Full text of Federal Reserve Bulletin : May 1984
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VOLUME 7 0 •
NUMBER 5 •
MAY 1984
FEDERAL RESERVE
BULLETIN
Board of Governors of the Federal Reserve System
Washington, D.C.
PUBLICATIONS COMMITTEE
Joseph R. Coyne, Chairman • Stephen H. Axilrod • Michael Bradfield • S. David Frost
Griffith L. Garwood • James L. Kichline • Edwin M. Truman
Naomi P. Salus, Coordinator
The FEDERAL RESERVE BULLETIN is issued monthly under the direction of the staff publications committee. This committee is responsible for
opinions expressed except in official statements and signed articles. It is assisted by the Economic Editing Unit headed by Mendelle T. Berenson,
the Graphic Communications Section under the direction of Peter G. Thomas, and Publications Services supervised by Helen L. Hulen.
Table of Contents
401 RECENT FINANCING
ACTIVITY OF
NONFINANCIAL
CORPORATIONS
Nonfinancial corporations were able to improve their overall financial position as a
result of the more favorable financial conditions that emerged in late 1982 and 1983.
411 INDUSTRIAL
PRODUCTION
Output rose about 1.4 percent in April.
413 STATEMENTS
TO
CONGRESS
E. Gerald Corrigan, President, Federal Reserve Bank of Minneapolis, reviews developments over the past three years in the
priced services activities of the Federal
Reserve Banks and says that the Federal
Reserve is now better positioned to turn its
attention to fostering further improvements
in the efficiency, safety, and integrity of the
payments mechanism, before the Senate
Committee on Banking, Housing, and Urban Affairs, April 11, 1984.
419 Anthony M. Solomon, President, Federal
Reserve Bank of New York, testifies on
behalf of the Federal Reserve System about
the recently announced financial package
for helping Argentina meet interest payments on its bank debt and says that by
participating in this arrangement the Federal Reserve acted only as an agent and did
not back or guarantee payment to the commercial banks with its own funds, before
the Subcommittee on International Finance
and Monetary Policy of the Senate Committee on Banking, Housing, and Urban Affairs, May 3, 1984. Similar testimony was
presented by Mr. Solomon before the Subcommittee on International Trade, Investment and Monetary Policy of the House
Committee on Banking, Finance and Urban
Affairs on May 1, 1984.
423 J. Charles Partee, Member, Board of Governors, discusses the role of the Federal
Reserve with respect to criminal misconduct and abuse by bank insiders and says
that because all types of improper insider
activities can have an adverse effect on a
bank's condition, undermine public confidence in banking organizations generally,
and contribute to a bank's failure, all such
activities require a prompt and effective
supervisory response, before the Commerce, Consumer, and Monetary Affairs
Subcommittee of the House Committee on
Government Operations, May 3, 1984.
427
ANNOUNCEMENTS
Publication of The U.S. Economy in An
Interdependent
World: A
Multicountry
Model.
Statement on the role of the Federal Reserve in the Argentine financing package.
Change in boundaries of Federal Reserve
Districts.
Changes in Board staff.
Admission of two state banks to membership in the Federal Reserve System.
429 LEGAL
DEVELOPMENTS
Amendments to Regulation A; amendment
to Rules Regarding Delegation of Authority; various bank holding company and
bank merger orders; and pending cases.
A i FINANCIAL
AND BUSINESS
STATISTICS
A3 Domestic Financial Statistics
A42 Domestic Nonfinancial Statistics
A50 International Statistics
A 6 5 GUIDE TO TABULAR PRESENTATION,
STATISTICAL RELEASES, AND SPECIAL
TABLES
A 7 0 FEDERAL RESERVE
PUBLICATIONS
A 7 3 INDEX
A 6 6 BOARD
OF GOVERNORS
AND
TO STATISTICAL
TABLES
STAFF
A 6 8 FEDERAL OPEN MARKET COMMITTEE
AND STAFF; ADVISORY
COUNCILS
BOARD
A75 FEDERAL RESERVE
AND OFFICES
A 7 6 MAP OF FEDERAL
BANKS,
RESERVE
BRANCHES,
SYSTEM
Recent Financing Activity
of Nonfinancial Corporations
Michael J. Moran of the Board's Division of
Research and Statistics prepared this article.
Elizabeth G. Schroeder provided research assistance.
The more favorable financial conditions that
emerged in late 1982 and 1983 allowed business
firms to improve their overall financial position,
which had been deteriorating for several years.
During the late 1970s and early 1980s, nonfinancial corporations increasingly turned to credit
markets to finance growing outlays as profits and
internal cash flows weakened. Sagging stock
prices, high interest rates, and uncertainty about
future inflation and interest rates discouraged
firms from raising funds in the long-term capital
markets and led to a massive buildup of shortterm debt. The large volume of short-term debt
and the increased volatility of interest rates made
the financing costs and the earnings of companies more uncertain. Reflecting the diminishing
financial strength of many firms, downgradings
of corporate debt became common (chart 1).
In response to a sharp drop in interest rates
and a surge in share prices in the latter half of
1982 and early 1983, nonfinancial corporations
issued a large volume of long-term debt and a
record volume of new equities. Corporate profits
improved in 1983 so that the flow of internal
funds for these firms was larger than their capital
expenditures. In the absence of the need to raise
external funds, the financing activity of nonfinancial corporations as a group largely represented the restructuring of balance sheets: the
proceeds of the stock and bond sales allowed
firms to reduce their dependence on short-term
debt and to build liquid assets.
Similar patterns of corporate financing were
evident in the early stages of some past recoveries. In the current cycle, however, the efforts by
corporations to restructure their balance sheets
have been short lived. When interest rates began
to rise after spring 1983, bond volume fell off
sharply. Stock prices, too, lost their upward
momentum in the second half of 1983, and the
brisk pace of new equity issuance began to
moderate; in early 1984, offerings of new stock
slowed still further as the stock market experienced its first substantial decline since 1982. At
the same time that issuance of bonds and stocks
began to slow, business capital expenditures and
external financing requirements were beginning
to swell. As a result, firms began to rely more
heavily on short-term debt as a source of funds.
During the period of restructuring in 1982 and
1983, many companies considerably improved
their balance sheets; however, such activity did
not produce a marked improvement in the traditional financial ratios for the business sector as a
whole. Moreover, barring a reversal of the financing patterns of recent months, these ratios
are likely to deteriorate over the course of 1984.
The implications of this potential deterioration
for the overall financial condition of these firms
may not be as serious as in the past. The uncertain financial environment in the late 1970s and
1. Rating changes on long-term corporate debt by
Moody's Investors Service 1
Number of changes
1977
1979
1981
1983
1. The number of changes on a corporation's highest-ranking debt
issues. In April 1982, Moody's increased the number of rating
categories by dividing most of its major categories into three subcategories. Only changes from one major category to another are counted.
402
Federal Reserve Bulletin • May 1984
early 1980s stimulated innovation in corporate
finance, and the impact of inflation made the
book values of assets and liabilities less meaningful, so that an examination of traditional balance
sheet measures may not reveal a true picture of
financial condition. Indeed, although further restructuring seems likely should interest rates fall,
financial managers do not appear to be under
severe market pressure to bolster their financial
position in the current environment.
CAPITAL EXPENDITURES
INTERNAL CASH FLOW
Billions of dollars
1. The financing gap is capital expenditures less gross internal
funds.
SOURCE. Federal Reserve flow of funds accounts, quarterly data,
seasonally adjusted annual rates.
AND
After declining for more than a year, capital
expenditures by nonfinancial corporations
turned upward sharply during 1983, with spending on both fixed investment and inventories
contributing to the growth (chart 2). Fixed-in2. Capital expenditures of nonfinancial corporations
Billions of dollars
Total capital expenditures include fixed investment, inventory
investment, and purchases of mineral rights from the U.S. government. Fixed investment includes plant and equipment expenditures
and investment in residential construction.
SOURCE. Federal Reserve flow of funds accounts, quarterly data,
seasonally adjusted annual rates.
vestment spending exhibited one of the sharpest
recoveries in the postwar period owing primarily
to expenditures on equipment; outlays for structures declined slightly, on balance, in the first
year of the current recovery. Businesses began
to rebuild their inventories during 1983, and in
light of the unusually sharp reductions in 1982,
this rebound contributed significantly to the
strength in total capital outlays. Inventory investment strengthened considerably further in
early 1984. Relative to the volume of sales,
however, the level of inventories was low compared with historical standards.
3. The financing gap of nonfinancial corporations1
Although total capital expenditures of nonfinancial corporations increased sharply in the
early stages of the recovery, external financing
requirements were moderate. Indeed, for 1982
and 1983 as a whole, the flow of internal funds
exceeded capital outlays (chart 3). The strong
internal cash flow was attributable primarily to
an improvement in economic profits (that is,
reported profits plus the inventory valuation
adjustment and the capital consumption adjustment) and a lower tax burden resulting from the
Economic Recovery Tax Act of 1981.
After declining to low levels in 1982, beforetax economic profits of nonfinancial corporations rose markedly in 1983 (chart 4), reflecting
both stronger sales and higher profit margins.
Profit margins increased as improvements in
productivity and relatively moderate increases in
wages combined to produce only small changes
in unit labor costs. Also, net interest expenses
4. Economic profits of nonfinancial corporations
Billions of dollars
Economic profits are reported profits plus the inventory valuation
adjustment and the capital consumption adjustment.
SOURCE. U.S. Department of Commerce.
Recent Financing Activity of Nonfinancial Corporations
EXTERNAL
5. Effective average tax rate on economic before-tax
profits of nonfinancial corporations
75
50
25
1971
1973
1975
1977
1979
1981
1983
Economic profits are reported profits plus the inventory valuation
adjustment and the capital consumption adjustment.
SOURCE. U.S. Department of Commerce.
were reduced as the level of interest rates declined in late 1982 and early 1983. The ratio of
before-tax economic profits to gross domestic
product of nonfinancial corporations—an approximate measure of profit margins—increased
from about 6V2 percent in late 1982 to about 103/t
percent in the fourth quarter of 1983, close to the
highest levels achieved during the 1970s.
Since the Economic Recovery Tax Act was
enacted in 1981, firms have been able to keep a
much greater share of gross earnings. This act
liberalized the schedule for accelerated depreciation and expanded the coverage of the investment tax credit. After these changes, preliminary
data indicate that the effective average tax rate of
corporations, that is, the ratio of tax payments to
economic profits before taxes, fell to about 30
percent (chart 5)—the lowest level in the postwar
period.
403
FINANCING
During late 1982 and early 1983, nonfinancial
corporations seized the opportunity to issue a
large volume of long-term bonds and stock. With
strong internal cash flows, this activity was
largely an effort to restructure balance sheets.
Beginning in the second half of 1983, conditions
in the capital markets deteriorated somewhat,
inducing firms to slow their stock and bond
issuance and to turn toward short-term debt
(table 1).
The bond market experienced a strong rally in
the second half of 1982 as weak economic activity and diminishing inflation, along with falling
short-term rates, produced sharp declines in
long-term interest rates (chart 6). With the decline in interest rates, the spreads between the
yields on corporate bonds and Treasury securities decreased to their lowest levels since 1979.
Nonfinancial corporations responded to these
movements with a flood of new bonds, primarily
in the public market. In preceding quarters,
companies had deferred desired long-term borrowing in the hope that they later would find
more attractive market conditions, and corporate
bond volume had fallen to its lowest level since
1973; indeed, in real terms, it had fallen to its
lowest level since the mid-1960s.
Besides boosting the total volume of bonds in
late 1982 and early 1983, nonfinancial corporations also increased the proportion of issues with
longer maturities. As interest rates earlier had
1. Net funds raised in markets by nonfinancial corporations
Billions of dollars
1982'
Type of instrument
1977
1978
1979
1980
H,
Total, long-term
Equity
Notes and bonds2
Mortgages
Total, short-term
3
Bank loans
Commercial paper
Finance company loans
Acceptances
|
H2
H2
35.8
32.8
20.9
52.5
22.5
31.7
58.7
74.6
36.7
2.7
29.6
3.5
-.1
28.8
4.1
-7.8
27.3
1.4
12.9
37.6
2.0
-11.5
35.5
-1.5
7.0
24.7
.0
15.8
43.3
-.4
38.2
31.8
4.6
18.4
17.0
1.3
36.6
47.7
67.3
38.5
69.7
64.6
13.2
.2
60.2
20.9
1.6
13.5
.6
32.3
2.7
11.5
1.2
47.1
9.0
10.2
1.0
30.6
4.0
3.1
.8
44.1
14.7
8.7
2.2
55.3
8.7
1.7
-1.1
31.4
-18.2
-2.6
2.6
3.9
-8.7
8.8
-3.8
30.5
7.8
18.8
3.1
1. Seasonally adjusted annual rate.
2. Includes notes and bonds sold in foreign markets by U.S.
1983'
1981
nonfinancial corporations and tax-exempt bonds issued by state or
local governments for the benefit of a corporation.
3. Includes a small amount of U.S. government loans.
404
Federal Reserve Bulletin • May 1984
6. Selected interest rates and yield spreads
Percent
1977
1979
1981
1983
The interest rate on A-rated utility bonds is the Federal Reserve
Board's series on recently offered corporate bonds, monthly averages
of Friday quotes. The Treasury rate is the 30-year constant maturity
series, monthly averages of daily data. The yield spread is the
corporate rate less the Treasury rate.
risen and become more volatile, firms had moved
progressively toward intermediate-term issues so
that by 1982 only about one-third of total gross
bond volume had maturities of 20 years or longer
(chart 7). In the first half of 1983, however, the
proportion of longer-term bonds jumped to nearly 50 percent—a figure still below that typical in
the 1970s, but a marked increase over the more
recent experience.
As interest rates declined in 1982 and 1983 and
as risk perceptions were altered with the improving economy, investors sought to maintain the
yields on their portfolios by acquiring securities
bearing lower credit ratings. This shift is reflected in the narrowing of interest rate spreads and a
more receptive market for lower-rated bonds. In
1983, nearly one-fourth of total gross bond volume had either no credit rating or a rating below
Baa. In previous years, these lower-rated firms
accounted for only 10 to 15 percent of total bond
volume. Many of the bonds sold by lower-rated
firms last year were convertible into common
7. Long-term bond issuance i
Percent
1977
1979
1981
1983
1. Proportion of total gross bond volume in the public market with
maturities of 20 years or longer. Includes both nonfinancial and
financial corporations.
stock or were sold with warrants that entitled the
holder to purchase common stock in the future at
a predetermined price. These privileges afforded
investors the potential for large gains in the
future and permitted companies to issue bonds
with lower current yields.
In contrast to public offerings, private placements of corporate bonds remained at relatively
low levels (table 2). Activity in the private market began to slow in the late 1970s as life insurance companies—the dominant purchasers of
private placements—decreased their participation. Life insurers experienced a reduction in
their discretionary cash flow for investment as a
result of increased demand for policy loans and
declining insurance sales. Growth of policy loans
2. Private placement of bonds
by nonfinancial corporations
Millions of dollars
Year or half year
1977
1978
1979
1980
1981
1982
1983:H1'
Total
Industrial
17,859
17,516
16,353
11,862
13,156
12,692
10,782
14,205
12,605
8,245
7,224
7,181
8,930
8.034
Utilities
3,654
4,911
8,108
4,638
5,975
3,762
2,748
1. Annual rate, not seasonally adjusted.
SOURCE: Investment Dealers Digest. Since the second half of 1983,
the Digest no longer makes its data on private placements publicly
available.
has tailed off in the past two years, and in vestable funds from sources such as annuities, pension funds, employee benefit plans, and new
insurance products have increased. The experience of previous years, however, has left portfolio managers at insurance companies with a
desire to maintain more liquid portfolios, and
they have tended to emphasize public bond issues, which are more readily resold in the secondary market. Also, the lower-quality issuers
that found the public market more receptive last
year might otherwise have sought to raise funds
in the private market.
An important change in the private placement
market recently has been a shift from longerterm to intermediate-term maturities. As in the
public market, this shift reflects in part the
perceived high level of real interest rates and the
volatility of rates in recent years. Another impor-
Recent Financing Activity of Nonfinancial Corporations
3. Gross bond issuance by U.S. firms
in foreign markets
Millions of dollars
Year or quarter
1977
1978
1979
1980
1981
1982
1983
1984:1'
All
corporations
1,128
1,116
2,868
4,104
6,180
13,632
8,340
17,472
Type of corporation
Nonfinancial |
Financial
n.a.
n.a.
n.a.
n.a.
n.a.
9,192
3,912
10,344
n.a.
n.a.
n.a.
n.a.
n.a.
4,440
4,428
7,128
1. Annual rate, not seasonally adjusted,
n.a. Not available.
tant factor in the private market has been a
change in the nature of the liabilities of life
insurance companies. Insurance companies now
receive a large amount of their investable funds
from annuity contracts and pension funds for
which they guarantee a fixed rate of return for
periods typically ranging from three to ten years.
The desire of insurance companies to match the
duration of their bond portfolios with that of their
guaranteed investment contracts has led them to
acquire more intermediate-term instruments.
Another change in corporate financing patterns has been the increased use of the offshore
market (table 3). Well-known firms have found
the Euromarket attractive because they frequently can issue intermediate-term debt (nearly
all Eurobond issues have maturities in the fiveyear to ten-year range) at lower interest rates
than in the domestic market. This disparity in
financing costs exists because the domestic and
Euromarkets are segmented: foreign investors
are discouraged from directly purchasing bonds
8. Movements in selected stock price indexes
Index
AMEX = American Stock Exchange; NASDAQ = National Association of Securities Dealers Automated Quotations; NYSE = New
York Stock Exchange. Each index is a monthly average, adjusted to
equal 100 in August 1982.
405
sold in the U.S. market because under current
laws their interest income would be subject to a
30 percent "withholding" tax; in addition, investors usually can achieve a greater degree of
anonymity in the Euromarket because bonds
generally are issued in bearer form.
Eurobond issuance by U.S. firms swelled in
1982, but volume diminished in 1983 as external
financing needs were small and companies preferred to issue the longer-maturity bonds that
could be sold readily only in the domestic market. As intermediate-term issues again became
common in early 1984, however, U.S. firms
returned to the Euromarket with an even greater
volume of offerings than in 1982.
Stock prices turned sharply upward in summer
1982: measured from the lows of August 1982 to
the peaks attained the following summer, the
major stock price indexes advanced 60 to 110
percent (chart 8 and table 4). These advances
mark the largest one-year increase in share
prices in the postwar period. Over this span, the
market value of common stock on the New York
and American exchanges and in the over-thecounter market increased about $700 billion.
4. Percentage change in stock prices 1
Index
DJIA2
NYSE composite
AMEX composite
NASDAQ composite
August
1982
to
June
1983
June
1983
to
January
1984
January
1984
to
April
1984
60.7
68.4
107.4
106.2
3.1
-1.3
-7.6
-12.3
-12.1
-8.6
-10.2
-16.0
1. Percent change from the peak or trough in the first month listed
to the peak or trough in the second month listed.
2. Dow Jones Industrial Average.
The desire to restructure balance sheets and
the strong performance of stock prices stimulated nonfinancial corporations to issue record
amounts of new equity shares (table 1). Even
after adjustment for inflation, late 1982 and 1983
represented the most active period on record for
new equity sales. Most of the stock issuance was
by corporations with stock already traded publicly, but the market for initial public offerings also
was extremely active: during 1983, an estimated
%1Vi billion of equity issuance represented firsttime stock sales by nonfinancial corporations,
406
Federal Reserve Bulletin • May 1984
more than twice the previous record volume in
1981. The increase in stock prices also had an
effect on the types of bonds sold. As previously
mentioned, the issuance of convertible bonds
and bonds with warrants was common during
1983.
Stock prices lost their upward momentum in
the second half of 1983, and although issuance
was still strong by historical standards, the volume of new equity began to slow. The major
stock price indexes fell about 10 percent in
January and February, and new stock sales by
nonfinancial firms in early 1984 were limited.
Furthermore, because large amounts of stock
were retired in merger transactions, net issuance
of equity shares in the first quarter of 1984 was
decidedly negative.
Increased bond issuance during late 1982 and
early 1983, combined with strong internal cash
flows and heavy stock issuance, allowed nonfinancial corporations to reduce their dependence
on loans and short-term market debt, which had
increased rapidly in the preceding years (table 1).
Business loans at commercial banks rose only
moderately from the fourth quarter of 1982
through the third quarter of 1983. In addition,
nonfinancial corporations paid down commercial
paper and bankers acceptances over the same
period. Borrowing at finance companies was
strong in 1983, but the major area of strength was
loans for commercial vehicles, which generally
have longer maturities than those on commercial
bank loans or commercial paper.
A substitution of longer-term debt and equity
for shorter-term debt typically has occurred in
the late stages of recession and the early part
of recovery. In the current cycle, however, the
period of restructuring was relatively short.
When interest rates rose in the second half of
1983—from what already were regarded by many
as very high real levels—business firms became
more reluctant to issue longer-term debt. Overall
bond volume slowed markedly, and there was
once again a tendency to move toward intermediate maturities (chart 7). In addition, the volume
of shorter-term borrowing by nonfinancial corporations surged in the fourth quarter, with substantial expansion in nearly all categories.
The emphasis on shorter-term financing continued in the first quarter of 1984. Bond issuance
in both the domestic and Euromarkets rose, but
most of this volume was accounted for by intermediate-term issues. Meanwhile, business loans
at commercial banks and finance companies and
the issuance of commercial paper by nonfinancial corporations increased sharply. A portion of
this shorter-term borrowing was undertaken to
finance mergers and acquisitions, but the pace
was strong even after allowance for this influence.
INNOVATION
IN CORPORATE
FINANCE
During the 1970s and early 1980s, many new
instruments and financing techniques came into
use as firms and investors endeavored to cope
with an increasingly uncertain economic and
financial climate—one marked in particular by
rapid inflation and high and volatile interest
rates. Perhaps the most basic technique used by
business firms was diversification of the liability
side of their balance sheets to avoid being subject
to constraints on the availability of funds and to
ensure access to the lowest-cost funds. The large
volume of funds raised in the Euromarket is one
indication of this trend. Moreover, many large
corporations have established finance subsidiaries. While these subsidiaries provide a broad
array of financial services, one of their most
important functions is to maintain a presence in
several credit markets and to channel funds to
the parent company. The rapid growth of both
commercial bank lines of credit and commercial
paper also suggests that corporations are concerned with immediate access to alternative
sources of credit. Since 1977, the volume of
unused loan commitments advanced to nonfinancial corporations has nearly tripled to about $350
billion. Similarly, in the mid-1970s only 500 nonfinancial corporations had access to the commercial paper market, and the volume of paper
outstanding was about $13 billion; in early 1984
about 800 nonfinancial firms had issued commercial paper, and the outstanding volume had increased to $50 billion. Many firms that have
started issuing commercial paper in recent years
ordinarily would not have credit ratings high
enough to tap this market; however, a letter of
credit from a commercial bank specifically backing their paper has given them access on attractive terms.
Another important source of funding used by
Recent Financing Activity of Nonfinancial Corporations
corporations in recent years is the tax-exempt
market. State and local governments, subject to
some constraints imposed by the federal government, can raise funds on behalf of corporations
to be employed for private purposes. This financing is allowed to support either small projects or
projects that will benefit the community, such as
the purchase of pollution control equipment or
the construction of airports and seaports. Corporate financing in this market grew steadily
throughout most of the 1970s and early 1980s so
that in recent years issuing bonds in the taxexempt market became a major source of funding
for nonfinancial corporations. Bond issuance by
businesses in this market slowed dramatically in
early 1984 because the tax-exempt status of such
bonds was jeopardized by bills in the Congress to
limit private purpose funding in the tax-exempt
market.
The development of alternative sources of
financing has led commercial banks to adjust the
pricing of commercial and industrial loans. Specifically, commercial banks found that they had
to offer loan terms that were more competitive
with those available from the commercial paper
market and foreign banks, another source of
funds developed by corporations. In previous
periods, commercial banks typically priced their
term business loans that carried floating rates at
spreads off the prime rate; in recent years, however, competitive pressures forced them to offer
loan agreements in which borrowers have the
ability to select (and switch) among pricing options that frequently include bases such as the
London interbank offered rate or the rate on
negotiable certificates of deposit. This flexibility
enables firms to manage their exposure to interest rate risk more actively, as well as potentially
to lower their borrowing costs. Below-prime
lending also has become common in recent years
for short-term loans, but such lending is usually
available only to larger customers—especially
those who have access to the commercial paper
market.
Along with developing new sources of funds,
nonfinancial corporations have adopted new
techniques to fund their expansion or to improve
the condition of their balance sheets. For instance, lease financing has become more common in recent years. Instead of borrowing to
finance expenditures, firms can lease capital
407
goods and make periodic rental payments rather
than interest payments on debt. Leasing frequently is attractive because it allows firms to
expand without showing larger amounts of debt
directly on their balance sheets (in most cases,
lease obligations are reported in the footnotes of
financial statements). Also, firms might lease
capital goods to avoid owning equipment that
may become obsolete. Finally, tax factors may
be involved. A firm with low tax bills would not
need to shelter income by utilizing the depreciation expenses and investment tax credits associated with the outright ownership of durable
goods.
The Financial Accounting Standards Board
and the Securities and Exchange Commission
recently approved another technique, known as
in-substance defeasance, that allows firms to
remove debt from their balance sheets. In these
transactions, a firm places in an irrevocable trust
essentially risk-free assets, such as cash or U.S.
government obligations, that generate sufficient
cash flow to service a portion of its debt. Because all principal and interest payments on the
debt will be made from the assets held in trust,
the firm can remove the debt and the assets from
its balance sheet. The firm also can book a
capital gain if older, low-coupon debt is removed
from the balance sheet. Treasury securities bearing current market yields would be capable of
servicing a larger volume of low-coupon debt,
and the firm could report as current income an
amount approximately equal to the difference
between the book values of the defeased debt
and the assets placed in trust. In effect, this boost
to income represents the present value of future
net income that would be earned if the asset and
debt remained on the balance sheet. Besides
increasing income reported in the current period,
these transactions will improve a firm's debt
ratios, although this improvement comes at the
expense of some decline in liquidity. Data are not
available on the amount of debt removed from
balance sheets through in-substance defeasance,
but market participants indicate that it has been
used frequently since its approval at the end of
1983.
Another innovation that has been used since
1982 is the "interest rate swap." With this type
of transaction, two firms issue debt under their
own names, the debt of one bearing a fixed
408
Federal Reserve Bulletin • May 1984
interest rate and that of the other a floating
interest rate; and then they exchange their interest rate obligations. This generally allows each of
the parties to service its preferred type of debt—
fixed rate or variable rate—at a lower interest
cost than either could obtain by issuing debt
individually. For these transactions to be beneficial to both parties, the issuers must have a
comparative advantage in a particular type of
debt or in a particular market. With each party
specializing in the market in which its relative
costs are lowest, the combined interest expense
will be minimized, and the overall cost savings
will be divided by the terms of the swap agreement. Multinational corporations have engaged
in similar transactions known as "currency
swaps." Rather than exchanging fixed-rate and
variable-rate interest obligations, these arrangements involve firms swapping interest obligations denominated in different currencies. Precise data are not available on the volume of
either type of transaction, but several reports
suggest that swapping activity has been widely
used.
Because interest rate swaps and currency
swaps allow corporations to service the type of
debt they prefer, these transactions probably
limit the exposure of the firms to risk associated
with changes in interest rates and exchange
rates. Another method corporations can use to
reduce their exposure to such risk is to hedge
with financial futures, options, and forward contracts. Interest rate futures are now traded in a
variety of maturities for several different instruments, and options are available on Treasury
securities as well as on Treasury futures. Similarly, futures and options in the major currencies
are traded actively. In recent years, several
commercial banks have begun to offer forward
interest rate contracts that allow their customers
to fix the rate on loans or deposits before the
actual date of the transaction. By utilizing these
instruments effectively, firms can reduce their
interest rate risk for periods of up to two years
and their exchange rate risk for periods of up to
one year.
Another important development that has assisted corporations in raising external funds involves the mechanics of issuing securities in the
public market. In 1978 the Securities and Exchange Commission began to streamline the
process of registering securities for sale so that
large, well-known corporations could market
securities more quickly. Initially, the changes
authorized by the commission involved abbreviated registration statements, disclosure of information by reference to other documents the firm
already had made public, and selective review of
documents by the SEC staff. With these changes
in force, issuers could have a registration statement approved in as short a time as two days;
before the changes, the registration process
might well consume several weeks.
In March 1982, the Securities and Exchange
Commission went a step further by authorizing a
technique known as shelf registration. Under this
system, larger corporations (those with outstanding stock exceeding $150 million in market value)
can register the full amount of debt or equity they
reasonably expect to sell over a two-year period.
After this initial registration, the firm can sell the
securities without further delay when funds are
needed or market conditions seem favorable.
Shelf registration is an important financing technique if market conditions are volatile because it
offers firms the flexibility to react quickly when
conditions become favorable. Shelf registration
also seems to reduce the costs of issuing securities because savings can be achieved on legal,
accounting, and printing expenses, and greater
competition among investment bankers may reduce underwriting fees.
Corporations quickly adopted the shelf registration technique in the bond market: 50 to 60
percent of all debt sales during the past two years
involved this technique (table 5). The data in the
table are aggregated over all corporations, but
disaggregated data would show that financial
firms have used the shelf technique for debt
securities somewhat more frequently than have
nonfinancial firms. Financial firms are accustomed to raising funds quickly in a variety of
markets, and shelf registration allows them access to the bond market in a manner similar to
that of alternative sources. In the equity market,
shelf registration accounts for less than 10 percent of total issuance. Some market analysts
have argued that new equity shares sitting on the
shelf tend to depress the current price of a firm's
stock because existing shares will trade on a fully
diluted basis as investors immediately discount
the effect of potential new equity sales. Also,
Recent Financing Activity of Nonfinancial Corporations
5. Bonds issued through shelf registration
Millions of dollars
Year and
quarter
Total gross
volume of
bonds issued
Bonds sold through shelf
registration
Dollar volume
Percent of total
1982:2 . . .
3...
4...
8,696
13,822
15,702
1,704
7,774
9,164
19.6
56.2
58.4
1983:1 . . .
2...
3 ...
4...
13,725
15,276
7,962
10,302
7,682
7,445
3,950
5,908
56.0
48.7
49.6
57.3
1984:1 . . .
14,265
8,392
58.8
many firms prefer that their stock sales be widely
distributed through a large syndicate of underwriters. Because sales of securities by shelf
registration frequently occur quickly through a
large investment bank, extensive syndicates typically are not assembled, and the securities are
not broadly distributed.
CORPORATE LIQUIDITY
CAPITALIZATION
AND
As measured by traditional yardsticks of financial strength that are applied to individual companies, the balance sheets of nonfinancial corporations as a whole have deteriorated over the
past decade: debt has had heavier emphasis than
equity, loans and short-term market debt have
played a larger role than long-term debt, and
liquid assets have declined relative to both total
assets and current liabilities. In part, this deterioration in key financial ratios reflects the toll
taken on the corporate sector by sluggish economic growth and poor corporate profits in the
late 1970s and early 1980s. However, the escalation of inflation over this period and the institutional changes already discussed probably altered the desired balance sheet position of
corporations as well as the standards of soundness applied by the market. Furthermore, the
traditional balance sheet indicators of corporate
well-being became increasingly questionable,
owing to the differences between book values
and market values of assets and liabilities as well
as to accounting practices that may not reflect
the economic well-being of a corporation.
Nevertheless, the problems that corporations
experienced in the late 1970s and early 1980s
409
attest to the seriousness of their financial deterioration. The number of bankruptcies soared in
1982, downgradings of corporate debt rose to
record levels, and unprecedented numbers of
firms reduced or omitted dividend payments.
The aggressive balance sheet restructuring that
was evident in late 1982 and early 1983 further
demonstrates that corporations were greatly concerned with their overall financial position. At
the same time, however, the abrupt slowdown in
bond issuance in the second half of 1983 and in
equity issuance in early 1984 indicates that corporations are willing to restructure only when
interest rates and price-earnings ratios are at
levels they find attractive. Moreover, the narrow
risk spreads and the market access of lowerrated firms suggest that the investment community is not especially uncomfortable with the
current situation.
Because of strong internal cash flows, nonfinancial corporations were able to use proceeds
of their long-term bond and equity financing in
late 1982 and 1983 to reduce their reliance on
shorter-term debt and to build liquid assets.
Reflecting this activity, the ratio of liquid assets
to short-term liabilities increased sharply during
1982 and 1983 (chart 9). Except for a brief period
in 1981, this ratio has declined continuously
since the end of 1976. Part of the decline in the
late 1970s probably is related to the greater
confidence firms have gained in their ability to
obtain credit to meet their immediate financing
needs. To the extent that nonfinancial corpora9. Selected balance sheet ratios of nonfinancial
corporations
Percent
1971
1975
1979
1983
Short-term debt includes commercial bank loans, commercial paper, bankers acceptances, finance company loans, and U.S. government loans. Liquid assets include currency, demand and time deposits, foreign deposits, security RPs, U.S. government securities, state
and local government obligations, and open market paper. Total
current liabilities include short-term debt, trade debt, and profits taxes
payable.
* = break in the series.
SOURCE. Federal Reserve flow of funds accounts, quarterly data,
seasonally adjusted annual rate.
410
Federal Reserve Bulletin • May 1984
tions have unused lines of credit and ready
access to the commercial paper market, the need
to hold liquid assets diminishes. However, the
brief increase in liquidity in 1981 and the strong
rebound in 1982 and 1983 suggest that corporations viewed their holdings of liquid assets as
deficient. The ratio of liquid assets to short-term
liabilities began to level off in the second half of
1983 and likely moved lower in the first quarter
of 1984.
The reduced dependence on loans and shortterm market debt in 1982 and 1983 also helped to
reduce the ratio of short-term debt to total debt;
however, the improvement was only moderate
and by the fourth quarter of 1983 this ratio was
again pushing upward (chart 9). This ratio and
the liquidity ratio already discussed are distorted
somewhat by measurement problems. Specifically, outstanding bonds are considered long-term
debt, even when they are maturing within the
next year or if their financing costs are uncertain
because they are variable-rate obligations. Similarly, all bank loans, including term loans, are
classified as short-term debt. Measurement problems aside, a strong trend has been evident in
this ratio since the early 1970s as the high level of
interest rates and the uncertainty about the future behavior of inflation and interest rates has
consistently caused firms to avoid long-term
debt. By shifting to shorter-term and variablerate sources of funds, however, corporations
have exposed their financing costs to the wide
fluctuations of the interest rate cycle. With the
volatility that has been evident in recent years,
financing costs and earnings have become more
cyclical.
The equity position of nonfinancial corporations deteriorated during the late 1970s and early
10. Ratio of stockholders' equity to total debt for
manufacturing firms
1973
1975
1977
1979
1981
1983
SOURCE. Quarterly Financial Report, U.S. Bureau of the Census.
1980s. New equity issuance was discouraged by
sagging stock prices, and retained earnings generally were low because of poor corporate profits. As a result, firms relied primarily on borrowings to meet their funding requirements, and the
ratio of equity to debt declined steadily from
1976 to mid-1982 (chart 10). Some decline in
observed ratios of equity to debt reflects distortions related to inflation; that is, existing assets
and liabilities continue to be valued at historical
cost on firms' balance sheets and do not reflect
market values. Management may perceive its
company's equity position as stronger than that
reported on the books if the value of assets has
increased with inflation and the real value of
long-term debt has depreciated. Also, firms have
real incentives to increase their leverage as
prices accelerate; in particular, the tax-sheltering
aspects of interest expenses are a more important factor as nominal interest rates rise with
inflation. Notwithstanding these considerations,
the equity position of nonfinancial corporations
declined considerably during the late 1970s. With
the record volume of new equity sales in 1982
and 1983 and the increase in retained earnings,
the ratio of equity to debt on a book-value basis
showed marked improvement. However, because of the low volume of new equity issuance
in the first quarter of 1984, the retirement of
stock associated with heavy merger activity, and
the pronounced pickup in short-term debt, the
ratio of equity to debt likely turned downward
once again.
The failure thus far of the key financial ratios
of nonfinancial corporations to return to the
levels of the mid-1970s reflects both an alteration
in the desired balance sheet position and only a
brief period of restructuring in 1982 and 1983.
While an appreciable drop in long-term interest
rates or a rally in the stock market likely would
stimulate further restructuring, financial managers and market participants in the aggregate
appear to be fairly content with the balance sheet
positions in the current environment. However,
as expanding economic activity increases the
needs of corporations for external financing, a
continuation of the recent reliance on borrowing—especially in the form of loans and shortterm market paper—could push firms into uncomfortable balance sheet postures.
•
411
Industrial Production
Released for publication
percent of the 1967 average, industrial output in
April was 6.0 percent above its previous peak
reached in July 1981.
In market groupings, production of consumer
goods advanced 1.1 percent in April, with durables up 0.4 percent and nondurables up 1.3
percent. Autos were assembled at an annual rate
of 7.7 million units, somewhat below recent sales
levels, and down from the rate of 8.2 million
May 15
Industrial production increased an estimated 1.4
percent in April following a rise of 0.5 percent in
March and larger increases in January and February. The April increase was the 17th consecutive monthly gain. Advances in output were
widespread among most products and materials,
with the exception of motor vehicles. At 163.1
1967=100
TOTAL INDEX
170
150
1967 =
170
Products ouput
X,—
^ i /
1
150
Materials ouput
-
130
1
FINAL PRODUCTS
190
Business equipment
— ^
\
_
N
100
1
1
i
i
130
1
MATERIALS
190
170
170
150
150
130
130
110
110
Consumer goods
Defense and space
90
CONSUMER GOODS
INTERMEDIATE PRODUCTS
Business supplies
190
170
Nondurable
150
\
r
N
Durable \
v
/
/
Construction supplies
V
^
/V /
—'
Annual rate, millions of units
1969-70=100
180
140
1978
1980
1982
1984
All series are seasonally adjusted and are plotted on a ratio scale.
1978
1980
1982
Auto sales and stocks include imports. Latest figures:
130
412
1967 = 100
1984
Grouping
Mar.
Percentage change from preceding month
1983
Apr.
Dec.
Apr.
Percentage
change,
Apr. 1983
to Apr.
1984
1984
Jan.
j
Feb.
Mar.
Major market groupings
Total industrial production
1.0
1.4
14.4
Products, total
Final products
Consumer goods
Durable
Nondurable
Business equipment .
Defense and space ..
Intermediate products .
Construction supplies
Materials
.5
.4
.4
.4
1.2
1.2
-.4
.3
.9
.9
.8
1.0
1.9
.4
.6
.4
1.3
1.3
1.7
1.4
1.5
1.4
12.9
12.5
9.4
16.7
6.7
19.4
12.3
14.3
18.3
16.6
.5
.7
.2
-.8
1.0
1.5
1.8
1.2
-.2
.2
15.2
19.6
10.2
10.5
5.6
.1
.2
.2
.5
.8
.5
1.1
1.1
Major industry groupings
Manufacturing
Durable
Nondurable
Mining
Utilities
162.4
151.7
177.8
123.5
178.3
164.9
154.4
179.9
123.3
178.7
.3
1.0
-.5
2.1
3.5
1.7
2.5
.7
.9
-.8
1.3
1.3
1.3
-.2
-2.4
NOTE. Indexes are seasonally adjusted.
units in March; these seasonally adjusted rates
take into account temporary plant closings in
connection with model changeovers. Output of
home goods as well as production of consumer
nondurable s gained sharply in April following
two months of little change. Production of equipment was up 1.5 percent, with sizable increases
in the manufacturing, commercial, and defense
equipment groups. There were sharp gains in
output of construction supplies throughout the
first quarter, and the brisk pace apparently continued in April.
Output of materials increased 1.4 percent in
April. Among durable materials, there were particularly strong gains in equipment parts and in
basic metals. Production of nondurable materials
also rose rapidly, but output of energy materials
rose only 0.3 percent.
In industry groupings, manufacturing output
gained 1.5 percent in April, with sharp increases
in both durable and nondurable industries. Output by utilities edged up, but mining output slid
0.2 percent, in part due to a decline in coal
production.
413
Statements to Congress
Statement by E. Gerald Corrigan,
President,
Federal Reserve Bank of Minneapolis, before the
Committee on Banking, Housing, and Urban
Affairs, U.S. Senate, April 11, 1984.
I am pleased to have this opportunity to review
developments over the past three years regarding
the priced services activities of the Federal Reserve Banks. My prepared statement is divided
into four parts: (1) an overview of the role of the
Federal Reserve in the provision of payments
services to depository institutions; (2) a general
review of our experience with the pricing of such
services as required by the Monetary Control
Act of 1980; (3) comments on the draft report on
such activities prepared by the General Accounting Office (GAO) at the request of members of
this committee; and (4) some brief remarks on
the subject of delayed availability of funds associated with some check deposits.
THE ROLE OF THE FEDERAL
RESERVE
IN THE PAYMENTS
MECHANISM
The operation of the nation's payments mechanism is a vast and complex undertaking that
daily—directly or indirectly—affects virtually
every citizen, every business, and every financial institution in this country and millions of
others abroad. For most of us, the act of making
or receiving payment is as routine as getting out
of bed in the morning. However, although literally hundreds of billions of dollars change hands
daily with such reliability and efficiency, we
should not take for granted the smooth workings
of the payments mechanism. The safe, efficient,
and trusted operation of the payments system is
clearly a matter of high public interest in the
United States and around the world. Indeed,
these very considerations relating to the safety
and efficiency of the payments mechanism were
a central element in the decision of the Congress
to create the Federal Reserve more than 70 years
ago.
Reflecting in part the legacy of 70 years experience, I believe there is virtually unanimous
agreement that the Federal Reserve, as the nation's central bank, has a natural and continuing
interest in the efficient and safe functioning of the
payments mechanism. In part, that natural interest arises from the fact that disruptions in the
payments mechanism—regardless of their origins—can threaten the safety and soundness of
financial institutions and financial markets and,
in the extreme, the smooth functioning of the
economy at large. However great those concerns
may have been 70 years ago, they take on even
greater importance in the context of today's
highly interdependent domestic and international
banking and financial markets.
The point should also be made that transaction
balances at depository institutions and the associated reserve balances held at the Fed are, at
one and the same time, the vehicle through
which most payments are made, the bedrock
upon which all other financial flows rest, and the
mechanism through which monetary policy is
conducted. This trilogy of unique functions is
one of the reasons why banks have, in effect, had
an exclusive franchise on the operation of the
payments mechanism, and it is one of the reasons why I believe that banks are special. That
trilogy points, in my judgment, to the imperatives of strong banks, strong financial markets,
and a strong and efficient clearing system.
To put it more pointedly, the payments system
demands the highest degree of public confidence.
It simply would not be possible to make hundreds of billions of dollars in payments daily if
public confidence in the certainty of payments
and the payments process were shaken or undermined. While perhaps not of the same order of
importance, the operation of the payments mechanism inevitably involves other public policy
considerations relating, for example, to the ease
and terms with which smaller economic entities
and more remotely located institutions and individuals have access to the payments system.
414
Federal Reserve Bulletin • May 1984
The question, therefore, is not whether the
central bank has a responsibility to promote the
safety and efficiency of the payments mechanism, but rather it is one of how that responsibility can most effectively be discharged. More
particularly, should the Fed seek to achieve
these public policy objectives by regulation
alone; should it act as a processor of last resort,
taking on only those functions that others are
unwilling to provide or unable to provide at
reasonable fees and conditions; or should it
maintain an operational presence in the payments mechanism along the broad lines that have
prevailed for the past 70 years? From my perspective, the dictates of public policy point
strongly in the direction of preserving the operational presence of the Fed in the payments
mechanism—recognizing, of course, that the exact configuration of that presence need not, and
probably will not, remain as it is today. In saying
this I should also stress that an operational
presence for the central bank along the general
lines of the Fed's current activities is by no
means unique among central banks in the industrialized countries of the world.
"The processor of last resort" concept is
deceptively appealing, but, in my judgment, it is
not workable. The Federal Reserve Banks could
not maintain the standby facilities, equipment,
and personnel that would be needed to function
on an on-again, off-again basis or to step into
those situations in which an adequate level of
payments services might not be available nationwide at reasonable costs and terms. Moreover,
even the simplest aspects of the payments mechanism require a continuity of expertise and working knowledge that would be very difficult to
maintain in such an environment. Even if feasible, the cost to the taxpayers would be high.
Therefore, assigning to the Fed a role as processor of last resort is simply not viable.
In my opinion the United States has—taking
account of the size of our economy and the size
of our country—the most efficient payments system in the world. That fact cannot be attributed
to technological superiority, and it surely cannot
be attributed to the presence of a neat and clean
banking and financial structure. While many
factors may be involved, I would suggest that the
side-by-side presence of the Federal Reserve and
the private banking system in the operation of
the payments mechanism has been one of the
primary factors that has permitted and encouraged the payments system in the United States to
achieve this lofty status.
One can speculate as to whether the result
would have been different had the historic role of
the Fed been confined to that of a regulator of the
payments system. That speculation—however
interesting—cannot alter 70 years experience nor
can it alter the fact of where we are today. Let
me cite a few examples that may help to illustrate
my point.
• Is it reasonable to conclude that the book
entry system for U.S. government securities
would have developed as quickly as it did—if at
all—if the Fed had been only a regulator rather
than a participant in the payments mechanism?
• Is it reasonable to assume that one or more
private entities could, or would even want to,
fully displace the Fed's funds transfer network?
• Is it reasonable to assume that, absent a
Federal Reserve operational presence, 99 percent of the checks written in this vast country
with its 40,000 depository institutions would be
collected in two days or less?
• On the other side of the coin, as late as 1979,
the Federal Reserve attempted, in the form of a
Board policy statement, to put a halt to delayed
disbursement of checks. However, we probably
have more delayed disbursement of checks today
than we did in 1979. The Federal Reserve—
through the so-called "high dollar group sort
program," which will be implemented on April
23 of this year, is now seeking to achieve through
its operations what it could not achieve through
"regulation."
The point, of course, is that the payments
mechanism is so complex, legally and operationally, that it is far from clear that public policy
objectives could be achieved simply by writing
regulations. Moreover, it is quite possible that
absent the "hands on" working knowledge
gained through operations, regulatory efforts
would quickly take on an ivory tower character
that would be ineffective, impair the efficiency of
the payments mechanism, or both. There is no
doubt in my mind that the Fed's operational
presence in the payments mechanism is a better
alternative than what otherwise would be a cumbersome and very costly regulatory apparatus.
While I am skeptical that regulation alone
Statements
could provide a cost-effective and efficient method of ensuring that the public policy objectives
associated with the operation of the payments
mechanism would be well served, there are other
aspects of the Fed's operational presence that
would be very difficult to duplicate if it were
simply a regulator of the payments system. For
example, the Fed can be thought of as something
of a neutral and trusted intermediary in the
payments process. Its only interest is bringing
together collectors and payors in the fastest and
safest manner possible. It has no particular interest in whether a check is large or small, whether
the collecting or paying institution is large or
small, or whether the writer of a check is an
otherwise valued customer. Indeed, the fact that
the Federal Reserve has no relationships with
bank customers that Eire not depository institutions is a feature that makes it an attractive
source of payments services for many depository
institutions.
This role as a trusted and neutral intermediary
is reinforced by the fact that the Fed is also the
bankers' bank whose solvency is never in question. This feature permits the Fed prudentially to
assume risks such as the intraday credit exposure on Fedwire or to act as a correspondent for
problem banks when others may be unable or
unwilling to accept such risks. In tandem, the
neutral intermediary and the ever-solvent bankers' bank are aspects of the Fed's role in the
payments mechanism that contribute, in no small
way, to that essentia] public confidence in the
payments system.
None of the above should be construed to
mean that the Fed's operational presence should
remain exactly the same as it is today. Technological developments, the advent of interstate
banking, the creative efforts of individual banks,
and a host of other factors, no doubt, will change
that role over time. Moreover, the Congress may
wish to provide different direction to the Federal
Reserve asking that we do more, that we do less,
or that we do nothing. At this juncture, however,
I personally would urge that we retain the legislative status quo.
The bottom line, as I see it, is that the financial
system, the business community, and the public
at large have been the clear beneficiaries of the
Fed's role—in partnership with the banking community—in promoting the highly efficient and
to Congress
415
safe payments system that we enjoy in the United States. Alternative configurations are easy to
conceive, but may not be so easy to operate in a
way that is appropriately sensitive to those public interest considerations I spoke of earlier.
Much of what I have said about the role of the
Federal Reserve is germane to one of the most
basic issues raised by the GAO draft report,
namely, whether there is a conflict of interest
between the Fed's role as a service provider and
as a regulator of the payments mechanism. I will
readily concede that there is a potential conflict
of interest between the Fed's role as a regulator
and as a provider of payments services in a
competitive environment. However, there are
powerful forces that seem to me to more than
adequately ensure that potential conflicts will
never become actual conflicts. These powerful
countervailing forces include the generalized
public scrutiny of Fed actions, the oversight and
general supervisory role of the Board of Governors, the public comment process, the activities
of the GAO, and the oversight by the Congress
itself.
Moreover, I think the point should be stressed
that removal of the Fed from an operational role
in the payments system will not eliminate potential conflicts of interest—it will in fact create or
intensify other potential sources of conflict. That
is, private suppliers of payments services legitimately look first to the interests of their customers and their shareholders in determining the
operational posture they will take in providing
such services. That is wholly appropriate, but at
times it may not yield results that are in the
public interest. The payments process is, inevitably, one that entails collisions of interests: payors want to slow it down; collectors want to
speed it up; large economic agents have more
clout and flexibility than do the small ones.
These potential conflicts are subtle and not easy
to detect or resolve. The potential conflicts associated with Fed activities—to the extent that
they are real—are highly visible and readily
subject to remedy if abuses were to develop.
Having said all of that, I should hasten to add
that there will always be situations in which
operational activities of the Federal Reserve
Banks impinge on "regulatory" considerations
and vice versa. Let me cite a few very contemporary examples:
416
Federal Reserve Bulletin • May 1984
• Just two weeks ago, the Federal Reserve
Board requested public comment on a wide
variety of possible measures for reducing risk in
the operation of large-dollar wire transfer systems, including Fedwire itself.
• Beginning on April 23, the Federal Reserve
will commence an operational program designed
to accelerate the collection of checks drawn on
certain institutions located outside Federal Reserve cities. In certain instances, the practice of
drawing checks on such institutions could undermine the efficiency of the check collection system, raise questions of equity, and, in the extreme, also raise questions of safety and
soundness.
• Later in this statement I will make reference
to a possible operational change by the Fed that
could provide a major step forward in coping
with the delayed availability problem on certain
check deposits.
In all of these areas, and in others I could
mention, we must very carefully weigh operational and policy considerations. In the final
analysis, our actions should have a powerful
public interest motivation. However, even when
the case for a particular action makes overwhelming sense on both operational and public
policy grounds some market participants may
object to our initiatives on the grounds that our
action may be harmful to them or to their customers. I do not think we can or should avoid
those problems, but I do believe that the system
of checks and balances I referred to earlier
provides more than adequate protection against
the misuse of regulatory power by the Federal
Reserve. Indeed, as I see it, those checks and
balances may be so tilted that there is the danger
of the Federal Reserve not doing things that
would serve the public interest simply to avoid
"rocking the boat."
EXPERIENCE WITH THE PRICING
PROVISION
OF THE MONETARY CONTROL
ACT
During 1983, the Federal Reserve essentially
completed the transition to pricing of its payments services to depository institutions as
called for in the Monetary Control Act of 1980
(MCA). Specifically, the act required that the
Federal Reserve begin by September 1981 to
price its payments services so that over the long
run fees would be established based upon the full
costs of providing such services, including the
costs of float, taxes, and capital the Federal
Reserve would incur if it were a private firm.
Within little more than two years of the date
that the MCA required the Federal Reserve to
commence pricing, the following has occurred:
• All payments services provided to depository
institutions have been priced and are now generating sufficient total revenues to cover the full
costs of providing such services, including the
costs of float, taxes, and capital the Fed would
incur if it were a private firm.
• Federal Reserve services have been opened
to all depository institutions regardless of size
and location.
• Operational improvements by the Federal
Reserve have dramatically reduced the daily
average amount of Federal Reserve check float
from $4.5 billion in 1980 to a daily average of $1.2
billion in the fourth quarter of 1983. Of the latter
amount, $500 million was recovered through "as
o f ' adjustments and explicit fees, and the cost of
$700 million in "residual" check float was added
to the cost base subject to recovery through per
item fees. A major thrust of the Federal Reserve's activities over the past two years was to
reduce float to the extent possible through operational improvements that added only modestly to
operating costs. This approach serves both equity and efficiency. If the value of all check float as
of 1982 and 1983 had simply been added—across
the board—to costs and prices, sizable incentives to increase float—particularly by the writers of large dollar checks—would have been
created and the costs of such float shifted to the
collection system generally, rather than being
borne by those who create and benefit from float.
The transition to the priced services environment was managed not only with a view toward
satisfying cost-recovery objectives, but also with
a view toward seeking to enhance and improve
the efficiency of the payments mechanism. The
goal of greater efficiency was served in a number
of important respects including, but not limited
to, the following:
• Federal Reserve pricing served as a further
catalyst for moving in the direction of electronic
payments.
• Federal Reserve pricing spurred the reemer-
Statements
gence of local clearing arrangements among private depositories. This tended to remove one
step in the processing cycle for many local
checks, thereby resulting in faster and cheaper
clearing services.
• Changed deposit deadlines, processing cycles, and presentment times at many Federal
Reserve offices permitted the shift of checks
valued at about $2 billion per day from two-day
collection to one-day collection.
• It would appear that the amount of society's
real resources devoted to the payments mechanism has declined.
• The Federal Reserve has deployed almost
3,000 low-cost terminals in small- and mediumsized depository institutions, thus providing
these institutions with convenient and inexpensive access to a wide range of payments and
related services.
These achievements and the rapid transition to
a "profitable" base of operations did not come
easily. Indeed, I believe it is entirely fair to
suggest that the transition to the priced services
environment was more difficult and complex—
and more contentious—than most of us anticipated at the time the MCA was enacted. Speaking
for myself, I think I can also say that if I had to
do it over again, there are some things I would
have done differently. On balance, however, I
believe that the net effect of Fed pricing has been
good for the Fed, good for the banking industry,
and good for the public at large.
I also believe that with the difficult initial
transition to pricing now largely behind us, we in
the Federal Reserve are better positioned to turn
our attention to the more important questions of
what we can do—in cooperation with the banking industry—to foster still further improvements
in the efficiency, safety, and integrity of the
payments mechanism. These issues loom all the
more important in the face of the financial interdependencies that are now such a prominent
feature of contemporary financial institutions
and markets.
THE
GAO
CLEARING
REPORT
ON FED
CHECK-
to Congress
417
prehensive draft report regarding the pricing of
Federal Reserve check-clearing services. The
draft report covers a wide range of issues raised
by members of the committee and still others
raised by a few commercial banks. The committee, I believe, is also aware that the Federal
Reserve engaged the services of a major accounting firm to take an even more detailed look at
other aspects of our priced service activities.
That report is a couple of months away from
completion, and we will submit the conclusions
of the report for the record at that time.
Based on my reading of the GAO report, it
seems to me that steps already taken by the
Federal Reserve respond to most of the report's
major suggestions or recommendations. We will,
of course, submit a detailed response to the
overall GAO report. There are, however, several
areas in which I would offer some further comments at this time.
• First, we fully agree with the need for more
and better disclosure on the part of the Federal
Reserve regarding its priced services activities.
Toward that end, we have recently issued a
"Report on Priced Service Activities for 1983"
and contemplate that a similar report—augmented by abbreviated quarterly reports—will be
prepared annually.1
• Second, the GAO report strikes me as somewhat cautious on the question of presentment
fees and on the specific question of whether—in
some situations—the Federal Reserve should be
required to pay presentment fees. This is an area
in which I have very strong views. I believe it
would be a mistake to subject the Federal Reserve to presentment fees. If there is a case for
legislative action regarding presentment fees, I
would argue that such fees should be banned
altogether for any check presented to a payor
institution in advance of the 2:00 p.m. cut-off
hour established in the Uniform Commercial
Code.
• Third, the GAO suggests several areas in
which our internal procedures for allocating certain overhead costs to specific priced services
might be improved. We are looking closely at
these suggestions and at others made by our own
ACTIVITIES
At the request of members of this committee, the
General Accounting Office has prepared a com
1. The attachments to this statement are available on
request from Publications Services, Board of Governors of
the Federal Reserve System, Washington, D.C. 20551.
418
Federal Reserve Bulletin • May 1984
staff and by our accounting firm. Some changes
in these procedures have already been made and
others will be made, but—like the GAO—I do
not believe such changes will have a material
effect on costs or prices.
While these and other issues raised in the GAO
report are important, there are two questions
raised in the chapter of the report on "Competitive Issues" that I believe are central. The first is
the question of how to assure that the Federal
Reserve—with its central bank status and ability
to influence the market it serves—continues to
exercise its authority responsibly. I spoke to that
issue earlier. The second of these central questions is what response the Federal Reserve
should make if it becomes clear that the price the
market will ultimately be willing to pay for a
service the Federal Reserve provides is less than
what the Federal Reserve must charge to recover
its full costs. That question comes down to what
should the Fed do if it cannot cover its costs in a
particular operation? In one sense, the answer to
that question is very easy, but in another sense it
is very difficult. Not every service we provide or
might provide has the same degree of public
interest considerations associated with it. For
example, in considering the efficiency, safety,
and integrity of the payments mechanism, nobody would seriously argue that there are great
public policy considerations associated with coin
wrapping. At the other extreme, I think most
everyone would readily concede that there are
significant public policy considerations associated with the electronic transfer of reserve balances and securities by the Federal Reserve.
Given these differences in the public interest
content of our various services, our response to
the question can, in some instances, be rather
straightforward. Absent some strong public purpose, a failure to cover costs in a particular
service area must lead to the discontinuation of
the service in question by the Federal Reserve.
Indeed, we may have to face that very situation
with respect to certain of our safekeeping operations for paper securities. In those circumstances, we are quite prepared to discontinue
particular operations, but in the process we will
have to face some very difficult questions of how
and with what speed such services are phased
out.
In the case of a service that does not cover
costs but is perceived to have a clear public
purpose, it seems to me that we would have no
choice but to consult with the Congress. In the
near term, I do not see that situation arising, but
over time it certainly could, particularly in the
face of the sweeping changes in the structure of
our financial system that are almost certain to
occur over the next several years. Indeed, the
potential for that situation arising is even greater
in a context in which we perceive a strong and
continuing interest on the part of the Congress in
ensuring that an adequate level of payments
services are made available to all institutions
regardless of their size and location.
There is one other point implied by the GAO
report that is relevant to the preceding discussion
and warrants a few words. We in the Federal
Reserve need to articulate a clear statement of
our future role in the operation of the payments
system in a priced environment. It was not
possible to develop a statement of this nature
until the initial transition to pricing had been
accomplished. Now that the transition is behind
us, we are well positioned to proceed with that
task, and I would hope that such a statement
would be adopted by the Federal Reserve Board
by midyear.
DELAYED
AVAILABILITY
I am keenly aware that there is acute interest in
this committee and elsewhere in the Congress in
finding ways to stop the practice of excessive
delays by some depository institutions in passing
credit to their customers on some check deposits. Allow me, therefore, to close with a few brief
comments on this subject. My comments are as
follows:
• First, the incidence of abuse in delaying customer availability on check deposits varies considerably from market to market—and from institution to institution—and unfortunately in some
cases is far too lengthy.
• Second, efforts by some states and by depository institutions and their trade associations,
interest on the part of the Congress, and the
recently issued policy statement of federal financial institutions regulators represent constructive
steps in dealing with the problem.
• Third, I have reservations about efforts to
legislate availability schedules in part because
Statements
there is a danger, however remote, that such
legislated schedules could have the perverse
effect of encouraging banks that do not delay
availability to do so and in part because I believe
our objectives should be more ambitious than
current procedures and technology would permit. For example, under recently adopted state
regulations and as contemplated in some versions of proposed federal legislation, delays in
availability on some checks of up to eight days
are authorized. I believe we can do much better
and would not, therefore, want to institutionalize
delays of that duration.
• Fourth, in a context in which we are willing to
provide some reasonable time for voluntary initiatives to take hold, the Federal Reserve is
actively considering a phased-in approach to a
universal system of wire or telephonic advice of
large dollar return items. With such a system in
place, the case for a depository institution delaying funds availability on all checks to protect
against the risk of loss on the tiny fraction of
items that are returned would be greatly diminished, particularly as the dollar cutoff for wire
advice is reduced over time. This is a good
example of how advancing technology can work
to produce better results than might be gained
through legislatively imposed availability schedules that—to some extent—are captive to current
procedures and techniques.
While these steps can help solve or minimize
the delayed availability problem, the only solu-
Statement by Anthony M. Solomon,
President,
Federal Reserve Bank of New York, before the
Subcommittee
on International Finance and
Monetary Policy of the Committee on Banking,
Housing, and Urban Affairs, U.S.
Senate,
May 3, 19841
I welcome this opportunity to testify, on behalf
of the Federal Reserve System, about the recently announced financial package to help Argentina
meet interest payments on its bank debt. I think
1. Mr. Solomon presented similar testimony before the
Subcommittee on International Trade, Investment and Monetary Policy of the Committee on Banking, Finance and Urban
Affairs, U.S. House of Representatives, May 1, 1984.
to Congress
419
tion to the practice—and to the larger problems
associated with the mountains of paper payments
made daily—is to continue to accelerate the
move toward electronic payments. I said earlier
that I believe that one of the benefits of the MCA
was that it helped reduce some of the barriers to
the more widespread use of electronics in banking for consumers and businesses alike. The
technology is certainly there, and our younger
people—to say nothing of our school-age children—are less intimidated by computer terminals than are many of us. Similarly, the relative
costs of paper versus electronic payments continue to shift in a direction that is favorable to
electronics. Yet, the current paper-based system
provides real or perceived advantages to many—
advantages that in substantial ways grow out of
the inefficiences of the paper-based system, including the substantial amounts of non-FederalReserve float associated with its operations.
Thus, seizing the opportunities associated with
electronic payments will require a dual effort
pushing the efficiency of the paper system to its
limit while at the same time developing and
exploiting the benefits of electronics.
We in the Federal Reserve are strongly committed to those efforts and to the larger goal of
promoting the safety and efficiency of the payments mechanism. We look forward to working
closely with the banking industry and with others
in the furtherance of that goal.
•
these hearings can be helpful in setting the record
straight and in clearing up any misunderstandings that may have arisen about the Federal
Reserve's role in these arrangements.
Assistant Secretary Mulford has outlined the
main features of the package and has described
the events leading up to the agreement on that
package. I will comment on the role of the
Federal Reserve and respond to some questions
that have been raised about the significance of
this agreement.
Let me make clear at the outset that there was
no Federal Reserve money and no Federal Reserve guarantee in any way involved in the
arrangement. The Federal Reserve participated
as agent, and only as agent, through the Federal
420
Federal Reserve Bulletin • May 1984
Reserve Bank of New York, at the request of the
other parties to the agreement.
In this capacity, the Federal Reserve had no
financial interest in the transaction, but received
and held the money that was being provided by
the other parties, and, at the proper moment,
transferred that money to an agent bank that
made the payments to meet Argentina's overdue
interest obligations.
The New York Federal Reserve routinely acts
as an intermediary in transactions at the request
of other central banks, just as they sometimes act
for us, and in that sense this transaction was not
extraordinary. In the normal course of business
we regularly receive and hold funds for other
central banks, generally funds that represent the
dollar reserves of these nations. At the owners'
instruction, we invest these funds, largely in
U.S. government securities, or disburse them.
As agent for the Argentine financing package,
the New York Federal Reserve set up an escrow
account on its books. On March 30 we received
deposits of $500 million into the escrow account,
representing $100 million from the government of
Argentina, $100 million from the eleven commercial banks on the working committee for Argentina, and $300 million from the monetary authorities of Mexico, Venezuela, Brazil, and
Colombia. We also received from the Managing
Director of the International Monetary Fund a
progress report stating that constructive discussions had taken place with the Argentine government on Argentina's recent economic policies
and the main elements of a program of economic
stabilization that would provide the basis for
IMF support. With the full $500 million on deposit and with this progress report, we transferred the $500 million to the agent bank in New
York, which in turn disbursed funds to banks
around the world to meet Argentina's overdue
interest obligations.
There was one additional way in which the
New York Fed played an operational role. As
part of the arrangement, the Argentine government agreed to repay the eleven commercial
banks in the lending group $100 million upon the
completion of pending lending arrangements
with a large syndicate of banks. If those lending
arrangements are not completed by June 30, the
Argentine government has agreed to repay the
eleven banks from Argentine deposits held at the
New York Reserve Bank. The Argentineans
transmitted instructions to the New York Fed to
give effect to that understanding. We in turn
informed the eleven banks that procedures reflecting Argentine obligations to repay the $100
million loan had been completed. In general, in
the course of the discussions leading up to the
agreement and the Federal Reserve's operational
role, we were, naturally, in close touch with
Treasury officials, some commercial banks, and
interested foreign central banks.
It should be clear that, by participating in this
arrangement, the New York Federal Reserve has
not backed or guaranteed payment to the commercial banks with its own funds, and no party
has any claim against the Federal Reserve. I
repeat this because some of the press reports
may have conveyed a different impression.
Your letter inviting the Federal Reserve to
testify asked that we comment on its significance
with respect to several matters, including the
ongoing process of managing the Latin American
debt problem, the stability and soundness of
financial markets and the banking system, and
Argentina's negotiations with the IMF and with
the banks.
My own assessment is that the agreement on
the financial package constituted a very positive
and constructive move of benefit to all the parties. The U.S. participation is consistent with
earlier actions taken, for example, with respect
to Mexico and Brazil supporting their adoption
of IMF adjustment programs. I think this action
has substantially improved the prospects for
working out Argentina's debt problem and domestic economic difficulties on a satisfactory
basis. As a first step, that process inevitably
requires a rescheduling of maturing debt obligations along with a new money package, both
linked directly to a new IMF-supported adjustment program. The short-term financial package
that we are discussing today provided both valuable time and positive momentum for that approach. But the package itself does not assure a
satisfactory resolution of the Argentine problem,
much less resolve the broader debt issues of
Latin America as a whole.
Perhaps it would help if I sketched in a bit of
the background of Argentina's debt problem.
Argentina's difficulties in servicing its debt began
to emerge even before the time of the Falklands
Statements
war, when its economy was experiencing large
capital outflows, domestic recession, and rapidly
accelerating inflation. Early in 1983, agreement
was reached on an IMF-supported adjustment
program, and progress was made on clearing up
arrears and on rescheduling the debt. But later in
1983, during the final months of the military
government, wage policy slipped badly, inflation
rates soared, and interest arrears on the external
debt began once again to build up rapidly.
The newly elected Alfonsin government set
forth the main themes of its approach to the debt
problem soon after it took office in December. It
made clear that it wanted to reach agreement
with the IMF on a new adjustment program—
while emphasizing its intention to make the adjustments its economy needed largely through
major reductions in government expenditures
and in the size of the budget deficit, but without
further recession or cuts in real wages. The new
government also stated that it wanted to work
out rescheduling agreements with banks and
other creditors—but warned that it would press
for better terms than had been negotiated by the
previous military government.
While discussions continued with the IMF and
with the creditor banks, Argentina's interest
arrears accumulated, particularly to bank creditors. For U.S. banks, interest in arrears for more
than 90 days has particular significance. Under
the reporting requirements used by our federal
bank supervisory agencies, as well as those used
in certain states including New York, banks
generally can continue to accrue interest as income once it is past due and unpaid for only up to
90 days. Thus, once interest is unpaid for more
than 90 days, under current practice, U.S. banks
would generally have to stop reporting that interest as income in quarterly reports filed with bank
supervisors. They would, in most cases, also
reverse previous accruals and take that unpaid
interest out of income or reserves. Since U.S.
banks must publish their balance sheets on a
quarterly basis—March 31, June 30, and so on—
the March 31 date was significant. Let me state
that this was particularly, if not uniquely, significant for U.S. banks, given our system of comprehensive public quarterly reporting, which has no
parallel in the other major industrial countries.
I think that most U.S. banks had more or less
assumed that Argentina's interest arrears in ex
to Congress
421
cess of 90 days would not be cleared up by
March 31. They had accepted the fact that accruals of interest income on many Argentine public
sector loans would stop, and that prior accruals
would be reversed as of that date. Nonetheless, I
think that there was genuine concern among all
parties, including Argentina as well as others,
that such a development entailed substantial
risks. Clearly there would have been an appearance that the situation was eroding and that
positions might harden on all sides. Should that
situation have developed, there were several
concerns. For one, the domestic financial situation in Argentina could have deteriorated further
from capital outflows and other financial pressures. Also, the prospects of rescheduling Argentina's debt on acceptable terms, and in the
framework of a new IMF program, would diminish, with possible adverse spillover effects for the
debt problem more broadly.
Argentina would have been the first major
Latin American borrower in recent times to shift
into nonaccrual status on its sovereign debt. It is
not clear what might have been the reaction,
either of creditors—who might be troubled about
the precedent for other debt situations—or of
Argentina as well as of other debtors. Certainly it
would have been much more difficult to arrange
new bank financing for Argentina in the future—
even with an IMF program—if Argentine loans
had shifted to nonaccrual status. And it might
have made refinancings more difficult for other
sovereign debtors as well. It was against this
background that the Mexicans took the initiative
to propose a new financial package. Both the
Argentineans and the creditors quickly saw the
advantages of that approach.
The Argentine package in no way represented
a "bank bailout" with taxpayers' money. U.S.
government financing, through the Treasury's
Exchange Stabilization Fund (ESF), is to be
available, on a temporary basis, for one essential
purpose—to encourage agreement between Argentina and the IMF on an adjustment program.
This encouragement is in close conformance
with U.S. law, which calls for the ESF to be used
to support U.S. objectives in the IMF, and with
past practice, since similar bridging loans have
played an essential role in the adjustment efforts,
for example, of Mexico and Brazil. It is very
likely that a new IMF-supported adjustment pro-
422
Federal Reserve Bulletin • May 1984
gram, which this package is designed to encourage, will call for additional financing from the
commercial banks. Moreover, I am certain that
within the framework of an IMF program, every
effort will be made, in accordance with that same
U.S. legislative provision, to arrange a rescheduling of debt that is "consistent with safe and
sound banking practices and the [borrowing]
country's ability to pay."
Your letter asked whether current growth and
interest rate projections provide reason for optimism that the debt crisis is soluble. The outlook
for recovery and expansion in the industrial
countries is encouraging, with growth at about
3 ¥2 percent this year and next—which means that
less developed countries' exports could grow 5
to 7 percent and commodity prices should continue to move up. This growth would certainly
help debtors, but not enough to resolve their
problems.
Increases in interest rates are, of course, particularly burdensome to heavily indebted nations—a rise of 1 percent worldwide adds $3Vi
billion or more to debt-servicing costs of non-oil
developing countries after a full year. That figure
lends stark emphasis to the need for urgent and
decisive action on our budget deficit, certainly
the single most effective means of countering the
problem of high interest costs. In addition, those
involved in debt negotiations might want to consider techniques of limiting, by some kind of cap
on interest rates, the potential problems for the
successful implementation of IMF-supported adjustment programs that might result if there were
further increases in interest rates.
I do not think that failure to arrange the
Argentine package, with resulting nonpayment
of interest, would, by itself, have had a significant adverse impact on the safety and soundness
of the U.S. banking system. I have attached to
my statement a table that summarizes the information presented publicly by several of the largest U.S. banks in their first-quarter financial
statements regarding the effect of the package on
their quarterly earnings. 2 As those data certainly
suggest, the soundness of the banking system
was not endangered. That is not to suggest that in
some cases the potential effect was not significant, particularly if arrears had continued to
build up for an extended period; but in all cases
the immediate impact was, in my opinion, quite
manageable. Nor do I think concern over the
immediate impact on the stability of financial
markets was the most important aspect of this
matter—there is nothing to suggest that the prospect of nonpayment was not largely, if not entirely, discounted by financial markets. Rather, I
think the Argentine package was prompted by a
shared objective to improve the prospects for
agreement on an IMF adjustment program, and
as a basis for a more workable and acceptable
rescheduling of the Argentine debt. Let me cite
some key, closely related advantages.
First, it demonstrated to the new Argentine
government both that there was a willingness on
all sides to help deal with Argentina's severe
debt and economic problems and that there was a
strong international interest—including interest
among other Latin American borrowers—in seeing Argentina move promptly to formulate an
effective economic program and to reach agreement with the IMF.
Second, it brought together five key Latin
American governments—Argentina and the four
lending countries—under the umbrella of a Latin
American initiative, to cooperate in finding ways
to meet their debt obligations. This should help
defuse some of the North-South rhetoric on a
problem that will require cooperation, not confrontation to resolve successfully.
Third, in my judgment, it brought Argentina
and the IMF closer toward agreement on an
adjustment program and strengthened the incentives to reach final agreement on an IMF program in order that the Latin American creditor
governments can be repaid promptly.
Some say the result was only to buy time. But
the Argentine package does more—not only is
there now more time, but there is also an improved environment for coming to grips with the
outstanding issues between Argentina and the
IMF and between Argentina and the creditor
banks. Yet, unquestionably some formidable issues still remain to be negotiated.
2. The attachments to this statement are available on
request from Publications Services, Board of Governors of
the Federal Reserve System, Washington, D.C. 20551.
Argentina is, of course, just one of a number of
nations in Latin America and elsewhere that
have encountered serious debt problems. These
problems have to be viewed not as a single
Statements
to Congress
423
problem but as thirty or more individual problems, each with its own unique characteristics
and with its own political and economic setting.
Yet they do all have common features, and
success—or failure—in one country, particularly
a large one, can breed success—or failure—in
others. Thus, in my judgment, if success can be
achieved in dealing with the Argentine debt
problem, that success will to some extent spill
over and encourage success elsewhere. Similarly, demonstrated progress in dealing with the
debt problems of other countries will improve
the environment for Argentina.
•
Statement by J. Charles Partee, Member, Board
of Governors of the Federal Reserve
System,
before the Commerce, Consumer, and Monetary
Affairs Subcommittee of the Committee on Government Operations, U.S. House of Representatives, May 3, 1984.
authorities and provide assistance as requested
by those authorities.
The Federal Reserve System has primary supervisory authority at the federal level for about
1,000 state member banks and for more than
5,000 bank holding companies. The System fulfills its supervisory responsibilities primarily
through the conduct of periodic on-site examinations during which examiners evaluate, among
other things, the quality of a bank's loans and
investments, liquidity, capital adequacy, and
general financial condition. Examiners also review the activities of a banking organization's
management and directors; the adequacy of internal systems and controls; any material transactions with officers, directors, or principal
shareholders; and compliance with a wide variety of laws and regulations affecting a bank's
relations with insiders, depositors, borrowers,
investors, and the bank's general community.
The process is designed to determine that the
bank is being operated in a sound and prudent
manner in compliance with banking laws and
regulations.
In carrying out its responsibilities for nonproblem state member banks, the Federal Reserve
often relies on examinations conducted in alternate years by state banking authorities. With
regard to bank subsidiaries of bank holding companies, the Federal Reserve utilizes examination
reports prepared by the primary supervisor of
the bank subsidiary. These procedures are intended to reduce the burden associated with
overlapping regulatory authority and to strengthen the dual banking system and further cooperation between federal and state banking agencies.
I am glad to appear before this subcommittee to
discuss the role of the banking agencies in the
identification of violations of criminal law by
bank insiders and in the protection of commercial banks from the effects of illegal or improper
activities of insiders. My testimony will address
the general supervisory responsibilities and activities of the Federal Reserve with respect to
criminal misconduct and insider abuse. Detailed
answers to the specific questions raised in Chairman Barnard's letter of April 5 are contained in a
separate Federal Reserve staff report submitted
to the subcommittee.
We at the Federal Reserve share the subcommittee's concern over the need to detect in a
timely manner potentially improper insider activity and to take effective action to stop the activity
and to protect the banking institution. Prompt
and effective action is critical for two reasons.
First, as a matter of public policy, it is essential
in banking, as in all other endeavors, to ensure a
continuing high level of compliance with laws
and regulations. Second, criminal misconduct
and other forms of questionable or unsound
activities by bank insiders historically have been
major factors contributing to bank problems and
failures. For these reasons, when violations of
sound banking practices or laws and regulations
are discovered, it is our firm policy to take action
to halt such activities and to protect the banking
institution from their effects. Although the Federal Reserve has no authority for criminal prosecutions, we do refer possible criminal violations
that are uncovered by examiners to appropriate
In considering supervisory responses to bank
problems, it is important, I believe, to clarify the
meaning of the terms "criminal misconduct" and
"insider abuse." Criminal misconduct refers to
424
Federal Reserve Bulletin • May 1984
violations or possible violations of criminal statutes. The term "insider abuse" covers a wider
range of activities on the part of the bank's
principals that can have harmful consequences
for the bank, possibly at the same time benefiting
the insider or his or her related interests. Thus,
insider abuse may include improper lending practices such as the extension of unsound, excessive, or privileged loans to insiders or their
related interests, as well as possible violations of
criminal statutes such as fraud or misapplication
of bank funds. Indeed, some criminal activities,
such as theft or embezzlement, may not be the
fault of the bank's principal insiders. While insider abuse includes criminal misconduct, the term
also comprises other actions or practices that
may be equally or more harmful to a bank's
overall condition, such as violations of insider
lending limits or excessive loan concentrations.
Since all types of improper insider activities
can have an adverse effect on a bank's condition,
undermine public confidence in banking organizations generally, and contribute to a bank's
failure, all such activities are cause for serious
supervisory concern and require a prompt and
effective supervisory response. Examiners are
instructed to identify apparent violations of
banking statutes or unsound practices that are
having an adverse impact on the bank, and
supervisory authorities are responsible for formulating enforcement programs, including cease
and desist action or removal proceedings, to
enforce banking laws, protect the bank's condition, and promote the safety of depositors'
funds. Examiners also refer situations involving
possible criminal violations to law enforcement
authorities and cooperate in the gathering of
additional information. But it is important to
recognize that there is no foolproof way to
ensure that banks will not be adversely affected
by improper activities of insiders, particularly
when such transactions involve the commission
and concealment of criminal acts.
One obstacle that can hinder the early detection of possible criminal activity by senior bank
officials derives from the manner in which such
activity initially begins to surface. Some forms of
criminal activity in banks, such as embezzlement
and teller theft, often come to light abruptly and
usually result in the immediate termination of
employment and legal action against the individ
ual involved. Often—though not always—such
acts are committed by less senior bank employees and frequently do not involve amounts that
have a major impact on the bank's financial
condition.
As a practical matter, however, criminal violations that have had a materially adverse effect on
a bank's financial condition and that have involved senior officials usually surface in the first
instance in the form of inadequately documented
loans, incomplete credit information concerning
borrowers, and other forms of incomplete recordkeeping. Such forms of inadequate recordkeeping, while not widespread, are not uncommon in banks, and almost always are the result of
lax procedures rather than criminal misconduct.
Thus, in the vast majority of such cases, lax
procedures are addressed by examiners and effectively remedied through the supervisory follow-up process, including, when appropriate,
formal civil enforcement action. In those few
cases in which further digging indicates that
criminal activities may be involved, extensive
criminal investigations and prosecutions—lasting
in some cases for years—are often necessary to
prove the violations.
It should be emphasized that it is not our
policy to wait until the criminal investigation has
run its course before taking action to protect the
institution. In those instances when evidence
suggests that improper activities could harm the
institution or the public, the Federal Reserve
takes prompt action to stop those activities and
to prevent their recurrence. In most situations,
bringing the matter to the attention of the institution's board of directors is sufficient; they normally are quick to correct the situation or to
replace the individuals who were responsible. In
those few cases when the directors do not act—
often when the individual involved in misconduct
is also a control-owner—there are a number of
enforcement mechanisms available to the regulatory agencies. These include cease and desist
authority, the assessment of civil money penalties, and the suspension and removal of an officer
or director.
Over the last several years, the effects of
economic recession and the accompanying financial pressures on borrowers have contributed to
an increase in bank failures. Severe economic
difficulties can undermine the financial condition
Statements
of both sound banks and those in an already
weakened condition. However, banks with poor
management and imprudent lending policies, or
those weakened by questionable insider activities, are often more vulnerable to adverse financial developments. In addition, deteriorating
conditions may tend to encourage the relatively
small number of banks that are poorly managed
or inclined to insider abuse, self-dealing, or excessive risktaking to undertake greater risks or
questionable insider activities to offset the effect
of poor operating results.
It is the policy of the Federal Reserve to
ensure that circumstances suggesting a possible
violation of a criminal statute are referred to the
appropriate law enforcement authority. Our procedures concerning criminal referrals were
worked out in conjunction with the other banking
agencies and in consultation with federal law
enforcement authorities. Whenever examiners
uncover evidence or information suggesting the
possible violation of a criminal law, a determination is made as to whether or not the bank itself
has properly referred the violation. We have
found that, in the vast majority of cases, the
banks themselves do make timely referrals and
take action to remedy the situation, usually by
terminating the employment of the individual
involved. However, if the bank does not report
the violation, or if it appears advisable for any
other reason, examiners will refer the situation
directly to the local office of the U.S. Attorney.
In such situations, examiners gather as much
information as is reasonable in light of the individual circumstances and as is necessary to
determine the effect of the incident on the bank.
The judicial and procedural considerations
pertaining to criminal investigations and prosecutions are different in many respects from
considerations of safety and soundness and require specialized expertise. Nonetheless, the
banking agencies have participated in special
investigations conducted under the direction of
the law enforcement agencies and have assisted
the enforcement agencies in preparing cases by
providing expertise in banking matters. Decisions on whether or not to indict or seek additional information are made by the primary law
enforcement authorities. Generally, the Federal
Reserve is not involved in the process of indictment or prosecution, although System examiners
to Congress
425
do sometimes provide expert testimony in criminal cases.
As I have stated, the Federal Reserve takes
supervisory action against any unsound or questionable insider activity or bank practice, regardless of whether the activity or practice involves a
possible criminal violation. The Federal Reserve
completed 30 formal enforcement actions in 1982
and 50 such actions in 1983 involving state member banks or bank holding companies. A summary of these actions is enclosed with the Federal
Reserve staff report that has been submitted to
the subcommittee. In the first quarter of 1984,
the Federal Reserve completed 22 formal enforcement actions. In addition, the Board recently issued a notice of removal and suspension
against an officer and director of a bank holding
company for excessive and unsound insider
loans and violations of banking law. In this case,
the staff is presently negotiating the provisions of
a permanent prohibition agreement with the individual. Over time, it has been our experience
that the actual or planned initiation of removal
and suspension proceedings usually results in
resignations of the individuals cited, thereby
obviating the need to complete the removal action.
The subcommittee's letter appears to raise the
question of whether there is a need for some
form of monitoring system to prevent "dishonest" bank officials or individuals removed by
bank management or the banking agencies from
being reemployed in the banking industry. In this
regard, we would note that section 19 of the
Federal Deposit Insurance Act requires the
FDIC's approval for the employment by a bank
of any person previously convicted of a criminal
offense involving dishonesty or a breach of trust.
Moreover, as I have indicated, the Federal Reserve takes enforcement action to protect state
member banks from the improper activities of
any individual or insider. As a matter of principle, however, the primary responsibility must
fall on the financial institution to determine
whether or not a prospective employee who is to
be given important fiduciary responsibilities has
the proper qualifications for such a position. We
believe that it would be inappropriate for the
banking agencies to maintain a list of individuals
that had been the subject solely of civil enforcement actions for the purpose of preventing their
426
Federal Reserve Bulletin • May 1984
future employment with any institution. Indeed,
we believe that great care must be taken to avoid
any official action that could undermine an individual's rights or due process under the law.
It should be pointed out that the banking
agencies routinely exchange examination and
related supervisory reports in accordance with
applicable statutes. These reports contain information on the background and performance of
bank management and directors and are used in
connection with our supervision of banks and
our review of notices of changes in bank control.
This less formalized exchange of reports with our
sister supervisory agencies assists us in identifying potential situations in which an individual of
questionable background could have an adverse
effect on a banking organization. While not perfect, we believe this approach is preferable to the
maintenance of formal lists that may be subject
to error, misuse, or inadvertent disclosure, and
that could in turn deny an individual due process
or unfairly damage his reputation.
In considering the question raised by the subcommittee of the public disclosure of enforcement actions, it should be noted that a good deal
of disclosure already takes place. For example,
companies that are required to file public financial statements must also disclose any enforcement actions that are deemed to be material. In
addition, the banking agencies make public on an
annual basis case-by-case summaries of supervisory enforcement actions. These summaries do
not identify specific companies or individuals,
but they do provide detail on the enforcement
provisions of individual supervisory actions and
the specific types of problems the actions are
intended to correct. In certain egregious cases,
the Federal Reserve has disclosed the names of
individuals or companies subjected to civil money penalties for engaging in improper conduct or
violations of substantive banking regulations.
Finally, information is made available to the
public annually on a bank's aggregate loans to its
executive officers, principal shareholders, and
their related interests.
The question of whether there should be routine disclosure by supervisory agencies of all
enforcement actions against individuals or institutions requires careful consideration of a number of important procedural, privacy, and supervisory matters. It can be argued that public
disclosure may serve as a deterrent to those
insiders who might be inclined to abuse their
positions or otherwise engage in improper or
self-serving activities. However, public disclosure of supervisory actions in some instances
could prove counterproductive from a supervisory standpoint. For example, such disclosures
could have a disruptive effect on a bank's funding or overall financial condition, thereby potentially aggravating a delicate situation that the
supervisory action was intended to correct. In
addition, our experience suggests that if it were
understood that supervisory agencies would, as a
matter of routine, disclose all enforcement actions, financial institutions or individuals subject
to such proceedings would be more likely to
refuse to consent voluntarily to its provisions.
This refusal would tend to frustrate expeditious
correction of the problems.
The Federal Reserve, together with the other
supervisory agencies, has a vital interest in ensuring that possible criminal misconduct in the
nation's banks be uncovered and promptly terminated. We support vigorous and timely prosecution and punishment of any bank officer, director, or other insider found to be engaged in
criminal activities, and stand ready to assist in
this process in any manner that is consistent with
our statutory authority and primary responsibilities. In any event, we remain firmly committed
to taking timely remedial action against any
insider abuse, regardless of whether or not it
constitutes a violation of criminal statutes.
•
427
Announcements
PUBLICATION
OF BOOK
ON THE MULTICOUNTRY
MODEL
In order to improve the analysis of the international influences on the U.S. economy and those
on the world economy emanating from the United States, the Board of Governors, through its
Division of International Finance, developed the
concept of the Multicountry Model. In its present form, the Multicountry Model is a system of
national macroeconomic models at the center of
which is a medium-sized model of the U.S.
economy. Linked to the U.S. model and to each
other are models for Canada, West Germany,
Japan, and the United Kingdom, and an abbreviated model representing the rest of the world.
The Multicountry Model focuses on the impact
of the foreign sector on key domestic variables,
allows for a regime of either flexible or fixed
exchange rates, and incorporates the major real
and financial linkages between the U.S. and
foreign economies.
The U.S. Economy in an
Interdependent
World: A Multicountry Model by Guy V.G.
Stevens, Richard B. Berner, Peter B. Clark,
Ernesto Hernandez-Cata, Howard J. Howe, and
Sung Y. Kwack describes the system, its properties, and the intellectual process underlying its
development. The book discusses in detail the
theoretical structure of the system and its basic
empirical characteristics—the estimated parameters, statistics of performance, and basic multipliers. Whenever possible, the theoretical and
empirical characteristics are compared with
those for other existing theoretical and econometric models. Also examined are the alternatives considered for achieving the objectives of
the project and the justification of the structure
actually chosen for the system. In addition to the
normal range of fiscal and monetary multipliers,
the book includes the results of simulations that
give a view of the full range of the Multicountry
Model's capabilities: for example, estimates of
the effects of switches in exchange rate regimes,
the transmission of the effects of policy changes
from one country to another, and the impact of
changes in intervention policy and asset preferences.
The book is $14.50 a copy and may be obtained
from Publications Services, Board of Governors
of the Federal Reserve System, Washington,
D.C. 20551.
STATEMENT
FINANCING
ON
ARGENTINE
PACKAGE
The following statement was released on April
12, 1984, in response to inquiries about the role
of the Federal Reserve in the Argentine financing
package.
1. No Federal Reserve money or guarantee is
involved in the $100 million Argentine loan from
a group of commercial banks.
2. Federal Reserve involvement derives entirely from the fact that the Federal Reserve
Bank of New York is agent for foreign central
banks and in the normal course holds their
deposits and makes payments from their accounts.
3. Pursuant to an agreement among Argentina
and the government lenders, Argentina agreed,
in the event of failure, to complete pending
arrangements for lending with the entire syndicate of banks and to pay the banks in the lending
group $100 million out of Argentine deposits with
the Federal Reserve Bank of New York by
June 30.
4. Such instructions were transmitted to the
Federal Reserve Bank of New York by Argentina, and the Bank in turn did inform the commercial banks that procedures reflecting Argentine
obligations to repay this loan had been completed. This is the full extent of the Federal Reserve's involvement with the banks.
