Full text of Federal Reserve Bulletin : June 1993
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VOLUME 79 • NUMBER 6 • JUNE 1993 BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM, WASHINGTON, D . C . PUBLICATIONS COMMITTEE Joseph R. Coyne, Chairman • S. David Frost • Griffith L. Garwood • Donald L. Kohn • J. Virgil Mattingly, Jr. • Michael J. Prell • Richard Spillenkothen • Edwin M. Truman The Federal Reserve Bulletin is issued monthly under the direction of the staff publications committee. This committee is responsible for opinions expressed except in official statements and signed articles. It is assisted by the Economic Editing Section headed by S. Ellen Dykes, the Graphics Center under the direction of Peter G. Thomas, and Publications Services supervised by Linda C. Kyles. Table of Contents 569 RESERVE REQUIREMENTS: HISTORY, CURRENT PRACTICE, AND POTENTIAL REFORM Laws requiring banks and other depository institutions to hold a certain fraction of their deposits in reserve, in safe, secure assets, have been a part of our nation's banking history for many years. Over time, however, the rationale for these requirements has changed as the financial system has evolved and as knowledge about how reserve requirements affect this system has grown. This article reviews the basic concepts and current rules regarding reserve requirements; provides a history of reserve requirements in the United States, including recent experience with cuts in these requirements; and discusses proposals for reforming the system of reserve requirements in light of this recent experience and that of other countries that have reduced their requirements. 606 INDUSTRIAL PRODUCTION CAPACITY UTILIZATION FOR MARCH 1993 Industrial production was unchanged in March, after having shown strong gains since October; at 112.0 percent of its 1987 average, total industrial production was 4.1 percent above its year-ago level. Total industrial capacity utilization declined 0.2 percentage point, to 79.9 percent. 609 STATEMENT TO THE CONGRESS John P. LaWare, member, Board of Governors, discusses some of the factors influencing recent national and regional trends in bank lending as well as changes in the composition of banks' balance sheets and says that the steps that banks have taken in recent years to rebuild their balance sheets have been considerable and may well augur an increase in the availability of bank credit, before the Subcommittee on Economic Growth and Credit Formation of the House Committee on Banking, Finance and Urban Affairs, April 2, 1993. 590 INDUSTRIAL PRODUCTION, CAPACITY, AND CAPACITY UTILIZATION SINCE 1987 The Federal Reserve recently revised its index of industrial production and the related measures of capacity and utilization. Compared with the previous index, the revised index shows that manufacturing grew more slowly from 1987 until the onset of recession late in 1990 and then recovered more rapidly, albeit unevenly. The index of industrial capacity was also revised downward. Capacity utilization, the ratio of output to capacity, was about the same for most of 1987-91 as it was before the revision. However, the more rapid recovery of revised production from the trough and slower growth of revised capacity led to an upward revision of utilization in late 1992 and early 1993. AND 614 ANNOUNCEMENTS Publication of documents on market risk and bank capital by the Basle Committee on Banking Supervision. Issuance of final rule amending risk-based capital guidelines for state member banks and bank holding companies. Revisions to the staff commentary to Regulation Z. Revisions to the List of Marginable OTC Stocks and to the List of Foreign Margin Stocks. Release of quarterly table of factors to adjust interest income of section 20 companies. 617 LEGAL DEVELOPMENTS Various bank holding company, bank service corporation, and bank merger orders; and pending cases. A1 FINANCIAL AND BUSINESS STATISTICS These tables reflect data available as of April 28, 1993. A3 GUIDE TO TABULAR PRESENTATION A70 INDEX TO STATISTICAL TABLES A72 BOARD OF GOVERNORS AND STAFF A74 FEDERAL OPEN MARKET COMMITTEE AND STAFF; ADVISORY COUNCILS A76 FEDERAL RESERVE BOARD PUBLICATIONS A78 SCHEDULE OF RELEASE DATES FOR PERIODIC RELEASES A4 Domestic Financial Statistics A44 Domestic Nonfinancial Statistics A53 International Statistics A80 MAPS OF THE FEDERAL RESERVE SYSTEM A69 GUIDE TO STATISTICAL RELEASES AND SPECIAL TABLES A82 FEDERAL RESERVE BANKS, BRANCHES, AND OFFICES Reserve Requirements: History, Current Practice, and Potential Reform Joshua N. Feinman, of the Board's Division of Monetary Affairs, prepared this article. Jana Deschler and Christoph Hinkelmann provided research assistance. Laws requiring banks and other depository institutions to hold a certain fraction of their deposits in reserve, in very safe, secure assets, have been a part of our nation's banking history for many years. The rationale for these requirements has changed over time, however, as the country's financial system has evolved and as knowledge about how reserve requirements affect this system has grown. Before the establishment of the Federal Reserve System, reserve requirements were thought to help ensure the liquidity of bank notes and deposits, particularly during times of financial strains. As bank runs and financial panics continued periodically to plague the banking system despite the presence of reserve requirements, it became apparent that these requirements really had limited usefulness as a guarantor of liquidity. Since the creation of the Federal Reserve System as a lender of last resort, capable of meeting the liquidity needs of the entire banking system, the notion of and need for reserve requirements as a source of liquidity has all but vanished. Instead, reserve requirements have evolved into a supplemental tool of monetary policy, a tool that reinforces the effects of open market operations and discount policy on overall monetary and credit conditions and thereby helps the Federal Reserve to achieve its objectives. While useful as an auxiliary policy tool, reserve requirements also have important implications for the efficacy of the Federal Reserve's primary tool, open market operations. In the early 1980s, for example, when open market operations were geared toward fostering fairly precise, short-run control of narrowly defined money (Ml), reserve requirements were designed to help facilitate this control by establishing a relatively stable, contem- poraneous link between reserves and Ml deposits. Although the Federal Reserve is no longer pursuing this type of short-run control of money, reserve requirements still play an important role in the conduct of open market operations, which are now aimed at influencing general monetary and credit conditions by varying the cost and availability of reserves to the banking system. By helping to ensure a stable, predictable demand for reserves, reserve requirements better enable the Federal Reserve to achieve desired reserve market conditions by controlling the supply of reserves; in so doing, they help prevent potentially disruptive fluctuations in the money market. Reserve requirements are not costless, however. On the contrary, requiring depositories to hold a certain fraction of their deposits in reserve, either as cash in their vaults or as non-interest-bearing balances at the Federal Reserve, imposes a cost on the private sector equal to the amount of forgone interest on these reserves—or at least on the fraction of these reserves that banks hold only because of legal requirements and not because of the needs of their customers. The higher the level of reserve requirements, the greater the costs imposed on the private sector; at the same time, however, higher reserve requirements may smooth the implementation of monetary policy and damp volatility in the reserves market. The Federal Reserve could resolve this policy dilemma by paying interest on required reserves, or at least on the part of these reserves that banks would not hold were it not for legal requirements. Paying an explicit, market-based rate of return on these funds would effectively eliminate much of the costs of reserve requirements without jeopardizing the stable demand for reserves that is needed for open market operations and for the smooth functioning of the reserves market. The Federal Reserve Board has long supported legislation that would explicitly allow interest to be 570 Federal Reserve Bulletin • June 1993 paid on the balances that depositories are required to hold in reserve—though not on the cash they hold in their vaults, which is assumed to be held primarily to meet customer needs—but to no avail.1 Opposition has typically centered on the adverse implications such a move would have for Treasury revenue. If the Federal Reserve paid interest on required balances, its net earnings would decline, and because it turns the vast majority of its earnings over to the Treasury, the Treasury's revenues would decline as well. On the other hand, eliminating the costs of reserve requirements would remove one government-mandated impediment to deposittaking and lending through the banking system. Recently, the costs of depository intermediation have risen sharply because of higher deposit insurance premiums, stifFer capital requirements, more stringent standards for interbank lending, and other regulatory burdens. Much of these increased costs have likely been passed on to the customers of depositories in the forms of higher loan rates and lower deposit rates; paying interest on reserves would be one way of countering some of these government-mandated increases in costs. to maintain reserves against transaction deposits, which include demand deposits, negotiable order of withdrawal accounts, and other highly liquid funds.2 Reserves against these deposits can take the form either of currency on hand (vault cash) or balances at the Federal Reserve. The Federal Reserve may vary the percentage of transaction deposits that must be kept in reserve, but only within fairly narrow limits prescribed by law; requirements may also be imposed on certain types of nontransaction accounts, though again only within specified limits.3 At present, the required reserve ratio on nontransaction accounts is zero, while the requirement on transaction deposits is 10 percent, which is near the legal minimum. Most depositories are able to satisfy their entire reserve requirement with vault cash, which they hold primarily to meet the liquidity needs of their customers and would likely hold even in the absence of reserve requirements. For these institutions, reserve requirements are essentially costless. About 3,000 depositories, however, have vault cash holdings that are insufficient to satisfy their entire reserve requirement. To meet their requirements, these institutions must also maintain deposits, called required reserve balances, at the Federal Reserve. BASIC CONCEPTS AND CURRENT RULES OF RESERVE REQUIREMENTS Under current regulations, all depository institutions—commercial banks, savings banks, thrift institutions, and credit unions—are required 1. See, for example, "Statement by Arthur F. Burns, Chairman, Board of Governors of the Federal Reserve System, before the Subcommittee on Financial Institutions of the Committee on Banking, Housing, and Urban Affairs, U.S. Senate, June 20, 1977," Federal Reserve Bulletin, vol. 63 (July 1977), pp. 636-43; "Statement by J. Charles Partee, member, Board of Governors, before the Subcommittee on Financial Institutions Supervision, Regulation and Insurance of the Committee on Banking, Finance and Urban Affairs, U.S. House of Representative, October 27, 1983," Federal Reserve Bulletin, vol. 69 (November 1983), pp. 840-52; and "Statement by Alan Greenspan, 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, February 19, 1992," Government Printing Office, Serial No. 102-98 (1992) pp. 42-43. The Federal Reserve has also requested the lifting of the prohibition on the payment of interest on demand deposits. See, in particular, the statement by J. Charles Partee, October 27, 1983. Reserve Requirements as a Tax Some uncertainty exists as to whether the Federal Reserve Act permits interest to be paid on reserves. In fact, the Federal Reserve has never actually paid 2. For a formal definition of depository institutions and transaction accounts, see Federal Reserve Regulation D (Reserve Requirements of Depository Institutions), sections 204.1 and 204.2. 3. At present, required reserve ratios may be set between 8 percent and 14 percent on transaction accounts in excess of $46.8 million, and between 0 and 9 percent on nonpersonal savings deposits, nonpersonal time deposits with original maturities of eighteen months or longer, and net Eurocurrency liabilities. Transaction deposits of less than $46.8 million, in the so-called low reserve tranche, are reservable at 3 percent, while the first $3.8 million of transaction deposits at each depository are exempt from reserve requirements altogether. The Federal Reserve cannot alter the cutoffs for the low reserve tranche or the exemption, which are adjusted each year according to a formula provided by law. Reserve Requirements: History, Current Practice, and Potential Reform interest on required reserve balances.4 Requiring depositories to hold idle, non-interest-bearing balances is essentially like taxing these institutions in an amount equal to the interest they could have earned on these balances in the absence of reserve requirements. This forgone interest, or reserve "tax," directly affects only the depository system and its customers, and not other parts of the financial system. Hence, it creates an artificial incentive for depositors and borrowers to bypass the depository system, and in so doing it may redirect credit flows in ways that impair the efficiency of resource allocation. In particular, by distorting the relative price of transaction accounts at depositories, the reserve tax may induce a smaller level of transaction services than what would be ideal for the functioning of the economy. The reserve tax also creates an incentive for depositories to expend resources trying to minimize required reserves by fashioning new financial products aimed solely at delivering transactions services without creating reservable liabilities. As is true for most taxes, determining precisely who bears the burden of the reserve tax is difficult. That determination depends in a complicated way on the degree of competitive pressure in the markets for deposits and loans and the associated sensitivities of borrowers, lenders, and depositories to changes in prices and interest rates. One thing is certain, however: Depositories and their shareholders do not bear all of the costs but rather pass at least some of them on to their customers in the forms of lower deposit rates and higher loan rates. In compensating-balance arrangements, for example, in which customers maintain non-interestbearing deposits as compensation for bank services, the customers typically "pay" the reserve tax by holding additional balances. Similarly, to the extent that some borrowers, such as small and 4. The Federal Reserve Board has, however, at least in the past, taken the position that it has the discretion to pay interest on reserves, though individual members of the Congress opposed such payments at the time of the enactment of the Federal Reserve Act in 1913 and again as recently as 1978. For details on a Federal Reserve proposal to pay interest on required reserve balances in 1978, see Federal Reserve Bulletin, vol. 64 (July 1978), pp. 605-10. For congressional reaction to this proposal, see, "Monetary Control and the Membership Problem," Hearings before the Committee on Banking, Finance and Urban Affairs on H.R. 13476, H.R. 13477, H.R. 12706, and H.R. 14072, 95 Cong. 2 Sess. U.S. House of Representatives (GPO, 1978), p. 781. 571 medium-sized businesses, have few alternatives outside of the depository system, these borrowers may ultimately bear some of the burden of the reserve tax in the form of higher costs of credit. Current Estimates of the Reserve Tax Table 1 presents estimates of the current dollar magnitude of the reserve tax. In the fourth quarter of 1992, the required reserve balances of all depositories totaled $23 V2 billion. Because many of the financial transactions in our economy flow through these reserve accounts, even in the absence of reserve requirements depositories would likely hold some balances at the Federal Reserve as a buffer against the normal uncertainties surrounding payment flows. Thus, $23 V2 billion should be considered an upper bound on the amount of balances truly idled by reserve requirements in the fourth quarter of 1992. Even if banks had invested all of these funds, moreover, the gains would probably not have been large because short-term interest rates are currently at relatively low levels. Using a federal funds rate of 3 percent as a proxy for the potential earnings rate on idle balances, the lost interest income due to reserve requirements totals only about $700 million, at an annual rate, based on $23 V2 billion of balances. About $600 million of this would have accrued to commercial banks and their customers; even in the unlikely event that banks were able to retain all of this increased revenue, it would have boosted their pretax return on assets for 1992 by only about 2 basis points compared with an actual pretax rate of return on assets of a little more than 130 basis points. On an after-tax basis, the earnings would be even smaller because depositories and their customers would have to pay extra taxes on this additional income. Regardless of the precise figure, however, 1. Burden of reserve requirements, 1992:Q4 Billions of dollars Type of institution Required reserve balances Forgone interest All depositories 23.5 .7 Commercial banks Thrift institutions 21.1 2.4 .6 .1 1. Forgone interest is annualized, based on a federal funds rate of 3 percent. 572 Federal Reserve Bulletin • June 1993 if the Federal Reserve paid interest on all required reserve balances, the private sector would enjoy a net increase in after-tax income, whereas the Treasury would see its net revenues reduced. Of course, if interest rates were higher, the burden of reserve requirements and the private-sector cost savings and government revenue losses stemming from paying interest on required reserve balances would be commensurately larger than the amounts shown in table 1. The distortions to resource allocation would be more pronounced as well. Indeed, the burden of reserve requirements has, at times, been considerably larger than it is now, as a result of both higher interest rates and higher reserve requirements. Because reserve requirements are a tax on the private sector that may distort the optimal allocation of resources in the financial sector, the question arises as to why these requirements were imposed in the first place. The next section traces the historical evolution of reserve requirements and their rationales to see how our current system developed. Subsequently, several options for reforming the current system to eliminate the reserve tax without jeopardizing the effective conduct of monetary policy are analyzed. HISTORICAL REVIEW OF RESERVE REQUIREMENTS AND THEIR RATIONALES Reserve requirements have played a part in our nation's financial system from the earliest days— long before the creation of a national currency or a central bank. Early State Laws and Practices The first commercial banks in this country were chartered by the states and were not required to keep reserves either against deposits, which were little used at the time, or against their own, more ubiquitous, bank notes. In the absence of a national currency, bank notes were commonly used as a medium of exchange, though high transaction costs of redeeming the notes and limited information about the underlying solvency of the issuer generally confined the use of any individual bank's notes to a small geographic area. To facilitate the more widespread use of their notes, banks in New York and New England entered into voluntary redemption arrangements as early as 1820. Under these arrangements, one bank agreed to redeem another bank's notes at par, provided that the issuing bank maintained a sufficient deposit of specie (gold or its equivalent) on account with the redeeming bank as backing for the notes. In essence, these deposits represented the first required reserves. The primary purpose of these reserves was to increase the liquidity of bank notes by ensuring their convertibility into specie. Although in subsequent years some states began to require banks to maintain reserves against their notes, and a few even began to require reserves against deposits, most states still had no legal reserve requirements when the Civil War broke out in 1861. The National Bank Era Reserve requirements were first established at the national level in 1863 with the passage of the National Bank Act. This act provided banks an opportunity to organize under a national charter and created a network of institutions whose notes could circulate more easily throughout the country. In exchange for this charter, banks had to hold a 25 percent reserve against both notes and deposits—a much higher requirement than that faced by most state banks. Although banks in "redemption" cities—designated in the act as cities where notes were likely to accumulate for redemption—had to hold reserves entirely in the form of "lawful" money (specie or greenbacks), banks outside these cities could maintain 60 percent of their reserves in interest-bearing balances at banks in redemption cities. Reserve requirements were seen as necessary for ensuring the liquidity of national bank notes and thereby reinforcing their acceptability as a medium of exchange throughout the country. Concentrating reserves in areas where demands for liquidity were likely to be most acute was thought to be the surest means of promoting the widespread use and acceptance of national bank notes. At the same time, allowing banks outside redemption cities to earn interest on a portion of their reserves made the burden of reserve requirements less onerous for banks that faced more limited demands for liquidity. Reserve Requirements: History, Current Practice, and Potential Reform The federal government had a keen interest in seeing the use of national bank notes flourish because, in addition to reserve requirements, national bank notes were also required to be backed by holdings of government bonds, which were needed to finance the Civil War. To make the issuance of national bank notes less costly, reserve requirements against these notes were lowered for banks outside redemption cities from 25 percent to 15 percent in 1864, and banks in redemption cities outside New York City were allowed to meet half of their requirements with interest-bearing balances at a bank in New York. Still dissatisfied with the rate of growth of national bank notes, the Congress imposed a tax on state bank notes in 1865, effectively guaranteeing the primacy of national bank notes as a medium of exchange. Indeed, in subsequent years, these notes began to circulate widely throughout the country and were rarely redeemed. With their convertibility no longer in question, reserve requirements against national bank notes were lifted in 1873. Requirements remained in place on deposits, however, which were just emerging as an accepted means of payment. As time wore on, the role of deposits expanded, and they eventually supplanted bank notes as the preferred medium of exchange for many transactions, with their convertibility supposedly reinforced by reserve requirements. A series of bank runs and financial panics in the late nineteenth and early twentieth centuries made it patently clear that reserve requirements could not really guarantee the convertibility of deposits for the entire banking system. In fact, reserve requirements were really no help at all in providing liquidity during a panic because a given dollar of reserves could not be used simultaneously to meet a customer's demand for cash and to satisfy reserve requirements. What was lacking from the national banking system or, for that matter, from any fractional reserve system—one with reserve requirements of less than 100 percent—was a mechanism for accommodating temporary variations in the public's demand for liquidity by adjusting the quantity of reserves available to the entire banking system. Absent such a mechanism, systemic panics and crises stemming from fluctuating liquidity needs were all too common. Though an individual bank might be able to meet a temporary surge in the demand for cash with little attendant adverse 573 effect on the economy, the banking system as a whole could not without selling securities or calling in loans, thereby squeezing credit supplies, driving up interest rates, and precipitating a general financial crisis. Creation of the Federal Reserve System The Federal Reserve Act of 1913 created a system of Reserve Banks that could act as lenders of last resort by accommodating the temporary liquidity needs of the banking system and thereby alleviating the periodic financial disruptions that plagued the national bank era. By discounting eligible assets of member banks, Federal Reserve Banks provided a ready, accessible source of liquidity that had been missing from the national banking system. Although the creation of the Federal Reserve System seemingly eliminated any remaining liquidity rationale for reserve requirements, banks that were members of the System were still required to hold reserves, though requirements were lower than those previously in effect for most national banks. In the original Federal Reserve Act, banks had to hold in reserve different percentages of their demand deposits—deposits that could be withdrawn on demand—depending on whether they were classified as central reserve city banks (18 percent), reserve city banks (15 percent), or country banks (12 percent).5 In addition, all member banks faced a 5 percent requirement on time deposits.6 Member banks outside central reserve cities were not allowed, however, to meet part of their requirements with interest-bearing balances at a bank in a central reserve city. Starting in 1917, moreover, member banks could no longer use vault cash to satisfy reserve requirements: They had to 5. Originally, the rationale for these distinctions among cities was a carryover from the designation of redemption cities in the national bank era. In 1913, banks in New York, Chicago, and St. Louis were classified as central reserve city banks, and banks in about fifty other cities were designated as reserve city banks. In 1922, St. Louis was reclassified as a reserve city, and in 1962 the central reserve city designation was eliminated altogether. Over the years, the number of reserve cities changed somewhat as some cities were added and others deleted by the Federal Reserve Board. 6. For details on the history of changes in reserve requirements since the inception of the Federal Reserve, see the appendix. 574 Federal Reserve Bulletin • June 1993 meet their requirements entirely with non-interestbearing balances at a Federal Reserve Bank. On net, therefore, the effective burden of reserve requirements in terms of forgone interest was somewhat higher for member banks than for nonmember banks, particularly for those outside central reserve cities. To help offset this increased burden, in 1917 reserve requirements on demand deposits were pared further, to 13 percent, 10 percent, and 7 percent respectively for the three types of member banks, and requirements on time deposits were reduced from 5 percent to 3 percent for all members. These reductions, coupled with the benefits of access to Federal Reserve credit at the discount window and free Federal Reserve services— such as check clearing and currency distribution— were considered sufficient encouragement for banks to become members of the System, despite the higher reserve requirement burden that such membership often entailed. In later years, however, the burden of reserve requirements would become more acute, making membership less desirable for many institutions. Reserve Requirements as a Means of Influencing Credit Conditions In the 1920s and 1930s, the Federal Reserve gradually began to expand its original, reactive role as lender of last resort and guarantor of the liquidity of the banking system and adopted a more proactive posture in attempting to influence the nation's credit conditions. As the emphasis of monetary policy evolved, so too did the rationale for reserve requirements. In fact, by 1931, the Federal Reserve had officially abandoned the view that reserves were a necessary or useful source of liquidity for deposits, arguing instead that reserve requirements provided a means for influencing the expansion of bank credit.7 Specifically, the Federal Reserve believed that requiring banks to hold reserves against the additional deposits needed to fund each increment of new loans could help restrain an overly rapid expansion of credit. 7. See "Member Bank Reserves—Report of the Committee on Bank Reserves of the Federal Reserve System," in Board of Governors of the Federal Reserve System, 19th Annual Report, 1932 (Board of Governors, 1933), pp. 260-85. In practice, however, reserve requirements were of little help in containing the rapid credit growth that occurred in the late 1920s. During this period, the primary tool used by the Federal Reserve to influence credit conditions was the discount rate. Because this rate was generally kept below market rates and only marginal administrative pressure was used to dissuade banks from availing themselves of the discount window, banks had an incentive to borrow the reserves they needed to finance their rapidly expanding assets from the Federal Reserve, and they responded vigorously to this incentive. Throughout much of the 1920s, discount window borrowings were more than half of total Federal Reserve assets. With the Federal Reserve effectively accommodating much of the increased credit expansion, reserve requirements placed no significant constraint on lending. In addition, the Federal Reserve had no authority to raise reserve requirements even if it had wanted to make them a more binding constraint on credit expansion. During the Great Depression, as market interest rates plunged and loan demand all but dried up, reserve requirements were obviously not needed to curtail credit growth. In fact, through much of this period, banks held large quantities of reserves in excess of their reserve requirements, suggesting that reserve requirements were not in any way constraining credit expansion. The Federal Reserve was concerned that these large excess reserves could eventually be used to support an overly rapid buildup of deposits and loans that could ultimately prove inflationary. Therefore, it excercised its newly acquired powers under the Banking Act of 1935 and doubled the required reserve ratios on both demand and time deposits, thereby effectively absorbing much of extant excess reserves.8 By 1938, however, as evidence mounted that the nascent economic recovery was imperiled, the Federal Reserve moved to trim reserve requirements on both demand and time deposits, hoping to free up additional funds for lending. 8. The Thomas Amendment of 1933 first granted authority to the Federal Reserve Board to raise reserve requirements, subject to presidential approval, provided that a national emergency was declared. The Banking Act of 1935 eliminated the need for presidential approval or the declaration of an emergency, though it also precluded the Board from reducing requirements below the levels then in force or from more than doubling those requirements. Reserve Requirements: History, Current Practice, and Potential Reform In the years surrounding World War II, monetary policy considerations became subordinate to financing the government debt. During this period, the Federal Reserve abandoned an active monetary policy role and chose as its highest priority to accommodate the government's financing needs by buying Treasury securities at low interest rates. Postwar Issues: Membership Attrition and Monetary Control In 1951, the Federal Reserve resumed an active, independent monetary policy. In subsequent years, reserve requirements were adjusted numerous times, usually to reinforce or supplement the effects of open market operations and discount policy on overall monetary and credit conditions. In the short run, however, reserve requirements placed little constraint on the expansion of deposits because the Federal Reserve largely accommodated any such expansion through open market operations. Over time, though, if the Federal Reserve sought to reduce the availability of money and credit by providing reserves less generously through open market operations, it could and often did augment its actions by raising reserve requirements. The use of reserve requirements as a supplemental tool of monetary policy was particularly prevalent in the 1960s and 1970s, as the Federal Reserve sought to influence the expansion of money and credit in part by manipulating bank funding costs. As financial innovation spawned new sources of bank funding, the Federal Reserve began to adapt reserve requirements to these new financial products and often changed requirements on the specific bank liabilities that were most frequently used as marginal sources of funding. As banks began to rely more heavily on the issuance of largedenomination time deposits (CDs) to fund their asset acquisitions in the 1960s, for example, the Federal Reserve began periodically to alter reserve requirements on these instruments, thereby affecting their cost of issuance and, thus, the supply of credit through banks. It sometimes supplemented its actions by placing a marginal reserve requirement on large time deposits—that is, an additional requirement applied only to each new increment of these deposits. 575 Reserve requirements were also imposed on other, newly emerging liabilities that were the functional equivalents of deposits. For example, as banks started to rely more on Eurodollar borrowings as a funding source in the late 1960s, partly in an effort to circumvent existing reserve requirements, the Federal Reserve imposed marginal requirements on these liabilities and adjusted these requirements periodically throughout the 1970s. The imposition of reserve requirements on these and other managed liabilities was especially useful in the late 1970s, as the Federal Reserve aggressively sought to curb the expansion of money and credit and thereby ease price pressures. Throughout this period, reserve requirements also had important implications for membership in the Federal Reserve System. Since membership was optional for state-chartered banks, some of these institutions began to leave the System in the 1950s to take advantage of the lower reserve requirements imposed by most state regulatory authorities, some of whom also allowed banks to meet part of their requirements with interestearning assets. The Federal Reserve feared that if enough banks left the System, changes in the cost and availability of reserves to the remaining member banks might have a diminished effect on overall monetary and credit conditions, thus undermining the efficacy of monetary policy. Change in vault cash accounting. To reduce the burden of reserve requirements and stem the erosion of membership in the System, legislation was enacted allowing banks to resume using vault cash to satisfy their reserve requirements. This change, which was phased in beginning December 1959, provided the greatest relief to small banks, which tended to hold relatively large quantities of vault cash to meet their customers' liquidity needs. Permitting this vault cash to be used to meet reserve requirements reduced the amount of non-interestbearing balances these banks had to hold at the Federal Reserve. Because smaller banks were most apt to leave the System, it was hoped that this reform would help stanch membership attrition. Although larger banks tended to benefit less from this rule change, they were less likely to leave the System because they often reaped the greatest benefits from free Federal Reserve services, par- 576 Federal Reserve Bulletin • June 1993 1. Burden of reserve requirements, 1959-92' Billions o 2. Marginal reserve tax on transaction deposits, 1959-93 :Q1' Required reserves 1. The marginal reserve tax is the quarterly average effective federal funds rate times the highest reserve requirement on transaction deposits during the quarter. Effective federal funds rate Billions of dollars Forgone interest (1982 dollars)2 1960 1965 1970 1975 1980 1985 1990 1. Data are annual averages. 2. Forgone interest is defined as required reserve balances multiplied by the federal funds rate. ticularly those related to the clearing of financial transactions. The change in vault cash accounting did in fact reduce the level of required reserve balances somewhat in the early 1960s (top panel of chart 1). This decline, coupled with a drop in short-term interest rates (middle panel of chart 1), helped lighten the burden of reserve requirements in terms of the interest forgone on required reserve balances (bottom panel of chart 1). Proposals to change the structure of reserve requirements. This relief proved temporary, however. As interest rates climbed in the late 1960s and into the 1970s, the burden of reserve requirements became more onerous; with higher interest rates, banks were being forced to forgo more earnings by holding non-interest-bearing required reserve balances. Indeed, the marginal tax rate on transaction (demand) deposits—the reserve tax on an additional dollar of these deposits, as measured by the reserve requirement times the rate of interest forgone—rose through much of this period as well (chart 2). As a result, more banks began to leave the Federal Reserve System, taking with them an ever-increasing share of the deposits in the banking system. By the early 1970s, for example, the share of transaction deposits held by member banks had fallen below 75 percent from nearly 85 percent in the late 1950s (chart 3). In response, the Federal Reserve began to argue for additional legislation aimed at stemming the corrosive effects of the decline in membership on monetary control. Either all depository institutions should be subject to reserve requirements established by the Federal Reserve, thereby rendering the membership issue irrelevant, the System argued, or interest should be paid on required reserve balances, thereby removing banks' primary motive for leaving the System.9 Opposition to both proposals proved strong, however, with nonmember banks leading the crusade against universal reserve requirements and 9. Each Annual Report of the Board of Governors of the Federal Reserve System between the years 1964 and 1979 argued for the adoption of legislation aimed at reforming the structure of reserve requirements to combat the problem of membership attrition. Reserve Requirements: History, Current Practice, and Potential Reform 3. Member bank transaction deposits as a share of total transaction deposits, 1959-80' Percent — * - I I I I I I960 I I I I I 1965 I I I I I 1970 I I I I I 1975 1 — 85 — 80 — 75 — 70 - 65 1 1 1980 1. Transaction deposits are defined as net demand deposits plus NOW accounts. Data are expressed as annual averages. with both the legislative and executive branches of the federal government opposed to interest on reserves out of concern about Treasury revenues. In fact, a 1963 presidential commission cautioned against any significant cuts in reserve requirements to avoid a sharp drop in Treasury revenue.10 Most academics, by contrast, usually supported retaining and even increasing reserve requirements to tighten the link between reserves and money, while paying interest on reserves to eliminate the distortional effects of the reserve tax.11 Lagged reserve requirements. Thwarted in its attempts to promote substantive change in the structure of reserve requirements, the Federal Reserve took several smaller, unilateral steps aimed at stemming membership attrition. In 1968, a system of lagged reserve requirements (LRR) was implemented in which a bank's required reserves were computed based on its deposit levels from two weeks earlier. Previously, the computation period for deposits had been essentially contemporaneous with the maintenance period for reserves. By switching to LRR, the Federal Reserve hoped to make it less difficult and costly for banks to calculate their reserve requirements and to manage their 10. Report of the Committee on Financial Institutions to the President of the United States, Walter W. Heller, Chairman (GPO, 1963). 11. See, for example, Milton Friedman, A Program for Monetary Stability (Fordham University Press, 1959), pp. 65-76; Thomas Mayer, "Interest Payments on Required Reserve Balances," Journal of Finance, vol. 21 (March 1966), pp. 116-18; and George S. Tolley, "Providing for Growth of the Money Supply," Journal of Political Economy, vol. 65 (December 1957), pp. 477-85. 577 reserve positions. One problem with LRR was that it weakened the direct, contemporaneous link between reserves and money, thus making it harder, in principle, to manipulate reserves to control money, at least in the short run. This problem was not considered a serious one, however, because Federal Reserve procedures at that time were not directed at tight, short-run control of money through a reserves operating target. Graduated reserve requirements. In the late 1960s, the Federal Reserve also began to move away from a system of reserve requirements based on geographic distinctions, as embodied in the reserve city bank and country bank designations. By 1972, the old system was eliminated altogether, and a new system with a progressive, graduated reserve requirement schedule was implemented. Under the new system, reserve requirements increased with the level of each bank's deposits, independent of its location. Although the specifics were somewhat complicated (see the appendix for details), the upshot of the change was to reduce reserve requirements for smaller banks, which were still most likely to leave the System. At the same time, however, the move to a system with many reserve requirements based on different deposit levels further weakened the link between the aggregate level of reserves and the total amount of deposits in the banking system. Again, however, because the Federal Reserve was not trying to maintain control of deposits through a reservestargeting procedure, this effect was not a major concern. Continued decline of membership. Despite the efforts of the Federal Reserve, the decline of membership in the System continued unabated, with the proportion of transaction deposits at member banks falling below 65 percent of total transaction deposits by the late 1970s (chart 3), in part because rising interest rates were enlarging the reserve tax (charts 1 and 2). In response, the Federal Reserve began to argue more vociferously for changes in the structure of reserve requirements to prevent membership attrition from further undermining the efficacy of monetary policy.12 In 1978, it even went 12. See "Statement by G. William Miller, Chairman, Board of Governors of the Federal Reserve System, before the Committee 578 Federal Reserve Bulletin • June 1993 so far as to propose a unilateral plan to pay interest on reserves, which elicited strenuous congressional opposition.13 The relative decline in the deposit base at member banks became particularly worrisome after October 1979, when the Federal Reserve adopted a reserves-based operating procedure designed to maintain close, short-run control of Ml. The success of this procedure depended in part on how tight the link was between reserves at member banks and the level of Ml deposits in the entire banking system—a link that was being weakened by the continued decline in membership as well as by some of the steps the Federal Reserve had taken to try to reverse this decline, including switching to LRR and instituting graduated reserve requirements. The Monetary Control Act and Ml Targeting After years of debate, the Congress finally adopted legislation to reform reserve requirement rules in order to end the problem of membership attrition and facilitate control of Ml. The Monetary Control Act of 1980 (MCA) mandated universal reserve requirements to be set by the Federal Reserve for all depository institutions, regardless of their membership status. The act also vastly simplified the graduated reserve requirement schedule, further tightening the link between reserves and money. Although the key focus was on transaction (Ml) deposits, all of which were made subject to reserve requirements, certain types of nontransaction deposits also became subject to requirements, which effectively broadened the reserve base and required more depositories to hold reserve balances. In this way, the Federal Reserve's ability to influence aggregate deposit levels by manipulating the quantity of reserves was improved. The MCA on Banking, Finance and Urban Affairs, U.S. House of Representatives, July 27, 1978," Federal Reserve Bulletin, vol. 64 (August 1978), pp. 636-42; and "Statement by Paul A. Volcker, Chairman, Board of Governors of the Federal Reserve System, before the Committee on Banking, Housing, and Urban Affairs, U.S. Senate, February 4, 1980," Federal Reserve Bulletin, vol. 66 (February 1980), pp. 643^8. 13. For details on the Federal Reserve's proposal, see Federal Reserve Bulletin, vol. 64 (July 1978), pp. 605-10. For congressional reaction, see "Monetary Control and the Membership Problem." Hearings. also granted the Federal Reserve authority to impose a supplemental reserve requirement of up to 4 percent on transaction accounts. Finally, as a result of MCA, the number of depositories required to report their deposits to the Federal Reserve increased markedly, thus improving the accuracy and timeliness of data necessary for monetary control. To ease the burden of reserve requirements, the MCA initially set the basic reserve requirement on transaction deposits at 12 percent—below the 16V4 percent maximum that had been in effect for member banks—and prohibited the Federal Reserve from raising this requirement above 14 percent. It also set a 3 percent reserve requirement on the first $25 million of deposits at each institution—the so-called low reserve tranche—as a special concession to smaller depositories. In 1982, the Garn-St Germain Act went even further by exempting from reserve requirements altogether the first $2 million of deposits. The law mandated annual adjustments to the cutoffs for the exemption and the low reserve tranche based on aggregate growth in reservable liabilities and transaction deposits respectively. To help smooth the transition for nonmember banks and thrift institutions, a multiyear phase-in period was put in place, and the Federal Reserve was also prohibited from putting reserve requirements on personal time and savings deposits, which were particularly important sources of funds for these institutions. Finally, all institutions with reservable deposits, not just member banks, now had access to the discount window as well as to Federal Reserve services, including check clearing, funds transfers, and the like, though these services were no longer to be provided free of charge. The MCA did not specifically prohibit or authorize the payment of interest on required reserves, although it mandated the payment of interest on supplemental reserves should the Federal Reserve ever impose them. The legislative history of the MCA indicates that the Congress was concerned about the possible adverse effects of the act on Treasury revenues, so much so that the MCA even prohibits the Federal Reserve from lowering the reserve requirement to less than 8 percent on transaction deposits. The legislative history also indicates that the Congress was concerned that payment of interest on reserves would give the Federal Reserve Requirements: History, Current Practice, and Potential Reform Reserve, in its role as a provider of financial services, an unfair competitive advantage over depository institutions, which are prohibited from paying interest on demand deposits. Appreciative of this concern and aware of the distortions created by the prohibition of interest payments on demand deposits, the Federal Reserve advocated removal of this prohibition in conjunction with the payment of interest on reserves.14 Neither proposal was adopted, however. Thus, the reserve tax on depositories and their customers remained. In 1982, the Federal Reserve took another step to improve its short-run control of Ml by deciding to switch to a contemporaneous reserve requirement (CRR) scheme. By making the period in which banks are required to maintain their reserves against transaction deposits virtually contemporaneous with the period in which deposit levels are computed for the purpose of determining reserve requirements, this move tightened the real-time link between reserves and Ml. 15 In so doing, it remedied a weakness in the short-run monetary control mechanism of the existing, reserves-based operating procedure. Reserve Requirements since the Abandonment of Ml Targeting Ironically, by the time CRR was instituted in 1984, the Federal Reserve had shifted its focus away from short-run control of Ml via a reserves-based operating procedure, preferring instead to influence monetary and credit conditions by adjusting the cost and availability of reserves to depositories. It also shifted its focus more toward M2, as this aggregate was seen as more closely linked to the ultimate objectives of monetary policy than Ml, which had become overly sensitive to interest rates after the authorization of nationwide NOW accounts and the general deregulation of deposit rates. Thus, the basic structure of reserve requirements, which had been meticulously designed to 14. See statement by J. Charles Partee, October 27, 1983. 15. Actually, banks were required to hold an average amount of reserves over a two-week maintenance period ending every other Wednesday, based on average deposit levels in a two-week computation period that ends on a Monday two days before the end of the maintenance period. 579 facilitate the control of Ml through a reservesoriented targeting procedure, had seemingly become an anachronism. In fact, however, reserve requirements continued to play an important role in the conduct of monetary policy, in part by providing a stable, predictable demand for aggregate reserves. Absent reserve requirements, banks would still hold some balances at the Federal Reserve to meet their clearing needs. Given the size and volatility of the financial transactions that clear through these reserve accounts, depositories need to maintain a cushion of balances in these accounts to provide some protection against uncertain debits that can potentially leave their accounts overdrawn at the end of the day and subject to stiff penalties.16 The exact amount of balances that banks wish to hold for clearing purposes may vary considerably from day to day, however, and cannot be forecast with much precision by the Federal Reserve. By making reserve requirements the binding constraint on banks' demand for reserves—that is, by keeping required reserve balances above the uncertain level needed for clearing purposes—the Federal Reserve can more accurately determine the banking system's demand for reserves. In this way, it can more readily achieve any desired degree of pressure on bank reserve positions and associated reserve market conditions simply by manipulating the maintenance-period-average supply of reserves. By requiring banks to hold an average amount of reserves over a two-week maintenance period rather than a specific amount on each day, current regulations allow considerable flexibility in daily reserve management. Banks can use this flexibility to arbitrage anticipated, intraperiod variations in the cost of reserves (the federal funds rate), by substituting reserves on one day of the period when they are expected to be less costly for reserves on another day when they are expected to be more costly. This sort of intraperiod arbitrage serves to reduce day-to-day fluctuations in the cost of reserves. The lower the level of required reserve balances, however, the less leeway a bank has for manipulating the intraperiod profile of its reserve 16. At present, the penalty rate on overnight overdrafts is the higher of 200 basis points above the federal funds rate on the day, or 10 percent. In addition, banks have to offset overdrafts later in the period to meet their reserve requirements. 580 Federal Reserve Bulletin • June 1993 4. Reserve and clearing balances, 1 9 8 0 - 8 9 5. Volume of funds transactions clearing through reserve accounts, 1 9 8 0 - 9 0 1980 1982 1984 1986 1988 1990 Observations are annual averages of daily data. Data are annual averages. position without jeopardizing its overnight overdraft protection; hence, the bank will be less able to arbitrage day-to-day variations in the federal funds rate. Banks that find their required reserve balances insufficient to meet their clearing needs—that is, to provide them with adequate overdraft protection— are able, under the provisions of MCA, to open clearing balances. Banks can contract with the Federal Reserve to hold an average amount of these balances in their reserve accounts over the twoweek reserve maintenance period. If they fail to hold the amount required under the contract, they are penalized, much as would be the case if they failed to hold sufficient balances to meet their reserve requirements. Unlike required reserve balances, however, which do not earn interest, banks receive earnings credits on the amount of clearing balances they are required to hold under their contractual agreement. They can, in turn, use these earnings credits to defray the costs of Federal Reserve priced services. Thus, from a bank's perspective, opening a clearing balance is a virtually costless way to boost the average balance it is required to hold in its reserve account over the maintenance period and hence to provide extra insurance against overdrafts and added flexibility to reserve management. Not surprisingly, in the years immediately after passage of MCA, as required reserve balances fell as a result of the phased reductions in reserve requirements for member banks (top panel of chart 4), many of these institutions opened clearing balances to help replenish their diminished protection against overdrafts. Indeed, by 1986, the banking system as a whole had contracted to hold roughly $l 3 /4 billion of clearing balances (bottom panel of chart 4). To a lesser extent, other banks, particularly those using small amounts of priced services from the Federal Reserve and those new to managing reserve accounts, increased their holdings of excess reserves to help meet their clearing needs. These changes, coupled with a rebound in required reserve balances, provided banks with more of a cushion to handle a sharp increase in the volume of funds transactions clearing through their reserve accounts (chart 5). RECENT CUTS IN RESERVE REQUIREMENTS In the decade after passage of the MCA in 1980, the Federal Reserve left reserve requirements essentially unchanged. More recently, however, it has taken two steps to reduce these requirements. In December 1990, the required reserve ratio on nontransaction accounts—nonpersonal time and savings deposits and net Eurocurrency liabilities— was pared from 3 percent to zero, and in April 581 Reserve Requirements: History, Current Practice, and Potential Reform 1992, the 12 percent requirement on transaction deposits was trimmed to 10 percent. 2. Effect of recent cuts in reserve requirements Effective date of cut Rationale These actions were motivated in part by developments in credit markets, where evidence had emerged suggesting that some lenders had adopted a more cautious approach to extending credit. This caution was exerting a restraining effect on the cost and availability of credit to some types of borrowers. By reducing depository funding costs and thus providing depositories with easier access to capital markets, the cuts in reserve requirements were designed to put banks in a better position to extend credit. In particular, the cut in the requirement on nonpersonal time deposits was aimed directly at spurring bank lending because these accounts are often used as a marginal funding source. Of course, it was recognized that some, if not all, of the benefits stemming from the reserve requirement cuts would likely be passed on, over time, to borrowers and lenders.17 The cuts in reserve requirements were also motivated by the Federal Reserve's recognition that much of the early-1980s rationale for reserve requirements had evaporated with the abandonment of a reserves-oriented operating procedure geared to short-run control of Ml. At the same time, it realized that reserve requirements still played a vital role in policy implementation. Indeed, it chose not to make even deeper cuts in requirements for fear that required balances would fall to levels insufficient to satisfy the normal clearing needs of the banking system. Effects of Reserve Requirement Cuts on the Size of the Reserve Tax The elimination of the 3 percent reserve requirement on nontransaction accounts at the end of 1990 reduced the level of required reserve balances roughly $11V^ billion, or about one-third (table 2). 17. For details on the rationales for the recent cuts in reserve requirements, see Federal Reserve Bulletin, vol. 77 (February 1991), pp. 95-96; and Federal Reserve Bulletin, vol. 78 (April 1992), pp. 272-73. December 1990 April 1992 Reduction in required reserve balances (billions of dollars) Federal funds rate (percent) Reduction in interest forgone (millions of dollars) W/2 m 7.0 4.0 800 350 Using the 7 percent federal funds rate that prevailed at the time as a proxy for the interest that could have been earned on these balances, the cut in reserve requirements translated into an increase of about $800 million in the annual, pretax earnings of depositories and their customers. As a result of this cut in reserve requirements, about 2,500 depositories whose vault cash had formerly been insufficient to meet their reserve requirements were no longer bound to hold balances at the Federal Reserve. For these institutions, therefore, the reduction in the nontransaction requirement essentially eliminated the reserve tax. Trimming the required reserve ratio on transaction accounts in April 1992 relieved several hundred additional institutions from having to hold balances at the Federal Reserve. Overall, this second cut in reserve requirements reduced the required reserve balances of the entire banking system about $8!/2 billion, resulting in annual pretax savings of roughly $350 million for the private sector, given the 4 percent federal funds rate that prevailed at the time. Effects on Bank Reserve Management and Open Market Operations In the immediate aftermath of the December 1990 cut in reserve requirements, the level of required operating balances—the sum of required reserve balances and the amount of clearing balances required to be held under contractual arrangements between depositories and the Federal Reserve— plunged (chart 6). By early February 1991, these balances reached a trough of about $18^4 billion— barely more than half their level in the period preceding the cut in requirements and nearly 40 percent below their seasonal low in early February 1990. Required operating balances typically reach a low point at this time of the year because 582 Federal Reserve Bulletin • June 1993 6. Reserve balances, 1989-March 31, 1993 Maintenance period averages 1 1989 1990 1991 1992 1993 1. Reserve maintenance periods run for two weeks, so that there are twentysix periods each year. In this chart and in charts 7,8, and 9, there are twenty-six observations for each full year. 2. Required operating balances are required reserve balances plus required clearing balances. required reserves fall from their end-of-year peak. Also, owing to regulations stipulating that depositories apply their vault cash holdings from two maintenance periods earlier in meeting their current reserve requirements, the enlarged holdings of vault cash from year-end do not become available for use in meeting reserve requirements until late January and early February. 7. Reserve market volatility, 1988-March 31, 1993 Variance of daily effective federal funds rate With required operating balances falling below the levels needed by many depositories for daily clearing purposes, the marginal dollar of reserve demand often stemmed from clearing needs on the day, rather than from a reserve requirement averaged over two weeks. As a result, banks had less scope for manipulating their reserve positions from one day to the next and, consequently, for arbitraging anticipated intraperiod variations in the cost of reserves. Not surprisingly, a variety of measures of federal funds rate volatility posted significant increases (chart 7). At the same time, many depositories held levels of excess reserves that greatly exceeded those seen in comparable periods of recent years in order to restock their depleted overdraft protection (chart 8). Because the extent to which banks wanted to boost their holdings of excess reserves was unknown to the Federal Reserve, it became more difficult to estimate the demand for reserves and, thus, to conduct open market operations. Transition to a More Orderly Reserve Market Over the next few months, reserve market conditions returned to normal, with both excess reserves and the volatility of the funds rate falling back more or less to levels seen before the cut in reserve requirements. Although the reasons for the more stable reserve market climate varied, the rapid rebuilding of required operating balances was probably the most important. The higher level of balances provided banks with more adequate overdraft protection and greater flexibility in managing their reserve positions, thus reducing the need for excess 8. Excess reserves, 1989-March 31, 1993 Maintenance period averages 1988 1989 1990 1991 1992 1. Computed around the maintenance period average. 1993 Billions of dollars Reserve Requirements: History, Current Practice, and Potential Reform 9. Required clearing balances, 1989-March 31, 1993 Maintenance period averages Billions of dollars Reserve requirement cut Reserve requirement cut 4 —2 1989 1990 1991 1992 1993 balances and providing additional leeway for arbitrage in the funds market. The pronounced rebound in required operating balances over the remainder of 1991 owed in part to a surge in required reserves stemming from rapid growth in transaction deposits. Furthermore, deliberate efforts by depositories to hold additional balances also played a role in the faster-than-usual increase in required operating balances. For example, banks used clearing balances much more after the cut in reserve requirements (chart 9). Evidence also suggests that some banks sought to economize on their vault cash holdings to boost their required reserve balances. In addition, depositories may have learned to manage their reserve accounts more efficiently, making use of improved, real-time information on the status of their reserve balances throughout the day to lower the cushion they needed to hold as insurance against uncertain debits that can result in overdrafts. The Cut in the Transaction Requirement With the reserve market functioning reasonably well again, the Federal Reserve believed that it could safely lower reserve requirements once more. As it turned out, the cut in the transaction requirement in April 1992 was relatively uneventful. Although required operating balances initially dropped sharply, the decline was not nearly as precipitous as that seen in early 1991; not only was this cut smaller in terms of its effect on required reserve balances, it also came at a time of the year when these balances tend to be high because of the buildup of transaction deposits in anticipation of the April 15 tax date. Moreover, required operating 583 balances quickly made up all their lost ground, spurred by continued rapid growth in required reserves and another surge in the use of clearing balances. Indeed, these balances now total about $6 billion, or more than three times their level before the first cut in reserve requirements; they now make up nearly 20 percent of required operating balances versus about 5 percent in late 1990. The Federal Reserve also made several changes in reserve accounting rules to help banks better manage their accounts in a world of lower requirements and to aid the implementation of monetary policy. First, to smooth the seasonal pattern in required operating balances, the Federal Reserve reduced the lag on the application of vault cash for use in meeting reserve requirements from two maintenance periods to one, effective in the period beginning November 12, 1992. By more closely synchronizing the movements in required reserves and applied vault cash, this change was designed to temper seasonal declines in required operating balances, particularly the most severe decline, which occurs in late January and early February. To give depositories greater flexibility in managing their reserve positions from one period to the next, the Federal Reserve also doubled the carryover privilege, which enables banks to carry forward into the next maintenance period small reserve surpluses and deficiencies.18 These changes, coupled with the rebound in required operating balances, helped prevent the cut in the transaction requirement from having adverse effects on the functioning of the reserve market or on the conduct of open market operations. In fact, most measures of the volatility of the federal funds rate are up only marginally relative to their levels before December 1990, and aggregate excess reserves are running only a shade higher than before the cuts in reserve requirements. Some evidence suggests, however, that banks do have a bit less flexibility in managing their reserve positions from day to day; in particular, some systematic patterns in the behavior of the federal funds rate within reserve maintenance periods have intensified, suggesting that banks may not have as much 18. Since September 1992, depositories have been able to carry forward one maintenance period the greater of 4 percent of required reserve plus clearing balances, or $50,000; the carryover allowance had previously been the greater of 2 percent, or $25,000. 584 Federal Reserve Bulletin • June 1993 scope to arbitrage in the funds market as they once did.19 Concerned that additional declines in required operating balances would complicate reserve management and the conduct of open market operations, the Federal Reserve has not made further cuts in reserve requirements. Nevertheless, owing to the cuts it did make as well as to declines in short-term interest rates, the reserve tax has been falling sharply in recent years (chart 1). Consequently, the marginal tax rate on transaction deposits has dipped to its lowest level in thirty years (chart 2). Even so, this tax still represents a burden on the private sector, and one that could rise significantly if interest rates were to increase. Cognizant of the actual and prospective burden of the reserve tax, depositories continue to work to fashion financial products aimed largely at exploiting loopholes in reserve regulations. POTENTIAL REFORMS TO THE CURRENT SYSTEM Several suggestions have been put forth over the years for reforming the system of reserve requirements. In this section, I review some of these proposals, drawing heavily on the lessons learned from the recent cuts in reserve requirements as well as from the experiences of other countries that have lowered reserve requirements in recent years. Eliminate Reserve Requirements Although this proposal would clearly eliminate the reserve tax, recent experience suggests that it would also engender a significant increase in volatility in the reserves market and seriously complicate the conduct of open market operations. Moreover, absent reserve requirements, the Federal Reserve would be unable to reinstitute an effective, 19. Specifically, the federal funds rate has tended to be lower on Fridays, when reserves count three times in the calculation of a bank's period-average position; depositories are apparently more reluctant to build up their reserve balances on these days for fear that they will be unable to work them off later in the period without jeopardizing their overdraft protection. On settlement days, by contrast, the funds rate has tended to be higher, as banks move more aggressively to meet their reserve requirements. The persistence of systematic, intraperiod patterns in the funds rate suggests that arbitrage opportunities are not being fully exploited. reserves-oriented targeting procedure to control money growth if it ever deemed this action appropriate. Recent Trends in Other Countries Several other countries have significantly reduced, and in some cases essentially eliminated, reserve requirements in recent years. In the United Kingdom and Switzerland, for example, reserve requirements no longer effectively constrain bank behavior. In these countries, most banks find that their required reserves fall short of their daily clearing needs, so that at the margin the latter essentially determine their demand for reserves. More recently, Canada has also begun to phase out reserve requirements, and by 1994, their requirements will be completely eliminated. These countries have taken different steps, based on their own unique institutional structures, to facilitate bank reserve management and the conduct of open market operations in a world of nonbinding reserve requirements. The Bank of England (BOE), for example, has adopted a more flexible operating procedure, often intervening in the money markets several times a day to fine tune the cost and availability of reserves to meet everchanging clearing needs. In addition, banks in the United Kingdom are usually willing to borrow from the BOE late in the day to meet their clearing needs. Banks in the United States, by contrast, have become increasingly reluctant in recent years to avail themselves of Federal Reserve discount window credit, in part out of concerns that doing so might be interpreted by market participants as a sign of financial weakness. Even so, the volatility of overnight interest rates in the United Kingdom has tended, on average, to be somewhat higher than that in the United States, where reserve requirements are still binding for many institutions. The Swiss National Bank (SNB) has adopted a different approach than the BOE. Although it now places somewhat greater emphasis on smoothing short-term interest rates than it did in the past, it has been much less accommodative in offsetting temporary fluctuations in clearing needs than has the BOE. As a result, Switzerland has experienced greater volatility in overnight rates than the United Kingdom, and Swiss banks have chosen to hold substantial excess reserves, in part because over- Reserve Requirements: History, Current Practice, and Potential Reform night overdrafts are prohibited. At the same time, however, the ability of Swiss banks to access SNB credit at their own discretion, albeit at a penalty rate, has likely served to temper reserve market volatility somewhat. Although the jury is still out on the full ramifications of Canada's elimination of reserve requirements, which is in the process of being phased in, the Bank of Canada (BOC) feels that its financial system is amenable to functioning smoothly in the absence of reserve requirements. Specifically, Canada's system is highly concentrated, with a handful of large depositories controlling the lion's share of financial assets and handling the vast majority of financial transactions. These "direct clearers" will be required to clear all transactions through reserve accounts at the BOC, and although they will have no reserve requirements, they will be penalized if their reserve accounts are overdrawn. Thus, a demand for reserve liabilities at the central bank will be preserved, thereby enabling the BOC to implement monetary policy by manipulating the supply of reserves relative to this demand. Because the number of direct clearers is so small, moreover, the BOC can readily gauge the demand for clearing balances simply by keeping in close contact with the relevant banks. Finally, the BOC is also able to adjust the supply of reserves late in the day by moving government deposits between accounts in commercial banks and accounts at the BOC, thereby helping to mitigate volatility in the reserves market. Other central banks, such as the Bundesbank and the Bank of Japan (BOJ), which operate in financial environments more akin to those found in the United States, have not eliminated reserve requirements. Echoing arguments made by the Federal Reserve, both the Bundesbank and the BOJ believe that reserve requirements are essential for providing the stable, predictable demand for reserves that is needed for the conduct of open market operations and the prevention of undesirable money market volatility. Thus, although the Bundesbank has pared reserve requirements in recent years, these requirements are still binding for most German banks. Overall, based on the recent experience in the United States and the experiences of other countries, it seems clear that the Federal Reserve would have to alter its other tools of monetary policy 585 dramatically if it eliminated reserve requirements. In particular, to preserve its ability to conduct open market operations, it would have to ensure that depositories still had a demand for reserve liabilities at the Federal Reserve. To this end, it would likely have to require at least some depositories to clear their financial transactions through the Federal Reserve and to continue to subject them to penalties for overnight overdrafts. At the same time, it would probably also have to do something to make depositories less reluctant to use the discount window as a safety valve to defuse reserve market pressures. Even so, volatility in the money market is likely to rise significantly, and the Federal Reserve's ability to achieve desired reserve market conditions might be undermined as a result of the difficulty in gauging the banking system's demand for reserves. Pay Interest on Required Reserve Balances—the Preferred Solution Paying interest on reserves is a preferable alternative to eliminating reserve requirements. Specifically, if the Federal Reserve paid a market-based rate of interest on required reserve balances, the reserve tax would essentially be eliminated, as would the distortional effects of this tax on resource allocation. Households and businesses would not face an artificially imposed incentive to redirect credit flows away from depositories. Furthermore, depositories would no longer have an incentive to devote resources to new methods of reserve avoidance. If required reserve balances earned interest, moreover, the Federal Reserve could even raise reserve requirements if it wanted to provide banks with greater flexibility in managing their reserve positions, reduce volatility in the money markets, and simplify the conduct of open market operations, without having to worry about imposing a tax on the private sector.20 20. An alternative proposal would have the Federal Reserve raise reserve requirements and pay interest only on the increased balances depositories were required to hold. Though this plan would not reduce Treasury revenue, it would also not do anything to reduce the deleterious effects of the current reserve tax. For details on this proposal, see Spence Hilton, Melissa Gerdts, and Roxann Robinson, "Paying Interest on Reserves," in Federal Reserve Bank of New York, Reduced Reserve Requirements: Alternatives for the Conduct of Monetary Policy and Reserve Management (New York: FRBNY, 1993). 586 Federal Reserve Bulletin • June 1993 10. Required reserve balances as a percentage of total Federal Reserve liabilities, year-end, 1960-91 In the past, proposals to pay interest on required reserve balances have encountered resistance largely because they would reduce the earnings remitted by the Federal Reserve to the Treasury. Required reserve balances have been declining as a share of total Federal Reserve liabilities for years, however, and now make up only about 7 percent of the total (chart 10). As a result of this decline, which owes to reductions in reserve requirements as well as to relatively rapid growth of currency in circulation, the payment of interest on required reserve balances would now engender a relatively smaller reduction in the amount of Federal Reserve earnings remitted to the Treasury than ever before. In addition, it had often been argued in the past that the reserve tax on the depository system and its customers was more than offset by the governmentbacked deposit insurance program, which provided a subsidized, implicit government guarantee that conferred an advantage on depositories in their competition with other financial intermediaries. More recently, however, the price of this government guarantee has risen substantially. Not only have deposit insurance premiums been raised sharply, but capital requirements for depositories have been increased, more stringent standards for interbank lending have been imposed, and certain restrictions on deposit pricing have resurfaced. Taken together, these changes have served to increase the costs of intermediation through the depository system. Partly as a result of these increased costs, the share of new credit flows intermediated through the depository system has fallen dramatically in recent years. Although many of the credits formerly booked by banks and thrift institutions have been picked up by other intermediaries or have been channeled directly through the capital markets, with little attendant effect on the cost or availability of credit to most borrowers, some credits that are less easily substitutable, such as loans to small and medium-sized businesses, may have been curtailed, at least partly as a result of the increases in depository intermediation costs. Thus, it may be these borrowers who ultimately pay much of the price of the higher, government-mandated costs on depositories. Paying interest on required reserve balances would be one way of offsetting some of these higher costs. APPENDIX: SUMMARY OF RESERVE REQUIREMENTS SINCE 1913 The tables in this appendix summarize changes in required reserve ratios since the inception of the Federal Reserve System in 1913. Three major structures of reserve requirements have been used since 1913. The first two, which preceded passage of the Monetary Control Act of 1980, applied reserve requirements only to banks that were members of the Federal Reserve System. The first structure was based on geographic distinctions among member banks (table A.l). From 1913 to 1962, reserve requirements of member banks varied depending on whether the bank was located in a central reserve city, a reserve city, or elsewhere. In 1962, the authority of the Federal Reserve to classify or reclassify cities as central reserve cities was terminated. In 1966, the Federal Reserve moved toward the next structure, involving graduated reserve requirements based on the level of deposits at each bank. Each deposit interval shown in table A.2 represents that part of the deposits of each bank that was subject to the reserve requirement shown. For example, in July 1966, the first $5 million of time deposits at banks was subject to a 4 percent requirement; each additional dollar of time deposits was reservable at 5 percent. By 1972, a full-fledged graduated reserve requirement schedule was put in place, without regard to reserve city or country bank designations (table A.3). Another change in reserve regulations involved the definition of "net" demand deposits (tables A.l and A.2). In 1935, net demand deposits were defined as total demand deposits minus cash items in the process of collection and demand balances Reserve Requirements: History, Current Practice, and Potential Reform A.l. 587 Reserve requirements based on geographic distinctions among member banks, 1 9 1 3 - 6 6 Percent of deposits Net demand deposits Effective date Central reserve city banks Reserve city banks Country banks Time deposits (all classes of banks) 1913—December 23 18 15 12 5 1917—June 21 13 10 7 3 1936—August 16 19.5 15 10.5 4.5 1937—March 1 22.75 17.5 12.25 5.25 26 20 14 6 1938—April 16 22.75 17.5 12 5 1941—November 1 26 20 14 6 1942—August 20 24 26 22 16 7.5 24 21 15 7 20 14 6 20 13 6 12 5 6 May 1 September 14 22 October 3 20 1948—February 27 June 11 September 24, 16 1949—May 5, 1 June 30, July 1 August 1 22 24 f 1 August 11, 16 23.5 19.5 August 18 23 19 August 25 22.5 18.5 September 1 22 18 23 19 13 24 20 14 22 19 13 21 19 13 20 18 12 19.5 17.5 11.5 March 20, April 1 19 17 11 April 17 18.5 17 April 24 18 16.5 1951—January 11, 16 January 25, February 1 1953—July 9, 1 1954—June 24, 16 July 29, August 1 1958—February 27, March 1 1960—September 1 17.5 November 24 17.5 December 1 16.5 1962—July 28 October 25, November 1 T i In this table and in table A.2, when two dates appear on the same line, the first applies to the change at central reserve city banks and the second applies to the change at country banks. 5 The appendix continues on page 588. 