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DALLAS
Federal Reserve Bank of Dallas

February 1986

Volume 5, Number 2

Board issues public comment on proposal

Policies on bank capital...
The Federal Reserve Board has
issued for public comment a proposal
intended to bring its policies on bank
capital into better alignment with the
risk profile of the banking industry.
The objective of this Supplemental
Adjusted Capital Measure is to
enhance the strength and promote
the safety and soundness of the
banking system.
Capital adequacy is one critical
factor the Board of Governors is re­
quired to analyze in taking action on
various types of applications, such as
mergers and acquisitions by bank
holding companies. Revised guide­
lines for minimum and appropriate
levels of capital for bank holding
companies and state chartered banks
were announced in April 1985.
In conjunction with other federal
bank regulatory agencies, the guide­
lines were designed to establish
uniform capital standards for all
federally regulated banking organiza­
tions regardless of size. Uniform
capital standards were based on
ratios of primary and total capital to
total assets.
Since the Board believes there is a
need to modify its capital policies to
be more explicitly and systematically
sensitive to the risk exposure of in­
dividual banking organizations, it is
proposing to amend its current
guidelines.
The proposed guideline which
establishes categories for assets and

off-balance sheet items would supple­
ment, but not replace, the existing
capital standards that the bank
regulatory agencies have strength­
ened in recent years. Measures de­
signed to achieve the objectives of
the policy are:
• to address off-balance sheet ex­
posures, which expanded rapidly at
many large institutions over the last
several years;
• to temper disincentives inherent
in the existing guidelines to hold low
risk, relatively liquid assets;
• to move U.S. capital adequacy
policies more closely in line with
those of other major industrial coun­
tries; and
• to provide more explicit guidance
to bankers and examiners for relating
capital to risk profiles.
Assets and certain off-balance
sheet items would be assigned to one
of four broad risk categories. The
categories would be weighted accord­
ing to their relative risk. The four
categories would include: (1) cash
and equivalent, (2) money market risk,
(3) moderate risk, and (4) standard
risk.
Cash and equivalent (weight, zero
percent) would consist of assets
generally considered to be riskless,
such as vault cash and balances due
from Federal Reserve Banks. Money
market risk (weight, 30 percent) would
cover assets which have little or no
risk of default and a high degree of li­

quidity, such as all U.S. Treasury
securities with over one year to
maturity.
Moderate risk (weight, 60 percent)
would consist of assets having more
credit liquidity risk than money
market items, but significantly less
than the standard commercial bank
loan portfolio. Items in this category
might include state, county and
municipal securities. Standard risk
(weight, 100 percent) would cover
assets generally found in a typical
bank loan portfolio and those not in­
cluded in the previously listed
categories. This group might include
commercial or industrial loans.
For a copy of the Board’s press
release regarding the intended pro­
posal, call (214) 651-6222. Any public
comments for this proposal (referred
to as Docket No. R-0567) should be
sent by April 25, to William W. Wiles,
Secretary, Board of Governors of the
Federal Reserve System, 20th and
Constitution Avenue, N.W.,
Washington D.C. 20551.

INSIDE________________
■ FRS GROSS INCOME________
■ REGULATION D CHANGES
■ EMPLOYEE SALARY SURVEY
■ BOG APPOINTEES
■ CUSTOMER SERVICES

Federal Reserve grosses $18 billion
The Federal Reserve System’s
gross income in 1985 amounted to
$18,132 billion. More than $17 billion
of that figure was returned to the U.S.
Treasury.
Interest accrued on U.S. govern­
ment securities that the Federal
Reserve System has acquired through
open market operations is the main
source of income for the Fed. In 1985,
income earned from the provision of
financial services amounted to $614
million.
Operating expenses of the 12
Reserve Banks and branches totaled
$1,127 billion, including $102 million
for earnings credits granted to

depository institutions.
Expenses of the Board of Gover­
nors totaled $77 million, while the
cost of new currency amounted to
$174 million. Net additions to current
net income amounted to $1.3 billion.
This resulted primarily from a $1.2
billion increase in the value of assets
denominated in foreign currencies
(rehated to revaluation of these assets
at market exchange rates) and a $99
million gain on sales of U.S. govern­
ment obligations.
Net income before dividends, addi­
tions to surplus and payments to the
Treasury totaled $18,056 billion.
Statutory dividends to member banks

were $103 million, additions to
Reserve Bank surplus were $155
million and payments to the Treasury
amounted to $17,798 billion.
Under the policy established by the
Board of Governors at the end of
1964, all net income after the
statutory dividend to members banks
and the amount necessary to equate
surplus to paid-in capital is trans­
ferred to the U.S. Treasury as “ in­
terest on Federal Reserve notes.”
In 1984, the Federal Reserve
System had revenue of $18.07 billion
and paid $16.05 billion to the
Treasury.