428
Federal Reserve Bulletin • May 1984
CHANGE IN
OF FEDERAL
BOUNDARIES
RESERVE
DISTRICTS
The Board of Governors has approved the transfer of eight counties in Oklahoma from the Eleventh Federal Reserve District to the Tenth Federal Reserve District, effective May 24, 1984.
These counties include Atoka, Bryan, Choctaw,
Coal, Johnston, McCurtain, Marshall, and Pushmataha. This date is the beginning of a reserve
maintenance period under the contemporaneous
reserve requirement procedures and therefore
should facilitate the transfer for the financial
institutions in the eight counties in southeast
Oklahoma.
Beginning May 24, all operational and other
matters relating to member banks in these counties will be assumed by the Federal Reserve
Bank Branch in Oklahoma City, Oklahoma, or
by the Federal Reserve Bank of Kansas City,
Missouri, with the exception of matters related
to delivery and receipt of currency and coin.
Currency and coin operations will continue to be
the responsibility of the Federal Reserve Bank of
Dallas.
CHANGES
IN BOARD
STAFF
The Board of Governors has announced the
following changes in the official staff of the
Division of International Finance:
Larry J. Promisel, Associate Director, has
been promoted to Senior Associate Director.
Dale W. Henderson, Deputy Associate Director, has been promoted to Associate Director.
Robert F. Gemmill has been designated Staff
Adviser.
Peter Hooper III has been appointed Assistant
Director.
David H. Howard has been appointed Assistant Director.
Raymond Lubitz has been appointed Assistant
Director.
Mr. Hooper came to the Board in September
1973 and was appointed Chief of the Quantitative
Studies Section in June 1981. Mr. Hooper has a
Ph.D. in Economics from the University of
Michigan.
Mr. Howard has been employed at the Board
since June 1975 and has been Senior Economist,
World Payments and Economic Activities Section, since February 1982. Mr. Howard holds a
Ph.D. in Economics from the University of Virginia.
Mr. Lubitz came to the Board in September
1973 and has been Chief, World Payments and
Economic Activity Section, since June 1981. Mr.
Lubitz has a Ph.D. in Economics from Harvard
University.
SYSTEM
MEMBERSHIP:
ADMISSION OF STATE
BANKS
The following banks were admitted to membership in the Federal Reserve System during the
period April 10 through May 10, 1984:
Florida
Kissimmee
Barnett Bank of Kissimmee
Illinois
Carbondale . . . . Midamerica Bank and Trust
Company of Carbondale
429
Legal Developments
AMENDMENTS
TO REGULATION
A
The Board of Governors has amended its Regulation
A, "Extensions of Credit by Federal Reserve Banks,"
for the purpose of adjusting discount rates. The
change—the first since late 1982—was undertaken in
the light of the relatively wide spread that has developed in recent weeks between short-term market rates
and the discount rate.
The changes were effective on the dates specified
below:
1. Section 201.51 is revised to read as follows:
Section 201.51—Short Term Adjustment Credit
for Depository Institutions
The rates for short term adjustment credit provided to
depository institutions under § 201.3(a) of Regulation
A are:
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
Rate
Effective
April
April
April
April
April
April
April
April
April
April
April
April
9,
9,
9,
10,
9,
10,
9,
9,
9,
13,
9,
13,
1984
1984
1984
1984
1984
1984
1984
1984
1984
1984
1984
1984
2. Section 201.52 is revised to read as follows:
Section 201.52—Extended Credit to Depository
Institutions
(a) The rates for seasonal credit extended to depository institutions under § 201.3(b)(1) of Regulation A
are:
Rate
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
9
9
9
9
9
9
9
9
9
9
9
9
Effective
April
April
April
April
April
April
April
April
April
April
April
April
9,
9,
9,
10,
9,
10,
9,
9,
9,
13,
9,
13,
1984
1984
1984
1984
1984
1984
1984
1984
1984
1984
1984
1984
(b) The rates for other extended credit provided to
depository institutions under sustained liquidity pressures or where there are exceptional circumstances or
practices involving a particular institution under
§ 201.3(b)(2) of Regulation A are:
Part 201—Extensions of Credit by Federal
Reserve Banks
Federal
Reserve Bank
Federal
Reserve Bank
Federal
Reserve Bank
Effective
Rate
April
April
April
April
April
April
April
April
April
April
April
April
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
9,
9,
9,
10,
9,
10,
9,
9,
9,
13,
9,
13,
1984
1984
1984
1984
1984
1984
1984
1984
1984
1984
1984
1984
NOTE: These rates apply for the first 60 days of borrowing. A 1 per
cent surcharge applies for borrowing during the next 90 days, and a 2
per cent surcharge applies for borrowing thereafter.
AMENDMENT
TO RULES
DELEGATION
OF A
REGARDING
UTHORITY
The Board is amending 12 CFR Part 265, Rules
Regarding Delegation of Authority, to revise its procedures for reviewing Reserve Bank expenses under its
general oversight authority. This change is intended to
clarify that the source of a Reserve Bank's authority to
take actions in certain areas is to be distinguished from
actions taken on behalf of the Board pursuant to a
grant of authority from the Board.
Effective April 11, 1984, the Board amends Rules
Regarding Delegation of Authority by removing para-
430
Federal Reserve Bulletin • May 1984
graph (d) and reserving it for future use; by changing
the first semi-colon to a colon in the introductory
paragraph 265.2(f) and removing the words "as to its
officers under paragraph (f)(23) of this section; and as
to its own facilities under paragraph (f)(26) of this
section:" and by removing subparagraphs (23), (26),
and (33) through (42) and redesignating subparagraphs
(24), (25), (27) through (32), and (43) through (58),
respectively.
BANK HOLDING COMPANY, BANK MERGER, AND
BANK SERVICES CORPORATION ORDERS ISSUED
BY THE BOARD OF GOVERNORS
Orders Issued Under Section 3 of Bank Holding
Company Act
Ark-Valley Bancorp, Inc.
Hutchinson, Kansas
Order Approving
Company
Formation
of a Bank
Holding
Ark-Valley Bancorp, Inc., Hutchinson, Kansas, has
applied for the Board's approval under section 3(a)(1)
of the Bank Holding Company Act ("Act"), 12 U.S.C.
§ 1842(a)(1), to become a bank holding company by
acquiring all of the voting shares of Northgate National Bank, Hutchinson, Kansas ("Bank"), 19.9 percent
of the voting shares of Valley Bancorp, Inc., Hutchinson, Kansas ("Valley"), and 16.7 percent of the voting
shares of Garden Banc Shares, Inc., Hutchinson,
Kansas ("Garden"). Both Valley and Garden are bank
holding companies within the meaning of the Act.
Notice of the application, affording opportunity for
interested persons to submit comments, has been
given in accordance with section 3(b) of the Act. The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the factors set forth in section 3(c) of
the Act.
Applicant is a nonoperating Kansas corporation
organized for the purpose of becoming a bank holding
company. Bank holds deposits of $11.3 million and is
one of the smaller banks in Kansas. 1 Valley is a onebank holding company that controls Valley State
Bank, Syracuse, Kansas ("Valley Bank"), which
holds deposits of $15.3 million. Garden is a one-bank
holding company that controls Fourth Bank of Garden
City, N . A . , Garden City, Kansas ("Fourth Bank"),
which holds deposits of $6.5 million. Bank, Valley
Bank and Fourth Bank operate in separate banking
1. Banking data are as of December 31, 1983.
markets. Bank operates in the Reno County banking
market, 2 wherein it controls 2.4 percent of the total
deposits in commercial banks. A principal of Applicant currently owns a bank holding company whose
subsidiary bank is located in Bank's market; however,
the principal will divest that banking organization prior
to consummation of this proposal. Accordingly, consummation of this proposal would have no significant
effect on competition or the concentration of banking
resources in any relevant area.
The financial and managerial resources of Applicant
and the banks and holding companies to be acquired
are regarded as generally satisfactory and their prospects are favorable, particularly in light of certain
commitments by Applicant's principal. Considerations
relating to the convenience and needs of the community to be served also are consistent with approval of the
proposal.
On the basis of the record, the application is approved for the reasons summarized above. The transactions 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
Kansas City, acting pursuant to delegated authority.
By order of the Board of Governors, effective
April 16, 1984.
Voting for this action: Chairman Volcker and Governors
Martin, Wallich, Partee, Rice, and Gramley. Absent and not
voting: Governor Teeters.
JAMES M C A F E E ,
[SEAL]
Associate
Secretary
of the Board
Charter 95 Corporation
Hudson, Wisconsin
Order Approving
Acquisition
of a Bank
Charter 95 Corporation, Hudson, Wisconsin, a bank
holding company within the meaning of the Bank
Holding Company Act ("Act") (12 U.S.C. § 1841
et seq.), has applied for the Board's approval under
section 3(a)(3) of the Act (12 U . S . C . § 1842(a)(3)) to
acquire 99.8 percent of the voting shares of Hammond
State Bank, Hammond, Wisconsin ("Bank").
Notice of the application, affording an opportunity
for interested persons to submit comments, has been
given in accordance with section 3(b) of the Act. The
time for filing comments has expired and the Board
has considered the application and all comments re-
2. The Reno County banking market consists of Reno County,
Kansas.
Legal Developments
ceived in light of the factors set forth in section 3(c) of
the Act (12 U.S.C. § 1842(c)).
Applicant, the 208th largest commercial banking
organization in Wisconsin, controls one bank with
total deposits of approximately $29 million, representing 0.1 percent of total deposits in commercial banks in
the state. 1 Bank is one of the smaller commercial
banking organizations in Wisconsin, with total deposits of approximately $8.4 million, representing less
than 0.1 percent of the total deposits in commercial
banks in the state. Upon consummation of this proposal, Applicant would control total deposits of $37.4
million, representing 0.1 percent of the total deposits
in commercial banks in the state. Applicant's acquisition of Bank would have no significant effects on the
concentration of banking resources in Wisconsin.
Bank is the 17th largest of 19 commercial banks in
the St. Croix Falls banking market,2 wherein it controls 1.6 percent of the total deposits in commercial
banks. 3 Applicant does not operate in the St. Croix
Falls banking market. Consummation of this proposal
would not result in any adverse effects on competition.
The financial and managerial resources of Applicant
and Bank are regarded as consistent with approval of
the application and their prospects appear favorable.
While Applicant has not proposed any new services to
be conducted by Bank upon consummation of this
proposal, there is no evidence in the record to indicate
that the banking needs of the community to be served
are not being met.
Based on the foregoing and other facts of record, the
Board has determined that approval of the application
would be consistent with the public interest and that
the application should be and hereby is approved. 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 Board or the Federal Reserve Bank
of Minneapolis, acting pursuant to delegated authority.
By order of the Board of Governors, effective
April 27, 1984.
Voting for this action: Chairman Volcker and Governors
Martin, Wallich, Partee, Rice, and Gramley. Absent and not
voting: Governor Teeters.
JAMES MCAFEE,
[SEAL]
Associate
Secretary of the Board
1. Unless otherwise indicated, banking data are as of December 31,
1983.
2. The St. Croix Falls banking market is defined as all of Polk and
St. Croix Counties, Burnett County except for the township of
Hudson, and the northern quadrant of Pierce County, Wisconsin.
3. As of March 31, 1983.
431
Citicorp
New York, New York
Order Approving Acquisition
of a Bank
Citicorp, New York, New York, a bank holding company within the meaning of the Bank Holding Company Act (the "Act"), has applied for the Board's
approval under section 3(a)(3) of the Act (12 U.S.C.
§ 1842(a)(3)) to acquire all of the voting shares of
Citibank (Maryland), N.A., Towson, Maryland
("Bank"), a proposed new bank.
Notice of the application, affording opportunity for
interested persons to submit comments, has been
given in accordance with section 3(b) of the Act. The
time for filing comments has expired, and the Board
has considered the application and all comments received, including those submitted by the Coalition
Against Redlining, New York, New York, in light of
the factors set forth in section 3(c) of the Act
(12 U.S.C. § 1842(c)).
Citicorp, with total consolidated assets of $134.6
billion as of December 31, 1983, is the largest banking
organization in the United States. Citicorp currently
operates four subsidiary banks. Its lead bank, Citibank, N.A., New York, New York, which accounts
for approximately 84 percent of Citicorp's consolidated assets, is the second largest commercial bank in
New York State, with $25.7 billion in total domestic
deposits, representing 13.8 percent of total deposits in
commercial banks in New York State. 1 Citibank (New
York State), N.A., Buffalo, New York, is a full service
commercial bank operating principally through
branches in the state north of the New York City
metropolitan area. Citibank (South Dakota), N.A.,
Sioux Falls, South Dakota, is principally engaged in
nationwide credit card activities, and Citibank (Delaware), Wilmington, Delaware, engages primarily in
wholesale banking on a national and international
basis. Citicorp also engages, directly and through
subsidiaries, in a variety of nonbanking activities.
Bank is a newly chartered bank. It will offer on a
nationwide basis various consumer credit products,
including certain credit cards, that are currently offered only on a regional basis by Citicorp Financial,
Inc., Towson, Maryland, a nonbanking subsidiary of
Citicorp. In addition, Bank will accept demand deposits and make commercial loans.
Section 3(d) of the Act (12 U.S.C. § 1842(d)) prohibits the Board from approving any application by a bank
holding company to acquire any bank located outside
the state in which the operations of the bank holding
company's banking subsidiaries are principally con1. Unless otherwise indicated, banking and market data are as of
December 31, 1982.
432
Federal Reserve Bulletin • May 1984
ducted unless such acquisition is "specifically authorized by the statute laws of the state in which the bank
is located, by language to that effect and not merely by
implication." The State of Maryland recently amended its banking laws to provide that a bank holding
company located outside of Maryland may acquire all
of the voting shares of a single newly established bank
located in Maryland that complies with several limitations, including requirements that the bank have no
more than one office open to the public to conduct
banking business and be operated "in a manner and at
a location that is not likely to attract customers from
[Maryland] to the substantial detriment of existing
state banking institutions, or national banks or federal
savings banks located in [Maryland]." 2
The proposed acquisition under Maryland law is
subject to approval by the State Bank Commissioner,
who must consider the financial and managerial resources of the out-of-state bank holding company, the
future prospects of the bank to be acquired, the
financial history and future prospects of the outof-state bank holding company, and whether the
proposed acquisition may result in an undue concentration of resources or substantial reduction of
competition in Maryland.3 The Maryland Bank Commissioner has reviewed the proposal by Citicorp to
acquire Bank and, on January 6, 1984, approved the
proposal under Maryland law. Based on the foregoing
and all the facts of record, the Board has determined
that the proposed acquisition conforms with Maryland
law and is specifically authorized by the statute laws of
Maryland for purposes of section 3(d) of the Act.
In view of the limitations imposed by Maryland law
on the operations of Bank, it is not likely that Bank
will be a significant competitor in the Baltimore banking market.4 The Board notes that the primary focus of
Bank will be the offering of various consumer credit
products, including certain credit cards, on a nationwide basis. Bank will also hold demand and other
types of deposits, and make commercial loans. Inasmuch as Bank will provide these services de novo, the
Board concludes that the proposal will not have adverse effects on competition in any relevant area, and
that the overall competitive effects of the proposal are
consistent with approval.
2. Maryland Financial Institutions Code Annotated § 5-903(b)
(Supp. 1983). Maryland law also provides that a bank acquired by an
out-of-state bank holding company may be operated in a manner likely
to attract and retain customers with whom the bank, the out-of-state
bank holding company, or the banking or nonbanking subsidiaries of
the bank holding company have or have had business relations.
3. Maryland Financial Institutions Code Annotated § 5-904(b)
(Supp. 1983).
4. The Baltimore banking market is approximated by the Baltimore
RMA, and includes all of Baltimore and Harford Counties, northern
Anne Arundel County, northern Howard County, and the eastern
portion of Carroll County, all in Maryland.
The financial and managerial resources and future
prospects of Citicorp, its subsidiaries, and Bank are
consistent with approval of this application. In this
regard, the Board has considered the capital position
of Citicorp in light of the Board's capital adequacy
guidelines. The Board has noted the improvements
that Citicorp has made in its capital position, Citicorp's compliance with the commitment made in connection with its application to acquire New Biscayne
Federal Savings and Loan Association and First Federal Savings and Loan Association to raise sufficient
additional capital by March 31, 1984, to place Citicorp
in conformance with the Board's minimum capital
adequacy guidelines, and Citicorp's statement that,
subject to reasonable economic and market conditions, it will increase its capital ratio materially above
the Board's minimum capital adequacy guidelines by
December 31, 1984. In its consideration of the financial aspects of this application, the Board has relied on
Citicorp's continuing efforts to improve its capital
position. Accordingly, the Board has determined that
banking factors are consistent with approval of this
proposal.
In considering the effects of the proposed acquisition on the convenience and needs of the communities
to be served, the Board has considered the record of
Citicorp's subsidiaries in meeting the credit needs of
their communities as provided in the Community
Reinvestment Act of 1977 ("CRA") (12 U.S.C.
§§ 2901-05) and the Board's Regulation BB (12 CFR
§ 228). In this regard, the Board has reviewed the
objections raised by the Coalition Against Redlining
("Protestant") concerning the performance of Citicorp's lead bank, Citibank, N.A., under the CRA.
Protestant argues that, since 1979, Citibank has
engaged in a pattern of branch closings, particularly in
the Bronx and Brooklyn, that discriminates against
minority and low-to-moderate income residents, particularly with regard to the availability of residential
mortgages. 5 As the Board has previously stated, while
the Board may not prescribe the manner in which an
applicant conducts its operations provided they conform with applicable law and banking practice, the
Board does expect an applicant to conduct its operations with due regard to serving the needs of its
community. 6 In this regard, the Board notes that the
opening and closing of branches is a factor that is
considered by the Federal bank regulatory agencies in
5. The Board has previously considered whether the closing of four
of these branches in the Bronx illustrated a policy by Citibank of
"disengagement" in the Bronx, and determined that the facts at that
time did not support a finding that Citibank was pursuing such a
policy. Citicorp,
68 FEDERAL RESERVE BULLETIN 499, 500 (August
1982).
6. Id. at 500. Accord, First National
Boston Corporation,
FEDERAL RESERVE BULLETIN 162 (February 1980).
66
Legal Developments
assessing the record of performance of a bank in
meeting the credit needs of its community.7
After reviewing all of the facts of record in this case,
the Board does not find that the record supports a
determination that Citibank is pursuing a discriminatory policy of branch closings. The Board notes that
the number of branches closed by Citibank in predominantly minority and low-income areas is proportionately higher than the number closed in predominantly
non-minority and higher-income areas, and the number of branches opened by Citibank in predominantly
minority and low-income areas is proportionately lower than the number opened in predominantly nonminority and higher-income areas. In this regard,
Protestant has submitted information alleging that in
the areas of Bronx County where Citibank has closed
branches, the number of mortgage loans made by the
bank decreased proportionately more than in areas
where Citibank did not close branches. The Reserve
Bank has conducted an independent analysis which
indicates, however, that, while mortgage lending has
decreased in some areas where Citibank has closed
branches, Citibank's overall mortgage lending activity
is not limited to areas where Citibank maintains a
branch.8 The Board also notes that Citibank has
initiated many special programs to help meet the credit
needs of the communities it serves. Citibank's performance under the CRA has been deemed satisfactory by the OCC as a result of an examination in April
1983.
In view of these and all of the other facts of record,
the Board has determined that the issues raised by
Protestant do not outweigh the positive aspects of
Citibank's record under CRA and that Citicorp's overall record is consistent with the purposes of the CRA.9
The Board would be seriously concerned about a
pattern of branch closings in minority and low-tomoderate income neighborhoods that impaired a
bank's ability to provide banking services to all segments of its community.10 The Board believes that
7. See, e.g., section 228.7(g) of the Board's Regulation BB, 12 CFR
§ 228.7(g).
8. For example, in Brooklyn, Queens, and the Bronx, approximately 68, 72, and 60 percent, respectively, of the residential mortgages
originated by Citibank were made in neighborhoods in which Citibank
did not maintain a branch.
9. The Board has also considered Protestant's request for a public
meeting regarding this matter and has determined that, in light of all of
the information presented by Protestant and Citicorp and the private
meetings between Protestant, representatives of Citicorp, and members of the staff of the Federal Reserve Bank of New York, a public
meeting is not warranted or necessary. Accordingly, the Board denies
Protestant's request for a public meeting.
10. Applicant has informed the Board that Citibank has established
internal standards and procedures which it uses to make determinations for closing branches. In addition, Citibank is considering seeking
the views of community representatives before making afirmdetermination whether a branch should be closed, an action that the Board
encourages.
433
branch closings by banks should be accomplished in
accordance with an overall objective that is consistent
with the bank's continuing and affirmative obligation
to help meet the banking needs of its entire community, including low- and moderate-income neighborhoods, and will continue to review Citibank's branch
closings, in the context of applications under the Act,
to assure that these obligations are met.
The Board has also considered the effect of this
proposal on the convenience and needs of the communities to be served by Bank and notes that, upon
consummation of this proposal, a variety of financial
services will become available to customers in the area
served by Bank, including various deposit alternatives, a new source of consumer and commercial
credit, and proposed ATM facilities. These additional
services lend weight to approval of the proposed
acquisition. Accordingly, the Board has determined
that considerations relating to the convenience and
needs of the communities to be served are consistent
with approval, and approval of this application would
be consistent with the public interest.
Based on all the facts of record, the Board has
determined that the application should be, and hereby
is, approved. 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 Board or the
Federal Reserve Bank of New York, acting pursuant
to delegated authority.
By order of the Board of Governors, effective
April 30, 1984.
Voting for this action: Chairman Volcker and Governors
Martin, Wallich, Partee, Rice, and Gramley. Absent and not
voting: Governor Teeters.
JAMES MCAFEE,
[SEAL]
Associate Secretary of the Board
Duke Financial Group, Inc.
New Prague, Minnesota
Order Approving Acquisition of a Bank Holding
Company and Bank
Duke Financial Group, Inc., New Prague, Minnesota,
a bank holding company within the meaning of the
Bank Holding Company Act of 1956, as amended
(12 U.S.C. § 1841 et seq.) ("Act"), has applied under
section 3(a)(3) of the. Act (12 U.S.C. § 1842(a)(3)) to
acquire Flag, Inc., Cambridge, Minnesota ("Flag"),
and thereby indirectly acquire Peoples State Bank of
Cambridge, Cambridge, Minnesota ("Cambridge
Bank").
434
Federal Reserve Bulletin • May 1984
Notice of the application, affording an opportunity
for interested persons to submit comments, has been
given in accordance with section 3(b) of the Act. The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the factors set forth in section 3(c) of
the Act.
Applicant is the 152nd largest commercial banking
organization in Minnesota, controlling one bank with
total deposits of $24.2 million, which represents 0.09
percent of the total deposits in commercial banks in
the state. 1 Flag, the 50th largest banking organization
in Minnesota, controls one bank, Cambridge Bank,
with total deposits of $45.5 million, representing 0.16
percent of deposits in commercial banks in the state.
Upon consummation, Applicant would become the
19th largest banking organization in the state, controlling 0.25 percent of total deposits in commercial banks
in the stater The Board concludes consummation
would have no significant effect on the concentration
of banking resources in Minnesota.
Cambridge Bank is the largest of 12 commercial
banking organizations in the Cambridge banking market, 2 controlling 18.5 percent of total deposits in
commercial banks in the market. Applicant does not
compete in the Cambridge banking market. Accordingly, the proposed acquisition would not result in the
elimination of any existing competition in this market.
The Board also has considered the effects of Applicant's proposal on probable future competition in the
Cambridge market in light of the Board's proposed
guidelines for determining whether an intensive examination of a proposed market extension merger or
acquisition is warranted.3 The proposal does not warrant an intensive analysis under the guidelines because
Applicant is not a probable future entrant under the
guidelines since it is not one of the four largest banking
organizations statewide and controls less than $500
million in assets. On the basis of the facts of record,
the Board concludes that consummation of this proposal would have no significant effect on probable
future competition in the Cambridge banking market.
1. Banking data are as of March 31, 1983.
2. The Cambridge banking market is approximated by Isanti County, the southern one-quarter of Mille Lacs County, and the northern
three-fifths of Chisago County.
3. "Proposed Policy Statement of the Board of Governors of the
Federal Reserve System for Assessing Competitive Factors Under the
Bank Merger Act and the Bank Holding Company Act," 47 Federal
Register 9017 (March 3, 1982).
The financial and managerial resources and future
prospects of Applicant are satisfactory. The financial
and managerial resources of Flag and Cambridge Bank
would be improved as a result of their acquisition by
Applicant, and upon consummation of this acquisition,
their future prospects would appear favorable. Although the services offered by Cambridge Bank would
not change as a result of this proposal, there is no
evidence that Cambridge Bank is not meeting the
needs of its community. Accordingly, considerations
relating to the convenience and needs of the communities to be served are consistent with approval of this
proposal.
Based on the foregoing, and other facts of record, it
is the Board's judgment that the proposed transactions
would be in the public interest and that the applications should be and hereby are approved. The proposed transactions 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 the Federal
Reserve Bank of Minneapolis, acting pursuant to
delegated authority.
By order of the Board of Governors, effective
April 12, 1984.
Voting for this action: Vice Chairman Martin and Governors Wallich, Partee, Rice, and Gramley. Absent and not
voting: Chairman Volcker and Governor Teeters.
JAMES MCAFEE,
[SEAL]
Associate
Secretary
of the Board
First Kentucky National Corporation
Louisville, Kentucky
Order Approving Acquisition
of Bank
First Kentucky National Corporation, Louisville,
Kentucky, a bank holding company within the meaning of the Bank Holding Company Act, 12 U.S.C.
§ 1841 et seq. ("BHC Act"), has applied for the
Board's approval pursuant to section 3(a)(3) of the
BHC Act to acquire First National Bank, Louisville,
Richmond, Virginia ("Bank"), a proposed de novo
bank.
Notice of the application, affording interested persons an opportunity to submit comments, has been
given in accordance with section 3(b) of the BHC Act.
The time for filing comments has expired, and the
Board has considered the application and all comments received in light of the factors set forth in
section 3(c) of the BHC Act, 12 U.S.C. § 1842(c).
Legal Developments
Applicant, the largest banking organization in Kentucky, with consolidated assets of $2.7 billion, controls two banks in that state, First National Bank of
Louisville, Louisville, Kentucky ("Louisville Bank"),
and First Kentucky Trust Company, Louisville, Kentucky. 1
Applicant proposes to acquire Bank to engage primarily in credit card operations. Applicant will transfer the credit card operations of Louisville Bank to
Bank, in light of Virginia's more liberal revolving
credit interest rate and credit card fee laws. 2 In
addition, Bank will engage in limited deposit-taking
and commercial loan activities.
Section 3(d) of the BHC Act, 12 U.S.C. § 1842(d),
prohibits the Board from approving any application by
a bank holding company to acquire any bank located
outside of the state in which the operations of the bank
holding company's banking subsidiaries are principally conducted 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." Virginia has recently passed
legislation authorizing an out-of-state bank holding
company to acquire a newly established bank in Virginia3 provided the acquiree bank has only a single
office open to the public for the conduct of its banking
business, the bank is created primarily to engage in a
significant multi-state credit card operation, the bank
will have at least $5 million or an amount equal to eight
percent of its assets in paid-in capital, whichever is
greater, on the date it commences business, the bank
employs 40 persons in Virginia within one year from
the date it commences business, the bank is operated
in a location not likely to attract customers from the
general public and the acquisition has the prior approval of the State Corporation Commission. 4 Applicant has stated that Bank has complied or will comply
with each of these conditions. Based on the foregoing,
the Board concludes that the proposed acquisition of
1. All banking data are as of September 30, 1983.
2. The Supreme Court has upheld the right of a national bank to
charge interest rates to out-of-state credit card customers at the rate
permitted by the law of its home state. Marquette National Bank v.
First of Omaha Serv. Corp. 439 U.S. 249 (1978).
3. VA. Code § 61-393 (1983). The Virginia statute is similar to other
state laws that the Board has found to be a valid exercise of a state's
authority under section 3(d) of the BHC Act. Citicorp (Citibank
435
Bank is consistent with the interstate banking prohibitions of section 3(d) and relevant state laws.
Section 2(c) of the BHC Act defines "bank" to
mean any institution that (1) accepts deposits that the
depositor has a legal right to withdraw on demand, and
(2) engages in the business of making commercial
loans. Although Bank will be engaged primarily in
credit card operations, Applicant has stated that Bank
will engage in limited deposit-taking and commercial
loan operations. In view of the purposes of the BHC
Act, the Board believes that the inclusion of Bank as a
"bank" within the meaning of section 2(c) is appropriate.
The proposal represents a transfer of the credit card
operations of Louisville Bank to Bank and, thus, is
essentially an internal reorganization that will not alter
the number of firms or the structure of the national
market for bank credit card services. Because of the
limitations imposed on Bank's operations by Virginia
law, Bank will not generally be in direct competition
with local commercial banks in the state. However, to
the extent that Bank will offer limited banking services
as a new competitor in the market, the effect of the
proposal will be procompetitive. Accordingly, the
overall competitive effects of the proposal are consistent with approval.
The financial and managerial resources and future
prospects of Applicant, its subsidiaries and Bank are
regarded as satisfactory. Transfer of Louisville Bank's
credit card operations will allow Applicant to continue
to service its customers who desire such services and
will result in greater efficiency. Based upon the foregoing and all the facts of record, the Board concludes
that convenience and needs factors are favorable and
lend weight toward approval of the proposal.
On the basis of all the facts of record in this matter,
it is the Board's judgment that approval of the application would be in the public interest and that the
application should be approved. On the basis of the
record, the application is approved for the reasons
summarized above. The transaction shall not be made
before the thirtieth calendar day following the effective
date of this Order or later than three months after the
effective date of this Order, unless such period is
extended for good cause by the Board or by the
Federal Reserve Bank of St. Louis pursuant to delegated authority.
By order of the Board of Governors, effective
April 6, 1984.
(South Dakota)), 67 FEDERAL RESERVE BULLETIN 181 (1981). See
Bank of New England Corp., 70 FEDERAL RESERVE BULLETIN 374
Voting for this action: Governors Wallich, Partee, Rice,
and Gramley. Absent and not voting: Chairman Volcker and
Governors Martin and Teeters.
(1984) (Press Release of March 26).
4. The Virginia Commissioner of Financial Institutions has approved the application. In addition, the Comptroller of the Currency
has approved Applicant's charter application for Bank.
[SEAL]
WILLIAM W . WILES,
Secretary
of the Board
436
Federal Reserve Bulletin • May 1984
First Railroad & Banking Company of Georgia
Augusta, Georgia
Order Approving
Company
the Acquisition
of a Bank Holding
First Railroad & Banking Company of Georgia, Augusta, Georgia, a bank holding company within the
meaning of the Bank Holding Company Act ("Act"),
has applied for the Board's approval under section 3 of
the Act (12 U.S.C. § 1842) to acquire SBT Corporation, Savannah, Georgia ("SBT"), and thereby indirectly acquire Savannah Bank & Trust Company,
Savannah, Georgia; Bank of Screven County, Sylvania, Georgia; Commercial Bank, Waycross, Georgia; First National Bank & Trust Company, Vidalia,
Georgia; The First National Bank of Valdosta, Valdosta, Georgia; and Central Bank of Georgia, Macon,
Georgia.
Notice of the application, affording opportunity for
interested persons to submit comments, has been
given in accordance with section 3 of the Act (49
Federal Register 3528 (January 27, 1984)). The time
for filing comments has expired, and the Board has
considered the application and all comments received
in light of the factors set forth in section 3(c) of the Act
(12 U.S.C. § 1842(c)).
Applicant is the fourth largest commercial banking
organization in Georgia with eight subsidiary banks
that control aggregate deposits of $1.3 billion,1 representing 5.5 percent of total deposits in commercial
banks in the state. SBT is the seventh largest commercial banking organization in the state, with six banking
subsidiaries that control aggregate deposits of $543.5
million, representing 2.4 percent of total deposits in
commercial banks in the state. Upon consummation of
the proposed acquisition. Applicant's share of total
deposits in commercial banks in the state would increase to 7.9 percent, and Applicant would remain the
fourth largest commercial banking organization in the
state. In the Board's view, consummation of this
acquisition would not have any significant adverse
effects on the concentration of commercial banking
resources in Georgia.
Because Applicant and SBT do not operate in any of
the same markets, consummation of this proposal
would not have a significant adverse effect upon
existing competition in any relevant market. The
Board has examined the effect of the proposed acquisition upon probable future competition in the relevant
geographic markets in light of the Board's proposed
market extension Guidelines. 2 Based on its review of
the record, the Board concludes that consummation of
the proposal would not have a significant adverse
effect upon potential competition in any relevant
market.
SBT operates in six markets in which Applicant
does not operate. 3 Four of these markets have deposits of less than $250 million, and thus are not considered attractive for entry and are not subject to intensive analysis under the Guidelines. In the Macon
banking market, SBT is not considered a market
leader because it is the fourth largest of the nine
commercial banking organizations that operate in the
market and controls only 5 percent of the deposits in
commercial banks in the market.
In the Savannah market, SBT is the second largest
of the 10 commercial banking organizations that operate in the market and controls 33 percent of the
deposits of commercial banks in the market. The
market is highly concentrated, with the three largest
commercial banking organizations controlling 81 percent of the total deposits of commercial banks in the
market. In addition, there are only two other Georgia
banking organizations with assets over $1 billion that
do not operate in the market, and the average growth
rate of deposits in the market for the past two years is
equal to the national average of 14 percent. In light of
these factors, the Board has carefully examined the
proposed acquisition to determine its effects on probable future competition in the Savannah market.
In its analysis of this proposal, the Board has
examined the effect of thrift institutions in the market.
The Board has previously indicated that, as a result of
the Garn-St Germain Depository Institutions Act of
1982,4 which expanded the commercial lending powers
of federal thrift institutions, and various state statutes,
thrift institutions have become, or at least have the
potential to become, major competitors of banks. 5
There are five thrift institutions that operate in the
Savannah market, controlling $450 million of the deposits in the market, representing almost one-third of
the market's total deposits. In addition, the market's
largest depository institution is a thrift institution; two
2. "Policy Statement of the Board of Governors of the Federal
Reserve System for Assessing Competitive Factors Under the Bank
Merger Act and the Bank Holding Company Act," 47 Federal
Register 9017 (March 3, 1982). While the proposed policy statement
has not been adopted by the Board, the Board is using the policy
Guidelines as part of its analysis of the effect of a proposal on probable
future competition.
3. These banking markets are as follows: Lowndes County, Screven County, Toombs County, Ware County, Macon, and Savannah,
all in Georgia.
4. Title III, 96 Stat. 1469, 1499-500.
5. General Bancshares
Corporation,
69 FEDERAL RESERVE BULLE-
TIN 802 (1983); First Tennessee National Corporation, 69 FEDERAL
1. Unless otherwise indicated, deposit data are as of June 30, 1982.
RESERVE B U L L E T I N 2 9 8 ( 1 9 8 3 ) .
Legal Developments
of the thrift institutions represented in the market are
among the largest thrift institutions in the state; and
one of the thrift institutions represented in the market
is a branch of the third largest thrift institution in the
country. All of these institutions offer NOW accounts
and are active in the consumer lending area. Moreover, the record indicates that the larger thrift institutions in the market actively seek commercial loans.
While the commercial loan portfolios of these institutions are not substantial at the present time, this
appears due to the fact that they have only recently
obtained commercial lending powers. In this connection, some of these institutions, including the market's
largest depository institution, have converted to federal savings banks and hold themselves out as full
service banks.
Based upon this and other evidence of record, the
Board believes that substantial weight should be given
to these institutions as competitors or potential competitors in the market. 6 Accordingly, in view of the
large share of the market's deposits held by thrift
institutions, their absolute size, and the actual and
potential competition provided by thrift institutions,
the Board concludes that consummation of the proposed acquisition would not have such adverse effects
on probable future competition in the Savannah market so as to warrant denial of the application.
Applicant operates in nine markets in which SBT is
not represented. 7 While SBT would not be considered
a probable future entrant into these markets under the
Guidelines because of its size relative to that of other
large banking organizations in the state, in view of its
managerial and financial resources and past history of
expansion, the Board has examined the markets in
which Applicant operates to determine if the elimination of SBT as an entrant would result in an adverse
effect on probable future competition. A review of the
nine markets in which Applicant, but not SBT, operates indicates that six of these markets are unattractive
for entry because of size and/or because the average
growth rate of deposits for the last two years in the
market is below the state or national average.
With regard to the remaining three markets in which
Applicant operates, the Board finds that these markets
do not meet all of the criteria that would trigger
6. If 50 percent of the deposits held by thrift institutions in this
market were included for determining the level of concentration in the
market, the market shares of the three largest depository institutions
in the market would be 69 percent. Moreover, if thrift institutions
were considered as potential competitors, there would be numerous
potential entrants into the Savannah market under the Board's Guidelines.
7. These banking markets are as follows: Coweta County, Harris
County, Spalding County, Pike County, Fayette County, Richmond
County, Atlanta, and Dalton, all in Georgia, and the Columbus
market, which is defined as Chattahoochee and Muscogee Counties,
Georgia, Russell County, Alabama, and the city of Smiths, Alabama.
437
intensive analysis under the Guidelines. The Atlanta
market is not concentrated, with the three largest
commercial banking organizations controlling 46 percent of the total deposits in commercial banks in the
market.
While the Dalton market is considered concentrated
under the Guidelines, the Board does not regard it as
attractive for entry because of its size and structure.
The Columbus market is highly concentrated, with the
three largest commercial banking organizations controlling 82 percent of the total deposits of commercial
banks in the market. However, there are a number of
other potential entrants into the market. After considering these facts, as well as the actual and potential
competition afforded by the thrift institutions in these
markets, the Board concludes that consummation of
this proposal would not result in a significant adverse
effect on probable future competition in the Dalton or
Columbus markets.
The financial and managerial resources of Applicant, SBT, and their subsidiary banks are generally
satisfactory and their future prospects appear favorable. Accordingly, considerations relating to banking
factors are consistent with approval. There is no
evidence in the record indicating that the banking
needs of the communities to be served are not being
met. Applicant will expand its automatic teller machine network to Macon, an area where SBT does not
provide these services. In addition, Applicant will
soon become a member of Nationnet, a nationwide
system of automatic teller machines, and SBT's subsidiaries will also become members of this system.
Accordingly, considerations relating to the convenience and needs of the community to be served also
are consistent with approval. Based on the foregoing
and other facts of record, the Board has determined
that consummation of the proposed transaction would
be consistent with the public interest and that the
application should be approved.
On the basis of the record, the application is approved for the reasons summarized above. The acquisition of shares shall not be made before the thirtieth
calendar day following the effective date of this Order
or later than three months after the effective date of
this Order, unless such period is extended by the
Board or by the Federal Reserve Bank of Atlanta,
acting pursuant to delegated authority.
By order of the Board of Governors, effective
April 6, 1984.
Voting for this action: Governors Wallich, Partee, Rice,
and Gramley. Chairman Volcker and Governors Martin and
Teeters did not participate in the consideration of this application.
JAMES MCAFEE,
[SEAL]
Associate Secretary of the Board
438
Federal Reserve Bulletin • May 1984
First York Ban Corp.
York, Nebraska
Order Approving Acquisition
of Banks
First York Ban Corp., York, Nebraska, a bank holding
company within the meaning of the Bank Holding
Company Act (12 U.S.C. § 1841 et seq.), has applied
under section 3(a)(3) of the Act (12 U.S.C.
§ 1842(a)(3)) to acquire all of the voting shares of The
First National Bank of Bradshaw, Bradshaw, Nebraska ("Bradshaw Bank"); The Blue River Bank,
McCool Junction, Nebraska ("McCool Bank"); and
Farmers and Traders Bank, Waco, Nebraska ("Waco
Bank").
Notice of the applications, affording opportunity for
interested persons to submit comments, has been
given in accordance with section 3(b) of the Act. The
time for filing comments has expired, and the Board
has considered the applications and all comments
received in light of the factors set forth in section 3(c)
of the Act (12 U.S.C. § 1842(c)).
Applicant, with only one banking subsidiary, The
First National Bank of York, York, Nebraska
("Bank"), is the 22nd largest banking organization in
Nebraska, controlling less than 1 percent of total
deposits in commercial banks in the state. 1 Upon
consummation of the proposal, Applicant would become the 9th largest banking organization in the state
and its share of deposits in commercial banks in the
state would remain less than 1 percent. Accordingly,
consummation of this proposal will have no significant
effect upon the concentration of banking resources in
Nebraska.
Applicant's subsidiary, Bank (deposits of $80 million), is the largest of seven banks located in the York
County banking market, holding approximately 49.4
percent of the market's total deposits in commercial
banks. 2 McCool Bank (deposits of $5.1 million), Bradshaw Bank (deposits of $5.5 million), and Waco Bank
(deposits of $7.2 million) are the fourth, fifth, and sixth
largest banks in the market and hold 4.4, 3.4, and 3.1
percent of the market's deposits in commercial banks,
respectively. Upon acquisition of these three banks,
Applicant would control 60.4 percent of the market's
deposits.
Section 3(c) of the Act precludes the Board from
approving any proposed acquisition of a bank that (1)
would result in a monopoly, or would be in furtherance
of any combination or conspiracy to monopolize or
attempt to monopolize the business of banking in any
part of the United States; or (2) may substantially
lessen competition or tend to create a monopoly or be
in restraint of trade in any banking market, unless the
Board finds that such anticompetitive effects are clearly outweighed by the convenience and needs of the
community to be served. In applying these standards
to a proposal such as this one, involving banking
organizations located in the same market, the Board
considers the competitive effects of the transaction
whereby common control of the institutions was established. 3
In this instance, the four banks have been under
common control continuously since 1905. The thenprincipals of Bank acquired Waco Bank (then in
operation for one year) in 1885, McCool Bank (then in
operation for two years) in 1889, and organized Bradshaw Bank de novo in approximately 1905. The four
banks were sold as a unit in 1912, and again in 1957.
The four banks have historically been operated as a
unit. In 1973, Bank was sold to Applicant, which was
formed by two individuals who had been officers and
directors and had directed the operations of the four
banks since the 1960's. Following the sale, the individuals continued as officers and directors of each of the
four banks and, according to the facts of record,
continued to control the management and policies of
the banks and, in effect, operated the four banks as a
unit.
The Board previously has approved bank holding
company applications involving affiliated banks in the
same market, relying on the small absolute size of the
banks at the time of affiliation, the substantial number
of years that the institutions had been affiliated, and
the existence of the affiliation before the application of
certain of the antitrust laws to bank mergers. 4
These factors are present in this case. Common
control of these four institutions was established in the
early 1900's, well before the enactment of the Bank
Merger Act of 1960 or the Celler-Kefauver Antimerger
Act of 1950. The record establishes that the affiliation
of these four banks has continued throughout the 79
year-period from 1905 to date. After considering the
facts of record, particularly the continuous and longstanding affiliation of the four institutions, the Board
concludes that consummation of the proposal will not
substantially lessen competition in the relevant
market.
3. See Mid Nebraska Bancshares, Inc., v. Board of Governors of
the Federal Reserve System, 627 F.2d 26 (D.C. Cir. 1980).
1. Deposit data are as of June 30, 1983.
2. The York County banking market consists of York County,
Nebraska.
4. First Monco Bancshares,
Inc., 69 FEDERAL RESERVE BULLETIN
293 (1983); Texas East Bancorp, 69 FEDERAL RESERVE BULLETIN 363
(1983).
Legal Developments
The financial and managerial resources and future
prospects of Applicant, Bank, Bradshaw Bank,
McCool Bank and Waco Bank appear to be generally
satisfactory. It appears that Applicant will be able to
service the debt incurred in this proposal in accordance with the Board's standards applicable to small
bank holding companies. Therefore, considerations
relating to banking factors are consistent with approval of the applications. Considerations relating to convenience and needs of the community to be served
also are consistent with approval of the applications.
Accordingly, it is the Board's judgment that the proposed acquisitions are in the public interest and that
the applications should be approved.
On the basis of the record, the applications are
approved for the reasons summarized above. The
transactions 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 the Federal Reserve Bank
of Kansas City acting pursuant to delegated authority.
By order of the Board of Governors, effective
April 3, 1984.
Voting for this action: Vice Chairman Martin and Governors Wallich, Partee, Rice, and Gramley. Absent and not
voting: Chairman Volcker and Governor Teeters.
JAMES MCAFEE,
[SEAL]
Associate
Secretary of the Board
Gainer Corporation
Merrillville, Indiana
Order Approving Acquisition
of Bank
Gainer Corporation, Merrillville, Indiana, a bank holding company within the meaning of the Bank Holding
Company Act of 1956, as amended (12 U.S.C. § 1841
et seq.) (the "Act"), has applied for the Board's
approval under section 3(a)(3) of the Act (12 U.S.C.
§ 1842(a)(3)) to acquire Hoosier State Bank of Indiana,
Hammond, Indiana ("Bank").
Notice of this application, affording opportunity for
interested persons to submit comments, has been
given in accordance with section 3(b) of the Act. The
time for filing comments has expired and the Board
has considered the application and all comments received in light of the factors set forth in section 3(c) of
the Act.
Applicant, with one subsidiary bank, is the fourth
largest banking organization in Indiana, with total
deposits of $540 million, representing 1.7 percent of
439
total deposits in commercial banks in the state. 1 Bank
is the 56th largest banking organization in Indiana,
with total deposits of $116.7 million, representing 0.37
percent of total deposits in commercial banks in the
state. Upon consummation, Applicant would remain
the fourth largest commercial banking organization in
Indiana and would control 2.1 percent of total deposits
in commercial banks in the state. Thus, the Board
concludes that acquisition of Bank would have no
significant effect on the concentration of banking resources in Indiana.
Applicant and Bank compete in the Gary-Hammond
banking market. 2 Applicant is the largest banking
organization in the market, controlling 21.4 percent of
total deposits in commercial banks in the market.
Bank, the ninth largest banking organization in the
market, holds 4.6 percent of total deposits held by
commercial banks in the market. Upon consummation, Applicant's market share of deposits would increase to 26 percent. The Gary-Hammond banking
market is considered moderately concentrated, with
the four largest banking organizations controlling 51.2
percent of market deposits in commercial banks and a
Herfindahl-Hirschman Index ("HHI") of 1024. Upon
consummation of this proposal, the four-firm concentration ratio would increase to 55.8 percent and the
HHI to 1221.3
Although the proposed acquisition would eliminate
some existing competition, the Board has concluded
that any adverse competitive consequences resulting
from this acquisition are mitigated by several factors.
In evaluating the competitive effects of a proposal in
previous cases, the Board has accorded considerable
weight to the influence of thrift institutions in circumstances in which these institutions provide an alternative for banking services. 4 Savings and loan associations have a significant presence in the GaryHammond market, representing four of the 10 largest
1. All banking data are as of June 30, 1983, unless otherwise
indicated.
2. The Gary-Hammond banking market is approximated by Lake
and Porter Counties, Indiana, which comprise the Gary-Hammond
Primary Metropolitan Statistical Area.
3. Under the Department of Justice Merger Guidelines (June 14,
1982), a market with an HHI between 1000 and 1800 is considered
moderately concentrated. The Justice Department has stated that
where a post-merger market HHI is between 1000 and 1800 and the
merger produces an increase in the HHI of 100 points or more, the
Justice Department is more likely than not to challenge such a merger.
4. First Tennessee National Corporation, 69 FEDERAL RESERVE
BULLETIN 298; Fidelcor, Inc. (Southeast National Bancshares of
Pennsylvania,
Bancorp,
Inc.,
Inc.),
69 FEDERAL RESERVE BULLETIN 445; NBD
(Pontiac State Bank), 69 FEDERAL RESERVE BOARD
917; Comerica (Bank of the Commonwealth), 69 FEDERAL RESERVE
BULLETIN 797; General Bancshares Corporation, 69 FEDERAL RESERVE B U L L E T I N 8 0 2 ( 1 9 8 3 ) .
440
Federal Reserve Bulletin • May 1984
depository organizations in the market. The 17 savings
and loan offices in the market hold 38.4 percent of total
deposits among commercial banks and savings and
loan associations in the market.5 Based on the deposittaking and lending activities of thrift institutions in the
Gary-Hammond market, the Board has concluded that
these institutions exert a mitigating influence on the
competitive effects of this proposal. 6
The Board also has considered the fact that the
Indiana Department of Financial Institutions ("DFI")
has declared Bank to be in imminent danger of becoming a "troubled financial institution," as defined by
Indiana law. 7 DFI has arranged the proposed acquisition under the section of the Indiana code governing
acquisition of troubled financial institutions in order to
ensure Bank's continued existence. Accordingly, the
Board concludes that this acquisition, which will enable Bank to remain a viable competitor in the market,
further mitigates any adverse competitive effects of
the proposal.
The application has been protested by a commenter
who asserts that the proposed acquisition would create
a multibank holding company in contravention of
Indiana law. In addition, the protestant has requested
the Board to consider other alternatives for the Bank.
Although Indiana law prohibits the formation of
multibank holding companies generally, 8 the statutes
provide an exception for acquisition of a "troubled
financial institution" by a bank holding company. 9
This statute permits DFI to authorize a merger or
acquisition of a bank if DFI makes certain findings
demonstrating that the institution has, or is in imminent danger of having, a capital ratio of less than 3
percent, impairment of its capital stock, or suspended
payments of its obligations. 10 Further, in selecting a
merger or acquisition partner, DFI must follow bidding procedures set forth in the statute. 11
The protestant claims that DFI failed to make the
required findings and that this transaction, thus, is not
authorized under state law. The Board has carefully
considered the issues raised by the protestant concerning the permissibility under state law of the acquisition
5. Savings and loan data are as of September 30, 1982.
6. When savings and loan data are considered, Applicant's market
share falls to 13.2 percent, and it remains as the largest depository
institution in the market. Bank's market share falls to 2.8 percent and
it becomes the 13th largest depository institution in the market. In
addition, including savings and loan institutions, the four-firm concentration ratio of the Gary-Hammond market is 33.4 percent and would
rise to 36.2 percent upon consummation of the proposal. Similarly, the
HHI of the market is 559 and would rise by 74 points to 633.
7. Indiana Code § 28-l-7.2-3(a) (Supp. 1983).
8. Indiana Code § 28-8-2-3 (1973).
9. Indiana Code § 28-1-7.2-3 (Supp. 1983).
10. Id.
11. Indiana Code § 28-l-7.2-3(b)-(f) (Supp. 1983).
of Bank by Applicant. 12 Based on information in the
record, it appears that DFI complied with the requirements of the statute. The record shows that DFI found
Bank to be "in imminent danger of becoming a troubled financial institution as defined in I.C. 28-1-7-2,
with no reasonable prospect of recovery." Further,
the record shows DFI reached this conclusion after
finding Bank was in imminent danger of having its
capital impaired. Accordingly, the Board concludes
that DFI conformed with the requirements of Indiana
law and that the proposed transaction would not
violate state law.
Further, although the Board is required by section
3(c) of the Act to evaluate bank holding company
applications in light of the factors listed in section 3(c),
including concentration of resources, competitive effects, financial and managerial resources and future
prospects of the parties, the Board is not required to
review DFI's selection of an appropriate bidder for the
failing Bank. 13
The financial and managerial resources of Applicant
and its subsidiary are considered satisfactory and their
future prospects appear favorable. Although Bank is
currently in less than satisfactory condition, with the
acquisition by Applicant, the prospects of Bank also
appear favorable. Thus, banking factors are consistent
with approval.
Upon acquisition, Applicant's trust department expertise, as well as its data processing system and
check clearing capabilities, will be available to Bank
and should result in decreased costs and increased
efficiency to Bank. Further, as noted above, the
proposed acquisition by Applicant will enable Bank to
remain a viable source of banking services in the
market. Thus, considerations relating to the convenience and needs of the community to be served are
consistent with approval.
Accordingly, based on the foregoing and other facts
of record, the Board has determined that consummation of the proposed transaction would be consistent
with the public interest and that the application should
be approved.
On the basis of the record, the application is approved for the reasons summarized above. The transaction shall not be made before the thirtieth calendar
day following the effective date of this Order, or later
than three months after the effective date of this
12. Under Whitney Bank v. New Orleans Bank, 379 U.S. 411, 419
(1965), the Board is prohibited from approving an application by a
bank holding company if consummation of the proposed transaction
would be prohibited by valid state law.
13. Citicorp
(Biscayne
157, 159, n . 7 (1984).
Federal),
70 FEDERAL RESERVE BULLETIN
Legal Developments
Order, unless such period is extended for good cause
by the Board, or by the Federal Reserve Bank of
Chicago pursuant to delegated authority.
By order of the Board of Governors, effective
April 3, 1984.
Voting for this action: Vice Chairman Martin and Governors Wallich, Partee, Rice, and Gramley. Absent and not
voting: Chairman Volcker and Governor Teeters.
JAMES MCAFEE,
[SEAL]
Associate
Secretary of the Board
McKenzie County Bancorp
Watford City, North Dakota
Order Approving Formation of a Bank Holding
Company
McKenzie County Bancorp, Watford City, North Dakota, has applied for the Board's approval under
section 3(a)(1) of the Bank Holding Company Act
(12 U.S.C. § 1842(a)(1)), to become a bank holding
company by acquiring at least 93 percent of the voting
shares of The McKenzie County National Bank, Watford City, North Dakota ("Bank").
Notice of the application, affording opportunity for
interested persons to submit comments and views, has
been given in accordance with section 3(b) of the Act.
The time for filing comments and views has expired,
and the Board has considered the application and all
comments received in light of the factors set forth in
section 3(c) of the Act.
Applicant, a nonoperating corporation with no subsidiaries, was organized under the laws of North
Dakota for the purpose of becoming a bank holding
company by acquiring Bank, which controls deposits
of approximately $9.0 million. 1 Upon acquisition of
Bank, Applicant would control the 117th largest commercial banking organization in North Dakota and
approximately 0.2 percent of the total deposits in
commercial banks in the state. Consummation of this
proposal would have no significant effects on the
concentration of banking resources in North Dakota.
Bank is the smallest of seven banking organizations
in the relevant banking market, 2 and holds 2.9 percent
of the total deposits in commercial banks therein.
Neither Applicant nor any of its principals is affiliated
1. All banking data are as of March 31, 1983.
2. The relevant banking market is approximated by William and
McKenzie Counties, North Dakota.
441
with any other banking organization in the market and,
therefore, consummation of the proposal would not
result in any adverse effects upon competition in any
relevant area.
The financial and managerial resources of Applicant
and Bank are regarded as generally satisfactory, and
the future prospects of each appear favorable, particularly in light of certain commitments made by Applicant's principals. Although Applicant does not anticipate any immediate changes in the services offered by
Bank, considerations relating to the convenience and
needs of the community to be served are consistent
with approval of the application. Accordingly, the
Board has determined that consummation of the transaction would be consistent with the public interest and
that the application should be approved.
On the basis of the record, the application is approved for the reasons summarized above. 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 Board or by the Federal Reserve Bank of
Minneapolis, acting pursuant to delegated authority.
By order of the Board of Governors, effective
April 10, 1984.
Voting for this action: Chairman Volcker and Governors
Martin, Partee, Rice, and Gramley. Absent and not voting:
Governors Wallich and Teeters.
JAMES MCAFEE,
[SEAL]
Associate
Secretary
of the Board
Mellon National Corporation
Pittsburgh, Pennsylvania
Order Denying Acquisition of a Bank and Merger of
Bank Holding Companies
Mellon National Corporation, Pittsburgh, Pennsylvania, a bank holding company within the meaning of the
Bank Holding Company Act of 1956, as amended,
12 U.S.C. § 1841 et seq., has applied for the Board's
approval under section 3(a) of the Act to acquire 100
percent of the voting shares of Heritage Bank, N.A.,
Jamesburg, New Jersey ("Heritage Bank"), and to
merge with Heritage Bancorporation, Jamesburg,
New Jersey ("Heritage Bancorp").
Mellon proposes to acquire Heritage Bancorp and
its subsidiary bank, Heritage Bank, through a series of
transactions. First, Mellon's subsidiary, Girard Bank,
Bala Cynwyd, Pennsylvania, would merge into Heritage Bank, followed immediately by a merger of
442
Federal Reserve Bulletin • May 1984
Heritage Bancorp into Mellon. Simultaneous with the
Girard Bank/Heritage Bank merger, Mellon's shares
of Girard Bank would be cancelled and replaced with
new voting shares issued by Heritage Bank (renamed
Mellon Bank East). At the same time, Heritage Bancorp's shares of Heritage Bank would be cancelled,
thereby giving Mellon control of Heritage Bank
(which, at this point, would have absorbed Girard by
merger). Heritage Bancorp's shareholders would receive Mellon stock or cash for their shares of Heritage
Bancorp. By letter dated February 27, 1984, the Board
determined that Mellon was required to obtain prior
approval for the proposed transactions under section
3(a) of the BHC Act.
On March 2, 1984, Mellon filed an application with
the Board for prior approval under the Act for the
proposal (reserving the claim that no application is
required). Notice of this application, affording an
opportunity for interested persons to submit comments, has been given in accordance with section 3(b)
of the Act. The time for filing comments has expired
and the Board has considered the application and all
comments received, including those from the Attorney
General and the Banking Commissioner of the State of
New Jersey, in light of the factors and requirements of
section 3 of the Act (12 U.S.C. § 1842(c)).
On March 27, 1984, the Comptroller of the Currency
approved the merger of Girard Bank into Heritage
Bank and determined that the retention by Heritage
Bank of branches at the former Girard and Heritage
Bank locations was consistent with the McFadden Act
and the statutes governing the merger of national
banks. 1
Mellon, the largest commercial banking organization in Pennsylvania, has consolidated assets of $26.4
billion and total domestic deposits of $12.6 billion. 2 In
addition to Girard, Mellon controls three other banks
1. 12 U.S.C. §§ 36 and 215a. The Comptroller concluded that
Heritage could have established branches at each of the Girard branch
sites under the McFadden Act (which allows a national bank to
establish a branch within the state in which it is situated) because
Heritage is "situated" in both New Jersey and Pennsylvania for
purposes of the McFadden Act.
The Comptroller found that Heritage Bank would have its "principal place of business" in Pennsylvania and could, therefore, branch
within Pennsylvania because Heritage Bank's proposed articles will
provide that, for purposes of Pennsylvania law, Heritage Bank's
"principal place of business" will be a designated office in Philadelphia. The Comptroller also found that Heritage Bank could retain its
New Jersey branches under New Jersey law and the McFadden Act
because, inter alia, Heritage Bank would maintain its "main office,
which shall also be its principal and head office" in New Jersey and
would be located in New Jersey for purposes of New Jersey law as
well as the National Bank Act.
2. Deposit data are as of June 30, 1982.
located in Pennsylvania and one bank located in
Delaware. Heritage Bank controls total assets of $1.8
billion and has total domestic deposits of $1.5 billion.
Heritage Bank operates 90 branches in the State of
New Jersey and one branch in Philadelphia, Pennsylvania, which holds $10 million in deposits. Heritage
Bank, one of only two national banks with branches in
more than one state, is authorized to retain its Philadelphia branch by the McFadden Act, which permits a
national bank to retain branches in operation before
February 25, 1927.3
Although consummation of this proposal would
eliminate some existing competition between Applicant and Heritage Bancorp in the Philadelphia and
Wilmington banking markets, the Board concludes
that the acquisition would not have any significant
adverse effects on competition in any relevant area.
Neither market is highly concentrated, and numerous
commercial banking organizations would remain in
each market upon consummation of the proposal. The
financial and managerial resources and future prospects of the organizations involved and considerations
relating to the convenience and needs of the communities to be served are consistent with approval of this
application.
The decisive issue in this application is whether the
Board is prohibited by the Douglas Amendment (section 3(d) of the Act, 12 U.S.C. § 1842(d)) from approving Mellon's application to acquire Heritage Bank.
The Douglas Amendment prohibits the Board from
approving an application by a bank holding company
to acquire any additional bank "located outside of the
State" in which the acquiring bank holding company's
subsidiary banks principally conduct their operations,
unless the state in which the bank to be acquired is
located specifically authorizes the acquisition. 4 In
Lewis v. B.T. Investment Managers, the United States
Supreme Court stated that the Douglas Amendment
3. 12 U.S.C. § 36.
4. The Douglas Amendment provides that:
No application . . . shall be approved under this section which
will permit any bank holding company or any subsidiary thereof
to acquire, directly or indirectly, any voting shares of, interest in,
or all or substantially all of the assets of any additional bank
located outside of the State in which the operations of such bank
holding company's banking subsidiaries were principally conducted on the effective date of this amendment or the date on
which such company became a bank holding company, whichever is later, unless the acquisition of such shares or assets of a
State bank by an out-of-State bank holding company 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. For the purposes of this section, the State in which the
operations of a bank holding company's subsidiaries are principally conducted is that State in which total deposits of all such
banking subsidiaries are largest. 12 U.S.C. § 1842(d).
Legal Developments
establishes a general federal prohibition on the acquisition or
expansion of banking subsidiaries across state lines. . . [and]
granted to the States. . . the authority to create exceptions to
this general prohibition, that is, to permit expansion of
banking across state lines where it otherwise would be
federally prohibited, (emphasis in the original). 5
Thus, by its terms, the Douglas Amendment prohibits the Board from approving an application by a
Pennsylvania bank holding company to acquire a bank
located in any state outside of Pennsylvania, unless
that state by statute specifically authorizes the acquisition. The issue that must be decided in this case is
whether Heritage Bank is a bank that is located
outside of Pennsylvania and, if so, whether the state in
which it is located has specifically authorized the
acquisition of Heritage Bank by an out-of-state bank
holding company.
The Attorney General and the Banking Commissioner of New Jersey oppose the Mellon application on
the grounds that Heritage Bank is located in New
Jersey because it is chartered and conducts its principal operations in New Jersey, and that it may not,
therefore, be acquired by a bank holding company,
such as Mellon, with a home state outside of New
Jersey without the specific authorization of New Jersey. The Attorney General states that New Jersey
statute laws do not specifically authorize an out-ofstate bank holding company to acquire a bank located
in New Jersey. The Attorney General also contends
that the acquisition is expressly prohibited by a New
Jersey law that prohibits the acquisition of a bank
located in New Jersey by an out-of-state bank holding
company.
Mellon asserts that the proposed transaction is not
barred by the Douglas Amendment because Heritage
is located in Pennsylvania by virtue of its Philadelphia
branch and that the Douglas Amendment does not bar
the acquisition by a bank holding company of a bank
located in the bank holding company's home state.
Mellon argues that the McFadden Act and Douglas
Amendment were intended to achieve the same result
and that, because the proposal is consistent with the
McFadden Act, it is consistent with the Douglas
Amendment. Alternatively, Mellon argues that, if the
Douglas Amendment applies to this transaction, New
Jersey law contains a provision that specifically authorizes this transaction.
The technical legal arguments outlined above, put
forward by Applicant and the State of New Jersey,
have been carefully evaluated by the Board. The
Board believes that the decision in this case turns upon
the language of the Douglas Amendment, a basic
5. 447 U.S. 27, 47 (1980).
443
judgment concerning its purposes and, in the light of
these purposes, a common sense analysis as to where
Heritage Bank is located. In this framework, the
Board has reviewed the facts concerning Heritage
Bank's charter, operations, management, deposits,
and branches.
Heritage Bank is chartered in New Jersey; its articles provide, as required by the National Bank Act,
that its "main office, which shall also be its principal
office and head office" will be located in New Jersey.
Mellon and Heritage Bank have also advised the
Comptroller that the "principal office" of Heritage
Bank will not be transferred to Pennsylvania after the
merger. Heritage Bank's management officials and
administrative offices are located in New Jersey and
would continue in that location after the proposed
merger. Heritage Bank's board of directors meet and
issue orders from offices in New Jersey and, similarly,
would continue this arrangement after the proposed
merger.
Heritage Bank has significantly expanded its New
Jersey operations over the years through branching de
novo in New Jersey and through mergers with other
New Jersey banks. As of September, 1983, Heritage
Bank maintained 90 branches in New Jersey. In contrast, since establishment of its branch in Pennsylvania
in 1813, 171 years ago, Heritage Bank has never
further expanded its operations in that State and has
maintained only one branch in Pennsylvania. Finally,
over 99 percent of Heritage Bank's deposits are derived through its branches located in New Jersey.
Thus, applying the literal language of the Douglas
Amendment to these facts, the proposed acquisition
would be prohibited since it is clear that Heritage Bank
is located outside of Pennsylvania. Moreover, pursuing the analysis beyond the literal language leads to the
same result.
The Douglas Amendment does not contain a specific
definition to guide the Board in determining whether
Heritage Bank is an additional bank "located outside
o f ' Pennsylvania, the applicant bank holding company's home state. 6 The Douglas Amendment states
explicitly that the location of the acquiring bank holding company—in this case, Mellon—is determined by
the state in which the total deposits of its subsidiary
banks are the largest—clearly Pennsylvania in this
case. It is evident that Congress had in mind some
level of appropriate contacts as a basis for determining
location, which in turn would serve as a basis for
applying the policies contained in the Amendment.
6. The primary dictionary definition of the verb "locate" is "to
take up one's residence; establish oneself or one's business." Webster's New International Dictionary, Third Edition (1956).
444
Federal Reserve Bulletin • May 1984
In the absence of specific Congressional direction
on this issue, the Board believes it would be reasonable to apply the Douglas Amendment standard for
location of bank holding companies to determine the
state in which Heritage Bank is located. By this
criterion, Heritage Bank is located in New Jersey, the
state in which over 99 percent of its deposits are held.
However, it is unnecessary in this case to make a
specific choice of standards since, by any other rational criterion, it is also obvious that Heritage Bank is
located in New Jersey. Viewed from the perspective of
its charter, the state in which it maintains its principal
office, and from which it conducts its affairs, Heritage
Bank is also located in New Jersey. Similarly, seen
from the point of view of the state in which all but one
of its branches are situated, Heritage Bank is located
in New Jersey.
Thus, by all common sense criteria, the overwhelming evidence is that Heritage Bank is located in New
Jersey, and thus outside of Pennsylvania. The fact that
Heritage maintains a very small branch in Philadelphia
does not change this result. The Board does not
believe it would be reasonable to use this incidental
branch to justify avoiding the application of the Douglas Amendment and New Jersey law to the proposed
merger of a Pennsylvania bank holding company with
a bank whose contacts are almost exclusively in New
Jersey. Such an interpretation would provide a vehicle
for evading the clear Congressional intent contained in
the Douglas Amendment.
The Douglas Amendment was clearly intended to
prevent an out-of-state bank holding company from
acquiring a bank located in a state unless the state
affirmatively authorized the acquisition. This amendment represented a compromise position between the
House and Senate versions of the original 1956 BHC
Act. The House-passed bill expressly prohibited all
interstate arrangements, 7 while the original Senate bill
did not prohibit the Board from approving interstate
acquisitions by bank holding companies. During the
debate on the bill on the floor of the Senate, Senator
Douglas offered a provision, similar to that now codified as section 3(d) of the BHC Act, explaining that
this provision was the "logical continuation of the
principles of the McFadden Act" and would serve the
purpose "in principle almost identical with the present
provision which governs branch banking . . . which
tried to prevent the federal power from being used to
permit national banks to expand across state lines in a
7. The House Report on the 1956 Act recognizes that, without this
type of prohibition, "States have no way to protect themselves against
an outside bank holding company coming in and buying stock in
banks, especially national banks, located within their borders." H.
Rep. No. 609, 84th Cong., 1st Sess. 3 (1955).
way contrary to State policy." 8 In view of the fact that
Heritage Bank is located in New Jersey, it would be
inconsistent with the purposes of the Douglas Amendment to adopt a technical definition of the term "located outside of the State [of Pennsylvania]" so as to
deny to the State of New Jersey the opportunity to
apply its policy to the acquisition of a bank that is
clearly and predominantly located in that State.
This analysis of the facts of this case and of the
Douglas Amendment is consistent with prior Board
interpretations. In Credit and Commerce
Holdings/
Financial General Bankshares, the Board stated that
"section 3(d) was designed to preclude the Board from
approving the creation of additional interstate bank
holding companies above and beyond those grandfathered under the Act." 9 The Board determined that the
acquisition of a grandfathered multi-state bank holding
company by a shell corporation would be permissible
under the Douglas Amendment because "no additional bank would be added to an existing multi-state bank
holding company structure."
Approval of Mellon's application would add Mellon,
which is not a grandfathered multi-state bank holding
company, to the list of multi-state bank holding companies. 10 Moreover, the multi-state bank holding company system that would result from Mellon's proposed
transaction would include additional banks (Mellon's
subsidiary banks in Pennsylvania) that were not previously part of a grandfathered bank holding company
system and that could not lawfully have been acquired
by that system under the Douglas Amendment.
Mellon's argument rests on the proposition that,
consistent with the interpretation of the term "situated" in the McFadden Act, Heritage is "located" for
purposes of the Douglas Amendment in each state in
which it maintains a branch.11 As noted, this proposi-
8. 102 CSC 6860 (1956) (remarks by Senator Douglas).
9 . 6 5 FEDERAL RESERVE B U L L E T I N 2 5 4 , 2 5 9 ( 1 9 7 9 ) .
10. Indeed, if Heritage Bancorp were a grandfathered multi-state
bank holding company with a bank in New Jersey and a bank in
Pennsylvania (instead of a branch in Pennsylvania), this application
would plainly be prohibited by the Douglas Amendment because
Heritage's New Jersey bank would be an additional bank located
outside the state in which Mellon's banking operations are principally
conducted.
11. In approving the Heritage Bank/Girard Bank merger, the
Comptroller relied upon the decision in Seattle Trust & Savings Bank
v. Bank of California, N.A., 492 F.2d 48 (9th Cir. 1974), cert, denied,
419 U.S. 844 (1974). In that case, the court held that, for purposes of
the McFadden Act, a bank is "situated" in each state in which it
operates a branch. The court held that, because the Bank of California
operated a grandfathered branch in Washington, it was "situated" in
Washington and therefore could also expand in Washington by
branching as if it were a Washington state bank, even though Bank of
California was chartered in California and conducted most of its
operations in that state. The Seattle Trust decision only addresses the
question of opening a de novo branch outside the Bank of California's
home state in order that the bank not be competitively disadvantaged
vis-a-vis similarly situated Washington banks. That decision does not
Legal Developments
tion, however, concedes that Heritage is located in
New Jersey as well as Pennsylvania and, under the
terms of the Douglas Amendment, approval of Mellon's proposal is prohibited.
To avoid this result, Mellon recasts the language of
the Douglas Amendment, arguing that the Douglas
Amendment does not prohibit the acquisition by a
bank holding company if any part of the target bank is
located within the home state of the acquiring bank
holding company. Under this interpretation, the Douglas Amendment would not bar Mellon's acquisition of
Heritage Bank because it is located in Pennsylvania,
notwithstanding the fact that, even under Mellon's
view, Heritage Bank would also be located in New
Jersey.
Mellon's argument might be given more weight if the
facts did not place Heritage Bank almost exclusively in
New Jersey. However, in the context of this case, this
interpretation relies upon the technicality of a $10
million deposit branch in Pennsylvania to acquire a
holding company with almost $2 billion of assets
located in New Jersey, despite a clear federal statutory
prohibition and the absence of the specific authorization of the state with the overwhelming policy interest
in the acquisition. Such an interpretation would require the Board to ignore the plain terms of the statute,
which prohibits the acquisition by Mellon of a bank
located outside of Pennsylvania, and would plainly be
contrary to the concept and intent of the Douglas
Amendment, giving to the states the right to authorize
entry into the state by out-of-state bank holding companies.
The Board recognizes that the Comptroller has
approved the merger of Girard into Heritage Bank as
permissible under the McFadden Act. However, the
Douglas Amendment applies different statutory language and addresses a different type of transaction.
The McFadden Act deals with the location of national
bank branches; the Douglas Amendment deals with
the interstate ownership of banks. The fact that Heritage Bank may, under an interpretation of the National
Bank Act, expand into Pennsylvania by merger does
not address the question of whether a Pennsylvania
bank holding company may acquire the resulting interstate bank.
The Board has also considered the argument that
since, under the Comptroller's ruling, Heritage Bank
may expand into Pennsylvania by merger, as a matter
address the question of whether a multi-state bank may, by a merger,
acquire and retain branches outside of its home state, such as is
proposed in the Heritage/Girard merger, or the question presented in
this case of whether a bank holding company located outside of
California may acquire Bank of California.
445
of equity, a Pennsylvania bank holding company
should be able to expand into New Jersey by acquisition of Heritage Bank. The McFadden Act's grandfather provision for interstate branches established before 1927 allows Heritage Bank to maintain a presence
in Pennsylvania and is an exception to the principle of
state authority over branching in recognition of the
fact that Heritage Bank operated a branch for over 100
years in Pennsylvania. The Board believes that it
would not be consistent with either the language or the
purpose and intent of the Douglas Amendment to
extend this limited grandfather right under the McFadden Act into the Douglas Amendment, particularly
where, as here, such an interpretation would vitiate
the ability of New Jersey to apply its policy of interstate acquisitions to a bank that by any reasonable
standard is clearly and predominantly located in New
Jersey. However, under existing Pennsylvania law and
as a practical matter, any expansion by Heritage Bank
in Pennsylvania would likely be limited. Moreover,
any acquisition by Heritage Bancorp (or any other
New Jersey bank holding company that acquired Heritage Bancorp) of a Pennsylvania bank would be subject to the BHC Act and the Douglas Amendment.
The Board has also carefully considered Mellon's
contention that the acquisition of a bank located in
New Jersey by an out-of-state bank holding company
has been "specifically authorized by the statute laws
of [New Jersey] . . . by language to that effect and not
merely by implication," as would be required by the
Douglas Amendment before the Board could approve
Mellon's proposal. 12 U.S.C. § 1842(d).
New Jersey law contains a prohibition against the
acquisition of banks located in New Jersey by out-ofstate bank holding companies. 12 Mellon argues that
this statute, however, provides an exception for an
acquisition of bank shares resulting from a merger or
consolidation of a bank with another bank. 13 Mellon
argues that, because its acquisition of Heritage Bank's
12. Section 17:9A-345 of the New Jersey Statutes provides:
Except as provided by sections 3 and 4 of this Act,
* * *
(b) No company which owns more than 25 percent of the stock of
either a bank located outside this State or a foreign bank shall
own or acquire ownership of more than 5 percent of the stock of a
bank located in this state.
Both the New Jersey Attorney General and the Comptroller have
concluded that Heritage Bank has its principal office and is located in
New Jersey for purposes of New Jersey law.
13. The exception upon which Mellon relies (section 4 of the Act
referred to in Section 17:9A-345 of the New Jersey statutes) provides:
[n]othing in this act shall prohibit a company from acquiring bank
stock in excess of the limitation imposed by section 2 of this Act
[§ 17:9A-345] if such acquisition results from an exchange of
stock resulting from the merger or consolidation of a bank with
another bank or banks. N.J. Stat. Ann. § 17:9A-347.
446
Federal Reserve Bulletin • May 1984
voting shares would occur as a result of the merger of
Heritage Bank with Girard Bank, New Jersey law
provides specific authorization for the interstate acquisition of Heritage Bank by Mellon.
The Board has previously concluded that an exception to a prohibition may be a sufficient specific
authorization for purposes of the Douglas Amendment
where it is clear from the terms of the statute, its
legislative history, or state practice under the statute
that the state enacted the exception in order to authorize interstate acquisitions. 14 In its decision in NCNB,
the Board found that the exception to the general
interstate prohibition in Florida law was a sufficient
authorization under the Douglas Amendment because
(1) the Florida statute clearly and on its face specifically excepted certain grandfathered institutions from the
state prohibition; (2) there was evidence of the clear
intent of the legislature to permit certain interstate
acquisitions by grandfathered entities, as demonstrated by the use of the state statute in previous cases to
permit grandfathered out-of-state bank holding companies to acquire additional institutions in the state; and
(3) the Attorney General of Florida determined that
NCNB, a grandfathered out-of-state bank holding
company, was not prohibited from acquiring a Florida
bank. 15
In this case, the New Jersey Attorney General has
rendered a formal opinion to the effect that the exception upon which Mellon relies does not apply to New
Jersey's interstate banking statute. 16 The exception
upon which Mellon relies (section 347) was enacted in
1957 to ensure that the 1957 New Jersey statute
banning the formation of multi-bank holding companies was not interpreted to prohibit a bank owned by a
New Jersey bank holding company from merging with
other banks in the same county. At that time, New
Jersey law did not contain an express prohibition
against acquisitions of New Jersey banks by out-ofstate bank holding companies. New Jersey's ban on
14. NCNB
Corporation,
68 FEDERAL RESERVE BULLETIN
59
(1982). The Board made a similar determination with respect to an
Iowa statute. See Northwest Bancorporation, 38 Federal Register
21530 (1973), affd. sub nom., Iowa Independent Bankers v. Board of
Governors of the Federal Reserve System, 511 F.2d 1288 (D.C. Cir.
1975). Although the issue of whether the Iowa statute was a specific
authorization under the Douglas Amendment was not before the
court, the court implicitly approved the use of the exception as a form
of language that could specifically authorize a transaction.
15. The issue in NCNB was whether an out-of-state bank holding
company that owned a trust company in Florida before the grandfather date in the Florida statute could acquire a bank in Florida. It was
undisputed that such a company could acquire another Florida trust
company and that an out-of-state bank holding company that owned a
bank in Florida before the grandfather date could acquire an additional
bank in Florida.
16. When interpreting state law, the Board has given substantial
weight to the reasoned opinions of state authorities. NCNB, supra;
Northwest
Kansas
Banc Shares,
TIN 9 8 ( 1 9 8 3 ) .
interstate acquisitions (section 345(b)) was enacted in
1968—11 years later and was placed in the same
section of the New Jersey bank holding company
statute as the 1957 ban on multi-bank holding companies. Based upon these facts and others specified in his
opinion, the Attorney General has stated that the
exception in section 347 does not apply to the prohibition in section 345. Moreover, he states that, in these
circumstances, the exception in section 347 cannot be
read to affirmatively authorize an acquisition of stock
of a New Jersey bank by an out-of-state bank holding
company.
In the Board's view, based upon all the facts of
record, including the opinion of the Attorney General,
the New Jersey statute upon which Mellon relies does
not constitute a specific authorization "by language to
that effect and not merely by implication," as required
by the Douglas Amendment. In contrast to the Iowa
and Florida statutes, where it was clear from the terms
of the statutes, their legislative histories, or state
practice that the states intended to permit some types
of interstate acquisitions, there is no indication that
New Jersey intended to permit any interstate acquisitions.
Without any definitive legislative history, the Board
believes that is unreasonable to impute to the New
Jersey legislature the belief that, by amending one
section of its law, it was specifically authorizing outof-state bank holding companies to acquire banks in
New Jersey, particularly where the exception was
enacted 11 years before and not in connection with
New Jersey's interstate banking prohibition. Thus, if
the New Jersey law authorizes interstate acquisitions,
this authorization is implied from the structure of the
New Jersey statute, and the authorization is not an
express authorization as explicitly required by the
Douglas Amendment. Moreover, the Board notes that,
unlike the Florida law at issue in NCNB, the New
Jersey statute, which is over 15 years old, has never
been used to permit any type of interstate bank holding
company acquisition in New Jersey.
For the foregoing reasons, the Board concludes that
the Douglas Amendment prohibits the Board from
approving Mellon's proposed acquisition of Heritage
Bancorp and Heritage Bank. Accordingly, Mellon's
application is hereby denied.
By order of the Board of Governors, effective
April 24, 1984.
Voting for this action: Chairman Volcker and Governors
Martin, Wallich, Rice, and Gramley. Voting against this
action: Governor Partee. Absent and not voting: Governor
Teeters.
JAMES MCAFEE,
Inc., 69 FEDERAL RESERVE BULLE-
[SEAL]
Associate
Secretary
of the Board
Legal Developments
Omaha National Corporation
Omaha, Nebraska
Order Approving Acquisition
Holding Companies
and Merger of Bank
Omaha National Corporation, Omaha, Nebraska, a
bank holding company within the meaning of the Bank
Holding Company Act of 1956, as amended (12 U.S.C.
§ 1841 et seq.)("Act"), has applied for the Board's
approval under section 3(a) of the Act (12 U.S.C.
§ 1842(a)) to acquire 45.2 percent of the voting shares
of First National Lincoln Corp., Lincoln, Nebraska
("FNLC"), also a bank holding company under the
Act. Applicant will thereby acquire control of FNLB's
subsidiary bank, First National Bank and Trust Company of Lincoln, Lincoln, Nebraska ("Lincoln
Bank"). Subsequently, FNLC will be merged into
Applicant, which will continue operations under the
name "Firstier, Inc."
Notice of the applications, affording opportunity for
interested persons to submit comments, has been
given in accordance with section 3(b) of the Act.
(12 U.S.C. § 1842(b)). 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 Act (12 U.S.C.
§ 1842(c)).
Applicant, the second largest banking organization
in Nebraska, controls one subsidiary bank with deposits of $714.4 million, which represent 6.2 percent of the
total deposits in commercial banks in the state.1
FNLC, the fifth largest banking organization in Nebraska, controls one bank with deposits of $534.2
million, which represent 4.7 percent of the total deposits in commercial banks in the state. Upon consummation of the proposal, Applicant would become the
largest banking organization in Nebraska, controlling
deposits of $1.2 billion, representing 10.9 percent of
the total deposits in commercial banks in the state.
With regard to concentration of banking resources,
Nebraska is one of the least concentrated states in the
nation and would remain so upon consummation of
this transaction. The four largest banking organizations in Nebraska control 25 percent of the total
deposits in commercial banks in the state and this
figure would increase to 29.7 percent upon consummation of this transaction. Accordingly, it is the Board's
judgment that consummation of the proposed transaction would not have a significant effect on the concentration of banking resources in Nebraska.
Because Applicant's subsidiary bank and FNLC's
subsidiary bank operate in separate banking markets,
1. All deposit data are as of December 31, 1982, unless otherwise
indicated.
447
consummation of the proposed transaction would not
eliminate any substantial existing competition. The
Board has also evaluated the effect of the proposed
merger of Applicant and FNLC upon probable future
competition in their respective banking markets and
considered the proposal in light of the Board's proposed guidelines on market extension mergers. 2 In
evaluating the effect of a proposed transaction on
probable future competition, the Board considers the
level of concentration in the market, the number of
probable future entrants into the market, the size of
the bank to be acquired, and the attractiveness of the
market for de novo or foothold entry. After consideration of these factors in the context of the specific
facts of this case, the Board concludes that consummation of this proposal would not have any significant
effects on probable future competition in any relevant
market.
Applicant's subsidiary bank, Omaha National Bank
("Omaha Bank"), operates in the Omaha, Nebraska,
banking market,3 and is the largest commercial bank in
the market controlling 23.5 percent of total deposits in
commercial banks in the market. The Omaha banking
market is not highly concentrated. The three largest
commercial banking organizations in the market control 64.5 percent of the total deposits in commercial
banks in the market, and there is no evidence in the
record that the market is not competitive. The Supreme Court has indicated that "the potential competition doctrine has meaning only as applied to concentrated markets." 4 Thus, the Board has determined that
the proposed transaction would have no significant
adverse effects on probable future competition in the
Omaha banking market.
FNLC's subsidiary bank, Lincoln Bank, operates in
the Lincoln, Nebraska, banking market, 5 and is the
largest banking organization in the market, controlling
48.2 percent of the total deposits in commercial banks
in the market. Because of Applicant's size and financial and managerial resources, the proximity of Lincoln to Omaha, and the relative size and importance of
the Lincoln market within the state, Applicant appears
to be a likely entrant into the Lincoln market absent
approval of this proposal. The three largest banking
organizations in the market control 82.2 percent of the
total deposits in commercial banks in the market, a
2. "Proposed Policy Statement of the Board of Governors of the
Federal Reserve System for Assessing Competitive Factors Under the
Bank Merger Act and the Bank Holding Company Act." 47 Federal
Register 9017 (March 3, 1982). Although the Board has not approved
the policy statement, it is using the policy guidelines in its analysis of
the effect of a proposal on probable future competition.
3. The Omaha banking market is approximated by the Omaha
RMA.
4. United States v. Marine Bancorporation, 418 U.S. 602, 630
(1974).
5. The Lincoln banking market is approximated by the Lincoln
RMA.
448
Federal Reserve Bulletin • May 1984
level viewed as highly concentrated under the Board's
guidelines. 6
In its evaluation of the competitive effects of bank
expansion proposals, the Board has previously indicated that thrift institutions have become, or at least
have the potential to become, major competitors of
banks, and has accorded considerable weight to the
competitive influence of thrift institutions. 7 This is due
to a significant expansion of the services that thrifts
may offer, particularly as a result of the enactment of
the Consumer Checking Account Equity Act of 1980,8
which authorized thrift institutions to offer NOW
accounts, the Garn-St Germain Depository Institutions Act of 1982,9 which greatly expanded the commercial lending powers of federal thrift institutions,
and various state statutes.
The Lincoln banking market contains six thrift institutions that control 33.8 percent of the total deposits in
banks and savings and loan associations in the market,
and operate 31 offices in the market (as compared to
the 15 commercial bank offices). The three largest
thrift institutions in the market are the first, third and
fifth largest depository institutions in Nebraska, and
each controls more than $500 million in deposits
statewide. The record shows that these and other thrift
institutions in Nebraska have extensive branch networks in the state; aggressively solicit transaction
accounts, time and savings accounts, and consumer
loans; and offer residential and commercial mortgages
and transaction accounts. In addition, federal thrift
institutions can accept demand deposits from business
customers with whom they have a lending relationship. Four of the six thrift institutions in Lincoln have
hired commercial lending officers and instituted commercial loan programs. While the commercial loan
portfolios of these institutions are not substantial at
the present time, this appears due to the fact that thrift
institutions have only recently obtained expanded
commercial lending powers. In any event, the record
establishes that thrift institutions in the Lincoln market are prepared and intend to expand their commercial lending operations.
In the Board's view, this evidence indicates that
thrift institutions should be given substantial weight in
determining concentration in the market.10
6. Market data are as of September 30, 1983.
7. First Railroad <£ Banking Company of Georgia, 70 FEDERAL
RESERVE BULLETIN 436, (Press Release dated April 16, 1984); NBD
Bancorp, Inc. (Pontiac State Bank), 69 FEDERAL RESERVE BULLETIN
917; Comerica (Pontiac State Bank), 69 FEDERAL RESERVE BULLETIN
911; General Bancshares Corporation,
69 FEDERAL RESERVE BULLE-
TIN 802; Comerica (Bank of the Commonwealth), 69 FEDERAL RESERVE BULLETIN 797; and First Tennessee National Corporation, 69
The Board's proposed market extension guidelines
state that, where there are more than six probable
future entrants into a market, the elimination of an
applicant as a potential competitor is not likely to have
an adverse effect on probable future competition.
When it issued the guidelines, the Board stated that
the number of probable future entrants specified in the
guidelines was intended to be used only as a general
standard, because no single number of entrants could
be used as a true indicator in all circumstances. The
Board was aware that the structure of a particular
market and the limitations on expansion imposed by
state law would have to be considered with regard to
each case.
The Board notes that there are only five banking
organizations with assets over $500 million in the State
of Nebraska. Two of these are located in the Lincoln
market, leaving only three, including Applicant, that
meet the Board's definition of probable future entrant
contained in the guidelines. Nevertheless, Nebraska
has seven banking organizations with assets of less
than $500 million, but more than $100 million, that
appear to have the financial and managerial resources
necessary to enter the Lincoln banking market. While
these organizations have fewer deposits than specified
in the guidelines to be considered probable future
entrants, in light of the relatively small size of Nebraska banking organizations generally and recent amendments to Nebraska law that expand branching opportunities and allow the formation of multibank holding
companies, 11 the Board believes that these organizations represent probable future entrants into the Lincoln market.
Finally, to the extent that thrift institutions are not
considered existing competitors of commercial banks,
they would, based upon their power to offer many of
the products and services offered by commercial
banks, be viewed as potential entrants into the commercial banking product market, where, as here, they
have evidenced the intent to provide commercial
banking services.
Accordingly, based on all the evidence of record,
including the actual and potential competition offered
by thrift institutions and the structure of banking in
Nebraska, the Board concludes that consummation of
this acquisition would not have such adverse effects on
probable future competition in the Lincoln banking
market as to warrant denial of the proposal.
The financial and managerial resources of Applicant, FNLC, and their subsidiary banks, are satisfactory and their future prospects appear favorable. Consummation of the transaction would enable each of
FEDERAL RESERVE B U L L E T I N 2 9 8 ( 1 9 8 3 ) .
8. Title III, 94 Stat. 132, 145 codified at 12 U.S.C. § 1832.
9. Title III, 97 Stat. 1469, 1499-1500.
10. If only 50 percent of the deposits held by thrift institutions were
included in the calculation of market concentration, the share of
deposits held by the three largest depository institutions in the market
would be 67 percent and the market would not be considered highly
concentrated under the Board's guidelines.
11. Neb. Rev. Stat. §§ 8-903 and 8-157 (1983 Supp.).
Legal Developments
those institutions to increase and improve their services to their customers. Specifically, the combined
organization would have a higher lending limit, and
Applicant states that the affiliation would result in
lower credit costs at both institutions. Also, consummation of the proposal would result in the addition of
tax and leasing expertise to Lincoln Bank's staff and
farm management expertise to Omaha Bank's staflF.
Accordingly, considerations relating to the convenience and needs of the community to be served are
consistent with approval of the applications. Based on
the foregoing and other facts of record, the Board has
determined that consummation of the proposed transaction would be consistent with the public interest and
that the application should be approved.