12 4 588 Federal Reserve Bulletin • June 1993 due from other depositories. In 1969, reserves also began to be required against net balances due from domestic offices to their foreign branches. From June 21, 1973, through December 11, 1974, under the structure of graduated reserve requirements, member banks were subject to varying marginal reserve requirements against increases in the following: (1) time deposits of $100,000 or more; (2) funds obtained through issuance by any affiliate of the bank of obligations subject to reserve requirements on time deposits; and (3) funds from sales of finance bills (table A.3). The requirements applied only to balances above a specified base: A.2. They were not applicable to banks having aggregate obligations of these types of less than $10 million. Beginning November 2, 1978, a supplementary reserve requirement of 2 percent was added to the existing requirements on time deposits in excess of $100,000 and for certain other liabilities. This supplementary requirement was eliminated with the maintenance period beginning July 24, 1980. Also, effective with the reserve computation period beginning November 16, 1978, domestic deposits of Edge corporations were subject to the same reserve requirements as member banks. Reserve requirements based on geographic distinctions among member banks and on the level of deposits, 1966-72 Percent of deposits Time deposits (all classes of banks) Net demand deposits BCFCTFFR. JP 1966—July 14, 21 September 8, 11 Country banks (deposit intervals in millions of dollars) Reserve city banks (deposit intervals in millions of dollars) Effective date 0-5 More than 5 0-5 16.5 16.5 12 fel W w l ^ i l t l 1 E M S Other time (deposit intervals in millions of dollars) Savings More than 5 12 0-5 More than 5 4 5 4 4 4 1967—March 2 4 3.5 6 3.5 March 16 1968—January 11, 18 ... 1969—April 17 17 17.5 1970—October 1 17 17.5 A.3. Jill 12.5 % "tlJf¥P| 13 13 5 A graduated reserve requirement schedule for member banks, 1 9 7 2 - 8 0 Percent of deposits Time and savings deposits Net demand deposits (deposit intervals in millions of dollars) Effective date 0-5, by maturity 0-2 1972—November 9 2-10 10100 10 12 10 12 1973—July 19 10.5 12.5 1974—December 12 10.5 12.5 10 12 November 16 1975—February 13 . October 30 .. 1976—January 8 ... December 30 Time (deposit intervals in millions of dollars) 7.5 100400 30-179 days 180 days to 4 years 4 years or more More than 5, by maturity 30179 days 180 days to 4 years i I i l l l 2.5 2.5 9.5 2.5 2.5 11.75 4 years or more Reserve Requirements: History, Current Practice, and Potential Reform A.4. Reserve requirements since passage of the Monetary Control Act of 1980 Percent Effective date Net transaction accounts SELECTED Nontransaction accounts 1980—November 13 . . . . 1990—December 26 12 0 1992—April 2 10 0 Effective with the maintenance period beginning October 25, 1979, a marginal reserve requirement of 8 percent was added to managed liabilities in excess of a base amount. These liabilities included large time deposits, Eurodollar borrowings, repurchase agreements against U.S. government and agency securities, and federal funds borrowings from nonmember institutions. This marginal requirement was raised to 10 percent on April 3, 1980, lowered to 5 percent on June 12, 1980, and then eliminated altogether on July 24, 1980. Since passage of the Monetary Control Act in November 1980, after an initial phase-in period, all depository institutions have been subject to reserve requirements. Required reserve ratios are the same for all depository institutions under the current system and apply to transaction accounts and nontransaction accounts (table A.4). 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. The reserve requirements on transaction accounts shown in table A.4 apply only to those accounts that exceed the exemption and the low reserve tranche, the cutoffs for which adjust each year according to a formula provided by law. In 1993, for example, the first $3.8 million of transaction accounts at each depository is exempt from reserve requirements and the next $46.8 million is reservable at 3 percent. Only deposits in excess of this low reserve tranche are reservable at 10 percent. For the purposes of reserve requirements, nontransaction accounts include nonpersonal time and savings deposits that are not transaction accounts and in which the beneficial interest is held by a depositor that is not a natural person, as well as net borrowings by banks in the United States from banks outside the country. 589 BIBLIOGRAPHY Bank of Canada. "The Implementation of Monetary Policy in a System with Zero Reserve Requirements," Discussion Paper 3. (September 1991). Bernanke, Ben, and Frederic Miskin. "Central Bank Behavior and the Strategy of Monetary Policy: Observations from Six Industrial Countries." Working Paper 4082, Cambridge, Mass.: National Bureau of Economic Research, 1992. Board of Governors of the Federal Reserve System. "The History of Reserve Requirements in the United States," Federal Reserve Bulletin, vol. 25 (November 1938), pp. 953-72. Federal Reserve Bank of New York. "Reduced Reserve Requirements: Alternatives for the Conduct of Monetary Policy and Reserve Management," Staff Study (April 1993). Goodfriend, Marvin, and Monica Hargraves. "A Historical Assessment of the Rationales and Functions of Reserve Requirements," Federal Reserve Bank of Richmond, Economic Review, vol. 69 (March/April 1983), pp. 3-21. Horrigan, Brian R. "Are Reserve Requirements Relevant for Economic Stabilization?" Journal of Monetary Economics, vol. 21 (January 1988), pp. 97-105. Kasman, Bruce. "A Comparison of Monetary Policy Operating Procedures in Six Industrial Countries," Federal Reserve Bank of New York, Quarterly Review, vol. 17 (Summer 1992), pp. 5-24. Meulendyke, Ann-Marie. "Reserve Requirements and the Discount Window in Recent Decades," Federal Reserve Bank of New York, Quarterly Review, vol. 17 (Autumn 1992), pp. 2 5 ^ 3 . Stevens, E.J. "Is there any Rationale for Reserve Requirements?" Federal Reserve Bank of Cleveland, Economic Review, vol. 27 (Quarter 3 1991), pp. 2-17. Weiner, Stuart E. "Payment of Interest on Reserves," Federal Reserve Bank of Kansas City, Economic Review, vol. 68 (January 1983), pp. 16-31. "The Changing Role of Reserve Requirements in Monetary Policy," Federal Reserve Bank of Kansas City, Economic Review, vol. 77 (Fourth Quarter 1992), pp. 45-63. • 590 Industrial Production, Capacity, and Capacity Utilization since 1987 Richard D. Raddock, of the Board's Division of Research and Statistics, prepared this article. The Federal Reserve recently revised its index of industrial production and the related measures of capacity and utilization. Compared with the previous index, the revised index shows that manufacturing grew more slowly from 1987 until the onset of recession late in 1990 and then recovered more rapidly, albeit unevenly. According to the revised numbers, from 1987 to 1992 the annual rate of growth in industrial production averaged 1.3 percent, 0.4 percentage point less than was formerly shown. From the first quarter of 1992 through the first quarter of 1993, revised industrial output rose at an annual rate of 4.4 percent to a new high. Preliminary estimates show that industrial production changed little in March and April 1993. The revised production and capacity indexes still cover manufacturing, mining, and electric and gas utilities and are still expressed as percentages of output in 1987. They have, however, incorporated new monthly and annual data—particularly output estimates derived from the Annual Survey of Manufactures of the U.S. Bureau of the Census and capacity utilization results from the Survey of Plant Capacity, also of the Census Bureau. The incorporation of the new data has progressively lowered the level of the revised industrial production index relative to that of the previous one until 1990. Whereas the previous index showed output peaking in September 1990 at 110.6 percent of the level of output in 1987, the revised index shows output reaching a high of 107.1 in April 1989 and then retreating a little until October 1989 (chart 1, top panel). The subsequent rebound recouped nearly all of the loss by the following summer. Then, as did the previous index, the revised index shows a cyclical contraction ensuing. From September 1990 to the following March, production dropped 4 percent to a low of 102.5, compared with the previous index of 105 percent. By February 1993, industrial output had reached 109.9 percent of its 1987 average—a new high, but 2.1 percentage points below the unrevised level. The Federal Reserve's index of industrial capacity was also revised downward. According to the revision, the annual growth in capacity from 1987 to 1992 averaged only 1.7 percent, down from the previous estimate of 2.3 percent. The rate of capacity growth has trended lower for many years; it tends to be especially slow during and immediately after recessionary periods, when plant closings increase and capital spending drops. As revised, capacity utilization, the ratio of output to capacity, was about the same for most of 1987-91 as it had been before the revision. It peaked at 84.8 percent in March 1989 and fell to a cyclical low of 78.3 percent two years later. 1. Revised and earlier industrial output, capacity, and utilization 591 1. Historical data for output, capacity, and capacity utilization for total industry, 1 9 8 6 - 9 2 1 Quarter Year 1 2 3 4 Annual avg. Output (percent of 1987 output) 1986 1987 1988 1989 1990 96.1 96.5 103.2 106.6 105.5 95.5 97.9 103.4 106.2 106.1 94.6 98.2 103.4 107.1 106.4 94.8 98.8 104.3 107.1 105.7 94.7 99.4 104.0 106.7 106.5 94.3 100.3 104.0 106.4 106.7 94.8 100.6 104.6 105.3 106.5 94.9 100.9 105.2 105.8 106.8 95.0 100.7 104.7 105.4 106.8 95.6 102.1 105.0 105.0 106.3 96.3 102.2 105.6 105.4 105.0 96.8 102.8 106.3 106.1 104.5 95.4 97.5 103.3 106.6 106.0 94.6 99.5 104.1 106.7 106.3 94.9 100.8 104.8 105.5 106.7 96.2 102.3 105.6 105.5 105.3 95.3 100.0 104.4 106.0 106.0 1991 1992 104.4 104.5 103.2 105.3 102.5 105.6 102.6 106.3 103.3 106.7 104.4 106.0 104.5 106.8 104.6 106.6 105.3 106.2 105.1 107.5 105.0 108.4 104.7 108.9 103.3 105.1 103.4 106.3 104.8 106.5 104.9 108.3 104.1 106.5 Capacity (percent of 1987 output) 1986 1987 1988 1989 1990 119.2 121.6 124.0 125.8 128.2 119.4 121.8 124.1 126.0 128.4 119.6 122.0 124.3 126.2 128.6 119.8 122.2 124.4 126.4 128.8 120.0 122.4 124.6 126.6 129.0 120.2 122.6 124.7 126.8 129.2 120.4 122.8 124.9 127.0 129.4 120.6 123.0 125.0 127.2 129.6 120.8 123.2 125.2 127.4 129.8 121.0 123.4 125.3 127.6 129.9 121.2 123.6 125.5 127.8 130.1 121.4 123.8 125.6 128.0 130.3 119.4 121.8 124.1 126.0 128.4 120.0 122.4 124.6 126.6 129.0 120.6 123.0 125.0 127.2 129.6 121.2 123.6 125.5 127.8 130.1 120.3 122.7 124.8 126.9 129.3 1991 1992 130.5 132.5 130.7 132.7 130.8 132.9 131.0 133.1 131.2 133.2 131.4 133.4 131.5 133.6 131.7 133.7 131.9 133.9 132.0 134.1 132.2 134.2 132.4 134.4 130.7 132.7 131.2 133.2 131.7 133.7 132.2 134.2 131.4 133.5 Utilization (percent of capacity) 1986 1987 1988 1989 1990 80.6 79.3 83.2 84.8 82.3 79.9 80.3 83.3 84.3 82.6 79.1 80.5 83.2 84.8 82.8 79.1 80.8 83.8 84.7 82.1 78.9 81.2 83.5 84.3 82.5 78.4 81.8 83.4 83.9 82.6 78.7 81.9 83.8 82.9 82.3 78.7 82.0 84.2 83.2 82.4 78.7 81.8 83.6 82.7 82.3 79.1 82.7 83.8 82.3 81.8 79.4 82.7 84.2 82.4 80.7 79.8 83.1 84.6 82.8 80.2 79.9 80.1 83.2 84.6 82.6 78.8 81.3 83.6 84.3 82.4 78.7 81.9 83.9 82.9 82.4 79.4 82.8 84.2 82.5 80.9 79.2 81.5 83.7 83.6 82.1 1991 1992 80.0 78.8 78.9 79.3 78.3 79.5 78.3 79.9 78.8 80.1 79.5 79.5 79.5 80.0 79.4 79.7 79.9 79.3 79.6 80.2 79.4 80.8 79.1 81.0 79.1 79.2 78.8 79.8 79.6 79.7 79.4 80.7 79.2 79.8 1. Seasonally adjusted. Neither the high nor the low reached the extreme values of the two preceding business cycles. During 1992, utilization rose with production and reached 81.4 percent in the first quarter of 1993, 0.5 percentage point below its 1967-92 average. However, the more rapid recovery of revised production from the trough and the slower growth of revised capacity led to an upward revision of utilization in 1992 and early 1993. For total industrial production, capacity, and capacity utilization for the period of the revision, see table 1. DEVELOPMENTS BY MARKET GROUPS Pronounced cyclical contractions and recoveries have been most evident in the output of construction supplies and consumer durable goods, particularly automotive products (chart 2). From its high in early 1989 to the trough in early 1991, output of consumer durable goods fell about 20 percent. After an uneven recovery, it regained its previous high in early 1993. Because of the peaking of building activity in 1986, production of construction supplies began to decline before the general cyclical peak, (table 2). Today, despite the lowest interest rates in nearly a quarter century, the recovery in output of construction supplies continues to be constrained—at least in part—by the high vacancy rates of rental housing and commercial buildings. In contrast to these strong cyclical patterns, the output of nondurable consumer goods, business supplies, and energy materials has fluctuated relatively little in recent years. The production of total equipment grew about 3 percent a year on average from early 1987 to early 1993, even though output of business vehicles and heavy machinery fell sharply in the recession and production of defense equipment has been cut considerably since 1990. The recently ended boom in commercial aircraft and the strong gains in output of computers, communications equipment, and medical instruments boosted the business equipment group in the 1987-92 period. From 592 Federal Reserve Bulletin • June 1993 2. Industrial output by market groups Ratio scale, 1987 output Business supplies Nondurable consumer goods Durable consumer goods Construction supplies Business equipment Energy materials Total equipmi Defense and space equipment Durable and nondurable materials early 1992 through early 1993, output of business equipment soared at an annual rate of more than 12 percent (8 percent, if office and computing equipment is excluded). The production of industrial materials used to manufacture durable and nondurable goods, which in the past was more cyclical than that of other industrial products, has, in recent years, roughly paralleled the movements of final products (consumer goods and equipment) production.1 This parallel movement may reflect the tighter management of stocks of materials that reduced overbuilding and the need for cutting stocks. Swings in net imports of some materials may have counterbalanced some of the swings in domestic demand. industry. As a result, short movements and trends in output, capacity, and utilization differ widely among industries. Manufacturing For analytical purposes, the large and diverse manufacturing sector—85 percent of total industrial production—is divided into two broad categories: primary-processing industries, which produce mainly materials and construction supplies, and advanced-processing industries, which produce mainly finished consumer or capital goods. Primary-Processing Industries DEVELOPMENTS BY SECTOR Although industries within manufacturing, mining, and utilities face similar cyclical forces, they are also influenced by other factors, such as technology and resource availability, that may be specific to an 1. The total products grouping includes consumer goods, equipment, and construction and business supplies. Among these industries, the output of lumber, stone, clay and glass, and primary and fabricated metals industries declined relatively severely in 1990-91; output in each case remains below earlier highs (table 3). From a high in January 1989, the output index for primary processing dropped 10 percent to the trough. Although recovery has been substantial since then and output of textiles, paper, and industrial chemicals reached new highs Industrial Production, Capacity, and Capacity Utilization since 1987 2. 593 Revised rates of growth in industrial production, by major market group, 1 9 8 7 - 9 2 Series 1988 1989 1990 1991 1992 1987-92 Average annual rate of growth (percent) Total Index 4.4 1.5 .0 -1.8 2.3 1.3 Products Final products Consumer goods Durable consumer goods Automotive products Home goods Nondurable consumer goods 4.1 4.8 2.9 4.6 6.4 3.0 2.4 1.5 1.9 1.1 1.9 1.6 2.1 .8 -.1 .1 -.5 -4.1 -6.9 -1.5 .5 -2.3 -1.5 -.6 -6.9 -10.9 -3.6 1.2 2.4 2.8 2.3 7.7 10.7 5.3 .9 1.1 1.6 1.0 .5 -.1 1.0 1.2 Equipment Business equipment Industrial Information processing Transit Other Defense and space 7.6 10.7 10.3 11.3 12.8 7.2 -.3 3.1 4.4 3.6 2.5 12.5 2.5 .4 1.1 1.2 -1.2 3.5 1.2 -.5 -1.2 -2.8 -1.1 -5.9 2.1 4.1 -7.6 -7.2 3.5 6.5 2.1 11.7 2.5 3.6 -6.3 2.4 4.3 1.6 6.1 6.5 .9 -3.0 1.8 1.5 2.0 .2 -1.0 1.0 -.8 -2.4 .1 -4.6 -7.5 -2.7 1.1 3.4 -.3 -.5 -1.3 .0 5.0 6.8 4.4 2.2 1.6 1.6 2.6 .8 .1 -.7 .8 1.1 -1.2 -2.3 -.8 .4 2.3 3.5 3.6 -1.1 1.5 1.7 2.1 .7 Intermediate products Construction supplies Business supplies Materials Durable goods materials Nondurable goods materials Energy materials Difference between revised and earlier growth rates (percentage points) Total index -1.0 -1.1 -1.0 .2 .8 -.4 Products Final products Consumer goods Durable consumer goods Automotive products Home goods Nondurable consumer goods -1.2 -.8 -1.1 -.3 .5 -1.1 -1.3 -1.6 -1.4 -1.5 -1.0 .6 -2.4 -1.8 -1.5 -1.5 -1.1 -2.6 -2.6 -2.1 -.7 -.5 -.3 -.8 -3.2 -6.6 -.3 .0 1.0 1.4 -.4 2.2 1.7 2.3 -1.1 -.7 -.5 -1.0 -1.0 -1.4 -.7 -1.0 .0 -1.1 .5 -1.3 -1.6 -3.1 1.7 -1.3 -2.1 .0 -5.6 4.3 -3.1 1.0 -1.7 -2.1 -2.5 -1.0 -3.7 -2.2 -1.0 .0 .2 .4 -1.3 6.5 -3.5 -.8 3.8 4.0 7.4 4.4 -.9 3.2 2.6 .1 -.2 1.2 -1.0 .9 -1.8 .7 -2.6 -2.9 -2.4 -2.1 -2.6 -1.8 -1.6 -1.6 -1.8 -.6 1.2 -1.9 -.1 2.0 -1.3 -1.4 -.7 -1.8 -.6 -2.2 1.4 .4 -.1 -.8 .4 1.2 -.3 -.9 .1 .4 .9 1.9 -.7 .2 .5 .9 .0 -.1 .1 -.2 .2 .4 Equipment Business equipment Industrial Information processing Transit Other Defense and space Intermediate products Construction supplies Business supplies Materials Durable goods materials Nondurable goods materials Energy materials in 1992, growth in output in primary processing industries averaged only 3A percent per year from 1987 to 1992. By early 1993, output had approximately recovered its peak (chart 3). So far in the nineties, capacity growth has slowed to an annual rate of only about 1 percent; the rate of capacity utilization in primary processing, which had peaked at 88 percent in early 1989, recovered from its recessionary dive to a moderate rate of 84 percent in early 1993. Capacity in some of these basic industries has remained flat. The annual capability for raw steel has stayed near 114 million tons, as older mills have closed and new minimills have been built. Aluminum mills have wrung some additional output of ingots from old potlines, but no new potlines have been constructed. Cement clinker capacity has contracted, and output and capacity in logging camps and lumber mills have been constrained by environmental regulation that reduced logging on 594 3. Federal Reserve Bulletin • June 1993 Revised rates of growth in industrial production, by major industry group, 1 9 8 7 - 9 2 Average annual rate of growth (percent) Series 1990 1991 1992 1987-92 1.5 .0 -1.8 23 L3 4.7 1.6 -.3 -2.2 3.1 1.3 Primary processing Advanced processing 3.9 5.1 .9 2.0 -.6 -.2 -3.7 -1.6 3.7 3.6 .8 1.8 Durable manufacturing Lumber and products Furniture and fixtures Stone, clay, and glass 6.6 .1 .3 2.6 1.8 -.8 1.3 .0 -1.0 -2.3 -1.4 -2.1 -3.3 -6.8 -6.0 -7.7 4.1 6.4 5.2 3.7 1.6 -.7 -.2 -.8 8.7 12.7 12.6 3.1 4.2 -1.3 -1.3 -3.6 -1.4 -1.3 -.7 .2 1.0 -2.2 -3.2 -7.6 -9.8 -11.2 -4.2 -4.6 2.7 4.1 4.0 .7 1.8 .2 .9 .2 -.8 -.7 13.0 10.3 20.3 8.5 3.8 3.8 3.7 2.2 .2 -2.2 6.3 .4 -3.3 -6.3 3.5 1.3 9.8 3.5 22.6 6.2 4.5 1.6 11.0 3.7 Transportation equipment Motor vehicles and parts Autos and light trucks Aerospace and miscellaneous Instruments 5.2 5.7 4.6 4.7 3.6 4.3 1.2 3.3 7.1 1.0 -2.4 -5.6 -6.9 .4 .3 -4.8 -6.6 -8.8 -3.3 .4 .8 11.2 10.6 -7.6 -1.1 .5 1.0 .3 .1 .8 Miscellaneous manufactures 6.8 .4 -.3 -1.8 4.5 1.9 2.3 1.5 1.8 -1.4 -1.9 3.1 1.3 1.0 -1.1 1.7 -3.2 1.8 .6 1.2 .1 -3.2 -3.0 .6 -.8 1.5 -4.4 -.2 -.3 .6 1.8 .6 3.0 8.1 .5 1.9 1.0 1.2 -.2 .9 -1.6 1.6 .9 6.0 1.9 2.6 -.2 .2 3.1 .4 3.4 -.2 -.3 2.3 1.0 1.1 -3.6 -4.0 -.4 -1.7 -2.5 -8.5 -1.9 3.3 .4 5.0 5.3 -1.0 2.8 .4 1.9 -1.5 1.3 20.3 3.1 -.3 2.3 -1.3 16.8 3.7 -3.7 -1.3 2.0 9.0 4.9 .8 1.4 -1.5 2.4 -2.5 -.9 -8.1 -2.8 3.2 -3.6 -3.5 -.3 -.5 10.1 1.1 -1.5 -1.3 5.0 4.7 6.2 3.5 3.4 3.9 1.1 2.4 -3.3 2.1 1.8 3.0 -.2 -1.1 3.1 2.3 2.2 2.5 Total index Manufacturing Primary metals Iron and steel Raw steel Nonferrous Fabricated metal products Industrial and commercial machinery and compu equipment Excluding computer and office equipment ... Computer and office equipment Electrical machinery Nondurable manufacturing Foods Tobacco products Textile mill products Apparel products Paper and products Printing and publishing Chemical and products Petroleum products Rubber and plastics products Leather and products Mining Metal mining Coal Oil and gas extraction Stone and earth minerals Utilities Electric Gas 1988 1989 4.4 millions of acres of federal timberland in the Pacific Northwest (chart 4). tion remains moderate, as capacity has expanded with output (chart 5). The performance of individual industries in this sector has been quite disparate in terms of cyclical volatility and growth. Advanced-Processing Industries These industries, which account for 70 percent of manufacturing, have grown faster than the rest of industrial production. In early 1992, they regained their peak level; and in the first quarter of 1993, output was 12 percent higher than it was in 1987— up more than 2 percent per year. Even so, utiliza Motor vehicles. Led by gains in the demand for trucks, the motor vehicle industry began to recover in 1992 from three years of declining output and sales. In 1991, U.S. output of vehicles, which from 1985 to 1988 had averaged about 11 million units, fell below 9 million units, the lowest level since 1982. Although large, this contraction was not as Industrial Production, Capacity, and Capacity Utilization since 1987 3. 595 Revised rates of growth in industrial production, by major industry group, 1 9 8 7 - 9 2 — C o n t i n u e d Difference between revised and earlier growth rates (percentage points) Series Total index Manufacturing 1988 1989 1990 1991 1992 -1.0 -1.1 -1.0 .2 .8 -.4 1987-92 -1.1 -1.3 -1.3 .1 1.0 -.5 Primary processing Advanced processing -1.2 -1.1 -.3 -1.6 -.5 -1.6 .0 .0 .4 2.1 -.3 -.4 Durable manufacturing Lumber and products Furniture and fixtures Stone, clay, and glass -1.0 -4.5 -3.3 -3.8 -1.3 .7 -.3 -1.5 -1.6 -.9 -2.0 .1 .8 .5 .4 2.4 2.8 1.7 4.1 2.3 -.1 -.5 -.3 -.1 Primary metals Iron and steel Raw steel Nonferrous Fabricated metal products Industrial and commercial machinery and computer equipment Excluding computer and office equipment Computer and office equipment Electrical machinery -1.6 -1.1 .0 -2.3 -2.0 -.3 2.6 .0 -4.8 -2.2 .1 -.4 .0 .3 -2.0 .6 1.0 .0 .2 .6 -.9 -2.1 .0 .7 .4 -.4 .1 .0 -1.1 -1.0 -.8 -.6 -.8 2.0 -3.2 -.4 -9.6 -.6 -3.7 -3.6 -2.9 -1.3 -.9 -.7 -.3 2.5 6.7 6.4 8.9 4.6 -.4 .2 -1.1 1.4 Transportation equipment Motor vehicles and parts Autos and light trucks Aerospace and miscellaneous Instruments Miscellaneous manufactures .2 .2 -.3 .2 -6.5 -.4 2.2 1.8 3.2 2.5 -4.8 -6.8 -.8 2.1 1.1 -3.2 -.1 -4.1 1.7 .0 -1.3 3.1 -.8 -1.3 2.2 2.1 -1.5 1.9 -1.0 4.4 1.1 1.2 .2 .9 -2.6 -1.8 -1.3 -1.3 .4 -1.2 .2 -1.4 -1.6 .6 -.4 -5.2 1.5 -.7 -.8 1.1 -2.2 2.2 -1.5 -.9 6 -5.5 .1 2.4 .8 -1.2 -.8 -2.6 2.6 -1.1 .0 -1.1 -.8 -1.2 -.3 -1.1 .2 -2.7 .6 -1.5 -3.3 .2 -4.6 .2 -2.2 .6 -4.3 -3.4 .6 -1.0 -.1 -.1 -4.3 -.9 -1.1 -2.3 3.4 -2.8 -2.3 -.6 -1.5 8.5 -3.6 -.4 -1.3 -1.3 1.6 -.5 -2.4 -1.9 .3 -4.5 .0 1.6 3.0 .2 -7.9 -.1 .7 -2.2 .8 -3.5 .0 4.3 1.0 -1.2 1.4 -.5 -2.0 -.2 -.8 1.9 -.2 .5 .0 -.1 -2.4 .6 .1 2.3 1.0 .0 4.7 .3 -.1 2.3 .9 .0 4.4 .4 .0 1.4 .6 .0 3.0 Nondurable manufacturing Foods Tobacco products Textile mill products Apparel products Paper and products Printing and publishing Chemical and products Petroleum products Rubber and plastics products Leather and products Mining Metal mining Coal Oil and gas extraction Stone and earth minerals Utilities Electric Gas great as the contractions between 1973 and 1975 and between 1978 and 1982, partly because this cycle had neither a curtailment in gasoline supplies nor so extreme a peak in output. The drop in production of motor vehicles and related parts and materials from its high in January 1989 to the trough accounted for about a third of the decline in manufacturing. Widely publicized plant closings by Chrysler, Ford, and General Motors accompanied the downtrend in the production of automobiles. The Big Three's auto assembly capacity in the United States fell from more than 9Vi million units in 1986-87 to less than 6V2 million units in the 1993 model year. In contrast, reflecting the rising share of trucks in overall vehicle sales, U.S. capacity to assemble light trucks increased about a million units to 5XA million units over the same period. Domestic producers shifted existing plants from autos to light trucks, built new truck plants, and increased hours of plant operation. Japanese auto producers continued to increase assembly capacity in the United States; "transplant" assembly capacity (mainly for autos) increased from about 1 million units in 1986-87 to more than 2 million units currently. Altogether, U.S. assembly capacity for motor vehi- 596 Federal Reserve Bulletin • June 1993 3. Revised and earlier output, capacity, and utilization in primary-processing industries cles has declined about a million units since 1986— 87 to about 1316 million units. With the increases in assembly capacity in Canada and Mexico, however, total North American assembly capacity has increased and has been more than ample to meet demand. The revised output and capacity indexes, shown in the middle panel of chart 6, are based largely on the unit counts mentioned above (left panel); the indexes also incorporate an upward adjustment of about 3 percent per year resulting from gains in the quality of vehicles—antilock brakes, airbags, more efficient engines, more amenities, and so on. The utilization rates for autos and trucks parallel the 4. Output and capacity in primary metals, cement, and lumber physical output data and indicate that the rate of capacity utilization, which had dropped from more than 80 percent in the mid-1980s to less than 60 percent at the trough, recovered to about 80 percent early in 1993. The utilization of light truck assembly capacity was much higher than that for automobiles; the capacity utilization rate for medium and heavy trucks also recovered strongly with output. Aerospace and miscellaneous transportation equipment. Output of transportation equipment aside from motor vehicles dropped 16 percent from the end of 1990 to early 1993, to its lowest level in seven years. Further curtailments in production seem inevitable. Output of aircraft and parts, boats and naval ships, and guided missiles is declining. (The only real strength is in heavyweight motorcycles and mountain bicycles, along with casino boats, ferries, and other smaller craft.) Sharp cutbacks in defense outlays have been the major drag; but the production of commercial transport aircraft, which doubled from 1987 to 1991, is also now falling. The boom in output of civil transport aircraft peaked in late 1991, although orders had already begun to decline. The boom was fueled by growing demand for air travel. Airlines were hit, however, by decreased air travel in 1991 in response to the Persian Gulf War and recession, by excess capacity, and by substantial price competition in 1992. New orders fell from more than 1,000 units in 1989 to an annual average of 243 units in 1991-92, and backlogs dropped as many airlines cancelled orders or delayed delivery past 1996 in response to record financial losses in 1991 and 1992. Deliveries Industrial Production, Capacity, and Capacity Utilization since 1987 5. Revised and earlier output, capacity, and utilization in advanced-processing industries Ratio scale, 1987 output = 100 — —140 Earlier capacity Earlier output Revised capacity • Revised output — 80 1 1 1 1 1 1 1980 1 1 1 1 1 1 1 1 1 1 1985 1 1 1 1 1 1 1 1 Percent of capacity Earlier utilization gg Revised utilization 75 1 1 1 1 1990 1 1 peaked at about 160 planes a quarter in the first half of 1992 but dropped to 110 in the first quarter of 1993. Airframe makers announced further production cuts for 1993 and 1994; much of the current backlog is not scheduled to be delivered until the last half of the decade. Shipments of complete military aircraft have fallen from about 1,200 units in 1987 to about 600 units in 1992 and 1993. With the sharp cuts in production, employment and capacity utilization in the aerospace and miscellaneous transportation industries have dropped substantially. The utilization rate fell from 88 percent at its peak in the second quarter of 1989 to 70 percent in early 1993. 597 Machinery and instruments. The diverse industries that produce machinery, instruments, and parts include fast growers like computers, semiconductors, communications equipment, and medical instruments along with others that produced less at their recent peaks than they had in the early 1980s. The output of industrial and commercial machinery and computer equipment grew 4.5 percent per year from 1987 to 1992;2 but the pace was less than half that if office and computing machines are excluded. Because of the phenomenal increase in computers' performance per dollar, the index for real production of computer and office equipment has doubled since 1987. Much of the output gain was registered during 1992 when the U.S. computer industry emerged from a prolonged downturn. In 1991, shipments in current dollars were about 8 percent below their peak in 1988 and only a few percentage points higher than they were in 1987; employment in the computer and office equipment industry dropped 100,000 from its peak in 1984 to 416,600 in 1991. Excluding computers, output of nonelectrical machinery, which dropped about a tenth from peak to trough, recovered strongly in 1992 but remained below its 1989 high. Makers of engines and of farm and construction machinery produced substantially less in 1992 than in 1980. In 1992, a rebound in residential construction, increased public construction, and the end of a strike at a major producer boosted sales of construction machinery. Nevertheless, because of weakness in commercial construction of office and apartment buildings and the low 2. Standard Industrial Classification (SIC) 35, formerly called Nonelectrical Machinery. 6. Physical counts and Federal Reserve measures of output, capacity, and utilization for autos and light trucks Ratio scale, millions Ratio scale, 1987 output = 100 Ratio scale, percent FR capacity index Physical capacity Physical output I 1980 1985 1990 Li 1980 I I I I I I I I I I I II 1985 1990 1980 1985 1990 598 Federal Reserve Bulletin • June 1993 level of industrial plant expansion, the level of output of construction and mining equipment remains near the weak 1987 level, far below earlier peaks. Although recovering somewhat late in 1992, output of farm equipment also remains below earlier peaks. Fewer farmers, declines in net farm income and the real purchasing power of farm equity, productivity gains, and conservation tillage (which requires fewer trips and reduces wear on the tractor) have reduced the sales of farm equipment. The production of electrical machinery, which had flattened in 1989-90, advanced sharply from the trough to new highs. Bolstered by gains in semiconductors and communications equipment, output increased at a 33/4-percent annual rate from 1987 to 1992. With a double-digit gain in 1992, the production index for semiconductors and related components has risen more than 50 percent since 1987, whereas prices of semiconductors have drifted down. This strong growth is related to the increasing use of semiconductors and related devices in computers, communications equipment, and various recovering industries such as motor vehicles. The output of communications equipment, which eased a bit in the recession, rose sharply in 1992 to a level more than 25 percent higher than that in 1987. One source of the strength is the robust growth of the cellular radiotelephone system and of fiber optics. During 1992, cellular service became available in each U.S. market block, and the number of new cellular subscribers increased more than 200,000 per month to about 10 million by the end of the year. Net exports of radio and television communications equipment have risen substantially in recent years. Other components of electrical machinery exhibited less robust growth. The output of appliances and television sets and of electric motors and generators and related parts dropped sharply in the recession and exhibited moderate growth through 1992. In the first quarter of 1993, output of appliances and television sets rose to 121 percent of 1987 output. However, the output of lighting and wiring products, storage batteries, and transformers and switchgear was lower at the end of 1992 than it was in 1987. In contrast to the cyclical fluctuations of motor vehicles, some machinery, and miscellaneous man- ufactures, the output of instruments has been relatively flat since 1988. The medical instrument business has been the only strong sector; the output of guidance and navigation equipment has fallen substantially with the decline in defense spending. The rate of capacity utilization for the overall instruments industry is low. As in the case of instruments, the industrial production index for manufactured nondurable goods has in recent years exhibited a muted cycle and a slow rate of growth. Among advanced processors, the output of foods grew only about PA percent per year from 1987 through 1992— about half as fast as in the preceding five years. Changing tastes and lifestyles and reduced family size have shifted production from beef, liquor, whole milk, and large cakes and pies to poultry, beer, skim milk, frozen yogurt, and frozen convenience foods. The production of tobacco products has been trendless for a decade. In contrast, the output of finished chemicals grew more rapidly; this growth was led by drugs and medicines, which advanced a third from 1987 to early 1993. The industrial production indexes for printing and publishing, paints, apparel, and leather goods, however, were lower in early 1993 than in 1987. A continued uptrend in imports of apparel and leather goods contributed to that decline. The output of printed products was reduced in the early 1990s partly because of a decline in advertising revenues during the recession, which also restrained demand for business publications and forms. A drop-off in corporate takeover activity led to less financial printing. Declines in tax revenues cut school and library budgets for educational materials. Newspaper industry receipts in 1992 declined for the fifth year as newspapers' share of total media advertising and the circulation of daily newspapers shrank further. Mining From 1987 to mid-1991, mining production, as a whole, changed relatively little, but afterward it declined a few percentage points. The easing was due partly to weak demand for coal, stone, and earth minerals but mainly to the renewed decline in crude oil production and the low rate of oil and gas well drilling that developed as the price of oil Industrial Production, Capacity, and Capacity Utilization since 1987 retreated after the defeat of Iraq. The estimated index of mining capacity declined as well. Capacity utilization edged down in 1992 and stayed within the 85-90 percent range of recent years (chart 7). Mining of metal ores increased sharply from the depressed levels of the mid-1980s. New technology and new mines contributed to the doubling of production of gold and zinc ores since 1987; upgraded domestic facilities and disruptions in foreign supplies helped raise output of copper ore in the United States by 40 percent. Production of energy by mines, refineries, and utilities, representing about 15 percent of industrial production, has been sluggish for the past twenty years. A key factor has been the long-term downtrend in the production of crude oil and natural gas, which has dropped more than 20 percent since 1973. This decline has offset much of the gain in coal mining and nuclear generation of electricity. After a slight rise in 1991 related to the spurt in oil prices during the Persian Gulf crisis, production of domestic crude oil resumed its decline. From early 1991 to early 1993, it fell 500,000 barrels per day to 7 million barrels per day—the lowest level since 1960. Since 1988, when Alaskan output peaked, the daily rate of production has dropped a 7. Revised and earlier output, capacity, and utilization in mining Ratio scale, 1987 output = 100 Earlier capacity—120 Revised capacity Earlier output —110 Revised output Percent of capacity Earlier utilization 599 million barrels. For more than twenty years, output in the lower forty-eight states has been trending down—dropping from 9.4 million barrels per day in 1970 to 5.4 million in 1992. With the aging of 011 fields, oil well productivity has fallen to about 12 barrels per day per well from about 13.5 barrels in 1987-88 and more than 18 barrels in the early 1970s. Moderate prices of crude oil and environmental restrictions in some areas have depressed drilling activity in the United States. Drilling for oil and gas in terms of either footage or well completions has fallen to less than a third of its peak level in the early 1980s. The number of active or available rotary drilling rigs has also been shrinking. In contrast to that of crude oil, the output of natural gas, which also declined through 1986, has recovered; and, despite some weather-related weakness since the recession, coal has trended up. The gains in coal mining have been primarily west of the Mississippi. Refinery production, which had recovered from its lows in the early 1980s, has been basically flat since 1988. Total refinery production of motor gasoline had fallen to 6.3 million barrels in 1982-83 because of the high price of oil and recovered to 6.8 million barrels in 1986-87, when the price of oil fell. From 1988 to 1992, it stayed at 7 million barrels per day, about the same as in the late 1970s. Distillate fuel oil has equalled nearly 3 million barrels per day in the past few years, below the rate in the late 1970s but up from that in the mid-1980s. In 1992, refinery capacity shrank. More stringent requirements mandated by the Clean Air Act Amendments of 1990 for summer gasoline vapor pressure and oxygenated gasoline, as well as the upcoming reduction in allowable sulfur content of diesel fuels, necessitated the upgrading of existing refineries. Several idle marginal refineries permanently closed. The Department of Energy reports that, at the start of 1993, operable crude distillation capacity dropped to 15.1 million barrels per day, down about 500,000 barrels per day from its average level during 1985-92. Input to crude oil distillation units rose so that utilization increased from 86 percent in 1991to88 percent in 1992. this Revised utilization rate is moderate for refining; it is well above the low rates of the early 1980s, when the high price of oil cut demand, but below the rates in the decade before the Arab oil embargo. 600 Federal Reserve Bulletin • June 1993 demand is expected to reduce the margin of excess capacity a few percentage points. Utilities From 1986 to 1989, production by electric and gas utilities increased 13 percent; it was spurred by relatively low energy prices and a temporary surplus of deliverable natural gas that caused a rebound in consumption, particularly industrial consumption, of natural gas from its 1986 low. The growth in sales by electric and gas utilities slowed in 1990-92 because of episodes of mild weather and economic weakness. Cool weather caused the generation of electricity to decline in the summer of 1992, but stronger industrial demand for power and a return of more normal weather boosted utility sales in late 1992 and early 1993 (chart 8). The growth of capacity at utilities in the past few years has kept up with the slow growth of output so that the rate of capacity utilization has changed little. However, the utilization rate is projected to rise. According to the North American Electric Reliability Council, the nation's utilities intend to increase generating capacity at an annual rate of about IVi percent between 1992 and 2001, compared with a projected annual growth in summer peak demand of l4/s percent. The more rapid rise in 8. Revised and earlier output, capacity, and utilization in utilities Ratio scale. 1987 output = 100 Revised capacity — __ ^ ^ Earlier capacity— 120 Percent of capacity Revised utilization 1980 1985 1990 SIZE OF THE REVISION The downward revision in industrial production was centered in manufacturing, especially in nondurable goods industries other than textiles, paper, and leather goods. The growth of nondurables from 1987 through 1992 was cut in half, to 1 percent per year (table 3). Especially large downward revisions were made to printing and publishing and to paving and roofing materials (part of petroleum products); output in these industries as well as in apparel and leather products was lower in 1992 than it had been in 1987. The output indexes show foods, tobacco products, apparel, and rubber and plastics products growing more slowly than they were previously shown to grow. In durable manufacturing, several downward revisions, especially to fabricated metal products, instruments, and miscellaneous manufactures, were largely offset by upward revisions to electrical machinery and transportation equipment. For durable manufacturing, the greater rebound from the trough shown by the revised index offset the lower levels in 1989 to 1991, so that by the end of 1992 the revised index exceeded the earlier figures. For mining, particularly for coal, oil, and gas, the overall 1987-92 revision in output was small. For most series, monthly physical output figures, supplied by the Bureau of Mines or the Department of Energy, were adjusted to more complete annual data from the same sources. This process typically affected specific year-to-year movements rather than the overall 1987-92 rate of growth. In the case of stone and earth minerals, however, monthly output was estimated largely on the basis of kilowatt hours purchased by that industry. These estimates were revised substantially downward to match the annual physical product figures provided by the Bureau of Mines. The output index for utilities was revised upward because of a correction to the measurement of gas transmission (the output of electric utilities was revised only slightly). Previously the sales of gas by major pipeline companies were used to measure monthly transmissions. However, most interstate pipeline companies have become open-access Industrial Production, Capacity, and Capacity Utilization since 1987 transporters and, since 1987, have increasingly transported gas owned by others. As a result, sales of gas owned by pipelines fell far below transmissions. In this revision, pipeline sales were replaced by cubic feet of natural gas delivered to consumers. Whereas before the revision a slight decline was shown, the new series shows that gas transmission has not been falling; from 1987 to 1992, output of gas utilities including transmission grew at an annual rate of 2.5 percent. REVISIONS TO CAPACITY The growth of industrial capacity from the end of 1986 to the end of 1992 averaged 1.7 percent per year, 0.6 percentage point lower than the rate shown before the revisions (table 4). In manufacturing, large downward revisions to output and capacity indexes are evident in printing and publishing, instruments, and miscellaneous manufactures. As explained below, the downward revisions in capacity growth reflect not only new data on capacity and utilization but also the downward revisions in the industrial production indexes. The revised capacity indexes are derived from (1) the survey by the U.S. Bureau of the Census of utilization rates in manufacturing establishments for the fourth quarter of years through 1990, (2) output and capacity data in physical units from various sources through 1992, and (3) estimates of capital stock derived through the perpetual inventory method from investment spending by industry.3 Investment spending comes from the Annual Survey of Manufactures (ASM) through 1991 and from the Census Bureau's quarterly survey of plant and equipment expenditures after 1991. The Federal Reserve indexes of sustainable annual capacity are designed specifically to accompany the indexes of production and are also expressed as percentages of production in 1987. A basic step in estimating annual levels of the capac- 3. A methodology of the capacity and utilization measures is found in Richard D. Raddock, "Recent Developments in Industrial Capacity and Utilization," Federal Reserve Bulletin, vol. 76 (June 1990), pp. 411-35, especially pp. 424ff. One of the key sources is the U.S. Bureau of the Census: "Survey of Plant Capacity," Current Industrial Report MQ-C1, for various years. This survey provides utilization rates, not capacity estimates, for manufacturing establishments at the four-digit SIC level. 601 ity index is dividing an industrial production (IP) index by a utilization rate provided by an outside survey (Us), that is, implied capacity = IP/Us. Thus, if in 1987, IP = 100, and Us = 80 percent, then implied capacity = 100/0.8 = 125. For the most part, utilization rates from surveys are revised only slightly, if at all. Thus, the Federal Reserve capacity indexes are typically revised with industrial production indexes, and the Federal Reserve rates of utilization change relatively little on average in a revision (table 5). The sharper increase in 1992 in the revised industrial production indexes, however, has raised utilization above its unrevised level in the fourth quarter of 1992. This revision was conducted at the end of a very sluggish period. Given the lack of direct capacity measures, the capacity indexes are often inferred indirectly. Making such inferences when output growth has been particularly slow and utilization rates are relatively low has the danger of yielding underestimates of capacity and its growth. Yet, an alternative measure of capacity utilization reported by the National Association of Purchasing Management, Inc., currently shows higher rates of utilization in manufacturing and, implicitly, a lower index of capacity. TECHNICAL ASPECTS OF THE REVISION In some respects, the revised production indexes look much the same as before. Most noticeably, the 1987 weight and comparison base has been maintained, and the structure of the major market and industry groups has remained basically the same. However, the updating of monthly data and the introduction of comprehensive annual data from the ASM have significantly affected the level and the movement of the indexes. Many smaller changes were also made in the revision. The structure was modified to conform to the 1987 Standard Industrial Classification (SIC). Some sources of data were lost, and so some series based on those sources were dropped or combined with other series. However, the introduction of new series increased the number of individual series to 255. Monthly indicators for other series also changed. For example, some series that had been based on an industry's monthly purchases of electricity (kilowatt hours) became based on monthly 602 4. Federal Reserve Bulletin • June 1993 Compound annual rates of growth in end-of-year capacity, by major industry group, 1966-92 Percent Item Total Industry 1986-92 Difference between revised and earlier rates for 1986-92 1966-92 1966-74 1974-82 1982-86 2.8 3.9 2.9 2.4 1.7 -.6 3.2 4.1 3.3 3.2 2.1 -.7 Primary processing Advanced processing 2.1 3.8 4.2 4.1 1.6 4.2 .4 4.5 1.3 2.4 -.5 -.7 Durable Lumber and products Furniture and fixtures Stone, clay, and glass products 3.5 1.7 3.1 1.3 3.8 3.1 4.9 2.5 3.8 .8 2.6 1.4 4.0 2.4 2.1 .6 2.2 .5 2.0 .1 -.4 -2.0 -.4 -.7 -.1 -.9 -1.1 1.3 -.4 1.4 1.8 .7 .2 3.8 1.2 5.6 .2 -.1 .0 .7 -.7 1.5 -3.8 -5.9 -6.0 -.3 -3.6 -5.6 -.5 -.7 -1.0 -.1 .0 .8 -.2 .1 -.3 -.6 -2.0 .2 Manufacturing Primary metals Iron and steel Raw steel Nonferrous Primary copper Primary aluminum Fabricated metal products Industrial and commercial machinery and computer equipment Electrical machinery 1.6 3.2 1.7 .1 .4 -.6 6.4 5.2 4.7 6.4 8.8 5.4 9.3 4.8 3.4 3.7 -.5 .1 Transportation equipment 2.7 3.0 2.0 3.5 2.7 .6 Motor vehicles and parts1 Autos and light trucks Aerospace and miscellaneous Instruments Miscellaneous 3.2 4.6 1.8 2.i 5.4 2.1 i.3 7.8 4.9 i.i 5.6 .9 2.5 5.7 4.2 4.9 .0 3.7 1.8 1.8 2.4 1.6 2.1 .1 -.8 -2.7 -.7 Nondurable Foods Textile mill products Apparel products Paper and products Pulp and paper Printing and publishing 2.9 2.5 2.0 1.3 2.7 2.4 3.2 4.5 3.0 4.7 2.6 4.1 3.3 3.1 2.5 3.0 .8 1.0 1.9 1.5 3.4 2.1 2.2 .3 1.7 2.2 2.1 4.5 1.9 1.4 1.1 -.2 2.4 2.7 2.1 -1.1 -1.1 -.5 -2.0 .1 -.1 -3.1 Chemicals and products Plastics materials Synthetic fibers 3.9 7.0 4.4 7.1 13.4 9.9 2.9 5.0 2.8 1.1 2.3 -.7 3.0 4.6 3.2 -.3 -3.2 2.4 1.6 5.5 -3.2 4.5 9.2 -1.2 1.8 3.6 -3.8 -1.2 5.6 -5.6 -.4 3.2 -3.1 -.8 -.7 -.4 Mining Metal mining Coal Oil and gas extraction Oil and gas well drilling Stone and earth minerals .0 1.4 2.6 -.6 .7 .9 -.3 .5 2.4 -1.2 -.8 2.7 2.2 1.0 3.6 2.5 17.4 .2 -.2 -2.0 2.0 -.3 -5.1 -.1 -2.2 5.5 1.8 -3.9 -12.8 .2 -.4 -1.0 -.4 .0 -.3 -3.3 Utilities Electric Gas 3.1 4.2 .3 6.3 8.2 2.6 2.1 3.3 -1.0 1.0 1.8 -1.5 1.5 2.0 .2 .2 .2 .0 Petroleum products Rubber and plastics products Leather and products 1. Series began in 1977. production-worker hours. Seasonal factors were recalculated.4 Typically, either monthly output or monthly input data are used to estimate individual production indexes. Monthly output or shipments in physical units from many private or government 4. A table "Industry structure and series composition of industrial production: classification, value added weight, and descrip- sources are the basis for 123 series that represent 36 percent of the total index. Input data constitute 74 production-worker-hour series (34 percent of tion of series" is available with a diskette of historical data of industrial production, capacity, and capacity utilization from Publication Services, Board of Governors of the Federal Reserve System, Washington, DC 20551. A typed structure table may be obtained from the Industrial Output Section, Division of Research and Statistics. Industrial Production, Capacity, and Capacity Utilization since 1987 5. 603 Revised and earlier capacity utilization rates, by major industry group, 1 9 8 7 - 9 2 1 Percent of capacity, seasonally adjusted Revised Item Earlier 1987-92 average 1988-89 high 1990-91 low 1992:Q4 1987-92 average 1988-89 high 1990-91 low 1992:Q4 Total industry 81.7 84.8 78.3 80.7 81.8 85.0 78.4 79J Manufacturing 81.0 85.1 76.6 79.6 81.3 85.1 77.2 78.2 Primary processing Advanced processing 84.1 79.8 89.1 83.3 77.9 76.1 82.7 78.3 84.4 80.0 89.0 83.6 77.9 76.6 82.2 76.6 Durable Lumber and products Furniture and fixtures Stone, clay, and glass products 78.7 86.7 80.9 79.0 83.9 93.3 86.8 83.7 73.8 76.8 71.7 71.0 77.7 87.6 79.8 77.7 79.3 83.1 82.8 79.3 84.0 91.2 88.3 86.4 74.8 72.9 74.5 70.8 75.6 80.1 76.0 74.6 Primary metals Iron and steel Raw steel Nonferrous Primary copper Primary aluminum 82.5 81.5 81.8 83.9 79.4 95.8 92.9 95.7 92.7 88.9 85.9 100.4 74.3 72.3 71.2 75.9 73.6 97.3 81.2 80.8 81.2 81.8 87.1 97.8 82.9 80.8 80.7 86.3 81.9 97.2 91.6 92.0 94.1 95.0 97.9 103.5 73.6 68.7 67.1 81.1 68.8 97.7 82.5 82.2 78.6 83.0 89.6 99.3 Fabricated metal products Industrial and commercial machinery and computer equipment Electrical machinery 77.2 82.0 71.7 75.1 79.5 85.1 73.9 76.9 77.9 80.4 83.7 84.9 73.0 76.8 81.7 81.2 78.3 79.2 83.5 83.1 74.7 75.1 78.5 74.9 Transportation equipment Motor vehicles and parts Autos and light trucks Aerospace and miscellaneous Instruments Miscellaneous 76.6 72.3 73.4 81.0 77.9 77.0 84.2 84.5 89.6 88.3 81.2 80.1 70.1 57.9 53.6 78.1 75.1 72.9 72.0 72.1 74.9 72.0 73.2 77.3 77.2 75.0 71.2 79.2 78.4 81.4 84.6 85.5 83.6 86.2 83.9 85.5 70.1 58.1 47.4 72.3 74.8 80.4 70.1 75.3 73.8 65.5 71.1 80.2 84.1 81.7 87.8 80.2 91.1 93.7 85.2 86.8 83.3 92.1 84.2 94.9 98.1 92.3 80.4 80.8 78.7 74.6 86.0 90.2 78.4 82.1 81.1 90.1 78.6 88.4 91.0 77.2 84.0 81.0 88.1 79.3 91.4 93.3 85.6 86.7 83.0 91.2 84.2 95.8 97.7 90.4 80.3 79.7 80.2 71.5 86.5 87.2 81.2 81.9 79.4 89.1 73.9 88.8 91.8 78.3 82.2 89.5 89.8 86.0 85.2 79.9 85.9 97.0 99.7 88.5 90.5 83.8 78.5 75.5 77.3 84.2 78.5 75.4 81.4 82.8 86.8 89.7 82.3 85.4 81.8 90.7 86.3 87.3 86.5 79.4 86.8 98.9 94.5 90.3 90.4 88.4 77.9 79.0 72.5 86.2 79.0 71.4 81.7 82.0 83.0 90.7 85.0 75.1 Mining Metal mining Coal Oil and gas extraction Oil and gas well drilling Stone and earth minerals 85.8 81.4 86.7 86.3 54.0 83.9 87.0 87.5 91.4 86.9 60.7 90.0 86.8 79.5 83.1 87.8 54.0 77.6 87.4 87.3 81.6 90.0 65.0 79.5 85.7 78.0 86.7 86.5 53.5 85.2 87.2 87.2 94.4 86.6 58.8 94.3 86.2 73.6 81.6 86.2 51.2 76.1 86.2 79.1 80.2 90.6 62.0 73.5 Utilities Electric Gas 85.0 88.2 74.6 92.6 94.8 85.5 83.4 87.4 68.3 87.1 89.0 80.7 84.3 89.1 69.4 92.3 96.2 80.3 81.6 87.0 62.3 86.2 91.1 70.2 Nondurable Foods Textile mill products Apparel products Paper and products Pulp and paper Printing and publishing Chemicals and products Plastics materials Synthetic fibers Petroleum products Rubber and plastics products Leather and products 1. The "high" columns refer to periods in which utilization generally peaked; the "low" columns refer to recession years in which utilization generally bottomed out. The monthly highs and lows are specific to each series, and all did not occur in the same month. the total index) and 40 kilowatt-hour series (27 percent). Each of these types of monthly data has been updated or revised. Quarterly production data in physical units have been introduced to maintain the representation of physical measures even though the Census Bureau and other sources have discontinued the monthly publication of some of these data. The quarterly production data are the basis for sixteen series that represent 2 percent of the total industrial production index. A cubic spline generally is used to interpolate monthly values from the quarterly figures. Revised Federal Reserve indexes of electric power use by industry from 1986 were published in February 1993 and are incorporated in the new industrial production indexes for monthly components based on the use of electricity. The Federal 604 Federal Reserve Bulletin • June 1993 Reserve Banks conduct a voluntary monthly survey of electric utilities, which report sales to industries classified by SIC codes; the respondents also include some industrial cogenerators. The revision reflects conversion of the power series since January 1987 to the 1987 SIC and the incorporation of more comprehensive annual and monthly source data, where available. New power series include indexes for converted paper products (SIC 267) and plastics products (SIC 308) and exclude indexes for SIC 264, 266, and 307, which no longer exist in the 1987 SIC. The U.S. Bureau of Labor Statistics (BLS) revises its monthly survey data to new levels based on the number of employees covered by unemployment insurance in March. The last available benchmark was for March 1991. In the estimation of the Federal Reserve production indexes, the monthly worker hours (whether or not benchmarked by BLS) are further adjusted to annual production levels derived largely from the ASM. Estimates of real output derived from the ASM for 1988 through 1991 determine most of the revised annual indexes of production in manufacturing; the Census of Manufactures, a more complete count of the universe, provides indexes for 1982 and 1987 and will do so for 1992. Historically, the ASM figures tend to show less growth than do those from the census. Also, the introduction of a new panel of respondents in 1989 apparently caused an understatement of growth in that year. Consequently, the estimates of output derived from the ASM were adjusted upward by V2 percent in 1988 and about IV2 percent in the years from 1989 to 1991. As shown by table 6, the Federal Reserve's index of manufacturing output has been revised downward to levels close to the adjusted levels derived from the ASM.5 Some of the individual production indexes are benchmarked to annual data that are expressed in physical volumes, such as tons of steel or gallons 5. Gross output at the four-digit SIC industry level equals value added plus the cost of materials. The current dollar figures from the ASM are deflated, for the most part, by the BLS's producer price indexes. The main exception is the hedonic price index used to deflate computers. The deflated four-digit industry output figures are indexed on a 1987 base, weighted with proportions based on value added in 1987 reported in the Census of Manufactures, and aggregated. This is essentially the same method of aggregation used to combine the Federal Reserve's indexes of production. of gasoline, rather than to deflated output figures derived from the ASM. This alternative form of data accounts for some slight difference between the Federal Reserve and ASM-based indexes of output. Cyclical movements in productivity are used in estimating those monthly indexes based on production-worker hours or kilowatt hours of electricity used by industrial plants. Through 1991, the movements in output per hour can be inferred by adjusting the monthly hours data to more comprehensive annual output measures, such as those developed from the ASM figures. Given the lack of such annual output data since 1991, the cyclical rebound in productivity since then must be estimated from other information such as (1) the movements of output-input ratios in previous cyclical recoveries and (2) the productivity changes shown in series based on monthly output data in physical units. Other indicators of current production, such as manufacturers' shipments and inventories in constant dollars, are used to corroborate the current trends in output-input ratios. Because the revised industrial production indexes follow the 1987 SIC, a number of changes—including splits or recombinations of series—occurred. One change involved the shift of some military equipment from SIC 36, Electrical Machinery, into SIC 38, Instruments; this shift lowered the growth of this relatively small industry group more noticeably than it raised the growth of the larger electrical machinery group.6 6. Manufacturing output Index, 1987 average = 100 Federal Reserve Year 1988 1989 1990 1991 1992 Annual Survey of Manufactures Earlier Revised Unadjusted Adjusted 105.8 108.9 109.9 107.5 109.7 104.7 106.4 106.1 103.7 106.9 104.5 104.8 104.9 102.1 n.a. 104.9 106.4 106.1 103.7 n.a. 6. More specifically, search, detection, navigation, and guidance systems and equipment, part of old SIC 3662, were transferred to part of new SIC 3812; hydrological, hydrographic, meteorological, and geophysical equipment, (also part of old SIC 3662) to part of SIC 3829, Measuring and Controlling Devices, not elsewhere classified; and X-ray apparatus and tubes (old SIC 3693) to SIC 3844,5. Industrial Production, Capacity, and Capacity Utilization since 1987 The separate series on government-owned and -operated army, air force, and navy ordnance facilities and navy shipyards were eliminated because the ASM and the Census of Manufactures provide no annual data for benchmarking the available employment data. In calculating new seasonal adjustment factors, the staff applied the X-11ARIMA program of Statistics Canada to data through October 1992. Seasonal factors were forecast twelve months ahead to October 1993. In cases in which cyclical movements appeared to distort seasonal factors, some original values were replaced with maximum likelihood estimates of more typical values before running the X-l 1ARIMA program. A prior adjustment for Easter, which may fall in March or April, was also made for some physical product or kilowatthour series. The Easter adjustment factor was later combined with the factor computed by the X-l 1 to get the final seasonal factor. For production-worker hours, some prior adjustment may have been required when holidays, specifically Easter and Labor Day, occurred during the pay period containing the survey week for the BLS employment survey. • 605 Availability of Output, Capacity, and Utilization Estimates Current estimates of output, capacity, and utilization are published first in the Federal Reserve statistical release G. 17(419), "Industrial Production and Capacity Utilization," and then in the statistical tables of the Federal Reserve Bulletin. All data shown in the release will be available on the day of issue through the Department of Commerce's online Economic Bulletin Board (202-377-3870). Diskettes containing either historical data (through 1985) or revised data (from 1986 to those most recently published in the G.17 statistical release) are available from Publications Services, Board of Governors of the Federal Reserve System, Washington, DC 20551 (202-452-3245). Estimates for total industry and manufacturing, January 1981 to the latest available month in 1993, are shown in tables 5A and 5B of the G.17 statistical release. Hard copy of the revised estimates of series shown in the G.17 release is available upon written request to Industrial Output Section, Mail Stop 82, Division of Research and Statistics, Federal Reserve Board, Washington, DC 20551. A table "Industry structure and series composition of industrial production: classification, value added weight, and description of series" is also available upon written request to the Industrial Output Section. A similar table is available for the capacity indexes. 606 Industrial Production and Capacity Utilization for March 1993 The revised data described in the previous article were released for publication on May 14. What follows is the summary of the earlier, unrevised indexes released on April 15. Industrial production was unchanged in March, after having shown strong gains since October. In part, the slowdown reflects the loss of output after the severe mid-March storm along the East Coast; Industrial production indexes Twelve-month percent change Twelve-month percent change Durable manufacturing I 1988 1989 1990 1992 1991 1988 1993 1989 1990 1991 1992 1993 Capacity and industrial production Ratio scale, 1987 production = 100 Ratio scale, 1987 production = 100 140 — Manufacturing — — 120 - - - 100 — Total industry Capacitv Production 1 1 1 1 1 1 1 Capacity 1 I 1 1 1 1 1 1 1 1 1 1 I 1 1 1 Percent of capacity Utilization Utilization 1983 100 Manufacturing Total industry J 120 - 80 Percent of capacity 1981 — Production 80 1 140 — I 1985 I I 1987 I I 1989 I I L 1991 J 1993 1981 1983 1985 All series are seasonally adjusted. Latest series, March. Capacity is an index of potential industrial production. 1987 I 1989 I I 1991 I L 1993 607 Industrial production and capacity utilization 1 Industrial production, index, 1987=100 Percentage change Category 1993 1992 2 1993 2 1992 Dec. r r Jan. Feb/ Mar. P 112.0 Total 110.0 111.4 112.0 r 1 r Jan. Feb. .5 .3 .6 .4 .5 .4 Dec. Mar.P Mar. 1992 to Mar. 1993 .0 4.1 Previous estimate 110.8 111.3 111.8 Major market groups Products, total3 Consumer goods ... Business equipment Construction supplies Materials 112.3 113.4 130.2 98.4 109.0 112.7 113.4 131.8 99.5 109.3 113.3 114.2 133.0 100.7 110.0 113.3 114.0 133.4 100.5 110.0 .9 .7 1.9 -.5 .0 .3 .0 1.3 1.2 .3 .5 .7 .8 1.1 .6 .0 -.1 .4 -.2 .0 4.4 4.3 9.8 3.9 3.7 Major industry groups Manufacturing Durable Nondurable Mining Utilities 111.8 111.2 112.7 98.5 114.2 112.8 112.4 113.2 98.0 110.1 113.3 113.3 113.4 95.1 114.6 113.4 113.4 113.3 94.0 115.6 .5 .9 .0 -.9 1.7 .8 1.1 .4 -.5 -3.6 .5 .7 .1 -3.0 4.1 .1 .1 .0 -1.2 .8 4.5 6.0 2.7 -3.6 7.3 MEMO Capacity utilization, percent 1992 Average, 1967-92 Low, 1982 High, 1988-89 1993 Mar. Dec.r Jan.r Feb.r Mar.P Capacity, percentage change, Mar. 1992 to Mar. 1993 Total 82.0 71.8 85.0 78.4 79.6 79.8 80.1 79.9 2.1 Manufacturing Advanced processing Primary processing .. Mining Utilities 81.3 80.8 82.3 87.4 86.6 70.0 71.4 66.8 80.6 76.2 85.1 83.6 89.0 87.2 92.3 77.5 76.1 80.8 84.9 83.1 78.5 77.0 82.2 85.8 87.5 79.0 77.4 83.0 85.4 84.3 79.2 77.5 83.5 82.8 87.7 79.1 77.3 83.5 81.8 88.3 2.4 2.9 1.0 .1 .9 1. Data seasonally adjusted or calculated from seasonally adjusted monthly data. 2. Change from preceding month. available evidence suggests that these losses were only partly made up by month-end. The industries most affected by the storm include textiles, steel, furniture, tobacco, and coal mining, although the exact magnitudes of these effects are tentative. Overall, the output of consumer goods, intermediate products, and materials were little changed in March; the production of business equipment increased 0.4 percent after an average gain of more than 1 percent a month since October. At 112.0 percent of its 1987 average, total industrial production was 4.1 percent above its year-ago level. Total industrial capacity utilization declined 0.2 percentage point, to 79.9 percent. Within consumer goods industries, declines in the production of motor vehicles and gasoline were mostly offset by gains in the output of appliances and residential utilities. The deceleration in busi 3. Contains components in addition to those shown, r Revised, p Preliminary. ness equipment reflected a small decline in the production of industrial equipment, which had grown more than 0.5 percent a month since October, and a slight easing in the pace of production of information-processing equipment, which had grown at a rapid pace since December. Cutbacks in the output of defense and space equipment continue to weaken the industrial sector: During the past few months, production has fallen an average of more than Vi percent a month. Production of construction supplies slipped back slightly after increasing more than 1 percent in each of the preceding two months. An increase in the output of nondurable materials was offset by a decline in energy materials. Much of the increase in nondurables reflected a pickup in paper production. Manufacturing output edged up 0.1 percent as production of durables moved up slightly. Most of 608 Federal Reserve Bulletin • June 1993 the impetus within durables came from the machinery industries, while production in most other industries either rose only slightly or declined. The largest decline was in transportation equipment, where aircraft manufacturing continued to contract; the output of motor vehicles and parts also decreased for a second straight month. Within nondurables, paper production increased notably, but the output of petroleum, textile, and tobacco products dropped. Capacity utilization in manufacturing edged down 0.1 percentage point, to 79.1 percent. Mining output declined, as continued weakness in oil and gas well drilling augmented the cutback in coal mining. The output of utilities picked up a little with the persistence of relatively cool temperatures. • 609 Statement to the Congress Statement by John P. LaWare, Member, Board of Governors of the Federal Reserve System, before the Subcommittee on Economic Growth and Credit Formation of the Committee on Banking, Finance and Urban Affairs, U.S. House of Representatives, April 2, 1993 I appreciate the subcommittee's invitation to discuss some of the factors influencing recent national and regional trends in bank lending as well as changes in the composition of banks' balance sheets. Traditionally, commercial banks have been central in financing economic activity. In recent years, their relative importance has diminished somewhat, as other financial intermediaries and direct market sources of funds have tended to substitute for bank credit. Nevertheless, commercial banks remain the major source of short- and intermediate-term business credit— and the dominant source of small business financing—and thus continue to have a key function in the financial system. The recent weakness in the growth of bank loans has raised the issue of how well banks have been playing their intermediation role and what their future contributions are likely to be. In view of the importance of these and related issues, I would like to commend the committee for holding these hearings. The weakness of bank lending to businesses over the past couple of years is in some part a continuation of the trend toward a smaller banking role to which I just alluded. A much more important factor, however, has been a considerable falloff in the demand for bank credit. This decline in demand has been mainly associated with a sharp reversal of some of the balance sheet trends that developed during the 1980s. These efforts to strengthen balance sheets have had a pronounced effect on the demand for bank credit from both the household and, especially, the business sectors. A related need by banks to repair their own balance sheets has led to a tightening of banks' lending standards and terms even as demands for their loans were dropping. The resulting pattern of weak lending has been apparent across much of the United States, but the timing and severity of the slowdown have varied somewhat by region. In the remainder of my remarks, I will expand on this brief summary of recent developments. As the data that the banking agencies have assembled for the subcommittee indicate, the pace of expansion of the assets and deposits of depository institutions has been quite slow or negative in the past few years after a considerable advance in the 1980s. The growth of loans, particularly business loans, has been sluggish, although banks and other depositories have acquired large volumes of U.S. government and agency securities. The pattern of bank lending and the condition of banks have not been uniform across the United States and have mirrored the unevenness of economic developments. Perhaps the New England area provides the best-known regional aspect to the credit crunch. The boom in the 1980s was unusually strong in this region, particularly with respect to real estate, and the fall in the 1990s was commensurately sharp. The experience in New England points up the interconnections between the real and financial economies: As the New England economy softened and real estate prices stopped rising and began to fall, the quality of bank portfolios deteriorated rapidly, causing current and prospective declines in bank capital and generating a need to constrain lending. Of course, as the economy contracted, loan demand also fell. But the drop in loans on the books of New England banks doubtless was sharper than would have been the case had these banks felt better capitalized. As banks were intent on quickly improving capital ratios and reducing their exposure to further loss, some creditworthy borrowers appear to have been denied credit. Such problems have surfaced in other parts of the United States as well. 610 Federal Reserve Bulletin • June 1993 The regional breakdown of the banking data indicates that commercial and industrial loans have declined in the past few years in all parts of the United States but particularly in the West, Southwest, and Northeast. These areas, of course, have had pronounced economic difficulties that likely developed independently of banking conditions. In every region, construction loans also have contracted substantially. Other loan categories show more variation, however. For example, residential real estate loans expanded in the central, midwestern, and southwestern regions but contracted in the Northeast and the West in the 1990-92 period. Even commercial real estate credit exhibited strength in some areas, such as the central and midwestern regions but declined in the Southwest and on the coasts. Total lending has been weakest in the Northeast, followed by the Southwest and the West. There are several reasons for weak loan growth. I will begin with the most important reasons: Households and businesses have opted to reverse the patterns of spending, investing, and borrowing that dominated the 1980s. As you are well aware, that decade was one in which households, businesses, and, of course, the federal government very substantially increased their use of debt. Households rapidly added to their mortgage and other loan liabilities. Businesses simultaneously acquired a very heavy debt burden. Their borrowing was in considerable part related to an unprecedented substitution of debt for equity, much of it associated with mergers, takeovers, or defenses against takeovers. During the decade ending in 1989, household debt rose at an average annual rate of about 11 percent, and growth of business debt over this period averaged only a bit less, 10 percent. The debt growth of these sectors exceeded the 8 percent average rate of expansion of nominal gross domestic product (GDP) over this period. This extraordinary exercise in leveraging by the business and household sectors was financed in no small part by banks. For example, business and consumer loans at banks both expanded at average annual rates of about 8 percent in the 1980s; for bank mortgage holdings, annual growth averaged 12 percent. When some of the assumptions upon which these trends were based—especially that inflation rates would continue unabated—proved incorrect, pressures to reverse the debt buildup and leveraging of the 1980s began to emerge. In particular, a collapse in commercial real estate undermined the assumption that this market provided a good investment vehicle for borrowers and sound collateral for lenders. When the economy began to exhibit recessionary behavior, businesses and households alike initiated efforts to reduce their debt burdens and strengthen their balance sheets. These efforts have focused not only on reducing debt levels but also on substituting equity for debt, extending maturities to enhance liquidity, and refinancing existing debt to lower interest costs. Therefore, the decline in debt owed by the business sector has been particularly focused on shorter-term instruments, including bank loans. In part, these loans have been paid down with the proceeds of equity issuance. After seven years of contraction, net funds raised in equity markets by nonfinancial firms turned around in 1991, and firms have been issuing new equity at record rates in recent quarters. Bank loans also have been paid down with funds raised in bond markets. In addition, a great deal of bond issuance has been directed toward refinancing existing high-cost bonds at lower interest rates. This process has greatly reduced the debt-service burdens on the corporate sector and has left business balance sheets considerably strengthened. It is fair to say, then, that much of the recent weakness in commercial and industrial loans is the result of vigorous efforts by businesses to improve the health of their balance sheets. At the same time, outlays to finance inventories and capital have been less than the volume of internal funds for nonfinancial corporations in the aggregate, further limiting firms' demands for bank or other credit. Some of the recent weakness in commercial and industrial lending by banks appears to be a continuation of a longer-term downtrend in the relative importance of this type of business credit. Reasons for this slippage include increased competition from other sources of business credit, such as finance companies and the commercial paper market. The key role played Statement by depressed demand in explaining the recent contraction in commercial and industrial loans is pointed up by the simultaneous marked weakness or outright declines in these competing sources of short-term credit to businesses. The weakness in bank loans to the household sector also appears to be mainly a demand side phenomenon. The sluggishness in housing prices and construction activity, for example, has likely depressed demand for mortgage credit, although the decline in home prices was nowhere near as severe as for commercial real estate. Perhaps more important, employment uncertainties that accompanied the economic downturn and the rather slow recovery caused households to take a more cautious approach to the use of debt. As a result, consumer credit outstanding contracted in 1991 and was little changed last year. In part, the anemic performance of consumer credit owed to paydowns using the proceeds of mortgages refinanced at rates that are well below consumer loan rates, particularly on an after-tax basis. In addition, weak consumer credit has been associated with the use of household financial assets, including bank deposits now yielding only 2 percent to 3 percent to pay down, or to limit, the growth of, loans. As with businesses, these efforts, although depressing bank lending and the level of consumer debt, have contributed to a marked strengthening of household balance sheets. The use of deposits and other monetary assets to constrain household debt growth, incidentally, has contributed to the very weak performance of the broader measures of the money supply over the past two years. Thus, rather than being indicative of a restrictive monetary policy or a lack of adequate funding for the economy, slow money growth rather is the obverse of the rechanneling of credit flows out of banks and into capital markets—in large part via rapidly expanding bond and equity mutual funds. These portfolio adjustments of households and businesses have been motivated largely, as I have suggested, by efforts to restore balance sheets that had gotten out of line in the 1980s. But the timing and pace of these restructuring activities have been related importantly to the very favorable trends we have seen in the equity and bond markets, trends that seem to have to the Congress 611 accelerated in the past few months. These developments, particularly the dramatic declines in longer-term interest rates, in turn, appear to owe heavily to the markets' perception that, at last, the federal government too is prepared to take meaningful steps toward putting its own financial house in order. Although sluggish loan growth at banks appears attributable largely to weak demand, it is clear that banks' appetite for loans has slackened over the past few years. The reason is that banks, too, found themselves in need of balance sheet restoration after the 1980s. This need was a result of the same realities their household and business customers were facing: The excessive loan liabilities of these latter groups had become the deteriorating loan assets of banks. The impact of these asset-quality problems on bank lending policies was intensified by increases in minimum acceptable capital ratios required both by regulators and by market forces. Our periodic surveys of bank lending officers confirm that a distinct shift toward tighter standards for approving loan applications as well as stiffer lending terms began several years ago. Greater stringency was most notable with respect to commercial real estate lending, but it was quite marked as well for business lending. The tighter terms have included lower ceilings on the size of credit lines offered, increases in the cost of these lines, and additional collateral requirements. Also, the relative cost of bank loans, as measured by the unusually wide spread between the prime rate and banks' cost of funds, is high. Although banks apparently ceased tightening in 1991, there has been little evidence of easing. In and of themselves, tighter lending standards and wider lending spreads in a time of an economic recession are not unusual. But the economy has been expanding now for two years, and the extended bout of stringency stands in some contrast to this pattern of economic growth. Besides suggesting the extent of needed balance sheet restructuring by banks, this prolonged period of adjustment may also reflect the increased costs of financial intermediation resulting from recent banking legislation. With demand for their loans weak, banks have bid for deposits unenthusiastically. Neverthe- 612 Federal Reserve Bulletin • June 1993 less, deposit inflows have exceeded banks' funding needs, and, partly to accommodate their deposit customers, banks have purchased securities in volume. This phenomenon is one in which this subcommittee has expressed an interest. Historically speaking, the ratio of security holdings to loans at banks is not at a particularly high level. Indeed, it was much higher in the period from the end of World War II to the early 1960s. Nor is the increase in the ratio over the past few years surprising because it typically rises in periods of economic weakness. Nevertheless, some observers have blamed the recent shift from lending to acquisitions of government securities on the Basle risk-based capital standards. As you know, banks must maintain minimum levels of two separate measures of capital: the ratio of equity capital to assets, a standard and traditional measure of leverage, and more recently, the ratios of two measures of capital to risk-adjusted assets. The latter requirements are the capital standards associated with the Basle Accord. They formally recognize what has long been known and understood—if not always acted upon—by bankers as well as their supervisors, namely that the amount of capital backing banks' assets ought to be related to the riskiness of those assets. At first glance, the Basle Accord would appear to have had an important causative role in recent changes in banks' portfolio composition away from loans and toward securities. This interpretation would seem to follow from the observation that, in the period leading up to the full implementation of these standards in December 1992, banks acquired substantial amounts of U.S. Treasury and agency securities, which have low or zero weights in computing