0
.7
26.2
149.6
58.0
-57.7
-44.9
39.0
98.4
54.8
64.3
7.6
-70.5
40.9
125.0
3.0
-28.3
11.9
148.7
17.8
.0
.7
25.4
393.6
27.4
117.7
52.9
95.1
16.6
167.0
5.0
104.5
-54.9
-15.1
74.7
20.9
-40.8
21.0
534.7
10.3
.0
.7
25.3
311.2
119.4
103.0
134.3
44.0
275.4
127.5
10.0
178.5
-31.9
12.6
65.3
-5.8
-13.1
22.3
298.8
1,414.5
1,539.0
1,765.9
2,332.1
1,885.5
2,454.6
2,190.7
1,750.6
1,803.7
1,796.9
2,786.1
2,925.1
3.3
8.5
9.1
-13.1
4.5
9.7
.7
1.6
4.5
-1.5
-1.3
14.2
-4.8
-2.8
5.6
-15.5
-6.2
10.5
-2.4
.6
-27.7
-1.4
-1.1
16.0
15.2
-6.2
29.4
-30.7
-4.3
4.9
13.9
-5.0
-18.0
-19.0
-5.4
-5.4
.2
1.6
-24.0
-.2
-4.9
27.9
14.0
-51.8
-.2
4.2
82.5
1.0
-44.9
-.2
-2.7
48.6
-2.0
29.1
-.2
24.0
22.8
-8.6
23.0
-.2
-29.1
13.5
.8
41.3
-.2
5.3
117.0
-.2
66.8
-32.2
-.6
26.2
6.2
1.3
-31.6
-170.0
149.4
-.2
1.2
-3.0
-11.1
95.6
-.2
-3.9
87.6
-16.3
-90.2
-.1
9.7
-32.8
30.6
-122.3
1,447.9
1,536.4
1,774.2
2,278.1
1,814.7
2,404.6
2,194.1
1,783.4
1,536.9
1,744.5
2,818.2
3,069.9
.1
123.7
17.4
1.3
1.1
-16.2
1.8
RELATION OF LIABILITIES
TO FINANCIAL ASSETS
33
Net flows through credit markets
34
35
36
3/
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
Other financial sources
Official foreign exchange
Special drawing rights certificates
Treasury currency
Life insurance reserves
Pension fund reserves
Interbank claims
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
Investment in bank personal trusts
Miscellaneous
54
Total financial sources
Floats not included in assets ( —)
5 5 U.S. government checkable deposits
5 6 Other checkable deposits
31 Trade credit
58
59
60
61
62
Liabilities not identified as assets ( —)
Treasury currency
Interbank claims
Security repurchase agreements
Taxes payable
Miscellaneous
63
Total identified to sectors as assets
-66.1
.1
I. Data in this table also appear in the Board's Z. 1 (780) quarterly statistical release, tables
F.6 and F.7. For ordering address, see inside front cover.
20.1
1.4
11.6
1.0
2. Excludes corporate equities and mutual fund shares.
Flow of Funds
1.59
A43
S U M M A R Y OF CREDIT M A R K E T DEBT OUTSTANDING 1
Billions of dollars, end of period
1991
1992
1993
1995
1994
1993
Transaction category or sector
1994
Q4
Q2
Ql
03
Q4
Ql
Q2
Nonfinancial sectors
1 Total credit market debt owed by
domestic nonfinancial sectors
11,184.1
11,727.9
12,368.3
12,970.5
12,368.3
12,490.8
12,620.8
12,776.8
12,970.5
13,140.6
13,343.2
By sector and instrument
2 U.S. government
3
Treasury securities
4
Budget agency issues and mortgages
2,776.4
2,757.8
18.6
3,080.3
3,061.6
18.8
3,336.5
3,309.9
26.6
3,492.3
3,465.6
26.7
3,336.5
3.309.9
26.6
3,387.7
3,361.4
26.3
3.395.4
3,368.0
27.4
3,432.3
3,404.1
28.2
3.492.3
3,465.6
26.7
3.557.9
3,531.5
26.4
3.583.5
3,556.7
26.8
5 Private
8,407.7
8,647.6
9,031.8
9,478.2
9,031.8
9.103.1
9,225.3
9.344.5
9,478.2
9,582.7
9,759.7
6
7
8
9
10
11
12
13
14
15
16
By instrument
Tax-exempt obligations
Corporate bonds
Mortgages
Home mortgages
Multifamily residential
Commercial
Farm
Consumer credit
Bank loans n.e.c
Commercial paper
Other loans
1,108.6
1,086.9
3,920.0
2,780.0
304.8
755.8
79.3
797.2
686.0
98.5
710.6
1,139.7
1,154.5
4,043.9
2,959.6
293.6
710.3
80.4
804.6
672.1
107.1
725.7
1,215.2
1,229.7
4,220.6
3,149.6
289.0
700.8
81.2
863.5
677.0
117.8
707.9
1,185.2
1,251.7
4,407.9
3,344.8
290.7
689.4
83.0
984.7
748.3
139.2
761.1
1,215.2
1,229.7
4,220.6
3,149.6
289.0
700.8
81.2
863.5
677.0
117.8
707.9
1,217.6
1,238.6
4,248.3
3,184.4
289.1
693.5
81.3
859.6
687.4
129.9
721.7
1.209.9
1,247.5
4,301.3
3,235.9
290.2
693.1
82.1
891.6
706.3
135.7
733.1
1,200.9
1,251.1
4,357.6
3.292.2
291.9
691.0
82.6
929.4
725.4
138.7
741.5
1,185.2
1,251.7
4,407.9
3.344.8
290.7
689.4
83.0
984.7
748.3
139.2
761.1
1,170.2
1,262.1
4,454.7
3,383.1
291.6
696.5
83.4
988.7
776.9
149.8
780.3
1,164.6
1,292.0
4,505.9
3.431.8
293.6
696.1
84.4
1,026.6
807.9
162.5
800.3
17
18
19
20
21
22
By borrowing sector
Household
Nontinancial business
Farm
Nonfarm noncorporate
Corporate
State and local government
3,784.5
3,712.1
135.0
1,116.9
2,460.2
911.1
3,998.7
3,716.1
136.0
1,075.0
2,505.1
932.8
4,285.8
3,750.1
138.3
1,050.4
2,561.5
995.9
4,638.9
3,887.5
141.2
1,065.8
2,680.5
951.8
4.285.8
3,750.1
138.3
1,050.4
2,561.5
995.9
4,326.3
3,782.5
136.7
1,052.6
2.593.2
994.3
4,417.7
3.825.8
141.5
1,056.3
2,628.0
981.9
4.520.9
3,852.5
143.1
1,060.2
2,649.2
971.1
4,638.9
3,887.5
141.2
1.065.8
2,680.5
951.8
4,684.8
3,960.8
138.9
1,083.0
2,738.9
937.1
4,780.1
4,050.0
143.4
1.091.5
2,815.1
929.6
23 Foreign credit market debt held in
United States
299.7
313.1
381.9
361.6
381.9
356.5
348.7
352.4
361.6
376.8
387.1
24
25
26
27
130.5
21.6
81.8
65.9
146.2
23.9
77.7
65.3
227.4
24.6
68.7
61.1
234.6
26.1
41.4
59.6
227.4
24.6
68.7
61.1
226.8
26.2
43.3
60.3
222.4
25.1
42.0
59.2
227.6
26.3
39.9
58.6
234.6
26.1
41.4
59.6
237.9
28.2
50.9
59.8
249.6
29.6
48.5
59.5
11,483.8
12,041.0
12,750.2
13,332.2
12,750.2
12,847.3
12,969.5
13,129.2
13,332.2
13,517.4
13,730.4
Bonds
Bank loans n.e.c
Commercial paper
U.S. government and other loans
28 Total credit market debt owed by nonfinancial
sectors, domestic and foreign
Financial sectors
29 Total credit market debt owed by
financial sectors
30
31
32
33
34
35
36
37
38
39
By instrument
U.S. government-related
Government-sponsored enterprises 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
By borrowing sector
40 Government sponsored enterprises
41 Federally related mortgage pools
42 Private financial sectors
43 Commercial banks
44
Bank holding companies
45
Funding corporations
46
Savings institutions
47
Credit unions
Life insurance companies
48
49
Finance companies
50
Mortgage companies
51
Real estate investment trusts (REITs)
52
Brokers and dealers
53
Issuers of asset-backed securities (ABSs)
2,751.0
3,005.7
3,300.6
3,762.2
3,300.6
3,426.5
3,525.7
3,626.8
3,762.2
3,834.1
3,936.3
1.564.2
402.9
1,156.5
4.8
1,186.8
638.9
4.8
78.4
385.7
79.1
1,720.0
443.1
1,272.0
4.8
1,285.8
725.8
5.4
80.5
394.3
79.9
1,884.1
523.7
1,355.6
4.8
1,416.5
844.4
8.9
66.5
393.5
103.1
2,168.4
700.6
1,467.8
.0
1,593.8
952.1
18.7
54.3
442.8
125.9
1,884.1
523.7
1,355.6
4.8
1,416.5
844.4
8.9
66.5
393.5
103.1
1,961.5
563.7
1,397.8
.0
1,465.1
882.0
11.4
62.4
408.8
100.4
2,030.5
600.3
1,430.1
.0
1,495.2
906.6
14.5
55.3
410.3
108.5
2,089.8
638.3
1,451.5
.0
1,537.0
930.4
17.5
52.4
420.5
116.2
2,168.4
700.6
1,467.8
.0
1,593.8
952.1
18.7
54.3
442.8
125.9
2.192.7
716.3
1,476.4
.0
1.641.4
990.2
20.0
57.1
454.1
120.0
2.245.0
748.1
1.496.9
.0
1,691.3
1,027.3
21.2
59.4
462.8
120.5
407.7
1,156.5
1,186.8
65.0
112.3
139.1
94.6
.0
.0
391.9
22.2
13.6
19.0
329.1
447.9
1,272.0
1,285.8
73.8
114.6
161.6
87.8
.0
.0
390.4
30.2
13.9
21.7
391.7
528.5
1,355.6
1,416.5
79.5
123.4
169.9
99.0
7
.2
390.5
29.2
17.4
33.7
473.5
700.6
1,467.8
1,593.8
89.5
133.6
199.3
111.7
.5
.6
440.7
17.8
31.1
34.3
534.7
528.5
1,355.6
1,416.5
79.5
123.4
169.9
99.0
.2
.2
390.5
29.2
17.4
33.7
473.5
563.7
1,397.8
1,465.1
78.4
124.2
190.7
97.6
.3
.3
401.9
23.8
21.0
31.3
495.7
600.3
1,430.1
1,495.2
82.1
126.8
191.5
99.0
.3
.3
414.2
19.3
24.8
31.3
505.8
638.3
1,451.5
1.537.0
87.5
129.6
200.6
102.7
.4
.3
420.9
17.5
29.5
29.4
518.6
700.6
1,467.8
1,593.8
89.5
133.6
199.3
111.7
.5
.6
440.7
17.8
31.1
34.3
534.7
716.3
1,476.4
1,641.4
90.3
137.0
221.2
106.9
.4
.6
456.7
19.8
32.8
26.9
548.8
748.1
1.496.9
1.691.3
95.4
142.0
229.1
105.2
.3
.6
467.3
20.1
34.4
26.8
570.0
All sectors
54 Total credit market debt, domestic and foreign. . . .
55
56
57
58
59
60
61
62
U.S. government securities
Tax-exempt securities
Corporate and foreign bonds
Mortgages
Consumer credit
Bank loans n.e.c
Open market paper
Other loans
14,234.8
15,046.7
16,050.7
17,094.3
16,050.7
16,273.8
16,495.2
16,756.0
17,094.3
17,351.5
17,666.7
4,335.7
1,108.6
1.856.3
3,924.8
797.2
785.9
565.9
860.4
4,795.5
1,139.7
2,026.4
4,049.3
804.6
776.6
579.0
875.7
5,215.8
1,215.2
2,301.5
4,229.6
863.5
768.2
580.0
877.0
5,660.7
1,185.2
2,438.4
4,426.6
984.7
828.8
623.5
946.6
5,215.8
1,215.2
2,301.5
4,229.6
863.5
768.2
580.0
877.0
5.349.2
1,217.6
2,347.3
4.259.7
859.6
776.0
582.0
882.5
5,425.9
1,209.9
2,376.5
4,315.8
891.6
786.7
587.9
900.8
5.522.1
1,200.9
2,409.1
4.375.2
929.4
804.0
599.2
916.2
5,660.7
1.185.2
2,438.4
4,426.6
984.7
828.8
623.5
946.6
5,750.6
1,170.2
2,490.2
4.474.7
988.7
862.1
654.7
960.1
5.828.5
1,164.6
2,568.9
4,527.1
1.026.6
896.9
673.8
980.4
I. Data in this table also appear in the Board's Z. I (780) quarterly statistical release, tables
L.2 through L.4. For ordering address, see inside front cover.
A44
1.60
DomesticNonfinancialStatistics • February 1996
S U M M A R Y OF FINANCIAL ASSETS A N D LIABILITIES'
Billions of dollars except as noted, end of period
1993
Transaction category or sector
1991
1992
1993
1994
1995
1994
Q4
Ql
Q2
Q3
Q4
Ql
Q2
CREDIT MARKET DEBT OUTSTANDING 2
1 Total credit m a r k e t assets
14,234.8
15,046.7
16,050.7
17,094.3
16,050.7
16,273.8
16,495.2
16,756.0
17,094.3
17,351.5
17,666.7
2 Private domestic nonfinancial sectors
3
Households
2,240.1
1,446.5
44.1
196.2
553.3
246.9
958.0
10,789.8
390.7
1,156.5
272.5
2,853.3
2,502.5
319.2
11.9
19.7
51.5
1,192.6
1,199.6
376.6
693.0
479.9
487.5
60.3
450.5
50.3
402.7
7.0
124.0
317.8
223.5
2,320.1
1,524.8
42.9
225.8
526.5
235.0
1,055.0
11.436.6
459.7
1.272.0
300.4
2,948.6
2,571.9
335.8
17.5
23.4
75.0
1,134.5
1,278.8
389.4
730.4
514.3
492.6
60.5
574.2
67.7
404.1
2,623.2
1,926.4
37.7
269.0
390.0
206.5
1,272.7
12,991.9
673.2
1,467.8
368.2
3,252.8
2,869.6
337.1
18.4
27.8
106.9
1,167.6
1,442.1
443.8
728.2
603.3
551.0
37.5
751.4
81.4
447.1
13.3
92.3
516.1
248.0
2,351.5
1,541.7
39.7
244.9
525.2
230.7
1,172.2
12,296.3
549.8
1,355.6
336.7
3,090.8
2,721.5
326.0
17.5
25.8
93.1
1,132.7
1,383.9
422.7
770.6
542.6
482.8
60.4
743.8
77.9
418.7
8.6
126.3
458.4
240.9
2,397.5
1,640.7
38.8
240.0
478.0
219.0
1,203.0
12,454.3
572.0
1,397.8
341.5
3,120.2
2,743.8
331.8
117.1
377.9
231.5
2,351.5
1,541.7
39.7
244.9
525.2
230.7
1,172.2
12,296.3
549.8
1,355.6
336.7
3,090.8
2,721.5
326.0
17.5
25.8
93.1
1,132.7
1,383.9
422.7
770.6
542.6
482.8
60.4
743.8
77.9
418.7
8.6
126.3
458.4
240.9
26.4
97.9
1,134.2
1,402.7
429.6
746.2
560.8
494.5
49.5
759.2
80.0
422.0
10.3
112.4
480.3
243.2
2,450.6
1,717.1
38.4
245.9
449.2
215.4
1,218.4
12,610.7
597.9
1,430.1
351.6
3,156.2
2,780.3
330.8
18.3
26.8
106.3
1,146.1
1,407.6
434.8
738.5
578.1
511.3
40.4
761.5
80.8
421.4
11.9
99.3
491.0
245.7
2,497.3
1,779.9
37.9
249.7
429.8
212.6
1,254.4
12,791.7
629.4
1,451.5
356.8
3,204.1
2,822.3
335.5
19.0
27.3
112.6
1,160.3
1,428.1
438.8
734.1
584.7
524.1
37.0
767.6
81.1
423.4
13.3
94.5
502.6
247.7
2,623.2
1,926.4
37.7
269.0
390.0
206.5
1,272.7
12,991.9
673.2
1,467.8
368.2
3,252.8
2,869.6
337.1
18.4
27.8
106.9
1,167.6
1,442.1
443.8
728.2
603.3
551.0
37.5
751.4
81.4
447.1
13.3
92.3
516.1
248.0
2,586.1
1,946.9
38.0
259.8
341.5
203.2
1,336.5
13,225.8
675.3
1,476.4
367.1
3,326.1
2,906.5
373.6
17.9
28.2
112.4
1,173.1
1,476.8
447.0
752.6
619.5
568.5
41.6
748.9
81.6
467.9
13.9
100.0
528.6
248.4
2,511.4
1,885.7
38.2
269.3
318.1
197.1
1,421.4
13,536.8
697.7
1,496.9
375.7
3,407.9
2,963.5
397.2
18.7
28.6
103.3
1,175.7
1,503.0
450.8
787.3
635.9
586.7
42.2
755.2
81.9
494.0
14.7
131.0
548.2
248.8
14,234.8
15,046.7
16,050.7
17,094.3
16,050.7
16,273.8
16,495.2
16,756.0
17,094.3
17,351.5
17,666.7
55.4
10.0
16.3
405.7
4,138.3
96.4
5,045.1
1,020.9
2,350.7
488.4
539.6
355.8
289.6
813.9
188.9
936.1
71.2
608.3
2,991.9
51.8
8.0
16.5
433.0
4,516.5
132.6
5,059.1
1,134.4
2,293.5
415.2
543.6
392.3
280.1
1,042.1
217.3
977.4
79.6
629.6
3,176.7
53.4
8.0
17.0
468.2
4,974.7
183.9
5,155.5
1,251.7
2,223.2
391.7
562.7
457.8
268.4
1,446.3
279.3
1,027.4
84.2
660.9
3,430.7
53.2
8.0
17.6
488.4
5,017.0
270.3
5,283.8
1,241.6
2,182.7
410.7
608.2
542.1
298.5
1,562.9
277.0
1,120.8
87.3
670.0
3,746.3
53.4
8.0
17.0
468.2
4,974.7
183.9
5,155.5
1,251.7
2,223.2
391.7
562.7
457.8
268.4
1,446.3
279.3
1,027.4
84.2
660.9
3,430.7
56.4
8.0
17.1
473.2
4,896.4
215.8
5,163.7
1,220.5
2,233.8
382.6
579.7
474.9
272.4
1,483.9
282.8
1,024.9
89.2
655.2
3,560.9
54.9
8.0
17.3
475.9
4,898.5
230.7
5,186.2
1,229.7
2,214.1
379.0
573.9
512.9
276.6
1,506.9
278.0
1,049.2
82.0
650.1
3,600.2
55.5
8.0
17.5
481.8
5,013.4
243.1
5,211.8
1,204.8
2,198.7
402.2
583.5
540.2
282.4
1,587.7
263.2
1,086.0
86.3
671.5
3,701.5
53.2
8.0
17.6
488.4
5,017.0
270.3
5,283.8
1,241.6
2,182.7
410.7
608.2
542.1
298.5
1,562.9
277.0
1,120.8
87.3
670.0
3,746.3
64.1
8.0
17.8
494.7
5,252.7
266.3
5,369.1
1,193.5
2,206.3
435.2
638.9
595.4
299.7
1,607.2
268.8
1,127.6
93.5
707.2
3,872.5
67.1
8.0
18.0
501.0
5,472.4
267.0
5,531.6
1,245.4
2,235.5
444.0
684.1
620.5
302.2
1,747.1
271.6
1,144.4
88.5
745.7
3,907.9
29,612.4
31,386.8
33,840.1
35,696.9
33,840.1
34,201.4
34,533.1
35,183.2
35,696.9
36,501.1
37,437.3
22.3
4,863.6
2,448.7
19.6
5,462.9
2,413.7
20.1
21.1
6,293.4
2,512.8
20.1
6,278.5
2,425.4
6,278.5
2,425.4
20.4
6,142.6
2,474.2
20.8
5,965.8
2,502.7
21.0
6,228.7
2,526.6
21.1
6,293.4
2,512.8
22.7
6,835.8
2,525.7
22.9
7,393.0
2,528.5
3.8
40.4
-130.6
6.8
42.0
-125.9
5.6
40.7
-107.1
3.4
38.0
-101.4
5.6
40.7
-107.1
.3
36.3
-127.1
.9
38.7
-134.2
1.2
30.6
-126.9
3.4
38.0
-101.4
4.2
32.3
-120.3
2.0
33.7
-133.0
-4.7
-4.2
9.2
17.8
-320.7
-4.9
-9.3
38.1
25.2
-378.2
-5.1
-4.7
120.5
26.2
-457.3
-5.4
-6.5
169.1
24.2
-347.8
-5.1
-4.7
120.5
26.2
-457.3
-5.2
-7.7
135.9
15.5
-398.7
-5.2
-7.4
162.5
21.3
-387.1
-5.3
-3.4
189.3
22.0
-395.6
-5.4
-6.5
169.1
24.2
-347.8
-5.4
-2.7
203.3
6.6
-382.3
-5.4
-2.6
192.0
21.2
-390.3
37,336.0
39,689.2
42,945.3
44,750.6
42,945.3
43,189.2
43,332.9
44,247.7
44,750.6
46,149.7
47,664.3
4
5
6
1
8
y
10
11
12
13
14
15
16
W
18
iy
20
21
22
23
24
25
26
27
28
29
30
31
32
Nonfarm noncorporate business
Nonfinancial corporate business
State and local governments
US. government
Foreign
Financial sectors
Government-sponsored enterprises
Federally related mortgage pools
Monetary authority
Commercial banking
U.S. commercial banks
Foreign banking offices
Bank holding companies
Banks in U.S. affiliated areas
Funding corporations
Thrift institutions
Life insurance companies
Other insurance companies
Private pension funds
State and local government retirement funds
Finance companies
Mortgage companies
Mutual funds
Closed-end funds
Money market funds
Real estate investment trusts (REITs)
Brokers and dealers
Asset-backed securities issuers (ABSs)
Bank personal trusts
8.1
18.2
RELATION OF LIABILITIES
TO FINANCIAL ASSETS
3 3 Total credit m a r k e t d e b t
34
35
36
3/
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
Other liabilities
Official foreign exchange
Special drawing rights certificates
Treasury currency
Life insurance reserves
Pension fund reserves
Interbank claims
Deposits at financial institutions
Checkable deposits and currency
Small time and savings deposits
Large time deposits
Money market fund shares
Security repurchase agreements
Foreign deposits
Mutual fund shares
Security credit
Trade debt
Taxes payable
Investment in bank personal trusts
Miscellaneous
5 3 Total liabilities
Financial assets not included in liabilities ( + )
5 4 Gold and special drawing rights
5 5 Corporate equities
3 6 Household equity in noncorporate business
Floats not included in assets ( —)
5 7 U.S. government checkable deposits
5 8 Other checkable deposits
5 9 Trade credit
60
61
62
63
64
Liabilities not identified as assets ( - )
Treasury currency
Interbank claims
Security repurchase agreements
Taxes payable
Miscellaneous
6 5 Total identified to sectors as assets
I. Data in this table also appear in the Board's Z. I (780) quarterly statistical release, tables
L.6 and L.7. For ordering address, see inside front cover.
2. Excludes corporate equities and mutual fund shares.
Selected Measures
2.10
NONFINANCIAL BUSINESS ACTIVITY
A45
Selected Measures
Monthly data seasonally adjusted, and indexes 1987=100, except as noted
1995
Measure
1992
1994
1993
Mar.
Apr.
May
June
July
Aug.
Sept. r
Oct. r
Nov.
1 Industrial production 1
107.7 r
111.5 r
118.1
121.9 r
121.4 r
121.3 r
121.4
121.5
122.7 r
122.9
122.5
122.8
Market groupings
7 Products, total
3
Final, total
4
Consumer goods
Equipment
5
6
Intermediate
7 Materials
106.4 r
I08.7 r
I06.0 r
112.5 r
99.3 r
109.7 r
no.or
112.7 r
I09.51"
117.5 r
101.8 r
113.8 r
115.6 r
118.3 r
113.7 r
I25.3 r
I07.3 r
122.0r
118.5 r
121.5 r
115.3 r
131,4 r
109.2 r
127.2 r
Wl.T
120.9 r
114.4
131.3
108.2 r
127.0 r
117.5 r
120.6 r
114. I r
I30.8 r
I08.2 r
I27.2 r
117.9 r
121. r
I14.8 r
I31.2 r
I08.2 r
I26.8 r
118.0 r
I21.2 r
114.6 r
131.6 r
I08.5 r
I26.8 r
119.2 r
122.4 r
115.9 r
132.9 r
I09.4 r
128.1 r
119.4
122.6
115.9
133.2
109.7
128.3
118.7
121.7
115.4
131.7
109.8
128.4
119.0
122.0
115.8
132.0
109.7
128.7
Industry groupings
8 Manufacturing
I08.2 r
112.3 r
119.7
124.0 r
I23.5 r
123.2
I23.3 r
123.3'
124.2 r
124.9
124.7
124.9
79.5 r
80.6 r
83.3 r
84.0 r
83.3 r
82.8'
82.6 r
82.3 r
82.6 r
82.8
82.3
82.2
97.5
105.2
114.2 r
116.0
I08.0 r
118.0
122.0 r
118.0 r
123.0 r
119.0
114.0
113.0
11 Nonagricultural employment, total 4
Goods-producing, total
12
Manufacturing, total
13
14
Manufacturing, production workers
Service-producing
15
16 Personal income, total
17
Wages and salary disbursements
Manufacturing
18
19
Disposable personal income 5
20 Retail sales 5
106.5
94.2
95.3
94.9
110.5
135.6
131.6
118.0
137.0
126.4
108.4
94.3
94.8
94.9
112.9
141.4
136.2
120.0
142.5
134.7
111.3
95.6
95.1
96.1
116.3
150.0
145.0
126.0
150.8
145.1
114.1
98.8
97.5
99.1
119.0
157.6
150.9
130.6
158.4
150.6
114.1
98.6
97.4
99.0
119.0
157.9
151.7
128.9
157.1
150.5
114.0
98.2
97.1
98.6
119.1
157.6
150.6
128.1
158.3
152.2
114.3
98.2
97.0
98.3
119.4
158.5
151.8
128.4
159.0
153.5
114.3
97.9
96.6
97.8
119.6
159.5
153.0
128.5
159.9
152.9
114.6
97.9
96.6
97.9
119.9
159.6
152.8
128.9
160.0
153.9
114.7
97.9
96.4
97.7
120.1
160.3
153.5
129.3
160.6
153.8
114.8
97.9
96.3
97.6
120.1
n.a.
n.a.
n.a.
n.a.
153.2
114.9
97.8
96.2
97.4
120.4
n.a.
n.a.
n.a.
n.a.
