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VOLUME 79 •

NUMBER 9 •

SEPTEMBER 1993

FEDERAL RESERVE

BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM, WASHINGTON, D . C .
PUBLICATIONS COMMITTEE
Joseph R. Coyne, Chairman • S. David Frost • Griffith L. Garwood • Donald L. Kohn
• J. Virgil Mattingly, Jr. • Michael J. Prell • Richard Spillenkothen • Edwin M. Truman

The Federal Reserve Bulletin is issued monthly under the direction of the staff publications committee. This committee is responsible for opinions
expressed except in official statements and signed articles. It is assisted by the Economic Editing Section headed by S. Ellen Dykes, the Graphics
Center under the direction of Peter G. Thomas, and Publications Services supervised by Linda C. Kyles.




Table of Contents
827 MONETARY POLICY
TO THE CONGRESS

Erratum regarding data in table 1.27 in the
August issue of the Bulletin.

REPORT

The Federal Reserve expects economic activity to strengthen in the second half of 1993
and continue to expand moderately in 1994.
Increases in employment are projected to be
large enough to keep the unemployment rate
moving down, and inflation is not expected to
change materially over this period.
846 INDUSTRIAL PRODUCTION AND
CAPACITY UTILIZATION FOR JUNE

1993

Industrial production, which was unchanged
in May, declined 0.2 percent. Utilization of
total industrial capacity eased again, to
81.2 percent.
849 STATEMENT

TO THE CONGRESS

Alan Greenspan, Chairman, Board of Governors, discusses the Federal Reserve's semiannual Monetary Policy Report to the Congress and says that a monetary policy that
aims at price stability permits low long-term
interest rates and helps provide a stable setting
to foster the investment and innovation by the
private sector that are key to long-run economic growth, before the Subcommittee on
Economic Growth and Credit Formation of
the House Committee on Banking, Finance
and Urban Affairs, July 20, 1993. (Chairman
Greenspan presented identical testimony
before the Senate Committee on Banking,
Housing, and Urban Affairs, July 22, 1993.)

Availability of revised Lists of OTC Margin
Stocks and of Foreign Margin Stocks.
859 MINUTES OF THE FEDERAL OPEN
MARKET COMMITTEE MEETING

At its meeting on May 18,1993, the Committee adopted a directive that called for maintaining the existing degree of pressure on
reserve positions and that included a bias
toward possible firming of reserve conditions
during the intermeeting period. The directive
indicated that in the context of the Committee's long-run objectives for price stability
and sustainable economic growth, and giving
careful consideration to economic, financial,
and monetary developments, slightly greater
reserve restraint would be acceptable or
slightly lesser reserve restraint might be
acceptable during the intermeeting period.
The reserve conditions contemplated at this
meeting were expected to be consistent with
appreciable growth in the broader monetary
aggregates over the second quarter.
867 LEGAL

DEVELOPMENTS

Various bank holding company, bank service
corporation, and bank merger orders; and
pending cases.
A1 FINANCIAL AND BUSINESS STATISTICS
These tables reflect data available as of
July 27, 1993.

856 ANNOUNCEMENTS
Appointment of the new president of the Federal Reserve Bank of New York.
Actions to ease financial stress in areas of the
Midwest affected by flooding.



A3 GUIDE TO TABULAR

PRESENTATION

A4 Domestic Financial Statistics
A44 Domestic Nonfinancial Statistics
A53 International Statistics

A69 GUIDE TO STATISTICAL RELEASES
SPECIAL TABLES
A70 INDEX TO STATISTICAL

AND

TABLES

A76 FEDERAL RESERVE
PUBLICATIONS

BOARD

A78 MAPS OF THE FEDERAL
SYSTEM

RESERVE

A72 BOARD OF GOVERNORS AND STAFF
A74 FEDERAL OPEN MARKET
COMMITTEE
AND STAFF; ADVISORY COUNCILS




A80 FEDERAL RESERVE BANKS,
AND OFFICES

BRANCHES,

Monetary Policy Report to the Congress
Report submitted to the Congress on July 20, 1993,
pursuant to the Full Employment and Balanced
Growth Act of 1978l

MONETARY POUCY AND THE ECONOMIC
OUTLOOK FOR 1993 AND 1994

In February, when the Federal Reserve prepared its
monetary policy plans for 1993, the broad trends in
the economy appeared favorable. After a hesitant
beginning, the economic expansion had picked up
steam in the latter part of 1992, while inflation
seemed still to be headed downward. Most members of the Federal Open Market Committee and
nonvoting presidents anticipated that 1993 would
be a good year for growth and would also see
further progress toward price stability.
As the year has unfolded, however, the economy's performance has fallen short of these expectations. Economic growth has slowed appreciably
from the pace late last year; in part, this has
reflected a retreat in business and consumer confidence and the effects on our trade balance of weakness in a number of other industrial countries. Like
most private forecasters, the Board members and
Bank presidents generally have trimmed their projections of growth in real gross domestic product
for the year as a whole, although they continue to
foresee increases in output large enough to extend
the reduction in the unemployment rate that began
last summer. Events on the price side also have
been disappointing. The inflation rate in the first
part of this year was higher than in late 1992. There
is evidence that some of the pickup in the consumer price index may have reflected difficulties in
seasonal adjustment, and price data for the past
couple of months have been much more favorable.

1. The charts for the report are available on request from Publications Services, Board of Governors of the Federal Reserve System, Washington, DC 20551.




Nonetheless, a broad array of indicators points to a
leveling out of the underlying inflation trend.
In this circumstance, and with short-term interest
rates unusually low, especially when compared
with inflation, the Federal Reserve recognized a
need to be alert to the possibility that the balance of
risks in the economy could shift soon in a direction
dictating some firming of policy; failure to act in a
timely manner could lead to a buildup of inflationary pressures, to adverse reactions in financial markets, and ultimately to the disruption of the growth
process. To this point, however, the moderate thrust
of aggregate demand and considerable slack in the
economy, taken together with the more subdued
price data of late, do not suggest that a sustained
upswing in inflation is at hand. Accordingly, the
Federal Reserve has not adjusted its monetary policy instruments.
The pace of economic growth in the final quarter
of 1992 was not expected to be sustained, but the
slowing in the first quarter of 1993 was surprisingly sharp. With the exception of business fixed
investment, the slowdown cut across the major
categories of final demand. After stepping up their
spending in late 1992, consumers became more
pessimistic about their economic prospects and
more cautious in their spending decisions; the
uncertainty surrounding the efforts to reduce the
federal deficit may have been a factor in the weakening of household sentiment. Housing activity,
which also had been exceptionally strong late last
year, hit a lull—even before the March blizzard on
the East Coast—and real defense purchases
plunged. Moreover, net exports deteriorated
sharply, as exports declined and imports surged;
the drop in exports was attributable in part to
continued weak growth in some other industrial
countries and in part was an adjustment to the big
increase in late 1992.
The more recent statistical indicators, taken
together, point to a resumption of moderate growth
in real GDP in the second quarter. Most notably, on
the positive side, the increase in aggregate hours

828

Federal Reserve Bulletin • September 1993

worked for the quarter as a whole—a useful indicator of movements in overall output—was the largest of the current expansion. Sales of motor vehicles also exhibited considerable vigor. But other
key indicators were less robust. In particular, after
allowing for the effects of the blizzard, consumer
spending on items other than motor vehicles was
lackluster, and housing activity improved only
modestly. In the manufacturing sector, orders generally remained soft, and factory output, after having posted solid gains over the preceding seven
months, is estimated to have declined somewhat
over May and June.
Broad measures of inflation picked up in early
1993, with monthly increases through April in the
upper part of the range of the past couple of years.
Although readings on consumer and producer
prices were much more favorable in May and June,
the cumulative price and wage data for the year to
date suggest that underlying inflation has flattened
out, after having trended down over the preceding
two years. Excluding the especially volatile food
and energy components, the twelve-month change
in the CPI has held in the range of 3 lA to 3l/z percent since the summer of 1992.
In financial markets, short-term interest rates
have changed little so far in 1993, while
intermediate- and long-term interest rates have
fallen 3A to 1 percentage point, reaching their lowest levels in more than twenty years. The decline in
longer-term rates seems largely to have been a
response to the enhanced prospects for credible
fiscal restraint, though the slower pace of economic
expansion may also have played a role. Falling
interest rates have helped stock market indexes set
new records. Despite a decline in the dollar versus
the yen, the average value of the dollar on a tradeweighted basis relative to G-10 currencies has
risen, on balance, since the end of 1992. Although
foreign intermediate-term interest rates have been
down, on average, about as much as U.S. interest
rates, short-term rates abroad have decreased
substantially relative to U.S. rates, as foreign
monetary authorities have taken steps to bolster
weak economies.
Declining U.S. market interest rates contributed
to robust growth in narrow measures of money and
in reserves over the first half of the year, but broad
monetary aggregates were very weak and their
velocities continued to show exceptional increases.




Credit demands on depositories remained quite
subdued relative to spending, considerable depository credit was funded from nonmonetary sources,
and savers continued to demonstrate a marked preference for capital market instruments over money
stock assets.
In part because of the drop in bond and stock
yields, as well as the desire to strengthen balance
sheets, corporate borrowers have continued to concentrate credit demands on long-term securities
markets, using the proceeds in part to repay bank
loans; business loans at banks have not grown this
year, although there were tentative signs of a
pickup over May and June. Total lending and credit
growth at banks has risen only slightly from the
depressed pace of 1992, and these institutions have
therefore not needed to pursue deposits. Thrifts
have continued to contract but at a much slower
pace than in recent years.
Banks have eased lending standards for smaller
firms for several quarters, and they recently relaxed
standards for medium- and large-sized firms as
well. An increased willingness to lend on the part
of banks has been associated with considerably
more comfortable capital positions. Banks have
continued to strengthen their balance sheets by
issuing large volumes of equity and subordinated
debt while retaining a substantial amount of earnings. As a result, the portion of the industry that is
well-capitalized (taking account of supervisory ratings as well as capital ratios) increased from about
one-third at the end of 1991 to more than twothirds by March 1993.
In turning to equity and other nondeposit funds,
banks have reduced the share of depository credit
that is financed by monetary liabilities. Depositors,
for their part, have continued to shift funds into
capital markets, attracted by still-high returns in
these markets relative to earnings on deposits.
Inflows into bond and equity mutual funds have
run at record levels this year, and banks have
facilitated investing in mutual fund products by
increasingly offering them in their lobbies. As a consequence of these various forces, M2 increased at
only a 3A percent annual rate from its fourth-quarter
1992 average through June, while M3 fell slightly.
The sum of M2 and estimated household holdings
of long-term mutual funds grew at about a 43A percent rate from the fourth quarter through June, a
pace little changed from that of recent years.

Monetary Policy Report to the Congress

Debt growth has edged up this year, despite a
deceleration in nominal spending, perhaps buoyed
by improvements in financial positions achieved
over the past few years by both borrowers and
lenders. Investment outlays are estimated to have
exceeded the internal funds of corporations for the
first time in two years, while household borrowing
has picked up relative to spending. In addition,
Treasury financing needs have remained heavy.
Nevertheless, nonfinancial debt has grown at only
a 5 percent rate this year.

Monetary

Objectives for 1993 and 1994

In reviewing the annual ranges for the monetary
aggregates in 1993, the Federal Open Market Committee (FOMC) noted that the relationship of
broadly defined money to income has continued to
depart from historical patterns. The annual velocities of these aggregates last fell in 1986, and their
prolonged upward movements since then strongly
suggest breaks from previous long-run trends of
flat velocity for M2 and slowly decreasing velocity
for M3. The rise in the velocity measures has been
particularly surprising in the last four years, a
period of declining interest rates, normally associated with a reduction in velocity.
In February, anticipating that further balance
sheet restructuring and portfolio shifts from deposits to mutual funds would result in further increases
in velocity, the FOMC lowered the 1993 growth
ranges for M2 and M3 by Vi percentage point from
the provisional ranges set in July 1992. In fact,
velocities of the broad monetary aggregates have
been especially strong; in the first quarter of 1993,
the velocities of M2 and M3 posted substantial

1.

829

increases of 6V4 percent and 8 percent, respectively, and appear to have recorded additional, but
smaller, gains in the second quarter. As a consequence, at its meeting this month, the Committee
reduced the 1993 range for M2 by an additional
percentage point and the range for M3 by another
V2 percentage point, leaving them at 1 to 5 percent
for M2 and 0 to 4 percent for M3.
The reductions of these growth ranges represented further technical adjustments in response to
actual and anticipated increases in velocity and not
a shift in monetary policy, which remains focused
on fostering sustainable economic expansion while
making continued progress toward price stability.
With further substantial increases in velocities,
continued sluggish expansion of M2 and M3,
which are now at the lower ends of their revised
ranges, would be consistent with an acceptable
track for the economy. Also at the July meeting, the
annual monitoring range for the domestic nonfinancial debt aggregate was reduced by V2 percentage
point, to 4 to 8 percent; growth in this aggregate is
likely to continue to be roughly in line with that of
nominal GDP.
Although the future behavior of the velocities
of broad money aggregates was recognized to be
difficult to predict with precision at a time of ongoing structural changes in the financial sector, it
appeared likely that the forces contributing to the
unusual strength in velocities would continue for
some time, and the FOMC carried forward the
revised 1993 ranges for the monetary and debt
aggregates to 1994 as well. With considerable
uncertainty persisting about the relationship of the
monetary aggregates to spending, the behavior of
the aggregates relative to their annual ranges will
likely be of limited use in guiding policy over the
next eighteen months, and the Federal Reserve will
continue to utilize a broad range of financial and
economic indicators in assessing its policy stance.

R a n g e s f o r g r o w t h o f m o n e t a r y and d e b t a g g r e g a t e s 1
Percent

Economic Projections

1993
Aggregate

M2
M3
Debt2

1992

2V2-6V2
1-51

4'/2-8 /2

As of
February
2-6
V2-AV2
4>/2-8>A

As of
July
1-5
0-4
4-8

1-5
0-4
4-8

1. Change from average for fourth quarter of preceding year to average
for fourth quarter of year indicated.
2. Domestic nonfinancial sector.




for 1993 and 1994

1994

The members of the Board of Governors and the
Reserve Bank presidents, all of whom participate
in the deliberations of the FOMC, generally anticipate that economic activity will strengthen in the
second half of 1993 and continue to expand moderately in 1994. The growth of output is likely to be

830

Federal Reserve Bulletin • September 1993

accompanied by further gains in productivity, but
increases in employment are projected to be large
enough to keep the unemployment rate moving
down. Inflation is not expected to change materially over this period.
The economic growth forecasted by the Board
members and Reserve Bank presidents for 1993 is
somewhat weaker than that forecasted in February,
mainly because of the shortfall in reed growth in the
first quarter. Most expect output gains over the
balance of the year to be large enough to result in a
four-quarter change in real gross domestic product
in the range of 2lA percent to 23A percent; for 1994,
the central tendency of the forecasts spans a range
of 2Vi to 3 lA percent. The civilian unemployment
rate, which averaged 7 percent in the second quarter of 1993, is projected to fall to the area of
6 3 A percent by the fourth quarter of this year and to
drop slightly further over the course of 1994.
Recent developments in the financial sphere
should be conducive to the sustained increases in
spending projected for the quarters ahead. The
financial positions of many households and businesses have continued to improve, and banks are
showing signs of greater willingness to make loans.
Short-term interest rates are relatively low, and the
appreciable declines in long-term interest rates over
the past several months should further the process
of balance sheet adjustment and are anticipated to
provide considerable impetus to business investment and residential construction. It is likely that
business investment also will continue to be bolstered by the ongoing push to improve products
and boost efficiency through the use of state-of-theart equipment. Moreover, with at least a moderate
pickup in average growth in foreign industrial

2.

countries, the external sector should be exerting a
less negative influence on economic activity in the
United States.
Despite the improvement in financial conditions,
there are reasons to be cautious about the near-term
outlook. Efforts this year to bring the federal budget deficit under control already have helped to
ease pressures on long-term interest rates, and a
successful agreement to reduce deficits significantly will produce substantial benefits over the
longer run. But such actions also are expected to
exert some restraint on aggregate demand this year
and next. Government outlays for defense will
continue to contract, extending the dislocations and
disruptions that have been evident for some time in
industries and regions that depend heavily on military spending. Prospects for higher taxes may already be influencing the behavior of some households and businesses, and the constraint is likely to
intensify in 1994. In addition, uncertainties about
prospective federal policies reportedly are weighing on businesses and consumers; although the
outcome of the congressional budget deliberations
will be known shortly, uncertainties about health
care reform are not anticipated to be resolved fully
for some time.
Most Board members and Bank presidents
expect the rise in the consumer price index over the
four quarters of 1993 to be in the range of 3 percent
to 3Va percent, about the same as the increase over
the four quarters of 1992. At this stage, the food
and energy sectors are not expected to have much
effect, on balance, on the broad price measures in
1993, but the flooding in the Midwest raises the
risk of higher food prices in the quarters ahead. For
1994, the central tendency forecast is for CPI infla-

E c o n o m i c p r o j e c t i o n s o f F O M C m e m b e r s and other F R B presidents f o r 1 9 9 3 and 1 9 9 4
Percent
1993

1994

Item
Range

Central tendency

Range

Central tendency

Change, fourth quarter to fourth quarter1
Nominal GDP
Real GDP
Consumer price index 2

43A-6'A
2-31/2
3-3 Vi

5-53A
2'/4-23/4
3-3'/4

4'/2-63/4
2-31/4
2-4>/4

5-6V4
2'/2-3'/4
2-3 Vi

Average level, fourth quarter
Unemployment rate3

6'/2-7

63/4

614-7

6V4-6V4

1. Change from average for fourth quarter of preceding year to average
for fourth quarter of year indicated.




2. All urban consumers,
3. Civilian labor force.

Monetary Policy Report to the Congress

tion in the range of 3 to 3V2 percent, not much
different than in 1992 and 1993.
The fundamentals remain consistent with additional disinflation; businesses continue to focus on
controlling costs, and slack in labor and product
markets is anticipated to decrease only gradually in
the period ahead. However, the disappointing price
performance in the first half of the year suggests
that further progress will not come easily—in part
perhaps because inflation expectations remain high.
Lowering inflation and inflation expectations over
time, and achieving sustained reductions in longterm interest rates, will depend importantly on a
monetary policy that remains committed to fostering further progress toward price stability. The
performance of prices and the economy also will
depend on government policies in other areas.
Namely, a sound fiscal policy, a judicious approach
to foreign trade issues, and regulatory policies that
preserve flexibility and minimize the costs they
impose are crucial to reestablishing the disinflation
trend of the past couple of years and allowing the
economy to perform at its full potential.
The Administration has not yet released the midyear update to its economic and budgetary projections. However, statements by Administration officials suggest that the revised forecasts for real
growth and inflation in 1993 and 1994 are not
likely to differ significantly from those of the Federal Reserve.

THE PERFORMANCE
OF THE ECONOMY IN

1993

Economic activity has continued to advance in fits
and starts. After posting robust gains in the second
half of 1992, real GDP rose at an annual rate of less
than 1 percent in the first quarter of 1993. The
slowing in activity was evident in a broad range
of production and spending indicators. The more
recent data suggest that the economy expanded at a
firmer pace in the second quarter, although growth
probably was not as rapid as in the second half of
last year.
To some extent, the slackening in economic
activity in the first quarter of 1993 can be interpreted as a payback after two quarters of strong
growth. In particular, much of the slowing was in
consumer spending, where large gains in the sec


831

ond half of 1992 had outpaced income growth by a
substantial margin. In addition, there was a sharp
contraction in defense spending; although real
defense purchases clearly will remain on a downtrend for some time, the first-quarter plunge followed a spurt in the second half of 1992 and is not
likely to be repeated in coming quarters. In the
external sector, exports declined in the first quarter
after a big increase late last year, while imports
rose markedly. Activity was also depressed, especially in the housing sector, by unusually bad
weather last winter.
Moderate growth in real GDP appears to have
resumed in the second quarter. Nonetheless, experience thus far in 1993 has underscored that the
impediments to a more rapid pace of economic
expansion over the near term remain sizable.
Besides defense cutbacks, the process of balance
sheet adjustment goes on, as do the restructuring
efforts under way at many large firms. Moreover,
the continued disappointing economic performance
of some major foreign industrial countries is taking
a toll on U.S exports. Finally, uncertainties about
prospective federal policies on a variety of fronts,
although difficult to measure, are reportedly making some businesses and consumers reluctant to
make major hiring and spending commitments.
News on the price side was also worrisome in
the first half of the year. Month-to-month movements in prices were on the high side through
April, but they moderated in May and June. The
more favorable recent data helped to ease concerns
that a significant pickup in inflation was under way.
Nonetheless, the disinflation process seemingly has
stalled, with underlying inflation, as measured by
the twelve-month change in the CPI excluding food
and energy, holding in a narrow band between
3V4 percent and 3Vi percent since last summer.

The Household

Sector

Growth of consumer spending on goods and services continued in a stop-and-go pattern in early
1993: It hit a lull in the first quarter after surging in
the second half of 1992. Averaging through the
quarterly data, consumption grew at about a 3 percent annual rate over those three quarters, and
available data point to a moderate increase in the
second quarter. Housing activity appears to have

832

Federal Reserve Bulletin • September 1993

revived in recent months, after sagging earlier in
the year.
Consumer spending increased only about 1 percent at an annual rate in real terms in the first
quarter. Outlays for goods were especially weak,
down at about a 2 percent annual rate; although a
part of the drop was probably attributable to the
severe blizzard on the East Coast in March, signs
of some retreat in spending had already appeared in
January and February. Meanwhile, spending on
services remained on the moderate uptrend that had
been evident for the past few years.
Spending rose appreciably in April, spurred by a
post-blizzard bounce-back in outlays for motor
vehicles and other goods. Demand for motor vehicles remained strong through June, resulting in an
average sales pace for the quarter of almost
14V2 million units (annual rate)—the highest since
early 1990. Sales were boosted by the replacement
needs of households that put off buying vehicles
during the 1990-91 recession and the early recovery period. In addition, price increases—at least for
models with domestic nameplates, which have
accounted for almost all of the rise in sales this
year—have been relatively small, and financing
terms favorable. Meanwhile, real spending on
goods other than motor vehicles appears to have
posted a moderate gain for the quarter as a whole,
and outlays for services rose slowly through May.
The downshift in overall spending growth this
year does not appear to be attributable to any
worsening of the current trends in household incomes and financial positions, but it has coincided
with a deterioration in consumer confidence. In
contrast to the ebullience evident last fall, surveys
conducted by the University of Michigan and the
Conference Board this year have found respondents more pessimistic about their job and income
prospects. Spending may also have been crimped
by smaller-than-usual tax refunds—or larger tax
bills—this year. Although the change in withholding schedules in March 1992 raised workers' takehome pay, and thus provided the wherewithal to
fund additional purchases last year, many households may well have found themselves less liquid
than usual in early 1993. More fundamentally, the
slowing in spending appears to reflect a return to
trend after a surge that outstripped the rise in real
disposable income in the second half of last year.
Indeed, after having risen somewhat over the pre-




ceding couple of years, the personal saving rate
dropped from 5 XA percent in the second quarter of
1992 to 4V2 percent in the fourth quarter, in the
lower part of the range of recent years. The saving
rate retraced some of that decline in the first quarter, but it appears to have fallen back in the spring.
Real disposable income has remained on the
moderate uptrend that has been evident for the past
several quarters: In May, it stood about 2XA percent
above the level of a year earlier. Growth in wages
and salaries has stayed relatively sluggish despite
the firmer pace of employment growth this year.
Meanwhile, transfer payments have continued to
expand, although recent increases have been diminished by a drop in unemployment insurance benefits as the number of unemployed has declined.
Interest income, which fell appreciably over 1992,
has only edged down thus far this year.
Household financial positions have continued to
show signs of improvement. The value of household assets has been buoyed by the rising stock
market, while debt growth has remained moderate.
Moreover, reductions in interest rates have continued to lower debt-servicing burdens; when measured in relation to disposable income, the repayment burden has fallen back to the levels of the
mid-1980s. The incidence of financial stress among
households also appears to have eased further.
Delinquency rates on consumer loans generally
dropped again in the first quarter and are down
significantly from their recent peaks, and delinquencies on home mortgages are at the low end of
the range of the past decade.
Housing activity turned surprisingly soft in the
first quarter, after a burst at the end of 1992. However, the most recent monthly indicators suggest
that the sector remains on a path of gradual expansion. In the single-family area, both starts and sales
of new homes fell back at the beginning of the year
and remained below trend through March. Singlefamily starts rebounded in April and edged up
further in May, lifting the average level for the two
months about 5 percent above the first-quarter
pace; new home sales gyrated in the spring but also
were higher, on average, than in the first quarter.
Undoubtedly, some of the recent improvement
reflects a reversal of transitory factors that damped
homebuilding in the first quarter. The East Coast
blizzard delayed both builders and their customers
in March; in addition, the weather for the nation as

Monetary Policy Report to the Congress

a whole was slightly worse than usual in January
and February. Lumber prices ran up sharply
between October and March: As measured by the
producer price index, prices rose about one-third
over that period, and spot market quotes for some
lumber products more than doubled. The jump in
lumber costs, which has since been reversed, seems
not to have left much of a mark on the prices
recorded in sales transactions; indeed, the inability
of builders to pass along the cost increases may
have accounted for some of the disruption in construction activity.
In any event, low mortgage rates clearly are
helping to stimulate housing demand. Interest rates
on fixed-rate home mortgages, like most other
long-term interest rates, fell to near their twentyyear lows last winter and have since declined further; initial rates on adjustable-rate mortgages have
been the lowest since these loans first became
widely available at the beginning of the 1980s.
Given the trends in house prices, these interest
rates have pushed the cost of home purchase—as
measured by the share of household income needed
to make the mortgage payments on an average
home—to the lowest levels since the mid-1970s.
Nonetheless, the trends in house prices this
year—small rises in some markets, declines in
others—have not been a uniform positive for
demand, mainly because they have muted the
investment motive for owning a home. Moreover,
although most respondents to the Michigan survey
in recent months reported that it was a good time to
buy a house, only about one-third of those who
already owned homes thought it was a good time to
sell. In fact, industry reports suggest that first-time
homebuyers have accounted for an unusually large
share of all home purchases in the past two years,
and that sales and prices in many localities have
been strongest at the lower end of the market.
Construction of multifamily housing this year
has been at its lowest level since the 1950s. These
structures—most of which are intended for rental
use—now account for less than 5 percent of total
residential investment expenditures, compared with
a figure of about 15 percent in the mid-1980s.
Despite the reduced production in the past several
years, vacancy rates and rents have not yet shown
clear signs of tightening for the nation overall. By
contrast, improvements to all existing housing units
have trended up over the past year and now account



833

for nearly one-fourth of total residential construction expenditures.

The Business

Sector

Developments in the business sector generally were
favorable in the first half of 1993. Business fixed
investment, which continued to grow briskly, was
boosted by ample profits and cash flow, the relatively low cost of capital, and ongoing efforts to
improve productivity. Meanwhile, business balance
sheets strengthened further as growth of business
debt remained relatively slow and many firms continued to take advantage of lower bond yields and
high stock prices to enhance liquidity by funding
out short-term liabilities.
Real business fixed investment increased at a
13 percent annual rate in the first quarter of 1993.
Real outlays for equipment posted another healthy
gain, and investment in structures, which had been
on a protracted decline for some time, was about
unchanged for a second quarter. The indicators in
hand suggest that real business fixed investment
remained strong in the second quarter.
Equipment spending has continued to be a mainstay of economic growth. It rose at an annual rate
of about 18 percent in real terms in the first quarter,
after a \2Vi percent rise over the course of 1992.
Real outlays for computers and related devices
have continued to soar; since early 1991, they have
roughly doubled, boosted by product innovations,
extensive price-cutting by computer manufacturers,
and the ongoing efforts of businesses to achieve
efficiencies through the utilization of new
information-processing technologies. However,
demand for other, more traditional types of equipment also began to grow around the middle of 1992
and continued to expand in early 1993. Domestic
purchases of aircraft spurted in the first quarter;
but, given the financial problems besetting the airlines, this increase will likely be reversed in coming quarters.
Investment in nonresidential structures appears
to be stabilizing after several years of steep
declines. Construction outlays were essentially flat
in real terms over the fourth and first quarters, and
the advance indicators suggest that the bottom has
been reached or is close at hand. Trends within the
construction sector have been divergent. In the

834

Federal Reserve Bulletin • September 1993

office sector, the excess of unoccupied space
remains huge, and spending continues to contract.
However, spending for commercial structures other
than office buildings, which also had fallen sharply
over the past several years, has apparently turned
the corner because of both the stronger pace of
retail sales over the past year and the ongoing shift
of retailing activity to large suburban stores. Outlays for industrial construction have not exhibited
the normal cyclical rebound—mainly because utilization of existing capacity has tightened only
gradually—but they seem, at least, to be leveling
out. Meanwhile, activity in the public utilities sector has continued to trend up, mainly because of
capacity expansion at electric utilities but also
because of the installation of pollution abatement
technology, which the Clean Air Act requires be in
place by 1995. In contrast, drilling activity remains
depressed.
Nonfarm business inventories, which had shown
only small changes, on net, since the middle of
1991, rose considerably last winter and spring.
Although the buildup early in the year was likely
motivated in part by the need to replenish stocks
drawn down by surprisingly strong sales in late
1992, some of the recent increase may be attributable to softer-than-expected sales. Notably,
the inventory-sales ratio for non-auto retail
stores remained in May around the high end of
the range of recent years. By contrast, inventories
at factories and at wholesale trade establishments
generally seem to be reasonably well aligned with
sales.
After advancing markedly over the course of
1992, economic profits of U.S. corporations were
little changed overall in the first quarter of 1993.
The pretax profits earned by nonfinancial corporations on their domestic operations weakened after a
fourth-quarter surge, but they still stood nearly
35 percent above the cyclical low reached in 1991;
the upswing in these profits over the past two years
has reflected primarily a combination of moderation in labor costs and reductions in net interest
expenses. Domestic profits of financial corporations have been buffeted in recent quarters by the
losses that insurance companies sustained from
major natural disasters; without such losses, domestic financial profits in the first quarter would have
surpassed the high reached in the first quarter of
1992.




The farm economy has been beset by numerous
weather disruptions so far this year. In the first
quarter, severe weather in some regions retarded
livestock production and damaged fruit and vegetable crops. In many regions, spring planting was
hampered by wet weather, and, in parts of the
Midwest, continued heavy rains around mid-year
caused major flooding. Because of the planting
delays and the floods, uncertainties about acreage
and yields are considerably greater than usual for
this time of year, and farmers in the flooded regions
obviously have suffered financial losses.
Despite the weather-related supply disruptions,
farm income and farm financial conditions for the
nation as a whole seem to have held up reasonably
well in the first half of 1993. On average, farm
prices in the first half were slightly above those of a
year earlier, with declines for farm crops being
offset by higher prices for livestock. Farm subsidies, which have been running well above their
1992 pace, have been lifting farm income and cash
flow, and farm investment in new machinery has
picked up. The recent jump in crop prices—a consequence of the flooding—will boost the incomes
of the many farm producers whose crops are still in
good condition.

The Government

Sector

Governments at all levels continue to struggle with
budgetary difficulties. At the federal level, the unified budget deficit over the first eight months of
fiscal year 1993—the period from October to
May—totaled $212 billion, somewhat less than
during the comparable period of fiscal 1992. However, excluding deposit insurance and adjusting for
the inflow of contributions to the Defense Cooperation Account in fiscal 1992, the eight-month deficit
was about $230 billion in both fiscal years. In the
main, the underlying deficit has failed to drop
because the restraint in discretionary spending that
was legislated in 1990 and the deficit-closing
effects of stronger economic activity have been
offset by continued large increases in spending for
entitlement programs.
In total, federal outlays in the first eight months
of fiscal 1993 were only about 2 percent higher
than during the same eight months of fiscal 1992.
Outlay growth was damped significantly by a sharp

Monetary Policy Report to the Congress

swing in net outlays for deposit insurance that
was attributable largely to the improved health
of depository institutions. In fact, so far this year,
receipts from insurance premiums and proceeds
from sales of assets taken over by the government
have exceeded by $ 18 V2 billion the gross outlays to
resolve troubled institutions. Defense spending was
also quite weak in the first eight months of fiscal
1993. Outlays for Medicare and Medicaid continued to rise rapidly; however, the increase so far this
year—about 10 percent—was only half as large as
the one in the preceding year. The deceleration in
health care spending appears to stem, in part, from
federal regulations issued in 1992 that limit the
states' ability to shift Medicaid costs to the federal
government.
Federal purchases of goods and services—the
part of federal spending included directly in gross
domestic product—declined at an annual rate of
18 percent in real terms in the first quarter of 1993.
A sharp decrease in defense spending more than
accounted for the drop. Real defense purchases
have been falling noticeably since early 1991, but
the decline has been erratic; at least part of the
first-quarter plunge can be interpreted as a correction after a few quarters of surprisingly strong
spending. Meanwhile, real nondefense purchases
have been almost flat over the past couple of
quarters.
Federal receipts in the first eight months of fiscal
1993 were about 5 percent greater than in the same
period of a year earlier; the rise was roughly the
same as that in nominal GDR Boosted by the
upswing in business profits, corporate taxes rose
sharply. However, they account for less than onetenth of total receipts, and growth in other categories was only moderate in the aggregate.
States and localities continue to face sizable budget deficits: As measured in the national income
and product accounts (NIPA), the combined deficit
(net of social insurance funds) in the sector's operating and capital accounts has been stuck around
$40 billion since late 1990. These outsized deficits
have persisted despite ongoing efforts by many
governments to adjust spending and taxes. As at
the federal level, deficit reduction has been complicated by the upsurge in payments to individuals for
health and income support; in the first quarter of
1993, state and local transfer payments for Medicaid and Aid to Families with Dependent Children



835

(in nominal terms) were nearly 20 percent above
those of a year earlier.
The deficit-reduction efforts of state and local
governments in recent quarters have been concentrated on the spending side. Their purchases of
goods and services were nearly flat in real terms in
the first quarter of 1993 and have changed little, on
net, since early 1992. Outlays for construction,
which fell at an annual rate of 7 percent, on average, in the fourth and first quarters, have been
especially weak. For all major categories except
sewer and water, outlays in recent months have
been running significantly below year-earlier levels. State and local employment has continued to
expand at the somewhat slower pace that has been
evident since 1991, while these governments have
continued to hold the line on wages and benefits.
The approximately 3Vz percent increase in state
and local compensation rates over the year ended
in March was similar to the rise for workers in
private industry; by contrast, in the 1980s, state and
local workers received increases that, on average,
were more than 1 percentage point per year greater
than those in private industry.
Receipts of state and local governments,
restrained by the relatively tepid cyclical upswing
in the sector's tax bases, have grown only moderately over the past year. Also, these governments
have lately been reluctant to raise taxes, after the
sizable hikes they enacted in 1990 and 1991. All
told, the sector's own-source general receipts,
which comprise income, corporate, and indirect
business taxes, rose 5 percent over the four quarters
ended in the first quarter of 1993, an increase about
the same as that in nominal GDP.

The External

Sector

Since December 1992, the trade-weighted foreign
exchange value of the dollar has risen about 5 percent, on balance, in terms of the currencies of the
other Group of Ten (G-10) countries. This net
increase has reflected much larger movements in
the dollar's value against individual currencies: In
particular, a sharp decline against the Japanese yen
was more than offset by substantial increases
against major European currencies.
Relative to the monthly average for December
1992, the dollar has declined nearly 15 percent

836

Federal Reserve Bulletin • September 1993

against the yen to record lows, prompting heavy
Japanese official purchases of dollars and moderate
dollar purchases by U.S. authorities. The strengthening of the yen has occurred despite the weak
performance of the Japanese economy and market
expectations that Japanese short-term interest rates
will remain near historically low levels over the
next year; it seems to be based largely on the
perception that Japan's external surplus, which has
grown rapidly over this period, is not sustainable.
Against the German mark, the dollar has risen
almost 10 percent since December, reflecting a
substantial easing of German interest rates and the
expectation of further declines in light of the sharp
contraction in German economic activity. The dollar has also appreciated against other European
currencies, and it has remained little changed
against the Canadian dollar.
Economic activity in the major foreign industrial
countries generally has been sluggish so far this
year. The recovery in Canada now seems to be
reasonably well established, and real GDP in the
United Kingdom has been growing slowly. However, continental Europe remained in recession in
the first quarter, with a sizable reduction in real
GDP in western Germany; recent indicators point
to continued weakness in the second quarter. After
falling for much of 1992, Japanese real GDP
advanced in the first quarter, a rise in large part
reflecting the effects of earlier fiscal measures;
however, indicators for the second quarter are
mixed, and the appreciation of the yen will likely
result over time in a drag on net exports.
Unemployment rates have continued to rise (into
the double-digit range in many instances) in the
countries still in recession; even in the countries
showing signs of recovery, unemployment has
remained high. Partly as a consequence, wage pressures have ebbed, and underlying inflation has continued to decelerate, on average. A notable exception is western Germany, where the CPI rose more
than 4 percent over the twelve months ended in
June, partly because of an increase in the valueadded tax early this year and large increases in the
prices of housing services.
In contrast to the overall weakness of activity in
foreign industrial countries, real growth so far this
year in major developing countries, especially in
Asia, appears to have remained at around the strong
pace of 1992.



After expanding rapidly at the end of 1992, real
merchandise exports declined during the first quarter of 1993, but they bounced back to their fourthquarter 1992 high in April and May. Shipments to
developing countries, which had risen sharply over
1992, dropped back during the January-to-May
period. In the aggregate, exports to industrial countries rose somewhat in the first five months of
1993, but Canada and the United Kingdom
accounted for most of the increase.
Real merchandise imports, extending the rapid
pace of growth recorded over the four quarters of
1992, rose sharply over the first five months of
1993. Trade in computers continued to soar and
was responsible for about one-third of the increase
in merchandise imports. More broadly, imports
were boosted by the rapid growth of U.S. domestic
final demand in the second half of 1992 and inventory restocking this year. In addition, the prices of
non-oil imports, reflecting the lagged effects of the
appreciation of the dollar during the last quarter of
1992, fell somewhat in the first quarter; much of
that decline appears to have been reversed in the
second quarter. The price of oil imports fluctuated
in a relatively narrow range over the first half of
1993. Mild weather and strong OPEC production
pushed oil prices down early in the year, but prices
subsequently retraced the decline on signs that
OPEC would effectively curb production. Recently,
oil prices have dropped on Kuwait's decision not to
participate in OPEC's quota allocations for the
third quarter and speculation that Iraq may be
allowed to resume exporting sooner than had been
expected.
The merchandise trade deficit widened to
$116 billion (at an annual rate) in the first quarter
of 1993, nearly $10 billion greater than in the
second half of 1992; it increased somewhat further
in April and May, on average. With moderate
increases in net income from direct investments
and a slight further widening of the surplus on net
service transactions, the deficit in the current
account deficit rose somewhat less than the trade
deficit, to $89 billion (annual rate) in the first
quarter, compared with $83 billion in the second
half of 1992.
Net capital inflows recorded in the first quarter
of 1993 were largely attributable to substantial
increases in foreign official assets held in the
United States, particularly in those of some newly

Monetary Policy Report to the Congress

industrializing Asian economies and of certain
Latin American countries. Net private capital
inflows were relatively small. Private foreigners
added significantly to their holdings of U.S. securities, particularly Treasury bonds. However, U.S.
net purchases of foreign bonds reached record levels, and net purchases of foreign stocks, although
down from peak levels reached in the last half of
1992, remained heavy. New bond issues by foreigners in the United States also were very strong.
Capital inflows associated with foreign direct
investment in the United States recovered substantially in the first quarter but remained far below the
peaks reached in 1989. Foreign direct investment
in the United States apparently has been deterred
by unfavorable returns realized on earlier investments and by financial market conditions less
favorable to acquisitions. In contrast, capital outflows associated with U.S. direct investment abroad
remained strong.

Labor Market

Developments

The labor market showed signs of improvement in
the first half of 1993. According to the payroll
survey, employment increased about 1 million; this
number compares with a rise of about 600,000 over
the second half of last year and brings the total
increase since the cyclical low in 1991 to about
2 million.
Nonetheless, job gains have continued to fall far
short of the norms set by earlier business cycle
expansions. For example, only in May did payroll
employment return to its pre-recession peak, two
years after the cyclical trough; by contrast, recessionary job losses typically have been reversed
within the first year of the expansion. Job growth
has continued to be restrained by the temperate
pace of economic activity and employers' ongoing
efforts to improve productivity. In addition, firms
are confronting cost pressures associated with sizable increases in health insurance premiums and in
other fringe benefits; uncertainties about the future
course of government policies may also be contributing to the reluctance of some firms to expand
their permanent full-time work forces.
Moreover, firms are relying increasingly on temporaiy workers, in part because doing so affords
them greater flexibility in responding to fluctua


837

tions in demand for their products. Indeed, employment at personnel supply firms, which consist
largely of temporary-help agencies, rose more than
150,000 between December and June. Over the
past two years, the increase has been about
500,000; thus, although these firms currently
account for less than 2 percent of total payroll
employment, they are responsible for one-quarter
of the increase in total employment over this
period.
Job gains in the first half of 1993 also reflected a
continuation of the steady uptrend in employment
in health services. In addition, gains occurred
at trade establishments, construction payrolls
improved with the recent stronger housing activity,
and there were scattered increases in services other
than health and personnel supply.
Meanwhile, manufacturing employment declined
further, on balance, over the first six months of the
year. Although factory output increased steadily
through April, firms relied mainly on a combination of productivity improvements and longer
workweeks to meet their output objectives; in May
and June, output decreased somewhat. Job losses in
the first half were concentrated in the durable goods
sector, with particular weakness at producers of
aircraft and motor vehicles. Since its last peak in
January 1989, manufacturing employment has
fallen about 13A million; layoffs in defense-related
industries (those industries that depend on defense
expenditures for at least 50 percent of their output)
have accounted for about one-fifth of the decrease
in total factory payrolls.
Employment as measured by the monthly survey
of households rose about 900,000 over the first six
months of the year—essentially the same as in the
payroll series. The number of unemployed fell
appreciably at the beginning of the year, and the
civilian unemployment rate dropped from 7.3 percent in December to 7.0 percent in February; it has
shown little change since that time.
The civilian labor force expanded only moderately over the first six months of 1993—less than
1 percent at an annual rate. Labor force growth
continued to be damped by the relatively small
increase in the working-age population. In addition, perceptions of meager employment opportunities evidently continued to deter many potential job
seekers. The labor force participation rate, which
measures the percentage of the working age popu-

838

Federal Reserve Bulletin • September 1993

lation that is either employed or looking for work,
spurted in late spring; however, this spurt followed
a sharp decline earlier in the year, and the level at
mid-year was about the same as that in late 1992.
Output-per-hour in the nonfarm business sector
declined at an annual rate of IV2 percent in the first
quarter, echoing the sharp deceleration in output.
Nonetheless, the first-quarter drop followed a string
of sizable increases; all told, the rise in productivity
over the year ended in the first quarter of 1993 was
IV2 percent—smaller than the gains recorded earlier in the economic expansion but still noticeably
larger than the norms for the past decade. Productivity growth in the manufacturing sector, where
downsizing and restructuring efforts have been
under way for some time, has continued to be
especially impressive, totaling more than 5 percent
over the past year.
Labor compensation has tilted up of late. The
employment cost index for private industry—a
measure that includes wages and benefits—rose at
an annual rate of 4lA percent over the first three
months of the year. Even so, the data are volatile,
and the total increase since March 1992 amounted
to only 3V2 percent; by contrast, this index had
risen 4XA percent over the preceding twelve
months, and, as recently as early 1990, the twelvemonth change had exceeded 5 percent. The
increase in wages over the past year was less than
3 percent, whereas the cost of fringe benefits,
pushed up by the steep rise in the cost of medical
insurance and by higher payments for workers'
compensation, rose more rapidly. Primarily because
of the drop in productivity, unit labor costs deteriorated markedly in the first quarter, but they still
were up less than 2 percent over the past year.

Price

Developments

Inflation exhibited considerable month-to-month
volatility in the first half of the year. Broad measures of inflation picked up somewhat in early
1993, with monthly readings through April in the
upper part of the range of the past couple of years.
However, price changes at the consumer and the
producer levels were small in May and June. Cutting through the monthly data, the disinflation
process evident in 1991 and 1992 seems to have
stalled, with underlying inflation, as measured by



the twelve-month change in the CPI excluding food
and energy, holding in the range of 3 XA percent to
31/2 percent that has prevailed since last summer.
The total CPI, held down by essentially flat energy
prices, has risen 3 percent over the past twelve
months.
The CPI for food increased at an annual rate of
2 percent in the first half of 1993, a shade above the
rate of increase during 1992. Meat prices jumped
sharply during the first few months of the year as
production fell short of year-earlier levels. In addition, the prices of fresh vegetables were boosted
during the spring by weather-related production
setbacks in several regions of the country. By late
spring, these supply problems had abated, and the
June CPI brought price declines in food categories
where the sharpest upward pressures previously
had been evident. Since the end of June, however,
farm crop prices have moved up in response to the
severe flooding in the Midwest. The increases in
crop prices have already been reflected in the
form of large advances in some commodity price
indexes and have raised the possibility that
renewed upward pressures on consumer food prices
could soon emerge.
Consumer energy prices changed little, on net,
over the first half of the year. With world oil
markets remaining relatively quiescent, the price of
West Texas intermediate generally fluctuated
between $18 and $20 per barrel but has weakened
recently. Retail prices for refined petroleum products changed fairly little on the whole through
April and dropped, on balance, in May and June.
Residential natural gas prices rose considerably
over the first half, in part because of inventory
adjustments associated with last winter's colderthan-usual weather; although recent declines in
wellhead prices suggest that some of the increase at
the retail level may be retraced in coming months,
over the longer haul, natural gas prices are being
supported by an ongoing shift toward the use of
cleaner-burning fuels.
All told, the CPI excluding food and energy
increased at an annual rate of 3XA percent over the
first half of the year, after rising 3 percent over the
second half of 1992. The CPI for goods soared in
January and February, with large increases reported
for several items. Apparel prices jumped early in
the year, in part because strong sales in late 1992
limited the need for post-Christmas markdowns.

Monetary Policy Report to the Congress

Some retailers may also have seen opportunities to
widen profit margins on other merchandise; the
recent decrease in prices of home furnishings, for
example, suggests that not all of these increases
stuck.
Increases in prices of non-energy services were
steadier but also somewhat larger than in 1992.
Part of the step-up was in shelter costs, which
account for about half of non-energy services and
had posted some unsustainably small increases last
summer. However, the substantial deceleration in
medical care prices (for both goods and services)
that has been in train over the past few years
extended into 1993. In fact, the CPI for medical
care rose only about 6 percent over the twelve
months ended in June; this increase was among the
smallest of the past decade.
To some extent, the higher underlying CPI inflation rates in the first half of 1993 may be a statistical phenomenon that will be reversed in the second
half: Indeed, over the past several years, price
increases early in the year have tended to exceed
those for the year as a whole, even after seasonal
adjustment by the Bureau of Labor Statistics. But,
even allowing for this phenomenon, inflation seems
to have leveled out. The lack of further deceleration is puzzling in light of the considerable slack in
labor and product markets. One possible explanation is that the pickup in economic activity late last
year may have triggered a round of price increases;
if so, some deceleration in prices is likely in the
wake of the subdued performance of the economy
in the first half. Another may be the apparent
failure of inflation expectations, as measured by
various surveys of consumers and businessmen, to
reflect fully the reduction in actual inflation over
the past few years; although the survey measures
vary considerably, respondents seem to share a
sense that inflation has bottomed out.
Prices received by domestic producers have
slowed in recent months, after undergoing a pickup
earlier in the year. All told, the twelve-month
change in the producer price index for finished
goods other than food and energy was less than
2 percent in June, down somewhat from a year
earlier. At earlier stages of processing, where price
movements tend to track cyclical fluctuations in
demand, prices of intermediate materials (excluding food and energy) firmed a little early in the
year, but they subsequently moderated; although



839

the pattern was exaggerated by the spike in lumber
prices, it was evident for some other materials as
well. In commodity markets, prices of precious
metals have moved up sharply over the past couple
of months, and some scattered increases have been
evident elsewhere. More broadly, however, industrial commodity prices were down slightly, on net,
over the first half of the year.

MONETARY AND FINANCIAL
IN 1993

DEVELOPMENTS

Monetary policy in 1993 has been directed toward
the goal of sustaining the economic expansion
while preserving and extending the progress made
toward price stability in recent years. In the first
half of the year, economic activity slowed markedly from the very rapid pace of the fourth quarter,
while inflation indicators fluctuated widely.
Although inflation readings were a source of concern for the Federal Open Market Committee, the
intensification of price pressures did not seem
likely to be sustained over an extended period, and
reserve conditions were kept unchanged. With
short-term rates steady, prices of fixed-income
securities were buoyed by prospects for significant
fiscal restraint and by a slowing of the economic
expansion, although fears of a pickup in inflation at
times prompted partial reversals in bond rates.
Yield spreads on private securities relative to Treasury rates remained historically narrow, and stock
price indexes set new records.
The monetary aggregates have been sluggish this
year, as both the share of depository institutions in
overall debt finance and the proportion of depository credit funded with monetary liabilities have
fallen further. The reduced role for depositories
largely reflects weak demands for loans and deposits by the public. Corporate borrowers have continued to issue heavy volumes of stocks and bonds in
part to pay down bank debt, while households have
withdrawn deposits to invest in bond and equity
funds that finance, among others, corporate issuers.
After two years of no growth, bank loans weakened
further early this year, but increased fairly vigorously in May and June, posting a small net gain
for the first six months of the year. The growth of
nonfinancial sector debt so far this year has edged
up from the subdued pace of 1992, despite a decel-

840

Federal Reserve Bulletin • September 1993

eration of nominal spending, as investment spending is estimated to have exceeded the internal funds
of corporations, household borrowing has picked
up relative to spending, and Treasury financing
needs have remained heavy.

The Implementation

of Monetary

Policy

Early in the year, incoming data suggested that the
faster pace of economic activity that had emerged
in the third quarter of 1992 had been maintained
through year-end. Indicators of industrial production, retail sales, business fixed investment, and
residential construction activity all posted solid
gains. Financial impediments to the expansion
appeared to be diminishing as the balance sheets of
households, business firms, and financial institutions continued to improve, although money and
credit growth remained weak. Wage and price data
suggested a continuing trend toward lower inflation. Intermediate- and long-term interest rates had
declined somewhat, in part reflecting a view that
the new Administration's fiscal stimulus package
was likely to be modest and that material reductions in future deficits were in prospect. The
economic outlook remained clouded, however, by
uncertainties regarding details of fiscal policy
plans, continued restructuring and downsizing of
large businesses, and lingering restraints on credit
supplies. At its early February meeting, the FOMC
decided that its directive to the Federal Reserve
Bank of New York regarding domestic open market operations should retain a symmetric stance
regarding possible reactions over the intermeeting
period to incoming indicators; such a directive,
which implied no presumption in how quickly
changes in operations should be made toward tightness or ease, had been instituted in December,
following directives that had been biased toward
easing over much of the previous two years.
Economic activity appeared to decelerate in the
early months of the year, however, in part because
of adverse weather conditions, with softness in
retail sales, housing starts, and nonresidential construction. Bank credit was failing to expand significantly, while broad money was declining because
of temporary factors and a weak underlying trend.
Although short-term interest rates were little
changed, bond markets rallied further on weaker



economic activity and improved prospects for fiscal restraint, which would reduce the government's
demand for credit. Long-term rates fell to the lowest levels in almost twenty years in early March,
before backing up somewhat on reports of a second
month of substantial increases in consumer and
producer prices. The drop in interest rates buoyed
stock markets to record highs and contributed to a
small decline in the weighted-average value of the
dollar. The dollar depreciated substantially against
the yen, as market attention focused on Japan's
growing trade surplus.
Signs of price pressures were a concern for the
FOMC, but the fundamentals of continued slack in
labor and capital utilization, subdued unit labor
costs, and protracted weakness in credit and broad
money suggested that a higher trend inflation rate
was not setting in. With the economy slowing,
reserve pressures were kept unchanged and a symmetric policy directive was retained at the meeting
in March.
After pausing in March, producer and consumer
prices leaped again in April. Long-term interest
rates backed up further in response; the price of
gold surged, and the dollar fell more rapidly. With
the Japanese authorities buying dollars in foreign
exchange markets, the U.S. Treasury and the Federal Reserve also purchased dollars for yen in late
April. After extended weakness, the monetary
aggregates jumped in early May by more than
could be explained by temporary factors.
At its May meeting, the FOMC was confronted
with weak output growth and intensified inflation readings. It was difficult to identify reasons
for this juxtaposition. Price increases by business
firms in early 1993 could have reflected optimism
engendered by strong demand conditions in the
second half of 1992 or an upward adjustment of
inflation expectations. However, considerable slack
remained in labor and product markets, and the
pace of economic activity had slowed markedly.
The Committee concluded that no policy adjustment was needed at its meeting, but the risks of
increased inflation and inflation expectations warranted a directive that contemplated a relatively
prompt tightening of reserve pressures if signs of
intensifying inflation continued to multiply.
The subsequent readings on inflation for May
and June were subdued; moreover, evidence of
heightened inflation expectations did not emerge in

Monetary Policy Report to the Congress

markets for fixed-income securities. Consequently,
the stance of monetary policy was not changed
following the May FOMC meeting. The dollar
rebounded on foreign exchange markets in June
and early July in the wake of the fall of the Japanese government and evidence that economic conditions in Europe had deteriorated further.
On balance, since the beginning of the year,
short-term interest rates are little changed, while
intermediate- and long-term rates have fallen 3A to
1 percentage point, reaching the lowest levels in
more than twenty years. In particular, the thirtyyear Treasury bond has reached a low of 6.54 percent, while the ten-year Treasury note has touched
5.71 percent, its lowest level since 1971. The interest rate on fixed-rate thirty-year mortgages has
dropped to 7.16 percent, a record low in the
twenty-two year history of the series. The fall in
intermediate-term interest rates in the United States
was roughly matched on average abroad, and the
trade-weighted value of the dollar in terms of G-10
currencies has increased about 5 percent from its
December average, as overseas economies weakened and foreign short-term rates declined
substantially.

Monetary

and Credit

Flows

Growth of the broad money measures was quite
slow over the first half of 1993, falling below the
subdued pace of 1992, and leaving them near the
lower arms of the revised growth cones for 1993.
This deceleration did not, however, reflect a moderation in overall credit flows or a tightening in
financial conditions. Rather, it resulted from a further diversion of credit flows from depository institutions as well as continued financing of depository
credit through capital accumulation rather than
deposits. Indeed, growth of the debt of all nonfinancial sectors is estimated to have edged up this
year—to 5 percent—despite an apparent slowing in
nominal GDR Continued substantial demand for
credit by the federal government as well as more
comfortable financial positions and consequent
signs of a greater willingness to borrow and lend
by private sectors likely supported debt expansion.
Nevertheless, overall debt growth remains in the
lower portion of its revised 4 to 8 percent annual
range for 1993. Nonfederal debt growth has



841

expanded at a still-modest VA percent pace, after
two years of even weaker growth.
Taking advantage of low long-term interest rates
and the strong stock market, businesses have issued
an exceptionally large volume of bonds and equity;
the proceeds have been used mainly to refund other
marketable debt and repay bank loans. Stresses
associated with the restructuring of the economy
and the earlier buildup of debt linger. However,
downgradings of corporate debt by rating agencies
have dropped well below the peak levels of a few
years ago, and a growing number of firms have
received upgradings, as corporate cash flows have
strengthened substantially relative to interest
expenses.
Debt service burdens of households also have
continued to decline relative to disposable income,
as households have repaid high interest debt or
taken advantage of lower rates to refinance. Indeed,
the decline in long-term interest rates during the
year has brought a new surge of refinancings of
mortgages. With balance sheets improved, households have become somewhat more willing to borrow, and consumer credit has begun growing moderately after two years of weakness. Some of that
growth, though, may reflect heavy promotion of
credit cards carrying special incentives for use in
transactions, such as "frequent-flier miles" or merchandise discounts. Net mortgage debt is estimated
to have grown only a bit more than the low rate of
1992.
Gross issuance of state and local government
debt has been particularly robust this year. However, refunding volume has accounted for nearly
70 percent of the offerings, compared with about
45 percent in 1992, a record year for refundings.
Net debt of state and local governments has grown
only moderately again in 1993. The budgetary situations of some state and local governments have
improved, as tax receipts have been stronger than
expected, but severe financial problems remain in
other locales.
With corporate borrowers still relying heavily on
financing through capital markets, and depository
lending spreads over market rates remaining high,
the trend decline in the share of total credit flows
provided by depository institutions was extended
through the first half of 1993. From the fourth
quarter of 1992 to June, bank credit expanded at a
4lA percent annual rate, only a slight pickup from

842

Federal Reserve Bulletin • September 1993

the sluggish pace of the previous two years. Securities acquisitions accounted for most of the expansion, as loans increased at only a PA percent rate.
The growth of securities portfolios at banks in part
reflects additions to holdings of securitized mortgage and consumer loans; bank financing of consumer spending and real estate transactions is thus
stronger than indicated by bookings of loans in
those sectors. Although commercial and industrial
loans have been about flat on balance so far this
year, a few signs of easing in bank lending terms
and conditions have recently emerged, and business loans rebounded in May and June. Judging by
business loan growth at smaller banks so far this
year, a pickup has occurred in lending to smaller
nonfinancial firms. Thus, the continuing weakness
in overall business loan growth does not appear to
be driven primarily by restrictive supply conditions
but rather by the preference of larger firms to fund
through capital markets.
Lower market interest rates over the past few
years have helped strengthen the financial positions
of banks and thrifts. The lower rates have resulted
in capital gains on securities and improved interest
margins—as deposit rates have fallen more than
lending rates. Lower rates also have helped bank
borrowers by decreasing interest expenses and
boosting economic activity, thereby reducing loan
loss provisions for banks. Banks posted record
earnings in 1992 and remained very profitable in
early 1993; prices of their shares on equity markets
have risen substantially.
Thrift institutions have continued to contract in
1993, though at a much slower pace than over the
past four years. A lack of funding for the Resolution Trust Corporation caused a hiatus in the closure of institutions under its conservatorship. However, privately operated thrifts have not expanded
and the industry continues to consolidate.
Slower growth in nominal GDP, moderate
demand for credit relative to spending, and the
reduced share of credit provided by depositories
have all contributed to the lack of significant
growth in the broad monetary aggregates this year.
Another factor inhibiting money growth has been
continued substantial funding of bank and thrift
assets with subordinated debt and equity issues
as well as with retained earnings—all a byproduct
of ongoing efforts to build capital positions. Only
about one-third of the industry (by asset volume)



had capital ratios and supervisory ratings high
enough at the end of 1991 to be considered wellcapitalized, but more than two-thirds was so positioned by early 1993. About $10 billion was added
to bank equity and subordinated debt during the
first quarter, a pace about the same as that in 1992;
data on new debt and equity issues indicate another
sizable gain over the second quarter.
Depositories have also recently relied more
heavily on other nondeposit sources of funds. Weak
economies and credit demand abroad have
prompted the U.S. offices of foreign banks to draw
more funding from overseas and the domestic
offices of U.S. banks to reduce foreign lending this
year. Overall shifts from deposits to other sources
of funding may be driven partly by regulatory
inducements—including higher insurance premiums on deposits and incentives to bolster capital.
But changes in investor preferences from shortterm deposits to longer-term debt and equity may
also be playing a role in motivating the restructuring of bank and thrift sources of funds.
Greater reliance by borrowers on capital markets
has been facilitated by concurrent shifts in saving
preferences away from monetary assets and into
capital market investments. Such portfolio realignments are evident in record inflows to bond and
stock mutual funds, and money balances were also
likely invested directly in stocks and bonds. The
incentives for what appears to be an extraordinary
adjustment of household portfolios are varied.
Interest rates paid on retail time deposits, NOW
accounts, and money market deposit accounts
(MMDAs) have fallen well below any rate offered
since the inception of deregulated deposits in the
early 1980s, and savings deposit rates are now the
lowest in more than thirty years. The shock effect

3.

Distribution of assets of domestic commercial banks,
by adjusted capital c a t e g o r y 1
Percent
End of year
Capital category

Well capitalized
Adequately capitalized ...
Undercapitalized

1991

1992

34
45
21

68
22
10

March
1993
70
20
10

1. Capital categories adjusted for overall supervisory rating according to
the rule of thumb of downgrading a bank by one category for a low
examination rating by its supervisory agency (CAMEL 3,4, or 5).

Monetary Policy Report to the Congress

of historically low deposit interest rates caused
many depositors to investigate alternative investments. With the yield curve extraordinarily steep,
much higher returns have been available in recent
years on longer-term investments. A bond or stock
mutual fund offers investors a chance to earn these
higher yields and still enjoy liquidity features,
including in some cases a check-writing facility.
However, investment in such a mutual fund carries
with it a higher risk of loss as well, because unlike
monetary assets, its principal value fluctuates with
market prices. Indeed, the higher yield on bonds
relative to short-term instruments probably anticipates some capital losses. Whether all households
accurately assess relative risks when comparing
returns recently earned on mutual funds with those
on money balances remains an open question.
Shifts into mutual funds have become much easier and less costly for households, most notably
because many banks have begun offering mutual
funds for sale in their lobbies. While many banks
now offer discount brokerage services, a survey by
the Federal Reserve found that larger banks have
recently been making special efforts to promote
mutual fund investments among their depositors.
An increasing number of banks have sponsored
their own mutual funds or entered into exclusive
sales relationships with nonbank sponsors of funds.
Some banks have promoted these products as a
defensive measure to retain long-run relationships
with valued depositors. In other cases, however,
banks have promoted funds as part of a strategy to
earn fee income without booking assets, thereby
avoiding the need to raise additional capital.
Substitution between money and long-term
mutual funds appears to have become evident in
the aggregate data in recent years. There was little
increase in such funds from 1987 through 1990, but
inflows have surged since then, at the same time
that accretions to M2 balances have declined. A
comparison of the quarterly growth rates of M2
and the sum of M2 and bond and stock funds
shows that growth of the sum has not weakened as
dramatically as that of M2 over the last two and
half years; it has averaged nearly a 5 percent annual
rate, compared with less than 2 percent for M2.
Although adding mutual funds and M2 together
captures some substitution out of M2 in recent
years, the total remains quite volatile, indicating
that other forces have affected both M2 and mutual




843

funds. Partly as a consequence, the relationship of
the total to aggregate spending is subject to considerable uncertainty. Investments in bond and stock
funds are themselves subject to potentially volatile
capital gains and losses. More fundamentally, with
the public's holdings of mutual funds now vastly
expanded, its responses to a variety of interest rate
and stock price movements has yet to be tested.
Because weakness in the demand for broad
money has resulted largely from shifts of portfolio
preferences rather than changes in spending intentions, it has not been reflected in comparable weakness in nominal GDP. Furthermore, the effects of a
declining share for depositories in overall credit
growth have been substantially offset by increased
funding through capital markets, where households
now invest a larger share of wealth. The velocity of
M2 has been subject to extraordinary and unpredictable surges that have reduced the value of M2
as a guide to policy. Traditional models of velocity
based on the difference between short-term market
interest rates and interest rates on deposits and
money market mutual funds, and even broader
models that take account of longer-term interest
rates and after-tax loan rates faced by households,
cannot explain the full 4 percent rise in M2 velocity in 1992, nor what may be a somewhat faster
rate of increase in the first half of 1993.
Money growth in the first quarter was depressed
in part by the effects of several temporary factors,
including distortions of seasonal factors and a lull
in mortgage refinancing. A renewed surge of mortgage refinancing began to bolster demand deposits
and MMDAs in April, as mortgage servicers
increased balances temporarily before making
remittances to investors in mortgage-backed securities. The seasonal-factor distortions began to
reverse that month as well. However, substantial
shortfalls in individual nonwithheld tax payments
relative to recent years produced an offsetting
restraint to money growth in April, as the buildup
of balances required to pay taxes was smaller than
that incorporated into seasonal factors. Even
excluding estimated effects of these special factors,
however, underlying growth of money through the
first four months of the year was far weaker than
historical relationships would suggest.
Despite continued heavy inflows to bond and
equity funds in May, the monetary aggregates
surged, boosted in part by a reversal of the tax

844

Federal Reserve Bulletin • September 1993

effects and an intensification of mortgage refinancing activity. However, the aggregates decelerated
substantially in June, and by more than might be
suggested by a waning of tax and mortgage
refinancing effects.
In 1993, household portfolio adjustments differed somewhat from their previous pattern. In the
past, the realignment of household wealth toward
capital market investments had mainly involved
shifts from money market mutual funds and small
time deposit accounts. At the same time, outflows
from those accounts had also gone into NOW and
savings deposits, the interest rates on which were
falling only slowly as market rates declined. This
year, the sum of all these M2 balances has fallen at
about the same rate as in 1992, but a slower runoff
of small time deposits and money funds has been
offset by a sharp deceleration in the growth of
NOW and savings deposits. Catch up declines in
interest rates on liquid deposits may account for
part of their slower growth. Some nontransactions
balances held in NOW and MMDA deposits have
likely been shifted into bond and equity funds. It
may be that some depositors who do not ordinarily

4.

shop for small rate advantages have been induced
to make basic portfolio adjustments because of the
historically low deposit interest rates and the
increased ease of making investments in capital
market instruments.
Partly as a result, narrow measures of money
have decelerated this year, but their expansion has
remained rapid. M l has grown at a 9Vi percent rate
from the fourth quarter of 1992 through June, compared with 141/* percent in 1992. Reserves, now
held exclusively against transaction deposits, have
grown at an 11 percent pace compared with 20 percent in 1992. The monetary base has slowed by
much less, because of continued strong foreign
demand for currency this year.
With reduced strength in its M l component, and
in savings and MMDAs, as well as continued runoffs of small time deposits and retail money funds,
M2 has grown at only a 3A percent annual rate from
the fourth quarter of 1992 through June 1993, well
below the lower end of its growth cone set in
February. The FOMC monitored the behavior of
M2 carefully over the first half of the year, but in
light of actual and expected strength of velocity,

Growth of money and debt
Percent
Domestic nonfinancial debt
Ml

Period

M2

M3
Total

Nonfederal

1

Annual, fourth quarter to fourth quarter
1980
19812
1982
1983
1984

7.4
5.4 (2.5)
8.8
10.4
5.5

1985
1986
1987
1988
1989
1990
1991
1992
Semiannual (annual rate)3
1993:H1

8.9
9.3
9.1
12.2
8.1

9.5
12.3
9.9
9.9
10.8

9.5
10.0
9.3
11.4
14.3

9.0
9.7
7.4
8.8
13.9

12.0
15.5
6.3
4.3
.6

8.7
9.3
4.3
5.3
4.7

7.6
8.9
5.8
6.4
3.7

13.8
14.0
10.1
9.2
8.2

13.3
13.7
10.4
9.6
8.5

4.3
8.0
14.3

4.0
2.8
1.8

1.8
1.1
.3

6.8
4.4
4.8

5.9
2.5
2.9

8.7

.1

-.7

5.1

3.3

6.6
10.6

-2.0
2.2

3.8
2.4

4.4
5.7

3.0
3.6

9.5

.8

-.3

5.1

3.3

4

Quarter (annual rate)
1993:Q1
Q2

Fourth quarter 1992 average to June 1993 average
(annual rate)5

1. From average for fourth quarter of preceding year to average for fourth
quarter of year indicated.
2. Ml adjusted for shift to NOW accounts in 1981.
3. From average for 1992:Q4 to average for 1993:Q2 (for debt, estimated
with data through May).




4. From average for preceding quarter to average for quarter indicated (for
debt, estimated with data through May).
5. For debt, to May 1993 average.

Monetary Policy Report to the Congress

the Committee determined that actions to boost M2
growth were not needed to achieve its underlying
objectives for prices and the economy. The aggregate is near the lower arm of the revised annual
growth cone established in July, and if velocity
continues to increase substantially, M2 may well
come in toward the lower end of the revised growth
range for the year.
The non-M2 portion of M3 has declined this
year at nearly the same pace as that of the previous




845

two years. Large time deposits have continued to
fall, and the halt in reductions in short-term rates
has ended the rapid growth of institutional money
funds, as their slower-adjusting yields have come
down to their usual relationship to market interest
rates. From the fourth quarter of 1992 through
June, M3 fell at about a LA percent annual rate; it
lies slightly below its revised annual growth
cone.
•

846

Industrial Production and Capacity Utilization
for June 1993
Released for publication

July 16

Industrial production, which was unchanged in
May, declined 0.2 percent in June. The output of
consumer goods, construction supplies, and materials decreased; the production of business equip-

ment, which posted significant advances earlier this
year, edged up for a second month. At 110.1 percent of its 1987 annual average, total industrial
production was the same in June as it had been in
March but was 3.8 percent above its year-earlier
level. For the second quarter as a whole, industrial

Industrial production indexes
Twelve-month percent change

Twelve-month percent change

1988

1989

1990

1991

1992

1988

1993

1989

1990

1992

1991

1993

Capacity and industrial production
Ratio scale, 1987 production = 100

Ratio scale, 1987 production = 100
— Total industry

140

Capacity
-

— Manufacturing

Capacity

140

-

120

-

Production

1

1

1

1

1

1

1

Production

80
1

1

1

1

1

1

1

1

1

1

1

1

80
1

1

Percent of capacity

1

1

1

Percent of capacity
Manufacturing

Total industry
90

90
Utilization

Utilization

J
1981

1983

120
100

100

1985

1987

80

80

70

70

L
1989

1991

1993

1981

1983

1985

All series are seasonally adjusted. Latest series, June. Capacity is an index of potential industrial production.




1987

1989

1991

1993

847

Industrial production and capacity utilization1
Industrial production, index, 1987=100
Percentage change
Category

1993
1993:
r

Mar.

r

Apr.

r

May

JuneP

Tbtal

110.1

110.4

110.3

110.1

Previous estimate

110.1

110.2

110.4

109.5

109.5
108.3
134.4
95.9

109.4
107.9
134.7
96.9

Major market groups
Products, total*
Consumer goods ...
Business equipment
Construction supplies
Materials
Major industry groups
Manufacturing
Durable
Nondurable
Mining
Utilities

108.6

133.4
96.4
110.9
110.8

114.1
106.6
95.3
117.8

111.6

111.3
114.8
107.0
96.4
115.0

111.6

109.1
107.1
134.9
96.3
111.6

111.2
114.7
106.9
96.9
114.9

110.8
114.3
106.6
96.3
116.4

r

Mar.

r

r

Apr.

May

Junef
-.2

3.8

4.0
2.9

.3

-.1

.0

-.4

-.3
-.7

1.3
-1.1

1.1

.2

.0
.3
.3

.5

.2

.3

.6

-.6

1.2

.2

-2.4

.1

10.6

-.7

.0

-.1

2.9
3.5

-.1

-.3
-.4
-.3
-.7
1.3

4.0

-.1
-.1
.6
.0

1992

Total
Manufacturing
Advanced processing
Primary processing ..
Mining
Utilities

Low,
1982

High,
1988-89

1.3
-.8
5.8

1993

June

Mar.r

Apr.r

Mayr

Junep

Capacity,
percentage
change,
June 1992
to
June 1993

81.9

71.8

84.8

79.5

81.6

81.7

81.5

81.2

1.6

81.2
80.7
82.2
87.4
86.7

70.0
71.4
66.8
80.6
76.2

85.1
83.3
89.1
87.0
92.6

78.6
77.0
82.2
86.3
83.9

80.6
79.3
83.8
85.3
89.0

80.9
79.5
84.2
86.4
86.8

80.7
79.2
84.1
86.9
86.7

80.3
78.8
83.8
86.4
87.8

1.8
2.2
.8
-.9
1.2

1. Data seasonally adjusted or calculated from seasonally adjusted
monthly data.
2. Change from preceding month.

production rose at a 1.9 percent annual rate, down
from 5.5 percent in the first quarter. Utilization of
total industrial capacity eased again in June, to
81.2 percent.
When analyzed by market group, the data show
that the output of consumer goods fell 0.7 percent;
the bulk of the decline was in the production of
consumer durables. Assemblies of both automobiles and light trucks were cut for a second month.
Moreover, sizable drops in the output of appliances
and room air conditioners contributed to a 1.5 percent decrease in the output of other durable consumer goods. The production of nondurable consumer goods declined for the third consecutive
month. In June, reductions in the output of clothing, food, and automotive gasoline more than offset
an increase in sales of residential electricity.
The small gain in the production of business
equipment reflected a continued increase in the




6.2

MEMO

Capacity utilization, percent

Average,
1967-92

June 1992
to
June 1993

3. Contains components in addition to those shown,
r Revised,
p Preliminary.

output of information-processing equipment that
offset another drop in transit equipment. The production of defense and space equipment continued
to contract and has fallen 9 percent in the past
twelve months. Because of a sharp drop in lumber
production, the output of construction supplies
decreased 0.7 percent in June, after having risen
more than 1 percent in May. Over the past two
months, the production of both durable and nondurable materials has changed little, while the output
of energy materials has fallen because of the widening coal strike.
When analyzed by industry group, the data show
that within manufacturing, output decreased
0.3 percent; capacity utilization slipped 0.4 percentage point, to 80.3 percent, which was about the
same rate as in January and nearly 1 percentage
point below the 1967-92 average. Utilization in
advanced-processing industries declined to

848

Federal Reserve Bulletin • September 1993

78.8 percent in June, about 2 percentage points
below its longer-run average. Although the operating rate for primary-processing industries also
declined, it remained 1.6 percentage points above
its longer-run average.
The output of both durable and nondurable goods
slackened in June. The weakness in durables was
concentrated in motor vehicles, aircraft, and lumber. Motor vehicle output, which fell off after having held steady in the first part of 1993, remained




well above its year-ago level. In contrast, aircraft
output has fallen for nearly two years. Small
declines were widespread among nondurable manufacturing industries in June, with only printing
and publishing and chemicals increasing.
The output at mines fell 0.7 percent, with the
production cut in coal and other mining industries
far exceeding a gain in the drilling of oil and gas
wells. The output at utilities rose 1.3 percent.
•

849

Statement to the Congress
Statement by Alan Greenspan, Chairman, Board
of Governors of the Federal Reserve System,
before the Subcommittee on Economic Growth
and Credit Formation of the Committee on Banking, Finance and Urban Affairs, U.S. House of
Representatives, July 20, 1993
Thank you for this opportunity to discuss the
Federal Reserve's semiannual monetary policy
report to the Congress. 1 My remarks this morning will cover current monetary policy and economic settings as well as the Federal Reserve's
longer-term strategy for contributing, to the best
of its abilities, to the nation's economic wellbeing.
As economic expansion has progressed somewhat fitfully, our earlier characterization of the
economy as facing stiff headwinds has appeared
increasingly appropriate. Doubtless the major
headwind in this regard has been the combined
efforts of households, businesses, and financial
institutions to repair and rebuild their balance
sheets after the damage inflicted in recent years
as weakening asset values exposed excessive
debt burdens.
But there have been other headwinds as well.
The builddown of national defense has cast a
shadow over particular industries and regions of
the nation. Spending on nonresidential real estate
dropped dramatically in the face of overbuilding
and high vacancy rates and has remained in the
doldrums. At the same time, corporations across
a wide range of industries have been making
efforts to pare employment and expenses to
improve productivity and their competitive positions. These efforts have been prompted, in part,
by innovative technologies that have been applied to almost every area of economic endeavor
and have boosted investment. However, their

1. See "Monetary Policy Report to the Congress," in this
issue.




effect on jobs and wages through much of the
expansion has also made households more cautious spenders.
In the past several years, as these influences
have restrained the economy they have been
balanced, in part, by the accommodative stance
of monetary policy and, more recently, by declines in longer-term interest rates as the prospects for credible federal deficit cuts improved.
From the time monetary policy began to move
toward ease in 1989 until now, short-term interest rates have dropped more than two-thirds and
long-term rates have also declined substantially.
All along the maturity spectrum, interest rates
have come down to their lowest levels in twenty
or thirty years, aiding the repair of balance
sheets, bolstering the cash flow of borrowers,
and providing support for interest-sensitive
spending.
The process of easing monetary policy, however, had to be closely controlled, and generally
gradual, because of the constraint imposed by
the marketplace's acute sensitivity to inflation.
As I pointed out in my February testimony to the
Congress, this constraint did not exist in earlier
years. Before the late 1970s, financial market
participants and others apparently believed that
although inflationary pressures might surface occasionally, the institutional structure of the U.S.
economy simply would not permit sustained inflation. But as inflation and, consequently, longterm interest rates soared into the double digits at
the end of the 1970s, investors became painfully
aware that they had underestimated the economy's potential for inflation. As a result, monetary
policy in recent years has had to remain alert to
the possibility that an ill-timed easing could be
undone by a flare-up of inflation expectations,
pushing long-term interest rates higher and shortcircuiting essential balance sheet repair.
The cumulative monetary easing over the past
four years has been very substantial. Since last
September, however, no further steps have been

850

Federal Reserve Bulletin • September 1993

taken, as the stance of policy has appeared
broadly appropriate to the evolving economic
circumstances.
That stance has been quite accommodative,
especially judging by the level of real short-term
interest rates in the context of moderate economic growth, on average. Short-term real interest rates have been about zero over the past three
quarters. In maintaining this accommodative
stance, we have been persuaded by evidence of
persistent slack in labor and product markets,
increasing international competitiveness, and a
decided absence of excessive credit and money
expansion. The forces that engendered past inflationary episodes appear to have been lacking
to date.
Yet some of the readings on inflation earlier
this year were disturbing. It appeared that prices
might be accelerating despite product market
slack and an unemployment rate that was noticeably above estimates of the so-called "natural"
rate of unemployment—that is, the rate at which
price pressures remain roughly constant. In the
past, the existing degree of slack in the economy
had been consistent with continuing disinflation.
History tells us, however, the inflation outcome depends not only on the amount of slack
remaining in labor and product markets but on
other factors as well, including the rate at which
that slack is changing. If the economy is growing
rapidly, inflation pressures can arise, even in the
face of excess capacity, as temporary bottlenecks emerge and as workers and producers
raise wages and prices in anticipation of continued strengthening in demand. Near the end of
last year, about the time many firms probably
were finalizing their plans for 1993, sales and
capacity utilization were moving up markedly
and optimism about future economic activity
surged. This optimism may well have set in
motion a wave of price increases, which showed
through to broad measures of prices earlier this
year.
Moreover, inflation expectations, at least by
some measures, appear to have tilted upward this
year, possibly contributing to price pressures.
The University of Michigan survey of consumer
attitudes, for example, reported an increase in
the inflation rate that is expected to prevail over
the next twelve months from about 3VA percent in




the fourth quarter of last year to nearly 4Vi
percent in the second quarter. Preliminary data
imply some easing of such expectations earlier
this month, but the sample from which those data
are derived is too small to be persuasive. Moreover, the price of gold, which can broadly reflect
inflationary expectations, has risen sharply in
recent months. And at times this spring, bond
yields spiked higher when incoming news about
inflation was most discouraging.
The role of expectations in the inflation process is crucial. Even expectations not validated
by economic fundamentals can themselves add
appreciably to wage and price pressures for a
considerable period, potentially derailing the
economy from its growth track.
Why, for example, despite an above-normal
rate of unemployment and permanent layoffs,
have uncertainties about job security not led to
further moderation in wage increases? The answer appears to lie, at least in part, in the
deep-seated anticipations understandably harbored by workers that inflation is likely to reaccelerate in the near term and undercut their real
wages.
The Federal Open Market Committee (FOMC)
became concerned that inflation expectations
and price pressures, unless contained, could
raise long-term interest rates and stall economic
expansion. Consequently, at its meeting in May,
while affirming the more accommodative policy
stance in place since last September, the FOMC
also deemed it appropriate to initiate a so-called
asymmetric directive. With its bias in the direction of a possible firming of policy over the
intermeeting period, this directive did not prejudge that action would be taken—and indeed
none was taken. But it did indicate that further
signs of a potential deterioration of the inflation
outlook would merit serious consideration as to
whether short-term rates needed to be raised
slightly from their relatively low levels to ensure
that financial conditions remained conducive to
sustained growth.
Certainly the May and June price figures have
helped assuage concerns that new inflationary
pressures had taken hold. Nonetheless, on balance, the news on inflation this year must be
characterized as disappointing. Despite disinflationary forces and continued slack, the rate of

Statement to the Congress

inflation has at best stabilized, rather than easing
further as past relationships would have suggested.
In assessing the stance of monetary policy and
the likelihood of persistent inflationary pressures, the FOMC took into account the downshift in the pace of economic expansion earlier
this year. This downshift left considerable remaining slack in the economy and promised that
the adverse price movements prompted by the
acceleration in growth late last year would likely
diminish.
Although a slowdown from the unsustainably
rapid growth in the latter part of last year had
been anticipated, the deceleration was greater
than expected. A surprisingly precipitous drop in
defense spending, a sharp deterioration in net
exports, a major blizzard, and some inevitable
retrenchment by consumers converged to yield
only meager gains in output in the first quarter.
But growth apparently picked up in the second
quarter, and nearly one million net new jobs were
created over the first half of the year. Smoothing
through the quarterly pattern, the economy appears to have accelerated gradually over the past
two years, to maintain a pace of growth that
should yield further reductions in the unemployment rate. Consequently, the evidence remains
consistent with our diagnosis that the underlying
forces at work are keeping the economy generally on a moderate upward track. However, as I
have often emphasized, not all the old economic
and financial verities have held in the current
expansion, and changes in fiscal policy will have
uncertain effects in the future. Thus, caution
remains appropriate in assessing the path for the
economy.
Financial conditions have improved considerably, lessening the need for balance sheet restructuring that has been damping economic activity for several years. By no means is the
process over, but good progress has been made.
On the one hand, debt service burdens, eased by
lower interest rates and lower debt-equity ratios,
have fallen substantially in both the business and
household sectors. On the other hand, the economies of several of our major trading partners
have been quite weak, constraining the growth of
demand for our exports.
Although expectations of a significant, credible



851

decline in the budget deficit have induced lower
long-term interest rates and favorably affected
the economy, the positive influence thus far is
apparently being at least partly offset by some
business spending reductions as a consequence
of concerns about the effects of pending tax
increases.
It seems that the prospective cuts in the deficit
are having a variety of substantial economic
effects, well in advance of any actual change in
taxes or in projected outlays. Moreover, uncertainty about the final shape of the package may
itself be injecting a note of caution into private
spending plans. In addition, uncertainty about
the outlook for health care reform may be affecting spending at least in that industry.
To be sure, the conventional wisdom is that
budget deficit reduction restrains economic
growth for a time, and I suspect that is probably
correct. However, over the long run, conventional wisdom points in the opposite direction. In
fact, one can infer that recent declines in longterm interest rates are bringing forward some of
these anticipated long-term gains. As a consequence, the timing and magnitude of any net
restraint from deficit reduction are uncertain.
Patently, the overall economic effect of fiscal
policy, especially when combined with the uncertainties of the forthcoming health care reform
package, has imparted several unconventional
unknowns to the economic outlook.
However, assuming that we constructively resolve over time the major questions about federal
budget and health care policies, with further
waning of earlier restraints on growth the U.S.
economy should eventually emerge healthier and
more vibrant than in decades. The balance sheet
restructuring of both financial and nonfinancial
establishments in recent years should leave the
various sectors of the economy in much better
shape and better able to weather untoward developments. Similarly, the ongoing efforts by
corporations to pare expenses are putting our
firms and our industries in a better position to
compete both within the U.S. market and globally. And after a period of some dislocation the
contraction in the defense sector will ultimately
mean a freeing-up of resources for more productive uses. Finally, a credible and effective fiscal
package would promise an improved outlook for

852

Federal Reserve Bulletin • September 1993

sustained lower long-term interest rates and a
better environment for private sector investment. All told, the productive capacity of the
economy will doubtless be higher and its resilience greater.
Over the past two years, the forces of restraint
on the economy have changed, but real growth
has continued, with one sector of the economy
after another taking the lead. Against this background, Federal Reserve Board governors and
Reserve Bank presidents project that the U.S.
economy will remain on the moderate growth
path it has been following as the expansion has
progressed. Their forecasts for real GDP average
about 2Vi percent from the fourth quarter of 1992
to the fourth quarter of 1993 and cluster around
21/2 percent to 3lA percent over the four quarters
of 1994. Reflecting this moderate rise and the
outlook for labor productivity, unemployment is
generally expected to edge lower, to about 63A
percent by the end of this year and to perhaps a
shade lower by the end of next year. For this
year as a whole, FOMC participants see inflation
at or just above 3 percent, and most of them have
about the same forecast for next year.
Besides focusing on the outlook for the economy at its July meeting, the FOMC, as required
by the Humphrey-Hawkins Act, set ranges for
the growth of money and debt for this year and,
on a preliminary basis, for 1994. One premise of
the discussion of the ranges was that the uncharacteristically slow growth of the broad monetary
aggregates in the past couple years—and the
atypical increases in their velocities—would persist for a while longer. M2 has been far weaker
than income and interest rates would have predicted. Indeed, if the historical relationships between M2 and nominal income had remained
intact, the behavior of M2 in recent years would
have been consistent with that of an economy in
severe contraction. To an important degree, the
behavior of M2 has reflected structural changes
in the financial sector: The thrift industry has
downsized by necessity, and commercial banks
have pulled back as well, largely reflecting the
burgeoning loan losses that followed the lax
lending of earlier years. With depository credit
weak, there has been little bidding for deposits,
and depositors in any case have been drawn to
the higher returns on capital market instruments.



Inflows to bond and stock mutual funds have
reached record levels, and, to the extent that
these inflows have come at the expense of growth
in deposits or money market mutual funds, the
broad monetary aggregates have been depressed.
In this context, the FOMC lowered the 1993
ranges for M2 and M3—to 1 percent to 5 percent
and 0 percent to 4 percent respectively. This
lowering represents a reduction of 1 percentage
point in the M2 range and Vi percentage point for
M3. Even with these reductions, we would not
be surprised to see the monetary aggregates
finish the year near the lower ends of their
ranges.
As I emphasized in a similar context in February, the lowering of the ranges is purely a technical matter; it does not indicate, nor should it be
perceived as, a shift of monetary policy toward
restraint. It is indicative merely of (1) the state of
our knowledge about the factors depressing the
growth of the aggregates relative to spending, (2)
the course of the aggregates to date, and (3) the
likelihood of various outcomes through the end
of the year. Although the lowering of the range
reflects our judgment that shifts out of M2 will
persist, the upper end of the revised range allows
for a resumption of more normal behavior or
even some unwinding of M2 shortfalls. The
FOMC also lowered the 1993 range for debt of
the domestic nonfinancial sectors Vi percentage
point, to 4 percent to 8 percent. The debt aggregate is likely to come in comfortably within its
new range, as it continues growing about in line
with nominal GDP. The new ranges for growth of
money and debt in 1993 were carried over on a
preliminary basis into 1994.
In reading the longer-run intentions of the
FOMC, one should interpret the specific ranges
cautiously. The historical relationships between
money and income and between money and the
price level have largely broken down, depriving
the aggregates of much of their usefulness as
guides to policy. At least for the time being, M2
has been downgraded as a reliable indicator of
financial conditions in the economy, and no
single variable has yet been identified to take its
place.
At one time, M2 was useful both to guide
Federal Reserve policy and to communicate the
thrust of monetary policy to others. Even then,

Statement to the Congress

however, a wide range of data was routinely
evaluated to assure ourselves that M2 was capturing the important elements in the financial
system that would affect the economy. The
FOMC never single-mindedly adhered to a narrow path for M2, but persistent and sizable
deviations of that aggregate from expectations
were a warning sign that policy and the economy
might not be interacting in a way that would
produce the desired results. The so-called
" P - s t a r " model, developed in the late 1980s,
embodied a long-run relationship between M2
and prices that could anchor policy over extended periods of time. But that long-run relationship also seems to have broken down with
the persistent rise in M2 velocity.
M2 and P-star may reemerge as reliable indicators of income and prices once (1) the yield
curve has returned to a more normal configuration, (2) borrowers' balance sheets have been
restored and traditional credit demands resume,
(3) savers have adjusted to the enhanced availability of alternative investments, and (4) depositories finally have reached a comfortable size
relative to their capital and earnings. In the
meantime, the process of probing a variety of
data to ascertain underlying economic and financial conditions has become even more essential
to formulating sound monetary policy. This general approach obviously has its weaknesses.
When one examines many indicators, one can
always find some that counsel against actions
that later appear to have been necessary.
In these circumstances, it is especially prudent
to focus on longer-term policy guides. One important guidepost is real interest rates, which
have a key bearing on longer-run spending decisions and inflation prospects.
In assessing real rates, the central issue is their
relationship to an equilibrium interest rate, specifically the real rate level that, if maintained,
would keep the economy at its production potential over time. Rates persisting above that level,
history tells us, tend to be associated with slack,
disinflation, and economic stagnation, and rates
below that level tend to be associated with eventual resource bottlenecks and rising inflation,
which ultimately engender economic contraction. Maintaining the real rate around its equilibrium level should have a stabilizing effect on the



853

economy, directing production toward its longterm potential.
The level of the equilibrium real rate—or more
appropriately the equilibrium term structure of
real rates—cannot be estimated with a great deal
of confidence, though it can be estimated with
enough confidence to be useful for monetary
policy. Real rates, of course, are not directly
observable but must be inferred from nominal
interest rates and estimates of inflation expectations. The most important real rates for private
spending decisions almost surely are the longer
maturities. Moreover, the equilibrium rate structure responds to the ebb and flow of underlying
forces affecting spending. So, for example, in
recent years the appropriate real rate structure
doubtless has been depressed by the headwinds
of balance sheet restructuring and fiscal retrenchment. Despite the uncertainties about the levels
of equilibrium and actual real interest rates,
rough judgments about these variables can be
made and used in conjunction with other indicators in the monetary policy process. Currently,
short-term real rates, most directly affected by
the Federal Reserve, are not far from zero;
long-term rates, set primarily by the market, are
appreciably higher, judging from the steep slope
of the yield curve and reasonable suppositions
about inflation expectations. This configuration
indicates that market participants anticipate that
short-term real rates will have to rise as the
headwinds diminish if substantial inflationary imbalances are to be avoided.
Although our guides for policy may have
changed recently, our goals have not. As I have
indicated many times to this committee, the
Federal Reserve seeks to foster maximum sustainable economic growth and rising standards of
living. And in that endeavor, the most productive
function the central bank can perform is to
achieve and maintain price stability.
Inflation is counterproductive in many ways.
Of particular importance, increased inflation has
been found to be associated with reduced growth
of productivity, apparently in part because it
confounds relative price movements and obscures price signals. Compounding this negative
effect, under the current tax code, inflation raises
the effective taxation of savings and investment,
discouraging the process of capital formation.