risk-based capital ratios and registered corresponding declines in the portfolio shares of full-risk-weight loans. Because the purpose of the risk-based capital requirements was to better align risks with capital, it would be surprising if their introduction did not have some impact on banks' portfolio composition. For the preponderance of banks, however, considerable evidence suggests that the recent trend toward increased securities holdings much more reflects lackluster loan demand as described above than efforts to boost risk-based capital ratios., First, during this period most banks already met capital standards and thus were under no regulatory pressure to realign their portfolio. In addition, precisely the better capitalized banks in recent years have been acquiring the bulk of liquid Treasury and agency securities. This pattern, in turn, seems to reflect that it has been the banks with high risk-based capital ratios that also have had relatively high leverage ratios and have been most able to grow and accommodate deposit inflows. In an environment of depressed loan demand, deposit inflows were deployed to available assets, largely securities. A similar portfolio pattern of weak loan growth and strong security acquisitions has developed at credit unions—institutions not subject to the Basle Accord. As loan demand revives, the high levels of securities holdings at banks and other depository institutions likely will be drawn down as they were in numerous other cyclical upturns. Another important factor has been the development of the market for mortgage-backed securities, especially collateralized mortgage obligations (CMOs). The CMO market makes available mortgage-backed instruments that are more attractive to banks than standard mortgage passthrough securities because the effective maturities of some CMO tranches better match those of banks' deposit liabilities and thus serve to limit interest rate risk. Indeed, most of the growth in mortgage-related securities since 1990 has been in the form of CMOs, and acquisitions of government-backed or guaranteed mortgage-related securities have accounted for 45 percent of all purchases of U.S. government and agency securities over this period. In part, acquisitions of mortgage securities can be viewed as substituting for state and local bonds, which have run off since late 1986, when the tax-advantaged status of most of these instruments to banks was ended. Of course, bank purchases of mortgage-backed securities provide credit to mortgage markets just as do acquisitions of mortgages themselves. Even though the Basle Accord does not seem to explain the recent trend toward securities acquisition as currently structured, it does not adequately address the issue of interest rate risk that is potentially raised in banks' holdings of securities. Our examiners do, of course, take interest rate risk into account when evaluating Statement banks. To provide further guidance in this area to banks and examiners and to respond to requirements of the Federal Deposit Insurance Corporation Improvement Act of 1991 (FDICIA), the Board has developed a proposal for measuring interest rate risk in the context of the Basle Accord and earlier this week approved its publication for public comment. The steps that banks have taken in recent years to rebuild their balance sheets have been considerable and may well augur an increase in the availability of bank credit. Banks are very liquid, and lending rates relative to funding costs appear quite favorable, although banks must now cover expenses associated with recent legislation that were not present earlier. Reflecting wider lending margins and banks' efforts of recent years to control costs, bank profits last year reached record levels. Capital markets, meanwhile, have improved markedly, and banks took full advantage of these conditions by issuing a record volume of capital last year. As a result of the strong growth of capital, the share of loans in the banking system at well-capitalized banks by the end of last year climbed past 85 percent, and less than 1 percent was at less than adequately capitalized banks. Bank asset quality also has improved, as delinquency rates, while still high, have headed down. These developments suggest that banks have completed much of the adjustment necessary to attain comfortable balance sheets. Banks seem to be ready to lend when demand picks up. Indeed, there have been some tentative signs in recent months of a pickup in bank lending and a slowing in their acquisitions of securities. As funding conditions in capital markets have generally remained very favorable, business firms have continued to raise substantial volumes of funds there, and loan growth at larger banks has re- to the Congress 613 mained very weak. At smaller banks as a group, however, loan runoffs have ceased, and some growth has developed. The administration's initiatives on credit availability recently announced by the Federal Reserve and the other banking agencies should provide some help in stimulating loan growth, particularly for smaller borrowers. The already announced policy that would create for stronger banks a basket of loans to small and mediumsized businesses and farms for which documentation would not be reviewed by the examiner should help quite a lot. I also anticipate policy proposals that would reduce the burden of real estate appraisal requirements for most credit to smaller borrowers to be announced shortly. These changes will be within the FDICIA framework and are designed not to affect adversely the safety and soundness of banks and thrift institutions but are expected to reduce costs and lags in the small- and medium-sized business loan market. Other steps under consideration that would lower the cost and burden of the examination process are—as announced in mid-March—under active review by the banking agencies. To sum up, the past few years have been a difficult time for our economy and our financial institutions. During this period, the consequences of the excesses of the past decade have become apparent, along with the need to make fundamental adjustments. These adjustments have left their imprint on financial flows, particularly in the form of a slower pace of overall credit growth and, especially, restrained balance sheet expansion by depository institutions. Although this process has been trying, we are likely to emerge from it with leaner and more efficient banking institutions that are able to resume a central role in financing a growing economy. • 614 Announcements PUBLICATION OF DOCUMENTS ON MARKET RISK AND BANK CAPITAL BY THE BASLE COMMITTEE ON BANKING SUPERVISION The Federal Reserve Board made available on April 30, 1993, for public comment several documents on market risk and bank capital developed by the Basle Committee on Banking Supervision under the auspices of the Bank for International Settlements. The public comment period extends through year-end 1993. These consultative papers, which deal with supervisory treatment of netting arrangements, market risk, and interest rate risk, provide an overview of the work to date of the Basle Committee. While the matters addressed are in their preliminary stages and describe the current status of efforts that are of an ongoing nature, these efforts have potential implications for the evaluation of the capital adequacy of internationally active banks. The Board released an overview, prepared by the Basle Committee, that summarizes each paper. Copies of the committee's papers can be obtained from Publications Services, Board of Governors of the Federal Reserve System, Washington, DC 20551. Comments should be sent to William Wiles, Secretary, at the same address. Any concrete proposals for modifying the U.S. risk-based capital guidelines that eventually grow out of these preliminary consultative papers would be issued for comment before they are adopted for U.S. banking organizations. ISSUANCE OF FINAL RULE AMENDING RISK-BASED CAPITAL GUIDELINES FOR STATE MEMBER BANKS AND BANK HOLDING COMPANIES The Federal Reserve Board issued on April 20, 1993, a final rule amending the risk-based capital guidelines for state member banks and bank hold ing companies to lower from 100 percent to 50 percent the risk weight on loans to finance the construction of one- to four-family residences that have been presold. The final rule amends the Board's Regulation H (Membership of State Banking Institutions in the Federal Reserve System) and Regulation Y (Bank Holding Companies and Change in Bank Control). It is effective April 26, 1993, and implements section 618(a) of the Resolution Trust Corporation Refinancing, Restructuring, and Improvement Act of 1991 (RTCRRIA). REVISIONS TO THE STAFF COMMENTARY TO REGULATION Z The Federal Reserve Board published on April 1, 1993, revisions to its staff commentary to Regulation Z (Truth in Lending). The rules are effective immediately, but compliance is optional until October 1, 1993. The revisions address the interplay between the Truth in Lending rules on demand features and other federal rules dealing with credit extended to executive officers of depository institutions and provide more flexibility in complying with disclosure requirements. The revisions also offer creditors alternative methods of disclosing security interests in rescindable transactions. REVISIONS TO THE LIST OF MARGINABLE OTC STOCKS AND TO THE LIST OF FOREIGN MARGIN STOCKS The Federal Reserve Board published on April 23, 1993, a revised List of Marginable OTC Stocks that are subject to its margin regulations. Also published was the List of Foreign Margin Stocks for foreign equity securities that are subject to Regulation T (Credit by Brokers and Dealers). The 615 lists are effective May 10, 1993, and supersede the previous lists that were effective February 8, 1993. The Foreign List specifies those foreign equity securities that are eligible for margin treatment at broker-dealers. There are no additions, deletions, or changes to the Foreign List, which contains 302 foreign equity securities. The changes that have been made to the OTC List, which now contains 3,259 stocks, are as follows: • One hundred sixty-nine stocks have been included for the first time, 139 under National Market System (NMS) designation. • Thirty-two stocks previously on the list have been removed for substantially failing to meet the requirements for continued listing. • Thirty-eight stocks have been removed for reasons such as listing on a national securities exchange or involvement in an acquisition. The OTC List is published by the Board for the information of lenders and the general public. It includes all over-the-counter securities designated by the Board pursuant to its established criteria as well as all OTC stocks designated as NMS securi- ties for which transaction reports are required to be made pursuant to an effective transaction reporting plan. Additional OTC securities may be designated as NMS securities in the interim between the Board's quarterly publications and will be immediately marginable. The next publication of the Board's list is scheduled for August 1993. Besides NMS-designated securities, the Board will continue to monitor the market activity of other OTC stocks to determine which stocks meet the requirements for inclusion and continued inclusion on the OTC List. RELEASE OF QUARTERLY TABLE OF FACTORS FOR SECTION 20 COMPANIES The Federal Reserve Board released on April 12, 1993, its quarterly table of factors to adjust interest income to be used by section 20 companies that adopt the Board's alternative index revenue test to measure compliance with the 10 percent limit on bank-ineligible securities activities. The table of factors is available from Publications Services, Board of Governors of the Federal Reserve System, Washington, DC 20551. • 617 Legal Developments FINAL RULE—AMENDMENTS G, T, U AND X TO REGULATIONS The Board of Governors is amending 12 C.F.R. Parts 207, 220, 221 and 224, its Regulations G, T, U and X (Securities Credit Transactions; List of Marginable OTC Stocks; List of Foreign Margin Stocks). The List of Marginable OTC Stocks (OTC List) is composed of stocks traded over-the-counter (OTC) in the United States that have been determined by the Board of Governors of the Federal Reserve System to be subject to the margin requirements under certain Federal Reserve regulations. The List of Foreign Margin Stocks (Foreign List) is composed of foreign equity securities that have met the Board's eligibility criteria under Regulation T. The OTC List and the Foreign List are published four times a year by the Board. This document sets forth additions to or deletions from the previous Foreign List. Both Lists were last published on February 1, 1993, and effective on February 10, 1993. Cortech, Inc.: Rights (expire 05-24-94) Crest Industries, Inc.: $.01 par common Everex Systems, Inc.: $.001 par common First Federal Savings Bank (Puerto Rico): $1.00 par common First Seismic Corporation: $.01 par common Green Isle Environmental Services, Inc.: $.18-3/4 par common Hunter Environmental Services Inc.: $.10 par common Imagine Films Entertainment, Inc.: Warrants (expire 07-30-93) Jefferson National Bank (New York): $1.00 par common Main Street & Main Inc.: Warrants (expire 09-04-96) Millfeld Trading Co., Inc.: Class A; Warrants (expire 09-04-96) Effective May 10, 1993, accordingly, pursuant to the authority of sections 7 and 23 of the Securities Exchange Act of 1934, as amended (15 U.S.C.78g and 78w), and in accordance with 12 C.F.R. 207.2(k) and 207.6 (Regulation G), 12 C.F.R. 220.2(u) and 220.17 (Regulation T), and 12 C.F.R. 221.2(j) and 221.7 (Regulation U), there is set forth below a listing of deletions from and additions to the OTC List. NDE Environmental Corporation: $.001 par common NESB Corporation: $.01 par common Deletions from the List of Marginable OTC Stocks Pacific International Services Corp.: N o par common Pentair Inc.: $1.50 par cumulative convertible preferred Stocks Removed for Failing Continued Listing Requirements Alpha 1 Biomedicals, Inc.: Class B, warrants (expire 06-30-95) American Steel and Wire Corporation: $.20 par common ARIX Corporation: $.01 par common B.M.J. Financial Corporation: Rights (expire 03-15-93) Calendar Capital, Inc.: $.01 par common Cherokee Inc.: $.01 par common Circle Fine Art Corporation: $.10 par common Old Stone Corporation: $1.00 par common; Series B, 12% preferred Ramtron Holdings Limited: American Depositary Receipts Receptech Corporation: $.01 par common Sage Analytics International Inc.: $.001 par common Southern Educators Life Insurance Co.: $.50 par common Tele-Communications Inc.: Series A; $1.00 par 12-%% cumulative compounding redeemable preferred USBancorp Inc.: Series A; $2,125 par convertible preferred Washington Mutual Savings Bank: $1.00 par preferred stock 618 Federal Reserve Bulletin • June 1993 Stocks Removed for Listing on a National Securities Exchange or Being Involved in an Acquisition Security Financial Holding Co.: $.01 par common South Carolina Federal Corp. $1.00 par common United American Healthcare Corp.: N o par common Advo, Inc.: $.01 par common Alden Press Company: $.01 par common Allmerica Property & Casualty Companies, Inc.: $1.00 par capital Applied Biosystems Inc.: N o par common Armstrong Pharmaceuticals, Inc.: $.08 par common Clinical Homecare Ltd.: $.01 par common Colonial Companies, Inc.: Class B, non-voting; $1.00 par common DFSoutheastern, Inc.: $1.00 par common Diversco, Inc.: $.01 par common Dominion Bankshares Corporation: $5.00 par common Elm Financial Services, Inc.: $.01 par common Fedfirst Bancshares, Inc.: $.01 par common First Chattanooga Financial Corp.: $1.00 par common First Federal Savings & Loan Association of Fort Meyers: $.01 par common First Federal Savings Bank (Utah): $1.00 par comon Flagler Bank Corporation: Class A; $.10 par common Fremont General Corporation: $1.00 par common Genesis Health Ventures: $.02 par common Glamis Gold Ltd.: N o par common Harmonia Bancorp Inc.: $.01 par common Health Images, Inc.: $.01 par common Heekin Can, Inc.: $.01 par common Imagine Films Entertainment, Inc.: $.01 par common Inforum, Inc.: $.01 par common Integra Financial Corporation: $5.00 par common KCS Energy, Inc.: $.01 par common Lincoln Financial Corporation: N o par common, $10.00 stated value Mercantile Bancorporation, Inc.: $5.00 par common Montclair Bancorp, Inc.: $.01 par common National Savings Bank of Albany: $1.00 par common N e w York Bancorp, Inc.: $.01 par common Piccadilly Cafeterias, Inc.: N o par common Pioneer Savings Bank (Washington): $1.00 par common Puget Sound Bancorp: $5.00 par common Valley National Corporation: $2.50 par common Additions to the List of Marginable OTC Stocks Airsensors, Inc.: $.001 par common; Warrants (expire 03-10-96) Alamo Group, Inc.: $.10 par common Alltrista Corporation: N o par common Amcor Limited: American Depositary Receipts American Federal Bank, FSB (South Carolina): $1.00 par common Amtrol Inc.: $.01 par common Applied Signal Technology, Inc.: N o par common Argosy Gaming Company: $.01 par common Arkansas Best Corporation: Series A; $.01 par cumulative convertible exchangeable preferred Aseco Corporation: $.01 par common Autoimmune Inc.: $.01 par common Avecor Cardiovascular Inc.: $.01 par common Avid Technology, Inc.: $.01 par common Bancfirst Corporation (Oklahoma): $1.00 par common Bancinsurance Corporation: N o par common BHC Financial, Inc.: $.001 par common Biosurface Technology, Inc.: $.01 par common BKC Semiconductor Incorporated: No par common Boca Research, Inc.: $.01 par common Brock Candy Company: Class A; $.01 par common Brookstone, Inc.: $.001 par common Bruno's, Inc.: Convertible debentures (due 09-01-2009) Campo Electronics Appliances & Computers Inc.: $.10 par common Cannon Express, Inc. Class B, non-voting, $.01 par common Cascade Savings Bank, FSB (Washington): $1.00 par common Casino America, Inc.: $.01 par common Casino Data Systems: N o par common Catalytica, Inc.: $.001 par common CB Bancshares, Inc. (Hawaii): $1.00 par common Cell Genesys, Inc.: $.001 par common Champion Industries, Inc.: $1.00 par common Chesapeake Energy Corporation: $.01 par common Chico's Fax, Inc.: $.01 par common Cocensys, Inc.: $.001 par common Commerce Bank (Virginia): $.01 par common Legal Developments Community Bancorp, Inc. (New York): 7.25% Series B; cumulative convertible preferred Community Health Computing Corporation: $.001 par common Computer Outsourcing Services, Inc.: $.01 par common Comverse Technology, Inc.: $.01 par common Coral Gables Fedcorp, Inc.: $.01 par common Cree Research, Inc.: $.01 par common Cryolife, Inc.: $.01 par common Cyberonics, Inc.: $.01 par common Davidson & Associates, Inc.: $10.00 par common DF&R Restaurants, Inc.: $.01 par common Education Alternatives, Inc.: $.01 par common Energy Biosystems Corporation: $.01 par common Envirotest Systems, Inc.: Class A; $.01 par common Equicredit Corporation: $.01 par common Ethical Holdings Limited: American Depositary Receipts Excel Technology, Inc.: Series 1; $.001 par redeemable convertible preferred; Warrants (expire 09-30-97) Fastcomm Communications Corporation: $.01 par common Fed One Savings Bank, F.S.B. (West Virginia): $.10 par common Financial Institutions Insurance Group, Ltd.: $1.00 par common First Family Bank, FSB (Florida): $1.00 par common First Federal Savings Bank of Brunswick, Georgia: $1.00 par common First Shenango Bancorp, Inc. (Pennsylvania): $.10 par common First Southern Bancorp, Inc. (North Carolina): N o par common Fossil, Inc.: $.01 par common Framingham Savings Bank (Massachusetts): Warrants (expire 01-31-96) Funco, Inc.: $.01 par common General Nutrition Companies, Inc.: $.01 par common Gilat Satellite Networks Ltd.: Ordinary shares (NIS .01) Global Industries, Ltd.: $.01 par common Global Spill Management, Inc.: $.001 par common Gupta Corporation: $.01 par common Gymboree Corporation, The: $.001 par common Hahn Automotive Warehouse, Inc.: $.01 par common Hamilton Bancorp, Inc. (New York): $.01 par common Hollywood Park, Inc.: Depositary shares 619 IEC Electronics Corp.: $.01 par common Inco Homes Corporation: $.01 par common Incomnet Inc.: N o par common Independence Federal Savings Bank (Washington, D.C.): $.01 par common Independent Entertainment Group, Inc.: $.0001 par common Intel Corporation: Warrants (expire 03-07-98) Intelligent Surgical Lasers, Inc.: N o par common Intervisual Books, Inc.: N o par common Intuit Inc.: $.01 par common Jackpot Enterprises, Inc.: Warrants (expire 01-31-96) Jackson County Federal Bank, A Federal Savings Bank (Oregon): Series A; $5.00 non-cumulative convertible preferred Jefferson Savings Bancorp, Inc. (Missouri): $.01 par common JMAR Industries, Inc.: $.01 par common; Warrants (expire 02-17-98) Kenfil Inc.: $.01 par common Kinder-Care Learning Centers, Inc.: $.01 par common; Warrants (expire 04-01-97) L.S.B. Bancshares, Inc. of South Carolina: $2.50 par common Landstar System, Inc.: $.01 par common Leasing Solutions, Inc.: N o par common Liberty Technologies, Inc.: $.01 par common Lomak Petroleum, Inc.: $.01 par common Lukens Medical Corporation: $.01 par common Magal Security Systems, Ltd.: Ordinary shares Marcum Natural Gas Services, Inc.: $.01 par common Marion Capital Holdings, Inc.: N o par common Mason-Dixon Bancshares, Inc.: $10.00 par common Mathsoft, Inc.: $.01 par common McGaw, Inc.: $.001 par common Medical Resources, Inc.: $.01 par common Microchip Technology, Inc.: $.001 par common Molecular Dynamics, Inc.: $.01 par common Molten Metal Technology, Inc.: $.01 par common Mothers Work, Inc.: $.01 par common Nathan's Famous, Inc.: $.01 par common National Convenience Stores Incorporated: $.01 par common NFO Research, Inc.: $.01 par common Norand Corporation: $.01 par common Northrim Bank (Alaska): $1.00 par common NSA International, Inc.: $.05 par common Nubco, Inc.: N o par common 620 Federal Reserve Bulletin • June 1993 Orchard Supply Hardware Stores Corporation: $.01 par common Orthologic Corporation: $.005 par common Pacific Sunwear of California, Inc.: $.01 par common Parallan Computer, Inc.: N o par common Patrick Petroleum Company: Series B; $1.00 par convertible preferred Penn Central Bancorp, Inc. (Pennsylvania): $1.25 par common Pennsylvania Gas and Water: Depositary preferred shares Peoples Bancorp, Inc. (Ohio): $1.00 par common Perceptron, Inc.: $.01 par common Petersburg Long Distance Inc.: N o par common Philip Environmental Inc.: N o par common Physician Corporation of America: $.01 par common Physicians Health Services, Inc.: Class A, $.01 par common Pikeville National Corporation: $5.00 par common PMR Corporation: $.01 par common Powersoft Corporation: $.00167 par common Preferred Health Care Ltd.: $.01 par common Proxima Corporation: $.001 par common Quantum Corporation: 6-Vs% convertible nated debentures due 2002 subordi- Recovery Engineering, Inc.: $.01 par common Regent Bancshares Corp. (Pennsylvania): Series A, $. 10 par convertible preferred Resound Corporation: $.01 par common Rocky Shoes & Boots, Inc.: N o par common Roosevelt Financial Group, Inc.: 6-l/2% non-cumulative convertible preferred Rouse Company, The: Series A, convertible preferred stock RPM, Inc.: Liquid yield option notes due 2012 S3 Incorporated: $.001 par common Sage Alerting Systems, Inc.: $.01 par common Savoy Pictures Entertainment, Inc.: $.01 par common Shaman Pharmaceuticals, Inc.: $.01 par common Shared Technologies, Inc.: $.001 par common Shoe Carnival, Inc.: $.01 par common Southern Energy Homes, Inc.: $.0001 par common Specialty Paperboard, Inc.: $.001 par common Standard Management Corporation: N o par common Staples, Inc.: 5% convertible subordinated debentures Stephan Company, The: $.01 par common Sumitomo Bank of California, The: Depositary shares Sun Bancorp, Inc. (Pennsylvania): $2.50 par common Sunrise Bancorp, Inc. ( N e w York): $.10 par common Superconductor Technologies, Inc.: $10.00 par common Suprema Specialties, Inc.: $.01 par common Tecnomatix Technologies, Ltd.: Ordinary shares (NIS .01 par value) Tencor Instruments: N o par common Tide West Oil Company: $.01 par common Tricord Systems, Inc.: $.01 par common U.S. Can Corporation: $.01 par common Union Bankshares, Ltd. (Colorado): $.001 par common Universal Electronics, Inc.: $.01 par common Vical Incorporated: $.01 par common Virginia First Savings Bank, F.S.B.: $1.00 par common Wall Data Incorporated: N o par common Washington Homes, Inc.: $.01 par common Watson Pharmaceuticals, Inc.: $.0033 par common WCT Communications, Inc.: N o par common Wordstar International Corporation: Warrants (expire 03-26-96) FINAL RULE—AMENDMENT HAND Y TO REGULATIONS The Board of Governors is amending 12 C.F.R. Parts 208 and 225, its Regulations H and Y (Capital and Capital Adequacy Guidelines). The Board is amending the risk-based capital guidelines for bank holding companies and state member banks to lower from 100 percent to 50 percent the risk weight assigned to certain loans to builders to finance the construction of presold residential (one- to four-family) properties. This final rule implements section 618(a) of the Resolution Trust Corporation Refinancing, Restructuring, and Improvement Act of 1991. Effective April 26, 1993, 12 C.F.R. Parts 208 and 225 are amended as follows: Part 208—Membership of State Banking Institutions in the Federal Reserve System 1. The authority citation for part 208 is revised to read as follows: Authority: Sections 9,11(a), 11(c), 19, 21, 25, and 25(a) of the Federal Reserve Act, as amended (12 U . S . C . 321-338, 248(a), 248(c), 461, 481-486, 601, and 611, respectively); sections 4 and 13(j) of the Federal Deposit Insurance Act, as amended (12 U.S.C. 1814 and 1823(j), respectively); sections 7(a) of the International Banking Act of 1978 (12 U . S . C . 3105); sections 907- Legal Developments 910 of the International Lending Supervision Act of 1983 (12 U.S.C. 3906-3909); sections 2, 12(b), 12(g), 12(i), 15B(c)(5), 17, 17A, and 23 of the Securities Exchange Act of 1934 (15 U.S.C.78b, 78/(b), 78/(g), 78/(i), 78o-4(c)(5), 78q, 78q-l, and 78w, respectively); section 5155 of the Revised Statutes (12 U.S.C. 36) as amended by the McFadden Act of 1927; and sections 1101-1122 of the Financial Institutions Reform, Recover and Enforcement Act of 1989 (12 U.S.C. 3310 and 3331-3351); 12 U.S.C. 93a, 161, 1818, 3907, 3909, Sec. 618, Pub. L. 102-233, 105 Stat. 1761 (Resolution Trust Corporation Refinancing, Restructuring, and Improvement Act of 1991). APPENDIX A TO PART 621 225—[AMENDED] III. Procedures for Computing Weighted-Risk Assets and Off-Balance-Sheet Items C. Risk Weights ^ * * *38 2. Appendix A to part 208 is amended by revising footnote 35 to read as follows: FINAL RULE—AMENDMENT APPENDIX A TO PART 208—[AMENDED] III. Procedures for Computing Weighted-Risk Assets and Off-Balance-Sheet Items C. Risk Weights % 3 i(i s|e * * *35 Part 225—Bank Holding Companies and Change in Bank Control 1. The authority citation for part 225 is revised to read as follows: Authority: 12 U.S.C. 1817(j)(13), 1818, 1831i, 1843(c)(8), 1844(b), 3106, 3108, 3907, 3909, 3310, and 3311-3351. 2. Appendix A to part 225 is amended by revising footnote 38 to read as follows: 35. Loans that qualify as loans secured by one- to four-family residential properties are listed in the instructions to the commercial bank call report. In addition, for risk-based capital purposes, loans secured by one- to four-family residential properties include loans to builders with substantial project equity for the construction of one- to four-family residences that have been presold under firm contracts to purchasers who have obtained firm commitments for permanent qualifying mortgage loans and have made substantial earnest money deposits. TO REGULATION O The Board of Governors is amending 12 C.F.R. Part 215, its Regulation O (Loans to Executive Officers, Directors, and Principal Shareholders of Member Banks; Loans to Holding Companies and Affiliates), to implement recent amendments to section 22(h) of the Federal Reserve Act, contained in the Housing and Community Development Act of 1992. The final rule adopts three exceptions to the aggregate insider lending limit in Regulation O substantially as they were set forth in the Board's proposed rule. Additional exceptions suggested by commenters will be considered in future rulemaking. Effective May 3, 1993, 12 C.F.R. Part 215 is amended as follows: Part 215—Loans to Executive Officers, Directors, and Principal Shareholders of Member Banks 1. The authority citation for part 215 is revised to read as follows: Authority. 12 U.S.C. 248(i), 375a, 375b(7), 1817 (k)(3) and 1972(2)(F)(vi), Pub. L. 102-550, 106 Stat. 3895 (1992). 38. Loans that qualify as loans secured by one- to four-family residential properties are listed in the instructions to the FR Y-9C Report. In addition, for risk-based capital purchases, loans secured by one- to four-family residential properties include loans to builders with substantial project equity for the construction of one- to four-family residences that have been presold under firm contracts to purchasers who have obtained firm commitments for permanent qualifying mortgage loans and have made substantial earnest money deposits. 622 Federal Reserve Bulletin • June 1993 Subpart A—Loans by Member Banks to Their Executive Officers, Directors, and Principal Shareholders Part 265—Rules Regarding Delegation of Authority 1. The authority citation for part 265 is revised to read as follows: 2. Section 215.4 is amended by adding a new paragraph (d)(3) to read as follows: Authority: 12 U.S.C. 248(i) and (k). S e c t i o n 215.4—General prohibitions. 2. Section 265.5 is amended by adding paragraph (c)(3) to read as follows: ^ *** (3) Exceptions. The general limit specified in paragraph (d)(1) of this section does not apply to the following: (i) Extensions of credit secured by a perfected security interest in bonds, notes, certificates of indebtedness, or Treasury bills of the United States or in other such obligations fully guaranteed as to principal and interest by the United States; (ii) Extensions of credit to or secured by unconditional takeout commitments or guarantees of any department, agency, bureau, board, commission or establishment of the United States or any corporation wholly owned directly or indirectly by the United States; or (iii) Extensions of credit secured by a perfected security interest in a segregated deposit account in the lending bank. (iv) The exceptions in this paragraph (d)(3) apply only to the amount of such extensions of credit that are secured in the manner described herein. FINAL RULE—AMENDMENT TO RULES REGARDING DELEGATION OF AUTHORITY Section 2 6 5 . 5 — F u n c t i o n s delegated to Secretary of the Board. (c) ^ (3) Application approval under section 5(d)(3) of the FDI Act. To approve applications pursuant to section 5(d)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1815(d)(3)), in those cases in which the appropriate Federal Reserve Bank concludes that, because of unusual considerations, or for other good cause, it should not take action. 3. In section 265.6, paragraph (c)(5) is removed. ORDERS ISSUED UNDER BANK COMPANY ACT HOLDING Orders Issued Under Section 3 of the Bank Holding Company Act First Fidelity Bancorporation Lawrenceville, N e w Jersey B a n c o Santander, S . A . Madrid, Spain Order Approving the Acquisition of a Bank The Board of Governors is amending 12 C.F.R. Part 265, its Rules Regarding Delegation of Authority, in order to delegate to the Secretary of the Board, and to repeal with respect to the General Counsel of the Board acting with the concurrence of the Director of the Division of Banking Supervision and Regulation, the authority to approve certain transactions requiring the approval of the Board pursuant to section 5(d)(3) of the Federal Deposit Insurance Act (FDI Act). This amendment will align the Board's procedures for approving "Oakar" transactions with those procedures used to approve other types of applications involving a director interlock with a Federal Reserve Bank. Effective May 3, 1993, 12 C.F.R. Part 265 is amended as follows: First Fidelity Bancorporation, Lawrenceville, New Jersey ("First Fidelity"), a bank holding company within the meaning of the Bank Holding Company Act ("BHC Act"), has applied under section 3 of the BHC Act (12 U.S.C. § 1842) to acquire Northeast Bancorp, Inc., New Haven, Connecticut ("Northeast"), and thereby indirectly acquire Union Trust Company, Stamford, Connecticut ("Union Trust"), a state nonmember bank. 1 Banco Santander, S.A., Madrid, Spain 1. The proposal is structured as a merger of First Fidelity's wholly owned subsidiary, FFB Newco, Inc. ("Newco"), with and into Northeast pursuant to alternative plans of merger. The first plan, which would be implemented if the merger is approved by both classes Legal Developments ("Santander"), which controls First Fidelity within the meaning of the BHC Act, 2 also has applied under section 3 of the BHC Act to acquire Northeast and Union Trust. Notice of the applications, affording interested persons an opportunity to submit comments, has been published (58 Federal Register 4171, 12,038 (1993)). The time for filing comments has expired, and the Board has considered the applications and all comments received in light of the factors set forth in section 3(c) of the BHC Act. First Fidelity, with total consolidated assets of approximately $31.5 billion, is the largest commercial banking organization in New Jersey, controlling 22.2 percent of commercial bank deposits in the state. 3 First Fidelity operates six subsidiary banks in New Jersey, Pennsylvania, and New York, 4 and engages through its subsidiaries in a broad range of banking and permissible nonbanking activities. Santander, with total consolidated assets of approximately $60.3 billion, is the fifth largest banking organization in Spain and the 95th largest banking organization in the of Northeast's common stock, provides that all shares of Northeast would be converted into shares of First Fidelity common stock, and that the shares of Newco would be converted into shares of Northeast as the surviving corporation. The second plan of merger would be implemented if the transaction is approved by the holders of Northeast's voting common stock but not by the holders of its nonvoting common stock. Under the second plan, Northeast's nonvoting common stock would remain outstanding, Northeast's voting common stock would be converted into shares of First Fidelity common stock, and the shares of Newco would be converted into shares of Northeast stock. Newco has no assets or operations, and was formed for the purpose of consummating this transaction. First Fidelity also seeks the Board's approval to acquire up to 24.9 percent of Northeast's voting common stock pursuant to the exercise of a conditional stock option granted by Northeast to First Fidelity. The option is exercisable if Northeast receives an acquisition proposal from a third party, and in certain other circumstances. 2. Santander currently holds approximately 16 percent of the outstanding voting shares of First Fidelity, and would hold approximately 19 percent of First Fidelity's voting shares upon consummation of this proposal. After consummation, Santander's ownership interest in First Fidelity could increase to approximately 24 percent upon exercise of all First Fidelity warrants held by Santander. Moreover, Santander representatives serve on the board of directors of First Fidelity, and Santander has proposed to provide certain management assistance to First Fidelity. See Banco de Santander, S.A. de Credito, 78 Federal Reserve Bulletin 72 (1992). 3. Asset data for First Fidelity and Northeast are as of December 31, 1992; state deposit and ranking data are as of September 30, 1992. First Fidelity also is the sixth largest commercial banking organization in Pennsylvania, controlling 6 percent of commercial bank deposits in the state, and the 45th largest commercial banking organization in New York, controlling less than 1 percent of commercial bank deposits in the state. 4. First Fidelity is in the process of merging all of its New Jersey banking operations into First Fidelity Bank, N.A., New Jersey, Newark, New Jersey, and all of its Pennsylvania banking operations into Fidelity Bank, N.A., Philadelphia, Pennsylvania. First Fidelity's sole New York bank subsidiary is First Fidelity Bank, N.A., New York, Bronx, New York. 623 world. 5 In the United States, Santander operates a branch in New York, New York, and an agency and an Edge corporation in Miami, Florida. 6 Northeast, with total consolidated assets of approximately $2.7 billion, is the third largest commercial banking organization in Connecticut, controlling 9.9 percent of commercial bank deposits in the state. Douglas Amendment Analysis Section 3(d) of the BHC Act, the Douglas Amendment, prohibits the Board from approving an application by a bank holding company to acquire, directly or indirectly, any voting shares of, or interest in, any bank located outside the state in which the operations of the bank holding company's bank subsidiaries are principally conducted ("home state"), unless the acquisition "is specifically authorized by the statute laws of the State in which such bank is located, by language to that effect and not merely by implication." 7 For purposes of the Douglas Amendment, First Fidelity's home state is New Jersey. 8 In order to approve these applications, the Board must determine that, under Connecticut law, a Connecticut bank and bank holding company may be acquired by an out-of-state bank holding company. The statute laws of Connecticut expressly authorize the acquisition of a bank located in Connecticut by an out-of-state domestic bank holding company, if the second state authorizes the acquisition of a bank in that state by a Connecticut bank holding company on a reciprocal basis. 9 The interstate banking laws of New Jersey expressly authorize the acquisition of a bank on a reciprocal basis by a Connecticut bank 5. Asset and ranking data for Santander are as of December 31, 1991, and employ exchange rates then in effect. 6. Santander also controls Banco de Santander-Puerto Rico, S.A., Hato Rey, Puerto Rico, and Santander National Bank, Bayamon, Puerto Rico, and owns a minority, noncontrolling interest in The Royal Bank of Scotland Group pic, Edinburgh, Scotland, a bank holding company within the meaning of the BHC Act. See Banco de Santander, S.A. de Credito, 78 Federal Reserve Bulletin 60 (1992). 7. 12 U.S.C. § 1842(d). 8. A bank holding company's home state is that state in which the operations of the bank holding company's banking subsidiaries were principally conducted on July 1, 1966, or the date on which the company became a bank holding company, whichever is later. 9. Under Connecticut's interstate banking statute, any out-of-state bank holding company may, with the approval of the Connecticut banking commissioner, acquire ownership or control of all or part of the voting stock of a Connecticut bank or bank holding company if the laws of the state in which the operations of the acquiring bank holding company's bank subsidiaries are principally conducted expressly authorize, under conditions no more restrictive than those imposed under Connecticut law, the acquisition by a Connecticut bank holding company of a bank or bank holding company having its principal place of business in that other state. Conn. Gen. Stat. Ann. § 36-553 (West Supp. 1992). 624 Federal Reserve Bulletin • June 1993 holding company. 10 The Banking Commissioner for the State of N e w Jersey has determined that Connecticut has reciprocal legislation in effect for purposes of N e w Jersey's interstate banking statute, and has advised First Fidelity that the New Jersey Department of Banking has no objection to the proposal. In applying the Douglas Amendment to Santander, the Board has considered, in addition to the New Jersey statute, the interstate banking laws of Rhode Island and New York, 11 which also provide for interstate banking on a reciprocal basis, and which contain provisions comparable to Connecticut's interstate banking law. 12 After careful review of the relevant statutes, and in light of all the facts of record, the Board has concluded that the proposed acquisition of Northeast is specifically authorized by Connecticut's interstate banking statute, and that the Board's approval of this proposal is therefore not prohibited by the Douglas Amendment. Approval of the proposed transaction is conditioned, however, upon the receipt by First Fidelity and Santander of all required state regulatory approvals. 10. Under New Jersey law, an out-of-state bank holding company may acquire control of a bank located in New Jersey if the acquiring bank holding company is located in a reciprocal state (i.e., a state which allows New Jersey bank holding companies to acquire banks or bank holding companies located in that state on terms and conditions substantially the same as those applicable to such an acquisition by banks and bank holding companies located in that state), and more than 50 percent of the total aggregate deposits controlled by the acquiring bank holding company's bank subsidiaries are held by bank subsidiaries located in reciprocal states. N.J. Stat. Ann. § 17:9A-371 (West Supp. 1992). 11. Santander is subject to the Douglas Amendment directly because it is a bank holding company within the meaning of the BHC Act, and indirectly because it is a foreign bank subject to the International Banking Act (12 U.S.C. § 3101 et seq.) ("IBA"). 12. Under Rhode Island law, an out-of-state bank or bank holding company may acquire ownership or control of the voting stock of a Rhode Island bank or bank holding company if the laws of the state in which the acquiring bank is located, or the laws of the state in which the operations of the acquiring bank holding company's bank subsidiaries are principally conducted, expressly authorize, under conditions no more restrictive than those imposed under Rhode Island law, the acquisition by a Rhode Island bank or bank holding company of a bank located in that other state, or of a bank holding company the operations of whose bank subsidiaries are principally conducted in that other state. R.I. Gen. Laws § 19-30-2 (1989). Under New York law, an out-of-state bank holding company may acquire control of a bank located in New York if the New York Superintendent of Banking determines that the statute laws of the state in which the operations of the out-of-state bank holding company's banking subsidiaries are principally conducted specifically authorize the acquisition of control of a bank in that state by a bank holding company the operations of whose banking subsidiaries are principally conducted in New York, and that the conditions or restrictions applicable to an interstate acquisition would apply with equal effect to an in-state acquisition. N.Y. Banking Law § 142-b (McKinney 1990). In connection with the processing of these applications, the Federal Reserve Bank of New York has been advised by the New York Banking Department that Connecticut's interstate banking law is non-discriminatory and reciprocal with New York's interstate banking law, and that New York law would not prevent a bank holding company, the operations of whose banking subsidiaries are principally conducted in Connecticut, from acquiring control of a bank having its principal office in New York. Supervisory Considerations Under section 3 of the BHC Act, as amended by the Foreign Bank Supervision Enhancement Act of 1991,13 the Board may not approve an application involving a foreign bank unless the bank is "subject to comprehensive supervision or regulation on a consolidated basis by the appropriate authorities in the bank's home country." 14 The Board recently determined, in an application under the International Banking Act (12 U.S.C. § 3101 et seq.) ("IBA"), that another Spanish credit institution, Banco de Sabadell, S.A., Sabadell, Spain ("Banco de Sabadell"), was subject to comprehensive consolidated supervision by its home country authorities. 15 Santander has represented to the Board that it is subject to the same regulatory scheme applicable to Banco de Sabadell, and has furnished additional information regarding the authorities' ability to supervise and regulate the activities of Santander on a worldwide, consolidated basis. The Board has reviewed this information, as well as the information previously received as it may apply to Santander. Based on all the facts of record, which include the information described above, the Board has concluded that Santander is subject to comprehensive supervision and regulation on a consolidated basis by its home country supervisor. In addition, Santander has committed that, to the extent not prohibited by applicable law, it will make available to the Board such information on the operations of Santander and any of its affiliates that the Board deems necessary to determine and enforce compliance with the BHC Act, the IBA, and other applicable federal law. Santander also has committed to cooperate with the Board to obtain any waivers or exemptions that may be necessary in order to enable Santander to make any such information available to the Board. In light of these commitments and other facts of record, 16 the Board has concluded that 13. Pub. L. No. 102-242, § 201 et seq. 105 Stat. 2286 (1991). 14. 12 U.S.C. § 1842(c)(3)(B). As provided in Regulation Y, the Board determines whether a foreign bank is subject to consolidated home country supervision under the standards set forth in Regulation K. 12 C.F.R. 225.13(b)(4). Regulation K provides that a foreign bank may be considered subject to consolidated supervision if the Board determines that the bank is supervised or regulated in such a manner that its home country supervisor receives sufficient information on the worldwide operations of the foreign bank, including the relationship of the bank to its affiliates, to assess the foreign bank's overall financial condition and compliance with law and regulation. 12 C.F.R. 211.24(c)(1)(h). 15. See Banco de Sabadell, S.A., 79 Federal Reserve Bulletin 366 (1993). 16. In this regard, the Board notes that it previously has reviewed relevant provisions of Spanish confidentiality, secrecy, and other laws. See Banco de Sabadell, S.A.,19 Federal Reserve Bulletin 366 (1993). Legal Developments Santander has provided adequate assurances of access to any appropriate information the Board may request. Competitive, Banking, and Convenience Considerations and Needs Santander and Northeast compete directly in the Metropolitan New York-New Jersey banking market. 17 Upon consummation of this proposal, Santander would remain the fifth largest commercial banking or thrift organization in the market, controlling less than 5.5 percent of the total deposits in depository institutions in the market. 18 After considering the number of competitors remaining in this market, the relatively small increase in concentration as measured by the Herfindahl-Hirschman Index ("HHI"), 1 9 and other facts of record, the Board has concluded that consummation of this proposal would not have a significantly adverse effect on competition in the Metropolitan New York-New Jersey banking market or any other relevant banking market. Considerations relating to the financial and managerial resources and future prospects of First Fidelity, Santander, Northeast, and their respective subsidiaries, as well as convenience and needs considerations and other supervisory factors the Board is required to consider under section 3 of the BHC Act, also are consistent with approval of these applications. 20 17. The Metropolitan New York-New Jersey banking market is approximated by New York City; Nassau, Orange, Putnam, Rockland, Suffolk, Sullivan, and Westchester Counties in New York; Bergen, Essex, Hudson, Hunterdon, Middlesex, Monmouth, Morris, Ocean, Passaic, Somerset, Sussex, Union, and Warren Counties in New Jersey; and portions of Fairfield County in Connecticut. Under the revised Department of Justice Merger Guidelines, 49 Federal Register 26,823 (1984), this market is considered unconcentrated. 18. For purposes of this analysis, deposits held by bank subsidiaries of First Fidelity are considered to be controlled by Santander. The Board previously has indicated that thrift institutions have become, or have the potential to become, major competitors of commercial banks. See Midwest Financial Group, 15 Federal Reserve Bulletin 386 (1989); National City Corporation, 70 Federal Reserve Bulletin 743 (1984). Thus, for purposes of this analysis, deposits of thrift institutions are included at 50 percent. 19. Upon consummation of this proposal, the HHI in the Metropolitan New York-New Jersey banking market would increase by 5 points to 560. 20. The Board notes that Santander's capital is in excess of the minimum levels that would be required by the Basle Accord, and is considered equivalent to the capital that would be required of a United States bank holding company. The Board also has considered the records of performance under the Community Reinvestment Act (12 U.S.C. § 2901 et seq.) ("CRA") of the United States banks, branches, and agencies controlled by Santander. Although the Board has identified certain weaknesses in the CRA record of one of Santander's bank subsidiaries, these deficiencies are being addressed by Santander with the primary Federal regulator for this institution, the Office of the Comptroller of the Currency, and, in light of all the facts of record, do not reflect so adversely upon the convenience and needs considerations as to warrant denial of these applications. 625 Based on the foregoing and other facts of record, the Board has determined that the applications should be, and hereby are, approved. The Board's approval is specifically conditioned upon compliance with all of the commitments made by First Fidelity and Santander in connection with these applications and with the conditions referred to in this Order. For purposes of this action, the commitments and conditions relied on in reaching this decision shall be deemed to be conditions imposed in writing by the Board and, as such, may be enforced in proceedings under applicable law. The transactions approved in this Order shall not be consummated before the thirtieth calendar day following the effective date of this Order, or later than three months after the effective date of this Order, unless such period is extended for good cause by the Federal Reserve Bank of Philadelphia or the Federal Reserve Bank of New York, acting pursuant to delegated authority. By order of the Board of Governors, effective April 2, 1993. Voting for this action: Chairman Greenspan and Governors Mullins, Angell, Kelley, LaWare, Lindsey, and Phillips. BARBARA R . LOWREY Associate Secretary of the Board Intervest Bancshares Corporation New York, New York Order Approving Formation of a Bank Company Holding Intervest Bancshares Corporation, New York, New York ("Intervest"), has applied under section 3(a)(1) of the Bank Holding Company Act, 12 U.S.C. § 1842(a)(1) ("BHC Act"), to become a bank holding company by acquiring at least 69.6 percent of the voting shares of Countryside Bankers, Clearwater, Florida ("Bank"). Notice of the application, affording interested persons an opportunity to submit comments, has been published (58 Federal Register 11,056 (1993)). The time for filing comments has expired, and the Board has considered the application and all comments received in light of the factors set forth in section 3(c) of the BHC Act. Intervest is a non-operating company formed for the purpose of acquiring Bank. Bank is the 149th largest commercial banking organization in Florida, controlling deposits of approximately $23.2 million, repre- 626 Federal Reserve Bulletin • June 1993 senting less than 1 percent of total deposits in commercial banks in the state. 1 Intervest and Bank do not compete directly in any banking market. Accordingly, based on all the facts of record in this case, consummation of this proposal would not have a significantly adverse effect on competition or the concentration of banking resources in any relevant banking market. The financial and managerial resources 2 and future prospects of Intervest and Bank, and other supervisory factors that the Board is required to consider under section 3 of the BHC Act are also consistent with approval of this proposal. In this regard, the Board notes that Intervest will provide substantial additional capital to Bank as a result of this proposal. The Board has also considered factors relating to the convenience and needs of the communities to be served. The Board notes that Bank will be under new ownership as a result of this proposal and that Intervest will initiate a number of steps to improve substantially the performance of Bank under the Community Reinvestment Act, 12 U.S.C. § 2901 et seq. ("CRA"). These measures will address specific deficiencies identified in previous examinations of Bank's CRA performance record. 3 In general, the Statement of the Federal Financial Supervisory Agencies Regarding the Community Reinvestment Act indicates that commitments for future corrective actions offered in the applications process will not be sufficient to overcome a seriously deficient CRA record. 4 In this case, however, the inadequate CRA record does not reflect the actions of the proposed new owners, and they have committed to take steps to correct deficiencies in the CRA performance in a timely fashion. Intervest's progress will be monitored by the Federal Reserve Bank of Atlanta and reviewed by the Board in future applications to establish a depository facility. In light of all the facts of record, including the CRA measures to be initiated, the Board believes that considerations relating to the convenience and needs of the community to be served are consistent with approval. The Board expects Intervest to implement corrective measures regarding Bank's CRA performance, and the Board's decision is specifically conditioned upon compliance with the CRA commitments and plans submitted by Intervest. Based on the foregoing and other facts of record, the Board has determined that the application should be, and hereby is, approved. The Board's approval of this transaction is specifically conditioned upon compliance with all of commitments made by Intervest in connection with this application, including commitments and initiatives relating to Bank's CRA performance. For purposes of this action, the commitments and conditions relied upon by the Board in reaching its decision are both commitments imposed in writing by the Board in connection with its findings and decision, and, as such, may be enforced in proceedings under applicable law. The transaction shall not be consummated before the thirtieth calendar day following the effective date of this Order, or later than three months after the effective date of this Order, unless such period is extended for good cause by the Federal Reserve Bank of Atlanta, pursuant to delegated authority. By order of the Board of Governors, effective April 26, 1993. Voting for this action: Chairman Greenspan and Governors Angell, Kelley, LaWare, and Phillips. Absent and not voting: Governors Mullins and Lindsey. JENNIFER J. JOHNSON Associate Secretary of the Board Orders Issued Under Sections 3 and 4 of the Bank Holding Company Act 1. State data are as of June 30, 1992. 2. The Board has carefully reviewed comments from two individuals maintaining that Intervest's principals lack banking experience and familiarity with Bank's community. Intervest has responded that it plans to retain existing management of Bank, which has a substantial knowledge of the local community. In addition, the record indicates that Intervest's principals will be actively involved in ascertaining local credit needs. The Board expects that Bank will at all times be staffed with competent and experienced management, and notes that, for the next two years, Intervest and Bank will be subject to the requirements contained in section 914 of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, which provide that notice must be given to the appropriate federal banking agency prior to the addition or replacement of any senior executive officers of Intervest or Bank. Based on all the facts of record, the Board concludes that these comments do not warrant denial of Intervest's application. 3. These examinations were conducted by the Federal Reserve Bank of Atlanta as of May 1992 and March 1993. 4. See 54 Federal Register 13,742 (1989). Mellon Bank Corporation Pittsburgh, Pennsylvania Order Approving Acquisition of a Bank Holding Company, Formation of a Bank Holding Company, and Application to Engage in Nonbanking Activities Mellon Bank Corporation, Pittsburgh, Pennsylvania ("Mellon"), a bank holding company within the meaning of the Bank Holding Company Act ("BHC Act"), has applied under section 3(a)(3) of the BHC Act (12 U.S.C. § 1842(a)(3)) to acquire Boston Group Holdings, Inc., New York, New York ("BGH"), and thereby to acquire indirectly The Boston Company, Legal Developments Boston, Massachusetts ("TBC"), a subsidiary of BGH, and Boston Safe Deposit & Trust Company, Boston, Massachusetts ("BSD&T"), a subsidiary of TBC.' Mellon also has applied under section 4(c)(8) of the BHC Act and section 225.23 of the Board's Regulation Y (12 C.F.R. 225.23) to acquire The Boston Company Advisors, Inc. ("TBC Advisors"), a subsidiary of BGH and TBC, and to engage through TBC Advisors in providing administrative and certain other services to mutual funds. This is an activity the Board has not previously considered under section 4(c)(8) of the BHC Act. In addition, Mellon has applied under section 4(c)(8) to acquire the other nonbanking subsidiaries of BGH listed in Appendix B to this Order and thereby engage in making and servicing loans; providing trust services; and providing investment advisory services pursuant to sections 225.25(b)(1), (b)(3), and (b)(4) of the Board's Regulation Y (12 C.F.R. 225.25(b)(1), (b)(3), and (b)(4)). Douglas 627 Amendment Section 3(d) of the BHC Act, the Douglas Amendment, prohibits the Board from approving an application by a bank holding company to acquire any bank located outside of the bank holding company's home state, unless such acquisition is "specifically authorized by the statute laws of the State in which such bank is located, by language to that effect and not merely by implication." 3 For purposes of the Douglas Amendment, Mellon's home state is Pennsylvania. The Massachusetts Banking Code expressly authorizes the acquisition of a Massachusetts bank by an out-of-state bank holding company if the laws of the state in which the subsidiary banks of the out-of-state bank holding company principally conduct business allow Massachusetts banking organizations to acquire banks in that state. 4 The statute laws of Pennsylvania expressly authorize the acquisition of a banking institution or bank holding company located in Pennsylvania by a bank holding company located in another state, if that other state authorizes the acquisition of a financial institution on a reciprocal basis by a Pennsylvania bank holding company. 5 Based on all the facts of record, the Board concludes that approval of this proposal is not prohibited by the Douglas Amendment. 6 Mellon also has given notice pursuant to section 4(c)(13) of the BHC Act and section 211.5(c) of the Board's Regulation K (12 C.F.R. 211.5(c)) of its intent to acquire indirect control of Boston Safe Deposit and Trust Company (U.K.) Limited, London, England; Premier Unit Trust Administration Limited, London, England; and The Boston Company Advisors (Bermuda) Ltd., Hamilton, Bermuda. These companies engage in activities that are permissible under section 211.5(d) of Regulation K (12 C.F.R. 211.5(d)). Notice of the applications, affording interested persons an opportunity to submit comments, has been published (57 Federal Register 62,346 (1992)). The time for filing comments has expired, and the Board has considered the applications and all comments received in light of the factors set forth in sections 3(c) and 4 of the BHC Act. Mellon, with total consolidated assets of $31.5 billion, operates subsidiary banks in Pennsylvania, Delaware, and Maryland. 2 BGH has total consolidated assets of $8.7 billion and engages in providing institutional trust and custody services, institutional investment management services, and private banking services. The Board has received comments from organizations supporting approval of these applications based on Mellon's record of performance under the Community 1. BSD&T became a bank for purposes of the BHC Act upon enactment of the Competitive Equality in Banking Act of 1987 ("CEBA"), but its ownership by BGH and TBC was grandfathered under section 101(c) of CEBA. Upon consummation of this transaction, TBC and BGH will become subject to the provisions of the BHC Act, and each has applied under section 3(a)(1) of the BHC Act to become a bank holding company. Mellon would purchase BGH from Shearson Lehman Brothers ("Shearson"), a subsidiary of American Express. As part of this transaction, Shearson will also acquire stock and warrants to acquire stock of Mellon. 2. Asset and state banking data are as of December 31, 1992, and June 30, 1992, respectively. 3. 12 U.S.C. § 1842(d). 4. Mass. Gen. Laws Ann. ch. 167A, § 2. The Massachusetts statute also conditions entry on the requirement that the out-of-state bank holding company not hold more than 15 percent of the total deposits, exclusive of foreign deposits, held by all state and federally chartered banks in the commonwealth and Massachusetts branches of banks existing by authority of a foreign country. Upon consummation of this transaction, Mellon would hold approximately 7.4 percent of the banking deposits in Massachusetts. 5. Pa. Stat. Ann. tit. 7, § 116 (Purdon 1992). 6. Approval of this proposal is conditioned upon Mellon's receiving all required state regulatory approvals. Financial, Managerial, Factors and Other Supervisory The Board also concludes that the financial and managerial resources and future prospects of Mellon and BGH and their respective subsidiaries, and the other supervisory factors that the Board must consider under section 3 of the BHC Act, are consistent with approval. The competitive factors under section 3 are also consistent with approval. Convenience and Needs Factors 628 Federal Reserve Bulletin • June 1993 Reinvestment Act (12 U.S.C. § 2901 et seq.) ("CRA"), and from an individual ("Protestant") criticizing the CRA performance of Mellon and accusing Mellon of discriminating against residents of lowincome areas of North Philadelphia in the provision of banking services, including housing-related loans. The Board has carefully reviewed the CRA performance records of Mellon and TBC and their subsidiary banks, as well as all comments received regarding these applications, including Mellon's response to those comments, and all of the other relevant facts of record in light of the CRA, the Board's regulations, and the Statement of the Federal Financial Supervisory Agencies Regarding the Community Reinvestment Act ("Agency CRA Statement"). 7 The Board notes that all of Mellon's subsidiary banks have been examined for CRA performance and have received "outstanding" or "satisfactory" ratings during their most recent CRA examinations. In particular, Mellon's lead subsidiary bank, Mellon Bank, N.A., Pittsburgh, Pennsylvania ("Mellon Bank"), received a "satisfactory" rating for CRA performance from the Office of the Comptroller of the Currency ("OCC") in July 1991. The Board further notes that this CRA examination of Mellon Bank found no evidence of practices intended to discourage applications for credit and no evidence of the types of illegal discrimination alleged by Protestant. 8 On the basis of all of the facts of record, including information provided by the Protestant, the OCC, and the other commenters supporting Mellon's CRA performance, the Board concludes that the convenience and needs considerations, including the CRA performance records of all bank subsidiaries, are consistent with approval of these applications. Nonbanking Activities Mutual Funds Serving as Administrator to One of the nonbanking companies Mellon will indirectly acquire, TBC Advisors, engages in a variety of activities with mutual funds that have not been previously approved by the Board. TBC Advisors currently provides a number of administrative and advisory services to 84 different open-end investment companies ("mutual funds") and 14 different closed-end 7. 54 Federal Register 13,742 (1989). 8. Protestant also criticizes Mellon's failure to provide a specific loan to Protestant that was intended by Protestant to be part of a program to create housing and jobs in black and Hispanic low- and moderate-income sections of Philadelphia. Protestant has raised many of these claims in a lawsuit filed in federal court. The district court for the Eastern District of Pennsylvania sustained Mellon's motion to dismiss Protestant's lawsuit, and Protestant has appealed the court's decision. The Board believes that the courts will afford an adequate remedy to Protestant if one is warranted. investment companies in the United States. 9 Over 95 percent of TBC Advisors's business represents the provision of administrative services to funds that are advised by other unaffiliated companies. Mellon proposes to continue to provide these services through TBC Advisors. The administrative services provided to mutual funds and closed-end funds by TBC Advisors include computing the fund's net asset value and performance data, coordinating communications and activities between the investment advisor and the other service providers, accounting and recordkeeping, disbursing payments for fund expenses, providing office space for the funds, and preparing and filing tax and regulatory reports for the funds. In connection with these administrative services, TBC Advisors often provides employees that become officers or directors of the funds. TBC Advisors also provides investment advisory services in combination with administrative services to a small group of funds. 10 I. Glass-Steagall Act The administrative services that Mellon proposes to provide through TBC Advisors and its affiliates raise a number of issues under the Glass-Steagall Act. Under the Glass-Steagall Act, a company that owns a member bank may not control "through stock ownership or in any other manner" a company that engages principally in distributing, underwriting or issuing securities. 11 In 1972, the Board issued an interpretive rule that explained the Board's view that the provisions of the Glass-Steagall Act govern the relationship between mutual funds and companies that own member banks because mutual funds engage continuously in issuing and redeeming securities. 12 The Board found that the Glass-Steagall Act prohibited affiliates of banks from sponsoring, organizing, or controlling mutual funds 13 or distributing their shares. 9. All of these investment companies are registered under the Investment Company Act of 1940 (15 U.S.C. § 80a-l et seq.). 10. In addition, BSD&T often serves as custodian to a mutual fund and might serve as custodian in cases where TBC Advisors is the mutual fund's administrator or advisor. A complete list of the proposed administrative services is attached as Appendix A. 11. 12 U.S.C. §§ 221a, 377. 12. 12 C.F.R. 225.125. 13. The Board found, on the other hand, that the prohibitions of the Glass-Steagall Act did not apply to closed-end funds as long as the closed-end fund was not engaged frequently in the issuance, sale or distribution of securities. On this basis, the Board has by regulation authorized bank holding companies to sponsor, organize, and manage closed-end funds. 12 C.F.R. 225.25(b)(4)(ii). A closed-end fund that is controlled by a bank holding company must conform its activities and investments to the requirements of section 4 of the BHC Act. Mellon has committed that if it sponsors, organizes, or controls any closedend fund Mellon will limit any such fund's investments to less than 5 percent of the voting shares of any issuer. Legal Developments The Board also found, however, that the GlassSteagall Act does not prohibit all relationships between a bank holding company and a mutual fund. In particular, the Board determined that it was permissible under the BHC Act and the Glass-Steagall Act for bank holding companies to provide investment advice to mutual funds. In addition, the Board found that the Glass-Steagall Act did not prohibit bank holding companies from providing certain other services to mutual funds, such as acting as custodian, transfer agent, or registrar. The Board imposed a number of restrictions on the relationship between bank holding companies and mutual funds in order to avoid conflicts of interest and to address potential safety and soundness concerns. 14 Thus, banks and affiliates of banks may currently perform four of the six major services needed by a mutual fund: they may serve as investment advisor, transfer agent, custodian, and registrar. They may not act as distributor to the fund. This application raises the question whether it is consistent with the GlassSteagall Act for an affiliate of a member bank to act as administrator to a mutual fund. Permissibility of Proposed Activities Mellon has recognized that certain of the current activities of TBC Advisors and its affiliates are prohibited by the Glass-Steagall Act, and has taken steps to discontinue these activities. For example, Mellon proposes to terminate the role of TBC Advisors as a sponsor of new mutual funds. In addition, Mellon will not acquire the subsidiaries of TBC that engage in the distribution of mutual fund shares. 15 At this time, 14. The Board's rule includes restrictions that prevent a bank holding company or any of its subsidiaries from: (1) Acting as investment advisor to an investment company that has a name similar to the holding company or any of its subsidiary banks, (2) Purchasing for its own account shares of any investment company for which the holding company serves as investment advisor, (3) Purchasing in its sole discretion in a fiduciary capacity shares of an investment company advised by the holding company, (4) Extending credit to an investment company advised by the holding company, (5) Accepting shares of an investment company advised by the holding company as collateral for a loan used to purchase shares of the investment company. In addition, the rule requires that, in cases in which a customer purchases or sells securities of the fund through the holding company or is advised by the holding company to purchase shares of the fund, the customer be informed in writing of the involvement of the holding company with the fund, and be informed that the shares of the fund are not federally insured, and are not guaranteed by, or obligations of, a bank. 15. Mellon will not be involved in the distribution of the shares of any mutual fund. Mellon has represented to the Board that following the acquisition of BGH by Mellon, neither TBC Advisors nor any of its affiliates would be obligated by any agreement to engage in any 629 Mellon does not propose to provide administrative services to mutual funds that are marketed and sold primarily to customers of BSD&T or any of Mellon's other subsidiary banks. The Board believes that Mellon's proposal to provide the administrative services described in Appendix A to mutual funds is permissible under the GlassSteagall Act. A mutual fund administrator provides services that are primarily ministerial or clerical in nature, and does not have policy-making authority or control over the mutual fund. 16 The policy-making functions rest with the board of directors of the fund, which is responsible for the selection and review of the major contractors to the fund, including the investment advisor, and under certain circumstances, the administrator. The Investment Company Act of 1940 (the "1940 Act") requires that these contracts be reviewed at least annually by the board of directors of the mutual fund, and that these contracts be terminable by the board of directors on no more than 60 days written notice. 17 In addition, the 1940 Act requires that at least 40 percent of the board of directors of a mutual fund be comprised of disinterested individuals who are not affiliated with the investment advisor, with any person that the SEC has determined to have a material business or professional relationship with the fund, with any employee or officer of the fund, with any registered broker or dealer, or with any other interested or affiliated person. 18 These unaffiliated board members must approve the fund's contracts with its investment advisor, underwriter, and often its administrator. Mellon has committed that, following its acquisition, TBC Advisors will provide administrative services only to mutual funds whose boards of directors consist of a majority of disinterested persons. sales activities with regard to any mutual fund's shares, and would not into enter any distribution agreement with any mutual fund unless permitted to do so by a change in current law. TBC Advisors will not engage in the development of marketing plans except to give advice to the distributor regarding regulatory compliance. Mellon has also represented to the Board that TBC Advisors will not engage in advertising activities with respect to the funds and will not be involved in the preparation of a fund's sales literature, except to review such sales literature for the sole purpose of ensuring compliance with all pertinent regulatory requirements. Employees of TBC Advisors would present information about the operations of a fund at meetings or seminars for brokers of a fund, but sales activities, if any, at such events would be conducted solely by the fund's distributer. 16. The administrator is usually compensated according to a formula that is dependent on the amount of assets in the fund, rather than on a negotiated fee basis. This formula for compensation would not appear to create the subtle hazards at which the Glass-Steagall Act was aimed that are associated with having a salesman's stake in the fund. The administrator is not involved in the promotion or sale of the fund's shares, and is charged with completing largely ministerial duties that do not require or involve contact with the public in a promotional or sales role. 17. 15 U.S.C. § 80a-15. 18. 15 U.S.C. §§ 80a-2, 80a-10. 630 Federal Reserve Bulletin • June 1993 Mellon also proposes, in situations in which Mellon subsidiaries serve as administrator to a mutual fund, to permit one representative of the administrator to serve as a director of the fund. Mellon contends that an interlocking director would facilitate its provision of administrative services to the fund. 19 A director interlock provides the fund with an individual who is knowledgeable in the operation of the fund and can directly advise the board of directors on administration. Mellon proposes to have a director interlock only in situations in which a company unaffiliated with Mellon serves as the investment advisor to the mutual fund. This unaffiliated investment advisor would be an independent and countervailing source of information to the fund's board of directors. Moreover, Mellon has represented that, where TBC Advisors serves as the administrator to a mutual fund, this interlocking director would be deemed to be an interested person and would be excluded from actions that must be taken by the disinterested board members, such as approval of the investment advisory contract and of the administrator's contract. As discussed above, Mellon has also committed that it will only serve as administrator to mutual funds for which a majority of the board of directors are disinterested individuals. Thus, there are a number of counterbalancing parties and significant limits on the participation of the administrator's representative on the fund's board of directors. Under these circumstances, the Board believes that Mellon would not control a mutual fund if one employee of TBC Advisors or an affiliate 20 also serves as a director of a mutual fund to which TBC Advisors provides administrative services. 21 19. Mellon also proposes that employees of TBC Advisors be permitted to serve as junior officers (i.e., in positions no higher than treasurer, secretary of the board, or vice president) or employees of mutual funds administered by TBC Advisors. The duties of these lower level officers include preparing agendas and minutes of board meetings, drafting routine correspondence, signing regulatory filings, and supervising and reviewing accounting and recordkeeping for the fund. These individuals have no policy-making authority, though they may have authority to make routine operational decisions, such as authorizing the purchase of supplies and the employment of clerical staff. This proposal would not change the ministerial nature of Mellon's role as administrator provided that these employees are not responsible for, or involved in making recommendations regarding, policy-making functions. 20. This director could not serve as an officer, director, or employee of Mellon, Mellon Bank, or any subsidiary bank or bank holding company of Mellon. 21. In a small number of cases, TBC Advisors currently owns shares in certain mutual funds that it administers. Mellon has proposed to retain its ownership interest in funds that it currently administers, but, within two years, to reduce that ownership interest to below 5 percent of each fund's shares. Mellon proposes to discontinue the practice of providing seed capital to new mutual funds that it hopes to administer, although Mellon has requested that it be permitted to purchase up to 5 percent of any fund to which it provides only administrative services. The Board believes that Mellon's proposal to purchase up to Mellon also proposes in a small number of cases to provide mutual funds with a combination of administrative, investment advisory, and other services. 22 The Board notes that the OCC has expressly permitted national banks that serve as investment advisor to mutual funds also to provide some administrative services to those mutual funds, such as maintaining records on shareholder accounts, posting and reinvesting dividends in accordance with customer instructions, preparing periodic statements of account, and transferring and receiving money by wire. 23 In addition, a number of national banks are already providing these and other services as "sub-administrator" to mutual funds that are advised by the bank or an affiliate. 24 As explained above, the Board has already determined that bank holding companies may serve as the investment advisor to mutual funds, and, therefore, that a bank holding company that serves as investment advisor to a mutual fund does not control the fund for purposes of the Glass-Steagall Act. In the Board's opinion, permitting a bank holding company that serves as the investment advisor to a mutual fund also to provide the essentially ministerial or supporting functions as administrator to that fund would not significantly increase the ability of the bank holding company to control the mutual fund. TBC Advisors would not, by virtue of becoming administrator to a fund that it or an affiliate advises, become involved in policy-making functions of these funds to a greater extent than when TBC Advisors provides solely investment advisory services. The Board believes that control of the fund would continue to rest with the board of directors of the fund, which would be independent of TBC Advisors. 25 In 5 percent of any fund to which it provides administrative services (but not investment advisory services) would not significantly increase Mellon's ability to exercise control over the fund for purposes of the Glass-Steagall Act. However, the Board conditions its determination on the requirement that Mellon's ownership of the fund not be used in any way in marketing or selling the shares of the fund. 22. This proposal does not involve providing both administrative and investment advisory services to so-called proprietary mutual funds that are sold primarily to customers of subsidiary banks of Mellon. 23. See, e.g., Letter dated January 14, 1985, from Legal Advisory Services Division, Office of the Comptroller of the Currency. See also Letter dated January 13, 1993, from Director for Bank Supervision and Analysis, Western District Office, Office of the Comptroller of the Currency (proposal by a national bank to invest in a partnership that provides investment advisory and a wide range of administrative services to mutual funds). 24. These activities appear to involve primarily recordkeeping and accounting activities, participation in the preparation of documents needed to comply with regulatory requirements, preparation of documents in connection with shareholder meetings or board of directors meetings, and the provision of clerical support. 25. When administrative services are provided together with advisory services, Mellon represents that directors who are not considered interested persons of the investment advisor must also review and Legal Developments this regard, Mellon has committed that it will not have any director or officer interlocks with mutual funds to which Mellon provides both advisory and administrative services. 26 Moreover, as noted above, Mellon would provide administrative services only to mutual funds in which at least a majority of the board of directors are comprised of disinterested individuals. In providing this combination of services, Mellon and TBC Advisors would also be subject to the restrictions set forth in the Board's interpretive rule on investment advisory activities (12 C.F.R. 225.125). 