Full text of Federal Reserve Bulletin : June 1983
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VOLUME 6 9 •
NUMBER 6 •
JUNE 1983
FEDERAL RESERVE
BULLETIN
Board of Governors of the Federal Reserve System
Washington, D.C.
PUBLICATIONS COMMITTEE
Joseph R. Coyne, Chairman • Stephen H. Axilrod • Michael Bradfield • S. David Frost
Griffith L. Garwood • James L. Kichline • Edwin M. Truman
Naomi P. Salus, Coordinator
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 Unit headed by Mendelle T. Berenson.
the Graphic Communications Section under the direction of Peter G. Thomas, and Publications Services supervised by Helen L. Hulen.
Table of Contents
395
DEVELOPMENTS
IN
ELECTRONIC FUND
Proposal to revise the Board's rules regarding loans by state member banks to certain
insiders; proposal to update and revise Regulation Y.
CONSUMER
TRANSFERS
All evidence points to a continuing rapid
growth in the volume of consumer electronic fund transfers, and compliance costs for
each EFT transaction are likely to fall.
404
FOREIGN
INTERIM
EXCHANGE
REPORT
OPERATIONS.-
During the February-April period under
review, the dollar generally held steady
against most currencies.
409
INDUSTRIAL
PRODUCTION
Output rose about 1.1 percent in May.
411
ST A TEMENT TO
CONGRESS
Preston Martin, Vice Chairman, Board of
Governors, discusses the current employment situation and says that with a responsible fiscal policy to complement the monetary policies now in place the recovery can
prove to be a durable one, associated with
rising living standards and increased employment, before the Subcommittee on Domestic Monetary Policy of the House Committee on Banking, Finance and Urban
Affairs, June 1, 1983.
416
ANNOUNCEMENTS
Nominations for upcoming vacancies on the
Consumer Advisory Council.
Amendments to Regulation K to authorize
investments in export trading companies.
Revision of Regulation T.
Publication of a revised list of over-thecounter stocks that are subject to margin
regulations.
Admission of three state banks to membership in the Federal Reserve System.
421
RECORD OF POLICY ACTIONS OF THE
FEDERAL OPEN MARKET
COMMITTEE
At its meeting on March 28-29, 1983, all of
the members of the Committee found acceptable a policy calling for maintaining
generally the current degree of reserve restraint, pending the availability of further
evidence on the behavior of the monetary
aggregates and on the economic situation.
The members anticipated that such a policy
course would be consistent with substantial
slowing in the growth of M2 and M3 to
annual rates of about 9 percent and 8 percent respectively over the period from
March to June. The Committee expected
that Ml growth at an annual rate of about 6
to 7 percent over the three-month period
would be associated with its objectives for
the broader aggregates.
The Committee members agreed that
lesser restraint on reserve positions would
be acceptable in the context of more pronounced slowing of growth in the monetary
aggregates, relative to the paths implied by
the long-term ranges (taking account of the
distortions relating to the introduction of
new deposit accounts), or indications of a
weakening in the pace of the economic
recovery. It was understood that the intermeeting range for the federal funds rate,
which provides a mechanism for initiating
consultation of the Committee, would be
retained at 6 to 10 percent.
429 LEGAL
DEVELOPMENTS
A 7 0 BOARD
R e v i s i o n o f Regulation T; various bank
holding c o m p a n y and bank merger orders;
and pending c a s e s .
Al FINANCIAL
AND BUSINESS
STATISTICS
A 3 D o m e s t i c Financial Statistics
A 4 6 D o m e s t i c Nonfinancial Statistics
A 5 4 International Statistics
A 6 9 GUIDE TO TABULAR
PRESENTATION,
STATISTICAL RELEASES, AND
SPECIAL
TABLES
OF GOVERNORS
A 7 2 FEDERAL OPEN MARKET
AND STAFF. ADVISORY
A 7 3 FEDERAL RESERVE
AND OFFICES
ALA FEDERAL RESERVE
PUBLICATIONS
A 7 9 INDEX
STAFF
COMMITTEE
COUNCILS
BANKS,
BRANCHES,
BOARD
TO STATISTICAL
A 8 l MAP OF FEDERAL
AND
TABLES
RESERVE
SYSTEM
Developments in Consumer k
Electronic Fund Transfers
Frederick J. Schroeder of the Board's Division of
Research and Statistics prepared this article.
Ever since the telegraph and telephone came into
public use, commercial participants in the nation's payment system have been able to use
electronic communication to facilitate the transfer of funds among themselves. In the public
sector, the Federal Reserve System has been
actively involved in electronic fund transfers
since 1918, when the first Morse code wire
transfer network was established for the movement of funds among reserve accounts of member banks at Federal Reserve Banks.
Only recently, however, have individual consumers been able to order convenient and inexpensive electronic payments to and from their
accounts at financial institutions. Rapid improvements in electronic data processing and the development of low-cost, high-speed telecommunications have made possible the widespread use
of electronic fund transfer (EFT) by consumers.
In many transactions, EFT can now largely
displace other methods of payment, such as
cash, checks, and credit cards. Nonetheless, at
this time consumer EFTs still collectively account for only a small portion—less than 1 percent—of all payments in the retail economy.
With the technology of payments poised for
further advances and with major changes coming
in the structure of the financial services industry
as new competitors enter and new rules take
effect, further displacement of traditional paperbased payment methods by EFT is likely. All
evidence points to continuing rapid growth in the
volume of consumer EFTs.
This article describes the extent to whicl
consumers use EFT, reviews the rationale foi
public regulation of EFT, and presents new
evidence on the costs and benefits associated
with the efforts financial institutions make to
achieve compliance with consumer EFT regulation.
CONSUMER
USE OF
EFT
The extent to which electronic fund transfer
spreads depends primarily on three elements.
The first—and the precondition—is the automation of operations by financial institutions. The
second is the extent to which institutions make
EFT services available to consumers by providing accessible systems and promoting their use.
The third is the willingness of consumers to
accept the new means of payment. This factor
will ultimately determine the growth of the electronic payments system.
Consumers have, in fact, quickly taken to
EFTs* and the use of them is likely to grow
dramatically, for two reasons (see the inset). The
first lies in the price of EFTs relative to alternative means of payment, particularly checks. The
cost to the banking system of operating the
check-clearing mechanism was estimated to be
about $0.50 per check in 1979. According to a
1981 Treasury-sponsored study of bank handling
of social security payments, checks deposited by
mail had an average incremental processing cost
of $0.59, while preauthorized direct deposits by
EFT had an average incremental processing cost
of $0.07. Preauthorized electronic deposits and
debits are the most automatic type of EFT and
therefore the least costly to process; the costs of
other types of EFT are greater and may vary
widely, depending on the size and efficiency of
the transfer systems involved. As institutions
move toward pricing checking services to reflect
costs, however, and as average EFT costs fall
with the expansion of EFT volume, electronic
transactions will become more competitive with
checks.
396
Federal Reserve Bulletin • June 1983
Developments in consumer use of electronic fund transfers
Consumer use of EFTs has grown vigorously over the past
few years, as demonstrated by the following evidence:
• A Board-sponsored survey conducted in April 1983
found that of the households with a checking, savings,
NOW, or share draft account, more than 68 percent had an
account with an EFT feature and used it at least occasionally. In March 1981 the proportion was 54 percent.
• A recent survey of automation by commercial banks
confirms the trend toward expansion of EFT services.
Many small banks offer EFT services, and nearly all banks
engage in computerized operations, a necessary condition
for the spread of EFT.'
• The number of automated teller machines (ATMs) in
use has grown rapidly. At the end of 1982, financial
institutions were operating an estimated 36,000 ATMs, 38
percent more than at the end of 1981. The average annual
volume of transactions, excluding inquiries about balances,
rose 32 percent to 86,000 transactions per machine. Total
volume increased 74 percent to an annual rate of 3.1 billion
transactions at the end of 1982.2
• The number of financial institutions offering ATM
access increased dramatically during 1981. According to a
recent survey, 29 percent of the nation's 14,400 commercial banks were offering ATM services in 1982, up from 19
percent a year earlier; and 14 percent planned to offer ATM
services. Of banks offering such services, more than half
were engaged in some form of ATM sharing with other
institutions.3
• Telephone bill-payment services were offered by more
than 450 financial institutions in 1982, compared with 403
institutions in 1981. These providers accounted for about
one-fifth of the assets of all depository institutions in the
nation. Telephone bill payments grew approximately 20
percent in 1982 to an annual rate of 72 million transactions.4
• The volume of transactions through automated clearinghouses (ACHs) continued to grow substantially during
the past year. Of the more than 49 million payments of
federal salaries and benefits in December 1982, nearly 18
million, or 36 percent, were made by EFT.5 Another 16
million electronic payments were originated each month
last year by about 20,000 private organizations. Total ACH
volume reached an annual rate of 408 million electronic
transactions, an increase of 30 percent over the year.6
• Surveys indicate that 71 percent of all households now
have at least one account at a financial institution that
offers ATM access, and that at least one person in 32
percent of all households used an ATM in November
1982.7
• Point-of-sale EFT and home banking systems are
developing at an increasingly rapid pace. Of commercial
banks with total deposits exceeding $500 million, 13 percent supported some form of EFT at point of sale, and 14
percent more planned to support such a system. Of banks
with deposits between $100 million and $500 million, 3
percent supported and 10 percent planned to support pointof-sale EFT.8 Experiments with home banking systems are
spreading: in 1980, 2 institutions operated pilot projects; by
1982, 80 institutions had pilots.9 About 25 systems are
expected to be in full operation by 1986.
1. National Operations!Automation
Survey 1981 (Washington,
D.C.: American Bankers Association, 1981).
2. Linda Fenner Zimmer, "ATMs: In the Wake of the Network
Scramble," Magazine of Bank Administration, vol. 59 (May 1983),
pp. 26-30.
3. 1982 Retail Deposit Services Report (Washington, D.C.: American Bankers Association, 1982).
1
4. " I s Pay-By-Phone Reaching a Flashpoint?" Bank Network
News, vol. 1, November 23, 1982.
5. Direct Deposit Volume Report (U.S. Department of the Treasury, December 1982).
6. NACHA SurePay Update (Washington, D.C.: National Automated Clearing House Association, December 1982).
7. ATM Appeal and Usage—One-Year Update (Atlanta, Georgia:
The Unidex Reports, November 1982).
8. Richard R. Dart, Point of Sale: Current Status, Trends, and the
Task Force Approach (Cambridge, Maryland: Trans Data Corporation, 1982).
9. Robert W. Price, "Videotex/Home Banking: Current Status and
Trends," TransDatagram (Cambridge, Maryland: Trans Data Corporation, October 30, 1982).
Many consumers prefer convenience and selfservice in retail transactions generally because of
the price or quality advantages. The success of
supermarkets, self-service gasoline stations, and
direct-dial telephone systems amply demonstrates that preference. In many of their dealings
with financial institutions, too, consumers prefer
convenience and the opportunity to serve themselves. Those EFT services that have satisfied
these preferences have been swiftly adopted by
consumers. The most successful automated teller machine programs have offered around-theclock access to funds through highly reliable
terminals in convenient locations. Similarly, direct deposit programs have offered consumers
greater reliability and more convenient, more
immediate access to funds than alternative
means of deposit. Bill payments can be ordered
by telephone in any amount at any time of the
day through the computerized systems offered
by most providers, and the consumer can specify
the date on which each transfer is to be made by
his or her institution. As more merchants accept
EFTs as a means of payment at point of sale
(POS), consumers are likely to make heavy use
of them there as well. Complete documentation
Developments
of transfers for recordkeeping and proof of payment is yet another convenience that attracts
consumers to EFT.
Automated teller machines (ATMs) are currently the most prominent of the five principal
forms of consumer EFT (the others are telephone bill payment, home banking, point-of-sale
payments, and transfers through automated
clearinghouses). Despite their popularity, ATMs
have limited usefulness because they are not
designed for use at the point of sale, the site of
most retail transactions. Moreover, they cannot
in most circumstances handle payments to and
from third parties. Nevertheless, ATMs are a
significant step in the long-run development of
EFT systems. First, they have already familiarized people with debit cards and remote elec >nic terminals, providing experience that can be
applied in point-of-sale transactions and home
banking. Second, ATM networks will proliferate
and form a national system of telecommunication
links and interconnected message switches capable of handling large volumes of POS and homebanking transactions.
REGULATION OF CONSUMER EFT
The Electronic Fund Transfer Act, which became law in November 1978, introduced a new
factor into the development of consumer EFT
services. Broad in its coverage of financial institutions and technically exacting in its requirements, the act had as its primary purpose the
establishment of consumer rights and protections. Although it provided certain protections
for financial institutions involved in EFT, the act
principally imposed regulatory duties and liabilities on institutions. Before its implementation,
no one knew how costly compliance with the act
would be for individual institutions or the industry as a whole. Similarly, no one knew the extent
of the benefits the act would engender.
The Congress gave the Federal Reserve Board
the responsibility for writing regulations to implement the Electronic Fund Transfer Act. The
Board also was given the responsibility for administering and enforcing the act for state member banks. In Regulation E, the Board sets out
the rules for issuance of EFT access devices,
in Consumer Electronic Fund Transfers
397
liability limits for losses from unauthorized transfers, disclosures to account holders, documentation of transfers, notice of preauthorized credits,
error-resolution procedures, and other matters,
Among the Board's statutory obligations is a
requirement that it analyze the act's economic
effects, particularly the costs and benefits of the
act to consumers and to other users of EFT
systems. To improve the quality of the analysis,
in 1981 and 1982 the Board's staff conducted a
survey of financial institutions to determine their
costs of complying with Regulation E and their
perceptions of its benefits,
From the Board's perspective, an understanding of the economic and institutional effects of
Regulation E is important, for a number of
reasons. First, the Board requires information on
compliance efforts to ensure that the consumer
protections established in the act are implemented. Second, the Board seeks to ensure that its
regulations are not unduly burdensome or complex. Third, recent laws, in particular the Financial Regulation Simplification Act of 1980 and the
Regulatory Flexibility Act of 1980, require that
the Board review all its regulations in order to
minimize compliance costs and eliminate unnecessary burdens that compliance imposes on small
businesses. Fourth, a regulation that affects so
fast-growing a sector of the payment system as
consumer EFT must be monitored to determine
its effect on growth and efficiency in the payment
mechanism. Finally, because it is relatively new,
Regulation E can serve as a paradigm for the
study of the costs of compliance associated with
similar new regulations and thereby provide insight into the economic effects of the regulatory
process.
To meet these informational needs the Board
undertook a survey of a sample of financial
institutions to assess their costs of and benefits
from complying with Regulation E. The design
and findings of that survey are summarized in the
following sections. The newness of the regulation and of compliance efforts enhanced the
chances for meaningful results from the survey,
Financial institutions were expected to have better, more complete information on the costs of
complying with Regulation E than on the costs
associated with older, more established regulations, to which the institutions had adjusted long
ago.
398
Federal Reserve Bulletin • June 1983
Survey
Design
Survey questions were formulated to collect information on incremental compliance costs, or
costs above and beyond what would have been
incurred in the absence of Regulation E. Respondents were asked to classify their incremental
compliance costs into start-up and ongoing expenses using the following functional categories:
administration, training, legal services, labor,
changes in data processing systems, postage,
telephone statements, disclosures, and premises
and equipment. In addition, each respondent was
asked which EFT services it offered, its annual
total volume of EFT transactions, and its perceptions regarding the benefits and costs of Regulation E. Participation in the survey was wholly
voluntary. General announcements of the survey
and calls for participants were published in the
F E D E R A L R E S E R V E B U L L E T I N and the Federal
Register. The 67 institutions that subsequently
supplied complete responses to the survey questionnaire were located in 33 states and the District of Columbia; they represented a wide variety of sizes, geographic regions, state branching
laws, and bank holding company affiliations.
Characteristics
of
Respondents
The total domestic deposits of survey respondents ranged from less than $25 million to more
than $25 billion. The classes used to aggregate
and report the data were chosen using two criteria: (1) the classes should group respondents that
could be expected to be roughly similar in such
size-related aspects as operating methods, organizational type, access to capital, scope of markets, and attainable level of automation; and (2)
the classes should divide the respondents into
groups of approximately equal number to facilitate statistical cross-class comparisons. The
same size classes are used throughout this report
so that comparisons can be made across tables.
Of particular importance for the analysis of
compliance costs is information on the types of
EFT services an institution offers. Compliance
with Regulation E may be achieved at varying
levels of expense and effort, depending on the
level and complexity of EFT services an institution offers. Table 1 shows the number and percentage of respondents that offered each of the
major EFT services covered by Regulation E.
Several characteristics of the survey respondents are evident in table 1. First, all but one of
the institutions offered direct deposit programs
and therefore became subject to the regulation's
basic provisions, which specify error-resolution
procedures and periodic statement documentation, among other things. Second, three-fourths
of all respondents also offered automated teller
machines or cash dispensers, thereby becoming
subject to additional regulatory provisions, such
as those governing liability exposure, the issuance of terminal access devices (mainly debit
cards), and the dispensing of terminal receipts.
Third, some institutions provided more complicated forms of EFT, including telephone bill
payment, point-of-sale debit cards, or automatic
payment features; because they usually involve
on-line telecommunications or special use of the
automated clearinghouse network, these services may have required additional efforts to
comply with Regulation E and, consequently,
additional compliance costs.
Table 1 also shows that the smaller institutions
tended to offer fewer EFT services than the
larger institutions, although that observation
1. Percentage of survey respondents offering EFT services, by size of deposits
Deposits (millions of dollars)
EFT service
Automated teller machine or cash dispenser
Telephone bill payment
Automatic payment features
Check authorization or guarantee
Point-of-sale debit card
Direct deposit program
Other
MEMO: Number of respondents in size class
Less than 100
100-500
500-1,000
1,000-3,000
3,000 or more
46
9
54
18
18
100
0
11
47
7
80
7
7
100
0
15
93
14
57
14
14
93
14
14
92
31
77
23
31
100
8
13
93
29
86
21
14
100
0
14
All
respondents
75
18
72
16
16
98
4
67
Developments
does not hold for every kind of service. Taken
together, smaller institutions did, in fact, offer
every type of EFT service, and they were not
seriously underrepresented in any type. Almost
half of the smaller respondents offered ATMs, an
EFT service offered by virtually all respondents
with more than $500 million in deposits. With the
proliferation of ATM networks, smaller institutions are likely to find it increasingly easy to offer
ATMs to their customers. It is apparent that their
size does not preclude some small institutions
from offering EFT services. Differences between
institutions in services offered may become less
pronounced as sharing and franchising relationships develop and as the cost of providing services falls.
Although the survey respondents represent a
broad range of institutional sizes and types,
generalizations from their experiences about the
compliance costs likely for other institutions
should be cautiously made. The survey was a
voluntary one, and it was not based on randomsampling techniques. Respondents may have
been more likely to have active compliance programs than most institutions at the time of the
survey. Moreover, the costs of setting up a
compliance program and complying with the
regulation may have changed since the survey. If
interpreted with these cautions in mind, the
survey findings nevertheless may be considered
indicative of the compliance costs other institutions experience.
Costs
of
Compliance
The survey was designed to determine start-up
and ongoing compliance costs separately because expenditure patterns were presumed to be
substantially different for the two kinds of cost.
Start-up expenses were thought to be analogous
to fixed costs, and ongoing expenses were
thought to be analogous to variable costs in the
classic cost model.
Table 2 shows the average start-up and ongoing costs that were reported by respondents in
each size class. It also shows the percentage of
total compliance costs incurred for each kind of
cost for each size class. Several conclusions may
be drawn. First, the ratio of total start-up costs to
in Consumer Electronic Fund Transfers
399
total ongoing costs tended to rise with the size of
the institution, a pattern that might develop
because larger institutions have a more complicated organizational structure to prepare for
compliance or invest more heavily in preparations for compliance in hopes of selling such
services to their correspondents. Second, smaller institutions devoted, on average, larger shares
of their expenditures on compliance to legal,
administrative, and training costs than larger
institutions did, possibly because the smaller
ones had to assign a larger proportion of their
managers to compliance activities or had to hire
outside consultants. Third, for the aggregate of
all respondents, the change in data processing
systems was the most expensive start-up function; and labor, probably for preparation of the
extra periodic statements and for error resolution, was the most costly ongoing function.
Although the relationship does not hold for all
comparisons between size classes, larger financial institutions seem to enjoy lower compliance
costs per EFT transaction (table 3), as they do
per million dollars of total deposits (table 4). A
possible inference from these data is that some
financial institutions suffer from a cost disadvantage in compliance merely because they are
small: they must incur the same costs as larger
institutions do in setting up and maintaining their
compliance programs, which thus claim a larger
proportion of their resources. The recent increased availability of shared EFT networks,
EFT services packaged for resale, and assistance
in complying with Regulation E from a variety of
vendors may mitigate such disadvantages.
• Regulatory relief may also help offset the cost
disadvantages that smaller institutions face in
complying with Regulation E. For example, the
Federal Reserve Board recently amended Regulation E to provide relief to small institutions: for
the 26,000 depository institutions with assets of
$25 million or less, all preauthorized electronic
transfers to and from any consumer account are
fully exempt from the regulation.
While the total cost of compliance per EFT
transaction, shown in the last line of table 3, may
appear to be high relative to the cost of an EFT
transaction, it is probably not high enough to
compromise the cost advantage EFT transactions may otherwise have over check-based
400
Federal Reserve Bulletin • June 1983
transactions. In the long run, additional EFT
transactions can probably be made at little incremental cost either for the payment system or for
compliance. Consequently, as EFT systems mature and are more heavily utilized, the average
compliance cost per transaction will fall. The
larger survey respondents were likely to have
2.
more heavily utilized systems and, therefore,
lower costs per transaction.
A rigorous statistical analysis of the survey
findings about the effects on compliance cost of
bank size, transaction volume, and level of EFT
services offered will be presented in a forthcoming Board staff study.
Average costs per institution for compliance with Regulation E, by cost category and size of deposits of
survey respondents
Deposits (millions of dollars)
Cost category
Less than 100
Dollar
amount
Percent
of total
100-500
Dollar
amount
500-1,000
Percent
of total
Dollar
amount
1.000-3,000
Percent
of total
Dollar
amount
3,000 or more
All respondents
Percent
of total
Dollar
amount
Percent
of total
Dollar
amount
Percent
of total
Start-up costs
Administration
Training
Legal services
Changes in data
processing systems
Premises, furniture,
supplies, equipment
Statement forms and
disclosure documents
Other
2,333
1,102
684
38
18
11
3,361
2,421
3,255
18
13
17
18,808
6,010
17,248
22
7
20
17,275
10,521
15,035
11
7
10
75,663
28,374
23,960
20
8
6
24,228
9,949
12,369
18
8
9
572
9
7,257
38
37,846
44
83,082
53
173,681
47
62,039
47
450
7
687
4
464
0
9,047
6
5,804
2
3,293
2
634
432
10
7
1,698
417
9
2
3,769
949
4
1
15,187
6,745
10
4
50,835
14,387
14
4
14,841
4,677
11
4
Total
6,207
100
19,096
100
85,094
100
156,892
100
372,704
100
131,396
100
Ongoing costs
Administration
Labor
Training
Legal services
Printing or purchase
of statements
Postage
Premises, furniture,
supplies, equipment
Telephone
Other
Total
2,992
6,351
446
168
23
50
4
1
7,143
7.370
1,077
1,017
33
34
5
5
42,995
39,197
4,332
1,676
41
37
4
2
4,107
15,787
2,366
1,550
6
24
4
2
23,282
80,310
12,786
9,891
10
36
6
4
16,946
31,186
4,416
3,014
19
35
5
3
1,306
753
10
6
951
1,427
4
6
3,134
13,145
3
12
22,662
17,633
35
27
16,747
40,281
8
18
9,112
15,282
10
17
393
122
264
3
1
2
1,520
909
526
7
4
2
144
485
0
0
0
0
0
385
1,095
0
1
2
21,418
468
18,702
10
0
8
4,983
492
4,356
6
0
5
12,795
100
21,940
100
105,108
100
65,585
100
223,885
100
89,787
100
Total costs through first year of compliance
Administration
Training
Labor
Legal services
Changes in data
processing systems
Printing or purchase
of statements
Postage
Premises, furniture,
supplies, equipment
Statement forms and
disclosure documents
Telephone
Other
Total
5,325
1,548
6,351
852
28
8
33
4
10,504
3,498
7,370
4,272
26
9
18
10
61,803
10,342
39,197
18,924
32
5
21
10
21,382
12,887
15,787
16,585
10
6
7
7
98,945
41,160
80,310
33,851
17
7
13
6
41,174
14,365
31,186
15,383
19
6
14
7
572
3
7,257
18
37,846
20
83,082
37
173,681
29
62,039
28
1,306
753
7
4
951
1,427
2
3
3,134
13,145
2
7
22,662
17,633
10
8
16,747
40,281
3
7
9,112
15,282
4
7
843
4
2,207
5
608
0
9,047
4
27,222
4
8,276
4
634
122
3
1
1,698
909
943
4
2
3,769
485
949
2
0
15,187
385
7,840
7
0
50,835
468
33,089
9
0
0
14,841
492
9,033
7
0
41,036
100
190,202
100
222,477
100
596,589
100
221,183
100
6%
19,002
100
Developments
in Consumer Electronic Fund Transfers
401
3. Average costs per E F T transaction for compliance with Regulation E, by cost category and size of deposits
of survey respondents
Cents
Deposits (millions of dollars)
Less than 100
100-500
500-1,000
1,000-3,000
3,000 or more
All
respondents
1.2
.5
.4
2.9
.1
.8
.2
6.1
1.4
.6
.7
3.6
.2
.9
.3
7.7
.4
1.2
.2
.2
.3
.6
.3
0
.3
3.5
.9
1.6
.2
.2
.5
.8
.3
0
.2
4.7
1.6
.7
1.2
.6
2.9
.3
.6
.4
.8
.0
.5
9.6
2.3
.8
1.6
.9
3.6
.5
.8
.5
.9
.0
.5
12.4
Start-up costs
Administration
Training
Legal services
Changes in data processing systems
Premises, furniture, supplies, equipment
Statement forms and disclosure documents . . .
Other
Total
4.3
2.1
1.3
1.1
.8
1.2
.8
11.6
1.6
1.2
1.6
3.5
.3
.8
.2
9.2
2.4
.8
2.2
4.8
.1
.5
.1
10.9
1.4
.8
1.2
6.6
.7
1.2
.5
12.4
Ongoing costs
Administration
Labor
Training
Legal services
Printing or purchase of statements
Postage
Premises, furniture, supplies, equipment
Telephone
Other
Total
.
|
...
. .
.. •
Administration
Training
Labor
Legal services
Changes in data processing systems
Printing or purchase of statements
Postage
Premises, furniture, supplies, equipment
Statement forms and disclosure documents
Telephone
Other
Total
Benefits
of
5.1
10.7
.8
.3
2.2
1.3
.7
.2
.4
21.7
5.1
4.7
.5
.2
.4
1.6
0
.1
0
12.6
.3
1.2
.2
.1
1.7
1.3
0
0
.1
4.9
Total costs through first year of compliance
3®
9.4
2.9
10.7
1.6
1.1
2.2
1.3
1.5
1.2
.2
1.2
33.3
Compliance
The survey of financial institutions also included
questions regarding the benefits of Regulation E
to consumers, financial institutions, and the payment system. Answers to those questions were
necessarily subjective and nonquantifiable. Virtually all financial institutions that responded to
the questions about benefits stated that no operating costs had been reduced or eliminated as a
side benefit of compliance efforts. Some mentioned that consumers and the payment system
in general would benefit from the standardization
of error-resolution procedures, uniform limits on
liability, and consumers' increased awareness of
EFT issues, rights, and responsibilities.
Evidence on consumer benefits is available
from two other sources. One is the Board's Consumer Complaint Control System, which in 1982
3.0
3.0
.4
.4
.4
.6
.6
.4
.2
9.0
4.6
1.6
3.0
2.0
3.5
.4
.6
.9
.8
.4
.4
18.2
7.5
1.3
4.7
2.4
4.8
.4
1.6
.1
.5
.1
.1
23.5
1.7
1.0
1.2
1.3
6.6
1.7
1.3
.7
1.2
.0
.6
17.3
received only 75 complaints regarding EFT; 37
concerned banks not supervised by the Board
and were referred to other supervisory agencies.
Of the 38 complaints concerning banks supervised by the Board, only 3 involved a bank
violation; the rest involved no bank error, a
clerical error, or a factual dispute, or were in the
process of being resolved. Measured against the
3 billion EFT transactions a year at ATMs alone,
the number of official complaints is minute. It
suggests that only few errors or problems occur
and that financial institutions are able to resolve
them.
Another source of evidence on consumer
benefits is a pair of Board-sponsored consumer
surveys based on random samples, one conducted in March 1981 and the other in April 1983
(table 5). The 1983 survey found that about 6
percent of households holding a transaction ac-
402
Federal Reserve Bulletin • June 1983
4. Average costs per million dollars of total deposits for compliance with Regulation E, by cost category and
size of deposits of survey respondents
Dollars
Deposits (millions of dollars)
3,000 or more
All
respondents
8.92
3.35
2.83
20.48
.68
5.99
1.70
43.95
10.35
4.25
5.28
26.49
1.41
6.34
2.00
56.12
2.55
8.79
1.40
1.08
1.83
4.41
2.35
.05
2.05
24.51
6.59
12.13
1.72
1.17
3.54
5.94
1.94
.19
1.69
34.91
Cost category
Less than 100
100-500
500-1,000
1,000-3,000
Start-up costs
Administration
Training
Legal services
Changes in data processing systems
Premises, furniture, supplies, equipment
Statement forms and disclosure documents . . .
Other
Total
51.14
24.16
15.00
12.54
9.87
13.90
9.47
136.08
15.03
10.82
14.55
32.44
3.07
7.59
1.86
85.36
26.19
8.37
24.02
52.70
.65
5.25
1.32
118.50
9.26
5.64
8.06
44.53
4.85
8.14
3.62
84.10
Ongoing costs
Administration
Labor
Training
Legal services
Printing or purchase of statements
Postage
Premises, furniture, supplies, equipment
Telephone
Other
Total
59.64
126.59
8.88
3.35
26.03
15.00
7.82
2.43
5.26
255.00
27.68
28.55
4.17
3.94
3.68
5.53
5.89
3.52
2.04
85.00
55.59
50.68
5.60
2.17
4.05
17.00
.19
.63
0
135.91
2.03
7.81
1.17
.77
11.21
8.72
0
.19
.54
32.44
Total costs through first year of compliance
Administration
Training
Labor
Legal services
Changes in data processing systems
Printing or purchase of statements
Postage
Premises, furniture, supplies, equipment
Statement forms and disclosure documents . . .
Telephone
Other
Total
110.78
33.04
126.59
18.35
12.54
26.03
15.00
17.69
13.90
2.43
14.73
391.08
count with an EFT feature alleged that the institution had made an error in the past year because
of the feature. Most of these alleged errors
appeared to involve misunderstandings, mechanical malfunctions of ATMs, or accounting mistakes, rather than errors in the actual transfer of
funds. Of those who complained to the institution about an alleged error, virtually all reported
being satisfied with the way in which the institution resolved the complaint.
In the 1983 survey, fewer than 1 percent of
households with an account subject to EFT
alleged an unauthorized withdrawal in the past
year because of that feature. Furthermore, none
of those households lost any money in the end.
Given the frequency of electronic transfers in the
payment system, the number of EFT errors as
defined in Regulation E seems to be negligible.
Moreover, some of the alleged errors were not
actually related to EFT.
42.71
14.99
28.55
18.49
32.44
3.68
5.53
8.96
7.59
3.52
3.90
170.36
81.78
13.97
50.68
26.19
52.70
4.05
17.00
.84
5.25
.63
1.32
254.41
11.29
6.81
7.81
8.83
44.53
11.21
8.72
4.85
8.14
.19
4.16
116.54
11.47
4.75
8.79
3.91
20.48
1.83
4.41
3.03
5.99
.05
3.75
68.46
16.94
5.97
12.13
6.45
26.49
3.54
5.94
3.35
6.34
.19
3.69
91.03
A primary benefit intended by the act is the
information conveyed to consumers by the disclosures that institutions must regularly send
out. The 1983 survey revealed that 53 percent of
households with an EFT account feature were
aware of receiving notices of error-resolution
procedures from the financial institution (up
from 45 percent in 1981). Only 10 percent of
those households were aware of a federal law or
regulation concerning EFT-related errors, despite having received the required notices regularly (down from 14 percent in 1981). Fewer than
12 percent of the households with an EFT feature
in their account had heard of any federal legislation or regulation limiting the amount of money a
consumer could lose through an unauthorized
electronic transfer. Although these findings suggest that consumers have little awareness of
rules and regulations about EFTs, this apparent
failure may in fact demonstrate that EFT sys-
Developments
5.
in Consumer Electronic Fund Transfers
403
Survey of consumer EFT accounts
Item
Households interviewed
Had any checking, savings, NOW, or share draft accounts
Account had at least one E F l feature and that feature was used
at least occasionally
Alleged an error by a financial institution in the past year because of an EFT feature 2
Complained to the institution about the error
Were satisfied with the institution's resolution of the error
Were aware of receiving error-resolution procedure notice
from the institution
Were aware of a federal law or regulation concerning EFTrelated errors
Alleged unauthorized withdrawal from an account because of
an EFT feature 3
Ultimately lost money because of the alleged withdrawal
Were aware of any federal law or regulation that limits the
amount of money that a consumer would lose from an
unauthorized withdrawal because of an EFT feature
Number
Percent
of total
Base for
percentage 1
707
635
93.2
435
68.5
635
26
21
20
6.0
84.0
95.2
435
25
21
232
53.3
435
43
9.9
435
3
0
.7
0
435
3
51
11.7
435
(581
1. For some responses the base for calculating percentages is
smaller than the number interviewed because some respondents did
not reply to those questions.
2. In some cases responses indicate that the error was actually
made by the consumer or that the problem was a misunderstanding
rather than an error by the institution.
3. In some cases responses indicate a misunderstanding or a
withdrawal by another family member rather than a fraudulent withdrawal.
SOURCE. The survey was conducted for the Federal Reserve Board
in April 1983 by the University of Michigan Survey Research Center.
A national random sample of 707 households was interviewed by
telephone; 681 usable responses were obtained. Because of sampling
error normally encountered in a survey of this type and size, the
sample response rates are likely to be within 2 percentage points of the
underlying rates for the population 95 percent of the time.
terns have been working well, so that consumers
do not feel they need to read or understand the
disclosures. Moreover, many of the provisions in
the regulation, such as limitations on liability for
unauthorized transfers, provide benefits regardless of whether consumers are aware of them.
celerating. That acceleration shows no signs of
abating. As institutions comply with EFT regulation, their costs will reflect their initial efforts to
set up compliance programs as well as their
ongoing expenses to maintain them. As EFT
systems mature, as transaction volume builds,
and as start-up costs for compliance are amortized, compliance costs for each EFT transaction
are likely to fall. With regard to consumer rights
in EFT, there appear to be few problems, and
available evidence indicates that the number of
account errors and unauthorized transfers is negligible both in absolute terms and relative to the
volume of EFT transactions occurring in the
payment system.
•
CONCLUSION
Regulation of consumer EFT began at a time
when the number of financial institutions offering
EFT services, the number of consumers demanding those services, and the volume of consumer electronic transactions were steadily ac-
404
Treasury and Federal Reserve Foreign
Exchange Operations: Interim Report
This interim report, covering the period February through April 1983, is the twenty-first of a
series providing information on Treasury and
System foreign exchange operations to supplement the regular series of semiannual reports
that are usually issued each March and September. It was prepared by Sam Y. Cross, Manager
of Foreign Operations of the System Open Market Account and Executive Vice President in
charge of the Foreign Group of the Federal
Reserve Bank of New York.
During the February-April period under review,
the decline in global economic activity appeared
to have ended, but questions remained about the
breadth and scope of recovery and the prospects
for a resumption in growth of world trade. Demand for oil remained weak and oil prices softened to the point of challenging the ability of the
Organization of Petroleum Exporting Countries
to set production quotas and price differentials
and thereby effectively to limit price declines.
Meanwhile, persistent concern about the divergence of economic performances within Europe
generated a major speculative attack against the
exchange rate relationships within the European
Monetary System (EMS). This speculation
prompted the heaviest central bank intervention
in support of the EMS rate structure in the fouryear history of the EMS before the rates were
realigned on March 21.
As the exchange markets reacted to the crosscurrents of these developments, the dollar generally held steady against most currencies. On
balance, between the end of January and the end
of April the dollar was little changed against the
German mark and narrowly mixed vis-a-vis other
currencies. Although trading below its highs of
late 1982 against the major foreign currencies,
the dollar remained well above its lows reached
immediately preceding the reporting period in
January 1983. This firm performance was contrary to the forecasts of the many experts and
market observers who were anticipating a significant further easing of the dollar through early
1983.
The dollar's firmer-than-expected tone first
emerged in response to definite signs that recession in the United States was giving way to a
significant recovery. However, for a period after
mid-February, those initial signs of a strong
industrial upturn were superseded by later indications that the expansion was likely to be more
moderately paced, confined largely to increased
activity in a few sectors of the economy and to a
turnaround in inventory investment. Thus, some
skepticism reappeared that the recovery would
prove durable in the face of continued high real
interest rates.
Nevertheless, the economic outlook remained
more promising for the United States than for
most other industrialized countries. Moreover,
shortly after the President's State of the Union
and budget messages, the administration's economic advisers were suggesting that the projections for growth of real output for 1983, then
estimated at 1.4 percent, should be revised
strongly upward. By comparison, European officials forecast little or no growth in continental
economies, and Japan's forecast growth rate of
3.4 percent for fiscal 1983-84 looked modest
compared with that country's presumed potential.
The dollar was sustained in the market as a
number of concerns subsided that had weighed
against the currency during the late fall and early
winter. In particular, the fear that economic
recovery would necessarily be accompanied by a
rekindling of inflation tended to dissipate as
prospects for substantial gains in productivity
improved. Market observers also became less
concerned about cost pressures from basic mate-
405
rials, as expectations grew of a substantial reduction of world oil prices. The U.S. trade account
turned out to be in smaller deficit during the first
quarter than had generally been expected, and
the deficit even narrowed somewhat from that
recorded in the last three months of 1982. This
result reflected a sharp drop in the oil import bill,
which was expected to be largely temporary and
was associated with reduced demand in response
to the relatively warm winter and the liquidation
of inventories in anticipation of lower prices
later. Market forecasts of a large U.S. current
account deficit for the year as a whole were not
significantly revised. Nevertheless, the temporary respite from monthly releases of large deficit
figures seemed to defuse what had previously
been an important negative factor for the dollar,
so that considerations of relative trade and current account performances received little attention in the exchange markets during the period
under review.
The exchange markets were also influenced at
times by shifting assessments of the prospects
for dollar interest rates. During February the
improving scenario for inflation, together with
the prospect for only a moderate recovery, gave
a lift to U.S. credit markets, and long-term
interest rates began to turn down. In this environment, market operators considered the possibility that the Federal Reserve would not resist a
decline in short-term interest rates and might
lower its discount rate, both to lend support to
the recovery at home and to help foster an
international economic climate in which heavily
indebted countries might be better able to meet
the objectives of their stabilization programs. In
fact, short-term rates held steady through April,
and the Federal Reserve kept its discount rate at
the level of 8V2 percent established in December.
But long-term rates did continue to ease, moving
down in two stages—first during February and
again in April. It appears that, as long-term rates
eased, substantial amounts of funds were moved
into the United States by investors hoping to
realize further capital gains. At the same time,
real interest rates remained relatively high, and
foreign investment was attracted also by the
bullish U.S. stock market, continuing safe-haven
considerations, and the apparently better growth
prospects in the United States than abroad.
In addition, the dollar frequently became
caught up in developments primarily involving
European currencies, particularly the events surrounding the realignment on March 21 of parities
in the EMS. From early February, sentiment
became increasingly favorable toward the German mark, which strengthened against other
European currencies as well as the dollar, as
market participants speculated first about the
outcome of upcoming national elections in Germany and then about the likelihood that a longanticipated realignment of EMS parities would
take place shortly thereafter. Speculative buying
of German marks and Dutch guilders, both considered virtually certain to be revalued in any
restructuring of the EMS, intensified while the
weaker currencies in the European joint float,
including particularly the French and Belgian
francs, came on offer.
The French franc, after having been maintained around the middle of the EMS band for
some weeks, was allowed to drop to its mandatory lower intervention point after March 6, and,
subsequently, Euro-French franc interest rates
soared to unprecedented levels. The Belgian
authorities, also faced with intensifying pressures, imposed stringent new foreign exchange
controls. With speculation against these two
currencies becoming prohibitively expensive,
positioning in favor of the stronger EMS currencies increasingly took the form of sales of nonEMS currencies, including the dollar. At the
same time, official intervention to defend the
EMS parities, while primarily conducted in European currencies, also involved substantial
sales of dollars by the central banks whose
currencies were weak within the system. EMSrelated sales by both private and official parties
thus contributed to a tendency of the dollar to
decline moderately during the first three weeks
of March, particularly against the German mark.
The reversal of these flows after the March 21
realignment similarly contributed to the dollar's
subsequent recovery.
By April, as the new quarter opened and many
of the reflows into dollars associated with the
recent EMS realignment were completed, exchange market activity settled down to a subdued pace, and the dollar traded in a relatively
narrow range. Some uncertainty was generated
406
Federal Reserve Bulletin • June 1983
Drawings and repayments 1
1.
Millions of dollars; drawings, or repayments
Outstanding,
Jan. 1, 1982
Bank, or drawings
1982: 1
1982: 2
1982: 3
1982: 4
1983: 1
1983
April
Outstanding,
April 30, 1,983
Foreign central banks and the Bank for International Settlements under regular reciprocal
currency arrangements
Bank drawing on Federal Reserve
System
Bank of Mexico
0
Bank for International Settlements 2 (against
German marks)
0
0
0
J 800.01
[-600.0]
11,400.01
1-900.0}
-217.4
0
} 124.01
(-124.0}
0
-482.6
0
0
0
0
0
Bank of Mexico under special swap arrangements
Drawings on
U.S. Treasury special temporary facility for
$1,000 million
Special combined credit facility
Federal Reserve special facility for
$325 million
f 825.01
[-825.0J
U.S. Treasury special facility for $600 million
f 89.81
I " 43.8}
211.2
67.8
325.0
[
392.2
122.3
600.0
603.5
190.00
166.8
[ - 81.3
[1,081.61
Total.
1 —950.01
0
925.0
Central Bank of Brazil under special swap arrangements with the U.S. Treasury
Drawings on U.S. Treasury special facilities
for
$500 million
$280 million
$450 million
$250 million
$200 million
$200 million
Total
1. Data are on a value-date basis. Because of rounding, details may
not add to totals.
by the persistent divergence between the dollar's
apparent firmness and the still widely held view
that the medium-term trend of the dollar would
be downward because of the outlook for interest
rates and current accounts. Adding to the uncertainty were concerns that trade protectionist
pressures might be deepening in response to two
years of declining world growth. In this context,
talk spread among market participants that the
major industrial countries might be preparing a
coordinated intervention effort—now that the
intervention study commissioned at last year's
summit meeting had been completed and on
speculation that exchange rates would be a major
point of discussion at the Williamsburg summit.
By late April, however, expectations of substantial changes in official intervention policy faded,
and on April 29 the intervention study was
500.01
-500.0}
280.0
450.0
250.01
-104.2}
-
280.0
450.0
- 145.8
]
200.0]
1 - 200.01
}
200.0]
\ - 200.0J
400.0
l,480.0j {
-604.2J I—1,275.8J
2. BIS drawings and repayments of dollars against European currencies other than Swiss francs to meet temporary cash requirements.
released by the summit ministers, accompanied
by a statement on intervention and related matters. But, in the cautious atmosphere that had
prevailed during much of April, market professionals were prepared to sell dollars, thereby
stemming any marked upward movement of the
dollar, while commercial participants often were
substantial buyers when the dollar eased. As a
result, the dollar market was well balanced.
There was a marked change of the dollar only
against the pound sterling, which, in an environment of stabilizing oil prices, recovered nearly 7
percent from an earlier decline.
By the close of the period the dollar traded at
DM 2.4615 in terms of the German mark and
¥ 237.80 against the yen, some Vi percent and
1 percent respectively below the levels of three
months earlier. Against the pound sterling, the
Foreign Exchange Operations
407
U . S . Treasury securities, foreign commitments, currency denominated1
2.
Millions of dollars equivalent; issues, or redemptions (—)
Issues
Amount of
commitments,
Jan. 1, 1982
1982: 1
1982: 2
1982: 3
1982: 4
1983: 1
1983,
April
Amount of
commitments,
April 30, 1983
Public series
Germany . . .
Switzerland
3,622.3
458.5
0
0
-451.0
0
-1,231.9
0
-664.1
0
0
-458.5
0
0
1,275.2
0
Total
4,080.8
0
-451.0
-1,231.9
-664.1
-458.5
0
1,275.2
1. Data are on a value-date basis. Because of rounding, details may
not add to totals.
dollar ended the period down nearly 3 percent as
compared with three months earlier, while it
increased 2 percent against the Swiss franc. In
terms of a trade-weighted average, the dollar
rose about 1 percent to close the period only
slightly below the historically high levels it had
reached in November 1982. The U.S. authorities
did not intervene in the exchange markets during
the period under review.
In other operations during the three-month
period, the U.S. monetary authorities continued
to provide credits to Mexico and Brazil. At the
4same time, both countries made repayments on
earlier bridging credits provided by the U.S.
monetary authorities as they drew on other financing arrangements.
As discussed in the previous report, both the
Federal Reserve and the U.S. Treasury's Exchange Stabilization Fund had provided credits
to Mexico during 1982-83. Funding was provided
through the Bank of Mexicos' regular swap facility of $700 million with the Federal Reserve, and
also through special swap facilities in cooperation with other central banks through the Bank
for International Settlements. In February, Mexico drew the remaining portion of the special
facility, receiving $44.25 million from the Treasury and $25.75 million from the Federal Reserve. As of April 30, drawings of $325 million
and $600 million were outstanding from the Federal Reserve and the Treasury respectively, representing the entire $925 million available under
the U.S. portion of the multilateral swap facility.
On February 28, the Bank of Mexico fully repaid
the remaining $373 million outstanding on its
swap line under the Federal Reserve's regular
reciprocal currency arrangement, which had
been drawn last August before other arrangements had been put in place. Thus, on balance,
during this three-month period, Mexico reduced
its net outstanding borrowing from the Federal
Reserve and the Treasury under these facilities
by $303.0 million.
On February 1 the Central Bank of Brazil
repaid $280 million of the $730 million outstanding on facilities made available to it earlier by the
Treasury. The remaining $450 million facility
was repaid on March 3. On February 28, the
Treasury agreed to provide Brazil with two additional swap facilities of $200 million each in
anticipation of Brazil's drawings under the compensatory financing facility and the extended
Fund facility of the International Monetary
Fund. These swaps were drawn on February 28
and March 3 and were repaid by March 11. Thus,
at that point Brazil had repaid in full all Treasury
swaps that had been made available to it since
October 1982,
In April, the Bank for International Settlements, acting with the support of the U.S. Treasury and the monetary authorities in other countries, agreed to participate in an international
financial support package for Yugoslavia. The
Treasury, through the Exchange Stabilization
Fund, as part of the liquidity-support arrangement for the BIS provided by the participating
monetary authorities agreed to substitute for the
BIS for $75 million in the unlikely event of
delayed repayment by Yugoslavia.
In the period from February through April, the
Federal Reserve and the Treasury realized no
profits or losses from exchange transactions. As
of April 30, cumulative bookeeping or valuation
losses on outstanding foreign currency balances
were $578.1 million for the Federal Reserve and
$951.3 million for the Treasury Exchange Stabilization Fund, while the Treasury general account
showed valuation gains of $360.9 million related
408
3.
Federal Reserve Bulletin • June 1983
N e t Profits and l o s s e s ( - ) o n U . S . Treasury and
Federal Reserve current foreign exchange
operations1
Millions of dollars
United States Treasury
Period
February 1 through
April 30, 1983
Valuation profits and
losses on outstanding
assets and liabilities
as of April 30, 1983 ..
Federal
Reserve
Exchange
Stabilization
Fund
General
account
0
0
0
-578.1
-951.3
360.9
1. Data are on a value-date basis.
to outstanding issues of securities denominated
in foreign currencies. These valuation gains and
losses represent the decrease in the dollar value
of outstanding currency assets and liabilities
valued at end-of-period exchange rates, compared with the rates prevailing at the time the
foreign currencies were acquired.
The Federal Reserve and the Treasury have
invested foreign currency balances they had acquired in the market as a result of their foreign
exchange operations in a variety of investments
that yield market-related rates of return and have
a high degree of quality and liquidity. Under the
authority provided by the Monetary Control Act
of 1980, the Federal Reserve had invested some
of its own foreign currency resources and those
held under warehousing agreements with the
Treasury in securities issued by foreign governments. As of April 30, the Federal Reserve's
holdings of such securities were equivalent to
$1,509 million. In addition, the Treasury directly
held the equivalent of $2,589 million in these
securities as of the end of April.
•
409
Industrial Production
Released for publication
June 15
Industrial production increased an estimated 1.1
percent in May, with gains widespread among
materials and products. Large advances occurred in the output of automotive products,
business equipment, and construction supplies.
Since the low in November 1982, total industrial
output has increased 7 percent—about the aver-
1977
1979
1981
1983
age gain for six months after a cyclical low. At
144.3 percent of the 1967 average, the index for
May was about 6 percent below the prerecession
high in mid-1981.
In market groupings, output of durable consumer goods continued to advance strongly in
May, while output of nondurable goods increased slightly. Autos were assembled at an
annual rate of 6.2 million units compared with a
1977
1979
1981
All series are seasonally adjusted and are plotted on a ratio scale. Auto sales and stocks include imports. Latest figures: May.
1983
410
Federal Reserve Bulletin • June 1983
1967 = 100
Percentage change from preceding month
1983
1983
Grouping
Apr.p
Maye
Jan.
Feb.
Mar.
Apr.
May
Percentage
change,
May 1982
to May
1983
Major market groupings
Total industrial production
142.7
144.3
1.6
.5
1.3
2.0
1.1
3.7
Products, total
Final products
Consumer goods
Durable
Nondurable
Business equipment .
Defense and space ..
Intermediate products .
Construction supplies
Materials
144.3
142.6
146.8
139.1
149.9
147.2
119.4
150.7
137.0
140.1
146.0
144.3
148.1
142.4
150.4
149.7
120.9
152.6
139.6
141.5
.7
.4
1.1
4.5
-.1
-1.0
.4
1.6
3.3
3.3
-.4
-.9
-.1
2.1
-.9
-2.7
-.3
1.1
2.1
2.2
1.0
.8
.8
1.2
.5
.8
.9
1.8
3.1
1.7
1.8
1.9
1.6
2.3
1.4
2.3
2.0
1.9
2.5
2.1
1.2
1.2
.9
2.4
.3
1.7
1.3
1.3
1.9
1.0
2.6
1.5
3.1
7.4
1.7
-6.4
12.3
7.0
14.2
5.4
2.1
2.3
1.9
-.5
1.1
1.3
1.5
.9
1.1
-.1
5.1
4.0
6.5
-12.3
-2.1
Major industry groupings
143.2
129.1
163.6
111.9
167.5
Manufacturing
Durable
Nondurable
Mining
Utilities
p Preliminary.
e Estimated.
145.0
131.1
165.1
113.1
167.3
1.1
1.1
1.0
-5.2
-.7
1.5
1.9
1.0
-2.7
2.3
NOTE. Indexes are seasonally adjusted.
5.9 rate in April, and current industry schedules
suggest a sizable further increase for June. The
output of lightweight trucks for consumer use
was also up sharply in May. Production of home
goods, which had surged in both March and
April, advanced further in May at a somewhat
slower pace.
Output of business equipment increased 1.7
percent in May. Output of building and mining
equipment rose sharply, as oil and gas well
drilling activity increased and a strike at an
equipment producer was resolved in late April.
Production of manufacturing, commercial, and
transit equipment also was up further in May.
Output of construction supplies continued to
advance rapidly, and the gain has averaged about
1.6
2.2
1.2
3.0
-.7
2.5 percent per month since last December.
Materials output increased 1.0 percent in May,
reflecting gains in durable and nondurable materials and a small decline in energy materials. The
strong pace of advance in the production of
durable materials during the preceding four
months lessened somewhat to an increase of 1.4
percent in May. Among nondurable materials,
production of chemicals, paper, and textiles
showed sizable increases.
In industry groupings, output of manufacturing
increased 1.3 percent in May, reflecting gains of
1.5 percent in durable manufacturing and 0.9
percent in nondurable manufacturing. Mining
activity turned upward, but output by utilities
edged down.
411
Statement to Congress
Statement by Preston Martin, Vice Chairman,
Board of Governors of the Federal Reserve System, before the Subcommittee
on Domestic
Monetary Policy of the Committee on Banking,
Finance and Urban Affairs, U.S. House of Representatives, June 1, 1983.
I am pleased to have this opportunity to discuss
the current employment situation, which, quite
rightly, is a matter of great concern both to the
members of this committee and to the Federal
Reserve. As you are well aware, the nation's
unemployment rate reached a postwar high during the recent recession; and although labor
demand is now strengthening, one-tenth of our
labor force was still unemployed when the most
recent labor market surveys were conducted in
mid-April. Similar problems of high unemployment characterize our trading partners because
of a long period of slow growth in the world
economy.
This recent period of high unemployment has
disrupted the lives of millions of willing workers
and their families. Many persons who had held
jobs have lost them in the wake of declining
economic activity. Others, seeking jobs for the
first time, have been unable to find them, and
have instead fallen into the ranks of the unemployed. Still others, discouraged by poor labor
market conditions, have dropped out of the labor
force altogether.
Obviously, an employment situation like this
creates extensive strains within our society. We
can point with considerable pride to our success
in reducing inflation over the last two years.
However, that gain would represent only a partial success if it were to leave a large part of our
work force outside the mainstream of economic
life for extended periods. Therefore, we at the
Federal Reserve share this committee's interest
in exploring the dimensions of the current employment situation and in seeking ways in which
it might be constructively addressed. In my
remarks today I will focus on the broad dimen
sions of the economic situation, particularly as
they affect labor markets, and will indicate what,
in my view, the Federal Reserve can do—and
cannot do—to help establish a climate for sustainable improvement in economic activity and
employment. My colleague, Mr. Silas Keehn,
President of the Federal Reserve Bank of Chicago, will then focus on the particular employment
problems of several of the states within his
Reserve Bank's District.
At the present time our economy is emerging
from a most trying and difficult period. Throughout the 1970s we were afflicted by an increasingly
virulent inflation that, by the end of the decade,
was threatening to undermine our economy in
rather fundamental ways. The underlying inflation rate had accelerated to the double-digit level
and seemed likely to go higher. Price speculation
was spreading into the decisionmaking processes
of both businesses and consumers, and the dollar
had weakened considerably in foreign exchange
markets. An even more troubling development
was the high inflation that was coming to be
viewed as a permanent feature of our economy;
more and more, inflation was being built into the
structure of interest rates, and rising inflationary
expectations were exerting an increasingly
strong hold on the behavior of savers and investors alike.
This gradual worsening of inflation, and the
application of restrictive policies necessary to
bring inflation under control, eventually culminated in a prolonged period of economic stagnation. On balance, from mid-1979 to late 1982,
there was little change in real output, and our
economy fell substantially beneath its potential
to produce. In labor markets the total number of
unemployed workers rose 5V2 million from late
1979 to the end of 1982, and the unemployment
rate reached a maximum of 10.8 percent, about 5
percentage points above the lowest point
reached during the economic expansion of the
late 1970s.
The long period of economic stagnation and
412
Federal Reserve Bulletin • June 1983
rising unemployment affected most industries,
regions, occupations, and demographic groups.
The most serious impact, however, was felt by
the cyclically sensitive construction and durable
goods manufacturing industries, many of which
already were facing difficult transitions because
of heightened competition from foreign producers. In some key sectors—including steel, autos,
and lumber—operating rates fell to extremely
low levels, and economic hardships became
widespread in the communities that were dependent on these industries. Unemployment rose
especially rapidly among adult men, who hold a
disproportionate number of jobs in the durable
goods producing industries. Among blacks and
teenagers, unemployment rose further from rates
that already were far above the national average.
As the period of economic recession became
more prolonged, the number of long-term unemployed rose to an exceptionally high level.
At the same time, despite a discouraging labor
market situation overall, there continued to be
signs of underlying employment stability in several sectors—and even a few pockets of vitality—as the rapid growth of new industries led to
expanding job opportunities. For example, the
service sector of the economy continued to grow
throughout the recession and now employs IV2
million more people than it did at the beginning
of 1980. Over that period, the use of computers
in our economy increased rapidly, and the number of workers providing computer and data
processing services, though still a small share of
total employment, has risen by more than a
fourth in the past three years.
Because inflation had become so deeply embedded in our economy, prices kept rising rapidly in 1980 and 1981, even as the economy was
falling into recession. Inflation in 1980 remained
near the double-digit level, and in 1981 the slowing of prices was mainly confined to a few
sectors of the economy.
In 1982, however, the application of policies to
combat inflation began to bear substantial fruit.
The slowing of price advances became more
widespread and potentially more lasting, as all
major price indexes advanced at considerably
slower rates than in 1981. For some price measures, the increases in 1982 were the smallest in
more than a decade, and price developments
have continued to be favorable into early 1983.
It is true that part of that slowdown in inflation
reflected the influence of special developments
in agricultural and energy markets. However,
there have also been strong indications of more
fundamental gains, as the wage-price interactions that had helped perpetuate inflation
through the 1970s began losing momentum.
Many businesses have been adapting their pricing policies to the realities of a more competitive
and less inflationary economy. Work rules are
changing as firms strive to bolster productivity
and trim costs. At the same time, workers are
agreeing to smaller pay increases than in earlier
years; but, happily, with inflation falling so rapidly, the slowing of nominal wage increases
generally has been consistent with gains in real
purchasing power. A slower rate of increase in
labor costs is relieving pressures on prices, and
in turn a slowing of prices is damping inflationary
expectations and relieving workers' fears of falling behind in an inflationary spiral.
For the time being, at least, this cumulative
process of disinflation appears to be continuing.
Wage adjustments so far this year have been
holding at a reduced pace similar to that of late
1982, and recent price developments have been
exceptionally encouraging. The consumer price
index rose at an annual rate of about 2 percent
over the first four months of this year, and the
producer price index actually fell at an annual
rate of nearly 4 percent during that same period.
Although these price data were influenced in part
by declining oil prices early in the year, they also
indicate a continued easing in underlying inflationary trends.
Curbing the momentum of inflation is now
beginning to have the salutary effects on real
activity that had long been anticipated. The
halving of inflation rates during 1982, as well as a
number of other factors, contributed to substantial declines in interest rates over the second half
of last year. As a result, activity in housing began
to improve last summer; gains in consumer
spending started to appear last fall; and in recent
months a number of other broad economic indicators have been pointing to a strengthening
economy. Barometers of consumer attitudes and
business sentiment have strongly improved, and
increases in production and sales are now apparent in a wide range of industries.
The upturn in economic activity has, in turn,
Statement
led to some firming of labor market conditions.
The rate of layoffs began slackening in late 1982,
and the unemployment rate has started to come
down from its peak level. Total payroll employment has increased about 650,000 since the end
of last year, with more than one-third of those
gains occurring in the manufacturing sector, in
which employment had previously declined
steadily for a year and a half. So far, the gains
have been about average for the early stages of a
recovery.
The price and employment developments
since the beginning of the year have been broadly
in line with the economic expectations held by
members of the Federal Open Market Committee
and included in our February monetary policy
report to the Congress. The general thrust of
those projections, you may recall, was that activity and employment were expected to expand at
a moderate rate this year and that the pace of the
recovery would be consistent with further progress toward price stability. With the recovery
apparently gaining momentum in recent months,
I believe that there is an excellent chance that
this year's economic performance will be at least
as good as was projected in mid-February.
At the same time, a number of potential obstacles to sustained economic growth were apparent
when the monetary policy report was prepared,
and despite the favorable economic developments of the past few months, those obstacles
still confront us today. Foremost among these is
the prospect that federal budget deficits will
persist at very substantial levels in the years
ahead, even as the economy moves well into an
expansion. The federal deficit in the current
fiscal year is expected to exceed 6 percent of
gross national product, and unless constructive
action is taken, this share will remain extremely
large in the years ahead. In part because of these
prospective megadeficits, intermediate- and
long-term interest rates remain high relative both
to their historical levels and to current inflation
rates, and financial markets remain unsettled,
reflecting concerns that the deficits will keep
pressures on interest rates and eventually lead to
a renewed surge of price inflation.
Concern about a budget-induced resurgence of
inflation is symptomatic of a more widespread
and still-persistent fear that inflation has been
brought under control only temporarily and that
to Congress
413
it will escalate again once a new expansion has
gained momentum. To a considerable extent,
that fear arises from more than a decade of failed
efforts to reduce inflation for more than brief
periods; and because such expectations of inflation are still very much in evidence, we must be
especially prudent in designing monetary policy
in the period ahead. In particular, focusing monetary policy solely on the need for rapid growth
and ignoring the still-present threat of inflation
would risk surrendering the gains that we have
made against inflation at such a high social cost.
To be sure, the task of controlling inflation and
restoring growth should not be viewed as the
responsibility of monetary policy alone. Fiscal
policy, too, must do its part. I am well aware that
the Congress and the administration are sensitive
to the dangers of the looming budget deficits; but
at the same time the events of recent weeks
illustrate the great difficulties of reaching a consensus on how best to reduce these deficits.
While mindful of these difficulties, I would
strongly urge you to continue seeking positive
solutions that mitigate the dangers associated
with persistent, huge structural deficits.
Other obstacles to an economic recovery reflect current difficulties in the world economy,
into which we have become increasingly integrated in the past decade. Poor economic conditions in foreign nations, as well as a strong dollar,
have limited U.S. exports in the past two years
and have contributed importantly to the loss of
jobs in several of our basic industries. This
external drag on our economy, if it were to
continue, would be an impediment to renewed
expansion in the U.S. economy. Perhaps an even
more serious development is that the prolonged
period of slow growth worldwide has exacerbated debt-servicing problems in the developing
nations and is causing a rise in protectionist
sentiment in the industrial nations. The dangers
inherent in this world economic situation are
substantial; but they are not insurmountable, and
I remain hopeful that we can deal with them
successfully through the cooperative efforts of
private and public institutions.
So long as we make progress toward solving
these difficulties, both at home and in the international arena, the most likely outcome for our
economy will be that of expanding activity and
declining unemployment. Those gains, of course,
414
Federal Reserve Bulletin • June 1983
may not be steady from month to month and will
not show up evenly in all sectors. Indeed, because of the stresses and uncertainties spawned
by many years of high inflation and slow growth,
many businesses will likely be hesitant to expand
investment and employment until there are more
convincing signs that the recovery will prove
lasting. Unemployment, therefore, will probably
still be at a high level at the end of this year.
What matters most, though, is not the pace of
the recovery in its first few months, but whether
we can achieve a broad-based and sustained
expansion; and it is to that end that our current
policies must be directed. Monetary and fiscal
policies must necessarily share responsibility for
the long-run state of the economy, but at the
same time we should be fully aware of the
particular ways in which monetary policy can
influence the economy and of the ways in which
its influence is limited.
Economic analysis shows rather convincingly,
I believe, that monetary policy can be a contributing factor determining the rate of growth in
nominal income, but that there is no certainty
that a particular monetary policy will have the
intended effect on real economic activity and
employment, particularly in the long run. One of
the lessons learned in the past decade is that
there is no reliable trade-off between inflation
and unemployment; and because the dangers of
inflation were neglected far too long, the process
of moving back toward a more stable price
environment has become lengthy and costly.
We would all agree, I think, that what we want
ultimately for our citizens is an environment of
rising real incomes and expanding job opportunities. I am convinced that the best way the
Federal Reserve can help achieve that end is by
working to establish the kind of noninflationary
economic expansion that can be sustained for a
long period. Given an economy in which there is
confidence of continued price stability, a steady
rise in employment and in living standards is
likely to follow.
There remain, Mr. Chairman, the difficult
questions of the extent to which the present
recovery might reduce unemployment and, conversely, the extent to which "structural," as well
as "frictional," unemployment would still persist even when the economy has returned to its
long-run noninflationary growth path.
The concept of structural unemployment is
obviously a useful one in that it seeks to identify
that portion of total unemployment that is less
related to the normal workings of the business
cycle and for which special programs that seek to
attain a better match between workers and jobs
might prove effective.
Structural unemployment has long been a
problem among certain groups—teenagers, for
example—who often lack the training needed in a
rapidly changing labor force. But it also arises as
patterns of labor demand shift in association with
such factors as changing population patterns,
technological advances, and the increased competitiveness in international markets. Typically,
these structural changes occur gradually, with
diminished employment in some regions and
industries being offset by an expansion of job
opportunities in other areas. Because it takes
time for dislocated workers to obtain new training, to relocate, or to revise their wage expectations, the spells of unemployment for these
workers tend to be particularly long.
In practice, unfortunately, there has never
been a clear-cut analytical or statistical distinction between structural unemployment and cyclical unemployment, and attempting to apply the
distinction is especially difficult in the current
period. It may well be, for instance, that structural change has occurred at an unusually rapid
pace in recent years, and that some industries
will continue to fall well short of their previous
peak levels of activity, even with a healthy and
sustained economic recovery. Presumably, some
of the workers displaced from those industries
will discover new employment opportunities in
sectors that are expanding, such as the hightechnology industries. But such employment
shifts take time, and there is legitimate concern
about whether the new industries can absorb
expeditiously the workers dislocated from declining industries, especially given differences in
geographic location and required job skills.
Our historical experience suggests that a portion of today's unemployment problem—probably a sizable portion—can best be alleviated
through macroeconomic policies designed to encourage a sustainable recovery in activity, and
some of the problems that now appear structural
may disappear as activity recovers. Nevertheless, it appears that a significant unemployment
Statement
problem is likely to persist even in a steadily
expanding economy. In the late 1970s, for instance, the unemployment rate dipped only
slightly below the 6 percent mark, even after four
years of economic expansion, and at present it
does not seem likely that the rate will drop back
to that level any time soon. Indeed, the difficulties of reducing unemployment in the period
ahead may be exacerbated by the deep-seated,
and perhaps irreversible, changes that are affecting many of our primary industries.
Unfortunately, monetary and fiscal policies
are ill-equipped to deal with the special problems
of structural unemployment. However, over
time a number of programs have evolved to
address the difficulties of the structurally unemployed. The approaches taken have included
training and educational programs, relocation
assistance, and special job-creating policies. We
are still learning whether some of these approaches, when carefully crafted to encompass
the cooperative actions of business, labor, and
government, can contribute to an easing of the
unemployment problems that confront us. A
particular challenge for the period ahead will be
to adapt these approaches so as to best aid those
workers displaced by the rapid changes now
occurring in our industrial sector.
to Congress
415
In conclusion, Mr. Chairman, monetary policy
best serves by continuing to be focused on
fostering a lasting expansion in business activity
within the framework of continued progress
against inflation. At the same time we recognize
fully our responsibilities in promoting safety and
soundness in the financial markets and in supporting a strengthening of the international financial system. This nation has experienced the
difficult adjustment process of restructuring for a
productive, less inflationary economy after a
decade of low productivity and destructive inflationary pressures. The human and economic
costs of this disinflation process have been high.
We cannot step back now from our commitments
and thus jeopardize the gains that we have garnered to date. The health and sustainability of
the economic recovery depend, of course, not
only on monetary policy, but also on fiscal
policy, in particular on whether policymakers
can reduce the dangers of massive out-year budget deficits. With a responsible fiscal policy to
complement the monetary policies now in place,
I am confident that the recovery can prove a
durable one, associated with rising living standards and increased employment.
•
416
Announcements
NOMINATIONS
FOR APPOINTMENTS
CONSUMER ADVISORY
COUNCIL
TO
The Federal Reserve Board has announced that
it is seeking nominations of qualified individuals
for eight appointments to its Consumer Advisory
Council to replace members whose terms expire
on December 31, 1983.
Nominations should be submitted in writing to
Dolores S. Smith, Assistant Director, Division of
Consumer and Community Affairs, Board of
Governors of the Federal Reserve System,
Washington, D.C. 20551, and must be received
no later than August 5, 1983. Nominations
should include the name, address, and telephone
number of the nominee; past and present positions held; and special knowledge, interests, and
experience related to consumer financial matters.
The Consumer Advisory Council was established by the Congress in 1976, at the suggestion
of the Board, to advise the Board on the exercise
of its duties under the Consumer Credit Protection Act and on other consumer-related matters.
The Council meets three times a year.
REGULATION
K:
AMENDMENTS
The Federal Reserve Board issued on June 2,
1983, regulations implementing the Bank Export
Services Act (BESA) authorizing investments in
export trading companies. The BESA is part of
the Export Trading Company Act of 1982.
Investment in export trading companies may
be made by bank holding companies directly, or
indirectly through an Edge or Agreement corporation subsidiary, but not through a bank.
The regulations, which are amendments to
Regulation K (International Banking Operations), are limited in scope and are primarily
designed to clarify ambiguities in the law and to
provide key definitions and basic guidance to
investors as to the policies and procedures the
Board will follow in carrying out its responsibilities under the act. The regulations also incorporate an exemption from the collateral requirements of section 23 A of the Federal Reserve Act
for certain transactions between a bank and an
affiliated export trading company to finance
trade in goods by the export trading company.
Consistent with the purposes and objectives of
the BESA, the regulations define an export trading company as one that is exclusively engaged
in activities related to international trade and that
derives more than half its revenues from the
export of, or facilitiating the export of, goods or
services produced in the United States by persons other than the export trading company or its
subsidiaries. If the revenues test is not met over
a two-year period, the company will be expected
to provide an explanation and adopt and implement a plan to meet the requirement. The regulation defined revenues as including net sales revenues from trading of goods by the company and
gross revenues from all other activities of the
company. Under these regulations, an export
trading company in which a banking organization
invests can engage in a broad range of services,
including but not limited to consulting, marketing, warehousing, freight forwarding, certain
types of insurance activities, and taking title to
goods, when these activities serve to facilitate
trade in goods and services produced by others.
The BESA, in providing for Federal Reserve
review of investments in export trading companies by eligible banking organizations, establishes expedited procedures requiring 60 days'
prior written notice to the Board of an investment in an export trading company. If the Board
does not disapprove the investment within this
time (which the Board may extend 30 days if it
needs additional information), the investment
may be made.
The regulations provide for a further notification when the export trading company expands
Announcements
into new activities that would alter the fundamental character of the company's operation.
Under the regulations, companies filing notifications of investment will follow the checklist of
information used for Regulation K notifications
of proposed investments.
Notification procedures will not differ for investments in joint venture export trading companies. The regulations prohibit lending to a partner in a joint venture on terms more favorable
than terms available to others. This applies to
partners with at least 10 percent interest in the
joint venture export trading company.
The Board also determined that, after more
experience is gained with export trading companies and within at least one year, it will consider
whether a general consent procedure should be
provided for certain investments in export trading companies.
The Board may disapprove proposed investments to prevent unsafe or unsound banking
practices, undue concentration of resources, decreased or unfair competition or conflicts of
interest, material adverse effects on bank subsidiaries of bank holding companies, or failure to
file accurate or material information.
Notifications must include information as to
the leveraging characteristics of the export trading company. The Board stated that capital adequacy is a critical determinant of the financial
strength of an export trading company and its
ability to withstand unexpected adverse developments so as not to affect the financial resources
of the parent organization or the safety or soundness of affiliated banks. Accordingly, the Board
will consider the capital adequacy of an export
trading company as an important factor to be
taken into account in determining whether to
disapprove a proposed bank holding company
investment. After further experience with these
companies, the Board will also consider whether
to establish capital adequacy guidelines for export trading companies.
The Board noted that bank holding company
investment in export trading companies also
raises the need to review the adequacy of the
capital of the parent organization. When a bank
holding company seeks to expand its activities
and operations through an export trading company, the Board will, in evaluating the pro
417
posed investment, also address the capital adequacy of the holding company.
REGULATION
T:
REVISION
The Federal Reserve Board has adopted a completely revised and simplified version of Regulation T (Credit by Brokers and Dealers).
The revision of Regulation T, one of the
Board's four regulations concerning margin requirements, is part of the Board's Regulatory
Improvement Program. Under this program, the
Board is reviewing all of its regulations to update
them, simplify their language, eliminate obsolete
or unneeded language or provisions, and to lighten the burden of compliance. The revised regulation has been shortened approximately a third.
In 1982, the Board adopted several major
substantive changes to Regulation T and published for comment a proposal to completely
revise the regulation. The final regulation, as
adopted after consideration of comment received, includes the following significant
changes:
• Conformation of Regulation T to take cognizance of new instruments—options on foreign
currency that are traded on securities exchanges
and options on certificates of deposit and on
stock indexes—that came within the Board's
authority to set margins as a result of recent
legislation.
• Setting the margin level of these instruments
as the amount specified by the rules of the
national securities exchange on which the option
is traded, provided that all such rules have been
approved by the Securities and Exchange Commission.
• Authorizing margin credit on over-thecounter (OTC) corporate debt securities, with at
least $25 million outstanding at the time of original issue rather than at the time of the extension
of the credit.
• Permission to use convertible or exchangeable securities as a proxy for the related security
when call options are written in a cash account.
• Provisions that permit a clearing agency to
accept as the required deposit any margin securities underlying options issued by the clearing
agency.
418
Federal Reserve Bulletin • June 1983
• Revision of rules for extending credit to
option specialists, to permit a "good faith" margin instead of the 25 percent margin on long and
short positions in stocks underlying the option.
• Expansion of the class of brokers and dealers
who may make loans to other brokers and dealers, as well as authorization for them to finance
positions with other brokers and dealers.
• Authorization for a clearing broker to maintain separate margin accounts for a single person
who is introduced by different brokers. Introducing brokers may maintain separate accounts for
the same person if the accounts are cleared by
different clearing brokers. In addition, separate
accounts may also be established for the same
person by a broker or dealer when the broker or
dealer or a third-party investment advisor has
investment discretion.
• Consolidation along functional lines of the 11
types of accounts currently required to be maintained by brokers and dealers into 7 types of
accounts.
• Changes in terminology, throughout the regulation, from "maximum loan value/adjusted
debit balance" to the use of "equity/margin
requirements."
The new regulation will go into effect on
November 21, 1983. However, creditors may
begin to operate under its terms, at their option,
as early as June 20, 1983.
The Board's revised Regulation T is available,
upon request, from the Federal Reserve Banks.
REVISED
LIST OF OTC
STOCKS
The Federal Reserve Board has published a
revised list of over-the-counter (OTC) stocks
that are subject to its margin regulations, effective June 20, 1983.
The list supersedes the revised list of OTC
margin stocks that was issued July 26, 1982, and
the amendments to that list effective on October
18, 1982, and February 22, 1983. Changes that
have been made in the list, which now includes
1,649 OTC stocks, are the following: 96 stocks
have been included for the first time; 19 stocks
previously on the list have been removed for
substantially failing to meet the requirements for
continued listing; and 24 stocks have been re
moved for reasons such as listing on a national
securities exchange or acquisition of the companies by another firm.
The Board monitors the market activity of all
OTC stocks to determine which stocks meet the
requirements for inclusion and continued inclusion on the list of OTC margin stocks and periodically revises the list.
Margin regulations generally limit the amount
of credit a person or firm may obtain to buy, or
carry, securities. Stocks on the list of OTC
margin stocks are subject to the same margin
requirements (currently 50 percent) as stocks
listed on national stock exchanges. These requirements mean that a person or firm buying a
stock on credit must make a down payment equal
to at least 50 percent of the purchase price of the
stock and may obtain credit for the remaining 50
percent.
Margin requirements on OTC stocks apply
only to credit extended on the date the stock
becomes an OTC margin stock and thereafter.
Credit extended by banks to purchase or carry
OTC stocks before they appeared on the list
becomes subject on that date to the retention and
withdrawal requirements of the Board's Regulation U (Credit by Banks for the Purpose of
Purchasing or Carrying Margin Stocks) if the
credit is collateralized by any margin stock. Such
credit previously extended by lenders subject to
Regulation G (Securities Credit by Persons Other
Than Banks, Brokers, or Dealers) becomes subject to retention and withdrawal requirements if
collateralized by "margin securities."
It is unlawful for any person to cause any
representation to be made that inclusion of a
security on this list indicates that the Board or
the Securities and Exchange Commission has in
any way approved such security or any transaction therein. Any references to the Board in
connection with the list or any securities thereon
in any advertisement or similar communication is
unlawful. The list is published by the Board for
the information of lenders and the general public.
PROPOSED
ACTIONS
The Federal Reserve Board has proposed for
public comment revisions of its rules regarding
Announcements
loans by state member banks to certain insiders,
to implement recent legislative changes. Comments must be received by June 20, 1983.
The Board also proposed for public comment a
complete overhaul and updating of the Board's
Regulation Y (Bank Holding Companies and
Change in Bank Control). The Board requested
comments by July 18, 1983.
419
SYSTEM
MEMBERSHIP:
ADMISSION OF STATE
BANKS
The following banks were admitted to membership in the Federal Reserve System during the
period May 11, 1983, through June 10, 1983:
Colorado
Eagle
Alpine Bank
Rangely
Rio Blanco State Bank
Ohio
Columbus
Independent State Bank
of Ohio
421
Record of Policy Actions of the
Federal Open Market Committee
MEETING
HELD
1. Domestic
ON MARCH
Policy
28-29,
1983
Directive
Based on partial information available for the
first quarter, it appeared that real GNP rose
moderately in the first three months of the year,
following a decline at an annual rate of about 1
percent in the fourth quarter of 1982. The turnaround in economic activity reflected a considerable slowing in the pace of inventory liquidation.
Meanwhile, private final sales in real terms,
which had risen in the fourth quarter, continued
to increase. The rise in average prices, as measured by the fixed-weight price index for gross
domestic business product, slowed further.
Final sales were sustained by a marked
strengthening in housing activity in early 1983.
Private housing starts rose to an average annual
rate of 1.7 million units in January and February,
up nearly 40 percent from the pace in the fourth
quarter. Newly issued permits for residential
construction also rose substantially over the twomonth period. Sales of new homes increased in
January, the latest month for which data were
available; although sales of existing homes
dipped in February, they were appreciably higher in the first two months combined than in the
fourth quarter.
Other elements of final sales were not quite so
strong on balance as in the fourth quarter of last
year. Personal consumption expenditures continued to expand in early 1983, but at a slower rate
than in the previous quarter. The nominal value
of retail sales fell in January and February,
primarily reflecting declines in sales at automotive outlets, gasoline stations, and furniture and
appliance stores, although sales at general merchandise and apparel stores rose appreciably
from their level in the fourth quarter. Sales of
new domestic automobiles continued at an annu
al rate of about 6.1 million units, the same as in
the fourth quarter.
Spending for business fixed investment has
remained weak in recent months. Shipments of
nondefense capital goods fell sharply in January
and edged down further in February, and new
orders dropped appreciably in February after
firming for several months. Outlays for nonresidential construction increased in January, but
high vacancy rates for office buildings and the
reduced drilling activity associated with declining oil prices apparently have damped such expenditures recently. The Department of Commerce survey taken in late January and February
indicated that in 1983 business outlays for plant
and equipment would decline about PA percent
in nominal terms, about the same as in 1982.
Nonfarm payroll employment rose about
150,000 on balance over January and February,
after an extended period of declines. The monthto-month employment figures, which showed a
substantial rise in January and a decline in February, were distorted by unusual weather patterns. But employment in manufacturing—particularly in the auto and related metals
industries—increased in both months. The civilian unemployment rate was unchanged in February at 10.4 percent. Industrial production has
risen at an annual rate of about 7 VA percent since
its trough in November, less than the average
pace in the early stages of previous cyclical
recoveries.
The producer price index for finished goods
fell nearly 1 percent over the first two months of
the year, reflecting sharp declines in prices of
energy-related items. The consumer price index
was virtually unchanged over the period, as a
substantial drop in prices of gasoline and other
petroleum products was about offset by moderate increases in prices of most other commodities
and services. Food prices have changed little
422
Federal Reserve Bulletin • June 1983
thus far in 1983 and in February were only 2
percent above their level a year earlier.
The advance in the index of average hourly
earnings has slowed further in recent months.
With productivity apparently continuing to improve in early 1983, cost pressures in the nonfarm business sector have abated further.
In foreign exchange markets the trade-weighted value of the dollar had risen about 2 percent
on balance since the Committee's meeting in
February. The U.S. merchandise trade deficit
declined marginally in January. Exports rose
somewhat and total imports continued at about
the fourth-quarter rate, as oil imports dropped
sharply while non-oil imports strengthened.
At its meeting on February 8-9, 1983, the
Committee established the following ranges for
growth of the monetary aggregates: for the period from February-March of 1983 to the fourth
quarter of 1983, 7 to 10 percent at an annual rate
for M2, taking into account the probability of
some residual shifting into that aggregate from
non-M2 sources; and for the period from the
fourth quarter of 1982 to the fourth quarter of
1983, 6V2 to 9V2 percent for M3, which appeared
to be less distorted by shifts associated with new
deposit accounts. For the same period, a tentative range of 4 to 8 percent was established for
M l , assuming that Super NOW accounts would
draw only modest amounts of funds from sources
outside Ml and that the authority to pay interest
on transaction accounts would not be extended
beyond currently eligible accounts. An associated range of growth for total domestic nonfinancial debt was estimated at 8V2 to IIV2 percent.
At the February meeting, the Committee
agreed that the near-term outlook for growth in
the monetary aggregates remained subject to
unusual uncertainties and that an appropriate
assessment of such growth would need to take
account of the distortions that might continue to
be created by the introduction of new deposit
accounts. Consequently, the Committee decided
that open market operations in the period until
this meeting should be directed toward maintaining the existing degree of restraint on reserve
positions. It was agreed that lesser restraint
would be acceptable in the context of appreciable slowing of growth in the monetary aggregates, to or below the paths implied by the longterm ranges.
M2 grew at an estimated annual rate of about
24 percent in February, only a little below the
exceptional pace in January, as its growth continued to be greatly affected by shifts of funds
from market instruments and other non-M2
sources into the new money market deposit
accounts (MMDAs) included in M2. M3 grew at
annual rates of about 12 and 13 ¥2 percent in
January and February respectively. However,
growth in both of the broader aggregates appeared to have decelerated substantially during
March. The deceleration reflected in part a
marked slowing in the volume of funds shifted
into MMDAs from market instruments and apparently also a moderation in the underlying
growth of the nontransaction component of these
aggregates. Growth in Ml accelerated to an
extraordinary annual rate of about 22 percent in
February, and, on the basis of preliminary data,
was estimated to have remained rapid in March,
though probably slowing somewhat from the
February rate. An acceleration in growth of
NOW accounts and a large increase in holdings
of currency contributed to the expansion in Ml.
The income velocity of Ml apparently declined
sharply in the first quarter, continuing the trend
that became evident in the course of 1982.
Total and nonborrowed reserves declined appreciably in February, but turned up in March.
The behavior of reserves did not reflect the
strength in the aggregates largely because required reserves at member banks were lowered
by shifts out of personal savings and small time
deposits into nonreservable MMDAs and there
was an associated runoff of large-denomination
CDs. The monetary base grew considerably
more than the reserve measures, owing to the
rapid expansion of currency in circulation. Adjustment borrowing (including seasonal borrowing) fluctuated between $140 million and $600
million over the intermeeting period. Excess
reserves were also volatile and were somewhat
higher than usual on average; strong demands for
excess reserves at times appeared to be related
to slow responses by banks to reductions in
reserve requirements. Federal funds continued
to trade near the 8V2 percent discount rate over
most of the intermeeting interval, though rising
to around 83A percent in the week prior to this
meeting.
Most short-term market interest rates rose
Record of Policy Actions of the FOMC
about Vs percentage point over the intermeeting
interval, while bond rates declined about Vs to V2
percentage point. The average rate on new commitments for fixed-rate conventional home mortgage loans at savings and loan associations declined 20 basis points further. At the end of
February, the prime rate charged by most commercial banks on short-term business loans was
reduced by Vi percentage point to IOV2 percent.
Total credit outstanding at U.S. commercial
banks, which had grown at an annual rate of
about 6 percent in the fourth quarter of 1982,
expanded at an average annual rate of about 10
percent over the first two months of this year.
Banks acquired a sizable volume of securities,
particularly Treasury securities, and also expanded their loans somewhat. Very preliminary
data suggested that the total debt of domestic
nonfinancial sectors was increasing in early 1983
at a rate near the lower end of the Committee's
estimated range for the year. There was a sharp
increase in the share of debt financed through
depository institutions, which had experienced
massive inflows of funds as a result of aggressive
marketing of the newly authorized MMDAs.
Staff projections presented at this meeting
indicated that real GNP would probably grow at
a moderate pace throughout 1983, with unemployment remaining high. Private final purchases
were projected to pick up somewhat in the latter
half of the year, partly in response to the third
phase of the tax cut. It was anticipated that the
liquidation of business inventories would end by
midyear and that some restocking of depleted
inventories would occur in the second half. The
rise in the average level of prices was expected to
remain moderate, even as economic recovery
proceeded over the balance of 1983, given the
favorable outlook for oil prices and the prospects
for continued limited increases in unit labor
costs.
In the Committee's discussion of the economic
situation and outlook, the members agreed that a
recovery in economic activity appeared to be
under way, although several commented that the
evidence available thus far was too fragmentary
to permit a firm evaluation of the strength of the
upturn. While the staff projection of moderate
growth for 1983 as a whole was cited as a
reasonable expectation, members commented on
the many uncertainties surrounding the econom
423
ic outlook and expressed differing views regarding the direction of possible deviations from the
staff projection.
Some members saw the staff projection as the
middle of a plausible range of possible outcomes
for 1983, given the outlook for fiscal and monetary policy. Several members believed, however,
that the risks of a deviation were in the direction
of a shortfall. These members stressed potential
obstacles to a vigorous recovery. These included
the possibility of further unsettlement in international and domestic financial markets, the outlook for poor export markets, and the prospects
for continuing weakness in business investment,
at least over the quarters immediately ahead,
against the backdrop of low capacity utilization
rates in industry and recent overbuilding of
many types of commercial properties. Reference
was also made to the retarding impact of relatively high real interest rates, and some members
expressed the view that an appreciable rise in
interest rates, if such a rise were to occur, could
greatly inhibit the recovery in interest-sensitive
sectors of the economy, such as housing and
automobiles, which had tended to lead the recovery thus far.
A differing view was expressed, which
stressed the possibility of a stronger recovery
that, like many previous recoveries in the postwar period, would tend to gather momentum as it
developed. In support of this view, it was noted
that private final purchases had risen appreciably
in the fourth and first quarters, and such purchases could strengthen markedly further in reaction to the federal tax cut at midyear and
anticipated improvement in business spending.
Moreover, cutbacks in inventories had been unusually pronounced during the recession, so that
gains in consumer spending would tend to be
translated directly into increased production.
Members referred to the favorable outlook for
prices in 1983, partly associated with an improved trend in productivity and reduced wagecost pressures, but some members also commented that the longer-run outlook for inflation
and for a sustainable recovery would be influenced greatly by progress in holding down future
federal deficits and by success in achieving the
Committee's objectives for monetary growth. It
was noted that the effects of an expansionary
federal budget would be offset to some extent by
424
Federal Reserve Bulletin • June 1983
efforts of state and local governments to curb
expenditures and to raise taxes. On balance,
however, it appeared that markets remained apprehensive about the outlook for the federal
budget, and that concern was reflected in continued pressures on interest rates, especially in
long-term debt markets.
In discussing a policy course for the weeks
immediately ahead, Committee members recognized that substantial uncertainties affected both
the economic outlook and the interpretation of
the monetary aggregates. Concern was expressed about the implications of the rapid
growth in the monetary aggregates, particularly
if it should continue. However, it was also noted
that the rapid expansion of recent months, given
the distortions related to various institutional
changes, probably did not have the significance
for future economic and price developments that
it might have had in the past. It was generally
recognized that much of the recent growth in the
broad aggregates, especially M2, reflected shifts
of investment preferences by individuals away
from market instruments toward the new
MMDAs, given the very attractive rates being
offered on the accounts by depository institutions in a highly competitive environment. Note
was also taken of the marked slowing in monetary growth that appeared to be in train for
March, and of a staff analysis suggesting that
underlying growth of the broad aggregates—as
well as growth in Ml—might be moderate in the
months ahead as the lagged effects of earlier
declines in market interest rates dissipated. With
respect to M l , most members felt that persistence of its unusually sharp decline in velocity
early this year cast doubt on the aggregate as a
principal guide for policy at this time; however, a
view was also expressed in favor of giving Ml
more weight in the formulation of the Committee's policy.
In evaluating the overall financial situation, it
was also pointed out that the strength of the
aggregates needed to be judged in the context of
the apparently moderate expansion of domestic
nonfinancial debt and of the relatively high level
of real interest rates. With the economic recovery still in its early and fragile stages, the view
was expressed that strong upward pressures on
interest rates would involve an unacceptable risk
of unduly retarding, and perhaps aborting, the
recovery. The view was also expressed that a
sustainable recovery might not develop at the
present levels of nominal and real interest rates.
On the other hand, no member expressed sentiment for a substantial easing in the existing
degree of reserve restraint in the absence of clear
evidence of a pronounced slowing in monetary
growth or of indications that the economic recovery was faltering.
While a few members indicated a preference
for leaning in the direction of slightly more, or
slightly less, restraint on reserve positions in the
period immediately ahead—depending on their
assessment of the economic outlook, credit conditions, and the monetary aggregates—all of the
members found acceptable a policy calling for
maintaining generally the current degree of reserve restraint, pending the availability of further
evidence on the behavior of the monetary aggregates and on the economic situation. The members anticipated that such a policy course would
be consistent with substantial slowing in the
growth of M2 and M3 to annual rates of about 9
percent and 8 percent respectively over the period from March to June; these growth rates
assumed that shifts of funds into the new deposit
accounts from market instruments would have
only a relatively small further impact on the
broad aggregates—perhaps no more than a percentage point or so in the case of M2. The
Committee also expected that Ml growth at an
annual rate of about 6 to 7 percent over the threemonth period would be associated with its objectives for the broader aggregates, assuming basically no distortion in Ml on balance from the
newly introduced accounts. Should these assumptions about distortions from the new accounts prove to be incorrect, it was understood
that appropriate adjustments would have to be
made in the monetary growth objectives.