854

Federal Reserve Bulletin • September 1993

Because productivity growth is the only source
of lasting increases in real incomes and because
even small changes in growth rates of productivity can accumulate over time to large differences
in living standards, productivity growth's association with inflation is of key importance to policymakers.
The link between the control of inflation and
the growth of productivity underscores the importance of providing a stable backdrop for the
economy. Such an environment is especially
important for an increasingly dynamic market
economy, such as ours, in which technology and
telecommunications are advancing rapidly. New
firms, new products, new jobs, new industries,
and new markets are continually being created,
and they are unceremoniously displacing the old
ones. The U.S. economy is a dynamic system
that is always renewing itself. It is extraordinary
that the system overall is as stable as it is,
considering the persistent process of change in
the structure of our economy. For example, a
frequently cited figure is the two million new jobs
that have been created since the end of 1991.
This is a net change, however, which masks the
many millions of people who found, lost, and
changed jobs over the same period. Currently,
people are being hired at a pace of approximately
400,000 per week, while job losses are running
modestly below that figure. Such vast churning in
the nation's labor markets is a normal and ultimately a productive process.
Central planning of the type that prevailed in
postwar Eastern Europe and the Soviet Union
represented one attempt to fashion an economic
system that eliminated this competitive churning
and its presumed wastefulness. But when that
system eliminated the risk of failure, it also
stifled the incentive to innovate and to prosper.
Central planning fostered stasis: In many respects, the eastern bloc economies marched in
place for more than four decades.
Risk-taking is crucial in the process that leads
to a vital and progressive economy. Indeed, it is
a necessary condition for wealth creation. In a
market economy, competition and innovation
interact; those firms that are slow to innovate or
to anticipate the demands of the consumer are
soon left behind. The pace of churning differs by
industry, but it is present in all. At one extreme,




firms in the most high tech areas must remain
constantly on the cutting edge, as products and
knowledge rapidly become obsolete. Many products that were at technology's leading edge, say
five years ago, are virtually unsalable in today's
markets. In high tech fields, leadership can shift
rapidly. In some markets in which American
firms were losing share just a few years ago, we
have regained considerable dominance. In one
case, U.S. firms have seized a commanding lead
in just two years in the new laptop computer
market, and now these firms account for more
than 60 percent of U.S. sales last year, triple the
figure for Japanese firms.
More generally, it appears that the pace of
dynamism has been accelerating. One indication
is that the average economic life expectancy of
new capital equipment has been falling. The
average life of equipment purchased in 1982, for
example, was I6V2 years. By 1992 that figure had
declined to W/2 years, a decline more than twice
as large as that over the preceding decade. In
addition, telecommunications technology is obviously quickening the decisionmaking process
in both financial and product markets.
In such a rapidly changing marketplace, the
agile survive by being flexible. One aspect of this
flexibility has been the spread of "just-in-time"
inventory controls at manufacturing firms. Partly
as a result of innovations in inventory control
techniques, the variability of inventories relative
to total output appears to be on a downtrend.
The possibility of failure has productive side
effects, encouraging economic agents to do their
best to succeed. But there are nonproductive and
unnecessary risks as well. There is no way to
avoid risk altogether, given the inherently uncertain outcomes of all business and household
decisions. But many uncertainties and risks do
not foster economic progress, and when feasible
should be suppressed. A crucial risk in this
category is that induced by inflation. To allow a
market economy to attain its potential, the unnecessary instability engendered by inflation
must be quieted.
A monetary policy that aims at price stability
permits low long-term interest rates and helps
provide a stable setting to foster the investment
and innovation by the private sector that are key
to long-run economic growth. In pursuing our

Statement to the Congress

objectives, we must remain acutely aware that
the structure of the economy has been changing
and growing ever more complex. The relationships between the key variables in the economy
are always shifting to a degree, and this evolution presents an ongoing challenge to the business leader, to the econometric modeler, and to
those responsible for the conduct of economic
policy.
Clearly, the behavior of many of the forces
acting on the economy over the course of the last
business cycle has been different from what had
gone before. The sensitivity of inflation expectations has been heightened, and, as recent evidence suggests, businesses and households may
be becoming more forward-looking with respect
to fiscal policies as well.
I believe we are on our way toward reestablishing the trust in the purchasing power of the

dollar that is crucial to maximizing and fulfilling
the productive capacity of this nation. However,
the public clearly remains to be convinced. Survey responses and financial market prices embody expectations that the current lower level of
inflation not only will not be bettered, but it will
not even persist. But there are glimmers of hope
that trust is reemerging. For example, issuers
have found receptive markets in recent months
for fifty-year bonds. This had not happened in
decades. The reopening of that market may be
read as one indication that some investors once
again believe that inflationary pressures will remain subdued.
It is my firm belief that, with fiscal consolidation and with the monetary policy path that we
have charted, the United States is well positioned to remain at the forefront of the world
economy well into the next century.
•

Chairman Greenspan presented identical testimony before the Committee on Banking,
and Urban Affairs, U.S. Senate, July 22, 1993.




855

Housing,

856

Announcements
APPOINTMENT OF NEW PRESIDENT OF THE
FEDERAL RESERVE BANK OF NEW YORK

The Federal Reserve Bank of New York announced
on July 16, 1993, that William J. McDonough, who
had been Executive Vice President at that Bank,
had been appointed President, effective July 19,
1993. Mr. McDonough will succeed E. Gerald
Corrigan, who retired.
Mr. McDonough, fifty-nine, had been Executive
Vice President of the New York Reserve Bank's
financial markets group and the manager of open
market operations for the Federal Reserve System's Federal Open Market Committee. He was
chosen as the New York Federal Reserve Bank's
eighth chief executive by the Bank's board of
directors, and his appointment was confirmed on
July 16, 1993, by the Federal Reserve's Board of
Governors.
He joined the Bank in January 1992, after a
twenty-two-year career at First Chicago Corp.
and its bank, First National Bank of Chicago. He
retired from First Chicago in 1989 as vice chairman of the board and a director of the bank holding
company.
Mr. Corrigan announced his retirement plans in
January. He had been president of the Federal
Reserve Bank of New York since January 1985.

ACTIONS TO EASE FINANCIAL STRESS IN
AREAS IN THE MIDWEST AFFECTED BY
FLOODING

The Federal Reserve Board announced on July 23,
1993, a series of steps designed to help ease financial stress in areas affected by flooding in the
Midwest.
A supervisory statement adopted by the Board
encourages financial institutions to work constructively with borrowers who are experiencing difficulty because of the flooding.



The statement says that banks may find it appropriate to ease credit terms to help new borrowers
restore their financial strength, consistent with prudent banking practices, and to restructure debt or
extend repayment terms for existing borrowers.
The Board also waived appraisal regulations for
real estate related transactions affected by the
flooding, and temporarily amended its Regulation Z (Truth in Lending) to provide relief under
waiver rules so that borrowers may gain ready
access to loan funds when they use their primary
dwelling as collateral for a loan.
Under the right of rescission, a borrower normally has three business days to cancel a loan
contract when it is secured by the borrowers's
principal dwelling.
ERRATUM: BULLETIN TABLE 1.27
The second part of table 1.27, "Assets and Liabilities of Large Weekly Reporting Commercial
Banks," on page A23 of the August issue of the
Bulletin was printed incorrectly. The previous
month's data, for the period March 3, 1993,
through April 28, 1993, were printed instead of the
current data for that issue. The correct data, for the
period March 31, 1993, through May 26, 1993, are
shown opposite, on page 857.
AVAILABILITY OF REVISED LISTS OF OTC
MARGIN STOCKS AND OF FOREIGN MARGIN
STOCKS

The Federal Reserve Board published on July 23,
1993, a revised list of over-the-counter (OTC)
stocks that are subject to its margin regulations. It
also published the List of Foreign Margin Stocks
for foreign equity securities that met the criteria in
Regulation T (Credit by Brokers and Dealers).
The lists are effective August 9,1993, and supersede the previous lists that were effective May 10,
1993.

857

1.27 ASSETS AND LIABILITIES OF LARGE WEEKLY REPORTING COMMERCIAL BANKS—Continued
Millions of dollars, W e d n e s d a y figures

1993
Account
Mar.

31 R

Apr.

7

Apr.

14

Apr.

21

Apr.

28F

May

5

May

12

May

19

May

26

LIABILITIES

46 Deposits
47
Demand deposits
48
Individuals, partnerships, and corporations
49
Other holders
50
States and political subdivisions
51
U.S. government
52
Depository institutions in the United States . . .
53
Banks in foreign countries
54
Foreign governments and official institutions . .
55
Certified and officers' cheeks
56
Transaction balances other than demand deposits 4 .
57
Nontransaction balances
58
Individuals, partnerships, and corporations
59
Other holders
60
States and political subdivisions
61
U.S. government
62
Depository institutions in the United States . . .
63
Foreign governments, official institutions, and banks .
64 Liabilities for borrowed money 5
65
Borrowings from Federal Reserve Banks
66
Treasury tax and loan notes
,
67
Other liabilities for borrowed money
68 Other liabilities (including subordinated notes and
debentures)
69 Total liabilities
70 Residual (total assets less total liabilities) 7

1,102,691
268,659
221,814
46,845
8.891
2,347
20,348
5,083
712
9,463
119,220
714,812
692,241
22,571
20,151
487
1,597
336

1,118,220'
269,695'
221,337'
48,358
8,371
2,048
22,061
4,929
1,177
9,772
122,088
726,437
702,918'
23,519'
20,513'
492
2,183'
332

1,126,069'
279,838'
230,158'
49,680
8,727
3,343
21,916
4,962
687
10,046
122,233
723,997
700,707'
23,290'
20,251'
495
2,208'
336

1,095,355'
260,032'
211,797R
48,234'
8,997
3,590
21,496'
4,884
646
8,622
118,945
716,378
691,264'
25,114'
20,349'
2,199
2,232'
333

1,101,564
272,144
220,729
51,416
9,214
2,737
23,068
4,821
613
10,963
114,964
714,456
689,728
24,728
20,474
1,603
2,318
332

1,121,688
276,890
225,521
51,370
10,049
2,130
23,008
5,639
652
9,891
119,701
725,097
699,585
25,512
20,750
2,200
2,229
333

1,113,730
271,034
222,326
48,708
8,652
1,795
21,980
5,163
615
10,502
117,197
725,499
699,430
26,070
21,364
2,206
2,159
341

1,099,404
263,571
215,697
47,874
9,093
1,879
21,115
5,191
749
9,847
116,916
718,918
692,816
26,101
21,399
2,211
2,152
339

1,102,585
269,154
218,244
50,910
8,925
2,162
22,006
5,591
631
11,596
116,411
717,021
690,682
26,339
21,539
2,270
2,191
339

282,295
707
11,625
269,963

278,080'
0
2,830
275,249'

282,550'
0
278,178'

292,849'
0
28,877
263,972'

287,695
0
22,358
265,337

280,649
0
16,196
264,453

287,083
0
12,268
274,815

288,744
0
14,392
274,353

292,143
0
12,777
279,366

112,144

103,572'

103,633'

101,848'

105,371

106,865

109,332

104,660

109,029

1,499,871' 1,512,252' l,490,053 r

1,494,630

1,509,202

1,510,146

1,492,808

1,503,757

1,497,130

1,312'

145,015

145,298'

146,488'

146,918'

146,173

146,512

147,236

147,289

146,831

1,338,668
103,994
869
447
422
23,225
-12,368

1,348,529'
108,547'
876
447
429
23,227
-13,190'

1,350,364'
108,300'
875
447
429
23,321
-16,201R

1,347,422'
109,310'
875
447
429
23,464
-12,016

1,345,002
107,956
872
443
428
23,333
-8,995

1,357,422
109,578
871
442
428
23,298
-11,242

1,355,028
109,150
867
438
428
23,479
-8,661

1,352,960
107,904
866
437
428
23,182
-13,626

1,346,336
107,577
864
437
426
23,051
-9,699

MEMO

71
72
73
74
75
76
77

Total loans and leases, gross, adjusted, plus securities 1
Time deposits in amounts of $100,000 or more
Loans sold outright to affiliates
Commercial and industrial
Other
Foreign branch credit extended to U.S. residents . . .
Net due to related institutions abroad

1. Includes ccrtificatcs of participation, issued or guaranteed by agendas of the
U.S. government, in pools of residential mortgages.
2. Includes securities purchased under agreements to resell.
3. Includes allocated transfer risk reserve.
4. Includes negotiable order of withdrawal accounts (NOWs), automatic transfer service (ATS), and telephone and preauthorized transfers of savings deposits.
5. Includes borrowings only from other than directly related institutions.
6. Includes federal funds purchased and securities sold under agreements to
repurchase.
7. This balancing item is not intended as a measure of equity capital for use in
capital-adcquacy analysis.
S. Excludes loans to and federal funds transactions with commercial banks in
the United States.

9. Affiliates includc a bank's own foreign branches, nonconsolidatcd nonbank
affiliates of the bank, the bank's holding company (if not a bank), and nonconsolidatcd nonbank subsidiaries of the holding company.
10. Credit extended by foreign branches of domestically chartered weekly
reporting banks to nonbank U.S. residents. Consists mainly of commercial and
industrial loans, but includes an unknown amount of credit extended to other than
nonfinancial businesses.
NOTE. Data that formerly appeared in table 1.28, Assets and Liabilities of Large
Weekly Reporting Commercial Banks in New York City, can be obtained from the
Board s H.4.2 (504) weekly statistical release. For ordering address, see inside
front covcr.

The Foreign List specifies those foreign equity
securities that are eligible for margin treatment at
broker-dealers. One security was deleted from the
Foreign List, which now contains 300 foreign
equity securities, and no additions were made.
The changes that have been made to the revised
OTC List, which now contains 3,388 OTC stocks,
are as follows:

• Thirty-two stocks have been removed for reasons such as listing on a national securities
exchange or involvement in an acquisition.

• One hundred ninety-one stocks have been
included for the first time, 150 under National
Market System (NMS) designation
• Thirty stocks previously on the list have been
removed for substantially failing to meet the
requirements for continued listing



The Board publishes the OTC List for the
information of lenders and the general public. It
includes all over-the-counter securities designated
by the Board pursuant to its established criteria
as well as all OTC stocks designated as NMS
securities for which transaction reports are required
to be made pursuant to an effective transaction
reporting plan. Additional OTC securities may be
designated as NMS securities in the interim
between the Board's quarterly publications and
will be immediately marginable. The next publica-

858

Federal Reserve Bulletin • September 1993

tion of the Board's list is scheduled for October 1993.
Besides NMS-designated securities, the Board
will continue to monitor the market activity of




other OTC stocks to determine which stocks meet
the requirements for inclusion and continued inclusion on the OTC List.
•

859

Minutes of the
Federal Open Market Committee Meeting
of May 18,1993
A meeting of the Federal Open Market Committee
was held in the offices of the Board of Governors
of the Federal Reserve System in Washington,
D.C., on Tuesday, May 18, 1993, at 9:00 a.m.
Present:
Mr. Greenspan, Chairman
Mr. Corrigan, Vice Chairman
Mr. Angell
Mr. Boehne
Mr. Keehn
Mr. Kelley
Mr. LaWare
Mr. Lindsey
Mr. McTeer
Mr. Mullins
Ms. Phillips
Mr. Stern
Messrs. Broaddus, Jordan, Forrestal, and Parry,
Alternate Members of the Federal Open
Market Committee
Messrs. Hoenig, Melzer, and Syron, Presidents
of the Federal Reserve Banks of Kansas City,
St. Louis, and Boston respectively
Mr. Bernard, Deputy Secretary
Mr. Coyne, Assistant Secretary
Mr. Gillum, Assistant Secretary
Mr. Mattingly, General Counsel
Mr. Prell, Economist
Messrs. R. Davis, Lang, Lindsey, Promisel,
Rolnick, Rosenblum, Scheld, Siegman,
and Slifman, Associate Economists
Mr. McDonough, Manager of the System Open
Market Account
Ms. Greene, Deputy Manager for Foreign
Operations
Ms. Lovett, Deputy Manager for Domestic
Operations
Mr. Ettin, Deputy Director, Division of Research
and Statistics, Board of Governors




Mr. Madigan, Associate Director, Division of
Monetary Affairs, Board of Governors
Mr. Stockton, Associate Director, Division of
Research and Statistics, Board of Governors
Mr. Hooper, Assistant Director, Division of
International Finance, Board of Governors
Mr. Small,1 Section Chief, Division of Monetary
Affairs, Board of Governors
Ms. Low, Open Market Secretariat Assistant,
Division of Monetary Affairs, Board of
Governors
Messrs. T. Davis, Dewald, and Goodfriend, Senior
Vice Presidents, Federal Reserve Banks of
Kansas City, St. Louis, and Richmond
respectively
Ms. Browne, Mr. Judd, and Mses. Rosenbaum
and White, Vice Presidents, Federal Reserve
Banks of Boston, San Francisco, Atlanta, and
New York respectively
Mr. Eberts, Assistant Vice President,
Federal Reserve Bank of Cleveland
By unanimous vote, the minutes for the meeting
of the Federal Open Market Committee held on
March 23, 1993, were approved.
The Deputy Manager for Foreign Operations
reported on developments in foreign exchange markets and on System transactions in foreign currencies during the period March 23, 1993, through
May 17, 1993. By unanimous vote, the Committee
ratified these transactions.
The M a n a g e r of the System Open M a r k e t
Account reported on developments in domestic

1. Attended portion of meeting relating to a report on a study
entitled "Operating Procedures and the Conduct of Monetary Policy: Conference Proceedings," edited by Marvin Goodfriend and
David Small. This two-volume study has been designated Working
Studies 1, Parts 1 and 2, of the Federal Reserve Board's Finance
and Economic Discussion Series.

860

Federal Reserve Bulletin • September 1993

financial markets and on System open market transactions in government securities and federal agency
obligations during the period March 23, 1993,
through May 17, 1993. By unanimous vote, the
Committee ratified these transactions.
The Committee then turned to a discussion of the
economic outlook and the implementation of monetary policy over the intermeeting period ahead. A
summary of the economic and financial information available at the time of the meeting and of the
Committee's discussion is provided below, followed by the domestic policy directive that was
approved by the Committee and issued to the Federal Reserve Bank of New York.
The information reviewed at this meeting suggested that the pace of the economic expansion had
slowed in recent months. Business outlays for durable equipment had remained strong, but consumer
spending had been quite sluggish, reflecting limited
gains in employment and real labor income and
diminished optimism about near-term economic
prospects. Additionally, U.S. exports continued to
be constrained by the disappointing performance of
the major foreign industrial economies. Available
data indicated relatively modest growth in payroll
employment and industrial production over recent
months. Despite the considerable slack in the economy, increases in wages and prices had been appreciably larger thus far in 1993 than in the second
half of last year.
Total nonfarm payroll employment rose only
slightly on balance over March and April after
registering sizable increases in the first two months
of the year. Strong job gains in the services industry, notably in business and health services, were
offset in considerable measure by job losses in
manufacturing and construction in March and
April. In manufacturing, reductions in payrolls
were widespread, with particularly large declines at
manufacturers of transportation equipment. Construction employment recovered only partially in
April from the weather-related decline in March.
The civilian unemployment rate remained at
7.0 percent.
Industrial production, after having posted solid
gains in previous months, was little changed in
March and April. Part of the recent sluggishness
reflected a decline in utility output following a
weather-related runup in February, but manufacturing output also grew more slowly. In the transporta-




tion industry, motor vehicle assemblies edged down
and production of civilian aircraft remained weak
over March and April. Elsewhere, the output of
consumer goods other than motor vehicles was
about unchanged, and the continuing strength in
the computer industry contrasted with sluggish production of other types of business equipment. Total
utilization of industrial capacity changed little over
the two months.
Retail sales increased substantially in April,
reversing the weather-related decline in March;
automotive dealers reported large sales gains in
April, and expenditures at other retail outlets
retraced part of the March decrease. For the year to
date, however, retail sales had been lackluster after
the strong increases of the latter part of 1992.
Housing starts picked up in April; both singlefamily and multifamily starts rebounded from
weather-depressed March levels.
Business fixed investment advanced further during the first quarter of 1993, with another sizable
rise in outlays for equipment outweighing continued weakness in nonresidential construction. Shipments of nondefense capital goods during the first
quarter were paced by another sharp increase in
shipments of office and computing equipment. By
contrast, business spending for transportation
equipment generally exhibited little strength;
although sales of heavy trucks continued to trend
up, outlays for complete aircraft apparently edged
down further. Recent data on orders for nondefense
capital goods other than aircraft suggested further
expansion in business spending for equipment in
the near term. Nonresidential construction activity
was mixed in the first quarter. Office construction
declined considerably further in response to the
depressing effects of a continuing overhang of
unoccupied space. On the other hand, building
activity in the public utilities sector continued to
trend up, and the construction of commercial structures other than office buildings increased for a
second consecutive quarter.
Business inventories appeared to have risen in
the first quarter. Manufacturing inventories
expanded in both February and March after a series
of declines that began early in the fall; much of the
recent advance occurred in the durable goods sector, where shipments were strong, and the ratio of
inventories to shipments fell for manufacturing as a
whole. Wholesale inventories increased apprecia-

Minutes of the Federal Open Market Committee Meeting

bly in March. However, the inventory-to-sales ratio
for the sector moved up only slightly, and it
remained near the low end of its range over the past
two years. In the retail sector, available data indicated that inventories rose appreciably over January and February but that the inventory-to-sales
ratio remained in the narrow range that had prevailed over the preceding year.
The nominal U.S. merchandise trade deficit in
February was unchanged from its January level,
reflecting little change in total exports and total
imports. For January-February combined, however,
the trade deficit was slightly below its average
level for the fourth quarter, with both exports and
imports down considerably from their fourthquarter levels. Much of the drop in exports reflected
a reversal of an earlier, largely transitory runup in
aircraft and automotive products. The decline in
imports was spread across all major trade categories; imports of aircraft and miscellaneous industrial supplies dropped appreciably, and imports of
consumer goods fell further. Recent indicators
pointed to further weakness in economic activity in
continental Europe and Japan through the first
quarter. Elsewhere, the recovery in the United
Kingdom appeared to be firming, and growth continued at a modest pace in Canada.
Producer prices of finished goods rose more rapidly in March and April, partly as a result of sharp
increases in the prices of finished energy goods in
March and in the prices of finished foods in April.
Excluding the food and energy components, producer prices advanced over the first four months of
1993 at a faster pace than in 1992. At the consumer
level, the increase in prices of nonfood, non-energy
items over the March-April period was smaller
than the outsized change over the first two months
of the year; nevertheless, averaging over the first
four months of the year, the rate of increase in
consumer prices was higher than in 1992. The
deceleration of labor costs also appeared to have
stalled in 1993. Average hourly earnings of production or nonsupervisory workers had grown more
rapidly thus far this year than in 1992, and total
hourly compensation of private industry workers
rose at a faster pace in the first quarter of 1993 than
in any quarter of last year.
At its meeting on March 23, the Committee
adopted a directive that called for maintaining the
existing degree of pressure on reserve positions and




861

that did not include a presumption about the likely
direction of any adjustments to policy during the
intermeeting period. Accordingly, the directive
indicated that in the context of the Committee's
long-run objectives for price stability and sustainable economic growth, and giving careful consideration to economic, financial, and monetary developments, slightly greater reserve restraint or
slightly lesser reserve restraint would be acceptable
during the intermeeting period. The reserve conditions associated with this directive were expected
to be consistent with a resumption of moderate
growth in M2 and M3 over the second quarter.
Open market operations during the intermeeting
period were directed toward maintaining the existing degree of pressure on reserve positions.
Expected levels of adjustment plus seasonal borrowing were raised during the period in anticipation of some increase in seasonal borrowing.
Adjustment plus seasonal borrowing was near or a
little above expected levels, except for a surge at
the end of the first quarter, and the federal funds
rate remained close to the 3 percent level that had
prevailed for an extended period.
Short-term interest rates changed little over the
period since the March meeting. Long-term rates
rose considerably early in the period when a sharp
increase in average hourly earnings and some
upward pressure on commodity prices sparked
fears among market participants of a buildup in
inflation pressures. Subsequently, despite growing
doubts about the fate of the deficit reduction program, bond yields declined in response to a series
of more favorable readings on price behavior and
to indications of a slowing of the economic expansion. Adverse news about consumer and producer
prices rekindled inflation concerns late in the
period, and bond rates once again moved higher.
On balance, most long-term market rates rose
somewhat over the period. Despite unexpectedly
favorable earnings reports for many firms, major
indexes of stock prices were narrowly mixed over
the period.
In foreign exchange markets, the trade-weighted
value of the dollar in terms of the other G-10
currencies declined somewhat on balance over the
intermeeting period. The dollar depreciated considerably more against the Japanese yen than against
the German mark. A variety of factors contributed
to the dollar's weakness, including indications of

862

Federal Reserve Bulletin • September 1993

renewed sluggishness in U.S. economic activity,
diminished prospects for a fiscal stimulus package,
and market perceptions over much of the intermeeting period of limited official support for concerted actions to support the dollar against the yen.
After falling to a historical low against the yen in
late April, the dollar tended to stabilize following
Treasury Secretary Bentsen's clarification of the
Administration's exchange rate policy and intervention purchases of dollars against yen in a coordinated operation. Later in the period, the dollar
rose somewhat against European currencies as the
outlook for economic activity in Europe became
more pessimistic.
M2 contracted slightly on balance over March
and April, while M3 was unchanged over the two
months; both monetary aggregates increased substantially in early May. Much of the weakness in
M2 over the March-April period owed to a smaller
volume of nonwithheld tax payments in April of
this year that reduced the need for a buildup in
deposits to fund these payments. Abstracting from
this temporary depressant, weak underlying growth
in M2 continued to reflect the relatively attractive
returns available on capital market instruments
such as bond and stock mutual funds, which experienced heavy inflows during the two-month
period. Total domestic nonfinancial debt expanded
somewhat further through March.
The staff projection prepared for this meeting
suggested that economic activity would grow at a
moderate pace and that such growth would foster a
gradual reduction in margins of unemployed labor
and capital. The projection continued to incorporate the essential elements of the Administration's
fiscal package, excluding that portion of the shortrun stimulus initiative that seemed unlikely to be
enacted by the Congress. Although the outlook for
fiscal policy now seemed somewhat more contractionary than earlier, the sizable declines in longterm interest rates that had occurred in recent
months were expected to support substantial additional gains in business and residential investment.
Moreover, the increasingly favorable financial
environment associated with expected further easing of credit supply constraints and the ongoing
strengthening of balance sheets would tend to buttress private spending on housing, consumer durables, and business equipment. Increases in export
demand would be damped in the near term by the




continuing weakness in the economies of the major
industrialized countries. The persisting slack in
resource utilization was expected to be associated
with a return to more subdued price increases after
a spurt earlier in the year.
In the Committee's discussion of current and
prospective economic conditions, the members
focused with some concern on the evidence of a
slower economic expansion and a higher rate of
inflation since late 1992. While recent indicators of
economic activity were disappointing, the expansion nonetheless appeared to have sustainable
momentum and the members generally viewed
moderate growth in line with, or perhaps a bit
below, their February forecasts as a reasonable
expectation. At the same time, several emphasized
that the outlook was subject to substantial uncertainty stemming to an important extent from the
unsettled course of legislation aimed at reducing
the federal deficit. Members expressed particular
concern about the rise in various measures of inflation over the past several months. The increase
seemed to reflect temporary factors and a worsening in inflationary expectations rather than any
significant change in economic fundamentals.
Accordingly, it was premature in the view of many
members to conclude that the inflationary trend
had tilted upward. Even so, higher inflation expectations, if sustained, would be detrimental to economic performance, and the risks of an uptrend in
inflation clearly had increased.
In their review of business developments across
the nation, members continued to report uneven
conditions ranging from apparently moderate gains
in some parts of the country to mixed or marginally
declining activity in others. Business confidence
had deteriorated in many areas and firms were
trimming or putting on hold new or expanded
spending programs pending a resolution of federal
tax and spending proposals, including prospective
health care reform, and the outcome of proposed
tax legislation in some states as well. Cautious
business attitudes were reflected in continuing
efforts to constrain costs and to hold down or
reduce employment levels, notably of permanent
workers in light of the large nonwage costs associated with full-time workers. Accordingly, while
some job growth was occurring, especially outside
major firms and the defense sector, business firms
generally appeared disposed to continue to meet

Minutes of the Federal Open Market Committee Meeting

increases in demand through overtime work and
temporary workers, and members anticipated that
such attitudes were likely to persist in the absence
of a major improvement in business confidence.
As reflected in the available data for the national
economy, anecdotal reports from around the country suggested generally lackluster retail sales over
the first four months of the year. To an extent, this
development probably involved some retrenchment
in consumer spending following an unsustainable
surge during the latter part of 1992. In some parts
of the country, unusually severe weather conditions
also had served to hold down retail sales earlier this
year, and recovery from that slowdown had tended
to be limited thus far, especially outside the automotive sector. Looking ahead, the members continued to anticipate that consumer spending would
provide moderate support for a sustained economic
expansion.
Despite the cautious business attitudes about the
economic outlook, spending for business equipment had continued to help maintain the expansion.
Encouraged in part by relatively low interest rates,
receptive financial markets, and the more aggressive lending policies of some depository institutions, many firms were upgrading equipment to
reduce costs and improve their product offerings.
Concurrently, however, numerous firms reported
that they were holding off on making major new
investment commitments and in some cases were
revising down earlier expansion plans in light of
prevailing economic uncertainties, notably those
generated by the current legislative debate about
federal taxes and spending. Nonresidential construction remained uneven and on the whole relatively subdued across the nation. The construction
of new office structures was likely to stay depressed
in much of the country as overcapacity continued
to be worked down, but members saw indications
of some strengthening in industrial and commercial
building activity and in public works projects in
some areas.
Turning to the outlook for the nation's trade
balance, some members referred to quite gloomy
assessments from business contacts and other
sources regarding current economic conditions in a
number of major industrial nations and the associated prospect of little or no growth in U.S. exports
to such countries. While total U.S. exports might
continue to expand, reflecting sizable gains in some




863

parts of the world, imports probably would grow at
a somewhat faster pace, given moderate expansion
in domestic demand in line with the members'
expectations. At the same time, members expressed
concern about the potential impact of growing protectionist sentiment on current trade negotiations
and on the longer-run outlook for domestic industries and parts of the country that relied on foreign
trade.
With regard to the inflation situation, members
commented that it remained difficult to find a satisfactory explanation for the faster-than-projected
increases in price measures thus far this year.
Although temporary anomalies seemed to be
involved, including measurement problems and
special factors boosting some prices, higher inflation expectations also might have been playing a
key role. The latter seemed to have intensified in
the last month or two, perhaps as a result of growing concerns that significant deficit-reduction legislation might not be enacted. Strong competitive
pressures in many markets, including competition
from foreign producers, still appeared to be
restraining or precluding price increases by many
business firms, but efforts to raise prices seemed to
be encountering somewhat less resistance recently
than earlier in the economic expansion. Some price
increases appeared to be associated with the earlier
surge in demand, and in the case of one key industry higher prices had been facilitated by the implementation of import restrictions. The downtrend in
labor compensation inflation also seemed to have
stalled in recent months. Against this background,
a considerable degree of uncertainty surrounded
the outlook for inflation and the members differed
to some extent with regard to the most likely outcome. A number of members, while they did not
rule out the possibility of a more favorable result,
stressed the risk that a faster rate of inflation might
well tend to be sustained. Others gave more emphasis to the still considerable slack in labor and
product markets and to the restrained growth in
broad measures of money and credit. In this view,
an inflation rate in the quarters ahead more in line
with their earlier forecasts was still a reasonable
expectation even though the average rate for the
year as a whole was likely to be higher than they
had forecast at the start of the year.
In the Committee's discussion of policy for the
intermeeting period ahead, many of the members

864

Federal Reserve Bulletin • September 1993

commented that recent price and wage developments were troubling but did not point persuasively
at this juncture toward an extended period of higher
inflation. In light of underlying economic and
financial conditions, the upturn in inflation expectations and the somewhat quickened pace of inflation
might well prove to be temporary. The economy
was expanding, but the pace had slowed in recent
months. On the other hand, the potential for a
sustained increase in the rate of inflation could not
be dismissed. Waiting too long to counter any
emerging uptrend in inflation or further worsening
in inflationary expectations would exacerbate inflationary pressures and require more substantial and
more disruptive policy moves later. Indeed, in one
view sensitive commodity prices and other key
measures of inflation already indicated the need for
a prompt move toward restraint, especially in the
context of the Committee's objective of fostering
progress toward price stability. However, the other
members all supported a proposal to maintain an
unchanged degree of pressure on reserve positions
at this time.
In the course of the Committee's discussion, the
members took account of a staff analysis that
pointed to a considerable pickup in the growth of
M2 and M3 over the months of May and June.
Such strengthening, which appeared to have
emerged in early May, was associated in part with
the reversal of earlier tax-related distortions and
with a surge in prepayments of mortgage-backed
securities. Monetary growth was expected to revert
to a more modest pace over subsequent months,
and the members recognized that in any event the
interpretion of monetary growth rates needed to be
approached with considerable caution in a period
when traditional relationships of such growth to
aggregate measures of economic performance were
not reliable. In present circumstances, M2 and M3
no longer seemed to be good barometers of underlying liquidity, which appeared to be ample. One
member expressed the view that the relatively
robust growth of M l and reserves served as a better
indicator of the thrust of monetary policy than did
the broader monetary aggregates.
In the view of a majority of the members, wage
and price developments over recent months were
sufficiently worrisome to warrant positioning policy for a move toward restraint should signs of
intensifying inflation continue to multiply. In addi-




tion to new information on prices and costs, such
signs could include developments in markets
affected by inflation psychology, such as those for
bonds, foreign exchange, and sensitive commodities, all of which would need to be monitored
carefully. These members supported a directive
that incorporated a greater predilection to tighten
than to ease over the intermeeting period. Given
the special nature of current inflation concerns and
attendant uncertainties, however, the Committee
agreed with a proposal by the Chairman that an
intermeeting consultation would be appropriate in
the event that a tightening move were to be contemplated during this period. If a policy tightening
action were not needed, an asymmetric directive
would nonetheless underscore the Committee's
concern about recent inflation readings and its
judgment that a policy to encourage progress
toward price stability would promote sustained
economic growth. In the event that a tightening
action became necessary, such action could help to
moderate inflationary expectations, with positive
implications over time for long-term interest rates
and the performance of the economy. Monetary
policy would still be stimulative after a modest
tightening move in that such a move would leave
short-term interest rates close to or even below
their year-ago levels in real terms, given the interim
rise in inflation.
Some members preferred to retain a directive
that did not incorporate a presumption about the
likely direction of a change in policy, if any, during
the intermeeting period. They were concerned that
adopting a biased directive might prove to be an
overreaction to temporary factors and to a shortlived upturn in inflationary sentiment that was not
warranted by underlying economic conditions.
They noted that, if called for by intermeeting developments, a move toward restraint could be implemented from a symmetric directive. More fundamentally, they believed that the circumstances
surrounding the recent performance of the economy and the uncertainties about price developments suggested the need for considerable caution
before any policy tightening was implemented and
that such a policy move should be carried out only
in the light of information that pointed clearly to
the emergence of higher inflation. Nonetheless, all
but one of these members could accept an asymmetric directive on the understanding that the Com-

Minutes of the Federal Open Market Committee Meeting

mittee would have a chance to discuss any possible
policy action.
At the conclusion of the Committee's discussion,
all but two of the members indicated that they
preferred or could accept a directive that called for
maintaining the existing degree of pressure on
reserve positions and that included a bias toward
possible firming of reserve conditions during the
intermeeting period. Accordingly, in the context of
the Committee's long-run objectives for price stability and sustainable economic growth, and giving
careful consideration to economic, financial, and
monetary developments, the Committee decided
that slightly greater reserve restraint would be
acceptable or slightly lesser reserve restraint might
be acceptable during the intermeeting period. The
reserve conditions contemplated at this meeting
were expected to be consistent with appreciable
growth in the broader monetary aggregates over the
second quarter.
At the conclusion of the meeting, the Federal
Reserve Bank of New York was authorized and
directed, until instructed otherwise by the Committee, to execute transactions in the System account
in accordance with the following domestic policy
directive:
The information reviewed at this meeting suggests
that the economic expansion has slowed in recent
months. Total nonfarm payroll employment rose only
slightly over March and April after registering sizable
increases earlier in the year, and the civilian unemployment rate remained at 7.0 percent. Industrial production
was little changed in March and April after posting solid
gains in previous months. Retail sales increased substantially in April but were about unchanged on balance for
the year to date. Housing starts picked up in April.
Incoming data on orders and shipments of nondefense
capital goods suggest a further brisk advance in outlays
for business equipment, while nonresidential construction has remained soft. The nominal U.S. merchandise
trade deficit in January-February was slightly below its
average level in the fourth quarter. Increases in wages
and prices have been appreciably larger this year than in
the second half of 1992.
Short-term interest rates have changed little since the
Committee meeting on March 23 while bond yields have
risen somewhat. In foreign exchange markets, the tradeweighted value of the dollar in terms of the other G-10
currencies declined somewhat on balance over the intermeeting period.
After contracting during the first quarter, M2 was
unchanged in April while M3 turned up; both aggregates
increased substantially in early May. Total domestic




865

nonfinancial debt expanded somewhat further through
March.
The Federal Open Market Committee seeks monetary
and financial conditions that will foster price stability
and promote sustainable growth in output. In furtherance
of these objectives, the Committee at its meeting in
February established ranges for growth of M2 and M3 of
2 to 6 percent and xh to 4'/2 percent respectively, measured from the fourth quarter of 1992 to the fourth
quarter of 1993. The Committee expects that developments contributing to unusual velocity increases are
likely to persist during the year. The monitoring range
for growth of total domestic nonfinancial debt was set at
4'/2 to 8Y2 percent for the year. The behavior of the
monetary aggregates will continue to be evaluated in the
light of progress toward price level stability, movements
in their velocities, and developments in the economy and
financial markets.
In the implementation of policy for the immediate
future, the Committee seeks to maintain the existing
degree of pressure on reserve positions. In the context of
the Committee's long-run objectives for price stability
and sustainable economic growth, and giving careful
consideration to economic, financial, and monetary
developments, slightly greater reserve restraint would or
slightly lesser reserve restraint might be acceptable in
the intermeeting period. The contemplated reserve conditions are expected to be consistent with appreciable
growth in the broader monetary aggregates over the
second quarter.
Votes for this action: Messrs. Greenspan, Corrigan,
Keehn, Kelley, LaWare, Lindsey, McTeer, Mullins,
Ms. Phillips, and Mr. Stern. Votes against this action:
Messrs. Angell and Boehne.
Mr. Angell dissented because he believed that
the persisting indications of rising inflation and the
related deterioration in inflationary psychology
called for a prompt move to tighten monetary policy. In his view, low real interest rates, a very steep
yield curve, a surprisingly weak exchange value of
the dollar along with the confirming price behavior
of inflation-sensitive commodities such as gold
underscored the need for Committee action to signal the System's continuing commitment to the
eventual achievement of price stability. In his opinion, progress toward lower inflation was not likely
in 1993 and 1994 in the absence of a monetary
policy that was sufficiently restrictive to check
inflationary expectations. He added that history
demonstrated that a monetary policy focused primarily on developments in the real economy ran
the risk of waiting too long to counter a worsening
in inflationary expectations and thus requiring more

866

Federal Reserve Bulletin • September 1993

substantial and possibly more disruptive policy
changes later.
Mr. Boehne supported a steady policy course,
but he dissented because he objected to a directive
that was biased toward tightening. Although recent
developments suggested that inflation would be
somewhat higher and real growth somewhat lower
during the year than had been expected earlier, he
did not believe recent data indicated a fundamental
shift in the outlook for inflation or the economy. He
was concerned that adopting a biased directive
might prove to be an overreaction to temporary
factors affecting the inflation rate and inflationary
sentiment. In his view, underlying economic conditions did not point toward an extended period of
higher inflation. While the pace of economic
growth conceivably could quicken, it seemed just




as likely that the tempo of business and consumer
spending could diminish in the face of uncertainty
about the stance of fiscal policy, particularly with
regard to potential tax increases. Given these uncertainties, he had a strong preference for keeping an
open mind about possible Committee action during
the intermeeting period and, accordingly, favored a
balanced policy directive.
It was agreed that the next meeting of the Committee would be held on Tuesday-Wednesday,
July 6-7, 1993.
The meeting adjourned at 1:50 p.m.

Normand Bernard
Deputy Secretary

867

Legal Developments
FINAL RULE—AMENDMENTS
G, T, U AND X

TO REGULATIONS

The Board of Governors is amending 12 C.F.R. Parts
207, 220, 221 and 224, its Regulations G, T, U and X
(Securities Credit Transactions; List of Marginable
OTC Stocks; List of Foreign Margin Stocks). The List
of Marginable OTC Stocks (OTC List) is composed of
stocks traded over-the-counter (OTC) in the United
States that have been determined by the Board of
Governors of the Federal Reserve System to be subject to the margin requirements under certain Federal
Reserve regulations. The List of Foreign Margin
Stocks (Foreign List) is composed of foreign equity
securities that have met the Board's eligibility criteria
under Regulation T. The OTC List and the Foreign
List are published four times a year by the Board. This
document sets forth additions to or deletions from the
previous Foreign List. Both Lists were published on
April 27, 1993 and effective on May 10, 1993.
Effective August 9, 1993, accordingly, pursuant to
the authority of sections 7 and 23 of the Securities
Exchange Act of 1934, as amended (15 U.S.C. 78g and
78w), and in accordance with 12 C.F.R. 207.2(k) and
207.6 (Regulation G), 12 C.F.R. 220.2(u) and 220.17
(Regulation T), and 12 C.F.R. 221.20) and 221.7 (Regulation U), there is set forth below a listing of deletions
from and additions to the OTC List, and one deletion
from the Foreign List.

Deletions from the List of Marginable OTC
Stocks
Stocks Removed for Failing Continued Listing
Requirements

Cardinal Distribution, Inc.: 1-Va% convertible subordinated debentures
Community Financial Corp.: $.01 par common
Erly Industries, Inc.: $1.00 par common
F & C International, Inc.: No par common
Fonic Inc.: Warrants (expire 05-20-93)
GHA Group, Inc.: Class B, $.01 par common
Great American Communications Company: $.01 par
common
Horizon Resources Corporation: $.01 par common
In-Store Advertising, Inc.: $.01 par common
Independent BankGroup, Inc.: $1.00 par common
Intellicorp, Inc.: $.001 par common
Kentucky Central Life Insurance Company: Class A,
non-voting, $1.00 par common
Masstor Systems Corporation: $.001 par common
Metallurgical Industries, Inc.: Class A, $.10 par common
National Medical Waste, Inc.: $.01 par common
Nationwide Cellular Service, Inc.: Warrants (expire
06-01-93)
Norsk Data A.S.: American Depositary Receipts for
Class B, non-voting shares
Optek Technology, Inc.: $.01 par common

American Integrity Corporation: $.01 par common
American Rice, Inc.: $1.00 par common

Scios Nova Inc.: Class C, Warrants (expire 06-30-93)

Aspen Imaging International, Inc.: No par common

Spectrum Information Technologies, Inc.: Class A,
Warrants (expire 06-11-93)
Sungard Data Systems Inc.: 8-!/4% convertible subordinated debentures

Auto-Trol Technology: $.01 par common
Bioplasty, Inc.: $.01 par common
Blue Ridge Real Estate Company/Big Boulder
Corporation: Paired certificates

TSL Holdings, Inc.: $.01 par common

Boston Digital Corporation: $.10 par common

Vest, H.D., Inc.: Warrants (expire 05-21-93)




868

Federal Reserve Bulletin • September 1993

Stocks Removed for Listing on a National
Securities Exchange or Being Involved in an
Acquisition

Additions to the List of Marginable OTC
Stocks
3DO Company, The: $.01 par common

Bank of East Tennessee: $2.00 par common
Brand Companies, Inc., The: $.10 par common
Cardinal Financial Group, Inc.: $.10 par common
CB&T Financial Corporation: $1.00 par common
CFS Financial Corporation: $1.00 par common
Colorado National Bankshares, Inc.: No par common
Financial Federal Corporation: $.50 par common
First Community Bancorp Inc.: $1.00 par common
Goldtex, Inc.: $.10 par common
Grancare Inc.: No par common
Gull Laboratories, Inc.: $.001 par common
Hall-Mark Electronics Corporation: $.01 par common
Home Federal Savings Bank (Colorado): $1.00 par
common
Horizon Financial Services, Inc.: $1.00 par common
Jimbo's Jumbos, Incorporation: $.001 par common
Key Centurion Bancshares, Inc.: $3.00 par common
Manitowoc Company, Inc.: $.01 par common
Midsouth Corporation: $.20 par common
Multibank Financial Corporation: $6.25 par common
Northeast Bancorp, Inc.: $5.00 par common
Nucorp, Inc.: $.05 par common
Pulitzer Publishing Company: $.01 par common
Qual-Med, Inc.: $.01 par common
Ranch Industries, Inc.: $1.00 par common
Regency Cruises Inc.: $.001 par common
Republic Capital Group, Inc.: $.10 par common
Security Tag Systems, Inc.: $.001 par common
Society for Savings Bancorp, Inc.: $1.00 par common
Southern California Water Company: $5.00 par common
Southwestern Electric Service Co.: $1.00 par common
Sundowner Offshore Services, Inc.: $.01 par common
Western Financial Corporation: $1.00 par common



Abraxas Petroleum Corporation: $.01 par common
Absolute Entertainment, Inc.: No par common
ABT Building Products Corporation: $.01 par common
ACS Enterprises, Inc.: $.05 par common
Action Performance Companies, Inc.: $.01 par common; Warrants (expire 04-27-98)
AER Energy Resources, Inc.: No par common
AGCO Corporation: Depositary Shares
Alcide Corporation: $.01 par common
Aldila, Inc.: $.01 par common
Alpha 1 Biomedicals, Inc.: Warrants (expire 02-28-97)
American National Petroleum Company: $.01 par
common
American Safety Razor Company: $.01 par common
American Savings Bank of Florida: $.01 par common
Amerihost Properties, Inc.: $.005 par common
Amtran, Inc.: No par common
Auspex Systems, Inc.: $.001 par common
Bancfirst Ohio Corp.: $10.00 par common
Banco de Galicia y Buenos Aires S.A.: American
Depositary Shares
Bankunited Financial Corporation (Florida): Series
1993, $.01 par non-cumulative convertible preferred
Barrett Business Services, Inc.: $.01 par common
Base Ten Systems, Inc.: Class B, $1.00 par common
Bell Microproducts Inc.: $.01 par common
Black Hawk Gaming & Development Co., Inc.: $.001
par common; Class A, Warrants (expire 12-31-94);
Class B, Warrants (expire 06-30-96)
Blyth Holdings, Inc.: $.01 par common
Broadband Technologies, Inc.: $.01 par common
California Culinary Academy, Inc.: No par common
Cambridge Technology Partners (Massachusetts),
Inc.: $.01 par common
Care Enterprises, Inc.: $.01 par common
Catalyst Semiconductor, Inc.: No par common
CDW Computer Centers, Inc.: $.01 par common
Celestial Seasonings, Inc.: $.01 par common
Charter Bancshares, Inc. (Texas): $1.00 par common
Chattahoochee Bancorp, Inc. (Georgia): $1.00 par
common
Citizens Bancshares, Inc. (Ohio): No par common
Citizens Federal Bank, A Federal Savings Bank
(Florida): 8-3/t Series A, non-cumulative preferred
Clayton Williams Energy, Inc.: $.10 par common
Coastal Financial Corporation (South Carolina): $.01
par common
Commercial Bank of New York: $5.00 par common

Legal Developments

Communication Intelligence Corporation: $.01 par
common
Concurrent Computer Corporation: $.01 par common
CPI Aerostructures, Inc.: $.001 par common;
Warrants (expire 09-16-95)
CTL Credit, Inc.: $.01 par common
Cypros Pharmaceutical Corporation: No par common
Cyrk, Inc.: $.01 par common
D.I.Y. Home Warehouse, Inc.: No par common
Daig Corporation: $.01 par common
Delta and Pine Land Company: $.10 par common
Discovery Zone, Inc.: $.01 par common
Donnkenny, Inc.: $.01 par common
Dovatron International, Inc.: $.01 par common
Drug Emporium, Inc.: 7.75% convertible debentures
(due 2014)
Eagle Holdings, Inc.: No par common
ECCS, Inc.: $.01 par common
Edunetics Ltd.: Ordinary Shares, NIS .06 par value
Electroglas, Inc.: $.01 par common
Electronic Retailing Systems International, Inc.: $.01
par common
Equinox Systems, Inc.: $.01 par common
Erox Corporation: No par common
Evergreen Media Corporation: Class A, No par common
Excalibur Holding Corporation: $.00001 par common
F & M Bancorporation, Inc. (Wisconsin): $.01 par
common
Far East National Bank (California): $1.25 par common
FFBS Bancorp, Inc. (Mississippi): $.01 par common
FFY Financial Corp. (Ohio): $.01 par common
Fidelity New York F.S.B.: $.01 par common
Flir Systems, Inc.: $.01 par common
Fourth Shift Corporation: $.01 par common
Frozen Food Express Industries, Inc.: $1.50 par common
Future Healthcare, Inc.: No par common
GAB Bancorp (Indiana): $10.00 par common
General Communication, Inc.: Class A, No par
common
Genzyme Transgenics Corporation: $.01 par common
George Mason Bankshares, Inc. (Virginia): $1.66 par
common
Geotek Industries: $.01 par common
Gold Reserve Corporation: No par common
Gotham Apparel Corporation: $.001 par common
Ground Round Restaurants, Inc.: $.1667 par common
Growth Financial Corp. (New Jersey); $1.00 par common



869

Hallmark Healthcare Corporation: Class A, $.01 par
common
Hamilton Financial Services Corporation: $.01 par
common
Harmony Holdings, Inc.: $.01 par common
Harry's Farmers Market, Inc.: Class A, $.01 par
common
Healthdyne Technologies, Inc.: $.01 par common
HEI Inc.: $.05 par common
Hollywood Casino Corporation: $.01 par common
Horizon Bancorp, Inc. (West Virginia): $1.00 par
common
Huntco Inc.: Class A, $.01 par common
Hyde Athletic Industries, Inc.: Class B, $.33-1/3 par
common
Image Business Systems Corporation: $.01 par common
Independence Bancorp, Inc. (New Jersey): $1,667 par
common
Industrial Scientific Corporation: $.10 par common
Information Resource Engineering, Inc.: $.01 par
common
Interlinq Software Corporation: $.01 par common
International Imaging Materials, Inc.: $.01 par common
International Tourist Entertainment Corp.: $.001 par
common
IRG Technologies, Inc.: $.01 par common
IVF America, Inc.: $.01 par common; Series A, $1.00
par cumulative convertible preferred
Jabil Circuit, Inc.: $.01 par common
Jackson County Federal Bank, A Federal Savings
Bank (Oregon): $1.00 par common
Kent Financial Services, Inc.: $.10 par common
Laser Vision Centers, Inc.: $.01 par common
Laurel Savings Association (Pennsylvania): $1.00 par
common
LCI International, Inc.: $.01 par common
LF Bancorp, Inc. (Mississippi): $.01 par common
Lottery Enterprises, Inc.: $.01 par common
Lunn Industries, Inc.: $.01 par common
Magnetic Technologies Corporation: $. 15 par common
Mariner Health Group, Inc.: $.01 par common
Martin Color-Fi, Inc.: No par common
MBLA Financial Corporation (Missouri): $.01 par
common
Medical Care America, Inc.: 7% convertible debentures (due 2015)
Megahertz Corporation: $.004 par common
Megatest Corporation: $.001 par common

870

Federal Reserve Bulletin • September 1993

Metatec Corporation: Class A, $.01 par common
Metro Financial Corporation (Georgia): $1.00 par
common
MFS Communications Company, Inc.: $.01 par common
Microcarb Inc.: $.01 par common
Mississippi Valley Bancshares, Inc. (Missouri): $1.00
par common
National Convenience Stores, Inc.: Warrants (expire
03-09-98)
National Home Centers, Inc.: $.01 par common
Northern Springs Co., Inc.: Class A, $.01 par common
Northstar Health Services, Inc.: $.01 par common
Northwestern Steel and Wire Company: $.01 par
common
Norwood Promotional Products, Inc.: No par common
O'Reilly Automotive, Inc.: $.01 par common
Old America Stores, Inc.: $.01 par common
OPTI, Inc.: No par common
Pacific International Services Corporation: No par
common
Papa John's International, Inc.: $.01 par common
Paul Harris Stores, Inc.: $.01 par common
People's Bank (Connecticut): 8.5% Series A, No par
convertible preferred
People's Choice TV Corp.: $.01 par common
Petroleum Geo-Services A/S: American Depositary
Receipts
Phycor, Inc.: 6.5% convertible subordinated debentures (due 2003)
Pinnacle Micro, Inc.: $.001 par common
Pittencrieif Communications, Inc.: $.01 par common
Primadonna Resorts, Inc.: $.01 par common
Projectavision, Inc.: $.0001 par common
Quad Systems Corporation: $.03 par common
Quality Projects, Inc.: $.00001 par common
Random Access, Inc.: $.0001 par common
Re Capital Corporation: $.10 par common
Regal Cinemas, Inc.: No par common
Regional Acceptance Corporation: No par common
Reliable Life Insurance Company, The: Class A, $1.00
par common
Reno Air, Inc.: $.01 par common
Resource Mortgage Group, Inc. (South Carolina): $.01
par common
Rexall Sundown, Inc.: $.01 par common
Rhodes, Inc.: $.01 par common
Robert Mondavi Corporation, The: Class A, No par
common



Rochester Community Savings Bank, The: Series B,
$1.00 par non-cumulative convertible preferred
Safety 1st, Inc.: $.01 par common
Sanmina Corp.: $.01 par common
Santa Cruz Operation, Inc., The: No par common
Satcon Technology Corporation: $.01 par common
Seaman Furniture Company, Inc.: $.01 par common
Shiloh Industries, Inc.: $.01 par common
Signal Technology Corporation: $.01 par common
Silver King Communications, Inc.: $.01 par common
Sodak Gaming, Inc.: $.01 par common
Spectrum Signal Processing Inc.: No par common
St. Francis Capital Corporation: $.01 par common
Stanley Furniture Company, Inc.: $.02 par common
State Financial Services Corporation: Class A, $.10
par common
Station Casinos, Inc.: $.01 par common
Stolt Comex Seaway S.A.: $2.00 par common
Summit Bancshares, Inc. (Texas): $2.50 par common
Suncoast Savings & Loan Assoc. FSA: Series A,
$5.00 par non-cumulative convertible preferred
Sundance Homes, Inc.: $.01 par common
Sunglass Hut International, Inc.: $.01 par common
Supreme International Corporation: $.01 par common
Swisher International, Inc.: $.01 par common; Warrants (expire 04-21-96)
T R Financial Corp.: $.01 par common
Telor Ophthalmic Pharmaceuticals, Inc.: $.001 par
common
Therapeutic Discovery Corporation/ALZA Corporation: Units (expire 12-31-99)
Titan Holdings, Inc.: $.01 par common
Tital Wheel International, Inc.: No par common
Touchstone Applied Science Associates, Inc.: $.0001
par common
Trico Bancshares (California): No par common
United Mobile Homes, Inc.: $.10 par common
Valley Bancorp, Inc. (Pennsylvania): $5.00 par common
West Coast Bancorp, Inc. (Florida): $1.00 par common
Wind River Systems, Inc.: $.01 par common
Zaring Homes, Inc.: No par common

Deletion from the List of Foreign Margin
Stocks
Joshin Denki Company, Ltd.: ¥ 50 par common

Legal Developments

FINAL RULE—AMENDENT

TO REGULATION

Z

The Board of Governors is amending 12 C.F.R. Part
226, its Regulation Z (Truth in Lending), to provide a
temporary exception to Regulation Z provisions that
prohibit the use of a preprinted form by a creditor to
obtain a consumer's waiver of the right to rescind
certain home-secured loans when loan proceeds are
needed immediately to meet a consumer's bona fide
personal financial emergency. Generally, Regulation Z
requires a mandatory three-day waiting period on
rescindable transactions before funds can be disbursed. In addition, a consumer's need to obtain funds
immediately shall be regarded as a bona fide personal
financial emergency for purposes of Regulation Z for
transactions secured by consumers' principal dwellings located in areas of the Midwest recently declared
to be major disaster areas because of extensive flooding. The exception expires one year from the date the
area was declared a major disaster.
Effective July 29, 1993, 12 C.F.R. Part 226 is
amended as follows (the Board is publishing only those
sections of the regulation that are affected by the
changes):

Part 226—Truth in Lending
1. The authority citation for Part 226 continues to read:
Authority: Truth in Lending Act, 15 U.S.C. 1604 and
1637(c)(5); sec. 1204 (c), Competitive Equality Banking Act, 12 U.S.C. 3806.

Subpart B—Open-End Credit

2. Section 226.15 paragraph (e) is revised to read as
follows:

Section 226.15—Right of Rescission.

(e) Consumer's waiver of right to rescind.
(1) The consumer may modify or waive the right to
rescind if the consumer determines that the extension of credit is needed to meet a bona fide personal
financial emergency. To modify or waive the right,
the consumer shall give the creditor a dated written
statement that describes the emergency, specifically
modifies or waives the right to rescind, and bears the
signature of all the consumers entitled to rescind.
Printed forms for this purpose are prohibited, except
as provided in paragraph (2) of this section.



871

(2) The need of the consumer to obtain funds immediately shall be regarded as a bona fide personal
financial emergency provided that the dwelling securing the extension of credit is located in an area
declared during June through September 1993, pursuant to 42 U.S.C. 5170, to be a major disaster area
because of severe storms and flooding in the
Midwest. 363 In this instance, creditors may use
printed forms for the consumer to waive the right to
rescind. This exemption to paragraph (e)(1) of this
section shall expire one year from the date an area
was declared a major disaster.
3. Section 226.16 is amended by redesignating existing
footnotes 36a and 36b as footnotes 36b and 36c,
respectively.

Subpart C—Closed-End

Credit

4. Section 226.23 paragraph (e) is revised to read as
follows:

Section 226.23—Right of Rescission.

(e) Consumer's waiver of right to rescind.
(1) The consumer may modify or waive the right to
rescind if the consumer determines that the extension of credit is needed to meet a bona fide personal
financial emergency. To modify or waive the right,
the consumer shall give the creditor a dated written
statement that describes the emergency, specifically
modifies or waives the right to rescind, and bears the
signature of all the consumers entitled to rescind.
Printed forms for this purpose are prohibited, except
as provided in paragraph (2) of this section.
(2) The need of the consumer to obtain funds immediately shall be regarded as a bona fide personal
financial emergency provided that the dwelling securing the extension of credit is located in an area
declared during June through September 1993, pursuant to 42 U.S.C. 5170, to be a major disaster area
because of severe storms and flooding in the
Midwest. 483 In this instance, creditors may use
printed forms for the consumer to waive the right to
rescind. This exemption to paragraph (e)(1) of this
section shall expire one year from the date an area
was declared a major disaster.

36a. A list of the affected areas will be maintained by the Board.
Such areas now include parts of Iowa, Illinois, Minnesota, Missouri,
Nebraska, South Dakota, and Wisconsin.
48a. A list of the affected areas will be maintained by the Board.
Such areas now include parts of Illinois, Iowa, Minnesota, Missouri,
Nebraska, South Dakota, and Wisconsin.

872

Federal R e s e r v e Bulletin • September 1993

ORDERS ISSUED UNDER BANK
COMPANY ACT

HOLDING

Orders Issued Under Section 3 of the Bank
Holding Company Act

$73.3 million in total assets, is the 52d largest commercial banking organization in Colorado, controlling
$65.9 million in deposits, representing less than 1 percent of total deposits in commercial banks in the state. 3
Competitive

Banc One Corporation
Columbus, Ohio
Banc One Colorado Corporation
Denver, Colorado
Order Approving Merger of Bank Holding
Companies and Acquisition of Bank
Banc One Corporation, Columbus, Ohio ("Banc
One"), and its wholly owned subsidiary, Banc One
Colorado Corporation, Denver, Colorado ("Banc One
Colorado", and, together with Banc One, "Applicants"), bank holding companies within the meaning
of the Bank Holding Company Act ("BHC Act"),
have applied for the Board's approval under section 3
of the BHC Act (12 U.S.C. § 1842) to acquire Colorado Western Bancorp, Inc., Montrose, Colorado
("Colorado Western"), and thereby indirectly acquire
Colorado Western's sole subsidiary, The First National Bank of Montrose, Montrose, Colorado ("Montrose Bank"). 1
Notice of the applications, affording interested persons an opportunity to submit comments, has been
published (58 Federal Register 26,785 (1993)). The
time for filing comments has expired, and the Board
has considered the applications and all comments
received in light of the factors set forth in section 3(c)
of the BHC Act.
Banc One, with $73.7 billion in total consolidated
assets, is the eighth largest commercial banking organization in the United States, controlling $59.6 billion in
deposits. 2 Banc One operates 78 subsidiary banks in
Ohio, Indiana, Michigan, Wisconsin, Illinois, Texas,
Colorado, Kentucky, Arizona, California, Utah, and
West Virginia. Banc One Colorado, with $2.8 billion in
total assets, is the fourth largest commercial banking
organization in Colorado, controlling six bank subsidiaries with $2.4 billion in total deposits, representing
approximately 8.8 percent of total deposits in commercial banks in the state. Colorado Western, with

1. The transaction is structured as a merger of Colorado Western
with and into Banc One Colorado. Applicants also intend to merge
Montrose Bank with and into Bank One, Western Colorado, N.A.,
Salida, Colorado ("Bank One Western"). This bank merger has been
approved by the Office of the Comptroller of the Currency ("OCC")
pursuant to the Bank Merger Act (12 U.S.C. § 1828(c)).
2. Asset and deposit data are as of March 31, 1993, and reflect
acquisitions consummated since that date.




Considerations

Banc One and Colorado Western compete in the
Montrose County, Colorado, banking market ("Montrose banking market"). 4 Bank One Western is the
sixth largest depository institution5 in this market,
controlling deposits of $18.1 million, representing approximately 5.3 percent of total deposits in depository
institutions in the market ("market deposits"). 6 Montrose Bank is the second largest depository institution
in the market, controlling deposits of $61.4 million,
representing approximately 18.1 percent of market
deposits. Upon consummation of this proposal, Banc
One would become the second largest banking organization in the Montrose banking market, controlling
deposits of $79.5 million, representing approximately
23.4 percent of market deposits. The HerfindahlHirschman Index ("HHI") for the market would increase by 192 points to 2221. 7

3. Section 3(d) of the BHC Act, the Douglas Amendment, prohibits
the Board from approving an application by a bank holding company
to acquire control of any bank located outside the bank holding
company's home state, unless such acquisition is "specifically authorized by the statute laws of the State in which such bank is located, by
language to that effect and not merely by implication."
12 U.S.C. § 1842(d). Colorado's interstate banking statute permits
out-of-state bank holding companies nationwide to acquire banking
organizations located in Colorado, subject to specified statutory
requirements and a certification by state banking officials that the
acquisition satisfies such requirements. See Colo. Rev. Stat. § 116.4-103 (1992). The record in this case indicates that Banc One's
proposal satisfies all relevant statutory criteria, and the Colorado
banking authorities have issued a certification confirming this fact. For
these reasons, the Board has concluded that Banc One is authorized
under the laws of Colorado to acquire Colorado Western and Montrose Bank. Accordingly, Board approval of this proposal is not
prohibited by the Douglas Amendment.
4. The Montrose banking market is approximated by Montrose
County, Ouray County, and San Miguel County, all in Colorado.
5. In this context, depository institutions include commercial banks,
savings banks and savings associations. Market share data are based
on calculations in which the deposits of thrift institutions are included
at 50 percent. The Board previously has indicated that thrift institutions have become, or have the potential to become, major competitors of commercial banks. See WM Bancorp, 76 Federal Reserve
Bulletin 788 (1990); National City Corporation, 70 Federal Reserve
Bulletin 743 (1984).
6. Market share data are as of June 30, 1992.
7. Under the revised Department of Justice Merger Guidelines, 49
Federal Register 26,823 (1984), a market in which the post-merger
HHI is above 1800 is considered to be highly concentrated. In such
markets, the Justice Department is likely to challenge a merger that
increases the HHI by more than 50 points. The Justice Department
has informed the Board that, as a general matter, a bank merger or
acquisition will not be challenged (in the absence of other factors
indicating anticompetitive effects) unless the post-merger HHI is at
least 1800 and the transaction increases the HHI by more than 200
points. The Justice Department has stated that the higher than normal
HHI thresholds for screening bank mergers for anticompetitive effects

Legal Developments

Ten depository institutions will remain in operation
in the Montrose banking market upon consummation
of this proposal. The largest such depository institution is a subsidiary of a large, regional bank holding
company, and controls more than 35 percent of market
deposits. The Board also has considered that Colorado
permits interstate banking nationwide, and, therefore,
that there are a large number of potential entrants into
this market. In this regard, the Montrose banking
market is relatively attractive to potential entrants, as
evidenced by the fact that several banking organizations, including two de novo banks, have commenced
operations in the market in the past several years.
Finally, the Board sought comments on the competitive effects of this proposal from both the Department
of Justice and the OCC. The Department of Justice has
indicated that it does not believe the acquisition of
Montrose Bank by Banc One would have a significantly adverse effect on competition in any relevant
market, and the OCC has not provided any objection
to consummation of the proposal or indicated that the
proposal would have any significant adverse competitive effects.8 On the basis of the foregoing considerations and all the other facts of record, the Board has
concluded that consummation of Applicants' proposal
would not result in any significantly adverse effect on
competition or the concentration of banking resources
in the Montrose banking market or any other relevant
banking market.
Convenience and Needs Considerations
In acting upon an application to acquire a depository
institution under the BHC Act, the Board must consider the convenience and needs of the communities to
be served, and take into account the records of the
relevant depository institutions under the Community
Reinvestment Act (12 U.S.C. § 2901 et
seq.)
("CRA"). The CRA requires the federal financial
supervisory agencies to encourage financial institutions to help meet the credit needs of the local communities in which they operate consistently with the
safe and sound operation of such institutions. To
accomplish this end, the CRA requires the appropriate
federal supervisory authority to "assess the institution's record of meeting the credit needs of its entire
community, including low- and moderate-income
neighborhoods, consistent with the safe and sound

implicitly recognize the competitive effect of limited-purpose lenders
and other non-depository financial entities.
8. In addition, the Board notes that the OCC has approved the
merger Montrose Bank with and into Bank One Western pursuant to
the Bank Merger Act.




873

operation of such institution," and to take that record
into account in its evaluation of applications.9
In connection with these applications, the Board has
received comments from The Main Street Business
Association ("Protestant") objecting to this proposal.
Protestant criticizes generally the CRA performance
record of the Banc One organization, and raises issues
regarding the record of Banc One's lead subsidiary
bank in Ohio, Bank One, Columbus, N.A., Columbus,
Ohio ("Bank One Columbus"), including the bank's
record of small business lending in minority neighborhoods.10
The Board has carefully reviewed the CRA performance records of Banc One and its subsidiary banks,
the comments presented by Protestant and Banc One's
responses to those comments, as well as all other
relevant facts of record, in light of the CRA, the
Board's regulations, and the Statement of the Federal
Financial Supervisory Agencies Regarding the Community Reinvestment Act ("Agency CRA Statement").11

A. Evaluations of CRA Performance
The Agency CRA Statement provides that a CRA
examination is an important and often controlling
factor in the consideration of an institution's CRA
record and that these reports will be given great weight
in the applications process.12 In this regard, Bank One
Columbus received an "outstanding" rating in its most
recent publicly available examination report for CRA
performance conducted by the OCC as of May 1991
(the "1991 examination"). Bank One Western also
received an "outstanding" rating from the OCC at its
most recent examination conducted as of February
1993. Overall, the most recent CRA performance
examinations for Banc One's subsidiary banks show
28 "outstanding" ratings, 48 "satisfactory" ratings,
and 2 ratings of "needs to improve", one of which was
assigned by the OCC to Bank One Cleveland at its
most recent examination conducted as of April 1993.13

9. See 12 U.S.C. § 2903.
10. In addition, Protestant believes that there may exist some
inconsistencies in the OCC's examination ratings for CRA performance by Banc One's subsidiary banks, and has encouraged the
Board to examine factors in addition to these ratings. In this regard,
Protestant cites data concerning denial rates of Bank One Columbus
and Bank One Cleveland, N.A., Cleveland, Ohio ("Bank One Cleveland"), to African-American applicants for conventional home mortgages.
11. 54 Federal Register 13,742 (1989).
12. 54 Federal Register at 13,745 (1989).
13. The second rating of "needs to improve" was assigned to
Nicholas County Bank, Summersville, West Virginia, at its most
recent examination conducted by the Federal Deposit Insurance
Corporation as of December 1991, before this institution was acquired
by Banc One.

874

Federal Reserve Bulletin • September 1993

The Board also has considered the CRA performance
record of Montrose Bank, including the most recent
CRA performance examination conducted by the
OCC.

B. Recent Review of Banc One's CRA Record
In addition to considering the record of CRA performance examinations of Montrose Bank and Banc
One's subsidiary banks, the Board has carefully considered the actual CRA-related policies, procedures,
and programs instituted and in place at these organizations. In this regard, the Board notes that in connection with Banc One's recent application to acquire
Valley National Corporation, Phoenix, Arizona ("Valley National"), and certain of Valley National's banking and nonbanking subsidiaries, the Board conducted
a thorough review of the CRA performance record of
the Banc One organization.14 The Board's review
included consideration of numerous comments received with respect to that proposal from various
community organizations and other members of the
public, including Protestant. In the Valley National
Order, the Board concluded that the overall CRA
performance record of the Banc One organization,
including its CRA programs and policies, efforts to
ascertain community credit needs, marketing programs, HMDA data and lending practices, and record
of lending, community development, and other CRArelated activities, was consistent with approval of
Banc One's proposal to acquire the Valley National
organization.

C. Record of Bank One Columbus
In the area of small business lending, Bank One
Columbus maintains credit relationships with over
2,700 small businesses in the Columbus MSA with
annual revenues of $10 million or less. At the 1991
examination, the OCC concluded that the bank is an
active small business lender, and originated a reasonable volume of small business loans. The OCC noted
that Bank One Columbus is a very active participant in
small business lending programs sponsored by the
Small Business Administration and state and local
government agencies. In 1990, the bank closed 45
loans under these programs, totalling more than
$4.7 million.
The Board also has noted that a substantial portion
of the bank's small business loans are made to emerging businesses with annual revenues of less than

14. See Banc One Corporation, 79 Federal Reserve Bulletin 524
(1993) ("Valley National Order").




$1 million. For example, in 1992 Bank One Columbus
made 744 loans to such businesses for a total of
$39.8 million. Of these loans, 151 were to businesses in
low- and moderate-income areas, in the aggregate
amount of $9.1 million. The record also indicates that
a substantial portion of these loans were to businesses
in predominantly minority areas. Through the first
three quarters of 1992, 9 percent of such loans were
made in minority areas. Minority areas represent
approximately 10 percent of the census tracts in the
Columbus MSA. The Board also notes that the bank's
approval and denial rates for such small business loans
in minority areas is approximately the same as that for
small business credit applicants located in areas where
minorities represent less than 10 percent of the population.
As noted previously, Bank One Columbus received
an "outstanding" rating for CRA performance at the
most recent publicly available examination concluded
by the OCC. The record of these applications demonstrates that Banc One and Bank One Columbus have in
place the types of policies and procedures that the
Board and the other federal bank supervisory agencies
have indicated contribute to an effective CRA program. Many of these policies and procedures, particularly those instituted at the Banc One corporate level,
were discussed in the Valley National Order. The
Board has specifically reviewed the policies and procedures instituted at the Columbus bank in its consideration of these applications. In this regard, the OCC
concluded at the 1991 examination that the bank's
board of directors is actively involved in the CRA
program, and has adopted appropriate CRA policies,
including policies regarding the allocation of resources
and the establishment of an effective program structure. In addition, a committee of the board of directors
meets quarterly to review and discuss matters relating
to CRA performance. The bank's internal CRA committee, comprised of the CRA Officer, senior management, and officers representing various divisions of the
bank, meets monthly to provide guidance for the CRA
program. These and other policies and procedures
employed by Bank One Columbus are designed to
ensure an effective CRA program that includes involvement by senior management and the board of
directors.
Bank One Columbus has instituted an ascertainment
program to identify and respond to community credit
needs. At the 1991 examination, the OCC concluded
that this ascertainment program included all areas of
the bank's delineated community. Bank One Columbus has established a comprehensive officer calling
program to establish and maintain contacts with individuals and organizations throughout the community.
The calling program is overseen by the bank's CRA

Legal Developments

Officer and by the internal CRA committee. Other
significant ascertainment efforts include meetings of
the bank's Community Advisory Council, various
types of marketing surveys and analyses, and community outreach activities by various levels of bank
personnel. The OCC also concluded that the bank has
shown flexibility in developing credit products to meet
ascertained credit needs.
Bank One Columbus also has instituted a marketing
program designed to inform all segments of its community of the bank's services and credit products. The
OCC's 1991 examination found that the bank's marketing program was comprehensive and covered all
areas of the bank's delineated community, including
low- and moderate-income neighborhoods. The bank
uses general circulation and special media to target
particular segments of the community. Other marketing efforts include seminars for potential customers for
consumer and small business credit.
As indicated in the Valley National Order, Bank
One Columbus offers a wide range of credit products
for homeowners, consumers, and small businesses,
including products offered through governmental loan
programs such as those sponsored by the Federal
Housing Administration, the Veterans Administration,
the Small Business Administration, and the Ohio
Housing Finance Agency.15 At the 1991 examination,
the OCC concluded that the bank's lending record
demonstrated reasonable market penetration in all
segments of its service communities, including lowand moderate-income areas.
With respect to housing-related lending, Bank One
Columbus made 1,479 mortgage loans in 1991, for a
total of $117 million.16 Of these loans, 345 were to lowand moderate-income borrowers, in the aggregate
amount of $10.7 million. The bank also is an active
home-improvement lender, having made 2,767 such
loans in 1991 for a total of $31 million within the
Columbus MSA. Low- and moderate-income borrowers received 1,227 of these home improvement loans,
for a total of approximately $8.4 million. Bank One
Columbus also makes a substantial number of other
types of consumer loans. For example, the OCC
concluded at the 1991 examination that the bank was a
very active lender under guaranteed student loan
programs, having made over 13,000 student loans for
approximately $23 million from September 1, 1990,
through March 31, 1991.

15. The Board has noted that in 1990, the bank made 85 housing
loans through programs sponsored by the FHA, VA, and OHFA, for
a total of $4.5 million.
16. These figures are for conventional purchase money mortgages,
FHA and VA loans, and refinancings, and include loans originated by
Banc One Mortgage Corporation in Bank One Columbus service
areas.




875

The OCC also concluded that the bank had an
excellent record of participation in community development and redevelopment activities within its service
areas. In addition to investing in state and local bond
issues for housing projects, economic development,
and other purposes, Bank One Columbus has funded
development projects within its community, and,
through Banc One Community Development Corporation, has invested or committed funds to various
community organizations engaged in activities related
to affordable housing, including the Columbus Housing Partnership and the Ohio Equity Fund.
The Board also has reviewed data reported by
Bank One Columbus, as well as Banc One's other
subsidiary banks, under the Home Mortgage Disclosure Act ("HMDA"). These data indicate some
disparities in approvals and denials of loan applications according to racial and ethnic group and income
status in the areas served by these banks. Because all
banks are obligated to adopt and implement lending practices that ensure not only safe and sound
lending but also equal access to credit by creditworthy applicants regardless of race, the Board is concerned when the record of an institution indicates
disparities in lending to minority credit applicants.
The Board recognizes, however, that HMDA data
alone provide only a limited measure of any given
institution's lending in its community. The Board
also recognizes that HMDA data have limitations
that make the data an inadequate basis, absent other
information, for conclusively determining whether
an institution has engaged in illegal discrimination on
the basis of race or ethnicity in making lending
decisions.
In this regard, the Board notes that the OCC
determined at the 1991 examination that the community delineation of Bank One Columbus was reasonable, and did not arbitrarily exclude any low- and
moderate-income neighborhoods. The OCC also concluded that the bank's geographic distribution of
credit applications, extensions, and denials demonstrated reasonable penetration of all segments of its
local community, including low- and moderate-income and minority areas, with no evidence of exclusionary practices. In this regard, 13.4 percent of the
bank's 1991 housing-related loans were made to
minorities, a proportion that is higher than the 12.6
percent of the Columbus MSA population that is
minority. The Board also has noted that at the 1991
examination, the OCC found no evidence that the
bank engages in illegal discrimination or other illegal
credit practices. The record also indicates that
Bank One Columbus supports its antidiscrimination
policies and procedures with employee compliance
training.

876

Federal Reserve Bulletin • September 1993

D. Initiatives by Bank One Cleveland
In the Valley National Order, the Board stated that it
expected Banc One to take steps that would address
the areas of weakness identified in the OCC's most
recent examination of Bank One Cleveland. The
Board also required Banc One to submit to the Board,
when delivered to the OCC, a copy of its plan to
address these deficiencies in the CRA record of Bank
One Cleveland, and further required Banc One to
submit quarterly progress reports with respect to this
improvement plan.
The Board has reviewed the CRA corrective action
plan for Bank One Cleveland, as well as the first
quarterly progress report on the plan, in its consideration of these applications. The corrective action plan
calls for the bank to evaluate existing CRA-related
programs with a view toward achieving a more equitable distribution of credit throughout its service communities. To this end, the bank will conduct a thorough geographic analysis of its consumer and
residential real estate lending patterns, and has established provisional quantitative indicators to measure
credit distribution throughout its market. The bank
also will conduct an evaluation of existing credit
products and lending programs. This evaluation will
include assessments of marketing and advertising programs, as well as the ability of existing loan products
to meet identified community credit needs. The bank
also will establish lending targets for each underserved
area that has been identified as an area of market
opportunity, and will develop specific strategies to
achieve these objectives.
Since the Valley National Order was issued, Bank
One Cleveland has introduced several new loan products designed to meet the credit needs of low- and
moderate-income communities, including:
(1) A home mortgage product with low down payment requirements and flexible underwriting criteria;
(2) A mortgage loan product that will cover both
acquisition costs and rehabilitation costs;
(3) A secured home improvement loan product; and
(4) A mortgage loan for one-to-eight unit rental
properties.
The Board also notes that Bank One Cleveland has
recruited a new CRA Officer, who reports directly to
the chief executive officer and board of directors of the
bank. This CRA Officer will coordinate the efforts of
an expanded staff, including regional CRA coordinators, a community lending officer, and a low- and
moderate-income market analyst. In addition, members of the bank's senior management have been
assigned to a reorganized CRA Management Commit


tee. The bank also has established an additional Community Advisory Council, which will focus exclusively
on credit needs in the City of Cleveland. The Board
will continue to monitor implementation of these and
other steps developed by Banc One and Bank One
Cleveland, and continues to expect Banc One and
Bank One Cleveland to implement these steps fully.17

E. Conclusion Regarding Convenience and
Needs Factor
The Board has carefully considered all the facts of
record, including the comments received, in reviewing
the convenience and needs factor under the BHC Act.
Based on a review of the entire record, including
information provided by Protestant and the results of
the most recent CRA performance examinations conducted by the relevant primary regulators, as well as
the information that was also relevant to and considered in the Valley National Order, the Board believes
that the efforts of Banc One and Colorado Western to
help meet the credit needs of all segments of the
communities served by their subsidiary banks, including low- and moderate-income neighborhoods, as well
as all other convenience and needs considerations, are
consistent with approval of this proposal.
Other Considerations
On the basis of all the facts of record, including the
representations and commitments furnished by Applicants, the Board has concluded that the financial and
managerial resources and future prospects of Banc
One, Colorado Western, and their respective subsidiaries, and all other supervisory factors the Board
must consider under section 3 of the BHC Act, are
consistent with approval of this proposal.
Based on the foregoing and other facts of record, the
Board has determined that the applications should be,
and hereby are, approved. This approval is expressly
conditioned upon compliance by Applicants with all
the commitments made in connection with these applications and with the conditions referenced in this
Order. The commitments and conditions relied on by

17. The Board also notes that Banc One and Mayor White of
Cleveland have announced a joint initiative between Bank One
Cleveland and the city designed to enhance an expansion of financial
services in targeted areas. Under this initiative, Bank One Cleveland
committed to introduce a variety of credit products, and to seek to
employ the services of a homebuyer counseling provider to assist lowand moderate-income residents of Cleveland in applying for residential loans at the bank. In addition, the initiative provides that the bank
will undertake a cooperative effort with the city to finance new
housing development in targeted areas. Moreover, Bank One Cleveland will conduct feasibility studies of sites identified by the city for
possible new branch locations.

Legal Developments

the Board in reaching this decision are deemed to be
conditions imposed in writing by the Board in connection with its findings and decision, and, as such, may
be enforced in proceedings under applicable law.
This transaction shall not be consummated before
the thirtieth calendar day following the effective date
of this Order, or later than three months after the
effective date of this Order, unless such period is
extended for good cause by the Board or by the
Federal Reserve Bank of Cleveland, acting pursuant to
delegated authority.
By order of the Board of Governors, effective
July 12, 1993.
Voting for this action : Vice Chairman Mullins and Governors Angell, Kelley, LaWare, Lindsey, and Phillips. Absent
and not voting: Chairman Greenspan.
JENNIFER J. JOHNSON

Associate Secretary of the Board

First Financial Corporation
Terre Haute, Indiana
Order Approving the Merger of Bank Holding
Companies
First Financial Corporation, Terre Haute, Indiana
("First Financial"), a bank holding company within
the meaning of the Bank Holding Company Act
("BHC Act"), has applied under section 3(a)(5) of the
BHC Act (12 U.S.C. § 1842(a)(5)) to merge with Parke
Bancorp, Rockville, Indiana, and thereby to acquire
the Parke State Bank, Rockville, Indiana ("Bank").
Notice of the application, affording interested persons an opportunity to submit comments, has been
published (58 Federal Register 13,266 (1993)). The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the factors set forth in section 3(c) of
the BHC Act.
First Financial is the 11th largest commercial banking organization in Indiana, controlling deposits of
approximately $826.5 million, representing 1.7 percent
of total deposits in commercial banks in the state.1
Parke Bancorp is the 88th largest commercial banking
organization in the state, controlling deposits of $66.9
million, representing less than 1 percent of total deposits in commercial banking organizations in the
state. Upon consummation of this proposal, First
Financial would remain the 11th largest commercial
banking organization in the state with deposits of
$893.4 million, representing approximately 1.9 percent
1. Deposit data are as of June 30, 1992.




877

of total deposits in commercial banking organizations
in the state.
First Financial and Bank compete directly in the
Terre Haute, Indiana, banking market.2 First Financial is the largest depository institution in the market,
controlling deposits of $708.3 million, representing
46.3 percent of total deposits in depository institutions
in the market ("market deposits").3 Bank is the smallest depository institution in the market, with market
deposits of $9.4 million, representing less than 1 percent of total deposits in depository institutions in the
market. The Herfindahl-Hirschman Index ("HHI")
for the market would increase by 56 points to 2781.4
Although consummation of this proposal would result in some increase in market concentration as
measured by the HHI, nine depository institutions,
including seven commercial banking organizations,
would remain in the market. These commercial bank
competitors include two of the largest commercial
banking organizations in the state. In addition, several
aspects of the Terre Haute banking market make it an
attractive banking market for potential banking competitors to enter.5 Indiana has nationwide reciprocal
interstate banking and permits de novo branch entry
by commercial banks in contiguous counties and by
thrifts from anywhere in the state, thus facilitating
entry into the market by potential competitors. In this
regard, several out-of-market banking firms have entered the Terre Haute banking market since 1985.
In light of the relatively small increase in market
concentration and First Financial's market share, the
number of competitors remaining in the market, the
2. The Terre Haute banking market is approximated by Clay and
Vigo Counties; Clinton and Helt townships in Vermillion County;
Florida, Jackson, and Raccoon townships in Parke County; and
Curry, Fairbanks, and Jackson townships in Sullivan County, all in
Indiana.
3. Market data are as of June 30, 1992. In this context, depository
institutions include commercial banks and savings banks. The Board
previously has indicated that thrift institutions have become, or have
the potential to become, major competitors of commercial banks. See
Midwest Financial Group, 75 Federal Reserve Bulletin 386 (1989);
National City Corporation, 70 Federal Reserve Bulletin 743 (1984). In
considering the competition offered by thrifts in the Terre Haute
banking market, market share data are based on calculations in which
the deposits of two thrift institutions in the market are included at
50 percent.
4. Under the revised Department of Justice Merger Guidelines, 49
Federal Register 26,823 (June 29, 1984), a market in which the
post-merger HHI is over 1800 is considered highly concentrated. The
Department of Justice has informed the Board that a bank merger or
acquisition generally will not be challenged (in the absence of other
factors indicating anticompetitive effects) unless the post-merger HHI
is at least 1800 and the merger increases the HHI by at least 200
points. The Justice Department has stated that the higher than normal
HHI thresholds for screening bank mergers and acquisitions for
anticompetitive effects implicitly recognizes the competitive effect of
limited-purpose lenders and other non-depository financial entities.
5. For example, the Terre Haute banking market is one of the state's
11 Metropolitan Statistical Areas and ranks third in deposits per
banking office and third in recent growth of market deposits.

878

Federal Reserve Bulletin • September 1993

attractiveness of the market to potential entrants, and
other facts of record in this case, the Board concludes
that consummation of the proposal would not have a
significantly adverse effect on competition or the concentration of banking resources in the Terre Haute
banking market, or in any other relevant banking
market.
Considerations relating to the financial and managerial resources and future prospects of First Financial,
Parke, and their subsidiary banks, and other supervisory factors that the Board is required to consider
under section 3 of the BHC Act, also are consistent
with approval of this application. The Board also finds
that considerations relating to the convenience and
needs of the communities to be served are consistent
with approval.
Based on the foregoing and other facts of record, the
Board has determined that the application should be,
and hereby is, approved. The Board's approval of this
transaction is specifically conditioned upon compliance with the commitments given in connection with
this application. For the purposes of this action, the
commitments and conditions relied on in reaching this
decision are both considered to be conditions imposed
in writing by the Board and, as such, may be enforced
in proceedings under applicable laws. The transaction
approved in this order shall not be consummated
before the thirtieth calendar day following the effective
date of this Order, or later than three months after the
effective date of this Order, unless such period is
extended for good cause by the Board or by the
Federal Reserve Bank of Chicago, pursuant to delegated authority.
By order of the Board of Governors, effective
July 12, 1993.

Bank of Spring Lake Park ("Bank"), both of Spring
Lake Park, Minnesota.1
Notice of the application, affording interested persons an opportunity to submit comments, has been
published (58 Federal Register 26,785 (1993)). The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the factors set forth in section 3(c) of
the BHC Act.
Norwest, with total consolidated assets of
$45.5 billion, operates 85 banking subsidiaries located
in 13 states.2 Norwest is the second largest commercial
banking organization in Minnesota, controlling deposits
of approximately $10.1 billion, representing 23.1 percent of the deposits in commercial banks in the state.3
M & D is the 113th largest commercial banking organization in Minnesota, controlling $48.2 million in deposits, representing less than 1 percent of the deposits in
commercial banks in the state. Upon consummation of
the proposal, Norwest would remain the second largest
commercial banking organization in Minnesota, controlling deposits of $10.2 billion, representing 23.2 percent of the total deposits in commercial banks in the
state.
Competitive Considerations
Norwest and M & D compete directly in the Minneapolis-St. Paul banking market.4 Norwest is the second largest commercial bank or thrift institution ("depository institution") in the market, controlling
deposits of $7.4 billion, representing 27.8 percent of
total deposits in depository institutions in the market
("market deposits").5 M & D is the 46th largest
depository institution in the market, controlling approximately $48.2 million in deposits, representing

Voting for this action: Vice Chairman Mullins and Governors Angell, Kelley, LaWare, Lindsey, and Phillips. Absent
and not voting: Chairman Greenspan.
JENNIFER J. JOHNSON

Associate Secretary of the Board

Norwest Corporation
Minneapolis, Minnesota
Order Approving the Acquisition of a Bank
Norwest Corporation, Minneapolis, Minnesota ("Norwest"), a bank holding company within the meaning of
the Bank Holding Company Act ("BHC Act"), has
applied under section 3 of the BHC Act (12 U.S.C.
§ 1842) to acquire M & D Holding Company
("M & D") and thereby indirectly acquire First State



1. Norwest proposes to acquire Bank by merging M & D into
Norwest and subsequently merging Bank into a newly chartered
national bank, to operate under the name of Bank of Spring Lake
Park, N.A. The proposed Bank merger is subject to approval by the
Office of the Comptroller of the Currency ("OCC") under the Bank
Merger Act (12 U.S.C. § 1828(c)).
2. Asset data are as of March 31, 1993.
3. State and market share data are as of June 30, 1992.
4. The Minneapolis-St. Paul banking market is comprised of Anoka,
Hennepin, Ramsey, Washington, Carver, Scott, and Dakota Counties, and portions of Chisago, Le Sueur, Sherburne, and Wright
Counties in Minnesota, and the town of Hudson in St. Croix County
in Wisconsin.
5. Market share data are based on calculations in which the deposits
of thrift institutions are included at 50 percent. The Board previously
has indicated that thrift institutions have become, or have the potential to become, significant competitors of commercial banks. See
Midwest Financial Group, 75 Federal Reserve Bulletin 386 (1989);
National City Corporation, 70 Federal Reserve Bulletin 743 (1984).
Thus, the Board has regularly included thrift deposits in the calculation of market share on a 50 percent weighted basis. See, e.g., First
Hawaiian Inc., 77 Federal Reserve Bulletin 52 (1991).

Legal Developments

0.18 percent of market deposits.6 Upon consummation
of this proposal, Norwest would remain the second
largest depository institution in the market, controlling
deposits of $7.5 billion, representing 28 percent of
market deposits. The Herfindahl-Hirschman Index
("HHI") would increase by 10 points to 2026.7
The Board previously has indicated that merger
transactions in the Minneapolis-St. Paul banking market involving one of the two largest depository institutions in the market warrant close review because of
the size of these institutions relative to other market
competitors.8 In this case, M & D is one of the smaller
depository organizations in the Minneapolis-St. Paul
banking market, controlling 0.18 percent of market
deposits. Even considering the effect on market concentration in light of previous acquisitions by the two
largest depository institutions, this proposal would not
have a significantly adverse competitive effect in the
market. In addition, 103 competitors will remain in the
market, including 93 commercial banks and 10 thrifts.
The Minneapolis-St. Paul banking market is a major
urban area and is attractive for entry. Seven commercial banking institutions, including two banks chartered de novo in 1990, and one thrift institution have
entered the market since early 1988. Moreover, one of
the commercial banking institutions that has entered
the market during this period has become the fourth
largest depository institution in the market. Minnesota
has relaxed its restrictions on interstate banking acquisitions, which has increased the number of potential
entrants into the market.9 In addition, banks with their
principal office within the seven-county area that comprises most of the Minneapolis-St. Paul banking market may establish detached facilities (branches)

6. In addition to Bank, the owners of M & D also control First Bank
Coon Rapids, Coon Rapids, Minnesota ("Coon Rapids Bank"), with
deposits of $62 million in the Minneapolis-St. Paul banking market.
The owners have reached a separate agreement to sell their interest in
Coon Rapids Bank to another bank holding company that already is in
the market.
7. Under the revised Department of Justice Merger Guidelines, 49
Federal Register 26,823 (June 29, 1984), a market in which the
post-merger HHI is above 1800 is considered highly concentrated. In
such markets, the Justice Department is likely to challenge a merger
that increases the HHI by more than 50 points. The Justice Department has informed the Board that a bank merger or acquisition
generally will not be challenged (in the absence of other factors
indicating anti-competitive effects) unless the post-merger HHI is at
least 1800 and the merger increases the HHI by 200 points. The Justice
Department has stated that the higher than normal HHI thresholds for
screening bank mergers for anti-competitive effects implicitly recognize the competitive effects of limited-purpose lenders and other
non-depository financial entities.
8. See First Bank System, Inc., 79 Federal Reserve Bulletin 50
(1993). In this regard, acquisitions by either of these two banking
organizations of a series of depository organizations with relatively
small market shares could, on a cumulative basis, lead to significant
anti-competitive effects.
9. See Reciprocal Interstate Banking Act, Minn. Stat. Ann. § 48.90
et seq.




879

through mergers elsewhere within these seven counties without being subject to the five-branch limitation
otherwise imposed under Minnesota law.10
In light of all the facts in this case, including the
number of competitors remaining in the market, the
size of M & D, and other facts of record, the Board
concludes that consummation of this proposal would
not have a significantly adverse effect on competition
or the concentration of resources in the MinneapolisSt. Paul banking market or any other relevant banking
market.
Other Considerations
The Board concludes that the financial and managerial
resources and future prospects of Norwest, its subsidiaries, and M & D are consistent with approval. The
Board also concludes that considerations relating to
the convenience and needs of the communities to be
served and the other supervisory factors that the
Board must consider under section 3 of the BHC Act
are consistent with approval of this proposal.11
Based on all the facts of record, including the
commitments made by Norwest in connection with
this application, the Board has determined that the
application should be, and hereby is, approved. The
Board's approval of this proposal is expressly conditioned on compliance with the commitments made in
connection with this application. The commitments
and conditions relied on by the Board in reaching its
decision are both deemed to be conditions imposed in
writing by the Board in connection with its findings
and decision, and, as such, may be enforced in proceedings under applicable law.