27 The Board's rule requires any bank holding company that acts as agent in the purchase or sale of shares of an investment company advised by a holding company affiliate, or that recommends the purchase or sale of such shares to any customer, to disclose to the customer in writing the role of the bank holding company and its affiliates with the investment company. In addition, the bank holding company must disclose in writing that the shares of the investment company are not federally insured, are not deposits, and are not obligations of, or guaranteed by, any bank. The interpretive rule also provides that an investment company advised by a bank holding company not have a name that is similar to, or a variation of, the name of any bank holding company or any of its subsidiary banks. 28 In addition, the Board's rule prohibits a bank holding company from owning shares of any mutual fund that it advises, from purchasing in a fiduciary capacity in its sole discretion shares of these mutual funds, and from lending to any such fund or accepting shares of such funds as collateral for any loan for the purpose of acquiring shares of the fund. Mellon must conform the activities of TBC Advisors and its affiliates with mutual funds to the Board's rule within two years of the date of this Order. On this basis, and subject to the commitments made by Mellon and compliance with the Board's interpretive rule, the Board believes that Mellon's proposal to provide both investment advisory and administrative services to mutual funds is not prohibited by the Glass-Steagall Act. approve the administrator's contract. The directors of an investment company may also terminate these contracts on 60 days notice. 26. Mellon has proposed in these situations to provide a limited number of employees who may serve as non-officer employees of the mutual fund. These employees will help in administration of the funds. These employees will not have any policy-making or decision-making authority, and will be supervised by independent officers and the board of directors. The Board believes that these limited employee interlocks, under the conditions described in this Order, would not permit Mellon to control the fund. 27. These and certain other provisions of the Board's rule also apply to Mellon's proposed involvement with closed-end investment companies that it proposes to advise. 28. 12 C.F.R. 225.125(f). 631 II. Bank Holding Company Act The Board has previously determined by regulation that a bank holding company may act as investment advisor to a mutual fund. 29 However, the Board has not determined whether acting as the administrator for a mutual fund meets the requirements of section 4(c)(8) of the BHC Act. Under section 4(c)(8) of the BHC Act, a nonbanking activity is permissible if it is closely related to banking and a proper incident thereto. Under Board and court precedent, an activity is closely related to banking for purposes of section 4(c)(8) if banks generally: (1) Conduct the proposed activity; (2) Provide services that are operationally or functionally so similar to the proposed activity as to equip them particularly well to provide the proposed services; or (3) Provide services that are so integrally related to the proposed service as to require their provision in a specialized form. 30 The proposed administrative services consist of, among other things, maintaining the financial and corporate records of a mutual fund; computing the net asset value, dividends, and performance data regarding the fund; providing information about the fund to the fund's board of directors, outside auditors, and distributor; coordinating the activities of the fund's other service providers; preparing regulatory filings such as tax returns and SEC registration statements; and reviewing the activities of other service providers for regulatory compliance. 31 A number of national banks currently provide some types of administrative services to mutual funds. 32 Banks also provide similar recordkeeping and accounting functions in connection with products such as individual retirement accounts. National bank trust departments also perform administrative services for collective investment funds, trust accounts, and employee benefit plans that are operationally and functionally similar to those that a mutual fund requires. 33 29. 12 C.F.R. 225.25(b)(4). 30. See National Courier Association v. Board of Governors, 516 F.2d 1229, 1237 (D.C. Cir. 1975). The Board may also consider any other factor than an applicant may advance to demonstrate a reasonable or close connection or relationship to banking. 49 Federal Register 794, 806 (1984); Securities Industry Ass'n v. Board of Governors, 468 U.S. 207, 210-11 n.5 (1984). 31. See Appendix A for a complete list of administrative services. 32. See Letter dated January 13, 1993, from Director for Bank Supervision and Analysis, Western District Office, Office of the Comptroller of the Currency. 33. See 12 C.F.R. Part 9. 632 Federal Reserve Bulletin • June 1993 The Board also has permitted bank holding companies to provide certain individual services provided by a mutual fund administrator, including financial data processing services (such as calculation of investment values and tax consulting services). 34 For these reasons the Board finds that Mellon's engaging in the proposed activities is closely related to banking, and, therefore, a permissible activity for bank holding companies to provide under section 4(c)(8) of the BHC Act. 3 5 As discussed above, the provision of administrative services within certain parameters is not likely to result in the types of subtle hazards at which the Glass-Steagall Act is aimed or any other adverse effects. For the same reasons, the Board finds that the public benefits of engaging in the proposed administrative activities outweigh the likely adverse effects and, therefore, that the activities are a proper incident to banking for purposes of section 4(c)(8) of the BHC Act. Based on all the facts of record, including all of the commitments and representations made by Mellon in this case, and subject to all of the terms and conditions set forth in this Order, the Board has determined that the applications should be, and hereby are, approved. 36 The Board's determination is subject to all of the conditions set forth in the Board's Regulation Y, including those in sections 225.4(d) and 225.23(b), and to the Board's authority to require modification or termination of the activities of a bank holding company or any of its subsidiaries as the Board finds necessary to assure compliance with, and to prevent evasion of, the provisions of the BHC Act and the Board's regulations and orders issued thereunder. The Board's decision is specifically conditioned on compliance with all of the commitments and representations made in these applications, including the commitments and conditions discussed in this Order. The commitments, representations, and conditions relied on in 34. 12 C.F.R. 225.25(b)(7) and (b)(21). 35. In determining whether an activity is a proper incident to banking, the Board must consider whether the activity "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." The record does not indicate that the proposal would result in adverse effects such as undue concentration of resources, decreased or unfair competition, conflicts of interest, or unsound banking practices. In addition, the proposed activity should benefit from the operational support that Mellon is able to provide which will create greater convenience for TBC's mutual fund clients. 36. The Board has also considered Mellon's proposal to acquire Boston Safe Deposit and Trust Company (U.K.) Limited, Premier Unit Trust Administration Limited, and The Boston Company Advisors (Bermuda) Ltd., the foreign subsidiaries of TBC. After consideration of all the factors specified in Regulation K and based on all of the facts of record, the Board has determined that disapproval of these proposed investments is not warranted. reaching this decision shall be deemed to be conditions imposed in writing by the Board in connection with its findings and decision and may be enforced in proceedings under applicable law. This transaction shall not be consummated before the thirtieth calendar day following the effective date of this Order, or later than three months after the effective date of this Order, unless such period is extended for good cause by the Board or by the Federal Reserve Bank of Cleveland, acting pursuant to delegated authority. By order of the Board of Governors, effective April 21, 1993. Voting for this action: Chairman Greenspan and Governors Kelley, Lindsey, and Phillips. Voting for this action subject to conditions: Governors Angell and LaWare. Absent and not voting: Governor Mullins. JENNIFER J. JOHNSON Associate Secretary of the Board Appendix A List of Administrative Services (1) Maintaining and preserving the records of the fund, including financial and corporate records; (2) Computing net asset value, dividends, performance data and financial information regarding the fund; (3) Furnishing statistical and research data; (4) Preparing and filing with the SEC and state securities regulators registration statements, notices, reports and other material required to be filed under applicable laws; (5) Preparing reports and other informational materials regarding the fund including proxies and other shareholder communications and reviewing prospectuses; (6) Providing legal and regulatory advice to the fund in connection with its other administrative functions; (7) Providing office facilities and clerical support for the fund; (8) Developing and implementing procedures for monitoring compliance with regulatory requirements and compliance with the fund's investment objectives, policies, and restrictions as established by the fund's board; (9) Providing routine fund accounting services and liaison with outside auditors; (10) Preparing and filing tax returns; (11) Reviewing and arranging for payment of fund expenses; (12) Providing communication and coordination services with regard to the fund's investment advisor, transfer agent, custodian, distributor and other service Legal Developments organizations that render recordkeeping or shareholder communication services; (13) Reviewing and providing advice to the distributor, the fund and investment advisor regarding sales literature and marketing plans to assure regulatory compliance; (14) Providing information to the distributor's personnel concerning fund performance and administration; (15) Participation in seminars, meetings, and conferences designed to present information to brokers and investment companies, but not in connection with the sale of shares of the funds to the public, concerning the operations of the funds, including administrative services provided by Mellon to the funds; (16) Assisting existing funds in the development of additional portfolios; and (17) Providing reports to the fund's board with regard to its activities. Appendix B Nonbanking Companies to be Acquired (1) The Boston Finance Company, Boston, Massachusetts, which would engage in making and servicing loans pursuant to section 225.25(b)(1) of the Board's Regulation Y; (2) Boston Safe Deposit and Trust Company of California, Los Angeles, California; and (3) Boston Safe Deposit and Trust Company of New York, New York, New York, which would provide trust services pursuant to section 225.25(b)(3) of the Board's Regulation Y; (4) The Boston Company Institutional Investors, Inc., Boston, Massachusetts; (5) The Boston Company of Southern California, Los Angeles, California; (6) Boston Hambro Corp., New York, New York; (7) The Boston Company Financial Strategies Group, Inc., Boston, Massachusetts; (8) The Boston Company Financial Strategies, Inc., Boston Massachusetts; (9) The Boston Company Income Securities Advisors, Inc., Boston, Massachusetts; and (10) The Boston Company Energy Advisors, Inc., Boston, Massachusetts; which would provide investment advisory services pursuant to section 225.25(b)(4) of the Board's Regulation Y; (11) The Boston Company Real Estate Counsel Inc., Boston, Massachusetts, which would provide trust services and investment advisory services pursuant to sections 225.25(b)(3) and (4) of the Board's Regulaion Y. Concurring Statement LaWare 633 of Governors Angell and We concur in the Board's decision that the administrative services that Applicant proposes to provide to mutual funds in this case are permissible under the Glass-Steagall Act and the Bank Holding Company Act. Banks have been providing investment advisory services and at least some administrative services to mutual funds for some time. However, we believe that an administrator to a mutual fund should not be permitted to have representation on the board of directors of any mutual fund that it administers. We are concerned that this representation would permit the administrator to have direct input into, and participation in, the policy-making decisions of the board of directors, and creates the potential for exercise of control over the fund. We have similar concerns regarding Applicant's proposal to own shares of mutual funds that it administers. Accordingly, while we agree with the majority that the proposal to provide administrative services to mutual funds either alone or in combination with investment advisory services, is consistent with the Glass-Steagall Act, we would condition approval of this application on a requirement that the Applicant not have any director interlocks with, or own any shares of, any mutual fund for which Applicant is the administrator. April 21, 1993 Orders Issued Under Federal Reserve Act T e x a s State Bank McAllen, Texas Order Approving the Establishment of a Branch Texas State Bank, McAllen, Texas ("Bank"), a state member bank, has applied pursuant to section 9 of the Federal Reserve Act (12 U.S.C. § 321 et seq.) to establish a branch office at 900 East Jackson Avenue, McAllen, Texas. Notice of the application, affording interested persons an opportunity to submit comments, has been published. 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 9 of the Federal Reserve Act. Bank is a subsidiary of Texas Regional Bancshares, Inc., McAllen, Texas ("Texas Regional"). Bank, with approximately $375.1 million in deposits, has three 634 Federal Reserve Bulletin • June 1993 offices located throughout McAllen, Texas. 1 This proposal would increase to five the number of offices that Bank would operate in Hidalgo County, Texas. In considering an application by a state member bank to establish an additional branch, the Board is required to consider the convenience and needs of the community to be served and to take into account the institution's record of performance under the Community Reinvestment Act ("CRA"). 2 The CRA requires the federal financial supervisory agencies to encourage financial institutions to help meet the credit needs of the local communities in which they operate consistent with the safe and sound operation of such institutions. To accomplish this end, the CRA requires the appropriate federal supervisory authority to "assess the institution's record of meeting the credit needs of its entire community, including low- and moderateincome neighborhoods, consistent with the safe and sound operations of such institution," and to take that record into account in its evaluation of applications for deposit facilities. In connection with this application, the Board has received comments in support of the proposal from an individual and the Lower Rio Grande Valley District Office of the Small Business Administration ("SBA District Office"). In particular, the SBA District Office noted Bank's expanded participation with the SBA to increase aid to the small business community. The Board also has received comments from an individual ("Protestant") alleging that the proposed branch would not be located in a low- and moderate-income area and that Bank is not meeting the credit needs of the Hispanic community in McAllen, Texas. 3 The Board has carefully reviewed the CRA performance record of Bank, as well as the comments received, and all the other relevant facts of record, in light of the Statement of the Federal Financial Supervisory Agencies regarding the Community Reinvestment Act ("Agency CRA Statement"). 4 The Board also notes that Protestant raised similar allegations relating to Bank's record of performance under the CRA in connection with the Board's approval last year of the applications by Texas Regional and Bank to 1. Deposit data are as of December 31, 1992. 2. See e.g., First American Bank-Ann Arbor, 78 Federal Reserve Bulletin 450 (1992); see also 12 U.S.C. §§ 321, 2902(3)(c), 2903(2); 12 C.F.R. 208.5. 3. Protestant also states that more Hispanics should be employed or serve in decision making positions at Bank and in the community in general. Although the Board fully supports programs designed to promote equal opportunity in every aspect of a bank's personnel policies and practices in the employment, development, advancement, and treatment of employees, the Board believes that the alleged deficiencies in Bank's general personnel and employment practices are beyond the scope of the factors that the Board may properly consider under the CRA or the convenience and needs factor. 4. 54 Federal Register 13,742 (1989). acquire certain banking institutions. 5 Protestant's allegations were reviewed extensively at that time. Record of Performance Under the CRA A. CRA Performance Examination The Agency CRA Statement provides that a CRA examination is an important, and often controlling, factor in the consideration of an institution's CRA record and that these reports will be given great weight in the application process. 6 Bank received an overall "satisfactory" rating in the examination of its CRA performance conducted by the Federal Reserve Bank of Dallas ("Reserve Bank") as of July 22, 1991 (the "1991 Examination"). In addition, the Reserve Bank recently completed another examination of Bank's CRA performance and has preliminarily concluded that Bank's record of performance remains "satisfactory" (the "1993 Examination"). B. Aspects of CRA Performance Policies and Programs. The Board previously concluded in the Texas Regional Order that Bank has in place the types of programs designed to assist the bank in meeting the credit needs of its entire community, including low- and moderate-income neighborhoods. For example, Bank has appointed a senior official as its CRA officer. In addition, the CRA program in place at Bank includes a compliance committee that meets every two months. The records of this committee indicate that it actively monitors Bank's consumer compliance and CRA program. Ascertainment and Marketing. The 1993 Examination found that Bank is adequately assessing the needs of its local community. Since the 1991 Examination, Bank has been involved with more than 180 community and civic organizations in order to ascertain the needs of its community. Bank also uses radio, television, and newspaper advertisements, and its loan-todeposit ratio reflects a demand for its products. In addition, Bank has placed brochures printed in both Spanish and English in the lobbies of each of its offices as of year-end 1992. The brochure solicits comments about credit needs, services and deposit needs. In the Texas Regional Order, the Board noted that Bank could improve the documentation of its ascertainment and marketing efforts, and the 1993 Examination found that Bank had increased its marketing efforts in 1992. 5. Texas Regional Bancshares, Inc., 78 Federal Reserve Bulletin 289 (1992) (the "Texas Regional Order"). 6. 54 Federal Register at 13,745. Legal Developments Community Development and Lending Activities. In the Texas Regional Order, the Board also found that Bank actively participates in projects that support community development activities. In this regard, the chairman of Bank's board of directors serves as the president of McAllen Affordable Homes ("MAH"), a corporation that provides funds for the development of subdivisions for first time home buyers with low- to moderate-incomes. Financing is provided at favorable interest rates and is funded by Community Development Building Grants, City of McAllen funds, and loans from local banks including Bank. Moreover, Bank's executive vice president in charge of lending serves as president of Ronco Enterprises, Inc., a corporation that engages in real estate development of low-income, single family housing, provides counseling to individuals on how to qualify for a mortgage, and provides assistance in avoiding default. Bank also has purchased loans from the Harlingen Community Development Corporation that were made to borrowers in low- and moderate- income areas. In addition, Bank expanded the terms of its unsecured lending program from 18 to 24 months because of demand for such loans. There is no minimum loan amount, and Bank has reduced certain qualifying ratios for the loans. Bank also has been involved with the Weslaco Development Committee, which provides assistance in increasing business development and employment opportunities. With respect to small business lending, Bank continues to participate in government-guaranteed lending programs, such as those of the Small Business Administration ("SBA"). Since the 1991 Examination, Bank has become a certified SBA lender, and is the only certified SBA lender in the community. Since July 1991, SBA loans have increased from $783,000 to approximately $5 million. This year, Bank also conducted a Small Business Development Workshop with the SBA and other community organizations that was attended by a number of small business owners. 7 Location of Branch. Bank's proposed branch will be located in the southern area of McAllen on a major thoroughfare that is near four low- and moderateincome census tracts and will offer a full range of banking services. This area is newly developed and employs more than 3,000 residents, the majority of whom are minorities. Bank selected this location after its ascertainment efforts revealed a need for a branch, and community contacts that the Reserve Bank ques- 7. Bank has received two new loan requests as a result of the workshop. Since the 1991 Examination, Bank also has committed $25,000 to the University of Texas-Pan American and $25,000 to the Texas State Technical College to establish scholarship funds to be managed at the discretion of the schools. 635 tioned indicated that this area was not adequately served by financial institutions. C. HMD A Data and Lending Practices The Board has reviewed the 1992 data reported by Bank under the Home Mortgage Disclosure Act ("HMDA"). 8 These data indicate some disparities in lending to minorities, including Hispanics, and in certain low- and moderate-income tracts in McAllen. The Board is concerned when the record of an institution indicates disparities in lending to minority applicants and believes that all banks are obligated to ensure that their lending practices are based on criteria that ensure not only safe and sound lending, but also ensure equal access to credit by creditworthy applicants regardless of race. The Board recognizes, however, that HMDA data alone provide only a limited measure of any given institution's lending in the communities that the institution serves. The Board also recognizes that HMDA data have limitations that make the data an inadequate basis, absent other information, for conclusively determining whether an institution has engaged in illegal discrimination on the basis of race or ethnicity in making lending decisions. The Board notes that the 1993 Examination found no evidence of illegal discrimination or other illegal credit practices at Bank. In this regard, denied applications reviewed by examiners revealed borrowers who lacked sufficient income to qualify for the loan amount requested, had poor credit histories, or had high debt-to-income ratios. In addition, examiners noted efforts by Bank to qualify marginal borrowers for loans. Examiners also reviewed real estate records in connection with Bank's housing-related lending activities in certain low- and moderate-income areas. These records demonstrated that there had been no houses listed for sale in these low- and moderateincome areas in the past year, and that large portions of these low- and moderate-income census tracts do not contain housing that would be available for resale. 9 8. The HMDA requires banks to report certain information regarding loan applications, approvals, and denials to the various banking agencies and the public. This information includes data on the race, gender, and income of individual loan applicants, as well as the location of the property securing the potential loan, and a description of the application. 9. The 1993 Examination found that Bank needs to improve its use of data relating to the geographic distribution of Bank's loans. Bank has recently completed an overall consolidation of its data processing operations required by the acquisitions approved in the Texas Regional Order. In this regard, the Board expects Bank to continue its efforts to identify the geographic distribution of its applications and denials, to analyze this data, and to implement appropriate steps, if necessary, to assist in meeting the credit needs of its entire community. 636 Federal Reserve Bulletin • June 1993 D. Conclusion Regarding Convenience and Needs Factor The Board has carefully considered the entire record, including the comments filed in this case, in reviewing the convenience and needs factor under the CRA. Based on a review of the entire record of performance, including information provided by the Protestant and by Bank, the Board believes that the efforts of Bank to help meet the credit needs of all segments of the communities served by Bank, including low- and moderate-income neighborhoods, and all other convenience and needs considerations are consistent with approval. On the basis of all the facts of record, including the Board's determinations in the Texas Regional Order, the Board concludes that the convenience and needs considerations, including the CRA performance record of Bank, are consistent with approval of this application. Other Factors The Board also has reviewed the other factors it is required to consider in applications for establishing and operating branches under the Federal Reserve Act. 1 0 Based on all the facts of record, the Board believes that the financial condition of Bank, the general character of its management, and the proposed exercise of corporate powers are consistent with approval and the purposes of section 9 of the Federal Reserve Act. Based on the foregoing and all of the facts of record, the Board has determined that this application should be, and hereby is, approved. The Board's approval is specifically conditioned upon compliance by Bank with all the commitments made in connection with this application. For purposes of this action, the commitments and conditions relied on by the Board in reaching this decision are both conditions imposed in writing by the Board in connection with its findings and decision, and as such may be enforced in proceedings under applicable law. This branch shall be in operation no later than one year after the effective date of this Order, unless such period is extended for good cause by the Board or the Federal Reserve Bank of Dallas, acting pursuant to delegated authority. By order of the Board of Governors, effective April 19, 1993. 10. See 12 U.S.C. § 322; 12 C.F.R. 208.5. Voting for this action: Chairman Greenspan and Governors Angell, Kelley, LaWare, Lindsey, and Phillips. Absent and not voting: Vice Chairman Mullins. JENNIFER J. JOHNSON Associate Secretary of the Board Orders Issued Under International Banking Act Coutts & Co., AG Zurich, Switzerland Order Approving Establishment of a Branch Coutts & Co., AG, Zurich, Switzerland ("Bank"), a foreign bank within the meaning of the International Banking Act ("IBA"), has applied under section 7(d) of the IBA to establish a state-licensed branch in New York, New York. 12 U.S.C. § 3105(d). A foreign bank must obtain the approval of the Board to establish a branch, agency, commercial lending company, or representative office in the United States under the Foreign Bank Supervision Enhancement Act of 1991 ("FBSEA"), which amended the IBA. Notice of the application, affording interested persons an opportunity to submit comments, has been published in a newspaper of general circulation in New York, New York ( N e w York Times, April 2,1992). The time for filing comments has expired and no public comments were received. Bank is incorporated and licensed to act as a bank under Swiss law. Founded in 1930, Bank engages in private banking activities and also provides corporate lending, foreign exchange, money market, and securities services. Bank, with assets of $2.8 billion as of December 31, 1992, is one of the 50 largest banking and finance companies operating in Switzerland in terms of assets. Bank is a wholly owned subsidiary of National Westminster Bank, PLC, London, England ("NatWest"). Bank operates two branches in Switzerland and representative offices in Japan, Singapore, Uruguay, and New York. Bank also owns six subsidiaries. Four of these subsidiaries are incorporated in Switzerland and engage in financial, fiduciary, or portfolio management activities. One subsidiary is incorporated in the Cayman Islands, and acts as the representative office of Bank in Hong Kong. An additional subsidiary is a bank chartered in the Bahamas to take deposits. The purpose of the proposed branch is to offer private banking services in the United States. The proposed branch will assume the existing private banking business of Bank's affiliate, National West- Legal Developments minster Bank USA, New York, New York. 1 Bank has received approvals related to the establishment of the proposed branch from the relevant home country supervisors, the New York State Banking Department, and the Federal Deposit Insurance Corporation. Bank does not engage in nonbanking activities in the United States and will be a qualifying foreign banking organization within the meaning of Regulation K after establishing the proposed branch. 12 C.F.R. 211.23(b). NatWest, Bank's ultimate parent, is a foreign bank within the meaning of the IBA and Regulation K. 12 U.S.C. §3101(7); 12 C.F.R. 211.21(m). NatWest is the second largest banking group in the United Kingdom in terms of assets, which were $238.4 billion as of June 30, 1992. NatWest conducts a wide range of international operations. The U.S. operations of NatWest consist of two U.S. bank subsidiaries, an Edge corporation, three branches, two agencies, and nonbanking subsidiaries. Coutts & Co. Group, London, England ("Coutts Group"), is the holding company for the companies of the NatWest organization that provide private banking services. Coutts Group provides these services through Coutts & Co., London, England ("Coutts UK"), and through Coutts & Co. International Holding, AG, Zurich, Switzerland ("Coutts International"). Coutts International is the immediate parent of both Bank and Coutts & Co. Trust (Holdings) Ltd., Nassau, Bahamas ("Coutts Trust"), a holding company for the trust operations of Coutts Group. In order to approve an application by a foreign bank to establish a branch in the United States, the IBA and Regulation K require the Board to determine that the foreign bank applicant engages directly in the business of banking outside the United States, and has furnished to the Board the information it needs to assess adequately the application. The Board must also determine that each of the foreign bank applicant and any foreign bank parent is subject to comprehensive supervision or regulation on a consolidated basis by its home country supervisors. 12 U.S.C. § 3105(d)(2); 12 C.F.R. 211.24(c)(1). The IBA and Regulation K also permit the Board to consider additional standards. 12 U.S.C. § 3105(d)(3)-(4); 12 C.F.R. 211.24(c)(2). Bank engages directly in the business of banking outside of the United States through its banking operations in Switzerland. Bank also has provided the Board with the information necessary to assess the application through submissions that address the relevant issues. 1. In assuming these accounts, the proposed branch will neither acquire nor accept domestic retail deposits that require deposit insurance. 12 U.S.C. § 3104(c). 637 Regulation K provides that a foreign bank will be considered to be subject to comprehensive supervision or regulation on a consolidated basis if the Board determines that the bank is supervised and regulated in such a manner that its home country supervisors receive sufficient information on the foreign bank's worldwide operations, including the relationship of foreign bank to any affiliate, to assess the overall financial condition of the foreign bank and its compliance with law and regulation. 2 12 C.F.R. 211.24(c)(1). In making its determinations under this standard for each of NatWest and Bank, the Board considered the following information. Supervision of NatWest by U.K. Authorities The Bank of England is the home country supervisor of NatWest and has broad statutory powers to supervise and take enforcement action against an authorized institution, such as NatWest. The Bank of England supervises NatWest and its affiliates through a series of measures designed to ensure that NatWest complies on an ongoing basis with the conditions for obtaining authorization and operates in a prudent fashion. The conditions for granting authorization require review of, among other things, assets and financial resources and requirements, and maintenance of adequate accounting records and internal controls. The Bank of England may revoke or condition an institution's authorization if it falls out of compliance with these conditions. In conducting its supervision, the Bank of England relies primarily on the solicitation and analysis of regular reports prepared by independent accountants and the authorized institution, discussions with an institution's management and accountants, and consultation with other supervisory authorities. The Bank of England receives reports from so-called Reporting Accountants who have statutory duties with respect to the information they submit to the Bank of England. 2. In assessing this standard, the Board considers, among other factors, the extent to which the home country supervisors: (i) Ensure that the bank has adequate procedures for monitoring and controlling its activities worldwide; (ii) Obtain information on the condition of the bank and its subsidiaries and offices through regular examination reports, audit reports, or otherwise; (iii) Obtain information on the dealings with and relationship between the bank and its affiliates, both foreign and domestic; (iv) Receive from the bank financial reports that are consolidated on a worldwide basis, or comparable information that permits analysis of the bank's financial condition on a worldwide consolidated basis; (v) Evaluate prudential standards, such as capital adequacy and risk asset exposure, on a worldwide basis. These are indicia of comprehensive, consolidated supervision. No single factor is essential and other elements may inform the Board's determination. 638 Federal Reserve Bulletin • June 1993 The Bank of England also consults with other regulatory authorities that directly oversee particular portions of an authorized institution's operations. The Bank of England applies and enforces detailed provisions regarding the content of reports and the duties of persons reporting the information. Under the Banking Act 1987, penalties may be imposed on individuals who either fail to comply with an instruction of the Bank of England to disclose information or reports ordered under statutory standards, or who knowingly or recklessly provide the Bank of England with false or misleading information. 3 The Bank of England ensures that NatWest has procedures for monitoring and controlling its worldwide activities through the requirement that NatWest maintain systems for accounting, record-keeping, and internal controls. An authorized institution, such as NatWest, is required by the Bank of England to create and maintain systems of accounting, records, and internal controls that permit preparation of required reports, provide accurate information to directors and management, and permit an authorized institution to maintain consolidated information for each subsidiary. The Bank of England evaluates the adequacy of systems that NatWest maintains through a mandatory annual report that is prepared by its Reporting Accountants. NatWest monitors its operating subsidiaries, including Bank, by requiring annual, on-site audits of each subsidiary by its independent accountants. The independent accountants prepare letters regarding these audits that highlight any deficiencies found in the audit of each company's accounts, including weaknesses in internal controls, and present the letters to NatWest's internal audit and accounting departments, and to NatWest's Group Chief Financial Officer. The Bank of England is notified of persistent or serious deficiencies. The Bank of England regularly obtains information on the condition of NatWest, its overseas offices, and subsidiaries through frequent discussions with NatWest and its accountants, including its Reporting Accountants, and through periodic financial and audit reports. The Bank of England meets regularly with NatWest and its accountants, including its Reporting Accountants, to review the consolidated financial condition of NatWest, including review of the audited, consolidated accounts of NatWest and its subsidiaries and the auditing process used to prepare such accounts. 4 NatWest and its accountants must also submit to the Bank of England periodic reports on the financial 3. The independent accountants are subject to additional review and disclosure requirements through their licensing authorities. 4. The Bank of England requires NatWest to consolidate any majority-owned or controlled subsidiary that engages in credit or financial activities. condition of the organization, 5 as well as annual, independently audited financial reports for each of its principal subsidiaries, which include Bank, Coutts UK, and Coutts Trust. The Bank of England obtains information on the dealings and relationship between NatWest and its subsidiaries through required reports of aggregate large exposures and other affiliate transactions. It also restricts lending to affiliates by requiring such loans to provide market terms and serve a clear commercial purpose. The Bank of England evaluates prudential standards for NatWest on a worldwide basis. The Bank of England has implemented the risk-based capital standards of the Basle Accord, with variations that conform to applicable European Community directives. NatWest must submit capital adequacy figures on an aggregate and consolidated basis. The Bank of England also ensures that NatWest maintains sufficient liquidity, and applies limitations on credit risks and concentrations. NatWest conforms to these requirements through internal controls and policies that apply throughout its organization. Supervision of Bank by Swiss Authorities The Swiss Federal Banking Commission ("Banking Commission") is responsible for the supervision of Swiss banks and investment trusts and, as such, is the home country supervisor of Bank. 6 The powers of the Banking Commission include licensing banks, issuing directives to address violations by or irregularities involving banks, requiring information from a bank or its auditor regarding supervisory matters, and revoking bank licenses. 7 The Banking Commission exercises indirect oversight over Swiss banks through independent auditors known as Recognized Auditors that act on behalf of 5. The Bank of England requires an authorized institution, such as NatWest, to submit unconsolidated reports monthly and quarterly, and consolidated reports bi-annually. NatWest must discuss any accounting differences in other jurisdictions that substantially affect the consolidated reports with the Bank of England. 6. The Banking Commission is responsible for the direct oversight of Bank. The Bank of England, as the supervisor of NatWest and its subsidiaries, consults with the Banking Commission regarding supervision of Bank. 7. The Banking Commission may license an entity as a bank if the entity: (1) Conducts clearly defined activities with separate bodies for management, direction, supervision, and control of significant activities; (2) Holds minimum, fully-paid capital; (3) Employs bank management and administration with good reputations that ensure proper bank operations; and (4) Employs a majority of Swiss residents as managers. Legal Developments the Commission under detailed statutory provisions. 8 Each Swiss bank must appoint a Recognized Auditor, and must notify the Banking Commission of an intent to change its auditor. The Recognized Auditors may take action within a bank as deemed necessary or as instructed by the Banking Commission, and must inform the Commission of supervisory matters. The Banking Commission ensures that Bank has adequate procedures for monitoring and controlling its worldwide activities through statutory and regulatory standards for operations that each Swiss bank must meet. Among these standards are requirements for adequate internal controls, oversight, administration, and financial resources. The Banking Commission reviews compliance with these limitations on operations and with internal control requirements through an annual audit performed by the Recognized Auditor. The Banking Commission may take supervisory actions that include requiring divestiture of a subsidiary in response to supervisory concerns. Bank has adopted internal control procedures that permit it, and NatWest, to monitor Bank's operations and those of its subsidiaries. Bank also performs annual internal audits of each of its branches that review all business activities and operations, as well as compliance with internal policy and applicable laws. Bank monitors and controls its subsidiaries through annual audits of its operating subsidiaries by its Recognized Auditor. The results of these audits are communicated to the management of both Bank and NatWest. The Banking Commission obtains information on the condition of Bank, its foreign offices, and subsidiaries by requiring submission of periodic, consolidated financial reports and through the mandatory annual report by the Recognized Auditor. Generally, Swiss banks must consolidate for accounting purposes all foreign offices on a line-by-line basis, and must include any majority-owned banking, finance, or real estate subsidiary on a pro-rata or proportional accounting basis. The Banking Law requires Bank to submit annual and semi-annual balance sheets and income statements to the Banking Commission. The Banking Commission also receives information regarding capital adequacy, country risk exposure, and foreign exchange exposures from Bank annually. Information on risks (such as interest rate risk) and inter-company transactions is received through large loan reports that must be submitted both when such loans occur and 8. The Banking Commission must formally grant recognition to Recognized Auditors under statutory standards that are designed to ensure the independence and competence of the auditors and the accuracy of the auditing process. 639 annually. The Banking Commission evaluates prudential standards with respect to capital adequacy that effectively follow the risk-based capital standards of the Basle Accord. The Swiss Banking Law and Implementing Ordinance prescribe the content of the mandatory annual report of Bank by its Recognized Auditor. Under these laws, the Recognized Auditor must review and report on the financial condition of a bank, including sufficiency and valuation of assets and capital, as well as other topics. The report must express an opinion regarding compliance with the conditions for licensure, accounting accuracy, risks, adjustments, undisclosed reserves, treatment of classified assets, fiduciary operations, exposures to single borrowers, insider lending, capital, liquidity, reserve allocation, foreign assets, internal controls and organization, and compliance with monetary controls. The Swiss Banking Law contains penalties to ensure correct reporting to the Banking Commission. Recognized Auditors face penalties for gross violations of duties in auditing, for reporting misleading information or omitting essential information from the audit report, and for failing to request pertinent information or to report to the Banking Commission. Based on all the facts of record, which include the information described above, the Board concludes that each of Bank and NatWest is subject to comprehensive supervision and regulation on a consolidated basis by its respective home country supervisor. Additional Standards In considering this application, the Board has also taken into account the additional standards set forth in section 7 of the IBA. 12 U.S.C. § 3105(d)(3)-(4). As noted above, Bank has received the consent of its home country supervisor to establish the proposed branch. In addition, subject to certain conditions, the Bank of England and the Banking Commission may share information on Bank's operations with other supervisors, including the Board. As noted, Bank must comply with the Swiss capital standards that effectively follow the Basle Accord. Bank's capital exceeds these minimum standards and is equivalent to capital that would be required of a U.S. banking organization. Managerial and other financial resources of Bank are also considered consistent with approval and Bank appears to have the experience and capacity to support this additional office. Bank has established controls and procedures for its U.S. offices to ensure compliance with U.S. law. Under the IBA, the proposed state-licensed branch may not engage in any type of activity that is 640 Federal Reserve Bulletin • June 1993 not permissible for a federally-licensed branch without the Board's approval. Finally, Nat West and Bank each have committed to make available to the Board such information on the operations of Bank and any affiliate of Bank that the Board deems necessary to determine and enforce compliance with the IB A, the Bank Holding Company Act of 1956, as amended, and other applicable Federal law, to the extent not prohibited by law or regulation. The Board has reviewed the restrictions on disclosure in relevant jurisdictions in which NatWest or Bank operate and has communicated with certain government authorities concerning access to information. The Board notes that NatWest, Bank, and certain of their affiliates may not provide information without the consent of third parties. In this regard, each of NatWest and Bank also has committed to cooperate with the Board to obtain any approvals or consents that may be needed to gain access to information that may be requested by the Board. In light of these commitments and other facts of record, and subject to the condition described below, the Board concludes that Bank has provided adequate assurances of access to any necessary information the Board may request. On the basis of all the facts of record, and subject to the commitments made by NatWest and Bank, as well as the terms and conditions set forth in this Order, the Board has determined that Bank's application to establish a branch should be, and hereby is, approved. If any restrictions on access to information on the operations or activities of Bank and any of its affiliates subsequently interfere with the Board's ability to determine the safety and soundness of Bank's U.S. operations or the compliance by Bank or its affiliates with applicable Federal statutes, the Board may require termination of any of Bank's direct or indirect activities in the United States. Approval of this application is also specifically conditioned on compliance by each of NatWest and Bank with the commitments made in connection with this application, and with the conditions contained in this Order. 9 The commitments and conditions referred to above are conditions imposed in writing by the Board in connection with its decision, and may be enforced in proceedings under 12 U.S.C. § 1818 or 12 U.S.C. § 1847 against NatWest, or Bank, including its offices and its affiliates. By order of the Board of Governors, effective April 20, 1993. 9. The Board's authority to approve the establishment of the proposed branch parallels the continuing authority of the State of New York to license offices of a foreign bank. The Board's approval of this application does not supplant the authority of the State of New York, and its agent, the New York State Banking Department, to license the proposed branch of Bank in accordance with any terms or conditions that the New York State Banking Department may impose. Voting for this action: Chairman Greenspan and Governors Angell, Kelley, LaWare, Lindsey, and Phillips. Absent and not voting: Governor Mullins. JENNIFER J. JOHNSON Associate Secretary of the Board ACTIONS TAKEN UNDER THE FEDERAL DEPOSIT INSURANCE CORPORATION IMPROVEMENT ACT By the Board Mid Am, Inc. Bowling Green, Ohio Order Approving Merger of a Savings With a Commercial Bank Association Mid Am, Inc., Bowling Green, Ohio ("Mid Am"), has applied for the Board's approval to permit its subsidiary, American Community Bank, N . A . , Lima, Ohio ("Bank"), to merge with Colonial Federal Savings Bank, Bellefontaine, Ohio ("Colonial"), pursuant to section 5(d)(3) of the Federal Deposit Insurance Act (12 U.S.C. § 1815(d)(3) ("FDI Act")), as amended by the Federal Deposit Insurance Corporation Improvement Act of 1991 (Pub. L. N o . 102-242, § 501, 105 Stat. 2236, 2388-2392 (1991)). Section 5(d)(3) of the FDI Act requires the Board to follow the procedures and consider the factors set forth in the Bank Merger Act (12 U.S.C. § 1828(c)). 12 U.S.C. § 1815(d)(3)(E).> Notice of the application, affording interested persons an opportunity to submit comments, has been given in accordance with the Bank Merger Act and the Board's Rules of Procedure (12 C.F.R. 262.3(b)). In addition, reports on the competitive effects of the merger were requested from the United States Attorney General, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, and the Office of Thrift Supervision. The time for filing comments has expired, and the Board has considered the application and all comments received in light of the factors set forth in the Bank Merger Act and section 5(d)(3) of the FDI Act. Mid Am is the eleventh largest commercial banking organization in Ohio, controlling deposits of $1 billion, representing approximately 1.2 percent of total deposits in commercial banking organizations in the state. Colonial is the 84th largest thrift organization in Ohio, 1. These factors include considerations relating to competition, the financial and managerial resources and future prospects of the existing and proposed institutions, and the convenience and needs of the communities to be served. 12 U.S.C. § 1828(c). Legal Developments controlling deposits of $71.9 million, representing less than 1 percent of total deposits in thrift institutions in the state. Upon consummation of the proposed transaction, Mid Am would remain the eleventh largest commercial banking organization in Ohio, controlling deposits of $1.1 billion, representing approximately 1.2 percent of total deposits in commercial banking organizations in the state. Mid Am and Colonial compete directly in the Logan County, Ohio, banking market. 2 In that market, Mid Am is the largest of twelve commercial banking or thrift organizations (together, "depository institutions"), controlling deposits of $84.8 million, representing approximately 23.5 percent of total deposits in depository institutions in the market ("market deposits"). 3 Colonial is the third largest depository institution in the market, controlling deposits of $37.2 million, representing approximately 10.3 percent of market deposits. 4 Upon consummation of this proposal, Mid Am would control $159.2 million in deposits, representing approximately 40 percent of market deposits. The Herfindahl-Hirschman Index ("HHI") for this market would increase by 811 points to 2204. 5 In order to mitigate the adverse competitive effects that would otherwise result from consummation of this proposal, Mid Am has committed to divest one branch of Bank, with deposits of approximately $15.4 million, located in the Logan County banking market to an out-of-market banking organization. 6 Following this 2. The Logan County banking market consists of Logan County, Ohio. 3. State deposit data are as of September 30, 1992. Market deposit data are as of June 30, 1992. 4. Market share data before consummation are based on calculations in which the deposits of thrift institutions are included at 50 percent. The Board previously has indicated that thrift institutions have become, or have the potential to become, major competitors of commercial banks. See Midwest Financial Group, 75 Federal Reserve Bulletin 386 (1989); National City Corporation, 70 Federal Reserve Bulletin 743 (1984). Because the deposits of Colonial would be transferred to a commercial bank under Mid Am's proposal, those deposits are included at 100 percent in the calculation of the pro forma market share. See First Banks, Inc., 76 Federal Reserve Bulletin 669, 670 n.9 (1990); Norwest Corporation, 78 Federal Reserve Bulletin 452 (1992). 5. Under the revised Department of Justice Merger Guidelines, 49 Federal Register 26,823 (June 29, 1984), a market in which the post-merger HHI is above 1800 is considered to be highly concentrated. The Justice Department has informed the Board that a bank merger or acquisition generally will not be challenged (in the absence of other factors indicating anticompetitive effects) unless the postmerger HHI is at least 1800 and the merger increases the HHI by more than 200 points. The Justice Department has stated that the higher than normal HHI thresholds for screening bank mergers for anticompetitive effects implicitly recognize the competitive effect of limitedpurpose lenders and other non-depository financial entities. 6. Mid Am has committed to execute a binding sales agreement, acceptable to the Board, to effect this divestiture prior to the consummation of the acquisition of Colonial. In the event that the divestiture is not consummated within 180 days of the proposal, Mid Am has signed a trust agreement that provides for the transfer of the assets and 641 divestiture, Mid Am would remain the largest depository institution in the market, controlling deposits of $143.8 million, representing approximately 36.1 percent of market deposits. The HHI would increase by 532 points to 1925. The record in this case indicates that the effects that consummation of this proposal would have on competition in the Logan County banking market are mitigated by certain characteristics of this market. Following the consummation of the proposed divestiture, nine commercial banking organizations, including three of the five largest commercial banking organizations in Ohio, and three thrift institutions would operate in the Logan County banking market. The Logan County banking market also has a number of features that make it attractive for entry, including population growth, deposit growth, and the level of per capita income in the market. 7 Additionally, Ohio's nationwide reciprocal interstate banking law and its intrastate branching law permit a potentially large number of financial institutions to enter this market with relative ease. In this regard, one commercial banking organization entered the market on a de novo basis in 1990 and subsequently opened a second de novo branch in the market. In light of the number and size of competitors remaining in the Logan County banking market, the market's attractiveness to entry, the number of potential entrants into the market, and other facts of record in this case, the Board concludes that consummation of this proposal would not have a significantly adverse effect on competition or the concentration of banking resources in the Logan County banking market or any other relevant banking market. The Board also concludes that the financial and managerial resources and future prospects of Mid Am and Bank, and considerations relating to the convenience and needs of the communities to be served, are also consistent with approval of this application. Moreover, the record in this case shows that: (1) The transaction will not result in the transfer of any federally insured depository institution's federal deposit insurance from one federal deposit insurance fund to the other; (2) Mid Am and Bank currently meet, and upon consummation of the proposed transaction will continue to meet, all applicable capital standards; and liabilities to be divested to an independent trustee who will sell them promptly. 7. Logan County's population increase between 1987 and 1990 (4.4 percent), deposit growth between 1988 and 1991 (21.6 percent), and per capita income ($15,346), all exceed the average for non-MSA counties in Ohio. 642 Federal Reserve Bulletin • June 1993 (3) Because Bank is in Ohio and is merging with a savings institution located in Ohio, the proposed transaction would comply with the Douglas Amendment if Colonial were a state bank that Mid Am was applying to acquire directly. See 12 U.S.C. § 1815(d)(3). Based on the foregoing and all of the facts of record, the Board has determined that this application should be, and hereby is, approved. This approval is subject to Bank obtaining the required approval of the appropriate Federal banking agency for the proposed merger under the Bank Merger Act. The Board's approval of this application also is conditioned upon Mid Am's compliance with the commitments made in connection with this application, including the divestiture commitments discussed in this Order. For purposes of this action, the commitments and conditions relied on in reaching this decision are both conditions imposed in writing by the Board and, as such, may be enforced in proceedings ACTIONS TAKEN under applicable law. This approval is limited to the proposal presented to the Board by Mid Am, and may not be construed as applying to any other transaction. This transaction may not be consummated before the thirtieth calendar day after the effective date of this Order, or later than three months after the effective date of this Order, unless such period is extended by the Board or the Federal Reserve Bank of Cleveland, acting pursuant to delegated authority. In connection with this provision, advice of the fact of consummation should be given in writing to the Reserve Bank. By order of the Board of Governors, effective April 19, 1993. Voting for this action: Chairman Greenspan and Governors Angell, Kelley, LaWare, Lindsey, and Phillips. Absent and not voting: Governor Mullins. JENNIFER J. JOHNSON Associate UNDER THE FEDERAL DEPOSIT INSURANCE Secretary of the Board CORPORATION IMPROVEMENT ACT OF 1991 By the Director of the Division of Banking Supervision and Regulation and the General Counsel of the Board Copies are available upon request to the Freedom of Information Office, Office of the Secretary, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. Acquired Thrift Surviving Bank(s) First Citizens BancShares, Inc. Raleigh, North Carolina Caldwell Savings Bank, Inc., SSB, Lenoir, North Carolina Pickens County Bancshares, Inc., Carrollton, Alabama Secor Bank, F.S.B., Birmingham, Alabama First-Citizens Bank & Trust Company, Raleigh, North Carolina West Alabama Bank and Trust, Carrollton, Alabama Bank Holding Company APPLICATIONS APPROVED UNDER BANK HOLDING COMPANY Approval Date March 30, 1993 March 31, 1993 ACT By the Secretary of the Board Recent applications have been approved by the Secretary of the Board as listed below. Copies are available upon request to the Freedom of Information Office, Office of the Secretary, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. Legal Developments 643 Section 3 Effective Date Bank(s) Applicant(s) FirstBank Holding Company of Colorado, Lakewood, Colorado FirstBank Holding Company of Colorado Employee Stock Ownership Plan, Lakewood, Colorado First Security Corporation, Salt Lake City, Utah FirstBank of Fort Collins, Fort Collins, Colorado April 2, 1993 Desert Southwest Community Bancorp, Las Vegas, Nevada April 22, 1993 Section 4 Applicant(s) Panhandle Bancshares, Inc. Panhandle, Texas APPLICATIONS APPROVED Effective Date Bank(s) to engage de novo in providing management consulting services to nonaffiliated depository institutions and tax planning and preparation services UNDER BANK HOLDING COMPANY April 9, 1993 ACT By Federal Reserve Banks Recent applications have been approved by the Federal Reserve Banks as listed below. Copies are available upon request to the Reserve Banks. Section 3 Applicant(s) AMBANC Corp., Vincennes, Indiana BOK Financial Corporation, Tulsa, Oklahoma Bank(s) Farmers' State Bank of Palestine, Palestine, Illinois Sand Springs Bancshares, Inc., Sand Springs, Oklahoma Brookside Bancshares, Inc., Tulsa, Oklahoma Reserve Bank Effective Date St. Louis April 7, 1993 Kansas City April 2, 1993 644 Federal Reserve Bulletin • June 1993 Section 3—Continued Applicant(s) Bourbonnais Bancorp, Inc., Bourbonnais, Illinois Cashton Bancshares, Inc., Cashton, Wisconsin CNB Bancshares, Inc., Evansville, Indiana Community First Bankshares, Inc., Fargo, North Dakota Community First Bankshares, Inc., Fargo, North Dakota Crested Butte State Bank Holding Company, Crested Butte, Colorado Davis BanCorporation, Inc., Davis, Oklahoma Dimeco, Inc., Honesdale, Pennsylvania Farmers State Bancshares of Andrew County, Inc., Savannah, Missouri First Breckinridge Bancshares, Inc., Irvington, Kentucky First Linden Bancshares, Inc., Linden, Alabama First National of Nebraska, Inc., Omaha, Nebraska First Neighborhood Bancshares, Inc., Toledo, Illinois FirstPerryton Bancorp, Inc., Perryton, Texas First State Bancshares, Inc., Scottsbluff, Nebraska FNBR Holding Corporation, Meeker, Colorado Reserve Bank Bank(s) Presidential Holding Company, Bourbonnais, Illinois Bank of Cashton, Cashton, Wisconsin South Central Illinois Bancorp, Inc., Effingham, Illinois F&M Bank Holding Company, Cooperstown, North Dakota Lincoln Banking Company, Ltd., Steamboat Springs, Colorado Crested Butte State Bank, Crested Butte, Colorado First Davis Bancorporation, Inc., Davis, Oklahoma The Dime Bank, Honesdale, Pennsylvania Farmers State Bank of Rosendale, Savannah, Missouri Bank of Clarkson, Clarkson, Kentucky First Bank of Linden, Linden, Alabama First National Bank of Kansas, Overland Park, Kansas Newman Bancshares, Inc., Newman, Illinois Texas Commerce Bank Amarillo, Amarillo, Texas Security First Savings & Loan Association, Cheyenne, Wyoming First National Bank of the Rockies, Meeker, Colorado Effective Date Chicago April 8, 1993 Chicago March 30, 1993 St. Louis March 22, 1993 Minneapolis Minneapolis Kansas City April 23, 1993 April 23, 1993 March 26, 1993 Kansas City April 16, 1993 Philadelphia April 1, 1993 Kansas City March 26, 1993 St. Louis March 29, 1993 Atlanta March 26, 1993 Kansas City April 2, 1993 Chicago April 16, 1993 Dallas April 20, 1993 Kansas City April 22, 1993 Kansas City March 31, 1993 Legal Developments Section 3—Continued Applicant(s) Fourth Financial Corporation, Wichita, Kansas Illinois State Bancorp, Inc., Wheaton, Illinois International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers & Helpers, Kansas City, Kansas LeRoy C. Darby, Inc., Monona, Iowa Lincoln Trail Bancshares, Inc., Taylorville, Illinois Midlothian State Bank Employee Stock Ownership Trust, Midlothian, Illinois Oliver Bancorporation, Inc., Center, North Dakota Bank(s) Nichols Hills Bancorporation, Inc., Oklahoma City, Oklahoma Presidential Holding Company, Bourbonnais, Illinois Brotherhood Bancshares, Inc., Kansas City, Kansas Keystone Bancshares, Inc., Elkader, Iowa Palmer State Bank, Taylorville, Illinois Midlothian State Bank, Midlothian, Illinois Security State Bank of New Salem, New Salem, North Dakota Reserve Bank Effective Date Kansas City April 2, 1993 Chicago April 8, 1993 Kansas City April 16, 1993 Chicago April 16, 1993 Chicago March 26, 1993 Chicago April 14, 1993 Minneapolis March 26, 1993 Section 4 Applicant(s) The Bank of Tokyo, Ltd., Tokyo,Japan Central Bancshares, Inc., Cambridge, Nebraska The Merchants Holding Company, Winona, Minnesota Nonbanking Activity/Company BOT Financial Corporation, Boston, Massachusetts C.R. Druse Insurance, Cambridge, Nebraska Mortgage Options of La Crosse, Inc., La Crosse, Wisconsin Reserve Bank Effective Date San Francisco April 22, 1993 Kansas City March 31, 1993 Minneapolis April 15, 1993 645 646 Federal Reserve Bulletin • June 1993 APPLICATIONS APPROVED By Federal Reserve UNDER BANK MERGER ACT Banks Recent applications have been approved by the Federal Reserve Banks as listed below. Copies are available upon request to the Reserve Banks. Applicant(s) Bank of Woodward, Woodward, Oklahoma Commonwealth Bank, Williamsport, Pennsylvania PENDING CASES INVOLVING Cimarron Bank, Waukomis, Oklahoma Valley Community Bank, Kingston, Pennsylvania THE BOARD OF Effective Date Kansas City April 9, 1993 Philadelphia April 20, 1993 GOVERNORS This list of pending cases does not include suits against the Federal Reserve Banks in which the Board of Governors is not named a party. Amann v. Prudential Home Mortgage Co., et al., No. 93-10320 WD (D. Massachusetts, filed February 12, 1993). Action for fraud and breach of contract arising out of a home mortgage. Adams v. Greenspan, No. 93-0167 (D. D.C., filed January 27, 1993). Action by former employee under the Civil Rights Act of 1964 and the Rehabilitation Act of 1973 concerning termination of employment. Sisti v. Board of Governors, No. 93-0033 (D.D.C., filed January 6, 1993). Challenge to Board staff interpretation with respect to margin accounts. On April 9, 1993, the Board filed a motion to dismiss. U.S. Check v. Board of Governors, No. 92-2892 (D.D.C., filed December 30, 1992). Challenge to partial denial of request for information under the Freedom of Information Act. CBC, Inc. v. Board of Governors, No. 92-9572 (10th Cir., filed December 2, 1992). Petition for review of civil money penalty assessment against a bank holding company and three of its officers and directors for failure to comply with reporting requirements. The Board's brief was filed on March 19, 1993. DLG Financial Corporation v. Board of Governors, No. 392 Civ. 2086-G (N.D. Texas, filed October 9, 1992). Action to enjoin the Board and the Federal Reserve Bank of Dallas from taking certain enforcement actions, and seeking money damages on a variety of tort and contract theories. On October 9, 1992, the court denied plaintiffs' motion for a tem- Reserve Bank Bank(s) porary restraining order. On March 30, 1993, the court granted the Board's motion to dismiss as to it, and also dismissed certain claims against the Reserve Bank. Zemel v. Board of Governors, No. 92-1056 (D. District of Columbia, filed May 4, 1992). Age Discrimination in Employment Act case. The parties' crossmotions for summary judgment are pending. State of Idaho, Department of Finance v. Board of Governors, No. 92-70107 (9th Cir., filed February 24, 1992). Petition for review of Board order returning without action a bank holding company application to relocate its subsidiary bank from Washington to Idaho. The Board's brief was filed on June 29, 1992. Oral argument was held October 6, 1992. In re Subpoena Served on the Board of Governors, Nos. 91-5427, 91-5428 (D.C. Cir., filed December 27, 1991). Appeal of order of district court, dated December 3, 1991, requiring the Board and the Office of the Comptroller of the Currency to produce confidential examination material to a private litigant. On June 26, 1992, the court of appeals affirmed the district court order in part, but held that the bank examination privilege was not waived by the agencies' provision of examination materials to the examined institution, and remanded for further consideration of the privilege issue. On August 6,1992, the district court ordered the matter held in abeyance pending settlement of the underlying action. Board of Governors v. Kemal Shoaib, No. CV 91-5152 (C.D. California, filed September 24, 1991). Action to freeze assets of individual pending administrative Legal Developments adjudication of civil money penalty assessment by the Board. On October 15, 1991, the court issued a preliminary injunction restraining the transfer or disposition of the individual's assets. Board of Governors v. Ghaith R. Pharaon, No. 91CIV-6250 (S.D. N e w York, filed September 17, 1991). Action to freeze assets of individual pending administrative adjudication of civil money penalty assessment by the Board. On September 17, 1991, the court issued an order temporarily restraining the transfer or disposition of the individual's assets. FINAL ENFORCEMENT ORDERS ISSUED BY THE BOARD OF GOVERNORS First Pacific Bancorp, Inc. Beverly Hills, California The Federal Reserve Board announced on April 2, 1993, the issuance of Orders of Assessment of a Civil Money Penalty against First Pacific Bancorp, Inc., Beverly Hills, California, and Jose M. Anotado, an institution-affiliated party of First Pacific Bancorp, Inc. 647 Valley Bancshares, Inc., Santa Clara, California, and its subsidiary bank, the Silicon Valley Bank, Santa Clara, California, pursuant to 12 U.S.C. 1818(b). WRITTEN AGREEMENTS RESERVE BANKS APPROVED BY FEDERAL Arrow Financial Corporation Glens Falls, New York The Federal Reserve Board announced on April 5, 1993, the execution of an Amendment to the Written Agreement, dated July 22, 1992, involving the Federal Reserve Bank of N e w York, Arrow Financial Corporation, Glens Falls, N e w York, and Arrow Vermont Corporation, Rutland, Vermont. Citizens First Bancorp, Inc. Glen Rock, New Jersey Pacific Inland Bancorp Anaheim, California The Federal Reserve Board announced on April 5, 1993, the execution of an Amendment to the Written Agreement, dated December 18, 1990, between the Federal Reserve Bank of N e w York and Citizens First Bancorp, Inc., Glen Rock, N e w Jersey. The Federal Reserve Board announced on April 16, 1993, the issuance of a Cease and Desist Order against Pacific Inland Bancorp, Anaheim, California, and its subsidiary bank, the Pacific Inland Bank, Anaheim, California. Perry County Bancorp, Inc. Du Quoin, Illinois Silicon Valley Bancshares, Inc. Santa Clara, California The Federal Reserve Board announced on April 16, 1993, the issuance of a Consent Order against Silicon The Federal Reserve Board announced on April 26, 1993, the execution of Written Agreements involving the Federal Reserve Bank of St. Louis and Perry County Bancorp, Inc., Du Quoin, Illinois, a bank holding company, and its subsidiary bank, the Du Quoin State Bank, Du Quoin, Illinois. A1 Financial and Business Statistics WEEKLY REPORTING COMMERCIAL BANKS CONTENTS A3 Guide to Tabular Domestic Financial Presentation Statistics Assets and liabilities A21 Large reporting banks A23 Branches and agencies of foreign banks MONEY STOCK AND BANK CREDIT FINANCIAL MARKETS A4 A24 Commercial paper and bankers dollar acceptances outstanding A24 Prime rate charged by banks on short-term business loans A25 Interest rates—money and capital markets A26 Stock market—Selected statistics All Selected financial institutions—Selected assets and liabilities A5 A6 A7 Reserves, money stock, liquid assets, and debt measures Reserves of depository institutions, Reserve Bank credit Reserves and borrowings—Depository institutions Selected borrowings in immediately available funds—Large member banks POLICY INSTRUMENTS A8 Federal Reserve Bank interest rates A9 Reserve requirements of depository institutions A10 Federal Reserve open market transactions FEDERAL RESERVE BANKS A l l Condition and Federal Reserve note statements A12 Maturity distribution of loan and security holdings MONETARY AND CREDIT AGGREGATES A13 Aggregate reserves of depository institutions and monetary base A14 Money stock, liquid assets, and debt measures A16 Bank debits and deposit turnover A17 Loans and securities—All commercial banks COMMERCIAL BANKING INSTITUTIONS A18 Major nondeposit funds A19 Assets and liabilities, Wednesday figures FEDERAL FINANCE All A28 A29 A29 Federal fiscal and financing operations U.S. budget receipts and outlays Federal debt subject to statutory limitation Gross public debt of U.S. Treasury—Types and ownership A30 U.S. government securities dealers—Transactions A31 U.S. government securities dealers—Positions and financing A32 Federal and federally sponsored credit agencies—Debt outstanding SECURITIES MARKETS AND CORPORATE FINANCE A33 New security issues—Tax-exempt state and local governments and corporations A34 Open-end investment companies—Net sales and assets A34 Corporate profits and their distribution A34 Nonfarm business expenditures on new plant and equipment A35 Domestic finance companies—Assets and liabilities, and consumer, real estate, and business credit 2 Federal Reserve Bulletin • June 1993 Domestic REAL Financial Statistics—Continued ESTATE A36 Mortgage markets A37 Mortgage debt outstanding CONSUMER INSTALLMENT CREDIT A3 8 Total outstanding A3 8 Terms Funds raised in U.S. credit markets Summary of financial transactions Summary of credit market debt outstanding Summary of financial assets and liabilities Domestic Nonfinancial SELECTED Statistics SUMMARY Liabilities to and claims on foreigners Liabilities to foreigners Banks' own claims on foreigners Banks' own and domestic customers' claims on foreigners A61 Banks' own claims on unaffiliated foreigners A62 Claims on foreign countries—Combined domestic offices and foreign branches REPORTED BY NONBANKING BUSINESS ENTERPRISES IN THE UNITED STATES MEASURES A44 Nonfinancial business activity—Selected measures A45 Labor force, employment, and unemployment A46 Output, capacity, and capacity utilization A47 Industrial production—Indexes and gross value A49 Housing and construction A50 Consumer and producer prices A51 Gross domestic product and income A52 Personal income and saving International REPORTED BY BANKS IN THE UNITED STATES A57 A58 A60 A61 FLOW OF FUNDS A39 A41 A42 A43 A54 Foreign official assets held at Federal Reserve Banks A55 Foreign branches of U.S. banks—Balance sheet data A57 Selected U.S. liabilities to foreign official institutions Statistics STATISTICS A53 U.S. international transactions—Summary A54 U.S. foreign trade A54 U.S. reserve assets A63 Liabilities to unaffiliated foreigners A64 Claims on unaffiliated foreigners SECURITIES HOLDINGS AND TRANSACTIONS A65 Foreign transactions in securities A66 Marketable U.S. Treasury bonds and notes—Foreign transactions INTEREST AND EXCHANGE RATES A67 Discount rates of foreign central banks A67 Foreign short-term interest rates A68 Foreign exchange rates A69 Guide to Statistical Special Tables Releases and A3 Guide to Tabular Presentation SYMBOLS AND ABBREVIATIONS c e n.a. n.e.c. P r * 0 ATS CD CMO FFB FHA FHLBB FHLMC FmHA FNMA FSLIC G-7 G-10 Corrected Estimated Not available Not elsewhere classified Preliminary Revised (Notation appears on column heading when about half of the figures in that column are changed.) Amounts insignificant in terms of the last decimal place shown in the table (for example, less than 500,000 when the smallest unit given is millions) Calculated to be zero Cell not applicable Automatic transfer service Certificate of deposit Collateralized mortgage obligation Federal Financing Bank Federal Housing Administration Federal Home Loan Bank Board Federal Home Loan Mortgage Corporation Farmers Home Administration Federal National Mortgage Association Federal Savings and Loan Insurance Corporation Group of Seven Group of Ten GNMA GDP HUD IMF IO IPCs IRA MMDA NOW OCD OPEC OTS PO REIT REMIC RP RTC SAIF SCO SDR SIC SMSA VA Government National Mortgage Association Gross domestic product Department of Housing and Urban Development International Monetary Fund Interest only Individuals, partnerships, and corporations Individual retirement account Money market deposit account Negotiable order of withdrawal Other checkable deposit Organization of Petroleum Exporting Countries Office of Thrift Supervision Principal only Real estate investment trust Real estate mortgage investment conduit Repurchase agreement Resolution Trust Corporation Savings Association Insurance Fund Securitized credit obligation Special drawing right Standard Industrial Classification Standard metropolitan statistical area Veterans Administration GENERAL INFORMATION In many of the tables, components do not sum to totals because of rounding. Minus signs are used to indicate (1) a decrease, (2) a negative figure, or (3) an outflow. "U.S. government securities" may include guaranteed issues of U.S. government agencies (the flow of funds figures also include not fully guaranteed issues) as well as direct obligations of the Treasury. "State and local government" also includes municipalities, special districts, and other political subdivisions. A4 1.10 DomesticNonfinancialStatistics • June 1993 R E S E R V E S , M O N E Y STOCK, LIQUID A S S E T S , A N D D E B T M E A S U R E S Percent annual rate of change, seasonally adjusted1 1992r 1993 1992 1993 Monetary and credit aggregate 1 2 3 4 Reserves of depository Total Required Nonborrowed Monetary base 6 7 8 9 Concepts Ml M2 M3 L Debt Nontransaction 10 In M2 5 11 In M3 only 6 components Time and savings deposits Commercial banks Savings, iqcluding MMDAs Small time Large time 8 , 9 Thrift institutions 15 Savings, including MMDAs 16 Small time 17 Large time 8 ' 12 13 14 Money market mutual funds IK General purpose and broker-dealer 19 Institution-only Debt components4 20 21 Nonfederal Q3 Q4 r 14.8r 15.3r 14.6r 7.8 9.3 9.9 8.4 10.5 25.8 25.3 27.1 12.6 9.3 8.7 9.5 9.1 22.2 23.4 23.2 10.4 12.0 9.6 11.6 10.2 6.9 4.7 6.0 8.3 5.6 9.3 8.3 8.5 5.4 3.0 4.4 8.9 10.6 .3 r -,6r 1.3r 5.7 r 11.7 .8 .1 1.1 4.9 r 16.8 2.7 -.2 1.9 4.4 6.5 -2.1 -4.0 n.a. n.a. 15.7 2.3 -.4 3.2 5.7 8.8 -.3 -3.4 -.9 6.2 7.7 -3.5 -7.5 -5.2 3.2 -.5 -4.4 -2.3 -1.1 4.4 2.4 -.8 -1.5 n.a. n.a. and Nov. Dec. Jan. r Feb. Mar. debt4 -3.4r -4.9 -3.2 -3.6 -2.8 -14.4 -5.5 -13.7 -3.2 -13.9 -4.1 -19.2 -8.1 -28.3 -6.2 9.2 -2.2 -4.7 12.6 -13.4 -13.3 10.9 -17.4 -18.6 12.9 -17.1 -18.4 1.7 -7.5 -17.3 10.3 -18.5 -16.2 5.7 -11.5 -10.7 -3.2 -9.9 -26.9 2.7 3.1 -10.6 -2.5 -2.9 -18.8 18.1 -29.8 -31.9 9.2 -18.6 -14.9 8.7 -21.7 -11.3 .0 -19.2 -17.3 9.9 -21.3 -29.1 5.6 -21.7 -21.0 1.1 -16.5 -3.6 -10.0 -24.1 -28.6 -4.5 -12.6 -18.3 -6.6r 23.9 -7.4r 32.9 -4.2 -19.4 -10.1 -14.3 -9.0 -9.7 -4.9 -39.6 -9.5 -27.3 -21.2 25.5 -1.8 -8.3 14.4 2.8 r 10.7r 2.9 r 6.0 3.8 n.a. n.a. 10.5 4.0 16.3 2.7 2.9 3.4 5.3 4.0 1. Unless otherwise noted, rates of change are calculated from average amounts outstanding during preceding month or quarter. 2. Figures incorporate adjustments for discontinuities, or "breaks," associated with regulatory changes in reserve requirements. (See also table 1.20.) 3. Seasonally adjusted, break-adjusted monetary base consists of (1) seasonally adjusted, break-adjusted total reserves (line 1), plus (2) the seasonally adjusted currency component of the money stock, plus (3) (for all quarterly reporters on the "Report of Transaction Accounts, Other Deposits, and Vault Cash" and for all weekly reporters whose vault cash exceeds their required reserves) the seasonally adjusted, break-adjusted difference between current vault cash and the amount applied to satisfy current reserve requirements. 4. Composition of the money stock measures and debt is as follows: M l : (1) currency outside the Treasury, Federal Reserve Banks, and the vaults of depository institutions; (2) travelers checks of nonbank issuers; (3) demand deposits at all commercial banks other than those due to depository institutions, the U . S . government, and foreign banks and official institutions, less cash items in the process of collection and Federal Reserve float; and (4) other checkable deposits (OCDs), consisting of negotiable order of withdrawal (NOW) and automatic transfer service (ATS) accounts at depository institutions, credit union share draft accounts, and demand deposits at thrift institutions. Seasonally adjusted Ml is computed by summing currency, travelers checks, demand deposits, and OCDs, each seasonally adjusted separately. M2: Ml plus (1) overnight (and continuing-contract) repurchase agreements (RPs) issued by all depository institutions and overnight Eurodollars issued to U.S. residents by foreign branches of U . S . banks worldwide, (2) savings (including MMDAs) and small time deposits (time deposits—including retail repurchase agreements (RPs)—in amounts of less than $100,000), and (3) balances in both taxable and tax-exempt general-purpose and broker-dealer money market funds. Excludes individual retirement accounts (IRAs) and Keogh balances at depository institutions and money market funds. Also excludes afl balances held by U.S. commercial banks, money market funds (general purpose and broker-dealer), foreign governments and commercial banks, and the U.S. government. Seasonally adjusted M2 is computed by adjusting its non-Mi component as a whole and then adding this result to seasonally adjusted M l . M3: M2 plus (1) large time deposits and term RP liabilities (in amounts of $100,000 or more) issued by all depository institutions, (2) term Eurodollars held by U.S. residents at foreign branches of U.S. banks worldwide and at all banking Ql 2 institutions of money, liquid assets, Q2 n.a. n.a. offices in the United Kingdom and Canada, and (3) balances in both taxable and tax-exempt, institution-only money market funds. Excludes amounts held by depository institutions, the U.S. government, money market funds, and foreign banks and official institutions. Also excluded is the estimated amount of overnight RPs and Eurodollars held by institution-only money market funds. Seasonally adjusted M3 is computed by adjusting its non-M2 component as a whole and then adding this result to seasonally adjusted M2. L: M3 plus the nonbank public holdings of U.S. savings bonds, short-term Treasury securities, commercial paper, and bankers acceptances, net of money market fund holdings of these assets. Seasonally adjusted L is computed by summing U.S. savings bonds, short-term Treasury securities, commercial paper, and bankers acceptances, each seasonally adjusted separately, and then adding this result to M3. Debt: Debt of domestic nonfinancial sectors consists of outstanding creditmarket debt of the U . S . government, state and local governments, and private nonfinancial sectors. Private debt consists of corporate bonds, mortgages, consumer credit (including bank loans), other bank loans, commercial paper, bankers acceptances, and other debt instruments. Data are derived from the Federal Reserve Board's flow of funds accounts. Data on debt of domestic nonfinancial sectors are monthly averages, derived by averaging adjacent month-end levels. Growth rates for debt reflect adjustments for discontinuities over time in the levels of debt presented in other tables. 