The Committee members agreed that lesser
restraint on reserve positions would be acceptable in the context of more pronounced slowing
in the growth of the monetary aggregates, after
taking account of any distortions relating to the
introduction of new deposit accounts, or of evidence of a weakening in the pace of the economic
recovery. If monetary expansion proved to be
appreciably higher than expected, without being
clearly explained by the effects of ongoing institutional changes, it was understood that the
Record of Policy Actions of the FOMC
Committee would consult about the desirability
under the prevailing circumstances of any substantial further restraint on bank reserve positions. It was further understood that the intermeeting range for the federal funds rate, which
provides a mechanism for initiating consultation
of the Committee, would be retained at 6 to 10
percent.
At the conclusion of its discussion, the Committee issued the following domestic policy directive to the Federal Reserve Bank of New
York:
The information reviewed at this meeting suggests
that real G N P rose moderately in the first quarter,
after a decline in the fourth quarter; the turnaround
reflects a considerable slowing in inventory liquidation. Private final sales apparently increased only
slightly less than in the fourth quarter with housing
activity strengthening further. Business fixed investment has remained weak. Nonfarm payroll employment rose on balance in January and February, after
an extended period of declines; the civilian unemployment rate was unchanged in February at 10.4 percent.
In early 1983 the rise in average prices and the advance
in the index of average hourly earnings have slowed
further.
The weighted average value of the dollar against
major foreign currencies rose somewhat on balance
between early February and late March. The U . S .
merchandise trade deficit declined marginally in January.
M2 continued to grow at an exceptional rate in
February and M3 also expanded at a rapid pace, but
growth in both of the broader aggregates appears to be
decelerating substantially in March. The deceleration
reflects in part the marked slowing in growth of money
market deposit accounts (MMDAs) in recent w e e k s
and apparently also a moderation in the underlying
growth of these aggregates, abstracting from shifts
from market instruments. M l has expanded rapidly
since late January, largely reflecting accelerated
growth in N O W accounts. Growth in debt of domestic
nonfinancial sectors appears to have been moderate in
the first quarter. Short-term interest rates have risen
somewhat since early February while long-term rates,
including mortgage rates, have declined.
The Federal Open Market Committee seeks to foster monetary and financial conditions that will help to
reduce inflation further, promote a resumption of
growth in output on a sustainable basis, and contribute
to a sustainable pattern of international transactions.
At its meeting in February the Committee established
growth ranges for monetary and credit aggregates for
1983 in furtherance of these objectives. The Committee recognized that the relationships between such
ranges and ultimate economic goals have been less
predictable over the past year; that the current impact
425
of new deposit accounts on growth rates of monetary
aggregates cannot be determined with a high degree of
confidence; and that the availability of interest on
large portions of transaction accounts, declining inflation, and lower market rates of interest may be reflected in some changes in the historical trends in velocity.
A substantial shift of funds into M2 from market
instruments, including large certificates of deposit not
included in M2, in association with the extraordinarily
rapid build-up of money market deposit accounts, has
distorted growth in that aggregate during the first
quarter.
In establishing growth ranges for the aggregates for
1983 against this background, the Committee felt that
growth in M2 might be more appropriately measured
after the period of highly aggressive marketing of
money market deposit accounts has subsided. The
Committee also felt that a somewhat wider range was
appropriate for monitoring M l . Those growth ranges
will be reviewed in the spring and altered, if appropriate, in the light of evidence at that time.
With these understandings, the Committee established the following growth ranges: for the period from
February-March of 1983 to the fourth quarter of 1983,
7 to 10 percent at an annual rate for M2, taking into
account the probability of some residual shifting into
that aggregate from non-M2 sources; and for the
period from the fourth quarter of 1982 to the fourth
quarter of 1983, 6V2 to 9Vi percent for M3, which
appeared to be less distorted by the new accounts. For
the same period a tentative range of 4 to 8 percent was
established for M l , assuming that Super N O W accounts would draw only modest amounts of funds from
sources outside M l and assuming that the authority to
pay interest on transaction balances is not extended
beyond presently eligible accounts. An associated
range of growth for total domestic nonfinancial debt
was estimated at 8V2 to 11V* percent.
In implementing monetary policy, the Committee
agreed that substantial weight would be placed on
behavior of the broader monetary aggregates, expecting that distortions in M2 from the initial adjustment to
the new deposit accounts will abate. The behavior of
M l will be monitored, with the degree of weight placed
on that aggregate over time dependent on evidence
that velocity characteristics are resuming more predictable patterns. Debt expansion, while not directly
targeted, will be evaluated in judging responses to the
monetary aggregates. The Committee understood that
policy implementation would involve continuing appraisal of the relationships between the various measures of money and credit and nominal G N P , including
evaluation of conditions in domestic credit and foreign
exchange markets.
For the short run, the Committee seeks to maintain
generally the existing degree of restraint on reserve
positions, anticipating that would be consistent with a
slowing from March to June in growth of M2 and M3 to
annual rates of about 9 and 8 percent, respectively.
The Committee expects that M l growth at an annual
rate of about 6 to 7 percent would be consistent with
426
Federal Reserve Bulletin • June 1983
its objectives for the broader aggregates. Lesser restraint would be acceptable in the context of more
pronounced slowing of growth in the monetary aggregates relative to the paths implied by the long-term
ranges (taking account of the distortions relating to the
introduction of new accounts), or indications of a
weakening in the pace of economic recovery. The
Chairman may call for Committee consultation if it
appears to the Manager for Domestic Operations that
pursuit of the monetary objectives and related reserve
paths during the period before the next meeting is
likely to be associated with a federal funds rate persistently outside a range of 6 to 10 percent.
Votes for this action: Messrs. Volcker, Solomon,
Gramley, GuflFey, Keehn, Martin, Morris, Partee,
Rice, Roberts, Mrs. Teeters, and Mr. Wallich.
Votes against this action: N o n e .
2. Review
of Continuing
Authorizations
The Committee followed its customary practice
of reviewing all of its continuing authorizations
and directives at this first regular meeting of the
Federal Open Market Committee following the
election of new members from the Federal Reserve Banks to serve for the year beginning
March 1, 1983. The Committee reaffirmed the
authorization for foreign currency operations,
the foreign currency directive, and the procedural instructions with respect to foreign currency
operations in the forms in which they were
currently outstanding.
Votes for these actions: Messrs. Volcker, Solomon, Gramley, GuflFey, Keehn, Martin, Morris,
Partee, Rice, Roberts, Mrs. Teeters, and Mr. Wallich. Votes against these actions: N o n e .
3. Authorization
for Domestic
Market
Operations
Open
On the recommendation of the Manager for
Domestic Operations, System Open Market Account, the Committee amended paragraph 1(a) of
the authorization for domestic open market operations to raise from $3 billion to $4 billion the
limit on intermeeting changes in System account
holdings of U.S. government and federal agency
securities. The Manager noted that in recent
years the Committee had found it necessary to
authorize temporary increases in the limit with
greater frequency because of the longer intervals
between Committee meetings and the increased
size of the net variation in market factors affecting reserves. In 1981 and 1982, such temporary
increases had been authorized in half of the
intermeeting periods. A permanent increase in
the limit to $4 billion would reduce the number of
occasions requiring special Committee action,
while still calling to the Committee's attention
needs for particularly large changes. The Committee concurred in the Manager's view that
such an increase would be appropriate.
The Committee also approved the deletion of
paragraph 2 of the authorization, which had
authorized, under certain conditions, the direct
lending of securities held in the System account
to the U.S. Treasury and the purchase of special
short-term certificates of indebtedness directly
from the Treasury. Paragraph 2 had been in a
state of de facto suspension since June 1981
when the statutory authority on which it was
based expired. In the past, the Congress had
enacted the legislation for limited periods and
occasionally had allowed it to lapse prior to its
renewal. Since no legislation to renew the authority was under consideration, the Committee
concurred in a staff recommendation to delete
paragraph 2 and renumber the remaining paragraphs in the authorization. 1
Accordingly, effective March 28, 1983, the
authorization for domestic open market operations was amended to read as follows:
1. The Federal Open Market Committee authorizes
and directs the Federal Reserve Bank of N e w York, to
the extent necessary to carry out the most recent
domestic policy directive adopted at a meeting of the
Committee:
(a) To buy or sell U . S . Government securities,
including securities of the Federal Financing Bank,
and securities that are direct obligations of, or fully
guaranteed as to principal and interest by, any agency
of the United States in the open market, from or to
securities dealers and foreign and international accounts maintained at the Federal Reserve Bank of
1. The following conforming amendments to other Committee documents were also approved: deletion of section
270.4(d) of the Regulation Relating to Open Market Operations of Federal Reserve Banks and redesignation of the
remaining paragraph as 270.4(d); and deletion of paragraph 2
of the Resolution of Federal Open Market Committee Authorizing Certain Actions by Federal Reserve Banks during an
Emergency, and renumbering of remaining paragraphs.
Record of Policy Actions of the FOMC
N e w York, on a cash, regular, or deferred delivery
basis, for the System Open Market Account at market
prices, and, for such Account, to exchange maturing
U . S . Government and Federal agency securities with
the Treasury or the individual agencies or to allow
them to mature without replacement; provided that the
aggregate amount of U . S . Government and Federal
agency securities held in such Account (including
forward commitments) at the close of business on the
day of a meeting of the Committee at which action is
taken with respect to a domestic policy directive shall
not be increased or decreased by more than $4.0
billion during the period commencing with the opening
of business on the day following such meeting and
ending with the close of business on the day of the next
such meeting;
(b) When appropriate, to buy or sell in the open
market, from or to acceptance dealers and foreign
accounts maintained at the Federal Reserve Bank of
N e w York, on a cash, regular, or deferred delivery
basis, for the account of the Federal Reserve Bank of
N e w York at market discount rates, prime bankers
acceptances with maturities of up to nine months at
the time of acceptance that (1) arise out of the current
shipment of goods between countries or within the
United States, or (2) arise out of the storage within the
United States of goods under contract of sale or
expected to move into the channels of trade within a
reasonable time and that are secured throughout their
life by a warehouse receipt or similar document conveying title to the underlying goods; provided that the
aggregate amount of bankers acceptances held at any
one time shall not e x c e e d $100 million;
(c) To buy U.S. Government securities, obligations
that are direct obligations of, or fully guaranteed as to
principal and interest by, any agency of the United
States, and prime bankers acceptances of the types
authorized for purchase under 1(b) above, from dealers for the account of the Federal Reserve Bank of
N e w York under agreements for repurchase of such
securities, obligations, or acceptances in 15 calendar
days or less, at rates that, unless otherwise expressly
authorized by the Committee, shall be determined by
competitive bidding, after applying reasonable limitations on the volume of agreements with individual
dealers; provided that in the event Government securities or agency issues covered by any such agreement
are not repurchased by the dealer pursuant to the
agreement or a renewal thereof, they shall be sold in
the market or transferred to the System Open Market
Account; and provided further that in the event bankers acceptances covered by any such agreement are
not repurchased by the seller, they shall continue to be
held by the Federal Reserve Bank or shall be sold in
the open market.
2. In order to ensure the effective conduct of open
market operations, the Federal Open Market Committee authorizes and directs the Federal Reserve Banks
to lend U . S . Government securities held in the System
Open Market Account to Government securities dealers and to banks participating in Government securi
427
ties clearing arrangements conducted through a Federal Reserve Bank, under such instructions as the
Committee may specify from time to time.
3. In order to ensure the effective conduct of open
market operations, while assisting in the provision of
short-term investments for foreign and international
accounts maintained at the Federal Reserve Bank of
N e w York, the Federal Open Market Committee authorizes and directs the Federal Reserve Bank of N e w
York (a) for System Open Market Account, to sell
U . S . Government securities to such foreign and international accounts on the bases set forth in paragraph
1(a) under agreements providing for the resale by such
accounts of those securities within 15 calendar days on
terms comparable to those available on such transactions in the market; and (b) for N e w York Bank
account, when appropriate, to undertake with dealers,
subject to the conditions imposed on purchases and
sales of securities in paragraph 1(c), repurchase agreements in U . S . Government and agency securities, and
to arrange corresponding sale and repurchase agreements between its own account and foreign and international accounts maintained at the Bank. Transactions undertaken with such accounts under the
provisions of this paragraph may provide for a service
fee when appropriate.
Votes for these actions: Messrs. Volcker, Solomon, Gramley, Guflfey, Keehn, Martin, Morris,
Partee, Rice, Roberts, Mrs. Teeters, and Mr. Wallich. Votes against these actions: N o n e .
Subsequently, on May 9-10, 1983, members of
the Committee voted to increase from $4 billion
to $5 billion the limit on changes between Committee meetings in System Account holdings of
U.S. government and federal agency securities
specified in paragraph 1(a) of the authorization
for domestic open market operations, effective
May 10 for the period ending with the close of
business on May 24, 1983.
Votes for this action: Messrs. Volcker, Gramley,
Guflfey, Keehn, Martin, Morris, Partee, Rice, Roberts, Mrs. Teeters, Messrs. Wallich, and Timlen.
Votes against this action: N o n e . (Mr. Timlen voted
as alternate for Mr. Solomon.)
This action was taken on recommendation of
the Manager for Domestic Operations. The Manager had advised that since the March meeting,
large net purchases of securities had been undertaken to meet reserve needs due to increases in
currency in circulation and required reserves,
reducing the leeway for further purchases over
the intermeeting interval to slightly under $1
billion. It appeared likely that purchases in ex-
428
Federal Reserve Bulletin • June 1983
cess of that leeway would be required over the
remainder of the intermeeting period.
4. Agreement
with
Treasury
to Warehouse Foreign
Currencies
At its meeting on January 17-18, 1977, the Committee had agreed to a suggestion by the Treasury that the Federal Reserve undertake to
"warehouse" foreign currencies—that is, to
make spot purchases of foreign currencies from
the Exchange Stabilization Fund (ESF) and
simultaneously to make forward sales of the
same currencies at the same exchange rate to the
ESF. Pursuant to that agreement, the Committee
had agreed that the Federal Reserve would be
prepared to warehouse for the Treasury or for
the ESF up to $5 billion of eligible foreign
currencies. At this meeting the Committee reaffirmed the agreement on the terms adopted on
March 18, 1980, with the understanding that it
would be subject to annual review.
Votes for this action: Messrs. Volcker, Solomon,
Gramley, GufiFey, Keehn, Martin, Morris, Partee,
Rice, Roberts, Mrs. Teeters, and Mr. Wallich.
Votes against this action: N o n e .
429
Legal Developments
COMPLETE REVISION OF REGULATION
T
The Board is adopting a completely revised and simplified Regulation T. The new regulation incorporates
changes made in response to comments received on
the complete revision of Regulation T as well as
proposals previously published and adopted. The eleven accounts currently required to be maintained by
brokers and dealers will be consolidated into seven
accounts along functional lines. In addition, the new
regulation will facilitate option writing by institutions
and permit options clearing agencies to accept, under
specified conditions, any underlying security as the
required Regulation T deposit.
Effective November 21, 1983, or any earlier date
after June 20, 1983 at the option of the creditor, the
Board revises Regulation T as set forth below:
Part 220—Credit By Brokers And
Section
Section
Section
Section
Section
220.1
220.2
220.3
220.4
220.5
Section
Section
Section
Section
Section
Section
Section
Section
Section
Section
Section
Section
220.6
220.7
220.8
220.9
220.10
220.11
220.12
220.13
220.14
220.15
220.16
220.17
Dealers
Authority, purpose, and scope
Definitions
General provisions
Margin account
Margin account exceptions and special
provisions
Special memorandum account
Arbitrage account
Cash account
Nonsecurities credit account
Omnibus account
Broker-dealer credit account
Market functions account
Arranging for loans by others
Clearance of securities
Borrowing by creditors
Borrowing and lending securities
Requirements for list of OTC margin
stocks
Section 220.18 Supplement to Regulation T
Section 220.1—Authority, Purpose, and Scope
(a) Authority and purpose. Regulation T (this part) is
issued by the Board of Governors of the Federal
Reserve System (the Board) pursuant to the Securities
Exchange Act of 1934 (the Act) (15 U.S.C. § 78a et
seq.). Its principal purpose is to regulate extensions of
credit by and to brokers and dealers; it also covers
related transactions within the Board's authority under the Act. It imposes, among other obligations,
initial margin requirements and payment rules on
securities transactions.
(b) Scope.
(1) This part provides a margin account and seven
special purpose accounts in which to record all
financial relations between a customer and a creditor. Any transaction not specifically permitted in a
special account shall be recorded in a margin account.
(2) This part does not preclude any exchange, national securities association, or creditor from imposing additional requirements or taking action for its
own protection.
Section 220.2—Definitions
The terms used in this part have the meanings given
them in section 3(a) of the Act or as defined in this
section.
(a) "Credit balance" means the cash amount due the
customer in a margin account after debiting amounts
transferred to the special memorandum account.
(b) "Creditor" means any broker or dealer (as defined
in sections 3(a)(4) and 3(a)(5) of the Act), any member
of a national securities exchange, or any person associated with a broker or dealer (as defined in section
3(a)(18) of the Act), except for business entities controlling or under common control with the creditor.
(c) "Customer" includes:
(1) any person or persons acting jointly: (i) to or for
whom a creditor extends, arranges, or maintains any
credit; or (ii) who would be considered a customer
of the creditor according to the ordinary usage of the
trade;
(2) any partner in a firm who would be considered a
customer of the firm absent the partnership relationship; and
(3) any joint venture in which a creditor participates
and which would be considered a customer of the
creditor if the creditor were not a participant.
430
Federal Reserve Bulletin • June 1983
(d) "Debit balance" means the cash amount owed to
the creditor in a margin account after debiting amounts
transferred to the special memorandum account.
(e) "Delivery against payment," "Payment against
delivery," or a " C . O . D . transaction" refers to an
arrangement under which a creditor and a customer
agree that the creditor will deliver to, or accept from,
the customer, or the customer's agent, a security
against full payment of the purchase price.
(f) "Equity" means the total current market value of
security positions held in the margin account plus any
credit balance less the debit balance in the margin
account.
(g) "Escrow agreement" means any agreement issued
in connection with a call or put option under which a
bank, holding the underlying security, foreign currency, certificate of deposit, or required cash, is obligated
to deliver to the creditor (in the case of a call option) or
accept from the creditor (in the case of a put option)
the underlying security, foreign currency, or certificate of deposit against payment of the exercise price
upon exercise of the call or put.
(h) "Examining authority" means:
(1) the national securities exchange or other selfregulatory organization of which a creditor is a
member; or
(2) if not a member of any such self-regulatory
organization, the Regional Office of the Securities
and Exchange Commission (SEC) where the creditor has its principal place of business; or
(3) if a member of more than one self-regulatory
organization, the organization designated by the
SEC as the examining authority for the creditor.
(i) "Good faith margin" means the amount of margin
which a creditor, exercising sound credit judgment,
would customarily require for a specified security
position and which is established without regard to the
customer's other assets or securities positions held in
connection with unrelated transactions.
(j) "In or at the m o n e y " means the current market
price of the underlying security is not more than one
standard exercise interval below (with respect to a call
option) or above (with respect to a put option) the
exercise price of the option.
(k) "In the m o n e y " means the current market price of
the underlying security is not below (with respect to a
call option) or above (with respect to a put option) the
exercise price of the option.
(1) "Margin call" means a demand by a creditor to a
customer for a deposit of additional cash or securities
to eliminate or reduce a margin deficiency as required
under this part.
(m) "Margin deficiency" means the amount by which
the required margin e x c e e d s the equity in the margin
account.
(n) "Margin e x c e s s " means the amount by which the
equity in the margin account exceeds the required
margin. When the margin e x c e s s is represented by
securities, the current value of the securities is subject
to the percentages set forth in section 220.18 (the
Supplement).
(o) "Margin security" means any registered security,
OTC margin stock, OTC margin bond, or any security
issued by either an open-end investment company or
unit investment trust which is registered under section
8 of the Investment Company Act of 1940 (15 U . S . C .
§ 80a-8).
(p) " N o n e x e m p t e d security" means any security other than an exempted security (as defined in section
3(a)(12) of the Act).
(q) "Nonmember bank" means a bank that is not a
member of the Federal Reserve System.
(r) "OTC margin bond" means:
(1) A debt security not traded on a national securities exchange which meets all of the following
requirements:
(i) At the time of the original issue, a principal
amount of not less than $25,000,000 of the issue
was outstanding;
(ii) The issue was registered under section 5 of
the Securities Act of 1933 (15 U . S . C . § l i t ) and
the issuer either files periodic reports pursuant to
section 13(a) or 15(d) of the Act or is an insurance
company which meets all of the conditions specified in section 12(g)(2)(G) of the Act; and
(iii) At the time of the extension of credit, the
creditor has a reasonable basis for believing that
the issuer is not in default on interest or principal
payments; or
(2) A private mortgage pass-through security (not
guaranteed by an agency of the U.S. government)
meeting all of the following requirements:
(i) An aggregate principal amount of not less than
$25,000,000 (which may be issued in series) was
issued pursuant to a registration statement filed
with the SEC under section 5 of the Securities Act
of 1933;
Legal Developments
(ii) Current reports relating to the issue have been
filed with the SEC; and
(iii) At the time of the credit extension, the creditor has a reasonable basis for believing that mortgage interest, principal payments and other distributions are being passed through as required and
that the servicing agent is meeting its material
obligations under the terms of the offering.
(s) "OTC margin stock" means any equity security
not traded on a national securities exchange that the
Board has determined has the degree of national
investor interest, the depth and breadth of market, the
availability of information respecting the security and
its issuer, and the character and permanence of the
issuer to warrant being treated like an equity security
traded on a national securities exchange. An OTC
stock is not considered to be an "OTC margin stock"
until it appears on the Board's periodically published
list of OTC margin stocks.
(t) "Overlying option" means:
(1) a put option purchased or a call option written
against a long position in an underlying security in
the specialist record in section 220.12(b); or
(2) a call option purchased or a put option written
against a short position in an underlying security in
the specialist record in section 220.12(b).
(u) "Purpose credit" means credit for the purpose of:
(1) buying, carrying, or trading in securities; or
(2) buying or carrying any part of an investment
contract security which shall be deemed credit for
the purpose of buying or carrying the entire security.
(v) "Registered security" means any security that:
(1) is registered on a national securities exchange;
or
(2) has unlisted trading privileges on a national
securities exchange.
(w) "Short call or short put" means a call option or a
put option that is issued, endorsed, or guaranteed in or
for an account.
(1) A short call obligates the customer to sell the
underlying security, foreign currency, or certificate
of deposit at the exercise price upon receipt of an
exercise notice at any time prior to the expiration
date of the option.
(2) A short put obligates the customer to purchase
the underlying security, foreign currency, or certificate of deposit at the exercise price upon receipt of
an exercise notice at any time prior to the expiration
date of the option.
431
(3) A short call or a short put on stock index options
obligates the customer to pay the holder of an "in
the m o n e y " long put or call w h o has exercised the
option the cash difference between the exercise
price and the current assigned value of the index as
established by the option contract.
(x) "Specialist joint account" means an account
which, by written agreement, provides for the commingling of the security positions of the participants
and a sharing of profits and losses from the account on
some predetermined ratio.
(y) "Underlying security" means the security that
will be delivered upon exercise of an option.
Section 220.3—General Provisions
(a) Records. The creditor shall maintain a record for
each account showing the full details Ofsall transactions.
(b) Separation of accounts. Except as provided for in
the margin account and the special memorandum
account, the requirements of an account may not be
met by considering items in any other account. If
withdrawals of cash or securities are permitted under
the regulation, written entries shall be made when cash
or securities are used for purposes of meeting requirements in another account.
(c) Maintenance
of credit. Except as prohibited by
this part, any credit initially extended in compliance
with this part may be maintained regardless of:
(1) reductions in the customer's equity resulting
from changes in market prices;
(2) any security in an account ceasing to be margin
or exempted; or
(3) any change in the margin requirements prescribed under this part.
(d) Guarantee of accounts. N o guarantee of a customer's account shall be given any effect for purposes of
this part.
(e) Receipt of funds or
securities.
(1) A creditor, acting in good faith, may accept as
immediate payment:
(i) cash or any check, draft, or order payable on
presentation; or
(ii) any security with sight draft attached.
(2) A creditor may treat a security, check or draft as
received upon written notification from another
creditor that the specified security, check, or draft
has been sent.
432
Federal Reserve Bulletin • June 1983
(3) U p o n notification that a check, draft, or order
has been dishonored or when securities have not
been received within a reasonable time, the creditor
shall take the action required by this part when
payment or securities are not received on time.
(f) Exchange of
securities.
(1) To enable a customer to participate in an offer to
exchange securities which is made to all holders of
an issue of securities, a creditor may submit for
exchange any securities held in a margin account,
without regard to the other provisions of this part,
provided the consideration received is deposited
into the account.
(2) If a nonmargin, nonexempted security is acquired in exchange for a margin security, its retention, withdrawal, or sale within 60 days following its
acquisition shall be treated as if the security is a
margin security.
(g) Valuing securities. The current market value of a
security shall be determined as follows:
(1) Throughout the day of the purchase or sale of a
security, the creditor shall use the security's total
cost of purchase or the net proceeds of its sale
including any commissions charged.
(2) At any other time, the creditor shall use the
closing sale price of the security on the preceding
business day, as shown by any regularly published
reporting or quotation service. If there is no closing
price, the creditor may use any reasonable estimate
of the market value of the security as of the close of
business on the preceding business day.
(h) Innocent mistakes. If any failure to comply with
this part results from a mistake made in good faith in
executing a transaction or calculating the amount of
margin, the creditor shall not be deemed in violation of
this part if, promptly after the discovery of the mistake, the creditor takes appropriate corrective action.
(i) Variable annuity contracts
issued by
insurance
companies.
Any insurance company that issues or
sells variable annuity contracts or engages in a general
securities business as a broker or dealer shall be
subject to this part only for transactions in connection
with those activities. Extensions of credit associated
with conventional lending practices of insurance companies are subject to Part 207 of this Chapter.
Section 220.4—Margin Account
(a) Margin
transactions.
(1) All transactions not specifically authorized for
inclusion in another account shall be recorded in the
margin account.
(2) A creditor may establish separate margin accounts for the same person to:
(i) clear transactions for other creditors where the
transactions are introduced to the clearing creditor by separate creditors; or
(ii) clear transactions through other creditors if
the transactions are effected by separate creditors; or
(iii) provide one or more accounts over which the
creditor or a third party investment adviser has
investment discretion.
(b) Required margin. The required margin for each
position in securities is set forth in section 220.18 (the
Supplement) and is subject to the exceptions and
special provisions contained in section 220.5 (Margin
Account Exceptions and Special Provisions).
(c) When additional margin is required.
(1) Computing deficiency.
All transactions on the
same day shall be combined to determine whether
additional margin is required by the creditor. For the
purpose of computing equity in an account, security
positions are established or eliminated and a credit
or debit created on the trade date of a security
transaction. Additional margin is required on any
day when the day's transactions create or increase a
margin deficiency in the account and shall be for the
amount of the margin deficiency.
(2) Satisfaction
of deficiency.
The additional required margin may be satisfied by a transfer from
the special memorandum account or by a deposit of
cash, margin securities, exempted securities, or any
combination thereof.
(3) Time limits.
(i) A margin call shall be satisfied within 7 business days after the margin deficiency was created
or increased.
(ii) The 7 day period may be extended for one or
more limited periods upon application by the
creditor to a self-regulatory organization or national securities association unless the organization or association believes that the creditor is not
acting in good faith or that the creditor has not
sufficiently determined that exceptional circumstances warrant such action. Applications shall be
filed and acted upon prior to the end of the 7 day
period or the expiration of any subsequent extension. H o w e v e r , applications filed by firms having
no direct electronic access to the organization or
association may be accepted as timely filed if
postmarked by midnight of the last day of the 7
day period or any subsequent extension.
Legal Developments
(4) Satisfaction
restriction.
Any transaction, position, or deposit that is used to satisfy one requirement under this part shall be unavailable to satisfy
any other requirement.
(d) Liquidation in lieu of deposit. If any margin call is
not met in full within the required time, the creditor
shall liquidate securities sufficient to meet the margin
call or to eliminate any margin deficiency existing on
the day such liquidation is required, whichever is less.
If the margin deficiency created or increased is $500 or
less, no action need be taken by the creditor.
(e) Withdrawals of cash or securities.
(1) Cash or securities may be withdrawn from an
account, except if:
(i) additional cash or securities are required to be
deposited into the account for a transaction on the
same or a previous day ; or
(ii) the withdrawal, together with other transactions, deposits, and withdrawals on the same day,
would create or increase a margin deficiency.
(2) Margin e x c e s s may be withdrawn or may be
transferred to the special memorandum account
(section 220.6) by making a single entry to that
account which will represent a debit to the margin
account and a credit to the special memorandum
account.
(3) If a creditor does not receive a distribution of
cash or securities which is payable with respect to
any security in a margin account on the day it is
payable and withdrawal would not be permitted
under this paragraph, a withdrawal transaction shall
be deemed to have occurred on the day the distribution is payable.
(f) Interest, service charges,
etc.
(1) Without regard to the other provisions of this
section, the creditor, in its usual practice, may debit
the following items to a margin account if they are
considered in calculating the balance of such account:
(i) interest charged on credit maintained in the
margin account;
(ii) premiums on securities borrowed in connection with short sales or to effect delivery;
(iii) dividends, interest, or other distributions due
on borrowed securities;
(iv) communication or shipping charges with respect to transactions in the margin account; and
(v) any other service charges which the creditor
may impose.
(2) A creditor may permit interest, dividends, or
other distributions credited to a margin account to
433
be withdrawn from the account if:
(i) the withdrawal does not create or increase a
margin deficiency in the account; or
(ii) the current market value of any securities
withdrawn does not e x c e e d 10 per cent of the
current market value of the security with respect
to which they were distributed.
Section 220.5—Margin Account Exceptions and
Special Provisions.
(a) Unissued
securities.
(1) The required margin on a net long or net short
commitment in an unissued security is the margin
that would be required if the security were an issued
margin security, plus any unrealized loss on the
commitment or less any unrealized gain.
(2) Margin is not required on a net short commitment in unissued securities when the account contains the related issued securities, nor for any net
short or net long position in unissued exempted
securities.
(b) Short sales.
(1) The required margin for the short sale of a
security shall be the amount set forth in section
220.18 (the Supplement).
(2) A short sale "against the b o x " shall be treated
as a long sale for the purpose of computing the
equity and the required margin.
(c) Options.
(1) Margin or cover for options on exempted
debt
securities, certificates of deposit, stock indices, or
securities exchange traded options on foreign currencies. The required margin for each transaction
involving any short put or short call on an exempted
debt security, certificate of deposit, stock index, or
foreign currency (if the option is traded on a securities exchange), shall be the amount or positions in
lieu of margin set forth in section 220.18 (the Supplement).
(2) Margin for options on equity securities.
The
required margin for each transaction involving any
short put or short call on an equity security shall be
the amount set forth in section 220.18 (the Supplement), plus any unrealized loss on the commitment
or minus any unrealized gain. However, the required margin may not e x c e e d the current market
value of the underlying security in the case of a call,
or the exercise price in the case of a put.
(3) Cover or positions in lieu of margin. N o margin
is required for an option written on an equity
security position when the account holds any of the
following:
434
Federal Reserve Bulletin • June 1983
(i) the underlying security in the case of a short
call, or a short position in the underlying security
in the case of a short put;
(ii) securities immediately convertible into or exchangeable for the underlying security without the
payment of money in the case of a short call, if the
right to convert or exchange does not expire on or
before the expiration date of the short call;
(iii) an escrow agreement for the underlying security or foreign exchange (in the case of a short
call) or cash (in the case of a short put);
(iv) a long call on the same number of shares of
the same underlying security if the long call does
not expire before the expiration date of the short
call, and if the amount (if any), by which the
exercise price of the long call exceeds the exercise
price of the short call is deposited in the account;
(v) a long put on the same number of shares of the
same underlying security if the long put does not
expire before the expiration date of the short put,
and if the amount (if any), by which the exercise
price of the short put e x c e e d s the exercise price of
the long put is deposited in the account;
(vi) a warrant to purchase the underlying security, in the case of a short call, if the warrant does
not expire on or before the expiration date of the
short call, and if the amount (if any), by which the
exercise price of the warrant exceeds the exercise
price of the short call is deposited in the account.
A warrant used in lieu of the required margin
under this provision shall contribute no equity to
the account.
(4)
Adjustments.
(i) When a short position held in the account
serves in lieu of the required margin for a short
put, the amount prescribed by paragraph (c)(2) of
this section as the amount to be added to the
required margin in respect of short sales shall be
increased by any unrealized loss on the position.
(ii) When a security held in the account serves in
lieu of the required margin for a short call, the
security shall be valued at no greater than the
exercise price of the short call.
(5) Straddles. When both a short put and a short call
are in a margin account on the same number of
shares of the same underlying security, the required
margin shall be the margin on either the short put or
the short call, whichever is greater, plus any unrealized loss on the other option.
(6) Exclusive designation. The customer may designate at the time the option order is entered which
security position held in the account is to serve in
lieu of the required margin, if such service is offered
by the creditor; or the customer may have a standing
agreement with the creditor as to the method to be
used for determining on any given day which security position will be used in lieu of the margin to
support an option transaction. Any security held in
the account which serves in lieu of the required
margin for a short put or a short call shall be
unavailable to support any other option transaction
in the account.
(d) Accounts of partners. If a partner of the creditor
has a margin account with the creditor, the creditor
shall disregard the partner's financial relations with
the firm (as shown in the partner's capital and ordinary
drawing accounts) in calculating the margin or equity
of the partner's margin account.
(e) Contribution to joint venture. If a margin account
is the account of a joint venture in which the creditor
participates, any interest of the creditor in the joint
account in e x c e s s of the interest which the creditor
would have on the basis of its right to share in the
profits shall be treated as an extension of credit to the
joint account and shall be margined as such.
(f) Transfer of accounts.
(1) A margin account that is transferred from one
creditor to another may be treated as if it had been
maintained by the transferee from the date of its
origin, if the transferee accepts, in good faith, a
signed statement of the transferor (or, if that is not
practicable, of the customer), that any margin call
issued under this part has been satisfied.
(2) A margin account that is transferred from one
customer to another as part of a transaction, not
undertaken to avoid the requirements of this part,
may be treated as if it had been maintained for the
transferee from the date of its origin, if the creditor
accepts in good faith and keeps with the transferee
account a signed statement of the transferor describing the circumstances for the transfer.
Section 220.6—Special Memorandum Account.
(a) A special memorandum account (SMA) may be
maintained in conjunction with a margin account. A
single entry amount may be used to represent both a
credit to the S M A and a debit to the margin account. A
transfer between the t w o accounts may be effected by
an increase or reduction in the entry. When computing
the equity in a margin account, the single entry amount
shall be considered as a debit in the margin account. A
payment to the customer or on the customer's behalf
or a transfer to any of the customer's other accounts
from the S M A reduces the single entry amount.
Legal Developments
(b) The S M A may contain the following entries:
(1) dividend and interest payments;
(2) cash not required by this part, including cash
deposited to meet a maintenance margin call or to
meet any requirement of a self-regulatory organization that is not imposed by this part;
(3) proceeds of a sale of securities or cash no longer
required on any expired or liquidated security- position that may be withdrawn under section 220.4(e) of
this part; and
(4) margin e x c e s s transferred from the margin account under section 220.4(e)(2) of this part.
Section 220.7—Arbitrage Account
In an arbitrage account a creditor may effect and
finance for any customer bona fide arbitrage transactions. For the purpose of this section, the term bona
fide arbitrage" means:
(1) a purchase or sale of a security in one market
together with an offsetting sale or purchase of the
same security in a different market at as nearly the
same time as practicable for the purpose of taking
advantage of a difference in prices in the two markets, or
(2) a purchase of a security which is, without restriction other than the payment of money, exchangeable or convertible within 90 calendar days of
the purchase into a second security together with an
offsetting sale of the second security at or about the
same time, for the purpose of taking advantage of a
concurrent disparity in the prices of the two securities.
Section 220.8—Cash Account
(a) Permissible
transactions.
In a cash account, a
creditor may:
(1) buy for or sell to any customer any security if:
(i) there are sufficient funds in the account; or
(ii) the creditor accepts in good faith the customer's agreement that the customer will promptly
make full cash payment for the security before
selling it and does not contemplate selling it prior
to making such payment;
(2) buy from or sell for any customer any security if:
(i) the security is held in the account; or
(ii) the creditor accepts in good faith the customer's statement that the security is owned by the
customer or the customer's principal, and that it
will be promptly deposited in the account;
(3) issue, endorse, or guarantee an option for any
customer if:
(i) in the case of a call option, the underlying
security (or a security immediately convertible
435
into the underlying security, without the payment
of money) is held in or purchased for the account
on the same day, and the option premium is held
in the account until cash payment for the underlying or convertible security is received; or
(ii) in the case of a put option, the creditor obtains
cash in an amount equal to the exercise price or
holds in the account any of the following instruments with a current market value at least equal to
the exercise price and with one year or less to
maturity: securities issued or guaranteed by the
United States or its agencies, negotiable bank
certificates of deposit, or bankers acceptances
issued by banking institutions in the United States
and payable in the United States.
(4) use an escrow agreement in lieu of the cash or
underlying security position if:
(i) in the case of a call or a put, the creditor is
advised by the customer that the required securities or cash are held by a bank and the creditor
independently verifies that an appropriate escrow
agreement will be delivered by the bank promptly;
or
(ii) in the case of a call issued, endorsed, or
guaranteed on the same day the underlying security is purchased in the account and the underlying
security is to be delivered to a bank, the creditor
verifies that an appropriate escrow agreement will
be delivered by the bank promptly.
(b) Time periods for payment; cancellation or liquidation.
(1) Full cash payment.
A creditor shall obtain full
cash payment for customer purchases within 7 business days of the date:
(i) any nonexempted security was purchased;
(ii) any unissued security was made available by
the issuer for delivery to purchasers;
(iii) any "when distributed" security was distributed under a published plan;
(iv) a security owned by the customer has matured or has been redeemed and a new refunding
security of the same issuer has been purchased by
the customer, provided:
(A) the customer purchased the new security
no more than 35 calendar days prior to the date
of maturity or redemption of the old security;
(B) the customer is entitled to the proceeds of
the redemption; and
(C) the delayed payment does not exceed 103
percent of the proceeds of the old security.
(2) Delivery
against payment.
If a creditor purchases for or sells to a customer a security in a
delivery against payment transaction, the creditor
shall have up to 35 calendar days to obtain payment
436
Federal Reserve Bulletin • June 1983
if delivery of the security is delayed due to the
mechanics of the transaction and is not related to the
customer's willingness or ability to pay.
(3) Shipment of securities,
extension. If any shipment of securities is incidental to consummation of a
transaction, a creditor may extend the 7 business
day period by the number of days required for
shipment, but not by more than 7 business days.
(4) Cancellation;
liquidation; minimum amount. A
creditor shall promptly cancel or otherwise liquidate
a transaction, or any part of a transaction for which
the customer has not made full cash payment within
the required time. A creditor may, at its option,
disregard any sum due from the customer not exceeding $500.
(c) 90 day freeze.
(1) If a nonexempted security in the account is sold
or delivered to another broker or dealer without
having been previously paid for in full by the customer, the privilege of delaying payment beyond the
trade date shall be withdrawn for 90 calendar days
following the date of sale of the security. Cancellation of the transaction other than to correct an error
shall constitute a sale.
(2) The 90 day freeze shall not apply if: (i) within 7
business days of the trade date, full payment is
received or any check or draft in payment has
cleared and the proceeds from the sale are not
withdrawn prior to such payment or check clearance; or (ii) the purchased security was delivered to
another broker or dealer for deposit in a cash
account which holds sufficient funds to pay for the
security. The creditor may rely on a written statement accepted in good faith from the other broker or
dealer that sufficient funds are held in the other cash
account.
(d) Extension of time periods;
transfers.
(1) Unless a self-regulatory organization or association believes that the creditor is not acting in good
faith or that the creditor has not sufficiently determined that exceptional circumstances warrant such
action, it may, upon application by the creditor:
(i) extend any period specified in paragraph (b) of
this section;
(ii) authorize transfer to another account of any
transaction involving the purchase of a margin or
exempted security; or
(iii) grant a waiver from the 90 day freeze.
(2) Applications shall be filed and acted upon prior
to the end of the 7 day period or the expiration of
any subsequent extension. However, an application
filed from firms having no direct electronic access to
the exchange or association may be accepted as
timely filed if it is postmarked no later than midnight
of the last day of the 7 day period or any subsequent
extension.
Section 220.9—Nonsecurities Credit Account
(a) In a nonsecurities credit account a creditor may:
(1) Effect and carry transactions in commodities;
(2) Effect and carry transactions in foreign exchange;
(3) Extend and maintain secured or unsecured nonpurpose credit, subject to the requirements of paragraph (b) of this section.
(b) Every extension of credit, except as provided in
paragraphs (a)(1) and (2) of this section, shall be
deemed to be purpose credit unless, prior to extending
the credit, the creditor accepts in good faith from the
customer a written statement that it is not purpose
credit. The statement shall conform to the requirements established by the Board. To accept the customer's statement in good faith, the creditor shall be aware
of the circumstances surrounding the extension of
credit and shall be satisfied that the statement is
truthful.
Section 220.10—Omnibus Account
(a) In an omnibus account, a creditor may effect and
finance transactions for a broker or dealer w h o is
registered with the SEC under section 15 of the Act
and who gives the creditor written notice that:
(1) all securities will be for the account of customers
of the broker or dealer; and
(2) any short sales effected will be short sales made
on behalf of the customers of the broker or dealer
other than partners.
(b) The written notice required by paragraph (a) shall
conform to any S E C rule on the hypothecation of
customers' securities by brokers or dealers.
Section 220.11—Broker-dealer Credit Account
(a) Permissible transactions.
In a broker-dealer credit
account, a creditor may:
(1) Purchase any security from or sell any security
to another creditor under a good faith agreement to
promptly deliver the security against full payment of
the purchase price.
(2) Effect or finance transactions of any of its owners if the creditor is a clearing and servicing broker
or dealer owned jointly or individually by other
creditors.
(3) Extend and maintain credit to any partner or
Legal Developments
stockholder of the creditor for the purpose of making a capital contribution to, or purchasing stock of,
the creditor, affiliated corporation or another creditor.
(4) Extend and maintain, with the approval of the
appropriate examining authority:
(i) credit to meet the emergency needs of any
creditor; or
(ii) subordinated credit to another creditor for
capital purposes, if the other creditor:
(A) is an affiliated corporation; or
(B) will not use the proceeds of the loan to
increase the amount of dealing in securities for
the account of the creditor, its firm or corporation or an affiliated corporation.
(b) For purposes of paragraph (a)(3) and (4) of this
section "affiliated corporation" means a corporation
all the common stock of which is owned directly or
indirectly by the firm or general partners and employees of the firm, or by the corporation or holders of the
controlling stock and employees of the corporation
and the affiliation has been approved by the creditor's
examining authority.
Section 220.12—Market Functions Account
(a) Requirements.
In a market functions account, a
creditor may effect or finance the transactions of
market participants in accordance with the following
provisions. A separate record shall be kept for the
transactions specified for each category described in
paragraphs (b) through (e) of this section. Any position
in a separate record shall not be used to meet the
requirements of any other category.
(b)
Specialists.
(1) Applicability.
A creditor may clear or finance
specialist transactions for any specialist, or any
specialist joint account, in which all participants, or
all participants other than the creditor, are registered as specialists on a national securities exchange
that requires regular reports on the use of specialist
credit from the registered specialists.
(2) Permitted
offset positions.
A specialist in options may establish, on a share-for-share basis, a
long or short position in the securities underlying the
options in which the specialist makes a market, and
a specialist in securities other than options may
purchase or write options overlying the securities in
which the specialist makes a market, if the account
holds the following permitted offset positions:
(i) a short option position which is "in or at the
m o n e y " and is not offset by a long or short option
position for an equal or greater number of shares
437
of the same underlying security which is "in the
money";
(ii) a long option position which is "in or at the
m o n e y " and is not offset by a long or short option
position for an equal or greater number of shares
of the same underlying security which is "in the
money";
(iii) a short option position against which an exercise notice was tendered;
(iv) a long option position which was exercised;
(v) a net long position in a security (other than an
option) in which the specialist makes a market; or
(vi) a net short position in a security (other than
an option) in which the specialist makes a market.
(3) Required
margin. The required margin for a
specialist's transactions shall be:
(i) good faith margin for any long or short position
in a security in which the specialist makes a
market;
(ii) good faith margin for any wholly-owned margin security or exempted security ;
(iii) the margin prescribed by section 220.18 (the
Supplement) when a security purchased or sold
short in the account does not qualify as a specialist or permitted offset position.
(4) Additional margin; restriction on
"free-riding."
(i) Except as required by paragraph (b)(5) of this
section, the creditor shall issue a margin call on
any day w h e n additional margin is required as a
result of specialist transactions. The creditor may
allow the specialist a maximum of 7 business days
to satisfy a margin call.
(ii) If a specialist fails to satisfy a margin call
within the period specified in this paragraph (and
the creditor is required to liquidate securities to
satisfy the call), the creditor shall be prohibited
for a 15 calendar day period from extending any
further credit to the specialist to finance transactions in nonspecialty securities.
(iii) The restriction on "free-riding" shall not
apply to:
(A) any specialist on a national securities exchange that has an S EC-approved rule on
"free-riding" by specialists; or
(B) the acquisition or liquidation of a permitted
offset position.
(5) Deficit status. On any day when a specialist's
separate record would liquidate to a deficit, the
creditor shall not extend any further specialist credit
in the account and shall issue a margin call at least as
large as the deficit. If the call is not met by noon of
the following business day, the creditor shall liquidate positions in the specialist's account.
(6) Withdrawals.
Withdrawals may be permitted to
the extent that the equity e x c e e d s the margin re-
438
Federal Reserve Bulletin • June 1983
quirements specified in paragraph (b)(3) of this
section.
(c) Underwritings
and distributions.
A creditor may
effect or finance for any dealer or group of dealers
transactions for the purpose of facilitating the underwriting or distribution of all or a part of an issue of
securities with a good faith margin.
(d) OTC marketmakers
and third
marketmakers.
(1) A creditor may clear or finance with a good faith
margin, marketmaking transactions for an OTC marketmaker or a third marketmaker who:
(i) is in compliance with any applicable SEC rule,
including minimum net capital rules;
(ii) regularly submits bona fide competitive bid
and offer quotations to a recognized inter-dealer
quotation system;
(iii) is ready, willing, and able to effect transactions in reasonable amounts with other brokers
and dealers at the quoted prices; and
(iv) has a reasonable average rate of inventory
turnover.
(2) If the credit extended to a marketmaker ceases
to be for the purpose of marketmaking, or the dealer
ceases to be a marketmaker for an issue of securities
for which credit was extended, the credit shall be
subject to the margin specified in section 220.18 (the
Supplement).
(e) Odd-lot dealers. A creditor may clear and finance
odd-lot transactions for any creditor w h o is registered
as an odd-lot dealer on a national securities exchange
with a good faith margin.
Section 220.13—Arranging for Loans by Others
A creditor may not arrange for the extension or
maintenance of credit to or for any customer by any
person upon terms and conditions other than those
upon which the creditor may itself extend or maintain
credit under the provisions of this part, except that this
limitation shall not apply to credit arranged for a
customer which does not violate Parts 207 and 221 of
this Chapter and results solely from:
(a) investment banking services, provided by the
creditor to the customer, including, but not limited
to, underwritings, private placements, and advice
and other services in connection with exchange
offers, mergers or acquisitions, except for underwritings that involve the public distribution of an
equity security with installment or other deferred
payment provisions; or
(b) the sale of nonmargin securities (including securities with installment or other deferred payment
provisions) if the sale is exempted from the registration requirements of the Securities Act of 1933
under section 4(2) or section 4(6) of the Act.
Section 220.14—Clearance of Securities
(a) Credit for clearance of securities. The provisions
of this part shall not apply to the extension or maintenance of any credit that is not for more than one day if
it is incidental to the clearance of transactions in
securities directly b e t w e e n members of a national
securities exchange or association or through any
clearing agency registered with the SEC.
(b) Deposit of securities with options clearing
agency.
The provisions of this part shall not apply to the
deposit of securities with an options clearing agency
for the purpose of meeting its deposit requirements if:
(1) the clearing agency issues options on securities;
(2) the clearing agency is registered with the SEC;
(3) the deposit consists of any underlying securities
for classes of option contracts outstanding at the
time of the deposit; and
(4) the deposit complies with the rules of the clearing agency which have been approved by the SEC.
Section 220.15—Borrowing by Creditors
(a) Restrictions
on borrowing.
A creditor may not
borrow in the ordinary course of business as a broker
or dealer using as collateral any registered nonexempted security, except:
(1) from or through a member bank of the Federal
Reserve System; or
(2) from any nonmember bank that has filed with
the Board an agreement as prescribed in paragraph
(b) of this section, which agreement is still in effect;
or
(3) from another creditor if the loan is permissible
under this part.
(b) Agreements
of nonmember
banks.
(1) A nonmember bank shall file an agreement that
conforms to the requirements of section 8(a) of the
Act (See Form F.R. T-2) if:
(i) its principal place of business is in a territory
or insular possession of the United States; or
(ii) it has an office or agency in the United States
and its principal place of business is outside the
United States.
(2) Any other nonmember bank shall file an agreement that conforms to the requirements of section
8(a) of the Act (See Form F.R. T-l).
(3) Any nonmember bank may terminate its agreement if it obtains the written consent of the Board.
Legal Developments
Section 220.16—Borrowing and Lending
Securities
Without regard to the other provisions of this part, a
creditor may borrow or lend securities for the purpose
of making delivery of the securities in the case of short
sales, failure to receive securities required to be delivered, or other similar situations. Each borrowing shall
be secured by a deposit of one or more of the following: cash, securities issued or guaranteed by the United States or its agencies, negotiable bank certificates
of deposit and bankers acceptances issued by banking
institutions in the United States and payable in the
United States, or irrevocable letters of credit issued by
a bank insured by the Federal Deposit Insurance
Corporation or a foreign bank that has filed an agreement with the Board on Form F.R. T-2. Such deposit
made with the lender of the securities shall have at all
times a value at least equal to 100 per cent of the
market value of the securities borrowed, computed as
of the close of the preceding business day.
Section 220.17—Requirements for List of OTC
Margin Stocks
(a) Requirements
for inclusion on the list. Except as
provided in paragraph (d) of this section, OTC margin
stock shall meet the following requirements:
(1) Four or more dealers stand willing to, and do in
fact, make a market in such stock and regularly
submit bona fide bids and olfers to an automated
quotations system for their own accounts;
(2) The minimum average bid price of such stock, as
determined by the Board, is at least $5 per share;
(3) The stock is registered under section 12 of the
Act, or is an American Depository Receipt (ADR) of
a foreign issuer w h o s e securities are registered
under section 12 of the Act, or is a stock of a foreign
issuer required to file reports under section 15(d) of
the Act;
(4) Daily quotations for both bid and asked prices
for the stock are continuously available to the
general public;
(5) The stock has been publicly traded for at least
six months;
(6) The issuer has at least $4 million of capital,
surplus, and undivided profits;
(7) There are 400,000 or more shares of such stock
outstanding in addition to shares held beneficially by
officers, directors or beneficial owners of more than
10 per cent of the stock;
(8) There are 1,200 or more holders of record, as
defined in S E C Rule 12g5-l (17 CFR § 240.12g5-l),
of the stock w h o are not officers, directors or
beneficial owners of 10 per cent or more of the
439
stock, or the average daily trading volume of such
stock as determined by the Board, is at least 500
shares; and
(9) The issuer has been in existence for at least
three years.
(b) Requirements
for continued inclusion on the list.
Except as provided in paragraph (d) of this section,
OTC margin stock shall meet the following requirements:
(1) Three or more dealers stand willing to, and do in
fact, make a market in such stock and regularly
submit bona fide bids and offers to an automated
quotations system for their own accounts;
(2) The minimum average bid price of such stocks,
as determined by the Board, is at least $2 per share;
(3) The stock is registered as specified in paragraph
(a)(3) of this section.
(4) Daily quotations for both bid and asked prices
for the stock are continuously available to the
general public;
(5) The issuer has at least $1 million of capital,
surplus, and undivided profits;
(6) There are 300,000 or more shares of such stock
outstanding in addition to shares held beneficially by
officers, directors, or beneficial owners of more than
10 per cent of the stock; and
(7) There continue to be 800 or more holders of
record, as defined in SEC Rule 12g5-l (17 CFR
§ 240.12g5-l), of the stock w h o are not officers,
directors, or beneficial owners of 10 per cent or
more of the stock, or the average daily trading
volume of such stock, as determined by the Board,
is at least 300 shares.
(c) Removal from the list. The Board shall periodically remove from the list any stock that:
(1) ceases to exist or of which the issuer ceases to
exist, or
(2) no longer substantially meets the provisions of
paragraph (b) of this section or section 220.2(s).
(d) Discretionary
authority of Board. Without regard
to the other paragraphs of this section, the Board may
add to, or omit or remove from the OTC margin stock
list, any equity security, if in the judgment of the
Board, such action is necessary or appropriate in the
public interest.
It shall be unlawful for
(e) Unlawful representations.
any creditor to make, or cause to be made, any
representation to the effect that the inclusion of a
security on the list of OTC margin stocks is evidence
that the Board or the SEC has in any way passed upon
the merits of, or given approval to, such security or
any transactions therein. Any statement in an adver-
440
Federal Reserve Bulletin • June 1983
tisement or other similar communication containing a
reference to the Board in connection with the list or
stocks on that list shall be an unlawful representation.
Section 220.18—Supplement to Regulation T
Margin
Requirements
The required margin for e a c h security position held in
a margin account shall be as follows:
is traded, provided that all such rules have b e e n
approved or a m e n d e d by the S E C .
(i) Short put or short call on a stock index-. The
amount or other security positions specified by the
rules of the national securities e x c h a n g e on which the
option is traded, provided that all such rules have b e e n
approved or a m e n d e d by the S E C .
BANK
ORDERS
(a) Margin security except for (b) below: 50 per cent of
the current market value of the security.
(b) Exempted
security,
registered
debt security or OTC margin bond:
quired by the creditor in g o o d faith.
non-convertible
the margin re-
(c) Short put or short call on an equity security: 30 per
cent of the current market value of the underlying
security, but not less than $250, adjusted or w a i v e d in
accordance with section 220.5(c).
(d) Short sale of nonexempted
security: 150 per cent
of the current market value of the security or 100 per
cent of the current market value if a security exchangeable or convertible within 90 calendar days
without restriction other than the payment of m o n e y
into the security sold short is held in the account.
(e) Short sale of an exempted security: 100 per cent of
the current market value of the security plus the
margin required by the creditor in g o o d faith.
(f) Nonmargin,
nonexempted
security or a long position in any option: 100 per cent of the current market
value.
(g) Short put or short call on an exempted
debt
security or certificate of
deposit:
(1) The amount or other position specified by the
rules of the national securities exchange on which
the option is traded, provided that all such rules
have b e e n approved or a m e n d e d by the S E C ; or
(2) in the c a s e of an over-the-counter option on an
e x e m p t e d debt security that the S E C has not determined to be an e x e m p t e d security, an amount or
other position w h i c h the creditor in g o o d faith
d e e m s to be equivalent to the margin or c o v e r on
comparable exchange-traded options.
(h) Short put or short call (securities exchange
traded)
on foreign currency: The amount, other option position, or foreign currency position specified by the rules
of the national securities e x c h a n g e on which the option
HOLDING
ISSUED
COMPANY
AND BANK
BY THE BOARD
OF
MERGER
GOVERNORS
Orders Under Section 3 of Bank Holding
Company Act
Augustana College Association,
Sioux Falls, South Dakota
Order Approving
Company
Formation
of a Bank
Holding
Augustana College A s s o c i a t i o n , Sioux Falls, South
Dakota, has applied for the Board's approval under
section 3(a)(1) of the Bank Holding Company A c t
(12 U . S . C . § 1842(a)(1)) to b e c o m e a bank holding
c o m p a n y through the acquisition of at least 87.4 percent of State Bank of Hendricks, Hendricks, Minnesota ( " B a n k " ) .
N o t i c e of the application, affording opportunity for
interested persons to submit c o m m e n t , has b e e n given
in accordance with section 3(b) of the Act. The time
for filing c o m m e n t s and v i e w s has expired, and the
Board has considered the application and all comments received, including the c o m m e n t s of the Minnesota C o m m i s s i o n e r of B a n k s , in light of the factors set
forth in section 3(c) of the A c t .
Applicant is a nonprofit, tax-exempt corporation
under section 501(c)(3) of the Internal R e v e n u e Code
that operates a four-year liberal arts college offering
undergraduate degrees in 40 major fields of study.
Although generally an institution that engages in nonbanking activities is prohibited from b e c o m i n g a bank
holding c o m p a n y under the A c t , the legislative history
of the 1966 A m e n d m e n t s to the Act indicates that
Congress intended to permit nonprofit, tax-exempt
institutions that were engaged in exclusively religious,
charitable, or educational activities to o w n banks
subject to the A c t ' s provisions. 1 The legislative history
indicates that the e x c l u s i v e l y religious, charitable, or
educational activities of such institutions w e r e not
1. S. Rep. No. 1179, 89th Cong., 2d Sess. 3 (1966). Based on the
legislative history, the Board has previously determined that the Act
permits an institution engaged in exclusively charitable activities to
become a bank holding company. The Retirement Research Foundat i o n , 64 FEDERAL RESERVE BULLETIN 891 (1978).
Legal Developments
intended to be regarded as "activities" for purposes of
the prohibitions of section 4 of the Act. Accordingly,
approval of the application is not barred due to Applicant's educational activities.
Applicant engages in a number of profit making
activities related to its educational functions, including
the operation of dormitories and recreational facilities,
a food service and cafeteria facilities, a student bookstore, a health service, and other activities of the type
generally engaged in by educational institutions. In
connection with its educational program, Applicant
also provides facilities and personnel for certain tax
exempt organizations engaged in educational, research, and community service activities. N o n e of
these activities produces independent business income
for purposes of the Internal Revenue Code, and the
Board believes that such activities may be regarded as
incidental to Applicant's educational activities.
Applicant also o w n s and administers an endowment
fund and a gift fund consisting primarily of short-term
investments which would be permissible for a bank
holding company to own, including stocks and bonds
representing less than 5 percent of the voting stock of
the issuer, real estate mortgages and notes. The income generated from these assets represents less than
3 percent of Applicant's total revenue and is not
regarded as independent business income under the
Internal Revenue Code. In connection with these
funds, Applicant also holds certain real estate received
as gifts which would not be permissible for a bank
holding company to hold. Applicant has made appropriate commitments for the divestiture of this real
estate and any other assets received in the future that
would be impermissible for a bank holding company to
own. Since the revenue derived from the funds is used
to fund Applicant's educational activities and since
such funds are common methods by which educational
institutions fund themselves, the Board believes that
the funds and Applicant's fundraising activities with
respect thereto may be regarded as incidental to
Applicant's educational activities.
Bank is the 612th largest banking organization in
Minnesota with total deposits of $3.4 million, representing .01 percent of total deposits in commercial
banks in the State. Bank ranks as the 16th largest
banking organization in the relevant banking market
with .94 percent of total market deposits. 3 Applicant
has no other banking subsidiaries and its principals are
not associated with any other banking organizations in
the relevant market. Accordingly, the Board concludes that competitive considerations are consistent
2. Banking data are as of December 31, 1981.
3. The relevant banking market is approximated by the counties of
Lincoln, Lyon, and Murray, the western two thirds of Yellow
Medicine County, and the western one-quarter of Redwood County,
South Dakota.
441
with approval.
The financial and managerial resources and future
prospects of Applicant and Bank are regarded as
satisfactory. Accordingly, considerations relating to
banking factors are consistent with approval. While no
major changes in Bank's services are contemplated,
considerations relating to the convenience and needs
of the community to be served also are consistent with
approval.
In its review of the application, the Board has taken
into consideration the views of the Minnesota Commissioner of Banks expressing concern regarding the
nature of Applicant's nonbanking activities. The
Board believes that the Commissioner's concerns are
resolved by Applicant's commitment to divest of impermissible real estate and other assets and by Applicant's conformance with the legislative history of the
1966 Amendments to the Act which indicates that
nonprofit, tax-exempt organizations engaged in exclusively religious, charitable, or educational activities
were not intended to be precluded from owning banks.
Accordingly, the Board has determined that consummation of the transaction would be consistent with
the public interest and that the application should be
approved. On the basis of the record, the application is
hereby approved for the reasons summarized above.
The transaction shall not be made before the thirtieth
calendar day following the effective date of this Order,
or later than three months 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
Minneapolis acting pursuant to delegated authority.
By order of the Board of Governors, effective
May 10, 1983.
Voting for this action: Vice Chairman Martin and Governors Partee, Teeters, Rice, and Gramley. Absent and not
voting: Chairman Volcker and Governor Wallich.
JAMES M C A F E E ,
[SEAL]
Associate
Secretary
of the
Board
Banco Nororiental de Venezuela,
C.A., Caracas. Venezuela
Corpofin, C.A.,
Caracas Venezuela
Corpofin, N.V.,
Netherlands Antilles
Order Approving
Acquisition
of a Bank
Banco Nororiental de Venezuela, C . A . , Caracas, Venezuela; Corpofin, C . A . , Caracas, Venezuela; and Cor-
442
Federal Reserve Bulletin • June 1983
pofin, N . V . , Netherlands Antilles, have applied for the
Board's approval under section 3(a)(1) of the Bank
Holding Company Act (12 U.S.C. § 1842) to become
bank holding companies through the acquisition of a
total of 72.18 percent of the voting shares of Peoples
Hialeah National Bank, Hialeah, Florida ("Bank").
Notice of these applications, affording the opportunity for interested persons to submit comments, has
been given in accordance with section 3(b) of the Act.
The time for filing comments and views has expired,
and the Board has considered the application and all
comments received in light of the factors set forth in
section 3(c) of the Act.
Banco Nororiental de Venezuela, which is a commercial bank organized under the laws of Venezuela in
July 1980, has assets totalling $147.8 million and
controls deposits totalling $94.6 million. 1 Corpofin,
C.A., and its subsidiary, Corpofin, N . V . , are nonoperating holding companies majority owned and controlled by the principal shareholders of Banco Nororiental de Venezuela. Banco Nororiental de Venezuela
owns 10 percent of the voting shares of Corpofin,
C.A., and of Corpofin, N . V . , and proposes to acquire
10 percent of the voting shar es of Bank. The remaining
62.18 percent of the shares of Bank will be acquired
directly by Corpofin, N . V .
Upon acquisition of Bank, Applicants would control
the 65th largest commercial banking organization in
the Miami-Fort Lauderdale banking market, 2 with
total deposits of $10.5 million, representing approximately 0.07 percent of the deposits in commercial
banks in the relevant market. 3 Inasmuch as Applicants
do not conduct any banking operations or other business in the United States, consummation of the proposed transaction would have no adverse effects on
existing or potential competition in any relevant market and would not increase the concentration of resources in any relevant market. Therefore, the Board
concludes that competitive considerations are consistent with approval of these applications.
The financial and managerial resources of each of
the Applicants and of Bank appear generally satisfactory and the future prospects of each appear favorable.
In this regard, Applicants have consented to make
their books and records available to the Board in the
United States subject to certain restrictions in Venezuelan law.
Based on this and other commitments offered by
Applicant and shareholders of Applicants, the Board
1. Banking data for Banco Nororiental de Venezuela is as of
December 31, 1982.
2. The Miami-Fort Lauderdale banking market comprises Dade and
Broward Counties, Florida.
3. All banking data for Bank are as of June 30, 1982.
has determined that considerations relating to banking
factors are consistant with approval of the applications. Although consummation of the proposal would
not result in any changes in the services offered by
Bank, considerations relating to the convenience and
needs of the community to be served are consistent
with approval of the applications. Accordingly, the
Board has determined that consummation of the transactions would be in the public interest and that the
applications should be approved.
Based upon the foregoing, including all of the facts
of record and the commitments made by Applicants
and shareholders of Applicants, the Board has determined that the applications should be and hereby are
approved. The transaction shall not be consummated
before the thirtieth day following the effective date of
this Order, or later than three months after the effective date of this Order, unless such period is extended
for good cause by the Board or by the Federal Reserve
Bank of Atlanta under delegated authority.
By order of the Board of Governors, effective
May 20, 1983.
Voting for this action: Vice Chairman Martin and Governors Wallich, Teeters, Rice, and Gramley. Absent and not
voting: Chairman Volcker and Governor Partee.
JAMES M C A F E E ,
[SEAL]
Associate
Secretary
of the
Board
Dakota Bankshares, Inc.,
Fargo, North Dakota
Order Denying
Acquisition
of a Bank
Dakota Bankshares, Inc., Fargo, North Dakota, a
bank holding company within the meaning of the Bank
Holding Company Act, has applied for the Board's
approval under section 3(a)(3) of the Act (12 U . S . C .
§ 1842(a)(3)) to acquire 80 percent of the outstanding
voting shares of Dakota Bank of Wahpeton, Wahpeton, North Dakota ("Bank"), a proposed de novo
bank. Applicant has also applied for Bank to become a
member of the Federal Reserve System.
Notice of the application, affording opportunity for
interested persons to submit comments and views, has
been given in accordance with section 3(b) of the Act.
The time for filing comments and views has expired,
and the Board has considered the application and all
comments received in light of the factors set forth in
section 3(c) of the Act (12 U . S . C . § 1842(c)).
Applicant is the fourth largest banking organization
in North Dakota, with deposits of $126.6 million.
Applicant controls three banking and two nonbanking
Legal Developments
subsidiaries and holds a 19.1 percent interest in a
fourth bank. Applicant controls 2.65 percent of the
total deposits in commercial banks in the state. 1 Applicant's acquisition of Bank would not initially increase
Applicant's deposit share since Bank is a proposed
de novo bank.
Bank would be located in the Wahpeton, North
Dakota-Breckenridge, Minnesota banking market, in
which Bank would be the smallest of twelve banks. 2
Applicant's principal controls three additional onebank holding companies, which had combined assets
of $58 million on December 31, 1982, and which,
together with Applicant, constitute a chain banking
organization. 3 Neither Applicant's banking subsidiaries nor any of the related chain banks currently
operate in the Wahpeton-Breckenridge market. Accordingly, the Board concludes that consummation of
the proposal would not result in any adverse effects
upon competition or increase the concentration of
banking resources in any relevant area. Competitive
considerations, therefore, are consistent with approval
of the application.
The Board has indicated on previous occasions that
a holding company should serve as a source of financial and managerial strength to its subsidiary bank(s),
and that the Board will closely examine the condition
of an applicant in each case with this consideration in
mind. In addition, where the principal of an applicant
controls other banking organizations, the Board considers the financial and managerial resources and
future prospects of the institutions comprising the
chain. 4
1. Banking data are as of September 30, 1982.
2. This market consists of Sargeant and Richland Counties in North
Dakota and the southern two-thirds of Wilkins County in Minnesota.
3. Applicant's principal is an officer and director of each one-bank
holding company as well as an officer and/or director of each
subsidiary bank of these holding companies. In addition, Applicant's
principal is the single largest shareholder of one of the three bank
holding companies and owns well in excess of 25 percent of the voting
shares of the other two. No other single shareholder owns a greater
interest in either of these two bank holding companies. Under both the
Bank Holding Company Act of 1956 (12 U.S.C. § 1842(a)(2)) and the
Change in Bank Control Act of 1978 (12 U.S.C. § 1817(j)(8)(B)), an
ownership interest of the magnitude held by Applicant's principal in
these bank holding companies would place Applicant's principal in
control of the holding companies. Based on these facts, the Board
concludes that Applicant and the three related one-bank holding
companies constitute a chain banking organization, which is controlled by Applicant's principal.
4. See Nebraska Banco, Inc., Ord, Nebraska (62 FEDERAL RESERVE BULLETIN 638 (1976)), where the Board stated that in analyzing
the financial and managerial resources of an applicant that is part of a
chain of one-bank holding companies the Board would look beyond
the applicant to the other banks that are part of that chain. The Board
concluded that this analysis was appropriate because of the "interdependence of the banks in a chain of commonly-owned one-bank
holding companies and the distinct possibility that the financial and
managerial resources of one or more of the banks in the chain may be
used to support the operations of other members of the banking
group." Id. at 639.
443
In this connection, the Board has considered Applicant's proposal in light of the Board's Capital Adequacy Guidelines 5 generally applicable to bank holding
companies and chain banking organizations with consolidated assets of over $150 million. 6 The Board's
guidelines for capital adequacy, particularly its standards for primary capital, reflect the Board's assessment as to the minimum appropriate capital levels for
banks and bank holding companies of various sizes.
Under the Guidelines, the primary and total capital
ratios of the chain banking organization of which
Applicant is a member are below the minimum levels
specified in the Guidelines and are less than satisfactory for community bank organizations of the combined size of the chain. 7 In this regard, in approving an
earlier banking acquisition by Applicant, the Board
advised Applicant of the Board's concerns regarding
the capital position of the chain banking organization
of which Applicant is a part and cautioned that their
future expansion would be evaluated on the basis of
the consolidated capital ratios for the chain banking
organization and the Board's capital adequacy guidelines for an organization with over $150 million in
consolidated assets. Based on the Guideline criteria
and other facts of record, the Board concludes that, in
the context of Applicant's proposal to expand further
its banking operations, the chain banking organization
is undercapitalized.
The Board also notes that Applicant itself does not
operate at, or above, the minimum primary capital
level for a community banking organization of its size.
Even if the Board accepts the accounting method
Applicant uses to calculate its consolidated capital,
Applicant's current capital position barely meets the
minimum acceptable level specified in the Guidelines.
In view of this fact and the recent decline in Applicant's capital position, the Board concludes that Applicant should improve its capital position in order that
Applicant may be in a position to serve as a source of
strength and to meet the financial needs of its existing
subsidiary banks.
5. Federal Reserve Board and Comptroller of the Currency Press
R e l e a s e , D e c e m b e r 17, 1981. 68 FEDERAL RESERVE BULLETIN 33
(1982), reprinted in Federal Reserve Regulatory Service, 113-1506. See
also "Definition of Bank Capital and Capital Adequacy Guidelines
Program" (SR82-17, dated March 17, 1982).
6. Applicant's total assets equal $169 million and the combined
banking assets of Applicant and the three related one-bank holding
companies equal approximately $227 million as of December 31, 1982.
7. The two principal measurements of capital contained in the
Guidelines are: (1) primary capital to total assets and (2) total capital
to total assets. Primary capital consists of common stock, perpetual
preferred stock, capital surplus, undivided profits, reserves for contingencies and other capital reserves, mandatory convertible instruments, and allowance for possible loan losses. Total capital includes
the primary capital components plus limited-life preferred stock and
qualifying subordinated notes and debentures.
444
Federal Reserve Bulletin • June 1983
While the Board has considered Applicant's submissions, which project an improved capital position over
time, those submissions do not address the Board's
concerns regarding the capital and financial resources
of Applicant and the chain with respect to the proposed expansion. Applicant has projected that,
through earnings retention, the combined consolidated
capital ratios of the chain banking organization will
increase over a five year period. Applicant has not,
however, provided a specific capital augmentation
program responsive to the capital deficiencies raised
by this proposal. Applicant's projections are uncertain
and provide no assurance that the chain organization's
capital will be raised to a satisfactory level.
Without an adequate plan to improve the capital of
Applicant and of the chain, the Board is concerned
that the financial consequences associated with the
high debt level of this proposal presents an additional
adverse financial factor. Applicant proposes to acquire
80 percent of Bank's shares for $800,000 8 and to
borrow $500,000 to finance this purchase. The use of
this acquisition debt would further increase Applicant's high debt level, thereby reducing its financial
flexibility and its ability to serve as a source of
strength to Bank and Applicant's other subsidiary
banks.
The Board concludes that the banking considerations involved in this proposal present adverse factors bearing upon the financial resources and future
prospects of Applicant and the chain banking organization of which it is a significant part. Such adverse
factors are not outweighed by any procompetitive
effects or by any benefits that may result in better
serving the convenience and needs of the community.
Accordingly, the Board's judgment is that approval of
the application would not be in the public interest and
the application to acquire bank should be denied.
With respect to considerations relating to the convenience and needs of the community to be served, the
banking services to be offered by Bank would not
differ substantially from those already available in the
Wahpeton-Breckenridge market, although consummation of the proposal would result in an additional
choice of banking facilities for area residents. These
factors are consistent with, but lend no significant
weight toward approval of this application. Finally,
inasmuch as Applicant has stated that it would not
open Bank without approval of the related application
to acquire Bank, it is unnecessary at this time for the
Board to act on Bank's application to become a
member of the Federal Reserve System.
Ellis Banking Corporation, Bradenton, Florida, a bank
holding company within the meaning of the Bank
Holding Company Act, has applied for the Board's
approval under section 3(a)(3) of the Act (12 U . S . C .
§ 1842(a)(3)) to acquire 100 percent of the voting
shares of Dixie County State Bank, Cross City, Florida ("Bank").
Notice of the application, affording an opportunity
for interested persons to submit comments and views,
has been given in accordance with section 3(b) of the
Act. The time for filing comments and views has
expired and the Board has considered the application
and all comments received in light of the factors set
forth in section 3(c) of the Act (12 U . S . C . § 1842(c)).
Applicant, the eighth largest banking organization in
Florida, controls 18 banks with aggregate deposits of
approximately $1.1 billion, representing approximately 2.8 percent of total deposits in commercial banks in
the state. 1 Bank, with deposits of $18.6 million, is the
371st largest commercial bank in Florida, holding less
than 0.1 percent of total deposits in commercial banks
in the state. Acquisition of Bank would have no
appreciable effect upon the concentration of banking
resources in Florida. Bank is the only bank competing
in the Dixie County banking market. 2 Because Applicant does not currently operate in this market, consummation of the proposed transaction will not eliminate any existing competition. The Board concludes
that consummation of the proposal would not eliminate substantial probable future competition in the
market because of the large number of potential entrants into the market and other facts of record.
Accordingly, the Board concludes that competitive
8. The remaining shares will be acquired by local individual investors.
1. All banking data are as of June 30, 1982.
2. The Dixie County banking market includes all of Dixie County,
Florida.
On the basis of the facts of record, the application to
acquire Bank is denied for the reasons summarized
above.
By order of the Board of Governors, effective
May 3, 1983.
Voting for this action: Governors Martin, Wallich, Partee,
and Rice. Absent and not voting: Chairman Volcker and
Governors Teeters and Gramley.
JAMES M C A F E E ,
[SEAL]
Associate
Secretary
of the
Board
Ellis Banking Corporation,
Bradenton, Florida
Order Approving
Acquisition
of Bank
Legal Developments
considerations are consistent with approval of the
application.
The financial and managerial resources of Applicant, its subsidiaries and Bank are regarded as generally satisfactory and their future prospects appear favorable. The Board has indicated on previous occasions
that a holding company should serve as a source of
financial and managerial strength to its subsidiary
bank(s), and that the Board would examine closely the
condition of an applicant in each case with this consideration in mind. In this case, the Board concludes that
although the proposal would entail the use of acquisition debt, the amount of debt involved in this proposal
would not preclude Applicant from serving as a source
of strength to its subsidiary banks. Thus, considerations relating to banking factors are consistent with
approval of the application. Considerations relating to
the convenience and needs of the community to be
served also are consistent with approval. Accordingly,
it is the Board's judgment that consummation of the
proposal to acquire Bank would be in the public
interest and that the application should be approved.
On the basis of the record, the application is approved for the reasons summarized above. The acquisition of shares of Bank shall not be made before the
thirtieth calendar day following the effective date of
this Order or later than three months after that date,
unless such period is extended for good cause by the
Board of Governors or by the Federal Reserve Bank of
Atlanta, pursuant to delegated authority.
By order of the Board of Governors, effective
May 10, 1983.
Voting for this action: Vice Chairman Martin and Governors Partee, Teeters, Rice, and Gramley. Absent and not
voting: Chairman Volcker and Governor Wallich.
JAMES M C A F E E ,
[SEAL]
Associate
Secretary
of the
Board
445
the transaction, Fidelcor would acquire Bancshares'
subsidiary bank, Southeast National Bank of Pennsylvania, Malvern, Pennsylvania, ("Southeast Bank").
Notice of the application, affording an opportunity
for interested persons to submit comments, has been
given in accordance with section 3(b) of the Act. 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 Act (12 U . S . C . § 1842(c)). 1 Applicant, the seventh
largest commercial banking organization in Pennsylvania, controls one bank, The Fidelity Bank ("Fidelity"), with aggregate deposits of $2.4 billion, representing 3.3 percent of the total deposits in commercial
banks in the state. 2 Bancshares, the sixteenth largest
commercial banking organization in Pennsylvania,
controls one subsidiary bank with aggregate deposits
of $672 million, representing 0.9 percent of the total
deposits in commercial banks in the state. Upon
consummation of the proposal Applicant would become the fourth largest commercial banking organization in the state, controlling 4.2 percent of the total
deposits in commercial banks in the state. In addition,
the share of commercial bank deposits held by the four
largest banking organizations in the state would increase from 36.4 percent to only 36.8 percent, and
Pennsylvania would remain one of the least concentrated states in the United States. Accordingly, the
merger of Applicant and Bancshares would not have
any significant effect on the concentration of banking
resources in Pennsylvania.
Both Fidelity and Southeast Bank operate exclusively in the Philadelphia banking market. 3 Fifty-six
commercial banks operate 967 offices throughout the
market, and the share of commercial banking deposits
held by the four largest banking organizations in the
market is 45.3 percent. The Herfindahl-Hirschman
Index ( " H H I " ) in the Philadelphia market is 762.
Fidelity is the fifth largest commercial banking organization in the Philadelphia market, controlling 8.5 percent of the total deposits in commercial banks in the
Fidelcor, Inc.,
Rosemont, Pennsylvania
Order Approving
Companies
Merger
of Bank
Holding
Fidelcor, Inc., Rosemont, Pennsylvania, a bank holding company within the meaning of the Bank Holding
Company Act of 1956, as amended (12 U . S . C . § 1841
et seq.), has applied for the Board's approval under
section 3(a)(5) of the Act (12 U . S . C . § 1842(a)(5)) to
merge with Southeast National Bancshares of Pennsylvania, Inc., Malvern, Pennsylvania
("Bancshares"), also a bank holding company. A s a result of
1. This application was protested by the Philadelphia Council of
Neighborhood Organizations (PCNO) which alleged violations of the
Community Reinvestment Act. Specifically, PCNO asserted that
Applicant's banking subsidiary, The Fidelity Bank, did not adequately
meet the credit needs of low income residents and small businesses in
its service area and that the bank engaged in discriminatory mortgage
lending practices. Applicant and PCNO had several meetings to
discuss PCNO's allegations and, after the parties reached a formal
agreement, PCNO withdrew its protest.
2. Unless otherwise indicated, all banking data are as of December 31, 1982.
3. The Philadelphia banking market is approximated by the Philadelphia SMSA, which is comprised of Philadelphia, Montgomery,
Bucks, Chester, and Delaware counties, Pennsylvania; and Camden,
Burlington, and Glouster counties, New Jersey.
446
Federal Reserve Bulletin • June 1983
market. Southeast is the tenth largest commercial
banking organization in the market, controlling 2.8
percent of the total deposits in commercial banks in
the market. 4 Upon consummation of the proposal,
Applicant would become the third largest commercial
banking organization in the market and control 11.3
percent of the total deposits in commercial banks in
the market. The four-firm concentration ratio and the
HHI in the market would increase to 47.7 percent and
810 respectively. 5
Although the merger would eliminate some existing
competition between Applicant and Bancshares in the
Philadelphia banking market, the Board does not believe that the effect of this transaction on existing
competition would be significant. The Philadelphia
banking market is unconcentrated and numerous
banking alternatives would remain in the market upon
consummation. In addition, the Philadelphia banking
market contains 125 thrift institutions that control
deposits of $20.2 billion representing 49.3 percent of
the total deposits in the market. The Board believes
that thrift institutions exert a considerable competitive
influence in this market as they are providers of N O W
accounts, other transaction accounts, and consumer
loans. In addition, thrift institutions in this market
have the power to and are in fact engaged in the
business of making commercial loans and provide an
alternative for such services for customers in the
Philadelphia banking market. 6 Thus, the Board has
considered the presence of thrift institutions in the
Philadelphia market in assessing the competitive effects of this transaction and concludes that competitive considerations are consistent with approval of the
transaction.
The Board has also considered the effect on existing
and potential competition in the nonbanking activities
in which Applicant and Bancshares engage. Applicant,
through its subsidiary, Latimer and Buck, Inc.
( " L & B " ) , originates and services commercial and
residential mortgages. Southeast Bank also engages in
these activities and holds small market shares of each
product. These product lines, however, are characterized by numerous competitors and, therefore, the
combination of L&B and Southeast Bank will have
virtually no impact upon the competitive structure in
4. Market data are as of June 30, 1981 and include mergers and
acquisitions approved as of April 1983.
5. Under the Department of Justice merger guidelines, a market
with a post-merger HHI below 1,000 is considered unconcentrated
and the Department is unlikely to challenge mergers in such markets.
6. Under provisions of the recently enacted Garn-St Germain
Depository Institutions Act of 1982 the commercial lending powers of
federal thrift institutions have been significantly expanded. Title III 96
Stat. 1469, 1499-1500.
any relevant market. The effect of this transaction on
probable future competition would not be significant
since L&B already operates in the geographic markets
served by Southeast Bank, and the Bank, because of
its limited resources, does not appear to be a probable
future entrant into the geographic markets served by
L&B.
Both Applicant, through Fidelcor Mortgage Corporation, and Southeast Bank engage in consumer finance activities. Applicant, however, operates in the
southern United States while Southeast Bank operates
primarily in the Philadelphia region. Thus, this transaction would have no effect on existing competition in
this line of commerce. Any effect on probable future
competition resulting from this merger would be insignificant in light of the numerous probable future entrants and the ease of entry into this line of commerce.
The financial and managerial resources of Applicant, Bancshares and their respective subsidiaries are
considered generally satisfactory, and banking factors
are therefore consistent with approval of this application. Although there is no indication that the convenience and needs of the community are not being met,
consummation of the proposal will produce certain
benefits to the communities served, including an increase in Fidelity's and Southeast Bank's lending
limits. Also, Southeast Bank will begin to offer international services (financing and foreign exchanges),
asset-based lending, and an educational loan program.
In addition, both subsidiary banks have satisfactory
records of meeting the credit needs of their communities under the Community Reinvestment Act. Thus,
considerations relating to the convenience and needs
of the community to be served are consistent with
approval.
Based on the foregoing and other facts of record, the
Board has determined that the application under section 3 of the Act should be and is hereby approved.
The merger shall not be made before the thirtieth
calendar day following the effective date of this Order,
and shall not be made 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 Philadelphia, pursuant to
delegated authority.
By order of the Board of Governors, effective
May 17, 1983.
Voting for this action: Chairman Volcker and Governors
Wallich, Partee, Teeters, Rice, and Gramley. Absent and not
voting: Governor Martin.
JAMES M C A F E E ,
[SEAL]
Associate
Secretary
of the
Board
Legal Developments
Orders Under Section 4 of Bank Holding
Company Act
Commerce Bancshares, Inc.,
Kansas City, Missouri
Order Approving
Insurance
Agency
Activities
Commerce Bancshares, Inc., Kansas City, Missouri, a
bank holding company within the meaning of the Bank
Holding Company Act ("Act"), has applied pursuant
to section 4(c)(8) of the Act (12 U . S . C . § 1843(c)(8))
and section 225.4(b)(1) of the Board's Regulation Y
(12 C.F.R. § 225.4(b)(1)), for permission to engage
de novo, through its subsidiary, Commerce Property
and Casualty Agency, Inc. ( " A g e n c y " ) , in the sale of
property and casualty insurance directly related to
extensions of credit by Applicant's bank and nonbank
subsidiaries and insurance directly related to the provision of other financial services by Applicant's subsidiaries. Such nonbank activities have been determined by the Board to be closely related to banking
and therefore permissible for bank holding companies.
(12 C.F.R. § 225.4(a)(9)). 1
Notice of the application, affording opportunity for
interested persons to submit comments and views on
the public interest factors, has been duly published. 2
The Independent Insurance Agents of America, Inc.,
and the Independent Insurance Agents of Missouri,
Inc. (collectively "Protestants") submitted comments
in opposition to the application and requested the
Board to order a formal hearing on the proposal. On
January 12,1982, the Board issued an order scheduling
a formal public administrative hearing to determine
whether consummation of the subject proposal could
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. The Board
stated that the United States Court of Appeals for the
Eighth Circuit had recently vacated a Board order
approving an application by Mercantile Bancorporation, Inc., St. Louis, Missouri ("Mercantile") to engage in property and casualty insurance and remanded
the case for an evidentiary hearing. 3 The Board stated
that the Mercantile application, which was also object-
1. Because it was pending on May 1, 1982, this application is not
subject to the prohibitions of the Garn-St Germain Depository Institutions Act of 1982, Pub. L. No. 97-320, § 601(D), 96 Stat. 1537 (1982).
2. 46 Federal Register 48761 (1981).
3. Independent Insurance Agents of America, Inc. v. Board of
Governors, 658 F.2d 571, reh. denied, 666 F.2d 177 (1981)
("Mercantile").
447
ed to by Protestants, involved allegations similar to
those raised by Protestants with respect to this application. 4
A formal public hearing, conducted in accordance
with the Board's Rules of Practice for Hearings
(12 C.F.R. Part 263) was held in St. Louis, Missouri,
on June 1-8, 1982, before an Administrative Law
Judge appointed at the Board's request. A substantial
record on the application was developed through submission of exhibits and testimony and participation of
Applicant, Protestants, and counsel for the Board.
In his Recommended Decision dated January 12,
1983, Administrative Law Judge Max O. Regensteiner
concluded, based upon evidence of record, that, subject to certain conditions, Applicant's proposal was
likely to result in public benefits and was not likely to
result in adverse effects and, accordingly, recommended that the Board approve the application. Protestants
timely filed exceptions to the Administrative Law
Judge's Recommended Decision.
Having carefully considered the entire record of the
proceeding, including the comments received, and the
transcript, exhibits, written testimony, rulings, and
briefs filed in connection with the hearing, and the
Recommended Decision filed by the Administrative
Law Judge, together with the exceptions thereto, the
Board has determined that the Administrative Law
Judge's findings of fact, conclusions of law, and recommendations, as modified and supplemented herein,
are fully supported by the evidence of record and
should be adopted as the findings and conclusions of
the Board.
Applicant is the third largest banking organization in
Missouri, with aggregate deposits of over $2 billion.
Agency would engage de novo in the sale as agent or
broker of property and casualty insurance in connection with extensions of credit by Applicant's subsidiary banks. 5 Such insurance would include casualty
insurance to protect any property used as collateral in
which Applicant's subsidiaries have a security interest
as a result of an extension of credit, and liability
insurance that as a general practice is written in
conjunction with insurance protecting collateral in
which Applicant's subsidiaries have a security interest
as a result of an extension of credit. Agency's activi-
4. In the interests of economy, the hearings on these two applications were partially consolidated. The court in Mercantile directed a
hearing on the following issues: (a) the precise manner in which
de novo entry was to be effected; (b) the general cost of insurance to
be issued; (c) potential conflicts of interest; (d) the potential for tying
(either coercive or voluntary); and (e) the competitive impact of the
proposal. 658 F.2d at 576.
5. The application also encompassed the sale of similar insurance
related to extensions of credit by applicant's two nonbank subsidiaries, insurance directly related to "the provision of other financial services" by Applicant's subsidiaries, and certain safekeeping
insurance.
448
Federal Reserve Bulletin • June 1983
ties would be conducted from a central office located
at Applicant's headquarters in Kansas City. Under
Applicant's proposal, insurance would be sold on bank
premises by employees of the subsidiary banks, w h o
will be licensed insurance agents.
Section 4(c)(8) of the Act provides that the Board
may approve a bank holding company's application to
engage in a nonbanking activity only after the Board
has determined that the proposed activity is so closely
related to banking as to be a proper incident thereto.
The Board has determined by regulation that the sale,
as agent, of credit-related insurance and the sale of
insurance related to the provision of other financial
services are permissible nonbank activities. 6 This determination was affirmed on judicial review in Alabama Association
of Insurance Agents v. Board of
Governors.7
To approve an application under section 4(c)(8) of
the Act, the Board must also determine that the
performance of the proposed activities by a nonbank
subsidiary of a bank holding company 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.
Public Benefits
and Adverse
Effects
Consistency with State and Federal Banking Law
Protestants assert that neither national banks nor
banks chartered under Missouri law are expressly
authorized to act as agents in selling credit property
and casualty insurance and that therefore Applicant's
subsidiary banks are prohibited from engaging in the
proposed insurance agency activities. 8 H o w e v e r ,
these laws relied on by Protestants govern the powers
of banks and do not by their terms prohibit the
acquisition by a bank holding company of a nonbank
subsidiary engaged in selling credit-related insurance.
At least one court has held, however, that the Board's
determination whether public benefits may be expected from a particular proposal to engage in insurance
activities depends on whether applicable laws may
restrict or limit the manner in which the applicant
conducts the proposed services. 9 The rationale of this
6. 12 C.F.R. § 225.4(a)(9).
7. 533 F.2d 224 (5th Cir. 1976), modified on rehearing, 558 F.2d 729
(1977), cert, denied, 435 U.S. 904 (1978).
8. Applicant has both national and Missouri-chartered subsidiary
banks.
9. Florida Ass'n. of Ins. Agents v. Board of Governors, 591 F.2d
334, 338-40 (5th Cir. 1979).
decision suggests that, in assessing the public benefits
claimed by Applicant, the Board must determine if
laws cited by Protestants might restrict the manner in
which Applicant contemplates carrying out the proposed activities and thus affect the likelihood of expected public benefits or adverse effects.