154.3
Prices6
21 Consumer ( 1 9 8 2 - 8 4 = 1 0 0 )
22 Producer finished goods (1982= 100)
140.3
123.2
144.5
124.7
148.2
125.5
151.4
127.1
151.9
127.6
152.2
128.1
152.5
128.2
152.5
128.21"
152.9
128.1
153.2
127.9
153.7
128.5
153.6
128.6
9 Capacity utilization, manufacturing (percent) 2 . .
10 Construction contracts' 1
1. Data in this table also appear in the Board's G.17 (419) monthly statistical release. For
the ordering address, see the inside front cover. The latest historical revision of the industrial
production index and the capacity utilization rates was released in November 1995. See "A
Revision to Industrial Production and Capacity Utilization, 1991-95," Federal
Reserve
Bulletin, vol. 82 (January 1996), pp. 16-25. For a detailed description of the industrial
production index, see "Industrial Production: 1989 Developments and Historical Revision,"
Federal Reserve Bulletin, vol. 76 (April 1990), pp. 187-204.
2. Ratio of index of production to index of capacity. Based on data from the Federal
Reserve, DRI McGraw-Hill, U.S. Department of Commerce, and other sources.
3. Index of dollar value of total construction contracts, including residential, nonresidential, and heavy engineering, from McGraw-Hill Information Systems Company, F.W. Dodge
Division.
4. Based on data from U.S. Department of Labor, Employment and Earnings. Series covers
employees only, excluding personnel in the armed forces.
2.11
5. Based on data from U.S. Department of Commerce, Survey of Current Business.
6. Based on data not seasonally adjusted. Seasonally adjusted data for changes in the price
indexes can be obtained from the U.S. Department of Labor, Bureau of Labor Statistics,
Monthly Labor Review.
NOTE. Basic data (not indexes) for series mentioned in notes 4 and 5, and indexes for series
mentioned in notes 3 and 6, can also be found in the Survey of Current Business.
Figures for industrial production for the latest month are preliminary, and many figures for
the three months preceding the latest month have been revised. See "Recent Developments in
Industrial Capacity and Utilization," Federal Reserve Bulletin, vol. 76 (June 1990), pp.
411-35. See also "Industrial Production Capacity and Capacity Utilization since 1987,"
Federal Reserve Bulletin, vol. 79 (June 1993), pp. 590-605.
LABOR FORCE, EMPLOYMENT, A N D UNEMPLOYMENT
Thousands of persons; monthly data seasonally adjusted
1995
Category
1992
1993
1994
Apr.
May
June
July
Aug.
Sept. r
Oct/
Nov.
HOUSEHOLD SURVEY DATA1
1 Civilian labor force 2
2
3
4
5
Nonagricultural industries 1
Agriculture
Unemployment
Number
Rate (percent of civilian labor force)
126,982
128,040
131,056
132,737
131,811
131,869
132,519
132,211
132,591
132,648
132,442
114,391
3,207
116,232
3,074
119,651
3,409
121,478
3,594
120,962
3,357
121,034
3,451
121,550
3,409
121,417
3,362
121,867
3,273
121,944
3,455
121,734
3,276
9,384
7.4
8,734
6.8
7,996
6.1
7,665
5.8
7,492
5.7
7,384
5.6
7,559
5.7
7,431
5.6
7,451
5.6
7,249
5.5
7,432
5.6
108,604
110,525
113,423
116,310
116,248
116,547
116,575
116,838
116,932
116,998
117,164
18,104
635
4,492
5,721
25,354
6,602
29,052
18,653
18,003
611
4,642
5,787
25,675
6,712
30,278
18,817
18.064
604
4,916
5,842
26,362
6,789
31,805
19,041
18,506
583
5,242
6,184
27,062
6,924
32,548
19,261
18,456
582
5,190
6,177
27,045
6,925
32,630
19,243
18,428
582
5,230
6,192
27.118
6,930
32,784
19,283
18,353
577
5,226
6,195
27,184
6,938
32,820
19,282
18,357
575
5,233
6,217
27,177
6,947
32,986
19,346
18,322
573
5,262
6,206
27,245
6,957
33,047
19,320
18,303
571
5,285
6,215
27,261
6,976
33,083
19,304
18,271
568
5,289
6,233
27,347
6,990
33,170
19,296
ESTABLISHMENT SURVEY DATA
6 Nonagricultural payroll e m p l o y m e n t 4
7
8
9
10
II
1?
13
14
Manufacturing
Mining
Contract construction
Transportation and public utilities
Trade
Finance
Service
Government
1. Beginning January 1994, reflects redesign of current population survey and population
controls from the 1990 census.
2. Persons sixteen years of age and older, including Resident Armed Forces. Monthly
figures are based on sample data collected during the calendar week that contains the twelfth
day; annual data are averages of monthly figures. By definition, seasonality does not exist in
population figures.
3. Includes self-employed, unpaid family, and domestic service workers.
4. Includes all full- and part-time employees who worked during, or received pay for, the
pay period that includes the twelfth day of the month; excludes proprietors, self-employed
persons, household and unpaid family workers, and members of the armed forces. Data are
adjusted to the March 1992 benchmark, and only seasonally adjusted data are available at this
time.
SOURCE. Based on data from U.S. Department of Labor, Employment and Earnings.
A46
2.12
Domestic Nonfinancial Statistics • February 1996
OUTPUT, CAPACITY, A N D CAPACITY UTILIZATION 1
Seasonally adjusted
1994'
Q4
1995'
Ql
Q2
1995r
1994'
Q4
Q3
Output (1987=100)
Ql
Q2
1994'
Q3
Capacity (percent of 1987 output)
1995'
Ql
Q4
Q2
Q3
Capacity utilization rate (percent)"
1 Total industry
120.6
121.8
121.4
122.4
142.4
143.7
145.0
146.4
84.7
84.8
83.7
83.6
2 Manufacturing
122.8
124.0
123.3
124.1
145.7
147.2
148.7
150.3
84.3
84.3
82.9
82.6
3
4
Primary processing 1
Advanced processing 4
118.4
124.9
1 19.1
126.3
1 17.7
126.(1
117.1
127.5
132.6
152.1
133.4
153.8
134.4
155.6
135.4
157.5
89.3
82.1
89.3
82.2
87.6
81.0
86.5
80.9
5
6
/
8
9
10
1 1
12
13
Durable goods
Lumber and products
Primary metals
Iron and steel
Nonferrous
Industrial machinery and equipment
Electrical machinery
Motor vehicles and parts
Aerospace and miscellaneous
transportation equipment
129.8
106.0
120.8
124.3
116.1
166.0
163.4
144.3
132.0
105.3
121.2
125.4
115.6
171.9
167.9
147.7
131.4
102.9
119.1
121.9
115.1
174.4
171.2
140.5
133.0
104.9
118.2
121.3
113.9
179.0
178.4
140.7
154.9
117.0
126.8
131.0
121.2
190.4
186.4
169.6
156.8
117.4
126.9
130.9
121.5
194.8
191.6
172.1
158.9
118.0
127.5
131.7
121.9
199.6
197.6
174.2
161.1
118.6
128.0
132.5
122.2
204.5
203.9
176.4
83.8
90.6
95.3
94.9
95.8
87.2
87.7
85.1
84.2
89.7
95.6
95.8
95.2
88.2
87.7
85.8
82.7
87.2
93.4
92.6
94.5
87.4
86.7
80.6
82.6
88.5
92.3
91.6
93.2
87.5
87.5
79.7
89.6
89.6
88.7
86.9
132.2
132.2
132.2
132.1
67.8
67.8
67.1
65.8
14
1.5
16
IV
18
19
Nondurable goods
Textile mill products
Paper and products
Chemicals and products
Plastics materials
Petroleum products
115.0
116.0
121.8
123.4
124.6
107.5
1 15.2
1 16.4
121.0
125.3
127.5
108.3
114.4
113.7
121.2
124.0
122.9
108.0
114.3
110.9
119.4
124.5
1 18.3
109.2
135.7
128.1
129.8
152.8
130.8
115.9
136.6
129.1
130.6
153.7
132.1
116.0
137.5
130.1
131.5
154.7
133.8
1 16.2
138.4
131.1
132.5
155.6
1.35.4
116.4
84.7
90.5
93.8
80.7
95.3
92.7
84.3
90.2
92.7
81.5
96.5
93.3
83.2
87.5
92.1
80.1
91.9
92.9
82.6
84.6
90.1
80.0
87.3
93.8
100.1
116.8
117.7
100.6
1 18.4
118.9
100.7
120.7
120.4
100.2
124.9
125.0
112.0
134.2
131.4
1 12.0
134.4
131.7
112.0
134.8
132.1
112.0
135.2
132.5
89.3
87.1
89.5
89.8
88.0
90.3
89.9
89.5
91.1
89.5
92.4
94.3
1973
1975
Previous cycle
High
Low
High
20 Mining
21 Utilities
22
Electric
Low
Latest cycle 6
High
Low
1994
Nov.
1995
June
July
Aug/
Sept.'
Oct.
Nov.p
Capacity utilization rate (percent)'
1 Total industry
89.2
72.6
87.3
71.8
84.9
78.0
84.6
83.5 r
83.3 r
83.8
83.7
83.2
83.1
2 Manufacturing
88.9
70.8
87.3
70.0
85.2
76.6
84.2
82.6r
82.3'
82.6
82.8
82.3
82.2
92.2
87.5
68.9
72.0
89.7
86.3
66.8
71.4
89.0
83.5
77.9
76.1
89.1
82.1
86.9'
80.8'
86.6'
80.5r
86.1
81.2
86.8
81.1
86.4
80.7
86.0
80.5
88.8
90.1
100.6
105.8
92.9
68.5
62.2
66.2
66.6
61.3
86.9
87.6
102.4
110.4
90.5
65.0
60.9
46.8
.38.3
62.2
84.0
93.3
92.8
95.7
88.7
73.7
76.1
74.2
72.0
75.2
83.7
89.1
94.7
93.6
96.0
82.3'
87.2'
92.0 r
90.3'
94.2'
82.0r
87.6r
92.5 r
90.2'
95.5'
82.6
87.5
90.1
88.9
91.6
83.1
90.3
94.3
95.7
92.5
82.3
89.4
93.0
91.8
94.4
82.2
88.6
93.4
91.9
95.2
96.4
87.8
93.4
74.5
63.8
51.1
92.1
89.4
93.0
64.9
71.1
44.5
84.0
84.9
85.1
71.8
77.0
56.6
87.2
87.3
85.0
86.7'
86.6'
79.8'
86.8r
87.1'
77.8'
87.8
87.7
80.6
88.1
87.8
80.8
88.5
87.5
78.6
89.2
87.0
78.7
77.0
66.6
81.1
66.9
88.4
78.8
67.7
66.1'
66.3'
66.0
65.0
60.7
58.7
86.7
92.1
94.8
85.9
97.0
88.5
80.3
78.8
86.7
79.0
74.8
84.6
84.8
90.5
94.2
80.6
95.2
93.5
83.0'
84.7'
90.9'
80.2'
90.2 r
93.4'
82.7
84.0r
91.8 r
79.8 r
87.9r
93.7'
82.6
85.7
89.6
80.0
85.4
93.2
82.4
84.1
89.0
80.2
88.7
94.5
82.4
84.2
89.6
81.1
82.1
83.9
86.7
80.8
93.2
93.2
86.5
92.6
94.8
86.1
83.1
86.7
89.2
87.0
89.6
90.1
89.7'
9l.6 r
89.9r
90.8'
92.3'
89.2
95.3
98.1
89.3
90.9
92.5
88.2
90.5
92.2
88.2
91.5
92.7
3
4
Primary processing 1
Advanced processing
5
6
7
8
9
10
Durable goods
Lumber and products
Primary metals
Iron and steel
Nonferrous
Industrial machinery and
equipment
Electrical machinery
Motor vehicles and parts
Aerospace and miscellaneous
transportation equipment
II
12
13
14
15
16
17
18
19
Nondurable goods
Textile mill products
Paper and products
Chemicals and products
Plastics materials
Petroleum products
20 Mining
21 Utilities
22
Electric
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
94.4
95.6
99.0
88.4
82.5
82.7
96.6
88.3
88.3
80.6
76.2
78.7
1. Data in this table also appear in the Board's G.17 (419) monthly statistical release. For
the ordering address, see the inside front cover. The latest historical revision of the industrial
production index and the capacity utilization rates was released in November 1995. See "A
Revision to Industrial Production and Capacity Utilization, 1991-95," Federal Reserve
Bulletin, vol. 82 (January 1996). pp. 16-25. For a detailed description of the industrial
production index, see "Industrial Production: 1989 Developments and Historical Revision,"
Federal Reserve Bulletin, vol. 76 (April 1990), pp. 187-204.
2. Capacity utilization is calculated as the ratio of the Federal Reserve's seasonally adjusted
index of industrial production to the corresponding index of capacity.
•
3. Primary processing includes textiles; lumber; paper; industrial chemicals; synthetic
materials; fertilizer materials; petroleum products; rubber and plastics; stone, clay, and glass;
primary metals; and fabricated metals.
4. Advanced processing includes foods; tobacco; apparel; furniture and fixtures; printing
and publishing; chemical products such as drugs and toiletries; agricultural chemicals; leather
and products; machinery; transportation equipment; instruments; and miscellaneous manufactures.
5. Monthly highs, 1978-80; monthly lows, 1982.
6. Monthly highs, 1988-89; monthly lows, 1990-91.
Selected Measures
2.13
INDUSTRIAL PRODUCTION
A47
Indexes and Gross Value 1
Monthly data seasonally adjusted
Group
1994r
1992
proportion
1994r
avg.
Nov.
Dec.
1995
Jan. r
Feb. r
Mar/
Apr/
May r
June r
July r
Aug/
Sept/
Oct.
Nov.p
Index (1987 = 100)
MAJOR M A R K E T S
1 Total index
2 Products
Final products
3
4
Consumer goods, total
Durable consumer goods
5
Automotive products
6
Autos and trucks
7
Autos, consumer
8
9
Trucks, consumer
Auto parts and allied goods
10
11
Other
Appliances, televisions, and air
12
conditioners
Carpeting and furniture
13
14
Miscellaneous home goods
Nondurable consumer goods
15
Foods and tobacco
16
Clothing
17
18
Chemical products
Paper products
19
20
Energy
Fuels
21
Residential utilities
22
118.1
120.5
121.5
121.8
121.7
121.9
121.4
121.3
121.4
121.5
122.7
122.9
122.5
122.8
r
60.6
46.3 r
28.6 r
5.6 r
2.5
1.6
.9
.7
.9
3.0
115.6
118.3
113.7
124.2
130.8
132.9
106.2
180.2
124.9
118.5
117.5
120.1
114.8
125.4
131.5
132.7
104.5
182.6
127.8
120.0
118.2
120.9
115.5
127.5
133.9
135.3
109.1
181.4
129.4
121.8
118.4
121.3
115.5
127.1
134.4
136.6
111.4
180.6
128.4
120.8
118.3
121.1
114.9
127.3
135.3
138.2
111.5
185.2
127.9
120.4
118.5
121.5
115.3
126.0
134.4
137.5
111.2
183.6
126.7
118.6
117.7
120.9
114.4
124.9
131.7
132.8
105.5
180.9
128.0
119.0
117.5
120.6
114.1
121.6
127.1
127.4
99.4
177.1
125.0
116.7
117.9
121.1
114.8
122.3
129.1
129.5
99.2
183.6
126.8
116.3
118.0
121.2
114.6
121.4
125.3
123.9
101.0
163.9
126.6
118.1
119.2
122.4
115.9
124.0
130.7
132.0
100.6
188.2
126.6
118.1
119.4
122.6
115.9
125.8
132.8
133.1
102.6
187.7
130.7
119.6
118.7
121.7
115.4
123.2
128.4
128.6
100.2
179.1
126.5
118.7
119.0
122.0
115.8
124.4
130.0
130.4
99.7
185.3
127.6
119.6
.7
.8
1.5
23.0
10.3
2.4
4.5
2.9
2.9
.9
132.7
106.7
118.8
133.9
108.7
120.1
112.3
139.5
110.4
120.4
112.6
111.5
100.3
130.0
106.6
110.6
107.2
135.0
108.3
120.7
111.9
110.1
98.3
129.2
106.6
113.1
108.7
114.8
132.2
106.1
119.7
112.7
111.5
98.7
129.7
105.9
113.9
110.4
115.2
131.6
109.1
118.8
111.8
131.4
118.0
113.1
113.1
94.6
128.6
106.3
115.8
108.8
118.7
132.2
107.9
117.4
113.0
112.8
93.6
128.6
107.6
116.1
108.2
119.4
135.8
104.4
113.9
111.8
93.9
132.6
106.7
122.3
108.4
128.2
139.4
107.0
117.8
113.5
111.4
93.2
133.5
107.3
118.9
111.4
122.1
138.6
105.8
117.0
113.5
96.9
126.9
106.9
112.2
108.8
113.5
131.2
103.0
118.1
112.4
111.5
96.7
127.3
106.5
115.8
108.2
119.0
140.4
105.7
118.1
113.7
111.6
91.3
135.4
107.0
119.3
109.0
123.6
100.0
2.1
109.2
99.2
126.1
107.1
113.8
106.6
116.7
111.8
137.9
106.4
121.3
112.7
111.5
99.6
131.3
106.0
110.9
107.6
112.2
23
24
25
26
27
28
29
30
31
32
33
Equipment
Business equipment
Information processing and related
Computer and office equipment
Industrial
Transit
Autos and trucks
Other
Defense and space equipment
Oil and gas well drilling
Manufactured homes
17.7r
13.7r
5.7
l.4 r
4.0
2.6
1.2
1.4r
3.3r
,6r
.2
125.3
144.9
172.0
275.5
122.0
140.4
141.1
123.2
71.9
90.9
132.9
128.3
150.2
182.7
307.7
124.2
142.2
144.2
125.7
69.4
87.4
140.1
129.3
151.5
185.2
313.8
125.0
142.4
142.9
125.9
69.2
87.3
150.2
130.4
153.2
187.3
324.2
126.5
143.8
145.6
127.2
68.9
87.7
153.1
131.0
154.3
188.7
334.9
127.2
145.9
147.7
127.2
68.2
88.8
144.6
131.4
155.1
191.6
343.6
126.9
145.7
146.2
126.3
67.8
87.2
145.8
131.3
155.0
194.5
356.4
126.1
142.9
141.5
123.2
67.1
89.3
146.6
130.8
154.3
193.9
362.1
126.5
139.6
137.8
122.7
66.8
90.5
148.3
131.2
155.1
196.0
363.2
126.2
140.3
139.5
122.6
66.8
86.8
149.6
131.6
155.7
197.2
371.7
127.1
139.8
139.9
122.6
66.5
88.4
148.6
132.9
157.5
201.0
379.6
129.1
138.0
141.3
122.2
66.1
89.5
155.9
133.2
158.3
203.0
390.0
128.9
137.9
143.3
123.4
65.2
88.3
158.0
131.7
156.8
206.7
403.9
128.6
122.7
135.7
122.1
64.3
83.5
158.9
132.0
157.6
208.8
417.7
129.3
120.1
135.6
123.8
63.2
83.1
34
35
36
Intermediate products, total
Construction supplies
Business supplies
14.3
5.3
9.0
107.3
106.2
108.2
109.6
108.7
110.4
109.9
110.5
109.7
109.5
109.7
109.5
109.5
109.5
109.6
109.2
109.2
109.3
108.2
108.0
108.5
108.2
106.6
109.4
108.2
107.2
109.1
108.5
107.3
109.5
109.4
107.0
111.0
109.7
108.8
110.4
109.8
108.5
110.7
109.7
108.0
110.9
39.41'
20.8 r
4.0 r
7.5
9.2 r
3.1r
8.9
1.1
1.8
3.9r
9.7 r
6.3
3.3
122.0
132.3
135.2
142.9
122.5
121.9
118.0
109.9
118.8
120.2
117.9
105.3
100.7
114.5
125.2
137.3
139.0
150.8
125.7
124.7
120.6
114.5
122.0
122.5
119.4
105.6
101.7
113.4
126.6
139.2
142.0
152.1
127.5
127.4
122.1
113.2
121.8
124.7
122.6
106.0
102.1
113.5
127.1
140.0
142.9
154.0
127.7
126.7
122.2
115.1
120.9
126.4
119.5
106.2
102.0
114.3
127.1
140.2
142.6
155.4
127.0
126.4
121.5
113.5
121.6
125.7
117.8
106.4
102.3
114.5
127.2
140.3
140.4
157.3
127.0
126.7
121.5
113.6
122.5
125.6
117.4
106.4
102.1
114.9
127.0
139.8
137.9
158.9
125.9
126.1
121.7
113.2
122.3
125.6
118.4
106.6
102.2
115.5
127.2
139.8
135.9
160.3
125.6
125.5
122.2
112.8
125.6
126.2
116.9
107.2
102.3
116.9
126.8
139.7
135.8
161.7
124.5
123.5
120.4
109.0
121.0
125.2
117.4
107.2
103.0
115.5
126.8
140.2
133.9
164.4
124.4
124.9
118.9
102.6
123.9
124.4
113.8
107.5
102.3
118.1
128.1
142.3
138.4
167.1
124.9
123.1
118.8
109.2
120.4
123.1
114.6
108.5
101.4
122.8
128.3
144.1
139.7
169.1
126.9
126.9
117.8
106.2
116.8
123.3
115.1
106.4
101.3
116.6
128.4
144.4
139.6
169.8
126.9
125.7
118.7
107.1
120.8
123.6
114.3
105.5
100.3
115.9
128.7
145.1
140.0
170.8
127.6
126.5
117.7
107.2
115.1
124.0
113.9
106.2
100.6
117.4
97.2
95.2
117.6
116.9
120.0
119.3
121.0
120.2
121.3
120.5
121.1
120.4
121.3
120.6
120.9
120.3
121.0
120.5
121.1
120.5
121.2
120.7
122.3
121.7
122.4
121.9
122.2
121.7
122.5
121.9
98.2 r
21.0'
25.1'
115.5
112.5
113.7
117.5
113.6
115.2
118.4
114.2
116.1
118.6
118.4
113.4
115.1
118.5
113.8
115.4
117.9
113.1
114.6
117.8
113.3
113.9
117.8
113.9
114.7
117.8
114.0
114.5
118.9
114.8
115.1
119.0
114.8
115.5
118.5
114.5
116.0
115.1
114.8
115.4
12.5r
145.0
150.6
152.1
153.7
154.7
155.8
156.2
155.8
156.5
157.2
158.9
159.6
158.7
159.6
12.2r
29.1'
129.4
128.0
132.5
132.2
133.3
134.0
134.3
134.6
134.6
134.5
134.8
134.6
133.7
134.3
132.5
134.4
133.2
133.8
133.2
133.7
134.4
135.1
134.5
136.1
131.8
136.5
131.5
136.7
37 Materials
38
Durable goods materials
39
Durable consumer parts
40
Equipment parts
41
Other
42
Basic metal materials
Nondurable goods materials
43
44
Textile materials
Paper materials
45
46
Chemical materials
47
Other
Energy materials
48
Primary energy
49
50
Converted fuel materials
2.R
111.2
111.6
99.5
127.7
107.0
110.8
109.0
111.5
111.2
101.8
118.0
111.2
92.3
136.2
106.5
117.6
108.7
121.3
SPECIAL AGGREGATES
51 Total excluding autos and trucks
52 Total excluding motor vehicles and parts
53 Total excluding computer and office
equipment
54 Consumer goods excluding autos and trucks .
55 Consumer goods excluding energy
56 Business equipment excluding autos and
trucks
57 Business equipment excluding computer and
office equipment
58 Materials excluding energy
114.1
118.6
A48
2.13
Domestic Nonfinancial Statistics • February 1996
INDUSTRIAL PRODUCTION
Group
Indexes and Gross Value 1 —Continued
1992
propor-
siccode
1994r
1994r
av".
Mar.r
Apr. r
May'
June r
July'
Aug. r
Sept. r
Oct.
Nov. p
Index (1987 = 100)
MAJOR INDUSTRIES
59 Total index
100.0
118.1
120.5
121.5
121.8
121.7
121.9
121.4
121.3
121.4
121.5
122.7
122.9
122.5
122.8
85.4'
26.6'
58.9'
119.7
115.6
121.7
122.7
1 18.2
124.9
123.8
119.8
125.7
124.1
119.4
126.4
123.9
119.1
126.2
124.0
118.9
126.5
123.5
118.2
126.0
123.2
117.9
125.7
123.3
117.1
126.3
123.3
116.9
126.3
124.2
116.6
127.8
124.9
117.8
128.3
124.7
117.5
128.1
124.9
117.3
128.4
24
25
45.0'
2.0
1.4
125.8
104.0
11 I.I
129.5
104.3
114.2
131.2
108.6
114.0
131.8
107.1
1 13.8
132.1
105.0
1 14.9
132.2
103.9
113.4
131.6
103.9
111.4
131.1
101.7
110.8
131.5
103.0
111.3
131.5
103.7
111.1
133.2
103.7
110.9
134.5
107.3
1 12.2
133.8
106.4
112.2
134.3
105.7
112.8
32
33
331.2
331PT
333-6,9
34
2.1
3.1
1.7
.1
1.4
5.0
102.3
116.4
119.3
107.9
1 12.2
1 10.5
104.3
120.0
122.6
113.4
116.3
113.3
105.7
122.8
127.4
120.6
1 16.7
1 14.8
105.5
121.5
125.5
114.9
116.2
114.3
104.7
120.8
124.9
116.4
115.3
115.0
104.7
121.3
125.8
1 16.8
115.4
114.3
103.4
120.2
123.5
114.7
115.7
112.3
104.1
119.5
123.0
113.0
114.8
113.7
103.8
1 17.5
119.2
1 12.9
114.9
1 13.7
103.2
1 18.3
119.3
1 11.5
116.5
112.4
103.0
115.4
117.7
114.2
111.9
114.3
103.6
120.9
127.0
118.6
113.1
115.0
103.6
119.4
122.1
111.3
115.5
114.0
103.9
120.1
122.5
60 Manufacturing
Primary processing
61
62
Advanced processing
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91
Durable goods
Lumber and products
Furniture and fixtures
Stone, clay, and glass
products
Primary metals
Iron and steel
Raw steel
Nonterrous
Fabricated metal products. . .
Industrial machinery and
equipment
Computer and office
equipment
Electrical machinery
Transportation equipment. . .
Motor vehicles and parts .
Autos and light trucks .
Aerospace and
miscellaneous
transportation
equipment
Instruments
Miscellaneous
Nondurable goods
Foods
Tobacco products
Textile mill products
Apparel products
Paper and products
Printing and publishing
Chemicals and products . . . .
Petroleum products
Rubber and plastic products .