On the basis of the record, these applications are
approved for the reasons summarized above. The
acquisition of shares and merger of bank holding
companies shall not be made before the thirtieth
calendar day following the effective date of this Order,
or later than three months after the effective date of
this Order, unless such period is extended by the
Board or by the Federal Reserve Bank of Kansas City,
acting pursuant to delegated authority.
By order of the Board of Governors, effective
April 24, 1984.
Voting for this action: Governors Martin, Wallich, Partee,
Rice, and Gramley. Absent and not voting: Governor
Teeters. Voting against this action: Chairman Volcker.
JAMES MCAFEE,
[SEAL]
Associate
Secretary of the Board
Norris Bancorp, Inc.
St. Charles, Illinois
Order Approving Acquisition
of a Bank
Norris Bancorp, Inc., St. Charles, Illinois, a bank
holding company within the meaning of the Bank
Holding Company Act of 1956, as amended,
(12 U.S.C. § 1841 et seq.), has applied for the Board's
approval pursuant to section 3(a)(3) of the Act
(12 U.S.C. § 1842(a)(3)), to acquire First National
Bank of Batavia, Batavia, Illinois.
Notice of the application, affording interested persons an opportunity to submit comments, has been
given in accordance with section 3(b) of the Act. The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the factors set forth in section 3(c) of
the Act.
Applicant controls one banking subsidiary, the State
Bank of St. Charles, the 254th largest commercial
449
banking organization in Illinois, with aggregate deposits of $66.7 million, representing less than 1 percent of
the total deposits in commercial banks in the state. 1
Bank is the 478th largest banking organization in
Illinois, with deposits of $38.7 million. Upon consummation of the proposed transaction, Applicant would
control less than 1 percent of the total deposits in
commercial banks in Illinois. Accordingly, consummation of this transaction would have no significant effect
on the concentration of banking resources in the state.
Applicant is the fifth largest of 24 commercial banking organizations that operate in the Aurora banking
market,2 controlling 6.5 percent of total deposits in
commercial banks in the market. Bank is the ninth
largest commercial banking organization in the Aurora
banking market, controlling 3.8 percent of total deposits in commercial banks in the market. Upon consummation of the proposed transaction, Applicant would
become the third largest banking organization in the
Aurora banking market and would control 10.3 percent
of the total deposits in commercial banks in the
market.
Although this proposal would result in the elimination of some existing competition in the Aurora banking market, several factors mitigate the competitive
effects of the proposal. The Aurora banking market is
not concentrated, with the four largest commercial
banking organizations controlling 44.8 percent of total
deposits in commercial banks in the market. In addition, numerous other banking alternatives will remain
in the market after consummation of the proposal.
Accordingly, the Board concludes that consummation
of the proposed transaction will not have a significant
effect on existing competition in the Aurora banking
market.
The financial and managerial resources of Applicant, its subsidiaries, and Bank are generally satisfactory and their future prospects are favorable. Moreover, Applicant has committed to inject enough capital
into Bank to increase Bank's capital to the minimum
levels set by the Board. Although Applicant does not
anticipate any immediate changes in the services offered by Bank, considerations relating to the convenience and needs of the community to be served are
consistent with approval.
On the basis of the record, the application is approved for the reasons summarized above. The transaction shall not be made before the thirtieth day
following the effective date of this Order or later than
three months after the effective date of this Order,
unless such period is extended for good cause by the
1. All banking data are as of June 30, 1983.
2. The Aurora banking market is approximated by the southern
portion of Kane County; Piano, Bristol, Oswego, Fox, and Kendall
townships in Kendall County; and Sandwich Township in DeKalb
County, all in Illinois.
450
Federal Reserve Bulletin • May 1984
Board or by the Federal Reserve Bank of Chicago,
acting pursuant to delegated authority.
By order of the Board of Governors, effective
April 12, 1984.
Voting for this action: Vice Chairman Martin and Governors Wallich, Partee, Rice, and Gramley. Absent and not
voting: Chairman Volcker and Governor Teeters.
JAMES MCAFEE,
[SEAL]
Associate
Secretary of the Board
Paducah Bank Shares, Inc.
Paducah, Kentucky
Order Approving
Company
Formation of a Bank Holding
Paducah Bank Shares, Inc., Paducah, Kentucky, has
applied for the Board's approval under section 3(a)(1)
of the Bank Holding Company Act (12 U.S.C.
§ 1842(a)(1)) ("Act") to become a bank holding company by acquiring 80 percent or more of the voting
shares of Paducah Bank & Trust Company, Paducah,
Kentucky ("Bank").
Notice of the application, affording opportunity for
interested persons to submit comments and views, has
been given in accordance with section 3(b) of the Act.
The time for filing comments and views has expired,
and the Board has considered the application and all
comments received in light of the factors set forth in
section 3(c) of the Act (12 U.S.C. § 1842(c)).
Applicant is a nonoperating corporation organized
for the purpose of becoming a bank holding company
by acquiring Bank, which holds deposits of $73.2
million. Upon consummation of the proposal, Applicant would control the 54th largest commercial bank in
Kentucky and would hold 0.38 percent of the total
deposits in commercial banks in the state. 1
Bank is the third largest of seven banks in the
McCracken County banking market and holds 12.4
percent of total deposits in commercial banks in the
market.2 Applicant's proposal is essentially a corporate reorganization, consummation of which would not
result in any adverse affects upon competition or in an
increase in the concentration of banking resources in
any relevant market.
The financial and managerial resources of Applicant
and Bank are considered to be generally satisfactory,
and their future prospects appear favorable. Applicant
does not propose to make any specific changes in the
1. Banking data are as of September 30, 1983.
2. The McCracken County banking market is defined as
McCracken County, Kentucky, and Massac County, Illinois.
services currently provided by Bank. However, there
is no evidence that the banking needs of the community to be served are not being met. Accordingly,
considerations relating to the convenience and needs
of the community to be served are consistent with
approval of this proposal.
Based on the foregoing and the record of this
application, it is the Board's judgment that the proposed acquisition is in the public interest and that the
application should be approved and hereby is approved for the reasons summarized above. 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 Board or the Federal Reserve Bank of St.
Louis, acting pursuant to delegated authority.
By order of the Board of Governors, effective
April 6, 1984.
Voting for this action: Governors Wallich, Partee, Rice,
and Gramley. Absent and not voting: Chairman Volcker and
Governors Martin and Teeters.
JAMES MCAFEE,
[SEAL]
Associate
Secretary
of the Board
Salem Capital Corp.
Elkhart, Indiana
Order Approving Formation of a Bank
Company
Holding
Salem Capital Corp., Elkhart, Indiana, has applied for
the Board's approval, pursuant to section 3(a)(1) of the
Bank Holding Company Act (12 U.S.C. § 1842(a)(1)),
to become a bank holding company by acquiring 44
percent of the voting stock of Salem Financial Corporation, Goshen, Indiana ("Salem Financial"), a bank
holding company within the meaning of the Act, and
thereby indirectly acquiring Salem Bank and Trust
Company, Goshen, Indiana ("Bank").
Notice of the application, affording opportunity for
interested persons to submit comments and views, has
been given in accordance with section 3(b) of the Act.
The time for filing comments has expired, and the
Board has considered the application and all comments received in light of the factors set forth in
section 3(c) of the Act (12 U.S.C. § 1842(c)).
Applicant is a nonoperating corporation organized
to acquire Bank, which is the 31st largest commercial
bank in Indiana with deposits of $157.5 million, representing 0.56 percent of total deposits in commercial
banks in the state. 1 Consummation of this proposal
1. Banking data are as of June 30, 1982.
Legal Developments
will have no significant effects on the concentration of
banking resources in the state.
Bank operates in the Elkhart-Niles-South Bend
banking market, where it is the sixth largest of 30
commercial banks, controlling 6.1 percent of total
deposits in commercial banks in the market. 2 Neither
Applicant nor any of its principals has an ownership
interest in any other banking organization in the market, and it appears that consummation of this proposal
will have no significant effects on competition or
increase the concentration of banking resources in any
relevant area.
The financial and managerial resources of Applicant, Salem Financial, and Bank are considered to be
generally satisfactory, and their future prospects appear favorable. Applicant has proposed no new activities or services for Bank upon consummation of this
proposal. However, there is no evidence indicating
that the needs of the community to be served are not
being met. Accordingly, considerations relating to the
convenience and needs of the community to be served
are consistent with approval of this proposal.
Based on the foregoing and the record of this
application, the Board has determined that this proposal should be and hereby is approved. The transaction shall not be consummated before the thirtieth
calendar day following the effective date of this Order,
nor later than three months after the effective date of
this Order, unless such period is extended for good
cause by the Board or by the Federal Reserve Bank of
Chicago, acting pursuant to delegated authority.
By order of the Board of Governors, effective
April 5, 1984.
Voting for this action: Governors Wallich, Partee, Rice,
and Gramley. Absent and not voting: Chairman Volcker and
Governors Martin and Teeters.
JAMES MCAFEE,
[SEAL]
Associate
Secretary of the Board
Sturm Investment, Inc.
Omaha, Nebraska
Order Approving Formation of a Bank Holding
Company
Sturm Investment, Inc., Omaha, Nebraska, has applied for the Board's approval under section 3(a)(1) of
the Bank Holding Company Act of 1956, as amended,
2. The Elkhart-Niles-South Bend banking market is defined as all of
CaSs County, Michigan, the townships of Berrien, Oronoko, Buchanan, Niles, and Bertrand in Berrien County, Michigan, all of Elkhart
County, Indiana, and all of St. Joseph County, Indiana, except for the
townships of Warren and Olive.
451
(the "Act") (12 U.S.C. § 1842(a)(1)) to form a bank
holding company by acquiring 95 percent of the voting
shares of The Union National Bank of Macomb,
Macomb, Illinois ("Bank").
Notice of the application, affording opportunity for
interested persons to submit comments, has been
given in accordance with section 3(b) of the Act. The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the factors set forth in section 3(c) of
the Act.
Applicant is a nonoperating Nebraska corporation
organized for the purpose of becoming a bank holding
company by acquiring Bank, which holds deposits of
$54.8 million.1 Bank is the second largest of seven
commercial banking organizations competing in the
McDonough County banking market2 and holds 28.5
percent of total deposits in commercial banks in the
market. Upon acquisition of Bank, Applicant would
control the 309th largest commercial banking organization in Illinois and approximately 0.06 percent of total
deposits in commercial banks in the state.
This proposal involves a restructuring of Bank's
ownership from an individual to a corporation controlled by the same individual. Applicant's principal,
who owns 95 percent of the outstanding shares of
Bank, also owns 51 percent of the outstanding voting
shares of First National Bank of Macomb, Macomb,
Illinois ("First"), which is located five road miles from
Bank. First, with deposits of $9.4 million, also competes in the McDonough County banking market
where it is the fifth largest banking organization,
controlling 4.9 percent of total deposits in commercial
banks in the market.
Section 3(c) of the Act precludes the Board from
approving any proposed acquisition that may tend to
create a monopoly or may substantially lessen competition or be in restraint of trade in any part of the
United States, unless the Board finds that such anticompetitive effects are clearly outweighed by the
convenience and needs of the community to be served.
In analyzing a case under these standards where, as
here, a principal of an applicant controls another
banking organization in the same market as the bank to
be placed in the holding company, the Board considers
the competitive effects of the transaction whereby
common control of the formerly competing institutions
was established. 3
In this instance, the two banks had been affiliated
since the de novo establishment of First by the original
1. All banking data are as of December 31, 1982.
2. The McDonough County banking market is approximated by all
of McDonough County, Illinois.
3. See Mid Nebraska Bancshares, Inc. v. Board of Governors, 627
F.2d 266 (D.C. Cir. 1980).
452
Federal Reserve Bulletin • May 1984
principals of Bank in 1964. First provided an additional
source of banking services in the market; thus, its
establishment can be viewed as procompetitive. In
1983, Applicant's principal acquired control of Bank
and First from the common principals of both institutions. Because the affiliation of Bank and First was not
anticompetitive at its inception, their acquisition by
Applicant's principal is not viewed as anticompetitive.
Accordingly, the Board concludes competitive considerations are consistent with approval.
The financial and managerial resources and future
prospects of Applicant and Bank appear to be generally satisfactory, particularly in light of commitments by
Applicant. Convenience and needs of the community
to be served are also consistent with approval. Accordingly, it is the Board's judgment that the proposed
acquisition is in the public interest and that the application should be approved.
On the basis of the record, the application is approved for the reasons summarized above. The transaction shall not be consummated before the thirtieth
calendar day following the effective date of this Order
or later than three months after the effective date of
this Order, unless such period is extended for good
cause by the Board or by the Federal Reserve Bank of
Chicago acting pursuant to delegated authority.
By order of the Board of Governors, effective
April 4, 1984.
Voting for this action: Governors Wallich, Partee, Rice,
and Gramley. Absent and not voting: Chairman Volcker and
Governors Martin and Teeters.
WILLIAM W . WILES,
[SEAL]
Secretary of the Board
Orders Issued Under Section 4 of Bank Holding
Company Act
Manufacturers Hanover Corporation
New York, New York
Order Approving
Company
the Acquisition
of Nonbank
Manufacturers Hanover Corporation, New York,
New York, a bank holding company within the meaning of the Bank Holding Company Act, has applied for
the Board's approval under section 4(c)(8) of the Act
(12 U.S.C. § 1843(c)(8)) to acquire all of the voting
shares of CIT Financial Corporation, New York, New
York ("CIT"). CIT engages through sixty-one subsidiaries operating throughout the United States in factoring, commercial and industrial lending, mortgage
banking, consumer finance, leasing, sales financing,
credit servicing, and community development activi
ties. In addition, CIT operates industrial banks in
California, Hawaii, Iowa, Kentucky, Tennessee,
Washington, and West Virginia,1 and acts throughout
the United States as agent or broker for the sale of
credit-related life, accident and health, and disability
insurance. CIT also acts as broker for property and
casualty insurance related to extensions of credit by its
consumer financing subsidiaries in 44 states. 2
Manufacturers Hanover Corporation has also applied for the Board's approval under section 25(a) of
the Federal Reserve Act ("Edge Act") to acquire all of
the outstanding voting shares of CIT Holdings Inc.,
and Service Leasing Corporation of Canada, Limited,
both of Toronto, Ontario, Canada. Finally, Manufacturers Hanover Corporation has provided notice,
under section 4(c)(14) of the Act (12 U.S.C.
§ 1843(c)(14)), of its intention to acquire all of the
outstanding shares of CIT International Sales Corporation, New York, New York, an export trading
company.
Notice of the application, affording interested persons an opportunity to submit comments and views,
has been duly published (49 Federal Register 4147
(1984)). The time for filing comments has expired, and
the Board has considered the application and the
notice and all comments received in light of the factors
specified in section 4 of the Act and the purposes of
the Edge Act.
Applicant, with consolidated assets of approximately $64.3 billion, is the third largest commercial banking
organization in New York and operates three bank
subsidiaries, including Manufacturers Hanover Trust
Company, which controls $42.2 billion in deposits. 3
Applicant engages, through seven nonbank subsidiaries operating in 33 states, in various permissible nonbanking activities, including commercial finance, leasing, mortgage banking, factoring, consumer finance,
credit-related insurance agency activities, and nondepository trust company activities.
Permissible Nonbanking Activities. CIT, with total
assets of $6.2 billion, is one of the largest diversified
finance companies in the United States, operating 275
consumer finance offices and 48 commercial finance
1. CIT Financial Corporation states that the industrial banks that it
owns and operates do not accept deposits and are not eligible for
FDIC insurance. Applicant has committed that, after consummation
of the proposed acquisition, these industrial banks will not accept
deposits. Accordingly, the Board has determined that this portion of
the application is subject to section 4 of the Act.
2. CIT also owns all of the voting shares of North American
Company for Life and Health Insurance, which acts as an underwriter
for life and accident and health insurance, and North American
Company for Property and Casualty Insurance, which acts as an
underwriter for property and casualty insurance. Applicant will not
acquire these companies, both of which will be acquired by RCA.
3. All financial data are as of December 31, 1983.
Legal Developments
offices in 44 states. CIT's factoring, consumer finance,
commercial and industrial finance, mortgage banking,
sales financing, credit servicing, leasing, industrial
banking, credit-related life, accident and health, and
disability insurance agency, and community development activities have been determined by the Board to
be closely related to banking and are permissible for
bank holding companies. 4
As discussed below, the Board also concludes that
Applicant may, under section 225.25(b)(8)(i) of Regulation Y and section 4(c)(8)(D) of the Act, sell property
and casualty insurance in connection with extensions
of credit by consumer finance subsidiaries of CIT in
the 27 states in which the consumer finance subsidiary
of Applicant is authorized to conduct this activity and
in other states up to the limits specified in section
4(c)(8)(B) of the Act. Finally, the Board concludes that
CIT's tuition budget plan, under which CIT receives
periodic payments from parents of students and disburses the funds received to designated educational
institutions as tuition bills come due, is closely related
to banking and a proper incident thereto because it is
operationally and functionally equivalent to an escrow
account or bill payment service commonly provided
by banking institutions.
In acting on an application under section 4(c)(8) of
the Act, the Board must consider whether Applicant's
performance of the proposed activities "can reasonably be expected to produce benefits to the public,
such as greater convenience, increased competition,
or gains in efficiency, that outweigh possible adverse
effects, such as undue concentration of resources,
decreased or unfair competition, conflicts of interest,
or unsound banking practices." This consideration
also requires an evaluation of the financial and managerial aspects associated with the proposal. 12 CFR
§ 225.24.
Financial Factors. The Board views with concern any
proposal involving a major expenditure of funds for
expansion that could limit a bank holding company's
ability to serve as a source of strength to its subsidiary
banks, particularly its ability to raise new equity
capital to deal with unforeseen difficulties. Thus, in
evaluating this application, the Board has carefully
4. 12 CFR § 225.25(b)(1), (2), (5), (6), and (8). CIT currently is the
owner-lessor under 13 personal property leases that do not conform to
the requirements of section 225.25(b)(5) of the Board's Regulation Y.
These leases represented a total investment of approximately $9
million as of October 31, 1983, and the latest termination date of these
leases is year-end 1987. Applicant has committed that, in the event of
Board approval of the proposed acquisition, Applicant would conform
these leases to the requirements of Regulation Y by year-end 1987 and
would limit the future leasing activities of CIT and its subsidiaries to
leases that conform to the requirements of the Board's Regulation Y.
453
considered the financial and managerial resources of
Manufacturers Hanover Corporation, including its
capital position and data on its domestic and foreign
loan portfolio, and the effect on these resources of the
proposed acquisition of CIT. The Board has stated and
continues to believe that capital adequacy is an especially important factor in the analysis of bank holding
company expansion proposals, particularly where significant acquisitions are proposed or where the organization has a significant loan exposure. In evaluating
capital, the Board will consider, among other factors,
the implications of a significant level of intangible
assets, including that arising from a proposed expansion. The Board will also consider the capitalization of
the acquired company—relative to the accepted norm
for companies in the same industry—and whether that
capitalization is adequately reflected in the consolidated primary capital of the applicant.
While the Board notes that there is a material
amount of intangible assets involved in this acquisition
and that finance companies are normally more highly
capitalized than banks, the Board believes that this
proposal meets acceptable standards in light of the
steady and substantial improvement in Applicant's
capital ratios and its plans for still further strengthening of its capital position. The Board notes that, in
connection with the proposed acquisition, Applicant
has committed to raise more than $500 million of
additional primary capital; and in fact has already
raised approximately $200 million in common stock
since year-end 1983. Substantially all of the balance of
this capital commitment will be raised simultaneously
with consummation of this proposal. Moreover, subsequent to year-end 1983, Applicant raised an additional
$100 million in equity commitment notes. Upon consummation of this transaction, Applicant's pro forma
capital position will be significantly above the minimum ratio for multinational organizations. Furthermore, Applicant has committed to maintain its capital
position at at least this level and has presented the
Board with a plan under which Applicant will take
steps toward a significant further strengthening of its
capital position.
The Board also notes that CIT is a strong domestic
competitor in a number of product lines and that its
financial and managerial resources and future prospects are satisfactory, as indicated by CIT's historic
above average capital position and earnings record.
While the investment is not without risk in view of the
growing competition in the financial services markets
served by CIT, the Board believes that, on balance,
the acquisition of CIT by Applicant should strengthen
and result in a desirable diversification of Applicant's
overall financial resources. The Board also notes that
the financing for the proposed acquisition is made up
in large part by the issuance to the seller of new
454
Federal Reserve Bulletin • May 1984
primary capital of Applicant and acquisition debt that
has been structured to minimize future financing
risks.5
Taking into account these factors and all of the facts
of record, the Board concludes that any adverse
effects of consummation of this proposal on the financial and managerial resources of Applicant would not
be significant and that consummation of this proposal
would be consistent with the Board's policy that a
bank holding company maintain its ability to serve as a
source of financial strength to its subsidiary banks.
Competitive Considerations. Applicant and CIT are
both among the nation's largest providers of financial
services to individuals and businesses and both offer
consumer finance, factoring, commercial finance, and
leasing products and services within national, regional, and local geographic markets. Applicant is the fifth
largest factor in the United States, with 6.1 percent of
the national market.6 CIT ranks as the largest factor in
the nation, controlling 15.6 percent of the national
factoring market. The market for factoring is unconcentrated, with a Herfindahl-Hirshman Index ("HHI"),
upon consummation of the proposed acquisition, of
only 819 and a four-firm concentration ratio of 44.7
percent. Moreover, there are a large number of existing and potential competitors in the factoring business.
Applicant also engages in leasing real and personal
property, and is the second largest leasing firm in the
nation, with approximately 1.7 percent of the nationwide leasing business. CIT is the 13th largest leasing
firm in the nation, controlling only 0.4 percent of the
nationwide leasing business. The market for the leasing activities of Applicant and CIT is unconcentrated
with an HHI below 50; and there are also numerous
existing and potential competitors in the leasing business.
Applicant and CIT both engage in various commercial finance company activities throughout the United
States. The geographic market for this activity is
regional in scope, and the combined market shares of
Applicant and CIT in each of the regions where they
both compete is less than 4 percent. Moreover, there
are numerous existing and potential competitors in
these markets.
Applicant and CIT also both engage in consumer
finance activities in numerous markets throughout the
United States. The Board has previously determined
5. Applicant has financed $800 million of the purchase price in fixed
rate debt held by the seller.
6. The Board has previously determined that the factoring market is
a nationwide market. Barclays Bank Limited, 66 FEDERAL RESERVE
BULLETIN 9 8 0 ( 1 9 8 0 ) .
that the relevant geographic market for consumer
finance activities is approximated by the local banking
market and the relevant product market is the making
of personal cash loans. 7 Consumer finance subsidiaries of Applicant and CIT compete with each other in 83
local banking markets in 31 states. In all but five of
these markets, the market share of Applicant and CIT
is small and their combined market share would be less
than 10 percent.
The five markets in which Applicant's and CIT's
combined market share would exceed 10 percent are
the metropolitan New York market; Tampa, Florida;
Houma, Louisiana; Charleston, South Carolina; and
Danville, Virginia, markets. The metropolitan New
York market and the Tampa, Florida market are
unconcentrated, and CIT's market share in consumer
finance activities in each of these two markets is less
than one percent. In the other three markets, the
combined market share for Applicant and CIT would
be 16.5 percent, 18.8 percent, and 12.0 percent, respectively. However, each of these three markets is
unconcentrated and would remain unconcentrated after consummation of the proposal, with an HHI below
600 after giving effect to the proposed acquisition in
each of these markets. In each of the 83 markets in
which Applicant and CIT compete, there are a large
number of existing and potential competitors. The
Board also notes that in many of these markets the
consumer finance activities of CIT primarily involve
mobile home and home equity financing, while the
consumer finance activities of Applicant involve primarily making personal cash loans.
While Applicant and CIT also both engage in mortgage banking, community development, and creditrelated insurance activities, the relevant market shares
of Applicant and CIT are not significant. Based upon
the foregoing and all of the facts of record, the Board
concludes that consummation of the proposal will not
have any significant adverse effects on existing or
potential competition in any relevant product line or
geographic market.
Concentration of Resources.
This proposal would
result in the affiliation of one of the nation's largest
commercial banking organization with one of the nation's larger finance companies. Accordingly, the
Board has considered whether the proposal would
result in an undue concentration of resources in the
financial services industry or in any relevant line of
commerce, particularly in the provision of nationwide
factoring and consumer finance services. The financial
7. See, e.g., Norwest
LETIN 519, 520 (1982).
Bancorporation,
68 FEDERAL RESERVE BUL-
Legal Developments
services industry in general and each of the product
lines in which CIT and Applicant specifically compete
are highly competitive. Moreover, the barriers to entry
in each of these product lines are not substantial, and
there are, as noted above, a large number of potential
entrants into each activity. The Board also notes that,
while this proposal would result in Applicant becoming one of the larger competitors in several product
lines, there will remain numerous other large and
capable competitors in each of these product lines,
including some of the largest business organizations in
the country. Accordingly, based on all the facts of
record, the Board believes that the proposed acquisition will not result in an undue concentration of
resources.
Permissibility of credit-related property and casualty
insurance activities. Applicant seeks authority for CIT
to engage in the sale of credit-related property and
casualty insurance through CIT's consumer finance
subsidiaries. In 1972, the Board determined that the
sale by a bank holding company of property and
casualty insurance to protect collateral securing an
extension of credit by a subsidiary of the bank holding company was closely related to banking and permissible for bank holding companies. 12 CFR
§§ 225.25(b)(8) and 225.128. However, the Garn-St
Germain Depository Institutions Act of 1982 ("GarnSt Germain Act") provided that the sale of creditrelated property and casualty insurance was not closely related to banking except under certain specified
circumstances.
Under one of these exceptions, a finance company
subsidiary may act as agent or broker for property and
casualty insurance directly related to an extension of
credit by the finance company of not more than
$10,000 ($25,000 for mobile home loans) (12 U.S.C.
§ 1843(c)(8)(B)). Accordingly, consistent with the
Garn-St Germain Act and the Board's Regulation Y,
the Board concludes that Applicant may sell creditrelated property and casualty insurance at CIT's consumer finance subsidiaries subject to these dollar
limitations at any geographic location in the country.
CIT currently provides property and casualty insurance related to extensions of credit in excess of the
dollar limits stipulated in the finance company exception. Accordingly, Applicant seeks a Board ruling that
CIT's consumer finance offices may continue to sell
credit-related property and casualty insurance in reliance on the grandfather rights of Applicant's existing
consumer finance subsidiary under another section of
the Garn-St Germain Act (12 U.S.C. § 1843(c)(8)(D)).
This exception, codified in section 4(c)(8)(D) of the
Bank Holding Company Act, provides an exception to
the insurance prohibitions of the Garn-St Germain Act
for insurance agency activities engaged in by a bank
455
holding company or any of its subsidiaries on May 1,
1982. Under this exemption, Applicant's consumer
finance subsidiary, Manufacturers Hanover Financial
Services, Inc. ("MHFS"), may sell credit-related
property and casualty insurance at any location in 27
states: the 22 states in which MHFS engages in that
activity and was so engaged on May 1, 1982, the
grandfather date, 8 as well as in New York, Applicant's
home state, and the states adjacent to New York.
It is clear from the terms and legislative history of
this exception (section 4(c)(8)(D) of the Act) that, if
MHFS were to acquire CIT's consumer finance offices
in these 27 states, MHFS would not be prohibited by
the Garn-St Germain Act from selling credit-related
property and casualty insurance at these offices. The
Board does not believe that a different result should
pertain where the parent holding company of the
grandfathered subsidiary acquires these same offices
directly, as is proposed in this case. There is no
increase in the number of states in which the grandfathered activity is conducted, nor is the grandfathered
activity being extended to a subsidiary engaged in a
different activity. Property and casualty insurance will
be sold only in connection with extensions of credit by
CIT's consumer finance subsidiaries. In this connection, the Board notes that the Conference Report
regarding Title VI of the Garn-St Germain Act states
that "nothing in this title is intended to prevent the
transferring of grandfathered insurance activities of a
bank holding company to the parent or any of its
subsidiaries if the transferral is brought about for
management or efficiency purposes." H. Rep. No. 97899, 97th Cong., 2d Sess. 91 (1982). Accordingly, the
Board concludes that Applicant may engage through
CIT's consumer finance subsidiaries in the sale of
credit-related property and casualty insurance at any
location within the 27 states in which MHFS may
engage in that activity.
The Applicant claims that, in addition to these 27
states, CIT may sell credit-related property and casualty insurance in any other of the remaining 23 states
under section 4(c)(8)(D) of the BHC Act because a
mortgage banking subsidiary of Applicant sold creditrelated life insurance throughout the United States on
May 1, 1982. CIT currently sells credit-related property and casualty insurance in 15 of these 23 states.
Applicant's claim raises several issues concerning the
scope of the exemption provided in section 4(c)(8)(D),
issues that the Board has specifically requested public
comment on in connection with its March 2, 1984
8. These states are Alabama, Arizona, California, Colorado, Florida, Georgia, Indiana, Kansas, Louisiana, Maryland, Mississippi,
Missouri, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania,
South Carolina, Tennessee, Texas, Washington, and West Virginia.
456
Federal Reserve Bulletin • May 1984
notice of rulemaking regarding that section. (49 Federal Register 9215 (March 12, 1984)). The Board believes
it appropriate to defer ruling on Applicant's claim until
the conclusion of that rulemaking, and Applicant has
agreed to conform its activities to the results of the
rulemaking and not to expand CIT's existing creditrelated property and casualty activities during the
pendency of the rulemaking other than as authorized
by this Order. For these same reasons, the Board has
determined to consider in the context of the Board's
general rulemaking regarding the extent of permissible
insurance activities under the Garn-St Germain Act
whether Applicant may act as agent for noncreditrelated life insurance sold in connection with CIT's
tuition budget plan.
Based on all the facts of record, the Board believes
that consummation of the proposal would not result in
conflicts of interests, unsound banking practices, unfair competition or other adverse effects on the public
interest. Applicant has stated that it will provide
support, encouragement, and resources to CIT to
enable CIT to expand its existing operations and
develop new products, including the expansion of
CIT's lending products in both commercial and consumer markets, thereby enabling CIT to offer a more
complete range of services to its customers. Moreover, Applicant expects that this acquisition will enhance the ability of both Applicant and CIT to compete more aggressively in the consumer finance area as
well as in providing credit to small and medium sized
businesses. In this regard, Applicant has informed the
Board that it intends to reverse the recent withdrawal
by CIT from small cash consumer lending and instead,
with the assistance of subsidiaries of Applicant that
currently conduct an extensive direct cash loan business, expand the direct cash personal loan business of
CIT. Applicant also states that, with its support, CIT
will expand its other consumer lending products, such
as home equity financing, mortgage loans, and other
secured and nonsecured credit facilities of CIT, as well
as continue to supply credit needs in the larger item
sales finance market. This should increase competition
and benefit the customers of both Applicant and CIT.
In addition, Applicant intends to combine its own
expertise and extensive international contacts with the
extensive contacts of CIT with domestic manufacturers in order to expand exports of these manufacturers
through a CIT export trading company as well as
through other facilities of Applicant. Applicant also
anticipates that consummation of this proposal will
increase operational and management efficiency
through the consolidation of operations and support
facilities. Accordingly, the Board concludes that the
balance of public interest factors that it must consider
under section 4(c)(8) of the Act is consistent with
approval of this proposal.
The financial and managerial resources of Manufacturers Hanover Corporation are also consistent with
approval of the applications under the Edge Act. The
Board has also considered the notice of Applicant's
proposed investment in CIT International Sales Corporation under section 4(c)(14) of the Bank Holding
Company Act. Based on the facts of record, including
the capital to assets ratio of the export trading company, the Board has determined that disapproval of the
proposed investment is not warranted.
Based on the foregoing and all the facts of record,
the Board has determined that these applications
should be, and hereby are, approved. These transactions shall not be consummated later than three
months after the effective date of this Order unless the
period for consummation is extended for good cause
by the Board or by the Federal Reserve Bank of New
York under delegated authority. This determination is
subject to the conditions stated herein as well as all of
the conditions set forth in Regulation Y, including
sections 225.4(d) and 225.23(b), and to the Board's
authority to require such modification or termination
of the activities of a holding company or any of its
subsidiaries as the Board finds necessary to assure
compliance with, or to prevent evasion of, the provisions and purposes of the Act and the Board's regulations and orders issued thereunder.
By order of the Board of Governors, effective
April 24, 1984.
Voting for this action: Chairman Volcker, and Governors
Martin, Wallich, Partee, Rice, and Gramley. Governor Wallich abstained from the insurance portions of this application.
Absent and not voting: Governor Teeters.
JAMES MCAFEE,
[SEAL]
Associate
Secretary
of the Board
Union Financial Corporation
Manhattan, Kansas
Order Approving Application to Engage in Lending,
Loan Servicing, and Insurance
Activities
Union Financial Corporation, Manhattan, Kansas, a
bank holding company within the meaning of the Bank
Holding Company Act (12 U.S.C. §§ 1841 et seq.), has
applied for the Board's approval pursuant to section
4(c)(8) of the Act (12 U.S.C. § 1843(c)(8)) and section
225.21(a) of the Board's Regulation Y (12 CFR
§225.21(a)), to acquire 50 percent of the voting shares
of UNIFI, Manhattan, Kansas. The remaining 50 percent of UNIFI would be held by Professional Services,
Inc., Manhattan, Kansas ("PSI"). UNIFI proposes to
serve the credit needs of medical and other professionals by engaging de novo in the activities of directly
Legal Developments
extending credit to professionals, billing their accounts
and notes, purchasing their notes payable at a discount, collecting accounts and notes that were serviced or held by UNIFI prior to their delinquency, and
acting as agent for the sale of credit life, accident and
health insurance directly related to UNIFI's extensions of credit.1 These activities have been determined
by the Board to be closely related to banking and
permissible for bank holding companies. (12 CFR
§§ 225.25(b)(1), (8)(i)).
Notice of the application, affording interested persons an opportunity to submit comments, has been
duly published (48 Federal Register 56851 (1983)). The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the public interest factors set forth in
section 4(c)(8) of the Act.
Applicant controls one bank, Union National Bank
and Trust Company, Manhattan, Kansas ("Bank"),
which holds total deposits of $79.0 million, representing 0.5 percent of the total deposits in commercial
banks in the state. 2 Bank operates in the Riley County
banking market,3 where it is the second largest of
seven commercial banking organizations, controlling
29.7 percent of the total deposits in commercial banks
in the relevant market. Applicant has no nonbanking
subsidiaries. PSI, which has total assets of only
$11,000 as of August 31, 1983, is currently engaged in
loan servicing activities for professionals throughout
the United States. Upon consummation of this proposal, PSI would transfer its loan servicing activities to
UNIFI. 4
This proposal involves a de novo acquisition and
normally consummation of the transaction would not
have any adverse effects upon either existing or potential competition. However, in view of the fact that the
proposal involves the use of a joint venture between a
bank holding company and a nonbanking company,
the Board has analyzed the proposal with respect to its
effects on existing and potential competition between
Applicant and PSI in the relevant lending, loan servicing, and insurance markets. 5
1. UNIFI will not sell credit-related insurance in connection with
loans that it merely services. The sale of such insurance does not
appear to be permissible under Title VI of the Garn-St. Germain Act
of 1982 (12 U.S.C. § 1843(c)(8)(A)).
2. All banking data are as of June 30, 1983.
3. The Riley County banking market is approximated by Riley
County, Kansas.
4. After consummation of the proposal, PSI would have no remaining operating function, except for a contact lens sales and service
program that is currently in its developmental stages.
5. The Board has previously expressed concerns regarding the
potential for undue concentration of resources or other adverse effects
that result through the combination in a joint venture of banking and
nonbanking institutions. Deutsch Bank AG, 67 FEDERAL RESERVE
BULLETIN 449 (1981); BankAmerica Corporation, 60 FEDERAL RESERVE B U L L E T I N 5 1 7 ( 1 9 7 4 ) .
457
Applicant engages through Bank in lending and loan
servicing activities in the Riley County, Kansas, banking market. PSI is not engaged in lending activities.
Although PSI does currently engage in loan servicing,
PSI does not service the same base of customers that
Bank serves. Furthermore, PSI's nationwide service
area is much larger than Bank's limited service area
around Manhattan, Kansas. As mentioned above, all
of PSI's loan servicing activities would be transferred
to UNIFI upon consummation of the proposal. Applicant estimates that less than one percent of UNIFI's
business would be originated from Bank's service area
in and around Manhattan, Kansas. Accordingly, consummation of this proposal would have no significant
effects upon existing competition in any relevant
market.
With respect to potential competition, although Applicant and PSI could presumably engage in all of the
proposed activities alone (and PSI is, in fact, currently
engaged in loan servicing activities) the Board , does
not consider Applicant to be a likely independent
entrant into the specialized field of providing credit
and credit services to professionals, given the fact that
Applicant does not have a sufficient customer base to
justify the cost of independent entry into these activities. 6 The Board does not consider PSI to be a likely
independent entrant into the business of providing
credit to professionals because of its small size and
lack of access to additional capital resources through
which it could extend credit. In addition, because
barriers to entry into the lending and loan servicing
businesses are low, there are numerous potential entrants into the market. The loss of Applicant or PSI as
a potential entrant, therefore, would have little effect
on potential competition in the market. Accordingly,
the Board concludes that consummation of the proposed joint venture would not significantly decrease
competition in any market.
Consummation of the proposal may be expected to
result in public benefits inasmuch as UNIFI, a de novo
corporation, would allow for the continued availability
of the services now offered by PSI and would provide
an additional and convenient source of credit for
professionals. The financial and managerial resources
of Applicant, Bank, and UNIFI are considered satisfactory, and there is no evidence in the record to
indicate that consummation of the proposal would
result in undue concentration of resources, unfair
competition, conflicts of interests, unsound banking
practices, or other adverse effects on the public interest.
6. S e e , Southern
Bancorporation,
Inc.,
69 FEDERAL RESERVE
BULLETIN 224 (1983); Florida Coast Banks, Inc., 68 FEDERAL RESERVE BULLETIN 781 (1982); and Svenska
AL RESERVE B U L L E T I N 7 8 8 ( 1 9 8 2 ) .
Handelsbanken,
68 FEDER-
458
Federal Reserve Bulletin • May 1984
Based on the foregoing and other facts of record, the
Board concludes that the balance of the public interest
factors it must consider under section 4(c)(8) of the
Act favors approval of the application. Accordingly,
the Board has determined that the application should
be and hereby is approved. This determination is
subject to all 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 such
modification or termination of the activities of a bank
holding company or any of its subsidiaries as the
Board finds necessary to assure compliance with the
provisions and purposes of the Act and the Board's
regulations and orders issued thereunder, or to prevent evasion thereof.
The transaction shall be consummated not later than
three months after the elfective date of this Order,
unless such period is extended for good cause by the
Board or by the Federal Reserve Bank of Kansas City,
acting pursuant to delegated authority.
By order of the Board of Governors, effective
April 23, 1984.
Voting for this action: Vice Chairman Martin and Governors Wallich, Partee, Rice, and Gramley. Governor Wallich
abstained from the insurance portion of this application.
Absent and not voting: Chairman Volcker and Governor
Teeters.
JAMES MCAFEE,
[SEAL)
Associate
Secretary of the Board
Orders Issued Under Sections 3 and 4 of Bank
Holding Company Act
Allied Bancshares, Inc.
Houston, Texas
Order Approving Acquisition of Bank Holding
Companies, Banks and a Company to Engage in
Leasing Personal and Real Property
Allied Bancshares, Inc., Allied Fort Worth Bancshares, Inc., and Allied Austin Bancshares, Inc., all of
Houston, Texas (together referred to as "Applicant"),
bank holding companies within the meaning of the
Bank Holding Company Act ("Act") (12 U.S.C. § 1841
et seq.), have applied for the Board's approval under
section 3 of the Act to acquire: Texas United Bancorp,
Inc., Fort Worth, Texas ("Texas United"), and indirectly, its five subsidiary banks, Northeast National
Bank of Fort Worth, Richland Hills, Texas, First State
Bank, Bedford, Texas, American National Bank of
Dallas, Texas, Northwest Bank, Roanoke, Texas, and
Cedar Hill National Bank, Cedar Hill, Texas; NBC
Bancshares, Inc., Austin, Texas ("NBC"), and indirectly, its two subsidiary banks, National Bank of
Commerce, Austin, Texas, and National Bank of
Commerce-South, Austin, Texas; Collin Creek Bank,
N.A., Piano, Texas ("Collin"); and Allied Bank North
Central, N.A., Dallas, Texas, ("Allied Bank"), a
de novo bank.
Applicant has also applied for the Board's approval
under section 4(c)(8) of the Act (12 U.S.C.
§ 1843(c)(8)) and section 225.23(a) of the Board's
Regulation Y (12 CFR § 225.23(a)), to establish Allied
Bancshares Leasing Company, Houston, Texas ("Allied Leasing"), a de novo company which will engage
in leasing real and personal property. This activity has
been determined by the Board to be closely related to
banking and permissible for bank holding companies
(12 CFR § 225.25(b)(5)).
Notice of the applications, affording opportunity for
interested persons to submit comments, has been
given in accordance with sections 3 and 4 of the Act
(48 Federal Register 50615 (November 2, 1983)). 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 Act (12 U.S.C. § 1842(c)) and the considerations
specified in section 4(c)(8) of the Act.
Applicant proposes to acquire Texas United and
NBC through their merger into Allied Fort Worth
Bancshares, Inc., Houston, Texas, and Allied Austin
Bancshares, Inc., Austin, Texas, respectively, newly
established, wholly owned subsidiaries of Applicant.
Both mergers are to be accomplished through an
exchange of shares without Applicant assuming or
incurring additional debt. Applicant proposes to acquire Collin through a cash purchase of $4.9 million.
Applicant, the seventh largest banking organization
in Texas, controls 48 banking subsidiaries with aggregate deposits of $5.3 billion, representing 4.43 percent
of the total deposits in commercial banks in Texas. 1
Texas United is the 39th largest banking organization
in Texas, controlling aggregate deposits of $198.7
million, representing 0.16 percent of the total deposits
in commercial banks in the state. NBC is the 426th
largest banking organization in Texas, controlling aggregate deposits of $32.9 million, representing 0.03
percent of the total deposits in commercial banks in
Texas. Collin is the 975th largest banking organization
in Texas with aggregate deposits of $8.0 million,
representing 0.01 percent of the total deposits in
commercial banks in Texas.
1. All banking data are as of December 31, 1982.
Legal Developments
Upon consummation of the proposed transaction,
Applicant will control approximately $5,548 billion in
deposits, constituting approximately 4.63 percent of
deposits in commercial banks in the state. In view of
the small increase in Applicant's share of deposits in
commercial banks in the state and the fact the Applicant's rank in the state will remain the same upon
consummation of the proposed acquisitions, the Board
concludes that the proposed acquisitions would have
no adverse effects on the concentration of banking
resources in Texas.
Texas United currently operates in both the Dallas,
Texas, and Fort Worth, Texas, banking markets. 2 In
the Dallas market, Texas United operates two subsidiary banks and ranks 76th of the 133 banking organizations in the market. Its subsidiary banks hold $18.5
million in deposits, which represent 0.07 percent of
total deposits in commercial banks in the market.
Applicant, the eighth largest banking organization in
the Dallas market, operates six subsidiary banks that
hold $593.8 million in deposits, representing 2.36 percent of total deposits in commercial banks in the
market.
In the Fort Worth banking market, Texas United
operates three subsidiary banks, and ranks seventh of
the 43 banking organizations in the market. Texas
United's subsidiary banks hold $180.1 million in market deposits, representing 2.86 percent of the total
deposits in commercial banks in the market. Because
Applicant is not currently represented in the Fort
Worth banking market, this acquisition would produce
no significant adverse effect on existing competition
within this market. The Forth Worth banking market is
not highly concentrated under the Board's proposed
Potential Competition Guidelines, and, accordingly,
this acquisition would not result in any significant
adverse effects on potential competition in this market.
NBC competes in the Austin, Texas, banking market 3 , where it is the 12th largest of 24 banking organi-
2. The Dallas banking market is approximated by Dallas County,
the southeast quadrant of Denton County (including Denton and
Lewisville), the southwest quadrant of Collin County (including
McKinney and Piano), the northern half of Rockwall County, the
communities of Forney and Terrell in Kaufman County, Midlothian,
Waxahatchie, and Ferris in Ellis County, and Grapevine and Arlington in Tarrant County.
The Fort Worth banking market is approximated by Tarrant County
excluding Grapevine and Arlington, the community of Cleburne in
Johnson County, the eastern half of Parker County (including Weatherford and Springtown), the communities of Boyd and Rhome in Wise
County, and the community of Roanoke in Denton County.
3. The Austin banking market is approximated by the Austin, Texas
RMA.
459
zations with 0.98 percent of deposits in commercial
banks in the market. Applicant's closest subsidiary is
located in a separate banking market 40 miles from
Austin. This acquisition would not result in significant
adverse effects on potential competition within this
market because the Austin market is not highly concentrated under the Board's Guidelines.
Collin competes in the Dallas, Texas, banking market, where it is the 106th largest banking organization
with 0.03 percent of deposits in commercial banks in
the market. Applicant's closest subsidiary is Allied
Lakewood Bank located approximately 16 miles from
Collin. Consummation of this proposal and the proposed acquisition of Texas United would increase
Applicant's share of the Dallas market to 2.46 percent.
Applicant has also applied for approval to establish
Allied Bank , a de novo bank, with an initial capitalization of $1.5 million. The establishment of Allied Bank
is procompetitive and should increase competition in
the Dallas banking market.
Based on the record as a whole, the Board concludes that the proposed acquisition of Texas United,
NBC, Collin and Allied Bank would not have any
significantly adverse effects on existing or potential
competition, or on the concentration of banking resources in any relevant market.
The financial and managerial resources and future
prospects of Applicant and the organizations to be
acquired are considered generally satisfactory. Based
on all the facts of record, the Board believes that
banking factors are consistent with approval of these
applications. Considerations relating to the convenience and needs of the community to be served also
are consistent with approval.
Applicant proposes to engage through Allied Leasing in the leasing of real and personal property on a full
payout basis, and will have its principal place of
business and operations in Texas. Other geographic
areas to be served include Arkansas, California, Louisiana, Oklahoma and New Mexico. There is no evidence in the record to indicate that approval of this
proposal would result in undue concentration of resources, decreased or unfair competition, conflicts of
interests, unsound banking practices or other adverse
effects on the public interest. Accordingly, the Board
has determined that the balance of the public interest
factors it must consider under section 4(c)(8) of the
Act is favorable and consistent with approval of the
application.
Based on the foregoing and facts of record, the
Board has determined that the applications under
sections 3 and 4 of the Act should be and are hereby
approved. The acquisition of the bank holding companies and the banks shall not be made before the
thirtieth calendar day following the effective date of
460
Federal Reserve Bulletin • May 1984
this Order. The acquisition of the bank holding companies and the banks and the acquisition of the leasing
subsidiary shall be consummated not later than three
months after the effective date of this Order, unless the
period is extended for good cause by the Board or by
the Federal Reserve Bank of Dallas, pursuant to
delegated authority.
The determination as to Applicant's leasing activities are subject to the conditions set forth in Regulation Y, including section 225.4(d) and 225.23(b), and to
the Board's authority to require such modification or
termination of the activities of a holding company or
any of its subsidiaries as the Board finds necessary to
assure compliance with the provisions and purposes of
the Act and the Board's regulations and orders issued
thereunder, or to prevent evasion thereof.
By order of the Board of Governors, effective
April 23, 1984.
Voting for this action: Vice Chairman Martin and Governors Wallich, Partee, Rice, and Gramley. Absent and not
voting: Chairman Volcker and Governor Teeters.
JAMES MCAFEE,
[SEAL]
Associate Secretary of the Board
Banks of Mid-America, Inc.
Oklahoma City, Oklahoma
Order Approving Consolidation of Bank Holding
Companies and Acquisition of Companies Engaged
in Mortgage Lending, Insurance, Leasing,
Commercial Lending, Financing, and Securities
Brokerage Activities
Banks of Mid-America, Inc., Oklahoma City, Oklahoma, has applied for the Board's approval under section
3 of the Bank Holding Company Act of 1956, as
amended ("Act") (12 U.S.C. § 1842), to become the
successor through consolidation of Liberty National
Corporation, Oklahoma City, Oklahoma ("Liberty"),
and First Tulsa Bancorporation, Inc., Tulsa, Oklahoma ("First Tulsa"), both bank holding companies
within the meaning of the Act. This proposal would
result in the indirect acquisition by Applicant of Liberty National Bank and Trust Company, Oklahoma City,
Oklahoma ("Liberty Bank"), and the First National
Bank and Trust Company of Tulsa, Tulsa, Oklahoma
("Tulsa Bank"). Applicant would thereby become a
bank holding company.
In addition, Applicant has applied for the Board's
approval under section 4(c)(8) of the Act (12 U.S.C.
§ 1843(c)(8)) and section 225.23(a)(2) of the Board's
Regulation Y (12 CFR § 225.23(a)(2)) to acquire the
following nonbanking subsidiaries of Liberty, all in
Oklahoma City: Liberty Financial Corporation, which
originates and services mortgages and provides construction financing secured by real estate; Liberty
Mortgage Company, which originates and services
mortgages, services non-mortgage loans and extensions of credit, and sells credit life insurance directly
related to extensions of credit by Liberty and its
subsidiaries; Mid-America Leasing Corporation,
which leases personal property and equipment; MidAmerica Credit Life Assurance Company, which underwrites credit life and credit accident and health
insurance directly related to extensions of credit by
Liberty and its subsidiaries; and Mid-America Insurance Agency, Inc., which provides insurance agent or
broker services for Liberty and its subsidiaries. In
addition, Applicant has applied to continue the direct
lending activities previously approved by the Board
for Liberty.
Applicant also has applied to acquire the following
nonbanking subsidiaries of First Tulsa, all in Tulsa:
Firstul Leasing and Financial Company, which leases
personal property, automobiles, and equipment; Firstul Mortgage Company, which originates and services
mortgage loans and provides construction financing;
Financial Loan and Investment Company, which engages in consumer finance activities; and Irwin Securities, Inc., which provides securities brokerage services solely on the order and for the account of
customers. These activities have been determined by
the Board to be closely related to banking (12 CFR
§ 225.25(a)(1), (5), (8), (9), and (15)).
Notice of these applications, affording opportunity
for interested persons to submit comments and views,
has been given in accordance with sections 3 and 4 of
the Act (48 Federal Register 55175 (1983)). The time
for filing comments and views 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 Act (12 U.S.C. § 1842(c)) and the
considerations specified in section 4(c)(8) of the Act.
Liberty, the second largest commercial banking
organization in Oklahoma, controls one subsidiary
bank with total deposits of $1.7 billion, representing
6.8 percent of the total deposits in commercial banks
in the state.1 First Tulsa, the fourth largest commercial
banking organization in Oklahoma, controls one subsidiary bank with total deposits of $1.05 billion, representing 4.2 percent of the total deposits in commercial
banks in the state. Upon consolidation, Applicant
would control 11 percent of total deposits in commer-
1. All banking data are as of December 31, 1982.
Legal Developments
cial banks in Oklahoma and would become the largest
commercial banking organization in the state.2
The Board has carefully considered the effects of the
proposal on statewide banking structure and on competition in the relevant markets. This proposal involves the consolidation of two of the largest banking
organizations in Oklahoma. In terms of concentration
of deposits in commercial banks, however, Oklahoma
is and would remain upon consummation of this proposal one of the least concentrated states in the United
States. The four largest banking organizations in Oklahoma control 27.3 percent of the total deposits in
commercial banks in the state; this figure would increase to only 29.1 percent upon consummation of this
transaction. Accordingly, it is the Board's view that
the proposed consolidation would not have a significantly adverse effect on the concentration of banking
resources in Oklahoma.
Liberty's banking subsidiary operates in the Oklahoma City banking market,3 while First Tulsa's banking subsidiary operates in the Tulsa banking market.4
Inasmuch as the banking subsidiaries of Liberty and
First Tulsa do not compete in the same banking
markets, consummation of the proposal would not
eliminate any existing competition.
The Board has considered the effects of this proposal on probable future competition in the Oklahoma
City and Tulsa markets and also has examined the
proposal in light of the Board's proposed guidelines for
assessing the competitive effects of market-extension
mergers or acquisitions.5 In evaluating the effects of a
proposed merger or consolidation on probable future
competition, the Board considers market concentration, the number of probable future entrants into the
market, the size of the bank to be acquired, and the
attractiveness of the market for de novo or foothold
entry.
Liberty is the second largest commercial banking
organization in the Oklahoma City banking market,
and its one banking subsidiary controls 19.5 percent of
2. Oklahoma bank holding company law (Okla. Stat. Ann. tit. 6,
§ 502(D) (West 1983)) prohibits a bank holding company from acquiring any federally insured financial institution if such acquisition would
result in control of more than 11 percent of the total deposits in
Oklahoma of all federally insured financial institutions, including
savings and loan associations and credit unions. Since Applicant
would not control more than 11 percent of the total deposits in the
state's federally insured financial institutions, the proposed acquisitions are consistent with Oklahoma law.
3. The Oklahoma City banking market is defined as the Oklahoma
City Ranally Metropolitan Area.
4. The Tulsa banking market is defined as the Tulsa Ranally
Metropolitan Area.
5. 47 Federal Register 9017 (March 3,1982). Although the proposed
policy statement has not been adopted by the Board, the Board is
using the policy guidelines in its analysis of the effects of a proposal on
probable future competition.
461
total deposits in commercial banking organizations in
the market. The Oklahoma City banking market is not
highly concentrated; the three largest commercial
banking organizations control only 53.6 percent of
total deposits in commercial banks in the market.
Moreover, the record indicates a trend toward deconcentration of banking resources in the market. In
addition, the Oklahoma City banking market contains
14 savings and loan associations ("thrifts") that control 14.7 percent of total deposits in commercial banks
and thrifts in the market.
First Tulsa is the second largest commercial banking
organization in the Tulsa banking market, and its one
banking subsidiary controls 19.9 percent of total deposits in commercial banks in the market. The Tulsa
banking market is not highly concentrated; the three
largest commercial banking organizations control only
56 percent of total deposits in commercial banks in the
market. Furthermore, the record indicates a trend
toward deconcentration of banking resources in the
market. In addition, there are 11 thrifts in the Tulsa
banking market that control 21.8 percent of total
deposits in commercial banks and thrifts in the market.
In its evaluation of the competitive aspects of this
case, particularly with respect to potential competition
in the relevant markets as well as the state, the Board
has considered that there are only a few banking
organizations in the state with resources comparable
to those of Liberty and First Tulsa so as to make them
likely entrants into these markets, the largest—in
terms of deposits and business activity—in the state.
However, the Board's concern is alleviated by the fact
that these markets are not highly concentrated. Therefore, on balance, the Board concludes that consummation of this proposal would not have significant adverse effects on probable future competition in any
relevant market.
The Board views with concern any decline in capital
resulting from the combination of banking organizations such as would occur in this case. In its evaluation
of the banking factors in this case, the Board has taken
particular note that, in spite of the decline in capital
resulting from the proposal, the pro forma capital
position of Banks of Mid-America would nevertheless
remain relatively high. The Board also has noted that
Applicant would have substantial cash resources that
would be maintained as a cushion to meet possible
future needs and has relied on certain commitments
relative to maintenance of capital ratios, liquidity, and
management. Based on these and other facts of record, including the current financial condition of the
banks concerned, the Board concludes that the financial and managerial resources and future prospects of
Applicant, Liberty Bank, and Tulsa Bank are consistent with approval of these applications. Consider-
462
Federal Reserve Bulletin • May 1984
ations relating to the convenience and needs of the
communities to be served also are consistent with
approval of the applications.
Applicant has also applied, pursuant to section
4(c)(8) of the Act, to acquire the nonbanking subsidiaries of Liberty and First Tulsa, which engage in mortgage lending, leasing, insurance, and securities brokerage activities. In addition, Applicant has applied to
continue the direct lending authority previously approved for Liberty. There is no evidence in the record
to indicate that approval of this proposal would result
in undue concentration of resources, unfair competition, conflicts of interest, unsound banking practices,
or other adverse effects.6 Accordingly, the Board has
determined that the balance of the public interest
factors it must consider under section 4(c)(8) of the
Act is favorable and consistent with approval.
Based on the foregoing and other facts of record, the
Board has determined that the applications under
sections 3 and 4 of the Act should be and hereby are
approved. The acquisition of Liberty Bank and Tulsa
Bank shall not be consummated before the thirtieth
day following the effective date of this Order. The
acquisition of the banks and the nonbanking subsidiaries shall not be consummated later than three months
after the effective date of this Order, unless such
period is extended for good cause by the Board or by
the Federal Reserve Bank of Kansas City, pursuant to
delegated authority. The approval of Applicant's proposal to acquire the nonbanking activities of Liberty
and First Tulsa is subject to the conditions set forth in
Regulation Y, including sections 225.4(d) and
225.23(b) (12 CFR §§ 225.4(d) and 225.23(b)), and to
the Board's authority to require such modification or
termination of the activities of a holding company or
any of its subsidiaries as the Board finds necessary to
assure compliance with the provisions and purposes of
the Act and the Board's regulations and orders issued
thereunder, or to prevent evasion thereof.
By order of the Board of Governors, effective
April 26, 1984.
Voting for this action: Chairman Volcker and Governors
Martin, Partee, Rice, and Gramley. Voting against this action: Governor Wallich. Governor Wallich abstained from the
insurance portion of these applications. Absent and not
voting: Governor Teeters.
JAMES MCAFEE,
[SEAL]
Associate Secretary of the Board
6. Liberty's mortgage banking subsidiaries, Liberty Financial Corporation and Liberty Mortgage Company, derive business from the
market served by First Tulsa, and First Tulsa's mortgage company,
Firstul Mortgage Company, derives business from the market served
by Liberty. Inasmuch as numerous mortgage banking competitors
exist in the relevant markets, the Board concludes that consummation
of this proposal would have no significant impact on competition
among these nonbanking subsidiaries of Liberty and First Tulsa.
Dissenting Statement of Governor Wallich
I dissent from the Board's action regarding this application. In my view, one of the most important justifications for combining two relatively large banks
should be a combined organization that has a stronger
financial condition than either institution standing
alone. In the manner structured, the proposal will
reduce the existing capital of the two banking organizations. Even though the capital level of the resulting
organization exceeds the Board's minimum standards,
I believe it is inappropriate to permit this reduction in
capital, particularly in view of the fact that both banks
recently experienced a sharp downturn in earnings. I
would have viewed the transaction favorably had it
involved an exchange of common shares or had it been
financed so that no net reduction in capital support
would have resulted.
For these reasons, I would deny the application.
April 26, 1984
Eagle Financial Services, Inc.
Northfield, Illinois
E.F. Wonderlic Companies, Inc.
Northfield Illinois
Order Approving Formation of Bank Holding
Companies and Acquisition of Companies Engaged
in Consumer and Commercial Lending and Loan
Servicing Activities
Eagle Financial Services, Inc., Northfield, Illinois
("Eagle"), has applied for the Board's approval under
section 3(a)(1) of the Bank Holding Company Act
(12 U.S.C. § 1842(a)(1)) ("Act") to become a bank
holding company by acquiring 97.4 percent of the
voting shares of State Bank of Richmond, Richmond,
Illinois ("Bank"). In a related transaction, E.F. Wonderlic Companies, Inc., Northfield, Illinois ("Wonderlic"), a nonoperating corporation, has applied under
section 3(a)(1) of the Act to become a bank holding
company by acquiring 100 percent of the voting shares
of Eagle and, thereby, indirectly to acquire Bank.
Together Eagle and Wonderlic are referred to as
Applicants.
Wonderlic has also applied for the Board's approval
under section 4(c)(8) of the Act (12 U.S.C.
§ 1843(c)(8)) to acquire directly 100 percent of the
voting shares of E.F. Wonderlic and Associates, Inc.,
1. Associates, which was incorporated in May 1961, is the successor to a business which began operations in 1938 and which had been
engaged in the publication and sale of personnel tests and related
materials. Upon consummation of this proposal, Associates will cease
engaging in these impermissible nonbanking activities.
Legal Developments
Northfield, Illinois ("Associates"), a corporation1
which owns Eagle Finance Corporation ("Finance"),
and Eagle Acceptance Corporation ("Acceptance").2
Both Finance and Acceptance engage in the activity of
making, acquiring and servicing consumer and commercial loans and other extensions of credit. These
activities have been determined by the Board to be
closely related to banking (12 CFR § 225.25(b)(1)).
Notice of the applications, affording an opportunity
for interested persons to submit comments and views,
has been given in accordance with sections 3 and 4 of
the Act (49 Federal Register 4848, 9470) (1984). The
time for filing comments and views has expired, and
the Board has considered the applications and all
comments received in light of the factors set forth in
section 3(c) and the considerations specified in section
4(c)(8) of the Act.
Applicants, which are nonoperating Illinois corporations, were organized for the purpose of becoming
bank holding companies by acquiring, directly and
indirectly, 97.4 percent of the voting shares of Bank.
Upon acquisition of their direct and indirect interests
in Bank, Applicants would control a banking organization with approximately $15.3 million in deposits,3
which is one of the smaller banking organizations in
Illinois. Consummation of this proposal would have no
significant effects on the concentration of banking
resources in Illinois.
The proposed transaction is essentially a corporate
reorganization and would not increase the concentration of banking resources in any relevant area. Neither
Applicants nor any of their principals is affiliated with
any other banking organization in any relevant banking market and, therefore, consummation of the proposal would not result in any adverse effects upon
competition in any relevant area.
The financial and managerial resources of Applicants and Bank are generally satisfactory, and the
future prospects of each appear favorable. Although
Applicants do not anticipate any immediate changes in
the services offered by Bank, considerations relating
to the convenience and needs of the communities to be
served also are consistent with approval of the applications. Further, there is no evidence in the record to
indicate that approval of this proposal would result in
undue concentration of resources, decreased or unfair
competition, conflicts of interests, unsound banking
practices or other adverse effects on the public interest. Accordingly, the Board has determined that the
2. Finance and Acceptance have 10 offices in Florida and Illinois.
Associates also controls E.F. Wonderlic Management Corporation, a
subsidiary engaged exclusively in the preparation of payroll services
for Associates' subsidiaries. Pursuant to 12 CFR § 225.22(a)(2)(iv),
Wonderlic may acquire this servicing subsidiary without obtaining the
Board's prior approval.
3. Deposit data are as of December 31, 1983.
463
balance of the public interest factors it must consider
under section 4 of the Act is consistent with approval
of the application.
Based on the foregoing and other facts of record, the
Board has determined that the applications should be,
and hereby are, approved.
The acquisition of Bank's shares by Eagle, and of
Eagle's shares by Wonderlic, shall not be made before
the thirtieth calendar day following the effective date
of this Order. All the transactions shall not be consummated later than three months after the effective date
of this Order, unless such period is extended for good
cause by the Board or by the Federal Reserve Bank of
Chicago, acting pursuant to delegated authority. The
determination as to Wonderlic's acquisition of Associates and its nonbank subsidiaries is subject to the
conditions set forth in the Board's Regulation Y and
the Board's authority to require such modification or
termination of the activities of a holding company or
any of its subsidiaries as the Board finds necessary to
assure compliance with the provisions and purposes of
the Act and the Board's regulations and orders issued
thereunder, or to prevent evasion thereof.
By order of the Board of Governors, effective
April 5, 1984.
Voting for this action: Governors Wallich, Partee, Rice,
and Gramley. Absent and not voting: Chairman Volcker and
Governors Martin and Teeters.
JAMES MCAFEE,
[SEAL]
Associate Secretary of the Board
Landmark Banking Corporation of Florida
Fort Lauderdale, Florida
Preferred Equity Investors of Florida, Inc.
Knoxville, Tennessee
Order Approving Acquisition and Merger of Bank
Holding Companies and Acquisitions of Companies
Engaged in Insurance, Mortgage Banking, Real
Estate Appraisals, Data Processing and Electronic
Funds Transfer Activities
Landmark Banking Corporation of Florida, Fort Lauderdale, Florida ("Landmark"), a bank holding company within the meaning of the Bank Holding Company Act of 1956, as amended ("Act"), has applied for
the Board's approval under section 3(a)(5) of the Act
(12 U.S.C. § 1842(a)(5)) to merge with Southwest
Florida Banks, Inc., Fort Myers, Florida ("Southwest"). Preferred Equity of Investors of Florida, Inc.,
("Preferred Equity") Knoxville, Tennessee, a bank
holding company within the meaning of the Act by
virtue of its ownership of 27.1 percent of Landmark's
464
Federal Reserve Bulletin • May 1984
voting securities, also has applied pursuant to section
3(a)(3) of the Act, to acquire indirect control of Southwest (together, Preferred Equity and Landmark are
referred to as "Applicant").1
Applicant also has applied for the Board's approval
under section 4(c)(8) of the Act (12 U.S.C.
§ 1843(c)(8)) and section 225.23(a)(2) of the Board's
Regulation Y (12 CFR § 225.23(a)(2)), to acquire
Southwest Mortgage Services, Inc., Fort Myers, Florida, a company engaged in mortgage banking activities; Southwest Financial Services, Inc., Fort Myers,
Florida, a company engaged in the sale of credit life
insurance and real estate appraisal services; and
Southwest Data Services, Inc., Fort Myers, Florida, a
company that engages in data processing activities.
Applicant also has applied to acquire Southwest's
interest in the Florida Interchange Group, a company
that provides electronic funds transfer services. These
activities have been determined by the Board to be
closely related to banking and permissible for bank
holding companies (12 CFR § 225.23(b)(1), (7), (8), and
(13).
Notice of the applications, affording opportunity for
interested persons to submit comments, has been
given in accordance with sections 3 and 4 of the Act.
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 Act (12 U.S.C. § 1842(c)) and the
considerations specified in section 4(c)(8) of the Act.2
Applicant is the tenth largest banking organization
in Florida with five subsidiary banks that control
aggregate deposits of $1.2 billion,3 representing 2.5
percent of the total deposits in commercial banks in
the state. Southwest is the ninth largest banking organization in the state, with 18 banking subsidiaries that
control aggregate deposits of $1.4 billion, representing
2.8 percent of the total deposits in commercial banks
1. Preferred Equity has also applied for the Board's prior approval
to acquire warrants to purchase 1,425,345 of Southwest's common
shares. Upon exercise of the warrants, these shares would represent
approximately 15.6 percent of Southwest's outstanding common
shares.
2. The Board received comments from four individuals regarding
the proposed acquisitions. Two of the comments stated that the terms
of Applicant's offer were unfair to minority shareholders and two
comments stated that a performance incentive plan approved by
Southwest for its management was not in the best interests of its
shareholders. In general, the Act does not require the Board to
consider the fairness of a stock purchase offers to minority shareholders when it considers a bank holding company application. Western
Bancshares, Inc. v. Board of Governors, 480 F.2d 749 (10th Cir.
1973). In addition, the Board has examined the performance incentive
plan for Southwest's management and believes that the plan has no
bearing on the proposal by Applicant to acquire Southwest. Accordingly, the Board has determined that the comments do not present
substantive issues that, if true, would require denial of the application.
3. Deposit data are as of June 30, 1982.
in the state. Upon consummation of the proposed
acquisition, Applicant's share of the total deposits in
commercial banks in the state would increase to 5.3
percent, and Applicant would become the fifth largest
commercial banking organization in the state. While
this combination of the ninth and tenth largest commercial banking organizations in Florida would have
some effect on the concentration of banking resources
within the state, the share of commercial bank deposits held by the four largest banking organizations in
Florida would remain at 43.7 percent after consummation of the proposed merger. Thus, Florida would
remain moderately concentrated in terms of banking
resources upon consummation of the proposal. Accordingly, it is the Board's view that consummation of
this acquisition would not have any significantly adverse effects on the concentration of commercial banking resources in Florida.
Applicant's subsidiary banks compete directly with
Southwest's subsidiary banks in the Tampa and Pinellas County banking markets. In the Tampa banking
market, Applicant is the fifth largest commercial banking organization, with deposits of $107 million, representing approximately 4 percent of the total deposits in
commercial banks in the market.4 Southwest is the
sixth largest commercial banking organization in the
market, with deposits of $102 million, also representing approximately 4 percent of the total deposits in
commercial banks in the market. Upon consummation
of the proposal, Applicant would remain the fifth
largest commercial banking organization in the market
and control approximately 8 percent of the total deposits in commercial banks in the market.
While consummation of this proposal would eliminate some existing competition between Applicant and
Southwest in the Tampa banking market, this market
is not highly concentrated, with the four largest commercial banking organizations in the market controlling 69.4 percent of the deposits in commercial banks
in the market. The Herfindahl-Hirschman Index
("HHI") in the market is 1365 and would increase to
1393 upon consummation of the proposal. In addition,
numerous other commercial banking organizations
would remain as alternatives for banking services in
the Tampa banking market after consummation of the
proposal. In light of these facts, the Board concludes
that the acquisition would not have any significant
adverse effect on competition in the Tampa market.
Applicant is the second largest commercial banking
organization in the Pinellas County banking market,
with deposits of approximately $324 million, representing approximately 9 percent of the total deposits in
4. The Tampa banking market is defined as Hillsborough County
plus the town of Land O'Lakes in Pasco County, Florida.
Legal Developments
commercial banks in the market.5 Southwest is the
19th largest commercial banking organization in the
market, with deposits of $64 million, representing 2
percent of the total deposits in commercial banks in
the market. Upon consummation of the proposal,
Applicant would remain the second largest commercial banking organization in the market. While consummation of the proposal would eliminate some
existing competition between Applicant and Southwest in the Pinellas banking market, this market is
unconcentrated and would remain unconcentrated after consummation of the proposal, with the four largest commercial banks controlling only 44.1 percent of
the market's deposits. The HHI in the market is 721
and would increase to 750 upon consummation of the
proposal. In addition, numerous other commercial
banks would remain as alternatives for banking services after consummation of the proposal. Accordingly, the Board concludes that the acquisition would not
have any significant adverse effects on competition in
the Pinellas County banking market.
The Board has considered the effects of this proposal on probable future competition in the 11 markets in
which Applicant and Southwest do not compete directly. The Board also has examined the proposal in
light of its proposed guidelines for assessing the competitive effects of market extension mergers and acquisitions.6 Applicant operates in three banking markets
in which Southwest does not operate: South Brevard
County, Miami-Fort Lauderdale and Orlando. Because of its size and financial resources and past
history of expansion, Southwest appears to be a
probable future entrant into these markets. None of
these markets are concentrated, however, as measured by the Board's guidelines, and in the Orlando
and Miami-Fort Lauderdale markets, Applicant's subsidiaries are not among the market's three largest
commercial banking organizations and do not control
10 percent of the market's deposits. Accordingly,
consummation of the proposal would not result in a
significant elimination of probable future competition
in these markets.
Southwest operates in eight markets where Applicant does not operate.7 Because of its size and financial resources, Applicant is viewed as a probable
5. The Pinellas County banking market is defined as Pinellas
County, Florida.
6. "Policy Statement of the Board of Governors of the Federal
Reserve System for Assessing Competitive Factors Under the Bank
Merger Act and the Bank Holding Company Act," 47 Federal
Register 9017 (March 3, 1982). While the proposed policy statement
has not been approved by the Board, the Board is using the policy
guidelines as part of its analysis of the effect of a proposal on probable
future competition.
7. These markets are: Immokalee, Port Charlotte, Naples, Fort
Myers, Sarasota, Venice, New Port Richey, and Bradenton.
465
future entrant into these markets. Four of these markets are not concentrated as measured by the Board
guidelines, however. In addition, there are more than
six commercial banking organizations that appear to
be probable future entrants into the Immokalee banking market. The Naples banking market is unattractive
for entry based on the average deposit growth rate for
the past two years, and in the Venice and Port
Charlotte markets, Southwest's subsidiaries are not
among the three largest commercial banking organizations in the market. Accordingly, the Board concludes
that consummation of the proposal would not result in
any significant adverse effect on probable future competition in any relevant market.
The financial and managerial resources of Applicant, Southwest and their subsidiaries are regarded as
generally satisfactory, and their future prospects appear favorable. Considerations relating to the convenience and needs of the communities to be served also
are consistent with approval of the application.
Applicant also has applied, pursuant to section
4(c)(8) of the Act, to acquire Southwest Mortgage
Services, Inc., Fort Myers, Florida, a company engaged in mortgage banking activities; Southwest Financial Services, Inc., Fort Myers, Florida, a company engaged in the sale of credit life insurance and real
estate appraisal services; and Southwest Data Services, Inc., Fort Myers, Florida, a company that
engages in data processing activities. Applicant also
has applied to acquire Southwest's interest in the
Florida Interchange Group, a joint venture that provides electronic funds transfer services for ten Florida
banking organizations. Although Applicant engages,
through several subsidiaries in the sale of credit related insurance, no adverse competitive effect would
result from this acquisition because the activities of
Southwest Financial Services, Inc., would be limited
to the sale of insurance directly related to extensions
of credit made by the subsidiaries of Southwest acquired through this transaction. Although Applicant
also engages in mortgage banking and data processing
services in the relevant markets served by Southwest,
Applicant's market share in these services is not
significant and there are numerous other competitors
that provide these services. Accordingly, it does not
appear that Applicant's acquisition of these subsidiaries would have any significant adverse effect upon
existing or potential competition.
Furthermore, there is no evidence in the record to
indicate that approval of this proposal would result in
undue concentration of resources, decreased or unfair
competition, conflicts of interests, unsound banking
practices or other adverse effects on the public interest. Accordingly, the Board has determined that the
balance of the public interest factors it must consider
466
Federal Reserve Bulletin • May 1984
under section 4(c)(8) of the Act is favorable and
consistent with approval of the applications to acquire
these nonbanking subsidiaries.
Based on the foregoing and the facts of record, the
Board has determined that the applications under
sections 3 and 4 of the Act should be and hereby are
approved. The acquisition of Southwest 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 Atlanta pursuant to
delegated authority. The determinations as to Applicant's nonbanking activities are subject to the conditions set forth in section 225.23(b)(3) of Regulation Y
(12 CFR § 225.23(b)(3)) and to the Board's authority to
require such modification or termination of the activities of a holding company or any of its subsidiaries as
the Board finds necessary to assure compliance with
the provisions and purposes of the Act and the Board's
regulations and orders issued thereunder, or to prevent evasion thereof.
By order of the Board of Governors, effective
April 9, 1984.
Voting for this action: Chairman Volcker and Governors
Martin, Partee, Rice, and Gramley. Governor Gramley abstained from voting on the data processing portion of these
applications. Absent and not voting: Governors Wallich and
Teeters.
JAMES MCAFEE,
[SEAL]
Associate Secretary of the Board
Meridian Bancorp, Inc.
Reading, Pennsylvania
Order Conditionally Approving Acquisition of Bank
Holding Company and Company Engaged in
Insurance Activities
Meridian Bancorp, Inc., Reading, Pennsylvania ("Applicant"), a bank holding company within the meaning
of the Bank Holding Company Act of 1956, as amended (12 U.S.C. § 1841 et seq.), has applied for the
Board's approval under section 3(a)(3) of the Act
(12 U.S.C. § 1842(a)(3)) to acquire all of the voting
shares of First National Bancorp of Allentown, Inc.,
Allentown, Pennsylvania ("FNBA"), and thereby indirectly to acquire FNBA's subsidiary bank, First
National Bank of Allentown, Allentown, Pennsylvania
("Bank").
Applicant has also applied for the Board's approval
under section 4(c)(8) of the Act (12 U.S.C.
§ 1843(c)(8)) to acquire Firal Life Insurance Company,
Allentown, Pennsylvania ("Firal"), a company en
gaged in the activity of underwriting, as reinsurer,
credit life, accident and health insurance directly related to extensions of credit made by Bank. This activity
has been determined by the Board to be closely related
to banking and permissible for bank holding companies (12 CFR § 225.25(b)(9)), and this determination
has not been affected by the recent amendments to
section 4(c)(8) of the Act limiting the permissible
insurance activities of bank holding companies.1
Notice of the applications, affording opportunity for
interested persons to submit comments, has been
given in accordance with sections 3 and 4 of the Act
(49 Federal Register 4986, 7869 (1984)). 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 Act
(12 U.S.C. § 1842(c)) and the considerations specified
in section 4(c)(8) of the Act.
Applicant is the fifth largest banking organization in
Pennsylvania with two subsidiary banks that control
aggregate deposits of approximately $3.1 billion, representing 4 percent of the total deposits in commercial
banks in the state.2 FNBA is the fourteenth largest
commercial banking organization in the state, with one
banking subsidiary that controls deposits of $988.7
million, representing 1.3 percent of the total deposits
in commercial banks in the state. Upon consummation
of the proposed acquisition, Applicant's share of the
total deposits in commercial banks in Pennsylvania
would increase to 5.3 percent, and Applicant would
become the fourth largest commercial banking organization in the state. The Board has carefully considered
the effects of the proposal on the structure of banking
in Pennsylvania and has concluded that consummation
of this transaction would not have a significant adverse
effect on the concentration of banking resources in the
state.
Applicant's subsidiary banks compete directly with
FNBA's subsidiary bank in three banking markets: the
Allentown-Bethlehem; Philadelphia; and Reading
banking markets. Applicant is the tenth largest of 42
commercial banking organizations in the AllentownBethlehem banking market,3 with $72.6 million in
deposits, representing 1.9 percent of the total deposits
in commercial banks in the market.4 FNBA is the
largest banking organization in the Allentown-Bethlehem banking market, with deposits of $829.6 million,
1. See, Garn-St Germain Depository Institutions Act of 1982, Pub.
L. No. 97-320, § 601, 96 Stat. 1469, 1536-38 (1982).
2. State banking data are as of December 31, 1983.
3. The Allentown-Bethlehem banking market is approximated by
Lehigh, Carbon, and Northampton Counties, Pennsylvania, and by
Warren County, New Jersey.
4. All market data are as of June 30, 1982, and reflect acquisitions
as of December 31, 1983.
Legal Developments
representing approximately 21.4 percent of the total
deposits in commercial banks in the market. Upon
consummation of this proposal, Applicant would become the largest commercial banking organization in
the market, controlling approximately 23.3 percent of
the total deposits in commercial banks in the market.
While consummation of the proposal would eliminate some exisiting competition in the AllentownBethlehem banking market, the Board believes that
these competitive effects are not significant. Upon
consummation of the transaction, the HerfindahlHirschman Index ("HHI") would increase by only 81
points to 1173,5 the share of deposits held by the four
largest banking organizations in the market would
increase by 1.9 percent to 55.3 percent, and the market
would remain moderately concentrated as measured
by both these indexes. Moreover, 41 commercial
banking alternatives would remain in the market after
consummation of the transaction.
Finally, in its evaluation in previous cases of the
competitive effects of a proposal, the Board has indicated that thrift institutions have become, or at least
have the potential to become, major competitors of
commercial banks.6 On this basis, the Board has
accorded substantial weight to the influence of thrift
institutions in its evaluation of the competitive effects
of a proposal. In this case, the increase in concentration in the Allentown-Bethlehem banking market is
further alleviated by the presence of 24 thrift institutions in the market, controlling $1.4 billion in deposits,
which represents approximately 26 percent of the total
deposits in commercial banks and thrift institutions in
the market. The thrift institutions in the market currently offer a full range of consumer services and
transaction accounts. Further, under provisions of the
Garn-St Germain Depository Institutions Act of 1982,
the commercial lending powers of federal thrift institutions have been significantly expanded, and Pennsylvania law extends comparable commercial lending
powers to state-chartered thrift institutions.7 Consequently, the Board has determined that consummation
of this proposal would not have a significantly adverse
effect on existing competition in the Allentown-Bethlehem banking market.8
5. Under the United States Justice Department Merger Guidelines
(June 14, 1982), a market in which the post-merger HHI is between
1000 and 1800 is considered moderately concentrated. In such markets, the Department is not likely to challenge a merger such as this
proposal that produces an increase in the HHI of less than 100 points.
6. Comerica Inc. (Bank of the Commonwealth), 69 FEDERAL
RESERVE BULLETIN 797 (1983); General Bancshares Corporation, 69
FEDERAL RESERVE BULLETIN 802 (1983); First Tennessee
69 FEDERAL RESERVE BULLETIN 298 (1983).
National
Corporation,
7. 7 PA. Stat. Ann. §§ 506(a)(iv), 6020-101(a)(22) (Supp. 19821983).
8. If the deposits of the thrift institutions were taken into account in
computing market shares, Applicant's market share would be 1.4
467
Applicant is the eighth largest commerical banking
organization in the Philadelphia banking market9 and
controls 4.8 percent of the total deposits in commercial
banks in the market. FNBA is the 52nd largest banking
organization in the relevant banking market, controlling 0.03 percent of the total deposits in commercial
banks in the market. The Philadelphia banking market
is unconcentrated and would remain so after consummation of the proposal, with a post-merger HHI of
835.5 points. Accordingly, the Board concludes that
the acquisition would not have any significant effects
on competition in the Philadelphia banking market.
Applicant is the largest of 13 commercial banking
organizations in the Reading banking market,10 with
$828.3 million in deposits, representing 40.5 percent of
the total deposits in commercial banks in the market.
FNBA is the seventh largest commercial banking
organization in the Reading market, controlling one
branch in the market with $38.6 million in deposits,
representing 1.9 percent of the total deposits in commercial banks in the Reading market. FNBA's branch
in the Reading market is located in Kutztown, Pennsylvania, where Applicant also has a branch with
deposits of $9 million. Upon consummation of this
proposal, Applicant would control two of the three
banking offices located in Kutztown.
The Board is concerned about the effect of this
proposal on the concentration of banking resources in
the Reading banking market, particularly because the
transaction would result in a single banking organization controlling 42.4 percent of the total deposits in
commercial banks in the market. In addition, the
Reading banking market is now highly concentrated,
with a four-firm concentration ratio of 89.9 percent,
which would increase to 91.8 percent, and with an
HHI of 2614, which would increase 154 points to 2768
upon consummation of this proposal.11 In view of the
above, the Board concludes that consummation of the
proposal would eliminate a substantial amount of
existing competition in the Reading banking market.
percent, FNBA's market share would be 15.8 percent, and the HHI
would be 670. Upon consummation of the proposal, Applicant's
market share would increase to 17.2 percent, and the HHI would
increase only 44 points to 714.
9. The Philadelphia banking market is approximated by Philadelphia, Montgomery, Bucks, Chester and Delaware Counties, all in
Pennsylvania, and by Camden, Burlington, and Gloucester Counties,
all in New Jersey.
10. The Reading banking market is approximated by Berks County,
Pennsylvania.
11. Under the Justice Department's Merger Guidelines, a market in
which the post-merger HHI is above 1800 is considered highly
concentrated. In such markets, the Department is likely to challenge a
merger that produces an increase in the HHI of 100 points or more, as
in this case. The Justice Department has also indicated that it is likely
to challenge the merger of any firm with at least one percent of the
market with a leading firm that controls at least 35 percent of the
market and whose market share is approximately twice as large as that
of the second largest firm in the market, as in this case.
468
Federal Reserve Bulletin • May 1984
The Board believes in this instance that the anticompetitive effects of the transaction are not significantly
mitigated by the presence of thrift institutions in the
Reading banking market. Seven thrift institutions operate in the market, and they control 22.5 percent of
the total deposits in the market. The record indicates
that only two of the thrift institutions currently are
engaged actively in commercial lending. Moreover,
even if 100 percent of the deposits of the thrift institutions were included in the commercial banking product
market, the Board believes that the market share
involved and the resulting concentration in the market
would be so substantial as to warrant denial of the
application. Applicant would remain the largest institution in the market with a market share of 31.3
percent; FNBA's would be 1.5 percent; and, upon
consummation of the proposal, Applicant would control 32.8 percent of the total deposits in commercial
banks and thrift institutions in the market. Furthermore, the share of deposits held by the four largest
financial institutions in the market would increase
from 74.0 percent to 75.5 percent, and the HHI would
increase 94 points to 1789. Although the market would
be only moderately concentrated using the HHI Index
and would remain so upon consummation of the
proposal, the transaction barely falls below the level
which would be subject to challenge under the Department of Justice Merger Guidelines.
As indicated above, only one of FNBA's 29
branches is located in the Reading banking market.
This branch holds $38.6 million in deposits, representing only a small part of the total transaction (approximately 1 percent of the deposits of Applicant and
FNBA combined). If FNBA were to divest this branch
prior to consummation of this proposal, no existing
competition would be eliminated in the Reading banking market and, based upon the Board's finding of no
significant adverse competitive impact on any other
relevant market, the Board would approve the application. Accordingly, the Board has determined to approve the application on the condition that FNBA
divest its branch in the Reading market prior to
consummation of the proposal.
The Board has considered the effects of this proposal on probable future competition in the three markets
in which Applicant and FNBA do not compete directly
and in the Reading banking market, since the Board's
approval of this proposal would be conditioned upon
the divestiture of FNBA's only branch in the Reading
banking market prior to consummation of the proposal. The Board has also examined this proposal in the
context of its proposed guidelines for assessing the
competitive effects of market extension mergers and
acquisitions. Because there are numerous potential
entrants into each of these markets, the Board concludes that consummation of this proposal would not
have any significant adverse effects on probable future
competition in any relevant area.
The financial and managerial resources of Applicant, FNBA and their subsidiaries are regarded as
generally satisfactory, and their prospects appear favorable. Thus, banking factors are consistent with
approval of the application. The record of this application indicates that Applicant would expand FNBA's
automatic teller system and expand or improve
FNBA's consumer, student and mortgage lending activity, as well as other bank services, such as cash
management, personal trust and electronic funds
transfer. In addition, it appears that Applicant may
provide Bank's customers with new discount brokerage, mortgage banking, and personal asset management services. In the Board's view, these considerations do not outweigh the substantially adverse
competitive effects that would occur as a result of this
proposal, absent a divestiture of FNBA's branch in the
Reading banking market prior to consummation of the
transaction.
Applicant has also applied, pursuant to section
4(c)(8) of the Act, to acquire Firal, a wholly owned
subsidiary of FNBA, which underwrites, as reinsurer,
credit life, accident and health insurance directly related to extensions of credit made by Bank. Although
Applicant also has a nonbanking subsidiary engaged in
the reinsurance of credit life, accident and health
insurance, it appears from the facts of record that no
adverse competitive effects would result from this
acquisition. Accordingly, it does not appear that Applicant's acquisition of Firal would have any significant adverse effect upon existing or potential competition.
Furthermore, there is no evidence in the record to
indicate that approval of this proposal would result in
undue concentration of resources, decreased or unfair
competition, conflicts of interests, unsound banking
practices or other adverse effects on the public interest. Accordingly, the Board has determined that the
balance of the public interest factors it must consider
under section 4(c)(8) of the Act is favorable and
consistent with approval of the application to acquire
Firal.
Based on the foregoing and other facts of record, the
Board has determined that the applications under
sections 3(a)(3) and 4(c)(8) of the Act should be, and
hereby are, approved, subject to the condition that
FNBA divest its branch in the Reading banking market
on or before the date of its acquisition by Applicant.12
12. The Board's policy with regard to competitive divestitures
requires that divestitures intended to cure the anticompetitive effects
resulting from a merger or acquisition occur on or before the date of
consummation of the merger to avoid the existence of anticompetitive
efiFects. See Barnett Banks of Florida, Inc., 68 FEDERAL RESERVE
B U L L E T I N 1 9 0 ( 1 9 8 2 ) ; InterFirst
BULLETIN 2 4 3 ( 1 9 8 2 ) .
Corporation,
6 8 F E D E R A L RESERVE
Legal Developments
Applicant's acquisition of FNBA's bank subsidiary
shall not be made before the thirtieth calendar day
following the effective date of this Order, and neither
the acquisition of the banking nor nonbanking subsidiary shall occur later than three months after the
effective date of this Order, unless such period is
extended for good cause by the Board or by the
Federal Reserve Bank of Philadelphia, acting pursuant
to delegated authority. The determinations as to Applicant's nonbanking activities are subject to the conditions set forth in the Board's Regulation Y and the
Board's authority to require such modification or
termination of the activities of a holding company or
any of its subsidiaries as the Board finds necessary to
assure compliance with the provisions and purposes of
the Act and the Board's regulations and orders issued
thereunder, or to prevent evasion thereof.
By order of the Board of Governors, effective
April 16, 1984.
Voting for this action: Governors Martin, Wallich, Partee,
Rice, and Gramley. Governor Wallich abstained from the
insurance portion of these applications. Present and not
voting: Chairman Volcker. Absent and not voting: Governor
Teeters.
JAMES MCAFEE,
[SEAL]
Associate Secretary of the Board
Nevada First Development Corporation
Reno, Nevada
Order Approving Formation of a Bank Holding
Company and Retention of Nonbanking Subsidiaries
Nevada First Development Corporation, Reno, Nevada, has applied for the Board's approval under section
3(a)(1) of the Bank Holding Company Act ("Act")
(12 U.S.C. § 1842(a)(1)) to become a bank holding
company through the acquisition of Nevada First
Bank, Reno, Nevada ("Bank"), a proposed new bank.
Applicant has also applied for the Board's approval
under section 4(c)(8) of the Act (12 U.S.C.