The laws governing the powers of national and
Missouri banks would not affect this proposal unless
Applicant's subsidiary banks are, to some extent at
least, themselves engaged in the activity proposed by
Applicant. With respect to Applicant's Missouri-chartered banks, it is unnecessary for the Board to consider this question because, even if these banks are
viewed as engaged in selling credit property and
casualty insurance, it seems reasonably clear that they
are permitted to do so under Missouri law. In resolving
issues of state law, the Board considers the relevant
statute itself, any judicial interpretations of that law
and, in the absence of judicial construction, opinions
of the relevant state administrator. There is no Missouri statute or court opinion directly pertaining to this
issue, but, at the Administrative Law Judge's request,
the state Commissioner of Finance submitted an opinion on this issue, stating that Missouri banks are
authorized to provide the type of credit-related insurance proposed by Applicant based on, among other
things, a 1981 statute permitting a state bank to
exercise all powers "necessary, proper and convenient" to effect any or all of the purposes for which it
was formed. 1 0 The Board does not believe that the
Commissioner's opinion is unreasonable or plainly
erroneous. It is not unreasonable to view selling
property and casualty insurance to protect the collateral the bank has taken on an extension of credit as
necessary and convenient to the making of the loan,
because property and casualty coverage of the collateral is a prerequisite in many cases to the making of a
secured loan. 11
Protestants argue that if the Missouri legislature had
intended to permit banks to sell credit property and
casualty insurance, it would have said so expressly.
The very purpose of an incidental powers clause,
however, is to avoid the necessity of enumerating
specific activities. Moreover, contrary to Protestants'
claim, the Commissioner's interpretation of the scope
of necessary incidental powers does not blur the
distinction between a state bank and a state trust
company, which may serve as an insurance broker
generally, 12 because a bank may only sell property
and casualty insurance directly related to an extension
of credit by the bank, while trust company insurance
10. Mo. Ann. Stat. § 362.106(1).
11. See Alabama Ass'n. of Ins. Agents v. Board of Governors, 533
F.2d at 244.
12. Mo. Ann. Stat. § 362.105.2(7).
Legal Developments
agency activities are under no such limitation. In their
arguments on the expected convenience aspects of this
proposal, Protestants recognize that the limitation to
credit-related insurance differentiates that activity
from general insurance agency functions. 1 3
With respect to national banks, the law regarding
credit-related property and casualty insurance is less
clear. The only court opinion on the sale by national
banks of such insurance ruled that the activity is not
authorized. 14 In a letter to the Administrative Law
Judge, the Comptroller's staff stated that this decision
was incorrect because, among other things, it has now
been recognized that national banks may sell credit life
insurance as a permissible incidental activity and that
credit property and casualty coverage may also reasonably be viewed as an appropriate incidental activity. This staff opinion has not yet been adopted by any
court, creating uncertainty as to whether Applicant's
subsidiary national banks, if deemed to be engaged to
some extent in the proposed activity, may do so under
the National Bank Act.
Accordingly, the Administrative Law Judge recommended that the application be approved on the condition that employees of Applicant's national bank subsidiaries enter into employment contracts with Agency
providing for the payment by the holding company of a
regular salary to those employees and permitting
Agency to control the employees' selling of credit
property and casualty insurance. The Board adopts
this condition recommended by the Administrative
Law Judge in order to eliminate any legal uncertainty
concerning whether the proposed activities will be
carried out in the manner planned by Applicant. In the
Board's view, such a condition would give the holding
company sufficient control over the conduct of the
selling of insurance that the activity would not be
viewed as an activity of the bank. 15
13. The Commissioner also found authority to sell credit property
and casualty insurance implicit in a Missouri bank's statutory authority to make loans. Mo. Ann. Stat. § 362.105.1(1). Protestants point to a
1936 opinion of the Missouri Attorney General interpreting the lending
and other powers of state banks and concluding that the lack of
express authorization precludes a state bank from selling any insurance. However, the fact that for eight years state banks have been
permitted by the Commissioner to sell credit life insurance suggests
that the rationale of the Attorney General's opinion is no longer
adhered to.
14. Saxon v. Georgia Ass'n. of Independent Ins. Agents, 399 F.2d
1010 (5th Cir. 1968). The court reasoned that since a national bank is
expressly permitted to act as an agent for life, fire, and other types of
insurance coverage in a town with a population of less than 5,000, the
bank is prohibited from offering insurance in towns with a greater
population. Virtually all of Applicant's national bank subsidiaries are
located in towns with a population in excess of 5,000.
15. Grandview Bank & Trust Co. v. Board of Governors, 550 F.2d
417, 429 (8th Cir.), cert, denied, 434 U.S. 821 (1977) (holding that as a
general matter, the separate corporate entities of companies in a bank
holding company system should be respected, unless the corporate
entities are operated in a unitary fashion or there is "fraud or a
complete subterfuge").
449
Contrary to Protestants' claims, the Board, as evidenced by its consistent and longstanding practice, has
the authority to impose conditions on its approval of a
proposal under section 4(c)(8) to eliminate from the
proposal grounds that would justify denial of the
application. In any event, Applicant has not objected
to the imposition of the condition requiring employment contracts, nor have Protestants identified any
particular disputed facts relating to the operation of
this condition that would necessitate an evidentiary
hearing on this point.
Expected Public Benefits
Increased Competition.
Approval of Applicant's proposal will add one new competitor with at least 38
offices in the state of Missouri. Congress expressly
authorized the Board to differentiate, in connection
with a bank holding company's application to engage
in nonbanking activities, between de novo entry into a
field and acquisition of a going concern. 1 6 Because
de novo expansion provides an additional source of
competition, the Board and the courts view such
expansion as being procompetitive in the absence of
evidence to the contrary. 17
In its ruling on the Mercantile order, the court of
appeals found that the Board may not automatically
approve all de novo acquisitions and directed the
Board to hold an evidentiary hearing on the precise
manner in which de n o v o entry is to be accomplished
as well as other possible adverse effects. 1 8 Because the
hearing on this case has been held jointly with that on
the Mercantile application, the facts surrounding the
manner of Applicant's de novo entry into credit property and casualty insurance business also have been
examined. The record here demonstrates that approval of Applicant's proposal would result in the introduction of a competitor offering a more convenient service—the ability to obtain a loan and insurance at a
single location. According to the record, the attractiveness of "one-stop shopping" is likely to force
independent agents to improve their services in order
to compete with the new entrants. 19 In addition,
Applicant will offer certain insurance products, such
16. 12 U.S.C. § 1843(c)(8). The legislative history of the Act
demonstrates that Congress authorized this distinction because it
viewed de novo entry as beneficial to competition. S. Rep. No. 1084,
91st Cong., 2d sess. 15, 16 (1970).
17. BankAmerica Corporation (Decimus Corporation), 66 FEDERAL RESERVE BULLETIN 511 (1980); Citicorp (Person to Person), 65
FEDERAL RESERVE BULLETIN 507 (1979); U.N. Bancshares,
FEDERAL RESERVE BULLETIN 204 (1973); Alabama
Ass'n.
Inc., 59
of Ins.
Agents v. Board of Governors, 533 F.2d at 249.
18. 658 F.2d at 574-75.
19. Protestants' claim that this competition would be unfair is
discussed below.
450
Federal Reserve Bulletin • June 1983
as mobile home insurance, not currently offered in all
geographic markets. Finally, the record indicates that
other bank holding companies and other financial
institutions, including one of the largest holding companies in the state, 20 currently sell credit property and
casualty insurance. Approval of this proposal would
permit Applicant to offer a similar range of services as
these organizations and to compete even more effectively for banking customers. 2 1
Greater Convenience.
Applicant would place a licensed insurance agent at each office of its bank or
nonbank subsidiaries where insurance would be offered. The evidence shows that this arrangement
would provide increased convenience at least for those
loan customers w h o do not already have insurance
coverage that would automatically extend to the loan
collateral or could easily be extended to cover the
collateral. Such customers would be able to avoid an
additional visit with another agent (and the resulting
duplicative paperwork) and to deal with a single person knowledgeable about both aspects of the transaction.
Protestants allege that this increased convenience,
found by the Administrative Law Judge to be "self
evident," would be offset by alleged inconveniences
inherent in the proposed services. For example, Protestants point out that when the loan covering insured
collateral has been paid, Applicant could not renew
the insurance coverage on the collateral. Nor could
Applicant offer multi-car or "fleet" discounts if Applicant has not extended credit on all the insured's
vehicles. However, Applicant has obligated its agents
to advise customers of the limitation on the scope of
coverage Applicant offers. Thus, a customer w h o
chooses insurance offered by Applicant is likely to be
aware of any potential inconveniences and would
presumably not purchase the insurance if it were
seriously inconvenient. The Board believes that the
fact that a holding company either chooses not to offer
certain services, or is prevented by the Board's regulations from offering those services, does not represent
the kind of adverse effect with which section 4(c)(8) is
concerned, because the adverse effect asserted by
Protestants is completely avoidable from the borrow-
20. S e e First Union Bancorporation,
67 FEDERAL RESERVE BULLE-
TIN 515 (1981).
21. Applicant also offered evidence that its de novo entry would
have a beneficial effect on price competition. The Administrative Law
Judge found such evidence unpersuasive, particularly in light of
the fact that the cost of insurance coverage is usually determined by
the underwriter, not the agent. The Board makes no findings on any
compelling procompetitive effects due to increased price competition.
22. See Virginia National Bankshares, Inc., 66 FEDERAL RESERVE
BULLETIN 668, 671 (1980), a f f d sub nom., Independent Ins. Agents of
America, Inc. v. Board of Governors, 646 F.2d 868 (4th Cir. 1981)
("Virginia National").
er's perspective. 2 2 The Board considers the insurance
agency activities of holding companies to be an alternative to, rather than a replacement for, services
provided by independent insurance agents, and believes that insurance customers should be allowed to
choose between such alternatives. Protestants, on the
other hand, in effect assert that customers should be
denied this choice because Applicant cannot offer a
complete range of services. The Board finds this
contention to be without merit.
Protestants also assert that because Applicant's
agents would spend a relatively small part of their time
on insurance activities, the quality of their service to
the public would be lower than that provided by
independent agents. This contention is not supported
by the record. The employees of Applicant would
provide only a f e w types of insurance coverage, so it is
likely that they would develop expertise in those
limited fields. N o r does the record support a finding
that the quality of service provided by Applicant's
agents would be significantly less than the average
quality of services provided by independent agents.
Increased Efficiency. Applicant claims that efficiencies will be gained as a result of the proposal, resulting
primarily from economies of scale due to centralization of Applicant's operations. Because of a lack of
specific evidence to support these contentions, the
Administrative Law Judge found little likelihood of
increased efficiency as a result of this proposal. This
finding is reasonable and is adopted by the Board.
Lowest Practicable
Cost. Applicant has indicated that
it would offer insurance at the lowest practicable cost
to the customer. This intention reflects the statement
made by the Board in the preamble to the amendment
to Regulation Y adding insurance agency activities to
the list of permissible activities for bank holding
companies. The Board expressed its expectation that
. . . any holding company or subsidiary that acts as
an insurance agent on the basis of the new regulatory
provision will exercise a fiduciary responsibility—that
is by making its best effort to obtain the insurance at
the lowest practicable cost to the customer. 2 3
The Administrative L a w Judge found, based on
testimony that Applicant could not offer the lowest
premiums in the market but would attempt to offer
insurance as cheaply as possible, that Applicant would
comply with the Board's expectation on cost of insurance. Protestants challenge this finding, asserting that
Applicant has failed to submit any evidence as to the
relative cost of the insurance to be sold. These conten-
23. 36 Federal Register 15,525 (1971).
Legal Developments
tions appear in part to be based on a misunderstanding
of the nature of the Board's expectation concerning
the cost of credit insurance sold by bank holding
companies.
The Board has not had prior occasion to elaborate
on the meaning of its expectation that a bank holding
company would provide insurance at the lowest practicable cost. Based on a review of the issues raised in
the original rulemaking proceeding on insurance activities, the Board believes that its expectation that a
bank holding company selling insurance would be
under a fiduciary duty means that the holding company should serve as agent for the loan customer/
insured, not solely for itself or for the underwriter of
the insurance being sold. Thus, a holding company
should put aside its own interest in obtaining a commission and make a reasonably diligent effort to obtain
the insurance for the customer on the best possible
terms, including the lowest cost. 2 4 Since the fiduciary
duty to obtain insurance is limited by concerns of
practicability, however, the holding company should
also consider the quality of the services to be provided
in determining what constitutes the lowest cost.
In any event, it is clear that the Board does not
require an affirmative showing by a bank holding
company that the cost of the insurance it sells must be
reduced below the prevailing costs for the particular
type of coverage involved as a prerequisite for approval of an application. Where the Board has imposed a
requirement of reduced costs as a condition for engaging in a nonbanking activity, as it has done regarding
the underwriting of credit life insurance, the Board has
made this condition explicit in the terms of Regulation
Y itself. 25 The Board has in the past approved many
applications to sell credit-related insurance without
requiring a specific showing of a reduction in the cost
of the insurance to be sold. In the Alabama case, for
example, the court upheld the Board's determination
that particular applications to sell credit-related insurance, including property and casualty insurance, met
the net public benefits test of section 4(c)(8) without
any specific showing that the insurance would be
offered at a cost lower than insurance sold by competitors. 26 Some applicants have made a voluntary commitment to provide insurance to their customers at
below prevailing costs. Such a commitment has been
24. As a general rule, any insurance agent who obtains insurance on
behalf of an insured is under a fiduciary duty to the insured. E.g., Zejf
Dist. Co. v. Aetna Casualty & Surety Co., 389 S.W. 2d 789, 795 (Mo.
1965); Myers, Legal and Professional Responsibilities of Agents and
Brokers, in Property and Liability Insurance Handbook, 1028, 103435 (J. Long and D. Gregg eds. 1965).
25. 12 C.F.R. § 225.4(a)(10) ("The Board will only approve applications [to act as underwriter for credit life insurance] in which an
applicant demonstrates that approval will benefit the consumer . . .
[by] a projected reduction in rates . . . .").
26. 533 F.2d at 249. (The court noted only that there was evidence
of some pressure for lower prices).
451
considered a positive public benefit for purposes of the
section 4(c)(8) balancing test. On the other hand,
evidence that an applicant would not exercise reasonable diligence in obtaining insurance coverage at the
lowest practicable cost must be viewed as an adverse
effect that, when weighed against possible public benefits, might well require denial of such an application.
There is no evidence in the record that the cost of
the credit-related insurance sold by Applicant here
would necessarily be higher than the costs of comparable coverage sold by other agents or that Applicant's
agents would not make reasonable efforts to obtain the
types of coverage it c h o o s e s to sell on the best possible
terms, including the lowest cost. Applicant submitted
no specific evidence on the underwriters of the credit
insurance to be sold or on the relative costs of such
insurance, but reiterated that, judged in terms of costs
as well as services provided, Applicant would endeavor to provide insurance as cheaply as possible. In light
of this evidence the Board finds that cost considerations would not present any adverse effects but, in
the absence of any affirmative showing of reductions
of costs, would produce only slight public benefits. 2 7
In summary, the Board finds that this proposal is
likely to result in benefits to the public in the form of
increased competition and greater convenience.
Lack of Significant Adverse Effects
Decreased
Competition
or Undue Concentration
of
Resources.
Since Applicant would enter the credit
property and casualty insurance field de novo, this
proposal would not result in the elimination of any
existing or potential competition or in any undue
concentration of resources. Protestants allege that the
proposal will have a harmful effect on independent
insurance agents, pointing to evidence that because of
Applicant's size and statewide presence, Agency
would soon reach significant size in relation to the
typical independent agency. The fact that Applicant,
by offering lower prices or better services, may take
business away from some inefficient independent
agents does not in itself constitute decreased competition for purposes of section 4(c)(8) for, as the Board
has noted elsewhere, the antitrust laws are designed to
protect competition, not competitors. 2 8 In any event,
there is no persuasive evidence that Agency's size
alone will give it unwarranted market power, given the
27. In directing a hearing on the Mercantile proposal, the court of
appeals stated that the Board must consider general proposed insurance rates in reviewing the validity of Protestants' claims that
Mercantile's rates will be much higher than those offered by independent agents in the relevant markets. 658 F.2d at 576 n.7. Protestants
have not advanced such claims with respect to this application.
28. E.g., BankAmerica Corp (Decimus Corp.), 66 FEDERAL RESERVE B U L L E T I N a t 5 1 5 .
452
Federal Reserve Bulletin • June 1983
generally low barriers to entry into the industry and
the fact that, while independent agencies are free to
offer a full line of insurance, Agency may provide only
property and casualty insurance related to extensions
of credit by Applicant's subsidiaries. Moreover, as
pointed out above, approval of this application would
permit Applicant to compete with at least one other
statewide bank holding company that currently is
authorized to provide credit property and casualty
insurance, and to offset the potential dominance of
that company in this product submarket.
Unfair Competition—Voluntary
Tie-Ins. Protestants
allege that this proposal would result in the unfair tying
of insurance sales to extensions of credit. Section 106
of the B H C Act Amendments of 1970 2 9 makes it illegal
for a bank to require the purchase of some additional
service from the bank in order to obtain credit. By its
terms, section 106, which the Board has applied by
regulation to bank holding companies, 3 0 prohibits both
implicit and explicit conduct on the part of the lender
designed to convey the requirement that an additional
service must be purchased. Protestants have produced
no evidence that Applicant has not or will not comply
with this prohibition.
Protestants also allege that, apart from explicitly
coerced joint sales, the proposal would also produce
significant voluntary tying, which results when a customer believes that he or she stands a better chance of
obtaining a scarce product by purchasing another
product or service from the same seller. 31 As the
Board has consistently found, in accordance with
congressional and judicial teaching, the likelihood of
voluntary tying depends on the market power of the
seller and the scarcity of the product offered. The
possibility of voluntary tying is significantly reduced
where the relevant markets are competitive and the
number of alternative sources for the product (e.g.,
credit) is large. The record shows, as the Administrative Law Judge found, that there are at least several
and, in many cases, significant numbers of banks and
other lending institutions that serve as alternative
sources of credit in the relevant geographic markets in
which Applicant's subsidiary banks operate. Although
there is evidence of market concentration in a few
relevant markets, the banks involved represent such a
small portion of Applicant's operations that the poten-
tial for voluntary tying in the context of the proposal as
a whole is not significant.
In addition, Applicant has made a number of commitments designed to minimize the likelihood of voluntary tying. Applicant has committed that it would
advise its customers in writing that the customer may
choose insurance from any source, that Applicant's
agent/loan officers would not discuss credit insurance
with a prospective borrower until after the credit had
been granted, and that the agent would not be compensated based on the amount of insurance sold. 3 2 Protestants question the likelihood of compliance with these
commitments. H o w e v e r , the Board's practice of reliance on similar commitments has been approved by
the courts, 33 the Board p o s s e s s e s ample authority to
enforce such commitments, 3 4 and Protestants have
offered no specific evidence that such commitments
would not be observed.
Protestants challenge the Administrative Law
Judge's conclusions regarding evidence submitted by
Protestants relating generally to the unlikelihood of
tie-ins in bank sales of credit insurance. The Administrative Law Judge found some of this testimony quite
persuasive but concluded that the conclusions drawn
by Protestants from such testimony had already been
rejected by prior Board decisions. Protestants assert
the Judge erred in not considering the particular facts
in the record on this proposal, notwithstanding prior
Board determinations. In light of these objections, an
independent review of this evidence has been made,
and the Board concludes that the Administrative Law
Judge correctly determined that this record does not
show a substantial likelihood of voluntary tie-ins. The
evidence cited by Protestants, which consists of several economic studies prepared by Board staff and
others, and expert testimony that tie-ins were likely
because of the dominant power of the lender in a credit
transaction, is based primarily on economic theory
and on facts inherent in any sale of credit insurance by
a banking organization and does not relate to any
matter unique to Applicant's proposal. The Board has
considered and commented on this evidence or evidence very similar in the rulemaking proceeding on the
permissibility of credit insurance activities, in congressional hearings, and in many other applications under
the Act. For the reasons stated in the Board's testimony and its orders on these occasions, the Board does
29. 12 U.S.C. §§ 1971-78.
30. 12 C.F.R. § 225.4(c)(1). The statute also provides that a person
injured by an illegal tying arrangement may recover treble damages.
12 U.S.C. § 1975.
31. Voluntary ties (or implicitly coerced joint sales) are to be
distinguished from truly voluntary joint sales, which may create a
public benefit by reducing the inconvenience of searching for the
second product.
32. As explained above, the Board has conditioned approval of this
proposal on a requirement that agents employed by Applicant's
subsidiary national banks be compensated for their insurance activities by a salary from Agency. The Board expects this commitment to
extend to such salaries paid by Agency.
33. E.g., Virginia National, 646 F.2d at 869-70.
34. E.g., 12 U.S.C. § 1818(b)(1), (b)(3).
Legal Developments
not believe that such evidence demonstrates the likelihood of voluntary tying in the sale of credit insurance
by a banking organization, nor does the Board find
that its s t a f f s tie-in study (taking into account criticisms of that study) s h o w s substantial probability of
adverse tying arrangements. 3 5
Protestants point to evidence directly related to this
proposal, in particular the fact that, unlike other
insurance agency proposals, under Applicant's proposal the employee making the loan would also serve
as the agent selling the credit insurance in a number of
cases. A s the Administrative Law Judge found, however, any increased potential for tying resulting from
this arrangement would be offset by the structure of
the relevant markets and by Applicant's commitments, especially the commitment not to discuss insurance until after the loan has been approved.
The record also indicates that Applicant has
achieved significantly high penetration rates 36 in the
sale of credit-related life insurance, which is offered
directly by its subsidiary banks. However, penetration
rates alone do not necessarily demonstrate the extent
of implicitly coerced joint sales, and experience regarding the sale of credit life insurance is not necessarily indicative of practices in the sale of credit property
and casualty insurance since, unlike credit property
and casualty insurance, credit life insurance is offered
only by lenders, and is significantly less expensive
than credit property and casualty insurance.
Because of the existence of alternative sources and
the relatively high cost, borrowers are likely to feel
much less obligated to volunteer to purchase property
and casualty insurance through Applicant than to
purchase credit life insurance. Moreover, the sale of
credit life insurance by Applicant's banks does not
appear to be subject to the anti-tying commitments
made here with respect to the sale by Agency of credit
property and casualty coverage.
Nevertheless, the record indicates that Applicant
has aggressively encouraged the sale of credit life
insurance by its loan officers and has established a
program of recognition for bank officers w h o achieve
high penetration rates. The Administrative Law Judge
35. Much of this general evidence cited by Protestants relates to
other types of insurance, such as credit life and title insurance, that
differ in material respects from credit property and casualty coverage,
or relates to lenders, such as independent finance companies, that are
not subject to the comprehensive federal regulation applicable to
banking institutions. Moreover, the theoretical arguments concerning
the dominant position of a creditor in a loan transaction are countered
by accepted economic doctrine that such power is diluted by the
existence of other sources of credit. Finally, the Board has, in
testimony presented to Congress, explained why the criticisms of its
staff study do not undermine the conclusions reached by the study.
36. Penetration rate refers to the percentage of loan customers of a
particular lender who also purchase credit insurance from the lender
or its affiliate.
453
found that such promotional practices might enhance
the possibility of tying if followed in the sale of credit
property and casualty insurance. He recommended
that conditions be imposed that would prohibit internal
promotional activities designed to encourage Applicant's agents to sell property and casualty insurance,
such as special recognition programs for successful
agents, and that would require Applicant to provide
affirmative instruction in this regard to the concerned
personnel. The Board finds these conditions are reasonable and adopts them. Based on the facts of record,
and in light of commitments made by Applicant, the
Board finds that the possibility of tying does not
represent a serious adverse effect of this proposal. 3 7
Conflicts of Interest. Protestants also assert that the
proposal would result in serious conflicts of interest
because, for example, Applicant may encourage customers to finance insurance premiums rather than take
advantage of cheaper premium deferral plans or to
choose lower deductibles in order to obtain better
protection for the underlying collateral. Applicant, for
its part, states that it would offer premium deferral
plans if offered by the underwriters selected, would
not encourage the selection of low deductibles, and
would advise customers of the possibility of "fleet"
discounts under their existing policies if Applicant had
not extended credit on all of the customers' vehicles.
In addition, compensation of Applicant's agents would
not depend on the amount of insurance sold and
special rewards to employees for the sale of credit
property and casualty insurance would be prohibited
under the conditions imposed on approval of this
application.
Based on the record, the Board concludes that the
possibility of adverse effects resulting from conflicts of
interest as a result of the proposal is only slight. A s the
court in the Alabama case stated:
[cjontrary to the argument of the N A I A parties
[Protestants], the fact that a holding company's interest as a lender and as an insurer do not totally
converge does not require the conclusion that conflicts
of interest will occur. 3 8
37. Protestants' assertion that Applicant would engage in unfair
competition by requiring independent agencies to submit their customer lists in connection with loans from Applicant's subsidiaries to
such agencies does not appear realistic, since Applicant may sell
credit insurance only to its loan customers, a fact that may be
independently obtained from Applicant's own records. Nor does it
appear that a banking organization would obtain any unfair advantage
by having exclusive access to prospective customers for insurance at
the time they seek a loan and hence have most need of insurance
coverage. These same customers are very likely to have a relationship
with a non-bank-related agent for types of insurance, i.e., ordinary life
insurance, that a banking organization may not sell.
38. 533 F.2d at 252.
454
Federal Reserve Bulletin • June 1983
Protestants'
Procedural
Claims
Protestants object to the Administrative Law Judge's
rejection of Protestants' motion to strike the brief filed
by counsel representing the Board in this proceeding,
which Protestants assert was biased against them.
Since this motion was without merit, the Administrative Law Judge clearly did not abuse his discretion in
denying it. A review of the record indicates that Board
counsel did not unfairly carry Applicant's burden of
proof. 3 9 The Board's regulations governing formal
hearings do not prohibit Board counsel from taking a
position on the evidence adduced at a hearing, especially if, as here, the Board has already taken positions
on the legal ramifications of many of the facts involved. 4 0 The fact that such positions were adverse to
Protestants does not demonstrate unfair bias. Moreover, the lack of prejudice to Protestants is further
demonstrated by the fact that Protestants were able to,
and did, submit to the Administrative Law Judge and
the Board briefs pointing out in detail what Protestants
believed to be errors in the positions taken by Board
counsel. Protestants' claim that the Administrative
Law Judge was unduly influenced by Board counsel is
without merit. It is evident from the Recommended
Decision that the Administrative Law Judge conducted an independent review of the evidence and arguments and, indeed, did not accept Board counsel's
arguments on some points.
Protestants also request the opportunity to present
oral argument before the Board on this case. In the
Board's view, the numerous briefs and other submissions of the parties adequately explain the issues
involved and, accordingly, oral argument before the
Board at this time would serve no useful purpose.
Based upon all evidence and legal arguments presented by the parties, the Board finds that consummation
of this proposal, subject to the conditions imposed in
this Order, may not reasonably be expected to produce any significant undue concentration of resources,
decreased or unfair competition, conflicts of interests,
unsound banking practices or other adverse effects.
The Board further finds that public benefits in the form
of increased competition and greater convenience can
reasonably be expected to result from this proposal,
and that such public benefits are sufficient to outweigh
the slight possibility that adverse effects, such as
voluntary tying or conflicts of interest, might result
from this proposal.
39. Indeed, Board counsel's cross-examination of Applicant's witness demonstrated that the strength of its commitment on cost of
insurance sold was not what it appeared to be initially.
40. The Board's rules provide that Board counsel "shall represent
the Board in a nonadversary capacity for the purpose of developing
for the record information relevant to the issues to be determined by
the presiding officer and the Board." 12 C.F.R. § 263.6(d).
Based upon the foregoing and other considerations
reflected in the record, the Board has determined that
the balance of the public interest factors that the Board
is required to consider under section 4(c)(8) is favorable. Accordingly, the application is hereby approved,
subject to the conditions that (1) all employees of
Applicant's national bank subsidiaries engaged in selling credit property and casualty insurance enter into
employment contracts with Agency providing for the
payment of a regular salary by the holding company to
such employees and permitting Agency to control the
employees' sale of insurance; and that (2) neither
Applicant nor any of its subsidiaries undertake internal
promotional activities, including employee recognition
and similar programs, designed to encourage Applicant's agents to sell credit property and casualty
insurance, and that Applicant provide instruction to
such agents concerning this requirement. This determination is subject to the conditions set forth in
section 225.4(c) of Regulation Y and to the Board's
authority to require such modification or termination
of the activities of a holding company or any of its
subsidiaries as the Board finds necessary to assure
compliance with the provisions and purposes of the
Act and the Board's regulations and orders issued
thereunder or to prevent evasion thereof. The Board
has also relied on the commitments made by Applicant
with regard to this proposal and is prepared to ensure
compliance with those commitments.
The transaction shall be made not later than three
months after the effective date of this Order, unless
such period is extended for good cause by the Board or
by the Federal Reserve Bank of Kansas City, pursuant
to delegated authority.
By order of the Board of Governors, effective
May 31, 1983.
Voting for this action: Vice Chairman Martin and Governors Teeters, Rice, and Gramley. Absent and not voting:
Chairman Volcker and Governor Partee. Present and abstaining: Governor Wallich.
JAMES M C A F E E ,
[SEAL]
Associate
Secretary
of the
Board
Florida Coast Banks, Inc.,
Pompano Beach, Florida
Midlantic Banks, Inc.,
Edison, New Jersey
Order Approving the Opening of Additional
of Florida Coast Midlantic Trust Company,
Offices
NA.
Florida Coast Banks, Inc., Pompano Beach, Florida
("Florida Coast"), and Midlantic Banks, Inc., Edison,
Legal Developments
N e w Jersey ("Midlantic"), both bank holding companies within the meaning of the Bank Holding Company
Act ( " B H C Act") (12 U . S . C . § 1841 et seq.), have
applied for the Board's approval, under section 4(c)(8)
of the B H C Act (12 U . S . C . § 1843(c)(8)) and section
225.4(b) of the Board's Regulation Y (12 C.F.R.
§ 225.4(b)), to establish in Boca Raton and Palm
Beach, Florida, de n o v o offices of their joint venture
trust company, Florida Coast Midlantic Trust Company, N . A . , Lighthouse Point, Florida ("Trust Company"). The Board previously authorized Midlantic and
Florida Coast to establish Trust Company as a joint
venture. 1 Trust Company engages in functions or
activities that may be performed by a trust company.
Such activities have been found by the Board to be
closely related to banking (12 C.F.R. § 225.4(a)(4)).
Notice of the application, affording opportunity for
interested persons to submit comments and views has
been duly published. 48 Federal Register 11,511 and
16,540 (March 18 and April 18, 1983). The time for
filing comments and views has expired and the Board
has considered the application and all comments received in light of the factors set forth in section 4(c)(8)
of the B H C Act.
Midlantic controls seven banks with aggregate deposits of approximately $3.2 billion and is the second
largest bank holding company in N e w Jersey. 2
Through its nonbanking subsidiaries, Midlantic is engaged in the activities of mortgage banking, equipment
leasing, factoring, and holding overseas investments.
Midlantic also engages in the activity of providing trust
services through its subsidiary banks. Midlantic manages $1.4 billion in trust assets through its lead bank.
Florida Coast controls t w o banks with aggregate
deposits of approximately $358.9 million and is the
twentieth largest bank holding company in Florida.
Florida Coast also provides trust services through its
subsidiary banks.
Trust Company currently operates through one office, which is located in the Miami-Fort Lauderdale
banking market. 3 This proposal represents an expansion of Trust Company's operations into the eastern
Palm Beach County banking market. 4 Midlantic does
not provide trust services in eastern Palm Beach
County. H o w e v e r , Florida Coast engages in providing
full service trust and fiduciary services in eastern
Palm Beach County through its subsidiary, First Bank
1. Florida Coast Banks, Inc., and Midlantic Banks, Inc., 68 FEDERAL R E S E R V E B U L L E T I N 7 8 1 ( 1 9 8 2 ) .
2. Banking data for Midlantic and Florida Coast are as of June 30,
1982.
3. The Miami-Fort Lauderdale banking market consists of Dade
and Broward counties, Florida.
4. The eastern Palm Beach County banking market consists of the
eastern portions of Palm Beach County, Florida.
455
and Trust Company of Palm Beach County, Boynton
Beach, Florida ("First Bank"). Therefore, consummation of this proposal would eliminate some existing
competition between First Bank and Trust Company
in the market for trust services in the eastern Palm
Beach County banking market.
In this regard, Florida Coast and Midlantic have
stated that Trust Company would not seek directly or
indirectly referrals of trust customers from the retail
banking network or trust operations of First Bank. The
de novo offices would seek customers in eastern Palm
Beach County w h o do not have a banking or fiduciary
relationship with First Bank. Further, the market for
provision of trust services in eastern Palm Beach
County is not concentrated and there are numerous
other providers of trust services in that market. Based
on the foregoing, the Board concludes that consummation of this proposal would not have an adverse effect
on existing competition for trust services in the eastern
Palm Beach County banking market.
With regard to the effect of this proposal on probable future competition, the Board previously determined that Midlantic is not a likely independent entrant into the markets for trust services in Florida
served by Florida Coast and Florida Coast is not a
likely entrant into the N e w Jersey markets served by
Midlantic. 5 The Board also found that, since the
barriers to entry in the trust business are low, there are
numerous potential entrants in this market. The Board
has reviewed the facts and circumstances relating to
the instant applications in this regard and believes it is
appropriate to reaffirm its previous determinations.
Accordingly, the Board concludes that consummation
of this proposal would not adversely affect probable
future competition in any market.
Consummation of this proposal would provide a
new source of trust services at two locations in eastern
Palm Beach County. This proposal, therefore, may be
expected to increase competition for trust services in
eastern Palm Beach County and provide greater convenience to the communities served, as well as to
Midlantic's trust customers w h o move to Florida. In
addition, the combination of Midlantic's expertise in
the provision of trust services with Florida Coast's
knowledge of the relevant market is likely to result in
Trust Company's becoming capable of competing for
trust services with the large banking organizations in
the eastern Palm Beach County banking market.
There is no evidence in the record to indicate that
consummation of the proposal would result in undue
concentration of resources, decreased or unfair competition, conflicts of interests, unsound banking prac-
5. Florida Coast Banks, Inc., and Midlantic Banks, Inc., supra at
781, 782.
456
Federal Reserve Bulletin • June 1983
tices, or other adverse effects on the public interests. 6
Accordingly, the Board concludes that the balance of
public interest factors that it must consider under
section 4(c)(8) of the B H C Act favors approval. In
addition, financial and managerial resources and future prospects of Florida Coast, Midlantic and Trust
Company are considered consistent with approval of
the applications and the Board has determined that the
applications should be approved.
This determination is subject to the conditions set
forth in section 225.4(c) of Regulation Y and to the
Board's authority to require such modifications or
terminations of the activities of bank holding companies or their subsidiaries as the Board finds necessary
to assure compliance with the provisions and purposes
of the B H C Act and the Board's regulations and orders
issued thereunder or to prevent evasions of the B H C
Act. Finally, inasmuch as the Board has extensively
considered the offering of trust services through the
instant joint venture between Florida Coast and Midlantic and has determined that the public interest
considerations of section 4(c)(8) favor approval of
these applications, the Board has determined that
future applications by Midlantic and Florida Coast to
extend Trust Company's activities to additional offices
may be processed in the same manner as other de novo
applications under the provisions of section 225.4(b)(1)
of Regulation Y (12 C.F.R. § 225.4(b)(1)). Accordingly
authority is hereby delegated to the Federal Reserve
Banks of N e w York and Atlanta jointly to take action
with respect to applications properly filed as prescribed in that section.
The proposed activities shall not commence 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 Banks of
Atlanta and N e w York, pursuant to delegated authority.
By order of the Board of Governors, effective
May 23, 1983.
Voting for this action: Vice Chairman Martin and Governors Wallich, Teeters, Rice, and Gramley. Absent and not
voting: Chairman Volcker and Governor Partee.
JAMES M C A F E E ,
[SEAL]
Associate
Secretary
of the
Board
6. In Lewis v. BT Investment Managers, Inc., 447 U.S. 27 (1980),
the Supreme Court held a provision of Florida law (Fla. Stat. Ann.
§ 658.29 (West 1981 Supp.)) that generally prohibited an out-of-state
bank or bank holding company from acquiring a trust company or
investment advisory company in Florida, to be unconstitutional at
least insofar as it related to the acquisition of an investment advisory
company. The rationale of that decision is directly applicable to the
trust company prohibitions of section 658.29. The State of Florida has
not objected upon the basis of this statute to previous applications of
this type. Accordingly, the Board concludes that section 658.29 does
not bar Midlantic's participation in this proposal.
Mercantile Bancorporation, Inc.,
St. Louis, Missouri
Order Approving
Insurance
Agency
Activities
Mercantile Bancorporation, Inc., St. Louis, Missouri,
a bank holding company within the meaning of the
Bank Holding Company Act ("Act"), has applied
pursuant to section 4(c)(8) of the Act (12 U . S . C .
§ 1843(c)(8)) and section 225.4(b)(1) of the Board's
Regulation Y (12 C.F.R. § 225.4(b)(1)), for permission
to engage de novo, through its subsidiary, MBI Insurance Agency, Inc., St. Louis, Missouri ("MBI"), in
the sale of property and casualty insurance directly
related to extensions of credit by Applicant's subsidiary banks in Missouri. Such nonbank activities have
been determined by the Board to be closely related to
banking and therefore permissible for bank holding
companies (12 C.F.R. § 225.4(a)(9)). 1
In September 1979, Applicant submitted an application to engage de n o v o through MBI in the sale of
credit-related property and casualty insurance. Notice
of the application, affording opportunity for interested
persons to submit comments on the public interest
factors was published. 2 The application was protested
by the Independent Insurance Agents of America,
Inc., and the Independent Insurance Agents of Missouri (collectively "Protestants").
On August 22, 1980, the Board issued an Order
approving the application, finding that the application
described the proposed activities with sufficient clarity
and that the proposal was likely to have a procompetitive effect and was not likely to result in the tying of
insurance to the extensions of credit by Applicant's
banks, reduced convenience, or other adverse effects. 3 Finding no disputed issue of material fact, the
Board denied Protestants' request for a formal hearing
on the proposal. 4
Protestants sought judicial review of the Board's
Order and, on September 1, 1981, the United States
Court of Appeals for the Eighth Circuit vacated the
Board's Order and remanded the application to the
Board for an evidentiary hearing. 5 In particular, the
Court directed the Board to afford opportunity for
presentation of documentary evidence and testimony
on the following issues: (a) The precise manner in
which Mercantile's de novo entry into the proposed
insurance agency activities is to be effected; (b) the
1. Because it was pending on May 1, 1982, this application is not
subject to the prohibitions of the Garn-St Germain Depository Institutions Act of 1982. Pub. L. No. 97-320, § 601(D), 96 Stat. 1537 (1982).
2. 44 Federal Register 64,564 (1979).
3. 6 6 FEDERAL RESERVE B U L L E T I N 7 9 9 (1980).
4. Id. at 801-02.
5. Independent Insurance Agents v. Board of Governors, 658 F.2d
571 (8th Cir.), reh. denied, 664 F.2d 177 (1981).
Legal Developments
general cost of insurance to be issued by MBI in
comparison to insurance issued by independent agencies; (c) the potential conflict of interest that may
result when Mercantile's loan officer and insurance
agent are the same person; (d) the potential for tying
(coercive and voluntary) the issuance of loan approval
to the purchase of insurance; and (e) the competitive
impact of Mercantile's entry into the relevant insurance market in relation to existing insurance agencies.
On January 12, 1982, in accordance with the decision of the Eighth Circuit, the Board issued an Order
scheduling a formal public administrative hearing on
Mercantile's application. In the interests of administrative economy, the hearing on this application was
partially consolidated with the hearing ordered by the
Board on a pending application by Commerce Bancshares, I n c v Kansas City, Missouri, to engage in
similar activities. Protestants have also objected to the
Commerce application.
A formal public hearing on both applications, conducted in accordance with the Board's Rules of Practice for Formal Hearings (12 C.F.R. Part 263) was held
in St. Louis, Missouri on June 1-8, 1982, before an
Administrative Law Judge appointed at the Board's
request. A substantial record on the application was
developed through submission of exhibits and testimony and participation of Applicant, Protestants, and
counsel for the Board.
In his Recommended Decision dated January 12,
1983, Administrative Law Judge Max O. Regensteiner
concluded, based upon evidence of record, that the
application should be approved on condition that
Applicant comply with the Board's requirements concerning the cost of insurance to be sold. In all other
respects, Judge Regensteiner found that the proposal
complied with the requirements set out in § 4(c)(8) of
the Act. Protestants and Applicant timely filed exceptions to the Recommended Decision.
Having carefully considered the entire record of the
proceedings, including the comments received, and
the transcript, exhibits, written testimony, rulings, and
briefs filed in connection with the hearing and the
Recommended Decision filed by the Administrative
Law Judge, together with the exceptions thereto, the
Board finds for the reasons explained below that the
Board's requirement concerning the cost of insurance
to be sold does not preclude the granting of this
application. In all other respects, the Board has determined that the Administrative Law Judge's findings of
fact, conclusions of law, and recommendations, as
modified and supplemented herein, are fully supported
by the evidence of record and should be adopted as the
findings and conclusions of the Board.
Applicant is among the two largest banking organizations in Missouri, with aggregate deposits of over
457
$3.1 billion. Applicant proposes to act de novo as
agent or broker for property and casualty insurance
directly related to extensions of credit by its subsidiary
banks. These insurance activities would be performed
through MBI, a Missouri corporation that will be a
non-banking subsidiary of Applicant. MBI's activities
would be conducted from a central office located at
Applicant's headquarters in St. Louis. Under Applicant's proposal, insurance would be sold on bank
premises by employees of its subsidiary banks, w h o
will be licensed insurance agents.
Section 4(c)(8) of the Act provides that the Board
may approve a bank holding company's application to
engage in a nonbanking activity if the Board determines that the proposed activity is so closely related to
banking as to be a proper incident thereto. The Board
has determined by regulation that the sale, as agent, of
credit-related insurance is a permissible nonbanking
activity. 6 This determination was affirmed on judicial
review in Alabama Association of Insurance Agents v.
Board of Governors J
To approve an application under section 4(c)(8) of
the Act, the Board must also determine that the
performance of the proposed activities by a nonbank
subsidiary of a bank holding company 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.
Sufficiency
of the Description
of the
Proposal
Protestants assert that Applicant's proposal is not
sufficiently specific to allow the Board to analyze it
under section 4(c)(8). First, Protestants allege that
Applicant has failed to describe the specific types of
credit property and casualty insurance Applicant proposes to sell. H o w e v e r , the Administrative Law Judge
admitted into the hearing record the application and
related correspondence, 8 which contained specific examples of the types of credit-related insurance proposed: (1) physical damage insurance on property used
as collateral for an extension of credit, such as fire
insurance on improved real property, fire and inland
marine insurance on household contents, boats and
equipment, physical damage insurance on mobile
6. 12 C.F.R. §§ 225.4(a)(9), 225.128(b).
7. 533 F.2d 224 (5th Cir. 1976), modified on rehearing, 558 F.2d 729
(1977), cert, denied, 435 U.S. 904 (1978).
8. The Board finds no error in the admission of the application and
related correspondence into evidence. As Protestants have recognized
in their own pleadings, the standards for admission of documentary
evidence applicable in administrative hearings are quite permissive.
See 12 C.F.R. § 263.9.
458
Federal Reserve Bulletin • June 1983
homes, and collision and comprehensive coverage on
automobiles; and (2) insurance customarily sold as
part of a package with such insurance, such as automobile liability insurance and comprehensive personal
liability coverage, as part of a homeowner's or mobile
homeowner's policy. 9 In accordance with the decision
of the Administrative Law Judge and its previous
ruling on this application, the Board finds that the
proposed activities are described in sufficient detail to
assure compliance with the Act. The Board's determination that the sale of credit-related property and
casualty and related liability insurance is permissible
necessarily permits the sale of any particular lines of
insurance that reasonably fall within that general category. Applicant has not proposed to sell types of
insurance that are not credit-related property or casualty or other types of permissible insurance and has
given specific examples of particular lines to be offered. Protestants have not alleged any prejudice resulting from being unable to identify as yet unspecified
lines of credit-related insurance. 1 0
Protestants also allege that, as recognized in the
Alabama Insurance Agents decision, they are entitled
to have a specific proposal to challenge under the
public benefits test and Applicant has not disclosed
many of the details concerning the manner in which
MBI would operate. The level of detail necessary for
application of the public benefits tests depends on the
nature of the determinations that must be made, which
are "necessarily imprecise and to some degree speculative." 1 1 Congress could not reasonably have required a bank holding company to describe proposed
operations of permissible nonbank activities in such
detail that the company could not adapt such operations to changing market conditions without obtaining
additional approval. On the other hand, the Board
cannot carry out its statutory obligation and potential
competitors cannot exercise their right to challenge a
particular application absent a reasonably specific
proposal. 1 2 The Board, however, adopts the Administrative Law Judge's finding that Applicant's proposal
is sufficiently specific. Applicant has provided the
9. The application also referred to insurance related to "the provision of other financial services." In response to a request from the
Federal Reserve Bank of St. Louis to define that phrase, Applicant
responded that the phrase was taken directly from Regulation Y,
where it is not defined. Applicant gave as a possible example
insurance in connection with the servicing of mortgage loans for
investors. No question has been raised concerning this aspect of the
application.
10. Approval of the application will not, as Protestants claim, give
Applicant a blank check to alter its approved activities at will.
Regulation Y provides that nonbanking activities approved by the
Board shall not be altered in any significant respect from those
considered by the Board in making its determination, unless the prior
approval requirements of the Act are complied with. 12 C.F.R.
§ 225.4(c)(2).
11. 533 F.2d at 246.
12. Id. at 253.
basic information on the operation of its proposed
insurance sales activity. An officer or employee at
each of Applicant's subsidiary banks would be a
licensed agent and would not be compensated based
on the amount of insurance sold. The record does not
reflect that the alleged lack of specific operational
details has impaired the Board's ability to assess the
net public benefits associated with the proposal or
Protestant's ability to challenge this aspect of the
application. Moreover, in the Alabama Insurance
Agents case, where the applications were framed in no
greater detail concerning day-to-day operations than
Applicant's proposal here, the court expressly stated
that detailed descriptions of the procedures for carrying on the activity are neither feasible nor required,
especially in the case of de novo applications where
the applicant lacks experience in the proposed activities. 13
Public Benefits
and Adverse
Effects
Consistency with State and Federal Banking Law
Protestants assert that neither national banks nor
banks chartered under Missouri law are expressly
authorized to act as agent in selling credit-related
property and casualty insurance and that therefore
Applicant's subsidiary banks are prohibited from engaging in the proposed insurance agency activities. 1 4
However, these laws relied on by Protestants govern
the powers of banks and do not by their terms prohibit
the acquisition by a bank holding company of a
nonbank subsidiary engaged in selling credit-related
insurance. At least one court has held, however, that
the Board's determination whether public benefits
may be expected from a particular proposal to engage
in insurance activities depends on whether applicable
laws may restrict or limit the manner in which the
applicant conducts the proposed services. 1 5 The rationale of this decision suggests that, in assessing the
public benefits claimed by Applicant, the Board must
determine if laws cited by Protestants might restrict
the manner in which Applicant contemplates carrying
out the proposed activities and thus affect the likelihood of expected public benefits or adverse effects.
The laws governing the powers of national and
Missouri banks would not affect this proposal unless
Applicant's subsidiary banks are, to some extent at
least, themselves engaged in the activity proposed by
Applicant. With respect to Applicant's Missouri-char-
13. 533 F.2d at 253.
14. Applicant has both national and Missouri-chartered subsidiary
banks.
15. Florida Ass'n. of Ins. Agents v. Board of Governors, 591 F.2d
334, 338-40 (5th Cir. 1979).
Legal Developments
tered banks, it is unnecessary for the Board to consider this question because, even if these banks are
viewed as engaged in selling credit property and
casualty insurance, it seems reasonably clear that they
are permitted to do so under Missouri law. In resolving
issues of state law, the Board considers the statute
itself, any judicial interpretations of that law and, in
the absence of judicial construction, opinions of the
relevant state administrator. There is no Missouri
statute or court opinion directly pertaining to this
issue, but, at the Administrative Law Judge's request,
the state Commissioner of Finance submitted an opinion on this issue, stating that Missouri banks are
authorized to provide the type of credit-related insurance proposed by Applicant based on, among other
things, a 1981 statute permitting a state bank to
exercise all powers "necessary, proper and convenient" to effect any or all of the purposes for which it
was formed. 16 The Board does not believe that the
Commissioner's opinion is unreasonable or plainly
erroneous. It is not unreasonable to view selling
property and casualty insurance to protect the collateral the bank has taken on an extension of credit as
necessary, proper, and convenient to the making of
the loan, since property and casualty coverage of the
collateral is a prerequisite in many cases to the making
of a secured loan. 1 7
Protestants argue that if the Missouri legislature had
intended to permit banks to sell credit property and
casualty insurance, it would have said so expressly.
The very purpose of an incidental powers clause,
however, is to avoid the necessity of enumerating
specific activities. Moreover, contrary to Protestants'
claim, the Commissioner's interpretation of the scope
of necessary incidental powers does not blur the
distinction between state banks and state trust companies, which may serve as insurance brokers generally, 18 because banks may only sell property and casualty insurance directly related to an extension of credit
by the bank, while trust company insurance agency
activities are under no such limitation. In their arguments on the expected convenience aspects of this
proposal, Protestants recognize that the limitation to
credit-related insurance differentiates that activity
from general insurance agency functions. 1 9
With respect to national banks, the law is less clear.
The only court opinion on the sale by national banks of
16. Mo. Ann. Stat. § 362.106(1).
17. See Alabama Ass'n. of Ins. Agents v. Board of Governors, 533
F.2d at 244.
18. Mo. Ann. Stat. § 362.105.2(7).
19. The Commissioner also found authority to sell credit property
and casualty insurance implicit in a Missouri bank's statutory authority to make loans. Mo. Ann. Stat. § 362.105.1(1). Protestants point to a
1936 opinion of the Missouri Attorney General interpreting the lending
459
credit-related property and casualty insurance ruled
that the activity is not authorized. 2 0 In a letter to the
Administrative Law Judge, the Comptroller's staff
stated that this decision was incorrect because, among
other things, it has now been recognized that national
banks may sell credit life insurance as a permissible
incidental activity and that credit property and casualty coverage may also reasonably be viewed as an
appropriate incidental activity. This staff opinion has
not yet been adopted by any court, creating uncertainty as to whether Applicant's subsidiary national
banks, if deemed to be engaged to some extent in the
proposed activity, may do so under the National Bank
Act. Accordingly, the Administrative Law Judge recommended that the application be approved on the
condition that employees of Applicant's national bank
subsidiaries enter into employment contracts with
MBI providing for the payment by the holding company of a regular salary to those employees and permitting MBI to control the employees' selling of credit
property and casualty insurance. The Board adopts
this condition recommended by the Administrative
Law Judge in order to eliminate any legal uncertainty
concerning whether the proposed activities will be
carried out in the manner planned by Applicant. In the
Board's view, such a condition would give the holding
company sufficient control over the conduct of the
selling of insurance that the activity would not be
viewed as an activity of the bank. 21
Contrary to Protestants' claims, the Board, as evidenced by its consistent and longstanding practice, has
the authority to impose conditions on its approval of a
proposal under section 4(c)(8) to eliminate from the
activity grounds that would justify denial of the application. In any event, Applicant has not objected to the
imposition of the condition requiring employment contracts, nor have Protestants identified any particular
disputed facts relating to the operation of this condition that would necessitate an evidentiary hearing on
this point.
and other powers of state banks and concluding that the lack of
express authorization precludes a state bank from selling any insurance. However, the fact that for eight years state banks have been
permitted by the Commissioner to sell credit life insurance suggests
that the rationale of the Attorney General's opinion is no longer
adhered to.
20. Saxon v. Georgia Ass'n. of Independent Ins. Agents, 399 F.2d
1010 (5th Cir. 1968). The court reasoned that since a national bank is
expressly permitted to act as an agent for a life, fire, and other types of
insurance company in a town with a population of less than 5,000, the
bank is prohibited from offering insurance in towns with a greater
population. Virtually all of Applicant's national bank subsidiaries are
located in towns with populations in excess of 5,000.
21. Grandview Bank & Trust Co. v. Board of Governors, 550 F.2d
417, 429 (8th Cir.), cert, denied, 434 U.S. 821 (1977). (As a general
matter, the separate corporate entities of companies in a bank holding
company system should be respected, unless the corporate entities are
operated in a unitary fashion or there is "fraud or a complete
subterfuge").
460
Federal Reserve Bulletin • June 1983
Expected Public Benefits
Increased Competition.
Approval of Applicant's proposal will add one new competitor with 34 offices in
the state of Missouri. Congress expressly authorized
the Board to differentiate, in connection with a bank
holding company's application to engage in nonbanking activities, between de n o v o entry into a field and
acquisition of a going concern. 2 2 Because de novo
expansion provides an additional source of competition, the Board and the courts view such expansion as
being procompetitive in the absence of evidence to the
contrary. 23
In remanding this case for a formal hearing, the
court of appeals ruled that the Board may not automatically approve all de n o v o acquisitions and directed the
Board to hold an evidentiary hearing on the precise
manner in which de n o v o entry is to be accomplished
as well as other possible adverse effects. 2 4 The record
here demonstrates that approval of Applicant's proposal would result in the introduction of a competitor
offering a more convenient service—the ability to
obtain both a loan and insurance at a single location.
According to the record, the attractiveness of "onestop shopping" is likely to force independent agents to
improve their services in order to compete with the
new entrants. 25 In addition, the record indicates that
other bank holding companies and other financial
institutions, including one of the largest holding companies in the state, 26 currently sell credit property and
casualty insurance. Approval of this proposal would
permit Applicant to offer a range of services similar to
those offered by these organizations and thus to compete more effectively with them. 2 7
22. 12 U.S.C. § 1843(c)(8). The legislative history of the Act
demonstrates that Congress authorized this distinction because it
viewed de novo entry as beneficial to competition. S. Rep. No. 1084,
91st Cong., 2d Sess. 15, 16 (1970).
23. BankAmerica Corporation (Decimus Corporation), 66 FEDERAL RESERVE BULLETIN 511 (1980); Citicorp (Person to Person), 65
FEDERAL RESERVE BULLETIN 507 (1979); U.N. Bancshares,
Inc., 59
FEDERAL RESERVE BULLETIN 204 (1973); A l a b a m a A s s ' n . of Ins.
Agents, 533 F.2d at 249.
24. 658 F.2d at 574-75.
25. Protestants' claim that this competition would be unfair is
discussed below.
26. S e e First Union Bancorporation,
67 FEDERAL RESERVE BULLE-
TIN 515 (1981).
27. Applicant also offered evidence that its de novo entry would
have a beneficial effect on price competition. The Administrative Law
Judge found such evidence unpersuasive, particularly in light of the
fact that the cost of insurance coverage is usually determined by the
underwriter, not the agent, and in light of his finding that Applicant
has not committed to obtain insurance at the lowest practicable cost.
The Board makes no findings on any compelling procompetitive
effects due to increased price competition as a result of this proposal.
Greater Convenience.
Applicant would place at least
one licensed insurance agent at each main office of its
subsidiary banks. The evidence shows that this arrangement would provide increased convenience at
least for those loan customers w h o do not already have
insurance coverage that would automatically extend to
the loan collateral or could easily be extended to cover
the collateral. Such customers would be able to avoid
an additional visit with another agent (and the resulting
duplicative paperwork) and to deal with a single person knowledgeable about both aspects of the transaction.
Protestants allege that this increased convenience,
found by the Administrative Law Judge to be "self
evident," would be offset by alleged inconveniences
inherent in the proposed services. For example, Protestants point out that when the loan covering insured
collateral has been paid, Applicant could not renew
the insurance coverage on the collateral. Nor could
Applicant offer multi-car or "fleet" discounts if Applicant has not extended credit on all the insured's
vehicles. H o w e v e r , Applicant has represented that it
would encourage customers to take advantage of discounts available through other agents. Thus, a customer w h o c h o o s e s insurance offered by Applicant is
likely to be aware of any potential inconveniences and
presumably would not purchase the insurance if it
were seriously inconvenient. The Board believes that
the fact that a holding company either chooses not to
offer certain services, or is prevented by the Board's
regulations from offering those services, does not
represent the kind of adverse effect with which section
4(c)(8) was concerned, since the adverse effect asserted by Protestants is avoidable from the borrower's
perspective. 2 8 The Board considers the insurance
agency activities of holding companies to be an alternative to, rather than a replacement for, services
provided by independent insurance agents, and believes that insurance customers should be allowed to
choose between such alternatives. Protestants, on the
other hand, in effect assert that customers should be
denied this choice because Applicant cannot offer a
complete range of services. The Board finds this
contention to be without merit.
Protestants also assert that, because Applicant's
agents would spend a relatively small part of their time
on insurance activities, the quality of their service to
the public would be lower than that provided by
independent agents. This contention is not supported
by the record. The employees of Applicant would
28. See Virginia National Bankshares, Inc., 66 FEDERAL RESERVE
BULLETIN 668, 671 (1980), afiTd sub nom.; Independent Ins. Agents of
America Inc., v. Board of Governors, 646 F.2d 868 (4th Cir. 1981)
("Virginia National").
Legal Developments
provide only a f e w types of insurance coverage, so it is
likely that they would develop expertise in those
limited fields. N o r does the record support a finding
that the quality of service provided by Applicant's
agents would be significantly less than the average
quality of services provided by independent agents.
Increased Efficiency. Applicant claims that efficiencies will result from its proposal, primarily because of
the centralization of its operations. Because of a lack
of specific evidence in the record to support these
contentions, the Administrative Law Judge found little
likelihood of increased efficiency as a result of this
proposal. This finding is reasonable and is adopted by
the Board.
Lowest Practicable
Cost. Applicant has indicated that
it would offer insurance at the lowest practicable cost
to the customer. This intention reflects the statement
made by the Board in the preamble to the amendment
to Regulation Y adding insurance agency activities to
the list of permissible activities for bank holding
companies. The Board expressed its expectation that
. . . any holding company or subsidiary that acts as
an insurance agent on the basis of the new regulatory
provision will exercise a fiduciary responsibility—that
is by making its best effort to obtain the insurance at
the lowest practicable cost to the customer. 2 9
The Administrative Law Judge found, based on
testimony of Applicant's president that the cost of
insurance offered by Applicant would be competitive,
that Applicant failed to demonstrate that it would in
fact offer insurance at the lowest practicable cost. The
Administrative Law Judge further concluded that,
because compliance with the lowest practicable cost
standard is a prerequisite to approval, the application
should be denied absent imposition of some condition
requiring compliance with that standard.
The Board adopts the Administrative Law Judge's
finding that no public benefits would result from cost
considerations related to Applicant's proposal, but is
unable to adopt the recommendation of denial, which
appears to be based on a misunderstanding of the
nature of the Board's expectation concerning the cost
of credit insurance sold by bank holding companies.
The Board has not had occasion prior to this application to elaborate on the meaning of its expectation that
a bank holding company would provide insurance at
the lowest practicable cost. Based on a review of the
29. 36 Federal Register 15,525 (1971).
461
issues raised in the original rulemaking proceeding on
insurance activities, the Board believes that its expectation that a bank holding company selling insurance
would be under a fiduciary duty means that the holding
company should serve as agent for the loan customer/
insured, not solely for itself or for the underwriter of
the insurance being sold. Thus, a holding company
should put aside its own interest in obtaining a commission and make a reasonably diligent effort to obtain
the insurance for the customer on the best possible
terms, including the lowest cost. 3 0 Since the fiduciary
duty to obtain insurance is limited by concerns of
practicability, however, the holding company should
also consider the quality of the services to be provided
in determining what constitutes the lowest cost.
In any event, it is clear that the Board does not
require an affirmative showing by a bank holding
company that the cost of the insurance it sells must be
reduced below the prevailing costs for the particular
type of coverage involved as a prerequisite for approval of an application. Where the Board has imposed a
requirement of reduced costs as a condition for engaging in a nonbanking activity, as it has done regarding
the underwriting of credit life insurance, the Board has
made this condition explicit in the terms of Regulation
Y itself. 31 The Board has in the past approved many
applications to sell credit-related insurance without
requiring a specific showing of a reduction in the cost
of the insurance to be sold. In the Alabama case, for
example, the court upheld the Board's determination
that particular applications to sell credit-related insurance, including property and casualty insurance, met
the net public benefits test of section 4(c)(8) without
any specific showing that the insurance would be
offered at a cost lower than insurance sold by competitors. 32 Some applicants have made a voluntary commitment to provide insurance to their customers at
below prevailing costs. Such a commitment has been
considered a positive public benefit for purposes of the
section 4(c)(8) balancing test. On the other hand,
evidence that an applicant would not exercise reasonable diligence in obtaining insurance coverage at the
lowest practicable cost must be viewed as an adverse
30. As a general rule, any insurance agent who obtains insurance on
behalf of an insured is under a fiduciary duty to the insured. E.g., Zeff
Dist. Co. v. Aetna Casualty & Surety Co., 389 S.W. 2d 789, 795 (Mo.
1965); Myers, "Legal and Professional Responsibilities of Agents and
Brokers", in Property and Liability Insurance Handbook, 1028, 103435 (J. Long and D. Gregg, eds. 1965).
31. 12 C.F.R. § 225.4(a)(10). ("The Board will only approve
applications [to act as underwriter for credit life insurance] in which
an applicant demonstrates that approval will benefit the consumer . . .
[by] a projected reduction in rates . . . .").
32. 533 F.2d at 249. (The court noted only that there was evidence
of some pressure for lower prices).
462
Federal Reserve Bulletin • June 1983
effect that, when weighed against possible public benefits, might well require denial of such an application. 33
The Administrative Law Judge found no evidence of
any awareness of fiduciary duty in the testimony of
Applicant's president on Applicant's cost policies.
Applicant states that its president misunderstood an
ambiguous standard and that Applicant would comply
with the meaning of the lowest practicable cost standard as clarified by the Board. The Board has now
provided some guidance as to its expectation concerning lowest practicable cost of insurance and expects
Applicant to comply with that direction.
There is no evidence in the record that the cost of
the credit-related insurance sold by Applicant here
would be higher than the cost of comparable coverage
sold by other agents or that Applicant would not make
reasonable efforts to obtain the types of coverage it
chooses to sell on the best possible terms, including
the lowest cost. Thus, the Board finds that cost
considerations would not present any serious adverse
effects, but would not produce any significant public
benefits. 3 4
In summary, the Board finds that this proposal is
likely to result in benefits to the public in the form of
increased competition and greater convenience.
Lack of Significant Adverse Effects
Decreased
Competition
or Undue Concentration
of
Resources.
Since Applicant would enter the credit
property and casualty insurance field de novo, this
proposal would not result in the elimination of any
existing or potential competition or in any undue
concentration of resources. Protestants allege that the
proposal will have a harmful effect on independent
insurance agents, pointing to evidence that because of
Applicant's size and statewide presence, MBI would
soon reach significant size in relation to the typical
independent agency. The fact that Applicant, by offering lower prices or better services, may take business
away from some inefficient independent agents does
not in itself constitute decreased competition for purposes of section 4(c)(8) for, as the Board has noted
elsewhere, the antitrust laws are designed to protect
competition, not competitors. 3 5 In any event, there is
no persuasive evidence that MBI's size alone will give
it unwarranted market power, given the generally low
barriers to entry into the industry and the fact that,
while independent agencies are free to offer a full line
of insurance, MBI may provide only property and
casualty insurance related to extensions of credit by
Applicant's subsidiaries. Moreover, as pointed out
above, approval of this application would permit Applicant to compete with at least one other statewide
bank holding company that currently is authorized to
provide credit property and casualty insurance, and to
offset the potential dominance of that company in this
product submarket.
Unfair Competition—Voluntary
Tie-Ins. Protestants
allege that this proposal would result in the unfair tying
of insurance sales to extensions of credit. Section 106
of the Bank Holding Company Act Amendments of
1970 36 makes it illegal for a bank to require the
purchase of some additional service from the bank in
order to obtain credit. By its terms, section 106, which
the Board has applied by regulation to bank holding
companies, 3 7 prohibits both implicit and explicit conduct on the part of the lender designed to convey the
requirement that an additional service must be purchased. Protestants have produced no evidence that
Applicant has not or would not comply with this
prohibition.
Protestants also allege that, apart from explicitly
coerced joint sales, the proposal would also produce
significant voluntary tying, which results when a customer believes that he or she stands a better chance of
obtaining a scarce product by purchasing another
product or service from the same seller. 38 A s the
Board has consistently found, in accordance with
congressional and judicial teaching, the likelihood of
voluntary tying depends on the market power of the
seller and the scarcity of the product offered. 3 9 The
possibility of voluntary tying is significantly reduced
where the relevant markets are competitive and the
number of alternative sources for a product (e.g.,
35. E.g., BankAmerica
Corp (Decimus Corp.), 66 FEDERAL RE-
SERVE B U L L E T I N a t 515.
33. Although the Administrative Law Judge's findings as to the
facts are entitled to weight, see Alabama Ins. Agents, 533 F.2d at 247,
the Judge's decision here on the meaning of the Board's statement on
lowest practicable cost is a purely legal determination concerning a
Board-imposed expectation applying generally to all holding company
insurance agency activities.
34. In directing a hearing on this proposal, the court of appeals
stated that the Board must consider general proposed insurance rates
in reviewing the validity of Protestants' claims that Mercantile's rates
will be much higher than those offered by independent agents in the
relevant markets. 658 F.2d at 576 n.7. Protestants have not advanced
such claims in this proceeding.
36. 12 U.S.C. §§ 1971-78.
37. 12 C.F.R. § 225.4(c)(1). The statute also provides that a person
injured by an illegal tying arrangement may recover treble damages.
12 U.S.C. § 1975.
38. Voluntary ties (or implicitly coerced joint sales) are to be
distinguished from truly voluntary joint sales, which may create a
public benefit by reducing the inconvenience of searching for the
second product.
39. E.g., Virginia National Bancshares, Inc., 66 FEDERAL RESERVE BULLETIN at 670 (1980); H . R . R e p . N o . 1747, 91st C o n g . , 2d
Sess. 18, reprinted in 1970 U.S. Code Cong. & Ad. News 5561, 5569;
Alabama Ass'n. of Ins. Agents v. Board of Governors, 533 F.2d at
250.
Legal Developments
credit) is large. The record shows, as the Administrative Law Judge found, that there are at least several
and, in many cases, significant numbers of banks and
other lending institutions that serve as alternative
sources of credit in the relevant geographic markets in
which Applicant's subsidiary banks operate. Although
there is evidence of market concentration in a few
relevant markets, the banks involved represent such a
small portion of Applicant's operations that the potential for voluntary tie-ins in the context of the proposal
as a whole is not significant.
In addition, Applicant has made a number of commitments designed to minimize the likelihood of voluntary tying. Applicant has committed that it would
advise its customers in writing that the customer may
choose insurance from any source, that Applicant's
agents/loan officers would not discuss credit insurance
with a prospective borrower until after the credit had
been granted, and that the agent would not be compensated based on the amount of insurance sold. 4 0 Protestants question the likelihood of compliance with these
commitments. H o w e v e r , the Board's practice of reliance on similar commitments has been approved by
the courts, 41 the Board possesses ample authority to
enforce such commitments, 4 2 and Protestants have
offered no specific evidence that such commitments
would not be observed.
Protestants challenge the Administrative Law
Judge's conclusions regarding evidence submitted by
Protestants relating generally to the unlikelihood of
tie-ins in bank sales of credit insurance. The Administrative Law Judge found some of this testimony quite
persuasive but concluded that the conclusions drawn
by Protestants from such testimony had already been
rejected by prior Board decisions. Protestants assert
the Judge erred in not considering the particular facts
in the record on this proposal, notwithstanding prior
Board determinations. In light of these objections, an
independent review of the record has been made, and
the Board concludes that the Administrative Law
Judge correctly determined that this record does not
show a substantial likelihood of voluntary tie-ins. The
evidence cited by Protestants, which consists of several economic studies prepared by Board staff and
others, and expert testimony that tie-ins were likely
because of the dominant power of the lender in a credit
transaction, is based primarily on economic theory
and on facts inherent in any sale of credit insurance by
40. As explained above, the Board has conditioned approval of this
proposal on a requirement that agents employed by Applicant's
subsidiary national banks be compensated for their insurance activities by a salary from MBI. The Board expects this commitment to
extend to such salaries paid by MBI.
41. E.g., Virginia National, 646 F.2d at 869-70.
42. E.g., 12 U.S.C. § 1818(b)(1), (b)(3).
463
a banking organization and does not relate to any
matter unique to Applicant's proposal. The Board has
considered and commented on the same evidence or
very similar evidence in the rulemaking proceeding on
the permissibility of insurance activities, in congressional hearings, and in many other applications under
the Act. For the reasons stated in the Board's testimony and its orders on these occasions, the Board does
not believe that such evidence demonstrates the likelihood of substantial voluntary tying in the sale of credit
insurance by a banking organization, nor does the
Board find that its staff's tie-in study (taking into
account criticisms of that study) shows substantial
probability of adverse tying arrangements. 43
Protestants point to evidence directly related to this
proposal, in particular the fact that, unlike other
insurance agency proposals, under Applicant's proposal the employee making the loan would also serve
as the agent selling the insurance in some cases. A s the
Administrative Law Judge found, however, any increased potential for tying resulting from this arrangement would be offset by the structure of the relevant
markets and by Applicant's commitments, especially
the commitment not to discuss insurance until after the
loan has been approved.
The record also indicates that Applicant has
achieved significantly high penetration rates 44 in the
sale of credit-related life insurance, which is offered
directly by its subsidiary banks, and in the testimony
of Applicant's president that, at least in some rural
banks, bank officers actively solicited credit life sales.
However, penetration rates alone do not necessarily
demonstrate the extent of implicitly coerced joint
sales, and experience regarding the sale of credit life
insurance is not necessarily indicative of likely practices in the sale of credit property and casualty insurance since, unlike credit property and casualty insurance, credit life insurance is offered only by lenders,
and is significantly less expensive than credit property
and casualty insurance.
Because of the existence of alternate sources and
the relatively high cost, borrowers are likely to feel
much less obligated to volunteer to purchase property
43. Much of this general evidence cited by Protestants relates to
other types of insurance, such as credit life and title insurance, that
differ in material respects from credit property and casualty coverage,
or relates to lenders, such as independent finance companies, that are
not subject to the comprehensive federal regulation applicable to
banking institutions. Moreover, the theoretical arguments concerning
the dominant position of a creditor in a loan transaction are countered
by accepted economic doctrine that such power is diluted by the
existence of other sources of credit. Finally, the Board has, in
testimony presented to Congress, explained why the criticisms of its
staff study do not undermine the conclusions reached by the study.
44. Penetration rate refers to the percentage of loan customers of a
particular lender who also purchase credit insurance from the lender
or its affiliate.
464
Federal Reserve Bulletin • June 1983
and casualty insurance through Applicant than to purchase credit life insurance. Moreover, the sale of credit
life insurance by Applicant's banks does not appear to
be subject to the anti-tying commitments made here with
respect to the sale by MBI of credit property and
casualty coverage. Based on the facts of record, and in
light of commitments made by Applicant, the Board
finds that the possibility of tying does not represent a
serious adverse effect of this proposal. 45
Conflicts of Interest. Protestants also assert that the
proposal would result in serious conflicts of interest
because, for example, Applicant may encourage customers to finance insurance premiums rather than take
advantage of cheaper premium deferral plans or to
choose lower deductibles in order to obtain better
protection for the underlying collateral. Applicant, for
its part, states that it is in Applicant's ultimate best
interests not to take advantage of its customers for
short-run profit and would not promote the sale of
insurance if the borrower could obtain discounts elsewhere. In addition, the compensation of Applicant's
agents would not depend on the amount of insurance
sold. The record also indicates that the amount of the
deductible on insurance covering collateral is not of
significant importance to lenders.
Based on the record, the Board concludes that the
possibility of adverse effects resulting from conflicts of
interest as a result of the proposal is only slight. A s the
court in the Alabama case stated:
[c]ontrary to the argument of the N A I A parties
[Protestants], the fact that a holding company's interest as a lender and as an insurer do not totally
converge does not require the conclusion that conflicts
of interest will occur. 4 6
Protestants'
Procedural
Claims
Protestants object to the Administrative Law Judge's
rejection of Protestants' motion to strike the brief filed
by counsel representing the Board in this proceeding,
which, Protestants assert, was biased against them.
Since this motion was without merit, the Administrative Law Judge clearly did not abuse his discretion in
45. Protestants' assertion that Applicant would engage in unfair
competition by requiring independent agencies to submit their customer lists in connection with loans from Applicant's subsidiaries to
such agencies does not appear realistic, since Applicant may sell
credit insurance only to its loan customers, a fact that may be
independently obtained from Applicant's own records. Nor does it
appear that a banking organization would obtain any unfair advantage
by having exclusive access to prospective customers for insurance at
the time they seek a loan and hence have most need of insurance
coverage. These same customers are very likely to have a relationship
with a non-bank-related agent for types of insurance, i.e., ordinary life
insurance, that a banking organization may not sell.
46. 533 F.2d at 252.
denying it. A review of the record indicates that Board
counsel clearly did not unfairly carry Applicant's
burden of proof. 4 7 The Board's regulations governing
formal hearings do not prohibit Board counsel from
taking a position on the evidence adduced at a hearing,
especially if, as here, the Board has already taken
positions on the legal ramifications of many of the
facts involved. 4 8 The fact that such positions were
adverse to Protestants does not demonstrate unfair
bias. Moreover, the lack of prejudice to Protestants is
further demonstrated by the fact that Protestants were
able to, and did, submit to the Administrative Law
Judge and to the Board, briefs pointing out in detail
what Protestants believed to be errors in the positions
taken by Board counsel. Protestants' claim that the
Administrative Law Judge was unduly influenced by
Board counsel is without merit. It is evident from the
Recommended Decision that the Administrative Law
Judge conducted an independent review of the evidence and arguments and, indeed, did not accept
Board counsel's arguments on some points. 4 9
Protestants also request the opportunity to present
oral argument before the Board on this case. In the
Board's view, the numerous briefs and other submissions of the parties adequately explain the issues
involved and, accordingly, oral argument before the
Board at this time would serve no useful purpose.
Based upon all evidence and legal arguments presented by the parties, the Board finds that consummation of this proposal, subject to the conditions imposed
in this Order, may not reasonably be expected to
produce any significant undue concentration of resources, decreased or unfair competition, conflicts of
interests, unsound banking practices or other adverse
effects. The Board further finds that public benefits in
the form of increased competition and greater convenience can reasonably be expected to result from this
proposal, and that such public benefits are sufficient to
outweigh the slight possibility that adverse effects,
such as voluntary tying or conflicts of interest, might
result from this proposal.
Based upon the foregoing and other considerations
reflected in the record, the Board has determined that
47. Indeed, Board counsel's cross-examination of Applicant's witness demonstrated that the strength of its commitment on cost of
insurance sold was not what it appeared initially.
48. The Board's rules provide that Board Counsel "shall represent
the Board in a nonadversary capacity for the purpose of developing
for the record information relevant to the issues to be determined by
the presiding officer and the Board." 12 C.F.R. § 263.6(d).
49. The Board has considered Protestants' other procedural arguments and finds them to be without merit. These arguments relate to
the weight to be accorded certain record evidence. The Board believes
that the fact that an applicant describes its proposed insurance
operations in a written application or in the testimony of a non-expert
does not make the Administrative Law Judge's findings based on such
evidence less than substantial.
Legal Developments
the balance of the public interest factors that the Board
is required to consider under section 4(c)(8) is favorable. Accordingly, the application is hereby approved,
subject to the condition that all employees of Applicant's national bank subsidiaries engaged in selling
credit property and casualty insurance enter into employment contracts with MBI providing for the payment of a regular salary by the holding company to
such employees, and permitting MBI to control the
employees' sale of insurance. This determination is
subject to the conditions set forth in section 225.4(c) of
Regulation Y and to the Board's authority to require
such modification or termination of the activities of a
holding company or any of its subsidiaries as the
Board finds necessary to assure compliance with the
provisions and purposes of the Act and the Board's
regulations and orders issued thereunder or to prevent
evasion thereof. The Board has also relied on the
commitments made by Applicant with regard to this
proposal and is prepared to ensure compliance with
those commitments.
The transaction shall be made not later than three
months after the effective date of this Order, unless
such period is extended for good cause by the Board or
by the Federal Reserve Bank of St. Louis, pursuant to
delegated authority.
By order of the Board of Governors, effective
May 31, 1983.
Voting for this action: Vice Chairman Martin and Governors Teeters, Rice, and Gramley. Absent and not voting:
Chairman Volcker and Governor Partee. Present and abstaining: Governor Wallich.
JAMES M C A F E E ,
[SEAL]
Associate
Secretary
of the
Board
Orbanco Financial Services Corporation,
Portland, Oregon
Order Authorizing Underwriting and Dealing in
Certain Government Securities and Money
Market
Instruments
Orbanco Financial Services Corporation, Portland,
Oregon, a bank holding company within the meaning
of the Bank Holding Company Act ("Act"), has
applied for the Board's approval under section 4(c)(8)
of the Act, 12 U . S . C . § 1843(c)(8), and section
225.4(b)(1) of the Board's Regulation Y (12 C.F.R.
§ 225.4(b)(1)) to allow its subsidiary, Orbanco Securities Corporation, to engage de novo in the activities of
underwriting and dealing in certain government securities and money market instruments.
Notice of the application, affording opportunity for
465
interested persons to submit comments, has been
given in accordance with section 4 of the Act. (48
Federal Register 8587). The time for filing comments
has expired, and the Board has considered the application and all comments received in light of the public
interest factors set forth in section 4(c)(8) of the Act.
Applicant, with consolidated assets of $1.4 billion,
controls four banks in the State of Oregon. The
activities Applicant proposes are currently performed
by Applicant's lead bank, The Oregon Bank (total
deposits of $693 million), or by Applicant's commercial finance company, Northwest Acceptance Corporation, (total assets of $346 million as of April 30,
1982). 1
Applicant seeks approval for Orbanco Securities
Corporation ("Orbanco Securities") to engage de
novo in the activities of soliciting, underwriting, dealing in, purchasing, and selling such obligations of the
United States, general obligations of various states
and political subdivisions thereof, and such other
obligations, including money market instruments such
as bankers acceptances and certificates of deposit, as
state member banks may from time to time be authorized to underwrite and deal in. These activities would
be performed from an office of Orbanco Securities
located in Portland, Oregon, and serving the states of
Washington and Oregon. These activities are not included in the list of permissible activities for bank
holding companies contained in section 225.4(a) of
Regulation Y.
In determining whether an activity is permissible
under section 4(c)(8) of the Act, the Board first must
determine that the activity is "closely related to banking or managing or controlling banks." 2 In 1974, the
Board published for comment notice of proposed
rulemaking to add to the list of permissible bank
holding company activities, underwriting and dealing
in government securities and other obligations that a
state member bank may be authorized to underwrite or
deal in. 3 In orders dated October 20, 1976, and January 26, 1978, the Board determined that such activities are closely related to banking. The Board decided
not to add these activities to the list of permissible
activities,"however, but rather to consider applications
to engage in the activities on a case-by-case basis. The
Board found that these activities are closely related to
banking because national and state member banks are
expressly authorized by statute to engage in the activities (12 U . S . C . §§ 24 (Seventh), 335), and many banks
1. All banking data are as of December 31, 1982, unless otherwise
indicated.
2. See Board of Governors v. Investment Company Institute, 450
U.S. 46 (1981); National Courier Association v. Board of Governors,
516 F.2d 1229, (D.C. Cir. 1975).
3. 39 Federal Register 13007 (1974).
466
Federal Reserve Bulletin • June 1983
do engage in the activities. 4 The Board has reiterated
the view that underwriting and dealing in government
securities and other obligations as authorized by statute for state member banks is closely related to
banking in approving several applications to engage in
these activities. 5 The Board regards the government
securities activities in which Orbanco has proposed to
engage as substantially the same as those activities the
Board has approved in its previous orders.
In addition, Applicant proposes to underwrite and
deal in bankers acceptances, certificates of deposit,
and other money market instruments that state member banks may from time to time be authorized to
underwrite and deal in. 6 Banks are permitted to deal
in these money market instruments as an incident to
the activities expressly authorized by statute and a
number of banks currently serve as dealers in bankers
acceptances and certificates of deposit. 7 Thus, the
Board regards such activities as closely related to
banking because banks engage in such functions, and
the Board has approved such activities in a recent
order. 8
Before permitting a bank holding company to engage in a nonbanking activity, however, the Board also
must examine any public benefits that reasonably may
be expected to derive from bank holding company
performance of the activity and weigh them against
any possible adverse effects to determine whether the
activity is a proper incident to banking or managing or
controlling banks. Applicant's proposal represents a
corporate reorganization wherein, as noted above,
activities currently performed by its subsidiaries, The
Oregon Bank and the Northwest Acceptance Corporation, will be conducted by Orbanco Securities. Since
the proposal would result in a transfer of an activity
within the same corporate structure, approval of the
application would have no adverse competitive effects. In addition, the public will benefit from improvements in operational efficiency that will result from
implementation of this proposal.
The Board notes, however, that as a nonbank subsidiary of Applicant, Orbanco Securities would be
permitted to engage in underwriting and dealing in
4. 41 Federal
Register
47083 (1976); 43 Federal
Register
5382
(1978).
5 . Citicorp,
Oklahoma
68 FEDERAL RESERVE BULLETIN 2 4 9 (1982);
Bankshares,
( 1 9 7 9 ) ; United
Stepp,
Inc.,
Bancorp,
Inc.,
United
65 FEDERAL RESERVE BULLETIN 363
64 FEDERAL RESERVE BULLETIN 222 (1978);
6 4 FEDERAL RESERVE BULLETIN 2 2 3 (1978).
6. At present, Applicant proposes to deal in only bankers acceptances and certificates of deposit. These instruments are not regarded
as "securities" subject to the prohibitions in sections 16 and 21 of the
Glass-Steagall Act.
7. See "Comptroller's Handbook for National Bank Examiners", §
204; M. Stigum, "The Money Market: Myth, Reality and Practices,"
410 a n d 475 (1978).
8. Citicorp, supra.
government securities without being subject to many
of the restrictions that currently apply to a member
bank's conduct of these activities. The Board is concerned that the lack of restrictions on the proposed
activity might create the potential for unsound banking
practices. Accordingly, to obviate the possibility that
adverse effects would result from this proposal, the
Board expects that Orbanco Securities will conduct
the proposed activities subject to the same restrictions
and prudential limitations under which member banks
currently conduct such activities. 9 Any breach of
these restrictions by Orbanco Securities would constitute an unsafe or unsound practice that could be the
subject of formal supervisory action by the Board.
There is no evidence in the record that consummation
of the proposal would result in any other effects that
would be adverse to the public interest.
Based upon a consideration of all the relevant facts,
the Board concludes that the balance of the public
interest factors that the Board is required to consider
under section 4(c)(8) is favorable. Accordingly, the
application is hereby approved. This determination is
subject to the conditions set forth in section 225.4(c) of
Regulation Y and to the Board's authority to require
such modification or termination of the activities of a
bank holding company or any of its subsidiaries as the
Board finds necessary to assure compliance with the
provisions and purposes of the Act and the Board's
regulations and orders issued thereunder, or to prevent evasion thereof.
The transaction shall be made not later than three
months after the effective date of this Order, unless
such period is extended for good cause by the Board or
by the Federal Reserve Bank of San Francisco pursuant to delegated authority.
By order of the Board of Governors, effective
May 9, 1983.
Voting for this action: Vice Chairman Martin, and Governors Partee, Teeters, Rice, and Gramley. Absent and not
voting: Chairman Volcker and Governor Wallich.
JAMES M C A F E E ,
[SEAL!
Associate
Secretary
of the
Board
9. For example, member banks by statute are permitted to underwrite certain types of public housing and dormitory bonds of states
and municipalities, provided that the amount of such securities of a
single issuer held by the bank does not exceed ten percent of the
bank's capital and surplus. 12 U.S.C. § 24 (Seventh). Such securities
are designated "Type II" securities in regulations of the Comptroller
of the Currency. 12 C.F.R. § 1.3(a). (The regulations of the Comptroller of the Currency generally are applicable to state member banks.
See 12 U.S.C. § 335; 12 C.F.R. § 250.121.) Thus, Orbanco Securities
should not underwrite, deal in, or hold Type II securities by any issuer
in amounts that would not be permitted if such activities were
conducted by a member bank and should not sell securities to trust
accounts of affiliated banks except as permitted by the regulations of
the Comptroller of the Currency.
Legal Developments
Orders Under Section 3 and 4 of Bank
Holding Company Act
A61
Cedaredge Financial Services, Inc., Denver, Colorado, has applied for the Board's approval under sections 3(a)(1) and 4(c)(8) of the Bank Holding Company
Act (12 U . S . C . §§ 1842(a)(1) and 1843(c)(8)) to become
a bank holding company by acquiring The First National Bank of Cedaredge, Cedaredge, Colorado
("Bank"), and to c o m m e n c e general insurance agency
activities in Cedaredge, a town of less than 5,000
population.
Notice of the application, affording opportunity for
interested persons to submit comments and views, has
been given in accordance with sections 3(b) and 4(c)(8)
of the Act. The time for filing comments and views has
expired and the Board has considered the application
and all comments received in light of the factors set
forth in sections 3(c) and 4(c)(8) of the Act (12 U . S . C .
§§ 1842(c) and 1843(c)(8)).
Applicant is a nonoperating corporation organized
for the purpose of acquiring Bank, which holds deposits of $8.2 million. 1 U p o n acquisition of Bank, Applicant would control the 272nd largest banking organization in Colorado and less than 1 percent of the total
deposits in commercial banks in the state. 2
Bank is the 5th largest of 6 banks competing in the
Delta banking market 3 and holds approximately 6.0
percent of the total deposits in commercial banks in
that market. Although three of Applicant's principals
are associated with six other depository institutions in
Colorado and Wyoming, none of those other depository institutions competes in the Delta banking market. Since Applicant has no other subsidiaries, consummation of the proposed transaction would have no
adverse effect on competition or on the concentration
of banking resources in any relevant area. Thus, the
Board concludes that competitive considerations are
consistent with approval of the application.
Applicant's managerial and financial resources are
considered satisfactory, and its future prospects appear favorable, particularly in light of commitments by
Applicant's principals to maintain Bank's capital at
adequate levels. Applicant's principals have satisfactory records managing other banks, including Applicant's president, w h o will b e c o m e president of Bank
upon consummation of this proposal. It is anticipated
that affiliation with Applicant will result in improvements in Bank's overall operations. Thus, Bank's
financial and managerial resources and future prospects are consistent with approval. While Applicant
will incur debt in connection with this proposal, Applicant appears to have sufficient financial flexibility to
meet its debt servicing requirements while maintaining
Bank's capital at acceptable levels. Therefore, based
on these and other facts of record, the Board concludes that considerations relating to banking factors
lend weight for approval of the application.
Although consummation of the proposal would effect no immediate changes in the services offered by
Bank, considerations relating to the convenience and
needs of the community to be served are consistent
with approval of the application.
In connection with Applicant's proposal under section 4(c)(8) of the Act (12 U . S . C § 1843(c)(8)) to engage
de novo in general insurance activities, the Board has
concluded that consummation of this proposal can
reasonably be expected to produce significant public
benefits in the form of increased competition, efficiency, and convenience in the provision of insurance
services to the Cedaredge community, with no significant adverse effects. 4 Accordingly, the Board has
determined that consummation of the transaction
would be in the public interest and that the application
should be approved.
On the basis of the record, the application is approved for the reasons summarized above. This determination is subject to the conditions set forth in
section 225.4(c) of Regulation Y and the Board's
authority to require such modification or termination
of the activities of a holding company or any of its
subsidiaries as the Board finds necessary to assure
compliance with the provisions and purposes of the
Act and the Board's regulations and orders issued
thereunder, or to prevent evasion thereof.
The acquisition of Bank shall not be consummated
before the thirtieth calendar day following the effective
date of this Order and neither the acquisition of Bank
nor the commencement of general insurance agency
activities shall take place later than three months after
the effective date of this Order, unless such period is
1. Deposit data are as of December 31, 1982.
2. State and market shares and rankings are based on deposit data
as of December 31, 1981.
3. The Delta banking market is approximated by Delta County,
Colorado.
4. The Board's determination that general insurance agency activities in towns with populations not exceeding 5,000 are closely related
to banking (section 225.4(a)(9)(ii)) of Regulation Y (12 C.F.R.
§ 225.4(a)(9)(h)) was undisturbed by the Garn-St Germain Depository
Institutions Act of 1982. See Pub. L. 97-290, Title VI, § 601, 96 Stat.
1536 (October 15, 1982).
Cedaredge Financial Services, Inc.,
Denver, Colorado
Order Approving Formation of a Bank Holding
Company and Commencement
of General
Insurance
Agency
Activities
468
Federal Reserve Bulletin • June 1983
extended for good cause by the Board or by the
Federal Reserve Bank of Kansas City pursuant to
delegated authority.
By order of the Board of Governors, effective
May 31, 1983.
Voting for this action: Chairman Volcker and Governors
Martin, Wallich, Partee, Rice, and Gramley. Absent and not
voting: Governor Teeters. Governor Wallich abstained from
voting on the application to engage in insurance agency
activities.
JAMES M C A F E E ,
[SEAL]
Associate
Secretary
of the
Board
InterFirst Corporation,
Dallas, Texas
The Board's Order approving
the merger of bank
holding companies and the acquisition of companies
engaged in insurance and data processing
activities
was published in the Federal Reserve Bulletin at page
383 of the issue for May 1983. The following is the
dissenting statement of Governor
Teeters.
Dissenting
Statement
of Governor
Teeters
I would deny this application because the combination
of these two large bank holding companies will have a
significant adverse effect on the concentration of banking resources in the state of Texas, on existing competition in the Dallas-Fort Worth banking market, and on
probable future competition in the Tyler, Victoria, and
Wichita Falls banking markets.