Leather and products
92 Mining
93
Metal
94
Coal
95
Oil and gas extraction
96
Stone and earth minerals
97 Utilities
98
Electric
99
Gas
116.7
1 14.5
35
8.0'
157.7
165.9
167.5
171.4
171.8
172.4
174.3
174.6
174.4
176.0
179.5
181.6
184.1
187.0
357
36
37
371
371 PT
1.8'
7.2'
9.5'
4.8
2.5
275.5
154.3
115.3
141.2
133.1
307.7
162.8
116.3
144.1
132.8
313.8
166.3
117.3
145.9
135.7
324.2
166.7
1 17.8
147.3
137.1
334.9
167.7
1 18.5
148.4
138.6
343.6
169.4
118.0
147.6
1.37.9
356.4
169.6
115.7
143.0
132.9
362.1
171.1
113.2
138.8
127.3
363.2
173.0
113.4
139.7
129.2
371.7
175.7
111.6
136.7
124.3
379.6
178.7
114.1
142.1
131.6
390.0
180.9
1 14.0
143.2
132.8
403.9
182.2
109.4
139.8
128.4
417.7
183.0
108.5
140.7
130.0
372-6.9
38
39
4.7'
5.4
1.3
90.5
109.1
120.1
89.5
110.3
122.7
89.8
110.4
122.1
89.5
89.5
110.9
123.3
111.2
123.5
89.7
110.5
124.1
89.4
1 10.8
122.7
88.5
109.6
122.3
88.1
110.9
123.1
87.6
110.2
121.4
87.2
1 11.4
122.4
85.9
111.3
122.9
80.2
1 11.4
122.2
123.1
1 13.0
115.1
114.8
94.1
115.9
115.6
115.9
88.6
117.2
100.6
121.0
100.1
126.2
107.7
141.8
85.4
1 14.8
114.2
88.1
115.9
99.8
121.0
100.3
124.7
108.0
141.9
85.1
1 15.1
115.0
92.3
116.2
99.3
114.6
115.1
92.0
117.2
97.4
121.2
99.2
123.5
107.8
140.8
82.7
114.4
115.9
89.3
113.6
97.5
122.4
99.0
124.0
107.4
138.2
83.0
1 14.3
116.1
114.3
115.3
99.1
109.9
94.8
121.3
99.0
124.0
109.0
137.7
78.7
114.3
115.5
91.3
1 12.4
94.5
1 18.6
100.5
124.4
108.5
138.7
80.8
1 14.3
1 15.3
114.5
115.0
90.3
122.3
101.3
123.2
108.3
140.3
86.2
115.5
114.9
93.0
116.6
101.6
122.5
100.7
124.7
108.1
141.6
85.8
101.0
166.8
112.2
93.6
1 1 1.9
100.7
172.2
117.0
91.9
113.5
100.0
172.1
109.7
92.4
111.6
100.0
171.2
1 15.3
91.3
113.1
90.2
112.6
98.8
175.0
109.5
90.8
111.5
121.0
121.2
120.6
122.7
122.2
124.5
128.8
130.0
124.3
123.1
122.7
124.3
122.5
122.4
122.9
123.3
127.1
40.5
20
21
22
23
26
27
28
29
30
31
491,493PT'
492.493PT'
6.9'
.5'
1.0
4.8'
.6
100.3
163.5
112.6
93.3
107.2
99.9
160.1
112.7
92.7
109.7
100.7
162.6
116.5
92.9
109.9
100.6
164.2
116.0
92.4
113.1
100.8
165.5
115.1
93.0
111.3
100.3
164.5
114.0
92.2
114.2
100.6
164.6
100.5
164.3
1 12.3
1 10.8
93.1
112.7
93.4
1 11.1
7.7
10
12
13
14
.3
113.2
88.1
1 13.5
100.1
1 19.2
100.1
121.3
106.7
135.9
87.5
1 17.9
117.7
118.5
1 16.7
117.7
1 12.8
1 16.5
117.4
113.1
117.3
118.0
114.3
1 18.5
119.1
116.4
1 19.2
119.5
1 18.0
118.8
118.9
118.4
121.2
125.5
1.4
3.5
6.1
1.6
101.0
121.1
99.3
125.0
109.1
141.1
85.8
122.1
96.4
110.4
95.5
119.9
98.6
124.4
108.6
137.8
81.2
90.2
1 10.5
94.2
118.2
100.3
125.1
1 10.1
139.9
80.5
111.0
92.6
1 19.3
100.2
126.8
108.6
139.8
78.7
98.9
174.9
1 12.3
77.5
111.7
1 14.4
115.0
91.8
110.9
92.0
115.7
100.8
126.5
108.7
140.4
77.1
124.1
SPECIAL AGGREGATES
100 Manufacturing excluding motor
vehicles and parts
101 Manufacturing excluding office
and computing machines . . .
80.6'
1 18.5
121.5
122.5
122.8
122.4
122.6
122.3
122.2
122.3
122.5
123.1
123.8
123.8
123.9
83.7'
116.6
119.2
120.2
120.4
120.0
120.1
119.3
1 18.9
119.1
118.9
119.8
120.3
119.9
119.9
Gross value (billions of 1987 dollars, annual rates)
MAJOR MARKETS
102 Products, total
2,002.9 r 2,195.0
2,230.9
2,244.6
2,247.3
2,246.9
2,252.0
2,236.5
2,231.5
2,239.1
2,238.8
2,257.8
2,267.9
2,248.3
2,256.8
103 Final
104
Consumer goods
105
[Equipment
106 Intermediate
1.552.2'
1,033.4'
518.8'
450.7'
1,7.31.8
1,128.7
603.1
499.1
1,743.1
1,135.6
607.5
501.5
1,748.3
1,134.6
613.8
499.0
1.748.6
1.131.1
617.5
498.3
1,755.0
1,135.5
619.5
497.0
1.743.1
1.125.2
617.9
493.4
1,737.4
1,122.3
615.1
494.0
1,745.6
1,128.4
617.1
493.5
1,743.2
1,124.0
619.2
495.6
1.760.5
1,135.7
624.8
497.3
1,767.2
1,139.8
627.4
500.7
1,747.6
1.129.9
617.7
500.7
1,756.4
1,136.2
620.2
500.4
1,705.5
1,118.2
587.3
489.5
I. Data in this table also appear in the Board's G.I7 (419) monthly statistical release. For
the ordering address, see the inside front cover. The latest historical revision of the industrial
production index and the capacity utilization rates was released in November 1995. See "A
Revision to Industrial Production and Capacity Utilization, 1991-95." Federal Reserve
Bulletin, vol. 82 (January 1996). pp. 16-25. For a detailed description of the industrial
production index, see "Industrial Production: 1989 Developments and Historical Revision,"
Federal Reserve Bulletin, vol. 76, (April 1990), pp. 187-204.
2. Standard industrial classification.
Selected Measures
2.14
A49
HOUSING A N D C O N S T R U C T I O N
Monthly figures at seasonally adjusted annual rates except as noted
1995
Item
1992
1993
1994
Jan.
Mar.
Feb.
Apr.
May
June
July
Aug.1"
Sept.r
Oct.
Private residential real estate activity (thousands of units except as noted)
N E W UNITS
1 Permits authorized
1
One-family
3
Two-familv or more
4 Started
5
One-family
6
Two-family or more
7 Under construction at end of period1
8
One-family
9
Two-family or more
10 Completed
1 1 One-familv
12
Two-family or more
13 Mobile homes shipped
1.095
911
184
1,200
1,030
170
612
473
140
1.158
964
194
210
1,199
987
213
1,288
1,126
162
680
543
137
1.193
1,040
153
254
1.372
1,068
303
1,457
1,198
259
762
558
204
1.347
1,160
187
304
1,293
990
303
1,366
1.055
311
792
578
214
1.436
1,209
227
361
1,282
931
351
1,319
1,048
271
797
579
218
1,302
1,080
222
335
1,235
911
324
1,238
987
251
769
552
217
1,443
1,222
221
333
1,243
905
338
1,269
1,009
260
763
544
219
1.334
1,089
245
318
1,243
930
313
1,282
988
294
755
536
219
1,342
1.072
270
329
1,275
958
317
1,298
1,034
264
756
534
222
1,256
1,053
203
329
1,355
1,011
344
1,432
1,107
325
761
538
223
1.345
1,037
308
319
1,368
1.044
324
1,392
1.126
266
773
548
225
1,246
1,012
234
335
1.405
1,073
332
1,389
1,121
268
782
555
227
1.253
993
260
346
1,395
1,059
336
1.337
1,099
238
787
563
224
1.298
1,027
271
n.a.
Merchant builder activity in
one-family units
14 Number sold
15 Number for sale at end of period1
610
265
666
293
670
338
643
342
575
347
612
347
607
348
667
347
723
347
781'
344'
699
347
692
350
673
360
121.3
144.9
126.1
147.6
130.4
153.7
127.9
147.4
135.0
160.2
130.0
153.3
134.0
157.8
133.9
158.0
133.7
160.2
131.0r
154.2'
134.5
160.8
129.1
157.1
133.4
153.4
18 Number sold
3.520
3,800
3,946
3,610
3,420
3,620
3,390
3,550
3,800
3,990
4,120
4.150
4,110
Price of units sold (thousands
of dollars)'
19 Median
20 Average
103.6
130.8
106.5
133.1
109.6
136.4
108.1
135.3
107.0
133.4
107.9
134.5
108.1
134.2
109.0
135.4
116.2
143.3
115.9
142.2
117.6
144.4
115.2
140.5
113.3
138.7
Price of units sold (thousands
of dollars)'
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
435,022
464,504
506,904
521,054
521,429
523,467
522,094
514,515
518,934
528,185
526,535
532,278
546,869
??
315.695
187.870
127,825
20,720
41,523
21.494
44,088
339,161
210,455
128,706
19,533
42,627
23,626
42,920
376,566
238,884
137,682
21,121
48,552
23,912
44,097
384,806
241,938
142,868
22.715
53,338
24,373
42,442
383,652
240,207
143,445
23,370
53,687
24,039
42,349
383,301
237,894
145,407
23,911
55,439
23,062
42,995
382,220
234.109
148,111
24.707
55,011
23,948
44,445
376,148
231,342
144,806
24,760
51,779
24,319
43,948
377,486
228,388
149,098
24,416
55,420
23,447
45.815
385,233
232,415
152,818
24,424
56,906
24,463
47,025
383,556
232,254
151,302
24,178
55,709
24,021
47.394
384,927
235.594
149,333
24,073
55,179
24,020
46,061
390,927
237,381
153,546
25.315
57,523
24,780
45,928
119,322
2,502
34,899
6,021
75,900
125,342
2.454
37,431
5,978
79,479
130,337
2,319
39,882
6,228
81,908
136.248
2,925
38,574
6,681
88,068
137,777
2,624
38,681
7,128
89,344
140.166
3,048
40,667
7,139
89,312
139,874
2,736
41,158
6,273
89,707
138,367
2,442
38.657
5,531
91,737
141,447
2,569
40,875
6,117
91,886
142,952
3,212
44,204
5,326
90,210
142.979
3,025
42,929
6,773
90,252
147.351
2,304
43,064
6.499
95.484
155,942
3,600
46,047
7.341
98,954
23
74
25
26
27
28
Residential
Nonresidential
Industrial buildings
Commercial buildings
Other buildings
Public utilities and other
29 Public
30
Military
31
Highway
32
Conservation and development
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 Bureau of the Census in its estimating techniques.
For a description of these changes, see Construction Reports (C-30-76-5), issued by the
Census Bureau in July 1976.
SOURCE. Bureau of the Census estimates for all series except (1) mobile homes, which are
private, domestic shipments as reported by the Manufactured Housing 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 19,000 jurisdictions beginning in 1994.
A50
2.15
Domestic Nonfinancial Statistics • February 1996
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)
1994
1994
Nov.
Change from 1 month earlier
1995
Index
level,
Nov.
1995 1
1995
1995
Nov.
Dec.
Mar.
June
Sept.
July
Aug.
Sept.
Oct.
Nov.
CONSUMER PRICES 2
(1982-84=100)
1 All items
2.7
2.6
1.9
3.2
3.2
1.8
.2
.1
.1
.3
.0
153.6
2 Food
3 Energy items
4 All items less food and energy
Commodities
5
Services
6
2.4
1.9
2.8
1.5
3.5
2.8
-2.7
3.0
1.7
3.6
3.9
.4
2.0
.3
2.6
.0
-1.1
4.1
2.6
4.8
3.6
5.4
3.0
.6
4.3
3.6
-11.5
2.8
2.3
3.0
.2
-.8
.2
.1
.3
.2
-.8
.2
.4
.1
.5
-1.4
.2
.1
.3
.3
.4
.3
.2
.3
-.1
-.9
.1
.0
.2
149.4
102.8
163.0
140.7
175.7
7 Finished goods
8
Consumer foods
9
Consumer energy
10
Other consumer goods
11
Capital equipment
1.3
.2
2.0
1.5
1.7
2.0
3.2
-3.2
2.8
2.4
2.2
9.2
.0
.6
-.3
3.2
-1.2
11.3
2.9
3.0
.6
-4.6
1.5
3.2
1.8
1.3
8.8
-14.3
2.3
2.1
.1
l.0 r
-2.5r
.2
,2r
-.1
,l r
-,8r
.1
,2r
.3
1.0
-.5
.3
.1
-.1
.0
-.9
.1
-.1
.5
1.2
-.5
.4
.4
128.6
130.9
75.2
143.6
138.0
Intermediate materials
12 Excluding foods and feeds
13 Excluding energy
4.1
4.8
3.3
4.1
7.2
8.3
10.6
10.5
3.9
4.2
-.6
1.8
-,lr
.3
,0r
.1
-.1
.1
-.4
-.3
-.1
-.2
125.3
135.5
-8.9
-6.9
15.7
13.4
-1.4
-1.5
-1.2
-7.6
27.9
-4.6
-4.5
21.9
-.8
14.6
4.6
42.3
-22.0
-18.2
4.l r
-4.6r
- I.8 r
,8r
—4.5r
-I.r
4.2
3.2
-2.1
2.1
-.4
-2.6
3.6
2.1
-2.1
113.9
68.3
161.7
PRODUCER PRICES
(1982=100)
Crude materials
14
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.
SOURCE. U.S. Department of Labor, Bureau of Labor Statistics.
Selected Measures
2.16
A51
GROSS DOMESTIC P R O D U C T A N D INCOME
Billions of current dollars except as noted; quarterly data at seasonally adjusted annual rates
1995
1994
Account
1992
1993
1994
Q3
Q4
Ql
Q2
Q3
G R O S S DOMESTIC PRODUCT
6,020.2
6,343.3
6,738.4
6,791.7
6,897.2
6,977.4
7,030.0
7,113.2
4.136.9
492.7
1.295.5
2,348.7
4,378.2
538.0
1,339.2
2,501.0
4.628.4
591.5
1,394.3
2,642.7
4.657.5
591.5
1,406.1
2,659.9
4.734.8
617.7
1,420.7
2,696.4
4,782.1
615.2
1,432.2
2,734.8
4,851.0
620.3
1,446.2
2,784.5
4,898.1
632.4
1,449.1
2,816.6
6 Gross private domestic investment
7
Fixed investment
8
Nonresidential
9
Structures
Producers' durable equipment
10
11
Residential structures
788.3
785.2
561.4
171.1
390.3
223.8
882.0
866.7
616.1
173.4
442.7
250.6
1.032.9
980.7
697.6
182.8
514.8
283.0
1,055.1
992.5
709.1
184.6
524.5
283.4
1,075.6
1,020.8
732.8
192.0
540.7
288.0
1,107.8
1,053.3
766.4
198.6
567.8
286.8
1,094.1
1.056.9
779.3
204.3
575.0
277.6
1.113.4
1,074.5
788.0
207.6
580.4
286.5
12
1.3
Change in business inventories
Nonfarm
3.0
-2.7
15.4
20.1
52.2
45.9
62.6
53.4
54.8
47.4
54.5
54.1
37.2
37.9
38.9
43.5
14 Net exports of goods and services
15
Exports
16
Imports
-30.3
638.1
668.4
-65.3
659.1
724.3
-98.2
718.7
816.9
-109.6
730.5
840.1
-98.9
765.5
864.4
- 1 1 1.1
778.8
889.9
-124.7
797.5
922.2
-118.3
802.0
920.3
17 Government purchases of goods and services
18
Federal
19
State and local
1.125.3
449.0
676.3
1.148.4
443.6
704.7
1,175.3
437.3
738.0
1,188.8
444.3
744.5
1,185.8
431.9
753.8
1,198.7
434.4
764.3
1.209.6
434.7
774.8
1,220.1
436.8
783.3
By major type of product
20 Final sales, total
2.1
Goods
22
Durable
23
Nondurable
74
Services
Structures
25
6,017.2
2.292.0
968.6
1.323.4
3,227.2
498.1
6,327.9
2.390.4
1,032.4
1,358.1
3,405.5
532.0
6,686.2
2.532.4
1,118.8
1.413.6
3.576.2
577.6
6.729.1
2,543.6
1,125.8
1,417.8
3,603.6
581.9
6,842.4
2,603.3
1,151.8
1,451.5
3,641.9
597.3
6,922.9
2.638.1
1.175.0
1,463.1
3,680.6
604.3
6,992.8
2,650.0
1,178.6
1,471.4
.3,741.0
601.8
7,074.3
2,682.5
1,201.7
1,480.8
3,777.3
614.6
3.0
-13.0
16.0
15.4
8.6
6.7
52.2
34.8
17.4
62.6
44.1
18.5
54.8
36.3
18.5
54.5
48.0
6.5
37.2
28.3
8.9
38.9
26.3
12.6
4,979.3
5,134.5
5,344.0
5,367.0
5,433.8
5,470.1
5,487.8
5,544.6
4,829.5
5,131.4
5,458.4
5,494.9
5,599.4
5,688.4
5,719.4
n.a.
1 Total
2
.3
4
5
By source
Personal consumption expenditures
Durable goods
Nondurable goods
Services
26 Change in business inventories
27
Durable goods
28
Nondurable goods
MEMO
29 Total GDP in 1987 dollars
N A T I O N A L INCOME
30 Total
31 Compensation of employees
32
Wages and salaries
Government and government enterprises
33
34
Other
35
Supplement to wages and salaries
36
Employer contributions for social insurance
37
Other labor income
.38 Proprietors' income1
39
Business and professional 1
40
Farm
3,591.2
2.954.8
567.3
2,387.5
636.4
307.7
328.7
3,780.4
3,100.8
583.8
2,517.0
679.6
324.3
355.3
4.004.6
3,279.0
602.8
2.676.2
725.6
344.6
381.0
4,023.7
3,293.9
604.4
2,689.6
729.7
346.0
383.7
4,095.3
3,356.4
609.0
2,747.4
738.9
350.2
388.7
4,157.3
3,403.4
617.2
2,786.2
753.9
354.3
399.6
4,183.0
3,422.3
620.3
2,802.0
760.8
356.8
403.9
4.230.9
3,462.7
624.4
2,838.2
768.2
360.4
407.8
418.7
374.4
44.4
441.6
404.3
37.3
473.7
434.2
39.5
467.0
437.1
29.8
485.7
444.0
41.7
493.6
449.2
44.4
487.2
452.2
35.0
492.3
458.3
34.0
41 Rental income of persons -
-5.5
24.1
27.7
32.6
29.0
25.4
24.2
20.5
42 Corporate profits'
43
Profits before tax"
44
Inventory valuation adjustment
45
Capital consumption adjustment
405.1
395.9
-6.4
15.7
485.8
462.4
-6.2
29.5
542.7
524.5
-19.5
37.7
556.0
538.1
-19.6
37.5
560.3
553.5
-32.1
38.8
569.7
570.6
-39.0
38.1
581.1
574.1
-28.2
35.2
n.a.
n.a.
-7.4
35.4
46 Net interest
420.0
399.5
409.7
415.7
429.2
442.4
444.0
n.a.
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 1996
PERSONAL INCOME A N D SAVING
Billions of current dollars except as noted; quarterly data at seasonally adjusted annual rates
1994
Account
1992
1995
1993
Q3
Q4
Q3
Q2
Ql
PERSONAL INCOME AND SAVING
1
5,154.3
Total personal income
Wage and salary disbursements
Commodity-producing industries
Manufacturing
Distributive industries
5
6
Service industries
Government and government enterprises
7
2
3
4
8
9
10
11
12.
13
14
15
16
17
Other labor income
Proprietors' income'
Business and professional'
Farm'
Rental income of persons"
Dividends
Personal interest income
Transfer payments
Old-age survivors, disability, and health insurance benefits
LESS; Personal contributions for social insurance
5,701.7
5,734.5
5,856.6
5,962.0
6,008.1
6,075.8
3,080.8
773.8
588.4
701.9
1,021.4
583.8
3,279.0
818.2
617.5
748.5
1,109.5
602.8
3,293.9
821.8
618.3
753.5
1,114.3
604.4
3,356.4
837.3
629.5
769.6
1,140.5
609.0
3,403.4
848.5
638.1
776.8
1,160.9
617.2
3,422.3
842.0
629.6
782.9
1,177.0
620.3
3,462.7
846.6
631.9
795.4
1,196.3
624.4
328.7
418.7
374.4
44.4
-5.5
161.0
665.2
860.2
414.0
355.3
441.6
404.3
37.3
24.1
181.3
637.9
915.4
444.4
381.0
473.7
434.2
39.5
27.7
194.3
664.0
963.4
473.5
383.7
467.0
437.1
29.8
32.6
196.9
674.2
969.0
476.5
388.7
485.7
444.0
41.7
29.0
202.7
701.1
979.7
483.1
399.6
493.6
449.2
44.4
25.4
205.5
723.6
1,004.8
496.7
403.9
487.2
452.2
35.0
24.2
208.1
739.3
1,018.6
503.4
407.8
492.3
458.3
34.0
20.5
211.6
748.3
1,031.0
508.3
248.7
261.3
281.4
282.9
286.6
293.8
295.4
298.4
6,075.8
5,154.3
18 EQUALS: Personal income
19
5,375.1
2,974.8
757.6
578.3
682.3
967.6
567.3
LESS: Personal tax and nontax payments
5,375.1
5,701.7
5,734.5
5,856.6
5,962.0
6,008.1
648.6
686.4
742.1
744.1
754.7
777.6
807.0
807.0
4,505.8
4,688.7
4,959.6
4,990.3
5,101.9
5,184.4
5,201.0
5,268.8
LESS: Personal outlays
4,257.8
4,496.2
4,756.5
4,787.0
4,869.3
4,920.7
4,994.9
5,045.9
2 2 EQUALS: Personal saving
247.9
192.6
203.1
203.3
232.6
263.7
206.1
222.9
19,489.7
13,110.4
14,279.0
19,878.8
13,390.8
14,341.0
20,475.8
13,715.4
14,696.0
20,536.5
13.716.6
14,697.0
20,739.8
13,853.5
14,927.0
20,836.3
13,880.1
15,048.0
20,858.6
13,965.7
14,973.0
21,023.3
14,033.4
15,095.0
5.5
4.1
4.1
4.1
4.6
5.1
4.0
4.2
2 0 EQUALS: Disposable personal income
21
MEMO
23
24
25
Per capita (1987 dollars)
Gross domestic product
Personal consumption expenditures
Disposable personal income
26
Saving rate (percent)
27
Gross saving
722.9
787.5
920.6
922.6
950.3
1,006.0
983.8
n.a.
28
Gross private saving
980.8
1,002.5
1,053.5
1,052.7
1,082.7
1,126.4
1,090.0
n.a.
2.9
30
31
Personal saving
Undistributed corporate profits'
Corporate inventory valuation adjustment
247.9
94.3
-6.4
192.6
120.9
-6.2
203.1
135.1
-19.5
203.3
139.5
-19.6
232.6
130.7
-32.1
263.7
132.6
-39.0
206.1
140.8
-28.2
n.a.
32
33
Capital consumption
Corporate
Noncorporate
396.8
261.8
407.8
261.2
432.2
283.1
432.6
277.3
438.0
281.3
445.3
284.7
454.7
288.4
461.0
292.0
-257.8
-282.7
24.8
-215.0
-241.4
26.3
-132.9
-159.1
26.2
-130.1
-154.0
23.9
-132.3
-161.1
28.8
-120.4
-148.6
28.2
-106.2
-129.6
23.4
G R O S S SAVING
-7.4
allowances
35
36
Government surplus, or deficit ( —), national income and
product accounts
Federal
State and local
37
Gross investment
731.7
789.8
889.7
901.5
907.9
947.4
916.8
38
39
Gross private domestic investment
Net foreign investment
788.3
-56.6
882.0
-92.3
1,032.9
-143.2
1,055.1
-153.6
1,075.6
-167.7
1,107.8
-160.4
1,094.1
-177.3
40
Statistical discrepancy
2.3
-30.9
-21.1
-42.4
-58.6
-67.0
34
222.9
1. With inventory valuation and capital consumption adjustments.
2. With capital consumption adjustment.
8.8
SOURCE. U.S. Department of Commerce, Survey of Current Business.
n.a.
n.a.
n.a.
n.a.
1,113.4
n.a.
n.a.
Summary Statistics
3.10
U.S. INTERNATIONAL T R A N S A C T I O N S
A53
Summary
Millions of dollars; quarterly data seasonally adjusted except as noted1
1994
Item credits or debits
1992
1995
1994
1993
Q3
1 Balance on current account
2
Merchandise trade balance 2
3
Merchandise exports
4
Merchandise imports
5
Military transactions, net
6
Other service transactions, net
7
Investment income, net
8
U.S. government grants
Y
U.S. government pensions and other transfers
10
Private remittances and other transfers
-61,548
-96,106
440,352
-536,458
-2,142
58,767
10,080
-15,083
-3,735
-13,330
Q4
QL
Q2
Q3 P
-39,025
-45,050
138,061
-183,111
542
15,068
-1,961
-2,867
-782
-3,975
-43,267
-48,802
142,850
-191,652
587
14,782
-2,614
-2,284
-989
-3,947
-39,482
-43,433
145,315
-188,748
736
15,178
-4,153
-2,834
-987
-3,989
-99,925
-132,618
456,823
-589,441
448
57,328
9,000
-16,311
-3,785
-13,988
-151,245
-166,099
502,485
-668,584
2,148
57,739
-9,272
-15,814
-4,247
-15,700
-39,714
-44,627
127,384
-172,011
1,124
14,696
-2,533
-3,488
-1,064
-3,822
-43,277
-43,488
133,926
-177,414
679
15,342
-4,571
-6,245
-1,063
-3,931
11 Change in U.S. government assets other than official
reserve assets, net (increase, - )
-1,661
-330
-322
-283
-931
-152
-180
136
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
3,901
0
2,316
-2,692
4,277
-1,379
0
-537
-44
-797
5,346
0
-441
494
5,293
-165
0
-111
273
-327
2,033
0
-121
-27
2,181
-5,318
-867
-526
-3,925
-2,722
0
-156
-786
-1,780
-1,893
0
362
-991
-1,264
-68,115
20,895
45
-46,415
-42,640
-182,880
29,947
1,581
-141,807
-72,601
-130,875
915
-32,621
-49,799
-49,370
-27,492
1,590
-8,051
-10,976
-10,055
-56,258
-16,651
-12,449
-15,238
-11,920
-69,873
-29,284
-11,518
-6,567
-22,504
-97,340
-39,982
-18,499
-21,731
-17,128
-41,095
14,851
40,466
18,454
3,949
2,180
16,571
-688
72,146
48,952
4,062
1,706
14,841
2,585
39,409
30,723
6,025
2,211
2,923
-2,473
19,691
16,477
2,222
494
1,298
-800
-421
7,470
1,228
692
-9,856
45
22,308
10,131
1,126
-154
10,940
265
37,836
25,169
1,326
506
7,886
2,949
39,479
20,597
518
194
18,398
-228
113,357
15,461
13,573
36,857
29,867
17,599
176,382
20,859
10,489
24,063
79,864
41,107
251,956
114,396
-4,324
33,811
58,625
49,448
60,045
19.650
487
5,428
14,762
19,718
85,136
34,676
-5,242
25,929
10,195
19,578
72,533
-531
10,113
29,910
15,816
17,225
86,495
12,239
10,527
30,315
20,549
12,865
66,185
-19,958
0
-26,399
0
35,985
0
-14,269
-26,399
35,985
-14,269
0
-12,082
-6,641
-5,441
0
13,718
782
12,936
0
19,527
6,183
13,344
0
19,178
331
18,847
0
-23,330
-7,086
-16,244
17 Change in U.S. private assets abroad (increase, - )
18
Bank-reported claims'
19
Nonbank-reported claims
20
U.S. purchases of foreign securities, net
21
U.S. direct investments abroad, net
22 Change in foreign official assets in United States (increase, + )
23
U.S. Treasury securities
24
Other U.S. government obligations
Other U.S. government liabilities 4
25
26
Other U.S. liabilities reported by U.S. banks 1
27
Other foreign official assets 5
28 Change in foreign private assets in United States (increase, + )
29
U.S. bank-reported liabilities'
30
U.S. nonbank-reported liabilities
Foreign private purchases of U.S. Treasury securities, net
31
32
Foreign purchases of other U.S. securities, net
Foreign direct investments in United States, net
33
34 Allocation of special drawing rights
35 Discrepancy
36
Due to seasonal adjustment
37
Before seasonal adjustment
0
-34,251
-21,695
36,778
30,024
19,341
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)
3,901
-1,379
5,346
-165
2,033
-5,318
-2,722
-1,893
38,286
70,440
37,198
19,197
-1,113
22,462
37,330
39,285
5,942
-3,717
-1,184
3,564
1,120
-322
1. Seasonal factors are not calculated for lines 12-16, 18-20, 22-34, and 38-40.
2. Data are on an international accounts basis. The data differ from the Census basis data,
shown in table 3.11, for reasons of coverage and timing. Military exports are excluded from
merchandise trade data and are included in line 5.