§ 1843(c)(8)) and section 225.4(b) of the Board's Regulation Y (12 CFR § 225.4(b)) to retain the following
nonbanking subsidiaries: (1) Silver State Thrift and
Loan Association, Reno, Nevada ("SST"), which
makes loans for its own account, operates as a thrift
company (an entity similar to an industrial loan company) in the manner authorized by Nevada law, performs the escrow agent activities that may be performed by a trust company, and acts as insurance
agent for the sale and issuance of credit life and credit
health and accident insurance directly related to exten
469
sions of credit;1 (2) Nevada First Thrift, Reno, Nevada
("NFT"), which engages in the same activities performed by SST and, in addition, leases personal property where the lease is equivalent to an extension of
credit and performs appraisals of real estate in support
of credit requests;2 and (3) Lori Insurance Company,
Ltd., Grand Turk, Turks & Caicos Islands ("LIC"),
which reinsures credit life and credit health and accident insurance.3 These activities have been determined by the Board to be closely related to banking
and permissible for bank holding companies (12 CFR
§ 225.25(b)(1), (2), (3), (5), (8), (9), and (13)). Neither
SST nor NFT offers transaction accounts.
Notice of the applications, affording opportunity for
interested persons to submit comments and views, has
been given in accordance with sections 3 and 4 of the
Act (49 Federal Register 935 (1984)). 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 Act
and the considerations specified in section 4(c)(8) of
the Act.
Applicant, a development corporation under Nevada law, has applied to acquire Bank, a de novo
institution. Applicant is the parent company of NFT,
SST, and LIC, and currently has no banking subsidiaries.
Bank would be located in the metropolitan Reno
banking market.4 Since Bank would be a de novo
commercial bank, consummation of the proposal can
be expected to result in increased competition in this
market. Since neither Applicant nor any of its principals has an ownership interest in any other banking
organization in the market, consummation of the proposal would not result in any adverse effects on
competition or increase the concentration of banking
resources. Accordingly, the Board concludes that
competitive considerations lend weight toward approval of the application to acquire Bank.
1. SST also currently sells property insurance to its loan customers
to protect collateral in the form of personal property. This activity is
prohibited to bank holding companies under Title VI of the Garn-St
Germain Depository Institutions Act of 1982, and Applicant has
committed to discontinue sale of this type of insurance within two
years of approval of its application in accordance with section 4(a)(2)
of the Act.
2. NFT also sells property insurance to its loan customers to
protect collateral in the form of personal property and acts as agent for
the sale of term life insurance that is unrelated to extensions of credit
by NFT. Applicant has committed to discontinue NFT's impermissible insurance activities within two years of approval of this application.
3. Applicant has committed that LIC will only reinsure credit
insurance policies related to extensions of credit by NFT, SST, and
Bank. Applicant has also committed immediately to begin efforts to
divest LIC and to divest LIC, at the latest, within two years of
approval of this application.
4. The metropolitan Reno banking market is approximated by the
Reno Ranally Metropolitan Area.
470
Federal Reserve Bulletin • May 1984
The financial and managerial resources of Applicant
and its subsidiaries are regarded as generally satisfactory, and their prospects appear favorable. Thus,
banking factors are consistent with approval of the
applications. Considerations relating to the convenience and needs of the community to be served also
are consistent with approval.
Under Nevada law, NFT and SST are prohibited
from accepting demand deposits or offering transaction accounts. Accordingly, these institutions are not
"banks" within the meaning of the Act. In recent
cases involving the acquisition of industrial loan companies similar to the thrift companies in this proposal,
however, the Board has imposed as a condition of
approval the requirement that the applicant not use
sweep accounts or tandem operations between the
industrial loan company and any other subsidiary or
other financial institution as a means of offering as a
package the demand deposit and commercial lending
services that define a bank under the Act. The Board
has imposed this condition in order to ensure that
industrial loan companies and similar institutions are
not used as a device to evade the Act, and the Board
believes that it is appropriate to impose this condition
in approving this application. Accordingly, the
Board's approval of this proposal is subject to the
condition that Bank not engage in any tandem operations or sweep arrangements with NFT or SST that
would result in the offering of the demand deposit and
commercial lending services that define a bank under
the Act.
Under Nevada law, Applicant, as a development
corporation, and NFT and SST, as thrift companies,
are authorized to engage in real estate development
and investment activities broader than those permitted
for a bank holding company and its subsidiaries under
the Act. Neither Applicant nor its subsidiaries currently engage in real estate development activities. Applicant has committed that it will not engage in real estate
development activities and that neither NFT nor SST
will engage in any real estate activities impermissible
for the subsidiaries of a bank holding company under
the Act.
There is no evidence in the record to indicate that
Applicant's proposal to retain NFT, SST, and LIC
would result in any undue concentration of resources,
decreased or unfair competition, conflicts of interests,
unsound banking practices, or other adverse effects on
the public interest. Accordingly, the Board has determined that the balance of the public interest factors
that it must consider under section 4(c)(8) is favorable
and consistent with approval of the applications.
Based on the foregoing, including the commitments
made by Applicant, the Board has determined that
consummation of the proposal would be in the public
interest and that the applications should be approved.
On the basis of the record, the applications are approved. This determination is subject to the conditions
set forth in this Order and in section 225.4(c) of
Regulation Y, and the Board's authority to require
such modification or termination of the activities of a
holding company or any of its subsidiaries as the
Board finds necessary to assure compliance with the
provisions and purposes of the Act and the Board's
regulations and orders issued thereunder, or to prevent evasion thereof.
The acquisition of Bank shall not be consummated
before the thirtieth calendar day following the effective
date of this Order 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 San Francisco, pursuant to
delegated authority.
By order of the Board of Governors, effective
April 18, 1984.
Voting for this action: Vice Chairman Martin and Governors Wallich, Partee, Rice, and Gramley. Governor Wallich
abstained from the insurance portion of these applications.
Absent and not voting: Chairman Volcker and Governor
Teeters.
JAMES MCAFEE,
[SEAL]
Associate Secretary of the Board
Orders Issued Under Bank
Corporation Act
Services
Norwest Corporation
Minneapolis, Minnesota
Order Approving Applications to Acquire a Bank
Holding Company and to Engage in General
Insurance Agency Activities and the Underwriting of
Credit Life and Credit Accident and Health
Insurance
Norwest Corporation, Minneapolis, Minnesota, a
bank holding company within the meaning of the Bank
Holding Company Act of 1956, as amended (12 U.S.C.
§ 1841 et seq.) ("BHC Act"), has applied under
section 3(a)(5) of the Act (12 U.S.C. § 1842(a)(5)) to
acquire Bankshares of Nebraska, Inc., Grand Island,
Nebraska ("BON"), also a bank holding company and
thereby to acquire indirectly BON's subsidiary bank,
The First National Bank of Grand Island ("Bank"). In
addition, Norwest has applied under section 4(c)(8) of
the Act (12 U.S.C. § 1843(c)(8)) and section
225.23(a)(2) of the Board's Regulation Y (12 CFR
Legal Developments
225.23(a)(2)), (49 Federal Register 974 (1984)) for the
Board's approval to acquire BON's nonbanking subsidiaries: Bankshares of Nebraska Life Insurance
Company, Phoenix, Arizona ("Bankshares Life")
which engages in underwriting and reinsuring credit
life and credit accident and health insurance directly
related to extensions of credit by BON's subsidiaries;
and the insurance agency and leasing activities conducted by BON directly.
Notice of the applications, affording interested persons an opportunity to submit comments, has been
given in accordance with sections 3 and 4 of the Act.
(49 Federal Register 4149 (1984)). The time for filing
comments has expired and the Board has considered
these applications and all comments received in light
of the factors specified in section 3(c) and the considerations set forth in section 4(c)(8) of the Act.
Norwest, with total consolidated assets of $19.9
billion,1 controls 86 banks in seven states, including
Iowa, Minnesota, Montana, Nebraska, North Dakota,
South Dakota and Wisconsin. Norwest, the largest
banking organization in Nebraska, controls five subsidary banks in Nebraska with deposits of $907 million,
representing 7.83 percent of total deposits in commercial banks in the state.2 BON, with deposits of $122.6
million, controls approximately 1.1 percent of the total
deposits in commercial banks in Nebraska.3 Upon
consummation of the proposed acquisition, Norwest
would remain the largest bank holding company in
Nebraska with approximately 8.9 percent of the total
deposits in commercial banks in the state.
Although Norwest is an out-of-state bank holding
company for purposes of the BHC Act, Nebraska has
specifically authorized this interstate acquisition by
statute as required by section 3(d) of the Act
(12 U.S.C. 1842(d)). Section 8-903 of the Revised
Statutes of Nebraska authorizes any out-of-state bank
holding company that controlled two or more banks in
Nebraska on March 12, 1963, to acquire additional
banks in Nebraska provided only that the out-of-state
company may not control more than nine banks or 9
percent of the total deposits in commercial banks and
savings and loan associations in the state.4 If the
1. All banking data are as of December 31, 1983, unless otherwise
indicated.
2. The data involving the percentage of total deposits in commercial banks in Nebraska are as of June 30, 1983.
3. These figures include the deposits of BON's two industrial bank
subsidiaries that will be merged into Bank, but they exclude the
deposits of BON's industrial bank in Hastings, Nebraska, which will
be divested prior to consummation of this proposed acquisition.
4. A similar Iowa statute was found to be constitutional as a
legitimate grandfathering of existing companies operating in Iowa,
despite the fact that Norwest was the only out-of-state company to
qualify.
471
deposits of savings and loan associations are included,
Norwest controlled approximately 6.43 percent of the
total deposits in Nebraska thrifts and commercial
banks as of December 31, 1983.
BON is the largest of the five commercial banks in
the Grand Island banking market,5 controlling 38.2
percent of total deposits of commercial banks in the
market. Norwest does not compete in the Grand
Island banking market. Accordingly, the proposal
would not result in the elimination of any existing
competition in this market.
The Board also has considered the effects of Norwest's proposal on probable future competition in the
Grand Island market in light of its proposed guidelines
for determining whether an intensive examination of a
proposed market extension merger or acquisition is
warranted.6 The proposal does not trigger an intensive
analysis under the Board's proposed guidelines because the market is not highly concentrated. Accordingly, consummation of this proposal would have no
significant effect on probable future competition in the
Grand Island banking market.
The financial and managerial resources of Norwest
are considered to be consistent with approval of these
proposals. The financial and managerial resources of
BON will be improved as a result of its acquisition by
Norwest. The future prospects of Bank are favorable.
Considerations relating to convenience and needs of
the communities to be served, including considerations under the Community Reinvestment Act, also
are consistent with approval.
Norwest will indirectly acquire two of BON's industrial bank subsidiaries located in Nebraska.7 These
subsidiaries will be merged into Bank prior to consummation of the proposed transaction.
Norwest proposes to acquire Bankshares Life, a
company engaged in reinsurance and underwriting of
credit life and credit accident and health insurance
directly related to extensions of credit by BON's
subsidiaries. These insurance underwriting activities
have been determined by the Board to be closely
related to banking (12 CFR 225.25(b)(9)).
Norwest also proposes to engage in general insurance agency activities in Nebraska through acquisition
of the insurance agency operated directly by BON.
Title VI of the Garn-St Germain Act of 1982 amended
5. The Grand Island banking market is defined as Hall County,
Nebraska.
6. "Proposed Policy Statement of the Board of Governors of the
Federal Reserve System for Assessing Competitive Factors Under the
Bank Merger Act and the Bank Holding Company Act," 47 Federal
Register 9017 (March 3, 1982).
7. A third industrial bank subsidiary of BON located in Hastings,
Nebraska, will be divested prior to consummation of this proposed
acquisition.
472
Federal Reserve Bulletin • May 1984
section 4(c)(8) of the BHC Act to provide that insurance agency activities are not "closely related to
banking" and thus are not permissible activities for
bank holding companies, unless the activities are
included within one of seven specific exemptions (A
through G) contained in section 4(c)(8). Norwest
claims it is authorized to engage in general insurance
agency activities under exemption G which permits
those bank holding companies that received Board
approval prior to 1971 to engage in insurance agency
activities to continue to engage in such activities.
Unless Norwest's proposal qualifies under this exemption or some other exemption in section 4(c)(8), the
operation of a general insurance agency is not presently a permissible activity for bank holding companies.
Norwest has been engaged in general insurance
agency operations since 1929. In 1959, Norwest received approval from the Board under the provisions
of the Bank Holding Company Act of 1956 to retain
eight insurance agencies which Norwest had organized
into two subsidiaries.8 Both of these subsidiaries engaged in general insurance agency activities, and Norwest has been engaged in general insurance agency
activities on a continuous basis since receiving Board
approval in 1959. Norwest is one of 16 active companies that qualify for exemption G.
In a previous Order the Board interpreted exemption G to permit a qualifying bank holding company to
engage in insurance agency activities without limiting
those activities to the locations where the company did
business prior to 1971.9 The issue raised by this
application is whether the bank holding companies
that received Board approval to engage in general
insurance agency activities before the effective date of
1970 amendments to the BHC Act may act as agent in
the sale of types of insurance that those companies
may not have actually offered prior to 1971. Norwest
asserts that its approval by the Board to retain a
general insurance agency in 1959 permits it to operate
a general insurance agency offering any type of insurance in Nebraska without regard to whether it will sell
only those types of insurance it may have sold prior to
1971.
The Board, in approving the application of Norwest
to engage in such general insurance agency activities
prior to 1971, did not attempt to limit or restrict the
types of insurance that Norwest could sell. By this
application, therefore, Norwest is seeking only to
engage in the same type of general insurance agency
activities that it was engaged in prior to 1971. The fact
that it may offer a new insurance product is irrelevant
since it received approval in 1959 to sell any type of
insurance and the sale of new types of insurance, if
any are contemplated through BON, is within the
scope of Norwest's original 1959 authorization. Accordingly, for those companies that engaged in general
insurance agency activities pursuant to Board approval prior to 1971, the continued operation of general
insurance agencies, without restriction as to type of
insurance sold, is permissible under exemption G of
section 4(c)(8) of the BHC Act.
Norwest's finance company subsidiary, Norwest
Financial Services, Inc., Des Moines, Iowa ("NFS"),
operates an office in Grand Island, Nebraska, and it
competes in the areas of consumer and commercial
lending with Bank. NFS began to expand its small
business lending activity in mid-1982 upon its acquisition by Norwest,10 and does not have a significant
market share. Moreover, there are many competing
financial institutions offering these commercial lending
services. Accordingly, there will be no significant
elimination of competition in the area of commercial
lending.
The relevant market for consumer lending is considered to be Hall County. Although this proposal will
result in elimination of a consumer lending competitor,
there remain 20 alternative sources of consumer loans.
Moreover, Bank's share of the consumer loan market
is approximately 3 percent, and the competitive effect
of this acquisition on consumer financial services in
the Grand Island market is not substantially adverse.
There is evidence in the record indicating that
consummation of Norwest's proposal would not result
in any undue concentration of resources, conflicts of
interests, unsound banking practices, or other adverse
effects. Moreover, the Board also has determined that
the balance of the public interest factors the Board is
required to consider under section 4(c)(8) of the Act is
favorable. Norwest will provide a source for insurance
that will be particularly convenient for its customers.
It has indicated that it will act affirmatively to ensure
compliance with all laws and regulations prohibiting
tie-ins. It will engage in underwriting and reinsurance
activities at rates below the maximum authorized
rates.
Based on the foregoing and other facts of record, the
Board has determined that the applications under
sections 3 and 4 of the Act should be approved. The
acquisition of BON's banking subsidiary pursuant to
section 3 of the Act shall not be consummated before
the thirtieth calendar day following the effective date
of this Order. The acquisition of BON's banking and
nonbanking subsidiaries shall not be consummated
8 . 4 5 FEDERAL RESERVE B U L L E T I N 9 6 3 ( 1 9 5 9 ) .
9. S e e Norwest
Corporation,
(1984).
70 FEDERAL RESERVE BULLETIN 235
10. 6 8 F E D E R A L RESERVE B U L L E T I N 5 1 9 ( 1 9 8 2 ) .
Legal Developments
later than three months after the effective date of this
Order, unless such period is extended for good cause
by the Board or by the Federal Reserve Bank of
Minneapolis, pursuant to delegated authority. The
approval of Norwest's proposal to acquire BON's
nonbanking subsidiaries and activities is subject to the
conditions set forth in section 225.23(b) of Regulation
Y (12 CFR § 225.23(b)) and to the Board's authority to
require modification or termination of the activities of
a holding company or any of its subsidiaries as the
Board finds necessary to assure compliance with the
provisions and purposes of the Act and the Board's
regulations and orders issued thereunder, or to prevent evasion thereof.
By order of the Board of Governors, effective
April 24, 1984.
Voting for this action: Vice Chairman Martin and Governors Wallich, Partee, Rice, and Gramley. Governor Wallich
abstained from the insurance portion of these applications.
Absent and not voting: Chairman Volcker and Governor
Teeters.
JAMES MCAFEE,
[SEAL]
Associate Secretary of the Board
Orders Issued Under Bank Merger
Act
St. Ansgar State Bank
St. Ansgar, Iowa
Order Approving Merger of Banks
St. Ansgar State Bank, St. Ansgar, Iowa, has applied
for approval under the Bank Merger Act (12 U.S.C.
§ 1828(c)) ("Act") to merge with Stacyville Savings
Bank, Stacyville, Iowa ("Bank"). The surviving bank
will operate under the charter and name of St. Ansgar
State Bank.
Notice of the proposed merger has been given in
accordance with the Bank Merger Act and the Board's
Rules of Procedure (12 CFR § 262.3(b)). As required
by the Bank Merger Act, reports on competitive
factors have been requested from the Attorney General, the Comptroller of the Currency, and the Federal
Deposit Insurance Corporation. The time for filing
comments and views has expired, and the application
and all comments received have been considered in
light of the factors set forth in the Act.
Applicant, a state-chartered bank, controls deposits
of $37 million1 and is among Iowa's smaller banking
1. Unless otherwise noted, market and deposit data are as of
June 30, 1983.
473
organizations with 0.17 percent of total deposits in
commercial banks in the state. Bank is also one of the
state's smallest banking organizations, controlling $9
million in deposits. Upon consummation of the proposed merger, Applicant's share of statewide deposits
would increase by approximately 0.04 percent. Consummation of the proposal thus would have no appreciable effect on the concentration of banking resources
in Iowa.
Applicant and Bank compete in the Mitchell County
banking market.2 Applicant is the second largest of six
banks in the market, controlling 26.3 percent of total
deposits in commercial banks in the market. Bank is
the fifth largest bank in the market, with 6.7 percent of
total deposits in commercial banks in the market.
Upon consummation of this proposal, Applicant
would become the largest commercial bank in the
market and would control 33.0 percent of market
deposits. The Mitchell County banking market is highly concentrated, with a four-firm concentration ratio of
90.5 percent and a Herfindahl-Hirschman Index
("HHI") of 2229. Upon consummation of the proposed transaction, the four-firm concentration ratio
would increase to 97.2 percent and the HHI would
increase by 362 points to 2591.
Although consummation of this proposal would result in the elimination of existing competition, several
factors mitigate the competitive effects of the proposal. The Board has considered the fact that Mitchell
County3 is a sparsely populated area that has experienced a significant decline in population.4 In addition,
Mitchell County has a lower population-per-bank ratio
than its neighboring counties or the statewide average.
Mitchell County also has fewer residents per bank
office than the state average and fewer residents per
bank office than all but one of its neighboring counties.5
The Board also has considered the fact that Bank,
with total deposits of only $9.3 million, is among the
2. The Mitchell County banking market is approximated by all of
Mitchell County, Iowa, and Oak Dale, Chester, Jamestown, and
Sarasota townships in Howard County, Iowa. Applicant contends that
a more appropriate definition of the market would be an area
encompassed within a 20-mile radius of St. Ansgar, Iowa, and
Stacyville, Iowa. Upon a review of the data provided by Applicant,
the Board continues to believe that the Mitchell County banking
market as defined above remains the relevant market for Applicant's
and Bank's services.
3. Mitchell County, Iowa, is used as an approximation of the
Mitchell County banking market in view of the ready availability of
relevant data at the county level.
4. 1980 census data indicates that Mitchell County's population has
declined by 5.9 percent since 1970. Only five of Iowa's ninety-nine
counties experienced a more significant decline in population.
5. Bureau of the Census, 1980 Census of Population and Housing,
Final Counts (March 1981). Federal Deposit Insurance Corporation,
Bank and Branches Data Book (June 30, 1982).
474
Federal Reserve Bulletin • May 1984
smallest depository institutions in the state and in the
Mitchell County banking market. Moreover, Bank has
experienced a very low rate of growth since its establishment in 1911. In addition, the record indicates that
Bank's share of deposits in the Mitchell County banking market has slowly declined from 8.6 percent in
1973 to 7.5 percent in 1978, and again to 6.7 percent in
1983.6 Comparative data regarding Bank's mix of
products and services likewise indicates that Bank has
not been an active competitive factor in the market.
Consequently, the Board has determined that, in
view of all of the facts of record and in the particular
context of a declining market containing a relatively
large number of banks, and the proposed merger of a
very small, relatively noncompetitive organization,
consummation of this proposal would not have a
significant adverse effect on existing competition in
the Mitchell County banking market. Thus, competitive effects are consistent with approval.
The financial and managerial resources of Applicant
and Bank are regarded as generally satisfactory and
their prospects appear favorable. Accordingly, considerations relating to banking factors are consistent with
approval.
The proposed transaction would enhance the quantity and quality of services offered by Bank. Bank's
weekly hours of operation would increase by 72 per6. In the last two years alone, Bank's share of market deposits fell
by 0.7 percent—10 percent of Bank's total market share.
ORDERS APPROVED
UNDER BANK HOLDING
cent. Customers of Bank also would benefit from the
addition of new or enhanced services, including the
offering of Individual Retirement Accounts as well as
expanded credit programs and financial services especially developed for local agricultural and commercial
operations. Thus, considerations relating to convenience and needs of the community to be served are
consistent with approval and outweigh any adverse
effects of the transaction.
Based on the foregoing and all the facts of record, it
is the Board's judgment that consummation of the
transaction would be consistent with the public interest. On the basis of the record and for the reasons
summarized above, the Board has determined that the
application should be, and hereby is, approved. The
transaction shall not be consummated before the thirtieth day following the effective date of this Order, or
later than three months after the effective date of this
Order, unless such period is extended for good cause
by the Board or by the Federal Reserve Bank of
Chicago, pursuant to delegated authority.
By order of the Board of Governors, effective
April 12, 1984.
Voting for this action: Vice Chairman Martin and Governors Wallich, Partee, Rice, and Gramley. Absent and not
voting: Chairman Volcker and Governor Teeters.
JAMES MCAFEE,
[SEAL]
COMPANY
Associate Secretary of the Board
ACT BY THE BOARD OF
GOVERNORS
During April 1984 the Board of Governors approved the applications listed below. Copies are available upon
request to Publications Services, Division of Support Services, Board of Governors of the Federal Reserve
System, Washington, D.C. 20551
Section 3
Applicant
Charter 95 Corporation,
Hudson, Wisconsin
McKenzie County Bancorp,
Watford City, North Dakota
Paducah Bank Shares, Inc.,
Paducah, Kentucky
Salem Capital Corporation,
Elkhart, Indiana
Bank
Hammond State Bank,
Hammond, Wisconsin
The McKenzie County National Bank,
Watford City, North Dakota
The Paducah Bank & Trust Company,
Paducah, Kentucky
Salem Financial Corporation,
Goshen, Indiana
Board action
(effective date)
date)
April 27, 1984
April 10, 1984
April 6, 1984
April 5, 1984
Legal Developments
By Federal Reserve
475
Banks
Recent applications have been approved by the Federal Reserve Banks as listed below. Copies of the orders are
available upon request to the Reserve Banks.
Section 3
Applicant
Acorn Bankshares, Inc.,
Bloomingdale, Illinois
Banner County Bancorp,
Harrisburg, Nebraska
Battle Lake Bancshares, Inc.,
Battle Lake, Minnesota
Baxley State Banking Company,
Baxley, Georgia
Bippus State Corporation,
Bippus, Indiana
Blountsville Bancshares, Inc.,
Blountsville, Alabama
BNB Bancorp,
Burbank, California
Brownsville Bancshares Corporation,
Brownsville, Tennessee
CSB Bancorp,
Petersburg, Indiana
Central Financial Group, Inc.,
Monticello, Illinois
Central Louisiana Capital Corporation,
Ferriday, Louisiana
Churubusco Bancorp,
Churubusco, Indiana
Chester State Bancshares, Inc.,
Chester, Texas
Childersburg Bancorporation,
Inc.,
Childersburg, Alabama
Citizens and Southern Georgia
Corporation,
Atlanta, Georgia
Citizens Guaranty Bancshares,
Inc.,
Irvine, Kentucky
Citizens Security Bancshares,
Inc.,
Bixby, Oklahoma
Bank(s)
Bloomingdale State Bank,
Bloomingdale, Illinois
Banner County Bank,
Harrisburg, Nebraska
The First National Bank of
Battle Lake,
Battle Lake, Minnesota
Baxley State Bank,
Baxley, Georgia
The Bippus State Bank,
Bippus, Indiana
The Bank of Blountsville,
Blountsville, Alabama
Burbank National Bank,
Burbank, California
Brownsville Bank,
Brownsville, Tennessee
Reserve
Bank
Effective
date
Chicago
March 23, 1984
Kansas City
March 19, 1984
Minneapolis
March 23, 1984
Atlanta
March 30, 1984
Chicago
March 20, 1984
Atlanta
April 5, 1984
San Francisco
March 21, 1984
St. Louis
April 5, 1984
St. Louis
April 9, 1984
Chicago
April 5, 1984
Dallas
April 9, 1984
Chicago
April 5, 1984
Dallas
April 11, 1984
Atlanta
March 19, 1984
FSB Bancorp, Inc.,
Peachtree City, Georgia
Atlanta
March 27, 1984
Citizens Guaranty Bank,
Irvine, Kentucky
Cleveland
April 11, 1984
Citizens Security Bank and
Trust Company,
Bixby, Oklahoma
Kansas City
April 11, 1984
The Citizens State Bank of
Petersburg,
Petersburg, Indiana
National Bank of Monticello,
Monticello, Illinois
De Land State Bank,
De Land, Illinois
Louisiana Central Bank,
Ferriday, Louisiana
Churubusco State Bank,
Churubusco, Indiana
First State Bank,
Colmesneil, Texas
First Bank of Childersburg,
Childersburg, Alabama
476
Federal Reserve Bulletin • May 1984
Section 3—Continued
Applicant
Collier Bancshares Holding
Company, Inc.,
McAllen, Texas
Lower Rio Grande Valley Bancshares, Inc.,
La Feria, Texas
Colony Bankcorp, Inc.,
Fitzgerald, Georgia
Commercial Bancshares, Inc.,
Jersey City, New Jersey
Commercial Landmark Corporation,
Muskogee, Oklahoma
Crystal Valley Financial Corporation,
Middlebury, Indiana
Elkhart Bancorp, Inc.,
Elkhart, Indiana
F and M Holding Company,
Manchester, Georgia
Farmers State Bancorp, Inc.,
Booneville, Kentucky
First and Ocean BanCorp,
Newburyport, Massachusetts
First Bancorp, Inc.,
Mechanicsburg, Pennsylvania
First Burkburnett Bancshares,
Inc.,
Burkburnett, Texas
First Citizens United, Inc.,
Central City, Kentucky
First Commercial Corporation,
Little Rock, Arkansas
First Community Bancorp, Inc.,
Nazareth, Pennsylvania
First Carolina Bancshares Corporation,
Darlington, South Carolina
First Galena Bancshares, Inc.,
Galena, Illinois
First Haralson Corporation,
Buchanan, Georgia
First Lake Forest Corporation,
Lake Forest, Illinois
Bank(s)
Reserve
Bank
Effective
date
City National Bank,
Weslaco, Texas
Dallas
March 20, 1984
Pitts Banking Company,
Pitts, Georgia
The Wood Ridge National Bank,
Wood Ridge, New Jersey
Commercial Bancshares, Inc.,
Tulsa, Oklahoma
Atlanta
March 23, 1984
New York
April 19, 1984
Kansas City
April 6, 1984
First State Bank of Middlebury,
Middlebury, Indiana
Chicago
April 11, 1984
Citizens Northern Bank of
Elkhart,
Elkhart, Indiana
F & M Bank and Trust Company,
Manchester, Georgia
Farmers State Bank,
Boone ville, Kentucky
First and Ocean National Bank of
Newburyport,
Newburyport, Massachusetts
The First Bank and Trust Company of Mechanicsburg, Pa.,
Mechanicsburg, Pennsylvania
First National Bank in Burkburnett,
Burkburnett, Texas
Citizens Union Bank,
Central City, Kentucky
Morrilton Security Bank,
Morrilton, Arkansas
The Second National Bank of
Nazareth,
Nazareth, Pennsylvania
Carolina Bank & Trust Company,
Lamar, South Carolina
Chicago
March 19, 1984
Atlanta
April 10, 1984
Cleveland
March 20, 1984
Boston
April 9, 1984
Philadelphia
April 13, 1984
Dallas
March 23, 1984
St. Louis
April 6, 1984
St. Louis
April 2, 1984
Philadelphia
April 4, 1984
Richmond
April 13, 1984
The First National Bank of
Galena,
Galena, Illinois
First National Bank of Haralson
County,
Buchanan, Georgia
The First National Bank of
Lake Forest,
Lake Forest, Illinois
Chicago
March 27, 1984
Atlanta
March 19, 1984
Chicago
March 21, 1984
Legal Developments
Section 3—Continued
Applicant
Bank(s)
First McMinnville Corporation,
McMinnville, Tennessee
The First National Bank of
McMinnville,
McMinnville, Tennessee
First State Bank,
Holly Springs, Mississippi
First State Bank of Altus,
Altus, Oklahoma
The Bank of McMechen,
McMechen, West Virginia
Iowa National Bank & Trust,
Lytton, Iowa
Central Texas Financial Corporation,
Georgetown, Texas
The National Bank of Harrah,
Harrah, Oklahoma
First State Capital Corporation,
Holly Springs, Mississippi
FSB Bancorp, Inc.,
Altus, Oklahoma
Gateway Bancshares, Inc.,
McMechen, West Virginia
Geiger Corporation,
Edina, Minnesota
Greater Texas Bancshares, Inc.,
Georgetown, Texas
Harrah National Bancshares,
Inc.,
Harrah, Oklahoma
Heritage Bancorp, Inc.,
Glenville, West Virginia
Huntington Bancshares, Inc.,
Huntington, Texas
Independence Bancorp, Inc.,
Allendale, New Jersey
Independent Bancshares, Inc.,
Red Bay, Alabama
Independent Community Banks,
Inc.,
Sanibel, Florida
Jeff City Bancorp, Inc.,
Woodlawn, Illinois
Kent Bancshares, Inc.,
Kent, Minnesota
Key Bancshares, Inc.,
Tampa, Florida
Landmark Bancshares Corporation,
Clayton, Missouri
Lewisville Bancorp, Inc.,
Lewisville, Minnesota
Mammoth Investments & Credit
Corp., Inc.,
Mammoth Spring, Arkansas
McAllen Metropolitan
Bancshares, Inc.,
McAllen, Texas
Mid-Cities Bancshares, Inc.,
Hurst, Texas
Kanawha Union Bank,
Glenville, West Virginia
The Weston National Bank,
Glenville, West Virginia
Huntington State Bank,
Huntington, Texas
Bank of New Jersey,
Allendale, New Jersey
Bank of Red Bay,
Red Bay, Alabama
Community National Bank,
Kissimmee, Florida
First National Bank of Woodlawn,
Woodlawn, Illinois
Kent State Bank,
Kent, Minnesota
Key Bank of Florida,
Tampa, Florida
The First National Bank of
St. Charles,
St. Charles, Missouri
Merchants State Bank of
Lewisville,
Lewisville, Minnesota
Peoples Bank of Mammoth
Spring,
Mammoth Spring, Arkansas
Metropolitan National Bank,
McAllen, Texas
Mid-Cities National Bank,
Hurst, Texas
Reserve
Bank
Effective
date
Atlanta
April 6, 1984
St. Louis
April 16, 1984
Kansas City
April 9, 1984
Cleveland
April 2, 1984
Chicago
April 9, 1984
Dallas
April 2, 1984
Kansas City
April 5, 1984
Richmond
April 3, 1984
Dallas
April 3, 1984
New York
April 13, 1984
Atlanta
March 27, 1984
Atlanta
March 26, 1984
St. Louis
April 3, 1984
Minneapolis
March 20, 1984
Atlanta
April 13, 1984
St. Louis
March 23, 1984
Minneapolis
April 9, 1984
St. Louis
April 3, 1984
Dallas
April 3, 1984
Dallas
April 4, 1984
All
478
Federal Reserve Bulletin • May 1984
Section 3—Continued
Applicant
Monroe Bancorp,
Bloomington, Indiana
Ninnescah Banc Shares, Inc.,
Arlington, Kansas
NBC Capital Corporation,
Starkville, Mississippi
Ohio Bancorp,
Youngstown, Ohio
Pan American Banks, Inc.,
Miami, Florida
Pan American Banks, Inc.,
Miami, Florida
Professional Bancorp,
Coral Gables, Florida
Rose Capital Bancshares, Inc.,
Tyler, Texas
Rural Financial Services, Inc.,
Dousman, Wisconsin
Saver's Bancorp, Inc.,
Littleton, New Hampshire
Schwertner Financial
Corporation,
Schwertner, Texas
Sevier County Bancshares, Inc.,
Sevierville, Tennessee
Shamrock Holdings, Inc.,
Evergreen, Alabama
Texas Commerce Bancshares,
Inc.,
Houston, Texas
Texas Gulf Coast Bancorp, Inc.,
Houston, Texas
Texas Regional Bancshares,
Inc.,
McAllen, Texas
Texas Southwest Bancorp, Inc.,
Mesquite, Texas
The First Jermyn Corp.,
Jermyn, Pennsylvania
The Merchants Holding
Company,
Winona, Minnesota
Bank(s)
Reserve
Bank
Effective
date
Monroe County State Bank,
Bloomington, Indiana
Arlington Insurance Agency,
Arlington, Kansas
National Bank of Commerce of
Mississippi,
Starkville, Mississippi
The Union Commercial &
Savings Bank,
East Palestine, Ohio
Central Bank of Delray Beach,
Delray Beach, Florida
Royal Trust Bank of Jacksonville,
Jacksonville, Florida
Dixie National Bank of Dade
County,
Miami, Florida
Rose Capital Bank,
Tyler, Texas
Dousman State Bank,
Dousman, Wisconsin
Mansfield State Bank,
Johnson Creek, Wisconsin
The Saver's Bank,
Littleton, New Hampshire
North Country Bank,
Berlin, New Hampshire
Schwertner State Bank,
Schwertner, Texas
Chicago
April 5, 1984
Kansas City
April 2, 1984
St. Louis
April 11, 1984
Cleveland
March 20, 1984
Atlanta
March 30, 1984
Atlanta
March 30, 1984
Atlanta
March 30, 1984
Dallas
April 10, 1984
Chicago
April 6, 1984
Boston
March 22, 1984
Dallas
April 9, 1984
Sevier County Bank,
Sevierville, Tennessee
The Union Bank,
Repton, Alabama
Texas Commerce Bank-River
Oaks, N.A.,
Houston, Texas
Mainland Bancshares, Inc.,
Houston, Texas
Texas State Bank,
Mc Allen, Texas
Harlingen State Bank,
Harlingen, Texas
Southwest Bank-Garland,
Garland, Texas
The First National Bank of
Jermyn,
Jermyn, Pennsylvania
The Merchants National Bank,
Winona, Minnesota
Atlanta
April 18, 1984
Atlanta
April 17, 1984
Dallas
April 3, 1984
Dallas
March 23, 1984
Dallas
March 21, 1984
Dallas
April 5, 1984
Philadelphia
April 4, 1984
Minneapolis
April 2, 1984
Legal Developments
Section 3—Continued
Applicant
Tucker Bros., Inc.,
Jacksonville, Florida
Turner Bancshares, Inc.,
Kansas City, Kansas
TCB Corporation,
Greenwood, South Carolina
USBANCORP, Inc.,
Johnstown, Pennsylvania
Van Alstyne Financial
Corporation,
Van Alstyne, Texas
Washington Trust Bancorp,
Inc.,
Westerly, Rhode Island
Waverly Bancshares, Inc.,
Waverly, Missouri
Wayne Bancorp, Inc.,
Wayne, West Virginia
Wesbanco, Inc.,
Wheeling, West Virginia
West Banco,
Bozeman, Montana
Westport Bancorp, Inc.,
Westport, Connecticut
Whitney Corporation of Iowa,
Atlantic, Iowa
Willow Bend Bancshares, Inc.,
Piano, Texas
Wolcott Bancorp, Inc.,
Wolcott, Indiana
Yoder Bankshares, Inc.,
Yoder, Kansas
Bank(s)
Tucker Holding Company, Inc.,
Jacksonville, Florida
Tucker Bank of Jacksonville,
Jacksonville, Florida
Turner State Bank,
Kansas City, Kansas
The County Bank,
Greenwood, South Carolina
Three Rivers Bank & Trust
Company,
Pittsburgh, Pennsylvania
First National Bank of Van
Alstyne,
Van Alstyne, Texas
The Washington Trust Company
of Westerly,
Westerly, Rhode Island
Waverly Investment Company,
Kansas City, Missouri
Wayne County Bank,
Wayne, West Virginia
Citizens National Bank of
Follansbee,
Follansbee, West Virginia
First Security Bank of West
Yellowstone,
West Yellowstone, Montana
The Westport Bank and Trust
Company,
Westport, Connecticut
Schroeder-Goodenow
Management Co.,
Exira, Iowa
Willow Bend National Bank,
Piano, Texas
Bank of Wolcott,
Wolcott, Indiana
Farmers State Bank,
Yoder, Kansas
Reserve
Bank
Effective
date
Atlanta
March 23, 1984
Kansas City
April 6, 1984
Richmond
March 27, 1984
Philadelphia
March 26, 1984
Dallas
March 21, 1984
Boston
April 9, 1984
Kansas City
March 19, 1984
Richmond
April 2, 1984
Cleveland
March 26, 1984
Minneapolis
April 2, 1984
New York
April 13, 1984
Chicago
March 27, 1984
Dallas
March 21, 1984
Chicago
March 20, 1984
Kansas City
April 5, 1984
Section 4
Nonbanking
company
American Bancorporation
Holding Company,
Brainerd, Minnesota
Thorp Credit and Thrift,
Brainerd, Minnesota
Reserve
Bank
Effective
date
Minneapolis
March 22, 1984
479
480
Federal Reserve Bulletin • May 1984
Section 4—Continued
Applicant
American Ligonier Bancorp,
Inc.,
Ligonier, Indiana
Bank Shares Incorporated,
Minneapolis, Minnesota
First Interstate Bancorp,
Los Angeles, California
First Railroad & Banking
Company of Georgia,
Augusta, Georgia
Pickens County Bancshares,
Inc.,
Jasper, Georgia
Security Pacific Corporation,
Los Angeles, California
Security Pacific Corporation,
Los Angeles, California
Bank(s)
Reserve
Bank
Effective
date
sale of credit-related insurance
Chicago
March 26, 1984
Holm and Associates, Inc.,
Minneapolis, Minnesota
Harris, Bretall, McEldowney and
Sullivan,
Los Angeles, California
Valley Finance Corporation,
Roanoke, Virginia
Minneapolis
April 9, 1984
San Francisco
April 5, 1984
Atlanta
April 11, 1984
Atlanta
March 23, 1984
San Francisco
April 3, 1984
San Francisco
March 22, 1984
Northeastern General Insurance
Agency of Jasper,
Jasper, Georgia
KMS Corporate Brokers, Inc.,
New York, New York
Regal Premium Finance, Inc.,
Maple Shade, New Jersey
Section 3 and 4
Applicant
Canton Bancshares, Inc.,
Canton, South Dakota
Chokio Agency, Inc.,
Chokio, Minnesota
MNB Bancshares, Inc.,
Malvern, Arkansas
Nicholls State Bancshares, Inc.,
Nicholls, Georgia
Bank(s)/Nonbanking
Company
First American Bank,
Canton, South Dakota
Fairview Insurance Agency,
Canton, South Dakota
Chokio State Bank,
Chokio, Minnesota
general insurance agency
activities
The Malvern National Bank,
Malvern, Arkansas
real estate appraisal
Nicholls State Bank,
Nicholls, Georgia
Full Service Financial, Inc.,
Pearson, Georgia
Reserve
Bank
Effective
date
Minneapolis
April 5, 1984
Minneapolis
March 27, 1984
St. Louis
March 26, 1984
Atlanta
March 30, 1984
Legal Developments
PENDING
CASES INVOLVING
THE BOARD
OF
481
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.
Colorado Industrial Bankers Association v. Board of
Governors, filed January 1984, U.S.C.A. for the
Tenth Circuit.
Financial Institutions Assurance Corp. v. Board of
Governors, filed January 1984, U.S.C.A. for the
Fourth Circuit.
First Bancorporation v. Board of Governors, filed
January 1984, U.S.C.A. for the Tenth Circuit.
Thomas H. Huston v. Board of Governors, filed
January 1984, U.S.C.A. for the Eighth Circuit.
Ohio Deposit Guarantee Fund v. Board of Governors,
filed January 1984, U.S.C.A. for the Tenth Circuit.
State of Ohio, et al. v. Board of Governors, filed
January 1984, for the Tenth Circuit.
Dimension Financial Corporation, et al. v. Board of
Governors, filed December 1983, U.S.C.A. for the
Tenth Circuit.
Oklahoma Bankers Association v. Federal Reserve
Board, filed December 1983, U.S.C.A. for the Tenth
Circuit.
Independent Insurance Agents of America, Inc. and
Independent Insurance Agents of Missouri, Inc. v.
Board of Governors, filed June 1983, U.S.C.A. for
the Eighth Circuit (two cases).
The Committee for Monetary Reform, et al. v. Board
of Governors, filed June 1983, U.S.D.C. for the
District of Columbia Circuit.
Securities Industry Association v. Board of Governors, et al., filed February 1983, Supreme Court.
Association of Data Processing Service Organizations, et al. v. Board of Governors, filed August
1982, U.S.C.A. for the District of Columbia Circuit.
Wyoming Bancorporation v. Board of Governors, filed
May 1982, U.S.C.A. for the Tenth Circuit.
Edwin F. Gordon v. Board of Governors, et al., filed
October 1981, U.S.C.A. for the Eleventh Circuit
(two consolidated cases).
Edwin F. Gordon v. John Heimann, et al., filed
September 1981, U.S.C.A. for the Eleventh Circuit.
Allen Wolfson v. Board of Governors, filed September
1981, U.S.D.C. for the Middle District of Florida.
Public Interest Bounty Hunters v. Board of Governors, et al., filed June 1981, U.S.C.A. for the
Eleventh Circuit.
First Bank & Trust Company v. Board of Governors,
filed February 1981, U.S.D.C. for the Eastern District of Kentucky.
9 to 5 Organization for Women Office Workers v.
Board of Governors,
filed December 1980,
U.S.C.A. for the First Circuit.
A. G. Becker, Inc. v. Board of Governors, et al., filed
October 1980, U.S.C.A. for the District of Columbia.
A. G. Becker, Inc. v. Board of Governors, et al., filed
August 1980, Supreme Court.
A1
Financial and Business Statistics
CONTENTS
Domestic
A3
A4
A5
A5
A9
Financial
Statistics
Monetary aggregates and interest rates
Reserves of depository institutions, Reserve
Bank credit
Reserves and borrowings of depository
institutions
Federal funds and repurchase agreements of
large member banks
POLICY
A6
A7
A8
WEEKLY REPORTING
INSTRUMENTS
Federal Reserve Bank interest rates
Reserve requirements of depository institutions
Maximum interest rates payable on time and
savings deposits at federally insured institutions
Federal Reserve open market transactions
FEDERAL RESERVE
Assets and liabilities
A18
All reporting banks
A19
Banks in New York City
A20 Balance sheet memoranda
A20
Branches and agencies of foreign banks
A21 Gross demand deposits of individuals,
partnerships, and corporations
FINANCIAL
MARKETS
A22 Commercial paper and bankers dollar
acceptances outstanding
A22 Prime rate charged by banks on short-term
business loans
A23 Terms of lending at commercial banks
A24 Interest rates in money and capital markets
A25 Stock market—Selected statistics
A26 Selected financial institutions—Selected assets
and liabilities
FEDERAL
MONETAR Y AND CREDIT
AGGREGATES
A12 Aggregate reserves of depository institutions
and monetary base
A13 Money stock measures and components
A14 Bank debits and deposit turnover
A15 Loans and securities of all commercial banks
BANKING
INSTITUTIONS
A16 Major nondeposit funds
A17 Assets and liabilities, last-Wednesday-of-month
series
BANKS
BANKS
A10 Condition and Federal Reserve note statements
A l l Maturity distribution of loan and security
holdings
COMMERCIAL
COMMERCIAL
All
A28
A29
A29
FINANCE
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, positions, and financing
A31 Federal and federally sponsored credit
agencies—Debt outstanding
2
Federal Reserve Bulletin • May 1984
SECURITIES
CORPORATE
International
MARKETS
AND
FINANCE
A32 New security issues—State and local
governments and corporations
A33 Open-end investment companies—Net sales and
asset position
A33 Corporate profits and their distribution
A34 Nonfinancial corporations—Assets and
liabilities
A34 Total nonfarm business expenditures on new
plant and equipment
A35 Domestic finance companies—Assets and
liabilities and business credit
REAL
ESTATE
A36 Mortgage markets
A37 Mortgage debt outstanding
CONSUMER
INSTALLMENT
CREDIT
A38 Total outstanding and net change
A39 Terms
FLOW OF
Nonfinancial
Statistics
A42 Nonfinancial business activity—Selected
measures
A42 Output, capacity, and capacity utilization
A43 Labor force, employment, and unemployment
A44 Industrial production—Indexes and gross value
A46 Housing and construction
A47 Consumer and producer prices
A48 Gross national product and income
A49 Personal income and saving
A50
A51
A51
A51
U.S. international transactions—Summary
U.S. foreign trade
U.S. reserve assets
Foreign official assets held at Federal Reserve
Banks
A52 Foreign branches of U.S. banks—Balance sheet
data
A54 Selected U.S. liabilities to foreign official
institutions
REPORTED
BY BANKS
IN THE UNITED
STATES
A54
A55
A57
A58
Liabilities to and claims on foreigners
Liabilities to foreigners
Banks' own claims on foreigners
Banks' own and domestic customers' claims on
foreigners
A58 Banks' own claims on unaffiliated foreigners
A59 Claims on foreign countries—Combined
domestic offices and foreign branches
REPORTED BY NONBANKING
ENTERPRISES IN THE UNITED
BUSINESS
STATES
A60 Liabilities to unaffiliated foreigners
A61 Claims on unaffiliated foreigners
FUNDS
A40 Funds raised in U.S. credit markets
A41 Direct and indirect sources of funds to credit
markets
Domestic
Statistics
SECURITIES
HOLDINGS
AND
TRANSACTIONS
A62 Foreign transactions in securities
A63 Marketable U.S. Treasury bonds and notes—
Foreign holdings and transactions
INTEREST AND EXCHANGE
RATES
A63 Discount rates of foreign central banks
A64 Foreign short-term interest rates
A64 Foreign exchange rates
A65 Guide to Tabular
Presentation,
Statistical Releases, and Special
Tables
Domestic Financial Statistics
A3
1.10 RESERVES, MONEY STOCK, LIQUID ASSETS, AND DEBT MEASURES
Monetary and credit aggregates
(annual rates of change, seasonally adjusted in percent) 1
Item
Q2
Q4
Q3
Reserves of depository
Total
Required
Nonborrowed
Monetary base 3
5
6
7
8
9
Concepts of money, liquid assets, and debt4
Ml
M2
M3
L
Debt
1984
1983
Nov.
Ql
institutions2
1
2
3
4
Nontransaction
10 In M25
11 In M3 only 6
1984
1983
Dec.
Jan.
Feb.
Mar.
11.8
12.0
5.2
10.2
6.0
5.9
2.9
8.2
.5
-.1
8.0
7.8
6.9
4.5
8.2
9.0
-2.4
-3.3
-4.6
7.2
1.2
.1
5.8
6.7
7.6
5.9
9.8
10.7'
19.1
8.1
24.6
10.5'
1.1
9.2
-11.8
.8
11.6
10.6
9.3
10.3
10.7'
9.5
6.9
7.4
9.6
11.5'
4.8
8.5
9.9
8.8'
10.1'
7.2
6.8
8.9
n.a.
n.a.
3.2
8.3
14.4
12.7
9.6
5.3
7.7
8.0
10.7
12.3
10.7
5.7'
6.6'
7.4
12.2'
6.6
8.4'
10.4'
n.a.
12.7
5.2
3.6
8.3
n.a.
n.a.
10.2
3.8
6.1
9.8
9.6
16.3
6.8
17.4
9.9
41.4
8.4
9.2'
4.2'
10.1'
8.9'
18.9'
3.1
28.5
-14.8
-21.2
-14.6
-6.3
13.7
-4.6
-6.4
19.3
-.4
-16.2
4.4
9.0
-7.9
18.1
13.5
13.2
10.6
7.0
-22.3
-.7
8.5
-18.2
-.3
6.3'
-29.1
2.4
23.1
-1.3
-17.0
51.2
-2.2
12.3
63.5
-4.4
18.8
57.6
-5.1
11.8
58.2
-6.7
20.5
34.5
-6.7
12.4
46.0
-3.4
11.2
69.4
-8.8
10.8'
63.3
.7
4.3
3.0
21.2'
8.8'
9.7
12.4'
9.5'
10.2
n.a.
n.a.
13.3
7.0
10.3
13.4
8.5'
13.4
13.7
27.4'
7.8'
11.1
16.6
11.5
15.0
n.a.
n.a.
14.8
components
Time and savings deposits
Commercial banks
Savings7
Small-denomination time 8
Large-denomination time 9 1 0
Thrift institutions
15
Savings7
16 Small-denomination time
17 Large-denomination time 9
12
13
14
Debt components4
18 Federal
19 Nonfederal
20 Total loans and securities at commercial banks"
23.2'
7.3'
9.8
1. Unless otherwise noted, rates of change are calculated from average
amounts outstanding in preceding month or quarter.
2. Figures incorporate adjustments for discontinuities associated with the
implementation of the Monetary Control Act and other regulatory changes to
reserve requirements. To adjust for discontinuities due to changes in reserve
requirements on reservable nondeposit liabilities, the sum of such required
reserves is subtracted from the actual series. Similarly, in adjusting for discontinuities in the monetary base, required clearing balances and adjustments to
compensate for float also are subtracted from the actual series.
3. The monetary base not adjusted for discontinuities consists of total
reserves plus required clearing balances and adjustments to compensate for float
at Federal Reserve Banks plus the currency component of the money stock less
the amount of vault cash holdings of thrift institutions that is included in the
currency component of the money stock plus, for institutions not having required
reserve balances, the excess of current vault cash over the amount applied to
satisfy current reserve requirements. After the introduction of contemporaneous
reserve requirements (CRR), currency and vault cash figures are measured over
the weekly computation period ending Monday.
Before CRR, all components of the monetary base other than excess reserves
are seasonally adjusted as a whole, rather than by component, and excess
reserves are added on a not seasonally adjusted basis. After CRR, the seasonally
adjusted series consists of seasonally adjusted total reserves, which include
excess reserves on a not seasonally adjusted basis, plus the seasonally adjusted
currency component of the money stock plus the remaining items seasonally
adjusted as a whole.
4. Composition of the money stock measures and debt is as follows:
Ml: (1) currency outside the Treasury, Federal Reserve Banks, and the vaults
of commercial banks; (2) travelers checks of nonbank issuers; (3) demand deposits
at all commercial banks other than those due to domestic banks, the U.S.
government, and foreign banks and official institutions less cash items in the
process of collection and Federal Reserve float; and (4) other checkable deposits
(OCD) 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. The currency and demand
deposit components exclude the estimated amount of vault cash and demand
deposits respectively held by thrift institutions to service their OCD liabilities.
M2: Ml plus overnight (and continuing contract) repurchase agreements (RPs)
issued by all commercial banks and overnight Eurodollars issued to U.S. residents
by foreign branches of U.S. banks worldwide, MMDAs, savings and smalldenomination time deposits (time deposits—including retail RPs—in amounts of
less than $100,000), and balances in both taxable and tax-exempt general purpose
and broker/dealer money market mutual funds. Excludes individual retirement
accounts (IRA) 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. Also subtracted is a consolidation adjustment
that represents the estimated amount of demand deposits and vault cash held by
thrift institutions to service their time and savings deposits.
M3: M2 plus large-denomination time deposits and term RP liabilities (in
amounts of $100,000 or more) issued by commercial banks and thrift institutions,
term Eurodollars held by U.S. residents at foreign branches of U.S. banks
worldwide and at all banking offices in the United Kingdom and Canada, and
balances in both taxable and tax-exempt, institution-only money market mutual
funds. Excludes amounts held by depository institutions, the U.S. government,
money market funds, and foreign banks and official institutions. Also subtracted is
a consolidation adjustment that represents the estimated amount of overnight RPs
and Eurodollars held by institution-only money market mutual funds.
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 mutual fund holdings of these assets.
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. The source of data on domestic
nonfinancial debt is the Federal Reserve Board's flow of funds accounts. Debt
data are on an end-of-month basis. Growth rates for debt reflect adjustments for
discontinuities over time in the levels of debt presented in other tables.
5. Sum of overnight RPs and Eurodollars, money market fund balances
(general purpose and broker/dealer), MMDAs, and savings and small time
deposits less the estimated amount of demand deposits and vault cash held by
thrift institutions to service their time and savings deposit liabilities.
6. Sum of large time deposits, term RPs, and Eurodollars of U.S. residents,
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 mutual funds.
7. Excludes MMDAs.
8. Small-denomination time deposits—including retail RPs—are those issued
in amounts of less than $100,000. All IRA and Keogh accounts at commercial
banks and thrifts are subtracted from small time deposits.
9. Large-denomination time deposits are those issued in amounts of $100,000
or more, excluding those booked at international banking facilities.
10. Large-denomination time deposits at commercial banks less those held by
money market mutual funds, depository institutions, and foreign banks and
official institutions.
11. Changes calculated from figures shown in table 1.23. Beginning December
1981, growth rates reflect shifts of foreign loans and securities from U.S. banking
offices to international banking facilities.
A4
1.11
D o m e s t i cNonfinancialS t a t i s t i c s •
M a y 1984
RESERVE BALANCES OF DEPOSITORY INSTITUTIONS AND RESERVE BANK CREDIT
Millions of dollars
Monthly averages of
daily figures
Weekly averages of daily figures for week ending
1984
1984
Feb.
Mar.
Apr.
166,904
168,738
174,313
169,028
169,316
168,956
169,794
171,507
171,564
148,137
148,137
154,226
152,859
1,367
8,660
8,557
103
87
1,285
837
9,219
149,174
148,318
856
8,610
8,564
46
149,897
149,897
151,112
151,112
0
0
152,425
152,425
8,558
8,558
8,557
8,557
0
0
0
0
8,556
8,556
886
1,775
8,581
149,620
148,623
997
8,698
8,558
140
59
1,195
481
8,902
11,114
4,618
15,879
150,442
150,442
588
1,100
8,506
11,118
4,618
15,813
149,546
149,128
418
8,604
8,562
42
14
905
1,002
8,667
11,115
4,618
15,863
1,114
714
8,966
1,513
1,344
8,981
4,618
15,903
751
669
9,162
11,109
4,618
15,915
167,179
485
4,669
214
1,452
Mar. 14
Mar. 21
Mar. 28
Apr. 4
Apr. 11
Apr. 18
SUPPLYING RESERVE F U N D S
1 Reserve Bank credit
2
U.S. government securities'
3
Bought outright
4
Held under repurchase agreements
5
Federal agency obligations
6
Bought outright
7
Held under repurchase agreements
8
Acceptances
9
Loans
10
Float
11
Other Federal Reserve assets
12 Gold stock
13 Special drawing rights certificate account
14 Treasury currency outstanding
0
8,573
8,573
0
0
1
0
8,558
8,558
0
0
0
0
0
11,110
11,116
4,618
15,915
4,618
15,855
1,077
1,091
8,692
11,114
4,618
15,867
168,317
488
170,394
522
168,598
481
168,634
485
168,263
494
169,026
507
170,363
515
170,827
521
4,012
229
1,940
6,637
220
1,215
2,825
224
1,553
5,327
225
1,596
4,358
210
1,548
3,754
236
1,677
3,098
208
1,542
3,964
217
1,525
11,111
11,111
4,618
15,891
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 2
549
579
394
525
667
537
536
429
389
5,492
5,705
6,098
5,634
5,570
5,832
5,874
6,313
5,818
18,414
19,066
20,597
20,776
18,411
19,325
19,805
20,672
19,946
End-of-month figures
Wednesday figures
Apr.
Feb.
Mar. 14
Mar. 21
Mar. 28
Apr. 4
Apr. 11
Apr. 18
SUPPLYING RESERVE F U N D S
23 Reserve Bank credit
161,971
170,168
182,683
174,644
170,957
165,262
169,530
171,860
174,982
24
25
26
27
28
29
30
31
32
33
140,847
140,847
150,814
150,814
162,134
155,042
7,092
8,982
8,556
426
305
907
609
9,746
151,465
148,570
2,895
8,713
8,558
155
5
2,449
3,108
8,904
150,968
150,968
145,670
145,670
151,027
151,027
150,972
150,972
155,409
155,409
U.S. government securities'
Bought outright
Held under repurchase a g r e e m e n t s . . .
Federal agency obligations
Bought outright
Held under repurchase a g r e e m e n t s . . .
Acceptances
Loans
Float
Other Federal Reserve assets
34 Gold stock
35 Special drawing rights certificate account .
36 Treasury currency outstanding
0
0
8,568
8,568
8,558
8,558
0
0
0
0
1,020
3,193
8,343
896
787
9,113
0
0
0
0
0
8,558
8,558
8,558
8,558
8,558
8,558
8,556
8,556
8,556
8,556
935
1,655
8,841
718
1,240
9,076
588
334
9,023
2,425
763
9,144
671
1,003
9,343
0
0
0
0
0
0
0
0
0
0
11,116
11,111
4,618
15,865
11,114
4,618
15,877
11,114
4,618
15,889
11,111
4,618
15,889
11,109
4,618
15,937
11,116
4,618
15,841
4,618
15,901
11,109
4,618
15,913
11,109
4,618
15,925
167,206
484
168,737
503
170,309
534
168,863
484
168,528
493
168,488
503
169,719
513
171,001
520
170,962
528
3,226
247
1,070
498
3,684
16,729
345
1,136
324
2,575
283
1,093
502
5,545
241
1,104
550
3,838
187
1,103
506
4,701
200
1,133
457
2,827
217
1,133
421
7,677
183
1,138
336
ABSORBING RESERVE F U N D S
37 Currency in circulation
38 Treasury cash holdings
Deposits, other than reserve balances with
Federal Reserve Banks
39
Treasury
40
Foreign
41 Service-related balances and adjustments .
42
Other
43 Other Federal Reserve liabilities and
capital
44 Reserve balances with Federal
Reserve Banks 2
221
1,103
562
5,555
5,912
6,391
5,625
5,409
5,595
5,698
5,623
5,671
15,260
21,064
18,579
26,819
20,696
16,663
18,740
21,758
20,139
1. Includes securities loaned—fully guaranteed by U.S government securities
pledged with Federal Reserve Banks—and excludes (if any) securities sold and
scheduled to be bought back under matched sale-purchase transactions.
2. Excludes required clearing balances and adjustments to compensate for
float.
NOTE. For amounts of currency and coin held as reserves, see table 1.12.
Depository
1.12
RESERVES AND BORROWINGS
Institutions
A5
D e p o s i t o r y Institutions
Millions of dollars
Monthly averages of daily figures
Reserve classification
1
2
3
4
5
6
7
8
9
10
Reserve balances with Reserve Banks 1
Total vault cash 2
Vault cash used to satisfy reserve requirements 3 .
Surplus vault cash 4
Total reserves 5
Required reserves
Excess reserve balances at Reserve Banks 6
Total borrowings at Reserve Banks
Seasonal borrowings at Reserve Banks
Extended credit at Reserve Banks 7
1984
1981
1982
1983
Dec.
Dec.
Aug.
Sept.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.P
26,163
19,538
15,755
3,783
41,918
41,606
312
642
53
149
24,804
20,392
17,049
3,343
41,853
41,353
500
697
33
187
21,965
20,035
16,695
3,340
38,660
38,214
446
1,573
198
490
20,585
20,798
17,331
3,467
37,916
37,418
498
1,441
191
515
21,059
20,471
17,078
3,393
38,137
37,632
505
837
142
255
20,943
20,558
17,201
3,357
38,144
37,615
529
912
119
6
20,986
20,755
17,908
2,847
38,894
38,333
561
745
%
2
21,325
22,578
18,795
3,782
40,120
39,507
613
715
86
4
18,414
22,269
17,951
4,318
36,365
35,423
942
567
103
5
19,484
20,396
16,791
3,604
36,275
35,568
707
952
133
27
Weekly and biweekly averages of daily figures for week ending 8
1984
11
12
13
14
15
16
17
18
19
20
Reserve balances with Reserve Banks 1
Total vault cash 2
Vault cash used to satisfy reserve requirements 3 .
Surplus vault cash 4
Total reserves 5
Required reserves
Excess reserve balances at Reserve Banks 6
Total borrowings at Reserve Banks
Seasonal borrowings at Reserve Banks
Extended credit at Reserve Banks 7
Jan. 11
Jan. 18
Jan. 25
Feb. 1
Feb. 15
Feb. 29
Mar. 14
Mar. 28
Apr. IIP
Apr. 25p
21,443
21,508
18,219
3,289
39,662
38,980
682
563
69
2
21,466
24,027
19,617
4,410
41,083
40,608
475
781
79
4
20,956
23,238
19,294
3,944
40,250
39,670
580
505
96
6
20,798
22,475
18,567
3,908
39,365
38,862
503
677
109
3
18,445
22,774
18,406
4,368
36,851
35,656
1,195
556
90
3
18,212
21,750
17,452
4,298
35,664
34,943
721
571
116
7
19,948
19,980
16,458
3,522
36,406
35,635
770
689
118
21
18,859
20,938
17,188
3,750
36,047
35,322
725
1,136
149
30
20,234
19,803
16,495
3,307
36,730
36,399
330
1,313
131
36
20,545
20,471
17,098
3,373
37,643
37,081
561
1,232
138
44
1. Excludes required clearing balances and adjustments to compensate for
float.
2. Dates refer to the maintenance periods in which the vault cash can be used to
satisfy reserve requirements. Under contemporaneous reserve requirements,
maintenance periods end 30 days after the lagged computation periods in which
the balances are held.
3. Equal to all vault cash held during the lagged computation period by
institutions having required reserve balances at Federal Reserve Banks plus the
amount of vault cash equal to required reserves during the maintenance period at
institutions having no required reserve balances.
4. Total vault cash at institutions having no required reserve balances less the
amount of vault cash equal to their required reserves during the maintenance
period.
5. Total reserves not adjusted for discontinuities consist of reserve balances
with Federal Reserve Banks, which exclude required clearing balances and
1.13
adjustments to compensate for float, plus vault cash used to satisfy reserve
requirements. Such vault cash consists of all vault cash held during the lagged
computation period by institutions having required reserve balances at Federal
Reserve Banks plus the amount of vault cash equal to required reserves during the
maintenance period at institutions having no required reserve balances.
6. Reserve balances with Federal Reserve Banks plus vault cash used to satisfy
reserve requirements less required reserves.
7. 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.
8. Biweekly averages beginning Feb. 15, 1984.
FEDERAL FUNDS A N D REPURCHASE AGREEMENTS
Large Member Banks 1
Averages of daily figures, in millions of dollars
1984 week ending Monday
By maturity and source
Mar. 5
Mar. 12
Mar. 19
Mar. 26
Apr. 2
Apr. 9
Apr. 16
Apr. 23
Apr. 30
One day and continuing contract
1 Commercial banks in United States
2 Other depository institutions, foreign banks and foreign
official institutions, and U.S. government agencies .
3 Nonbank securities dealers
4 All other
57,784
58,394'
54,980''
53,253
52,319
62,747
60,140
57,002
53,388
24,028
5,334
26,400
24,534
5,596
26,646
24,542
5,383
26,538
24,458
6,223
25,984'
22,624
6,841
26,592
23,784
6,334
27,527
23,007
6,022
24,903
21,030
5,984
24,413
20,604
6,124
25,817
All other maturities
5 Commercial banks in United States
6 Other depository institutions, foreign banks and foreign
official institutions, and U.S. government agencies .
7 Nonbank securities dealers
8 All other
7,236
7,787
7,732
7,454
7,516
7,810
8,463
8,991
8,271
9,476
8,097
9,080
10,010
8,021
9,169
10,710
8,035
8,991
10,614'
8,292'
9,303
10,832
7,240
9,104
10,727
6,667
8,780
11,421
7,366
11,634
11,324
8,845
12,086
11,588
8,608
9,132
24,918
6,230
24,067
5,371
23,013
5,293
23,285
4,404
22,142
5,315
24,229
5,490
23,674
5,116
23,439
5,109
21,454
5,415
MEMO: Federal funds and resale agreement loans in
maturities of one day or continuing contract
9 Commercial banks in United States
10 Nonbank securities dealers
1. Banks with assets of $1 billion or more as of Dec. 31, 1977.
A6
1.14
DomesticNonfinancialStatistics • May 1984
FEDERAL RESERVE BANK INTEREST RATES
Percent per annum
Current and previous levels
Extended credit 1
Short-term adjustment credit
and seasonal credit
Federal Reserve
Bank
First 60 days
of borrowing
Next 90 days
of borrowing
After 150 days
Effective date
for current rates
Rate on
4/30/84
Effective
date
Previous
rate
Rate on
4/30/84
Previous
rate
Rate on
4/30/84
Previous
rate
Rate on
4/30/84
Previous
rate
9
4/9/84
4/9/84
4/9/84
4/10/84
4/9/84
4/10/84
8l/2
9
%Vi
10
9 Vi
11
9 Vi
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San F r a n c i s c o . . .
9
4/9/84
4/9/84
4/9/84
4/13/84
4/9/84
4/13/84
8Vi
9
8l/2
10
9'/2
4/9/84
4/9/84
4/9/84
4/10/84
4/9/84
4/10/84
4/9/84
4/9/84
4/9/84
4/13/84
4/9/84
4/13/84
9l/2
11
Range of rates in recent years 2
Effective date
In effect Dec. 31, 1973
1974— Apr. 25
30
Dec. 9
16
1975— Jan.
6
10
24
Feb. 5
7
Mar. 10
14
May 16
23
1976— Jan.
19
23
Nov. 22
26
1977— Aug. 30
31
Sept. 2
Oct. 26
1978— Jan.
9
20
May 11
12
Range (or
level}—
All F.R.
Banks
F.R.
Bank
of
N.Y.
7'/2
71/2
8
8
73/4
73/4
V/1-8
8
73/4-8
73/4
71/4-73/4
7'/4-73/4
IV*
73/4
71/4
63/4
63/4
61/4—63/4
61/4
6-6V4
6
51/2-6
51/2
51/4—5 V2
51/4
5'/4-5 3 /4
51/4-53/4
53/4
6
6-6'/2
6V2
61/2-7
7
1978— July
3
10
Aug. 21
Sept. 22
Oct. 16
20
Nov. 1
3
71/4
6 3 /4-7'/4
6 3 /4
6'/4
Effective
6V*
6
6
1979—July 20
Aug. 17
20
Sept. 19
21
Oct. 8
10
7-7'/»
7 V*
73/4
8
8-81/2
8V2
8'/2-9'/2
9'/2
10
10-1C/2
W/2
10'/>-l1
11
11-12
12
F.R.
Bank
of
N.Y.
71/4
71/4
73/4
8
81^
Effective date
1981— May
Nov.
Dec.
5>/2
51/4
51/4
51/4
53/4
53/4
6
6l/2
6'/2
1
1980— Feb. 15
19
May 29
30
June 13
16
July 28
29
Sept. 26
Nov. 17
Dec. 5
8
9>/2
9>/2
10
1982—July
Aug.
10'/2
10'/>
11
11
Oct.
12
12
Nov.
12-13
13
12-13
13
13
13
Dec.
12
11-12
11
12
11
10-11
10
10
7
11
Range (or
level)—
All F.R.
Banks
5
8
2
6
4
13-14
14
13-14
13
12
20
23
2
3
16
27
30
12
13
22
26
14
15
17
U'/>-12
9
81/2-9
F.R.
Bank
of
N.Y.
14
14
13
13
12
8'/2
5'/!
1. Applicable to advances when exceptional circumstances or practices involve
only a particular depository institution and to advances when an institution is
under sustained liquidity pressures. See section 201.3(b)(2) of Regulation A.
2. Rates for short-term adjustment credit. For description and earlier data see
the following publications of the Board of Governors: Banking and Monetary
Statistics, 1914-1941, and 1941-1970; Annual Statistical Digest, 1970-1979, 1980,
1981, and 1982.
Range (or
level>—
All F.R.
Banks
1984— Apr.
lV/2
11-11 Vi
11
11 Vi
UVi
11
11
10'/!
10Vi
lO-lOVi
10
91^-10
9Vi
9 - 9 >/2
9
8'/2-9
8 >/2-9
10
10
9>/2
9>/2
9
9
9
8 </2
81/2
8>/2
11
10
U
12
12
12-13
13
13
13
In effect Apr. 30, 1984
In 1980 and 1981, the Federal Reserve applied a surcharge to short-term
adjustment credit borrowings by institutions with deposits of $500 million or more
that had borrowed in successive weeks or in more than 4 weeks in a calendar
quarter. A 3 percent surcharge was in effect from Mar. 17, 1980, through May 7,
1980. There was no surcharge until Nov. 17, 1980, when a 2 percent surcharge was
adopted; the surcharge was subsequently raised to 3 percent on Dec. 5, 1980, and
to 4 percent on May 5, 1981. The surcharge was reduced to 3 percent effective
Sept. 22, 1981, and to 2 percent effective Oct. 12. As of Oct. 1, the formula for
applying the surcharge was changed from a calendar quarter to a moving 13-week
period. The surcharge was eliminated on Nov. 17, 1981.
Policy Instruments
A7
1.15 RESERVE REQUIREMENTS OF DEPOSITORY INSTITUTIONS 1
Percent of deposits
Type of deposit, and
deposit interval
Member bank requirements
before implementation of the
Monetary Control Act
Type of deposit, and
deposit interval 5
Percent
Effective date
Net demand2
$0 million-$2 million
$2 million-$10 million
$10 million-$100 million
$100 million-$400 million
Over $400 million
7
9>/2
113/4
123/4
I6V4
Time and savings2'3
Savings
Time 4
$0 million-$5 million, by maturity
30-179 days
180 days to 4 years
4 years or more
Over $5 million, by maturity
30-179 days
180 days to 4 years
4 years or more
12/30/76
12/30/76
12/30/76
12/30/76
12/30/76
Net transaction accounts7,8
$0-$28.9 million
Over $28.9 million
Nonpersonal time deposits9
By original maturity
Less than l'/z years
1 '/2 years or more
3/16/67
Eurocurrency
All types
3
2 Vi
1
6
2Vi
1
liabilities
3/16/67
1/8/76
10/30/75
12/12/74
1/8/76
10/30/75
1. For changes in reserve requirements beginning 1963, see Board's Annual
Statistical Digest, 1971-1975, and for prior changes, see Board's Annual Report
for 1976, table 13. Under provisions of the Monetary Control Act, depository
institutions include commercial banks, mutual savings banks, savings and loan
associations, credit unions, agencies and branches of foreign banks, and Edge Act
corporations.
2. Requirement schedules are graduated, and each deposit interval applies to
that part of the deposits of each bank. Demand deposits subject to reserve
requirements were gross demand deposits minus cash items in process of
collection and demand balances due from domestic banks.
The Federal Reserve Act as amended through 1978 specified different ranges of
requirements for reserve city banks and for other banks. Reserve cities were
designated under a criterion adopted effective Nov. 9, 1972, by which a bank
having net demand deposits of more than $400 million was considered to have the
character of business of a reserve city bank. The presence of the head office of
such a bank constituted designation of that place as a reserve city. Cities in which
there were Federal Reserve Banks or branches were also reserve cities. Any
banks having net demand deposits of $400 million or less were considered to have
the character of business of banks outside of reserve cities and were permitted to
maintain reserves at ratios set for banks not in reserve cities.
Effective Aug. 24, 1978, the Regulation M reserve requirements on net balances
due from domestic banks to their foreign branches and on deposits that foreign
branches lend to U.S. residents were reduced to zero from 4 percent and 1 percent
respectively. The Regulation D reserve requirement of borrowings from unrelated
banks abroad was also reduced to zero from 4 percent.
Effective with the reserve computation period beginning Nov. 16, 1978,
domestic deposits of Edge corporations were subject to the same reserve
requirements as deposits of member banks.
3. Negotiable order of withdrawal (NOW) accounts and time deposits such as
Christmas and vacation club accounts were subject to the same requirements as
savings deposits.
The average reserve requirement on savings and other time deposits before
implementation of the Monetary Control Act had to be at least 3 percent, the
minimum specified by law.
4. Effective Nov. 2, 1978, a supplementary reserve requirement of 2 percent
was imposed on large time deposits of $100,000 or more, obligations of affiliates,
and ineligible acceptances. This supplementary requirement was eliminated with
the maintenance period beginning July 24, 1980.
Effective with the reserve maintenance period beginning Oct. 25, 1979, a
marginal reserve requirement of 8 percent was added to managed liabilities in
excess of a base amount. This marginal requirement was increased to 10 percent
beginning Apr. 3, 1980, was decreased to 5 percent beginning June 12, 1980, and
was eliminated beginning July 24, 1980. Managed liabilities are defined as large
time deposits, Eurodollar borrowings, repurchase agreements against U.S.
government and federal agency securities, federal funds borrowings from nonmember institutions, and certain other obligations. In general, the base for the
marginal reserve requirement was originally the greater of (a) $100 million or (b)
the average amount of the managed liabilities held by a member bank, Edge
corporation, or family of U.S. branches and agencies of a foreign bank for the two
reserve computation periods ending Sept. 26, 1979. For the computation period
beginning Mar. 20, 1980, the base was lowered by (a) 7 percent or (b) the decrease
in an institution's U.S. office gross loans to foreigners and gross balances due
from foreign offices of other institutions between the base period (Sept. 13-26,
1979) and the week ending Mar. 12, 1980, whichever was greater. For the
computation period beginning May 29, 1980, the base was increased by 7Vi
percent above the base used to calculate the marginal reserve in the statement
week of May 14-21, 1980. In addition, beginning Mar. 19, 1980, the base was
reduced to the extent that foreign loans and balances declined.
Depository institution requirements
after implementation of the
Monetary Control Act 6
5. The Garn-St Germain Depository Institutions Act of 1982 (Public Law 97320) provides that $2 million of reservable liabilities (transaction accounts,
nonpersonal time deposits, and Eurocurrency liabilities) of each depository
institution be subject to a zero percent reserve requirement. The Board is to adjust
the amount of reservable liabilities subject to this zero percent reserve requirement each year for the next succeeding calendar year by 80 percent of the
percentage increase in the total reservable liabilities of all depository institutions,
measured on an annual basis as of June 30. No corresponding adjustment is to be
made in the event of a decrease. Effective Dec. 9, 1982, the amount of the
exemption was established at $2.1 million. Effective with the reserve maintenance
period beginning Jan. 12, 1984, the amount of the exemption is $2.2 million. In
determining the reserve requirements of a depository institution, the exemption
shall apply in the following order: (1) nonpersonal money market deposit accounts
(MMDAs) authorized under 12 CFR section 1204.122; (2) net NOW accounts
(NOW accounts less allowable deductions); (3) net other transaction accounts;
and (4) nonpersonal time deposits or Eurocurrency liabilities starting with those
with the highest reserve ratio. With respect to NOW accounts and other
transaction accounts, the exemption applies only to such accounts that would be
subject to a 3 percent reserve requirement.
6. For nonmember banks and thrift institutions that were not members of the
Federal Reserve System on or after July 1, 1979, a phase-in period ends Sept. 3,
1987. For banks that were members on or after July 1, 1979, but withdrew on or
before Mar. 31, 1980, the phase-in period established by Public Law 97-320 ends
on Oct. 24, 1985. For existing member banks the phase-in period of about three
years was completed on Feb. 2, 1984. All new institutions will have a two-year
phase-in beginning with the date that they open for business, except for those
institutions that have total reservable liabilities of $50 million or more.
7. Transaction accounts include all deposits on which the account holder is
permitted to make withdrawals by negotiable or transferable instruments, payment orders of withdrawal, and telephone and preauthorized transfers (in excess
of three per month) for the purpose of making payments to third persons or others.
However, MMDAs and similar accounts offered by institutions not subject to the
rules of the Depository Institutions Deregulation Committee (DIDC) that permit
no more than six preauthorized, automatic, or other transfers per month of which
no more than three can be checks—are not transaction accounts (such accounts
are savings deposits subject to time deposit reserve requirements.)
8. The Monetary Control Act of 1980 requires that the amount of transaction
accounts against which the 3 percent reserve requirement applies be modified
annually by 80 percent of the percentage increase in transaction accounts held by
all depository institutions determined as of June 30 each year. Effective Dec. 31,
1981, the amount was increased accordingly from $25 million to $26 million; and
effective Dec. 30, 1982, to $26.3 million; and effective Dec. 29, 1983, to $28.9
million.
9. In general, nonpersonal time deposits are time deposits, including savings
deposits, that are not transaction accounts and in which a beneficial interest is
held by a depositor that is not a natural person. Also included are certain
transferable time deposits held by natural persons, and certain obligations issued
to depository institution offices located outside the United States. For details, see
section 204.2 of Regulation D.
NOTE. Required reserves must be held in the form of deposits with Federal
Reserve Banks or vault cash. Nonmembers may maintain reserve balances with a
Federal Reserve Bank indirectly on a pass-through basis with certain approved
institutions.
A8
DomesticNonfinancialStatistics • May 1984
1.16 MAXIMUM INTEREST RATES PAYABLE on Time and Savings Deposits at Federally Insured Institutions'
Percent per annum
Type of deposit
Commercial banks
Savings and loan associations and
mutual savings banks (thrift institutions) 1
In effect Apr. 30, 1984
In effect Apr. 30, 1984
Percent
1
2
3
4
Savings
Negotiable order of withdrawal accounts
Negotiable order of withdrawal accounts of $2,500 or more 2
Money market deposit account 2
Time accounts by maturity
5 7-31 days of less than $2,5004
6 7-31 days of $2,500 or more 2
7 More than 31 days
1. Effective Oct. 1, 1983, restrictions on the maximum rates of interest payable
by commercial banks and thrift institutions on various categories of deposits were
removed. For information regarding previous interest rate ceilings on all categories of accounts see earlier issues of the FEDERAL RESERVE BULLETIN, the
Federal Home Loan Bank Board Journal, and the Annual Report of the Federal
Deposit Insurance Corporation before November 1983.
2. Effective Dec. 1, 1983, IRA/Keogh (HR10) Plan accounts are not subject to
minimum deposit requirements.
3. Effective Dec. 14, 1982, depository institutions are authorized to offer a new
account with a required initial balance of $2,500 and an average maintenance
balance of $2,500 not subject to interest rate restrictions. No minimum maturity
5'/!
5'/4
5 >/2
Effective date
Percent
l
1/1/84
12/31/80
1/5/83
12/14/82
5 /i
1/1/84
1/5/83
10/1/83
5'/i
51/4
Effective date
7/1/79
12/31/80
1/5/83
12/14/82
9/1/82
1/5/83
10/1/83
period is required for this account, but depository institutions must reserve the
right to require seven days notice before withdrawals. When the average balance
is less than $2,500, the account is subject to the maximum ceiling rate of interest
for NOW accounts; compliance with the average balance requirement may be
determined over a period of one month. Depository institutions may not guarantee
a rate of interest for this account for a period longer than one month or condition
the payment of a rate on a requirement that the funds remain on deposit for longer
than one month.
4. Deposits of less than $2,500 issued to governmental units continue to be
subject to an interest rate ceiling of 8 percent.
Policy Instruments
1.17
A9
FEDERAL RESERVE OPEN MARKET TRANSACTIONS
Millions of dollars
1984
1983
Type of transaction
1981
1982
1983
Sept.
Nov.
Oct.
Jan.
Dec.
Mar.
Feb.
U . S . GOVERNMENT SECURITIES
Outright transactions (excluding matched
transactions)
1
2
3
4
Treasury bills
Gross purchases
Gross sales
Exchange
Redemptions
5
6
7
8
9
13,899
6,746
0
1,816
17,067
8,369
0
3,000
18,888
3,420
0
2,400
3,184
214
0
500
309
0
0
0
1,435
0
0
700
3,695
0
0
0
0
1,967
0
1,300
368
828
0
600
3,159
0
0
0
Others within 1 year
Gross purchases
Gross sales
Maturity shift
Exchange
Redemptions
317
23
13,794
-12,869
0
312
0
17,295
-14,164
0
484
0
18,887
-16,553
87
0
0
902
-753
0
0
0
529
-636
0
155
0
2,828
-2,930
0
0
0
915
0
0
0
0
573
1,530
0
0
0
-2,488
-4,574
0
0
0
1,012
0
0
10
11
12
13
1 to 5 years
Gross purchases
Gross sales
Maturity shift
Exchange
1,702
0
-10,299
10,117
1,797
0
-14,524
11,804
1,896
0
-15,533
11,641
0
0
-902
753
0
0
-256
636
820
0
-1,684
1,796
0
0
-915
0
0
0
-487
1,530
0
0
2,488
2,861
0
0
-1,012
0
14
15
16
17
5 to 10 years
Gross purchases
Gross sales
Maturity shift
Exchange
393
0
-3,495
1,500
388
0
-2,172
2,128
890
0
-2,450
2,950
0
0
0
0
0
0
-273
0
349
0
-250
700
0
0
0
0
0
300
-86
0
0
0
97
1,000
0
0
0
0
18
19
20
21
Over 10 years
Gross purchases
Gross sales
Maturity shift
Exchange
379
0
0
1,253
307
0
-601
234
383
0
-904
1,962
0
0
0
0
0
0
0
0
151
0
-894
434
0
0
0
0
0
0
0
0
0
0
-97
713
0
0
0
0
22
23
24
All maturities
Gross purchases
Gross sales
Redemptions
16,690
6,769
1,816
19,870
8,369
3,000
22,540
3,420
2,487
3,184
214
500
309
0
0
2,909
0
700
3,695
0
0
0
2,267
1,300
368
828
600
3,159
0
0
25
26
Matched transactions
Gross sales
Gross purchases
589,312
589,647
543,804
543,173
578,591
576,908
48,193
47,667
53,751
53,367
56,858
57,991
58,979
56,404
54,833
58,096
55,656
47,310
66,827
73,634
27
28
Repurchase agreements
Gross purchases
Gross sales
79,920
78,733
130,774
130,286
105,971
108,291
37,211
30,223
19,247
28,499
3,257
3,257
3,644
2,260
14,245
15,629
0
0
4,9%
4,9%
9,626
8,358
12,631
8,933
-9,326
3,342
2,504
-1,688
-9,407
9,966
494
0
108
0
0
189
0
0
292
0
0
5
0
0
6
0
0
84
0
0
2
0
0
40
0
0
38
0
0
10
13,320
13,576
18,957
18,638
8,833
9,213
2,871
2,510
1,960
2,510
497
497
634
426
931
1,139
0
0
609
609
130
130
-672
356
-557
-84
206
-248
-38
-10
36 Repurchase agreements, net
-582
1,285
-1,062
913
-1,122
0
418
-418
0
0
37 Total net change in System Open Market
Account
9,175
9,773
10,897
10,203
-11,005
3,258
3,128
-2,354
-9,444
9,956
29 Net change in U.S. government securities
FEDERAL AGENCY OBLIGATIONS
30
31
32
Outright transactions
Gross purchases
Gross sales
Redemptions
33
34
Repurchase agreements
Gross purchases
Gross sales
35 Net change in federal agency obligations
BANKERS ACCEPTANCES
NOTE: Sales, redemptions, and negative figures reduce holdings of the System
Open Market Account; all other figures increase such holdings. Details may not
add to totals because of rounding.
A10
DomesticNonfinancialStatistics • May 1984
1.18 FEDERAL RESERVE BANKS
Condition and Federal Reserve Note Statements
Millions of dollars
Account
Mar. 28
Wednesday
End of month
1984
1984
Apr. 11
Apr. 4
Apr. 18
Apr. 25
Feb.
Mar.
Apr.
Consolidated condition statement
ASSETS
11,114
4,618
515
11.111
4.618
514
11,109
4,618
514
11,109
4,618
503
11,109
4,618
488
11,116
4,618
534
11,111
4,618
520
11,109
4,618
482
718
0
588
0
2,425
0
671
0
6,334
0
1,020
0
896
0
907
0
1 Gold certificate account
2 Special drawing rights certificate account
3 Coin
Loans
4
To depository institutions
Other
5
Acceptances—Bought outright
6
Held under repurchase agreements
Federal agency obligations
Bought outright
7
8
Held under repurchase agreements
U.S. government securities
Bought outright
9
Bills
10
Notes
11
Bonds
12
Total bought outright 1
13 Held under repurchase agreements
14 Total U.S. government securities
0
0
0
0
349
0
0
305
8,558
0
8,558
0
8,556
0
8,556
0
8,556
325
8,568
0
8,558
0
8,556
426
61,222
62,921
21,527
145,670
0
145,670
66,579
62,921
21,527
151,027
0
151,027
66,524
62,921
21,527
150,972
0
150,972
69,478
64,127
21,804
155,409
0
155,409
68,886
64,127
21,804
154,817
3,514
158,331
56,399
62,921
21,527
140,847
0
140,847
66,366
62,921
21,527
150,814
0
150,814
69,111
64,127
21,804
155,042
7,092
162,134
15 Total loans and securities
154,946
160,173
161,953
164,636
173,895
150,435
160,268
172,328
8,181
549
10,236
549
8,139
549
9,484
549
8,356
548
11,193
549
7,698
549
7,044
548
3,942
4,585
4,013
4,461
4,015
4,580
4,017
4,777
4,020
5,088
3,915
3,879
4,011
4,553
3,912
5,286
188,450
195,675
195,477
199,693
208,122
186,239
193,328
205,327
153,617
154,844
156,122
156,068
155,680
152,383
153,871
155,388
17,766
3,838
187
506
19,873
4,701
200
457
22,891
2,827
217
421
21,277
7,677
183
336
23,818
14,045
251
319
16,330
3,226
247
498
22,167
3,684
221
562
19,715
16,729
345
324
22,297
25,231
26,356
29,473
38,433
20,301
26,634
37,113
6,941
2,301
9,902
2,340
7,376
2,330
8,481
2,312
8,002
2,660
8,000
2,099
6,911
2,427
6,435
2,920
185,156
192,317
192,184
196,334
204,775
182,783
189,843
201,856
1,498
1,465
331
1,501
1,465
392
1,514
1,465
314
1,516
1,465
378
1,518
1,465
364
1,482
1,465
509
1,499
1,465
521
1,520
1,465
486
188,450
195,675
195,477
199,693
208,122
186,239
193,328
205,327
117,565
114,928
115,738
114,051
114,193
119,391
113,547
116,173
16 Cash items in process of collection
17 Bank premises
Other assets
18 Denominated in foreign currencies 2
19 All other 3
20 Total assets
LIABILITIES
21 Federal Reserve notes
Deposits
22 To depository institutions
23
U.S. Treasury—General account
24
Foreign—Official accounts
25
Other
26 Total deposits
27 Deferred availability cash items
28 Other liabilities and accrued dividends 4
29 Total liabilities
CAPITAL ACCOUNTS
30 Capital paid in
31 Surplus
32 Other capital accounts
33 Total liabilities and capital accounts
34 MEMO: Marketable U.S. government securities held in
custody for foreign and international account
Federal Reserve note statement
LESS: Held by bank 5
Federal Reserve notes, net
Collateral held against notes net:
Gold certificate account
Special drawing rights certificate account
Other eligible assets
U.S. government and agency securities ..
42 Total collateral.
183,081
29,464
153,617
183,452
28,608
154,844
183,744
27,622
156,122
184,269
28,201
156,068
184,534
28,854
155,680
182,185
29,838
152,347
183,132
29,261
153,871
184,496
29,108
155,388
11,114
4,618
0
137,885
11,111
4,618
0
139,115
11,109
4,618
0
140,395
11,109
4,618
0
140,341
11,109
4,618
0
139,953
11,116
4,618
0
136,613
11,111
4,618
0
138,142
11,109
4,618
0
139,661
153,617
154,844
156,122
156,068
155,680
152,347
153,871
155,388
1. Includes securities loaned—fully guaranteed by U.S. government securities
pledged with Federal Reserve Banks—and excludes (if any) securities sold and
scheduled to be bought back under matched sale-purchase transactions.
2. Assets shown in this line are revalued monthly at market exchange rates.
3. Includes special investment account at Chicago of Treasury bills maturing
within 90 days.
4. Includes exchange-translation account reflecting the monthly revaluation at
market exchange rates of foreign-exchange commitments.
5. Beginning September 1980, Federal Reserve notes held by the Reserve Bank
are exempt from the collateral requirement.
