Federal Reserve Banks bring $34.9 billion to the U.S. Treasury

On Friday last week the Federal Reserve Board provided preliminary results indicating Reserve Banks recorded payments and provisions. This year about $34.9 billion of their estimated 2008 net income of $38.8 billion will be transferred to the U.S. Treasury. To follow the Board’s policy Reserve Banks transferred their remaining estimated 2008 net income to the U.S. Treasury after providing for $1.2 billion in statutory dividends to member banks and $2.7 billion to equate surplus to paid-in capital.

In 2008 the income earned from U.S. government and Federal agency securities amounted to $27.5 billion and the income earned from loans amounted to $7.2 billion. Besides, the income from reciprocal currency arrangements and investments denominated in foreign currencies made up $4.2 billion, and income from fees for the provision of priced services to depository institutions totaled $0.8 billion.

The Federal Reserve also reported that net operating expenses of the twelve Reserve Banks amounted $2.6 billion in 2008. Net additions to income were $4.3 billion, with $3.8 billion representing realized gains on sales of U.S. government securities. The final 2008 results, which will include any valuation adjustments, will be reflected in the Reserve Banks' annual financial reports and in the Board of Governors' Annual Report.