3. Reporting banks include all types of depository institutions as well as some brokers and
dealers.
-II
6,365
4. Associated primarily with military sales contracts and other transactions arranged with
or through foreign official agencies.
5. Consists of investments in U.S. corporate stocks and in debt securities of private
corporations and state and local governments.
SOURCE. U.S. Department of Commerce, Bureau of Economic Analysis, Survey of Current
Business.
A54
3.11
International Statistics • February 1996
U.S. FOREIGN TRADE 1
Millions of dollars; monthly data seasonally adjusted
1995
Item
1992
1993r
1994'
Apr.
May
June
July
Aug.
Sept.
-106,214
-166,101
59.887
-11,076
-16,336
5,260
-10,780
-15,976
5.196
-11,280
-16,493
5,213
-11,186
-16,230
5,044
-8,359
-13.504
5,145
Oct.p
-8,349
-13,705
5,356
3
1 Goods and services, balance
Merchandise
Services
-39,480
-96,106
56,626
— 74,842
— 132.618
57.777
4 Goods and services, exports
5
Merchandise
6
Services
618,969
440,352
178,617
644,579
456,824
187,755
701.200
502.484
198,716
64.412
47,157
17,255
65,595
48,307
17,288
64,599
47.381
17,218
63,408
46,368
17,040
66,190
49,084
17,106
67,244
49,858
17,386
7 Goods and services, imports
8
Merchandise
9
Services
-658,449
-536,458
- 121,991
-719,421
-589,442
-129,979
-807,414
-668,585
-1.38.829
-75,488
-63.493
-11,995
-76,375
-64,283
-12,092
-75,879
-63,874
-12,005
-74.594
-62,598
-11,996
-74,549
-62,588
-11,961
-75,593
-63,563
-12.030
I. Data show monthly values consistent with quarterly figures in the U.S. balance of
payments accounts.
3.12
n.a.
SOURCE. FT900, U.S. Department of Commerce, Bureau of the Census and Bureau of
Economic Analysis.
U.S. RESERVE ASSETS
Millions of dollars, end of period
1995
Asset
1992
1993
1994
Apr.
1 Total
May
June
July
Aug.
Sept.
Oct.
Nov.p
71,323
2 Gold stock, including Exchange
Stabilization Fund'
3 Special drawing rights - "
4 Reserve position in International Monetary
Fund"
5 Foreign currencies4
73,442
74,335
88,756
90,549
90,063
91,534
86,648
87,152
86,224
85,755
11.056
8.503
11,053
9,039
11,051
10,039
11.055
11,743
11,054
11,923
11,054
11,869
11,053
11,487
11,053
11,146
11,051
11,035
11,051
10,949
11,050
11,034
1 1,759
40.005
11.818
41.532
12,030
41,215
14,206
51,752
14,278
53,294
14,276
52.864
14,761
54,233
14,470
49,979
14,681
50,385
14,700
49,524
14,572
49,099
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—S717 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.
1. Gold held "under earmark" at Federal Reserve Banks for foreign and international
accounts is not included in the gold stock of the United States; see table 3.13, line 3. Gold
stock is valued at $42.22 per fine troy ounce.
2. Special drawing rights (SDRs) are valued according to a technique adopted by the
International Monetary Fund (IMF) in July 1974. Values are based on a weighted average of
exchange rates for the currencies of member countries. From July 1974 through December
1980, sixteen currencies were used; since January 1981, tive currencies have been used. U.S.
3.13
FOREIGN OFFICIAL ASSETS HELD AT FEDERAL RESERVE BANKS 1
Millions of dollars, end of period
1995
Asset
1992
1993
1994
Apr.
1 Deposits
Held in custody
2 U.S. Treasury securities3 Earmarked gold
June
July
Aug.
Sept.
Oct.
Nov.p
205
386
250
166
227
167
190
165
201
275
194
314,481
13,118
379,394
12.327
441.866
12.033
469,482
11,897
474,181
11,800
482,506
11,725
505.613
11,728
502,737
11,728r
506,572
11,728
507,075
11,709
522,950
11,702
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, in each case measured at face (not market) value.
May
3. Held in foreign and international accounts and valued at $42.22 per fine troy ounce; not
included in the gold stock of the United States.
Summary Statistics
3.15
A55
SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS
Millions of dollars, end of period
1995
Item
1994
1993
Oct.p
Apr.
1 Total1
483,002
June
July
Aug.
552,623
520,578
May
Sept.
560,324
580,073
604,392
612,828
619,419 r
618,095
r
107,646
157,987
By type
Liabilities reported by banks in the United States"
U.S. Treasury bills and certificates1
U.S. Treasury bonds and notes
Marketable
Nonmarketable4
U.S. securities other than U.S. Treasury securities5
2
3
4
5
6
7
8
9
10
11
12
69,808
151,100
73,031
139,570
85,564
146,417
84,859
154,575
91,583
154,517
93,743
159,654
104,745
157,516
110,051
163,093
212,237
5,652
44,205
254,059
6,109
47,809
265,178
6,174
49,290
263,404
6,209
51,277
274,254
6,245
53,474
291,034
6,288
53,673
290,670
6,329
53,568
286,145r
6,366
53,764
291,850
6,407
54,205
By area
Europe1
Canada
Latin America and Caribbean
Asia
Africa
Other countries
207,121
15,285
55,898
197,702
4,052
2,942
215,024
17,235
41,492
236,819
4,179
5,827
216,771
19,248
42,475
266,089
4,200
3,838
217,793
19,631
44,707
270,519
4,281
3,391
223,814
19,549
50,288
278,767
4,427
3,226
224,343
21,746
58,007
290,878
4,309
5,107
221,105
21,508
63,264
297,343
4,433
5,173
222,820
20,522
63,375r
303,809r
4,684
4,207
222.360
20,355
61,244
305,061
4,761
4,312
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 and Treasury bills issued to official
institutions of foreign countries.
4. Excludes notes issued to foreign official nonreserve agencies. Includes current value of
zero-coupon Treasury bond issues to foreign governments as follows: Mexico, beginning
March 1988, 20-year maturity issue and beginning March 1990, 30-year maturity issue;
3.16
LIABILITIES TO, AND CLAIMS ON, FOREIGNERS
Payable in Foreign Currencies
Venezuela, beginning December 1990, 30-year maturity issue; Argentina, beginning April
1993, 30-year maturity issue.
5. Debt securities of U.S. government corporations and federally sponsored agencies, and
U.S. corporate stocks and bonds.
SOURCE. Based on U.S. Department of the Treasury data and on data reported to the
department by banks (including Federal Reserve Banks) and securities dealers in the United
States, and on the 1989 benchmark survey of foreign portfolio investment in the United
States.
Reported by Banks in the United States'
Millions of dollars, end of period
1994
Item
1991
1992
1995
1993
Dec.
1 Banks' liabilities
2 Banks' claims
Deposits
3
4
Other claims
5 Claims of banks' domestic customers2
75,129
73.195
26,192
47,003
3,398
I. Data on claims exclude foreign currencies held by U.S. monetary authorities.
72,796
62,799
24,240
38,559
4,432
78,259
61,425
20,401
41,024
9,103
Mar.
June
Sept.
89,587
60,249
19,640
40,609
15,020
96,190
72,511
24,257
48,254
11,637
106,069
77,195
28,915
48,280
13,070
101,456
69,312
25,668
43,644
9,708
2. Assets owned by customers of the reporting bank located in the United States that
represent claims on foreigners held by reporting banks for the accounts of the domestic
customers.
A56
3.17
International Statistics • February 1996
LIABILITIES TO FOREIGNERS
Payable in U.S. dollars
Reported by Banks in the United States'
Millions of dollars, end of period
1995
Item
1992
1993
1994
Apr.
May
June
July
Aug/
Sept.
Oct."
BY HOLDER AND T Y P E OF LIABILITY
1
Total, all foreigners
810,259
926,793
1,017,047
1,037,624
1,041,439
1,057,301
1,059,317
1,075,744
1,073,134
1,097,070
2
3
4
Banks' own liabilities
Demand deposits
Time deposits Other3
606,444
21,828
160,385
93,237
330 994
627.040
21,573
175.032
112,056
318.379
721.624
23.376
186.400
115,933
395,915
720.976
22,950
182,196
123,852
391 9 7 8
722.735
23,567
184,299
127.544
387.325
735,054
22,226
195,214
122,722
394,892
730,208
24,100
191,739
140,910
373,459
744,997
21,778
196,816
139,068
387 335
734,272
23,750
188,000
136,103
386 419
760,747
23,451
202,048
145,619
389,629
203,815
127,644
299,753
176,739
295,423
162,826
316,648
175,540
318.704
182,046
322,247
182,204
329,109
188,621
330.747
187,318
338,862
193,070
336,323
189,118
21,974
54,197
36.289
86,725
42,177
90,420
48,278
92,830
40,331
96,327
45,112
94,931
44,252
96,236
45,175
98,254
47,254
98,538
47,968
99,237
9,350
6,951
46
3.214
3,691
10.936
5,639
15
2,780
2,844
8,606
8,176
29
3.298
4.849
8,710
7,547
214
3.954
3,379
8,576
7.609
34
3,516
4.059
9,776
8,972
114
4,459
4,399
11,955
10,884
43
4,977
5,864
9,934
8,630
40
4,457
4,133
12,696
11,805
64
4,315
7,426
10,130
8,302
383
3,941
3,978
2.399
1.908
5,297
4,275
430
281
1,163
763
967
510
804
312
1,071
551
1.304
826
891
354
1,828
1,342
486
5
1,022
0
149
0
400
0
456
1
492
0
520
0
478
0
537
0
486
0
159,563
51,202
1,302
17,939
31.961
220,908
64,231
1,601
21,654
40.976
212,601
59,580
1,564
23.511
34,505
231,981
67,999
1,485
25,788
40,726
239,434
68,974
1,575
27,462
39,937
246,100
73.129
1,398
27,426
44,305
253,397
75,379
1,429
29,502
44,448
262,261
83,346
1,547
31,554
50,245
273,144
85,998
1,362
32,048
52,588
265,633
83.284
1,651
30.195
51,438
108,361
104.596
156.677
151.100
153,021
139,570
163,982
146,417
170,460
154,575
172,971
154,517
178,018
159,654
178,915
157,516
187,146
163,093
182,349
157,987
3.726
39
5.482
95
13,245
206
17,473
92
15,771
114
18,325
129
18,159
205
20,735
664
23,777
276
24,108
254
547.320
476,117
145,123
10,170
90,296
44,657
330,994
592.208
478,792
160,413
9,719
105,192
45,502
318,379
680,738
566,647
170,732
10,633
111,156
48.943
395,915
681,438
558,903
166,925
10,701
100,613
55,611
391,978
680,063
560,440
173,115
11,406
103,681
58.028
387,325
685,718
566,247
171,355
10,554
111,674
49,127
394,892
665,934
545,332
171,873
12,121
104,806
54,946
373,459
684,122
562.682
175,347
10,061
108,842
56,444
387,335
670,198
547,615
161,196
11,817
98,868
50,511
386,419
698,123
574,711
185,082
11,338
114.497
59,247
389,629
71,203
11,087
113,416
10,712
114,091
11,219
122,535
15,717
1 19,623
14.437
119,471
15,021
120,602
15,535
121,440
15,489
122,583
16,170
123,412
16,299
7,555
52,561
17,020
85.684
14,234
88.638
15.815
91,003
10,955
94,231
11.188
93,262
10,583
94,484
10,142
95,809
9.665
96,748
9,804
97,309
94,026
72,174
10,310
48.936
12,928
102,741
78,378
10.238
45.406
22.734
115,102
87.221
11,150
48,435
27.636
115.495
86,527
10,550
51,841
24.136
113,366
85,712
10,552
49,640
25,520
115,707
86,706
10,160
51,655
24,891
128,031
98,613
10,507
52,454
35,652
119,427
90,339
10,130
51,963
28,246
117,096
88.854
10,507
52,769
25,578
123.184
94,450
10,079
53,415
30,956
21,852
10,053
24,363
10,652
27,881
1 1,756
28,968
12,643
27.654
12,524
29,001
12,354
29,418
12,881
29,088
13.487
28,242
13.453
28,734
13,490
10,207
1,592
12,765
946
14,549
1.576
14.590
1,735
13,149
1.981
15,107
1,540
14,990
1,547
13,820
1,781
13,275
1.514
13,570
1,674
9,111
17.567
17,895
17.651
11,938
12,158
10,129
10,409
9.915
10,372
6
1 Banks' custodial liabilities
8
9
10
11
12
13
14
1.*)
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
33
36
37
38
39
40
41
42
43
44
45
46
47
48
5
U.S. Treasury bills and certificates'1
Other negotiable and readily transferable
instruments7
Other
8
Nonmonetary international and regional organizations . . .
Banks' own liabilities
Demand deposits
Time deposits"
Other3
Banks' custodial liabilities5
U.S. Treasury bills and certificates6
Other negotiable and readily transferable
instruments7
Other
Official institutions'
Banks' own liabilities
Demand deposits
Time deposits"
Other3
Banks' custodial liabilities
U.S. Treasurv bills and certificates6
Other negotiable and readily transferable
instruments7
Other
Banks'"
Banks' own liabilities
Unaffiliated foreign banks
Demand deposits
Time deposits"
Other3
Own loreign offices4
Banks' custodial liabilities5
U.S. Treasury bills and certificates6
Other negotiable and readily transferable
instruments7
Other
Other foreigners
Banks' own liabilities
Demand deposits
Time deposits"
Other3
Banks' custodial liabilities'
U.S. Treasury bills and certificates6
Other negotiable and readily transferable
instruments7
Other
MEMO
49
Negotiable time certificates of deposit in custody for
foreigners
1. Reporting banks include all types of depository institutions as well as some brokers and
dealers. Excludes bonds and notes of maturities longer than one year.
2. Excludes negotiable time certificates of deposit, which are included in "Other negotiable and readily transferable instruments."
3. Includes borrowing under repurchase agreements.
4. For U.S. banks, includes amounts owed to own foreign branches and foreign subsidiaries consolidated in quarterly Consolidated Reports of Condition filed with bank regulatory
agencies. For agencies, branches, and majority-owned subsidiaries of foreign banks, consists
principally of amounts owed to the head office or parent foreign bank, and to foreign
branches, agencies, or wholly owned subsidiaries of the 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 for foreign customers.
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 InterAmerican 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."
Nonbank-Reported
3.17
Data
A57
LIABILITIES TO FOREIGNERS Reported by Banks in the United States'—Continued
1995
Item
1992
1994
1993
Apr.
May
June
July
Aug.r
Sept.
Oct.p
AREA
5 0 Total, all f o r e i g n e r s
810,259
926,793
1,017,047
1,037,624
1,041,439
1,057,301
1,059,317
1,075,744
1,073,134
1,097,070
51 F o r e i g n c o u n t r i e s
800,909
915,857
1,008,441
1,028,914
1,032,863
1,047,525
1,047,362
1,065,810
1,060,438
1,086,940
52 Europe
Austria
53
54
Belgium and Luxembourg
55
Denmark
56
Finland
57
France
58
Germany
59
Greece
Italy
60
Netherlands
61
62
Norway
Portugal
63
64
Russia
Spain
65
66
Sweden
67
Switzerland
68
Turkey
69
United Kingdom
70
Yugoslavia"
71
Other Europe and other former U.S.S.R.1"
307,670
1,611
20,567
3,060
1,299
41,411
18,630
913
10,041
7,365
3,314
2,465
577
9,793
2,953
39,440
2,666
111,805
504
29,256
378,107
1,917
28,670
4,517
1,872
40,316
26,685
1,519
11,759
16,096
2,966
3,366
2,511
20,493
2,738
41,561
3,227
133,993
570
33,331
392,931
3,649
21,978
2,784
1,436
45,207
27,190
1,393
10,882
15,971
2,338
2,846
2,714
14,655
3,093
41,881
3,341
163,768
245
27,760
368,495
4,030
22,855
2,567
2,028
38,668
28,496
2,195
9,414
12,545
1,374
2,940
5,011
9,859
1,845
41,258
3,624
153,431
219
26,136
377,387
3,961
25,734
2,811
1,708
40,976
31,968
2,160
9,810
14,622
1,289
2,855
7,042
9,780
1,437
39,984
3,187
151,052
220
26,791
374,702
3,854
21,078
2,432
1,455
45,034
34,342
2,351
10,371
11,449
1,305
2,674
7,177
10,532
3,471
47,243
3,255
141,110
220
25,349
377.555
3,923
24,793
2,131
2,390
42,870
33,790
2,297
10,218
11,743
1,119
3,164
6,313
9,089
2,187
42,192
2,972
151,339
214
24,81 I
376,475
3,869
24,591
2,468
2,270
43,309
31,256
2,398
10,813
10,685
2,087
2,933
7,265
9,973
2,876
41,644
3,523
150,781
146
23,588
361,949
5,221
24,036
2,476
1,972
38,096
31,388
2,1 19
8.937
13,106
1,011
3,033
6,367
10,060
3,143
41,376
3,936
141,572
215
23,885
376,384
4,887
25,102
3,177
2,419
43,022
26,342
2,032
10,224
15,602
1,048
2,901
7,338
13,409
1,989
42,440
4,066
147,485
210
22.691
22,420
20,235
24,627
28,563
27,716
29,451
28,888
28,296
28,847
35,356
317.228
9,477
82,284
7,079
5,584
153,033
3,035
4,580
3
993
1,377
371
19,454
5,205
4,177
1,080
1,955
11,387
6,154
362,161
14,477
73,800
8,117
5,301
193,649
3,183
3,171
33
880
1,207
410
28,018
4,686
3,582
926
1,611
12,786
6,324
422,781
17,199
103,684
8,467
9,140
229,620
3,114
4,579
13
873
1,121
529
12,244
4,530
4,542
899
1,594
13,975
6,658
431,632
10,154
97,304
8,955
13,114
244,233
3,446
3,598
6
1,054
1,094
422
17,246
4,076
4,816
931
1,930
12,122
7,131
429,741
10,210
92,324
8,617
15,563
242,895
2,911
3,401
5
1,048
1.069
542
18,174
6,001
4,881
1,004
2,091
12,041
6,964
444,638
10,806
97,244
7,156
18,242
252,372
3,304
3,273
5
1,179
1,128
449
19,172
4,626
4,297
996
2,029
11,187
7,173
435,628
12,336
88,580
6,907
21,224
245,018
2,661
3,429
5
1,118
1,099
426
20,977
6,066
4.624
943
1,951
11,419
6,845
447,310
11,538
95,808
6,873
26,743
244,228
2,890
3.349
3
1,160
1,122
444
22,120
4,778
4,998
1,028
1,937
11,193
7,098
434,034
11,179
92,583
6,073
27,591
234.579
2,698
3,257
4
1,130
1,197
484
22,063
5,016
4,678
909
1,839
11,963
6,791
439,407
11,525
96,002
6,661
27,316
236,032
2,573
3,397
13
1,311
1,068
430
20,879
5,328
4,462
897
1,842
12,626
7,045
143,540
144,529
155,556
187,634
186,272
188,284
192,175
199,607
222,981
222,269
3,202
8,408
18,499
1,399
1,480
3,773
58,435
3,337
2,275
5,582
21,437
15,713
4,011
10,627
17,132
1,114
1,986
4,435
61,466
4,913
2,035
6,137
15,824
14,849
10,066
9,826
17,087
2,338
1,587
5,155
64,259
5,124
2,714
6,466
15,475
15,459
12,138
9,630
20,069
2,194
1,696
5,411
84,761
4,760
2,257
10,416
15,730
18,572
9,459
9,137
22,690
1,939
2,331
5,326
83,174
5,030
2,704
11,582
15,612
17,288
10,579
9,740
23,031
2,104
2,115
4,570
83,348
4,982
2,538
11,497
16,865
16,915
11,908
9,152
25,124
2,269
1,962
4,596
85,801
5,061
2,652
11,239
16,468
15,943
13,208
9,838
24,152
2,745
2,175
4,723
89,102
4,881
2,793
11,177
15,779
19,034
22,273
10,253
21,852
2,914
2,366
4,207
104,261
5,443
2,786
11,803
16,892
17,931
22.351
10,722
21,848
3,001
2,172
3,812
103,967
5,332
2,840
10,456
17,350
18.418
105 A f r i c a
106
Egypt
Morocco
107
108
South Africa
109
Zaire
110
Oil-exporting countries14
Other
111
5,884
2,472
76
190
19
1,346
1,781
6,633
2,208
99
451
12
1,303
2,560
6,511
1,867
97
433
9
1,343
2,762
6,583
2,102
66
401
12
1,328
2,674
6,707
2,045
72
539
10
1,302
2,739
6,779
2,143
90
594
18
1,418
2,516
6,962
1,840
94
1,000
13
1,364
2,651
6,989
1,924
87
746
15
1,667
2,550
7,033
2,127
79
467
9
1,792
2,559
7,209
1,948
66
934
4
1,544
2,713
112 O t h e r
Australia
113
Other
114
4,167
3,043
1,124
4,192
3,308
884
6,035
5,141
894
6,007
4,912
1,095
5,040
4,255
785
3,671
2,944
727
6,154
5,472
682
7,133
5,459
1,674
5,594
4,777
817
6,315
5,007
1,308
115 N o n m o n e t a r y i n t e r n a t i o n a l a n d r e g i o n a l o r g a n i z a t i o n s . . .
International15
1 16
Latin American regional16
117
Other regional17
118
9,350
7,434
1,415
501
10,936
6,851
3,218
867
8,606
7,537
613
456
8,710
7,173
666
871
8,576
6,597
1,067
912
9,776
8,124
804
848
11,955
10,266
834
855
9,934
7,918
1,010
1,006
12,696
10,964
876
856
10,130
8,294
552
1,284
72 Canada
73 Latin America and Caribbean
74
Argentina
Bahamas
75
76
Bermuda
77
Brazil
78
British West Indies
79
Chile
80
Colombia
81
Cuba
Ecuador
82
Guatemala
83
84
Jamaica
Mexico
85
Netherlands Antilles
86
87
Panama
88
Peru
89
Uruguay
90
Venezuela
Other
91
92 Asia
China
P e o p l e ' s Republic of C h i n a
93
94
Republic of C h i n a (Taiwan)
Hong Kong
95
96
India
Indonesia
97
98
Israel
Japan
99
Korea (South)
100
Philippines
101
102
Thailand
Middle Eastern oil-exporting countries1'
103
104
Other
11. S i n c e D e c e m b e r 1992, h a s e x c l u d e d B o s n i a , C r o a t i a , a n d S l o v e n i a .
12. I n c l u d e s t h e B a n k f o r I n t e r n a t i o n a l S e t t l e m e n t s . S i n c e D e c e m b e r 1 9 9 2 , h a s
i n c l u d e d all p a r t s o f t h e f o r m e r U . S . S . R . ( e x c e p t R u s s i a ) , a n d B o s n i a , C r o a t i a , a n d S l o v e n i a .
13. C o m p r i s e s B a h r a i n , I r a n , I r a q , K u w a i t , O m a n , Q a t a r , S a u d i A r a b i a , a n d U n i t e d A r a b
Emirates (Trucial States).
14. C o m p r i s e s A l g e r i a , G a b o n , L i b y a , a n d N i g e r i a .
15. P r i n c i p a l l y t h e I n t e r n a t i o n a l B a n k f o r R e c o n s t r u c t i o n a n d D e v e l o p m e n t . E x c l u d e s
" h o l d i n g s o f d o l l a r s " of t h e I n t e r n a t i o n a l M o n e t a r y F u n d .
16. P r i n c i p a l l y t h e I n t e r - A m e r i c a n D e v e l o p m e n t B a n k .
17. A s i a n , A f r i c a n , M i d d l e E a s t e r n , a n d E u r o p e a n r e g i o n a l o r g a n i z a t i o n s , e x c e p t the B a n k
f o r I n t e r n a t i o n a l S e t t l e m e n t s , w h i c h is i n c l u d e d in " O t h e r E u r o p e . "
A58
3.18
International Statistics • February 1996
BANKS' OWN CLAIMS ON FOREIGNERS Reported by Banks in the United States'
Payable in U.S. Dollars
Millions of dollars, end of period
1995
Area or country
1992
1993
1994
Apr.
May
June
July
Aug. r
Sept.
Oct. p
1 Total, all foreigners
499,437
486,250
483,372
480,697
483,947
519,489
506,828
518,721
513,235
519,392
2 Foreign countries
494,355
483,845
478,781
477,760
482,337
516,856
505,511
517,304
510,408
517,734
123,377
331
6,404
707
1,418
14,723
4,222
717
9,047
2,468
355
325
3,147
2,755
4,923
4,717
962
63,430
569
2,157
122,823
413
6,532
382
594
11,822
7,722
680
8,836
3,063
396
834
2,310
2,800
4,252
6,603
1,301
61,963
536
1,784
124,609
692
6,737
1,030
691
12,767
6,732
592
6,041
2,957
504
938
949
3,529
4,096
7,492
874
66,558
265
1,165
122,538
461
8,505
549
700
13,132
7,156
560
6,209
3,551
1,295
915
657
2,076
3,522
7,398
810
63,642
247
1,153
123,304
756
8,052
508
431
14.083
6,644
407
6,219
5,998
1,382
990
511
2,138
3,319
7,631
722
62,218
248
1,047
128,932
581
5,148
599
394
15,362
7,986
442
6,734
4,356
1,019
1,208
508
3,565
2,939
10,290
713
65,790
229
1,069
125,948
616
8,063
443
967
15,419
6,272
445
6,066
4,478
1,206
987
495
3,626
3,557
7,539
725
63,746
230
1,068
126,617
685
8,250
428
1,001
15,166
7,859
386
5,747
4,354
1,047
916
506
3,482
2,820
7,362
768
64,498
230
1,112
115,505
670
7,051
410
1,221
13,927
7,802
385
5,911
4,721
1,392
986
421
3,520
2,677
7,219
802
54,368
234
1,788
130,356
880
7,017
634
1,916
14,766
7,192
404
5,605
4,469
1,456
1,026
696
3,154
2,604
6,320
830
68,988
233
2,166
3 Europe
4
Austria
Belgium and Luxembourg
5
Denmark
6
Finland
7
France
8
9
Germany
10
Greece
11
Italy
Netherlands
12
13
Norway
14
Portugal
Russia
15
Spain
16
Sweden
17
Switzerland
18
19
Turkey
20
United Kingdom
21
Yugoslavia 2
22
Other Europe and other former U.S.S.R.''