Reserve
1.19 FEDERAL RESERVE BANKS
Banks;
Banking
Aggregates
All
Maturity Distribution of Loan and Security Holdings
Millions of dollars
Type and maturity groupings
Mar. 28
Wednesday
End of month
1984
1984
Apr. 4
Apr. 11
Apr. 18
Apr. 25
Feb. 29
Mar. 30
Apr. 30
1 Loans—Total
2
Within 15 days
16 days to 90 days
3
91 days to 1 year
4
718
678
40
0
588
519
69
0
2,425
2,351
74
0
670
634
36
0
6,334
6,312
22
0
1,020
941
79
0
896
864
32
0
907
864
43
0
5 Acceptances—Total
6
Within 15 days
16 days to 90 days
7
8
91 days to 1 year
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
349
349
0
0
0
0
0
0
0
0
0
0
305
305
0
0
9 U.S. government securities—Total
10 Within 15 days 1
11
16 days to 90 days
12 91 days to 1 year
13 Over 1 year to 5 years
14 Over 5 years to 10 years
15 Over 10 years
145,670
5,045
29,318
43,959
34,522
14,196
18,630
151,027
5,192
33,515
44,588
34,906
14,196
18,630
150,972
4,294
34,153
44,793
34,906
14,196
18,630
155,409
6,551
36,223
43,617
35,789
14,322
18,907
158,331
7,071
36,277
45,965
35,789
14,322
18,907
140,847
4,499
25,076
43,925
34,521
14,196
18,630
150,814
3,424
35,062
44,980
34,522
14,196
18,630
162,134
10,462
35,614
46,562
36,267
14,322
18,907
16 Federal agency obligations—Total.
17 Within 15 days 1
18
16 days to 90 days
19 91 days to 1 year
20
Over 1 year to 5 years
21
Over 5 years to 10 years
22
Over 10 years
8,558
188
763
1,668
4,176
1,360
403
8,558
37
881
1,701
4,176
1,360
403
8,556
256
666
1,680
4,191
1,360
403
8,556
351
571
1,680
4,191
1,360
403
8,881
460
617
1,675
4,409
1,321
399
8,568
162
688
1,587
4,378
1,350
403
8,558
188
763
1,668
4,176
1,360
403
8,982
561
635
1,657
4,409
1,321
399
1. Holdings under repurchase agreements are classified as maturing within 15 days in accordance with maximum maturity of the agreements.
A12
1.20
DomesticNonfinancialStatistics • May 1984
AGGREGATE RESERVES OF DEPOSITORY INSTITUTIONS A N D MONETARY B A S E
Billions of dollars, averages of daily figures
Item
1980
Dec.
1981
Dec.
1982
Dec.
1983
1983
Dec.
Sept.
Aug.
2
3
4
5
Nonborrowed reserves
Nonborrowed reserves plus extended credit 3
Required reserves
Monetary base 4
Nov.
Dec.
Jan.
Feb.
Mar.
Seasonally adjusted
ADJUSTED FOR
CHANGES IN RESERVE REQUIREMENTS'
1 Total reserves2
Oct.
1984
30.64
31.51
33.63
35.28
35.22
35.31
35.32
35.25
35.28
35.50
36.07
36.10
28.95
28.95
30.13
150.11
30.88
31.03
31.20
157.82
33.00
33.18
33.13
169.81
34.51
34.51
34.72
184.97
33.67
34.16
34.77
180.13
33.87
34.38
34.81
181.78
34.47
34.73
34.81
182.85
34.34
34.35
34.72
183.95
34.51
34.51
34.72
184.97
34.79
34.79
34.89
186.94
35.50
35.50
35.12
188.58
35.15
35.18
35.39
188.71
Not seasonally adjusted
6 Total reserves2
7
8
9
10
Nonborrowed reserves
Nonborrowed reserves plus extended credit 3
Required reserves
Monetary base 4
31.34
32.23
34.35
36.00
34.71
35.01
35.31
35.35
36.00
37.30
35.65
35.63
29.65
29.65
30.82
152.80
31.59
31.74
31.91
160.65
33.71
33.90
33.85
172.83
35.22
35.23
35.44
188.23
33.17
33.66
34.27
180.14
33.57
34.08
34.51
181.24
34.47
34.73
34.81
182.67
34.45
34.45
34.82
185.04
35.22
35.23
35.44
188.23
36.59
36.59
36.69
188.10
35.09
35.09
34.71
185.93
34.68
34.70
34.92
187.16
N O T ADJUSTED FOR
CHANGES IN RESERVE REQUIREMENTS 5
11 Total reserves2
12
13
14
15
Nonborrowed reserves
Nonborrowed reserves plus extended credit 3
Required reserves
Monetary base 4
40.66
41.93
41.85
38.89
38.66
37.92
38.14
38.14
38.89
40.12
36.37
36.28
38.97
38.97
40.15
163.00
41.29
41.44
41.61
170.47
41.22
41.41
41.35
180.52
38.12
38.12
38.33
192.36
37.11
37.61
38.21
185.40
36.48
36.99
37.42
185.11
37.29
37.55
37.63
186.60
37.24
37.25
37.62
188.97
38.12
38.12
38.33
192.36
39.41
39.41
39.41
192.30
35.80
35.80
35.42
186.67
35.32
35.33
35.58
187.81
1. Figures incorporate adjustments for discontinuities associated with the
implementation of the Monetary Control Act and other regulatory changes to
reserve requirements. To adjust for discontinuities due to changes in reserve
requirements on reservable nondeposit liabilities, the sum of such required
reserves is subtracted from the actual series. Similarly, in adjusting for discontinuities in the monetary base, required clearing balances and adjustments to
compensate for float also are subtracted from the actual series.
2. Total reserves not adjusted for discontinuities consist of reserve balances
with Federal Reserve Banks, which exclude required clearing balances and
adjustments to compensate for float, plus vault cash used to satisfy reserve
requirements. Such vault cash consists of all vault cash held during the lagged
computation period by institutions having required reserve balances at Federal
Reserve Banks plus the amount of vault cash equal to required reserves during the
maintenance period at institutions having no required reserve balances.
3. 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.
4. The monetary base not adjusted for discontinuities consists of total reserves
plus required clearing balances and adjustments to compensate for float at Federal
Reserve Banks and the currency component of the money stock less the amount
of vault cash holdings of thrift institutions that is included in the currency
component of the money stock plus, for institutions not having required reserve
balances, the excess of current vault cash over the amount applied to satisfy
current reserve requirements. After the introduction of contemporaneous reserve
requirements (CRR), currency and vault cash figures are measured over the
weekly computation period ending Monday.
Before CRR, all components of the monetary base other than excess reserves
are seasonally adjusted as a whole, rather than by component, and excess
reserves are added on a not seasonally adjusted basis. After CRR, the seasonally
adjusted series consists of seasonally adjusted total reserves, which include
excess reserves on a not seasonally adjusted basis, plus the seasonally adjusted
currency component of the money stock and the remaining items seasonally
adjusted as a whole.
5. Reflects actual reserve requirements, including those on nondeposit liabilities, with no adjustments to eliminate the effects of discontinuities associated
with implementation of the Monetary Control Act or other regulatory changes to
reserve requirements.
NOTE. Latest monthly and biweekly figures are available from the Board's
H.3(502) statistical release. Historical data and estimates of the impact on
required reserves of changes in reserve requirements are available from the
Banking Section, Division of Research and Statistics, Board of Governors of the
Federal Reserve System, Washington, D.C. 20551.
Monetary Aggregates
A13
1.21 MONEY STOCK, LIQUID ASSETS, AND DEBT MEASURES
Billions of dollars, averages of daily figures
1984
1983
1980
Dec.
1981
Dec.
1982
Dec.
1983
Dec.
Dec.
Jan.
Feb.
Mar.
Seasonally adjusted
414.9
1,632.6
1,989.8
2,326.0
3,946.9
441.9
1,796.6
2,236.7
2,598.4
4,323.8
480.5
1,965.3
2,460.3
2,868.7
4,710.1
525.3
2,196.1
2,706.7'
3,175.9'
5,219.0
525.3
2,196.1
2,706.7'
3,175.9'
5,219.0
530.0'
2,206.6'
2,721.5'
3,195.4
5,271.9
532.9
2,222.0
2,744.9'
n.a.
5,327.5
535.2
2,228.8
2,765.6
n.a.
n.a.
116.7
4.2
266.5
27.6
124.0
4.3
236.2
77.4
134.1
4.3
239.7
102.4
148.0
4.9
243.7
128.8
148.0
4.9
243.7
128.8
149.9
4.9
244.5
130.7
150.2
5.0
243.8
133.9
150.9
5.0
244.0
135.3
1,217.7
357.2
1,354.6
440.2
1,484.8
495.0
1,670.8
510.6'
1,670.8
510.6'
1,676.2'
514.9'
1,689.1
523.0'
1,693.5
535.4
Savings deposits 9
Commercial Banks
Thrift Institutions
185.9
215.6
159.7
186.1
164.9
197.2
134.6
178.2
134.6
178.2
132.1
177.7
130.1
176.4
128.9
176.5
14
15
Small denomination time deposits 9
Commerical Banks
Thrift Institutions
287.5
443.9
349.6
477.7
382.2
474.7
353.1
440.0
353.1
440.0
352.9
444.1
352.8
448.1'
353.5
449.7
16
17
Money market mutual funds
General purpose and broker/dealer
Institution-only
61.6
15.0
150.6
36.2
185.2
48.4
138.2
40.3
138.2
40.3
137.9
40.6
142.1'
41.6
144.8
41.8
18
19
Large denomination time deposits 10
Commercial Banks 11
Thrift Institutions
213.9
44.6
247.3
54.3
261.8
66.1
225.5
100.3
225.5
100.3
227.1'
106.1
228.3'
111.7
232.7
115.1
20
21
Debt components
Federal debt
Non-federal debt
742.8
3,204.1
830.1
3,493.7
991.4
3,718.7
1,177.9
4,041.0
1,177.9
4,041.0
1204.8
4067.1
1,221.5
4,106.0
n.a.
n.a.
1
2
3
4
5
Ml
M2
M3
L
Debt 2
6
7
8
9
Ml components
Currency 2
Travelers checks 3
Demand deposits 4
Other checkable deposits 5
10
11
Nontransactions components
In M26
In M3 only 7
12
13
Not seasonally adjusted
424.8
1,635.4
1,996.1
2,332.8
3,946.9
452.3
1,798.7
2,242.7
2,605.6
4,323.8
491.9
1,967.4
2,466.6
2,876.5
4,710.1
537.8
2,198.0
2,712.8'
3,183.7'
5,219.0
537.8
2,198.0
2,712.8''
3,183.7'
5,219.0
534.8
2,210.4'
2,727.4'
3,206.8
5,259.7'
521.9
2,211.9'
2,737.7'
n.a.
528.1
2,229.5
2,765.3
n.a.
n.a.
118.8
3.9
274.7
27.4
126.1
4.1
243.6
78.5
136.4
4.1
247.3
104.1
150.5
4.6
251.6
131.2
150.5
4.6
251.6
131.2
148.4
4.6
249.4
132.5
148.3
4.7
237.9
130.9
149.8
4.8
239.4
134.1
1,210.6
360.7
1,346.3
444.1
1,475.5
499.2
1,660.1
514.8'
1,660.1
514.8'
1,675.6'
517.(K
1,690.0'
525.8'
1,701.4
535.7
Money market deposit accounts
Commercial banks
Thrift institutions
n.a.
n.a.
n.a.
n.a.
26.3
16.6
230.1
146.0
230.1
146.0
234.2
146.3
238.3
147.9
242.6
150.2
35
36
Savings deposits 8
Commercial Banks
Thrift Institutions
183.8
214.4
157.5
184.7
162.1
195.5
132.0
176.5
132.0
176.5
131.3
176.1
129.9
175.2
130.2
176.8
37
38
Small denomination time deposits 9
Commercial Banks
Thrift Institutions
286.0
442.3
347.7
475.6
380.1
472.4
351.0
437.6
351.0
437.6
353.7
445.7
355.3
450.2'
356.1
451.4
39
40
Money market mutual funds
General purpose and broker/dealer
Institution-only
61.6
15.0
150.6
36.2
185.2
48.4
138.2
40.3
138.2
40.3
137.9
40.6
142.1'
41.6
144.8
41.8
41
42
Large denomination time deposits 10
Commercial Banks 11
Thrift Institutions
218.5
44.3
252.1
54.3
266.2
66.2
228.9
100.7
228.9
100.7
229.3'
105.6'
229.7'
110.9
233.0
113.8
43
44
Debt components
Federal debt
Non-federal debt
742.8
3,204.1
830.1
3,943.7
5)91.4
3,718.7
1,177.9
4,041.0
1,177.9
4,041.0
1,201.6'
4,058.1'
1,219.8
4,088.1
22
23
24
25
26
Ml
M2
M3
L
Debt 2
27
28
29
30
Ml components
Currency 2
Travelers checks 3
Demand deposits 4
Other checkable deposits 5
31
32
Nontransactions components
M26
M3 only 7
33
34
For notes see bottom of next page.
n.a.
n.a.
A14
1.22
DomesticNonfinancialStatistics • May 1984
BANK DEBITS AND DEPOSIT TURNOVER
Debits are shown in billions of dollars, turnover as ratio of debits to deposits. Monthly data are at annual rates.
1983
Sept.
Oct.
1984
Nov.
Dec.
Jan.
Feb.
Seasonally adjusted
DEBITS TO
2
Demand deposits
1 All insured banks
Major New York City banks
2
3 Other banks
4 ATS-NOW accounts 3
5 Savings deposits 4
80,858.7
33,891.9
46,966.9
743.4
672.7
90,914.4
37,932.9
52,981.6
1,036.2
721.4
108,646.4
47,336.9
61,309.5
1,394.9
735.7
110,700.7
46,903.7
63,796.9
1,495.9
712.7
118,407.2
52,639.9
65,767.3
1,392.8
643.7
114,466.6
49,715.8
64,750.8
1,447.4
674.9
115,381.5
48,255.7
67,125.8
1,499.6
661.4
120,954.6
51,952.5
69,002.2
1,345.1
620.8
126,749.9
55,776.7
70,973.1
1,491.1
708.3
285.8
1,105.1
186.2
14.0
4.1
324.2
1,287.6
211.1
14.5
4.5
376.8
1,512.0
238.5
15.5
5.3
384.7
1,508.8
248.6
15.9
5.3
409.6
1,703.8
254.7
14.9
4.9
398.3
1,645.6
251.8
15.5
5.1
395.7
1,541.4
257.9
15.9
5.0
414.2
1,650.9
264.9
13.8
4.7
434.7
1,747.7
273.3
15.0
5.5
DEPOSIT TURNOVER
6
7
8
9
10
Demand deposits 2
All insured banks
Major New York City banks
Other banks
ATS-NOW accounts 3
Savings deposits 4
Not seasonally adjusted
DEBITS TO
2
Demand deposits
11 All insured banks
12 Major New York City banks
13 Other banks
14 ATS-NOW accounts 3
15 MMDA 5
16 Savings deposits 4
81,197.9
34,032.0
47,165.9
737.6
0
672.9
91,031.9
38,001.0
53,030.9
1,027.1
0
720.0
108,459.5
47,238.2
61,221.3
1,387.5
567.4
736.4
111,741.3
48,276.1
63,465.2
1,388.3
641.4
688.9
114,191.9
49,910.9
64,280.9
1,373.2
700.3
672.9
110,963.9
47.508.1
63,455.8
1,327.2
639.1
635.3
122,558.3
52,418.5
70,139.7
1,465.4
745.8
647.1
123,567.2
52,895.2
70,672.0
1,601.5
793.4
672.5
114,721.3
50,724.8
63,996.5
1,389.5
682.1
649.9
286.1
1,114.2
186.2
14.0
0
4.1
325.0
1,295.7
211.5
14.3
0
4.5
376.1
1,510.0
238.1
15.4
2.8
5.3
387.2
1,574.5
246.1
15.0
2.9
5.2
391.1
1,595.5
246.6
14.6
3.2
5.1
381.7
1,553.4
244.0
14.0
2.8
4.8
407.0
1,613.6
261.1
15.1
3.3
4.9
412.3
1,581.5
265.4
16.2
3.4
5.2
402.7
1,618.7
252.4
14.3
2.9
5.1
DEPOSIT TURNOVER
17
18
19
20
21
22
Demand deposits 2
All insured banks
Major New York City banks
Other banks
ATS-NOW accounts 3
MMDA 5
Savings deposits 4
1. Annual averages of monthly figures.
2. Represents accounts of individuals, partnerships, and corporations and of
states and political subdivisions.
3. Accounts authorized for negotiable orders of withdrawal (NOW) and accounts authorized for automatic transfer to demand deposits (ATS). ATS data
availability starts with December 1978.
4. Excludes ATS and NOW accounts, MMDA and special club accounts, such
as Christmas and vacation clubs.
5. Money market deposit accounts.
NOTE. Historical data for demand deposits are available back to 1970 estimated
in part from the debits series for 233 SMSAs that were available through June
1977. Historical data for ATS-NOW and savings deposits are available back to
July 1977. Back data are available on request from the Banking Section, Division
of Research and Statistics, Board of Governors of the Federal Reserve System,
Washington, D.C. 20551.
NOTES TO TABLE 1.21
1. Composition of the money stock measures and debt is as follows:
Ml: (1) currency outside the Treasury, Federal Reserve Banks, and the vaults
of commercial banks; (2) travelers checks of nonbank issuers; (3) demand deposits
at all commercial banks other than those due to domestic banks, the U.S.
government, and foreign banks and official institutions less cash items in the
process of collection and Federal Reserve float; and (4) other checkable deposits
(OCD) 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. The currency and demand
deposit components exclude the estimated amount of vault cash and demand
deposits respectively held by thrift institutions to service their OCD liabilities.
M2: Ml plus overnight (and continuing contract) repurchase agreements (RPs)
issued by all commercial banks and overnight Eurodollars issued to U.S. residents
by foreign branches of U.S. banks worldwide, MMDAs, savings and smalldenomination time deposits (time deposits—including retail RPs—in amounts of
less than $100,000), and balances in both taxable and tax-exempt general purpose
and broker/dealer money market mutual funds. Excludes individual retirement
accounts (IRA) 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. Also subtracted is a consolidation adjustment
that represents the estimated amount of demand deposits and vault cash held by
thrift institutions to service their time and savings deposits.
M3: M2 plus large-denomination time deposits and term RP liabilities (in
amounts of $100,000 or more) issued by commercial banks and thrift institutions,
term Eurodollars held by U.S. residents at foreign branches of U.S. banks
worldwide and at all banking offices in the United Kingdom and Canada, and
balances in both taxable and tax-exempt, institution-only money market mutual
funds. Excludes amounts held by depository institutions, the U.S. government,
money market funds, and foreign banks and official institutions. Also subtracted is
a consolidation adjustment that represents the estimated amount of overnight RPs
and Eurodollars held by institution-only money market mutual funds.
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 mutual fund holdings of these assets.
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. The source of data on domestic
nonfinancial debt is the Federal Reserve Board's flow of funds accounts. Debt
data are on an end-of-month basis.
2. Currency outside the U.S. Treasury, Federal Reserve Banks, and vaults of
commercial banks. Excludes the estimated amount of vault cash held by thrift
institutions to service their OCD liabilities.
3. Outstanding amount of U.S. dollar-denominated travelers checks of nonbank issuers. Travelers checks issued by depository institutions are included in
demand deposits.
4. Demand deposits at commercial banks and foreign-related institutions other
than those due to domestic banks, the U.S. government, and foreign banks and
official institutions less cash items in the process of collection and Federal
Reserve float. Excludes the estimated amount of demand deposits held at
commercial banks by thrift institutions to service their OCD liabilities.
5. Consists of NOW and ATS balances at all depository institutions, credit
union share draft balances, and demand deposits at thrift institutions. Other
checkable deposits seasonally adjusted equals the difference between the seasonally adjusted sum of demand deposits plus OCD and seasonally adjusted demand
deposits. Included are all ceiling free "Super NOWs," authorized by the
Depository Institutions Deregulation committee to be offered beginning Jan. 5,
1983.
6. Sum of overnight RPs and overnight Eurodollars, money market fund
balances (general purpose and broker/dealer), MMDAs, and savings and small
time deposits, less the consolidation adjustment that represents the estimated
amount of demand deposits and vault cash held by thrift institutions to service
their time and savings deposits liabilities.
7. Sum of large time deposits, term RPs and term Eurodollars of U.S.
residents, 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.
8. Savings deposits exclude MMDAs.
9. Small-denomination time deposits—including retail RPs— are those issued
in amounts of less than $100,000. All individual retirement accounts (IRA) and
Keogh accounts at commercial banks and thrifts are subtracted from small time
deposits.
10. Large-denomination time deposits are those issued in amounts of $100,000
or more, excluding those booked at international banking facilities.
11. Large-denomination time deposits at commercial banks less those held by
money market mutual funds, depository institutions, and foreign banks and
official institutions.
NOTE: Latest monthly and weekly figures are available from the Board's H.6
(508) release. Historical data are available from the Banking Section, Division of
Research and Statistics, Board of Governors of the Federal Reserve System,
Washington, D.C. 20551.
Commercial Banks
1.23
LOANS AND SECURITIES
A15
All Commercial Banks'
Billions of dollars; averages of Wednesday figures
1981
1982
Dec. 2
Dec.
1984
1983
1981
1982
Dec. 2
Dec.
1983
1984
Category
Nov.
Dec.
Jan.
Feb.
7. U.S. Treasury securities
3 Other securities
4 Total loans and leases 3
5 Commercial and industrial
loans
6
Real estate loans
7
Loans to individuals
8
Security loans
9
Loans to nonbank financial
institutions
10 Agricultural loans
11 Lease financing receivables
12 All other loans
1,316.3
1,412.1
1,548.9
Dec.
Jan.
Feb.
Not seasonally adjusted
Seasonally adjusted
1 Total loans and securities3
Nov.
1,567.6
1,582.8
1,601.1
1,326.1
1,422.5
1,556.1
1,579.0
1,585.1
1,596.5
189.1
250.4
1,161.6
111.4
232.8
981.8
131.5
240.6
1,050.4
185.0
247.6
1,123.5
188.8
249.0
1,141.1
188.4
251.4
1,145.2
189.9
249.8
1,156.8
111.0
231.4
973.9
130.9
239.1
1,042.0
186.2
247.1
1,115.7
188.0
247.5
1,132.1
189.2
251.2
1,142.4
358.0
285.7
185.1
21.9
392.4
303.2
191.8
24.7
407.8
332.1
215.4
26.2
413.0
335.6
219.7
27.3
417.6
340.5
224.3
27.5
423.1
343.8
228.0
30.9
360.1
286.8
186.4
22.7
394.7
304.1
193.1
25.5
409.7
333.4
216.7
26.7
415.4
336.6
221.2
28.2
416.2
341.2
225.0
27.6
421.4
343.5
227.3
29.8
30.2
33.0
12.7
47.2
31.1
36.1
13.1
49.5
29.8
39.3
13.0
52.1
29.7
39.6
13.1
54.1
30.8
39.8
13.4
48.4
30.7
40.0
13.5
51.6
31.2
33.0
12.7
49.2
32.1
36.1
13.1
51.5
30.2
39.6
13.0
54.1
30.6
39.6
13.1
56.4
30.9
39.6
13.4
51.2
30.8
39.4
13.5
51.2
1,319.1
1,415.0
1,551.4
1,570.0
1,585.2
1,603.6
1,328.9
1,425.4
1,558.6
1,581.4
1,587.5
1,599.0
976.7
2.8
1,045.0
2.9
1,118.2
2.5
1,134.5
2.4
1,144.9
2.4
1,164.1
2.5
984.7
2.8
1,053.3
2.9
1,126.0
2.5
1,143.5
2.4
1,147.7
2.4
1,159.3
2.5
360.2
394.6
409.7
414.9
419.4
425.0
362.3
396.9
411.6
417.3
418.1
423.3
2.2
8.9
2.3
8.5
1.9
8.6
1.8
8.3
1.9
8.2
1.9
8.5
2.2
9.8
2.3
9.5
1.9
8.9
1.8
9.1
1.9
8.6
1.9
8.6
349.1
334.9
14.2
19.0
383.8
373.5
10.3
13.5
399.2
386.9
12.3
14.5
404.8
394.7
10.1
12.7
409.4
397.0
12.4
12.4
414.6
402.6
12.1
13.2
350.3
334.3
16.1
20.0
385.2
372.7
12.4
14.5
400.8
388.0
12.7
14.5
406.4
393.9
12.5
13.6
407.7
395.5
12.2
12.9
412.7
400.8
12.0
13.0
MEMO
13 Total loans and securities plus
loans sold3'4
14 Total loans plus loans sold3-4
15 Total loans sold to affiliates3'4
16 Commercial and industrial loans
plus loans sold4
17 Commercial and industrial
loans sold 4
18 Acceptances held
19 Other commercial and industrial loans
20
To U.S. addressees 5
21
To non-U.S. addressees
22 Loans to foreign banks
1. Includes domestically chartered banks; U.S. branches and agencies of
foreign banks, New York investment companies majority owned by foreign
banks, and Edge Act corporations owned by domestically chartered and foreign
banks.
2. Beginning December 1981, shifts of foreign loans and securities from U.S.
banking offices to international banking facilities (IBFs) reduced the levels of
several items. Seasonally adjusted data that include adjustments for the amounts
shitted from domestic offices to IBFs are available in the Board's G.7 (407)
statistical release (available from Publications Services, Board of Governors of
the Federal Reserve System, Washington, D.C. 20551).
3. Excludes loans to commercial banks in the United States.
4. Loans sold are those sold outright to a bank's own foreign branches,
nonconsolidated nonbank affiliates of the bank, the bank's holding company (if
not a bank), and nonconsolidated nonbank subsidiaries of the holding company.
5. United States includes the 50 states and the District of Columbia.
NOTE. Data are prorated averages of Wednesday estimates for domestically
chartered banks, based on weekly reports of a sample of domestically chartered
banks and quarterly reports of all domestically chartered banks. For foreignrelated institutions, data are averages of month-end estimates based on weekly
reports from large agencies and branches and quarterly reports from all agencies,
branches, investment companies, and Edge Act corporations engaged in banking.
A16
DomesticNonfinancialStatistics • May 1984
1.24 MAJOR NONDEPOSIT FUNDS OF COMMERCIAL BANKS 1
Monthly averages, billions of dollars
1981
1982
Dec.
Dec.
1983
1984
source
1
2
3
4
5
6
Total nondeposit funds
Seasonally adjusted 2
Not seasonally adjusted
Federal funds, RPs, and other
borrowings from nonbanks 5
Seasonally adjusted
Not seasonally adjusted
Net balances due to foreign-related
institutions, not seasonally
adjusted
Loans sold to affiliates, not
seasonally adjusted 4
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
96.3
98.1
82.9'
84.9
90.9
90.5
88.4
90.1
77.9'
78.6
83.2'
se.O'
85.0'
86.1
81.7'
82.8
96.2'
99.4
100.3'
102.4
98.2'
99.2
103.9^
105.4
107.0
108.5
111.8
113.5
127.7'"
129.7
146.0
145.6
140.9
142.6
134.2'
134.9
132.5'
135.3
133.9'
135.1
134.9'
136.0
140.7'
143.9
140.5'
142.7
139.3'
140.3
142.7'
144.2
140.8
142.3
-18.1
-47.7
-57.8
-55.2
-59.0'
-si.y
-51.5
-55.8
-47.0
-42.7
-43.6
-41.3
-36.6
2.8
2.9
2.8
2.7
2.7
2.6
2.6
2.6
2.5
2.4
2.4
2.5
2.8
-22.4
54.9
32.4
-39.6
72.2
32.6
-48.7
76.3
27.6
-49.2
75.8
26.6
-50.9
77.4
26.5
-45.3
73.6
28.3
-46.3
74.7
28.3
-48.5
76.4
27.9
-42.9
76.5
33.6
-39.7
75.2
35.5
-38.7
73.0
34.3
-37.5
71.9
34.5
-34.7
73.4
38.7
4.3
48.1
52.4
-8.1
54.7
46.6
-9.1
55.8
46.7
-6.0
53.9
47.9
-8.0
55.2
47.2
-6.6
53.5
47.0
-5.1
53.5
48.3
-7.3
55.4
48.0
-4.1
53.1
49.0
-3.0
53.6
50.6
-4.9
52.7
47.8
-3.9
50.6
46.7
-1.9
49.5
47.6
59.0
59.2
71.(K
71.2
84.7
82.7
81.4
81.5
77.3'
76.2
76.1'
77.0
78.1'
77.3
79.9r
79.1
83.3'
84.6
84.8'
85.1
85.5'
84.6
86.5
85.5
85.1
12.2
11.1
12.8'
10.8
11.3
12.5
13.0
13.2
21.7'
21.8
20.3'
16.4
16.7'
17.9
IS^
24.7
n.O'
7.5
13.1'
10.8
16.5'
19.6
20.6'
22.3
16.7
17.5
325.4
330.4
347.9'
354.6'
287.7
285.5
287.4
284.0
285.9'
281.5'
284.1'
284.4'
282.8'
284.7'
278.3'
280.3'
280.7'
283.0'
283.1'
288.1'
284.3'
287.1'
283.7'
284.9'
288.9
288.6
MEMO
7 Domestically chartered banks' net
positions with own foreign
branches, not seasonally
adjusted 5
8 Gross due from balances
9 Gross due to balances
10 Foreign-related institutions' net
positions with directly related
institutions, not seasonally
adjusted 6
11 Gross due from balances
12 Gross due to balances
Security RP borrowings
13 Seasonally adjusted'
14 Not seasonally adjusted
U.S. Treasury demand balances 8
15 Seasonally adjusted
16 Not seasonally adjusted
Time deposits, $100,000 or more 9
17 Seasonally adjusted
18 Not seasonally adjusted
1. Commercial banks are those in the 50 states and the District of Columbia
with national or state charters plus agencies and branches of foreign banks, New
York investment companies majority owned by foreign banks, and Edge Act
corporations owned by domestically chartered and foreign banks.
2. Includes seasonally adjusted federal funds, RPs, and other borrowings from
nonbanks and not seasonally adjusted net Eurodollars and loans to affiliates.
Includes averages of Wednesday data for domestically chartered banks and
averages of current and previous month-end data for foreign-related institutions.
3. Other borrowings are borrowings on any instrument, such as a promissory
note or due bill, given for the purpose of borrowing money for the banking
business. This includes borrowings from Federal Reserve Banks and from foreign
banks, term federal funds, overdrawn due from bank balances, loan RPs, and
participations in pooled loans. Includes averages of daily figures for member
banks and averages of current and previous month-end data for foreign-related
institutions.
4. Loans initially booked by the bank and later sold to affiliates that are still
held by affiliates. Averages of Wednesday data.
5. Averages of daily figures for member and nonmember banks.
6. Averages of daily data.
7. Based on daily average data reported by 122 large banks.
8. Includes U.S. Treasury demand deposits and Treasury tax-and-loan notes at
commercial banks. Averages of daily data.
9. Averages of Wednesday figures.
Banking
1.25
ASSETS AND LIABILITIES OF COMMERCIAL BANKING INSTITUTIONS
Institutions
A17
Last-Wednesday-of-Month Series
Billions of dollars except for number of banks
1983
1982
Dec.
Mar.
Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
DOMESTICALLY CHARTERED
COMMERCIAL BANKS 1
1
2
3
4
5
6
Loans and securities, excluding
interbank
Loans, excluding interbank
Commercial and industrial
Other
U.S. Treasury securities
Other securities
7
8
9
10
11
Cash assets, total
Currency and coin
Reserves with Federal Reserve Banks
Balances with depository institutions .
Cash items in process of collection . . .
12
Other assets 2
13
14
15
16
17
18
19
20
Borrowings
Other liabilities
Residual (assets less liabilities)
1,370.3
1,000.7
356.7
644.0
129.0
240.5
1,392.2
1,001.7
358.0
643.7
150.6
239.9
1,403.8
1,005.1
357.9
647.2
155.5
243.3
1,411.9
1,007.5
356.7
650.8
160.9
243.5
1,435.1
1,025.6
360.1
665.6
166.0
243.5
1,437.4
1,029.1
361.1
668.0
165.1
243.3
1,457.0
1,043.4
363.0
680.4
167.5
246.1
1,466.1
1,049.7
364.0
685.7
171.2
245.2
1,483.0
1,060.3
367.0
693.3
176.8
245.9
1,502.3
1,075.5
372.8
702.7
180.4
246.4
1,525.2
1,095.1
380.8
714.4
181.4
248.7
184.4
23.0
25.4
67.6
68.4
168.9
19.9
20.5
67.1
61.5
170.1
20.4
23.9
66.1
59.6
164.5
20.3
22.4
65.6
56.3
176.9
21.3
18.8
69.7
67.1
168.7
20.7
20.6
67.1
60.3
176.9
21.0
22.5
69.0
64.4
160.0
20.8
15.4
66.7
56.9
164.0
20.5
19.7
67.1
56.6
179.0
22.3
17.6
70.9
69.0
190.5
23.3
18.6
75.6
73.0
265.3
257.9
252.4
248.3
253.2
254.5
257.2
252.3
253.0
261.9
253.8
Total assets/total liabilities and capital . . .
1,820.0
1,818.9
1,826.3
1,824.8
1,865.2
1,860.6
1,891.0
1,878.4
1,900.0
1,943.9
1,969.5
Deposits
Demand
Savings
Time
1,361.8
363.9
296.4
701.5
1,374.2
333.4
419.2
621.6
1,368.0
329.2
426.9
611.9
1,370.8
324.5
440.2
606.1
1,402.7
344.4
445.3
613.1
1,396.5
334.2
447.5
614.8
1,420.1
344.7
449.0
626.4
1,408.1
328.1
448.8
631.2
1,419.5
331.3
451.5
636.8
1,459.2
358.1
458.3
642.8
1,482.6
371.0
460.7
650.8
215.1
109.2
133.8
211.3
103.5
130.0
224.0
102.3
132.0
214.1
104.7
135.1
221.2
104.3
137.0
217.5
105.5
141.0
217.2
107.6
146.1
217.8
107.1
145.4
226.8
106.5
147.2
219.7
112.6
152.4
216.3
117.9
152.8
10.7
14,787
9.6
14,819
17.8
14,823
2.7
14,817
19.3
14,826
19.3
14,785
14.8
14,795
20.8
14,804
22.5
14,800
2.8
14,799
8.8
14,796
1,429.7
1,054.8
395.3
659.5
132.8
242.1
1,451.3
1,054.5
395.9
658.6
155.3
241.5
1,460.8
1,055.7
393.5
662.2
160.2
244.9
1,467.6
1,056.4
391.7
664.7
166.1
245.2
1,491.5
1,075.2
395.3
679.9
171.3
245.1
1,494.1
1,078.8
397.7
681.2
170.3
245.0
1,515.4
1,094.9
400.6
694.3
172.7
247.8
1,525.4
1,102.5
402.7
699.8
176.1
246.9
1,541.8
1,112.2
405.3
706.8
182.0
247.7
1,563.2
1,129.2
412.0
717.2
185.9
248.1
1,586.8
1,149.3
420.1
729.2
186.9
250.6
200.7
23.0
26.8
81.4
69.4
185.5
19.9
22.0
81.0
62.6
186.3
20.4
25.4
79.8
60.7
180.3
20.3
23.8
78.9
57.3
193.5
21.3
20.0
84.0
68.2
185.2
20.7
21.9
81.2
61.4
193.3
21.1
24.0
82.8
65.4
174.7
20.9
16.6
79.3
58.0
178.4
20.5
20.8
79.5
57.6
195.0
22.3
19.1
83.6
70.0
205.0
23.4
19.7
88.0
74.0
MEMO
21
22
U.S. Treasury note balances included in
borrowing
Number of banks
A L L COMMERCIAL BANKING
INSTITUTIONS 3
24
25
26
27
28
Loans and securities, excluding
interbank
Loans, excluding interbank
Commercial and industrial
Other
U.S. Treasury securities
Other securities
29
30
31
32
33
Cash assets, total
Currency and coin
Reserves with Federal Reserve Banks
Balances with depository institutions .
Cash items in process of collection . . .
34
Other assets 2
341.7
325.4
317.8
309.5
318.1
318.7
324.6
320.9
318.8
329.7
321.3
35
Total assets/total liabilities and capital .. .
1,972.1
1,962.2
1,964.9
1,957.4
2,003.2
1,998.0
2,033.3
2,021.0
2,039.1
2,088.0
2,113.1
36
37
38
39
Deposits
Demand
Savings
Time
1,409.7
376.2
296.7
736.7
1,419.5
345.7
419.7
654.1
1,411.0
341.1
427.3
642.6
1,413.1
336.4
440.7
636.0
1,443.8
356.4
445.7
641.6
1,438.1
346.4
448.0
643.8
1,461.4
356.6
449.5
655.3
1,448.9
340.0
449.3
659.5
1,459.0
343.2
452.0
663.8
1,499.4
369.9
458.8
670.6
1,524.8
383.2
461.3
680.4
40
41
42
Borrowings
Other liabilities
Residual (assets less liabilities)
278.3
148.4
135.7
269.9
141.1
131.9
281.3
138.6
133.9
269.5
137.9
137.0
278.2
142.3
138.9
277.9
139.1
142.9
280.5
143.4
148.0
282.6
142.3
147.3
289.6
141.5
149.1
282.5
151.9
154.2
275.1
158.6
154.7
10.7
15,329
9.6
15,376
17.8
15,390
2.7
15,385
19.3
15,396
19.3
15,359
14.8
15,370
20.8
15,382
22.5
15,383
2.8
15,382
8.8
15,380
23
MEMO
43
44
U.S. Treasury note balances included in
borrowing
Number of banks
1. Domestically chartered commercial banks include all commercial banks in
the United States except branches of foreign banks; included are member and
nonmember banks, stock savings banks, and nondeposit trust companies.
2. Other assets include loans to U.S. commercial banks.
3. Commercial banking institutions include domestically chartered commercial
banks, branches and agencies of foreign banks, Edge Act and Agreement
corporations, and New York State foreign investment corporations.
NOTE. Figures are partly estimated. They include all bank-premises subsidiaries and other significant majority-owned domestic subsidiaries. Data for domestically chartered commercial banks are for the last Wednesday of the month. Data
for other banking institutions are estimates made on the last Wednesday of the
month based on a weekly reporting sample of foreign-related institutions and
quarter-end condition report data.
A18
DomesticNonfinancialStatistics • May 1984
1.26 ALL LARGE WEEKLY REPORTING COMMERCIAL BANKS with Domestic Assets of $1.4 Billion or More
December 31, 1982, Assets and Liabilities
Millions of dollars, Wednesday figures
1984
Account
Feb. 29r
1 Cash and balances due from depository
institutions
2 Total loans, leases and securities, net
Securities
3 U.S. Treasury and govt, agency
4 Trading account
.•>
Investment account, by maturity
6
One year or less
7
Over one through five years
8
Over five years
9 Other securities
10 Trading account
11 Investment account
12
States & political subdivisions, by maturity
13
One year or less
14
Over one year
IS
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
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
Loans and leases
Federal funds sold1
To commercial banks
To nonbank brokers and dealers in securities
To others
Other loans and leases, gross
Other loans, gross
Commercial and industrial
Bankers' acceptances and commercial paper . . . .
All other
U.S. addressees
Non-U.S. addressees
Real estate loans
To individuals for personal expenditures
To depository and financial institutions
Commercial banks in the U.S
Banks in foreign countries
Nonbank depository and other financial institutions.
For purchasing and carrying securities
To finance agricultural production
To states and political subdivisions
To foreign governments and official institutions . . . .
All other
Lease financing receivables
LESS: Unearned income
Loan and lease reserve
Other loans and leases, net
All other assets
Total assets
Deposits
Demand deposits
Individuals, partnerships, and corporations
States and political subdivisions
U.S. government
Depository institutions in U.S
Banks in foreign countries
Foreign governments and official institutions
Certified and officers' checks
Transaction balances other than demand deposits
(ATS, NOW, Super NOW, telephone transfers)..
Nontransaction balances
Individuals, partnerships and corporations
States & political subdivisions
U.S. government
Depository institutions in U.S
Foreign governments, official institutions and banks ..
Liabilities for borrowed money
Borrowings from federal reserve banks
Treasury tax-and-loan notes
All other liabilities for borrowed money 2
Other liabilities and subordinated note and debentures
65 Total liabilities
66 Residual (total assets minus total liabilities)3
Mar. 7
Mar. 14
Mar. 21
Mar. 28
Apr. 4
Apr. 11
Apr. 18
86,720
82,577
96,141
86,207
83,347
90,760
87,341
90,982
91,294
742,750
737,465
739,549
736,817
737,184
746,871
745,896
751,455
751,095
80,186
10,952
69,234
18,139
38,705
12,389
49,137
3,214
45,923
41,808
5,085
36,723
4,115
1,853
79,773
10,581
69,192
18,267
38,330
12,595
49,454
3,672
45,782
41,726
4,882
36,844
4,055
2,070
80,226
11,015
69,212
18,378
38,093
12,741
49,738
3,884
45,854
41,787
4,879
36,908
4,067
2,016
79,025
10,774
68,250
18,254
37,316
12,681
49,235
3,636
45,599
41,538
4,843
36,694
4,061
1,957
78,682
10,452
68,230
18,549
36,999
12,682
49,429
3,916
45,514
41,357
4,794
36,564
4,156
1,983
79,190
11,173
68,016
18,383
36,994
12,639
48,779
3,952
44,827
40,769
4,648
36,120
4,058
2,217
79,267
11,534
67,733
18,221
36,871
12,642
48,439
3,590
44,849
40,757
4,656
36,101
4,092
2,088
79,894
12,278
67,616
18,064
36,718
12,834
49,767
5,490
44,277
40,180
4,909
35,270
4,097
2,636
78,649
11,431
67,217
18,251
36,119
12,847
49,988
5,707
44,281
40,138
4,856
35,282
4,143
2,491
46,880
31,653
9,409
5,818
579,456
567,970
226,943
3,517
223,426
216,531
6,894
145,450
93,454
40,718
8,616
7,316
24,785
15,712
7,361
21,107
4,499
12,727
11,486
5,197
9,566
564,694
137,954
42,419
29,169
8,139
5,111
578,594
567,091
228,546
3,928
224,618
217,890
6,728
145,800
93,371
40,178
8,369
6,800
25,009
13,602
7,397
20,993
4,526
12,676
11,503
5,182
9,662
563,749
138,999
43,828
30,611
8,345
4,872
578,585
567,090
228,339
3,415
224,924
218,165
6,759
146,608
93,539
39,024
7,915
6,523
24,585
14,410
7,438
21,111
4,579
12,042
11,495
5,199
9,645
563,740
131,862
39,701
26,880
8,269
4,552
581,713
570,218
231,031
3,656
227,375
220,678
6,697
146,790
93,630
39,586
7,786
6,854
24,946
13,033
7,462
21,298
4,771
12,618
11,495
5,204
9,610
566,899
131,964
40,871
26,939
9,095
4,837
581,026
569,579
231,104
3,575
227,530
220,780
6,750
146,784
94,028
38,991
7,650
7,019
24,322
12,680
7,403
21,429
4,675
12,484
11,447
5,253
9,556
566,218
137,644
45,683
31,751
9,166
4,766
585,642
574,171
232,463
3,487
228,976
222,100
6,876
147,436
94,382
40,049
7,927
6,991
25,131
12,959
7,460
21,612
4,536
13,273
11,471
5,221
9,419
571,002
143,404
45,961
32,632
8,481
4,847
584,830
573,372
232,352
3,288
229,064
222,432
6.632
147,776
94,625
39,900
8,148
6,790
24,962
12,609
7,396
21,640
4,411
12,662
11,457
5,223
9,466
570,141
142,436
41,631
28,454
8,536
4,641
592,111
580,650
234,419
3,330
231,089
224,485
6,604
148,227
95,143
41,000
8,475
6,962
25,563
13,848
7,455
22,322
4,470
13,765
11,461
5,105
9,480
577,527
138,708
41,733
28,373
8,634
4,725
592,922
581,446
234,707
3,224
231,484
225,064
6,420
148,510
95,899
40,451
8,614
6,961
24,875
14,360
7,477
22,479
4,481
13,082
11,475
5,139
9,547
578,235
135,392
967,424
959,041
967,552
954,988
958,175
981,035
975,673
981,145
977,781
185,654
140,432
5,447
2,446
22,624
6,376
969
7,360
174,470
134,167
4,347
2,043
19,961
5,866
818
7,268
180,302
138,701
4,389
2,445
20,166
6,076
786
7,739
171,550
131,648
4,650
1,105
20,318
5,698
868
7,262
176,086
134,156
4,250
1,736
21,285
6,292
734
7,633
187,445
140,978
4,609
3,624
22,640
5,723
802
9,068
183,475
140,631
5,017
2,504
20,436
5,875
881
8,132
184,830
140,530
4,940
3,911
20,898
5,982
814
7,755
178,982
137,178
4,742
2,854
19,213
5,877
837
8,282
32,787
411,094
382,522
18,247
406
7,145
2,774
181,504
486
16,207
164,811
90,980
33,688
412,712
384,066
18,317
395
7,039
2,894
182,608
30
10,157
172,421
90,119
33,395
412,978
384,077
18,259
402
7,314
2,926
182,131
1,825
6,902
173,404
93,193
33,224
413,308
384,384
18,353
395
7,302
2,874
178,863
178
13,032
165,654
92,858
32,899
415,351
386,014
18,698
390
7,387
2,862
175,644
20
10,636
164,988
93,066
35,426
415,594
386,854
18,072
390
7,436
2,842
178,914
60
3,390
175,464
97,452
35,353
415,886
386,760
18,212
396
7,342
3,175
180,546
1,992
2,579
175,975
93,893
35,857
414,329
385,109
18,204
404
7,196
3,415
182,806
40
10,573
172,192
97,240
33,180
413,224
383,907
18,482
393
7,004
3,439
188,438
4,931
16,641
166,865
98,008
902,018
893,598
901,999
889,803
893,046
914,831
909,153
915,062
911,833
65,406
65,443
65,554
65,186
65,129
66,204
66,519
66,083
65,948
1. Includes securities purchased under agreements to resell.
2. Includes federal funds purchased and securities sold under agreements to
repurchase; for information on these liabilities at banks with assets of $1 billion or
more on Dec. 31, 1977, see table 1.13.
3. This is not a measure of equity capital for use in capital adequacy analysis or
for other analytic uses,
1.27 LARGE WEEKLY REPORTING COMMERCIAL BANKS with Domestic Assets of $1 Billion or More on
December 31, 1977, Assets and LiabilitiesA
ASeries Discontinued.
Apr. 25
Weekly Reporting Banks
1.28
A19
LARGE WEEKLY REPORTING COMMERCIAL BANKS IN NEW YORK CITY Assets and Liabilities
Millions of dollars, Wednesday figures
1984
Account
1 Cash and balances due from depository institutions
2 Total loans, leases and securities, net 1
Securities
5
6
7
8
Feb. 29
Mar. 7
Mar. 14
Mar. 21
Mar. 28
Apr. 4
Apr. 11
Apr. 18
Apr. 25
19,057
156,706
19,047
25,111
154,979
19,240
154,310
19,473
153,271
21,505
158,749
21,259
152,599
154,360
20,578
155,934
23,503
158,034
10,868
1,885
7,796
1,186
10,953
1,897
7,696
1,359
10,734
1,894
7,486
1,355
10,353
1,863
7,142
1,348
10,467
2,260
6,858
1,350
10,616
2,007
7,266
1,344
10,410
1,960
7,106
1,344
10,370
1,954
7,049
1,367
10,231
2,032
6,838
1,362
9,543
8,718
1,292
7,425
826
9,584
8,776
1,293
7,483
808
9,636
8,818
1,272
7,546
818
9,634
8,812
1,278
7,534
822
9,702
8,777
1,278
7,498
925
9,306
8,498
1,095
7,402
808
9,407
8,581
1,106
7,474
827
9,814
8,978
1,535
7,443
836
9,798
8,952
1,534
7,418
846
12,902
6,206
4,208
2,489
127,684
125,665
59,544
876
58,668
57,124
1,544
21,065
13,337
12,746
1,524
2,897
8,325
8,045
621
6,148
735
3,424
2,019
1,441
2,849
123,393
61,843
237,607
10,542
4,082
3,632
2,828
125,836
123,817
59,540
938
58,602
57,262
1,340
21,126
13,385
12,342
1,505
2,533
8,304
6,492
608
6,118
760
3,446
2,018
1,433
2,883
121,520
64,044
235,690
12,842
6,092
3,880
2,870
126,115
124,0%
59,560
738
58,822
57,529
1,293
21,339
13,328
11,593
1,209
2,332
8,052
7,416
627
6,160
757
3,315
2,019
1,461
2,888
121,766
59,397
239,487
11,540
4,875
4,116
2,548
127,0%
125,078
60,818
792
60,027
58,796
1,230
21,361
13,322
12,324
1,478
2,515
8,331
6,139
614
6,237
825
3,437
2,018
1,462
2,852
122,782
60,579
234,129
11,455
4,345
4,441
2,669
125,943
123,920
60,614
846
59,768
58,498
1,270
21,381
13,357
11,693
1,122
2,585
7,985
5,873
569
6,321
783
3,329
2,023
1,478
2,818
121,647
61,517
234,262
14,872
7,036
5,182
2,654
128,285
126,275
61,308
790
60,518
59,149
1,369
21,439
14,236
11,902
1,268
2,449
8,185
6,273
571
6,319
605
3,622
2,010
1,499
2,832
123,954
64,986
245,240
11,707
5,378
4,061
2,267
127,175
125,166
61,180
743
60,437
59,223
1,214
21,443
14,255
11,479
1,230
2,282
7,968
5,979
563
6,302
456
3,508
2,010
1,509
2,832
122,835
66,199
241,818
10,240
4,038
4,084
2,118
129,852
127,837
61,979
699
61,281
60,131
1,149
21,478
14,253
12,054
1,420
2,276
8,358
6,822
544
6,421
452
3,833
2,015
1,502
2,840
125,510
66,714
243,227
12,163
6,118
4,004
2,040
130,242
128,226
61,609
702
60,907
59,809
1,098
21,608
14,486
12,024
1,598
2,436
7,990
7,537
542
6,529
437
3,454
2,016
1,529
2,871
125,842
62,795
244,332
48,254
32,850
764
632
5,362
5,048
800
2,796
43,749
30,723
536
425
3,813
4,539
599
3,114
45,891
31,359
642
626
4,378
4,616
591
3,679
42,742
29,164
618
250
4,530
4,360
693
3,127
45,908
30,906
514
437
4,961
4,991
553
3,546
47,749
31,734
627
940
5,150
4,391
594
4,312
45,104
30,361
604
691
4,421
4,532
580
3,914
46,330
31,553
667
1,107
4,779
4,521
623
3,080
47,009
32,132
636
635
4,261
4,552
652
4,139
3,651
71,268
65,526
2,194
18
2,482
1,048
57,207
3,698
71,591
65,721
2,208
18
2,504
1,141
60,612
3,709
71,421
65,469
2,15326
2,668
1,106
58,320
3,677
72,160
66,194
2,155
28
2,663
1,119
55,463
4,004
72,122
66,191
2,020
28
2,754
1,129
60,374
2,470
58,142
34,846
3,366
54,954
36,786
2,789
52,674
36,051
822
59,552
39,441
4,056
72,019
65,810
2,013
29
2,600
1,566
62,572
1,525
699
60,348
36,420
4,214
71,963
65,411
2,150
29
2,605
1,767
60,351
3,984
53,223
36,074
3,6%
71,744
65,852
2,140
26
2,632
1,095
61,395
735
1,791
58,869
35,4%
3,116
57,235
38,843
3,823
71,363
64,826
2,222
28
2,495
1,791
60,587
2,675
4,284
53,628
40,147
216,455
214,496
218,222
212,978
213,260
223,690
220,172
221,701
222,928
21,153
21,194
21,265
21,151
21,002
21,550
21,647
21,525
21,404
Investment account, by maturity
Over one through five years
Over five years
11
1?
13
14
15
17
18
19
70
71
??
73
74
?5
76
77
78
7,9
30
31
37
33
34
35
36
37
38
39
40
41
47
43
44
Investment account
States and political subdivisions, by maturity
One year or less
Over one year
Other bonds, corporate stocks and securities
Loans and leases
Federal funds sold3
To commercial banks
To nonbank brokers and dealers in securities
To others
Other loans and leases, gross
Other loans, gross
Commercial and industrial
Bankers' acceptances and commercial paper
All other
U.S. addressees
Non-U.S. addressees
Real estate loans
To individuals for personal expenditures
To depository and financial institutions
Commercial banks in the United States
Banks in foreign countries
Nonbank depository and other financial institutions.
For purchasing and carrying securities
To finance agricultural production
To states and political subdivisions
To foreign governments and official institutions
All other
Lease financing receivables
LESS: Unearned income
Loan and lease reserve
Other loans and leases, net
All other assets 4
Total assets
Deposits
45 Demand deposits
46
Individuals, partnerships, and corporations
47
States and political subdivisions
48
U.S. government
49 Depository institutions in the United States
50 Banks in foreign countries
51 Foreign governments and official institutions
52 Certified and officers' checks
53 Transaction balances other than demand deposits
ATS, NOW, Super NOW, telephone transfers) ..
54 Nontransaction balances
55
Individuals, partnerships and corporations
56 States and political subdivisions
57
U.S. Government
58 Depository institutions in United States
59 Foreign governments, official institutions and banks . .
60 Liabilities for borrowed money
67 Treasury tax-and-loan notes
63 All other liabilities for borrowed money 5
64 Other liabilities and subordinated note and debentures..
65 Total liabilities
66 Residual (total assets minus total liabilities)6
1.
2.
3.
4.
Excludes trading account securities.
Not available due to confidentiality.
Includes securities purchased under agreements to resell.
Includes trading account securities.
5. Includes federal funds purchased and securities sold under agreements to
repurchase.
6. Not a measure of equity capital for use in capital adequacy analysis or for
other analytic uses.
A20
DomesticNonfinancialStatistics • May 1984
1.29 LARGE WEEKLY REPORTING COMMERCIAL BANKS
Balance Sheet Memoranda
Millions of dollars, Wednesday figures
1984
Account
Feb. 29
Mar. 7
Mar. 14
Mar. 21
Mar. 28
Apr. 4
Apr. 11
Apr. 18
Apr. 25
BANKS WITH ASSETS OF $ 1 . 4 BILLION OR MORE
1
2
3
4
5
6
7
Total loans and leases (gross) and investments adjusted 1
Total loans and leases (gross) adjusted 1
Time deposits in amounts of $100,000 or more
Loans sold outright to affiliates—total 2
Commercial and industrial
Other
Nontransaction savings deposits (including M M D A ) . . . .
717,243'
586,067'
142,041'
2,538
1,912
626
153,399'
714,772
583,474
143,218
2,546
1,951
595
153,696
715,866
583,886
142,937
2,490
1,929
561
153,913
716,966
586,748
142,647
3,010
1,917
1,093
154,353
717,404
587,309
143,392
3,066
1,932
1,134
155,393
721,833
591,647
142,417
3,102
1,884
1,218
156,861
719,804
590,010
141,964
3,095
1,886
1,209
157,635
729,110
596,813
141,242
3,092
1,887
1,205
156,294
728,795
597,667
141,228
3,220
1,999
1,220
154,781
153,268
132,857
28,717
151,327
130,790
29,483
152,026
131,655
29,448
152,271
132,283
29,182
152,100
131,931
29,186
154,776
134,854
29,315
152,092
132,274
28,604
154,818
134,634
28,588
154,718
134,688
28,798
BANKS IN N E W YORK CITY
8 Total loans and leases (gross) and investments adjusted1,3 ..
9 Total loans and leases (gross) adjusted 1
10 Time deposits in amounts of $100,000 or more
1. Exclusive of loans and federal funds transactions with domestic commercial
banks.
2. Loans sold are those sold outright to a bank's own foreign branches,
1.30
nonconsolidated nonbank affiliates of the bank, the bank's holding company (if
not a bank), and nonconsolidated nonbank subsidiaries of the holding company.
3. Excludes trading account securities.
LARGE WEEKLY REPORTING U.S. BRANCHES AND AGENCIES OF FOREIGN BANKS WITH ASSETS OF
$1.4 BILLION OR MORE ON JUNE 30, 1980 Assets and Liabilities
Millions of dollars, Wednesday figures
1984
Account
Feb. 29
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
Cash and due from depository institutions.
Total loans and securities
U.S. Treasury and govt, agency securities 1
Other securities 1
Federal funds sold2
To commercial banks in the United States
To others
Other loans, gross
Commercial and industrial
Bankers acceptances and commercial
paper
All other
U.S. addressees
Non-U.S. addressees
To financial institutions
Commercial banks in the United States .
Banks in foreign countries
Nonbank financial institutions
To foreign govts, and official institutions3 ..
For purchasing and carrying securities ..
All other 3
Other assets (claims on nonrelated
parties)
Net due from related institutions
Total assets
Deposits or credit balances due to
other than directly related
institutions
Credit balances
Demand deposits
Individuals, partnerships, and
corporations
Other
Time and savings deposits
Individuals, partnerships, and
corporations
Other
Borrowings from other than directly
related institutions
Federal funds purchased 4
From commercial banks in the
United States
From others
Other liabilities for borrowed m o n e y . . . .
To commercial banks in the
United States
To others
Other liabilities to nonrelated parties
Net due to related institutions
Total liabilities
Mar. 7
Mar. 14
Mar. 21
Mar. 28
Apr. 4
Apr. 11
Apr. 18
Apr. 25
6,662
44,619
4,666
741
3,933
3,488
445
35,278
20,212
6,062
43,580
4,663
760
2,209
1,773
436
35,948
20,333
6,416
44,778
4,658
762
3,573
3,220
353
35,786
20,206
6,119
45,197
4,631
755
3,486
3,097
388
36,325
20,174
6,841
46,895
4,376
772
4,581
4,296
286
37,167
20,163
6,782
44,903
4,663
777
2,344
2,024
320
37,118
20,752
7,087
45,342
4,501
756
3,760
3,502
259
36,325
19,617
6,770
44,888
4,480
789
3,111
2,778
333
36,509
19,851
6,938
45,492
4,480
791
4,340
4,048
292
35,881
19,730
2,966
17,245
15,488
1,757
10,069
7,791
1,592
685
744
924
3,330
3,067
17,266
15,518
1,748
10,841
8,575
1,700
565
770
791
3,214
3,045
17,161
15,417
1,744
10,902
8,764
1,607
531
808
782
3,087
2,944
17,229
15,379
1,850
11,534
9,439
1,511
584
783
785
3,049
3,024
17,139
15,315
1,824
13,282
11,156
1,520
607
792
840
2,089
2,837
17,915
16,057
1,858
12,984
10,943
1,391
650
836
595
1,950
3,017
16,600
14,769
1,831
13,070
10,982
1,380
709
819
841
1,978
3,122
16,728
15,000
1,728
13,114
10,970
1,421
722
799
793
1,953
3,101
16,629
14,877
1,752
12,606
10,483
1,364
759
782
780
1,984
13,863
8,713
73,856
13,856
9,867
73,364
14,090
9,654
74,938
14,031
8,946
74,294
14,029
8,319
76,084
13,701
9,424
74,810
13,960
9,591
75,981
14,447
9,902
76,008
14,427
9,347
76,205
19,678
192
1,779
19,938
136
1,685
20,388
186
1,957
20,116
175
1,682
20,752
138
1,916
20,518
204
1,894
20,170
168
1,841
20,012
147
1,920
19,838
166
1,726
896
883
17,707
784
900
18,116
854
1,102
18,245
854
828
18,259
850
1,067
18,697
926
968
18,420
826
1,014
18,161
826
1,094
17,945
773
952
17,946
15,165
2,541
15,392
2,724
15,358
2,886
15,414
2,84(3
15,797
2,900
15,478
2,942
15,135
3,026
14,817
3,128
14,854
3,092
31,792
10,848
32,395
10,773
32,781
10,674
31,778
9,807
31,464
8,356
32,630
10,309
33,070
10,223
33,487
9,541
33,268
10,113
9,159
1,689
20,943
8,274
2,499
21,623
7,798
2,875
22,107
6,721
3,086
21,971
5,589
2,767
23,109
7,412
2,897
22,321
7,609
2,614
22,847
6,491
3,050
23,946
6,999
3,114
23,155
17,712
3,231
14,581
7,806
73,856
18,491
3,132
14,560
6,472
73,364
18,962
3,145
14,764
7,006
74,938
18,802
3,170
14,612
7,788
74,294
19,954
3,154
14,644
9,224
76,084
19,414
2,906
14,169
7,494
74,810
19,836
3,010
14,740
8,001
75,981
20,801
3,145
15,062
7,446
76,008
19,932
3,224
15,119
7,980
76,205
33,339
27,932
33,232
27,810
32,794
27,375
32,660
27,274
31,444
26,297
31,936
26,496
30,859
25,602
31,140
25,871
30,961
25,690
MEMO
42 Total loans (gross) and securities adjusted 5
43 Total loans (gross) adjusted 5
1. Prior to Jan. 4, 1984 U.S. Government Agency securities were included in
other securities.
2. Includes securities purchased under agreements to resell.
3. As of Jan. 4, 1984 loans to foreign governments and official institutions is
reported as a separate item. Before that date it was included in all other loans.
4. Includes securities sold under agreements to repurchase.
5. Exclusive of loans to and federal funds sold to commercial banks in the
United States.
IPC Demand Deposits
A21
1.31 GROSS DEMAND DEPOSITS of Individuals, Partnerships, and Corporations'
Billions of dollars, estimated daily-average balances
Commercial banks
Type of holder
1978
Dec.
19792
Dec.
1980
Dec.
1982
1981
Dec.
Dec/
1984
1983
Mar/
Sept.
June'
Dec.
Mar.
1 All holders—Individuals, partnerships, and
corporations
294.6
302.2
31S.5
288.9
291.7
272.0
281.9
280.3
293.7
279.3
2
3
4
5
6
27.8
152.7
97.4
2.7
14.1
27.1
157.7
99.2
3.1
15.1
29.8
162.8
102.4
3.3
17.2
28.0
154.8
86.6
2.9
16.7
35.4
150.5
85.9
3.0
17.0
32.7
139.9
79.4
3.1
16.9
34.6
146.9
80.3
3.0
17.2
32.1
150.2
77.9
2.9
17.1
32.8
161.3
78.5
3.3
17.8
31.7
150.3
78.1
3.3
15.9
Financial business
Nonfinancial business
Consumer
Foreign
Other
Weekly reporting banks
1978
Dec.
19794
Dec.
1980
Dec.
1981
Dec.
1982
Dec/
7 All holders—Individuals, partnerships, and
corporations
8
9
10
11
12
Financial business
Nonfinancial business
Consumer
Foreign
Other
Mar/
June'
Sept.
Dec.
Mar.
147.0
139.3
147.4
137.5
144.2
133.0
139.6
136.3
146.2
139.2
19.8
79.0
38.2
2.5
7.5
20.1
74.1
34.3
3.0
7.8
21.8
78.3
35.6
3.1
8.6
21.0
75.2
30.4
2.8
8.0
26.7
74.3
31.9
2.9
8.4
24.3
68.9
28.7
3.0
8.1
26.2
72.8
28.5
2.8
9.3
23.6
72.9
28.1
2.8
8.9
24.2
79.8
29.7
3.1
9.3
23.5
76.4
28.4
3.2
7.7
1. Figures include cash items in process of collection. Estimates of gross
deposits are based on reports supplied by a sample of commercial banks. Types of
depositors in each category are described in the June 1971 BULLETIN, p. 466.
2. Beginning with the March 1979 survey, the demand deposit ownership
survey sample was reduced to 232 banks from 349 banks, and the estimation
procedure was modified slightly. To aid in comparing estimates based on the old
and new reporting sample, the following estimates in billions of dollars for
December 1978 have been constructed using the new smaller sample; financial
business, 27.0; nonfinancial business, 146.9; consumer, 98.3; foreign, 2.8; and
other, 15.1.
1984
1983
3. After the end of 1978 the large weekly reporting bank panel was changed to
170 large commercial banks, each of which had total assets in domestic offices
exceeding $750 million as of Dec. 31, 1977. See "Announcements," p. 408 in the
May 1978 BULLETIN. Beginning in March 1979, demand deposit ownership
estimates for these large banks are constructed quarterly on the basis of 97 sample
banks and are not comparable with earlier data. The following estimates in billions
of dollars for December 1978 have been constructed for the new large-bank panel;
financial business, 18.2; nonfinancial business, 67.2; consumer, 32.8; foreign, 2.5;
other, 6.8.
A22
DomesticNonfinancialStatistics • May 1984
1.32 COMMERCIAL PAPER AND BANKERS DOLLAR ACCEPTANCES OUTSTANDING
Millions of dollars, end of period
1983
1978
Dec.
Instrument
1979'
Dec.
1980
Dec.
1981
Dec.
1982
Dec. 2
Oct.
Nov.
1984
Dec.
Jan.
Feb.
Mar.
Commercial paper (seasonally adjusted unless noted otherwise)
1 AU issuers
2
3
4
5
6
Financial companies 3
Dealer-placed paper4
Total
Bank-related (not seasonally
adjusted)
Direcdy placed paper5
Total
Bank-related (not seasonally
adjusted)
Nonfinancial companies 6
83,438
112,803
124,374
165,829'
166,67(K
175,150'
180,606'
185,852'
184,4^
190,808'
200,631
12,181
17,359
19,599
30,333'
34,634'
38,660'
41,459'
41,688'
39,884'
41,363'
43,167
3,521
2,784
3,561
6,045
2,516
2,195
2,341
2,441
2,087
1,765
1,767
51,647
64,757
67,854
81,66c
84,130'
91,737'
93,878'
96,548'
98,495'
102,606'
107,421
12,314
19,610
17,598
30,687
22,382
36,921
26,914
53,836
32,034
47,906'
34,622
44,753'
35,001
45,269'
35,566
47,616'
37,636'
46,04C
36,958'
46,839'
39,617
50,043
Bankers dollar acceptances (not seasonally adjusted)
7 Total
Holder
Accepting banks
Own bills
Bills bought
Federal Reserve Banks
Own account
Foreign correspondents
Others
Basis
14 Imports into United States
15 Exports from United States
16 All other
8
9
10
11
12
13
33,700
45,321
54,744
69,226
79,543
72,902
77,919
78,309
73,450
74,367
73,221
8,579
7,653
927
9,865
8,327
1,538
10,564
8,963
1,601
10,857
9,743
1,115
10,910
9,471
1,439
9,501
8,212
1,289
10,894
9,558
1,337
9,355
8,125
1,230
9,546
7,814
1,732
9,237
7,897
1,340
8,734
7,040
1,694
587
664
24,456
704
1,382
33,370
776
1,791
41,614
195
1,442
56,731
1,480
949
66,204
0
483
62,917
0
573
66,452
418
729
68,225
0
729
63,174
0
777
64,353
0
896
63,592
8,574
7,586
17,541
10,270
9,640
25,411
11,776
12,712
30,257
14,765
15,400
39,060
17,683
16,328
45,531
14,829
16,036
42,036
14,906
17,209
45,806
15,649
16,880
45,781
15,028
16,159
42,262
15,495
15,818
43,055
15,107
15,572
42,542
1. A change in reporting instructions results in offsetting shifts in the dealerplaced and directly placed financial company paper in October 1979.
2. Effective Dec. 1,1982, there was a break in the commercial paper series. The
key changes in the content of the data involved additions to the reporting panel,
the exclusion of broker or dealer placed borrowings under any master note
agreements from the reported data, and the reclassification of a large portion of
bank-related paper from dealer-placed to directly placed.
3. Institutions engaged primarily in activities such as, but not limited to,
commercial, savings, and mortgage banking; sales, personal, and mortgage
1.33
financing; factoring, finance leasing, and other business lending; insurance
underwriting; and other investment activities.
4. Includes all financial company paper sold by dealers in the open market.
5. As reported by financial companies that place their paper directly with
investors.
6. Includes public utilities and firms engaged primarily in such activities as
communications, construction, manufacturing, mining, wholesale and retail trade,
transportation, and services.
PRIME RATE CHARGED BY BANKS on Short-Term Business Loans
Percent per annum
Effective Date
Rate
16.00
15.75
1982—Oct. 14
Nov. 22
12.00
11.50
17.00
16.50
16.00
15.50
15.00
14.50
14.00
13.50
13.00
1983—Jan. 11
Feb. 28
Aug. 8
11.00
1984—Mar. 19
Apr. 5
11.50
12.00
10.50
11.00
Average
rate
1982—Jan
Feb
June
July
Aug
Sept
Oct
Nov
Dec
1983—Jan
15.75
16.56
16.50
16.50
16.50
16.50
16.26
14.39
13.50
12.52
11.85
11.50
11.16
1983—Feb.
Mar.
Apr.
May
June
July
Aug.
Sept,
Oct.
Nov.
Dec.
1984—Jan.
Feb.
Mar.
Apr.
Business
1.34
Lending
A23
TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, February 6-10, 1984
Size of loan (in thousands of dollars)
Item
All
sizes
1-24
25-49
50-99
1 000
100-499
500-999
and over
SHORT-TERM COMMERCIAL AND INDUSTRIAL LOANS
1
2
3
4
5
6
7
8
9
10
11
12
13
Amount of loans (thousands of dollars)
Number of loans
Weighted-average maturity (months)
With fixed rates
With floating rates
Weighted-average interest rate (percent per annum)..
Interquartile range1
With fixed rates
With floating rates
Percentage of amount of loans
With floating rate
Made under commitment
With no stated maturity
With one-day maturity
38,330,316
171,352
1.1
.7
2.2
11.06
10.45-11.24
10.93
11.35
991,513
125,356
4.6
4.0
6.1
14.13
13.24-14.93
14.44
13.53
549,652
16,856
4.2
3.8
4.9
13.45
12.55-14.20
13.70
13.13
709,274
10,749
3.5
2.0
5.1
13.33
12.13-14.54
13.89
12.76
2,247,241
12,402
4.2
2.5
5.2
12.66
11.57-13.80
13.03
12.49
972,939
1,483
3.1
1.5
4.1
11.99
11.46-12.68
11.45
12.20
32,859,696
4,507
.7
.5
1.3
10.75
10.40-10.89
10.68
10.91
32.6
63.7
10.4
40.3
33.9
33.8
11.6
.1
44.7
37.8
12.5
.1
49.6
44.5
27.4
.2
69.3
58.7
22.7
.6
72.4
69.8
35.4
2.2
28.3
65.6
8.4
46.9
1-99
LONG-TERM COMMERCIAL AND INDUSTRIAL LOANS
14
15
16
17
18
19
20
21
22
Amount of loans (thousands of dollars)
Number of loans
Weighted-average maturity (months)
With fixed rates
With floating rates
Weighted-average interest rate (percent per annum) . .
Interquartile range1
With fixed rates
With floating rates
23
24
Percentage of amount of loans
With floating rate
Made under commitment
3,705,613
29,580
48.0
48.5
47.9
11.92
10.86-12.69
12.33
11.78
473,173
26,742
40.4
36.5
43.7
14.21
13.00-14.93
15.24
13.31
351,506
1,980
39.6
37.0
40.9
12.13
11.46-13.10
11.29
12.53
206,780
309
42.2
38.2
43.2
12.18
11.57-12.96
12.15
12.18
2,674,153
548
50.9
57.0
49.5
11.46
10.65-12.28
11.33
11.49
76.0
73.9
53.5
31.1
68.1
69.3
80.5
81.1
80.7
81.5
1-24
CONSTRUCTION AND LAND DEVELOPMENT LOANS
25
26
27
28
29
30
31
32
33
Amount of loans (thousands of dollars)
Number of loans
Weighted-average maturity (months)
With fixed rates
With floating rates
Weighted-average interest rate (percent per annum) ..
Interquartile range1
With fixed rates
With floating rates
34
35
36
37
38
Percentage of amount of loans
With floating rate
Secured by real estate
Made under commitment
With no stated maturity
With one-day maturity
39
40
41
Type of construction
1- to 4-family
Multifamily
Nonresidential
LOANS TO FARMERS
Amount of loans (thousands of dollars)
43 Number of loans
Weighted-average maturity (months)
Weighted-average interest rate (percent per annum) ..
Interquartile range 1
42
44
45
46
By purpose of loan
47 Feeder livestock
Other livestock
Other current operating expenses
Farm machinery and equipment
Other
48
49
50
51
500 and over
50-99
2,278,565
43,012
8.9
4.3
13.5
13.34
12.00-14.20
14.13
12.60
189,847
23,372
5.3
5.4
5.1
14.03
13.27-14.45
14.12
13.79
358,574
10,406
9.9
7.6
12.0
13.38
12.37-14.50
13.75
13.05
249,161
3,977
5.8
5.0
7.5
13.80
12.92-14.76
14.29
12.73
909,700
4,978
11.2
3.2
20.1
13.77
12.00-14.21
15.05
12.42
571,282
279
7.2
2.2
9.3
12.22
11.57-12.69
11.74
12.41
51.3
91.3
61.6
49.9
6.0
26.7
80.8
36.7
47.9
10.6
53.6
99.5
76.5
44.0
.5
31.5
96.2
65.2
51.9
18.8
48.5
97.8
46.1
73.4
4.3
71.3
77.1
83.8
15.9
5.3
44.1
41.6
2.7
.0
55.5
1.5
.0
29.4
1.5
.0
22.3
2.8
.0
78.8
2.2
.0
2.3
.0
All sizes
10-24
1-9
25-49
50-99
158,661
42,006
8.6
14.12
13.50-14.75
161,008
11,116
9.5
14.22
13.66-14.76
194,352
5,719
8.9
14.12
13.51-14.93
199,351
3,212
8.6
13.90
13.24-14.38
12.68
13.62
13.81
13.86
13.47
14.29
13.92
14.09
14.05
14.42
14.24
14.06
14.19
14.04
14.56
13.61
13.86
14.15
14.42
14.05
(2)
250 and over
100-249
1,352,194
64,008
8.5
13.50
12.63-14.45
1. Interest rate range that covers the middle 50 percent of the total dollar
amount of loans made.
2. Fewer than 10 sample loans.
25-49
216,433
1,516
10.6
14.00
13.08-14.45
422,389
438
6.7
12.27
11.53-12.75
13.74
13.71
13.91
14.05
11.96
13.04
11.94
14.13
12.69
(2)
(2)
(2)
(2)
NOTE. For more detail, see the Board's E.2 (111) statistical release,
(2)
A24
1.35
DomesticNonfinancialStatistics • May 1984
I N T E R E S T R A T E S M o n e y and Capital M a r k e t s
Averages, percent per annum; weekly and monthly figures are averages of business day data unless otherwise noted.
1984
Instrument
1981
1982
1984, week ending
1983
Jan.
Feb.
Mar.
Apr.
Mar. 30
Apr. 6
Apr. 13
Apr. 20
Apr. 27
MONEY MARKET RATES
1 Federal funds 1 ' 2
2 Discount window borrowing1-2-3
Commercial paper 4 - 5
3
1-month
4
3-month
5
6-month
Finance paper, directly placed 4 - 5
6
1-month
7
3-month
6-month
8
Bankers acceptances 5 - 6
9
3-month
10 6-month
Certificates of deposit, secondary market 7
11
1-month
12 3-month
13 6-month
14 Eurodollar deposits, 3-month 8
U.S. Treasury bills5
Secondary market 9
15
3-month
16
6-month
17
1-year
Auction average 10
18
3-monVh
19
6-month
16.38
13.42
12.26
11.02
9.09
8.50
9.56
8.50
9.59
8.50
9.91
8.50
10.29
8.87
9.97
8.50
10.41
8.50
10.13
8.71
10.37
9.00
9.98
9.00
15.69
15.32
14.76
11.83
11.89
11.89
8.87
8.88
8.89
9.23
9.20
9.18
9.35
9.32
9.31
9.81
9.83
9.86
10.17
10.18
10.22
10.04
10.09
10.11
10.16
10.15
10.17
10.11
10.12
10.13
10.23
10.22
10.26
10.16
10.21
10.27
15.30
14.08
13.73
11.64
11.23
11.20
8.80
8.70
8.69
9.20
9.08
9.02
9.34
9.14
9.06
9.76
9.54
9.38
10.08
9.86
9.76
9.95
9.74
9.60
10.16
9.81
9.66
10.08
9.87
9.72
10.04
9.83
9.80
10.00
9.92
9.86
15.32
14.66
11.89
11.83
8.90
8.91
9.23
9.19
9.38
9.35
9.88
9.91
10.22
10.26
10.12
10.15
10.20
10.22
10.15
10.15
10.26
10.33
10.26
10.34
15.91
15.91
15.77
16.79
12.04
12.27
12.57
13.12
8.96
9.07
9.27
9.56
9.33
9.42
9.56
9.78
9.43
9.54
9.73
9.91
9.91
10.08
10.37
10.40
10.24
10.41
10.73
10.83
10.18
10.34
10.59
10.61
10.26
10.40
10.69
10.79
10.19
10.33
10.61
10.73
10.28
10.42
10.76
10.89
10.24
10.46
10.84
10.89
14.03
13.80
13.14
10.61
11.07
11.07
8.61
8.73
8.80
8.90
9.02
9.07
9.09
9.18
9.20
9.52
9.66
9.67
9.69
9.84
9.95
9.72
9.85
9.86
9.74
9.91
9.%
9.65
9.79
9.82
9.76
9.86
9.98
9.64
9.79
10.00
14.029
13.776
13.159
10.686
11.084
11.099
8.63
8.75
8.86
8.93
9.06
9.04
9.03
9.13
9.24
9.44
9.58
9.68
9.69
9.83
9.86
9.76
9.88
9.67
9.83
9.66
9.82
9.80
9.92
9.86
9.64
9.74
14.78
14.56
12.27
12.80
9.57
10.21
9.90
10.64
10.04
10.79
10.59
11.31
10.90
11.69
10.79
11.54
10.76
11.55
12.92
13.01
13.06
13.00
12.92
12.76
10.45
10.80
11.02
11.10
11.34
11.18
10.93
11.37
11.58
11.68
11.82
11.75
11.05
11.54
11.75
11.84
12.00
11.95
11.59
12.02
12.25
12.32
12.45
12.38
11.98
12.37
12.56
12.63
12.65
12.65
11.80
12.20
12.39
12.46
12.51
12.47
11.84
12.24
12.41
12.49
12.52
12.50
10.94
11.69
11.85
11.99
12.38
12.58
12.66
12.73
12.70
10.98
11.79
14.44
14.24
14.06
13.91
13.72
13.44
10.91
11.67
11.80
11.%
12.36
12.54
12.61
12.54
12.60
12.08
12.47
12.66
12.74
12.78
12.76
12.87
12.23
10.84
11.29
11.44
11.90
12.17
12.00
12.13
12.05
12.21
12.27
10.43
11.76
11.33
10.88
12.48
11.66
8.80
10.17
9.51
9.00
10.10
9.63
9.04
9.94
9.64
9.41
10.22
9.94
9.54
10.30
9.96
9.40
10.25
9.93
9.50
10.30
10.04
9.60
10.30
9.97
9.50
10.30
9.89
9.55
10.30
9.94
15.06
14.17
14.75
15.29
16.04
14.94
13.79
14.41
15.43
16.11
12.78
12.04
12.42
13.10
13.55
12.92
12.20
12.71
13.13
13.65
12.88
12.08
12.70
13.11
13.59
13.33
12.57
13.22
13.54
13.99
13.59
12.81
13.48
13.77
14.31
13.48
12.71
13.33
13.70
14.15
13.53
12.74
13.42
13.74
14.21
13.51
12.71
13.36
13.73
14.22
13.60
12.79
13.48
13.75
14.37
13.70
12.95
13.62
13.84
14.41
16.63
15.49
12.73
12.99
13.05
13.63
13.%
13.80
13.86
13.87
14.05
14.18
12.36
5.20
12.53
5.81
11.02
4.40
11.35
4.27
11.16
4.59
11.39
4.63
11.66
4.64
11.52
4.57
11.79
4.63
11.63
4.70
11.62
4.62
11.60
4.61
CAPITAL MARKET RATES
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
U.S. Treasury notes and bonds 11
Constant maturities 12
1-year
2-year
2-w-year 13 .
3-year
5-year
7-year
10-year
20-year
30-year
Composite 14
Over 10 years (long-term)
State and local notes
and bonds
Moody's series 15
Aaa
Baa
Bond Buyer series 16
Corporate bonds
Seasoned issues 17
AH industries
Aaa
Aa
A
Baa
A-rated, recently-offered utility
bond 18
MEMO: Dividend/price ratio 19
40
Preferred stocks
41
Common stocks
1. Weekly and monthly figures are averages of all calendar days, where the
rate for a weekend or holiday is taken to be the rate prevailing on the preceding
business day. The daily rate is the average of the rates on a given day weighted by
the volume of transactions at these rates.
2. Weekly figures are averages for statement week ending Wednesday.
3. Rate for the Federal Reserve Bank of New York.
4. Unweighted average of offering rates quoted by at least five dealers (in the
case of commercial paper), or finance companies (in the case of finance paper).
Before November 1979, maturities for data shown are 30-59 days, 90-119 days,
and 120-179 days for commercial paper; and 30-59 days, 90-119 days, and 150179 days for finance paper.
5. Yields are quoted on a bank-discount basis, rather than an investment yield
basis (which would give a higher figure).
6. Dealer closing offered rates for top-rated banks. Most representative rate
(which may be, but need not be, the average of the rates quoted by the dealers).
7. Unweighted average of offered rates quoted by at least five dealers early in
the day.
8. Calendar week average. For indication purposes only.
9. Unweighted average of closing bid rates quoted by at least five dealers.
10. Rates are recorded in the week in which bills are issued. Beginning with the
Treasury bill auction held on Apr. 18, 1983, bidders were required to state the
percentage yield (on a bank discount basis) that they would accept to two decimal
places. Thus, average issuing rates in bill auctions will be reported using two
rather than three decimal places.
11. Yields are based on closing bid prices quoted by at least five dealers.
12. Yields adjusted to constant maturities by the U.S. Treasury. That is, yields
are read from a yield curve at fixed maturities. Based on only recently issued,
actively traded securities.
13. Each biweekly figure is the average of five business days ending on the
Monday following the date indicated. Until Mar. 31, 1983, the biweekly rate
determined the maximum interest rate payable in the following two-week period
on 2-!/2-year small saver certificates. (See table 1.16.)
14. Averages (to maturity or call) for all outstanding bonds neither due nor
callable in less than 10 years, including several very low yielding "flower" bonds.
15. General obligations based on Thursday figures; Moody's Investors Service.
16. General obligations only, with 20 years to maturity, issued by 20 state and
local governmental units of mixed quality. Based on figures for Thursday.
17. Daily figures from Moody's Investors Service. Based on yields to maturity
on selected long-term bonds.
18. Compilation of the Federal Reserve. This series is an estimate of the yield
on recently-offered, A-rated utility bonds with a 30-year maturity and 5 years of
call protection. Weekly data are based on Friday quotations. The Federal Reserve
previously published interest rate series on both newly-issued and recentlyoffered Aaa utility bonds, but discontinued these series in January 1984 owing to
the lack of Aaa issues.
19. 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.
Securities Markets
1.36
STOCK MARKET
A25
Selected Statistics
1984
1983
Indicator
1981
1982
1983
Aug.
Sept.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
Prices and trading (averages of daily figures)
Common stock prices
1 New York Stock Exchange
(Dec. 31, 1965 = 50)
2
Industrial
3 Transportation
4
Utility
5
Finance
6 Standard & Poor's Corporation (1941-43 = 10)' . . .
7 American Stock Exchange 2
(Aug. 31, 1973 = 100)
74.02
85.44
72.61
38.90
73.52
128.05
68.93
78.18
60.41
39.75
71.99
119.71
92.63
107.45
89.36
47.00
95.34
160.41
93.96
109.50
88.06
46.94
95.76
162.42
96.70
112.76
94.56
48.16
97.00
167.16
96.78
112.87
95.41
48.73
94.79
167.65
95.36
110.77
97.68
48.50
94.48
165.23
94.92
110.60
98.79
47.00
94.25
164.36
96.16
112.16
97.98
47.43
95.79
166.39
90.60
105.44
86.33
45.67
89.95
157.70
90.66
105.92
86.10
44.83
89.50
157.44
90.67
106.56
83.61
43.86
88.22
157.60
171.79
141.31
216.48
230.10
234.36
223.76
218.42
221.31
224.83
207.95
210.09
207.66
Volume of trading (thousands of shares)
8 New York Stock Exchange
9 American Stock Exchange
46,967
5,346
64,617
5,283
85,418
8,215
74,191
6,329
82,866
6,629
85,445
7,751
86,405
6,160
88,041
6,939
105,518
7,167
96,641
6,431
84,328
5,382
85,874
5,863
Customer financing (end-of-period balances, in millions of dollars)
10 Regulated margin credit at brokers-dealers
11 Margin stock 4
12 Convertible bonds
13 Subscription issues
Free credit balances at brokers5
14 Margin-account
15 Cash-account
3
14,411
13,325
23,000
19,437
20,124
21,030
22,075
23,000
23,132
22,557
22,668
14,150
259
2
12,980
344
1
22,720
279
1
19,090
346
1
19,760
363
1
20,690
339
1
21,790
285
1
22,720
279
1
22,870
261
1
22,330
226
1
22,460
208
3,515
7,150
5,735
8,390
6,620
8,430
6,350
8,035
6,550
7,930
6,630
7,695
6,512
7,599
6,620
8,430
6,51(K
8,230r
6,420
8,420
6,520
8,265
f
I
n.a.
*
Margin-account debt at brokers (percentage distribution, end of period)
16 Total
17
18
19
20
21
22
By equity class (in percent)6
Under 40
40-49
50-59
60-69
70-79
80 or more
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
37.0
24.0
17.0
10.0
6.0
6.0
21.0
24.0
24.0
14.0
9.0
8.0
41.0
22.0
16.0
9.0
6.0
6.0
23.0
28.0
20.0
13.0
9.0
7.0
24.0
27.0
21.0
12.0
9.0
7.0
35.0
24.0
17.0
10.0
7.0
7.0
48.0
22.0
17.0
10.0
7.0
6.0
41.0
22.0
16.0
9.0
6.0
6.0
43.0
21.0
15.0
9.0
6.0
6.0
48.0
20.0
13.0
8.0
6.0
5.0
46.0
20.0
14.0
9.0
6.0
5.0
n.a.
1
1
t
Special miscellaneous-account balances at brokers (end of period)
23 Total balances (millions of dollars)
7
Distribution by equity status (percent)
24 Net credit status
Debt status, equity of
25 60 percent or more
26
Less than 60 percent
25,870
35,598
58,329
50,267
51,211
54,029
57,490
58.0
62.0
63.0
62.0
64.0
63.0
63.0
63.0
31.0
11.0
29.0
9.0
28.0
9.0
31.0
7.0
29.0
7.0
28.0
9.0
29.0
8.0
28.0
9.0
58,329
63,411
65,855
61.0
59.0
61.0
29.0
10.0
29.0
12.0
28.0
11.0
62,670
I
1
n.a.
1
1
T
Margin requirements (percent of market value and effective date) 8
27 Margin stocks
28 Convertible bonds
29 Short sales
Mar. 11, 1968
June 8 1968
70
50
70
80
60
80
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. Beginning July 5, 1983, the American Stock Exchange rebased its index
effectively cutting previous readings in half.
3. Margin credit includes all credit extended to purchase or carry stocks or
related equity instruments and secured at least in part by stock. Credit extended is
end-of-month data for member firms of the New York Stock Exhange.
Besides assigning a current loan value to margin stock generally, Regulations T
and U permit special loan values for convertible bonds and stock acquired through
exercise of subscription rights.
4. A distribution of this total by equity class is shown on lines 17-22.
5. Free credit balances are in accounts with no unfulfilled commitments to the
brokers and are subject to withdrawal by customers on demand.
May 6, 1970
65
50
65
Dec. 6, 1971
Nov. 24, 1972
Jan. 3, 1974
55
50
55
65
50
65
50
50
50
6. Each customer's equity in his collateral (market value of collateral less net
debit balance) is expressed as a percentage of current collateral values.
7. Balances that may be used by customers as the margin deposit required for
additional purchases. Balances may arise as transfers based on loan values of
other collateral in the customer's margin account or deposits of cash (usually sales
proceeds) occur.
8. Regulations G, T, and U of the Federal Reserve Board of Governors,
prescribed in accordance with the Securities Exchange Act of 1934, limit the
amount of credit to purchase and carry margin stocks that may be extended on
securities as collateral by prescribing a maximum loan value, which is a specified
percentage of the market value of the collateral at the time the credit is extended.
Margin requirements are the difference between the market value (100 percent)
and the maximum loan value. The term "margin stocks" is defined in the
corresponding regulation.
A26
1.37
DomesticNonfinancialStatistics • May 1984
SELECTED FINANCIAL INSTITUTIONS
Selected Assets and Liabilities
Millions of dollars, end of period
1984
1983
Account
1981
1982
May
June
Aug.
July
Sept.
Oct.
Nov.
Dec.
Jan.
763,365
771,705
772,723
Feb.
Mar.?