The original language in § 3(c) of the Bank Holding
Company Act ( " B H C Act") set forth five separate
factors for the Board to consider when reviewing a
bank holding company acquisition of a bank: financial
aspects, future prospects, the character of management, convenience, needs and welfare of the community, and "whether or not the effect of [the] acquisition
. . . would be to expand the size or extent of the bank
holding company system involved beyond limits consistent with adequate and sound banking, the public
interest, and the preservation of competition in the
field of banking." 1
The competitive standard in the 1956 BHC Act is
broad and the legislative history of the B H C Act
indicates that Congress designed it to control the
growth of bank holding companies, to protect and
foster "the growth of independent unit banks," and to
prevent the "undue concentration of control of bank-
1. § 3(c), ch. 240, 70 Stat. 135 (1956).
ing activities." 2 Under the 1956 B H C Act, the Board
denied a number of bank holding company proposals
on the basis that they would have significant adverse
effects on state banking structure or statewide concentration of resources. Three such Board denials were
unheld by courts in the early 1960's. 3
The legislative history of the 1966 Amendments to
the B H C Act, which altered the text of § 3(c) to its
present form, indicates only that the B H C Act was
being amended to conform it to the Bank Merger Act
of 1966. 4 The legislative history of the 1966 Amendments to the Bank Merger Act is, therefore, relevant
to consideration of the 1966 B H C Act Amendments.
The legislative history of the 1966 Bank Merger Act
indicates that the amendments were merely a "rephrasing" of the language concerning the banking
factors in the 1960 Bank Merger Act 5 and were not
intended to limit the agencies' authority or responsibility to consider all the factors previously relevant under
the 1960 Act. Under the Bank Merger Act of
1960 an agency could approve a merger only if the
agency found that the merger was in the public interest. The legislative history of the 1960 Bank Merger
Act indicates the agencies were to consider "any
lessening of competition . . . whether appreciable,
perceptible, slight, substantial, serious or great . . ." 6
The House Report on the 1966 Bank Merger Act
stated:
Of course, the expression of these factors in the
statute would not preclude the agencies, charged as
they are with general supervisory responsibility, from
considering in any particular case, such other factors
as they may deem relevant. 7
In 1966, Congress was concerned with the increasing number of bank mergers. This concern is evidenced by statements that the agencies "had been
2. H. Rep. No. 609, 84th Cong. 1st Sess. 1-2 (1955); S. Rep. No.
1095, 84th Cong. 1st Sess 10 (1955).
3. First Wisconsin Bankshares v. Board of Governors, 325 F.2d 946
(7th Cir. 1963); Marine Bancorp v. Board of Governors, 325 F.2d 967
(7th Cir. 1963); Northwest Bancorp v. Board of Governors, 303 F.2d
832, 842 (8th Cir. 1962). In Northwest, the Eighth Circuit stated that
the BHC Act required the Board to view "the structure of the entire
industry of banking." At that time, the Supreme Court had provided
only limited guidance as to the meaning of the antitrust standard in § 7
of the Clayton Act.
4. 112 Cong. Rec. 12384 (1966) (remarks of Sen. Robertson).
5. H. Rep. No. 1221 , 89th Cong. 2d Sess. 4 (1966).
6. H. Rep. No. 1416, 86th Cong. 2d Sess. 10 (1960).
7. H. Rep. No. 1221 supra at 4. Also see Remarks of Sen.
Robertson, Chairman of the Senate Banking Committee:
"The bill means that all the factors which the regulatory agencies
presently consider under the Bank Merger Act are still relevant as
are, of course, the factors set out in the final paragraph of (section
3(c)). 112 Cong. Rec. 2663 (1966).
Legal Developments
more liberal in granting approvals" and that the Bank
Merger Act was intended "to make bank mergers
more difficult, not easier." 112 Cong. Rec. 2444 (1966)
(Remarks of Cong. Reuss). 8 Based upon the legislative history, the 1966 amendments to the Bank Merger
Act and the B H C Act, therefore, could not possibly
have been intended to narrow the powers of the
regulatory agencies to scrutinize competitive factors in
a merger or acquisition. In my opinion, the Board
continues to be responsible, under the B H C Act, for
considering the effect on state structure and concentration of resources within a state of a merger or
consolidation of large competitors in a state.
Under the standards as set out in the statutes and
clarified by the legislative history, it is clear that the
combination of the two bank holding companies in this
case will substantially lessen competition in commercial banking within the state of Texas. InterFirst is the
largest banking organization in the state and controls
11.56 percent of total deposits in commercial banks in
the state. First United is the tenth largest banking
organization in the state and controls 1.52 percent of
total deposits in commercial banks in the state. First
United is a strong competitor in Texas and has shown
the ability to expand beyond its home market and is
the largest competitor in Fort Worth, the third largest
market in the state. In my opinion, elimination of First
United as a competitor will substantially lessen competition in Texas.
Approval will also accelerate a disturbing trend
toward concentration of banking resources in Texas.
Upon consummation of this proposal, the four largest
banking organizations in Texas will control 41.95
percent 9 of the total deposits in commercial banks in
the state. This represents an increase of approximately
10 percentage points since 1980, when the four-firm
concentration ratio was only 32.44 percent. 1 0 The
Supreme Court stated in Brown Shoe Co. v. United
States, 370 U . S . 294, 317 (1961) that agencies have
authority to arrest mergers at a time when the trend to
a lessening of competition in a line of commerce is in
its incipiency. I believe that such a trend is present in
Texas and that denial of this application would "brake
this force at its outset and before it gather(s) momentum." 370 U . S . at 318.
Further, I believe that Fort Worth and Dallas have
combined into a single banking market. The evidence
of record shows that in the last ten years, economic
8. Accord. 112 Cong. Rec. 2441, 2451, 2442, 2443 (1966) (Remarks
of Cong. Patman, Minish, Widnall, and Multner, respectively); also S.
Rep. No. 1179, 89th Cong. 2d Sess. 11 (1966).
9. This figure reflects deposit data as of June 30, 1982 and bank
holding company formations and acquisitions approved as of
March 31, 1983.
10. This figure reflects deposit data as of June 30, 1980.
469
and demographic changes in the Dallas-Fort Worth
metropolis, particularly in the mid-cities area, have
resulted in a merging of the Dallas and Fort Worth
banking markets. 11 When the merger is reviewed in the
context of a combined Dallas-Fort Worth market, it
would result in a combination of the largest and fifth
largest competitors in that market, and produce a firm
that controls over 28 percent of the total deposits in
commercial market. Such a merger would substantially lessen existing competition in the market.
Even if Dallas and Fort Worth are considered to be
separate banking markets, approval of this application
would have a substantial adverse competitive effect in
the Dallas banking market that would warrant denial.
Applicant's lead bank is located in Dallas and is the
largest banking organization in the market holding 29.9
percent of the total deposits in commercial banks in
the market. First United's subsidiary in the Dallas
market is the sixteenth largest banking organization in
the market, and holds 0.4 percent of the total deposits
in commercial banks in the market. In view of Applicant's dominant position in the market and the market's highly concentrated structure (pre-merger HHI
of 1874), it is my opinion that this merger would have a
substantial adverse effect on competition in the Dallas
market and should be denied.
Finally, I would deny this application on the
grounds that the combination of these bank holding
companies would have a significant adverse effect on
probable future competition in the Fort Worth (if that
market were considered as a separate market from
Dallas), Tyler, Victoria, and Wichita Falls banking
markets. Applicant clearly is a likely future entrant
into the Fort Worth market because Applicant already
had established a de novo bank in Fort Worth that it
divested in anticipation of this merger. Approval of the
application eliminates the probability that Applicant
would make a procompetitive de n o v o or foothold
acquisition in the Fort Worth market, a result that in
my view is substantially anticompetitive. In addition,
in view of First United's size and history of expansion,
I believe that First United is likely to enter the
remaining three markets on a de novo or foothold
basis. In light of the high concentration of banking
resources in these markets, the elimination of First
United as a probable future entrant is substantially
anticompetitive.
11. This change is reflected in the growing importance of the
regional airport which serves both cities and straddles Tarrant and
Dallas County and the combination of Dallas and Forth Worth into
one SMSA.
Although it is 30 miles from center-city Dallas to center-city Fort
Worth, the distance between the city limits is far smaller. It is also
important to note that in a state the size of Texas, 30 miles is a less
significant distance than it might be in a smaller, Eastern state.
470
Federal Reserve Bulletin • June 1983
The Board has p r o p o s e d guidelines regarding probable future competition as a method of addressing the
standards set out by the United States Court of
Appeals for the Fifth Circuit in Mercantile
Texas
Corporation
v. Board of Governors, 638 F. 2d 1255 (5th
Cir. 1981). A s I have previously indicated, these
guidelines will be difficult to enforce. T o d a y ' s action in
T e x a s reaffirms my belief that the guidelines, as prop o s e d , permit combinations of bank holding compaORDERS
APPROVED
By the Board of
UNDER
BANK
HOLDING
nies that h a v e substantially anticompetitive c o n s e quences.
I believe the Board should d e v e l o p and apply standards that more realistically reflect the adverse effects
of the elimination of probable future competition.
Accordingly, I dissent f r o m the Board's decision to
approve this application.
April 20, 1983
COMPANY
ACT
Governors
During May 1983, the Board of Governors approved the applications listed b e l o w . Copies are available upon
request to Publications S e r v i c e s , Division of Support Services, Board of Governors of the Federal R e s e r v e
S y s t e m , Washington, D . C . 20551.
Section 3
Board action
(effective
date)
Applicant
Bank(s)
First Bankshares, Inc.,
Barboursville, W e s t Virginia
First National Bankshares, Inc.,
Stuart, Florida
The Manila Banking Corporation,
Manila Philippines
Mercantile Bankshares Corporation,
Baltimore, Maryland
Merchants B a n c s h a r e s , Inc.,
Kenner, Louisiana
Shawsville Bancorp, Inc.,
Shawsville, Virginia
Tennessee Homestead Company,
Ogden, Utah
W o o d County Bancorporation, Inc.,
Washington, D . C .
The First State Bank,
Barboursville, West Virginia
First National Bank and Trust C o m p a n y ,
Stuart, Florida
Manilabank California,
L o s A n g e l e s , California
County Banking and Trust C o m p a n y ,
Elkton, Maryland
Merchants Trust & Savings Bank,
Kenner, Louisiana
Bank of Shawsville,
Shawsville, Virginia
Bank of Utah,
Ogden, Utah
W o o d County Bank,
Parkersburg, West Virginia
By Federal Reserve
May 17, 1983
May 16, 1983
May 23, 1983
May 13, 1983
May 2, 1983
May 10, 1983
May 9, 1983
May 24, 1983
Banks
Recent applications have been approved by the Federal Reserve Banks as listed below. Copies of the orders are
available upon request to the Reserve Banks.
Section 3
Applicant
American Bancshares Holding Corp.
Shreveport, Louisiana
American National Bancshares, Inc.,
Baxter Springs, Kansas
Bank(s)
American Bank & Trust Company,
Shreveport, Louisiana
American National Bank,
Baxter Springs, Kansas
Reserve
Bank
Effective
date
Dallas
May 9, 1983
Kansas City
May 5, 1983
Legal Developments
471
Section 3—Continued
Applicant
Andrews Financial Corporation,
Andrews, Texas
Ardmore Bancshares, Inc.,
Ardmore, Tennessee
Ashley Bancstock Company,
Crossett, Arkansas
Baileyville Bancshares, Inc.,
Baileyville, Kansas
BancUnion Corp.,
Lancaster, Wisconsin
Belmont Bancorp,
Bridgeport, Ohio
Burns Bancorporation, Inc.,
St. Paul, Minnesota
CB&T Bancshares, Inc.,
Columbia, Georgia
Century State Bancshares, Inc.,
Columbia, Missouri
CharterCorp,
Kansas City, Missouri
Citizens Union Bancorp, Inc.,
Rogersville, Tennessee
Clear Lake Bancorp, Inc.,
Clear Lake, Wisconsin
Collier Bancshares Holding Company,
Inc.,
McAllen, Texas
Commercial BancShares, Inc.,
Parkersburg, West Virginia
Commercial State Bancorp, Inc.,
Houston, Texas
Community Bancorp, Inc.,
Manchester, Missouri
Cottage Grove BanCorporation, Inc.,
St. Paul, Minnesota
D'Arbonne Bancshares, Inc.,
Farmers ville, Louisiana
Eagan BanCorporation, Inc.,
St. Paul. Minnesota
Bank(s)
First National Bank of Hamilton,
Hamilton, Texas
Bank of Ardmore,
Ardmore, Tennessee
First National Bank of Crossett,
Crossett, Arkansas
Baileyville State Bank,
Baileyville, Kansas
Union Bank & Trust,
Lancaster, Wisconsin
Belmont County National Bank,
St. Clairsville, Ohio
Burns National Bank of Durango,
Durango, Colorado
West Georgia Financial Corporation,
Tallapoosa, Georgia
Carroll County Financial Corporation,
Temple, Georgia
Century State Bank,
Columbia, Missouri
Thornton, Bank,
Nevada, Missouri
Citizens Union Bank,
Rogersville, Tennessee
Bank of Clear Lake,
Clear Lake, Wisconsin
Lower Rio Grande Valley
Bancshares, Inc.,
La Feria, Texas
The First National Bank of La Feria,
La Feria, Texas
The First National Bank of Mercedes,
Mercedes, Texas
Valley National Bank,
Harlingen, Texas
Commercial Banking and Trust
Company,
Parkersburg, West Virginia
Commercial State Bancshares, Inc.,
Houston, Texas
Bank Bismarck,
Bismarck, Missouri
Minnesota National Bank of
Cottage Grove,
Cottage Grove, Minnesota
The D'Arbonne Bank and Trust
Company,
Farmers ville, Louisiana
Minnesota National Bank of Eagan,
Eagan, Minnesota
Reserve
Bank
Effective
date
Dallas
April 21, 1983
Atlanta
April 22, 1983
St. Louis
May 3, 1983
Kansas City
April 29, 1983
Chicago
April 25, 1983
Cleveland
May 20, 1983
Kansas City
April 28, 1983
Atlanta
April 26, 1983
St. Louis
May 20, 1983
Kansas City
April 19, 1983
Atlanta
April 29, 1983
Minneapolis
May 20, 1983
Dallas
April 22, 1983
Richmond
April 29, 1983
Dallas
May 6, 1983
St. Louis
April 22, 1983
Minneapolis
April 22, 1983
Dallas
May 12, 1983
472
Federal Reserve Bulletin • June 1983
Section 3—Continued
Applicant
Elmore Bancshares, Inc.,
Elmore, Minnesota
F&M Bancshares, Inc.,
Leslie, Georgia
Farmers Bancshares, Inc.,
Malone, Florida
Financial Properties, Inc.,
Jacksonville, Arkansas
First American Corporation of
Colorado Springs,
St. Paul, Minnesota
First and Farmers Bancshares, Inc.,
Somerset, Kentucky
First Bancorp of Belleville, Inc.,
Belleville, Illinois
First Illinois Corporation,
Evanston, Illinois
First Newport Bancshares, Inc.,
Newport, Arkansas
First Rockwall Bancshares, Inc.,
Rockwall, Texas
First State Bancorp, Inc.,
Marion, Indiana
Forstrom Bancorporation, Inc.,
Clara City, Minnesota
GGB Bancshares, Inc.,
Sheridan, Arkansas
Gresham Bancshares, Inc.,
Gresham, Wisconsin
Hamburg Financial, Inc.,
Edina, Minnesota
Independence Bancorp, Inc.,
Perkasie, Pennsylvania
JAW Bancshares Corp.,
Stanhope, Iowa
Jena Holding Company,
N e w Orleans, Louisiana
L B O Bancorp, Inc.,
West Monroe, Louisiana
Lake Valley Bancorp, Inc.,
Taylorsville, Kentucky
Linn Holding Company,
Linn, Missouri
Madison Agency Inc.,
Madison, Minnesota
Merchants Trust, Inc.,
Jackson, Alabama
Bank(s)
First National Bank of Elmore,
Elmore, Minnesota
Farmers & Merchants Bank,
Leslie, Georgia
The Farmers Bank of Malone,
Malone, Florida
Citizens National Bank of Jacksonville,
Jacksonville, Arkansas
American Heritage Corporation,
St. Paul, Minnesota
First and Farmers Bank of Somerset,
Somerset, Kentucky
Fairview Heights Community Bank,
Fairview Heights, Illinois
The Wilmette Bank,
Wilmette, Illinois
The First State Bank of Newport,
Newport, Arkansas
The First State Bank,
Rockwall, Texas
First State Bank of Dunkirk,
Dunkirk, Indiana
Citizens State Bank of Clara City,
Clara City, Minnesota
Grant County Bank,
Sheridan, Arkansas
State Bank,
Gresham, Wisconsin
State Bank of Hamburg,
Hamburg, Minnesota
Union Bank and Trust Company of
Eastern Pennsylvania,
Bethlehem, Pennsylvania
Cheltenham Corporation,
Cheltenham, Pennsylvania
Farmers State Bank,
Stanhope, Iowa
LaSalle Bancshares, Inc.,
Jena, Louisiana
Louisiana Bank of Ouachita Parish,
West Monroe, Louisiana
The Peoples Bank,
Taylorsville, Kentucky
Linn State Bank,
Linn, Missouri
Sanborn State Bank,
Sanborn, Minnesota
Merchants Bank,
Jackson, Alabama
Reserve
Bank
Effective
date
Minneapolis
April 29, 1983
Atlanta
April 29, 1983
Atlanta
May 23, 1983
St. Louis
May 5, 1983
Kansas City
April 21, 1983
Cleveland
May 23, 1983
St. Louis
April 22, 1983
Chicago
May 18, 1983
St. Louis
April 28, 1983
Dallas
May 13, 1983
Chicago
May 20, 1983
Minneapolis
May 12, 1983
St. Louis
April 22, 1983
Chicago
May 3, 1983
Minneapolis
May 6, 1983
Philadelphia
May 19, 1983
Chicago
April 29, 1983
Dallas
May 18, 1983
Dallas
April 20, 1983
St. Louis
May 9, 1983
St. Louis
May 2, 1983
Minneapolis
May 12, 1983
Atlanta
May 4, 1983
Legal Developments
473
Section 3—Continued
Applicant
Missouri Farmers Bancshares, Inc.,
Maitland, Missouri
Newton Financial Corporation,
Newton, N e w Jersey
North East Bancshares, Inc.,
Henagar, Alabama
Northway Bancshares, Inc.,
Richardson, Texas
Oakland City Bancshares Corp.,
Oakland City, Indiana
One Valley Bancorp of West Virginia,
Inc.,
Charleston, West Virginia
Planters Financial Corporation,
Hopkinsville, Kentucky
Rosedale First National Corp.,
Rosedale, Mississippi
Roseville Bancorp., Inc.,
Roseville, Minnesota
Security Financial Corp.,
Starkville, Mississippi
St. Charles Bancshares, Inc.,
St. Charles, Minnesota
St. James Bancorporation, Inc.,
Lutcher, Louisiana
State National Corporation,
Evanston, Illinois
Stillwater Holding Company,
Stillwater, Minnesota
Tennessee Eastern Bancshares, Inc.,
Oak Ridge, Tennessee
Terry Bancorporation,
Walford, Iowa
Texas Southwest Bancorp, Inc.,
Mesquite, Texas
Trans Kentucky Bancorp,
Pike ville, Kentucky
Tritten Bancshares, Inc.,
St. Robert, Missouri
Union Illinois Company,
East St. Louis, Illinois
Union National Corporation,
Mt. Lebanon, Pennsylvania
Bank(s)
Maitland Bancshares, Inc.,
Maitland, Missouri
The Newton Trust Company,
Newton, N e w Jersey
Northeast State Bank of Alabama,
Henagar, Alabama
Richardson National Bank,
Richardson, Texas
Northway National Bank,
Addison, Texas
First Bank and Trust Company of
Oakland City,
Oakland City, Indiana
Security Bank of Huntington,
Huntington, West Virginia
Planters Bank & Trust Company,
Hopkins ville, Kentucky
First National Bank,
Rosedale, Mississippi
Mid America National Bank of
Roseville,
Roseville, Minnesota
Security State Bank,
Starkville, Mississippi
First National Bank of Stewartville,
Stewartville, Minnesota
St. James Bank and Trust Company,
Lutcher, Louisiana
The Bank & Trust Company of
Arlington Heights,
Arlington Heights, Illinois
First State Bank of Hugo,
Hugo, Minnesota
Bank of Oak Ridge,
Oak Ridge, Tennessee
Farmers Savings Bank,
Walford, Iowa
Southwest Bank,
Mesquite, Texas
The Citizens Bank of Pikeville,
Pikeville, Kentucky
The First National Bank,
St. Robert, Missouri
The State Bank of Jersey ville,
Jersey ville, Illinois
The McDowell National Bank of
Sharon,
Sharon, Pennsylvania
Reserve
Bank
Effective
date
Kansas City
May 3, 1983
N e w York
May 3, 1983
Atlanta
May 20, 1983
Dallas
May 23, 1983
St. Louis
April 22, 1983
Richmond
May 20, 1983
St. Louis
May 20, 1983
St. Louis
May 6, 1983
Minneapolis
May 13, 1983
St. Louis
April 25, 1983
Minneapolis
May 4, 1983
Atlanta
May 6, 1983
Chicago
April 28, 1983
Minneapolis
May 16, 1983
Atlanta
April 19, 1983
Chicago
May 3, 1983
Dallas
April 29, 1983
Cleveland
May 16, 1983
St. Louis
May 9, 1983
St. Louis
May 17, 1983
Cleveland
May 17, 1983
474
Federal Reserve Bulletin • June 1983
Section 3—Continued
Applicant
Reserve
Bank
Bank(s)
United Bankers, Inc.,
Waco, Texas
Uvalde Bancshares, Inc.,
Uvalde, Texas
Walz-Stuart Agency, Inc.,
St. Paul, Minnesota
Whitmore Company, Inc.,
Corning, Iowa
Yukon Temporary Holding Company,
Yukon, Oklahoma
Farmers State Bank of Madisonville,
Texas,
Madisonville, Texas
The Uvalde Bank,
Uvalde, Texas
First Sierra National Bank,
Truth or Consequences,
N e w Mexico
Whitmore Bancorporation, Inc.,
Corning, Iowa
First Yukon Bancshares, Inc.,
Yukon, Oklahoma
Effective
date
Dallas
April 28, 1983
Dallas
May 20, 1983
Dallas
May 20, 1983
Chicago
April 29, 1983
Kansas City
May 9, 1983
Section 4
Applicant
Bent Tree Bancshares, Inc.,
Dallas, Texas
Goodenow Bancorporation,
Wall Lake, Iowa
First Interstate Bancorp,
Los Angeles, California
Zions Utah Bancorporation,
Salt Lake City, Utah
Nonbanking
company
Reserve
Bank
Bent Tree Mortgage, Inc.,
Dallas, Texas
Franck and Goodenow Insurance
Agency,
Wall Lake, Iowa
general insurance business
Spoor, Behrins, Campbell & Young,
N e w York, N e w York
Republic Industrial Bank,
Widefield, Colorado
Effective
date
Dallas
April 21, 1983
Chicago
May 3, 1983
San Francisco
May 12, 1983
San Francisco
May 19, 1983
Sections 3 and 4
Bank(s)/Nonbanking
company or activity
Martinius Corporation,
Rogers, Minnesota
State Bank of Rogers,
Rogers, Minnesota
to engage in general
insurance activities
Reserve
Bank
Minneapolis
Effective
date
May 17, 1983
Legal Developments
ORDERS
APPROVED
By Board of
UNDER
BANK
MERGER
475
ACT
Governors
Applicant
Bank(s)
H e m p s t e a d Bank,
H e m p s t e a d , N e w York
Island State Bank,
Patchogue, N e w York
Peninsula National Bank,
Cedarhurst, N e w York
By Federal Reserve
Effective
M a y 13, 1983
Banks
.
Applicant
n
w ^
Bank(s)
Reserve
B a n k
Effective
^
Bank of W e s t Point,
W e s t Point, Virginia
Citizens Bank,
Sheboygan, Wisconsin
First Settlers Bank,
H a y e s , Virginia
Citizens N o r t h Side Bank,
Sheboygan, W i s c o n s i n
Richmond
April 29, 1983
Chicago
April 27, 1983
PENDING
CASES
INVOLVING
THE BOARD
OF
This list of pending
cases does not include
against the Federal Reserve Banks in which the
of Governors
is not named a party.
GOVERNORS
suits
Board
Jet Courier Services,
Inc., et al. v. Federal
Reserve
Bank of Atlanta,
et al., filed February 1983,
U . S . C . A . for the Sixth Circuit.
Securities
Industry Association
v. Board of Governors, et al., filed February 1983, U . S . C . A . for the
S e c o n d Circuit.
Flagship Banks, Inc. v. Board of Governors,
filed
January 1983, U . S . D . C . for the District of Columbia.
Flagship Banks, Inc. v. Board of Governors,
filed
October 1982, U . S . D . C . for the District of Columbia.
Hayton v. State of Utah, et al., filed September 1982,
U . S . D . C . for the District of Utah.
Association
of Data Processing
Service
Organizations, Inc., et al. v. Board of Governors,
filed
August 1982, U . S . C . A . for the District of Columbia.
Bowler v. Treasurer of the U.S., et al, filed July 1982,
U . S . C . A . for the First Circuit.
The Philadelphia
Clearing House Association,
et al. v.
Board of Governors, filed July 1982, U . S . D . C . for
the Eastern District of Pennsylvania.
Richter v. Board of Governors,
et al., filed May 1982,
U . S . D . C . for the Northern District of Illinois.
Wyoming Bancorporation
v . Board of Governors,
filed
M a y 1982, U . S . C . A . for the Tenth Circuit.
First Bancorporation
v. Board of Governors,
filed
April 1982, U . S . C . A . for the Tenth Circuit.
Charles G. Vick v . Paul A. Volcker, et al., filed March
1982, U . S . D . C . for the District of Columbia.
Jolene Gustafson v . Board of Governors, filed March
1982, U . S . C . A . for the Fifth Circuit.
Edwin F. Gordon v. Board of Governors,
et al., filed
October 1981, U . S . C . A . for the E l e v e n t h Circuit
(two consolidated c a s e s ) .
Allen Wolfson v. Board of Governors, filed S e p t e m b e r
1981, U . S . D . C . for the Middle District of Florida.
Bank Stationers
Association,
Inc., et al. v. Board of
Governors, filed July 1981, U . S . D . C . for the Northern District of Georgia.
Public Interest Bounty Hunters v. Board of Governors, et al., filed June 1981, U . S . D . C . for the
Northern District of Georgia.
First Bank & Trust Company v. Board of
Governors,
filed February 1981, U . S . D . C . for the Eastern District of K e n t u c k y .
9 to 5 Organization
for Women Office Workers v.
Board
of Governors,
f i l e d D e c e m b e r 1980,
U . S . D . C . for the District of M a s s a c h u s e t t s .
Securities
Industry Association
v. Board of Governors, et al., filed October 1980, U . S . C . A . for the
District of Columbia.
A. G. Becker, Inc. v. Board of Governors,
et al., filed
October 1980, U . S . C . A . for the District of Columbia.
A. G. Becker, Inc. v. Board of Governors,
et al., filed
August 1980, U . S . C . A . for the District of Columbia.
Berkovitz,
et al. v . Government
of Iran, et al., filed
June 1980, U . S . D . C . for the Northern District of
California.
A1
Financial and Business Statistics
CONTENTS
Domestic
A3
A4
A5
A6
Financial
Statistics
Monetary aggregates and interest rates
R e s e r v e s of depository institutions, R e s e r v e
Bank credit
R e s e r v e s and borrowings of depository
institutions
Federal funds and repurchase agreements of
large m e m b e r banks
POLICY
Federal R e s e r v e Bank interest rates
R e s e r v e requirements of depository institutions
M a x i m u m interest rates payable o n time and
savings deposits at federally insured institutions
A l l Federal R e s e r v e o p e n market transactions
RESERVE
BANKS
A 1 2 Condition and Federal R e s e r v e note statements
A13 Maturity distribution of loan and security
holdings
BANKS
A s s e t s and liabilities
A20
All reporting banks
A21
Banks with a s s e t s of $1 billion or more
A22
Banks in N e w York City
A23
Balance sheet memoranda
A24
Branches and agencies of foreign banks
A24
Commercial and industrial loans
A25 Gross demand deposits of individuals,
partnerships, and corporations
FINANCIAL
AND CREDIT
BANKING
INSTITUTIONS
A18 Major nondeposit funds
A 1 9 A s s e t s and liabilities, last W e d n e s d a y - o f - m o n t h
series
FINANCE
AGGREGATES
A 1 4 Aggregate r e s e r v e s of depository institutions
and monetary b a s e
A15 M o n e y stock m e a s u r e s and c o m p o n e n t s
A 1 6 Bank debits and deposit turnover
A17 L o a n s and securities of all commercial banks
COMMERCIAL
MARKETS
A26 Commercial paper and bankers dollar
a c c e p t a n c e s outstanding
A26 Prime rate charged by banks o n short-term
business loans
A27 Terms of lending at commercial banks
A28 Interest rates in m o n e y and capital markets
A29 Stock m a r k e t — S e l e c t e d statistics
A 3 0 Selected financial institutions—Selected a s s e t s
and liabilities
FEDERAL
MONETARY
COMMERCIAL
INSTRUMENTS
A7
A8
A9
FEDERAL
WEEKLY REPORTING
A31
A32
A33
A33
Federal fiscal and financing operations
U . S . Budget receipts and outlays
Federal debt subject t o statutory limitation
Gross public debt of U . S . T r e a s u r y — T y p e s and
ownership
A 3 4 U . S . g o v e r n m e n t securities dealers—
Transactions, positions, and financing
A35 Federal and federally s p o n s o r e d credit
a g e n c i e s — D e b t outstanding
85
Federal Reserve Bulletin • June 1983
SECURITIES MARKETS AND
CORPORATE
FINANCE
International
A 3 6 N e w security i s s u e s — S t a t e and local
governments and corporations
A 3 7 Open-end investment c o m p a n i e s — N e t sales and
asset position
A 3 7 Corporate profits and their distribution
A38 Nonfinancial c o r p o r a t i o n s — A s s e t s and
liabilities
A38 Total nonfarm b u s i n e s s expenditures o n n e w
plant and equipment
A 3 9 D o m e s t i c finance c o m p a n i e s — A s s e t s and
liabilities and b u s i n e s s credit
REAL
A 4 0 Mortgage markets
A41 Mortgage debt outstanding
INSTALLMENT
CREDIT
A42 Total outstanding and net change
A43 Terms
FLOW OF
FUNDS
Nonfinancial
Statistics
A 4 6 Nonfinancial b u s i n e s s activity—Selected
measures
A 4 6 Output, capacity, and capacity utilization
A 4 7 Labor force, e m p l o y m e n t , and u n e m p l o y m e n t
A48 Industrial p r o d u c t i o n — I n d e x e s and gross value
A 5 0 H o u s i n g and construction
A51 C o n s u m e r and producer prices
A 5 2 Gross national product and i n c o m e
A53 Personal i n c o m e and saving
U . S . international transactions—Summary
U . S . foreign trade
U . S . reserve a s s e t s
Foreign official a s s e t s held at Federal R e s e r v e
Banks
A 5 6 Foreign branches of U . S . b a n k s — B a l a n c e sheet
data
A58 S e l e c t e d U . S . liabilities to foreign official
institutions
REPORTED
BY BANKS
IN THE UNITED
STATES
Liabilities to and claims on foreigners
Liabilities to foreigners
Banks' o w n claims o n foreigners
Banks' o w n and d o m e s t i c customers' claims on
foreigners
A 6 2 Banks' o w n claims o n unaffiliated foreigners
A63 Claims o n foreign countries—Combined
domestic offices and foreign branches
REPORTED BY NONBANKING
ENTERPRISES
IN THE UNITED
BUSINESS
STATES
A 6 4 Liabilities to unaffiliated foreigners
A65 Claims o n unaffiliated foreigners
A 4 4 Funds raised in U . S . credit markets
A45 Direct and indirect sources of funds to credit
markets
Domestic
A54
A55
A55
A55
A58
A59
A61
A62
ESTATE
CONSUMER
Statistics
SECURITIES
HOLDINGS
AND
TRANSACTIONS
A 6 6 Foreign transactions in securities
A67 Marketable U . S . Treasury bonds and n o t e s —
Foreign holdings and transactions
INTEREST
AND EXCHANGE
RATES
A67 D i s c o u n t rates of foreign central banks
A68 Foreign short-term interest rates
A68 Foreign e x c h a n g e rates
A69 Guide to Tabular
Statistical Releases,
Tables
Presentation,
and Special
Domestic Financial Statistics
1.10
A3
MONETARY AGGREGATES AND INTEREST RATES
Monetary and credit aggregates
(annual rates of change, seasonally adjusted in percent)1
Item
1982
Q2
1
2
3
4
Reserves of depository institutions
Total
Required
Nonborrowed
Monetary base2
3
6
7
8
Concepts of money and liquid assets3
Ml
M2
M3
L
Time and savings deposits
Commercial banks
9 Total 4
10 Savings
11 Small-denomination time56
12 Large-denomination
time
13 Thrift institutions7
14 Total loans and securities at commercial banks8
Q3
Q4
1983
1982
Ql
Dec.
1983
Jan.
Feb.
Mar.
Apr.
4.8
5.3'
8.5
7.7
5.1
4.9
11.5
6.8
11.0'
10.1
12.7
8.0
1.1
.8
.6
8.6
11.1
8.3
10.9
8.7
-19.5'
-21.2
-16.7
4.7
6.6'
10.2
5.1
11.4
19.7
20.0
13.7
15.0
8.8
7.6
2.6
6.9
3.2
7.0
8.5'
10.5
6.1
10.9
12.5
12.1
13.1
9.3
9.5
8.8
14.1
20.3
10.2
n.a.
10.6
8.9'
3.7'
6.7
9.8
30.9
13.0
n.a.
22.4
24.4
13.6
n.a.
15.9
11.2
8.2
n.a.
-2.7
2.8
4.3
n.a.
13.4'
-1.7'
-17.0'
17.0
4.1
18.2
-1.8
18.7
26.8
6.5'
3.2
13.4
-.5
-6.8
6.2
12.4
-43.4
-48.5
-58.5
12.1
5.8
-20.2
-18.5
-44.3
4.1
27.9
-85.9
-83.0
-97.1
10.8
8.8
-55.4
-63.9
-60.9
21.3'
2.9
-19.9
-38.7
-27.7
17.2
6.8
-12.6
-19.5
.8
17.1
-6.7
6.0
5.5
9.8
10.5
12.8
7.6
11.2
8.7
Interest rates (levels, percent per annum)
Q2
15
16
17
18
Short-term rates
Federal funds9
Discount window borrowing10
Treasury bills (3-month market1112
yield)
Commercial paper (3-month)
....
19
20
21
22
Long-term rates
Bonds
U.S. government13
State and local government14
Aaa utility (new issue)'
Conventional mortgages
14.52
12.00
11.01
12.42
13.81
10.83
9.32
11.15
13.74
12.33
15.73
16.63
12.94
11.39
14.25
15.65
1. Unless otherwise noted, rates of change are calculated from average
amounts outstanding in preceding month or quarter.
2. Includes reserve balances at Federal Reserve Banks in the current week
plus vault cash held two weeks earlier used to satisfy reserve requirements at all
depository institutions plus currency outside the U.S. Treasury, Federal Reserve
Banks, the vaults of depository institutions, and surplus vault cash at depository
institutions.
3. Ml: Averages of daily figures for (1) currency outside the Treasury, Federal
Reserve Banks, and the vaults of commercial banks; (2) traveler's checks of
nonbank issuers; (3) demand deposits at all commercial banks other than those
due to domestic banks, the U.S. government, and foreign banks and official
institutions less cash items in the process of collection and Federal Reserve float;
and (4) negotiable order of withdrawal (NOW) and automatic transfer service
(ATS) accounts at banks and thrift institutions, credit union share draft (CUSD)
accounts, and demand deposits at mutual savings banks.
M2: Ml plus savings and small-denomination time deposits at all depository
institutions, overnight repurchase agreements at commercial banks, overnight
Eurodollars held by U.S. residents other than banks at Caribbean branches of
member banks, and balances of money market mutual funds (general purpose and
broker/dealer).
M3: M2 plus large-denomination time deposits at all depository institutions
and term RPs at commercial banks and savings and loan associations and balances
of institution-only money market mutual funds.
L: M3 plus other liquid assets such as term Eurodollars held by U.S. residents
other than banks, bankers acceptances, commercial paper, Treasury bills and
other liquid Treasury securities, and U.S. savings bonds.
4. Savings deposits exclude NOW and ATS accounts at commercial banks
and thrifts and CUSD accounts at credit unions.
Q4
Q3
Feb.
Q1
9.28
9.25
7.90
8.65
8.50
8.80
8.34
8.50
7.86
8.17
10.72
9.90
10.87
9.43
11.89
13.26
10.78
9.50
12.05
13.44
12.10
13.79
8.11
8.51
8.50
8.11
8.34
11.03
9.58
12.08
13.18
Mar.
8.77
8.50
8.35
8.52
10.80
9.20
11.70
13.17
5. Small-denomination time deposits—including retail RPs—are those issued
in amounts of less than $100,000.
6. Large-denomination time deposits are those issued in amounts of $100,000
or more.
7. Savings and loan associations, mutual savings banks, and credit unions.
8. Changes calculated from figures shown in table 1.23. Beginning December
1981, growth rates reflect shifts of foreign loans and securities from U.S. banking
offices to international banking facilities.
9. Averages of daily effective rates (average of the rates on a given date
weighted by the volume of transactions at those rates).
10. Rate for the Federal Reserve Bank of New York.
11. Quoted on a bank-discount basis.
12. Unweighted average of offering rates quoted by at least five dealers.
13. Market yields adjusted to a 20-year maturity by the U.S. Treasury.
14. Bond Buyer series for 20 issues of mixed quality.
15. Weighted averages of new publicly offered bonds rated Aaa, Aa, and A by
Moody's Investors Service and adjusted to an Aaa basis. Federal Reserve
compilations.
16. Average rates on new commitments for conventional first mortgages on
new homes in primary markets, unweighted and rounded to nearest 5 basis points,
from Dept. of Housing and Urban Development.
NOTE. Revisions in reserves of depository institutions reflect the transitional
phase-in of reserve requirements as specified in the Monetary Control Act of
1980.
A4
DomesticNonfinancialStatistics • June 1983
1.11
RESERVES OF DEPOSITORY INSTITUTIONS, RESERVE BANK CREDIT
Millions of dollars
Monthly averages of
daily figures
Weekly averages of daily figures for week ending
1983
1983
Factors
Mar.
Apr.
May
155,883
159,250
160,050
157,557
160,426
159,600
162,224
159,554
159,993
159,739
135,201
135,087
114
8,929
8,917
12
9
850
1,948
8,946
11,138
4,618
13,786
137,877
137,453
424
8,931
8,910
21
72
995
1,996
9,379
11,137
4,618
13,786
139,481
139,362
119
8,916
8,908
8
22
907
2,016
8,708
11,133
4,618
13,786
136,576
136,576
0
8,912
8,912
0
0
582
2.243
9.244
11,138
4,618
13,786
138,847
138,847
0
8,908
8,908
0
0
666
2,574
9,431
11,137
4,618
13,786
138,223
137,690
533
8,920
8,908
12
41
1,171
1,724
9,521
11,135
4,618
13,786
139,990
138,178
1,812
9,022
8,908
114
366
925
2,268
9,653
11,135
4,618
13,786
138,058
138,058
0
8,908
8,908
0
0
707
2,215
9,667
11,134
4,618
13,786
139,806
139,806
0
8,908
8,908
0
0
1,073
1,522
8,684
11,132
4,618
13,786
140,400
140,400
0
8,908
8,908
0
0
951
1,649
7,831
11,132
4,618
13,786
153,186
482
155,354
514
157,143
532
155,812
513
155,643
515
155,098
519
155,756
526
156,991
532
157,365
533
157,004
533
3,361
244
547
3,841
254
642
3,521
244
565
3,009
239
622
3,267
236
636
4,165
253
636
5,853
258
700
3,812
223
554
3,131
272
560
2,966
214
535
Apr. 13
Apr. 20
Apr. 27
May 4
May 11
May 18
May 25 p
SUPPLYING RESERVE FUNDS
1 Reserve Bank credit outstanding
2
3
4
5
6
7
8
9
10
11
12
13
14
U.S. government securities'
Bought outright
Held under repurchase agreements
Federal agency securities
Bought outright
Held under repurchase agreements
Acceptances
Loans
Float
Other Federal Reserve assets
Gold stock
Special drawing rights certificate account .
Treasury currency outstanding
ABSORBING RESERVE FUNDS
15 Currency in circulation
16 Treasury cash holdings
Deposits, other than reserves, with Federal
Reserve Banks
17 Treasury
18 Foreign
19 Other
20 Required clearing balances
21 Other Federal Reserve liabilities and
capital
22 Reserve accounts2
578
625
693
616
632
629
645
687
697
705
4,858
22,168
4,995
22,565
4,959
21,930
4,883
21,404
5,018
24,020
5,015
22,822
5,173
22,851
4,894
21,398
4,867
22,105
4,985
22,332
End-of-month figures
Wednesday figures
1983
1983
Apr. 13
May 25?
Mar.
Apr.
May
23 Reserve Bank credit outstanding
158,047
161,866
160,828
156,759
161,279
165,501
160,042
159,100
161,986
161,531
24
25
26
27
28
29
30
31
32
33
136,651
136,651
0
8,915
8,915
0
0
2,808
486
9,187
141,550
137,864
3,686
9,156
8,908
248
704
848
-1,124
10,732
141,180
141,180
0
8,908
8,908
0
0
1,260
850
8,630
135,419
135,419
0
8,908
8,908
0
0
519
2,559
9,354
138,899
138,899
0
8,908
8,908
0
0
1,263
2,717
9,492
141,108
137,376
3,732
8,995
8,908
87
285
4,073
1,274
9,766
138,331
138,331
0
8,908
8,908
0
0
798
2,398
9,607
136,869
136,869
0
8,908
8,908
0
0
1,170
2,305
9,848
141,297
141,297
0
8,908
8,908
0
0
2,028
1,951
7,802
140,750
140,750
0
8,908
8,908
0
0
1,548
2,225
8,100
11,138
4,618
13,786
11,135
4,618
13,786
11,132
4,618
13,786
11,137
4,618
13,786
11,137
4,618
13,786
11,135
4,618
13,786
11,135
4,618
13,786
11,132
4,618
13,786
11,132
4,618
13,786
11,132
4,618
13,786
154,307
498
155,307
524
158,634
532
156,224
513
155,729
515
155,661
521
156,639
530
157,718
532
157,546
534
157,627
532
3,572
425
535
601
6,015
322
796
641
4,372
445
679
711
3,523
212
554
615
4,5%
220
620
633
6,803
194
668
634
4,043
217
559
646
3,552
222
556
689
2,673
250
517
697
2,809
240
684
705
4,834
22,816
5,253
22,547
5,144
19,847
4,764
19,895
4,818
23,689
4,994
25,564
4,772
22,174
4,680
20,687
4,696
24,609
4,798
23,672
Apr. 20
Apr. 27
May 4
May 11
May 18
SUPPLYING RESERVE FUNDS
U.S. government securities'
Bought outright
Held under repurchase agreements
Federal agency securities
Bought outright
Held under repurchase agreements
Acceptances
Loans
Float
Other Federal Reserve assets
34 Gold stock
35 Special drawing rights certificate account .
36 Treasury currency outstanding
ABSORBING RESERVE FUNDS
37 Currency in circulation
38 Treasury cash holdings
Deposits, other than reserves, with Federal
Reserve Banks
39 Treasury
40 Foreign
41 Other
42 Required clearing balances
43 Other Federal Reserve liabilities and
capital
44 Reserve accounts2
1. Includes securities loaned—fully guaranteed by U.S government securities
pledged with Federal Reserve Banks—and excludes (if any) securities sold and
scheduled to be bought back under matched sale-purchase transactions.
2. Excludes required clearing balances,
NOTE. For amounts of currency and coin held as reserves, see table 1.12.
Depository
1.12 RESERVES AND BORROWINGS
Institutions
A5
Depository Institutions
Millions of dollars
Monthly averages of daily figures
Reserve classification
1981
Dec.
1 Reserve balances with Reserve Banks'
2 Total vault cash (estimated)
with required
3 Vault cash at institutions
reserve balances2
4 Vault cash equal to required reserves at
other institutions
5 Surplus vault cash at other institutions3
6 Reserve balances + total vault cash4
7 Reserve balances + total vault cash4 5used
to satisfy reserve requirements
8 Required reserves (estimated)
9 Excess reserve balances at Reserve Banks4 6
10 Total borrowings at Reserve Banks
11
Seasonal borrowings at Reserve Banks
12
Extended credit at Reserve Banks
1983
1982
Sept.
Nov.
Oct.
Jan.
Dec.
Feb.
Mar.
Apr.
MayP
26,163
19,538
23,385
19,921
24,252
19,578
24,604
19,807
24,804
20,392
24,431
21,454
23,530
20,035
22,168
19,484
22,565
19,569
21,930
19,709
13,577
13,651
13,658
13,836
14,292
14,602
13,705
13,027
13,246
13,429
2,178
3,783
45,701
2,927
3,343
43,306
2,677
3,243
43,830
2,759
3,212
44,411
2,757
3,343
45,1%
2,829
4,023
45,885
2,562
3,768
43,565
2,844
3,613
41,652
2,839
3,484
42,134
2,845
3,435
41,639
41,918
41,606
312
642
53
149
39,963
39,579
384
976
102
118
40,587
40,183
404
455
86
141
41,199
40,797
402
579
47
188
41,853
41,353
500
697
33
187
41,862
41,316
546
500
33
156
39,797
39,362
435
557
39
277
38,039
37,602
437
852
53
318
38,650
38,174
476
993
82
407
38,204
37,840
364
907
98
514
Weekly averages of daily figures for week ending
1983
Mar. 23
13 Reserve balances with Reserve Banks'
14 Total vault cash (estimated)
15 Vault cash at institutions
with required
reserve balances2
16 Vault cash equal to required reserves at
other institutions
17 Surplus vault cash at other institutions3
18 Reserve balances + total vault cash4
19 Reserve balances + total vault cash4,5used
to satisfy reserve requirements
20 Required reserves (estimated)
21 Excess reserve balances at Reserve Banks4,6
22 Total borrowings at Reserve Banks
23
Seasonal borrowings at Reserve Banks
24
Extended credit at Reserve Banks
Mar. 30
Apr. 13
Apr. 20
Apr. 27
May 4
May 11
May 18
May 25 P
23,138
18,297
22,373
19,392
21,780
19,692
21,404
20,059
24,020
18,625
22,822
19,630
22,851
20,244
21,398
20,307
22,105
19,516
22,332
18,896
12,652
13,137
13,285
13,198
12,891
13,417
13,709
13,512
13,081
13,213
2,438
3,207
41,435
2,779
3,476
41,765
2,863
3,544
41,472
3,126
3,735
41,463
2,478
3,256
42,645
2,832
3,381
42,452
2,977
3,558
43,095
3,123
3,672
41,705
2,947
3,488
41,621
2,555
3,128
41,228
38,228
37,896
332
641
59
346
38,289
37,825
464
897
62
305
37,928
37,296
632
1,762
80
328
37,728
37,165
563
582
72
353
39,389
39,170
219
666
77
405
39,071
38,612
459
1,171
90
484
39,537
38,935
602
925
101
493
38,033
37,572
461
707
91
506
38,133
37,755
378
1,073
91
519
38,100
37,640
460
951
104
511
1. As of Aug. 13, 1981, excludes required clearing balances of all depository
institutions.
2. Before Nov. 13, 1980, the figures shown reflect only the vault cash held by
member banks.
3. Total vault cash at institutions without required reserve balances less vault
cash equal to their required reserves.
4. Adjusted to include waivers of penalties for reserve deficiencies in accordance with Board policy, effective Nov. 19, 1975, of permitting transitional relief on
a graduated basis over a 24-month period when a nonmember bank merged into an
Apr. 6
existing member bank, or when a nonmember bank joins the Federal Reserve
System. For weeks for which figures are preliminary, figures by class of bank do
not add to total because adjusted data by class are not available.
5. Reserve balances with Federal Reserve Banks, which exclude required
clearing balances plus vault cash at institutions with required reserve balances
plus vault cash equal to required reserves at other institutions.
6. Reserve balances with Federal Reserve Banks, which exclude required
clearing balances plus vault cash used to satisfy reserve requirements less
required reserves. (This measure of excess reserves is comparable to the old
excess reserve concept published historically.)
A6
1.13
DomesticNonfinancialStatistics • June 1983
FEDERAL FUNDS AND REPURCHASE AGREEMENTS
Large Member Banks'
Averages of daily figures, in millions of dollars
1983, week ending Wednesday
By maturity and source
Mar. 30
One day and continuing contract
1 Commercial banks in United States
2 Other depository institutions, foreign banks and foreign
official institutions, and U.S. government agencies .
3 Nonbank securities dealers
4 All other
Apr. 6
Apr. 13
Apr. 20
Apr. 27
May 4
May 11
May 18
May 25
58,326
67,280
69,189
63,218
56,409
59,065
63,386
61,792
58,702
24,571
4,250
23,790
25,303
4,139
22,398
26,703
4,322
25,794
28,252
4,164
24,030
28,880
5,375
25,942
30,120
5,067
26,907
29,157
4,518
27,172
29,147
5,046
26,420
29,088
6,394
26,918
All other maturities
5 Commercial banks in United States
6 Other depository institutions, foreign banks and foreign
official institutions, and U.S. government agencies .
7 Nonbank securities dealers
8 All other
5,292
5,988
4,934
5,270
4,858
4,883
4,776
4,849
5,140
11,005
5,518
9,714
11,456
5,992
10,998
10,509
5,323
7,904
10,560
5,566
9,707
9,681
5,944
8,926
9,781
6,263
8,584
9,337
6,227
9,352
9,351
6,422
9,616
9,578
6,525
9,535
MEMO: Federal funds and resale agreement loans in maturities of one day or continuing contract
9 Commercial banks in United States
10 Nonbank securities dealers
20,413
4,356
25,898
4,481
27,496
4,532
24,826
4,252
22,556
4,315
25,686
4,332
24,544
3,932
24,315
3,858
22,972
4,287
1. Banks with assets of $1 billion or more as of Dec. 31, 1977.
Policy Instruments
1.14
All
FEDERAL RESERVE BANK INTEREST RATES
Percent per annum
Current and previous levels
Extended credit1
Short-term adjustment credit
and seasonal credit
Federal Reserve
Bank
Rate on
5/31/83
m
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City . . . .
Dallas
San Francisco...
m
Effective
date
Previous
rate
12/14/82
12/15/82
12/17/82
12/15/82
12/15/82
12/14/82
9
12/14/82
12/14/82
12/14/82
12/15/82
12/14/82
12/14/82
9
Next 90 days
of borrowing
First 60 days
of borrowing
Rate on
5/31/83
In effect Dec. 31, 1973
1974— Apr. 25
30
Dec. 9
16
1975— Jan.
6
10
24
Feb. 5
7
Mar. 10
14
May 16
23
Range (or
level)—
All F.R.
Banks
F.R.
Bank
of
N.Y.
IVi
m
7Vi-8
8
73/4-8
Rate on
5/31/83
Previous
rate
Rate on
5/31/83
Previous
rate
9
91/2
10
101/2
11
m
%Vi
9
73/4
71/4-73/4
7'/4-73/4
71/4
6V4-7V4
63/4
6'/4-63/4
6'/4
6-6'/4
6
Effective date
1978— July
3
10
3
7 /4
73/4
73/4
7>/4
7'/4
63/4
63/4
6l/4
6'/4
6
6
Aug. 21
Sept. 22
Oct. 16
20
Nov. 1
3
1979—July 20
Aug. 17
20
Sept. 19
21
Oct.
8
10
1976— Jan. 19
23
Nov. 22
26
1977— Aug. 30
31
Sept. 2
Oct. 26
51/>-6
l
5 /i
51/4
5'/4-5'/i
51/4
5V4
5'/4-53/4
5'/4
53/4
51/4-55/4
5%
6
9
6 - 6 Vi
May 11
61/2-7
7
1978— Jan.
20
12
5'/!
5V5
6 Vi
51/4
6
6Vi
6'/2
7
7
1980—Feb. 15
19
May 29
30
June 13
16
July 28
29
Sept. 26
Nov. 17
Dec. 5
1. Applicable to advances when exceptional circumstances or practices involve
only a particular depository institution and to advances when an institution is
under sustained liquidity pressures. See section 201.3(b)(2) of Regulation A.
2. Rates for short-term adjustment credit. For description and earlier data see
the following publications of the Board of Governors: Banking and Monetary
Statistics, 1914-1941 and 1941-1970; Annual Statistical Digest, 1970-1979, and
1980.
Effective date
for current rates
Previous
rate
9Vi
Range of rates in recent years
Effective date
After 150 days
7-7'/»
71/4
3
7 /4
8
8Vi
8'/2-9'/2
9Vi
10
10-10Vi
lOVi
10Vi-ll
11
11-12
12
lO'/i
12/14/82
12/14/82
12/14/82
12/15/82
12/14/82
12/14/82
11
2
Range (or
level)—
All F.R.
Banks
8-8 !/2
10
12/14/82
12/15/82
12/17/82
12/15/82
12/15/82
12/14/82
F.R.
Bank
of
N.Y.
71/4
7'/4
73/4
8
816
m
9V4
9 Vi
10
10 Vi
10Vi
11
11
12
12
12-13
13
12-13
13
13
13
12
12
11-12
11
11
10-11
11
10
11
12
10
11
12
12-13
13
13
13
Effective date
1981— May
5
8
Nov. 2
6
Dec. 4
1982—July 20
23
Aug. 2
3
16
27
30
Oct. 12
13
Nov. 22
26
Dec. 14
15
17
Range (or
levelsAll F.R.
Banks
13-14
14
13-14
13
12
llVi-12
llVi
1I-11V5
11
im
10-10'/!
F.R.
Bank
of
N.Y.
14
14
13
13
12
10
iivi
llVi
11
11
10'h
10
10
91/2-10
91h
m
9-9'A
9
81/2-9
8Vi-9
9ih
9
9
9
8 Vi
8V2
81/2
8Vi
8Vi
10
In effect May 31, 1983
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 4 weeks in a calendar
quarter. A 3 percent surcharge was in effect from Mar. 17, 1980, through May 7,
1980. There was no surcharge until Nov. 17, 1980, when a 2 percent surcharge was
adopted; 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. As of Oct. 1, the formula for
applying the surcharge was changed from a calendar quarter to a moving 13-week
period. The surcharge was eliminated on Nov. 17, 1981.
A8
DomesticNonfinancialStatistics • June 1983
1.15
RESERVE REQUIREMENTS OF DEPOSITORY INSTITUTIONS1
Percent of deposits
Type of deposit, and
deposit interval
Member bank requirements
before implementation of the
Monetary Control Act
Percent
Effective date
2
Net demand
$0 million-$2 million
$2 million-$10 million
$10 million-$100 million
$100 million-$400 million
Over $400 million
Time and savings2 3
Savings
Time4
$0 million-$5 million, by maturity
30-179 days
180 days to 4 years
4 years or more
Over $5 million, by maturity
30-179 days
180 days to 4 years
4 years or more
7
9lA
16'/4
12/30/76
12/30/76
12/30/76
12/30/76
12/30/76
3
3/16/67
113/4
123/4
Net transaction accounts7,8
Over $26.3 million
Nonpersonal time deposits9
By original maturity
Less than 2xh years
2'/2 years or more
Depository institution requirements
after implementation of the
Monetary Control Act6
Percent
Effective date
3
12
12/30/82
12/30/82
3
0
3/31/83
3/31/83
3
11/13/80
Eurocurrency liabilities
3
2W
1
6
2Vi
1
3/16/67
1/8/76
10/30/75
12/12/74
1/8/76
10/30/75
1. For changes in reserve requirements beginning 1963, see Board's Annual
Statistical Digest, 1971-1975 and for prior changes, see Board's Annual Report
for 1976, table 13. Under provisions of the Monetary Control Act, depository
institutions include commercial banks, mutual savings banks, savings and loan
associations, credit unions, agencies and branches offoreign banks, and Edge Act
corporations.
2. Requirement schedules are graduated, and each deposit interval applies to
that part of the deposits of each bank. Demand deposits subject to reserve
requirements were gross demand deposits minus cash items in process of
collection and demand balances due from domestic banks.
The Federal Reserve Act as amended through 1918 specified different ranges of
requirements for reserve city banks and for other banks. Reserve cities were
designated under a criterion adopted effective Nov. 9, 1972, by which a bank
having net demand deposits of more than $400 million was considered to have the
character of business of a reserve city bank. The presence of the head office of
such a bank constituted designation of that place as a reserve city. Cities in which
there were Federal Reserve Banks or branches were also reserve cities. Any
banks having net demand deposits of $400 million or less were considered to have
the character of business of banks outside of reserve cities and were permitted to
maintain reserves at ratios set for banks not in reserve cities.
Effective Aug. 24, 1978, the Regulation M reserve requirements on net balances
due from domestic banks to their foreign branches and on deposits that foreign
branches lend to U.S. residents were reduced to zero from 4 percent and 1 percent
respectively. The Regulation D reserve requirement of borrowings from unrelated
banks abroad was also reduced to zero from 4 percent.
Effective with the reserve computation period beginning Nov. 16, 1978,
domestic deposits of Edge corporations were subject to the same reserve
requirements as deposits of member banks.
3. Negotiable order of withdrawal (NOW) accounts and time deposits such as
Christmas and vacation club accounts were subject to the same requirements as
savings deposits.
The average reserve requirement on savings and other time deposits before
implementation of the Monetary Control Act had to be at least 3 percent, the
minimum specified by law.
4. Effective Nov. 2, 1978, a supplementary reserve requirement of 2 percent
was imposed on large time deposits of $100,000 or more, obligations of affiliates,
and ineligible acceptances. This supplementary requirement was eliminated with
the maintenance period beginning July 24, 1980.
Effective with the reserve maintenance period beginning Oct. 25, 1979, a
marginal reserve requirement of 8 percent was added to managed liabilities in
excess of a base amount. This marginal requirement was increased to 10 percent
beginning Apr. 3, 1980, was decreased to 5 percent beginning June 12, 1980, and
was eliminated beginning July 24, 1980. Managed liabilities are defined as iarge
time deposits, Eurodollar borrowings, repurchase agreements against U.S.
government and federal agency securities, federal funds borrowings from nonmember institutions, and certain other obligations. In general, the base for the
marginal reserve requirement was originally the greater of (a) $100 million or (b)
the average amount of the managed liabilities held by a member bank, Edge
corporation, or family of U.S. branches and agencies of a foreign bank for the two
reserve computation periods ending Sept. 26, 1979. For the computation period
beginning Mar. 20, 1980, the base was lowered by (a) 7 percent or (b) the decrease
in an institution's U.S. office gross loans to foreigners and gross balances due
from foreign offices of other institutions between the base period (Sept. 13-26,
1979) and the week ending Mar. 12, 1980, whichever was greater. For the
computation period beginning May 29, 1980, the base was increased by 7'/2
Type of deposit, and
deposit interval5
percent above the base used to calculate the marginal reserve in the statement
week of May 14-21, 1980. In addition, beginning Mar. 19, 1980, the base was
reduced to the extent that foreign loans and balances declined.
5. The Garn-St Germain Depository Institutions Act of 1982 (Public Law 97320) provides that $2 million of reservable liabilities (transaction accounts,
nonpersonal time deposits, and Eurocurrency liabilities) of each depository
institution be subject to a zero percent reserve requirement. The Board is to adjust
the amount of reservable liabilities subject to this zero percent reserve requirement each year for the next succeeding calendar year by 80 percent of the
percentage increase in the total reservable liabilities of all depository institutions,
measured on an annual basis as of June 30. No corresponding adjustment is to be
made in the event of a decrease. Effective Dec. 9, 1982, the amount of the
exemption was established at $2.1 million. In determining the reserve requirements of a depository institution, the exemption shall apply in the following order:
(1) nonpersonal money market deposit accounts (MMDAs) authorized under 12
CFR section 1204.122; (2) net NOW accounts (NOW accounts less allowable
deductions); (3) net other transaction accounts; and (4) nonpersonal time deposits
or Eurocurrency liabilities starting with those with the highest reserve ratio. With
respect to NOW accounts and other transaction accounts, the exemption applies
only to such accounts that would be subject to a 3 percent reserve requirement.
6. For nonmember banks and thrift institutions that were not members of the
Federal Reserve System on or after July 1, 1979, a phase-in period ends Sept. 3,
1987. For banks that were members on or after July 1, 1979, but withdrew on or
before Mar. 31, 1980, the phase-in period established by Public Law 97-320 ends
on Oct. 24, 1985. For existing member banks the phase-in period is about three
years, depending on whether their new reserve requirements are greater or less
than the old requirements. All new institutions will have a two-year phase-in
beginning with the date that they open for business, except for those institutions
that have total reservable liabilities of $50 million or more.
7. Transaction accounts include all deposits on which the account holder is
permitted to make withdrawals by negotiable or transferable instruments, payment orders of withdrawal, and telephone and preauthorized transfers (in excess
of three per month) for the purpose of making payments to third persons or others.
However, MMDAs and similar accounts offered by institutions not subject to the
rules of the Depository Institutions Deregulation Committee (DIDC) that permit
no more than six preauthorized, automatic, or other transfers per month of which
no more than three can be checks—are not transaction accounts (such accounts
are savings deposits subject to time deposit reserve requirements.)
8. 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 increase in transaction accounts held by
all depository institutions determined as of June 30 each year. Effective Dec. 31,
1981, the amount was increased accordingly from $25 million to $26 million; and
effective Dec. 30, 1982, to $26.3 million.
9. In general, nonpersonal time deposits are time deposits, including savings
deposits, that are not transaction accounts and in which the beneficial interest is
held by a depositor that is not a natural person. Also included are certain
transferable time deposits held by natural persons, and certain obligations issued
to depository institution offices located outside the United States. For details, see
section 204.2 of Regulation D.
NOTE. Required reserves must be held in the form of deposits with Federal
Reserve Banks or vault cash. After implementation of the Monetary Control Act,
nonmembers may maintain reserves on a pass-through basis with certain approved institutions.
Policy Instruments
All
1.16 MAXIMUM INTEREST RATES PAYABLE on Time and Savings Deposits at Federally Insured Institutions
Percent per annum
Savings and loan associations and
mutual savings banks (thrift institutions)
Commercial banks
Type and maturity of deposit
In effect May 31, 1983
Percent
1 Savings
2 Negotiable order of withdrawal accounts2
3
4
5
6
7
9
11
12
Time accounts3
Fixed ceilingr rates by maturity4
14-89 days
90 days to 17year
1 to 2 years
2l to 2xh years77
2 /2 to 4 years
6 to 8 years
8
Issued to governmental
units (all
maturities)10
IRAs and Keogh
(H.R.
10) plans (3 years
or more)10'11
Effective
date
Previous maximum
Percent
Effective
date
In effect May 31, 1983
Percent
5V4
51/4
7/1/79
12/31/80
5
5
51/4
53/4
8/1/79
1/1/80
7/1/73
7/1/73
11/1/73
12/23/74
6/1/78
5
5Yi
5'/i
(9)
7'/4
(6)
8
6/1/78
73/4
12/23/74
8
8
8
6/1/78
73/4
7/6/77
8
6
6'/i
7V4
7 Vi
73/4
1. July 1, 1973, for mutual savings banks; July 6, 1973, for savings and loans.
2. Federally insured commercial banks, savings and loan associations, cooperative banks, and mutual savings banks in Massachusetts and New Hampshire
were first permitted to offer negotiable order of withdrawal (NOW) accounts on
Jan. 1, 1974. Authorization to issue NOW accounts was extended to similar
institutions throughout New England on Feb. 27, 1976, in New York State on
Nov. 10, 1978, New Jersey on Dec. 28, 1979, and to similar institutions nationwide
effective Dec. 31, 1980. Effective January 5, 1983 the interest rate ceiling is
removed for NOW accounts with an initial balance and average maintenance
balance of $2,500.
3. For exceptions with respect to certain foreign time deposits see the
BULLETIN f o r O c t o b e r 1962 (p. 1279), A u g u s t 1965 (p. 1084), and F e b r u a r y 1968
(p. 167).
4. Effective Nov. 10, 1980, the minimum notice period for public unit accounts
at savings and loan associations was decreased to 14 days and the minimum
maturity period for time deposits at savings and loan associations in excess of
$100,000 was decreased to 14 days. Effective Oct. 30, 1980, the minimum maturity
or notice period for time deposits was decreased from 30 to 14 days at mutual
savings banks.
5. Effective Oct. 30, 1980, the minimum maturity or notice period for time
deposits was decreased from 30 to 14 days at commercial banks.
6. No separate account category.
7. No minimum denomination. Until July 1, 1979, a minimum of $1,000 was
required for savings and loan associations, except in areas where mutual savings
banks permitted lower minimum denominations. This restriction was removed for
deposits maturing in less than 1 year, effective Nov. 1, 1973.
8. No minimum denomination. Until July 1, 1979, the minimum denomination
was $1,000 except for deposits representing funds contributed to an individual
retirement account (IRA) or a Keogh (H.R. 10) plan established pursuant to the
Internal Revenue Code. The $1,000 minimum requirement was removed for such
accounts in December 1975 and November 1976 respectively.
53/4
53/4
7/1/73
1/1/74
7/1/73
7/1/73
1/21/70
1/21/70
1/21/70
11/1/73
51/2
5V4
(6)
6
6V2.
63/4
7Vi
73/4
Effective
date
Previous maximum
Percent
7/1/79
12/31/80
1/1/80
0)
(*)
11/1/73
12/23/74
6/1/78
5'/4
5
(6)
53/,
53/4
(•)
1/1/74
(')
1/21/70
1/21/70
1/21/70
11/1/73
6/1/78
73/4
12/23/74
6/1/78
73/4
7/6/77
9. Between July 1, 1973, and Oct. 31, 1973, certificates maturing in 4 years or
more with minimum denominations of $1,000 had no ceiling; however, the amount
of such certificates that an institution could issue was limited to 5 percent of its
total time and savings deposits. Sales in excess of that amount, as well as
certificates of less than $1,000, were limited to the 6Vi percent ceiling on time
deposits maturing in 2xh years or more. Effective Nov. 1, 1973, ceilings were
reimposed on certificates maturing in 4 years or more with minimum denomination of $1,000. There is no limitation on the amount of these certificates that banks
can issue.
10. Accounts subject to fixed-rate ceilings. See footnote 8 for minimum
denomination requirements.
11. Effective Jan. 1,1980, commercial banks are permitted to pay the same rate
as thrifts on IRA and Keogh accounts and accounts of governmental units when
such deposits are placed in 2Vi-year-or-more variable-ceiling certificates or in 26week money market certificates regardless of the level of the Treasury bill rate.
NOTE. Before Mar. 31, 1980, the maximum rates that could be paid by federally
insured commercial banks, mutual savings banks, and savings and loan associations were established by the Board of Governors of the Federal Reserve System,
the Board of Directors of the Federal Deposit Insurance Corporation, and the
Federal Home Loan Bank Board under the provisions of 12 CFR 217, 329, and 526
respectively. Title II of the Depository Institutions Deregulation and Monetary
Control Act of 1980 (P.L. 96-221) transferred the authority of the agencies to
establish maximum rates of interest payable on deposits to the Depository
Institutions Deregulation Committee. The maximum rates on time deposits in
denominations of $100,000 or more with maturities of 30-89 days were suspended
in June 1970; the maximum rates for such deposits maturing in 90 days or more
were suspended in May 1973. For information regarding previous interest rate
ceilings on all types of accounts, see earlier issues of the FEDERAL RESERVE
BULLETIN, the Federal Home Loan Bank Board Journal, and the Annual Report
of the Federal Deposit Insurance Corporation.
For deposits subject to variable ceiling rates and deposits not subject to interest rate ceilings see page A10.
6
6
(9)
7V4
(6)
Effective
date
A10
1.16
DomesticNonfinancialStatistics • June 1983
Continued
TIME DEPOSITS SUBJECT TO VARIABLE CEILING RATES
91-day time deposits. Effective May 1, 1982, depository institutions were
authorized to offer time deposits that have a minimum denomination of $7,500 and
a maturity of 91 days. Effective January 5, 1983, the minimum denomination
required for this deposit is reduced to $2,500. The ceiling rate of interest on these
deposits is indexed to the discount rate (auction average) on most recently issued
91-day Treasury bills for thrift institutions and the discount rate minimum 25 basis
points for commercial banks. The rate differential ends 1 year from the effective
date of these instruments and is suspended at any time the Treasury bill discount
rate is 9 percent or below for four consecutive auctions. The maximum allowable
rates in May 1983 (in percent) for commercial banks and thrifts were as follows:
May 3, 8.04; May 10, 8.14; May 17, 8.10; May 24, 8.46.
Six-month money market time deposits. Effective June 1, 1978, commercial
banks and thrift institutions were authorized to offer time deposits with a maturity
of exactly 26 weeks and a minimum denomination requirement of $10,000.
Effective January 5, 1983, the minimum denomination required for this deposit is
reduced to $2,500. The ceiling rate of interest on these deposits is indexed to the
discount rate (auction average) on most recently issued 26-week U.S. Treasury
bills. Interest on these certificates may not be compounded. Effective for all 6month money market certificates issued beginning Nov. 1, 1981, depository
institutions may pay rates of interest on these deposits indexed to the higher of (1)
the rate for 26-week Treasury bills established immediately before the date of
deposit (bill rate) or (2) the average of the four rates for 26-week Treasury bills
established for the 4 weeks immediately before the date of deposit (4-week
average bill rate). Ceilings are determined as follows:
Bill rate or 4-week
average bill rate
7.50 percent or below
Above 7.50 percent
7.25 percent or below
Above 7.25 percent, but below
8.50 percent
8.50 percent or above, but below
8.75 percent
8.75 percent or above
Commercial bank ceiling
7.75 percent
'/4 of 1 percentage point plus the higher of
the bill rate or 4-week average bill rate
Thrift ceiling
7.75 percent
Vi of 1 percentage point plus the higher of
the bill rate or 4-week average bill rate
9 percent
'/» of 1 percentage point plus the higher of
the bill rate or 4-week average bill rate
12-month all savers certificates. Effective Oct. 1, 1981, depository institutions
are authorized to issue all savers certificates (ASCs) with a 1-year maturity and an
annual investment yield equal to 70 percent of the average investment yield for 52week U.S. Treasury bills as determined by the auction of 52-week Treasury bills
held immediately before the calendar week in which the certificate is issued. A
maximum lifetime exclusion of $1,000 ($2,000 on ajoint return) from gross income
is generally authorized for interest income from ASCs. The annual investment
yield for ASCs issued in December 1982 (in percent) was as follows: Dec. 26, 6.26.
1'/2-year to less than 2'/2-year time deposits. Effective Aug. 1, 1981, commercial
banks are authorized to pay interest on any variable ceiling nonnegotiable time
deposit with an original maturity of 2'/2 years to less than 4 years at a rate not to
exceed V* of 1 percent below the average 2'/2-year yield for U.S. Treasury
securities as determined and announced by the Treasury Department immediately
before the date of deposit. Effective May 1, 1982, the maximum maturity for this
category of deposits was reduced to less than V/2 years. Effective Apr. 1, l1983, the
maximum maturity for this category of deposits was reduced to less than 2 /i years
and the minimum maturity was reduced to l'/2 years. Thrift institutions may pay
interest on these certificates at a rate not to exceed the average 1 '/2-year yield for
Treasury securities as determined and announced by the Treasury Department
immediately before the date of deposit. If the announced average 1'/2-year yield
for Treasury securities is less than 9.50 percent, commercial banks may pay 9.25
percent and thrift institutions 9.50 percent for these deposits. These deposits have
no required minimum denomination, and interest may be compounded on them.
The ceiling rates of interest at which they may be offered vary biweekly. The
maximum allowable rates in May 1983 (in percent) for commercial banks were as
follows: May 10, 9.25; May 24, 9.25; and for thrift institutions: May 10, 9.50;
May 24, 9.50.
Between Jan. 1, 1980, and Aug. 1, 1981, commercial banks and thrift institutions were authorized to offer variable ceiling nonnegotiable time
deposits with no
required minimum denomination and with maturities of 2l/z years or more.
Effective Jan. 1, 1980, the maximum rate for commercial banks was V4 percentage
point below the average yield on 2'/i-year U.S. Treasury securities; the ceiling rate
for thrift institutions was V4 percentage point higher 3than that for commercial
banks. Effective Mar. 1, 1980, a temporary ceiling of ll /4 percent was placed on
these accounts at commercial banks and 12 percent on these accounts at savings
and loans. Effective June 2, 1980, the ceiling rates for these deposits at
commercial banks and savings and loans were increased V2 percentage point. The
temporary ceiling was retained, and a minimum ceiling of 9.25 percent for
commercial banks and 9.50 percent for thrift institutions was established.
The maximum rates in May 1983 for commercial banks based on the bill rate were
as follows: May 3, 8.30; May 10, 8.38; May 17, 8.39; May 24, 8.72, and based on
the 4-week average bill rate were as follows: May 3, 8.43; May 10, 8.40; May 17,
8.38; May 24, 8.44. The maximum allowable rates in May 1983 for thrifts based on
the bill rate were as follows: May 3, 8.55; May 10, 8.63; May 17, 8.64; May 24,
8.97; and based on the 4-week average bill rate were as follows: May 3, 8.68;
May 10, 8.65; May 17, 8.63; May 24, 8.69.
TIME DEPOSITS NOT SUBJECT TO INTEREST RATE CEILINGS
Money market deposit account. Effective Dec. 14,1982, depository institutions
are authorized to offer a new account with a required initial balance of $2,500 and
an average maintenance balance of $2,500 not subject to interest rate restrictions.
No minimum maturity period is required for this account, but depository
institutions must reserve the right to require seven days' notice before withdrawals. When the average balance is less than $2,500, the account is subject to the
maximum ceiling rate of interest for NOW accounts; compliance with the average
balance requirement may be determined over a period of one month. Depository
institutions may not guarantee a rate of interest for this account for a period longer
than one month or condition the payment of a rate on a requirement that the funds
remain on deposit for longer than one month. No more than six preauthorized,
automatic, or other third-party transfers are permitted per month, of which no
more than three can be checks. Telephone transfers to third parties or to another
account of the same depositor are regarded as preauthorized transfers.
IRAs and Keogh (H.R. 10) plans <18 months or more). Effective Dec. 1, 1981,
depository institutions are authorized to offer time deposits not subject to interest
rate ceilings when the funds are deposited to the credit of, or in which the entire
beneficial interest is held by, an individual pursuant to an IRA agreement or
Keogh (H.R. 10) plan. Such time deposits must have a minimum maturity of 18
months, and additions may be made to the time deposit at any time before its
maturity without extending the maturity of all or a portion of the balance of the
account.
Time deposits of 7 to 31 days. Effective Sept. 1, 1982, depository institutions
were authorized to issue nonnegotiable time deposits of $20,000 or more with a
maturity or required notice period of 7 to 31 days. The maximum rate of interest
payable by thrift institutions was the rate established and announced (auction
average on a discount basis) for U.S. Treasury bills with maturities of 91 days at
the auction held immediately before the date of deposit or renewal ("bill rate").
Commercial banks could pay the bill rate minus 25 basis points. The interest rate
ceiling was suspended when the bill rate is 9 percent or below for the four most
recent auctions held before the date of deposit or renewal. Effective January 5,
1983, the minimum denomination required for this deposit was reduced to $2,500
and the interest rate ceiling was removed.
Time deposits of 2'/2 years or more. Effective May 1, 1982, depository
institutions were authorized to offer negotiable or nonnegotiable time deposits
with a minimum original maturity of 3'/2 years or more that are not subject to
interest rate ceilings. Such time deposits have no minimum denomination, but
must be made available in a $500 denomination. Additional deposits may be made
to the account during the first year without extending its maturity. Effective
Apr. 1, 1983, the minimum maturity period for this category of deposits was
reduced to 2'/i years.
Policy Instruments
1.17
All
FEDERAL RESERVE OPEN MARKET TRANSACTIONS
Millions of dollars
1982
Type of transaction
1980
1981
1983
1982
Nov.
Oct.
Dec.
Jan.
Mar.
Feb.
Apr.
U . S . GOVERNMENT SECURITIES
Outright transactions (excluding matched
transactions)
1
2
3
4
Treasury bills
Gross purchases
Gross sales
Exchange
Redemptions
5
6
7
8
9
Others within 1 year
Gross purchases
Gross sales
Maturity shift
Exchange
Redemptions
7,668
7,331
0
3,389
13,899
6,746
0
1,816
17,067
8,369
0
3,000
774
0
0
0
2,552
0
0
0
1,897
731
0
200
0
1,983
0
900
1,456
934
0
300
1,259
0
0
0
2,880
0
0
0
912
0
12,427
-18,251
0
317
23
13,794
-12,869
0
312
0
17,295
-14,164
0
0
0
623
0
0
88
0
2,819
-1,924
0
0
0
906
-943
0
0
0
558
-544
0
0
0
4,564
-2,688
0
0
0
1,198
-900
0
0
0
826
0
0
10
11
12
13
1 to 5 years
Gross purchases
Gross sales
Maturity shift
Exchange
2,138
0
-8,909
13,412
1,702
0
-10,299
10,117
1,797
0
-14,524
11,804
0
0
-623
0
485
0
-2,204
1,515
0
0
-906
943
0
0
-553
544
0
0
-4,564
1,599
0
0
-1,198
900
0
0
-684
0
14
15
16
17
5 to 10 years
Gross purchases
Gross sales
Maturity shift
Exchange
703
0
-3,092
2,970
393
0
-3,495
1,500
388
0
-2,172
2,128
0
0
0
0
194
0
-616
250
0
0
0
0
0
0
-5
0
0
0
229
650
0
0
0
0
0
0
-142
0
18
19
20
21
Over 10 years
Gross purchases
Gross sales
Maturity shift
Exchange
811
0
-426
1,869
379
0
0
1,253
307
0
-601
234
0
0
0
0
132
0
0
159
0
0
0
0
0
0
0
0
0
0
-229
439
0
0
0
0
0
0
0
0
22
23
24
All maturities
Gross purchases
Gross sales
Redemptions
12,232
7,331
3,389
16,690
6,769
1,816
19,870
8,369
3,000
774
0
0
3,452
0
0
1,897
731
200
0
1,983
900
1,456
934
300
1,259
0
0
2,880
0
0
25
26
Matched transactions
Gross sales
Gross purchases
674,000
675,496
589,312
589,647
543,804
543,173
45,655
46,370
39,579
41,724
72,123
69,088
59,398
59,043
35,234
38,204
47,892
47,724
37,873
36,205
27
28
Repurchase agreements
Gross purchases
Gross sales
113,902
113,040
79,920
78,733
130,774
130,286
5,618
9,420
4,161
4,161
15,229
11,525
6,747
10,451
6,697
6,697
3,526
3,526
7,671
3,984
3,869
9,626
8,358
-2,313
5,596
1,636
-6,943
3,192
1,090
4,899
668
0
145
494
0
108
0
0
189
0
0
6
0
0
0
0
6
0
0
9
0
0
5
0
0
8
0
0
7
28,895
28,863
13,320
13,576
18,957
18,638
1,776
2,778
739
739
2,566
1,978
452
1,040
276
276
379
379
340
92
555
130
130
-1,008
582
-596
-5
-8
241
73
-582
1,285
-813
0
1,480
-1,480
0
0
704
4,497
9,175
9,773
-4,134
5,596
3,697
-9,019
3,187
1,082
5,844
29 Net change in U.S. government securities
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
*
*
BANKERS ACCEPTANCES
36 Repurchase agreements, net
37 Total net change in System Open Market
Account
NOTE: Sales, redemptions, and negative figures reduce holdings of the System
Open Market Account; all other figures increase such holdings. Details may not
add to totals because of rounding.
A12
1.18
DomesticNonfinancialStatistics • June 1983
FEDERAL RESERVE BANKS
Condition and Federal Reserve Note Statements
Millions of dollars
Account
Apr.
27
May
Wednesday
End of month
1983
1983
May
4
May
11
May
18
Apr.
Mar.
25
May
Consolidated condition statement
ASSETS
11,135
4,618
444
11,135
4,618
466
11,132
4,618
439
11,132
4,618
432
11,132
4,618
426
11,138
4,618
477
11,135
4,618
452
11,132
4,618
403
4,073
0
798
0
1,170
0
2,028
0
1,548
0
2,808
0
848
0
1,260
0
1 Gold certificate account
2 Special drawing rights certificate account
3 Coin
Loans
4 To depository institutions
5 Other
Acceptances
6 Held under repurchase agreements
Federal agency obligations
7 Bought outright
8 Held under repurchase agreements
U.S. government securities
Bought outright
9
Bills
10
Notes
11
Bonds
12
Total1
13 Held under repurchase agreements
14 Total U.S. government securities
285
0
0
0
0
0
704
0
8,908
87
8,908
0
8,908
0
8,908
0
8,908
0
8,915
0
8,908
248
8,908
0
56,194
62,187
18,995
137,376
3,732
141,108
57,149
62,187
18,995
138,331
0
138,331
55,687
62,187
18,995
136,869
0
136,869
58,912
63,107
19,278
141,297
0
141,297
58,365
63,107
19,278
140,750
0
140,750
55,469
62,187
18,995
136,651
0
136,651
56,682
62,187
18,995
137,864
3,686
141,550
58,795
63,107
19,278
141,180
0
141,180
15 Total loans and securities
154,461
148,037
146,947
152,233
151,206
148,374
152,258
151,348
8,959
551
9,742
553
8,834
553
9,087
553
8,797
553
6,584
552
6,354
552
6,607
553
4,983
4,232
4,958
4,0%
4,969
4,326
4,389
2,860
4,394
3,153
4,962
3,673
4,957
5,223
4,376
3,701
189,383
183,605
181,818
185,304
184,279
180,378
185,549
182,738
142,841
143,850
144,903
144,726
144,799
141,497
142,497
145,783
26,201
6,803
194
665
22,823
4,043
217
556
21,380
3,552
222
552
25,311
2,673
250
512
24,383
2,809
240
678
23,419
3,572
425
533
23,193
6,015
322
791
20,567
4,372
445
670
33,863
27,639
25,706
28,746
28,110
27,949
30,321
26,054
7,685
1,906
7,344
1,696
6,529
1,577
7,136
1,600
6,572
1,698
6,098
1,752
7,478
2,069
5,757
1,849
186,295
180,529
178,715
182,208
181,179
177,296
182,365
179,443
1.407
1,359
322
1,408
1,359
309
1,409
1,359
335
1,413
1,359
324
1,413
1,359
328
1,393
1,359
330
1,407
1,359
418
1,413
1,359
523
189,383
183,605
181,818
185,304
184,279
180,378
185,549
182,738
110,748
110,881
109,971
109,667
107,950
112,120
109,843
110,198
16 Cash items in process of collection
17 Bank premises
Other assets
18 Denominated
in foreign currencies2
19 All other3
20 Total assets
LIABILITIES
21 Federal Reserve notes
Deposits
22 Depository institutions
23 U.S. Treasury—General account
24 Foreign—Official accounts
25 Other
26 Total deposits
27 Deferred availability cash items
28 Other liabilities and accrued dividends4
29 Total liabilities
CAPITAL ACCOUNTS
30 Capital paid in
31 Surplus
32 Other capital accounts
33 Total liabilities and capital accounts
34 MEMO: Marketable U.S. government securities held in
custody for foreign and international account
Federal Reserve note statement
35 Federal Reserve notes outstanding
(issued to bank) ..
36
LESS: Held by bank5
37
Federal Reserve notes, net
Collateral for Federal Reserve notes
38 Gold certificate account
39 Special drawing rights certificate account
40 Other eligible assets
41 U.S. government and agency securities
161,329
18,488
142,841
161,510
17,660
143,850
162,019
17,116
144,903
162,920
18,194
144,726
163,353
18,554
144,799
159,568
18,130
141,438
161,327
18,830
142,497
163,394
17,611
145,783
11,135
4,618
0
127,088
11,135
4,618
0
128,097
11,132
4,618
0
129,153
11,132
4,618
0
128,976
11,132
4,618
0
129,049
11,138
4,618
0
125,682
11,135
4,618
0
126,744
11,132
4,618
0
130,033
42 Total collateral.
142,841
143,850
144,903
144,726
144,799
141,438
142,497
145,783
1. Includes securities loaned—fully guaranteed by U.S. government securities
pledged with Federal Reserve Banks—and excludes (if any) securities sold and
scheduled to be bought back under matched sale-purchase transactions.
2. Includes U.S. government securities held under repurchase agreement
against receipt of foreign currencies and foreign currencies warehoused for the
U.S. Treasury. Assets shown in this line are revalued monthly at market exchange
rates.
3. Includes special investment account at Chicago of Treasury bills maturing
within 90 days.
4. Includes exchange-translation account reflecting the monthly revaluation at
market exchange rates of foreign-exchange commitments.
5. Beginning September 1980, Federal Reserve notes held by the Reserve Bank
are exempt from the collateral requirement.
Reserve Banks; Banking Aggregates
1.19
FEDERAL RESERVE BANKS
Millions of dollars
A13
Maturity Distribution of Loan and Security Holdings
Type and maturity groupings
Apr. 27
May 4
Wednesday
End of month
1983
1983
May 11
May 25
May 18
Mar. 31
Apr. 29
May 31
1 Loans—Total
2 Within 15 days
3 16 days to 90 days
4 91 days to 1 year
4,073
4,040
33
0
798
744
54
0
1,170
1,132
38
0
2,028
2,011
17
0
1,548
1,508
40
0
2,808
2,782
26
0
848
805
43
0
1,260
1,220
40
0
5 Acceptances—Total
6 Within 15 days
7 16 days to 90 days
8 91 days to 1 year
285
285
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
704
704
0
0
0
0
0
0
9 U.S. government securities—Total
10 Within 15 days1
11 16 days to 90 days
12 91 days to 1 year
H Over 1 year to 5 years
14 Over 5 years to 10 years
15 Over 10 years
141,108
6,694
29,095
43,736
31,972
12,828
16,783
138,331
5,771
26,726
44,734
31,489
12,828
16,783
136,869
6,269
24,799
44,701
31,489
12,828
16,783
141,297
7,822
30,918
40,807
32,983
11,700
17,067
140,750
6,335
30,501
42,165
32,983
11,700
17,066
136,651
3,525
26,664
44,879
31,830
12,970
16,783
141,550
4,947
30,724
44,296
31,972
12,828
16,783
141,180
4,011
32,654
42,680
33,067
11,700
17,068
16 Federal agency obligations—Total
17 Within 15 days1
18 16 days to 90 days
19 91 days to 1 year
20 Over 1 year to 5 years
21 Over 5 years to 10 years
22 Over 10 years
8,995
323
499
2,026
4,499
1,130
518
8,908
126
581
2,054
4,499
1,130
518
8,908
32
549
2,095
4,529
1,185
518
8,908
93
489
2,094
4,540
1,174
518
8,908
61
489
2,200
4,450
1,190
518
8,915
309
508
1,862
4,614
1,104
518
9,156
484
499
2,026
4,499
1,130
518
8,908
188
585
1,977
4,450
1,190
518
1. Holdings under repurchase agreements are classified as maturing within 15 days in accordance with maximum maturity of the agreements.
A14
1.20
DomesticNonfinancialStatistics • June 1983
AGGREGATE RESERVES OF DEPOSITORY INSTITUTIONS AND MONETARY BASE
Billions of dollars, averages of daily figures
Item
1978
Dec.
1979
Dec.
1980
Dec.
1981
Dec.
1982
Oct.
Nov.
1983
Dec.
Jan.
Feb.
Mar.
Apr.
May
Seasonally adjusted
ADJUSTED FOR
CHANGES IN RESERVE REQUIREMENTS'
1 Total reserves2
32.83
34.23
36.23
37.93
39.93
40.41
40.78
40.12
40.34
41.00
41.31
41.27
2 Nonborrowed reserves
3 Required reserves
4 Monetary base3
31.96
32.59
132.2
32.76
33.91
142.8
34.54
35.71
154.9
39.45
39.53
173.2
39.45
39.53
173.2
39.79
40.01
174.3
40.15
40.28
175.6
39.59
39.57
176.3
39.76
39.91
178.0
40.21
40.57
180.2
40.30
40.83
181.2
40.32
40.80
182.9
Not seasonally adjusted
5 Total reserves2
33.33
37.24
37.24
40.00
40.00
40.68
41.56
42.23
40.23
40.23
41.05
40.74
6 Nonborrowed reserves
7 Required reserves
8 Monetary base3
32.46
33.10
134.7
35.55
36.72
158.2
35.55
36.72
158.2
39.52
39.59
173.2
39.52
39.59
173.2
40.06
40.28
175.4
40.93
41.06
178.9
41.69
41.67
177.7
39.64
39.79
175.9
39.44
39.80
177.7
40.04
40.58
180.3
39.78
40.27
181.8
41.68
40.66
40.66
40.59
40.59
41.20
41.85
41.86
39.80
38.04
38.65
38.31
40.81
41.45
144.5
38.97
40.15
162.5
38.97
40.15
162.5
40.11
40.18
173.8
40.11
40.18
173.8
40.58
40.80
176.0
41.22
41.35
179.3
41.33
41.32
177.9
39.22
39.36
176.0
37.24
37.60
175.9
37.65
38.18
178.4
37.36
37.84
179.9
NOT ADJUSTED FOR
CHANGES IN RESERVE REQUIREMENTS4
9 Total reserves2
10 Nonborrowed reserves
11 Required reserves
12 Monetary base3
1. Reserve aggregates include required reserves of member banks and Edge
Act corporations and other depository institutions. Discontinuities associated
with the implementation of the Monetary Control Act, the inclusion of Edge Act
corporation reserves, and other changes in Regulation D have been removed.
Beginning with the week ended December 23, 1981, reserve aggregates have been
reduced by shifts of reservable liabilities to international banking facilities (IBFs).
On the basis of reports of liabilities transferred to IBFs by U.S. commercial banks
and U.S. agencies and branches of foreign banks, it is estimated that required
reserves were lowered on average $10 millon to $20 million in December 1981 and
$40 million to $70 million in January 1982.
2. Reserve balances with Federal Reserve Banks (which exclude required
clearing balances) plus vault cash at institutions with required reserve balances
plus vault cash equal to required reserves at other institutions.