5. Sum of (1) overnight RPs and Eurodollars, (2) money market fund balances (general purpose and broker-dealer), (3) MMDAs, and (4) savings and small time deposits. 6. Sum of (1) large time deposits, (2) term RPs, (3) term Eurodollars of U . S . residents, and (4) money market fund balances (institution-only), less (5) a consolidation adjustment that represents the estimated amount of overnight RPs and Eurodollars held by institution-only money market funds. This sum is seasonally adjusted as a whole. 7. Small time deposits—including retail RPs—are those issued in amounts of less than $100,000. All IRA and Keogh account balances at commercial banks and thrift institutions are subtracted from small time deposits. 8. Large time deposits are those issued in amounts of $100,000 or more, excluding those booked at international banking facilities. 9. Large time deposits at commercial banks less those held by money market funds, depository institutions, and foreign banks and official institutions. Money Stock and Bank Credit 1.11 A5 R E S E R V E S OF DEPOSITORY INSTITUTIONS A N D RESERVE B A N K C R E D I T 1 Millions of dollars Jan. Average of daily figures Average of daily figures for week ending on date indicated 1993 1993 Feb. Mar. Feb. 17 Feb. 24 Mar. 3 Mar. 10 Mar. 17 Mar. 24 Mar. 31 SUPPLYING RESERVE F U N D S 1 Reserve Bank credit outstanding U.S. government securities 2 Bought outright—System account 3 Held under repurchase agreements . . . Federal agency obligations 4 Bought outright 5 Held under repurchase agreements . . . 6 Acceptances Loans to depository institutions 7 Adjustment credit 8 Seasonal credit 9 Extended credit 10 Float 11 Other Federal Reserve assets 336,822 r 334,937 337,717 334,964 333,563 337,914 336,092 337,877 336,699 339,624 297,541 2,582 297,289 1,358 298,823 1,984 297,127 1,008 298,136 0 297,420 4,178 297,661 2,327 298,672 1,628 300,087 0 299,897 2,213 5,379 189 0 5,271 73 0 5,173 112 0 5,260 64 0 5,260 0 0 5,225 252 0 5,216 202 0 5,165 37 0 5,165 0 0 5,123 164 0 182 10 1 l,025 r 29,913 22 18 0 763 30,143 69 26 0 1,188 30,342 14 19 0 1,110 30,362 24 22 0 997 29,123 48 18 0 974 29,799 6 19 0 718 29,944 137 25 0 2,237 29,977 13 31 0 777 30,626 120 32 0 1,018 31,057 12 Gold stock 13 Special drawing rights certificate account . 14 Treasury currency outstanding 11,055 8,018 21,470 r 11,055 8,018 21,510 11,055 8,018 21,560 11,055 8,018 21,509 11,055 8,018 21,518 11,055 8,018 21,528 11,055 8,018 21,542 11,055 8,018 21,556 11,055 8,018 21,570 11,054 8,018 21,584 330,334 r 505 329,470 467 331,650 509 330,480 464 330,217 463 329,941 470 331,101 512 331,893 512 332,044 512 332,174 512 7,693 215 6,018 243 5,472 290 4,791 240 4,967 237 6,017 254 5,395 202 5,563 375 5,026 238 5,243 370 6,426 r 285 6,289 302 6,501 347 6,170 305 6,180 306 6,413 327 6,535 344 6,304 344 6,296 334 6,905 362 8,523 9,006 9,091 8,925 8,928 9,130 9,113 9,093 9,064 9,069 24,423 23,828 25,644 Mar. 17 Mar. 24 Mar. 31 ABSORBING R E S E R V E F U N D S 15 Currency in circulation 16 Treasury cash holdings Deposits, other than reserve balances, with Federal Reserve Banks 17 Treasury 18 Foreign 19 Service-related balances and adjustments 20 Other 21 Other Federal Reserve liabilities and capital 22 Reserve balances with Federal Reserve Banks 3 23,386 r 23,724 24,490 24,171 22,856 Feb. 23,506 Wednesday figures End-of-month figures Jan. 25,964 Mar. Feb. 17 Feb. 24 Mar. 3 Mar. 10 S U P P L Y I N G RESERVE F U N D S 1 Reserve Bank credit outstanding U.S. government securities 2 Bought outright—System account 3 Held under repurchase agreements . . . Federal agency obligations 4 Bought outright 5 Held under repurchase agreements . . . 6 Acceptances Loans to depository institutions 7 Adjustment credit 8 Seasonal credit 9 Extended credit 10 Float 11 Other Federal Reserve assets 12 Gold stock 13 Special drawing rights certificate account . 14 Treasury currency outstanding 333,077 r 337,550 343,479 336,621 335,258 339,027 333,188 333,908 337,988 343,479 296,977 0 298,835 2,655 298,461 6,756 297,025 2,831 299,778 0 296,079 7,130 297,810 300 297,015 50 299,440 0 298,461 6,756 5,310 0 0 5,225 275 0 5,123 567 0 5,260 150 0 5,260 0 0 5,225 145 0 5,165 107 0 5,165 0 0 5,165 0 0 5,123 567 0 21 10 4 226 r 30,529 40 17 0 663 29,841 720 32 0 380 31,439 17 22 0 1,887 29,430 27 22 0 930 29,241 43 18 0 385 30,003 8 21 0 -14 29,793 894 29 0 771 29,985 16 28 0 2,568 30,771 720 32 380 31,439 11,055 8,018 21,490 r 11,055 8,018 21,528 11,054 8,018 21,584 11,055 8,018 21,509 11,055 8,018 21,518 11,055 8,018 21,528 11,055 8,018 21,542 11,055 8,018 21,556 11,055 8,018 21,570 11,054 8,618 21,584 326,573 r 508 329,621 463 332,829 515 330,984 463 329,924 463 330,4% 512 331,657 512 332,121 512 332,032 512 332,829 515 9,572 244 5,350 296 6,752 318 4,869 256 4,973 232 7,640 224 5,242 230 6,930 707 5,216 288 6,752 318 6,004 r 282 6,413 302 6,905 314 6,170 324 6,180 282 6,413 351 6,535 347 6,304 352 6,2% 327 6,905 314 9,141 9,180 8,844 8,773 8,817 8,982 8,863 8,922 8,953 8,844 20,418 18,687 25,007 27,660 e ABSORBING RESERVE F U N D S 15 Currency in circulation 16 Treasury cash holdings Deposits, other than reserve balances, with Federal Reserve Banks 17 Treasury 18 Foreign 19 Service-related balances and adjustments 20 Other 21 Other Federal Reserve liabilities and capital 22 Reserve balances with Federal Reserve Banks 21,315 r 26,526 27,660 1. For amounts of cash held as reserves, see table 1.12. 2. Includes securities loaned—fully guaranteed by U.S. government securities pledged with Federal Reserve Banks—and excludes any securities sold and scheduled to be bought back under matched sale-purchase transactions. 25,365 24,978 25,010 3. Excludes required clearing balances and adjustments to compensate for float, A6 DomesticNonfinancialStatistics • June 1993 1.12 R E S E R V E S A N D BORROWINGS Depository Institutions 1 Millions of dollars Prorated monthly averages of biweekly averages Reserve classification 1 2 3 4 5 6 7 8 9 10 Reserve balances with Reserve Banks Total vault cash 3 Applied vault cash 4 , Surplus vault cash Total reserves 6 Required reserves Excess reserve balances at R e s e w e Banks Total borrowings at Reserve Banks Seasonal borrowings Extended credit 9 ... 1990 1991 1992 Dec. Dec. Dec. Sept. Oct. Nov. Dec. Jan. r Feb. Mar. 30,237 31,789 r 28,884 2,905 r 59,120 57,456 1,664 326 76 23 26,659 32,510 28,872 3,638 55,532 54,553 979 192 38 1 25,368 34,535 31,172 3,364 56,540 55,385 1,155 124 18 1 22,627 32,342 28,894 3,448 51,521 50,527 994 287 193 0 23,626 32,987 29,510 3,477 53,136 52,062 1,074 143 114 0 25,462 32,457 29,205 3,252 54,666 53,624 1,043 104 40 0 25,368 34,535 31,172 3,364 56,540 55,385 1,155 124 18 1 23,636 35,991 32,368 3,623 56,004 54,744 1,260 165 11 1 23,515 33,914 30,368 3,546 53,882 52,778 1,104 45 18 0 24,384 33,293 29,913 3,380 54,297 53,084 1,214 91 26 0 1992 1993 Biweekly averages of daily figures for weeks ending 1992 1 2 3 4 5 6 7 8 9 10 Reserve balances with Reserve Banks Total vault cash 3 Applied vault cash 4 , Surplus vault cash 5 Total reserves Required reserves Excess reserve balances at Reserve Banks Total borrowings at Reserve Banks 8 Seasonal borrowings Extended credit 9 ... ... 1993 Nov. 25 Dec. 9 Dec. 23 Jan. 6 Jan. 20 Feb. 3 r Feb. 17 Mar. 3 Mar. 17 Mar. 31 25,730 32,398 29,117 3,281 54,846 53,485 1,361 138 37 0 24,548 34,315 30,918 3,397 55,466 54,625 841 95 22 0 25,209 34,770 31,373 3,397 56,582 55,357 1,225 60 19 2 26,569 34,374 31,105 3,269 57,674 56,289 1,385 269 12 0 24,057 36,388 r 32,829 3,559 r 56,886 55,657 1,229 202 11 1 21,500 36,368 32,470 3,898 53,970 52,740 1,230 64 11 3 23,301 34,764 31,069 3,695 54,370 52,875 1,495 33 18 0 24,335 32,163 28,902 3,261 53,237 52,666 571 56 20 0 24,029 34,487 30,944 3,543 54,973 53,683 1,290 93 22 0 24,750 32,343 29,099 3,244 53,849 52,574 1,275 98 32 0 1. Data in this table also appear in the Board's H.3 (502) weekly statistical release. For ordering address, see inside front cover. 2. Excludes required clearing balances and adjustments to compensate for float and includes other off-balance-sheet "as-of" adjustments. 3. Total "lagged" vault cash held by depository institutions subject to reserve requirements. Dates refer to the maintenance periods during which the vault cash can be used to satisfy reserve requirements. Under contemporaneous reserve requirements, maintenance periods end thirty days after the lagged computation periods during which the balances are held. 4. All vault cash held during the lagged computation period by "bound" institutions (that is, those whose required reserves exceed their vault cash) plus the amount of vault cash applied during the maintenance period by "nonbound" institutions (that is, those whose vault cash exceeds their required reserves) to satisfy current reserve requirements. 5. Total vault cash (line 2) less applied vault cash (line 3). 6. Reserve balances with Federal Reserve Banks (line 1) plus applied vault cash (line 3). 7. Total reserves (line 5) less required reserves (line 6). 8. Also includes adjustment credit. 9. Consists of borrowing at the discount window under the terms and conditions established for the extended credit program to help depository institutions deal with sustained liquidity pressures. Because there is not the same need to repay such borrowing promptly as there is with traditional short-term adjustment credit, the money market impact of extended credit is similar to that of nonborrowed reserves. Money Stock and Bank Credit 1.13 S E L E C T E D BORROWINGS IN IMMEDIATELY A V A I L A B L E F U N D S A7 Large Banks 1 Millions of dollars, averages of daily figures 1992, week ending Monday Source and maturity 1 2 3 4 5 6 7 8 Federal funds purchased, repurchase agreements, and other selected borrowings From commercial banks in the United States For one day or under continuing contract For all other maturities From other depository institutions, foreign banks and official institutions, and U.S. government agencies For one day or under continuing contract For all other maturities Repurchase agreements on U.S. government agency securities Brokers and nonbank dealers in securities For one day or under continuing contract For all other maturities All other customers For one day or under continuing contract For all other maturities and 1993, week ending Monday Dec. 28 Jan. 4 Jan. 11 Jan. 18 Jan. 25 Feb. 1 Feb. 8 Feb. 15 Feb. 22 71,828 13,825 74,152 14,797 75,358 13,384 71,974 13,895 66,898 13,456 69,127 14,029 71,676 13,669 70,934 14,049 69,724 13,622 20,597 18,783 19,060 16,955 20,531 17,419 20,277 17,441 19,888 17,469 17,824 17,841 17,465 18,837 17,264 21,448 20,090 21,375 10,237 18,341r 9,686 18,588 11,117 18,592 8,554 18,933 10,218 18,994 10,857 19,447 9,270 20,935 10,038 22,955 13,355 21,937 22,808 14,151 23,596 13,605 23,582 13,567 23,673 13,755 24,379 13,344 24,283 13,866 23,927 12,655 22,917 13,304 24,806 13,440 37,991 18,270 41,340 20,812 37,458 18,322 37,316 22,669 37,614 19,362 41,221 18,469 39,000 21,417 39,517 21,233 38,715 18,716 federal MEMO Federal funds loans and resale agreements in immediately available funds in maturities of one day or under continuing contract 9 To commercial banks in the United States 10 To all other specified customers 2 1. Banks with assets of $4 billion or more as of Dec. 31, 1988. Data in this table also appear in the Board's H.5 (507) weekly statistical release. For ordering address, see inside front cover. 2. Brokers and nonbank dealers in securities, other depository institutions, foreign banks and official institutions, and U.S. government agencies. A8 1.14 DomesticNonfinancialStatistics • June 1993 FEDERAL RESERVE B A N K INTEREST RATES Percent per year Current and previous levels Seasonal credit 2 Adjustment credit 1 Federal Reserve Bank Boston N e w York Philadelphia Cleveland Richmond Atlanta On 4/30/93 Effective date Previous rate On 4/30/93 7/2/92 7/2/92 7/2/92 7/6/92 7/2/92 7/2/92 3.5 3.00 3 , Chicago St. Louis Minneapolis Kansas City Dallas San Francisco . . . 7/2/92 7/7/92 7/2/92 7/2/92 7/2/92 7/2/92 3 3.5 3.00 Extended credit 3 Effective date Previous rate On 4/30/93 4/29/93 4/29/93 4/29/93 4/29/93 4/29/93 4/29/93 3.05 3.50 4/29/93 4/29/93 4/29/93 4/29/93 4/29/93 4/29/93 3.05 3.50 Effective date Previous rate 4/29/93 4/29/93 4/29/93 4/29/93 4/29/93 4/29/93 3.55 4/29/93 4/29/93 4/29/93 4/29/93 4/29/93 4/29/93 3.55 Range of rates for adjustment credit in recent years 4 Effective date In effect Dec. 31, 1977 1978—Jan. May July Aug. Sept. Oct. Nov. 9 20 11 12 3 10 21 22 16 20 1 3 1979—July 20 Aug. 17 20 Sept. 19 21 Oct. 8 10 1980—Feb. May June July Sept. Nov. Dec. 15 19 29 30 13 16 29 28 26 17 5 Range (or level)— All F.R. Banks 6 6-6.5 6.5 6.5-7 7 7-7.25 7.25 7.75 8 8-8.5 8.5 8.5-9.5 9.5 10 10-10.5 10.5 10.5-11 11 11-12 12 12-13 13 12-13 12 11-12 11 10 10-11 11 12 12-13 F.R. Bank of N.Y. 6 6.5 6.5 7 7 7.25 7.25 7.75 8 8.5 8.5 9.5 9.5 10 10.5 10.5 11 11 12 12 13 13 13 12 11 11 10 10 11 12 13 Effective 1981-—May 5 Nov. ? 6 4 Dec. 13-14 14 13-14 13 12 F.R. Bank of N.Y. 5.5 5.5 1987—Sept. 4 11 5.5-6 6 6 6 1988—Aug. 9 11 6-6.5 6.5 1989—Feb. 24 27 6.5-7 7 7 7 9 13 Nov. 71 76 Dec. 74 8.5-9 9 8.5-9 8.5 8 9 9 8.5 8.5 8 1985-—May 70 74 7.5-8 7.5 7.5 7.5 7 10 Apr. 71 July 11 7-7.5 7 6.5-7 6 7 7 6.5 6 1990—Dec. 19 1991—Feb. Apr. May Sept. Sept. Nov. Dec. 1992—July 1 4 30 2 13 17 6 7 20 24 2 7 In effect Apr. 30, 1993 1986-—Mar. F.R. Bank of N.Y. 5.5-6 5.5 11.5 11.5 11 11 10.5 10 10 9.5 9.5 9 9 9 8.5 8.5 1984-—Apr. Range (or level)— All F.R. Banks 1986—Aug. 21 22 11.5-12 11.5 11-11.5 11 10.5 10-10.5 10 9.5-10 9.5 9-9.5 9 8.5-9 8.5-9 8.5 Aug. Effective date 14 14 13 13 12 70 7\ ? 3 16 77 30 Oct. 17 13 Nov. 77 76 Dec. 14 15 17 1982-- J u l y 1. Available on a short-term basis to help depository institutions meet temporary needs for funds that cannot be met through reasonable alternative sources. The highest rate established for loans to depository institutions may be charged on adjustment-credit loans of unusual size that result from a major operating problem at the borrower's facility. 2. Available to help relatively small depository institutions meet regular seasonal needs for funds that arise from a clear pattern of intrayearly movements in their deposits and loans and that cannot be met through special industry lenders. The discount rate on seasonal credit takes into account rates on market sources of funds and ordinarily is reestablished on the first business day of each two-week reserve maintenance period; however, it is never less than the discount rate applicable to adjustment credit. 3. May be made available to depository institutions when similar assistance is not reasonably available from other sources, including special industry lenders. Such credit may be provided when exceptional circumstances (including sustained deposit drains, impaired access to money market funds, or sudden deterioration in loan repayment performance) or practices involve only a particular institution, or to meet the needs of institutions experiencing difficulties adjusting to changing market conditions over a longer period (particularly at times of deposit disintermediation). The discount rate applicable to adjustment credit Range (or level)— All F:R. Banks 6.5 6.5 6-6.5 6 5.5-6 5.5 5-5.5 5 4.5-5 4.5 3.5-4.5 3.5 6 6 5.5 5.5 5 5 4.5 4.5 3.5 3.5 3-3.5 3 3 3 3 3 ordinarily is charged on extended-credit loans outstanding less than thirty days; however, at the discretion of the Federal Reserve Bank, this time period may be shortened. Beyond this initial period, a flexible rate somewhat above rates on market sources of funds is charged. The rate ordinarily is reestablished on the first business day of each two-week reserve maintenance period, but it is never less than the discount rate applicable to adjustment credit plus 50 basis points. 4. For earlier data, see the following publications of the Board of Governors: Banking and Monetary Statistics, 1914-1941, and 1941-1970\ and the Annual Statistical Digest, 1970-1979. In 1980 and 1981, the Federal Reserve applied a surcharge to short-term adjustment-credit borrowings by institutions with deposits of $500 million or more that had borrowed in successive weeks or in more than four weeks in a calendar quarter. A 3 percent surcharge was in effect from Mar. 17, 1980, through May 7, 1980. A surcharge of 2 percent was reimposed on N o v . 17, 1980; the surcharge was subsequently raised to 3 percent on D e c . 5, 1980, and to 4 percent on May 5, 1981. The surcharge was reduced to 3 percent effective Sept. 22, 1981, and to 2 percent effective Oct. 12, 1981. As of Oct. 1, 1981, the formula for applying the surcharge was changed from a calendar quarter to a moving thirteen-week period. The surcharge was eliminated on Nov. 17, 1981. Policy Instruments 1.15 A9 RESERVE REQUIREMENTS OF DEPOSITORY INSTITUTIONS 1 Type of deposit 2 Net transaction accounts3 $0 miilion-$46.8 million... More than $46.8 million 4 .. 12/15/92 12/15/92 3 Nonpersonal time deposits' 12/27/90 4 Eurocurrency liabilities 6 . . 12/27/90 1 2 1. Required reserves must be held in the form of deposits with Federal Reserve Banks or vault cash. Nonmember institutions may maintain reserve balances with a Federal Reserve Bank indirectly on a pass-through basis with certain approved institutions. For previous reserve requirements, see earlier editions of the Annual Report or the Federal Reserve Bulletin. Under provisions of the Monetary Control Act, depository institutions include commercial banks, mutual savings banks, savings and loan associations, credit unions, agencies and branches of foreign banks, and Edge corporations. 2. The Garn-St Germain Depository Institutions Act of 1982 (Public Law 97-320) requires that $2 million of reservable liabilities of each depository institution be subject to a zero percent reserve requirement. The Board is to adjust the amount of reservable liabilities subject to this zero percent reserve requirement each year for the succeeding calendar year by 80 percent of the percentage increase in the total reservable liabilities of all depository institutions, measured on an annual basis as of June 30. N o corresponding adjustment is to be made in the event of a decrease. On Dec. 15, 1992, the exemption was raised from $3.6 million to $3.8 million. The exemption applies in the following order: (1) net negotiable order of withdrawal (NOW) accounts (NOW accounts less allowable deductions); and (2) net other transaction accounts. The exemption applies only to accounts that would be subject to a 3 percent reserve requirement. 3. Include all deposits against which the account holder is permitted to make withdrawals by negotiable or transferable instruments, payment orders of withdrawal, and telephone and preauthorized transfers in excess of three per month for the purpose of making payments to third persons or others. However, money market deposit accounts (MMDAs) and similar accounts subject to the rules that permit no more than six preauthorized, automatic, or other transfers per month, of which no more than three may be checks, are not transaction accounts (such accounts are savings deposits). The Monetary Control Act of 1980 requires that the amount of transaction accounts against which the 3 percent reserve requirement applies be modified annually by 80 percent of the percentage change in transaction accounts held by all depository institutions, determined as of June 30 each year. Effective Dec. 15, 1992, for institutions reporting quarterly, and Dec. 24, 1992, for institutions reporting weekly, the amount was increased from $42.2 million to $46.8 million. 4. The reserve requirement was reduced from 12 percent to 10 percent on Apr. 2, 1992, for institutions that report weekly, and on Apr. 16, 1992, for institutions that report quarterly. 5. For institutions that report weekly, the reserve requirement on nonpersonal time deposits with an original maturity of less than 1 Vi years was reduced from 3 percent to 116 percent for the maintenance period that began Dec. 13, 1990, and to zero for the maintenance period that began Dec. 27, 1990. The reserve requirement on nonpersonal time deposits with an original maturity of 1 Vi years or more has been zero since Oct. 6, 1983. For institutions that report quarterly, the reserve requirement on nonpersonal time deposits with an original maturity of less than 1 Vi years was reduced from 3 percent to zero on Jan. 17, 1991. 6. The reserve requirement on Eurocurrency liabilities was reduced from 3 percent to zero in the same manner and on the same dates as were the reserve requirement on nonpersonal time deposits with an original maturity of less than 1 Vi years (see note 4). A10 1.17 DomesticNonfinancialStatistics • June 1993 F E D E R A L R E S E R V E OPEN MARKET TRANSACTIONS 1 Millions of dollars 1993 1992 Type of transaction 1990 1992 1991 Aug. Sept. Oct. Nov. Dec. Jan. Feb. U . S . TREASURY SECURITIES Outright transactions transactions) (excluding matched Treasury bills Gross purchases Gross sales Exchanges 4 Redemptions 24,739 7,291 241,086 4,400 20,158 120 277,314 1,000 14,714 1,628 308,699 1,600 271 0 25,041 0 595 0 22,277 0 4,072 0 28,907 0 1,064 0 25,468 0 3,669 0 29,562 0 0 0 24,542 0 0 0 19,832 0 Others within one year Gross purchases Gross sales Maturity shifts Exchanges Redemptions 425 0 25,638 -27,424 0 3,043 0 24,454 -28,090 1,000 1,0% 0 36,662 -30,543 0 0 0 4,448 -4,617 0 350 0 2,753 -1,905 0 0 0 2,010 -982 0 461 0 7,160 -4,615 0 0 0 2,777 -1,570 0 0 0 561 -1,202 0 0 0 2,892 -6,044 0 10 11 1? 13 One to five years Gross purchases Gross sales Maturity shifts Exchanges 250 200 -21,770 25,410 6,583 0 -21,211 24,594 13,118 0 -34,478 25,811 400 0 -4,036 3,567 3,500 0 -2,753 1,905 200 0 -1,762 884 4,172 0 -6,800 3,415 200 0 -2,777 1,570 0 0 -64 882 0 0 -2,617 4,564 14 15 16 17 Five to ten years Gross purchases Gross sales Maturity shifts Exchanges 0 100 -2,186 789 1,280 0 -2,037 2,894 2,818 0 -1,915 3,532 195 0 -412 700 750 0 0 0 0 0 -248 97 1,176 0 -187 800 100 0 0 0 0 0 -497 0 0 0 -98 0 18 19 20 21 More than ten years Gross purchases Gross sales Maturity shifts Exchanges 0 0 -1,681 1,226 375 0 -1,209 600 2,333 0 -269 1,200 0 0 0 350 731 0 0 0 0 0 0 0 947 0 -173 400 0 0 0 0 0 0 0 0 0 0 -177 480 22 23 24 AH maturities Gross purchases Gross sales Redemptions 25,414 7,591 4,400 31,439 120 1,000 34,079 1,628 1,600 866 0 0 5,927 0 0 4,272 0 0 7,820 0 0 3,969 0 0 0 0 0 0 0 0 ?<I 26 Matched transactions Gross sales Gross purchases 1,369,052 1,363,434 1,570,456 1,571,534 1,482,467 1,480,140 103,708 101,410 116,331 115,579 116,024 114,917 115,020 117,020 144,232 142,578 114,543 116,510 111,491 113,349 27 28 Repurchase agreements2 Gross purchases Gross sales 219,632 202,551 310,084 311,752 378,374 386,257 39,484 31,868 68,697 59,628 18,698 35,383 42,373 39,117 48,904 44,697 34,768 42,231 28,544 25,889 29 Net change in U.S. government securities 24.886 29,729 20,642 6,184 14,244 -13,520 13,075 6,521 -5,497 4,513 0 0 183 0 5 292 0 0 632 0 0 54 0 0 37 0 0 0 0 0 0 0 0 121 0 0 103 0 0 85 41,836 40,461 22,807 23,595 14,565 14,486 601 548 3,222 1,800 1,778 3,253 2,760 2,506 1,601 1,224 2,237 2,868 1,107 832 -1 1,385 -1,475 254 256 -734 190 15,629 -14,995 13,329 6,777 -6,231 4,703 1 2 5 6 7 8 9 F E D E R A L A G E N C Y OBLIGATIONS 30 31 32 Outright transactions Gross purchases Gross sales Redemptions 33 34 Repurchase agreements2 Gross purchases Gross sales 35 Net change in federal agency obligations 1,192 -1,085 -554 36 Total net change in System Open Market Account 26,078 28,644 20,089 1. Sales, redemptions, and negative figures reduce holdings of the System Open Market Account; all other figures increase such holdings. 6,183 2. In July 1984 the Open Market Trading Desk discontinued accepting bankers acceptances in repurchase agreements. Federal Reserve Banks 1.18 FEDERAL RESERVE BANKS All Condition and Federal Reserve Note Statements 1 Millions of dollars Account Mar. 3 Mar. 10 Wednesday End of month 1993 1993 Mar. 17 Mar. 24 Mar. 31 Jan. 31 Feb. 28 Mar. 31 Consolidated condition statement ASSETS 1 Gold certificate account 2 Special drawing rights certificate account 3 Coin Loans 4 To depository institutions 5 Other 6 Acceptances held under repurchase agreements Federal agency obligations 1 Bought outright 8 Held under repurchase agreements 9 Total U.S. Treasury securities 2 11,055 8,018 527 11,055 8,018 524 11,055 8,018 519 11,055 8,018 516 11,054 8,018 503 11,055 8,018 519 11,055 8,018 525 11,054 8,018 503 61 0 0 28 0 0 922 0 0 44 0 0 753 0 0 35 0 0 57 0 0 753 0 0 5,225 145 5,165 107 5,165 0 5,165 0 5,123 567 5,310 0 5,225 275 5,123 567 303,209 298,110 297,065 299,440 305,217 296,977 301,490 305,217 299,440 143,083 120,211 36,146 0 298,461 142,104 120,211 36,146 6,756 296,977 143,761 118,179 35,037 0 298,835 145,618 117,955 35,261 2,655 298,461 142,104 120,211 36,146 6,756 10 Bought outright 11 Bills 12 Notes 13 Bonds 14 Held under repurchase agreements 296,079 142,862 117,955 35,261 7,130 297,810 144,593 117,955 35,261 300 297,015 143,799 117,955 35,261 50 15 Total loans and securities 308,639 303,410 303,152 304,649 311,660 302,321 307,046 311,660 6,914 1,027 5,020 1,027 6,129 1,029 7,148 1,030 5,338 1,031 4,565 1,026 4,937 1,026 5,338 1,031 22,276 6,708 22,301 6,497 22,326 6,636 22,384 7,361 22,328 8,092 21,980 7,572 22,263 6,577 22,328 8,092 365,165 357,852 358,864 362,161 368,024 357,057 361,446 368,024 16 Items in process of collection 17 Bank premises Other assets 18 Denominated in foreign currencies 3 19 All other 4 20 Total assets LIABILITIES 310,007 311,151 311,596 311,490 312,263 306,110 309,080 312,263 22 Total deposits 40,460 33,190 33,577 37,113 41,917 37,632 39,034 41,917 23 24 25 26 32,246 7,640 224 351 27,373 5,242 230 347 25,587 6,930 707 352 31,282 5,216 288 327 34,533 6,752 318 314 27,533 9,572 244 282 33,085 5,350 296 302 34,533 6,752 318 314 5,716 2,290 4,648 2,254 4,769 2,303 4,605 2,268 5,001 2,251 4,174 2,288 4,152 2,323 5,001 2,251 358,473 351,243 352,245 355,476 361,430 350,204 354,589 361,430 3,118 3,054 520 3,155 3,054 400 3,159 3,054 406 3,179 3,054 452 3,187 3,054 353 3,074 2,974 806 3,116 3,054 687 3,187 3,054 353 365,165 357,852 358,864 362,161 368,024 357,057 361,446 368,024 303,372 304,117 301,803 302,617 304,825 297,501 306,378 304,825 21 Federal Reserve notes Depository institutions U.S. Treasury—General account Foreign—Official accounts Other 27 Deferred credit items 28 Other liabilities and accrued dividends 29 Total liabilities CAPITAL ACCOUNTS 30 Capital paid in 31 Surplus 32 Other capital accounts 33 Total liabilities and capital accounts MEMO 34 Marketable U.S. Treasury securities held in custody for foreign and international accounts Federal Reserve note statement 35 Federal Reserve notes outstanding (issued to Bank) 36 LESS: Held by Federal Reserve Bank 37 Federal Reserve notes, net 38 39 40 41 Collateral held against notes, net: Gold certificate account Special drawing rights certificate account Other eligible assets U.S. Treasury and agency securities 42 Total collateral 371,135 61,128 310,007 372,175 61,024 311,151 372,940 61,344 311,596 373,719 62,230 311,490 373,886 61,624 312,263 366,486 60,376 306,110 370,756 61,676 309,080 373,886 61,624 312,263 11,055 8,018 0 290,934 11,055 8,018 0 292,078 11,055 8,018 0 292,524 11,055 8,018 0 292,417 11,054 8,018 0 293,190 11,055 8,018 0 287,037 11,055 8,018 0 290,007 11,054 8,018 0 293,190 310,007 311,151 311,596 311,490 312,263 306,110 309,080 312,263 1. Some of the data in this table also appear in the Board's H.4.1 (503) weekly statistical release. For ordering address, see inside front cover. 2. Includes securities loaned—fully guaranteed by U.S. Treasury securities pledged with Federal Reserve Banks—and excludes securities sold and scheduled to be bought back under matched sale-purchase transactions. 3. Valued monthly at market exchange rates. 4. Includes special investment account at the Federal Reserve Bank of Chicago in Treasury bills maturing within ninety days. 5. Includes exchange-translation account reflecting the monthly revaluation at market exchange rates of foreign exchange commitments. A12 1.19 DomesticNonfinancialStatistics • June 1993 FEDERAL RESERVE BANKS Maturity Distribution of Loan and Security Holding 1 Millions of dollars T y p e and maturity grouping Wednesday End of month 1993 1993 Mar. 17 Mar. 3 Mar. 24 Mar. 31 1 Total loans 922 753 2 3 4 920 3 741 12 Within fifteen d a y s Sixteen days to ninety days . N i n e t y - o n e d a y s to o n e year 0 Jan. 31 Feb. 28 0 5 Total acceptances 6 7 8 9 Total U.S. Treasury securities.. 303,209 0 0 0 0 0 0 0 0 0 Within fifteen d a y s Sixteen days to ninety d a y s . Ninety-one d a y s to o n e year 298,110 297,065 299,440 305,217 296,977 301,490 13,740 67,760 96,590 72,194 20,344 28,813 17,889 67,037 99,880 71,255 20,344 28,813 9,160 74,289 98,311 68,686 18,726 27,805 13,331 72,699 97,433 70,291 19,628 28,108 Within fifteen days Sixteen days t o ninety d a y s . Ninety-one days to o n e year O n e year t o five years F i v e years to ten years More than ten years 19,048 68,921 96.752 70.753 19,628 28,108 12,941 73,270 93,411 70,753 19,628 28,108 11,416 70,650 96,511 70,753 19,628 28,108 16 Total federal agency obligations 5,370 5,272 5,165 5,164 5,690 5,310 5,500 Within fifteen d a y s 2 Sixteen days to ninety d a y s . N i n e t y - o n e days to o n e year One year t o five years F i v e years to ten years More than ten years 255 789 1,094 2,379 711 142 148 748 1,094 2,379 761 142 271 543 1,069 2,429 711 142 271 543 1,069 2,429 711 142 855 507 1,057 2,419 711 142 183 840 1,023 2,426 696 142 723 513 1,022 2,389 711 142 10 11 12 13 14 15 17 18 19 20 21 22 2 1. Holdings under repurchase agreements are classified as maturing within fifteen days in accordance with m a x i m u m maturity of the agreements. Monetary and Credit Aggregates 1.20 A13 A G G R E G A T E R E S E R V E S OF DEPOSITORY INSTITUTIONS A N D M O N E T A R Y B A S E 1 Billions of dollars, averages of daily figures 1992r Item 1989 Dec. 1990 Dec. Aug. Total reserves 3 Nonborrowed reserves Nonborrowed reserves plus extended credit Required reserves Monetary base Sept. Oct. Nov. Dec. Jan. Feb. Mar. 53.82 53.71 53.71 52.77 347.83 54.35 54.23 54.23 53.20 350.80 54.67 r 54.50 r 54.50" 53.41 r 353.22 r 54.92 54.88 54.88 53.82 355.74 55.17 55.08 55.08 53.95 358.38 Seasonally adjusted A D J U S T E D FOR C H A N G E S IN RESERVE R E Q U I R E M E N T S 2 1 2 3 4 5 1993 1992 Dec/ 1991 Dec. 45.53 r 40.49 1 41.77 r 41.44 r 40.23 r 45.34 r r r 40.25 41.46 45.34 r 39.57 r 40.10 1 44.56 r r 267.73 293.19" 317.17 r 54.35 54.23 54.23 53.20 350.80 50.34 50.09 50.09 49.41 336.84 51.27 50.99 50.99 50.28 341.59 52.84 52.69 52.69 51.76 344.85 Not seasonally adjusted 6 7 8 9 10 Total reserves 7 Nonborrowed reserves Nonborrowed reserves plus extended credit Required reserves 8 Monetary base 41.77 41.51 41.53 40.85 271.18 43.07 42.74 42.77 41.40 296.68 46.98 46.78 46.78 46.00 321.07 56.06 55.93 55.93 54.90 354.55 49.78 49.53 49.53 48.84 336.57 51.07 50.78 50.78 50.08 340.08 52.62 52.47 52.47 51.54 343.63 54.08 53.97 53.97 53.04 347.89 56.06 55.93 55.93 54.90 354.55 55.97 55.80 55.80 54.71 354.41R 53.81 53.77 53.77 52.71 353.18 54.18 54.09 54.09 52.97 356.00 62.81 62.54 62.56 61.89 292.55 .92 .27 59.12 58.80 58.82 57.46 313.70 1.66 .33 55.53 55.34 55.34 54.55 333.61 .98 .19 56.54 56.42 56.42 55.39 360.90 1.16 .12 50.16 49.91 49.91 49.23 342.49 .94 .25 51.52 51.23 51.23 50.53 346.21 .99 .29 53.14 52.99 52.99 52.06 349.81 1.07 .14 54.67 54.56 54.56 53.62 354.25 1.04 .10 56.54 56.42 56.42 55.39 360.90 1.16 .12 56.00 55.84 55.84 54.74R 360.88R 1.26 .17 53.88 53.84 53.84 52.78 359.56 1.10 .05 54.30 54.21 54.21 53.08 362.59 1.21 .09 N O T A D J U S T E D FOR C H A N G E S IN RESERVE R E Q U I R E M E N T S 1 0 11 12 N 14 15 16 17 Total reserves" Nonborrowed reserves Nonborrowed reserves plus extended credit Required reserves Monetary base Excess reserves Borrowings from the Federal Reserve 1. Latest monthly and biweekly figures are available from the Board's H.3 (502) weekly statistical release. Historical data and estimates of the impact on required reserves of changes in reserve requirements are available from the Monetary and Reserves Projections Section, Division of Monetary Affairs, Board of Governors of the Federal Reserve System, Washington, DC 20551. 2. Figures reflect adjustments for discontinuities, or "breaks," associated with regulatory changes in reserve requirements. (See also table 1.10) 3. Seasonally adjusted, break-adjusted total reserves equal seasonally adjusted, break-adjusted required reserves (line 4) plus excess reserves (line 16). 4. Seasonally adjusted, break-adjusted nonborrowed reserves equal seasonally adjusted, break-adjusted total reserves (line 1) less total borrowings of depository institutions from the Federal Reserve (line 17). 5. Extended credit consists of borrowing at the discount window under the terms and conditions established for the extended credit program to help depository institutions deal with sustained liquidity pressures. Because there is not the same need to repay such borrowing promptly as there is with traditional short-term adjustment credit, the money market impact of extended credit is similar to that of nonborrowed reserves. 6. The seasonally adjusted, break-adjusted monetary base consists of (1) seasonally adjusted, break-adjusted total reserves (line 1), plus (2) the seasonally adjusted currency component of the money stock, plus (3) (for all quarterly reporters on the "Report of Transaction Accounts, Other Deposits and Vault Cash" and for all those weekly reporters whose vault cash exceeds their required reserves) the seasonally adjusted, break-adjusted difference between current vault cash and the amount applied to satisfy current reserve requirements. 7. Break-adjusted total reserves equal break-adjusted required reserves (line 9) plus excess reserves (line 16). 8. To adjust required reserves for discontinuities that are due to regulatory changes in reserve requirements, a multiplicative procedure is used to estimate what required reserves would have been in past periods had current reserve requirements been in effect. Break-adjusted required reserves include required reserves against transactions deposits and nonpersonal time and savings deposits (but not reservable nondeposit liabilities). 9. The break-adjusted monetary base equals (1) break-adjusted total reserves (line 6), plus (2) the (unadjusted) currency component of the money stock, plus (3) (for all quarterly reporters on the "Report of Transaction Accounts, Other Deposits and Vault Cash" and for all weekly reporters whose vault cash exceeds their required reserves) the break-adjusted difference between current vault cash and the amount applied to satisfy current reserve requirements. 10. Reflects actual reserve requirements, including those on nondeposit liabilities, with no adjustments to eliminate the effects of discontinuities associated with changes in reserve requirements. 11. Reserve balances with Federal Reserve Banks plus vault cash used to satisfy reserve requirements. 12. The monetary base, not break-adjusted and not seasonally adjusted, consists of (1) total reserves (line 11), plus (2) required clearing balances and adjustments to compensate for float at Federal Reserve Banks, plus (3) the currency component of the money stock, plus (4) (for all quarterly reporters on the "Report of Transaction Accounts, Other Deposits and Vault Cash" and for all those weekly reporters whose vault cash exceeds their required reserves) the difference between current vault cash and the amount applied to satisfy current reserve requirements. Since the introduction of changes in reserve requirements (CRR), currency and vault cash figures have been measured over the computation periods ending on Mondays. 13. Unadjusted total reserves (line 11) less unadjusted required reserves (line 14). A14 1.21 DomesticNonfinancialStatistics • June 1993 M O N E Y STOCK, L I Q U I D ASSETS, A N D D E B T M E A S U R E S 1 Billions of dollars, averages of daily figures 1992 1989 Dec/ Item 1990 Dec. r 1991 Dec. 1993 1992 Dec. r Dec. r Jan. r Feb. Mar. Seasonally adjusted 1 2 3 4 5 Measures2 Ml M2 M3 L Debt 6 7 8 9 Ml components Currency Travelers checks 4 Demand deposits 5 Other checkable deposits 6 794.6 3,233.3 4,056.1 4,886.1 10,076.7 827.2 3,345.5 4,116.7 4,965.2 10,751.3 899.3 3,445.8 4,168.1 4,982.2 ll,192.7 r 1,026.6 3,497.0 4,166.5 5,051.4 11,768.2 1,026.6 3,497.0 4,166.5 5,051.4 11,768.2 1,033.2 3,486.9 4,140.6 5,029.4 11,800.0 1,032.8 3,474.0 4,132.7 5,024.8 11,843.0 1,034.9 3,471.7 4,127.7 n.a. n.a. 222.7 6.9 279.8 285.3 246.7 7.8 278.2 294.5 267.2 7.8 290.5 333.8 292.3 8.1 340.9 385.2 292.3 8.1 340.9 385.2 294.8 8.0 341.9 388.5 296.9 8.0 341.9 386.1 299.0 8.0 341.9 386.0 2,438.7 822.8 2,518.3 771.2 2,546.6 722.3 2,470.4 669.5 2,470.4 669.5 2,453.8 653.7 2,441.2 658.7 2,436.7 656.1 Commercial banks 12 Savings deposits, including MMDAs 13 Small time deposits 14 Large time deposits 1 0 , 11 541.4 534.9 387.7 582.2 610.3 368.7 666.2 601.5 341.3 756.1 507.0 290.2 756.1 507.0 290.2 754.1 502.8 283.7 755.8 504.1 281.2 754.2 502.9 276.8 Thrift institutions 15 Savings deposits, including MMDAs 16 Small time deposits 17 Large time deposits 1 0 349.6 617.8 161.1 338.6 562.0 120.9 376.3 463.2 83.4 429.9 363.2 67.3 429.9 363.2 67.3 430.3 358.2 67.1 426.7 351.0 65.5 425.1 347.3 64.5 Money market mutual funds 18 General purpose and broker-dealer 19 Institution-only 317.4 108.8 350.5 135.9 363.9 182.1 342.3 202.3 342.3 202.3 339.6 197.7 333.6 201.9 333.1 200.5 2,249.5 7,827.2 2,493.4 8,257.9 2,764.8 8,428.0 r 3,068.8 8,699.4 3,068.8 8,699.4 3,076.3 8,723.7 3,090.0 8,753.0 Nontrgnsaction 10 In M2 7 11 In M3 8 components Debt components 20 Federal debt 21 Nonfederal debt n.a. n.a. Not seasonally adjusted 22 23 24 25 26 Measures Ml M2 M3 L Debt 27 28 29 30 Ml components Currency 3 , Travelers checks Demand deposits 5 Other checkable deposits 811.5 3,245.1 4,066.4 4,906.0 10,063.6 843.7 3,357.0 4,126.3 4,986.5 10,739.9 916.4 3,457.9 4.178.1 5.004.2 ll,182.8 r 1,045.7 3.511.2 4,178.5 5.076.3 11,760.6 1,045.7 3.511.2 4,178.5 5.076.3 11,760.6 1.040.1 3,492.7 4.143.2 5.046.3 11,787.2 1,022.0 3.468.0 4.130.1 5,025.1 11,811.8 1.030.4 3.478.5 4,137.7 n.a. n.a. 225.3 6.5 291.5 288.1 249.5 7.4 289.9 296.9 269.9 7.4 302.9 336.3 295.0 7.8 355.3 387.7 295.0 7.8 355.3 387.7 293.6 7.8 346.2 392.6 295.3 7.7 334.3 384.6 297.9 7.8 336.3 388.5 2,433.6 821.4 2,513.2 769.3 2,541.5 720.1 2,465.4 667.3 2,465.4 667.3 2,452.6 650.5 2,446.0 662.1 2,448.1 659.2 Commercial banks 33 Savings deposits, including MMDAs 34 Small time deposits 35 Large time deposits 10 ' 11 543.0 533.8 386.9 580.1 610.5 367.7 663.3 602.0 340.1 752.3 507.8 289.1 752.3 507.8 289.1 749.5 504.6 281.7 753.1 504.8 280.8 757.7 502.3 277.7 Thrift institutions 36 Savings deposits, including MMDAs 37 Small time deposits 38 Large time deposits 1 0 347.4 616.2 162.0 337.3 562.1 120.6 374.7 463.6 83.1 427.8 363.8 67.1 427.8 363.8 67.1 427.7 359.4 66.6 425.2 351.4 65.4 427.1 346.9 64.7 Money market mutual funds 39 General purpose and broker-dealer 40 Institution-only 315.7 109.1 348.4 136.2 361.5 182.4 340.0 202.4 340.0 202.4 339.2 202.3 339.8 210.3 342.2 203.2 Repurchase 41 Overnight 42 Term 77.5 178.4 74.7 158.3 76.3 130.1 73.9 126.2 73.9 126.2 72.3 123.0 71.6 127.6 71.9 133.5 2,247.5 7,816.2 2,491.3 8,248.5 3,069.8 8,690.8 3,069.8 8,690.8 3,076.2 8,711.1 3.087.3 8.724.4 Nontrgnsaction 31 I n M 2 7 32 In M3 8 components agreements and Debt components 43 Federal debt 44 Nonfederal debt For notes see following page. eurodollars 2,765.0 8,417.9" n.a. n.a. Monetary and Credit Aggregates A15 NOTES TO TABLE 1.21 1. Latest monthly and weekly figures are available from the Board's H.6 (508) weekly statistical release. Historical data are available from the Money and Reserves Projection Section, Division of Monetary Affairs, Board of Governors of the Federal Reserve System, Washington, DC 20551. 2. Composition of the money stock measures and debt is as follows: Ml: (1) currency outside the Treasury, Federal Reserve Banks, and the vaults of depository institutions; (2) travelers checks of nonbank issuers; (3) demand deposits at all commercial banks other than those due to depository institutions, the U.S. government, and foreign banks and official institutions, less cash items in the process of collection and Federal Reserve float; and (4), other checkable deposits (OCDs), consisting of negotiable order of withdrawal (NOW) and automatic transfer service (ATS) accounts at depository institutions, credit union share draft accounts, and demand deposits at thrift institutions. Seasonally adjusted Ml is computed by summing currency, travelers checks, demand deposits, and OCDs, each seasonally adjusted separately. M2: Ml plus (1) overnight (and continuing-contract) repurchase agreements (RPs) issued by all depository institutions and overnight Eurodollars issued to U.S. residents by foreign branches of U.S. banks worldwide, (2) savings (including MMDAs) and small time deposits (time deposits—including retail RPs—in amounts of less than $100,000), and (3) balances in both taxable and tax-exempt general purpose and broker-dealer money market funds. Excludes individual retirement accounts (IRAs) and Keogh balances at depository institutions and money market funds. Also excludes all balances held by U.S. commercial banks, money market funds (general purpose and broker-dealer), foreign governments and commercial banks, and the U.S. government. Seasonally adjusted M2 is computed by adjusting its non-Mi component as a whole and then adding this result to seasonally adjusted M l . M3: M2 plus (1) large time deposits and term RP liabilities (in amounts of $100,000 or more) issued by all depository institutions, (2) term Eurodollars held by U . S . residents at foreign branches of U.S. banks worldwide and at ail banking offices in the United Kingdom and Canada, and (3) balances in both taxable and tax-exempt, institution-only money market funds. Excludes amounts held by depository institutions, the U.S. government, money market funds, and foreign banks and official institutions. Also excluded is the estimated amount of overnight RPs and Eurodollars held by institution-only money market funds. Seasonally adjusted M3 is computed by adjusting its non-M2 component as a whole and then adding this result to seasonally adjusted M2. L: M3 plus the nonbank public holdings of U.S. savings bonds, short-term Treasury securities, commercial paper, and bankers acceptances, net of money market fund holdings of these assets. Seasonally adjusted L is computed by summing U.S. savings bonds, short-term Treasury securities, commercial paper, and bankers acceptances, each seasonally adjusted separately, and then adding this result to M3. Debt: Debt of domestic nonfinancial sectors consists of outstanding credit market debt of the U.S. government, state and local governments, and private nonfinancial sectors. Private debt consists of corporate bonds, mortgages, consumer credit (including bank loans), other bank loans, commercial paper, bankers acceptances, and other debt instruments. Data are derived from the Federal Reserve Board's flow of funds accounts. Debt data are based on monthly averages. This sum is seasonally adjusted as a whole. 3. Currency outside the U . S . Treasury, Federal Reserve Banks, and vaults of depository institutions. 4. Outstanding amount of U . S . dollar-denominated travelers checks of nonbank issuers. Travelers checks issued by depository institutions are included in demand deposits. 5. Demand deposits at commercial banks and foreign-related institutions other than those owed to depository institutions, the U.S. government, and foreign banks and official institutions, less cash items in the process of collection and Federal Reserve float. 6. Consists of NOW and ATS account balances at all depository institutions, credit union share draft account balances, and demand deposits at thrift institutions. 7. Sum of (1) overnight RPs and overnight Eurodollars, (2) money market fund balances (general purpose and broker-dealer), (3) MMDAs, and (4) savings and small time deposits. 8. Sum of (1) large time deposits, (2) term RPs, (3) term Eurodollars of U.S. residents, and (4) money market fund balances (institution-only), less a consolidation adjustment that represents the estimated amount of overnight RPs and Eurodollars held by institution-only money market funds. 9. Small time deposits—including retail RPs—are those issued in amounts of less than $100,000. All IRAs and Keogh accounts at commercial banks and thrift institutions are subtracted from small time deposits. 10. Large time deposits are those issued in amounts of $100,000 or more, excluding those booked at international banking facilities. 11. Large time deposits at commercial banks less those held by money market funds, depository institutions, and foreign banks and official institutions. A16 1.22 DomesticNonfinancialStatistics • June 1993 B A N K DEBITS A N D DEPOSIT T U R N O V E R 1 Debits are in billions of dollars; turnover is ratio of debits to deposits; monthly data are at annual rates 1992 1993 Bank group, or type of customer Sept. Aug. 4 Other checkable deposits 4 5 Savings deposits including MMDAs 5 Nov. r Dec. Jan. Seasonally adjusted D E B I T S TO Demand deposits3 1 All insured banks 2 Major N e w York City banks 3 Other banks Oct. r 277,157.5 131,699.1 145,458.4 277,758.0 137,352.3 140,405.7 315,806.1 165,572.7 150,233.5 306,923.0 157,221.1 149,702.0 346,658.3 184,740.9 161,917.4 326,893.0 176,372.6 150,520.4 322,187.1 173,393.4 148,793.7 331,038.8 176,089.1 154,949.8 300,484.5 159,069.5 141,415.0 3,349.0 3,483.3 3,645.5 3,266.1 3,788.1 3,331.3 3,763.9 3,139.8 3,942.1 3,559.1 3,700.5 3,468.2 3,610.0 3,497.2 3,683.9 3,407.3 3,311.3 3,054.9 797.8 3,819.8 464.9 803.5 4,270.8 447.9 832.4 4,797.9 435.9 800.0 4,550.9 428.8 892.4 5,254.5 458.3 818.9 4,855.5 414.8 796.1 4,624.0 405.2 830.5 4,693.3 429.1 748.1 4,151.2 389.2 16.5 6.2 16.2 5.3 14.4 4.7 14.2 4.4 14.7 4.9 13.5 4.7 12.9 4.7 13.1 4.6 11.6 4.1 DEPOSIT T U R N O V E R Demand deposits3 6 All insured banks 7 Major N e w York City banks 8 Other banks 9 Other checkable deposits 4 10 Savings deposits including MMDAs Not seasonally adjusted D E B I T S TO Demand deposits3 11 All insured banks 12 Major N e w York City banks 13 Other banks 14 Other checkable deposits 4 15 Savings deposits including MMDAs 277,290.5 131,784.7 145,505.8 277,715.4 137,307.2 140,408.3 315,808.2 165,595.0 150,213.3 315,724.4 162,973.3 152,751.0 334,831.5 178,998.2 155,833.4 335,289.0 182,584.2 152,704.8 308,015.6 167,578.4 140,437.2 340,982.1 179,987.6 160,994.5 304,640.9 159,075.0 145,565.9 3,346.7 3,483.0 3,645.6 3,267.7 3,788.1 3,329.0 3,696.9 3,173.5 3,945.7 3,374.3 3,689.7 3,403.2 3,351.3 3,240.4 3,849.3 3,588.0 3,616.8 3,273.0 798.2 3,825.9 465.0 803.4 4,274.3 447.9 832.5 4,803.5 436.0 836.5 4,870.2 444.1 864.2 5,180.1 441.6 839.2 5,025.6 420.5 754.3 4,494.4 378.5 815.2 4,418.1 426.5 739.7 3,933.2 392.0 16.4 6.2 16.2 5.3 14.4 4.7 14.1 4.4 14.9 4.6 13.7 4.6 12.1 4.4 13.5 4.8 12.5 4.4 DEPOSIT T U R N O V E R Demand deposits3 16 All insured banks 17 Major N e w York City banks 18 Other banks 19 Other checkable deposits 4 20 Savings deposits including MMDAs 1. Historical tables containing revised data for earlier periods can be obtained from the Banking and Money Market Statistics Section, Division of Monetary Affairs, Board of Governors of the Federal Reserve System, Washington, DC 20551. Data in this table also appear on the Board's G.6 (406) monthly statistical release. For ordering address, see inside front cover. 2. Annual averages of monthly figures. 3. Represents accounts of individuals, partnerships, and corporations and of states and political subdivisions. 4. Accounts authorized for negotiable orders of withdrawal (NOWs) and accounts authorized for automatic transfer to demand deposits (ATSs). 5. Money market deposit accounts. Commercial Banking Institutions 1.23 L O A N S A N D SECURITIES A17 All Commercial Banks 1 Billions of dollars, averages of Wednesday figures 1993 1992 Item Apr. May July June Aug. Sept. r Oct. r Nov. r Dec. r Jan. r Feb. Mar. Seasonally adjusted 1 Total loans and securities 1 7 U.S. government securities 3 Other securities 4 Total loans and leases Commercial and industrial . . . . . Bankers acceptances held . . . 6 7 Other commercial and industrial 8 U.S. addressees 3 9 Non-U.S. addressees 3 10 Real estate 11 Individual 12 Security 13 Nonbank financial institutions 14 Agricultural 15 State and political subdivisions 16 Foreign banks 17 Foreign official institutions 18 Lease-financing receivables . . . . 19 All other loans 2,874.3 2,875.3 2,882.8 2,886.9 2,902.2 2,918.2 2,930.2 2,937.4 2,943.7 2,939.8 2,944.5 2,958.0 590.8 178.5 2,104.9 609.0 6.5 600.2 176.9 2,098.2 607.6 6.7 610.7 175.8 2,096.2 604.6 6.3 619.2 177.9 2,089.8 602.5 6.5 632.6 178.2 2,091.4 601.4 6.5 640.8 178.4 2,099.0 601.1 6.3 648.7 179.5 2,101.9 600.9 7.4 653.4 177.7 2,106.2 601.3 7.6 659.8 176.4 2,107.5 599.0 7.1 659.9 174.2 2,105.6 600.2 6.9 670.5 175.6 2,098.4 598.3 8.2 685.1 177.6 2,095.3 594.2 8.4 602.6 593.2 9.4 881.8 360.8 63.4 600.9 590.8 10.1 883.3 359.2 60.9 598.4 588.3 10.1 881.8 359.0 63.3 596.0 585.3 10.7 881.5 358.6 60.5 594.9 584.3 10.6 883.1 357.4 61.6 594.8 583.5 11.3 887.1 357.1 64.0 593.5 582.4 11.1 892.3 356.1 64.7 593.7 582.4 11.3 893.9 355.7 64.3 591.9 580.8 11.1 893.9 355.7 65.0 593.2 581.9 11.4 890.4 358.2 63.2 590.1 578.6 11.5 888.6 360.2 61.9 585.8 573.9 11.9 888.9 360.7 62.8 43.2 34.3 43.3 34.3 42.4 34.6 41.5 34.9 42.0 35.3 44.1 35.2 44.2 35.1 45.1 35.1 44.1 34.8 45.5 34.4 45.3 34.3 45.0 34.2 27.6 6.7 2.0 31.1 45.1 27.3 7.0 2.0 30.9 42.4 26.8 7.5 2.0 31.0 43.3 26.2 7.7 2.2 30.8 43.2 25.9 7.2 2.3 30.8 44.3 25.8 7.9 2.5 31.0 43.1 25.4 7.3 2.4 30.7 42.8 25.2 7.0 2.8 30.6 45.3 24.8 7.0 2.9 30.6 49.9 24.3 6.9 2.9 30.0 49.7 23.7 7.7 3.1 29.9 n.a. 23.5 7.3 3.0 29.9 n.a. Not seasonally adjusted 20 Total loans and securities 1 2,875.8 2,870.7 2,882.9 2,876.1 2,894.5 2,915.7 2,929.4 2,944.0 2,953.5 2,941.9 2,947.4 2,961.8 21 U.S. government securities 7? Other securities 73 Total loans and leases 74 Commercial and industrial . . . . . 25 Bankers acceptances held . . . 7,6 Other commercial and industrial 77 U . S . addressees 3 78 Non-U.S. addressees 3 79 Real estate 30 Individual 31 Security 3? Nonbank financial institutions Agricultural 33 State and political 34 subdivisions 35 Foreign banks 36 Foreign official institutions Lease-financing receivables . . . . 37 38 All other loans 592.6 178.0 2,105.2 612.1 6.3 599.4 176.5 2,094.8 609.4 6.6 608.9 175.4 2,098.7 606.5 6.2 615.3 176.8 2,084.0 601.5 6.3 631.3 178.1 2,085.0 597.6 6.3 638.9 178.1 2,098.7 597.5 6.2 646.5 179.8 2,103.0 598.5 7.2 656.1 178.8 2,109.1 601.5 7.8 658.5 176.6 2,118.4 602.0 7.4 660.3 174.8 2,106.7 598.6 7.1 674.1 175.8 2,097.5 597.5 8.5 690.9 177.3 2,093.7 597.4 8.5 605.8 596.3 9.5 880.7 358.1 66.9 602.7 592.7 10.0 883.4 357.4 58.4 600.3 589.5 10.8 882.0 357.2 63.5 595.2 584.2 11.0 881.6 356.4 58.0 591.4 580.5 10.8 883.7 356.9 59.4 591.3 580.2 11.1 887.9 358.7 62.5 591.3 580.5 10.8 893.0 356.5 64.2 593.7 583.0 10.7 895.4 356.5 63.6 594.6 583.6 11.0 895.2 360.1 65.7 591.5 580.2 11.3 890.2 362.3 64.7 588.9 577.4 11.6 886.8 360.2 64.9 588.9 577.2 11.8 886.3 358.2 64.8 42.6 33.5 42.8 34.0 42.9 35.1 41.3 35.8 41.8 36.5 43.6 36.6 43.8 36.0 45.4 35.1 46.1 34.6 45.7 33.6 45.2 33.0 44.6 32.9 27.6 6.4 2.0 31.2 44.1 27.3 6.8 2.0 30.9 42.5 26.8 7.3 2.0 31.0 44.4 26.1 7.8 2.2 30.6 42.6 25.9 7.0 2.3 30.6 43.2 25.9 8.0 2.5 30.8 44.5 25.5 7.6 2.4 30.6 44.6 25.2 7.3 2.8 30.5 45.7 24.8 7.4 2.9 30.5 49.1 24.1 6.9 2.9 30.3 47.5 23.6 7.5 3.1 30.2 n.a. 23.5 7.0 3.0 30.1 n.a. 1. Adjusted to exclude loans to commercial banks in the United States. 2. Includes nonfinancial commercial paper held. 3. United States includes the fifty states and the District of Columbia. A18 1.24 DomesticNonfinancialStatistics • June 1993 MAJOR N O N D E P O S I T F U N D S OF COMMERCIAL B A N K S 1 Billions of dollars, monthly averages 1992 1993 Source of funds Apr. May June July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Seasonally adjusted 1 Total nondeposit funds 2 — 2 Net balances due to related foreign offices . . . 3 Borrowings from other than commercial banks in United States 4 4 Domestically chartered banks 5 Foreign-related banks 291.9 50.9 292.4 53.7 295.9 61.2 297.0 61.7 302.4 61.4 309.4 r 64.0 304.9 1 63.8 r 309. l r 67.9" 312.9 71.1 312.9 r 74. r 312.3 73.3 323.9 80.0 241.0 154.6 86.5 238.7 151.8 86.9 234.7 147.6 87.2 235.3 147.2 88.1 241.1 151.5 89.6 245.4 r 153.4 92. l r 241.1 154.5 86.6 241.2 153.7 87.5 241.8 r 154.3 87.4 238.8 155.1 83.7 239.0 156.1 82.9 243.9 161.1 82.8 Not seasonally adjusted 6 Total nondeposit funds 7 Net balances due to related foreign offices . . . 8 Domestically chartered banks 9 Foreign-related banks 10 Borrowings from other than commercial banks in United States 11 Domestically chartered banks 12 Federal funds and security RP borrowings 13 Other 6 14 Foreign-related banks 6 72.6 307.2 r 65.0" -13.4r 78.3 r 314.3 r 69.6 r -12.6r 82. l r 312.7 75.2 -15.1 90.3 311.8 76.7 -15.9 92.6 316.6 75.1 -10.6 85.7 328.8 80.7 -7.0 87.8 242.3 r 152.2 242.3 155.7 244.8 158.1 237.5 153.4 235.1 152.1 241.5 157.8 248.0 164.0 146.5 3.9 89.5 148.4 3.8 90. r 152.1 3.6 86.6 154.0 4.1 86.6 149.4 4.0 84.1 148.4 3.6 83.0 154.5 3.2 83.7 n.a. n.a. 84.0 387.7 387.4 385.8 387.1 383.2 383.6 375.7 374.9 371.3 371.1 366.6 365.5 359.9" 358.0 1 358.4 358.0 355.7 356.6 23.1 19.6 28.0 22.4 24.1 28.6 21.5 21.9 20.7 16.5 20.4 19.5 25.6 33.l r 23.6 29.5 18.8 17.3 288.4 47.9 -4.6 52.6 297.1 55.9 -4.5 60.4 295.2 59.2 -6.3 65.6 291.5 58.4 -7.0 65.4 297.5 57.6 -9.3 66.9 -11.0 240.5 152.7 241.2 153.3 236.0 147.4 233.1 144.1 239.9 150.4 149.2 3.4 87.8 149.4 3.9 87.9 143.3 4.1 88.6 139.9 4.2 89.0 401.5 400.5 397.5 399.4 393.3 394.9 20.8 17.7 19.2 21.0 24.7 25.2 304.0" 61.6 MEMO Gross large time deposits 15 Seasonally adjusted 16 Not seasonally adjusted U.S. Treasury demand balances commercial banks 17 Seasonally adjusted 18 Not seasonally adjusted at 1. Commercial banks are nationally and state-chartered banks in the fifty states and the District of Columbia, agencies and branches of foreign banks, N e w York investment companies majority owned by foreign banks, and Edge Act corporations owned by domestically chartered and foreign banks. Data in this table also appear in the Board's G.10 (411) release. For ordering address, see inside front cover. 2. Includes federal funds, repurchase agreements (RPs), and other borrowing from nonbanks and net balances due to related foreign offices. 3. Reflects net positions of U . S . chartered banks, Edge Act corporations, and U . S . branches and agencies of foreign banks with related foreign offices plus net positions with own International Banking Facilities (IBFs). 4. Borrowings through any instrument, such as a promissory note or due bill, given for the purpose of borrowing money for the banking business. This includes borrowings from Federal Reserve Banks and from foreign banks, term federal funds, loan RPs, and sales of participations in pooled loans. 5. Figures are based on averages of daily data reported weekly by approximately 120 large banks and quarterly or annual data reported by other banks. 6. Figures are partly averages of daily data and partly averages of Wednesday data. 7. Time deposits in denominations of $100,000 or more. Estimated averages of daily data. 8. U.S. Treasury demand deposits and Treasury tax and loan notes at commercial banks. Averages of daily data. Commercial Banking Institutions 1.25 A S S E T S A N D LIABILITIES OF COMMERCIAL B A N K S 1 Wednesday figures Millions of dollars 1993 Account Mar. 24 Feb. 3 Feb. 10 Feb. 17 Feb. 24 Mar. 3 Mar. 10 3,118,497 809,779 648,632 161,147 38,214 24,484 2,359 11,372 2,270,504 165,927 2,104,577 601,125 887,582 73,081 814,501 361,281 254,588 210,622 32,591 29,340 29,694 78,029 40,366 289,163 3,101,583 807,871 646,996 160,875 37,268 23,426 2,747 11,095 2,256,444 157,585 2,098,860 596,882 888,769 73,066 815,703 360,843 252,367 195,806 23,825 30,913 27,810 71,524 41,307 287,081 3,107,865 808,337 646,885 161,452 40,623 25,915 2,617 12,091 2,258,906 162,766 2,096,139 597,554 886,139 73,064 813,074 360,069 252,378 227,314 28,745 32,630 33,517 91,596 40,232 282,083 3,085,402 813,306 651,254 162,052 37,014 22,989 2,217 11,808 2,235,082 145,781 2,089,302 595,478 884,179 73,060 811,119 359,614 250,031 199,105 27,888 32,474 28,746 69,239 40,292 281,425 3,132,722 820,520 657,933 162,587 39,280 24,254 2,109 12,917 2,272,922 169,158 2,103,764 599,000 887,717 73,516 814,201 358,413 258,635 210,519 28,655 29,708 30,533 81,013 40,032 290,299 3,120,772 824,462 661,035 163,428 39,929 25,886 2,199 11,843 2,256,381 162,802 2,093,579 596,470 888,194 73,472 814,722 357,595 251,320 195,068 24,017 30,973 28,282 70,767 40,452 287,240 3,131,520 828,667 666,417 162,250 41,232 26,785 2,284 12,162 2,261,622 160,438 2,101,184 599,488 885,691 73,473 812,218 358,081 257,925 199,599 21,818 30,940 29,443 75,241 41,580 280,677 3,101,833 830,804 667,899 162,905 37,743 23,408 2,427 11,908 2,233,286 145,064 2,088,223 5%,290 884,738 73,473 811,265 357,791 249,404 197,328 27,982 31,483 28,633 68,500 40,730 283,052 3,618,283 3,584,470 3,617,262 3,565,933 3,633,540 3,603,079 3,611,796 3,582,213 2,490,711 745,285 4,190 39,279 701,816 745,372 636,553 363,500 512,214 36,822 475,392 340,395 2,478,784 731,402 3,092 36,591 691,719 749,492 634,889 363,001 494,457 31,599 462,858 335,259 2,503,772 758,882 3,482 45,159 710,240 750,326 633,433 361,131 504,864 21,749 483,115 332,448 2,462,605 718,645 3,645 36,419 678,581 746,203 633,159 364,598 487,072 16,048 471,024 338,454 2,503,169 754,761 3,388 38,867 712,506 750,723 636,033 361,652 505,450 5,636 499,814 345,622 2,482,906 734,576 2,967 35,623 695,987 754,157 635,233 358,940 495,543 8,032 487,511 344,869 2,482,159 739,186 2,884 38,026 698,276 752,182 633,494 357,297 507,327 21,073 486,254 342,690 2,462,845 725,248 3,252 36,618 685,378 749,917 631,915 355,764 492,766 15,814 476,952 347,348 3,343,320 3,308,500 3,341,083 3,288,130 3,354,241 3,323,317 3,332,176 3,302,959 274,963 275,970 276,180 277,802 279,298 279,762 279,620 279,254 A L L COMMERCIAL B A N K I N G I N S T I T U T I O N S 2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Assets L o a n s and securities Investment securities U . S . government securities Other Trading account assets U . S . government securities Other securities ." Other trading account assets Total loans Interbank loans L o a n s excluding interbank Commercial and industrial Real estate Revolving h o m e equity Other Individual All other Total c a s h assets Balances with Federal Reserve Banks Cash in vault D e m a n d balances at U . S . depository institutions Cash items Other cash assets Other assets 25 Total assets 26 27 28 29 30 31 32 33 34 35 36 37 Liabilities Total deposits Transaction accounts Demand, U . S . government D e m a n d , depository institutions Other demand and all checkable deposits Savings deposits (excluding checkable) Small time deposits Time deposits o v e r $100,000 Borrowings Treasury tax and loan notes Other Other liabilities 38 Total liabilities 39 Residual (assets l e s s liabilities) 3 F o o t n o t e s appear o n the following page. A19 A20 1.25 DomesticNonfinancialStatistics • June 1993 A S S E T S A N D LIABILITIES OF COMMERCIAL B A N K S 1 Wednesday figures—Continued Miftk>ns of dollars 1993 Account Feb. 3 Feb. 10 Feb. 17 Feb. 24 Mar. 3 Mar. 10 Mar. 17 Mar. 24 Mar. 31 Assets 40 Loans and securities 41 Investment securities 42 U.S. government securities 43 Other 44 Trading account assets 45 U.S. government securities 46 Other securities 47 Other trading account assets 4S Total loans 49 Interbank loans 56 Loans excluding interbank 51 Commercial and industrial 52 Real estate 53 Revolving home equity 54 Other 55 Individual 56 All other 57 Total cash assets 58 Balances with Federal Reserve Banks 59 Cash in vawlt 68 Demand balances at U.S. depository institutions 61 Cash items 62 Other cash assets 63 Other assets 2,760,488 743,685 604,437 139,248 38,214 24,484 2,359 11,372 1,978,590 144,615 1,833,975 437,982 835,517 73,081 762,436 361,281 199,194 184,063 31,768 29,307 28,074 76,086 18,226 177,133 2,745,746 743,335 604,389 138,946 37,268 23,426 2,747 11,095 1,965,143 134,598 1,830,545 435,871 836,707 73,066 763,641 360,843 197,124 168,451 23,330 30,880 26,277 68,711 18,827 177,954 2,751,436 741,316 601,850 139,466 40,623 25,915 2,617 12,091 1,969,497 139,173 1,830,324 436,827 834,275 73,064 761,210 360,069 199,153 201,564 27,962 32,592 31,865 89,311 19,240 175,277 2,733,909 745,544 605,669 139,875 37,014 22,989 2,217 11,808 1,951,351 126,340 1,825,011 436,084 832,704 73,060 759,644 359,614 196,610 172,647 27,409 32,440 27,094 66,781 18,457 171,332 2,770,088 751,900 611,858 140,042 39,280 24,254 2,109 12,917 1,978,908 143,398 1,835,511 438,750 836,523 73,516 763,007 358,413 201,825 182,687 27,784 29,675 29,007 78,875 16,769 175,935 2,760,187 754,262 613,870 140,392 39,929 25,886 2,199 11,843 1,965,9% 135,272 1,830,725 437,510 837,252 73,472 763,780 357,595 198,369 168,152 23,516 30,940 26,800 68,466 17,854 173,380 2,769,015 756,955 617,447 139,508 41,232 26,785 2,284 12,162 1,970,829 137,059 1,833,769 438,952 834,378 73,473 760,905 358,081 202,358 171,611 20,885 30,907 27,928 73,073 18,241 171,004 2,745,135 760,059 619,836 140,224 37,743 23,408 2,427 11,908 1,947,333 123,833 1,823,500 436,722 833,614 73.473 760,141 357,791 195,373 169,815 27.474 31,449 27,045 66,095 17,753 171,465 2,762,833 762,295 621,494 140,801 37,326 22,823 2,768 11,735 1,963,212 136,765 1,826,446 439,124 835,440 73,602 761,838 358,951 192,932 182,901 29,232 31,576 26,606 78,439 17,048 181,4% 64 Total assets 3,121,685 3,092,151 3,128,276 3,077,888 3,128,711 3,101,718 3,111,629 3,086,415 3,127,230 Liabilities 65 Total deposits 66 Transaction accounts 67 Demand, U.S. government 68 Demand, depository institutions 69 Other demand and all checkable deposits 70 Savings deposits (excluding checkable) 71 Small time deposits 72 Time deposits over $100,000 73 Borrowings 74 Treasury tax and loan notes 75 Other Other liabilities 76 2,333,422 734,352 4,190 36,780 693,382 740,868 634,106 224,097 385,627 36,822 348,805 131,282 2,321,559 720,103 3,091 34,115 744,965 632,446 224,046 367,429 31,599 335,830 130,800 2,349,717 749,024 3,481 42,856 702,687 745,783 631,003 223,907 376,339 21,749 354,590 129,649 2,303,891 708,348 3,645 34,091 670,612 741,5% 630,742 223,205 366,667 16,048 350,619 133,135 2,346,905 744,186 3,387 36,365 704,434 746,140 633,617 222,%3 369,026 5,636 363,390 137,089 2,329,044 724,536 2,967 33,288 688,281 749,571 632,847 222,091 358,299 8,032 350,267 138,222 2,329,157 728,806 2,884 35,467 690,455 747,786 631,144 221,421 370,290 21,073 349,217 136,169 2,309,667 715,134 3,251 34,361 677,522 745,474 629,574 219,485 365,526 15,814 349,712 135,576 2,334,274 745,441 3,881 32,925 708,635 746,990 628,735 213,108 368,998 14,856 354,142 145,919 77 Total liabilities 2,850,331 2,819,789 2,855,705 2,803,694 2,853,021 2,825,565 2,835,617 2,810,769 2,849,191 271,354 272,362 272,571 274,194 275,690 276,154 276,012 275,646 278,040 DOMESTICALLY C H A R T E R E D COMMERCIAL B A N K S 4 78 Residual (assets less liabilities) 3 682,8% 1. Excludes assets and liabilities of International Banking Facilities. 2. Includes insured domestically chartered commercial banks, agencies and branches of foreign banks, Edge Act and Agreement corporations, and New York State foreign investment corporations. Data are estimates for the last Wednesday of the month based on a sample of weekly reporting foreign-related and domestic institutions and quarter-end condition reports. 3. This balancing item is not intended as a measure of equity capital for use in capital adequacy analysis. 4. Includes all member banks and insured nonmember banks. Loans and securities data are estimates for the last Wednesday of the month based on a sample of weekly reporting banks and quarter-end condition reports. Weekly Reporting Commercial Banks 1.26 A S S E T S A N D LIABILITIES OF L A R G E W E E K L Y REPORTING COMMERCIAL B A N K S Millions of dollars, Wednesday figures 1993 Account Feb. 3 Feb. 10 Feb. 17 Feb. 24 Mar. 3 Mar. 10 Mar. 17 ASSETS 1 Cash and balances due from depository institutions 2 U . S . Treasury and government securities 3 Trading account 4 Investment account Mortgage-backed securities 1 5 All others, by maturity 6 One year or l e s s One year through five years 7 8 More than five years 9 Other securities 10 Trading account 11 Investment account 12 State and political subdivisions, by maturity . 13 One year or l e s s 14 More than o n e year 15 Other bonds, corporate stocks, and securities 16 Other trading account assets 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 Federal funds sold 2 T o commercial banks in the United States T o nonbank brokers and dealers T o others 3 Other loans and leases, gross Commercial and industrial Bankers acceptances and commercial paper . . All other U . S . addressees N o n - U . S . addressees Real estate loans Revolving, h o m e equity All other T o individuals for personal expenditures T o financial institutions Commercial banks in the United States Banks in foreign countries N o n b a n k financial institutions For purchasing and carrying securities T o finance agricultural production T o states and political subdivisions T o foreign governments and official institutions All other loans 4 Lease-financing receivables LESS: Unearned i n c o m e ^ L o a n and lease reserve Other loans and leases, net Other assets 45 Total assets F o o t n o t e s appear o n the following page. 108. 276, 21. 254. 78. 36. 76, 63. 55; 2: 53. 20: 3, 16. 33. 11. 89 61. 22. 5. 982. 278. 2. 276, 274, 1, 398 43 355 185 35 13 1 20. 15 5. 14 1 23 24 2, 36 943 163 1,648,482 97,411 274,967 20.504 254,463 78,659 120,597 277,181 23,109 254,071 78,840 100,834 275,657 20,506 255,151 80,662 105,080 281,664 21,932 259,732 81,194 %,357 282,581 23,026 259,555 81,341 98,%7 285,%2 23,132 262,830 83,447 98,936 284,736 20,521 264,215 83,813 36,852 75,166 63,786 55,862 2,357 53.505 20,262 3,327 16,935 33,243 10,845 36,698 75,459 63,074 56,042 2,009 54,032 20,135 3,250 16,884 33,898 11,839 37,071 75,092 62,326 55,908 1,767 54,141 20,124 3,406 16,718 34,016 11,557 37,827 77,354 63,358 56,199 1,777 54,423 19,986 3,381 16,604 34,437 12,655 37,240 76,150 64,824 56,647 1,860 54,787 20,009 3,378 16,631 34,778 11,586 38,213 76,659 64,511 55,944 1,913 54,031 19,986 3,361 16,625 34,045 11,910 38,894 77,052 64,456 56,575 2,069 54,506 19,995 3,363 16,632 34,511 11,656 78,600 51,875 22,732 3,993 980,124 276,887 3,031 273,856 272,083 1,772 399,407 43,215 356,192 184,631 34,712 12,899 2,151 19,662 16,023 5,485 14,299 1,394 22,867 24,418 2,245 36,866 941,012 164,630 83,946 57,113 22,637 4,196 981,936 278,157 3,030 275,128 273,379 1,749 397,427 43,199 354,227 184,390 35,886 13,438 2,999 19,449 15,199 5,513 14,229 1,556 24,934 24,645 2,271 36,780 942,885 160,047 75,422 48,697 23,229 3,4% 974,476 276,670 2,781 273,889 272,145 1,745 394,603 43,107 351,4% 183,845 33,361 12,522 2,377 18,462 17,160 5,522 14,258 1,486 22,939 24,632 2,253 36,756 935,466 158,5% 89,680 60,491 24,797 4,391 981,342 279,114 2,924 276,190 274,571 1,619 397,443 43,465 353,978 183,753 34,826 12,481 3,306 19,040 5,502 14,221 1,712 24,047 24,658 2,203 37,119 942,021 160,954 80,916 52,051 24,169 4,696 976,948 277,978 2,952 275,025 273,396 1,630 398,035 43,410 354,625 183,288 33,269 12,431 2,233 18,606 15,784 5,500 14,186 1,555 22,821 24,532 2,213 37,038 937,697 159,212 85,559 56,247 24,877 4,435 979,640 278,504 3,141 275,363 273,786 1,577 395,172 43,438 351,734 183,576 34,054 12,860 2,636 18,557 18,135 5,568 14,177 1,463 24,475 24,516 2,201 37,012 940,427 157,300 75,957 47,358 24,460 4,138 970,600 275,852 2,670 273,182 271,632 1,550 394,163 43,400 350,763 183,351 33,325 12,822 2,461 18,041 15,741 5,504 14,145 1,403 22,801 24,315 2,189 36,886 931,525 157,935 1,623,327 1,652,536 1,613,441 1,648,253 1,624,997 1,636,069 1,617,320 16,066 All A22 1.26 DomesticNonfinancialStatistics • June 1993 A S S E T S A N D LIABILITIES OF L A R G E W E E K L Y REPORTING COMMERCIAL BANKS—Continued Millions of dollars, Wednesday figures 1993 Account Feb. 3 Feb. 10 Feb. 17 Feb. 24 Mar. 3 Mar. 10 Mar. 17 Mar. 24 Mar. 31 1,103,346 256,903 206,151 50,752 8,859 1,945 20,839 5,555 618 12,936 116,551 729,891 703,725 26,166 21,440 2,152 2,243 332 1,124,498 278,322 221,986 56,335 9,363 2,073 26,678 6,832 524 10,866 116,588 729,588 703,387 26,201 21,502 2,129 2,241 328 1,091,103 252,959 204,906 48,053 8,936 2,388 21,349 5,243 664 9,473 114,646 723,499 697,665 25,833 21,422 2,051 2,030 330 1,115,967 266,306 216,753 49,553 8,847 2,094 22,182 5,811 556 10,062 121,220 728,441 702,566 25,875 21,415 2,040 2,088 332 1,102,419 255,039 209,670 45,369 8,576 1,835 20,511 4,742 858 8,847 118,168 729,212 703,585 25,627 21,067 2,026 2,203 332 1,105,643 261,756 212,914 48,841 8,759 1,694 21,394 5,715 739 10,540 117,506 726,381 701,163 25,218 20,694 2,026 2,158 340 1,091,549 254,274 205,350 48,923 8,805 2,138 20,727 6,014 810 10,429 116,245 721,031 695,980 25,051 20,475 2,082 2,152 342 1,102,516 268,492 221,484 47,008 8,899 2,346 20,469 5,117 712 9,466 119,189 714,834 692,326 22,508 20,127 487 1,558 336 277,765 0 27,029 250,735 285,886 0 18,102 267,784 277,617 0 12,932 264,685 283,744 35 4,476 279,232 272,951 0 6,461 266,490 282,539 860 17,791 263,888 278,614 0 12,658 265,956 280,917 707 11,624 268,586 LIABILITIES 1,108,340 46 Deposits 261,092 47 Demand deposits 209,951 48 Individuals, partnerships, and corporations 51,141 49 Other holders 9,728 50 States and political subdivisions 2,824 51 U.S. government 22,325 Depository institutions in the United States 52 5,377 53 Banks in foreign countries 564 54 Foreign governments and official institutions 10,322 55 Certified and officers' checks 119,209 56 Transaction balances other than demand deposits . . . . 728,038 57 Nontransaction balances 702,726 58 Individuals, partnerships, and corporations 25,312 59 Other holders 20,827 60 States and political subdivisions 2,070 61 U . S . government 2,086 Depository institutions in the United States 62 329 Foreign governments, official institutions, and banks . . . . 63 64 Liabilities for borrowed money 5 65 Borrowings from Federal Reserve Banks 66 Treasury tax and loan notes Other liabilities for borrowed money 67 68 Other liabilities (including subordinated notes and debentures) 298,280 65 31,935 266,280 100,977 100,426 99,531 102,576 105,888 106,760 104,926 103,508 112,434 1,507,596 1,481,536 1,509,914 1,471,295 1,505,599 1,482,130 1,493,109 1,473,671 1,495,867 140,886 141,791 142,623 142,145 142,654 142,867 142,961 143,649 145,067 Total loans and leases, gross, adjusted, plus securities . . 1,340,416 115,165 Time deposits in amounts of $100,000 or more 916 Loans sold outright to affiliates 452 Commercial and industrial 464 Other ., 24,324 Foreign branch credit extended to U . S . residents -12,273 Net due to related institutions abroad 1,335,624 114,902 922 452 470 23,892 -14,758 1,340,392 114,874 910 452 458 23,807 -13,611 1,331,801 113,962 909 452 458 23,756 -10,277 1,348,568 113,729 898 453 446 23,407 -8,870 1,344,197 112,598 897 452 445 23,846 -10,560 1,349,907 111,983 8% 451 445 23,850 -8,945 1,339,343 110,167 893 449 444 23,150 -10,070 1,337,946 104,124 869 447 422 23,225 -12,388 69 Total liabOities 70 Residual (total assets less total liabilities) 7 MEMO 71 72 73 74 75 76 77 1. Includes certificates of participation, issued or guaranteed by agencies of the U.S. government, in pools of residential mortgages. 2. Includes securities purchased under agreements to resell. 3. Includes allocated transfer risk reserve. 4. Includes negotiable order of withdrawal accounts (NOWs), automatic transfer service (ATS), and telephone and preauthorized transfers of savings deposits. 5. Includes borrowings only from other than directly related institutions. 6. Includes federal funds purchased and securities sold under agreements to repurchase. 7. This balancing item is not intended as a measure of equity capital for use in capital-adequacy analysis. 8. Excludes loans to and federal funds transactions with commercial banks in the United States. 9. Affiliates include a bank's own foreign branches, nonconsolidated nonbank affiliates of the bank, the bank's holding company (if not a bank), and nonconsolidated nonbank subsidiaries of the holding company. 10. Credit extended by foreign branches of domestically chartered weekly reporting banks to nonbank U.S. residents. Consists mainly of commercial and industrial loans, but includes an unknown amount of credit extended to other than nonfinancial businesses. NOTE. Data that formerly appeared in table 1.28, Assets and Liabilities of Large Weekly Reporting Commercial Banks in N e w York City, can be obtained from the Board's H.4.2 (504) weekly statistical release. For ordering address, see inside front cover. Weekly Reporting Commercial Banks 1.30 LARGE WEEKLY REPORTING U.S. BRANCHES A N D AGENCIES OF FOREIGN B A N K S Liabilities 1 Millions of dollars, Wednesday figures A23 Assets and 1993 Account Feb. 3 1 Cash and balances due from depository institutions 2 U.S. Treasury and government agency securities 3 Other securities. 4 Federal funds sold 5 To commercial banks in the United States . . 6 To others 2 7 Other loans and leases, gross 8 Commercial and industrial 9 Bankers acceptances and commercial paper 10 All other 11 U.S. addressees 12 Non-U.S. addressees 13 Loans secured by real estate 14 To financial institutions 15 Commercial banks in the United States, 16 Banks in foreign countries 17 Nonbank financial institutions For purchasing and carrying securities . . . 18 19 To foreign governments and official institutions 20 All other 21 Other assets (claims on nonrelated parties) . 22 Total assets 3 23 Deposits or credit balances due to other than directly related institutions 24 Demand deposits 25 Individuals, partnerships, and corporations. 26 Other 27 Nontransaction accounts 28 Individuals, partnerships, and corporations 29 Other 30 Borrowings from other than directly related institutions 31 Federal funds purchased 5 32 From commercial banks in the United States 33 From others 34 Other liabilities for borrowed money 35 To commercial banks in the United States 36 To others 37 Other liabilities to nonrelated parties 38 Total liabilities 6 Feb. 17 Mar. 3 Mar. 10 Mar. 17 Mar. 24 Mar. 31 17,543 18,122 17,055 17,493 18,488 17,941 18,588 18,277 19,477 26,206 8,259 22,514 5,264 17,250 163,684 97,754 27,803 8,307 20,171 5,394 14,777 164,649 97,747 28,054 8,355 18,346 3,784 14,562 163,256 96,589 28,414 8,516 22,841 5,960 16,881 165,205 97,212 29,245 8,755 22,931 7,213 15,718 162,364 96,968 30,199 8,590 23,720 5,316 18,404 162,457 97,337 29,671 8,577 21,931 4,678 17,252 161,115 96,841 31,416 8,478 23,044 8,710 14,334 160,810 96,272 2,571 96,345 93,254 3,090 33,758 23,980 5,357 1,919 16,704 4,201 2,546 95,207 92,162 3,046 33,801 25,493 5,582 2,004 17,907 3,902 2,776 94,971 91,663 3,307 33,778 26,449 5,814 2,014 18,621 4,069 2,768 93,821 90,517 3,304 33,415 26,446 5,608 1,999 18,840 4,371 2,676 94,536 91,112 3,424 33,297 27,285 6,311 2,195 18.780 4,906 2,697 94,271 90,900 3,371 33,307 25,707 5,582 1,819 18,306 3,903 2,580 94,758 91,363 3,394 33,356 26,074 5,771 1,784 18,520 3,299 2,644 94,198 90,776 3,421 33,272 25,313 5,396 1,666 18,251 2,585 2,699 93,572 90,282 3,291 32,604 25,135 4,956 1,866 18,313 3,794 333 2,358 31,916 407 2,327 31,916 412 2,194 31,117 395 2,040 31,714 398 2,107 32,209 396 2,082 32,090 386 2,004 30,910 370 2,734 30,741 368 2,637 33,934 307,487 304,749 302,616 302,014 312,754 310,535 309,771 306,975 306,235 102,342 4,365 101,909 4,551 100,295 3,765 103,0% 3,998 101.333 4,148 99,966 3,859 99,680 4,061 99,825 3,911 102,792 4,933 2,653 1,712 97,977 2,868 1,683 97,357 2,878 887 96,530 2,952 1,046 99,098 3,144 1,004 97,185 2,962 897 96,107 3,060 1,001 95,619 3,219 693 95,914 3,413 1,519 97,859 69,466 28,511 68,244 29,113 66,900 29,630 69,106 29,992 67,619 29,566 67,240 28,866 66,701 28,918 66,456 29,458 67,958 29,901 87,797 47,476 88,234 45,592 88,470 45,320 83,919 41,104 94,763 47,578 94,459 44,887 94,217 47,768 88,359 43,257 86,619 45,148 14,970 32,506 40,321 11,836 33,757 42,641 14,851 30.469 43,150 10,863 30,242 42,815 14,652 32,926 47,185 14,994 29,893 49,573 16,264 31,504 46,450 11,999 31,259 45,101 18,625 26,523 41,471 8,733 31,588 31,127 9,331 33,310 31,938 9,459 33,691 30,994 8,544 34,271 31,276 9,154 38,030 31,245 9,981 39,591 32,486 10,194 36,256 30,136 9,619 35,483 30,320 9,317 32,154 32,462 307,487 304,749 302,616 302,014 312,754 310,535 309,771 306,975 306,235 212,246 50,502 209,817 48,620 209,722 49,342 208,619 48,926 212,705 48,332 210,498 46,414 213,879 50,431 211,219 51,807 210,082 55,286 1. Includes securities purchased under agreements to resell. 2. Includes transactions with nonbank brokers and dealers in securities. 3. Includes net due from related institutions abroad for U.S. branches and agencies of foreign banks having a net "due from" position. 4. Includes other transaction deposits. Feb. 24 27,157 8,246 23,360 4,706 18,654 163,546 98,916 MEMO 39 Total loans (gross) and securities, adjusted 40 Net due to related institutions abroad Feb. 10 5. Includes securities sold under agreements to repurchase. 6. Includes net to related institutions abroad for U.S. branches and agencies of foreign banks having a net "due to" position. 7. Excludes loans to and federal funds transactions with commercial banks in the United States. A24 1.32 DomesticNonfinancialStatistics • June 1993 COMMERCIAL PAPER A N D B A N K E R S DOLLAR ACCEPTANCES O U T S T A N D I N G Millions of dollars, end of period Year ending December 1992 1993 Item 1989 1988 1991 1990 1992 Sept. Oct. Nov. Dec. Jan. Feb. Commercial paper (seasonally adjusted unless noted otherwise) 1 All issuers 458,464 525,831 562,656 r 531,724 r 549,433 r 550,727 r 557,915 r 558,414 r 549,433 r 542,438 529,400 159,777 183,622 234,242 r 231,751" 230,966" 228,260" 215,126 203,716 1 2 3 4 5 Financial companies Dealer-placed paper Total Bank-related (not seasonally adjusted) Directly placed paper4 Total Bank-related (not seasonally adjusted) 6 Nonfinancial companies 214,706 r 213,823 r 228,260 r n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 210,930 200,036 r 183,379" 172,813r 178,184" 181,388" 179,279" 172,813" 181,264 177,370 1,248 194,931 5 43,155 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 103,756 131,279 147,914r 134,522r 148,360" 138,301" 144,776" 148,169" 148,360" 146,048 148,314 Bankers dollar acceptances (not seasonally adjusted) 6 7 Total 8 9 10 11 12 Holder Accepting banks Own bills Bills bought from other banks Federal Reserve Banks Foreign correspondents Others Basis 13 Imports into United States 14 Exports from United States 15 All other 66,631 62,972 54,771 43,770 38,194 37,814 37,599 37,651 38,194 35,995' 35,212 9,086 8,022 1,064 9,433 8,510 924 9,017 7,930 1,087 11,017 9,347 1,670 10,555 9,097 1,458 10,436 9,073 1,363 10,236 8,764 1,472 10,301 9,156 1,145 10,555 9,097 1,458 9,115" 7,922" 1,193 9,869 8,352 1,516 1,493 56,052 1,066 52,473 918 44,836 1,739 31,014 1,276 26,364 1,803 25,575 1,204 26,159 1,289 26,061 1,276 26,364 1,317 25,563" 1,169 24,175 14,984 14,410 37,237 15,651 13,683 33,638 13,095 12,703 28,973 12,843 10,351 20,577 12,209 8,096 17,890 12,227 8,051 17,536 12,116 7,849 17,633 12,133 7,673 17,846 12,209 8,096 17,890 11,146 7,740" 17,109 11,120 7,547 16,545 1. Institutions engaged primarily in commercial, savings, and mortgage banking; sales, personal, and mortgage financing; factoring, finance leasing, and other business lending; insurance underwriting; and other investment activities. 2. Includes all financial-company paper sold by dealers in the open market. 3. Bank-related series were discontinued in January 1989. 4. As reported by financial companies that place their paper directly with investors. 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. Data on bankers acceptances are gathered from approximately 100 institutions. The reporting group is revised every January. 