10. See Minn. Stat. Ann. § 49.34, subd. 2(b).
11. The Board has received a comment from a former customer of
Norwest Bank Mesabi, N.A., Virginia, Minnesota ("Norwest Mesabi"), alleging improper acts by bank personnel in connection with a
foreclosure proceeding initiated by Norwest Mesabi on real estate
collateral securing several of the commenter's loans. Norwest denies
these allegations and notes that Norwest Mesabi's right to take title to
the real estate collateral has been litigated by the commenter in
Minnesota state court. The Board also notes that the commenter's
allegations are currently under investigation by Norwest Mesabi's
primary federal banking regulator, the OCC, which has the statutory
authority to take appropriate actions if the commenter's allegations
can be verified. This commenter also generally asserts that Norwest
Mesabi's lending practices do not meet the requirements of the
Community Reinvestment Act (12 U.S.C. § 2901 et seq.) ("CRA").
The Board notes that Norwest Mesabi received a "satisfactory"
rating from the OCC at its most recent examination for CRA performance, and 84 of the 85 subsidiary banks of Norwest received a
"satisfactory" or "outstanding" rating from their primary federal
banking regulator at their most recent examination for CRA performance. The remaining bank, which represents less than 1 percent of
Norwest's total consolidated assets, has taken appropriate steps to
address the weaknesses in its CRA program. In light of all the facts of
record, including relevant examination reports, the Board does not
believe that these comments warrant denial of this application.

880

Federal Reserve Bulletin • September 1993

This transaction shall not be consummated before
the thirtieth calendar day following the effective date
of this Order, or later than three months after the
effective date of this Order, unless such period is
extended for good cause by the Board or by the
Federal Reserve Bank of Minneapolis, acting pursuant
to delegated authority.
By order of the Board of Governors, effective
July 15, 1993.
Voting for this action: Chairman Greenspan and Governors
Mullins, Lindsey, and Phillips. Voting against this action:
Governors Angell, Kelley, and LaWare.
JENNIFER J. JOHNSON

Associate Secretary of the Board

by 714 points. This proposal is the fourth acquisition for
Norwest in the last five and one-half years and represents
through a series of acquisitions an increase of 8 percentage points in market share and of 291 points in market
concentration as measured by the HHI.
Under these circumstances, we believe that any
additional acquisition in this market by these companies would result in a substantial lessening of competition and we would not approve any further acquisitions by them in this market in the absence of a
significant change in the market's structure.
July 15, 1993

Pinnacle Bancorp, Inc.
Central City, Nebraska

Dissenting Statement of Governors Angell, Kelley,
and LaWare

Order Approving the Acquisition of a Bank Holding
Company and the Merger of Banks

We disagree with the Board's action in this case. In
light of previous acquisitions by this company and the
other large depository institution in the MinneapolisSt. Paul banking market, we believe that this proposal
would continue the trend towards a substantial concentration of banking resources in this market.
In previous cases we have noted that the Minneapolis-St. Paul market is unusual among major banking
markets in that the two largest depository institutions
control over 60 percent of market deposits. These
institutions have over the years increased their dominant position in the market through acquisitions of
competitors rather than through de novo expansion.
For example, the third largest competitor in the market was recently acquired by one of the two market
leaders with the result that the largest remaining
depository institution competing with the two market
leaders is a thrift controlling market deposits of less
than 5 percent.
The two market leaders have been permitted to
diminish competition in the Minneapolis-St. Paul market through absorption of competitors because the
traditional analysis applied by the Board does not give
sufficient weight to the competitive effects of a series
of acquisitions by these institutions. In this regard, the
two largest institutions in this market could acquire
virtually every remaining competitor without reaching
the threshold level for challenge under the Board's
methodology.
This proposal is the ninth acquisition of a competitor
made by the two dominant companies in the market in the
last five and one-half years. These companies have increased through a series of acquisitions their market share
by 16 percentage points and market concentration as
measured by the Herfindahl-Hirschman Index ("HHI")

Pinnacle Bancorp, Inc., Central City, Nebraska ("Pinnacle"), a bank holding company within the meaning
of the Bank Holding Company Act ("BHC Act"), has
applied under section 3 of the BHC Act (12 U.S.C.
§ 1842) to acquire all the voting shares of Windsor
Bancorporation, Inc. ("Windsor"), and thereby indirectly acquire Bank of Windsor ("Bank"), both of
Windsor, Colorado. Pinnacle also has applied under
section 18(c) of the Federal Deposit Insurance Act
(12 U.S.C. § 1828(c)) (the "Bank Merger Act") to
merge Bank with The First Security Bank of Windsor,
Windsor, Colorado ("First Security Bank"), a subsidiary bank of Pinnacle.1
Notice of the applications, affording interested persons an opportunity to submit comments, has been
published (58 Federal Register 26,785 (1993)). As
required by the Bank Merger Act, reports on the
competitive effects of the merger were requested from
the United States Attorney General, the Office of the
Comptroller of the Currency ("OCC"), and the Federal Deposit Insurance Corporation ("FDIC"). The
time for filing comments has expired, and the Board
has considered the applications and all comments
received in light of the factors set forth in the BHC Act
and the Bank Merger Act. 2
Pinnacle, with consolidated assets of $893.9 million,
controls 15 banks in Nebraska, Colorado, Wyoming,
and Kansas.3 Pinnacle is the 19th largest commercial
banking organization in Colorado, controlling deposits




1. Following consummation of this proposal, Bank will be merged
into First Security Bank. The surviving bank will be renamed Bank of
Colorado, Windsor, Colorado.
2. See 12 U.S.C. § 1842(c), 1828(c)(5).
3. Asset data are as of December 31, 1992.

Legal Developments

of $157.8 million, representing less than 1 percent of
the total deposits in commercial banking organizations
in the state.4 Windsor is the 147th largest commercial
banking organization in Colorado, controlling deposits
of $20.5 million, representing less than 1 percent of the
total deposits in commercial banking organizations in
the state. Upon consummation of this proposal, Pinnacle would become the 15th largest commercial banking organization in Colorado, controlling deposits of
$178.3 million, representing less than 1 percent of the
total deposits in commercial banking organizations in
the state.
Douglas Amendment
Section 3(d) of the BHC Act, the Douglas Amendment, prohibits the Board from approving an application by a bank holding company to acquire any bank
located outside the bank holding company's home
state, unless such acquisition is "specifically authorized by the statute laws of the State in which such
bank is located, by language to that effect and not
merely by implication."5 For the purposes of the
Douglas Amendment, the home state of Pinnacle is
Nebraska.6
Colorado law permits a bank holding company located outside of Colorado to acquire a bank in Colorado, subject to certain conditions.7 After reviewing
this proposal, the Colorado State Banking Board has
determined that Pinnacle's proposed acquisition of
Windsor is permissible under Colorado law, and has
approved this acquisition. Accordingly, Board approval of this proposal is not prohibited by the Douglas
Amendment.
Definition of the Relevant Banking Market
The BHC Act and the Bank Merger Act provide that
the Board may not approve a proposal submitted
under these statutes if the proposal would result in a
monopoly or the effect of the proposal may be substantially to lessen competition in any relevant banking market, unless the Board finds "that the anticom-

4. State deposit data are as of December 31, 1992.
5. 12 U.S.C. § 1842(d).
6. A bank holding company's home state is that state in which the
operations of the bank holding company's banking subsidiaries were
principally conducted on July 1, 1966, or the date on which the
company became a bank holding company, whichever is later. The
operations of a bank holding company are considered principally
conducted in that state in which the total deposits of all such banking
subsidiaries are largest.
7. See Colo. Rev. Stat. § 11-6.4-103 (Supp. 1992). See also First
Western Corporation, 79 Federal Reserve Bulletin 69, 72 (1993)
(approval of the acquisition of a Colorado bank by a Nebraska bank
holding company).




881

petitive effects of the proposed transaction are clearly
outweighed in the public interest by the probable effect
of the transaction in meeting the convenience and
needs of the community to be served."8 In evaluating
the competitive factors in this case, the Board has
carefully considered comments from a number of
individuals ("Protestants") who maintain that the proposal would result in significantly adverse competitive
effects in the market for banking services in the town
of Windsor, Colorado ("Windsor"). Bank and First
Security Bank are the only two banking organizations
located in Windsor.
The Board and the courts have found that the
relevant banking market for analyzing the competitive
effects of a proposal must reflect commercial and
banking realities and must consist of the local area
where local customers can practicably turn for alternatives.9 The Board has considered all the facts in this
case, including comments from the Protestants, and
concludes that the relevant geographic market to evaluate the competitive effects of this proposal is the area
that includes all of Weld County, Colorado, except the
towns of Erie, Fort Lupton, Frederick, and Keenesburg (hereinafter referred to as the "Greeley banking
market").
Windsor, a town of approximately 5,000 in Weld
County, is 12 miles northwest of Greeley. Greeley has
a population of more than 60,000 and is the business
center of Weld County. Travel time to Greeley from
Windsor is relatively short, and data on traffic patterns
collected by the Colorado Highway Department indicate that there is substantial commuting between
Greeley and the western portions of Weld County,
including Windsor.
Greeley also has been designated as a Rand McNally Basic Trading Center for the area that includes
Windsor, because Greeley serves as a center for
shopping by residents of that area. This Trading Center designation is based on a determination that consumers in this area ordinarily travel to Greeley to
purchase retail goods.10
Residents of Windsor are informed of available
practicable alternatives for banking services in the
Greeley banking market through commercial advertising. For example, the daily newspaper in Greeley, The
Greeley Tribune, has a paid circulation in Windsor of
approximately 1,200, reaching more than half of the

8. 12 U.S.C. §§ 1842(c), 1828(c)(5).
9. See St. Joseph Valley Bank, 68 Federal Reserve Bulletin 673, 674
(1982).
10. In this regard, Windsor has no supermarkets and only one small
grocery store. Trading Centers such as Greeley also are viewed
as serving their surrounding areas with various specialized services,
such as medical care, entertainment, higher education and a daily
newspaper.

882

Federal Reserve Bulletin • September 1993

2,000 households in Windsor. In addition, bankers
interviewed by the Federal Reserve Bank of Kansas
City in Greeley confirm that their institutions are in
competition with banks in Windsor,11 and that the
residents of Windsor consider Greeley banks as their
primary alternatives for banking services outside
Windsor.
After review of this data and the other facts of
record, the Board believes that the record indicates
that customers in Windsor reasonably can and do turn
to providers of banking services throughout the Greeley banking market. Based on all the facts of record,
the Board finds that the relevant geographic market in
this case is the Greeley banking market as defined
above.

The Attorney General, the OCC, and the FDIC have
not objected to consummation of this proposal or
indicated that the proposal would have any significantly adverse competitive effects. Accordingly, in
light of the small increase in concentration, the number of competitors remaining in the market, and other
facts of record, the Board concludes that consummation of this proposal is not likely to result in any
significantly adverse effect on competition in the Greeley banking market or any other relevant banking
market.
Other Considerations

Pinnacle is the fifteenth largest commercial bank or
thrift institution ("depository institution") in the market, controlling deposits of $16.6 million, representing
2 percent of total deposits in depository institutions in
the market ("market deposits").12 Windsor is the
fourteenth largest depository institution in the market,
controlling deposits of $17.5 million, representing 2.2
percent of market deposits. Upon consummation of
this proposal, Pinnacle would become the fifth largest
depository institution in the Greeley banking market,
controlling deposits of $34.1 million, representing 4.2
percent of market deposits. Sixteen competitors would
remain in the Greeley banking market, including subsidiary banks of two large interstate banking organizations, each with market shares exceeding 20 percent.
The banking market would remain moderately concentrated, and the Herfindahl-Hirschman Index ("HHI")
would increase by nine points to 1551.13

The Board concludes that the financial and managerial resources, supervisory factors, and future prospects of Pinnacle and Windsor are consistent with
approval of these applications. The Board also finds
that considerations relating to the convenience and
needs of the communities to be served are consistent
with approval.14
Based on the foregoing and other facts of record,
the Board has determined that the applications
should be, and hereby are, approved. The Board's
approval is specifically conditioned upon compliance
with all of the commitments made by Pinnacle in
connection with these applications. For the purpose
of this action, these commitments and conditions will
both be considered conditions imposed in writing
and, as such, may be enforced in proceedings under
applicable law.
This transaction shall not be consummated before
the thirtieth calendar day following the effective date
of this Order, or later than three months after the
effective date of this Order, unless such period is
extended for good cause by the Board or by the

11. The Reserve Bank surveyed all the banks headquartered in
Greeley.
12. Market data are as of June 30,1992. Market share data are based
on calculations in which the deposits of thrift institutions are included
at 50 percent. The Board previously has indicated that thrift institutions have become, or have the potential to become, major competitors of commercial banks. See Midwest Financial Group, 75 Federal
Reserve Bulletin 386 (1989); National City Corporation, 70 Federal
Reserve Bulletin 743 (1984). Thus, the Board has regularly included
thrift deposits in the calculation of market share on a 50 percent
weighted basis. See, e.g., First Hawaiian Inc., 77 Federal Reserve
Bulletin 52 (1991).
13. Under the revised Department of Justice Merger Guidelines,
49 Federal Register 26,823 (June 29, 1984), a market in which the
post-merger HHI is between 1000 and 1800 is considered moderately
concentrated. A market in which the post-merger HHI is above 1800
is considered to be highly concentrated. In such markets, the Justice
Department is likely to challenge a merger that increases the HHI by
more than 50 points. The Justice Department has informed the
Board that a bank merger or acquisition generally will not be
challenged (in the absence of other factors indicating anti-competitive effects) unless the post-merger HHI is at least 1800 and the
merger or acquisition increases the HHI by at least 200 points. The

Justice Department has stated that the higher than normal threshold
for an increase in the HHI when screening bank mergers and
acquisitions for anti-competitive effects implicitly recognizes the
competitive effect of limited-purpose lenders and other non-depository financial entities.
14. Several Protestants have alleged in general terms that this
proposal is not in the best interests of the community served by Bank
and First Security Bank and, in particular, the elderly residents of
Windsor. The Board notes that both Bank and First Security Bank
received "satisfactory" ratings during their most recent examinations
for performance under the Community Reinvestment Act (12 U.S.C.
§ 2901 et seq.) from their primary regulators (Bank—Federal Reserve
Bank of Kansas City as of June 1992; First Security Bank—FDIC as
of July 1992). In this regard, examiners found that the lending record
of both banks, including small business lending, satisfactorily assisted
in meeting the credit needs of the community, including low- and
moderate-income areas.
The record also indicates that First Security Bank offers a variety of
banking services to customers, age 59 or over, including a no-fee
checking account that features free money orders, travelers checks,
safety deposit boxes, and notary service. Based on all facts of record,
including reports of examination, the Board does not believe that the
comments warrant denial of these applications.

Competitive Effects in the Greeley Banking Market




Legal Developments

Federal Reserve Bank of Kansas City, pursuant to
delegated authority.
By order of the Board of Governors, effective
July 12, 1993.
Voting for this action: Vice Chairman Mullins and Governors Angell, Kelley, LaWare, Lindsey, and Phillips. Absent
and not voting: Chairman Greenspan.
JENNIFER J. JOHNSON

Associate Secretary of the Board

Rice Insurance Agency, Inc.
Strasburg, Colorado
Order Approving Acquisition of Bank
Rice Insurance Agency, Inc., Strasburg, Colorado
("Rice"), a bank holding company within the meaning
of the Bank Holding Company Act ("BHC Act"), has
applied for the Board's approval under section 3 of the
BHC Act (12 U.S.C. § 1842) to acquire 90.1 percent of
the voting shares of The Byers State Bank, Byers,
Colorado ("Byers Bank").1
Notice of the application, affording interested persons an opportunity to submit comments, has been
published (58 Federal Register 27,573 (1993)). The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the factors set forth in section 3(c) of
the BHC Act.
Rice operates one subsidiary bank in Colorado. The
principal shareholders of Rice control other banks that
operate in Colorado and New Mexico (collectively, the
"Moore Chain"). The Moore Chain is the 16th largest
commercial banking organization in Colorado, controlling $169.3 million in deposits, representing less than
1 percent of total deposits in commercial banks in the
state.2 Byers Bank is the 158th largest commercial banking organization in Colorado, controlling
$17.4 million in deposits, representing less than 1 percent of total deposits in commercial banks in the state.
Upon consummation of the proposed acquisition, the
Moore Chain would become the 15th largest commercial banking organization in Colorado, controlling
$186.7 million in deposits, representing less than
1 percent of total deposits in commercial banks in the
state.

1. Rice intends to merge Byers Bank with and into Rice's sole
subsidiary, The First National Bank of Strasburg, Strasburg, Colorado ("Strasburg Bank"). This bank merger is subject to the approval
of the Office of the Comptroller of the Currency ("OCC") pursuant to
the Bank Merger Act (12 U.S.C. § 1828(c)).
2. State deposit data are as of December 31, 1992.




883

Competitive Considerations
The BHC Act provides that the Board may not approve a proposal submitted under section 3 of the
BHC Act if:
(1) The proposal would result in a monopoly in any
relevant banking market, or
(2) The effect of the proposal may be substantially to
lessen competition in any relevant banking market,
unless the Board finds "that the anticompetitive
effects of the proposed transaction are clearly outweighed in the public interest by the probable effect
of the transaction in meeting the convenience and
needs of the community to be served."3
The Board has received comments from several members of the Byers community ("Protestants") objecting to Rice's proposed acquisition of Byers Bank on
competitive grounds. These objections are based upon
Protestants' concerns that consummation of the proposal would have anticompetitive effects in the market
for banking services in the area currently served by
Byers Bank. Protestants contend that the acquisition
would eliminate competition in this relatively rural
area.4
Definition of the Relevant Banking Market
The Board and the courts have found that the relevant
banking market for analyzing the competitive effects
of a proposal must reflect commercial and banking
realities and must consist of the local area where the
banks involved offer their services and where local
customers can practicably turn for alternatives.5 In
determining the relevant geographic market in this
case, the Board has carefully considered all the facts
of record, including Protestants' comments and data
collected by the Federal Reserve Bank of Kansas City
and Board staff.
A number of factors in this case indicate that the
communities served by Strasburg Bank and Byers
Bank are, as an economic matter, part of the Denver
metropolitan area. Bennett, Strasburg, and Byers are
relatively small communities, each having a population of fewer than 2,000 persons.6 Few services or
employment opportunities are available locally. For
example, among the three communities there are no

3. 12 U.S.C. § 1842(c)(1).
4. Protestants assert that the anticompetitive effects of the proposal
could include a reduction of banking services in Byers, as well as
increased fees and less competitive interest rates, all to the detriment
of the local economy.
5. See St. Joseph Valley Bank, 68 Federal Reserve Bulletin 673,674
(1982).
6. Population data are based on 1990 U.S. Census data.

884

Federal Reserve Bulletin • September 1993

supermarkets, automobile dealerships, or hospitals,
and only one physician, dentist, and pharmacist. The
more developed portion of the Denver metropolitan
area is the nearest location where these and other
services and employment opportunities are readily
available. In addition, each of these communities is a
part of the Denver, Colorado, Primary Metropolitan
Statistical Area ("Denver PMSA")7 as defined by the
United States government. A PMSA represents a core
geographic area containing a large population nucleus,
together with adjacent communities having a high
degree of economic and social integration with that
core.8 The Board also notes that these communities
are a part of the television and other media markets of
the Denver area.
In addition, commuting data indicate that a substantial portion of the labor force of these communities
travels to Denver or adjacent areas for employment.9
For example, Byers, which is the furthest of these
communities from Denver, has a local labor force of
403 persons. Of these persons, 282 were employed
outside Byers, and 234 commuted for at least a halfhour to work. The Board notes that, in view of the
presence of Interstate 70, Denver and adjacent areas
are accessible to the Byers population within this time
frame. Highway vehicle counts confirm that much of
the local labor force travels toward Denver for employment. Vehicle counts along Interstate 70 between
these communities and Denver are substantially
greater than highway vehicle counts east of Byers.10
After review of these data and the other facts of
record, the Board believes that customers in Bennett,
Strasburg, and Byers, and other eastern portions of
the Denver PMSA, practicably can turn to providers
of banking services in more urban portions of the
metropolitan area. Based on all the facts of record, the

7. Strasburg Bank and Byers Bank operate in the eastern portion of
the Denver PMSA. The Denver PMSA is comprised of Adams
County, Arapahoe County, Denver County, Douglas County, and
Jefferson County, all in Colorado. Strasburg Bank has offices in
Bennett, Colorado, and Strasburg, Colorado, and the sole office of
Byers Bank is located in Byers, Colorado. Each of these towns is
situated along a major highway, Interstate 70, between 15 and 30 miles
east of Aurora, Colorado, a Denver suburb. Interstate 70 connects
these towns to Aurora and Denver.
8. Executive Office of the President, Office of Management and
Budget, Uses of Metropolitan Areas by Federal Agencies, p. 1
(June 30, 1993). The Board notes that a PMSA, such as the Denver
PMSA, is a component part of a larger metropolitan area usually
referred to as a Consolidated Metropolitan Statistical Area.
9. Commuting data are derived from 1990 U.S. Census data, and
were obtained from the Denver Regional Council of Governments.
10. In addition, the Board notes that the more developed portions of
the Denver MSA are expanding eastward toward these communities.
In this regard, the Board notes that a major international airport is
being constructed less than 15 miles from Bennett. Both the construction and operation of this facility are expected to result in expanded
employment opportunities and greater economic integration of these
portions of the Denver PMSA.




Board has determined that the relevant geographic
market within which to evaluate the competitive effects of this proposal is the Denver, Colorado, banking
market ("Denver banking market").11
Competitive Effects in the Denver Banking Market
The Moore Chain is the 13th largest commercial banking organization in the Denver banking market, controlling deposits of $158.2 million, representing approximately 1.1 percent of total deposits in depository
institutions12 in the market ("market deposits").13
Byers Bank is the 62d largest depository institution in
the market, controlling deposits of $16.2 million, representing less than 1 percent of market deposits. Upon
consummation of this proposal, the Moore Chain
would remain the 13th largest depository institution in
the Denver banking market, controlling deposits of
$174.4 million, representing approximately 1.2 percent
of market deposits. The Herfindahl-Hirschman Index
("HHI") for the market would increase by 1 point to
831.14
Numerous depository institutions would remain in
operation in the Denver banking market upon consummation of this proposal. In addition, the Board sought
comments on the competitive effects of this proposal
from both the Department of Justice and the OCC.
Neither the Department of Justice nor the OCC objected to consummation of the proposal or indicated
that the proposal would have any significant adverse
competitive effects. On the basis of the foregoing
considerations and all the other facts of record, the
Board has concluded that consummation of the proposed bank acquisition would not result in any significantly adverse effect on competition or the concen11. The Denver banking market is approximated by the Denver
RMA; the Boulder RMA; the non-RMA portions of Adams County,
Arapahoe County, and Boulder County; the southern portion of Weld
County, including the towns of Erie, Fort Lupton, Frederick, and
Kennesburg; and the town of Parker in Douglas County.
12. In this context, depository institutions include commercial
banks, savings banks and savings associations. Market share data are
based on calculations in which the deposits of thrift institutions are
included at 50 percent. The Board previously has indicated that thrift
institutions have become, or have the potential to become, major
competitors of commercial banks. See WM Bancorp, 76 Federal
Reserve Bulletin 788 (1990); National City Corporation, 70 Federal
Reserve Bulletin 743 (1984).
13. Market deposit data are as of June 30, 1992.
14. Under the revised Department of Justice Merger Guidelines, 49
Federal Register 26,823 (1984), a market in which the post-merger
HHI is below 1000 is considered to be unconcentrated. The Justice
Department has informed the Board that, as a general matter, a bank
merger or acquisition will not be challenged (in the absence of other
factors indicating anticompetitive effects) unless the post-merger HHI
is at least 1800 and the transaction increases the HHI by more than 200
points. The Justice Department has stated that the higher than normal
HHI thresholds for screening bank mergers for anticompetitive effects
implicitly recognize the competitive effect of limited-purpose lenders
and other non-depository financial entities.

Legal Developments

tration of banking resources in the Denver banking
market or any other relevant banking market.
Convenience and Needs Considerations
The Board also has evaluated considerations relating
to the convenience and needs of the communities to be
served. In this regard, the Board has carefully considered Protestants' comments praising the convenience,
services, and other aspects of Byers Bank, and expressing concern that these positive features of Byers
Bank will be diminished if this proposal is consummated.
In response to these comments, Rice has stated that
it will retain many of the personnel currently employed
by Byers Bank. Rice also has stated that it is committed to serve its entire customer base, and has noted
that, as a branch of Strasburg Bank, the Byers operation will be able to offer significantly larger lending
limits to its consumer and business customers.
The Board also has noted that Strasburg Bank
received a "satisfactory" rating for performance under the Community Reinvestment Act (12 U.S.C.
§ 2901 et seq.) ("CRA") from the OCC at its most
recent examination conducted as of February 1993,
and that Rice has committed to implement the CRA
programs and policies of Strasburg Bank at the acquired institution in Byers.
On the basis of the foregoing considerations and all
the other facts of record, the Board has concluded that
considerations relating to the convenience and needs
of the communities to be served, including matters
relating to CRA performance, are consistent with
approval of this proposal.
Other Considerations
On the basis of all the facts of record, including all the
representations and commitments furnished in this
case, the Board also has concluded that the financial
and managerial resources and future prospects of
Rice, Strasburg Bank, and Byers Bank, as well as
affiliated organizations in the Moore Chain, and all
other supervisory factors the Board must consider
under section 3 of the BHC Act, are consistent with
approval of this proposal.
Based on the foregoing and other facts of record, the
Board has determined that the application should be,
and hereby is, approved. This approval is expressly
conditioned upon compliance with all of the commitments made in connection with this proposal and with
the conditions referenced in this Order. The commitments and conditions relied on by the Board in reaching this decision are deemed to be conditions imposed
in writing by the Board in connection with its findings



885

and decision, and, as such, may be enforced in proceedings under applicable law.
The acquisition 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
July 14, 1993.
Voting for this action: Chairman Greenspan and Governors
Mullins, Angell, Kelley, LaWare, Lindsey, and Phillips.
JENNIFER J. JOHNSON

Associate Secretary of the Board

SouthTrust Corporation
Birmingham, Alabama
Order Approving the Merger of Bank Holding
Companies
SouthTrust Corporation, Birmingham, Alabama, and
SouthTrust of Covington County, Inc., Opp, Alabama
(together, "SouthTrust"), bank holding companies
within the meaning of the Bank Holding Company Act
("BHC Act"), have applied under section 3 of the
BHC Act (12 U.S.C. § 1842) to acquire County Bancshares, Inc., Troy, Alabama ("CBI"), and thereby
acquire indirectly CBI's subsidiary bank, Pike County
Bank, Troy, Alabama.1
Notice of the application, affording interested persons an opportunity to submit comments, has been
published (58 Federal Register 28,878 (1993)). The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the factors set forth in section 3(c) of
the BHC Act.
SouthTrust, with consolidated assets of approximately $13.4 billion, controls 41 subsidiary banks in
Alabama, Florida, Georgia, North Carolina, South
Carolina, and Tennessee.2 SouthTrust is the second
largest commercial banking organization in Alabama,
controlling deposits of approximately $6.1 billion, representing 18.1 percent of total deposits in commercial
banking organizations in the state.3 CBI is the 40th
largest commercial banking organization in Alabama,

1. SouthTrust proposes to acquire CBI by merging CBI into
SouthTrust of Covington County, Inc., and subsequently merging
Pike County Bank with SouthTrust's subsidiary bank, SouthTrust
Bank, N.A., Montgomery, Alabama ("SouthTrust Bank").
2. Asset data are as of March 31, 1993.
3. Deposit data are as of June 30, 1992.

886

Federal Reserve Bulletin • September 1993

controlling deposits of $86.2 million, representing less
than 1 percent of the total deposits in commercial
banking organizations in the state. Upon consummation of the proposed transaction, SouthTrust would
remain the second largest commercial banking organization in Alabama, controlling deposits of $6.2 billion,
representing 18.4 percent of total deposits in commercial banking organizations in the state.
SouthTrust and CBI compete directly in the Pike
County banking market.4 SouthTrust is the smallest of
the six commercial banking organizations in the market, controlling deposits of approximately $15.5 million, representing 4.6 percent of total deposits in
commercial banks in the market ("market deposits").5
CBI is the second largest commercial banking organization in the market, controlling deposits of approximately $86.2 million, representing 25.9 percent of
market deposits. Upon consummation of this proposal, SouthTrust would become the second largest
commercial banking organization in the Pike County
banking market, controlling deposits of approximately
$101.6 million, representing approximately 30.5 percent of the total deposits in commercial banks in the
market. The Herfindahl-Hirschman Index ("HHI")
would increase by 240 points to 2608.6
A number of factors indicate that the increase in
concentration levels in the Pike County banking market as measured by the HHI tends to overstate the
competitive effects of this proposal. For example,
upon consummation of this proposal, five commercial
bank competitors, including the third largest bank
holding company in the state, would continue to serve
the market. The Pike County market also has experienced a decrease in concentration in recent years;
between 1989 and 1992, the market HHI for commercial banks decreased by 177 points.
The Board also notes that the Pike County banking
market is relatively attractive for entry. The economy
of Pike County is relatively diverse for a predominantly rural community. The deposit growth rate and
the deposits per banking office exceed comparable
state averages. In addition, the legal barriers to entry

4. The Pike County banking market is approximated by Pike
County, Alabama.
5. No thrift organizations operate in the Pike County banking
market.
6. Under the revised Department of Justice Merger Guidelines, 49
Federal Register 26,823 (June 29, 1984), a market in which the
post-merger HHI is above 1800 is considered highly concentrated.
The Justice Department has informed the Board that a bank merger or
acquisition generally will not be challenged (in the absence of other
factors indicating anti-competitive effects) unless the post-merger
HHI is at least 1800 and the merger increases the HHI by 200 points.
The Justice Department has stated that the higher than normal HHI
thresholds for screening bank mergers for anti-competitive effects
implicitly recognize the competitive effect of limited purpose lenders
and other non-depository financial entities.




for the market are low. Alabama permits statewide
branching, and is part of the Southeast Regional Banking Pact,7 which allows bank holding companies in
other Southeast Regional Pact states to acquire banks
in Alabama.
The Board has sought comments from the Attorney
General on the competitive effects of this proposal.
The Attorney General reviewed the competitive effects of the proposal in the context of the merger of
Pike County Bank and SouthTrust Bank under the
Bank Merger Act and has indicated that the proposal is
not likely to result in any significantly adverse competitive effects in any market.
Based on all the facts of record in this case, the
Board concludes that consummation of this proposal is
not likely to have a significantly adverse effect on
competition or concentration of banking resources in
the Pike County banking market or in any other
relevant banking market.
The Board also concludes that the financial and
managerial resources and future prospects of SouthTrust, CBI and their subsidiary banks are consistent
with approval of this proposal. Convenience and needs
considerations and the other supervisory factors that
the Board is required to consider under section 3 of the
BHC Act, also are consistent with approval.
Based on the foregoing, and other facts of the
record, and subject to the commitments made by
SouthTrust in this case, the Board has determined that
this application should be, and hereby is, approved.
The Board's approval of this proposal is specifically
conditioned on compliance with the commitments
made by SouthTrust in connection with this application and with the conditions referenced in this Order.
For purposes of this action, the commitments and
conditions relied on in reaching this decision are both
conditions imposed in writing by the Board, and, as
such, may be enforced in proceedings under applicable
law.
This transaction shall not be consummated before
the thirtieth calendar day following the effective date
of this Order, or later than three months after the
effective date of the Order, unless such period is
extended for good cause by the Board or by the
Federal Reserve Bank of Atlanta, acting pursuant to
delegated authority.
By order of the Board of Governors, effective
July 14, 1993.

7. The Alabama Regional Reciprocal Banking Act of 1986 defines
the "region" to include the states of Alabama, Arkansas, Florida,
Georgia, Kentucky, Louisiana, Maryland, Mississippi, North Carolina, South Carolina, Tennessee, Virginia, West Virginia, and the
District of Columbia. Ala. Code § 5-13A-2(10) (Supp. 1987).

Legal Developments

Voting for this action: Chairman Greenspan and Governors
Mullins, Angell, Kelley, LaWare, Lindsey, and Phillips.
JENNIFER J. JOHNSON

Associate Secretary of the Board

Orders Issued Under Section 4 of the Bank
Holding Company Act
AMCORE Financial, Inc.
Rockford, Illinois
Order Approving an Application to Act as Agent in
the Private Placement of Securities
AMCORE Financial, Inc., Rockford, Illinois ("Applicant"), a bank holding company within the meaning of
the Bank Holding Company Act ("BHC Act"), has
applied, pursuant to section 4(c)(8) of the BHC Act
(12 U.S.C. § 1843(c)(8)) and section 225.23 of the
Board's Regulation Y (12 C.F.R. 225.23), for its
wholly owned subsidiary, AMCORE Investment
Banking, Inc., Rockford, Illinois ("Company"), to act
as agent for issuers in the private placement of all
types of securities.
Notice of the application, affording interested persons an opportunity to submit comments, has been
published (58 Federal Register 13,493 (1993)). The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the public interest factors set forth in
section 4(c)(8) of the BHC Act.1
Applicant, with total consolidated assets of
$1.2 billion, is the 18th largest commercial banking
organization in Illinois.2 Applicant operates five banking subsidiaries in Illinois, and engages in a variety of
permissible nonbanking activities.
Private Placement Activities
Private placement involves the placement of new
securities with a limited number of sophisticated purchasers in a nonpublic offering. A financial intermediary in a private placement transaction acts solely as an
agent for the issuer in soliciting purchasers, and does
not purchase the securities and attempt to resell them.
Securities that are privately placed are not subject to
1. The Board received a joint comment from two organizations
maintaining that Applicant's record of lending to African-Americanowned businesses in southwest Rockford is deficient under the
Community Reinvestment Act ("CRA"). The Board previously has
determined that the CRA by its terms generally does not apply to
applications by bank holding companies to acquire nonbanking companies under section 4(c)(8) of the BHC Act. See The Mitsui Bank,
Limited, 76 Federal Reserve Bulletin 381 (1990).
2. Data are as of December 31, 1992.




887

the registration requirements of the Securities Act of
1933, and are offered only to financially sophisticated
institutions and individuals and not the public. Applicant will not privately place registered securities and
will only place securities with customers who qualify
as accredited investors.
The Board previously has determined by Order that,
subject to prudential limitations that address the potential for conflicts of interests, unsound banking
practices, or other adverse effects, the proposed private placement activities are so closely related to
banking as to be a proper incident thereto within the
meaning of section 4(c)(8) of the BHC Act. 3 The Board
also previously has determined that acting as agent in
the private placement of securities does not constitute
underwriting and dealing in securities for purposes of
section 20 of the Glass-Steagall Act, and that revenue
derived from these activities is not subject to the
10 percent revenue limitation on bank-ineligible securities underwriting and dealing.4 In order to address
the potential for conflicts of interests, unsound banking practices, and other adverse effects, Applicant has
committed that Company will conduct its private
placement activities using the same methods and procedures, and subject to the same prudential limitations
established by the Board in the Bankers Trust and J.P.
Morgan orders.5
Applicant has requested a modification of these
limitations to allow Company to have one of three
directors in common with an AMCORE subsidiary
bank.6 The prohibition against interlocks originally
was intended to preclude a member bank from engaging in impermissible securities activities, to prevent
common control of the decision-making process within
a bank and its securities affiliate, and to protect
investors against potential conflicts of interest where
one individual is required to advance the differing
objectives of a bank and its securities affiliate.
These concerns do not appear to be significant in
this application. The applicant is not seeking authority
to engage in securities underwriting or dealing activities. The Board has ruled that private placement
activities conducted directly by a bank do not constitute "underwriting" or "dealing" in securities, be-

3. See Bankers Trust New York Corporation, 75 Federal Reserve
Bulletin 829 (1989) ("Bankers Trust"); J.P. Morgan and Company,
Inc., 76 Federal Reserve Bulletin 26 (1990) ("/.P. Morgan").
4. See Bankers Trust.
5. See Bankers Trust; J.P. Morgan. Among the restrictions governing private placement activities are that Company will not privately
place registered investment company securities, and will not privately
place any securities of investment companies that are advised by
Applicant or any of its affiliates.
6. The director who will serve on the boards of both the bank and
Company also will serve as an officer of Applicant. In addition,
another director of Company will serve as an officer of Applicant.

888

Federal Reserve Bulletin • September 1993

cause these activities do not involve a "public offering" of the securities and are conducted solely as
agent.7 All the proposed activities could be performed
directly by Applicant's subsidiary banks. Consequently, in this instance a management interlock is not
prohibited by the Glass-Steagall Act. Because Company has no salesman's stake in the securities it
recommends, the potential for conflicts of interest is
substantially mitigated. Moreover, it is unlikely that
investors would confuse Company with Applicant's
subsidiary banks, because the customers of Company
will be sophisticated "institutional customers."
Under these circumstances, the Board believes that
a prohibition against director interlocks is not required
by law, and the requested director interlock between
Company and Applicant's subsidiary bank would be
appropriate.8
Financial Factors, Managerial Resources, and Other
Considerations
In every case involving a nonbanking acquisition by a
bank holding company under section 4 of the BHC
Act, the Board considers the financial condition and
resources of Applicant and its subsidiaries and the
effect of the transaction on these resources.9 Based on
the facts of this case, the Board concludes that financial considerations are consistent with approval of this
application. The managerial resources of Applicant
also are consistent with approval.
In order to approve this application, the Board is
required to determine that the performance of the
proposed activities by Applicant can reasonably be
expected to produce public benefits that outweigh
adverse effects under the proper incident to banking
standard of section (4)(c)(8) of the BHC Act. Under
the framework established in this Order and prior
decisions, consummation of this proposal is not likely
to result in any significant adverse effects, such as
undue concentration of resources, decreased or unfair
competition, conflicts of interests, or unsound banking
practices. In addition, the Board expects that the
de novo entry of Company into the market for these
services would increase the level of competition
among providers of these services. Accordingly, the
Board has determined that the performance of the
proposed activities by Company can reasonably be

7. Statement Concerning Applicability of the Glass-Steagall Act to
the Commercial Paper Placement Activities of Bankers Trust Company (June 4, 1985), affd sub nom. Securities Industry Association v.
Board of Governors, 807 F.2d 1052 (D.C. Cir. 1986), cert, denied, 483
U.S. 1005 (1987).
8. See First Eastern Corporation, 76 Federal Reserve Bulletin 764
(1990).
9. See 12 C.F.R. 225.24.




expected to produce public benefits that would outweigh possible adverse effects under the proper incident to banking standard of section (c)(8) of the BHC
Act.
Based on the foregoing and all the facts of record,
the Board has determined to, and hereby does, approve the application subject to all the commitments
made by Applicant in connection with this application,
and the terms and conditions set forth in this Order,
and in the above-noted Board orders. The Board's
determination also is subject to all the terms and
conditions set forth in Regulation Y, including those in
sections 225.4(d) and 225.23(b), and to the Board's
authority to require modification or termination of the
activities of a bank holding company or any of its
subsidiaries as the Board finds necessary to assure
compliance with, and to prevent evasion of, the provisions of the BHC Act, and the Board's regulations
and orders issued thereunder. The Board's decision
specifically is conditioned on compliance with all the
commitments made in connection with this application, including the commitments discussed in this
Order and the conditions set forth in the above-noted
Board regulations and orders. These commitments and
conditions are deemed to be conditions imposed in
writing by the Board in connection with its findings
and decision, and may be enforced in proceedings
under applicable law.
This transaction shall not be consummated 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
July 2, 1993.
Voting for this action: Chairman Greenspan and Governors
Angell, Kelley, Lindsey, and Phillips. Absent and not voting:
Governors Mullins and LaWare.
JENNIFER J. JOHNSON

Associate Secretary of the Board

Continental Bank Corporation
Chicago, Illinois
Order Approving Application to Engage De Novo in
Asset Management, Servicing, and Collection
Activities
Continental Bank Corporation, Chicago, Illinois
("Continental"), a bank holding company within the
meaning of the Bank Holding Company Act ("BHC
Act"), has applied under section 4(c)(8) of the BHC
Act (12 U.S.C. § 1843(c)(8)) and section 225.23(a)(3)

Legal Developments

of the Board's Regulation Y (12 C.F.R. 225.23(a)(3)),
to engage de novo in asset management, servicing, and
collection activities through its wholly owned subsidiary Repechage Partners Ltd., Chicago, Illinois ("Repechage").
Notice of the application, affording interested persons an opportunity to submit comments, has been
published (58 Federal Register 34,436 (1993)). The
time for filing comments has expired, and the Board
has considered the application and all comments received in light of the factors set forth in section 4(c)(8)
of the BHC Act.
Continental, with total consolidated assets of approximately $22 billion, is the second largest banking
organization in Illinois.1 Continental operates one subsidiary bank and engages directly and through subsidiaries in a variety of nonbanking activities.
Repechage would provide asset management services to the Resolution Trust Corporation ("RTC")
and the Federal Deposit Insurance Corporation
("FDIC").2 In addition, Repechage proposes to provide these services to unaffiliated third party investors
that purchase pools of assets assembled by the RTC or
the FDIC from troubled financial institutions, and
generally to unaffiliated financial and non-financial
institutions with troubled assets. Under the proposal,
neither Continental nor Repechage would directly or
indirectly acquire an ownership interest in the assets
that they manage or in the institutions for which they
provide asset management services. In addition, Repechage would not engage in providing real property
management or real estate brokerage services as part
of its proposed activities.3
The Board has previously determined that, within
certain parameters, providing asset management ser-

1. Data are as of March 31, 1993.
2. Asset management encompasses the liquidation (or other disposition) of loans and their underlying collateral, including real estate
and other assets acquired through foreclosure or in satisfaction of
debts previously contracted ("DPC property"). Specific individual
activities include: classifying and valuing loan portfolios; filing reviews of loan documentation; developing collection strategies; negotiating renewals, extensions, and restructuring agreements; initiating
foreclosure, bankruptcy, and other legal proceedings, where appropriate; and developing and implementing market strategies for the sale
or refinancing of individual loans and for the packaging and sale of
whole or securitized loan portfolios. In addition, Continental would
conduct and review (either directly or through independent contractors) appraisals and environmental inspections; provide asset valuations; perform cash-flow and asset-review analyses; contract with and
supervise independent property managers; and lease (either directly
or through independent contractors) real estate and other DPC property. Continental also would dispose of DPC property by developing
and implementing marketing strategies for the sale of DPC property,
either individually or packaged for investors or developers.
3. Continental will contract with independent third parties to obtain
these services for assets under the management of Repechage.




889

vices for assets originated by financial institutions4 and
their bank holding company affiliates is an activity that
is closely related to banking for purposes of the BHC
Act.5 Continental proposes to conduct all asset management activities under the same terms, and subject
to the same conditions as in previous Board orders
regarding this activity.6 For example, Continental has
committed that it will not own the stock of, or be
represented on the board of directors of, any unaffiliated institution for which Repechage provides asset
management services or own the assets under management. In addition, Continental has committed that
Repechage will not establish policies or procedures of
general applicability for the institutions whose assets it
manages, and that the services of Repechage for
unaffiliated institutions would be limited to asset management, servicing, and collection activities.7
Continental proposes to engage in asset management activities for assets originated by non-financial
institutions as well as financial institutions.8 These
assets, however, would be limited to the types of
assets that a financial institution would have the authority to originate.9 Accordingly, the Board believes
that Continental would have the expertise to engage in
the management of these types of assets, regardless of
the originating entity, and that the proposal is within
the scope of the asset management approval in the
Board's prior orders.10 For these reasons, the Board
concludes that Continental's proposed activities are
closely related to banking.

4. Financial institutions include banks, savings associations, and
credit unions.
5. See First Interstate Bancorp, 77 Federal Reserve Bulletin 334
(1991); Banc One Corporation, 77 Federal Reserve Bulletin 331 (1991);
NCNB Corporation, 77 Federal Reserve Bulletin 124 (1991); First
Florida Banks, Inc., 74 Federal Reserve Bulletin 111 (1988).
6. Id.
7. Continental also would provide these services for a limited period
of time. The Board notes that, while Continental would manage the
assets on an ongoing basis, the owner of the assets would retain the
right to make all final decisions regarding asset dispositions and to
terminate Continental as asset manager.
8. These assets include: real estate; commercial, consumer and
other loans; equipment leases; and extensions of credit. Non-financial
institutions include pension funds, leasing companies, finance companies, and investment companies formed to engage in asset management activities.
9. These assets would include: equipment leases that conform to
section 225.25(b)(5) of the Board's Regulation Y (12 C.F.R.
225.25(b)(5)); loans secured by equipment and equipment acquired
through foreclosure or in satisfaction of such leases and loans;
consumer loans financing manufactured housing, vessels, vehicles,
and residences; asset-based commercial loans; factored accounts
receivables; and collateral for the aforementioned types of loans
acquired through foreclosure or in satisfaction of such loans. Prior
approval of the Board would be required before providing asset
management services in connection with pools of assets of the type
impermissible for a financial institution to originate.
10. See, e.g., The Dai-Ichi Kangyo Bank, Ltd., 79 Federal Reserve
Bulletin 131 (1993).

890

Federal Reserve Bulletin • September 1993

The Board is also required to determine whether the
performance of the proposed activity by Continental is
a proper incident to banking—that is, whether the
proposed activity "can reasonably be expected to
produce benefits, such as greater convenience, increased competition, or gains in efficiency, that outweigh possible adverse effects, such as undue concentration of resources, decreased or unfair competition
conflicts of interests, or unsound banking practices."
12 U.S.C. § 1843(c)(8).
Consummation of the proposal can reasonably be
expected to result in public benefits. Continental's
proposal would facilitate the disposal of assets of
financial institutions in receivership as well as financial
and non-financial institutions with troubled financial
assets. Moreover, the efficient disposition of such
assets can reasonably be expected to produce benefits
to the public. Repechage would own no equity in the
institutions for which it provides asset management
services or in the assets it manages. Continental's
de novo entry into the market would increase competition for these services.
Continental has indicated that it may, in certain
instances, seek approval to acquire institutions whose
assets are being managed by Repechage. In previous
cases, the Board has expressed concern that a bank
holding company might obtain confidential information in providing its asset management services that
would give the bank holding company a competitive
advantage over other institutions in the bidding process for the failed institution under management.11 The
Board also noted that such information could give the
managing bank holding company a competitive advantage over the ultimate acquiror of the failed institution
in markets where they both compete.
To address these concerns, Continental has committed to establish and implement procedures to preserve
the confidentiality of information obtained in the
course of providing asset management services.12
These procedures would prevent the use of information obtained by Repechage through its asset management activities in preparing any bid that Continental
may prepare to acquire an institution managed by
Repechage, and would prevent Continental from competing unfairly against the winning bidder.
There is no evidence in the record to indicate that
consummation of this proposal is likely to result in any
significantly adverse effects, such as undue concentration of resources, decreased or unfair competition,
conflicts of interests, or unsound banking practices.

11. See, e.g., NCNB Corporation, 77 Federal Reserve Bulletin 124
(1991).
12. Continental's procedures will be subject to review by the
Federal Reserve System.




The financial and managerial resources of Continental
and its subsidiaries are also consistent with approval.
Accordingly, on the basis of all the facts of record and
commitments made by Continental, the Board concludes that the public benefits that would result from
approval of this application outweighs the potential
adverse effects, and that the public interest factors it
must consider under section 4(c)(8) of the BHC Act
are consistent with approval.
Based upon the foregoing and all the other facts of
record, including commitments made by Continental
and conditions in this order, the Board has determined
that this application should be, and hereby is, approved. The Board's approval is expressly conditioned upon compliance with all the commitments
made by Continental in connection with this application and the conditions referred to in this order and the
orders mentioned above. For the purpose of this
action, these commitments and conditions will both be
considered conditions imposed in writing and, as such,
may be enforced in proceedings under applicable law.
The Board's determination is also 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 modification or
termination of the activities of a bank holding company or any of its subsidiaries as the Board finds
necessary to assure compliance with, and to prevent
evasion of, the provisions of the BHC Act and the
Board's regulations and orders issued thereunder.
This transaction shall not be consummated later
than three months after the effective date of this
Order, unless such period is extended for good cause
by the Board or by the Federal Reserve Bank of
Chicago, acting pursuant to delegated authority.
By order of the Board of Governors, effective
July 26, 1993.
Voting for this action: Chairman Greenspan and Governors
Mullins, Angell, Kelley, LaWare, and Lindsey. Absent and
not voting: Governor Phillips.
JENNIFER J. JOHNSON

Associate Secretary of the Board

National Commerce Bancorporation
Memphis, Tennessee
Order Approving the Acquisition of a Savings
Association and the Sale of Credit-Related
Insurance
National Commerce Bancorporation, Memphis, Tennessee ("NCB"), a bank holding company within the
meaning of the Bank Holding Company Act ("BHC

Legal Developments

891

This activity is permissible for bank holding companies under the Board's Regulation Y, and NCB proposes to conduct these activities in accordance with
the Board's regulations. 12 C.F.R. 225.25(b)(8)(i).
Notice of the applications, affording interested persons an opportunity to submit comments, has been
published (58 Federal Register 30,789 (1993)). The
time for filing comments has expired, and the Board
has considered the applications and all comments
received in light of the public interest factors set forth
in section 4(c)(8) of the BHC Act.
The Board has determined that the operation of a
savings association is closely related to banking and
permissible for bank holding companies. 12 C.F.R.
225.25(b)(9). In making this determination, the Board
required that savings associations acquired by bank
holding companies conform their direct and indirect
activities to those permissible for bank holding companies under section 4 of the BHC Act. 2 As noted
above, the proposed insurance activities are related to
extensions of credit and are permissible activities
under the Board's regulations.
Following the acquisition of FFSB, NCB proposes
to establish branches of FFSB in Roanoke, Virginia,
and in other states. Neither the BHC Act nor the
Board's regulations currently restrict the ability of a
savings association owned by a bank holding company
to establish interstate branches. The regulations
adopted by the Office of Thrift Supervision ("OTS")

permit federally chartered savings associations to operate interstate branches, under certain circumstances, with the approval of the OTS.3 The Board's
action in this matter is conditioned upon compliance
by FFSB with all applicable laws governing its activities and branching, including all applicable OTS regulations.
In considering an application under section 4(c)(8) of
the BHC Act, the Board is required to determine that
the applicant's ownership and operation of the acquired company "can reasonably be expected to produce benefits to the public, such as greater convenience, increased competition, or gains in efficiency,
that outweigh possible adverse effects, such as undue
concentration of resources, decreased or unfair competition, conflicts of interests, or unsound banking
practices." 12 U.S.C. § 1843(c)(8).
NCB, with total consolidated assets of approximately $2.3 billion, controls three banks in Tennessee. 4 NCB is the seventh largest banking organization
in Tennessee, controlling deposits of $1.7 billion,
representing 3.9 percent of total deposits in commercial banking organizations in the state.5 FFSB is the
21st largest thrift organization in Mississippi, controlling deposits of $4.3 million, representing less than
1 percent of total deposits in thrift institutions in the
state.6
The banking subsidiaries of NCB and FFSB do not
compete in any of the same banking markets. Accordingly, the Board concludes that this proposal would
not have a significantly adverse effect on competition
in any relevant banking market. The financial and
managerial resources of NCB, its subsidiaries, and
FFSB also are consistent with approval.
In light of the facts of record, the Board concludes
that NCB's proposal would not significantly affect
competition in any relevant market. Furthermore,
there is no evidence in the record to indicate that
consummation of this proposal is likely to result in any
significantly adverse effects, such as undue concentration of resources, decreased or unfair competition,
conflicts of interests, or unsound banking practice.
Accordingly, the Board has determined that the balance of public interest factors it must consider under
section 4(c)(8) of the BHC Act is favorable and consistent with approval of NCB's application to engage
in this activity.

1. "Extension of credit" includes direct loans to borrowers, loans
purchased from other lenders, and leases of real or personal property
so long as the leases are nonoperating and full payout leases that meet
the requirements of section 225.25(b)(5) of the Board's Regulation Y
(12 C.F.R. 225.25(b)(5)).
2. In this regard, NCB has committed that FFSB will not engage in
any activity not permitted for bank holding companies and their
subsidiaries under section 4(c)(8) of the BHC Act.

3. Board approval also may be required in certain circumstances
under the provisions of section 225.23 of the Board's Regulation Y
(12 C.F.R. 225.23).
4. Asset data are as of March 31, 1993.
5. State commercial bank deposit data are as of June 30, 1992.
6. State thrift deposit data are as of June 30, 1992.

Act"), has applied pursuant to section 4(c)(8) of the
BHC Act (12 U.S.C. § 1843(c)(8)) and section 225.23
of the Board's Regulation Y (12 C.F.R. 225.23) to
acquire First Federal Savings Bank, Belzoni, Mississippi ("FFSB"). FFSB would be owned by NCB in
accordance with section 225.25(b)(9) of the Board's
Regulation Y (12 C.F.R. 225.25(b)(9)). NCB also has
applied, pursuant to section 4(c)(8) of the BHC Act, to
sell, indirectly through FFSB, credit insurance as
principal, agent or broker (including home mortgage
redemption insurance) that is:
(A) Directly related to an extension of credit by
NCB or any of its subsidiaries; and
(B) Limited to assuring the repayment of the
outstanding balance due on the extension of credit1 in the event of the death, disability, or involuntary unemployment of the debtor.




892

Federal Reserve Bulletin • September 1993

Based on the foregoing, the Board has determined
that the application should be, and hereby is, approved. The Board's approval is specifically conditioned on compliance by NCB with all of the commitments and conditions made in connection with this
application. This determination also is subject to all of
the conditions contained in the Board's Regulation Y,
including those in sections 225.4(d) and 225.23(b)(3)
(12 C.F.R. 225.4(d) and 225.23(b)(3)), 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 it finds necessary to
assure compliance with, or prevent evasions of, the
provisions and purposes of the BHC Act and the
Board's regulations and orders issued thereunder. All
the commitments and conditions relied on in reaching
this decision in this case are deemed to be conditions
imposed in writing by the Board in connection with its
findings and decision, and as such may be enforced in
proceedings under applicable law.
The transaction shall not be consummated later than
three months after the effective date of this Order,
unless such period is extended for good cause by the
Board or by the Federal Reserve Bank of St. Louis,
acting pursuant to delegated authority.
By order of the Board of Governors, effective
July 12, 1993.
Voting for this action: Vice Chairman Mullins and Governors Angell, Kelley, LaWare, Lindsey, and Phillips. Absent
and not voting: Chairman Greenspan.
JENNIFER J. JOHNSON

Associate Secretary of the Board

NationsBank Corporation
Charlotte, North Carolina
Order Approving Application to Engage De Novo in
Underwriting and Dealing in All Types of Debt and
Equity Securities on a Limited Basis, and Certain
Foreign Exchange-Related Activities
NationsBank Corporation, Charlotte, North Carolina
("NationsBank"), a bank holding company within the
meaning of the Bank Holding Company Act ("BHC
Act"), has applied under section 4(c)(8) of the BHC
Act (12 U.S.C. 1843(c)(8)) and section 225.23(a) of
the Board's Regulation Y (12 C.F.R. 225.23(a)) to
engage de novo through its wholly owned subsidiary,
NationsBanc Capital Markets, Inc., Charlotte, North
Carolina ("Company"), in the following nonbanking
activities:
(1) Underwriting and dealing in, to a limited extent,
all types of debt and equity securities (other than



securities issued by open-end investment companies), including without limitation sovereign debt
securities, corporate debt securities, debt securities
convertible into equity securities, debt securities
issued by a trust or other vehicle secured by or
representing interests in debt obligations, preferred
stock, common stock, American Depositary Receipts, and other direct and indirect equity ownership interests in corporations and other entities; and
(2) Providing foreign exchange advisory and transactional services while also taking positions in foreign exchange, for hedging purposes only, for its
own account.
NationsBank proposes to conduct these activities
throughout the United States.
Notice of the application, affording interested persons an opportunity to submit comments on the proposal, has been published (58 Federal Register 33,273
(1993)). The time for filing comments has expired, and
the Board has considered the application and all
comments received in light of the factors set forth in
section 4(c)(8) of the BHC Act.
NationsBank, with total consolidated assets of
$122 billion, is the fifth largest commercial banking
organization in the United States, and operates bank
subsidiaries in North Carolina, Texas, Georgia, Virginia, Maryland, the District of Columbia, Tennessee,
Kentucky, Florida, South Carolina, and Delaware.1
Company currently is engaged in limited bank-ineligible
securities underwriting and dealing activities that are
permissible under section 20 of the Glass-Steagall Act
(12 U.S.C. § 377).2 Company is, and will continue to
be, a broker-dealer registered with the Securities and
Exchange Commission ("SEC") and a member of the
National Association of Securities Dealers, Inc.
("NASD"). Accordingly, Company is subject to the
record-keeping, reporting, fiduciary standards, and
other requirements of the Securities Exchange Act of
1934 (15 U.S.C. § 78a et seq.), the SEC, and the
NASD. 3
1. Asset data are as of March 31, 1993.
2. In particular, Company has authority to underwrite and deal in,
to a limited extent, certain municipal revenue bonds, 1-4 family
mortgage-backed securities, commercial paper, and consumer receivable-related securities (together with the types of securities which
Company now seeks authority to underwrite and deal in, collectively,
"bank-ineligible securities").
3. Company currently has authority to conduct a variety of securities-related activities, including:
(1) Underwriting and dealing in securities that state member banks
are authorized to underwrite and deal in under sections 5(c) and 16
of the Glass-Steagall Act (12 U.S.C. §§ 335 and 24(7)), pursuant to
section 225.25(b)(16) of Regulation Y (12 C.F.R. 225.25(b)(16));
(2) Providing securities brokerage and investment advisory services, on both a separate and combined basis, pursuant to sections
225.25(b)(4) and (b)(15) of Regulation Y (12 C.F.R. 225.25(b)(4) and
(b)(15));

Legal Developments

Underwriting and Dealing Activities
The Board has determined that, subject to the prudential framework of limitations established in previous
decisions to address the potential for conflicts of
interests, unsound banking practices, or other adverse
effects, the proposed underwriting and dealing activities involving bank-ineligible securities are so closely
related to banking as to be proper incidents thereto
within the meaning of section 4(c)(8) of the BHC Act. 4
NationsBank has committed that Company will conduct the proposed underwriting and dealing activities
using the same methods and procedures, and subject
to the same prudential limitations, as were established
by the Board in the Section 20 Orders. The Board also
has determined that the conduct of these securities
underwriting and dealing activities is consistent with
section 20 of the Glass-Steagall Act (12 U.S.C. § 377),
provided that the company engaged in the underwriting and dealing activities derives no more than 10
percent of its total gross revenue from underwriting
and dealing in bank-ineligible securities over any twoyear period.5 NationsBank has committed that Company will conduct its underwriting and dealing activities with respect to bank-ineligible securities subject to
this 10 percent revenue test.6

(3) Acting as agent in the private placement of all types of securities,
and providing related advisory services; and
(4) Buying and selling all types of securities on customer order as a
"riskless principal".
See NCNB Corporation, 76 Federal Reserve Bulletin 864 (1990);
NCNB Corporation, 75 Federal Reserve Bulletin 520 (1989). See also
NCNB Corporation, 78 Federal Reserve Bulletin 141,158 n. 86 (1991),
and NCNB Corporation, 78 Federal Reserve Bulletin 92,93-94 (1991).
4. See Canadian Imperial Bank of Commerce, et al., 76 Federal
Reserve Bulletin 158 (1990); J.P. Morgan & Co. Incorporated, et al.,
75 Federal Reserve Bulletin 192 (1989), affd sub nom. Securities
Industries Ass'n v. Board of Governors of the Federal Reserve
System, 900 F.2d 360 (D.C. Cir. 1990); Citicorp, et al., 73 Federal
Reserve Bulletin 473 (1987), affd sub nom. Securities Industry Ass'n
v. Board of Governors of the Federal Reserve System, 839 F.2d 47 (2d
Cir. 1988), cert, den., 486 U.S. 1059 (1988) (collectively, "Section 20
Orders").
5. See id. Compliance with the 10 percent revenue limitation shall be
calculated in accordance with the method stated in the Section 20
Orders, as modified by the Order Approving Modifications to the
Section 20 Orders, 75 Federal Reserve Bulletin 751 (1989), the Order
Approving Modifications to the Section 20 Orders, 79 Federal Reserve
Bulletin 226 (1993), and the Supplement to Order Approving Modifications to Section 20 Orders, 79 Federal Reserve Bulletin 360 (1993)
(collectively, "Modification Orders"). In this regard, the Board notes
that NationsBank has not adopted the Board's alternative indexed
revenue test to measure compliance with the 10 percent limitation on
bank-ineligible securities activities, and, absent such election, will
continue to employ the Board's original 10 percent revenue standard.
6. NationsBank also has proposed that Company engage in certain
other activities in connection with the proposed underwriting and
dealing activities, including certain securities clearing and investment
advisory activities. NationsBank maintains that these additional activities are incidental to the proposed underwriting and dealing activities. In this regard, the Board notes that Company may provide
services that are necessary incidents to the proposed underwriting and
dealing activities, provided that any activities conducted as a neces-




893

The Board has reviewed the capitalization of NationsBank and Company in accordance with the standards set forth in the Section 20 Orders, and finds the
capitalization of each to be consistent with approval.
With respect to the capitalization of Company, this
determination is based upon all the facts of record,
including NationsBank's projections with respect to
the volume of Company's underwriting and dealing
activities in bank-ineligible securities. The Federal
Reserve Bank of Richmond has reviewed the operational and managerial infrastructure of Company, including its computer, audit, and accounting systems,
and internal risk management procedures and controls. The Reserve Bank has determined that Company has established an operational and managerial
infrastructure for underwriting and dealing in all types
of debt securities that is adequate to ensure compliance with the requirements of the Section 20 Orders.
On the basis of the Reserve Bank's review and all the
facts of record, the Board has determined that Company has in place, with respect to its proposal to
underwrite and deal in all types of debt securities, the
managerial and operational infrastructure and other
policies and procedures necessary to comply with the
requirements of the Section 20 Orders and this order.
Accordingly, the Board concludes that financial and
managerial considerations are consistent with approval of the proposal for Company to underwrite and
deal in all types of debt securities on a limited basis.
With respect to the proposed underwriting and
dealing activities involving equity securities, NationsBank has informed the Board that it does not intend
that Company engage in these activities in the first
year after approval of this proposal. Accordingly, and
in light of all the facts of record, the Board's approval
of NationsBank's proposal that Company engage in
these activities is conditioned upon a satisfactory
determination that Company's operational and managerial infrastructure and policies and procedures relating to underwriting and dealing in equity securities are
adequate to ensure compliance with the requirements
of the Section 20 Orders following a second review by
the Reserve Bank.
In order to approve this proposal, the Board also
must determine that the performance of the proposed
underwriting and dealing activities by Company can
reasonably be expected to produce public benefits that

sary incident to the bank-ineligible securities activities must be treated
as part of the bank-ineligible securities activities unless Company has
received specific approval under section 4(c)(8) of the BHC Act to
conduct the activities independently. Until such approval is obtained,
any revenues from the incidental activities must be counted as
ineligible revenues subject to the 10 percent revenue limitation set
forth in the Section 20 Orders, as modified by the Modification Orders.

894

Federal Reserve Bulletin • September 1993

would outweigh possible adverse effects under the
proper incident to banking standard of section 4(c)(8)
of the BHC Act. Under the framework and conditions established in this and prior decisions, consummation of this proposal is not likely to result in any
significant adverse effects, such as undue concentration of resources, decreased or unfair competition,
conflicts of interests, or unsound banking practices.
Moreover, the Board expects that the de novo entry
of Company into the market for the proposed services in the United States would provide added
convenience to NationsBank's customers, and would
increase the level of competition among existing
providers of these services. Accordingly, the Board
has determined that the performance of the proposed
activities by NationsBank can reasonably be expected to produce public benefits that will outweigh
possible adverse effects under the proper incident to
banking standard of section 4(c)(8) of the BHC Act.
Accordingly, and for the reasons set forth in the
Section 20 Orders, the Board concludes that NationsBank's proposal to engage through Company in the
proposed underwriting and dealing activities is consistent with the Glass-Steagall Act, and is so closely
related to banking as to be a proper incident thereto
within the meaning of section 4(c)(8) of the BHC Act,
provided that NationsBank limits Company's activities as specified in this order and the Section 20
Orders, as modified by the Modification Orders.
Foreign Exchange-Related Activities
The Board previously has determined by regulation
that the provision of foreign exchange advisory and
transactional services is an activity so closely related
to banking as to be a proper incident thereto within
the meaning of the BHC Act, provided that the
activity is conducted through a separately incorporated subsidiary of the bank holding company which,
inter alia, does not take positions in foreign exchange
for its own account. See 12 C.F.R. 225.25(b)(17).
Company will conduct the proposed foreign exchange advisory and transactional services in accordance with the limitations set forth in Regulation Y,
except that Company will take positions in foreign
exchange for its own account for purposes of hedging
its proposed underwriting and dealing activities.
Bank holding companies have been authorized to
take positions in foreign exchange for hedging purposes, 7 and the Board has previously noted that in

7. See, e.g., The Nippon Credit Bank, Ltd., 75 Federal Reserve
Bulletin 308 (1989). See also 12 C.F.R. 225.142.




conducting foreign exchange operations, commercial
banks do combine the functions of giving advice,
executing transactions, and taking positions in foreign exchange.8 Accordingly, the Board concludes
that NationsBank's proposal to conduct foreign exchange advisory and transactional activities in a
nonbanking subsidiary which also takes positions in
foreign exchange for hedging purposes only is closely
related to banking within the meaning of the BHC
Act.
In regard to the proper incident to banking standard of section 4(c)(8) of the BHC Act, the limitation
in Regulation Y on taking positions in foreign exchange in combination with providing foreign exchange advisory and transactional services is based
upon the potential conflict of interest involved in
conducting these activities on a combined basis. 9 In
order to address the potential for conflicts of interest
which could arise from the combined conduct of
these activities in one nonbanking subsidiary, NationsBank has committed that Company's personnel
engaged in trading foreign exchange for hedging
purposes will not have access to information about
the foreign exchange activities of customer representatives. Similarly, Company's customer representatives will not have access to information about the
foreign exchange activities of its hedging traders.
The Board also notes that Company will only take
foreign exchange positions for purposes of hedging
its proposed underwriting and dealing activities. On
the basis of these and other commitments furnished
by NationsBank and all the other facts of record, the
Board believes that Company's conduct of the proposed foreign exchange-related activities is not likely
to result in any significant adverse effects, such as
undue concentration of resources, decreased or unfair competition, conflicts of interests, or unsound
banking practices.10 Moreover, the Board expects
that the de novo entry of Company into the market
for the proposed services in the United States would
provide added convenience to NationsBank's customers, and would increase the level of competition
among existing providers of these services. Accordingly, the Board has determined that the performance

8. See Hongkong and Shanghai Banking Corporation, et al.,
69 Federal Reserve Bulletin 221, 223 (1983).
9. See The Nippon Credit Bank, Ltd., supra, at 310; Hongkong and
Shanghai Banking Corporation, et al., supra, at 223.
10. The Board notes that it previously has approved proposals for a
nonbanking subsidiary to take positions in foreign exchange while also
providing general information, statistical forecasting, and limited
general advice regarding foreign exchange. See The Long-Term Credit
Bank of Japan, Limited, 79 Federal Reserve Bulletin 347, 349 (1993);
The Bank of Tokyo, Ltd., 76 Federal Reserve Bulletin 654, 656-657
(1990).

Legal Developments

of the proposed activities by NationsBank can reasonably be expected to produce public benefits that
will outweigh possible adverse effects under the
proper incident to banking standard of section 4(c)(8)
of the BHC Act.
On the basis of the foregoing and all the facts of
record, including the commitments furnished by NationsBank, the Board has determined that the application should be, and hereby is, approved, subject to all
the terms and conditions of this order and the Section
20 Orders, as modified by the Modification Orders. The
Board's approval of this proposal extends only to
activities conducted within the limitations of those
Orders and this order, including the Board's reservation of authority to establish additional limitations to
ensure that Company's activities are consistent with
safety and soundness, conflicts of interests, and other
relevant considerations under the BHC Act. Underwriting and dealing in any manner other than as approved in the Section 20 Orders is not within the scope
of the Board's approval and is not authorized for
Company.
The Board's determination also is subject to all the
terms and conditions set forth in Regulation Y,
including those in sections 225.4(d) and 225.23(b) of
Regulation Y, and to the Board's authority to require
such modification or termination of the activities of a
bank holding company or any of its subsidiaries as
the Board finds necessary to ensure compliance with,
and to prevent evasion of, the provisions of the BHC
Act and the Board's regulations and orders issued
thereunder. The Board's decision is specifically conditioned on compliance with all the commitments
made in connection with this application, including
the commitments discussed in this Order, and the
conditions set forth in the above-noted Board regulations and orders. These commitments and conditions are deemed to be conditions imposed in writing
by the Board in connection with its findings and
decision, and, as such, may be enforced in proceedings under applicable law.
This transaction shall not be consummated later
than three months after the effective date of this
Order, unless such period is extended for good cause
by the Board or by the Federal Reserve Bank of
Richmond, acting pursuant to delegated authority.
By order of the Board of Governors, effective
July 26, 1993.
Voting for this action: Chairman Greenspan and Governors
Mullins, Angell, Kelley, LaWare, and Lindsey. Absent and
not voting: Governor Phillips.
JENNIFER J. JOHNSON

Associate Secretary of the Board




895

Orders Issued Under Sections 3 and 4 of the
Bank Holding Company Act
Meridian Bancorp, Inc.
Reading, Pennsylvania
Order Approving Acquisition of a Bank Holding
Company
Meridian Bancorp, Inc., Reading, Pennsylvania ("Meridian"), a bank holding company within the meaning
of the Bank Holding Company Act ("BHC Act"), has
applied for the Board's approval under section 3 of the
BHC Act (12 U.S.C. § 1842) to acquire all of the
voting shares of Commonwealth Bancshares Corporation ("Commonwealth"), and thereby to acquire indirectly Commonwealth's subsidiary bank, Commonwealth Bank ("Commonwealth Bank"), both of
Williamsport, Pennsylvania.1 Meridian's wholly
owned subsidiary state member bank, Meridian Bank,
Reading, Pennsylvania ("Meridian Bank"), also has
applied for the Board's approval under section 18(c) of
the Federal Deposit Insurance Act (the "Bank Merger
Act") to merge with Commonwealth Bank, and, under
sections 9 and 24A of the Federal Reserve Act, to
establish additional branches and invest in bank premises. 2
Meridian also has applied under section 4(c)(8) of
the BHC Act (12 U.S.C. § 1843(c)(8)) to acquire
Susquehanna Life Insurance Company, Phoenix, Arizona ("Susquehanna Life"), and thereby engage in the
sale of credit-related insurance pursuant to 12 C.F.R.
225.25(b)(8)(i), and Commonwealth Bancshares Community Development Corporation, Williamsport,
Pennsylvania ("Commonwealth CDC"), and thereby
engage in community development activities pursuant
to 12 C.F.R. 225.25(b)(6).
Notice of the applications, affording interested persons an opportunity to submit comments, has been
published (58 Federal Register 28,878 (1993)). The
time for filing comments has expired, and the Board
has considered these applications and all comments
received in light of the factors set forth in section 3(c)
of the BHC Act, the Bank Merger Act, and the Federal
Reserve Act. As required by the Bank Merger Act,
reports on the competitive effects of the merger were
requested from the United States Attorney General,

1. In connection with Meridian's proposed acquisition of Commonwealth, Meridian also has requested Board approval under section 3 of
the BHC Act to acquire an option to purchase up to 19.9 percent of the
voting shares of Commonwealth. This option will become moot upon
consummation of Meridian's application to acquire Commonwealth.
2. Meridian will establish branches at each of the locations set forth
in the Appendix.

896

Federal Reserve Bulletin • September 1993

the Office of the Comptroller of the Currency, and the
Federal Deposit Insurance Corporation.
Meridian, with $12 billion in consolidated assets,
controls subsidiary banks located in Pennsylvania,
Delaware, and New Jersey.3 Meridian controls deposits of $9 billion in Pennsylvania and is the fifth largest
commercial banking organization in that state. Commonwealth, with deposits of $1.6 billion, is the fourteenth largest commercial banking organization in
Pennsylvania.4 Upon consummation of the transaction, Meridian would become the fourth largest commercial banking organization in Pennsylvania, controlling deposits of approximately $10.6 billion in the
state, representing 8.1 percent of deposits in commercial banks in Pennsylvania. Meridian and Commonwealth do not compete directly in any banking market.
Based on all the facts of record, the Board has
concluded that consummation of the proposal would
not have a significantly adverse effect on competition
in any relevant banking market.
The Board also concludes that the financial and
managerial resources and future prospects of Meridian
and Commonwealth, and their subsidiary banks, the
convenience and needs of the communities to be
served, and the other factors that the Board must
consider under section 3 of the BHC Act and the Bank
Merger Act, are consistent with approval.5 Meridian
Bank also has applied under sections 9 and 24A of the
Federal Reserve Act to establish branches and invest
in branch premises. The Board has considered the
factors it is required to consider when reviewing
applications pursuant to these sections of the Federal
Reserve Act and finds those factors to be consistent
with approval.
Meridian also has applied, pursuant to section
4(c)(8) of the BHC Act, to acquire Susquehanna Life,
a company that provides credit-related life and disability insurance issued in connection with extensions of
credit by Commonwealth, and Commonwealth CDC, a
company that makes equity and debt investments in

3. Asset and deposit data are as of June 30, 1992.
4. These data include deposits of Valley Community Bank,
Kingston, Pennsylvania, which Commonwealth has received approval
to acquire.
5. The Board has received a comment from a former customer of
Commonwealth Bank alleging improper alterations of a mortgage that
is the subject of a foreclosure proceeding by the bank. The Board has
carefully considered these comments in light of all facts of record,
including relevant reports of examination by Commonwealth Bank's
primary federal regulator, the Federal Reserve Bank of Philadelphia,
and Commonwealth Bank's loan documentation policies, which Meridian states are consistent with the policies to be established upon
consummation of this proposal. The Board notes that these policies
specifically address alterations of commercial loan documents and
provide audit procedures to review for compliance. In light of all the
facts of record, the Board does not believe that commenter's allegations warrant denial of these applications.




corporations or projects designed primarily to promote
community welfare in north central Pennsylvania.
These activities are permissible for bank holding companies under the Board's Regulation Y, 6 and Meridian
proposes to conduct these activities in accordance
with the Board's regulations.
In order to approve this application, the Board also
must find that the performance of the proposed activities by Susquehanna Life and Commonwealth CDC
"can reasonably be expected to produce benefits to
the public . . . that outweigh possible adverse effects,
such as undue concentration of resources, decreased
or unfair competition, conflicts of interests, or unsound banking practices." 12 U.S.C. § 1843(c)(8).
The Board expects that the continuance of these
activities by these nonbanking subsidiaries would
maintain the level of competition among providers of
these services. In addition, there is no evidence in the
record that consummation of this proposal would
result in any significantly adverse effects, such as
undue concentration of resources, decreased or unfair
competition, conflicts of interests, or unsound banking
practices. Accordingly, the Board concludes that the
balance of the public interest factors that it is required
to consider under section 4(c)(8) of the BHC Act is
favorable, and consistent with approval of Meridian's
section 4 application.
Based on the foregoing and other facts of record, the
Board has determined that the applications should be,
and hereby are, approved. This approval is specifically
conditioned upon compliance by Meridian with all the
commitments made in connection with this application. The Board's determination with respect to its
nonbanking activities also is subject to all of the
conditions set forth in Regulation Y, including those in
sections 225.4(d) and 225.23(b), and to the Board's
authority to require such modification or termination
of the activities of a bank holding company or any of
its subsidiaries as the Board finds necessary to assure
compliance with, and to prevent evasion of, the provisions of the BHC Act and the Board's regulations
and orders issued thereunder. For purposes of this
action, the commitments and conditions relied on in
reaching this decision shall be deemed to be conditions
imposed in writing by the Board and, as such, may be
enforced in proceedings under applicable law.
The banking acquisition approved in this Order shall
not be consummated before the thirtieth calendar day
after the effective date of this Order, and the proposal
shall not be consummated later than three months
after the effective date of this Order, unless such
period is extended for good cause by the Board or by

6. See 12 C.F.R. 225.25(b)(8)® and 225.25(b)(6).

Legal Developments

the Federal Reserve Bank of Philadelphia, acting
pursuant to delegated authority.
By order of the Board of Governors, effective
July 26, 1993.
Voting for this action: Chairman Greenspan and Governors
Mullins, Angell, Kelley, LaWare, and Lindsey. Absent and
not voting: Governor Phillips.
JENNIFER J. JOHNSON

Associate Secretary of the Board

Appendix
Meridian Bank has applied pursuant to section 9 of the
Federal Reserve Act to establish branches at the
following locations:
(1)
(2)
(3)
(4)
(5)

Turner Street, Austin, Pennsylvania
Main Street, Beech Creek, Pennsylvania
20 West Main Street, Canton, Pennsylvania
302 North East Street, Coudersport, Pennsylvania
100 North Academy Avenue, Geisinger Medical
Center, Danville, Pennsylvania*
(6) 608 Continental Boulevard, Danville, Pennsylvania
(7) 101 Mill Street, Danville, Pennsylvania
(8) 12 West Valley Avenue, Elysburg, Pennsylvania
(9) R.D. No. 1, Box 100A, Route 267, Friendsville,
Pennsylvania
(10) 30 West Street, Galeton, Pennsylvania
(11) Route 14 North, South Creek Township, Gillett,
Pennsylvania
(12) Route 11, Mountain View Plaza, Great Bend,
Pennsylvania
(13) 32-42 North Main Street, Hughesville, Pennsylvania
(14) Main and Walnut Streets, Howard, Pennsylvania
(15) 222 Allegheny Street, Jersey Shore, Pennsylvania
(16) R.R. No. 1, Routes 92 and 106, Kingsley, Pennsylvania
(17) 541 Pierce Street, Kingston, Pennsylvania
(18) Lake Como Road and Route 370, Lakewood,
Pennsylvania
(19) 53 Main Street, Lawrenceville, Pennsylvania
(20) Box 150, Main Street, LeRaysville, Pennsylvania
(21) 239 Market Street, Lewisburg, Pennsylvania
(22) Route 15 and Loan Road, Lewisburg, Pennsylvania
(23) Route 45 and Fairground, Lewisburg, Pennsylvania*
(24) Pennsylvania Avenue, Little Meadows, Pennsylvania
(25) 448 Bellfonte Avenue, Lock Haven, Pennsylvania



897

(26) 25 East Main Street, Lock Haven, Pennsylvania
(27) 50 South Main Street, Mansfield, Pennsylvania
(28) R.D. No. 2, Box 41D, Route 328, Millerton,
Pennsylvania
(29) 14 South Front Street, Milton, Pennsylvania
(30) 537 Mahoning Street, Milton, Pennsylvania
(31) 355 Broad Street, Montoursville, Pennsylvania
(32) 780 Broad Street, Montoursville, Pennsylvania*
(33) R.D. No. 1, Route 87 and Beltway, Montoursville, Pennsylvania
(34) 10 Public Avenue, Montrose, Pennsylvania
(35) Route 706, Montrose, Pennsylvania
(36) 49 West Third Street, Mount Carmel, Pennsylvania
(37) 50 West Third Street, Mount Carmel, Pennsylvania
(38) Box 80, Lycoming Mall, Muncy, Pennsylvania
(39) Lycoming Mall, Muncy, Pennsylvania*
(40) 20 South Main Street, Muncy, Pennsylvania
(41) Rear 405, South Main Street, Old Forge, Pennsylvania
(42) 1 South Main Street, Pittston, Pennsylvania
(43) Route 11, Pittston Plaza By-Pass, Pittston, Pennsylvania
(44) 300 Highway 315, Pittston Township, Pennsylvania
(45) Route 54 and Mill Street, Riverside, Pennsylvania*
(46) 364 Erie Avenue, Renovo, Pennsylvania
(47) 102 Desmond Street, Sayre, Pennsylvania
(48) 430 North Keystone Avenue, Sayre, Pennsylvania*
(49) 51 Academy Street, Shinglehouse, Pennsylvania
(50) Route 29 South, South Montrose, Pennsylvania*
(51) 251 Market Street, South Williamsport, Pennsylvania
(52) Main Street, Springville, Pennsylvania
(53) 1300 North Atherton Street, State College, Pennsylvania
(54) 2200 South Atherton Street, State College, Pennsylvania
(55) 121 South Pugh Street, State College, Pennsylvania
(56) 133 Main Street, Susquehanna, Pennsylvania
(57) Jackson Street, Thompson, Pennsylvania
(58) 111-113 Main Street, Towanda, Pennsylvania
(59) Main and Exchange Streets, Troy, Pennsylvania
(60) 109 Main Street, Watsontown, Pennsylvania
(61) 61 Main Street, Wellsboro, Pennsylvania
(62) 16 Main Street, Wellsboro, Pennsylvania
(63) 801 Wyoming Avenue, West Pittston, Pennsylvania
(64) 100 Main Street, Westfield, Pennsylvania
(65) 12 South Main Street, Wilkes-Barre, Pennsylvania

898

Federal Reserve Bulletin • September 1993

(66) 1100 Grampian Boulevard, Williamsport, Pennsylvania*
(67) 1916 Lycoming Creek Road, Williamsport, Pennsylvania
(68) 301 Shiffler Avenue, Williamsport, Pennsylvania
(69) 325 Washington Boulevard, Williamsport, Pennsylvania*
(70) 101 West Third Street, Williamsport, Pennsylvania
(71) 1005 West Third Street, Williamsport, Pennsylvania*
* Denotes automated teller machines owned or leased
by Commonwealth Bank.

R. Banking Limited Partnership
Oklahoma City, Oklahoma
Order Approving the Formation of a Bank Holding
Company
R. Banking Limited Partnership, Oklahoma City,
Oklahoma ("R. Banking"), has applied under section
3(a)(1) of the Bank Holding Company Act ("BHC
Act") (12 U.S.C. § 1842(a)(1)) to become a bank holding company within the meaning of the BHC Act by
acquiring from 21.8 percent to 100 percent of the ten
bank holding companies ("Holding Companies") and
their subsidiary banks ("Banks") listed in the Appendix of this Order.1 R. Banking also has applied under
section 4(c)(8) of the BHC Act to acquire the nonbanking subsidiaries of Holding Companies and thereby
engage in credit insurance activities pursuant to section 225.25(b)(8)(i) of the Board's Regulation Y
(12 C.F.R. 225.25(b)(8)(i)).
Notice of the applications, affording interested persons an opportunity to submit comments, has been
published (57 Federal Register 29,874 (1992)). The
time for filing comments has expired, and the Board
has considered the applications and all comments
received in light of the factors set forth in sections 3(c)
and 4(c)(8) of the BHC Act.
R. Banking is a nonoperating limited partnership
formed for the purpose of acquiring Holding Companies. Upon consummation of the proposal, R. Banking
would become the third largest banking organization in
Oklahoma, controlling deposits of $783 million, representing approximately 3.3 percent of total deposits in
commercial banking organizations in the state.2
All of the banks to be acquired operate in different
banking markets except for BancFirst and McLoud
1. This transaction constitutes a reorganization of a chain banking
organization.
2. All deposit data are as of June 30, 1991.




Bank, which operate in the Oklahoma City banking
market.3 The Oklahoma City banking market would
remain unconcentrated after consummation of this
proposal,4 and numerous competitors would remain in
the market. Accordingly, the Board concludes that
consummation of the proposal would not have a
significantly adverse effect on competition in any
relevant banking market.
The Board has carefully reviewed the financial and
managerial resources and future prospects factors
under the BHC Act in light of comments submitted
by an individual ("Protestant"). Protestant generally
alleges that financial considerations associated with
the proposal are not consistent with approval and
that a principal of R. Banking ("Principal") has
engaged in unsafe and unsound banking practices at
banking institutions currently or formerly controlled
by Principal. Protestant also claims that this transaction will adversely affect the value of other shareholders' stock.
The Board initially notes that the proposal represents a reorganization of certain interests in several
bank holding companies into a single holding company
structure and does not change the existing ownership
interests of other shareholders in the holding companies. In this regard, the principal shareholders would
continue to own their interest in the same proportion
as they do now, and the proposal would simply permit
ownership through a partnership rather than individually. Protestant presents no information on how this
reorganization will affect other shareholders. In addition, the Board has considered Protestant's comments
regarding the financial aspects of the proposal in light
of all the facts of record and concludes that these
comments do not warrant denial of the applications.
The Board has reviewed court documents regarding
transactions that serve as the basis of Protestant's
allegations of unsafe and unsound practices, as well as
relevant examination information regarding these
transactions. The Board has also consulted with the

3. The Oklahoma City banking market is defined as the Oklahoma
City Ranally Metro Area.
4. Upon consummation of the proposal, the Herfindahl-Hirschman
Index ("HHI") in the Oklahoma City banking market will increase
less than 1 point to 531. Under the revised Department of Justice
Merger Guidelines, 49 Federal Register 26,823 (June 29, 1984), a
market in which the post-merger HHI is under 1000 is considered to be
unconcentrated. A market in which the post-merger HHI is above
1800 is considered to be highly concentrated, and the Justice Department is likely to challenge a merger that increases the HHI by more
than 50 points. The Justice Department has informed the Board that a
bank merger or acquisition generally will not be challenged (in the
absence of other factors indicating anticompetitive effects) unless the
post-merger HHI is at least 1800 and the merger increases the HHI by
more than 200 points. The Justice Department has stated that the
higher than normal HHI thresholds for screening bank mergers for
anticompetitive effects implicitly recognize the competitive effect of
limited-purpose lenders and other non-depository financial entities.

Legal Developments

Federal Deposit Insurance Corporation, the primary
regulator of the banks involved, and law enforcement
agencies regarding these transactions. In addition, the
Board has considered the history of management by
Principal at other banks in the chain. In light of these
and all the facts of record, the Board does not believe
considerations relating to the managerial factor warrant denial of these applications.
Based on all the facts of record, the Board concludes that the financial and managerial resources and
the future prospects of R. Banking, as well as other
factors the Board must consider under section 3 of the
BHC Act, are consistent with approval.
R. Banking also has applied pursuant to section
4(c)(8) of the BHC Act to acquire the nonbanking
subsidiaries of Holding Companies and thereby engage
in credit insurance activities. The Board has determined by regulation (12 C.F.R. 225.25(b)(8)(i)) that
this activity is closely related to banking and permissible for bank holding companies under section 4(c)(8)
of the BHC Act.
In order to approve an application under section
4(c)(8) of the BHC Act, the Board also is required to
determine that the performance of the proposed activities by R. Banking "can reasonably be expected to
produce benefits to the public . . . that outweigh
possible adverse effects, such as undue concentration
of resources, decreased or unfair competition, conflicts of interests, or unsound banking practices."
12 U.S.C. § 1843(c)(8). The record does not indicate
that consummation of this proposal is likely to result in
any significantly adverse effects, such as undue concentration of resources, decreased or unfair competition, conflicts of interests, or unsound banking practices. Accordingly, the Board has determined that the
balance of public interest factors it must consider
under section 4(c)(8) of the BHC Act is favorable and
consistent with approval of R. Banking's application
to acquire the nonbanking subsidiaries of Holding
Companies.
Based on the foregoing and other facts of record,
and subject to the commitments made by R. Banking
in this case, the Board has determined that the applications should be, and hereby are, approved. This
approval is specifically conditioned on compliance by
R. Banking with all of the commitments made in
connection with these applications and with the conditions referenced in this Order. The determinations as
to R. Banking's nonbanking activities are also subject
to all the conditions contained in the Board's Regulation Y, including those in sections 225.4(d) and
225.23(b)(3) (12 C.F.R. 225.4(d) and 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 it finds necessary to assure



899

compliance with, or prevent evasion of, the provisions
and purposes of the BHC Act and the Board's regulations and orders issued thereunder. For purposes of
this action, all of these commitments and conditions
are considered conditions imposed in writing and, as
such, may be enforced in proceedings under applicable
law.
The acquisition of Holding Companies shall not be
consummated before the thirtieth calendar day after
the effective date of this Order, and the acquisition of
Holding Companies and nonbanking companies 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, acting pursuant
to delegated authority.
By order of the Board of Governors, effective
July 8, 1993.
Voting for this action: Chairman Greenspan and Governors
Mullins, Angell, LaWare, Lindsey, and Phillips. Absent and
not voting: Governor Kelley.
JENNIFER J. JOHNSON

Associate Secretary of the Board

Appendix
Bank Holding Companies to be Acquired by R. Banking Limited Partnership:
(1) BancFirst Corporation (47.6 percent), and its
subsidiary, BancFirst, both of Oklahoma City,
Oklahoma;
(2) Buffalo Bancshares, Inc. (42.7 percent), and its
subsidiary, Oklahoma State Bank, both of Buffalo, Oklahoma;
(3) Commerce Bancorporation, Inc. (45.9 percent),
and its subsidiary, Bank of Commerce, both of
McLoud, Oklahoma;
(4) Coweta Bancshares, Inc. (100 percent), and its
subsidiary, Security Bank, both of Coweta, Oklahoma;
(5) Dewey County Bancorporation, Inc. (33.7 percent), and its subsidiary, Dewey County State
Bank, both of Taloga, Oklahoma;
(6) Erick Bancorporation, Inc. (66 percent), and its
subsidiary, First American Bank, both of Erick,
Oklahoma;
(7) First Stratford Bancorporation, Inc. (88.2 percent), and its subsidiary, First American Bank,
Stratford, Oklahoma;
(8) Johnston County Bancshares, Inc. (46.7 percent),
and its subsidiary, Bank of Johnston County,
both of Tishomingo, Oklahoma;
(9) Weatherford Bancorporation, Inc. (34.3 percent),

900

Federal Reserve Bulletin • September 1993

and its subsidiary, United Community Bank, both
of Weatherford, Oklahoma; and
(10) Wilburton Bancorporation, Inc. (21.8 percent),
and its subsidiary, Wilburton State Bank, both of
Wilburton, Oklahoma.