3. Includes reserve balances and required clearing balances at Federal Reserve
Banks in the current week plus vault cash held two weeks earlier used to satisfy
reserve requirements at all depository institutions plus currency outside the U.S.
Treasury, Federal Reserve Banks, the vaults of depository institutions, and
surplus vault cash at depository institutions.
4. Reserves of depository institutions series reflect actual reserve requirement
percentages with no adjustments to eliminate the effect of changes in Regulation D
including changes associated with the implementation of the Monetary Control
Act. Includes required reserves of member banks and Edge Act corporations and
beginning November 13, 1980, other depository institutions. Under the transition-
al phase-in program of the Monetary Control Act of 1980, the net changes in
required reserves of depository institutions have been as follows: Effective
November 13, 1980, a reduction of $2.9 billion; February 12, 1981, an increase of
$245 million; March 12, 1981, an increase of $75 million; May 14, 1981, an increase
of $245 million; September 3, 1981, a reduction of $1.1 billion; November 12,
1981, an increase of $210 million; January 14, 1982, a reduction of $60 million;
February 11, 1982 an increase of $170 million; March 4, 1982, an estimated
reduction of $2.0 billion; May 13, 1982, an estimated increase of $150 million;
August 12, 1982 an estimated increase of $140 million; and September 2, 1982, an
estimated reduction of $1.2 billion; October 28, 1982 an estimated reduction of
$100 million; December 23, 1982 an estimated reduction of $800 million; and
March 3, 1983 an estimated reduction of $2.1 billion. Beginning with the week
ended December 23, 1981, reserve aggregates have been reduced by shifts of
reservable liabilities to IBFs. On the basis of reports of liabilities transferred to
IBFs by U.S. commercial banks and U.S. agencies and branches offoreign banks,
it is estimated that required reserves were lowered on average by $60 million to
$90 million in December 1981 and $180 million to $230 million in January 1982,
mostly reflecting a reduction in reservable Eurocurrency transactions.
NOTE. Latest monthly and weekly figures are available from the Board's
H.3(502) statistical release. Back data and estimates of the impact on required
reserves and changes in reserve requirements are available from the Banking
Section, Division of Research and Statistics, Board of Governors of the Federal
Reserve System, Washington, D.C. 20551.
Monetary Aggregates
1.21
A15
MONEY STOCK MEASURES AND COMPONENTS
Billions of dollars, averages of daily figures
1983
Item
1979
Dec.
1981
Dec.
1980
Dec.
1982
Dec.
Jan.
Feb.
Mar.'
Apr.
Seasonally adjusted
MEASURES'
1
2
3
4
Ml
M2
M3
L2
389.0
1,497.5
1,758.4
2,131.8
414.1
1,630.3
1,936.7
2,343.6
440.6
1,794.9
2,167.9
2,622.0
478.2
1,959.5
2,377.6
2,896.8'
482.1
2,010.0'
2,403.3
n.a.
491.1
2,050.8
2,430.6
n.a.
497.6
2,070.0
2,447.3
n.a.
496.5
2,074.9
2,456.0
n.a.
106.5
3.7
262.0
17.0
423.1
635.9
222.2
116.2
4.1
266.8
26.9
400.7
731.7
258.9
123.2
4.5
236.4
76.6
344.4
828.6
302.6
132.8
4.2
239.8
101.3r
359.3
859.1
333.8
134.2
4.1
239.4
104.5'
335.1
797.4
310.7'
135.6
4.3
238.7
112.5
325.7
755.1
297.9
137.0
4.5
240.1
116.0
322.8
733.8
296.3
138.0
4.6
238.9
115.0
321.9
725.7
300.8
SELECTED COMPONENTS
5
6
7
8
9
10
11
Currency
Traveler's checks3
Demand deposits
Other checkable 5deposits4
Savings deposits
Small-denomination time deposits6
Large-denomination time deposits7
Not seasonally adjusted
MEASURES'
12
13
14
15
Ml
M2
M3
L2
398.8
1,502.1
1,766.1
2,138.9
424.7
1,635.0
1,944.9
2,350.8
452.1
1,799.6
2,175.9
2,629.7
491.0
1,964.5
2,385.3
2,904.7'
489.7'
2,018.3'
2,415.2'
n.a.
480.7'
2,042.5
2,427.0'
n.a.
489.2
2,066.0
2,446.0
n.a.
504.4
2,088.6
2,467.5
n.a.
108.2
3.5
270.1
17.0
21.2
420.7
n.a.
633.1
118.3
3.9
275.2
27.2
28.4
398.3
n.a.
728.3
125.4
4.3
244.0
78.4
36.1
342.1
n.a.
824.1
135.2
4.0
247.7
104.C
44.3
356.2
26.5
853.9
133.2
3.9
245.1
107.5'
47.3
332.1
114.2
798.6
133.7
4.1
232.8
110.0'
49.1'
321.0'
163.3
758.5
135.4
4.3
235.2
114.3'
48.6
319.5
185.9
737.7
137.4
4.4
242.4
120.3'
50.4
321.5
198.0
728.7
33.4
9.5
226.0
61.4
14.9
262.4
150.9
36.0
305.9
182.2
47.6
336.5
166.7
46.1
314.2
159.6'
45.2
302.6
154.0
43.5
299.0
146.7
41.0
298.6
SELECTED COMPONENTS
16
17
18
19
20
21
22
23
Currency
Traveler's checks3
Demand deposits
Other checkable deposits4
Overnight RPs and
Eurodollars8
Savings deposits5
Money market deposit accounts 6
Small-denomination time deposits
Money market mutual funds
24 General purpose and broker/dealer
25 Institution only
26 Large-denomination time deposits7
1. Composition of the money stock measures is as follows:
Ml: Averages of daily figures for (1) currency outside the Treasury, Federal
Reserve Banks, and the vaults of commercial banks; (2) traveler's checks of
nonbank issuers; (3) demand deposits at all commercial banks other than those
due to domestic banks, the U.S. government, and foreign banks and official
institutions less cash items in the process of collection and Federal Reserve float;
and (4) negotiable order of withdrawal (NOW) and automatic transfer service
(ATS) accounts at banks and thrift institutions, credit union share draft (CUSD)
accounts, and demand deposits at mutual savings banks.
M2: Ml plus money market deposit accounts, savings, and small-denomination
time deposits at all depository institutions, overnight repurchase agreements at
commercial banks, overnight Eurodollars held by U.S. residents other than banks
at Caribbean branches of member banks and balances of money market mutual
funds (general purpose and broker/dealer).
M3: M2 plus large-denomination time deposits at all depository institutions,
term RPs at commercial banks and savings and loan associations, and balances of
institution-only money market mutual funds.
2. L: M3 plus other liquid assets such as term Eurodollars held by U.S.
residents other than banks, bankers acceptances, commercial paper, Treasury
bills and other liquid Treasury securities, and U.S. savings bonds.
3. Outstanding amount of U.S. dollar-denominated traveler's checks of nonbank issuers.
4. Includes ATS and NOW balances at all institutions, credit union share draft
balances, and demand deposits at mutual savings banks.
5. Excludes NOW and ATS accounts at commercial banks and thrift institutions and CUSDs at credit unions and all money market deposit accounts
(MMDAs).
6. Issued in amounts of less than $100,000 and includes retail RPs.
7. Issued in amounts of $100,000 or more and are net of the holdings of
domestic banks, thrift institutions, the U.S. government, money market mutual
funds, and foreign banks and official institutions.
8. Overnight (and continuing contract) RPs are those issued by commercial
banks to other than depository institutions and money market mutual funds
(general purpose and broker/dealer), and overnight Eurodollars are those issued
by Caribbean branches of member banks to U.S. residents other than depository
institutions and money market mutual funds (general purpose and broker/dealer).
NOTE: Latest monthly and weekly figures are available from the Board's H.6
(508) release. Back data are available from the Banking Section, Division of
Research and Statistics, Board of Governors of the Federal Reserve System,
Washington, D.C. 20551.
A16
1.22
DomesticNonfinancialStatistics • June 1983
BANK DEBITS AND DEPOSIT TURNOVER
Debits are shown in billions of dollars, turnover as ratio of debits to deposits. Monthly data are at annual rates.
1982
Bank group, or type of customer
1980'
19811
1983
1982'
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Seasonally adjusted
DEBITS TO
1
2
3
4
5
Demand deposits2
All insured banks
Major New York City banks
Other banks
3
ATS-NOW accounts
Savings deposits4
6
7
8
9
10
Demand deposits2
All insured banks
Major New York City banks
Other banks
3
ATS-NOW accounts
Savings deposits4
62,757.8
25,156.1
37,601.7
159.3
670.0
80,858.7
33,891.9
46,966.9
743.4
672.7
90,914.4
37,932.9
52,981.6
1,036.2
721.4
97,097.0
42,077.9
55,019.1
1,109.4
637.0
95,475.9
38,971.6
56,504.4
1,224.6
697.1
97,748.5
42,104.4
55,644.1
1,448.1
889.3
103,333.1
46,353.0
56,980.1
1,262.3
904.3
102,743.5
45,133.2
57,610.3
1,286.4
827.9
102,206.1
44,327.4
57,878.7
1,369.4
803.2
198.7
803.7
132.2
9.7
3.6
285.8
1,105.1
186.2
14.0
4.1
324.2
1,287.6
211.1
14.5
4.5
343.0
1,298.7
219.5
14.7
4.0
333.8
1,263.7
221.4
15.6
4.3
342.6
1,381.2
218.3
18.4
4.7
361.1
1,462.3
223.9
15.8
6.0
361.3
1,462.5
227.2
15.1
5.8
356.1
1,437.4
225.9
15.6
5.7
DEPOSIT TURNOVER
Not seasonally adjusted
DEBITS TO
11
12
N
14
15
16
Demand deposits2
All insured banks
Major New York City banks
Other banks
ATS-NOW
accounts3
MMDA5
Savings deposits4
17
18
19
20
71
22
Demand deposits2
All insured banks
Major New York City banks
Other banks
ATS-NOW
accounts3
MMDA5
Savings deposits4
63,124.4
25,243.1
37,881.3
158.0
0
669.8
81,197.9
34,032.0
47,165.9
737.6
0
672.9
91,031.9
38,001.0
53,030.9
1,027.1
0
720.0
93,543.3
39,657.6
53,885.7
1,098.0
0
672.7
91,838.3
36,893.5
54,944.8
1,115.0
0
663.3
107,454.9
47,576.3
59,878.6
1,411.9
0
878.0
101,566.1
45,657.2
55,908.8
1,525.5
278:4
980.4
92,654.1
40,937.3
51,716.8
1,198.7
324.7
754.3
109,166.3
47,496.6
61,669.7
1,398.4
454.9
820.4
202.3
814.8
134.8
9.7
0
3.6
286.1
1,114.2
186.2
14.0
0
4.1
325.0
1,295.7
211.5
14.3
0
4.5
327.8
1,220.8
213.1
14.5
0
4.2
319.3
1,198.6
213.9
14.1
0
4.1
367.2
1,540.7
228.8
17.5
0
4.7
346.1
1,368.1
215.0
18.6
2.4
6.6
334.8
1,366.7
209.5
14.4
2.0
5.3
391.8
1,561.1
248.5
16.2
2.4
5.8
DEPOSIT TURNOVER
1. Annual averages of monthly figures.
2. Represents accounts of individuals, partnerships, and corporations and of
states and political subdivisions.
3. Accounts authorized for negotiable orders of withdrawal (NOW) and accounts authorized for automatic transfer to demand deposits (ATS). ATS data
availability starts with December 1978.
4. Excludes ATS and NOW accounts, MMDA and special club accounts, such
as Christmas and vacation clubs.
5. Money Market Deposit Accounts.
NOTE. Historical data for demand deposits are available back to 1970 estimated
in part from the debits series for 233 SMSA's that were available through June
1977. Historical data for ATS-NOW and savings deposits are available back to
July 1977. Back data are available on request from the Banking Section, Division
of Research and Statistics, Board of Governors of the Federal Reserve System,
Washington, D.C. 20551.
Commercial
1.23
LOANS AND SECURITIES
Banks
A17
All Commercial Banks1
Billions of dollars; averages of Wednesday figures
1981
1982
Dec.2
Dec.
1983
1981
1982
Dec.2
Dec.
1983
Category
Jan.3
Feb.
Mar.
Apr.
2 U.S. Treasury securities
3 Other securities
4 Total loans and leases4
5 Commercial and industrial
loans
6 Real estate loans
7 Loans to individuals
8 Security loans
9 Loans to nonbank financial
institutions
10 Agricultural loans
11 Lease financing receivables....
12 All other loans
Feb.
Mar.
Apr.
Not seasonally adjusted
Seasonally adjusted
1 Total loans and securities4
Jan.3
1,316.3
1,412.1
1,428.2
1,436.5
1,450.2
1,460.9
1,326.1
1,422.5
1,430.5
1,432.2
1,445.0
1,460.2
111.0
231.4
973.9
130.9
239.1
1,042.0
139.8
243.3
1,045.1
144.5
243.2
1,048.8
151.0
242.8
1,056.3
157.9
243.4
1,059.6
111.4
232.8
981.8
131.5
240.6
1,050.4
139.3
243.5
1,047.7
145.1
242.6
1,044.4
153.2
242.3
1,049.5
160.7
243.4
1,056.1
358.0
285.7
185.1
21.9
392.4
303.2
191.8
24.7
395.2
305.3
192.6
22.7
394.9
307.6
192.9
22.2
396.2
309.5
194.8
22.6
393.0
311.4
196.0
22.9
360.1
286.8
186.4
22.7
394.7
304.1
193.1
25.5
394.2
305.9
193.2
22.9
393.4
307.3
192.3
21.5
395.1
308.6
193.0
22.0
395.2
310.4
194.7
22.9
30.2
33.0
12.7
47.2
31.1
36.1
13.1
49.7
31.7
36.4
13.3
47.8
31.6
36.7
13.3
49.6
32.0
37.1
13.1
51.0
31.6
37.2
13.1
54.3
31.2
33.0
12.7
49.2
32.1
36.1
13.1
51.7
31.9
36.1
13.3
50.3
31.7
36.1
13.3
48.8
31.6
36.3
13.1
49.8
31.3
36.6
13.1
51.9
1,319.1
1,415.0
1,431.2
1,439.4
1,453.1
1,463.8
1,328.9
1,425.4
1,433.5
1,435.1
1,448.0
1,463.2
976.7
2.8
1,045.0
2.9
1,048.0
3.0
1,051.7
3.0
1,059.3
3.0
1,062.6
3.0
984.7
2.8
1,053.3
2.9
1,050.7
3.0
1,047.4
3.0
1,052.5
3.0
1,059.1
3.0
360.2
394.6
397.5
397.2
398.6
395.4
362.3
396.9
396.5
395.8
397.4
397.6
2.2
8.9
2.3
8.5
2.3
8.8
2.3
8.2
2.4
8.9
2.4
8.9
2.2
9.8
2.3
9.5
2.3
9.2
2.3
8.4
2.4
8.5
2.4
8.2
349.1
334.9
14.2
19.0
383.8
373.5
10.3
13.5
386.4
374.1
12.3
13.7
386.7
374.5
12.2
14.3
387.3
375.0
12.3
14.9
384.1
372.2
11.9
15.2
350.3
334.3
16.1
20.0
385.2
372.7
12.4
14.5
384.9
372.7
12.2
14.3
385.1
372.8
12.3
14.1
386.6
374.4
12.2
14.6
387.0
375.2
11.8
14.6
MEMO:
13 Total loans and4 5securities plus
loans sold '
14 Total loans plus loans sold4-45 5 . . . .
15 Total loans sold to affiliates '
16 Commercial and industrial
loans
plus loans sold5
17 Commercial and
industrial
loans sold5
18 Acceptances held
19 Other commercial and industrial loans
20
To U.S. addressees6
21
To non-U.S. addressees
22 Loans to foreign banks
1. Includes domestically chartered banks; U.S. branches and agencies of
foreign banks, New York investment companies majority owned by foreign
banks, ahd Edge Act corporations owned by domestically chartered and foreign
banks.
2. Beginning December 1981, shifts of foreign loans and securities from U.S.
banking offices to international banking facilities (IBFs) reduced the levels of
several items. Seasonally adjusted data that include adjustments for the amounts
shifted from domestic offices to IBFs are available in the Board's G.7 (407)
statistical release (available from Publications Services, Board of Governors of
the Federal Reserve System, Washington, D.C. 20551).
3. Due to loan reclassifications, several categories have breaks in series:
beginning Jan. 12, 1983, real estate loans increased $0.4 billion and loans to
individuals decreased $0.2 billion. As of Jan. 26, 1983, other securities increased
$0.2 billion and total loans and commercial and industrial loans decreased $0.2
billion. As of Feb. 2, 1983, real estate loans increased $0.5 billion and commercial
and industrial loans decreased $0.5 billion.
4. Excludes loans to commercial banks in the United States.
5. Loans sold are those sold outright to a bank's own foreign branches,
nonconsolidated nonbank affiliates of the bank, the bank's holding company (if
not a bank), and nonconsolidated nonbank subsidiaries of the holding company.
6. United States includes the 50 states and the District of Columbia.
NOTE. Data are prorated averages of Wednesday estimates for domestically
chartered banks, based on weekly reports of a sample of domestically chartered
banks and quarterly reports of all domestically chartered banks. For foreignrelated institutions, data are averages of month-end estimates based on weekly
reports from large agencies and branches and quarterly reports from all agencies,
branches, investment companies, and Edge Act corporations engaged in banking.
A18
1.24
DomesticNonfinancialStatistics • June 1983
MAJOR NONDEPOSIT FUNDS OF COMMERCIAL BANKS 1
Monthly averages, billions of dollars
1981
1982
1983
Source
Dec.
1
2
3
4
5
6
Total nondeposit funds2
Seasonally adjusted
Not seasonally adjusted
Federal funds, RPs,3 and other borrowings
from nonbanks
Seasonally adjusted
Not seasonally adjusted
Net balances due to foreign-related institutions, not seasonally adjusted
Loans sold to4 affiliates, not seasonally
adjusted
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
96.0
97.5
89.7
91.2
85.0
86.7
81.7
85.4
78.4
80.8
80.6
82.8
86.7
88.7
82.1
83.5
72.3
73.8
75.6
76.5
75.7
76.2
80.0
78.6
111.5
113.0
119.0
120.5
119.3
121.0
120.2
123.9
121.6
124.0
126.1
128.3
129.1
131.1
127.3
128.8
131.6
133.1
134.6
135.5
134.5
135.2
141.5
137.6
-18.2
-32.2
-37.3
-41.3
-46.3
-48.0
-44.8
-48.1
-62.4
-62.0
-61.9
-61.9
2.8
3.0
2.8
2.8
2.8
2.8
2.9
2.9
3.0
3.0
3.0
3.0
-22.5
54.9
32.4
-29.2
57.7
28.5
-33.1
60.7
27.6
-34.5
65.2
30.8
-39.0
68.8
29.7
-40.3
69.6
29.4
-38.3
69.9
31.6
-39.8
72.4
32.6
-50.1
79.3
29.2
-50.5
78.8
28.3
-52.8
79.8
26.9
-52.5
80.0
27.5
4.3
48.1
52.4
-2.9
50.2
47.3
-4.3
52.9
48.6
-6.9
53.8
46.9
-7.3
54.6
47.3
-7.8
54.1
46.4
-6.5
53.7
47.2
-8.3
54.9
46.6
-12.3
57.6
45.3
-11.5
56.1
44.6
-9.1
56.1
47.1
-9.4
55.9
46.5
59.0
59.2
61.7
61.7
61.9
62.2
65.2
67.5
65.0
66.0
69.0
69.8
71.5
72.1
71.0
71.1
72.2
72.2
74.3
73.7
74.5
73.7
79.2
76.2
12.2
11.1
10.5
10.7
9.0
8.2
10.1
8.1
11.1
12.3
14.4
16.4
10.6
7.8
11.9
10.8
15.7
16.3
8.8
10.2
12.5
13.2
13.5
14.2
324.1
330.4
349.6
344.8
360.3
350.6
367.1
359.3
366.7
361.8
376.6
364.9
360.6
361.7
347.3
353.9
319.2
325.4
303.0
310.4
295.9
300.6
296.0
292.7
22.4
1.7
20.7
3.1
17.6
32.0
2.4
29.6
5.0
24.6
32.2
2.4
29.8
5.1
24.7
32.5
2.4
30.1
5.3
24.9
32.8
2.4
30.4
5.4
25.0
33.1
2.4
30.7
5.4
25.3
33.3
2.4
30.9
5.5
25.4
33.9
2.4
31.5
5.8
25.7
34.2
2.4
31.8
5.8
26.0
MEMO
7 Domestically chartered banks' net positions
with own foreign
branches, not seasonally adjusted5
8 Gross due from balances
9 Gross due to balances
10 Foreign-related institutions' net positions with
directly related
institutions, not seasonally adjusted6
11 Gross due from balances
12 Gross due to balances
Security RP borrowings
13 Seasonally adjusted'
14 Not seasonally adjusted
U.S. Treasury demand balances8
15 Seasonally adjusted
16 Not seasonally adjusted
Time deposits, $100,000 or more9
17 Seasonally adjusted
18 Not seasonally adjusted
I B F ADJUSTMENTS FOR SELECTED ITEMS10
19
20
21 Item 5
22 Item 7
23 Item 10
1. Commercial banks are those in the 50 states and the District of Columbia
with national or state charters plus agencies and branches of foreign banks, New
York investment companies majority owned by foreign banks, and Edge Act
corporations owned by domestically chartered and foreign banks.
2. Includes seasonally adjusted federal funds, RPs, and other borrowings from
nonbanks and not seasonally adjusted net Eurodollars and loans to affiliates.
Includes averages of Wednesday data for domestically chartered banks and
averages of current and previous month-end data for foreign-related institutions.
3. Other borrowings are borrowings on any instrument, such as a promissory
note or due bill, given for the purpose of borrowing money for the banking
business. This includes borrowings from Federal Reserve Banks and from foreign
banks, term federal funds, overdrawn due from bank balances, loan RPs, and
participations in pooled loans. Includes averages of daily figures for member
banks and averages of current and previous month-end data for foreign-related
institutions.
4. Loans initially booked by the bank and later sold to affiliates that are still
held by affiliates. Averages of Wednesday data.
5. Averages of daily figures for member and nonmember banks.
6. Averages of daily data.
7. Based on daily average data reported by 122 large banks.
8. Includes U.S. Treasury demand deposits and Treasury tax-and-loan notes at
commercial banks. Averages of daily data.
9. Averages of Wednesday figures.
10. Estimated effects of shifts of foreign assets from U.S. banking offices to
international banking facilities (IBFs).
Banking Institutions
1.25
ASSETS AND LIABILITIES OF COMMERCIAL BANKING INSTITUTIONS
A19
Last-Wednesday-of-Month Series
Billions of dollars except for number of banks
1983
1982
July
Aug.
Sept.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
May
DOMESTICALLY CHARTERED
COMMERCIAL BANKS1
1
2
3
4
5
6
Loans and securities, excluding
interbank
Loans, excluding interbank
Commercial and industrial
Other
U.S. Treasury securities
Other securities
1,313.2
966.6
346.4
620.3
113.4
233.2
1,318.8
970.6
346.2
624.4
113.7
234.5
1,337.1
985.9
354.4
631.5
115.0
236.2
1,343.0
988.5
355.8
632.7
119.4
235.1
1,347.0
990.4
355.4
635.0
122.2
234.4
1,370.4
1,000.8
357.9
642.9
129.0
240.5
1,370.8
993.3
355.6
638.2
136.0
241.6
1,373.7
991.4
356.3
635.8
141.4
240.8
1,392.2
1,001.7
358.6
643.7
150.6
239.9
1,404.0
1,004.6
358.5
646.8
155.5
243.9
1,411.9
1,006.9
357.3
650.8
160.9
244.1
154.5
20.5
25.1
55.4
53.6
160.8
20.3
26.1
58.8
55.5
157.4
20.4
17.0
60.4
59.6
162.1
20.5
23.5
61.3
56.8
169.7
19.0
22.0
64.6
64.1
184.4
23.0
25.4
67.6
68.4
167.8
20.4
23.9
67.7
55.9
184.7
20.3
25.3
71.6
67.5
168.9
19.9
20.5
67.1
61.5
170.1
20.4
23.9
66.1
59.6
164.5
20.3
22.4
65.6
56.3
7
8
9
10
11
Cash assets, total
Currency and coin
Reserves with Federal Reserve Banks
Balances with depository institutions .
Cash items in process of collection . . .
12
Other assets2
224.2
231.3
234.9
237.0
241.8
265.3
260.1
263.6
257.9
252.4
248.3
13
Total assets/total liabilities and capital . . .
1,692.0
1,710.9
1,729.3
1,742.1
1,758.6
1,820.1
1,798.7
1,822.0
1,818.9
1,826.3
1,824.9
14
15
16
17
Deposits
Demand
Savings
Time
1,266.4
314.4
227.1
724.8
1,279.1
315.5
229.5
734.1
1,290.7
323.0
230.9
736.8
1,300.2
326.5
238.2
735.4
1,316.9
338.1
244.9
733.9
1,361.8
363.9
296.4
701.5
1,340.6
324.0
361.5
655.1
1,368.3
337.9
395.2
635.2
1,374.2
333.4
419.2
621.6
1,368.0
329.2
426.9
611.9
1,370.8
324.5
440.2
606.1
18
19
20
Borrowings
Other liabilities
Residual (assets less liabilities)
195.4
99.1
131.1
196.0
103.9
131.9
202.8
103.4
132.5
203.7
106.2
132.0
198.1
109.3
134.3
215.1
109.2
133.9
221.6
106.4
130.1
218.0
106.0
129.6
211.3
103.5
130.0
224.0
102.3
132.0
214.1
104.7
135.1
8.0
14,752
5.9
14,770
17.0
14,785
11.7
14,797
2.4
14,782
10.7
14,787
17.1
14,780
7.0
14,812
9.6
14,819
17.8
14,823
2.7
14,817
1,371.3
1,020.8
384.4
636.4
115.7
234.8
1,376.6
1,024.7
384.5
640.2
115.8
236.1
1,397.3
1,042.4
395.0
647.4
117.2
237.7
1,401.7
1,042.3
393.7
648.6
122.7
236.7
1,413.7
1,052.1
398.9
653.2
125.7
235.9
1,429.8
1,054.9
396.5
658.4
132.8
242.1
1,427.5
1,044.8
393.0
652.4
139.5
243.2
1,429.8
1,042.3
392.9
650.0
145.1
242.4
1,451.3
1,054.5
396.5
658.6
155.3
241.5
1,461.0
1,055.2
394.1
661.8
160.3
245.5
1,467.6
1,055.9
392.3
664.7
166.1
245.8
200.5
20.3
26.7
84.9
68.6
185.5
19.9
22.0
81.0
62.6
186.3
20.4
25.4
79.8
60.7
180.3
20.3
23.8
78.9
57.3
MEMO;
21
22
U.S. Treasury note balances included in
borrowing
Number of banks
ALL COMMERCIAL BANKING
INSTITUTIONS3
24
25
26
27
28
Loans and securities, excluding
interbank
Loans, excluding interbank
Commercial and industrial
Other
U.S. Treasury securities
Other securities
29
30
31
32
33
Cash assets, total
Currency and coin
Reserves with Federal Reserve Banks
Balances with depository institutions .
Cash items in process of collection . . .
169.3
20.5
26.5
67.8
54.6
176.2
20.4
27.5
71.8
56.5
173.7
20.4
18.4
74.2
60.6
178.7
20.5
25.0
75.3
57.8
181.2
19.0
23.4
74.4
64.3
200.7
23.0
26.8
81.4
69.4
183.7
20.4
25.3
81.1
56.9
34
Other assets2
299.4
306.8
310.3
313.9
323.3
341.7
333.2
330.2
325.4
317.7
309.5
1,962.2
1,964.9
1,957.5
23
35
Total assets/total liabilities and capital...
1,840.1
1,859.6
1,881.3
1,894.2
1,918.2
1,972.2
1,944.4
1,960.4
36
37
38
39
Deposits
Demand
Savings
Time
1,307.3
326.8
227.4
753.1
1,321.7
327.7
229.7
764.3
1,335.5
335.1
231.1
769.2
1,345.2
338.9
238.5
767.8
1,358.1
344.9
245.1
768.0
1,409.7
376.2
296.7
736.7
1,385.4
335.9
361.9
687.7
1,412.6
350.2
395.6
666.8
1,419.5
345.7
419.7
654.1
1,411.0
341.1
427.3
642.6
1,413.1
336.4
440.7
636.0
40
41
42
Borrowings
Other liabilities
Residual (assets less liabilities)
260.0
139.8
133.0
260.0
144.1
133.8
267.6
143.8
134.4
268.3
146.9
133.9
267.0
156.6
136.6
278.3
148.4
135.8
283.5
143.5
132.0
276.0
140.4
131.5
269.9
141.1
131.9
281.3
138.7
133.9
269.5
137.9
137.0
8.0
15,271
5.9
15,289
17.0
15,311
11.7
15,330
2.4
15,318
10.7
15,329
17.1
15,332
7.0
15,366
9.6
15,376
17.8
15,390
2.7
15,385
MEMO:
43
44
U.S. Treasury note balances included in
borrowing
Number of banks
1. Domestically chartered commercial banks include all commercial banks in
the United States except branches of foreign banks; included are member and
nonmember banks, stock savings banks, and nondeposit trust companies.
2. Other assets include loans to U.S. commercial banks.
3. Commercial banking institutions include domestically chartered commercial
banks, branches and agencies of foreign banks, Edge Act and Agreement
corporations, and New York State foreign investment corporations.
NOTE. Figures are partly estimated. They include all bank-premises subsidiaries and other significant majority-owned domestic subsidiaries. Data for domestically chartered commercial banks are for the last Wednesday of the month. Data
for other banking institutions are estimates made on the last Wednesday of the
month based on a weekly reporting sample of foreign-related institutions and
quarter-end condition report data.
A20
DomesticNonfinancialStatistics • June 1983
1.26 ALL LARGE WEEKLY REPORTING COMMERCIAL BANKS with Domestic Assets of $750 Million or More on
December 31, 1977, Assets and Liabilities
Millions of dollars, Wednesday figures
1983
Account
Mar.
1 Cash items in process of collection
2 Demand deposits due from banks in the United States..
3 All other cash and due from depository institutions . . . .
4 Total loans and securities
Securities
5 U.S. Treasury securities
6
Trading account
7
Investment account, by maturity
8
One year or less
Over one through five years
9
10
Over five years
11 Other securities
12
Trading account
13
Investment account
14
U.S. government agencies
15
States and political subdivisions, by maturity
16
One year or less
17
Over one year
18
Other bonds, corporate stocks and securities
Loans
1
19 Federal funds sold
20
To commercial banks
21
To nonbank brokers and dealers in securities
To others
22
23 Other loans, gross
24
Commercial and industrial
25
Bankers acceptances and commercial paper
26
All other
27
U.S. addressees
28
Non-U.S. addressees
Real estate
29
30
To individuals for personal expenditures
To financial institutions
31
Commercial banks in the United States
32
Banks in foreign countries
33
Sales finance, personal finance companies, etc
34
Other financial institutions
35
To nonbank brokers and dealers in securities 2
To others for purchasing and carrying securities . . . .
36
37
To finance agricultural production
All other
38
39 LESS: Unearned income
Loan loss reserve
40
41 Other loans, net
42 Lease financing receivables
43 All other assets
44 Total assets
Deposits
45 Demand deposits
46
Mutual savings banks
47
Individuals, partnerships, and corporations
48
States and political subdivisions
49
U.S. government
50
Commercial banks in the United States
51
Banks in foreign countries
52
Foreign governments and official institutions
53
Certified and officers' checks
54 Time and savings deposits
55
Savings
Individuals and nonprofit organizations
56
57
Partnerships and corporations operated for profit ..
Domestic governmental units
58
59
All other
Time
60
Individuals, partnerships, and corporations
61
62
States and political subdivisions
63
U.S. government
64
Commercial banks in the United States
Foreign governments, official institutions, and
65
banks
Liabilities for borrowed money
66
67
68
69
70
71
Treasury tax-and-loan notes
All other liabilities for borrowed money3
Other liabilities and subordinated notes and debentures .
Total liabUities
Residual (total assets minus total liabilities)4
30
Apr.
Apr.
13
Apr.
20
Apr.
27p
May
4p
May IIP
May
18P
May
25p
49,325
6,788
33,978
52,165
7,095
32,359
49,457
6,691
31,061
50,748
7,309
33,591
47,572
6,599
35,833
52,362
7,287
31,989
47,365
6,566
32,358
50,071
7,002
35,159
43,484
6,826
34,433
652,512
668,910
662,138
662,077
657,064
666,383
661,926
660,384
657,721
49,098
8,510
40,587
12,996
24,971
2,621
81,523
4,679
76,844
16,220
57,083
6,663
50,420
3,542
51,389
9,467
41,922
13,901
25,358
2,662
81,783
5,294
76,489
16,209
56,735
6,541
50,194
3,544
51,964
10,196
41,768
13,744
25,366
2,658
81,603
4,931
76,672
16,231
56,850
6,625
50,225
3,592
51,809
10,495
41,314
13,335
25,360
2,618
83,943
6,624
77,319
16,553
57,182
7,086
50,096
3,584
50,996
9,878
41,118
13,217
25,248
2,653
84,151
6,602
77,549
16,757
57,314
7,042
50,272
3,478
52,444
10,224
42,220
13,419
26,065
84,563
7,365
77,198
16,766
56,988
7,028
49,960
3,444
53,2%
10,014
43,281
13,982
26,565
2,734
83,477
6,031
77,446
16,865
57,150
7,218
49,932
3,431
53,484
9,236
44,248
13,945
27,515
2,788
83,492
5,938
77,554
16,867
57,221
7,151
50,070
3,466
52,581
9,516
43,065
13,728
26,660
2,677
83,456
5,784
77,672
16,866
57,318
7,076
50,241
3,488
35,752
25,216
7,228
3,308
499,458
216,581
4,847
211,734
204,931
6,803
133,922
74,789
47,793
36,485
7,860
3,448
501,166
217,432
4,883
212,549
205,836
6,714
133,991
74,815
43,768
31,438
8,897
3,433
498,060
215,562
4,262
211,299
204,543
6,756
134,093
74,904
39,624
27,823
8,798
3,004
499,962
216,022
4,227
211,795
205,040
6,755
134,189
75,278
38,906
27,369
8,275
3,262
496,296
214,742
4,261
210,481
203,946
6,536
134,009
75,3%
42,880
31,123
8,569
3,188
499,843
216,333
4,730
211,602
204,645
6,957
133,981
75,478
42,482
31,836
8,122
2,524
496,059
214,345
4,485
209,860
203,038
6,822
133,919
75,343
40,508
30,350
7,555
2,603
496,281
213,016
3,880
209,136
202,298
6,837
134,207
75,319
40,877
30,305
7,830
2,742
494,301
212,600
3,499
209,101
202,253
6,847
134,209
75,432
7,586
7,585
10,504
16,077
8,138
2,673
6,638
14,964
5,327
7,991
486,139
11,058
141,703
7,576
7,842
10,598
15,836
7,532
2,727
6,693
16,124
5,320
7,901
487,945
11,076
146,750
7,583
7,715
10,323
15,906
7,845
2,655
6,782
14,692
5,325
7,932
484,803
11,081
144,585
7,700
7,486
10,173
15,911
8,160
2,824
6,841
15,376
5,307
7,954
486,700
11,095
144,023
7,999
7,024
9,490
15,811
7,217
2,793
6,808
15,007
5,282
8,003
483,011
11,074
140,470
8,242
7,469
9,398
16,239
8,215
2,777
6,857
14,854
5,215
8,131
486,4%
11,082
144,576
7,680
7,372
9,242
16,155
7,568
2,814
6,843
14,777
5,212
8,175
482,672
11,068
142,788
8,031
7,416
9,152
15,852
8,028
2,992
6,869
15,398
5,191
8,191
482,900
11,025
139,598
7,553
7,489
9,241
15,656
7,049
2,914
6,902
15,256
5,215
8,279
480,807
11,015
135,098
895,364
918,355
905,013
908,843
898,613
913,678
902,071
903,240
888,577
173,384
541
130,197
4,439
2,095
18,668
5,600
1,064
10,780
415,145
164,469
148,179
15,081
1,100
109
250,676
216,971
19,789
519
9,710
180,339
704
135,534
4,942
1,817
20,536
5,738
901
10,166
415,356
168,963
152,491
15,314
1,073
85
246,393
213,962
19,088
502
9,251
176,615
668
136,187
4,375
1,586
19,157
5,800
1,016
7,825
416,465
169,494
152,849
15,500
1,056
89
246,971
214,027
19,286
623
9,387
179,049
707
135,173
5,020
4,234
19,464
5,364
982
8,104
413,895
169,232
152,533
15,525
1,082
93
244,663
212,323
19,196
595
9,042
170,795
640
129,353
4,863
3,477
17,587
5,572
1,051
8,252
409,971
166,842
149,953
15,764
1,030
94
243,128
211,067
19,264
579
8,683
180,034
730
132,154
5,924
3,472
20,718
5,759
%1
10,316
409,700
169,255
152,135
15,939
1,083
97
240,445
209,452
18,659
526
8,287
172,014
608
132,138
4,594
2,107
17,874
5,768
1,016
7,908
409,528
170,165
152,788
16,218
1,068
91
239,362
208,417
18,842
349
8,216
174,279
683
130,807
4,771
2,757
19,913
5,502
974
8,871
408,680
171,430
153,684
16,555
1,101
90
237,250
206,508
18,651
350
8,307
166,138
581
126,675
4,622
1,548
18,691
5,626
988
7,408
409,685
172,086
154,228
16,702
1,068
88
237,599
208,044
18,685
357
7,144
3,686
3,589
3,648
3,507
3,536
3,521
3,538
3,434
3,369
1,196
7,583
156,391
82,533
140
3,548
177,602
81,483
3,674
165,571
82,606
570
12,897
161,425
81,172
3,229
13,919
159,573
81,533
145
11,513
170,014
82,000
543
9,163
169,892
80,432
1 222
6,956
169,779
81,995
684
1,517
166,465
83,957
836,232
858,468
844,930
849,008
839,020
853,406
841,572
842,911
828,446
59,132
59,888
60,082
59,835
59,593
60,272
60,499
60,329
60,130
1. Includes securities purchased under agreements to resell.
2. Other than financial institutions and brokers and dealers.
3. Includes federal funds purchased and securities sold under agreements to
repurchase; for information on these liabilities at banks with assets of $1 billion or
more on Dec. 31, 1977, see table 1.13.
6
2,US
4. Not a measure of equity capital for use in capital adequacy analysis or for
other analytic uses.
Weekly Reporting Banks
1.27
A21
LARGE WEEKLY REPORTING COMMERCIAL BANKS with Domestic Assets of $1 Billion or More on
December 31, 1977, Assets and Liabilities
Millions of dollars, Wednesday figures
1983
Account
Mar. 30
1 Cash items in process of collection
2 Demand deposits due from banks in the United States..
3 All other cash and due from depository institutions . . . .
4 Total loans and securities
Securities
5 U.S. Treasury securities
6 Trading account
7 Investment account, by maturity
8
One year or less
9
Over one through five years
10
Over five years
11 Other securities
12 Trading account
13 Investment account
14
U.S. government agencies
15
States and political subdivisions, by maturity
16
One year or less
17
Over one year
18
Other bonds, corporate stocks and securities
Loans
19 Federal funds sold1
20 To commercial banks
21 To nonbank brokers and dealers in securities
22 To others
23 Other loans, gross
24 Commercial and industrial
25
Bankers acceptances and commercial paper
26
All other
27
U.S. addressees
28
Non-U.S. addressees
29 Real estate
30 To individuals for personal expenditures
To financial institutions
Commercial banks in the United States
31
32
Banks in foreign countries
33
Sales finance, personal finance companies, etc
34
Other financial institutions
35 To nonbank brokers and dealers in securities 2
36 To others for purchasing and carrying securities . . . .
37 To finance agricultural production
38 All other
39 LESS: Unearned income
40
Loan loss reserve
41 Other loans, net
42 Lease financing receivables
43 All other assets
44 Total assets
Deposits
45 Demand deposits
46 Mutual savings banks
47 Individuals, partnerships, and corporations
48 States and political subdivisions
49 U.S. government
50 Commercial banks in the United States
51 Banks in foreign countries
52 Foreign governments and official institutions
53 Certified and officers' checks
54 Time and savings deposits
55 Savings
56
Individuals and nonprofit organizations
57
Partnerships and corporations operated for profit ..
58
Domestic governmental units
59
All other
60 Time
61
Individuals, partnerships, and corporations
62
States and political subdivisions
63
U.S. government
64
Commercial banks in the United States
65
Foreign governments, official institutions, and
banks
Liabilities for borrowed money
66
67 Treasury tax-and-loan notes
68 All other liabilities for borrowed money3
69 Other liabilities and subordinated notes and
debentures
70 Total liabilities
71 Residual (total assets minus total liabilities)4
Apr. 6
Apr. 20
Apr. 27p
May 4p
May 11?
May 18P
May 25?
46,745
6,272
31,020
606,847
49,227
6,535
29,653
621,652
46,480
6,128
28,331
615,042
47,438
6,709
30,406
615,260
44,575
6,024
32,794
610,775
49,302
6,767
29,306
619,094
44,698
6,058
29,508
615,204
47,207
6,429
32,317
613,827
40,918
6,282
31,422
611,891
44,674
8,341
36,333
11,293
22,672
2,367
74,191
4,527
69,664
14,818
51,657
5,917
45,739
3,189
46,901
9,249
37,652
12,130
23,114
2,408
74,500
5,140
69,360
14,824
51,350
5,806
45,544
3,185
47,498
10,005
37,493
11,982
23,109
2,403
74,244
4,735
69,509
14,868
51,423
5,894
45,530
3,218
47,376
10,280
37,096
11,632
23,101
2,364
76,485
6,477
70,008
15,133
51,666
6,305
45,362
3,209
46,614
9,656
36,958
11,579
22,980
2,399
76,628
6,490
70,138
15,245
51,796
6,258
45,537
3,097
48,032
10,025
38,007
11,681
23,826
2,500
76,930
7,182
69,748
15,192
51,506
6,226
45,280
3,050
48,889
9,883
39,006
12,214
24,293
2,499
75,903
5,875
70,028
15,298
51,667
6,409
45,258
3,063
48,967
9,071
39,896
12,160
25,183
2,553
75,798
5,684
70,114
15,298
51,721
6,341
45,380
3,096
48,130
9,360
38,769
11,961
24,358
2,450
75,788
5,594
70,194
15,285
51,802
6,259
45,543
3,106
31,280
21,278
6,769
3,233
469,006
205,053
4,439
200,613
193,919
6,694
125,842
66,527
41,781
31,072
7,344
3,364
470,683
205,922
4,491
201,431
194,829
6,602
125,864
66,498
37,896
26,216
8,323
3,357
467,654
204,104
3,904
200,200
193,550
6,650
125,924
66,585
34,370
23,318
8,129
2,923
469,277
204,487
3,867
200,620
193,973
6,647
126,049
66,915
34,162
23,239
7,733
3,189
465,641
203,225
3,859
199,366
192,938
6,428
125,831
67,022
37,492
26,352
7,989
3,152
468,977
204,617
4,304
200,312
193,466
6,847
125,814
67,104
37,591
27,493
7,596
2,502
465,195
202,586
4,035
198,551
191,841
6,709
125,735
66,957
36,100
26,466
7,050
2,584
465,323
201,245
3,420
197,826
191,107
6,719
126,002
66,929
37,056
26,995
7,339
2,722
463,392
200,883
3,050
197,833
191,105
6,728
126,005
67,012
7,130
7,500
10,329
15,444
8,104
2,434
6,445
14,199
4,717
7,588
456,702
10,666
137,282
838,833
7,184
7,757
10,427
15,212
7,496
2,489
6,499
15,334
4,717
7,497
458,470
10,677
142,644
860,387
7,213
7,638
10,144
15,285
7,815
2,418
6,587
13,941
4,720
7,529
455,405
10,677
140,417
847,076
7,231
7,365
10,004
15,292
8,114
2,578
6,644
14,596
4,702
7,547
457,028
10,687
139,887
850,386
7,588
6,936
9,310
15,194
7,170
2,552
6,610
14,203
4,676
7,594
453,371
10,666
136,335
841,170
7,842
7,398
9,228
15,570
8,168
2,540
6,656
14,039
4,617
7,720
456,640
10,675
140,381
855,525
7,297
7,301
9,071
15,489
7,530
2,575
6,639
14,015
4,614
7,761
452,820
10,664
138,709
844,841
7,632
7,344
8,979
15,199
7,986
2,755
6,662
14,589
4,590
7,772
452,961
10,627
135,502
845,910
7,155
7,416
9,056
15,016
7,014
2,675
6,699
14,461
4,615
7,860
450,917
10,617
131,064
832,195
161,227
518
120,804
3,842
1,898
17,164
5,547
1,062
10,394
386,236
152,264
137,356
13,788
1,020
100
233,971
202,565
17,786
430
9,504
167,522
661
125,677
4,326
1,580
18,943
5,694
900
9,741
386,132
156,382
141,313
14,003
990
77
229,749
199,543
17,154
408
9,056
163,813
632
126,247
3,850
1,256
17,617
5,760
1,015
7,434
387,236
156,880
141,640
14,181
978
81
230,355
199,649
17,333
528
9,198
165,911
681
125,439
4,383
3,449
17,913
5,319
981
7,746
384,680
156,666
141,363
14,214
1,003
85
228,014
197,904
17,247
509
8,849
158,279
615
119,853
4,283
2,921
16,100
5,528
1,050
7,928
380,896
154,478
138,970
14,468
955
85
226,418
196,593
17,307
492
8,490
167,112
694
122,190
5,348
3,164
19,059
5,714
960
9,982
380,643
156,671
140,966
14,610
1,006
89
223,972
195,147
16,756
446
8,102
159,804
579
122,507
4,076
1,958
16,323
5,726
1,015
7,620
380,470
157,551
141,607
14,868
990
86
222,919
194,140
16,949
258
8,034
161,896
649
121,184
4,170
2,513
18,391
5,456
973
8,559
379,601
158,738
142,444
15,187
1,023
84
220,863
192,261
16,787
258
8,122
154,283
553
117,282
4,151
1,432
17,205
5,582
986
7,092
380,457
159,376
142,980
15,321
991
84
221,082
193,690
16,800
262
6,960
3,686
3,589
3,648
3,507
3,536
3,521
3,538
3,434
3,369
1,158
7,114
147,288
130
3,324
167,610
3,466
155,770
544
12,229
151,739
3,145
13,209
150,223
145
10,868
160,284
543
8,622
160,312
1,215
6,539
160,190
668
1,440
157,113
80,476
783,499
55,334
79,593
804,311
56,076
80,519
790,804
56,272
79,245
794,349
56,036
79,622
785,375
55,795
80,036
799,089
56,436
78,428
788,181
56,660
79,967
789,407
56,502
81,923
775,884
56,311
1. Includes securities purchased under agreements to resell.
2. Other than financial institutions and brokers and dealers.
3. Includes federal funds purchased and securities sold under agreement to
repurchase; for information on these liabilities at banks with assets of $1 billion or
more on Dec. 31, 1977, see table 1.13.
Apr. 13
4. Not a measure of equity capital for use in capital adequacy analysis or for
other analytic uses.
A22
1.28
DomesticNonfinancialStatistics • June 1983
LARGE WEEKLY REPORTING COMMERCIAL BANKS IN NEW YORK CITY Assets and Liabilities
Millions of dollars, Wednesday figures
1983
Account
Mar. 30
1 Cash items in process of collection
2 Demand deposits due from banks in the United States..
3 All other cash and due from depository institutions . . . .
4 Total loans and securities1
5
6
7
8
9
10
11
1?
13
14
15
16
17
18
Apr. 6
Apr. 13
Apr. 20
Apr. 27p
May Ap
May IIP
May 18"
May 25p
18,952
1,064
5,884
18,548
1,101
7,476
16,742
934
5,085
17,208
1,017
4,373
15,856
902
5,628
17,214
1,257
7,298
16,302
1,020
6,167
18,229
1,245
6,518
14,489
1,212
5,880
142,175
145,475
142,749
142,886
141,999
142,754
142,088
144,466
142,980
8,860
1,413
6,935
511
9,475
1,635
7,292
548
9,467
1,628
7,278
561
9,454
1,630
7,316
508
9,399
1,684
7,211
504
9,718
1,817
7,360
541
10,485
2,368
7,574
543
10,685
2,363
7,814
508
9,555
2,248
6,799
508
13,815
1,444
11,585
1,376
10,209
786
13,746
1,465
11,501
1,301
10,200
780
13,769
1,465
11,515
1,309
10,206
790
14,078
1,464
11,802
1,568
10,234
812
14,044
1,447
11,777
1,518
10,258
821
13,916
1,458
11,630
1,466
10,164
827
14,085
1,450
11,792
1,609
10,183
843
14,151
1,528
11,805
1,562
10,244
818
14,133
1,522
11,800
1,528
10,271
811
Securities
Investment account, by maturity
One year or less
Over one through five years
Over five years
Investment account
U.S. government agencies
States and political subdivisions, by maturity
One year or less
Over one year
Other bonds, corporate stocks and securities
Loans
19 Federal funds sold3
20 To commercial banks
21 To nonbank brokers and dealers in securities
22 To others
23 Other loans, gross
24 Commercial and industrial
25
Bankers' acceptances and commercial paper
26
All other
27
U.S. addressees
28
Non-U.S. addressees
29 Real estate
30 To individuals for personal expenditures
To financial institutions
31
Commercial banks in the United States
32
Banks in foreign countries
Sales finance, personal finance companies, etc
33
34
Other financial institutions
35 To nonbank brokers and dealers in securities 4
36 To others for purchasing and carrying securities . . . .
37 To finance agricultural production
38 All other
39 LESS: Unearned income
40
Loan loss reserve
41 Other loans, net
42 Lease financing5receivables
43 All other assets
8,839
4,160
3,019
1,660
114,586
59,295
1,211
58,084
56,525
1,559
19,264
11,460
11,083
5,528
3,886
1,668
115,010
59,628
952
58,676
57,228
1,448
19,317
11,460
9,872
4,363
3,903
1,605
113,537
58,739
1,086
57,653
56,188
1,465
19,297
11,480
9,279
4,153
3,690
1,436
113,986
58,814
1,037
57,777
56,306
1,471
19,408
11,578
11,033
5,527
4,004
1,503
111,447
57,876
951
56,925
55,431
1,494
19,498
11,541
10,108
4,584
4,085
1,438
112,948
58,283
1,165
57,118
55,616
1,502
19,533
11,620
10,065
5,129
4,105
831
111,398
57,536
1,171
56,365
54,856
1,508
19,419
11,612
12,383
7,433
3,955
995
111,182
57,051
917
56,133
54,655
1,479
19,586
11,555
13,051
7,643
4,220
1,187
110,233
56,786
908
55,879
54,403
1,476
19,574
11,560
2,255
2,592
4,515
4,919
5,298
686
480
3,821
1,426
2,498
110,661
2,008
56,502
2,362
2,728
4,606
4,795
4,732
680
480
4,220
1,416
2,423
111,171
2,020
60,269
2,423
2,781
4,428
4,751
4,722
678
483
3,754
1,432
2,464
109,641
2,028
62,041
2,240
2,496
4,317
4,942
5,329
599
506
3,756
1,440
2,471
110,075
2,042
63,782
2,501
2,339
3,942
4,885
4,167
570
481
3,645
1,432
2,492
107,523
2,041
60,583
2,377
2,758
3,864
4,918
4,881
587
467
3,660
1,404
2,531
109,013
2,032
63,432
2,201
2,726
3,800
4,616
4,805
564
458
3,661
1,409
2,537
107,452
2,032
62,693
2,238
2,613
3,747
4,543
4,829
540
472
4,008
1,396
2,539
107,247
2,012
59,580
2,105
2,712
3,725
4,498
4,146
551
474
4,101
1,405
2,587
106,242
2,012
55,475
44 Total assets
226,586
234,888
229,579
231,307
227,009
233,988
230,302
232,049
222,048
49,699
179
31,807
574
555
4,640
4,238
833
6,872
74,760
25,310
23,053
1,986
199
72
49,450
40,711
2,271
81
4,877
49,709
279
32,722
747
273
5,083
4,509
680
5,416
74,811
26,457
24,198
2,007
205
47
48,354
40,048
2,213
70
4,538
47,665
294
32,692
606
381
4,496
4,544
795
3,857
74,976
26,949
24,653
2,057
186
53
48,028
39,187
2,266
303
4,711
48,766
369
33,206
710
965
4,684
4,059
765
4,008
73,852
27,094
24,707
2,132
197
58
46,758
38,232
2,283
280
4,503
46,146
312
30,726
646
915
4,139
4,322
859
4,226
72,728
27,013
24,600
2,165
189
58
45,716
37,354
2,299
230
4,355
49,174
302
30,471
1,103
854
5,485
4,432
772
5,753
72,126
27,537
25,049
2,205
220
62
44,590
36,537
2,196
230
4,184
46,818
262
31,525
727
586
4,300
4,437
816
4,165
72,063
27,899
25,360
2,265
214
60
44,164
36,383
2,201
39
4,073
48,946
311
31,857
688
630
5,529
4,200
768
4,961
72,283
28,428
25,752
2,389
228
59
43,856
35,976
2,188
39
4,233
44,860
246
30,007
680
419
4,739
4,199
794
3,775
72,471
28,705
26,032
2,411
203
58
43,766
36,836
2,220
39
3,305
1,510
1,486
1,561
1,460
1,476
1,444
1,467
1,420
1,366
1,110
3,134
52,580
32,190
2,578
58,664
32,124
400
2,184
58,191
31,137
1 120
1,707
55,750
32,773
478
51,150
33,649
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
Deposits
Demand deposits
Mutual savings banks
Individuals, partnerships, and corporations
States and political subdivisions
U.S. government
Commercial banks in the United States
Banks in foreign countries
Foreign governments and official institutions
Certified and officers' checks
Time and savings deposits
Savings
Individuals and nonprofit organizations
Partnerships and corporations operated for profit ..
Domestic governmental units
All other
Time
Individuals, partnerships, and corporations
States and political subdivisions
U.S. government
Commercial banks in the United States
Foreign governments, official institutions, and
banks
Liabilities for borrowed money
66
67 Treasury tax-and-loan notes
68 All other liabilities for borrowed money6
69 Other liabilities and subordinated notes and debentures .
70 Total liabUities
71 Residual (total assets minus total liabilities)7
1.
2.
3.
4.
Excludes trading account securities.
Not available due to confidentiality.
Includes securities purchased under agreements to resell.
Other than financial institutions and brokers and dealers.
1,994
49,541
31,783
922
58,041
32,156
971
54,351
32,270
475
3,041
53,917
32,007
207,778
215,641
210,234
212,058
207,889
214,666
210,792
212,579
202,608
18,807
19,248
19,346
19,250
19,120
19,322
19,510
19,470
19,440
5. Includes trading account securities.
6. Includes federal funds purchased and securities sold under agreements to
repurchase.
7. Not a measure of equity capital for use in capital adequacy analysis or for
other analytic uses.
Weekly Reporting Banks
1.29
LARGE WEEKLY REPORTING COMMERCIAL BANKS
A23
Balance Sheet Memoranda
Millions of dollars, Wednesday figures
1983
Account
Mar.
30
Apr.
6
Apr.
13
Apr.
20
Apr.
Hp
May
Ap
May \ \p
May 18"
May
25p
BANKS WITH ASSETS OF $750 MILLION OR MORE
1 Total loans (gross) and securities
adjusted1
1
2 Total loans (gross) adjusted
2
3 Demand deposits adjusted
633,028
502,408
103,296
638,071
504,899
105,822
636,375
502,808
106,415
639,815
504,063
104,603
634,981
499,834
102,158
640,365
503,358
103,482
635,798
499,026
104,668
635,384
498,408
101,537
633,357
497,320
4 Time deposits in accounts of $100,000 or more
5 Negotiable CDs
6 Other time deposits
154,933
106,730
48,202
151,141
103,225
47,916
151,702
103,772
47,930
149,291
101,270
48,021
147,913
99,732
48,181
145,113
97,203
47,909
144,558
96,557
48,000
142,564
94,601
47,963
143,112
95,119
47,993
3,017
2,390
626
3,036
2,412
624
3,051
2,426
625
3,047
2,427
619
2,868
2,243
624
2,790
2,172
617
2,808
2,189
619
2,808
2,189
619
2,757
10 Total loans (gross) and securities
adjusted1
1
11 Total loans (gross) adjusted
12 Demand deposits adjusted2
590,743
471,878
95,421
595,609
474,208
97,772
593,862
472,121
98,460
596,959
473,098
97,111
592,218
468,976
94,683
597,238
472,276
95,587
592,789
467,997
96,825
592,090
467,325
93,785
590,216
466,298
94,727
13 Time deposits in accounts of $100,000 or more
14 Negotiable CDs
15 Other time deposits
146,783
102,353
44,430
143,037
98,804
44,233
143,618
99,390
44,228
141,157
96,864
44,293
139,763
95,317
44,446
137,193
92,909
44,284
136,683
92,295
44,388
134,724
90,381
44,343
135,127
90,806
44,321
2,953
2,345
608
2,972
2,366
606
2,988
2,380
608
2,991
2,384
606
2,813
2,200
612
2,734
2,128
606
2,753
2,145
608
2,755
2,146
609
2,704
2,104
600
139,684
117,010
25,552
141,424
118,202
25,805
139,858
116,622
26,045
140,404
116,872
25,909
137,896
114,452
25,236
139,728
116,094
25,620
138,703
114,133
25,630
138,730
113,894
24,557
137,223
113,535
25,212
38,409
28,382
10,027
37,387
27,308
10,079
37,198
27,183
10,015
35,977
25,913
10,063
35,062
25,058
10,004
33,830
23,774
10,056
33,639
23,639
10,000
33,471
23,362
10,109
33,438
23,408
10,031
7 Loans sold outright to affiliates3
8 Commercial and industrial
9 Other
102,416
2,145
611
BANKS WITH ASSETS OF $1 BILLION OR MORE
16 Loans sold outright to affiliates3
17 Commercial and industrial
18 Other
BANKS IN NEW YORK CITY
19 Total loans (gross) and securities adjusted14
20 Total loans (gross) adjusted1
21 Demand deposits adjusted2
22 Time deposits in accounts of $100,000 or more
23 Negotiable CDs
24 Other time deposits
1. Exclusive of loans and federal funds transactions with domestic commercial
banks.
2. All demand deposits except U.S. government and domestic banks less cash
items in process of collection.
3. Loans sold are those sold outright to a bank's own foreign branches,
nonconsolidated nonbank affiliates of the bank, the bank's holding company (if
not a bank), and nonconsolidated nonbank subsidiaries of the holding company,
4. Excludes trading account securities.
A24
DomesticNonfinancialStatistics • June 1983
1.291
LARGE WEEKLY REPORTING BRANCHES AND AGENCIES OF FOREIGN BANKS
Assets and Liabilities
Millions of dollars, Wednesday figures
1983
Account
Mar. 30
Apr. 6
Apr. 13
Apr. 20
Apr. 27p
May 4p
May 11 p
May 18?
May 25p
1 Cash and due from depository institutions.
2 Total loans and securities
3 U.S. Treasury securities
4 Other securities 1
5 Federal funds sold
6 To commercial banks in United States ..
7 To others
8 Other loans, gross
9 Commercial and industrial
10
Bankers acceptances and commercial
paper
11
All other
12
U.S. addressees
13
Non-U.S. addressees
14 To financial institutions
15
Commercial banks in United States...
16
Banks in foreign countries
17
Nonbank financial institutions
18 For purchasing and carrying securities ..
19 All other
20 Other assets (claims on nonrelated
parties)
21 Net due from related institutions
22 Total assets
7,448
43,530
3,935
901
2,661
2,578
83
36,033
18,690
7,816
41,268
4,065
876
2,270
2,180
90
34,057
17,696
7,626
40,265
3,985
844
1,700
1,637
63
33,736
17,653
7,245
41,666
3,738
833
2,919
2,688
230
34,176
17,719
7,148
40,949
3,956
838
2,130
1,717
413
34,026
17,512
8,138
40,957
4,148
844
2,491
2,093
399
33,474
17,264
7,076
40,458
4,068
887
1,838
1,593
245
33,665
17,596
7,448
40,832
3,985
918
2,588
2,430
157
33,342
17,461
6,873
39,972
4,282
923
2,152
2,058
94
32,615
17,210
2,700
15,990
14,252
1,738
13,390
10,175
2,656
558
426
3,526
2,621
15,075
13,406
1,669
12,642
9,566
2,485
591
312
3.407
2,676
14,977
13,323
1,654
12,443
9,285
2,554
604
244
3,396
2,616
15,103
13,379
1,725
12,504
9,445
2,443
617
370
3,582
2,566
14,945
13,274
1,671
12,563
9,618
2,356
589
356
3,595
2,482
14,782
12,890
1,892
12,247
9,293
2,387
567
457
3,506
2,570
15,026
13,174
1,852
12,349
9,357
2,415
578
236
3,484
2,500
14,961
13,184
1,776
12,093
9,144
2,385
565
193
3,595
2,452
14,759
12,966
1,793
11,717
8,880
2,260
576
224
3,463
10,242
12,854
74,073
9,940
15,163
74,186
10,358
14,192
72,441
10,461
12,636
72,008
10,781
12,915
71,794
10,645
13,100
72,840
10,729
13,444
71,707
9,797
12,056
70,134
9,929
11,370
68,143
23 Deposits or credit balances2
24 Credit balances
25 Demand deposits
26
Individuals, partnerships, and
corporations
27
Other
28 Total time and savings
29
Individuals, partnerships, and
corporations
30
Other
31 Borrowings3
32 Federal funds purchased4
33
From commercial banks in United
States
34
From others
35 Other liabilities for borrowed money....
36
To commercial banks in United States
37
To others
38 Other liabilities to nonrelated parties
39 Net due to related institutions
40 Total liabilities
24,111
188
1,703
23,622
176
2,351
22,440
193
1,696
22,288
173
1,781
22,123
183
1,689
21,851
207
2,253
21,980
178
1,815
22,198
204
2,616
21,072
203
1,820
800
904
22,219
851
1,500
21,095
778
918
20,551
789
991
20,334
782
906
20,250
843
1,411
19,391
768
1,048
19,987
1,047
1,568
19,378
900
920
19,048
18,922
3,297
29,914
8,255
17,999
3,096
31,988
11,190
17,619
2,932
31,842
10,905
17,581
2,753
30,453
10,024
17,524
2,727
29,993
10,143
16,604
2,787
30,776
11,197
17,286
2,701
30,914
11,466
16,516
2,862
28,621
9,762
16,179
2,869
29,429
10,387
6,402
1,852
21,660
19,242
2,418
11,071
8,977
74,073
9,451
1,739
20,798
18,466
2,333
10,890
7,685
74,186
9,166
1,738
20,937
18,291
2,646
11,225
6,934
72,441
8,419
1,605
20,429
17,836
2,593
11,361
7,906
72,008
8,500
1,643
19,850
17,058
2,792
11,614
8,064
71,794
9,421
1,776
19,579
16,802
2,776
11,586
8,627
72,840
9,554
1,912
19,448
16,717
2,731
11,591
7,221
71,707
7,930
1,832
18,859
16,245
2,614
11,342
7,973
70,134
8,367
2,020
19,042
16,424
2,618
11,248
6,394
68,143
30,776
25,941
29,522
24,580
29,343
24,514
29,533
24,961
29,614
24,820
29,571
24,579
29,508
24,553
29,258
24,356
29,033
23,828
MEMO
41 Total loans (gross) and securities
adjusted'
42 Total loans (gross) adjusted5
1. Includes securities purchased under agreements to resell.
2. Balances due to other than directly related institutions.
3. Borrowings from other than directly related institutions.
1.30
4. Includes securities sold under agreements to repurchase.
5. Excludes loans and federal funds transactions with commercial banks in
United States.
LARGE WEEKLY REPORTING COMMERCIAL BANKS
ASeries discontinued.
Domestic Classified Commercial and Industrial Loans A
IPC Demand Deposits
1.31
A25
GROSS DEMAND DEPOSITS of Individuals, Partnerships, and Corporations1
Billions of dollars, estimated daily-average balances
Commercial banks
Type of holder
1978
Dec.
19792
Dec.
June3
1 All holders—Individuals, partnerships, and
corporations
294.6
302.2
315.5
2
3
4
5
6
27.8
152.7
97.4
2.7
14.1
27.1
157.7
99.2
3.1
15.1
29.8
162.3
102.4
3.3
17.2
Financial business
Nonfinancial business
Consumer
Foreign
Other
1982
1981
1980
Dec.
t|
n.a.
1
Sept.
Dec.
Mar.
June
Sept.
Dec.
277.5
288.9
268.9
271.5
276.7
295.4
28.2
148.6
82.1
3.1
15.5
28.0
154.8
86.6
2.9
16.7
27.8
138.7
84.6
3.1
14.6
28.6
141.4
83.7
2.9
15.0
31.9
142.9
83.3
2.9
15.7
35.5
151.7
88.1
3.0
17.1
Weekly reporting banks
1978
Dec.
7 All holders—Individuals, partnerships, and
corporations
8
9
10
11
12
Financial business
Nonfinancial business
Consumer
Foreign
Other
19794
Dec.
June3
147.0
139.3
147.4
19.8
79.0
38.2
2.5
7.5
20.1
74.1
34.3
3.0
7.8
21.8
78.3
35.6
3.1
8.6
1. Figures include cash items in process of collection. Estimates of gross
deposits are based on reports supplied by a sample of commercial banks. Types of
depositors in each category are described in the June 1971 BULLETIN, p. 466.
2. Beginning with the March 1979 survey, the demand deposit ownership
survey sample was reduced to 232 banks from 349 banks, and the estimation
procedure was modified slightly. To aid in comparing estimates based on the old
and new reporting sample, the following estimates in billions of dollars for
December 1978 have been constructed using the new smaller sample; financial
business, 27.0; nonfinancial business, 146.9; consumer, 98.3; foreign, 2.8; and
other, 15.1.
1981
1980
Dec.
n.a.
y
Sept.
1982
Dec.
Mar.
June
Sept.
Dec.
131.3
137.5
126.8
127.9
132.1
144.0
20.7
71.2
28.7
2.9
7.9
21.0
75.2
30.4
2.8
8.0
20.2
67.1
29.2
2.9
7.3
20.2
67.7
29.7
2.8
7.5
23.4
68.7
29.6
2.7
7.7
26.7
74.2
31.9
2.9
8.4
3. Demand deposit ownership survey estimates for June 1981 are not available
due to unresolved reporting errors.
4. After the end of 1978 the large weekly reporting bank panel was changed to
170 large commercial banks, each of which had total assets in domestic offices
exceeding $750 million as of Dec. 31, 1977. See "Announcements," p. 408 in the
May 1978 BULLETIN. Beginning in March 1979, demand deposit ownership
estimates for these large banks are constructed quarterly on the basis of 97 sample
banks and are not comparable with earlier data. The following estimates in billions
of dollars for December 1978 have been constructed for the new large-bank panel;
financial business, 18.2; nonfinancial business, 67.2; consumer, 32.8; foreign, 2.5;
other, 6.8.
A26
DomesticNonfinancialStatistics • June 1983
1.32
COMMERCIAL PAPER AND BANKERS DOLLAR ACCEPTANCES OUTSTANDING
Millions of dollars, end of period
1982
1977
Dec.
Instrument
1978
Dec.
1979'
Dec.
1980
Dec.
1981
Dec.
Nov.
1983
Dec.6'
Jan/
Feb/
Mar/
Apr.
Commercial paper (seasonally adjusted unless noted otherwise)
1 All issuers
2
3
4
5
6
Financial companies2 3
Dealer-placed paper
Total
Bank-related (not seasonally
adjusted)
Directly placed paper*
Total
Bank-related (not seasonally
adjusted)
Nonfinancial companies5
65,051
83,438
112,803
124,374
165,455
165,110
166,263
165,311
168,679
167,750
170,745
8,796
12,181
17,359
19,599
29,904
35,219
34,101
35,468
37,622
36,255
37,481
2,132
3,521
2,784
3,561
6,045
6,232
2,516
2,660
2,604
2,030
1,950
40,574
51,647
64,757
67,854
81,715
78,290
84,204
82,978
85,020
85,858
87,917
7,102
15,681
12,314
19,610
17,598
30,687
22,382
36,921
26,914
53,836
27,769
51,601
32,034
47,958
31,691
46,865
31,661
46,037
32,951
45,637
32,495
45,347
Bankers dollar acceptances (not seasonally adjusted)
7 Total
8
9
10
11
12
13
Holder
Accepting banks
Own bills
Bills bought
Federal Reserve Banks
Own account
Foreign correspondents
Others
Basis
14 Imports into United States
15 Exports from United States
16 All other
25,450
33,700
45,321
54,744
69,226
77,125
79,543
77,529
73,706
70,843
10,434
8,915
1,519
8,579
7,653
927
9,865
8,327
1,538
10,564
8,963
1,601
10,857
9,743
1,115
10,596
9,455
1,140
10,910
9,471
1,439
10,249
9,067
1,182
9,567
8,258
1,308
10,518
9,083
1,435
954
362
13,700
587
664
23,870
704
1,382
33,370
776
1,791
41,614
195
1,442
56,926
0
992
65,537
1,480
949
66,204
0
965
66,315
0
1,003
63,136
0
758
59,568
6,378
5,863
13,209
8,574
7,586
17,540
10,270
9,640
25,411
11,776
12,712
30,257
14,765
15,400
39,061
16,716
16,711
43,699
17,683
16,328
45,532
15,803
17,931
43,794
14,976
17,633
41,097
14,217
16,826
39,800
1. A change in reporting instructions results in offsetting shifts in the dealerplaced and directly placed financial company paper in October 1979.
2. Institutions engaged primarily in activities such as, but not limited to,
commercial, savings, and mortgage banking; sales, personal, and mortgage
financing; factoring, finance leasing, and other business lending; insurance
underwriting; and other investment activities.
3. Includes all financial company paper sold by dealers in the open market.
4. As reported by financial companies that place their paper directly with
investors.
1.33
5. Includes public utilities and firms engaged primarily in such activities as
communications, construction, manufacturing, mining, wholesale and retail trade,
transportation, and services.
6. Effective December 1, 1982, there was a break in the commercial paper
series. The key changes in the content of the data involved additions to the
reporting panel, the exclusion of broker or dealer placed borrowings under any
master note agreements from the reported data, and the reclassification of a large
portion of bank-related paper from dealer-placed to directly placed.
PRIME RATE CHARGED BY BANKS on Short-Term Business Loans
Percent per annum
Effective date
1981—Nov. 17
20
24
Dec. 1
1982—Feb. 18
23
July 20
29
Effective Date
16.5017.00
16.50
16.00
15.75
17.00
16.50
16.00
15.50
Aug. 2
16
18
23
7
14
Nov. 22
Oct.
1983—Jan. 11
Feb. 28
Average
rate
15.00
14.50
14.00
13.50
13.00
12.00
11.50
11.00
10.50
n.a.
1982—Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
15.75
16.56
16.50
16.50
16.50
16.50
16.26
14.39
13.50
12.52
1982—Nov
Dec
1983—Jan
Feb
Mar
May
Business Lending
All
1.34 TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, February 7-11, 1983
Size of loan (in thousands of dollars)
Item
All
sizes
50-99
25-49
1-24
100-499
500-999
and over
SHORT-TERM COMMERCIAL AND INDUSTRIAL LOANS
1
2
3
4
5
6
7
8
9
10
11
12
13
Amount of loans (thousands of dollars)
Number of loans
Weighted-average maturity (months)
With fixed rates
With floating rates
Weighted-average interest
rate (percent per annum) ..
Interquartile range1
With fixed rates
With floating rates
Percentage of amount of loans
With floating rate
Made under commitment
With no stated maturity
With one-day maturity
41,172,020
168,504
1.0
.7
2.5
10.20
9.42-10.33
10.01
10.93
1,021,295
125,222
4.1
3.9
4.6
14.44
13.12-15.48
14.73
13.76
553,106
16,919
4.2
3.2
5.8
13.57
12.68-14.37
14.09
12.97
692,787
11,148
4.8
4.5
5.5
13.40
12.47-14.37
13.79
12.84
1,803,408
9,316
4.1
2.8
5.5
12.71
11.68-13.75
13.07
12.45
797,941
1,200
3.2
1.7
4.7
11.59
10.64-12.56
10.76
12.10
36,303,484
4,698
.6
.5
1.7
9.81
9.38-9.96
9.72
10.27
20.6
57.3
7.6
46.6
29.5
32.2
12.0
.0
46.2
44.5
19.3
.1
41.0
39.2
13.7
.1
56.6
46.5
21.2
.3
61.9
66.7
30.1
6.4
16.9
58.8
6.0
52.7
1-99
LONG-TERM COMMERCIAL AND INDUSTRIAL LOANS
14
15
16
17
18
19
20
21
22
Amount of loans (thousands of dollars)
Number of loans
Weighted-average maturity (months)
With fixed rates
With floating rates
Weighted-average interest
rate (percent per annum) ..
Interquartile range1
With fixed rates
With floating rates
Percentage of amount of loans
23 With floating rate
24 Made under commitment
3,511,595
24,758
52.5
52.0
52.7
11.81
9.95-12.68
12.19
11.64
462,857
21,881
42.2
41.3
43.2
14.56
12.68-16.08
15.68
13.22
450,537
2,201
75.2
34.9
95.9
13.86
12.68-15.16
14.27
13.65
144,074
218
41.2
49.3
39.5
12.48
11.57-13.03
12.09
12.56
2,454,128
459
50.9
60.3
47.5
10.88
9.76-11.73
10.34
11.07
69.3
69.0
45.5
27.0
66.1
54.5
82.6
65.7
73.7
79.8
25
26
27
28
29
30
31
32
33
Amount of loans (thousands of dollars)
Number of loans
Weighted-average maturity (months)
With fixed rates
With floating rates
Weighted-average interest
rate (percent per annum) ..
Interquartile range1
With fixed rates
With floating rates
34
35
36
37
38
Percentage of amount of loans
With floating rate
Secured by real estate
Made under commitment
With no stated maturity
With one-day maturity
Type of construction
39 1- to 4-family
40 Multifamily
41 Nonresidential
LOANS TO FARMERS
42
43
44
45
46
Amount of loans (thousands of dollars)
Number of loans
Weighted-average maturity (months)
Weighted-average interest
rate (percent per annum) ..
Interquartile range1
47
48
49
50
51
By purpose of loan
Feeder livestock
Other livestock
Other current operating expenses
Farm machinery and equipment
Other
1,859,351
26,699
6.2
4.3
7.9
12.56
10.92-13.81
12.52
12.60
131,679
16,985
4.7
4.3
6.6
14.84
13.43-16.83
15.18
13.40
143,094
4,323
7.7
7.8
7.5
15.54
13.88-18.12
16.03
12.96
174,067
2,764
6.8
4.3
8.1
13.45
12.55-15.02
12.66
13.85
325,998
2,253
9.0
3.9
11.5
13.89
13.24-14.75
13.52
14.06
1,084,513
374
5.3
3.4
6.7
11.35
10.09-12.13
10.63
11.83
55.5
61.1
45.1
3.8
2.1
19.1
71.4
40.9
10.1
.1
15.9
32.7
26.8
1.3
.0
66.3
81.3
44.1
3.6
.0
67.5
97.9
84.4
1.6
.0
59.8
49.3
36.4
4.0
3.6
20.4
5.7
73.9
53.5
.6
45.9
26.5
1.6
71.9
41.4
2.0
56.6
36.7
4.0
59.4
7.3
8.0
84.7
25-49
50-99
100-249
1,245,489
66,458
9.6
13.85
13.10-14.75
163,829
44,427
7.9
14.44
13.52-15.03
181,268
12,094
8.9
14.48
13.96-15.00
155,502
4,528
7.1
14.21
13.65-14.93
170,728
2,701
11.2
14.05
13.62-14.49
346,388
2,349
12.7
13.99
13.52-14.65
227,774
359
6.9
12.30
11.47-13.38
13.76
14.23
14.10
14.15
13.14
14.37
14.63
14.46
13.99
14.69
14.40
14.51
14.48
14.33
14.91
14.51
14.71
13.87
14.26
14.43
13.27
(2)
14.24
(2)
14.11
14.64
(2)
14.55
(2)
12.94
12.38
(2)
12.87
(2)
10.96
All sizes
10-24
1-9
1. Interest rate range that covers the middle 50 percent of the total dollar
amount of loans made.
2. Fewer than 10 sample loans.
50-99
25-49
1-24
CONSTRUCTION AND LAND DEVELOPMENT LOANS
250 and over
NOTE. For more detail, see the Board's E.2 (111) statistical release,
A28
1.35
DomesticNonfinancialStatistics • June 1983
INTEREST RATES Money and Capital Markets
Averages, percent per annum; weekly and monthly figures are averages of business day data unless otherwise noted.
1983
Instrument
1980
1981
1983, week ending
1982
Feb.
Mar.
Apr.
May
Apr. 29
May 6
May 13
May 20
May 27
MONEY MARKET RATES
1 Federal funds1'2 3 4
Commercial paper '
2 1-month
3 3-month
4 6-month
Finance paper, directly placed3 4
5 1-month
6 3-month
7 6-month
Bankers acceptances4'5
8 3-month
9 6-month
Certificates of deposit, secondary market6
10 1-month
11 3-month
12 6-month
13 Eurodollar deposits,4 3-month2
U.S. Treasury bills 7
Secondary market
14
3-month
15
6-month
16
1-year
Auction average8
17
3-month
18
6-month
19
13.36
16.38
12.26
8.51
8.77
8.80
8.63
8.58
8.80
8.48
8.59
8.72
12.76
12.66
12.29
15.69
15.32
14.76
11.83
11.89
11.89
8.30
8.34
8.39
8.56
8.52
8.48
8.58
8.53
8.48
8.36
8.33
8.31
8.36
8.33
8.30
8.29
8.21
8.14
8.22
8.16
8.11
8.39
8.35
8.33
8.48
8.54
8.56
12.44
11.49
11.28
15.30
14.08
13.73
11.64
11.23
11.20
8.25
8.24
8.26
8.48
8.35
8.35
8.52
8.41
8.41
8.28
8.19
8.15
8.34
8.29
8.28
8.20
8.10
8.07
8.13
8.04
7.99
8.28
8.19
8.16
8.43
8.37
8.35
12.72
12.25
15.32
14.66
11.89
11.83
8.36
8.41
8.54
8.52
8.49
8.43
8.36
8.33
8.29
8.27
8.17
8.09
8.18
8.10
8.41
8.37
8.60
8.64
12.91
13.07
12.99
14.00
15.91
15.91
15.77
16.79
12.04
12.27
12.57
13.12
8.40
8.54
8.77
9.14
8.62
8.69
8.80
9.25
8.60
8.63
8.76
9.23
8.44
8.49
8.62
8.96
8.39
8.40
8.56
9.09
8.32
8.32
8.35
8.88
8.29
8.30
8.38
8.71
8.48
8.52
8.66
8.89
8.62
8.75
8.99
9.14
11.43
11.37
10.89
14.03
13.80
13.14
10.61
11.07
11.07
8.11
8.23
8.28
8.35
8.37
8.36
8.21
8.30
8.29
8.19
8.22
8.23
8.11
8.16
8.16
8.03
8.02
8.00
8.03
8.05
8.04
8.14
8.21
8.24
8.48
8.50
8.51
11.506
11.374
10.748
14.029'
13.776'
13.159
10.686
11.084
11.099
8.130
8.233
8.308
8.304
8.325
8.427
8.252
8.343
8.275
8.19
8.20
8.05
8.15
8.22
8.04
8.05
8.14
8.13
8.10
8.14
8.05
8.46
8.47
12.05
14.78
12.27
8.92
9.04
8.98
8.90
8.83
12.80
9.64
9.66
9.57
9.49
9.44
11.55
11.48
11.43
11.46
11.39
11.30
14.44
14.24
14.06
13.91
13.72
13.44
12.92
13.01
13.06
13.00
12.92
12.76
9.91
10.26
10.56
10.72
11.03
10.88
9.84
10.08
10.31
10.51
10.80
10.63
9.76
10.02
10.29
10.40
10.63
10.48
9.66
10.03
10.30
10.38
10.67
10.53
9.68
9.95
10.20
10.33
10.57
10.43
9.45
9.84
10.12
10.21
10.48
10.35
8.93
9.35
9.54
9.65
9.69
10.10
10.38
10.45
10.78
10.62
9.23
14.56
8.64
9.00
9.23
9.35
9.43
9.77
10.07
10.19
10.45
10.32
8.70
11.77
9.95
10.32
10.55
10.59
10.90
10.73
10.81
12.87
12.23
10.60
10.34
10.19
10.21
10.13
10.00
10.03
10.29
10.43
7.85
9.01
8.59
10.43
11.76
11.33
10.88
12.48
11.66
8.80
10.59
9.58
8.42
10.05
9.20
8.28
9.75
9.05
8.39
9.74
9.11
8.20
9.40
8.82
8.10
9.40
8.78
8.20
9.60
8.86
8.50
9.85
9.29
8.75
10.10
9.51
12.75
11.94
12.50
12.89
13.67
15.06
14.17
14.75
15.29
16.04
14.94
13.79
14.41
15.43
16.11
13.02
12.01
12.58
13.52
13.95
12.71
11.73
12.32
13.15
13.61
12.44
11.51
12.06
12.86
13.29
12.30
11.46
11.95
12.68
13.09
12.35
11.43
12.01
12.80
13.16
12.19
11.29
11.81
12.65
12.99
12.13
11.29
11.80
12.53
12.92
12.33
11.54
11.98
12.70
13.09
12.49
11.67
12.16
12.82
13.28
12.74
12.70
15.56
15.56
14.41
14.45
12.08
12.09
11.70
11.74
11.41
11.50
11.32
11.37
11.32
11.34
10.92
11.03
10.99
11.18
11.56
11.49
11.81
11.62
10.60
5.26
12.36
5.20
12.53
5.81
11.13
4.74
10.86
4.59
10.80
4.44
10.65
4.27
10.73
4.33
10.59
4.30
10.62
4.26
10.62
4.30
10.78
4.23
CAPITAL MARKET RATES
U.S. Treasury notes and
bonds9
Constant maturities10
20
1-vear
•>1
22
2-year
73
24
3-year
25
5-year
26
7-year
27
10-year
28
20-year
29
30-year
30
Composite13
Over 10 years (long-term)
State and local notes
and bonds
Moody's series14
Aaa
31
32
Baa
33 Bond Buyer series15
Corporate bonds 16
Seasoned issues
All industries
Aaa
Aa
A
Baa
Aaa utility bonds17
39
New issue
Recently offered issues
40
34
35
36
37
38
41
42
MEMO: Dividend/price ratio18
Preferred stocks
Common stocks
1. Weekly and monthly figures are averages of all calendar days, where the
rate for a weekend or holiday is taken to be the rate prevailing on the preceding
business day. The daily rate is the average of the rates on a given day weighted by
the volume of transactions at these rates.
2. Weekly figures are statement week averages—that is, averages for the
week ending Wednesday.
3. Unweighted average of offering rates quoted by at least five dealers (in the
case of commercial paper), or finance companies (in the case of finance paper).
Before November 1979, maturities for data shown are 30-59 days, 90—119 days,
and 120-179 days for commercial paper; and 30-59 days, 90—119 days, and 150179 days for finance paper.
4. Yields are quoted on a bank-discount basis, rather than an investment yield
basis (which would give a higher figure).
5. Dealer closing offered rates for top-rated banks. Most representative rate
(which may be, but need not be, the average of the rates quoted by the dealers).
6. Unweighted average of offered rates quoted by at least five dealers early in
the day.
7. Unweighted average of closing bid rates quoted by at least five dealers.
8. Rates are recorded in the week in which bills are issued. Beginning with the
Treasury bill auction held on Apr. 18, 1983, bidders were required to state the
percentage yield (on a bank discount basis) that they would accept to two decimal
places. Thus, average issuing rates in bill auctions will be reported using two
rather than three decimal places.
9. Yields are based on closing bid prices quoted by at least five dealers.
10. Yields adjusted to constant maturities by the U.S. Treasury. That is, yields
are read from a yield curve at fixed maturities. Based on only recently issued,
actively traded securities.
9.27
9.81
11. Each biweekly figure is the average of five business days ending on the
Monday following the date indicated. Beginning April 1,1983, this rate determines
the maximum interest payable in the following two-week period on l-'/2 year small
saver certificates. (See table 1.16.)
12. Each biweekly figure is the average of five business days ending on the
Monday following the date indicated. Until March 31, 1983, the biweekly rate
determined
the maximum interest rate payable in the following two-week period
on 2-xh year small saver certificates. (See table 1.16.)
13. Unweighted averages of yields (to maturity or call) for all outstanding notes
and bonds neither due nor callable in less than 10 years, including several very low
yielding "flower" bonds.
14. General obligations only, based on figures for Thursday, from Moody's
Investors Service.
15. General obligations only, with 20 years to maturity, issued by 20 state and
local governmental units of mixed quality. Based on figures for Thursday.
16. Daily figures from Moody's Investors Service. Based on yields to maturity
on selected long-term bonds.
17. Compilation of the Federal Reserve. Issues included are long-term (20
years or more). New-issue yields are based on quotations on date of offering;
those on recently offered issues (included only for first 4 weeks after termination
of underwriter price restrictions), on Friday close-of-business quotations.
18. Standard and Poor's corporate series. Preferred stock ratio based on a
sample often issues: four public utilities, four industrials, one financial, and one
transportation. Common stock ratios on the 500 stocks in the price index.
Securities Markets
1.36
STOCK MARKET
A29
Selected Statistics
1982
Indicator
1981
1980
1983
1982
Sept.
Oct.
Nov.
Dec.
Jan.
Mar.
Feb.
Apr.
May
Prices and trading (averages of daily figures)
Common stock prices
1 New York Stock Exchange
(Dec. 31, 1965 = 50)
2 Industrial
3 Transportation
4 Utility
5 Finance
6 Standard & Poor's Corporation (1941-43 = 10)1 . . .
7 American Stock Exchange
(Aug. 31, 1973 = 100)
68.06
78.64
60.52
37.35
64.28
118.71
74.02
85.44
72.61
38.90
73.52
128.05
68.93
78.18
60.41
39.75
71.99
119.71
70.21
80.08
61.39
40.36
69.66
122.43
76.10
86.67
66.64
42.67
80.59
132.66
79.75
90.76
71.92
43.46
88.66
138.10
80.30
92.00
73.40
42.93
86.22
139.37
83.25
95.37
75.65
45.59
85.66
145.13
84.74
97.26
79.44
45.92
86.57
146.80
87.50
100.61
83.28
45.89
93.22
151.88
90.61
104.46
85.26
46.22
99.07
157.71
94.61
109.43
89.07
47.62
102.45
164.10
300.94
343.58
282.62
286.22
308.74
333.54
333.36
360.92
373.84
383.76
405.02
447.94
Volume of trading
(thousands of shares)
8 New York Stock Exchange
9 American Stock Exchange
44,867
6,377
46,967
5,346
64,617
5,283
73,710
5,064
98,508
7,828
88,431
8,672
76,463
7,475
88,463
9,220
85,026
8,256
82,694
7,354
89,627
8,576
93,016
12,260
Customer financing (end-of-period balances, in millions of dollars)
10 Regulated margin credit
at
brokers-dealers2
14,721
14,411
13,325
11,208
11,728
12,459
13,325
13,370
13,985
14,483
15,590
11 Margin stock3
12 Convertible bonds
13 Subscription issues
14,500
219
2
14,150
259
2
12,980
344
1
10,950
257
1
11,450
277
1
12,170
288
1
12,980
344
1
13,070
299
1
13,680
304
1
14,170
312
1
15,260
329
1
2,105
6,070
3,515
7,150
5,735
8,390
4,990
7,475
5,520
8,120
5,600
8,395
5,735
8,390
6,257
8,225
6,195
7,955
6,370
7,965'
6,090
7,970
Free credit balances at brokers4
14 Margin-account
15 Cash-account
n a.
Margin-account debt at brokers (percentage distribution, end of period)
16 Total
17
18
19
20
21
22
By equity class (in percent)5
Under 40
40-49
50-59
60-69
70-79
80 or more
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
14.0
30.0
25.0
14.0
9.0
8.0
37.0
24.0
17.0
10.0
6.0
6.0
21.0
24.0
24.0
14.0
9.0
8.0
27.0
26.0
20.0
12.0
8.0
7.0
21.0
24.0
22.0
16.0
9.0
8.0
20.0
21.0
25.0
15.0
10.0
9.0
21.0
24.0
24.0
14.0
9.0
8.0
18.0
23.0
25.0
16.0
9.0
9.0
18.0
20.0
27.0
16.0
10.0
9.0
17.0
21.0
25.0
18.0
10.0
9.0
14.0
19.0
28.0
19.0
10.0
9.0
n.a.
1
I
1
Special miscellaneous-account balances at brokers (end of period)
6
23 Total balances (millions of dollars)
Distribution by equity status
(percent)
24 Net credit status
Debt status, equity of
25 60 percent or more
26 Less than 60 percent
21,690
25,870
35,598
31,644
33,689
34,909
35,598
43,838
43,006
43,472
44,999
47.8
58.0
62.0
61.0
61.0
62.0
62.0
65.0
66.0
62.0
64.0
44.4
7.7
31.0
11.0
29.0
9.0
27.0
12.0
29.0
10.0
29.0
9.0
29.0
9.0
28.0
8.0
27.0
7.0
28.0
9.0
30.0
6.0
n.a.
1
\
Margin requirements (percent of market value and effective date)7
27 Margin stocks
28 Convertible bonds
29 Short sales
Mar. 11, 1968
June 8, 1968
May 6, 1970
Dec. 6, 1971
Nov. 24, 1972
Jan. 3, 1974
70
50
70
80
60
80
65
50
65
55
50
55
65
50
65
50
50
50
1. Effective July 1976, includes a new financial group, banks and insurance
companies. With this change the index includes 400 industrial stocks (formerly
425), 20 transportation (formerly 15 rail), 40 public utility (formerly 60), and 40
financial.
2. Margin credit includes all credit extended to purchase or carry stocks or
related equity instruments and secured at least in part by stock. Credit extended is
end-of-month data for member firms of the New York Stock Exhange.