7. In 1977 the Federal Reserve discontinued operations in bankers acceptances for its own account. PRIME RATE C H A R G E D BY B A N K S on Short-Term Business Loans 1 Percent per year Rate 10.50 10.00 9.50 9.00 8.50 8.00 7.50 6.50 6.00 Period Average rate 10.01 8.46 6.25 1990 1991 1992 1990 Feb. Mar. Apr. May . June July . Aug. Sept. Oct. . Nov. Dec. 10.11 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00 10.00 1. Data in this table also appear in the Board's H.15 (519) weekly and G.13 (415) monthly statistical releases. For ordering address, see inside front cover. Average rate 1991—Jan. ... Feb. .. Mar. .. Apr. .. May ... June .. July ... Aug. .. Sept. .. Oct. ... Nov. .. Dec. .. 9.52 9.05 9.00 9.00 8.50 8.50 8.50 8.50 8.20 8.00 7.58 7.21 Period 1992—Jan. ... Feb. .. Mar. .. Apr. .. May ... June .. July ... Aug. .. Sept. .. Oct. ... Nov. .. Dec. 1993— Jan. Feb. Mar. Apr. Financial Markets 1.35 A25 I N T E R E S T R A T E S Money and Capital Markets Averages, percent per year; weekly, monthly, and annual figures are averages of business day data unless otherwise noted 1992 1990 1991 1993, week ending 1993 1992 Dec. Jan. Feb. Mar. Feb. 26 Mar. 5 Mar. 12 Mar. 19 M O N E Y MARKET INSTRUMENTS 8.10 6.98 5.69 5.45 3.52 3.25 2.92 3.00 3.02 3.00 3.03 3.00 3.07 3.00 2.91 3.00 3.24 3.00 3.02 3.00 3.04 3.00 8.15 8.06 7.95 5.89 5.87 5.85 3.71 3.75 3.80 3.71 3.67 3.70 3.21 3.25 3.35 3.14 3.18 3.27 3.15 3.17 3.24 3.11 3.15 3.23 3.13 3.15 3.23 3.15 3.18 3.26 3.16 3.18 3.24 8.00 7.87 7.53 5.73 5.71 5.60 3.62 3.65 3.63 3.68 3.58 3.52 3.25 3.32 3.29 3.18 3.27 3.21 3.15 3.17 3.14 3.17 3.26 3.20 3.20 3.24 3.17 3.18 3.21 3.17 3.16 3.17 3.16 7.93 7.80 5.70 5.67 3.62 3.67 3.44 3.47 3.14 3.23 3.06 3.15 3.07 3.14 3.05 3.10 3.06 3.11 3.08 3.15 3.08 3.15 8.15 8.15 8.17 5.82 5.83 5.91 3.64 3.68 3.76 3.57 3.48 3.55 3.14 3.19 3.33 3.08 3.12 3.22 3.10 3.11 3.20 3.06 3.10 3.18 3.10 3.11 3.19 3.09 3.12 3.21 3.10 3.11 3.21 8.16 5.86 3.70 3.50 3.22 3.12 3.11 3.08 3.08 3.13 3.13 7.50 7.46 7.35 5.38 5.44 5.52 3.43 3.54 3.71 3.22 3.36 3.55 3.00 3.14 3.35 2.93 3.07 3.25 2.95 3.05 3.20 2.95 3.04 3.17 2.95 3.04 3.17 2.98 3.09 3.26 2.97 3.08 3.22 7.51 7.47 7.36 5.42 5.49 5.54 3.45 3.57 3.75 3.25 3.39 3.57 3.06 3.17 3.52 2.95 3.08 3.32 2.97 3.08 3.09 2.96 3.06 n.a. 2.97 3.05 n.a. 2.98 3.09 3.09 3.00 3.12 n.a. 7.89 8.16 8.26 8.37 8.52 8.55 8.61 5.86 6.49 6.82 7.37 7.68 7.86 8.14 3.89 4.77 5.30 6.19 6.63 7.01 7.67 3.71 4.67 5.21 6.08 6.46 6.77 7.44 3.50 4.39 4.93 5.83 6.26 6.60 7.34 3.39 4.10 4.58 5.43 5.87 6.26 7.09 3.33 3.95 4.40 5.19 5.66 5.98 6.82 3.31 3.95 4.38 5.21 5.64 6.02 6.89 3.30 3.85 4.28 5.09 5.54 5.90 6.79 3.39 4.03 4.47 5.24 5.65 5.96 6.76 3.36 3.99 4.46 5.23 5.73 6.03 6.85 8.74 8.16 7.52 7.30 7.17 6.89 6.65 6.70 6.58 6.59 6.69 6.96 7.29 7.27 6.56 6.99 6.92 6.09 6.48 6.44 5.91 6.27 6.22 5.91 6.28 6.16 5.61 5.98 5.87 5.42 5.81 5.64 5.47 5.84 5.60 5.29 5.66 5.47 5.18 5.58 5.58 5.64 6.05 5.71 9.77 9.23 8.55 8.35 8.24 8.01 7.83 7.88 7.81 7.80 7.85 9.32 9.56 9.82 10.36 8.77 9.05 9.30 9.80 8.14 8.46 8.62 8.98 7.98 8.24 8.37 8.81 7.91 8.11 8.26 8.67 7.71 7.90 8.03 8.39 7.58 7.72 7.86 8.15 7.61 7.77 7.90 8.22 7.56 7.70 7.84 8.12 7.54 7.70 7.83 8.11 7.61 7.74 7.88 8.16 10.01 9.32 8.52 8.27 8.13 7.80 7.61 7.63 7.47 7.62 7.58 MEMO 7.45 8.17 7.46 8.96 2.90 Dividend-price ratio 2.99 3.61 3.25 38 Preferred stocks 39 Common stocks 1. The daily effective federal funds rate is a weighted average of rates on trades through N e w York brokers. 2. Weekly figures are averages of seven calendar days ending on Wednesday of the current week; monthly figures include each calendar day in the month. 3. Annualized using a 360-day year or bank interest. 4. Rate for the Federal Reserve Bank of N e w York. 5. Quoted on a discount basis. 6. An average of offering rates on commercial paper placed by several leading dealers for firms whose bond rating is A A or the equivalent. 7. An average of offering rates on paper directly placed by finance companies. 8. Representative closing yields for acceptances of the highest-rated money center banks. 9. An average of dealer offering rates on nationally traded certificates of deposit. 10. Bid rates for Eurodollar deposits at 11 a.m. London time. Data are for indication purposes only. 11. Auction date for daily data; weekly and monthly averages computed on an issue-date basis. 7.25 2.88 7.37 2.81 6.70 2.76 7.29 2.82 6.82 2.77 6.66 2.73 6.73 2.78 1 Federal funds 1 , 2 , 3 2 Discount window borrowing^ paper3'5,6 3 4 5 Commercial 1-month 3-month 6-month 6 7 8 Finance paper, 1-month 3-month 6-month placed3,5,7 directly 9 10 Bankers acceptances3,5,8 3-month 6-month 11 12 13 Certificates of deposit, marker 1-month 3-month 6-month secondary 14 Eurodollar deposits, 3-month 3 1 0 U.S. Treasury bills Secondary market 3,5 3-month 6-month 1-year Auction average ' '' 18 3-month 19 6-month 20 1-year 15 16 17 U . S . TREASURY N O T E S A N D B O N D S 21 22 23 24 25 26 27 Constant 1-year 2-year 3-year 5-year 7-year 10-year 30-year maturities12 Composite 28 More than 10 years (long-term) STATE A N D LOCAL N O T E S A N D B O N D S Moody's series13 29 Aaa 30 Baa 31 Bond Buyer series 14 CORPORATE B O N D S 32 Seasoned issues, all industries 15 Rating 33 Aaa 34 Aa 35 A group 36 Baa 37 A-rated, recently offered utility bonds 16 . 12. Yields on actively traded issues adjusted to constant maturities. Source: U.S. Treasury. 13. General obligations based on Thursday figures; Moody's Investors Service. 14. General obligations only, with twenty years to maturity, issued by twenty state and local governmental units of mixed quality. Based on figures for Thursday. 15. Daily figures from Moody's Investors Service. Based on yields to maturity on selected long-term bonds. 16. Compilation of the Federal Reserve. This series is an estimate of the yield on recently offered, A-rated utility bonds with a thirty-year maturity and five years of call protection. Weekly data are based on Friday quotations. 17. Standard and Poor's corporate series. Preferred stock ratio based on a sample of ten issues: four public utilities, four industrials, one financial, and one transportation. Common stock ratios on the 500 stocks in the price index. NOTE. These data also appear in the Board's H. 15 (519) and G. 13 (415) releases. For ordering address, see inside front cover. A26 1.36 DomesticNonfinancialStatistics • June 1993 STOCK MARKET Selected Statistics 1992 Indicator 1991 1990 1993 1992 July Aug. Sept. Nov. Oct. Dec. Jan. Feb. Mar. Prices and trading volume (averages of daily figures) Common stock prices (indexes) 1 N e w York Stock Exchange (Dec. 31, 1965 = 50) 2 Industrial 3 Transportation 4 Utility 5 Finance 183.66 226.06 158.80 90.72 133.21 206.35 258.16 173.97 92.64 150.84 229.00 284.26 201.02 99.48 179.29 228.17 281.90 198.36 101.18 180.96 230.07 284.44 191.31 103.41 180.47 230.13 285.76 191.61 102.26 178.27 226.97 279.70 192.30 101.62 181.36 232.84 287.80 204.63 101.13 189.27 239.47 290.77 212.35 103.85 196.87 239.75 r 292.11 221.00 105.52 203.38 243.41 294.40 226.96 109.45 209.93 248.12 298.75 229.42 112.53 217.01 6 Standard & Poor's Corporation ( 1 9 4 1 - 4 3 = 10)' 335.01 376.20 415.75 415.05 417.93 418.48 412.50 422.84 435.64 435.40 r 441.76 450.15 7 American Stock Exchange (Aug. 31, 1973 = 5 0 ? 338.32 360.32 391.28 384.07 385.80 382.67 371.27 387.75 392.69 402.75 r 409.39 418.56 156,359 13,155 179,411 12,486 202,558 14,171 194,138 10,722 174,003 11,875 191,774 11,198 204,787 11,966 208,221 14,925 222,736 16,523 266,011 17,184 288,540 18,154 251,170 16,150 Volume of trading (thousands 8 N e w York Stock Exchange 9 American Stock Exchange of shares) Customer financing (millions of dollars, end-of-period balances) 10 Margin credit at broker-dealers Free credit balances 11 Margin accounts 5 12 Cash accounts at 28,210 36,660 43,990 39,640 39,940 41,250 41,590 43,630 43,990 44,020 44,290 45,160 8,050 19,285 8,290 19,255 8,970 22,510 7,920 18,775 8,060 18,305 8,060 19,650 8,355 18,700 8,500 19,310 8,970 22,510 8,980 20,360 9,790 22,190 9,650 21,450 4 brokers Margin requirements (percent of market value and effective date) 6 June 8, 1968 May 6, 1970 Dec. 6, 1971 Nov. 24, 1972 70 50 70 80 60 80 65 50 65 55 50 55 65 50 65 1. Effective July 1976, includes a new financial group, banks and insurance companies. With this change the index includes 400 industrial stocks (formerly 425), 20 transportation (formerly 15 rail), 40 public utility (formerly 60), and 40 financial. 2. On July 5, 1983, the American Stock Exchange rebased its index, effectively cutting previous readings in half. 3. Since July 1983, under the revised Regulation T, margin credit at brokerdealers has included credit extended against stocks, convertible bonds, stocks acquired through the exercise of subscription rights, corporate bonds, and government securities. Separate reporting of data for margin stocks, convertible bonds, and subscription issues was discontinued in April 1984. 4. Free credit balances are amounts in accounts with no unfulfilled commitments to brokers and are subject to withdrawal by customers on demand. 5. N e w series since June 1984. 6. These requirements, stated in regulations adopted by the Board of Governors pursuant to the Securities Exchange Act of 1934, limit the amount of credit that can be used to purchase and carry "margin securities" (as defined in the regulations) when such credit is collateralized by securities. Margin requirements Jan. 3, 1974 ooo 13 Margin stocks 14 Convertible bonds 15 Short sales Mar. 11, 1968 on securities other than options are the difference between the market value (100 percent) and the maximum loan value of collateral as prescribed by the Board. Regulation T was adopted effective Oct. 15, 1934; Regulation U , effective May 1, 1936; Regulation G, effective Mar. 11, 1968; and Regulation X, effective Nov. 1, 1971. On Jan. 1, 1977, the Board of Governors for the first time established in Regulation T the initial margin required for writing options on securities, setting it at 30 percent of the current market value of the stock underlying the option. On Sept. 30, 1985, the Board changed the required initial margin, allowing it to be the same as the option maintenance margin required by the appropriate exchange or self-regulatory organization; such maintenance margin rules must be approved by the Securities and Exchange Commission. Effective Jan. 31, 1986, the SEC approved new maintenance margin rules, permitting margins to be the price of the option plus 15 percent of the market value of the stock underlying the option. Effective June 8, 1988, margins were set to be the price of the option plus 20 percent of the market value of the stock underlying the option (or 15 percent in the case of stock-index options). Financial Markets 1.37 S E L E C T E D F I N A N C I A L INSTITUTIONS All Selected Assets and Liabilities Millions of dollars, end of period 1993 1992 1990 Account 1991 Apr. May June July Aug. Sept. Oct. Nov. Dec. Jan. n.a. n.a. SAIF-insured institutions 1 Assets 1,084,821 919,979 872,026 870,334 861,517 856,390 856,165 847,235 846,730 840,605 633,385 551,322 524,954 521,911 516,654 512,264 512,077 508,815 502,863 496,974 155,228 129,461 124,763 124,225 123,282 122,385 120,438 119,715 120,715 120,292 16,897 24,125 48,753 12,307 17,139 41,775 10,959 15,075 37,999 11,120 14,607 37,868 11,282 14,020 37,403 11,044 13,929 37,230 11,164 13,525 37,123 11,073 13,419 36,732 11,207 13,630 35,938 10,509 13,180 36,019 2 Mortgages 3 Mortgage-backed securities 4 Contra-assets to mortgage assets 1 . 5 Commercial loans 6 Consumer loans 7 Contra-assets to nonmortgage l o a n s 1 . . 8 Cash and investment securities 9 Other 2 1,939 1,239 980 949 944 910 932 982 931 845 146,644 95,522 120,077 73,751 116,462 64,711 120,763 63,030 119,539 62,844 120,220 62,317 124,140 60,958 120,684 59,925 126,719 59,002 127,893 57,600 10 Liabilities and net worth . 1,084,821 919,979 872,026 870,334 861,517 856,390 856,165 847,235 846,730 840,605 835,496 197,353 100,391 96,962 21,332 30,640 731,937 121,923 65,842 56,081 17,560 48,559 689,777 111,262 62,268 48,994 18,883 52,103 688,199 110,126 61,439 48,687 19,626 52,383 682,535 108,943 62,760 46,183 17,740 52,299 676,141 109,036 62,359 46,677 18,570 52,642 672,354 110,109 62,225 47,884 20,523 53,178 667,027 110,022 64,105 45,917 18,017 52,169 660,906 114,123 63,065 51,058 19,853 51,846 654,047 114,354 64,742 49,612 20,406 51,798 11 12 13 14 15 16 Deposits Borrowed money FHLBB Other Other N e t worth 1. Contra-assets are credit-balance accounts that must be subtracted from the corresponding gross asset categories to yield net asset levels. Contra-assets to mortgage assets, mortgage loans, contracts, and pass-through securities—include loans in process, unearned discounts and deferred loan fees, valuation allowances for mortgages "held for sale," and specific reserves and other valuation allowances. Contra-assets to nonmortgage loans include loans in process, unearned discounts and deferred loan fees, and specific reserves and valuation allowances. 2. Includes holding of stock in Federal Home Loan Bank and finance leases plus interest. 1.38 NOTE. Components do not sum to totals because of rounding. Data for credit unions and life insurance companies have been deleted from this table. Starting in the December 1991 issue, data for life insurance companies are shown in a special table of quarterly data. SOURCE. Office of Thrift Supevision (OTS), insured by the Savings Association Insurance Fund (SAIF) and regulated by the OTS. F E D E R A L F I S C A L A N D F I N A N C I N G OPERATIONS Millions of dollars Fiscal year Calendar year 1990 U.S. budget' 1 Receipts, total 7. On-budget 3 Off-budget 4 Outlays, total 5 On-budget 6 Off-budget 7 Surplus or deficit ( - ) , total 8 On-budget Off-budget 9 Source of financing (total) 10 Borrowing from the public 11 Operating cash (decrease, or increase ( - ) ) . . . 12 Other 2 1993 1992 Type of account or operation 1991 1992r Oct. Nov. Dec. Jan. Feb. Mar. 1,031,308 749,654 281,654 1,251,766 1,026,701 225,064 -220,458 -277,047 56,590 1,054,265 760,382 293,883 1,323,757 1,082,072 241,685 -269,492 -321,690 52,198 1,090,499 788,073 302,426 1,380,482 1,128,143 252,339 -289,983 -340,070 50,087 76,832 55,056 21,776 125,627 r 103,786r 21,841 -48,795 r -48,730" -65 74,633 51,219 23,414 107,361 r 83,442 r 23,919 -32,728r -32,223r -505 113,690" 89,594 r 24,096 152,636 r 116,575 r 36,061 -38,946r -26,981r -11,965 112,718 r 90,129 22,589 82,903 r 84,928 r -2,025 29,815 r 5,201 r 24,614 66,136 r 41,036 r 25,100 113,730 r 89,274 r 24,456 -47,594 -48,238r 644 83,453 57,259 26,194 128,029 103,793 24,237 -46,577 -46,534 1,957 220,101 818 -461 276,802 -1,329 -5,981 310,918 -17,305 -3,630 -1,552 39,420 10,927r 61,969 -7,346 -21,895r 21,078 -3,175 21,043 r -8,355 -16,436 -5,024r 30,689 27,227 -10,322 37,727 -2,452 9,302 40,155 7,638 32,517 41,484 7,928 33,556 58,789 24,586 34,203 19,369 4,413 14,956 26,715 6,985 19,729 29,890 7,492 22,399 46,326 9,572 36,754 19,099 5,350 13,749 21,551 6,752 14,799 MEMO 13 Treasury operating balance (level, end of period) 14 Federal Reserve Banks 15 Tax and loan accounts 1. In accordance with the Balanced Budget and Emergency Deficit Control Act of 1985, all former off-budget entries are now presented on-budget. Federal Financing Bank (FFB) activities are now shown as separate accounts under the agencies that use the FFB to finance their programs. The act also moved two social security trust funds (federal old-age survivors insurance and federal disability insurance) off budget. The Postal Service is included as an off-budget item in the Monthly Treasury Statement beginning in 1990. 2. Includes special drawing rights (SDRs); reserve position on the U.S. quota in the International Monetary Fund (IMF); loans to the IMF; other cash and monetary assets; accrued interest payable to the public; allocations of SDRs; deposit funds; miscellaneous liability (including checks outstanding) and asset accounts; seigniorage; increment on gold; net gain or loss for U . S . currency valuation adjustment; net gain or loss for IMF loan-valuation adjustment; and profit on sale of gold. SOURCES. Monthly Treasury Statement of Receipts and Outlays of the U.S. Government (MTS) and the Budget of the U.S. Government. A28 1.39 D o m e s t i c Financial Statistics • June 1993 U . S . B U D G E T RECEIPTS A N D O U T L A Y S 1 Millions of dollars Fiscal year Calendar year 1991 Source or type 1991 1992 1993 1992 Hlr H2 Jan. Feb. Mar. 519,180"^ 560,341 540,501 r 112,718 r r HI H2 540,504 RECEIPTS 1 All sources 2 Individual income taxes, net 12 13 Withheld Presidential Election Campaign Fund . . . . Nonwithheld Refunds Corporation income taxes Gross receipts Refunds Social insurance taxes and contributions, net Employment taxes and contributions Self-employment taxes and contributions 3 Unemployment insurance Other net receipts 4 14 15 16 17 Excise taxes Customs deposits Estate and gift taxes Miscellaneous receipts 3 4 6 1 8 9 10 11 1,054,265 1,090,499" 66,136 83,453 467,827 404,152 32 142,693 79,050 r 476,l22 408,352 30 149,342 81,691 r 232,389 193,440 31 109,405 70,487 234,939 210,552 1 33,296 8,910"^ 236,719 198,868 20 110,997 73,165 246,961 215,591 10 39,371 8,011 73,704 36,255 0 38,452 1,003 23,947 33,652 4 967 10,677 27,935 40,006 6 5,253 17,330 113,599 15,513 117,951 17,680 58,903 7,904 54,016 8,649 61,682 9,403 58,022 7,219 3,969 758 2,510 1,719 14,644 1,920 396,011 413,689 214,303 186,839 224,570 192,599 29,416 34,251 33,652 370,526 385,491 199,727 175,802 208,110 180,758 28,209 31,623 32,980 25,457 20,922 4,563 24,421 23,410 4,788 22,150 12,296 2,279 3,306 8,721 2,317 20,433 14,070 2,389 3,988 9,397 2,445 -3,032 844 363 1,487 2,259 369 873 240 432 42,430 15,921 11,138 22,852 45,570 17,359 11,143 26,507 r 20,703 7,488 5,631 8,991 24,429 8,694 5,507 13,405r 22,389 8,146 5,701 10,686 23,456 9,497 5,733 11,467r 3,307 1,310 888 88 l r 3,342 1,347 822 1,637 4,514 1,598 977 2,051 1,323,757 l,380,482 r 632,153 694,362 r 704,279 723,201 r 82,903 r 113,730 128,029 298,361 16,106 16,409 4,509 20,017 14,997 122,089 7,592 7,496 1,235 8,324 7,684 147,669 7,691 8,472 1,698 11,130 7,418 147,064 8,537 7,952 1,442 8,607 7,526 155,501 9,911 8,521 3,109 11,617 8,881 19,683 1,161 1,395 15 1,372 1,206 22,903 1,253 1,325 399 1,282 1,145 25,511 1,181 1,103 560 1,549 4,244 17,992 14,748 3,552 36,534 17,093 3,783 15,610 15,676 3,902 -7,843 18,477 4,540 -1,832 2,363 650 -3,532 2,093 690 -1,368 3,383 760 OUTLAYS 18 All types 19 20 21 22 23 24 National defense International affairs General science, space, and technology . . . . Energy Natural resources and environment Agriculture 25 26 27 28 Commerce and housing credit Transportation Community and regional development Education, training, employment, and social services 29 Health 30 Social security and medicare 31 Income security 32 33 34 35 36 Veterans benefits and services Administration of justice General government Net interest 6 Undistributed offsetting receipts 272,514 16,167 15,946 2,511 18,708 14,864 75,639 31,531 7,432 9,753 r 33,759" 7,923 r 41,479 45,248 21,234 21,114 23,225 20,922 4,360 4,068 4,607 71,183 373,495 171,618 89,570 406,569 r 197,867r 35,608 190,247 88,778 41,459 193,098 87,693 r 44,034 205,500 104,951 47,223 232,109 98,693 r 7,828 10,376 16,135 r 8,053 35,005 21,259 8,379 37,235 21,056 31,344 12,295 11,358 195,012 -39,356 34,133 14,450 12,939 199,429 -39,280 15,596 7,434 5,050 100,401 -18,228 18,561 7,283 8,138 98,549 -20,914 1,641 1,222 133 17,858 -2,660 2,649 1,060 994 15,893 -2,809 4,090 1,270 1,040 16,415 -2,987 14,326 6,187 5,212 98,556 -18,702 1. Functional details do not sum to total outlays for calendar year data because revisions to monthly totals have not been distributed among functions. Fiscal year total for outlays does not correspond to calendar year data because revisions from the Budget have not been fully distributed across months. 2. Old-age, disability, and hospital insurance, and railroad retirement accounts. 3. Old-age, disability, and hospital insurance. 4. Federal employee retirement contributions and civil service retirement and disability fund. 17,425 6,574 6,794 99,149 -20,436 5. Deposits of earnings by Federal Reserve Banks and other miscellaneous receipts. 6. Includes interest received by trust funds. 7. Consists of rents and royalties for the outer continental shelf and U.S. government contributions for employee retirement. SOURCES. U.S. Department of the Treasury, Monthly Treasury Statement of Receipts and Outlays of the U.S. Government, and the U . S . Office of Management and Budget, Budget of the U.S. Government, Fiscal Year 1994. Federal Finance 1.40 A29 FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION Billions o f dollars, end o f month 1993 Mar. 31 June 30 Sept. 30 Dec. 31 Mar. 31 June 30 Sept. 30 1 Federal debt outstanding 3,492 3,563 3,683 3,820 3,897 4,001 4,083 4,196 2 Public debt securities 3 Held by public 4 Held by agencies 3,465 2,598 867 3,538 2,643 895 3,665 2,746 920 3,802 2,833 969 3,881 2,918 964 3,985 2,977 1,008 4,065 3,048 1,016 4,177 3,129 1,048 27 26 25 25 18 18 19 19 16 16 16 16 18 18 19 19 3,377 3,450 3,569 3,707 3,784 3,891 3,973 4,086 4,140R 3,377 3,450 3,569 3,706 3,783 3,890 3,972 4,085 4,139" 4,145 4,145 4,145 4,145 4,145" 5 Agency securities 6 Held by public 7 Held by agencies 0 8 Debt subject to statutory limit. 9 Public debt securities 10 Other debt 1 0 0 0 MEMO 0 0 0 4,145 11 Statutory debt limit 1. Consists of guaranteed debt of Treasury and other federal agencies, specified participation certificates, notes to international lending organizations, and District of Columbia stadium bonds. 1.41 0 GROSS PUBLIC DEBT OF U.S. TREASURY 0 0 0 0 0 0 SOURCES. U.S. Treasury Department, Monthly Statement the United States and Treasury Bulletin. Dec. 31 0 0 4,231 r n.a. r n.a. 1 n.a. r n.a. r n.a. r 0" of the Public Debt of Types and Ownership Billions of dollars, end o f period 1993 1992 Type and holder 1989 1990 1991 1992 Q2 1 Total gross public debt By type 2 Interest-bearing 3 Marketable 4 Bills 5 Notes 6 Bonds 7 Nonmarketable 8 State and local government series 9 Foreign issues 10 Government 11 Public 12 Savings bonds and notes. 13 Government account series 14 Non-interest-bearing By holder 4 15 U . S . Treasury and other federal agencies and trust funds 16 Federal Reserve Banks 17 Private investors 18 Commercial banks 19 Money market funds 20 Insurance companies 21 Other companies 22 State and local treasuries Individuals 23 Savings bonds 24 Other securities 25 Foreign and international 26 Other miscellaneous investors Q4 Q1 2,953.0 3,364.8 3,801.7 4,177.0 3,984.7 4,064.6 4,177.0 4,230.6 2,931.8 1,945.4 430.6 1,151.5 348.2 986.4 163.3 6.8 6.8 .0 115.7 695.6 21.2 3,362.0 2,195.8 527.4 1,265.2 388.2 1,166.2 160.8 43.5 43.5 .0 124.1 813.8 2.8 3,798.9 2,471.6 590.4 1,430.8 435.5 1,327.2 159.7 41.9 41.9 .0 135.9 959.2 2.8 4,173.9 2,754.1 657.7 1,608.9 472.5 1,419.8 153.5 37.4 37.4 .0 155.0 1,043.5 3.1 3,981.8 2,605.1 618.2 1,517.6 454.3 1,376.7 161.9 38.7 38.7 .0 143.2 1,002.5 2.9 4,061.8 2,677.5 634.3 1,566.4 461.8 1,384.3 157.6 37.0 37.0 .0 148.3 1,011.0 2.8 4,173.9 2,754.1 657.7 1,608.9 472.5 1,419.8 153.5 37.4 37.4 .0 155.0 1,043.5 3.1 4,227.6 2,807.1 659.9 1,652.1 480.2 1,420.5 151.6 37.0 37.0 .0 161.4 1,040.0 3.0 707.8 228.4 2,015.8 164.9 14.9 125.1 93.4 487.5 828.3 259.8 2,288.3 171.5 45.4 142.0 108.9 490.4 968.7 281.8 2,563.2 233.4 80.0 168.7 150.8 520.3 1,047.8 302.5 2,839.9 292.0 80.6 183.0 192.5 532.0 1,007.9 276.9 2,712.4 267.3" 79.4 180.8" 175.0 528.5 1,016.3 296.4 2,765.5 286.7" 79.8" 181.6" 180.8 530.0 1,047.8 302.5 2,839.9 292.0 80.6 183,0 192.5 532.0 117.7 98.7 392.9 520.7 126.2 107.6 421.7 674.5 138.1 125.8 455.0 691.1 157.3 131.9 512.5 758.1 145.4 129.7 492.9 713.5" 150.3 130.9 499.0 726.3" 157.3 131.9 512.5 758.1 1. Includes (not shown separately) securities issued to the Rural Electrification Administration, depository bonds, retirement plan bonds, and individual retirement bonds. 2. Nonmarketable series denominated in dollars, and series denominated in foreign currency held by foreigners. 3. Held almost entirely by U.S. Treasury and other federal agencies and trust funds. 4. Data for Federal Reserve Banks and U.S. government agencies and trust funds are actual holdings; data for other groups are Treasury estimates. Q3 n.a. 5. Consists of investments of foreign balances and international accounts in the United States. 6. Includes savings and loan associations, nonprofit institutions, credit unions, mutual savings banks, corporate pension trust funds, dealers and brokers, certain U.S. Treasury deposit accounts, and federally sponsored agencies. SOURCES. U.S. Treasury Department, data by type of security, Monthly Statement of the Public Debt of the United States; data by holder, the Treasury Bulletin. A30 1.42 DomesticNonfinancialStatistics • June 1993 U . S . G O V E R N M E N T SECURITIES D E A L E R S Transactions 1 Millions of dollars, daily averages 1992 1993, week ending 1993 Item Dec. Jan. Feb. Feb. 3 Feb. 10 Feb. 17 Feb. 24 Mar. 3 Mar. 10 Mar. 17 Mar. 24 Mar. 31 IMMEDIATE TRANSACTIONS 2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 By type of security U.S. Treasury securities Bills Coupon securities, by maturity Less than 3.5 years 3.5 to 7.5 years 7.5 to 15 years 15 years or more Federal agency securities Debt, by maturity Less than 3.5 years 3.5 to 7.5 years 7.5 years or more Mortgage-backed Pass-throughs All others By type of counterparty Primary dealers and brokers U . S . Treasury securities Federal agency securities Debt Mortgage-backed Customers U.S. Treasury securities Federal agency securities Debt Mortgage-backed 42,358 48,056 44,513 42,512 46,358 43,801 45,439 42,368 60,426 37,544 39,583 36,322 36,143 28,723 13,054 11,093 47,717 46,216 19,149 16,239 56,575 48,292 28,505 21,480 50,106 46,365 21,061 16,349 58,885 44,155 30,741 18,095 55,363 42,127 27,176 26,574 63,656 60,642 33,253 25,249 45,826 46,067 25,537 15,485 55,509 53,711 30,411 23,961 43,753 43,393 24,281 19,067 47,550 40,783 19,568 14,606 43,291 42,606 17,455 13,979 824r l,169 r 6,719 881 1,194 7,082 877 1,046 7,228 955 1,350 6,727 715 1,157 6,213 880 1,186 6,151 1,123 1,138 4,902 854 1,070 5,281 706 1,022 6,042 887 1,171 6,718 503 1,228 14,208 3,122 20,000 3,751 r 22,544 4,505 15,083 4,909 29,594 3,406 24,142 3,413 20,093 5,772 18,247 6,206 22,852 3,641 14,743 3,391 9,641 3,517 9,461 4,369 80,472 109,246 123,551 108,449 124,847 119,783 141,507 107,496 137,942 106,929 99,558 97,963 l,275 r 7,917 l,779 r 10,454r 1,970 11,755 2,051 8,613 2,052 15,762 1,957 12,384 1,787 10,043 2,133 9,153 1,711 10,936 1,550 7,283 1,776 5,164 1,832 5,108 5,635 55 LR 827 < 68,131 75,815 67,945 73,387 75,258 86,733 67,787 86,077 61,111 62,531 55,689 5.737 1 9,413 6,384 r 13,296 6,825 15,295 6,954 11,379 7,481 17,238 6,642 15,172 6,493 15,821 6,278 15,299 5,116 15,558 5,458 10,851 6,324 7,995 6,616 8,722 2,464 2,584 2,670 3,106 2,280 1,800 3,029 4,271 3,630 1,192 1,693 1,067 1,637 1,179 2,336 6,427 2,155 1,486 2,668 9,140 2,622 1,885 3,845 11,748 2,104 1,675 3,114 8,940 2,560 1,396 3,985 10,777 2,420 1,562 3,900 13,241 3,230 2,624 3,803 13,161 2,542 2,382 4,557 11,121 3,156 3,240 5,315 17,788 2,058 1,913 2,719 11,479 2,269 1,841 2,578 8,436 1,791 2,096 2,937 7,764 50,898 FUTURES AND FORWARD TRANSACTIONS By type of deliverable security U . S . Treasury securities 17 Bills Coupon securities, by maturity L e s s than 3.5 years 18 3.5 to 7.5 years 19 7.5 to 15 years 20 15 years or more 21 Federal agency securities Debt, by maturity Less than 3.5 years 22 3.5 to 7.5 years 23 24 7.5 years or more Mortgage-backed Pass-tlu-oughs 25 Others 3 26 97 48 18 45 114 78 r 72 129 44 53 216 16 63 196 92 73 46 45 108 46 19 28 248 25 79 40 17 21 73 39 243 100 38 63 105 39 11,895 829 16,656 l,274 r 17,476 1,478 14,680 789 20,912 987 18,287 2,127 13,656 1,734 20,604 1,480 27,008 1,095 26,029 1,802 18,238 1,893 18,189 1,089 1,401 378 341 820 1,537 782 573 1,233 1,692 443 679 1,286 1,077 538 385 775 1,300 318 586 1,217 2,218 339 1,236 2,025 712 1,020 1,881 1,450 197 1,118 865 2,564 418 710 1,231 1,538 408 620 1,150 1,271 534 745 835 1,400 503 413 737 338 563 563 448 472 580 781 371 709 610 479 675 OPTIONS TRANSACTIONS 5 27 28 29 30 31 By type of underlying security U.S. Treasury, coupon securities, by maturity Less than 3.5 years 3.5 to 7.5 years 7.5 to 15 years 15 years or more Federal agency, mortgagebacked securities Pass-throughs 1. Transactions are market purchases and sales of securities as reported to the Federal Reserve Bank of N e w York by the U.S. government securities dealers on its published list of primary dealers. Averages are based on the number of trading days in the period. Immediate, forward, and futures transactions are reported at principal value, which does not include accrued interest; options transactions are reported at the face value of the underlying securities. Dealers report cumulative transactions for each week ending Wednesday. 2. Transactions for immediate delivery include purchases or sales of securities (other than mortgage-backed agency securities) for which delivery is scheduled in five business days or less and "when-issued" securities that settle on the issue date of offering. Transactions for immediate delivery of mortgage-backed agency securities include purchases and sales for which delivery is scheduled in thirty days or less. Stripped securities are reported at market value by maturity of coupon or corpus. 3. Includes such securities as collateralized mortgage obligations (CMOs), real estate mortgage investment conduits (REMICs), interest-only securities (10s), and principal-only securities (POs). 431 4. Futures transactions are standardized agreements arranged on an exchange. Forward transactions are agreements made in the over-the-counter market that specify delayed delivery. All futures transactions are included regardless of time to delivery. Forward contracts for U.S. Treasury securities and federal agency debt securities are included when the time to delivery is more than five business days. Forward contracts for mortgage-backed agency securities are included when the time to delivery is more than thirty days. 5. Options transactions are purchases or sales of put-and-call options, whether arranged on an organized exchange or in the over-the-counter market, and include options on futures contracts on U.S. Treasury and federal agency securities. NOTE. In tables 1.42 and 1.43, "n.a." indicates that data are not published because of insufficient activity. Data for several types of options transactions—U.S. Treasury securities, bills; Federal agency securities, debt; and mortgage-backed securities, other than pass-throughs—are no longer available because activity is insufficient. Federal Finance 1.43 U . S . G O V E R N M E N T SECURITIES D E A L E R S A31 Positions and Financing 1 Millions of dollars 1993, week ending 1993 1992 Item Dec. Jan. Feb. 3 Feb. Feb. 10 Feb. 17 Feb. 24 Mar. 3 Mar. 10 Mar. 17 Mar. 24 Positions N E T I M M E D I A T E POSITIONS 1 2 3 4 5 6 7 8 9 10 11 12 13 By type of security U.S. Treasury securities Bills Coupon securities, by maturity Less than 3.5 years 3.5 to 7.5 years 7.5 to 15 years 15 years or more Federal agency securities Debt, by maturity Less than 3.5 years 3.5 to 7.5 years 7.5 years or more Mortgage-backed Pass-throughs All others Other money market instruments Certificates of deposit Commercial paper Bankers acceptances 15,994 6,278 4,883 1 3,812 6,383 4,898 7,769 6,217 6,902 14,322 25 -7,221 -10,158 7,071 -4,518 -7,905 -13,562 7,040 800 -10,824 -9,682 7,126 -1,172 -7,477 -12,296 6,194 1,001 -11,500 -7,470 6,230 -3,186 -14,471 -9,376 8,957 3,014 -9,228 -10,188 6,671 5,028 -8,561 -11,245 6,988 1,793 -12,575 -8,861 9,114 -3,334 -15,080 -9,285 9,691 2,800 -15,846 -11,208 10,149 6,674 2,708 3,811 8,112 2,188 3,750 7,881 2,545 3,440 7,125 2,169 3,424 4,245 3,239 4,188 6,943 3,397 4,524 6,310 3,303 4,772 8,741 3,411 4,801 5,604 3,372 5,240 4,297 r 3,282 3,331 5,267 r 2,617 r 3,802 r 24,575 24,932 35,214 24,531 34,699 24,540 32,976 23,742 40,227 23,289 35,792 24,701 32,868 24,068 27,607 27,871 42,168 23,639 37,448 24,782 32,746 24,828 2,743 7,368 758 2,907 6,947 672 3,571 6,911 990 3,623 8,109 814 3,035 7,338 811 3,463 7,348 1,222 3,913 5,428 919 4,063 7,097 1,151 3,127 6,426 1,002 2,652 6,261 1,0% 2,987 5,883 1,247 -1,820 -4,355 -5,805 -4,422 -4,800 -5,672 -7,199 -6,392 -4,055 -4,647 -5,860 839 2,513 1,851 -3,781 1,495 844 2,811 -5,142 1,558 2,467 1,747 -3,844 1,455 3,008 1,428 -5,207 133 3,031 2,084 -2,241 -757 2,075 1,645 -2,849 -181 4,703 1,056 -4,024 166 3,729 2,453 -7,131 -394 4,474 3,616 -4,895 -50 -12 22 -1 -108 -55 38 2 117 46 29 -24 -300 -35 19 29 1 -3 0 -23 64 -295 -77 170 -303 -24 -43 -14,374 3,326 -117,589 -11,557 1,908 -70,026 -20,522 2,810 -99,094 -14,965 4,003 -112,864 -11,743 5,198 -143,753 -9,299 832 -148,110 -20,252 1,094 -141,247 -17,652 4,034 -155,743 -12,455 5,787 -167,837 FUTURES A N D FORWARD POSITIONS 14 15 16 17 18 19 20 21 22 23 24 By type of deliverable security U.S. Treasury securities Bills Coupon securities, by maturity Less than 3.5 years 3.5 to 7.5 years 7.5 to 15 years 15 years or more Federal agency securities Debt, by maturity Less than 3.5 years 3.5 to 7.5 years 7.5 years or more Mortgage-backed Pass-throughs All others Certificates of deposit 612 609 2,138 -7,258 -123 -115 -16 -1,280 366 -71,895 1,488 2,352 3,002 -6,174 -37 -11 20" -12,104 1,450 -66,597 Financing Reverse repurchase agreements 25 Overnight and continuing 26 Term 208,601 r 332,250" 230,130"^ 345,749 r 230,919 364,102 232,519 373,888 219,987 398,647 247,572 339,373 223,160 363,266 233,287 341,048 246,770 371,688 238,647 391,491 226,850 384,258 Repurchase agreements 27 Overnight and continuing 28 Term 357,327 r 326,266 r 387,080 1 328,425 r 404,809 351,505 398,4% 352,277 393,011 382,749 415,205 335,085 402,444 352,857 416,133 322,617 419,689 355,986 422,128 380,850 395,822 382,400 Securities borrowed 29 Overnight and continuing 30 Term 99,894 r 46,975 r 102,138r 52,406 r 113,700 52,467 108,787 52,082 108,642 56,900 112,995 52,575 118,472 53,055 119,119 43,779 117,135 42,739 117,945 40,464 116,661 40,793 Securities loaned 31 Overnight and continuing 32 Term 3,999 r 601 r 3,724 r 351 3,898 467 3,654 560 3,312 226 4,105 221 4,066 580 4,450 1,053 3,473 277 3,810 358 3,123 871 Collateralized loans 33 Overnight and continuing 16,800 16,882 0 0 0 0 0 0 0 0 0 MEMO: Matched book Reverse repurchase agreements 34 Overnight and continuing 35 Term 157,104r 289,665 r 166,917r 304,402 r 162,5% 318,706 169,239 326,022 154,952 349,876 171,838 294,472 156,983 319,422 164,638 299,829 167,598 324,918 164,012 337,456 154,575 335,227 Repurchase agreements 36 Overnight and continuing 37 Term 191,950r 243,216 r 218,405 r 254,15^ 222,893 271,090 226,737 278,%5 224,321 300,353 222,536 256,312 219,324 268,533 224,383 244,311 226,875 275,087 221,903 295,198 210,643 294,732 7 1. Data for positions and financing are obtained from reports submitted to the Federal Reserve Bank of N e w York by the U.S. government securities dealers on its published list of primary dealers. Weekly figures are close-of-business Wednesday data; monthly figures are averages of weekly data. 2. Securities positions are reported at market Value. 3. Net immediate positions include securities purchased or sold (other than mortgage-backed agency securities) that have been delivered or are scheduled to be delivered in five business days or less and "when-issued" securities that settle on the issue date of offering. Net immediate positions of mortgage-backed agency securities include securities purchased or sold that have been delivered or are scheduled to be delivered in thirty days or less. 4. Includes such securities as collateralized mortgage obligations (CMOs), real estate mortgage investment conduits (REMICs), interest-only securities (IOs), and principal-only securities (POs). 5. Futures positions reflect standardized agreements arranged on an exchange. Forward positions reflect agreements made in the over-the-counter market that specify delayed delivery. All futures positions are included regardless of time to delivery. Forward contracts for U.S. Treasury securities and federal agency debt securities are included when the time to delivery is more than five business days. Forward contracts for mortgage-backed agency securities are included when the time to delivery is more than thirty days. 6, Overnight financing refers to agreements made on one business day that mature on the next business day; continuing contracts are agreements that remain in effect for more than one business day but have no specific maturity and can be terminated without advance notice by either party; term agreements have a fixed maturity of more than one business day. 7. Matched-book data reflect financial intermediation activity in which the borrowing and lending transactions are matched. Matched-book data are included in the financing breakdowns given above. The reverse repurchase and repurchase numbers are not always equal because of the "matching" of securities of different values or different types of collateralization. NOTE. Data for futures and forward commercial paper and bankers acceptances and for term financing of collateralized loans are no longer available because of insufficient activity. A32 1.44 DomesticNonfinancialStatistics • June 1993 F E D E R A L A N D F E D E R A L L Y S P O N S O R E D CREDIT A G E N C I E S Debt Outstanding Millions of dollars, end of period 1992 1988 Agency 1 Federal and federally sponsored agencies 2 Federal agencies 3 Defense Department 4 Export-Import Bank 2,3 5 Federal Housing Administration Government National Mortgage Association certificates of 6 participation 7 Postal Service 6 Tennessee Valley Authority 8 9 United States Railway Association 10 Federally sponsored agencies 7 11 Federal Home Loan Banks 12 Federal Home Loan Mortgage Corporation 13 Federal National Mortgage Association 14 Farm Credit Banks 8 Student Loan Marketing Association 9 15 Financing Corporation 16 17 Farm Credit Financial Assistance Corporation 18 Resolution Funding Corporation 1990 1989 1993 1991 Sept. Oct. Nov. Dec. Jan. 381,498 411,805 434,668 442,772 475,606 479,978 481,050 483,970 0 35,668 8 11,033 150 35,664 7 10,985 328 42,159 7 11,376 393 41,035 7 9,809 397 41,319 7 7,698 301 41,470 7 7,698 309 42,081 7 7,698 344 41,829 7 7,208 374 41,641 7 7,208 231 0 6,142 18,335 0 0 6,445 17,899 0 0 6,948 23,435 0 0 8,421 22,401 0 0 10,123 23,190 0 0 10,123 23,333 0 0 10,660 23,372 0 0 10,660 23,580 0 0 10,660 23,535 0 345,832 135,836 22,797 105,459 53,127 22,073 5,850 690 0 375,428 136,108 26,148 116,064 54,864 28,705 8,170 847 4,522 392,509 117,895 30,941 123,403 53,590 34,194 8,170 1,261 23,055 401,737 107,543 30,262 133,937 52,199 38,319 8,170 1,261 29,9% 434,287 110,830 36,750 155,232 52,734 38,830 8,170 1,261 29,9% 438,508 112,436 34,108 159,764 52,510 39,766 8,170 1,261 29,9% 438,%9 114,364 30,914 161,308 52,728 39,737 8,170 1,261 29,9% 442,141 114,733 29,631 166,300 51,910 39,650 8,170 1,261 29,9% 0 113,253 34,479 165,958 52,264 39,812 8,170 1,261 29,9% 142,850 134,873 179,083 185,576 164,422 159,899 156,579 154,994 151,059 11,027 5,892 4,910 16,955 0 10,979 6,195 4,880 16,519 0 11,370 6,698 4,850 14,055 0 9,803 8,201 4,820 10,725 0 7,692 9,903 4,820 7,175 0 7,692 9,903 4,790 7,175 0 7,692 10,440 4,790 6,975 0 7,202 10,440 4,790 6,975 0 7,202 10,440 4,790 6,825 0 58,496 19,246 26,324 53,311 19,265 23,724 52,324 18,890 70,896 48,534 18,562 84,931 42,979 18,143 73,710 42,979 18,172 69,188 42,979 18,172 65,531 42,979 18,172 64,436 42,979 18,037 60,786 MEMO 19 Federal Financing Bank debt 1 20 21 22 23 24 Lending to federal and federally sponsored Export-Import Bank Postal Service 6 Student Loan Marketing Association Tennessee Valley Authority United States Railway Association Other lending14 25 Farmers Home Administration 26 Rural Electrification Administration 27 Other agencies 1. Consists of mortgages assumed by the Defense Department between 1957 and 1963 under family housing and homeowners assistance programs. 2. Includes participation certificates reclassified as debt beginning Oct. 1,1976. 3. On-budget since Sept. 30, 1976. 4. Consists of debentures issued in payment of Federal Housing Administration insurance claims. Once issued, these securities may be sold privately on the securities market. 5. Certificates of participation issued before fiscal year 1969 by the Government National Mortgage Association acting as trustee for the Farmers Home Administration, the Department of Health, Education, and Welfare, the Department of Housing and Urban Development, the Small Business Administration, and the Veterans' Administration. 6. Off-budget. 7. Includes outstanding noncontingent liabilities: notes, bonds, and debentures. Some data are estimated. 8. Excludes borrowing by the Farm Credit Financial Assistance Corporation, shown on line 17. 9. Before late 1982, the Association obtained financing through the Federal Financing Bank (FFB). Borrowing excludes that obtained from the FFB, which is shown on line 22. 10. The Financing Corporation, established in August 1987 to recapitalize the Federal Savings and Loan Insurance Corporation, undertook its first borrowing in October 1987. 11. The Farm Credit Financial Assistance Corporation, established in January 1988 to provide assistance to the Farm Credit System, undertook its first borrowing in July 1988. 12. The Resolution Funding Corporation, established by the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, undertook its first borrowing in October 1989. 13. The FFB, which began operations in 1974, is authorized to purchase or sell obligations issued, sold, or guaranteed by other federal agencies. Because FFB incurs debt solely for the purpose of lending to other agencies, its debt is not included in the main portion of the table in order to avoid double counting. 14. Includes FFB purchases of agency assets and guaranteed loans; the latter are loans guaranteed by numerous agencies, with the amounts guaranteed by any one agency generally being small. The Fanners Home Administration entry consists exclusively of agency assets, while the Rural Electrification Administration entry consists of both agency assets and guaranteed loans. Securities Market and Corporate Finance 1.45 N E W SECURITY I S S U E S A33 Tax-Exempt State and Local Governments Millions of dollars 1993 1992 Type of issue or issuer, or use 1990 1 AU issues, new and refunding 1 1991 1992 Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. 120,339 154,402 215,191 19,774 18,698 21,092 14,133 19,577 17,981" 17,793 27,471 By type of issue 2 General obligation 3 Revenue 39,610 81,295 55,100 99,302 78,611 136,580 7,005 12,769 7,461 11,237 7,733 13,359 5,203 8,930 6,024 13,553 4,840" 13,141" 6,963 10,830 8,254 19,217 By type of issuer 4 State 5 Special district or statutory authority 6 Municipality, county, or township 15,149 72,661 32,510 24,939 80,614 48,849 25,295 127,618 60,210 2,933 11,203 5,638 1,710 11,054 5,934 2,742 13,113 5,237 1,688 8,197 4,248 2,339 11,159 6,079 1,339 12,556 3,994 3,485 n.a. 4,654 2,139 n.a. 6,977 103,235 116,953 120,272 11,993 10,496 13,760 8,028 8,010 5,875 4,636 9,716 17,042 11,650 11,739 23,099 6,117 34,607 21,121 13,395 21,039 25,648 8,376 30,275 22,071 17,334 20,058 21,796 5,424 33,589 1,737 2,130 2,604 767 503 4,252 1,237 1,977 2,265 1,869 1,176 1,972 2,083 1,364 3,340 2,365 367 4,241 1,800 531 960 1,070 581 3,086 1,658 831 1,258 1,121 339 2,803 1,033" 829" 894" 777 337 2,005 1,264 131 423 618 69 2,131 1,482 2,111 538 1,556 765 3,264 7 Issues for new capital 8 9 10 11 12 13 By use of proceeds Education Transportation Utilities and conservation Social welfare Industrial aid Other purposes 1. Par amounts of long-term issues based on date of sale. 2. Includes school districts. 1.46 N E W SECURITY I S S U E S SOURCES. Securities Data Company beginning January 1993. Dealer's Digest for earlier data. Investment U . S . Corporations Millions of dollars 1993 1992 Type of issue, offering, or issuer 1990 1991 1992 July Aug. Sept. Oct. Nov. Dec. Jan. Feb. 1 All issues 1 340,049 465,483 n.a. 46,235 37,091 42,849 39,280" 35,525" 39,424 50,793 59,403 2 Bonds 2 299,884 390,018 404,992 39,758 31,815 37,539 32,314" 31,026" 33,375 45,559 49,343 By type of offering 3 Public, domestic 4 Private placement, domestic 5 Sold abroad 188,848 86,982 23,054 287,125 74,930 27,962 377,453 n.a. 27,539 37,833 n.a. 1,924 28,561 n.a. 3,254 36,185 n.a. 1,355 30,249 n.a. 2,066" 28,774" n.a. 2,252" 31,835 n.a. 1,540 41,675 n.a. 3,884 47,165 n.a. 2,178 51,779 40,733 12,776 17,621 6,687 170,288 86,628 36,666 13,598 23,945 9,431 219,750 69,538 30,049 6,497 44,643 13,073 241,192 5,509 3,488 766 6,902 2,081 21,011 4,720 2,159 393 4,509 1,053 18,982 5,974 2,374 677 5,230 1,191 22,093 7,975 2,813 290 3,700 427 17,110" 3,467 2,396" 0 1,289 374 23,499" 4,232 2,176 611 2,867 516 22,973 9,393 3,074 316 4,282 3,019 25,475 8,080 2,268 248 5,624 2,890 30,234 12 Stocks 2 40,165 75,467 n.a. 6,477 5,276 5,310 6,966 4,499 6,049 5,234 10,060 By type of offering 13 Public preferred 14 Common 15 Private placement 3 n.a. n.a. 16,736 17,408 47,860 10,109 21,332 57,099 n.a. 2,413 4,064 n.a. 1,148 4,129 n.a. 1,233 4,077 n.a. 2,901 4,065 n.a. 1,540 2,958 n.a. 1,608 4,441 n.a. 1,112 4,122 n.a. 1,898 8,161 n.a. 5,649 10,171 369 416 3,822 19,738 24,154 19,418 2,439 3,474 475 25,507 n.a. n.a. n.a. n.a. n.a. n.a. 857 1,599 n.a. 564 n.a. 3,457 713 1,315 n.a. 921 n.a. 2,327 307 602 59 595 1,051 2,695 1,779 940 53 359 99 3,735 288 1,366 304 150 22 2,369 1,468 2,226 118 92 126 2,019 722 1,688 65 310 0 2,438 2,616 2,021 64 350 0 5,009 6 7 8 9 10 11 16 17 18 19 70 21 By industry group Manufacturing Commercial and miscellaneous Transportation Public utility Communication Real estate and financial By industry group Manufacturing Commercial and miscellaneous Transportation Public utility Communication Real estate and financial 1. Figures represent gross proceeds of issues maturing in more than one year; they are the principal amount or number of units calculated by multiplying by the offering price. Figures exclude secondary offerings, employee stock plans, investment companies other than closed-end, intracorporate transactions, equities sold abroad, and Yankee bonds. Stock data include ownership securities issued by limited partnerships. 2. Monthly data cover only public offerings. 3. Monthly data are not available. SOURCES. IDD Information Services, Inc., the Board of Governors of the Federal Reserve System, and, before 1989, the U.S. Securities and Exchange Commission. A34 DomesticNonfinancialStatistics • June 1993 1.47 OPEN-END INVESTMENT COMPANIES N e t Sales and-Assets Millions of dollars 1992 1991r Item 1 1993 1992 July Aug. Sept. Oct. Nov. Dec. r Jan. Feb. 1 Sales of own shares 2 463,645 647,055 54,915 50,627 50,039 52,214 52,019 70,618 71,607 60,716 2 Redemptions of own shares 3 Net sales 3 342,547 121,098 447,140 199,915 34,384 20,703 35,223 15,404 37,862 12,177 37,134 15,080 34,126 17,893 51,993 18,625 46,545 25,062 39,686 21,030 4 Assets 4 808,582 1,056,310 951,806 957,145 978,507 983,151 1,019,618 1,056,310 1,082,653 1,116,652 5 Cash 5 6 Other 60,292 748,290 73,999 982,311 72,732 879,074 77,245 879,900 76,498 902,009 75,808 907,343 80,247 939,371 73,999 982,311 76,764 1,005,889 80,321 1,036,331 4. Market value at end of period, less current liabilities. 5. Includes all U . S . Treasury securities and other short-term debt securities. SOURCE. Investment Company Institute. Data based on reports of membership, which comprises substantially all open-end investment companies registered with the Securities and Exchange Commission. Data reflect underwritings of new companies. 1. Data on sales and redemptions exclude money market mutual funds but include limited-maturity municipal bond funds. Data on assets exclude both money market mutual ftmds and limited-maturity municipal bond funds. 2. Includes reinvestment of dividends. Excludes reinvestment of capital gains distributions. 3. Excludes sales and redemptions resulting from transfers of shares into or out of money market mutual funds within the same fund family. 1.48 CORPORATE PROFITS A N D THEIR DISTRIBUTION B i l l i o n s o f d o l l a r s ; q u a r t e r l y d a t a at s e a s o n a l l y a d j u s t e d a n n u a l r a t e s 1991 1990 Account 1991 1992 1992 Q1 Q2 Q3 Q4 Ql Q2 Q3 Q4 r 1 Profits with inventory valuation and capital consumption adjustment 2 Profits before taxes 3 Profits tax liability 4 Profits after taxes 5 Dividends 6 Undistributed profits 361.7 355.4 136.7 218.7 149.3 69.4 346.3 334.7 124.0 210.7 146.5 64.2 394.5 372.3 140.5 231.8 149.3 r 82.5 349.6 337.6 121.3 216.3 150.6 65.7 347.3 332.3 122.9 209.4 146.2 63.2 341.2 336.7 127.0 209.6 145.1 64.5 347.1 332.3 125.0 207.4 143.9 63.4 384.0 366.1 136.4 229.7 143.6 86.2 388.4 376.8 144.1 232.7 146.6 86.1 374.1 354.1 131.8 222.2 151.1 71.1 428.5 389.4 148.5 241.0 155.9 r 85.0 7 Inventory valuation 8 Capital consumption adjustment -14.2 20.5 3.1 8.4 -7.4r 29.5 r 6.7 5.3 9.9 5.1 -4.8 9.3 .7 14.1 -5.4 23.3 -15.5 27.0 -9.7 29.7 1.0 38.1 SOURCE. U.S. Department of Commerce, Survey of Current 1.50 Business. NONFARM BUSINESS EXPENDITURES o n N e w Plant and Equipment B i l l i o n s o f d o l l a r s ; q u a r t e r l y d a t a at s e a s o n a l l y a d j u s t e d a n n u a l r a t e s 1991 Industry 1991 1992 1992 1993 19931 Q3 Q4 Ql Q2 Q3 Q4 Ql Q2 1 1 Total nonfarm business 528.39 546.08 582.31 526.59 529.87 535.72 540.91 547.53 560.16 571.41 578.15 Manufacturing 2 Durable goods industries 3 Nondurable goods industries 77.64 105.17 73.41 100.50 77.11 106.24 74.94 102.55 76.40 102.66 74.19 99.79 74.26 97.52 71.84 100.39 73.34 104.28 80.68 103.01 77.62 103.48 Nonmanufacturing 4 Mining Transportation 5 Railroad 6 Air 7 Other Public utilities 8 Electric 9 Gas and other 10 Commercial and o t h e r 10.02 8.90 9.32 10.09 9.99 8.87 9.18 9.09 8.44 9.52 9.49 5.95 10.17 6.54 6.77 8.97 7.04 7.36 7.10 8.60 6.32 9.61 6.63 5.44 10.41 6.45 6.65 8.86 6.37 6.50 9.75 7.27 6.87 10.13 7.69 7.08 7.13 6.84 6.26 7.36 8.07 7.71 9.10 7.51 43.76 22.82 246.32 48.05 23.91 268.54 53.32 24.08 289.18 43.27 23.25 249.94 44.75 22.67 251.11 46.06 22.75 262.17 48.45 24.19 263.80 47.73 23.92 269.86 49.95 24.78 278.32 52.61 23.46 280.44 53.05 24.22 285.98 1. Figures are amounts anticipated by business. 2. "Other" consists of construction, wholesale and retail trade, finance and insurance, personal and business services, and communication. SOURCE. U.S. Department of Commerce, Survey of Current Business. Securities Markets and Corporate Finance 1.51 A35 Assets and Liabilities 1 DOMESTIC FINANCE COMPANIES Billions of dollars, end of period; not seasonally adjusted 1992 1991 Account 1990 1992 1991 Q2 Q3 Q4 Qi Q2 Q3 Q4 ASSETS 492.9 133.9 293.5 65.5 480.3 121.9 292.6 65.8 482.1 117.1 296.5 68.4 488.5 127.5 295.2 65.7 484.7 125.3 293.2 66.2 480.3 121.9 292.6 65.8 475.7 118.4 291.6 65.8 476.8 r 116.7 293.7 r 66.4 475.8 116.6 291.1 68.1 482.1 117.1 296.5 68.4 57.6 9.6 55.1 12.9 50.8 15.8 58.0 11.1 57.6 13.1 55.1 12.9 53.6 13.0 51.2 12.3 50.8 12.0 50.8 15.8 7 Accounts receivable, net 8 All other 425.7 113.9 412.3 149.0 415.5 150.6 419.3 122.8 414.1 136.4 412.3 149.0 409.1 145.5 413.3 r 139.4 412.9 146.5 415.5 150.6 9 539.6 561.2 566.1 542.1 550.5 561.2 554.6 552.7r 559.4 566.1 31.0 165.3 42.3 159.5 37.6 156.4 36.9 156.1 39.6 156.8 42.3 159.5 38.0 154.4 37.8 147.7 38.1 153.2 37.6 156.4 15 N o t elsewhere classified 16 All other liabilities 17 Capital, surplus, and undivided profits n.a. n.a. 37.5 178.2 63.9 63.7 n.a. n.a. 34.5 191.3 69.0 64.8 n.a. n.a. 37.8 195.3 71.2 67.8 n.a. n.a. 34.2 184.5 67.1 63.3 n.a. n.a. 36.5 185.0 68.8 63.8 n.a. n.a. 34.5 191.3 69.0 64.8 n.a. n.a. 34.5 189.8 72.0 66.0 n.a. n.a. 34.8 191.9 73.4 67.1 n.a. n.a. 34.9 191.4 73.7 68.1 n.a. n.a. 37.8 195.3 71.2 67.8 18 Total liabilities and capital 539.6 561.2 566.1 542.1 550.5 561.2 554.6 552.7R 559.4 566.1 1 Accounts receivable, gross 2 ? 3 4 Real estate 5 LESS; Reserves for unearned income Reserves for losses 6 LIABILITIES AND CAPITAL 10 11 Commercial paper Debt 12 Other short-term 13 14 O w e d to parent 1. Includes finance company subsidiaries of bank holding companies but not of retailers and banks. Data are amounts carried on the balance sheets o f finance companies; securitized pools are not shown since they are not on the books. DOMESTIC FINANCE COMPANIES 1 1.52 2. Before deduction for unearned income and losses, Consumer, Real Estate, and Business Credit Millions of dollars, amounts outstanding, end of period 1993 1992 Type o f credit 1990 1991 1992 r Sept. Oct. Dec.r Jan. Feb. 529,232 531,864 526,254 528,395 156,593 67,838 304,801 157,707 68,011 306,146 156,551 68,942 300,761 157,733 70,016 300,646 Nov. Seasonally adjusted 1 Total 2 Consumer.. 3 Real estate 2 4 Business . . . 523,023 161,070 65,147 296,807 519,573 154,786 65,388 299,400 531,864 157,707 68,011 306,146 527,858 155,618 67,717 304,523 527,323 154,501 68,035 304,787 N o t seasonally adjusted 5 Total 6 Consumer 7 Motor vehicles 8 Other consumer 3 9 Securitized motor v e h i c l e s 4 . 10 Securitized other consumer 11 Real estate 2 12 Business 13 Motor vehicles 14 Retail5..., 15 Wholesale 6 16 Leasing 17 Equipment 18 Retail...., 19 Wholesale 6 20 Leasing * 21 Other business 7 22 Securitized business assets . 23 Retail 24 Wholesale 25 Leasing 526,441 522,853 535,158 524,999 526,874 528,895 535,158 525,847 525,490 161,965 75,045 58,818 19,837 8,265 65,509 298,967 92,072 26,401 33,573 32,098 137,654 31,968 11,101 94,585 63,774 5,467 667 3,281 1,519 155,677 63,413 58,488 23,166 10,610 65,764 301,412 90,319 22,507 31,216 36,596 141,399 30,962 9,671 100,766 60,887 8,807 576 5,285 2,946 158,631 57,605 59,522 29,775 11,729 68,410 308,118 87,456 19,303 27,158 38,191 151,607 32,212 8,669 110,726 57,464 11,590 1,118 5,756 4,716 156,416 59,806 56,808 28,204 11,598 68,064 300,519 85,261 20,407 n.a. 39,506 147,319 31,571 8,994 106,754 58,493 9,447 152 5,378 3,917 155,505 59,290 57,013 27,823 11,379 68,477 302,892 86,747 20,763 n.a. 39,536 147,146 31,475 8,928 106,743 58,898 10,101 634 5,593 3,874 157,005 58,286 58,128 28,964 11,626 68,016 303,875 85,621 19,708 n.a. 39,020 148,202 31,427 8,824 107,952 59,269 10,782 607 5,813 4,362 158,631 57,605 59,522 29,775 11,729 68,410 308,118 87,456 19,303 n.a. 38,191 151,607 32,212 8,669 110,726 57,464 11,590 1,118 5,756 4,716 156,430 57,165 58,844 28,894 11,527 68,889 300,527 86,491 19,124 n.a. 38,640 146,820 32,458 8,582 105,780 55,760 11,457 1,036 5,582 4,839 155,929 54,036 58,651 32,860 10,383 69,216 300,345 86,412 17,881 n.a. 38,472 145,886 32,430 8,318 105,138 55,962 12,085 973 6,408 4,704 1. Includes finance company subsidiaries of bank holding companies but not of retailers and banks. Data are before deductions for unearned income and losses. Data in this table also appear in the Board's G.20 (422) monthly statistical release. For ordering address, see inside front cover. 2. Includes all loans secured by liens on any type of real estate, for example, first and junior mortgages and home equity loans. 3. Includes personal cash loans, mobile home loans, and loans to purchase other types o f consumer goods such as appliances, apparel, general merchandise, and recreation vehicles. 4. Outstanding balances of pools upon which securities have been issued; these FRASER balances are no longer carried on the balance sheets of the loan originator. Digitized for 5. Passenger car fleets and commercial land vehicles for which licenses are required. 6. Credit arising from transactions between manufacturers and dealers, that is, floor plan financing. 7. Includes loans on commercial accounts receivable, factored commercial accounts, and receivable dealer capital; small loans used primarily for business or farm purposes; and wholesale and lease paper for mobile homes, campers, and travel trailers. A36 1.53 DomesticNonfinancialStatistics • June 1993 MORTGAGE M A R K E T S Conventional Mortgages on N e w Homes Millions of dollars except as noted 1992 Item 1990 1991 1993 1992 Sept. Oct. Nov. Dec. Jan. Feb. Mar. Terms and yields in primary and secondary markets PRIMARY M A R K E T S 1 2 3 4 5 6 Terms1 Purchase price (thousands of dollars) Amount of loan (thousands of dollars) Loan-price ratio (percent) Maturity (years) Fees and charges (percent of loan amount) Contract rate (percent per year) Yield (percent per 7 OTS series 3 8 H U D series 4 153.2 112.4 74.8 27.3 1.93 9.68 155.0 114.0 75.0 26.8 1.71 9.02 158.1 118.1 76.6 25.6 1.60 7.98 146.0 109.3 77.0 25.7 1.52 7.68 159.2 119.7 77.3 25.2 1.42 7.65 165.4 117.3 75.3 24.9 1.54 7.81 154.0 117.7 77.7 26.1 1.31 7.65 158.6 119.5 76.8 25.7 1.49 7.57 159.7 114.5 75.4 23.8 1.43 7.52 156.2 121.5 79.3 26.9 1.50 7.22 10.01 10.08 9.30 9.20 8.25 8.43 7.93 7.95 7.90 8.29 8.07 8.38 7.88 8.19 7.82 7.93 7.77 7.63 7.46 7.59 10.17 9.51 9.25 8.59 8.46 7.77 8.06 7.31 8.29 7.53 8.54 7.90 8.12 7.57 8.04 7.39 7.55 7.02 7.57 6.79 year) SECONDARY M A R K E T S field (percent per year) 9 F H A mortgages ( H U D series) 5 10 G N M A securities 6 Activity in secondary markets F E D E R A L N A T I O N A L MORTGAGE ASSOCIATION Mortgage holdings (end of 11 Total 12 FHA/VA-insured 13 Conventional Mortgage transactions 14 Purchases Mortgage 15 Issued 16 To sell 9 commitments period) (during (during 113,329 21,028 92,302 122,837 21,702 101,135 142,833 22,168 120,664 144,904 22,275 122,629 149,133 22,399 126,734 153,306 22.372 130,934 158,119 22,593 135,526 159,204 22,640 136,564 159,766 22,573 137,193 161,147 22,700 138,447 23,959 37,202 75,905 6,779 8,380 7,980 8,832 4,993 4,118 4,730 23,689 5,270 40,010 7,608 74,970 10,493 8,880 148 8,195 0 6,084 237 6,185 1,811 4,189 1,159 4,177 221 6,644 0 20,419 547 19,871 24,131 484 23,283 29,959 408 29,552 31,629 371 31,259 32,995 365 32,630 32,703 359 32,343 33,665 352 33,313 32,370 347 32,023 32,454 343 32,112 35,421 337 35,084 75,517 73,817 97.727 92,478 191,125 179,208 16,391 14,267 20,199 18,771 19,607 19,154 20,792 19,602 15,512 16,536 12,063 12,105 12,587 10,286 102,401 114,031 261,637 17,132 27,380 29,717 32,453 17,591 23,366 21,103 period) period)1 F E D E R A L H O M E L O A N MORTGAGE CORPORATION Mortgage holdings (end of 17 Total 18 FHA/VA-insured 19 Conventional Mortgage transactions 20 Purchases 21 Mortgage commitments 22 Contracted periodf (during (during period) period)10 1. Weighted averages based on sample surveys of mortgages originated by major institutional lender groups; compiled by the Federal Housing Finance Board in cooperation with the Federal Deposit Insurance Corporation. 2. Includes all fees, commissions, discounts, and "points" paid (by the borrower or the seller) to obtain a loan. 3. Average effective interest rates on loans closed, assuming prepayment at the end of ten years; from Office of Thrift Supervision (OTS). 4. Average contract rates on new commitments for conventional first mortgages; from U.S. Department of Housing and Urban Development (HUD). 5. Average gross yields on thirty-year, minimum-downpayment, first mortgages insured by the Federal Housing Administration (FHA) for immediate delivery in the private secondary market. Based on transactions on first day of subsequent month. Large monthly movements of average yields may reflect market adjustments to changes in maximum permissible contract rates. 6. Average net yields to investors on fully modified pass-through securities backed by mortgages and guaranteed by the Government National Mortgage Association (GNMA), assuming prepayment in twelve years on pools of thirtyyear mortgages insured by the Federal Housing Administration or guaranteed by the Department of Veterans Affairs carrying the prevailing ceiling rate. Monthly figures are averages of Friday figures from the Wall Street Journal. 1. Includes some multifamily and nonprofit hospital loan commitments in addition to one- to four-family loan commitments accepted in the Federal National Mortgage Association's (FNMA's) free market auction system, and through the FNMA-GNMA tandem plans. 8. Does not include standby commitments issued, but includes standby commitments converted. 9. Includes participation loans as well as whole loans. 10. Includes conventional and government-underwritten loans. The Federal Home Loan Mortgage Corporation's mortgage commitments and mortgage transactions include activity under mortgage securities swap programs, while the corresponding data for F N M A exclude swap activity. Real Estate 1.54 A37 MORTGAGE D E B T O U T S T A N D I N G 1 Millions of dollars, end of period 1992 1991 Type of holder and property 1989 1990 1991 Q4 Ql Q2 Q3 3,570,906 3,795,210 3,915,871 3,915,871 3,938,198 3,976,483 4,012,983 2,424,258 307,672 754,952 84,025 2,635,428 311,113 764,953 83,716 2,764,447 310,427 758,063 82,934 2,764,447 310,427 758,063 82,934 2,790,734 310,499 754,290 82,674 2,838,732 306,038 748,4% 83,218 2,890,842 305,379 733,083 83,679 1,931,537 767,069 389,632 38,876 321,906 16,656 910,254 669,220 106,014 134,370 650 254,214 12,231 26,907 205,472 9,604 1,914,315 844,826 455,931 37,015 334,648 17,231 801,628 600,154 91,806 109,168 500 267,861 13,005 28,979 215,121 10,756 1,846,910 876,284 486,572 37,424 333,852 18,436 705,367 538,358 79,881 86,741 388 265,258 11,547 29,562 214,105 10,044 1,846,910 876,284 486,572 37,424 333,852 18,436 705,367 538,358 79,881 86,741 388 265,258 11,547 29,562 214,105 10,044 1,825,983 880,377 492,910 37,710 330,837 18,919 682,338 524,536 77,166 80,278 358 263,269 11,214 29,693 212,865 9,497 1,803,488 884,598 496,518 38,314 330,229 19,538 659,624 508,545 74,788 75,947 345 259,266 10,676 29,425 210,139 9,026 1,793,505 891.484 506,658 38.985 325,934 19,906 648,178 501,604 73,723 72,517 334 253,843 10,451 28.804 205,709 8,878 22 Federal and related agencies 23 Government National Mortgage Association 24 One- to four-family 25 Multifamily 26 Farmers Home Administration 27 One- to four-family 28 Multifamily 29 Commercial 30 Farm 31 Federal Housing and Veterans' Administrations 32 One- to four-family 33 Multifamily 34 Resolution Trust Corporation 35 One- to four-family 36 Multifamily 37 Commercial 38 Farm 39 Federal National Mortgage Association 40 One- to four-family 41 Multifamily 42 Federal Land Banks 43 One- to four-family 44 Farm 45 Federal Home Loan Mortgage Corporation 46 One- to four-family 47 Multifamily 197,778 23 23 0 41,176 18,422 9,054 4,443 9,257 6,087 2,875 3,212 0 0 0 0 0 99,001 90,575 8,426 29,640 1,210 28,430 21,851 18,248 3,603 239,003 20 20 0 41,439 18,527 9,640 4,690 8,582 8,801 3,593 5,208 32,600 15,800 8,064 8,736 0 104,870 94,323 10,547 29,416 1,838 27,577 21,857 19,185 2,672 266,156 19 19 0 41,713 18,496 10,141 4,905 8,171 10,733 4,036 6,697 45,822 14,535 15,018 16,269 0 112,283 100,387 11,896 28,777 1,693 27,084 26,809 24,125 2,684 266,156 19 19 0 41,713 18,496 10,141 4,905 8,171 10,733 4,036 6,697 45,822 14,535 15,018 16,269 0 112,283 100,387 11,896 28,777 1,693 27,084 26,809 24,125 2,684 278,3% 19 19 0 41,791 18,488 10,270 4,961 8,072 11,332 4,254 7,078 49,345 15,458 16,266 17,621 0 118,238 105,869 12,369 28,776 1,693 27,083 28,895 26,182 2,713 278,131 23 23 277.485 27 27 41,628 17,718 10,356 4,998 8.557 11,480 4,403 7,077 44,624 15,032 13,316 16,276 41,671 17,292 10,468 5,072 8,839 11,768 4,531 7,236 37,099 12,614 11,130 13,356 122,979 110,223 12,756 28,775 1,693 27,082 28,621 26,001 2,620 126,476 113,407 13,069 28,815 1,695 27,119 31,629 29,039 2,591 48 Mortgage pools or trusts 5 49 Government National Mortgage Association 50 One- to four-family 51 Multifamily 52 Federal Home Loan Mortgage Corporation 53 One- to four-family 54 Multifamily 55 Federal National Mortgage Association 56 One- to four-family 57 Multifamily 58 Farmers Home Administration 4 59 One- to four-family 60 Multifamily 61 Commercial 62 Farm 63 Private mortgage conduits 64 One- to four-family 65 Multifamily 66 Commercial 67 Farm 951,740 368,367 358,142 10,225 272,870 266,060 6,810 228,232 219,577 8,655 80 21 0 26 33 82,191 77,217 462 4,512 0 1,116,452 403,613 391,505 12,108 316,359 308,369 7,990 299,833 291,194 8,639 66 17 0 24 26 96,581 90,684 731 5,166 0 1,270,862 425,295 415,767 9,528 359,163 351,906 7,257 371,984 362,667 9,317 47 11 0 19 17 114,373 104,1% 3,698 6,479 0 1,270,862 425,295 415,767 9,528 359,163 351,906 7,257 371,984 362,667 9,317 47 11 0 19 17 114,373 104,1% 3,698 6,479 0 1,288,823 421,977 412,574 9,404 367,878 360,887 6,991 389,853 380,617 9,236 43 10 0 18 16 109,071 95,600 4,686 8,784 0 1,341,338 422,922 413,828 9,094 382,797 376,177 6,620 413,226 403,940 9,286 43 9 1,385,460 422,255 413,063 9,192 391,762 385,400 6,362 429,535 420,835 9,100 41 9 18 15 122,350 105,700 5,7% 10,855 18 14 141,468 123,000 5,7% 12,673 489,851 300,805 85,427 84,224 19,395 525,440 331,282 87,713 87,400 19,045 531,943 330,131 87,324 95,693 18,795 531,943 330,131 87,324 95,693 18,795 544,9% 340,424 86,917 98,925 18,730 553,526 348,245 86,591 100,035 18,656 556,532 351,217 88,922 97.805 18,588 1 AU holders 2 3 4 5 By type of property One- to four-family residences Multifamily residences Commercial Farm By type of holder 6 Major financial institutions 7 Commercial banks 8 One- to four-family 9 Multifamily 10 Commercial 11 Farm 12 Savings institutions 13 One- to four-family 14 Multifamily 15 Commercial 16 Farm 17 Life insurance companies 18 One- to four-family 19 Multifamily 20 Commercial 21 Farm 68 Individuals and others 69 One- to four-family 70 Multifamily 71 Commercial 72 Farm 6 1. Based on data from various institutional and governmental sources; figures for some quarters estimated in part by the Federal Reserve. Multifamily debt refers to loans on structures of five or more units. 2. Includes loans held by nondeposit trust companies but not loans held by bank trust departments. 3. Includes savings banks and savings and loan associations. 4. FmHA-guaranteed securities sold to the Federal Financing Bank were reallocated from FmHA mortgage pools to FmHA mortgage holdings in 1986:4 because of accounting changes by the Farmers Home Administration. 0 0 0 0 0 0 0 0 5. Outstanding principal balances of mortgage-backed securities insured or guaranteed by the agency indicated. 6. Other holders include mortgage companies, real estate investment trusts, state and local credit agencies, state and local retirement funds, noninsured pension funds, credit unions, and finance companies. A38 DomesticNonfinancialStatistics • June 1993 C O N S U M E R I N S T A L L M E N T CREDIT 1 1.55 Millions of dollars, amounts outstanding, end of period 1992 Holder and type of credit 1990 1993 1992r 1991 Sept. Oct. Nov. Dec. r Jan. Feb. Seasonally adjusted 1 Total 735,338 727,799 726,653 722,104 722,372 723,448 726,653 727,647 728,815 2 Automobile 3 Revolving.. 4 Other 284,993 222,950 227,395 263,003 242,785 222,012 260,097 251,258 215,298 257,384 250,017 214,703 256,846 250,454 215,071 257,740 250,620 215,088 260,097 251,258 215,298 259,720 252,785 215,143 260,763 255,177 212,876 Not seasonally adjusted 5 Total 748,524 742,058 741,381 724,198 722,760 725,178 741,381 732,490 726,265 347,087 133,863 93,057 44,822 46,969 4,822 77,904 339,565 121,901 92,254 44,030 40,315 4,362 99,631 329,603 117,086 92,648 44,952 33,861 4,365 118,866 324,046 116,650 92,698 38,778 35,069 4,499 112,458 324,697 116,304 92,228 39,299 34,148 4,452 111,632 324,529 116,414 91,838 39,539 34,171 4,365 114,322 329,603 117,086 92,648 44,952 33,861 4,365 118,866 326,807 116,059 92,381 42,585 33,902 4,366 116,390 324,358 112,687 91,777 40,671 33,754 4,148 118,870 By major type of credit3 13 Automobile 14 Commercial banks 15 Finance companies Pools of securitized assets 16 285,050 124,913 75,045 24,428 263,108 111,912 63,413 28,057 260,227 108,581 57,604 33,593 260,395 108,355 59,806 31,971 259,055 108,068 59,290 31,757 258,539 107,675 58,286 32,672 260,227 108,581 57,604 33,593 258,473 108,432 57,165 32,388 258,833 108,580 54,036 35,930 17 Revolving 18 Commercial banks Retailers 19 20 Gasoline companies Pools of securitized assets 2 21 235,056 133,385 40,003 4,822 44,335 255,895 137,968 39,352 4,362 60,139 264,801 132,921 40,064 4,365 72,695 248,692 127,234 34,148 4,499 68,252 248,526 127,257 34,654 4,452 67,699 251,422 128,164 34,857 4,365 69,415 264,801 132,921 40,064 4,365 72,695 257,992 129,056 37,719 4,366 71,927 254,258 127,252 35,815 4,148 72,024 22 Other Commercial banks 23 24 Finance companies Retailers 25 Pools of securitized assets 2 26 228,418 88,789 58,818 4,819 9,141 223,055 89,685 58,488 4,678 11,435 216,353 88,101 59,482 4,888 12,578 215,111 88,457 56,844 4,630 12,235 215,179 89,372 57,014 4,645 12,176 215,217 88,690 58,128 4,682 12,235 216,353 88,101 59,482 4,888 12,578 216,025 89,319 58,894 4,866 12,075 213,174 88,526 58,651 4,856 10,916 6 7 8 9 10 11 12 By major holder Commercial banks Finance companies Credit unions Retailers Savings institutions Gasoline companies Pools of securitized assets 2 1. The Board's series on amounts of credit covers most short- and intermediate-term credit extended to individuals that is scheduled to be repaid (or has the option of repayment) in two or more installments. Data in this table also appear in the Board's G.19 (421) monthly statistical release. For ordering address, see inside front cover. 1.56 2. Outstanding balances of pools upon which securities have been issued; these balances are no longer carried on the balance sheets of the loan originator. 3. Totals include estimates for certain holders for which only consumer credit totals are available. TERMS OF C O N S U M E R I N S T A L L M E N T CREDIT 1 Percent per year except as noted 1992 Item 1990 1991 1993 1992 Aug. Sept. Oct. Nov. Dec. Jan. Feb. INTEREST R A T E S 1 2 3 4 Commercial banks2 48-month new car 24-month personal 120-month mobile home Credit card Auto finance 5 N e w car 6 Used car 11.78 15.46 14.02 18.17 11.14 15.18 13.70 18.23 9.29 14.04 12.67 17.78 9.15 13.94 12.57 17.66 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 8.60 13.55 12.36 17.38 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 8.57 13.57 12.38 17.26 12.54 15.99 12.41 15.60 9.93 13.80r 8.88 13.49 8.65 13.44 9.51 13.37 9.65 13.37 9.65 13.66 r 10.08 13.72 10.32 13.90 54.6 46.0 55.1 47.2 54.0 47.9" 53.6 47.9 53.3 47.7 54.1 47.9 54.1 47.8 53.6 47.7 r 53.9 49.2 54.3 49.0 87 95 88 96 89 97 90 97 90 97 89 97 89 97 90 97 90 97 91 98 12,071 8,289 12,494 8,884 13,584r 9,119 r 13,745 9,238 13,889 8,402 13,885 9,373 14,043 9,475 14,315 r 9,464 r 13,975 9,472 13,849 9,457 companies OTHER TERMS3 Maturity (months) 7 N e w car 8 Used car Loan-to-value 9 N e w car 10 Used car ratio Amount financed 11 N e w car 12 Used car (dollars) 1. Data in this table also appear in the Board's G.19 (421) monthly statistical release. For ordering address, see inside front cover. 2. Data are available for only the second month of each quarter, 3. At auto finance companies. Flow of Funds 1.57 A39 F U N D S R A I S E D IN U . S . CREDIT MARKETS 1 Billions of dollars; quarterly data at seasonally adjusted annual rates 1992 1991 Transaction category or sector Q2 Q4 Q3 QI Q2" Q3" Q4 Nonfinancial sectors 1 775.8 740.8 665.0 442.7 r 587.4 534.4" 155.1 137.7 17.4 146.4 144.7 1.6 246.9 238.7 8.2 278.2 292.0 -13.8 304.0 303.8 .2 276.7 282.9 -6.2 620.7 594.4 418.2 164.4R 283.5 257.7" 113.0" By instrument Debt capital instruments Tax-exempt obligations Corporate bonds Mortgages Home mortgages Multifamily residential Commercial Farm Other debt instruments Consumer credit Bank loans n.e.c Open market paper Other 474.1 53.7 103.1 317.3 241.8 16.7 60.8 -2.1 146.6 50.1 41.0 11.9 43.6 441.8 65.0 73.8 303.0 245.3 16.4 42.7 -1.5 152.6 41.7 40.2 21.4 49.3 342.3 51.2 47.1 244.0 219.4 3.7 21.0 -.1 75.8 17.5 4.4 9.7 44.2 244.7" 45.8 78.8 r 120. l 129.0" -.9" -7.3R -.8 -80.2 -12.5 -33.4 -18.4 -15.8 280.4 53.3 66.3 160.8 198.5 -8.3 -29.9 .5 3.0 2.4 -16.8 9.8 7.5 321.0" 48.5 96.5 175.9" 147.3" 12.7" 16.6" -.6" -63.3 -7.8 -34.5 -15.9 -5.2 By borrowing sector State and local government Household Nonfinancial business Farm Nonfarm noncorporate Corporate 48.9 318.6 253.1 -7.5 61.8 198.8 63.2 305.6 225.6 1.6 50.4 173.6 48.3 254.2 115.6 2.5 26.7 86.4 38.5 144.9" -18.9" .9 -23.6 3.7 R 48.1 215.1 20.2 .9 -34.2 53.5 38.6 178.0" 41.1" 2.2" 9.8 29.1" 6.4 6.9 -1.8 8.7 -7.5 10.2 4.9 -.1 13.1 -7.6 23.9 21.4 -2.9 12.3 -6.9 14.1 14.9 3.1 6.4 -10.2 782.2 750.9 688.9 Total net borrowing by domestic nonfinancial sectors . . By sector and instrument 7 U.S. government Treasury securities 4 Agency issues and mortgages 5 6 7 8 9 10 11 1? N 14 IS 16 17 18 19 70 71 ?? 23 24 Private 25 76 27 28 29 Foreign net borrowing in United States Bonds Bank loans n.e.c Open market paper U.S. government loans 30 Total domestic plus foreign 456.8" 24.1 18.5 1.6 5.2 -1.2 611.6 371.1" 687.5" 583.0 476.0 603.2 320.4 316.6 3.8 368.9 380.1 -11.2 351.9 351.5 .4 193.4 184.4 9.0 301.7 299.1 2.7 50.7" 318.6" 231.1 282.6 301.5 177.8" 53.5 81.6" 42.6" 118.6" -31.0" -42.6" -2.4" -64.8 -24.0 -18.2 -36.3 13.7 175.4" 45.5 60.2" 69.7" 93.0" 8.0" -31.4" .0 -124.7 -8.0 -66.1 -7.0 -43.6 333.0" 52.0 76.3 204.8" 221.5" .0" -15.7" -1.0" -14.4 3.1 -26.9 12.6 -3.2 267.1 73.0 77.5 116.6 155.5 -17.9 -23.2 2.2 -36.0 -12.4 -21.5 -3.4 1.3 253.7 52.3 61.3 140.1 202.8 -2.7 -61.8 1.8 28.8 .4 -3.2 1.7 30.0 267.9 35.9 50.3 181.7 214.2 -12.7 -18.8 -1.0 33.6 18.8 -15.4 28.4 1.9 37.6 132.3" -56.9" -.2" -65.9 9.2" 41.9 104.2" -95.4" -2.2 -51.5 -41.7" 46.1 229.0" 43.6" -1.6 -20.7 65.9" 63.4 177.2 -9.4 6.6 -50.6 34.7 50.0 220.7 11.9 1.0 -40.3 51.1 32.9 233.7 34.9 -2.3 -25.2 62.4 -63.2 10.6 -3.5 -51.9 -18.3 15.6 15.5 1.4 16.0 -17.2 41.0 22.3 6.5 14.9 -2.7 9.9 4.9 1.5 -7.8 11.4 55.2 21.9 14.1 27.7 -8.5 30.6 22.3 3.9 12.8 -8.4 .8 25.1 -13.2 -11.9 .7 471.2" 417.0" 412.1" 697.4" 638.2 506.6 604.0 401.4" 288.4 317.2 -28.8 Financial sectors Total net borrowing by financial sectors 211.4 220.1 187.1 131.5" 223.3 106.0" 143.8" 165.6" 159.5" 241.6 265.2 227.0 34 35 By instrument U.S. government-related Sponsored-credit-agency securities Mortgage pool securities Loans from U.S. government 119.8 44.9 74.9 .0 151.0 25.2 125.8 .0 167.4 17.1 150.3 -.1 150.0" 9.2 140.9" .0 167.1 40.2 126.9 .0 129.4" -29.7 159.0" .0 156.0" 20.6 135.5" .0 158.5" 32.6 125.9" -.1 137.4" 11.5 125.9" .0 222.8 48.3 174.4 .0 165.6 67.7 97.9 .0 142.7 33.5 109.2 .0 36 37 38 39 40 41 Private Corporate bonds Mortgages Bank loans n.e.c Open market paper Loans from Federal Home Loan Banks 91.7 16.2 .3 .6 54.8 19.7 69.1 46.8 .0 1.9 31.3 -11.0 19.7 34.4 .3 1.2 8.6 -24.7 -18.6" 47.7" .6 3.2 -32.0 -38.0 56.2 50.0 .3 7.2 -2.1 .8 -23.4 72.4 .9 -2.9 -46.0 -47.7 -12.3" 29.5 .4" 10.2 -16.7 -35.7 7.1" 47.5" .8" 4.5 -12.7 -33.0 22.1" 14.9" .9 8.2 7.6 -9.5 18.9 25.5 .1 3.9 -16.3 5.7 99.6 59.8 .3 5.4 12.8 21.3 84.3 99.9 .1 11.1 -12.6 -14.2 42 43 44 45 46 47 48 49 50 51 By borrowing sector Sponsored credit agencies Mortgage pools Private Commercial banks Bank affiliates Savings and loan associations Mutual savings banks Finance companies Real estate investment trusts (REITs) Securitized credit obligation (SCO) issuers 44.9 74.9 91.7 -3.0 5.2 19.9 1.9 31.5 3.6 32.5 25.2 125.8 69.1 -1.4 6.2 -14.1 -1.4 59.7 -1.9 22.0 17.0 150.3 19.7 -1.1 -27.7 -29.9 -.5 35.6 -1.9 45.2 9.1 140.9" -18.6" -13.3 -2.5 -39.5 -3.5 4.5" .0 35.6 40.2 126.9 56.2 4.5 1.1 -4.6 1.7 14.3 1.8 37.4 -29.7 159.0" -23.4 -11.7 -3.5 -48.7 -1.7 3.4 .1 38.7 20.6 135.5" -12.3" -9.2 -6.8 -41.1 -5.5 12.2 -.3" 38.5 32.5 125.9" 7.1 R -14.1 9.6 -25.1 -8.7 12.9" .1" 32.3 11.5 125.9" 22.1" 7.2 2.7 -20.3 4.3 1.0" 4.6 22.5 48.3 174.4 18.9 .8 -8.2 2.7 .3 -20.9 .9 43.2 67.7 97.9 99.6 1.6 10.5 10.0 8.3 28.9 1.3 39.1 33.5 109.2 84.3 8.2 -.4 -10.6 -6.2 48.0 .5 44.8 31 37 33 A40 DomesticNonfinancialStatistics • June 1993 1.57—Continued 1991 Transaction category or sector 1988 1989 1990 1991 1992 1992 Q2 Q3 Q4 Ql Q2" Q3 r Q4 All sectors 52 Total net borrowing, all sectors 993.6 971.0 876.0 588.3 r 834.9 577.2 r 560.8 r 577.7 r 856.9* 879.8 771.8 831.0 53 54 55 56 57 58 59 60 274.9 53.7 126.3 317.5 50.1 39.9 75.4 55.8 297.3 65.0 125.5 303.0 41.7 41.9 65.9 30.6 414.4 51.2 102.9 244.3 17.5 2.8 30.7 12.4 428.3 r 45.8 141.3r 120.7r -12.5 -27.1 -44.0 -64.2 471.1 53.3 134.9 161.1 2.4 -8.0 12.9 7.1 406. l r 48.5 179.5 176.9" -7.8 -40.9 -113.8 -71.2 444.4 r 53.5 126.7 r 43.0" -24.0 -6.7 -37.0 -39.1 479.0" 45.5 130.0" 70.5" -8.0 -55.1 -4.9 -79.3 506.3" 52.0 96.0" 205.7" 3.1 -17.2 12.4 -1.3 574.7 73.0 124.9 116.7 -12.4 -3.5 8.1 -1.6 359.0 52.3 143.4 140.3 .4 6.1 27.3 43.0 444.4 35.9 175.3 181.8 18.8 -17.5 3.9 -11.6 U . S . government securities State and local obligations Corporate and foreign bonds Mortgages Consumer credit Bank loans n.e.c Open market paper Other loans External corporate equity funds raised in United States 61 Total net share issues -118.4 -65.7 22.1 198.8 272.1 182.3 232.5 r 268.2 r 230.3 r 291.7 288.6 277.7 62 Mutual funds 63 All other Nonfinancial corporations 64 Financial corporations 65 66 Foreign shares purchased in United States 6.1 -124.5 -129.5 4.1 .9 38.5 -104.2 -124.2 2.7 17.2 67.9 -45.8 -63.0 9.8 7.4 150.5 48.3 18.3 -.1 30.2 206.4 65.7 26.8 7.4 31.5 125.6 56.7 12.0 8.1 36.6 182.5 50.0" 19.0 -3.2" 34.1 195.9 72.3" 48.0 1.4" 22.9 148.4" 81.9 46.0 6.0 29.9 236.3 55.4 36.0 8.4 11.0 233.3 55.3 11.0 8.1 36.2 207.5 70.2 14.0 7.3 48.9 1. Data in this table also appear in the Board's Z. 1 (780) quarterly statistical release, tables F.2 through F.5. For ordering address, see inside front cover. Flow of Funds 1.58 A41 S U M M A R Y OF F I N A N C I A L TRANSACTIONS 1 Billions of dollars except as noted; quarterly data at seasonally adjusted annual rates 1992 1991 Transaction category or sector 1988 1989 1990 1991 1992 Q2 Q3 Q4 QLR Q2 R Q3 R Q4 N E T LENDING IN CREDIT MARKETS 2 993.6 1 Total net lending in credit markets ? Private domestic nonfinancial sectors Households 4 Nonfarm noncorporate business Nonfinancial corporate business 5 6 State and local governments 7 U . S . government 8 9 10 11 1? N 14 IS 16 17 18 19 70 71 77 ?3 74 7*> 76 ?7 78 79 30 31 3? 33 34 Sponsored credit agencies Mortgage pools Monetary authority Commercial banking U . S . commercial banks Foreign banking offices Bank affiliates Banks in U . S . possession Private nonbank finance Thrift institutions Savings and loan associations Mutual savings banks Credit unions Life insurance companies Other insurance companies Private pension funds State and local government retirement f u n d s . Finance n.e.c Finance companies Mutual funds Money market funds Real estate investment trusts (REITs) Brokers and dealers Securitized credit obligation (SCOs) issuers . 971.0 876.0 588.3R 834.9 577.2R 560.8R 577.7R 856.9 879.8 771.8 831.0 203.8 172.3 -1.4 6.6 26.2 33.7 58.4 580.2 16.4 150.3 8.1 125.4 95.2 28.4 -2.8 4.5 279.9 -151.9 -143.9 10.5 R -24.8R -1.9 20.9 16.3 10.0 42.6 R 5 2 5 . LR 14.2 140.9 R 31.1 84.0 38.9 48.5 -1.5 -1.9 255.0 R -144.9 -140.9 60.6 65.8 -2.1 8.4 -11.5 -12.4 97.6 689.1 62.7 126.9 27.9 90.7 69.2 14.5 6.7 .3 380.9 -63.8 -77.0 187.7 R 171.3 R -2.0 29.0 -10.6 24.8 51.4 313.3R -25.2R 159.0 R -4.0 34.7 6.4 33.7 -2.6 -2.8 148.8 R -164.8 -144.0 -143.2R -185.8R -1.6 32.2 12.1 -2.1 37.3 668.7R 35.8 R 135.5 R 48.1 82.4 26.5 56.7 2.4 -3.3 367.0R -176.8 -156.3 -59.7R -105^ -2.1 30.1 18.2 -17.9 71.0 584.3R 18.6 R 125.9 R 22.3 104.3 45.6 61.3 -1.1 -1.5 206.5 227.2 -1.9 -2.7 -16.1 13.9 88.4 548.0 93.0 125.9 33.2 98.9 91.9 .6 6.4 .0 197.0 -113.3 -137.9 120.6 111.3 -2.5 8.4 3.4 -24.9 138.4 645.6 40.0 174.4 9.8 58.4 .5 58.6 -.6 362.9 -81.6 -92.4 -162.8 -160.3 -1.9 15.4 -15.9 -26.8 64.2 897.2 76.4 97.9 10.8 157.4 132.0 6.5 18.5 .4 554.7 -41.9 -38.5 78.0 84.9 -1.9 12.5 -17.6 -12.0 99.6 665.5 41.6 109.2 57.8 48.1 52.4 -7.6 2.5 .8 408.8 -18.5 -39.1 -31.1 10.2 216.3 r 132.8 37.0 -2.5r 49.0 97.4 -14.5 75.3 -68.9 -.1 66.8 38.7 -30.8 10.3 257. l r 73.8 36.8 113.l r 33.4 286.7 r -5.2 117.1 1.1 135.8 38.5 11.5 22.2 156.5 r 13.2 32.1 94.2 r 17.0 206.3 r -54.1r 124.8 53.8 r -.9 50.5 32.3 7.6 17.0 114.2 80.6 33.1 -28.7 29.2 196.1 40.8 64.0 61.9 -.7 7.5 22.5 183.6 81.9 22.2 49.5 30.0 260.9 -23.0 169.1 -20.9 2.6 89.8 43.2 -13.0 9.6 227.8 96.5 2.5 90.5 38.2 368.9 14.2 150.7 -16.3 -2.8 184.0 39.1 1.5 19.0 213.9 120.4 11.2 39.7 42.6 213.4 51.2 110.4 -14.7 7.0 14.7 44.8 560.8R 577.7R 856.9 879.8 771.8 831.0 -15.5 -5.0 .4 .5 19.4 19.2 r r 342.2 241.5 r 99.9 r -32.5r 27.3 47.8 104.5 114.4 -42.4 13.0 -78.1 -117.4 4.0 26.8 36.3 16.0 3.0 -5.0 182.5 195.9 50.0" 72.3 r 82.4 120.7 r 47.6 -7.3R -3.2R 13.l r r 45.6 5.2 R 38.7 r 205. l r 3.5 .1 30.5 129.0 56.1 74.7 88.6 -29.9 -78.8 106.2 15.5 -26.9 148.4 81.9 -70.0 75.2 -2.3 -19.0 194.7 -6.5 .3 28.7 178.6 20.8 -55.2 92.8 -89.3 -104.9 -38.3 136.9 -52.5 236.3 55.4 -4.3 36.0 10.7 11.6 275.8 -8.5 .2 32.5 305.3 119.4 223.9 202.7 -79.0 -54.8 -13.0 128.7 39.3 233.3 55.3 76.4 51.8 7.1 -16.2 214.8 -2.4 -7.7 36.4 2%.2 -10.7 -40.3 104.1 -52.9 -77.8 -21.7 6.1 2.0 207.5 70.2 42.5 41.8 3.4 -18.9 121.9 226.2 198.9 3.1 5.7 18.6 -10.6 96.3 681.8 37.1 74.9 10.5 157.1 127.1 29.4 -.1 .7 402.2 119.0 87.4 15.3 209.6 179.5 -.8 12.9 17.9 -3.1 74.1 690.4 -.5 125.8 -7.3 176.8 145.7 26.7 2.8 1.6 395.7 -91.0 -93.9 -4.8 16.3 186.2 103.8 29.2 18.1 35.1 96.9 49.2 11.9 10.7 .9 -8.2 32.5 7.7 207.7 93.1 29.7 36.2 48.7 278.9 69.3 23.8 67.1 .5 96.3 22.0 -16.5 8.5 188.5 94.4 26.5 16.6 51.0 243.3 41.6 41.4 80.9 -.7 34.9 45.2 -15.5 11.5 218.7R 83.2 34.7 37.0 181.3R -23.lr 90.3 30.1 -.7 49.0 35.6 -2.8 16.0 184.9 94.9 17.3 37.8 35.0 259.8 20.8 123.6 2.5 1.5 74.0 37.4 993.6 971.0 876.0 588.3R 834.9 577.2R 4.0 .5 25.3 193.6 2.9 259.9 43.2 120.8 53.6 21.9 23.5 -3.1 6.1 -124.5 3.0 89.2 5.3 -31.2 222.3 24.8 4.1 28.8 221.4 -16.5 290.0 -5.9 96.7 17.6 90.1 78.3 1.1 38.5 -104.2 15.6 60.0 2.0 -32.5 269.9 2.0 2.5 25.7 186.8 34.2 96.8 44.2 59.9 -66.7 70.3 -23.5 12.6 67.9 -45.8 3.5 44.1 -4.8 .4 31.4 194.7 r -79.6r -75.4 7.9 -1.1 -63.0 -58.7 43.1 -3.6 125.6 56.7 20.1 41.2 r -11.4r -33.6r 89.0 r 1,650.2 1.6 63^ -.6R 313. l r -49.7 -83.3 -.1 -7.4 18.3 RELATION OF LIABILITIES TO FINANCIAL ASSETS 35 Net flows through credit markets 36 37 38 39 40 41 4? 43 44 45 46 47 48 49 50 51 5? 53 54 Other financial sources Official foreign exchange Treasury currency and special drawing rights Life insurance reserves Pension fund reserves Interbank claims Deposits at financial institutions Checkable deposits and currency Small time and savings deposits Large time deposits Money market fund shares Security repurchase agreements Foreign deposits Mutual fund shares Corporate equities Security credit Trade debt Taxes payable Noncorporate proprietors' equity Miscellaneous 55 Total financial sources Floats not included in assets ( - ) 56 U . S . government checking deposits 57 Other checkable deposits 58 Trade credit 59 60 61 6? 