Orders Issued Under International Banking Act
Banque Transatlantique
Paris, France
Order Approving Establishment of a Representative
Office
Banque Transatlantique, Paris, France ("Bank"), a
foreign bank within the meaning of the International
Banking Act ("IBA"), has applied under section 10(a)
of the IBA (12 U.S.C. § 3107(a)) to establish a representative office in Washington, D.C. The Foreign
Bank Supervision Enhancement Act of 1991, which
amended the IBA, provides that a foreign bank must
obtain the approval of the Board to establish a representative office in the United States.
Notice of the application affording interested persons an opportunity to submit comments has been
published in a newspaper of general circulation in
Washington, D.C. (The Washington Times, September 9, 1992). The time for filing comments has expired,
and the Board has considered the application and all
comments received.
Bank, with $786.9 million in consolidated assets,1 is
a commercial bank chartered in France. Bank's only
office outside France is a representative office in
London.2 Bank does not engage, directly or indirectly,
in any nonbanking activities in the United States. The
proposed representative office would engage in traditional representational functions, including promoting
Bank's name, products and services to potential customers and serving as a liaison between customers and
Bank's offices in France. Bank is a subsidiary of Credit
Industriel et Commercial de Paris ("CIC Paris"),
which owns 61 percent of Bank.3
In acting on an application to establish a representative office, the IBA and Regulation K provide that
the Board shall take into account whether the foreign

1. Data are as of December 31, 1992, unless otherwise noted.
2. Bank has five subsidiaries that engage in real estate lending,
management and distribution of mutual funds, holding of bank premises, and provision of French goods and services overseas. None of
these subsidiaries operates in the United States.
3. Credito Italiano, an Italian government-controlled commercial
bank, owns 20 percent of Bank. All the shares of CIC Paris are owned
by Union Europeene de CIC, ("CIC"), a commercial bank chartered
in France. Societe Centrale de Groupment des Assurances Nationales, a French government-controlled holding company, directly owns
CIC.




bank engages directly in the business of banking
outside of the United States, has furnished to the
Board the information it needs to assess adequately
the application, and is subject to comprehensive supervision or regulation on a consolidated basis by its
home country supervisor (12 U.S.C. § 3105(d)(2);
12 C.F.R. 211.24). The Board may also take into
account additional standards as set forth in the IBA
(12 U.S.C. § 3105(d)(3)-(4))
and Regulation K
(12 C.F.R. 211.24(c)).
The Board has previously stated that the standards
that apply to the establishment of a branch or agency
need not in every case apply to the establishment of a
representative office because representative offices do
not engage in a banking business and cannot take
deposits or make loans (see 58 Federal Register 6348,
6351 (1993)). In evaluating an application to establish a
representative office under the IBA and Regulation K,
the Board will take into account the standards that
apply to establishment of branches and agencies,
subject to the following considerations. With respect
to supervision by home country authorities, a foreign
bank that proposes to establish a representative office
must be subject to a significant degree of supervision
by its home country supervisor. Among the factors the
Board may consider are the extent to which there is
regular review of a substantial portion of the bank's
operations by the home country supervisor through
examination, review of external audits, or a comparable method; submission of periodic reports relating to
financial performance; and assurance that the bank
itself has a system of internal monitoring and control
that enables bank management to administer properly
the bank's operations. The home country supervisor
must also have indicated that it does not object to the
establishment of the representative office in the United
States.
A foreign bank's financial and managerial resources
will be reviewed to determine whether its financial
condition and performance demonstrate that it is capable of complying with applicable laws and has an
operating record that would be consistent with the
establishment of a representative office in the United
States. If the financial condition of the foreign bank
significantly differs from international norms, the foreign bank would be evaluated to determine whether
such difference could be justified in the context of the
operations of the applicant and the proposed representative office. All foreign banks, whether operating
through branches, agencies or representative offices,
will be required to provide adequate assurances of
access to information on the operations of bank and its
affiliates necessary to determine compliance with U.S.
laws.
In this case, with respect to the issue of supervision

Legal Developments

by home country authorities, the Board has considered the following information. Bank, as well as its
parent banks, CIC Paris and CIC, are subject to the
supervisory authority of the French Ministry of Finance, the Bank of France, the National Credit Counsel, the Credit Establishment Committee, and the
Banking Commission. The Bank of France, which has
authority regarding, inter alia, the proposed expansion
of operations of credit institutions, has indicated that it
does not object to Bank's establishment of the representative office. The Banking Commission, which has
primary responsibility for supervising Bank, monitors
its compliance with French law and regulatory standards as well as its financial condition. The Banking
Commission reviews periodic financial reports submitted by Bank and annual reports prepared by independent auditors.4 Bank is required to file annual, semiannual and quarterly financial reports with the
Banking Commission. Audited consolidated financial
statements of Bank are submitted to the Banking
Commission annually. Bank's quarterly and semiannual reports include unaudited balance sheets and
income statements, and basic financial statements and
key financial ratios covering such areas as risk-based
capital, liquidity, foreign exchange, and concentration
of credit. In addition to reviewing these reports, the
Banking Commission meets with Bank management
on a regular basis.
Examiners from the Bank of France perform on-site
examinations of Bank on behalf of the Banking Commission. The examinations of Bank are performed
approximately once every five years and take approximately three months to complete. A written report is
provided to Bank, and Bank is requested to forward a
copy of the report to its statutory auditors. Bank's
board of directors is required to meet to discuss the
examination's findings. The examiners also meet with
Bank's statutory auditors during the examination. The
examination includes review of Bank's loan portfolio,
deposit composition, banking services, securities and
portfolio management activities, operations and profitability. If any problems are detected, the Banking
Commission has the authority to conduct more frequent examinations and to require additional information from Bank at any time.
Bank is required to maintain records on all of its
subsidiaries and operations worldwide. Bank represents that it has procedures and policies in place to
monitor and control its worldwide activities in accordance with regulatory requirements. Bank conducts

4. Bank's auditors are chosen from a list of firms approved by the
Banking Commission. Representatives from these firms meet frequently with the Banking Commission to discuss general banking
issues.




901

annual internal audits of its offices and subsidiaries.
Based on all the facts of record, which include the
information described above, the Board concludes
that factors relating to the supervision of Bank by its
home country supervisors are consistent with approval of the proposed representative office. Factors
relating to the supervision of CIC and CIC Paris are
also consistent with approval.
The Board has also found that Bank engages directly
in the business of banking outside of the United States
through its commercial banking operations in France.
Bank has provided the Board with the information
necessary to assess the application through submissions that address relevant issues.
The Board has also taken into account the additional
standards set forth in section 7 of the IBA and Regulation K (see 12 U.S.C. § 3105(d)(3)-(4); 12 C.F.R.
211.24(c)(2)). As noted above, the Bank of France has
indicated that it does not object to Bank's establishing
the proposed representative office.
With respect to the financial and managerial resources of Bank, given Bank's record of operations in
its home country, its overall financial resources, and
its standing with its home country supervisors, the
Board has determined that financial and managerial
factors are consistent with approval of the proposed
representative office. Bank appears to have the experience and capacity to support the proposed office and
has also established controls and procedures for the
proposed representative office to ensure compliance
with U.S. law.
Bank has committed that it will make available to
the Board such information on the operations of Bank
and any affiliate of Bank that the Board deems necessary to determine and enforce compliance with the
IBA, the Bank Holding Company Act of 1956, as
amended, and other applicable Federal law. If the
disclosure of such information is prohibited by law,
Bank and its ultimate parent have committed to cooperate with the Board to obtain approvals or consents
that may be required for the Board to gain access to
information that the Board may request. The Board
has reviewed the restrictions on disclosure of information in France, and has communicated with certain
government authorities regarding access to information. In light of these commitments and other facts of
record, and subject to the condition described below,
the Board concludes that Bank has provided adequate
assurances of access to any necessary information the
Board may request.
On the basis of all the facts of record, and subject to
the commitments made by Bank, as well as the terms
and conditions set forth in this Order, the Board has
determined that Bank's application to establish a representative office should be, and hereby is, approved.

902

Federal Reserve Bulletin • September 1993

If any restrictions on access to information on the
operations or activities of Bank and any of its affiliates
subsequently interfere with the Board's ability to
determine the compliance by Bank or its affiliates with
applicable federal statutes, the Board may require
termination of any of the Bank's direct or indirect
activities in the United States. Approval of this application is also specifically conditioned on compliance
by Bank with the commitments made in connection
with this application, and with the conditions contained in this Order. The commitments and conditions
referred to above are conditions imposed in writing by
the Board in connection with its decision, and may be
enforced in proceedings under 12U.S.C. § 1818 or
12 U.S.C. § 1847 against Bank, its offices, and its
affiliates.
By order of the Board of Governors, effective
July 26, 1993.
Voting for this action: Chairman Greenspan and Governors
Mullins, Angell, Kelley, LaWare, and Lindsey. Absent and
not voting: Governor Phillips.
JENNIFER J. JOHNSON

Associate Secretary of the Board

ACTIONS TAKEN UNDER THE FEDERAL DEPOSIT
INSURANCE CORPORATION IMPROVEMENT ACT

By the Board

State Financial Services Corporation
Hales Corners, Wisconsin
Order Approving Application to Acquire a Branch of
a Savings Bank
State Financial Services Corporation, Hales Corners,
Wisconsin ("State Financial"), proposes to purchase
certain assets and assume certain liabilities of the
Waukesha branch office of North Shore Savings Bank,
FSB, Brookfield, Wisconsin ("North Shore Bank"),
through State Financial's wholly owned, nonmember,
state-chartered bank subsidiary, Eastbrook State
Bank, Brookfield, Wisconsin ("Eastbrook Bank").
State Financial has requested Board approval of this
transaction pursuant to section 5(d)(3) of the Federal
Deposit Insurance Act (12 U.S.C. § 1815(d)(3) ("FDI
Act")), as amended by the Federal Deposit Insurance
Corporation Improvement Act of 1991 (Pub. L. No.
102-242, § 501, 105 Stat. 2236, 2388 (1991)). Section
5(d)(3) of the FDI Act requires the Board to review
any proposed merger between a bank owned by a bank
holding company and a savings association, or branch



of a savings association, in which the resulting institution is insured by the Bank Insurance Fund, and, in
reviewing these proposals, to follow the procedures
and consider the factors set forth in section 18(c) of the
FDI Act (12 U.S.C. § 1828(c) ("the Bank Merger
Act")). 12 U.S.C. § 1815(d)(3)(E).1 This transaction is
also subject to review under the Bank Merger Act by
the Federal Deposit Insurance Corporation ("FDIC"),
which is the primary banking regulator for Eastbrook
Bank. The FDIC has recently announced its approval
of the transaction.
Notice of the application, affording interested persons an opportunity to submit comments, has been
given in accordance with the Bank Merger Act and the
Board's Rules of Procedure (12 C.F.R. 262.3(b)). Reports on the competitive effects of the merger were
requested from the United States Attorney General,
the Office of the Comptroller of the Currency
("OCC"), and the FDIC. The time for filing comments
has expired, and the Board has considered the application and all comments received in light of the factors
set forth in the Bank Merger Act and section 5(d)(3) of
the FDI Act.
State Financial is the 21st largest commercial banking organization in Wisconsin, controlling deposits of
$174.0 million, representing less than 1 percent of total
deposits in commercial banking organizations in the
state.2 The Waukesha branch office of North Shore
Bank controls deposits of $17.9 million, representing
less than 1 percent of total deposits in thrift institutions
in the state. Upon consummation of the proposed
transaction, State Financial would become the 20th
largest commercial banking organization in Wisconsin,
controlling deposits of $191.8 million, representing
less than 1 percent of total deposits in commercial
banking organizations in the state.
State Financial and North Shore Bank compete in
the Milwaukee banking market.3 State Financial is the
15th largest depository institution in that market,4

1. These factors include considerations relating to competition,
financial and managerial resources, and future prospects of the
existing and proposed institutions, and the convenience and needs of
the communities to be served. 12 U.S.C. § 1828(c).
2. Bank deposit and state data are as of June 30,1992. Thrift deposit
data are as of June 30, 1991.
3. The Milwaukee banking market is approximated by Milwaukee
County, Waukesha County, Ozaukee County, and portions of Jefferson County, Racine County, Walworth County, and Washington
County, all in Wisconsin.
4. In this context, depository institutions include commercial banks,
savings banks, and savings associations. Market share data before
consummation are based on calculations in which the deposits of thrift
institutions are included at 50 percent. The Board previously has
indicated that thrift institutions have become, or have the potential to
become, significant competitors of commercial banks. See WM Bancorp, 76 Federal Reserve Bulletin 788 (1990); National City Corporation, 70 Federal Reserve Bulletin 743 (1984). Because the deposits of

Legal Developments

903

controlling deposits of $169.4 million, representing
approximately 1 percent of total deposits in depository
institutions in the market ("market deposits").5 The
Waukesha branch office of North Shore Bank controls
deposits of $8.9 million, representing less than 1 percent of market deposits. Upon consummation of this
proposal, State Financial would control $187.3 million
in deposits, representing approximately 1 percent of
market deposits. The Herfindahl-Hirschman Index
("HHI") for this market would remain unchanged at
1120 points.6 Based on all the facts of record in this
case, including the relatively small increase in market
share and the de minimis effect on market concentration as measured by the HHI, the Board concludes
that consummation of this proposal would not have a
significantly adverse effect on competition or the concentration of banking resources in the Milwaukee
banking market. The Board also concludes that consummation of this proposal would not have a significantly adverse effect on competition in any other
relevant banking market.

In assessing the impact of this proposal on the
convenience and needs of the communities to be
served, the Board also has considered the programs
that State Financial has in place to serve community
needs, and the programs that State Financial proposes
to implement in connection with this acquisition. The
Board also has taken into account the past record of
performance of the State Financial organization under
the Community Reinvestment Act ("CRA").
In addition, the Board has considered that the FDIC
has also reviewed the CRA record of the banks involved in this transaction in light of the comments
submitted by Protestant, and has approved the merger
of the bank with North Shore Bank under the Bank
Merger Act.

Convenience and Needs Considerations

A. CRA Examinations

In analyzing the convenience and needs factor, the
Board has considered the comments of the Fair Lending Coalition, Milwaukee, Wisconsin ("Protestant"),
submitted in connection with this application. Protestant alleges that State Financial is not satisfactorily
meeting the convenience and needs of the communities it serves because:
(1) State Financial's subsidiary banks exclude from
their service community delineations large portions
of Milwaukee's central city specifically defined by
the City of Milwaukee Comptroller ("the City of
Milwaukee") as a "Target Area";7 and

All of State Financial's subsidiary banks have received
"satisfactory" ratings from their primary regulators in
their most recent examinations for CRA performance.9 In this regard, Eastbrook Bank, chartered in
1990 and acquired by State Financial in July 1992,
received a "satisfactory" rating in the examination of
its CRA performance by the FDIC as of February 16,
1993 ("1993 examination"). North Shore Bank received a "satisfactory" rating from its primary regulator, the Office of Thrift Supervision, in December
1991.

the Waukesha branch office of North Shore Bank will be transferred to
a commercial bank under this proposal, those deposits are included at
100 percent in the calculation of pro forma market share. See Norwest
Corporation, 78 Federal Reserve Bulletin 452 (1992); First Banks,
Inc., 76 Federal Reserve Bulletin 669, 670 n.9 (1990).
5. Market data are as of June 30, 1991.
6. Under the revised Department of Justice Merger Guidelines, 49
Federal Register 26,823 (June 29, 1984), a market in which the
post-merger HHI is between 1000 and 1800 is considered moderately
concentrated. The Justice Department has informed the Board that a
bank merger or acquisition generally will not be challenged (in the
absence of other factors indicating anticompetitive effects) unless the
post-merger HHI is at least 1800 and the merger increases the HHI by
more than 200 points. The Justice Department has stated that the
higher than normal HHI thresholds for screening bank mergers for
anticompetitive effects implicitly recognize the competitive effect of
limited-purpose lenders and other non-depository financial institutions.
7. The City of Milwaukee has defined this area as having the
following four characteristics:
(1) Median assessed property value of one- and two-family dwellings is less than or equal to 80 percent of the median assessed
property value of similar dwellings in the City of Milwaukee;




(2) Protestant believes that the 1990 and 1991 Home
Mortgage Disclosure Act ("HMDA") data indicate
that State Financial's subsidiary banks have failed
to meet the credit needs of African-Americans,
Hispanics, and the residents of the Target Area.8

(2) Median family income of the area is less than or equal to 80
percent of the median family income of the City of Milwaukee;
(3) The proportion of owner-occupied dwellings in the area is less
than or equal to 80 percent of the proportion of owner-occupied
dwellings in the City of Milwaukee; and
(4) The vacancy rate of dwellings in the area is greater than or equal
to 120 percent of the vacancy rate in the City of Milwaukee.
8. In particular, Protestant notes that of the 152 residential loans
made by State Financial's subsidiary banks in the Milwaukee Metropolitan area in 1991, none of the loans was made in the Target Area or
to African-Americans or Hispanics. Protestant also alleges that North
Shore Bank's record of residential lending in the Target Area and to
African-Americans and Hispanics is inadequate.
9. The following subsidiaries, all located in Wisconsin, received
"satisfactory" CRA performance ratings as follows:
(1) Edgewood State Bank, Greenfield ("Edgewood Bank"), from
the FDIC as of November 23, 1992;
(2) University National Bank, Milwaukee ("University Bank"),
from the OCC as of September 30, 1990; and
(3) State Bank, Hales Corners ("State Bank"), from the FDIC as of
February 17, 1993.

904

Federal Reserve Bulletin • September 1993

B. Reasonableness of Delineated Communities
Protestant has raised questions regarding whether the
delineated service communities for State Financial's
subsidiary banks improperly excludes the Milwaukee
Comptroller's Target Area for the central city. A
bank's delineated community under the CRA is "that
local area or areas around each office or group of
offices where [the bank! makes a substantial portion of
its loans and all other areas equidistant from its offices
or those areas."10 In the case of small banks like the
State Financial subsidiaries, the CRA permits the
banks to delineate communities that consist of portions of Standard Metropolitan Statistical Areas
("SMSA") or counties reasonably expected to be
served by the institution.
State Financial has undertaken a number of steps to
ensure that its delineated communities encompass all
appropriate low- and moderate-income neighborhoods, including census tracts located in the City of
Milwaukee's Target Area. Eastbrook Bank's delineated community is in the Western portion of the
Milwaukee SMSA, which is five miles from the Target
Area. University Bank, which is a subsidiary of State
Financial located near the Target Area, currently
serves 16 of the Target Area's census tracts.11 State
Financial has committed to expand the number of
Target Area census tracts served in this area by
University Bank to 41. Moreover, Eastbrook Bank
would add four low- and moderate-income or minority
census tracts to its delineated area as a result of this
acquisition.12 The delineated service communities for
State Financial's remaining banks, Edgewood Bank
and State Bank, were found to be appropriate in their
most recent examination for CRA performance by the
primary supervisor for these banks.

C. HMD A Data and Lending Practices
The Board has carefully reviewed available 1990 and
1991 HMDA data of the State Financial subsidiary
banks and North Shore Bank in light of Protestant's
comments.13 While these data show denial rates that
vary according to race, none of the recent CRA

10. 12 C.F.R. 228.4(b)(2).
11. The OCC has preliminarily indicated that this service area
addresses concerns noted in University Bank's 1990 CRA examination.
12. Applicant has also committed to amend Eastbrook Bank's CRA
statement to reflect Eastbrook's current delineated area and its focus
on consumer lending. The FDIC has preliminarily indicated that the
changes will adequately address its comments in the 1993 examination.
13. Since Eastbrook Bank was not required to file HMDA reports
until 1992, 1990 and 1991 data were unavailable.




performance examinations found any evidence of illegal discrimination or illegal credit practices.14
In addition, the Board notes that State Financial has
taken steps designed to increase its lending activities
in low- and moderate-income and minority areas,
including the Target Area. For example, State Financial has committed that University Bank will originate
$1 million of residential loans in the Target Area within
the next five years. At least 60 percent of these loans
will be to owner-occupants. State Financial has further
committed that University Bank will participate in
various initiatives in the Target Area with officials of
the Eastside Housing Action Coalition ("ESHAC")15
and the North Central Branch of the Metropolitan
Milwaukee YMCA.

D. Other Aspects of CRA Performance
Eastbrook Bank employs a variety of methods to
assist in ascertaining and marketing credit products to
its entire community. These efforts include a customer
call program in which bank officers contact area customers regarding local credit needs. Reports of these
contacts are reviewed by the president of Eastbrook
Bank regularly, as well as by its board of directors on
a monthly basis. Eastbrook Bank also contacts local
community organizations to ascertain community
credit needs,16 and intends to expand these contacts to
include local government officials, churches, and other
community organizations. Eastbrook Bank's marketing efforts include local newspapers and radio stations
and special advertising in various church bulletins.
Eastbrook Bank also offers a variety of consumer
loans and mortgage loans for purchase or construction
of one- to four-family dwelling units. With respect to
small business lending, Eastbrook Bank participates in
a number of government programs designed to help
meet the credit needs of small business owners. For

14. Although the Board is concerned when the record of an
institution indicates disparities in lending to minority applicants, the
Board recognizes that HMDA data alone provide a limited measure of
any given institution's lending in the communities that the institution
serves. The Board also recognizes that HMDA data have limitations
that make the data an inadequate basis, absent other information, for
conclusively demonstrating whether an institution has engaged in
illegal discrimination on the basis of race or ethnicity in making
lending decisions.
15. ESHAC is an organization that provides rental housing, housing
rehabilitation, youth activities, youth counseling, and commercial
rehabilitation in Milwaukee's central city. University Bank's involvement with ESHAC began in 1980 when the bank's president served as
a director of ESHAC. During the 1980's, University Bank served as a
lender to ESHAC for housing rehabilitation purposes.
16. In this regard, Eastbrook Bank has met with First Heritage
Management Company, which operates Heritage Place, a local housing complex for the elderly. As a result of these meetings, the bank has
determined a need for personal banking services, and is in the process
of assessing the feasibility of such a service.

Legal Developments

example, the bank recently approved a Small Business
Administration guaranteed loan and a Wisconsin Business Development Finance Corporation 504 program
debenture for a total of $1.4 million. The bank also has
invested $750,000 in mortgage-related federal agency
bonds.
Based on these and other facts of record, the Board
concludes that convenience and needs considerations,
including the CRA performance records of State
Financial, Eastbrook Bank, and North Shore Bank,
are consistent with approval of this application.
Other

Considerations

The Board also concludes that the financial and managerial resources and future prospects of State Financial and North Shore Bank are consistent with approval of this application. Moreover, the record in this
case shows that:
(1) The transaction will not result in the transfer of
any federally insured depository institution's federal
deposit insurance from one federal deposit insurance fund to the other;
(2) State Financial and North Shore Bank currently
meet, and upon consummation of the proposed
transaction will continue to meet, all applicable
capital standards; and
(3) Since Eastbrook Bank is in Wisconsin and is
acquiring certain assets and assuming certain liabilities of a Wisconsin federal savings bank, the proposed transaction would comply with the Douglas
Amendment if North Shore Bank were a state bank

905

that State Financial was applying to acquire directly. See 12 U.S.C. § 1815(d)(3).
Based on the foregoing and all the facts of record,
the Board has determined that this application should
be, and hereby is, approved. The Board's approval of
this application is conditioned upon State Financial's
compliance with the commitments made in connection
with this application. For purposes of this action, the
commitments and conditions relied on in reaching this
decision are both conditions imposed in writing by the
Board and, as such, may be enforced in proceedings
under applicable law. This approval is limited to the
proposal presented to the Board by State Financial,
and may not be construed as applying to any other
transaction.
This transaction may not be consummated before
the thirtieth calendar day after the effective date of this
Order, or later than three months after the effective
date of this Order, unless such period is extended by
the Board or the Federal Reserve Bank of Chicago,
acting pursuant to delegated authority.
By order of the Board of Governors, effective
July 8, 1993.
Voting for this action: Chairman Greenspan and Governors
Mullins, Angell, LaWare, Lindsey, and Phillips. Absent and
not voting: Governor Kelley.
JENNIFER J. JOHNSON

Associate Secretary of the Board

ACTIONS TAKEN UNDER THE FEDERAL DEPOSIT INSURANCE CORPORATION IMPROVEMENT ACT OF

1991
By Federal Reserve Banks
Copies are available upon request to the Freedom of Information Office, Office of the Secretary, Board of
Governors of the Federal Reserve System, Washington, D.C. 20551.

Bank Holding Company
Liberty Holding Company, Inc.,
Pensacola, Florida




Acquired
Thrift
Liberty Bank of Fort
Walton,
Fort Walton Beach,
Florida

Surviving
Bank(s)
Liberty Bank,
Pensacola, Florida

Approval
Date
July 9, 1993

906

Federal Reserve Bulletin • September 1993

APPLICATIONS APPROVED UNDER BANK HOLDING COMPANY ACT

By the Secretary of the Board
Recent applications have been approved by the Secretary of the Board as listed below. Copies are available upon
request to the Freedom of Information Office, Office of the Secretary, Board of Governors of the Federal Reserve
System, Washington, D.C. 20551.

Section 3

Firstbank Holding Company of
Colorado,
Lakewood, Colorado
FirstBank Holding Company of
Colorado Employee Stock
Ownership Plan,
Lakewood, Colorado
United Bankshares, Inc.,
Charleston, West Virginia

Effective
Date

Bank(s)

Applicant(s)

FirstBank Holding Company of
California,
Lakewood, Colorado

July 28, 1993

Financial Future Corporation,
Ceredo, West Virginia

July 8, 1993

Sections 3 and 4
.

.

Nonbanking Activity/
Company

Appllcant(s)

National City Corporation,
Cleveland, Ohio

Ohio Bancorp,
Youngstown, Ohio
Cortland Bancorp,
Cortland, Ohio
Florida Trust Services of Ohio
Bancorp,
Naples, Florida

Effective
Date
July 22, 1993

APPLICATIONS APPROVED UNDER BANK HOLDING COMPANY ACT

By Federal Reserve Banks
Recent applications have been approved by the Federal Reserve Banks as listed below. Copies are available upon
request to the Reserve Banks.

Section 3
.
Applicant(s)
American Bancorp of Oklahoma,
Inc.,
Edmond, Oklahoma



„ ,, .
Bank(s)
Texas Guaranty National
Bank,
Houston, Texas

Reserve
Bank

Kansas City

Effective
Date

July 6, 1993

Legal Developments

Section 3—Continued

Applicant(s)
CCB Corporation,
Kansas City, Missouri
Central Financial Corporation,
Columbia, Pennsylvania
Central Mortgage Bancshares,
Inc.,
Kansas City, Missouri
Centura Banks, Inc.,
Rocky Mount, North Carolina
Chemical Financial Corporation,
Midland, Michigan
Columbia Banking System, Inc.,
Bellevue, Washington
J.E. Coonley Company,
Hampton, Iowa
Firstar Corporation,
Milwaukee, Wisconsin
F.W.S.F. Corporation,
Milwaukee, Wisconsin
First Community Financial
Corporation,
Elgin, Illinois
First State Bancshares of DeKalb
County, Inc.,
Fort Payne, Alabama
FMB Bancshares, Inc.,
Lakeland, Georgia
Huntington Bancshares,
Incorporated,
Columbus, Ohio
Huntington Bancshares West
Virginia, Inc.,
Columbus, Ohio
Independent Bankshares, Inc.,
Abilene, Texas
Independent Financial Corp.,
Dover, Delaware
Lansing Financial Corporation,
Lansing, Kansas
Mark Twain Bancshares, Inc.,
St. Louis, Missouri
Marquette Bancshares, Inc.,
Minneapolis, Minnesota




Reserve
Bank

Bank(s)
Acquisition Corporation,
Leawood, Kansas
Farmers First Savings
Bank,
Columbia, Pennsylvania
Blue Springs Bank,
Blue Springs, Missouri

Effective
Date

Kansas City

June 30, 1993

Philadelphia

June 24, 1993

Kansas City

July 26, 1993

Richmond

July 7, 1993

Chicago

July 21, 1993

San Francisco

July 6, 1993

Chicago

July 21, 1993

Chicago

July 1, 1993

Chicago

July 15, 1993

Atlanta

July 16, 1993

Atlanta

July 1, 1993

Cleveland

July 9, 1993

The Winters State Bank,
Winters, Texas

Dallas

July 26, 1993

The First State Bank of
Lansing,
Lansing, Kansas
Parkway Financial, Inc.,
Overland Park, Kansas
First State Holding
Company,
Coon Rapids,
Minnesota

Kansas City

July 16, 1993

St. Louis

June 23, 1993

Minneapolis

July 21, 1993

Interim Bank,
Forest City,
North Carolina
Key State Bank,
Owosso, Michigan
Columbia National
Bankshares, Inc.,
Longview, Washington
Sheffield Savings Bank,
Sheffield, Iowa
Athens Bancorp, Inc.,
Wausau, Wisconsin
Bank of Athens,
Wausau, Wisconsin
First Community Bank,
Elgin, Illinois
First State Bank of
DeKalb County,
Fort Payne, Alabama
United Bankshares, Inc.,
Nashville, Georgia
Commerce Banc
Corporation,
Charleston, West
Virginia

907

908

Federal Reserve Bulletin • September 1993

Section 3—Continued
Applicant(s)
Montgomery Bancshares, Inc.,
Montgomery, Illinois
Northeast Bancorp, Inc.,
Brandon, South Dakota
Nowata Bancshares, Inc.,
Nowata, Oklahoma
Paloma Bancshares, Inc.,
Paloma, Illinois
Prestige Financial Corp.,
Flemington, New Jersey
Rolla Holding Company, Inc.,
Rolla, North Dakota
Southeast Capital Corporation
ESOP,
Idabel, Oklahoma
South Plains Financial, Inc.,
Morton, Texas

SouthTrust Corporation,
Birmingham, Alabama
Susquehanna Bancshares, Inc.,
Lititz, Pennsylvania
Western Bancshares, Inc.,
Van Horn, Texas
Wisconsin Bancshares, Inc.,
Newport, Minnesota




Reserve
Bank

Bank(s)
Bank of Montgomery,
Montgomery, Illinois
Wilmot State Bank,
Wilmot, South Dakota
The First National Bank
of Nowata,
Nowata, Oklahoma
Western Illinois Bancorp,
Inc.,
Blandinsville, Illinois
Prestige State Bank,
Flemington, New
Jersey
First National Bank,
Hettinger, North
Dakota
Southeast Capital
Corporation,
Idabel, Oklahoma
South Plains Delaware
Financial Corporation,
Dover, Delaware
Morton Financial
Corporation,
Morton, Texas
South Plains Financial
Corporation,
Dover, Delaware
Hub Financial
Corporation,
Lubbock, Texas
SouthTrust Bank, F.S.B.,
Concord,
North Carolina
Central Financial
Corporation,
Columbia, Pennsylvania
First State Bank,
Loraine, Texas
Security Bancorporation,
Inc.,
Newport, Minnesota

Effective
Date

Chicago

July 21, 1993

Minneapolis

July 13, 1993

Kansas City

July 14, 1993

St. Louis

June 25, 1993

New York

June 25, 1993

Minneapolis

July 19, 1993

Kansas City

July 2, 1993

Dallas

July 19, 1993

Atlanta

July 9, 1993

Philadelphia

June 24, 1993

Dallas

July 13, 1993

Minneapolis

July 16, 1993

Legal Developments

909

Section 4

Applicant(s)
BB&T Financial Corporation,
Wilson, North Carolina
Centura Banks, Inc.,
Rocky Mount, North Carolina

CoreStates Financial Corp.,
Philadelphia, Pennsylvania

Fifth Third Bancorp,
Cincinnati, Ohio
Menomonie Financial Services,
Inc.,
Menomonie, Wisconsin

Mountain Parks Financial
Corporation,
Minneapolis, Minnesota
U.S. Trust Corporation,
New York, New York

Nonbanking Activity/
Company
Southeast Switch, Inc.,
Maitland, Florida
CFS Venture
Corporation,
Rocky Mount, North
Carolina
CoreStates Community
Development
Corporation,
Philadelphia,
Pennsylvania
Shelby County Bancorp,
Shelbyville, Indiana
to engage de novo in the
activities of data
processing and
providing management
consulting to
nonaffiliated depository
institutions
Mountain Parks Data
Corp.,
Golden, Colorado
CTMC Holding Company,
Portland, Oregon

Reserve
Bank

Effective
Date

Richmond

July 15, 1993

Richmond

July 8, 1993

Philadelphia

July 20, 1993

Cleveland

July 20, 1993

Minneapolis

July 8, 1993

Kansas City

July 12, 1993

New York

July 7, 1993

APPLICATIONS APPROVED UNDER BANK MERGER ACT

By Federal Reserve Banks
Recent applications have been approved by the Federal Reserve Banks as listed below. Copies are available upon
request to the Reserve Banks.

Applicant(s)
Colorado National Bank—Grand
Junction,
Grand Junction, Colorado
F & M Bank—Winchester,
Winchester, Virginia

Interim Bank,
Forest City, North Carolina




Bank(s)
Colorado National
Bank—Glen wood,
Glenwood Springs,
Colorado
The Farmers and
Merchants National
Bank of Hamilton,
Hamilton, Virginia
Centura Bank,
Rocky Mount, North
Carolina

Reserve
Bank

Effective
Date

Kansas City

June 30, 1993

Richmond

June 30, 1993

Richmond

July 7, 1993

910

Federal Reserve Bulletin • September 1993

Applications Approved Under Bank Merger Act—Continued
Applicant(s)
New Bank,
Morristown, Tennessee
Sun Bank of Tampa Bay ,
Tampa, Florida
Union Bank and Trust Company,
Bowling Green, Virginia

United Southern Bank of
Morristown,
Morristown, Tennessee
The Hillsboro Sun Bank,
Plant City, Florida
Dominion Bank, N.A.,
Roanoke, Virginia

PENDING CASES INVOLVING THE BOARD OF
GOVERNORS
This list of pending cases does not include suits
against the Federal Reserve Banks in which the Board
of Governors is not named a party.
Kubany v. Board of Governors, et al., No. 93-1428
(D. D.C., filed July 9, 1993). Action challenging
Board determination under the Freedom of Information Act.
Bennett v. Greenspan, No. 93-1813 (D. D.C., filed
April 20, 1993). Employment discrimination action.
Ezell v. Federal Reserve Board, No. 93-0361
(D. D.C., filed February 19, 1993). Action seeking
damages for personal injuries arising from motor
vehicle collision. The Board's motion to dismiss was
filed July 2, 1993.
Amann v. Prudential Home Mortgage Co., et al., No.
93-10320 WD (D. Massachusetts, filed February 12,
1993). Action for fraud and breach of contract
arising out of a home mortgage. On April 17, 1993,
the Board filed a motion to dismiss.
Adams v. Greenspan, No. 93-0167 (D. D.C., filed
January 27,1993). Action by former employee under
the Civil Rights Act of 1964 and the Rehabilitation
Act of 1973 concerning termination of employment.
Sisti v. Board of Governors, No. 93-0033 (D. D.C.,
filed January 6, 1993). Challenge to Board staff
interpretation with respect to margin accounts. The
Board's motion to dismiss was granted on May 13,
1993. On June 3,1993, the petitioner filed a notice of
appeal.
U.S. Check v. Board of Governors, No. 92-2892
(D. D.C., filed December 30, 1992). Challenge to
partial denial of request for information under the
Freedom of Information Act.
CBC, Inc. v. Board of Governors, No. 92-9572 (10th
Cir., filed December 2, 1992). Petition for review of



Reserve
Bank

Bank(s)

Effective
Date

Atlanta

July 9, 1993

Atlanta

June 30, 1993

Richmond

July 7, 1993

civil money penalty assessment against a bank holding company and three of its officers and directors
for failure to comply with reporting requirements.
The Board's brief was filed on March 19, 1993.
DLG Financial Corporation v. Board of Governors,
No. 392 Civ. 2086-G (N.D. Texas, filed October 9,
1992). Action to enjoin the Board and the Federal
Reserve Bank of Dallas from taking certain enforcement actions, and seeking money damages on a
variety of tort and contract theories. On October 9,
1992, the court denied plaintiffs' motion for a temporary restraining order. On March 30, 1993, the
court granted the Board's motion to dismiss as to it,
and also dismissed certain claims against the Reserve Bank. On April 29, the plaintiffs filed an
amended complaint. The Board's motion to dismiss
the amended complaint was filed on May 17.
Zemel v. Board of Governors, No. 92-1056 (D. D.C.,
filed May 4, 1992). Age Discrimination in Employment Act case. The parties' cross-motions for summary judgment are pending.
State of Idaho, Department of Finance v. Board of
Governors, No. 92-70107 (9th Cir., filed February 24, 1992). Petition for review of Board order
returning without action a bank holding company
application to relocate its subsidiary bank from
Washington to Idaho. On June 4, 1993, the Court of
Appeals denied the petition for review.
In re Subpoena Served on the Board of Governors,
Nos. 91-5427, 91-5428 (D.C. Cir., filed December 27,1991). Appeal of order of district court, dated
December 3, 1991, requiring the Board and the
Office of the Comptroller of the Currency to produce
confidential examination material to a private litigant. On June 26,1992, the court of appeals affirmed
the district court order in part, but held that the bank
examination privilege was not waived by the agencies' provision of examination materials to the examined institution, and remanded for further consideration of the privilege issue. On August 6, 1992, the

Legal Developments

district court ordered the matter held in abeyance
pending settlement of the underlying action.
Board of Governors v. Kemal Shoaib, No. CV 91-5152
(C.D. California, filed September 24, 1991). Action
to freeze assets of individual pending administrative
adjudication of civil money penalty assessment by
the Board. On October 15, 1991, the court issued a
preliminary injunction restraining the transfer or
disposition of the individual's assets.
Board of Governors v. Ghaith R. Pharaon, No. 91CIV-6250 (S.D. New York, filed September 17,
1991). Action to freeze assets of individual pending
administrative adjudication of civil money penalty
assessment by the Board. On September 17, 1991,
the court issued an order temporarily restraining the
transfer or disposition of the individual's assets.

FINAL ENFORCEMENT ORDERS ISSUED BY THE
BOARD OF GOVERNORS

Colonial Bancshares, Inc.
Des Peres, Missouri
The Federal Reserve Board announced on July 19,
1993, the issuance of a Cease and Desist Order against
Colonial Bancshares, Inc., Des Peres, Missouri, and
Kenneth Davis, Kenneth Tiemeyer, David Fairchild,
and John Weber, institution-affiliated parties of Colonial Bancshares, Inc.

The Dollar Savings and Trust Company
Youngstown, Ohio
The Federal Reserve Board announced on July 23,
1993, the issuance of a Cease and Desist Order against
The Dollar Savings and Trust Company, Youngstown,
Ohio.

Dan S. Geiger
Beverly Hills, California
The Federal Reserve Board announced on July 19,
1993, the issuance of an Order of Assessment of a Civil
Money Penalty against Dan S. Geiger, an institutionaffiliated party of First Pacific Bancorp, Inc., Beverly
Hills, California.




911

International Bancshares, Inc.
Gladstone, Missouri
The Federal Reserve Board announced on July 19,
1993, the issuance of a Cease and Desist Order against
International Bancshares, Inc., Gladstone, Missouri.

WRITTEN AGREEMENTS APPROVED BY FEDERAL
RESERVE BANKS

American Pacific Bank
Aumsville, Oregon
The Federal Reserve Board announced on July 13,
1993, the execution of a Written Agreement among the
Federal Reserve Bank of San Francisco, the Administrator of the Division of Finance and Corporate
Securities of the State of Oregon, and the American
Pacific Bank, Aumsville, Oregon.

The Dollar Savings and Trust Company
Youngstown, Ohio
The Federal Reserve Board announced on July 23,
1993, the execution of a Written Agreement among
The Dollar Savings and Trust Company, Youngstown,
Ohio, the Federal Reserve Bank of Cleveland, and the
Superintendent of Banks for the State of Ohio.

Glendale Bancorporation
Voorhees, New Jersey
The Federal Reserve Board announced on July 13,
1993, the execution of a Written Agreement between
the Federal Reserve Bank of Philadelphia and Glendale Bancorporation, Voorhees, New Jersey.

Ohio Bancorp
Youngstown, Ohio
The Federal Reserve Board announced on July 23,
1993, the execution of a Written Agreement among
Ohio Bancorp, Youngstown, Ohio, the parent bank
holding company of The Dollar Savings and Trust
Company, Youngstown, Ohio, the Federal Reserve
Bank of Cleveland, and the Superintendent of Banks
for the State of Ohio.

Financial and Business Statistics
CONTENTS

WEEKLY REPORTING COMMERCIAL BANKS

A3 Guide to Tabular Presentation

Assets and liabilities
A22 Large reporting banks
A24 Branches and agencies of foreign banks

Domestic Financial Statistics

MONEY STOCK AND BANK CREDIT

FINANCIAL MARKETS

A4

A25 Commercial paper and bankers dollar
acceptances outstanding
A25 Prime rate charged by banks on short-term
business loans
A26 Interest rates—money and capital markets
A27 Stock market—Selected statistics

A5
A6
A7

Reserves, money stock, liquid assets, and debt
measures
Reserves of depository institutions, Reserve Bank
credit
Reserves and borrowings—Depository
institutions
Selected borrowings in immediately available
funds—Large member banks

FEDERAL FINANCE
POLICY INSTRUMENTS
A8 Federal Reserve Bank interest rates
A9 Reserve requirements of depository institutions
A10 Federal Reserve open market transactions

FEDERAL RESERVE BANKS
A l l Condition and Federal Reserve note statements
A12 Maturity distribution of loan and security
holdings

A28
A29
A30
A30

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
A31 U.S. government securities
dealers—Transactions
A32 U.S. government securities dealers—Positions
and financing
A3 3 Federal and federally sponsored credit
agencies—Debt outstanding

MONETARY AND CREDIT AGGREGATES
A13 Aggregate reserves of depository institutions
and monetary base
A14 Money stock, liquid assets, and debt measures
A16 Deposit interest rates and amounts outstanding—
commercial and BIF-insured banks
A17 Bank debits and deposit turnover
A18 Loans and securities—All commercial banks

COMMERCIAL BANKING INSTITUTIONS
A19 Major nondeposit funds
A20 Assets and liabilities, Wednesday figures




SECURITIES MARKETS AND
CORPORATE FINANCE
A34 New security issues—Tax-exempt state and local
governments and corporations
A3 5 Open-end investment companies—Net sales
and assets
A35 Corporate profits and their distribution
A35 Nonfarm business expenditures on new
plant and equipment
A36 Domestic finance companies—Assets and
liabilities, and consumer, real estate, and business
credit

2

Federal Reserve Bulletin • September 1993

Domestic Financial Statistics—Continued
REAL ESTATE
A37 Mortgage markets
A3 8 Mortgage debt outstanding
CONSUMER INSTALLMENT CREDIT
A39 Total outstanding
A39 Terms
FLOW OF FUNDS
A40
A42
A43
A44

Funds raised in U.S. credit markets
Summary of financial transactions
Summary of credit market debt outstanding
Summary of financial assets and liabilities

Domestic Nonfinancial Statistics

A54 Foreign official assets held at Federal Reserve
Banks
A55 Foreign branches of U.S. banks—Balance
sheet data
A57 Selected U.S. liabilities to foreign official
institutions

REPORTED BY BANKS
IN THE UNITED STATES
A57
A58
A60
A61

Liabilities to and claims on foreigners
Liabilities to foreigners
Banks' own claims on foreigners
Banks' own and domestic customers' claims on
foreigners
A61 Banks' own claims on unaffiliated foreigners
A62 Claims on foreign countries—Combined
domestic offices and foreign branches

REPORTED BY NONBANKING BUSINESS
ENTERPRISES IN THE UNITED STATES

SELECTED MEASURES
A45 Nonfinancial business activity—Selected
measures
A45 Labor force, employment, and unemployment
A46 Output, capacity, and capacity utilization
A47 Industrial production—Indexes and gross value
A49 Housing and construction
A50 Consumer and producer prices
A51 Gross domestic product and income
A52 Personal income and saving

International Statistics

A63 Liabilities to unaffiliated foreigners
A64 Claims on unaffiliated foreigners

SECURITIES HOLDINGS AND TRANSACTIONS
A65 Foreign transactions in securities
A66 Marketable U.S. Treasury bonds and
notes—Foreign transactions

INTEREST AND EXCHANGE RATES

SUMMARY STATISTICS

A67 Discount rates of foreign central banks
A67 Foreign short-term interest rates
A68 Foreign exchange rates

A53 U.S. international transactions—Summary
A54 U.S. foreign trade
A54 U.S. reserve assets

A69 Guide to Statistical Releases and
Special Tables




A3

Guide to Tabular Presentation
SYMBOLS AND
c
e
n.a.
n.e.c.
P
r
*

0
ATS
BIF
CD
CMO
FFB
FHA
FHLBB
FHLMC
FmHA
FNMA
FSLIC
G-7

GENERAL

ABBREVIATIONS

Corrected
Estimated
Not available
Not elsewhere classified
Preliminary
Revised (Notation appears on column heading
when about half of the figures in that column
are changed.)
Amounts insignificant in terms of the last decimal
place shown in the table (for example, less than
500,000 when the smallest unit given is millions)
Calculated to be zero
Cell not applicable
Automatic transfer service
Bank insurance fund
Certificate of deposit
Collateralized mortgage obligation
Federal Financing Bank
Federal Housing Administration
Federal Home Loan Bank Board
Federal Home Loan Mortgage Corporation
Farmers Home Administration
Federal National Mortgage Association
Federal Savings and Loan Insurance Corporation
Group of Seven

G-10
GNMA
GDP
HUD
IMF
IO
IPCs
IRA
MMDA
NOW
OCD
OPEC
OTS
PO
REIT
REMIC
RP
RTC
SAIF
SCO
SDR
SIC
SMSA
VA

Group of Ten
Government National Mortgage Association
Gross domestic product
Department of Housing and Urban
Development
International Monetary Fund
Interest only
Individuals, partnerships, and corporations
Individual retirement account
Money market deposit account
Negotiable order of withdrawal
Other checkable deposit
Organization of Petroleum Exporting Countries
Office of Thrift Supervision
Principal only
Real estate investment trust
Real estate mortgage investment conduit
Repurchase agreement
Resolution Trust Corporation
Savings Association Insurance Fund
Securitized credit obligation
Special drawing right
Standard Industrial Classification
Standard metropolitan statistical area
Veterans Administration

INFORMATION

In many of the tables, components do not sum to totals because
of rounding.
Minus signs are used to indicate (1) a decrease, (2) a negative
figure, or (3) an outflow.
"U.S. government securities" may include guaranteed issues
of U.S. government agencies (the flow of funds figures also




include not fully guaranteed issues) as well as direct obligations of the Treasury. "State and local government" also includes municipalities, special districts, and other political
subdivisions.

A4

DomesticNonfinancialStatistics • September 1993

1.10

R E S E R V E S , M O N E Y STOCK, L I Q U I D A S S E T S , A N D D E B T M E A S U R E S
Percent annual rate of change, seasonally adjusted1
1992

1993

1993

Monetary or credit aggregate
Q4

9.3
9.9
8.4
10.5

25.8
25.3
27.1
12.6

9.3
8.7
9.5
9.1

11.7
.8
.1
1.1
4.9

16.8
2.7
-.2
1.6r
4.3

6.6

Reserves of depository
Total
Required
Nonborrowed
Monetary base

5
6
7
8
9

Concepts of money, liquid assets, and debt4
Ml
M2
M3
L
Debt
components

Time and savings deposits
Commercial banks
Savings, including MMDAs
Small time
Large time '
Thrift institutions
15
Savings, including MMDAs
Small time
16
17
Large time 8 '
12
13
14

Money market mutual funds
18 General purpose and broker-dealer
19 Institution-only
Debt
components4
20
Nonfederal
21

June

Mar.

Apr/

May

10.8
12.4
10.6
9.8

5.6
9.3
8.3
8.5

5.3
3.0
4.3
8.9

.7
3.3
1.1
7.6

36.5
39.5
35.5
13.8

5.1
7.0
3.8
10.9

-3.8
-2.5r
4.4

10.6
2.2
2.4
n.a.
n.a.

-.2
-4.0r
-1.6r
-1.2r
3.9

2.6 r
-.9
-1.3
-.6
5.5

9.2
.6
3.2
4.0
5.8

27.6
10.7r
8.5 r
10.0
6.1

7.3
2.2
-1.3
n.a.
n.a.

-2.4
—3.3r

-3.0
16.8

3.5 r
-1.9

-.1
-19.5

-3.2
-3.5

-2.8
-14.4

-5.4r
-B.O1

-1.4
3.2

-5.5r
ll.O 1

10.9
-17.4
-18.6

12.9
-17.2r
-18.4

1.6
-7.6
-17.9

4.6
-6.7
.1

2.7 r
3.3 r
-12.3

-2.9
-2.9
-20.9

3.2
-9.1
21.3

13.8r
-10.3
3.4 r

6.9
-10.2
-14.5

9.2
-18.6
-14.9

8.7
-21.7
-11.3

-.2
-19.0r
-17.3

1.0
-11.2
-7.5

-10.0
-24.1
-28.6

-5.1
— 12.3r
-18.3

2.3
-9.3
13.0

9.6
—5.9
-14.7r

3.1
-13.3
-11.2

-7.4
32.9

-4.2
-19.4

-10.1
-14.1

-.8
.5

-21.2
25.5

-1.8
-5.9

-5.0
-3.0

17.4
14.4

-1.4
-27.8

10.7
3.0

6.0
3.7

8.6
2.9

5.3
3.4

15.0
2.2

10.9
4.0

10.9
4.3

n.a.
n.a.

1. Unless otherwise noted, rates of change are calculated from average
amounts outstanding during preceding month or quarter.
2. Figures incorporate adjustments for discontinuities, or " b r e a k s , " associated with regulatory changes in reserve requirements. (See also table 1.20.)
3. The seasonally adjusted, break-adjusted monetary base consists of (1)
seasonally adjusted, break-adjusted total reserves (line 1), plus (2) the seasonally
adjusted currency component of the money stock, plus (3) (for all quarterly
reporters on the "Report of Transaction Accounts, Other Deposits, and Vault
C a s h " and for all weekly reporters whose vault cash exceeds their required
reserves) the seasonally adjusted, break-adjusted difference between current vault
cash and the amount applied to satisfy current reserve requirements.
4. Composition of the money stock measures and debt is as follows:
M l : (1) currency outside the U.S. Treasury, Federal Reserve Banks, and the
vaults of depository institutions, (2) travelers checks of nonbank issuers, (3)
demand deposits at all commercial banks other than those owed to depository
institutions, the U.S. government, and foreign banks and official institutions, less
cash items in the process of collection and Federal Reserve float, and (4) other
checkable deposits (OCDs), consisting of negotiable order of withdrawal (NOW)
and automatic transfer service (ATS) accounts at depository institutions, credit
union share draft accounts, and demand deposits at thrift institutions. Seasonally
adjusted M l is computed by summing currency, travelers checks, demand
deposits, and OCDs, each seasonally adjusted separately.
M2: Ml plus (1) overnight (and continuing-contract) repurchase agreements
(RPs) issued by all depository institutions and overnight Eurodollars issued to
U.S. residents by foreign branches of U.S. banks worldwide, (2) savings (including MMDAs) and small time deposits (time deposits—including retail RPs—in
amounts of less than $100,000), and (3) balances in both taxable and tax-exempt
general-purpose and broker-dealer money market funds. Excludes individual
retirement accounts (IRAs) and Keogh balances at depository institutions and
money market funds. Also excludes all balances held by U.S. commercial banks,
money market funds (general purpose and broker-dealer), foreign governments
and commercial banks, and the U.S. government. Seasonally adjusted M2 is
computed by adjusting its non-Mi component as a whole and then adding this
result to seasonally adjusted M l .
M3: M2 plus (1) large time deposits and term RP liabilities (in amounts of
$100,000 or more) issued by all depository institutions, (2) term Eurodollars held
by U.S. residents at foreign branches of U.S. banks worldwide and at all banking
offices in the United Kingdom and Canada, and (3) balances in both taxable and




Q2

Feb.

Q1

institutions2

1
2
3
4

Nontrgnsaction
10 In M2 y
11 In M3 only 6

Q3

n.a.
n.a.

tax-exempt, institution-only money market funds. Excludes amounts held by
depository institutions, the U.S. government, money market funds, and foreign
banks and official institutions. Also excluded is the estimated amount of overnight
RPs and Eurodollars held by institution-only money market funds. Seasonally
adjusted M3 is computed by adjusting its non-M2 component as a whole and then
adding this result to seasonally adjusted M2.
L: M3 plus the nonbank public holdings of U.S. savings bonds, short-term
Treasury securities, commercial paper, and bankers acceptances, net of money
market fund holdings of these assets. Seasonally adjusted L is computed by
summing U.S. savings bonds, short-term Treasury securities, commercial paper,
and bankers acceptances, each seasonally adjusted separately, and then adding
this result to M3.
Debt: Debt of domestic nonfinancial sectors consists of outstanding credit
market debt of the U.S. government, state and local governments, and private
nonfinancial sectors. Private debt consists of corporate bonds, mortgages, consumer credit (including bank loans), other bank loans, commercial paper, bankers
acceptances, and other debt instruments. Data are derived from the Federal
Reserve Board's flow of funds accounts. Data on debt of domestic nonfinancial
sectors are monthly averages, derived by averaging adjacent month-end levels.
Growth rates for debt reflect adjustments for discontinuities over time in the levels
of debt presented in other tables.
5. Sum of (1) overnight RPs and Eurodollars, (2) money market fund balances
(general purpose and broker-dealer), (3) savings deposits (including MMDAs),
and (4) small time deposits.
6. Sum of (1) large time deposits, (2) term RPs, (3) term Eurodollars of U . S .
residents, and (4) money market ftind balances (institution-only), less (5) a
consolidation adjustment that represents the estimated amount of overnight RPs
and Eurodollars held by institution-only money market funds. This sum is
seasonally adjusted as a whole.
7. Small time deposits—including retail RPs—are those issued in amounts of
less than $100,000. All IRA and Keogh account balances at commercial banks and
thrift institutions are subtracted from small time deposits.
8. Large time deposits are those issued in amounts of $100,000 or more,
excluding those booked at international banking facilities.
9. Large time deposits at commercial banks less those held by money market
funds, depository institutions, U.S. government and foreign banks and official
institutions.

Money Stock and Bank Credit

A5

1.11 RESERVES OF DEPOSITORY INSTITUTIONS AND RESERVE BANK CREDIT 1
Millions of dollars

Apr.

Average of
daily figures

Average of daily figures for week ending on date indicated

1993

1993

May

June

May 19

May 26

June 2

June 9

June 16

June 23

June 30

SUPPLYING RESERVE F U N D S

1 Reserve Bank credit outstanding
U.S. government securities
2
Bought outright—System account
3
Held under repurchase agreements . . .
Federal agency obligations
4
Bought outright
5
Held under repurchase agreements . . .
6
Acceptances
Loans to depository institutions
Adjustment credit
7
Seasonal credit
8
9
Extended credit
10
Float
11
Other Federal Reserve assets

344,222

346,081r

354,054

344,923

348,867

347,506

351,713

350,351

354,576

361,081

303,316
3,293

305,421
2,598

312,928
3,537

305,724
904

305,947
5,686

305,007
5,473

311,167
3,401

313,630
0

314,888
2,351

314,052
7,754

5,106
25
0

5,086
117
0

5,050
220
0

5,095
114
0

5,084
390
0

5,054
34
0

5,054
152
0

5,054
0
0

5,054
178
0

5,035
581
0

29
40
0
618
31,794

43
83
0
435r
32,298

55
143
0
468
31,652

8
87
0
671
32,319

20
93
0
161
31,485

27
97
0
57
31,757

7
105
0
422
31,405

5
130
0
412
31,119

19
160
0
402
31,525

202
185
0
650
32,622

12 Gold stock
13 Special drawing rights certificate account .
14 Treasury currency outstanding

11,054
8,018
21,605

11,054
8,018
21,657

11,056
8,018
21,718

11,054
8,018
21,657

11,054
8,018
21,671

11,053
8,018
21,685

11,054
8,018
21,699

11,055
8,018
21,713

11,058
8,018
21,727

11,057
8,018
21,741

335,293
514

338,480
497

342,797
469

338,604
498

338,602
488

341,189
488

342,816
481

342,988
481

342,701
461

342,877
448

6,062
241

5,851
272

8,781
238

5,937
268

6,110
196

5,984
332

4,468
186

5,364
225

9,667
206

16,256
218

6,391
317

6,193
310

6,224
284

6,296
322

6,324
312

6,297
305

6,238
278

6,135
284

6,209
274

6,295
291

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 3

9,148

9,509

9,360

9,243

9,267

9,235

9,369

9,440

9,379

9,301

26,933

25,699r

26,692

24,485

28,311

24,433

28,648

26,220

26,481

26,212

June 16

June 23

June 30

Wednesday figures

End-of-month figures
Apr.

May

June

May 19

May 26

June 2

June 9

SUPPLYING RESERVE F U N D S

1 Reserve Bank credit outstanding
U.S. government securities 2
Bought outright—System account
2
3
Held under repurchase agreements . . .
Federal agency obligations
Bought outright
4
5
Held under repurchase agreements . . .
Acceptances.
6
Loans to depository institutions
7
Adjustment credit
8
Seasonal credit
9
Extended credit
10
Float
11
Other Federal Reserve assets

343,696

346,958r

368,869

342,687

356,734

349,642

349,213

351,462

362,036

368,869

305,381
0

304,494
5,347

313,143
15,056

305,540
35

306,148
11,930

305,878
6,163

311,994
312

314,658
0

313,453
10,261

313,143
15,056

5,095
0
0

5,054
0
0

5,032
949
0

5,095
10
0

5,054
1,120
0

5,054
140
0

5,054
75
0

5,054
0
0

5,054
993
0

5,032
949
0

20
63
2
619
32,517

37
92
0
52r
31,881

1,357
177
0
232
32,924

5
94
0
895
31,012

19
93
0
351
32,019

8
110
0
594
31,694

3
116
0
455
31,204

12
144
0
414
31,180

22
181
0
-229
32,301

1,357
177
0
232
32,924

12 Gold stock
13 Special drawing rights certificate account .
14 Treasury currency outstanding

11,054
8,018
21,629

11,053
8,018
21,685

11,057
8,018
21,741

11,054
8,018
21,657

11,054
8,018
21,671

11,053
8,018
21,685

11,053
8,018
21,699

11,058
8,018
21,713

11,058
8,018
21,727

11,057
8,018
21,741

335,907
505

340,867
489

344,154
432

338,568
489

339,528
483

342,437
481

343,054
481

342,993
481

342,643
451

344,154
432

7,273
221

5,787
194

28,386
286

6,080
263

5,369
246

6,751
451

5,238
203

8,605
292

13,673
186

28,386
286

6,048
291

6,297r
300

6,295
297

6,296
323

6,324
311

6,297
307

6,238
274

6,135
348

6,209
268

6,295
297

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 3

9,847

9,263

8,705

9,094

9,139

9,045

9,294

9,238

9,240

8,705

24,305

24,518r

21,131

22,302

36,077

24,630

25,202

24,158

30,169

21,131

1. For amounts of cash held as reserves, see table 1.12.
2. Includes securities loaned—fully guaranteed by U.S. government securities
pledged with Federal Reserve Banks—and excludes securities sold and scheduled
to be bought back under matched sale-purchase transactions.




3. Excludes required clearing balances and adjustments to compensate for
float,

A6

DomesticNonfinancialStatistics • September 1993

1.12

RESERVES A N D BORROWINGS

Depository Institutions 1

Millions of dollars
Prorated monthly averages of biweekly averages
Reserve classification

1
2
3
4
5
6
7
8
9
10

Reserve balances with Reserve Banks
Total vault cash 3
Applied vault cash 4 ,
Surplus vault cash
Total reserves 6
Required reserves
Excess reserve balances at Reserve Banks . . .
Total borrowings at Reserve Banks 8
Seasonal borrowings
Extended credit 9

1990

1991

1992

1992

Dec.

Dec.

Dec.

Dec.

Jan.

Feb.

Mar.

Apr.

May

June

30,237
31,789
28,884
2,905
59,120
57,456
1,664
326
76
23

26,659
32,510
28,872
3,638
55,532
54,553
979
192
38
1

25,368
34,535
31,172
3,364
56,540
55,385
1,155
124
18
1

25,368
34,535
31,172
3,364
56,540
55,385
1,155
124
18
1

23,636
35,991
32,368
3,623
56,004
54,744
1,260
165
11
1

23,515
33,914
30,368
3,546
53,882
52,778
1,104
45
18
0

24,383
33,293
29,912
3,381
54,296
53,083
1,213
91
26
0

26,975
32,721
29,567
3,154
56,541
55,445
1,096
73
41
0

25,968
33,462
30,133
3,329
56,101r
55,104
996r
121
84
0

26,462
34,106
30,776
3,330
57,238
56,325
913
181
142
0

1993

Biweekly averages of daily figures for weeks ending on date indicated
1993

1
2
3
4
5
6
7
8
9
10

Reserve balances with Reserve Banks
Total vault cash*
Applied vault cash
Surplus vault cash 5
Total reserves
Required reserves
Excess reserve balances at Reserve Banks
Total borrowings at Reserve Banks 8
Seasonal borrowings
Extended credit 9

...

Mar. 3

Mar. 17

Mar. 31

Apr. 14

Apr. 28

May 12

May 26

June 9 r

June 23

July 7

24,335
32,163
28,902
3,261
53,237
52,666
571
56
20
0

24,029
34,487
30,944
3,543
54,973
53,683
1,290
93
22
0

24,747
32,343
29,098
3,245
53,845
52,572
1,273
98
32
0

26,612
33,218
29,995
3,223
56,607
55,763
844
38
31
0

27,586
32,010
28,960
3,050
56,546
55,160
1,387
99
47
1

25,228
34,225
30,816
3,409
56,044
55,217
828
142
71
1

26,396
32,728
29,455
3,273
55,851
54,649
1,202
105
90
0

26,543
33,685
30,391
3,294
56,933
56,109
824
118
101
0

26,352
34,237
30,897
3,341
57,248
56,477
772
158
145
0

26,578
34,385
31,030
3,355
57,608
56,300
1,308
311
190
0

1. Data in this table also appear in the Board's H.3 (502) weekly statistical
release. For ordering address, see inside front cover.
2. Excludes required clearing balances and adjustments to compensate for float
and includes other off-balance-sheet " a s - o f ' adjustments.
3. Total "lagged" vault cash held by depository institutions subject to reserve
requirements. Dates refer to the maintenance periods during which the vault cash
can be used to satisfy reserve requirements. The maintenance period for weekly
reporters ends sixteen days after the lagged computation period during which the
vault cash is held. Before Nov. 25,1992, the maintenance period ended thirty days
after the lagged computation period.
4. All vault cash held during the lagged computation period by "bound"
institutions (that is, those whose required reserves exceed their vault cash) plus
the amount of vault cash applied during the maintenance period by "nonbound"




institutions (that is, those whose vault cash exceeds their required reserves) to
satisfy current reserve requirements.
5. Total vault cash (line 2) less applied vault cash (line 3).
6. Reserve balances with Federal Reserve Banks (line 1) plus applied vault cash
(line 3).
7. Total reserves (line 5) less required reserves (line 6).
8. Also includes adjustment credit.
9. Consists of borrowing at the discount window under the terms and conditions established for the extended credit program to help depository institutions
deal with sustained liquidity pressures. Because there is not the same need to
repay such borrowing promptly as with traditional short-term adjustment credit,
the money market impact of extended credit is similar to that of nonborrowed
reserves.

Money Stock and Bank Credit
1.13 SELECTED BORROWINGS IN IMMEDIATELY AVAILABLE FUNDS

A7

Large Banks1

Millions of dollars, averages of daily figures
1993, week ending Monday
Source and maturity

1
2
3
4

5
6
7
8

Federal funds purchased, repurchase agreements, and
other selected
borrowings
From commercial banks in the United States
For one day or under continuing contract
For all other maturities
From other depository institutions, foreign banks and
official institutions, and U.S. government agencies
F o r one day or under continuing contract
For all other maturities
Repurchase agreements on U.S. government
agency securities
Brokers and nonbank dealers in securities
F o r one day or under continuing contract
F o r all other maturities
All other customers
For one day or under continuing contract
For all other maturities

May 3

May 10

May 17

May 24

May 31

June 7

June 14

June 21

June 28

68,032
13,709

68,197
13,490

69,117
13,227

65,952
12,864

70,624
12,825

74,804
13,802

76,818
14,807

72,102
14,560

67,613
13,505

16,829
19,943

15,975
19,771

18,618
21,278

21,775
20,739

18,376
20,968

19,975
21,003

18,784
21,028

19,191
18,699

20,843
19,745

12,017
26,812

12,028
26,127

12,650
26,634

13,386
27,626

13,028
27,872

15,690
28,435

15,708
28,888

13,790
27,625

11,380
27,186

24,272
14,152

22,777
13,650

23,066
13,877

23,164
13,886

24,170
14,364

23,262
14,441

25,386
14,530

24,028
14,457

23,209
15,108

42,605
22,042

41,271
22,351

40,746
23,830

39,174
20,707

43,503
20,169 r

44,107
23,201

43,067
24,632

44,117
25,825

41,742
21,259

and federal

MEMO

Federal funds loans and resale agreements in
immediately available funds in maturities of one day or
under continuing contract
9 To commercial banks in the United States
10 To all other specified customers 2

1. Banks with assets of $4 billion or more as of Dec. 31, 1988.
Data in this table also appear in the Board's H.5 (507) weekly statistical release.
For ordering address, see inside front cover.




2. Brokers and nonbank dealers in securities, other depository institutions,
foreign banks and official institutions, and U.S. government agencies.

A8

DomesticNonfinancialStatistics • September 1993

1.14

FEDERAL RESERVE B A N K INTEREST RATES
Percent per year
Current and previous levels
Adjustment credit 1

Federal Reserve
Bank

On
7/30/93

Seasonal credit 2

Effective date

Previous rate

On
7/30/93

Boston
New York . . .
Philadelphia..
Cleveland
Richmond....
Atlanta

7/2/92
7/2/92
7/2/92
7/6/92
7/2/92
7/2/92

3.5

3.10

Chicago
St. Louis
Minneapolis..
Kansas C i t y . .
Dallas
San Francisco

7/2/92
7/7/92
7/2/92
7/2/92
7/2/92
7/2/92

3.5

3.10

Extended credit
On
7/30/93

Effective date

Previous rate

7/22/93
7/22/93
7/22/93
7/22/93
7/22/93
7/22/93

7/22/93
7/22/93
7/22/93
7/22/93
7/22/93
7/22/93

3.65

7/22/93
7/22/93
7/22/93
7/22/93
7/22/93
7/22/93

7/22/93
7/22/93
7/22/93
7/22/93
7/22/93
7/22/93

Effective date

Previous rate

3.15

3.60

3.65

Range of rates for adjustment credit in recent years 4

Effective date

In effect Dec. 31, 1977
1978—Jan.
May
July
Aug.
Sept.
Oct.
Nov.

9
20
11
12
3
10
21
22
16
20
1
3

1979—July 20
Aug. 17
20
Sept. 19
21
Oct. 8
10
1980—Feb. 15
19
May 29
30
June 13
16
29
July 28
Sept. 26
Nov. 17
Dec. 5

Range (or
level)—
All F.R.
Banks
6
6-6.5
6.5
6.5-7
7
7-7.25
7.25
7.75
8
8-8.5
8.5
8.5-9.5
9.5
10
10-10.5
10.5
10.5-11
11
11-12
12
12-13
13
12-13
12
11-12
11
10
10-11
11
12
12-13

F.R.
Bank
of
N.Y.
6
6.5
6.5
7
7
7.25
7.25
7.75
8
8.5
8.5
9.5
9.5
10
10.5
10.5
11
11
12
12
13
13
13
12
11
11
10
10
11
12
13

Effective

1981-—May

5

Nov.

7
6
4

Effective date

Range (or
level)—
All F.R.
Banks

F.R.
Bank
of
N.Y.

1986—Aug. 21
22

5.5-6
5.5

5.5
5.5

1987—Sept. 4
11

5.5-6
6

6
6

11.5-12
11.5
11-11.5
11
10.5
10-10.5
10
9.5-10
9.5
9-9.5
9
8.5-9
8.5-9
8.5

11.5
11.5
11
11
10.5
10
10
9.5
9.5
9
9
9
8.5
8.5

1988—Aug.

9
11

6-6.5
6.5

6.5
6.5

1989—Feb. 24
27

6.5-7
7

7
7

9
13
Nov. 71
76
Dec. 74

8.5-9
9
8.5-9
8.5
8

9
9
8.5
8.5
8

1985-—May
—May 70
74

7.5-8
7.5

7.5
7.5

1986-- M a r .

7-7.5
7
6.5-7
6

7
7
6.5
6

Dec.
1982--- J u l y

70
7.3
7.
3
16
77
30
Oct. 17
n
Nov. 7?
76
Dec. 14
15
17
Aug.

13-14
14
13-14
13
12

F.R.
Bank
of
N.Y.
14
14
13
13
12

6.5

6.5

1
4
30
2
13
17
6
7
20
24

6-6.5
6
5.5-6
5.5
5-5.5
5
4.5-5
4.5
3.5-4.5
3.5

6
6
5.5
5.5
5
5
4.5
4.5
3.5
3.5

2
7

3-3.5
3

3
3

3

3

1990—Dec. 19
1991—Feb.
Apr.
May
Sept.
Nov.

1984-—Apr.
—Apr.

Dec.
1992—July

In effect July 30, 1993
7
10
Apr. 71
July 11

1. Available on a short-term basis to help depository institutions meet temporary needs for funds that cannot be met through reasonable alternative sources.
The highest rate established for loans to depository institutions may be charged on
adjustment-credit loans of unusual size that result from a major operating problem
at the borrower's facility.
2. Available to help relatively small depository institutions meet regular
seasonal needs for funds that arise from a clear pattern of intrayearly movements
in their deposits and loans and that cannot be met through special industry
lenders. The discount rate on seasonal credit takes into account rates on market
sources of funds and ordinarily is reestablished on the first business day of each
two-week reserve maintenance period; however, it is never less than the discount
rate applicable to adjustment credit.
3. May be made available to depository institutions when similar assistance is
not reasonably available from other sources, including special industry lenders.
Such credit may be provided when exceptional circumstances (including sustained deposit drains, impaired access to money market funds, or sudden
deterioration in loan repayment performance) or practices involve only a particular institution, or to meet the needs of institutions experiencing difficulties
adjusting to changing market conditions over a longer period (particularly at times
of deposit disintermediation). The discount rate applicable to adjustment credit




Range (or
level)—
All F.R.
Banks

ordinarily is charged on extended-credit loans outstanding less than thirty days;
however, at the discretion of the Federal Reserve Bank, this time period may be
shortened. Beyond this initial period, a flexible rate somewhat above rates on
market sources of funds is charged. The rate ordinarily is reestablished on the first
business day of each two-week reserve maintenance period, but it is never less
than the discount rate applicable to adjustment credit plus 50 basis points.
4. For earlier data, see the following publications of the Board of Governors:
Banking and Monetary Statistics, 1914-1941, and 1941-1970; and the Annual
Statistical Digest, 1970-1979.
In 1980 and 1981, the Federal Reserve applied a surcharge t o short-term
adjustment-credit borrowings by institutions with deposits of $500 million or more
that had borrowed in successive weeks or in more than four weeks in a calendar
quarter. A 3 percent surcharge was in effect from Mar. 17, 1980, through May 7,
1980. A surcharge of 2 percent was reimposed on Nov. 17, 1980; the surcharge
was subsequently raised to 3 percent on Dec. 5,1980, and to 4 percent on May 5,
1981. The surcharge was reduced t o 3 percent effective Sept. 22, 1981, and to 2
percent effective Oct. 12, 1981. As of Oct. 1, 1981, the formula for applying the
surcharge was changed from a calendar quarter to a moving thirteen-week period.
The surcharge was eliminated on N o v . 17, 1981.

Policy Instruments

A9

1.15 RESERVE REQUIREMENTS OF DEPOSITORY INSTITUTIONS1

Type of deposit

Net transaction accounts
1 $0 million-$46.8 million...
2 More than $46.8 million 4 ..

12/15/92
12/15/92

3

Nonpersonal time deposits 5

12/27/90

4

Eurocurrency liabilities 6 . .

12/27/90

1. Required reserves must be held in the form of deposits with Federal Reserve
Banks or vault cash. Nonmember institutions may maintain reserve balances with
a Federal Reserve Bank indirectly on a pass-through basis with certain approved
institutions. For previous reserve requirements, see earlier editions of the Annual
Report or the Federal Reserve Bulletin. Under provisions of the Monetary
Control Act, depository institutions include commercial banks, mutual savings
banks, savings and loan associations, credit unions, agencies and branches of
foreign banks, and Edge corporations.
2. The Garn-St Germain Depository Institutions Act of 1982 (Public Law
97-320) requires that $2 million of reservable liabilities of each depository
institution be subject to a zero percent reserve requirement. The Board is to adjust
the amount of reservable liabilities subject to this zero percent reserve requirement each year for the succeeding calendar year by 80 percent of the percentage
increase in the total reservable liabilities of all depository institutions, measured
on an annual basis as of June 30. No corresponding adjustment is to be made in
the event of a decrease. On Dec. 15, 1992, the exemption was raised from $3.6
million to $3.8 million. The exemption applies in the following order: (1) net
negotiable order of withdrawal (NOW) accounts (NOW accounts less allowable
deductions); and (2) net other transaction accounts. The exemption applies only to
accounts that would be subject to a 3 percent reserve requirement.
3. Include all deposits against which the account holder is permitted to make
withdrawals by negotiable or transferable instruments, payment orders of withdrawal, and telephone and preauthorized transfers in excess of three per month
for the purpose of making payments to third persons or others. However, money
market deposit accounts (MMDAs) and similar accounts subject to the rules that




permit no more than six preauthorized, automatic, or other transfers per month,
of which no more than three may be checks, are not transaction accounts (such
accounts are savings deposits).
The Monetary Control Act of 1980 requires that the amount of transaction
accounts against which the 3 percent reserve requirement applies be modified
annually by 80 percent of the percentage change in transaction accounts held by
all depository institutions, determined as of June 30 each year. Effective Dec. 15,
1992, for institutions reporting quarterly, and Dec. 24, 1992, for institutions
reporting weekly, the amount was increased from $42.2 million to $46.8 million.
4. The reserve requirement was reduced from 12 percent to 10 percent on Apr.
2, 1992, for institutions that report weekly, and on Apr. 16, 1992, for institutions
that report quarterly.
5. For institutions that report weekly, the reserve requirement on nonpersonal
time deposits with an original maturity of less than IVi years was reduced from 3
percent to IV2 percent for the maintenance period that began Dec. 13, 1990, and
to zero for the maintenance period that began Dec. 27, 1990. The reserve
requirement on nonpersonal time deposits with an original maturity of 1 Vi years
or more has been zero since Oct. 6, 1983.
For institutions that report quarterly, the reserve requirement on nonpersonal
time deposits with an original maturity of less than 1 Vi years was reduced from 3
percent to zero on Jan. 17, 1991.
6. The reserve requirement on Eurocurrency liabilities was reduced from 3
percent to zero in the same manner and on the same dates as were the reserve
requirement on nonpersonal time deposits with an original maturity of less than
1V2 years (see note 4).

A10
1.17

DomesticNonfinancialStatistics • September 1993
FEDERAL RESERVE OPEN MARKET TRANSACTIONS1
Millions of dollars
1992
Type of transaction
and maturity

1990

1991

1993

1992
Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

0
0
24,542
0

0
0
19,832
0

0
0
23,796
0

121
0
30,124
0

349
0
26,610
0

U . S . TREASURY SECURITIES

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24

Outright transactions (excluding
transactions)
Treasury bills
Gross purchases
Gross sales
Exchanges
Redemptions
Others within one year
Gross purchases
Gross sales
Maturity shifts
Exchanges
Redemptions
One to five years
Gross purchases
Gross sales
Maturity shifts
Exchanges
Five to ten years
Gross purchases
Gross sales
Maturity shifts
Exchanges
More than ten years
Gross purchases
Gross sales
Maturity shifts
Exchanges
All maturities
Gross purchases
Gross sales
Redemptions

matched

Matched
transactions
25 Gross sales
26 Gross purchases
Repurchase
agreements
27 Gross purchases
28 Gross sales
29 Net change in U.S. Treasury securities

24,739
7,291
241,086
4,400

20,158
120
277,314
1,000

14,714
1,628
308,699
1,600

1,064
0
25,468
0

3,669
0
29,562
0

425
0
25,638
-27,424
0

3,043
0
24,454
-28,090
1,000

1,096
0
36,662
-30,543
0

461
0
7,160
-4,615
0

0
0
2,777
-1,570
0

0
0
561
-1,202
0

0
0
2,892
-6,044
0

279
0
4,303
-2,602
0

244
0
1,950
-1,100
0

0
0
4,108
-4,013
0

250
200
-21,770
25,410

6,583
-21,211
24,594

13,118
0
-34,478
25,811

4,172
0
-6,800
3,415

200
0
-2,777
1,570

0
0
-64
882

0
0
-2,617
4,564

1,441
0
-4,303
2,602

2,490
0
-1,630
800

0
0
-3,652
3,245

1,280
0
-2,037
2,894

2,818
0
-1,915
3,532

1,176
0
-187
800

100
0
0
0

0
0
-497
0

0
0
-98
1,000

716
0
0
0

1,147
0
-320
300

0
0
-333
468

-1,681
1,226

375
0
-1,209
600

2,333
0
-269
1,200

947
0
-173
400

0
0
0
0

0
0
0
0

0
0
-177
480

705
0
0
0

1,110
0
0
0

0
0
-123
300

25,414
7,591
4,400

31,439
120
1,000

34,079
1,628
1,600

7,820
0
0

3,969
0
0

0
0
0

0
0
0

3,141
0
0

5,111
0
0

349
0
0

1,369,052
1,363,434

1,570,456
1,571,534

1,482,467
1,480,140

115,020
117,020

144,232
142,578

114,543
116,510

111,491
113,349

146,563
143,049

127,115
128,924

124,462
123,227

219,632
202,551

310,084
311,752

378,374
386,257

42,373
39,117

48,904
44,697

34,768
42,231

28,544
25,889

37,815
33,714

30,197
36,953

33,987
28,640

24,886

29,729

20,642

13,075

6,521

-5,497

4,513

3,728

163

4,461

0

0

100
-2,186
789
0
0

0

FEDERAL AGENCY OBLIGATIONS

Outright transactions
30 Gross purchases
31 Gross sales
32 Redemptions

0

5
292

0
0

183

632

0

0
0
121

103

0
0
85

0
0
101

0
0
28

0
0
41

41,836
40,461

22,807
23,595

14,565
14,486

2,760
2,506

1,601
1,224

2,237
2,868

1,107
832

1,811
1,519

197
764

2,105
2,105

35 Net change in federal agency obligations

1,192

-1,085

-554

254

256

-734

190

191

-595

-41

36 Total net change in System Open Market
Account

26,078

28,644

20,089

13,329

6,777

-6,231

4,703

3,918

-431

4,420

Repurchase
agreements
33 Gross purchases
34 Gross sales

0
0

0

1. Sales, redemptions, and negative figures reduce holdings of the System Open
Market Account; all other figures increase such holdings.




0

0

Federal Reserve Banks
1.18 FEDERAL RESERVE BANKS

All

Condition and Federal Reserve Note Statements1

Millions of dollars

Account
June 2

June 9

Wednesday

End of month

1993

1993

June 16

June 23

June 30

Apr. 30

May 31

June 30

Consolidated condition statement
ASSETS

1 Gold certificate account
2 Special drawing rights certificate account
3 Coin
Loans
4 To depository institutions
5 Other
6 Acceptances held under repurchase agreements .
Federal agency obligations
7 Bought outright
8 Held under repurchase agreements

11,053
8,018
424

11,053
8,018
421

11,058
8,018
425

11,058
8,018
427

11,057
8,018
408

11,054
8,018
487

11,053
8,018
441

11,057
8,018
408

118
0
0

119
0
0

156
0
0

202
0
0

1,534
0
0

84
0
0

129
0
0

1,534
0
0

5,054
140

5,054
75

5,054
0

5,054
993

5,032
949

5,095
0

5,054
0

5,032
949

312,041

312,306

314,658

323,714

328,199

305,381

309,841

328,199

10 Bought outright 2
11
Bills
12
Notes
13
Bonds
14 Held under repurchase agreements

305,878
144,531
123,870
37,477
6,163

311,994
150,647
123,870
37,477
312

314,658
153,311
123,870
37,477
0

313,453
152,106
123,870
37,477
10,261

313,143
151,796
123,870
37,477
15,056

305,381
144,034
123,936
37,411
0

304,494
143,148
123,870
37,477
5,347

313,143
151,796
123,870
37,477
15,056

15 Total loans and securities.....

317,354

317,555

319,868

329,964

335,714

310,560

315,025

335,714

16 Items in process of collection
17 Bank premises

9,196
1,039

5,763
1,040

5,924
1,040

5,145
1,041

5,522
1,041

5,359
1,034

4,473
1,039

5,522
1,041

22,811
7,892

22,846
7,482

22,668
7,551

22,726
8,652

22,334
9,614

23,043
8,550

23,143
7,820

22,334
9,614

377,787

374,178

376,553

387,030

393,709

368,106

371,013

393,709

321,657

322,257

322,187

321,793

323,253

315,270

320,112

323,253

37,547

39,528

51,244

56,693

38,365

37,279

56,693

31,379
6,751
451
307

31,832
5,238
203
274

30,282
8,605
292
348

37,118
13,673
186
268

27,724
28,386
286
297

30,579
7,273
221
291

31,000
5,787
194
300

27,724
28,386
286
297

8,197
2,216

5,080
2,366

5,600
2,336

4,753
2,340

5,059
2,229

4,624
2,220

4,358
2,217

5,059
2,229

370,958

367,250

369,651

380,131

387,233

360,479

363,966

387,233

3,300
3,054
475

3,289
3,054
584

3,291
3,054
557

3,287
3,054
559

3,288
3,038
150

3,260
3,054
1,313

3,300
3,054
693

3,288
3,038
150

377,787

374,178

376,553

387,030

393,709

368,106

371,013

393,709

319,112

323,213

324,459

324,112

314,236

310,903

313,505

314,236

9 Total U.S. Treasury securities.

Other assets
18 Denominated in foreign currencies
19 All other 4
20 Total assets
LIABILITIES

21 Federal Reserve notes

38,888

22 Total deposits
23
24
25
26

Depository institutions
institutions
U.S. Treasury—General account
Foreign—Official accounts
Other

27 Deferred credit items
^
28 Other liabilities and accrued dividends
29 Total liabilities.
CAPITAL ACCOUNTS

30 Capital paid in
31 Surplus
32 Other capital accounts.
33 Total liabilities and capital accounts
MEMO

34 Marketable U.S. Treasury securities held in custody for
foreign and international accounts

Federal Reserve note statement
35 Federal Reserve notes outstanding (issued to Bank) . . .
36
LESS: Held by Federal Reserve Bank
37
Federal Reserve notes, net
38
39
40
41

Collateral held against notes, net:
Gold certificate account
Special drawing rights certificate account.
Other eligible assets
U.S. Treasury and agency securities

42 Total collateral.

382,302
60,645
321,657

383,619
61,362
322,257

384,889
62,702
322,187

385,805
64,012
321,793

385,553
62,301
323,253

378,585
63,315
315,270

382,009
61,897
320,112

385,553
62,301
323,253

11,053
8,018
0
302,586

11,053
8,018
0
303,186

11,058
8,018
0
303,111

11,058
8,018
0
302,717

11,057
8,018
0
304,178

11,054
8,018
0
296,198

11,053
8,018
0
301,040

11,057
8,018
0
304,178

321,657

322,257

322,187

321,793

323,253

315,270

320,112

323,253

1. Some of the data in this table also appear in the Board's H.4.1 (503) weekly
statistical release. F o r ordering address, see inside front cover.
2. Includes securities loaned—fully guaranteed by U.S. Treasury securities
pledged with Federal Reserve Banks—and excludes securities sold and scheduled
to be bought back under matched sale-purchase transactions.




3. Valued monthly at market exchange rates.
4. Includes special investment account at the Federal Reserve Bank of Chicago
in Treasury bills maturing within ninety days.
5. Includes exchange-translation account reflecting the monthly revaluation at
market exchange rates of foreign exchange commitments.

A12

DomesticNonfinancialStatistics • September 1993

1.19 FEDERAL RESERVE BANKS

Maturity Distribution of Loan and Security Holding

Millions of dollars

Type of holding and maturity

1 Total loans
1

2 Within fifteen days
3 Sixteen days to ninety days . . .
4 Ninety-one days to one year . .
5 Total acceptances

.

Wednesday

End of month

1993

1993

June 2

June 9

June 16

June 23

June 30

Apr. 30

May 31

June 30

118

119

156

202

1,534

84

129

1,534

1,447
87
0

54
30
0

82
47
0

1,447
87
0

33
85
0

33
86
0

145
11
0

183
19
0

0

0

0

0

0

0

0

0

0
0
0

0
0
0

0
0
0

0
0
0

6 Within fifteen days
7 Sixteen days to ninety days . . .
8 Ninety-one days to one year . .

0
0
0

0
0
0

0
0
0

0
0
0

9 Total U.S. Treasury securities..

312,041

312,306

314,658

323,714

328,199

305,381

304,494

328,199

Within fifteen day s
Sixteen days to ninety days . . .
Ninety-one days to one year . .
One year to five years
Five years to ten years
More than ten years

19,630
74,732
94,361
71,613
21,606
30,099

10,327
77,360
101,300
71,613
21,606
30,099

18,248
71,674
101,418
71,613
21,606
30,099

27,122
71,631
101,643
71,613
21,606
30,099

29,971
74,113
101,750
70,660
21,606
30,099

11,295
74,524
95,254
72,915
21,471
29,922

8,196
79,097
94,431
71,065
21,606
30,099

29,971
74,113
101,750
70,660
21,606
30,099

16 Total federal agency obligations

5,194

5,129

5,054

6,047

5,981

5,095

5,054

5,981

Within fifteen day s 1
Sixteen days to ninety days . . .
Ninety-one days to one year . .
One year to five years
Five years to ten years
More than ten years

165
527
1,412
2,237
711
142

100
829
1,110
2,237
711
142

237
592
1,135
2,213
736
142

1,230
592
1,135
2,213
736
142

1,179
612
1,132
2,181
736
142

115
643
1,177
2,307
711
142

301
527
1,136
2,237
711
142

1,179
612
1,132
2,181
736
142

1

10
11
12
13
14
15

17
18
19
20
21
22

1

1. Holdings under repurchase agreements are classified as maturing within
fifteen days in accordance with maximum maturity of the agreements.




Monetary and Credit Aggregates

A13

1.20 AGGREGATE RESERVES OF DEPOSITORY INSTITUTIONS AND MONETARY BASE 1
Billions of dollars, averages of daily figures
1992
Item

1989
Dec.

1990
Dec.

1991
Dec.

Nov.

Total reserves 3
Nonborrowed reserves
Nonborrowed reserves plus extended credit 5
Required reserves
Monetary base 6

Dec.

Jan.

Feb.

Mar.

Apr.

May

June

54.92
54.88
54.88
53.82
355.73

55.17
55.07
55.07
53.95
358.37

55.20
55.12
55.12
54.10
360.64

56.88
56.76
56.76
55.88
364.78

57.12
56.94
56.94
56.21
368.09

Seasonally adjusted

A D J U S T E D FOR
C H A N G E S IN R E S E R V E R E Q U I R E M E N T S 2

1
2
3
4
5

1993

1992
Dec.

40.49
40.23
40.25
39.57
267.73

41.77
41.44
41.46
40.10
293.19

45.53
45.34
45.34
44.56
317.17

54.35
54.23
54.23
53.20
350.80

53.82
53.71
53.71
52.77
347.83

54.35
54.23
54.23
53.20
350.80

54.67
54.50
54.50
53.41
353.22

Not seasonally adjusted
6
7
8
9
10

Total reserves
Nonborrowed reserves
Nonborrowed reserves plus extended credit 5
Required reserves 8
Monetary base

41.77
41.51
41.53
40.85
271.18

43.07
42.74
42.77
41.40
296.68

46.98
46.78
46.78
46.00
321.07

56.06
55.93
55.93
54.90
354.55

54.08
53.97
53.97
53.04
347.89

56.06
55.93
55.93
54.90
354.55

55.97
55.80
55.80
54.71
354.41

53.81
53.77
53.77
52.71
353.18

54.18
54.09
54.09
52.96
356.00

56.37
56.29
56.29
55.27
361.64

55.88
55.76 r
55.76 r
54.88
364.09

56.%
56.78
56.78
56.05
368.75

62.81
62.54
62.56
61.89
292.55
.92
.27

59.12
58.80
58.82
57.46
313.70
1.66
.33

55.53
55.34
55.34
54.55
333.61
.98
.19

56.54
56.42
56.42
55.39
360.90
1.16
.12

54.67
54.56
54.56
53.62
354.25
1.04
.10

56.54
56.42
56.42
55.39
360.90
1.16
.12

56.00
55.84
55.84
54.74
360.88
1.26
.17

53.88
53.84
53.84
52.78
359.56
1.10
.05

54.30
54.20
54.20
53.08
362.59
1.21
.09

56.54
56.47
56.47
55.45
368.18
1.10
.07

56.10
55.98
55.98
55.10
370.47

57.24
57.06
57.06
56.33
375.21
.91
.18

N O T A D J U S T E D FOR
C H A N G E S IN R E S E R V E R E Q U I R E M E N T S 1 9

11
12
13
14
15
16
17

Total reserves 1 1
Nonborrowed reserves
Nonborrowed reserves plus extended credit 5
Required reserves
Monetary base 1 2
Excess reserves
Borrowings from the Federal Reserve

1. Latest monthly and biweekly figures are available from the Board's H.3 (502)
weekly statistical release. Historical data and estimates of the impact on required
reserves of changes in reserve requirements are available from the Monetary and
Reserves Projections Section, Division of Monetary Affairs, Board of Governors
of the Federal Reserve System, Washington, DC 20551.
2. Figures reflect adjustments for discontinuities, or " b r e a k s , " associated with
regulatory changes in reserve requirements. (See also table 1.10)
3. Seasonally adjusted, break-adjusted total reserves equal seasonally
adjusted, break-adjusted required reserves (line 4) plus excess reserves (line 16).
4. Seasonally adjusted, break-adjusted nonborrowed reserves equal seasonally
adjusted, break-adjusted total reserves (line 1) less total borrowings of depository
institutions from the Federal Reserve (line 17).
5. Extended credit consists of borrowing at the discount window under
the terms and conditions established for the extended credit program to help
depository institutions deal with sustained liquidity pressures. Because there is
not the same need to repay such borrowing promptly as with traditional shortterm adjustment credit, the money market impact of extended credit is similar to
that of nonborrowed reserves.
6. The seasonally adjusted, break-adjusted monetary base consists of (1)
seasonally adjusted, break-adjusted total reserves (line 1), plus (2) the seasonally
adjusted currency component of the money stock, plus (3) (for all quarterly
reporters on the "Report of Transaction Accounts, Other Deposits and Vault
C a s h " and for all those weekly reporters whose vault cash exceeds their required
reserves) the seasonally adjusted, break-adjusted difference between current vault
cash and the amount applied to satisfy current reserve requirements.
7. Break-adjusted total reserves equal break-adjusted required reserves (line 9)
plus excess reserves (line 16).
8. To adjust required reserves for discontinuities that are due to regulatory
changes in reserve requirements, a multiplicative procedure is used to estimate




1.00

.12

what required reserves would have been in past periods had current reserve
requirements been in effect. Break-adjusted required reserves include required
reserves against transactions deposits and nonpersonal time and savings deposits
(but not reservable nondeposit liabilities).
9. The break-adjusted monetary base equals (1) break-adjusted total reserves
(line 6), plus (2) the (unadjusted) currency component of the money stock, plus (3)
(for all quarterly reporters on the "Report of Transaction Accounts, Other
Deposits and Vault C a s h " and for all those weekly reporters whose vault cash
exceeds their required reserves) the break-adjusted difference between current
vault cash and the amount applied to satisfy current reserve requirements.
10. Reflects actual reserve requirements, including those on nondeposit liabilities, with no adjustments to eliminate the effects of discontinuities associated
with changes in reserve requirements.
11. Reserve balances with Federal Reserve Banks plus vault cash used to
satisfy reserve requirements.
12. The monetary base, not break-adjusted and not seasonally adjusted,
consists of (l) total reserves (line 11), plus (2) required clearing balances and
adjustments to compensate for float at Federal Reserve Banks, plus (3) the
currency component of the money stock, plus (4) (for all quarterly reporters on
the "Report of Transaction Accounts, Other Deposits and Vault C a s h " and for all
those weekly reporters whose vault cash exceeds their required reserves) the
difference between current vault cash and the amount applied to satisfy current
reserve requirements. Since the introduction of changes in reserve requirements
(CRR), currency and vault cash figures have been measured over the computation
periods ending on Mondays.
13. Unadjusted total reserves (line 11) less unadjusted required reserves (line 14).

A14

DomesticNonfinancialStatistics • September 1993

1.21 MONEY STOCK, LIQUID ASSETS, AND DEBT MEASURES 1
Billions of dollars, averages of daily figures
1993
1989
Dec.

J
item

1990
Dec.

1991
Dec.

1992
Dec.
Mar.

Apr."

May

June

Seasonally adjusted

1
2
3
4
5

Measures2
Ml
M2
M3
L
Debt

6
7
8
9

Ml components
Currency
Travelers checks*
Demand deposits
Other checkable deposits

827.2
3,345.5
4,116.7
4,966.6 r
10,755.3r

899.3
3,445.8
4,168.1
4,982.2
11,219.3

1,026.6
3,4%.9 r
4,166.4 r
5,043.6 r
11,779.7

l,035.3 r
3,472.9 r
4,131.0 r
5,010.6 r
11,903.2

1,043.2
3,474.6
4,142.1
5,027.3
11,960.9

1,067.2
3,505.7"
4,171.6"
5,069.1
12,021.3

1,073.7
3,512.1
4,167.1
n.a.
n.a.