In addition to assigning a current loan value to margin stock generally,
Regulations T and U permit special loan values for convertible bonds and stock
acquired through exercise of subscription rights.
3. A distribution of this total by equity class is shown on lines 17-22.
4. Free credit balances are in accounts with no unfulfilled commitments to the
brokers and are subject to withdrawal by customers on demand.
5. Each customer's equity in his collateral (market value of collateral less net
debit balance) is expressed as a percentage of current collateral values.
6. Balances that may be used by customers as the margin deposit required for
additional purchases. Balances may arise as transfers based on loan values of
other collateral in the customer's margin account or deposits of cash (usually sales
proceeds) occur.
7. Regulations G, T, and U of the Federal Reserve Board of Governors,
prescribed in accordance with the Securities Exchange Act of 1934, limit the
amount of credit to purchase and carry margin stocks that may be extended on
securities as collateral by prescribing a maximum loan value, which is a specified
percentage of the market value of the collateral at the time the credit is extended.
Margin requirements are the difference between the market value (100 percent)
and the maximum loan value. The term "margin stocks" is defined in the
corresponding regulation.
A30
1.37
DomesticNonfinancialStatistics • June 1983
SELECTED FINANCIAL INSTITUTIONS
Selected Assets and Liabilities
Millions of dollars, end of period
1982
Account
1980
1983
1981
July
Aug.
Oct.
Sept.
Nov.
Dec/
Jan/
Feb/
Mar.
Apr.P
Savings and loan associations
1 Assets
2 Mortgages
Cash and investment securities'
4 Other
630,712 664,167 697,690 703,399 691,077 692,549 697,189 706,045 714,676 772,352 723,616 728,680
503,192 518,547 510,678 509,776 493,899 489,923 488,614 482,234 481,470 481,090 475, 688 476,526
57,928 63,123 72,854 74,141 74,692 75,638 78,122 84,767 90,662 94,080 96,649 99 089
69,592 82,497 114,158 119,482 122,486 126,988 130,453 139,044 142,544 147,182 151,279 153,065
5 Liabilities and net worth
630,712 664,167
697,690 703,399 691,077
511,636 525,061
64,586 88,782
47,045 62,794
17,541 25,988
8,767
6,385
15,544
12,394
539,830 542,648 547,628 547,112 548,439 566,189
98,433 98,803 99,771 100,881 102,948 97,979
67,019 66,374 65,567 65,015 64,202 63,861
31,414 32,429 34,204 35,866 38,746 34,118
8,484
8,967
9,934
8,084
7,250
7,491
15,720
27,375 29,965
19,202 20,018 21,048
6
7
8
9
10
11
Savings capital
Borrowed money
FHLBB
Other
Loans in process
Other
2
12 Net worth
MEMO: Mortgage
loan commitments
outstanding3
N
692,549 697,189 706,045
33,329
28,395
24,802
24,492
24,476
24,538
24,754
16,102
15,225
15,924
16,943
17,256
18,407
19,682
714,676
772,352
723,616
728,680
582,918 591,913
88,925 86,544
60,415 58,841
28,510 27,703
10,453
11,039
16,658
17,524
597,112
84,884
56,859
28,025
12,245
14,767
601,325
83,559
55,874
27,685
13,493
16,373
26,157
26,175
26,371
26,853
27,429
18,054
19,453
22,051
24,885
24,895
4
Mutual savings banks
171,564
175,728
175,683
172,901
173,487
172,908
172,287
174,197
174,726
176,378
178,814
99,865
11,733
99,997
14,753
96,282
17,128
94,498
16,929
94,382
17,458
94,261
17,035
94,017
16,702
94,091
16,957
93,944
17,420
93,607
18,211
93,822
17,837
8,949
2,390
39,282
4,334
5,011
9,810
2,288
37,791
5,442
5,649
10,058
2,236
36,651
6,225
7,104
9,675
2,201
35,937
6,460
7,192
9,404
2,191
35,845
6,695
7,514
9,219
2,505
35,599
6,749
7,540
9,456
2,496
35,753
6,291
7,572
9,743
2,470
36,161
6,919
7,855
10,248
2,446
36,430
6,275
7,963
11,081
2,440
36,905
6,104
8,031
12,187
2,403
37,827
6,548
8,189
22 Liabilities
171,564
175,728
175,683
172,901
173,487
172,908
172,287
174,197
174,726
176,378
178,814
n Deposits
?4 Regular7
75
Ordinary savings
76
Time
27 Other
28 Other liabilities
29 General reserve accounts
30 MEMO: Mortgage loan commitments
outstanding®
154,805
151,416
53,971
97,445
2,086
6,695
11,368
155,110
153,003
49,425
103,578
2,108
10,632
9,986
154,314
151,969
47,580
116,998
2,345
11,926
9,443
152,014
149,736
46,901
116,213
2,278
11,671
9,216
153,089
150,795
47,496
103,299
2,294
11,166
9,232
152,210
149,928
48,520
101,408
2,283
11,556
9,141
151,304
149,167
49,208
99,959
2,137
11,893
9,089
155,196
152,777
46,862
110,462
2,419
8,336
9,235
157,113
154,876
41,850
103,658
2,237
7,722
9,196
159,162
156,915
41,165
100,851
2,247
7,542
9,197
161,489
159 088
41,183
99,687
2,401
7,395
9,342
1,476
1,293
992
1,056
1,217
1,281
1,400
1,285
1,253
1,295
1,639
14 Assets
15
16
17
18
19
70
21
Loans
Mortgage
Other
Securities
U.S. government5
State and local government
Corporate and other6
Cash
Other assets
n.a.
Life insurance companies
31 Assets
3?
33
34
35
36
37
38
39
40
41
42
Securities
Government 9
United States
State and
local
Foreign10
Business
Bonds
Stocks
Mortgages
Real estate
Policy loans
Other assets
578,200 584,311
589,490 595,959
21,378 25,209 28,694 30,263 30,759 31,791 32,682 34,558
10,774
12,214
12,606 13,538
14,370
16,072
5,345
8,167
7,871
7,935
8,094
7,834
7,705
7,799
7,151
6,701
10,382
10,377
10,392
10,215
10,250
10,319
9,332
9,891
238,113 255,769 267,627 270,029 273,539 279,918 283,650 283,799
190,747 208,098 221,503 221,642 223,783 226,879 229,101 228,220
47,366 47,670 46,124 48,387 49,756 53,039 54,549 55,579
131,030 137,747 140,044 140,244 140,404 140,678 140,956 141,919
15,063
18,278 20,198 20,176 20,268 20,293 20,480 21,019
41,411 48,706 51,867 52,238 . 52,525 52,751 52,916 53,114
31,702 40,094 42,694 44,144 45,826 46,471 47,516 49,902
35,567 36,946
16,731
17,877
8,225
8,333
10,611
10,736
290,178 293,427
233,380 235,376
56,798 58,051
142,277 142,683
20,922 21,014
53,239 53,383
47,307 48,506
479,210 525,803
551,124 557,094 563,321
571,902
n a.
n.a.
Credit unions"
43 Total assets/liabilities and capital
44 Federal
45 State
71,709
39,801
31,908
77,682
42,382
35,300
84,423
45,931
38,492
85,102
46,310
38,792
86,554
47,076
39,478
88,144
47,649
40,495
89,261
48,272
40,989
69,673
45,483
24,190
69,741
45,418
23,323
71,293
46,449
24,844
73,737
48,057
25,680
46 Loans outstanding
47 Federal
48 State
49 Savings
50 Federal (shares)
51 State (shares and deposits)
47,774
25,627
22,147
64,399
36,348
28,051
50,448
27,458
22,990
68,871
37,574
31,297
50,133
27,351
22,782
75,088
40,969
34,119
50,733
27,659
23,074
75,331
41,178
34,153
51,047
27,862
23,185
76,874
41,961
34,913
50,934
27,789
23,145
78,529
42,852
35,677
50,936
27,824
23,139
79,799
43,413
36,386
43,577
28,184
15,393
63,071
41,341
21,730
43,293
27,966
15,328
63,321
41,441
21,880
43,135
27,832
15,303
64,684
42,404
22,280
43,433
27,974
15,459
67,266
43,890
23,376
For notes see bottom of opposite page.
n .a.
Federal Finance
1.38
A31
FEDERAL FISCAL AND FINANCING OPERATIONS
Millions of dollars
Calendar year
Type of account or operation
U.S. budget
1 Receipts1
2 Outlays12
3 Surplus, or deficit ( - )
4 Trust funds
5 Federal funds
Fiscal
year
1980
Fiscal
year
1981
Fiscal
year
1982
1982
1981
H2
HI
1983
H2
Feb.
Mar.
Apr.
517,112
576,675
-59,563
8,801
-68,364
599,272
657,204
-57,932
6,817
-64,749
617,766
728,375
-110,609
5,456
-116,065
301,777
358,558
-56,780
-8,085
-48,697
322,478
348,678
-26,200
-17,690
-43,889
286,338
390,846
-104,508
-6,576
-97,934
38,816
64,152
-25,336
-4,830
-20,506
43,504
69,540
-26,036
2,085
-28,120
66,234
69,542
-3,308
403
-3,711
-14,549
303
-20,769
-236
-14,142
-3,190
-8,728
-1,752
-7,942
227
-4,923
-2,267
-52
47
-1,244
-16
-1,290
151
-73,808
-78,936
-127,940
-67,260
-33,914
-111,699
-25,341
-27,296
-4,447
70,515
79,329
134,993
54,081
41,728
119,609
17,919
31,303
2,681
-355
3,648
-1,878
1,485
-11,911
4,858
-1,111
14,290
-408
-7,405
-9,057
1,146
7,496
-74
-6,767
2,761
-8,156
9,922
20,990
4,102
16,888
18,670
3,520
15,150
29,164
10,975
18,189
12,046
4,301
7,745
10,999
4,099
6,900
19,773
5,033
14,740
10,006
2,856
7,150
15,452
3,572
11,880
24,053
6,015
18,038
Off-budget entities (surplus, or deficit
(-))
6 Federal Financing Bank outlays
7 Other
U.S. budget plus off-budget, including
Federal Financing Bank
8 Surplus, or deficit ( - )
Source or financing
9 Borrowing from the public
10 Cash and monetary
assets (decrease, or
increase (-)) 5
11 Other6
MEMO:
12 Treasury operating balance (level, end of
period)
13 Federal Reserve Banks
14 Tax and loan accounts
1. Effective Feb. 8, 1982, supplemental medical insurance premiums and
voluntary hospital insurance premiums, previously included in other insurance
receipts, have been reclassified as offsetting receipts in the health function.
2. Effective Oct. 1, 1980, the Pension Benefit Guaranty Corporation was
reclassified from an off-budget agency to an on-budget agency in the Department
of Labor.
3. Half-year figures are calculated as a residual (total surplus/deficit less trust
fund surplus/deficit).
4. Other off-budget includes Postal Service Fund; Rural Electrification and
Telephone Revolving Fund; and Rural Telephone Bank; it also includes petroleum
acquisition and transportation and strategic petroleum reserve effective November 1981.
NOTES TO TABLE 1.37
1. Holdings of stock of the Federal Home Loan Banks are included in "other
assets."
2. Includes net undistributed income, which is accrued by most, but not all,
associations.
3. Excludes figures for loans in process, which are shown as a liability.
4. The NAMSB reports that, effective April 1979, balance sheet data are not
strictly comparable with previous months. Beginning April 1979, data are reported
on a net-of-valuation-reserves basis. Before that date, data were reported on a
gross-of-valuation-reserves basis.
5. Beginning April 1979, includes obligations of U.S. government agencies.
Before that date, this item was included in "Corporate and other."
6. Includes securities of foreign governments and international organizations
and, before April 1979, nonguaranteed issues of U.S. government agencies.
7. Excludes checking, club, and school accounts.
8. Commitments outstanding (including loans in process) of banks in New York
State as reported to the Savings Banks Association of the state of New York.
9. Direct and guaranteed obligations. Excludes federal agency issues not
guaranteed, which are shown in the table under "Business" securities.
5. Includes U.S. Treasury operating cash accounts; special drawing rights; gold
tranche drawing rights; loans to International Monetary Fund; and other cash and
monetary assets.
6. Includes accrued interest payable to the public; allocations of special
drawing rights; deposit funds; miscellaneous liability (including checks outstanding) and asset accounts; seigniorage; increment on gold; net gain/loss for U.S.
currency valuation adjustment; net gain/loss for IMF valuation adjustment; and
profit on the sale of gold.
SOURCE. "Monthly Treasury Statement of Receipts and Outlays of the U.S.
Government." Treasury Bulletin, and the Budget of the United States Government, Fiscal Year 1984.
10. Issues of foreign governments and their subdivisions and bonds of the
International Bank for Reconstruction and Development.
11. As of December 1982, National Credit Union Administration data no longer
includes either federally chartered or state chartered corporate credit unions.
NOTE. Savings and loan associations: Estimates by the FHLBB for all
associations in the United States. Data are based on monthly reports of federally
insured associations and annual reports of other associations. Even when revised,
data for current and preceding year are subject to further revision.
Mutual savings banks: Estimates of National Association of Mutual Savings
Banks for all savings banks in the United States.
Life insurance companies: Estimates of the American Council of Life Insurance
for all life insurance companies in the United States. Annual figures are annualstatement asset values, with bonds carried on an amortized basis and stocks at
year-end market value. Adjustments for interest due and accrued and for
differences between market and book values are not made on each item separately
but are included, in total, in "other assets."
Credit unions: Estimates by the National Credit Union Administration for a
group of federal and state-chartered credit unions that account for about 30
percent of credit union assets. Figures are preliminary and revised annually to
incorporate recent benchmark data.
A32
1.39
DomesticNonfinancialStatistics • June 1983
U.S. BUDGET RECEIPTS AND OUTLAYS
Millions of dollars
Calendar year
Source or type
Fiscal
year
1980
Fiscal
year
1981
Fiscal
year
1982
1981
1982
1983
H2
HI
H2
Feb.
Mar.
Apr.
RECEIPTS
1 All sources'
2 Individual income taxes, net
3 Withheld
4 Presidential Election Campaign Fund . . .
5 Nonwithheld
6 Refunds
Corporation income taxes
7 Gross receipts
8 Refunds
9 Social insurance taxes and contributions,
net
10 Payroll employment
taxes and
contributions2
11 Self-employment 3taxes and
contributions
12 Unemployment insurance
13 Other net receipts14
517,112
599,272
617,766
301,777
322,478
286,338
38,816
43,504
66,234
244,069
223,763
39
63,746
43,479
285,917
256,332
41
76,844
47,299
297,744
267,513
39
84,691
54,498
147,035
134,199
5
17,391
4,559
150,565
133,575
34
66,174
49,217
145,676
131,567
5
20,040
5,938
20,544
22,288
4
1,970
3,717
15,658
24,808
9
3,604
12,764
35,040
21,636
8
31,961
18,564
72,380
7,780
73,733
12,596
65,991
16,784
31,056
6,847
37,836
8,028
25,661
11,467
2,115
2,388
6,985
2,612
8,445
3,650
157,803
182,720
201,498
91,592
108,079
94,278
13,797
17,939
21,481
133,025
156,932
172,744
82,984
88,795
85,063
11,845
16,975
14,567
5,723
15,336
3,719
6,041
15,763
3,984
7,941
16,600
4,212
244
6,355
2,009
7,357
9,809
2,119
177
6,857
2,181
43
1,553
356
418
160
387
4,232
2,324
358
24,329
7,174
6,389
12,748
40,839
8,083
6,787
13,790
36,311
8,854
7,991
16,161
22,097
4,661
3,742
8,441
17,525
4,310
4,208
7,984
16,556
4,299
3,445
7,891
2,795
503
349
1,101
2,755
733
500
1,545
2,557
762
458
1,141
16
18 All types '
576,675
657,204
728,424
358,532
348,683
390,847
64,152
69,540
69,542
19
20
21
22
23
24
National defense
International affairs
General science, space, and technology . . .
Energy
Natural resources and environment
Agriculture
135,856
10,733
5,722
6,313
13,812
4,762
159,765
11,130
6,359
10,277
13,525
5,572
187,418
9,982
7,070
4,674
12,934
14,875
87,421
4,646
3,388
4,394
7,296
5,181
93,154
5,183
3,370
2,946
5,636
7,087
100,419
4,406
3,903
2,059
6,940
13,260
16,567
108
610
330
998
2,170
19,038
1,601
526
488
913
1,003
17,524
937
607
212
1,036
2,717
Commerce and housing credit
Transportation
Community and regional development . . . .
Education, training, employment, social
services
79 Health1
30 Income security6
7,788
21,120
10,068
3,946
23,381
9,394
3,865
20,560
7,165
1,825
10,753
4,269
1,408
9,915
3,055
2,244
10,686
4,186
-559
1,557
405
395
1,776
562
434
1,581
427
30,767
55,220
193,100
31,402
65,982
225,101
26,300
74,017
248,343
13,874
35,322
129,269
12,607
37,219
112,782
12,187
39,073
133,779
2,159
6.575
22,812
2,114
6,913
24,840
1,985
7,120
24,654
21,183
4,570
4,505
8,584
52,458
-9,887
22,988
4,696
4,614
6,856
68,726
-16,509
23,955
4,671
4,726
6,393
84,697
-13,270
12,880
2,290
2,320
3,043
39,952
-9,564
10,865
2,334
2,400
3,325
41,883
-6,490
13,241
2,373
2,322
3,152
44,948
-8,333
2,063
412
345
89
8,416
-905
2,292
473
427
40
6,854
-715
3,357
432
163
1,162
6,343
-1,148
14
15
16
17
Excise taxes
Customs deposits
Estate and gift taxes
Miscellaneous receipts5
OUTLAYS
25
26
27
28
31
32
33
34
35
36
Veterans benefits and services
Administration of justice
General government
General-purpose fiscal assistance
Net Interest'
Undistributed offsetting receipts8
1. Effective Feb. 8, 1982, supplemental medical insurance premiums and
voluntary hospital insurance premiums, previously included in other insurance
receipts, have been reclassified as offsetting receipts in the health function.
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. Effective Oct. 1, 1980, the Pension Benefit Guaranty Corporation was
reclassified from an off-budget agency to an on-budget agency in the Department
of Labor.
7. Net interest function includes interest received by trust funds.
8. Consists of rents and royalties on the outer continental shelf and U.S.
government contributions for employee retirement.
SOURCE. "Monthly Treasury Statement of Receipts and Outlays of the U.S.
Government" and the Budget of the U.S. Government, Fiscal Year 1984.
Federal Finance
1.40
A33
FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION
Billions of dollars
1982
1981
1983
Item
Mar. 31
June 30
Sept. 30
Dec. 31
Mar. 31
June 30
Sept. 30
Dec. 31
Mar. 31
1 Federal debt outstanding
970.9
977.4
1,003.9
1,034.7
1,066.4
1,084.7
1,147.0
1,201.9
1,249.3
2 Public debt securities
3 Held by public
4 Held by agencies
964.5
773.7
190.9
971.2
771.3
199.9
997.9
789.8
208.1
1,028.7
825.5
203.2
1,061.3
858.9
202.4
1,079.6
867.9
211.7
1,142.0
925.6
216.4
1,197.1
987.7
209.4
1,244.5
1,043.3
201.2
6.4
4.9
1.5
6.2
4.7
1.5
6.1
4.6
1.5
6.0
4.6
1.4
5.1
3.9
1.2
5.0
3.9
1.1
5.0
3.7
1.3
4.8
3.7
1.1
4.8
3.7
1.1
5 Agency securities
6 Held by public
7 Held by agencies
8 Debt subject to statutory limit
965.5
972.2
998.8
1,029.7
1,062.2
1,080.5
1,142.9
1,197.9
1,245.3
9 Public debt securities
10 Other debt1
963.9
1.6
970.6
1.6
997.2
1.6
1,028.1
1.6
1,060.7
1.5
1,079.0
1.5
1,141.4
1.5
1,196.5
1.4
1,243.9
1.4
11 MEMO: Statutory debt limit
985.0
985.0
999.8
1,079.8
1,079.8
1,143.1
1,143.1
1,290.2
1,290.2
1. Includes guaranteed debt of government agencies, specified participation
certificates, notes to international lending organizations, and District of Columbia
stadium bonds.
1.41
GROSS PUBLIC DEBT OF U.S. TREASURY
NOTE. Data from Treasury Bulletin (U.S. Treasury Department),
Types and Ownership
Billions of dollars, end of period
1983
Type and holder
1979
1981
1980
1982
Jan.
1 Total gross public debt
2
3
4
5
6
7
8
9
10
11
12
13
14
By type
Interest-bearing debt
Marketable
Bills
Notes
Bonds
Nonmarketable1
State and local government series
Foreign issues3
Government
Public
Savings bonds and notes 4
Government account series
15 Non-interest-bearing debt
Feb.
Mar.
May
Apr.
845.1
930.2
1,028.7
1,197.1
1,201.0
1,215.3
1,244.5
1,247.9
1,291.4
844.0
530.7
172.6
283.4
74.7
313.2
2.2
24.6
28.8
23.6
5.3
79.9
177.5
928.9
623.2
216.1
321.6
85.4
305.7
1,027.3
720.3
245.0
375.3
99.9
307.0
1,195.5
881.5
311.8
465.0
104.6
314.0
1,199.6
8£ 8.7
308.1
473.0
107.6
310.9
1,213.7
907.7
314.9
481.3
111.5
306.1
1,243.0
937.8
331.9
494.1
111.4
305.2
1,242.1
935.5
325.9
494.9
14.6
306.6
1,289.9
957.4
325.2
513.6
118.5
332.6
23.8
24.0
17.6
6.4
72.5
185.1
23.0
19.0
14.9
4.1
68.1
196.7
25.7
14.7
13.0
1.7
68.0
205.4
25.6
14.0
12.7
1.3
8.1
203.0
25.7
12.7
11.4
1.3
68.3
199.1
27.1
12.4
11.1
1.3
68.5
197.0
28.0
12.0
10.7
1.3
68.8
197.6
29.6
1.1
10.5
0.6
69.2
222.4
1.2
1.3
1.4
1.6
1.4
1.6
1.5
5.9
1.5
187.1
117.5
540.5
96.4
4.7
16.7
22.9
69.9
192.5
121.3
616.4
116.0
5.4
20.1
25.7
78.8
203.3
131.0
694.5
109.4
5.2
19.1
37.8
85.6
209.4
139.3
848.4'
131.4
n.a.
38.7'
n.a.
113.4'
207.0
132.4
203.3
135.6
n a.
l.a.
201.2
136.7
906.6
153.2
n.a.
40.0
n.a.
n.a.
79.9
36.2
124.4
90.1
72.5
56.7
127.7
106.9
68.0
75.6
141.4
152.3
68.3
48.2'
149.4'
233.2'
5
By holder
16 U.S. government agencies and trust funds
17 Federal Reserve Banks
18 Private investors
19 Commercial banks
20 Mutual savings banks
21 Insurance companies
22 Other companies
23 State and local governments
24
25
26
27
Individuals
Savings bonds
Other securities
Foreign and international6
Other miscellaneous investors7
1. Includes (not shown separately): Securities issued to the Rural Electrification Administration, depository bonds, retirement plan bonds, and individual
retirement bonds.
2. These nonmarketable bonds, also known as Investment Series B Bonds,
may be exchanged (or converted) at the owner's option for l'/2 percent, 5-year
marketable Treasury notes. Convertible bonds that have been so exchanged are
removed from this category and recorded in the notes category (line 5).
3. Nonmarketable dollar-denominated and foreign currency-denominated series held by foreigners.
4. Held almost entirely by U.S. government agencies and trust funds.
n.a.
n.a.
68.3
48.4
156.3
n.a.
5. Data for Federal Reserve Banks and U.S. government agencies and trust
funds are actual holdings; data for other groups are Treasury estimates.
6. Consists of investments of foreign balances and international accounts in the
United States.
7. Includes savings and loan associations, nonprofit institutions, corporate
pension trust funds, dealers and brokers, certain government deposit accounts,
and government sponsored agencies.
NOTE. Gross public debt excludes guaranteed agency securities.
Data by type of security from Monthly Statement of the Public Debt of the
United States (U.S. Treasury Department); data by holder from Treasury
Bulletin.
A34
1.42
DomesticNonfinancialStatistics • June 1983
U.S. GOVERNMENT SECURITIES DEALERS
Transactions
Par value; averages of daily figures, in millions of dollars
1983
Item
1980
1981
1983, week ending Wednesday
1982
Mar/
Feb/
Apr.
Apr. 2(K Apr. 27'
May 4
May 11
May 18
May 25
1
Immediate delivery1
U.S. government securities
18,331
24,728
32,271
40,570
37,900
38,468
39,723
39,170
42,728
48,263
40,399
35,028
2
3
4
5
6
By maturity
Bills
Other within 1 year
1-5 years
5-10 years
Over 10 years
11,413
421
3,330
1,464
1,704
14,768
621
4,360
2,451
2,528
18,398
810
6,272
3,557
3,234
20,327
706
9,245
5,251
5,042
20,195
519
7,884
5,196
4,106
22,142
611
7,385
4,136
4,194
22,299
673
7,022
4,869
4,860
20,760
580
10,217
3,774
3,839
20,844
651
10,604
5,139
5,490
24,792
545
8,108
5,771
9,047
21,643
659
8,190
4,627
5,281
19,098
493
7,576
3,434
4,428
By type of customer
U.S. government securities
dealers
U.S. government securities
8
brokers
9
All others2
10 Federal agency securities
11 Certificates of deposit
12 Bankers acceptances
13 Commercial paper3
Futures transactions
14 Treasury bills
15 Treasury coupons
16 Federal agency securities
Forward transactions4
17 U.S. government securities
18 Federal agency securities
7
1,484
1,640
1,769
1,904
1,757
2,418
1,842
2,122
2,786
2,748
2,163
1,852
7,610
9,237
3,258
2,472
i
t
11,750
11,337
3,306
4,477
1,807
6,128
15,659
15,344
4,142
5,001
2,502
7,595
20,005
18,662
4,982
4,402
2,593
7,806
18,414
17,728
4,575
3,702
2,255
7,604
18,535
17,515
5,584
4,541
3,063
8,603
19,924
17,957
5,800
4,329
3,313
8,736
19,151
17,897
6,202
4,798
3,063
8,603
21,220
18,722
5,749
4,493
3,097
8,551
24,969
20,546
5,689
3,895
2,917
7,772
20,171
18,065
5,969
3,672
2,381
8,269
17,678
15,499
5,641
3,326
1,897
7,882
I
1
3,523
1,330
234
5,031
1,490
259
6,303
2,055
236
6,040
2,138
262
6,057
1,779
194
6,192
2,085
193
6,144
1,890
241
5,895
2,068
198
6,092
2,314
288
7,116
2,523
194
6,217
2,342
361
365
1,370
835
982
1,707
1,175
1,628
1,439
1,322
1,493
1,212
1,770
1,189
1,131
2,222
1,431
2,361
2,037
1,328
1,726
743
1,166
n.a.
|T
from the date of the transaction for government securities (Treasury bills, notes,
and bonds) or after 30 days for mortgage-backed agency issues.
NOTE. Averages for transactions are based on number of trading days in the
period.
Transactions are market purchases and sales of U.S. government securities
dealers reporting to the Federal Reserve Bank of New York. The figures exclude
allotments of, and exchanges for, new U.S. government securities, redemptions
of called or matured securities, purchases or sales of securities under repurchase
agreement, reverse repurchase (resale), or similar contracts.
1. Before 1981, data for immediate transactions include forward transactions.
2. Includes, among others, all other dealers and brokers in commodities and
securities, nondealer departments of commercial banks, foreign banking agencies,
and the Federal Reserve System.
3. Futures contracts are standardized agreements arranged on an organized
exchange in which parties commit to purchase or sell securities for delivery at a
future date.
4. Forward transactions are agreements arranged in the over-the-counter
market in which securities are purchased (sold) for delivery after 5 business days
1.43
U.S. GOVERNMENT SECURITIES DEALERS
Positions and Financing
Averages of daily figures, in millions of dollars
1983
Item
1980
1981
1983, week ending Wednesday
1982
Feb/
Mar/
Apr.
Apr. 13
Apr. 20
Apr. 27
May 4
May 11
Positions
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Net immediate1
U.S. government securities
Bills
Other within 1 year
1-5 years
5-10 years
Over 10 years
Federal agency securities..
Certificates of deposit
Bankers acceptances
Commercial paper
Futures positions
Treasury bills
Treasury coupons
Federal agency securities..
Forward positions
U.S. government securities
Federal agency securities..
4,306
4,103
-1,062
434
166
665
797
3,115
n.a.
9,033
6,485
-1,526
1,488
292
2,294
2,277
3,435
1,746
2,658
9,328
4,837
-199
2,932
-341
2,001
3,712
5,531
2,832
3,317
14,192
10,534
-428
2,719
-203
1,570
4,455
5,683
2,901
2,892
11,399
9,544
3
1,263
-748
1,337
4,855
6,104
2,809
3,173
9,014
7,775
-371
733
-57
934
5,278
5,474
3,051
3,228
6,924
6,650
-491
-53
-270
1,087
5,022
5,307
2,740
3,345
10,271
9,412
-404
-131
304
1,089
5,659
5,492
3,177
3,204
10,698
8,119
-298
2,336
-53
593
5,221
5,401
3,275
2,943
11,748
8,345
-118
2,537
158
827
5,647
5,761
4,254
3,950
11,813
6,886
97
2,560
209
2,062
5,581
5,103
3,834
3,575
-8,934
-2,733
522
-2,508
-2,361
-224
-3,217
-1,206
-137
-530
-1,907
-64
-7,151
-1,966
112
-6,649
-2,136
79
-8,613
-2,025
227
-7,851
-1,593
177
-9,644
-2,059
79
-10,259
-2,214
51
-603
-451
-788
-1,190
-1,061,
-1,962!
-1,782
-1,906
-887
-1,570
-1,002
-1,747
-1,312
-1,853
-664
-1,200
-563
-1,091
-863
-1,573
Financing2
Reverse repurchase agreements3
Overnight and continuing
Term agreements
Repurchase agreements4
18 Overnight and continuing
19 Term agreements
16
17
For notes see opposite page.
14,568
32,048
26,754
48,247
24,136
49,425
19,668
49,637
22,351
49,414
22,216
50,187
19,978
51,123
24,087
47,891
20,823
46,993
35,919
29,449
49,695
43,410
56,033
42,891
51,228
43,450
51,702
41,890
52,272
41,769
51,826
43,816
53,252
41,922
53,429
40,313
Federal Finance
1.44
FEDERAL AND FEDERALLY SPONSORED CREDIT AGENCIES
A35
Debt Outstanding
Millions of dollars, end of period
1983
1982
1979
Agency
1980
1981
Sept.
1
1 Federal and federally sponsored agencies
2 Federal agencies
3 Defense Department2
4 Export-Import Bank3 4
5 Federal Housing Administration5
Association
6 Government National Mortgage
participation certificates6
7 Postal Service7
8 Tennessee Valley Authority
9 United States Railway Association7
10 Federally sponsored agencies'
11 Federal Home Loan Banks
12 Federal Home Loan Mortgage Corporation
13 Federal National Mortgage Association
14 Federal Land Banks
15 Federal Intermediate Credit Banks
16 Banks for Cooperatives
17 Farm Credit Banks'
18 Student Loan Marketing Association
19 Other
Oct.
Nov.
Dec.
Jan.
Feb.
247,887 244,243'
Mar.
240,475
163,290
193,229
227,210
245,951
244,599
243,535
247,119
24,715
738
9,191
537
28,606
610
11,250
477
31,806
484
13,339
413
32,606
388
14,042
335
32,713
377
14,000
323
32,772
364
13,999
311
33,055
354
14,218
288
33,018
346
14,267
282
33,045
336
14,255
281
33,083
335
14,304
271
2,979
1,837
8,997
436
2,817
1,770
11,190
492
2,715
1,538
13,115
202
2,165
1,471
14,010
195
2,165
1,471
14,185
192
2,165
1,471
14,270
192
2,165
1,471
14,365
194
2,165
1,471
14,365
122
2,165
1,471
14,415
122
2,165
1,471
14,415
122
212,886 210,763 214,064 214,869 211,198'
60,904 60,356 61,447
59,969 57,515'
3,000
3,000
3,202
3,000
3,000
67,916 66,852 70,052 72,247 72,221
6,813
6,813
6,813
5,802
5,802
926
926
926
926
926
220
220
220
220
220
66,449 65,877 65,014 66,360 65,796
6,657
6,404
6,718
6,591
6,257
1
1
1
1
1
207,392
54,880
2,002
71,366
5,802
926
220
65,653
6,542
1
127,717
138,575 164,623 195,404 213,345
33,330 41,258 58,090 61,251
2,771
2,536
2,604
3,000
48,486 55,185 58,749 68,130
16,006
12,365
9,717
7,652
1,821
2,676
1,388
926
584
584
220
220
33,216 48,153 60,034 65,553
1,505
2,720
6,611
4,600
1
1
2
2
MEMO:
20 Federal Financing Bank debt1'8
21
22
23
24
Lending to federal and federally sponsored
agencies
Export-Import7 Bank4
Postal Service
Tennessee Valley Authority
United States Railway Association7
Other Lending9
25 Farmers Home Administration
26 Rural Electrification Administration
27 Other
67,383
87,460
110,698
124,357
125,064
125,707
126,424
8,353
1,587
7,272
436
10,654
1,520
9,465
492
12,741
1,288
11,390
202
13,954
1,221
12,285
195
13,954
1,221
12,460
192
13,954
1,221
12,545
192
14,177
1,221
12,640
194
14,177
1,221
12,640
122
14,177
1,221
12,690
122
14,232
1,221
12,675
122
32,050
6,484
9,696
39,431
9,196
13,982
48,821
13,516
18,140
53,736
16,282
21,684
53,661
16,600
26,976
53,661
16,750
27,384
53,261
17,157
27,774
53,056
17,330
28,041
52,431
17,502
28,480
52,686
17,816
28,965
1. In September 1977 the Farm Credit Banks issued their first consolidated
bonds, and in January 1979 they began issuing these bonds on a regular basis to
replace the financing activities of the Federal Land Banks, the Federal Intermediate Credit Banks, and the Banks for Cooperatives. Line 17 represents those
consolidated bonds outstanding, as well as any discount notes that have been
issued. Lines 1 and 10 reflect the addition of this item.
2. Consists of mortgages assumed by the Defense Department between 1957
and 1963 under family housing and homeowners assistance programs.
3. Includes participation certificates reclassified as debt beginning Oct. 1, 1976.
4. Off-budget Aug. 17, 1974, through Sept. 30, 1976; on-budget thereafter.
5. Consists of debentures issued in payment of Federal Housing Administration
insurance claims. Once issued, these securities may be sold privately on the
securities market.
6. Certificates of participation issued prior to fiscal 1969 by the Government
National Mortgage Association acting as trustee for the Farmers Home Administration; Department of Health, Education, and Welfare; Department of Housing
NOTES TO TABLE 1.43
1. Immediate positions are net amounts (in terms of par values) of securities
owned by nonbank dealer firms and dealer departments of commercial banks on a
commitment, that is, trade-date basis, including any such securities that have
been sold under agreements to repurchase (RPs). The maturities of some
repurchase agreements are sufficiently long, however, to suggest that the securities involved are not available for trading purposes. Securities owned, and hence
dealer positions, do not include securities to resell (reverse RPs). Before 1981,
data for immediate positions include forward positions.
2. Figures cover financing involving U.S. government and federal agency
securities, negotiable CDs, bankers acceptances, and commercial paper.
126,587 126,623
and Urban Development; Small Business Administration; and the Veterans
Administration.
7. Off-budget.
8. The FFB, which began operations in 1974, is authorized to purchase or sell
obligations issued, sold, or guaranteed by other federal agencies. Since FFB
incurs debt solely for the purpose of lending to other agencies, its debt is not
included in the main portion of the table in order to avoid double counting.
9. Includes FFB purchases of agency assets and guaranteed loans; the latter
contain loans guaranteed by numerous agencies with the guarantees of any
particular agency being generally small. The Farmers Home Administration item
consists exclusively of agency assets, while the Rural Electrification Administration entry contains both agency assets and guaranteed loans.
3. Includes all reverse repurchase agreements, including those that have been
arranged to make delivery on short sales and those for which the securities
obtained have been used as collateral on borrowings, i.e., matched agreements.
4. Includes both repurchase agreements undertaken to finance positions and
"matched book" repurchase agreements.
NOTE. Data for positions are averages of daily figures, in terms of par value,
based on the number of trading days in the period. Positions are shown net and are
on a commitment basis. Data for financing are based on Wednesday figures, in
terms of actual money borrowed or lent.
A36
1.45
DomesticNonfinancialStatistics • June 1983
NEW SECURITY ISSUES of State and Local Governments
Millions of dollars
1982r
Type of issue or issuer,
or use
1980
1981
Sept.
1 All issues, new and refunding1
1983
1982
Oct.
Nov.
Dec.
Jan/
Feb/
Mar/
Apr.
48,367
47,732
78,950
6,673
8,466
10,287
9,761
3,625
5,998
8,141
10,149
14,100
38
34,267
57
12,394
34
35,338
55
21,088
225
57,862
461
1,716
30
4,957
54
2,331
30
6,135
57
3,392
34
6,895
57
1,623
37
8,138
62
847
0
2,778
0
1,250
3
4,748
2
2,230
3
5,911
5
3,278
2
6,871
9
Type of issuer
6 State
7 Special district and statutory authority
8 Municipalities, counties, townships, school districts
5,304
26,972
16,090
5,288
27,499
14,945
8,406
45,000
25,544
1,077
3,607
1,821
1,010
5,160
2,296
1,091
5,489
3,243
220
6,171
3,370
237
2,100
1,288
275
4,123
1,600
724
5,046
2,371
1,745
5,227
3,177
9 Issues for new capital, total
46,736
46,530
74,612
6,470
7,275
9,496
9,531
3,127
4,909
6,709
8,242
Use of proceeds
Education
Transportation
Utilities and conservation
Social welfare
Industrial aid
Other purposes
4,572
2,621
8,149
19,958
3,974
7,462
4,547
3,447
10,037
12,729
7,651
8,119
6,444
6,256
14,254
26,605
8,256
12,797
840
557
292
2,647
1,082
1,052
546
636
1,338
2,918
621
1,212
765
1,291
1,969
2,336
877
2,258
895
1,342
1,891
3,121
1,308
974
352
49
956
817
306
647
1,079
539
1,039
1,391
167
694
811
815
1,716
2,376
330
904
605
559
2,508
2,637
350
1,583
2
3
4
5
10
11
12
13
14
15
Type of issue
General obligation
U.S. government loans2
Revenue
U.S. government loans2
1. Par amounts of long-term issues based on date of sale.
2. Consists of tax-exempt issues guaranteed by the Farmers Home Administration.
1.46
SOURCE. Public Securities Association.
NEW SECURITY ISSUES of Corporations
Millions of dollars
Type of issue or issuer,
or use
1982
1980
1981
Aug.
12
1983
1982
Sept.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
1 All issues -
73,694
69,991
83,788
9,318
8,247
9,989
8,802
9,830
7,598
8,481
11,608
2 Bonds
53,206
44,642
53,226
6,553
5,762
7,121
5,412
5,636
4,470
3,819
5,267
Type of offering
3 Public
4 Private placement
41,587
11,619
37,653
6,989
43,428
9,798
5,546
1,007
5,308
454
6,426
695
4,927
485
4,264
1,372
4,470
n.a.
3,819
n.a.
5,267
n.a.
15,409
6,693
3,329
9,557
6,683
11,534
12,325
5,229
2,052
8,963
4,280
11,793
13,307
5,681
1,474
12,155
2,265
18,344
1,602
1,202
402
934
205
2,208
1,730
481
64
1,021
311
2,156
2,044
417
285
1,663
208
2,504
2,138
523
88
1,246
115
1,302
1,204
565
120
944
372
2,431
849
702
31
313
635
361
250
813
962
511
2,575
1,760
950
650
2,194
11 Stocks3
20,489
25,349
30,562
2,765
2,485
2,868
3,390
4,194
3,128
4,662
6,341
Type
12 Preferred
13 Common
3,631
16,858
1,797
23,552
5,113
25,449
622
2,143
522
1,963
611
2,257
573
2,817
421
3,773
594
2,534
1,962
2,700
893
5,448
4,839
5,245
549
6,230
567
3,059
5,074
7,557
779
5,577
1,778
4,584
5,649
7,770
709
7,517
2,227
6,690
717
375!!
62
759
495
357
345
742
84
1,003
4
307
666
640
80
620
33
829
481
1,024
225
752
14
894
921
693
22
742
1,361
455
876
994
355
350
187
366
1,048
646
283
534
2
2,149
1,584
1,225
91
674
1,133
1,634
5
6
7
8
9
10
14
15
16
17
18
19
Industry group
Manufacturing
Commercial and miscellaneous
Public utility
Real estate and financial
Industry group
Manufacturing
Commercial and miscellaneous
Transportation
Public utility
Communication
Real estate and financial
1. Figures, which represent gross proceeds of issues maturing in more than one
year, sold for cash in the United States, are principal amount or number of units
multiplied by offering price. Excludes offerings of less than $100,000, secondary
offerings, undefined or exempted issues as defined in the Securities Act of 1933,
employee stock plans, investment companies otheT than closed-end, intracorporate transactions, and sales to foreigners.
2. Data for 1983 include only public offerings.
3. Beginning in August 1981, gross stock offerings include new equity volume
from swaps of debt for equity.
SOURCE. Securities and Exchange Commission and the Board of Governors of
the Federal Reserve System.
Corporate Finance
1.47
OPEN-END INVESTMENT COMPANIES
A37
Net Sales and Asset Position
Millions of dollars
1983
1982
Item
1981
1982
Oct.
Sept.
Nov.
Jan.
Dec.
Feb.
Mar/
Apr.
INVESTMENT COMPANIES'
1 Sales of own shares2
2 Redemptions of own shares3
3 Net sales
20,596
15,866
4,730
45,675
30,078
15,597
4,709
3,052
1,657
5,668
3,046
2,622
5,815
3,493
2,322
5,291
4,835
456
8,095
4,233
3,862
6,115
3,510
2,605
7,871
5,066
2,805
8,421
6,482
1,939
4 Assets4
5
Cash position5
6
Other
55,207
5,277
49,930
76,741
5,999
70,742
63,783
5,556
58,227
70,964
5,948
65,016
74,864
5,838
69,026
76,841
6,040
70,801
80,384
6,943
73,441
84,981
7,404
77,577
90,075
7,904
82,171
98,660
8,948
89,712
5. Also includes all U.S. government securities and other short-term debt
securities.
1. Excluding money market funds.
2. Includes reinvestment of investment income dividends. Excludes reinvestment of capital gains distributions and share issue of conversions from one fund to
another in the same group.
3. Excludes share redemption resulting from conversions from one fund to
another in the same group.
4. Market value at end of period, less current liabilities.
1.48
NOTE. Investment Company Institute data based on reports of members, which
comprise substantially all open-end investment companies registered with the
Securities and Exchange Commission. Data reflect newly formed companies after
their initial offering of securities.
CORPORATE PROFITS AND THEIR DISTRIBUTION
Billions of dollars; quarterly data are at seasonally adjusted annual rates.
1982
1981
Account
1980
1981
1983
1982
Q2
Q3
Q4
QL
Q2
Q3
Q4
QL
2
3
4
5
6
1 Corporate profits with inventory valuation and
capital consumption adjustment
Profits before tax
Profits tax liability
Profits after tax
Dividends
Undistributed profits
181.6
242.4
84.6
157.8
58.1
99.7
190.6
232.1
81.2
150.9
65.1
85.8
160.8
174.9
57.7
117.1
70.3
46.9
185.1
225.4
79.2
146.2
64.0
82.2
193.1
233.3
82.4
150.9
66.8
84.1
183.9
216.5
71.6
144.9
68.1
76.8
157.1
171.6
56.7
114.9
68.8
46.1
155.4
171.7
55.3
116.3
69.3
47.0
166.2
180.3
60.9
119.4
70.5
48.8
164.6
175.9
58.0
117.9
72.4
45.5
185.4
178.3
65.7
112.5
73.5
39.0
7 Inventory valuation
8 Capital consumption adjustment
-43.0
-17.8
-24.6
-16.8
-9.2
-4.9
-22.8
-17.5
-23.0
-17.1
-17.1
-15.5
-4.4
-10.1
-9.4
-6.9
-10.3
-3.8
-12.6
1.3
-.7
7.8
SOURCE. Survey of Current Business (U.S. Department of Commerce).
A38
DomesticNonfinancialStatistics • June 1983
1.49 NONFINANCIAL CORPORATIONS
Current Assets and Liabilities
Billions of dollars, except for ratio
1982r
1981
Account
1976
1977
1978
1979
1980
Q4
Ql
Q2
Q3
Q4
1 Current assets
827.4
912.7
1,043.7
1,218.2
1,333.5
1,426.8
1,424.6
1,422.6
1,446.9
1,430.9
2
3
4
5
6
88.2
23.5
292.9
342.5
80.3
97.2
18.2
330.3
376.9
90.1
105.5
17.3
388.0
431.6
101.3
118.0
17.0
461.1
505.5
116.7
127.1
19.3
510.6
543.7
132.7
131.9
18.0
536.2
587.1
153.6
122.0
16.9
539.2
592.7
153.7
124.4
17.1
536.8
588.4
155.8
126.9
19.6
539.7
598.0
162.7
143.7
23.1
517.0
577.5
169.6
7 Current liabilities
495.1
557.1
669.3
807.8
890.9
979.5
988.0
987.5
1,005.2
976.5
8 Notes and accounts payable
9 Other
282.1
213.0
317.6
239.6
382.9
286.4
461.2
346.6
515.2
375.7
562.4
417.1
555.5
432.5
555.1
432.4
559.7
445.5
548.7
427.8
10 Net working capital
332.4
355.5
374.4
410.5
442.6
447.3
436.6
435.1
441.7
454.4
11 MEMO: Current ratio1
1.671
1.638
1.559
1.508
1.497
1.457
1.442
1.441
1.439
1.465
Cash
U.S. government securities
Notes and accounts receivable
Inventories
Other
1. Ratio of total current assets to total current liabilities.
NOTE. For a description of this series, see "Working Capital of Nonfinancial
All data in this table reflect the most current benchmarks. Complete data are
available upon request from the Flow of Funds Section, Division of Research and
Statistics.
C o r p o r a t i o n s " in the July 1978 BULLETIN, p p . 533-37.
SOURCE. Federal Trade Commission.
1.50 TOTAL NONFARM BUSINESS EXPENDITURES on New Plant and Equipment
Billions of dollars; quarterly data are at seasonally adjusted annual rates.
1982
Industry1
1 Total nonfarm business
Manufacturing
7 Durable goods industries
3 Nondurable goods industries
Nonmanufacturing
4 Mining
Transportation
5 Railroad
6 Air
7 Other
Public utilities
8 Electric
9 Gas and other
10 Trade and services
2
11 Communication and other
1981
1982
Q2
Q3
Q4
Ql
Q21
Q3'
Q41
321.49
316.43
305.53
323.22
315.79
302.77
293.03
302.23
306.83
320.02
61.84
64.95
56.44
63.23
51.95
60.84
59.03
64.74
57.14
62.32
50.50
59.59
50.74
59.12
49.64
61.34
53.34
60.75
54.09
62.15
16.86
15.45
13.24
16.56
14.63
13.31
12.03
13.69
13.54
13.70
4.24
3.81
4.00
4.38
3.93
3.64
3.96
3.42
3.42
4.73
3.54
4.06
3.94
4.11
3.24
4.31
4.85
3.25
3.35
4.09
3.60
4.00
3.25
3.40
4.09
2.68
3.17
4.41
3.66
3.51
29.74
8.65
86.33
41.06
33.40
8.55
86.95
40.46
33.84
7.76
87.13
39.97
32.26
9.14
88.85
40.33
34.98
8.40
87.31
39.73
35.12
7.77
84.00
40.06
33.97
7.64
82.38
36.11
34.16
8.03
85.33
39.40
32.97
7.48
87.41
41.39
34.24
7.87
93.37
43.00
1. Anticipated by business.
2. "Other" consists of construction; social services and membership organizations; and forestry, fisheries, and agricultural services.
1983
19831
SOURCE. Survey of Current Business (U.S. Dept. of Commerce).
Corporate Finance
1.51
DOMESTIC FINANCE COMPANIES
A39
Assets and Liabilities
Billions of dollars, end of period
1982
Account
1977
1978
1979
1980
1983
1981
Q4
Q3
Q2
Q1
Q1
ASSETS
Accounts receivable, gross
1 Consumer
2 Business
Total
4 LESS: Reserves for unearned income and losses....
,5 Accounts receivable, net
6 Cash and bank deposits
7 Securities
8 All other
9 Total assets
65.7
52.6
70.3
63.3
116.0
136.0
15.6
20.0
100.4
116.0
3.5 1
1.3 V 24.9'
17.3 J
73.6
72.3
145.9
23.3
122.6
85.5
80.6
166.1
28.9
137.2
85.1
80.9
166.0
29.1
136.9
88.0
82.6
170.6
30.2
"140.4
88.3
82.2
170.5
30.4
140.1
89.5
81.0
170.4
30.5
139.8
89.9
82.2
172.1
29.7
142.4
27.5
34.2
35.0
37.3
39.1
39.7
42.8
104.3
122.4
140.9
150.1
171.4
171.9
177.8
179.2
179.5
185.2
5.9
29.6
6.5
34.5
8.5
43.3
13.2
43.4
15.4
51.2
15.4
46.2
14.5
50.3
16.8
46.7
18.6
45.8
16.6
45.2
6.2
36.0
11.5
8.1
43.6
12.6
8.2
46.7
14.2
7.5
52.4
14.3
9.6
54.8
17.8
9.0
59.0
19.0
9.3
60.3
18.9
9.9
60.9
20.5
8.7
63.5
18.7
9.8
64.7
22.8
44.0
55.2
99.2
12.7
86.5
2.6
.9
14.3
LIABILITIES
10 Bank loans
11 Commercial paper
Debt
12 Short-term, n.e.c
13 Long-term, n.e.c
14 Other
15 Capital, surplus, and undivided profits
16 Total liabilities and capital
15.1
17.2
19.9
19.4
22.8
23.3
24.5
24.5
24.2
26.0
104.3
122.4
140.9
150.1
171.4
171.9
177.8
179.2
179.5
185.2
1. Beginning Q1 1979, asset items on lines 6, 7, and 8 are combined.
NOTE. Components may not add to totals due to rounding.
1.52
DOMESTIC FINANCE COMPANIES
Business Credit
Millions of dollars, seasonally adjusted except as noted
Type
Accounts
receivable
outstanding
Mar. 31,
1983'
Changes in accounts
receivable
Extensions
Repayments
1983
1983
1983
Jan.
Feb.
Mar.
Jan.
Feb.
Mar.
Jan.
Feb.
Mar.
1 Total
82,239
1,030
126
-80
22,808
22,458
23,924
21,778
22,332
24,004
2
3
4
5
13,772
12,525
27,627
269
182
-41
396
115
381
645
-590
283
1,230
6,458
1,308
1,336
6,643
1,477
1,604
6,058
1,252
961
6,276
1,349
940
6,258
1,096
959
6,648
969
9,320
18,995
501
119
-243
-523
102
-520
12,286
1,526
11,634
1,368
13,327
1,683
11,785
1,407
11,877
1,891
13,225
2,203
Retail automotive (commercial vehicles)
Wholesale automotive
Retail paper on business, industrial, and farm equipment
Loans on commercial accounts receivable and factored commercial accounts receivable
6 All other business credit
1. Not seasonally adjusted.
A40
1.53
Domestic Financial Statistics • June 1983
MORTGAGE MARKETS
Millions of dollars; exceptions noted.
1982
Item
1980
1981
1983
1982
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
Terms and yields in primary and secondary markets
PRIMARY MARKETS
1
2
3
4
5
6
Conventional mortgages on new homes
Terms'
Purchase price (thousands of dollars)
Amount of loan (thousands of dollars)
Loan/price ratio (percent)
Maturity (years)
Fees and charges (percent of loan amount)2
Contract rate (percent per annum)
Yield (percent 5per annum)
7 FHLBB series
8 HUD series4
83.4
59.2
73.2
28.2
2.09
12.25
90.4
65.3
74.8
27.7
2.67
14.16
94.6
69.8
76.6
27.6
2.95
14.47
99.1
74.4
77.9
28.4
2.74
13.86
97.9
75.6
79.0
27.9
2.76
13.26
91.8
67.6
75.2
26.9
2.98
13.09
88.9
65.4
75.2
26.5
2.46
13.00
88.4
66.6
77.9
27.2
2.78
12.62
80.1
60.5
76.8
24.2
2.21
12.97
89.6
66.5
74.2
26.9
2.09
12.02
12.65
13.95
14.74
16.52
15.12
15.79
14.41
13.95
13.81
13.80
13.69
13.62
13.49
13.44
13.16
13.18
13.41
13.17
12.42
13.02
13.44
12.55
16.31
15.29
15.31
14.68
12.99
12.83
12.82
12.66
12.80
12.60
12.87
12.06
12.65
11.94
12.68
11.87
12.50
11.76
14.11
14.43
16.70
16.64
15.95
13.92
13.75
13.72
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
SECONDARY MARKETS
Yield (percent per annum)
9 FHA mortgages (HUD
series)5
6
10 GNMA securities
FNMA auctions7
Activity in secondary markets
FEDERAL NATIONAL MORTGAGE ASSOCIATION
Mortgage holdings (end of period)
13 Total
14 FHA/V A-insured
15 Conventional
55,104
37,365
17,725
58,675
39,341
19,334
66,031
39,718
26,312
69,152
39,523
29,629
70,126
39,174
30,952
71,814
39,057
32,757
73,106
38,924
34,182
73,555
38,768
34,788
73,666
38,409
35,257
73,553
37,901
35,653
Mortgage transactions (during period)
16 Purchases
17 Sales
8,099
0
6,112
2
15,116
2
1,449
1
1,681
1
2,495
1
2,045
0
1,594
1
1,433
777
1,004
586
Mortgage commitments8
18 Contracted (during period)
19 Outstanding (end of period)
8,083
3,278
9,331
3,717
22,105
7,606
1,426
6,268
2,795
7,286
3,055
7,606
2,006
7,487
785
6,475
1,184
6,187
1,023
5,811
8,605.4
4,002.0
2,487.2
1,478.0
307.4
104.3
2.5
0
27.0
0
4.6
0
2.0
0
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
3,639.2
1,748.5
2,524.7
1,392.3
445.3
237.6
13.6
8.9
22.1
11.4
23.2
15.3
7.8
0
1.8
n.a.
n.a.
n.a.
n.a.
n.a.
Mortgage holdings (end of period)9
24 Total
25 FHA/V A
26 Conventional
4,362
2,116
2,246
5,245
2,236
3,010
5,153
1,921
3,224
4,957
1,016
3,891
4,676
1,012
3,618
4,733
1,009
3,724
4,560
1,004
3,556
4,450
1,000
3,450
4,795
995
3,800
4,997
990
4,008
Mortgage transactions (during period)
27 Purchases
28 Sales
3,723
2,527
3,789
3,531
23,671
24,164
2,000
2,197
1,917
2,182
3,916
3,798
1,479
1,641
1,688
1,756
2,849
2,469
1,807
1,525
3,859
447
6,974
3,518
28,187
7,549
2,506
10,572
1,714
10,407
1,068
7,549
2,059
8,098
868
7,238
1,438
5,845
3,079
7,253
Auction of 4-month commitments to buy
Government-underwritten loans
Offered
Accepted
Conventional loans
22 Offered
23 Accepted
20
21
FEDERAL HOME LOAN MORTGAGE CORPORATION
10
Mortgage commitments
29 Contracted (during period)
30 Outstanding (end of period)
1. Weighted averages based on sample surveys of mortgages originated by
major institutional lender groups. Compiled by the Federal Home Loan Bank
Board in cooperation with the Federal Deposit Insurance Corporation.
2. Includes all fees, commissions, discounts, and "points" paid (by the
borrower or the seller) to obtain a loan.
3. Average effective interest rates on loans closed, assuming prepayment at the
end of 10 years.
4. Average contract rates on new commitments for conventional first mortgages, rounded to the nearest 5 basis points; from Department of Housing and
Urban Development.
5. Average gross yields on 30-year, minimum-downpayment, Federal Housing
Administration-insured first mortgages for immediate delivery in the private
secondary market. Any gaps in data are due to periods of adjustment to changes in
maximum permissible contract rates.
6. Average net yields to investors on Government National Mortgage Association guaranteed, mortgage-backed, fully modified pass-through securities, assuming prepayment in 12 years on pools of 30-year FHAA'A mortgages carrying the
prevailing ceiling rate. Monthly figures are unweighted averages of Monday
quotations for the month.
7. Average gross yields (before deduction of 38 basis points for mortgage
servicing) on accepted bids in Federal National Mortgage Association's auctions
of 4-month commitments to purchase home mortgages, assuming prepayment in
12 years for 30-year mortgages. No adjustments are made for FNMA commitment
fees or stock related requirements. Monthly figures are unweighted averages for
auctions conducted within the month. FNMA's commitment auctions were
discontinued in March 1983.
8. Includes some multifamily and nonprofit hospital loan commitments in
addition to 1- to 4-family loan commitments accepted in FNMA's free market
auction system, and through the FNMA-GNMA tandem plans.
9. Includes participation as well as whole loans.
10. Includes conventional and government-underwritten loans. FHLMC's
mortgage commitments and mortgage transactions include activity under mortgage/securities swap programs, while the corresponding data for FNMA exclude
swap activity.
Real Estate Debt
1.54
A41
MORTGAGE DEBT OUTSTANDING
Millions of dollars, end of period
1982
Type of holder, and type of property
1980
1981
QL
1 All holders
1- to 4-family
3 Multifamily
4 Commercial
5
?
1983
1982
Q2
Q4
Q3
QL
1,471,786
986,979
137,134
255,655
92,018
1,583,264
1,065,294
136,354
279,889
101,727
1,652,126'
1,112,352'
136,515
296,369'
106,890
1,602,855
1,076,930
137,712
284,306
103,907
1,624,279
1,089,522
138,332
290,951
105,474
1,632,161 1,652,126' 1,679,911'
1,097,507 1,112,352' 1,133,012'
138,164'
136,515
136,508
301,703'
291,740
296,369'
106,406
106,890
107,032'
1,027,027 1,020,527
298,342
301,742
175,126
177,122
15,841
15,666
99,050
100,269
8,500
8,510
7
8
9
10
11
Major financial institutions
Commercial banks'
1- to 4-family
Multifamily
Commercial
Farm
997,168
263,030
160,326
12,924
81,081
8,699
1,040,827
284,536
170,013
15,132
91,026
8,365
1,020,527
301,742
177,122
15,841
100,269
8,510
1,041,702
289,365
171,350
15,338
94,256
8,421
1,042,904
294,022
172,5%
15,431
97,522
8,473
12
13
14
15
16
Mutual savings banks
1- to 4-family
Multifamily
Commercial
Farm
99,865
67,489
16,058
16,278
40
99,997
68,187
15,960
15,810
40
94,452
64,095
15,037
15,292
28
97,464
66,305
15,536
15,594
29
96,346
65,381
15,338
15,598
29
94,382
63,849
15,026
15,479
28
94,452
64,095
15,037
15,292
28
93,697
63,582
14,917
15,170
28
17
18
19
20
Savings and loan associations
1- to 4-family
Multifamily
Commercial
503,192
419,763
38,142
45,287
518,547
433,142
37,699
47,706
482,414
398,537'
36,023
47,854'
516,111
430,178
37,986
47,947
512,997
425,890
38,321
48,786
493,899
410,035
36,894
46,970
482,414
398,537'
36,023
47,854'
484,08C
397,178'
36,511'
50,391'
21
22
23
24
25
Life insurance companies
1- to 4-family
Multifamily
Commercial
Farm
131,081
17,943
19,514
80,666
12,958
137,747
17,201
19,283
88,163
13,100
141,919
16,743
18,847
93,501
12,828
138,762
17,086
19,199
89,529
12,948
139,539
16,451
18,982
91,113
12,993
140,404
16,865
18,967
91,640
12,932
141,919
16,743
18,847
93,501
12,828
143,133
16,836
19,054
94,618
12,625
114,300
4,642
704
3,938
126,094
4,765
693
4,072
138,185
4,227
676
3,551
128,698
4,438
689
3,749
131,456
4,669
688
3,981
134,449
4,110
682
3,428
138,185
4,227
676
3,551
140,023'
3,785
665
3,120
26 Federal and related agencies
27 Government National Mortgage Association
28
1- to 4-family
Multifamily
29
1,026,582'
305,672
179,430
16,147
101,575
8,520
30
31
32
33
34
Farmers Home Administration
1- to 4-family
Multifamily
Commercial
Farm
3,492
916
610
411
1,555
2,235
914
473
506
342
1,786
783
218
377
408
2,469
715
615
499
640
1,335
491
179
256
409
947
302
46
164
435
1,786
783
218
377
408
2,077'
707'
38(K
337'
653'
35
36
37
Federal Housing and Veterans
Administration
1- to 4-family
Multifamily
5,640
2,051
3,589
5,999
2,289
3,710
5,228
1,980
3,248
6,003
2,266
3,737
5,908
2,218
3,690
5,362
2,130
3,232
5,228
1,980
3,248
5,156
1,883
3,273
38
39
40
Federal National Mortgage Association
1- to 4-family
Multifamily
57,327
51,775
5,552
61,412
55,986
5,426
71,814
66,500
5,314
62,544
57,142
5,402
65,008
59,631
5,377
68,841
63,495
5,346
71,814
66,500
5,314
73,666
68,370
5,2%
41
42
43
Federal Land Banks
1- to 4-family
Farm
38,131
2,099
36,032
46,446
2,788
43,658
50,350
3,068
47,282
47,947
2,874
45,073
49,270
2,954
46,316
49,983
3,029
46,954
50,350
3,068
47,282
50,544
3,059
47,485
44
45
46
Federal Home Loan Mortgage Corporation
1- to 4-family
Multifamily
5,068
3,873
1,195
5,237
5,181
56
4,780
4,733
47
5,297
5,240
57
5,266
5,209
57
5,166
5,116
50
4,780
4,733
47
4,795
4,740
55
142,258
93,874
91,602
2,272
163,000
105,790
103,007
2,783
216,654'
118,940'
115,831'
3,109
172,303
108,592
105,701
2,891
183,657
111,459
108,487
2,972
198,376
114,776
111,728
3,048
216,654'
118,940'
115,831'
3,109
234,5%'
127,939'
124,482'
3,457
16,854
13,471
3,383
19,853
19,501
352
42,964
42,560
404
23,970
23,610
360
28,703
28,329
374
35,132
34,739
393
42,964
42,560
404
48,008
47,575
433
717
717
14,450
14,450
2,786
2,786
4,556
4,556
8,133
8,133
14,450
14,450
18,157
18,157
31,530
16,683
2,612
5,271
6,964
36,640
18,378
3,426
6,161
8,675
40,300
20,005
4,344
7,011
8,940
36,955
18,740
3,447
6,351
8,417
38,939
19,357
4,044
6,762
8,776
40,335
20,079
4,344
7,056
8,856
40,300
20,005
4,344
7,011
8,940
40,492'
20,263'
4,344'
7,115'
8,770'
218,060
138,284
27,345
26,661
25,770
253,343
167,297
27,982
30,517
27,547
276,760'
185,269'
30,532
32,065
28,894
260,152
172,248
29,395
30,130
28,379
266,262
177,284
29,586
30,914
28,478
272,349
182,199
30,068
31,381
28,701
276,760'
185,269'
30,532
32,065
28,894
278.710'
186,085'
31,177
32,497
28,951
47 Mortgage pools or trusts2
48 Government National Mortgage Association
49
1- to 4-family
50
Multifamily
51
52
53
Federal Home Loan Mortgage Corporation
1- to 4-family
Multifamily
54
55
Federal National Mortgage Association3
1- to 4-family
56
57
58
59
60
Farmers Home Administration
I- to 4-family
Multifamily
Commercial
Farm
4
61 Individual and others
62 1- to 4-family5
63 Multifamily
64 Commercial
65 Farm
n.a.
n.a.
1. Includes loans held by nondeposit trust companies but not bank trust
departments.
2. Outstanding principal balances of mortgages backing securities insured or
guaranteed by the agency indicated.
3. Outstanding balances on FNMA's issues of securities backed by pools of
conventional mortgages held in trust. The program was implemented by FNMA in
October (981.
4. Other holders include mortgage companies, real estate investment trusts,
state and local credit agencies, state and local retirement funds, noninsured
pension funds, credit unions, and U.S. agencies for which amounts are small or
for which separate data are not readily available.
5. Includes a new estimate of residential mortgage credit provided by individuals.
NOTE. Based on data from various institutional and governmental sources, with
some quarters estimated in part by the Federal Reserve in conjunction with the
Federal Home Loan Bank Board and the Department of Commerce. Separation of
nonfarm mortgage debt by type of property, if not reported directly, and
interpolations and extrapolations when required, are estimated mainly by the
Federal Reserve. Multifamily debt refers to loans on structures of five or more
units.
A42
1.55
DomesticNonfinancialStatistics • June 1983
CONSUMER INSTALLMENT CREDIT1 Total Outstanding, and Net ChangeA
Millions of dollars
1982
1980
1981
1983
1982
Sept.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
Amounts outstanding (end of period)
1 Total
313,472
331,697
344,798
337,469
336,473
338,372
344,798
343,151
340,343
342,568
344,748
By major holder
Commercial banks
Finance companies
Credit unions
Retailers2
Savings and loans
Gasoline companies
Mutual savings banks
147,013
76,756
44,041
28,448
9,911
4,468
2,835
147,622
89,818
45,954
29,551
11,598
4,403
2,751
152,069
94,322
47,253
30,202
13,891
4,063
2,998
149,801
93,357
46,846
26,829
13,051
4,669
2,916
149,528
92,541
46,645
27,046
13,457
4,322
2,934
149,651
93,462
46,832
27,639
13,672
4,141
2,975
152,069
94,322
47,253
30,202
13,891
4,063
2,998
150,906
95,080
46,946
28,859
14,209
4,102
3,049
150,257
93,859
46,757
27,734
14,860
3,780
3,096
151,319
94,817
47,081
27,472
15,083
3,669
3,127
152,408
94,675
47,505
27,455
15,551
3,980
3,174
By major type of credit
9 Automobile
10 Commercial banks
11
Indirect paper
12
Direct loans
13 Credit unions
14 Finance companies
116,838
61,536
35,233
26,303
21,060
34,242
125,331
58,081
34,375
23,706
21,975
45,275
130,227
58,851
35,178
23,673
22,596
48,780
128,856
58,542
34,728
23,814
22,402
47,921
128,375
58,552
34,744
23,808
22,306
47,518
129,299
58,701
34,884
23,817
22,395
48,203
130,227
58,851
35,178
23,673
22,596
48,780
129,482
57,740
129,055
57,971
130,959
58,567
131,976
59,291
22,458
49,284
22,360
48,724
22,518
49,874
22,721
49,964
15 Revolving
16 Commercial banks
17 Retailers
18 Gasoline companies
58,352
29,765
24,119
4,468
62,819
32,880
25,536
4,403
67,184
36,688
26,433
4,063
61,845
34,017
23,159
4,669
61,836
34,110
23,404
4,322
62,362
34,233
23,988
4,141
67,184
36,688
26,433
4,063
65,562
36,282
25,178
4,102
63,372
35,481
24,111
3,780
63,091
35,533
23,889
3,669
63,521
35,651
23,890
3,980
19 Mobile home
20 Commercial banks
21 Finance companies
22 Savings and loans
23 Credit unions
17,322
10,371
3,745
2,737
469
18,373
10,187
4,494
3,203
489
18,988
9,684
4,965
3,836
503
19,011
9,956
4,953
3,604
498
19,043
9,860
4,971
3,716
496
19,049
9,806
4,970
3,775
498
18,988
9,684
4,965
3,836
503
19,291
9,828
4,981
3,984
498
19,374
9,806
4,960
4,112
496
19,379
9,739
4,967
4,174
499
19,400
9,624
4,970
4,303
503
120,960
45,341
38,769
22,512
4,329
7,174
2,835
125,174
46,474
40,049
23,490
4,015
8,395
2,751
128,399
46,846
40,577
24,154
3,769
10,055
2,998
127,748
47,286
40,483
23,946
3,670
9,447
2,916
127,219
47,006
40,052
23,844
3,642
9,741
2,934
127,662
46,911
40,289
23,939
3,651
9,897
2,975
128,399
46,846
40,577
24,154
3,769
10,055
2,998
128,816
47,056
40,815
23,990
3,681
10,225
3,049
128,542
46,999
40,175
23,901
3,623
10,748
3,096
129,139
47,480
39,976
24,064
3,583
10,909
3,127
129,851
47,842
39,741
24,281
3,565
11,248
3,174
2
3
4
5
6
7
8
24 Other
25 Commercial banks
26 Finance companies
27 Credit unions
28 Retailers
29 Savings and loans
30 Mutual savings banks
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
Net change (during period)4
31 Total
1,448
18,217
13,096
1,256
-131
2,015
2,418
2,725
735
2,582
2,271
-7,163
8,438
-2,475
329
1,485
739
95
607
13,062
1,913
1,103
1,682
-65
-85
4,442
4,504
1,298
651
2,290
-340
251
688
106
255
69
200
-88
26
73
-372
38
-67
274
-108
31
457
1,051
412
-51
181
-35
0
1,111
1,024
197
-91
201
-51
27
410
1,881
20
-14
412
-78
94
788
-658
43
36
677
-200
49
1,354
487
143
422
187
-35
24
1,186
-520
708
147
394
299
57
477
-5,830
-3,104
-2,726
-1,184
7,491
8,495
-3,455
-858
-2,597
914
11,033
4,898
770
803
-33
622
3,505
349
360
238
122
110
-121
-70
137
117
20
16
-223
1,534
336
134
202
211
987
1,491
527
429
98
89
875
625
-581
-233
321
1,221
240
689
612
20
1,186
15
-569
68
913
341
-264
45 Revolving
46 Commercial banks
47 Retailers
48 Gasoline companies
1,415
-97
773
739
4,467
3,115
1,417
-65
4,365
3,808
897
-340
311
311
88
-88
81
223
-34
-108
39
74
0
-35
501
650
-98
-51
68
130
16
-78
-135
61
4
-200
1,177
786
426
-35
917
468
150
299
49 Mobile home
50 Commercial banks
51 Finance companies
52 Savings and loans
53 Credit unions
483
-276
355
430
-25
1,049
-186
749
466
20
609
-508
471
633
14
75
-6
18
60
3
-35
-105
-9
78
1
23
-47
5
61
4
-37
-74
-15
49
3
420
193
53
175
-1
204
26
59
120
-1
-61
-95
-23
54
3
22
-99
8
107
6
-927
-960
592
-1,266
-444
1,056
95
4,206
1,133
1,280
975
-314
1,217
-85
3,224
372
528
662
-246
1,657
251
521
23
209
142
-19
140
26
-107
-182
-140
21
-33
196
31
419
94
59
197
-51
120
0
463
8
164
105
7
152
27
1,612
668
642
1
-30
237
94
899
380
-148
29
32
557
49
245
423
-403
72
-4
133
24
643
205
-264
361
-3
287
57
32
33
34
35
36
37
38
By major holder
Commercial banks
Finance companies
Credit unions
Retailers2
Savings and loans
Gasoline companies
Mutual savings banks
By major type of credit
39 Automobile
40 Commercial banks
41
Indirect paper
42
Direct loans
43 Credit unions
44 Finance companies
54 Other
55 Commercial banks
56 Finance companies
57 Credit unions
58 Retailers
59 Savings and loans
60 Mutual savings banks
1. The Board's series cover most short- and intermediate-term credit extended
to individuals through regular business channels, usually to finance the purchase
of consumer goods and services or to refinance debts incurred for such purposes,
and scheduled to be repaid (or with the option of repayment) in two or more
installments.
2. Includes auto dealers and excludes 30-day charge credit held by travel and
entertainment companies.
3. Not reported after December 1982.
4. For 1982 and earlier, net change equals extensions, seasonally adjusted less
(33)
(>
(33)
()
(33)
()
(33)
()
liquidations, seasonally adjusted. Beginning 1983, net change equals outstandings,
seasonally adjusted less outstandings of the previous period, seasonally adjusted.
NOTE: Total consumer noninstallment credit outstanding—credit scheduled to
be repaid in a lump sum, including single-payment loans, charge accounts, and
service credit—amounted to, not seasonally adjusted, $74.8 billion at the end of
1980, $80.6 billion at the end of 1981, and $85.9 billion at the end of 1982.
• These data have been revised from December 1980 through February 1983.
Consumer Debt
1.56 TERMS OF CONSUMER INSTALLMENT CREDIT
Percent unless noted otherwise
1983
1982
Item
Feb.
Mar.
INTEREST RATES
Commercial banks'
1 48-month new car2
2 24-month personal
3 120-month mobile home2
4 Credit card
Auto finance companies
5 New car
6 Used car
14.30
15.47
14.99
17.31
16.54
18.09
17.45
17.78
16.83
18.65
18.05
18.51
15.97
17.99
17.55
18.75
14.82
19.10
16.17
20.00
16.15
20.75
12.82
20.68
12.57
20.63
45.0
34.8
45.4
35.8
46.0
34.0
46.4
36.9
87.6
94.2
91.8
85.3
90.3
6,322
3,810
7,339
4,343
8.178
4,746
14.81
17.47
16.73
18.82
20.20
12.05
19.91
12.07
19.38
46.4
36.9
46.0
38.2
45.9
37.7
45.9
37.7
87.0
91.0
87.0
90.0
86.0
86.0
90.0
90.0
84.0
91.0
8,339
4,822
8,468
4,846
8,683
4,742
8,755
4,731
8,829
4,802
12.25
OTHER TERMS3
7
8
9
10
11
12
Maturity (months)
New car
Used car
Loan-to-value ratio
New car
Used car
Amount financed (dollars)
New car
Used car
1. Data for midmonth of quarter only.
2. Before 1983 the maturity for new car loans was 36 months, and for mobile
home loans was 84 months.
3. At auto finance companies.
A43
A44
1.57
DomesticNonfinancialStatistics • June 1983
FUNDS RAISED IN U.S. CREDIT MARKETS
Billions of dollars; half-yearly data are at seasonally adjusted annual rates.
1980
1977
1981
1982
1978
HI
H2
HI
H2
HI
H2
Nonfinancial sectors
1 Total net borrowing by domestic nonfinancial sectors . . . .
By sector and instrument
2 U.S. government
3 Treasury securities
4 Agency issues and mortgages
5 Private domestic nonfinancial sectors
6 Debt capital instruments
7
Tax-exempt obligations
8
Corporate bonds
9
Mortgages
10
Home mortgages
11
Multifamily residential
12
Commercial
13
Farm
14
15
16
17
18
Other debt instruments
Consumer credit
Bank loans n.e.c
Open market paper
Other
19
20
21
22
23
24
By borrowing sector
State and local governments
Households
Farm
Nonfarm noncorporate
Corporate
25 Foreign net borrowing in U.S
26 Bonds
27 Bank loans n.e.c
28 Open market paper
29 U.S. government loans
30 Total domestic plus foreign
317.7
368.6
388.8
355.0
391.1
412.7
325.1
384.9
402.7
379.6
365.9
459.6
56.8
57.6
-.9
53.7
55.1
-1.4
37.4
38.8
-1.4
79.2
79.8
-.6
87.4
87.8
-.5
161.3
162.1
-.9
63.3
63.9
-.6
95.1
95.7
-.6
81.9
82.4
-.5
92.9
93.2
-.4
100.2
101.5
-1.4
222.4
222.7
-.4
260.9
169.8
21.9
21.0
126.9
94.3
7.1
18.4
314.9
198.7
28.4
20.1
150.2
112.1
9.2
21.7
7.2
351.5
216.0
29.8
22.5
163.7
120.1
7.8
23.9
11.8
275.8
204.1
35.9
33.2
135.1
96.7
8.8
20.2
9.3
303.7
175.0
32.9
23.9
118.3
78.6
4.6
25.3
9.8
251.5
168.4
59.5
25.5
83.3
58.8
1.3
18.0
5.2
261.9
203.8
30.7
37.3
135.8
96.5
8.1
20.3
10.9
289.7
204.4
41.0
29.0
134.3
96.9
9.5
20.1
7.8
320.8
196.5
35.1
24.7
136.7
95.2
5.1
27.4
9.0
286.7
153.5
30.6
23.0
99.9
62.0
4.1
23.2
10.5
265.7
157.1
52.7
13.4
91.1
58.6
4.2
22.8
5.4
237.2
179.7
66.3
37.7
75.6
59.0
-1.6
13.3
4.9
91.1
40.2
26.7
2.9
21.3
116.2
48.8
37.1
5.2
25.1
135.5
45.4
49.2
11.1
29.7
71.7
4.9
35.4
6.6
24.9
128.8
25.3
51.1
19.2
33.1
83.0
14.4
57.4
-2.8
14.0
58.1
-3.3
18.0
20.3
23.0
85.4
13.0
52.7
-7.1
26.7
124.3
29.4
47.7
10.7
36.5
133.2
21.2
54.6
27.6
29.8
108.6
14.4
77.4
4.4
12.4
57.5
14.4
37.5
-9.9
15.6
260.9
15.4
137.3
12.3
28.3
67.6
314.9
19.1
169.3
14.6
32.4
79.4
351.5
20.2
176.5
21.4
34.4
99.0
275.8
27.3
117.5
14.4
33.8
82.8
303.7
22.3
120.4
16.4
40.5
104.1
251.5
45.8
88.5
9.0
24.7
83.5
261.9
21.8
115.2
15.7
27.5
81.7
289.7
32.8
119.8
13.0
40.2
83.9
320.8
25.1
141.0
19.9
41.8
93.0
286.7
19.5
99.9
12.8
39.3
115.2
265.7
41.1
88.1
8.4
32.4
95.7
237.2
50.4
89.0
9.6
16.9
71.2
13.5
5.1
3.1
2.4
3.0
33.8
4.2
19.1
6.6
3.9
20.2
3.9
2.3
11.2
2.9
27.2
.8
11.5
10.1
4.7
27.3
5.5
3.7
13.9
4.3
15.3
6.4
-6.2
10.7
4.4
29.0
2.0
5.9
15.7
5.4
25.3
-.4
17.2
4.5
4.0
34.0
3.3
5.0
20.6
5.0
20.6
7.6
2.3
7.1
3.6
17.5
2.2
-.4
12.5
3.2
13.2
10.7
-12.1
9.0
5.7
331.2
402.3
409.1
382.2
418.4
428.0
354.2
410.2
436.7
400.2
383.3
472.8
Financial sectors
31 Total net borrowing by financial sectors
By instrument
32 U.S. government related
33 Sponsored credit agency securities
34 Mortgage pool securities
^
36 Private financial sectors
37 Corporate bonds
38 Mortgages
39 Bank loans n.e.c
40 Open market paper
41 Loans from Federal Home Loan Banks
By sector
42 Sponsored credit agencies
43 Mortgage pools
44 Private financial sectors
45 Commercial banks
46 Bank affiliates
47 Savings and loan associations
48 Finance companies
49 REITs
48.8
75.0
80.7
61.3
80.7
68.8
57.6
65.0
85.8
75.5
93.5
44.2
21.9
7.0
16.1
-1.2
26.9
10.1
3.1
-.3
9.6
4.3
36.7
23.1
13.6
47.3
24.3
23.1
43.6
24.4
19.2
45.1
30.1
15.0
62.6
13.1
49.5
47.3
27.1
20.2
39.8
21.7
18.1
42.5
26.9
15.6
47.8
33.3
14.5
59.3
21.4
37.9
65.9
4.7
61.2
38.3
7.5
.9
2.8
14.6
12.5
33.4
7.8
-1.2
-.4
18.0
9.2
17.7
7.1
-.9
-.4
4.8
7.1
35.6
-.8
-2.9
2.2
20.9
16.2
6.2
2.3
1.8
3.2
-1.8
.8
10.3
9.9
-5.3
.1
-.1
5.8
25.2
4.4
3.5
-.9
9.7
8.5
43.4
-2.1
-2.3
3.7
24.8
19.3
27.8
.4
-3.5
.7
17.0
13.2
34.2
-3.3
1.9
6.0
16.0
13.8
-21.8
7.9
1.6
.5
-19.6
-12.1
5.8
16.1
26.9
1.1
2.0
9.9
16.9
-2.5
23.1
13.6
38.3
1.3
7.2
14.3
18.1
-1.4
24.3
23.1
33.4
1.6
6.5
11.4
16.6
-1.3
24.4
19.2
17.7
.5
6.9
6.6
6.3
-2.2
30.1
15.0
35.6
.4
8.3
13.1
14.1
.2
13.1
49.5
6.2
1.2
1.9
-1.7
5.3
.1
27.1
20.2
10.3
.8
5.8
.1
6.0
-2.0
21.7
18.1
25.2
.3
8.0
13.2
6.5
-2.5
26.9
15.6
43.4
.2
6.9
19.2
17.3
.2
33.3
14.5
27.8
.5
9.7
6.9
11.0
.2
21.4
37.9
34.2
.7
9.7
16.6
7.7
.1
4.7
61.2
-21.8
1.7
-5.8
-19.9
2.9
.1
475.2
135.1
41.0
33.0
137.7
13.0
69.0
7.2
39.2
522.5
124.5
35.1
26.0
134.3
29.4
56.4
56.2
60.7
475.7
140.7
30.6
30.9
96.2
21.2
57.6
51.8
46.6
476.8
159.6
52.7
12.2
92.8
14.4
82.9
32.8
29.3
516.9
288.4
66.3
56.3
77.1
14.4
26.0
-20.6
9.1
-17.0
6.5
-23.5
-23.8
1.0
-.7
23.5
14.5
9.0
7.0
2.2
-.2
45.6
24.7
20.8
15.8
2.2
2.9
All sectors
50 Total net borrowing
51 U.S. government securities
52 State and local obligations
53 Corporate and foreign bonds
54 Mortgages
55 Consumer credit
56 Bank loans n.e.c
57 Open market paper
58 Other loans
379.9
79.9
21.9
36.1
129.9
40.2
29.5
15.0
27.4
477.4
90.5
28.4
31.8
151.0
48.8
59.0
26.4
41.5
489.7
84.8
29.8
34.2
162.4
45.4
51.0
40.3
41.8
443.5
122.9
35.9
41.1
134.0
4.9
46.5
21.6
36.6
499.1
132.6
32.9
28.5
115.2
25.3
57.0
54.0
53.7
496.9
224.0
59.5
34.2
85.0
14.4
54.4
6.1
19.2
411.8
110.7
30.7
49.3
130.4
-3.3
24.0
35.9
34.1
External corporate equity funds raised in U.S.
59 Total new share issues
60 Mutual funds
61 All other
Nonfinancial corporations
62
63
Financial corporations
64
Foreign shares purchased in U.S
6.S
.9
5.6
2.7
2.5
.4
1.9
-.1
1.9
-.1
2.5
-.5
-3.8
.1
-3.9
-7.8
3.2
.8
22.1
5.0
17.1
12.9
2.1
2.1
-2.9
7.7
-10.6
-11.5
.9
*
34.5
19.6
14.9
11.4
2.2
1.3
16.3
5.5
10.8
6.9
1.9
1.9
27.9
4.5
23.4
18.8
2.3
2.2
11.2
8.9
2.3
.9
.8
.7
Flow of Funds
1.58
A45
DIRECT AND INDIRECT SOURCES OF FUNDS TO CREDIT MARKETS
Billions of dollars, except as noted; half-yearly data are at seasonally adjusted annual rates
1980
Transaction category, or sector
1 Total funds advanced in credit markets to domestic
nonfinancial sectors
By public agencies and foreign
? Total net advances
3 U.S. government securities
4 Residential mortgages
5 FHLB advances to savings and loans
6 Other loans and securities
1977
1978
1979
1980
1981
1982
1981
1982
HI
H2
HI
H2
HI
H2
317.7
368.6
388.8
355.0
391.1
412.7
325.1
384.9
402.7
379.6
365.9
459.6
79.2
34.9
20.0
4.3
20.1
101.9
36.1
25.7
12.5
27.6
74.6
-6.3
35.8
9.2
35.9
95.8
15.7
31.7
7.1
41.3
95.9
17.2
23.4
16.2
39.1
110.9
17.7
61.1
.8
31.4
104.6
20.5
34.9
5.8
43.4
87.0
10.9
28.5
8.5
39.1
98.7
15.9
21.4
19.3
42.1
93.2
18.5
25.5
13.2
36.0
92.2
.2
47.4
13.8
30.9
129.6
35.2
74.7
-12.1
31.8
7
8
9
10
Total advanced, by sector
U.S. government
Sponsored credit agencies
Monetary authorities
Foreign
10.0
22.4
7.1
39.6
17.1
39.9
7.0
38.0
19.0
52.4
7.7
-4.6
23.7
44.4
4.5
23.2
24.2
46.0
9.2
16.6
19.4
63.5
9.8
18.2
24.6
45.2
14.9
19.9
22.8
43.7
-5.9
26.5
27.1
44.3
-3.7
30.9
21.2
47.7
22.1
2.2
14.0
60.4
-6.3
24.1
24.9
66.6
25.9
12.3
11
12
Agency and foreign borrowing not in line 1
Sponsored credit agencies & mortgage pools
Foreign
21.9
13.5
36.7
33.8
47.3
20.2
43.6
27.2
45.1
27.3
62.6
15.3
47.3
29.0
39.8
25.3
42.5
34.0
47.8
20.6
59.3
17.5
65.9
13.2
Private domestic funds advanced
13 Total net advances
14 U.S. government securities
15 State and local obligations
16 Corporate and foreign bonds
17 Residential mortgages
18 Other mortgages and loans
19 LESS: Federal Home Loan Bank advances
273.9
45.1
21.9
22.2
81.4
107.6
4.3
337.1
54.3
28.4
22.4
95.5
149.1
12.5
381.8
91.1
29.8
23.7
92.0
154.3
9.2
329.9
107.2
35.9
25.8
73.7
94.4
7.1
367.6
115.4
32.9
20.6
59.7
155.3
16.2
379.7
206.3
59.5
21.2
-1.1
94.6
.8
296.9
90.2
30.7
31.6
69.6
80.6
5.8
362.9
124.2
41.0
20.1
77.8
108.3
8.5
380.5
108.5
35.1
18.6
78.8
158.7
19.3
354.7
122.3
30.6
22.7
40.5
151.8
13.2
350.4
159.4
52.7
15.3
136.7
13.8
409.1
253.2
66.3
42.4
-17.5
52.4
-12.1
Private financial intermediation
20 Credit market funds advanced by private financial institutions
21 Commercial banking
22 Savings institutions
23 Insurance and pension funds
24 Other finance
261.7
87.6
81.6
69.0
23.5
302.9
128.7
73.6
75.0
25.6
292.2
121.1
55.5
66.4
49.2
257.9
99.7
54.1
74.4
29.8
301.3
103.5
24.6
75.8
97.4
262.5
107.8
24.0
88.6
42.1
245.4
64.7
34.9
84.3
61.5
270.4
134.8
73.2
64.4
-1.9
326.3
107.8
43.9
75.8
98.8
276.3
99.2
5.3
75.8
95.9
278.7
122.5
29.8
87.2
39.2
246.3
93.1
18.2
90.0
44.9
25 Sources of funds
26 Private domestic deposits and RP's
27 Credit market borrowing
261.7
138.9
26.9
302.9
141.1
38.3
292.2
142.5
33.4
257.9
167.8
17.7
301.3
211.2
35.6
262.5
170.4
6.2
245.4
162.5
10.3
270.4
173.1
25.2
326.3
212.0
43.4
276.3
210.3
27.8
278.7
161.1
34.2
246.3
179.6
-21.8
96.0
1.2
4.3
51.4
39.1
123.5
6.3
6.8
62.2
48.3
116.4
25.6
.4
49.1
41.3
72.4
-23.0
-2.6
65.4
32.6
54.6
-8.8
-1.1
70.8
-6.4
85.9
-28.6
6.1
78.1
30.4
72.7
-20.0
-6.1
70.3
28.6
72.1
-26.0
1.0
60.5
36.6
70.9
-.7
6.0
66.0
-.4
38.2
-16.8
-8.2
75.6
-12.3
83.4
-18.3
-5.1
77.3
29.4
88.4
-39.0
17.2
78.8
31.4
Private domestic nonfinancial investors
33 Direct lending in credit markets
34 U.S. government securities
35 State and local obligations
36 Corporate and foreign bonds
37 Open-market paper
38 Other
39.0
24.6
-.8
-5.1
9.6
10.7
72.5
36.3
3.6
-2.9
15.6
19.9
122.9
61.4
9.4
10.2
12.1
29.8
89.7
38.3
12.6
9.3
-3.4
32.9
101.9
50.4
20.3
-7.9
3.5
35.6
123.5
70.6
41.3
-8.3
-2.3
22.3
61.7
23.3
6.2
7.8
-8.1
32.5
117.7
53.3
18.9
10.8
1.4
33.3
97.5
43.0
22.8
-9.2
-1.4
42.3
106.2
57.7
17.8
-6.6
8.4
29.0
105.9
59.4
40.8
-26.6
7.8
24.5
141.0
81.8
41.7
10.0
-12.5
20.0
39 Deposits and currency
40 Currency
41 Checkable deposits
42 Small time and savings accounts
43 Money market fund shares
44 Large time deposits
45 Security RPs
46 Deposits in foreign countries
148.5
8.3
17.2
93.5
.2
25.8
2.2
1.3
152.3
9.3
16.3
63.7
6.9
46.6
7.5
2.0
151.9
7.9
19.2
61.0
34.4
21.2
6.6
1.5
179.2
10.3
4.2
79.5
29.2
48.3
6.5
1.1
221.0
9.5
18.3
46.6
107.5
36.3
2.5
.3
176.5
8.4
17.0
122.7
24.7
2.1
3.8
-2.3
172.4
9.3
-2.5
73.4
61.9
24.4
5.3
.6
186.1
11.3
11.0
85.7
-3.4
72.1
7.8
1.7
218.6
5.8
26.5
26.9
104.1
46.8
7.7
.8
223.4
13.2
10.1
66.3
110.8
25.7
-2.6
-.2
161.1
2.0
9.2
77.7
39.4
33.7
1.1
-2.0
191.8
14.8
24.8
167.6
10.1
-29.5
6.6
-2.6
47 Total of credit market instruments, deposits and
currency
28
29
30
31
32
Other sources
Foreign funds
Treasury balances
Insurance and pension reserves
Other, net
*
187.5
224.9
274.8
269.0
322.8
300.0
234.1
303.8
316.1
329.6
267.0
332.9
Public holdings as percent of total
Private financial intermediation (in percent)
Total foreign funds
23.9
95.6
40.8
25.3
89.9
44.3
18.2
76.5
21.0
25.1
78.2
.2
22.9
82.0
7.8
25.9
69.1
-10.4
29.5
82.7
21.2
74.5
.5
22.6
85.8
30.3
23.3
77.9
-14.6
24.1
79.5
5.9
27.4
60.2
-26.7
MEMO: Corporate equities not included above
51 Total net issues
52 Mutual fund shares
53 Other equities
6.5
.9
5.6
1.9
-.1
1.9
-3.8
.1
-3.9
22.1
5.0
17.1
-2.9
7.7
-10.6
34.5
19.6
14.9
16.3
5.5
10.8
27.9
4.5
23.4
11.2
8.9
2.3
-17.0
6.5
-23.5
23.5
14.5
9.0
45.6
24.7
20.8
54 Acquisitions by financial institutions
55 Other net purchases
7.4
-.8
4.6
-2.7
10.4
-14.2
14.6
7.5
22.9
-25.8
31.4
3.2
8.6
7.7
20.7
7.2
25.3
-14.1
20.5
-37.5
21.1
2.4
41.6
4.0
48
49
50
NOTES BY LINE NUMBER.