Changes made on Regulation D
The Federal Reserve Board an­
nounced an increase of $1.9 million in
the amount of net transaction ac­
counts to which the three percent
reserve requirement applies. The in­
crease went from $29.8 million to
$31.7 million. These adjustments took
effect Dec. 31, 1985.
Provisions of the Monetary Control
Act, require the Board to amend
Regulation D—Reserve Requirements
of Depository Institutions—annually
to increase the amount of transaction
accounts subject to a three percent
reserve requirement.
Annual adjustments must be 80
percent of the annual percentage in­
crease in transaction accounts held
by all depository institutions. The
growth in total net transaction ac­
counts of all depository institutions
from June 30, 1984 to June 30, 1985
was 8.1 percent. Thus, the statutory

rule required the increase of $1.9
million over last year’s amount.
In addition, the amount of reservable liabilities of each depository in­
stitution that is subject to a reserve
requirement of zero percent has been
increased from $2.4 million to $2.6
million, as required by the Garn-St
Germain Depository Institutions Act
of 1982. The growth in total reservable liabilities was 9.1 percent from
June 30, 1984 to June 30, 1985.
The Board has also changed the
basis of the reporting cut-off level
(previously $25 million in deposits)
which was used to separate weekly
reporters from quarterly reporters.
The new basis is being indexed to 80
percent of the annual percentage in­
crease in total deposits and other
reservable liabilities. The annual ad­
justment will be computed as of June
30 of each year.

Employees’
Average
Salary Results*
(Eleventh District)

Employee Position

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
27.
28.

Average
Salary

Head T e lle r.................................................................... $15,050
Paying and Receiving Teller ......................................... 11,420
Savings T e lle r................................................................
12,492
Note Teller......................................................................
12,889
Universal Teller..............................................................
11,247
Executive Secretary......................................................
17,035
Secretary........................................................................ 13,906
Secretary-Receptionist ................................................. 12,074
Telephone Operator......................................................
11,201
Proof Machine Operator ............................................... 11,068
Bookkeeper....................................................................
11,246
General Ledger C le rk....................................................
13,306
Check File C le rk ............................................................
10,312
General Clerk ................................................................
12,005
Supervisor-Bookkeeping............................................... 15,770
Senior Programmer ......................................................
26,139
Junior Programmer........................................................
20,974
Data Processing Manager............................................. 18,188
Computer Operator ......................................................
13,131
Key Punch Operator......................................................
12,172
Encoding Machine Operator......................................... 10,730
Forms Control Analyst................................................... 16,415
New Accounts Clerk......................................................
13,194
Audit Clerk......................................................................
15,052
Credit Department C le rk ............................................... 12,695
Trust Department C le rk................................................. 12,807
Management Trainee..................................................... 16,160
C ustodian......................................................................
10,739

‘ Taken from the Employee Salary Survey of the Eleventh District.
The survey, conducted annually by the Corporate Banking
Department, is offered as a free service to the District’s financial
institutions. For a copy of either the Employee or Officer Salary
Survey call the Corporate Banking Department at (214) 651-6261
or (214) 651-6370.

Senate confirms BOG appointees
Wayne Angell and Manuel Johnson
were recently sworn in as governors
of the seven-member Federal Reserve
Board. Angell, a director of the
Kansas City Federal Reserve Bank, is
from Kansas where he had been a
farmer, banker and economic pro­
fessor. Johnson had been assistant
Treasury secretary for economic
affairs.

Angell and Johnson were
nominated by President Reagan to
replace Lyle P. Gramley and J.
Charles Partee, respectively, and con­
firmed by the Senate. Members of the
Board of Governors serve 14-year
terms. Other members are: Paul A.
Volcker, Chairman; Preston Martin,
Vice Chairman; Plenry C. Wallich,
Emmett J. Rice, and Martha R. Seger.

Customer Assistance expands
The Customer Assistance Group for
the Eleventh Federal Reserve District
was expanded this January to handle
questions relating to certain services
provided by the Federal Reserve Bank
of Dallas.
Currently, institutions located in
the Dallas Office territory can call
one telephone number to obtain
assistance relating to the following
services: federal reconcilement,
verification of reserve account
balances for reserve account
maintenance and missing cash
letters.
Institutions located in Branch Of­
fice territories should continue to call
the appropriate operating depart­
ments at the Branch that serves its
area.

All institutions, regardless of loca­
tion, that have questions about their
reserve account balances should call
the Dallas Office Customer Assis­
tance telephone number listed below.
Customer Assistance
Telephone Number:

Dallas Territory Institutions Only
Customer Assistance
Group
(214) 698-4246
Branch Office Telephone Numbers:
(Contact the appropriate department
for all questions except those relating
to reserve account balances)

El Paso Branch
Flouston Branch
San Antonio Branch

(915) 544-4730
(713) 659-4433
(512)224-2141

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