23 Canada
13,845
18,543
18,150
17,482
20,553
19,715
18,870
17,289
18,666
17,796
24 Latin America and Caribbean
25
Argentina
Bahamas
26
27
Bermuda
Brazil
28
29
British West Indies
30
Chile
31
Colombia
32
Cuba
Ecuador
33
Guatemala
34
35
Jamaica
36
Mexico
37
Netherlands Antilles
38
Panama
39
Peru
40
Uruguay
41
Venezuela
Other
42
218,078
4,958
60,835
5,935
10,773
101,507
3,397
2,750
0
884
262
162
14,991
1,379
4,654
730
936
2,525
1,400
223,997
4,473
63,296
8,532
11,845
98,708
3,619
3,179
0
680
288
195
15,713
2,682
2,893
656
969
2,907
3,362
222,541
5,834
66,096
8,381
9,579
95,609
3,794
4,003
0
680
366
258
17,721
1,055
2,179
996
503
1,828
3,659
224,901
6,178
64,352
11,843
10,896
94,155
4,247
3,928
0
565
359
262
17,182
1,333
2,507
1,116
366
1,679
3,933
223,659
6,352
62,297
10,884
11,192
95,284
3,867
4,034
0
663
353
258
17,375
1,778
2,433
1,095
398
1,662
3,734
243,232
6,596
63,287
8,549
11,522
113,870
4,316
4,032
0
767
344
264
17,277
2,881
2,506
1,359
377
1,608
3,677
237,824
6,255
59,446
6,373
12,528
113,951
4,245
4,182
0
767
340
277
17,146
2,730
2,512
1,332
424
1,647
3,669
248,921
6,161
60,421
8,944
12,981
117,416
4,642
4,270
0
725
350
290
16,833
6,313
2,503
1,368
424
1,596
3,684
249,503
6,119
62,436
6,295
13,093
119,524
4,436
4,358
0
805
361
287
16,483
5,602
2,575
1,464
386
1,480
3,799
249,310
6,007
55,471
5,537
13,346
122,061
4,619
4,578
0
846
385
289
16,653
9,233
2,825
1,500
441
1,826
3,693
43
131,789
111,765
107,337
106,749
108,780
118,697
117,198
118,197
120,256
114,523
906
2,046
9,642
529
1,189
820
79,172
6,179
2,145
1,867
18,540
8.754
2,271
2,623
10,826
589
1,527
826
60,029
7,539
1,409
2,170
15,113
6,843
836
1,444
9,159
994
1,470
688
59,425
10,286
660
2,902
13,741
5,732
980
1,534
11,602
1,139
1,463
683
55,191
11,953
496
2,757
13,292
5,659
879
1,519
12,069
1,126
1,427
783
58,475
12,265
532
2,755
11,643
5,307
1,143
1,794
14,894
1,210
1,443
949
61,039
12,617
916
2,688
12,569
7,435
1,206
1,913
14,753
1,732
1,516
748
61,268
13,142
596
2,670
11,946
5,708
1,163
1,600
14,496
1,905
1,620
700
63,288
12,836
623
2,594
11,403
5,969
1,316
1,584
15,677
1,944
1,596
712
63,059
13,028
750
2,594
11,723
6,273
1,241
1,595
12,539
1,924
1,623
886
61,817
13,396
673
2,568
9,963
6,298
4,279
186
441
1,041
4
1,002
1,605
3,857
196
481
633
4
1,129
1,414
3,015
225
429
671
2
842
846
2,741
181
440
584
2
700
834
2,751
237
454
579
2
658
821
2,919
204
686
563
2
657
807
2,907
193
645
531
7
659
872
2,826
194
653
544
2
614
819
2,705
202
647
454
2
615
785
2,783
224
457
604
1
586
911
63 Other
64
Australia
Other
65
2,987
2,243
744
2,860
2,037
823
3,129
2,186
943
3,349
1,768
1,581
3,290
1,877
1,413
3,361
1,999
1,362
2,764
2,072
692
3,454
2,072
1,382
3,773
2,632
1,141
2,966
2,095
871
66 Nonmonetary international and regional organizations 6 . . .
5,082
2,405
4,591
2,937
1,610
2,633
1,317
1,417
2,827
1,658
44
45
46
47
48
49
50
51
52
53
54
55
China
People's Republic of China
Republic of China (Taiwan)
Hong Kong
India
Indonesia
Israel
Japan
Korea (South)
Philippines
Thailand
Middle Eastern oil-exporting countries 4
Other
56
57
58
59
60
61
62
Egypt
Morocco
South Africa
Zaire
Oil-exporting countries 5
Other
1. Reporting banks include all types of depository institutions as well as some brokers and
dealers.
2. Since December 1992, has excluded Bosnia, Croatia, and Slovenia.
3. Includes the Bank for International Settlements. Since December 1992, has included all
parts of the former U.S.S.R. (except Russia), and Bosnia, Croatia, and Slovenia.
4. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab
Emirates (Trucial States).
5. Comprises Algeria, Gabon, Libya, and Nigeria.
6. Excludes the Bank for International Settlements, which is included in "Other Europe."
Nonbank-Reported
3.19
BANKS' OWN A N D DOMESTIC CUSTOMERS' CLAIMS ON FOREIGNERS
Payable in U.S. Dollars
Data
Reported by Banks in the United States'
Millions of dollars, end of period
1995
Type of claim
Apr.
May
480,697
22,193
282,383
104,883
54,970
49,913
71,238
483,947
19,075
285,843
104,005
51,454
52,551
75,024
June
July
Aug.
Sept. r
506,828
19,716
292,026
113,309
59,456
53,853
81,777
518,721 r
21,423
295,929
11 l,578 r
57,386
54,l92 r
89,79 l r
513,235
22,291
296,897
107,011
50,490
56,521
87,036
1 Total
559,495
560,040
580,496
2 Banks' claims
3
Foreign public borrowers
4
Own foreign offices 2
Unaffiliated foreign banks
Deposits
6
7
Other
8
All other foreigners
499,437
31,367
303,991
109,342
61,550
47,792
54,737
486,250
29,004
284,270
100,169
49,186
50,983
72,807
483,372
23,470
282,143
111,494
59,142
52,352
66,265
60,058
15,452
73,790
34,291
97,124
56,649
106,445
58,526
108,860
51,960
31,474
25,819
27,188
31,591
40,192
13,132
13,680
13,287
16,328
16,708
8,655
7,846
8,377
8,500
8,751
38,623
29,287
32,004
Oct. p
9 Claims of banks' domestic customers 3
10
Deposits
11
Negotiable and readily transferable
instruments 4
12
Outstanding collections and other
claims
625,934
519,489
23,772
300,564
112,162
58,583
53,579
82,991
622,095
519,392
20,937
301,464
103,307
46,697
56,610
93,684
MEMO
13 Customer liability on acceptances
14 Dollar deposits in banks abroad, reported by
nonbanking business enterprises in the
United States5
26,429
35,409
34,221
35,133
34,203
n.a.
principally of amounts due from the head office or parent foreign bank, and from foreign
branches, agencies, or wholly owned subsidiaries of the head office or parent foreign bank.
3. Assets held by reporting banks in the accounts of their domestic customers.
4. Principally negotiable time certificates of deposit, bankers acceptances, and commercial
paper.
5. Includes demand and time deposits and negotiable and nonnegotiable certificates of
deposit denominated in U.S. dollars issued by banks abroad.
1. For banks' claims, data are monthly; for claims of banks' domestic customers, data are
for quarter ending with month indicated.
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 quarterly Consolidated Reports of Condition filed with bank regulatory
agencies. For agencies, branches, and majority-owned subsidiaries of foreign banks, consists
3.20
29,437
BANKS' OWN CLAIMS ON UNAFFILIATED FOREIGNERS
Payable in U.S. Dollars
Reported by Banks in the United States'
Millions of dollars, end of period
1994
Maturity, by borrower and area 2
1991
1992
Dec.
1 Total
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
By borrower
Maturity of one year or less
Foreign public borrowers
All other foreigners
Maturity of more than one year
Foreign public borrowers
All other foreigners
By area
Maturity of one year or less
Europe
Canada
Latin America and Caribbean
Asia
Africa
All other 3
Maturity of more than one year
Europe
Canada
Latin America and Caribbean
Asia
Africa
All other 3
Mar.
June r
Sept. p
195,302
195,119
201,611
201,117
198,959
218,572
215,744
162.573
21,050
141,523
32,729
15,859
16,870
163,325
17,813
145,512
31,794
13,266
18,528
171,786
17,763
154,023
29,825
10,880
18,945
175,429
15,557
159,872
25,688
7,670
18,018
170,580
15,749
154,831
28,379
7,689
20,690
190,272
15,917
174,355
28,300
7,726
20,574
183,362
14,307
169,055
32,382
7,721
24,661
51,835
6,444
43,597
51,059
2,549
7,089
53,300
6,091
50,376
45,709
1,784
6,065
57,392
7,673
59,689
41,419
1,820
3,793
58,188
7,360
61,448
40,696
1,371
6,366
54,389
7,417
63,803
38.213
1,223
5,535
60,573
8,210
71,114
44,328
1,443
4,604
51,869
7,765
73,610
44,157
1,259
4,702
3,878
3,595
18,277
4,459
2,335
185
5,367
3,287
15,312
5,038
2,380
410
5,276
2,558
14,007
5,600
1,936
448
3,865
2,495
12,230
4,731
1,553
814
4,496
3,596
13,003
5,215
1,592
477
3,700
3,084
14,116
5,488
1,372
540
4,361
2,795
17,477
5,790
1,372
587
1. Reporting banks include all types of depository institutions as well as some brokers and
dealers.
1995
1993
2. Maturity is time remaining until maturity.
3. Includes nonmonetary international and regional organizations.
A59
A60
3.21
International Statistics • February 1996
CLAIMS ON FOREIGN COUNTRIES
Held by U.S. and Foreign Offices of U.S. Banks 1
Billions of dollars, end of period
1993
Area or country
lyy 1
1994
1995
19yz
Sept.
1 Total
Dec.
Mar.
June
Sept.
Dec.
Mar.
June
Sept.
343.5
344.7
387.4
405.2
476.4
485.6
485.2
496.7
537.6
523.3
519.7
137.5
.0
11.3
8.3
5.6
.0
1.9
3.4
68.4
5.8
22.2
131.3
5.6
15.3
9.1
6.5
2.8
2.3
4.8
59.7
6.3
18.8
152.0
7.1
12.3
12.2
8.7
3.7
2.5
5.6
73.9
9.7
16.4
161.6
7.4
12.0
12.6
7.6
4.7
2.7
5.9
84.2
6.8
17.6
180.3
8.0
16.6
29.9
15.6
4.1
2.9
6.3
69.5
7.8
19.6
174.9
8.6
19.1
25.0
14.0
3.6
3.0
6.5
64.6
9.7
20.7
183.7
9.6
21.2
24.2
11.6
3.5
2.6
6.2
78.4
9.9
16.5
191.7
7.0
19.7
23.8
11.8
3.6
2.7
6.9
85.5
9.7
21.0
207.0
8.3
20.1
30.4
10.6
3.6
3.1
6.2
89.5
10.6
24.5
199.2
7.3
19.3
29.1
10.7
4.3
3.0
6.1
86.5
10.8
22.1
196.9
8.5
17.4
27.7
12.6
3.9
2.7
6.0
82.3
11.8
24.0
13 Other industrialized countries
14
Austria
15
Denmark
16
Finland
17
Greece
18
Norway
19
Portugal
20
Spain
21
Turkey
22
Other Western Europe
23
South Africa
24
Australia
22.8
.6
.9
.7
2.6
1.4
.6
8.3
1.4
1.8
1.9
2.7
24.0
1.2
.9
.7
3.0
1.2
.4
8.9
1.3
1.7
1.7
2.9
26.0
.6
1.1
.6
3.2
2.1
1.0
9.3
2.1
2.2
1.2
2.8
24.6
.4
1.0
.4
3.2
1.7
.8
8.9
2.1
2.6
1.1
2.3
41.2
1.0
I.I
1.0
3.8
1.6
1.2
12.3
2.4
3.0
1.2
12.7
41.7
1.0
I.I
.8
4.6
1.6
I.I
11.7
2.1
2.8
1.2
13.7
41.6
1.0
.9
.8
4.3
1.6
1.0
13.1
1.8
1.0
1.2
15.0
45.2
I.I
1.2
1.0
4.5
2.0
1.2
13.6
1.6
2.7
1.0
15.4
43.9
.9
1.6
1.1
4.9
2.4
1.0
14.1
1.4
2.5
1.4
12.6
43.2
.7
I.I
.5
5.0
1.8
1.2
13.3
1.4
2.6
1.4
14.3
49.6
1.2
1.6
.7
5.1
2.3
1.7
13.3
2.0
3.0
1.3
17.4
25 OPEC 2
26
Ecuador
27
Venezuela
28
Indonesia
29
Middle East countries
30
African countries
14.5
.7
5.4
2.7
4.2
1.5
15.8
.6
5.2
2.7
6.2
1.1
14.8
.5
5.4
2.8
4.9
I.I
17.4
.5
5.1
3.3
7.4
1.2
22.9
.5
4.7
3.4
13.2
1.1
21.6
.5
4.4
3.2
12.4
1.1
21.6
.4
3.9
3.3
13.0
1.0
23.8
.5
3.7
3.8
15.0
.9
19.5
.5
3.5
4.0
10.7
.7
20.3
.7
3.5
4.1
11.4
.6
22.3
.7
3.0
4.4
13.5
.6
31 Non-OPEC developing countries
64.3
72.6
77.4
82.9
94.1
94.5
92.9
95.9
98.4
103.5
103.6
4.8
9.6
3.6
1.7
15.5
.4
2.1
6.6
10.8
4.4
1.8
16.0
.5
2.6
7.2
11.7
4.7
2.0
17.5
.3
2.7
7.7
12.0
4.7
2.1
17.6
.4
3.1
8.7
12.7
5.1
2.2
18.8
.6
2.8
9.9
12.0
5.1
2.4
18.4
.6
2.7
10.5
9.3
5.4
2.4
19.6
.6
2.8
11.2
8.4
6.1
2.6
18.4
.5
2.7
11.4
9.2
6.3
2.6
17.8
.6
2.4
12.3
10.0
7.0
2.6
17.6
.8
2.6
10.9
13.2
6.3
2.9
16.3
.7
2.6
.3
4.1
3.0
.5
6.8
2.3
3.7
1.7
2.4
.7
5.2
3.2
.4
6.6
3.1
3.6
2.2
2.0
7.3
3.2
.5
6.7
4.4
3.1
3.1
3.1
.8
7.6
3.4
.4
14.1
5.2
3.4
3.0
3.1
.8
7.1
3.7
.4
14.3
5.2
3.2
3.3
3.2
1.0
6.9
3.9
.4
14.4
3.9
2.9
3.5
3.4
1.1
9.2
4.2
.4
16.2
3.1
3.3
3.1
.5
6.4
2.9
.4
6.5
4.1
2.6
2.8
3.4
4.7
1.1
8.5
3.8
.6
16.9
3.9
3.0
3.3
4.9
1.4
9.0
4.0
.6
18.7
4.1
3.6
3.8
3.5
1.7
9.0
4.4
.5
18.0
4.3
3.3
3.9
3.6
.4
.7
.0
.7
.2
.6
.0
1.0
.2
.6
.0
.8
.4
.7
.0
.8
.4
.7
.0
1.0
.5
.7
.0
.9
.3
.7
.0
.9
.3
.6
.0
.8
.4
.6
.0
.7
.4
.9
.0
.6
.4
.9
.0
.7
2.4
.9
.9
.7
3.1
1.9
.6
.6
3.0
1.7
.6
.7
3.1
1.6
.6
.9
3.4
1.5
.5
1.4
3.0
1.2
.5
1.4
3.0
1.1
.5
1.5
2.7
.8
.5
1.4
2.3
.6
.4
1.2
1.8
.4
.3
1.0
3.4
.6
.4
2.3
56 Offshore banking centers
57
Bahamas
58
Bermuda
59
Cayman Islands and other British West Indies
60
Netherlands Antilles
61
Panama 6
62
Lebanon
63
Hong Kong
64
Singapore
65
Other'
53.8
11.9
2.3
15.5
1.2
1.4
58.1
6.9
6.2
21.5
I.I
1.9
67.9
12.7
5.5
15.1
2.8
2.1
72.0
10.8
8.6
17.4
2.6
2.4
78.1
13.4
8.9
17.5
3.5
2.0
79.9
13.0
6.5
23.5
2.5
1.9
76.3
13.4
6.0
21.1
1.7
1.9
70.5
10.0
8.3
19.8
1.0
1.3
84.4
12.6
8.7
19.3
.9
I.I
83.0
7.9
8.5
23.3
2.5
1.3
84.0
10.4
6.3
23.3
5.5
1.3
14.3
7.1
.0
13^9
6.5
.0
19J
10.4
.0
18.7
11.2
19/7
13.0
.0
2L8
10.6
.0
203
11.8
.0
19^9
10.1
22.4
.1
19.2
.0
23 X)
16.4
.0
23.1
.1
66 Miscellaneous and unallocated 8
47.9
39.7
46.2
43.4
55.9
69.7
65.8
66.6
82.0
72.1
59.6
2 G-10 countries and Switzerland
3
Belgium and Luxembourg
4
France
5
Germany
6
Italy
7
Netherlands
8
Sweden
9
Switzerland
10
United Kingdom
11
Canada
12
Japan
32
33
34
35
36
37
38
Latin America
Argentina
Brazil
Chile
Colombia
Mexico
Peru
Other
39
40
41
42
43
44
45
46
47
Asia
China
People's Republic of China
Republic of China (Taiwan)
India
Israel
Korea (South)
Malaysia
Philippines
Thailand
Other Asia
48
49
50
51
Africa
Egypt
Morocco
Zaire
Other Africa-1
52 Eastern Europe
53
Russia 4
54
Yugoslavia 5
55
Other
1. The banking offices covered by these data include U.S. offices and foreign branches of
U.S. banks, including U.S. banks that are subsidiaries of foreign banks. Offices not covered
include U.S. agencies and branches of foreign banks. Beginning March 1994, the data include
large foreign subsidiaries of U.S. banks. The data also include other types of U.S. depository
institutions as well as some types of brokers and dealers. To eliminate duplication, the data
are adjusted to exclude the claims on foreign branches held by a U.S. office or another foreign
branch of the same banking institution.
These data are on a gross claims basis and do not necessarily reflect the ultimate country
risk or exposure of U.S. banks. More complete data on the country risk exposure of U.S. banks
are available in the quarterly Country Exposure Lending Survey published by the Federal
Financial Institutions Examination Council.
2.1
13.3
.1
2. Organization of Petroleum Exporting Countries, shown individually; other members of
OPEC (Algeria, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, and United
Arab Emirates); and Bahrain and Oman (not formally members of OPEC).
3. Excludes Liberia. Beginning March 1994 includes Namibia.
4. As of December 1992, excludes other republics of the former Soviet Union.
5. As of December 1992, excludes Croatia, Bosnia and Hercegovinia, and Slovenia.
6. Includes Canal Zone.
7. Foreign branch claims only.
8. Includes New Zealand, Liberia, and international and regional organizations.
Nonbank-Reported Data
3.22
A61
LIABILITIES TO UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in
the United States
Millions of dollars, end of period
1995
1994
Type of liability, and area or country
1991
1992
1993
Mar.
June
Sept.
Dec.
Mar.
June p
1 Total
44,708
45,511
50,330
52,102
55,350
57,190
54,586
51,092
50,565
2 Payable in dollars
3 Payable in foreign currencies
39,029
5,679
37,456
8,055
38,728
11,602
38,543
13,559
42,936
12,414
42,712
14,478
39,651
14,935
37,204
13,888
35,635
14,930
By type
4 Financial liabilities
Payable in dollars
5
6
Payable in foreign currencies
22,518
18,104
4,414
23,841
16,960
6,881
28,959
18,545
10,414
30,485
18,930
11,555
33,245
22,819
10,426
35,871
23,262
12,609
32,852
19,792
13,060
29,752
17,645
12,107
28,832
15,876
12,956
7 Commercial liabilities
Trade payables
8
9
Advance receipts and other liabilities
22,190
9,252
12,938
21,670
9,566
12,104
21,371
8,802
12,569
21,617
8,979
12,638
22,105
9,911
12,194
21,319
9,550
11,769
21,734
10,005
11,729
21,340
9,908
11,432
21,733
10,558
11,175
10
11
Payable in dollars
Payable in foreign currencies
20,925
1,265
20,496
1,174
20,183
1,188
19,613
2,004
20,117
1,988
19,450
1,869
19,859
1,875
19,559
1,781
19,759
1,974
12
13
14
15
16
17
18
By area or country
Financial liabilities
Europe
Belgium and Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
12,003
216
2,106
682
1,056
408
6,528
13,387
414
1,623
889
606
569
8,610
18,810
175
2,539
975
534
634
13,332
20,582
525
2,606
1,214
564
1,200
13,865
23,689
524
1,590
939
533
631
18,255
23,813
661
2,241
1,467
648
633
16,848
20,870
495
1,727
1,961
552
688
14,709
16,804
612
2,046
1,755
633
883
10,025
17,217
778
1,101
1,589
530
1,056
11,133
19
Canada
292
544
859
508
698
618
629
1,817
894
20
21
22
23
24
25
26
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
4,784
537
114
6
3,524
7
4
4,053
379
114
19
2,850
12
6
3,359
1,148
0
18
1,533
17
5
3,554
1,158
120
18
1,613
14
5
3,125
1,052
115
18
1,297
13
5
3,139
1,112
15
7
1,344
15
5
3,021
926
80
207
1,160
0
5
3,024
931
149
58
1,231
10
5
2,808
851
138
58
1,118
3
4
27
28
29
Asia
Japan
Middle Eastern oil-exporting countries'
5,381
4,116
13
5,818
4,750
19
5,689
4,620
23
5,650
4,638
24
5,694
4,760
24
8,149
6,947
31
8,147
7,013
35
7,911
6,890
27
7,720
6,791
25
30
31
Africa
Oil-exporting countries 2
6
4
6
0
133
123
133
124
9
0
133
123
135
123
156
122
151
122
32
All other 3
52
33
109
58
30
19
50
40
42
8,701
248
1,039
1,052
710
575
2,297
7,398
298
700
729
535
350
2,505
6,827
239
655
684
688
375
2,039
6,553
263
554
577
628
388
2,142
6,919
254
712
670
649
473
2,309
6,866
287
742
552
674
391
2,350
6,835
241
760
604
722
327
2,444
6,812
271
692
504
574
329
2,848
6,964
288
581
575
476
434
2,902
33
34
35
36
37
38
39
Commercial liabilities
Europe
Belgium and Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
40
Canada
1,014
1,002
879
1,039
1,070
1,068
1,037
1,198
1,107
41
42
43
44
45
46
47
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
1,355
3
310
219
107
307
94
1,533
3
307
209
33
457
142
1,658
21
350
214
27
481
123
1,900
8
493
209
20
554
147
2,000
2
418
215
24
703
192
1,783
6
200
147
33
672
189
1,857
19
345
161
23
574
276
1,389
8
265
97
29
362
273
1,856
3
401
108
12
428
204
48
49
50
Asia
Japan
Middle Eastern oil-exporting countries'
9,334
3,721
1,498
10,594
3,612
1,889
10,980
4,314
1,534
10,927
4,617
1,534
10,968
4,389
1,834
10,501
4,235
1,680
11,058
4,801
1,603
10,937
4,785
1,800
10,874
4,350
1,810
51
52
Africa
Oil-exporting countries -
715
327
568
309
453
167
478
194
510
241
468
264
428
256
463
248
482
252
53
Other 3
1,071
575
574
720
638
633
519
541
450
1. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab
Emirates (Trucial States).
2. Comprises Algeria, Gabon, Libya, and Nigeria.
3. Includes nonmonetary international and regional organizations.
A62
International Statistics • February 1996
3.23
CLAIMS ON UNAFFILIATED FOREIGNERS
the United States
Reported by Nonbanking Business Enterprises in
Millions of dollars, end of period
1994
Type of claim, and area or country
1991
1992
1995
1993
Mar.
June
Sept.
Dec.
Mar.