222.7
6.9
279.8
285.3

246.7
7.8
278.2
294.5

267.2
7.8
290.5
333.8

292.3
8.1
340.9
385.2

299.0
8.0
342.0
386.3"

301.4
8.1
347.3
386.3

304.0
8.2
359.2
395.7"

306.8
8.0
360.7
398.2

2,438.7
822.8

2,518.3
771.2

2,546.6
722.3

2,470.2 r
669.6

2,437.5 r
658.2 r

2,431.5
667.4

2,438.6"
665.8"

2,438.4
655.0

Commercial banks
12 Savings deposits, including MMDAs
13 Small time deposits . .
14 Large time deposits 1 0 , 1

541.4
534.9
387.7

582.2
610.3
368.7

666.2
601.5
341.3

756.1
506.9"
290.2

754.0"
502.8
275.9

756.0
499.0
280.8

764.7
494.7
281.6"

769.1
490.5
278.2

Thrift institutions
15 Savings deposits, including MMDAs
16 Small time deposits
17 Large time deposits 1 0

349.6
617.8
161.1

338.6
562.0
120.9

376.3
463.2
83.4

429.9
363.2
67.3

424.8
347.5 r
64.5

425.6
344.8
65.2

429.0
343.1
64.4

430.1
339.3
63.8

Money market mutual funds
18 General purpose and broker-dealer
19 Institution-only

317.4
108.8

350.5
135.9

363.9
182.1

342.3
202.3

333.1
200.9

331.7
200.4

336.5
202.8

336.1
198.1

2,249.5
7,837.0"

2,493.4
8,261.9"

2,764.8
8,454.5

3,069.0
8,710.7

3,128.5
8,774.7

3,156.8
8,804.1

3,185.5
8,835.8

794.6
3,233.3
4,056.1
4,886.1
10,086.5 r

Nontrgnsaction
10 In M 2 '
11 In M3

components

Debt components
20 Federal debt
21 Nonfederal debt

n.a.
n.a.

Not seasonally adjusted

22
23
24
25
26

Measures2
Ml
M2
M3
L
Debt

27
28
29
30

Ml components
Currency 3
Travelers checks 4
Demand deposits 5
Other checkable deposits 6

811.5
3,245.1
4,066.4
4,906.0
10,073.4"

843.7
3,357.0
4,126.3
4,988.0 r
10,743.9r

916.4
3,457.9
4,178.1
5,004.2
11,209.4

1,045.8
3,511.l r
4,178.5 r
5,068.1 r
11,771.3

1,030.8
3,479.7"
4,141.0"
5,024.2 r
11,863.5

1,058.4
3,498.1
4,161.1
5,045.2
11,919.1

1,057.9"
3,490.1"
4,158.1"
5,043.9
11,974.3

1,073.1
3,507.7
4,162.3
n.a.
n.a.

225.3
6.5
291.5
288.1

249.5
7.4
289.9
296.9

269.9
7.4
302.9
336.3

295.0
7.8
355.3
387.7

297.9
7.8
336.4
388.8 r

301.4
7.8
350.7
398.6

2,433.6
821.4

2,513.2
769.3

2,541.5
720.1

2,465.3 r
667.4

2,448.9"
661.3 r

2,439.7
663.0

2,432.2"
668.0"

2,434.6
654.6

Commercial banks
33 Savings deposits, including MMDAs
34 Small time deposits'' . .
35 Large time deposits • 11

543.0
533.8
386.9

580.1
610.5
367.7

663.3
602.0
340.1

752.3
507,7 r
289.1

757.5
502.1
276.8

760.8
497.8
280.0

765.8
492.4
283.3"

772.4
488.6
279.8

Thrift institutions
36 Savings deposits, including MMDAs
37 Small time deposits®
38 Large time deposits 10

347.4
616.2
162.0

337.3
562.1
120.6

374.7
463.6
83.1

427.8
363.8
67.1

426.8
347.0"
64.7

428.3
343.9
65.0

429.6
341.6"
64.8"

432.0
338.0
64.2

Money market mutual funds
39 General purpose and broker-dealer
40 Institution-only

315.7
109.1

348.4
136.2

361.5
182.4

340.0
202.4

342.2
203.6

337.9
199.5

334.8
203.0

333.0
194.3

Repurchase
41 Overnight
42 Term

77.5
178.4

74.7
158.3

76.3
130.1

73.9
126.3

73.2
136.3"

71.0
138.6

68.0"
139.6"

70.6
139.8

2,491.3
8,252.5 r

2,765.0
8,444.4

3,069.8
8,701.5

Nontrgnsaction
31 In M2
32 In M3 8

components

agreements

and

307.5
8.2
359.6
397.9

Eurodollars

Debt components
43 Federal debt
44 Nonfederal debt
Footnotes appear on following page.




304.4
7.9
352.1
393.5

2,247.5
7,826.0"

3,121.4
8,742.1

3,142.9
8,776.2

3,161.1
8,813.2

n.a.
n.a.

Monetary and Credit Aggregates

NOTES TO TABLE 1.21
1. Latest monthly and weekly figures are available from the Board's H.6 (508)
weekly statistical release. Historical data are available from the Money and
Reserves Projection Section, Division of Monetary Affairs, Board of Governors of
the Federal Reserve System, Washington, DC 20551.
2. Composition of the money stock measures and debt is as follows:
Ml: (1) currency outside the U.S. Treasury, Federal Reserve Banks, and the
vaults of depository institutions, (2) travelers checks of nonbank issuers, (3)
demand deposits at all commercial banks other than those owed to depository
institutions, the U.S. government, and foreign banks and official institutions, less
cash items in the process of collection and Federal Reserve float, and (4), other
checkable deposits (OCDs), consisting of negotiable order of withdrawal (NOW)
and automatic transfer service (ATS) accounts at depository institutions, credit
union share draft accounts, and demand deposits at thrift institutions. Seasonally
adjusted Ml is computed by summing currency, travelers checks, demand
deposits, and OCDs, each seasonally adjusted separately.
M2: Ml plus (1) overnight (and continuing-contract) repurchase agreements
(RPs) issued by all depository institutions and overnight Eurodollars issued to
U.S. residents by foreign branches of U.S. banks worldwide, (2) savings (including MMDAs) and small time deposits (time deposits—including retail RPs—in
amounts of less than $100,000), and (3) balances in both taxable and tax-exempt
general-purpose and broker-dealer money market funds. Excludes individual
retirement accounts (IRAs) and Keogh balances at depository institutions and
money market funds. Also excludes all balances held by U.S. commercial banks,
money market funds (general purpose and broker-deader), foreign governments
and commercial banks, and the U.S. government. Seasonally adjusted M2 is
computed by adjusting its non-Mi component as a whole and then adding this
result to seasonally adjusted M l .
M3: M2 plus (1) large time deposits and term RP liabilities (in amounts of
$100,000 or more) issued by all depository institutions, (2) term Eurodollars held
by U.S. residents at foreign branches of U.S. banks worldwide and at all banking
offices in the United Kingdom and Canada, and (3) balances in both taxable and
tax-exempt, institution-only money market funds. Excludes amounts held by
depository institutions, the U.S. government, money market funds, and foreign
banks and official institutions. Also excluded is the estimated amount of overnight
RPs and Eurodollars held by institution-only money market funds. Seasonally
adjusted M3 is computed by adjusting its non-M2 component as a whole and then
adding this result to seasonally adjusted M2.
L: M3 plus the nonbank public holdings of U.S. savings bonds, short-term
Treasury securities, commercial paper, and bankers acceptances, net of money




A15

market fund holdings of these assets. Seasonally adjusted L is computed by
summing U.S. savings bonds, short-term Treasury securities, commercial paper,
and bankers acceptances, each seasonally adjusted separately, and then adding
this result to M3.
Debt: Debt of domestic nonfinancial sectors consists of outstanding credit
market debt of the U.S. government, state and local governments, and private
nonfinancial sectors. Private debt consists of corporate bonds, mortgages, consumer credit (including bank loans), other bank loans, commercial paper, bankers
acceptances, and other debt instruments. Data are derived from the Federal
Reserve Board's flow of funds accounts. Debt data are based on monthly
averages. This sum is seasonally adjusted as a whole.
3. Currency outside the U.S. Treasury, Federal Reserve Banks, and vaults of
depository institutions.
4. Outstanding amount of U.S. dollar-denominated travelers checks of nonbank issuers. Travelers checks issued by depository institutions are included in
demand deposits.
5. Demand deposits at commercial banks and foreign-related institutions other
than those owed to depository institutions, the U.S. government, and foreign
banks and official institutions, less cash items in the process of collection and
Federal Reserve float.
6. Consists of NOW and ATS account balances at all depository institutions,
credit union share draft account balances, and demand deposits at thrift institutions.
7. Sum of (1) overnight RPs and overnight Eurodollars, (2) money market fund
balances (general purpose and broker-dealer), (3) savings deposits (including
MMDAs). and (4) small time deposits.
8. Sum of (1) large time deposits, (2) term RPs, (3) term Eurodollars of U.S.
residents, and (4) money market fund balances (institution-only), less (5) a
consolidation adjustment that represents the estimated amount of overnight RPs
and Eurodollars held by institution-only money market funds.
9. Small time deposits—including retail RPs—are those issued in amounts of
less than $100,000. All IRAs and Keogh accounts at commercial banks and thrift
institutions are subtracted from small time deposits.
10. Large time deposits are those issued in amounts of $100,000 or more,
excluding those booked at international banking facilities.
11. Large time deposits at commercial banks less those held by money market
funds, depository institutions, U.S. government, and foreign banks and official
institutions.

A16
1.22

DomesticNonfinancialStatistics • September 1993
DEPOSIT INTEREST RATES A N D A M O U N T S OUTSTANDING

Commercial and BIF-insured saving banks 1
1993R

1992

It m

Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

June

Interest rates (annual effective yields)
INSURED COMMERCIAL BANKS
1
2

Negotiable order of withdrawal accounts . . .
Savings deposits 2

4.89
5.84

3.76
4.30

2.39
2.94

2.36
2.90

2.33
2.88

2.32
2.85

2.27
2.80

2.21
2.73

2.16
2.68

2.12
2.65

2.09
2.61

3
4
5
6
7

Interest-bearing time deposits with balances
of less than $100,000, by maturity
1 to 91 days
92 to 182 days
183 days to 1 year
More than 1 year to 2Vi years
More than 2 Vz years

6.94
7.19
7.33
7.42
7.53

4.18
4.41
4.59
4.95
5.52

2.89
3.11
3.30
3.78
4.60

2.91
3.14
3.34
3.83
4.70

2.90
3.16
3.37
3.88
4.77

2.86
3.13
3.35
3.88
4.72

2.81
3.08
3.29
3.83
4.59

2.75
3.03
3.22
3.74
4.52

2.72
2.99
3.19
3.67
4.47

2.70
2.98
3.18
3.64
4.47

2.68
2.98
3.18
3.64
4.44

8
Y

Negotiable order of withdrawal accounts . . .
Savings deposits

5.38

4.44

2.57

2.52

2.45

2.40

2.37

2.21

2.14

4.97

3.29

3.22

3.20

3.17

3.14

2.32
3.05

2.25

6.01

2.97

2.93

2.88

7.64
7.69
7.85
7.91
7.99

4.68
4.92
4.99

3.08
3.41

3.10
3.42

3.01

2.95
3.28

5.23

3.90
4.84

3.93
4.88

2.91
3.23
3.48
3.88
4.84

2.87
3.19

3.59

3.13
3.44
3.61
4.02
5.00

3.06
3.38

3.56

2.85
3.17
3.43
3.80
4.74

B I F - I N S U R E D SAVINGS BANKS3

Interest-bearing time deposits with balances
of less than $100,000, by maturity
10 7 to 91 days
n 92 to 182 days
12 183 days to 1 year
13 More than 1 year to iVi years
14 More than 2 Vl years

5.98

3.58

3.35
3.57

3.94
5.02

3.89
4.97

3.52

3.83
4.89

3.45

3.79
4.78

Amounts outstanding (millions of dollars)
INSURED COMMERCIAL BANKS

15 Negotiable order of withdrawal accounts . . .
16 Savings deposits 2
17
Personal
18
Nonpersonal

209,855
570,270
n.a.
n.a.

244,637
652,058
508,191
143,867

267,709

275,465
740,841
575,399
165,442

286,541
738,253
578,757
159,496

277,271
733,836
579,701
154,135

279,944
742,952
585,189
157,764

288,410
748,311
591,784
156,527

281,208
745,627

284,404

570,532
165,525

587,301
158,327

591,694
162,348

Interest-bearing time deposits with balances
of less than $100,000, by maturity
7 to 91 days
92 to 182 days
183 days to 1 year
More than 1 year to 2Vi years
More than 2 Vl years

50,189
168,044
221,007
150,188
139,420

47,094
158,605
209,672
171,721
158,078

39,472
128,683
171,263
155,668
168,556

38,985

38,474
127,831
163,098
152,977
169,708

38,256

127,636
166,995
153,784
168,586

128,083
160,630
151,905
169,371

36,738
128,209
159,631
151,798
172,362

35,519
125,778
158,337
147,958
177,735

34,743
122,306
157,143
147,030
179,006

131,006

147,266

147,664

147,319

147,350

147,069

146,841

146,673

25 Negotiable order of withdrawal a c c o u n t s . . . .
26 Savings deposits
Personal
2V
Nonpersonal
28

8,404
64,456
n.a.
n.a.

9,624
71,215
68,638
2,577

10,126
81,022
77,798
3,224

10,642
82,919
79,667
3,252

10,871
81,786
78,695
3,091

9,858
79,271
76,337
2,934

9,821
79,649
76,634
3,016

Interest-bearing time deposits with balances
of less than $100,000, by maturity
7 to 91 days
92 to 182 days
183 days to 1 year
More than 1 year to 2Vl years
More than 2Vl years

5,724
25,864
37,929
26,103
20,243

4,146
21,686
29,715
25,379
18,665

3,695
17,298
23,085
19,330
19,128

3,895
17,632
22,888
19,258
19,543

3,867
17,345
21,780
18,442
18,845

3,541
16,088
20,627
17,524
18,461

23,535

23,007

22,069

22,265

21,713

21,320

19
20
21
22
23

24 IRA/Keogh Plan deposits

736,057

754,043

33,423

288,425
755,131
592,890
162,241

156,938
144,944
180,077

31,778
115,267
155,398
144,752
178,738

145,492

144,736

144,636

10,219
77,340
74,382
2,957

9,894
76,910
74,020
2,889

10,037
77,489
74,505
2,984

10,402
77,544
74,623
2,921

3,468
15,857
20,301
17,387
18,759

3,194
14,445
19,048
16,835
18,550

3,161
14,308
18,753
16,426
18,632

3,113
14,157
18,549
16,275
18,780

3,022
13,818
18,434
16,088
19,025

21,260

20,096

19,975

19,902

19,845

119,365

B I F - I N S U R E D SAVINGS BANKS3

29
30
31
32
33

34 IRA/Keogh Plan accounts

1. BIF, Bank Insurance Fund. Data in this table also appear in the Board's H.6
(508) Special Supplementary Table monthly statistical release. For ordering
address, see inside front cover. Estimates are based on data collected by the
Federal Reserve System from a stratified random sample of about 460 commercial
banks and 80 savings banks on the last Wednesday of each period. Data are not




seasonally adjusted and include IRA/Keogh deposits and foriegn currency denominated deposits. Data exclude retail repurchase agreements and deposits held in
U.S. branches and agencies of foreign banks.
2. Includes personal and nonpersonal money market deposits.
3. BIF-insured savings banks include both mutual and federal savings banks.

Monetary and Credit Aggregates
1.23

A17

B A N K DEBITS A N D DEPOSIT TURNOVER1
Debits are in billions of dollars; turnover is ratio of debits to deposits; monthly data are at annual rates
1992
Bank group, or type of customer

1990 2

1991 2

1993

19922
Nov.

Dec.

Jan. r

Feb/

Mar.

Apr.

Seasonally adjusted
Demand deposits
1 All insured banks
2 Major New York City banks
3 Other banks
4 Other checkable deposits 4
^
5 Savings deposits including MMDAs

277,157.5
131,699.1
145,458.4

277,758.0
137,352.3
140,405.7

315,806.1
165,572.7
150,233.5

322,187.1
173,393.4
148,793.7

331,038.8
176,089.1
154,949.8

300,602.9
159,191.7
141,411.3

331,126.3
176,683.2
154,443.1

331,026.3 r
166,866.6
164,159.7 r

324,877.0
163,542.4
161,334.6

3,349.0
3,483.3

3,645.5
3,266.1

3,788.1
3,331.3

3,610.0
3,497.2

3,683.9
3,407.3

3,292.5
3,032.3

3,601.4
3,363.3

3,572.6 r
3,562.8 r

3,579.3
3,510.2

797.8
3,819.8
464.9

803.5
4,270.8
447.9

832.4
4,797.9
435.9

796.1
4,624.0
405.2

830.5
4,693.3
429.1

746.5
4,154.7
388.1

817.3
4,525.8
421.9

811.3 r
4,129.1
446.6

792.0
4,120.9
435.5

16.5
6.2

16.2
5.3

14.4
4.7

12.9
4.7

13.1
4.6

11.6
4.1

12.6
4.5

12.5
4.8

12.7
4.7

DEPOSIT TURNOVER

Demand deposits3
6 All insured banks
7 Major New York City banks
8 Other banks
9 Other checkable deposits 4
^
10 Savings deposits including MMDAs

Not seasonally adjusted

DEBITS TO

Demand
deposits3
All insured banks
12 Major New York City banks
13 Other banks
11

14 Other checkable deposits 4
15 Savings deposits including MMDAs

277,290.5
131,784.7
145,505.8

277,715.4
137,307.2
140,408.3

315,808.2
165,595.0
150,213.3

308,015.6
167,578.4
140,437.2

340,982.1
179,987.6
160,994.5

304,760.9
159,198.8
145,562.0

303,619.8
161,174.1
142,445.7

339,172.4 r
170,855.0
168,317.4 r

324,768.4
161,923.2
162,845.2

3,346.7
3,483.0

3,645.6
3,267.7

3,788.1
3,329.0

3,351.3
3,240.4

3,849.3
3,588.0

3,596.2
3,248.8

3,296.7
3,080.3

3,630.2 r
3,529.2 r

3,799.5
3,727.3

798.2
3,825.9
465.0

803.4
4,274.3
447.9

832.5
4,803,5
436.0

754.3
4,494.4
378.5

815.2
4,418.1
426.5

738.2
3,936.3
390.9

771.7
4,213.4
401.1

854.5
4,385.4
470.2

786.7
4,108.4
436.1

16.4
6.2

16.2
5.3

14.4
4.7

12.1
4.4

13.5
4.8

12.4
4.4

11.6
4.1

12.6
4.7

13.0
4.9

DEPOSIT TURNOVER

Demand
deposits3
16 All insured banks
17 Major New York City banks
18 Other banks
19 Other checkable deposits 4
20 Savings deposits including MMDAs

1. Historical tables containing revised data for earlier periods can be obtained
from the Banking and Money Market Statistics Section, Division of Monetary
Affairs, Board of Governors of the Federal Reserve System, Washington, DC
20551.
Data in this table also appear on the Board's G.6 (406) monthly statistical
release. For ordering address, see inside front cover.




2. Annual averages of monthly figures.
3. Represents accounts of individuals, partnerships, and corporations and of
states and political subdivisions.
4. Accounts authorized for negotiable orders of withdrawal (NOWs) and
accounts authorized for automatic transfer to demand deposits (ATSs).
5. Money market deposit accounts.

A18
1.24

DomesticNonfinancialStatistics • September 1993
LOANS A N D SECURITIES

All Commercial Banks'

Billions of dollars, averages of Wednesday figures
1992

1993

Item
July

Aug.

Sept.

Oct.

Nov.

Dec.

Jan.

Feb.

Mar. r

Apr. r

May r

June

Seasonally adjusted
1 Total loans and securities1
2 U.S. government securities
3 Other securities
4 Total loans and leases'
Commercial and industrial . . . . .
Bankers acceptances held . . .
6
V
Other commercial and
industrial
8
U.S. addressees 3
Non-U.S. addressees 3
9
Real estate
10
11
Individual
Security
12
13
Nonbank financial
institutions
14
Agricultural
15
State and political
subdivisions
16
Foreign banks
17
Foreign official institutions
Lease-financing receivables . . . .
18
19
All other loans

2,886.9

2,902.2

2,917.4

2,926.0

2,932.4

2,937.6

2,933.4

2,937.7

2,950.7 r

2,960.8

2,982.9

3,006.8

619.2
177.9
2,089.8
602.5
6.5

632.6
178.2
2,091.4
601.4
6.5

640.6
178.2
2,098.6
601.2
6.3

647.3
178.8
2,099.8
600.8
7.5

651.4
177.3
2,103.8
600.5
7.9

657.1
176.0
2,104.6
597.6
7.8

656.9
174.0
2,102.5 r
598.0 r
7.5

667.3
175.3r
2,095.l r
596.1
8.7

681.5 r
177.0
2,092.2 r
592.4 r
8.9

691.5
177.7
2,091.5
589.6
9.0

694.3
178.4
2,110.3
592.5
9.6

704.5
177.9
2,124.3
594.2
9.5

596.0
585.3
10.7
881.5
358.6
60.5

594.9
584.3
10.6
883.1
357.4
61.6

594.9
583.6
11.3
886.8
357.0
64.0

593.3
582.6
10.7
890.7
355.8
64.7

592.6
582.3
10.3
892.5
355.4
64.2

589.9
580.2
9.7
892.4
355.5
64.8

590.5 r
580.9
9.7
889.9
358.2
63.0

587.3 r
577.5 r
9.8
887.8
360.4
61.7

583.4 r
573.3 r
10.1
888. l r
360.8 r
62.5

580.5
570.8
9.7
887.6
362.6
60.8

582.9
573.2
9.6
893.8
365.7
66.9

584.6
575.6
9.0
900.0
366.9
69.4

41.5
34.9

42.0
35.3

44.0
35.2

43.9
35.1

44.7
35.2

43.6
35.0

45,0 r
34.5

44.8 r
34.3

44.5
34.0

45.3
33.7

45.9
33.8

45.7
33.7

26.2
7.7
2.2
30.8
43.2

25.9
7.2
2.3
30.8
44.3

25.8
7.9
2.5
31.0
43.2

25.4
7.6
2.4
30.8
42.6

25.1
7.5
2.8
30.9
45.0

24.8
7.7
2.8
30.9
49.5

24.2
7.7
2.8
30.3
48.8

23.7
8.5
3.0
30.4
44.5

23.4
8.1
2.9
30.3
45.3

23.1
8.0
2.9
30.3
47.7

23.3
8.1
2.8
30.7
46.8

23.3
8.2
2.9
30.9
49.1

Not seasonally adjusted
20 Total loans and securities'

2,876.1

2,894.5

2,914.9

21 U.S. government securities
22 Other securities
23 Total loans and leases'
Commercial and industrial
24
25
Bankers acceptances held 2 . . .
Other commercial and
26
industrial
U.S. addressees 3
27
Non-U.S. addressees 3
28
29
Real estate
Individual
30
31
Security
Nonbank financial
32
institutions
Agricultural
33
34
State and political
subdivisions
Foreign banks
35
36
Foreign official institutions
Lease-financing receivables . . . .
37
All other loans
38

615.3
176.8
2,084.0
601.5
6.3

631.3
178.1
2,085.0
597.6
6.3

638.7
177.9
2,098.3
597.6
6.2

645.1
179.2
2,100.9
598.4
7.4

654.1
178.3
2,106.6
600.8
8.2

655.8
176.2
2,115.4
600.6
8.0

595.2
584.2
11.0
881.6
356.4
58.0

591.4
580.5
10.8
883.7
356.9
59.4

591.4
580.3
11.1
887.6
358.6
62.5

591.0
580.7
10.3
891.5
356.2
64.2

592.6
582.8
9.8
893.9
356.3
63.5

41.3
35.8

41.8
36.5

43.5
36.7

43.5
36.1

26.1
7.8
2.2
30.6
42.6

25.9
7.0
2.3
30.6
43.2

25.9
8.1
2.5
30.8
44.6

25.5
7.8
2.4
30.8
44.4

2,925.2

1. Adjusted to exclude loans to commercial banks in the United States.
2. Includes nonfinancial commercial paper held.




2,954.5 r

2,962.3

2,977.9

3,006.5

657.3
174.6
2,103.6
596.5
7.7

r

670.8
175.5r
2,094.l r
595.2 r
9.1

687.3 r
176.7 r
2,090.6 r
595.6 r
9.0

693.3
177.2
2,091.8
592.5
8.9

693.2
177.9
2,106.8
594.2
9.5

702.3
177.4
2,126.8
596.0
9.4

592.5
583.0
9.5
893.7
360.0
65.5

588.8 r
579.2
9.6
889.6
362.3
64.5

586.l r
576.3
9.8
886.0
360.4
64.6 r

586.5 r
576.5 r
10.0
885.5 r
358.4 r
64.6

583.6
573.9
9.8
886.5
359.9
64.1

584.7
575.1
9.6
893.9
363.9
63.9

586.6
576.8
9.8
900.3
365.1
69.0

45.0
35.2

45.6
34.8

45.2 r
33.6

44.6
33.0

44.2
32.6 r

44.7
32.8

45.3
33.5

46.3
34.2

25.2
7.8
2.8
30.8
45.4

24.8
8.2
2.8
30.9
48.6

24.0
7.7
2.8
30.7
46.6

23.6
8.4
3.0
30.6
44.6 r

23.5
7.8
2.9
30.5
45.0

23.1
7.7
2.9
30.4
47.2

23.3
7.9
2.8
30.7
47.4

23.3
8.0
2.9
30.9
50.9

2,939.0

2,947.4

2,935.5

2,940.5

3. United States includes the fifty states and the District of Columbia.

Commercial Banking Institutions

A19

1.25 MAJOR NONDEPOSIT FUNDS OF COMMERCIAL BANKS 1
Billions of dollars, monthly averages
1992r

1993

Source of funds
July

Aug.

Sept.

Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

June

Seasonally adjusted
1 Total nondeposit funds 2
2 Net balances owed to related foreign offices 3 ..
3 Borrowings from other than commercial banks
in United States 4
4
Domestically chartered banks
5
Foreign-related banks

297.4
62.2

302.3
61.5

309.3
63.9

303.4
62.6

307.5
67.3

311.4
71.1

311.l r
74.1

309.7 r
73.3

319.6 r
79.1

328.3
88.2 r

324. l r
83.1

332.1
84.4

235.2
147.4
87.8

240.8
151.7
89.2

245.4
153.4
91.9

240.8
154.6
86.2

240.2
153.9
86.4

240.4
154.8
85.6

236.9"
155.4r
81.6

236.3 r
155.5 r
80.9

240.6
159.8
80.8

240.l r
164.4 r
75.6

241.0 r
162.5
78.5

247.8
168.7
79.1

Not seasonally adjusted
6 Total nondeposit funds 2
7 Net balances owed to related foreign offices 3 ..
8
Domestically chartered banks
9
Foreign-related banks
10 Borrowings from other than commercial banks
in United States
11
Domestically chartered banks
12
Federal funds and security RP
borrowings 5
13
Other
14
Foreign-related banks 6

291.9
58.9
-6.6
65.5

297.3
57.7
-9.2
66.9

303.8
61.6
-11.2
72.7

305.7
63.8
-13.4
77.2

312.8
68.9
-12.4
81.4

311.4
75.2
-15.0
90.2

76.7
-15.8
92.5

3I3.9 r
75.2 r
-10.6
85.7

324.4 r
79.8
-7.0
86.8

324.5
85.3 r
-9.5
94.8 r

328.8 r
85.3
-9.8
95.1

331.2
82.4
-15.4
97.8

232.9
144.3

239.6
150.5

242.3
152.3

241.9
155.8

243.9
158.3

236.2
153.8

233.2 r
152.3r

238.8 r
157.2 r

244.6 r
162.6r

239.2 r
162.4r

243.5 r
164. R

248.8
168.5

140.1
4.2
88.7

146.7
3.9
89.1

148.4
3.8
90.0

152.2
3.6
86.1

154.2
4.1
85.5

149.9
4.0
82.3

148.7r
3.6
80.9

154.0r
3.2
81.6

159.3
3.3
82.0

159.01
3.5
76.8

160.3
3.8 r
79.4

164.7
3.8
80.3

387.7
387.4

385.8
387.1

383.2
383.6

375.7
374.9

371.3
371.1

366.5
365.5

359.9
358.0

358.4
358.0

355.7
356.5

355.0
354.2

356.2
357.9

352.4
353.9

23.1
19.6

28.0
22.4

24.1
28.6

21.5
21.9

20.7
16.5

20.4
19.5

25.6
33.1

23.6
29.5

18.8
17.4

24.2
20.3

19.1
20.3

26.2
26.6

MEMO

Gross large time deposits
15 Seasonally adjusted
16 Not seasonally adjusted
U.S. Treasury demand balances
commercial banks
17 Seasonally adjusted
18 Not seasonally adjusted

at

1. Commercial banks are nationally and state-chartered banks in the fifty states
and the District of Columbia, agencies and branches of foreign banks, New York
State investment companies majority owned by foreign banks, and Edge Act and
agreement corporations owned by domestically chartered and foreign banks.
Data in this table also appear in the Board's G.10 (411) monthly release. For
ordering address, see inside front cover.
2. Includes federal funds, repurchase agreements (RPs), and other borrowing
from nonbanks and net balances due to related foreign offices.
3. Reflects net positions of U . S . chartered banks, Edge Act corporations, and
U . S . branches and agencies of foreign banks with related foreign offices plus net
positions with own International Banking Facilities (IBFs).
4. Borrowings through any instrument, such as a promissory note or due bill,
given for the purpose of borrowing money for the banking business. This includes




borrowings from Federal Reserve Banks and from foreign banks, term federal
funds, loan RPs, and sales of participations in pooled loans.
5. Figures are based on averages of daily data reported weekly by approximately 120 large banks and on quarterly or annual data reported by other banks.
6. Figures are partly averages of daily data and partly averages of Wednesday
data.
7. Time deposits in denominations of $100,000 or more. Estimated averages of
daily data.
8. U.S. Treasury demand deposits and Treasury tax and loan notes at commercial banks. Averages of daily data.

A20

DomesticNonfinancialStatistics • September 1993

1.26 ASSETS AND LIABILITIES OF COMMERCIAL BANKS 1

Wednesday figures

Millions of dollars
1993
Account
May 5 r

May 12r

May 191

May 26 r

June 2

June 9

June 16

June 23

June 30

3,123,682
833,066
669,498
163,568
39,679
25,640
2,676

3,122,233
830,586
666,738
163,848
40,591
25,330
2,649

Other cash assets
n
24 Other assets

2,250,937
148,653
2,102,284
594,882
890,884
74,339
816,546
362,371
254,147
211,777
29,306
29,357
32,065
81,914
39,134
276,743

3,126,037
833,365
669,437
163,928
36,011
22,142
2,488
11,382
2,256,661
150,431
2,106,230
592,577
894,640
74,416
820,224
363,258
255,755
215,102
35,087
31,573
30,487
78,835
39,121
270,765

2,251,057
147,552
2,103,505
593,431
892,670
74,382
818,289
363,719
253,685
199,981
24,594
31,804
29,895
74,090
39,598
273,830

3,119,586
827,496
665,010
162,487
36,429
21,413
2,844
12,173
2,255,660
151,751
2,103,909
593,465
893,720
74,500
819,221
364,875
251,849
216,950
38,277
32,609
30,680
74,857
40,527
268,455

3,156,959
838,119
676,005
162,114
43,947
28,805
2,405
12,737
2,274,892
154,282
2,120,611
598,110
897,566
74,505
823,061
365,216
259,718
240,658
27,645
32,810
35,943
101,670
42,590
288,925

3,165,855
838,891
677,499
161,391
43,587
27,421
2,495
13,671
2,283,377
163,804
2,119,573
593,562
899,737
74,449
825,287
364,449
261,825
213,838
27,083
32,261
32,069
79,719
42,708
278,541

3,177,550
835,650
675,293
160,356
43,448
27,598
2,296
13,554
2,298,453
161,710
2,136,743
597,780
900,730
74,867
825,864
364,106
274,127
217,639
26,530
32,207
31,706
83,190
44,006
282,400

3,147,184
834,503
673,547
160,956
45,503
29,153
2,619
13,730
2,267,178
149,257
2,117,921
594,718
897,705
74,757
822,948
365,019
260,479
211,167
32,905
32,436
29,762
73,303
42,761
272,884

3,162,824
840,103
676,925
163,178
33,814
19,088
2,732
11,993
2,288,908
155,329
2,133,578
597,218
902,840
74,822
828,018
366,472
267,049
219,261
23,826
33,152
30,355
86,505
45,423
279,821

25 Total assets

3,612,202

3,611,904

3,596,044

3,604,990

3,686,541

3,658,234

3,677,589

3,631,235

3,661,906

2,510,585
774,213
3,564
40,210
730,439
760,815
621,495
354,061
488,740
18,546
470,194
330,976

2,498,297
760,951
3,011
38,621
719,319
763,898
620,726
352,723
490,736
14,143
476,593
339,094

2,478,437
747,850
3,133
38,019
706,698
758,811
619,332
352,443
500,672
16,620
484,052
333,636

2,481,930
753,296
3,331
38,961
711,005
758,309
618,035
352,290
497,098
14,738
482,360
342,771

2,549,635
807,875
4,225
45,779
757,871
769,140
618,209
354,410
506,257
18,785
487,472
344,949

2,520,120
778,456
3,501
39,281
735,674
772,890
616,658
352,115
512,421
4,890
507,531
338,165

2,530,874
791,150
7,487
39,962
743,701
770,404
616,871
352,449
529,506
30,676
498,830
331,627

2,472,343
746,%5
3,161
37,674
706,130
760,900
615,026
349,452
527,897
35,240
492,657
344,836

2,507,409
795,187
4,281
38,447
752,459
759,265
615,412
337,545
508,883
31,241
477,642
359,176

3,330,302

3,328,127

3,312,745

3,321,800

3,400,841

3,370,706

3,392,007

3,345,076

3,375,468

281,900

283,777

283,190

285,700

287,528

285,582

286,159

286,438

A L L COMMERCIAL BANKING INSTITUTIONS2

Assets
1 Loans and securities
Investment securities
7
U.S. government securities
4
Other
5 Trading account assets
6
U.S. government securities
7
Other securities
8
Other trading account assets
9
10
11
Loans excluding interbank
1?
N
Real estate
Revolving home equity
14
IS
Other
Individual
16
17
All other
18 Total cash assets
19
Balances with Federal Reserve Banks
70
Cash in vault
71
Demand balances at U.S. depository institutions . .
77

11,363

Liabilities
76

77
78
79
30
31
V

Demand, U.S. government
Demand, depository institutions
Other demand and all checkable deposits
Savings deposits (excluding checkable)
Small time deposits
Time deposits over $100,000

34
35
Treasury tax and loan notes
36
Other
37 Other liabilities
38 Total liabilities
39 Residual (assets less liabilities)

3

Footnotes appear on following page.




12,612

283,299

Commercial Banking Institutions
1.26 ASSETS AND LIABILITIES OF COMMERCIAL BANKS 1

A21

Wednesday figures—Continued

Millions of dollars

Account
May 5 r

May 12r

May 191

May 26 r

June 2

June 9

June 16

June 23

June 30

Assets
40 Loans and securities
41
Investment securities
42
U.S. government securities
43
Other
44
Trading account assets
45
U.S. government securities
46
Other securities
47
Other trading account assets
48
Total loans
49
Interbank loans
50
Loans excluding interbank
51
Commercial and industrial
52
Real estate
53
Revolving home equity
54
Other
55
Individual
56
All other
57 Total cash assets
58
Balances with Federal Reserve Banks
59
Cash in vault
60
Demand balances at U.S. depository institutions .
61
Cash items
62
Other cash assets
63 Other assets

2,781,597
761,059
620,722
140,337
39,679
25,640
2,676
11,363
1,980,860
130,299
1,850,561
441,791
842,326
74,339
767,988
362,371
204,073
185,189
28,808
29,328
30,599
79,796
16,658
177,655

2,779,891
762,531
622,008
140,524
36,011
22,142
2,488
11,382
1,981,349
128,086
1,853,263
439,602
846,215
74,416
771,799
363,258
204,189
188,209
34,279
31,542
28,711
76,633
17,044
177,060

2,774,645
759,952
619,484
140,467
40,591
25,330
2,649
12,612
1,974,102
126,334
1,847,768
438,991
844,241
74,382
769,859
363,719

2.770.751
756,870
617,159
139,710
36,429
21,413
2,844
12,173
1,977,452
129,700
1.847.752
439,371
845,217
74,500
770,718
364,875
198,289
190,206
37,487
32,579
29,231
72,811
170,075

2,804,229
766,639
626,386
140,253
43,947
28,805
2,405
12,737
1,993,643
133,279
1,860,363
441,019
849,283
74,505
774,778
365,216
204,846
213,525
27,234
32,778
34,509
99,367
19,637
185,079

2,811,430
768,815
628,146
140,669
43,587
27,421
2,495
13,671
1,999,028
137,455
1,861,573
438,261
851,500
74,449
777,051
364,449
207,364
185,042
26,404
32,229
30,665
77,012
18,731
176,409

2,821,731
765,833
625,030
140,804
43,448
27,598
2,296
13,554
2,012,450
143,350
1,869,100
439,886
852,007
74,867
777,140
364,106
213,101
189,556
26,046
32,176
30,471
81,286
19,578
181,623

2,787,725
765,722
624,891
140,831
45,503
29,153
2,619
13,730
1,976,501
123,137
1,853,364
438,002
849,690
74,757
774,933
365,019
200,652
182,077
32,034
32,401
28,549
71,153
17,941
180,214

2,797,738
767,445
626,741
140,704
33,814
19,088
2,732
11,993
1,996,480
128,582
1,867,898
439,875
855,085
74,822
780,263
366,472
206,466
188,878
23,018
33,119
29,012
83,793
19,936
181,760

64 Total assets

3,144,441

3,145,159

3,122,396

3,131,032

3,202,833

3,172,881

3,192,910

3,150,017

3,168,376

2,357,417
763,345
3,564
37,422
722,359
756,572
619,332
370,377
18,546
351,831
137,965

2,345,383
749,048
3,010
35,829
710,209
759,570
618,617
218,149
378,521
14,143
364,378
140,6%

2,325,554
737,255
3,133
35,225
698,897
754,516
617,215
216,567
380,727
16,620
364,107
136,034

2,328,358
742,161
3,331
36,161
702,669
754,007
615,933
216,258
382,237
14,738
367,499
140,464

2,393,450
796,570
4,225
42,890
749,455
764,751
616,090
216,041
385,843
18,785
367,058
141,057

2,366,149
766,543
3,501
36,292
726,751
768,571
614,565
216,471
383,537
4,890
378,647
138,885

2,375,030
780,226
7,486
37,022
735,718
765,932
614,778
214,094
400,881
30,676
370,205
134,635

2,316,782
736,364
3,160
34,825
698,379
756,587
612,929
210,901
414,353
35,240
379,113
135,941

2,353,649
782,531
4,280
35,323
742,928
754,999
613,332
202,787
385,9%
31,241
354,755
145,511

2,865,759

2,864,599

2,842,315

2,851,059

2,920,350

2,888,571

2,910,546

2,867,075

2,885,156

278,683

280,559

280,082

279,973

282,483

284,310

282,364

282,941

283,220

DOMESTICALLY CHARTERED COMMERCIAL BANKS4

Liabilities
65 Total deposits
66
Transaction accounts
67
Demand, U.S. government
68
Demand, depository institutions
69
Other demand and all checkable deposits
70
Savings deposits (excluding checkable)
71
Small time deposits
72
Time deposits over $100,000
73 Borrowings
74
Treasury tax and loan notes
75
Other
76 Other liabilities
77 Total liabilities
78

Residual (assets less liabilities)

3

218,168

1. Excludes assets and liabilities of international banking facilities.
2. Includes insured domestically chartered commercial banks, agencies and
branches of foreign banks, Edge Act and agreement corporations, and New York
State investment corporations majority owned by foreign banks. Data are estimates
for the last Wednesday of the month based on a sample of weekly reporting
foreign-related and domestic institutions and quarter-end condition reports.




200,818

174,171
24,195
31,774
28,581
71,901
17,721
173,580

18,100

3. This balancing item is not intended as a measure of equity capital for use in
capital-adequacy analysis.
4. Includes all member banks and insured nonmember banks. Loans and
securities data are estimates for the last Wednesday of the month based on a
sample of weekly reporting banks and quarter-end condition reports.

A22

DomesticNonfinancialStatistics • September 1993

1.27 ASSETS AND LIABILITIES OF LARGE WEEKLY REPORTING COMMERCIAL BANKS
Millions of dollars, Wednesday figures
1993
Account
May 5

May 12

May 19

106,657
291,533 r
23,455
268,077 r
84,170 r

110,686
287,911"
19,998
267,913"
83,720"

97,947
289,761"
23,059
266,703"
81,567"

113,587
284,656"
19,204
265,451"
81,776"

123,642
298,769
26,418
272,351
82,991

107,686
297,489
25,254
272,235
83,204

110,042
294,662
24,990
269,672
82,957

106,219
295,586
26,847
268,739
82,918

106,087
287,115
17,023
270,092
84,036

42,333 r
73,628 r
67,947 r
55,819"
2,492
53,328 r
19,777r
3,410"
16,367
33,551
11,240

43,283"
73,818"
67,092"
55,847"
2,303
53,544"
19,808"
3,455"
16,354"
33,735"
11,258

45,217"
73,738"
66,182"
55,889"
2,466
53,423"
19,814
3,447"
16,367"
33,609"
12,490

44,830"
74,386"
64,460"
55,644"
2,666
52,978"
19,828
3,467"
16,361"
33,150"
12,052

46,785
74,058
68,517
55,637
2,230
53,407
19,699
3,366
16,332
33,709
12,628

47,567
73,959
67,505
55,893
2,319
53,575
19,754
3,428
16,326
33,820
13,561

48,490
71,471
66,755
55,829
2,118
53,711
19,780
3,455
16,325
33,932
13,434

47,526
71,551
66,744
56,077
2,443
53,635
19,800
3,471
16,329
33,835
13,608

45,486
70,477
70,093
56,305
2,556
53,749
19,387
3,206
16,181
34,362
11,872

86,252
53,820
26,538
5,893
978,479"
277,523"
3,090
274,433"
272,836"
1,597
395,631"
43,855"
351,776"
185,356"
35,189
12,072
2,385
20,731
16,150"
5,648
13,777
1,522
23,142"
24,541
2,084
36,447
939,948"
164,251"

85,455"
53,475
26,309"
5,670
980,072"
275,709"
3,045
272,665"
271,098"
1,567
398,030"
43,847"
354,183"
185,627
34,854
11,954
2,431
20,470
16,882"
5,639
13,671
1,380
23,735"
24,545
2,086
36,384
941,602"
164,605"

81,413
52,407
24,746
4,259
978,955"
275,228"
3,079
272,149"
270,644"
1,505
395,859"
43,851"
352,008"
186,093
35,793
13,153
2,629
20,011
16,752"
5,688
14,082
1,344
23,543"
24,574
2,094
36,401
940,459"
162,104"

81,305
55,686
20,464
5,156
982,237"
275,761"
3,134
272,626"
271,039"
1,587
396,189"
43,904"
352,285"
186,766
36,703
13,863
2,479
20,361
16,602"
5,6%
14,053
1,339
24,439"
24,689
2,084
36,313
943,840"
159,492"

86,571
56,298
24,309
5,965
987,201
277,115
3,150
273,964
272,316
1,648
398,365
43,763
354,602
186,414
39,574
14,641
3,358
21,574
14,813
5,755
14,001
1,550
24,878
24,737
2,039
36,579
948,584
169,972

92,486
58,088
27,353
7,045
983,486
274,713
3,238
271,475
269,741
1,734
400,463
43,696
356,767
185,367
38,385
14,428
2,224
21,733
15,441
5,737
13,859
1,430
23,319
24,772
2,057
36,657
944,772
165,032

103,490
64,049
31,870
7,571
986,607
276,343
3,198
273,144
271,312
1,833
400,332
44,018
356,314
186,497
37,161
14,594
2,220
20,347
16,220
5,743
13,853
1,350
24,334
24,773
2,057
36,634
947,915
171,617

84,676
53,995
23,612
7,068
981,078
275,029
2,801
272,228
270,416
1,812
398,515
43,942
354,573
187,445
35,384
13,412
2,240
19,733
16,134
5,750
13,700
1,339
23,020
24,760
2,048
36,413
942,616
169,503

83,827
57,389
20,459
5,978
995,567
276,631
2,993
273,638
271,805
1,833
401,2%
43,921
357,376
188,255
37,715
14,225
2,606
20,884
19,250
5,799
13,695
1,451
26,580
24,897
2,111
35,618
957,838
167,682

1,655,70^ 1,657,363' 1,640,064' 1,650,576'

1,695,803

1,676,920

1,696,989

1,668,287

1,670,726

May 26

June 2

June 9

June 16

June 23

June 30

ASSETS

1 Cash and balances due from depository institutions
2 U.S. Treasury and government securities
3
Trading account
4
Investment account
5
Mortgage-backed securities'
All others, by maturity
6
One year or less
7
One year through five years
8
More than five years
9 Other securities
Trading account
10
11
Investment account
12
State and political subdivisions, by maturity
13
One year or less
14
More than one year
15
Other bonds, corporate stocks, and securities
16 Other trading account assets
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44

Federal funds sold 2
To commercial banks in the United States
To nonbank brokers and dealers
To others 3
Other loans and leases, gross
Commercial and industrial
Bankers acceptances and commercial paper
All other
U.S. addressees
Non-U.S. addressees
Real estate loans
Revolving, home equity
All other
To individuals for personal expenditures
To financial institutions
Commercial banks in the United States
Banks in foreign countries
Nonbank financial institutions
For purchasing and carrying securities
T o finance agricultural production
To states and political subdivisions
To foreign governments and official institutions
All other loans 4
Lease-financing receivables
LESS: Unearned income
Loan and lease reserve 5
Other loans and leases, net
Other assets

45 Total assets

Footnotes appear on the following page.




Weekly Reporting

Commercial

Banks

A23

1.27 ASSETS AND LIABILITIES OF LARGE WEEKLY REPORTING COMMERCIAL BANKS—Continued
Millions of dollars, Wednesday figures
1993
Account
May 5

May 12

May 19

May 26

June 2

June 9

June 16

June 23

June 30

l,102,573 r
269,142 r
217,932 r
51,210"^
8,925
2,162
22,306 r
5,591
631
11,596
116,411
717,021
690,682
26,339
21,539
2,270
2,191
339

1,142,493
296,175
239,334
56,842
9,555
2,572
26,994
5,940
852
10,928
121,241
725,077
698,526
26,551
21,338
2,653
2,235
325

1,125,960
278,548
227,108
51,440
8,407
2,275
23,404
4,658
550
12,146
120,320
727,093
700,562
26,531
21,351
2,635
2,218
327

1,135,524
289,747
234,529
55,217
9,195
5,414
23,431
5,199
658
11,321
120,711
725,066
699,247
25,819
20,556
2,678
2,260
325

1,092,820
263,260
213,379
49,881
9,559
2,016
21,870
4,962
597
10,876
116,093
713,467
688,308
25,158
20,253
2,688
1,894
324

1,114,637
290,932
240,455
50,477
9,023
2,461
21,771
5,406
768
11,048
118,545
705,160
684,496
20,664
18,352
498
1,488
326

295,427
0
16,728
278,699

294,764
0
3,676
291,087

308,635
0
27,515
281,120

321,194
0
31,458
289,736

292,782
1,260
27,483
264,039

LIABILITIES

l,121,675 r l,113,712 r l,099,371 r
46 Deposits
276,877"
271,015 r
263,537 r
47
Demand deposits
225,207 r
222,007 r
215,363 r
Individuals, partnerships, and corporations
48
r
51,670"
49,008
48,174 r
49
Other holders
10,049
8,652
9,093
50
States and political subdivisions
2,130
1,795
1,879
51
U.S. government
23,308 r
21,415 r
22,280 r
Depository institutions in the United States
52
5,639
5,163
5,191
53
Banks in foreign countries
652
615
749
Foreign governments and official institutions
54
9,891
10,502
9,847
55
Certified and officers' checks
119,701
117,197
116,916
56
Transaction balances other than demand deposits 4
725,097
725,499
718,918
Nontransaction balances
57
699,585
699,429"
692,816
58
Individuals, partnerships, and corporations
25,512
26,070
26,101
59
Other holders
20,750
21,364
21,399
60
States and political subdivisions
2,200
2,206
2,211
61
U.S. government
2,229
2,159
2,152
Depository institutions in the United States
62
333
341
339
Foreign governments, official institutions, and banks . . . .
63
64 Liabilities for borrowed money 5
65
Borrowings from Federal Reserve Banks
66
Treasury tax and loan notes
67
Other liabilities for borrowed money
68 Other liabilities (including subordinated notes and
debentures)
69 Total liabilities
70 Residual (total assets less total liabilities) 7

280,649
0
16,196
264,453
106,865
l,509,189 r
146,512

MEMO

71
7?
73
74
75
76
77

Total loans and leases, gross, adjusted, plus securities . . 1,357,430"r
109,684
Time deposits in amounts of $100,000 or more
871
Loans sold outright to affiliates 9
442
Commercial and industrial
428
Other
23,333 r
Foreign branch credit extended to U.S. residents 10
-ll,323r
Net owed to related institutions abroad

287,083
0
12,268
274,815

288,744
0
14,391r
274,353

292,143
0
12,779"
279,365 r

109,333r

104,660

109,029

109,460

107,170

103,375

104,493

114,033

1,510,128r 1,492,775" l,503,745 r

1,547,380

1,527,894

1,547,534

1,518,507

1,521,452

148,422

149,026

149,455

149,780

149,274

1,369,867
107,739
862
437
425
23,715
-15,779

1,370,399
108,161
863
437
426
23,320
-15,072

1,375,379
106,118
854
430
425
23,026
-23,926

1,363,619
103,453
853
428
425
22,929
-20,377

1,363,072
96,471
813
411
402
22,643
-9,667

147,236
1,355,113r
109,258r
867
438
428
23,547 r

-9,oor

1. Includes certificates of participation, issued or guaranteed by agencies of the
U.S. government, in pools of residential mortgages.
2. Includes securities purchased under agreements to resell.
3. Includes allocated transfer risk reserve.
4. Includes negotiable order of withdrawal accounts (NOWs), automatic transfer service (ATS), and telephone and preauthorized transfers of savings deposits.
5. Includes borrowings only from other than directly related institutions.
6. Includes federal funds purchased and securities sold under agreements to
repurchase.
7. This balancing item is not intended as a measure of equity capital for use in
capital-adequacy analysis.
8. Excludes loans to and federal funds transactions with commercial banks in
the United States.




147,289

146,831

l,352,948 r l,346,345 r
108,008r
107,680"
866
864
437
437
428
426
23,250""
23,118 r
-13,967 r
-10,039"

9. Affiliates include a bank's own foreign branches, nonconsolidated nonbank
affiliates of the bank, the bank's holding company (if not a bank), and nonconsolidated nonbank subsidiaries of the holding company.
10. Credit extended by foreign branches of domestically chartered weekly
reporting banks to nonbank U.S. residents. Consists mainly of commercial and
industrial loans, but includes an unknown amount of credit extended to other than
nonfinancial businesses.
NOTE. Data that formerly appeared in table 1.28, Assets and Liabilities of Large
Weekly Reporting Commercial Banks in New York City, can be obtained from the
Board's H.4.2 (504) weekly statistical release. For ordering address, see inside
front cover.

A24

DomesticNonfinancialStatistics • September 1993

1.28 LARGE WEEKLY REPORTING U.S. BRANCHES AND AGENCIES OF FOREIGN BANKS
Liabilities1

Assets and

Millions of dollars, Wednesday figures
1993
Account
May 5
1 Cash and balances due from depository
institutions
2 U.S. Treasury and government agency
securities
3 Other securities
4 Federal funds sold'
5
To commercial banks in the United States . . .
6
To others 2
7 Other loans and leases, gross
8
Commercial and industrial
9
Bankers acceptances and commercial
paper
10
All other
11
U . S . addressees
12
Non-U.S. addressees
Loans secured by real estate
13
14
To financial institutions
15
Commercial banks in the United S t a t e s . .
16
Banks in foreign countries
17
Nonbank financial institutions
For purchasing and carrying securities
18
19
To foreign governments ana official
institutions
70
All other
21 Other assets (claims on nonrelated parties) . .
22 Total assets3
23 Deposits or credit balances owed to other
than directly related institutions
24 Demand deposits
25
Individuals, partnerships, and
corporations
76
Other
27 Nontransaction accounts
28
Individuals, partnerships, and
corporations
29
Other
30 Borrowings from other than directly
related institutions . ,
31 Federal funds purchased
32
From commercial banks in the
United States
33
From others
34 Other liabilities for borrowed money
35
To commercial banks in the
United States
36
To others
37 Other liabilities to nonrelated parties
38 Total liabilities6
MEMO

39 Total loans (gross) and securities, a d j u s t e d 7 . .
40 Net owed to related institutions abroad

May 12

May 19

June 2

June 9

June 16

June 23

June 30

17,361

17,608

16,845

17,458

17,694

18,839

18,181

18,974

19,843

30,723
8,988 r
18,481
3,872
14,609
158,085r
95,381 r

29,924
9,073 r
20,572
5,889
14,683
159,484r
95.8071

29,750
9,049 r
21,077
5,341
15,736
160,190*
96,548 r

30,099
8,804"
22,557
5,585
16,973
159,426"
96,326"

31,259
8,436
22,070
5,269
16,802
161,940
98,110

31,131
8,001
24,960
7,740
17,220
160,545
97,113

31,405
7,470
25,446
3,592
21,854
162,054
97,739

30,592
7,740
28,861
7,436
21,426
161,073
97,562

31,572
8,665
27,808
7,570
20,238
163,676
98,074

2,549
92,831 r
89,596 r
3,235 r
32,201 r
23,875 r
5,360
1,732
16,783r
3,375

2,474
93,333 r
89,992 r
3,342
32,068 r
24,950 r
5,392
1,722
17,836r
3,533

2,612
93,936 r
90,508 r
3,428
32,020 r
25,139""
5,268
1,740
18,131r
3,491

2,594
93,732"
90,454"
3,278
32,035"
25,094"
5,453
1,810
17,832"
2,965

2,718
95,392
92,075
3,317
31,847
25,693
5,205
1,920
18,567
3,299

2,574
94,539
91,261
3,277
31,858
25,237
5,417
1,788
18,032
3,332

2,525
95,214
91,845
3,368
31,889
26,285
5,602
1,901
18,782
3,130

2,463
95,099
91,745
3,353
31,627
25,618
5,618
1,997
18,004
3,105

2,520
95,554
92,288
3,266
31,471
26,637
5,840
2,026
18,772
4,574

389
2,863 r
33,359 r

372
2,753
32,015 r

340
2,651
31,820"

375
2,630
32,176"

372
2,619
31,293

372
2,632
31,698

378
2,633
30,654

459
2,702
30,558

401
2,518
31,428

297,935

297,323

301,790

301,975

308,469

309,608

309,015

306,735

314,715

101,440
3,961

101,271
4,396

101,527
3,829

102,538
4,130

103,993
4,149

102,021
4,359

103,491
3,956

103,969
3,849

102,617
4,951

3,134
827
97,479

3,111
1,285
96,875

3,056
774
97,698

3,332
798
98,408

3,088
1,061
99,844

2,915
1,444
97,662

2,968
987
99,536

3,060
789
100,121

4,057
895
97,665

68,601
28,878

68,173
28,702

68,175
29,523

68,352
30,057

69,517
30,327

67,898
29,763

68,720
30,816

69,144
30,977

67,650
30,016

85,582
44,173

81,673
39,990

86,786
42,050

82,644
38,777

87,088
42,527

92,885
45,760

92,669
51,026

82,619
41,608

88,518
50,151

13,997
30,176
41,409

11,530
28,460
41,683

13,393
28,657
44,735

13,528
25,249
43,867

14,494
28,033
44,562

16,449
29,311
47,125

18,569
32,457
41,643

10,884
30,724
41,011

18,568
31,582
38,367

7,363
34,046
30,691

6,871
34,812
31,295

7,533
37,202
30,095

8,064
35,803
30,533

7,848
36,713
30,358

8,125
39,000
30,158

8,000
33,643
28,643

7,954
33,057
29,430

8,464
29,903
31,619

297,935

297,323

301,790

301,975

308,469

309,608

309,015

306,735

314,715

207,045 r
49,283

207,771 r
54,437

209,457"
50,323

209,849"
54,806

213,231
51,253

211,480
50,110

217,183
50,408

215,212
61,780

218,310
60,237

1. Includes securities purchased under agreements to resell.
2. Includes transactions with nonhank brokers and dealers in securities.
3. Includes net due from related institutions abroad for U.S. branches and
agencies of foreign banks having a net " d u e f r o m " position.
4. Includes other transaction deposits.




May 26

5. Includes securities sold under agreements to repurchase.
6. Includes net owed to related institutions abroad for U.S. branches and
agencies of foreign banks having a net " d u e t o " position.
7. Excludes loans to and federal funds transactions with commercial banks in
the United States.

Financial Markets

A25

1.32 COMMERCIAL PAPER AND BANKERS DOLLAR ACCEPTANCES OUTSTANDING
Millions of dollars, end of period
Year ending December

1993

1992

Item
1988

1989

1991

1990

1992

Dec.

Jan.

Feb.

Mar.

Apr.

May

Commercial paper (seasonally adjusted unless noted otherwise)
1 All issuers.
Financial companies
Dealer-placed
paper
Total
Bank-related (not seasonally
adjusted) 3
Directly placed paper
Total ,
Bank-related (not seasonally
adjusted)

458,464

525,831

562,656

531,724

549,433

549,433

540,198 r

527,531 r

534,118'

535,966 r

541,671

159,777

183,622

214,706

213,823

228,260

228,260

212,682 r

202,046 r

218,925 r

210,230 r

214,558

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

183,379

172,813

172,813

181,264

177,370

171,959

175,384

174,468

n.a.

n.a.

194,931

210,930

200,036

43,155

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

131,279

147,914

134,522

148,360

148,360

146,252r

148,115r

143,234r

150,352r

152,645

1,248

103,756

6 Nonfinancial companies

Bankers dollar acceptances (not seasonally adjusted) 6
7 Total

66,631

62,972

54,771

43,770

38,200

38,200

36,001

35,221

34,939

35,317

34,864

By holder
8 Accepting b a n k s .
9
Own bills
10
Bills bought from other banks .
Federal Reserve Banks 7
11
Foreign correspondents.
12 Others

9,086
8,022
1,064

9,433
8,510
924

9,017
7,930
1,087

11,017
9,347
1,670

10,561
9,103
1,458

10,561
9,103
1,458

9,121
7,927
1,193

9,878
8,361
1,516

11,036
9,162
1,873

10,688r
9,315 r
l,372 r

10,934
9,624
1,310

1,493
56,052

1,066
52,473

918
44,836

1,739
31,014

1,276
26,364

1,276
26,364

1,317
25,563

1,169
24,175

1,108
22,795

909
23,720 r

690
23,239

By basis
13 Imports into United States . .
14 Exports from United States .
15 All other

14,984
14,410
37,237

15,651
13,683
33,638

13,095
12,703
28,973

12,843
10,351
20,577

12,212
8,096
17,893

12,212
8,0%
17,893

11,148
7,740
17,112

11,126
7,547
16,548

11,129
7,304
16,506

10,746
7,629
16,942

10,2%
7,901
16,667

1. Institutions engaged primarily in commercial, savings, and mortgage banking; sales, personal, and mortgage financing; factoring, finance leasing, and other
business lending; insurance underwriting; and other investment activities.
2. Includes aU financial-company paper sold by dealers in the open market.
3. Series were discontinued in January 1989.
4. As reported by financial companies that place their paper directly with
investors.

1.33 PRIME RATE CHARGED BY BANKS

5. Includes public utilities and firms engaged primarily in such activities as
communications, construction, manufacturing, mining, wholesale and retail trade,
transportation, and services.
6. Data on bankers dollar acceptances are gathered from approximately 100
institutions. The reporting group is revised every January.
7. In 1977 the Federal Reserve discontinued operations in bankers dollar
acceptances for its own account.

Short-Term Business Loans1

Percent per year
Average
rate

1990— Jan.
1991— Jan.
Feb.
May
Sept.
Nov.
Dec.
1992— July

1
8

10.50
10.00

2
4
1
13
6
23

9.50
9.00
8.50
8.00
7.50
6.50

2

6.00

1990
1991
1992
1990—Jan.
Feb.
Mar.
Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.

10.01

8.46
6.25

10.11
10.00

10.00
10.00
10.00

10.00
10.00
10.00
10.00

10.00
10.00
10.00

1. Data in this table also appear in the Board's H.15 (519) weekly and G.13
(415) monthly statistical releases. For ordering address, see inside front cover.




Average
rate

1991—Jan. .
Feb.
Mar.
Apr.
May
June
July .
Aug.
Sept.
Oct.
Nov.
Dec.

9.52
9.05
9.00
9.00
8.50
8.50
8.50
8.50
8.20
8.00
7.58
7.21

1992—Jan. .
Feb.
Mar.
Apr.

6.50
6.50
6.50
6.50

Period

1992— May .
June
July .
Aug.
Sept
Oct.
Nov.
Dec.
1993—Jan. .
Feb
Mar.
Apr.
May
June
July .

A26
1.35

DomesticNonfinancialStatistics • September 1993
INTEREST RATES

M o n e y and Capital Markets

Averages, percent per year; figures are averages of business day data unless otherwise noted
1993
1990

Item

1991

1993, week ending

1992
Mar.

Apr.

May

June

May 28

June 4

June 11

June 18

June 25

MONEY MARKET INSTRUMENTS

Federal funds 1 2 - 3
2 Discount window borrowing

8.10
6.98

5.69
5.45

3.52
3.25

3.07
3.00

2.%
3.00

3.00
3.00

3.04
3.00

3.07
3.00

3.09
3.00

2.96
3.00

3.01
3.00

3.00
3.00

8.15
8.06
7.95

5.89
5.87
5.85

3.71
3.75
3.80

3.15
3.17
3.24

3.13
3.14
3.19

3.11
3.14
3.20

3.19
3.25
3.38

3.15
3.19
3.30

3.18
3.23
3.34

3.20
3.28
3.41

3.18
3.24
3.34

3.20
3.26
3.39

8.00
7.87
7.53

5.73
5.71
5.60

3.62
3.65
3.63

3.15
3.17
3.14

3.06
3.06
3.07

3.05
3.07
3.07

3.12
3.16
3.16

3.09
3.13
3.13

3.07
3.15
3.15

3.15
3.19
3.17

3.12
3.14
3.15

3.14
3.15
3.15

7.93
7.80

5.70
5.67

3.62
3.67

3.07
3.14

3.05
3.10

3.06
3.13

3.16
3.28

3.12
3.23

3.16
3.28

3.21
3.33

3.13
3.25

3.16
3.28

8.15
8.15
8.17

5.82
5.83
5.91

3.64
3.68
3.76

3.10
3.11
3.20

3.08
3.09
3.16

3.07
3.10
3.20

3.13
3.21
3.36

3.10
3.16
3.29

3.11
3.21
3.35

3.16
3.25
3.42

3.10
3.17
3.30

3.13
3.21
3.35

8.16

5.86

3.70

3.11

3.10

3.12

3.21

3.20

3.21

3.25

3.19

3.21

7.50
7.46
7.35

5.38
5.44
5.52

3.43
3.54
3.71

2.95
3.05
3.20

2.87
2.97
3.11

2.96
3.07
3.23

3.07
3.20
3.39

3.06
3.20
3.39

3.06
3.21
3.44

3.10
3.26
3.46

3.05
3.16
3.33

3.09
3.19
3.37

7.51
7.47
7.36

5.42
5.49
5.54

3.45
3.57
3.75

2.97
3.08
3.09

2.89
3.00
3.24

2.%
3.07
3.13

3.10
3.23
3.40

3.06
3.19
n.a.

3.08
3.22
3.40

3.14
3.30
n.a.

3.07
3.19
n.a.

3.10
3.19
n.a.

7.89
8.16
8.26
8.37
8.52
8.55
8.61

5.86
6.49
6.82
7.37
7.68
7.86
8.14

3.89
4.77
5.30
6.19
6.63
7.01
7.67

3.33
3.95
4.40
5.19
5.66
5.98
6.82

3.24
3.84
4.30
5.13
5.59
5.97
6.85

3.36
3.98
4.40
5.20
5.66
6.04
6.92

3.54
4.16
4.53
5.22
5.61
5.%
6.81

3.55
4.21
4.60
5.36
5.78
6.14
6.97

3.58
4.20
4.58
5.29
5.70
6.07
6.88

3.61
4.27
4.65
5.32
5.70
6.06
6.87

3.49
4.11
4.50
5.19
5.59
5.%
6.82

3.53
4.15
4.50
5.18
5.56
5.89
6.76

8.74

8.16

7.52

6.65

6.64

6.68

6.55

6.75

6.65

6.63

6.55

6.48

6.96
7.29
7.27

6.56
6.99
6.92

6.09
6.48
6.44

5.42
5.81
5.64

5.47
5.88
5.76

5.47
5.88
5.73

5.35
5.80
5.63

5.66
6.09
5.73

5.33
5.78
5.67

5.42
5.86
5.68

5.33
5.80
5.61

5.41
5.86
5.57

9.77

9.23

8.55

7.83

7.76

7.78

7.66

7.82

7.74

7.72

7.66

7.61

33
34 Aa
35 A
36 Baa

9.32
9.56
9.82
10.36

8.77
9.05
9.30
9.80

8.14
8.46
8.62
8.98

7.58
7.72
7.86
8.15

7.46
7.62
7.80
8.14

7.43
7.61
7.85
8.21

7.33
7.51
7.74
8.07

7.46
7.64
7.89
8.27

7.39
7.58
7.82
8.16

7.38
7.57
7.81
8.13

7.32
7.50
7.74
8.06

7.29
7.46
7.69
8.01

37 A-rated, recently offered utility bonds 16

10.01

9.32

8.52

7.61

7.66

7.75

7.59

7.77

7.69

7.59

7.58

7.48

8.%
3.61

8.17
3.24 r

7.46
2.99

6.70
2.76

6.69
2.82

6.65
2.77

6.97
2.81

6.74
2.77

6.78
2.77

7.05
2.82

7.03
2.82

6.99
2.84

1

,4

paper3,5,6

3
4
5

Commercial
1-month
3-month
6-month

6
7
8

Finance paper, directly
1-month
3-month
6-month

9
10

Bankers
acceptances3,5,8
3-month
6-month

11
12
13

Certificates of deposit,
marker'9
1-month
3-month
6-month

placed3,5,1

secondary

14 Eurodollar deposits, 3-month 3 , 1 0

18
19
20

U.S. Treasury bills
Secondary market '
3-month
6-month
1-year
Auction average ' '
3-month
6-month
1-year

21
22
23
24
25
26
27

Constant
maturities12
1-year
2-year
3-year
5-year
7-year
10-year
30-year

15
16
17

U . S . TREASURY N O T E S AND B O N D S

Composite
28 More than 10 years (long-term)
STATE AND LOCAL NOTES AND BONDS

Moody's series13
29
30 Baa
31 Bond Buyer series
CORPORATE B O N D S

32 Seasoned issues, all industries 15
Rating

group

MEMO

Dividend-price
ratio
38 Preferred stocks
39 Common stocks

1. The daily effective federal funds rate is a weighted average of rates on
trades through New York brokers.
2. Weekly figures are averages of seven calendar days ending on Wednesday
of the current week; monthly figures include each calendar day in the month.
3. Annualized using a 360-day year or bank interest.
4. Rate for the Federal Reserve Bank of New York.
5. Quoted on a discount basis.
6. An average of offering rates on commercial paper placed by several leading
dealers for firms whose bond rating is AA or the equivalent.
7. An average of offering rates on paper directly placed by finance companies.
8. Representative closing yields for acceptances of the highest-rated money
center banks.
9. An average of dealer offering rates on nationally traded certificates of
deposit.
10. Bid rates for Eurodollar deposits at 11 a.m. London time. Data are for
indication purposes only.
11. Auction date for daily data; weekly and monthly averages computed on an
issue-date basis.




12. Yields on actively traded issues adjusted to constant maturities. Source:
U.S. Treasury.
13. General obligations based on Thursday figures; Moody's Investors Service.
14. General obligations only, with twenty years to maturity, issued by twenty
state and local governmental units of mixed quality. Based on figures for
Thursday.
15. Daily figures from Moody's Investors Service. Based on yields to maturity
on selected long-term bonds.
16. Compilation of the Federal Reserve. This series is an estimate of the yield
on recently offered, A-rated utility bonds with a thirty-year maturity and five
years of call protection. Weekly data are based on Friday quotations.
17. Standard & Poor's corporate series. Preferred stock ratio is based on a
sample of ten issues: four public utilities, four industrials, one financial, and one
transportation. Common stock ratio is based on the 500 stocks in the price index.
NOTE. Data in this table also appear in the Board's H.15 (519) weekly and G.13
(415) monthly statistical releases. For ordering address, see inside front cover.

Financial Markets
1.36 STOCK MARKET

All

Selected Statistics
1993

1992
Indicator

1990

1991

1992
Oct.

Nov.

Dec.

Feb.

Jan.

Mar.

Apr.

May

June

Prices and trading volume (averages of daily figures)
Common stock prices (indexes)
1 New York Stock Exchange
(Dec. 31, 1965 = 50)
2
Industrial
3
Transportation
4
Utility
5
Finance

183.66
226.06
158.80
90.72
133.21

206.35
258.16
173.97
92.64
150.84

229.00
284.26
201.02
99.48
179.29

226.97
279.70
192.30
101.62
181.36

232.84
287.80
204.63
101.13
189.27

239.47
290.77
212.35
103.85
196.87

239.75
292.11
221.00
105.52
203.38

243.41
294.40
226.96
109.45
209.93

248.12
298.75
229.42
112.53
217.01

244.72
292.19
237.97
113.78
216.02

246.02
297.83
237.80
111.21
209.40

247.16
298.78
234.30
113.27
209.75

6 Standard & Poor's Corporation
(1941-43 = 10)'

335.01

376.20

415.75

412.50

422.84

435.64

435.40

441.76

450.15

443.08

445.25

448.06

7 American Stock Exchange
(Aug. 31, 1973 = 50F

338.32

360.32

391.28

371.27

387.75

392.69

402.75

409.39

418.56

418.54

429.72

436.13

156,359
13,155

179,411
12,486

202,558
14,171

204,787
11,966

208,221
14,925

222,736
16,523

266,011
17,184

288,540
18,154

251,170
16,150

279,778
15,521

255,843
20,433

250,230
17,744

Volume of trading (thousands of shares)
8 New York Stock Exchange
9 American Stock Exchange

Customer financing (millions of dollars, end-of-period balances)
10 Margin credit at broker-dealers 3

28,210

36,660

43,990

41,590

43,630

43,990

44,020

44,290

45,160

47,420

48,630

49,550

Free credit balances at brokers*
11 Margin accounts 5
12 Cash accounts

8,050
19,285

8,290
19,255

8,970
22,510

8,355
18,700

8,500
19,310

8,970
22,510

8,980
20,360

9,790
22,190

9,650
21,395

9,805
21,450

9,560
21,610

9,820
22,625

Margin requirements (percent of market value and effective date) 6

13 Margin stocks
14 Convertible bonds
15 Short sales

Mar. 11, 1968

June 8, 1968

May 6, 1970

Dec. 6, 1971

Nov. 24, 1972

Jan. 3, 1974

70
50
70

80
60
80

65
50
65

55
50
55

65
50
65

50
50
50

1. Effective July 1976, includes a new financial group, banks and insurance
companies. With this change the index includes 400 industrial stocks (formerly
425), 20 transportation (formerly 15 rail), 40 public utility (formerly 60), and 40
financial.
2. On July 5,1983, the American Stock Exchange rebased its index, effectively
cutting previous readings in half.
3. Since July 1983, under the revised Regulation T, margin credit at brokerdealers has included credit extended against stocks, convertible bonds, stocks
acquired through the exercise of subscription rights, corporate bonds, and
government securities. Separate reporting of data for margin stocks, convertible
bonds, and subscription issues was discontinued in April 1984.
4. Free credit balances are amounts in accounts with no unfulfilled commitments to brokers and are subject to withdrawal by customers on demand.
5. New series since June 1984.
6. These requirements, stated in regulations adopted by the Board of Governors pursuant to the Securities Exchange Act of 1934, limit the amount of credit
that can be used to purchase and carry "margin securities" (as defined in the
regulations) when such credit is collateralized by securities. Margin requirements




on securities other than options are the difference between the market value (100
percent) and the maximum loan value of collateral as prescribed by the Board.
Regulation T was adopted effective Oct. 15, 1934; Regulation U , effective May 1,
1936; Regulation G, effective Mar. 11, 1968; and Regulation X, effective Nov. 1,
1971.
On Jan. 1, 1977, the Board of Governors for the first time established in
Regulation T the initial margin required for writing options on securities, setting
it at 30 percent of the current market value of the stock underlying the option. On
Sept. 30,1985, the Board changed the required initial margin, allowing it to be the
same as the option maintenance margin required by the appropriate exchange or
self-regulatory organization; such maintenance margin rules must be approved by
the Securities and Exchange Commission. Effective Jan. 31, 1986, the SEC
approved new maintenance margin rules, permitting margins to be the price of the
option plus 15 percent of the market value of the stock underlying the option.
Effective June 8, 1988, margins were set to be the price of the option plus 20
percent of the market value of the stock underlying the option (or 15 percent in the
case of stock-index options).

A28

Domestic Financial Statistics • September 1993

1.38 FEDERAL FISCAL AND FINANCING OPERATIONS
Millions of dollars
Fiscal year

Calendar year

Type of account or operation

1993
1990

U.S. budget1
1 Receipts, total
2
On-budget
3
Off-budget
4 Outlays, total
5
On-budget
6
Off-budget
7 Surplus or deficit ( - ) , total
8
On-budget
9
Off-budget
Source of financing (total)
10 Borrowing from the public
11 Operating cash (decrease, or increase ( - ) ) . . .
12 Other

1991

1992
Jan.

Feb.

Mar.

Apr.

May

June

1,031,308
749,654
281,654
l,252,691 r
l,027,626 r
225,064
-221,384 r
-277,974 r
56,590

1,054,265
760,382
293,883
l,323,785 r
l,082,098 r
241,685
-269,521 r
—321,719r
52,198

1,090,513
788,087
302,426
1,380,657
1,128,318
252,339
-290,144
-340,231
50,087

112,718
90,129
22,589
82,903
84,928
-2,025
29,815
5,201
24,614

66,138
41,038
25,100
113,732
89,276
24,456
-47,594
-48,238
644

83,453
57,259
26,194
128,030
103,793
24,237
—44,577r
-46,534
1,957

132,122
96,413
35,709
124,034
101,861
22,174
8,088
-5,448
13,535

70,758
44,636
26,122
107,716
83,320
24,395
-36,957
-38,684
1,727

128,591
98,685
29,906
117,495
103,501
13,994
11,096
-4,816
15,912

220,101
818
-461

276,802
-1,329
-5,981

310,918
-17,305
-3,469

-8,355
-16,436
-5,024

30,689
27,227
-10,322

37,727
-2,452
9,302

5,464
-18,945
5,393

30,832
20,1%
-14,071

24,757
-40,288
4,435

40,155
7,638
32,517

41,484
7,928
33,556

58,789
24,586
34,203

46,326
9,572
36,754

19,099
5,350
13,749

21,551
6,752
14,799

40,496
7,273
33,223 r

20,300
5,787
14,514

60,588
28,386
32,202

MEMO

13 Treasury operating balance (level, end of
period)
14
Federal Reserve Banks
15
Tax and loan accounts

1. In accordance with the Balanced Budget and Emergency Deficit Control Act
of 1985, all former off-budget entries are now presented on-budget. Federal
Financing Bank (FFB) activities are now shown as separate accounts under the
agencies that use the F F B to finance their programs. The act also moved two
social security trust funds (federal old-age survivors insurance and federal
disability insurance) off budget. The Postal Service is included as an off-budget
item in the Monthly Treasury Statement beginning in 1990.
2. Includes special drawing rights (SDRs); reserve position on the U.S. quota
in the International Monetary Fund (IMF); loans to the IMF; other cash and




monetary assets; accrued interest payable to the public; allocations of SDRs;
deposit funds; miscellaneous liability (including checks outstanding) and asset
accounts; seigniorage; increment on gold; net gain or loss for U . S . currency
valuation adjustment; net gain or loss for I M F loan-valuation adjustment; and
profit on sale of gold.
SOURCES. Monthly Treasury Statement of Receipts and Outlays of the U.S.
Government and Budget of the U.S. Government.

Federal Finance

A29

1.39 U.S. BUDGET RECEIPTS AND OUTLAYS 1
Millions of dollars
Calendar year

Fiscal year

1993

1991

Source or type
1991

1992
H2

HI

H2

HI

Apr.

May

RECEIPTS

1 All sources
2 Individual income taxes, net
3
Withheld
4
Presidential Election Campaign Fund .
5
Nonwithheld
6
Refunds
Corporation income taxes
7
Gross receipts
8
Refunds
9 Social insurance taxes and contributions,
net
10
Employment taxes and
contributions
11
Self-employment taxes and
contributions
12
Unemployment insurance
13
Other net receipts 4
14
15
16
17

Excise taxes
Customs deposits
Estate and gift taxes . .
Miscellaneous receipts 5

1,054,265

1,090,513

519,181

560,350

540,506

593,780

132,122

70,758

467,827
404,152
32
142,693
79,050

475,979 r
408,352
30
149,430
81,834 r

234,939
210,552

33,296
8,910

236,576 r
198,868
20
110,995
73,308 r

246,961
215,591
10
39,371
8,011

256,105
210,066
25
113,482
67,468

56,137
32,691
6
44,755
21,315

17,919
31,264
5
2,281
15,631

113,599
15,513

117,949
17,679

54,016
8,649

61,682
9,403 r

58,022
7,219

69,044
7,198

19,272
1,477

3,022
646

396,011

413,689

186,839

224,569

192,599

227,177

49,176

42,277

370,526

385,491

175,802

208,110

180,758

208,776

45,164

33,062

25,457
20,922
4,563

24,421
23,410
4,788

3,306
8,721
2,317

20,434 r
14,070
2,389

3,988
9,397
2,445

16,270
16,074
2,326

12,183
3,581
431

1,620
8,849
365

42,430
15,921
11,138
22,852

45,570
17,359
11,143
26,517 r

24,429
8,694
5,507
13,406

22,389 r
8,146
5,701 r
10,690r

23,456
9,497
5,733
11,472

23,398
8,860
6,494
9,900

4,168
1,544
1,898
1,404

3,502
1,419
1,009
2,257

1,323,757

1,380,657

694,364

704,288

723,367

673,910

124,034

107,716

298,361
16,106
16,409
4,509
20,017
14,997

147,669
7,691
8,472
1,698
11,130
7,418

147,065
8,540
7,951
1,442
8,594 r
7,526

155,501
9,911
8,521
3,109
11,617
8,881

140,535
6,565
7,9%
2.462
8,588
11,824

27,192
536
1,444
431
1,709
2,666

20,460
1,410
1,382
453
1,071
1,739

-7,843
18,477
4,540

-15,112
16,109
4,935

-3,%1
2,591
987

-1,896
2,398
862

1

OUTLAYS

18 AH types
19
20
21
22
23
24

National defense
International affairs
General science, space, and technology .
Energy
Natural resources and environment
Agriculture

272,514
16,167
15,946
2,511
18,708
14,864

25
26
27
28

Commerce and housing credit
Transportation
Community and regional development . .
Education, training, employment, and
social services

75,639
31,531
7,432

9,753
33,759
7,923

36,534
17,093
3,783

15,615
15,673
3,903

41,479

45,248

21,114

23,767 r

20,922

23,983

3,695

3,433

29 Health
30 Social security and Medicare
31 Income security

71,183
373,494
171,618

89,570
406,569
197,867

41,459
193,098
87,693

44,164 r
205,500
104,537r

47,223
232,109
98,693

49,882
195,933
108,559

8,883
37,236
20,408

7,758
35,020
15,900

32
33
34
35
36

31,344
12,295
11,358
195,012
-39,356

34,133
14,450
12,939
199,429
-39,280

17,425
6,574
6,794
99,149
-20,436

18,561
7,283
8,138
98,549
-20,914

16,384
7.463
5,205
99,635
-17,035

4,332
1,581
655
16,585
-2,935

801
1,199
886
17,420
-2,579

Veterans benefits and services
Administration of justice
General government
Net interest®
Undistributed offsetting receipts'

1. Functional details do not sum to total outlays for calendar year data because
revisions to monthly totals have not been distributed among functions. Fiscal year
total for outlays does not correspond to calendar year data because revisions from
the Budget have not been fiilly distributed across months.
2. Old-age, disability, and hospital insurance, and railroad retirement accounts.
3. Old-age, disability, and hospital insurance.
4. Federal employee retirement contributions and civil service retirement and
disability fimd.




15,597
7,435
5,050 r

100,161
-18,229

5. Deposits of earnings by Federal Reserve Banks and other miscellaneous receipts.
6. Includes interest received by trust funds.
7. Consists of rents and royalties for the outer continental shelf and U.S.
government contributions for employee retirement.
SOURCES. U.S. Department of the Treasury, Monthly Treasury Statement of
Receipts and Outlays of the U.S. Government, and the U.S. Office of Management and Budget, Budget of the U.S. Government, Fiscal Year 1994.

A30

Domestic Financial Statistics • September 1993

1.40 FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION
Billions of dollars, end of month
1991

1993

1992

Item
June 30

Sept. 30

Dec. 31

Mar. 31

June 30

Sept. 30

Dec. 31

Mar. 31

1 Federal debt outstanding

3,563

3,683

3,820

3,897

4,001

4,083

4,196

4,250

n.a.

? Public debt securities
3
Held by public
4
Held by agencies

3,538
2,643
895

3,665
2,746
920

3,802
2,833
969

3,881
2,918
964

3,985
2,977
1,008

4,065
3,048
1,016

4,177
3,129
1,048

4,231
3,188
1,043

4,352
n.a.
n.a.

25
25
0

18
18
0

19
19
0

16
16
0

16
16
0

18
18
0

19
19
0

20
20
0

3,450

3,569

3,707

3,784

3,891

3,973

4,086

4,140

4,256

3,450
0

3,569
0

3,706
0

3,783
0

3,890
0

3,972
0

4,085
0

4,139
0

4,256
0

4,145

4,145

4,145

4,145

4,145

4,145

4,145

4,145

4,370

5 Agency securities
6
Held by public
7
Held by agencies
8 Debt subject to statutory limit
9 Public debt securities
10 Other debt 1
MEMO

11 Statutory debt limit

1. Consists of guaranteed debt of U.S. Treasury and other federal agencies,
specified participation certificates, notes to international lending organizations,
and District of Columbia stadium bonds.

1.41 GROSS PUBLIC DEBT OF U.S. TREASURY

June 30

n.a.
n.a.
n.a.

SOURCES. U.S. Treasury Department, Monthly Statement of the Public Debt of
the United States and Treasury Bulletin.

Types and Ownership

Billions of dollars, end of period
1993

1992
Type and holder

1 Total gross public debt
2
3
4
5
6
7
8
9
10
11
12
13
14

By type
Interest-bearing
Marketable
Bills
Notes
Bonds
Nonmarketable'
State and local government series
Foreign issues 2
Government
Public
Savings bonds and n o t e s . .
Government account series
Non-interest-bearing

By holder 4
15 U.S. Treasury and other federal agencies and trust funds,
16 Federal Reserve Banks
17 Private investors
18
Commercial banks
19
Money market funds
20
Insurance companies
21
Other companies
22
State and local treasuries
Individuals
23
Savings bonds
24
Other securities
25
Foreign and international 5
26
Other miscellaneous investors 6

1989

1991

1992
Q3

Q4

Ql

Q2

2,953.0

3,364.8

3,801.7

4,177.0

4,064.6

4,177.0

4,230.6

4,352.0

2,931.8
1,945.4
430.6
1,151.5
348.2
986.4
163.3
6.8
6.8
.0
115.7
695.6
21.2

3,362.0
2,195.8
527.4
1,265.2
388.2
1,166.2
160.8
43.5
43.5
.0
124.1
813.8
2.8

3,798.9
2,471.6
590.4
1,430.8
435.5
1,327.2
159.7
41.9
41.9
.0
135.9
959.2
2.8

4,173.9
2,754.1
657.7
1,608.9
472.5
1,419.8
153.5
37.4
37.4
.0
155.0
1,043.5
3.1

4,061.8
2,677.5
634.3
1,566.4
461.8
1,384.3
157.6
37.0
37.0
.0
148.3
1,011.0
2.8

4,173.9
2,754.1
657.7
1,608.9
472.5
1,419.8
153.5
37.4
37.4
.0
155.0
1,043.5
3.1

4,227.6
2,807.1
659.9
1,652.1
480.2
1,420.5
151.6
37.0
37.0
.0
161.4
1,040.0
3.0

4,349.0
2,860.6
659.3
1,698.7
487.6
1,4!8 . 4
152.8
43.0
43.0
.0
164.4
1,097.8
2.9

707.8
228.4
2,015.8
164.9
14.9
125.1
93.4
487.5

828.3
259.8
2,288.3
171.5
45.4
142.0
108.9
490.4

968.7
281.8
2,563.2
233.4
80.0
168.7
150.8
520.3

1,047.8
302.5
2,839.9
293.4
80.6
190.3
192.5
534.8

1,016.3
296.4
2,765.5
287.4
79.8
185.6
180.8
529.5

1,047.8
302.5
2,839.9
293.4
80.6
190.3
192.5
534.8

1,043.2
305.2
2,895.0
296.0
77.6
194.0
199.3
536.0

117.7
98.7
392.9
520.7

126.2
107.6
421.7
674.5

138.1
125.8
455.0
691.1

157.3
131.9
512.5
746.6

150.3
130.9
499.0
722.1

157.3
131.9
512.5
746.6

163.6
134.1
528.4
766.0

1. Includes (not shown separately) securities issued to the Rural Electrification
Administration, depository bonds, retirement plan bonds, and individual retirement bonds.
2. Nonmarketable series denominated in dollars, and series denominated in
foreign currency held by foreigners.
3. Held almost entirely by U.S. Treasury and other federal agencies and trust
funds.
4. Data for Federal Reserve Banks and U.S. government agencies and trust
funds are actual holdings; data for other groups are Treasury estimates.




1990

n.a.

5. Consists of investments of foreign balances and international accounts in the
United States.
6. Includes savings and loan associations, nonprofit institutions, credit unions,
mutual savings banks, corporate pension trust funds, dealers and brokers, certain
U.S. Treasury deposit accounts, and federally sponsored agencies.
SOURCES. U.S. Treasury Department, data by type of security, Monthly
Statement of the Public Debt of the United States; data by holder, Treasury
Bulletin.

Federal Finance
1.42 U.S. GOVERNMENT SECURITIES DEALERS

A31

Transactions1

Millions of dollars, daily averages
1993, week ending

1993
Item

June 23

June 30

44,523

35,942

47,620

45,023
43,317
21,350
18,306

48,194
38,002
17,810
15,826

42,376
41,320
21,189
16,141

5,616
772
522

7,154
646
368

6,946
620
375

9,425
559
529

14,214
2,302

19,781
2,776

22,913
2,752

12,933
2,861

14,136
3,664

116,255

110,126

93,090

106,410

96,279

100,919

1,013
8,940

1,035
7,970

1,005
9,713

1,147
12,487

907
7,053

1,554
7,145

76,504

65,784

67,801

57,113

66,108

59,495

67,728

7,404
13,134

5,847
9,348

5,914
8,547

5,905
12,844

7,020
13,178

7,033
8,741

8,959
10,655

May 12

May 19

May 26

June 2

June 9

June 16

38,696

30,411

50,017

40,679

55,905

44,212

42,379
40,316
17,817
14,160

48,407
41,351
28,140
16,146

61,051
47,856
21,645
19,793

60,388
47,314
18,731
14,926

47,800
40,879
16,586
16,757

39,242
35,809
17,800
13,139

6,033
657
350

4,867
702
424

7,242
665
373

6,104
427
330

6,371
358
220

18,294
3,262

12,820
4,414

24,851
3,556

20,592
2,998

15,170
3,118

97,491

111,243

96,439

103,168

123,857

1,155
8,855

1,019
9,484

1,137
6,489

1,089
11,762

876
10,456

66,539

59,531

66,289

56,928

61,288

5,931
11,378

5,778
11,775

6,011
12,072

5,903
10,745

4,903
16,646

Mar.

Apr.

May

43,300

41,043

42,349

47,300
45,252
23,269
17,592

36,975
42,812
19,229
16,963

53,322
44,104
21,228
16,527

5,790
788
1,125

5,715
640
578

6,108
572
350

14,705
4,059

17,293
3,336

110,173
1,771
7,388

May 5

IMMEDIATE TRANSACTIONS2

By type of security
U.S. Treasury securities
1 Bills
Coupon securities, by maturity
2
Less than 3.5 years
3.5 to 7.5 years
3
4
7.5 to 15 years
5
15 years or more
Federal agency securities
Debt, by maturity
Less than 3.5 years
6
7
3.5 to 7.5 years
7.5 years or more
8
Mortgage-backed
Pass-throughs
9
All others
10

11
12
13
14
15
16

By type of counterparty
Primary dealers and brokers
U.S. Treasury securities
Federal agency securities
Debt
Mortgage-backed
Customers
U.S. Treasury securities
Federal agency securities
Debt
Mortgage-backed
FUTURES AND FORWARD
TRANSACTIONS4

By type of deliverable security
U . S . Treasury securities
17 Bills
Coupon securities, by maturity
18
Less than 3.5 years
3.5 to 7.5 years
19
7.5 to 15 years
20
21
15 years or more
Federal agency securities
Debt, by maturity
Less than 3.5 years
22
23
3.5 to 7.5 years
24
7.5 years or more
Mortgage-backed
Pass-tlyoughs
25
Others 3
26

2,205

2,378

2,586

2,078

1,976

3,439

2,741

2,434

3,636

3,331

3,779

2,268

2,348
2,287
3,542
11,335

1,942
1,384
2,377
9,025

1,937
1,799
3,067
10,406

1,947
1,646
2,420
8,896

1,526
1,326
3,608
8,855

2,168
1,483
2,844
12,552

2,012
2,084
2,985
10,952

2,100
2,793
3,318
10,012

2,113
2,366
3,280
9,236

1,785
1,744
3,310
10,702

2,121
1,806
2,471
8,247

1,638
1,502
2,670
8,320

92
103
32

102
128
33

153
73
15

67
236
7

94
100
22

320
32
17

55
20
13

219
20
9

112
34
10

340
51
175

236
42
85

199
104
98

22,141
1,471

21,378
1,463

19,462
1,743

18,768
1,479

23,463
1,968

22,108
1,900

14,529
1,636

17,298
1,551

26,016
1,434

27,446
1,280

21,243
1,068

22,362
2,003

1,662
431
687
972

1,611
564
507
1,084

1,108
667
521
1,183

1,257
472
357
1,180

1,312
868
390
953

1,248
419
473
1,111

900
1,038
774
1,713

733
325
562
804

783
420
288
814

1,426
677
1,020
986

1,117
482
421
767

793
220
673
752

586

664

465

415

674

357

333

569

871

461

411

671

OPTIONS TRANSACTIONS5

27
28
29
30
31

By type of underlying security
U.S. Treasury, coupon
securities, by maturity
Less than 3.5 years
3.5 to 7.5 years
7.5 to 15 years
15 years or more
Federal agency, mortgagebacked securities
Pass-throughs

1. Transactions are market purchases and sales of securities as reported to the
Federal Reserve Bank of N e w York by the U.S. government securities dealers on
its published list of primary dealers. Averages are based on the number of trading
days in the period. Immediate, forward, and futures transactions are reported at
principal value, which does not include accrued interest; options transactions are
reported at the face value of the underlying securities.
Dealers report cumulative transactions for each week ending Wednesday.
2. Transactions for immediate delivery include purchases or sales of securities
(other than mortgage-backed agency securities) for which delivery is scheduled in
five business days or less and "when-issued" securities that settle on the issue
date of offering. Transactions for immediate delivery of mortgage-backed agency
securities include purchases and sales for which delivery is scheduled in thirty days or
less. Stripped securities are reported at market value by maturity of coupon or corpus.
3. Includes such securities as collateralized mortgage obligations (CMOs), real
estate mortgage investment conduits (REMICs), interest-only securities (IOs),
and principal-only securities (POs).