Savings and loan associations
1
2
3
4
Assets
Mortgages
Cash and investment securities 1
Other
5 Liabilities and net worth
6
7
8
9
10
11
Savings capital
Borrowed money
FHLBB
Other
Loans in process 2
Other
729,920
733,074
741,416
746,998
748,491
756,953
664,167
707,646
518,547
63,123
82,497
483,614 473,481 474,510 479,322 48?, 178 482,305 485,366 489,720 493,432 494,682
85,438 104,245 102,063 102,546 99,812 100,243 101,553 101,553 103,395 101,883
138,594 152,194 156,501 159,548 164,008 165,943 170,034 172,259 174,878 176,158
664,167
707,646
729,920
733,074
741,416
746,998
748,491 756,953
763,365
771,705
772,723
525,061 567,961 601,731 605,282 610,826 615,369 618,002 622,577 625,013 634,076 639,694
89,235
86,322
84,267
85,976 87,367
91,443
84,342 84,694
97,850 82,731
88,782
51,735
54,234 53,579 52,182
52,179 52,678
52,626 50,880
62,794
63,861
54,392
33,797 34,689
37,500 38,817
35,442
30,108 31,115 32,085
25,988
33,989 28,339
17,967
19,728 21,117
21,498
18,812 19,209
9,934
15,998
17,094
6,385
14,548
19,179
15,777
18,615
15,496 17,458
15,275
15,140
17,527
15,544
15,602
17,936
780,107
796,968
497,987 502,646
103,917 108,719
178,203 185,603
780,107
796,968
644,588 656,844
86,526 93,557
50,465
50,766
36,061 42,791
21,939 22,947
14,908
17,520
12 Net worth 3
28,395
26,233
27,522
28,310
28,369
28,626
29,017
29,551
29,938
30,911
30,930
31,473
31,654
13 MEMO: Mortgage loan commitments
outstanding*
15,225
18,054
30,148
30,691
31,733
32,415
32,483
32,798
34,780
32,996
33,504
36,150
39,741
Mutual savings banks
5
194,217'
195,168
97,356'
19,129'
97,704'
20,469'
97,895
21,694
15,36C
2,177
43,58(K
6,263'
9,67 C
15,167'
2,180
43,541'
4,783'
10,373'
15,667
2,054
43,439
4,580
9,839
187,385' 189,149' 193,535'
194,217'
195,168
165,887 168,064' 169,356' 172,665' 173,637'
162,998 165,575' 167,006' 170,135' 171,099'
39,768 38,485' 38,448
38,554' 37,999
85,603 91,795' 93,073' 95,129' 96,520
2,538'
2,889
2,489'
2,350
2,53(K
9,185' 10,154'
9,932'
9,475
8,779'
9,879 10,015' 10,210' 10,368' 10,334'
174,349
171,935
37,642
96,983
2,414
9,932
10,566
175,728
174,197
180,071
181,975
182,822
183,612
186,041
187,385'
99,997
14,753
94,091
16,957
93,587
17,893
94,000
17,438
93,998
18,134
93,941
17,929
94,831
17,830
94,863'
19,589'
95,600
19,675'
9,810
2,288
37,791
5,442
5,649
9,743
2,470
36,161
6,919
7,855
13,110
2,260
39,142
5,960
8,118
13,572
2,257
40,206
6,224
8,276
13,931
2,248
40,667
5,322
8,522
14,484
2,247
41,045
5,168
8,799
14,794
2,244
41,889
5,560
8,893
14,634'
2,195'
42,092'
4,993'
9,019'
15,092'
2,195'
42,629'
4,983'
8,975'
22 Liabilities
175,728
174,197
180,071
181,975
182,822
183,612
186,041
23
24
25
26
27
28
29
30
155,110
153,003
49,425
103,578
2,108
10,632
9,986
155,196
152,777
46,862
96,369
2,419
8,336
9,235
162,287
159,840
40,467
83,506
2,447
3,114
9,377
163,990
161,573
40,451
84,705
2,417
7,754
9,575
164,848
162,271
39,983
85,445
2,577
7,596
9,684
165,087
162,600
39,360
86,446
2,487
7,884
9,932
1,293
1,285
1,860
1,884
1,969
2,046
14 Assets
15
16
17
18
19
20
21
Loans
Mortgage
Other
Securities
U.S. government 6
State and local government
Corporate and other 7
Cash
Other assets
Deposits
Regular 8
Ordinary savings
Time
Other
Other liabilities
General reserve accounts
MEMO: Mortgage9 loan commitments
outstanding
2,210
2,023
189,149' 193,535'
2,418
2,387
652,904
658,979
n.a.
n a.
n.a.
Life insurance companies
31 Assets
Securities
32 Government
33
United States 10
37
38
Bonds
Stocks
40 Real estate
42 Other assets
663,013
664,677
49,690
45,700 46,109 47,767
47,170
49,417
25,209 36,499 42,523 43,348 44,751
23,134 24,380
24,232
26,659
21,141 22,228 22,817
26,364
8,167
16,529 20,706
10,695
10,686
10,673
10,355
10,504
10,739 10,791
10,796
8,664
7,151
10,053
12,236 12,596
12,252
12,358
11,852
12,188
12,257
11,764
12,019
9,891
11,306
255,769 287,126 309,254 313,510 316,934 318,584 321,568 320,964 325,787 325,015 329,697
208,099 231,406 245,833 248,248 252,397 253,977 256,131 256,332 260,432 259,591 264,430
64,607
65,437 64,632 65,355
65,267
65,262 64,537
65,424
63,421
47,670 55,720
137,747 141,989 143,758 144,725 145,086 146,400 147,356 148,256 148,947 151,599 151,878
21,749
22,278
21,629 21,690
21,903 22,141
22,683 22,700
21,344
18,278 20,264
53,914 53,972
54,063
54,165 54,255
54,362
54,559
54,518
53,804
48,706 52,961
54,474
54,360
55,747
51,098 51,136 52,330 53,194 53,765
48,889
40,094 48,571
49,711
27,285
10,048
12,378
330,303
266,234
64,069
151,630
23,032
54,631
55,370
525,803
588,163
620,572
628,224
633,569
638,826
644,295 647,149
n.a.
Credit unions 12'
43 Total assetsAiabilities and capital
45
State
47 Federal
48
State
49 Savings
50 Federal (shares)
51
State (shares and deposits)
60,611
69,585
76,762
78,362
78,846
79,241
80,189
80,419
81,094
81,961
82,287
83,779
86,498
39,181
21,430
45,493
24,092
50,275
26,487
51,430
26,932
51,859
26,987
52,261
26,980
53,086
27,103
53,297
27,122
53,801
27,293
54,482
27,479
54,770
27,517
55,753
28,026
57,569
28,929
42,333
27,096
15,237
54,152
35.25C
18,902
43,232
27,948
15,284
62,990
41,352
21,638
44,058
28,512
15,546
70,475
46,192
24,283
45,006
29,175
15,831
71,610
47,145
24,465
45,647
29,672
15,975
72,232
47,713
24,519
46,940
30,582
16,358
72,214
47,847
24,367
47,829
31,212
16,617
73,280
48,709
24,571
48,454
31,691
16,763
73,661
49,044
24,617
49,240
32,304
16,936
74,051
49,400
24,651
50,083
32,930
17,153
74,739
49,889
24,850
50,477
33,270
17,207
75,373
50,438
24,935
51,386
33,878
17,508
76,423
51,218
25,205
52,353
34,510
17,843
79,150
52,905
26,245
Federal Finance
1.37
All
Continued
1984
1983
Account
1981
1982
May
July
June
Sept.
Aug.
Nov.
Oct.
Dec.
Jan.
Feb.
Mar.P
FSLIC-insured federal savings banks
52
53 Mortgages
54 Cash and investment securities
55 Other
6,859
33,667
39,660
41,763
46,191
57,496
59,422
61,717
64,969
69,835
72,143
3,353
21,248
5,901
6,518
25,236
6,675
7,749
26,494
6,890
8,379
28,086
7,514
10,591
34,814
9,245
13,437
35,637
9,587
14,198
37,166
9,653
14,898
38,698
10,436
15,835
41,754
11,243
16,838
43,371
11,662
17,110
56 Liabilities and net worth
6,859
33,667
39,660
41,763
46,191
57,496
59,422
61,717
64,969
69,835
72,143
57
58
59
60
61
62
5,877
27,419
4,146
2,755
1,391
759
1,343
32,446
4,831
3,094
1,737
755
1,628
34,108
5,008
3,131
1,877
919
1,728
37,284
5,445
3,572
1,873
1,142
2,320
47,058
6,598
4,192
2,406
1,089
2,751
48,544
6,775
4,323
2,452
1,293
2,810
50,384
6,981
4,381
2,600
1,428
2,924
53,227
7,477
4,640
2,837
1,157
3,108
57,195
8,048
4,751
3,297
1,347
3,245
59,107
8,088
4,884
3,204
1,545
3,403
Savings and capital
Borrowed money
FHLBB
Other
Other
Net worth 3
MEMO
63 Loans in process 2
64 Mortgage loan committments
outstanding 4
650
791
828
934
1,120
1,181
1,222
1,264
1,387
1,531
1,113
1,438
1,743
1,774
2,130
2,064
2,230
2,151
2,974
2,704
11. Issues of foreign governments and their subdivisions and bonds of the
International Bank for Reconstruction and Development.
12. As of June 1982, data include only federal or federally insured state credit
unions serving natural persons.
1. Holdings of stock of the Federal Home Loan Banks are in "other assets."
2. Beginning in 1982, loans in process are classified as contra-assets and are
not included in total liabilities and net worth. Total assets are net of loans in
process.
3. Includes net undistributed income accrued by most associations.
4. Excludes figures for loans in process.
5. The National Council reports data on member mutual savings banks and on
savings banks that have converted to stock institutions, and to federal savings
banks.
6. Beginning April 1979, includes obligations of U.S. government agencies.
Before that date, this item was included in "Corporate and other."
7. Includes securities of foreign governments and international organizations
and, before April 1979, nonguaranteed issues of U.S. government agencies.
8. Excludes checking, club, and school accounts.
9. Commitments outstanding (including loans in process) of banks in New
York State as reported to the Savings Banks Association of the State of New
York.
10. Direct and guaranteed obligations. Excludes federal agency issues not
guaranteed, which are shown in the table under "Business" securities.
1.38
NOTE. Savings and loan associations: Estimates by the FHLBB for all
associations in the United States. Data are based on monthly reports of federally
insured associations and annual reports of other associations. Even when revised,
data for current and preceding year are subject to further revision.
Mutual savings banks: Estimates of National Council of Savings Institutions for
all savings banks in the United States.
Life insurance companies: Estimates of the American Council of Life Insurance
for all life insurance companies in the United States. Annual figures are annualstatement asset values, with bonds carried on an amortized basis and stocks at
year-end market value. Adjustments for interest due and accrued and for
differences between market and book values are not made on each item separately
but are included, in total, in "other assets."
Credit unions: Estimates by the National Credit Union Administration for a
group of federal and federally insured state credit unions serving natural persons.
Figures are preliminary and revised annually to incorporate recent data.
FEDERAL FISCAL AND FINANCING OPERATIONS
Millions of dollars
Calendar year
Fiscal
year
1981
Type of account or operation
Fiscal
year
1982
Fiscal
year
1983
1982
HI
U.S. budget
1 Receipts'
2 Outlays 1
3 Surplus, or deficit ( - )
4 Trust funds
5 Federal funds 2 - 3
Off-budget entities (surplus, or deficit
6 Federal Financing Bank outlays
7 Other3-4
1983
H2
HI
1984
Jan.
Feb.
Mar.
599,272
657,204
-57,932
6,817
-64,749
617,766
728,375
-110,609
5,456
-116,065
600,562
795,917
-195,355
23,056
-218,410
322,478
348,678
-26,200
-17,690
-43,889
286,338
390,846
-104,508
-6,576
-97,934
306,331
396,477
-90,146
22,680
-112,822
62,537
68,052
-5,515
1,043
-6,558
47,886
68,267
-20,381
557
-20,938
44,464
73,020
-28,556
-2,827
-25,728
-20,769
-236
-14,142
-3,190
-10,404
-1,953
-7,942
227
-4,923
-2,267
-5,418
-528
-121
-129
-8
-198
-1,431
-296
-78,936
-127,940
-207,711
-33,914
-111,699
-96,094
-5,762
-20,588
-30,282
79,329
134,993
212,425
41,728
119,609
102,538
23,686
18,172
7,568
-1,878
1,485
-11,911
4,858
-9,889
5,176
-408
-7,405
-9,057
1,146
-9,664
3,222
-21,127
3,202
8,722
-6,306
9,415
13,299
18,670
3,520
15,150
29,164
10,975
18,189
37,057
16,557
20,500
10,999
4,099
6,900
19,773
5,033
14,740
100,243
19,442
72,037
28,544
7,153
21,392
23,758
3,226
20,531
14,054
3,684
10,369
(-))
U.S. budget plus off-budget, including
Federal Financing Bank
8 Surplus, or deficit ( - )
Source of financing
9 Borrowing from the public
10 Cash and monetary assets (decrease, or
increase ( - ) ) 4
11 Other 5
MEMO
12 Treasury operating balance (level, end of
period)
13 Federal Reserve Banks
14 Tax and loan accounts
1. Effective Feb. 8, 1982, supplemental medical insurance premiums and
voluntary hospital insurance premiums, previously included in other insurance
receipts, have been reclassified as offsetting receipts in the health function.
2. Half-year figures are calculated as a residual (total surplus/deficit less trust
fund surplus/deficit).
3. Other off-budget includes Postal Service Fund; Rural Electrification and
Telephone Revolving Fund; Rural Telephone Bank; and petroleum acquisition
and transportation and strategic petroleum reserve effective November 1981.
4. Includes U.S. Treasury operating cash accounts; SDRs; gold tranche
drawing rights; loans to International Monetary Fund; and other cash and
monetary assets.
5. Includes accrued interest payable to the public; allocations of special
drawing rights; deposit funds; miscellaneous liability (including checks outstanding) and asset accounts; seigniorage; increment on gold; net gain/loss for U.S.
currency valuation adjustment; net gain/loss for IMF valuation adjustment; and
profit on the sale of gold.
SOURCE. "Monthly Treasury Statement of Receipts and Outlays of the U.S.
Government." Treasury Bulletin, and the Budget of the United States Government, Fiscal Year 1985.
A28
1.39
DomesticNonfinancialStatistics • May 1984
U.S. BUDGET RECEIPTS AND OUTLAYS
Millions of dollars
Calendar year
Source or type
Fiscal
year
1981
Fiscal
year
1982
Fiscal
year
1983
1982
1983
HI
H2
HI
1984
Jan.
Feb.
Mar.
RECEIPTS
1 All sources
599,272
617,766
600,563
322,478
286,338
306,331
62,537
47,886
44,464
285,917
256,332
41
76,844
47,299
297,744
267,513
39
84,691
54,498
288,938
266,010
36
83,586
60,692
150,565
133,575
34
66,174
49,217
145,676
131,567
5
20,040
5,938
144,550
135,531
30
63,014
54,024
33,881
21,070
0
12,728
-82
22,190
23,523
4
1,501
2,838
12,895
26,877
9
2,776
16,766
73,733
12,596
65,991
16,784
61,780
24,758
37,836
8,028
25,661
11,467
33,522
13,809
2,985
1,366
1,892
1,833
9,441
1,476
182,720
201,498
209,001
108,079
94,278
110,521
21,462
19,972
17,702
156,932
172,744
179,010
88,795
85,063
90,912
19,446
16,774
16,704
6,041
15,763
3,984
7,941
16,600
4,212
6,756
18,799
4,436
7,357
9,809
2,119
177
6,857
2,181
6,427
11,146
2,1%
478
1,112
427
523
2,308
369
433
191
373
40,839
8,083
6,787
13,790
36,311
8,854
7,991
16,161
35,300
8,655
6,053
15,594
17,525
4,310
4,208
7,984
16,556
4,299
3,445
7,891
16,904
4,010
2,883
7,751
3,148
776
488
1,163
2,693
839
570
1,613
2,870
974
523
1,535
18 All types
657,204
728,424
795,917
348,683
390,847
396,477
68,052
68,267
73,020
19
20
21
22
23
24
National defense
International affairs
General science, space, and technology . . .
Energy
Natural resources and environment
Agriculture
159,765
11,130
6,359
10,277
13,525
5,572
187,418
9,982
7,070
4,674
12,934
14,875
210,461
8,927
7,777
4,035
12,676
22,173
93,154
5,183
3,370
2,946
5,636
7,087
100,419
4,406
3,903
2,059
6,940
13,260
105,072
4,705
3,486
2,073
5,892
10,154
18,283
709
503
255
963
1,835
18,515
780
721
34
790
1,737
19,516
1,180
611
265
861
1,315
25
26
27
28
Commerce and housing credit
Transportation
Community and regional development . . . .
Education, training, employment, social
services
3,946
23,381
9,394
3,865
20,560
7,165
4,721
21,231
7,302
1,408
9,915
3,055
2,244
10,686
4,186
2,164
9,918
3,124
709
1,953
434
-648
1,517
524
224
1,555
514
12,607
12,187
12,801
2,476
2,305
2,172
2,729
20,192
9,791
3,293
435
585
86
8,592
-824
2 Individual income taxes, net
3
Withheld
Presidential Election Campaign Fund . . .
4
5
Nonwithheld
6
Refunds
Corporation income taxes
7
Gross receipts
Refunds
8
9 Social insurance taxes and contributions,
net
10 Payroll employment taxes and
contributions 1
11 Self-employment taxes and
contributions 2
12 Unemployment insurance
13 Other net receipts 3
14
15
16
17
Excise taxes
Customs deposits
Estate and gift taxes
Miscellaneous receipts 4
OUTLAYS
29 Health
30 Social security and medicare
31 Income security
32
33
34
35
36
37
Veterans benefits and services
Administration of justice
General government
General-purpose fiscal assistance
Net interest^
Undistributed offsetting receipts 7
31,402
26,300
25,726
26,858
178,733
85,514
27,435
202,531
92,084
28,655]
223,311)
106,21 l j
150,001s
172,852
184,207
30,456
2,540
19,164
8,585
22,988
4,696
4,614
6,856
68,726
-16,509
23,955
4,671
4,726
6,393
84,697
-13,270
24,845
5,014
4,991
6,287
89,774
-21,424
112,782
2,334
2,400
3,325
41,883
-6,490
13,241
2,373
2,322
3,152
44,948
-8,333
11,334
2,522
2,434
3,124
42,358
-8,885
1,202
487
88
1,153
7,808
-1,263
2,108
505
495
201
9,801
-1,407
1. Old-age, disability, and hospital insurance, and railroad retirement accounts.
2. Old-age, disability, and hospital insurance.
3. Federal employee retirement contributions and civil service retirement and
disability fund.
4. Deposits of earnings by Federal Reserve Banks and other miscellaneous
receipts.
5. In accordance with the Social Security Amendments Act of 1983, the
Treasury now provides social security and medicare outlays as a separate
function. Before February 1984, these outlays were included in the income
security and health functions.
6. Net interest function includes interest received by trust funds.
7. Consists of rents and royalties on the outer continental shelf and U.S.
government contributions for employee retirement.
SOURCE. "Monthly Treasury Statement of Receipts and Outlays of the U.S.
Government" and the Budget of the U.S. Government, Fiscal Year 1985.
Federal Finance All
1.40
FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION
Billions of dollars
1984
1983
1982
Item
Mar. 31
June 30
Sept. 30
Dec. 31
Mar. 31
June 30
Sept. 30
Dec. 31
Mar. 31
1 Federal debt outstanding
1,066.4
1,084.7
1,147.0
1,201.9
1,249.3
1,324.3
1,381.9
1415.3
n.a.
2 Public debt securities
3
Held by public
4
Held by agencies
1,061.3
858.9
202.4
1,079.6
867.9
211.7
1,142.0
925.6
216.4
1,197.1
987.7
209.4
1,244.5
1,043.3
201.2
1,319.6
1,090.3
229.3
1,377.2
1,138.2
239.0
1,410.7
1174.4
236.3
1,463.7
5.1
3.9
1.2
5.0
3.9
1.2
5.0
3.7
1.2
4.8
3.7
1.2
4.8
3.7
1.1
4.7
3.6
1.1
4.7
3.6
1.1
4.6
3.5
1.1
5 Agency securities
6
Held by public
Held by agencies
7
i
|
n.a.
1
T
1,062.2
1,080.5
1,142.9
1,197.9
1,245.3
1,320.4
1,378.0
1,411.4
1,464.5
9 Public debt securities
10 Other debt 1
1,060.7
1.5
1,079.0
1.5
1,141.4
1.5
1,196.5
1.4
1,243.9
1.4
1,319.0
1.4
1,376.6
1.3
1,410.1
1.3
1,463.1
1.3
11 MEMO: Statutory debt limit
1,079.8
1,143.1
1,143.1
1,290.2
1,290.2
1,389.0
1,389.0
1,490.0
1,490.0
8 Debt subject to statutory limit
1. Includes guaranteed debt of government agencies, specified participation
certificates, notes to international lending organizations, and District of Columbia
stadium bonds.
1.41
GROSS PUBLIC DEBT OF U.S. TREASURY
NOTE. Data from Treasury Bulletin (U.S. Treasury Department),
Types and Ownership
Billions of dollars, end of period
1983
Type and holder
1 Total gross public debt
2
3
4
5
6
7
8
9
10
11
12
13
By type
Interest-bearing debt
Marketable
Bills
Notes
Bonds
Nonmarketable'
State and local government series
Foreign issues 2
Government
Public
Savings bonds and notes
Government account series 3
14 Non-interest-bearing debt
919
1980
1981
1984
1982
Q2
Q3
Q4
QL
845.1
930.2
1,028.7
1,197.1
1,319.6
1,377.2
1,410.7
1,463.7
844.0
530.7
172.6
283.4
74.7
313.2
24.6
28.8
23.6
5.3
79.9
177.5
928.9
623.2
216.1
321.6
85.4
305.7
23.8
24.0
17.6
6.4
72.5
185.1
1,027.3
720.3
245.0
375.3
99.9
307.0
23.0
19.0
14.9
4.1
68.1
196.7
1,195.5
881.5
311.8
465.0
104.6
314.0
25.7
14.7
13.0
1.7
68.0
205.4
1,318.1
978.9
334.3
527.1
117.5
339.2
33.1
11.4
10.8
.6
69.4
225.0
1,375.8
1,024.0
340.7
557.5
125.7
351.8
35.1
11.5
11.5
.0
70.3
234.7
1,400.9
1,050.9
343.8
573.4
133.7
350.0
36.7
10.4
10.4
.0
70.7
231.9
1,452.1
1,097.7
350.2
604.9
142.6
354.4
38.1
9.9
9.9
.0
71.6
234.6
11.6
1.2
1.3
1.4
1.6
1.5
1.5
9.8
15
16
17
18
19
20
21
22
By holder4
U.S. government agencies and trust funds
Federal Reserve Banks
Private investors
Commercial banks
Mutual savings banks
Insurance companies
Other companies
State and local governments
187.1
117.5
540.5
96.4
4.7
16.7
22.9
69.9
192.5
121.3
616.4
116.0
5.4
20.1
25.7
78.8
203.3
131.0
694.5
109.4
5.2
19.1
37.8
85.6
209.4
139.3
848.4
131.4
n.a.
229.3
141.7
948.6
171.6
28.3
44.8
32.8
239.0
155.4
982.7
176.3
22.1
47.3
35.9
236.3
151.9
1,022.6
188.9
22.8
48.9
40.2
113.4
n.a.
n.a.
n.a.
23
24
25
26
Individuals
Savings bonds
Other securities
Foreign and international 5
Other miscellaneous investors 6
79.9
36.2
124.4
90.1
72.5
56.7
127.7
106.9
68.0
75.6
141.4
152.3
68.3
48.2
149.4
233.2
69.7
51.6
160.1
70.6
58.4
160.2
71.5
61.9
168.9
n.a.
n.a.
n.a.
1. Includes (not shown separately): Securities issued to the Rural Electrification Administration; depository bonds, retirement plan bonds, and individual
retirement bonds.
2. Nonmarketable dollar-denominated and foreign currency-denominated
series held by foreigners.
3. Held almost entirely by U.S. government 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.
n.a.
38.7
n a.
5. Consists of investments of foreign and international accounts. Excludes noninterest-bearing notes issued to the International Monetary Fund.
6. Includes savings and loan associations, nonprofit institutions, credit unions,
mutual savings banks, corporate pension trust funds, dealers and brokers, certain
U.S. government deposit accounts, and U.S. government-sponsored agencies.
SOURCES. Data by type of security, U.S. Treasury Department, Monthly
Statement of the Public Debt of the United States; data by holder. Treasury
Bulletin.
A30
1.42
DomesticNonfinancialStatistics • May 1984
U.S. GOVERNMENT SECURITIES DEALERS
Transactions
Par value; averages of daily figures, in millions of dollars
1984
Item
1981
1982
1984 week ending Wednesday
1983
Jan.
Feb.
Mar.
Feb. 22
Feb. 29
Mar. 7
Mar. 14
Mar. 21
Mar. 28
1
Immediate delivery 1
U.S. government securities
24,728
32,271
42,135
45,623
52,445
50,344
51,037
55,040
47,162
44,793
50,719
52,509
2
3
4
5
6
By maturity
Bills
Other within 1 year
1-5 years
5-10 years
Over 10 years
14,768
621
4,360
2,451
2,528
18,398
810
6,272
3,557
3,234
22,393
708
8,758
5,279
4,997
23,140
1,119
9,615
5,647
6,102
24,937
895
11,827
8,052
6,734
23,278
906
11,038
7,798
7,324
28,165
909
10,053
6,262
5,648
25,033
999
12,653
9,714
6,641
21,657
807
8,926
9,120
6,651
22,561
752
8,309
6,689
6,482
25,408
819
10,793
6,663
7,037
22,633
1,107
15,138
6,923
6,708
By type of customer
U.S. government securities
dealers
U.S. government securities
brokers
All others 2
Federal agency securities
Certificates of deposit
Bankers acceptances
Commercial paper
Futures transactions 3
Treasury bills
Treasury coupons
Federal agency securities
Forward transactions 4
U.S. government securities
Federal agency securities
7
8
9
10
11
12
n
14
15
16
17
18
1,640
1,769
2,257
2,751
4,164
2,050
4,662
3,345
1,849
1,859
1,850
2,368
11,750
11,337
3,306
4,477
1,807
6,128
15,659
15,344
4,142
5,001
2,502
7,595
21,045
18,832
5,576
4,333
2,642
8,036
21,066
21,806
6,541
4,886
3,119
8,891
24,952
23,329
7,577
5,324
2,702
8,114
27,263
21,031
7,097
4,572
2,481
8,124
23,275
23,100
6,064
5,870
2,795
8,327
27,787
23,907
7,437
5,780
3,175
7,883
26,484
18,829
7,277
5,420
2,681
7,714
25,114
17,821
6,923
4,972
2,298
7,319
26,952
21,918
8,357
4,038
2,359
8,444
27,606
22,536
6,502
3,817
2,613
8,239
3,523
1,330
234
5,031
1,490
259
6,655
2,501
265
5,431
2,625
157
6,984
3,561
302
8,557
4,630
437
7,341
2,986
232
7,319
4,733
398
8,282
4,861
485
10,169
5,100
334
7,092
4,706
459
8,363
3,661
379
365
1,370
835
982
1,493
1,646
713
2,147
1,616
2,595
1,373
2,586
1,020
2,656
1,484
1,985
819
2,363
1,184
2,874
1,096
3,001
2,282
2,342
from the date of the transaction for government securities (Treasury bills, notes,
and bonds) or after 30 days for mortgage-backed agency issues.
NOTE. Averages for transactions are based on number of trading days in the
period.
Transactions are market purchases and sales of U.S. government securities
dealers reporting to the Federal Reserve Bank of New York. The figures exclude
allotments of, and exchanges for. new U.S. government securities, redemptions
of called or matured securities, purchases or sales of securities under repurchase
agreement, reverse repurchase (resale), or similar contracts.
1. Before 1981, data for immediate transactions include forward transactions.
2. Includes, among others, all other dealers and brokers in commodities and
securities, nondealer departments of commercial banks, foreign banking agencies,
and the Federal Reserve System.
3. Futures contracts are standardized agreements arranged on an organized
exchange in which parties commit to purchase or sell securities for delivery at a
future date.
4. Forward transactions are agreements arranged in the over-the-counter
market in which securities are purchased (sold) for delivery after 5 business days
1.43
U.S. GOVERNMENT SECURITIES DEALERS
Positions and Financing
Averages of daily figures, in millions of dollars
1984
Item
1981
1982
1984 week ending Wednesday
1983
Jan.
Feb.
Mar.
Feb. 22
Feb. 29
Mar. 7
Mar. 14
Mar. 21
Positions
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Net immediate 1
U.S. government securities
Bills
Other within 1 year
1-5 years
5-10 years
Over 10 years
Federal agency securities
Certificates of deposit
Bankers acceptances
Commercial paper
Futures positions
Treasury bills
Treasury coupons
Federal agency securities
Forward positions
U.S. government securities
Federal agency securities
9,033
6,485
-1,526
1,488
292
2,294
2,277
3,435
1,746
2,658
9,328
4,837
-199
2,932
-341
2,001
3,712
5,531
2,832
3,317
6,263
4,282
-177
1,709
-78
528
7,172
5,839
3,332
3,159
3,130
2,730
-158
1,552
-705
-288
11,236
6,528
3,494
2,754
1,290
3,226
-227
-428
-1,610
328
12,386
7,323
3,243
2,771
-4,215
-1,055
-362
-1,959
-326
-514
16,076
6,913
2,819
3,012
-3,166
472
-497
-2,874
-1,195
928
12,274
7,503
3,171
2,398
584
2,254
-403
-872
-1,281
886
12,413
7,838
3,062
2,438
-837
768
-329
-1,622
193
153
14,624
7,645
3,163
3,128
-4,225
-907
-286
-2,366
-416
-250
16,753
6,890
2,611
3,077
-5,999
-835
-265
-3,237
-821
-843
17,470
6,504
2,664
2,975
-8,934
-2,733
522
-2,508
-2,361
-224
-4,125
-1,032
170
-10,286
758
38
-7,796
1,254
-174
-1,128
2,053
201
1,585
-104
1,925
117
1,439
-220
2,226
163
2,411
380
-603
-451
-788
-1,190
-1,935
-3,561
-1,454
-7,506
-2,257
-8,019
-714
-9,747
-1,419
-8,059
-1,375
-8,159
-1,153
-8,412
-963
-10,451
-288
-10,658
40,617
58,848
40,444
62,432
36,363
64,922
39,064
64,818
41,483
63,773
68,768
51,099
72,256
50,974
69,013
54,391
69,488
51,977
70,281
54,380
Financing2
Reverse repurchase agreements 3
Overnight and continuing
Term agreements
Repurchase agreements 4
IX Overnight and continuing
19 Term agreements
16
17
For notes see opposite page.
14,568
32,048
26,754
48,247
29,099
52,493
37,309
60,280
39,798
60,666
35,919
29,449
49,695
43,410
57,946
44,410
67,685
51,123
70,126
52,109
A
f
n.a.
1
t
Federal Finance All
1.44
FEDERAL AND FEDERALLY SPONSORED CREDIT AGENCIES
Debt Outstanding
Millions of dollars, end of period
1983
Agency
1 Federal and federally sponsored agencies
2 Federal agencies
3 Defense Department 1
4
Export-Import Bank 2 3
Federal Housing Administration 4
5
6
Government National Mortgage Association
participation certificates 5
7
Postal Service 6
8
Tennessee Valley Authority
9
United States Railway Association 6
10 Federally sponsored agencies 7
11 Federal Home Loan Banks
12 Federal Home Loan Mortgage Corporation
13 Federal National Mortgage Association
14 Farm Credit Banks
15 Student Loan Marketing Association
1980
1981
1984
1982
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
188,665
221,946
237,085
239,121
240,177
239,716
239,872
241,628
382,398
28,606
610
11,250
477
31,806
484
13,339
413
33,055
354
14,218
288
33,735
258
14,740
203
33,813
253
14,740
197
33,940
243
14,853
194
33,919
234
14,852
173
33,785
215
14,846
169
32,800
206
15,347
166
2,817
1,770
11,190
492
2,715
1,538
13,115
202
2,165
1,471
14,365
194
2,165
1,404
14,840
125
2,165
1,404
14,945
109
2,165
1,404
14,970
111
2,165
1,404
14,980
111
2,165
1,404
14,875
111
2,165
1,404
14,805
111
160,059
37,268
4,686
55,182
62,923
(8)
190,140
54,131
5,480
58,749
71,359
421
204,030
55,967
4,524
70,052
71,896
1,591
205,386
49,956
6,950
71,965
73,465
3,050
206,364
49,285
7,024
73,531
73,474
3,050
205,776
48,930
6,793
74,594
72,409
3,050
205,953
48,344
6,679
74,676
73,023
3,231
207,843
48,224
7,556
75,865
72,856
3,342
211,891
48,594
8,633
77,966
73,180
3,518
87,460
110,698
126,424
134,799
135,361
135,791
135,940
135,859
137,707
10,654
1,520
2,720
9,465
492
12,741
1,288
5,400
11,390
202
14,177
1,221
5,000
12,640
194
14,676
1,154
5,000
13,175
125
14,676
1,154
5,000
13,220
109
14,789
1,154
5,000
13,245
111
14,789
1,154
5,000
13,255
111
14,789
1,154
5,000
13,150
111
15,296
1,154
5,000
13,080
111
39,431
9,196
11,262
48,821
13,516
12,740
53,261
17,157
22,774
55,916
19,093
25,660
55,916
19,216
26,070
55,266
19,766
26,460
54,776
19,927
26,928
54,471
19,982
27,202
55,186
20,186
27,694
MEMO
16 Federal Financing Bank debt
17
18
19
20
21
Lending to federal and federally sponsored
agencies
Export-Import Bank 3
Postal Service 6
Student Loan Marketing Association
Tennessee Valley Authority
United States Railway Association 6
Other Lending10
22 Farmers Home Administration
23 Rural Electrification Administration
24 Other
1. Consists of mortgages assumed by the Defense Department between 1957
and 1963 under family housing and homeowners assistance programs.
2. Includes participation certificates reclassified as debt beginning Oct. 1,1976.
3. Off-budget Aug. 17, 1974, through Sept. 30, 1976; on-budget thereafter.
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 1969 by the Government
National Mortgage Association acting as trustee for the Farmers Home Administration; Department of Health, Education, and Welfare; Department of Housing
and Urban Development; Small Business Administration; and the Veterans
Administration.
6. Off-budget.
NOTES TO TABLE 1.43
1. Immediate positions are net amounts (in terms of par values) of securities
owned by nonbank dealer firms and dealer departments of commercial banks on a
commitment, that is, trade-date basis, including any such securities that have
been sold under agreements to repurchase (RPs). The maturities of some
repurchase agreements are sufficiently long, however, to suggest that the securities involved are not available for trading purposes. Securities owned, and hence
dealer positions, do not include securities to resell (reverse RPs). Before 1981,
data for immediate positions include forward positions.
2. Figures cover financing involving U.S. government and federal agency
securities, negotiable CDs, bankers acceptances, and commercial paper.
7. Includes outstanding noncontingent liabilities: Notes, bonds, and debentures.
8. Before late 1981, the Association obtained financing through the Federal
Financing Bank.
9. The FFB, which began operations in 1974, is authorized to purchase or sell
obligations issued, sold, or guaranteed by other federal agencies. Since FFB
incurs debt solely for the purpose of lending to other agencies, its debt is not
included in the main portion of the table in order to avoid double counting.
10. Includes FFB purchases of agency assets and guaranteed loans; the latter
contain loans guaranteed by numerous agencies with the guarantees of any
particular agency being generally small. The Farmers Home Administration item
consists exclusively of agency assets, while the Rural Electrification Administration entry contains both agency assets and guaranteed loans.
3. Includes all reverse repurchase agreements, including those that have been
arranged to make delivery on short sales and those for which the securities
obtained have been used as collateral on borrowings, that is, matched agreements.
4. Includes both repurchase agreements undertaken to finance positions and
"matched book" repurchase agreements.
NOTE. Data for positions are averages of daily figures, in terms of par value,
based on the number of trading days in the period. Positions are shown net and are
on a commitment basis. Data for financing are based on Wednesday figures, in
terms of actual money borrowed or lent.
A32
DomesticNonfinancialStatistics • May 1984
1.45 NEW SECURITY ISSUES of State and Local Governments
Millions of dollars
1983
Type of issue or issuer,
or use
1981
1982
July
1 All issues, new and refunding 1
1984
1983
Sept.
Aug.
Oct.
Nov.
Dec.
Jan.
Feb.
47,732
78,950
85,092
4,370
6,194
6,160
6,650
5,829
8,854
5,066'
4,539
12,394
34
35,338
55
21,088
225
57,862
461
21,470
96
63,622
253
860
7
3,510
26
1,614
9
4,580
29
1,266
14
4,894
35
1,935
15
4,715
39
1,679
15
4,150
39
1,134
15
7,720
39
1,118'
0
3,948'
1
1,794
2
2,745
2
Type of issuer
6 State
7 Special district and statutory authority
8 Municipalities, counties, townships, school districts
5,288
27,499
14,945
8,406
45,000
25,544
7,135
50,632
27,325
484
3,009
877
673
3,357
2,164
452
4,199
1,509
856
4,387
1,407
405
3,318
2,106
198
5,790
2,866
325
1,235'
935
2,032
1,572
9 Issues for new capital, total
46,530
74,613
71,120
3,884
4,612
5,512
5,187
5,333
8,438
4,077'
3,850
Use of proceeds
Education
Transportation
Utilities and conservation
Social welfare
Industrial aid
Other purposes
4,547
3,447
10,037
12,729
7,651
8,119
6,444
6,256
14,254
26,605
8,256
12,797
8,170
4,353
13,547
26,378
7,088
11,584
535
274
268
1,920
393
494
714
261
285
2,139
254
959
527
195
1,238
2,334
494
724
457
250
605
2,580
323
972
515
336
1,101
2,080
516
785
744
421
1,230
2,676
2,317
1,050
399'
127
2,027
819
127
578
339
327
716
1,075
287
1,106
2
3
4
5
10
11
12
13
14
15
Type of issue
General obligation
U.S. government loans 2
Revenue
U.S. government loans 2
1. Par amounts of long-term issues based on date of sale.
2. Consists of tax-exempt issues guaranteed by the Farmers Home Administration.
1.46
SOURCE. Public Securities Association.
NEW SECURITY ISSUES of Corporations
Millions of dollars
Type of issue or issuer,
or use
1983
1981
1982
1984
1983
July
Aug.
Sept.
Oct.
Nov.
Dec.
Jan.
Feb.
1 All issues1'2
70,441
84,198
98,845
6,474
5,941
6,568
6,897'
8,103
6,812
7,691
7,595
2 Bonds
45,092
53,636
47,266
2,550
2,547
2,865
3,055
4,075
3,173
5,648
5,216
Type of offering
3 Public
4 Private placement
38,103
6,989
43,838
9,798
47,266
n.a.
2,550
n.a.
2,547
n.a.
2,865
n.a.
3,055
n.a.
4,075
n.a.
3,173
n.a.
5,648
n.a.
5,216
n.a.
12,325
5,229
2,052
8,963
4,280
12,243
13,123
5,681
1,474
12,155
2,265
18,938
8,133
5,374
1,086
7,066
3,380
22,227
60
228
148
322
1,100
692
200
458
0
355
0
1,534
282
353
0
590
100
1,540
367
114
0
510
50
2,014
22
23
111
910
0
3,009
423
201
105
120
0
2,324
179
976
10
325
210
3,948
452
626
75
385
0
3,678
11 Stocks3
25,349
30,562
51,579
3,924
3,394
3,703
3,842
4,028
3,639
2,043
2,379
Type
12 Preferred
13 Common
1,797
23,552
5,113
25,449
7,213
44,366
290
3,634
247
3,147
644
3,059
300
3,542
433
3,595
253
3,386
305
1,738
425
1,954
5,074
7,557
779
5,577
1,778
4,584
5,649
7,770
709
7,517
2,227
6,690
14,135
13,112
2,729
5,001
1,822
14,780
1,015
1,415
337
72
20
1,065
1,309
743
145
263
236
698
962
997
165
200
0
1,379
744
868
305
588
36
1,301
458
1,598
192
622
13
1,145
649
852
413
245
12
1,468
427
465
54
225
30
842
299
616
15
45
20
1,384
5
6
7
8
9
10
14
15
16
17
18
19
Industry group
Manufacturing
Commercial and miscellaneous.
Transportation
Public utility
Communication
Real estate and financial
Industry group
Manufacturing
Commercial and miscellaneous.
Transportation
Public utility
Communication
Real estate and financial
1. Figures, which represent gross proceeds of issues maturing in more than one
year, sold for cash in the United States, are principal amount or number of units
multiplied by offering price. Excludes offerings of less than $100,000, secondary
offerings, undefined or exempted issues as defined in the Securities Act of 1933,
employee stock plans, investment companies other than closed-end, intracorporate transactions, and sales to foreigners.
2. Data for 1983 include only public offerings.
3. Beginning in August 1981, gross stock offerings include new equity volume
from swaps of debt for equity.
SOURCE. Securities and Exchange Commission and the Board of Governors of
the Federal Reserve System.
Corporate Finance
1.47
OPEN-END INVESTMENT COMPANIES
A33
Net Sales and Asset Position
Millions of dollars
1984
1983
Item
1982
1983
Aug.
Sept.
Nov.
Oct.
Dec.
Jan.
Feb/
Mar.
INVESTMENT COMPANIES 1
1 Sales of own shares 2
2 Redemptions of own shares 3
3 Net sales
45,675
30,078
15,597
84,793
57,120
27,673
6,032
4,885
1,147
5,915
4,412
1,503
6,532
4,264
2,268
6,341
3,920
2,421
6,846
5,946
900
10,274
5,544
4,730
8,233
5,162
3,071
8,844
5,335
3,509
4 Assets 4
Cash position 5
5
6
Other
76,841
6,040
70,801
113,599
8,343
105,256
104,494
8,045
93,449
109,455
8,868
100,587
107,314
8,256
99,058
113,052
9,395
103,657
113,599
8,343
105,256
114,839
8,963
105,876
111,068
9,140
101,928
114,475
10,377
104,098
5. Also includes all U.S. government securities and other short-term debt
securities.
1. Excluding money market funds.
2. Includes reinvestment of investment income dividends. Excludes reinvestment of capital gains distributions and share issue of conversions from one fund to
another in the same group.
3. Excludes share redemption resulting from conversions from one fund to
another in the same group.
4. Market value at end of period, less current liabilities.
1.48
NOTE. Investment Company Institute data based on reports of members, which
comprise substantially all open-end investment companies registered with the
Securities and Exchange Commission. Data reflect newly formed companies after
their initial offering of securities.
CORPORATE PROFITS AND THEIR DISTRIBUTION
Billions of dollars; quarterly data are at seasonally adjusted annual rates.
1982
Account
1981
1982
1983
1983
Q1
Q2
Q3
Q4
QL
Q2
Q3
Q4
2
3
4
5
6
1 Corporate profits with inventory valuation and
capital consumption adjustment
Profits before tax
Profits tax liability
Profits after tax
Dividends
Undistributed profits
192.3
227.0
82.8
144.1
64.7
79.4
164.8
174.2
59.1
115.1
68.7
46.4
229.2
207.6
76.9
130.6
73.2
57.3
162.0
173.2
60.3
112.9
67.7
45.2
166.8
178.8
61.4
117.4
67.8
49.5
168.5
177.3
60.8
116.5
68.8
47.7
161.9
167.5
54.0
113.5
70.4
43.1
181.8
169.7
61.5
108.2
71.4
36.7
218.2
203.3
76.0
127.2
72.0
55.2
248.4
229.1
84.9
144.1
73.7
70.4
268.2
228.2
85.3
142.9
75.9
67.0
7 Inventory valuation
8 Capital consumption adjustment
-23.6
-11.0
-8.3
-1.1
-9.2
30.8
-5.5
-5.6
-8.5
-3.5
-9.0
.1
-10.3
4.7
-1.7
13.9
-10.6
25.6
-18.3
37.6
-6.3
46.2
SOURCE. Survey of Current Business (Department of Commerce).
A34
DomesticNonfinancialStatistics • May 1984
1.49 NONFINANCIAL CORPORATIONS
Current Assets and Liabilities
Billions of dollars, except for ratio
1982
1977
Account
1978
1979
1980
1983
1981
Q4
Ql'
Q2'
Q3 r
Q4
1 Current assets
912.7
1,043.7
1,214.8
1,327.0
1,419.3
1,425.4
1,437.3
1,465.1
1,522.5
1,561.2
2
3
4
5
6
97.2
18.2
330.3
376.9
90.1
105.5
17.2
388.0
431.8
101.1
118.0
16.7
459.0
505.1
116.0
126.9
18.7
506.8
542.8
131.8
131.8
17.4
530.3
585.1
154.6
144.0
22.4
511.0
575.2
172.6
138.7
26.0
518.4
573.4
180.7
145.0
27.9
535.0
571.0
186.2
148.1
26.6
563.4
590.7
193.7
164.9
30.2
579.0
591.9
195.3
7 Current liabilities
557.1
669.5
807.3
889.3
976.3
977.8
987.1
996.4
1,037.1
1,056.7
8 Notes and accounts payable
9 Other
317.6
239.6
383.0
286.5
460.8
346.5
513.6
375.7
558.8
417.5
552.8
425.0
542.7
444.4
550.8
445.6
577.3
459.9
598.8
457.9
355.5
374.3
407.5
437.8
442.9
447.6
450.2
468.6
485.4
504.6
1.492
1.454
1.458
1.456
1.470
1.468
1.477
Cash
U.S. government securities
Notes and accounts receivable
Inventories
Other
10 Net working capital
11 MEMO: Current ratio
1
1.638
1.559
1.505
1. Ratio of total current assets to total current liabilities.
All data in this table reflect the most current benchmarks. Complete data are
available upon request from the Flow of Funds Section, Division of Research and
Statistics, Board of Governors of the Federal Reserve System, Washington, D.C.
NOTE. For a description of this series, see "Working Capital of Nonfinancial
20551.
C o r p o r a t i o n s " in t h e J u l y 1978 BULLETIN, p p . 5 3 3 - 3 7 .
SOURCE. Federal Trade Commission and Bureau of the Census.
1.50 TOTAL NONFARM BUSINESS EXPENDITURES on New Plant and Equipment
Billions of dollars; quarterly data are at seasonally adjusted annual rates.
1982
Industry 1
1 Total nonfarm business
Manufacturing
2 Durable goods industries
3 Nondurable goods industries
Nonmanufacturing
4 Mining
Transportation
5
Railroad
6
Air
7
Other
Public utilities
8
Electric
9
Gas and other
10 Trade and services
11 Communication and other 2
1982
1983
1984
Q3
Q4
Q1
Q2
Q3
Q4
Q I1
Q21
316.43
302.50
343.57
313.76
303.18
293.03
293.46
304.70
318.83
332.66
335.40
56.44
63.23
51.78
59.75
62.78
66.93
56.61
61.65
50.51
59.72
50.74
59.12
48.48
60.31
53.06
58.06
54.85
61.50
59.21
65.49
59.01
67.25
15.45
11.83
14.34
14.57
13.41
12.03
10.91
11.93
12.43
13.57
13.87
4.38
3.93
3.64
3.92
3.77
3.50
4.73
2.78
4.49
4.01
4.07
3.21
4.35
4.76
3.22
3.35
4.09
3.60
3.64
4.10
3.14
4.07
3.57
3.36
4.63
3.32
3.91
4.09
2.42
4.57
4.85
2.82
4.31
33.40
8.55
86.95
40.46
34.99
7.00
87.94
38.02
35.54
9.24
100.25
42.47
34.73
8.29
86.88
39.75
35.15
7.85
84.36
39.84
33.97
7.64
82.38
36.11
34.86
6.62
85.85
35.54
35.84
6.38
91.06
37.38
35.31
7.37
92.44
43.05
35.51
8.21
98.56
41.03
35.72
8.95
97.93
40.68
1. Anticipated by business.
2. "Other" consists of construction; social services and membership organizations; and forestry, fisheries, and agricultural services.
1983
1984'
SOURCE. Survey of Current Business (Department of Commerce).
Corporate Finance
1.51 DOMESTIC FINANCE COMPANIES
A35
Assets and Liabilities
Billions of dollars, end of period
1983
Account
1977
1978
1979
1980
1981
1982
Q2
Q1
Q4
Q3
ASSETS
1
2
3
4
5
6
7
8
Accounts receivable, gross
Consumer
Business
Total
LESS: Reserves for unearned income and losses
Accounts receivable, net
Cash and bank deposits
Securities
All other
9 Total assets
52.6
63.3
116.0
15.6
100.4
3.5 1
1.3 ^
17.3
65.7
70.3
136.0
20.0
116.0
73.6
72.3
145.9
23.3
122.6
85.5
80.6
166.1
28.9
137.2
89.5
81.0
170.4
30.5
139.8
89.9
82.2
172.1
29.7
142.4
91.3
84.9
176.2
30.4
145.8
92.3
86.8
179.0
30.1
148.9
92.8
95.2
188.0
30.6
157.4
24.9'
27.5
34.2
39.7
42.8
44.3
45.0
45.3
104.3
122.4
140.9
150.1
171.4
179.5
185.2
190.2
193.9
202.7
5.9
29.6
6.5
34.5
8.5
43.3
13.2
43.4
15.4
51.2
18.6
45.8
16.6
45.2
16.3
49.0
17.0
49.7
19.1
53.6
6.2
36.0
11.5
8.1
43.6
12.6
8.2
46.7
14.2
7.5
52.4
14.3
9.6
54.8
17.8
8.7
63.5
18.7
9.8
64.7
22.8
9.6
64.5
24.0
8.7
66.2
24.4
11.3
65.4
27.1
44.0
55.2
99.2
12.7
86.5
2.6
.9
14.3
/
LIABILITIES
10 Bank loans
11 Commercial paper
Debt
12 Short-term, n.e.c
13 Long-term, n.e.c
14 Other
15 Capital, surplus, and undivided profits
16 Total liabilities and capital
15.1
17.2
19.9
19.4
22.8
24.2
26.0
26.7
27.9
26.2
104.3
122.4
140.9
150.1
171.4
179.5
185.2
190.2
193.9
202.7
1. Beginning Q1 1979, asset items on lines 6, 7, and 8 are combined.
NOTE. Components may not add to totals due to rounding.
1.52
DOMESTIC FINANCE COMPANIES
Business Credit
Millions of dollars, seasonally adjusted except as noted
Extensions
Changes in accounts
receivable
Type
Accounts
receivable
outstanding
Feb. 29,
1984'
1983
Dec.
1984
Jan.
1984
1983
Feb.
Repayments
1983
1984
Dec.
Jan.
Feb.
Dec.
Jan.
Feb.
1 Total
99,338
2,721
2,973
1,934
27,338
30,660
28,218
24,617
27,687
26,284
2
3
4
5
22,437
16,471
29,069
485
583
602
959
625
449
700
638
568
1,836
7,690
1,610
2,347
9,392
1,525
2,157
9,856
1,488
1,351
7,107
1,008
1,388
8,767
1,076
1,457
9,218
920
10,958
20,403
121
930
1,037
-97
-117
145
13,441
2,761
14,787
2,609
12,313
2,404
13,320
1,831
13,750
2,706
12,430
2,259
Retail automotive (commercial vehicles)
Wholesale automotive
Retail paper on business, industrial, and farm equipment
Loans on commercial accounts receivable and factored commercial accounts receivable
6 All other business credit
1. Not seasonally adjusted.
A36
1.53
Domestic Financial Statistics • May 1984
MORTGAGE
MARKETS
Millions of dollars; exceptions noted.
1983
Sept.
Oct.
1984
Nov.
Dec.
Jan.
Feb.
Mar.
Terms and yields in primary and secondary markets
PRIMARY MARKETS
1
2
3
4
5
6
Conventional mortgages on new homes
Terms1
Purchase price (thousands of dollars)
Amount of loan (thousands of dollars)
Loan/price ratio (percent)
Maturity (years)
Fees and charges (percent of loan amount)2
Contract rate (percent per annum)
Yield (percent per annum)
7 FHLBB series3
8 HUD series4
90.4
65.3
74.8
27.7
2.67
14.16
94.6
69.8
76.6
27.6
2.95
14.47
92.8
69.6
77.1
26.7
2.40
12.20
100.7
76.5
78.5
27.2
2.45
12.08
95.8
72.5
78.4
26.9
2.33
11.80
98.0
76.7
80.5
26.5
2.54
11.82
94.8
73.3
79.1
27.3
2.56
11.94
92.9
71.7
79.2
27.8
2.61
11.80
104.1'
77.8'
77.8'
27.3'
2.41'
11.78'
93.6
73.0
80.2
28.0
2.54
11.64
14.74
16.52
15.12
15.79
12.66
13.43
12.54
13.60
12.25
13.52
12.34
13.48
12.42
13.41
12.29
13.28
12.23'
13.31'
12.11
13.57
16.31
15.29
15.31
14.68
13.11
12.26
13.55
12.73
13.23
12.42
13.23
12.51
13.25
12.49
13.08
12.35
13.20
12.31
13.68
12.70
SECONDARY MARKETS
Yield (percent per annum)
9 FHA mortgages (HUD series)5
10 GNMA securities6
Activity in secondary markets
FEDERAL NATIONAL MORTGAGE ASSOCIATION
Mortgage holdings (end of period)
11 Total
12 FHA/VA-insured
13 Conventional
58,675
39,341
19,334
66,031
39,718
26,312
74,847
37,393
37,454
75,174
36,670
38,505
75,665
36,455
39,210
76,714
36,349
40,365
78,256
36,211
42,045
79,049
40,873
38,177
79,350
35,420
43,930
80,974
35,329
45,645
Mortgage transactions (during period)
14 Purchases
15 Sales
6,112
2
15,116
2
17,554
3,528
1,203
464
1,244
257
1,348
0
2,204
250
1,285
20
1,507
723
2,030
0
Mortgage commitments7
16 Contracted (during period)
17 Outstanding (end of period)
9,331
3,717
22,105
7,606
18,607
5,461
2,739
6,684
1,882
7,182
997
6,493
1,471
5,461
1,772
5,470
1,930
5,872
1,626
5,333
Mortgage holdings (end of period)9
18 Total
19 FHA/VA
20 Conventional
5,231
1,065
4,166
5,131
1,027
4,102
5,996
974
5,022
6,857
961
5,8%
6,971
955
6,016
7,093
940
6,153
7,633
941
6,691
8,049
940
7,109
8,566
934
7,632
Mortgage transactions (during period)
21 Purchases
22 Sales
3,800
3,531
23,673
24,170
23,089
19,686
2,263
1,556
2,886
2,750
1,287
1,143
1,685
1,115
1,419
984
1,389
810
Mortgage commitments9
23 Contracted (during period)
24 Outstanding (end of period)
6,896
3,518
28,179
7,549
32,852
16,964
3,283
16,512
2,598
16,198
2,093
16,994
1,704
16,964
1,470
16,994
1,386
16,944
FEDERAL H O M E LOAN MORTGAGE CORPORATION
1. Weighted averages based on sample surveys of mortgages originated by
major institutional lender groups; compiled by the Federal Home Loan Bank
Board in cooperation with the Federal Deposit Insurance Corporation.
2. Includes all fees, commissions, discounts, and "points" paid (by the
borrower or the seller) to obtain a loan.
3. Average effective interest rates on loans closed, assuming prepayment at the
end of 10 years.
4. Average contract rates on new commitments for conventional first mortgages; from Department of Housing and Urban Development.
5. Average gross yields on 30-year, minimum-downpayment, Federal Housing
Administration-insured first mortgages for immediate delivery in the private
secondary market. Any gaps in data are due to periods of adjustment to changes in
maximum permissible contract rates.
n.a.
6. Average net yields to investors on Government National Mortgage Association guaranteed, mortgage-backed, fully modified pass-through securities, assuming prepayment in 12 years on pools of 30-year FHA/VA mortgages carrying the
prevailing ceiling rate. Monthly figures are unweighted averages of Monday
quotations for the month.
7. Includes some multifamily and nonprofit hospital loan commitments in
addition to 1- to 4-family loan commitments accepted in FNMA's free market
auction system, and through the FNMA-GNMA tandem plans.
8. Includes participation as well as whole loans.
9. Includes conventional and government-underwritten loans. FHLMC's mortgage commitments and mortgage transactions include activity under mortgage/
securities swap programs, while the corresponding data for FNMA exclude swap
activity.
Real Estate Debt
1.54
A37
MORTGAGE DEBT OUTSTANDING
Millions of dollars, end of period
1984
1983
Type of holder, and type of property
1981
1982
1983
QL
1 All holders
2
3
4
5
1- to 4-family
Multifamily
Commercial
Farm
6 Major financial institutions
7 Commercial banks 1
8
1- to 4-family
9
Multifamily
Commercial
10
11
Farm
12
13
14
Q2
Q4
Q3
QL
1,583,264
1,065,294
136,354
279,889
101,727
1,655,013
1,105,756
140,542
302,009
106,706
1,826,356'
1,214,550'
150,950'
351,289'
109,567'
1,681,630
1,122,111
141,500
311,107
106,912
1,723,052
1,146,926
144,731
323,427
107,968
1,775,117
1,182,356
147,052
336,697
109,012
1,826,356'
1,214,550'
150,950'
351,289'
109,567'
1,871,215
1,247,780
153,870
359,343
110,222
1,040,827
284,536
170,013
15,132
91,026
8,365
1,023,541
300,203
173,157
16,421
102,219
8,406
1,109,975'
328,878'
181,672'
18,023'
119,843'
9,340'
1,028,802
303,371
172,346
16,230
106,301
8,494
1,048,688
310,217
174,032
16,876
110,437
8,872
1,079,605
320,299
178,054
17,424
115,692
9,129
1,109,975'
328,878'
181,672'
18,023'
119,843'
9,340'
1,134,658
337,878
185,833
18,583
123,832
9,630
99,997
68,187
15,960
15,810
40
97,805
66,777
15,305
15,694
29
136,066'
96,577'
17,787'
21,673'
29
105,378
73,240
15,587
16,522
29
119,236
84,349
16,667
18,192
28
129,645
92,467
17,588
19,562
28
136,066'
96,577'
17,787'
21,673'
29
142,255
101,176
18,341
22,708
30
16
Mutual savings banks
1- to 4-family
Multifamily
Commercial
Farm
17
18
19
20
Savings and loan associations
1- to 4-family
Multifamily
Commercial
518,547
433,142
37,699
47,706
483,614
393,323
38,979
51,312
493,432
389,811
42,435
61,186
477,022
384,718
39,259
53,045
474,510
377,947
39,954
56,609
482,305
381,744
41,334
59,227
493,432
389,811
42,435
61,186
502,646
396,336
43,479
62,831
21
22
23
24
25
Life insurance companies
1- to 4-family
Multifamily
Commercial
Farm
137,747
17,201
19,283
88,163
13,100
141,919
16,743
18,847
93,501
12,828
151,599
15,385
19,189
104,279
12,746
143,031
16,388
18,825
95,158
12,660
144,725
15,860
18,778
97,416
12,671
147,356
15,534
18,857
100,209
12,756
151,599
15,385
19,189
104,279
12,746
151,879
15,351
19,207
104,621
12,700
126,094
4,765
693
4,072
138,185
4,227
676
3,551
147,371'
3,395
630
2,765
140,028
3,753
665
3,088
142,094
3,643
651
2,992
142,224
3,475
639
2,836
147,371'
3,395
630
2,765
151,396
3,273
607
2,666
15
26 Federal and related agencies
27 Government National Mortgage Association
28
1- to 4-family
29
Multifamily
30
31
32
33
34
Farmers Home Administration
1- to 4-family
Multifamily
Commercial
Farm
2,235
914
473
506
342
1,786
783
218
377
408
2,141
1,159
173
409
400
2,077
707
380
337
653
1,605
381
555
248
421
600
211
32
113
244
2,141
1,159
173
409
400
2,141
1,159
173
409
400
35
36
37
Federal Housing and Veterans
Administration
1- to 4-family
Multifamily
5,999
2,289
3,710
5,228
1,980
3,248
4,894'
1,893'
3,001'
5,138
1,867
3,271
5,084
1,911
3,173
5,050
2,061
2,989
4,894'
1,893'
3,001'
4,969
1,929
3,040
38
39
40
Federal National Mortgage Association
1- to 4-family
Multifamily
61,412
55,986
5,426
71,814
66,500
5,314
78,256
73,045
5,211
73,666
68,370
5,296
74,669
69,396
5,273
75,174
69,938
5,236
78,256
73,045
5,211
80,975
75,770
5,205
41
42
43
Federal Land Banks
1- to 4-family
Farm
46,446
2,788
43,658
50,350
3,068
47,282
51,052
3,000
48,052
50,544
3,059
47,485
50,858
3,030
47,828
51,069
3,008
48,061
51,052
3,000
48,052
51,022
2,993
48,029
44
45
46
Federal Home Loan Mortgage Corporation
1- to 4-family
Multifamily
5,237
5,181
56
4,780
4,733
47
7,633
7,576
57
4,850
4,795
55
6,235
6,119
116
6,856
6,799
57
7,633
7,576
57
9,016
8,951
65
163,000
105,790
103,007
2,783
216,654
118,940
115,831
3,109
285,021
159,850
155,801
4,049
234,596
127,939
124,482
3,457
252,665
139,276
135,628
3,648
272,611
151,597
147,761
3,836
285,021
159,850
155,801
4,049
297,690
166,914
162,596
4,318
19,853
19,501
352
42,964
42,560
404
57,843
57,206
637
48,008
47,575
433
50,934
50,446
488
54,152
53,539
613
57,843
57,206
637
59,422
58,755
667
717
717
14,450
14,450
25,121
25,121
18,157
18,157
20,933
20,933
23,819
23,819
25,121
25,121
28,354
28,354
36,640
18,378
3,426
6,161
8,675
40,300
20,005
4,344
7,011
8,940
42,207
20,404
5,090
7,351
9,362
40,492
20,263
4,344
7,115
8,770
41,522
20,728
4,343
7,303
9,148
43,043
21,083
5,042
7,542
9,376
42,207
20,404
5,090
7,351
9,362
43,000
20,787
5,186
7,489
9,538
253,343
167,297
27,982
30,517
27,547
276,633
185,170
30,755
31,895
28,813
283,989'
185,270'
32,533'
36,548'
29,638'
278,204
185,479
31,275
32,629
28,821
279,605
185,515
31,868
33,222
29,000
280,677
185,699
31,208
34,352
29,418
283,989'
185,270'
32,533'
36,548'
29,638'
287,471
187,183
32,940
37,453
29,895
47 Mortgage pools or trusts 2
48 Government National Mortgage Association
49
1- to 4-family
50
Multifamily
51
52
53
Federal Home Loan Mortgage Corporation
1- to 4-family
Multifamily
54
55
Federal National Mortgage Association 3
1- to 4-family
56
57
58
59
60
Farmers Home Administration
1- to 4-family
Multifamily
Commercial
Farm
61 Individual and others 4
1- to 4-family5
62
63 Multifamily
64
Commercial
65
Farm
1. Includes loans held by nondeposit trust companies but not bank trust
departments.
2. Outstanding principal balances of mortgages backing securities insured or
guaranteed by the agency indicated.
3. Outstanding balances on FNMA's issues of securities backed by pools of
conventional mortgages held in trust. The program was implemented by FNMA in
October 1981.
4. Other holders include mortgage companies, real estate investment trusts,
state and local credit agencies, state and local retirement funds, noninsured
pension funds, credit unions, and U.S. agencies for which amounts are small or
for which separate data are not readily available.
5. Includes a new estimate of residential mortgage credit provided by individuals.
NOTE. Based on data from various institutional and governmental sources, with
some quarters estimated in part by the Federal Reserve in conjunction with the
Federal Home Loan Bank Board and the Department of Commerce. Separation of
nonfarm mortgage debt by type of property, if not reported directly, and
interpolations and extrapolations when required, are estimated mainly by the
Federal Reserve. Multifamily debt refers to loans on structures of five or more
units.
A38
DomesticNonfinancialStatistics • May 1984
1.55 CONSUMER INSTALLMENT CREDIT 1 Total Outstanding, and Net Change A
Millions of dollars
1983
iyoi
1984
lyoz
Aug.
Sept.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Amounts outstanding (end of period)
314,910
335,691
355,849
371,295
375,246
379,334
384,410
396,082
394,922
399,177
402,466
By major holder
Commercial banks
Finance companies
Credit unions
Retailers 2
Savings and loans
Gasoline companies
Mutual savings banks
147,013
76,756
44,041
28,697
9,911
4,468
4,024
147,622
89,818
45,953
31,348
12,410
4,403
4,137
152,490
98,693
47,253
32,735
15,823
4,063
4,792
158,402
102,541
50,121
30,648
19,461
4,457
5,665
160,973
102,174
51,123
30,926
19,985
4,338
5,727
163,274
102,338
51,767
31,337
20,472
4,243
5,903
165,670
102,560
52,578
32,371
21,023
4,157
6,051
171,978
102,862
53,471
35,911
21,615
4,131
6,114
171,934
101,680
53,882
34,505
21,823
4,300
6,798
175,941
101,702
54,851
33,455
22,269
4,025
6,934
177,625
101,619
55,892
33,208
23,071
3,944
7,107
By major type of credit
9 Automobile
10 Commercial banks
11
Indirect paper
12
Direct loans
13 Credit unions
14 Finance companies
116,838
61,536
35,233
26,303
21,060
34,242
125,331
58,081
34,375
23,706
21,975
45,275
131,086
59,555
34,755
23,472
22,596
48,935
138,242
62,178
(33)
()
23,972
52,092
139,002
63,448
(33)
()
24,451
51,103
140,101
64,780
(33)
()
24,759
50,562
141,107
65,917
(33)
()
25,147
50,043
142,449
67,557
(33)
()
25,574
49,318
143,186
68,747
(33)
()
25,771
48,668
146,047
71,327
(33)
()
26,234
48,486
146,047
71,237
(33)
()
26,732
48,078
15 Revolving
16 Commercial banks
17 Retailers
18 Gasoline companies
58,506
29,765
24,273
4,468
64,500
32,880
27,217
4,403
69,998
36,666
29,269
4,063
70,006
38,162
27,387
4,457
71,039
39,041
27,660
4,338
72,105
39,774
28,088
4,243
74,032
40,774
29,101
4,157
80,823
44,184
32,508
4,131
78,566
43,118
31,148
4,300
77,671
43,506
30,140
4,025
79,110
45,235
29,931
3,944
19 Mobile home
20 Commercial banks
21
Finance companies
22
Savings and loans
23 Credit unions
17,321
10,371
3,745
2,737
469
17,958
10,187
4,494
2,788
489
22,254
9,605
9,003
3,143
503
22,993
9,851
9,140
3,471
531
23,189
9,876
9,1%
3,575
542
23,358
9,877
9,250
3,682
549
23,492
9,871
9,270
3,793
558
23,680
9,842
9,365
3,906
567
23,668
9,829
9,345
3,923
571
23,571
9,663
9,324
4,003
581
23,661
9,589
9,333
4,147
592
122,244
45,341
38,769
22,512
4,424
7,174
4,024
127,903
46,474
40,049
23,490
4,131
9,622
4,137
132,511
46,664
40,755
24,154
3,466
12,680
4,792
140,054
48,211
41,309
25,618
3,261
15,990
5,665
142,016
48,608
41,875
26,130
3,266
16,410
5,727
143,770
48,843
42,526
26,459
3,249
16,790
5,903
145,779
49,108
43,247
26,873
3,270
17,230
6,051
149,130
50,395
44,179
27,330
3,403
17,709
6,114
149,502
50,240
43,667
27,540
3,357
17,900
6,798
151,888
51,445
43,892
28,036
3,315
18,266
6,934
153,648
51,564
44,208
28,568
3,277
18,924
7,107
1 Total
2
3
4
5
6
7
8
24 Other
25
Commercial banks
26
Finance companies
27 Credit unions
28 Retailers
29
Savings and loans
30
Mutual savings banks
Net change (during period) 4
1,448
18,217
13,096
4,093
2,553
5,093
4,819
5,782
4,469
6,608
5,870
-7,163
8,438
-2,475
329
1,485
739
95
607
13,062
1,913
1,103
1,682
-65
-85
4,442
4,504
1,298
651
2,290
-340
251
2,278
638
510
164
265
65
173
1,709
-385
646
225
448
-167
77
2,713
470
942
215
437
131
185
2,832
-40
912
318
584
58
155
3,977
-146
731
537
589
-31
126
2,029
-66
916
422
364
72
731
4,914
258
712
325
414
-172
156
3,422
-193
1,230
355
813
2
242
477
-5,830
-3,104
-2,726
-1,184
7,491
8,495
-3,455
-858
-2,597
914
11,033
4,898
-9
225
-234
622
3,505
2,372
2,063
(3)
(3)
232
77
295
1,014
(3)
(3)
309
-1,028
1,709
1,483
(3)
(3)
451
-225
1,268
1,257
(3)
(3)
436
-425
1,468
1,568
(3)
(3)
349
-449
2,106
1,722
(3)
(3)
428
-44
2,799
2,635
(3)
(3)
276
-112
326
432
(3)
(3)
660
-766
45 Revolving
46
Commercial banks
47
Retailers
48 Gasoline companies
1,415
-97
773
739
4,467
3,115
1,417
-65
4,365
3,808
897
-340
541
315
161
65
579
511
235
-167
1,238
875
232
131
1,427
1,040
329
58
1,690
1,207
515
-31
505
18
414
72
1,273
1,127
318
-172
2,962
2,613
347
2
49 Mobile home
50 Commercial banks
51
Finance companies
52 Savings and loans
53 Credit unions
483
-276
355
430
-25
1,049
-186
749
466
20
609
-508
471
633
14
222
-11
153
75
5
255
10
137
101
7
-30
23
-158
95
10
-64
-4
-164
94
10
1
39
-166
120
9
-92
-15
-104
18
9
-127
-112
-93
68
10
285
-85
218
141
10
-927
-960
592
-1,266
-444
1,056
95
4,206
1,133
1,280
975
-314
1,217
-85
3,224
372
528
662
-246
1,657
251
958
-89
408
273
3
190
173
1,424
174
506
330
-10
347
77
2,176
332
853
481
-17
342
185
2,188
539
549
466
-11
490
155
2,623
1,163
469
374
22
469
126
1,950
304
82
479
8
346
731
2,662
1,264
463
426
7
346
156
2,298
463
355
558
7
673
242
31 Total
32
33
34
35
36
37
38
By major holder
Commercial banks
Finance companies
Credit unions
Retailers 2
Savings and loans
Gasoline companies
Mutual savings banks
By major type of credit
39 Automobile
40 Commercial banks
41
Indirect paper
42
Direct loans
43
Credit unions
44
Finance companies
54 Other
55 Commercial banks
56 Finance companies
57 Credit unions
58 Retailers
59 Savings and loans
60 Mutual savings banks
• These data have been revised from July 1979 through February 1984.
1. The Board's series cover most short- and intermediate-term credit extended
to individuals through regular business channels, usually to finance the purchase
of consumer goods and services or to refinance debts incurred for such purposes,
and scheduled to be repaid (or with the option of repayment) in two or more
installments.
2. Includes auto dealers and excludes 30-day charge credit held by travel and
entertainment companies.
3. Not reported after December 1982.
4. For 1982 and earlier, net change equals extensions, seasonally adjusted less
liquidations, seasonally adjusted. Beginning 1983, net change equals outstandings,
seasonally adjusted less outstandings of the previous period, seasonally adjusted.
NOTE: Total consumer noninstallment credit outstanding—credit scheduled to
be repaid in a lump sum, including single-payment loans, charge accounts, and
service credit—amounted to, not seasonally adjusted, $79.4 billion at the end of
1981, $84.5 billion at the end of 1982, and $95.5 billion at the end of 1983.
Consumer Debt
A39
1.56 TERMS OF CONSUMER INSTALLMENT CREDIT
Percent unless noted otherwise
1984
1983
Item
1981
1982
1983
Sept.
Nov.
Oct.
Dec.
Jan.
Feb.
Mar.
INTEREST RATES
Commercial banks 1
1
~>
4
6
Auto finance companies
New car
Used car
16.54
18.09
17.45
17.78
16.83
18.65
18.05
18.51
13.92
16.68
15.91
18.73
16.17
20.00
16.15
20.75
12.58
18.74
13.62
18.21
13.54
18.15
13.50
18.16
13.92
18.06
14.18
17.54
14.11
17.59
14.05
17.52
45.4
35.8
46.0
34.0
45.9
37.9
46.2
38.0
46.2
38.0
46.3
38.0
46.3
37.9
46.3
39.5
46.4
39.4
46.7
39.4
86.1
91.8
85.3
90.3
86.0
92.0
87
93
86
93
86
93
87
92
88
92
87
91
87
92
7,339
4,343
8,178
4,746
8,787
5,033
8,792
5,144
8,982
5,213
9,118
5,316
9,167
5,401
9,099
5,392
9,072
5,418
9,139
5,474
13.46
16.39
15.47
18.75
13.32
16.16
15.45
18.73
OTHER TERMS 3
7
8
9
10
11
12
Maturity (months)
New car
Used car
Loan-to-value ratio
New car
Used car
Amount financed (dollars)
New car
Used car
1. Data for midmonth of quarter only.
2. Before 1983 the maturity for new car loans was 36 months, and for mobile
home loans was 84 months.
3. At auto finance companies.
A40
1.57
DomesticNonfinancialStatistics • May 1984
F U N D S R A I S E D IN U . S . CREDIT M A R K E T S
Billions of dollars; half-yearly data are at seasonally adjusted annual rates.
1981
1982
1983
ly/y
HI
H2
HI
H2
HI
H2
Nonfinancial sectors
1 Total net borrowing by domestic nonfinancial sectors . . . .
By sector and instrument
2 U.S. government
3 Treasury securities
4 Agency issues and mortgages
369.8
386.0
343.2
377.2
395.3
509.5
392.4
362.0
356.8
434.8
497.3
521.7
53.7
55.1
-1.4
37.4
38.8
-1.4
79.2
79.8
-.6
87.4
87.8
-.5
161.3
162.1
-.9
186.6
186.7
-.1
87.8
88.3
-.5
86.9
87.3
-.4
106.9
108.3
-1.4
215.5
215.9
-.4
231.1
231.2
-.1
142.1
142.2
-.1
5 Private domestic nonfinancial sectors
6 Debt capital instruments
7
Tax-exempt obligations
8
Corporate bonds
9
Mortgages
10
Home mortgages
11
Multifamily residential
12
Commercial
13
Farm
316.2
199.7
28.4
21.1
150.2
112.2
9.2
21.7
7.2
348.6
211.2
30.3
17.3
163.6
120.0
7.8
23.9
11.8
264.0
192.0
30.3
26.7
135.1
96.7
8.8
20.2
9.3
289.8
158.4
21.9
22.1
114.5
75.9
4.3
24.6
9.7
234.1
152.4
50.5
18.8
83.0
56.6
1.3
20.0
5.2
322.9
227.9
44.3
15.0
168.6
111.4
9.2
45.2
2.9
304.6
179.3
21.1
26.1
132.0
92.6
4.9
25.2
9.3
275.1
137.5
22.6
18.0
96.9
59.2
3.7
23.9
10.1
249.9
139.7
41.7
10.8
87.3
55.8
4.2
21.4
5.9
219.3
166.1
59.4
26.9
79.9
58.6
-1.7
18.6
4.4
266.2
221.1
59.8
21.1
140.2
92.9
6.2
40.1
1.0
379.7
234.7
28.8
9.0
196.9
129.8
12.1
50.3
4.7
14
15
16
17
18
Other debt instruments
Consumer credit
Bank loans n.e.c
Open market paper
Other
116.5
48.8
37.4
5.2
25.1
137.5
45.4
51.2
11.1
29.7
72.0
4.9
36.7
5.7
24.8
131.5
24.1
54.7
19.2
33.4
81.6
18.3
54.4
-3.3
12.2
95.0
54.2
19.1
-1.2
23.0
125.3
28.9
45.5
12.0
38.9
137.6
19.3
63.9
26.3
28.0
110.1
19.3
70.1
6.5
14.3
53.2
17.4
38.8
-13.0
10.2
45.1
39.8
6.6
-16.3
15.0
145.0
68.6
31.6
14.0
30.9
19
20
21
22
23
24
By borrowing sector
State and local governments
Households
Farm
Nonfarm noncorporate
Corporate
316.2
19.1
169.4
14.6
32.4
80.6
348.6
20.5
176.4
21.4
34.4
96.0
264.0
20.3
117.5
14.4
33.7
78.1
289.8
9.7
120.6
16.3
39.6
103.7
234.1
36.3
86.3
9.0
29.8
72.7
322.9
35.9
163.6
3.9
62.0
57.4
304.6
9.1
139.8
20.1
39.8
95.8
275.1
10.2
101.3
12.5
39.5
111.5
249.9
29.3
87.6
9.0
34.6
89.3
219.3
43.3
86.1
9.1
24.9
56.0
266.2
50.3
128.5
-.4
51.3
36.5
379.7
21.6
198.7
8.2
72.7
78.4
25 Foreign net borrowing in United States
26 Bonds
27
Bank loans n.e.c
28 Open market paper
29
U.S. government loans
33.8
4.2
19.1
6.6
3.9
20.2
3.9
2.3
11.2
2.9
27.2
.8
11.5
10.1
4.7
27.2
5.4
3.7
13.9
4.2
15.7
6.6
-6.2
10.7
4.5
19.2
3.3
5.9
6.0
4.0
31.9
3.3
3.1
20.6
4.9
22.5
7.6
4.2
7.1
3.5
12.8
2.4
-5.1
12.5
3.0
18.6
10.8
-7.2
9.0
6.0
18.5
4.4
14.7
-4.6
4.0
19.9
2.2
-2.8
16.5
4.0
403.6
406.2
370.4
404.4
411.0
528.7
424.4
384.5
369.6
453.4
515.7
541.6
30 Total domestic plus foreign
Financial sectors
31 Total net borrowing by financial sectors
By instrument
32 U.S. government related
33
Sponsored credit agency securities
34
Mortgage pool securities
^
Loans from U.S. government
36 Private financial sectors
37 Corporate bonds
38
Mortgages
39 Bank loans n.e.c
40
Open market paper
41
Loans from Federal Home Loan Banks
By sector
42 Sponsored credit agencies
43 Mortgage pools
44 Private financial sectors
45
Commercial banks
46
Bank affiliates
47
Savings and loan associations
48 Finance companies
49 REITs
74.6
82.5
63.3
85.4
69.3
88.6
87.4
83.4
89.8
48.7
74.1
103.2
37.1
23.1
13.6
.4
37.5
7.5
.1
2.8
14.6
12.5
47.9
24.3
23.1
.6
34.6
7.8
47.4
30.5
15.0
1.9
38.0
-.8
-.5
2.2
20.9
16.2
64.9
14.9
49.5
.4
4.4
2.3
.1
3.2
-2.0
.8
68.1
1.6
66.5
49.6
32.1
15.1
2.4
33.8
-1.4
-.2
1.1
18.4
15.8
61.3
23.6
37.0
8
28.5
-1.2
.1
5.2
14.0
10.4
68.0
-2.4
70.4
68.3
5.7
62.5
20.5
17.2
.1
-2.9
13.2
-7.0
45.2
28.9
14.9
1.4
42.2
-.3
-.8
3.2
23.5
16.7
68.4
6.3
62.1
-.4
18.0
9.2
44.8
24.4
19.2
1.2
18.5
7.1
-.1
-.4
4.8
7.1
-19.7
5.8
.1
1.2
-18.0
-8.8
6.1
15.3
.1
-5.2
8.8
-12.9
35.0
19.2
.1
-.7
17.6
-1.2
23.5
13.6
37.5
1.3
7.2
13.5
18.1
-1.4
24.8
23.1
34.6
1.6
6.5
12.6
16.6
-1.3
25.6
19.2
18.5
.5
6.9
7.4
6.3
-2.2
32.4
15.0
38.0
.4
8.3
15.5
14.1
.2
15.3
49.5
4.4
1.2
1.9
-3.0
4.9
.1
1.6
66.5
20.5
.6
8.6
-5.2
17.2
.1
30.3
14.9
42.2
.2
6.9
16.8
18.5
.2
34.5
15.1
33.8
.5
9.7
14.1
9.7
.2
24.4
37.0
28.5
.7
9.7
9.1
9.5
.1
6.3
62.1
-19.7
1.7
-5.8
-15.2
.2
.1
-2.4
70.4
6.1
.8
6.1
-10.8
10.7
.1
5.7
62.5
35.0
.5
11.1
.3
23.7
.1
467.9
134.3
22.6
24.2
96.6
19.3
69.3
51.9
49.7
459.4
167.6
41.7
12.0
87.3
19.3
70.2
33.0
28.4
502.1
284.0
59.4
43.5
79.8
17.4
32.8
-22.1
7.4
589.8
299.1
59.8
40.7
140.2
39.8
16.1
-12.1
6.1
644.8
210.4
28.8
30.3
197.0
68.6
28.0
48.0
33.7
47.0
24.0
23.0
15.8
4.4
2.9
87.1
38.7
48.3
38.2
4.4
5.7
51.3
26.4
24.9
18.4
4.5
2.0
*
All sectors
50 Total net borrowing
51
U.S. government securities
52
State and local obligations
53 Corporate and foreign bonds
54
Mortgages
55
Consumer credit
56 Bank loans n.e.c
5/
Open market paper
58 Other loans
478.2
90.5
28.4
32.8
150.2
48.8
59.3
26.4
41.9
488.7
84.8
30.3
29.0
163.5
45.4
53.0
40.3
42.4
433.7
122.9
30.3
34.6
134.9
4.9
47.8
20.6
37.8
489.8
133.0
21.9
26.7
113.9
24.1
60.6
54.0
55.8
480.3
225.9
50.5
27.7
83.0
18.3
51.4
5.4
17.9
617.3
254.7
44.3
35.5
168.6
54.2
22.1
18.0
19.9
511.8
131.8
21.1
29.1
131.1
28.9
51.8
56.1
61.8
External corporate equity funds raised in United States
59 Total new share issues
60
Mutual funds
All other
61
62
Nonfinancial corporations
63
Financial corporations
64
Foreign shares purchased in United States
1.9
-.1
1.9
-.1
2.5
-.5
-3.8
.1
-3.9
-7.8
3.2
.8
22.2
5.2
17.1
12.9
2.1
2.1
-3.7
6.8
-10.6
-11.5
.9
*
35.4
18.6
16.8
11.4
4.1
1.3
69.2
32.6
36.6
28.3
4.4
3.9
10.2
8.1
2.1
.9
.5
.7
-17.7
5.6
-23.2
-23.8
1.2
-.7
23.7
13.2
10.6
7.0
3.8
-.2
Flow of Funds
1.58
A41
DIRECT A N D INDIRECT SOURCES OF FUNDS TO CREDIT MARKETS
Billions of dollars, except as noted; half-yearly data are at seasonally adjusted annual rates.
1981
Transaction category, or sector
1978
1979
1980
1981
1982
1983
1982
1983
HI
H2
HI
H2
HI
H2
1 Total funds advanced in credit markets to domestic
nonfinancial sectors
369.8
386.0
343.2
377.2
395.3
509.5
392.4
362.0
356.8
434.8
497.3
521.7
By public agencies and foreign
? Total net advances
3
U.S. government securities
4 Residential mortgages
5 FHLB advances to savings and loans
6 Other loans and securities
102.3
36.1
25.7
12.5
28.0
75.2
-6.3
35.8
9.2
36.5
97.0
15.7
31.7
7.1
42.4
97.4
17.2
23.4
16.2
40.6
109.3
17.9
61.1
.8
29.5
114.8
27.7
75.9
-7.0
18.3
113.8
31.2
21.9
16.7
44.1
81.0
3.1
25.0
15.8
37.1
107.9
17.7
48.1
10.4
31.7
110.8
18.2
74.0
-8.8
27.4
129.5
51.2
80.7
-12.9
10.4
100.0
4.2
71.0
-1.2
26.1
17.1
40.3
7.0
38.0
19.0
53.0
7.7
-4.6
23.7
45.6
4.5
23.2
24.1
48.2
9.2
16.0
16.7
65.3
9.8
17.6
9.8
68.9
10.9
25.2
27.9
47.2
2.4
36.4
20.3
49.2
16.0
-4.4
14.2
62.5
.1
31.1
19.1
68.1
19.5
4.1
8.2
69.1
12.1
40.1
11.3
68.7
9.7
10.3
37.1
33.8
47.9
20.2
44.8
27.2
47.4
27.2
64.9
15.7
68.1
19.2
45.2
31.9
49.6
22.5
61.3
12.8
68.4
18.6
68.0
18.5
68.3
19.9
338.4
54.3
28.4
23.4
95.6
149.3
12.5
379.0
91.1
30.3
18.5
91.9
156.3
9.2
318.2
107.2
30.3
19.3
73.7
94.8
7.1
354.4
115.9
21.9
19.4
56.7
156.9
16.2
366.6
207.9
50.5
15.4
-3.3
96.8
.8
482.0
227.0
44.3
12.1
44.6
146.9
-7.0
355.7
100.6
21.1
20.9
75.5
154.3
16.7
353.1
131.1
22.6
17.9
37.9
159.5
15.8
323.0
149.9
41.7
-1.7
11.7
131.7
10.4
411.0
265.8
59.4
32.4
-17.2
62.0
-8.8
454.2
247.9
59.8
19.9
18.3
95.3
-12.9
509.8
206.2
28.8
4.4
70.9
198.4
-1.2
Commercial banking
Savings institutions
Insurance and pension funds
Other finance
302.3
129.0
72.8
75.0
25.5
294.7
123.1
56.7
66.4
48.5
262.3
101.1
54.9
74.4
32.0
305.2
103.6
27.2
79.3
95.2
271.2
108.5
30.6
94.2
37.9
368.5
135.3
128.6
102.1
2.6
317.3
99.6
41.5
75.3
101.0
293.1
107.6
12.8
83.4
89.4
272.8
109.7
29.5
95.4
38.1
268.9
107.1
31.0
93.0
37.8
347.5
127.6
130.6
107.4
-18.0
389.5
143.0
126.6
96.8
23.1
75 Sources of funds
76
Private domestic deposits and RPs
27 Credit market borrowing
302.3
141.0
37.5
294.7
142.0
34.6
262.3
168.6
18.5
305.2
211.7
38.0
271.2
173.4
4.4
368.5
200.3
20.5
317.3
213.8
42.2
293.1
209.6
33.8
272.8
163.4
28.5
268.9
182.7
-19.7
347.5
211.6
6.1
389.5
189.0
35.0
78
29
30
31
32
123.8
6.5
6.8
62.2
48.4
118.1
27.6
.4
49.1
41.0
75.2
-21.7
-2.6
65.4
34.0
55.5
-8.7
-1.1
73.2
-7.9
93.5
-27.7
6.1
85.9
29.2
147.7
17.2
-6.0
88.0
48.4
61.3
-8.7
6.5
62.7
.8
49.8
-8.7
-8.7
83.8
-16.7
80.8
-30.1
-2.1
85.4
27.6
105.9
-25.4
14.1
86.4
30.7
129.8
-18.9
8.4
93.1
47.2
165.5
53.4
-20.4
82.9
49.6
34
35
36
37
Private domestic nonfinancial investors
Direct lending in credit markets
U.S. government securities
State and local obligations
Corporate and foreign bonds
Open market paper
38
Other
73.6
36.3
3.6
-1.8
15.6
19.9
118.9
61.4
9.9
5.7
12.1
29.8
74.4
38.3
7.0
.6
-4.3
32.9
87.2
47.4
9.6
-8.9
3.7
35.4
99.7
58.1
30.9
-9.4
-2.0
22.1
134.0
89.8
31.9
-6.1
7.7
10.8
80.6
37.2
9.5
-5.5
-3.3
42.7
93.8
57.6
9.7
-12.4
10.7
28.2
78.7
43.1
28.4
-26.3
6.7
26.8
122.4
72.7
33.4
7.4
-10.7
19.6
112.8
88.0
47.7
-19.1
-11.2
7.4
155.3
91.5
16.1
6.8
26.6
14.2
39 Deposits and currency
40 Currency
41 Checkable deposits
47
Small time and savings accounts
43
Money market fund shares
44
Large time deposits
45
Security RPs
46 Deposits in foreign countries
152.2
9.3
16.2
65.9
6.9
44.4
7.5
2.0
151.4
7.9
18.7
59.2
34.4
23.0
6.6
1.5
180.0
10.3
5.0
83.1
29.2
44.7
6.5
1.1
221.7
9.5
18.1
47.2
107.5
36.4
2.5
.5
179.4
8.4
13.0
137.0
24.7
-5.2
3.8
-2.4
217.5
13.9
22.5
216.6
-44.1
-2.3
7.5
3.3
222.6
8.0
29.8
30.7
104.1
41.6
7.7
.8
220.7
11.0
6.5
63.6
110.8
31.2
-2.6
.2
166.2
4.5
6.7
95.1
39.4
21.2
1.1
-1.8
192.1
12.3
19.1
178.6
10.0
-31.6
6.6
-2.9
231.9
14.1
53.1
295.8
-84.0
-64.4
11.0
6.1
203.2
13.8
-8.0
137.4
-4.2
59.8
4.0
.4
47 Total of credit market instruments, deposits and
currency
225.8
270.3
254.4
308.9
279.1
351.6
303.3
314.5
244.9
314.5
344.7
358.5
25.3
89.3
44.6
18.5
77.7
23.0
26.2
82.4
1.5
24.1
86.1
7.3
26.6
74.0
-10.2
21.7
76.5
42.5
26.8
89.2
27.8
21.1
83.0
-13.1
29.2
84.4
1.0
24.4
65.4
-21.3
25.1
76.5
21.2
18.5
76.4
63.7
Total advanced, by sector
U.S. government
Sponsored credit agencies
9
Monetary authorities
10 Foreign
7
8
11
12
N
14
15
16
17
18
19
Agency and foreign borrowing not in line 1
Sponsored credit agencies and mortgage pools
Foreign
Private domestic funds advanced
Total net advances
U.S. government securities
State and local obligations
Corporate and foreign bonds
Residential mortgages
Other mortgages and loans
LESS: Federal Home Loan Bank advances
Private financial intermediation
20 Credit market funds advanced by private finan71
7?