June
1 Total
45,262
45,073
48,881
50,716
49,513
51,406
56,743
52,177
57,657 r
2 Payable in dollars
3 Payable in foreign currencies
42.564
2,698
42,281
2.792
44,883
3,998
46,596
4,120
45,018
4,495
47,065
4,341
52,690
4,053
47,878
4,299
53,276 r
4,381
By type
4 Financial claims
5
6
Payable in dollars
Payable in foreign currencies
7
8
Other financial claims
9
Payable in dollars
10
Payable in foreign currencies
27,882
20,080
19,080
1,000
7,802
6,910
892
26,509
17,695
16,872
823
8,814
7,890
924
27,528
15,681
15,146
535
11,847
10,655
1,192
29,379
16.404
15,847
557
12,975
11,788
1,187
27,337
15,842
15,203
639
11,495
10,172
1,323
28,930
16,764
16,153
611
12,166
10,978
1.188
32,876
18,720
18,245
475
14,156
13,096
1,060
28,651
17,218
16,609
609
11,433
10,266
1,167
33,539 r
22,149
21,477
672
11,390r
10,303r
1,087
11 Commercial claims
12
Trade receivables
13
Advance payments and other claims
17,380
14,468
2,912
18.564
16,007
2,557
21,353
18,390
2,963
21,337
18,480
2,857
22,176
19,375
2,801
22,476
19,713
2,763
23,867
21,034
2,833
23,526
20,581
2,945
24,118 r
21,177 r
2,941
14
IS
Payable in dollars
Payable in foreign currencies
16,574
806
17,519
1,045
19,082
2,271
18,961
2,376
19,643
2,533
19,934
2,542
21,349
2,518
21,003
2,523
21,496 r
2,622
16
1/
18
19
20
21
22
BY area or country
Financial claims
Europe
Belgium and Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
13,441
13
269
283
334
581
11,534
9,331
8
764
326
515
490
6,252
7,249
134
826
526
502
530
3,535
7,411
125
790
466
503
535
3,853
6,763
83
995
459
472
509
3,127
8,156
114
831
413
503
747
4,440
7,679
86
800
540
429
523
4,436
7,277
69
808
443
606
490
3,919
7,439 r
81
706
355
601
499
4,493 r
2,642
23
Canada
24
2S
26
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
21
28
29
30
31
32
33
34
3S
36
37
38
39
40
41
42
43
Japan
Middle Eastern oil-exporting countries'
Africa
Oil-exporting countries"
All other
1
Commercial claims
Europe
Belgium and Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
1.833
2,032
2,294
3,080
3,164
3,801
4,064
3,929
10,717
827
8
351
9,056
212
40
13,893
778
40
686
11.747
445
29
16,031
1,310
125
654
12,536
868
161
16,645
1,385
34
672
13,281
850
26
14,799
1,288
39
466
11,993
614
33
14,952
1,086
52
411
12,271
655
32
18,841
2,369
27
520
14,880
606
35
15,500
905
37
487
13,274
475
27
20,579 r
2,322
85
460
I6,798 r
524
27
640
350
5
864
668
3
1,657
892
3
2,550
1,657
5
2.234
1,349
2
2,175
662
19
1,838
931
141
1,457
584
4
1,226
467
5
57
1
83
9
99
1
76
0
74
1
87
1
249
0
77
9
64
9
385
505
460
403
387
396
468
276
302
8,193
194
1.585
955
645
295
2,086
8,451
189
1.537
933
552
362
2.094
9,105
184
1,947
1,018
423
432
2,377
8,793
182
1,830
950
355
415
2,348
8,952
189
1,779
940
294
686
2,443
8,812
179
1,766
883
331
538
2,505
9,517
213
1,879
1,027
307
557
2,547
9,047
198
1,783
995
335
562
2,404
9,23 r
216
1,673
l,026 r
349
620
2,460 r
44
Canada
1,121
1,286
1,781
1,870
1,875
1,906
1,988
2,006
1,986r
45
46
47
48
49
50
SI
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
2.655
13
264
427
41
842
203
3.043
28
255
357
40
924
345
3,274
11
182
460
71
990
293
3.560
13
222
419
58
1,011
292
3,900
18
295
500
67
1,048
303
3,960
34
246
471
49
1,136
388
4,117
9
234
612
83
1,243
348
4,146
17
202
678
59
1,114
294
4,344 r
21
207
766 r
85
1,113r
318
52
53
54
Asia
Japan
Middle Eastern oil-exporting countries'
4,591
1,899
620
4,866
1,903
693
5.979
2,275
701
5.932
2,447
654
6,266
2,490
608
6,561
2,586
605
6,881
2,623
690
7,013
2,725
690
7,18l r
2,806r
697
55
56
Africa
Oil-exporting countries"
430
95
554
78
493
72
487
88
472
78
445
59
454
67
475
75
463 r
61
57
Other 1
390
364
721
695
711
792
910
839
913 r
1. Comprises Bahrain, Iran. Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab
Emirates (Trucial States).
2. Comprises Algeria, Gabon, Libya, and Nigeria.
3. Includes nonmonetary international and regional organizations.
Securities Holdings and Transactions
3.24
A63
FOREIGN TRANSACTIONS IN SECURITIES
Millions of dollars
1995
1995
Transaction, and area or country
1993
1994
Jan.—
Oct.
Apr.
May
June
July
Aug.
Sept.
Oct. p
41,487
42,856
U.S. corporate securities
STOCKS
319,664
298,086
350,558
348,648
374,344
368,174
30,082
29,206
38,769
36,087
45,429
43,199
42,444
40,009
41,908
39,366
44,448
44,217
3 Net purchases, or sales (—)
21,578
1,910
6,170
876
2,682
2,230
2,435
2,542
231
-1,369
4 Foreign countries
21,306
1,900
6,362
877
2,692
2,238
2,443
2,565
294
-1,329
10,658
-103
1,642
-602
2,986
4,559
-3,213
5,719
-321
8,198
3,825
63
202
6,717
-201
2,110
2,251
-30
840
-1,160
-2,108
-1,142
-1,207
1,190
29
771
2,883
-659
-1,695
2,919
-2,701
6,184
-1,747
4,231
-469
1,278
-3,550
29
157
165
-80
-261
349
-673
1,125
-197
570
59
314
29
-10
-24
381
-66
-528
174
-476
1,382
75
-26
-87
2,013
86
41
295
-44
-79
-224
70
-201
243
-740
1,651
-99
1,358
-466
15
97
2,045
261
8
364
-20
1,445
-425
881
-24
107
141
-5
-136
1,836
17
-104
431
-847
2,330
-10
1,811
-5
-961
-1,076
17
-123
-1,319
-126
-136
197
9
-1,114
-197
751
-77
1,048
-598
34
54
1,647
-54
5
528
449
878
-74
-2,921
-8
61
56
-17
-17
272
10
-192
-1
-10
-8
-8
-23
-63
-40
283,824
217,824
289,614
229,665
237,868
164,247
18,163
14,111
22,830
16,609
27,934
18,774
23,811
14,943
24,742
16,741
26,615 r
17,338r
26,327
19,199
21 Net purchases, or sales (—)
66,000
59,949
73,621
4,052
6,221
9,160
8,868
8,001
9,277 r
7,128
22 Foreign countries
65,462
59,064
74,056
4,035
6,309
9,167
9,035
7,982
9,255 r
7,196
23
24
25
26
27
28
29
30
31
32
33
34
35
22,587
2,346
887
-290
-627
19,686
1,668
15,691
3,248
20,846
11,569
1,149
273
37,093
242
657
3,322
1,055
31,592
2,958
5,442
771
12,153
5,486
-7
654
57,717
905
4,676
1,143
774
48,266
2,421
5,564
1,494
6,657
4,053
-92
295
2,271
-874
-83
-37
-87
3,396
184
889
326
356
275
-11
20
4,944
27
-17
191
124
4,764
277
678
-26
426
871
-5
15
7,772
44
667
-59
-130
7,062
159
289
64
785
293
47
51
6,246
7
51
557
317
4,969
169
1,145
348
1,189
1,026
-13
-49
5,561
538
1,163
45
-99
3,775
415
754
281
919
1,008
64
-12
6,782 r
63
916
203
343
4,334 r
349
1,720
241
139r
— 371 r
23
1
6,321
732
113
204
148
4,502
139
-61
-246
1,126
645
-223
140
538
885
-435
17
-88
-7
-167
19
1 Foreign purchases
2 Foreign sales
5
6
7
X
9
10
11
12
13
14
15
16
17
Europe
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
Latin America and Caribbean
Middle East1
Other Asia
Japan
Africa
Other countries
18 Nonmonetary international and
regional organizations
BONDS2
19 Foreign purchases
20 Foreign sales
Europe
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
Latin America and Caribbean
Middle East1
Other Asia
Japan
Africa
Other countries
36 Nonmonetary international and
regional organizations
22
-68
Foreign securities
-62,691
245,490
308,181
-80,377
745,952
826,329
37 Stocks, net purchases, or sales ( - )
38
Foreign purchases
39
Foreign sales
40 Bonds, net purchases, or sales ( - )
41
Foreign purchases
42
Foreign sales
43 Net purchases, or sales (—), of stocks and bonds
44 Foreign countries
45
46
47
48
49
50
Europe
Canada
Latin America and Caribbean
Africa
Other countries
51 Nonmonetary international and
regional organizations
....
-47,236
386,942
434,178
-9,272
848,288
857,560
-41,840
282,762
324,602
-35,681
737,493
773,174
-2,135
24,519
26,654
-824
53,639
54,463
-3,648
29,229
32,877
-4,368
75,199
79,567
-4,379
29,067
33,446
-7,473
96,154
103,627
-8,188
28,582
36,770
-5,009
66,737
71,746
-5,904
30,867
36,771
—3,755r
72,277 r
76,032
—7,955r
28,712
36,667 r
—4,868r
83,396 r
88,264 r
-5,494
29,382
34,876
-5,569
81,257
86,826
-143,068
-56,508
-77,521
-2,959
-8,016
-11,852
-13,197
-9,659r
— 12,823 r
-11,063
-12,978
r
-12,878r
-10,609
-143,232
-57,028
-76,390
-8,020
-11,541
-100,872
-15,664
-7,600
-15,159
-185
-3,752
-2,712
-7,475
-18,347
-24,276
-467
-3,751
-36,107
-7,278
-6,508
-26,620
-302
425
-1,893
-1,193
585
-558
-14
-42
-7,561
-1
471
-1,388
-68
527
-5,857
-1,425
-512
-2,941
-67
-739
-7,961
-1,751
-659
-3,158
-45
596
164
520
-1,131
156
4
-311
-219
I. Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, Kuwait, Oman, Qatar,
Saudi Arabia, and United Arab Emirates (Trucial States).
-3,115
—9,486
-2,539
— 851 r
817
-7,250
34
303
-173
—2,924r
— 3,133r
781 r
—7,533
—117
48
55
-5,810
1,563
-3,883
-1,770
5
-714
-454
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.
A64
3.25
International Statistics • February 1996
MARKETABLE U.S. TREASURY BONDS AND NOTES
Foreign Transactions'
Millions of dollars; net purchases, or sales ( - ) during period
1995
Area or country
1993
1995
1994
Jan.—
Oct.
Apr.
May
June
July
Aug.
Sept.
Oct.p
1 Total estimated
23,552
78,796
129,567
6,400
14,519
22,578
31,865
26,082
— ll,072 r
6,303
2 Foreign countries
23,368
78,632
129,079
6,416
14,568
22,395
31,382
26,442
- 1 l,002 r
6,134
3
4
6
7
8
9
10
11
Europe
Belgium and Luxembourg
Germany
Netherlands
Sweden
Switzerland
United Kingdom
Other Europe and former U.S.S.R
Canada
-2,373
1,218
-9,976
-515
1,421
-1,501
6,197
783
10,309
38,608
1,098
5,709
1,254
794
481
23,438
5,834
3,491
51,746
339
5,632
2,161
673
760
37,809
4,372
87
3,152
62
1,216
-243
-70
-173
2,251
109
-1,391
509
-512
-4,129
40
211
353
5,203
-657
201
2,665
-148
-1,866
1,078
63
9
1,359
2,170
433
13,336
-53
1,039
883
124
206
7,315
3,822
720
9,170
580
2,995
-1.468
100
-515
7,950
-472
-825
6,377
143
2,568
-1,915
61
818
5,570
-868
-2,284 r
-3,124
-25
2,831
1,644
92
174
-5,965
-1,875
-1,864
12
13
14
13
lb
17
18
19
Latin America and Caribbean
Venezuela
Other Latin America and Caribbean
Netherlands Antilles
Asia
Japan
Africa
Other
-4,561
390
-5,795
844
20,582
17,070
1,156
-1,745
-10,179
-319
-20,493
10,633
47,042
29,518
240
-570
31,351
-295
16,719
14.927
44,269
21,242
754
872
3.212
184
2,189
839
1,189
1,487
-36
290
3,803
-16
2,425
1,394
9,845
6,291
39
171
5,368
121
5,158
89
12,605
5,585
242
1,082
513
-114
1,034
-407
16,490
6,658
-1
324
11,265
-359
5,364
6,260
7,322
5,430
-130
-360
-5,299
-524
1,171
-5,946
-10,055
-4,021
108
151
17,453
-92
3,033
14,512
-6,879
-10,115
501
47
184
-330
653
164
526
-154
488
-12
423
-16
-294
228
-49
356
-528
183
-409
629
483
311
99
-360
-140
-10
-70
-196
-6
169
2
185
23 Foreign countries
24
Official institutions
Other foreign
25
23,368
1,306
22,062
78,632
41,822
36,810
129,079
37,791
91,288
6,416
3,158
3,258
14,568
-1,774
16,342
22,395
10,850
11,545
31,382
16,780
14,602
26,442
-364
26,806
-11,002'
-4,525 r
-6,477 r
6,134
5,705
429
Oil-exporting countries
2b Middle East"
27 Africa 3
-8,836
-5
-38
0
4,986
2
733
0
-1,063
0
815
1
3,582
0
1,890
0
-50
0
-624
0
20 Nonmonetary international and regional organizations
21
International
22
Latin American regional
MEMO
I. 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
A65
DISCOUNT RATES OF FOREIGN CENTRAL BANKS'
Percent per year, averages of daily figures
Rate on Dec. 31, 1995
Rate on Dec. 31, 1995
Country
Country
Month
effective
Austria. .
Belgium.
Canada. .
Denmark
France" .
3.0
3.0
5.79
4.25
4.45
Dec.
Dec.
Dec.
Dec.
Dec.
1995
1995
1995
1995
1995
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
Month
effective
Germany . . .
Italy
Japan
Netherlands .
Switzerland .
3.0
9.0
.5
2.75
1.5
Dec.
June
Sept.
Dec.
Dec.
1995
1995
1995
1995
1995
2. Since February 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'
Percent per year, averages of daily figures
1995
Type or country
1993
1994
1995
June
1
2
3
4
5
6
7
8
9
10
Eurodollars
United Kingdom
Canada
Germany
Switzerland
Netherlands
France
Italy
Belgium
Japan
3.18
5.88
5.14
7.17
4.79
6.73
8.30
10.09
8.10
2.96
4.63
5.45
5.57
5.25
4.03
5.09
5.72
8.45
5.65
2.24
5.93
6.63
7.14
4.43
2.94
4.30
6.43
10.43
4.73
1.20
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.
July
Aug.
Sept.
Oct.
Nov.
Dec.
5.89
6.63
7.07
4.43
3.09
4.21
7.04
10.91
4.62
1.16
5.79
6.73
6.69
4.46
2.77
4.14
6.31
10.93
4.52
.91
5.79
6.74
6.62
4.35
2.79
4.02
5.81
10.45
4.41
.82
5.74
6.71
6.66
4.09
2.67
3.85
5.86
10.36
4.20
.56
5.81
6.69
6.66
4.00
2.15
3.88
6.73
10.74
4.14
.51
5.75
6.61
6.02
3.91
1.98
3.73
5.74
10.65
3.87
.54
5.64
6.42
5.91
3.82
1.94
3.58
5.47
10.58
3.74
.52
A66
3.28
International Statistics • February 1996
FOREIGN EXCHANGE RATES'
Currency units per dollar except as noted
1995
Country/currency unit
1993
1994
1995
July
2
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 2
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 2
Aug.
Sept.
Oct.
Nov.
Dec.
67.993
11.639
34.581
1.2902
5.7795
6.4863
5.7251
5.6669
1.6545
229.64
73.161
11.409
33.426
1.3664
8.6404
6.3561
5.2340
5.5459
1.6216
242.50
74.073
10.076
29.472
1.3725
8.3700
5.5999
4.3763
4.9864
1.4321
231.68
72.792
9.765
28.562
1.3612
8.3207
5.4073
4.2592
4.8307
1.3886
225.45
74.137
10.168
29.735
1.3552
8.3253
5.6060
4.3170
4.9727
1.4456
232.38
75.371
10.270
30.044
1.3509
8.3374
5.6587
4.3754
5.0352
1.4601
235.65
75.699
9.955
29.105
1.3458
8.3353
5.4912
4.2781
4.9374
1.4143
232.65
74.534
9.974
29.154
1.3534
8.3334
5.4923
4.2489
4.8882
1.4173
234.16
74.053
10.142
29.615
1.3693
8.3350
5.5791
4.3361
4.9565
1.4406
238.06
7.7357
31.291
146.47
1,573.41
111.08
2.5738
1.8585
54.127
7.1009
161.08
7.7290
31.394
149.69
1,611.49
102.18
2.6237
1.8190
59.358
7.0553
165.93
7.7357
32.418
160.35
1,629.45
93.96
2.5073
1.6044
65.625
6.3355
149.88
7.7385
31.385
163.96
1,609.71
87.40
2.4500
1.5557
67.417
6.1710
145.88
7.7416
31.592
160.25
1,607.18
94.74
2.4813
1.6195
65.687
6.3438
149.88
7.7368
33.310
159.05
1,613.41
100.55
2.5124
1.6354
65.607
6.3943
152.11
7.7317
34.656
161.32
1,605.69
100.84
2.5324
1.5846
65.899
6.2397
148.94
7.7338
34.710
160.54
1,592.67
101.94
2.5389
1.5877
65.224
6.2536
148.68
7.7345
34.966
159.18
1,593.88
101.85
2.5399
1.6127
64.996
6.3579
151.03
1.6158
3.2729
805.75
127.48
48.211
7.7956
1.4781
26.416
25.333
150.16
1.5275
3.5526
806.93
133.88
49.170
7.7161
1.3667
26.465
25.161
153.19
1.4171
3.6286
772.82
124.64
51.047
7.1406
1.1812
26.495
24.921
157.85
1.3984
3.6404
760.05
119.71
50.899
7.1749
1.1556
26.278
24.755
159.52
1.4116
3.6402
768.88
123.45
51.227
7.2383
1.1962
27.234
24.960
156.68
1.4331
3.6616
772.04
125.41
52.547
7.1227
1.1868
27.432
25.129
155.90
1.4231
3.6502
767.20
122.51
52.539
6.8301
1.1453
26.925
25.115
157.79
1.4128
3.6499
769.78
121.81
53.199
6.6088
1.1437
27.257
25.166
156.25
1.4148
3.6632
771.31
122.53
53.808
6.6393
1.1631
27.315
25.164
154.05
85.69
84.10
84.14
85.07
MEMO
31 United States/dollar 3
93.18
91.32
84.25
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.
81.90
84.59
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).
67
Guide to Statistical Releases and Special Tables
STATISTICAL RELEASES—List Published
Semiannually,
with Latest Bulletin
Issue
December 1995
Anticipated schedule of release dates for periodic releases
SPECIAL TABLES—Data Published
Irregularly,
Reference
Page
A76
Issue
Page
with Latest Bulletin Reference
Title and Date
Assets and liabilities of commercial banks
March 31, 1993
June 30, 1993
September 30, 1993
December 31, 1993
August
November
February
May
1993
1993
1994
1994
A70
A70
A70
A68
Terms of lending at commercial banks
February 1995
May 1995
August 1995
November 1995
May
August
November
February
1995
1995
1995
1996
A68
A68
A68
A68
Assets and liabilities of U.S. branches and agencies offoreign banks
December 31, 1994
March 31, 1995
June 30, 1995
September 30, 1995
May
October
November
February
1995
1995
1995
1996
A72
A68
A72
A72
October
August
October
January
1992
1995
1995
1996
A70
A76
A72
A68
Assets and liabilities of life insurance companies
June 30,1991
September 30,1991
December 31, 1991
September 30, 1992
December
May
August
March
1991
1992
1992
1993
A79
A81
A83
A71
Residential lending reported under the Home Mortgage Disclosure Act
1994
September 1995
A68
Pro forma balance sheet and income statements for priced service operations
June 30, 1992
March 31, 1995
June 30, 1995
September 30, 1995
A68
4.23
Special Tables • February 1996
TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, November 6-10, 19951
Commercial and industrial loans
Type of maturity
of loan
Amount of
loans
(thousands of
dollars)
Average size
(thousands of
dollars)
Weighted
average
maturity2
Loan rate (percent)
Loans made
under
commitment
(percent)
6.91
6.76
7.71
26.8
22.0
52.8
66.6
62.6
88.1
6.4
7.2
1.9
7.80
7.05
8.43
46.8
34.9
56.6
80.9
83.1
79.1
10.6
11.9
9.5
7.70
6.31
8.92
44.8
19.0
67.3
68.7
64.3
72.4
5.4
7.6
3.5
7.25
Days
Loans
secured
by
collateral
(percent)
32.5
68.0
5.8
6.62
18.8
10.01
83.7
66.9
52.5
30.6
24.1
12.0
63.9
40.6
67.1
79.5
72.6
67.5
61.0
5.9
.3
8.6
11.3
7.7
9.4
4.6
7.16
75.4
71.2
56.9
58.2
47.1
76.7
86.9
87.8
88.4
83.2
79.6
56.4
5.6
2.3
4.2
10.4
5.6
7.2
5.6
Weighted
average
effective1
Participation loans
(percent)
ALL BANKS
1 Overnight6
14,385,356
2 One month or less (excluding overnight)
3
Fixed rate
4
Floating rate
11,161,572
9,399,793
1,761,779
1,958
2,777
761
5 More than one month and less than one
year
6
Fixed rate
7
Floating rate
10,669,979
4,826,445
5,843,534
219
292
8 Demand7
9
Fixed rate
10
Floating rate
17,757,969
8,282,070
9,475,899
308
1,354
184
11 Total short-term
53,974,877
473
12 Fixed rate (thousands of dollars)
13
1-99
14
100-499
15
500-999
16
1,000-4,999
17
5,000-9,999
18
10,000 or more
36,660,979
366,195
518,850
645,729
5,541,025
5,365,033
24,224,148
1,308
19 Floating rate (thousands of dollars)
20
1-99
21
100^*99
22
500-999
23
1,000^1,999
24
5,000-9,999
25
10,000 or more
17,313,897
1,787,805
3,321,441
1,564,746
3,843.214
1,676,083
5,120.608
26 Total long-term
8,057,156
334
8.41
67.9
68.7
4.3
27 Fixed rate (thousands of dollars). .
28
1-99
29
100-499
30
500-999
31
1,000 or more
1,721,950
173,042
249,339
111,867
1,187,701
180
657
4,770
8.09
9.77
9.10
8.61
7.58
61.7
91.2
89.1
76.9
50.3
53.8
26.5
41.3
73.1
58.6
4.7
10.7
7.3
32 Floating rate (thousands of dollars)
33
1-99
34
100-499
35
500-999
36
1,000 or more
6,335,206
286,861
896,765
467,668
4,683,912
435
32
218
650
5,440
8.49
10.12
9.51
9.21
8.13
69.6
87.5
81.3
71.1
66.1
72.7
64.7
80.1
88.5
70.3
182
18
226
695
2,357
6,561
22,122
201
28
199
665
1,944
6,665
22,948
148
116
175
26
124
104
44
36
37
17
135
179
184
163
140
106
106
22
180
8.57
7.56
6.99
6.77
6.38
8.60
10.22
9.70
9.36
8.65
61.5
81.8
8.21
6.5
.6
3.8
1.8
5.1
18.1
2.2
Loan rate (percent)
Days
Effective1
Nominal8
6.48
6.78
6.28
6.57
9.1
24.6
57.8
66.6
6.1
132
6.90
6.36
6.70
6.18
31.5
26.5
80.5
60.4
10.9
6.3
24
108
6.51
6.99
6.32
6.78
16.5
43.3
63.8
68.1
5.9
4.8
7.31
7.42
7.10
7.17
53.0
57.8
62.8
66.1
LOANS M A D E BELOW PRIME
37 Overnight6
38 One month or less (excluding overnight)
39 More than one month and less than one
year
40 Demand7
14,052,969
10,719,561
8,518
4,333
7,373,175
10,968,407
897
2,375
41 Total short-term
43,114,112
2,542
42 Fixed rate
43 Floating rate
35,498,930
7,615,183
3,569
1,086
44 Total long-term
4,699,378
1,024
45 Fixed rate
46 Floating rate . . .
1,198,615
3,500,763
485
1,654
Footnotes appear at the end of the table.
17
2.2
3.0
6.7
1.7
Financial Markets
4.23
A69
TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, November 6-10, 1995'—Continued
Commercial and industrial loans—Continued
Type of maturity
of loan
loans
(thousands of
dollars)
Average size
(thousands of
dollars)
Weighted
average
maturity 2
Days
Loan rate (percent)
Weighted
effective 3
Standard
error 4
Loans
secured
by
Loans made
under
commit-
(percent)
(percent)
Participation loans
(percent)
Most
common
base pricing
rate 5
LARGE BANKS
1 Overnight 6
9,878,130
7,015
•
6.62
.24
11.4
68.0
1.4
Domestic
2 One month or less (excluding overnight)
Fixed rate
3
Floating rate
4
8,432,075
6,882,617
1,549,458
3,828
4,899
1,943
18
17
21
6.93
6.77
7.61
.18
.12
.29
29.7
24.5
52.7
61.5
55.2
89.3
3.9
4.5
1.3
Other
Other
Foreign
5 More than one month and less than one
year
Fixed rate
Floating rate
5,680,852
2,928,564
2,752,288
862
2,200
523
130
97
165
7.48
7.00
7.99
.15
.16
.20
41.0
34.9
47.5
88.4
85.1
92.0
10.0
10.5
9.3
Foreign
Foreign
Prime
8 Demand 7
Fixed rate
9
10
Floating rate
12,767,728
6,944,060
5,823,668
534
4,652
260
*
7.24
6.13
8.55
.18
.21
.20
38.5
16.3
64.9
62.2
61.6
62.9
4.9
5.9
3.8
Other
Other
Prime
11 Total s h o r t - t e r m
36,758,785
1,078
38
7.04
.15
29.6
67.7
4.5
Other
12 Fixed rate (thousands of dollars)
13
1-99
14
100-499
15
500-999
16
1,000-4,999
17
5,000-9,999
18
10,000 or more
26,440,907
30,533
224,360
443,272
4,114,280
4,191,855
17,436,607
4,712
33
264
700
2,357
6,594
21,161
21
108
65
37
34
22
16
6.58
8.98
7.96
7.44
6.97
6.80
6.39
.16
.21
.21
.29
.19
.10
.11
18.8
74.8
59.9
49.8
31.5
24.5
13.0
64.7
70.7
74.8
78.4
68.1
62.0
64.0
4.4
2.7
7.4
8.9
5.1
4.7
4.0
Other
Other
Other
Other
Other
Other
Domestic
19 Floating rate (thousands of dollars)
20
1-99
21
100-499
22
500-999
23
1,000-4,999
24
5,000-9,999
25
10,000 or more
10,317,877
596,174
1,565,993
836,893
2,166,140
1,057,078
4,095,599
362
33
205
668
1,969
6,657
21,081
108
165
171
152
129
85
87
8.22
10.04
9.64
9.20
8.36
7.87
7.23
.19
.04
.04
.07
.12
.40
.43
57.2
75.1
73.2
66.1
49.1
39.2
55.6
75.3
89.0
90.5
86.8
85.0
73.2
60.6
4.8
1.4
3.0
7.3
5.6
3.2
5.6
Prime
Prime
Prime
Prime
Prime
Prime
Other
6
7
Months
6,028,605
1,130
45
8.21
.15
66.1
71.2
3.2
Prime
27 Fixed rate (thousands of dollars) . .
28
1-99
29
100-499
30
500-999
31
1,000 or more
994,592
12,433
52,156
43,106
886,897
1,158
29
237
687
5,975
43
44
48
49
42
7.78
9.32
8.32
8.22
7.71
.22
.24
.41
.39
.39
51.5
85.8
67.4
78.7
48.8
56.3
49.0
72.6
87.4
53.9
8.7
4.0
3.2
17.5
8.7
Prime
Other
Other
Foreign
Prime
32 Floating rate (thousands of dollars)
33
1-99
34
100-499
35
500-999
36
1,000 or more
5,034,012
67,886
416,458
264,443
4,285,225
1,125
42
235
682
6,058
46
35
35
36
48
8.30
9.81
9.42
9.06
8.12
.14
.07
.10
.24
.34
68.9
86.8
75.5
66.7
68.1
74.1
80.0
89.3
85.9
71.8
2.1
3.2
7.6
5.6
1.3
Prime
Prime
Prime
Prime
Prime
26 Total long-term
Loan rate (percent)
Prime rate9
Days
Effective3
Nominal 8
6.56
6.83
6.36
6.61
9.7
27.9
67.4
61.0
1.4
3.5
8.75
8.75
L O A N S M A D E BELOW P R I M E 1 "
37 Overnight 6
38 One month or less (excluding overnight)
39 More than one month and less than one
year
40 Demand 7
41 Total s h o r t - t e r m
42 Fixed rate
43 Floating rate
9,685,436
8,154,336
8,085
5,084
4,412,841
9,229,294
2,807
3,736
116
6.90
6.24
6.70
6.06
30.9
26.0
87.9
56.0
7.5
4.8
8.75
8.75
31,481,906
4,600
30
6.58
6.38
22.2
65.3
3.8
8.75
6.52
6.88
6.32
6.67
17.4
44.6
64.2
70.5
4.3
1.6
8.75
8.75
25,933,638
5,548,268
5,782
2,352
17
20
88
Months
44 Total long-term
3,868,491
3,457
44
7.37
7.13
58.2
67.1
2.1
8.75
45 Fixed rate
46 Floating rate . . .
777,077
3,091,414
1,752
4,575
43
44
7.27
7.40
7.05
7.15
47.4
60.9
63.7
68.0
7.7
.7
8.75
8.75
Footnotes appear at the end of the table.