1.
2.
6.
II.
13.
18.
26.
27.
29.
30.
31.
Line 1 of table 1.58.
Sum of lines 3-6 or 7-10.
Includes farm and commercial mortgages.
Credit market funds raised by federally sponsored credit agencies, and net
issues of federally related mortgage pool securities.
Line 1 less line 2 plus line 11 and 12. Also line 20 less line 27 plus line 33. Also
sum of lines 28 and 47 less lines 40 and 46.
Includes farm and commercial mortgages.
Line 39 less lines 40 and 46.
Excludes equity issues and investment company shares. Includes line 19.
Foreign deposits at commercial banks, bank borrowings from foreign
branches, and liabilities of foreign banking agencies to foreign affiliates.
Demand deposits at commercial banks.
Excludes net investment of these reserves in corporate equities.
*
32. Mainly retained earnings and net miscellaneous liabilities.
33. Line 12 less line 20 plus line 27.
34-38. Lines 14-18 less amounts acquired by private finance. Line 38 includes
mortgages.
40. Mainly an offset to line 9.
47. Lines 33 plus 39, or line 13 less line 28 plus 40 and 46.
48. Line 2/line 1.
49. Line 20/line 13.
50. Sum of lines 10 and 29.
51. 53. Includes issues by financial institutions.
NOTE. Full statements for sectors and transaction types in flows and in amounts
outstanding, may be obtained from Flow of Funds Section, Division of Research
and Statistics, Board of Governors of the Federal Reserve System, Washington,
D.C. 20551.
A46
2.10
Domestic Nonfinancial Statistics • June 1983
NONFINANCIAL BUSINESS ACTIVITY
Selected Measures
1967 = 100; monthly and quarterly data are seasonally adjusted. Exceptions noted.
1982
Measure
1980
1981
1983
1982
Oct.
Sept.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
May
1 Industrial production1
147.0
151.0
138.6
137.3
135.7
134.9
135.2
137.4
138.1
139.9
142.7
144.3
Market groupings
Products, total
Final, total
Consumer goods
Equipment
Intermediate
Materials
146.7
145.3
145.4
145.2
151.9
147.6
150.6
149.5
147.9
151.5
154.4
151,6
141.8
141.5
142.6
139.8
143.3
133.7
140.8
140.0
143.4
135.2
143.7
132.0
139.3
138.7
142.2
134.0
141.6
130.0
139.0
138.3
141.3
134.2
141.8
128.4
139.9
139.5
142.0
136.1
141.5
127.8
140.9
140.1
143.6
135.3
143.7
132.0
140.3
138.9
143.4
132.7
145.3
134.9
141.7
140.0
144.5
133.9
147.9
137.2
144.3
142.6
146.8
136.8
150.7
140.1
146.0
144.3
148.1
139.0
152.6
141.5
146.7
150.4
137.6
137.1
135.0
134.0
134.5
136.7
138.2
140.3
143.2
145.0
79.1
80.0
78.5
79.9
69.8
68.9
69.2
67.7
68.0
66.6
67.4
65.7
67.5
65.2
68.5
67.3
69.1
68.6
69.9
69.7
71.3
71.0
72.0
71.7
2
i
4
5
6
7
Industry groupings
8 Manufacturing
Capacity utilization (percent)1'2
9 Manufacturing
10 Industrial materials industries
3
11 Construction contracts (1977 = 100)
107.0
111.0
111.0
117.0
105.0
122.0
131.0
127.0
119.0
131.0
129.0
n.a.
12
13
14
15
16
17
18
19
20
21
Nonagricultural employment, total4
Goods-producing, total
Manufacturing, total
Manufacturing, production-worker . . .
Service-producing
Personal income, total
Wages and salary disbursements
Manufacturing
Disposable personal income5
Retail sales"
137.4
110.1
104.3
99.3
152.4
342.9
317.6
264.3
332.9
303.8
138.5
109.4'
103.7
98.0
154.4
383.5
349.9
288.1
370.3
330.6
136.2
102.6'
96.9
89.4'
154.7
407.9
365.5
285.3
396.7
326.0
135.6'
101.0
95.4'
87.7'
154.6'
412.3
367.7
284.5
402.0
343.5
135.2'
99.9'
94.4'
86.4'
154.5'
414.2
368.0
281.3
403.7
347.4
134.9
99.2'
93.7'
85.6'
154.5
417.1
368.2
280.0
406.8
353.4
134.7'
98.9'
93.6'
ss.e'
154.4'
418.3
370.0
279.3
407.4
353.3
135.1
99.5'
93.8'
85.9'
154.6'
419.3
373.8
283.9
409.5
352.7
134.9
98.9'
93.8'
86.(K
154.6'
419.7
373.3
285.5
409.2
348.3
ns.O'
98.8'
93.9'
86.1
154.8'
422.0
375.4
287.5
411.6
356.4
135.4'
99.3'
94.5
86.9
155.2'
425.3
378.4
291.3
415.7
362.5
136.0
100.2
95.0
87.7
155.6
n.a.
n.a.
n.a.
370.1
22
23
Prices7
Consumer
Producer finished goods
246.8
247.0
272.4
269.8
289.1
280.6
293.3
281.2
294.1
284.1
293.6
284.9
292.4
285.5'
292.6
283.6
293.2
283.7
293.4
283.4
295.5
283.0
n.a.
n.a.
1. The industrial production and capacity utilization series have been revised
back to January 1979.
2. Ratios of indexes of production to indexes of capacity. Based on data from
Federal Reserve, McGraw-Hill Economics Department, and Department of
Commerce.
3. Index of dollar value of total construction contracts, including residential,
nonresidential and heavy engineering, from McGraw-Hill Information Systems
Company, F. W. Dodge Division.
4. Based on data in Employment and Earnings (U.S. Department of Labor).
Series covers employees only, excluding personnel in the Armed Forces.
5. Based on data in Survey of Current Business (U.S. Department of Commerce).
2.11
6. Based on Bureau of Census data published in Survey of Current Business.
1. Data without seasonal adjustment, as published in Monthly Labor Review.
Seasonally adjusted data for changes in the price indexes may be obtained from
the Bureau of Labor Statistics, U.S. Department of Labor.
NOTE. Basic data (not index numbers) for series mentioned in notes 4, 5, and 6,
and indexes for series mentioned in notes 3 and 7 may also be found in the Survey
of Current Business.
Figures for industrial production for the last two months are preliminary and
estimated, respectively.
OUTPUT, CAPACITY, AND CAPACITY UTILIZATION
Seasonally adjusted
1982
1983
1982
1983
1982
1983
denes
Q2
Q3
Q4
Ql
Output (1967 = 100)
Q2
Q3
Q4
Ql
Capacity (percent of 1967 output)
Q2
Q3
Q4
Ql
Utilization rate (percent)
1
2
3
Manufacturing
Primary processing
Advanced processing
138.1
137.7
134.5
138.4
196.4
197.7
198.9
200.1
70.3
69.7
67.6
69.2
132.3
141.2
132.4
140.5
129.3
137.3
136.9
139.7
199.5
194.9
200.4
196.2
201.3
197.6
202.3
199.0
66.3
72.5
66.1
71.6
64.2
69.5
67.7
70.2
4
Materials
134.7
132.6
128.7
134.7
193.7
194.6
195.5
196.6
69.6
68.1
65.8
68.5
Durable goods
Metal materials
Nondurable goods
Textile, paper, and chemical
Textile
Paper
Chemical
Energy materials
127.1
77.0
156.8
160.5
101.8
142.0
194.0
125.5
124.7
73.0
155.1
158.4
102.0
145.9
188.5
123.8
117.1
66.5
157.0
160.8
103.0
147.6
191.9
121.5
125.1
78.3
163.5
169.1
107.2
149.7
204.3
122.2
197.3
142.4
216.1
227.3
142.4
164.6
289.6
157.0
198.3
142.3
217.4
228.8
142.8
165.4
291.9
157.6
199.2
142.4
218.9
230.5
143.1
166.3
294.3
158.2
200.2
142.6
220.2
231.9
143.6
167.0
296.7
158.8
64.4
54.1
72.6
70.6
71.5
86.3
67.0
79.9
62.9
51.3
71.3
69.2
71.5
88.2
64.6
78.5
58.8
46.7
71.8
69.8
72.0
88.7
65.2
76.8
62.5
54.9
74.3
72.9
74.7
89.6
68.8
76.9
5
6
7
8
9
10
11
12
Labor Market
2.11
A47
Continued
Previous cycle1
High
Low
Latest cycle2
1982
Low
May
High
1982
Sept.
1983
Nov.
Oct.
Dec.
Jan.
Feb.
Mar.
Apr.
May
Capacity utilization rate (percent)
13 Manufacturing
88.0
69.0
87.2
74.9
70.2
69.2
68.0
67.4
67.5
68.5
69.1
69.9
71.3
72.0
14
15
93.8
85.5
68.2
69.4
90.1
86.2
71.0
77.2
66.1
72.5
66.4
70.7
65.0
69.6
63.9
69.2
63.7
69.5
66.0
70.0
67.7
69.9
68.8
70.5
70.6
71.6
71.2
72.4
16 Materials
17 Durable goods
18
Metal materials
92.6
91.5
98.3
69.4
63.6
68.6
88.8
88.4
96.0
73.8
68.2
59.6
69.4
64.2
53.9
67.7
61.9
51.9
66.6
59.6
48.6
65.7
58.4
45.5
65.2
58.4
46.0
67.3
60.8
52.4
68.6
62.6
55.2
69.7
64.1
57.2
71.0
65.8
58.0
71.7
66.7
n.a.
19
20
94.5
67.2
91.6
77.5
72.5
72.8
72.5
71.9
71.0
72.7
74.5
75.6
76.8
77.6
21
22
23
Nondurable goods
Textile, paper, and
chemical
Textile
Paper
Chemical
95.1
92.6
99.4
95.5
65.3
57.9
72.4
64.2
92.2
90.6
97.7
91.3
75.3
80.9
89.3
70.7
70.6
71.5
86.1
66.9
70.7
72.3
89.8
66.2
70.3
73.0
89.7
65.4
69.9
71.6
90.0
65.1
69.3
71.3
86.5
65.1
70.8
73.0
89.9
66.0
73.3
74.1
89.9
69.5
74.7
77.0
89.1
71.0
76.2
78.3
89.4
72.8
77.2
n.a.
n.a.
n.a.
24
Energy materials
94.6
84.8
88.3
82.7
79.9
76.6
77.6
76.8
76.0
77.5
76.7
76.6
76.8
76.6
Primary processing
Advanced processing . . . .
1. Monthly high 1973; monthly low 1975.
2.12
2. Preliminary; monthly highs December 1978 through January 1980; monthly
lows July 1980 through October 1980.
LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT
Thousands of persons; monthly data are seasonally adjusted. Exceptions noted.
1982
Category
1980
1981
1983
1982
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
May
HOUSEHOLD SURVEY DATA
1 Noninstitutional population1
169,847
172,272
174,451
175,238
175,381
175,543
175,693
175,850
175,996'
176,151
2 Labor force (including Armed Forces)1
3 Civilian labor force
Employment
4
Nonagricultural industries2
5
Agriculture
Unemployment
6
Number
7
Rate (percent of civilian labor force)...
8 Not in labor force
109,042
106,940
110,812
108,670
112,384
110,204
113,222
111,042
113,311
111,129
112,737
110,548
112,741
110,553
112,678
110,484
112,988
110,786
112,947
110,749
95,938
3,364
97,030
3,368
96,125
3,401
95,670
3,466
95,682
3,411
95,691
3,412
95,670
3,393
95,729
3,375
96,088'
3,371
96,190
3,367
7,637
7.1
60,805
8,273
7.6
61,460
10,678
9.7
62,067
11,906
10.7
62,016
12,036
10.8
62,070
11,446
10.4
62,806
11,490
10.4
62,952
11,381
10.3
63,172
11,328
10.2
63,008
11,192
10.1
63,204
Nonagricultural payroll employment 3
90,406
91,105
89,619
88,785'
88,665'
88,886'
88,745'
88,814'
89,087'
89,461
Manufacturing
Mining
Contract construction
Transportation and public utilities
Trade
Finance
Service
Government
20,285
1,020
4,399
5,143
20,386
5,168
17,901
16,249
20,173
1,132
4,176
5,157
20,551
5,301
18,592
16,024
18,849
1,122
3,912
5,057
20,547
5,350
19,000
15,784
18,222'
1,066'
3,843'
5,019'
20,320'
5,356'
19,187'
15,772'
1
18,193'
1,053'
3,815'
5,008'
20,256'
5,367'
19,215'
15,758'
18,244'
1,037'
3,905'
4,980'
20,355'
5,374'
19,238'
15,753'
18,245'
1,014'
3,790'
4,965'
20,343'
5,384'
19,262'
15,742'
18,267'
1,006'
3,757'
4,963'
20,35(K
5,391'
19,356'
15,724'
18,373'
997'
3,785'
4,988'
20,317'
5,417'
19,484'
15,726'
18,477
1,004
3,866
4,994
20,344
5,418
19.603
15,755
ESTABLISHMENT SURVEY DATA
9
10
11
12
13
14
15
16
17
1. Persons 16 years of age and over. Monthly figures, which are based on
sample data, relate to the calendar week that contains the 12th day; annual data
are averages of monthly figures. By definition, seasonality does not exist in
population figures. Based on data from Employment and Earnings (U.S. Department of Labor).
2. Includes self-employed, unpaid family, and domestic service workers.
3. Data include all full- and part-time employees who worked during, or
received pay for, the pay period that includes the 12th day of the month, and
exclude proprietors, self-employed persons, domestic servants, unpaid family
workers, and members of the Armed Forces. Data are adjusted to the March 1983
benchmark and only seasonally adjusted data are available at this time. Based on
data from Employment and Earnings (U.S. Department of Labor).
A48
2.13
Domestic Nonfinancial Statistics • June 1983
INDUSTRIAL PRODUCTION
Indexes and Gross Value
Monthly data are seasonally adjusted
O n upine
g
1967
proportion
1982
1982
avg.
May
June
July
Aug.
1983
Sept.
Oct.
Nov.
Dec.
Jan.
Feb/
Mar.
Apr .p
Mayf
Index (1967 = 100)
MAJOR MARKET
100.00
138.6
139.2
138.7
138.8
138.4
137.3
135.7
134.9
135.2
137.4
138.1
139.9
142.7
144.3
60.71
47.82
27.68
20.14
12.89
39.29
141.8
141.5
142.6
139.8
143.3
133.7
142.3
142.2
143.6
140.4
142.6
134.3
142.1
142.1
144.8
138.4
141.9
133.5
142.6
142.5
145.8
138.0
142.8
133.0
142.0
141.2
144.1
137.3
144.7
132.8
140.8
140.0
143.4
135.2
143.7
132.0
139.3
138.7
142.2
134.0
141.6
130.0
139.0
138.3
141.3
134.2
141.8
128.4
139.9
139.5
142.0
136.1
141.5
127.8
140.9
140.1
143.6
135.3
143.7
132.0
140.3
138.9
143.4
132.7
145.3
134.9
141.7
140.0
144.5
133.9
147.9
137.2
144.3
142.6
146.8
136.8
150.7
140.1
146.0
144.3
148.1
139.0
152.6
141.5
7.89
2.83
2.03
1.90
.80
5.06
1.40
1.33
1.07
2.59
129.2
129.5
99.0
86.6
206.9
129.1
102.6
104.6
149.7
135.0
132.6
138.9
111.8
96.1
207.6
129.1
100.5
101.5
145.9
137.7
134.6
143.0
117.1
101.9
208.6
129.9
106.4
108.8
149.0
134.9
137.3
149.7
127.7
114.6
205.4
130.4
102.7
106.1
151.4
136.7
132.9
135.5
107.1
93.3
207.6
131.4
104.5
108.6
152.5
137.2
131.3
135.5
105.8
94.3
210.7
128.9
99.4
104.1
153.3
134.9
126.5
123.6
89.6
79.5
210.0
128.1
106.1
110.5
151.9
130.1
124.6
120.7
86.9
77.7
206.6
126.8
104.8
108.4
151.4
128.6
125.9
128.7
99.0
87.9
204.0
124.3
94.2
98.3
150.8
129.8
131.6
136.2
107.0
97.1
210.2
129.1
109.5
112.9
149.0
131.4
134.4
144.3
120.8
107.3
203.9
128.8
105.8
108.8
156.7
129.7
136.0
142.3
116.4
99.9
208.3
132.5
105.0
108.5
167.3
133.1
139.1
144.7
117.8
102.7
213.0
135.9
107.1
110.8
178.1
134.2
142.4
150.3
124.8
107.4
215.0
137.9
110.8
147.9
148.8
149.1
148.6
148.2
148.5
147.9
148.4
148.3
147.0
147.8
149.9
150.4
159.0
149.9
169.5
216.6
126.7
153.6
173.7
159.9
150.9
170.4
219.8
126.7
152.8
171.1
159.7
149.9
171.2
222.3
128.1
151.4
167.7
159.4
149.6
170.8
222.4
129.4
149.3
169.7
158.8
148.6
170.7
221.7
128.2
150.6
169.5
159.1
150.2
169.5
220.0
125.3
151.1
169.1
158.1
149.0
168.7
218.9
125.1
150.2
171.5
158.8
149.5
169.6
220.9
128.3
148.4
169.3
158.6
150.9
167.6
222.6
127.1
142.2
164.1
157.4
149.5
166.5
220.9
127.9
140.2
162.9
158.5
149.0
169.4
225.6
128.1
143.3
166.1
160.3
160.8
171.7
226.2
128.9
148.4
172.4
26
19.79 148.0
4 29
15.50 159.0
8.33 149.7
7.17 169.7
2.63 219.9
1.92 127.7
2.62 150.2
1.45 170.8
Equipment
27 Business
28 Industrial
29
Building and mining
30
Manufacturing
31
Power
12.63
6.77
1.44
3.85
1.47
157.9
134.9
214.2
107.2
129.9
159.9
138.9
224.4
109.7
131.5
156.7
134.0
209.0
107.5
129.9
154.9
131.3
200.4
106.0
129.6
153.9
128.4
190.8
104.4
130.1
150.5
123.8
182.1
101.6
124.7
147.1
118.3
169.3
98.0
121.0
146.4
117.2
165.7
97.5
121.0
148.1
117.9
171.9
97.0
119.7
146.6
118.4
173.8
97.6
118.3
142.7
113.7
153.6
97.9
116.0
143.9
113.2
145.3
99.7
116.8
147.2
114.5
143.2
102.4
117.8
149.7
117.6
153.8
104.0
117.9
184.4
253.5
103.9
80.5
184.1
247.7
110.9
85.8
183.0
247.5
108.3
84.1
182.2
248.8
106.3
76.9
183.3
253.5
102.0
75.8
181.4
254.0
95.5
76.1
180.5
253.5
93.2
76.8
180.2
254.8
92.3
70.7
183.0
258.6
96.2
65.1
179.2
254.9
90.8
66.0
176.1
251.2
88.2
63.4
179.4
255.7
90.8
63.4
184.9
263.2
92.5
70.4
186.8
265.0
93.8
35
5.86
3.26
1.93
.67
36 Defense and space
7.51
109.4
107.7
107.6
109.5
109.5
109.5
111.9
113.6
115.9
116.4
116.1
117.1
119.4
120.9
Intermediate products
37 Construction supplies
38
39
6.42
6.47
1.14
124.3
162.1
181.1
122.2
162.8
180.3
123.1
160.6
178.3
124.1
161.4
179.8
127.1
162.1
178.1
125.5
161.8
179.2
122.5
160.5
180.4
123.4
160.1
182.4
123.0
159.8
182.4
127.0
160.3
180.6
129.7
160.9
178.6
133.7
162.0
180.3
137.0
164.4
182.2
139.6
20.35
4.58
5.44
10.34
5.57
125.0
95.3
166.8
116.2
79.9
126.6
98.9
170.0
116.1
79.4
126.6
103.1
168.3
115.1
77.4
126.0
103.8
166.1
114.8
75.7
125.1
101.0
164.1
115.4
76.1
123.0
97.1
158.3
115.8
77.7
118.5
91.4
155.4
111.1
73.0
116.4
90.0
155.1
107.7
69.1
116.5
91.1
155.3
107.4
68.7
121.5
96.2
157.5
113.8
78.1
125.3
101.6
158.8
118.2
82.4
128.4
103.7
162.5
121.4
85.1
132.2
106.2
167.0
125.4
86.5
134.1
108.5
168.9
127.1
1 Total index
2 Products
3 Final products
4
Consumer goods
5
Equipment
6 Intermediate products
7 Materials
Consumer goods
8 Durable consumer goods
9 Automotive products
10
Autos and utility vehicles
11
Autos
12
Auto parts and allied goods
13 Home goods
14
Appliances, A/C, and TV
15
16
17
Miscellaneous home goods
18 Nondurable consumer goods
19
20 Consumer staples
21
Consumer foods and tobacco
22
Nonfood staples
23
Consumer chemical products . . . .
">4
32
33
34
Commercial transit, farm
Commercial
Transit
Materials
40 Durable goods materials
41 Durable consumer parts
42 Equipment parts
43 Durable materials n.e.c
44
45 Nondurable goods materials
46 Textile, paper, and chemical
materials
47
48
49
50
51
52 Energy materials
53
54
Supplementary groups
55 Home goods and clothing
56 Energy, total
57
58 Materials
135.6
10.47
157.5
156.6
153.5
152.3
154.5
158.5
158.2
157.3
155.6
159.7
164.0
166.9
169.9
171.8
7.62
1.85
1.62
4.15
1.70
1.14
161.1
102.2
145.6
193.5
161.4
127.9
160.4
101.8
141.8
193.9
157.2
130.6
156.7
99.1
140.7
188.7
158.5
124.8
155.3
99.6
142.1
185.4
158.1
123.4
157.7
103.2
146.6
186.5
162.8
120.1
162.2
103.3
148.9
193.7
167.3
121.1
161.5
104.4
148.9
192.0
164.9
125.5
161.0
102.5
149.7
191.6
160.8
127.4
160.0
102.1
144.1
192.0
155.2
127.2
163.7
104.7
150.1
195.4
162.1
129.6
170.0
106.4
150.1
206.2
159.6
130.5
173.5
110.6
149.0
211.2
163.4
127.8
177.4
112.6
149.9
217.2
163.4
129.2
180.0
8.48
4.65
3.82
125.1
116.0
136.3
125.4
116.9
135.7
125.4
116.6
136.0
126.0
117.2
136.7
124.5
113.8
137.4
121.0
111.1
133.0
122.6
114.4
132.6
121.4
113.7
130.8
120.4
113.5
128.9
123.0
116.5
130.8
121.8
115.4
129.6
121.7
114.2
130.8
122.2
113.5
132.8
122.1
9.35
12.23
3.76
8.48
119.6
135.7
159.6
125.1
119.5
136.5
161.7
125.4
120.2
136.2
160.5
125.4
121.4
136.4
160.0
126.0
121.3
134.8
158.0
124.5
120.1
132.7
159.3
121.0
119.9
134.1
160.0
122.6
119.6
133.3
160.0
121.4
118.2
132.2
158.7
120.4
120.8
132.4
153.8
123.0
119.9
131.0
151.9
121.8
121.9
131.8
154.5
121.7
125.1
133.4
158.6
122.2
126.5
133.5
122.1
Output
2.13
A49
Continued
Grouping
SIC
code
1967
proportion
1982
1982
avg.
May
June
July
Aug.
1983
Sept.
Oct.
Nov.
Dec.
Jan.
Feb/
Mar.
Apr.P
Mayf
Index (1967 = 100)
MAJOR INDUSTRY
12.05
6.36
5.69
3.88
87.95
35.97
51.98
146.3
126.1
168.7
190.5
137.6
156.2
124.7
148.8
128.9
170.9
193.4
137.9
155.0
126.1
145.2
123.5
169.4
191.6
137.7
155.3
125.5
142.6
120.1
167.7
189.2
138.1
155.7
125.9
141.3
116.9
168.5
189.9
138.0
156.9
124.9
139.7
114.7
167.5
188.2
137.1
156.7
123.5
140.4
115.9
167.8
188.4
135.0
156.2
120.3
140.4
116.8
166.7
188.3
134.0
155.3
119.3
140.1
118.4
164.2
185.6
134.5
155.6
119.9
141.3
121.9
163.1
184.4
136.7
157.4
122.5
141.7
114.5
171.9
191.6
138.0
157.5
124.5
136.6
112.3
163.9
181.6
141.4
160.7
128.0
133.4
112.1
157.1
173.8
143.3
162.8
129.8
132.6
113.8
153.2
171.0
145.1
164.5
131.7
10
11.12
13
14
.51
.69
4.40
.75
82.4
142.7
131.1
112.1
90.0
149.2
132.7
114.6
71.8
144.4
129.1
106.6
58.1
140.3
127.0
103.8
53.4
135.8
123.3
105.7
55.4
127.9
121.0
106.3
63.1
143.2
119.1
108.5
70.4
134.1
120.3
111.9
74.9
129.7
122.9
111.7
81.7
144.8
124.6
112.8
71.2
135.0
117.5
108.1
74.2
133.3
114.2
108.2
81.2
130.8
112.0
117.1
133.0
113.1
8.75
.67
2.68
3.31
3.21
151.1
118.0
124.5
150.5
118.6
123.5
151.0
123.6
123.7
151.0
121.4
124.3
150.7
120.6
125.9
149.0
113.3
126.1
151.5
110.6
125.9
152.0
113.0
123.1
152.8
109.9
122.2
154.4
104.7
125.8
147.0
115.9
128.7
147.6
116.5
132.8
138.6
16 Paper and products
20
21
22
23
26
150.8
146.5
146.8
147.0
152.5
154.3
155.0
154.5
151.1
158.8
160.9
163.9
163.1
162.4
17
18
19
20
21
Printing and publishing
Chemicals and products
Petroleum products
Rubber and plastic products
Leather and products
27
28
29
30
31
4.72
7.74
1.79
2.24
.86
144.1
196.1
121.8
254.7
60.9
143.8
193.6
122.2
257.0
61.1
142.6
193.2
124.3
258.9
62.3
143.9
194.1
124.7
256.8
62.9
145.3
195.6
121.4
261.1
60.8
144.3
196.4
122.6
262.0
60.9
142.0
194.1
123.8
256.3
59.5
141.7
192.8
120.0
250.2
57.7
142.8
195.9
118.7
249.7
56.0
141.3
197.6
113.5
256.2
59.5
135.8
200.0
108.6
275.2
64.1
137.9
206.6
110.0
285.7
62.4
140.0
211.2
116.7
283.2
62.4
144.2
22
r\
74
25
Durable manufactures
Ordnance, private and government .
Lumber and products
Furniture and fixtures
Clay, glass, stone products
19.91
24
25
32
3.64
1.64
1.37
2.74
86.9
112.6
151.9
128.2
86.3
110.6
151.1
125.0
86.5
112.2
152.5
126.1
87.1
116.9
154.5
126.9
86.5
120.3
156.7
128.8
86.9
119.9
155.7
130.4
89.5
117.2
154.3
128.1
91.9
119.1
152.4
127.3
92.5
121.4
153.7
125.4
93.5
130.0
150.0
128.0
93.4
130.5
162.5
124.8
94.3
130.8
162.7
131.0
94.8
135.3
167.2
139.0
26
77
78
79
30
Primary metals
Iron and steel
Fabricated metal products
Nonelectrical machinery
Electrical machinery
33
331.2
34
35
36
6.57
4.21
5.93
9.15
8.05
75.3
61.7
114.8
149.0
169.3
75.2
62.4
115.8
150.0
170.9
72.8
58.0
115.0
147.4
170.8
72.9
58.1
115.5
147.1
170.3
72.9
57.4
114.3
147.2
169.7
73.2
56.4
112.3
144.9
167.0
69.6
54.1
107.6
140.4
165.4
63.6
47.5
107.0
139.6
165.5
63.5
46.6
107.3
139.2
165.5
73.1
59.0
107.6
138.0
169.5
79.4
64.3
112.3
137.1
170.1
86.5
71.6
115.5
138.7
174.0
87.3
73.3
115.2
142.4
176.5
116.4
144.3
179.2
37
371
9.27
4.50
104.9
109.8
110.0
119.8
111.6
124.0
112.7
127.2
107.0
116.7
105.3
113.5
100.8
103.0
100.2
101.7
103.7
108.8
106.3
113.9
110.5
124.8
114.4
130.6
114.4
131.3
117.6
137.0
372-9
38
39
4.77
2.11
1.51
100.4
161.9
137.0
100.8
163.8
141.7
99.9
164.8
136.8
99.0
165.2
134.7
97.8
165.5
133.9
97.6
161.9
132.9
98.6
157.4
129.6
98.7
155.8
129.5
98.9
155.2
128.2
99.1
154.5
131.3
97.0
151.6
130.6
99.1
152.7
136.0
98.5
152.8
135.1
99.4
155.9
136.0
1
1
->,
4
5
6
7
8
9
10
11
Mining
Metal
Coal
Oil and gas extraction
Stone and earth minerals
Nondurable manufactures
1? Foods
Tobacco products
14 Textile mill products
N
31 Transportation equipment
32 Motor vehicles and parts
33 Aerospace and miscellaneous
transportation equipment
34 Instruments
35 Miscellaneous manufactures
121.1
96.9
87.9
Gross value (billions of 1972 dollars, annual rates)
MAJOR MARKET
36
37
38
39
40
1. 1972 dollar value.
507.4
579.6
586.1
584.1
585.8
578.5
575.3
570.0
568.4
572.9
578.1
578.4
584.4
593.9
601.1
390.9
277.5
113.4
116.6
451.1
308.0
143.1
128.5
458.3
312.3
146.0
127.8
456.7
313.1
143.5
127.4
457.2
314.9
142.3
128.7
449.2
309.1
140.1
129.3
446.3
309.3
137.0
129.0
442.8
306.6
136.2
127.2
441.3
305.6
135.7
127.1
445.8
306.8
138.9
127.1
448.3
310.9
137.4
129.8
447.3
312.0
135.3
131.1
451.4
313.4
138.0
133.1
458.4
318.2
140.2
135.6
464.4
321.3
143.1
136.7
A50
2.14
Domestic Nonfinancial Statistics • June 1983
HOUSING AND CONSTRUCTION
Monthly figures are at seasonally adjusted annual rates except as noted.
1982
Aug.
Sept.
Oct.
1983
Nov.
Dec.
Jan.
Feb.'
Mar.'
Apr.
Private residential real estate activity (thousands of units)
NEW UNITS
1 Permits authorized
2 1-family
3 2-or-more-family
1,191
710
480
986
564
421
1,001'
546'
454'
928'
515'
413'
1,029^
576'
453'
1,154'
657'
497'
1,227'
738'
489'
1,326'
753'
573'
1,447'
866'
581'
1,479
835
644
1,467
859
608
1,563
836
727
4 Started
5 1-family
6 2-or-more-family
1,292
852
440
1,084
705
379
1,062
663
400
1,046
651
395
1,134
683
451
1,142
716
426
1,361
868
493
1,280
842
438
1,694
1,126
568
1,784
1,103
681
1,627
1,023
604
1,490
983
507
896
515
382
682
382
301
720
400
320
671
374
296
685
380
306
691
383
307
712
395
317
730
411
319
756
428
329
798
457
341
834
474
360
1,502
957
545
1,266
818
447
1,006
631
374
1,001
638
363
936
585
351
1,077
679
398
1,053
679
374
1,035
647
388
1,195'
782'
413'
1,140
708
432
1,139
793
346
13 Mobile homes shipped
222
241
239
234
222
224
251
243
284
283
276
<
Merchant builder activity in 1-family units
14 Number sold
15 Number for sale, end of period1
545
342
436
278
413
255
389
248
473
247
481
245
545
246
529
251
611'
259'
592
263
597
266
573
270
Price (thousands of dollars)2
Median
16 Units sold
64.7
68.8
69.3
70.1
67.7
69.7
73.5
71.7
73.5'
73.7
73.1
74.9
17
76.4
83.1
83.8
86.5
79.6
79.9
87.8
86.7
87.2'
87.1
87.0
89.2
2,974
2,418
1,991
1,860
1,910
1,990
2,150
2,260
2,580
2,460
2,710
2,750
62.1
72.7
66.1
78.0
67.7
80.4
68.9
82.0
67.3
80.0
66.9
79.3
67.7
80.4
67.8
80.6
68.1
80.0
68.2
80.3
68.9
81.1
68.9
81.3
7 Under construction, end of period1
8 1-family
9 2-or-more-family
10 Completed
11 1-family
12 2-or-more-family
Units sold
y
n a.
EXISTING UNITS (1-family)
18 Number sold
Price of units sold (thousands of dollars)2
19 Median
20 Average
Value of new construction3 (millions of dollars)
CONSTRUCTION
21 Total put in place
230,748
238,198 229,566
228,053
228,136
230,818
239,637
239,031
255,969
249,355
246,863
248,041
22 Private
23 Residential
24 Nonresidential, total
Buildings
25
Industrial
7.6
Commercial
27
Other
Public utilities and other
28
175,701
87,261
88,440
185,221 179,418
86,566 75,003
98,655 104,415
176,644
72,139
104,505
177,002
71,451
105,551
179,792
75,687
104,105
187,517
81,744
105,773
191,441
86,950
104,491
200,071
93,406
106,665
199,176
96,391
102,785
198,822
98,572
100,250
202,316
104,362
97,954
29 Public
30 Military
31 Highway
32 Conservation and development
33 Other
13,839
29,940
8,654
36,007
17,031
34,243
9,543
37,838
16,670
37,125
10,421
40,199
16,691
36,091
10,499
41,224
16,587
37,129
10,506
41,329
17,072
35,677
10,778
40,578
15,838
37,769
11,100
41,066
15,257
37,516
11,476
40,242
15,518
38,773
12,234
40,140
14,431
37,330
11,871
39,153
13,894
36,313
11,693
38,350
12,930
34,596
11,006
39,422
55,047
1,880
13,808
5,089
34,270
52,977
1,966
13,304
5,225
32,482
50,148
2,192
13,180
4,983
29,793
51,409
2,481
13,327
5,036
30,565
51,134
2,674
13,464
4,719
30,277
51,026
2,324
14,314
4,541
29,847
52,120
2,527
13,906
4,718
30,969
47,590
2,320
12,417
4,601
28,252
55,898
2,671
14,757
5,214
33,256
50,179
2,709
13,245
4,889
29,336
48,041
2,721
12,243
5,209
27,868
45,725
2,647
12,005
4,677
26,396
1. Not at annual rates.
2. Not seasonally adjusted.
3. Value of new construction data in recent periods may not be strictly
comparable with data in prior periods 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 Bureau in July 1976.
NOTE. Census Bureau estimates for all series except (a) mobile homes, which
are private, domestic shipments as reported by the Manufactured Housing
Institute and seasonally adjusted by the Census Bureau, and (b) sales and prices of
existing units, which are published by the National Association of Realtors. All
back and current figures are available from originating agency. Permit authorizations are those reported to the Census Bureau from 16,000 jurisdictions beginning
with 1978.
Prices
2.15
A51
CONSUMER AND PRODUCER PRICES
Percentage changes based on seasonally adjusted data, except as noted
Change from 12
months earlier
Change from 3 months earlier
(at annual rate)
Item
1982
1982
Apr.
1983
Apr.
June
Sept.
Dec.
Change from 1 month earlier
1983
1982
Mar.
Dec.
Index
level
Apr.
1983
(1967 1
= 100)
1983
Jan.
Feb.
Apr.
Mar.
CONSUMER PRICES2
1
All items
7 Food
3 Energy items
4 All items less food and energy
Commodities
6 Services
6.6
3.9
9.8
4.1
.5
.4
.1
.6
295.5
4.0
-3.4
8.8
6.4
10.9
2.8
3.6
4.3
5.7
3.2
6.2
7.5
9.6
9.9
11.3
.6
8.1
4.7
2.4
4.6
.8
10.2
-.3
5.4
-4.8
2.8
-25.1
4.4
5.7
3.7
.0
.3
-.2
.3
-1.0
.1
-2.5
.5
.5
.5
.0
-3.7
.4
.5
.3
.6
-.9
.2
.4
.1
.4
2.0
.4
.1
.5
291.9
410.0
284.0
240.2
334.8
3.3
3.2
-9.2
5.6
6.3
2.1
1.1
-3.3
3.5
3.4
4.6
9.8
-9.2
5.7
5.2
4.2
-7.7
30.9
4.2
3.5
5.2'
.8'
7.0'
7.9'
3.6'
-4.7'
3.6'
-34.3'
-2.3'
3.3'
.3'
.2
-.8'
.5
-1.2'
-.2
-4.2
-1.4'
.0'
.1
.6
-2.9
.7
.5
-.1
.5
-3.2
.1
.4
-.1
1.2
-2.8
.2
-.3
283.0
262.9
749.7
238.6
286.5
1.8
3.3
-.3
.8
-.5
.0
2.3
1.0
1.5
1.0'
-5.1
1.1'
.0
.1'
-.4
.(K
-.2
.4
-.8
-.1
-.4
-.2
314.0
293.0
-3.5
-1.5
-11.2
.9
2.0
-1.2
15.8
1.6
19.2
-26.4
8.7
2.9
1.3
6.4'
-S.O'
18.1
-7.6'
-15.7'
.4
-l.CK
-.4
1.1
-1.4'
-2.9
2.4
-.6
-2.8
.7
.0
1.5
3.0
-1.4
2.0
256.8
794.2
243.8
-.3
.2
-.2
PRODUCER PRICES
7 Finished goods
8 Consumer foods
9 Consumer energy
10 Other consumer goods
11 Capital equipment
12 Intermediate materials3
13 Excluding energy
14
15
16
Crude materials
Foods
Energy
Other
1. Not seasonally adjusted.
2. Figures for consumer prices are those for all urban consumers and reflect a
rental-equivalence measure of homeownership after 1982.
3. Excludes intermediate materials for food manufacturing and manufactured
animal feeds,
SOURCE. Bureau of Labor Statistics.
A52
2.16
Domestic Nonfinancial Statistics • June 1983
GROSS NATIONAL PRODUCT AND INCOME
Billions of current dollars except as noted; quarterly data are at seasonally adjusted annual rates.
1982
Account
1980
1981
1983
1982
Ql
Q2
Q3
Q4
Ql'
GROSS NATIONAL PRODUCT
1
Total
2,633.1
2,937.7
3,059.3
2,995.5
3,045.2
3,088.2
3,108.2
3,170.9
1,667.2
214.3
670.4
782.5
1,843.2
234.6
734.5
874.1
1,971.1
242.7
762.1
966.3
1,919.4
237.9
749.1
932.4
1,947.8
240.7
755.0
952.1
1,986.3
240.3
768.4
977.6
2,030.8
251.8
775.7
1,003.3
2,054.2
257.3
776.8
1,020.0
402.4
412.4
309.2
110.5
198.6
103.2
98.3
471.5
451.1
346.1
129.7
216.4
105.0
99.7
420.3
444.1
348.0
141.5
206.5
96.2
90.5
414.8
450.4
357.0
141.4
215.6
93.4
87.9
431.5
447.7
352.2
143.6
208.6
95.5
89.6
443.3
438.6
344.2
141.3
203.0
94.3
88.7
391.5
439.9
338.4
139.6
198.8
101.4
95.7
421.3
458.6
338.1
137.4
200.7
120.5
114.8
By source
2
3
4
5
Personal consumption expenditures
Durable goods
Nondurable goods
Services
6
7
8
9
10
11
12
Gross private domestic investment
Fixed investment
Nonresidential
Structures
Producers' durable equipment
Residential structures
Nonfarm
13
14
Change in business inventories
Nonfarm
-10.0
-5.7
20.5
15.0
-23.8
-24.3
-35.6
-36.0
-16.2
-15.0
4.7
3.7
-48.3
-50.0
-37.3
-36.6
15
16
17
Net exports of goods and services
Exports
Imports
25.2
339.2
314.0
26.1
367.3
341.3
20.5
350.8
330.3
31.3
359.9
328.6
34.9
365.8
330.9
6.9
349.5
342.5
9.1
328.1
319.1
19.0
331.9
312.9
18
19
20
Government purchases of goods and services
Federal
State and local
538.4
197.2
341.2
596.9
229.0
368.0
647.4
257.9
389.4
630.1
249.7
380.4
630.9
244.3
386.6
651.7
259.0
392.7
676.8
278.7
398.0
676.4
274.0
402.5
21
22
23
24
25
26
By major type of product
Final sales, total
Goods
Durable
Nondurable
Services
Structures
2,643.1
1,141.9
477.3
664.6
1,225.6
265.7
2,917.3
1,289.2
528.1
761.1
1,364.3
284.2
3,083.1
1,280.4
493.3
787.1
1,494.4
284.5
3,031.1
1,269.4
482.4
787.0
1,444.4
281.7
3,061.4
1,283.1
505.9
777.2
1,476.7
285.3
3,083.5
1,295.5
516.9
778.6
1,509.5
283.2
3,156.5
1,273.6
467.9
805.7
1,547.0
287.7
3,208.2
1,298.9
482.3
816.6
1,567.6
304.5
27
28
29
Change in business inventories
Durable goods
Nondurable goods
-10.0
-5.2
-4.8
20.5
8.7
11.8
-23.8
-18.9
-5.0
-35.6
-30.9
-4.8
-16.2
-6.6
-9.6
4.7
10.1
-5.4
-48.3
-48.3
.0
-37.3
-36.3
30 MEMO: Total GNP in 1972 dollars
1,474.0
1,502.6
1,476.9
1,470.7
1,478.4
1,481.1
1,477.2
1,486.2
-1.0
NATIONAL INCOME
31
Total
2,117.1
2,352.5
2,436.6
2,396.9
2,425.2
2,455.6
2,468.8
2,523.9
32
33
34
35
36
37
38
Compensation of employees
Wages and salaries
Government and government enterprises
Other
Supplement to wages and salaries
Employer contributions for social insurance
Other labor income
1,598.6
1,356.1
260.2
1,095.9
242.5
115.3
127.3
1,767.6
1,494.0
283.1
1,210.9
273.6
133.2
140.4
1,856.5
1,560.6
302.3
1,258.4
295.8
142.1
153.8
1,830.8
1,541.5
296.3
1,245.2
289.3
140.2
149.1
1,850.7
1,556.6
300.0
1,256.6
294.1
141.7
152.5
1,868.3
1,570.0
303.5
1,266.4
298.3
142.8
155.5
1,876.1
1,574.5
309.2
1,265.4
301.6
143.7
157.9
1,908.4
1,597.6
313.2
1,284.5
310.8
150.1
160.6
39
40
41
Proprietors' income1
Business
and professional1
Farm1
116.3
96.9
19.4
124.7
100.7
24.0
120.3
101.3
19.0
116.4
98.6
17.8
117.3
99.9
17.4
118.4
101.7
16.6
128.9
104.8
24.1
128.4
109.9
18.6
42
Rental income of persons2
43
44
45
46
Corporate profits1 3
Profits before tax
Inventory valuation adjustment
Capital consumption adjustment
47
Net interest
1. With inventory valuation and capital consumption adjustments.
2. With capital consumption adjustment.
32.9
33.9
34.1
33.9
34.2
34.6
33.9
35.3
181.6
242.5
-43.0
-17.8
190.6
232.1
-24.6
-16.8
160.8
174.9
-9.2
-4.9
157.1
171.6
-4.4
-10.1
155.4
171.7
-9.4
-6.9
166.2
180.3
-10.3
-3.8
164.6
175.9
-12.6
1.3
185.4
178.3
-.7
7.8
187.7
235.7
264.9
258.7
267.5
268.1
265.3
266.4
3. For after-tax profits, dividends, and the like, see table 1.48.
SOURCE. Survey of Current Business (Department of Commerce).
National Income Accounts
2.17
A53
PERSONAL INCOME AND SAVING
Billions of current dollars; quarterly data are at seasonally adjusted annual rates. Exceptions noted.
1983
1982
Account
1980
1981
1982
Q1
Q2
Q3
Q4
QL'
PERSONAL INCOME AND SAVING
1 Total personal income
2,160.2
2,404.1
2,569.9
2,510.5
2,552.7
2,592.5
2,624.0
2,648.2
2 Wage and salary disbursements
3 Commodity-producing industries
4
Manufacturing
5 Distributive industries
6 Service industries
7 Government and government enterprises
1,356.1
468.0
354.4
330.5
297.5
260.2
1,493.9
510.8
386.4
361.4
338.6
283.1
1,560.7
509.9
382.6
376.0
372.5
302.3
1,541.6
514.3
385.1
371.4
359.5
296.5
1,556.6
513.6
385.6
375.4
367.6
300.0
1,570.0
510.2
383.8
378.4
377.8
303.5
1,574.5
501.6
375.8
378.8
385.0
309.2
1,597.6
509.8
383.0
381.3
393.3
313.2
127.3
116.3
96.9
19.4
32.9
55.9
256.3
297.2
154.2
140.4
124.7
100.7
24.0
33.9
62.5
308.5
336.3
182.0
153.8
120.3
101.3
19.0
34.1
67.0
371.2
374.7
204.5
149.1
116.4
98.6
17.8
33.9
65.8
359.7
354.6
194.7
152.5
117.3
99.9
17.4
34.2
66.1
372.0
365.2
197.5
155.5
118.4
101.7
16.6
34.6
67.2
378.2
381.0
209.2
157.9
128.9
104.8
24.1
33.9
68.8
374.6
397.8
216.6
160.6
128.4
109.9
18.6
35.3
69.8
377.1
395.8
217.1
8
9
10
11
12
13
14
15
16
17
Other labor income
Proprietors' income1
Business
and professional1
Farm1
Rental income of persons2
Dividends
Personal interest income
Transfer payments . . . ;
Old-age survivors, disability, and health insurance benefits....
LESS: Personal contributions for social insurance
18 EQUALS: Personal income
88.7
104.9
111.7
110.6
111.4
112.4
112.5
116.4
2,160.2
2,404.1
2,569.9
2,510.5
2,552.7
2,592.5
2,624.0
2,648.2
336.2
386.7
397.2
393.4
401.2
394.4
399.7
401.0
20 EQUALS: Disposable personal income
1,824.1
2,029.2
2,172.7
2,117.1
2,151.5
2,198.1
2,224.3
2,247.2
21
1,717.9
1,898.9
2,030.5
1,977.9
2,007.2
2,046.1
2,090.9
2,115.3
144.3
152.0
133.4
131.9
19
LESS: Personal tax and nontax payments
LESS: Personal outlays
106.2
130.2
142.2
139.1
6,474
4,087
4,472
5.8
6,536
4,122
4,538
6.4
6,364
4,123
4,545
6.5
6,360
4,104
4,527
6.6
6,380
4,121
4,552
6.7
6,376
4,117
4,555
6.9
6,342
4,151
4,547
6.0
6,365
4,168
4,559
5.9
27 Gross saving
406.3
477.5
414.0
428.8
441.5
422.4
363.3
412.3
28
29
30
31
438.3
106.2
38.9
-43.0
504.7
130.2
44.4
-24.6
531.4
142.2
32.8
-9.2
520.3
139.1
32.5
-4.4
529.0
144.3
30.7
-9.4
546.1
152.0
34.8
-10.3
531.1
133.4
34.2
-12.6
544.0
131.9
46.1
-.7
181.2
112.0
.0
206.2
123.9
.0
225.1
131.3
.0
218.9
129.8
.0
223.4
130.5
.0
227.5
131.9
.0
230.6
132.9
.0
232.1
134.0
.0
-33.2
-61.4
28.2
-28.2
-60.0
31.7
-117.4
-149.5
32.1
-90.7
-118.4
27.7
-87.5
-119.6
32.1
-123.7
-156.0
32.3
-167.7
-204.2
36.4
-131.7
-173.9
42.2
22 EQUALS: Personal saving
MEMO:
Per capita (1972 dollars)
23 Gross national product
24 Personal consumption expenditures
25 Disposable personal income
26 Saving rate (percent)
GROSS SAVING
Gross private saving
Personal saving
Undistributed corporate profits'
Corporate inventory valuation adjustment
Capital consumption allowances
33 Noncorporate
34 Wage accruals less disbursements
35 Government surplus, or deficit (-), national income and
36
37
Federal
State and local
1.2
1.1
.0
.0
.0
.0
.0
.0
39 Gross investment
410.1
475.6
415.7
421.3
442.3
426.0
373.1
416.2
40 Gross private domestic
41 Net foreign
402.4
7.8
471.5
4.1
420.3
-4.6
414.8
6.5
431.5
10.8
443.3
-17.3
391.5
-18.5
421.3
-5.1
3.9
-1.9
1.7
-7.5
.8
3.6
9.7
3.9
38 Capital grants received by the United States, net
42 Statistical discrepancy
1. With inventory valuation and capital consumption adjustments.
2. With capital consumption adjustment.
SOURCE. Survey of Current Business (Department of Commerce).
A54
3.10
International Statistics • June 1983
U.S. INTERNATIONAL TRANSACTIONS
Summary
Millions of dollars; quarterly data are seasonally adjusted except as noted. 1
1981
Item credits or debits
1980
1981
1982
1982
Q4
Q2
Ql
Q3
Q4
1,520
4,471
-8,093
-927
1,293
1,034
729
2,188
2,841
-5,214
-7,436
-6,103
-4,227
-25,338
224,237
-249,575
-2,472
29,910
6,203
-27,889
236,254
-264,143
-1,541
33,037
7,471
-36,331
211,013
-247,344
640
28,720
6,746
-9,185
57,593
-66,778
-528
8,529
2,127
-5,938
55,607
-61,545
167
6,867
1,986
-5,762
55,001
-60,763
247
7,694
1,749
-12,495
52,334
-64,829
201
7,082
1,647
-12,136
48,071
-60,207
24
7,076
1,364
-2,101
-4,681
-2,104
-4,504
-2,455
-5,413
-562
-1,308
-575
-1,473
-671
-1,069
-601
-1,048
-608
-1,823
11 Change in U.S. government assets, other than official reserve assets, net (increase, - )
-5,126
-5,137
-5,766
-987
-904
-1,547
-2,496
-818
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
-8,155
0
-16
-1,667
-6,472
-5,175
0
-1,824
-2,491
-861
-4,965
0
-1,371
-2,552
-1,041
262
0
-134
-358
754
-1,089
0
-400
-547
-142
-1,132
0
-241
-814
-77
-794
0
-434
-459
99
-1,949
0
-297
-732
-920
17 Change in U.S. private assets abroad (increase, -) 3
18 Bank-reported claims
19 Nonbank-reported claims
20 U.S. purchase of foreign securities, 3net
21 U.S. direct investments abroad, net
-72,746
-46,838
-3,146
-3,524
-19,238
-98,982
-84,531
-331
-5,429
-8,691
-107,535
-106,711
4,750
-7,772
2,198
-46,952
-42,645
-508
-2,843
-956
-29,264
-32,708
4,112
-531
-137
-35,166
-36,923
-304
-441
2,502
-22,307
-20,430
942
-3,266
447
-20,800
-16,650
n.a.
-3,535
-615
22 Change in foreign official assets in the United States
(increase, +)
23 U.S. Treasury securities
24 Other U.S. government obligations
25 Other U.S. government liabilities4
26 Other U.S. liabilities reported
by U.S. banks
27 Other foreign official assets3
15,442
9,708
2,187
561
-159
3,145
4,785
4,983
1,289
-69
-4,083
2,665
3,043
5,716
-670
-12
-1,713
-278
8,119
4,439
-246
275
3,436
215
-3,122
-1,344
-296
-182
-1,516
216
1,998
-2,076
258
387
3,393
36
2,494
4,825
-76
-286
-1,981
12
1,673
4,311
-556
69
-1,609
-542
28 Change in foreign3 private assets in the United States
(increase, +)
29 U.S. bank-reported liabilities
30 U.S. nonbank-reported liabilities
31 Foreign private purchases of U.S. Treasury securities, net
32 Foreign purchases of other U.S. securities, net
33 Foreign direct investments in the United States, net3
39,041
10,743
6,530
2,645
5,457
13,666
73,136
41,262
532
2,932
7,109
21,301
81,451
62,869
-3,760
6,945
5,973
9,424
30,988
20,476
-457
1,238
396
9,336
28,202
25,423
-982
1,277
1,319
1,165
27,621
22,552
-2,304
2,095
2,497
2,781
14,178
10,687
-474
1,316
220
2,429
11,451
4,207
n.a.
2,257
1,938
3,049
34 Allocation of SDRs
35 Discrepancy
1,152
28,870
1,093
25,809
0
41,864
0
9,497
2,474
0
5,142
-802
0
6,038
672
0
14,139
-1,904
0
16,546
2,035
28,870
25,809
41,864
7,023
5,944
5,366
16,043
14,511
-8,155
-5,175
-4,965
262
-1,089
-1,132
-794
-1,949
14,881
4,854
3,055
7,844
-2,940
1,611
2,780
1,604
12,769
13,314
7,176
2,230
4,988
3,079
350
-1,241
631
602
514
64
93
125
137
158
1 Balance on current account
3
4
5
6
7
8
9
10
37
Merchandise trade balance2
Merchandise exports
Merchandise imports
Military transactions, net
Investment income, net3
Other service transactions, net
Remittances, pensions, and other transfers
U.S. government grants (excluding military)
Statistical discrepancy in recorded data before seasonal
adjustment
MEMO:
Changes in official assets
U.S. official reserve assets (increase, - )
Foreign official assets in the United States
(increase, +)
40 Change in Organization of Petroleum Exporting Countries
official assets in the United States (part of line 22
above)
41 Transfers under military grant programs (excluded from
lines 4, 6, and 10 above)
38
39
1. Seasonal factors are no longer calculated for lines 12 through 41.
2. Data are on an international accounts (IA) basis. Differs from the Census
basis data, shown in table 3.11, for reasons of coverage and timing; military
exports are excluded from merchandise data and are included in line 6.
3. Includes reinvested earnings of incorporated affiliates.
4. Primarily associated 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.
NOTE. Data are from Bureau of Economic Analysis, Survey of Current Business
(U.S. Department of Commerce).
Trade and Reserve and Official Assets
3.11
A55
U.S. FOREIGN TRADE
Millions of dollars; monthly data are seasonally adjusted
1982
Item
1980
1981
Oct.
1 EXPORTS of domestic and foreign
merchandise excluding grant-aid
shipments
220,626
233,677
1983
1982
212,193
Nov.
16,671
Dec.
Jan.
16,347
15,852
Mar.
Feb.
17,393
16,326
Apr.
16,752
16,074
2 GENERAL IMPORTS including merchandise for immediate consumption plus entries into bonded
warehouses
244,871
261,305
243,952
21,006
18,892
19,154
20,021
19,015
19,525
19,771
3 Trade balance
-24,245
-27,628
-31,759
-4,335
-3,041
-2,808
-2,628
-2,689
-2,774
-3,697
not covered in Census statistics, and (2) the exclusion of military sales (which are
combined with other military transactions and reported separately in the "service
account" in table 3.10, line 6). On the import side, additions are made for gold,
ship purchases, imports of electricity from Canada and other transactions;
military payments are excluded and shown separately as indicated above.
NOTE. The data through 1981 in this table are reported by the Bureau of Census
data of a free-alongside-ship (f.a.s.) value basis—that is, value at the port of
export. Beginning in 1981, foreign trade of the U.S. Virgin Islands is included in
the Census basis trade data; this adjustment has been made for all data shown in
the table. Beginning with 1982 data, the value of imports are on a customs
valuation basis.
The Census basis data differ from merchandise trade data shown in table 3.10,
U.S. International Transactions Summary, for reasons of coverage and timing. On
the export side, the largest adjustments are: (1) the addition of exports to Canada
3.12
SOURCE. FT900 "Summary of U.S. Export and Import Merchandise Trade"
(U.S. Department of Commerce, Bureau of the Census).
U.S. RESERVE ASSETS
Millions of dollars, end of period
1982
Type
1979
1980
1983
1981
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
May
1 Total
18,956
26,756
30,075
34,006
33,958
33,936
34,233
34,261
34,173
33,931
2 Gold stock, including
Exchange Stabilization Fund1
11,172
11,160
11,151
11,148
11,148
11,144
11,139
11,138
11,132
11,132
2,724
2,610
4,095
4,929
5,250
5,267
5,284
5,229
5,192
5,525
3 Special drawing rights2,3
4 Reserve position
in International Monetary Fund2
1,253
2,852
5,055
7,185
7,348
8,035
8,594
9,293
9,284
9,424
5 Foreign currencies4,5
3,807
10,134
9,774
10,744
10,212
9,490
9,216
8,601
8,565
7,850
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. Gold stock is valued at $42.22 per fine troy ounce.
2. Beginning July 1974, the IMF adopted a technique for valuing the SDR based
on a weighted average of exchange rates for the currencies of member countries.
From July 1974 through December 1980, 16 currencies were used; from January
1981, 5 currencies have been used. The U.S. SDR holdings and reserve position in
the IMF also are valued on this basis beginning July 1974.
3.13
3. Includes allocations by the International Monetary Fund of SDRs as follows:
$867 million on Jan. 1, 1970; $717 million on Jan. 1, 1971; $710 million on Jan. 1,
1972; $1,139 million on Jan. 1, 1979; $1,152 million on Jan. 1, 1980; and $1,093
million on Jan. 1, 1981; plus transactions in SDRs.
4. Valued at current market exchange rates.
5. Includes U.S. government securities held under repurchase agreement
against receipt of foreign currencies in 1979 and 1980.
FOREIGN OFFICIAL ASSETS HELD AT FEDERAL RESERVE BANKS
Millions of dollars, end of period
1982
Assets
1979
1980
Nov.
1 Deposits
Assets held in custody
2 U.S. Treasury securities'
3 Earmarked gold2
Dec.
Jan.
Feb.
Mar.
Apr.
May
429
411
505
386
328
366
352
424
322
445
95,075
15,169
102,417
14,965
104,680
14,804
107,467
14,711
112,544
14,716
115,872
14,717
116,428
14,752
114,999
14,726
114,880
14,723
115,401
14,727
1. Marketable U.S. Treasury bills, notes, and bonds; and nonmarketable U.S.
Treasury securities payable in dollars and in foreign currencies.
2. Earmarked gold is valued at $42.22 per fine troy ounce.
1983
1981
NOTE. Excludes deposits and U.S. Treasury securities held for international
and regional organizations. Earmarked gold is gold held for foreign and international accounts and is not included in the gold stock of the United States.
A56
3.14
International Statistics • June 1983
FOREIGN BRANCHES OF U.S. BANKS
Balance Sheet Data
Millions of dollars, end of period
1982
Asset account
1983
1979
Sept.
Oct.
Nov.
Dec.
Jan/
Feb.
Mar.P
All foreign countries
1 Total, all currencies
2 Claims on United States
3 Parent bank
4 Other
5 Claims on foreigners
6 Other branches of parent bank
7 Banks
8 Public borrowers
9 Nonbank foreigners
10 Other assets
11 Total payable in U.S. dollars
12 Claims on United States
13 Parent bank
14 Other
15 Claims on foreigners
16 Other branches of parent bank
17 Banks
18 Public borrowers
19 Nonbank foreigners
20 Other assets
364,409
401,135
462,790
471,085
463,601
468,376
468,740
462,435
457,848
465,254
32,302
25,929
6,373
28,460
20,202
8,258
63,743
43,267
20,476
90,267
60,872
29,395
89,036
61,283
27,753
90,844
62,476
28,368
91,752
61,629
30,123
89,249
59,247
30,002
87,567
58,470
29,097
93,830
63,398
30,432
317,330
79,662
123,420
26,097
88,151
354,960
77,019
146,448
28,033
103,460
378,899
87,821
150,708
28,197
112,173
360,462
93,283
135,454
24,333
107,392
354,373
90,030
133,365
23,850
107,128
357,104
91,894
133,269
23,340
108,601
357,5%
91,067
133,300
23,968
109,261
353,675
89,470
130,%5
24,464
108,776
351,015
89,715
129,067
24,585
107,648
352,427
89,099
132,279
24,547
106,502
14,777
17,715
20,148
20,356
20,192
20,428
19,392
19,511
19,266
18,997
267,713
291,798
350,678
369,746
361,804
363,483
361,169
355,165
350,314
356,613
31,171
25,632
5,539
27,191
19,896
7,295
62,142
42,721
19,421
88,613
60,207
28,406
87,316
60,538
26,778
88,971
61,662
27,309
90,032
60,973
29,059
87,555
58,479
29,076
85,941
57,767
28,174
91,391
62,463
28,928
229,120
61,525
96,261
21,629
49,705
255,391
58,541
117,342
23,491
56,017
276,882
69,398
122,055
22,877
62,552
268,253
77,470
110,591
18,984
61,208
261,896
74,032
107,448
18,659
61,757
261,701
74,759
106,636
18,187
62,119
259,127
73,463
106,001
18,303
61,360
255,788
71,174
103,538
18,717
62,359
252,752
71,885
100,697
18,891
61,279
253,618
70,782
103,609
18,694
60,533
7,422
9,216
11,654
12,880
12,592
12,811
12,010
11,822
11,621
11,604
United Kingdom
21 Total, all currencies
22 Claims on United States
23 Parent bank
24 Other
25 Claims on foreigners
26 Other branches of parent bank
27 Banks
28 Public borrowers
29 Nonbank foreigners
30 Other assets
130,873
144,717
157,229
167,189
164,582
165,687
1(1,067
157,464
156,577
156,022
11,117
9,338
1,779
7,509
5,275
2,234
11,823
7,885
3,938
27,534
22,970
4,564
27,829
23,717
4,112
28,677
24,278
4,399
27,354
23,017
4,337
27,175
22,539
4,636
26,423
21,962
4,461
26,259
21,912
4,347
115,123
34,291
51,343
4,919
24,570
131,142
34,760
58,741
6,688
30,953
138,888
41,367
56,315
7,490
33,716
132,746
40,385
52,203
6,086
34,072
129,913
37,013
52,568
6,157
34,175
130,666
38,319
51,414
6,170
34,763
127,734
37,000
50,767
6,240
33,727
124,354
34,959
49,497
6,421
33,477
124,214
35,437
48,580
6,592
33,605
123,993
36,171
48,976
6,337
32,509
4,633
6,066
6,518
6,909
6,840
6,344
5,979
5,935
5,940
5,770
31 Total payable in U.S. dollars
94,287
99,699
115,188
131,129
127,517
128,863
123,740
120,Z33
119,273
118,891
32 Claims on United States
33 Parent bank
34 Other
10,746
9,297
1,449
7,116
5,229
1,887
11,246
7,721
3,525
26,919
22,758
4,161
27,255
23,478
3,777
28,093
24,035
4,058
26,761
22,756
4,005
26,581
22,250
4,331
25,829
21,700
4,129
25,597
21,626
3,971
35 Claims on foreigners
36 Other branches of parent bank
37 Banks
38 Public borrowers
39 Nonbank foreigners
81,294
28,928
36,760
3,319
12,287
89,723
28,268
42,073
4,911
14,471
99,850
35,439
40,703
5,595
18,113
99,008
35,703
39,786
4,214
19,305
95,269
32,243
39,077
4,251
19,698
95,870
33,154
38,310
4,281
20,125
92,228
31,648
36,717
4,329
19,534
89,137
29,380
35,616
4,600
19,541
88,973
29,918
34,499
4,789
19,767
88,797
30,589
34,442
4,413
19,353
2,247
2,860
4,092
5,202
4,993
4,900
4,751
4,515
4,471
4,497
40 Other assets
Bahamas and Caymans
108,977
123,837
149,051
140,614
139,438
140,939
144,843
142,718
138,676
145,663
42 Claims on United States
43 Parent bank
44 Other
41 Total, all currencies
19,124
15,196
3,928
17,751
12,631
5,120
46,546
31,643
14,903
55,467
32,155
23,312
55,713
32,927
22,786
57,076
34,022
23,054
59,387
34,653
24,734
56,855
32,511
24,344
56,205
32,819
23,386
62,686
38,021
24,665
45 Claims on foreigners
46 Other branches of parent bank
47 Banks
48 Public borrowers
49 Nonbank foreigners
86,718
9,689
43,189
12,905
20,935
101,926
13,342
54,861
12,577
21,146
98,002
12,951
55,096
10,010
19,945
81,054
17,772
41,333
6,999
14,950
79,539
17,955
40,439
6,743
14,402
79,185
18,066
41,025
6,310
13,784
81,157
18,720
42,406
6,413
13,618
81,773
20,118
40,732
6,434
14,489
78,494
19,730
39,068
6,494
13,202
79,040
17,512
42,288
6,540
12,700
50 Other assets
51 Total payable in U.S. dollars
3,135
4,160
4,503
4,093
4,186
4,678
4,299
4,089
3,977
3,937
102,368
117,654
143,686
136,077
134,607
135,648
139,292
136,881
132,830
139,549
Overseas Branches
3.14
A57
Continued
1982
Liability account
1983
1981
Sept.
Oct.
Nov.
Dec.
Jan/
Feb.
Mar.P
All foreign countries
364,409
401,135
462,790
471,085
463,601
468,376
468,740
462,435
457,848
465,254
53 To United States
54 Parent bank
55 Other banks in United States
56 Nonbanks
66,689
24,533
13,968
28,188
91,079
39,286
14,473
37,275
137,712
56,289
19,197
62,226
172,994
69,592
33,763
69,639
169,312
64,102
32,607
72,603
171,762
66,254
31,764
73,744
178,449
75,118
33,353
69,978
178,434
79,950
32,784
65,700
176,071
77,301
32,643
66,127
185,154
81,209
33,930
70,015
57 To foreigners
58 Other branches of parent bank
59 Banks
60 Official institutions
61 Nonbank foreigners
283,510
77,640
122,922
35,668
47,280
295,411
75,773
132,116
32,473
55,049
305,630
86,396
124,906
25,997
68,331
277,886
91,189
99,966
20,527
66,204
274,222
91,658
98,259
19,440
64,865
276,287
91,270
98,209
21,095
65,713
270,494
90,079
96,677
19,614
64,124
265,591
89,293
92,857
20,250
63,491
263,523
90,384
90,218
19,742
63,179
262,320
91,349
91,786
17,812
61,373
52 Total, all currencies
14,210
14,690
19,448
20,205
20,067
20,327
19,797
18,410
18,254
17,780
273,857
303,281
364,390
385,440
377,121
379,142
378,457
370,618
367,352
374,620
64 To United States
65 Parent bank
66 Other banks in United States
67 Nonbanks
64,530
23,403
13,771
27,356
88,157
37,528
14,203
36,426
134,645
54,437
18,883
61,325
170,098
67,678
33,508
68,912
166,377
62,191
32,362
71,824
168,291
63,963
31,428
72,900
174,966
72,7%
32,988
69,182
174,813
77,682
32,260
64,871
172,402
74,972
32,216
65,214
181,666
78,908
33,490
69,268
68 To foreigners
69 Other branches of parent bank
70 Banks
71 Official institutions
72 Nonbank foreigners
201,514
60,551
80,691
29,048
31,224
206,883
58,172
87,497
24,697
36,517
217,602
69,299
79,594
20,288
48,421
203,989
75,935
62,535
16,607
48,912
199,297
76,237
59,782
15,253
48,025
198,938
74,621
58,829
16,774
48,714
192,271
72,848
57,355
15,055
47,013
185,667
71,442
52,258
15,940
46,027
185,570
72,753
51,267
15,381
46,169
183,553
73,495
52,217
13,536
44,305
7,813
8,241
12,143
11,353
11,447
11,913
11,220
10,138
9,380
9,401
62 Other liabilities
63 Total payable in U.S. dollars
73 Other liabilities
United Kingdom
74 Total, all currencies
75 To United States
76 Parent bank
77 Other banks in United States
78 Nonbanks
79 To foreigners
80 Other branches of parent bank
81 Banks
82 Official institutions
83 Nonbank foreigners
130,873
144,717
157,229
167,189
164,582
165,687
161,067
157,464
156,577
156,022
20,986
3,104
7,693
10,189
21,785
4,225
5,716
11,844
38,022
5,444
7,502
25,076
53,919
11,336
13,280
29,303
53,777
10,568
12,567
30,642
54,003
10,597
12,374
31,032
53,954
13,091
12,205
28,658
52,650
14,287
12,343
26,020
51,927
14,080
12,198
25,649
55,309
14,616
13,172
27,521
104,032
12,567
47,620
24,202
19,643
117,438
15,384
56,262
21,412
24,380
112,255
16,545
51,336
16,517
27,857
104,967
19,123
45,526
12,348
27,970
102,611
18,399
45,601
11,379
27,232
103,927
19,372
44,266
12,940
27,349
99,567
18,361
44,020
11,504
25,682
97,827
19,343
41,073
12,377
25,034
97,515
21,008
39,892
12,025
24,590
93,835
19,653
40,867
10,252
23,063
5,855
5,494
6,952
8,303
8,194
7,757
7,546
6,987
7,135
6,878
85 Total payable in U.S. dollars
95,449
103,440
120,277
137,268
133,591
135,188
130,261
126,286
126,007
126,088
86 To United States
87 Parent bank
88 Other banks in United States
89 Nonbanks
20,552
3,054
7,651
9,847
21,080
4,078
5,626
11,376
37,332
5,350
7,249
24,733
53,262
11,223
13,142
28,897
53,146
10,442
12,472
30,232
53,056
10,306
12,188
30,562
53,029
12,814
12,026
28,189
51,808
14,105
12,128
25,575
50,977
13,859
12,041
25,077
54,520
14,476
12,987
27,057
90 To foreigners
91 Other branches of parent bank
92 Banks
93 Official institutions
94 Nonbank foreigners
72,397
8,446
29,424
20,192
14,335
79,636
10,474
35,388
17,024
16,750
79,034
12,048
32,298
13,612
21,076
80,025
15,548
31,187
11,012
22,278
76,519
14,614
30,404
9,806
21,695
77,982
15,310
29,092
11,198
22,382
73,477
14,300
28,810
9,668
20,699
71,000
15,081
25,177
10,657
20,085
71,994
16,709
25,563
10,121
19,601
68,309
14,918
26,395
8,419
18,577
2,500
2,724
3,911
3,981
3,926
4,150
3,755
3,478
3,036
3,259
84 Other liabilities
95 Other liabilities
Bahamas and Caymans
108,977
123,837
149,051
140,614
139,438
140,939
144,843
142,718
138,676
145,663
97 To United States
98 Parent bank
99 Other banks in United States
100 Nonbanks
37,719
15,267
5,204
17,248
59,666
28,181
7,379
24,106
85,704
39,396
10,474
35,834
99,500
44,370
17,927
37,203
96,810
40,225
17,481
39,104
98,475
41,900
16,805
39,770
104,139
46,811
18,461
38,867
104,572
50,622
17,554
36,396
102,466
47,587
17,321
37,558
107,576
51,636
17,300
38,640
101 To foreigners
102 Other branches of parent bank
103 Banks
104 Official institutions
105 Nonbank foreigners
68,598
20,875
33,631
4,866
9,226
61,218
17,040
29,895
4,361
9,922
60,012
20,641
23,202
3,498
12,671
38,401
15,126
10,910
2,091
10,274
39,793
17,421
10,297
2,137
9,938
39,603
17,566
10,413
1,846
9,778
38,249
15,796
10,166
1,967
10,320
35,900
14,688
9,279
1,849
10,084
33,859
13,809
8,451
1,720
9,879
35,878
16,055
9,027
1,678
9,118
96 Total, all currencies
106 Other liabilities
107 Total payable in U.S. dollars
2,660
2,953
3,335
2,713
2,835
2,861
2,455
2,246
2,351
2,209
103,460
119,657
145,227
137,717
136,574
137,828
141,595
139,305
135,323
142,465
A58
3.15
International Statistics • June 1983
SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS
Millions of dollars, end of period
1982
Item
1 Total1
4
5
6
By type
Liabilities reported by banks in the3 United States2
U.S. Treasury bills and certificates
U.S. Treasury bonds and notes
Marketable
Nonmarketable4
U.S. securities other than U.S. Treasury securities5
7
8
9
10
11
12
By area
Western Europe1
Canada
Latin America and Caribbean
Asia
Africa
Other countries6
2
3
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.P
Apr.?
164,578
170,109
171,406
168,025
172,780
175,163
172,915
173,119
173,414
30,381
56,243
26,928
52,389
27,056
43,964
25,338
42,906
24,873
46,658
23,842
50,432
21,422
49,954
22,980
47,917
22,693
48,399
41,455
14,654
21,845
53,186
11,791
25,815
65,619
9,350
25,417
65,850
8,750
25,181
67,715
8,750
24,784
67,735
8,750
24,404
69,303
7,950
24,286
70,250
7,950
24,022
70,558
7,950
23,814
81,592
1,562
5,688
70,784
4,123
829
65,891
2,403
6,954
91,790
1,829
1,242
60,846
2,204
7,231
95,110
1,452
4,563
59,447
2,044
5,900
93,960
1,371
5,303
61,501
2,070
6,028
95,922
1,350
5,909
62,525
2,430
7,138
95,278
1,716
6,076
62,103
2,754
6,100
95,677
1,327
4,954
61,734
2,942
5,578
96,789
1,162
4,914
62,169
2,770
6,161
95,331
1,208
5,775
1. Includes the Bank for International Settlements.
2. Principally demand deposits, time deposits, bankers acceptances, commercial paper, negotiable time certificates of deposit, and borrowings under repurchase agreements.
3. Includes nonmarketable certificates of indebtedness (including those payable in foreign currencies through 1974) and Treasury bills issued to official
institutions of foreign countries.
4. Excludes notes issued to foreign official nonreserve agencies. Includes
bonds and notes payable in foreign currencies.
3.16
1983
1981r
1980
5. Debt securities of U.S. government corporations and federally sponsored
agencies, and U.S. corporate stocks and bonds.
6. Includes countries in Oceania and Eastern Europe.
NOTE. Based on Treasury Department data and on data reported to the
Treasury Department by banks (including Federal Reserve Banks) and securities
dealers in the United States.
LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Banks in the United States
Payable in Foreign Currencies
Millions of dollars, end of period
1982
Item
1979
1980
June
1 Banks' own liabilities
2 Banks' own claims
3 Deposits
4 Other claims
5 Claims of banks' domestic customers1
1. Assets owned by customers of the reporting bank located in the United
States that represent claims on foreigners held by reporting banks for the accounts
of their domestic customers.
1,918
2,419
994
1,425
580
3,748
4,206
2,507
1,699
962
1983
1981
3,523
4,980
3,398
1,582
971
4,513
5,895
3,565
2,329
921
Sept.
4,575
6,337
3,429
2,908
506
Dec.
4,751
7,689
4,241
3,448
676
Mar.P
5,072
8,101
3,725
4,376
637
NOTE. Data on claims exclude foreign currencies held by U.S. monetary
authorities,
Nonbank-Reported
3.17
LIABILITIES TO FOREIGNERS
Payable in U.S. dollars
Data
Reported by Banks in the United States
Millions of dollars, end of period
1983
1982
Holder and type of liability
1979
1980
1981A
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.''
1 All foreigners
187,521
205,297
244,043
300,811
302,776
305,320
304,779
304,653'
316,117
308,936
2 Banks' own liabilities
3 Demand deposits
4 Time 2deposits1
5 Other
6 Own foreign offices3
117,196
23,303
13,623
16,453
63,817
124,791
23,462
15,076
17,583
68,670
163,738
19,628
28,992
17,617
97,500
221,055
17,059
62,172
22,930
118,894
226,068
17,148
62,718
24,414
121,788
225,379
16,017
67,072
23,791
118,499
219,361
16,089
64,347
22,918
116,006
219,666'
17,423
65,273
20,295
116,676'
234,317
16,495
68,491
24,566
124,765
226,019
15,695
67,303
21,882
121,139
70,325
48,573
80,506
57,595
80,305
55,316
79,756
53,374
76,708
52,138
79,941
55,614
85,419
62,137
84,987
61,904
81,800
58,747
82,917
60,087
19,396
2,356
20,079
2,832
19,019
5,970
22,668
3,715
20,965
3,605
20,625
3,702
19,352
3,930
19,205
3,877
18,831
4,222
18,799
4,031
2,356
2,344
2,721
6,036
6,465
4,597
6,611
5,969
3,949
5,917
714
260
151
303
444
146
85
212
638
262
58
318
2,337
261
431
1,645
3,387
257
969
2,161
1,584
106
1,339
139
1,787
284
1,333
170
1,695
195
1,367
134
1,304
221
917
166
2,542
252
2,031
259
1,643
102
1,900
254
2,083
541
3,699
2,160
3,078
1,774
3,013
1,621
4,824
3,603
4,275
3,153
2,645
1,501
3,375
2,230
1,538
2
1,646
0
1,542
0
1,539
0
1,304
0
1,392
0
1,221
0
1,122
0
1,144
0
1,145
0
20 Official institutions
78,206
86,624
79,318
71,021
68,244
71,531
74,274
71,377
70,897
71,092
21 Banks' own liabilities
22 Demand deposits
23 Time deposits1
24 Other2
18,292
4,671
3,050
10,571
17,826
3,771
3,612
10,443
17,094
2,564
4,230
10,300
16,989
2,138
6,132
8,720
16,638
2,074
5,539
9,025
16,526
1,981
5,489
9,057
16,411
2,168
4,907
9,336
14,620
2,063
5,481
7,076
16,443
2,287
5,331
8,825
16,060
2,322
6,031
7,706
25 Banks' custody liabilities4
26 U.S. Treasury bills and certificates5
27 Other negotiable6 and readily transferable
instruments
28 Other
59,914
47,666
68,798
56,243
62,224
52,389
54,031
43,964
51,607
42,906
55,006
46,658
57,864
50,432
56,756
49,954
54,454
47,917
55,032
48,399
12,196
52
12,501
54
9,787
47
10,033
34
8,672
28
8,319
28
7,396
35
6,769
33
6,512
25
6,618
15
29 Banks9
88,316
96,415
136,030
182,766
185,679
185,097
178,460
180,891'
192,698
183,610
30 Banks' own liabilities
31 Unaffiliated foreign banks
32
Demand deposits
33
Time 2deposits1
34
Other
35 Own foreign offices3
83,299
19,482
13,285
1,667
4,530
63,817
90,456
21,786
14,188
1,703
5,895
68,670
124,312
26,812
11,614
8,735
6,462
97,500
166,268
47,374
9,882
26,026
11,466
118,894
169,412
47,624
9,724
26,035
11,865
121,788
168,679
50,179
8,733
28,267
13,179
118,499
161,637
45,631
8,186
25,556
11,889
116,006
162,878'
46,202
9,627
25,297
11,278
116,676'
174,321
49,556
8,264
27,613
13,679
124,765
165,157
44,019
7,691
24,233
12,095
121,139
5,017
422
5,959
623
11,718
1,687
16,498
5,634
16,267
5,792
16,419
5,809
16,822
6,292
18,012
6,791
18,377
7,122
18,453
7,475
2,415
2,748
2,588
4,421
2,179
5,611
8,061
2,803
7,782
2,693
7,844
2,766
7,698
2,833
8,345
2,876
8,266
2,990
8,041
2,937
40 Other foreigners
18,642
19,914
25,974
40,989
42,388
44,095
45,434
46,416
48,573
48,316
41 Banks' own liabilities
42 Demand deposits
43 Time deposits
44 Other2
14,891
5,087
8,755
1,048
16,065
5,356
9,676
1,033
21,694
5,189
15,969
537
35,461
4,778
29,583
1,100
36,631
5,093
30,175
1,363
38,591
5,197
31,977
1,416
39,526
5,452
32,551
1,524
40,473
5,539
33,128
1,807
42,249
5,724
34,630
1,896
42,260
5,430
35,009
1,821
3,751
382
3,849
474
4,279
699
5,528
1,615
5,756
1,666
5,504
1,525
5,908
1,810
5,943
2,006
6,323
2,207
6,056
1,983
3,247
123
3,185
190
3,268
312
3,035
878
3,207
884
3,070
908
3,037
1,062
2,970
968
2,909
1,207
2,995
1,078
10,984
10,745
10,747
15,029
14,408
14,296
13,367
11,611
11,383
11,603
7 Banks' custody liabilities4
8 U.S. Treasury bills and certificates5
9 Other negotiable6 and readily transferable
instruments
10 Other
11 Nonmonetary international
and regional
organizations7
12 Banks' own liabilities
13 Demand deposits
14 Time 2deposits1
15 Other
16 Banks' custody liabilities4
17 U.S. Treasury bills and certificates
18 Other negotiable6 and readily transferable
instruments
19 Other
8
36 Banks' custody liabilities4
37 U.S. Treasury bills and certificates
38 Other negotiable6 and readily transferable
instruments
39 Other
45 Banks' custody liabilities4
46 U.S. Treasury bills and certificates
47 Other negotiable6 and readily transferable
instruments
48 Other
49 MEMO: Negotiable time certificates of
deposit in custody for foreigners
1. Excludes negotiable time certificates of deposit, which are included in
"Other negotiable and readily transferable instruments."
2. Includes borrowing under repurchase agreements.
3. U.S. banks: includes amounts due to own foreign branches and foreign
subsidiaries consolidated in "Consolidated Report of Condition" filed with bank
regulatory agencies. Agencies, branches, and majority-owned subsidiaries of
foreign banks: principally amounts due to head office or parent foreign bank, and
foreign branches, agencies or wholly owned subsidiaries of head office or parent
foreign bank.
4. Financial claims on residents of the United States, other than long-term
securities, held by or through reporting banks.
5. Includes nonmarketable certificates of indebtedness and Treasury bills
issued to official institutions of foreign countries.
6. Principally bankers acceptances, commercial paper, and negotiable time
certificates of deposit.
7. Principally the International Bank for Reconstruction and Development, and
the Inter-American and Asian Development Banks.
8. Foreign central banks and foreign central governments, and the Bank for
International Settlements.
9. Excludes central banks, which are included in "Official institutions."
• Liabilities and claims of banks in the United States were increased,
beginning in December 1981, by the shift from foreign branches to international
banking facilities in the United States of liabilities to, and claims on, foreign
residents.
A59
A60
3.17
International Statistics • June 1983
Continued
1982
Area and country
1979
1980
1983
1981A
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.P
1 Total
187,521
205,297
244,043
300,811
302,776
305,320
304,779
304,653'
316,117
308,936
2 Foreign countries
185,164
202,953
241,321
294,776
2%,311
300,723
298,168
298,683'
312,168
303,018
90,952
413
2,375
1,092
398
10,433
12,935
635
7,782
2,337
1,267
557
1,259
2,005
17,954
120
24,700
266
4,070
52
302
90,897
523
4,019
497
455
12,125
9,973
670
7,572
2,441
1,344
374
1,500
1,737
16,689
242
22,680
681
6,939
68
370
91,309
596
4,117
333
296
8,486
7,665
463
7,290
2,823
1,457
354
916
1,545
18,720
518
28,287
375
6,526
49
493
116,015
508
2,782
166
478
7,358
5,360
516
5,541
3,102
2,026
356
1,315
1,997
27,619
317
49,009
390
6,524
111
541
117,242
441
2,499
221
572
7,065
6,093
496
4,779
3,100
2,197
453
1,301
1,615
27,994
255
50,274
470
6,889
45
486
117,695
512
2,517
509
748
8,169
5,375
537
5,674
3,362
1,567
388
1,405
1,380
28,999
296
48,169
499
6,965
50
573
118,764
467
2,270
996
473
8,462
5,807
589
4,938
3,770
1,476
398
1,316
1,315
28,996
190
50,339
470
6,033
47
412
116,019
513
2,295
1,197
369
7,723
6,227
595
4,514
3,196
1,407
370
1,524
1,645
30,263'
. 251
47,202
452
5,898'
41
335
116,456
604
2,726
765
408
6,780
6,458
597
4,312
3,704
1,061
363
1,640
1,379
30,433
254
47,703
491
6,365
40
374
111,279
576
2,800
849
437
7,098
3,441
671
5,024
3,966
1,566
346
1,484
1,212
29,468
231
45,007
504
6,137
44
416
3 Europe
4 Austria
5 Belgium-Luxembourg
6 Denmark
1 Finland
8 France
9 Germany
10 Greece
11 Italy
12 Netherlands
13 Norway
14 Portugal
15 Spain
16 Sweden
17 Switzerland
18 Turkey
19 United Kingdom
20 Yugoslavia
21 Other Western Europe1
22 U.S.S.R
23 Other Eastern Europe2
24 Canada
7,379
10,031
10,250
12,163
11,719
12,217
10,990
13,618
15,159
14,695
25 Latin America and Caribbean
26 Argentina
27 Bahamas
28 Bermuda
29 Brazil
30 British West Indies
31 Chile
32 Colombia
33 Cuba
34 Ecuador
35 Guatemala
36 Jamaica
37 Mexico
38 Netherlands Antilles
39 Panama
40 Peru
41 Uruguay
42 Venezuela
43 Other Latin America and Caribbean
49,686
1,582
15,255
430
1,005
11,138
468
2,617
13
425
414
76
4,185
499
4,483
383
202
4,192
2,318
53,170
2,132
16,381
670
1,216
12,766
460
3,077
6
371
367
97
4,547
413
4,718
403
254
3,170
2,123
85,159
2,445
34,856
765
1,568
17,794
664
2,993
9
434
479
87
7,170
3,182
4,857
694
367
4,245
2,548
108,687
3,482
43,123
1,507
2,020
23,068
1,447
2,407
7
556
636
118
8,031
3,677
4,770
1,031
844
8,796
3,166
110,140
3,432
44,125
1,596
1,986
24,276
1,444
2,426
8
519
639
108
8,047
3,518
4,798
959
651
8,315
3,293
112,916
3,577
44,026
1,572
2,010
26,372
1,626
2,593
9
453
670
126
7,967
3,597
4,738
1,147
759
8,382
3,291
110,576
4,833
42,911
1,989
1,916
24,630
1,341
2,384
10
472
682
115
7,930
3,762
4,923
1,052
726
7,649
3,251
111,105'
4,891
45,029'
1,903
2,010
23,963
1,280
2,336
10
499
669
103
7,380
3,474
4,983
903
817
7,671
3,185
119,895
4,684
48,832
2,124
1,948
27,520
1,084
1,887
9
575
675
134
8,118
3,416
5,617
927
818
8,146
3,381
118,013
4,603
49,379
2,137
2,477
23,882
1,196
1,825
12
534
666
107
8,353
3,426
5,428
1,158
852
8,585
3,394
44
33,005
42,420
50,005
49,803
48,565
48,679
48,193
49,614'
52,524
50,202
49
1,393
1,672
527
504
707
8,907
993
795
277
15,300
1,879
49
1,662
2,548
416
730
883
16,281
1,528
919
464
14,453
2,487
158
2,082
3,950
385
640
592
20,750
2,013
874
534
13,174
4,854
216
2,568
4,957
439
757
612
16,830
1,927
736
365
14,053
6,344
214
2,769
4,847
507
534
705
15,680
1,776
768
349
14,396
6,020
203
2,716
4,465
433
849
606
16,098
1,692
770
629
13,433
6,784
220
3,139
4,542
514
1,156
608
15,836
1,473
680
482
12,332
7,210
196
3,515
4,988
962
614
515
16,613
1,458
787
529
11,672
7,764'
208
3,535
5,725
521
855
985
17,022
1,418
718
488
13,155
7,893
187
3,600
5,119
669
1,028
1,775
16,038
1,175
712
528
11,755
7,616
3,239
475
33
184
110
1,635
804
5,187
485
33
288
57
3,540
783
3,180
360
32
420
26
1,395
946
3,369
242
54
279
23
1,669
1,103
3,192
373
66
564
22
1,250
918
3,070
398
75
277
23
1,280
1,016
3,331
500
51
276
25
1,603
877
3,087
416
51
317
31
1,333
939
2,910
533
57
281
33
975
1,031
2,829
466
48
299
28
1,071
916
904
684
220
1,247
950
297
1,419
1,223
196
4,738
4,530
207
5,452
5,224
228
6,146
5,904
243
6,314
6,080
235
5,241
5,052
190
5,224
4,933
291
6,001
5,805
195
2,356
1,238
806
313
2,344
1,157
890
296
2,721
1,661
710
350
6,036
5,141
573
322
6,465
5,522
533
410
4,597
3,705
517
375
6,611
5,769
527
316
5,969
5,186
487
296
3,949
3,182
478
289
5,917
5,194
494
229
45
46
47
48
49
50
51
52
53
54
55
56
China
Mainland
Taiwan
Hong Kong
India
Indonesia
Israel
Japan
Korea
Philippines
Thailand
Middle-East oil-exporting countries3
Other Asia
57 Africa
58 Egypt
59 Morocco
60 South Africa
61 Zaire
62 Oil-exporting countries4
63 Other Africa
64 Other countries
65 Australia
66 All other
67 Nonmonetary international and regional
organizations
International
Latin American
regional
Other regional5
68
69
70
1. Includes the Bank for International Settlements. Beginning April 1978, also
includes Eastern European countries not listed in line 23.