4. Futures transactions are standardized agreements arranged on an exchange.
Forward transactions are agreements made in the over-the-counter market that
specify delayed delivery. All futures transactions are included regardless of time
to delivery. Forward contracts for U.S. Treasury securities and federal agency
debt securities are included when the time to delivery is more than five business
days. Forward contracts for mortgage-backed agency securities are included
when the time to delivery is more than thirty days.
5. Options transactions are purchases or sales of put-and-call options, whether
arranged on an organized exchange or in the over-the-counter market, and include
options on futures contracts on U.S. Treasury and federal agency securities.
NOTE. In tables 1.42 and 1.43, " n . a . " indicates that data are not published
because of insufficient activity.
Data for several types of options transactions—U.S. Treasury securities, bills;
Federal agency securities, debt; and federal agency securities, mortgage-backed,
other than pass-throughs—are no longer available because activity is insufficient.

A32

DomesticNonfinancialStatistics • September 1993

1.43 U.S. GOVERNMENT SECURITIES DEALERS

Positions and Financing1

Millions of dollars
1993

1993, week ending

xiem
Mar.

Apr.

May

May 5

May 12

May 19

May 26

June 2

June 9

June 16

June 23

Positions 2
N E T IMMEDIATE POSITIONS3

By type of security
U.S. Treasury securities
1 Bills
Coupon securities, by maturity
Less than 3.5 years
2
3.5 to 7.5 years
3
7.5 to 15 years
4
15 years or more
5
Federal agency securities
Debt, by maturity
6
Less than 3.5 years
3.5 to 7.5 years
7
7.5 years or more
8
Mortgage-backed
Pass-throughs
9
10
All others
Other money market instruments
Certificates of deposit
11
Commercial paper
12
Bankers acceptances
13

13,550

18,483

7,999

13,757

4,818

8,062

5,285

10,408

-266

3,776

7,002

1,628
-14,104
-10,240
9,342

2,928
-17,023
-12,805
9,248

10,275
-19,900
-10,222
8,228

6,038
-16,651
-11,584
8,447

11,219
-17,854
-6,990
7,707

8,007
-23,033
-8,787
7,439

13,584
-20,542
-11,841
7,687

11,734
-20,726
-13,127
10,600

9,691
-20,498
-11,570
11,233

8,957
-16,896
-12,150
12,062

14,549
-14,357
-10,155
11,268

6,451
3,332
4,896

6,342
3,178
3,958

5,389
2,798
2,957

4,274
3,510
3,408

5,910
3,197
3,416

3,829
2,617
2,943

6,819
2,379
2,391

5,954
2,370
2,678

6,085
1,610
2,754

6,697
2,233
2,853

7,794
2,303
2,825

33,009
25,734

34,056
25,866

29,356
27,158

22,530
27,808

40,102
26,619

29,843
25,617

28,498
27,363

21,660
29,135

36,490
26,877

44,287
24,848

39,859
24,899

3,212
6,237
l,138 r

3,203
5,145
972

3,681 r
6,066
862

3,280
4,671
574

2,699
5,403
739

3,544
5,387
921

4,602
7,245
921

4,357
7,687
1,159

3,247
6,504
1,024

3,386
7,998
989

2,555
5,721
994

FUTURES A N D FORWARD POSITIONS5

14
15
16
17
18
19
20
21
22
23
24

By type of deliverable security
U.S. Treasury securities
Bills
Coupon securities, by maturity
Less than 3.5 years
3.5 to 7.5 years
7.5 to 15 years
15 years or more
Federal agency securities
Debt, by maturity
Less than 3.5 years
3.5 to 7.5 years
7.5 years or more
Mortgage-backed
Pass-throughs
All others 4 ^
Certificates of deposit

-5,103

-7,951

-5,222

-10,315

-8,312

-2,732

-2,851

-2,610

-2,373

-4,8%

-8,102

-568
4,333
2,954
-5,119

-1,433
4,857
4,385
-5,103

-1,556
4,626
4,410
-4,613

-409
4,086
4,861
-4,433

-1,679
4,763
3,877
-5,518

-1,376
5,267
5,681
-4,244

-1,408
4,949
3,744
-3,857

-2,993
3,627
3,858
-5,101

-3,388
3,747
3,400
-5,277

-4,597
3,441
1,789
-6,256

-2,900
3,515
1,148
-6,188

-194
-39
33

-285
-50
-74

-209
-111
-85

-844
-128
-27

-272
-93
-100

18
-71
-220

-97
-143
-20

38
-133
-21

403
-102
-45

81
60
93

-104
-65
131

-13,086
3,376 r

-12,900
4,770
-160,960

-6,758
1,773
-155,044

-3,124
3,139
-144,995

-18,952
2,907
-161,008

-6,724
2,164
-161,550

-3,061
1,135
-154,231

1,459
-837
-148,775

-13,453
977
-152,557

-20,674
1,930
-144,525

-17,761
2,615
-145,753

Financing?
Reverse repurchase agreements
25 Overnight and continuing
26

233,038
360,955

223,214
393,238

223,931 r
373,495 r

216,856
387,767

228,208
409,092

235,710
357,602

209,018
365,809

229,404
342,400

223,498
375,852

228,081
394,328

217,109
392,882

Repurchase agreements
27 Overnight and continuing
28 Term

403,942
349,516

406,560
369,281

399,943
346,717

386,607
352,304

397,630
387,153

419,306
333,158

390,122
345,364

403,158
305,395

3%,460
339,048

416,8%
357,665

401,316
367,531

Securities borrowed
29 Overnight and continuing
30 Terni

115,244
40,753

117,774
44,365

123,353
42,805

120,427
43,553

120,229
43,315

125,020
41,154

123,144
45,152

128,611
40,368

132,690
39,756

132,367
41,689

130,809
43,267

Securities loaned
31 Overnight and continuing
32 Term

3,504
482

4,762
587

5,055
938

4,484
489

4,668
1,189

5,358
1,221

5,581
1,025

5,007
518

4,311
360

4,997
793

4,662
665

Collateralized loans
33 Overnight and continuing

14,209

14,434

14,538r

14,622

15,839

14,596

14,483

12,630

14,508

16,428

15,735

MEMO: Matched book
Reverse repurchase agreements
34 Overnight and continuing
35 Term

156,399
313,182

148,137
341,856

146,741
321,698

140,334
336,744

142,860
356,067

152,953
303,795

141,791
314,935

156,812
293,069

152,901
320,084

155,918
339,480

152,407
336,714

Repurchase agreements
36 Overnight and continuing
37 Term

214,034
266,309

204,658
283,791

210,160
257,391

210,027
265,052

213,256
288,478

210,595
242,717

201,427
252,758

217,574
233,235

212,836
254,572

218,737
269,369

198,694
282,080

7

1. Data for positions and financing are obtained from reports submitted to the
Federal Reserve Bank of New York by the U.S. government securities dealers on
its published list of primary dealers. Weekly figures are close-of-business Wednesday data; monthly figures are averages of weekly data.
2. Securities positions are reported at market value.
3. Net immediate positions include securities purchased or sold (other than
mortgage-backed agency securities) that have been delivered or are scheduled to
be delivered in five business days or less and "when-issued" securities that settle
on the issue date of offering. Net immediate positions of mortgage-backed agency
securities include securities purchased or sold that have been delivered or are
scheduled to be delivered in thirty days or less.
4. Includes such securities as collateralized mortgage obligations (CMOs), real
estate mortgage investment conduits (REMICs), interest-only securities (ids),
and principal-only securities (POs).
5. Futures positions reflect standardized agreements arranged on an exchange.
Forward positions reflect agreements made in the over-the-counter market that
specify delayed delivery. All futures positions are included regardless of time to




delivery. Forward contracts for U.S. Treasury securities and federal agency debt
securities are included when the time to delivery is more than five business days.
Forward contracts for mortgage-backed agency securities are included when the
time to delivery is more than thirty days.
6. Overnight financing refers to agreements made on one business day that
mature on the next business day; continuing contracts are agreements that remain
in effect for more than one business day but have no specific maturity and can be
terminated without advance notice by either party; term agreements have a fixed
maturity of more than one business day.
7. Matched-book data reflect financial intermediation activity in which the
borrowing and lending transactions are matched. Matched-book data are included
in the financing breakdowns given above. The reverse repurchase and repurchase
numbers are not always equal because of the "matching" of securities of different
values or different types of collateralization.
NOTE. Data for futures and forward commercial paper and bankers acceptances and
for term financing of collateralized loans are no longer available because of insufficient
activity.

Federal Finance
1.44 FEDERAL AND FEDERALLY SPONSORED CREDIT AGENCIES

A33

Debt Outstanding

Millions of dollars, end of period
1992
Agency

1988

1 Federal and federally sponsored agencies
2 Federal agencies
f
3
Defense Department 1
4
Export-Import Bank 2 ,
^
5
Federal Housing Administration
6
Government National Mortgage Association certificates of
participation 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
H
Federal National Mortgage Association
14
Farm Credit Banks 8
15
Student Loan Marketing Association 9
16
Financing Corporation
17
Farm Credit Financial Assistance Corporation 1 1
18
Resolution Funding Corporation 2

1989

1990

1993

1991
Dec.

Jan.

Feb.

Mar.

Apr.

381,498

411,805

434,668

442,772

483,970

487,331

494,739

494,656

0

35,668
8
11,033
150

35,664
7
10,985
328

42,159
7
11,376
393

41,035
7
9,809
397

41,829
7
7,208
374

41,641
7
7,208
231

42,115
7
7,208
237

42,051
7
6,749
259

42,619
7
6,749
263

0
6,142
18,335
0

0
6,445
17,899
0

0
6,948
23,435
0

0
8,421
22,401
0

0
10,660
23,580
0

0
10,660
23,535
0

0
10,660
24,003
0

0
10,440
24,5%
0

0
10,440
25,160
0

345,832
135,836
22,797
105,459
53,127
22,073
5,850
690
0

375,428
136,108
26,148
116,064
54,864
28,705
8,170
847
4,522

392,509
117,895
30,941
123,403
53,590
34,194
8,170
1,261
23,055

401,737
107,543
30,262
133,937
52,199
38,319
8,170
1,261
29,996

442,141
114,733
29,631
166,300
51,910
39,650
8,170
1,261
29,996

445,690
113,253
34,479
165,958
52,264
39,812
8,170
1,261
29,996

452,624
113,347
44,490
163,538
51,502
39,822
8,170
1,261
29,996

452,605
115,272
41,183
165,818
51,630
38,776
8,170
1,261
29,9%

0
117,363
0
165,135
51,210
0
8,170
1,261
29,9%

142,850

134,873

179,083

185,576

154,994

151,059

147,464

146,097

140,807

11,027
5,892
4,910
16,955
0

10,979
6,195
4,880
16,519
0

11,370
6,698
4,850
14,055
0

9,803
8,201
4,820
10,725
0

7,202
10,440
4,790
6,975
0

7,202
10,440
4,790
6,825
0

7,202
10,440
4,790
6,825
0

6,743
10,440
4,790
6,675
0

6,743
10,440
4,790
6,675
0

58,496
19,246
26,324

53,311
19,265
23,724

52,324
18,890
70,896

48,534
18,562
84,931

42,979
18,172
64,436

42,979
18,037
60,786

42,979
18,036
57,192

42,979
17,966
56,504

41,629
18,008
52,522

MEMO

19 Federal Financing Bank debt"
20
21
22
23
24

Lending to federal and federally sponsored
Export-Import Bank 3
Postal Service
Student Loan Marketing Association
Tennessee Valley Authority
United States Railway Association 6

Other lending14
25 F a n n e r s Home Administration
26 Rural Electrification Administration
27

agencies

1. Consists of mortgages assumed by the Defense Department between 1957
and 1963 under family housing and homeowners assistance programs.
2. Includes participation certificates reclassified as debt beginning Oct. 1,1976.
3. On-budget since Sept. 30, 1976.
4. Consists of debentures issued in payment of Federal Housing Administration
insurance claims. Once issued, these securities may be sold privately on the

securities market.

5. Certificates of participation issued before fiscal year 1969 by the Government
National Mortgage Association acting as trustee for the F a n n e r s Home Administration, the Department of Health, Education, and Welfare, the Department of
Housing and Urban Development, the Small Business Administration, and the
Veterans' Administration.
6. Off-budget.
7. Includes outstanding noncontingent liabilities: notes, bonds, and debentures. Some data are estimated.
8. Excludes borrowing by the Farm Credit Financial Assistance Corporation,
shown on line 17.
9. Before late 1982, the Association obtained financing through the Federal
Financing Bank (FFB). Borrowing excludes that obtained from the F F B , which is
shown on line 22.




10. The Financing Corporation, established in August 1987 to recapitalize the
Federal Savings and Loan Insurance Corporation, undertook its first borrowing in
October 1987.
11. The Farm Credit Financial Assistance Corporation, established in January
1988 to provide assistance to the Farm Credit System, undertook its first
borrowing in July 1988.
12. The Resolution Funding Corporation, established by the Financial Institutions Reform, Recovery and Enforcement Act of 1989, undertook its first
borrowing in October 1989.
13. The FFB, which began operations in 1974, is authorized to purchase or sell
obligations issued, sold, or guaranteed by other federal agencies. Because F F B
incurs debt solely for the purpose of lending to other agencies, its debt is not
included in the main portion of the table in order to avoid double counting.
14. Includes F F B purchases of agency assets and guaranteed loans; the latter
are loans guaranteed by numerous agencies, with the amounts guaranteed by any
one agency generally being small. The Farmers Home Administration entry
consists exclusively of agency assets, whereas the Rural Electrification Administration entry consists of both agency assets and guaranteed loans.

A34

DomesticNonfinancialStatistics • September 1993

1.45 NEW SECURITY ISSUES

Tax-Exempt State and Local Governments

Millions of dollars
1992
Type of issue or issuer,
or use

1990

1 All issues, new and refunding1

1991

1993

1992
Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

June

120,339

154,402

215,191

14,133

19,577

18,039"

18,285 r

28,920"

20,956'

27,178'

28,529

By type of issue
2 General obligation
3 Revenue

39,610
81,295

55,100
99,302

78,611
136,580

5,203
8,930

6,024
13,553

4,840
13,199

6,%3
11,322

8,254
20,666

8,272
12,684

9,452
17,726

8,415
20,114

By type of issuer
4 State
5 Special district or statutory authority 2
6 Municipality, county, or township

15,149
72,661
32,510

24,939
80,614
48,849

25,295
127,618
60,210

1,688
8,197
4,248

2,339
11,159
6,079

1,339
12,706
3,994

3,485
10,146
4,654

2,139
19,804
6,977

1,463
9,923
9,570

2,910
15,441
8,827

3,562
18,132
6,835

103,235

116,953

120,272

8,028

8,010

5,604 r

4,775 r

9,741 r

4,941 r

8,681 r

11,208

17,042
11,650
11,739
23,099
6,117
34,607

21,121
13,395
21,039
25,648
8,376
30,275

22,071
17,334
20,058
21,7%
5,424
33,589

1,800
531
960
1,070
581
3,086

1,658
831
1,258
1,121
339
2,803

1,033
829
894
777
337
1,734

1,264
131
423
618
69
2,270

1,482
2,111
538
1,556
765
3,289

833
699
806
942
134
1,527

1,596
813
955
1,756
601
2,960

2,208
772
1,629
2,073
1,042
3,484

7 Issues for new capital
8
9
10
11
12
13

By use of proceeds
Education
Transportation
Utilities and conservation
Social welfare
Industrial aid
Other purposes

1. Par amounts of long-term issues based on date of sale.
2. Includes school districts.

1.46 NEW SECURITY ISSUES

SOURCES. Securities Data Company beginning January 1993;
Dealer's Digest before then.

Investment

U.S. Corporations

Millions of dollars
1992
Type of issue, offering,
or issuer

1990

1991

1993

1992
Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

1 All issues1

340,049

465,243'

n.a.

39,280

35,525

39,424

50,692'

59,427'

55,929"

40,173'

43,108

2 Bonds2

299,884

389,822'

471,125'

32,314

31,026

33,375

45,458'

49,367"

47,091'

33,922'

34,100

By type of offering
3 Public, domestic
4 Private placement, domestic 3
5 Sold abroad

188,848
86,982
23,054

286,930"
74,930
27,%2

377,681"
65,853
27,591"

30,249
n.a.
2,066

28,774
n.a.
2,252

31,835
n.a.
1,540

41,575"
n.a.
3,884

47,084"
n.a.
2,283"

41,888"
n.a.
5,203"

30,718"
n.a.
3,204"

31,100
n.a.
3,000

51,779
40,733
12,776
17,621
6,687
170,288

86,628
36,666
13,598
23,945
9,431
219,750

81,998"
42,869"
9,979"
48,055"
15,394"
272,830"

7,975
2,813
290
3,700
427
17,110

3,467
2,3%
0
1,289
374
23,499

4,232
2,176
611
2,867
516
22,973

9,393
3,074
316
4,282
3,019
25,374"

8,150
2,268
248
5,624
2,890
30,187"

8,067
2,695
1,067
7,058
3,270
24,935"

6,234"
2,194"
123"
5,767"
2,015"
17,588"

3,950
3,450
800
3,000
2,100
20,800

6
7
8
9
10
11

By industry group
Manufacturing
Commercial and miscellaneous
Transportation
Public utility
Communication
Real estate and financial

12 Stocks 2

40,175'

75,424'

88,324

6,966

4,499

6,049

5,234

10,060

8,838

6,251

8,698

By type of offering
13 Public preferred
14 Common
15 Private placement

3,998
19,442
16,736

17,085"
48,230"
10,109

21,339
57,119
9,866

2,901
4,065
n.a.

1,540
2,958
n.a.

1,608
4,441
n.a.

1,112
4,122
n.a.

1,898
8,161
n.a.

1,647
7,191
n.a.

702
5,549
n.a.

3,124
5,574
n.a.

5,649
10,171
369
416
3,822
19,738

24,111"
19,418
2,439
3,474
475
25,507

22,722
20,231
2,595
6,532
2,365
33,879

1,779
940
53
359
99
3,735

288
1,366
304
150
22
2,369

1,468
2,226
118
92
126
2,019

722
1,688
65
310
0
2,438

2,616
2,021
64
350
0
5,009

1,741
2,488
336
743
7
3,522

1,387
1,564
250
412
30
2,579

1,413
2,836
111
753
279
3,307

16
17
18
19
20
21

By industry group
Manufacturing
Commercial and miscellaneous
Transportation
Public utility
Communication
Real estate and financial

1. Figures represent gross proceeds of issues maturing in more than one year;
they are the principal amount or number of units calculated by multiplying by the
offering price. Figures exclude secondary offerings, employee stock plans,
investment companies other than closed-end, intracorporate transactions, equities sold abroad, and Yankee bonds. Stock data include ownership securities
issued by limited partnerships.




2. Monthly data cover only public offerings.
3. Monthly data are not available.
SOURCES. IDD Information Services, Inc., Securities Data Company, and the
Board of Governors of the Federal Reserve System.

Securities Market and Corporate Finance

A35

Net Sales and Assets 1

1.47 OPEN-END INVESTMENT COMPANIES
Millions of dollars

1992
Item

1991

1993

1992
Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr. r

May

1 Sales of own shares2

463,645

647,055

52,214

52,019

70,618

71,607

60,676

69,080

66,766

60,594

2 Redemptions of own shares
3 Net sales

342,547
121,098

447,140
199,915

37,134
15,080

34,126
17,893

51,993
18,625

46,545
25,062

39,684
20,992

47,414
21,666

46,518
20,248

38,792
21,802

4 Assets 4

808,582

1,056,310

983,151

1,019,618

1,056,310

1,082,653

1,116,784

1,154,445

1,178,663

1,219,443

5 Cash 5
6 Other

60,292
748,290

73,999
982,311

75,808
907,343

80,247
939,371

73,999
982,311

76,764
1,005,889

79,763
1,037,021

81,536
1,072,910

87,140
1,091,523

84,993
1,134,450

4. Market value at end of period, less current liabilities.
5. Includes all U.S. Treasury securities and other short-term debt securities.
SOURCE. Investment Company Institute. Data based on reports of membership,
which comprises substantially all open-end investment companies registered with
the Securities and Exchange Commission. Data reflect underwritings of new
companies.

1. Data on sales and redemptions exclude money market mutual funds but
include limited-maturity municipal bond funds. Data on assets exclude both
money market mutual funds and limited-maturity municipal bond funds.
2. Includes reinvestment of dividends. Excludes reinvestment of capital gains
distributions.
3. Excludes sales and redemptions resulting from transfers of shares into or out
of money market mutual funds within the same fund family.

1.48 CORPORATE PROFITS AND THEIR DISTRIBUTION
Billions of dollars; quarterly data at seasonally adjusted annual rates
1992

1991
Account

1991

1990

1993

1992
Q2

Q3

Q4

Q1

Q2

Q3

Q4

Qlr

1 Profits with inventory valuation and
capital consumption adjustment
2 Profits before taxes
3 Profits tax liability
4 Profits after taxes
5
Dividends
6
Undistributed profits

361.7
355.4
136.7
218.7
149.3
69.4

346.3
334.7
124.0
210.7
146.5
64.2

393.8
371.6
140.2
231.4
149.3
82.1

347.3
332.3
122.9
209.4
146.2
63.2

341.2
336.7
127.0
209.6
145.1
64.5

347.1
332.3
125.0
207.4
143.9
63.4

384.0
366.1
136.4
229.7
143.6
86.2

388.4
376.8
144.1
232.7
146.6
86.1

374.1
354.1
131.8
222.2
151.1
71.1

428.5
389.4
148.5
241.0
155.9
85.0

424.2
393.0
147.2
245.7
160.2
85.5

7 Inventory valuation
8 Capital consumption adjustment

-14.2
20.5

3.1
8.4

-7.4
29.5

9.9
5.1

-4.8
9.3

.7
14.1

-5.4
23.3

-15.5
27.0

-9.7
29.7

1.0
38.1

-9.4
40.6

SOURCE. U.S. Department of Commerce, Survey of Current

Business.

1.50 NONFARM BUSINESS EXPENDITURES

New Plant and Equipment

Billions of dollars; quarterly data at seasonally adjusted annual rates
1991
Industry

1991

1992

1992

1993

19931
Q4

Ql

Q2

Q3

Q4

Ql

Q2

Q31

1 Total nonfarm business

528.39

546.08

581.12

529.87

535.72

540.91

547.53

560.16

564.81

587.29

587.05

Manufacturing
2 Durable goods industries
3 Nondurable goods industries

77.64
105.17

73.41
100.50

77.49
100.74

76.40
102.66

74.19
99.79

74.26
97.52

71.84
100.39

73.34
104.28

79.32
95.85

78.06
104.73

75.01
102.17

10.02

8.90

9.51

9.99

8.87

9.18

9.09

8.44

8.84

10.10

10.15

5.95
10.17
6.54

6.77
8.97
7.04

6.71
7.50
9.12

5.44
10.41
6.45

6.65
8.86
6.37

6.50
9.75
7.27

6.87
10.13
7.69

7.08
7.13
6.84

6.01
7.43
9.06

6.68
8.89
8.42

6.87
7.59
9.09

43.76
22.82
246.32

48.05
23.91
268.54

52.75
22.99
294.32

44.75
22.67
251.11

46.06
22.75
262.17

48.45
24.19
263.80

47.73
23.92
269.86

49.95
24.78
278.32

49.87
23.44
284.99

54.11
23.58
292.72

53.66
22.54
299.%

Nonmanufacturing
4 Mining
Transportation
5
Railroad
6
Air
7
Other
Public utilities
8
Electric
9
Gas and other
10 Commercial and other 2

1. Figures are amounts anticipated by business.
2. " O t h e r " consists of construction, wholesale and retail trade, finance and




insurance, personal and business services, and communication.
SOURCE. U.S. Department of Commerce, Survey of Current Business.

A36

DomesticNonfinancialStatistics • September 1993

1.51 DOMESTIC FINANCE COMPANIES

Assets and Liabilities1

Billions of dollars, end of period; not seasonally adjusted
1991
Account

1990

1991

1992

1993

1992
Q3

Q4

Q1

Q2

Q3

Q4

Q1

ASSETS

1 Accounts receivable, gross 2
2
Consumer
i
Business
4
Real estate

492.3
133.3
293.6
65.5

480.6
121.9
292.9
65.8

482.1
117.1
296.5
68.4

485.2
125.3
293.7
66.2

480.6
121.9
292.9
65.8

475.6
118.4
290.8
66.4

476.7
116.7
293.2
66.8

473.9
116.7
288.5
68.8

482.1
117.1
296.5
68.4

473.7
111.9
293.7
68.1

57.6
9.6

55.1
12.9

50.8
15.8

57.6
13.1

55.1
12.9

53.6
13.0

51.2
12.3

50.8
12.0

50.8
15.8

48.1
14.9

7 Accounts receivable, net
8 All other

425.1
113.9

412.6
149.0

415.5
150.6

414.6
136.4

412.6
149.0

409.0
145.5

413.2
139.4

411.1
146.5

415.5
150.6

410.7
153.0

9 Total assets

539.0

561.6

566.1

551.1

561.6

554.5

552.6

557.6

566.1

563.7

10 Bank loans
11 Commercial paper

31.0
165.3

42.3
159.5

37.6
156.4

39.6
156.8

42.3
159.5

38.0
154.4

37.8
147.7

38.1
153.2

37.6
156.4

34.1
149.8

12
13
14
15

Debt
Other short-term
Long-term
Owed to parent
Not elsewhere classified
lb All other liabilities
1/ Capital, surplus, and undivided profits

n.a.
n.a.
37.5
178.2
63.9
63.7

n.a.
n.a.
34.5
191.3
69.0
64.8

n.a.
n.a.
37.8
195.3
71.2
67.8

n.a.
n.a.
36.5
185.0
68.8
63.8

n.a.
n.a.
34.5
191.3
69.0
64.8

n.a.
n.a.
34.5
189.8
72.0
66.0

n.a.
n.a.
34.8
191.9
73.4
67.1

n.a.
n.a.
34.9
191.4
73.7
68.1

n.a.
n.a.
37.8
195.3
71.2
67.8

n.a.
n.a.
41.9
195.1
76.2
66.7

18 Total liabilities and capital

539.6

561.2

566.1

550.5

561.2

554.6

552.7

559.4

566.1

563.7

5 LESS: Reserves for unearned income
b
Reserves for losses

LIABILITIES AND CAPITAL

1. Includes finance company subsidiaries of bank holding companies but not of
retailers and banks. Data are amounts carried on the balance sheets of finance
companies; securitized pools are not shown, since they are not on the books.

1.52 DOMESTIC FINANCE COMPANIES

2. Before deduction for unearned income and losses,

Consumer, Real Estate, and Business Credit1

Millions of dollars, amounts outstanding, end of period
1992
Type of credit

1990

1991

1993

1992
Dec.

Jan.

Feb.

Mar.

Apr. r

May

Seasonally adjusted
Total

522,474

519,910

534,845

534,845

529,256

531,398

532,144

532,468

522,449

Consumer
Real estate 2
Business

160,468
65,147
296,858

154,822
65,383
299,705

157,707
68,011
309,127

157,707
68,011
309,127

156,551
68,942
303,763

157,733
70,016
303,649

156,277
68,726
307,141

156,390
69,803
306,276

152,638
66,361
303,450

Not seasonally adjusted
Total

525,888

523,192

538,158

538,158

528,847

528,490

532,298

534,328

523,520

Consumer
Motor vehicles
Other c o n s u m e r
Securitized motor vehicles 4
Securitized other consumer 4
Real estate 2
Business
Motor vehicles
Retail 5
Wholesale 6
Leasing
Equipment
Retail
Wholesale 6
Leasing
Other business
Securitized business assets 4
Retail
Wholesale
Leasing

161,360
75,045
58,213
19,837
8,265
65,509
299,019
92,125
26,454
33,573
32,098
137,654
31,968
11,101
94,585
63,773
5,467
667
3,281
1,519

155,713
63,415
58,522
23,166
10,610
65,760
301,719
90,613
22,957
31,216
36,440
141,399
30,962
9,671
100,766
60,900
8,807
576
5,285
2,946

158,631
57,605
59,522
29,775
11,729
68,410
311,118
87,456
19,303
29,962
38,191
151,607
32,212
8,669
110,726
57,464
14,590
1,118
8,756
4,716

158,631
57,605
59,522
29,775
11,729
68,410
311,118
87,456
19,303
29,962
38,191
151,607
32,212
8,669
110,726
57,464
14,590
1,118
8,756
4,716

156,430
57,165
58,844
28,894
11,527
68,889
303,527
86,491
19,124
28,727
38,640
146,820
32,458
8,582
105,780
55,760
14,457
1,036
8,582
4,839

155,929
54,036
58,651
32,860
10,383
69,216
303,345
86,412
17,881
30,059
38,472
145,886
32,430
8,318
105,138
55,962
15,085
973
9,408
4,704

154,933
53,508
58,346
32,915
10,164
68,135
309,230
91,647
16,961
35,894
38,792
145,878
32,560
8,656
104,662
56,153
15,552
904
9,824
4,824

155,389
53,977
58,546
32,443
10,423
69,356
309,583
91,692
17,228
35,063
39,400
145,877
32,170
8,642
105,066
56,144
15,870
1,434
9,745
4,691

152,073
53,907
55,344
32,717
10,105
66,115
305,332
89,328
16,524
32,242
40,562
145,237
32,384
8,556
104,297
54,487
16,280
1,375
9,590
5,315

1. Includes finance company subsidiaries of bank holding companies but not of
retailers and banks. Data are before deductions for unearned income and losses.
Data in this table also appear in the Board's G.20 (422) monthly statistical release.
For ordering address, see inside front cover.
2. Includes all loans secured by liens on any type of real estate, for example,
first and junior mortgages and home equity loans.
3. Includes personal cash loans, mobile home loans, and loans to purchase other
types of consumer goods such as appliances, apparel, general merchandise, and
recreation vehicles.
FRASER
4. Outstanding balances of pools upon which securities have been issued; these
balances are no longer carried on the balance sheets of the loan originator.

Digitized for


5. Passenger car fleets and commercial land vehicles for which licenses are
required.
6. Credit arising from transactions between manufacturers and dealers, that is,
floor plan financing.
7. includes loans on commercial accounts receivable, factored commercial
accounts, and receivable dealer capital; small loans used primarily for business or
farm purposes; and wholesale and lease paper for mobile homes, campers, and
travel trailers.

Real Estate
1.53 MORTGAGE MARKETS

A37

Mortgages on New Homes

Millions of dollars except as noted
1992
Item

1990

1991

1993

1992
Dec.

Jan.

Feb.

Mar.

Apr.

May

June

Terms and yields in primary and secondary markets
PRIMARY MARKETS

1
2
3
4
5

Terms1
Purchase price (thousands of dollars)
Amount of loan (thousands of dollars)
Loan-to-price ratio (percent)
Maturity (years)
Fees and charges (percent of loan amount)

Yield (percent per year)
6 Contract rate 1 ,
7 Effective rate 1 ' 3
8 Contract rate ( H U D series) 4

153.2
112.4
74.8
27.3
1.93

155.0
114.0
75.0
26.8
1.71

158.1
118.1
76.6
25.6
1.60

154.0
117.7
77.7
26.1
1.31

158.6
119.5
76.8
25.7
1.49

159.7
114.5
75.4
23.8
1.43

156.2
121.5
79.3
26.9
1.50

150.9
115.0
78.5
24.9
1.23

153.1
118.8
79.5
26.9
1.43

185.6
125.3
75.3
25.4
1.32

9.68
10.01
10.08

9.02
9.30
9.20

7.98
8.25
8.43

7.65
7.88
8.19

7.57
7.82
7.93

7.52
7.77
7.63

7.22
7.46
7.59

7.26
7.46
7.51

7.14
7.37
7.59

7.02
7.23
7.52

10.17
9.51

9.25
8.59

8.46
7.77

8.12
7.57

8.04
7.39

7.55
7.02

7.57
6.79

7.56
6.77

7.59
6.79

7.33
6.75

SECONDARY MARKETS

Yield (percent per year)
9 F H A mortgages (Section 203)5
10 G N M A securities 6

Activity in secondary markets

F E D E R A L N A T I O N A L MORTGAGE ASSOCIATION

Mortgage holdings (end of period)
11 Total
12

FHA/VA

13

Conventional

Mortgage transactions
14 Purchases

(during

Mortgage commitments
15 Issued
16 To sell 8

(during

113,329
21,028
92,302

122,837
21,702
101,135

142,833
22,168
120,664

158,119
22,593
135,526

159,204
22,640
136,564

159,766
22,573
137,193

161,147
22,700
138,447

163,719
22,682
141,037

166,849
22,691
144,158

171,232
22,656
148,576

23,959

37,202

75,905

8,832

4,993

4,118

4,730

6,761

7,526

9,131

23,689
5,270

40,010
7,608

74,970
10,493

6,185
1,811

4,189
1,159

4,177
221

6,644
0

7,764
112

7,791
30

8,697
323

20,419
547
19,871

24,131
484
23,283

29,959
408
29,552

33,665
352
33,313

32,370
347
32,023

32,454
343
32,112

35,421
337
35,084

38,361
330
38,031

39,960
325
39,635

n.a.
n.a.
n.a.

75,517
73,817

97,727
92,478

191,125
179,208

20,792
19,602

15,512
16,536

12,063
12,105

12,587
10,286

15,885
13,807

18,842
17,532

n.a.
18,159

102,401

114,031

261,637

32,453

17,591

23,366

21,103

20,731

18,908

n.a.

period)
period)

FEDERAL H O M E L O A N MORTGAGE CORPORATION

Mortgage holdings (end of period)8
17 Total
18

FHA/VA

19

Conventional

Mortgage transactions
20 Purchases
21 Sales

(during

Mortgage commitments
22 Contracted

(during

period)

periodf

1. Weighted averages based on sample surveys of mortgages originated by
major institutional lender groups for purchase of newly built homes; compiled by
the Federal Housing Finance Board in cooperation with the Federal Deposit
Insurance Corporation.
2. Includes all fees, commissions, discounts, and " p o i n t s " paid (by the
borrower or the seller) to obtain a loan.
3. Average effective interest rate on loans closed for purchase of newly built
homes, assuming prepayment at the end of ten years.
4. Average contract rate on new commitments for conventional first mortgages; from U.S. Department of Housing and Urban Development (HUD). Based
on transactions on the first day of the subsequent month.
5. Average gross yield on thirty-year, minimum-downpayment first mortgages insured by the Federal Housing Administration (FHA) for immediate
delivery in the private secondary market. Based on transactions on first day of
subsequent month.




6. Average net yields to investors on fully modified pass-through securities
backed by mortgages and guaranteed by the Government National Mortgage
Association (GNMA), assuming prepayment in twelve years on pools of thirtyyear mortgages insured by the Federal Housing Administration or guaranteed by
the Department of Veterans Affairs.
7. Does not include standby commitments issued, but includes standby commitments converted.
8. Includes participation loans as well as whole loans.
9. Includes conventional and government-underwritten loans. The Federal
Home Loan Mortgage Corporation's mortgage commitments and mortgage transactions include activity under mortgage securities swap programs, whereas the
corresponding data for F N M A exclude swap activity.

A38

DomesticNonfinancialStatistics • September 1993

1.54 MORTGAGE DEBT OUTSTANDING 1
Millions of dollars, end of period
1993

1992

Type of holder and property

1989

1990

1991
Q1

Q2

Q3

Q4

QLP

3,537,301

3,751,476

3,890,830

3,933,754

3,%7,017

4,003,714

4,035,405

4,059,391

2,392,742
307,045
757,038
80,476

2,597,175
310,095
765,458
78,748

2,741,824
307,944
761,782
79,281

2,788,987
308,514
753,578
82,676

2,833,318
304,104
746,357
83,237

2,887,877
300,728
731,407
83,702

2,940,165
293,376
718,910
82,953

2,976,623
289,202
710,208
83,359

1,931,537
767,069
389,632
38,876
321,906
16,656
910,254
669,220
106,014
134,370
650
254,214
12,231
26,907
205,472
9,604

1,914,315
844,826
455,931
37,015
334,648
17,231
801,628
600,154
91,806
109,168
500
267,861
13,005
28,979
215,121
10,756

1,846,910
876,284
486,572
37,424
333,852
18,436
705,367
538,358
79,881
86,741
388
265,258
11,547
29,562
214,105
10,044

1,825,983
880,377
492,910
37,710
330,837
18,919
682,338
524,536
77,166
80,278
358
263,269
11,214
29,693
212,865
9,497

1,803,488
884,598
4%,518
38,314
330,229
19,538
659,624
508,545
74,788
75,947
345
259,266
10,676
29,425
210,139
9,026

1,793,505
891,484
506,658
38,985
325,934
19,906
648,178
501,604
73,723
72,517
334
253,843
10,451
28,804
205,709
8,878

1,769,058
894,549
511,976
38,011
324,681
19,882
627,972
489,622
69,791
68,235
324
246,537
10,158
27,997
199,943
8,439

1,750,365
888,395
508,4%
37,814
322,166
19,919
620,755
486,126
67,491
66,812
327
241,214
9,830
27,454
195,816
8,114

22 Federal and related agencies
23
Government National Mortgage Association
24
One- to four-family
25
Multifamily
26
Farmers Home Administration 4
27
One- to four-family
28
Multifamily
29
Commercial
30
Farm
31
Federal Housing and Veterans' Administrations
32
One- to four-family
33
Multifamily
34
Resolution Trust Corporation
35
One- to four-family
36
Multifamily
37
Commercial
38
Farm
39
Federal National Mortgage Association
40
One- to four-family
41
Multifamily
42
Federal Land Banks
43
One- to four-family
44
Farm
45
Federal Home Loan Mortgage Corporation
46
One- to four-family
47
Multifamily

197,778
23
23
0
41,176
18,422
9,054
4,443
9,257
6,087
2,875
3,212
0
0
0
0
0
99,001
90,575
8,426
29,640
1,210
28,430
21,851
18,248
3,603

239,003
20
20
0
41,439
18,527
9,640
4,690
8,582
8,801
3,593
5,208
32,600
15,800
8,064
8,736
0
104,870
94,323
10,547
29,416
1,838
27,577
21,857
19,185
2,672

266,146
19
19
0
41,713
18,496
10,141
4,905
8,171
10,733
4,036
6,697
45,822
14,535
15,018
16,269
0
112,283
100,387
11,896
28,767
1,693
27,074
26,809
24,125
2,684

278,3%
19
19
0
41,791
18,488
10,270
4,%1
8,072
11,332
4,254
7,078
49,345
15,458
16,266
17,621
0
118,238
105,869
12,369
28,776
1,693
27,083
28,895
26,182
2,713

278,091
23
23
0
41,628
17,718
10,356
4,998
8,557
11,480
4,403
7,077
44,624
15,032
13,316
16,276
0
122,939
110,223
12,716
28,775
1,693
27,082
28,621
26,001
2,620

277,485
27
27
0
41,671
17,292
10,468
5,072
8,839
11,768
4,531
7,236
37,099
12,614
11,130
13,356
0
126,476
113,407
13,069
28,815
1,695
27,119
31,629
29,039
2,591

285,%5
30
30
0
41,695
16,912
10,575
5,158
9,050
12,581
5,153
7,428
32,045
12,960
9,621
9,464
0
137,584
124,016
13,568
28,365
1,669
26,6%
33,665
31,032
2,633

288,199
45
37
8
41,724
16,418
10,679
5,226
9,402
13,950
6,159
7,791
27,331
11,375
8,070
7,886
0
141,192
127,252
13,940
28,536
1,679
26,857
35,421
32,831
2,589

48 Mortgage pools or trusts 5
49
Government National Mortgage Association
50
One- to four-family
51
Multifamily
52
Federal Home Loan Mortgage Corporation
53
One- to four-family
54
Multifamily
55
Federal National Mortgage Association
56
One- to four-family
57
Multifamily
58
Farmers Home Administration
59
One- to four-family
60
Multifamily
61
Commercial
62
Farm
63
Private mortgage conduits
64
One- to four-family
65
Multifamily
66
Commercial
67
Farm

917,848
368,367
358,142
10,225
272,870
266,060
6,810
228,232
219,577
8,655
80
21
0
26
33
48,299
43,325
462
4,512
0

1,079,103
403,613
391,505
12,108
316,359
308,369
7,990
299,833
291,194
8,639
66
17
0
24
26
59,232
53,335
731
5,166
0

1,250,666
425,295
415,767
9,528
359,163
351,906
7,257
371,984
362,667
9,317
47
11
0
19
17
94,177
84,000
3,698
6,479
0

1,288,823
421,977
412,574
9,404
367,878
360,887
6,991
389,853
380,617
9,236
43
10
0
18
16
109,071
95,600
4,686
8,784
0

1,341,338
422,922
413,828
9,094
382,797
376,177
6,620
413,226
403,940
9,286
43
9
0
18
15
122,350
105,700
5,7%
10,855
0

1,385,460
422,255
413,063
9,192
391,762
385,400
6,362
429,935
420,835
9,100
41
9
0
18
14
141,468
123,000
5,7%
12,673
0

1,425,546
419,516
410,675
8,841
407,514
401,525
5,989
444,979
435,979
9,000
38
8
0
17
13
153,499
132,000
6,305
15,194
0

1,459,899
421,514
412,798
8,716
420,932
415,279
5,654
457,316
448,483
8,833
36
7
0
17
13
160,100
137,000
6,858
16,242
0

68 Individuals and others 6
69
One- to four-family
70
Multifamily
71
Commercial
72
Farm

490,138
303,181
84,800
86,310
15,846

519,055
330,378
86,695
87,905
14,077

527,108
327,704
84,842
99,411
15,150

540,552
338,676
84,932
98,213
18,732

544,100
342,832
84,698
97,8%
18,675

547,263
348,252
84,272
%,129
18,610

554,836
356,451
83,617
96,218
18,549

560,929
362,853
83,306
%,043
18,727

1 All holders
2
3
4
5

By type of property
One- to four-family residences
Multifamily residences
Commercial
Farm

By type of holder
6 Major financial institutions
7
Commercial banks
8
One- to four-family
9
Multifamily
10
Commercial
11
Farm
12
Savings institutions
13
One- to four-family
14
Multifamily
15
Commercial
16
Farm
17
Life insurance companies
18
One- to four-family
19
Multifamily
20
Commercial
21
Farm

1. Based on data from various institutional and governmental sources; figures
for some quarters estimated in part by the Federcd Reserve. Multifamily debt
refers to loans on structures of five or more units.
2. Includes loans held by nondeposit trust companies but not loans held by
bank trust departments.
3. Includes savings banks and savings and loan associations.
4. FmHA-guaranteed securities sold to the Federal Financing Bank were
reallocated from F m H A mortgage pools to F m H A mortgage holdings in 1986:Q4
because of accounting changes by the Farmers Home Administration.




5. Outstanding principal balances of mortgage-backed securities insured or
guaranteed by the agency indicated.
6. Other holders include mortgage companies, real estate investment trusts,
state and local credit agencies, state and local retirement funds, noninsured
pension funds, credit unions, and finance companies.
SOURCE. Line 64, Inside Mortgage Securities.

Consumer Installment

Credit

A39

1.55 CONSUMER INSTALLMENT CREDIT1
Millions of dollars, amounts outstanding, end of period
1992
Holder and type of credit

1990

1991

1993

1992
Dec.

Jan.

Feb.

Mar.

Apr. r

May

Seasonally adjusted
1 Total

738,765

733,510

741,093

741,093

744,196

748,765

751,727

754,719

753,917

2 Automobile
3 Revolving
4 Other

284,739
222,552
231,474

260,898
243,564
229,048

259,627
254,299
227,167

259,627
254,299
227,167

258,463
256,435
229,299

260,945
259,378
228,443

261,449
260,990
229,288

261,826
262,700
230,193

263,552
263,642
226,723

Not seasonally adjusted
752,883

749,052

756,944

756,944

749,153

746,914

744,713

748,955

748,375

By major holder
Commercial banks
Finance companies
Credit unions
Retailers
Savings institutions
Gasoline companies
Pools of securitized assets

347,087
133,258
93,057
43,464
52,164
4,822
79,030

340,713
121,937
92,681
39,832
45,965
4,362
103,562

331,869
117,127
97,641
42,079
43,461
4,365
120,402

331,869
117,127
97,641
42,079
43,461
4,365
120,402

330,355
116,009
98,261
40,057
43,428
4,366
116,677

330,060
112,686
98,785
38,462
43,516
4,148
119,257

329,764
111,854
99,778
38,030
43,255
4,080
117,952

331,649
112,523
101,534
38,218
43,451
4,280
117,300

333,314
109,251
102,967
38,681
43,785
4,486
115,891

By major type of credit*
13 Automobile
14
Commercial banks
Finance companies
15
16
Pools of securitized assets

284,903
124,913
75,045
24,620

261,219
112,666
63,415
28,915

259,964
109,743
57,605
33,878

259,964
109,743
57,605
33,878

257,744
109,671
57,165
32,388

259,344
111,005
54,036
36,031

259,089
111,287
53,508
36,096

260,224
111,351
53,977
36,178

262,407
113,322
53,907
35,974

17 Revolving
Commercial banks
18
Retailers
19
Gasoline companies
20
21
Pools of securitized assets 2

234,801
133,385
38,448
4,822
45,637

256,876
138,005
34,712
4,362
63,595

267,949
132,582
36,629
4,365
74,243

267,949
132,582
36,629
4,365
74,243

261,217
129,567
34,666
4,366
71,927

258,430
127,877
33,110
4,148
72,024

257,544
128,079
32,681
4,080
70,890

259,015
129,464
32,838
4,280
69,919

260,506
130,531
33,254
4,486
69,054

22 Other
Commercial banks
23
24
Finance companies
Retailers
25
26
Pools of securitized assets

233,178
88,789
58,213
5,016
8,773

230,957
90,042
58,522
5,120
11,052

229,031
89,544
59,522
5,450
12,281

229,031
89,544
59,522
5,450
12,281

230,192
91,117
58,844
5,391
12,362

229,141
91,178
58,651
5,352
11,202

228,080
90,398
58,346
5,349
10,966

229,716
90,834
58,546
5,380
11,203

225,462
89,461
55,344
5,427
10,863

5 Total
6
7
8
9
10
11
12

1. The Board's series on amounts of credit covers most short- and
intermediate-term credit extended to individuals that is scheduled to be repaid (or
has the option of repayment) in two or more installments.
Data in this table also appear in the Board's G.19 (421) monthly statistical
release. For ordering address, see inside front cover.

2. Outstanding balances of pools upon which securities have been issued; these
balances are no longer carried on the balance sheets of the loan originator.
3. Totals include estimates for certain holders for which only consumer credit
totals are available.

1.56 TERMS OF CONSUMER INSTALLMENT CREDIT1
Percent per year except as noted
1993

1992
Item

1990

1991

1992
Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

INTEREST RATES

Commercial banks2
48-month new car
24-month personal
120-month mobile home
Credit card

11.78
15.46
14.02
18.17

11.14
15.18
13.70
18.23

9.29
14.04
12.67
17.78

8.60
13.55
12.36
17.38

n.a.
n.a.
n.a.
n.a.

n.a.
n.a.
n.a.
n.a.

8.57
13.57
12.38
17.26

n.a.
n.a.
n.a.
n.a.

n.a.
n.a.
n.a.
n.a.

8.17
13.63
12.00
17.15

Auto finance companies
5 New car
6 Used car

12.54
15.99

12.41
15.60

9.93
13.80

9.65
13.37

9.65
13.66

10.08
13.72

10.32
13.90

9.95
13.21

9.61
12.74

9.51
12.61

54.6
46.0

55.1
47.2

54.0
47.9

54.1
47.8

53.6
47.7

53.9
49.2

54.3
49.0

54.6
49.0

54.5
48.9

54.4
48.9

87
95

88
%

89
97

89
97

90
97

90
97

91
98

90
98

90
98

91
98

12,071
8,289

12,494
8,884

13,584
9,119

14,043
9,475

14,315
9,464

13,975
9,472

13,849
9,457

14,013
9,641

14,021
9,731

14,146
9,829

1
2
3
4

OTHER TERMS3

Maturity (months)
7 New car
8 Used car
Loan-to-value
9 New car
10 Used car

ratio

Amount financed
11 New car
12 Used car

(dollars)

1. Data in this table also appear in the Board's G.19 (421) monthly statistical
release. For ordering address, see inside front cover.




2. Data are available for only the second month of each quarter,
3. At auto finance companies.

A40
1.57

Domestic Financial Statistics • September 1993
F U N D S RAISED IN U.S. CREDIT MARKETS1
Billions of dollars; quarterly data at seasonally adjusted annual rates
1991
1988

1989

1990

1991

1992

1993

1992
Q3

Q4

Ql

Q2

Q3

Q4

Ql

Nonfinancial sectors
1 Total net borrowing by domestic nonfinancial sectors . .

775.8

740.8

665.0

461.0

574.4

411.5

403.8

672.2

560.3

486.7

578.2

539.2

By sector and instrument
2 U.S. government
3
Treasury securities
Agency issues and mortgages
4

155.1
137.7
17.4

146.4
144.7
1.6

246.9
238.7
8.2

278.2
292.0
-13.8

304.0
303.8
.2

288.4
317.2
-28.8

320.4
316.6
3.8

368.9
380.1
-11.2

351.9
351.5
.4

193.4
184.4
9.0

301.7
299.1
2.7

274.7
271.6
3.2

5 Private

620.7

594.4

418.2

182.8

270.4

123.1

83.4

303.3

208.5

293.2

276.5

264.4

6
7
8
9
10
U
12
13
14
15
16

By instrument
Tax-exempt obligations
Corporate bonds
Mortgages
Home mortgages
Multifamily residential
Commercial
Farm
Consumer credit
Bank loans n.e.c
Open market paper
Other

53.7
103.1
317.3
241.8
16.7
60.8
-2.1
50.1
41.0
11.9
43.6

65.0
73.8
303.0
245.3
16.4
42.7
-1.5
41.7
40.2
21.4
49.3

51.2
47.1
244.0
219.4
3.7
21.0
-.1
17.5
4.4
9.7
44.2

45.8
78.8
138.5
144.6
-2.4
-4.3
.5
-13.1
-33.3
-18.4
-15.6

53.3
67.3
140.9
198.3
-14.6
-42.9
.1
9.3
-17.7
8.6
8.6

53.5
81.6
53.3
135.4
-36.3
-45.3
-.4
-24.8
-18.2
-36.3
13.8

45.5
60.2
106.3
128.4
10.2
-32.4
.0
-11.9
-65.3
-7.0
-44.3

52.0
76.3
194.1
225.0
2.4
-32.5
-.8
-2.0
-22.9
13.3
-7.5

73.0
77.8
96.5
140.9
-17.7
-28.9
2.2
-15.5
-22.9
-3.1
2.7

52.3
61.3
140.9
212.6
-13.6
-60.0
1.9
9.2
-4.5
.5
33.5

35.9
53.7
132.3
214.9
-29.5
-50.1
-3.0
45.6
-20.6
23.8
5.8

50.8
75.0
130.8
180.6
-16.7
-34.7
1.6
27.8
-5.4
-9.6
-5.0

17
18
19
20
21
22

By borrowing sector
State and local government
Household
Nonfinancial business
Farm
Nonfarm noncorporate
Corporate

48.9
318.6
253.1
-7.5
61.8
198.8

63.2
305.6
225.6
1.6
50.4
173.6

48.3
254.2
115.6
2.5
26.7
86.4

38.5
160.2
-15.9
2.2
-23.4
5.3

47.0
222.6
.8
.0
-40.1
40.9

37.6
148.3
-62.8
1.9
-65.8
1.2

41.9
136.5
-95.0
-2.2
-51.9
-40.9

46.1
231.5
25.8
-1.4
-22.9
50.0

63.4
157.9
-12.9
6.6
-49.9
30.5

50.0
238.0
5.2
1.0
-38.6
42.8

28.6
262.8
-14.9
-6.2
-49.0
40.3

58.8
224.1
-18.4
2.3
-36.9
16.2

23 Foreign net borrowing in United States
24
Bonds
25
Bank loans n.e.c
Open market paper
26
27
U.S. government loans

6.4
6.9
-1.8
8.7
-7.5

10.2
4.9
-.1
13.1
-7.6

23.9
21.4
-2.9
12.3
-6.9

14.1
14.9
3.1
6.4
-10.2

23.9
17.8
2.3
5.2
-1.4

15.6
15.5
1.4
16.0
-17.2

41.0
22.3
6.5
14.9
-2.7

9.7
4.9
1.5
-8.0
11.4

55.2
21.9
14.1
27.8
-8.5

29.5
21.0
3.9
13.1
-8.6

1.1
23.5
-10.3
-12.1
.0

64.4
76.2
1.8
-21.7
8.0

28 Total domestic plus foreign

782.2

750.9

688.9

475.1

598.2

427.1

444.8

681.8

615.5

516.2

579.3

603.5

Financial sectors
29 Total net borrowing by financial sectors
30
31
32
33

By instrument
U.S. government-related
Sponsored-credit-agency securities
Mortgage pool securities
Loans from U.S. government

34 Private
Corporate bonds
35
36
Mortgages
Bank loans n.e.c
37
Open market paper
38
39
Loans from Federal Home Loan Banks
40
41
42
43
44
45
46
47
48
49

By borrowing sector
Sponsored credit agencies
Mortgage pools
Private
Commercial banks
Bank affiliates
Savings and loan associations
Mutual savings banks
Finance companies
Real estate investment trusts (REITs)
Securitized credit obligation (SCO) issuers




211.4

220.1

187.1

138.4

226.0

146.0

170.0

155.9

233.8

277.7

236.4

228.5

119.8
44.9
74.9
.0

151.0
25.2
125.8
.0

167.4
17.1
150.3
-.1

150.0
9.2
140.9
.0

167.1
40.2
126.9
.0

156.0
20.6
135.5
.0

158.5
32.6
125.9
-.1

137.4
11.5
125.9
.0

222.8
48.3
174.4
.0

165.6
67.7
97.9
.0

142.7
33.5
109.2
.0

172.3
35.4
137.0
.0

91.7
16.2
.3
.6
54.8
19.7

69.1
46.8
.0
1.9
31.3

-11.6
54.3
.9
3.2
-32.0
-38.0

58.8
51.5
.0
7.2
-.7
.8

-10.0
31.8
.4
10.2
-16.7
-35.7

11.6
50.6
2.1
4.5
-12.7
-33.0

18.5
11.4
-.4
8.2
8.8
-9.5

11.0

-11.0

19.7
34.4
.3
1.2
8.6
-24.7

112.1
73.5
.3
5.4
11.6
21.3

93.7
106.1
.2
11.3
-9.7
-14.2

56.2
98.0
-.1
3.1
-64.4
19.6

44.9
74.9
91.7
-3.0
5.2
19.9
1.9
31.5
3.6
32.5

25.2
125.8
69.1
-1.4
6.2
-14.1
-1.4
59.7
-1.9
22.0

17.0
150.3
19.7
-1.1
-27.7
-29.9
-.5
35.6
-1.9
45.2

9.1
140.9
-11.6
-13.3
-2.5
-39.5
-3.5
7.8
.9
38.5

40.2
126.9
58.8
4.5
2.3
-4.7
1.8
16.4
.6
38.0

20.6
135.5
-10.0
-9.2
-6.8
-41.1
-5.5
11.8
-.3
41.1

32.5
125.9
11.6
-14.1
9.6
-25.1
-8.7
12.8
3.6
33.3

11.5
125.9
18.5
7.2
2.7
-20.3
4.3
1.1
1.1
22.4

67.7
97.9
112.1
1.6
10.5
10.0
8.3
28.6
1.3
52.0

33.5
109.2
93.7
8.3
4.0
-11.2
-5.6
55.9
-.9
43.2

35.4
137.0
56.2
6.4
8.1
10.0
6.1
-12.6
1.0
37.1

14.9
.1
3.9
-13.4
5.7
48.3
174.4

11.0

.8
-8.2
2.7
.3
-20.0
.9
34.5

Flow of Funds

A41

1.57 FUNDS RAISED IN U.S. CREDIT MARKETS1—Continued
1991
Transaction category or sector

1988

1989

1990

1991

1992

1993

1992
Q3

Q4

Ql

Q2

Q3

Q4

Ql

All sectors
50 Total net borrowing, all sectors

993.6

971.0

876.0

613.5

824.2

573.1

614.8

837.8

849.4

793.9

815.7

832.0

51
52
53
54
55
56
57
58

274.9
53.7
126.3
317.5
50.1
39.9
75.4
55.8

297.3
65.0
125.5
303.0
41.7
41.9
65.9
30.6

414.4
51.2
102.9
244.3
17.5
2.8
30.7
12.4

428.3
45.8
147.9
139.4
-13.1
-26.9
-44.0
-63.9

471.1
53.3
136.6
141.0
9.3
-8.2
13.1
8.0

444.4
53.5
128.9
53.7
-24.8
-6.7
-37.0
-39.0

479.0
45.5
133.2
108.4
-11.9
-54.3
-4.9
-80.1

506.3
52.0
92.6
193.6
-2.0
-13.2
14.1
-5.6

574.7
73.0
114.5
96.6
-15.5
-4.9
11.2
-.2

359.0
52.3
155.8
141.1
9.2
4.9
25.2
46.3

444.4
35.9
183.3
132.5
45.6
-19.6
2.0
-8.4

447.1
50.8
249.2
130.7
27.8
-.5
-95.7
22.5

U.S. government securities
State and local obligations
Corporate and foreign bonds
Mortgages
Consumer credit
Bank loans n.e.c
Open market paper
Other loans

External corporate equity funds raised in United States
59 Total net share issues

-118.4

-65.7

22.1

198.9

279.6

232.5

268.5

263.6

291.7

286.8

276.5

342.8

60 Mutual funds
61 All other
62
Nonfinancial corporations
63
Financial corporations
64
Foreign shares purchased in United States

6.1
-124.5
-129.5
4.1
.9

38.5
-104.2
-124.2
2.7
17.2

67.9
-45.8
-63.0
9.8
7.4

150.5
48.4
18.3
.0
30.2

215.4
64.3
26.8
6.4
31.2

182.5
50.0
19.0
-3.2
34.1

195.9
72.6
48.0
1.7
22.9

183.5
80.1
46.0
4.1
29.9

236.2
55.5
36.0
8.5
11.0

233.3
53.6
11.0
7.9
34.7

208.4
68.1
14.0
5.0
49.1

274.4
68.4
27.0
7.8
33.6

1. Data in this table also appear in the Board's Z . l (780) quarterly statistical
release, tables F.2 through F.5. For ordering address, see inside front cover.




A42
1.58

Domestic Financial Statistics • September 1993
SUMMARY OF FINANCIAL TRANSACTIONS1
Billions of dollars except as noted; quarterly data at seasonally adjusted annual rates
1992

1991

Transaction category or sector

1988

1989

1990

1991

1993

1992
Q3

Q4

Ql

Q2

Q3

Q4

QL

N E T L E N D I N G IN C R E D I T MARKETS2
1

Total net lending in credit markets

Private domestic nonfinancial sectors
Households
Nonfarm noncorporate business
Nonfinancial corporate business
State and local governments
U.S. government
Foreign
Financial sectors
Sponsored credit agencies
Mortgage pools
Monetary authority
Commercial banking
U.S. commercial banks
Foreign banking offices
Bank affiliates
Banks in U.S. possession
Private nonbank finance
Thrift institutions
Savings and loan associations
Mutual savings banks
72
Credit unions
Insurance
73
24
Life insurance companies
25
Other insurance companies
26
Private pension funds
27
State and local government retirement funds
78
Finance n.e.c
29
Finance companies
30
Mutual funds
31
Money market funds
32
Real estate investment trusts (REITs)
33
Brokers and dealers
34
Securitized credit obligation (SCOs) issuers . . .

2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21

993.6

971.0

876.0

613.5

824.2

573.1

614.8

837.8

849.4

793.9

815.7

832.0

226.2
198.9
3.1
5.7
18.6
-10.6
96.3
681.8
37.1
74.9
10.5
157.1
127.1
29.4
-.1
.7
402.2
119.0
• 87.4
15.3
16.3
186.2
103.8
29.2
18.1
35.1
96.9
49.2
11.9
10.7
.9
-8.2
32.5

209.6
179.5
-.8
12.9
17.9
-3.1
74.1
690.4
-.5
125.8
-7.3
176.8
145.7
26.7
2.8
1.6
395.7
-91.0
-93.9
-4.8
7.7
207.7
93.1
29.7
36.2
48.7
278.9
69.3
23.8
67.1
.5
96.3
22.0

203.8
172.3
-1.4
6.6
26.2
33.7
58.4
580.2
16.4
150.3
8.1
125.4
95.2
28.4
-2.8
4.5
279.9
-151.9
-143.9
-16.5
8.5
188.5
94.4
26.5
16.6
51.0
243.3
41.6
41.4
80.9
-.7
34.9
45.2

31.8
.4
-2.3
17.5
16.3
10.0
42.6
529.1
14.2
140.9
31.1
84.0
38.9
48.5
-1.5
-1.9
259.0
-144.9
-140.9
-15.5
11.5
219.5
83.2
34.7
64.7
37.0
184.4
-22.5
90.3
30.1
-1.0
49.0
38.5

75.0
79.9
-2.2
8.8
-11.5
-12.7
95.3
666.5
68.7
126.9
27.9
91.9
69.5
16.5
5.7
.3
351.1
-61.7
-76.7
-1.4
16.4
178.9
89.7
17.3
36.9
35.0
233.9
21.5
132.3
1.3
.6
40.2
38.0

-131.1
-170.1
-1.9
28.8
12.1
-2.1
37.3
669.0
31.7
135.5
48.1
82.4
26.5
56.7
2.4
-3.3
371.3
-176.8
-156.3
-30.8
10.3
259.0
73.8
36.8
115.0
33.4
289.2
-5.4
117.1
1.1
-.6
135.8
41.1

-25.9
-67.8
-2.8
26.6
18.2
-17.9
71.0
587.6
19.7
125.9
22.3
104.3
45.6
61.3
-1.1
-1.5
315.3
-49.5
-83.3
11.5
22.3
159.2
13.2
32.1
96.9
17.0
205.6
-54.9
124.8
53.8
-1.9
50.5
33.3

162.4
181.9
-1.9
-1.4
-16.1
13.9
88.4
573.0
93.1
125.9
33.2
98.9
91.9
.6
6.4
.0
222.0
-113.1
-137.9
7.6
17.2
110.7
80.6
33.1
-32.2
29.2
224.4
39.2
99.1
65.8
.3
-2.4
22.4

118.0
105.3
-2.6
11.8
3.4
-24.9
139.2
617.0
39.9
174.4
9.8
58.4
.5
58.6
-.6
-.1
334.5
-81.4
-92.4
-7.4
18.5
183.9
81.9
22.2
49.7
30.0
232.0
-22.3
169.0
-24.8
2.6
73.0
34.5

-166.4
-159.0
-2.2
10.6
-15.9
-27.0
63.4
924.0
76.5
97.9
10.8
157.4
132.0
6.5
18.5
.4
581.3
-40.5
-38.5
-13.0
247.1
96.5
2.5
109.8
38.2
374.8
8.5
150.7
-16.3
-.3
180.3
52.0

186.1
191.5
-2.2
14.3
-17.6
-12.8
90.3
552.1
65.3
109.2
57.8
53.1
53.4
.4
-1.6
.8
266.8
-11.8
-38.1
7.4
18.9
174.0
99.9
11.2
20.3
42.6
104.5
60.5
110.4
-19.2
-.1
-90.2
43.2

-20.4
-1.5
-2.0
-9.2
-7.7
-16.7
86.1
783.1
16.9
137.0
49.6
131.7
103.9
27.9
-1.2
1.1
447.9
-14.7
-32.5
-9.5
27.3
192.8
74.3
9.4
60.6
48.5
269.8
11.1
161.0
-16.8
.8
76.5
37.1

11.0

RELATION OF LIABILITIES
TO F I N A N C I A L ASSETS
35

Net flows through credit markets

993.6

971.0

876.0

613.5

824.2

573.1

614.8

837.8

849.4

793.9

815.7

832.0

36
37
38
39
40
41
47
43
44
45
46
47
48
49
50
51
52
53
54

Other financial sources
Official foreign exchange
Treasury currency and special drawing rights
Life insurance reserves
Pension fund reserves
Interbank claims
Deposits at financial institutions
Checkable deposits and currency
Small time and savings deposits
Large time deposits
Money market fund shares
Security repurchase agreements
Foreign deposits
Mutual fund shares
Corporate equities
Security credit
Trade debt
Taxes payable
Noncorporate proprietors' equity
Miscellaneous

4.0
.5
25.3
193.6
2.9
259.9
43.2
120.8
53.6
21.9
23.5
-3.1
6.1
-124.5
3.0
89.2
5.3
-31.2
222.3

24.8
4.1
28.8
221.4
-16.5
290.0
6.1
96.7
17.6
90.1
78.3
1.1
38.5
-104.2
15.6
60.0
2.0
-32.5
269.9

2.0
2.5
25.7
186.8
34.2
96.8
44.2
59.9
-66.7
70.3
-23.5
12.6
67.9
-45.8
3.5
44.1
-.5
-39.3
120.5

-5.9
.0
24.5
268.6
-3.7
61.1
75.8
16.7
-60.9
41.2
-16.4
4.6
150.5
48.4
51.4
10.4
-9.0
-2.7
136.8

-1.6
-1.8
29.9
232.9
50.5
14.5
122.7
-61.1
-79.7
3.9
34.1
-5.5
215.4
64.3
4.2
52.5
7.8
-4.3
186.3

-15.5
.4
19.4
344.1
99.9
27.3
104.5
-42.4
-78.1
4.0
36.3
3.0
182.5
50.0
82.4
47.6
13.1
43.2
39.0

-5.0
.5
19.2
244.2
-32.5
47.8
114.4
13.0
-117.4
26.8
16.0
-5.0
195.9
72.6
120.7
-7.3
-3.2
4.8
204.4

3.5
.1
30.5
125.5
55.4
73.5
88.6
-29.9
-78.8
110.2
10.2
-26.9
183.5
80.1
-72.1
71.1
10.6
-16.7
181.9

-6.5
.3
28.4
178.6
22.1
-77.2
92.8
-89.3
-104.9
-42.3
118.9
-52.5
236.2
55.5
-5.3
38.8
9.4
10.7
260.8

-8.5
.2
33.3
325.8
118.0
194.2
202.7
-83.0
-54.8
-13.0
77.1
65.2
233.3
53.6
84.9
64.8
-.6
-18.2
225.2

5.1
-7.7
27.5
301.6
6.4
-132.4
106.8
-42.1
-80.4
-39.1
-69.7
-8.0
208.4
68.1
9.3
35.1
11.7
7.0
77.3

7.6
.3
27.6
286.1
80.2
99.3
31.9
-111.4
-3.7
33.4
152.2
-3.0
274.4
68.4
31.9
38.3
.1
-12.3
166.1

55

Total financial sources

1,650.2

1,772.7

1,374.3

1,343.9

1,674.7

1,506.5

1,477.1

1,564.6

1,601.2

2,099.8

1,433.0

1,900.2

56
57
58

Floats not included in assets ( - )
U.S. government checking deposits
Other checkable deposits
Trade credit

1.6
.8
-.9

8.4
-3.2
.6

3.3
2.5
21.5

-13.1
2.0
15.0

.7
1.6
22.4

23.9
-2.1
23.8

-73.1
-6.1
-7.1

4.4
16.7
24.3

-11.7
2.5
-7.8

-5.3
-13.9
55.3

15.3
1.1
17.7

-6.2
-18.4
11.1

59
60
61
62
63

Liabilities not identified as assets ( - )
Treasury currency
Interbank claims
Security repurchase agreements
Taxes payable
Miscellaneous

-.1
-3.0
-29.8
6.3
4.4

-.2
-4.4
23.9
2.3
-95.6

.2
1.6
-34.8
6.5
-13.8

-.6
26.2
10.4
5.6
-34.1

-.2
-5.5
11.5
14.4
-38.6

-.2
28.4
36.9
23.4
-195.7

-.1
.2
44.0
11.4
182.3

-.4
13.4
-46.5
1.6
-119.0

-.1
-15.1
86.3
24.5
-95.7

-.3
-2.6
26.1
15.3
27.6

-.1
-17.7
-19.8
16.3
32.8

-.1
10.8
122.4
-10.3
-92.5

64

Total identified to sectors as assets

1,670.7

1,841.0

1,387.5

1,332.5

1,668.5

1,568.1

1,325.7

1,670.2

1,618.4

1,997.7

1,387.6

1,883.4

1. Data in this table also appear in the Board's Z.l (780) quarterly statistical
release, tables F.6 and F.7. For ordering address, see inside front cover.




2. Excludes corporate equities and mutual fund shares,

Flow of Funds

A43

1.59 SUMMARY OF CREDIT MARKET DEBT OUTSTANDING 1
Billions of dollars, end of period

1989

1990

1991

1993

1992

1991
Transaction category or sector

1992
Q4

Q3

Ql

Q2

Q3

Q4

Ql

Nonfinancial sectors
1 Total credit market debt owed by
domestic nonfinancial sectors

10,087.1

10,760.8

11,222.9

11,801.3

11,095.2

11,222.9

11,353.6

11,488.0

11,634.5

11,801.3

11,897.1

By lending sector and instrument
2 U.S. government
3
Treasury securities
4
Agency issues and mortgages

2,251.2
2,227.0
24.2

2,498.1
2,465.8
32.4

2,776.4
2,757.8
18.6

3,080.3
3,061.6
18.8

2,687.2
2,669.6
17.6

2,776.4
2,757.8
18.6

2,859.7
2,844.0
15.8

2.923.3
2.907.4
15.9

2,998.9
2,980.7
18.1

3,080.3
3,061.6
18.8

3,140.2
3,120.6
19.6

5 Private

7,835.9

8,262.6

8,446.6

8,720.9

8,408.0

8,446.6

8,493.9

8,564.7

8,635.6

8,720.9

8,756.9

6
7
8
9
10
11
12
13
14
15
16

By instrument
Tax-exempt obligations
Corporate bonds
Mortgages
Home mortgages
Multifamily residential
Commercial
Farm
Consumer credit
Bank loans n.e.c
Open market paper
Other

1.004.4
926.1
3.647.5
2,515.1
304.4
742.6
85.3
791.8
760.7
107.1
598.4

1,055.6
973.2
3,907.3
2,760.0
305.8
757.6
84.0
809.3
758.0
116.9
642.6

1,101.4
1,051.9
4,045.7
2,904.6
303.3
753.3
84.5
799.9
724.7
98.5
624.5

1,154.7
1,119.2
4,190.2
3,102.9
288.7
710.4
88.2
809.2
707.0
107.1
633.5

1,089.3
1,036.9
4,020.3
2,873.6
300.8
761.4
84.5
790.1
734.1
107.0
630.3

1,101.4
1,051.9
4,045.7
2,904.6
303.3
753.3
84.5
799.9
724.7
98.5
624.5

1,111.5
1,071.0
4.088.7
2.951.8
303.9
745.2
87.9
777.6
713.7
110.4
620.8

1,128.6
1,090.4
4.122.0
2.996.1
299.5
737.9
88.5
776.9
710.3
112.0
624.5

1,145.6
1,105.8
4.158.6
3.050.7
296.1
722.9
88.9
784.5
705.7
108.2
627.3

1,154.7
1,119.2
4,190.2
3,102.9
288.7
710.4
88.2
809.2
707.0
107.1
633.5

1,164.8
1,138.0
4.214.3
3.139.4
284.6
701.7
88.6
794.0
700.9
114.9
630.2

17
18
19
20
21
22

By borrowing sector
State and local government
Household
Nonfinancial business
Farm
Nonfarm noncorporate
Corporate

815.7
3.508.2
3,512.0
139.2
1,177.5
2.195.3

864.0
3,780.6
3,618.0
140.5
1,204.2
2,273.4

902.5
3.944.5
3.599.6
140.1
1.180.7
2,278.7

949.6
4,167.0
3,604.3
143.8
1,140.6
2,319.9

891.4
3,897.0
3.619.6
141.7
1,191.3
2.286.7

902.5
3.944.5
3.599.6
140.1
1.180.7
2,278.7

911.3
3,970.3
3,612.3
141.3
1,174.5
2,296.5

925.9
4,023.0
3,615.8
145.1
1,163.5
2,307.2

942.3
4,087.8
3,605.5
146.2
1,150.8
2,308.5

949.6
4,167.0
3,604.3
143.8
1,140.6
2,319.9

961.6
4,191.5
3,603.8
142.3
1.130.7
2.330.8

254.8

278.6

292.7

307.3

282.2

292.7

282.3

298.3

306.6

307.3

319.5

88.0
21.4
63.0
82.4

109.4
18.5
75.3
75.4

124.2
21.6
81.8
65.2

142.0
23.9
77.7
63.7

118.6
20.0
78.0
65.6

124.2
21.6
81.8
65.2

125.4
22.0
70.5
64.4

130.9
25.5
77.4
64.5

136.2
26.5
80.7
63.3

142.0
23.9
77.7
63.7

161.1
24.4
72.3
61.8

10,341.9

11,039.4

11,515.7

12,108.6

11,377.5

11,515.7

11,635.9

11,786.3

11,941.1

12,108.6

12,216.6

23 Foreign credit market debt held in
United States
24
25
26
27

Bonds
Bank loans n.e.c
Open market paper
U.S. government loans

28 Total credit market debt owed by nonfinancial
sectors, domestic and foreign

Financial sectors

29 Total credit market debt owed by
financial sectors
30
31
32
33
34
35
36
37
38
39

By instrument
U.S. government-related
Sponsored credit-agency securities
Mortgage pool securities
Loans from U.S. government
Private
Corporate bonds
Mortgages
Bank loans n.e.c
Open market paper
Loans from Federal Home Loan Banks

By borrowing sector
40 Sponsored credit agencies
41 Mortgage pools
42 Private financial sectors
43
Commercial banks
44 Bank affiliates
45
Savings and loan associations
46
Mutual savings banks
47
Finance companies
48 Real estate investment trusts (REITs)
49
Securitized credit obligation (SCO) issuers...

2,333.0

2,524.2

2,670.3

2,897.0

2,618.4

2,670.3

2,701.2

2,758.1

2,828.6

2,897.0

2,946.6

1,249.3
373.3
871.0
5.0
1,083.7
491.9
3.4
37.5
409.1
141.8

1,418.4
393.7
1,019.9
4.9
1,105.8
528.2
4.2
38.6
417.7
117.1

1,574.3
402.9
1,166.7
4.8
1,095.9
584.2
5.1
41.8
385.7
79.1

1,741.5
443.1
1,293.5
4.8
1,155.6
627.2
5.1
49.0
394.3
79.9

1,531.1
394.7
1,131.5
4.9
1,087.3
572.8
4.6
39.0
387.0
83.9

1,574.3
402.9
1,166.7
4.8
1,095.9
584.2
5.1
41.8
385.7
79.1

1,603.8
405.7
1,193.2
4.8
1,097.4
581.3
5.0
41.6
393.2
76.3

1,658.3
417.8
1,235.6
4.8
1,099.8
583.7
5.0
43.7
390.5
76.9

1,702.0
434.7
1,262.5
4.8
1,126.6
602.3
5.1
44.5
394.6
80.2

1,741.5
443.1
1,293.5
4.8
1,155.6
627.2
5.1
49.0
394.3
79.9

1,779.7
451.9
1,322.9
4.8
1,167.0
650.0
5.1
47.6
379.3
85.0

378.3
871.0
1,083.7
77.4
142.5
145.2
17.2
504.2
10.1
187.1

398.5
1,019.9
1,105.8
76.3
114.8
115.3
16.7
539.8
10.6
232.3

407.7
1,166.7
1,095.9
63.0
112.3
75.9
13.2
547.5
12.3
271.9

447.9
1,293.5
1,155.6
67.4
114.6
71.1
15.1
563.8
13.6
309.9

399.5
1,131.5
1,087.3
64.6
110.6
79.0
15.2
543.3
11.2
263.6

407.7
1,166.7
1,095.9
63.0
112.3
75.9
13.2
547.5
12.3
271.9

410.5
1,193.2
1,097.4
60.8
115.0
71.2
13.5
546.7
12.7
277.5

422.6
1,235.6
1,099.8
61.7
112.7
70.3
14.3
541.6
13.2
286.1

439.5
1,262.5
1,126.6
63.3
114.4
70.9
16.2
549.1
13.7
299.1

447.9
1,293.5
1,155.6
67.4
114.6
71.1
15.1
563.8
13.6
309.9

456.8
1,322.9
1,167.0
64.8
118.7
74.8
15.7
559.8
14.1
319.2

All sectors

50 Total credit market debt, domestic and foreign..
51
52
53
54
55
56
57
58

U.S. government securities
State and local obligations
Corporate and foreign bonds
Mortgages
Consumer credit
Bank loans n.e.c
Open market paper
Other loans

12,674.9

13,563.6

14,186.0

15,005.6

13,995.8

14,186.0

14,337.1

14,544.4

14,769.7

15,005.6

15,163.3

3,495.6
1,004.4
1,506.0
3,650.9
791.8
819.6
579.2
827.5

3,911.7
1,055.6
1,610.7
3,911.5
809.3
815.1
609.9
839.9

4,345.9
1,101.4
1,760.4
4,050.8
799.9
788.2
565.9
773.5

4,817.0
1,154.7
1,888.5
4,195.4
809.2
780.0
579.0
781.9

4,213.5
1,089.3
1,728.3
4,024.9
790.1
793.2
572.0
784.7

4,345.9
1,101.4
1,760.4
4,050.8
799.9
788.2
565.9
773.5

4,458.7
1,111.5
1,777.8
4,093.8
777.6
777.3
574.1
766.3

4,576.8
1,128.6
1,805.0
4,127.0
776.9
779.5
579.9
770.7

4,696.0
1,145.6
1,844.2
4,163.7
784.5
776.6
583.6
775.5

4,817.0
1,154.7
1,888.5
4,195.4
809.2
780.0
579.0
781.9

4,915.0
1,164.8
1,949.0
4,219.4
794.0
772.8
566.4
781.8

1. Data in this table also appear in the Board's Z.l (780) quarterly statistical
release, tables L.2 through L.4. For ordering address, see inside front cover.




A44

DomesticNonfinancialStatistics • September 1993

1.60 SUMMARY OF FINANCIAL ASSETS AND LIABILITIES1
Billions of dollars except as noted, end of period

1989

1990

1991

1993

1992

1991
Transaction category or sector

1992
Q3

Q4

Ql

Q2

Q3

Q4

Ql

CREDIT MARKET DEBT OUTSTANDING2

1 Total credit market assets
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34

Private domestic nonfinancial sectors
Households
Nonfarm noncorporate business
Nonfinancial corporate business
State and local governments
U.S. government
Foreign
Financial sectors
Sponsored credit agencies
Mortgage pools
Monetary authority
Commercial banking
U.S. commercial banks
Foreign banking offices
Bank affiliates
Banks in U.S. possession
Private nonbank finance
Thrift institutions
Savings and loan associations
Mutual savings banks
Credit unions
Insurance
Life insurance companies
Other insurance companies
Private pension funds
State and local government retirement funds.
Finance n.e.c
Finance companies
Mutual funds
Money market funds
Real estate investment trusts (REITs)
Brokers and dealers
Securitized credit obligation (SCOs) issuers .

12,674.9

13,563.6

14,186.0

15,005.6

13,995.8

14,186.0

14,337.1

14,544.4

14,769.7

15,005.6

15,163.3

2,666.2
1,897.3
52.6
186.3
530.0
252.0
817.2
10,260.3
389.0
1,131.5
264.7
2,817.8
2,488.7
297.5
11.6
20.0
5,657.2
1,205.1
826.1
208.7
170.2
2,508.7
1,201.4
370.7
466.6
470.1
1,943.5
647.5
421.4
389.5
7.2
214.3
263.6

2,552.8
1,760.5
52.6
203.4
536.2
246.2
835.1
10,552.0
397.7
1,166.7
272.5
2,853.3
2,502.5
319.2
11.9
19.7
5,861.7
1,190.7
804.2
211.5
174.9
2,676.8
1,199.6
378.7
624.2
474.3
1,994.3
635.5
450.5
402.7
6.8
226.9
271.9

2,559.5
1,784.6
51.4
192.1
531.4
250.2
857.2
10,670.2
419.9
1,193.2
271.8
2,860.6
2,514.0
313.3
13.6
19.7
5,924.8
1,161.8
771.1
213.4
177.3
2,709.0
1,224.3
387.0
616.1
481.6
2,053.9
640.5
478.8
424.0
6.8
226.3
277.5

2,561.6
1,773.4
50.8
204.2
533.3
245.3
892.0
10,845.5
429.0
1,235.6
282.6
2,882.9
2,521.9
328.2
13.1
19.7
6,015.4
1,143.1
748.8
211.6
182.7
2,757.3
1,247.1
392.5
628.5
489.1
2,115.0
641.2
522.0
413.5
7.5
244.6
286.1

2,551.6
1,776.1
50.2
197.7
527.6
238.1
908.2
11,071.8
446.3
1,262.5
285.2
2,922.9
2,556.7
328.9
17.5
19.8
6,155.0
1,133.7
737.9
208.3
187.4
2,818.1
1,270.3
393.1
656.0
498.7
2,203.1
640.7
557.5
408.8
7.4
289.6
299.1

2,622.8
1,835.5
50.4
212.3
524.7
233.5
930.8
11,218.5
466.4
1,293.5
300.4
2,945.2
2,571.9
335.8
17.6
20.0
6,212.9
1,129.0
727.5
210.2
191.3
2,855.7
1,289.4
396.0
661.1
509.3
2,228.2
656.9
582.8
404.1
7.4
267.1
309.9

2,599.4
1,829.5
49.2
198.8
521.9
229.8
943.7
11,390.4
470.2
1,322.9
303.6
2,961.1
2,587.0
336.5
17.4
20.2
6,332.7
1,124.8
720.8
207.8
196.2
2,908.9
1,313.0
398.3
676.2
521.5
2,298.9
654.8
626.6
404.5
7.6
286.2
319.2

14,186.0

14,337.1

14,544.4

14,769.7

15,005.6

15,163.3

2,440.5
1,710.1
56.4
180.3
493.7
205.1
734.2
9,295.1
367.2
871.0
233.3
2,643.9
2,368.4
242.3
16.2
17.1
5,179.7
1,484.9
1,088.9
241.1
154.9
2,140.3
1,013.1
317.5
394.7
414.9
1,554.5
617.1
307.2
291.8
8.4
142.9
187.1

2,644.2
1,882.3
55.0
186.9
519.9
238.7
792.4
9,888.3
383.6
1,019.9
241.4
2,769.3
2,463.6
270.8
13.4
21.6
5,474.1
1,335.5
945.1
227.1
163.4
2,329.1
1,116.5
344.0
431.3
437.4
1,809.4
658.7
360.2
372.7
7.7
177.9
232.3

2,552.8
1,760.5
52.6
203.4
536.2
246.2
835.1
10,552.0
397.7
1,166.7
272.5
2,853.3
2,502.5
319.2
11.9
19.7
5,861.7
1,190.7
804.2
211.5
174.9
2,676.8
1,199.6
378.7
624.2
474.3
1,994.3
635.5
450.5
402.7
6.8
226.9
271.9

2,622.8
1,835.5
50.4
212.3
524.7
233.5
930.8
11,218.5
466.4
1,293.5
300.4
2,945.2
2,571.9
335.8
17.6
20.0
6,212.9
1,129.0
727.5
210.2
191.3
2,855.7
1,289.4
396.0
661.1
509.3
2,228.2
656.9
582.8
404.1
7.4
267.1
309.9

12,674.9

13,563.6

14,186.0

15,005.6

13,995.8

53.6

61.3

55.4

51.8

52.9

55.4

52.7

54.4

55.4

51.8

54.5

23.8
354.3
3,210.5
32.4
4,644.6
888.6
2,265.4
615.4
428.1
403.2
43.9
566.2
133.9
903.9
81.8
2,508.3

26.3
380.0
3,303.0
64.0
4,741.4
932.8
2,325.3
548.7
498.4
379.7
56.6
602.1
137.4
938.0
81.4
2,678.8

26.3
402.0
4,208.8
65.2
4,802.5
1,008.5
2,342.0
487.9
539.6
363.4
61.2
813.9
188.9
940.9
72.3
2,817.3

24.5
431.9
4,573.7
115.4
4,817.0
1,131.0
2,281.0
408.4
543.6
397.5
55.6
1,050.2
217.3
1,003.6
80.1
2,931.8

26.2
397.2
3,717.7
60.9
4,769.5
948.3
2,339.7
517.1
533.1
368.9
62.4
744.2
158.1
935.3
71.9
2,733.9

26.3
402.0
4,208.8
65.2
4,802.5
1,008.5
2,342.0
487.9
539.6
363.4
61.2
813.9
188.9
940.9
72.3
2,817.3

26.3
409.6
4,226.3
67.2
4,796.4
984.3
2,340.9
469.7
572.0
375.1
54.4
860.4
194.6
939.8
77.4
2,834.5

26.4
416.7
4,278.7
70.8
4,785.1
1,032.3
2,314.7
438.7
557.2
401.0
41.3
928.3
193.3
944.9
72.7
2,876.0

26.5
425.0
4,418.1
101.6
4,829.9
1,071.6
2,293.3
428.8
553.2
425.4
57.6
971.2
214.5
987.7
75.8
2,911.5

24.5
431.9
4,573.7
115.4
4,817.0
1,131.0
2,281.0
408.4
543.6
397.5
55.6
1,050.2
217.3
1,003.6
80.1
2,931.8

24.6
438.8
4,688.0
123.5
4,818.6
1,093.2
2,259.7
409.2
556.6
444.9
54.9
1,155.7
224.8
993.6
82.6
2,953.8

RELATION OF LIABILITIES
TO F I N A N C I A L ASSETS

35 Total credit market debt
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52

Other liabilities
Official foreign exchange
Treasury currency and special drawing rights
certificates
Life insurance reserves
Pension fund reserves
Interbank claims
Deposits at financial institutions
Checkable deposits and currency
Small time and savings deposits
Large time deposits
Money market fund shares
Security repurchase agreements
Foreign deposits
Mutual fund shares
Security credit
Trade debt
Taxes payable
Miscellaneous

25,188.3

26,577.2

28,579.6

30,303.0

27,663.7

28,579.6

28,822.3

29,191.8

29,786.8

30,303.0

30,721.8

Financial assets not included in liabilities (+)
54 Gold and special drawing rights
55 Corporate equities
56 Household equity in noncorporate business

21.0
3,819.7
2,524.9

22.0
3,506.6
2,449.4

22.6
4,357.9
2,366.0

19.6
4,827.2
2,260.8

22.1
4,170.5
2,493.4

22.6
4,357.9
2,366.0

22.7
4,461.9
2,365.5

23.2
4,404.7
2,346.4

24.5
4,576.8
2,322.2

19.6
4,827.2
2,260.8

19.8
4,964.0
2,260.9

Floats not included in assets ( - )
57 U.S. government checking deposits
58 Other checkable deposits
59 Trade credit

6.1
26.5
-159.7

15.0
28.9
-148.0

3.8
30.9
-138.5

6.8
32.5
-105.9

19.8
23.6
-157.7

3.8
30.9
-138.5

.9
29.5
-135.3

1.4
32.6
-149.5

4.0
23.3
-131.3

6.8
32.5
-105.9

3.4
22.2
-104.0

-4.3
-31.0
11.5
20.6
-251.1

-4.1
-32.0
-23.3
21.8
-247.3

-4.8
-4.2
-12.9
18.9
-458.5

-5.0
-9.9
-2.8
32.0
-558.3

-4.7
-4.7
-10.6
17.6
-300.6

-4.8
-4.2
-12.9
18.9
-458.5

-4.9
-1.8
-11.4
14.7
-458.1

-4.9
-4.0
5.8
20.9
-476.5

-5.0
-5.9
16.7
25.4
-527.9

-5.0
-9.9
-2.8
32.0
-558.3

-5.0
-7.5
41.4
29.2
-540.0

31,935.2

32,944.3

35,891.3

38,021.1

34,767.1

35,891.3

36,238.9

36,540.2

37,311.0

38,021.1

38,526.9

53 Total liabilities

60
61
62
63
64

Liabilities not identified as assets ( - )
Treasury currency
Interbank claims
Security repurchase agreements
Taxes payable
Miscellaneous

65 Total identified to sectors as assets

1. Data in this table also appear in the Board's Z.l (780) quarterly statistical
release, tables L.6 and L.7. For ordering address, see inside front cover.




2. Excludes corporate equities and mutual fund shares,

Selected Measures
2.10

N O N F I N A N C I A L B U S I N E S S ACTIVITY

A45

Selected Measures

Monthly data seasonally adjusted, and indexes 1987=100, except as noted
1993

1992
1990

Measure

1991

1992
Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

June

1
1 Industrial production

106.0

104.1

106.5

107.5

108.4

108.9

109.3

109.9

110.1

110.4 r

110.3 r

110.1

Market groupings
Products, total
Final, total
Consumer goods
Equipment
Intermediate
Materials

105.5
107.0
103.4
112.1
101.2
106.8

103.1
105.3
102.8
108.9
96.5
105.5

105.6
108.2
105.2
112.7
97.6
107.9

107.1
110.1
106.4
115.4
97.8
108.1

107.8

107.1
116.7
98.1
109.3

108.2
111.5
107.5
117.2
98.3
110.0

108.5
111.9
107.6
118.1
98.2
110.4

109.2
112.4
108.5
118.0
99.3
110.9

109.5
112.7r
108.6r
118.7 r
99.6
110.9

109.5
112.8r
108.3 r
119.4 r
99.6 r
111.6 r

109.4 r
112.6 r
107.9*
119.5
99.6
111.6

109.1
112.2
107.1
119.6
99.5
111.6

106.1

103.7

106.9

108.0

108.9

109.2

109.9

110.5

110.8r

111.3 r

111.2'

110.8

81.1

77.8

78.8

?
3
4
5
6
7

Industry groupings
8 Manufacturing
9 Capacity utilization, manufacturing
(percent) 2
3

111.0

79.2

79.7

79.8

80.3

80.5

80.6

80.9*

80.7 r

80.3

r

104.0

92.0

90.0

100.0

95.0

94.0

94.0

91.0

104.0

106.7
93.2
94.3
93.9

107.0
93.2
94.3
94.1
111.4
136.6
132.3
118.0
138.2
131.9

107.1
93.2
94.4
94.3
111.6
137.4
133.1
117.2
138.8
132.0

107.4
93.5
94.5
94.5
111.9
137.5
132.9
117.8
139.0
131.9

107.5
93.3
94.4
94.4
112.0
138.4
132.8
117.8
140.0
130.5

107.7
93.1
94.0
94.0
112.4 r
138.5
133.3
118.1
140.1
133.0*

107.9
93.2
93.8
93.8
112.6
139.3
134.6
118.0
140.9
133.5r

107.9
92.9
93.5
93.5
112.7
n.a.
n.a.
n.a.
n.a.
134.0

141.9
123.8

142.6
124.2

143.1
124.5r

143.6
124.6

144.0
125.3

144.2
125.7

144.4
125.6

95.3

89.7

94.5

11 Nonagricultural employment, total 4
Goods-producing, total
17
Manufacturing, total
13
Manufacturing, production workers . . .
14
15
Service-producing
16 Personal income, total
Wages and salary disbursements
17
Manufacturing
18
19
Disposable personal income
20 Retail sales 6

107.7
101.2
100.6
100.2
109.8
122.7
121.3
113.5
122.9
120.2

106.2
96.6
97.1
96.3
109.3
127.0
124.4
113.6
128.0
121.3

106.4
94.9
95.8
95.3
110.0
133.0
129.0
115.4
134.7
127.l r

135.3
130.5
116.5
137.0
130.7

106.8
93.2
94.3
94.0
111.2
135.3
131.2
116.0
136.8
130.5

Prices7
71 Consumer (1982-84=100)
22 Producer finished goods (1982=100)

130.7
119.2

136.2
121.7

140.3
123.2

141.8
124.4

142.0
124.0

10 Construction contracts

111.0

1. A major revision of the industrial production index and the capacity
utilization rates was released in April 1990. See "Industrial Production: 1989
Developments and Historical Revision," Federal Reserve Bulletin, vol. 76 (April
1990), pp. 187-204.
2. Ratio of index of production to index of capacity. Based on data from the
Federal Reserve, DRI McGraw-Hill, U.S. Department of Commerce, and other
sources.
3. Index of dollar value of total construction contracts, including residential,
nonresidential, and heavy engineering, from McGraw-Hill Information Systems
Co., F.W. Dodge Division.
4. Based on data from U.S. Department of Labor, Employment and Earnings.
Series covers employees only, excluding personnel in the armed forces.
5. Based on data from U.S. Department of Commerce, Survey of Current
Business.