73
24
Other sources
Foreign funds
Treasury balances
Insurance and pension reserves
Other, net
33
48
Public holdings as percent of total
Private financial intermediation (in percent)
Total foreign funds
49
50
MEMO: Corporate equities not included above
51 Total net issues
5?
Mutual fund shares
53 Other equities
54 Acquisitions by financial institutions
55 Other net purchases
1.9
-3.8
22.2
-3.7
35.4
69.2
10.2
-17.7
23.7
47.0
87.1
51.3
-.1
1.9
.1
-3.9
5.2
17.1
6.8
-10.6
18.6
16.8
32.6
36.6
8.1
2.1
5.6
-23.2
13.2
10.6
24.0
23.0
38.7
48.3
26.4
24.9
4.5
-2.7
9.7
-13.5
16.8
5.4
22.1
-25.9
27.9
7.5
54.4
14.8
25.3
-15.1
18.9
-36.6
19.3
4.4
36.4
10.6
68.4
18.6
40.3
NOTES BY LINE NUMBER.
1.
2.
6.
11.
13.
18.
26.
27.
29.
30.
31.
Line 1 of table 1.58.
Sum of lines 3-6 or 7-10.
Includes farm and commercial mortgages.
Credit market funds raised by federally sponsored credit agencies, and net
issues of federally related mortgage pool securities.
Line 1 less line 2 plus line 11 and 12. Also line 20 less line 27 plus line 33. Also
sum of lines 28 and 47 less lines 40 and 46.
Includes farm and commercial mortgages.
Line 39 less lines 40 and 46.
Excludes equity issues and investment company shares. Includes line 19.
Foreign deposits at commercial banks, bank borrowings from foreign
branches, and liabilities of foreign banking agencies to foreign affiliates.
Demand deposits at commercial banks.
Excludes net investment of these reserves in corporate equities.
11.0
32. Mainly retained earnings and net miscellaneous liabilities.
33. Line 12 less line 20 plus line 27.
34-38. Lines 14-18 less amounts acquired by private finance. Line 38 includes
mortgages.
40. Mainly an offset to line 9.
47. Lines 33 plus 39, or line 13 less line 28 plus 40 and 46.
48. Line 2/line 1.
49. Line 20/line 13.
50. Sum of lines 10 and 29.
51. 53. Includes issues by financial institutions.
NOTE. Full statements for sectors and transaction types in flows and in amounts
outstanding may be obtained from Flow of Funds Section, Division of Research
and Statistics, Board of Governors of the Federal Reserve System, Washington,
D.C. 20551.
A42
2.10
Domestic Nonfinancial Statistics • May 1984
NONFINANCIAL BUSINESS ACTIVITY
Selected Measures
1967 = 100; monthly and quarterly data are seasonally adjusted. Exceptions noted.
1983
Measure
1981
1982
1984
1983
Aug.
Sept.
Oct.
Nov.
Dec.
Jan/
Feb/
Mar/
Apr.
1 Industrial production1
151.0
138.6
147.6
151.8
153.8
155.0
155.3
156.2
158.5
160.1
160.9
163.1
Market groupings
Products, total
Final, total
Consumer goods
Equipment
Intermediate
Materials
150.6
149.5
147.9
151.5
154.4
151.6
141.8
141.5
142.6
139.8
143.3
133.7
149.2
147.1
151.7
140.8
156.6
145.2
153.2
150.7
156.3
143.1
162.2
149.7
154.9
152.1
157.3
144.9
165.4
152.2
155.6
152.7
156.9
147.0
166.5
154.0
155.8
153.2
156.1
149.1
165.5
154.5
157.4
155.2
157.7
151.8
165.4
154.5
159.7
157.5
159.5
154.9
167.8
156.6
160.5
158.2
159.6
156.3
169.1
159.6
161.2
158.8
159.9
157.2
169.9
160.6
163.2
160.7
161.6
159.5
172.3
162.9
150.4
137.6
148.2
152.8
155.1
156.2
156.4
156.8
159.5
161.6
162.4
164.9
79.4
80.7
71.1
70.1
75.2
75.2
77.3
77.4
78.4
78.6
78.9
79.5
78.8
79.6
78.9
79.6
80.1
80.6
81.0
82.0
81.2
82.3
82.3
83.3
2
3
4
5
6
7
Industry groupings
8 Manufacturing
Capacity utilization (percent)1'2
9 Manufacturing
10 Industrial materials industries
11 Construction contracts (1977 = 100)3
111.0
111.0
138.0
154.0
143.0
139.0
145.0
134.0
150.0
150.0
n.a.
n.a.
12
13
14
15
16
17
18
19
20
21
Nonagricultural employment, total 4
Goods-producing, total
Manufacturing, total
Manufacturing, production-worker . . .
Service-producing
Personal income, total
Wages and salary disbursements
Manufacturing
Disposable personal income3
Retail sales6
138.5
109.4
103.7
98.0
154.4
386.5
349.7
287.3
373.7
330.6
136.2
102.6
96.9
89.4
154.6
409.3
367.2
286.2
397.3
326.0
136.8
101.5
96.0
88.7
156.1
453.3
389.8
300.4
426.3
373.(K
136.4
102.2
96.6
89.5
155.1
437.5
393.6
304.6
430.1
375.5r
138.1
102.7
97.0
89.9
157.5
441.5
396.2
308.2
434.1
380.3'
138.4
103.7
98.0
91.2
157.5
446.5
400.6
310.2
438.8
385.6'
138.8
104.3
98.6
91.9
157.8
450.0
401.7
312.8
442.1
389. ¥
139.2
104.7
99.1
92.5
158.1
453.7
404.1
314.3
446.2
391.4'
139.7
105.6
99.7
93.1
158.4
461.4
409.5
320.4
454.0
407.3
140.4
106.3
100.3
93.7
159.0
464.6
411.5
323.3
457.2
403.0
140.6
106.3
100.6
94.0
159.4
466.7
412.8
324.6
459.5
395.0
141.2
107.1
101.1
94.7
159.9
i
22
23
Prices7
Consumer
Producer finished goods
272.4
269.8
289.1
280.7
298.4
285.2
300.3
286.1
301.8
285.1
302.6
287.9
303.1
286.8
303.5
287.1
305.2
289.4
306.6
290.6
307.3
291.7
6. Based on Bureau of Census data published in Survey of Current Business.
1. Data without seasonal adjustment, as published in Monthly Labor Review.
Seasonally adjusted data for changes in the price indexes may be obtained from
the Bureau of Labor Statistics, U.S. Department of Labor.
1. The capacity utilization series has been revised back to January 1967.
2. Ratios of indexes of production to indexes of capacity. Based on data from
Federal Reserve, McGraw-Hill Economics Department, Department of Commerce, and other sources.
3. Index of dollar value of total construction contracts, including residential,
nonresidential and heavy engineering, from McGraw-Hill Information Systems
Company, F. W. Dodge Division.
4. Based on data in Employment and Earnings (U.S. Department of Labor).
Series covers employees only, excluding personnel in the Armed Forces.
5. Based on data in Survey of Current Business (U.S. Department of Commerce).
2.11
n a.
NOTE. Basic data (not index numbers) for series mentioned in notes 4, 5, and 6,
and indexes for series mentioned in notes 3 and 7 may also be found in the Survey
of Current Business.
Figures for industrial production for the last two months are preliminary and
estimated, respectively.
OUTPUT, CAPACITY, AND CAPACITY UTILIZATION
Seasonally adjusted
1984
1983
Q2
Q3
Q4
Ql'
1983
Q2
Q3
1984
Q4
Ql
Capacity (percent of 1967 output)
Output (1967 = 100)
1983
Q2
Q3
1984
Q4
Ql'
Utilization rate (percent)
1 Total industry
2 Mining
3 Utilities
144.5
112.3
169.6
151.8
116.1
178.2
155.5
121.0
178.4
159.8
124.3
178.6
195.5
165.3
209.8
196.4
165.4
211.1
197.3
165.5
212.4
198.3
165.7
213.8
73.9
67.9
80.8
77.3
70.2
84.4
78.8
73.1
84.<y
80.6
75.0
83.5
4 Manufacturing
5 Primary processing
6 Advanced processing
145.2
145.2
145.1
152.8
152.8
152.8
156.5
156.4
156.1
161.2
160.7
161.8
196.6
194.8
197.6
197.5
195.3
198.6
198.4
195.8
199.7
199.5
196.4
201.0
73.8
74.6
73.5
77.4
78.3
76.9
78.9
79.9
78.2
80.8
81.6
80.3
7 Materials
141.7
149.9
154.3
158.9
192.9
193.4
194.0
194.7
73.5
77.5
79.6
81.6
8 Durable goods
9 Metal materials
10 Nondurable goods
11 Textile, paper, and chemical
12
Paper
13
Chemical
134.7
84.9
171.7
179.6
153.4
219.4
144.2
89.3
179.1
188.0
162.8
227.8
150.3
93.8
183.5
193.2
167.4
235.0
157.6
97.3
184.1
193.9
166.7
237.5
195.6
139.9
218.8
230.7
166.1
296.6
196.0
139.8
219.6
231.6
166.9
298.3
196.5
139.6
220.6
232.7
167.7
300.1
197.1
139.1
221.8
234.2
168.5
302.3
68.9
60.7
78.5
77.9
92.3
74.0
73.6
63.9
81.5
81.2
97.5
76.4
76.5
67.2
83.2r
83 ,<y
99.8r
78. y
80.0
70.0
83.0
82.8
98.9
78.5
14 Energy materials
121.5
127.4
127.8
131.0
154.3
154.7
155.3
155.8
78.7
82.3
82.3'
84.1
Labor Market
2.11
A43
Continued
Previous cycle1
Latest cycle 2
1983
Low
Apr.
1984
1983
Series
High
Low
High
Aug.
Sept.
Nov.
Oct.
Dec.
Jan/
Feb/
Mar/
Apr.
Capacity utilization rate (percent)
88.4
91.8
94.9
71.1
86.0
82.0
87.3
88.5
86.7
76.5
84.0
83.8
73.1
67.5
80.9
77.3
70.2
85.0
78.2
70.8
84.8
78.7
71.5
83.3
78.7
73.2
83.0
79.1
74.7
85.7
80.1
75.4
84.8
80.8
75.1
82.6
81.0
74.5
83.2
81.9
74.3
83.2
18 Manufacturing
87.9
69.0
87.5
75.5
72.9
77.3
78.4
78.9
78.8
78.9
80.1
81.0
81.2
82.3
19
20
93.7
85.5
68.2
69.4
91.4
85.9
72.6
77.0
73.4
72.5
78.1
76.9
79.7
77.8
80.4
77.9
80.0
78.0
79.2
78.6
80.5
79.9
82.0
80.5
82.3
80.7
83.2
81.7
92.6
91.4
97.8
69.3
63.5
68.0
88.9
88.4
95.4
74.2
68.4
59.4
72.5
67.7
59.9
77.4
73.6
64.0
78.6
75.2
65.5
79.5
76.1
68.0
79.6
76.5
66.8
79.6
77.0
66.8
80.6
78.5
67.3
82.0
80.4
70.9
82.3
80.9
71.7
83.3
82.2
73.3
15 Total industry
16
17 Utilities
Primary processing
Advanced processing....
71 Materials
??
Durable goods
23
Metal materials
94.4
67.4
91.7
77.5
77.2
81.1
82.9
84.1
83.8
81.6
81.9
83.2
83.9
84.7
76
27
Nondurable goods
Textile, paper, and
chemical
Paper
Chemical
95.1
99.4
95.5
65.4
72.4
64.2
92.3
97.9
91.3
75.5
89.8
70.7
76.4
91.0
72.6
80.5
96.9
75.5
82.6
99.0
77.8
84.1
99.4
79.7
83.7
101.3
79.0
81.2
98.8
76.2
81.5
99.3
76.7
83.1
99.0
79.0
83.7
98.3
79.8
84.4
n.a.
n.a.
28
Energy materials
94.5
84.4
88.7
84.4
78.9
82.8
81.6
81.4
81.8
83.6
84.4
84.2
83.7
83.8
24
25
1. Monthly high 1973; monthly low 1975.
2.12
2. Preliminary; monthly highs December 1978 through January 1980; monthly
lows July through October 1980.
LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT
Thousands of persons; monthly data are seasonally adjusted. Exceptions noted.
1984
1983
Category
1981
1982
1983
Sept.
Oct.
Nov.
Dec.
Jan.
Feb/
Mar/
Apr.
HOUSEHOLD SURVEY DATA
1 Noninstitutional population1
172,272
174,450
176,414
176,811
176,990
177,151
177,325
177,733
177,882
178,033
178,185
2 Labor force (including Armed Forces) 1
3 Civilian labor force
110,812
108,670
112,383
110,204
113,749
111,550
114,438
112,229
114,077
111,866
114,235
112,035
114,340
112,136
114,415
112,215
114,8%
112,693
115,121
112,912
115,461
113,245
97,030
3,368
96,125
3,401
97,450
3,383
98,568
3,308
98,730
3,240
99,349
3,257
99,585
3,356
99,918
3,271
100,4%
3,395
100,859
3,281
101,009
3,393
8,273
7.6
61,460
10,678
9.7
62,067
10,717
9.6
62,665
10,353
9.2
62,373
9,8%
8.8
62,913
9,429
8.4
62,916
9,195
8.2
62,985
9,026
8.0
63,318
8,801
7.8
62,986
8,772
7.8
62,912
8,843
7.8
62,724
91,156
89,596
89,986
90,851
91,084
91,355
91,599
91,930
92,357
92,506
92,913
20,170
1,132
4,176
5,157
20,551
5,301
20,547
16,024
18,853
1,143
3,911
5,081
20,401
5,340
19,064
15,803
18,678
1,021
3,949
4,943
20,508
5,456
19,685
15,747
18,871
1,026
4,038
5,031
20,612
5,499
19,913
15,861
19,064
1,044
4,060
5;019
20,666
5,503
19,956
15,775
19,172
1,045
4,094
5,019
20,718
5,515
20,016
15,776
19,280
1,047
4,088
5,015
20,781
5,525
20,093
15,770
19,389
1,051
4,177
5,057
20,860
5,553
20,101
15,742
19,499
1,053
4,233
5,063
20,918
5,570
20,249
15,773
19,560
1,052
4,170
5,073
20,975
5,580
20,339
15,756
19,661
1,053
4,244
5,085
20,990
5,599
20,516
15,757
Nonagricultural industries 2
Agriculture
Unemployment
6
Number
7
Rate (percent of civilian labor force) . . .
8 Not in labor force
4
5
ESTABLISHMENT SURVEY DATA
9 Nonagricultural payroll employment3
10
11
1?
13
14
15
16
17
Manufacturing
Mining
Contract construction
Transportation and public utilities
Finance
Service
Government
1. Persons 16 years of age and over. Monthly figures, which are based on
sample data, relate to the calendar week that contains the 12th day; annual data
are averages of monthly figures. By definition, seasonality does not exist in
population figures. Based on data from Employment and Earnings (U.S. Department of Labor).
2. Includes self-employed, unpaid family, and domestic service workers.
3. Data include all full- and part-time employees who worked during, or
received pay for, the pay period that includes the 12th day of the month, and
exclude proprietors, self-employed persons, domestic servants, unpaid family
workers, and members of the Armed Forces. Data are adjusted to the March 1983
benchmark and only seasonally adjusted data are available at this time. Based on
data from Employment and Earnings (U.S. Department of Labor).
A44
Domestic Nonfinancial Statistics • May 1984
2.13 INDUSTRIAL PRODUCTION
Indexes and Gross Value
Monthly data are seasonally adjusted
Grouping
1967
proportion
1983
1983
avg.
Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
Jan/
Feb.
Index (1967 = 100)
MAJOR MARKET
1 Total index
2 Products
3
Final products
4
Consumer goods
Equipment
5
Intermediate products
6
7 Materials
8
9
10
11
12
13
14
15
16
17
Consumer goods
Durable consumer goods
Automotive products
Autos and utility vehicles
Autos
Auto parts and allied goods
Home goods
Appliances, AJC, and TV
Appliances and TV
Carpeting and furniture
Miscellaneous home goods
18 Nondurable consumer goods
19 Clothing
20 Consumer staples
21
Consumer foods and tobacco
22
Nonfood staples
23
Consumer chemical products
24
Consumer paper products
25
Consumer energy products
26
Residential utilities
27
28
29
30
31
Equipment
Business
Industrial
Building and mining
Manufacturing
Power
100.00
147.6
142.6
144.4
146.4
149.7
151.8
153.8
155.0
155.3
156.2
158.5
160.1
60.71
47.82
27.68
20.14
12.89
39.29
149.2
147.1
151.7
140.8
156.6
145.2
144.5
142.8
147.7
136.2
150.8
139.7
146.2
144.5
150.4
136.5
152.2
141.7
148.1
146.4
152.4
138.2
154.5
143.7
150.9
149.0
154.8
141.0
158.1
147.8
153.2
150.7
156.3
143.1
154.9
152.1
157.4
144.9
165.3
152.3
155.6
152.7
156.9
147.0
166.5
154.0
155.8
153.2
156.1
149.1
165.5
154.5
157.4
155.2
157.7
151.8
165.4
154.5
159.7
157.5
159.5
154.9
167.8
156.6
160.5
158.2
159.6
156.3
169.1
159.6
7.89
2.83
2.03
1.90
147.5
158.2
134.0
117.4
219.6
141.4
116.4
120.1
178.1
139.9
140.5
144.9
117.8
102.7
213.6
138.1
106.1
109.7
180.5
137.9
145.5
152.2
124.9
107.4
221.5
141.8
149.2
160.0
135.4
118.3
157.4
172.9
153.1
135.0
223.1
148.7
125.2
129.7
186.3
145.9
156.7
171.3
149.2
129.6
227.4
148.4
129.2
133.3
185.5
143.6
155.9
171.5
149.2
129.4
143.2
114.4
118.4
185.6
141.3
152.9
167.0
145.4
129.8
221.9
144.9
116.2
119.7
187.3
143.0
147.2
127.0
131.3
182.7
143.4
158.6
178.4
157.8
137.4
230.7
147.5
126.3
130.2
184.0
143.9
163.4
184.5
163.3
140.7
238.4
151.5
136.4
140.0
183.1
146.7
162.7
182.3
162.9
141.2
231.6
151.6
135.1
138.6
178.7
149.4
153.4
150.5
152.3
153.6
155.6
157.1
157.5
157.1
156.1
157.3
157.9
158.3
161.1
162.8
153.2
174.0
227.8
168.0
168.0
156.6
177.2
233.8
132.6
153.2
173.2
156.3
239.7
137.4
155.7
179.9
154.9
183.2
241.5
138.2
157.7
167.2
156.0
180.3
238.7
137.6
153.0
174.5
165.4
154.5
178.1
232.4
136.6
154.1
175.8
166.0
153.4
174.3
164.3
155.9
174.1
229.0
130.1
151.2
170.5
166.1
166.5
156.5
178.2
231.6
138.8
153.4
1.45
1637
153.5
175.4
231.0
132.7
150.9
173.4
180.0
166.9
156.8
178.7
231.9
140.3
153.3
172.8
12.63
6.77
1.44
3.85
1.47
153.3
120.4
159.3
107.1
117.1
147.7
114.5
146.2
102.5
115.0
150.2
116.3
148.7
105.0
114.1
153.3
119.9
154.4
108.9
114.6
156.6
124.3
159.2
113.3
119.0
161.3
126.6
166.9
114.6
118.5
164.1
175.8
114.3
119.4
167.3
130.8
185.3
115.1
118.4
170.7
133.7
185.1
119.7
120.0
172.2
134.9
181.9
121.6
123.8
205.1
292.5
103.2
73.5
209.6
298.9
106.0
73.5
213.3
303.2
215.3
305.7
97.6
71.0
201.3
288.1
100.0
70.9
110.1
111.2
73.6
75.7
129.5
.80
5.06
1.40
1.33
1.07
2.59
19.79
4.29
15.50
8.33
7.17
2.63
1.92
2.62
150.9
172.9
225.5
129.2
152.2
175.5
146.9
113.5
141.8
101.7
116.6
112.8
116.1
181.9
140.9
128.6
222.6
162.2
149.7
154.2
168.1
147.0
132.0
221.8
146.4
121.2
125.0
187.5
143.2
181.6
182.8
158.8
125.6
160.8
115.0
118.8
128.6
155.4
178.3
229.9
137.2
156.5
185.2
5.86
3.26
1.93
.67
191.3
273.2
95.2
69.5
185.4
264.3
92.0
70.2
186.1
265.0
92.6
71.3
189.5
270.9
93.2
70.4
191.9
276.0
92.0
70.8
194.0
277.4
95.9
70.8
36 Defense and space
7.51
119.9
118.2
117.6
118.0
120.4
120.2
121.8
122.9
124.0
125.7
128.3
Intermediate products
37 Construction supplies
38 Business supplies
39 Commercial energy products
6.42
6.47
1.14
142.5
170.7
184.3
136.4
165.2
183.3
138.4
166.0
183.1
142.1
166.8
181.4
145.8
170.4
185.2
149.0
175.3
186.9
151.1
179.3
190.2
152.3
180.6
187.0
151.6
179.4
187.6
151.5
179.3
188.0
155.5
157.1
180.1
181.0
192.1
191.6
20.35
4.58
5.44
10.34
5.57
138.6
113.6
176.4
129.9
90.2
132.4
106.5
167.2
125.4
87.8
134.7
108.5
170.6
127.5
89.3
137.0
109.5
175.8
128.7
89.6
141.1
115.6
144.2
119.9
183.6
134.2
93.1
147.2
123.1
186.0
149.4
124.9
188.3
139.8
98.0
150.3
125.0
192.5
139.3
97.1
151.3
127.9
193.4
139.5
96.9
154.6
131.6
198.2
141.8
97.7
158.5
133.1
204.0
145.8
102.7
32
33
34
35
Commercial transit, farm
Commercial
Transit
Farm
Materials
40 Durable goods materials
41
Durable consumer parts
42
Equipment parts
43
Durable materials n.e.c
44
Basic metal materials
45 Nondurable goods materials
46 Textile, paper, and chemical
materials
47
Textile materials
48
Paper materials
49
Chemical materials
50 Containers, nondurable
51
Nondurable materials n.e.c
52 Energy materials
53 Primary energy
54 Converted fuel materials
55
56
57
58
Supplementary groups
Home goods and clothing
Energy, total
Products
Materials
180.8
131.5
90.8
196.7
228.2
281.2
137.4
94.5
10.47
174.5
168.7
172.1
174.3
177.0
178.0
183.4
185.3
184.8
180.3
181.2
184.6
7.62
1.85
182.6
116.2
158.2
221.7
167.9
130.5
175.9
110.6
150.8
214.9
163.2
129.1
180.2
182.8
186.1
166.1
225.9
166.5
131.3
186.4
121.5
161.8
225.1
170.6
133.0
192.0
123.1
165.4
233.1
179.1
132.6
195.4
124.0
166.3
238.7
175.9
131.9
194.7
121.9
169.8
237.0
176.6
130.6
189.6
121.3
166.0
229.3
173.0
129.5
190.5
119.9
167.0
231.3
173.5
130.5
194.6
119.9
166.9
238.9
173.0
135.1
127.7
115.4
142.7
128.0
126.4
112.8
142.8
126.3
114.1
141.2
127.1
115.5
141.1
130.0
117.6
145.1
131.3
119.3
145.8
131.2
113.9
145.2
133.3
139.4
165.2
135.2
139.0
167.5
126.4
135.5
137.7
163.3
126.3
135.9
138.5
164.3
127.1
137.6
141.1
140.1
141.6
165.1
131.3
140.5
141.5
164.9
131.2
1.62
4.15
1.70
1.14
114.6
154.4
219.6
164.3
129.7
116.0
155.0
223.6
121.8
112.6
129.9
8.48
4.65
3.82
124.8
114.7
137.0
121.6
113.9
131.0
121.1
9.35
12.23
3.76
8.48
129.9
135.9
161.0
124.8
126.3
133.9
161.7
121.6
129.2
133.8
162.4
130.2
133.6
160.4
121.1
121.8
113.8
129.9
132.9
119.0
161.1
132.3
138.5
162.9
127.7
128.0
166.0
130.0
121.8
142.7
Mar.?
Apr.
Output
2.13
A45
Continued
Grouping
SIC
code
1967
proportion
1984
1983
1983
avg.
Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
Jan/
Feb.
Mar.P
Apr/
Index (1967 = 100)
MAJOR INDUSTRY
12.05
6.36
5.69
3.88
87.95
35.97
51.98
142.9
116.6
172.4
196.0
148.2
168.1
134.5
138.9
111.6
169.3
192.7
143.1
163.3
129.1
139.7
112.8
169.7
192.9
145.1
165.4
131.0
139.6
112.6
169.8
192.0
147.4
167.8
133.2
143.8
115.0
176.0
200.9
150.6
170.6
136.8
146.0
116.1
179.3
205.4
152.8
172.9
138.8
146.5
117.1
179.3
204.5
155.1
174.6
141.6
145.8
118.3
176.5
200.7
156.2
175.6
142.8
147.2
121.1
176.3
200.2
156.4
174.8
143.6
151.5
123.7
182.5
208.0
156.8
173.9
145.0
151.4
124.8
181.0
206.8
159.5
175.2
148.6
149.1
124.5
176.6
200.1
161.6
177.4
150.6
149.4
123.5
178.3
202.2
162.4
177.8
151.7
149.5
123.3
178.7
202.8
164.9
179.9
154.4
10
11.12
13
14
.51
.69
4.40
.75
80.9
136.3
116.6
122.8
79.8
125.3
112.2
117.7
84.4
125.6
112.5
122.5
82.9
124.6
112.6
121.7
82.5
139.9
113.9
121.2
80.9
141.2
114.7
125.0
78.7
140.5
116.3
126.5
81.0
142.7
117.3
127.4
84.6
144.8
119.8
132.2
82.3
145.2
123.4
133.9
89.4
151.5
123.1
134.8
97.4
163.2
120.1
133.2
100.6
164.0
117.6
136.3
159.0
117.9
1 Mining and utilities
2
Mining
3
Utilities
Electric
4
5 Manufacturing
Nondurable
6
Durable
7
8
9
10
11
Mining
Metal
Coal
Oil and gas extraction
Stone and earth minerals
12
13
14
15
16
Nondurable manufactures
Foods
Tobacco products
Textile mill products
Apparel products
Paper and products
20
21
22
23
26
8.75
.67
2.68
3.31
3.21
156.4
112.1
140.8
153.7
114.8
136.6
155.6
112.9
139.6
157.7
120.0
141.8
159.9
112.9
146.7
159.3
117.1
147.4
158.2
112.7
148.7
157.6
109.1
148.7
157.1
109.5
145.8
157.7
112.3
145.0
159.4
116.4
143.9
160.0
110.9
142.3
142.9
164.3
157.0
161.5
163.0
165.1
168.6
170.4
171.5
172.1
170.1
172.3
176.2
174.9
176.0
17
18
19
20
21
Printing and publishing
Chemicals and products
Petroleum products
Rubber and plastic products
Leather and products
27
28
29
30
31
4.72
7.74
1.79
2.24
.86
152.5
215.0
120.3
291.9
61.9
145.7
208.5
120.6
283.0
58.7
145.2
211.0
123.8
288.0
59.6
147.4
214.7
123.0
293.8
60.1
152.0
218.3
124.3
296.1
62.3
157.8
220.3
123.2
306.9
64.4
161.7
224.1
125.1
310.9
64.2
162.7
228.4
123.6
310.8
64.0
162.0
225.6
125.4
309.1
63.2
161.7
221.1
114.4
314.4
66.0
163.4
221.5
118.8
317.2
61.4
164.8
226.1
127.6
318.5
63.9
165.1
227.0
127.8
323.4
63.9
167.0
22
23
24
25
Durable manufactures
Ordnance, private and government
Lumber and products
Furniture and fixtures
Clay, glass, stone products
19.91
24
25
32
3.64
1.64
1.37
2.74
95.4
137.2
170.5
143.4
93.2
132.1
167.7
138.3
92.6
135.8
169.6
139.2
93.3
137.4
173.1
141.7
95.2
141.3
175.2
145.8
96.8
141.6
179.0
147.9
98.0
142.3
180.7
151.7
98.8
141.7
181.0
151.9
99.3
141.0
177.5
152.7
99.8
143.8
177.9
153.8
99.7
146.0
183.8
157.8
99.6
146.0
185.6
160.4
100.4
147.7
186.0
160.7
102.0
26
27
28
29
30
Primary metals
Iron and steel
Fabricated metal products
Nonelectrical machinery
Electrical machinery
33
331.2
34
35
36
6.57
4.21
5.93
9.15
8.05
85.4
71.5
120.2
150.6
185.5
83.1
68.5
115.3
143.1
177.2
84.9
69.5
115.5
146.1
180.1
84.8
69.7
118.5
149.5
182.4
85.5
71.8
122.7
154.2
188.3
87.5
75.1
126.0
157.3
189.2
90.6
78.2
127.4
158.3
195.8
95.3
84.3
26.9
159.2
198.4
92.2
79.2
128.5
161.8
200.1
90.4
74.1
129.2
164.3
201.5
93.2
80.7
131.7
169.5
206.2
98.4
86.0
132.6
171.5
209.9
97.7
84.5
134.9
173.1
211.8
137.5
176.9
217.8
37
371
9.27
4.50
117.8
137.1
111.4
125.5
113.8
130.4
116.6
136.2
119.7
142.3
121.1
144.3
124.7
150.9
125.5
150.9
127.3
152.9
130.8
158.9
134.9
166.3
135.6
165.1
136.0
166.1
135.4
163.0
372-9
38
39
4.77
2.11
1.51
99.6
158.7
146.2
98.1
155.1
145.0
98.1
156.0
149.0
98.1
156.1
151.0
98.5
159.3
153.7
99.2
161.6
153.1
100.0
163.6
151.7
101.6
163.0
149.1
103.2
163.0
148.9
104.3
164.6
149.3
105.3
167.8
151.1
107.7
168.6
152.0
107.7
170.2
152.9
109.5
173.5
155.9
31 Transportation equipment
32
Motor vehicles and parts
33 Aerospace and miscellaneous
transportation equipment...
34 Instruments
35 Miscellaneous manufactures
130.9
99.8
Gross value (billions of 1972 dollars, annual rates)
MAJOR MARKET
36 Products, total
507.4
612.6
592.6
601.8
610.5
620.5
626.6
637.0
637.8
638.4
645.4
655.1
655.5
659.7
667.1
37 Final
38 Consumer goods .
39 Equipment
40 Intermediate
390.9
277.5
113.4
116.6
472.6
328.7
144.0
140.0
457.7
318.8
138.9
134.9
465.6
325.6
140.0
136.2
471.8
330.4
141.4
138.7
478.2
333.7
144.5
142.3
481.8
336.7
145.1
144.8
489.9
341.6
148.4
147.1
490.7
340.2
150.5
147.1
490.8
338.3
152.5
147.6
497.8
341.9
155.9
147.6
505.3
345.3
160.0
149.8
503.5
343.6
159.9
152.0
508.1
346.7
161.4
151.6
512.8
348.9
163.9
154.3
1. 1972 dollar value.
A46
2.14
D o m e s t i c Nonfinancial Statistics •
May
1984
HOUSING AND CONSTRUCTION
Monthly figures are at seasonally adjusted annual rates except as noted.
1983
Item
1981
1982
1984
1983
July
June
Aug.
Sept.
Oct.
Nov.
Dec.
Jan/
Feb/
Mar.
Private residential real estate activity (thousands of units)
N E W UNITS
1 Permits authorized
2
1-family
3 2-or-more-family
986
564
421
1,001
546
454
1,590
891
699
1,761
1,013
748
1,782
920
862
1,652
874
778
1,506
837
669
1,630
880
750
1,642
911
731
1,549
898
651
1,817
1,001
816
1,946
1,107
839
1,714
969
745
4 Started
1-family
5
6 2-or-more-family
1,084
705
379
1,062
663
400
1,703
1,068
636
1,743
1,124
619
1,793
1,048
745
1,873
1,124
749
1,679
1,038
641
1,672
1,017
655
1,730
1,074
656
1,694
1,021
673
1,980
1,301
679
2,231
1,447
784
1,638
1,026
612
682
382
301
720
400
320
1,006
525
482
933
532
400
963
537
425
977
542
435
988
542
446
987
536
450
1,011
543
468
1,020'
542'
478'
1,037
554
483
1,044
562
481
1,266
818
447
1,006
631
374
1,390
924
466
1,386
959
427
1,432
1,000
432
1,729
1,050
679
1,476
966
510
1,567
1,028
539
1,445
994
451
1,489'
986'
503'
1,589
1,001
588
1,551
1,023
528
13 Mobile homes shipped
241
239
295
299
296
307
305
308
313
310
314
293
Merchant builder activity in 1-family units
14 Number sold
15 Number for sale, end of period 1
436
278
413
255
622
303
655
283
606
289
558
296
597
299
624
301
636
304
755'
300'
677
303
700
305
666
321
68.8
69.3
75.5
75.8
75.2
76.8
81.0
75.9
75.9
75.9'
76.5
78.7
78.7
83.1
83.8
89.9
90.9
89.2
91.3
97.8
89.5
91.4
91.7'
92.2
93.4
96.6
2,418
1,991
2,719
2,820
2,780
2,760
2,770
2,720
2,700
2,850
2,890
2,910
3,030
66.1
78.0
67.7
80.4
69.8
82.5
71.4
84.7
71.8
84.2
71.5
84.7
69.9
82.8
69.8
83.0
70.4
83.4
69.9
82.9
71.3
84.8
71.8
84.9
72.4
85.3
7 Under construction, end of period 1
8
1-family
9 2-or-more-family
;
...
10 Completed
11
1-family
12 2-or-more-family
16
17
Price (thousands of dollars)2
Median
Units sold
Units sold
n a.
EXISTING UNITS ( 1 - f a m i l y )
18 Number sold
Price of units sold (thousands of dollars)2
19 Median
20 Average
Value of new construction 3 (millions of dollars)
CONSTRUCTION
21 Total put in place
239,418 232,048 262,668 264,321 274,205 281,997 285,384 265,626
265,780 265,319
275,676 292,004 295,550
7.7 Private
73
Residential
24
Nonresidential, total
Buildings
75
Industrial
76
Commercial
7.7
Other
28
Public utilities and other
186,069 180,979 212,287 214,729 222,759 228,529 232,561 216,976
86,567 74,809 110,708 113,524 122,297 127,136 129,142 116,478
99,502 106,170 101,579 101,205 100,462 101,393 103,419 100.498
214,920 215,497
110,385 107,973
104,535 107,524
224,963 239,202 243,509
116,899 128,286 131,924
108,064 110,916 111,585
79 Public
30
Military
31
Highway
32 Conservation and development
33 Other
17,031
34,243
9,543
38,685
17,346
37,281
10,507
41,036
13,143
36,267
11,705
40,464
13,136
35.898
10,974
41,197
12,227
35,871
11,250
41.114
14,227
36,277
12,038
38,851
13,166
36,901
12,564
40,788
10,532
36,118
12,279
41,569
12,280
38,081
12,001
42,173
12,921
38,955
12,121
43,527
13,091
40,874
13,062
41,037
13,921
42,735
13,077
41,183
13,718
43,807
12,988
41,072
53,346
1,966
13,599
5,300
32,481
51,068
2,205
13,521
5,029
30.313
50,380
2,536
14,178
4,823
28,843
49,592
1,894
12,925
4,853
29,920
51,446
2,655
14,091
5,608
29,092
53,469
2,258
15,906
5,210
30,095
52,823
2,705
15,896
5,048
29,174
48,649
2,458
14,644
4,253
27,294
50,860
3,192
14,360
3,902
29,406
49,821
2,977
14,780
4,896
27,168
50,713
2,821
13,738
4,259
29,895
52,802
2,716
14,928
4,639
30,519
52,041
3,227
15,894
4,479
28,441
1. Not at annual rates.
2. Not seasonally adjusted.
3. Value of new construction data in recent periods may not be strictly
comparable with data in prior periods because of changes by the Bureau of the
Census in its estimating techniques. For a description of these changes see
Construction Reports (C-30—76-5), issued by the Bureau in July 1976.
NOTE. Census Bureau estimates for all series except (a) mobile homes, which
are private, domestic shipments as reported by the Manufactured Housing
Institute and seasonally adjusted by the Census Bureau, and (b) sales and prices of
existing units, which are published by the National Association of Realtors. All
back and current figures are available from originating agency. Permit authorizations are those reported to the Census Bureau from 16,000 jurisdictions beginning
with 1978.
Prices
2.15
A47
CONSUMER AND PRODUCER PRICES
Percentage changes based on seasonally adjusted data, except as noted
Change from 12
months earlier
Change from 3 months earlier
(at annual rate)
Item
1984
Mar.
June
Dec.
Sept.
Mar.
Nov.
Index
level
Mar.
1984
(1967
= 100)'
1984
1983
1984
1983
1983
Mar.
Change from 1 month earlier
Jan.
Dec.
Feb.
Mar.
CONSUMER PRICES 2
3.6
1 All items
7 Food
3 Energy items
4 All items less food and energy
Commodities
6
Services
4.7
5.4
4.0
4.5
5.0
.4
.2
.6
.4
.2
307.3
.7
.2
.3
.2
.4
-.1
-.2
.4
.4
.4
302.2
418.1
296.7
249.9
350.7
2.7
-1.5
4.7
6.1
3.6
4.0
4.6
5.0
4.5
5.3
1.7
19.1
4.2
3.2
4.8
1.1
3.4
5.9
6.8
5.2
4.3
-1.7
4.9
4.6
5.3
9.0
-1.4
5.1
3.4
5.9
.2
.1
.5
.4
.5
.4
-.3
.3
.3
.3
1.6
-.4
.5
.2
.7
2.2
1.6
-4.9
3.8
3.6
2.9
6.1
-1.8
2.8
2.5
2.6
-.9
12.9
2.2
1.7
2.0
2.5
-1.3
2.7
2.1
1.0
5.5'
-9.5
1.2
2.1
6.1
17.8
-8.0
5.0
4.1
-.1
-.y
-1.2'
,4r
.V
.1
.6
2.7
-1.2
.2
.1
.4
.7
.4
.2
.5
.5
.8
-1.2
.9
.3
291.7
277.0
759.8
244.8
292.7
-.4
.7
3.0
3.5
2.8
2.8
4.0
3.6
2.7
3.3
2.5
4.3
.V
.y
.2
.2'
.0
.2
.2
.2
.5
.6
324.2
302.5
.5
1.6
-1.7
8.7
-2.6
12.4
-5.8
-5.1
49.1
15.6
-1.7
16.6
12.4
-2.1
3.4
13.4
-1.5
-10.1
,5r
.2'
.0
1.6 '
,3r
.6
2.2
.4
-3.6
-3.1
.0
.8
4.2
-.8
.2
270.7
780.7
274.6
PRODUCER PRICES
7 Finished goods
8 Consumer foods
9 Consumer energy
10 Other consumer goods
11 Capital equipment
1? Intermediate materials 3
13 Excluding energy
Crude materials
14
IS
16
Energy
Other
1. Not seasonally adjusted.
2. Figures for consumer prices are those for all urban consumers and reflect a
rental equivalence measure of homeownership after 1982.
— .8'
.(K
.y
3. Excludes intermediate materials for food manufacturing and manufactured
animal feeds,
SOURCE. Bureau of Labor Statistics.
A48
2.16
Domestic Nonfinancial Statistics • May 1984
GROSS N A T I O N A L PRODUCT A N D INCOME
Billions of current dollars except as noted; quarterly data are at seasonally adjusted annual rates.
1983
Account
1981
1982
1984
1983
QL
Q2
Q3
Q4
QL
3,436.2
3,541.2
GROSS NATIONAL PRODUCT
1
Total
2,954.1
3,073.0
3,310.5
3,171.5
3,272.0
3,362.2
2
3
4
5
By source
Personal consumption expenditures
Durable goods
Nondurable goods
Services
1,857.2
236.1
733.9
887.1
1,991.9
244.5
761.0
986.4
2,158.0
279.4
804.1
1,074.5
2,073.0
258.5
777.1
1,037.4
2,147.0
277.7
799.6
1,069.7
2,181.1
282.8
814.8
1,083.5
2,230.9
298.6
825.0
1,107.3
2,280.5
310.3
844.4
1,125.8
474.9
456.5
352.2
133.4
218.8
104.3
99.8
414.5
439.1
348.3
141.9
206.4
90.8
86.0
471.9
478.4
348.4
131.1
217.2
130.0
124.9
404.1
443.5
332.1
132.9
199.3
111.3
106.7
450.1
464.6
336.3
127.4
208.8
128.4
123.3
501.1
492.5
351.0
130.9
220.2
141.5
136.3
532.5
512.8
374.0
133.3
240.7
138.8
133.5
595.3
533.1
384.2
140.3
243.9
148.9
143.7
18.4
10.9
-24.5
-23.1
-6.4
-2.8
-39.4
-39.0
-14.5
-10.3
8.5
18.4
19.6
19.7
62.2
41.1
6
7
8
9
10
11
12
13
14
Gross private domestic investment
Fixed investment
Nonresidential
Structures
Producers' durable equipment
Residential structures
Nonfarm
Change in business inventories
Nonfarm
15
16
17
Net exports of goods and services
Exports
Imports
26.3
368.8
342.5
17.4
347.6
330.2
-9.0
335.4
344.4
17.0
326.9
309.9
-8.5
327.1
335.6
-18.3
341.1
359.4
-26.1
346.5
372.6
-45.2
357.7
402.9
18
19
20
Government purchases of goods and services
Federal
State and local
595.7
229.2
366.5
649.2
258.7
390.5
689.5
274.8
414.7
677.4
273.5
404.0
683.4
273.7
409.7
698.3
278.1
420.2
699.0
274.1
424.9
710.6
275.0
435.6
21
22
23
24
25
26
By major type of product
Final sales, total
Goods
Durable
Nondurable
Services
Structures
2,935.6
1,291.8
528.0
763.9
1,374.2
288.0
3,097.5
1,280.8
500.8
780.1
1,511.2
281.0
3,316.9
1,366.5
548.7
817.8
1,635.6
308.4
3,210.9
1,292.2
482.7
809.5
1,588.4
290.9
3,286.6
1,346.8
536.8
810.0
1,623.4
301.9
3,353.7
1,388.9
568.9
820.0
1,651.0
322.3
3,416.6
1,438.2
606.4
831.8
1,679.6
318.5
3,479.0
1,492.4
607.4
885.0
1,711.3
337.5
27
28
29
Change in business inventories
Durable goods
Nondurable goods
18.4
3.6
14.8
-24.5
-15.5
-9.1
-6.4
-3.9
-2.5
-39.4
-38.2
-1.2
-14.5
-8.9
-5.7
8.5
13.1
-4.5
19.6
18.3
1.4
62.2
16.0
46.1
30
MEMO: Total GNP in 1972 dollars
1,513.8
1,485.4
1,535.3
1,490.1
1,525.1
1,553.4
1,572.5
1,604.3
NATIONAL INCOME
31
Total
2,373.0
2,450.4
2,650.2'
2,528.5
2,612.8
2,686.9
2,772.4'
32
33
34
35
36
37
38
Compensation of employees
Wages and salaries
Government and government enterprises
Other
Supplement to wages and salaries
Employer contributions for social insurance
Other labor income
1,769.2
1,493.2
284.4
1,208.8
276.0
132.5
143.5
1,865.7
1,568.1
306.0
1,262.1
297.6
140.9
156.6
1,990.2
1,664.1
326.2
1,338.4
326.1
152.7
173.4
1,923.7
1,610.6
319.2
1,291.5
313.1
148.8
164.3
1,968.7
1,647.1
323.3
1,323.8
321.6
151.5
170.1
2,011.8
1,681.5
328.4
1,353.1
330.3
153.9
176.4
2,056.6
1,717.3
332.1
1,385.2
339.4
156.7
182.7
2,113.0
1,756.2
339.2
1,416.9
356.8
167.9
189.0
39
40
41
Proprietors' income 1
Business and professional 1
Farm 1
120.2
89.7
30.5
109.0
87.4
21.5
128.5
107.6
20.9
120.6
98.4
22.2
127.2
106.2
21.0
126.7
111.2
15.5
139.4
114.5
25.0
169.0
121.7
47.3
42
Rental income of persons 2
41.4
49.9
54.8
54.1
54.8
53.9
56.2
57.0
43
44
45
46
Corporate profits 1
Profits before tax 3
Inventory valuation adjustment
Capital consumption adjustment
192.3
227.0
-23.6
-11.0
164.8
174.2
-8.4
-1.1
229.1
207.5
-9.2
30.8
181.8
169.7
-1.7
13.9
218.2
203.3
-10.6
25.6
248.4
229.1
-18.3
37.6
268.2'
228.2'
-6.3
46.2
-10.0
50.3
47
Net interest
249.9
261.1
247.5
248.3
243.8
246.1
251.9
262.0
1. With inventory valuation and capital consumption adjustments.
2. With capital consumption adjustment.
3. For after-tax profits, dividends, and the like, see table 1.48.
SOURCE. Survey of Current Business (Department of Commerce).
n.a.
n.a.
n.a.
National Income Accounts
2.17
A49
PERSONAL INCOME AND SAVING
Billions of current dollars; quarterly data are at seasonally adjusted annual rates. Exceptions noted.
1984
1983
1983
1982
1981
QL
Q2
Q3
Q4
Ql
PERSONAL INCOME AND SAVING
1 Total personal income
2,435.0
2,578.6
2,742.1
2,657.7
2,713.6
2,761.9
2,835.2
2,924.6
2 Wage and salary disbursements
3
Commodity-producing industries
Manufacturing
4
Distributive industries
5
6
Service industries
7
Government and government enterprises
1,493.2
509.5
385.3
361.6
337.7
284.4
1,568.1
509.2
383.8
378.8
374.1
306.0
1,664.6
529.7
402.8
397.2
411.5
326.2
1,610.7
508.6
385.4
386.4
396.4
319.2
1,648.4
522.2
397.4
394.3
407.3
324.6
1,681.9
537.8
409.2
398.9
416.4
328.8
1,717.3
550.0
419.0
409.3
425.8
332.1
1,756.2
567.1
432.8
415.4
434.4
339.2
143.5
120.2
89.7
30.5
41.4
62.8
341.3
337.2
182.0
156.6
109.0
87.4
21.5
49.9
66.4
366.2
374.6
204.5
173.4
128.5
107.6
20.9
54.8
70.5
366.3
403.6
222.8
164.3
120.6
98.4
22.2
54.1
68.8
357.2
398.5
217.4
170.1
127.2
106.2
21.0
54.8
69.3
357.1
405.3
221.1
176.4
126.7
111.2
15.5
53.9
70.9
369.9
402.6
223.8
182.7
139.4
114.5
25.0
56.2
72.9
381.1
408.1
228.8
189.0
169.0
121.7
47.3
57.0
75.1
395.8
411.3
233.1
8
9
10
11
12
13
14
15
16
17
Other labor income
Proprietors' income 1
Business and professional 1
Farm 1
Rental income of persons 2
Dividends
Personal interest income
Transfer payments
Old-age survivors, disability, and health insurance benefits.
LESS: Personal contributions for social insurance
18 EQUALS: Personal income
104.6
112.0
119.5
116.5
118.6
120.5
122.5
128.7
2,435.0
2,578.6
2,742.1
2,657.7
2,713.6
2,761.9
2,835.2
2,924.6
387.4
402.1
406.5
401.8
412.6
400.1
411.4
421.3
20 EQUALS: Disposable personal income
2,047.6
2,176.5
2,335.6
2,255.9
2,301.0
2,361.7
2,423.9
2,503.3
21
LESS: Personal outlays
1,912.4
2,051.1
2,222.0
2,134.2
2,209.5
2,245.9
2,298.3
2,350.0
22 EQUALS: Personal saving
135.3
125.4
113.6
121.7
91.5
115.8
125.6
153.3
6,584.1
4,161.5
4,587.0
6.6
6,399.3
4,179.8
4,567.0
5.8
6,552.8
4,316.7
4,672.0
4.9
6,381.5
4,225.7
4,599.0
5.4
6.518.0
4.319.1
4,629.0
4.0
6,622.5
4,331.4
4,690.0
4.9
6,687.5
4,389.8
4,769.0
5.2
6,809.2
4,443.0
4,877.0
6.1
27 Gross saving
483.8
405.8
439.6
398.5
420.6
455.4
484.0'
28
29
30
31
509.6
135.3
44.8
-23.6
521.6
125.4
37.0
-8.4
569.9''
113.6
78.9
-9.2
541.5
121.7
48.9
-1.7
535.0
91.5
70.1
-10.6
587.2
115.8
89.7
-18.3
615.7
125.6
107.0'
-6.3
-10.0
202.9
126.6
.0
222.0
137.2
.0
231.6
145.7
.0
228.3
142.6
.0
229.8
143.5
.0
233.1
148.6
.0
235.2
148.0
.0
238.0
150.3
.0
-26.9
-62.2
35.3
-115.8
-147.1
31.3
-130.2
-181.6
51.4
-142.9
-183.3
40.4
-114.4
-166.1
51.7
-131.8
-187.3
55.5
-131.8
-189.9
58.1
n.a.
n.a.
n.a.
19
LESS: Personal tax and nontax payments
MEMO
Per capita (1972 dollars)
23 Gross national product
24
Personal consumption expenditures
25 Disposable personal income
26 Saving rate (percent)
GROSS SAVING
Gross private saving
Personal saving
Undistributed corporate profits 1
Corporate inventory valuation adjustment
Capital consumption allowances
32 Corporate
33 Noncorporate
34 Wage accruals less disbursements
35 Government surplus, or deficit ( - ) , national income and
product accounts
Federal
State and local
36
37
n.a.
n.a.
153.3
n.a.
1.1
.0
.0
.0
.0
.0
.0
.0
39 Gross investment
478.9
406.2
437.4
397.4
417.1
457.9
477.1
525.7
40 Gross private domestic
41 Net foreign
474.9
4.0
414.5
-8.3
471.9
-34.6
404.1
-6.7
450.1
-33.0
501.1
-43.2
532.5
-55.3
595.3
-69.6
-4.9
.5
-2.V
-1.2
-3.5
2.5
-6.7
-6.7
38 Capital grants received by the United States, net
42 Statistical discrepancy
1. With inventory valuation and capital consumption adjustments.
2. With capital consumption adjustment.
SOURCE. Survey of Current Business (Department of Commerce).
A50
3.10
International Statistics • May 1984
U.S. I N T E R N A T I O N A L TRANSACTIONS
Summary
Millions of dollars; quarterly data are seasonally adjusted except as noted.1
1982
Item credits or debits
1982
1981
1983
1983P
Q4
1 Balance on current account
3
4
5
6
7
8
Merchandise trade balance 2
Merchandise exports
Merchandise imports
Military transactions, net
Investment income, net 3
Other service transactions, net
9
10
Remittances, pensions, and other transfers
U.S. government grants (excluding military)
Q4p
Q3
Q2
Qi
4,592
-11,211
-40,776
-6,621
-5,546
-3,665
-3,395
-9,747
-8,898
-12,074
-14,101
-15,291
-14,382
-28,067
237,019
-265,086
-1,355
33,484
7,462
-36,389
211,217
-247,606
179
27,304
5,729
-60,550
200,203
-260,753
483
23,581
4,309
-11,354
48,344
-59,698
-26
6,008
1,182
-8,856
49,350
-58,206
516
5,036
1,200
-14,705
48,757
-63,462
117
5,630
1,034
-18,178
50,429
-68,607
-132
6,881
1,470
-18,811
51,667
-70,478
-17
6,032
604
-2,382
-4,549
-2,621
-5,413
-2,631
-5,967
-661
-1,770
-608
-953
-636
-1.187
-662
-1,453
-724
-2,375
11 Change in U.S. government assets, other than official
reserve assets, net (increase, - )
-5,078
-5,732
-4,897
-934
-1,053
-1,162
-1,206
-1,476
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
-5,175
0
-1,823
-2,491
-861
-4,965
0
-1,371
-2,552
-1,041
-1,196
0
-66
-4,434
3,304
-1,949
0
-297
-732
-920
-787
0
-98
-2,139
1,450
16
0
-303
-212
531
529
0
-209
-88
826
-953
0
545
-1,996
498
17 Change in U.S. private assets abroad (increase, - ) 3
18 Bank-reported claims
19 Nonbank-reported claims
20 U.S. purchase of foreign securities, net
21 U.S. direct investments abroad, net 3
-100,348
-83,851
-1,181
-5,636
-9,680
-107,348
-109,346
6,976
-7,986
3,008
-43,204
-24,966
-3,146
-7,484
-7,608
-16,670
-17,511
2,337
-3,527
2,031
-19,793
-15,935
-2,374
-1,808
324
570
5,166
-440
-3,222
-934
-8,449
-2,025
-332
-1,543
-4,549
-15,532
-12,172
n.a.
-912
-2,448
22 Change in foreign official assets in the United States
(increase, +)
23
U.S. Treasury securities
24 Other U.S. government obligations
25 Other U.S. government liabilities4
26 Other U.S. liabilities reported by U.S. banks
27 Other foreign official assets 5
5,430
4,983
1,289
-28
-3,479
2,665
3,172
5,759
-670
504
-2,054
-367
6,083
7,140
-464
318
877
-1,788
1,661
4,346
-556
130
-1,717
-542
49
3,008
-371
-270
-1,939
-379
1,973
1,955
-170
403
611
-826
-2,581
-538
-363
207
-1,425
-462
6,642
2,715
440
-22
3,630
-121
28 Change in foreign private assets in the United States
(increase, +) 3
29 U.S. bank-reported liabilities
30 U.S. nonbank-reported liabilities
31 Foreign private purchases of U.S. Treasury securities, net
32 Foreign purchases of other U.S. securities, net
33 Foreign direct investments in the United States, net 3
75,248
42,154
942
2,982
7,171
21,998
84,693
64,263
-3,104
7,004
6,141
10,390
76,935
51,295
-1,060
8,599
8,587
9,514
9,856
2,823
20
2,257
1,975
2,781
16,404
10,588
-2,136
2,912
2,986
2,054
8,984
919
134
3,072
2,628
2,231
22,028
15,068
942
1,011
1,842
3,165
29,521
24,720
n.a.
1,604
1,132
2,065
34 Allocation of SDRs
35 Discrepancy
1,093
24,238
0
41,390
0
7,054
0
14,657
1,042
0
8,845
-200
0
-634
802
0
1,753
-1,361
0
-2,911
758
24,238
41,390
7,054
13,615
9,045
-1,436
3,114
-3,669
-5,175
-4,965
-1,196
-1,949
-787
16
529
-953
5,458
2,668
5,765
1,531
319
1,570
-2,788
6,664
13,581
7,420
-8,591
-1,162
-1,397
-3,433
-2,104
-1,657
680
644
209
158
42
30
49
88
37
Statistical discrepancy in recorded data before seasonal
adjustment
MEMO
Changes in official assets
U.S. official reserve assets (increase, - )
Foreign official assets in the United States
(increase, +)
40 Change in Organization of Petroleum Exporting Countries
official assets in the United States (part of line 22
above)
41 Transfers under military grant programs (excluded from
lines 4, 6, and 10 above)
38
39
1. Seasonal factors are no longer calculated for lines 12 through 41.
2. Data are on an international accounts (IA) basis. Differs from the Census
basis data, shown in table 3.11, for reasons of coverage and timing; military
exports are excluded from merchandise data and are included in line 6.
3. Includes reinvested earnings of incorporated affiliates.
4. Primarily associated with military sales contracts and other transactions
arranged with or through foreign official agencies.
5. Consists of investments in U.S. corporate stocks and in debt securities of
private corporations and state and local governments.
NOTE. Data are from Bureau of Economic Analysis, Survey of Current Business
(Department of Commerce).
Trade and Reserve and Official Assets
3.11
A51
U.S. FOREIGN TRADE
Millions of dollars; monthly data are seasonally adjusted.
1984
1983
Item
1981
1982
1983
Sept.
1 EXPORTS of domestic and foreign
merchandise excluding grant-aid
shipments
233,677
212,193
200,486
17,257
Oct.
Nov.
17,063
17,033
Dec.
17,298
Jan.
Feb.
18,326
17,212
Mar.
17,727
2 GENERAL IMPORTS including merchandise for immediate consumption plus entries into bonded
warehouses
261,305
243,952
258,048
22,451
24,333
23,115
22,976
26,586
26,147
26,771
3 Trade balance
-27,628
-31,759
-57,562
-5,195
-7,300
-6,052
-5,678
-8,260
-8,935
-9,044
NOTE. The data through 1981 in this table are reported by the Bureau of Census
data of a free-alongside-ship (f.a.s.) value basis—that is, value at the port of
export. Beginning in 1981, foreign trade of the U.S. Virgin Islands is included in
the Census basis trade data; this adjustment has been made for all data shown in
the table. Beginning with 1982 data, the value of imports are on a customs
valuation basis.
The Census basis data differ from merchandise trade data shown in table 3.10,
U.S. International Transactions Summary, for reasons of coverage and timing. On
the export side, the largest adjustments are: (1) the addition of exports to Canada
3.12
not covered in Census statistics, and (2) the exclusion of military sales (which are
combined with other military transactions and reported separately in the "service
account" in table 3.10, line 6). On the import side, additions are made for gold,
ship purchases, imports of electricity from Canada, and other transactions;
military payments are excluded and shown separately as indicated above.
SOURCE. FT900 "Summary of U.S. Export and Import Merchandise Trade"
(Department of Commerce, Bureau of the Census).
U.S. RESERVE ASSETS
Millions of dollars, end of period
1984
1983
Type
1980
1981
1982
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
1 Total
26,756
30,075
33,958
33,273
33,655
33,747
33,887
34,823
34,978
34,588
2 Gold stock, including Exchange Stabilization Fund 1
11,160
11,151
11,148
11,126
11,123
11,121
11,120
11,116
11,111
11,107
2,610
4,095
5,250
5,641
5,735
5,025
5,050
5,320
5,341
5,266
3
Special drawing rights2 3
4
Reserve position in International Monetary Fund 2
5
Foreign currencies 4 - 5
2,852
5,055
7,348
9,554
9,883
11,312
11,422
11,710
11,709
11,621
10,134
9,774
10,212
6,952
6,914
6,289
6,295
6,677
6,817
6,594
1. Gold held under earmark at Federal Reserve Banks for foreign and international accounts is not included in the gold stock of the United States; see table
3.13. Gold stock is valued at $42.22 per fine troy ounce.
2. Beginning July 1974, the IMF adopted a technique for valuing the SDR based
on a weighted average of exchange rates for the currencies of member countries.
From July 1974 through December 1980, 16 currencies were used; from January
1981, 5 currencies have been used. The U.S. SDR holdings and reserve position in
the IMF also are valued on this basis beginning July 1974.
3.13
3. Includes allocations by the International Monetary Fund of SDRs as follows:
$867 million on Jan. 1, 1970; $717 million on Jan. 1, 1971; $710 million on Jan. 1,
1972; $1,139 million on Jan. 1, 1979; $1,152 million on Jan. 1, 1980; and $1,093
million on Jan. 1, 1981; plus transactions in SDRs.
4. Valued at current market exchange rates.
5. Includes U.S. government securities held under repurchase agreement
against receipt of foreign currencies in 1979 and 1980.
FOREIGN OFFICIAL ASSETS HELD AT FEDERAL RESERVE BANKS
Millions of dollars, end of period
1983
Assets
1980
Oct.
1 Deposits
Assets held in custody
2 U.S. Treasury securities 1
3 Earmarked gold2
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
411
505
328
339
360
190
251
246
222
345
102,417
14,965
104,680
14,804
112,544
14,716
116,327
14,550
116,398
14,475
117,670
14,414
117,076
14,347
119,499
14,291
116,768
14,278
117,808
14,278
1. Marketable U.S. Treasury bills, notes, and bonds; and nonmarketable U.S.
Treasury securities payable in dollars and in foreign currencies.
2. Earmarked gold is valued at $42.22 per fine troy ounce.
1984
1982
1981
NOTE. Excludes deposits and U.S. Treasury securities held for international
and regional organizations. Earmarked gold is gold held for foreign and international accounts and is not included in the gold stock of the United States.
A52
3.14
International Statistics • May 1984
FOREIGN BRANCHES OF U.S. BANKS
Balance Sheet Data
Millions of dollars, end of period
1983
Aug.
Sept.
Oct.
1984
Nov.
Dec/
Jan.
Feb.''
All foreign countries
1 Total, all currencies
2 Claims on United States
3 Parent bank
4
Other
5 Claims on foreigners
Other branches of parent bank
6
7
Banks
Public borrowers
8
Nonbank foreigners
9
10 Other assets
11 Total payable in U.S. dollars
12 Claims on United States
13 Parent bank
14 Other
15 Claims on foreigners
16 Other branches of parent bank
17 Banks
18 Public borrowers
19 Nonbank foreigners
20 Other assets
401,135
462,847
469,432
452,596
460,261
458,894
463,467
475,593
453,982
462,397
28,460
20,202
8,258
63,743
43,267
20,476
91,768
61,629
30,139
99,484
67,137
32,347
101,356
65,561
35,795
102,497
69,655
32,842
109,511
75,521
33,990
114,956
81,004
33,952
110,969
76,430
34,539
112,765
79,244
33,521
354,960
77,019
146,448
28,033
103,460
378,954
87,821
150,763
28,197
112,173
358,258
91,143
133,640
24,090
109,385
335,036
84,572
119,288
25,147
106,029
340,413
89,304
120,177
24,982
105,950
337,848
87,543
117,631
25,061
107,613
335,518
89,447
114,495
24,256
107,320
342,018
92,634
117,576
24,360
107,448
324,094
86,866
106,877
23,951
106,400
329,756
85,728
110,265
24,342
109,421
17,715
20,150
19,406
18,076
18,492
18,549
18,438
18,619
18,919
19,876
291,798
350,735
361,712
348,330
354,595
351,483
358,204
370,515
348,454
349,833
27,191
19,896
7,295
62,142
42,721
19,421
90,048
60,973
29,075
96,995
65,711
31,284
98,510
63,716
34,794
99,938
68,126
31,812
107,015
73,999
33,016
112,850
79,914
32,936
108,866
75,283
33,583
110,520
78,015
32,505
255,391
58,541
117,342
23,491
56,017
276,937
69,398
122,110
22,877
62,552
259,646
73,512
106,338
18,374
61,422
241,063
66,609
93,806
18,804
61,844
245,541
71,273
95,113
18,455
60,700
241,221
69,324
92,048
18,644
61,205
240,768
71,451
90,143
17,752
61,422
247,080
75,131
93,248
17,817
60,884
229,041
69,006
82,553
17,670
59,812
228,852
66,772
84,398
17,784
59,898
9,216
11,656
12,018
10,272
10,544
10,324
10,421
10,585
10,547
10,461
United Kingdom
21 Total, all currencies
22 Claims on United States
23 Parent bank
24
Other
25 Claims on foreigners
26
Other branches of parent bank
27
Banks
28 Public borrowers
29 Nonbank foreigners
30 Other assets
31 Total payable in U.S. dollars
32 Claims on United States
33 Parent bank
34 Other
35 Claims on foreigners
36 Other branches of parent bank
37
Banks
38 Public borrowers
39 Nonbank foreigners
40 Other assets
144,717
157,229
161,067
154,865
156,048
156,803
155,964
158,717
155,098
157,973
7,509
5,275
2,234
11,823
7,885
3,938
27,354
23,017
4,337
29,722
22,169
7,553
28,947
20,816
8,131
30,853
25,507
5,346
32,352
26,872
5,480
34,433
29,111
5,322
35,634
29,759
5,875
36,647
30,876
5,771
131,142
34,760
58,741
6,688
30,953
138,888
41,367
56,315
7,490
33,716
127,734
37,000
50,767
6,240
33,727
119,672
35,555
44,303
6,342
33,472
121,518
36,382
45,451
6,274
33,411
120,660
36,556
43,888
6,280
33,936
118,275
35,642
42,683
6,307
33,643
119,280
36,565
43,352
5,898
33,465
114,287
34,842
40,126
6,056
33,263
116,055
33,296
42,508
6,005
34,246
6,066
6,518
5,979
5,471
5,583
5,290
5,337
5,004
5,177
5,271
99,699
115,188
123,740
119,377
121,238
121,817
121,744
125,997
121,197
121,945
7,116
5,229
1,887
11,246
7,721
3,525
26,761
22,756
4,005
28,905
21,720
7,185
27,837
20,036
7,801
30,095
25,084
5,011
31,671
26,537
5,134
33,756
28,756
5,000
34,917
29,414
5,503
35,935
30,516
5,419
89,723
28,268
42,073
4,911
14,471
99,850
35,439
40,703
5,595
18,113
92,228
31,648
36,717
4,329
19,534
86,868
30,053
31,718
4,410
20,687
89,530
31,409
33,237
4,329
20,555
88,253
31,414
31,796
4,346
20,697
86,614
30,371
31,158
4,377
20,708
88,917
31,838
32,188
4,194
20,697
83,161
29,741
28,756
4,349
20,315
83,067
28,103
30,331
4,241
20,392
2,860
4,092
4,751
3,604
3,871
3,469
3,459
3,324
3,119
2,943
Bahamas and Caymans
41 Total, all currencies
42 Claims on United States
43 Parent bank
44 Other
45 Claims on foreigners
46 Other branches of parent bank
47 Banks
48 Public borrowers
49 Nonbank foreigners
50 Other assets
51 Total payable in U.S. dollars
123,837
149,108
145,156
139,699
143,148
141,311
147,257
151,463
141,293
140,198
17,751
12,631
5,120
46,546
31,643
14,903
59,403
34,653
24,750
63,923
40,308
23,615
66,547
40,152
26,395
66,253
40,105
26,148
71,363
44,414
26,949
74,728
47,703
27,025
70,459
43,174
27,285
70,705
44,301
26,404
101,926
13,342
54,861
12,577
21,146
98,057
12,951
55,151
10,010
19,945
81,450
18,720
42,699
6,413
13,618
72,021
15,354
37,350
6,404
12,913
72,826
16,789
36,609
6,461
12,967
71,268
15,817
35,964
6,643
12,844
71,995
17,993
35,353
5,890
12,759
72,788
17,340
36,767
6,084
12,597
66,916
15,989
32,451
5,992
12,484
65,597
14,655
32,527
5,956
12,459
4,160
4,505
4,303
3,755
3,775
3,790
3,899
3,947
3,918
3,896
117,654
143,743
139,605
133,233
136,851
134,684
140,841
145,017
134,881
133,825
Overseas Branches
3.14
A53
Continued
1983
Liability account
1984
1980
Aug.
Sept.
Oct.
Nov.
Dec.'
Jan.
Feb.''
All foreign countries
401,135
462,847
469,432
452,596
460,261
458,894
463,467
475,593
453,982
462,397
53 To United States
54 Parent bank
55 Other banks in United States
56 Nonbanks
91,079
39,286
14,473
37,275
137,767
56,344
19,197
62,226
178,918
75,561
33,368
69,989
183,864
77,556
29,880
76,428
182,588'
78,027
30,961'
73,600'
185,551'
85,028
27,094
73,429'
184,202'
79,574
26,264
78,364'
187,481
80,459
29,175
77,847
179,255
76,845
26,718
75,692
182,553
79,230
25,633
77,690
57 To foreigners
58 Other branches of parent bank
59 Banks
60 Official institutions
61 Nonbank foreigners
295,411
75,773
132,116
32,473
55,049
305,630
86,396
124,906
25,997
68,331
270,678
90,148
96,739
19,614
64,177
250,563
81,714'
85,433
17,830
65,586'
259,525'
86,714'
86,550
20,513
65,748'
254,682'
84,004'
84,533
19,403
66,742'
260,335'
86,792'
88,023
18,377
67,143'
268,958
88,903
92,800
18,801
68,454
255,954
81,983
86,564
19,507
67,900
260,190
,81,856
89,076
20,450
68,808
52 Total, all currencies
62 Other liabilities
63 Total payable in U.S. dollars
64 To United States
65 Parent bank
66 Other banks in United States
67 Nonbanks
68 To foreigners
69 Other branches of parent bank
70 Banks
71 Official institutions
72 Nonbank foreigners
73 Other liabilities
14,690
19,450
19,836
18,169
18,148
18,661
18,930
19,154
18,773
19,654
303,281
364,447
379,003
365,584'
373,061'
369,936'
374,426'
387,287
365,144
367,285
88,157
37,528
14,203
36,426
134,700
54,492
18,883
61,325
175,431
73,235
33,003
69,193
180,174'
75,245'
29,334
75,595
178,814'
75,743'
30,415
72,656'
181,645'
82,661'
26,538
72,446'
180,206'
77,127'
25,773
77,306'
183,766
78,257
28,641
76,868
175,435
74,493
26,224
74,718
178,239
76,636
25,066
76,537
206,883
58,172
87,497
24,697
36,517
217,602
69,299
79,594
20,288
48,421
192,348
72,878
57,355
15,055
47,060
175,616
64,522'
49,522
13,029
48,543'
184,430'
69,308'
50,862
15,400
48.86C
178,943'
66,502'
48,264
14,630
47,547'
184,278'
69,457'
52,072
13,453
49,296'
193,785
71,899
57,013
13,852
51,021
180,795
64,926
50,604
14,673
50,592
179,720
63,469
50,675
15,829
49,747
8,241
12,145
11,224
9,794
9,817
9,348
9,942
9,736
8,914
9,326
United Kingdom
74 Total, all currencies
75 To United States
76 Parent bank
77 Other banks in United States
78 Nonbanks
79 To foreigners
80 Other branches of parent bank
81 Banks
8?
Official institutions
83 Nonbank foreigners
144,717
157,229
161,067
154,865
156,048
156,803
155,964
158,717
155,098
157,973
21,785
4,225
5,716
11,844
38,022
5,444
7,502
25,076
53,954
13,091
12,205
28,658
58,347
16,145
12,462
29,740
56,924
16,852
12,174
27,898
60,903
21,385
10,751
28,767
57,095
17,312
10,176
29,607
55,799
14,021
11,328
30,450
55,620
17,077
10,640
27,903
56,596
18,333
10,570
27,693
117,438
15,384
56,262
21,412
24,380
112,255
16,545
51,336
16,517
27,857
99,567
18,361
44,020
11,504
25,682
89,458
17,595
37,571
9,588
24,704
92,122
19,365
37,122
11,448
24,187
88,727
18,288
35,847
10,611
23,981
91,714
18,841
38,888
10,071
23,914
95,847
19,038
41,624
10,151
25,034
92,268
18,526
38,812
10,530
24,400
93,689
17,716
39,548
11,531
24,894
5,494
6,952
7,546
7,060
7,002
7,173
7,155
7,071
7,210
7,688
103,440
120,277
130,261
125,656
127,868
128,600
127,234
131,152
126,989
127,623
86 To United States
87 Parent bank
88 Other banks in United States
89 Nonbanks
21,080
4,078
5,626
11,376
37,332
5,350
7,249
24,733
53,029
12,814
12,026
28,189
57,359
15,829
12,223
29,307
55,931
16,673
11,886
27,372
59,824
21,145
10,523
28,156
55,907
17,094
9,880
28,933
54,691
13,839
11,044
29,808
54,537
16,840
10,406
27,291
55,151
17,926
10,247
26,978
90 To foreigners
91 Other branches of parent bank
97 Banks
93 Official institutions
94 Nonbank foreigners
79,636
10,474
35,388
17,024
16,750
79,034
12,048
32,298
13,612
21,076
73,477
14,300
28,810
9,668
20,699
64,801
13,421
24,447
7,630
19,303
68,252
15,166
24,478
9,381
19,227
65,347
14,542
23,136
8,742
18,927
68,011
15,044
26,343
8,029
18,595
73,279
15,403
29,320
8,279
20,277
69,557
14,758
26,386
8,594
19,819
69,393
13,931
26,229
9,777
19,456
2,724
3,911
3,755
3,496
3,685
3,429
3,316
3,182
2,895
3,079
84 Other liabilities
85 Total payable in U.S. dollars
95 Other liabilities
Bahamas and Caymans
% Total, all currencies
123,837
149,108
145,156
139,699
143,148
141,311
147,257
151,463
141,293
140,198
106,633'
46,676
14,117
45,84C
110,762
50,187
15,711
44,864
103,896
44,604
14,391
44,901
104,485
44,186
13,533
46,766
38,164'
15,521'
9,618
1,624
11,401'
38,362
13,376
11,869
1,916
11,201
35,157
12,253
9,883
2,309
10,712
33,440
11,789
9,351
1,870
10,430
97 To United States
98 Parent bank
99 Other banks in United States
100 Nonbanks
59,666
28,181
7,379
24,106
85,759
39,451
10,474
35,834
104,425
47,081
18,466
38,878
104,470
46,491
14,560
43,419
104,59c
45,493
16,17C
42,927'
104.15C
48,235
14,322
41,593'
101 To foreigners
102 Other branches of parent bank
103 Banks
104 Official institutions
105 Nonbank foreigners
61,218
17,040
29,895
4,361
9,922
60,012
20,641
23,202
3,498
12,671
38,274
15,796
10,166
1,967
10,345
32,875
11,621'
8,737
2,170
10,347'
36,239'
13,357'
9,506
2,237
11,139'
34,782'
12,634'
9,059
1,976
11,113'
106 Other liabilities
107 Total payable in U.S. dollars
2,953
3,337
2,457
119,657
145,284
141,908
2,354
136,228'
2,319
139,855'
2,379
137,514'
2,460
2,339
2,240
2,273
143,604'
147,658
137,429
136,514
A54
3.15
International Statistics • May 1984
SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS
Millions of dollars, end of period
1983r
Item
1 Total1
4
5
6
By type
Liabilities reported by banks in the United States 2
U.S. Treasury bills and certificates 3
U.S. Treasury bonds and notes
Marketable
Nonmarketable 4
U.S. securities other than U.S. Treasury securities 5
7
8
9
10
11
12
By area
Western Europe 1
Canada
Latin America and Caribbean
Asia
Africa
Other countries 6
2
3
1981
Sept.
Oct.
Nov.
Dec.
Jan/
Feb.
Mar.P
169,735
172,718
171,465
173,216
173,860
177,859
176,239
176,820
174,661
26,737
52,389
24,989
46,658
21,924
50,374
22,057
51,618
22,816
52,558
25,422
54,341
22,768
55,327
23,150
56,084
23,187
53,681
53,186
11,791
25,632
67,733
8,750
24,588
69,205
7,950
22,012
69,715
7,950
21,876
68,942
7,250
22,294
68,541
7,250
22,305
69,080
7,250
21,814
69,116
6,600
21,870
69,547
6,600
21,646
65,699
2,403
6,953
91,607
1,829
1,244
61,298
2,070
6,057
96,034
1,350
5,909
63,874
2,707
5,502
92,767
1,196
5,419
64,894
2,811
5,629
92,305
1,023
6,554
65,648
2,665
6,468
91,457
801
6,821
67,669
2,438
6,217
92,488
958
8,089
66,208
2,511
6,443
92,181
1,051
7,845
67,926
2,329
7,605
90,523
1,067
7,370
67,676
1,922
6,439
90,449
1,035
7,135
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.
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 thosepayable in foreign currencies through 1974) and Treasury bills issued to official
institutions of foreign countries.
4. Excludes notes issued to foreign official nonreserve agencies. Includes
bonds and notes payable in foreign currencies.
3.16
1984
1982
NOTE. Based on Treasury Department data and on data reported to the
Treasury Department by banks (including Federal Reserve Banks) and securities
dealers in the United States.
LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Banks in the United States
Payable in Foreign Currencies
Millions of dollars, end of period
1983
Item
1980
1981
1982
Mar/
1 Banks' own liabilities
2 Banks' own claims
3 Deposits
4
Other claims
5 Claims of banks' domestic customers'
1. Assets owned by customers of the reporting bank located in the United
States that represent claims on foreigners held by reporting banks for the accounts
of their domestic customers.
3,748
4,206
2,507
1,699
962
3,523
4,980
3,398
1,582
971
4,844
7,707
4,251
3,456
676
5,088
8,110
3,728
4,382
637
June'
5,880
7,862
3,912
3,950
684
Sept/
5,976
7,984
3,061
4,923
717
Dec.
5,205
7,256
2,838
4,418
1,059
NOTE. Data on claims exclude foreign currencies held by U.S. monetary
authorities,
Nonbank-Reported
3.17
LIABILITIES TO FOREIGNERS
Payable in U.S. dollars
Data
A55
Reported by Banks in the United States
Millions of dollars, end of period
1983
Holder and type of liability
1980
1981A
1984
1982
Sept/
Oct.
Nov.
Dec.
Jan.'
Feb.
Mar.P
1 All foreigners
205,297
243,889
307,056
338,026
338,117'
351,382'
369,226'
358,486
368,502
376,457
2 Banks' own liabilities
3 Demand deposits
4 Time deposits 1
5 Other 2
6 Own foreign offices3
124,791
23,462
15,076
17,583
68,670
163,817
19,631
29,039
17,647
97,500
227,089
15,889
68,035
23,946
119,219
251,994
16,327
81,624
24,656
129,387
249,952'
17,094
80,865'
22,288'
129,706'
262,226'
17,198
84,735'
22,863'
137,430'
278,644'
17,594
90,098'
26,100
144,851'
264,478
16,100
87,691
23,287
137,401
271,459
16,640
91,068
23,970
139,781
284,250
17,609
96.183
24,565
145,892
80,506
57,595
80,072
55,315
79,967
55,628
86,032
64,062
88,165'
65,735
89,156
66,746
90,582
68,669
94,007
71,083
97,043
74,277
92,207
69,669
20,079
2,832
18,788
5,970
20,636
3,702
17,302
4,669
17,182
5,247'
17,721
4,690
17,529
4,385
18,063
4,862
17,880
4,886
18,051
4,486
2,344
2,721
4,922
5,308
4,619
6,363'
5,957
4,759
6,831
6,253
444
146
85
212
638
262
58
318
1,909
106
1,664
139
3,024
252
2,168
605
3,294
452
2,487
355
4,939'
437
4,079
423'
4,632
297
3,885
449
2,867
271
2,235
361
2,317
347
1,611
360
4,057
414
2,666
977
1,900
254
2,083
541
3,013
1,621
2,284
1,442
1,325
441
1,424
484
1,325
463
1,892
1,045
4,514
3,416
2,196
1,224
1,646
0
1,542
0
1,392
0
842
0
884
0
939
0
862
0
847
0
1,098
0
971
0
20 Official institutions8
86,624
79,126
71,647
72,299
73,675
75,374
79,764
78,095
79,234
76,867
21 Banks' own liabilities
22 Demand deposits
n Time 2deposits1
24 Other
17,826
3,771
3,612
10,443
17,109
2,564
4,230
10,315
16,640
1,899
5,528
9,212
16,147
1,886
6,228
8,033
16,532
1,818
6,661'
8,053'
16,673
2,023
6,723'
7,926'
19,315
1,837
7,294
10,184
16,488
1,753
7,286
7,449
17,493
1,663
7,638
8,192
16,934
2,038
6,467
8,429
25 Banks' custody liabilities4
26
U.S. Treasury bills and certificates 5
27 Other negotiable and readily transferable
instruments 6
28 Other
68,798
56,243
62,018
52,389
55,008
46,658
56,152
50,374
57,144
51,618
58,701
52,558
60,448
54,341
61,607
55,327
61,741
56,084
59,933
53,681
12,501
54
9,581
47
8,321
28
5,745
32
5,489
36
6,115
28
6,082
25
6,257
23
5,623
34
6,234
19
29 Banks9
96,415
136,008
185,881
206,381
204,672'
214,010'
226,485'
217,907
222,587
232,786
30 Banks' own liabilities
Unaffiliated foreign banks
31
Demand deposits
32
33
Time deposits 1
Other 2
34
35 Own foreign offices3
90,456
21,786
14,188
1,703
5,895
68,670
124,312
26,812
11,614
8,720
6,477
97,500
169,449
50,230
8,675
28,386
13,169
119,219
185,313
55,926
8,618
31,883
15,425
129,387
182,731'
53,025'
9,102
30,691'
13,232'
129,706'
192,572'
55,142'
8,770
32,678'
13,695'
137,43C
204,945'
60,094'
8,756
36,734'
14,604
144,851'
195,330
57,929
8,151
35,036
14,743
137,401
200,068
60,287
8,396
37,358
14,534
139,781
210,415
64,524
8,359
41,799
14,366
145,892
5,959
623
11,696
1,685
16,432
5,809
21,069
9,440
21,941
10,036
21,438
9,967
21,540
10,178
22,576
10,776
22,519
10,756
22,371
10,763
2,748
2,588
4,400
5,611
7,857
2,766
7,553
4,075
7,542
4,363
7,251
4,221
7,485
3,877
7,416
4,384
7,395
4,368
7,451
4,157
40 Other foreigners
19,914
26,035
44,606
54,038
55,151'
55,635
57,021
57,725
59,850
60,551
41 Banks' own liabilities
Demand deposits
4?
43 Time deposits
44
Other 2
16,065
5,356
9,676
1,033
21,759
5,191
16,030
537
39,092
5,209
32,457
1,426
47,510
5,571
41,345
594
47,396'
5,723
41,025'
648
48,042
5,968
41,255
819
49,751
6,703
42,185
863
49,793
5,925
43,134
734
51,580
6,234
44,462
884
52,843
6,798
45,252
794
3,849
474
4,276
699
5,514
1,540
6,528
2,805
7,755
3,640
7,593
3,737
7,269
3,686
7,932
3,935
8,270
4,021
7,707
4,001
3,185
190
3,265
312
3,065
908
3,162
561
3,267
848'
3,415
441
3,100
483
3,542
455
3,764
484
3,395
311
10,745
10,747
14,307
10,346
9,995
10,385
10,407
10,307
9,416
9,700
7 Banks' custody liabilities4
8
U.S. Treasury bills and certificates 5
9 Other negotiable and readily transferable
instruments 6
10 Other
11 Nonmonetary international and regional
organizations7
1? Banks' own liabilities
Demand deposits
n
14 Time deposits 1
15 Other 2
16 Banks' custody liabilities4
17 U.S. Treasury bills and certificates
18 Other negotiable and readily transferable
instruments 6
19 Other
36 Banks' custody liabilities4
37
U.S. Treasury bills and certificates
38 Other negotiable6 and readily transferable
instruments
39 Other
45 Banks' custody liabilities4
46
U.S. Treasury bills and certificates
47 Other negotiable and readily transferable
instruments 6
48 Other
49 MEMO: Negotiable time certificates of
deposit in custody for foreigners
1. Excludes negotiable time certificates of deposit, which are included in
"Other negotiable and readily transferable instruments."
2. Includes borrowing under repurchase agreements.
3. U.S. banks: includes amounts due to own foreign branches and foreign
subsidiaries consolidated in "Consolidated Report of Condition" filed with bank
regulatory agencies. Agencies, branches, and majority-owned subsidiaries of
foreign banks: principally amounts due to head office or parent foreign bank, and
foreign branches, agencies or wholly owned subsidiaries of head office or parent
foreign bank.
4. Financial claims on residents of the United States, other than long-term
securities, held by or through reporting banks.
5. Includes nonmarketable certificates of indebtedness and Treasury bills
issued to official institutions of foreign countries.
6. Principally bankers acceptances, commercial paper, and negotiable time
certificates of deposit.
7. Principally the International Bank for Reconstruction and Development, and
the Inter-American and Asian Development Banks.
8. Foreign central banks and foreign central governments, and the Bank for
International Settlements.
9. Excludes central banks, which are included in "Official institutions."
• Liabilities and claims of banks in the United States were increased,
beginning in December 1981, by the shift from foreign branches to international
banking facilities in the United States of liabilities to, and claims on, foreign
residents.
A56
3.17
International Statistics • May 1984
Continued
1983
Area and country
1980
1981A
1984
1982
Sept.
Oct.
r
Nov.
Dec.
Jan.
Feb.
Mar .P
1 Total
205,297
243,889
307,056
338,026
338,117'
351,382'
369,226'
358,486'
368,502
376,457
2 Foreign countries
202,953
241,168
302,134
332,718r
333,498'
345,019'
363,269'
353,726'
361,671
370,204
90,897
523
4,019
497
455
12,125
9,973
670
7,572
2,441
1,344
374
1,500
1,737
16,689
242
22,680
681
6,939
68
370
91,275
596
4,117
333
296
8,486
7,645
463
7,267
2,823
1,457
354
916
1,545
18,716
518
28,286
375
6,541
49
493
117,756
519
2,517
509
748
8,171
5,351
537
5,626
3,362
1,567
388
1,405
1,390
29,066
296
48,172
499
7,006
50
576
125,969'
659
2,795
593
373
8,827
3,438
604
6,931
3,892
1,457
302
1,678
1,337
29,94C
333
55,708r
506
6,048'
23
525
127,131'
570
2,856'
544
372
8,638
4,307
595
7,703
3,735
1,072
297
1,592
1,489
30,822'
277
55,082'
464
6,102
37
576
130,671"
641
2,470'
538
375
8,083
4,337
544
7,824'
3,701
1,531
306
1,534
1,652
30,623'
319
58,437'
552
6,660
27
518
138,006
585
2,709
466
531
9,441
3,599
520
8,459
4,290
1,673
373
1,603
1,799
32,117
467
60,658
562
7,493
65
596
134,887'
755'
2,972'
372
298
8,122'
3,823'
513
7,622
4,008
1,481
377
1,645
1,896'
31,956'
334
61,794'
505
5,872
62
482'
140,029
763
3,211
385
398
10,098
4,582
513
7,638
4,200
1,452
352
1,664
1,752
32,237
400
64,404
477
4,965
74
464
141,936
3 Europe
4 Austria
5 Belgium-Luxembourg
6 Denmark
7 Finland
8 France
9 Germany
10 Greece
11 Italy
12 Netherlands
13 Norway
14 Portugal
15 Spain
lb
Sweden
17 Switzerland
18 Turkey
19 United Kingdom
20 Yugoslavia
21 Other Western Europe 1
22 U.S.S.R
23 Other Eastern Europe 2
861
3,365
285
287
10,713
4,863
503
7,395
4,423
1,285
403
1,759
1,835
32,266
335
64,627
478
5,607
177
468
24 Canada
10,031
10,250
12,232
16,470
16,335'
16,369'
16,026'
16,27c
17,679
17,224
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
Venezuela
42
43 Other Latin America and Caribbean
53,170
2,132
16,381
670
1,216
12,766
460
3,077
6
371
367
97
4,547
413
4,718
403
254
3,170
2,123
85,223
2,445
34,856
765
1,568
17,794
664
2,993
9
434
479
87
7,235
3,182
4,857
694
367
4,245
2,548
114,163
3,578
44,744
1,572
2,014
26,381
1,626
2,594
9
455
670
126
8,377
3,597
4,805
1,147
759
8,417
3,291
126,709'
4,148
49.52C
2,706'
3,406
28,520'
1,616'
1,611
10
670
758
109
9,702'
3,586'
6,084'
1,203
1,116
8,385'
3,561
126,640'
4,018
50,496'
2,632
3,818
27,466'
1,697
1,617
10
825
750
105
9,449
3,888'
5,902
1,049
1,202
8,202
3,513
134,139'
4,377
53,703'
2,582
4,150
30,624'
1,783
1,645
10
1,003
766
234
9,463
3,941
5,946'
1,090
1,173
8,024
3,626
140,033'
4,011
55,877'
2,328
3,158'
34,431'
1,842
1,689
8
1,047
788
109
10,389
3,879
5,924
1,166
1,232
8,603
3,551
135,671'
4,303
52,314'
2,745
2,997
32,531'
1,811
1,584
9
828
800
113
10,994
3,773
5,586'
1,130
1,278
9,313
3,562'
138,168
4,536
52,779
3,165
3,473
32,297
1,935
1,840
13
826
812
131
10,693
4,501
5,545
1,146
1,321
9,442
3,712
143,127
4,365
58,161
2,903
3,725
32,353
1,876
1,656
20
825
815
596
10,215
4,895
5,608
1,157
1,418
8,565
3,972
44
42,420
49,822
48,716
54,948'
53,871'
54,278'
58,351
56,002'
55,274
57,510
49
1,662
2,548
416
730
883
16,281
1,528
919
464
14,453
2,487
158
2,082
3,950
385
640
592
20,750
2,013
874
534
12,992
4,853
203
2,761
4,465
433
857
606
16,078
1,692
770
629
13,433
6,789
190
3,852
6,586'
712
622
848
17,455'
1,478
1,181
581
12,975'
8,468'
216
3,992
6,511'
830
871
812
17,140'
1,353
747
522
12.86C
8,017'
183
4,063
6,971
725
661
808
17,138
1,591
1,012
569
12,650'
7,907
249
3,997
6,610
464
997
1,722
18,079
1,648
1,234
716
12,960
9,676
249
4,27 C
6,1%'
670
1,093
786'
17,069'
1,614
1,235
776
12,516'
9,528
168
4,291
5,884
749
859
733
17,615
1,542
1,280
622
11,587
9,943
272
4,165
6,402
686
758
830
19,018
1,748
1,259
714
12,185
9,473
57 Africa
58 Egypt
59 Morocco
60 South Africa
61 Zaire
62 Oil-exporting countries 4
63 Other Africa
5,187
485
33
288
57
3,540
783
3,180
360
32
420
26
1,395
946
3,124
432
81
292
23
1,280
1,016
3,132
488
84
520
34
963
1,042
2,845
576
73
394
43
736
1,023
2,694
589
96
389
32
679
909
2,800
645
84
449
87
620
917
2,917
572
109
486
61
869
821
3,070
568
138
502
66
839
957
3,096
547
122
538
77
892
920
64 Other countries
65 Australia
66 All other
1,247
950
297
1,419
1,223
196
6,143
5,904
239
5,490
5,284
206
6,675
6,461
214
6,868
6,666
202
8,053
7,857
196
7,979
7,742
237
7,451
7,197
255
7,310
7,091
220
67 Nonmonetary international and regional
organizations
International
Latin American regional
Other regional5
2,344
1,157
890
296
2,721
1,661
710
350
4,922
4,049
517
357
5,308
4,674
445
189
4,619
3,944
437
238
6,363'
5,598'
415
350
5,957
5,273
419
265
4,759
4,174
433
152
6,831
6,189
457
186
6,253
5,426
451
376
45
46
47
48
49
50
51
52
53
54
55
56
China
Mainland
Taiwan
Hong Kong
India
Indonesia
Israel
Japan
Korea
Philippines
Thailand
Middle-East oil-exporting countries 3
Other Asia
68
69
70
1. Includes the Bank for International Settlements. Beginning April 1978, also
includes Eastern European countries not listed in line 23.