63 Liabilities not identified Treasury currency as assets Security repurchase agreements T a x e s payable Miscellaneous 64 Totals identified to sectors as assets -39.3 120.5 140. l r -3.5 -1.8 32.0 227.3 46.4 50.8 122.1 -62.8 -79.1 8.3 71.8 -9.5 206.4 65.7 11.1 51.2 4.7 -10.6 201.8 1,772.7 1,374.3 L,323.0 R 1,716.4 931.6R [.IM.? L,438.0 R 1,559.8 1,668.1 2,066.9 1,571.0 -.9 8.4 -3.2 .6 3.3 2.5 21.5 -13.1 2.0 18.4 r .1 1.6 -4.5 15.6 3.0 40.7 r 23.9 -2.1 27.2 r -73.1 -6.1 -3.7r 4.4 16.7 6.7 -11.7 2.5 -29.1 -5.3 -13.9 24.3 13.0 1.1 -19.8 -.1 -3.0 -29.8 6.3 4.4 -.2 -4.4 23.9 2.3 -95.6 .2 1.6 -34.8 6.5 -13.8 -30.6 r -.2 -6.3 41.5 9.8 -19.2 -.3 20.8 76.2 2.0 6.4 r -.2 28.4 36.9 23.4 -191.8r 44.0 11.4 r 182.3 r -.4 13.4 -41.1 -11.3 -71.0 -.1 -15.1 104.2 25.7 -76.1 -.3 -2.6 76.4 23.0 3.6 -.1 -20.8 26.6 1.8 66.8 1,670.7 1,841.0 1,387.5 L,304.7 R 1,693.6 767.L R L,548.9 R L,283.1 R 1,642.4 1,667.8 1,961.6 1,502.5 .8 6.1 -.5 r 24.5 267.7 r -3.7r 61.1 75.8 16.7 -60.9 41.2 r -16.4 4.6 150.5 48.3 51.4 10.4 r -9.(Y -.8R (-) 1. Data in this table also appear in the Board's Z . l (780) quarterly statistical release, tables F.6 and F.7. For ordering address, see inside front cover. .0 -.6 26.2 10.4 5.6 R -.1 .2 2. Excludes corporate equities and mutual fund shares, A42 1.59 DomesticNonfinancialStatistics • June 1993 S U M M A R Y OF CREDIT MARKET D E B T O U T S T A N D I N G 1 Billions of dollars, end of period 1991 Q2 1992 Q4 Q3 Ql Q2 Q3" Q4 11,615.3 11,788.3 Nonfinancial sectors 1 Total credit market debt owed by domestic nonfinancial sectors 10,087.1 10,760.8 11,200.9* 11,788.3 By lending sector and instrument 2 U.S. government Treasury securities 3 4 Agency issues and mortgages 2,251.2 2,227.0 24.2 2,498.1 2,465.8 32.4 2,776.4 2,757.8 18.6 3,080.3 3,061.6 18.8 2,591.9 2,567.1 24.8 2,687.2 2,669.6 17.6 2,776.4 2,757.8 18.6 2,859.7 2,844.0 15.8 2,923.3 2,907.4 15.9 2,998.9 2,980.7 18.1 3,080.3 3,061.6 18.8 5 Private 7,835.9 8,262.6 8,424.5 r 8,708.0 8,368.2" 8,394.1" 8,424.5" 8,472.0" 8,548.5" 8,616.4 8,708.0 6 7 8 9 10 11 12 13 14 15 16 17 18 By instrument Debt capital instruments Tax-exempt obligations Corporate bonds Mortgages Home mortgages Multifamily residential Commercial Farm Other debt instruments Consumer credit Bank loans n.e.c Open market paper Other 5,577.9 1,004.4 926.1 3,647.5 2,515.1 304.4 742.6 85.3 2,258.0 791.8 760.7 107.1 598.4 5,936.0 1,055.6 973.2 3,907.3 2,760.0 305.8 757.6 84.0 2,326.7 809.3 758.0 116.9 642.6 6,180.6 r 1,101.4 1,051.9" 4,027.3 r 2,889.0' 304.9" 750.3" 83.2 2,243.9 796.7 724.6 98.5 624.1 6,461.1 1,154.7 1,118.3 4,188.1 3,087.5 296.6 720.4 83.7 2,246.9 799.2 707.8 108.3 631.6 6,087.4" 1,072.5 1,016.5 3,998.5" 2,835.3" 310.6" 768.8" 83.8 2,280.8 786.7 742.0 119.4 632.6 6,137.2" 1,089.3 1,036.9 4,011.1" 2,866.9" 302.9" 758.1" 83.2" 2,256.9 785.9 734.1 107.0 629.8 6,180.6" 1,101.4 1,051.9" 4,027.3" 2,889.0" 304.9" 750.3" 83.2 2,243.9 796.7 724.6 98.5 624.1 6,252.0" 1,111.5 1,071.0 4,069.4" 2,935.3" 304.9" 746.4" 82.9 2,220.0 775.7 712.5 110.3 621.6 6,326.7" 1,128.6 1,090.4 4,107.7" 2,983.3" 300.4" 740.6" 83.5" 2,221.9" 775.8 709.4 111.7 624.9" 6,395.4 1,145.6 1,105.7 4,144.1 3,035.4 299.7 725.1 83.9 2,221.0 781.1 705.2 108.3 626.4 6,461.1 1,154.7 1,118.3 4,188.1 3,087.5 296.6 720.4 83.7 2,246.9 799.2 707.8 108.3 631.6 19 20 21 22 23 24 By borrowing sector State and local government Household Nonfinancial business Farm Nonfarm noncorporate Corporate 815.7 3,508.2 3,512.0 139.2 1,177.5 2,195.3 864.0 3,780.6 3,618.0 140.5 1,204.2 2,273.4 902.5 3,925.5" 3,596.5" 138.8 1,180.6 2,277.1" 950.6 4,140.6 3,616.7 139.7 1,146.4 2,330.6 878.5 3,846.7" 3,643.0" 139.6 1,210.8 2,292.7" 891.4 3,886.0" 3,616.7" 140.4 1,191.0 2,285.3" 902.5 3,925.5" 3,596.5" 138.8 1,180.6 2,277.1" 911.3 3,950.6" 3,610.1" 136.4" 1,174.9 2,298.9" 925.9 4,008.1" 3,614.5" 140.1" 1,163.7" 2,310.7" 942.3 4,068.6 3,605.5 141.2 1,150.6 2,313.7 950.6 4,140.6 3,616.7 139.7 1,146.4 2,330.6 254.8 278.6 292.7 307.6 277.6 282.2 292.7 282.4 298.4" 306.9 307.6 88.0 21.4 63.0 82.4 109.4 18.5 75.3 75.4 124.2 21.6 81.8 65.2 142.7 23.2 77.7 64.0 114.8 19.7 74.0 69.1 118.6 20.0 78.0 65.6 124.2 21.6 81.8 65.2 125.4 22.0 70.5 64.4 130.9" 25.5 77.5 64.5" 136.5 26.5 80.7 63.4 142.7 23.2 77.7 64.0 10,341.9 11,039.4 11,237.7" 11,363.5" 11,493.6" 11,614.1" 11,770.2" 11,922.2 12,095.9 25 Foreign credit market debt held in United States 26 27 28 29 Bonds Bank loans n.e.c Open market paper U . S . government loans 30 Total credit market debt owed by nonfinancial sectors, domestic and foreign ll,493.6 r 12,095.9 10,960.1" 11,081.3" 11,200.9" 11,331.8" 11,471.8" Financial sectors 31 Total credit market debt owed by financial sectors 32 33 34 35 36 37 38 39 40 41 By instrument U.S. government-related Sponsored credit-agency securities Mortgage pool securities Loans from U.S. government Private Corporate bonds Mortgages Bank loans n.e.c Open market paper Loans from Federal Home Loan Banks By borrowing sector 42 Sponsored credit agencies 43 Mortgage pools 44 Private financial sectors Commercial banks 45 Bank affiliates 46 47 Savings and loan associations 48 Mutual savings banks 49 Finance companies 50 Real estate investment trusts (REITs) 51 Securitized credit obligation (SCO) issuers... 2,333.0 2,524.2 2,665.9" 2,890.1 2,578.2" 2,615.1" 2,665.9" 2,697.7" 2,756.6" 2,824.0 2,890.1 1,249.3 373.3 871.0 5.0 1,083.7 491.9 3.4 37.5 409.1 141.8 1,418.4 393.7 1,019.9 4.9 1,105.8 528.2 4.2 38.6 417.7 117.1 1,574.3" 402.9 1,166.7" 4.8 1,091.6" 580.2" 4.8 41.8 385.7 79.1 1,741.5 443.1 1,293.5 4.8 1,148.6 621.8 5.1 49.0 392.8 79.9 1,489.6" 389.6 1,095.2" 4.9 1,088.6 562.2 4.5 37.0 390.1 94.7 1,531.1" 394.7 1,131.5" 4.9 1,084.0" 569.5 4.6" 39.0 387.0 83.9 1,574.3" 402.9 1,166.7" 4.8 1,091.6" 580.2" 4.8 41.8 385.7 79.1 1,603.8" 405.7 1,193.2" 4.8 1,094.0 578.2 5.0 41.6 392.9 76.3 1,658.3" 417.8 1,235.6" 4.8 1,098.3 583.2 5.0 43.7 389.5 76.9 1,702.0 434.7 1,262.5 4.8 1,122.0 598.4 5.1 44.5 393.9 80.2 1,741.5 443.1 1,293.5 4.8 1,148.6 621.8 5.1 49.0 392.8 79.9 378.3 871.0 1,083.7 77.4 142.5 145.2 17.2 504.2 10.1 187.1 398.5 1,019.9 1,105.8 76.3 114.8 115.3 16.7 539.8 10.6 232.3 407.7 1,166.7" 1,091.6" 63.0 112.3 75.9 13.2 547.9" 11.4 268.0 447.9 1,293.5 1,148.6 67.4 113.4 71.3 14.9 562.2 14.0 305.4 394.4 1,095.2" 1,088.6 65.9 113.3 91.0 16.6 540.4 11.0 250.3 399.5 1,131.5" 1,084.0" 64.6 110.6 79.0 15.2 543.7 11.2" 259.9 407.7 1,166.7" 1,091.6" 63.0 112.3 75.9 13.2 547.9" 11.4 268.0 410.5 1,193.2" 1,094.0 60.8 115.0 71.2 13.5 547.1 12.7 273.6 422.6 1,235.6" 1,098.3 61.7 112.7 70.3 14.3 541.8 13.2 284.4 439.5 1,262.5 1,122.0 63.3 114.4 70.9 16.2 549.4 13.7 294.2 447.9 1,293.5 1,148.6 67.4 113.4 71.3 14.9 562.2 14.0 305.4 14,746.2 14,985.9 4,696.0 1,145.6 1,840.5 4,149.2 781.1 776.1 582.9 774.8 4,817.0 1,154.7 1,882.8 4,193.3 799.2 780.0 578.8 780.3 All sectors 52 Total credit market debt, domestic and foreign.. 53 54 55 56 57 58 59 60 U.S. government securities State and local obligations Corporate and foreign bonds Mortgages Consumer credit Bank loans n.e.c Open market paper Other loans 12,674.9 13,563.6 14,159.6" 14,985.9 3,495.6 1,004.4 1,506.0 3,650.9 791.8 819.6 579.2 827.5 3,911.7 1,055.6 1,610.7 3,911.5 809.3 815.1 609.9 839.9 4,345.9" 1,101.4 1,756.4" 4,032.1" 796.7 788.0 565.9 773.2 4,817.0 1,154.7 1,882.8 4,193.3 799.2 780.0 578.8 780.3 1. Data in this table also appear in the Board's Z.l (780) quarterly statistical release, tables L.2 through L.4. For ordering address, see inside front cover. 13,815.9" 13,978.7" 14,159.6" 14,311.9" 14,526.8" 4,076.6" 1,072.5 1,693.5 4,003.0" 786.7 798.7 583.6 801.4 4,213.5" 1,089.3 1,725.0 4,015.6" 785.9 793.2 572.0 784.2 4,345.9" 1,101.4 1,756.4" 4,032.1" 796.7 788.0 565.9 773.2 4,458.7" 1,111.5 1,774.6 4,074.5" 775.7 776.1 573.7 767.1 4,576.8" 1,128.6 1,804.5" 4,112.7" 775.8 778.7 578.7 771.1" Flow of Funds 1.60 A43 S U M M A R Y OF F I N A N C I A L ASSETS A N D LIABILITIES 1 Billions of dollars except as noted, end of period 1992 1991 T r a n s a c t i o n c a t e g o r y or s e c t o r 1989 1990 1991 1992 Q2 Q3 Q4 QL Q2" Q3" Q4 14,159.6R CREDIT MARKET D E B T O U T S T A N D I N G 2 2 Private domestic nonfinancial sectors 3 Households 4 Nonfarm noncorporate business 5 Nonfinancial corporate business 6 State and local governments 7 U.S. government 8 Foreign 9 Financial sectors 10 S p o n s o r e d credit agencies 11 Mortgage pools 12 Monetary authority 13 Commercial banking 14 U.S. commercial banks 15 Foreign banking offices 16 B a n k affiliates 17 B a n k s in U . S . p o s s e s s i o n 18 P r i v a t e n o n b a n k finance 19 Thrift institutions 20 Savings and loan associations 21 Mutual savings banks 22 Credit unions 23 Insurance 24 Life insurance companies 25 Other insurance companies 26 Private pension funds 27 State and local government retirement funds, 28 Finance n.e.c 29 Finance companies 30 Mutual funds 31 Money market funds 32 Real estate investment trusts (REITs) 33 Brokers and dealers 34 Securitized credit obligation ( S C O s ) issuers . 14,159.6R 13,815.9R 13,978.7' R R 13,815.9" 14,311.9* 14,526.8 14,746.2 14,985.9 2,440.5 1,710.1 56.4 180.3 493.7 205.1 734.2 9,295.1 367.2 871.0 233.3 2,643.9 2,368.4 242.3 16.2 17.1 5,179.7 1,484.9 1,088.9 241.1 154.9 2,140.3 1,013.1 317.5 394.7 414.9 1,554.5 617.1 307.2 291.8 8.4 142.9 187.1 2,644.2 1,882.3 55.0 186.9 519.9 238.7 792.4 9,888.3 383.6 1,019.9 241.4 2,769.3 2,463.6 270.8 13.4 21.6 5,474.1 1,335.5 945.1 227.1 163.4 2,329.1 1,116.5 344.0 431.3 437.4 1,809.4 658.7 360.2 372.7 7.7 177.9 232.3 2,531.9" L,734.7R 53.1 207.9 536.2 246.2 835.LR 10,546.4R 397.7 L,166.7R 272.5 2,853.3 2,502.5 319.2 11.9 19.7 5,856.2R 1,190.6 804.2 211.5 174.9 2,674.9" 1,199.6 378.7 622.2R 474.3 L,990.7R 635.6R 450.5 402.7R 7.0 226.9 268.0 2,584.0 2,661.3 1,791.9 L,889.5R 51.1 53.3 216.3 189.7 524.7 528.8 233.7 252.9 932.8 807.9R 11,235.5 10,093.8R 460.5 382.0R 1,293.5 L,095.2R 300.4 253.7 J ,944.0 2,796.6 1,571.7 2,480.0 333.8 284.4 18.6 11.3 20.0 20.9 (,,237.1 5,566.4R 1,248.4 1,126.8 727.2 866.3 208.7 216.4 190.9 165.7 859.8 2,443.9" ,294.5 1,183.7 396.0 361.4 660.0 437.LR 509.3 461.7 L,874.1R :>,250.5 656.4 651.7 574.0 394.4 405.2 389.9 8.5 7.4R 180.4 300.9 305.4 250.3 2,653.8 1,881.0" 52.9 189.9 530.0 252.0 817.2R 10,255.6R 389.3R L,131.5R 264.7 2,817.8 2,488.7 297.5 11.6 20.0 5,652.2R 1,205.1 826.1 208.7 170.2 2,507.4R 1,201.4 370.7 465.4R 470.1 1,939.7 647.4 421.4 389.5 7.2 214.3 259.9 2 , 5 3 1 Y 2,546.LR L,766.5R L,734.7R 51.9 53.1 196.2 207.9 531.4 536.2 250.2 246.2 835.LR 857.2R 10,546.4R 10,658.4R 397.7 419.9 L,193.2R L,166.7R 272.5 271.8 2,860.6 2,853.3 2,502.5 2,514.0 313.3 319.2 13.6 11.9 19.7 19.7 5,856.2R 5,913.0R 1,161.8 1,190.6 804.2 771.1 213.4 211.5 177.2 174.9 2,674.9R 2,708.0" 1,224.3 1,199.6 387.0 378.7 622.2R 615.LR 481.6 474.3 2,043.3R L,990.7R 641.0 635.6R 470.0" 450.5 402.7R 423.1 6.8 7.0 228.8 226.9 273.6 268.0 2,548.9 1,756.8 51.3 207.5 533.3 245.3 891.8 10,840.9 429.0 1,235.6 282.6 2,882.9 2,521.9 328.2 13.1 19.7 6,010.7 1,143.0 748.8 211.6 182.6 2,756.2 1,247.1 392.5 627.4 489.1 2,111.5 641.6 513.3 413.5 7.5 251.2 284.4 2,539.7 1,759.2 50.8 202.1 527.6 238.1 907.9 11,060.5 446.3 1,262.5 285.2 2,922.9 2,556.7 328.9 17.5 19.8 6,143.6 1,133.2 737.9 208.3 187.0 2,812.2 1,270.3 393.1 650.1 498.7 2,198.2 642.5 548.7 408.8 6.8 297.3 294.2 2,584.0 1,791.9 51.1 216.3 524.7 233.7 932.8 11,235.5 460.5 1,293.5 300.4 2,944.0 2,571.7 333.8 18.6 20.0 6,237.1 1,126.8 727.2 208.7 190.9 2,859.8 1,294.5 396.0 660.0 509.3 2,250.5 656.4 574.0 405.2 8.5 300.9 305.4 12,674.9 13,563.6 14,159.6" 14,985.9 13,978.7R 14,159.6R 14,526.8 14,746.2 14,985.9 53.6 61.3 23.8 354.3 3,210.5 32.4 4,644.6 888.6 2,265.4 615.4 428.1 403.2 43.9 566.2 133.9 903.9 81.8 2,508.3 26.3 380.0 3,303.0 64.0 4,741.4 932.8 2,325.3 548.7 498.4 379.7 56.6 602.1 137.4 938.0 81.4 2,678.8 26.3 402.0 4,223.4R 65.2R 4,802.5 1,008.5 2,342.0 487.9 539.6 363.4 61.2 813.9R 188.9 940.9R 72.3R 2,811.7R 24.5 434.0 4,585.8 111.4 4,853.3 1,130.3 2,279.3 409.0 547.9 435.2 51.6 1,056.5 224.3 992.1 77.1 2,921.0 25,188.3 26,577.2 2 8 , 5 6 2 . LR 30,317.6 12,674.9 1 Total credit market assets 13,563.6 14,985.9 RELATION OF LIABILITIES TO F I N A N C I A L ASSETS 35 Total credit m a r k e t debt Other liabilities 36 Official foreign e x c h a n g e .• • • • . 37 Treasury currency and special drawing rights certificates 38 Life insurance reserves 39 Pension fund reserves 40 Interbank claims 4 1 D e p o s i t s a t financial i n s t i t u t i o n s 42 Checkable deposits and currency 43 Small time and savings deposits 44 Large time deposits 45 M o n e y market fund shares 46 Security repurchase agreements 47 Foreign deposits 48 Mutual fund shares 49 Security credit 50 Trade debt 51 T a x e s p a y a b l e 52 Miscellaneous 53 Total liabilities 55.4 51.8 53.6 26.1 392.3 3,550.9" 35.9" 4,765.7 933.1 2,351.5 532.6 532.8 354.0 61.7 683.7 137.5 909.4 65.8 2,699.2R 52.9 26.2 397.2 3,716.5R 60.9" 4,769.5 948.3 2,339.7 517.1 533.1 368.9 62.4 744.2 158.1 935.3 71.9R 2,733.4R 27,136.1R 27,644.8R I4,311.9R 54.4 55.4 51.8 26.3 409.6" 4 , 2 4 2 . LR 67.4" 4,796.7R 984.3R 2,340.9" 469.7" 571.0 376.4 54.4" 857.7" 195.1 940.9" 74.2" 2,828.8" 26.4 416.8 4,294.2 70.7 4,790.9 1,032.3 2,314.7 438.7 557.2 406.8 41.3 935.5 194.1 945.3 69.8 2,875.3 26.5 424.9 4,429.1 101.8 4,843.1 1,071.6 2,294.3 428.8 553.2 444.1 51.1 977.4 213.1 974.6 74.8 2,915.2 24.5 434.0 4,585.8 111.4 4,853.3 1,130.3 2,279.3 409.0 547.9 435.2 51.6 1,056.5 224.3 992.1 77.1 2,921.0 2 8 , 5 6 2 . LR 2 8 , 8 0 3 . 3 " 29,200.2 29,782.1 30,317.6 55.4 26.3 402.0 4,223.4R 65.2R 4,802.5 1,008.5 2,342.0 487.9 539.6 363.4 61.2 813.9" 188.9 940.9R 72.3R 2,811.7R 52.7 Financial assets not included in liabilities (+) 5 4 G o l d a n d s p e c i a l d r a w i n g rights 55 Corporate equities 5 6 H o u s e h o l d e q u i t y in n o n c o r p o r a t e b u s i n e s s 21.0R 3,819.7 2,524.9 22.0" 3,506.6 2,449.4 22.3R 4,630.0 2,367.8R 19.6 5,127.7 2,263.6 21.4R 4,104.7 2,511.8R 21.8R 4,338.5 2,495.2R 22.3R 4,630.0 2,367.8R 22.0" 4,739.7 2,373.5" 22.1 4,678.1 2,354.7 23.2 4,860.5 2,330.9 19.6 5,127.7 2,263.6 Floats not included in assets ( - ) 57 U . S . g o v e r n m e n t c h e c k i n g deposits 58 Other checkable deposits 59 Trade credit 6.1 26.5 -159.7 15.0 28.9 -148.0 3.8 30.9 -134.0R 6.8 32.5 -138.5 8.3 29.9 -157.7 19.8 23.6 -154.2 3.8 30.9 -134.0R .9 29.5" -135.2" 1.4 32.6 -154.7 4.0 23.3 -152.7 6.8 32.5 -138.5 Liabilities not identified as assets Treasury currency Interbank claims Security repurchase agreements Taxes payable Miscellaneous -4.3 -31.0 11.5 20.6 -251.LR -4.1 -32.0 -23.3 21.8 -247.3R -4.8 -4.2 -12.9 18.9" -452.3R -5.0 -10.7 27.1 28.9 -549.3 -4.7 -9.9 -25.8 11.8R -242.3R -4.7 -4.7 -10.6 17.6R -300.8R -4.8 -4.2 -12.9 18.9" -452.3R -4.9 -1.8 -10.1 11.5" -443.0" -4.9 -4.0 11.6 18.0 -455.7 -5.0 -5.9 36.5 24.4 -510.1 -5.0 -10.7 27.1 28.9 -549.3 38,336.6 34,164.3R 34,914.2" 36,136.8R 36,491.8" 36,810.8 37,582.0 38,336.6 60 61 62 63 64 6 5 T o t a l s i d e n t i f i e d to s e c t o r s a s a s s e t s ( - ) 31,935.2R 32,944.3R 36,136.8R 1. D a t a i n t h i s t a b l e a l s o a p p e a r i n t h e B o a r d ' s Z . l ( 7 8 0 ) q u a r t e r l y s t a t i s t i c a l release, tables L . 6 through L.7. F o r ordering address, see inside front cover. 2. E x c l u d e s c o r p o r a t e e q u i t i e s a n d m u t u a l f u n d s h a r e s . A44 2.10 Domestic Nonfinancial Statistics • June 1993 NONFINANCIAL BUSINESS ACTIVITY Selected Measures Monthly data seasonally adjusted, 1987=100 except as noted 1993 1992 Measure 1990 1991 1992 July Aug. Sept. Oct. Nov.r Dec.r Jan. r Feb. Mar. 1 Industrial production 1 109.2 107.1 108.7 109.4 109.1 108.9 109.7 110.4 111.0 111.4 112.0 112.0 Market groupings Products, total Final, total Consumer goods Equipment Intermediate Materials 110.1 110.9 107.3 115.5 107.7 107.8 108.1 109.6 107.5 112.2 103.4 105.5 109.5 111.1 110.5 r 111.9 104.6 107.5 r 109.6 111.0 110.4 111.8 105.1 109.0 109.8 111.5 110.8 112.5 104.4 108.1 109.6 111.2 110.7 111.9 104.5 107.9 110.7 112.4 111.9 113.0 105.5 108.2 111.3 113.1 112.6 113.7 105.7 109.0 112.3 114.2 113.4 115.3 106.2 109.0 112.7 114.6 113.4 116.3 106.5 109.3 113.3 115.2 114.2 116.6 107.2 110.0 113.3 115.2 114.0 116.7 107.2 110.0 109.9 107.4 109.7 110.2 110.1 109.8 110.6 111.3 111.8 112.8 113.3 113.4 2 3 4 5 6 7 Industry groupings 8 Manufacturing 9 Capacity utilization, manufacturing (percent) 2 82.3 78.2 77.8 78.1 77.9 77.5 77.9 78.3 78.5 79.0 79.2 79.1 95.3 89.7 92.8 89.0 90.0 89.0 104.0 92.0 90.0 100.0 95.0 n.a. 11 Nonagricultural employment, total 4 12 Goods-producing, total 13 Manufacturing, total 14 Manufacturing, production worker 15 Service-producing 16 Personal income, total 17 Wages and salary disbursements 18 Manufacturing 19 Disposable personal income 5 20 Retail sales 6 107.4 101.0 100.5 100.1 109.5 122.7 121.3 113.5 122.9 120.2 r 106.0 96.4 97.0 96.1 109.0 127.0 124.4 113.6 128.0 121.3 r 106.1 94.8 95.6 95.2 109.7 133.0 129.0 115.4 134.7 127. r 106.3 94.9 95.9 95.5 109.9 132.8 128.7 115.5 134.5 126.6 r 106.2 94.6 95.4 94.9 109.9 133.0 129.6 115.3 134.6 127.3 r 106.2 94.3 95.2 94.6 110.0 133.6 129.5 115.3 135.2 128.l r 106.2 94.2 94.9 94.3 110.1 135.3 r 130.5 116.5 137.0 r 130.7 r 106.3 94.2 95.0 94.6 110.2 135.3 131.2 116.0 136.8 130.5 106.4 94.2 94.9 94.7 110.3 136.6 132.3 118.0 138.2 131.9 106.5 94.2 95.1 95.2 110.5 137.3 133.0 117.1 138.7 132.0 106.9 94.6 95.2 95.2 110.8 137.5 132.9 117.8 139.0 131.5 106.9 94.3 95.2 95.2 110.9 n.a. n.a. n.a. n.a. 130.2 Prices7 71 Consumer ( 1 9 8 2 - 8 4 = 100) 22 Producer finished goods (1982=100) 130.7 119.2 136.2 121.7 140.3 123.2 140.5 123.7 140.9 123.6 141.3 123.3 141.8 124.4 r 142.0 124.0 141.9 123.8 142.6 124.0 143.1 124.3 143.6 124.6 10 Construction contracts 3 1. A major revision of the industrial production index and the capacity utilization rates was released in April 1990. See "Industrial Production: 1989 Developments and Historical R e v i s i o n , " Federal Reserve Bulletin, vol. 76 (April 1990), pp. 187-204. 2. Ratio of index of production to index of capacity. Based on data from the Federal Reserve, DRI McGraw-Hill, U . S . Department of Commerce, and other sources. 3. Index of dollar value of total construction contracts, including residential, nonresidential, and heavy engineering, from McGraw-Hill Information Systems Co., F . W . D o d g e Division. 4. Based on data from U . S . Department of Labor, Employment and Earnings. Series covers employees only, excluding personnel in the armed forces. 5. Based on data from U . S . Department of Commerce, Survey of Current Business. 6. Based on data from U . S . Bureau of the Census, Survey of Current Business. 7. Based on data not seasonally adjusted. Seasonally adjusted data for changes in the price indexes can be obtained from the Bureau of Labor Statistics, U . S . Department of Labor, Monthly Labor Review. NOTE. Basic data (not indexes) for series mentioned in notes 4, 5,and 6, and indexes for series mentioned in notes 3 and 7 can also b e found in the Survey of Current Business. Figures for industrial production for the latest month are preliminary, and many figures for the three months preceding the latest month have been revised. S e e "Recent Developments in Industrial Capacity and Utilization," Federal Reserve Bulletin, vol. 76 (June 1990), pp. 411-35. Selected Measures 2.11 A45 LABOR FORCE, EMPLOYMENT, A N D UNEMPLOYMENT Thousands of persons; monthly data seasonally adjusted except as noted 1993 1992 Category 1990 1991 1992 Aug. Sept. Oct. Nov. Dec. Jan. r Feb. Mar. H O U S E H O L D SURVEY D A T A 1 Noninstitutional population 1 190,216 191,883 193,542 193,749 193,893 194,051 194,210 194,379 194,514 194,641 194,829 2 Labor force (including Armed Forces) 1 3 Civilian labor force Employment 4 Nonagricultural industries 5 Agriculture Unemployment 6 Number 7 Rate (percent of civilian labor f o r c e ) . . . . 8 Not in labor force 126,954 124,787 127,421 125,303 128,948 126,982 129,363 127,404 129,220 127,274 128,986 127,066 129,259 127,365 129,461 127,591 128,953 127,083 129,182 127,327 129,299 127,429 114,728 3,186 114,644 3,233 114,391 3,207 114,562 3,218 114,503 3,221 114,518 3,169 114,855 3,209 115,049 3,262 114,879 3,191 115,335 3,116 115,483 3,082 6,874 5.5 63,262 8,426 6.7 64,462 9,384 7.4 64,594 9,624 7.6 64,386 9,550 7.5 64,673 9,379 7.4 65,065 9,301 7.3 64,951 9,280 7.3 64,918 9,013 7.1 65,561 8,876 7.0 65,459 8,864 7.0 65,904 109,782 108,310 108,434 108,485 108,497 108,571 108,646 108,752 r 108,865 109,232 109,210 19,117 710 5,133 5,808 25,877 6,729 28,130 18,304 18,455 691 4,685 5,772 25,328 6,678 28,323 18,380 18,192 635 4,594 5,741 25,120 6,672 28,903 18,578 18,145 626 4,591 5,729 25,070 6,661 28,981 18,682 18,102 620 4,574 5,738 25,079 6,669 29,065 18,650 18,046 623 4,601 5,731 25,115 6,680 29,152 18,623 18,068 622 4,590 5,732 25,092 6,669 29,188 18,685 18,062 r 619 4,582 r 5,742 r 25,132 r 6,677 29,253 r 18,685r 18,092 616 4,559 5,763 25,222 6,682 29,267 18,664 18,112 604 4,652 5,765 25,367 6,680 29,366 18,686 18,103 607 4,593 5,772 25,362 6,673 29,426 18,674 ESTABLISHMENT SURVEY D A T A 9 Nonagricultural payroll employment 3 10 11 12 13 14 15 16 17 Manufacturing Mining Contract construction Transportation and public utilities Trade Finance Service Government 1. Persons sixteen years of age and older. Monthly figures are based on sample data collected during the calendar week that contains the twelfth day; annual data are averages of monthly figures. By definition, seasonality does not exist in population figures. 2. Includes self-employed, unpaid family, and domestic service workers. 3. Includes all full- and part-time employees who worked during, or received pay for, the pay period that includes the twelfth day of the month; excludes proprietors, self-employed persons, household and unpaid family workers, and members of the armed forces. Data are adjusted to the March 1984 benchmark, and only seasonally adjusted data are available at this time. SOURCE. Based on data from U . S . Department of Labor, Employment and Earnings. A46 Domestic Nonfinancial Statistics • June 1993 2.12 OUTPUT, CAPACITY, A N D CAPACITY UTILIZATION1 Seasonally adjusted 1992 1992 Q2 Q3 Q4r Ql Q2 1992 Q3 Q4 Ql Capacity (percent of 1987 output) Output (1987=100) Q2 1993 Q3 Q4r Ql Capacity utilization rate (percent) 1 Total industry 108.5 109.1 110.4 111.8 137.7 138.4 139.1 139.8 78.8 78.8 79.3 2 Manufacturing 109.5 110.0 111.2 113.2 140.6 141.4 142.2 143.0 77.9 77.8 78.2 79.1 3 4 Primary processing Advanced processing 105.4 111.4 106.4 111.7 107.1 113.2 108.8 115.2 129.6 145.6 129.9 146.7 130.3 147.7 130.6 148.8 81.3 76.5 81.9 76.2 82.2 76.6 83.3 77.4 5 6 7 8 9 10 11 12 13 Durable goods Lumber and products Primary metals Iron and steel Nonferrous Nonelectrical machinery Electrical machinery Motor vehicles and parts Aerospace and miscellaneous transportation equipment . 108.4 96.7 101.7 101.6 101.7 125.7 111.8 100.5 108.8 98.5 104.0 104.6 103.0 128.8 112.6 98.1 110.3 101.3 104.5 106.7 101.6 132.5 113.7 103.7 113.0 103.6 107.6 110.0 104.2 140.1 116.4 111.1 144.4 126.1 128.3 132.7 122.2 165.9 149.1 136.7 145.2 126.3 127.5 131.2 122.3 167.4 150.4 137.2 146.0 126.5 126.7 129.8 122.4 168.9 151.6 137.7 146.8 126.7 126.0 128.5 122.5 170.6 152.9 138.3 75.0 76.7 79.2 76.6 83.3 75.8 75.0 73.5 74.9 78.0 81.5 79.7 84.3 76.9 74.9 71.5 75.6 80.1 82.5 82.2 83.0 78.5 74.9 75.3 77.0 81.8 85.4 85.6 85.1 82.2 76.1 80.3 96.8 94.9 93.1 89.9 140.9 141.5 142.1 142.7 68.7 67.1 65.5 63.0 14 15 16 17 18 19 Nondurable goods Textile mill products Paper and products Chemicals and products Plastics materials Petroleum products 110.9 106.2 106.7 116.8 129.7 109.2 111.6 106.6 108.2 118.0 132.4 106.9 112.4 107.1 107.5 119.3 126.3 110.4 113.3 109.1 108.6 120.7 148.7 110.6 135.6 119.2 119.9 144.3 150.5 121.5 136.5 119.7 120.5 145.1 152.2 121.6 137.4 120.2 121.1 146.0 154.0 121.7 138.2 120.7 121.7 146.9 83.7 121.7 81.7 89.0 89.0 81.0 86.2 89.9 81.8 89.1 89.8 81.3 87.0 87.9 81.9 89.1 88.8 81.7 82.0 90.7 82.0 90.4 89.3 82.2 85.3 90.8 98.9 107.4 110.3 99.2 109.4 113.2 98.9 112.4 115.5 95.7 113.4 116.2 114.7 129.8 126.0 114.8 130.1 126.4 114.8 130.4 126.8 114.8 130.7 127.1 86.2 82.7 87.6 86.5 84.1 89.5 86.2 86.2 91.1 83.3 86.8 91.4 20 Mining 71 Utilities 22 Electric Previous cycle 2 High Low Latest cycle 3 1992 Low Mar. High 1992 Aug. Sept. Oct. 79.9 1993 Nov. Dec. r Jan. r Feb. r Mar. p Capacity utilization rate (percent) 1 Total industry 89.2 72.6 87.3 71.8 78.4 78.8 78.6 79.0 79.4 r 79.6 79.8 80.1 79.9 2 Manufacturing 88.9 70.8 87.3 70.0 77.5 77.9 77.5 77.9 78.3r 78.5 79.0 79.2 79.1 3 4 92.2 87.5 68.9 72.0 89.7 86.3 66.8 71.4 80.8 76.1 81.7 76.3 81.3 76.0 81.9 76.3 82.5r 76.6 82.2 77.0 83.0 77.4 83.5 77.5 83.5 77.3 75.5r so^ 76.0 79.6 82.4 82.3 82.5 80.0 74.8 77.9 76.7 82.5 83.4 82.9 84.1 81.0 75.4 81.4 77.2 81.7 86.5 87.1 85.6 82.4 76.4 80.2 77.1 81.1 86.4 86.9 85.6 83.0 76.7 79.4 Primary processing Advanced processing 5 6 7 8 9 10 11 12 13 Durable goods Lumber and products Primary metals Iron and steel Nonferrous Nonelectrical machinery Electrical machinery Motor vehicles and parts Aerospace and miscellaneous transportation equipment. 88.8 90.1 100.6 105.8 92.9 96.4 87.8 93.4 68.5 62.2 66.2 66.6 61.3 74.5 63.8 51.1 86.9 87.6 102.4 110.4 90.5 92.1 89.4 93.0 65.0 60.9 46.8 38.3 62.2 64.9 71.1 44.5 74.3 78.8 78.7 76.7 81.8 74.5 74.8 69.1 75.2 78.3 81.8 79.5 85.2 77.3 75.1 72.5 74.4 76.6 80.1 78.8 82.2 76.9 74.3 70.8 75.1 79.7 82.0 81.6 82.7 77.4 74.5 73.6 83.8 78.Cr 75.6 74.3r 77.0 66.6 81.1 66.9 70.2 67.0 66.4 66.3 65.5r 64.8 64.1 62.9 62.0 14 15 16 17 18 19 Nondurable goods Textile mill products Paper and products Chemicals and products Plastics materials Petroleum products 87.9 92.0 96.9 87.9 102.0 96.7 71.8 60.4 69.0 69.9 50.6 81.1 87.0 91.7 94.2 85.1 90.9 89.5 76.9 73.8 82.0 70.1 63.4 68.2 81.7 88.5 88.5 79.9 85.0 90.3 81.6 88.7 88.2 81.1 86.0 85.8 81.7 88.9 90.0 81.4 85.1 88.3 81.7 88.4 87.8 81.4 82.8 91.5 82.0 89.4r 88.9 82. l r 84.1 91.0 81.9 89.5 89.6 81.6 79.1 89.7 82.1 91.3 89.1 82.2 85.2 89.7 82.0 90.4 88.6 82.2 85.3 91.7 81.8 89.6 90.0 82.1 85.4 91.1 94.4 95.6 99.0 88.4 82.5 82.7 96.6 88.3 88.3 80.6 76.2 78.7 84.9 83.1 88.1 86.1 83.6 89.2 85.6 84.6 89.9 86.1 85.0 89.8 86.6r 86.2r 91.0r 85.8 87.5 92.5 85.4 84.3 88.7 82.8 87.7 92.4 81.8 88.3 93.1 7.0 Mining 71 Utilities 22 Electric 1. Data in this table also appear in the Board's G.17 (419) monthly statistical release. For ordering address, see inside front cover. For a detailed description of the series, see "Recent Developments in Industrial Capacity and Utilization," Federal Reserve Bulletin, vol. 76 (June 1990), pp. 411-35. 83.l r 82.6rr 2. Monthly high, 1973; monthly low, 1975. 3. Monthly highs, 1978 through 1980; monthly lows, 1982. Selected Measures 2.13 I N D U S T R I A L PRODUCTION A47 Indexes and Gross Value 1 Monthly data seasonally adjusted portion 1993 1992 1987 Group 1992 avg. Mar. Apr. May June July Aug. Sept. Oct. Nov. r Dec. r Jan. r Feb. r Mar. p Index (1987 = 100) MAJOR MARKETS 100.0 108.7 107.6 108.1 108.9 108.5 109.4 109.1 108.9 109.7 110.4 111.0 111.4 112.0 112.0 ? Products Final products 4 Consumer goods, total s Durable consumer goods 6 Automotive products 7 Autos and trucks 8 Autos, consumer 9 Trucks, consumer 10 Auto parts and allied g o o d s . . . 11 Other Appliances, A/C, and TV V Carpeting and furniture N 14 Miscellaneous home goods . . . 15 Nondurable consumer goods Foods and tobacco If. 17 Clothing Chemical products 18 Paper products 19 70 Energy Fuels 71 Residential utilities 22 60.8 46.0 26.0 5.6 2.5 1.5 .9 .6 1.0 3.1 .8 .9 1.4 20.4 9.1 2.6 3.5 2.5 2.7 .7 2.0 109.5 111.1 110.5 107.9 106.6 102.0 90.0 122.1 113.6 108.9 104.7 102.5 115.3 111.2 108.5 95.2 122.6 124.2 108.1 104.7 109.4 108.5 109.8 109.3 106.2 103.6 95.7 81.9 118.8 115.5 108.3 103.5 102.5 114.7 110.2 107.8 95.1 119.4 124.6 107.0 103.7 108.2 109.0 110.6 110.1 107.9 106.5 102.5 93.1 118.3 112.5 109.1 103.4 104.4 115.2 110.7 107.6 95.3 120.8 125.1 108.9 105.1 110.3 109.7 111.4 110.8 111.1 110.6 107.8 98.6 123.3 114.8 111.5 107.4 105.9 117.3 110.7 107.7 96.4 121.4 124.3 107.2 104.0 108.4 109.0 110.5 109.6 109.2 108.0 104.0 97.6 114.8 114.0 110.2 106.2 103.2 116.9 109.7 107.2 95.5 121.6 121.7 104.8 104.4 105.0 109.6 111.0 110.4 108.6 106.6 100.5 92.3 114.3 115.7 110.3 102.3 103.8 118.8 110.8 108.6 96.8 121.5 121.9 107.4 105.3 108.2 109.8 111.5 110.8 109.2 106.8 100.6 87.2 123.1 116.2 111.1 110.6 103.6 116.1 111.2 110.1 95.0 122.0 121.8 106.2 99.0 108.9 109.6 111.2 110.7 106.9 104.5 98.2 88.1 115.1 114.0 108.9 108.5 100.9 114.2 111.7 108.9 95.5 124.1 124.2 108.1 103.5 109.7 110.7 112.4 111.9 108.1 108.8 105.9 88.5 135.1 113.3 107.6 103.8 100.5 114.3 112.9 109.8 94.9 126.8 124.1 111.5 110.3 112.0 111.3 113.1 112.6 108.9 110.2 107.2 89.4 137.1 114.7 107.8 103.8 101.4 114.1 113.7 110.1 95.4 128.3 126.1 112.2 108.0 113.7 112.3 114.2 113.4 111.1 114.3 116.5 97.7 148.1 111.0 108.6 104.0 102.3 115.2 114.0 109.9 96.0 129.1 126.0 114.0 105.7 117.1 112.7 114.6 113.4 113.3 119.4 123.9 102.3 160.3 112.5 108.6 102.6 104.5 114.5 113.4 109.9 95.6 128.7 125.6 110.1 106.1 111.6 113.3 115.2 114.2 114.3 119.0 120.3 101.8 151.4 116.9 110.6 108.7 105.8 114.7 114.2 110.6 94.9 128.5 125.8 114.7 109.5 116.7 113.3 115.2 114.0 114.3 118.0 118.2 100.5 147.9 117.7 111.4 113.1 105.2 114.4 114.0 110.1 95.3 128.3 125.9 114.6 106.7 117.5 20.0 13.9 5.6 1.9 4.0 2.5 1.2 1.9 5.4 .6 .2 111.9 124.5 141.2 176.8 102.3 131.2 101.2 114.1 82.9 78.3 108.8 110.4 121.5 136.0 164.9 101.3 128.9 95.0 112.2 85.6 76.2 98.7 111.3 123.0 137.9 168.2 101.7 131.7 101.3 113.2 84.7 79.2 100.7 112.3 124.5 139.2 170.5 103.4 133.3 105.6 115.0 84.2 79.2 100.3 111.6 124.1 140.4 174.0 102.9 131.8 101.7 111.5 83.6 74.6 97.1 111.8 124.4 141.9 178.0 103.4 128.7 98.1 112.2 82.7 78.6 112.0 112.5 125.9 143.5 182.0 102.7 132.6 101.3 114.4 81.8 75.0 106.1 111.9 125.4 143.5 184.0 101.6 130.4 99.1 115.8 81.1 74.4 111.2 113.0 126.8 145.7 187.0 102.0 133.0 105.2 115.5 80.5 80.2 119.9 113.7 127.8 146.8 189.0 103.1 134.1 107.7 115.9 79.7 85.2 127.1 115.3 130.2 149.9 198.5 104.5 136.7 114.4 118.0 78.9 88.5 138.0 116.3 131.8 152.1 205.0 105.1 140.2 121.4 118.2 78.4 84.7 143.0 116.6 133.0 155.2 214.1 105.5 138.0 119.8 119.3 77.5 76.6 141.3 116.7 133.4 157.0 30 31 37 33 Equipment Business equipment Information processing and related . . Office and computing Industrial Transit Autos and trucks Other Defense and space equipment Oil and gas well drilling Manufactured homes 34 35 36 Intermediate products, total Construction supplies Business supplies 14.7 6.0 8.7 104.6 97.4 109.5 104.4 96.7 109.7 103.9 96.5 109.0 104.4 97.8 109.0 104.4 97.2 109.4 105.1 98.6 109.7 104.4 98.5 108.5 104.5 97.1 109.6 105.5 98.5 110.4 105.7 98.8 110.5 106.2 98.4 111.6 106.5 99.5 111.4 107.2 100.7 111.7 107.2 100.5 111.9 37 Materials 38 Durable goods materials 39 Durable consumer parts Equipment parts 4ft Other 41 Basic metal materials 47 43 Nondurable goods materials 44 Textile materials 45 Pulp and paper materials 46 Chemical materials 47 Other Energy materials 48 49 Primary energy Converted fuel materials 50 39.2 19.4 4.2 7.3 7.9 2.8 9.0 1.2 1.9 3.8 2.1 10.9 7.2 3.7 107.5 109.9 101.0 116.3 108.8 108.3 109.7 102.6 109.8 110.2 112.5 101.2 100.3 103.0 106.1 108.3 97.9 115.1 107.5 106.3 108.9 102.0 107.8 109.3 112.7 100.1 98.2 103.8 106.8 108.7 99.3 114.7 108.1 106.3 109.4 103.2 109.2 109.9 112.2 101.3 99.8 104.1 107.7 110.4 102.5 116.2 109.2 108.3 109.7 102.9 107.8 111.2 112.4 101.3 99.7 104.3 107.6 110.2 102.9 116.2 108.7 107.7 110.4 102.3 110.8 110.9 113.4 100.6 99.6 102.6 109.0 111.2 101.8 117.5 110.2 111.5 111.7 103.9 111.8 113.4 112.8 102.9 102.3 104.1 108.1 111.1 103.9 117.0 109.5 110.9 110.3 102.9 108.9 111.9 112.6 100.9 101.4 100.0 107.9 109.9 102.3 116.4 108.1 108.1 110.5 103.9 112.7 110.9 111.5 102.0 101.8 102.5 108.2 110.9 103.5 117.2 109.1 108.5 109.7 103.3 109.6 110.2 112.6 102.0 102.1 101.7 109.0 112.0 103.8 118.7 110.2 111.3 110.6 103.8 111.0 111.1 112.9 102.4 102.3 102.4 109.0 112.1 104.0 119.1 109.9 108.8 110.2 102.7 113.2 109.0 114.1 102.3 101.9 103.1 109.3 113.4 104.8 121.0 111.0 109.6 111.6 104.7 110.3 112.0 115.6 100.1 99.9 100.5 110.0 114.4 105.2 122.3 112.1 111.5 111.7 104.4 111.1 112.5 114.9 100.6 98.7 104.4 110.0 114.4 105.0 122.5 111.8 111.2 112.5 103.4 114.4 113.2 114.6 100.3 97.9 104.9 97.3 95.3 108.9 109.2 107.9 108.2 108.3 108.6 109.0 109.2 108.6 108.8 109.6 109.9 109.3 109.6 109.2 109.5 109.8 110.1 110.5 110.8 110.9 111.2 111.0 111.3 111.8 112.0 111.8 112.1 1 Total index 73 74 75 76 77 78 79 105.4 136.3 118.1 120.1 77.1 72.2 SPECIAL AGGREGATES 51 Total excluding autos and trucks 52 Total excluding motor vehicles and parts . . . 53 Total excluding office and computing machines 54 Consumer goods excluding autos and trucks 55 Consumer goods excluding energy 56 Business equipment excluding autos and trucks 57 Business equipment excluding office and computing equipment 58 Materials excluding energy 97.5 107.0 106.1 106.6 107.4 106.8 107.6 107.3 107.0 107.8 108.4 108.8 109.0 109.4 109.3 24.5 23.3 111.0 110.7 110.2 109.6 110.6 110.3 110.9 111.2 109.9 110.1 111.0 110.7 111.4 111.3 111.4 111.0 112.2 111.9 113.0 112.7 113.2 113.3 112.7 113.7 113.8 114.1 113.8 114.0 12.7 126.8 124.1 125.2 126.4 126.3 127.0 128.3 127.9 128.9 129.7 131.7 132.9 134.2 134.9 12.0 116.1 109.8 114.5 108.5 115.7 108.9 117.1 110.2 116.1 110.3 115.8 111.3 116.8 110.8 115.9 110.1 117.0 110.5 117.9 111.6 119.1 111.5 120.0 112.8 119.9 113.6 119.7 113.8 28.4 A48 Domestic Nonfinancial Statistics • June 1993 2.13—Continued Group SIC code 1987 proportion 1992 1993 1992 avg. Mar. Apr. May June July Aug. Sept. Oct. Nov. r Dec. r Jan. r Feb/ Mar.P Index (1987 = 100) MAJOR INDUSTRIES 100.0 108.7 107.6 108.1 108.9 108.5 109.4 109.1 108.9 109.7 110.4 111.0 111.4 112.0 112.0 2 Manufacturing 3 Primary processing 4 Advanced processing 84.4 26.7 57.7 109.7 105.7 111.5 108.5 104.5 110.3 109.0 105.0 110.8 109.9 105.6 111.9 109.6 105.6 111.4 110.2 107.3 111.6 110.1 106.2 112.0 109.8 105.7 111.7 110.6 106.6 112.5 111.3 107.4 113.1 111.8 107.2 114.0 112.8 108.3 114.8 113.3 109.0 115.3 113.4 109.1 115.4 5 6 7 8 Durable goods "'24 Lumber and products . . . 25 Furniture and fixtures . . . d a y , glass, and stone 32 products Primary metals 33 331,2 Iron and steel Raw steel 333-6,9 Nonferrous Fabricated metal 34 products 35 Nonelectrical machinery. Office and computing 357 machines 36 Electrical machinery . . . . Transportation 37 equipment Motor vehicles and 371 parts Autos and light trucks Aerospace and miscellaneous transportation equipment.. 3 7 2 - 6 , 9 38 Instruments 39 Miscellaneous 47.3 2.0 1.4 108.5 98.6 100.2 107.0 99.2 98.6 107.6 97.2 101.1 109.1 97.4 103.3 108.5 95.4 100.3 109.0 99.8 101.0 109.2 98.9 101.7 108.2 96.7 100.5 109.5 100.8 99.6 110.2 102.3 99.5 111.2 100.7 100.5 112.4 104.4 101.4 113.3 103.5 103.4 113.4 102.8 103.3 2.5 3.3 1.9 .1 1.4 96.2 103.0 104.1 101.2 101.6 95.0 101.4 102.5 98.8 99.9 95.6 100.9 100.9 99.9 100.9 96.7 102.0 102.2 98.5 101.8 96.6 102.1 101.8 101.5 102.5 97.1 105.6 106.4 105.3 104.4 96.4 104.3 104.4 101.9 104.2 96.1 102.0 103.0 99.8 100.5 97.7 104.2 106.3 101.7 101.2 97.8 105.3 107.2 101.5 102.6 98.3 104.2 106.5 100.4 101.0 98.2 105.2 106.8 106.6 103.0 99.0 109.0 111.9 106.9 104.9 99.2 108.6 111.2 5.4 8.6 101.8 127.3 100.0 122.9 100.6 124.1 102.2 126.7 102.2 126.4 102.6 127.8 102.5 129.3 101.3 129.1 102.9 130.4 103.4 131.7 104.5 135.5 105.2 137.8 105.2 140.6 105.2 142.0 2.5 8.6 176.8 111.9 164.9 110.9 168.2 111.0 170.5 112.3 174.0 112.2 178.0 112.6 182.0 113.0 184.0 112.1 187.0 112.7 189.0 114.6 198.5 113.7 205.0 114.9 214.1 116.8 218.3 117.6 Nondurable goods Foods Tobacco products Textile mill products Apparel products Paper and products Printing and publishing . . Chemicals and products . Petroleum products Rubber and plastic products Leather and products . . . 1 Total index 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 Mining 35 Metal 36 Coal 37 Oil and gas extraction 38 Stone and earth minerals . . 39 Utilities 40 Electric 41 Gas 104!9 9.8 97.2 96.5 98.0 99.6 98.2 96.7 97.0 95.6 97.5 97.5 99.4 101.3 99.8 98.7 4.7 98.7 94.2 98.5 102.7 100.4 97.7 99.4 97.2 101.2 102.4 107.4 112.5 111.0 109.9 2.3 100.2 93.7 101.1 106.5 103.0 99.3 98.6 96.7 103.1 104.6 113.7 120.7 117.6 115.6 5.1 3.3 1.2 96.0 118.1 119.5 98.6 118.6 120.0 97.4 119.0 118.9 96.8 119.8 118.4 96.3 118.5 117.8 95.7 118.5 120.4 94.9 118.2 118.2 94.1 118.1 118.6 94.1 117.8 119.7 93.0 116.8 120.0 92.2 116.8 120.3 91.3 116.2 118.8 89.7 116.2 118.1 88.6 116.4 118.0 "20 21 22 23 26 27 28 29 37.2 8.8 1.0 1.8 2.4 3.6 6.4 8.6 1.3 111.2 110.1 105.3 106.0 97.7 107.1 113.3 117.1 108.6 110.4 110.2 101.3 105.3 97.8 105.8 113.8 114.8 109.7 110.7 109.6 101.0 106.3 98.0 107.0 113.7 115.8 110.3 110.9 109.3 102.5 106.8 99.0 105.8 113.4 117.0 108.5 111.0 109.0 103.6 105.3 98.1 107.3 113.0 117.5 108.9 111.7 109.8 106.6 107.1 99.4 109.6 112.3 118.0 109.1 111.3 110.6 115.9 106.1 97.6 106.3 111.4 117.6 104.3 111.8 110.2 110.5 106.6 97.6 108.6 113.2 118.3 107.4 112.0 111.2 107.6 106.1 97.2 106.2 113.4 118.7 111.3 112.7 111.5 107.7 107.4 97.8 107.6 113.6 119.9 110.7 112.7 111.1 108.1 107.7 97.9 108.7 114.6 119.3 109.1 113.2 111.8 108.7 110.0 97.5 108.3 114.3 120.5 109.2 113.4 112.1 108.5 109.1 97.3 107.8 114.4 120.8 111.7 113.3 111.9 106.3 108.3 97.6 109.7 114.2 120.9 110.9 30 31 3.0 .3 117.2 85.3 115.4 82.9 116.5 84.1 117.1 86.2 117.3 86.2 118.5 87.1 119.0 84.8 117.3 86.4 118.3 87.0 119.3 86.0 119.3 86.9 119.7 87.1 120.5 87.3 120.1 87.1 "lO 11,12 13 14 7.9 .3 1.2 5.7 .7 98.8 158.0 105.5 93.2 105.8 97.5 155.8 103.0 91.9 107.4 99.1 154.2 104.0 94.2 105.9 99.7 166.4 107.6 93.4 108.0 98.0 154.0 98.6 93.9 105.6 100.6 163.7 112.0 94.0 106.2 98.8 165.6 107.5 92.4 106.4 98.3 158.6 103.7 93.0 105.2 98.8 155.7 103.9 93.9 104.9 99.4 167.1 106.8 93.4 105.5 98.5 159.7 106.7 92.6 104.7 98.0 156.9 110.1 91.3 105.6 95.1 157.8 103.4 88.8 104.1 94.0 157.8 99.2 88.1 104.8 7.6 6.0 1.6 108.6 111.6 97.6 107.7 110.7 96.7 108.2 49i,3PT 492,3PT 97.7 107.3 110.2 96.6 106.7 109.7 95.3 109.3 113.0 95.4 108.8 112.7 94.1 110.2 113.8 97.0 110.7 113.7 99.6 112.4 115.3 101.3 114.2 117.4 102.4 110.1 112.6 100.5 114.6 117.4 104.1 115.6 118.5 104.9 79.8 110.3 109.3 109.6 110.3 110.1 110.9 110.7 110.5 111.1 111.8 112.1 112.8 113.4 113.6 82.0 107.6 106.8 107.2 108.1 107.6 108.2 108.0 107.6 108.3 109.0 109.2 110.0 110.3 110.2 111.0 SPECIAL AGGREGATES 42 Manufacturing excluding motor vehicles and parts 43 Manufacturing excluding office and computing machines Gross value (billions of 1982 dollars, annual rates) MAJOR MARKETS 44 Products, total 1,734.8 1,932.5 1,902.8 1,918.7 1,935.5 1,920.1 1,936.2 1,935.9 1,937.0 1,969.8 1,981.4 2,001.9 2,024.1 2,041.6 2,040.3 45 Final 46 Consumer goods 47 Equipment 48 Intermediate 1,350.9 1,529.8 1,501.5 1,518.2 1,532.1 1,519.1 1,530.4 1,532.8 1,534.6 1,563.8 1,572.2 1,593.5 1,612.8 1,627.8 1,625.2 912.4 896.2 905.6 909.3 905.3 907.1 833.4 907.9 901.3 928.2 935.5 931.3 943.4 950.8 945.3 612.7 619.7 621.0 627.5 517.5 621.9 605.3 617.8 627.5 635.6 640.9 658.0 669.5 677.0 679.9 400.5 403.4 401.2 405.8 403.1 402.7 401.1 402.4 384.0 406.0 408.5 409.1 411.3 413.8 415.1 1. Data in this table also appear in the Board's G.17 (419) monthly statistical release. For ordering address, see inside front cover. A major revision of the industrial production index and the capacity utilization rates was released in April 1990. See "Industrial Production: 1989 Developments and Historical Revision," Federal Reserve Bulletin, vol. 76 (April 1990), pp. 187-204. 2. Standard industrial classification, Selected Measures 2.14 A49 HOUSING A N D CONSTRUCTION Monthly figures at seasonally adjusted annual rates except as noted 1993 1992 Item 1990 1991 1992 R May June July Aug. Sept. Oct." Nov." Dec." Jan. Feb. 1,138 955 183 1,189 1,040 149 644 510 134 1,264 1,054 210 262 Private residential real estate activity (thousands of units except as noted) N E W UNITS 1 2 3 4 5 6 7 8 9 10 11 12 13 Permits authorized One-family Two-or-more-family Started One-family Two-or-more-family Under construction at end of period . . One-family Two-or-more-family Completed One-family Two-or-more-family Mobile homes shipped Merchant builder activity in one-family units 14 Number sold 15 Number for sale at end of period Price of units sold of dollars) 16 Median 17 Average ... 1,111 794 317 1,193 895 298 711 449 262 1,308 966 342 188 535 321 949 754 195 1,014 840 174 606 434 173 1,091 838 253 171 507 284 R 1,097 913 184 1,200 1,030 169 612 473 140 1,158 964 194 210 1,054 879 175 1,197 1,019 178 650" 483 R 167 R L,194 R L,002 R 192 R 194 1,032 872 160 1,141 994 147 641" 481" 160 1,181" 979" 202 194 1,080 879 201 1,106 961 145 628 474" 154" 1,234" 1,026" 208" 210 1,076 877 199 1,229 1,038 191 633 479" 154" 1,133" 945" 188" 202 1,125 913 212 1,218 1,045 173 637" 485" 152 1,128" 942" 186" 217 1,139 959 180 1,226 1,079 147 645 493 152 1,137 964 173 228 1,126 955 171 1,226 1,089 137 641 498 143 1,229 1,002 227 244 1,201 1,044 157 1,286 1,133 153 501 143 1,227 1,016 211 266 1,180 997 183 1,171 1,051 120 646 507 139 1,130 973 157 267 609 265 552 R 273" 584" 273" 622" 271 625" 270" 672" 267" 637 264 615 262 652 265 569 267 595 271 644 (thousands 122.3 149.0 120.0 147.0 121.2 144.7 113.0 146.0 124.5 146.6 118.0 137.7 123.5 145.3 119.5 142.2 125.0 148.4 128.9 147.2 125.0 144.0 118.0 139.9 126.7 146.3 3,211 3,219 3,520 3,450" 3,320" 3,380" 3,340" 3,380" 3,710 3,860 4,040 3,780 3,460 95.2 118.3 99.7 127.4 103.6 130.8 103.1" 131.0" 105.5" 133.9" 102.8" 132.2 105.0" 132.4" 103.5" 131.0 103.4 129.3 102.7 128.8 104.2 131.0 103.1 129.4 103.6 129.6 EXISTING U N I T S ( o n e - f a m i l y ) 18 Number sold Price of units sold of dollars) 19 Median 20 Average (thousands Value of new construction (millions of dollars) 3 CONSTRUCTION 21 Total put in place 442,066 400,955 426,657 427,980 426,730 425,700 419,598 429,291 432,250 436,140 439,948 437,897 438,384 22 Private 73 Residential 24 Nonresidential, total 25 Industrial buildings 26 Commercial buildings 27 Other buildings 28 Public utilities and other 334,153 182,856 151,297 23,849 62,866 21,591 42,991 290,707 157,837 132,870 22,281 48,482 20,797 41,310 308,246 184,127 124,119 20,173 40,417 21,514 42,015 306,999 182,892 124,107 21,008 39,643 21,993 41,463 312,182 184,630 127,552 20,285 43,310 21,991 41,966 305,848 181,162 124,686 20,594 39,988 22,228 41,876 301,984 184,201 117,783 17,862 37,010 21,518 41,393 308,813 186,343 122,470 19,019 39,333 22,068 42,050 315,855 192,553 123,302 18,646 40,195 21,545 42,916 317,451 194,801 122,650 19,083 40,379 21,542 41,646 320,720 198,538 122,182 18,721 38,326 21,370 43,765 324,415 201,198 123,217 18,661 39,331 20,952 44,273 324,133 200,650 123,483 18,567 39,173 22,646 43,097 29 Public 30 Military 31 Highway Conservation and d e v e l o p m e n t . . . 32 Other 33 107,909 2,664 31,154 4,607 69,484 110,247 1,837 29,918 4,958 73,534 118,408 2,484 32,759 5,978 77,187 120,981 2,668 32,633 5,767 79,913 114,548 2,503 31,496 5,889 74,660 119,853 2,372 32,682 5,772 79,027 117,614 2,438 33,451 5,382 76,343 120,478 3,172 34,651 6,364 76,291 116,395 2,438 32,056 5,630 76,271 118,689 2,612 34,636 6,210 75,231 119,229 2,483 31,237 8,237 77,272 113,481 2,482 29,694 5,720 75,585 114,251 2,424 30,770 6,678 74,379 1. Not at annual rates. 2. Not seasonally adjusted. 3. Recent data on value of new construction may not be strictly comparable with data for previous periods because of changes by the Census Bureau in its estimating techniques. For a description of these changes, see Construction Reports (C-30-76-5), issued by the Census Bureau in July 1976. SOURCE. Census Bureau estimates for all series except (1) mobile homes, which are private, domestic shipments as reported by the Manufactured Housing Institute and seasonally adjusted by the Census Bureau, and (2) sales and prices of existing units, which are published by the National Association of Realtors. All back and current figures are available from the originating agency. Permit authorizations are those reported to the Census Bureau from 17,000 jurisdictions beginning in 1984. A50 2.15 Domestic Nonfinancial Statistics • June 1993 CONSUMER A N D PRODUCER PRICES Percentage changes based on seasonally adjusted data except as noted Change from 12 months earlier Change from 3 months earlier (annual rate) Item 1992 1992 Mar. Change from 1 month earlier 1993 Index level, Mar. 1993 1 19931 1992 1993 Mar. June Sept. Dec. Mar. Nov. Dec. Jan. Feb. Mar. C O N S U M E R PRICES 2 (1982-84=100) 1 All items 3.2 3.1 2.6 2.6 3.2 4.0 .2 .1 .5 .3 .1 143.6 2 Food 3 Energy items 4 All items less food and energy 5 Commodities 6 Services 1.7 -.8 3.9 3.1 4.2 1.4 3.6 3.4 2.6 3.7 -1.2 8.6 2.8 2.5 3.1 3.2 1.2 2.5 1.8 2.9 1.4 1.9 3.8 1.5 4.7 2.6 3.1 4.3 4.6 4.4 .1 .2 .3 .1 .4 .3 -.2 .2 -.1 .3 .4 .5 .5 .5 .4 .1 -.4 .5 .5 .4 .1 .7 .1 .1 .2 140.1 102.5 151.4 135.5 160.5 1.1 -1.5 -1.5 2.9 2.1 2.0 1.1 4.3 2.0 1.6 3.3 -.6 16.6 2.4 .9 1.3 4.3 -3.5 1.5 1.2 -.3 2.9 -9.8 .9 .3 3.9 -1.9 16.6 3.2 3.8 -,2r -,6r - 1.3r .2 ,2r 1.2r -2.3 .1 .2 -.9 .9 .4 .3 .4 -.1 1.7 .3 .5 .4 .5 1.3 .1 .2 124.6 124.6 77.6 139.4 130.9 -.6 2.2 1.8 5.0 1.7 .7 1.3 -1.4 -.3 4.6 4.3 -,2r .or .R -.2 .2 .3 .3 .5 .5 .3 .2 116.2 123.8 -2.5 -6.2 -3.1 8.0 -4.8 19.8 2.2 4.3 -20.2 1.5 1.9 -6.9 25.4 -,5r 1.0 -5.5r 2.1 r .3 .0 3.1 .1 -2.5 2.2 .1 .8 .4 138.4 PRODUCER PRICES (1982=100) 7 8 9 10 11 Finished goods Consumer foods Consumer energy Other consumer goods Capital equipment Intermediate materials 12 Excluding foods and feeds 13 Excluding energy Crude materials 14 Foods 15 Energy 16 Other .9 2.7 7.8 51.5 4.8 1. Not seasonally adjusted. 2. Figures for consumer prices are for all urban consumers and reflect a rental-equivalence measure of homeownership. -.9 L.R .(F .R SOURCE. Bureau of Labor Statistics. 108.2 77.8 Selected Measures 2.16 A51 GROSS DOMESTIC PRODUCT A N D INCOME Billions of current dollars except as noted; quarterly data at seasonally adjusted annual rates 1992 1991 Account 1990 1991 1992r Q4 Ql Q2 Q4r Q3 GROSS DOMESTIC P R O D U C T 5,522.2 5,677.5 5,950.7 5,753.3 5,840.2 5,902.2 5,978.5 6,081.8 3,748.4 464.3 1,224.5 2,059.7 3,887.7 446.1 1,251.5 2,190.1 4,095.8 480.4 1,290.7 2,324.7 3,942.9 450.4 1,251.4 2,241.1 4,022.8 469.4 1,274.1 2,279.3 4,057.1 470.6 1,277.5 2,309.0 4,108.7 482.5 1,292.8 2,333.3 4,194.8 499.1 1,318.6 2,377.1 799.5 793.2 577.6 201.1 376.5 215.6 721.1 731.3 541.1 180.1 360.9 190.3 770.4 766.0 548.2 168.4 379.9 217.7 736.1 726.9 528.7 169.7 358.9 198.2 722.4 738.2 531.0 170.1 360.8 207.2 773.2 765.1 550.3 170.3 380.0 214.8 781.6 766.6 549.6 166.1 383.5 217.0 804.3 794.0 562.1 167.0 395.1 231.9 6.3 3.3 -10.2 -10.3 4.4 2.2 9.2 14.5 -15.8 -13.3 8.1 6.4 15.0 9.7 10.3 6.2 -68.9 557.0 625.9 -21.8 598.2 620.0 -30.4 636.3 666.7 -16.0 622.9 638.9 -8.1 628.1 636.2 -37.1 625.4 662.5 -36.0 639.0 675.0 -40.5 652.7 693.2 1,043.2 426.4 616.8 1,090.5 447.3 643.2 1,114.9 449.1 665.8 1,090.3 440.8 649.5 1,103.1 445.0 658.0 1,109.1 444.8 664.3 1,124.2 455.2 669.0 1,123.3 451.6 671.7 5,515.9 2,160.1 920.6 1,239.5 2,846.4 509.4 5,687.7 2,192.8 907.6 1,285.1 3,030.3 464.7 5,946.3 2,260.3 943.9 1,316.4 3,197.1 488.8 5,744.2 2,188.4 905.7 1,282.7 3,090.3 465.5 5,855.9 2,233.6 923.6 1,310.0 3,142.2 480.1 5,894.1 2,233.2 932.3 1,300.8 3,173.4 487.6 5,963.5 2,258.4 943.8 1,314.6 3,217.8 487.3 6,071.5 2,316.1 975.8 1,340.3 3,255.1 500.3 6.3 -.9 7.2 -10.2 -19.3 9.0 4.4 -3.5 7.9 9.2 -8.1 17.3 -15.8 -19.3 3.5 8.1 9.5 -1.4 15.0 2.7 12.3 10.3 -6.9 17.2 4,877.5 4,821.0 4,922.6 4,838.5 4,873.7 4,892.4 4,933.7 4,990.8 30 4,468.3 4,544.2 4,744.1 4,599.1 4,679.4 4,716.5 4,719.6 4,860.7 31 Compensation of employees 3,291.2 2,742.9 514.8 2,228.0 548.4 277.4 271.0 3,390.8 2,812.2 543.5 2,268.7 578.7 290.4 288.3 3,525.2 2,916.6 562.5 2,354.1 608.6 302.9 305.7 3,433.8 2,845.0 546.4 2,298.6 588.7 293.7 295.0 3,476.3 2,877.6 554.6 2,323.0 598.7 299.4 299.2 3,506.3 2,901.3 561.4 2,339.9 605.0 301.5 303.6 3,534.3 2,923.5 564.3 2,359.1 610.8 302.9 307.9 3,583.7 2,963.9 569.6 2,394.3 619.8 307.6 312.2 38 Proprietors' income 1 39 Business and professional 40 Farm 1 366.9 325.2 41.7 368.0 332.2 35.8 404.5 364.9 39.5 377.9 340.0 37.9 393.6 353.6 40.1 398.4 359.9 38.5 397.4 365.9 31.5 428.4 380.4 48.1 41 Rental income of persons 2 -12.3 -10.4 4.7 -6.6 -4.5 3.3 6.4 13.6 4? Corporate profits 1 43 Profits before tax 3 44 Inventory valuation adjustment 45 Capital consumption adjustment 361.7 355.4 -14.2 20.5 346.3 334.7 3.1 8.4 394.5 372.3 -7.4 29.5 347.1 332.3 14.1 384.0 366.1 -5.4 23.3 388.4 376.8 -15.5 27.0 374.1 354.1 -9.7 29.7 431.3 392.2 1.0 38.1 46 Net interest 460.7 449.5 415.2 446.9 430.0 420.0 407.3 403.6 1 By source 7 Personal consumption expenditures 3 4 5 Nondurable goods 6 Gross private domestic investment 7 Fixed investment Nonresidential 8 9 Structures 10 Producers' durable equipment Residential structures 11 12 13 Change in business inventories Nonfarm 14 Net exports of goods and services 15 16 Imports Government purchases of goods and services 17 18 19 State and local By major type of product 7 0 Final sales, total 71 ?? 73 74 25 Services Structures 2.6 Change in business inventories 27 Durable goods 28 Nondurable goods MEMO 29 Total GDP in 1987 dollars N A T I O N A L INCOME 37 33 34 35 36 37 Wages and salaries Government and government enterprises Other Supplement to wages and salaries Employer contributions for social insurance Other labor income 1. With inventory valuation and capital consumption adjustments. 2. With capital consumption adjustment. .7 3. For after-tax profits, dividends, and the like, see table 1.48. SOURCE. U.S. Department of Commerce, Survey of Current Business. A52 2.17 Domestic Nonfinancial Statistics • June 1993 PERSONAL INCOME A N D SAVING Billions of current dollars except as noted; quarterly data at seasonally adjusted annual rates 1992 1991 1990 Account 1991 1992r Q4 Ql Q2 Q4R Q3 PERSONAL INCOME A N D S A V I N G 1 Total personal income 4,664.2 4,828.3 5,058.1 4,907.2 4,980.5 5,028.9 5,062.0 5,160.9 2 Wage and salary disbursements 3 Commodity-producing industries 2,742.8 745.6 556.1 634.6 847.8 514.8 2,812.2 737.4 556.9 647.4 883.9 543.6 2,918.1 743.2 565.7 666.8 945.5 562.5 2,845.0 741.5 563.9 652.9 904.3 546.4 2,877.6 736.8 559.9 660.9 925.3 554.6 2,901.3 743.1 564.7 662.9 933.9 561.4 2,923.5 742.4 565.5 667.7 949.1 564.3 2,969.9 750.6 572.8 675.8 973.9 569.6 271.0 366.9 325.2 41.7 -12.3 140.3 694.5 685.8 352.0 288.3 368.0 332.2 35.8 -10.4 137.0 700.6 771.1 382.0 305.7 404.5 364.9 39.5 4.7 139.3 670.2 866.1 414.1 295.0 377.9 340.0 37.9 -6.6 134.3 703.3 799.8 390.6 299.2 393.6 353.6 40.1 -4.5 133.9 684.8 842.7 405.7 303.6 398.4 359.9 38.5 3.3 136.6 675.2 859.7 412.1 307.9 397.4 365.9 31.5 6.4 141.0 663.2 874.1 417.1 312.2 428.4 380.4 48.1 13.6 145.8 657.8 888.0 421.6 7 Government and government enterprises 9 Proprietors' income 1 10 Business and professional 1 11 Farm 1 12 Rental income of persons 2 15 Transfer payments 16 Old-age survivors, disability, and health insurance benefits 17 ... LESS: Personal contributions for social insurance 18 EQUALS: Personal income 224.8 238.4 250.6 241.5 246.8 249.3 251.5 254.8 4,664.2 4,828.3 5,058.1 4,907.2 4,980.5 5,028.9 5,062.0 5,160.9 621.3 618.7 627.3 622.3 619.6 617.1 628.8 643.6 20 EQUALS: Disposable personal income 4,042.9 4,209.6 4,430.8 4,284.9 4,360.9 4,411.8 4,433.2 4,517.3 21 LESS: Personal outlays 3,867.3 4,009.9 4,218.1 4,065.5 4,146.3 4,179.5 4,229.9 4,316.9 22 EQUALS: Personal saving 175.6 199.6 212.6 219.4 214.6 232.3 203.3 200.4 19,513.0 13,043.6 14,068.0 19,077.1 12,824.1 13,886.0 19,271.4 12,973.9 14,035.0 19,066.0 12,802.6 13,913.0 19,158.5 12,930.2 14,017.0 19,181.8 12,893.3 14,021.0 19,288.4 12,973.3 13,998.0 19,456.3 13,098.4 14,105.0 4.3 4.7 4.8 5.1 4.9 5.3 4.6 4.4 19 LESS: Personal tax and nontax payments MEMO Per capita (19S7 dollars) 24 Personal consumption expenditures 25 Disposable personal income 26 Saving rate (percent) GROSS S A V I N G 27 Gross saving 718.0 708.2 687.0 698.2 677.5 682.9 696.9 690.7 28 Gross private saving 854.1 901.5 969.2 934.8 950.1 968.1 992.1 966.6 29 Personal saving 30 Undistributed corporate profits 31 Corporate inventory valuation adjustment 175.6 75.7 -14.2 199.6 75.8 3.1 212.6 104.7 -7.4 219.4 78.3 .7 214.6 104.0 -5.4 232.3 97.7 -15.5 203.3 91.2 -9.7 200.4 125.7 1.0 368.3 234.6 383.0 243.1 394.8 258.6 386.3 250.7 386.1 245.3 391.2 247.0 407.2 290.4 394.7 251.8 Federal State and local -136.1 -166.2 30.1 -193.3 -210.4 17.1 -282.2 -297.8 15.5 -236.6 -258.7 22.0 -272.6 -289.2 16.6 -285.2 -302.9 17.7 -295.2 -304.4 9.2 -276.0 -294.6 18.6 37 Gross investment 723.4 730.1 720.4 714.6 706.5 713.8 732.0 729.5 38 Gross private domestic 39 Net foreign 799.5 -76.1 721.1 9.0 770.4 -49.9 736.1 -21.5 722.4 -16.0 773.2 -59.4 781.6 -49.6 804.3 -74.7 5.4 21.9 33.4 16.4 29.0 30.9 35.1 38.9 Capital consumption allowances 33 Noncorporate 34 Government surplus, or deficit ( - ) , national income and 35 36 40 Statistical discrepancy 1. With inventory valuation and capital consumption adjustments. 2. With capital consumption adjustment. SOURCE. U.S. Department of Commerce, Survey of Current Business. Summary Statistics 3.10 U.S. INTERNATIONAL TRANSACTIONS A53 Summary Millions of dollars; quarterly data seasonally adjusted except as noted 1 1992 1991 1990 1 Balance on current a c c o u n t . . 2 Merchandise trade balance 3 Merchandise exports 4 Merchandise imports 5 Military transactions, net 6 Other service transactions, net 7 Investmentincome.net 8 U.S. government grants 9 U.S. government pensions and other transfers 10 Private remittances and other transfers 11 Change in U.S. government assets other than official reserve assets, net (increase, - ) 1992 1991 -90,428 -108,853 388,705 -497,558 -7,818 39,873 19,287 -17,597 -2,945 -12,374 -3,682 -73,436 415,962 -489,398 -5,524 50,821 16,429 24,487 -3,462 -12,996 Q4 Ql Q2 Q3R Q4P -62,448 -96,275 439,272 -535,547 -2,503 57,628 10,062 -13,832 -3,736 -13,793 -7,218 -18,539 107,851 -126,390 -540 13,676 2,458 78 -1,080 -3,271 —6,374r -17,663 r 107,634r -125,297 r -624 14,450* 4,394 r -2,620 -8301 -3,481 r -18,279* -25,004* 107,148* -132,152* -623 13,242* 1,851* -3,085 -1,119* -3,541* -15,771 -27,634 110,119 -137,753 -579 16,315 2,977 -2,521 -941 -3,388 -22,020 -25,974 114,371 -140,345 -677 13,625 839 -5,605 -846 -3,382 2,304 3,397 -959 -437 -38 -277 -301 -344 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 -2,158 0 -192 731 -2,697 5,763 0 -177 -367 6,307 3,901 0 2,316 -2,692 4,277 1,225 0 -23 17 1,232 -1,057 0 -172 111 -9% 1,464 0 -168 1 1,631 1,952 0 -173 -118 2,243 1,542 0 2,829 -2,685 1,398 17 Change in U.S. private assets abroad (increase, - ) 18 Bank-reported claims 3 19 Nonbank-reported claims 20 U.S. purchases of foreign securities, net 21 U.S. direct investments abroad, net -56,467 7,469 -2,477 -28,765 -32,694 -71,379 -4,753 5,526 -45,017 -27,135 -47,843 32,372 3,742 -48,646 -35,311 -44,947 -23,219 1,269 -11,305 -11,692 —3,614r 15,859 4,764 -8,703 -15,534 r -1,610* -22,892 -1,274 -4,159 -13,934 -3,525 -19,726 6,844 22 Change in foreign official assets in United States (increase, +) . . 23 U.S. Treasury securities 24 Other U.S. government obligations 25 Other U.S. government liabilities4 26 Other U.S. liabilities reported by U.S. banks 3 27 Other foreign official assets 5 33,908 29,576 667 1,866 3,385 -1,586 18,407 15,815 1,301 40,307 18,333 4,025 2,469 16,168 12,819 12,619 1,075 -344 -914 383 21,192 14,909 540 % 5,534 113 20,895 11,126 1,699 598 7,547 -75 -7,269 -323 912 929 -7,787 5,489 -7,379 874 846 10,874 274 28 Change in foreign private assets in United States (increase, + ) . . 29 U.S. bank-reported liabilities3 30 U.S. nonbank-reported liabilities 31 Foreign private purchases of U.S. Treasury securities, net 32 Foreign purchases of other U.S. securities, net 33 Foreign direct investments in United States, net 65,471 16,370 4,906 -2,534 1,592 45,137 80,093 14,667 4,413 35,077 29,884 -3,948 36,110 23,465 725 1,408 4,832 5,680 -2,577 r -4,474 1,942 -828 4,551 —3,768r 26,571* -551 1,141 10,286 10,333 5,362* 29,246 22,905 1,330 4,870 2,693 -2,552 26,854 -3,213 34 Allocation of special drawing rights 35 Discrepancy 36 Due to seasonal adjustment 37 Before seasonal adjustment 0 0 0 47,370 -1,078 -13,051 47,370 -13,052 0 -7,532 r 4,901* -12,433 0 -28,764* 1,296* -30,060 0 15,035 -6,640 21,675 0 8,205 439 7,767 — I,078 0 2,447 613 1,835 1,600 -1,668 1,359 48,573 -13,678 -405 16,241 34,918 11,498 10,943 3,137 -8,221 -7,469* -1,000 -17,788 -8,782 20,749 12,307 -2,989 MEMO Changes in official assets 38 U.S. official reserve assets (increase, - ) 39 Foreign official assets in United States, excluding line 25 (increase, + ) 40 Change in Organization of Petroleum Exporting Countries official assets in United States (part of line 22) -2,158 5,763 3,901 1,225 -1,057 1,464 1,952 1,542 32,042 16,807 37,838 13,163 21,096 20,297 -8,198 4,643 1,707 -5,604 5,402 1,023 2,459 -2,125 3,062 2,006 1. Seasonal factors not calculated for lines 12-16, 18-20, 22-34, and 38-40. 2. Data are on an international accounts basis. The data differ from the Census basis data, shown in table 3.11, for reasons of coverage and timing. Military exports are excluded from merchandise trade data and are included in line 6. 3. Reporting banks include all types of depository institution as well as some brokers and dealers. 4. Associated primarily with military sales contracts and other transactions arranged with or through foreign official agencies. 5. Consists of investments in U.S. corporate stocks and in debt securities of private corporations and state and local governments. SOURCE. U.S. Department of Commerce, Survey of Current Business. A54 3.11 International Statistics • June 1993 U . S . FOREIGN TRADE 1 Millions of dollars; monthly data seasonally adjusted 1992 Item 1 Exports of domestic and foreign merchandise, excluding grant-aid shipments 2 General imports including merchandise for immediate consumption plus entries into bonded warehouses 3 Trade balance 1990 393,592 1991 421,730 448,115 Aug. Sept. Oct. Nov. Dec. r Jan. r Feb.P 35,799 37,882 39,072 38,187 39,671 37,148 37,181 495,311 487,129 532,380 44,974 46,551 46,324 45,535 46,562 44,306 44,378 -101,718 -65,399 -84,265 -9,174 -8,669 -7,252 -7,348 -6,891 -7,159 -7,197 1. Government and nongovernment shipments of merchandise between foreign countries and the fifty states, including the District of Columbia, Puerto Rico, the U . S . Virgin Islands, and U . S . Foreign Trade Zones. Data exclude (1) shipments among the United States, Puerto Rico, the U.S. Virgin Islands, and other U.S. affiliated insular areas, (2) shipments to U.S. Armed Forces and diplomatic missions abroad for their own use, (3) U . S . goods, returned to the United States by its Armed Forces, (4) personal and household effects of travelers, and (5) in-transit shipments. Data reflect the total arrival of merchandise from foreign countries that immediately entered consumption channels, warehouses, or U.S. Foreign Trade Zones (general imports). Import data are Customs value; export data are F . A . S . value. Beginning in 1990, data for U.S. exports to Canada are derived from import data compiled by Canada; similarly, in Canadian statistics, Canadian exports to the United States are derived from import data compiled by 3.12 1993 1992 the United States. Since Jan. 1, 1987, merchandise trade data have been released forty-five days after the end of the month; the previous month is revised to reflect late documents. Data in this table differ from figures for merchandise trade shown in the U.S. balance of payments accounts (table 3.10, lines 2 to 4) primarily for reasons of coverage. For both exports and imports a large part of the difference is the treatment of military sales and purchases. The militap' sales to foreigners (exports) and purchases from foreigners (imports) that are included in this table as merchandise trade are shifted, in the balance of payments accounts, from "merchandise trade" into the broader category "military transactions." SOURCE. FT900, U.S. Merchandise Trade, (U.S. Department of Commerce, Bureau of the Census). U.S. RESERVE ASSETS Millions of dollars, end of period 1992 Asset 1 Total 2 Gold stock, including Exchange Stabilization Fund 1 3 Special drawing rights2'3 4 Reserve position in International Monetary Fund 2 5 Foreign currencies 1989 1990 Sept. Oct. Nov. Dec. Jan. Feb. Mar." 74,609 83,316 77,719 78,527 74,207 72,231 71,323 71,962 72,847 74,378 11,059 9,951 11,058 10,989 11,057 11,240 11,059 12,111 11,060 11,561 11,059 11,495 11,056 8,503 11,055 8,546 11,055 8,651 11,054 8,787 9,048 44,551 9,076 52,193 9,488 45,934 9,778 45,579 9,261 42,325 8,781 40,896 11,759 40,005 12,079 40,282 12,021 41,120 12,184 42,353 1. Gold held "under earmark" at Federal Reserve Banks for foreign and international accounts is not included in the gold stock of the United States; see table 3.13, line 3. Gold stock is valued at $42.22 per fine troy ounce. 2. Special drawing rights (SDRs) are valued according to a technique adopted by the International Monetary Fund (IMF) in July 1974. Values are based on a weighted average of exchange rates for the currencies of member countries. From July 1974 through December 1980, 16 currencies were used; since January 1981, 3.13 1993 1991 5 currencies have been used. U.S. SDR holdings and reserve positions in the IMF also have been valued on this basis since July 1974. 3. Includes allocations of SDRs by the International Monetary Fund on Jan. 1 of the year indicated, as follows: 1970—$867 million; 1971—$717 million; 1972— $710 million; 1979—$1,139 million; 1980—$1,152 million; 1981—$1,093 million; plus net transactions in SDRs. 4. Valued at current market exchange rates. FOREIGN OFFICIAL A S S E T S H E L D AT F E D E R A L R E S E R V E B A N K S 1 Millions of dollars, end of period 1992 Asset 1989 1990 Sept. 1 Deposits Held in custody 2 U . S . Treasury securities 3 Earmarked gold Oct. Nov. Dec. Jan. Feb. Mar." 589 369 968 546 415 229 205 325 296 317 224,911 13,456 278,499 13,387 281,107 13,303 306,971 13,241 311,538 13,201 308,959 13,192 314,481 13,686 324,356 13,077 329,183 13,074 326,486 12,989 1. Excludes deposits and U.S. Treasury securities held for international and regional organizations. 2. Marketable U . S . Treasury bills, notes, and bonds and nonmarketable U.S. Treasury securities payable at face value in dollars or foreign currencies. 1993 1991 3. Held for foreign and international accounts and valued at $42.22 per fine troy ounce; not included in the gold stock of the United States. Summary Statistics 3.14 FOREIGN BRANCHES OF U.S. BANKS A55 Balance Sheet Data 1 Millions of dollars, end of period 1993 1992 Account 1989 1990 1991 Aug. r Sept. r Oct/ Nov. Dec/ Jan. Feb. All foreign countries ASSETS Total payable in any currency 545,366 556,925 548,901 544,887 545,388 554,253 566,721 r 542,286 543,760 554,280 7 Claims on United States 3 Parent bank Other banks in United States 4 5 Nonbanks 6 Claims on foreigners 7 Other branches of parent bank 8 Banks 9 Public borrowers 10 Nonbank foreigners 11 Other assets 198,835 157,092 17,042 24,701 300,575 113,810 90,703 16,456 79,606 45,956 188,4% 148,837 13,296 26,363 312,449 135,003 72,602 17,555 87,289 55,980 176,301 137,509 12,884 25,908 303,934 111,729 81,970 18,652 91,583 68,666 163,103 128,267 9,181 25,655 321,707 116,604 87,347 20,450 97,306 60,077 167,419 134,119 8,083 25,217 320,111 118,952 83,756 20,511 %,892 57,858 174,986 138,940 10,683 25,363 319,139 115,521 86,560 20,809 %,249 60,128 177,443R 141,542R 25,882 328,592R 125,143 86,086R 20,378 %,985 60,686R 166,798 132,275 9,703 24,820 318,071 123,256 82,190 20,756 91,869 57,417 169,278 134,217 9,571 25,490 314,737 116,325 81,811 19,984 %,617 59,745 169,765 136,253 9,249 24,263 320,407 117,862 84,439 19,822 98,284 64,108 1 lO.O^ 12 Total payable in U.S. dollars 382,498 379,479 363,941 341,109 347,181 364,080 374,398 r 365,800 353,564 361,251 N 14 15 16 17 18 19 20 71 22 Claims on United States Parent bank Other banks in United States Nonbanks Claims on foreigners Other branches of parent bank Banks Public borrowers Nonbank foreigners Other assets 191,184 152,294 16,386 22,504 169,690 82,949 48,396 10,961 27,384 21,624 180,174 142,962 12,513 24,699 174,451 95,298 36,440 12,298 30,415 24,854 169,662 133,476 12,025 24,161 167,010 78,114 41,635 13,685 33,576 27,269 157,469 124,737 8,876 23,856 161,663 70,689 40,350 13,686 36,938 21,977 161,463 130,446 7,476 23,541 166,762 72,348 42,274 13,990 38,150 18,956 169,290 136,156 9,360 23,774 173,457 76,098 45,436 13,966 37,957 21,333 171,938R 138,424R 9,291R 24,223 182,347R 83,902 45,931R 13,995 38,519 20,113R 162,125 129,329 9,266 23,530 183,555 83,117 47,250 14,313 38,875 20,120 164,681 131,553 9,214 23,914 171,041 77,606 41,450 13,883 38,102 17,842 165,234 133,733 8,704 22,797 177,265 80,220 43,067 13,710 40,268 18,752 United Kingdom 23 Total payable in any currency 161,947 184,818 175,599 165,754 161,966 168,063 168,333 165,591 164,360 165,132 24 25 7.6 28 29 30 31 37 33 Claims on United States Parent bank Other banks in United States Nonbanks Claims on foreigners Other branches of parent bank Banks Public borrowers Nonbank foreigners Other assets 39,212 35,847 1,058 2,307 107,657 37,728 36,159 3,293 30,477 15,078 45,560 42,413 792 2,355 115,536 46,367 31,604 3,860 33,705 23,722 35,257 31,931 1,267 2,059 109,692 35,735 36,394 3,306 34,257 30,650 37,511 34,593 744 2,174 108,895 37,732 37,711 3,046 30,406 19,348 35,891 32,929 1,067 1,895 107,675 38,894 36,039 3,371 29,371 18,400 39,558 36,413 1,400 1,745 109,919 40,594 36,701 3,692 28,932 18,586 38,358 35,027 925 2,406 113,193 45,092 34,559 3,370 30,172 16,782 36,403 33,460 1,298 1,645 111,623 46,165 33,399 3,329 28,730 17,565 37,609 34,290 886 2,433 108,362 42,894 33,513 3,059 28,8% 18,389 32,380 30,240 783 1,357 112,959 43,856 36,601 2,542 29,960 19,793 34 Total payable in U.S. dollars 103,208 116,762 105,974 99,661 100,664 107,342 109,479 109,449 101,209 99,755 36,404 34,329 843 1,232 59,062 29,872 16,579 2,371 10,240 7,742 41,259 39,609 334 1,316 63,701 37,142 13,135 3,143 10,281 11,802 32,418 30,370 822 1,226 58,791 28,667 15,219 2,853 12,052 14,765 34,948 32,786 625 1,537 55,812 26,825 15,565 2,353 11,069 8,901 33,618 31,578 711 1,329 59,338 28,225 16,800 2,604 11,709 7,708 37,359 35,299 769 1,291 61,658 30,217 17,269 2,515 11,657 8,325 35,956 33,765 438 1,753 65,164 34,434 16,848 2,501 11,381 34,508 32,186 1,022 1,300 66,335 34,124 17,089 2,349 12,773 35,481 33,070 684 1,727 59,339 30,823 14,150 2,154 12,212 30,390 29,020 428 942 63,234 31,395 16,800 1,883 13,156 8,359 8,606 6,389 6,131 71 35 Claims on United States 16 Parent bank Other banks in United States 37 38 Nonbanks 3 9 Claims on foreigners 40 Other branches of parent bank 41 Banks 42 Public borrowers 43 Nonbank foreigners 4 4 Other assets Bahamas and Cayman Islands 45 Total payable in any currency 176,006 162,316 168,326 144,327 145,786 154,293 156,176 r 147,422 144,894 151,175 46 Claims on United States 47 Parent bank 48 Other banks in United States 49 Nonbanks 50 Claims on foreigners 51 Other branches of parent bank 57 Banks 53 Public borrowers 54 Nonbank foreigners 55 Other assets 124,205 87,882 15,071 21,252 44,168 11,309 22,611 5,217 5,031 7,633 112,989 77,873 11,869 23,247 41,356 13,416 16,310 5,807 5,823 7,971 115,244 81,520 10,907 22,817 45,229 11,098 20,174 7,161 6,7% 7,853 94,659 64,454 8,060 22,145 41,486 8,5% 17,570 7,152 8,168 8,182 96,911 68,309 6,562 22,040 41,884 7,753 18,412 7,128 8,591 6,991 102,726 72,207 8,199 22,320 42,844 7,287 19,840 7,146 8,571 8,723 104,245 r 73,856 r 8,282 r 22,107 44,156 r 8,238 20,122 r 7,209 8,587 7,775 r %,280 66,608 7,828 21,844 44,509 7,293 21,212 7,786 8,218 6,633 %,976 67,219 7,%2 21,795 41,185 7,041 18,464 7,564 8,116 6,733 102,836 73,825 7,892 21,119 40,821 7,311 17,440 7,422 8,648 7,518 56 Total payable in U.S. dollars 170,780 158,390 163,771 138,584 140,104 149,304 151,436 r 142,861 140,332 146,809 1. Since June 1984, reported claims held by foreign branches have been reduced by an increase in the reporting threshold for "shell" branches from $50 million to $150 million equivalent in total assets, the threshold now applicable to all reporting branches. A56 3.14 International Statistics • June 1993 FOREIGN BRANCHES OF U.S. BANKS Balance Sheet Data 1 —Continued 1992 Aug. r Sept. r 1993 Oct. r Nov. Dec.' Jan. Feb. All foreign countries LIABILITIES 57 Total payable in any currency 545,366 556,925 548,901 544,887 545,388 554,253 566,721 r 542,286 543,760 554,280 58 59 60 61 62 Negotiable certificates of deposit (CDs) . . To United States Parent bank Other banks in United States Nonbanks 23,500 197,239 138,412 11,704 47,123 18,060 189,412 138,748 7,463 43,201 16,284 198,121 136,431 13,260 48,430 14,246 179,476 126,976 10,971 41,529 12,389 185,380 127,573 12,408 45,399 12,056 188,979 132,999 12,281 43,699 12,342 188,004R 131,806R 13,392R 42,806R 10,032 189,332 134,227 12,182 42,923 12,320 176,112 122,512 12,829 40,771 11,872 184,042 124,010 12,373 47,659 63 64 65 66 67 68 To foreigners Other branches of parent bank Banks Official institutions Nonbank foreigners Other liabilities 296,850 119,591 76,452 16,750 84,057 27,777 311,668 139,113 58,986 14,791 98,778 37,785 288,254 112,033 63,097 15,596 97,528 46,242 314,823 120,509 68,522 18,237 107,555 36,342 312,390 120,714 68,493 16,720 106,463 35,229 315,400 118,001 70,439 20,572 106,388 37,818 330,314 126,018 74,536 20,645 109,115 36,061 309,704 125,160 62,189 19,731 102,624 33,218 321,052 120,178 67,843 23,655 109,376 34,276 319,638 119,601 70,056 21,469 108,512 38,728 69 Total payable in U.S. dollars 396,613 383,522 370,561 346,223 346,581 364,969 372,320' 368,212 353,411 363,285 70 71 72 73 74 Negotiable CDs To United States Parent bank Other banks in United States Nonbanks 19,619 187,286 132,563 10,519 44,204 14,094 175,654 130,510 6,052 39,092 11,909 185,286 129,669 11,707 43,910 8,755 166,609 119,521 9,866 37,222 7,628 171,086 119,714 11,117 40,255 6,710 176,013 125,491 11,409 39,113 7,503 175,857' 124,658' 12,246R 38,953R 6,238 178,562 127,836 11,512 39,214 7,102 164,595 115,894 11,710 36,991 6,640 172,110 117,115 11,418 43,577 176,460 87,636 30,537 9,873 48,414 179,002 98,128 20,251 7,921 52,702 14,772 158,993 76,601 24,156 10,304 47,932 14,373 157,482 74,060 22,973 10,713 49,736 13,377 155,266 73,208 22,822 9,939 49,297 12,601 165,960 77,197 25,210 12,097 51,456 16,286 175,293 82,957 28,404 12,342 51,590 13,667 171,676 83,700 26,118 12,430 49,428 11,736 169,077 79,144 23,281 14,094 52,558 12,637 170,756 79,594 25,571 14,034 51,557 13,779 To foreigners Other branches of parent bank Banks Official institutions Nonbank foreigners 80 Other liabilities 75 76 77 78 79 13,248 United Kingdom 161,947 184,818 175,599 165,754 161,966 168,063 168,333 165,591 164,360 165,132 82 Negotiable CDs 83 To United States Parent bank 84 85 Other banks in United States 86 Nonbanks 20,056 14,256 11,333 8,083 7,266 36,036 29,726 1,256 5,054 39,928 31,806 1,505 6,617 37,720 29,834 1,438 6,448 35,527 27,695 1,632 6,200 35,885 27,528 1,670 6,687 6,064 35,399 27,427 1,341 6,631 5,636 34,532 26,471 1,689 6,372 4,517 39,174 31,100 1,065 7,009 5,774 33,028 25,098 1,742 6,188 5,597 33,092 24,250 1,633 7,209 87 To foreigners Other branches of parent bank 88 89 Banks Official institutions 90 Nonbank foreigners 91 92 Other liabilities 92,307 27,397 29,780 8,551 26,579 13,548 108,531 36,709 25,126 8,361 38,335 22,103 98,167 30,054 25,541 9,670 32,902 28,379 104,892 31,234 26,435 10,699 36,524 17,252 101,999 30,756 25,823 9,131 36,289 16,816 109,358 33,696 28,792 11,687 35,183 17,242 113,395 35,560 30,609 11,438 35,788 14,770 107,176 35,983 25,231 12,090 33,872 14,724 111,103 35,376 25,%5 14,188 35,574 14,455 110,514 35,143 81 Total payable in any currency 27,227 12,938 35,206 15,929 108,178 116,094 108,755 98,698 95,652 104,521 105,699 108,170 100,731 101,342 94 Negotiable CDs 95 To United States 96 Parent bank 97 Other banks in United States 98 Nonbanks 18,143 33,056 28,812 1,065 3,179 12,710 34,697 29,955 1,156 3,586 10,076 33,003 28,260 1,177 3,566 5,890 30,357 25,873 1,088 3,396 5,689 30,330 25,700 992 3,638 4,213 31,266 26,021 866 4,379 4,494 30,204 25,160 906 4,138 3,894 35,417 29,957 709 4,751 4,770 28,619 23,766 1,063 3,790 4,444 28,874 23,097 99 To foreigners 100 Other branches of parent bank 101 Banks 102 Official institutions Nonbank foreigners 103 104 Other liabilities 50,517 18,384 12,244 5,454 14,435 6,462 60,014 25,957 9,488 4,692 19,877 8,673 56,626 20,800 11,069 7,156 17,601 9,050 54,381 18,983 9,289 6,956 19,153 8,070 51,916 17,986 9,112 6,156 18,662 7,717 59,938 22,080 10,956 8,142 18,760 9,104 62,899 22,8% 13,050 8,459 18,494 8,102 62,048 22,026 12,540 8,847 18,635 6,811 60,033 20,807 9,740 10,114 19,372 7,309 59,643 20,516 10,359 9,%7 156,176' 147,422 144,894 151,175 71,269" 10,944' 34,374' 1,350 111,749 67,235 10,445 34,069 1,355 108,037 65,009 10,265 32,763 110,616 62,223 10,059 38,334 93 Total payable in U.S. dollars 1,097 4,680 18,801 8,381 Bahamas and Cayman Islands 105 Total payable in any currency 176,006 162,316 168,326 144,327 145,786 154,293 106 Negotiable CDs 107 To United States Parent bank 108 Other banks in United States 109 110 Nonbanks 678 124,859 75,188 8,883 40,788 646 114,738 74,941 4,526 35,271 1,173 129,872 79,394 10,231 40,247 1,814 106,049 64,190 8,522 33,337 872 109,296 63,057 9,801 36,438 1,394 114,327 69,537 10,303 34,487 47,382 23,414 8,823 1,097 14,048 3,087 44,444 24,715 5,588 622 13,519 2,488 35,200 17,388 5,662 572 11,578 2,081 34,883 17,315 6,244 935 10,389 1,581 34,060 16,071 6,788 984 10,217 1,558 34,896 15,441 6,988 1,058 11,409 3,676 35,411 16,287 7,574 932 10,618 2,239 32,556 15,169 6,422 805 10,160 1,767 33,766 15,411 6,350 932 11,073 1,736 37,690 18,056 171,250 157,132 163,603 139,100 140,298 149,320 151,527' 143,150 140,734 146,875 111 To foreigners Other branches of parent bank 112 113 Banks 114 Official institutions 115 Nonbank foreigners 1 1 6 Other liabilities 117 Total payable in U.S. dollars 1,939 116,587' 1,142 7,%7 1,036 10,631 1,727 Summary Statistics 3.15 A57 SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS Millions of dollars, end of period 1992r Item 1 Total 1 By type 2 Liabilities reported by banks in the United States 3 U . S . Treasury bills and certificates U.S. Treasury bonds and notes 5 Nonmarketable 6 U . S . securities other than U.S. Treasury securities By area 7 Western Europe 1 9 Latin America and Caribbean 10 Asia 12 Other countries® 1990 Aug. Sept. Oct. Nov. Dec. Jan. r Feb.P 344,529 360,530 407,154 393,687 405,465 394,845 398,672 411,816 412,534 39,880 79,424 38,3% 92,692 52,561 113,307 43,604 113,634 60,933 104,286 54,007 100,702 54,823 104,5% 63,791 111,540 65,753 113,594 202,487 4,491 18,247 203,677 4,858 20,907 213,407 4,476 23,403 208,924 4,505 23,020 211,875 4,473 23,898 211,272 4,503 24,361 210,553 4,532 24,168 207,588 4,563 24,334 203,224 4,592 25,371 167,191 8,671 21,184 138,096 1,434 7,955 168,365 7,460 33,554 139,465 2,092 9,592 196,511 9,990 38,389 151,785 2,860 7,617 186,364 7,027 37,736 151,667 3,360 7,531 194,551 8,111 38,678 153,555 3,481 7,087 184,207 6,381 38,945 154,493 3,779 7,038 188,693 7,920 40,015 152,148 3,565 6,329 196,239 8,411 41,388 156,211 3,705 5,860 198,958 7,886 42,502 154,015 3,866 5,305 1. Includes the Bank for International Settlements. 2. Principally demand deposits, time deposits, bankers acceptances, commercial paper, negotiable time certificates of deposit, and borrowings under repurchase agreements. 3. Includes nonmarketable certificates of indebtedness (including those payable in foreign currencies through 1974) and Treasury bills issued to official institutions of foreign countries. 4. Excludes notes issued to foreign official nonreserve agencies. Includes bonds and notes payable in foreign currencies; zero coupon bonds are included at current value. 3.16 1993 1991 5. Debt securities of U.S. government corporations and federally sponsored agencies, and U.S. corporate stocks and bonds. 6. Includes countries in Oceania and Eastern Europe. SOURCE. Based on Treasury Department data and on data reported to the Treasury Department by banks (including Federal Reserve Banks) and securities dealers in the United States and on the 1984 benchmark survey of foreign portfolio investment in the United States. LIABILITIES TO, A N D CLAIMS ON, FOREIGNERS Reported by Banks in the United States 1 Payable in Foreign Currencies Millions of dollars, end of period 1992r Item 1 Banks' liabilities 2 Banks' claims 3 Deposits 4 Other claims 5 Claims of banks' domestic customers 1. Data on claims exclude foreign currencies held by U.S. authorities. 1989 67,835 65,127 20,491 44,636 3,507 monetary 1990 70,477 66,796 29,672 37,124 6,309 1991 75,129 73,195 26,192 47,003 3,398 Mar. June Sept. Dec. 68,434 60,424 23,270 37,154 2,%2 71,240 58,262 23,466 34,7% 4,375 84,487 72,003 28,074 43,929 3,987 73,225 62,740 24,186 38,554 4,432 2. Assets owned by customers of the reporting bank located in the United States that represent claims on foreigners held by reporting banks for the accounts of the domestic customers. A58 3.17 International Statistics • June 1993 LIABILITIES TO FOREIGNERS Payable in U.S. dollars Reported by Banks in the United States 1 Millions of dollars, end of period 1992r Item 1990 1991 1993 1992r Aug. Sept. Oct. Nov. Dec. Jan. Feb." H O L D E R A N D T Y P E OF LIABILITY 1 Total, all foreigners 759,634 756,066 809,886 769,519 795,856 793,298 799,590 809,886 801,355 813,245 2 Banks' own liabilities 3 Demand deposits 4 Time deposits 5 Other 3 6 Own foreign offices 4 577,229 21,723 168,017 65,822 321,667 575,374 20,321 159,649 66,305 329,099 606,135 21,815 160,541 93,614 330,165 564.732 21,678 143,663 87,631 311,760 587,139 22,479 143,336 84,107 337,217 590,791 21,302 157,488 92,315 319,686 601,073 21,935 156,814 96,294 326,030 606,135 21,815 160,541 93,614 330,165 591,971 21,118 150,310 103,607 316,936 604,524 22,325 147,669 105,048 329,482 182,405 96,796 180,692 110,734 203,751 127,649 204,787 135,744 208,717 134,894 202,507 127,993 198,517 122,480 203,751 127,649 209,384 133,799 208,721 135,399 17,578 68,031 18,664 51,294 21,982 54,120 18,541 50,502 19,349 54,474 20,043 54,471 21,755 54,282 21,982 54,120 22,969 52,616 20,735 52,587 5,918 4,540 36 1,050 3,455 8,981 6,827 43 2,714 4,070 9,350 6,951 46 3,214 3,691 12,914 9,807 21 2,620 7,166 11,285 8,648 24 2,577 6,047 10,727 7,001 73 1,899 5,029 9,915 6,982 58 2,561 4,363 9,350 6,951 46 3,214 3,691 11,086 7,824 39 2,7% 4,989 11,308 8,654 47 2,321 6,286 1,378 364 2,154 1,730 2,399 1,908 3,107 2,654 2,637 1,991 3,726 3,085 2,933 2,371 2,399 1,908 3,262 2,774 2,654 2,348 1,014 0 424 0 486 5 453 0 646 0 641 0 561 1 486 5 488 0 306 0 119,303 34,910 1,924 14,359 18,628 131,088 34,411 2,626 16,504 15,281 159,419 51,058 1,274 17.828 31,956 165,868 49,009 1,676 18,039 29,294 157,238 40,453 1,761 16,125 22,567 165,219 57,225 1,723 19,741 35,761 154,709 50,027 1,492 17,834 30,701 159,419 51,058 1,274 17,828 31,956 175,331 59,576 1,396 18,685 39,495 179,347 61,986 1,763 19,158 41,065 84,393 79,424 96,677 92,692 108,361 104,596 116,859 113,307 116,785 113,634 107,994 104,286 104,682 100,702 108,361 104,596 115,755 111,540 117,361 113,594 4,766 203 3,879 106 3,726 39 3,466 86 2,922 229 3,595 113 3,784 196 3,726 39 4,054 161 3,648 119 540,805 458,470 136,802 10,053 88,541 38,208 321,667 522,265 459,335 130,236 8,648 82,857 38,731 329,099 546,388 475,236 145,071 10,164 90,413 44,494 330,165 501,940 435,244 123,484 9,821 72,820 40,843 311,760 537,936 466,617 129,400 10,443 74,075 44,882 337,217 525,221 454,183 134,497 9,741 85,729 39,027 319,686 543,980 472,949 146,919 10,088 87,690 49,141 326,030 546,388 475,236 145,071 10,164 90,413 44,494 330,165 521,800 453,027 136,091 9,920 80,562 45,609 316,936 529,700 462,202 132,720 10,995 78,228 43,497 329,482 82,335 10,669 62,930 7,471 71,152 11,087 66,696 10,429 71,319 10,905 71,038 10,481 71,031 10,444 71,152 11,087 68,773 9,685 67,498 9,296 5,341 66,325 5,694 49,765 7,568 52,497 6,920 49,347 7,373 53,041 7,325 53,232 7,572 53,015 7,568 52,497 7,708 51,380 6,692 51,510 93,608 79,309 9,711 64,067 5,530 93,732 74,801 9,004 57,574 8,223 94,729 72,890 10,331 49,086 13,473 88,797 70,672 10,160 50,184 10,328 89,397 71,421 10,251 50,559 10,611 92,131 72,382 9,765 50,119 12,498 90,986 71,115 10,297 48,729 12,089 94,729 72,890 10,331 49,086 13,473 93,138 71,544 9,763 48,267 13,514 92,890 71,682 9,520 47,962 14,200 14,299 6,339 18,931 8,841 21,839 10,058 18,125 9,354 17,976 8,364 19,749 10,141 19,871 8,963 21,839 10,058 21,594 9,800 21,208 10,161 6,457 1,503 8,667 1,423 10,202 1,579 7,702 1,069 8,408 1,204 8,482 1,126 9,838 1,070 10,202 1,579 10,719 1,075 10,089 958 7,073 7,456 9,114 7,279 7,452 7,672 7,716 9,114 9,724 9,499 Banks' custodial liabilities 5 U.S. Treasury bills and certificates 6 Other negotiable and readily transferable instruments 7 10 Other 7 8 9 11 Nonmonetary international and regional organizations 8 12 Banks' own liabilities 13 Demand deposits 14 Time deposits 15 Other 3 16 17 18 19 Banks' custodial liabilities 5 U.S. Treasury bills and certificates 6 Other negotiable and readily transferable instruments Other 9 20 Official institutions 21 Banks' own liabilities 22 Demand deposits 23 Time deposits 24 Other 3 25 26 27 28 Banks' custodial liabilities 5 U.S. Treasury bills and certificates 6 Other negotiable and readily transferable instruments 7 Other 29 Banks 1 0 30 Banks' own liabilities 31 Unaffiliated foreign banks 32 Demand deposits 33 Time deposits 34 Other 3 35 Own foreign offices 4 36 37 38 39 Banks' custodial liabilities 5 U.S. Treasury bills and certificates 6 Other negotiable and readily transferable instruments 7 Other 40 Other foreigners 41 Banks' own liabilities 42 Demand deposits 43 Time deposits 44 Other 3 45 46 47 48 Banks' custodial liabilities 5 U.S. Treasury bills and certificates 6 Other negotiable and readily transferable instruments 7 Other MEMO 49 Negotiable time certificates of deposit in custody for foreigners 1. Reporting banks include all types of depository institution, as well as some brokers and dealers. 