A70
4.23
Special Tables • February 1996
TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, November 6-10, 1995'—Continued
Commercial and industrial loans—Continued
Type of maturity
of loan
Amount of
loans
(thousands of
dollars)
Average size
(thousands of
dollars)
Weighted
average
maturity"
Loan rate (percent)
Loans made
under
commitment
(percent)
Participation loans
(percent)
18.1
15.1
53.9
82.5
82.7
79.0
13.9
14.6
5.8
8.81
53.4
34.9
64.7
72.4
79.9
67.7
11.4
14.1
9.7
8.90
7.24
9.50
60.8
32.7
71.1
85.1
78.4
87.6
6.7
16.9
3.0
7.71
Days
Loans
secured
by
collateral
(percent)
38.7
68.8
8.4
6.72
9.04
7.83
7.06
6.65
6.37
18.7
84.5
72.3
58.3
27.8
22.8
9.4
62.0
37.9
61.2
82.0
85.6
87.4
53.3
9.7
.1
9.6
16.4
15.1
26.3
6.0
9.15
10.32
9.76
9.56
9.02
8.79
6.88
67.9
85.1
77.4
77.0
67.0
90.5
13.2
78.6
85.9
85.3
90.3
80.8
90.4
39.7
6.6
2.7
5.2
13.9
5.6
13.9
5.4
Weighted
average
effective3
OTHER BANKS
1 Overnight6
4,507,226
7,423
2 One month or less (excluding overnight)
3
Fixed rate
4
Floating rate
2,729,497
2,517,176
212,321
780
1,271
140
5 More than one month and less than one
year
Fixed rate
Floating rate
4,989,128
1,897,882
3,091,246
119
125
115
4,990,241
1,338,010
3,652,231
148
289
125
11 Total short-term
17,216,092
215
12 Fixed rate (thousands of dollars)
13
1-99
14
100-499
15
500-999
16
1,000-4,999
17
5,000-9,999
18
10,000 or more
10,220,072
335,662
294,489
202,458
1,426,745
1,173,177
6,787,540
456
17
203
684
2,354
6,446
25,046
36
125
132
56
40
96
6,996,020
1,191,631
1,755,448
727,853
1,677,074
619,004
1,025,009
122
171
6
7
8 Demand7
9
Fixed rate
10
Floating rate
19 Floating rate (thousands of dollars)
20
1-99
21
100^199
22
500-999
23
1,000^1,999
24
5,000-9,999
25
10,000 or more
26 Total long-term
26
193
663
1,911
6,679
35,511
6.86
6.72
8.43
169
146
184
18
181
191
170
153
154
167
8.17
7.12
10.11
2,028,551
108
73.3
61.3
27 Fixed rate (thousands of dollars). .
28
1-99
29
100-499
30
500-999
31
1,000 or more
727,357
160,608
197,183
68,761
300,804
83
22
170
639
2,990
8.51
9.81
9.31
8.86
7.22
75.7
91.6
94.8
75.7
54.7
50.4
24.8
33.0
64.1
72.4
3.5
.4
5.1
6.4
3.4
32 Floating rate (thousands of dollars)
33
1-99
34
100-499
35
500-999
36
1,000 or more
1,301,194
218,975
480,307
203,225
398,687
129
30
206
612
9.24
10.22
9.59
9.41
2,596
8.21
72.0
87.6
86.4
76.7
43.8
67.4
60.0
72.0
92.0
53.4
10.3
1.3
2.9
34.3
11.9
Loan rate (percent)
Days
Effective3
Nominal8
LOANS M A D E BELOW PRIME
37 Overnight6
38 One month or less (excluding overnight)
39 More than one month and less than one
year
40 Demand'
41 Total short-term
4.367,534
2,565,225
9,666
2,948
2,960,334
1,739,113
446
810
6.30
6.64
6.11
6.43
7.9
14.1
36.4
84.3
3.9
14.6
154
6.89
7.03
6.69
6.86
32.4
29.2
69.5
84.1
15.9
14.2
6.49
7.30
6.30
7.07
14.2
39.5
62.6
61.8
10.3
13.3
7.25
49.3
56.5
7.18
7.33
63.2
35.0
61.2
51.6
13
11,632,206
1,150
42 Fixed rate
43 Floating rate
9,565,292
2,066,914
1,752
444
32
150
44 Total long-term
830,887
240
43
45 Fixed rate
46 Floating rate . . .
421,537
409,349
208
284
Footnotes appear at the end of the table.
7.37
7.57
4.7
8.9
Financial Markets
4.23
A 71
TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, November 6-10, 1995'—Continued
NOTES
1. The survey of terms of bank lending to business collects data on gross loan extensions
made during the first full business week in the mid-month of each quarter by a sample of 340
commercial banks of all sizes. A sample of 250 banks reports loans to farmers. The sample
data are blown up to estimate the lending terms at all insured commercial banks during that
week. The estimated terms of bank lending are not intended for use in collecting the terms of
loans extended over the entire quarter or residing in the portfolios of those banks. Construction and land development loans include both unsecured loans and loans secured by real
estate. Thus, some of the construction and land development loans would be reported on the
statement of condition as real estate loans and the remainder as business loans. Mortgage
loans, purchased loans, foreign loans, and loans of less that $1,000 are excluded from the
survey. As of September 30, 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; excludes demand loans.
3. Effective (compounded) annual interest rate calculated from the stated rate and other
terms of the loans and weighted by loan size.
4. The chances are about two out of three that the average rate shown would differ by less
than the amount of the standard error from the average rate that would be found by a complete
survey of lending at all banks.
5. The rate used to price the largest dollar volume of loans. Base pricing rates include the
prime rate (sometimes referred to as a bank's "basic" or "reference" rate); {he 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 rate calculated from the stated rate and other
terms of the loans and weighted by loan size.
9. Calculated by weighting the prime rate reported by each bank by the volume of loans
reported by that bank, summing the results, and then averaging over all reporting banks.
10. The proportion of loans made at rates below the prime may vary substantially from the
proportion of such loans outstanding in banks' portfolios.
A72
4.30
Special Tables • February 1996
A S S E T S A N D LIABILITIES of U.S. Branches and Agencies of Foreign Banks, September 30, 1995 1
Millions of dollars except as noted
All states2
Item
1 Total assets 4
Total
including
IBFs1
IBFs
only1
Total
including
IBFs
Illinois
California
New York
IBFs
only
Total
including
IBFs
IBFs
only
Total
including
IBFs
IBFs
only
786,902
321,155
605,018
259,066
74,938
34,380
62,501
18,658
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 (US. and foreign)
6
Balances with depository institutions in United States
7
U.S. branches and agencies of other foreign banks
(including IBFs)
Other depository institutions in United States (including I B F s ) . . . .
8
9
Balances with banks in foreign countries and with foreign central
banks
in
Foreign branches of U.S. banks
11
Other banks in foreign countries and foreign central banks
Balances with Federal Reserve Banks
12
701,605
148,343
2,871
22
87.873
179,179
119,391
0
n.a.
66,335
537,889
127,767
2,693
15
75,301
145,177
100,704
0
n.a.
55,151
71,206
7,680
5
2
4,846
15,848
6,975
0
n.a.
4,195
58,401
10,800
109
1
7,057
12,686
10.238
0
n.a.
6,658
81,831
6,042
63,193
3,142
70,045
5,255
52,160
2,991
4,408
438
4,109
86
6,936
121
6,643
15
57,239
2,194
55,044
340
53,056
1,658
51,398
n.a.
49,492
1,878
47,614
267
45,553
1,370
44,183
n.a.
2.793
33
2,760
34
2,780
32
2,749
n.a.
3,627
210
3.417
6
3,580
210
3,370
n.a.
13 Total securities and loans
407,046
48,843
279,381
35,760
56,709
7,478
40,719
1,831
94,297
25,461
25,056
10,653
n.a.
n.a.
86,403
24,305
24,372
9,431
n.a.
n.a.
4,498
643
402
628
n.a.
n.a.
2,775
400
99
568
n.a.
n.a.
43,779
14,180
29,599
10,653
4,449
6,204
37,726
12,896
24,830
9,431
4,019
5,412
3,452
737
2,716
628
264
364
2,276
453
1.824
568
141
427
50,147
10,287
13,918
25,942
5,889
3,613
560
1,716
45,837
8,287
12,973
24,577
4,778
2,926
560
1,292
1,870
987
451
432
598
227
0
371
1,594
558
161
875
360
360
0
0
312,896
146
312.749
38,201
12
38,190
193,070
92
192,978
26,337
8
26,329
52,253
42
52,212
6,853
2
6,851
37,948
4
37,944
1,263
0
1,263
36,152
33,949
14,609
13,086
1,523
103
19,236
420
18,815
29,674
210
22,015
7,965
7,624
341
0
14,050
341
13,709
807
21,165
21,820
8,456
7,296
1,160
103
13.261
339
12,922
23,466
55
13,946
4,060
3,803
257
0
9,886
319
9.567
433
10,239
7,063
5,372
5,253
118
0
1,692
20
1,672
2,315
154
4,978
3,538
3,508
30
0
1,440
20
1,420
14
2,626
904
503
377
126
0
401
0
401
3,283
0
619
331
282
49
0
288
0
288
281
.37 Commercial and industrial loans
38
U.S. addressees (domicile)
39
Non-U.S. addressees (domicile)
40 Acceptances of other banks
41
U.S. banks
42
Foreign banks
43 Loans to foreign governments and official institutions (including
foreign central banks)
44 Loans for purchasing or carrying securities (secured and unsecured) . . .
45 All other loans
191,177
166,019
25,158
946
172
774
12,957
145
12,812
82
0
82
108,349
90,158
18,191
624
143
481
9,888
132
9,756
79
0
79
31,775
28,711
3,065
167
10
156
1,640
9
1,631
0
0
28,881
27,683
1,198
96
0
96
352
1
351
0
3,249
10,223
5,971
1,915
45
140
2,758
9,974
3,363
1,750
45
109
172
114
408
67
0
0
104
90
1,959
11
0
46 Assets held in trading accounts
47 All other assets
Customers' liabilities on acceptances outstanding
48
49
U.S. addressees (domicile)
Non-U.S. addressees (domicile)
50
51
Other assets including other claims on nonrelated parties
52 Net due from related depository institutions5
53
Net due from head office and other related depositorv institutions' . , .
54
Net due from establishing entity, head offices, and other related
depository institutions5
43,911
52,158
10,697
8,209
2,489
41,461
85,297
85,297
265
4,791
n.a.
n.a.
n.a.
4,791
141,976
n.a.
41,603
43,301
7,256
5,088
2,168
36,045
67,130
67,130
190
3,746
n.a.
n.a.
n.a.
3,746
1 13,889
n.a.
181
4,766
2,563
2,503
60
2,203
3,732
3,732
75
721
n.a.
n.a.
n.a.
721
18,532
n.a.
2,125
3,162
430
383
47
2,732
4,100
4,100
0
257
n.a.
n.a.
n.a.
257
5,972
n.a.
14 Total securities, book value
15
U.S. Treasury
Obligations of U.S. government agencies and corporations
16
17
Other bonds, notes, debentures, and corporate stock (including state
and local securities)
Securities of foreign governmental units
18
19
All Other
20 Federal funds sold and securities purchased under agreements to
resell
21
U.S. branches and agencies of other foreign banks
22
Commercial banks in United States
Other
23
24 Total loans, gross
25
LESS: Unearned income on loans
26
EQUALS: L o a n s , n e t
Total loans, gross, b\ category
27 Real estate loans
28 Loans to depository institutions
29
Commercial banks in United States (including IBFs)
30
U.S. branches and agencies of other foreign banks
31
Other commercial banks in United States
32
Other depository institutions in United States (including IBFs)
Banks in foreign countries
33
34
Foreign branches of U.S. banks
35
Other banks in foreign countries
36 Loans to other financial institutions
0
0
0
0
n.a.
141,976
n.a.
113.889
n.a.
18,532
n.a.
5,972
55 Total liabilities 4
786,902
321,155
605,018
259,066
74,938
34,380
62,501
18,658
56 Liabilities to nonrelated parties
659,089
298,105
548,632
242,731
52,386
33,760
36,961
14,078
U.S. Branches and Agencies
4.30
A73
A S S E T S A N D LIABILITIES of U.S. Branches and Agencies of Foreign Banks, September 30, 1995'—Continued
Millions of dollars except as noted
All states2
Item
57
58
59
60
61
6?.
63
64
65
66
67
68
69
Individuals, partnerships, and corporations
U.S. addressees (domicile)
Non-U.S. addressees (domicile)
Commercial banks in United States (including IBFs)
U.S. branches and agencies of other foreign banks
Other commercial banks in United States
Banks in foreign countries
Foreign branches of U.S. banks
Other banks in foreign countries
Foreign governments and official institutions
(including foreign central banks)
All other deposits and credit balances
Certified and official checks
70 Transaction accounts and credit balances (excluding IBFs)
Individuals, partnerships, and corporations
71
72
U.S. addressees (domicile)
Non-U.S. addressees (domicile)
73
Commercial banks in United States (including IBFs)
74
U.S. branches and agencies of other foreign banks
75
76
Other commercial banks in United States
77
Banks in foreign countries
78
Foreign branches of U.S. banks
Other banks in foreign countries
79
Foreign governments and official institutions
80
(including foreign central banks)
81
All other deposits and credit balances
Certified and official checks
82
83 Demand deposits (included in transaction accounts
and credit balances)
Individuals, partnerships, and corporations
84
85
U.S. addressees (domicile)
Non-U.S. addressees (domicile)
86
87
Commercial banks in United States (including IBFs)
88
U.S. branches and agencies of other foreign banks
89
Other commercial banks in United States
90
Banks in foreign countries
Foreign branches of U.S. banks
91
Other banks in foreign countries
92
Foreign governments and official institutions
93
(including foreign central banks)
94
All other deposits and credit balances
95
Certified and official checks
96 Nontransaction accounts (including MMDAs, excluding IBFs)
Individuals, partnerships, and corporations
97
98
U.S. addressees (domicile)
99
Non-U.S. addressees (domicile)
KM) Commercial banks in United States (including IBFs)
I0l
U.S. branches and agencies of other foreign banks
Other commercial banks in United States
102
Banks in foreign countries
103
Foreign branches of U.S. banks
104
105
Other banks in foreign countries
Foreign governments and official institutions
106
(including foreign central banks)
107
All other deposits and credit balances
108 IBF deposit liabilities
Individuals, partnerships, and corporations
109
110
U.S. addressees (domicile)
Non-U.S. addressees (domicile)
111
112
Commercial banks in United States (including IBFs)
113
U.S. branches and agencies of other foreign banks
Other commercial banks in United States
114
Banks in foreign countries
115
Foreign branches of U.S. banks
1 16
Other banks in foreign countries
117
118
Foreign governments and official institutions
(including foreign central banks)
119
All other deposits and credit balances
Footnotes appear at end of table.
Total
excluding
IBFs3
IBFs
only3
Illinois
California
New York
Total
excluding
IBFs
IBFs
only
Total
excluding
IBFs
IBFs
only
Total
excluding
IBFs
IBFs
only
175,086
120,967
108,088
12,879
32,988
18,594
14,394
8,356
2.774
5,582
226,308
14,551
203
14,348
60,460
56,162
4,298
124,416
4,721
119,695
147,276
98,598
91,764
6,834
28,947
16,146
12,800
7,806
2,618
5,188
205,006
9,953
203
9,750
56,238
52,382
3,856
114,074
4,189
109,885
5,343
4,586
2,851
1,735
350
120
230
181
0
181
7,816
599
0
599
2,270
2,093
177
4,034
269
3,765
10,947
8,320
7,456
863
2,394
1,141
1,253
159
135
24
7,284
161
0
161
1,663
1,462
201
4,456
238
4,218
3.484
9,020
270
26,842
39
3,095
8,612
217
24,702
38
198
6
22
914
0
13
53
7
1,004
1
6,611
5,151
4,099
1,052
198
21
177
615
1
614
369
295
218
76
3
0
2
39
0
39
366
352
347
6
0
0
0
2
0
2
364
126
270
321
109
217
5
6
22
3
1
7
7,664
6,094
4,614
1,480
159
6
153
779
2
778
6,304
5,021
4,037
985
154
4
149
587
1
587
316
246
182
64
1
0
1
39
0
39
353
340
335
5
0
0
0
2
0
2
8,272
6,500
4,789
1,711
204
22 '
183
808
2
806
n d.
n.a.
n.a.
296
66
270
270
54
217
4
2
22
3
1
7
166 814
114,467
103,299
11,168
32,784
18,573
14,211
7,549
2,772
4,776
140,665
93,447
87,665
5,782
28,749
16,126
12,623
7,191
2 617
4,574
4,973
4,292
2,633
1,659
347
120
227
141
0
141
10,581
7,967
7,109
858
2,394
1,141
1,252
158
135
23
3,120
8,895
2,774
8,504
193
0
n.a.
10
52
n.a.
226,308
14,551
203
14,348
60,460
56,162
4,298
124,416
4,721
119,695
26,842
39
n.a.
205,006
9,953
203
9,750
56,238
52,382
3,856
114,074
4,189
109,885
24,702
38
n.a.
7,816
599
0
599
2,270
2,093
177
4,034
269
3,765
914
0
n.a.
7,284
161
0
161
1,663
1,462
201
4,456
238
4,218
1,004
1
A74
4.30
Special Tables • February 1996
ASSETS AND LIABILITIES of U.S. Branches and Agencies of Foreign Banks, September 30, 1995'—Continued
Millions of dollars except as noted
All statesTotal
including
IBFs1
120 Federal funds purchased and securities sold under agreements to
repurchase
121
U.S. branches and agencies of other foreign banks
122
Other commercial banks in United States
123
Other
124 Other borrowed money
125 Owed to nonrelated commercial banks in United States (including
IBFs)
126
Owed to U.S. offices of nonrelated U.S. banks
127
Owed to U.S. branches and agencies of nonrelated
foreign banks
128 Owed to nonrelated banks in foreign countries
129
Owed to foreign branches of nonrelated U.S. banks
130
Owed to foreign offices of nonrelated foreign banks
131 Owed to others
132 All other liabilities
133
Branch or agency liability on acceptances executed and
outstanding
134
Trading liabilities
135
Other liabilities to nonrelated parties
136 Net due to related depository institutions5
137
Net owed to head office and other related depository institutions'. .
138
Net owed to establishing entity, head office, and other related
depository institutions5
IBFs
only-1
Total
including
IBFs
IBFs
only
12,946
2,276
Total
including
IBFs
IBFs
only
Total
including
IBFs
3,672
1,796
34
1,842
21,668
2,883
727
545
1,611
11,980
70,628
11,123
7,218
52,287
100,461
18,137
4,541
146
13,450
48,528
60,868
7,431
5,110
48,327
57,545
10,558
20,460
6,265
2,871
1,501
1,893
28,995
32,737
9,429
16,933
1,898
13,636
5,815
4,335
499
15,224
2,612
10,815
1,281
2,623
628
23,308
32,473
1,712
30,761
35,251
15,034
29,216
1,607
27,608
2,379
7,821
17,607
458
17,149
26,302
3,836
14,638
421
14,217
1,487
12,612
9,534
10,525
727
9,798
329
1,995
3,654
460
3,194
5,704
86,606
4,320
3,968
112
10,659
752
9,907
3,112
3,866
5,132
77,937
11,214
39,873
35,519
75
5,057
7,751
38,623
31,563
74
4,246
1,338
2
602
2,304
127,813
127,813
23,050
n.a.
56,386
56,386
16,334
n.a.
22,552
22,552
620
n.a.
25,540
25,540
2,524
106
442
1,120
620
16,334
23,050
MEMO
139 Non-interest-bearing balances with commercial banks
in United States
140 Holding of commercial paper included in total loans
141 Holding of own acceptances included in commercial and
industrial loans
142 Commercial and industrial loans with remaining maturity of one year
or less
143
Predetermined interest rates
144
Floating interest rates
145 Commercial and industrial loans with remaining maturity of more
than one year
146
Predetermined interest rates
147
Floating interest rates
979
654
0
727
580
0
4,453
3,160
1,105
111,179
64,400
46,780
62,216
36,844
25,372
19,119
10,327
8,793
17,542
12,183
5,359
79,997
19,686
60,311
46,133
12,097
34,036
12,656
2,594
10.062
11,339
3,513
7,826
U.S. Branches and Agencies
4.30
A75
ASSETS A N D LIABILITIES of U.S. Branches and Agencies of Foreign Banks, September 30, 1995'—Continued
Millions of dollars except as noted
All states 2
Item
148 Components of total nontransaction accounts,
included in total deposits and credit balances of
nontransaction accounts, including IBFs
149
Time CDs in denominations of $100,000 or more
150
Other time deposits in denominations of $100,000
or more
151
Time CDs in denominations of $100,000 or more
with remaining maturity of more than 12 months
Illinois
IBFs
only3
Total
excluding
IBFs
IBFs
only
Total
excluding
IBFs
IBFs
only
Total
excluding
IBFs
IBFs
only
168,719
133,771
n.a.
n.a.
142,924
112,434
n.a.
n.a.
5,462
3,478
n.a.
n.a.
10,743
9,144
n.a.
n.a.
27,720
n.a.
24,665
n.a.
1,058
n.a.
1,238
n.a.
7,228
n.a.
5,825
n.a.
926
n.a.
362
n.a.
Total
including
IBFs
0
58,090
532
1. Data are aggregates of categories reported on the quarterly form FFIEC 002, "Report of
Assets and Liabilities of U.S. Branches and Agencies of Foreign Banks." The form was first
used for reporting data as of June 30, 1980, and was revised as of December 31, 1985. From
November 1972 through May 1980, U.S. branches and agencies of foreign banks had filed a
monthly FR 886a report. Aggregate data from that report were available through the Federal
Reserve monthly statistical release G. 11, last issued on July 10, 1980. Data in this table and in
the G.l I 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). Since December 31, 1985, data for IBFs have been reported in a separate column.
These data are either included in or excluded from the total columns as indicated in the
headings. The notation "n.a." indicates that no IBF data have been reported for that item,
California
Total
excluding
IBFs 3
All states
152 Market value of securities held
153 Immediately available funds with a maturity greater than one day
included in other borrowed money
154 Number of reports filed 6
New York
2
New York
IBFs
only
0
Total
including
IBFs
0
n.a.
0
29,280
252
California
IBFs
only
0
n.a.
0
Total
including
IBFs
0
20,983
122
Illinois
IBFs
only
0
n.a.
0
Total
including
IBFs
0
6,605
47
IBFs
only
0
n.a.
0
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 owed to related
banking institutions in the United States and in foreign countries (see note 5). On the former
monthly branch and agency report, available through the G . l l monthly 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. 11 tables.
5. Related depository institutions includes the foreign head office and other U.S. and
foreign branches and agencies of a bank, a bank's parent holding company, and majorityowned banking subsidiaries of the bank and of its parent holding company (including
subsidiaries owned both directly and indirectly).
6. In some cases two or more offices of a foreign bank within the same metropolitan area
file a consolidated report.
