United States Banking

Federal Reserve Bank Board Of Governers

Facts

Members Appointed By President and Confirmed By Senate

Serve 14 Year Terms, staggered

Chairman and Vice-Chairman Serve 4 year terms

Go to All FOMC Meetings and Have Majority Vote

Oversee Reserve Banks and Approve Directors

Located in Washington D.C.

Sets Reserve Requirements

Sets Margin Requirements

Approves Discount Rate
(interest rate at which Banks
can borrow from Federal Reserve Banks
in their district)

3 Different Version of the Discount Rate
1. Primary Credit Rate
2. Secondary Credit Rate
3. Seasonal Credit Rate

Set the interest rate on required reserves (interest that federal reserve banks pay to other banks for the money held as required reserves)

Set the interest rate on excess reserves (interest that federal reserve banks pay to other banks for the money held as excess reserves)

Represents United States in negotiations with foreign goverments

Federal Open Market Committee (FOMC)

Facts

Sets Monitary Policy

Influences Federal Funds Rate through
open market operations.

Voting Members Consist Board of Governors(majority), President from the District Bank of New York and 4 other presidents of District Banks.

Manages the Nations Money Supply

The Chairman of the Board Of Governors Chairs the FOMC

Meets about 8 Times a year in Disctric of Columbia

Distric Bank Directors Apparently Bring in the
influence of the private sector persepective.

Conduct Open Market Operations (Quantitative Easing, Purchasing or Selling of Securities)

District Reserve Banks

12 Reserve Banks and Their Districts

Richmond

Minneapolis

Atlanta

St. Louis

Sanfrancisco

Dallas

Cleveland

Kansas City

Chicago

New York

Owns 1/4 of assets in Fed System

Philadelphia

Boston

Facts

Make loans available at discount to other banks

Each Reserve Bank Have Board Of Directors

President and Vice President must be Approved By Federal Reserve B.O.G

Provide Financial Services to Banks In District

Sells Treasury Notes for the US Treasury

Handle Treasury payments, securities, cash management
invesment activities.

Conduct Research on Econmic Activity

Supervise Commercial Banks

Nine Directors per District Bank
6 Elected By Member Banks
3 Appointed By Board of Governors

Member Commercial Banks (3,000)

Facts

All member banks hold stock in reserve banks of corresponding district and receive dividends from them.

Must hold 3 percent of captial as stock of Reserve Bank

38% of the 8,039 Commercial Banks are Members of the Federal Reserve System

National Banks Have to Be Members

Cannot Sell Fed Stock

State Chartered Banks Can Become Members if Qualified

Small

Large

Goldman Sachs

CitiBank

Bank of America

JP Morgan

Medium

Other Depository Institutions (17,000)

Non Member Commercial Banks

Savings Banks

Savings and Loan Associations

Credit Unions

Facts

Still under Federal Reserve Regulations