2. Beginning April 1978 comprises Bulgaria, Czechoslovakia, the German
Democratic Republic, Hungary, Poland, and Romania.
3. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
4. Comprises Algeria, Gabon, Libya, and Nigeria.
5. Asian, African, Middle Eastern, and European regional organizations,
except the Bank for International Settlements, which is included in "Other
Western Europe."
• Liabilities and claims of banks in the United States were increased, beginning
in December 1981, by the shift from foreign branches to international banking
facilities in the United States of liabilities to, and claims on, foreign residents.
Nonbank-Reported
3.18
Data
A61
BANKS' OWN CLAIMS ON FOREIGNERS Reported by Banks in the United States
Payable in U.S. Dollars
Millions of dollars, end of period
1982
Area and country
1980
1979
1983
1981A
Nov.
Oct.
Dec.
Jan.
Feb/
Mar.
Aprs
1 Total
133,943
172,592
251,082
334,783
336,551
353,733
357,333
358,695
372,551
360,138
2 Foreign countries
133,906
172,514
251,026
334,728
336,494
353,665
357,260
358,618
372,482
360,046
28,388
284
1,339
147
202
3,322
1,179
154
1,631
514
276
330
1,051
542
1,165
149
13,795
611
175
268
1,254
32,108
236
1,621
127
460
2,958
948
256
3,364
575
227
331
993
783
1,446
145
14,917
853
179
281
1,410
49,067
121
2,851
187
546
4,124
938
333
5,240
682
384
529
2,100
1,205
2,213
424
23,654
1,224
209
377
1,725
78,358
173
4,965
396
813
6,219
1,522
335
7,346
1,285
544
1,018
3,558
2,799
1,636
603
41,661
1,248
266
242
1,728
79,190
197
5,395
406
904
6,627
1,756
373
7,708
1,122
650
924
3,643
2,804
1,516
598
40,868
1,261
380
227
1,832
84,005
216
5,115
554
990
6,863
1,860
452
7,498
1,428
572
943
3,730
3,030
1,639
560
44,754
1,418
378
263
1,741
83,503
232
4,730
609
984
7,204
1,407
576
7,544
1,470
625
843
3,699
3,113
1,568
527
44,703
1,382
310
233
1,745
84,289
226
5,363
648
957
7,367
1,740
632
7,005
1,356
587
834
3,223
2,693
1,496
567
45,916
1,399
319
250
1,709
88,028
255
5,700
1,134
961
7,216
1,810
652
7,125
1,629
544
820
3,120
2,414
1,668
595
48,671
1,393
322
310
1,690
83,347
307
5,348
1,124
844
7,222
1,271
628
7,373
1,247
628
797
3,004
2,289
2,362
608
44,533
1,432
232
392
1,706
3 Europe
4 Austria
5 Belgium-Luxembourg
6 Denmark
7 Finland
8 France
9 Germany
10 Greece
11 Italy
1? Netherlands
13 Norway
14 Portugal
IS Spain
16 Sweden
17 Switzerland
18 Turkey
19 United Kingdom
20 Yugoslavia
71 Other Western Europe 1
71 U.S.S.R
23 Other Eastern Europe 2
4,143
4,810
9,164
12,982
12,500
14,216
14,865
15,583
16,477
15,069
75 Latin America and Caribbean
7.6 Argentina
77 Bahamas
78 Bermuda
29 Brazil
30 British West Indies
31 Chile
3? Colombia
33 Cuba
34 Ecuador
35 Guatemala 3
36 Jamaica 3
37 Mexico
38 Netherlands Antilles
39 Panama
40 Peru
Uruguay
41
47 Venezuela
43 Other Latin America and Caribbean
67,993
4,389
18,918
496
7,713
9,818
1,441
1,614
4
1,025
134
47
9,099
248
6,041
652
105
4,657
1,593
92,992
5,689
29,419
218
10,496
15,663
1,951
1,752
3
1,190
137
36
12,595
821
4,974
890
137
5,438
1,583
138,138
7,522
43,446
346
16,914
21,930
3,690
2,018
3
1,531
124
62
22,409
1,076
6,779
1,218
157
7,069
1,844
180,564
11,019
51,848
602
22,999
28,270
5,276
2,838
3
2,057
111
151
29,422
685
10,286
2,244
572
9,925
2,257
180,902
10,816
52,207
957
22,978
27,370
5,091
2,895
3
2,101
140
218
29,558
731
10,516
2,252
609
10,250
2,211
187,379
10,960
56,300
603
23,204
29,162
5,560
3,185
3
2,053
124
181
29,449
814
10,133
2,332
681
10,682
1,953
192,024
11,231
58,003
582
23,036
32,790
5,229
3,221
11
2,038
129
206
29,422
815
10,040
2,299
687
10,225
2,057
192,002
11,431
56,654
536
23,377
33,376
5,302
3,159
2
2,054
119
197
30,234
906
9,296
2,273
684
10,283
2,117
198,501
11,264
59,354
506
23,555
35,212
5,209
3,167
2
2,054
84
216
31,251
970
9,797
2,301
707
10,615
2,236
195,728
11,223
57,200
385
23,712
34,958
5,130
3,148
0
2,084
77
196
31,709
1,037
8,951
2,329
859
10,537
2,193
44 Asia
China
45
Mainland
Taiwan
46
47 Hong Kong
48 India
49 Indonesia
50 Israel
51 Japan
52 Korea
53 Philippines
54 Thailand
55 Middle East oil-exporting countries 4
56 Other Asia
30,730
39,078
49,780
55,723
56,671
60,629
59,032
58,966
61,476
57,738
35
1,821
1,804
92
131
990
16,911
3,793
737
933
1,548
1,934
195
2,469
2,247
142
245
1,172
21,361
5,697
989
876
1,432
2,252
107
2,461
4,126
123
351
1,562
26,762
7,324
1,817
564
1,575
3,009
139
2,020
5,976
254
315
1,748
26,722
7,790
2,560
442
2,848
4,910
194
2,255
6,201
258
314
1,895
25,952
8,536
2,467
501
3,176
4,923
210
2,285
7,705
222
342
2,043
27,199
9,389
2,555
643
3,087
4,948
198
2,223
7,081
230
370
1,835
26,741
9,052
2,444
649
3,428
4,781
195
1,975
7,112
200
429
1,732
26,845
9,183
2,599
651
3,403
4,643
195
1,860
7,656
160
505
1,744
28,545
9,170
2,628
625
3,829
4,557
238
1,786
7,482
163
535
2,035
24,943
8,891
2,627
737
3,926
4,374
1,797
114
103
445
144
391
600
2,377
151
223
370
94
805
734
3,503
238
284
1,011
112
657
1,201
5,017
365
367
1,744
61
764
1,717
5,274
349
384
1,832
58
903
1,747
5,350
322
347
2,013
57
803
1,807
5,608
310
342
2,061
57
914
1,924
5,504
277
359
2,193
54
841
1,781
5,483
309
375
2,185
52
844
1,717
5,689
291
382
2,119
104
750
2,041
855
673
182
1,150
859
290
1,376
1,203
172
2,083
1,713
370
1,957
1,528
429
2,086
1,713
373
2,228
1,714
514
2,274
1,696
578
2,519
1,953
566
2,475
1,889
586
36
78
56
56
57
68
73
77
69
92
24 Canada
57 Africa
58 Egypt
59 Morocco
60 South Africa
61 Zaire
62 Oil-exporting countries 5
63 Other
64 Other countries
65 Australia
66 All other
67 Nonmonetary international and regional
organizations6
1. Includes the Bank for International Settlements. Beginning April 1978, also
includes Eastern European countries not listed in line 23.
2. Beginning April 1978 comprises Bulgaria, Czechoslovakia, the German
Democratic Republic, Hungary, Poland, and Romania.
3. Included in "Other Latin America and Caribbean" through March 1978.
4. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
5. Comprises Algeria, Gabon, Libya, and Nigeria.
6. Excludes the Bank for International Settlements, which is included in
"Other Western Europe."
NOTE. Data for period prior to April 1978 include claims of banks' domestic
customers on foreigners.
• Liabilities and claims of banks in the United States were increased,
beginning in December 1981, by the shift from foreign branches to international
banking facilities in the United States of liabilities to, and claims on, foreign
residents.
A62
3.19
International Statistics • June 1983
BANKS' OWN AND DOMESTIC CUSTOMERS' CLAIMS ON FOREIGNERS Reported by Banks in the
United States
Payable in U.S. Dollars
Millions of dollars, end of period
1982
Type of claim
1979
1980
1983
1981A
Nov.
Oct.
Dec.
Jan.
Feb/
Mar.
1 Total
154,030
198,698
287,051
2
3
4
5
6
7
8
133,943
15,937
47,428
40,927
6,274
34,654
29,650
172,592
20,882
65,084
50,168
8,254
41,914
36,459
251,082
31,302
96,647
74,134
23,012
51,123
48,999
20,088
955
26,106
885
35,968
1,378
39,909
2,226
38,051
1,939
13,100
15,574
26,352
30,627
29,230
6,032
9,648
8,238
7,056
6,882
18,021
22,714
29,517
38,391
35,311
22,333
24,468
39,862
Banks' own claims on foreigners
Foreign public borrowers
Own foreign offices1
Unaffiliated foreign banks
Deposits
Other
All other foreigners
9 Claims of banks' domestic customers2
393,642
334,783
42,429
117,329
114,464
42,165
72,299
60,561
336,551
42,296
118,060
115,123
41,227
73,896
61,073
353,733
44,601
127,275
119,327
43,012
76,315
62,530
Apr.?
410,602
357,333
44,360
133,589
116,434
42,160
74,274
62,950
358,695
45,423
134,460
117,731
44,133
73,598
61,081
372,551
46,938
143,684
121,008
48,626
72,382
60,921
360,138
47,512
135,425
116,633
44,257
72,376
60,568
11 Negotiable and readily transferable
12 Outstanding collections and other
13 MEMO: Customer liability on
Dollar deposits in banks abroad, reported by nonbanking business4 enterprises in the United States . . .
1. U.S. banks: includes amounts due from own foreign branches and foreign
subsidiaries consolidated in "Consolidated Report of Condition" filed with bank
regulatory agencies. Agencies, branches, and majority-owned subsidiaries of
foreign banks: principally amounts due from head office or parent foreign bank,
and foreign branches, agencies, or wholly owned subsidiaries of head office or
parent foreign bank.
2. Assets owned by customers of the reporting bank located in the United
States that represent claims on foreigners held by reporting banks for the account
of their domestic customers.
3. Principally negotiable time certificates of deposit and bankers acceptances.
3.20
46,884
45,717
40,967
38,263
38,608
37,614
n.a.
4. Includes demand and time deposits and negotiable and nonnegotiable
certificates of deposit denominated in U.S. dollars issued by banks abroad. For
description of changes in data reported by nonbanks, see July 1979 BULLETIN,
p. 550.
A Liabilities and claims of banks in the United States were increased,
beginning in December 1981, by the shift from foreign branches to international
banking facilities in the United States of liabilities to, and claims on, foreign
residents.
NOTE. Beginning April 1978, data for banks' own claims are given on a monthly
basis, but the data for claims of banks' own domestic customers are available on a
quarterly basis only.
BANKS' OWN CLAIMS ON UNAFFILIATED FOREIGNERS Reported by Banks in the United States
Payable in U.S. Dollars
Millions of dollars, end of period
1982
Maturity; by borrower and area
1 Total
2
3
4
5
6
7
By borrower
Maturity of 1 year or less1
Foreign public borrowers
All other foreigners
Maturity of over 1 year1
Foreign public borrowers
All other foreigners
By area
Maturity of 1 year or less1
Europe
Canada
Latin America and Caribbean
Asia
Africa 2
All other
Maturity of over 1 year1
14 Europe
15 Canada
16 Latin America and Caribbean
17
18 Africa 2
19 All other
8
9
10
11
12
13
1. Remaining time to maturity.
2. Includes nonmonetary international and regional organizations.
1979
1980
1983
1981A
June
Sept.
Dec.
Mar.P
86,181
106,748
153,879
200,596
213,223
225,853
226,429
65,152
7,233
57,919
21,030
8,371
12,659
82,555
9,974
72,581
24,193
10,152
14,041
115,849
15,099
100,750
38,030
15,650
22,380
151,698
19,367
132,331
48,898
20,057
28,841
161,686
20,057
141,629
51,537
21,925
29,612
171,852
20,999
150,852
54,001
22,883
31,118
171,000
21,597
149,404
55,429
24,553
30,875
15,235
1,777
24,928
21,641
1,077
493
18,715
2,723
32,034
26,686
1,757
640
27,914
4,634
48,489
31,413
2,457
943
39,064
6,594
68,046
33,518
3,259
1,217
44,880
7,039
71,686
33,297
3,621
1,163
49,232
7,554
72,922
37,226
3,692
1,225
52,859
6,794
73,588
32,538
3,862
1,359
4,160
1,317
12,814
1,911
655
173
5,118
1,448
15,075
1,865
507
179
8,094
1,774
25,089
1,907
899
267
9,244
2,340
32,919
2,479
1,295
622
10,510
1,955
34,020
3,088
1,328
635
11,559
1,923
35,121
3,168
1,491
740
11,924
1,924
35,574
3,531
1,480
995
A Liabilities and claims of banks in the United States were increased,
beginning in December 1981, by the shift from foreign branches to international
banking facilities in the United States of liabilities to, and claims on, foreign
residents.
Nonbank-Reported
3.21
Data
A63
CLAIMS ON FOREIGN COUNTRIES Held by U.S. Offices and Foreign Branches of U.S.-Chartered Banks'
Billions of dollars, end of period
1982'
1981
Area or country
1 Total
1979
303.9
1983
1980
352.0
Mar.
June
Sept.
Dec.
Mar.
June
Sept.
Dec.
Mar.P
372.1
382.9
399.8
414.4
417.7
432.6
434.5
436.3
433.6
173.6
13.6
15.7
12.2
9.7
3.8
4.7
5.0
69.0
10.8
29.0
177.3
13.0
16.7
12.6
10.3
3.6
5.0
5.0
71.0
29.0
178.1
13.5
16.5
12.9
10.2
4.3
4.2
4.6
72.0
10.7
29.2
138.4
11.1
11.7
12.2
6.4
4.8
2.4
4.7
56.4
6.3
22.4
162.1
13.0
14.1
12.1
8.2
4.4
2.9
5.0
67.4
8.4
26.5
168.5
13.6
14.5
13.3
7.7
4.6
3.2
5.1
68.5
8.9
29.1
168.3
13.8
14.7
12.1
8.4
4.2
3.1
5.2
67.0
10.8
28.9
172.2
14.1
16.0
12.7
8.6
3.7
3.4
5.1
68.8
11.8
28.0
175.2
13.3
15.3
12.9
9.6
4.0
3.7
5.5
69.9
10.9
30.1
173.7
13.2
15.9
12.5
9.0
4.0
4.0
5.3
69.8
11.6
28.4
175.0
14.1
16.4
12.7
9.0
4.1
4.0
5.1
68.5
11.3
29.8
13 Other developed countries
14 Austria
15 Denmark
16 Finland
17 Greece
18 Norway
19 Portugal
20 Spain
21 Turkey
22 Other Western Europe
23 South Africa
24 Australia
19.9
2.0
2.2
1.2
2.4
2.3
.7
3.5
1.4
1.4
1.3
1.3
21.6
1.9
2.3
1.4
2.8
2.6
.6
4.4
1.5
1.7
1.1
1.3
23.5
1.8
2.4
1.4
2.7
2.8
.6
5.5
1.5
1.8
1.5
1.5
24.8
2.1
2.3
1.3
3.0
2.8
.8
5.7
1.4
1.8
1.9
1.7
26.4
2.2
2.5
1.4
2.9
3.0
1.0
5.8
1.5
1.9
2.5
1.9
28.4
1.9
3.1
1.1
30.6
2.1
2.5
1.6
2.8
3.2
1.2
7.2
1.6
2.2
3.3
3.0
32.1
2.1
2.6
1.6
2.6
3.2
1.5
7.3
1.5
2.2
3.5
4.0
32.6
2.0
2.5
1.8
2.5
3.4
1.6
7.7
1.5
2.1
3.6
4.0
33.6
1.9
2.4
2.2
2.9
3.3
1.5
7.5
1.4
2.3
3.7
4.4
33.8
2.1
3.3
2.1
2.8
3.3
1.4
7.0
1.5
2.2
3.6
4.6
25 OPEC countries2
26 Ecuador
27 Venezuela
28 Indonesia
29 Middle East countries
30 African countries
22.9
1.7
8.7
1.9
8.0
2.6
22.7
2.1
9.1
1.8
6.9
2.8
21.7
2.0
8.3
2.1
6.7
2.6
22.2
2.0
8.8
2.1
6.8
2.6
23.5
2.1
9.2
2.5
7.1
2.6
24.5
2.2
9.7
2.5
7.5
2.5
25.1
2.3
9.7
2.7
8.2
2.2
26.1
2.4
9.8
2.8
8.7
2.5
27.0
2.3
10.1
2.9
9.0
2.7
27.4
2.2
10.6
3.2
8.7
2.8
28.4
2.2
10.3
3.5
9.3
3.1
31 Non-OPEC developing countries
63.0
77.4
82.2
84.8
90.2
96.2
97.5
103.6
103.9
106.7
107.0
5.0
15.2
2.5
2.2
12.0
1.5
3.7
7.9
16.2
3.7
2.6
15.9
1.8
3.9
9.5
17.0
4.0
2.4
17.0
1.8
4.7
8.5
17.5
4.8
2.5
18.2
1.7
3.8
9.3
17.7
5.5
2.5
20.0
1.8
4.2
9.4
19.1
5.8
2.6
21.6
2.0
4.1
9.9
19.7
6.0
2.3
22.9
1.9
4.1
9.7
21.3
6.4
2.6
25.1
2.5
4.0
9.2
22.4
6.2
2.8
24.9
2.6
4.3
8.9
22.8
6.3
3.0
24.4
2.6
4.0
9.0
22.9
6.0
3.0
24.6
2.4
4.3
2 G 10 countries and Switzerland
3 Belgium-Luxembourg
4 France
5 Germany
6 Italy
7 Netherlands
8 Sweden
9 Switzerland
10 United Kingdom
11 Canada
12 Japan
11.0
32
33
34
35
36
37
38
Latin America
Argentina
Brazil
Chile
Colombia
Mexico
Peru
Other Latin America
39
40
41
42
43
44
45
46
47
Asia
China
Mainland
Taiwan
India
Israel
Korea (South)
Malaysia
Philippines
Thailand
Other Asia
.1
3.4
.2
1.3
5.4
1.0
4.2
1.5
.5
.2
4.2
.3
1.5
7.1
1.1
5.1
1.6
.6
.2
4.4
.3
1.3
7.7
1.2
4.8
1.6
.5
.2
4.6
.3
1.8
8.8
1.4
5.1
1.5
.7
.2
5.1
.3
1.5
8.6
1.4
5.6
1.4
.8
.2
5.1
.3
2.1
9.4
1.7
6.0
1.5
1.0
.2
5.1
.5
1.7
8.6
1.7
5.9
1.4
1.2
.3
5.0
.5
2.2
8.9
1.9
6.3
1.3
1.1
.2
4.9
.5
1.9
9.3
1.8
6.0
1.3
1.3
.2
5.3
.6
2.3
10.8
2.1
6.2
1.6
1.1
.2
5.1
.4
2.0
10.8
2.5
6.6
1.6
1.3
48
49
50
51
Africa
Egypt
Morocco
Zaire
Other Africa3
.6
.6
.2
1.7
.8
.7
.2
2.1
.8
.6
.2
2.2
.7
.5
.2
2.1
1.0
.7
.2
2.2
1.1
.7
.2
2.3
1.3
.7
.2
2.3
1.3
.7
.2
2.3
1.3
.8
.1
2.2
1.2
.7
.1
2.4
1.1
.8
.1
2.3
52 Eastern Europe
53 U.S.S.R
54 Yugoslavia
55 Other
7.3
.7
1.8
4.8
7.4
.4
2.3
4.6
7.7
.4
2.4
4.8
7.7
.5
2.5
4.8
7.7
.4
2.5
4.7
7.8
.6
2.5
4.7
7.2
.4
2.5
4.3
6.7
.4
2.4
3.9
6.3
.3
2.2
3.8
6.2
.3
2.2
3.7
6.1
.3
2.5
3.3
56 Offshore banking centers
57 Bahamas
58 Bermuda
59 Cayman Islands and other British West Indies
60 Netherlands
Antilles
61 Panama4
62 Lebanon
63 Hong Kong
64 Singapore
65 Others5
40.4
13.7
.8
9.4
1.2
4.3
.2
6.0
4.5
.4
47.0
13.7
.6
10.6
2.1
5.4
.2
8.1
5.9
.3
53.7
15.5
.7
11.9
2.3
6.5
.2
8.4
7.3
.9
59.3
17.9
.7
12.6
2.4
6.9
.2
10.3
8.1
.3
61.7
21.3
.8
12.1
2.2
6.7
.2
10.3
8.0
.1
63.5
18.9
.7
12.4
3.2
7.6
.2
11.8
8.7
.1
65.3
19.9
.7
12.0
3.2
7.1
.2
12.9
9.3
.1
71.1
23.6
.7
12.2
3.0
7.3
.2
14.3
9.8
.1
71.0
20.8
.8
13.4
3.3
8.0
.1
14.9
9.8
.0
67.5
18.6
.9
13.2
3.3
7.5
.1
14.8
9.1
.0
64.5
16.8
1.0
11.5
3.2
6.8
.1
14.8
10.3
.0
66 Miscellaneous and unallocated6
11.7
14.0
14.9
15.7
18.2
18.8
18.3
18.2
20.1
17.6
16.2
1. The banking offices covered by these data are the U.S. offices and foreign
branches of U.S.-owned banks and of U.S. subsidiaries of foreign-owned banks.
Offices not covered include (1) U.S. agencies and branches of foreign banks, and
(2) foreign subsidiaries of U.S. banks. To minimize duplication, the data are
adjusted to exclude the claims on foreign branches held by a U.S. office or another
foreign branch of the same banking institution. The data in this table combine
foreign branch claims in table 3.14 (the sum of lines 7 through 10) with the claims
of U.S. offices in table 3.18 (excluding those held by agencies and branches of
foreign banks and those constituting claims on own foreign branches).
2. In addition to the Organization of Petroleum Exporting Countries shown
individually, this group includes other members of OPEC (Algeria, Gabon, Iran,
Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, and United Arab Emirates) as
well as Bahrain and Oman (not formally members of OPEC).
3. Excludes Liberia.
4. Includes Canal Zone beginning December 1979.
5. Foreign branch claims only.
6. Includes New Zealand, Liberia, and international and regional organizations.
A64
3.22
International Statistics • June 1983
LIABILITIES TO UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the
United States1
Millions of dollars, end of period
1981
Type, and area or country
1979
1980
1982
1981
Sept.
Dec.
Mar.
June
Sept.
Dec."
1 Total
17,433
22,226
22,480
23,608
22,480
22,393
20,965
21,440
21,795
2 Payable in dollars
3 Payable in foreign currencies
14,323
3,110
18,481
3,745
18,758
3,722
20,377
3,230
18,758
3,722
19,623
2,770
18,182
2,783
18,324
3,116
18,6%
3,099
By type
4 Financial liabilities
5 Payable in dollars
6 Payable in foreign currencies
7,523
5,223
2,300
11,330
8,528
2,802
12,117
9,446
2,671
13,084
10,688
2,396
12,117
9,446
2,671
12,599
10,627
1,972
10,028
8,066
1,961
10,707
8,399
2,308
10,253
8,178
2,075
7 Commercial liabilities
8 Trade payables
9 Advance receipts and other liabilities
9,910
4,591
5,320
10,896
4,993
5,903
10,363
4,720
5,643
10,524
4,430
6,094
10,363
4,720
5,643
9,794
4,022
5,773
10,937
5,027
5,910
10,733
4,527
6,206
11,542
4,471
7,071
9,100
811
9,953
943
9,312
1,052
9,689
835
9,312
1,052
8,9%
798
10,115
822
9,925
808
10,518
1,024
4,665
338
175
497
829
170
2,477
6,481
479
327
582
681
354
3,923
6,819
471
709
491
748
715
3,559
7,968
507
929
430
664
465
4,800
6,819
471
709
491
748
715
3,559
7,883
605
924
503
755
707
4,282
5,947
518
581
439
517
661
3,084
6,389
494
672
446
759
670
3,212
6,152
502
635
422
702
653
3,061
10
11
12
13
14
15
16
17
18
Payable in dollars
Payable in foreign currencies
By area or country
Financial liabilities
Europe
Belgium-Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
19
Canada
20
21
22
23
24
25
26
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
27
28
29
Asia
Japan
Middle East oil-exporting countries2
30
31
Africa
Oil-exporting countries3
32
33
34
35
36
3/
38
39
4
All other
Commercial liabilities
Europe
Belgium-Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
532
964
958
977
958
914
758
702
685
1,514
404
81
18
516
121
72
3,136
964
1
23
1,452
99
81
3,356
1,279
7
22
1,241
102
98
3,293
1,019
6
20
1,398
107
90
3,356
1,279
7
22
1,241
102
98
3,333
1,095
6
27
1,469
67
97
2,805
1,003
7
24
1,044
83
100
2,%9
933
14
28
981
85
104
2,683
866
23
28
992
121
114
804
726
31
723
644
38
957
792
75
814
696
51
957
792
75
455
293
63
502
340
66
631
424
67
718
527
70
4
1
11
1
3
0
3
1
3
0
2
0
3
0
3
0
4
0
4
15
24
29
24
12
11
13
12
3,709
137
467
545
227
316
1,080
4,402
90
582
679
219
499
1,209
3,771
71
573
545
221
424
880
3,963
79
575
590
239
569
925
3,771
71
573
545
221
424
880
3,422
50
504
473
232
400
824
3,742
47
700
457
248
412
850
3,861
50
759
436
281
358
904
3,578
50
602
464
340
335
802
40
Canada
924
888
897
853
897
884
1,116
1,188
1,482
41
42
43
44
45
46
47
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
1,325
69
32
203
21
257
301
1,300
8
75
111
35
367
319
1,044
2
67
67
2
340
276
1,137
3
113
61
11
392
273
1,044
2
67
67
2
340
276
817
22
71
83
27
210
194
1,418
20
102
62
2
727
219
1,220
6
48
128
3
484
269
1,127
16
89
65
32
475
157
48
49
50
Asia
Japan
Middle East oil-exporting countries2
2,991
583
1,014
3,034
802
890
3,285
1,094
910
3,221
775
881
3,285
1,094
910
3,404
1,090
998
3,298
1,064
958
3,207
1,134
821
3,966
1,028
1,538
51
52
Africa
Oil-exporting countries3
728
384
817
517
703
344
757
355
703
344
664
247
732
340
663
248
736
284
233
456
664
593
664
604
630
595
653
53
All other
4
1. For a description of the changes in the International Statistics tables, see
July 1979 BULLETIN, p. 550.
2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
3. Comprises Algeria, Gabon, Libya, and Nigeria.
4. Includes nonmonetary international and regional organizations.
Nonbank-Reported
3.23
CLAIMS ON UNAFFILIATED FOREIGNERS
United States1
Data
A65
Reported by Nonbanking Business Enterprises in the
Millions of dollars, e n d of period
1982
1981
Type, and area or country
1979
1980
1981
Sept.
Mar.
Dec.
June
Dec.''
Sept.
1 Total
31,299
34,482
35,672
34,170
35,672
30,203
30,483
29,488
27,153
2 Payable in dollars
3 Payable in foreign currencies
28,096
3,203
31,528
2,955
32,071
3,601
31,161
3,010
32,071
3,601
27,564
2,639
27,983
2,500
26,835
2,653
24,545
2,608
By type
4 Financial claims
Deposits
5
6
Payable in dollars
7
Payable in foreign currencies
8 Other financial claims
9
Payable in dollars
10
Payable in foreign currencies
18,398
12,858
11,936
923
5,540
3,714
1,826
19,763
14,166
13,381
785
5,597
3,914
1,683
20,742
14,688
14,057
631
6,054
3,600
2,454
19,171
13,611
12,876
734
5,561
3,867
1,694
20,742
14,688
14,057
631
6,054
3,600
2,454
17,748
12,730
12,267
463
5,018
3,362
1,656
18,360
13,603
13,229
374
4,757
3,189
1,568
17,714
12,608
12,194
413
5,106
3,419
1,687
16,432
11,918
11,552
366
4,514
2,833
1,681
11 Commercial claims
12 Trade receivables
13 Advance payments and other claims..
12,901
12,185
716
14,720
13,960
759
14,930
13,965
965
14,999
14,062
937
14,930
13,965
965
12,455
11,493
962
12,122
11,069
1,053
11,774
10,709
1,065
10,721
9,752
969
14
15
12,447
454
14,233
487
14,414
516
14,417
582
14,414
516
11,935
520
11,565
557
11,222
552
10,160
561
6,179
32
177
409
53
73
5,099
6,069
145
298
230
51
54
4,987
4,515
43
285
224
50
57
3,525
4,515
43
285
224
50
43
3,525
4,515
43
285
224
50
57
3,525
4,506
16
375
197
79
53
3,549
4,661
13
313
148
56
63
3,795
4,728
16
305
174
52
60
3,749
4,524
10
129
168
30
84
3,839
16
17
18
19
20
21
22
Payable in dollars
Payable in foreign currencies
By area or country
Financial claims
Europe
Belgium-Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
23
Canada
5,003
5,036
6,628
6,040
6,628
4,942
4,365
4,322
4,199
24
25
26
27
28
29
30
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
6,312
2,773
30
163
2,011
157
143
7,811
3,477
135
96
2,755
208
137
8,615
3,925
18
30
3,503
313
148
7,762
3,284
15
66
3,315
283
143
8,615
3,925
18
30
3,503
313
148
7,432
3,537
27
49
2,797
281
130
8,312
3,845
42
76
3,504
274
134
7,630
3,366
19
76
3,171
268
133
6,783
3,137
13
60
2,656
274
139
31
32
33
Asia
Japan
Middle East oil-exporting countries 2
601
199
16
607
189
20
762
366
37
501
113
29
762
366
37
670
257
36
800
327
33
825
247
30
736
191
15
34
Africa
258
49
208
26
173
46
169
41
173
46
164
43
156
41
165
50
158
48
44
32
48
116
48
34
66
44
31
4,922
202
727
593
298
272
901
5,544
233
1,129
599
318
354
929
5,359
234
776
557
303
427
969
5,378
220
767
582
308
404
1,034
5,359
234
776
557
303
427
969
4,381
246
698
452
227
354
1,062
4,273
211
636
392
297
384
905
4,164
178
646
427
278
258
1,035
3,658
152
465
341
364
328
765
859
914
967
1,017
967
943
713
666
635
3,479
12
223
668
12
1,022
424
2,925
80
212
417
23
762
396
2,787
30
225
423
10
750
383
2,772
19
154
481
7
869
373
2,376
21
259
252
9
672
342
35
36
37
38
39
40
41
42
43
44
Oil-exporting countries 3
All other 4
Commercial claims
Europe
Belgium-Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
45
46
47
48
49
50
51
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
2,879
21
197
645
16
708
343
3,766
21
108
861
34
1,102
410
3,479
12
223
668
12
1,022
424
3,734
18
241
726
13
985
456
52
53
54
Asia
Japan
Middle East oil-exporting countries 2
3,451
1,177
765
3,522
1,052
825
3,914
1,244
901
3,700
1,129
829
3,914
1,244
901
3,155
1,160
757
3,323
1,213
806
3,086
968
775
3,104
1,157
710
55
56
Africa
Oil-exporting countries 3
551
130
653
153
750
152
717
154
750
152
587
143
614
138
638
148
535
133
240
321
461
453
461
463
413
448
413
57
All other
4
1. For a description of the changes in the International Statistics tables, see
July 1979 BULLETIN, p. 550.
2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
3. Comprises Algeria, Gabon, Libya, and Nigeria.
4. Includes nonmonetary international and regional organizations.
A66
3.24
International Statistics • June 1983
FOREIGN TRANSACTIONS IN SECURITIES
Millions of dollars
1983
Transactions, and area or country
1981
1982
1983
1982
Jan.Apr.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.?
U.S. corporate securities
STOCKS
1 Foreign purchases
2 Foreign sales
40,686
34,856
41,902
37,948
23,460
20,195
5,967
5,675
3 Net purchases, or sales ( - )
5,830
3,954
3,265
292
336
971
765
961
928
611
4 Foreign countries
5,803
3,869
3,156
282
325
946
755
940
902
559
3,662
900
-22
42
288
2,235
783
-30
1,140
287
7
-46
2,596
-143
333
-60
-529
3,129
221
304
368
246
2
131
3,105
136
670
46
815
1,363
420
171
-417
-227
25
80
175
-30
47
-102
-118
435
5
142
-98
22
35
69
-8
26
-24
-208
317
72
54
9
112
2
7
672
43
138
25
226
242
154
39
-153
210
3
22
586
47
84
2
211
183
90
-5
-57
118
6
18
890
52
137
8
223
442
61
83
-13
-91
4
6
976
8
226
41
102
576
147
-23
-57
-210
8
60
653
29
222
-5
278
162
122
116
-290
-45
8
-4
27
85
108
10
11
25
10
21
26
52
17,304
12,252
21,631
20,480
8,508
8,620
2,778
2,961
2,099
2,280
2,099
2,457
1,933
2,278
1,885
1,877
2,312
2,448
2,378
2,018
20 Net purchases, or sales ( - )
5,052
1,151
-113
-183
-181
-358
-345
8
-136
360
21 Foreign countries
4,991
1,179
-88
-223
-190
-348
-343
33
-153
374
22
23
24
25
26
27
28
29
30
31
32
33
1,371
11
848
70
108
196
-12
132
3,465
44
-1
-7
1,848
295
2,116
28
161
-903
25
160
-821
-23
-19
7
-247
-38
43
19
318
-404
28
33
-128
211
-6
20
408
-17
187
-2
-4
225
-152
-15
-435
-30
0
-236
24
11
-4
-13
-327
10
28
-20
28
0
-189
-21
-96
16
29
-105
11
23
-211
23
0
-148
-2
-35
0
0
-158
146
43
-1
44
-461
-2
-6
-177
-5
0
-1
0
0
-266
-22
127
3
-2
-182
21
1
32
59
0
0
356
7
47
1
229
-27
-18
-2
-35
57
-5
21
61
-28
-25
41
10
-10
-2
-25
17
-14
5
6
7
8
9
10
11
12
13
14
15
16
Europe
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
Latin America
and Caribbean
Middle East1
Other Asia
Africa
Other countries
17 Nonmonetary international and
regional organizations
0
5,581
5,245
5,839
4,868
5,141
4,376
5,310
4,349
7,083
6,155
5,926
5,316
BONDS 2
18 Foreign purchases
19 Foreign sales
Europe
France
Germany
Netherlands
Switzerland.
United Kingdom
Canada
Latin America
and Caribbean
Middle East1
Other Asia
Africa
Other countries
34 Nonmonetary international and
regional organizations
0
62
-90
15
11
86
72
-1
Foreign securities
35 Stocks, net purchases, or sales ( - )
36 Foreign purchases
37 Foreign sales
-247
9,339
9,586
-1,340
7,170
8,511
-1,541
4,232
5,773
-308
706
1,014
-740
772
1,512
-272
927
1,199
-320
1,032
1,352
-226
1,042
1,268
-447
1,187
1,634
-548
971
1,519
38 Bonds, net purchases, or sales ( - )
39 Foreign purchases
40 Foreign sales
-5,460
17,553
23,013
-6,610
29,900
36,510
-1,459
11,609
13,068
-1,331
3,058
4,389
-458
2,953
3,411
-417
2,962
3,379
22
2,881
2,859
-278
3,526
3,804
-556
2,772
3,328
-646
2,430
3,076
41 Net purchases, or sales (-), of stocks and bonds . . . .
-5,707
-7,950
-3,000
-1,639
-1,199
-689
-298
-504
-1,003
-1,194
-4,694
-728
-3,697
69
-367
-55
84
-6,778
-2,436
-2,364
246
-1,851
-9
-364
-3,031
-2,284
-894
666
-597
58
20
-1,247
-517
-181
-268
-283
0
3
-1,168
-572
-7
-62
-536
4
5
-736
-555
-29
29
-195
4
10
-272
-307
-20
258
-192
-9
-2
-817
-687
-449
345
-37
21
-10
-714
-604
13
-24
-146
30
16
-1,227
-686
-438
87
-221
16
16
-1,012
-1,172
31
-392
-31
47
-26
312
-289
33
42
43
44
45
46
47
48
49
Foreign countries
Europe
Canada
Latin America and Caribbean
Africa
Other countries
Nonmonetary international and
regional organizations
1. Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, Kuwait,
Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial States).
2. Includes state and local government securities, and securities of U.S.
government agencies and corporations. Also includes issues of new debt securities sold abroad by U.S. corporations organized to finance direct investments
abroad.
Investment
3.25
MARKETABLE U.S. TREASURY BONDS AND NOTES
Transactions and Discount Rates
A67
Foreign Holdings and Transactions
Millions of dollars
1982
1983
1981
Country or area
1983
1982
Jan.Apr.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.P
Holdings (end of period)1
1 Estimated total2
70,249
85,169
83,860
84,667
85,169
85,458
86,057
88,675
87,511
2 Foreign countries2
64,565
80,586
79,166
79,447
80,586
80,854
82,098
83,046
84,025
3 Europe2
4 Belgium-Luxembourg
5 Germany2
6 Netherlands
7 Sweden
8 Switzerland2
9 United Kingdom
10 Other Western Europe
11 Eastern Europe
12 Canada
24,012
543
11,861
1,991
643
846
6,709
1,419
0
514
29,274
447
14,841
2,754
667
1,540
6,549
2,476
0
602
29,071
834
14,493
2,356
655
1,266
7,237
2,230
0
482
29,447
448
14,704
2,473
687
1,532
7,099
2,505
0
552
29,274
447
14,841
2,754
667
1,540
6,549
2,476
0
602
29,855
716
15,151
2,839
668
1,013
6,721
2,748
0
649
31,039
-87
16,650
3,011
681
1,039
6,941
2,804
0
639
32,364
-332
17,560
3,194
656
1,044
7,478
2,764
0
724
33,496
-107
17,791
3,228
656
1,063
7,736
3,130
0
696
13
14
15
16
17
18
19
20
736
286
319
131
38,671
10,780
631
2
1,076
188
656
232
49,502
11,578
77
55
1,086
204
657
225
48,288
11,396
178
61
1,231
172
759
300
48,079
11,314
77
62
1,076
188
656
232
49,502
11,578
77
55
1,067
190
720
156
49,146
11,655
77
60
1,050
74
792
185
49,256
11,707
80
34
951
77
690
184
48,897
11,736
80
31
932
72
676
184
48,782
11,850
80
39
5,684
5,638
1
4,583
4,186
6
4,694
4,417
-4
5,220
4,939
-4
4,583
4,186
6
4,604
4,165
6
3,959
3,405
6
5,629
4,966
6
3,486
2,969
6
Latin America and Caribbean
Venezuela
Other Latin America and Caribbean
Netherlands Antilles
Asia
Japan
Africa
All other
21 Nonmonetary international and regional organizations
22 International
23 Latin American regional
Transactions (net purchases, or sales ( - ) during period)
24 Total2
12,700
14,920
2,342
1,703
808
502
289
599
2,618
-1,163
25 Foreign countries2
26 Official institutions
27 Other foreign2
28 Nonmonetary international and regional organizations
11,604
11,730
-127
1,096
16,021
14,529
1,487
-1,096
3,439
2,843
596
-1,096
792
641
151
910
281
231
50
527
1,139
1,866
-727
-637
268
20
248
21
1,245
1,567
-323
-645
948
947
1
1,670
979
308
670
-2,142
MEMO: Oil-exporting countries
29 Middle4 East3
30 Africa
11,156
-289
7,534
-552
-917
0
209
0
-320
-100
303
0
121
0
-233
0
-691
0
-115
0
1. Estimated official and private holdings of marketable U.S. Treasury securities with an original maturity of more than 1 year. Data are based on a benchmark
survey of holdings as of Jan. 31,1971, and monthly transactions reports. Excludes
nonmarketable U.S. Treasury bonds and notes held by official institutions of
foreign countries.
3.26
2. Beginning December 1978, includes U.S. Treasury notes publicly issued to
private foreign residents denominated in foreign currencies.
3. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
4. Comprises Algeria, Gabon, Libya, and Nigeria.
DISCOUNT RATES OF FOREIGN CENTRAL BANKS
Percent per annum
Rate on May 31, 1983
Rate on May 31, 1983
Country
Country
Austria..
Belgium.
Brazil...
Canada..
Denmark
Percent
Month
effective
3.75
9.5
49.0
9.38
7.5
Mar. 1983
May 1983
Mar. 1981
May 1983
Apr. 1983
France1
Germany, Fed. Rep. of
Italy
Japan
Netherlands
1. As of the end of February 1981, the rate is that at which the Bank of France
discounts Treasury bills for 7 to 10 days.
2. Minimum lending rate suspended as of Aug. 20, 1981.
NOTE. Rates shown are mainly those at which the central bank either discounts
Rate on May 31, 1983
Country
Percent
Month
effective
12.5
4.0
17.0
5.5
4.5
Feb. 1983
Mar. 1983
Apr. 1983
Dec. 1981
May 1983
Norway
Switzerland
United Kingdom2.
Venezuela
Percent
Month
effective
9.0
4.0
Nov. 1979
Mar. 1983
13.0
Sept. 1982
or makes advances against eligible commercial paper and/or government 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 the
central bank transacts the largest proportion of its credit operations.
A68
International Statistics • June 1983
3.27
FOREIGN SHORT-TERM INTEREST RATES
Percent per annum, averages of daily figures
1982
Country, or type
1980
1981
Nov.
1 Eurodollars
2 United Kingdom
3 Canada
4 Germany
5 Switzerland
6
7
8
9
10
Netherlands
France
Italy
Belgium
Japan
1983
1982
Dec.
Jan.
Feb.
Mar.
Apr.
May
14.00
16.59
13.12
9.45
5.79
16.79
13.86
18.84
12.05
9.15
12.24
12.21
14.38
8.81
5.04
9.77
9.30
11.08
7.24
3.76
9.47
10.55
10.56
6.54
3.71
8.97
11.04
9.87
5.78
2.78
9.14
11.29
9.69
5.79
2.95
9.25
10.92
9.36
5.40
3.64
9.23
10.21
9.39
5.16
4.20
8.96
10.18
9.30
5.27
4.48
10.60
12.18
17.50
14.06
11.45
11.52
15.28
19.98
15.28
7.58
8.26
14.61
19.99
14.10
6.84
6.36
12.98
19.05
12.50
6.98
5.66
12.70
19.20
12.25
6.96
4.97
12.55
18.95
12.25
6.47
4.82
12.88
19.04
12.25
6.64
4.34
12.64
19.19
13.32
6.78
5.19
12.12
18.20
11.05
6.69
5.65
12.51
17.75
10.04
6.64
NOTE. Rates are for 3-month interbank loans except for Canada, finance company paper; Belgium, 3-month Treasury bills; and Japan, Gensaki rate.
3.28
FOREIGN EXCHANGE RATES
Currency units per dollar
1982
Country/currency
1980
1981
1983
1982
Dec.
Jan.
Feb.
Mar.
Apr.
May
1
2
3
4
5
6
7
8
9
10
Argentinaypeso 1
Australia/dollar
Austria/schilling
Belgium/franc
Brazil/cruzeiro
Canada/dollar
Chile/peso
China, P.R./yuan
Colombia/peso
Denmark/krone
n.a.
114.00
12.945
29.237
n.a.
1.1693
n.a.
n.a.
n.a.
5.6345
43883.91
n.a.
20985.00
48916.66
50239.47
62386.95
66868.56
71100.94
114.95
101.65
96.82
98.26
96.62
88.39
86.76
87.85
16.994
16.783
15.948
17.060
17.076
16.940
17.176
17.368
37.194
45.780
47.493
46.888
47.739
47.519
48.577
49.239
92.374
179.22
244.63
262.30
309.01
434.77
401.30
465.65
1.2344
1.2385
1.2287
1.1990
1.2277
1.2263
1.2325
1.2292
n.a.
51.118
72.630
74.257
76.863
76.378
76.028
75.405
1.9445
1.9238
1.7031
1.8978
1.9653
1.9834
1.9938
1.9895
n.a.
64.071
69.526
70.762
71.751
73.179
74.751
76.153
8.5275
8.4171
8.5811
7.1350
8.3443
8.6223
8.6663
8.8003
11
12
13
14
15
16
17
18
19
20
Finland/markka
France/franc
Germany/deutsche mark
Greece/drachma
Hong Kong/dollar
India/rupee
Indonesia/rupiah
Iran/rial
Ireland/pound1
Israel/shekel
3.7206
4.2250
1.8175
n.a.
n.a.
7.8866
n.a.
n.a.
205.77
n.a.
4.3128
5.4396
2.2631
n.a.
5.5678
8.6807
n.a.
79.324
161.32
n.a.
4.8086
6.5793
2.428
66.872
6.0697
9.4846
660.43
n.a.
142.05
24.407
5.3425
6.8548
2.4193
70.788
6.5417
9.6926
687.95
n.a.
137.69
32.966
5.3120
6.7725
2.3893
80.761
6.5252
9.7938
694.62
n.a.
139.16
34.863
5.3907
6.8855
2.4280
83.621
6.6060
9.9184
700.01
n.a.
136.81
36.986
5.4266
7.0204
2.4110
83.897
6.6536
9.9652
714.72
n.a.
134.79
38.867
5.4342
7.3148
2.4397
84.037
6.7868
9.9824
970.81
n.a.
129.53
40.951
5.4361
7.4163
2.4665
84.105
6.9667
9.9895
968.83
n.a.
128.11
43.427
21
22
23
24
25
26
27
28
29
30
Italyflira
Japan/yen
Malaysia/ringgit
Mexico/peso
Netherlands/guilder 1
New Zealand/dollar
Norway/krone
Peru/sol
Philippines/peso
Portugal/escudo
856.20
226.63
2.1767
22.968
1.9875
97.34
4.9381
n.a.
n.a.
50.082
1138.60
220.63
2.3048
24.547
2.4998
86.848
5.7430
n.a.
7.8113
61.739
1354.00
249.06
2.3395
72.990
2.6719
75.101
6.4567
694.59
8.5324
80.101
1398.74
241.94
2.3529
147.35
2.6698
72.569
7.0346
942.47
9.0546
92.685
1374.71
232.73
2.2822
150.75
2.6310
72.921
7.0447
1019.54
9.2632
94.548
1399.78
236.12
2.2757
157.81
2.6779
71.895
7.1171
1087.43
9.4488
93.771
1429.72
238.25
2.2898
161.78
2.6834
66.642
7.1852
1160.19
9.5896
95.867
1451.88
237.75
2.3063
153.77
2.7486
65.726
7.1460
1284.37
9.8449
99.055
1467.76
234.76
2.3009
150.27
2.7737
66.246
7.1154
1390.60
10.015
99.521
31
32
33
34
35
36
37
38
39
40
Singapore/dollar 1
South Africa/rand
South Korea/won
Spain/peseta
Sri Lanka/rupee
Sweden/krona
Switzerland/franc
Thailand/baht
United Kingdom/pound1
Venezuela/bolivar
n.a.
128.54
n.a.
71.758
16.167
4.2309
1.6772
n.a.
232.58
n.a.
2.1053
114.77
n.a.
92.396
5.0659
1.9674
21.731
202.43
4.2781
2.1406
92.297
731.93
110.09
20.756
6.2838
2.0327
23.014
174.80
4.2981
2.1522
92.03
746.36
126.125
21.166
7.3555
2.0588
23.000
161.60
4.2971
2.0768
93.82
749.80
126.844
21.378
7.3227
1.9679
23.000
157.56
4.2973
2.0758
91.04
752.19
129.886
22.355
7.4385
2.0180
22.999
153.29
4.3101
2.0854
91.64
757.94
133.498
22.982
7.4882
2.0663
22.991
149.00
7.9500
2.1010
91.42
765.29
135.99
22.971
7.4941
2.0587
22.990
153.61
9.0429
2.0920
92.31
767.96
137.76
22.970
7.4978
2.0572
22.988
157.22
10.233
102.94
116.57
119.22
117.73
119.70
120.71
121.82
122.05
18.967
MEMO:
United States/dollar2
87.39
1. Value in U.S. cents.
2. Index of weighted-average exchange value of U.S. dollar against currencies
of other G-10 countries plus Switzerland. March 1973 = 100. Weights are 1972-76
global trade of each of the 10 countries. Series revised as of August 1978. For
description and back data, see "Index of the Weighted-Average Exchange Value
of the U.S. Dollar: Revision" on page 700 of the August 1978 BULLETIN.
NOTE. Averages of certified noon buying rates in New York for cable tranfers.
A69
Guide to Tabular Presentation,
Statistical Releases, and Special Tables
GUIDE
TO TABULAR
Symbols and
c
e
p
r
*
PRESENTATION
Abbreviations
Corrected
Estimated
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)
General
0
n.a.
n.e.c.
IPCs
REITs
RPs
SMSAs
Calculated to be zero
Not available
Not elsewhere classified
Individuals, partnerships, and corporations
Real estate investment trusts
Repurchase agreements
Standard metropolitan statistical areas
Cell not applicable
Information
Minus signs are used to indicate (1) a decrease, (2) a negative
figure, or (3) an outflow.
"U.S. government securities" may include guaranteed
issues of U.S. government agencies (the flow of funds figures
also include not fully guaranteed issues) as well as direct
STATISTICAL
obligations of the Treasury. "State and local government"
also includes municipalities, special districts, and other political subdivisions.
In some of the tables details do not add to totals because of
rounding.
RELEASES
List Published Semiannually,
with Latest Bulletin
Reference
Issue
Page
June 1983 A76
Anticipated schedule of release dates for periodic releases
SPECIAL
TABLES
Published Irregularly,
Assets
Assets
Assets
Assets
Assets
Assets
Assets
Assets
and
and
and
and
and
and
and
and
liabilities
liabilities
liabilities
liabilities
liabilities
liabilities
liabilities
liabilities
of
of
of
of
of
of
of
of
with Latest Bulletin
commercial banks,
commercial banks,
commercial banks,
commercial banks,
U.S. branches and
U.S. branches and
U.S. branches and
U.S. branches and
Reference
March 31, 1982
June 30, 1982
September 30, 1982
December 31, 1982
agencies of foreign banks,
agencies of foreign banks,
agencies of foreign banks,
agencies of foreign banks,
March 31, 1982
June 30, 1982
September 30, 1982
December 31, 1982
July
October
January
April
July
October
January
April
1982
1982
1983
1983
1982
1982
1983
1983
A70
A70
A70
A70
A76
A76
A76
A76
A70
Federal Reserve Board of Governors
PRESTON MARTIN,
Chairman
Vice Chairman
OFFICE
MEMBERS
PAUL A . VOLCKER,
OF BOARD
JOSEPH R. COYNE, Assistant to the Board
DONALD J. WINN, Assistant to the Board
FRANK O ' B R I E N , JR., Deputy Assistant to the Board
ANTHONY F. COLE, Special Assistant to the Board
WILLIAM R. JONES, Special Assistant to the Board
WILLIAM R. MALONI, Special Assistant to the Board
NAOMI P. SALUS, Special Assistant to the Board
LEGAL
DIVISION
MICHAEL BRADFIELD, General Counsel
J. VIRGIL MATTINGLY, JR., Associate General Counsel
GILBERT T. SCHWARTZ, Associate General Counsel
RICHARD M. ASHTON, Assistant General Counsel
NANCY P. JACKLIN, Assistant General Counsel
MARYELLEN A. BROWN, Assistant to the General Counsel
OFFICE
OF THE
SECRETARY
WILLIAM W . W I L E S ,
Secretary
BARBARA R. LOWREY, Associate
Secretary
JAMES MCAFEE, Associate
Secretary
DIVISION OF CONSUMER
AND COMMUNITY
AFFAIRS
GRIFFITH L . G A R W O O D ,
Director
JERAULD C . K L U C K M A N , Associate
Director
G L E N N E . L O N E Y , Assistant
Director
DOLORES S . SMITH, Assistant
Director
DIVISION OF
SUPERVISION
BANKING
AND
REGULATION
JOHN E . R Y A N , Director
WILLIAM TAYLOR, Deputy
Director
FREDERICK R . D A H L , Associate
Director
D O N E . K L I N E , Associate
Director
JACK M . EGERTSON, Assistant
Director
ROBERT A . JACOBSEN, Assistant
Director
ROBERT S . PLOTKIN, Assistant
Director
THOMAS A . S I D M A N , Assistant
Director
S I D N E Y M . S U S S A N , Assistant
Director
S A M U E L H . TALLEY, Assistant
Director
L A U R A M . HOMER, Securities Credit Officer
HENRY C . WALLICH
J . CHARLES PARTEE
OFFICE OF STAFF DIRECTOR
MONETARY AND FINANCIAL
FOR
POLICY
STEPHEN H . A X I L R O D , Staff
E D W A R D C . E T T I N , Deputy
Director
Staff Director
STANLEY J. SIGEL, Assistant to the Board
NORMAND R.V. BERNARD, Special Assistant to the Board
DIVISION
OF RESEARCH
AND
STATISTICS
JAMES L . K I C H L I N E , Director
JOSEPH S . ZEISEL, Deputy
Director
MICHAEL J. PRELL, Senior Associate
Director
JARED J. E N Z L E R , Associate
Director
D O N A L D L . K O H N , Associate
Director
ELEANOR J. STOCKWELL, Associate
Director
D A V I D E . L I N D S E Y , Deputy Associate
Director
FREDERICK M . STRUBLE, Deputy Associate
Director
H E L M U T F . W E N D E L , Deputy Associate
Director
MARTHA B E T H E A , Assistant
Director
ROBERT M . FISHER, Assistant
Director
S U S A N J. LEPPER, Assistant
Director
THOMAS D . SIMPSON, Assistant
Director
LAWRENCE SLIFMAN, Assistant Director
STEPHEN P . TAYLOR, Assistant
Director
PETER A . TINSLEY, Assistant
Director
LEVON H . G A R A B E D I A N , Assistant
Director
(Administration )
DIVISION
OF INTERNATIONAL
FINANCE
E D W I N M . T R U M A N , Director
ROBERT F . G E M M I L L , Senior Associate
CHARLES J. S I E G M A N , Senior Associate
LARRY J. PROMISEL, Associate
Director
D A L E W . H E N D E R S O N , Deputy Associate
Director
Director
SAMUEL PIZER, Staff Adviser
MICHAEL P . DOOLEY, Assistant
Director
RALPH W . S M I T H , J R . , Assistant
Director
Director
A71
and Official Staff
N A N C Y H . TEETERS
LYLE E . GRAMLEY
EMMETT J. RICE
OFFICE OF
STAFF DIRECTOR
FOR
MANAGEMENT
S . D A V I D FROST, Staff Director
E D W A R D T . M U L R E N I N , Assistant
DIVISION
OF DATA
Staff Director
PROCESSING
CHARLES L . H A M P T O N , Director
BRUCE M . BEARDSLEY, Deputy
Director
G L E N N L . C U M M I N S , Assistant
Director
N E A L H . H I L L E R M A N , Assistant
Director
ELIZABETH A . JOHNSON, Assistant
Director
WILLIAM C . S C H N E I D E R , J R . , Assistant
Director
ROBERT J. Z E M E L , Assistant
Director
DIVISION
OF
PERSONNEL
D A V I D L . S H A N N O N , Director
Director
JOHN R . W E I S , Assistant
CHARLES W . W O O D , Assistant
Director
OFFICE
OF THE
CONTROLLER
GEORGE E . LIVINGSTON, Controller
B R E N T L . B O W E N , Assistant
Controller
DIVISION
OF SUPPORT
SERVICES
D O N A L D E . A N D E R S O N , Director
ROBERT E . FRAZIER, Associate
Director
WALTER W . K R E I M A N N , Associate
Director
OFFICE OF STAFF DIRECTOR FOR
FEDERAL RESERVE BANK
ACTIVITIES
THEODORE E. ALLISON, Staff Director
Equal Employment
Programs Adviser
JOSEPH W . D A N I E L S , S R . ,
DIVISION OF FEDERAL
BANK
OPERATIONS
Opportunity
RESERVE
C L Y D E H . FARNSWORTH, J R . , Director
LORIN S . M E E D E R , Associate
Director
D A V I D L . ROBINSON, Associate
Director
C . WILLIAM SCHLEICHER, J R . , Associate
Director
WALTER A L T H A U S E N , Assistant
Director
CHARLES W . B E N N E T T , Assistant
Director
A N N E M . D E B E E R , Assistant
Director
JACK D E N N I S , J R . , Assistant
Director
RICHARD B . G R E E N , Assistant
Director
EARL G . H A M I L T O N , Assistant
Director
ELLIOTT C . M C E N T E E , Assistant
Director
155
Federal Reserve Bulletin • June 1983
FOMC and Advisory Councils
FEDERAL
OPEN
MARKET
PAUL A . VOLCKER,
COMMITTEE
Chairman
ANTHONY M . SOLOMON,
LYLE E . GRAMLEY
ROGER GUFFEY
SILAS KEEHN
PRESTON MARTIN
FRANK E . MORRIS
J. CHARLES PARTEE
Staff Director and
STEPHEN H . AXILROD,
NORMAND R . V . BERNARD, Assistant
NANCY M . STEELE,
Deputy Assistant
MICHAEL BRADFIELD, General
Secretary
Secretary
Secretary
Counsel
JAMES H . OLTMAN, Deputy General Counsel
JAMES L . KICHLINE,
Economist
E D W I N M . TRUMAN, Economist
(International)
ANATOL BALBACH, Associate
Economist
PETER D . STERNLIGHT, Manager
SAM Y . CROSS, Manager for
FEDERAL
ADVISORY
EMMETT J. RICE
THEODORE H . ROBERTS
NANCY H . TEETERS
HENRY C . WALLICH
RICHARD G. DAVIS, Associate
Economist
THOMAS E. DAVIS, Associate
Economist
ROBERT EISENMENGER, Associate
Economist
EDWARD C. ETTIN, Associate
Economist
MICHAEL J. PRELL, Associate
Economist
KARL A. SCHELD, Associate
Economist
CHARLES J. SIEGMAN, Associate
Economist
JOSEPH S. ZEISEL, Associate
Economist
for Domestic Operations, System Open Market Account
Foreign Operations, System Open Market Account
COUNCIL
RONALD TERRY, Eighth
WILLIAM S. EDGERLY, First
District, President
District, Vice President
ROGER E. ANDERSON, Seventh District
E. PETER GILLETTE, JR., Ninth District
N. BERNE HART, Tenth District
T.C. FROST, JR., Eleventh District
JOSEPH J. PINOLA, Twelfth District
LEWIS T. PRESTON, Second District
JOHN H . WALTHER, Third District
JOHN G . MCCOY, Fourth District
VINCENT C . BURKE, JR., Fifth District
PHILIP F. SEARLE, Sixth District
HERBERT V . PROCHNOW,
WILLIAM J. KORSVIK, Associate
CONSUMER
ADVISORY
Secretary
Secretary
COUNCIL
SUSAN PIERSON D E WITT, Chicago, Illinois,
WILLIAM J. O'CONNOR, JR., Buffalo, New York,
ARTHUR F . BOUTON,
Little Rock, Arkansas
JAMES G. BOYLE, Austin, Texas
GERALD
THOMAS
Vice Chairman
R. CHRISTENSEN, Salt Lake City, Utah
L. CLARK, JR., New York, New York
JEAN A. CROCKETT, Philadelphia, Pennsylvania
JOSEPH N. CUGINI, Westerly, Rhode Island
MEREDITH FERNSTROM, New York, New York
ALLEN J. FISHBEIN, W a s h i n g t o n , D . C .
E.C.A. FORSBERG, SR., Atlanta, Georgia
LUTHER R. GATLING, New York, New York
RICHARD F . HALLIBURTON, Kansas City, Missouri
CHARLES C . HOLT, Austin, Texas
GEORGE S. IRVIN, Denver, Colorado
HARRY N. JACKSON, Minneapolis, Minnesota
Chairman
Vice Chairman
KENNETH V . LARKIN, San Francisco, California
TIMOTHY D. MARRINAN, Minneapolis, Minnesota
STANLEY L. MULARZ, Chicago, Illinois
WILLARD P. OGBURN, Boston, Massachusetts
ELVA QUIJANO, San Antonio, Texas
JANET J. RATHE, Portland, Oregon
JANET M. SCACCIOTTI, Providence, Rhode Island
GLENDA G . SLOANE, W a s h i n g t o n , D . C .
HENRY J. SOMMER, Philadelphia, Pennsylvania
NANCY Z . SPILLMAN, Los Angeles, California
WINNIE F. TAYLOR, Gainesville, Florida
MICHAEL M. V A N BUSKIRK, Columbus, Ohio
CLINTON WARNE, Cleveland, Ohio
FREDERICK T. WEIMER, Chicago, Illinois
A73
Federal Reserve Banks, Branches, and Offices
FEDERAL RESERVE BANK, Chairman
branch, or facility
Zip
Deputy Chairman
President
First Vice President
BOSTON*
02106
Robert P. Henderson
Thomas I. Atkins
Frank E. Morris
James A. Mcintosh
NEW YORK*
10045
John Brademas
Gertrude G. Michelson
M. Jane Dickman
Anthony M. Solomon
Thomas M. Timlen
Buffalo
14240
John T. Keane
PHILADELPHIA
19105
Robert M. Landis, Esq.
Nevius M. Curtis
Edward G. Boehne
Richard L. Smoot
CLEVELAND*
44101
J.L.Jackson
William H. Knoell
Clifford R. Meyer
Milton G. Hulme, Jr.
Karen N. Horn
William H. Hendricks
Steven Muller
William S. Lee, III
Edward H. Covell
Dr. Henry Ponder
Robert P. Black
Jimmie R. Monhollon
Cincinnati
Pittsburgh
45201
15230
RICHMOND*
23219
Baltimore
21203
Charlotte
28230
Culpeper Communications
and Records Center 22701
ATLANTA
Birmingham
Jacksonville
Miami
Nashville
New Orleans
30301
35283
32231
33152
37203
70161
CHICAGO*
60690
Detroit
48231
ST. LOUIS
63166
Little Rock
Louisville
Memphis
72203
40232
38101
MINNEAPOLIS
55480
Helena
KANSAS CITY
Denver
Oklahoma City
Omaha
DALLAS
El Paso
Houston
San Antonio
59601
64198
80217
73125
68102
75222
79999
77252
78295
SAN FRANCISCO
94120
Los Angeles
Portland
Salt Lake City
Seattle
90051
97208
84125
98124
Vice President
in charge of branch
Robert E. Showalter
Harold J. Swart
Robert D. McTeer, Jr.
Stuart P. Fishburne
Albert D. Tinkelenberg
William A. Fickling, Jr.
John H. Weitnauer, Jr.
Samuel R. Hill, Jr.
Joan W. Stein
Eugene E. Cohen
Robert C.H. Mathews, Jr.
Roosevelt Steptoe
William F. Ford
Robert P. Forrestal
John Sagan
Stanton R. Cook
Russell G. Mawby
Silas Keehn
Daniel M. Doyle
W.L. Hadley Griffin
Mary P. Holt
Richard V. Warner
William C. Ballard, Jr.
G. Rives Neblett
Theodore H. Roberts
Donald W. Moriarty, Jr.
William G. Phillips
John B. Davis, Jr.
Gene J. Etchart
E. Gerald Corrigan
Thomas E. Gainor
Paul H. Henson
Doris M. Drury
James E. Nielson
Christine H. Anthony
Robert G. Lueder
Roger Guffey
Henry R. Czerwinski
Gerald D. Hines
John V. James
Chester J. Kesey
Paul N. Howell
Carlos Zuniga
Robert H. Boykin
William H. Wallace
Caroline L. Ahmanson
Alan C. Furth
Bruce M. Schwaegler
John C. Hampton
Wendell J. Ashton
John W. Ellis
John J. Balles
John B. Williams
Fred R. HenCharles D. East
Patrick K. Barron
Jeffrey J. Wells
James D. Hawkins
William C. Conrad
John F. Breen
Randall C. Sumner
Robert F. McNellis
Wayne W. Martin
William G. Evans
Robert D. Hamilton
Joel L. Koonce, Jr.
J.Z. Rowe
Thomas H. Robertson
Richard C. Dunn
Angelo S. Carella
A. Grant Holman
Gerald R. Kelly
•Additional offices of these Banks are located at Lewiston, Maine 04240; Windsor Locks, Connecticut 06096; Cranford, New Jersey 07016;
Jericho, New York 11753; Utica at Oriskany, New York 13424; Columbus, Ohio 43216; Columbia, South Carolina 29210; Charleston, West
Virginia 25311; Des Moines, Iowa 50306; Indianapolis, Indiana 46204; and Milwaukee, Wisconsin 53202.
A74
Federal Reserve Board Publications
Copies are available from PUBLICATIONS SERVICES,
Mail Stop 138, Board of Governors of the Federal Reserve
System, Washington, D.C. 2 0 5 5 1 . When a charge is indicated, remittance should accompany request and be made
THE FEDERAL RESERVE
TIONS. 1974. 125 p p .
A N N U A L REPORT.
SYSTEM—PURPOSES
AND
FUNC-
payable to the order of the Board of Governors of the Federal
Reserve System. Remittance from foreign residents should
be drawn on a U.S. bank. Stamps and coupons are not
accepted.
e a c h . PART 2, 1971. 153 pp. and PART 3, 1973. 131 pp.
Parts 2 and 3, $1.00 each; 10 or more to one address, $.85
each.
FEDERAL RESERVE BULLETIN. Monthly. $ 2 0 . 0 0 per year or
$ 2 . 0 0 each in the United States, its possessions, Canada,
OPEN MARKET POLICIES A N D OPERATING PROCEDURES—
STAFF STUDIES. 1971. 218 pp. $2.00 each; 10 or more to
and Mexico; 10 or more of same issue to one address,
$ 1 8 . 0 0 per year or $ 1 . 7 5 each. Elsewhere, $ 2 4 . 0 0 per
year or $ 2 . 5 0 each.
REAPPRAISAL OF THE FEDERAL RESERVE DISCOUNT MECHANISM. Vol. 1. 1971. 2 7 6 p p . Vol. 2. 1971. 173 p p . Vol. 3.
BANKING AND MONETARY STATISTICS. 1 9 1 4 - 1 9 4 1 .
of Part I only) 1976. 6 8 2 pp. $ 5 . 0 0 .
BANKING
AND MONETARY
STATISTICS.
(Reprint
1941-1970.
A N N U A L STATISTICAL DIGEST
1971-75. 1976. 339 pp. $ 5.00 per copy.
pp. $ 1 0 . 0 0
pp. $ 1 2 . 0 0
pp. $ 1 0 . 0 0
pp. $ 2 0 . 0 0
pp. $ 1 0 . 0 0
1982. 239 pp. $ 6.50
per copy.
per copy.
per copy.
per copy.
per copy.
1981.
per copy.
FEDERAL RESERVE CHART BOOK. Issued four times a year in
February, May, August, and November. Subscription
includes one issue of Historical Chart Book. $7.00 per
year or $2.00 each in the United States, its possessions,
Canada, and Mexico. Elsewhere, $10.00 per year or
$3.00 each.
1977.
1978.
1980.
1981.
1981.
377
361
305
587
241
Issued annually in Sept. Subscription to the Federal Reserve Chart Book includes one
issue. $1.25 each in the United States, its possessions,
Canada, and Mexico; 10 or more to one address, $1.00
each. Elsewhere, $1.50 each.
HISTORICAL CHART BOOK.
SELECTED INTEREST A N D EXCHANGE RATES—WEEKLY SE-
Weekly. $ 1 5 . 0 0 per year or $ . 4 0 each in
the United States, its possessions, Canada, and Mexico;
10 or more of same issue to one address, $ 1 3 . 5 0 per year
or $ . 3 5 each. Elsewhere, $ 2 0 . 0 0 per year or $ . 5 0 each.
THE FEDERAL RESERVE A C T , as amended through December
1976, with an appendix containing provisions of certain
other statutes affecting the Federal Reserve System. 307
RIES OF CHARTS.
pp. $2.50.
REGULATIONS OF THE BOARD OF GOVERNORS OF THE F E D ERAL RESERVE SYSTEM.
REPORT OF THE JOINT TREASURY-FEDERAL RESERVE STUDY
OF THE U . S . GOVERNMENT SECURITIES MARKET. 1969.
48 pp. $.25 each; 10 or more to one address, $.20 each.
JOINT TREASURY-FEDERAL RESERVE STUDY OF THE GOVERNMENT SECURITIES MARKET; STAFF STUDIES—PART
1. 1970. 86 pp. $.50 each; 10 or more to one address, $.40
1972. 220 pp. Each Volume $3.00; 10 or more to one
address, $2.50 each.
THE ECONOMETRICS OF PRICE DETERMINATION
1976.
1,168 pp. $15.00.
1972-76.
1973-77.
1974-78.
1970-79.
1980.
one address, $1.75 each.
CONFER-
ENCE, October 30-31, 1970, Washington, D.C. 1972. 397
pp. Cloth ed. $ 5 . 0 0 each; 10 or more to one address,
$ 4 . 5 0 each. Paper ed. $ 4 . 0 0 each; 10 or more to one
address, $ 3 . 6 0 each.
FEDERAL RESERVE STAFF STUDY; WAYS TO MODERATE
FLUCTUATIONS IN HOUSING CONSTRUCTION. 1972. 4 8 7
pp. $ 4 . 0 0 each; 10 or more to one address, $ 3 . 6 0 each.
LENDING FUNCTIONS OF THE FEDERAL RESERVE BANKS.
1973. 271 pp. $3.50 each; 10 or more to one address,
$3.00 each.
IMPROVING THE MONETARY AGGREGATES: REPORT OF THE
ADVISORY COMMITTEE ON MONETARY STATISTICS.
1976. 43 pp. $1.00 each; 10 or more to one address, $.85
each.
A N N U A L PERCENTAGE RATE TABLES (Truth in Lending—
Regulation Z) Vol. I (Regular Transactions). 1969. 100
pp. Vol. II (Irregular Transactions). 1969. 116 pp. Each
volume $1.00; 10 or more of same volume to one
address, $.85 each.
FEDERAL RESERVE MEASURES OF CAPACITY AND CAPACITY
UTILIZATION. 1978. 40 pp. $1.75 each; 10 or more to one
address, $1.50 each.
THE BANK HOLDING COMPANY MOVEMENT TO 1978;
A
COMPENDIUM. 1978. 289 pp. $2.50 each; 10 or more to
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IMPROVING THE MONETARY AGGREGATES; STAFF PAPERS.
1978. 170 pp. $4.00 each; 10 or more to one address,
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1977 CONSUMER CREDIT SURVEY. 1978. 119 pp. $2.00 each.
FLOW OF F U N D S ACCOUNTS. 1 9 4 9 - 1 9 7 8 . 1979. 171 p p . $ 1 . 7 5
each; 10 or more to one address, $1.50 each.
1980. 68 pp. $1.50 each;
10 or more to one address, $1.25 each.
INTRODUCTION TO F L O W OF F U N D S .
PUBLIC POLICY A N D CAPITAL FORMATION.
1981. 3 2 6 p p .
$13.50 each.
N E W MONETARY CONTROL PROCEDURES: FEDERAL RESERVE STAFF S T U D Y , 1 9 8 1 .
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REPORT OF THE COMMITTEE OF EXPERTS ON SEASONAL
ADJUSTMENT TECHNIQUES. 1981. 55 pp. $2.75 each.
A75
Looseleaf; updated at least monthly. (Requests must be prepaid.)
Consumer and Community Affairs Handbook. $60.00 per
year.
Monetary Policy and Reserve Requirements Handbook.
$60.00 per year.
Securities Credit Transactions Handbook. $60.00 per year.
Federal Reserve Regulatory Service. 3 vols. (Contains all
three Handbooks plus substantial additional material.)
$175.00 per year.
Rates for subscribers outside the United States are as
follows and include additional air mail costs:
Federal Reserve Regulatory Service, $225.00 per year.
Each Handbook, $75.00 per year.
FEDERAL RESERVE REGULATORY SERVICE.
WELCOME TO THE FEDERAL RESERVE, DECEMBER 1982.
PROCESSING BANK HOLDING COMPANY A N D MERGER APPLICATIONS
SUSTAINABLE RECOVERY: SETTING THE STAGE, November
1982.
STAFF
STUDIES.-
Summaries
Only 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.
BELOW THE BOTTOM LINE: T H E U S E OF CONTINGENCIES
AND COMMITMENTS BY COMMERCIAL BANKS, b y B e n j a -
min Wolkowitz and others. Jan. 1982. 186 pp.
MULTIBANK HOLDING COMPANIES: RECENT EVIDENCE ON
COMPETITION A N D PERFORMANCE IN BANKING MAR-
KETS, by Timothy J. Curry and John T. Rose. Jan. 1982.
9 pp.
COSTS, SCALE ECONOMIES, COMPETITION, AND PRODUCT
MIX IN THE U . S . PAYMENTS MECHANISM, b y D a v i d B .
Humphrey. Apr. 1982. 18 pp.
DIVISIA
MONETARY
AGGREGATES:
COMPILATION,
DATA,
AND HISTORICAL BEHAVIOR, by William A. Barnett and
REMARKS BY CHAIRMAN PAUL A . VOLCKER, AT A N N U A L
H U M A N RELATIONS A W A R D DINNER, December 1982.
REMARKS BY CHAIRMAN PAUL A . VOLCKER, AT DEDICATION
CEREMONIES: FEDERAL RESERVE BANK OF SAN FRAN-
CISCO, March 1983.
RESTORING STABILITY. REMARKS BY CHAIRMAN PAUL A .
VOLCKER, April 1983.
Paul A. Spindt. May 1982. 82 pp.
THE COMMUNITY REINVESTMENT A C T AND CREDIT ALLO-
CATION, by Glenn Canner. June 1982. 8 pp.
INTEREST RATES A N D TERMS ON CONSTRUCTION LOANS AT
COMMERCIAL BANKS, by David F. Seiders. July 1982.
14 pp.
STRUCTURE-PERFORMANCE STUDIES IN BANKING: A N U P DATED SUMMARY AND EVALUATION, b y S t e p h e n A .
Rhoades. Aug. 1982. 15 pp.
FOREIGN SUBSIDIARIES OF U . S . BANKING ORGANIZATIONS,
CONSUMER
EDUCATION
Short pamphlets suitable for
copies available without charge.
PAMPHLETS
classroom
use.
Multiple
by James V. Houpt and Michael G. Martinson. Oct.
1982. 18 pp.
REDLINING:
RESEARCH
AND
FEDERAL
LEGISLATIVE
RE-
SPONSE, by Glenn B. Canner. Oct. 1982. 20 pp.
Alice in Debitland
Consumer Handbook to Credit Protection Laws
The Equal Credit Opportunity Act and . . . Age
The Equal Credit Opportunity Act and . . . Credit Rights in
Housing
The Equal Credit Opportunity Act and . . . Doctors,
Lawyers, Small Retailers, and Others Who May Provide
Incidental Credit
The Equal Credit Opportunity Act and . . . Women
Fair Credit Billing
Federal Reserve Glossary
Guide to Federal Reserve Regulations
How to File A Consumer Credit Complaint
If You Borrow To Buy Stock
If You Use A Credit Card
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
Monetary Control Act of 1980
Organization and Advisory Committees
Truth in Leasing
U.S. Currency
What Truth in Lending Means to You
BANK CAPITAL TRENDS AND FINANCING,
by
Samuel
H.
Talley. Feb. 1983. 19 pp.
FINANCIAL TRANSACTIONS WITHIN BANK HOLDING COMPA-
NIES, by John T. Rose and Samuel H. Talley, May 1983.
11 pp.
REPRINTS
Most of the articles
reprinted
do not exceed
12
pages.
Perspectives on Personal Saving. 8/80.
Federal Reserve and the Payments System: Upgrading
Electronic Capabilities for the 1980s. 2/81.
Survey of Finance Companies, 1980. 5/81.
Bank Lending in Developing Countries. 9/81.
The Commercial Paper Market since the Mid-Seventies. 6/82.
Applying the Theory of Probable Future Competition. 9/82.
International Banking Facilities. 10/82.
U.S. International Transactions in 1982. 4/83.
A76
ANTICIPATED
SCHEDULE
OF RELEASE
THE FEDERAL
RESERVE
SYSTEM1
Weekly
DATES FOR PERIODIC
Releases
RELEASES—BOARD
Approximate
release days
OF GOVERNORS
OF
Date or period
to which data refer
Aggregate Reserves of Depository Institutions and Monetary Base.
H.3 (502) [1.22]
Monday
Week ended previous
Wednesday
Actions of the Board; Applications and Reports. H.2 (501)
Friday
Week ended previous Saturday
Assets and Liabilities of Domestically Chartered and Foreign Related
Banking Institutions. H.8 (510) [1.25]
Wednesday
Wednesday, 2 weeks earlier
Changes in State Member Banks. K.3 (615)
Tuesday
Week ended previous Saturday
Factors AfiFecting Reserves of Depository Institutions and Condition
Statement of Federal Reserve Banks. H.4.1 (503) [1.11]
Friday
Week ended previous
Wednesday
Foreign Exchange Rates. H.10 (512) [3.28]
Monday
Week ended previous Friday
Money Stock Measures and Liquid Assets. H.6 (508) [1.21]
Friday
Week ended Wednesday of
previous week
Selected Borrowings in Immediately Available Funds of Large
Member Banks. H.5 (507) [1.13]
Thursday
Week ended Thursday of
previous week
Selected Interest Rates. H. 15 (519) [ 1.35]
Monday
Week ended previous Saturday
Weekly Consolidated Condition Report of Large Commercial Banks
and Domestic Subsidiaries. H.4.2 (504) [1.26, 1.27, 1.28, 1.29,
I.291]
Friday
Wednesday, 1 week earlier
Weekly Report of Assets and Liabilities of International Banking
Facilities. H. 14 (518)
Monday
Wednesday, 2 weeks earlier
Weekly Summary of Reserves and Interest Rates. H.9 (511)
Friday
Week ended previous
Wednesday; and week ended
Wednesday of previous week
Capacity Utilization: Manufacturing and Materials. G.3 (402) [2.11]
Mid month
Previous month
Changes in Status of Banks and Branches. G.4.5 (404)
1 st of month
Previous month
Consumer Installment Credit. G.19 (421) [1.56, 1.57]
14th working day
of month
2nd month previous
Monthly
Releases
Debits and Deposit Turnover at Commercial Banks. G.6 (406) [1.20]
12th of month
Previous month
Finance Companies. G.20 (422) [1.52, 1.53]
5th working day of
month
2nd month previous
Foreign Exchange Rates. G.5 (405) [3.28]
1st of month
Previous month
1. Release dates are those anticipated or usually met. However, please note that for some releases there is normally a certain variability because
of reporting or processing procedures. Moreover, for all series unusual circumstances may, from time to time, result in a release date being later
than anticipated.
The BULLETIN table that reports these data is designated in brackets.
All
Monthly
Releases—Continued
Approximate
release days
Date or period
to which data refer
Mid month
Previous month
Loan Commitments at Selected Large Commercial Banks. G.21 (423)
5th of month
2nd month previous
Loans and Securities at all Commercial Banks. G.7 (407) [1.23]
20th of month
Previous month
Major Nondeposit Funds of Commercial Banks. G.10 (411) [1.24]
20th of month
Previous month
Maturity Distribution of Outstanding Negotiable Time Certificates of
Deposit. G.9 (410)
24th of month
Last Wednesday of previous
month
Research Library—Recent Acquisitions. G.15 (417)
1st of month
Previous month
Selected Interest Rates. G.13 (415) [1.35]
3rd working day of
month
Previous month
Summary of Equity Security Transactions. G. 16 (418)
Last week of month Release date
Industrial Production. G.12.3 (414) [2.13]
Quarterly
Releases
Agricultural Finance Databook. E.15 (125)
End of March,
January, April, July, and
June, September,
October
and December
Flow of Funds: Seasonally adjusted and unadjusted. Z.l (780) [1.58,
1.59]
15th of February,
May, August,
and November
Geographical Distribution of Assets and Liabilities of Major Foreign
Branches of U.S. Banks. E.ll (121)
15th of March, June Previous quarter
September, and
December
Survey of Terms of Bank Lending. E.2 (111) [1.34]
15th of March, June February, May, August and
September, and
November
December
Semiannual
Previous quarter
Releases
Domestic Offices, Commercial Bank Assets and Liabilities
Consolidated Report of Condition. E.3.4 (113) [1.26, 1.27, 1.28]
May and November End of previous December
and June
Check Collection Services—Federal Reserve System. E.9 (119)
February and July
Country Exposure Lending Survey. E.16 (126)
May and November End of previous December
and June
List of OTC Margin Stocks. E.7 (117)
February, June and Release date
October
Previous 6 months
A78
Approximate
release days
Date or period
to which data refer
Aggregate Summaries of Annual Surveys of Security Credit
Extension. C.2 (101)
February
End of previous June
Bank Holding Companies and Subsidiary Banks (Domestic and
Foreign). C.6 (105)
March
Previous year
Bank Holding Companies and Subsidiary Banks (Domestic only).
C.5 (104)
March
Previous year
Annual
Releases
A79
Index to Statistical Tables
References
are to pages A3 through A68 although the prefix "A" is omitted in this index
ACCEPTANCES, bankers, 11, 26, 28
Agricultural loans, commercial banks, 19, 20, 21, 27
Assets and liabilities (See also Foreigners)
Banks, by classes, 18, 19-22,
Domestic finance companies, 39
Federal Reserve Banks, 12
Foreign banks, U.S. branches and agencies, 23,
Nonfinancial corporations, 38
Savings institutions, 30
Automobiles
Consumer installment credit, 42, 43
Production, 48, 49
BANKERS balances, 18, 19-21
(See also Foreigners)
Banks for Cooperatives, 35
Bonds (See also U.S. government securities)
New issues, 36
Rates, 3
Branch banks, 16, 22-23, 56
Business activity, nonfinancial, 46
Business expenditures on new plant and equipment, 38
Business loans (See Commercial and industrial loans)
CAPACITY utilization, 46
Capital accounts
Banks, by classes, 18
Federal Reserve Banks, 12
Central banks, 67
Certificates of deposit, 22, 28
Commercial and industrial loans
Commercial banks, 16, 18, 23, 27
Weekly reporting banks, 19-23, 24
Commercial banks
Assets and liabilities, 18, 19-22
Business loans, 27
Commercial and industrial loans, 16, 18, 23, 24, 27
Consumer loans held, by type, 42, 43
Loans sold outright, 22
Nondeposit fund, 17
Number, by classes, 18
Real estate mortgages held, by holder and property, 41
Time and savings deposits, 3
Commercial paper, 3, 26, 28, 39
Condition statements (See Assets and liabilities)
Construction, 46, 50
Consumer installment credit, 42, 43
Consumer prices, 46, 51
Consumption expenditures, 52, 53
Corporations
Profits and their distribution, 37
Security issues, 36, 66
Cost of living (See Consumer prices)
Credit unions, 30, 42, 43
(See also Thrift institutions)
Currency and coin, 5, 18
Currency in circulation, 4, 14
Customer credit, stock market, 29
DEBITS to deposit accounts, 15
Debt (See specific types of debt or securities)
Demand deposits
Adjusted, commercial banks, 15
Banks, by classes, 18, 19-22
Demand deposits—Continued
Ownership by individuals, partnerships, and
corporations, 25
Turnover, 15
Depository institutions
Reserve requirements, 8
Reserves and related items, 3, 4, 5, 13
Deposits (See also specific types)
Banks, by classes, 3, 18, 19-22, 30
Federal Reserve Banks, 4, 12
Turnover, 15
Discount rates at Reserve Banks and at foreign central
banks (See Interest rates)
Discounts and advances by Reserve Banks (See Loans)
Dividends, corporate, 37
EMPLOYMENT, 46, 47
Eurodollars, 28
FARM mortgage loans, 41
Federal agency obligations, 4, 11, 12, 13, 34
Federal credit agencies, 35
Federal finance
Debt subject to statutory limitation and types and
ownership of gross debt, 33
Receipts and outlays, 31, 32
Treasury financing of surplus, or deficit, 31
Treasury operating balance, 31
Federal Financing Bank, 31, 35
Federal funds, 3, 6, 19, 20, 21, 28, 31
Federal Home Loan Banks, 35
Federal Home Loan Mortgage Corporation, 35, 40, 41
Federal Housing Administration, 35, 40, 41
Federal Intermediate Credit Banks, 35
Federal Land Banks, 35, 41
Federal National Mortgage Association, 35, 40, 41
Federal Reserve Banks
Condition statement, 12
Discount rates (See Interest rates)
U.S. government securities held, 4, 12, 13, 33
Federal Reserve credit, 4, 5, 12, 13
Federal Reserve notes, 12
Federally sponsored credit agencies, 35
Finance companies
Assets and liabilities, 39
Business credit, 39
Loans, 19, 20, 21, 42, 43
Paper, 26, 28
Financial institutions
Loans to, 19, 20, 21
Selected assets and liabilities, 30
Float, 4
Flow of funds, 44, 45
Foreign banks, assets and liabilities of U.S. branches and
agencies, 23
Foreign currency operations, 12
Foreign deposits in U.S. banks, 4 12, 19, 20, 21
Foreign exchange rates, 68
Foreign trade, 55
Foreigners
Claims on, 56, 58, 61, 62, 63, 65
Liabilities to, 22, 55, 56-60, 64, 66, 67
A80
GOLD
Certificate account, 12
Stock, 4, 55
Government National Mortgage Association, 35, 40, 41
Gross national product, 52, 53
HOUSING, new and existing units, 50
INCOME, personal and national, 46, 52, 53
Industrial production, 46, 48
Installment loans, 42, 43
Insurance companies, 30, 33, 41
Interbank loans and deposits, 18
Interest rates
Bonds, 3
Business loans of banks, 27
Federal Reserve Banks, 3, 7
Foreign central banks and foreign countries, 67
Money and capital markets, 3, 28
Mortgages, 3, 40
Prime rate, commercial banks, 27
Time and savings deposits, 9
International banking facilities, 17
International capital transactions of United States, 54-67
International organizations, 58, 59-61, 64-67
Inventories, 52
Investment companies, issues and assets, 37
Investments (See also specific types)
Banks, by classes, 18, 30
Commercial banks, 3, 16, 18, 19-21
Federal Reserve Banks, 12, 13
Savings institutions, 30, 41
LABOR force, 47
Life insurance companies (See Insurance companies)
Loans (See also specific types)
Banks, by classes, 18, 19-22
Commercial banks, 3, 16, 18, 19-22, 23, 27
Federal Reserve Banks, 3, 4, 5, 7, 12, 13
Insured or guaranteed by United States, 40, 41
Savings institutions, 30, 41
MANUFACTURING
Capacity utilization, 46
Production, 46, 49
Margin requirements, 29
Member banks (See also Depository institutions)
Federal funds and repurchase agreements, 6
Reserve requirements, 8
Mining production, 49
Mobile home shipments, 50
Monetary and credit aggregates, 3, 13
Money and capital market rates (See Interest rates)
Money stock measures and components, 3, 14
Mortgages (See Real estate loans)
Mutual funds (See Investment companies)
Mutual savings banks, 9, 19-21, 30, 33, 41, 42, 43
(See also Thrift institutions)
NATIONAL defense outlays, 32
National income, 52
OPEN market transactions, 11
PERSONAL income, 53
Prices
Consumer and producer, 46, 51
Stock market, 29
Prime rate, commercial banks, 27
Producer prices, 46, 51
Production, 46, 48
Profits, corporate, 37
REAL estate loans
Banks, by classes, 19-21, 41
Rates, terms, yields, and activity, 3, 40
Savings institutions, 28
Type of holder and property mortgaged, 41
Repurchase agreements and federal funds, 6, 19, 20, 21
Reserve requirements, 8
Reserves
Commercial banks, 18
Depository institutions, 3, 4, 5, 13
Federal Reserve Banks, 12
U.S. reserve assets, 55
Residential mortgage loans, 40
Retail credit and retail sales, 42, 43, 46
SAVING
Flow of funds, 44, 45
National income accounts, 53
Savings and loan association, 9, 30, 41, 42, 43, 44
(See also Thrift institutions)
Savings deposits (See Time and savings deposits)
Securities (See specific types)
Federal and federally sponsored credit agencies, 35
Foreign transactions, 66
New issues, 36
Prices, 29
Special drawing rights, 4, 12, 54, 55
State and local governments
Deposits, 19, 20, 21
Holdings of U.S. government securities, 33
New security issues, 36
Ownership of securities issued by, 19, 20, 21, 30
Rates on securities, 3
Stock market, 29
Stocks (See also Securities)
New issues, 36
Prices, 29
TAX receipts, federal, 32
Thrift institutions, 3 (See also Credit unions, Mutual
savings banks, and Savings and loan associations)
Time and savings deposits, 3, 9, 15, 18, 19-22
Trade, foreign, 55
Treasury currency, Treasury cash, 4
Treasury deposits, 4, 12, 31
Treasury operating balance, 31
UNEMPLOYMENT, 47
U.S. government balances
Commercial bank holdings, 19, 20, 21
Treasury deposits at Reserve Banks, 4, 12, 31
U.S. government securities
Bank holdings, 18, 19-21, 33
Dealer transactions, positions, and financing, 34
Federal Reserve Bank holdings, 4, 12, 13, 33
Foreign and international holdings and transactions, 12,
33, 67
Open market transactions, 11
Outstanding, by type and ownership, 33
Ownership of securities issued by, 30
Rates, 3, 28
U.S. international transactions, 54-67
Utilities, production, 49
VETERANS Administration, 40, 41
WEEKLY reporting banks, 19-24
Wholesale (producer) prices, 46, 51
YIELDS (See Interest rates)
A81
The Federal Reserve System
Boundaries of Federal Reserve Districts and Their Branch Territories
LEGEND
"""" Boundaries of Federal Reserve Districts
Boundaries of Federal Reserve Branch
Territories
®
Federal Reserve Bank Cities
•
Federal Reserve Branch Cities
Federal Reserve Bank Facility
Q
Board of Governors of the Federal Reserve
System
@FedFRASER