2. Beginning April 1978 comprises Bulgaria, Czechoslovakia, the German
Democratic Republic, Hungary, Poland, and Romania.
3. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
4. Comprises Algeria, Gabon, Libya, and Nigeria.
5. Asian, African, Middle Eastern, and European regional organizations,
except the Bank for International Settlements, which is included in "Other
Western Europe."
• Liabilities and claims of banks in the United States were increased, beginning
in December 1981, by the shift from foreign branches to international banking
facilities in the United States of liabilities to, and claims on, foreign residents.
Nonbank-Reported
3.18
Data
A57
BANKS' OWN CLAIMS ON FOREIGNERS Reported by Banks in the United States
Payable in U.S. Dollars
Millions of dollars, end of period
1983
Area and country
1980
1981A
1984
1982
Sept/
Nov/
Oct/
Dec/
Jan/
Feb.
Mar."
1 Total
172,592
251,589
355,705
376,847
373,311
375,118
387,710
372,146
376,349
383,928
2 Foreign countries
172,514
251,533
355,636
376,249
373,251
375,048
387,547
372,081
376,185
383,778
32,108
236
1,621
127
460
2,958
948
256
3,364
575
227
331
993
783
1,446
145
14,917
853
179
281
1,410
49,262
121
2,849
187
546
4,127
940
333
5,240
682
384
529
2,095
1,205
2,213
424
23,849
1,225
211
377
1,725
85,584
229
5,138
554
990
7,251
1,876
452
7,560
1,425
572
950
3,744
3,038
1,639
560
45,781
1,430
368
263
1,762
91,041
351
5,673
1,135
697
7,869
1,428
411
7,083
1,189
550
861
3,402
3,081
1,781
616
51,183
1,369
536
219
1,606
89,145
334
5,533
1,107
789
7,457
1,095
372
7,713
1,071
575
893
3,162
3,059
1,625
660
50,041
1,468
405
211
1,575
90,243
395
5,548
1,272
822
7,942
1,256
412
8,459
1,396
590
891
3,654
3,249
2,114
693
47,762
1,582
429
173
1,603
90,743
401
5,639
1,275
1,044
8,761
1,294
476
9,013
1,302
690
939
3,573
3,358
1,856
812
46,372
1,673
477
192
1,598
90,378
354
5,942
1,296
945
7,984
1,058
508
7,869
1,407
652
954
3,391
3,373
1,452
795
48,488
1,718
493
162
1,537
91,374
414
6,182
1,244
952
8,309
1,034
549
7,899
1,318
645
944
3,277
3,356
1,302
879
49,177
1,702
547
169
1,475
91,003
466
5,943
1,252
911
8,390
1,108
694
8,095
1,324
625
908
3,429
3,403
1,431
958
48,099
1,700
522
201
1,543
4
5
6
7
8
9
10
11
1?
13
14
15
16
17
18
19
20
71
77
23
Europe
Austria
Belgium-Luxembourg
Denmark
Finland
France
Germany
Greece
Italy
Netherlands
Norway
Portugal
Spain
Sweden
Switzerland
Turkey
United Kingdom
Yugoslavia
Other Western Europe 1
U.S.S.R
Other Eastern Europe 2
4,810
9,193
13,678
16,578
15,892
16,382
16,330
15,868
15,975
17,200
75 Latin America and Caribbean
76 Argentina
77 Bahamas
78
Bermuda
79 Brazil
30
British West Indies
31
Chile
3?
Colombia
33 Cuba
Ecuador
34
35 Guatemala 3
36 Jamaica 3
37 Mexico
38 Netherlands Antilles
39 Panama
Peru
40
Uruguay
41
Venezuela
4?
43 Other Latin America and Caribbean
92,992
5,689
29,419
218
10,496
15,663
1,951
1,752
3
1,190
137
36
12,595
821
4,974
890
137
5,438
1,583
138,347
7,527
43,542
346
16,926
21,981
3,690
2,018
3
1,531
124
62
22,439
1,076
6,794
1,218
157
7,069
1,844
187,969
10,974
56,649
603
23,271
29,101
5,513
3,211
3
2,062
124
181
29,552
839
10,210
2,357
686
10,643
1,991
195,069
11,464
55,179
564
24.340
31,202
5,808
3,670
0
2,006
112
214
33,798
917
9,206
2,470
857
11,046
2,217
194,991
11,638
55,756
477
24,232
31,005
5,756
3,653
3
2,141
115
203
33,562
1,033
8,835
2,434
883
10,888
2,377
197,785
11,899
56,131
620
24,532
32,251
5,860
3,734
0
2,262
122
210
33,729
1,186
8,336
2,469
903
11,086
2,455
203,269
11,740
58,351
566
24,482
34,921
6,029
3,745
0
2,307
129
215
34,710
1,154
7,848
2,536
977
11,287
2,271
193,898
11,746
52,586
644
24,826
31,171
6,163
3,695
0
2,367
189
218
34,547
971
7,847
2,467
982
11,247
2,232
196,953
11,751
53,167
409
24,928
32,874
6,286
3,536
0
2,350
126
219
34,680
1,043
8,794
2,415
908
11,168
2,298
201,717
11,614
57,303
531
25,646
32,901
6,121
3,672
0
2,333
128
210
34,551
1,189
8,494
2,460
926
11,130
2,510
44
39,078
49,851
60,952
64,783
63,949
61,286
67,648
62,655
62,018
64,206
195
2,469
2,247
142
245
1,172
21,361
5,697
989
876
1,432
2,252
107
2,461
4,132
123
352
1,567
26,797
7,340
1,819
565
1,581
3,009
214
2,288
6,787
222
348
2,029
28,379
9,387
2,625
643
3,087
4,943
227
1,829
8,711
259
695
1,726
28,547
9,648
2,779
806
4,155
5,402
295
1,618
8,337
324
704
1,780
28,280
9,324
2,376
831
4,689
5,390
249
1,574
8,758
305
711
1,817
25,829
9,629
2,427
867
4,276
4,845
292
1,908
8,429
330
805
1,795
30,573
9,891
2,099
1,021
4,954
5,549
420
1,820
8,129
344
853
1,556
27,333
9,489
2,408
1,021
4,637
4,646
337
1,709
7,509
253
899
1,478
27,894
9,435
2,354
1,035
4,261
4,853
350
1,666
7,714
327
934
1,586
28,247
9,793
2,359
966
5,050
5,215
57 Africa
58 Egypt
59 Morocco
South Africa
60
61
Zaire
67
Oil-exporting countries 5
Other
63
2,377
151
223
370
94
805
734
3,503
238
284
1,011
112
657
1,201
5,346
322
353
2,012
57
801
1,802
6,501
610
444
2,719
38
964
1,727
6,910
642
462
2,578
38
1,485
1,705
6,830
692
461
2,892
37
1,039
1,709
6,654
747
440
2,634
33
1,073
1,727
6,571
738
450
2,684
29
1,037
1,631
7,154
709
481
2,868
16
1,124
1,955
6,900
744
474
2,967
14
1,026
1,676
64 Other countries
65
Australia
66
All other
1,150
859
290
1,376
1,203
172
2,107
1,713
394
2,276
1,683
593
2,365
1,701
664
2,522
1,899
624
2,904
2,272
632
2,712
2,105
607
2,712
2,043
669
2,751
2,013
738
78
56
68
598
60
70
164
64
164
150
24 Canada
45
46
47
48
49
50
St
57
53
54
5S
56
China
Mainland
Taiwan
Hong Kong
India
Indonesia
Israel
Japan
Korea
Philippines
Thailand
Middle East oil-exporting countries 4
Other Asia
67 Nonmonetary international and regional
organizations 6
1. Includes the Bank for International Settlements. Beginning April 1978, also
includes Eastern European countries not listed in line 23.
2. Beginning April 1978 comprises Bulgaria, Czechoslovakia, the German
Democratic Republic, Hungary, Poland, and Romania.
3. Included in "Other Latin America and Caribbean" through March 1978.
4. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
5. Comprises Algeria, Gabon, Libya, and Nigeria.
6. Excludes the Bank for International Settlements, which is included in
"Other Western Europe."
NOTE. Data for period before April 1978 include claims of banks' domestic
customers on foreigners.
A Liabilities and claims of banks in the United States were increased,
beginning in December 1981, by the shift from foreign branches to international
banking facilities in the United States of liabilities to, and claims on, foreign
residents.
A58
3.19
International Statistics • May 1984
BANKS' OWN AND DOMESTIC CUSTOMERS' CLAIMS ON FOREIGNERS Reported by Banks in the
United States
Payable in U.S. Dollars
Millions of dollars, end of period
1983
Type of claim
1980
1981A
1984
1982
Oct/
Nov/
373,311
54,954
141,655
115,021
44,697
70,324
61,681
375,118
56,026
137,520
118,619
44,738
73,881
62,952
Sept/
Dec/
1 Total
198,698
287,557
396,015
412,944
2
3
4
5
6
7
8
172,592
20,882
65,084
50,168
8,254
41,914
36,459
251,589
31,260
96,653
74,704
23,381
51,322
48,972
355,705
45,422
127,293
121,377
44,223
77,153
61,614
376,847
54,379
137,609
122,455
48,709
73.746
62,404
26,106
885
35,968
1,378
40,310
2,491
36,097
2,654
33,943
2,969
15,574
26,352
30,763
27,550
25,104
9,648
8,238
7,056
5,892
5,870
22,714
29,952
38,153
34,619
37,324
24,468
40,369
42,186
42,529
Banks' own claims on foreigners
Foreign public borrowers
Own foreign offices'
Unaffiliated foreign banks
Deposits
Other
All other foreigners
9 Claims of banks' domestic customers 2
Jan/
Feb.
Mar.P
421,653
387,710
57,255
144,016
122,779
46,392
76,387
63,661
372,146
58,115
138,377
115,211
43,092
72,119
60,442
376,349
58,540
140,654
116,176
44,622
71,555
60,979
44,845
47,141
383,928
57,914
145,452
119,356
45,488
73,868
61,206
11 Negotiable and readily transferable
12 Outstanding collections and other
13 MEMO: Customer liability on
Dollar deposits in banks abroad, reported by nonbanking business enterprises in the United States 4 . . .
1. U.S. banks: includes amounts due from own foreign branches and foreign
subsidiaries consolidated in "Consolidated Report of Condition" filed with bank
regulatory agencies. Agencies, branches, and majority-owned subsidiaries of
foreign banks: principally amounts due from head office or parent foreign bank,
and foreign branches, agencies, or wholly owned subsidiaries of head office or
parent foreign bank.
2. Assets owned by customers of the reporting bank located in the United
States that represent claims on foreigners held by reporting banks for the account
of their domestic customers.
3. Principally negotiable time certificates of deposit and bankers acceptances.
3.20
45,185
47,922
44,325
n.a.
4. Includes demand and time deposits and negotiable and nonnegotiable
certificates of deposit denominated in U.S. dollars issued by banks abroad. For
description of changes in data reported by nonbanks, see July 1979 BULLETIN,
p. 550.
• Liabilities and claims of banks in the United States were increased,
beginning in December 1981, by the shift from foreign branches to international
banking facilities in the United States of liabilities to, and claims on, foreign
residents.
NOTE. Beginning April 1978, data for banks' own claims are given on a monthly
basis, but the data for claims of banks' own domestic customers are available on a
quarterly basis only.
BANKS' OWN CLAIMS ON UNAFFILIATED FOREIGNERS Reported by Banks in the United States
Payable in U.S. Dollars
Millions of dollars, end of period
1982
Maturity; by borrower and area
1
2
3
4
5
6
7
8
9
10
11
1?
13
By borrower
Maturity of 1 year or less'
Foreign public borrowers
All other foreigners
Maturity of over 1 year'
Foreign public borrowers
All other foreigners
By area
Maturity of 1 year or less'
Europe
Canada
Latin America and Caribbean
Africa
All other 2
Maturity of over 1 year'
14 Europe
15 Canada
16 Latin America and Caribbean
17
18 Africa
19 All other 2
1. Remaining time to maturity.
2. Includes nonmonetary international and regional organizations.
1980
1983
1981 •
Dec.
Mar/
June'
Sept/
Dec/
106,748
154,590
228,150
230,439
232,704
237,162
242,933
82,555
9,974
72,581
24,193
10,152
14,041
116,394
15,142
101,252
38,197
15,589
22,608
173,917
21,256
152,661
54,233
23,137
31,095
174,343
21,782
152,561
56,096
25,094
31,002
175,021
23,124
151,897
57,683
26,455
31,227
176,271
25,479
150,792
60,891
28,231
32,660
175,970
24,258
151,712
66,963
32,482
34,481
18,715
2,723
32,034
26,686
1,757
640
28,130
4,662
48,717
31,485
2,457
943
50,500
7,642
73,291
37,578
3,680
1,226
54,127
6,878
75,262
32,760
3,872
1,444
52,208
7,110
74,967
35,345
3,854
1,536
53,332
6,642
76,383
33,890
4,570
1,454
55,550
6,200
73,997
34,518
4,206
1,499
5,118
1,448
15,075
1,865
507
179
8,100
1,808
25,209
1,907
900
272
11,636
1,931
35,247
3,185
1,494
740
12,027
1,928
35,916
3,590
1,485
1,150
12,289
1,861
36,730
4,070
1,667
1,066
12,338
1,760
39,102
4,735
1,819
1,136
13,300
1,857
43,498
4,838
2,278
1,191
• Liabilities and claims of banks in the United States were increased,
beginning in December 1981, by the shift from foreign branches to international
banking facilities in the United States of liabilities to, and claims on, foreign
residents.
Nonbank-Reported
3.21
Data
A59
CLAIMS ON FOREIGN COUNTRIES Held by U.S. Offices and Foreign Branches of U.S.-Chartered Banks'
Billions of dollars, end of period
1982
Area or country
1979
1980
1983
1981
Mar.
June
Sept.
Dec.
Mar.
June
Sept.
Dec.
303.9
352.0
415.2
419.6
435.3
438.2
438.6
440.6
436.5
425.5
435.7
138.4
11.1
11.7
12.2
6.4
4.8
2.4
4.7
56.4
6.3
22.4
162.1
13.0
14.1
12.1
8.2
4.4
2.9
5.0
67.4
8.4
26.5
175.5
13.3
15.3
12.9
9.6
4.0
3.7
5.5
70.1
10.9
30.2
174.5
13.2
16.0
12.5
9.0
4.0
4.1
5.3
70.3
11.6
28.5
176.3
14.1
16.5
12.7
9.0
4.1
4.0
5.1
69.4
11.4
29.9
175.4
13.6
15.8
12.2
9.7
3.8
4.7
5.1
70.3
11.0
29.3
179.7
13.1
17.1
12.7
10.3
3.6
5.0
5.0
72.1
10.4
30.2
182.1
13.7
17.1
13.4
10.2
4.3
4.3
4.6
72.9
12.4
29.2
176.7
13.3
17.1
12.6
10.5
4.0
4.7
4.8
70.2
10.8
28.7
167.8
12.6
16.2
11.6
9.9
3.6
4.9
4.2
67.0
9.0
28.9
167.1
12.4
16.3
11.4
11.7
3.5
5.1
4.3
64.1
8.3
30.0
13 Other developed countries
14 Austria
15 Denmark
16 Finland
17 Greece
18 Norway
19 Portugal
20 Spain
21 Turkey
22
Other Western Europe
73 South Africa
24 Australia
19.9
2.0
2.2
1.2
2.4
2.3
.7
3.5
1.4
1.4
1.3
1.3
21.6
1.9
2.3
1.4
2.8
2.6
.6
4.4
1.5
1.7
1.1
1.3
28.4
1.9
2.3
1.7
2.8
3.1
1.1
6.6
1.4
2.1
2.8
2.5
30.7
2.1
2.5
1.6
2.9
3.2
1.2
7.2
1.6
2.1
3.3
3.0
32.1
2.1
2.6
1.6
2.7
3.2
1.5
7.3
1.5
2.2
3.5
4.0
32.7
2.0
2.5
1.8
2.6
3.4
1.6
7.7
1.5
2.1
3.6
4.0
33.7
1.9
2.4
2.2
3.0
3.3
1.5
7.5
1.4
2.3
3.7
4.4
33.9
2.1
3.3 .
2.1
2.9
3.3
1.4
7.0
1.5
2.2
3.6
4.6
34.4
2.1
3.4
2.1
2.9
3.4
1.4
7.2
1.4
2.0
3.9
4.5
34.1
1.9
3.3
1.8
2.9
3.2
1.3
7.1
1.5
2.1
4.7
4.4
36.0
1.9
3.5
2.4
2.8
3.2
1.3
7.2
1.7
1.9
4.7
5.5
25 OPEC countries 2
26 Ecuador
27 Venezuela
28 Indonesia
29 Middle East countries
30 African countries
22.9
1.7
8.7
1.9
8.0
2.6
22.7
2.1
9.1
1.8
6.9
2.8
24.8
2.2
9.9
2.6
7.5
2.5
25.4
2.3
10.0
2.7
8.2
2.2
26.4
2.4
10.1
2.8
8.7
2.5
27.3
2.3
10.4
2.9
9.0
2.7
27.4
2.2
10.5
3.2
8.7
2.8
28.5
2.2
10.4
3.5
9.3
3.0
28.2
2.2
10.4
3.2
9.5
3.0
27.2
2.1
9.8
3.4
9.0
2.8
29.1
2.2
9.9
3.8
10.0
3.1
31 Non-OPEC developing countries
63.0
77.4
96.3
97.5
103.6
104.0
107.0
107.6
108.2
108.8
111.1
5.0
15.2
2.5
2.2
12.0
1.5
3.7
7.9
16.2
3.7
2.6
15.9
1.8
3.9
9.4
19.1
5.8
2.6
21.6
2.0
4.1
10.0
19.7
6.0
2.3
22.9
1.9
4.1
9.6
21.4
6.4
2.6
25.2
2.5
4.0
9.2
22.4
6.2
2.8
25.0
2.6
4.3
8.9
22.9
6.3
3.1
24.5
2.6
4.0
9.0
23.1
6.0
2.9
25.1
2.4
4.2
9.4
22.5
5.8
3.2
25.2
2.6
4.3
9.5
22.9
6.2
3.2
25.8
2.4
4.2
9.6
23.0
6.5
3.2
26.1
2.4
4.3
39
40
41
4?
43
44
45
46
47
Asia
China
Mainland
Taiwan
India
Israel
Korea (South)
Malaysia
Philippines
Thailand
Other Asia
.1
3.4
.2
1.3
5.4
1.0
4.2
1.5
.5
.2
4.2
.3
1.5
7.1
1.1
5.1
1.6
.6
.2
5.1
.3
2.1
9.4
1.7
6.0
1.5
1.0
.2
5.1
.5
1.7
8.6
1.7
5.9
1.4
1.2
.3
5.0
.5
2.2
8.9
1.9
6.3
1.3
1.1
.2
4.9
.5
1.9
9.3
1.8
6.0
1.3
1.3
.2
5.2
.6
2.3
10.8
2.1
6.3
1.6
1.1
.2
5.1
.4
2.0
10.8
2.5
6.6
1.6
1.4
.2
5.1
.5
2.3
10.8
2.6
6.4
1.8
1.2
.2
5.2
.5
1.7
10.8
2.8
6.2
1.7
1.0
.3
5.3
.6
1.8
11.3
2.9
6.2
1.9
1.0
48
49
50
51
Africa
Egypt
Morocco
Zaire
Other Africa 3
.6
.6
.2
1.7
.8
.7
.2
2.1
1.1
.7
.2
2.3
1.3
.7
.2
2.3
1.3
.7
.2
2.3
1.3
.8
.1
2.2
1.2
.7
.1
2.4
1.1
.8
.1
2.3
1.3
.8
.1
2.2
1.4
.8
.1
2.4
1.4
.8
.1
2.3
52 Eastern Europe
53 U.S.S.R
54 Yugoslavia
55 Other
7.3
.7
1.8
4.8
7.4
.4
2.3
4.6
7.8
.6
2.5
4.7
7.2
.4
2.5
4.3
6.7
.4
2.4
3.9
6.3
.3
2.2
3.8
6.2
.3
2.2
3.7
5.8
.3
2.2
3.3
5.7
.4
2.3
3.0
5.3
.2
2.3
2.8
5.4
.2
2.4
2.8
56 Offshore banking centers
57 Bahamas
58 Bermuda
59 Cayman Islands and other British West Indies
60 Netherlands Antilles
61
Panama 4
62
Lebanon
63 Hong Kong
64
Singapore
65 Others 5
40.4
13.7
.8
9.4
1.2
4.3
.2
6.0
4.5
.4
47.0
13.7
.6
10.6
2.1
5.4
.2
8.1
5.9
.3
63.7
19.0
.7
12.4
3.2
7.7
.2
11.8
8.7
.1
65.7
20.2
.7
12.1
3.2
7.2
.2
12.9
9.3
.1
72.0
24.1
.7
12.3
3.0
7.4
.2
14.3
9.9
.1
72.1
21.4
.8
13.6
3.3
8.1
.1
15.0
9.8
.0
66.8
19.0
.9
12.9
3.3
7.6
.1
13.9
9.1
.0
66.1
17.3
1.0
11.9
3.1
7.1
.1
15.2
10.3
.0
67.3
19.5
.8
12.1
2.6
6.6
.1
14.5
11.0
.0
65.5
19.0
.8
10.2
4.1
5.7
.1
15.1
10.4
.1
70.2
21.9
.9
12.0
4.1
6.0
.1
14.9
10.2
.0
66 Miscellaneous and unallocated 6
11.7
14.0
18.8
18.5
18.4
20.3
17.9
16.7
16.1
16.8
16.8
1
2 G-10 countries and Switzerland
3 Belgium-Luxembourg
4
France
5 Germany
6
7
Netherlands
8 Sweden
9
Switzerland
10 United Kingdom
11 Canada
12 Japan
3?
33
34
35
36
37
38
Latin America
Argentina
Brazil
Chile
Colombia
Mexico
Other Latin America
1. The banking offices covered by these data are the U.S. offices and foreign
branches of U.S.-owned banks and of U.S. subsidiaries of foreign-owned banks.
Offices not covered include (1) U.S. agencies and branches of foreign banks, and
(2) foreign subsidiaries of U.S. banks. To minimize duplication, the data are
adjusted to exclude the claims on foreign branches held by a U.S. office or another
foreign branch of the same banking institution. The data in this table combine
foreign branch claims in table 3.14 (the sum of lines 7 through 10) with the claims
of U.S. offices in table 3.18 (excluding those held by agencies and branches of
foreign banks and those constituting claims on own foreign branches).
2. Besides the Organization of Petroleum Exporting Countries shown individually, this group includes other members of OPEC (Algeria, Gabon, Iran, Iraq,
Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, and United Arab Emirates) as well
as Bahrain and Oman (not formally members of OPEC).
3. Excludes Liberia.
4. Includes Canal Zone beginning December 1979.
5. Foreign branch claims only.
6. Includes New Zealand, Liberia, and international and regional organizations.
A60
International Statistics • May 1984
3.22
LIABILITIES TO UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the
United States'
Millions of dollars, end of period
1982
Type, and area or country
1980
1981
1983
1982
Dec.
Mar.
June
Sept.
Dec.P
1 Total
29,434
28,618
25,568
25,568
23,285
22,531
24,595
23,571
2 Payable in dollars
3 Payable in foreign currencies
25,689
3,745
24,909
3,709
22,375
3,193
22,375
3,193
20,302
2,983
19,625
2,906
21,728
2,867
20,484
3,087
By type
4 Financial liabilities
5
Payable in dollars
6
Payable in foreign currencies
11,330
8,528
2,802
12,157
9,499
2,658
10,906
8,734
2,172
10,906
8,734
2,172
10,831
8,795
2,036
10,866
8,823
2,043
10,779
8,809
1,971
10,383
8,504
1,879
7 Commercial liabilities
8
Trade payables
9
Advance receipts and other liabilities
18,104
12,201
5,903
16,461
10,818
5,643
14,662
7,707
6,955
14,662
7,707
6,955
12,454
5,627
6,827
11,665
6,026
5,640
13,815
7,056
6,760
13,189
6,496
6,693
17,161
943
15,409
1,052
13,641
1,021
13,641
1,021
11,507
947
10,802
864
12,919
896
11,980
1,208
6,481
479
327
582
681
354
3,923
6,825
471
709
491
748
715
3,565
6,369
505
731
470
711
753
3,070
6,369
505
731
470
711
753
3,070
6,233
410
725
487
699
702
3,081
6,220
436
756
460
728
621
3,069
5,978
379
785
454
730
530
2,943
5,715
302
820
505
581
525
2,834
10
11
12
13
14
15
16
17
18
Payable in dollars
Payable in foreign currencies
By area or country
Financial liabilities
Europe
Belgium-Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
19
Canada
20
21
22
23
24
25
26
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
27
28
29
30
31
32
33
34
35
36
37
38
39
964
963
746
746
733
865
788
770
3,136
964
1
23
1,452
99
81
3,356
1,279
7
22
1,241
102
98
2,724
899
14
28
1,010
121
114
2,724
899
14
28
1,010
121
114
2,707
827
18
39
1,009
149
121
2,435
695
10
34
932
151
124
2,658
771
13
32
972
185
117
2,541
749
13
32
896
215
124
723
644
38
976
792
75
1,039
715
169
1,039
715
169
1,124
781
168
1,319
943
205
1,322
957
201
1,330
962
170
Africa
Oil-exporting countries 3
11
1
14
0
17
0
17
0
20
0
17
0
19
0
18
0
All other 4
15
24
12
12
13
9
15
10
4,402
90
582
679
219
499
1,209
3,770
71
573
545
220
424
880
3,649
52
597
467
346
363
850
3,649
52
597
467
346
363
850
3,443
45
578
455
351
354
679
3,368
41
617
439
342
357
633
3,384
47
506
461
243
448
786
3,122
62
436
436
275
232
605
Japan
Middle East oil-exporting countries 2
Commercial liabilities
Europe
Belgium-Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
40
Canada
41
42
43
44
45
46
47
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
48
49
50
Japan
Middle East oil-exporting countries 2 - 5
888
897
1,490
1,490
1,433
1,465
1,407
1,827
1,300
8
75
111
35
367
319
1,044
2
67
67
2
340
276
1,008
16
89
60
32
379
165
1,008
16
89
60
32
379
165
1,066
4
117
51
4
355
198
1024
1
76
49
22
399
236
1,067
1
76
48
14
429
217
1,063
1
63
44
6
491
166
10,242
802
8,098
9,384
1,094
7,008
7,160
1,226
4,531
7,160
1,226
4,531
5,437
1,235
2,803
4,799
1,236
2,294
6,852
1,294
4,072
6,040
1,234
3,498
51
52
Africa
Oil-exporting countries 3
817
517
703
344
704
277
704
277
497
158
492
167
506
204
446
157
53
All other 4
456
664
651
651
578
518
600
690
1. For a description of the changes in the International Statistics tables, see
July 1979 BULLETIN, p. 550.
2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
3. Comprises Algeria, Gabon, Libya, and Nigeria.
4. Includes nonmonetary international and regional organizations.
5. Revisions include a reclassification of transactions, which also affects the
totals for Asia and the grand totals.
Nonbank-Reported
3.23
CLAIMS ON UNAFFILIATED FOREIGNERS
United States 1
Data
A61
Reported by Nonbanking Business Enterprises in the
Millions of dollars, end of period
1982
Type, and area or country
1983
1982
1981
1980
Dec.
Mar.
Sept.
June
Dec.''
1 Total
34,482
36,185
28,411
28,411
31,189
31,421
31,656'
33,329
2 Payable in dollars
3 Payable in foreign currencies
31,528
2,955
32,582
3,603
25,784
2,628
25,784
2,628
28,472
2,718
28,778
2,643
28.78C
2,877
30,169
3,160
By type
4 Financial claims
5 Deposits
6
Payable in dollars
7
Payable in foreign currencies
8 Other financial claims
9
Payable in dollars
10
Payable in foreign currencies
19,763
14,166
13,381
785
5,597
3,914
1,683
21,142
15,081
14,456
625
6,061
3,599
2,462
17,429
12,893
12,467
426
4,536
2,895
1,641
17,429
12,893
12,467
426
4,536
2,895
1,641
20,220
15,569
15,092
478
4,651
3,006
1,645
20,812
15,976
15,549
426
4,836
3,238
1,598
20,831
15,987
15,542
445
4,845
3,019
1,826
22,299
17,318
16,821
497
4,981
2,919
2,062
11 Commercial claims
12 Trade receivables
13 Advance payments and other claims
14,720
13,960
759
15,043
14,007
1,036
10,982
9,973
1,010
10,982
9,973
1,010
10,969
9,765
1,203
10,609
9,241
1,367
10,825'
9,526'
1,299
11,030
9,655
1,375
14
15
14,233
487
14,527
516
10,422
561
10,422
561
10,374
595
9,991
618
10,219'
606
10,429
601
6,069
145
298
230
51
54
4,987
4,596
43
285
224
50
117
3,546
4,835
10
134
178
97
107
4,044
4,835
10
134
178
97
107
4,044
6,196
58
98
127
140
107
5,414
6,817
12
140
217
136
37
6,040
6,202
25
135
151
89
34
5,547
6,423
37
130
129
49
38
5,768
5,036
6,755
4,287
4,287
4,613
4,881
4,958
5,759
7,811
3,477
135
96
2,755
208
137
8,812
3,650
18
30
3,971
313
148
7,420
3,236
32
62
3,161
274
139
7,420
3,236
32
62
3,161
274
139
8,520
3,806
21
50
3,365
352
156
8,040
3,244
93
48
3,339
348
152
8,609
3,389
62
49
3,932
315
137
9,110
4,332
96
53
3,509
273
134
16
17
18
19
20
21
22
23
Payable in dollars
Payable in foreign currencies
By area or country
Financial claims
Europe
Belgium-Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
24
25
26
71
28
79
30
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
31
3?
33
Asia
Japan
Middle East oil-exporting countries 2
607
189
20
758
366
37
698
153
15
698
153
15
712
233
18
772
288
14
764
257
8
714
246
4
34
35
Africa
Oil-exporting countries 3
208
26
173
46
158
48
158
48
153
45
154
48
151
45
147
55
36
All other 4
32
48
31
31
25
149
148
145
5,544
233
1,129
599
318
354
929
5,405
234
776
561
299
431
985
3,777
150
473
356
347
339
808
3,777
150
473
356
347
339
808
3,594
140
489
424
309
227
754
3,410
144
499
364
242
303
739
3,349
131
486
381'
282
270
734
3,604
142
455
346
332
295
802
37
38
39
40
41
42
43
Commercial claims
Europe
Belgium-Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom
44
Canada
45
46
47
48
49
50
51
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
52
53
54
Japan
Middle East oil-exporting countries 2
914
967
632
632
648
716
788
822
3,766
21
108
861
34
1,102
410
3,479
12
223
668
12
1,022
424
2,521
21
259
258
12
774
351
2,521
21
259
258
12
774
351
2,699
30
172
402
21
894
288
2,722
30
108
512
21
956
273
2,864
15
242
611
12
897
282
2,697
8
194
493
7
883
273
3,522
1,052
825
3,959
1,245
905
3,048
1,047
751
3,048
1,047
751
3,128
1,115
702
2,871
949
700
2,936'
1,037
719
3,045
1,091
737
588
140
588
140
559
131
528
130
562
131
584
139
417
417
342
361
326
277
55
56
Africa
Oil-exporting countries 3
653
153
772
152
57
All other 4
321
461
1. For a description of the changes in the International Statistics tables, see
July 1979 BULLETIN, p. 550.
2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
3. Comprises Algeria, Gabon, Libya, and Nigeria.
4. Includes nonmonetary international and regional organizations.
A62
3.24
International Statistics • May 1984
F O R E I G N T R A N S A C T I O N S IN S E C U R I T I E S
Millions of dollars
1984
Transactions, and area or country
1983
1984
1983r
1982
Jan.Mar.
Sept/
Nov.
Oct.
Dec.
Jan.
Feb.
Mar.''
U.S. corporate securities
STOCKS
1 Foreign purchases
2 Foreign sales
41,881
37,981
69,896
64,466
17,769
17,214
5,513
5,115
3 Net purchases, or sales ( - )
3,901
5,430
555
398
145'
4 Foreign countries
3,816
5,332
604
390
141'
2,530
-143
333
-63
-579
3,117
222
317
366
247
2
131
3,999
-97
1,045
-109
1,325
1,818
1,151
529
-807
394
42
24
311
-173
361
32
186
-130
708
181
-603
21
7
-20
257
-10
39
-49
123
174
154
107
-178
51
4
-6
-93'
-33'
55
-15
-18
-133'
124
-4C
49
103
-1
-1
-60'
-68'
53
24
-97
21
-1
14'
45
63
1
-3
85
98
-49
8
4
0
-7
21,639
20,188
23,976
23,076
6,138
6,084
1,900
1,960
2,537
2,492
2,039
1,304
20 Net purchases, or sales ( - )
1,451
900
54
-60
45
21 Foreign countries
1,479
885
34
-65
142
22
23
24
25
26
27
28
29
30
31
32
33
2,082
305
2,110
33
157
-589
24
159
-752
-22
-19
7
904
-89
286
51
632
438
123
100
-1,159
865
0
52
118
-7
46
36
-24
173
-35
-287
-28
267
0
0
26
0
41
1
-19
42
-10
4
-130
44
2
-2
-28
15
20
6
5
6
7
8
9
10
11
12
13
14
15
16
Europe
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
Latin America and Caribbean
Middle East 1
Other Asia
Africa
Other countries
17 Nonmonetary international and
regional organizations
5,534'
5,388'
4,853'
4,794'
6,020
5,745
5,445'
5,798
6,237
5,827
6,086
5,588
60'
275
-353'
410
498
59'
283
-342'
479
466
-278
-64
-51
13
-208
51
183
239
13
122
2
1
-160
-71
95
0
-92
-87
83
124
-361'
-48
5
16
146
-97
116
1
281
-168
324
43
-44
36
10
-34
325
-5
151
32
-4
125
301
14
-197
33
-7
-1
-11
-70
32
1,661
1,493
1,836'
1,775'
2,113
1,864
2,189
2,445
735
168
62'
248
-257
715
160
72'
161
-199
303
2
66
11
7
136
22
24
-249
45
0
-4
458
-31
53
5
15
390
46
-6
116
101
0
0
-87
-4
-10
3
78
-126
-22
20
42
207
0
0
72'
-1
-38
3
12
129'
1'
9
-26
18
-1
52
-5
-32
25
5
101
-10
16
30
75
-6
-1
117
9
-41
-58
-26
-312
-32
173
-97
20
7
BONDS 2
18 Foreign purchases
19 Foreign sales
Europe
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
Latin America and Caribbean
Middle East 1
Other Asia
Africa
Other countries
34 Nonmonetary international and
regional organizations
0
0
0
-2
3
-11
87
-57
Foreign securities
35 Stocks, net purchases, or sales ( - )
36 Foreign purchases
37 Foreign sales
-1,341
7,163
8,504
-3,867
13,143
17,010
355
4,231
3,877
-113
1,293
1,407
-13'
1,142'
1,155'
-31'
907'
939'
-190
1,126
1,317
-125'
1,197'
1,323
315
1,456
1,141
165
1,578
1,413
38 Bonds, net purchases, or sales ( - )
39 Foreign purchases
40
Foreign sales
-6,631
27,167
33,798
-3,694
35,669
39,363
27
11,924
11,897
-12
3,756
3,768
-202'
3,903'
4,105'
173
3,114'
2,940
-689
3,072
3,761
125'
3,273'
3,148'
-73
3,902
3,975
-26
4,748
4,774
41 Net purchases, or sales ( - ) , of stocks and bonds . . . .
-7,972
-7,561
381
-125
-215'
142'
-879
0'
242
139
42
43
44
45
46
47
48
49
-6,806
-2,584
-2,363
336
-1,822
-9
-364
-7,116
-5,713
-1,582
1,120
-914
141
-166
235
-643
-60
355
609
-26
0
-153
117
-355
23
105
16
-59
-264'
-367'
6
5
90
11
-10
38'
-426'
37
135
158'
1
133'
-719
-448
-64
17
-81
0
-143
-29'
-45'
-128'
114'
33'
-5
2
210
-407
184
188
255
-11
1
54
-191
-116
54
320
-10
-3
-1,165
-445
146
28
49
105
-161
32
85
Foreign countries
Europe
Canada
Latin America and Caribbean
Asia
Africa
Other countries
Nonmonetary international and
regional organizations
1. Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, Kuwait,
Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial States).
28
2. Includes state and local government securities, and securities of U.S.
government agencies and corporations. Also includes issues of new debt securities sold abroad by U.S. corporations organized to finance direct investments
abroad.
Investment
3.25
MARKETABLE U.S. TREASURY BONDS AND NOTES
Transactions
and Discount
Rates
A63
Foreign Holdings and Transactions
Millions of dollars
1984
1982
Country or area
1983
1984
1983
Jan.Mar.
Sept.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar. P
Holdings (end of period)1
85,220
88,94C
88,571'
90,938r
89,509'
88,94c
89,666'
90,244
89,741
80,637
83,82C
82,648'
84,283'
83,668'
83,82C
84,549'
84,415
84,463
3 Europe 2
4
Belgium-Luxembourg
5 Germany 2
6
Netherlands
7
Sweden
Switzerland 2
8
9
United Kingdom
10 Other Western Europe
11 Eastern Europe
12 Canada
29,284
447
14,841
2,754
677
1,540
6,549
2,476
0
602
35,537'
16
17,290
3,129
867r
1,118
8,524
4,592r
0
1,301
33,384'
58
16,156
3,034
691'
1,087
8,289
4,070'
0
1,063
34,469'
18
16,570
2,987
739'
1,177
8,629
4,350'
0
1,265
35,106'
2
17,092
3,048
783'
1,064
8,626
4,49c
0
1,225
35,537'
16
17,290
3,129
867'
1,118
8,524
4,592'
0
1,301
36,049'
33
17,581
3,113
898'
1,167
8,723
4,535'
0
1,298
37,394
50
18,527
3,052
918
1,206
8,608
5,034
0
1,310
37,324
57
18,837
3,023
960
1,252
8,427
4,768
0
1,090
13
14
15
16
17
18
19
20
1,076
188
656
232
49,543
11,578
77
55
863
64
716
83
46,00c
13,910
79
40
774
65
631
78
47,301'
13,210
79
48
695
66
540
89
47,720'
13,446
79
56
914
64
674
176
46,301'
13,600
79
43
863
64
716
83
46.00C
13,910
79
40
1,426
64
696
665
45,664'
14,012
79
33
840
64
574
201
44,768
14,351
78
25
563
64
504
-6
45,382
14,333
82
22
4,583
4,186
6
5,120'
4,404
6
5,923'
5,421
6
6,655'
6,094
6
5,841'
5,030
0
5,I2C
4,404
6
5,117'
4,467
6
5,829
5,139
6
5,278
4,613
6
1 Estimated total 2
2 Foreign countries
2
Latin America and Caribbean
Venezuela
Other Latin America and Caribbean
Netherlands Antilles
Asia
Japan
Africa
All other
21 Nonmonetary international and regional organizations
22 International
23 Latin American regional
Transactions (net purchases, or sales ( - ) during period)
24 Total2
25 Foreign countries 2
26 Official institutions
27 Other foreign 2
28 Nonmonetary international and regional organizations
MEMO: Oil-exporting countries
29 Middle East 3
30 Africa 4
14,972
3,720'
801
1,116'
2,367'
-576
726'
579
-503
16,072
14,550
1,518
-1,097
3,183'
806'
2,381'
531'
643
1,005
-363
157
-114'
-45'
-69'
1,230'
1,635'
51C
1,125'
732'
-615
-773'
158'
-808
152
-401
554
-729
729'
539'
189'
-3
-134
36
-169
711
48
431
-383
-551
7,575
-552
-5,424'
-1
-1,293
0
-305
0
-373
0
-968
0
-60
0
-801
0
23
0
1. Estimated official and private holdings of marketable U.S. Treasury securities with an original maturity of more than 1 year. Data are based on a benchmark
survey of holdings as of Jan. 31, 1971, and monthly transactions reports. Excludes
nonmarketable U.S. Treasury bonds and notes held by official institutions of
foreign countries.
3.26
-1,422
-515
0
2. Beginning December 1978, includes U.S. Treasury notes publicly issued to
private foreign residents denominated in foreign currencies.
3. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
4. Comprises Algeria, Gabon, Libya, and Nigeria.
DISCOUNT RATES OF FOREIGN CENTRAL BANKS
Percent per annum
Rate on Apr. 30, 1984
Rate on Apr. 30, 1984
Country
Country
Percent
4.25
11.0
49.0
10.84
7.0
Month
effective
Mar.
Feb.
Mar.
Apr.
Oct.
1984
1984
1981
1984
1983
Germany, Fed. Rep. of . . .
Italy
1. As of the end of February 1981, the rate is that at which the Bank of France
discounts Treasury bills for 7 to 10 days.
2. Minimum lending rate suspended as of Aug. 20, 1981.
NOTE. Rates shown are mainly those at which the central bank either discounts
Rate on Apr. 30, 1984
Country
Percent
Month
effective
Percent
Month
effective
12.0
4.0
16.0
5.0
5.0
Dec. 1983
Mar. 1983
Feb. 1984
Oct. 1983
Sept. 1983
8.0
4.0
June 1979
Mar. 1983
11.0
May 1983
or makes advances against eligible commercial paper and/or government commercial banks or brokers. For countries with more than one rate applicable to such
discounts or advances, the rate shown is the one at which it is understood the
central bank transacts the largest proportion of its credit operations.
A64
3.27
International Statistics • May 1984
FOREIGN SHORT-TERM INTEREST RATES
Percent per annum, averages of daily figures
1984
1983
Country, or type
1
2
3
4
5
6
7
8
9
10
1981
1982
1983
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
Eurodollars
United Kingdom
Canada
Germany
Switzerland
16.79
13.86
18.84
12.05
9.15
12.24
12.21
14.38
8.81
5.04
9.57
10.06
9.48
5.73
4.11
9.54
9.34
9.31
6.13
4.07
9.79
9.26
9.40
6.26
4.11
10.08
9.34
9.83
6.43
4.29
9.78
9.40
9.84
6.07
3.65
9.91
9.35
9.85
5.91
3.47
10.40
8.90
10.40
5.82
3.60
10.83
8.84
10.75
5.81
3.61
Netherlands
France
Italy
Belgium
Japan
11.52
15.28
19.98
15.28
7.58
8.26
14.61
19.99
14.10
6.84
5.58
12.44
18.95
10.51
6.49
6.07
12.42
17.51
9.44
6.52
6.17
12.31
17.71
9.89
6.35
6.20
12.16
17.75
10.50
6.45
6.01
12.22
17.75
10.68
6.35
5.95
12.36
17.40
11.43
6.34
6.09
12.53
17.28
12.02
6.41
6.04
12.46
17.38
11.66
6.26
NOTE. Rates are for 3-month interbank loans except for Canada, finance company paper; Belgium, 3-month Treasury bills; and Japan, Gensaki rate.
3.28
FOREIGN EXCHANGE RATES
Currency units per dollar
1984
1983
Country/currency
1981
1982
1983
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
Australia/dollar'
Austria/schilling
Belgium/franc
Brazil/cruzeiro
Canada/dollar
China, P.R./yuan
Denmark/krone
114.95
15.948
37.194
92.374
1.1990
1.7031
7.1350
101.65
17.060
45.780
179.22
1.2344
1.8978
8.3443
90.14
17.968
51.121
573.27
1.2325
1.9809
9.1483
91.59
18.900
54.538
870.21
1.2367
1.9940
9.6791
90.04
19.383
55.939
943.43
1.2469
1.9920
9.9530
90.60
19.815
57.354
1022.81
1.2484
2.0490
10.1793
93.48
19.028
55.279
1131.37
1.2480
2.0628
9.8549
95.13
18.285
53.135
1266.64
1.2697
2.0646
9.5175
92.31
18.630
54.078
1387.52
1.2796
2.0929
9.7311
8
9
10
11
12
13
14
15
Finland/markka
France/franc
Germany/deutsche mark
Greece/drachma
Hong Kong/dollar
India/rupee
Ireland/pound 1
Israel/shekel
4.3128
5.4396
2.2631
n.a.
5.5678
8.6807
161.32
n.a.
4.8086
6.5793
2.428
66.872
6.0697
9.4846
142.05
24.407
5.5636
7.6203
2.5539
87.895
7.2569
10.1040
124.81
55.865
5.7468
8.1646
2.6846
96.229
7.8120
10.378
115.85
89.344
5.8515
8.3839
2.7500
98.815
7.8044
10.4895
112.91
100.599
5.9385
8.5948
2.8110
102.601
7.7968
10.7152
110.20
116.728
5.7892
8.3051
2.6984
101.80
7.7883
10.744
114.21
130.21
5.6136
8.0022
2.5973
102.40
7.7942
10.714
117.88
146.40
5.6434
8.1411
2.6474
104.89
7.8073
10.820
115.67
168.76
16
17
18
19
20
21
22
23
24
Italy /lira
Japan/yen
Malaysia/ringgit
Mexico/peso
Netherlands/guilder
New Zealand/dollar1
Norway/krone
Philippines/peso
Portugal/escudo
1138.60
220.63
2.3048
24.547
2.4998
86.848
5.7430
7.8113
61.739
1354.00
249.06
2.3395
72.990
2.6719
75.101
6.4567
8.5324
80.101
1519.30
237.55
2.3204
155.01
2.8543
66.790
7.3012
11.0940
111.610
1625.79
235.03
2.3450
162.36
3.0078
65.854
7.4696
14.050
127.82
1666.88
234.46
2.3407
164.84
3.0856
65.120
7.7237
14.050
131.91
1706.63
233.80
2.3411
166.33
3.1602
64.860
7.8763
14.050
136.29
1666.39
233.60
2.3363
168.49
3.0455
65.810
7.6937
14.050
135.01
1614.17
225.27
2.2933
172.93
2.9326
66.714
7.5028
14.186
131.70
1638.48
225.20
2.2904
179.07
2.9864
65.834
7.5992
14.257
134.46
25
26
27
28
29
30
31
32
33
34
35
Singapore/dollar
South Africa/rand 1
South Korea/won
Spain/peseta
Sri Lanka/rupee
Sweden/krona
Switzerland/franc
Taiwan/Dollar
Thailand/baht
United Kingdom/pound 1
Venezuela/bolivar
2.1053
114.77
n.a.
92.396
18.967
5.0659
1.9674
n.a.
21.731
202.43
4.2781
2.1406
92.297
731.93
110.09
20.756
6.2838
2.0327
n.a.
23.014
174.80
4.2981
2.1136
89.85
776.04
143.500
23.510
7.6717
2.1006
n.a.
22.991
151.59
10.6840
2.1334
84.23
7%. 32
154.66
24.572
7.9201
2.1701
38.780
22.990
147.66
12.782
2.1317
82.15
799.23
158.01
24.767
8.0608
2.1983
39.613
22.992
143.38
12.834
2.1309
79.54
800.33
159.832
25.181
8.1782
2.2380
40.202
23.006
140.76
13.021
2.1279
81.31
799.06
154.20
25.270
7.9976
2.2050
40.236
23.000
144.17
13.023
2.0893
82.10
794.51
149.68
25.177
7.7323
2.1490
40.078
23.004
145.57
13.470
2.0853
80.19
796.41
150.26
25.133
7.8444
2.1913
39.784
23.010
142.10
14.375
102.94
116.57
125.34
130.26
132.84
135.07
131.71
128.07
130.01
1
2
3
4
5
6
7
MEMO
United States/dollar 2
1. Value in U.S. cents.
2. Index of weighted-average exchange value of U.S. dollar against currencies
of other G-10 countries plus Switzerland. March 1973 = 100. Weights are 1972-76
global trade of each of the 10 countries. Series revised as of August 1978. For
description and back data, see "Index of the Weighted-Average Exchange Value
of the U.S. Dollar: Revision" on p. 700 of the August 1978 BULLETIN.
NOTE. Averages of certified noon buying rates in New York for cable tranfers.
A65
Guide to Tabular Presentation,
Statistical Releases, and Special Tables
GUIDE TO TABULAR
Symbols and
c
e
p
r
*
PRESENTATION
Abbreviations
Corrected
Estimated
Preliminary
Revised (Notation appears on column heading when
about half of the figures in that column are changed.)
Amounts insignificant in terms of the last decimal place
shown in the table (for example, less than 500,000
when the smallest unit given is millions)
General
0
n.a.
n.e.c.
IPCs
REITs
RPs
SMSAs
Calculated to be zero
Not available
Not elsewhere classified
Individuals, partnerships, and corporations
Real estate investment trusts
Repurchase agreements
Standard metropolitan statistical areas
Cell not applicable
Information
Minus signs are used to indicate (1) a decrease, (2) a negative
figure, or (3) an outflow.
" U . S . government securities" may include guaranteed
issues of U.S. government agencies (the flow of funds figures
also include not fully guaranteed issues) as well as direct
STATISTICAL
obligations of the Treasury. "State and local government"
also includes municipalities, special districts, and other political subdivisions.
In some of the tables details do not add to totals because of
rounding.
RELEASES
List Published Semiannually,
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Reference
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SPECIAL
and
and
and
and
and
and
and
and
Page
A84
April
August
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March
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August
December
March
A70
A70
A68
A68
A76
A76
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A74
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Assets
Assets
Assets
Assets
Assets
Assets
Issue
December 1983
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liabilities
liabilities
liabilities
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of
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Reference
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agencies of foreign banks,
agencies of foreign banks,
agencies of foreign banks,
December 31, 1982
March 31, 1983
June 30, 1983
September 30, 1983
1983
1983
1983
1984
1983
1983
1983
1984
A66
Federal Reserve Board of Governors
PAUL A . VOLCKER, Chairman
HENRY C . WALLICH
PRESTON MARTIN, Vice
J. CHARLES PARTEE
OFFICE OF BOARD
Chairman
MEMBERS
J O S E P H R . C O Y N E , Assistant to the Board
D O N A L D J . W I N N , Assistant to the Board
S T E V E N M . R O B E R T S , Assistant to the Chairman
F R A N K O ' B R I E N , J R . , Deputy Assistant to the Board
A N T H O N Y F . C O L E , Special Assistant to the Board
W I L L I A M R . J O N E S , Special Assistant to the Board
N A O M I P . S A L U S , Special Assistant to the Board
OFFICE OF STAFF DIRECTOR
MONETARY AND FINANCIAL
STEPHEN H. AXILROD, Staff Director
D O N A L D L . K O H N , Deputy Staff Director
S T A N L E Y J . S I G E L , Assistant to the Board
N O R M A N D R . V . B E R N A R D , Special Assistant
DIVISION
LEGAL
DIVISION
OFFICE OF THE
SECRETARY
WILLIAM W. WILES,
Secretary
BARBARA R. LOWREY, Associate
Secretary
JAMES MCAFEE, Associate
Secretary
DIVISION OF CONSUMER
AND COMMUNITY
AFFAIRS
GRIFFITH L . GARWOOD,
Director
JERAULD C. KLUCKMAN, Associate Director
G L E N N E . L O N E Y , Assistant
Director
D O L O R E S S . S M I T H , Assistant
Director
DIVISION OF BANKING
SUPERVISION AND
REGULATION
JOHN E . R Y A N ,
Director
WILLIAM TAYLOR, Deputy Director
FREDERICK R. DAHL, Associate Director
D O N E . K L I N E , Associate
Director
JACK M. EGERTSON, Assistant
Director
R O B E R T S . P L O T K I N , Assistant
Director
S I D N E Y M . S U S S A N , Assistant
Director
L A U R A M . H O M E R , Securities Credit Officer
OF RESEARCH
JAMES L . KICHLINE,
M I C H A E L B R A D F I E L D , General
Counsel
J . V I R G I L M A T T I N G L Y , J R . , Associate General
Counsel
G I L B E R T T . S C H W A R T Z , Associate General
Counsel
R I C H A R D M . A S H T O N , Assistant General Counsel
N A N C Y P . J A C K L I N , Assistant General
Counsel
M A R Y E L L E N A . B R O W N , Assistant to the General
Counsel
FOR
POLICY
AND
to the Board
STATISTICS
Director
E D W A R D C . E T T I N , Deputy
M I C H A E L J . P R E L L , Deputy
J O S E P H S . Z E I S E L , Deputy
Director
Director
Director
JARED J. ENZLER, Associate
Director
ELEANOR J. STOCKWELL, Associate
Director
D A V I D E . L I N D S E Y , Deputy Associate
Director
F R E D E R I C K M . S T R U B L E , Deputy Associate
Director
H E L M U T F . W E N D E L , Deputy Associate
Director
M A R T H A B E T H E A , Assistant
Director
R O B E R T M . F I S H E R , Assistant
Director
SUSAN J. LEPPER, Assistant
Director
T H O M A S D . S I M P S O N , Assistant
Director
L A W R E N C E S L I F M A N , Assistant
Director
STEPHEN P. TAYLOR, Assistant
Director
P E T E R A . T I N S L E Y , Assistant
Director
L E V O N H . G A R A B E D I A N , Assistant
Director
(Administration )
DIVISION
OF INTERNATIONAL
EDWIN M . TRUMAN,
FINANCE
Director
LARRY J. PROMISEL, Senior Associate
Director
C H A R L E S J . S I E G M A N , Senior Associate
Director
DALE W. HENDERSON, Associate
Director
R O B E R T F . G E M M I L , Staff
Adviser
S A M U E L P I Z E R , Staff
Adviser
P E T E R HOOPER I I I , Assistant
Director
DAVID H. HOWARD, Assistant
Director
RAYMOND LUBITZ, Assistant
Director
R A L P H W . S M I T H , J R . , Assistant
Director
A67
and Official Staff
N A N C Y H . TEETERS
LYLE E . GRAMLEY
EMMETT J. RICE
OFFICE OF
STAFF DIRECTOR
FOR
MANAGEMENT
S. DAVID FROST, Staff
Director
Assistant
STEPHEN R. MALPHRUS, Assistant
Automation and Technology
EDWARD T. MULRENIN,
DIVISION
OF DATA
Staff Director
Staff Director for Office
PROCESSING
CHARLES L . HAMPTON,
Director
BRUCE M. BEARDSLEY, Deputy Director
G L E N N L . C U M M I N S , Assistant
Director
NEAL H. HILLERMAN, Assistant Director
RICHARD J. MANASSERI, Assistant Director
E L I Z A B E T H B . R I G G S , Assistant
Director
WILLIAM C. SCHNEIDER, JR., Assistant Director
R O B E R T J . Z E M E L , Assistant
Director
DIVISION
OF
PERSONNEL
DAVID L . SHANNON,
Director
JOHN R. WEIS, Assistant Director
CHARLES W. WOOD, Assistant Director
OFFICE OF THE
CONTROLLER
G E O R G E E . L I V I N G S T O N , Controller
B R E N T L . B O W E N , Assistant
Controller
DIVISION
OF SUPPORT
SERVICES
ROBERT E . FRAZIER,
Director
W A L T E R W . K R E I M A N N , Associate
Director
*On loan from the Federal Reserve Bank of New York.
OFFICE OF STAFF DIRECTOR FOR
FEDERAL RESERVE BANK
ACTIVITIES
THEODORE E . ALLISON, Staff Director
J O S E P H W . D A N I E L S , S R . , Advisor, Equal
Opportunity
Programs
DIVISION OF FEDERAL
BANK
OPERATIONS
Employment
RESERVE
C L Y D E H . FARNSWORTH, J R . ,
Director
E L L I O T T C . M C E N T E E , Associate
Director
DAVID L. ROBINSON, Associate
Director
C . W I L L I A M S C H L E I C H E R , J R . , Associate
Director
W A L T E R A L T H A U S E N , Assistant
Director
C H A R L E S W . B E N N E T T , Assistant
Director
ANNE M. DEBEER, Assistant
Director
JACK DENNIS, JR., Assistant
Director
EARL G. HAMILTON, Assistant
Director
* JOHN F. SOBALA, Assistant
Director
68
Federal Reserve Bulletin • May 1984
Federal Open Market Committee
FEDERAL OPEN MARKET
PAUL A . VOLCKER,
COMMITTEE
A N T H O N Y M . SOLOMON,
Chairman
EDWARD G . BOEHNE
ROBERT H . BOYKIN
E . G E R A L D CORRIGAN
L Y L E E . GRAMLEY
K A R E N N . HORN
PRESTON M A R T I N
STEPHEN H . A X I L R O D , Staff Director
N O R M A N D R . V . B E R N A R D , Assistant
NANCY M. STEELE, Deputy
and Secretary
Secretary
Assistant
JOSEPH E . B U R N S , Associate
JOHN M . D A V I S , Associate
FEDERAL ADVISORY
(International)
COUNCIL
Third District
JOHN G . MCCOY, F o u r t h District
V I N C E N T C . B U R K E , J R . , Fifth District
PHILIP
F.
SEARLE,
N. B E R N E H A R T , Tenth District
NAT S. ROGERS, Eleventh District
JOSEPH J . P I N O L A , Twelfth District
Sixth District
Directors
ROGER E . ANDERSON, S e v e n t h District
WILLIAM H. BOWEN, Eighth District
E. P E T E R G I L L E T T E , J R . , Ninth District
First District
LEWIS T . PRESTON, S e c o n d District
GEORGE A . B U T L E R ,
Economist
for Domestic Operations, System Open Market Account
Foreign Operations, System Open Market Account
JOHN G . M C C O Y , President
JOSEPH J . P I N O L A , Vice President
V I N C E N T C . B U R K E , J R . , N . B E R N E H A R T , AND L E W I S T . PRESTON,
ROBERT L . N E W E L L ,
Economist
Economist
D A V I D E . L I N D S E Y , Associate
Economist
M I C H A E L J . P R E L L , Associate
Economist
C H A R L E S J . S I E G M A N , Associate
Economist
G A R Y H . S T E R N , Associate
Economist
JOSEPH S . Z E I S E L , Associate
Economist
Economist
Economist
P E T E R D . S T E R N L I G H T , Manager
S A M Y . CROSS, Manager for
R I C H A R D G . D A V I S , Associate
D O N A L D L . K O H N , Associate
RICHARD W. LANG, Associate
Secretary
M I C H A E L B R A D F I E L D , General Counsel
J A M E S H . O L T M A N , Deputy General Counsel
JAMES L . KICHLINE,
Economist
EDWIN M . TRUMAN, Economist
J . CHARLES PARTEE
EMMETT J . RICE
NANCY H . TEETERS
HENRY C . WALLICH
HERBERT V . PROCHNOW,
WILLIAM J . KORSVIK,
Associate
Secretary
Secretary
Vice
Chairman
A69
and Advisory Councils
CONSUMER
ADVISORY
COUNCIL
WILLARD P. OGBURN, Boston, Massachusetts, Chairman
D. M A R R I N A N , Minneapolis, Minnesota, Vice Chairman
TIMOTHY
R A C H E L G. B R A T T , Medford, Massachusetts
J A M E S G. B O Y L E , Austin, Texas
G E R A L D R . C H R I S T E N S E N , Salt Lake City, Utah
THOMAS L. C L A R K , J R . , New York, New York
FREDERICK H . MILLER, N o r m a n , O k l a h o m a
MARGARET M . MURPHY, Columbia, M a r y l a n d
JEAN A. CROCKETT, Philadelphia, P e n n s y l v a n i a
ELVA QUIJANO, S a n Antonio, T e x a s
JANET J . RATHE, Portland, Oregon
M E R E D I T H FERNSTROM, New York, New
A L L E N J. F I S H B E I N , Washington, D.C.
York
E.C.A. FORSBERG, SR., Atlanta, Georgia
S T E V E N M. G E A R Y , Jefferson City, Missouri
R I C H A R D F. H A L L I B U R T O N , Kansas City, Missouri
L O U I S E M C C A R R E N H E R R I N G , Cincinnati, Ohio
C H A R L E S C . H O L T , Austin, Texas
H A R R Y N. J A C K S O N , Minneapolis, Minnesota
K E N N E T H V. L A R K I N , San Francisco, California
THRIFT INSTITUTIONS
ADVISORY
R O B E R T F. M U R P H Y , Detroit, Michigan
L A W R E N C E S. O K I N A G A , Honolulu, Hawaii
J A N E T SCACCIOTTI, Providence, Rhode Island
G L E N D A G. S L O A N E , Washington, D.C.
H E N R Y J . SOMMER, P h i l a d e l p h i a , P e n n s y l v a n i a
W I N N I E F. T A Y L O R , Gainesville, Florida
M I C H A E L M. V A N B U S K I R K , Columbus, Ohio
CLINTON W A R N E , Cleveland, Ohio
FREDERICK T . WEIMER, Chicago, Illinois
M E R V I N WINSTON,
Minneapolis, Minnesota
COUNCIL
THOMAS R . BOMAR, Miami, Florida, President
R I C H A R D H . D E I H L , LOS Angeles, California, Vice President
J A M E S A . A L I B E R , Detroit, Michigan
G E N E R . A R T E M E N K O , Chicago, Illinois
J . M I C H A E L C O R N W A L L , Dallas, Texas
JOHN R . EPPINGER, Villanova, Pennsylvania
NORMAN M. J O N E S , Fargo, North Dakota
ROBERT R . M A S T E R T O N , Portland, Maine
JOHN T. MORGAN, New York, New York
FRED A . PARKER, M o n r o e , N o r t h Carolina
SARAH R . WALLACE,
Newark, Ohio
A70
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587
241
239
266
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T H E F E D E R A L R E S E R V E A C T , as amended through April 20,
1983. with an appendix containing provisions of certain
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pp. $7.00.
REGULATIONS OF THE B O A R D OF GOVERNORS OF THE F E D ERAL R E S E R V E S Y S T E M .
BANKS.
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IMPROVING THE M O N E T A R Y A G G R E G A T E S : REPORT OF THE
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A N N U A L P E R C E N T A G E R A T E T A B L E S (Truth in Lending—
Regulation Z) Vol. I (Regular Transactions). 1969. 100
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volume $1.00; 10 or more of same volume to one
address, $.85 each.
F E D E R A L R E S E R V E M E A S U R E S OF C A P A C I T Y AND CAPACITY
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address, $1.50 each.
THE BANK
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M O V E M E N T TO 1978:
A
COMPENDIUM. 1978. 289 pp. $2.50 each; 10 or more to
one address, $2.25 each.
IMPROVING THE M O N E T A R Y A G G R E G A T E S : S T A F F PAPERS.
PUBLIC POLICY AND C A P I T A L FORMATION.
1981. 326
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N E W M O N E T A R Y CONTROL PROCEDURES:
SERVE S T A F F S T U D Y . 1 9 8 1 .
A71
SEASONAL A D J U S T M E N T OF T H E M O N E T A R Y A G G R E G A T E S :
REPORT OF T H E C O M M I T T E E OF E X P E R T S ON S E A S O N A L
A D J U S T M E N T T E C H N I Q U E S . 1981. 5 5 pp. $ 2 . 7 5 each.
F E D E R A L R E S E R V E R E G U L A T O R Y S E R V I C E . Looseleaf; updat-
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Consumer and Community Affairs Handbook. $60.00 per
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Monetary Policy and Reserve Requirements Handbook.
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Securities Credit Transactions Handbook. $60.00 per year.
Federal Reserve Regulatory Service. 3 vols. (Contains all
three Handbooks plus substantial additional material.)
$175.00 per year.
Rates for subscribers outside the United States are as
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Each Handbook, $75.00 per year.
W E L C O M E TO THE F E D E R A L R E S E R V E .
PROCESSING B A N K H O L D I N G C O M P A N Y A N D M E R G E R A P P L I CATIONS
SUSTAINABLE RECOVERY: SETTING THE S T A G E ,
November
1982.
R E M A R K S B Y C H A I R M A N P A U L A . V O L C K E R , AT A N N U A L
HUMAN RELATIONS A W A R D DINNER, D e c e m b e r 1982.
R E M A R K S B Y C H A I R M A N P A U L A . V O L C K E R , AT DEDICATION
C E R E M O N I E S : F E D E R A L R E S E R V E B A N K OF S A N F R A N -
CISCO, M a r c h 1983.
Truth in Leasing
U.S. Currency
What Truth in Lending Means to You
STAFF STUDIES • Summaries
Only
Printed
in
the
Bulletin
Studies and papers on economic and financial subjects that
are of general interest. Requests to obtain single copies of
the full text or to be added to the mailing list for the series
may be sent to Publications
Services.
113. B E L O W T H E B O T T O M L I N E : T H E U S E OF C O N T I N G E N CIES A N D C O M M I T M E N T S B Y C O M M E R C I A L B A N K S , b y
Benjamin Wolkowitz and others. Jan. 1982. 186 pp.
114. M U L T I B A N K HOLDING COMPANIES: R E C E N T E V I D E N C E ON COMPETITION AND P E R F O R M A N C E IN
B A N K I N G M A R K E T S , by Timothy J. Curry and John T.
Rose. Jan. 1982. 9 pp.
1 1 5 . COSTS, S C A L E E C O N O M I E S , C O M P E T I T I O N , A N D PRODUCT M I X IN T H E U . S . P A Y M E N T S M E C H A N I S M , b y
David B. Humphrey. Apr. 1982. 18 pp.
COMPILATION,
1 1 6 . DIVISIA M O N E T A R Y A G G R E G A T E S :
DATA, AND HISTORICAL BEHAVIOR, b y W i l l i a m A .
Barnett and Paul A. Spindt. May 1982. 82 pp.
A.
117. T H E C O M M U N I T Y R E I N V E S T M E N T A C T AND C R E D I T
C R E D I T C A R D S IN T H E U . S . E C O N O M Y : T H E I R IMPACT ON
C O S T S , P R I C E S , A N D R E T A I L S A L E S , July 1983. 114 pp.
118. I N T E R E S T R A T E S A N D T E R M S ON CONSTRUCTION
L O A N S AT C O M M E R C I A L B A N K S , by David F. Seiders.
T H E U . S . ECONOMY IN AN I N T E R D E P E N D E N T W O R L D : A
M U L T I C O U N T R Y M O D E L , M A Y 1 9 8 4 . 5 9 0 PP. $ 1 4 . 5 0
EACH.
119. S T R U C T U R E - P E R F O R M A N C E S T U D I E S IN B A N K I N G :
A N UPDATED SUMMARY AND EVALUATION, b y S t e -
RESTORING S T A B I L I T Y . R E M A R K S B Y C H A I R M A N P A U L
VOLCKER, April 1983.
ALLOCATION, by Glenn Canner. June 1982. 8 pp.
July 1982. 14 pp.
phen A. Rhoades. Aug. 1982. 15 pp.
1 2 0 . F O R E I G N S U B S I D I A R I E S OF U . S . B A N K I N G O R G A N I Z A -
CONSUMER EDUCATION
PAMPHLETS
Short pamphlets suitable for classroom use. Multiple
available without charge.
TIONS, by James V. Houpt and Michael G. Martinson.
Oct. 1982. 18 pp.
copies
Alice in Debitland
Consumer Handbook to Credit Protection Laws
The Equal Credit Opportunity Act and . . . Age
The Equal Credit Opportunity Act and . . . Credit Rights in
Housing
The Equal Credit Opportunity Act and . . . Doctors, Lawyers, Small Retailers, and Others Who May Provide Incidental Credit
The Equal Credit Opportunity Act and . . . Women
Fair Credit Billing
Federal Reserve Glossary
Guide to Federal Reserve Regulations
How to File A Consumer Credit Complaint
If You Borrow To Buy Stock
If You Use A Credit Card
Instructional Materials of the Federal Reserve System
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
121. REDLINING: RESEARCH AND F E D E R A L
LEGISLATIVE
RESPONSE, by Glenn B. Canner. Oct. 1982. 20 pp.
122. B A N K C A P I T A L T R E N D S A N D F I N A N C I N G , by Samuel
H. Talley. Feb. 1983. 19 pp. Out of print.
1 2 3 . F I N A N C I A L T R A N S A C T I O N S WITHIN B A N K
HOLDING
COMPANIES, by John T. Rose and Samuel H. Talley.
May 1983. 11 pp.
124. I N T E R N A T I O N A L B A N K I N G F A C I L I T I E S A N D T H E E U RODOLLAR M A R K E T , by Henry S. Terrell and Rodney
H. Mills. August 1983. 14 pp.
1 2 5 . S E A S O N A L A D J U S T M E N T OF T H E W E E K L Y M O N E T A R Y
A G G R E G A T E S : A M O D E L - B A S E D A P P R O A C H , by David
A. pierce, Michael R. Grupe, and William P. Cleveland. August 1983. 23 pp.
1 2 6 . D E F I N I T I O N A N D M E A S U R E M E N T OF E X C H A N G E M A R -
KET INTERVENTION, by Donald B. Adams and Dale
W. Henderson. August 1983. 5 pp.
* 1 2 7 . U . S . E X P E R I E N C E WITH E X C H A N G E M A R K E T I N T E R -
VENTION: JANUARY-MARCH
1975, by Margaret
L.
Greene.
* 1 2 8 . U . S . E X P E R I E N C E WITH E X C H A N G E M A R K E T I N T E R VENTION: S E P T E M B E R 1 9 7 7 - O c T O B E R 1 9 8 1 , by Marga-
ret L. Greene.
* 1 2 9 . U . S . E X P E R I E N C E WITH E X C H A N G E M A R K E T I N T E R VENTION: OCTOBER I 9 8 O - O C T O B E R 1 9 8 1 , b y M a r g a r e t
L. Greene.
A72
1 3 0 . E F F E C T S OF E X C H A N G E R A T E V A R I A B I L I T Y ON INTERNATIONAL T R A D E AND OTHER ECONOMIC V A R I A BLES: A R E V I E W OF THE L I T E R A T U R E , by Victoria S .
Farrell with Dean A. DeRosa and T. Ashby McCown.
January 1984. 21 pp.
131. C A L C U L A T I O N S OF P R O F I T A B I L I T Y FOR U . S . D O L L A R D E U T S C H E M A R K INTERVENTION, b y L a u r e n c e R .
Jacobson. October 1983. 8 pp.
132. T I M E - S E R I E S S T U D I E S OF THE R E L A T I O N S H I P BETWEEN E X C H A N G E R A T E S AND INTERVENTION: A
R E V I E W OF THE TECHNIQUES AND L I T E R A T U R E , b y
Kenneth Rogoff. October 1983. 15 pp.
1 3 3 . RELATIONSHIPS AMONG E X C H A N G E R A T E S , INTERVENTION, AND I N T E R E S T R A T E S : A N E M P I R I C A L IN-
VESTIGATION, by Bonnie E. Loopesko. November
1983. 20 pp.
134. S M A L L E M P I R I C A L M O D E L S OF E X C H A N G E M A R K E T
INTERVENTION: A R E V I E W OF THE L I T E R A T U R E , b y
Ralph W. Try on. October 1983. 14 pp.
* 1 3 5 . S M A L L E M P I R I C A L M O D E L S OF E X C H A N G E M A R K E T
INTERVENTION: APPLICATIONS TO C A N A D A , G E R M A -
NY, AND JAPAN, by Deborah J. Danker, Richard A.
Haas, Dale W. Henderson, Steven A. Symansky, and
Ralph W. Tryon.
1 3 6 . T H E E F F E C T S OF F I S C A L POLICY ON THE U . S . ECONO-
MY, by Darrell Cohen and Peter B. Clark. January
1984. 16 pp.
1 3 7 . T H E IMPLICATIONS FOR B A N K M E R G E R POLICY OF
FINANCIAL DEREGULATION, INTERSTATE BANKING,
AND FINANCIAL
SUPERMARKETS,
Rhoades. February 1984. 8 pp.
by
Stephen
A.
T h e availability of these studies will be announced in a
f o r t h c o m i n g BULLETIN.
REPRINTS OF BULLETIN
ARTICLES
Most of the articles reprinted do not exceed 12 pages.
Survey of Finance Companies. 1980. 5/81.
Bank Lending in Developing Countries. 9/81.
The Commercial Paper Market since the Mid-Seventies. 6/82.
Applying the Theory of Probable Future Competition. 9/82.
International Banking Facilities. 10/82.
New Federal Reserve Measures of Capacity and Capacity
Utilization. 7/83.
Foreign Experience with Targets for Money Growth. 10/83.
Intervention in Foreign Exchange Markets: A Summary of
Ten Staff Studies. 11/83.
A Financial Perspective on Agriculture. 1/84.
U.S. International Transactions in 1983. 4/84.
A73
Index to Statistical Tables
References
are to pages A3 through A64 although the prefix 'A" is omitted in this index
ACCEPTANCES, bankers, 9, 22, 24
Agricultural loans, commercial banks, 18, 19, 23
Assets and liabilities (See also Foreigners)
Banks, by classes, 17-19
Domestic finance companies, 35
Federal Reserve Banks, 10
Foreign banks, U.S. branches and agencies, 20
Nonfinancial corporations, 34
Savings institutions, 26
Automobiles
Consumer installment credit, 38, 39
Production, 44, 45
BANKERS acceptances, 9, 22, 24
Bankers balances, 17-19 (See also Foreigners)
Bonds (See also U.S. government securities)
New issues, 32
Rates 3
Branch banks, 14, 20, 52
Business activity, nonfinancial, 42
Business expenditures on new plant and equipment, 34
Business loans (See Commercial and industrial loans)
CAPACITY utilization, 42
Capital accounts
Banks, by classes, 17
Federal Reserve Banks, 10
Central banks, discount rates, 63
Certificates of deposit, 20, 24
Commercial and industrial loans
Commercial banks, 15, 20, 23
Weekly reporting banks, 18-20
Commercial banks
Assets and liabilities, 17-19
Business loans, 23
Commercial and industrial loans, 15, 20, 23
Consumer loans held, by type, and terms, 38, 39
Loans sold outright, 19
Nondeposit fund, 16
Number, by classes, 17
Real estate mortgages held, by holder and property, 37
Time and savings deposits, 3
Commercial paper, 3, 22, 24, 35
Condition statements (See Assets and liabilites)
Construction, 42, 46
Consumer installment credit, 38, 39
Consumer prices, 42, 47
Consumption expenditures, 48, 49
Corporations
Profits and their distribution, 33
Security issues, 32, 62
Cost of living (See Consumer prices)
Credit unions, 26, 38 (See also Thrift institutions)
Currency and coin, 17
Currency in circulation, 4, 13
Customer credit, stock market, 25
DEBITS to deposit accounts, 14
Debt (See specific types of debt or securities)
Demand deposits
Adjusted, commercial banks, 14
Banks, by classes, 17-20
Demand deposits—Continued
Ownership by individuals, partnerships, and
corporations, 21
Turnover, 14
Depository institutions
Reserve requirements, 7
Reserves and related items, 3, 4, 5, 12
Deposits (See also specific types)
Banks, by classes, 3, 17-20, 26
Federal Reserve Banks, 4, 10
Turnover, 14
Discount rates at Reserve Banks and at foreign central
banks (See Interest rates)
Discounts and advances by Reserve Banks (See Loans)
Dividends, corporate, 33
EMPLOYMENT, 42, 43
Eurodollars, 24
FARM mortgage loans, 37
Federal agency obligations, 4, 9, 10, 11, 30
Federal credit agencies, 31
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, 31
Federal funds, 3, 5, 16, 18, 19, 20, 24, 27
Federal Home Loan Banks, 31
Federal Home Loan Mortgage Corporation, 31, 36, 37
Federal Housing Administration, 31, 36, 37
Federal Land Banks, 37
Federal National Mortgage Association, 31, 36, 37
Federal Reserve Banks
Condition statement, 10
Discount rates (See Interest rates)
U.S. government securities held, 4, 10, 11, 29
Federal Reserve credit, 4, 5, 10, l i
Federal Reserve notes, 10
Federally sponsored credit agencies, 31
Finance companies
Assets and liabilities, 35
Business credit, 35
Loans, 18, 38, 39
Paper, 22, 24
Financial institutions
Loans to, 18, 19, 20
Selected assets and liabilities, 26
Float, 4
Flow of funds, 40, 41
Foreign banks, assets and liabilities of U.S. branches and
agencies, 20
Foreign currency operations, 10
Foreign deposits in U.S. banks, 4, 10, 18, 19
Foreign exchange rates, 64
Foreign trade, 51
Foreigners
Claims on, 52, 54, 57, 58, 59, 61
Liabilities to, 19, 51, 52-56, 60, 62, 63
A74
GOLD
Certificate account, 10
Stock, 4, 51
Government National Mortgage Association, 31, 36, 37
Gross national product, 48, 49
HOUSING, new and existing units, 46
INCOME, personal and national, 42, 48, 49
Industrial production, 42, 44
Installment loans, 38, 39
Insurance companies, 26, 29, 37
Interbank loans and deposits, 17
Interest rates
Bonds, 3
Business loans of banks, 23
Federal Reserve Banks, 3, 6
Foreign central banks and foreign countries, 63, 64
Money and capital markets, 3, 24
Mortgages, 3, 36
Prime rate, commercial banks, 22
Time and savings deposits, 8
International capital transactions of United States, 50-63
International organizations, 54, 55-57, 60-63
Inventories, 48
Investment companies, issues and assets, 33
Investments (See also specific types)
Banks, by classes, 17, 19, 26
Commercial banks, 3, 15, 17-19, 20, 37
Federal Reserve Banks, 10, 11
Savings institutions, 26, 37
LABOR force, 43
Life insurance companies (See Insurance companies)
Loans (See also specific types)
Banks, by classes, 17-19
Commercial banks, 3, 15, 17-19, 20, 23
Federal Reserve Banks, 4, 5, 6, 10, 11
Insured or guaranteed by United States, 36, 37
Savings institutions, 26, 37
MANUFACTURING
Capacity utilization, 42
Production, 42, 45
Margin requirements, 25
Member banks (See also Depository institutions)
Federal funds and repurchase agreements, 5
Reserve requirements, 7
Mining production, 45
Mobile homes shipped, 46
Monetary and credit aggregates, 3, 12
Money and capital market rates (See Interest rates)
Money stock measures and components, 3, 13
Mortgages (See Real estate loans)
Mutual funds (See Investment companies)
Mutual savings banks, 8, 18-19, 26, 29, 37, 38 (See also
Thrift institutions)
NATIONAL defense outlays, 28
National income, 48
OPEN market transactions, 9
PERSONAL income, 49
Prices
Consumer and producer, 42, 47
Stock market, 25
Prime rate, commercial banks, 22
Producer prices, 42, 47
Production, 42, 44
Profits, corporate, 33
REAL estate loans
Banks, by classes, 15, 18, 19, 37
Rates, terms, yields, and activity, 3, 36
Savings institutions, 26
Type of holder and property mortgaged, 37
Repurchase agreements, 5, 16, 18, 19, 20
Reserve requirements, 7
Reserves
Commercial banks, 17
Depository institutions, 3, 4, 5, 12
Federal Reserve Banks, 10
U.S. reserve assets, 51
Residential mortgage loans, 36
Retail credit and retail sales, 38, 39, 42
SAVING
Flow of funds, 40, 41
National income accounts, 49
Savings and loan associations, 8, 26, 37, 38, 40 (See also
Thrift institutions)
Savings deposits (See Time and savings deposits)
Securities (See specific types)
Federal and federally sponsored credit agencies, 31
Foreign transactions, 62
New issues, 32
Prices, 25
Special drawing rights, 4, 10, 50, 51
State and local governments
Deposits, 18, 19
Holdings of U.S. government securities, 29
New security issues, 32
Ownership of securities issued by, 18, 19, 26
Rates on securities, 3
Stock market, 25
Stocks (See also Securities)
New issues, 32
Prices, 25
Student Loan Marketing Association, 31
TAX receipts, federal, 28
Thrift institutions, 3 (See also Credit unions, Mutual
savings banks, and Savings and loan associations)
Time and savings deposits, 3, 8, 13, 16, 17-20
Trade, foreign, 51
Treasury currency, Treasury cash, 4
Treasury deposits, 4, 10, 27
Treasury operating balance, 27
UNEMPLOYMENT, 43
U.S. government balances
Commercial bank holdings, 17, 18, 19
Treasury deposits at Reserve Banks, 4, 10, 27
U.S. government securities
Bank holdings, 16, 17-19, 20, 29
Dealer transactions, positions, and financing, 30
Federal Reserve Bank holdings, 4, 10, 11, 29
Foreign and international holdings and transactions, 10,
29, 63
Open market transactions, 9
Outstanding, by type and holder, 26, 29
Rates, 3, 24
U.S. international transactions, 50-63
Utilities, production, 45
VETERANS Administration, 36, 37
WEEKLY reporting banks, 18-20
Wholesale (producer) prices, 42, 47
YIELDS (See Interest rates)
A75
Federal Reserve Banks, Branches, and Offices
FEDERAL RESERVE BANK, Chairman
branch, or facility
Zip
Deputy Chairman
President
First Vice President
BOSTON*
02106
Robert P. Henderson
Thomas I. Atkins
Frank E. Morris
James A. Mcintosh
NEW YORK*
10045
John Brademas
Gertrude G. Michelson
M. Jane Dickman
Anthony M. Solomon
Thomas M. Timlen
Buffalo
14240
John T. Keane
PHILADELPHIA
19105
Robert M. Landis
Nevius M. Curtis
Edward G. Boehne
Richard L. Smoot
CLEVELAND*
44101
William H. Knoell
E. Mandell de Windt
Vacant
Milton G. Hulme, Jr.
Karen N. Horn
William H. Hendricks
William S. Lee
Leroy T. Canoles, Jr.
Robert L. Tate
Henry Ponder
Robert P. Black
Jimmie R. Monhollon
John H. Weitnauer, Jr.
Bradley Currey, Jr.
Martha A. Mclnnis
Jerome P. Keuper
Sue McCourt Cobb
C. Warren Neel
Sharon A. Perlis
Robert P. Forrestal
Jack Guynn
Stanton R. Cook
Edward F. Brabec
Russell G. Mawby
Silas Keehn
Daniel M. Doyle
W.L. Hadley Griffin
Mary P. Holt
Sheffield Nelson
Sister Eileen M. Egan
Patricia W. Shaw
Theodore H. Roberts
Joseph P. Garbarini
William G. Phillips
John B. Davis, Jr.
Ernest B. Corrick
E. Gerald Corrigan
Thomas E. Gainor
Doris M. Drury
Irvine O. Hockaday, Jr.
James E. Nielson
Patience Latting
Robert G. Lueder
Roger Guffey
Henry R. Czerwinski
Robert D. Rogers
John V. James
Mary Carmen Saucedo
Paul N. Howell
Lawrence L. Crum
Robert H. Boykin
William H. Wallace
Caroline L. Ahmanson
Alan C. Furth
Bruce M. Schwaegler
Paul E. Bragdon
Wendell J. Ashton
John W. Ellis
John J. Balles
Richard T. Griffith
Cincinnati
Pittsburgh
45201
15230
RICHMOND*
23219
Baltimore
21203
Charlotte
28230
Culpeper Communications
and Records Center 22701
ATLANTA
Birmingham
Jacksonville
Miami
Nashville
New Orleans
30301
35283
32231
33152
37203
70161
CHICAGO*
60690
Detroit
48231
ST. LOUIS
63166
Little Rock
Louisville
Memphis
72203
40232
38101
MINNEAPOLIS
55480
Helena
KANSAS CITY
Denver
Oklahoma City
Omaha
DALLAS
El Paso
Houston
San Antonio
59601
64198
80217
73125
68102
75222
79999
77252
78295
SAN FRANCISCO
94120
Los Angeles
Portland
Salt Lake City
Seattle
90051
97208
84125
98124
Vice President
in charge of branch
Charles A. Cerino
Harold J. Swart
Robert D. McTeer, Jr.
Albert D. Tinkelenberg
John G. Stoides
Fred R. Herr
James D. Hawkins
Patrick K. Barron
Jeffrey J. Wells
Henry H. Bourgaux
William C. Conrad
John F. Breen
James E. Conrad
Paul I. Black, Jr.
Robert F. McNellis
Wayne W. Martin
William G. Evans
Robert D. Hamilton
Joel L. Koonce, Jr.
J.Z. Rowe
Thomas H. Robertson
Richard C. Dunn
Angelo S. Carella
A. Grant Holman
Gerald R. Kelly
* Additional offices of these Banks are located at Lewiston, Maine 04240; Windsor Locks, Connecticut 06096; Cranford, New Jersey 07016;
Jericho, New York 11753; Utica at Oriskany, New York 13424; Columbus, Ohio 43216; Columbia, South Carolina 29210; Charleston, West
Virginia 25311; Des Moines, Iowa 50306; Indianapolis, Indiana 46204; and Milwaukee, Wisconsin 53202.
A76
The Federal Reserve System
Boundaries of Federal Reserve Districts and Their Branch Territories
LEGEND
Q
' Boundaries of Federal Reserve Districts
®
Federal Reserve Bank Cities
Boundaries of Federal Reserve Branch
Territories
•
Federal Reserve Branch Cities
*
Federal Reserve Bank Facility
Board of Governors of the Federal Reserve
System
Publications of Interest
FEDERAL RESERVE
PUBLICATIONS
CONSUMER
CREDIT
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 use Truth in Lending
information to compare credit costs.
The Board also publishes the Consumer Handbook
to Credit Protection Laws, a complete guide to con-
sumer credit protections. This 44-page booklet explains how to use the credit laws to shop for credit,
apply for it, keep up credit ratings, and complain about
an unfair deal.
Protections offered by the Electronic Fund Transfer
Act are explained in Alice in Debitland. This booklet
offers tips for those using the new "paperless" systems for transferring money.
Copies of consumer publications are available free
of charge from Publications Services, Mail Stop 138,
Board of Governors of the Federal Reserve System,
Washington, D.C. 20551. Multiple copies for classroom use are also available free of charge.
LMMO
LE4SING
LE4SMG
LE4SMG
TRUTH IN LE4SING
What
Ttuthln
Lending
Means
ToYou
Tbe Equal Credit
Opportunity Act
and...
Ilk
KUI Equal Credit
| Opportunity
Act and
Credit Rights
: In Housing
I
L
The
Equal
Credit
Opportunity
Act
and...
WOMEN
YOU USE A
CREDIT
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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 and 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, and consumer affairs.
These publications are designed to help those who
must frequently refer to the Board's regulatory materials. They are updated at least monthly, and each
contains conversion tables, citation indexes, and a
subject index.
The Monetary Policy and Reserve Requirements
Handbook contains Regulations A, D, and Q plus
related materials. For convenient reference, it also
contains the rules of the Depository Institutions
Deregulation Committee.
The Securities Credit Transactions Handbook contains Regulations G, T, U, and X, dealing with extensions of credit for the purchase of securities, together
with all related statutes, Board interpretations, rulings, and staff opinions. Also included is the Board's
list of OTC margin stocks.
The Consumer and Community Affairs Handbook
contains Regulations B, C, E, M, Z, AA, and BB and
associated materials.
For domestic subscribers, the annual rate is $175 for
the Federal Reserve Regulatory Service and $60 for
each handbook. For subscribers outside the United
States, the price including additional air mail costs is
$225 for the Service and $75 for each Handbook. All
subscription requests must be accompanied by a check
or money order payable to Board of Governors of the
Federal Reserve System. Orders should be addressed
to Publications Services, Mail Stop 138, Federal Reserve Board, 20th Street and Constitution Avenue,
N.W., Washington, D.C. 20551.
@FedFRASER