2.11

6. Based on data from U.S. Department of Commerce, Survey of Current
Business.
7. Based on data not seasonally adjusted. Seasonally adjusted data for changes
in the price indexes can be obtained from the U.S. Department of Labor, Bureau
of Labor Statistics, Monthly Labor Review.
NOTE. Basic data (not indexes) for series mentioned in notes 4, 5,and 6, and
indexes for series mentioned in notes 3 and 7 can also be found in the Survey of
Current Business.
Figures for industrial production for the latest month are preliminary, and many
figures for the three months preceding the latest month have been revised. See
"Recent Developments in Industrial Capacity and Utilization," Federal Reserve
Bulletin, vol. 76 (June 1990), pp. 411-35.

LABOR FORCE, EMPLOYMENT, A N D UNEMPLOYMENT
Thousands of persons; monthly data seasonally adjusted except as noted
1993

1992

Category

1990

1991

1992

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May r

June

HOUSEHOLD SURVEY DATA
1

Noninstitutional population1

? Labor force 1
Civilian labor force
3
4
5
6
7
8

Nonagricultural industries
Agriculture
Unemployment
Number
Rate (percent of civilian labor force)
Not in labor force

—

189,686

191,329

193,142

193,847

194,026

194,159

194,298

194,456

194,618

194,767

194,933

126,424
124,787

126,867
125,303

128,548
126,982

128,896
127,365

129,108
127,591

128,598
127,083

128,839
127,327

128,926
127,429

128,833
127,341

129,615
128,131

129,604
128,127

114,728
3,186

114,644
3,233

114,391
3,207

114,855
3,209

115,049
3,262

114,879
3,191

115,335
3,116

115,483
3,082

115,356
3,060

116,203
3,070

116,195
3,024

6,874
5.5
63,262

8,426
6.7
64,462

9,384
7.4
64,594

9,301
7.3
64,951

9,280
7.3
64,918

9,013
7.1
65,561

8,876
7.0
65,459

8,864
7.0
65,530

8,925
7.0
65,785

8,858
6.9
65,152

8,908
7.0
65,329

109,782

108,310

108,434

108,921

109,079

109,235

109,539

109,565

109,820 r

110,035

110,048

19,117
710
5,133
5,808
25,877
6,729
28,130
18,304

18,455
691
4,685
5,772
25,328
6,678
28,323
18,380

18,192
635
4,594
5,741
25,120
6,672
28,903
18,578

17,917
616
4,462
5,699
25,466
6,569
29,430
18,762

17,913
613
4,459
5,707
25,522
6,575
29,524
18,766

17,936
611
4,454
5,719
25,609
6,578
29,573
18,755

17,954
600
4,515
5,725
25,726
6,577
29,665
18,777

17,935
600
4,481
5,724
25,707
6,574
29,756
18,788

17,863R
600R
4,517
5,720*
25,758R
6,585R
29,977R
18,800*

17,820
602
4,572
5,723
25,809
6,590
30,096
18,823

17,767
595
4,566
5,718
25,835
6,587
30,152
18,828

ESTABLISHMENT SURVEY DATA
9
10
11
17
N
14
15
16
17

Nonagricultural payroll employment 3
Manufacturing
Mining
Contract construction
Transportation and public utilities
Trade
Finance
Service
Government

1. Persons sixteen years of age and older, including Resident Armed Forces.
Monthly figures are based on sample data collected during the calendar week that
contains the twelfth day; annual data are averages of monthly figures. By
definition, seasonality does not exist in population figures.
2. Includes self-employed, unpaid family, and domestic service workers.
3. Includes all full- and part-time employees who worked during, or received




pay for, the pay period that includes the twelfth day of the month; excludes
proprietors, self-employed persons, household and unpaid family workers, and
members of the armed forces. Data are adjusted to the March 1984 benchmark,
and only seasonally adjusted data are available at this time.
SOURCE. Based on data from U.S. Department of Labor, Employment and
Earnings.

A46

Domestic Nonfinancial Statistics • September 1993

2.12 OUTPUT, CAPACITY, AND CAPACITY UTILIZATION1
Seasonally adjusted
1992

1993

1993

Series
Q3

Q4

Ql

r

Q2

Output (1987-100)

Q3

Q4

Ql

Q2

Capacity (percent of 1987 output)

Q3

Q4

Qlr

Q2

Capacity utilization rate (percent)

1 Total industry

106.5

108.3

109.7

110.3

133.7

134.2

134.8

135.3

79.7

80.7

81.4

2 Manufacturing

107.0

108.7

110.4

111.1

136.0

136.6

137.2

137.8

78.7

79.6

80.5

80.6

3
4

Primary processing
Advanced processing

103.7
108.5

104.7

106.4
112.3

106.8
113.1

126.4
140.6

126.6
141.3

126.8
142.1

127.1
142.9

82.1
77.2

82.7
78.3

83.9
79.0

84.0
79.2

5
6
7
8
9
10
11
12
13

Durable goods
Lumber and products
Primary metals
Iron and steel
Nonferrous
Nonelectrical machinery
Electrical machinery
Motor vehicles and parts
Aerospace and miscellaneous
transportation equipment

108.3
96.0
99.7
103.5
94.5

110.8

113.6
99.7
105.0
109.1
99.3
137.1
127.1
120.6

114.6
97.0
104.2
108.3
98.5
143.8
129.1

141.9
112.4
125.3
130.4
118.3

142.6
112.5
125.0
129.9

143.4

118.2
162.1

118.1

151.3
152.9

152.6
154.5

163.7
154.1
155.8

76.3
85.4
79.6
79.4
79.8
79.0
80.0
67.7

77.7
87.6

160.6

144.1
112.7
124.9
130.0
117.9
165.5
155.7
156.8

72.1

79.2
88.5
84.1
84.1
84.1
83.8
82.5
77.4

79.5
86.1
83.4
83.4
83.5
86.9
82.9
75.7

99.5

97.7

95.7

93.0

135.7

135.8

135.7

135.5

73.3

72.0

70.5

68.6

14
15
16
17
18
19

Nondurable goods
Textile mill products
Paper and products
Chemicals and products
Plastics materials
Petroleum products

105.4
105.2

106.1
105.2
107.9
116.9

106.5

106.8

128.7

104.8

116.6

112.8

129.6
116.9
122.5
144.4
129.5
115.9

130.1
117.1
122.9
145.4
115.7

81.9
90.3
89.2
80.4
86.2
85.9

82.1

106.2
110.0

129.1
116.7
122.1
143.5

90.1
88.4
81.4
82.8
89.7

82.2
90.8
89.8
80.9
86.2
89.9

89.5
91.7
81.2
86.4
90.7

111.7
132.2
129.0

111.5
132.5
129.4

86.9
84.5
86.4

87.4
87.1
89.0

86.3
87.8
89.3

86.6
87.1
88.9

126.8

120.9
103.6

108.6

114.7
110.5

20 Mining
21 Utilities
22
Electric

110.6

98.5
101.5
105.0
96.7
132.4
124.0
111.4

106.6

100.2

104.2

97.5
110.9

97.9
114.7
114.3

110.6

118.6

116.9
111.7
104.2

118.0
104.9

121.7
142.6
128.3
116.6

96.5

96.5
115.4
115.1

112.3
131.4
127.9

116.0

115.2

1973

1975

Previous cycle

High

Low

High

Low

Latest cycle 3
High

Low

128.8
116.2
112.0

131.8
128.5

112.6

124.9
129.8

1992
June

81.2

80.8
81.8

81.7
81.2

82.1

1993
Jan.

Feb.

Mar/

Apr/

May r

June p

81.2

Capacity utilization rate (percent)
1 Total industry

99.0

82.7

87.3

71.8

84.8

78.3

79.5

81.2

81.5

81.6

81.7

81.5

2 Manufacturing

99.0

82.7

87.3

70.0

85.1

76.6

78.6

80.3

80.5

80.6

80.9

80.7

80.3

Primary processing
Advanced processing

99.0
99.0

82.7
82.7

89.7
86.3

66.8
71.4

89.1
83.3

77.9
76.1

82.2
77.0

83.5
78.9

84.3
79.0

83.8
79.3

84.2
79.5

84.1
79.2

83.8
78.8

5
6
7
8
9
10
11
12
13

Durable goods
Lumber and products
Primary metals
Iron and steel
Nonferrous
Nonelectrical machinery
Electrical machinery
Motor vehicles and parts
Aerospace and miscellaneous
transportation equipment.

99.0
99.0
99.0
99.0
99.0
99.0
99.0
99.0

82.7
82.7
82.7
82.7
82.7
82.7
82.7
82.7

86.9
87.6
102.4
110.4
90.5
92.1
89.4
93.0

65.0
60.9
46.8
38.3
62.2
64.9
71.1
44.5

83.9
93.3
92.9
95.7
88.9
83.7
84.9
84.5

73.8
76.8
74.3
72.3
75.9
73.0
76.8
57.9

76.1
83.5
80.6
79.4
82.3
77.6
79.3
69.1

78.9
88.2
82.3
82.4
82.2
82.8
82.0
77.7

79.4
90.4
86.5
87.0
85.9
83.5
82.5
77.5

79.5
87.0
83.4
82.9
84.3
85.0
83.1
76.9

79.8
86.5
83.5
83.5
83.6
86.4
82.9
77.3

79.6
86.8
83.4
83.2
83.6
86.9
83.1
75.9

79.1
85.0
83.4
83.4
83.4
87.3
82.7
73.8

99.0

82.7

81.1

66.9

88.3

78.1

74.2

71.2

70.6

69.8

69.3

68.7

67.9

14
15
16
17
18
19

Nondurable goods
Textile mill products
Paper and products
Chemicals and products
Plastics materials
Petroleum products

99.0
99.0
99.0
99.0
99.0
99.0

82.7
82.7
82.7
82.7
82.7
82.7

87.0
91.7
94.2
85.1
90.9
89.5

76.9
73.8
82.0
70.1
63.4
68.2

86.8
92.1
94.9
85.9
97.0
88.5

80.4
78.7
86.0
78.5
75.5
84.2

81.9
89.1
89.5
80.9
86.3
87.2

82.2
91.5
88.8
81.1
86.0
89.0

82.1
90.8
90.1
80.4
85.3
90.3

82.2
90.1
90.6
81.3
87.4
90.4

82.4
89.1
92.2
81.1
87.7
90.1

82.1
90.0
91.8
81.2
85.7
91.4

81.8
89.3
91.3
81.3
85.9
90.6

99.0
99.0
99.0

82.7
82.7
82.7

96.6
88.3
88.3

80.6
76.2
78.7

87.0
92.6
94.8

86.8
83.4
87.4

86.3
83.9
85.8

87.9
85.4
87.7

85.8
88.9
90.3

85.3
89.0
90.0

86.4
86.8
88.6

86.9
86.7
88.5

86.4
87.8
89.8

3
4

20 Mining
21 Utilities
Electric
22

1. Data in this table also appear in the Board's G.17 (419) monthly statistical
release. For ordering address, see inside front cover. For a detailed description of
the series, see "Recent Developments in Industrial Capacity and Utilization,"
Federal Reserve Bulletin, vol. 76 (June 1990), pp. 411-35. See also "Industrial




Production Capacity and Capacity Utilization Since 1987," Federal
Bulletin, vol. 79, (June 1993), pp. 590-605.
2. Monthly highs, 1978 through 1980; monthly lows, 1982.
3. Monthly highs, 1988-89; monthly lows, 1990-91.

Reserve

Selected Measures
2.13 INDUSTRIAL PRODUCTION

A47

Indexes and Gross Value1

Monthly data seasonally adjusted

Group

1987
proportion

1993

1992
1992
avg.
June

July

Aug.

Sept.

Oct.

Nov.

Dec.

Jan.

Feb.

Mar. r

Apr. r

May r

June p

Index (1987 = 100)

MAJOR MARKETS

1 Total index

100.0

106.5

106.0

106.8

106.6

106.2

107.5

108.4

108.9

109.3

109.9

110.1

110.4

110.3

110.1

105.7
108.1
104.9
102.8
98.8
95.3
81.2
119.8
104.6
106.3
109.7
101.7
107.4
105.5
105.0
95.1
117.3
100.1
106.3
104.1
107.2

105.9
108.9
105.1
101.9
99.5
96.0
77.0
128.8
105.3
104.0

107.1
110.1
106.4
104.1
103.1
101.5
78.5
141.3
105.9
104.9
110.8
98.5
105.8
107.1
105.9
94.5
121.1
100.1

107.8

97.7
104.1
106.0
107.0
94.0
116.5
100.2
105.6
98.9
108.2

105.3
108.1
104.4
100.9
97.3
93.5
77.9
120.4
103.7
104.1
112.9
98.2
102.9
105.3
104.9
94.3
118.5
100.4
104.6
103.5
105.1

109.8
111.6

107.1
105.7
104.1
102.9
79.6
143.3
106.0
107.1
110.8
103.7
107.1
107.5
105.2
95.9
123.3
100.9
112.0
107.7
113.6

108.2
111.5
107.5
107.9
108.7
111.7
86.9
154.6
103.8
107.2
110.5
105.4
106.6
107.4
104.8
96.0
121.7
100.9
114.4
106.1
117.5

108.5
111.9
107.6
110.9
112.7
116.8
86.6
169.1
105.8
109.3
116.0
105.5
108.0
106.7
104.6
95.7
122.4
100.2
109.5
106.5
110.7

109.2
112.4
108.5
111.3
111.9
114.6
90.2
156.9
107.4
110.7
117.6
106.7
109.5
107.7
105.5
95.0
121.1
101.8
115.5
108.9
118.0

109.5
112.7
108.6
111.5
111.2
113.4
90.5
153.1
107.5
111.7
125.0
104.5
108.9
107.7
104.3
94.6
123.7
102.1
116.0
107.1
119.5

109.5
112.8
108.3
112.1
112.1
114.3
90.2
155.9
108.5
112.0
123.9
105.3
109.6
107.2
104.6
94.8
123.1
101.7
111.7
106.6
113.6

109.4
112.6
107.9
110.8
109.3
110.1
86.5
150.9
108.1
112.1
122.4
108.5
108.7
107.0
104.4
94.6
122.7
101.2
112.6
109.0
113.9

109.1
112.2
107.1
108.4
106.0
104.9
83.5
142.1
107.9
110.5
118.2
107.0
108.3
106.7
103.7
94.1
122.3
101.4
112.9
106.6
115.3

2 Products
3
Final products
4
Consumer goods, total
5
Durable consumer goods
6
Automotive products
7
Autos and trucks
8
Autos, consumer
9
Trucks, consumer
10
Auto parts and allied g o o d s . .
11
Other
12
Appliances, A/C, and T V —
13
Carpeting and furniture
14
Miscellaneous home goods . .
15
Nondurable consumer goods
16
Foods and tobacco
17
Clothing
Chemical products
18
19
Paper products
20
Energy
21
Fuels
22
Residential utilities

60.8
46.0
26.0
5.6
2.5
1.5
.9
.6
1.0
3.1
.8
.9
1.4
20.4
9.1
2.6
3.5
2.5
2.7
.7
2.0

105.6
108.2
105.2
102.5
99.4
96.9
79.0
127.9
103.7
105.2
110.4
99.9
105.6
105.9
104.7
95.0
118.7
100.8
108.3
104.7
109.6

104.8
107.1
104.0
102.0
99.0
96.5
83.5
119.2
103.2
104.6
109.6
98.0
106.0
104.6
103.3
94.5
117.6
100.6
105.2
103.8
105.8

23
24
25
26
27
28
29
30
31
32
33

Equipment
Business equipment
Information processing and related .
Office and computing
Industrial
Transit
Autos and trucks
Other
Defense and space equipment
Oil and gas well drilling
Manufactured homes

20.0
13.9
5.6
1.9
4.0
2.5
1.2
1.9
5.4
.6
.2

112.7
123.2
134.7
168.3
108.5
137.1
117.9
104.7
85.9
78.3
99.7

111.6
121.9
134.3
167.3
108.7
133.9
117.2
99.2
86.5
73.1
90.1

112.7
123.7
137.4
171.8
109.1
135.3
114.2
100.2
85.1
73.8
101.3

114.3
126.1
138.5
173.7
109.2
143.3
117.3
105.6
84.5
75.6
96.9

113.5
125.0
138.2
178.3
109.6
134.5
114.7
107.3
84.4
76.3
100.9

115.4
127.5
142.2
183.1
110.1
137.4
121.7
108.8
83.5
82.7
110.4

116.7
129.0
142.9
184.5
112.0
140.4
123.9
110.7
83.2
86.4
118.5

117.2
129.6
143.2
186.4
112.3
144.1
131.4
109.2
82.5
91.2
128.6

118.1
131.2
144.4
192.0
113.1
146.7
136.7
112.6
82.0
89.0
129.4

118.0
131.7
146.1
198.0
112.2
146.5
136.8
113.4
81.5
77.9
127.1

118.7
133.4
149.1
203.3
113.7
145.0
135.8
114.9
80.7
71.1
116.2

119.4
134.4
150.4
209.1
114.6
144.2
136.2
117.3
80.5
72.4
114.9

119.5
134.7
152.4
214.9
114.7
141.2
133.1
116.4
79.8
75.1
112.1

119.6
134.9
153.9
220.3
114.6
136.9
127.3
117.9
78.8
82.4
112.3

34
35
36

Intermediate products, total
Construction supplies
Business supplies

14.7
6.0
8.7

97.6
93.8
8.3

97.7
93.6
100.6

98.6
94.3
101.4

97.0
94.1
99.0

96.9
93.0
99.5

97.8
94.7
99.9

98.1
95.1
100.0

98.3
94.5
100.8

98.2
94.8
100.5

99.3
97.5
100.5

99.6
96.4
101.8

99.6
95.9
102.0

99.6
96.9
101.4

99.5
96.3
101.6

37 Materials
38
Durable goods materials
39
Durable consumer parts
40
Equipment parts
41
Other
42
Basic metal materials
43
Nondurable goods materials
44
Textile materials
45
Pulp and paper materials
46
Chemical materials
47
Other
48
Energy materials
49
Primary energy
50
Converted fuel materials

39.2
19.4
4.2
7.3
7.9
2.8
9.0
1.2
1.9
3.8
2.1
10.9
7.2
3.7

107.9
108.9
3.9
116.5
106.0
108.3
110.9
102.8
109.9
114.2
110.4
103.4
99.7
110.6

107.8
108.7
101.5
116.6
105.4
107.8
111.5
101.8
110.8
114.8
111.6
103.1
99.6
109.9

108.5
109.3
100.6
117.7
106.3
108.7
111.5
107.7
110.3
114.1
110.0
104.4
100.4
112.3

107.6
108.9
101.4
117.1
105.5
107.7
110.7
101.6
108.7
114.5
110.5
102.5
99.4
108.7

107.4
107.6
98.5
116.2
104.6
105.8
111.7
103.3
112.3
114.5
110.5
103.6
99.6
111.4

108.1
109.7
101.8
118.3
106.2
108.3
110.7
102.7
109.1
114.4
109.7
103.0
99.4
110.0

109.3

104.3
119.3
107.4
109.8
112.0
103.4
110.2
115.6
112.0
103.9
100.2
111.I

110.0
111.9
107.5
119.7
107.5
108.8
111.5
102.9
110.7
114.6
111.3
105.1
101.3
112.4

110.4
113.3
110.8
120.4
108.6
110.4
112.4
104.2
110.7
114.9
114.1
103.4
100.4
109.1

110.9
114.2
111.8
121.0
109.7
113.2
112.1
103.2
111.9
114.6
112.5
103.8
98.3
114.6

110.9
114.1
112.2
121.3
108.9
109.9
112.8
104.2
112.8
115.6
112.6
103.5
97.4
115.4

111.6
114.8
113.0
122.3
109.4
110.3
113.8
103.0
115.4
116.0
114.4
103.8
99.9
111.5

111.6
115.0
113.0
123.0
109.3

111.0

111.6
114.9
113.0
123.3
108.9
110.6
113.9
101.6
114.0
118.1
112.7
103.5
99.0
112.2

97.3
95.3

106.6
106.6

106.1
106.1

107.0
107.0

106.7
106.7

106.3
106.4

107.4
107.5

108.4
108.4

108.6
108.6

108.9
108.7

109.5
109.3

109.7
109.6

110.0
109.8

110.1
109.9

110.0
109.8

97.5

105.0

104.6

105.3

105.0

104.5

105.7

106.6

107.1

107.3

107.8

107.8

108.0

107.8

107.4

24.5
23.3

105.7
104.8

104.6
103.9

105.5
104.7

105.7
105.0

105.1
104.3

106.8
105.9

107.4
106.6

107.3
106.8

107.0
107.4

108.1
107.7

108.2
107.7

107.9
107.9

107.7
107.3

107.2
106.4

12.7

123.7

122.3

124.5

126.9

125.9

128.0

129.5

129.5

130.7

131.3

133.2

134.2

134.8

135.5

120.6
113.6

121.6
113.7

121.8
114.5

121.2
114.6

120.5
114.6

111.0

111.1

111.0

111.1

111.1

113.7
102.1
114.7
117.3
112.7
103.6
99.9

SPECIAL AGGREGATES

51 Total excluding autos and trucks
52 Total excluding motor vehicles and p a r t s . .
53 Total excluding office and computing
machines
54 Consumer goods excluding autos and
trucks
55 Consumer goods excluding energy
56 Business equipment excluding autos and
trucks
57 Business equipment excluding office and
computing equipment
58 Materials excluding energy




12.0
28.4

115.7
109.5

114.3
109.5

115.6
110.0

118.1
109.4

116.1
108.8

118.1
110.0

119.7
111.4

120.1
111.8

121.0
113.0

A48

Domestic Nonfinancial Statistics • September 1993

2.13 INDUSTRIAL PRODUCTION

r ro p

SIC
code 2

1987
proportion

Indexes and Gross Value1—Continued
1992

1993

1992
avg.
June

July

Aug.

Sept.

Oct.

Nov.

Dec.

Jan.

Feb.

Mar. r

Apr/

May r

June p

Index (1987 = 100)
MAJOR INDUSTRIES

59 Total index

100.0

106.5

106.0

106.8

106.6

106.2

107.5

108.4

108.9

109.3

109.9

110.1

110.4

110.3

110.1

60 Manufacturing
61
Primary processing
62
Advanced processing

84.3
27.1
57.1

106.9
103.8
108.3

106.5
103.7
107.9

107.1
104.3
108.4

107.0
103.5
108.7

106.8
103.3
108.4

108.0
104.1
109.9

108.9
105.1
110.7

109.2
105.0
111.3

109.9
105.8
111.9

110.5
106.9
112.2

110.8
106.4
112.9

111.3
106.9
113.4

111.2
106.9
113.2

110.8
106.7
112.8

63
64
65
66

Durable goods
Lumber and p r o d u c t s . . .
"24
Furniture and fixtures...
25
Clay, glass, and stone
products
32
Primary metals
33
Iron and steel
331,2
Raw steel
Nonferrous
333-6,9
Fabricated metal
products
34
Industrial and commercial
machinery and
computer equipment .
35
Office and computing
machines
357
Electrical machinery
36
Transportation
equipment
37
Motor vehicles and
parts
371
Autos and light
trucks
Aerospace and miscellaneous transportation equipment... 3 7 2 - 6,9
Instruments
38
Miscellaneous
39

46.5
2.1
1.5

108.1
96.4
99.0

107.6
93.8
94.2

108.2
96.6
97.5

108.5
96.6
99.2

108.1
94.7
100.5

109.8
97.8
100.4

110.9
99.8
102.3

111.8
98.0
103.9

112.9
99.3
105.2

113.8
101.8
106.0

114.1
98.0
107.3

114.8
97.4
108.1

114.7
97.9
107.8

114.3
95.8
108.3

2.4
3.3
1.9
.1
1.4

96.0
101.1
104.7
101.2
96.1

95.6
101.2
103.8
101.6
97.5

96.8
100.6
104.7
101.7
95.0

95.7
100.5
103.8
99.1
96.1

96.5
98.0
102.0
98.9
92.4

96.8
100.5
104.1
99.8
95.6

97.6
101.6
103.6
102.8
98.7

98.0
102.4
107.4
104.6
95.7

97.0
102.8
107.0
103.4
97.1

98.9
108.0
112.9
105.9
101.4

98.6
104.2
107.6
102.0
99.4

99.8
104.3
108.4
102.6
98.6

98.8
104.1
108.2
105.1
98.5

98.8
104.1
108.4

5.4

96.7

97.1

97.0

97.0

96.5

97.5

97.6

97.8

99.8

99.7

100.3

101.0

100.2

100.3

8.5

124.8

123.8

125.7

126.9

127.9

130.6

132.8

133.8

135.0

136.7

139.6

142.5

143.9

145.0

2.3
6.9

168.3
119.8

167.3
119.3

171.8
120.7

173.7
120.6

178.3
121.5

183.1
122.6

184.5
124.4

186.4
124.8

192.0
125.8

198.0
127.1

203.3
128.5

209.1
128.6

214.9
129.4

220.3
129.2

9.9

102.6

102.7

101.4

102.4

100.5

103.0

103.6

106.3

108.4

107.8

106.9

107.0

105.6

103.6

4.8

104.8

104.8

103.1

105.0

102.6

108.0

109.9

116.2

120.9

120.7

120.1

120.9

119.0

116.0

2.2

101.4

102.7

100.8

99.7

97.9

104.1

105.4

114.4

118.2

117.8

116.9

117.5

113.1

108.1

5.1
5.1
1.3

100.6
104.2
109.7

100.8
104.4
109.7

99.8
104.9
111.6

100.0
104.3
109.1

98.6
103.7
108.7

98.3
103.7
110.5

97.7
103.6
111.4

97.1
103.3
111.8

96.7
103.0
110.9

95.8
102.2
111.9

94.6
103.3
112.6

93.9
102.5
114.5

93.2
102.3
113.8

91.9
101.6
112.8

Nondurable goods
Foods
Tobacco products
Textile mill p r o d u c t s . . . .
Apparel products
Paper and products
Printing and publishing..
Chemicals and products.
Petroleum products
Rubber and plastic
products
Leather and products . . .

"20
21
22
23
26
27
28
29

37.8
8.8
1.0
1.8
2.3
3.6
6.5
8.8
1.3

105.4
106.0
99.2
104.7
92.3
108.2
95.0
115.0
102.0

105.2
105.4
96.4
103.8
91.7
108.7
95.6
114.9
101.8

105.7
105.9
101.5
107.0
92.7
109.1
95.7
114.6
101.5

105.2
106.3
115.5
103.5
91.3
107.1
93.5
114.4
98.0

105.2
105.6
101.7
105.1
91.5
109.5
94.1
115.2
101.1

105.8
106.8
102.4
103.5
91.7
107.3
94.5
116.2
105.3

106.4
106.4
101.9
106.0
92.9
108.2
94.2
117.7
103.9

106.0
106.2
96.1
106.0
92.7
108.3
94.7
116.7
103.4

106.4
105.9
100.5
106.9
93.1
108.6
94.7
116.8
103.2

106.4
106.9
99.3
106.2
92.5
110.4
94.0
116.2
104.7

106.6
106.7
92.4
105.4
92.1
111.1
94.7
117.6
104.7

107.0
106.8
96.2
104.3
92.0
113.2
94.9
117.7
104.3

106.9
106.1
98.1
105.4
91.6
112.8
94.5
118.1
105.7

106.6
105.3
98.0
104.7
91.0
112.3
94.8
118.4
104.7

30
31

3.2
.3

109.7
92.6

109.7
92.3

110.7
93.6

110.7
92.0

108.5
93.8

109.9
95.1

111.3
96.6

111.3
96.7

113.6
97.1

112.7
99.0

112.9
99.1

113.4
100.2

112.9
98.0

112.2
96.2

"lO
11,12
13
14

8.0
.3
1.2
5.8
.7

97.6
161.7
105.5
92.6
93.8

97.1
157.8
101.9
93.1
92.7

98.5
156.5
108.0
93.6
94.1

97.0
165.5
103.9
91.9
93.8

97.1
159.8
103.6
92.7
91.9

97.6
168.1
103.8
92.7
93.6

97.8
171.6
103.5
92.8
94.4

98.2
158.1
107.9
93.4
92.6

98.3
167.7
108.2
92.7
93.8

95.9
163.0
101.7
90.9
95.2

95.3
158.2
102.3
90.4
93.4

96.4
163.2
108.2
90.5
92.4

96.9
170.7
103.8
91.5
94.3

96.3
167.6
99.5
91.8
93.6

7.7
6.1
1.6

112.0
111.6
113.2

110.0
109.5
112.0

111.2
110.8
112.8

110.4
110.0
112.1

111.2
110.9
112.0

112.7
112.6
113.2

114.7
114.1
117.3

116.8
116.4
118.2

112.8
112.9
112.4

117.5
116.5
121.4

117.8
116.3
123.3

115.0
114.5
116.7

114.9
114.6
116.2

116.4
116.3
116.9

79.5

107.0

106.6

107.4

107.2

107.1

108.0

108.8

108.8

109.3

109.8

110.2

110.7

110.7

110.5

81.9

105.1

104.8

105.3

105.1

104.8

105.9

106.7

107.0

107.6

108.0

108.1

108.5

108.2

107.7

67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91

92 Mining
93
Metal
94
Coal
95
Oil and gas extraction
96
Stone and earth minerals . .
97 Utilities
98
Electric
99
Gas

49I,3PT

492,3PT

98!2

SPECIAL AGGREGATES

100 Manufacturing excluding
motor vehicles and
parts
101 Manufacturing excluding
office and computing
machines

Gross value (billions of 1987 dollars, annual rates)
MAJOR M A R K E T S

102 Products, total

1,707.0 1,806.4 1,794.6 1,806.8 1,802.7 1,799.9 1,835.6 1,846.7 1,857.5 1,864.9 1,880.2 1,880.3 1,881.5 1,878.0 1,868.4

103 Final
104 Consumer goods
105 Equipment
106 Intermediate

1,314.6 1,420.1 1,408.8 1,416.7 1,417.8 1,415.7 1,448.1 1,457.1 1,466.8 1,476.4 1,485.7 1,484.3 1,486.0 1,482.8 1,473.2
866.6 913.0
906.6
912.6
908.1
905.1
928.4
931.6
936.3
940.0
949.4
946.1
945.1
934.5
942.8
448.0
507.1
502.2
504.1
509.7
510.6
519.7
525.5
530.5
536.5
536.3
538.2
540.8
540.0
538.7
392.5
386.4
385.9
385.0
390.1
384.2
387.4
389.6
390.7
388.4
394.5
395.5
396.0
395.2
395.2

1. Data in this table also appear in the Board's G.17 (419) monthly statistical
release. For ordering address, see inside front cover.
A revision of the industrial production index and the capacity utilization rates




was released in May 1993. See "Industrial Production, Capacity, and Capacity
Utilization since 1987," Federal Reserve Bulletin, vol. 79 (June 1993), pp. 590-605.
2. Standard industrial classification.

Selected Measures
2.14

A49

HOUSING A N D CONSTRUCTION
Monthly figures at seasonally adjusted annual rates except as noted
1993

1992
1990

Item

1991

1992
Aug.

Sept.

Oct.

Nov.

Dec.

Jan.

Feb.

Mar. r

Apr. r

May

Private residential real estate activity (thousands of units except as noted)

N E W UNITS

Permits authorized
One-family
Two-or-more-family
Started
One-family
Two-or-more-family
Under construction at end of period
One-family
Two-or-more-family
Completed
One-family
Two-or-more-family
Mobile homes shipped

1,111
794
317
1,193
895
298
711
449
262
1,308
966
342
188

949
754
195
1,014
840
174
606
434
173
1,091
838
253
171

1,095
911
184
1,200
1,030
169
612
473
140
1,158
964
194
210

1,081
885
196
1,229
1,038
191
633
479
154
1,133
945
188
202

1,120
918
202
1,218
1,045
173
637
485
152
1,128
942
186
217

1,141
954
187
1,226
1,079
147
645
493
152
1,137
964
173
228

1,136
963
173
1,226
1,089
137
641
498
143
1,229
1,002
227
244

1,196
1,037
159
1,286
1,133
153
644
501
143
1,227
1,016
211
266

1,157
972
185
1,171
1,051
120
641
506
135
1,136
980
156
267

1,141
957
184
1,180
1,036
144
641
508
133
1,241
1,049
192
262

1,034
871
163
1,124
987
137
635
502
133
1,108
995
113
247

1,101
925
176
1,206
1,059
147
639
507
132
1,198
1,070
128
241

1,121
919
202
1,254
1,110
144
647
513
134
1,125
986
139
230

Merchant builder activity in
one-family units
14 Number sold
15 Number for sale at end of period 1 .

535
321

507
284

610
265

625
270

672
267

637
264

615
262

662
265

603
266

597 r
268

595
271

723
271

571
278

122.3
149.0

120.0
147.0

121.3
144.9

123.5
145.3

119.5
142.2

125.0
148.4

128.9
147.2

126.0
146.2

118.0
138.9

129.4r
149.4r

125.0
147.0

126.9
147.1

128.4
153.4

3,211

3,219

3,520

3,340

3,380

3,710

3,860

4,040

3,780

3,460

3,370

3,450

3,620

95.2
118.3

99.7
127.4

103.6
130.8

105.0
132.4

103.5
131.0

103.4
129.3

102.7
128.8

104.2
131.0

103.1
129.4

103.6
129.6

105.1
131.5

105.8
133.0

106.1
132.4

1
2
3
4
5
6
7
8
9
10
11
12
13

Price of units sold
of dollars)
16 Median
17 Average

(thousands

EXISTING UNITS ( o n e - f a m i l y )

18 Number sold
Price of units said
of dollars)
19 Median
20 Average

(thousands

Value of new construction (millions of dollars) 3

CONSTRUCTION
436,043R

453,820"

454,465

451,447

453,473

336,972
205,519
131,453
22,152
41,323
21,484
46,494

331,260
200,466
130,794
19,519
42,121
22,531
46,623

334,792
200,771
134,021
20,087
42,107
23,322
48,505

r
107,461r 109,900" 118,784 r 118,084" 116,097" 117,723" 121,073" 119,885" 115,786" 119,019"
Public
2,621"
2,703"
2,557"
2,394"
2,503"
3,032"
2,502
2,504"
1,837
2,664
Military
r
34,929" 35,546" 35,545" 33,408" 37,698" 33,411" 30,648" 33,009"
32,108" 32,026
Highway
5,732"
6,688"
6,441"
8,144"
6,148"
5,790"
5,918 r
5,497"
4,861 r
4,557 r
Conservation and d e v e l o p m e n t . . .
r
75,435" 74,537" 71,901" 75,493" 74,377" 75,936" 76,785" 76,619"
68,132 r 71,176
Other

117,493
2,586
33,413
7,112
74,382

120,187
2,416
34,012
5,916
77,843

118,681

22 Private
23
Residential
24
Nonresidential
25
Industrial buildings
26
Commercial buildings
27
Other buildings
28
Public utilities and other
29
30
31
32
33

403,439R

r
r
334,681 r 293,536 317,256 r 312,266" 317,448" 324,842" 328,196" 335,354" 335,484" 334,801"
182,856 157,837 187,820 r 187,297" 189,221" 194,578" 199,304" 206,417" 207,214" 205,730"
151,825 r 135,699" 129,436r 124,969" 128,227" 130,264" 128,892" 128,937" 128,270" 129,071"
20,720
18,899" 19,277" 19,400" 19,246" 19,961" 19,600" 20,484"
22,281
23,849
41,523 r 39,126" 40,398" 41,691" 41,143" 39,602" 41,414" 42,317"
48,482
62,866
r
21,494
21,139" 21,978" 21,418" 21,517" 20,900" 21,123" 21,564"
20,797
21,591
44,139" 45,699" 45,805" 46,574" 47,755" 46,986" 48,474" 46,133" 44,706"

21 Total put in place

442,142R

430,350"

442,565"

449,269"

455,239"

451,271"

43,5^

1. Not at annual rates.
2. Not seasonally adjusted.
3. Recent data on value of new construction may not be strictly comparable
with data for previous periods because of changes by the Census Bureau in its
estimating techniques. For a description of these changes, see Construction
Reports (C-30-76-5), issued by the Census Bureau in July 1976.
SOURCE. Census Bureau estimates for all series except (1) mobile homes, which
are private, domestic shipments as reported by the Manufactured Housing




433,545"

2,320
31,983
5,974
78,404

Institute and seasonally adjusted by the Census Bureau, and (2) sales and prices
of existing units, which are published by the National Association of Realtors. All
back and current figures are available from the originating agency. Permit
authorizations are those reported to the Census Bureau from 17,000 jurisdictions
beginning in 1984.

A50
2.15

Domestic Nonfinancial Statistics • September 1993
C O N S U M E R A N D P R O D U C E R PRICES
Percentage changes based on seasonally adjusted data except as noted
Change from 12
months earlier

Change from 3 months earlier
(annual rate)

Item

Index
level,
June
1993 1

19931

1993

1992
1992
June

Change from 1 month earlier

1993
June
Sept.

Dec.

Mar.

June

Feb.

Mar.

Apr.

May

June

CONSUMER PRICES2

(1982-84=100)
1 All items

3.1

3.0

2.6

3.2

4.0

2.2

.3

.1

.4

.1

.0

144.4

2
3 Energy items
4 All items less food and energy
5
Commodities
6
Services

.1
2.3
3.8
3.0
4.2

2.2
.6
3.3
2.0
4.0

3.2
1.2
2.5
1.8
2.9

1.4
1.9
3.8
1.5
4.7

2.6
3.1
4.3
4.6
4.4

1.4
-3.8
2.9
.6
4.1

.1
-.4
.5
.5
.4

.1
.1
.1
.2

.4
.2
.4
.3
.4

.4
-1.0
.2
.0
.3

-.4
-.2
.1
-.1
.2

140.4
106.5
151.8
134.9
161.5

1.4
1.9

-.3
3.3
-10.2
1.2
.6

3.9
-2.2
17.2
2.9
3.4

1.0
1.9
-4.0
1.4
2.2

,4 r
.ff
1.7
.3
.3 r

.2 r
.OF
1.3
.1
.<f

.6
1.4
.1
.4
.2

.0
-.1
-.6
.2
.2

-.3
-.9
-.5
-.3
.2

125.6
125.4
80.4
139.7
131.2

.7

.6
.5 r

.3
.2

.1
.2

-.2
-.2

.3
.1

117.0
123.6

-,2r
,4 r
.y

2.5
-.6
1.8

.5
4.8
.4

-3.1
.2
.2

107.3
81.2
141.5

.7

PRODUCER PRICES

(1982=100)
1.6
-1.8
3.3
3.0
1.9

-.7

1.7
1.8

1.3
4.3
-3.5
1.5
1.2

Intermediate
materials
12 Excluding foods and feeds
Excluding energy
13

1.0
.5

1.2
1.3

-2.1
-.3

5.3
4.3

.7

1.3

Crude materials
14 Foods
15 Energy
16 Other

.0
3.9
1.9

-.1
1.4
9.5

-4.8
19.8
2.2

5.1
-17.8
1.9

1.1
-9.7
25.0

-.8
18.7
10.2

7

8
9
10
11

Finished goods
Consumer foods
Consumer energy
Other consumer goods
Capital equipment

1. Not seasonally adjusted.
2. Figures for consumer prices are for all urban consumers and reflect a
rental-equivalence measure of homeownership.




.0

.(f
— 1.4r
2.0 r

SOURCE. Bureau of Labor Statistics.

Selected Measures
2.16

A51

GROSS DOMESTIC PRODUCT A N D INCOME
Billions of current dollars except as noted; quarterly data at seasonally adjusted annual rates
1993

1992
Account

1990

1991

1992
Ql

Q2

Q3

Q4

Ql

GROSS DOMESTIC PRODUCT

1 Total

5,522.2

5,677.5

5,950.7

5,840.2

5,902.2

5,978.5

6,081.8

6,145.8

By source
2 Personal consumption expenditures
3
Durable goods
4
Nondurable goods
5
Services

3.748.4
464.3
1.224.5
2,059.7

3,887.7
446.1
1,251.5
2,190.1

4,095.8
480.4
1,290.7
2,324.7

4,022.8
469.4
1,274.1
2,279.3

4,057.1
470.6
1,277.5
2,309.0

4.108.7
482.5
1.292.8
2,333.3

4,194.8
499.1
1,318.6
2,377.1

4.234.7
498.8
1.320.8
2,415.1

799.5
793.2
577.6
201.1
376.5
215.6

721.1
731.3
541.1
180.1
360.9
190.3

770.4
766.0
548.2
168.4
379.9
217.7

722.4
738.2
531.0
170.1
360.8
207.2

773.2
765.1
550.3
170.3
380.0
214.8

781.6
766.6
549.6
166.1
383.5
217.0

804.3
794.0
562.1
167.0
395.1
231.9

844.0
809.0
573.8
168.0
405.8
235.2

6.3
3.3

-10.2
-10.3

4.4
2.2

-15.8
-13.3

8.1
6.4

15.0
9.7

10.3
6.2

34.9
32.6

-68.9
557.0
625.9

-21.8
598.2
620.0

-30.4
636.3
666.7

-8.1
628.1
636.2

-37.1
625.4
662.5

-36.0
639.0
675.0

-40.5
652.7
693.2

-49.4
649.4
698.9

17 Government purchases of goods and services . .
18
Federal
19
State and local

1,043.2
426.4
616.8

1,090.5
447.3
643.2

1,114.9
449.1
665.8

1,103.1
445.0
658.0

1,109.1
444.8
664.3

1,124.2
455.2
669.0

1,123.3
451.6
671.7

1,116.6
441.1
675.4

By major type of product
20 Final sales, total
21
Goods
22
Durable
23
Nondurable
24
Services
25
Structures

5,515.9
2,160.1
920.6
1,239.5
2,846.4
509.4

5.687.7
2.192.8
907.6
1,285.1
3,030.3
464.7

5,946.3
2.260.3
943.9
1.316.4
3,197.1
488.8

5,855.9
2,233.6
923.6
1,310.0
3,142.2
480.1

5.894.1
2.233.2
932.3
1,300.8
3,173.4
487.6

5.963.5
2,258.4
943.8
1.314.6
3,217.8
487.3

6,071.5
2,316.1
975.8
1,340.3
3,255.1
500.3

6,110.8
2,309.2
968.8
1,340.4
3,299.4
502.3

6.3
-.9
7.2

-10.2
-19.3
9.0

4.4
-3.5
7.9

-15.8
-19.3
3.5

8.1
9.5
-1.4

15.0
2.7
12.3

10.3
-6.9
17.2

34.9
17.8
17.2

4,877.5

4,821.0

4,922.6

4,873.7

4,892.4

4,933.7

4,990.8

4,999.9

4,468.3

4,544.2

4,743.4

4,679.4

4,716.5

4,719.6

4,858.0

4,914.2 r

3,583.7
2,963.9
569.6
2,394.3
619.8
307.6
312.2

3,628.4
2,999.8
578.2
2,421.6
628.6
312.0
316.5

428.4
380.4
48.1

441.9
389.0
52.9

6 Gross private domestic investment
7
Fixed investment
8
Nonresidential
9
Structures
10
Producers' durable equipment
11
Residential structures
12
13

Change in business inventories
Nonfarm

14 Net exports of goods and services
15
Exports
Imports
16

26 Change in business inventories
27
Durable goods
28
Nondurable goods
MEMO

29 Total GDP in 1987 dollars
NATIONAL INCOME

30 Total

3,291.2
2,742.9
514.8
2,228.0
548.4
277.4
271.0

3,390.8
2,812.2
543.5
2,268.7
578.7
290.4
288.3

3,525.2
2,916.6
562.5
2,354.1
608.6
302.9
305.7

3,476.3
2,877.6
554.6
2,323.0
598.7
299.4
299.2

3,506.3
2,901.3
561.4
2,339.9
605.0
301.5
303.6

3,534.3
2,923.5
564.3
2,359.1
610.8
302.9
307.9

38 Proprietors'income 1
.
39
Business and professional
40
Farm 1

366.9
325.2
41.7

368.0
332.2
35.8

404.5
364.9
39.5

393.6
353.6
40.1

398.4
359.9
38.5

397.4
365.9
31.5

41 Rental income of persons 2

-12.3

-10.4

4.7

-4.5

3.3

6.4

13.6

374.1
354.1
-9.7
29.7

428.5
389.4
1.0
38.1

424.2 r
393.0"
-9.4
40.6

407.3

403.6

402.0

31 Compensation of employees
32
Wages and salaries
33
Government and government enterprises . .
34
Other
35
Supplement to wages and salaries
36
Employer contributions for social insurance
37
Other labor income

42 Corporate profits . .
43
Profits before tax 3
44
Inventory valuation adjustment
45
Capital consumption adjustment

361.7
355.4
-14.2
20.5

346.3
334.7
3.1
8.4

393.8
371.6
-7.4
29.5

384.0
366.1
-5.4
23.3

388.4
376.8
-15.5
27.0

46 Net interest

460.7

449.5

415.2

430.0

420.0

1

1. With inventory valuation and capital consumption adjustments.
2. With capital consumption adjustment.




3. For after-tax profits, dividends, and the like, see table 1.48.
SOURCE. U.S. Department of Commerce, Survey of Current Business.

17.7

A52
2.17

Domestic Nonfinancial Statistics • September 1993
PERSONAL INCOME A N D SAVING
Billions of current dollars except as noted; quarterly data at seasonally adjusted annual rates
1993

1992
1990

1991

1992
Ql

Q2

Q3

Q4

Ql

PERSONAL INCOME AND SAVING

1 Total personal income

4,664.2

4,828.3

5,058.1

4,980.5

5,028.9

5,062.0

5,160.9

5,237.6

2 Wage and salary disbursements
3
Commodity-producing industries
4
Manufacturing
5
Distributive industries
6
Service industries
7
Government and government enterprises

2,742.8
745.6
556.1
634.6
847.8
514.8

2,812.2
737.4
556.9
647.4
883.9
543.6

2,918.1
743.2
565.7
666.8
945.5
562.5

2,877.6
736.8
559.9
660.9
925.3
554.6

2,901.3
743.1
564.7
662.9
933.9
561.4

2,923.5
742.4
565.5
667.7
949.1
564.3

2,969.9
750.6
572.8
675.8
973.9
569.6

3,005.8
754.4
576.5
685.0
988.2
578.2

271.0
366.9
325.2
41.7
-12.3
140.3
694.5
685.8
352.0

288.3
368.0
332.2
35.8
-10.4
137.0
700.6
771.1
382.0

305.7
404.5
364.9
39.5
4.7
139.3
670.2
866.1
414.1

299.2
393.6
353.6
40.1
-4.5
133.9
684.8
842.7
405.7

303.6
398.4
359.9
38.5
3.3
136.6
675.2
859.7
412.1

307.9
397.4
365.9
31.5
6.4
141.0
663.2
874.1
417.1

312.2
428.4
380.4
48.1
13.6
145.8
657.8
888.0
421.6

316.5
441.9
389.0
52.9
17.7
149.9
656.4
909.9
434.1

8
9
10
11
12
13
14
15
16
17

Other labor income
Proprietors' income
Business and professional
Farm'
Rental income of persons
Dividends
Personal interest income
Transfer payments
Old-age survivors, disability, and health insurance benefits . . .
LESS: Personal contributions for social insurance

18 EQUALS: Personal income

224.8

238.4

250.6

246.8

249.3

251.5

254.8

260.4

4,664.2

4,828.3

5,058.1

4,980.5

5,028.9

5,062.0

5,160.9

5,237.6

621.3

618.7

627.3

619.6

617.1

628.8

643.6

656.0

20 EQUALS: Disposable personal income

4,042.9

4,209.6

4,430.8

4,360.9

4,411.8

4,433.2

4,517.3

4,581.7

21

LESS: Personal outlays

3,867.3

4,009.9

4,218.1

4,146.3

4,179.5

4,229.9

4,316.9

4,358.8

22 EQUALS: Personal saving

175.6

199.6

212.6

214.6

232.3

203.3

200.4

222.9

19,513.0
13,043.6
14,068.0

19,077.1
12,824.1
13,886.0

19,271.4
12,973.9
14,035.0

19,158.5
12,930.2
14,017.0

19,181.8
12,893.3
14,021.0

19,288.4
12,973.3
13,998.0

19.456.3
13.098.4
14,105.0

19,444.3
13,092.1
14,165.0

4.3

4.7

4.8

4.9

5.3

4.6

4.4

4.9

19

LESS: Personal tax and nontax payments

MEMO

Per capita (1987 dollars)
23 Gross domestic product
24 Personal consumption expenditures
25 Disposable personal income
26 Saving rate (percent)
GROSS SAVING

27 Gross saving

718.0

708.2

686.3

677.5

682.9

696.9

687.9

732.8R

28 Gross private saving

854.1

901.5

968.8

950.1

968.1

992.1

965.0

994.8 r

29 Personal saving
30 Undistributed corporate profits
31 Corporate inventory valuation adjustment

175.6
75.7
-14.2

199.6
75.8
3.1

212.6
104.3
-7.4

214.6
104.0
-5.4

232.3
97.7
-15.5

203.3
91.2
-9.7

200.4
124.1
1.0

222.9
116.8r
-9.4

Capital consumption
32 Corporate
33 Noncorporate

368.3
234.6

383.0
243.1

394.8
258.6

386.1
245.3

391.2
247.0

407.2
290.4

394.7
251.8

400.0
261.2

-136.1
-166.2
30.1

-193.3
-210.4
17.1

-282.5
-298.0
15.5

-272.6
-289.2
16.6

-285.2
-302.9
17.7

-295.2
-304.4
9.2

-277.2
-295.5
18.3

-262.0
-272.1
10.1

723.4

730.1

720.4

706.5

713.8

732.0

729.5

776.3R

799.5
-76.1

721.1
9.0

770.4
-49.9

722.4
-16.0

773.2
-59.4

781.6
-49.6

804.3
-74.7

844.0
—67.7r

5.4

21.9

34.1

29.0

30.9

35.1

41.7

allowances

34 Government surplus, or deficit ( - ) , national income and
product accounts
Federal
35
36
State and local
37 Gross investment
38 Gross private domestic
39 Net foreign
40 Statistical discrepancy
1. With inventory valuation and capital consumption adjustments.
2. With capital consumption adjustment.




SOURCE. U.S. Department of Commerce, Survey of Current

Business.

43.4

Summary Statistics
3.10

U.S. INTERNATIONAL TRANSACTIONS

A53

Summary

Millions of dollars; quarterly data seasonally adjusted except as noted1
1993
1990

1 Balance on current account
2
Merchandise trade balance 2
3
Merchandise exports
4
Merchandise imports
5
Military transactions, net
6
Other service transactions, net
7
Investment income, net
8
U.S. government grants
9
U.S. government pensions and other transfers
10
Private remittances and other transfers
11 Change in U.S. government assets other than official
reserve assets, net (increase, - )
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

1992

1991

Ql

Q2

Q3

Q4

Qlp
-22,249
-29,068
111,627
-140,695
-383
15,006
273
-3,412
-971
-3,694

-91,861
-109,033
389,303
-498,336
-7,834
38,485
20,348
-17,434
-2,934
-13,459

-8,324
-73,802
416,937
-490,739
-5,851
51,733
13,021
24,073
-3,461
-14,037

-66,400
-96,138
440,138
-536,276
-2,751
59,163
6,222
-14,688
-3,735
-14,473

-6,685
-17,763
108,347
-126,110
-571
14,619
4,419
-2,788
-830
-3,770

-18,253
-24,801
108,306
-133,107
-727
14,378
907
-3,234
-1,118
-3,659

-17,775
-27,612
109,493
-137,105
-617
15,898
1,703
-2,783
-940
-3,424

-23,687
-25,962
113,992
-139,954
-836
14,265
-806
-5,883
-846
-3,619

2,307

2,905

-1,609

-275

-293

-305

-737

309
-983

-2,158

5,763

3,901

-1,057

1,464

1,952

1,542

-192
731
-2,697

-177
-367
6,307

2,316
-2,692
4,277

-172
111
-9%

-168

-173

2,829
-2,685
1,398

-140

-2,639
33,921

0

0

0

0

0
1

1,631

0

-118

2,243

0

0

-228

-615

-44,280
16,027
-4,433
-28,765
-27,109

-68,643
3,278
1,932
-44,740
-29,113

-53,253
24,948
4,551
-47,961
-34,791

303
17,795
5,339
-8,493
-14,338

-9,866
4,050
1,294
-8,276
-6,934

-12,445
6,584
-3,214
-13,787
-2,028

-31,243
-3,481
1,132
-17,405
-11,489

-26,578
-9,982

22 Change in foreign official assets in United States (increase, +) . .
23
U.S. Treasury securities
24
Other U.S. government obligations
25
Other U.S. government liabilities
26
Other U.S. liabilities reported by U.S. banks'
27
Other foreign official assets 5

34,198
29,576
667
2,156
3,385
-1,586

17,564
14,846
1,301
1,542
-1,484
1,359

40,684
18,454
3,949
2,542
16,427

21,124
14,916
464
58
5,573
113

21,008
11,240
1,699
678
7,466
-75

-7,378
-323
912
864
-7,831

-1,000

5,931
-7,379
874
943
11,219
274

10,990
1,039
710
-210
8,046
1,404

28 Change in foreign private assets in United States (increase, + ) . .
29
U.S. bank-reported liabilities 3
30
U.S. nonbank-reported liabilities
31
Foreign private purchases of U.S. Treasury securities, net
32
Foreign purchases of other U.S. securities, net
33
Foreign direct investments in United States, net

70,976
16,370
7,533
-2,534
1,592
48,015

65,875
-11,371
-699
18,826
35,144
23,975

88,895
18,609
741
36,893
30,274
2,378

-1,290
-3,339
926
623
4,613
-4,113

23,442
-528
979
10,168
10,453
2,370

33,828
23,647
1,553
4,870
2,730
1,028

32,914
-1,171
-2,717
21,232
12,478
3,092

8,600
-22,048

34 Allocation of special drawing rights
35 Discrepancy
36
Due to seasonal adjustment
37
Before seasonal adjustment

30,820

17 Change in U.S. private assets abroad (increase, - )
18
Bank-reported claims 3
19
Nonbank-reported claims
20
U.S. purchases of foreign securities, net
21
U.S. direct investments abroad, net

0

0

-15,140

0
-12,218
-12,218

30,820

0
-12,120
4,878
-16,998

0

-17,502
653
-18,155

0

2,123
-6,754
8,877

0
15,280
1,222
14,058

14,179
10,635
5,834

0
5,973
5,726
247

MEMO

Changes in official assets
38 U.S. official reserve assets (increase, - )
39 Foreign official assets in United States, excluding line 25
(increase, + )
40 Change in Organization of Petroleum Exporting Countries
official assets in United States (part of line 22)

-2,158

5,763

3,901

-1,057

1,464

1,952

1,542

-983

32,042

16,022

38,142

21,066

20,330

-8,242

4,988

11,199

5,857

2,583

-2,113

3,051

2,336

639

1,707

1. Seasonal factors not calculated for lines 12-16, 18-20, 22-34, and 38-40.
2. Data are on an international accounts basis. The data differ from the Census
basis data, shown in table 3.11, for reasons of coverage and timing. Military
exports are excluded from merchandise trade data and are included in line 6.
3. Reporting banks include all types of depository institution as well as some
brokers and dealers.




4. Associated primarily with military sales contracts and other transactions
arranged with or through foreign official agencies.
5. Consists of investments in U . S . corporate stocks and in debt securities of
private corporations and state and local governments.
SOURCE. U.S. Department of Commerce, Survey of Current Business.

A54

International Statistics • September 1993

3.11 U.S. FOREIGN TRADE1
Millions of dollars; monthly data seasonally adjusted
1992
Item

1 Exports of domestic and foreign
merchandise, excluding grant-aid
shipments
2 General imports including merchandise
for immediate consumption
plus entries into bonded
warehouses
3 Trade balance

1990

393,592

1991

421,730

1993

1992

448,164

Nov.

Dec.

Jan.

Feb.

Mar.

Apr. r

May?

37,7%

39,178

37,505

36,928

38,895

38,479

38,953

495,311

488,453

532,665

45,633

46,143

45,176

44,832

49,347

48,660

47,319

-101,718

-66,723

-84,501

-7,837

-6,965

-7,672

-7,904

-10,453

-10,182

-8,366

1. Government and nongovernment shipments of merchandise between foreign
countries and the fifty states, including the District of Columbia, Puerto Rico, the
U.S. Virgin Islands, and U.S. Foreign Trade Zones. Data exclude (1) shipments
among the United States, Puerto Rico, the U.S. Virgin Islands, and other U.S.
affiliated insular areas, (2) shipments to U.S. Armed Forces and diplomatic
missions abroad for their own use, (3) U.S. goods returned to the United States by
its Armed Forces, (4) personal and household effects of travelers, and (5)
in-transit shipments. Data reflect the total arrival of merchandise from foreign
countries that immediately entered consumption channels, warehouses, or U.S.
Foreign Trade Zones (general imports). Import data are Customs value; export
data are F.A.S. value. Since 1990, data for U.S. exports to Canada have been
derived from import data compiled by Canada; similarly, in Canadian statistics,
Canadian exports to the United States are derived from import data compiled by

the United States. Since Jan. 1, 1987, merchandise trade data have been released
forty-five days after the end of the month; the previous month is revised to reflect
late documents.
Data in this table differ from figures for merchandise trade shown in the U.S.
balance of payments accounts (table 3.10, lines 2 through 4) primarily for reasons
of coverage. For both exports and imports, a large part of the difference is the
treatment of military sales and purchases. The military sales to foreigners
(exports) and purchases from foreigners (imports) that are included in this table as
merchandise trade are shifted, in the balance of payments accounts, from
"merchandise trade" into the broader category "military transactions."
SOURCE. (U.S. Department of Commerce, Bureau of the Census), FT900, U.S.
Merchandise Trade.

3.12 U.S. RESERVE ASSETS
Millions of dollars, end of period
1992
Asset

1 Total
2 Gold stock, including Exchange
Stabilization Fund 1
3 Special drawing rights 2 ' 3
4 Reserve position in International
Monetary Fund
5 Foreign currencies 4

1989

1993

1991
Jan.

Feb.

Mar.

Apr.

May

74,609

83,316

77,719

71,323

71,962

72,847

74,378

75,644

76,711

11,059
9,951

11,058
10,989

11,057
11,240

11,056
8,503

11,055
8,546

11,055
8,651

11,054
8,787

11,054
8,947

11,053
9,147

9,048
44,551

9,076
52,193

9,488
45,934

11,759
40,005

12,079
40,282

12,021
41,120

12,184
42,353

12,317
43,326

12,195
44,316

1. Gold held "under e a r m a r k " at Federal Reserve Banks for foreign and
international accounts is not included in the gold stock of the United States; see
table 3.13, line 3. Gold stock is valued at $42.22 per fine troy ounce.
2. Special drawing rights (SDRs) are valued according to a technique adopted
by the International Monetary Fund (IMF) in July 1974. Values are based on a
weighted average of exchange rates for the currencies of member countries. From
July 1974 through December 1980, sixteen currencies were used; since January

June p

1981, five currencies have been used. U.S. SDR holdings and reserve positions in
the IMF also have been valued on this basis since July 1974.
3. Includes allocations of SDRs by the International Monetary Fund on Jan. 1
of the year indicated, as follows: 1970—$867 million; 1971—$717 million; 1972—
$710 million; 1979—$1,139 million; 1980—$1,152 million; 1981—$1,093 million;
plus net transactions in SDRs.
4. Valued at current market exchange rates.

3.13 FOREIGN OFFICIAL ASSETS HELD AT FEDERAL RESERVE BANKS 1
Millions of dollars, end of period
1992
Asset

1989

1990

Dec.
1 Deposits
Held in custody
2 U.S. Treasury securities
3 Earmarked gold 3

Jan.

Feb.

Mar.

Apr.

May

June p

589

369

%8

205

325

2%

317

221

193

286

224,911
13,456

278,499
13,387

281,107
13,303

314,481
13,686

324,356
13,077

329,183
13,074

326,486
12,989

339,3%
12,924

345,060
12,854

343,672
12,829

1. Excludes deposits and U.S. Treasury securities held for international and
regional organizations.
2. Marketable U.S. Treasury bills, notes, and bonds and nonmarketable U.S.
Treasury securities payable at face value in dollars or foreign currencies.




1993

1991

3. Held in foreign and international accounts and valued at $42.22 per fine troy
ounce; not included in the gold stock of the United States.

Summary Statistics
3.14 FOREIGN BRANCHES OF U.S. BANKS

A55

Balance Sheet Data1

Millions of dollars, end of period
1993

1992
1989

Account

1990

1991
Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

All foreign countries

ASSETS

...

545,366

556,925

548,999'

566,721

542,545

543,624

554,280

546,941

543,833

2 Claims on United States
3
Parent bank
4
Other banks in United States .
5
Nonbanks
6 Claims on foreigners
7
Other branches of parent bank
8
Banks
9
Public borrowers
10
Nonbank foreigners
11 Other assets

198,835
157,092
17,042
24,701
300,575
113,810
90,703
16,456
79,606
45,956

188,496
148,837
13,296
26,363
312,449
135,003
72,602
17,555
87,289
55,980

176,487r
137,695r
12,884
25,908
303,934
111,729
81,970
18,652
91,583
68,578 r

177,443
141,542
10,019
25,882
328,592
125,143
86,086
20,378
96,985
60,686

166,798
132,275
9,703
24,820
318,071
123,256
82,190
20,756
91,869
57,676

169,278
134,218
9,570
25,490
314,736
116,325
81,812
19,984
96.615
59,610

172,304
139,170
9,249
23,885
317,868
115,323
84,439
19,822
98,284
64,108

171,648
138,532
9,073
24,043
314,912
112,598
84,909
18,915
98,490
60,381

164,142
128,611
10,830
24,701
315,428
110,189
87,225
18,694
99,320
64,263

12 Total payable in U.S. dollars

382,498

379,479

364,078'

374,420

365,824

353,643

361,251

353,315

344,319

180,174
142,962
12,513
24,699
174,451
95,298
36,440
12,298
30,415
24,854

r

171,938
138,424
9,291
24,223
182,360
83,902
45,931
13,995
38,532
20,122

162,125
129,329
9,266
23,530
183,527
83,117
47,250
14,313
38,847
20,172

164,681
131,554
9,213
23,914
171,120
77,606
41.616
13,883
38,015
17,842

167,773
136,650
8,704
22,419
174,726
77,681
43,067
13,710
40,268
18,752

167,051
135,939
8,336
22,776
170,338
75,871
41,266
13,068
40,133
15,926

159,541
126,181
10,168
23,192
169,206
73,049
43,566
12,537
40,054
15,572

1 Total payable in any currency

May

13 Claims on United States
14
Parent bank
15
Other banks in United States .
16
Nonbanks
17 Claims on foreigners
18
Other branches of parent bank
19
Banks
20
Public borrowers
21
Nonbank foreigners
22 Other assets

191,184
152,294
16,386
22,504
169,690
82,949
48,396
10,961
27,384
21,624

169,848
133,662r
12,025
24,161
167,010
78,114
41,635
13,685
33,576
27,220"

United Kingdom

...

161,947

184,818

175,599

168,333

165,850

164,360

165,132

162,122

163,194

24 Claims on United States
25
Parent bank
26
Other banks in United States .
27
Nonbanks
28 Claims on foreigners
29
Other branches of parent bank
30
Banks
31
Public borrowers
32
Nonbank foreigners
33 Other assets

39,212
35,847
1,058
2,307
107,657
37,728
36,159
3,293
30,477
15,078

45,560
42,413
792
2,355
115,536
46,367
31,604
3,860
33,705
23,722

35,257
31,931
1,267
2,059
109,692
35,735
36,394
3,306
34,257
30,650

38,358
35,027
925
2,406
113,193
45,092
34,559
3,370
30,172
16,782

36,403
33,460
1,298
1,645
111,623
46,165
33,399
3,329
28,730
17,824

37,609
34,290
886
2,433
108,362
42,894
33,513
3,059
28,896
18,389

34,919
32,779
783
1,357
110,420
41,317
36,601
2,542
29,960
19,793

34,989
31,719
892
2,378
106,944
39,466
34,914
2,531
30,033
20,189

33,353
29,605
757
2,991
109,428
39,673
38,138
2,755
28,862
20,413

34 Total payable in U.S. dollars

103,208

116,762

105,974

109,479

109,493

101,375

99,755

94,870

95,612

41,259
39,609
334
1,316
63,701
37,142
13,135
3,143
10,281

32,418
30,370
822
1,226
58,791
28,667
15,219
2,853
12,052
14,765

35,956
33,765
438
1,753
65,164
34,434
16,848
2,501
11,381
8,359

34,508
32,186
1,022
1,300
66,335
34,124
17,089
2,349
12,773
8,650

35,481
33,070
684
1,727
59,505
30,823
14,316
2,154
12,212
6,389

32,929
31,559
428
942
60,695
28,856
16,800
1,883
13,156
6,131

32,783
30,443
413
1,927
57,530
30,017
13,422
1,949
12,142
4,557

31,233
28,420
393
2,420
60,180
29,388
16,903
1,888
12,001
4,637

151,175

148,867

143,859

142,184
94.292
65,568
7,184
21,540
41.293
6,999
18,442
6,527
9,325
6,599
137,514

23 Total payable in any currency

—

35 Claims on United States
36
Parent bank
37
Other banks in United States .
38
Nonbanks
39 Claims on foreigners
40
Other branches of parent bank
41
Banks
42
Public borrowers
43
Nonbank foreigners
44 Other assets

36,404
34,329
843
1,232
59,062
29,872
16,579
2,371
10,240
7,742

11,802

Bahamas and Cayman Islands

45 Total payable in any currency . .

176,006

162,316

168,512'

156,176

147,422

144,894

46 Claims on United States
47
Parent bank
48
Other banks in United States
49
Nonbanks
50 Claims on foreigners
51
Other branches of parent bank
52
Banks
53
Public borrowers
54
Nonbank foreigners
55 Other assets

124,205
87,882
15,071
21,252
44,168
11,309
22,611
5,217
5,031
7,633

112,989
77,873
11,869
23,247
41,356
13,416
16,310
5,807
5,823
7,971

115,430"
81,706'
10,907
22,817
45,229
11,098
20,174
7,161
6,796
7,853

104,245
73,856
8,282
22,107
44,156
8,238
20,122
7,209
8,587
7,775

96,280
66,608
7,828
21,844
44,509
7,293
21,212
7,786
8,218
6,633

96,976
67,219
7,962
21,795
41,185
7,041
18,464
7,564
8,116
6,733

102,836
73,825
7,892
21,119
40,821
7,311
17,440
7,422
8,648
7,518

100,687
72,841
7,424
20,422
41,314
6,650
18,797
7,188
8,679
6,866

96,829
67,190
9,279
20,360
40,442
6,873
17,662
6,690
9,217
6,588

56 Total payable in U.S. dollars

170,780

158,390

163,957'

151,436

142,861

140,332

146,809

144,627

139,351

1. Since June 1984, reported claims held by foreign branches have been
reduced by an increase in the reporting threshold for " s h e l l " branches from $50




million to $150 million equivalent in total assets, the threshold now applicable to
all reporting branches.

A56
3.14

International Statistics • September 1993
FOREIGN BRANCHES OF U.S. BANKS

Balance Sheet Data1—Continued
1992

A

1993

*

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

All foreign countries

LIABILITIES

57

Total payable in any currency

545,366

556,925

548,999"

566,721

542,545

543,624

554,280

546,941

543,833

548,340

58
59
60
61
62

Negotiable certificates of deposit (CDs) . .
T o United States
Parent bank
Other banks in United States
Nonbanks

23,500
197,239
138,412
11,704
47,123

18,060
189,412
138,748
7,463
43,201

16,284
198,307"
136,431
13,260
48,616"

12,342
188,116
131,918
13,392
42,806

10,032
189,444
134,339
12,182
42,923

12,320
175,978
122,627
12,829
40,522

11,872
184,155
124,123
12,373
47,659

11,596
187,088
125,650
13,306
48,132

13,748
176,082
114,%5"
11,952
49,165"

14,348
174,889
116,691
14,062
44,136

63
64
65
66
67
68

To foreigners
Other branches of parent bank
Banks
Official institutions
Nonbank foreigners
Other liabilities

296,850
119,591
76,452
16,750
84,057
27,777

311,668
139,113
58,986
14,791
98,778
37,785

288,254
112,033
63,097
15,5%
97,528
46,154"

330,315
126,018
74,536
20,645
109,116
35,948

309,704
125,160
62,189
19,731
102,624
33,365

321,297
120,179
67,843
23,654
109,621
34,029

319,638
119,601
70,056
21,469
108,512
38,615

312,417
115,535
68,411
18,312
110,159
35,840

316,661
113,845
68,381"
21,326
113,109"
37,342

322,140
115,189
69,323
22,271
115,357
36,%3

69

Total payable in U.S. dollars

396,613

383,522

370,7^

372,819

368,773

353,725

363,285

353,431

343,867

343,766

70
71
72
73
74

Negotiable CDs
To United States
Parent bank
Other banks in United States
Nonbanks

19,619
187,286
132,563
10,519
44,204

14,094
175,654
130,510
6,052
39,092

11,909
185,472"
129,669
11,707
44,0%"

7,503
175,%9
124,770
12,246
38,953

6,238
178,674
127,948
11,512
39,214

7,102
164,634
116,008
11,710
36,916

6,640
172,223
117,228
11,418
43,577

6,519
175,354
119,040
12,467
43,847

7,062
163,715
107,949"
11,282
44,484"

7,248
161,775
109,645
13,126
39,004

75
76
77
78
79
80

To foreigners
Other branches of parent bank
Banks
Official institutions
Nonbank foreigners
Other liabilities

176,460
87,636
30,537
9,873
48,414
13,248

179,002
98,128
20,251
7,921
52,702
14,772

158,993
76,601
24,156
10,304
47,932
14,336"

175,791
82,957
28,404
12,342
52,088
13,556

172,189
83,700
26,118
12,430
49,941
11,672

169,595
79,144
23,281
14,067
53,103
12,394

170,756
79,594
25,571
14,034
51,557
13,666

160,774
77,685
21,227
10,762
51,100
10,784

163,149
75,682
22,150
12,627
52,690
9,941

165,162
75,313
22,%9
12,653
54,227
9,581

United Kingdom
81

Total payable in any currency

82
83
84
85
86

Negotiable CDs
To United States
Parent bank
Other banks in United States
Nonbanks

To foreigners
Other branches of parent bank
Banks
Official institutions
Nonbank foreigners
92 Other liabilities

87
88
89
90
91

161,947

184,818

175,599

168,333

165,850

164,360

165,132

162,122

163,194

165,044

20,056
36,036
29,726
1,256
5,054

14,256
39,928
31,806
1,505
6,617

11,333
37,720
29,834
1,438
6,448

5,636
34,532
26,471
1,689
6,372

4,517
39,174
31,100
1,065
7,009

5,774
32,780
25,099
1,742
5,939

5,597
33,092
24,250
1,633
7,209

4,753
38,011
29,759
1,192
7,060

5,414
34,661
22,611
1,110
10,940

5,644
37,272
28,095
1,652
7,525

92,307
27,397
29,780
8,551
26,579
13,548

108,531
36,709
25,126
8,361
38,335
22,103

98,167
30,054
25,541
9,670
32,902
28,379

113,395
35,560
30,609
11,438
35,788
14,770

107,176
35,983
25,231
12,090
33,872
14,983

111,351
35,376
25,%5
14,188
35,822
14,455

110,514
35,143
27,227
12,938
35,206
15,929

104,356
33,424
23,985
10,531
36,416
15,002

108,670
33,545
26,082
12,342
36,701
14,449

106,834
31,437
27,184
11,752
36,461
15,294

93

Total payable in U.S. dollars

108,178

116,094

108,755

105,699

108,214

100,731

101,342

95,892

94,159

96,152

94
95
96
97
98

Negotiable CDs
To United States
Parent bank
Other banks in United States
Nonbanks

18,143
33,056
28,812
1,065
3,179

12,710
34,697
29,955
1,156
3,586

10,076
33,003
28,260
1,177
3,566

4,494
30,204
25,160
906
4,138

3,894
35,417
29,957
709
4,751

4,770
28,545
23,767
1,063
3,715

4,444
28,874
23,097
1,097
4,680

3,765
33,552
28,405
707
4,440

4,214
30,170
21,145
676
8,349

4,392
32,457
26,631
1,311
4,515

T o foreigners
Other branches of parent bank
Banks
Official institutions
Nonbank foreigners
Other liabilities

50,517
18,384
12,244
5,454
14,435
6,462

60,014
25,957
9,488
4,692
19,877
8,673

56,626
20,800
11,069
7,156
17,601
9,050

62,899
22,8%
13,050
8,459
18,494
8,102

62,048
22,026
12,540
8,847
18,635
6,855

60,107
20,807
9,740
10,114
19,446
7,309

59,643
20,516
10,359
9,%7
18,801
8,381

51,850
19,516
6,702
7,008
18,624
6,725

54,407
18,958
8,327
8,803
18,319
5,368

54,576
17,449
9,065
8,210
19,852
4,727

99
100
101
102
103
104

Bahamas and Cayman Islands
105

Total payable in any currency

176,006

162,316

168,512r

156,176

147,422

144,894

151,175

148,867

143,859

142,184

106
107
108
109
110

Negotiable CDs
To United States
Parent bank
Other banks in United States
Nonbanks

678
124,859
75,188
8,883
40,788

646
114,738
74,941
4,526
35,271

1,173
130,058"
79,394
10,231
40,433"

1,939
116,699
71,381
10,944
34,374

1,350
111,861
67,347
10,445
34,069

1,355
108,150
65,122
10,265
32,763

1,142
110,729
62,336
10,059
38,334

1,713
110,391
59,668
11,492
39,231

1,692
105,895
59,416"
10,291
36,188"

1,812
102,211
56,566
11,220
34,425

To foreigners
Other branches of parent bank
Banks
Official institutions
Nonbank foreigners
116 Other liabilities

47,382
23,414
8,823
1,097
14,048
3,087

44,444
24,715
5,588
622
13,519
2,488

35,200
17,388
5,662
572
11,578
2,081

35,411
16,287
7,574
932
10,618
2,127

32,556
15,169
6,422
805
10,160
1,655

33,766
15,411
6,350
932
11,073
1,623

37,690
18,056
7,%7
1,036
10,631
1,614

35,369
18,015
6,476
858
10,020
1,394

34,773
17,462
6,219
905
10,187
1,499

36,146
18,626
6,123
1,052
10,345
2,015

Total payable in U.S. dollars

171,250

157,132

151,527

143,150

140,734

146,875

144,291

138,741

137,159

111
112
113
114
115

117




163,789"

Summary Statistics

A57

3.15 SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS
Millions of dollars, end of period
1993

1992
Item

1990

1991
Nov.

1 Total 1
2
3
4
5
6
7
8
9
10
11
12

Dec.

344,529

360,530

394,841

39,880
79,424

38,3%
92,692

54,007
100,702

r

By type
Liabilities reported by banks in the United States-'
U.S. Treasury bills and certificates 3
U.S. Treasury bonds and notes
Marketable
Nonmarketable
U.S. securities other than U.S. Treasury securities

202,487
4,491
18,247

203,677
4,858
20,907

211,268
4,503
24,361

By area
Western Europe 1
Canada
Latin America and Caribbean
Asia
Africa
Other countries 6

167,191
8,671
21,184
138,0%
1,434
7,955

168,365
7,460
33,554
139,465
2,092
9,592

184,204r
6,381
38,945
154,493
3,779
7,037 r

1. Includes the Bank for International Settlements.
2. Principally demand deposits, time deposits, bankers acceptances, commercial paper, negotiable time certificates of deposit, and borrowings under repurchase agreements.
3. Includes nonmarketable certificates of indebtedness (including those payable
in foreign currencies through 1974) and Treasury bills issued to official institutions
of foreign countries.
4. Excludes notes issued to foreign official nonreserve agencies. Includes
bonds and notes payable in foreign currencies; zero coupon bonds are included at
current value.

r

Jan.

398,672

411,802

54,823
104,5%

63,792
111,540

Feb.
r

413,220

r

Mar.

Apr.*

May?

409,977*

413,255

423,033

66,454
113,594

62,974
113,547

62,480
113,293

67,624
120,785

210,553
4,532
24,168

207,573
4,563
24,334

r

203,209*
4,592
25,371

202,552*
4,622
26,282

205,138
5,431
26,913

201,851
5,417
27,356

188,700*
7,920
40,015
152,142r
3,565
6,328 r

l%,232 r
8,411
41,388
156,205r
3,705
5,859 r

199,65l r
7,886
42,502
154,009*
3,866
5,304*

187,394*
9,326
44,509
157,912*
3,919
6,915*

184,986
8,302
48,970
159,623
3,782
7,590

190,992
8,899
47,592
164,114
3,782
7,652

5. Debt securities of U.S. government corporations and federally sponsored
agencies, and U.S. corporate stocks and bonds.
6. Includes countries in Oceania and Eastern Europe.
SOURCE. Based on Treasury Department data and on data reported to the
Treasury Department by banks (including Federal Reserve Banks) and securities
dealers in the United States and on the 1984 benchmark survey of foreign portfolio
investment in the United States.

3.16 LIABILITIES TO, AND CLAIMS ON, FOREIGNERS Reported by Banks in the United States1
Payable in Foreign Currencies
Millions of dollars, end of period
1993*

1992*
Item

1 Banks' liabilities
2 Banks' claims
3
Deposits
4
Other claims
5 Claims of banks' domestic customers

1989

67,835
65,127
20,491
44,636
3,507

1. Data on claims exclude foreign currencies held by U.S. monetary
authorities.




1990

70,477
66,7%
29,672
37,124
6,309

1991

75,129
73,195
26,192
47,003
3,398

June

Sept.

Dec.

Mar.

70,%9
58,354
23,468
34,886
4,375

84,162
72,164
28,074
44,090
3,987

72,7%
62,789
24,240
38,549
4,432

82,201
64,061
25,014
39,047
2,625

2. Assets owned by customers of the reporting bank located in the United
States that represent claims on foreigners held by reporting banks for the accounts
of the domestic customers.

A58

International Statistics • September 1993

3.17 LIABILITIES TO FOREIGNERS
Payable in U.S. dollars

Reported by Banks in the United States1

Millions of dollars, end of period
1992
1990

Item

1991

1993

1992
Nov.

Dec.

Jan.

Feb.

Mar."

Apr."

May"

HOLDER AND TYPE OF LIABILITY

1 Total, all foreigners

759,634

756,066

810,025r

801,930 r

810,025 r

802,216"

814,725 r

798,117

791,119

793,006

2 Banks' own liabilities
3
Demand deposits
4
Time deposits 2
5
Other.
Own foreign offices
6

577,229
21,723
168,017
65,822
321,667

575,374
20,321
159,649
66,305
329,099

606,210"
21,823 r
160,374r
93,840"
330,173r

603,413"
21,935
156,601"
96,547"
328,330"

606,210"
21,823"
160,374"
93,840"
330,173"

592,754"
21,106
150,062"
103,910"
317,676"

606,005"
22,310
147,284"
106,262"
330,149"

586,175
21,582
141,905
99,193
323,495

581,291
22,239
145,659
103,328
310,065

574,204
22,136
145,155
106,386
300,527

182,405
96,796

180,692
110,734

203,815 r
127,649

198,517
122,480

203,815"
127,649

209,462"
133,799

208,720"
135,300

211,942
137,062

209,828
138,016

218,802
144,725

17,578
68,031

18,664
51,294

21,982
54,184 r

21,755
54,282

21,982
54,184"

22,%9
52,694"

20,735
52,685"

22,309
52,571

21,550
50,262

23,971
50,106

5,918
4,540
36
1,050
3,455

8,981
6,827
43
2,714
4,070

9,350
6,951
46
3,214
3,691

9,915
6,982
58
2,561
4,363

9,350
6,951
46
3,214
3,691

11,099
7,837
39
2,702"
5,0%"

11,538
8,884
47
2,311"
6,526"

9,160
5,902
2,622
3,084

10,731
5,834
33
1,687
4,114

8,974
6,481
35
2,989
3,457

1,378
364

2,154
1,730

2,399
1,908

2,933
2,371

2,399
1,908

3,262
2,774

2,654
2,348

3,258
2,876

4,897
4,461

2,493
1,883

1,014
0

424
0

486
5

561
1

486
5

488
0

306
0

382
0

433
3

604
6

119,303
34,910
1,924
14,359
18,628

131,088
34,411
2,626
16,504
15,281

159,419
51,058
1,274
17,823r
31,961 r

154,709
50,027
1,492
17,735"
30,800"

159,419
51,058
1,274
17,823"
31,961"

175,332
59,577
1,397
18,685
39,495

180,048
62,687
1,764
18,9%
41,927

176,521
59,471
1,457
18,727
39,287

175,773
59,059
1,358
18,853
38,848

188,409
62,741
1,385
21,416
39,940

84,393
79,424

96,677
92,692

108,361
104,596

104,682
100,702

108,361
104,5%

115,755
111,540

117,361
113,594

117,050
113,547

116,714
113,293

125,668
120,785

4,766
203

3,879
106

3,726
39

3,784
196

3,726
39

4,054
161

3,648
119

3,411
92

3,284
137

4,739
144

540,805
458,470
136,802
10,053
88,541
38,208
321,667

522,265
459,335
130,236
8,648
82,857
38,731
329,099

546,556r
475,340"
145,167r
10,168
90,175 r
44,824 r

82,335
10,669

62,930
7,471

5,341
66,325

7 Banks' custodial liabilities 5
8
U.S. Treasury bills and certificates
Other negotiable and readily transferable
9
instruments 7
Other
10
11 Nonmonetary international and regional
organizations
Banks' own liabilities
12
13
Demand deposits
14
Time deposits
15
Other.
16
17

18
19

Banks' custodial liabilities 5
U.S. Treasury bills and certificates 6
Other negotiable and readily transferable
instruments 7
Other

20 Official institutions 9
Banks' own liabilities
21
Demand deposits
22
Time deposits
23
24
Other
25
26
27
28

Banks' custodial liabilities 5
U.S. Treasury bills and certificates 6
Other negotiable and readily transferable
instruments 7
Other

29 Banks 1 0
Banks' own liabilities
30
Unaffiliated foreign banks
31
Demand deposits
32
Time deposits
33
34
Other.
Own foreign offices
35
36
37

38
39

5

Banks' custodial liabilities
U.S. Treasury bills and certificates 6
Other negotiable and readily transferable
instruments 7
Other

Other foreigners
Banks' own liabilities
Demand deposits
43
Time deposits
Other
44

40

41
42

45
46
47
48

Banks' custodial liabilities 5
U.S. Treasury bills and certificates 6
Other negotiable and readily transferable
instruments 7
Other

1%

546,350"
475,319"
146,989"
10,088
87,477"
49,424"
328,330"

546,556"
475,340"
145,167"
10,168
90,175"
44,824"
330,173"

522,700"
453,849"
136,173"
9,903
80,351
45,919"
317,676"

530,365"
462,769"
132,620"
10,974
77,823
43,823"
330,149"

520,516
451,438
127,943
10,495
72,422
45,026
323,495

511,473
445,235
135,170
10,883
77,457
46,830
310,065

503,753
436,864
136,337
11,382
74,035
50,920
300,527

71,216R

71,031

11,087

10,444

71,216"
11,087

68,851"
9,685

67,5%"
9,2%

69,078
9,976

66,238
9,908

66,889
10,837

5,694
49,765

7,568
52,561 r

7,572
53,015

7,568
52,561"

7,708
51,458"

6,692
51,608"

7,957
51,145

7,360
48,970

7,412
48,640

93,608
79,309
9,711
64,067
5,530

93,732
74,801
9,004
57,574
8,223

94,700"
72,861"
10,335"
49,162"
13,364"

90,956"
71,085"
10,297
48,828"
11,960"

94,700"
72,861"
10,335"
49,162"
13,364"

93,085"
71,491"
9,767
48,324"
13,400"

92,774"
71,665"
9,525
48,154"
13,986"

91,920
69,364
9,434
48,134
11,7%

93,142
71,163
9,%5
47,662
13,536

91,870
68,118
9,334
46,715
12,069

14,299
6,339

18,931
8,841

21,839
10,058

19,871
8,963

21,839
10,058

21,594
9,800

21,109
10,062

22,556
10,663

21,979
10,354

23,752
11,220

6,457
1,503

8,667
1,423

10,202

9,838
1,070

10,202

1,579

10,719
1,075

10,089
958

10,559
1,334

10,473

1,579

1,152

11,216
1,316

7,073

7,456

9,114

7,716

9,114

9,724

9,499

9,548

9,410

9,585

330,173R

MEMO

49 Negotiable time certificates of deposit in custody for
foreigners

1. Reporting banks include all types of depository institution, as well as some
brokers and dealers.
2. Excludes negotiable time certificates of deposit, which are included in
"Other negotiable and readily transferable instruments."
3. Includes borrowing under repurchase agreements.
4. For U.S. banks, includes amounts owed to own foreign branches and foreign
subsidiaries consolidated in Consolidated Report of Condition filed with bank
regulatory agencies. For agencies, branches, and majority-owned subsidiaries of
foreign banks, consists principally of amounts owed to head office or parent
foreign bank, and foreign branches, agencies, or wholly owned subsidiaries of
head office or parent foreign bank.
5. Financial claims on residents of the United States, other than long-term
securities, held by or through reporting banks.




6. Includes nonmarketable certificates of indebtedness and Treasury bills
issued to official institutions of foreign countries.
7. Principally bankers acceptances, commercial paper, and negotiable time
certificates of deposit.
8. Principally the International Bank for Reconstruction and Development, the
Inter-American Development Bank, and the Asian Development Bank. Excludes
"holdings of dollars" of the International Monetary Fund.
9. Foreign central banks, foreign central governments, and the Bank for
International Settlements.
10. Excludes central banks, which are included in "Official institutions."

Nonbank-Reported

Data

3.17—Continued
1993
1990

1991

1992
Nov.

Dec

Jan.

Feb.

Mar.

Apr/

AREA

1 Total, all foreigners .

759,634

756,066

810,025r

801,930 r

810,025*

802,216 r

814,725'

798,117'

791,119

2 Foreign countries . . .

753,716

747,085

800,675'

792,015'

800,675*

791,117*

803,187*

788,957'

780,388

254,452
1,229
12,382
1,399
602
30,946
7,485
934
17,735
5,350
2,357
2,958
7.544
1,837
36,690
1,169
109,555
928
11,689
119
1.545

249,097
1,193
13,337
937
1,341
31,808
8,619
765
13,541
7,161
1,866
2,184
11,391
2,222
37,238
1,598
100,292
622
9,274
241
3,467

308,418r
1,611
20,572
3,060
1,299
41,459
18,631
910
10,041
7,372
3,319
2,465
9,796
2,986
39,440
2,666
112,454r
504
25,834
577
3,422

311,838 r
l,356 r
19,662
1,481
1,144
39,968
15,401
749
12,494
8,411
2,014
2,255
10,390*
4,424 r
40,791
2,360
117,373*
575
26,690*
601
3,699

308,418*
1,611
20,572
3,060
1,299
41,459
18,631
910
10,041
7,372
3,319
2,465
9,7%
2,986
39,440
2,666
112,454*
504
25,834
577
3,422

303,751*
1,158
21,255
1,885
1,862
34,285
20,685
815
8,759
8,722*
3,550
2,518
14,904
2,%2
41,533
2,533
106,739*
506
25,926
436
2,718

304,752'
1,942
19,729
2,835
2,049
32,457
18,934
758
10,701
11,702*
2,521
2,508
17,233
1,902
40,227
2,862
105,510*
512
27,491
497
2,382

293,346*
1,256
19,475
1,536
2,297
31,712
16,107
763*
8,889*
11,409*
2,350
2,489
15,735
1,619
39,5%
2,520
106,328*
523
25,748
535
2,459

298,874
1,497
19,775
1,229
2,265
31,087
19,803
742
8,094
11,502
2,355
2,476
14,055
3,149
39,703
2,664
109,553
507
24,521
726
3,171

3 Europe
4
Austria
Belgium and Luxembourg . .
Denmark
Finland
France
Germany
Greece
11
Italy
12
Netherlands
13
Norway
14
Portugal
15
Spain
16
Sweden
17
Switzerland
18
Turkey
19
United Kingdom
20
Yugoslavia.
21
Others in Western Europe 1 2
22
Russia
23
Other Eastern Europe 1 3 —

20,349

21,605

22,746

22,052

22,746

21,467

22,898

25,040

22,302

25 Latin America and Caribbean.
26
Argentina
27
Bahamas
28
Bermuda
29
Brazil
30
British West Indies
31
Chile
32
Colombia
33
Cuba
34
Ecuador
35
Guatemala
36
Jamaica
37
Mexico
38
Netherlands Antilles
39
Panama
40
Peru
41
Uruguay
42
Venezuela
43
Other

332,997
7,365
107,386
2,822
5,834
147,321
3,145
4,492
11
1,379
1,541
257
16,650
7,357
4,574
1,294
2,520
12,271
6,779

345,529
7,753
100,622
3,178
5,704
163,620
3,283
4,661
2
1,232
1,594
231
19,957
5,592
4,695
1,249
2,096
13,181
6,879

316,020r
9,477
82,222r
7.079
5,584
151,886
3,035
4,580
3
993
1,377
371
19,456
5,205
4,177
1.080
1,955
11,387
6,153 r

312,118*
8,716*
86,318*
6,355
5,236*
145,375*
2,931*
4,675*
11
1,022*
1,324*
271
19,567*
6,098*
3,965*
1,059*
2,092
11,020*
6,083*

316,020*
9,477
82,222*
7.079
5,584
151,886
3,035
4,580
3
993
1,377
371
19,456
5,205
4,177
1.080
1,955
11,387
6,153*

313,754*
10,792
84,777*
6,319
5,321
147,375*
3,638
4,438
2
945
1,311
294
20,023
4,352
4,013
1,052
1,898
11,106
6,098

321,062*
10,608
87,812*
6,508
5,304
150,063*
3,420
4,417
3
886
1,311
279
21,1%*
4,869
4,214
1,045
2,061
10,984
6,082

318,681*
11,568
83,597*
6,269*
5,462
151,216*
3,325
4,183
3
928
1,382
309
21,762*
4,221
3,927
995
1,815
11,446
6,273*

316,472
10,856
81,737
6,135
5.463
147,386
3,479
4,359
2
919
1,352
293
24,8%
4,537
4,154
1,070
1,767
11,511
6,556

44 Asia
China
45
People's Republic of China
46
Republic of China (Taiwan)
47
Hong Kong
48
India
49
Indonesia
50
Israel
51
Japan
52
Korea (South)
53
Philippines
54
Thailand
55
Middle Eastern oil-exporting countries 1 4
56
Other

136,844

120,462

143,436r

136,120*

143,436*

141,633*

143,636*

140,335*

130,994

2,421
11,246
12,754
1,233
1,238
2,767
67,076
2,287
1,585
1.443
15,829
16,965

2,626
11,491
14,269
2,418
1.463
2,015
47,069
2,587
2,449
2,252
15,752
16,071

3,202
8,379
18,509*
1,396
1,480
3,775
58,342 r
3,336
2,275
5,582
21,446
15,714

2,559
8,750
16,322
1,210
1,217
3,691
55,365*
3,698
2,223
5,797
20,266
15,022

3,202
8,379
18,509*
1,3%
1,480
3,775
58,342*
3,336
2,275
5,582
21,446
15,714

3,114
8,929
17,588*
1,323
1,392
3,389
56,009*
3,444*
2,350
5,722
19,877
18,4%

3,007
9,102
19,543*
1,377
1,460
3,371
57,993
3,488*
2,746
5,375
19,897
16,277

2,957
9,022
17,041*
1,399
1,871
3,930
56,845
3,337*
2,774
5,342
19,718*
16,099

3,527
8,856
16,353
989
1.464
3,763
51,104
3,591
2,785
4,%7
19,687
13,908

57 Africa
58
Egypt
59
Morocco
60
South Africa
61
Zaire
62
OA-exporting countries
63
Other

4,630
1,425
104
228
53
1,110
1,710

4,825
1,621
79
228
31
1,082
1,784

5,884
2,472
76
190
19
1,346
1,781

6,062
2,601
93
214
23
1,402
1,729

5,884
2,472
76
190
19
1,346
1,781

5,913
2,756
88
158
25
1,125
1,761

6,364
3,077
92
319
17
1,135
1,724

6,508*
3,084
87
243
13
1,239
1,842*

6,438
2,938
151
246
14
1,294
1,795

64 Other
65
Australia
66
Other . . .

4.444
3,807
637

5,567
4.464
1,103

4,171
3,047
1,124

3,825
2,654
1,171

4,171
3,047
1,124

4,599
3,502
1,097

4,475
3,388
1,087

5,047
4,013
1,034

5,308
4,056
1,252

67 Nonmonetary international and regional
organizations
International 1 6
Latin American regional 1
Other regional 18

5,918
4,390
1,048
479

8,981
6,485
1,181
1,315

9,350
7,434
1,415
501

9,915
6,764
2,248
903

9,350
7,434
1,415
501

11,099
7,864
2,327
908

11,538
8,857
1,738
943

9,160
6,116
2,021
1,023

10,731
7,590
2,223
918

24 Canada.

68
69
70

11. Since December 1992, has excluded Bosnia, Croatia, and Slovenia.
12. Includes the Bank for International Settlements and Eastern European
countries not listed in line 23. Since December 1992, has included, in addition, all
former parts of the U.S.S.R. (except Russia), and Bosnia-Hercegovina, Croatia,
and Slovenia.
13. Comprises Bulgaria, Czechoslovakia, Hungary, Poland, and Romania.
14. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).