76
Index to Statistical Tables
References are to pages A3-A75 although the prefix "A" is omitted in this index
ACCEPTANCES, bankers (See Bankers acceptances)
Agricultural loans, commercial banks, 21, 22
Assets and liabilities (See also Foreigners)
Banks, by classes, 18-23
Domestic finance companies, 36
Federal Reserve Banks, 11
Financial institutions, 28
Foreign banks, U.S. branches and agencies, 23, 72-75
Automobiles
Consumer installment credit, 39
Production, 47, 48
Deposits—Continued
Federal Reserve Banks, 5,11
Interest rates, 16
Turnover, 17
Discount rates at Reserve Banks and at foreign central banks and
foreign countries (See Interest rates)
Discounts and advances by Reserve Banks (See Loans)
Dividends, corporate, 35
BANKERS acceptances, 11, 12, 21-24, 26
Bankers balances, 18-23, 72-75. (See also Foreigners)
Bonds (See also U.S. government securities)
New issues, 34
Rates, 26
Branch banks, 23
Business activity, nonfinancial, 45
Business loans (See Commercial and industrial loans)
FARM mortgage loans, 38
Federal agency obligations, 5, 10, 11, 12, 31, 32
Federal credit agencies, 33
Federal finance
Debt subject to statutory limitation, and types and ownership
of gross debt, 30
Receipts and outlays, 28, 29
Treasury financing of surplus, or deficit, 28
Treasury operating balance, 28
Federal Financing Bank, 33
Federal funds, 7, 21, 22, 23, 26, 28
Federal Home Loan Banks, 33
Federal Home Loan Mortgage Corporation, 33, 37, 38
Federal Housing Administration, 33, 37, 38
Federal Land Banks, 38
Federal National Mortgage Association, 33, 37, 38
Federal Reserve Banks
Condition statement, 11
Discount rates (See Interest rates)
U.S. government securities held, 5, 11, 12, 30
Federal Reserve credit, 5, 6, 11, 12
Federal Reserve notes, 11
Federally sponsored credit agencies, 33
Finance companies
Assets and liabilities, 36
Business credit, 36
Loans, 39
Paper, 24, 26
Financial institutions, loans to, 21, 22, 23
Float, 5
How of funds, 40-44
Foreign banks, assets and liabilities of U.S. branches and
agencies, 22, 23, 72-75
Foreign currency operations, 11
Foreign deposits in U.S. banks, 5, 22
Foreign exchange rates, 66
Foreign trade, 54
Foreigners
Claims on, 55, 58, 59, 60, 62
Liabilities to, 22, 54, 55, 56, 61, 63, 64
CAPACITY utilization, 46
Capital accounts
Banks, by classes, 18
Federal Reserve Banks, 11
Central banks, discount rates, 65
Certificates of deposit, 26
Commercial and industrial loans
Commercial banks, 21, 22
Weekly reporting banks, 21-23
Commercial banks
Assets and liabilities, 18-23, 68-71
Commercial and industrial loans, 18-23
Consumer loans held, by type and terms, 39
Deposit interest rates of insured, 16
Loans sold outright, 22
Real estate mortgages held, by holder and property, 38
Terms of lending, 68-71
Time and savings deposits, 4
Commercial paper, 24, 26, 36
Condition statements (See Assets and liabilities)
Construction, 45, 49
Consumer installment credit, 39
Consumer prices, 45
Consumption expenditures, 52, 53
Corporations
Profits and their distribution, 35
Security issues, 34, 65
Cost of living (See Consumer prices)
Credit unions, 39
Currency in circulation, 5, 14
Customer credit, stock market, 27
DEBITS to deposit accounts, 17
Debt (See specific types of debt or securities)
Demand deposits
Banks, by classes, 18-23
Ownership by individuals, partnerships, and
corporations, 22, 23
Turnover, 17
Depository institutions
Reserve requirements, 9
Reserves and related items, 4, 5, 6, 13
Deposits (See also specific types)
Banks, by classes, 4, 18-23
EMPLOYMENT, 45
Eurodollars, 26
GOLD
Certificate account, 11
Stock, 5, 54
Government National Mortgage Association, 33, 37, 38
Gross domestic product, 51
HOUSING, new and existing units, 49
INCOME, personal and national, 45, 51, 52
Industrial production, 45, 47
Installment loans, 39
All
Insurance companies, 30, 38
Interest rates
Bonds, 26
Commercial banks, 68-71
Consumer installment credit, 39
Deposits, 16
Federal Reserve Banks, 8
Foreign central banks and foreign countries, 65
Money and capital markets, 26
Mortgages, 37
Prime rate, 25
International capital transactions of United States, 53-65
International organizations, 55, 56, 58, 61, 62
Inventories, 51
Investment companies, issues and assets, 35
Investments (See also specific types)
Banks, by classes, 18-23
Commercial banks, 4, 18-23
Federal Reserve Banks, 11,12
Financial institutions, 38
LABOR force, 45
Life insurance companies (See Insurance companies)
Loans (See also specific types)
Banks, by classes, 18-23
Commercial banks, 18-23
Federal Reserve Banks, 5, 6, 8, 11, 12
Financial institutions, 38
Insured or guaranteed by United States, 37, 38
MANUFACTURING
Capacity utilization, 46
Production, 46, 48
Margin requirements, 27
Member banks (See also Depository institutions)
Federal funds and repurchase agreements, 7
Reserve requirements, 9
Mining production, 48
Mobile homes shipped, 49
Monetary and credit aggregates, 4, 13
Money and capital market rates, 26
Money stock measures and components, 4, 14
Mortgages (See Real estate loans)
Mutual funds, 35
Mutual savings banks (See Thrift institutions)
NATIONAL defense outlays, 29
National income, 51
OPEN market transactions, 10
PERSONAL income, 52
Prices
Consumer and producer, 45, 50
Stock market, 27
Prime rate, 25
Producer prices, 45, 50
Production, 45, 47
Profits, corporate, 35
REAL estate loans
Banks, by classes, 21, 22, 38
Terms, yields, and activity, 37
Type of holder and property mortgaged, 38
Repurchase agreements, 7
Reserve requirements, 9
Reserves
Commercial banks, 18
Depository institutions, 4, 5, 6, 13
Federal Reserve Banks, 11
U.S. reserve assets, 54
Residential mortgage loans, 37
Retail credit and retail sales, 39, 45
SAVING
Flow of funds, 40-44
National income accounts, 51
Savings institutions, 38, 39, 40
Savings deposits (See Time and savings deposits)
Securities (See also specific types)
Federal and federally sponsored credit agencies, 33
Foreign transactions, 63
New issues, 34
Prices, 27
Special drawing rights, 5, 11, 53, 54
State and local governments
Deposits, 21, 22
Holdings of U.S. government securities, 30
New security issues, 34
Ownership of securities issued by, 21, 23
Rates on securities, 26
Stock market, selected statistics, 27
Stocks (See also Securities)
New issues, 34
Prices, 27
Student Loan Marketing Association, 33
TAX receipts, federal, 29
Thrift institutions, 4. (See also Credit unions and Savings
institutions)
Time and savings deposits, 4, 14, 16, 18-23
Trade, foreign, 54
Treasury cash, Treasury currency, 5
Treasury deposits, 5, 11, 28
Treasury operating balance, 28
UNEMPLOYMENT, 45
U.S. government balances
Commercial bank holdings, 18-23
Treasury deposits at Reserve Banks, 5, 11, 28
U.S. government securities
Bank holdings, 18-23, 30
Dealer transactions, positions, and financing, 32
Federal Reserve Bank holdings, 5, 11, 12, 30
Foreign and international holdings and
transactions, 11, 30, 64
Open market transactions, 10
Outstanding, by type and holder, 30, 31
Rates, 26
U.S. international transactions, 53-66
Utilities, production, 48
VETERANS Administration, 37, 38
WEEKLY reporting banks, 18-23
Wholesale (producer) prices, 45, 50
YIELDS (See Interest rates)
78
Federal Reserve Board of Governors
and Official Staff
ALAN GREENSPAN, Chairman
EDWARD W. KELLEY, JR.
LAWRENCE B . LINDSEY
OFFICE
DIVISION OF INTERNATIONAL
FINANCE
EDWIN M . TRUMAN, Staff Director
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
THOMAS A . CONNORS, Assistant Director
PETER HOOPER III, Assistant Director
KAREN H . JOHNSON, Assistant Director
CATHERINE L . MANN, Assistant Director
RALPH W . SMITH, JR., Assistant Director
OF BOARD
MEMBERS
JOSEPH R . COYNE, Assistant to the Board
DONALD J. WINN, Assistant to the Board
THEODORE E . ALLISON, Assistant to the Board for
Federal
Reserve System Affairs
LYNN S. FOX, Deputy Congressional Liaison
WINTHROP P. HAMBLEY, Special Assistant to the Board
BOB STAHLY MOORE, Special Assistant to the Board
DIANE E . WERNEKE, Special Assistant to the Board
PORTIA W . THOMPSON, Equal Employment Opportunity
Programs Adviser
LEGAL
DIVISION
J. VIRGIL MATTINGLY, JR., General Counsel
SCOTT G . ALVAREZ, Associate General Counsel
RICHARD M . ASHTON, Associate General Counsel
OLIVER IRELAND, Associate General Counsel
KATHLEEN M . O'DAY, Associate General Counsel
ROBERT DEV. FRIERSON, Assistant General Counsel
KATHERINE H . WHEATLEY, Assistant General Counsel
OFFICE OF THE
SECRETARY
WILLIAM W . WILES, Secretary
JENNIFER J. JOHNSON, Deputy Secretary
BARBARA R . LOWREY, Associate Secretary and
1
DAY W . RADEBAUGH, JR., Assistant Secretary
Ombudsman
DIVISION OF BANKING
SUPERVISION AND REGULATION
RICHARD SPILLENKOTHEN, Director
STEPHEN C . SCHEMERING, Deputy Director
DON E . KLINE, Associate Director
WILLIAM A . RYBACK, 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
STEPHEN M . HOFFMAN, JR., Assistant Director
LAURA M . HOMER, Assistant Director
JAMES V. HOUPT, Assistant Director
JACK P. JENNINGS, Assistant Director
MICHAEL G . MARTINSON, Assistant Director
RHOGER H PUGH, Assistant Director
SIDNEY M . SUSSAN, Assistant Director
MOLLY S. WASSOM, Assistant Director
WILLIAM SCHNEIDER, Project Director,
National Information Center
1. On loan from the Division of Information Resources
Management.
DIVISION
OF RESEARCH
AND
STATISTICS
MICHAEL J. PRELL, Director
EDWARD C . ETTIN, Deputy Director
DAVID J. STOCKTON, Deputy Director
MARTHA BETHEA, Associate Director
WILLIAM R . JONES, Associate Director
MYRON L. KWAST, Associate Director
PATRICK M . PARKINSON, Associate Director
THOMAS D . SIMPSON, Associate Director
LAWRENCE SLIFMAN, Associate Director
MARTHA S. SCANLON, Deputy Associate Director
PETER A . TINSLEY, Deputy Associate Director
FLINT BRAYTON, Assistant Director
DAVID S. JONES, Assistant Director
STEPHEN A . RHOADES, Assistant Director
CHARLES S. STRUCKMEYER, Assistant Director
ALICE PATRICIA WHITE, Assistant Director
JOYCE K. ZICKLER, Assistant Director
JOHN J. MINGO, Senior Adviser
GLENN B . CANNER, Adviser
DIVISION
OF MONETARY
AFFAIRS
DONALD L. KOHN, Director
DAVID E . LINDSEY, Deputy Director
BRIAN F. MADIGAN, Associate Director
RICHARD D . PORTER, Deputy Associate Director
VINCENT R . REINHART, Assistant Director
NORMAND R.V. BERNARD, Special Assistant to the
DIVISION OF CONSUMER
AND COMMUNITY AFFAIRS
GRIFFITH L . GARWOOD, Director
GLENN E. LONEY, Associate Director
DOLORES S. SMITH, Associate Director
MAUREEN P. ENGLISH, Assistant Director
IRENE SHAWN MCNULTY, Assistant Director
Board
79
SUSAN M . PHILLIPS
JANET L . YELLEN
OFFICE OF
STAFF DIRECTOR
FOR
MANAGEMENT
S. DAVID FROST, Staff Director
SHEILA CLARK, EEO Programs
Director
DIVISION OF HUMAN RESOURCES
MANAGEMENT
DAVID L . SHANNON, Director
JOHN R . WEIS, Associate Director
ANTHONY V. DIGIOIA, Assistant Director
JOSEPH H . HAYES, JR., Assistant Director
FRED HOROWITZ, Assistant Director
OFFICE OF THE
CONTROLLER
GEORGE E . LIVINGSTON, Controller
STEPHEN J. CLARK, Assistant Controller (Programs and Budgets)
DARRELL R . PAULEY, Assistant Controller (Finance)
DIVISION OF SUPPORT SERVICES
ROBERT E. FRAZIER, Director
GEORGE M . LOPEZ, Assistant Director
DAVID L . WILLIAMS, Assistant Director
DIVISION OF INFORMATION RESOURCES
MANAGEMENT
STEPHEN R . MALPHRUS, Director
MARIANNE M . EMERSON, Assistant Director
Po KYUNG KIM, Assistant Director
RAYMOND H . MASSEY, Assistant Director
EDWARD T. MULRENIN, Assistant Director
ELIZABETH B . RIGGS, Assistant Director
RICHARD C . STEVENS, Assistant Director
DIVISION OF RESERVE BANK OPERATIONS
AND PAYMENT SYSTEMS
CLYDE H . FARNSWORTH, JR., Director
DAVID L . ROBINSON, Deputy Director (Finance and Control)
LOUISE L . ROSEMAN, Associate Director
CHARLES W. BENNETT, Assistant Director
JACK DENNIS, JR., Assistant Director
EARL G . HAMILTON, Assistant Director
JEFFREY C . MARQUARDT, Assistant Director
JOHN H . PARRISH, Assistant Director
FLORENCE M . YOUNG, Assistant Director
OFFICE OF THE INSPECTOR GENERAL
Inspector General
DONALD L . ROBINSON, Assistant Inspector General
BARRY R . SNYDER, Assistant Inspector General
BRENT L . BOWEN,
80
Federal Reserve Bulletin • February 1996
Federal Open Market Committee
and Advisory Councils
FEDERAL
OPEN MARKET
COMMITTEE
MEMBERS
ALAN GREENSPAN,
Chairman
WILLIAM J. MCDONOUGH,
LAWRENCE B . LINDSEY
ROBERT D . MCTEER, JR.
SUSAN M . PHILLIPS
EDWARD G . BOEHNE
JERRY L . JORDAN
EDWARD W . KELLEY, JR.
Vice Chairman
GARY H . STERN
JANET L . YELLEN
ALTERNATE MEMBERS
MICHAEL H . MOSKOW
ROBERT T. PARRY
J. ALFRED BROADDUS, JR.
JACK GUYNN
ERNEST T. PATRIKIS
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
THOMAS C . BAXTER, JR., Deputy General Counsel
MICHAEL J. PRELL, Economist
EDWIN M . TRUMAN, Economist
RICHARD W. LANG, Associate Economist
DAVID E . LINDSEY, Associate Economist
FREDERIC S. MISHKIN, Associate Economist
LARRY J. PROMISEL, Associate Economist
ARTHUR J. ROLNICK, Associate Economist
HARVEY ROSENBLUM, Associate Economist
CHARLES J. SIEGMAN, Associate Economist
THOMAS D . SIMPSON, Associate Economist
MARK S. SNIDERMAN, Associate Economist
DAVID J. STOCKTON, Associate Economist
PETER R . FISHER,
FEDERAL
ADVISORY
Manager, System Open Market Account
COUNCIL
ROGER L. FITZSIMONDS, Seventh District
THOMAS M. JACOBSEN, Eighth District
RICHARD M. KOVACEVICH, Ninth District
WILLIAM M. CROZIER, JR., First District
WALTER V. SHIPLEY, Second District
WALTER E. DALLER, JR., Third District
FRANK V. CAHOUET, Fourth District
RICHARD G. TILGHMAN, Fifth District
CHARLES E. NELSON, Tenth District
CHARLES T. DOYLE, Eleventh District
WILLIAM E. B. SIART, Twelfth District
CHARLES E. RICE, Sixth District
Secretary Emeritus
Co-Secretary
KORSVIK, Co-Secretary
HERBERT V. PROCHNOW,
JAMES ANNABLE,
WILLIAM J.
81
CONSUMER ADVISORY
COUNCIL
KATHARINE W. MCKEE, Durham, North Carolina, Chairman
JULIA M . SEWARD, Richmond, Virginia, Vice Chairman
RICHARD AMADOR, LOS A n g e l e s , C a l i f o r n i a
THOMAS R. BUTLER, Riverwoods, Illinois
ROBERT A. COOK, Baltimore, Maryland
ALVIN J. COWANS, Orlando, Florida
ELIZABETH G. FLORES, Laredo, Texas
HERIBERTO FLORES, Springfield, Massachusetts
EMANUEL FREEMAN, P h i l a d e l p h i a , P e n n s y l v a n i a
DAVID C. FYNN, Cleveland, Ohio
ROBERT G. GREER, Houston, Texas
KENNETH R. HARNEY, Chevy Chase, Maryland
ERROL T. LOUIS, Brooklyn, New York
WILLIAM N. LUND, Augusta, Maine
RONALD A. PRILL, Minneapolis, Minnesota
LISA RICE-COLEMAN, T o l e d o , O h i o
JOHN R. RINES, Detroit, Michigan
MARGOT SAUNDERS, W a s h i n g t o n , D . C .
ANNE B. SHLAY, Philadelphia, Pennsylvania
REGINALD J. SMITH, Kansas City, Missouri
TERRY JORDE, Cando, North Dakota
FRANCINE JUSTA, New York, New York
GEORGE P. SURGEON, A r k a d e l p h i a , A r k a n s a s
GREGORY D . SQUIRES, M i l w a u k e e , W i s c o n s i n
JOHN E . TAYLOR, W a s h i n g t o n , D . C .
LORRAINE VANETTEN, T r o y , M i c h i g a n
THEODORE J. WYSOCKI, JR., C h i c a g o , Illinois
EUGENE I. LEHRMANN, M a d i s o n , W i s c o n s i n
LILY K. YAO, Honolulu, Hawaii
GAIL K . HILLEBRAND, S a n F r a n c i s c o , C a l i f o r n i a
THRIFT INSTITUTIONS ADVISORY
COUNCIL
E. LEE BEARD, Hazleton, Pennsylvania, President
Burlington, Massachusetts, Vice President
DAVID F. HOLLAND,
CHARLES R . RINEHART, I r w i n d a l e , C a l i f o r n i a
BARRY C . BURKHOLDER, H o u s t o n , T e x a s
MICHAEL T. CROWLEY, JR., M i l w a u k e e , W i s c o n s i n
JOSEPH C. SCULLY, Chicago, Illinois
GEORGE L. ENGELKE, JR., Lake Success, New York
RONALD W . STIMPSON, M e m p h i s , T e n n e s s e e
DOUGLAS A . FERRARO, E n g l e w o o d , C o l o r a d o
LARRY T. WILSON, Raleigh, North Carolina
WILLIAM W. ZUPPE, Spokane, Washington
BEVERLY D. HARRIS, Livingston, Montana
82
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For ordering assistance, write PUBLICATIONS SERVICES,
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THE FEDERAL RESERVE SYSTEM—PURPOSES AND FUNCTIONS.
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EDUCATION
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
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
How to File a Consumer Complaint
Making Deposits: When Will Your Money Be Available?
Making Sense of Savings
SHOP: The Card You Pick Can Save You Money
Welcome to the Federal Reserve
When Your Home is on the Line: What You Should Know
About Home Equity Lines of Credit
83
STAFF STUDIES: Only Summaries Printed in the
BULLETIN
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.
162. EVIDENCE ON THE SIZE OF BANKING MARKETS FROM MORTGAGE LOAN RATES IN TWENTY CITIES, b y S t e p h e n A .
Rhoades. February 1992. 11 pp.
163. CLEARANCE AND SETTLEMENT IN U . S . SECURITIES MAR-
KETS, by Patrick Parkinson, Adam Gilbert, Emily Gollob,
Lauren Hargraves, Richard Mead, Jeff Stehm, and Mary
Ann Taylor. March 1992. 37 pp.
164. THE
Staff Studies 1-157 are out of print.
1989-92
CREDIT CRUNCH FOR REAL ESTATE,
by
James T. Fergus and John L. Goodman, Jr. July 1993.
20 pp.
158. THE ADEQUACY AND CONSISTENCY OF MARGIN REQUIREMENTS IN THE MARKETS FOR STOCKS AND DERIVATIVE
165. THE DEMAND FOR TRADE CREDIT: A N INVESTIGATION OF
MOTIVES FOR TRADE CREDIT USE BY SMALL BUSINESSES, b y
PRODUCTS, by Mark J. Warshawsky with the assistance of
Dietrich Earnhart. September 1989. 23 pp.
Gregory E. Elliehausen and John D. Wolken. September
1 9 9 3 . 18 pp.
159. NEW DATA ON THE PERFORMANCE OF NONBANK SUBSIDIARIES OF BANK HOLDING COMPANIES, b y N e l l i e L i a n g a n d
166. THE ECONOMICS OF THE PRIVATE PLACEMENT MARKET, b y
Donald Savage. February 1990. 12 pp.
160. BANKING MARKETS AND THE USE OF FINANCIAL SERVICES BY SMALL AND MEDIUM-SIZED BUSINESSES, b y
Gregory E. Elliehausen and John D. Wolken. September
1990. 35 pp.
161. A
REVIEW OF CORPORATE
RESTRUCTURING
ACTIVITY,
1980-90, by Margaret Hastings Pickering. May 1991.
21pp.
Mark Carey, Stephen Prowse, John Rea, and Gregory Udell.
January 1994. I l l pp.
167. A SUMMARY OF MERGER PERFORMANCE STUDIES IN BANKING, 1 9 8 0 - 9 3 , AND AN ASSESSMENT OF THE "OPERATING
PERFORMANCE" AND "EVENT STUDY" METHODOLOGIES,
by Stephen A. Rhoades. July 1994. 37 pp.
168. THE ECONOMICS OF THE PRIVATE EQUITY MARKET,
by
George W. Fenn, Nellie Liang, and Stephen Prowse. November 1 9 9 5 . 6 9 pp.
84
Maps of the Federal Reserve System
1
9
12
BOSTON
2
MINNEAPOLIS
_
CHICAGO!
N
CLEVELAND
4
SAN FRANCISCO
KANSAS CITY I
• NEW YORK
PHILADELPHIA
|
RICHMOND
ST. LOUIS
6
ATLANTA
DALLAS
ALASKA
HAWAII
LEGEND
Both pages
• Federal Reserve Bank city
• Board of Governors of the Federal
Facing page
• Federal Reserve Branch city
— Branch boundary
Reserve System, Washington, D.C.
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.
85
2-B
1-A
4-D
3-C
5-E
Pittsburgh
1
f
\
VT
Ktt
/
VA
wv
•Cincinnati
/
MD
H
—
C
T
Buffalo
MA 1
Baltimore
5ic
• Charlotte
N
Y
CT
sc
NEW YORK
BOSTON
PHILADELPHIA
6-F
RICHMOND
CLEVELAND
8-H
7-G
•Nashville
/
IN 5 /
Birmingham
K
Y
Louisville
Jacksonville
LA
•Memphis
Littl^
Ft
New Orleans
J Miami
CHICAGO
ATLANTA
ST. LOUIS
9-1
so
MINNEAPOLIS
12-L
10-J
Omaha*
-!> M
O
Defter
Oklahonm City
KANSAS CITY
11-K
Lake City
A
RJ~~R~VHOUSTC
•Los Angeles
San AiSCllio
DALLAS
SAN FRANCISCO
86
Federal Reserve Banks, Branches,
and Offices
Chairman
FEDERAL RESERVE BANK
branch, or facility
Zip
Deputy Chairman
President
First Vice President
BOSTON*
02106 Jerome H. Grossman
William C. Brainard
Cathy E. Minehan
Paul M. Connolly
NEW YORK*
10045 John C. Whitehead
Thomas W. Jones
14240 Joseph J. Castiglia
William J. McDonough
Ernest T. Patrikis
PHILADELPHIA
19105 Donald J. Kennedy
Joan Carter
Edward G. Boehne
William H. Stone, Jr.
CLEVELAND*
44101 A. William Reynolds
G. Watts Humphrey, Jr.
45201 John N. Taylor, Jr.
15230 John T. Ryan III
Jerry L. Jordan
Sandra Pianalto
23219 Claudine B. Malone
Robert L. Strickland
21203 Michael R. Watson
28230 James O. Roberson
22701
J. Alfred Broaddus, Jr.
Walter A. Varvel
30303 Hugh M. Brown
Daniel E. Sweat, Jr.
35283 Donald E. Boomershine
32231 Joan D. Ruffier
33152 R. Kirk Landon
37203 Paula Lovell
70161 Lucimarian Roberts
Jack Guynn
Temporarily vacant
60690 Robert M. Healey
Lester H. McKeever, Jr.
48231 John D. Forsyth
Michael H. Moskow
William C. Conrad
63166 John F. McDonnell
Susan S. Elliott
72203 To be announced
40232 John A. Williams
38101 John V. Myers
Thomas C. Melzer
W. LeGrande Rives
55480 Jean D. Kinsey
David A. Koch
59601 Lane W. Basso
Gary H. Stern
Colleen K. Strand
64198 Herman Cain
A. Drue Jennings
80217 Peter I. Wold
73125 Barry L. Eller
68102 LeRoy W. Thorn
Thomas M. Hoenig
Richard K. Rasdall
75201 Cece Smith
Roger R. Hemminghaus
79999 Patricia Z. Holland-Branch
77252 I. H. Kempner III
78295 Carol L. Thompson
Robert D. McTeer, Jr.
Tony J. Salvaggio
94120 Judith M. Runstad
James A. Vohs
90051 Anita E. Landecker
97208 Ross R. Runkel
84125 Gerald R. Sherratt
98124 George F. Russell, Jr.
Robert T. Parry
Patrick K. Barron
Buffalo
Cincinnati
Pittsburgh
RICHMOND*
Baltimore
Charlotte
Culpeper
ATLANTA
Birmingham
Jacksonville
Miami
Nashville
New Orleans
CHICAGO*
Detroit
ST. LOUIS
Little Rock
Louisville
Memphis
MINNEAPOLIS
Helena
KANSAS CITY
Denver
Oklahoma City
Omaha
DALLAS
El Paso
Houston
San Antonio
SAN FRANCISCO ....
Los Angeles
Portland
Salt Lake City
Seattle
Vice President
in charge of branch
Carl W. Turnipseed1
Charles A. Cerino1
Harold J. Swart1
William J. Tignanelli1
Dan M. Bechter1
Julius Malinowski, Jr.2
Donald E. Nelson1
Fred R. Herr1
James D. Hawkins1
James T. Curry III
Melvyn K. Purcell
Robert J. Musso
David R. Allardice1
Robert A. Hopkins
Howard Wells
John P. Baumgartner
John D. Johnson
Kent M. Scott1
Mark L. Mullinix
Harold L. Shewmaker
Sammie C. Clay
Robert Smith, 1 1
III
James L. Stull
John F. Moore3
Raymond H. Laurence
Andrea P. Wolcott
Gordon Werkema1
•Additional offices of these Banks are located at Lewiston, Maine 04240; Windsor Locks, Connecticut 06096; East Rutherford, New Jersey 07016; Jericho,
New York 11753; Utica at Oriskany, New York 13424; Columbus, Ohio 43216; Columbia, South Carolina 29210; Charleston, West Virginia 25311;
Des Moines, Iowa 50306; Indianapolis, Indiana 46204; Milwaukee, Wisconsin 53202; and Peoria, Illinois 61607.
1. Senior Vice President.
2. Assistant Vice President.
3. Executive Vice President.
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 subscription.
For further information regarding a subscription to
the economic bulletin board, please call (202) 4821986. The releases transmitted to the economic bulletin board, on a regular basis, are the following:
Reference
Number
Statistical release
Frequency of release
H.3
Aggregate Reserves
Weekly/Thursday
H.4.1
Factors Affecting Reserve Balances
Weekly/Thursday
H.6
Money Stock
Weekly/Thursday
H.8
Assets and Liabilities of Insured Domestically Chartered
and Foreign Related Banking Institutions
Weekly/Monday
H.10
Foreign Exchange Rates
Weekly/Monday
H.15
Selected Interest Rates
Weekly/Monday
G.5
Foreign Exchange Rates
Monthly/end of month
G.17
Industrial Production and Capacity Utilization
Monthly/midmonth
G.19
Consumer Installment Credit
Monthly/fifth business day
Z.7
Flow of Funds
Quarterly
Publications of Interest
FEDERAL RESERVE CONSUMER CREDIT
PUBLICATIONS
The Federal Reserve Board publishes a series of pamphlets covering individual credit laws and topics, as
pictured below.
Three booklets on the mortgage process are available:
A Consumer's Guide to Mortgage Lock-Ins, A Consumer's Guide to Mortgage Refinancings, and A Consumer's
Guide to Mortgage Settlement Costs. These booklets
were prepared in conjunction with the Federal Home
Loan Bank Board and in consultation with other federal
agencies and trade and consumer groups. The Board
also publishes the Consumer Handbook to Credit Protection Laws, a complete guide to 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.
Shop . . . The Card You Pick Can Save You Money is
designed to help consumers comparison shop when
looking for a credit card. It contains the results of the
Federal Reserve Board's survey of the terms of credit
card plans offered by credit card issuers throughout the
United States. Because the terms can affect the amount
an individual pays for using a credit card, the booklet
lists the annual percentage rate (APR), annual fee, grace
period, type of pricing (fixed or variable rate), and a
telephone number for each card issuer surveyed.
Copies of consumer publications are available free
of charge from Publications Services, Mail Stop 127,
Board of Governors of the Federal Reserve System,
Washington, DC 20551. Multiple copies for classroom
use are also available free of charge.
^S Tr*
t E i"
Costs
A Guide to
Business
Credit
for Women,
Minorities, and
Small Businesses
SHOP
m
Tha Card You Pick
Can Save You Money
@FedFRASER