2. Excludes negotiable time certificates of deposit, which are included in "Other negotiable and readily transferable instruments." 3. Includes borrowing under repurchase agreements. 4. For U.S. banks, includes amounts due to own foreign branches and foreign subsidiaries consolidated in Consolidated Report of Condition filed with bank regulatory agencies. For agencies, branches, and majority-owned subsidiaries of foreign banks, consists principally of amounts due to head office or parent foreign bank, and foreign branches, agencies, or wholly owned subsidiaries of head office or parent foreign bank. 5. Financial claims on residents of the United States, other than long-term securities, held by or through reporting banks. 6. Includes nonmarketable certificates of indebtedness and Treasury bills issued to official institutions of foreign countries. 7. Principally bankers acceptances, commercial paper, and negotiable time certificates of deposit. 8. Principally the International Bank for Reconstruction and Development, the Inter-American Development Bank, and the Asian Development Bank. Excludes "holdings of dollars" of the International Monetary Fund. 9. Foreign central banks, foreign central governments, and the Bank for International Settlements. 10. Excludes central banks, which are included in "Official institutions." Nonbank-Reported Data 3.17—Continued 1993 1992 1990 1991 1992r Aug. Sept. Oct. Nov. Dec.* Jan. Feb." AREA 1 Total, all foreigners 759,634 756,066 809,886 769,519* 795,856* 793,298* 799,590* 809,886 801,355 813,245 2 Foreign countries 753,716 747,085 800,536 756,605* 784,571* 782,571* 789,675* 800,536 790,269 801,937 254,452 1,229 12,382 1,399 602 30,946 7,485 934 17,735 5,350 2,357 2,958 7,544 1,837 36,690 1,169 109,555 928 11,689 119 1,545 249,097 1,193 13,337 937 1,341 31,808 8,619 765 13,541 7,161 1,866 2,184 11,391 2,222 37,238 1,598 100,292 622 9,274 241 3,467 308,391 1,613 20,572 3,060 1,299 41,459 18,631 910 10,041 7,372 3,319 2,465 9,789 2,986 39,440 2,666 112,434 504 25,832 577 3,422 289,957* 1,427 18,455* 1,329 976 29,461* 11,032 934 10,992 10,432* 1,341 2,664 14,904 4,162 40,569 2,021 111,569* 554 22,372* 525 4,238 290,435* 1,456 17,948* 1,760 685 32,158* 14,739 1,069 12,236 10,407* 1,851 2,245 15,589 3,194 39,314 2,087 115,817* 567 12,867 499 3,947 306,547* 1,584 21,183* 1,788 949 34,881* 13,810 872 11,104 8,%2* 1,577 2,258 14,602 5,312* 38,240* 2,524 114,705* 577 27,228 450 3,941 311,875* 1,358 19,662* 1,481 1,144 39,968* 15,401 749 12,494 8,411 2,014 2,255 10,383 4,485 40,791 2,360 117,353* 575 26,691 601 3,699 308,391 1,613 20,572 3,060 1,299 41,459 18,631 910 10,041 7,372 3,319 2,465 9,789 2,986 39,440 2,666 112,434 504 25,832 577 3,422 303,695 1,158 21,255 1,885 1,862 34,285 20,685 815 8,750 8,731 3,550 2,518 14,865 2,%2 41,555 2,533 106,700 506 25,926 436 2,718 304,126 1,937 19,624 2,835 2,049 31,740 18,715 758 10,704 11,778 2,521 2,508 17,163 2,046 39,490 2,862 105,885 512 28,170 447 2,382 3 Europe 4 Austria 5 Belgium and Luxembourg 6 Denmark 7 Finland 8 France 9 Germany 10 Greece 11 Italy 12 Netherlands 13 Norway 14 Portugal 15 Spain 16 Sweden 17 Switzerland 18 Turkey 19 United Kingdom 20 Yugoslavia 11 21 Others in Western Europe 12 22 Russia Other Eastern Europe 13 23 20,349 21,605 22,746 20,410 22,668 21,378 22,052 22,746 21,467 22,870 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 332,997 7,365 107,386 2,822 5,834 147,321 3,145 4,492 11 1,379 1,541 257 16,650 7,357 4,574 1,294 2,520 12,271 6,779 345,529 7,753 100,622 3,178 5,704 163,620 3,283 4,661 2 1,232 1,594 231 19,957 5,592 4,695 1,249 2,0% 13,181 6,879 315,990 9,476 82,213 7,079 5,584 151,934 3,030 4,579 3 987 1,375 371 19,432 5,208 4,190 1,068 1,955 11,370 6,136 311,047* 9,397 82,567* 4,782 5,283 148,212* 3,393 4,711 9 1,214 1,432 272 20,046 4,825 4,303* 1,136* 2,182 10,802 6,481 316,995* 9,065 77,633* 4,275 5,393 159,838* 3,440 4,792 33 1,073 1,416 309 19,650 4,751 4,5%* 1,152* 2,019 11,101 6,459 310,015* 9,387 85,878* 5,889 5,828 143,311* 3,253 4,767 10 1,026 1,376 274 19,216* 4,708 4,116* 1,141* 2,087 11,504 6,244* 309,750* 8,715 86,310* 6,355* 5,235 143,084* 2,925 4,677 11 1,016 1,323 271 19,543 6,101 3,976* 1,047* 2,092 11,003 6,066* 315,990 9,476 82,213 7,079 5,584 151,934 3,030 4,579 3 987 1,375 371 19,432 5,208 4,190 1,068 1,955 11,370 6,136 313,071 10,790 84,557 6,319 5,321 146,875 3,638 4,438 2 945 1,311 294 20,023 4,352 4,013 1,052 1,898 11,106 6,137 319,446 10,606 86,848 6,473 5,551 149,158 3,420 4,417 3 886 1,311 279 21,207 4,871 4,209 1,045 2,098 10,943 6,121 44 Asia China 45 People's Republic of China 46 Republic of China (Taiwan) 47 Hong Kong 48 India 49 Indonesia 50 Israel 51 Japan 52 Korea (South) Philippines 53 54 Thailand 55 Middle Eastern oil-exporting countries 56 Other 136,844 120,462 143,359 125,248* 144,793* 134,385* 136,111* 143,359 141,524 144,656 2,421 11,246 12,754 1,233 1,238 2,767 67,076 2,287 1,585 1,443 15,829 16,965 2,626 11,491 14,269 2,418 1,463 2,015 47,069 2,587 2,449 2,252 15,752 16,071 4,343 7,239 18,445 1,3% 1,480 3,775 58,332 3,336 2,275 5,582 21,446 15,710 2,508 10,362 17,798* 1,480 958 2,620 45,693* 3,644 1,920 4,624 18,938 14,703 2,480 9,431* 18,682* 1,372 1,507 2,613 64,606 r 3,673* 2,028 4,517 19,977 13,907 2,582 8,616* 17,542* 1,234 1,260* 2,208 56,101 r 3,529* 2,275 5,082 19,040 14,916* 2,559* 8,750* 16,322* 1,210* 1,217* 3,691 55,356 r 3,698 r 2,223* 5,797 20,266 15,022 4,343 7,239 18,445 1,3% 1,480 3,775 58,332 3,336 2,275 5,582 21,446 15,710 4,103 7,940 17,510 1,323 1,392 3,389 56,007 3,415 2,350 5,722 19,877 18,4% 4,442 7,641 19,363 1,377 1,462 3,394 58,935 3,459 2,746 5,375 20,498 15,964 57 Africa 58 Egypt 59 Morocco 60 South Africa 61 Zaire 62 Oil-exporting countries 63 Other 4,630 1,425 104 228 53 1,110 1,710 4,825 1,621 79 228 31 1,082 1,784 5,881 2,472 76 190 19 1,346 1,778 5,314 2,143 93 275 24 1,090 1,689 5,592 2,243 100 190 14 1,339 1,706 5,843 2,598 98 240 24 1,201 1,682 6,062 2,601 93 214 23 1,402 1,729 5,881 2,472 76 190 19 1,346 1,778 5,913 2,756 88 158 25 1,125 1,761 6,364 3,077 92 319 17 1,135 1,724 64 Other 65 Australia 66 Other 4,444 3,807 637 5,567 4,464 1,103 4,169 3,047 1,122 4,629 3,322 1,307 4,088 2,927 1,161 4,403 2,987 1,416 3,825 2,654 1,171 4,169 3,047 1,122 4,599 3,502 1,097 4,475 3,388 1,087 67 Nonmonetary international and regional organizations 68 International 16 .. 69 Latin American regional 1 70 Other regional 18 5,918 4,390 1,048 479 8,981 6,485 1,181 1,315 9,350 7,434 1,415 501 12,914* 9,701* 2,309* 904 11,285* 8,204* 2,274* 807 10,727* 7,689 2,130* 908 9,915* 6,764* 2,248* 903 9,350 7,434 1,415 501 11,086 7,851 2,327 908 11,308 8,627 1,738 943 24 Canada 11. Beginning December 1992, excludes Bosnia, Croatia, and Slovenia. 12. Includes the Bank for International Settlements and Eastern European countries not listed in line 23. Beginning December 1992, includes, in addition, all former parts of the U.S.S.R. (except Russia), and Bosnia, Hercegovina, Croatia, and Slovenia. 13. Comprises Bulgaria, Czechoslovakia, Hungary, Poland, and Romania. 14. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial States). 15. Comprises Algeria, Gabon, Libya, and Nigeria. 16. Principally the International Bank for Reconstruction and Development. Excludes "holdings of dollars" of the International Monetary Fund. 17. Principally the Inter-American Development Bank. 18. Asian, African, Middle Eastern, and European regional organizations, except the Bank for International Settlements, which is included in "Other Western Europe." A59 A60 3.18 International Statistics • June 1993 BANKS' OWN CLAIMS ON FOREIGNERS Reported by Banks in the United States 1 Payable in U.S. Dollars Millions of dollars, end of period 1992 Area and country 1990 1991 1993 1992r Aug. Sept." Oct." Nov." Dec." Jan." Feb." 1 Total, all foreigners 511,543 514,339 495,675 480,163 r 486,071 493,689 490,721 495,675 483,873 492,977 2 Foreign countries 506,750 508,056 490,593 475,774' 481,900 491,217 487,840 490,593 480,773 488,869 113,093 362 5,473 497 1,047 14,468 3,343 727 6,052 1,761 782 292 2,668 2,094 4,202 1,405 65,151 1,142 597 530 499 114,310 327 6,158 686 1,907 15,112 3,371 553 8,242 2,546 669 344 1,881 2,335 4,540 1,063 60,395 825 789 1,970 597 124,085 341 6,404 707 1,419 14,847 4,229 718 9,048 2,497 356 325 2,772 4,929 4,722 962 63,934 569 1,706 3,148 452 119,248' 631' 6,353' 906' 1,081 13,091' 4,728' 601' 9,874' 2,075 707 387 2,590 6,567 3,924' 1,002 58,878' 678 1,351' 3,280 544 117,349 367 7,533 1,012 1,299 15,084 4,075 589 9,485 1,980 639 383 3,304 5,494 3,102 986 56,483 674 1,211 3,199 450 126,170 414 6,980 830 817 16,111 5,629 583 9,752 2,334 666 327 4,642 6,678 3,688 1,177 60,209 668 959 3,190 516 122,143 463 6,423 1,056 1,230 15,718 5,328 598 9,443 3,006 435 330 3,481 5,786 3,591 950 58,991 661 1,019 3,174 460 124,085 341 6,404 707 1,419 14,847 4,229 718 9,048 2,497 356 325 2,772 4,929 4,722 962 63,934 569 1,706 3,148 452 117,252 366 6,473 705 1,275 14,012 5,545 669 8,716 2,927 649 390 2,596 5,340 4,493 1,071 56,202 571 1,607 3,154 491 124,744 535 5,919 785 1,226 14,760 5,370 668 8,466 3,254 750 494 4,158 5,155 4,971 1,041 61,313 567 1,597 3,162 553 3 Europe 4 Austria Belgium and Luxembourg 5 6 Denmark 7 Finland 8 France 9 Germany 10 Greece 11 Italy 17 Netherlands 13 Norway 14 Portugal 15 Spain Sweden 16 17 Switzerland 18 Turkey 19 United Kingdom 20 Yugoslavia 2 7.1 Others in Western Europe 3 7? Russia 23 Other Eastern Europe 4 16,091 15,113 14,185 15,156' 15,862 16,830 15,834 14,185 16,482 14,972 7.5 Latin America and Caribbean 76 Argentina 77 Bahamas 7.8 Bermuda 79 Brazil 30 British West Indies 31 Chile 37, Colombia 33 Cuba 34 Ecuador 35 Guatemala 36 Jamaica 37 Mexico 38 Netherlands Antilles 39 Panama 40 Peru 41 Uruguay 47 Venezuela Other 43 231,506 6,967 76,525 4,056 17,995 88,565 3,271 2,587 0 1,387 191 238 14,851 7,998 1,471 663 786 2,571 1,384 246,137 5,869 87,138 2,270 11,894 107,846 2,805 2,425 0 1,053 228 158 16,567 1,207 1,560 739 599 2,516 1,263 213,780 4,882 59,532 5,934 10,737 98,738 3,397 2,750 0 884 262 167 15,049 1,379 4,474 730 936 2,525 1,404 217,721' 4,784' 62,673 r 6,302 12,286 99,960' 3,203' 2,322 0 949 186' 150 16,523' 966 2,025' 700" 799 2,583' 1,310 210,580 4,553 58,588 3,567 11,308 99,580 3,300 2,475 0 924 235 160 17,234 1,045 1,937 724 921 2,653 1,376 213,423 4,564 64,853 2,798 11,558 96,906 3,323 2,595 5 936 275 147 16,621 1,080 1,979 713 882 2,700 1,488 217,040 4,605 65,139 6,035 11,583 96,325 3,309 2,698 0 926 255 162 16,495 1,529 2,080 723 877 2,880 1,419 213,780 4,882 59,532 5,934 10,737 98,738 3,397 2,750 0 884 262 167 15,049 1,379 4,474 730 936 2,525 1,404 218,416 4,805 62,831 6,797 10,926 100,926 3,690 2,753 0 853 240 170 15,225 1,736 2,027 735 895 2,414 1,393 210,752 4,859 63,863 2,851 10,506 94,906 3,795 2,819 0 835 257 164 15,988 1,938 2,304 708 844 2,485 1,630 44 138,722 125,262 131,248 116,701" 131,011 127,358 126,143 131,248 121,729 130,913 620 1,952 10,648 655 933 774 90,699 5,766 1,247 1,573 10,749 13,106 747 2,087 9,617 441 952 860 84,807 6,048 1,910 1,713 8,284 7,796 906 2,046 9,673 529 1,189 820 78,609 6,170 2,145 1,867 18,559 8,735 696 1,983 7,986" 528 1,108 920 71,689" 6,201 1,776" 1,691 14,783 7,340 636 2,054 10,057 499 1,089 800 83,527 6,247 2,144 1,795 14,613 7,550 978 1,848 9,095 500 1,112 826 80,253 6,113 2,181 1,764 15,488 7,200 624 1,653 9,287 539 1,135 937 77,676 6,288 2,034 1,873 16,858 7,239 906 2,046 9,673 529 1,189 820 78,609 6,170 2,145 1,867 18,559 8,735 774 1,683 9,145 532 1,323 877 74,593 6,062 1,871 1,7% 17,083 5,990 892 1,585 10,283 550 1,291 809 79,650 6,753 1,842 1,737 17,775 7,746 57 Africa 58 Egypt 59 Morocco 60 South Africa 61 Zaire 62 Oil-exporting countries 6 63 Other 5,445 380 513 1,525 16 1,486 1,525 4,928 294 575 1,235 4 1,298 1,522 4,289 194 441 1,041 4 1,004 1,605 4,455 243 483 1,066 4 1,130 1,529 4,333 256 467 1,055 4 1,067 1,484 4,303 229 452 1,036 4 1,056 1,526 4,233 214 443 1,063 4 1,029 1,480 4,289 194 441 1,041 4 1,004 1,605 4,262 171 421 1,069 3 1,067 1,531 4,143 291 403 1,030 3 1,104 1,312 64 Other 65 Australia 66 Other 1,892 1,413 479 2,306 1,665 641 3,006 2,263 743 2,493 1,463 1,030 2,765 1,765 1,000 3,133 1,951 1,182 2,447 1,601 846 3,006 2,263 743 2,632 1,8% 736 3,345 2,552 793 67 Nonmonetary international and regional organizations 7 4,793 6,283 5,082 4,389 4,171 2,472 2,881 5,082 3,100 4,108 24 Canada 45 46 47 48 49 50 51 57 53 54 55 56 China People's Republic of China Republic of China (Taiwan) Hong Kong India Indonesia Israel Japan Korea (South) Philippines Thailand Middle Eastern oil-exporting countries Other 1. Reporting banks include all types of depository institutions, as well as some brokers and dealers. 2. Beginning December 1992, excludes Bosnia, Croatia, and Slovenia. 3. Includes the Bank for International Settlements and Eastern European countries not listed in line 23. Beginning December 1992, includes, in addition, all former parts of the U . S . S . R . (except Russia), and Bosnia, Hercegovina, Croatia, and Slovenia. 4. Comprises Bulgaria, Czechoslovakia, Hungary, Poland, and Romania. 5. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial States). 6. Comprises Algeria, Gabon, Libya, and Nigeria. 7. Excludes the Bank for International Settlements, which is included in "Other Western Europe." Nonbank-Reported 3.19 Data BANKS' OWN A N D DOMESTIC CUSTOMERS' CLAIMS ON FOREIGNERS Reported by Banks in the United States 1 Payable in U.S. Dollars Millions of dollars, end of period 1992r Claim 1990 1993 1992r 1991 Aug. Sept. 480,163 32,370 288,020 106,377 56,290 50,087 53,396 486,071 31,504 298.287 105,768 54,315 51,453 50,512 Oct. Nov. 493,689 32,056 298,056 112,224 60,856 51,368 51,353 490,721 30,955 290,974 112,512 61,999 50,513 56,280 Dec. 1 Total 579,044 579,683 555,659 2 Banks' claims 3 Foreign public borrowers 4 Own foreign offices 5 Unaffiliated foreign banks 6 Deposits 7 Other 8 All other foreigners 511,543 41,900 304,315 117,272 65,253 52,019 48,056 514,339 37,126 318,800 116,602 69,018 47,584 41,811 495,675 31,353 299,677 109,976 61,172 48,804 54,669 67,501 14,375 65,344 15,280 59,984 15,452 62,215 15,348 59,984 15,452 41,333 37,125 31,400 33,687 31,400 11,792 12,939 13,132 13,180 13,132 13 Customer liability on acceptances 13,628 8,974 8,682 8,540 8,682 14 Dollar deposits in banks abroad, reported by nonbanking business enterprises in the United States . . . . 44,638 40,146 r 33,562 9 Claims of banks' domestic c u s t o m e r s 3 . . . 10 Deposits 11 Negotiable and readily transferable instruments 4 12 Outstanding collections and other claims Jan/ Feb.P 483,873 33,148 290,862 101,989 53,629 48,360 57,874 492,977 30,454 303,726 102,434 51,020 51,414 56,363 36,087 n.a. 555,659 548.286 495,675 31,353 299,677 109,976 61,172 48,804 54,669 MEMO 33,932 34,522 33,708 33,562 foreign bank, and foreign branches, agencies, or wholly owned subsidiaries of head office or parent foreign bank. 3. Assets held by reporting banks for the account of their domestic customers. 4. Principally negotiable time certificates of deposit and bankers acceptances. 5. Includes demand and time deposits and negotiable and nonnegotiable certificates of deposit denominated in U . S . dollars issued by banks abroad. For description of changes in data reported by nonbanks, see Federal Reserve Bulletin, vol. 65 (July 1979), p. 550. 1. For banks' claims, data are monthly; for claims of banks' domestic customers, data are quarterly. Reporting banks include all types of depository institution, as well as some brokers and dealers. 2. For U.S. banks, includes amounts due from own foreign branches and foreign subsidiaries consolidated in Consolidated Report of Condition filed with bank regulatory agencies. For agencies, branches, and majority-owned subsidiaries of foreign banks, consists principally of amounts due from head office or parent 3.20 34,692 BANKS' OWN CLAIMS ON UNAFFILIATED FOREIGNERS Reported by Banks in the United States 1 Payable in U.S. Dollars Millions of dollars, end of period 1992 Maturity, by borrower and area 1 Total 2 3 4 5 6 7 8 9 10 11 V 13 14 15 16 17 18 19 By borrower Maturity of one year or less Foreign public borrowers All other foreigners Maturity of more than one y e a r Foreign public borrowers All other foreigners By area Maturity of one year or less Europe Canada Latin America and Caribbean Asia Africa All other 3 Maturity of more than one y e a r Europe Canada Latin America and Caribbean Asia Africa All other 3 1989 1991 Mar/ June r Sept/ Dec.p 238,123 206,903 195,302 194,450 196,768 187,398 195,682 178,346 23,916 154,430 59,776 36,014 23,762 165,985 19,305 146,680 40,918 22,269 18,649 162,573 21,050 141,523 32,729 15,859 16,870 161.566 20,253 141,313 32,884 16,182 16,702 162,433 20,528 141,905 34,335 15,145 19,190 155,254 17,863 137,391 32,144 13,295 18,849 164,131 17,867 146,264 31,551 13,206 18,345 53,913 5,910 53,003 57,755 3,225 4,541 49,184 5,450 49,782 53,258 3,040 5,272 51,835 6,444 43,597 51,059 2,549 7,089 52,911 6,958 48,536 43,645 2,470 7,046 54,997 7,986 49,094 41,409 2,127 6,820 55,986 5,949 45,241 40,824 2,183 5,071 53,952 6,118 50,325 45,862 1,810 6,064 4,121 2,353 45,816 4,172 2,630 684 3,859 3,290 25,774 5,165 2,374 456 3,878 3,595 18,277 4,459 2,335 185 4,315 3,289 18,120 4,714 2,207 239 6,752 3,158 16,827 4,979 2,356 263 6,625 3,227 15,092 4,815 2,107 278 5,360 3,290 15,149 4,977 2,364 411 1. Reporting banks include all kinds of depository institutions besides commerrial banks, as well as some brokers and dealers. 1990 2. Maturity is time remaining to maturity, 3. Includes nonmonetary international and regional organizations. A61 A62 3.21 International Statistics • June 1993 CLAIMS ON FOREIGN COUNTRIES Held by U.S. Offices and Foreign Branches of U.S.-Chartered Banks 1 Billions of dollars, end of period 1990 Area or country 1 Total 2 G-10 countries and Switzerland 3 Belgium and Luxembourg 4 France 5 Germany 6 Italy 7 Netherlands 8 Sweden 9 Switzerland 10 United Kingdom 11 Canada 12 Japan lyoo 346.3 r 152.7 9.0 10.5 10.3 6.8 2.7 1.8 5.4 66.2 5.0 34.9 1991 1992 i9oy 338.8 152.9 6.3 11.7 10.5 7.4 3.1 2.0 7.1 67.2 5.4 32.2 Dec. Mar. June Sept. Dec. Mar. 317.8 325.3 320.4 335.7 341.5 347.8 r 137.2 6.0 11.0 8.3 5.6 4.7 1.9 3.4 68.5 5.8 22.2 r 132.1 5.9 10.4 10.6 5.0 3.0 2.2 4.4 60.8 5.9 23.9 129.9 6.2 9.7 8.8 4.0 3.3 2.0 3.7 62.3 6.8 23.2 129.8 6.1 10.5 8.3 3.6 3.3 2.5 3.3 59.5 8.2 24.6 134.0 5.8 11.1 9.7 4.5 3.0 2.1 3.9 64.9 5.8 23.2 Sept. Dec." 357.5 r 344.3 r 345.1 r 3.2 64.8 6.6 r 20.7 8.8 r 8.0 3.3 1.9 4.6 65.8 r 6.7 18.3 137.2 r 6.2 15.5 r 10.9 6.4 3.7 2.2 5.2 r 62.2 r 6.7 18.3 133.2 5.6 15.3 9.3 6.5 2.8 2.3 4.7 61.3 6.5 18.8 130.6 5.3 10.0 8.4 5.4 4.3 June 135.7 6.2 12.0F 13 Other industrialized countries 14 Austria 15 Denmark 16 Finland 17 Greece 18 Norway 19 Portugal 20 Spain 21 Turkey 22 Other Western Europe 23 South Africa 24 Australia 21.3 r 1.5 1.1 1.1 1.8 1.8 .4 6.2 1.5 1.7r 2.4 1.8 21. <f 1.5 1.1 1.0 2.5 1.4 .4 7.1 1.2 1.0r 2.0 1.6 22.9 r 1.4 1.1 .7 2.7 1.6 .6 8.3 1.7 1.2r 1.8 1.8 23.5 r 1.4 .9 1.0 2.5 1.5 .6 9.0 1.7 1.2r 1.8 1.9 21.3 r 1.1 1.2 .8 2.4 1.5 .6 7.1 1.9 i.r 1.8 2.0 22. l r 1.0 .9 .6 2.3 1.4 .5 8.3 1.6 1.3r 1.6 2.4 22.8 r .6 .9 .7 2.6 1.4 .6 8.3 1.4 1.8r 1.9 2.7 21.5 r .8 .8 .8 2.3 1.5 .5 7.7 1.2 1.5r 1.8 2.3 25.5 .8 1.3 .8 2.8 1.7 .5 10.1 1.5 2.0 r 1.7 2.3 25. r .8r 1.5 1.0 2.9 r 1.6 .5 9.8 1.5 1.5 r 1.7 2.3 24.1 1.2 .9 .7 3.0 1.2 .4 9.0 1.3 1.7 1.7 2.9 25 OPEC 2 26 Ecuador 27 Venezuela 28 Indonesia 29 Middle East countries 30 African countries 16.6 1.7 7.9 1.7 3.4 1.9 17.1 1.3 7.0 2.0 5.0 1.7 12.8 1.0 5.0 2.7 2.5 1.7 17.1 .9 5.1 2.8 6.6 1.6 14.0 .9 5.3 2.6 3.7 1.5 15.6 .8 5.6 2.8 5.0 1.5 14.6 .7 5.4 2.8 4.2 1.5 15.8 .7 5.4 3.0 5.3 1.4 16.2 .7 5.3 3.0 5.9 1.4 15.9 .7 5.4 3.0 5.4 1.4 16.1 .6 5.2 3.0 6.2 1.1 31 Non-OPEC developing countries 85.3 77.5 65.4 66.4 65.0 65.0 64.3 70.6 68.6 r 73.4 r 72.6 9.0 22.4 5.6 2.1 18.8 .8 2.6 6.3 19.0 4.6 1.8 17.7 .6 2.8 5.0 14.4 3.5 1.8 13.0 .5 2.3 4.7 13.9 3.6 1.7 13.7 .5 2.2 4.6 11.6 3.6 1.6 14.3 .5 2.0 4.5 10.5 3.7 1.6 16.2 .4 1.9 4.8 9.6 3.6 1.7 15.5 .4 2.1 5.0 10.8 3.9 1.6 18.2 .4 2.2 5.1 10.6 4.0 1.6 16.3r .4 2.2 6.2 10.8 4.2 1.7 17.1 ,4r 2.5 6.6 10.8 4.4 1.8 16.0 .5 2.6 32 33 34 35 36 37 38 Latin America Argentina Brazil Chile Colombia Mexico Peru Other 39 40 41 42 43 44 45 46 47 Asia China Peoples Republic of China Republic of China (Taiwan) India Israel Korea (South) Malaysia Philippines Thailand Other Asia 3 .3 3.7 2.1 1.2 6.1 1.6 4.5 1.1 .9 .3 4.5 3.1 .7 5.9 1.7 4.1 1.3 1.0 .2 3.5 3.3 .5 6.2 1.9 3.8 1.5 1.7 .4 3.6 3.5 .5 6.8 2.0 3.7 1.6 2.1 .6 4.1 3.0 .5 6.9 2.1 3.7 1.7 2.3 .4 4.1 2.8 .5 6.5 2.3 3.6 1.9 2.3 .3 4.1 3.0 .5 6.8 2.3 3.7 1.7 2.4 .3 4.8 3.6 .4 6.9 2.5 3.6 1.7 2.7 .3 4.6 3.8 .4 6.9 2.7 3.r 1.9 s.o 1 .3 5.0 3.6 .4 7.4 3.0 3.6 r 2.2 3.3 .7 5.2 3.2 .4 6.6 3.0 3.6 2.2 3.1 48 49 50 51 Africa Egypt Morocco Zaire , Other Africa 3 .4 .9 .0 1.1 .4 .9 .0 1.0 .4 .8 .0 1.0 .4 .8 .0 .8 .4 .7 .0 .8 .4 .7 .0 .8 .4 .7 .0 .7 .3 .7 .0 .7 .5 .7 .0 .6 .3 .6 .0 .9 .2 .6 .0 1.0 52 Eastern Europe 53 Russia 54 Yugoslavia 55 Other 3.6 .7 1.8 1.1 3.5 .7 1.6 1.3 2.3 .2 1.2 .9 2.1 .3 1.0 .8 2.1 .4 1.0 .7 1.8 .4 .8 .7 2.4 .9 .9 .7 2.9 1.4 .8 .6 3.0 1.7 .7 .6 3.1 1.8 .7 .7 3.1 1.9 .6 .6 56 Offshore banking centers 57 Bahamas 58 Bermuda 59 Cayman Islands and other British West Indies 60 Netherlands Antilles 61 Panama 62 Lebanon 63 Hong Kong 64 Singapore 65 Other 44.2 11.0 .9 12.9 1.0 2.5j 36.6 5.5 1.7 9.0 2.3 1.4j 42.5 2.8 4.4 11.5 7.9 1.4j 50.0 8.3 4.4 14.1 1.1 1.5 J 48.3 6.8 4.2 14.9 1.4 1.3| 52.7 6.7 7.1 13.8 3.9 1.3 52.0 11.9 2.3 15.8 1.2 1.3 58.5 14. r 3.9 17.4 1.0 1.3 59.4 r 12.3 r 5.1 18. l r .8 52.3 r 8.2 r 3.8 15.7 r i.r 1.8r 55.1 5.7 6.2 19.9 1.1 1.7 6.6 .0 1L6 8.9 .0 12.4 7.2 .0 12! 1 7.7 .0 12^2 7.1 .0 12.'r 8.5 .0 14.V 6.4 .0 15^2 6.8 r .0 13^8 6.5 .0 66 Miscellaneous and unallocated 6 22.6 39.8 36.4 39.9 44.6 48.2 48.0 48.8 r 36.9 1 40.7 9.7 9^6 6.1 .0 7.0 .0 30.3 1. The banking offices covered by these data are the U.S. offices and foreign branches of U.S.-owned banks and of U.S. subsidiaries of foreign-owned banks. Offices not covered include (1) U.S. agencies and branches of foreign banks, and (2) foreign subsidiaries of U . S . banks. To minimize duplication, the data are adjusted to exclude the claims on foreign branches held by a U.S. office or another foreign branch of the same banking institution. The data in this table combine foreign branch claims in table 3.14 (the sum of lines 7 through 10) with the claims of U.S. offices in table 3.18 (excluding those held by agencies and branches of foreign banks and those constituting claims on own foreign branches). Since June 1984, reported claims held by foreign branches have been reduced by an increase in the reporting threshold for "shell" branches from $50 million to in .r $150 million equivalent in total assets, the threshold now applicable to all reporting branches. 2. Organization of Petroleum Exporting Countries, shown individually; other members of OPEC (Algeria, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, and United Arab Emirates); and Bahrain and Oman (not formally members of OPEC). 3. Excludes Liberia. 4. Includes Canal Zone beginning December 1979. 5. Foreign branch claims only. 6. Includes N e w Zealand, Liberia, and international and regional organizations. Nonbank-Reported 3.22 Data A63 LIABILITIES TO UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the United States' Millions of dollars, end of period 1992 1991 Type and area or country 1989 1990r 1991 Sept. 1 Total 38,764 46,043 Dec. Mar. June Sept. Dec.p 43,156 43,218 r 43,156 r 44,098* 44,176* 45,166* 42,422 r 37,764* 5,392 38,640* 5,458* 37,481* 6,695 36,574* 8,592* 35,422 7,000 2 Payable in dollars 3 Payable in foreign currencies 33,973 4,791 40,786 5,257 37,764 5,392 38,482 4,736 By type 4 Financial liabilities 5 Payable in dollars 6 Payable in foreign currencies 17,879 14,035 3,844 21,066 16,979 4,087 21,893 17,781 4,112 21,652 r 17,947r 3,705 21,893* 17,781* 4,112 22,255* 18,027* 4,228 21,988* 16,744* 5,244 23,406* 16,468* 6,938* 21,547 15,676 5,871 20,885 8,070 12,815 19,938 947 24,977 10,683 14,294 23,807 1,170 21,263 8,310 12,953 19,983 1,280 21,566 8,313 13,253 20,535 1,031 21,263 8,310 12,953 19,983 1,280 21,843* 8,926* 12,917 20,613* 1,230* 22,188 9,516 12,672 20,737 1,451 21,760 9,409* 12,351* 20,106 1,654 20,875 8,838 12,037 19,746 1,129 11,660 340 258 464 941 541 8,818 10,978 394 975 621 1,081 545 6,357 11,905 217 2,106 682 1,056 408 6,429 12,311r 397 2,164 682 1,050 497 6,589* 11,905* 217 2,106 682 1,056 408 6,429* 12,449* 174 1,997 666 1,025 355 7,338* 13,030* 194 2,324 836 979 490 7,344* 14,070* 256 2,785* 941* 980* 627* 7,680* 12,152 407 1,608 740 606 585 7,516 7 Commercial liabilities 8 Trade payables 9 Advance receipts and other liabilities . . . 10 Payable in dollars 11 Payable in foreign currencies 12 13 14 15 16 17 18 By area or country Financial liabilities Europe Belgium and Luxembourg France Germany Netherlands Switzerland United Kingdom 19 Canada 610 229 267 305 267 283 337 320 20 21 22 23 24 25 26 Latin America and Caribbean Bahamas Bermuda Brazil British West Indies Mexico Venezuela 1,357 157 17 0 724 6 0 4,153 371 0 0 3,160 5 4 4,325 537 114 6 3,065 7 4 3,883 314 0 6 2,961 6 4 4,325* 537 114 6 3,065* 7 4 4,062* 396 114 8 2,930* 7 4 3,323* 343 114 10 2,182* 8 4 3,345* 220* 115 18 2,291* 12 5 3,480 249 214 19 2,307 11 6 27 28 29 Asia Japan Middle East oil-exporting countries 2 . . 4,151 3,299 2 5,295 4,065 5 5,338 4,102 13 5,149 r 4,000* 19 5,338* 4,102* 13 5,366* 4,107* 13 5,209* 4,116* 10 5,581* 4,548* 17 5,384 4,353 19 30 Africa 2 0 2 0 6 4 3 2 6 4 7 6 0 0 5 0 6 0 100 409 52 1 52 88 89 85 27 9,071 175 877 1,392 710 693 2,620 10,310 275 1,218 1,270 844 775 2,792 7,808 248 830 944 709 488 2,310 8,084 225 992 911 751 492 2,217 7,808 248 830 944 709 488 2,310 7,501* 256 678* 880* 574 482 2,445* 7,144 240 659 702 605 400 2,404 6,714* 173 688* 744 601 369 2,262* 1,124 1,261 990 1,011 990 l,095 r 31 32 33 34 35 36 37 38 39 40 Oil-exporting countries All other 4 Commercial liabilities Europe Belgium and Luxembourg France Germany Netherlands Switzerland United Kingdom Canada 498 6,624 285 660 592 555 398 2,225 1,077 1,085 987 41 42 43 44 45 46 47 Latin America and Caribbean Bahamas Bermuda Brazil British West Indies Mexico Venezuela 1,224 41 308 100 27 323 164 1,672 12 538 145 30 475 130 1,352 3 310 219 107 304 94 1,512 14 450 211 46 291 102 1,352 3 310 219 107 304 94 1,701 13 493 230 108 375 168 1,803 8 409 212 73 475 279 1,518 3 338 115 85 322 147 1,520 6 292 197 55 444 127 48 49 50 Asia Japan Middle Eastern oil-exporting countries' 7,550 2,914 1,632 9,483 3,651 2,016 9,330 3,720 1,498 8,855 3,363 1,780 9,330 3,720 1,498 9,890* 3,549* 1,591 10,439 3,537 1,778 11,006* 3,909* 1,813 10,643 3,990 1,946 51 52 Africa Oil-exporting countries 3 886 339 844 422 713 327 836 357 713 327 644 253 775 389 675 337 535 291 53 Other 4 1,030 1,406 1,070 1,268 1,070 1,012 950 762 566 1. For a description of the changes in the international statistics tables, see Federal Reserve Bulletin, vol. 65, (July 1979), p. 550. 2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial States). 3. Comprises Algeria, Gabon, Libya, and Nigeria. 4. Includes nonmonetary international and regional organizations. 5. Revisions include a reclassification of transactions, which also affects the totals for Asia and the grand totals. A64 International Statistics • June 1993 3.23 CLAIMS ON UNAFFILIATED FOREIGNERS the United States 1 Reported by Nonbanking Business Enterprises in Millions of dollars, end of period 1991 Type, and area or country 1989 1990 1992 1991 Sept. Dec. Mar. June Sept. Dec.p 1 Total 33,173 35,348 42,667 38,315 42,667 r 42,199" 41,869" 38,659" 37,728 2 Payable in dollars 3 Payable in foreign currencies 30,773 2,400 32,760 2,589 40,098 2,569 35,952 2,363 40,098 r 2,569" 39,558" 2,641" 38,899" 2,970" 35,738" 2,921 35,164 2,564 By type 4 Financial claims 5 Deposits Payable in dollars 6 7 Payable in foreign currencies 8 Other financial claims Payable in dollars 9 Payable in foreign currencies 10 19,297 12,353 11,364 989 6,944 6,190 754 19,874 13,577 12,552 1,025 6,297 5,280 1,017 25,463 17,218 16,343 875 8,245 7,365 880 22,536 16,188 15,182 1,006 6,348 5,611 737 25,463 17,218 16,343 875 8,245 7,365 880 25,328" 16,964 15,803 1,161 8,364" 7,617" 747 24,612" 15,116 13,829 1,287 9,496" 8,771" 725 21,367 12,547 11,489 1,058 8,820 7,788 1,032 20,482 12,534 11,788 746 7,948 7,184 764 11 Commercial claims 12 Trade receivables Advance payments and other claims 13 14 Payable in dollars Payable in foreign currencies 15 13,876 12,253 1,624 13,219 657 15,475 13,657 1,817 14,927 548 17,204 14,479 2,725 16,390 814 15,779 13,429 2,350 15,159 620 17,204r 14,479" 2,725 16,390" 814" 16,871" 14,266" 2,605 16,138" 733" 17,257" 14,756" 2,501 16,299" 958" 17,292" 14,552" 2,740 16,461" 831 17,246 14,888 2,358 16,192 1,054 8,463 28 153 152 238 153 7,496 9,645 76 371 367 265 357 7,971 13,546 13 312 342 385 591 11,251 13,129 76 255 434 420 580 10,997 13,546 13 312 342 385 591 11,251 14,205" 12 277 290 727 682 11,631 13,200" 25 786 381 732 779 8,768" 11,249 16 809 321 766 602 7,727 9,147 8 771 401 536 506 5,749 16 17 18 19 20 21 22 By area or country Financial claims Europe Belgium and Luxembourg France Germany Netherlands Switzerland United Kingdom 23 Canada 1,904 2,934 2,679 2,163 2,679 2,750" 2,529" 2,256 1,695 24 25 26 27 28 29 30 Latin America and Caribbean Bahamas Bermuda Brazil British West Indies Mexico Venezuela 8,020 1,890 7 224 5,486 94 20 6,201 1,090 3 68 4,635 177 25 7,932 758 8 192 6,384 321 40 6,289 652 19 137 5,106 176 32 7,932 758 8 192 6,384 321 40 7,070 415 12 191 5,912 318 34 7,260 523 12 181 6,018 343 32 6,523 1,099 65 135 4,792 222 26 8,278 625 40 234 6,749 270 29 31 32 33 Asia Japan Middle East oil-exporting countries 590 213 8 860 523 8 957 385 5 614 277 3 957 385 5 995 481 4 836 684 3 34 35 Africa Oil-exporting countries 140 12 37 0 57 1 61 1 57 1 66 1 74 9 All other 4 180 195 292 280 292 278 452 7,950 192 1,544 943 643 295 2,088 6,884 190 1,330 858 641 258 1,807 7,950 192 1,544 943 643 295 2,088 36 37 38 39 40 41 42 43 Commercial claims Europe Belgium and Luxembourg France Germany Netherlands Switzerland United Kingdom 6,209 242 964 696 479 313 1,575 7,044 212 1,240 807. 555 301 1,775 961" 380 3 1,275" 712 4 60 0 57 0 282" 291" 7,894 181 1,562 936 646 328 2,086 8,138" 255 1,563 908 666 399 2,173 7,792" 170 1,741" 885 588 294 1,977 7,526 183 1,394 883 541 294 1,776 Canada 1,091 1,074 1,174 1,232 1,174 1,176 1,131 1,172 1,243 45 46 47 48 49 50 51 Latin America and Caribbean Bahamas Bermuda Brazil British West Indies Mexico Venezuela 2,184 58 323 297 36 508 147 2,375 14 246 326 40 661 192 2,591 11 263 418 41 829 202 2,494 8 255 385 37 741 1% 2,591 11 263 418 41 829 202 2,572 11 272 364 45 892 206 2,672 9 291 438 32 847 251 3,141 7 245 395 43 968 302 2,844 18 237 336 25 822 316 52 53 54 Asia Japan Middle Eastern oil-exporting countries 3,570 1,199 518 4,127 1,460 460 4,573 1,878 621 4,282 1,808 4% 4,573" 1,878" 621 4,354" 1,782" 635 4,463" 1,786 609 4,308" 1,793" 512 4,648 1,848 653 55 56 Africa Oil-exporting countries 3 429 108 488 67 418 95 431 80 418 95 418 75 422 73 430 66 536 77 57 Other 4 393 367 498 456 498" 457" 431" 449 449 44 1. For a description of the changes in the international statistics tables, see Federal Reserve Bulletin, vol. 65, (July 1979), p. 550. 2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial States). 3. Comprises Algeria, Gabon, Libya, and Nigeria. 4. Includes nonmonetary international and regional organizations. Securities Holdings and Transactions 3.24 A65 FOREIGN TRANSACTIONS IN SECURITIES Millions of dollars Transaction and area or country 1991 1992 1993 1992 1993 r Jan.Feb. Aug. Sept. Oct/ Nov/ Dec/ Jan/ Feb." 22,725 20,382 19,170 19,353 29,038 25,980 3,058 U.S. corporate securities STOCKS 211,207 200,116 1 Foreign purchases 2 Foreign sales 221,350 226,490 48,208 45,333 13,174 14,841 13,884 17,034 18,820 18,170 17,885 16,598 3 Net purchases or sales ( - ) 11,091 -5,140 2,875 -1,667 -3,150 650 1,287 2,343 -183 4 Foreign countries 10,522 -5,173 2,790 -1,622 -3,059 653 1,284 2,319 -178 2,968 53 9 -63 -227 -131 -352 3,845 2,177 -134 4,255 1,179 153 174 -4,934 -1,331 -64 -280 143 -3,294 1,405 2,209 -88 -3,944 -3,598 10 169 2,342 198 188 53 706 804 -284 336 -157 470 -5% 31 52 -1,089 -46 -26 -54 -150 -652 -59 -24 -14 -442 -301 -1 7 -1,683 -234 -112 -107 -189 -869 -278 -90 136 -1,064 -97 14 -94 75 -92 -52 -24 -124 362 -227 235 -57 767 184 -21 -119 371 -50 47 -4 -40 361 43 649 -219 373 220 -18 85 1,505 -154 162 190 221 705 176 422 70 122 215 -7 31 52 -25 91 64 205 -350 -341 305 -92 -123 28 4 17 2,290 223 97 -11 501 1,154 57 31 -65 593 -624 27 35 568 33 85 -45 -91 -3 3 24 -5 90 153,096 125,637 214,801 175,310 39,381 34,146 19,785 16,620 17,160 14,452 19,315 15,224 18,082 16,317 19,264 15,513 17,417 15,439 21,964 18,707 5 6 7 8 9 10 11 12 13 14 15 16 17 Europe France Germany Netherlands Switzerland United Kingdom Canada Latin America and Caribbean Middle East 1 Other Asia Japan Africa Other countries 18 Nonmonetary international and regional organizations BONDS2 19 Foreign purchases 20 Foreign sales 21 Net purchases or sales ( - ) 27,459 39,491 5,235 3,165 2,708 4,091 1,765 3,751 1,978 3,257 22 Foreign countries 27,590 38,375 5,457 3,150 2,573 4,045 1,600 3,206 2,074 3,383 23 24 25 26 27 28 29 30 31 32 33 34 35 13,112 847 1,577 482 656 8,931 1,623 2,672 1,787 8,459 5,767 52 -116 18,314 1,221 2,503 531 -513 13,229 236 8,833 3,166 7,545 -450 354 -73 3,664 412 143 -252 69 3,067 -292 901 548 454 251 195 -13 1,516 -5 -13 22 -94 1,447 -100 878 284 593 -1,229 1 -22 1,818 155 387 58 -51 1,319 48 548 -5 171 -590 -7 0 1,993 -4 -34 133 -23 1,568 198 842 273 790 467 -50 -1 -492 -7 -113 144 -260 -312 281 540 515 692 266 -4 68 1,996 217 857 48 105 962 -38 513 360 119 9 302 -46 1,302 101 91 -119 122 349 -437 419 300 305 190 168 17 2,362 311 52 -133 -53 2,718 145 482 248 149 61 27 -30 -131 1,116 -222 15 135 46 165 545 -96 -126 -4,260 12,477 16,737 -2,205 49,670 51,875 -3,636 11,672 15,308 -791 52,066 52,857 -4,368 12,781 17,149 -2,874 39,607 42,481 -2,328 12,722 15,050 -5,099 38,411 43,510 -1,545 15,042 16,587 -9,789 55,480 65,269 Europe France Germany Netherlands Switzerland United Kingdom Canada Latin America and Caribbean Middle East 1 Other Asia Japan Africa Other countries 36 Nonmonetary international and regional organizations Foreign securities -2,950* 9,779* 12,729* 276* 45,943* 45,667* -2,892* 13,632* 16,524* -1,420* 46,140* 47,560* -18,761 -2,674* -4,312* -6,465 -4,427 -7,242 -7,427 -11,334 -17,892 -2,761* -4,333* -6,492 -4,500 -7,196 -6,420 -11,472 -38,109 -6,653 -1,830 -6,583 -57 -760 -13,413 -5,146 190 186 -4 295 -1,234* 207 -430 -1,376 11 61 -3,196* -222* 308 -1,667 -14 458* -6,851 -1,008 1,091 681 -2 -403 -5,001 571 -1,671 1,567 42 -8 -4,516 -1,167 512 -1,670 -11 -344 -6,468 -161 195 -381 -7 402 -6,945 -4,985 -5 567 3 -107 3,336 -869 27 73 -46 -1,007 138 37 Stocks, net purchases or sales ( - ) ' 38 Foreign purchases 39 Foreign sales 3 40 Bonds, net purchases or sales ( - ) 41 Foreign purchases 42 Foreign sales —31,967 120,598 152,565 -14,828 330,311 345,139 -32,186 149,987 182,173 -18,470 485,659 504,129 -3,873 27,764 31,637 -14,888 93,891 108,779 43 Net purchases or sales (—), of stocks and bonds -46,795 -50,656 44 Foreign countries -46,711 -53,992 45 46 47 48 49 50 -34,452 -7,004 759 -7,350 -9 1,345 -84 Europe Canada Latin America and Caribbean Asia Africa Other countries 51 Nonmonetary international and regional organizations 1. Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial States). 2. Includes state and local government securities and securities of U.S. government agencies and corporations. Also includes issues of new debt securities sold abroad by U . S . corporations organized to finance direct investments abroad. 87 21 3. In a July 1989 merger, the former stockholders of a U . S . company received $5,453 million in shares of the new combined U . K . company. This transaction is not reflected in the data, A66 3.25 International Statistics • June 1993 MARKETABLE U.S. TREASURY BONDS A N D NOTES Foreign Transactions Millions of dollars 1993 Country or area 1991 1992 1993 1992 Jan.Feb. Aug. Sept. Oct. Nov. Dec.r Jan. r Feb." Transactions, net purchases or sales ( - ) during period 1 1 Estimated total 19,865 39,319" -820 6,458 -5,995 3,546" 17,648" 8 454 -1,274 2 Foreign countries 19,687 37,966R -2,296 6,785 -6,204 4,351" 17,661" -194 -129 -2,167 4,671" 232 - 8 -40 202 769 4,068" -551 -1 458 7,284" 370 -1,584 1,827 668 1,334 7,209" -2,758 218 -1,087 3,163 -28 898 -804 -344 213 2,833 395 0 -99 -585 -59 697 -1,238 -54 -199 2,025 -1,759 2 3,302 -383 45 -1,632 206 258 -455 182 975 38 82 3 4 5 6 7 8 9 10 11 12 Europe Belgium and Luxembourg Germany Netherlands Sweden Switzerland United Kingdom Other Western Europe Eastern Europe Canada 8,663 523 -4,725 -3,735 -663 1,007 6,218 10,024 13 -3,019 19,647R 1,985" 2,076 -2,923 -804 481 24,184" -6,002" 650" 562" -968 -14 -935 -1,032 204 -654 2,207 -784 40 3,384 3,450 80 255 367 -1,289 -87 3,681 428 15 900 -4,655 -25 900 -239 -843 292 16 -4,761 5 -4,281 13 14 15 16 17 18 19 20 Latin America and Caribbean Venezuela Other Latin America and Caribbean Netherlands Antilles Asia Japan Africa Other 10,285 10 4,179 6,097 3,367 -4,081 689 -298 -3,223 539 -1,957 -1,805 23,526" 9,817" 1,103 -3,649 -1,050 4 -4,965 3,911 -2,168 61 -172 -1,322 -1,563 60 -758 -865 4,112 1,887 56 -170 -1,479 31 -2,537 1,027 4,004 2,448 59 148 -1,915 155 -3,233 1,163 1,416 -339 -37 -242 7,270 27 2,385 4,858 4,000 3,383 119 75 -4,519 11 415 -4,945 1,188 2,201 0 73 -1,495 -175 -3,309 1,989 -1,136 -743 -33 -182 445 179 -1,656 1,922 -1,032 804 -139 -1,140 21 22 23 Nonmonetary international and regional organizations International Latin American regional 1,476 809 505 -327 -133 -75 209 -31 201 -805 -903 219 -13 -38 -31 202 76 97 583 228 270 893 581 235 -194 -719 525 -129 -2,965 2,836 -2,167 511 0 -238 8 -1,855 0 178 -358 -72 1,353 1,018 533 MEMO 24 25 26 Foreign countries Official institutions Other foreign Oil-exporting countries 2 2 7 Middle E a s t 3 2 8 Africa 19,687 1,190 18,496 37,966" 6,876" 31,090" -2,296 -7,329 5,033 6,785 697 6,088 -6,204 -4,483 -1,721 -6,822 239 4,323 11 -2,093 8 1,093 0 750 4 1. Official and private transactions in marketable U.S. Treasury securities having an original maturity of more than one year. Data are based on monthly transactions reports. Excludes nonmarketable U.S. Treasury bonds and notes held by official institutions of foreign countries. 4,351" 2,951 1,400" -271 0 17,661" -603 18,264" 407 0 -4,364 2,197 2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial States). 3. Comprises Algeria, Gabon, Libya, and Nigeria. Interest and Exchange Rates 3.26 A67 DISCOUNT RATES OF FOREIGN CENTRAL BANKS 1 Percent per year Rate on Apr. 30, 1993 Rate on Apr. 30, 1993 Country Percent Austria.. Belgium . Canada.. Denmark France 2 .. 6.75 7.0 5.60 10.5 8.25 Country Month effective Apr. Mar. Apr. Mar. Apr. 1993 1993 1993 1993 1993 Percent 7.25 11.0 2.5 6.75 Germany... Italy Japan Netherlands 1. Rates shown are mainly those at which the central bank either discounts or makes advances against eligible commercial paper or government securities for commercial banks or brokers. For countries with more than one rate applicable to such discounts or advances, the rate shown is the one at which it is understood that the central bank transacts the largest proportion of its credit operations. 3.27 Rate on Apr. 30, 1993 Country Month effective Apr. Apr. July Apr. 1993 1993 1992 1993 Percent 7.75 5.0 Norway Switzerland United Kingdom 12.0 Month effective Apr. 1993 Mar. 1993 Sept. 1992 2. Since Feb. 1981, the rate has been that at which the Bank of France discounts Treasury bills for seven to ten days. FOREIGN SHORT-TERM INTEREST RATES 1 Averages of daily figures, percent per year 1993 1992 Type or country 8 Italy 1990 8.16 14.73 13.00 8.41 8.71 8.57 10.20 12.11 9.70 7.75 1991 5.86 11.47 9.07 9.15 8.01 9.19 9.49 12.04 9.30 7.33 1992 3.70 9.56 6.76 9.42 7.67 9.25 10.14 13.91 9.31 4.39 1. Rates are for three-month interbank loans, with the following exceptions: Canada, finance company paper; Belgium, three-month Treasury bills; and Japan, CD rate. Oct. Nov. Dec. Jan. Feb. Mar. Apr. 3.30 8.23 7.57 8.85 6.28 8.63 10.82 15.52 8.70 3.85 3.67 7.16 7.63 8.84 6.44 8.66 9.58 14.38 8.64 3.77 3.50 7.11 7.93 8.93 6.13 8.55 10.75 13.60 8.65 3.76 3.22 6.88 7.03 8.50 5.52 8.00 11.69 12.56 8.19 3.70 3.12 6.10 6.38 8.29 5.34 7.98 11.70 11.43 8.75 3.27 3.11 5.91 5.59 7.85 5.05 7.47 10.89 11.26 8.27 3.26 3.10 5.90 5.43 7.81 4.97 7.43 8.73 11.41 7.94 3.22 A68 3.28 International Statistics • June 1993 FOREIGN EXCHANGE RATES 1 Currency units per dollar except as noted 1993 1992 Country/currency unit 1 7 3 4 5 6 7 8 9 10 Australia/dollar 2 Austria/schilling Belgium/franc Canada/dollar China, P.R./yuan Denmark/krone Finland/markka France/franc Germany/deutsche mark Greece/drachma 11 17 13 14 15 16 17 18 19 20 Hong Kong/dollar Ireland/pound 2 Italy/lira Japan/yen Malaysia/rinegit Netherlands/guilder N e w Zealand/dollar 2 Norway /krone Portugal/escudo 71 77 7.3 74 75 76 77 78 79 30 Singapore/dollar South Africa/rand South Korea/won Spain/peseta Sri Lanka/rupee Sweden/krona Switzerland/franc Taiwan/dollar Thailand/baht United Kingdom/pound 2 1990 1991 1992 Jan. Feb. Mar. Apr. 77.872 11.686 34.195 1.1460 5.3337 6.4038 4.0521 5.6468 1.6610 182.63 73.521 10.992 32.148 1.2085 5.5206 6.0372 4.4865 5.2935 1.5618 190.81 68.984 11.168 32.661 1.2674 5.6134 6.1166 5.0615 5.3706 1.5875 206.48 68.974 11.130 32.545 1.2725 5.8106 6.1206 5.1444 5.3974 1.5822 209.48 67.297 11.368 33.239 1.2779 5.7796 6.2319 5.4242 5.4751 1.6144 215.97 68.294 11.556 33.841 1.2602 5.7874 6.3019 5.8534 5.5594 1.6414 220.60 70.775 11.586 33.919 1.2471 5.7455 6.3242 5.9767 5.5944 1.6466 223.57 71.155 11.234 32.857 1.2621 5.7202 6.1339 5.6190 5.3984 1.5964 217.90 7.7899 17.492 165.76 1,198.27 145.00 2.7057 1.8215 59.619 6.2541 142.70 7.7712 22.712 161.39 1,241.28 134.59 2.7503 1.8720 57.832 6.4912 144.77 7.7402 28.156 170.42 1,232.17 126.78 2.5463 1.7587 53.792 6.2142 135.07 7.7348 28.474 166.17 1,364.45 123.88 2.5227 1.7862 51.996 6.4714 141.71 7.7416 28.979 166.71 1,412.38 124.04 2.5710 1.7788 51.570 6.6804 142.05 7.7376 29.043 163.37 1,491.07 124.99 2.5985 1.8155 51.270 6.8721 145.36 7.7335 30.042 148.11 1,550.43 120.76 2.6295 1.8473 51.603 6.9779 149.89 7.7332 31.939 147.58 1,591.35 117.02 2.6051 1.8507 53.026 6.9989 152.17 7.7306 31.610 152.75 1,536.14 112.41 2.5777 1.7942 53.904 6.7399 148.25 1.8134 2.5885 710.64 101.96 40.078 5.9231 1.3901 26.918 25.609 178.41 1.7283 2.7633 736.73 104.01 41.200 6.0521 1.4356 26.759 25.528 176.74 1.6294 2.8524 784.58 102.38 44.013 5.8258 1.4064 25.160 25.411 176.63 1.6338 2.9959 787.09 113.83 44.404 6.2528 1.4291 25.405 25.462 152.68 1.6397 3.0140 791.75 112.95 45.046 6.8903 1.4219 25.452 25.488 155.10 1.6527 3.0713 794.87 114.62 46.307 7.2536 1.4774 25.452 25.523 153.25 1.6463 3.1313 799.25 117.51 46.351 7.5566 1.5178 25.837 25.508 143.95 1.6446 3.1790 796.42 117.71 47.069 7.7362 1.5206 26.026 25.425 146.17 1.6228 3.1718 798.61 115.64 47.712 7.4500 1.4599 25.987 25.251 154.47 89.84 86.61 90.04 90.50 92.36 93.82 93.65 90.62 89.09 1. Averages of certified noon buying rates in N e w York for cable transfers. Data in this table also appear in the Board's G.5 (405) monthly statistical release. For ordering address, see inside front cover. 2. Value in U . S . cents. 3. Index of weighted-average exchange value of U.S. dollar against the currencies of ten industrial countries. The weight for each of the ten countries is Dec. 78.069 11.331 33.424 1.1668 4.7921 6.1899 3.8300 5.4467 1.6166 158.59 MEMO 31 United States/dollar 3 Nov. the 1972-76 average world trade of that country divided by the average world trade of all ten countries combined. Series revised as of August 1978 (see Federal Reserve Bulletin, vol. 64, August 1978, p. 700). A69 Guide to Statistical Releases and Special Tables STATISTICAL RELEASES—List Published Semiannually, with Latest BULLETIN Reference Anticipated schedule of release dates for periodic releases SPECIAL TABLES—Quarterly Data Published Irregularly, with Latest BULLETIN Issue June 1993 Page A78 Issue Page Reference Title and Date Assets and liabilities of commercial March 31, 1992 June 30, 1992 September 30, 1992 December 31, 1992 Terms of lending at commercial May 1992 August 1992 November 1992 February 1993 banks 1992 1992 1993 1993 A70 A70 A70 A70 September November February May 1992 1992 1993 1993 A78 A76 A76 A76 September November February May 1992 1992 1993 1993 A82 A80 A80 A80 November January August October 1991 1992 1992 1992 A80 A70 A80 A70 December May August March 1991 1992 1992 1993 A79 A81 A83 A71 banks Assets and liabilities of U.S. branches and agencies of foreign March 31, 1992 June 30, 1992 September 30, 1992 December 31, 1992 banks Pro forma balance sheet and income statements for priced service June 30, 1991 September 30, 1991 March 30, 1992 June 30, 1992 Assets and liabilities of life insurance June 30, 1991 September 30, 1991 December 31, 1991 September 30, 1992 August November February May • operations companies A70 Index to Statistical Tables References are to pages A3-A68 although the prefix "A" is omitted in this index ACCEPTANCES, bankers (See Bankers acceptances) Agricultural loans, commercial banks, 21, 22 Assets and liabilities (See also Foreigners) Banks, by classes, i9-22 Domestic finance companies, 35 Federal Reserve Banks, 11 Financial institutions, 27 Foreign banks, U.S. branches and agencies, 23 Automobiles Consumer installment credit, 38 Production, 47, 48 BANKERS acceptances, 10, 24, 25 Bankers balances, 19-22. (See also Foreigners) Bonds (See also U.S. government securities) New issues, 34 Rates, 25 Branch banks, 23, 55 Business activity, nonfinancial, 44 Business expenditures on new plant and equipment, 34 Business loans (See Commercial and industrial loans) CAPACITY utilization, 46 Capital accounts Banks, by classes, 19 Federal Reserve Banks, 11 Central banks, discount rates, 67 Certificates of deposit, 25 Commercial and industrial loans Commercial banks, 17, 21 Weekly reporting banks, 21-23 Commercial banks Assets and liabilities, 19-22 Commercial and industrial loans, 17, 19, 20, 21, 22, 23 Consumer loans held, by type and terms, 38 Loans sold outright, 21 Nondeposit funds, 18 Real estate mortgages held, by holder and property, 37 Time and savings deposits, 4 Commercial paper, 24, 25, 35 Condition statements (See Assets and liabilities) Construction, 44,49 Consumer installment credit, 38 Consumer prices, 44, 46 Consumption expenditures, 52, 53 Corporations Nonfinancial, assets and liabilities, 34 Profits and their distribution, 34 Security issues, 33, 65 Cost of living (See Consumer prices) Credit unions, 38 Currency in circulation, 5,14 Customer credit, stock market, 26 DEBITS to deposit accounts, 16 Debt (See specific types of debt or securities) Demand deposits Banks, by classes, 19-23 Ownership by individuals, partnerships, and corporations, 23 Demand deposits—Continued Turnover, 16 Depository institutions Reserve requirements, 9 Reserves and related items, 4, 5, 6, 13 Deposits (See also specific types) Banks, by classes, 4, 19-22, 23 Federal Reserve Banks, 5,11 Turnover, 16 Discount rates at Reserve Banks and at foreign central banks and foreign countries (See Interest rates) Discounts and advances by Reserve Banks (See Loans) Dividends, corporate, 34 EMPLOYMENT, 45 Eurodollars, 25 FARM mortgage loans, 37 Federal agency obligations, 5, 10, 11, 12, 30, 31 Federal credit agencies, 32 Federal finance Debt subject to statutory limitation, and types and ownership of gross debt, 29 Receipts and outlays, 27, 28 Treasury financing of surplus, or deficit, 27 Treasury operating balance, 27 Federal Financing Bank, 27, 32 Federal funds, 7, 18, 21, 22, 23, 25, 27 Federal Home Loan Banks, 32 Federal Home Loan Mortgage Corporation, 32, 36, 37 Federal Housing Administration, 32, 36, 37 Federal Land Banks, 37 Federal National Mortgage Association, 32, 36, 37 Federal Reserve Banks Condition statement, 11 Discount rates (See Interest rates) U.S. government securities held, 5, 11, 12, 29 Federal Reserve credit, 5, 6, 11, 12 Federal Reserve notes, 11 Federally sponsored credit agencies, 32 Finance companies Assets and liabilities, 35 Business credit, 35 Loans, 38 Paper, 24, 25 Financial institutions Loans to, 21, 22, 23 Selected assets and liabilities, 27 Float, 51 Flow of funds, 39,41,42, 43 Foreign banks, assets and liabilities of U.S. branches and agencies, 22, 23 Foreign currency operations, 11 Foreign deposits in U.S. banks, 5, 11, 21, 22 Foreign exchange rates, 68 Foreign trade, 54 Foreigners Claims on, 55, 57, 60, 61, 62, 64 Liabilities to, 22, 54, 55, 57, 58, 63, 65, 66 A71 GOLD Certificate account, 11 Stock, 5, 54 Government National Mortgage Association, 32, 36, 37 Gross domestic product, 51 HOUSING, new and existing units, 49 INCOME, personal and national, 44, 51, 52 Industrial production, 44, 47 Installment loans, 38 Insurance companies, 29, 37 Interest rates Bonds, 25 Consumer installment credit, 38 Federal Reserve Banks, 8 Foreign central banks and foreign countries, 67 Money and capital markets, 25 Mortgages, 36 Prime rate, 24 International capital transactions of United States, 53-67 International organizations, 57, 58, 60, 63, 64 Inventories, 51 Investment companies, issues and assets, 34 Investments (See also specific types) Banks, by classes, 19, 20, 21, 22, 23, 27 Commercial banks, 4, 17, 19-22 Federal Reserve Banks, 11, 12 Financial institutions, 37 LABOR force, 45 Life insurance companies (See Insurance companies) Loans (See also specific types) Banks, by classes, 19-22 Commercial banks, 4, 17, 19-22 Federal Reserve Banks, 5, 6, 8, 11, 12 Financial institutions, 27, 37 Insured or guaranteed by United States, 36, 37 MANUFACTURING Capacity utilization, 46 Production, 46, 48 Margin requirements, 26 Member banks (See also Depository institutions) Federal funds and repurchase agreements, 7 Reserve requirements, 9 Mining production, 48 Mobile homes shipped, 49 Monetary and credit aggregates, 4, 13 Money and capital market rates, 25 Money stock measures and components, 4, 14 Mortgages (See Real estate loans) Mutual funds, 34 Mutual savings banks (See Thrift institutions) NATIONAL defense outlays, 28 National income, 51 OPEN market transactions, 10 PERSONAL income, 52 Prices Consumer and producer, 44, 50 Stock market, 26 Prime rate, 24 Producer prices, 44, 50 Production, 44,47 Profits, corporate, 34 REAL estate loans Banks, by classes, 17, 21, 22, 37 Real estate loans—Continued Financial institutions, 27 Terms, yields, and activity, 36 Type of holder and property mortgaged, 37 Repurchase agreements, 7, 18, 21, 22, 23 Reserve requirements, 9 Reserves Commercial banks, 19 Depository institutions, 4, 5, 6, 13 Federal Reserve Banks, 11 U.S. reserve assets, 54 Residential mortgage loans, 36 Retail credit and retail sales, 38, 39, 44 SAVING Flow of funds, 39,41,42, 43 National income accounts, 51 Savings and loan associations, 37, 38, 39. (See also SAIF-insured institutions) Savings Association Insurance Funds (SAIF) insured institutions, 27 Savings banks, 27, 37, 38 Savings deposits (See Time and savings deposits) Securities (See also specific types) Federal and federally sponsored credit agencies, 32 Foreign transactions, 65 New issues, 33 Prices, 26 Special drawing rights, 5, 11, 53, 54 State and local governments Deposits, 21, 22 Holdings of U.S. government securities, 29 New security issues, 33 Ownership of securities issued by, 21, 22 Rates on securities, 25 Stock market, selected statistics, 26 Stocks (See also Securities) New issues, 33 Prices, 26 Student Loan Marketing Association, 32 TAX federal, 28 also Credit unions and Savings and Thriftreceipts, institutions, 4. (See loan associations) Time and savings deposits, 4, 14, 18, 19, 20, 21, 22, 23 Trade, foreign, 54 Treasury cash, Treasury currency, 5 Treasury deposits, 5, 11, 27 Treasury operating balance, 27 UNEMPLOYMENT, 45 U.S. government balances Commercial bank holdings, 19, 20, 21, 22 Treasury deposits at Reserve Banks, 5, 11, 27 U.S. government securities Bank holdings, 19-22, 23, 29 Dealer transactions, positions, and financing, 31 Federal Reserve Bank holdings, 5, 11, 12, 29 Foreign and international holdings and transactions, 11, 29, 66 Open market transactions, 10 Outstanding, by type and holder, 27, 29 Rates, 24 U.S. international transactions, 53-67 Utilities, production, 48 VETERANS Administration, 36, 37 WEEKLY reporting banks, 21-23 Wholesale (producer) prices, 44, 50 YIELDS (See Interest rates) A72 Federal Reserve Board of Governors and Official Staff Chairman Vice Chairman A L A N GREENSPAN, D A V I D W . M U L L I N S , JR., OFFICE OF BOARD MEMBERS WAYNE D . ANGELL E D W A R D W . K E L L E Y , JR. DIVISION OF INTERNATIONAL FINANCE JOSEPH R . COYNE, Assistant to the Board EDWIN M . TRUMAN, Staff DONALD J. WINN, Assistant to the Board LARRY J. PROMISEL, Senior Associate Director CHARLES J. SIEGMAN, Senior Associate Director DALE W. HENDERSON, Associate Director THEODORE E. ALLISON, Assistant to the Board for Federal Reserve System Affairs LYNN S. FOX, Special Assistant to the Board WINTHROP P. HAMBLEY, Special Assistant to the Board BOB STAHLY MOORE, Special Assistant to the Board DIANE E. WERNEKE, Special Assistant to the Board Director DAVID H . HOWARD, Senior Adviser DONALD B . ADAMS, Assistant Director PETER HOOPER III, Assistant Director KAREN H. JOHNSON, Assistant Director RALPH W . SMITH, JR., Assistant LEGAL J. VIRGIL MATTINGLY, JR., General Counsel SCOTT G. ALVAREZ, Associate General Counsel RICHARD M. ASHTON, Associate General Counsel OLIVER IRELAND, Associate General Counsel KATHLEEN M. O'DAY, Associate General Counsel MARYELLEN A. BROWN, Assistant to the General Counsel OFFICE Director DIVISION OF THE WILLIAM W . WILES, SECRETARY Secretary JENNIFER J. JOHNSON, Associate Secretary BARBARA R . LOWREY, Associate ELLEN MALAND, Assistant Secretary AND Secretary DON E. KLINE, Associate EDWARD C . ETTIN, Deputy Director THOMAS D . SIMPSON, Associate Director LAWRENCE SLIFMAN, Associate Director DAVID J. STOCKTON, Associate Director MARTHA BETHEA, Deputy Associate Director PETER A. TINSLEY, Deputy Associate Director MYRON L. KWAST, Assistant Director PATRICK M . PARKINSON, Assistant Director Director Director Adviser LEVON H . GARABEDIAN, Assistant Director (Administration) Director Director Director WILLIAM A . RYBACK, Associate STATISTICS Director WILLIAM R . JONES, Associate JOHN J. MINGO, STEPHEN C . SCHEMERING, Deputy AND Director JOYCE K. ZICKLER, Assistant REGULATION RICHARD SPILLENKOTHEN, OF RESEARCH MICHAEL J. PRELL, MARTHA S. SCANLON, Assistant DIVISION OF BANKING SUPERVISION DIVISION Director DIVISION OF MONETARY DONALD L. KOHN, AFFAIRS Director FREDERICK M. STRUBLE, Associate Director HERBERT A. BIERN, Deputy Associate Director ROGER T. COLE, Deputy Associate Director JAMES I. GARNER, Deputy Associate Director DAVID E. LINDSEY, Deputy Director BRIAN F. MADIGAN, Associate Director RICHARD D. PORTER, Deputy Associate Director HOWARD A . AMER, Assistant NORMAND R.V. BERNARD, Special Assistant to the Board Director GERALD A . EDWARDS, JR., Assistant JAMES D . GOETZINGER, Assistant Director Director Director STEPHEN M . HOFFMAN, JR., Assistant LAURA M . HOMER, Assistant DEBORAH DANKER, Assistant Director DIVISION OF CONSUMER AND COMMUNITY AFFAIRS GRIFFITH L. GARWOOD, Director Director JAMES V. HOUPT, Assistant Director GLENN E . LONEY, Associate JACK P. JENNINGS, Assistant Director DOLORES S. SMITH, Associate MICHAEL G . MARTINSON, Assistant RHOGER H PUGH, Assistant SIDNEY M . SUSSAN, Assistant MOLLY S . WASSOM, Assistant Director Director Director Director Director Director MAUREEN P. ENGLISH, Assistant IRENE SHAWN MCNULTY, Assistant Director Director JOHN P. LAWARE S U S A N M . PHILLIPS LAWRENCE B . LINDSEY OFFICE OF STAFF DIRECTOR FOR S. DAVID FROST, Staff MANAGEMENT CLYDE H . FARNSWORTH, JR., Director WILLIAM SCHNEIDER, Special DIVISION OF RESERVE BANK AND PAYMENT SYSTEMS Assignment: Project Director, National Information Center PORTIA W. THOMPSON, Equal Employment Opportunity Programs Officer Director DAVID L. ROBINSON, Deputy Director (Finance and Control) CHARLES W . BENNETT, Assistant JACK DENNIS, JR., Assistant Director Director EARL G. HAMILTON, Assistant DIVISION OF HUMAN MANAGEMENT DAVID L . SHANNON, RESOURCES ANTHONY V. DIGIOIA, Assistant JOSEPH H . HAYES, JR., Assistant OFFICE OF THE Director Controller OF SUPPORT ROBERT E. FRAZIER, SERVICES Director GEORGE M . LOPEZ, Assistant Director DAVID L. WILLIAMS, Assistant Director DIVISION OF INFORMATION MANAGEMENT STEPHEN R . MALPHRUS, RESOURCES Director BRUCE M. BEARDSLEY, Deputy Director MARIANNE M. EMERSON, Assistant Director Po KYUNG KIM, Assistant Director RAYMOND H . MASSEY, Assistant EDWARD T. MULRENIN, Assistant DAY W. RADEBAUGH, JR., Assistant Director Director Director ELIZABETH B . RIGGS, Assistant Director RICHARD C . STEVENS, Assistant Director Director OF THE INSPECTOR GENERAL General DONALD L. ROBINSON, Assistant Inspector General BARRY R. SNYDER, Assistant Inspector General STEPHEN J. CLARK, Assistant Controller (Programs and Budgets) DARRELL R. PAULEY, Assistant Controller (Finance) DIVISION OFFICE BRENT L . BOWEN, Inspector Director CONTROLLER GEORGE E. LIVINGSTON, Director FLORENCE M . YOUNG, Assistant Director Director Director LOUISE L. ROSEMAN, Assistant Director FRED HOROWITZ, Assistant Director JEFFREY C . MARQUARDT, Assistant JOHN H. PARRISH, Assistant Director JOHN R. WEIS, Associate OPERATIONS 74 Federal Reserve Bulletin • June 1993 Federal Open Market Committee and Advisory Councils FEDERAL OPEN MARKET COMMITTEE MEMBERS A L A N GREENSPAN, E. GERALD CORRIGAN, Vice Chairman Chairman WAYNE D . ANGELL EDWARD W . KELLEY, JR. EDWARD G . BOEHNE JOHN P. LAWARE SUSAN M . PHILLIPS SILAS KEEHN LAWRENCE B . LINDSEY GARY H . STERN DAVID W . MULLINS, JR. ROBERT D . MCTEER, JR. ALTERNATE J. ALFRED BROADDUS, JR. JERRY L . JORDAN ROBERT P. FORRESTAL JAMES H . OLTMAN MEMBERS ROBERT T. PARRY STAFF DONALD L. KOHN, Secretary and Economist NORMAND R.V. BERNARD, Deputy Secretary JOSEPH R. COYNE, Assistant Secretary GARY P. GILLUM, Assistant Secretary J. VIRGIL MATTINGLY, JR., General Counsel ERNEST T. PATRIKIS, Deputy General Counsel MICHAEL J. PRELL, EDWIN M . TRUMAN, Economist Economist RICHARD G. DAVIS, Associate Economist RICHARD W. LANG, Associate Economist DAVID E. LINDSEY, Associate Economist LARRY J. PROMISEL, Associate Economist ARTHUR J. ROLNICK, Associate Economist HARVEY ROSENBLUM, Associate Economist KARL A. SCHELD, Associate Economist CHARLES J. SIEGMAN, Associate Economist THOMAS D. SIMPSON, Associate Economist LAWRENCE SLIFMAN, Associate Economist WILLIAM J. MCDONOUGH, Manager of the System Open Market Account MARGARET L. GREENE, Deputy Manager for Foreign Operations JOAN E. LOVETT, Deputy Manager for Domestic Operations FEDERAL ADVISORY COUNCIL E. B. ROBINSON, JR., President JOHN B. MCCOY, Vice President MARSHALL N. CARTER, First District CHARLES S. SANFORD, JR., Second District ANTHONY P. TERRACCIANO, Third District JOHN B. MCCOY, Fourth District EDWARD E. CRUTCHFIELD, JR., Fifth District E.B. ROBINSON, JR., Sixth District EUGENE A. MILLER, Seventh District ANDREW B. CRAIG, III, Eighth District JOHN F. GRUNDHOFER, Ninth District DAVID A. RISMILLER, Tenth District CHARLES R. HRDLICKA, Eleventh District RICHARD M. ROSENBERG, Twelfth District HERBERT V. PROCHNOW, WILLIAM J. KORSVIK, Associate Secretary Secretary A75 CONSUMER ADVISORY COUNCIL DENNY D. DUMLER, Denver, Colorado, Chairman JEAN POGGE, Chicago, Illinois, Vice Chairman BARRY A . ABBOTT, S a n F r a n c i s c o , C a l i f o r n i a BONNIE GUITON, C h a r l o t t e s v i l l e , V i r g i n i a JOHN R . ADAMS, P h i l a d e l p h i a , P e n n s y l v a n i a JOYCE HARRIS, M a d i s o n , W i s c o n s i n JOHN A . BAKER, A t l a n t a , G e o r g i a GARY S . HATTEM, N e w Y o r k , N e w Y o r k VERONICA E . BARELA, D e n v e r , C o l o r a d o JULIA E . HILER, M a r i e t t a , G e o r g i a MULUGETTA BIRRU, P i t t s b u r g h , P e n n s y l v a n i a RONALD HOMER, B o s t o n , M a s s a c h u s e t t s DOUGLAS D . BLANKE, St. P a u l , M i n n e s o t a THOMAS L . HOUSTON, D a l l a s , T e x a s GENEVIEVE BROOKS, B r o n x , N e w Y o r k HENRY JARAMILLO, B e l e n , N e w M e x i c o TOYE L . BROWN, B o s t o n , M a s s a c h u s e t t s EDMUND MIERZWINSKI, W a s h i n g t o n , D . C . CATHY CLOUD, W a s h i n g t o n , D . C . JOHN V. SKINNER, I r v i n g , T e x a s MICHAEL D . EDWARDS, Y e l m , W a s h i n g t o n LOWELL N . SWANSON, P o r t l a n d , O r e g o n MICHAEL FERRY, St. L o u i s , M i s s o u r i MICHAEL W. TIERNEY, W a s h i n g t o n , D . C . NORMA L . FREIBERG, N e w O r l e a n s , L o u i s i a n a GRACE W . WEINSTEIN, E n g l e w o o d , N e w J e r s e y LORI GAY, Los Angeles, California JAMES L . WEST, T i j e r a s , N e w M e x i c o DONALD A . GLAS, H u t c h i n s o n , M i n n e s o t a ROBERT O . ZDENEK, W a s h i n g t o n , D . C . THRIFT INSTITUTIONS ADVISORY COUNCIL DANIEL C. ARNOLD, Houston, Texas, President BEATRICE D'AGOSTINO, Somerville, New Jersey, Vice President WILLIAM A . COOPER, M i n n e a p o l i s , M i n n e s o t a CHARLES JOHN KOCH, C l e v e l a n d , O h i o PAUL L . ECKERT, D a v e n p o r t , I o w a ROBERT MCCARTER, N e w B e d f o r d , M a s s a c h u s e t t s GEORGE R . GLIGOREA, S h e r i d a n , W y o m i n g NICHOLAS W. MITCHELL, JR., Winston-Salem, North Carolina THOMAS J. HUGHES, M e r r i f i e l d , V i r g i n i a STEPHEN W . PROUGH, I r v i n e , C a l i f o r n i a KERRY KILLINGER, S e a t t l e , W a s h i n g t o n THOMAS R . RICKETTS, T r o y , M i c h i g a n A76 Federal Reserve Board Publications For ordering assistance, write PUBLICATIONS SERVICES, MS-138, Board of Governors of the Federal Reserve System, Washington, DC 20551 or telephone (202) 452-3244 or FAX (202) 728-5886. When a charge is indicated, payment should accompany request and be made payable to the Board of Governors of the Federal Reserve System. Payment from foreign residents should be drawn on a U.S. bank. THE FEDERAL RESERVE SYSTEM—PURPOSES AND FUNCTIONS. 1984. 120 pp. ANNUAL REPORT. ANNUAL REPORT: BUDGET REVIEW, 1 9 9 1 - 9 2 . FEDERAL RESERVE BULLETIN. M o n t h l y . $ 2 5 . 0 0 p e r y e a r o r $2.50 each in the United States, its possessions, Canada, and Mexico. Elsewhere, $35.00 per year or $3.00 each. ANNUAL STATISTICAL DIGEST: period covered, release date, number of pages, and price. October 1982 239 pp. $ 6.50 1981 266 pp. $ 7.50 1982 December 1983 264 pp. $11.50 October 1984 1983 254 pp. $12.50 1984 October 1985 231 pp. $15.00 October 1986 1985 288 pp. $15.00 November 1987 1986 272 pp. $15.00 October 1988 1987 256 pp. $25.00 November 1989 1988 712 pp. $25.00 March 1991 1980-89 185 pp. $25.00 1990 November 1991 215 pp. $25.00 November 1992 1991 SELECTED INTEREST AND EXCHANGE RATES—WEEKLY SERIES OF CHARTS. Weekly. $30.00 per year or $.70 each in the United States, its possessions, Canada, and Mexico. Elsewhere, $35.00 per year or $.80 each. THE FEDERAL RESERVE ACT and other statutory provisions affecting the Federal Reserve System, as amended through August 1990. 646 pp. $10.00. REGULATIONS OF THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM. A N N U A L PERCENTAGE RATE TABLES ( T r u t h i n Lending— Regulation Z) Vol. I (Regular Transactions). 1969.100 pp. Vol. II (Irregular Transactions). 1969. 116 pp. Each volume $2.25; 10 or more of same volume to one address, $2.00 each. Introduction to Flow of Funds. 1980. 68 pp. $1.50 each; 10 or more to one address, $1.25 each. Federal Reserve Regulatory Service. Looseleaf; updated at least monthly. (Requests must be prepaid.) Consumer and Community Affairs Handbook. $75.00 per year. Monetary Policy and Reserve Requirements Handbook. $75.00 per year. Securities Credit Transactions Handbook. $75.00 per year. The Payment System Handbook. $75.00 per year. Federal Reserve Regulatory Service. 3 vols. (Contains all four Handbooks plus substantial additional material.) $200.00 per year. Rates for subscribers outside the United States are as follows and include additional air mail costs: Federal Reserve Regulatory Service, $250.00 per year. Each Handbook, $90.00 per year. THE U . S . ECONOMY IN AN INTERDEPENDENT WORLD: A MULTICOUNTRY MODEL, M a y 1 9 8 4 . 5 9 0 p p . $ 1 4 . 5 0 e a c h . WELCOME TO THE FEDERAL RESERVE. M a r c h 1 9 8 9 . 1 4 pp. INDUSTRIAL PRODUCTION—1986 EDITION. D e c e m b e r 1 9 8 6 . 440 pp. $9.00 each. FINANCIAL FUTURES AND OPTIONS IN THE U . S . ECONOMY. December 1986. 264 pp. $10.00 each. FINANCIAL SECTORS IN OPEN ECONOMIES: EMPIRICAL ANALY- SIS AND POLICY ISSUES. August 1990. 608 pp. $25.00 each. CONSUMER EDUCATION PAMPHLETS Short pamphlets suitable for classroom use. Multiple copies are available without charge. Consumer Handbook on Adjustable Rate Mortgages Consumer Handbook to Credit Protection Laws A Guide to Business Credit for Women, Minorities, and Small Businesses ' How to File A Consumer Credit Complaint Series on the Structure of the Federal Reserve System The Board of Governors of the Federal Reserve System The Federal Open Market Committee Federal Reserve Bank Board of Directors Federal Reserve Banks Organization and Advisory Committees A Consumer's Guide to Mortgage Lock-Ins A Consumer's Guide to Mortgage Settlement Costs A Consumer's Guide to Mortgage Refinancings Home Mortgages: Understanding the Process and Your Right to Fair Lending Making Deposits: When Will Your Money Be Available? When Your Home is on the Line: What You Should Know About Home Equity Lines of Credit A77 STAFF STUDIES: Summaries Only Printed in the 1 6 0 . BANKING MARKETS AND THE U S E OF FINANCIAL SERVICES BY SMALL AND MEDIUM-SIZED BUSINESSES, b y Bulletin Gregory E. Elliehausen and John D. Wolken. September 1990. 35 pp. 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. 1 6 1 . A REVIEW OF CORPORATE RESTRUCTURING ACTIVITY, Staff Studies 1-145 are out of print. 1 6 2 . EVIDENCE ON THE SIZE OF BANKING MARKETS FROM MORTGAGE LOAN RATES IN TWENTY CITIES, b y S t e p h e n 1 4 6 . THE ROLE OF THE PRIME RATE IN THE PRICING OF BUSINESS LOANS BY COMMERCIAL BANKS, 1 9 7 7 - 8 4 , b y 1 6 3 . CLEARANCE AND SETTLEMENT IN U . S . SECURITIES MAR- 1980-90, by Margaret Hastings Pickering. May 1991. 21pp. A. Rhoades. February 1992. 11 pp. Thomas F. Brady. November 1985. 25 pp. 1 4 7 . REVISIONS IN THE MONETARY SERVICES (DIVISIA) INDEXES OF THE MONETARY AGGREGATES, b y H e l e n T. Farr KETS, by Patrick Parkinson, Adam Gilbert, Emily Gollob, Lauren Hargraves, Richard Mead, Jeff Stehm, and Maiy Ann Taylor. March 1992. 37 pp. and Deborah Johnson. December 1985. 42 pp. 1 4 8 . THE MACROECONOMIC AND SECTORAL EFFECTS OF THE ECONOMIC RECOVERY TAX ACT: SOME SIMULATION RESULTS, by Flint Brayton and Peter B. Clark. December 1985. 17 pp. 1 4 9 . THE OPERATING PERFORMANCE OF ACQUIRED FIRMS IN BANKING BEFORE AND AFTER ACQUISITION, b y S t e p h e n A. Rhoades. April 1986. 32 pp. 1 5 0 . STATISTICAL COST ACCOUNTING MODELS IN BANKING: A REEXAMINATION AND AN APPLICATION, b y J o h n T. Rose and John D. Wolken. May 1986. 13 pp. 1 5 1 . RESPONSES TO DEREGULATION: RETAIL DEPOSIT PRICING FROM 1983 THROUGH 1985, by Patrick I. Mahoney, Alice P. White, Paul F. O'Brien, and Mary M. McLaughlin. January 1987. 30 pp. 1 5 2 . DETERMINANTS OF CORPORATE MERGER ACTIVITY: A REVIEW OF THE LITERATURE, by Mark J. Warshawsky. April 1987. 18 pp. 1 5 3 . STOCK MARKET VOLATILITY, b y C a r o l y n D . D a v i s a n d Alice P. White. September 1987. 14 pp. 1 5 4 . T H E EFFECTS ON CONSUMERS A N D CREDITORS OF PROPOSED CEILINGS ON CREDIT CARD INTEREST RATES, by Glenn B. Canner and James T. Fergus. October 1987. 26 pp. 1 5 5 . THE FUNDING OF PRIVATE PENSION PLANS, b y M a r k J. Warshawsky. November 1987. 25 pp. 1 5 6 . INTERNATIONAL TRENDS FOR U . S . BANKS AND BANKING MARKETS, by James V. Houpt. May 1988. 47 pp. 1 5 7 . M 2 PER UNIT OF POTENTIAL G N P AS AN ANCHOR FOR THE PRICE LEVEL, by Jeffrey J. Hallman, Richard D. Porter, and David H. Small. April 1989. 28 pp. 1 5 8 . THE ADEQUACY AND CONSISTENCY OF MARGIN REQUIREMENTS IN THE MARKETS FOR STOCKS AND DERIVATIVE PRODUCTS, by Mark J. Warshawsky with the assistance of Dietrich Earnhart. September 1989. 23 pp. 1 5 9 . N E W DATA ON THE PERFORMANCE OF NONBANK SUBSIDIARIES OF BANK HOLDING COMPANIES, b y N e l l i e L i a n g and Donald Savage. February 1990. 12 pp. REPRINTS OF SELECTED Bulletin ARTICLES Some Bulletin articles are reprinted. The articles listed below are those for which reprints are available. Most of the articles reprinted do not exceed twelve pages. Limit of ten copies Recent Developments in the Bankers Acceptance Market. 1/86. The Use of Cash and Transaction Accounts by American Families. 2/86. Financial Characteristics of High-Income Families. 3/86. Prices, Profit Margins, and Exchange Rates. 6/86. Agricultural Banks under Stress. 7/86. Foreign Lending by Banks: A Guide to International and U.S. Statistics. 10/86. Recent Developments in Corporate Finance. 11/86. Measuring the Foreign-Exchange Value of the Dollar. 6/87. Changes in Consumer Installment Debt: Evidence from the 1983 and 1986 Surveys of Consumer Finances. 10/87. Home Equity Lines of Credit. 6/88. Mutual Recognition: Integration of the Financial Sector in the European Community. 9/89. The Activities of Japanese Banks in the United Kingdom and in the United States, 1980-88. 2/90. Industrial Production: 1989 Developments and Historical Revision. 4/90. Recent Developments in Industrial Capacity and Utilization. 6/90. Developments Affecting the Profitability of Commercial Banks. 7/90. Recent Developments in Corporate Finance. 8/90. U.S. Exchange Rate Policy: Bretton Woods to Present. 11/90. The Transmission Channels of Monetary Policy: How Have They Changed? 12/90. Changes in Family Finances from 1983 to 1989: Evidence from the Survey of Consumer Finances. 1/92. U.S. International Transactions in 1991. 5/92. A78 ANTICIPATED SCHEDULE OF THE FEDERAL RESERVE OF RELEASE SYSTEM1 DATES (PAYMENT FOR PERIODIC RELEASES—BOARD MUST ACCOMPANY OF GOVERNORS REQUESTS) Weekly Releases Annual rate Approximate release days Date of period to which data refer • Aggregate Reserves of Depository Institutions and the Monetary Base. H.3 (502) [1.20] $15.00 Thursday • Actions of the Board: Applications and Reports Received. H.2 (501) $35.00 Friday • Assets and Liabilities of Insured Domestically Chartered and Foreign Related Banking Institutions. H.8 (510) [1.25] $15.00 Monday • Factors Affecting Reserves of Depository Institutions and Condition Statement of Federal Reserve Banks. H.4.1 (503) [1.11] $15.00 Thursday Week ended previous Wednesday • Foreign Exchange Rates. H. 10 (512) [3.28] $15.00 Monday Week ended previous Friday • Money Stock, Liquid Assets, and Debt Measures. H.6 (508) [1.21] $35.00 Thursday Week ended Monday of previous week • Selected Borrowings in Immediately Available Funds of Large Commercial Banks. H.5 (507) [1.13] $15.00 Wednesday Week ended Thursday of previous week • Selected Interest Rates. H.15 (519) [1.35] $15.00 Monday Week ended previous Saturday • Weekly Consolidated Condition Report of Large Commercial Banks, and Domestic Subsidiaries. H.4.2 (504) [1.26, 1.30] $15.00 Friday Wednesday, 1 week earlier Week ended previous Wednesday Week ended previous Saturday Wednesday, 3 weeks earlier Monthly Releases • Consumer Installment Credit. G.19 (421) [1.55, 1.56] $ 5.00 5th working day of month 2nd month previous • Debits and Deposit Turnover at Commercial Banks. G.6 (406) [1.22] $5.00 12th of month Previous month • Finance Companies. G.20 (422) [1.51, 1.52] $ 5.00 5th working day of month 2nd month previous • Foreign Exchange Rates. G.5 (405) [3.28] $5.00 1st of month Previous month • Industrial Production and Capacity Utilization. G.17 (419) [2.12, 2.13] $15.00 Midmonth • Loans and Securities at all Commercial Banks. G.7 (407) [1.23] $ 5.00 3rd week of month • Major Nondeposit Funds of Commercial Banks. G.10 (411) [1.24] $ 5.00 3rd week of month • Research Library—Recent Acquisitions. G. 15 (417) Free of charge 1st of month Previous month • Selected Interest Rates. G.13 (415) [1.35] $ 5.00 1st Tuesday of month Previous month Previous month Previous 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 respective Bulletin tables that report the data are designated in brackets. A79 Quarterly Releases Annual rate Approximate release days • Agricultural Finance Databook. E.15 (125) $ 5.00 End of March, June, September, and December • Country Exposure Lending Survey. E.16 (126) $ 5.00 January, April, July, and October • Flow of Funds Accounts: Seasonally Adjusted and Unadjusted. Z.l (780) [1.57,1.58] $25.00 23rd of February, May, August, and November • Flow of Funds Summary Statistics. Z.7 (788) [1.59, 1.60] $ 5.00 15th of February, May, August, and November • Geographical Distribution of Assets and Liabilities of Major Foreign Branches of U.S. Banks. E. 11 (121) $ 5.00 15th of March, June, September, and December Previous quarter • Survey of Terms of Bank Lending to Business. E.2 (111) [4.23] $ 5.00 Midmonth of March, June, September, and December February, May, August, and November • List of OTC Margin Stocks. E.7 (117) Free of charge January, April, July, and October February, May, August, and November Date of period to which data refer January, April, July, and October Previous quarter Previous quarter Previous quarter Semiannual Releases • Balance Sheets for the U.S. Economy. C.9 (108) $ 5.00 October and April Previous year • Report on the Terms of Credit Card Plans. E.5 (115) $ 5.00 March and August January and June $ 5.00 February End of previous June Annual Releases • Aggregate Summaries of Annual Surveys of Securities Credit Extension. C.2 (101) A80 Maps of the Federal Reserve System 1 9 BOSTON • MINNEAPOLIS® 12 I SAN FRANCISCO • NEW YORK CHICAGO • 10 CLEVELAND KANSAS C I T Y B a RJCSOND S ? LOUIS 8 11 [PHILADELPHIA 5 ATLANTA DALLAS LEGEND Both pages • Federal Reserve Bank city • Board of Governors of the Federal Reserve System, Washington, D.C. Facing page • Federal Reserve Branch city — Branch boundary NOTE The Federal Reserve officially identifies Districts by number and Reserve Bank city (shown on both pages) and by letter (shown on the facing page). In the 12th District, the Seattle Branch serves Alaska, and the San Francisco Bank serves Hawaii. The System serves commonwealths and territories as follows: the New York Bank serves ih* Commonwealth of Puerto Rico and the U.S. Virgin Islands; the San Francisco Bank serves American Samoa, Guam, and the Commonwealth of the Northern Mariana Islands. The Board of Governors revised the branch boundaries of the System most recently in December 1991. A81 1-A 2-B 3-C 5_E 4-D Baltimore^ Pittsburgh Charlotte * ' Buffalo NH MAB CT v 7 • • Cincinnati ^ NJ KY NY c N E W YORK BOSTON 6-F T•N PHILADELPHIA 7-G Nashville — — RICHMOND CLEVELAND 8-H Birmingham > WI / MS LA OA Sk ' • New Orleans "I Louisville Detroit • IA IL • Jacksonville Memphis IN „ Littl? ) Rock J MS Miami # ATLANTA ST. LOUIS CHICAGO 9-1 I 1 • Helena ND MN ^MSBMMM^^M Ml • ifttiifci'-iWii' 1 SD MINNEAPOLIS 12-L 10-J Omaha • Denver I I KS MO • ALASKA I * Seattle / /ID Portland Oklahoma City OR C KANSAS CITY NV I ^1 U-K I TX • A / UT Salt Lake City NM LA JN-R EL Paso 7 ^ — V Y H o u s ti n • Los Angeles • i • San Antonio C^ DALLAS AZ HAWAII SAN FRANCISCO ~ A82 Federal Reserve Banks, Branches, and Offices FEDERAL RESERVE BANK branch, or facility Zip Chairman Deputy Chairman President First Vice President BOSTON* 02106 Jerome H. Grossman Warren B. Rudman Richard F. Syron Cathy E. Minehan NEW YORK* 10045 Ellen V. Futter Maurice R. Greenberg Joseph J. Castiglia E. Gerald Corrigan James H. Oltman Buffalo 14240 James O. Aston PHILADELPHIA 19105 Jane G. Pepper James M. Mead Edward G. Boehne William H. Stone, Jr. CLEVELAND* 44101 Jerry L. Jordan Sandra Pianalto Cincinnati Pittsburgh 45201 15230 A. William Reynolds G. Watts Humphrey, Jr. Marvin Rosenberg Robert P. Bozzone RICHMOND* 23219 Anne Marie Whittemore Henry J. Faison Rebecca Hahn Windsor Anne M. Allen J. Alfred Broaddus, Jr. Jimmie R. Monhollon Edwin A. Huston Leo Benatar Donald E. Boomershine Joan D. Ruffier R. Kirk Landon James R. Tuerff Lucimarian Roberts Robert P. Forrestal Jack Guynn Richard G. Cline Robert M. Healey J. Michael Moore Silas Keehn William C. Conrad Robert H. Quenon Janet McAfee Weakle' Robert D. Nabholz, Jr. John A. Williams Seymour B. Johnson Thomas C. Melzer James R. Bowen Delbert W. Johnson Gerald A. Rauenhorst James E. Jenks Gary H. Stern Colleen K. Strand Burton A. Dole, Jr. Herman Cain Barbara B. Grogan Ernest L. Holloway Sheila Griffin Thomas M. Hoenig Henry R. Czerwinski Leo E. Linbeck, Jr. Cece Smith W. Thomas Beard, III Judy Ley Allen Erich Wendl Robert D. McTeer, Jr. Tony J. Salvaggio James A. Vohs Judith M. Runstad Donald G. Phelps William A. Hilliard Gary G. Michael George F. Russell, Jr. Robert T. Parry Patrick K. Barron Baltimore 21203 Charlotte 28230 Culpeper Communications and Records Center 22701 ATLANTA Birmingham Jacksonville Miami Nashville New Orleans 30303 35283 32231 33152 37203 70161 CHICAGO* 60690 Detroit 48231 ST. LOUIS 63166 Little Rock Louisville Memphis 72203 40232 38101 MINNEAPOLIS 55480 Helena KANSAS CITY Denver Oklahoma City Omaha DALLAS El Paso Houston San Antonio 59601 64198 80217 73125 68102 75201 79999 77252 78295 SAN FRANCISCO 94120 Los Angeles Portland Salt Lake City Seattle 90051 97208 84125 98124 Vice President in charge of branch Charles A. Cerino1 Harold J. Swart1 Ronald B. Duncan 1 Walter A. Varvel1 John G. Stoides 1 Donald E. Nelson 1 Fred R. Herr1 James D. Hawkins 1 James T. Curry III Melvyn K. Purcell Robert J. Musso Roby L. Sloan 1 Karl W. Ashman Howard Wells John P. Baumgartner John D.Johnson Kent M. Scott David J. France Harold L. Shewmaker Sammie C. Clay Robert Smith, III1 Thomas H. Robertson John F. Moore 1 E. Ronald Liggett 1 Andrea P. Wolcott Gordon Werkema1 *Additional offices of these Banks are located at Lewiston, Maine 04240; Windsor Locks, Connecticut 06096; Cranford, New Jersey 07016; Jericho, New York 11753; Utica at Oriskany, New York 13424; Columbus, Ohio 43216; Columbia, South Carolina 29210; Charleston, West Virginia 25311; Des Moines, Iowa 50306; Indianapolis, Indiana 46204; and Milwaukee, Wisconsin 53202. 1. Senior Vice President. Publications of Interest FEDERAL RESERVE CONSUMER CREDIT PUBLICATIONS The Federal Reserve Board publishes a series of pamphlets covering individual credit laws and topics, as pictured below. The series includes such subjects as how the Equal Credit Opportunity Act protects women against discrimination in their credit dealings, how to use a credit card, and how to resolve a billing error. The Board also publishes the Consumer Handbook to Credit Protection Laws, a complete guide to consumer credit protections. This forty-four-page booklet explains how to shop and obtain credit, how to maintain a good credit rating, and how to dispute unfair credit transactions. Three booklets on the mortgage process are also available: A Consumer's Guide to Mortgage Lock-Ins, A Consumer's Guide to Mortgage Refinancings, and A Consumer's Guide to Mortgage Settlement Costs. These booklets were prepared in conjunction with the Federal Home Loan Bank Board and in consultation with other federal agencies and trade and consumer groups. Copies of consumer publications are available free of charge from Publications Services, mail stop 138, Board of Governors of the Federal Reserve System, Washington, DC 20551. Multiple copies for classroom use are also available free of charge. A Consumer's Guide to Mortgage Lock-Ins Consumer Handbook to Credit Protection L LAMPS | Publications of Interest FEDERAL RESERVE REGULATORY SERVICE To promote public understanding of its regulatory functions, the Board publishes the Federal Reserve Regulatory Service, a three-volume looseleaf service containing all Board regulations as well as related statutes, interpretations, policy statements, rulings, and staff opinions. For those with a more specialized interest in the Board's regulations, parts of this service are published separately as handbooks pertaining to monetary policy, securities credit, consumer affairs, and the payment system. These publications are designed to help those who must frequently refer to the Board's regulatory materials. They are updated monthly, and each contains citation indexes and a subject index. The Monetary Policy and Reserve Requirements Handbook contains Regulations A, D, and Q, plus related materials. The Securities Credit Transactions Handbook contains Regulations G, T, U, and X, dealing with extensions of credit for the purchase of securities, together with related statutes, Board interpretations, rulings, and staff opinions. Also included are the Board's list of marginable OTC stocks and its list of foreign margin stocks. The Consumer and Community Affairs Handbook contains Regulations B, C, E, M, Z, AA, and BB, and associated materials. The Payment System Handbook deals with expedited funds availability, check collection, wire transfers, and risk-reduction policy. It includes Regulation CC, Regulation J, the Expedited Funds Availability Act and related statutes, the official Board commentary on Regulation CC, and policy statements on risk reduction in the payment system. For domestic subscribers, the annual rate is $200 for the Federal Reserve Regulatory Service and $75 for each Handbook. For subscribers outside the United States, the price including additional air mail costs is $250 for the Service and $90 for each Handbook. All subscription requests must be accompanied by a check or money order payable to the Board of Governors of the Federal Reserve System. Orders should be addressed to Publications Services, mail stop 138, Board of Governors of the Federal Reserve System, Washington, DC 20551.