15. Comprises Algeria, Gabon, Libya, and Nigeria.
16. Principally the International Bank for Reconstruction and Development.
Excludes "holdings of dollars" of the International Monetary Fund.
17. Principally the Inter-American Development Bank.
18. Asian, African, Middle Eastern, and European regional organizations,
except the Bank for International Settlements, which is included in "Other
Western E u r o p e . "

A59

A60

International Statistics • September 1993

3.18 BANKS' OWN CLAIMS ON FOREIGNERS
Payable in U.S. Dollars

Reported by Banks in the United States1

Millions of dollars, end of period
1992
Area and country

1990

1991

1993

1992
Nov.

Dec.

Jan.

Feb.

Mar."

Apr."

May"

1 Total, all foreigners

511,543

514,339

495,761 r

490,768"

495,761"

484,670"

495,033"

473,944

469,559

458,629

2 Foreign countries

506,750

508,056

490,679"

487,887"

490,679"

481,570"

490,925"

470,622

467,142

456,947

113,093
362
5,473
497
1,047
14,468
3,343
727
6,052
1,761
782
292
2,668
2,094
4,202
1,405
65,151
1,142
597
530
499

114,310
327
6,158
686
1,907
15,112
3,371
553
8,242
2,546
669
344
1,881
2,335
4,540
1,063
60,395
825
789
1,970
597

124,130
341
6,404
707
1,419
14,847
4,229
718
9,048
2,497
356
325
2,772
4,929
4,722
%2
63,980
569
1,706
3,147
452

122,156"
463
6,423
1,056
1,230
15,718
5,328
598
9,443
3,006
435
330
3,481
5,781"
3,591
950
59,009"
661
1,019
3,174
460

124,130
341
6,404
707
1,419
14,847
4,229
718
9,048
2,497
356
325
2,772
4,929
4,722
%2
63,980
569
1,706
3,147
452

117,355"
366
6,473
705
1,275
14,012
5,544
670"
8,716
2,927
649
390
2,593
5,340
4,493
1,071
56,308"
571
1,607
3,154
491

124,763"
530
5,886
785
1,226
14,670
5,370
668
8,466
3,279
750
494
4,158
5,155
4,971
1,041
61,433"
567
1,607
3,154
553

122,721
1,101
6,066
682
1,010
13,340
5,800
583
8,493
2,676
645
454
3,889
4,809
4,423
943
62,098
553
1,780
2,906
470

120,310
1,013
6,177
645
998
13,141
5,322
618
8,724
2,607
714
513
3,642
4,509
4,355
1,285
60,722
551
1,316
2,889
569

118,175
1,357
5,097
628
885
11,614
6,089
5%
8,218
3,278
676
593
3,441
4,229
4,729
1,508
59,665
550
1,455
3,080
487

3
4
5
6
7
8
9
10
11
17
13
14
IS
16
17
18
19
70
71
??
23

Belgium and Luxembourg

Italy
Netherlands

Turkey
United Kingdom
Others in Western Europe
Other Eastern Europe

16,091

15,113

14,185

15,834

14,185

16,465"

14,972

18,356

17,090

16,461

75 Latin America and Caribbean
76
77
78
79
Brazil
30
31
Chile
37
33
Cuba
34
35
36
37
Netherlands Antilles
38
39
40
41
47
Other
43

231,506
6,967
76,525
4,056
17,995
88,565
3,271
2,587
0
1,387
191
238
14,851
7,998
1,471
663
786
2,571
1,384

246,137
5,869
87,138
2,270
11,894
107,846
2,805
2,425
0
1,053
228
158
16,567
1,207
1,560
739
599
2,516
1,263

213,772
4,882
59,532
5,934
10,733
98,738
3,397
2,750
0
884
262
167
15,049
1,379
4,474
730
936
2,525
1,400

217,036"
4,605
65,139
6,035
11,581"
%,323"
3,309
2,698
0
926
255
162
16,495
1,529
2,080
723
877
2,880
1,419

213,772
4,882
59,532
5,934
10,733
98,738
3,397
2,750
0
884
262
167
15,049
1,379
4,474
730
936
2,525
1,400

219,079"
4,804
62,831
6,797
10,924
101,614"
3,690
2,752
0
853
240
170
15,216
1,735
2,024
735
895
2,409
1,390

212,204"
4,859
63,898
2,851
10,507
%,324"
3,795
2,819
0
835
257
164
15,988
1,938
2,307
708
844
2,485
1,625"

202,343
4,835
57,030
3,910
10,863
92,666
3,638
2,807
0
809
274
168
15,103
2,107
2,539
650
846
2,558
1,540

200,804
3,922
57,721
5,609
10,799
89,191
3,548
2,786
0
798
269
161
15,533
1,971
2,309
691
787
2,859
1,850

194,931
3,932
54,118
3,089
10,6%
90,023
3,717
2,875
0
760
256
158
14,966
2,354
2,268
675
778
2,541
1,725

44

138,722

125,262

131,296"

126,181"

131,2%"

121,777"

131,494

119,578

121,956

120,546

620
1,952
10,648
655
933
774
90,699
5,766
1,247
1,573
10,749
13,106

747
2,087
9,617
441
952
860
84,807
6,048
1,910
1,713
8,284
7,7%

906
2,046
9,673
529
1,189
820
78,647"
6,180"
2,145
1,867
18,559
8,735

624
1,653
9,287
539
1,135
937
77,714"
6,288
2,034
1,873
16,858
7,239

906
2,046
9,673
529
1,189
820
78,647"
6,180"
2,145
1,867
18,559
8,735

774
1,683
9,145
532
1,323
877
74,631"
6,073"
1,871
1,7%
17,083
5,989

892
1,585
10,298
549
1,292
809
79,791
6,753
1,842
1,737
17,775
8,171

939
1,630
10,542
443
1,469
8%
67,294
6,938
1,713
1,678
19,048
6,988

1,388
1,670
9,215
549
1,432
1,057
71,244
7,048
1,645
1,794
17,909
7,005

881
1,562
10,419
489
1,386
814
71,471
7,206
1,521
1,692
17,953
5,152

5,445
380
513
1,525
16
1,486
1,525

4,928
294
575
1,235
4
1,298
1,522

4,289
194
441
1,041
4
1,004
1,605

4,233
214
443
1,063
4
1,029
1,480

4,289
194
441
1,041
4
1,004
1,605

4,262
171
421
1,069
3
1,067
1,531

4,147
291
403
1,030
3
1,108
1,312

3,871
192
3%
1,011
3
1,140
1,129

3,731
151
3%
924
3
1,128
1,129

3,626
151
420
803
3
1,134
1,115

64 Other
65
Australia
Other
66

1,892
1,413
479

2,306
1,665
641

3,007
2,263
744

2,447
1,601
846

3,007
2,263
744

2,632
1,8%
736

3,345
2,552
793

3,753
3,117
636

3,251
2,635
616

3,208
2,534
674

67 Nonmonetary international and regional
organizations

4,793

6,283

5,082

2,881

5,082

3,100

4,108

3,322

2,417

1,682

24 Canada

45
46
47
48
49
50
51
57
53
54
55
56
57
58
59
60
61
67
63

China
People's Republic of China
Republic of China (Taiwan)

Korea (South)
Thailand
<
Middle Eastern oil-exporting countries 5
Other
Egypt
South Africa
Zaire
Oil-exporting countries
Other

1. Reporting banks include all types of depository institutions, as well as some
brokers and dealers.
2. Since December 1992, has excluded Bosnia, Croatia, and Slovenia.
3. Includes the Bank for International Settlements and Eastern European
countries not listed in line 23. Since December 1992, has included, in addition, all
former parts of the U.S.S.R. (except Russia), and Bosnia-Hercegovina, Croatia,
and Slovenia.




4. Comprises Bulgaria, Czechoslovakia, Hungary, Poland, and Romania.
5. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).
6. Comprises Algeria, Gabon, Libya, and Nigeria.
7. Excludes the Bank for International Settlements, which is included in
"Other Western E u r o p e . "

Nonbank-Reported
3.19 BANKS' OWN AND DOMESTIC CUSTOMERS' CLAIMS ON FOREIGNERS
United States1
Payable in U.S. Dollars

Data

Reported by Banks in the

Millions of dollars, end of period
1992r
Claim

1990

579,044

1 Total

1991

579,683

1993

1992r
Feb/

Mar. r

555,799

525,833

495,761
31,245
299,916
109,788
60,949
48,839
54,812

495,033
30,349
305,438
102,737
50,634
52,103
56,509

473,944
33,631
290,671
97,320
49,134
48,186
52,322

Nov.

Dec.

555,799
490,768
30,849
291,126
112,308
61,752
50,556
56,485

Jan. r

511,543
41,900
304,315
117,272
65,253
52,019
48,056

514,339
37,126
318,800
116,602
69,018
47,584
41,811

495,761
31,245
299,916
109,788
60,949
48,839
54,812

67,501
14,375

65,344
15,280

60,038
15,452

60,038
15,452

51,889
12,000

41,333

37,125

31,454

31,454

27,283

11,792

12,939

13,132

13,132

12,606

13 Customer liability on acceptances

13,628

8,974

8,700

8,700

7,876

14 Dollar deposits in banks abroad,
reported by nonbanking business
enterprises in the United States

44,638

40,297 r

33,604

2 Banks' claims
3
Foreign public borrowers
4
Own foreign offices
5
Unaffiliated foreign banks
6
Deposits
7
Other
8
All other foreigners
9 Claims of banks' domestic c u s t o m e r s 3 . . .
10
Deposits
11
Negotiable and readily transferable
instruments
12
Outstanding collections and other
claims

484,670
32,972
291,819
101,868
52,707
49,161
58,011

Apr/

May"

469,559
30,631
285,196
97,805
47,940
49,865
55,927

458,629
29,483
280,311
94,729
47,310
47,419
54,106

33,501

n.a.

MEMO

33,710

33,604

36,127

36,801

36,425

foreign bank, and foreign branches, agencies, or wholly owned subsidiaries of
head office or parent foreign bank.
3. Assets held by reporting banks in the accounts of their domestic customers.
4. Principally negotiable time certificates of deposit and bankers acceptances.
5. Includes demand and time deposits and negotiable and nonnegotiable
certificates of deposit denominated in U.S. dollars issued by banks abroad. For
description of changes in data reported by nonbanks, see Federal
Reserve
Bulletin, vol. 65 (July 1979), p. 550.

1. For banks' claims, data are monthly; for claims of banks' domestic customers, data are quarterly.
Reporting banks include all types of depository institution, as well as some
brokers and dealers.
2. For U . S . banks, includes amounts due from own foreign branches and
foreign subsidiaries consolidated in Consolidated Report of Condition filed with
bank regulatory agencies. For agencies, branches, and majority-owned subsidiaries of foreign banks, consists principally of amounts due from head office or parent

3.20 BANKS' OWN CLAIMS ON UNAFFILIATED FOREIGNERS
Payable in U.S. Dollars

Reported by Banks in the United States1

Millions of dollars, end of period
1992r
Maturity, by borrower and area 2

1 Total
2
3
4
5
6
7

By borrower
Maturity of one year or less
Foreign public borrowers
All other foreigners
Maturity of more than one year
Foreign public borrowers
All other foreigners

By area
Maturity of one year or less
Europe
Canada
Latin America and Caribbean
Asia
Africa
All other 3
Maturity of more than one year
14
Europe
15
Canada
16
Latin America and Caribbean
17
18
Africa
19
All other 3
8
9
10
11
12
13

1989

1993

1991
June

Sept.

Dec.

Mar.

238,123

206,903

195,302

196,776

187,272

195,517

182,949

178,346
23,916
154,430
59,776
36,014
23,762

165,985
19,305
146,680
40,918
22,269
18,649

162,573
21,050
141,523
32,729
15,859
16,870

162,382
20,400
141,982
34,394
15,165
19,229

155,072
17,739
137,333
32,200
13,314
18,886

163,873
17,689
146,184
31,644
13,268
18,376

152,965
21,140
131,825
29,984
12,199
17,785

53,913
5,910
53,003
57,755
3,225
4,541

49,184
5,450
49,782
53,258
3,040
5,272

51,835
6,444
43,597
51,059
2,549
7,089

55,123
7,986
48,983
41,343
2,127
6,820

55,964
5,949
45,241
40,664
2,183
5,071

53,865
6,118
50,316
45,726
1,784
6,064

55,526
7,932
45,117
37,935
1,680
4,775

4,121
2,353
45,816
4,172
2,630
684

3,859
3,290
25,774
5,165
2,374
456

3,878
3,595
18,277
4,459
2,335
185

6,752
3,158
16,847
5,018
2,356
263

6,624
3,227
15,111
4,853
2,107
278

5,380
3,290
15,159
5,015
2,390
410

4,896
3,139
14,386
5,033
2,094
436

1. Reporting banks include all kinds of depository institutions besides commercial banks, as well as some brokers and dealers.




1990

2. Maturity is time remaining to maturity,
3. Includes nonmonetary international and regional organizations.

A61

A62

International Statistics • September 1993

3.21 CLAIMS ON FOREIGN COUNTRIES

Held by U.S. Offices and Foreign Branches of U.S.-Chartered Banks1

Billions of dollars, end of period

1989

1990
Mar.

1 Total

6

Italy

19
20
21

Portugal
Spain
Turkey

23

South Africa

25 OPEC 2

Latin
33
34

Brazil
Chile

37
38

Peru
Other

1993

1992

1991
Area or country

r

June
r

Sept.

Mar.

Dec.
r

349.8

June
r

Sept.

Mar.

Dec.
r

340.9"

320. l

322.3"

338.4"

343.6

357.4

343.9

345.6

152.9
6.3
11.7
10.5
7.4
3.1
2.0
7.1
67.2
5.4
32.3 r

132.2"
5.9
10.4
10.6
5.0
3.0
2.2
4.4
60.9"
5.9
24.0"

129.3"
6.2
9.7
8.8
4.0
3.3
2.0
3.7
61.7"
6.8
23.2

130.3"
6.1
10.5
8.3
3.6
3.3
2.5
3.3
59.5
8.2
25.1"

135.0"
5.8
11.1
9.7
4.5
3.0
2.1
3.9
65.6"
5.8
23.5"

137.6"
6.0
11.0
8.3
5.6
4.7
1.9
3.4
68.5
5.8
22.6"

131.1
5.3
10.0
8.4
5.4
4.3
2.0
3.2
64.8
6.6
21.1

136.3
6.2
12.0
8.8
8.0
3.3
1.9
4.6
65.9
6.7
18.7

137.5
6.2
15.5
10.9
6.4
3.7
2.2
5.2
61.9"
6.7
18.9

134.0
5.6
15.4
9.3
6.5
2.8
2.3
4.8
61.4
6.6
19.2

144.1
5.9
13.7
10.0
6.8
3.7
3.0
5.4
66.5
8.6
20.5

21.0
1.5
1.1
1.0
2.5
1.4
.4
7.1
1.2
1.0
2.0
1.6

22.9
1.4
1.1
.7
2.7
1.6
.6
8.3
1.7
1.2
1.8
1.8

23.5
1.4
.9
1.0
2.5
1.5
.6
9.0
1.7
1.2
1.8
1.9

21.3
1.1
1.2
.8
2.4
1.5
.6
7.1
1.9
1.1
1.8
2.0

22.1
1.0
.9
.6
2.3
1.4
.5
8.3
1.6
1.3
1.6
2.4

22.8
.6
.9
.7
2.6
1.4
.6
8.3
1.4
1.8
1.9
2.7

21.5
.8
.8
.8
2.3
1.5
.5
7.7
1.2
1.5
1.8
2.3

25.5
.8
1.3
.8
2.8
1.7
.5
10.1
1.5
2.0
1.7
2.3

25.1
.8
1.5
1.0
3.0
1.6
.5
9.8
1.5
1.5
1.7
2.3

24.1
1.2
.9
.7
3.0
1.2
.4
9.0
1.3
1.7
1.7
2.9

25.6
1.5
.8
.7
2.8
1.8
.7
9.6
1.4
2.0
1.6
2.8

17.1
1.3
7.0
2.0
5.0
1.7

12.8
1.0
5.0
2.7
2.5
1.7

17.1
.9
5.1
2.8
6.6
1.6

14.0
.9
5.3
2.6
3.7
1.5

15.6
.8
5.6
2.8
5.0
1.5

14.5"
.7
5.4
2.7"
4.2
1.5

15.8
.7
5.4
3.0
5.3
1.4

16.2
.7
5.3
3.0
5.9
1.4

15.9
.7
5.4
3.0
5.4
1.4

16.1
.6
5.2
3.0
6.2
1.1

16.7
.6
5.3
3.1
6.7
1.0

77.5

65.4

66.4

64.4"

64.7"

63.9"

69.7"

68.1

72.9

72.2

74.3

6.3
19.0
4.6
1.8
17.7
.6
2.8

5.0
14.4
3.5
1.8
13.0
.5
2.3

4.7
13.9
3.6
1.7
13.7
.5
2.2

4.6
11.6
3.6
1.6
14.3
.5
2.0

4.5
10.5
3.7
1.6
16.2
.4
1.9

4.8
9.6
3.6
1.7
15.5
.4
2.1

5.0
10.8
3.9
1.6
17.7"
.4
2.2

5.1
10.6
4.0
1.6
16.3
.4
2.2

6.2
10.8
4.2
1.7
17.1
.5
2.5

6.6
10.8
4.4
1.8
16.0
.5
2.6

7.0
11.6
4.6
1.9
16.8
.4
2.6

.3
4.5
3.1
.7
5.9
1.7
4.1
1.3
1.0

.2
3.5
3.3
.5
6.2
1.9
3.8
1.5
1.7

.4
3.6
3.5
.5
6.8
2.0
3.7
1.6
2.1

.3
4.8
3.6
.4
6.9
2.5
3.6
1.7
2.3

.3
4.6
3.8
.4
6.9
2.7
3.1
1.9
2.5

.3
5.0
3.6
.4
7.4
3.0
3.6
2.2
2.7

.7
5.2
3.2
.4
6.6
3.0
3.6
2.2
2.7

.6
5.3
3.1
.5
6.5
3.3
3.4
2.2
2.7

.4
.8
.0
1.0

America

Asia
China

326.6

360.6

.6
4.1
3.0
.5
6.9
2.1
3.7
1.7
1.8"

.4
4.1
2.8
.5
6.5
2.3
3.6
1.9
2.0"

.3
4.1
3.0
.5
6.8
2.3
3.7
1.7
2.0"

.4
.8
.0
.8

.4
.7
.0
.8

.4
.7
.0
.8

.4
.7
.0
.7

.3
.7
.0
.7

.5
.7
.0
.6

.3
.6
.0
.9

.2
.6
.0
1.0

.2
.5
.0
1.0
2.9"
1.7
.6
.7

43

Korea (South)

46
47

Thailand
Other Asia 3

48

Africa
Egypt

51

Other Africa 3

.4
.9
.0
1.0

Other

3.5
.7
1.6
1.3

2.3
.2
1.2
.9

2.1
.3
1.0
.8

2.1
.4
1.0
.7

1.8
.4
.8
.7

2.4
.9
.9
.7

2.9
1.4
.8
.6

3.0
1.7
.7
.6

3.1
1.8
.7
.7

3.1
1.9
.6
.6

Other

38.4 r
5.5
1.7
9.0
2.3
1.4
.1
11.3"
7.0
.0

44.7"
2.9"
4.4
11.7"
7.9
1.4
.1
9.7"
6.6
.0

51.9"
8.3
4.4
14.1
1.1
1.5
.1
13.5"
8.9
.0

50.2"
6.8
4.2
14.9
1.4
1.3
.1
14.3"
7.2
.0

54.6"
6.7
7.1
13.8
3.9
1.3
.1
14.0"
7.7
.0

54.2"
11.9
2.3
15.8
1.2
1.4"
.1
14.4"
7.1
.0

60.9"
14.5"
3.9
17.4
1.0
1.4"
.1
14.0"
8.5
.0

59.4
12.2
5.1
18.1
.8
1.7
.1
15.0
6.4
.0

52.3
8.1
3.8
15.7
.7
1.8
.1
15.2
6.8
.0

55.0"
5.6
6.2
19.9"
1.1
1.7
.1
13.8
6.5
.0

57.5
8.3
4.1
16.4
1.6
1.9
.1
16.7
8.4
.0

30.5"

39.9"

36.4

40.0"

44.4"

48.0"

47.8"

48.6

36.8

41.0

39.3

55

65

1. The banking offices covered by these data are the U.S. offices and foreign
branches of U.S.-owned banks and of U.S. subsidiaries of foreign-owned banks.
Offices not covered include (1) U.S. agencies and branches of foreign banks, and
(2) foreign subsidiaries of U.S. banks. To minimize duplication, the data are
adjusted to exclude the claims on foreign branches held by a U.S. office or another
foreign branch of the same banking institution. The data in this table combine
foreign branch claims in table 3.14 (the sum of lines 7 through 10) with the claims
of U.S. offices in table 3.18 (excluding those held by agencies and branches of
foreign banks and those constituting claims on own foreign branches).
Since June 1984, reported claims held by foreign branches have been reduced
by an increase in the reporting threshold for "shell" branches from $50 million to




$150 million equivalent in total assets, the threshold now applicable to all
reporting branches.
2. Organization of Petroleum Exporting Countries, shown individually; other
members of OPEC (Algeria, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar,
Saudi Arabia, and United Arab Emirates); and Bahrain and Oman (not formally
members of OPEC).
3. Excludes Liberia.
4. Includes Canal Zone.
5. Foreign branch claims only.
6. Includes New Zealand, Liberia, and international and regional
organizations.

Nonbank-Reported

Data

A63

3.22 LIABILITIES TO UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in
the United States1
Millions of dollars, end of period

1989

1990

1993

1992

1991
Type of liability and area or country

1991r
Dec.

Mar.

June

Sept.

Dec.

Mar.P

1

38,764

46,043

43,453

43,453'

44,193'

44,109'

45,184'

43,144'

43,146

? Payable in dollars
3 Payable in foreign currencies

33,973
4,791

40,786
5,257

38,061
5,392

38,061 r
5,392

38,735 r
5,458

37,616'
6,493'

36,792'
8,392'

35,739'
7,405

35,251
7,895

By type
4 Financial liabilities
5
Payable in dollars
6
Payable in foreign currencies

17,879
14,035
3,844

21,066
16,979
4,087

21,872
17,760
4,112

21,872 r
17,76c
4,112

22,185'
17,957'
4,228

21,756'
16,714'
5,042'

23,281'
16,546'
6,735'

22,047'
15,700'
6,347

22,290
15,760
6,530

7 Commercial liabilities
8
Trade payables
9
Advance receipts and other liabilities

20,885
8,070
12,815

24,977
10,683
14,294

21,581
8,662
12,919

21,581 r
8,662 r
12.9191

22,008'
9,125'
12,883'

22,353'
9,715'
12,638'

21,903'
9,586'
12,317'

21,097
9,046'
12,051'

20,856
9,437
11,419

19,938
947

23,807
1,170

20,301
1,280

20,301 r
1,280

20,778'
1,230

20,902'
1,451

20,246'
1,657'

20,039'
1,058

19,491
1,365

11,660
340
258
464
941
541
8,818

10,978
394
975
621
1,081
545
6,357

11,805
217
2,106
682
1,056
408
6,329

11,805r
217
2,106
682
1,056
408
6,329 r

12,349'
174
1,997
666
1,025
355
7,238'

12,728'
194
2,324
634'
979
490
7,244'

13,767'
256
2,785
738'
980
627
7,580'

12,53c
434'
1,608
740
606
569
7,910'

12,694
299
1,610
751
639
503
8,331

610

229

267

267

10
11

1?
n
14
15
16
17
18
19
70
?1
??
73
74
7,5
26
77
78
29

Payable in dollars
Payable in foreign currencies
By area or country
Financial liabilities
Europe
Belgium and Luxembourg
Germany
Netherlands
Switzerland
United Kingdom
Canada
Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela
Japan
Middle East oil-exporting countries

30
31

Africa
Oil-exporting countries 3

32

Mother4

Commercial liabilities
33
Europe
34
Belgium and Luxembourg
35
36
Germany
Netherlands
37
38
39
United Kingdom
40
41
4?
43
44
45
46
47

Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Venezuela

48
49
50

Middle Eastern oil-exporting countries '

51
52

Oil-exporting countries 3

53

2 3

Other 4

283

337

320

491

551

1,357
157
17
0
724
6
0

4,153
371
0
0
3,160
5
4

4,404
537
114
6
3,144
7
4

4,404
537
114
6
3,144'
7
4

4,092'
3%
114
8
2,96C
7
4

3,373'
343
114
10
2,232'
8
4

3,462'
220
115
18
2,408'
12
5

3,515'
349
114
19
2,342'
12
6

3,544
594
114
18
2,142
13
5

4,151
3,299
2

5,295
4,065
5

5,338
4,102
13

5,338
4,102
13

5,366
4,107
13

5,229'
4,136'
10

5,642'
4,609'
17

5,477'
4,451
19

5,451
4,479
24

2
0

2
0

6
4

6
4

7
6

0
0

5
0

6
0

6
0

100

409

52

52

88

89

85

28

44

9,071
175
877
1,392
710
693
2,620

10,310
275
1,218
1,270
844
775
2,792

8,126
248
957
944
709
575
2,310

8,126 r
248
957r
944
709
575r
2,310

7,666'
256
678
880
574
543'
2,445

7,309 r
240
659
702
605
461'
2,404

6,879 r
173
688
744
601
430'
2,262

6,704'
287
663
621'
556
398
2,250

6,471
143
653
613
666
504
2,041

892'

915

1,586
6
293
203
57
444
130

1,548
18
437
107
87
343
158

10,787'
3,994
1,792'

10,695
4,006
1,589

1,124

1,261

990

990

1,095

1,077

1,085

1,224
41
308
100
27
323
164

1,672
12
538
145
30
475
130

1,352
3
310
219
107
304
94

1,352
3
310
219
107
304
94

1,701
13
493
230
108
375
168

1,803
8
409
212
73
475
279

1,4%'
3
338
115
85
322
125'

7,550
2,914
1,632

9,483
3,651
2,016

9,330
3,720
1,498

9,330
3,720
1,498

9,890
3,549
1,591

10,439
3,537
1,778

11,006
3,909
1,813

886
339

844
422

713
327

713
327

644
253

775
389

675
335'

556
295

559
224

1,030

1,406

1,070

1,070

1,012

950

762

572

668

1. F o r a description of the changes in the international statistics tables, see
Federal Reserve Bulletin, vol. 65, (July 1979), p. 550.
2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).




r

3. Comprises Algeria, Gabon, Libya, and Nigeria.
4. Includes nonmonetary international and regional organizations.
5. Revisions include a reclassification of transactions, which also affects the
totals for Asia and the grand totals.

A64

International Statistics • September 1993

3.23 CLAIMS ON UNAFFILIATED FOREIGNERS
the United States1

Reported by Nonbanking Business Enterprises in

Millions of dollars, end of period
1991r
Type, and area or country

1989

1990

1992r

1993

1991
Dec.

Mar.

June

Sept.

Dec.

Mar.P

1 Total

33,173

35,348

42,233

42,233

40,899

41,037

38,345

38,039

40,567

2 Payable in dollars
3 Payable in foreign currencies

30,773
2,400

32,760
2,589

39,688
2,545

39,688
2,545

38,281
2,618

38,071
2,966

35,460
2,885

35,562
2,477

37,884
2,683

By type
4 Financial claims
5
Deposits
6
Payable in dollars
1
Payable in foreign currencies
Other financial claims
8
9
Payable in dollars
10
Payable in foreign currencies

19,297
12,353
11,364
989
6,944
6,190
754

19,874
13,577
12,552
1,025
6,297
5,280
1,017

25,264
17,290
16,415
875
7,974
7,094
880

25,264
17,290
16,415
875
7,974
7,094
880

24,289
16,262
15,076
1,186
8,027
7,305
722

24,037
15,056
13,717
1,339
8,981
8,277
704

21,311
12,436
11,353
1,083
8,875
7,868
1,007

21,041
12,615
11,826
789
8,426
7,688
738

22,046
12,774
11,720
1,054
9,272
8,546
726

11 Commercial claims
12
Trade receivables
13
Advance payments and other claims

13,876
12,253
1,624

15,475
13,657
1,817

16,969
14,244
2,725

16,969
14,244
2,725

16,610
14,044
2,566

17,000
14,538
2,462

17,034
14,330
2,704

16,998
14,711
2,287

18,521
16,457
2,064

14
15

13,219
657

14,927
548

16,179
790

16,179
790

15,900
710

16,077
923

16,239
795

16,048
950

17,618
903

8,463
28
153
152
238
153
7,496

9,645
76
371
367
265
357
7,971

13,724
13
314
335
385
591
11,445

13,724
13
314
335
385
591
11,445

14,243
12
279
285
727
682
11,669

13,225
25
788
377
732
780
8,789

11,433
16
811
319
767
602
7,915

9,514
8
776
399
537
507
6,130

10,295
5
909
437
581
493
6,838

16
17
18
19
20
21
22

Payable in dollars
Payable in foreign currencies
By area or country
Financial claims
Europe
Belgium and Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom

23

Canada

1,904

2,934

2,716

2,716

2,753

2,533

2,245

1,721

2,086

24
25
26
27
28
29
30

Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela

8,020
1,890
7
224
5,486
94
20

6,201
1,090
3
68
4,635
177
25

7,689
758
8
144
6,304
212
40

7,689
758
8
144
6,304
212
40

6,200
493
12
143
5,124
212
34

6,849
523
12
134
5,759
244
32

6,452
1,099
65
396
4,449
239
26

8,326
618
40
4%
6,530
286
29

5,647
302
79
592
4,213
235
23

31
32
33

Asia
Japan
Middle East oil-exporting countries 2

590
213
8

860
523
8

675
385
5

675
385
5

642
380
3

975
728
4

727
481
4

846
683
3

3,263
3,066
8

34
35

Africa
Oil-exporting countries 3

140
12

37
0

57
1

57
1

60
0

57
0

71
1

79
9

128
1

180

195

403

403

391

398

383

555

627

6,209
242
964
696
479
313
1,575

7,044
212
1,240
807
555
301
1,775

7,935
192
1,542
940
643
295
2,084

7,935
192
1,542
940
643
295
2,084

7,842
181
1,560
933
646
323
2,082

8,087
255
1,561
905
666
394
2,169

7,742
172
1,739
870
588
294
1,973

7,442
184
1,392
880
541
260
1,799

8,065
166
1,385
916
714
414
2,171

36
37
38
39
40
41
42
43

All other

4

Commercial claims
Europe
Belgium and Luxembourg
France
Germany
Netherlands
Switzerland
United Kingdom

44

Canada

1,091

1,074

1,109

1,109

1,115

1,058

1,105

1,192

1,137

45
46
47
48
49
50
51

Latin America and Caribbean
Bahamas
Bermuda
Brazil
British West Indies
Mexico
Venezuela

2,184
58
323
297
36
508
147

2,375
14
246
326
40
661
192

2,562
11
263
418
41
801
202

2,562
11
263
418
41
801
202

2,544
11
272
364
45
865
206

2,653
9
291
438
32
829
251

3,113
7
245
395
43
942
302

2,827
18
237
336
39
837
317

3,255
8
194
809
17
898
320

52
53
54

Asia
Japan
Middle Eastern oil-exporting countries 2

3,570
1,199
518

4,127
1,460
460

4,558
1,878
621

4,558
1,878
621

4,343
1,782
635

4,456
1,786
609

4,300
1,793
511

4,649
1,850
677

5,248
2,129
764

55
56

Africa
Oil-exporting countries 3

429
108

48$
67

418
95

418
95

418
75

422
73

430
60

540
78

446
75

57

Other 4

393

367

387

387

348

324

344

348

370

1. For a description of the changes in the international statistics tables, see
Federal Reserve Bulletin, vol. 65, (July 1979), p. 550.
2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States).




3. Comprises Algeria, Gabon, Libya, and Nigeria.
4. Includes nonmonetary international and regional organizations.

Securities Holdings and Transactions

A65

3.24 FOREIGN TRANSACTIONS IN SECURITIES
Millions of dollars
1992r

1993
Transaction and area or country

1991

1992

1993

r

Jan.May

Nov.

Dec.

Jan. r

Feb. r

Mar. r

Apr/

May p

28,753
25,980

27,013
24,548

25,009
25,329

23,021
22,223

U.S. corporate securities
STOCKS

211,207
200,116

1 Foreign purchases
2 Foreign sales

221,307
226,428

122,966
117,433

17,708
16,426

22,725
20,382

19,170
19,353

3 Net purchases or sales (—)

11,091

-5,121

5,533

1,282

2,343

-183

2,773

2,465

-320

798

4 Foreign countries

10,522

-5,154

5,287

1,279

2,319

-178

2,683

2,308

-328

802

53
9
-63
-227
-131
-352
3,845
2,177
-134
4,255
1,179
153
174

-4,912
-1,350
-65
-262
168
-3,301
1,407
2,203
-88
-3,943
-3,598
10
169

2,022
-225
440
187
1,388
-559
-124
1,236
-105
2,147
-422
-5
116

368
-54
46
-5
-39
361
42
647
-219
374
220
-18
85

1,505
-154
162
190
221
705
176
422
70
122
215
-7
31

52
-25
91
64
205
-350
-341
305
-92
-123
28
17

2,271
223
97
-11
501
1,135
57
-235
-65
593
-624
27
35

975
-183
103
68
356
476
176
410
-13
763
250
2
-5

-645
-154
144
32
277
-1,134
103
241
7
1
-531
-48
13

-631
-86
5
34
49
-686
-119
515
58
913
455
10
56

568

33

246

3

24

-5

90

157

8

-4

153,096
125,637

215,041
175,560

104,652
89,117

18,083
16,318

19,264
15,391

17,220
15,454

21,934
18,8%

25,223
23,275

20,728
16,233

19,547
15,259

21 Net purchases or sales ( - )

27,459

39,481

15,535

1,765

3,873

1,766

3,038

1,948

4,495

4,288

22 Foreign countries

27,590

38,365

15,948

1,600

3,328

1,862

3,164

2,084

4,536

4,302

23
24
25
26
27
28
29
30
31
32
33
34
35

13,112
847
1,577
482
656
8,931
1,623
2,672
1,787
8,459
5,767
52
-116

17,836
1,203
2,486
540
-579
12,836
237
9,300
3,166
7,545
-450
354
-73

5,156
1,590
1,127
-329
-355
3,011
159
3,285
1,389
5,814
2,777
206
-61

-494
-7
-113
144
-261
-313
281
542
515
692
266
68

2,118
217
857
48
105
962
-38
513
360
119
9
302
-46

1,090
101
91
-119
122
334
-437
419
300
305
190
168
17

2,143
311
52
-133
-38
2,376
145
482
248
149
61
27
-30

27
75
-57
-178
11
-229
138
490
263
1,216
595
-10
-40

1,079
508
811
108
-239
394
291
632
463
2,082
991
0
-11

817
595
230
-7
-211
136
22
1,262
115
2,062
940
21
3

-131

1,116

-413

165

545

-96

-126

-136

-41

-14

-1,571
15,055
16,626
-9,528
56,046
65,574

-4,565
17,447
22,012
-4,629
70,126
74,755

-4,006
19,291
23,297
-810
55,752
56,562

-3,745
16,395
20,140
-26
59,443
59,469

5
6
7
8
9
10
11
12
13
14
15
16
17

Europe
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
Latin America and Caribbean
Middle East 1
Other Asia
Japan
Africa
Other countries

18 Nonmonetary international and
regional organizations

4

BONDS2

19 Foreign purchases
20 Foreign sales

Europe
France
Germany
Netherlands
Switzerland
United Kingdom
Canada
Latin America and Caribbean
Middle East 1
Other Asia
Japan
Africa
Other countries

36 Nonmonetary international and
regional organizations

- 4

Foreign securities
37 Stocks, net purchases or sales ( - ) 3
38
Foreign purchases
39
Foreign sales 3
40 Bonds, net purchases or sales ( - )
41
Foreign purchases
42
Foreign sales

-31,967
120,598
152,565
-14,828
330,311
345,139

-32,268
150,022
182,290
-18,277
486,238
504,515

-16,238
80,920
97,158
-20,100
279,912
300,012

-3,704
11,673
15,377
-715
52,281
52,996

-4,376
12,782
17,158
-2,866
39,617
42,483

-2,351
12,732
15,083
-5,107
38,545
43,652

43 Net purchases or sales ( - ) , of stocks and bonds

-46,795

-50,545

-36,338

-4,419

-7,242

-7,458

-11,099

-9,194

-4,816

-3,771

44 Foreign countries

-46,711

-53,881

-35,812

-4,492

-7,1%

-6,451

-11,237

-8,925

-5,088

-4,111

45
46
47
48
49
50

-34,452
-7,004
759
-7,350
-9
1,345

-37,557
-6,635
-2,298
-6,629
-2
-760

-23,875
-9,020
507
-3,043
-226
-155

-4,958
575
-1,672
1,529
42
-8

-4,507
-1,167
511
-1,678
-11
-344

-6,486
-161
195
-394
-7
402

-6,669
-5,028
25
539
3
-107

-3,084
-3,034
68
-2,477
-18
-380

-2,773
-816
-904
-528
-18
-49

-4,863
19
1,123
-183
-186
-21

-84

3,336

-526

73

-46

-1,007

138

-269

272

340

Europe
Canada
Latin America and Caribbean
Asia
Africa
Other countries

51 Nonmonetary international and
regional organizations

1. Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, Kuwait,
Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial States).
2. Includes state and local government securities and securities of U.S.
government agencies and corporations. Also includes issues of new debt securities sold abroad by U.S. corporations organized to finance direct investments
abroad.




3. In a July 1989 merger, the former stockholders of a U . S . company received
$5,453 million in shares of the new combined U . K . company. This transaction is
not reflected in the data.

A66

International Statistics • September 1993

3.25 MARKETABLE U.S. TREASURY BONDS AND NOTES

Foreign Transactions

Millions of dollars
1993
Country or area

1991

1993

1992

1992
Jan.May

Nov.

Dec. r

Jan/

Feb/

Mar/

Apr/

May"

Transactions, net purchases or sales ( - ) during period 1
19,865

39,288r

19,687

37,935r

3 Europe
4
Belgium and Luxembourg
5
Germany
6
Netherlands
7
Sweden
8
Switzerland
9
United Kingdom
10
Other Western Europe
Eastern Europe
11
12 Canada

8,663
523
-4,725
-3,735
-663
1,007
6,218
10,024
13
-3,019

r

19,625
1,985
2,076
—2,959"
-804
488 r
24,184
-5,995 r
650
562

-3,056
798
-8,470
251
213
-2,835
8,546
-2,028
469
7,783

13 Latin America and Caribbean
14
Venezuela
Other Latin America and Caribbean
15
16
Netherlands Antilles
17
18
Japan
19
20

10,285
10
4,179
6,097
3,367
-4,081
689
-298

-3,222 r
539
-l,956r
-1,805
23,517r
9,817
1,103
-3,650"

1 Estimated total
2 Foreign countries

21 Nonmonetary international and regional organizations
22
International
Latin American regional
23

Oil-exporting countries
27 Middle E a s t 2
28

439

-1,273

6,129

4,369

-853

17,644"

-144

-2,166

5,577

4,513

-589

7,267"
370
-1,584
1,827
668
1,334
7,209
-2,775"
218
-1,087

3,173
-28
898
-804
-344
213
2,833
405
0
-99

-600
-59
697
-1,238
-54
-199
2,025
-1,774
2
3,302

-382
45
-1,632
206
258
-455
183
975
38
82

-3,826
622
-2,757
66
-540
-1,569
672
-509
189
2,490

1,615
-345
-1,382
731
-100
-721
2,662
631
139
1,386

137
535
-3,396
486
649
109
3,004
-1,351
101
523

-7,489
384
-6,205
-1,668
11,839
10,177
-173
-1,713

7,270
27
2,385
4,858
4,000
3,383
119
75

-4,519
11
415
-4,945
1,184
2,201
0
73

-1,495
-175
-3,309
1,989
-1,136
-743
-33
-182

445
179
-1,656
1,922
-1,032
804
-139
-1,140

-537
154
-471
-220
7,215
3,457
-66
301

-2,015
74
1,101
-3,190
3,831
3,348
67
-371

-3,887
152
-1,870
-2,169
2,961
3,311
-2
-321

1,620
354
505

-13
-38
-31

202
76
97

583
228
270

893
581
235

552
56
1

-144
-211
16

-264
-300
-17

-188
-715
527

-144
-2,980
2,836

-2,166
-4,364
2,198

5,577
-657
6,234

4,513
2,586
1,927

-589
-3,287
2,698

505
0

-238
8

-1,855
0

811
0

100
-6

-1,128
0

7,191

1,353
1,018
533

19,687
1,190
18,496

37,935r
6,876
31,059"

7,191
-8,702
15,893

-6,822
239

4,317"
11

-2,310
2

1. Official and private transactions in marketable U.S. Treasury securities
having an original maturity of more than one year. Data are based on monthly
transactions reports. Excludes nonmarketable U.S. Treasury bonds and notes
held by official institutions of foreign countries.




14
-188

178
-358
-72

MEMO

24 Foreign countries
Official institutions
25
Other foreign 2
26

17,631"

8,811

17,644"
-620"
18,264
407
0

2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and
United Arab Emirates (Trucial States),
3. Comprises Algeria, Gabon, Libya, and Nigeria,

Interest and Exchange Rates

A67

3.26 DISCOUNT RATES OF FOREIGN CENTRAL BANKS 1
Percent per year
Rate on July 31, 1993

Rate on July 31, 1993

Country

Rate on July 31, 1993

Country
Percent

6.25
6.0
4.41
9.25

Austria..
Belgium .
Canada..
Denmark
France . .

10.0

Country

Month
effective
July
July
July
July
July

1993
1993
1993
1993
1993

Percent

Germany...
Italy
Japan
Netherlands

6.75
9.0
2.5
6.0

1. Rates shown are mainly those at which the central bank either discounts or
makes advances against eligible commercial paper or government securities for
commercial banks or brokers. For countries with more than one rate applicable to
such discounts or advances, the rate shown is the one at which it is understood
that the central bank transacts the largest proportion of its credit operations.

Month
effective
July
July
July
July

1993
1993
1992
1993

Norway
Switzerland
United Kingdom

Percent

Month
effective

7.5
4.5
12.0

July 1993
July 1993
Sept. 1992

2. Since February 1981, the rate has been that at which the Bank of France
discounts Treasury bills for seven to ten days.

3.27 FOREIGN SHORT-TERM INTEREST RATES1
Percent per year, averages of daily figures
1993
Type or country

8 Italy

1990

8.16
14.73
13.00
8.41
8.71
8.57
10.20
12.11
9.70
7.75

1991

5.86
11.47
9.07
9.15
8.01
9.19
9.49
12.04
9.30
7.33

1992

3.70
9.56
6.76
9.42
7.67
9.25
10.14
13.91
9.31
4.39

1. Rates are for three-month interbank loans, with the following exceptions:
Canada, finance company paper; Belgium, three-month Treasury bills; and Japan,
CD rate.




Jan.

Feb.

Mar.

Apr.

May

June

July

3.22
6.88
7.03
8.50
5.52
8.00
11.69
12.56
8.19
3.70

3.12
6.10
6.38
8.29
5.34
7.98
11.70
11.43
8.75
3.27

3.11
5.91
5.59
7.85
5.05
7.47
10.89
11.26
8.27
3.26

3.10
5.90
5.43
7.81
4.97
7.43
8.73
11.41
7.94
3.22

3.12
5.91
5.29
7.41
4.97
6.98
7.48
10.74
7.16
3.24

3.21
5.83
4.91
7.51
4.99
6.64
7.19
10.18
6.87
3.23

3.17
5.88
4.48
7.12
4.62
6.45
7.72
9.42
7.12
3.22

A68

International Statistics • September 1993

3.28 FOREIGN EXCHANGE RATES1
Currency units per dollar except as noted

Country/currency unit

1
2
3
4
5
6
7
8
9
10

Australia/dollar^
Austria/schilling
Belgium/franc
Canada/dollar
China, P.R./yuan
Denmark/krone
Finland/markka
France/franc
Germany/deutsche mark.
Greece/drachma

11
12
13
14
15
16
17
18
19
20

Hong Kong/dollar
India/rupee
Ireland/pound 2
Italy/lira
Japan/yen
Malaysia/ringgit
Netherlands/guilder.
New Zealand/dollar 2
Norway/krone
Portugal/escudo

21
22
23
24
25
26
27
28
29
30

Singapore/dollar
South Africa/rand
South Korea/won
Spain/peseta
Sri Lanka/rupee
Sweden/krona
Switzerland/franc
Taiwan/dollar
Thailand/baht
United Kingdom/pound 2

—

1990

1991

1992
Feb.

Mar.

Apr.

68.294
11.556
33.841

71.155
11.234
32.857
1.2621
5.7202
6.1339
5.6190
5.3984
1.5964
217.90

78.069
11.331
33.424
1.1668
4.7921
6.1899
3.8300
5.4467
1.6166
158.59

77.872
11.686
34.195
1.1460
5.3337
6.4038
4.0521
5.6468
1.6610
182.63

73.521
10.992
32.148
1.2085
5.5206
6.0372
4.4865
5.2935
1.5618
190.81

5.7874
6.3019
5.8534
5.5594
1.6414
220.60

70.775
11.586
33.919
1.2471
5.7455
6.3242
5.9767
5.5944
1.6466
223.57

7.7899
17.492
165.76
1,198.27
145.00
2.7057
1.8215
59.619
6.2541
142.70

7.7712
22.712
161.39
1,241.28
134.59
2.7503
1.8720
57.832
6.4912
144.77

7.7402
28.156
170.42
1,232.17
126.78
2.5463
1.7587
53.792
6.2142
135.07

7.7335
30.042
148.11
1,550.43
120.76
2.6295
1.8473
51.603
6.9779
149.89

7.7332
31.939
147.58
1,591.35
117.02
2.6051
1.8507
53.026
6.9989
152.17

7.7306
31.610
152.75
1,536.14
112.41
2.5777
1.7942
53.904
6.7399
148.25

1.8134
2.5885
710.64
101.96
40.078
5.9231
1.3901
26.918
25.609
178.41

1.7283
2.7633
736.73
104.01
41.200
6.0521
1.4356
26.759
25.528
176.74

1.6294
2.8524
784.58
102.38
44.013
5.8258
1.4064
25.160
25.411
176.63

1.6463
3.1313
799.25
117.51
46.351
7.5566
1.5178
25.837
25.508
143.95

1.6446
3.1790
796.42
117.71
47.069
7.7362
1.5206
26.026
25.425
146.17

1.6228
3.1718
798.61
115.64
47.712
7.4500
1.4599
25.987
25.251
154.47

89.09

89.84

86.61

1.2602

July

May
67.492
11.637
34.009
1.2789
5.7504
6.3380
5.5674
5.5700
1.6547
225.45

67.788
12.071
35.483
1.2820
5.7756
6.6531
5.7852
5.8464
1.7157
234.77

7.7290
31.613
151.65
1,475.66
110.34
2.5661
1.8026
54.290
6.8027
151.89

7.7362
31.668
147.47
1,505.05
107.41
2.5696
1.8559
53.949
6.9986
157.63

7.7556
31.600
140.83
1,586.02
107.69
2.5672
1.9299
54.900
7.3179
167.87

1.6136
3.1787
803.19
121.30
47.965
7.3271
1.4504
25.978
25.234
154.77

1.6175
3.2408
805.91
127.11
48.073
7.4541
1.4769
26.267
25.214
150.82

1.6206
3.3518
809.58
134.93
48.643
7.9802
1.5147
26.682
25.331
149.55

91.81

94.59

69.859
11.305
33.044
1.2698
5.7392
6.1751
5.4847
5.4180
1.6071
218.12

MEMO

31 United States/dollar 3

1. Averages of certified noon buying rates in New York for cable transfers.
Data in this table also appear in the Board's G.5 (405) monthly statistical release.
For ordering address, see inside front cover.
2. Value in U.S. cents.
3. Index of weighted-average exchange value of U.S. dollar against the
currencies of ten industrial countries. The weight for each of the ten countries is




93.82

90.62

the 1972-76 average world trade of that country divided by the average world
trade of all ten countries combined. Series revised as of August 1978 (see Federal
Reserve Bulletin, vol. 64 (August 1978), p. 700).

A69

Guide to Statistical Releases and Special Tables
STATISTICAL RELEASES—List Published Semiannually, with Latest B U L L E T I N Reference
Anticipated schedule of release dates for periodic releases

Issue
June 1993

Page
A78

SPECIAL TABLES—Quarterly Data Published Irregularly, with Latest B U L L E T I N Reference
Title and Date

Issue

Page

Assets and liabilities of commercial banks
June 30, 1992
September 30, 1992
December 31, 1992
March 31, 1993

November
February
May
August

1992
1993
1993
1993

A70
A70
A70
A70

Terms of lending at commercial banks
August 1992
November 1992
February 1993
May 1993

November
February
May
August

1992
1993
1993
1993

A76
A76
A76
A76

Assets and liabilities of U.S. branches and agencies of foreign banks
June 30, 1992
September 30, 1992
December 31, 1992
March 31, 1993

November
February
May
August

1992
1993
1993
1993

A80
A80
A80
A80

Pro forma balance sheet and income statements for priced service operations
June 30, 1991
September 30,1991
March 30, 1992
June 30, 1992

November
January
August
October

1991
1992
1992
1992

A80
A70
A80
A70

Assets and liabilities of life insurance companies
June 30, 1991
September 30, 1991
December 31, 1991
September 30, 1992

December
May
August
March

1991
1992
1992
1993

A79
A81
A83
A71




A70

Index to Statistical Tables
References are to pages A3-A68 although the prefix "A" is omitted in this index
ACCEPTANCES, bankers (See Bankers acceptances)
Agricultural loans, commercial banks, 22,23
Assets and liabilities (See also Foreigners)
Banks, by classes, 20-23
Domestic finance companies, 36
Federal Reserve Banks, 11
Financial institutions, 28
Foreign banks, U.S. branches and agencies, 24
Automobiles
Consumer installment credit, 39
Production, 47,48
BANKERS acceptances, 10, 23, 26
Bankers balances, 20-23. (See also Foreigners)
Bonds (See also U.S. government securities)
New issues, 35
Rates, 26
Branch banks, 24, 55
Business activity, nonfinancial, 45
Business expenditures on new plant and equipment, 35
Business loans (See Commercial and industrial loans)
CAPACITY utilization, 46
Capital accounts
Banks, by classes, 20
Federal Reserve Banks, 11
Central banks, discount rates, 67
Certificates of deposit, 26
Commercial and industrial loans
Commercial banks, 18, 22
Weekly reporting banks, 22-24
Commercial banks
Assets and liabilities, 20-23
Commercial and industrial loans, 18, 20, 21, 22, 23, 24
Consumer loans held, by type and terms, 39
Deposit interest rates of insured, 16
Loans sold outright, 22
Nondeposit funds, 19
Real estate mortgages held, by holder and property, 38
Time and savings deposits, 4
Commercial paper, 25, 26, 36
Condition statements (See Assets and liabilities)
Construction, 45, 49
Consumer installment credit, 39
Consumer prices, 45,46
Consumption expenditures, 52, 53
Corporations
Nonfinancial, assets and liabilities, 35
Profits and their distribution, 35
Security issues, 34, 65
Cost of living (See Consumer prices)
Credit unions, 39
Currency in circulation, 5, 14
Customer credit, stock market, 27
DEBITS to deposit accounts, 17
Debt (See specific types of debt or securities)
Demand deposits
Banks, by classes, 20-24




Demand deposits—continued
Ownership by individuals, partnerships, and
corporations, 24
Turnover, 17
Depository institutions
Reserve requirements, 9
Reserves and related items, 4, 5, 6, 13
Deposits (See also specific types)
Banks, by classes, 4, 20-23, 24
Federal Reserve Banks, 5, 11
Interest rates, 16
Turnover, 17
Discount rates at Reserve Banks and at foreign central banks and
foreign countries (See Interest rates)
Discounts and advances by Reserve Banks (See Loans)
Dividends, corporate, 35
EMPLOYMENT, 45
Eurodollars, 26
FARM mortgage loans, 38
Federal agency obligations, 5, 10, 11, 12, 31, 32
Federal credit agencies, 33
Federal finance
Debt subject to statutory limitation, and types and ownership
of gross debt, 30
Receipts and outlays, 28, 29
Treasuryfinancingof surplus, or deficit, 28
Treasury operating balance, 28
Federal Financing Bank, 28, 33
Federal funds, 7, 19, 22, 23, 24, 26, 28
Federal Home Loan Banks, 33
Federal Home Loan Mortgage Corporation, 33, 37, 38
Federal Housing Administration, 33, 37, 38
Federal Land Banks, 38
Federal National Mortgage Association, 33, 37, 38
Federal Reserve Banks
Condition statement, 11
Discount rates (See Interest rates)
U.S. government securities held, 5, 11, 12, 30
Federal Reserve credit, 5, 6, 11, 12
Federal Reserve notes, 11
Federally sponsored credit agencies, 33
Finance companies
Assets and liabilities, 36
Business credit, 36
Loans, 39
Paper, 25, 26
Financial institutions, loans to, 22, 23, 24
Float, 51
Flow of funds, 40, 42, 43, 44
Foreign banks, assets and liabilities of U.S. branches and
agencies, 23, 24
Foreign currency operations, 11
Foreign deposits in U.S. banks, 5, 11, 22, 23
Foreign exchange rates, 68
Foreign trade, 54
Foreigners
Claims on, 55, 57, 60, 61, 62, 64
Liabilities to, 23, 54, 55, 57, 58, 63, 65, 66

A71

GOLD
Certificate account, 11
Stock, 5, 54
Government National Mortgage Association, 33, 37, 38
Gross domestic product, 51
HOUSING, new and existing units, 49
INCOME, personal and national, 45, 51, 52
Industrial production, 45, 47
Installment loans, 39
Insurance companies, 30, 38
Interest rates
Bonds, 26
Consumer installment credit, 39
Deposits, 16
Federal Reserve Banks, 8
Foreign central banks and foreign countries, 67
Money and capital markets, 26
Mortgages, 37
Prime rate, 25
International capital transactions of United States, 53-67
International organizations, 57, 58, 60, 63, 64
Inventories, 51
Investment companies, issues and assets, 35
Investments (See also specific types)
Banks, by classes, 20, 21, 22, 23, 24
Commercial banks, 4, 18, 20-23
Federal Reserve Banks, 11, 12
Financial institutions, 38
LABOR force, 45
Life insurance companies (See Insurance companies)
Loans (See also specific types)
Banks, by classes, 20-23
Commercial banks, 4, 18, 20-23
Federal Reserve Banks, 5, 6, 8, 11, 12
Financial institutions, 38
Insured or guaranteed by United States, 37, 38
MANUFACTURING
Capacity utilization, 46
Production, 46, 48
Margin requirements, 27
Member banks (See also Depository institutions)
Federal funds and repurchase agreements, 7
Reserve requirements, 9
Mining production, 48
Mobile homes shipped, 49
Monetary and credit aggregates, 4,13
Money and capital market rates, 26
Money stock measures and components, 4, 14
Mortgages (See Real estate loans)
Mutual funds, 35
Mutual savings banks (See Thrift institutions)
NATIONAL defense outlays, 29
National income, 51
OPEN market transactions, 10
PERSONAL income, 52
Prices
Consumer and producer, 45, 50
Stock market, 27
Prime rate, 25
Producer prices, 45, 50
Production, 45,47
Profits, corporate, 35




REAL estate loans
Banks, by classes, 18, 22, 23, 38
Terms, yields, and activity, 37
Type of holder and property mortgaged, 38
Repurchase agreements, 7, 19, 22, 23, 24
Reserve requirements, 9
Reserves
Commercial banks, 20
Depository institutions, 4, 5, 6, 13
Federal Reserve Banks, 11
U.S. reserve assets, 54
Residential mortgage loans, 37
Retail credit and retail sales, 39,40,45
SAVING
Flow of funds, 40,42,43, 44
National income accounts, 51
Savings and loan associations, 38, 39,40. (See also SAIF-insured
institutions)
Savings banks, 38, 39
Savings deposits (See Time and savings deposits)
Securities (See also specific types)
Federal and federally sponsored credit agencies, 33
Foreign transactions, 65
New issues, 34
Prices, 27
Special drawing rights, 5,11, 53, 54
State and local governments
Deposits, 22, 23
Holdings of U.S. government securities, 30
New security issues, 34
Ownership of securities issued by, 22, 23
Rates on securities, 26
Stock market, selected statistics, 27
Stocks (See also Securities)
New issues, 34
Prices, 27
Student Loan Marketing Association, 33
TAX receipts, federal, 29
Thrift institutions, 4. (See also Credit unions and Savings and
loan associations)
Time and savings deposits, 4, 14, 16, 19, 20, 21, 22, 23, 24
Trade, foreign, 54
Treasury cash, Treasury currency, 5
Treasury deposits, 5, 11, 28
Treasury operating balance, 28
UNEMPLOYMENT, 45
U.S. government balances
Commercial bank holdings, 20, 21, 22, 23
Treasury deposits at Reserve Banks, 5, 11, 28
U.S. government securities
Bank holdings, 20-23, 24, 30
Dealer transactions, positions, and financing, 32
Federal Reserve Bank holdings, 5, 11,12, 30
Foreign and international holdings and
transactions, 11, 30, 66
Open market transactions, 10
Outstanding, by type and holder, 28, 30
Rates, 25
U.S. international transactions, 53-67
Utilities, production, 48
VETERANS Administration, 37, 38
WEEKLY reporting banks, 22-24
Wholesale (producer) prices, 45, 50
YIELDS (See Interest rates)

A72

Federal Reserve Board of Governors
and Official Staff
ALAN GREENSPAN, Chairman
DAVID W . MULLINS, JR., Vice Chairman

WAYNE D . ANGELL
EDWARD W . KELLEY, JR.

OFFICE OF BOARD MEMBERS
JOSEPH R. COYNE, Assistant to the Board
DONALD J. WINN, Assistant to the Board
THEODORE E. ALLISON, Assistant to the Board for

Federal

Reserve System Affairs
LYNN S. FOX, Special Assistant to the Board
WINTHROP P. HAMBLEY, Special Assistant to the Board
BOB STAHLY MOORE, Special Assistant to the Board
DIANE E. WERNEKE, Special Assistant to the Board

DIVISION OF INTERNATIONAL FINANCE
EDWIN M . TRUMAN, Staff Director
LARRY J. PROMISEL, Senior Associate Director
CHARLES J. SIEGMAN, Senior Associate Director
D A L E W . HENDERSON, Associate Director
DAVID H . HOWARD, Senior Adviser
DONALD B . ADAMS, Assistant Director
PETER HOOPER H I , Assistant Director
KAREN H . JOHNSON, Assistant Director
RALPH W . SMITH, JR., Assistant Director

LEGAL DIVISION
J. VIRGIL MATTINGLY, JR., General
Counsel
SCOTT G. ALVAREZ, Associate General Counsel
RICHARD M. ASHTON, Associate General Counsel
OLIVER IRELAND, Associate General Counsel
KATHLEEN M. O'DAY, Associate General Counsel
MARYELLEN A. BROWN, Assistant to the General Counsel

DIVISION

OF RESEARCH AND STATISTICS
Director
EDWARD C . ETTIN, Deputy Director
WILLIAM R . JONES, Associate Director
THOMAS D . SIMPSON, Associate Director

MICHAEL J. PRELL,

LAWRENCE SLIFMAN, Associate

Director

Associate Director
MARTHA BETHEA, Deputy Associate Director
PETER A . TINSLEY, Deputy Associate Director
MYRON L . KWAST, Assistant Director
PATRICK M . PARKINSON, Assistant Director
MARTHA S . SCANLON, Assistant Director
JOYCE K . ZICKLER, Assistant Director
DAVID J. STOCKTON,

OFFICE OF THE SECRETARY
WILLIAM W. WILES,

Secretary
JENNIFER J. JOHNSON, Associate
Secretary
BARBARA R. LOWREY, Associate
Secretary
ELLEN MALAND, Assistant
Secretary

DIVISION OF BANKING
SUPERVISION AND REGULATION
RICHARD SPILLENKOTHEN, Director
STEPHEN C . SCHEMERING, Deputy Director
D O N E . KLINE, Associate Director
WILLIAM A . RYBACK, Associate Director
FREDERICK M . STRUBLE, Associate Director
HERBERT A . BIERN, Deputy Associate Director
ROGER T. COLE, Deputy Associate Director
JAMES I. GARNER, Deputy Associate Director
HOWARD A . AMER, Assistant Director
GERALD A . EDWARDS, JR., Assistant Director
JAMES D . GOETZINGER, Assistant Director
STEPHEN M . HOFFMAN, JR., Assistant Director
LAURA M . HOMER, Assistant Director
JAMES V . HOUPT, Assistant Director
JACK P. JENNINGS, Assistant Director
MICHAEL G . MARTINSON, Assistant Director
RHOGER H PUGH, Assistant Director
SIDNEY M . SUSSAN, Assistant Director
MOLLY S . WASSOM, Assistant Director




JOHN J. MINGO,

Adviser

LEVON H . GARABEDIAN,

Assistant Director

(Administration)
DIVISION

OF MONETARY
AFFAIRS
Director
DAVID E . LINDSEY, Deputy Director
BRIAN F. MADIGAN, Associate Director
RICHARD D . PORTER, Deputy Associate Director
DEBORAH DANKER, Assistant Director
DONALD L . KOHN,

NORMAND R . V . BERNARD,

DIVISION

OF

Special Assistant to the Board

CONSUMER

AND COMMUNITY AFFAIRS
GRIFFITH L . GARWOOD, Director
G L E N N E . LONEY, Associate Director
DOLORES S . SMITH, Associate Director
MAUREEN P. ENGLISH, Assistant Director
IRENE SHAWN MCNULTY, Assistant Director

A73

JOHN P. LAWARE
LAWRENCE B . LINDSEY

SUSAN M . PHILLIPS

OFFICE OF
STAFF DIRECTOR FOR MANAGEMENT
S . DAVID FROST, Staff Director
WILLIAM SCHNEIDER, Special Assignment:
Project Director, National Information Center
PORTIA W . THOMPSON, Equal Employment Opportunity
Programs Officer

DIVISION OF RESERVE BANK
OPERATIONS
AND PAYMENT SYSTEMS
CLYDE H . FARNSWORTH, JR., Director
DAVID L . ROBINSON, Deputy Director (Finance and
Control)
CHARLES W . BENNETT, Assistant Director
JACK DENNIS, JR., Assistant Director
EARL G . HAMILTON, Assistant Director
JEFFREY C . MARQUARDT, Assistant Director

DIVISION OF HUMAN
RESOURCES
MANAGEMENT
DAVID L . SHANNON, Director
JOHN R . WEIS, Associate Director
A N T H O N Y V. DIGIOIA, Assistant Director
JOSEPH H . HAYES, JR., Assistant Director
FRED HOROWITZ, Assistant Director
OFFICE OF THE

CONTROLLER
Controller
Assistant Controller (Programs and

GEORGE E . LIVINGSTON,
STEPHEN J. CLARK,

Budgets)
DARRELL R . PAULEY,

Assistant Controller (Finance)

DIVISION

OF SUPPORT SERVICES
Director
GEORGE M . LOPEZ, Assistant Director
DAVID L . WILLIAMS, Assistant Director
ROBERT E . FRAZIER,

DIVISION OF INFORMATION
RESOURCES
MANAGEMENT
STEPHEN R . MALPHRUS, Director
BRUCE M . BEARDSLEY, Deputy Director
MARIANNE M. EMERSON, Assistant

Po

Director

Assistant Director
RAYMOND H . MASSEY, Assistant Director
EDWARD T. MULRENIN, Assistant Director
DAY W . RADEBAUGH, JR., Assistant Director
ELIZABETH B . RIGGS, Assistant Director
RICHARD C . STEVENS, Assistant Director
K Y U N G KIM,




JOHN H. PARRISH, Assistant

Director

Assistant Director
YOUNG, Assistant Director

LOUISE L . ROSEMAN,
FLORENCE M .

OFFICE OF THE INSPECTOR

GENERAL

BRENT L. BOWEN, Inspector
General
DONALD L. ROBINSON, Assistant Inspector General
BARRY R. SNYDER, Assistant Inspector General

74

Federal Reserve Bulletin • September 1993

Federal Open Market Committee
and Advisory Councils
FEDERAL OPEN MARKET

COMMITTEE
MEMBERS

A L A N GREENSPAN,

Chairman

WILLIAM J. MCDONOUGH,

Vice Chairman

WAYNE D . ANGELL

EDWARD W . KELLEY, JR.

DAVID W . MULLINS, JR.

EDWARD G . BOEHNE

JOHN P. LAWARE

SUSAN M . PHILLIPS

SILAS KEEHN

LAWRENCE B . LINDSEY

GARY H . STERN

ROBERT D . MCTEER, JR.

ALTERNATE

J. ALFRED BROADDUS, JR.

JERRY L . JORDAN

ROBERT P. FORRESTAL

JAMES H . OLTMAN

MEMBERS

ROBERT T. PARRY

STAFF
DONALD L. KOHN, Secretary
NORMAND R . V . BERNARD,

and

RICHARD W. LANG, Associate
Economist
DAVID E. LINDSEY, Associate
Economist
LARRY J. PROMISEL, Associate
Economist
ARTHUR J. ROLNICK, Associate
Economist
HARVEY ROSENBLUM, Associate
Economist
KARL A. SCHELD, Associate
Economist
Economist
CHARLES J. SIEGMAN, Associate
THOMAS D. SIMPSON, Associate
Economist
LAWRENCE SLIFMAN, Associate
Economist

Economist

Deputy Secretary

JOSEPH R. COYNE, Assistant
Secretary
GARY P. GILLUM, Assistant
Secretary
J. VIRGIL MATTINGLY, JR., General Counsel
ERNEST T. PATRIKIS,

Deputy General Counsel

MICHAEL J. PRELL, Economist
EDWIN M. TRUMAN, Economist

RICHARD G. DAVIS, Associate

Economist

Deputy Manager for Foreign Operations
Deputy Manager for Domestic Operations

MARGARET L . GREENE,
JOAN E . LOVETT,

FEDERAL ADVISORY

COUNCIL
E. B. ROBINSON, JR.,
JOHN B . MCCOY,

First District
Second District
ANTHONY P. TERRACCIANO, Third District
JOHN B . MCCOY, Fourth District
EDWARD E . CRUTCHFIELD, JR., Fifth District
E . B . ROBINSON, JR., Sixth District
MARSHALL

N.

CARTER,

CHARLES S . SANFORD, JR.,




President

Vice President
Seventh District
IE, Eighth District
JOHN F. GRUNDHOFER, Ninth District
DAVID A . RISMILLER, Tenth District
CHARLES R . HRDLICKA, Eleventh District
RICHARD M . ROSENBERG, Twelfth District
EUGENE A . MILLER,
ANDREW

B.

CRAIG,

HERBERT V. PROCHNOW, Secretary
WILLIAM J. KORSVIK, Associate
Secretary

A75

CONSUMER ADVISORY

COUNCIL

DENNY

D.

Denver, Colorado, Chairman
Chicago, Illinois, Vice Chairman

DUMLER,

JEAN POGGE,

DOUGLAS D . BLANKE,

Charlottesville, Virginia
Madison, Wisconsin
GARY S. HATTEM, New York, New York
JULIA E. HILER, Marietta, Georgia
RONALD HOMER, Boston, Massachusetts
THOMAS L. HOUSTON, Dallas, Texas

GENEVIEVE BROOKS,

HENRY JARAMILLO, Belen, N e w Mexico

BARRY A. ABBOTT, San Francisco, California
JOHN R. ADAMS, Philadelphia, Pennsylvania
JOHN

A.

BAKER,

BONNIE GUITON,

JOYCE HARRIS,

Atlanta, Georgia
Denver, Colorado

VERONICA E. BARELA,

MULUGETTA BIRRU, Pittsburgh, Pennsylvania

St. Paul, Minnesota
Bronx, New York

TOYE L. BROWN, Boston, Massachusetts

EDMUND MIERZWINSKI, W a s h i n g t o n , D . C .

CATHY CLOUD, W a s h i n g t o n , D . C .

JOHN V. SKINNER, Irving, Texas

MICHAEL

D. EDWARDS, Yelm, Washington
St. Louis, Missouri
NORMA L. FREIBERG, New Orleans, Louisiana
LORI GAY, LOS Angeles, California
DONALD A. GLAS, Hutchinson, Minnesota

LOWELL

MICHAEL FERRY,

MICHAEL

THRIFT INSTITUTIONS ADVISORY

N. SWANSON, Portland, Oregon
W. TIERNEY, Washington, D.C.

GRACE W. WEINSTEIN, Englewood, N e w Jersey
JAMES L . WEST,

Tijeras, New Mexico

ROBERT O . ZDENEK, W a s h i n g t o n , D . C .

COUNCIL

DANIEL

C. ARNOLD, Houston, Texas, President
Somerville, New Jersey, Vice President

BEATRICE D'AGOSTINO,

A. COOPER, Minneapolis, Minnesota
L. ECKERT, Davenport, Iowa
GEORGE R . GLIGOREA, Sheridan, Wyoming
THOMAS J. HUGHES, Merrifield, Virginia
KERRY KILLINGER, Seattle, Washington

Cleveland, Ohio
New Bedford, Massachusetts
NICHOLAS W. MITCHELL, JR., Winston-Salem, North Carolina
STEPHEN W. PROUGH, Irvine, California
THOMAS R . RICKETTS, Troy, Michigan

WILLIAM

CHARLES JOHN KOCH,

PAUL

ROBERT MCCARTER,




A76

Federal Reserve Board Publications
For ordering assistance, write PUBLICATIONS SERVICES,
MS-138, Board of Governors of the Federal Reserve System,
Washington, DC 20551 or telephone (202) 452-3244 or FAX
(202) 728-5886. When a charge is indicated, payment should
accompany request and be made payable to the Board of
Governors of the Federal Reserve System. Payment from foreign residents should be drawn on a U.S. bank.

THE FEDERAL RESERVE SYSTEM—PURPOSES AND FUNCTIONS.

1984. 120 pp.
ANNUAL REPORT.
ANNUAL REPORT: BUDGET REVIEW, 1991-92.
FEDERAL RESERVE BULLETIN. Monthly. $25.00

per year or
$2.50 each in the United States, its possessions, Canada,
and Mexico. Elsewhere, $35.00 per year or $3.00 each.
ANNUAL STATISTICAL DIGEST: period covered, release date,
number of pages, and price.
$ 6.50
October 1982
239 pp.
1981
$ 7.50
1982
December 1983
266 pp.
October 1984
264 pp.
$11.50
1983
254 pp.
1984
October 1985
$12.50
October 1986
$15.00
1985
231 pp.
November 1987
$15.00
1986
288 pp.
October 1988
272 pp.
$15.00
1987
November 1989
$25.00
256 pp.
1988
March 1991
712 pp.
$25.00
1980-89
November 1991
$25.00
185 pp.
1990
November 1992
215 pp.
$25.00
1991
SELECTED INTEREST AND EXCHANGE RATES—WEEKLY SERIES

OF CHARTS. Weekly. $30.00 per year or $.70 each in the
United States, its possessions, Canada, and Mexico. Elsewhere, $35.00 per year or $.80 each.
and other statutory provisions
affecting the Federal Reserve System, as amended through
August 1990. 646 pp. $10.00.

THE FEDERAL RESERVE ACT

REGULATIONS OF THE BOARD OF GOVERNORS OF THE FEDERAL
RESERVE SYSTEM.

(Truth in Lending—
Regulation Z) Vol. I (Regular Transactions). 1969. 100 pp.
Vol. II (Irregular Transactions). 1969. 116 pp. Each volume $2.25; 10 or more of same volume to one address,
$2.00 each.

ANNUAL PERCENTAGE RATE TABLES

Introduction to Flow of Funds. 1980. 68 pp. $1.50 each; 10 or
more to one address, $1.25 each.




Federal Reserve Regulatory Service. Looseleaf; updated at
least monthly. (Requests must be prepaid.)
Consumer and Community Affairs Handbook. $75.00 per
year.
Monetary Policy and Reserve Requirements Handbook.
$75.00 per year.
Securities Credit Transactions Handbook. $75.00 per year.
The Payment System Handbook. $75.00 per year.
Federal Reserve Regulatory Service. 3 vols. (Contains all
four Handbooks plus substantial additional material.)
$200.00 per year.
Rates for subscribers outside the United States are as follows
and include additional air mail costs:
Federal Reserve Regulatory Service, $250.00 per year.
Each Handbook, $90.00 per year.
THE U . S . ECONOMY IN AN INTERDEPENDENT WORLD: A MULTICOUNTRY MODEL, May 1984. 590 pp. $14.50 each.
WELCOME TO THE FEDERAL RESERVE. March 1989. 14 pp.
INDUSTRIAL PRODUCTION—1986 EDITION. December 1986.

440 pp. $9.00 each.
FINANCIAL FUTURES AND OPTIONS IN THE U . S . ECONOMY.

December 1986. 264 pp. $10.00 each.
FINANCIAL SECTORS IN OPEN ECONOMIES: EMPIRICAL ANALYSIS AND POLICY ISSUES. August 1990. 608 pp. $25.00 each.

CONSUMER EDUCATION
PAMPHLETS
Short pamphlets suitable for classroom use. Multiple copies are
available without charge.
Consumer Handbook on Adjustable Rate Mortgages
Consumer Handbook to Credit Protection Laws
A Guide to Business Credit for Women, Minorities, and Small
Businesses
How to File A Consumer Credit Complaint
Series on the Structure of the Federal Reserve System
The Board of Governors of the Federal Reserve System
The Federal Open Market Committee
Federal Reserve Bank Board of Directors
Federal Reserve Banks
Organization and Advisory Committees
A Consumer's Guide to Mortgage Lock-Ins
A Consumer's Guide to Mortgage Settlement Costs
A Consumer's Guide to Mortgage Refinancings
Home Mortgages: Understanding the Process and Your Right
to Fair Lending
Making Deposits: When Will Your Money Be Available?
When Your Home is on the Line: What You Should Know
About Home Equity Lines of Credit

All

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.
Staff Studies 1-145 are out of print.
1 4 6 . THE ROLE OF THE PRIME RATE IN THE PRICING OF
BUSINESS LOANS BY COMMERCIAL BANKS, 1 9 7 7 - 8 4 , b y

Thomas F. Brady. November 1985. 25 pp.

1 6 1 . A REVIEW OF CORPORATE RESTRUCTURING ACTIVITY,

1980-90, by Margaret Hastings Pickering. May 1991.
21pp.
1 6 2 . EVIDENCE ON THE SIZE OF BANKING MARKETS FROM
MORTGAGE LOAN RATES IN TWENTY CITIES, b y S t e p h e n

A. Rhoades. February 1992. 11 pp.
1 6 3 . CLEARANCE AND SETTLEMENT IN U . S . SECURITIES MAR-

KETS, by Patrick Parkinson, Adam Gilbert, Emily Gollob,
Lauren Hargraves, Richard Mead, Jeff Stehm, and Mary
Ann Taylor. March 1992. 37 pp.
1 6 4 . THE 1 9 8 9 - 9 2 CREDIT CRUNCH FOR REAL ESTATE, b y

James T. Fergus and John L. Goodman, Jr. July 1993.
20 pp.

1 4 7 . REVISIONS IN THE MONETARY SERVICES (DIVISIA) INDEXES OF THE MONETARY AGGREGATES, by Helen T. Farr

and Deborah Johnson. December 1985. 42 pp.
1 4 8 . THE MACROECONOMIC AND SECTORAL EFFECTS OF THE
ECONOMIC RECOVERY TAX ACT: SOME SIMULATION

RESULTS, by Flint Brayton and Peter B. Clark. December
1985. 17 pp.
1 4 9 . THE OPERATING PERFORMANCE OF ACQUIRED FIRMS IN
BANKING BEFORE AND AFTER ACQUISITION, b y S t e p h e n

A. Rhoades. April 1986. 32 pp.
1 5 0 . STATISTICAL COST ACCOUNTING MODELS IN BANKING:
A REEXAMINATION AND AN APPLICATION, by John T.

Rose and John D. Wolken. May 1986. 13 pp.
1 5 1 . RESPONSES TO DEREGULATION: RETAIL DEPOSIT PRICING
FROM 1983 THROUGH 1985, by Patrick I. Mahoney, Alice

P. White, Paul F. O'Brien, and Mary M. McLaughlin.
January 1987. 30 pp.
1 5 2 . DETERMINANTS OF CORPORATE MERGER ACTIVITY: A
REVIEW OF THE LITERATURE, by Mark J. Warshawsky.

April 1987. 18 pp.
by Carolyn D. Davis and
Alice P. White. September 1987. 14 pp.

1 5 3 . STOCK MARKET VOLATILITY,

1 5 4 . T H E EFFECTS ON CONSUMERS AND CREDITORS OF
PROPOSED CEILINGS ON CREDIT CARD INTEREST RATES,

by Glenn B. Canner and James T. Fergus. October 1987.
26 pp.
155. THE FUNDING OF PRIVATE PENSION PLANS, by Mark J.
Warshawsky. November 1987. 25 pp.
1 5 6 . INTERNATIONAL TRENDS FOR U . S . BANKS AND BANKING

MARKETS, by James V. Houpt. May 1988. 47 pp.
1 5 7 . M 2 PER UNIT OF POTENTIAL G N P AS AN ANCHOR FOR
THE PRICE LEVEL, by Jeffrey J. Hallman, Richard D.

Porter, and David H. Small. April 1989. 28 pp.
1 5 8 . THE ADEQUACY AND CONSISTENCY OF MARGIN REQUIREMENTS IN THE MARKETS FOR STOCKS AND DERIVATIVE

PRODUCTS, by Mark J. Warshawsky with the assistance of
Dietrich Eanihart. September 1989. 23 pp.
1 5 9 . N E W DATA ON THE PERFORMANCE OF NONBANK SUBSIDIARIES OF BANK HOLDING COMPANIES, by Nellie Liang

and Donald Savage. February 1990. 12 pp.
1 6 0 . BANKING MARKETS AND THE USE OF FINANCIAL SERVICES BY SMALL AND MEDIUM-SIZED BUSINESSES, b y

Gregory E. Elliehausen and John D. Wolken. September
1 9 9 0 . 3 5 pp.




REPRINTS OF SELECTED Bulletin ARTICLES
Some Bulletin articles are reprinted. The articles listed below
are those for which reprints are available. Most of the articles
reprinted do not exceed twelve pages. Limit of ten copies
Recent Developments in the Bankers Acceptance Market. 1/86.
The Use of Cash and Transaction Accounts by American
Families. 2/86.
Financial Characteristics of High-Income Families. 3/86.
Prices, Profit Margins, and Exchange Rates. 6/86.
Agricultural Banks under Stress. 7/86.
Foreign Lending by Banks: A Guide to International and U.S.
Statistics. 10/86.
Recent Developments in Corporate Finance. 11/86.
Measuring the Foreign-Exchange Value of the Dollar. 6/87.
Changes in Consumer Installment Debt: Evidence from the
1983 and 1986 Surveys of Consumer Finances. 10/87.
Home Equity Lines of Credit. 6/88.
Mutual Recognition: Integration of the Financial Sector in the
European Community. 9/89.
The Activities of Japanese Banks in the United Kingdom and in
the United States, 1980-88. 2/90.
Industrial Production: 1989 Developments and Historical
Revision. 4/90.
Recent Developments in Industrial Capacity and Utilization.
6/90.
Developments Affecting the Profitability of Commercial Banks.
7/90.
Recent Developments in Corporate Finance. 8/90.
U.S. Exchange Rate Policy: Bretton Woods to Present. 11/90.
The Transmission Channels of Monetary Policy: How Have
They Changed? 12/90.
Changes in Family Finances from 1983 to 1989: Evidence from
the Survey of Consumer Finances. 1/92.
U.S. International Transactions in 1991. 5/92.

A78

Maps of the Federal Reserve System

LEGEND

Both pages
• Federal Reserve Bank city
• Board of Governors of the Federal
Reserve System, Washington, D.C.

Facing page
• Federal Reserve Branch city
— Branch boundary

NOTE

The Federal Reserve officially identifies Districts
by number and Reserve Bank city (shown on both
pages) and by letter (shown on the facing page).
In the 12th District, the Seattle Branch serves
Alaska, and the San Francisco Bank serves Hawaii.
The System serves commonwealths and territories as follows: the New York Bank serves the



Commonwealth of Puerto Rico and the U.S. Virgin
Islands; the San Francisco Bank serves American
Samoa, Guam, and the Commonwealth of the
Northern Mariana Islands. The Board of Governors
revised the branch boundaries of the System most
recently in December 1991.

A79

1-A

3-C

2-B

5_£

4-D

Baltimore

Pittsburgh

VT

i<

NN

Charlotte
•Cincinnati

\

Buffalo

MAB
CT

CT
/

NJ

KY

NY

VRI

BOSTON

NEW YORK

6-F

PHILADELPHIA
7-G

• Nashville

RICHMOND

CLEVELAND
8-H

Birmingham,

-

M"

Louisville

Detroit •

KY

1L •
'

Jacksonville

NwcTOrleans

• Memphis

WBtKMFmi^'

„

J

ATLANTA

m

Uttl? )
Rock
*

CHICAGO

ST. LOUIS

9-1

MINNEAPOLIS

12-L

10-J

WA

•

ALASKA

Seattle

•
OklahomajCity

OR

/ID

i(Bp(Ill )

o
CA

KANSAS CITY

7

NV

/

11-K

DALLAS



1

•

i|jj||fj»
\
R\
|\

P

v

HAWAII

SAN FRANCISCO

UT

#
Salt Lake City

T

AZ

A80

Federal Reserve Banks, Branches,
and Offices
FEDERAL RESERVE BANK
Chairman
branch, or facility
Zip
Deputy Chairman

President
First Vice President

BOSTON*

02106

Richard F. Syron
Cathy E. Minehan

NEW YORK*

10045

Jerome H. Grossman
Warren B. Rudman

Ellen V. Futter
Maurice R. Greenberg
14240 Joseph J. Castiglia

William J. McDonough
James H. Oltman

PHILADELPHIA

19105 Jane G. Pepper
James M. Mead

Edward G. Boehne
William H. Stone, Jr.

CLEVELAND*

44101

A. William Reynolds
G. Watts Humphrey, Jr.
45201 Marvin Rosenberg
15230 Robert P. Bozzone

Jerry L. Jordan
Sandra Pianalto

23219

J. Alfred Broaddus, Jr.
Jimmie R. Monhollon

Buffalo

Cincinnati
Pittsburgh
RICHMOND*

Baltimore
21203
Charlotte
28230
Culpeper Communications
and Records Center 22701
ATLANTA
Birmingham
Jacksonville
Miami
Nashville
New Orleans
CHICAGO*
Detroit
ST. LOUIS
Little Rock
Louisville
Memphis
MINNEAPOLIS
Helena
KANSAS CITY
Denver
Oklahoma City
Omaha
DALLAS
El Paso
Houston
San Antonio
SAN FRANCISCO
Los Angeles
Portland
Salt Lake City
Seattle

Anne Marie Whittemore
Henry J. Faison
Rebecca Hahn Windsor
Anne M. Allen

James O. Aston

30303

Edwin A. Huston
Leo Benatar
35283 Donald E. Boomershine
32231 Joan D. Ruffier
33152 R. Kirk Landon
37203 James R. Tuerff
70161 Lucimarian Roberts

Robert P. Forrestal
Jack Guynn

60690 Richard G. Cline
Robert M. Healey
48231 J. Michael Moore

Silas Keehn
William C. Conrad

63166

Robert H. Quenon
Janet McAfee Weakley
72203 Robert D. Nabholz, Jr.
40232 John A. Williams
38101 Seymour B. Johnson

Thomas C. Melzer
James R. Bowen

55480

Gary H. Stern
Colleen K. Strand

59601

Delbert W. Johnson
Gerald A. Rauenhorst
James E. Jenks

64198

Vice President
in charge of branch

Charles A. Cerino1
Harold J. Swart1

Ronald B. Duncan1
Walter A. Varvel1
John G. Stoides1

Donald E. Nelson1
Fred R. Herr1
James D. Hawkins1
James T. Curry III
Melvyn K. Purcell
Robert J. Musso

Roby L. Sloan1

Karl W. Ashman
Howard Wells
John P. Baumgartner

John D. Johnson

Burton A. Dole, Jr.
Herman Cain
80217 Barbara B. Grogan
73125 Ernest L. Holloway
68102 Sheila Griffin

Thomas M. Hoenig
Henry R. Czerwinski

75201

Leo E. Linbeck, Jr.
Cece Smith
79999 W. Thomas Beard, III
77252 Judy Ley Allen
78295 Erich Wendl

Robert D. McTeer, Jr.
Tony J. Salvaggio

94120 James A. Vohs
Judith M. Runstad
90051 Donald G. Phelps
97208 William A. Hilliard
84125 Gary G. Michael
98124 George F. Russell, Jr.

Robert T. Parry
Patrick K. Barron

Kent M. Scott
David J. France
Harold L. Shewmaker

Sammie C. Clay
Robert Smith, III1
Thomas H. Robertson

John F. Moore1
E. Ronald Liggett1
Andrea P. Wolcott
Gordon Werkema1

•Additional offices of these Banks are located at Lewiston, Maine 04240; Windsor Locks, Connecticut 06096; East Rutherford, New Jersey 07016; Jericho,
New York 11753; Utica at Oriskany, New York 13424; Columbus, Ohio 43216; Columbia, South Carolina 29210; Charleston, West Virginia 25311;
Des Moines, Iowa 50306; Indianapolis, Indiana 46204; and Milwaukee, Wisconsin 53202.
1. Senior Vice President.



Federal Reserve Statistical Releases
Available on the Commerce Department's
Economic Bulletin Board
The Board of Governors of the Federal Reserve
System makes some of its statistical releases available to the public through the U.S. Department of
Commerce's economic bulletin board. Computer
access to the releases can be obtained by sub-

scription. For further information regarding a
subscription to the economic bulletin board,
please call (202) 482-1986. The releases transmitted
to the economic bulletin board, on a regular basis,
are the following:

Reference
Number

Statistical release

Frequency of release

H.3

Aggregate Reserves

Weekly/Thursday

H.4.1

Factors Affecting Reserve Balances

Weekly/Thursday

H.6

Money Stock

Weekly/Thursday

H.8

Assets and Liabilities of Insured Domestically Chartered
and Foreign Related Banking Institutions

Weekly/Monday

H.10

Foreign Exchange Rates

Weekly/Monday

H.15

Selected Interest Rates

Weekly/Monday

G.5

Foreign Exchange Rates

Monthly/end of month

G.17

Industrial Production and Capacity Utilization

Monthly/midmonth

G.19

Consumer Installment Credit

Monthly/fifth business day

Z.7

Flow of Funds

Quarterly




Publications of Interest
FEDERAL RESERVE REGULATORY

SERVICE

To promote public understanding of its regulatory
functions, the Board publishes the Federal Reserve
Regulatory Service, a three-volume looseleaf service
containing all Board regulations as well as related
statutes, interpretations, policy statements, rulings,
and staff opinions. For those with a more specialized
interest in the Board's regulations, parts of this service are published separately as handbooks pertaining
to monetary policy, securities credit, consumer affairs,
and the payment system.
These publications are designed to help those who
must frequently refer to the Board's regulatory materials. They are updated monthly, and each contains
citation indexes and a subject index.
The Monetary Policy and Reserve Requirements
Handbook contains Regulations A, D, and Q, plus
related materials.
The Securities Credit Transactions Handbook contains Regulations G, T, U, and X, dealing with extensions of credit for the purchase of securities, together
with related statutes, Board interpretations, rulings,
and staff opinions. Also included are the Board's list

of marginable OTC stocks and its list of foreign
margin stocks.
The Consumer and Community Affairs Handbook
contains Regulations B, C, E, M, Z, AA, and BB, and
associated materials.
The Payment System Handbook deals with expedited funds availability, check collection, wire transfers, and risk-reduction policy. It includes Regulation
CC, Regulation J, the Expedited Funds Availability
Act and related statutes, the official Board commentary on Regulation CC, and policy statements on risk
reduction in the payment system.
For domestic subscribers, the annual rate is $200
for the Federal Reserve Regulatory Service and $75
for each Handbook. For subscribers outside the
United States, the price including additional air mail
costs is $250 for the Service and $90 for each Handbook. All subscription requests must be accompanied
by a check or money order payable to the Board of
Governors of the Federal Reserve System. Orders
should be addressed to Publications Services, mail
stop 138, Board of Governors of the Federal Reserve
System, Washington, DC 20551.

U.S. MONETARY POLICY AND FINANCIAL MARKETS
U.S. Monetary Policy and Financial Markets by AnnMarie Meulendyke offers an in-depth description of
the way monetary policy is developed by the Federal
Open Market Committee and the techniques employed to implement policy at the Open Market Trading Desk. Written from her perspective as a senior
economist in the Open Market Function at the Federal
Reserve Bank of New York, Ann-Marie Meulendyke
describes the tools and the setting of policy, including
many of the complexities that differentiate the process
from simpler textbook models. Included is an account
of a day at the Trading Desk, from morning
information-gathering through daily decisionmaking
and the execution of an open market operation.
The book also places monetary policy in a broader




context, examining first the evolution of Federal
Reserve monetary policy procedures from their beginnings in 1914 to the end of the 1980s. It indicates how
policy operates most directly through the banking
system and the financial markets and describes key
features of both. Finally, the book turns its attention to
the transmittal of monetary policy actions to the U.S.
economy and throughout the world.
The book is $5.00 a copy for U.S. purchasers and
$10.00 for purchasers outside the United States. Copies are available from the Public Information Department, Federal Reserve Bank of New York, 33 Liberty
Street, New York, NY 10045. Checks must accompany orders and should be payable to the Federal
Reserve Bank of New York in U.S. dollars.

Publications of Interest
FEDERAL RESERVE CONSUMER CREDIT PUBLICATIONS
The Federal Reserve Board publishes a series of
pamphlets covering individual credit laws and topics,
as pictured below. The series includes such subjects
as how the Equal Credit Opportunity Act protects
women against discrimination in their credit dealings,
how to use a credit card, and how to resolve a billing
error.
The Board also publishes the Consumer Handbook
to Credit Protection Laws, a complete guide to consumer credit protections. This forty-four-page booklet
explains how to shop and obtain credit, how to maintain a good credit rating, and how to dispute unfair
credit transactions.

Three booklets on the mortgage process are also
available: A Consumer's Guide to Mortgage Lock-Ins,
A Consumer's Guide to Mortgage Refinancings, and
A Consumer's Guide to Mortgage Settlement Costs.
These booklets were prepared in conjunction with the
Federal Home Loan Bank Board and in consultation
with other federal agencies and trade and consumer
groups.
Copies of consumer publications are available free
of charge from Publications Services, mail stop 138,
Board of Governors of the Federal Reserve System,
Washington, DC 20551. Multiple copies for classroom use are also available free of charge.

Business
Credit

A Consumer's
Guide to
Mortgage
Lock-Ins




for Women,
Minorities, and
Small B u s i n e s s e s

r

to Credit Protection

1