Federal Reserve Membership and Monetary Control

This report discusses the current state of monetary policy. Questions about the continued capability of the Federal Reserve System (FRS) to exercise effective monetary control were raised in connection with several developments over recent years that diminished, in relative terms, the deposit component of the stock of money over which the FRS maintained reserve requirement controls. The Monetary Control Act, Title 1 of P.L. 96-221 was designed to ensure that the FRS as ability to conduct monetary policy is not diminished. This Act, signed into law on Mar. 31, 1980, is one of the few major amendments to the original Federal Reserve Act of 1913.

F E D E R BL BESEBVE L I E l B E R S E I P AND HONETARY C O N T R O L ( a a c a x v m - - 0 1/12/81) ISSUE BRIEF NUMBER IB79047 AUTHOR : White, Roger con on ics Division THE LIBRARY O F CONGRESS C O N G R E S S I O N A L RESXAR CR S E R V I C E MAJOR ISSUES S Y S T Z a DATE OR I G I N A T Z D 0 4 / 2 2 2 2 DATE U P D A T E D gj/7la F O B A D D I T I O N A L I N F O R P I A T I O N C A L L 287-570 0 0470 Q u e s t i o n s a b o u t t h e c o n t i n u e d c a p a b i l i t y of t h e F e d e r a l Reserve System (FBS) t o e x e r c i s e e f f e c t i v e m o n e t a r y c o n t r o l w e r e r a i s e d i n c o n n e c t i o n w i t h s e v e r a l d e v e l o p m e n t s o v e r r e c e n t y e a r s t h a t d i m i n i s h e d , i n r e l a t i v e terlas, t h e d e p o s i t component of t h e s t o c k o f money o v e r which t h e FBS m a i n t a i n e d reserve requireaent controls. The B o n e t a r y C o n t r o l A c t , T i t l e 1 o f I?,%96-221 was d e s i g n e d t o e n s u r e t h a t t h e PRS as a b i l i t y t o c o n d u c t nanetary p o l i c y is n o t diminished. T h i s A c t , s i g n e d i n t o law on Har. 31, 29810, is o n e o f t h e f e w a a j o r amendments t o the o r i g i n a l F e d e r a l R e s e r v e A c t of 1913. BACKGROUBD ----AND POLICY ANALYSIS ------------------ Congressional i n t e r e s t i n t h e FBS1s monetary control capability arose - b e c a u s e of a s i z e a b l e d e c r e a s e in t h e p r o p o r t i o n o f t r a n s a c t i o n s a c c o u n t s f o r v h i c h t h e PRS r e c e i v e d d i r e c t and prompt d a t a a n d o v e r w h i c h i t n a i n t a i n e d r e s e r v e requirement controls. D e v e l o p m e n t s which a d v e r s e l y a f f e c t e d t h e F R S g s s p h e r e of d i r e c t c o n t r o l were d e c l i n i n g membership and i n c r e a s e d u s a g e of a l t e r n a t i v e s t o c h e c k i n g a c c o u n t s f o r c a r r y i n g o u t f i n a n c i a l t r a n s a c t i o n s . Before e n a c t m e n t o f POLI 96-221, o n l y member b a n k s were s u b j e c t t o FRS r e s e r v e r e q u i r e u e n t s . . The p r o p o r t i o n o f b a n k s v i t h membership i n t h e PRS r e l a t i v e t o t o t a l b a n k s i n t h e c o u n t r y h a s b e e n d e c l i n i n g s i n c e 1946. In recent years, t h i s decline accelerated. D e p o s i t s i n FBS aember b a n k s now c o n s t i t u t e a b o u t 70% of t o t a l bank d e p o s i t s a s compared w i t h 87% t e n y e a r s The n b n r d e n of m e ~ b e r s h i p , " v h i c h is c i t e d a s a g o a n d 77% f i v e y e a r s ago. t h e c a u s e f o r t h i s p h e n o a e n o n , a r o s e from f o r e g o n e b a n k e a r n i n g s o n r e q u i r e d reserves. R e q u i r e d r e s e r v e s f o r member b a n k s , h e l d i n a m o u n t s c o m e s p o n d i n g t o s p e c i f i e d percentages of v a r i o u s t y p e s o f d e p o s i t s h e l d with t h e banks, h a d t o b e h e l d i n t h e form o f v a u l t c a s h a n d / o r d e p o s i t s w i t h t h e PRS. N e i t h e r f o r n o f h o l d i n g r e s e r v e s g e n e r a t e d i n t e r e s t income f o r b a n k s . Nonmember b a n k s were s u b j e c t t o s t a t e i m p o s e d r e s e r v e r e q u i r e m e n t s t h a t v e r e g e n e r a l l y l o w e r a n d , i n a n u a b e r o f cases, a l l o w e d f o r h o l d i n g some p o r t i o n of r e q u i r e d r e s e r v e s i n i n t e r e s t e a r n i n g a s s e t s . Uith high i n t e r e s t r a t e s i n r e c e n t y e a r s , a n i n c r e a s i n g number of member b a n k s c o n c l u d e d t h a t t h e cost o f holding non-interest earning r e s e r v e s exceeded t h e value of s e r v i c e s obtained on t h e b a s i s o f membership a n d o p t e d t o l e a v e t h e FRS. Over t h e 7 9 7 0 * s , t h e r e was a l s o a n i n c r e a s e i n t h e a v a i l a b i l i t ? a n d u s e o f i n t e s e s t e a r n i n g a l t e r n a t i v e s t o c h e c k i n g a c c o u n t s f o r making f i n a n c i a l transactions Such a l t e r n a t i v e s i n c l u d e n e g o t i a b l e o r d e r s o f w i t h d r a w a l (NOW) a c c o u n t s , a n d s a v i n g s a c c o u n t s a c c e s s i b l e t h r o u g h t e l e p h o n e t r a n s f e r o r a n t m a t i c t r a n s f e r a r r a n g e m e n t s , The s t a t u t o r y a u t h o r i t y f o r s e v e i a l of b a s i s became perm a n e n t through t h e s e a c c o u n t f o r m s on a n a t i o n - w i d e p r o v i s i o n s of P .L. 96-221, t h e s a n e A c t t h a t p r o v i d e s f o r m o n e t a r y m n t r o l For t h r o u g h r e s t r u c t u r i n g and c h a n g i n g c o v e r a g e of PBS r e s e r v e r e q u i r e m e n t s . f u r t h e r information on t h i s l e g i s l a t i o n a s i t relates t o i n t e r e s t e a r n i n g " R e g u l a t i o n Q a n d I n t e r e s t on t r a n s a c t m n s a c c o u n t s , see CRS i s s u e b r i e f D e p o s i t s " (IB80056) l i s t e d i n t h e r e f e r e n c e s e c t i o n o f t h i s i s s u e b r i e f . . A t p r e s e n t , t h e a g g r e g a t e s i z e of i n t e r e s t e a r n i n g t r a n s a c t i o n s a c c o u n t s i s r e l a t i v e l y small b u t c u r r e n t a n d p o t e n t i a l g r o w t h r a t e s a r e c o n s i d e r a b l e . The d e v e l o p m e n t o f t h e s e a l t e r n a t i v e s , which a l l o w d e p o s i t o r s t o e a r n i n t e r e s t on t h e i r d e p o s i t s w i t h o u t f o r e g o i n g e a s y a c c e s s t o d e p o s i t s f o r CRS- 2 IB79047 UPDATE-01/12/81 p u r p o s e s o f making t r a n s a c t i o n s , r e f l e c t s i n c r e a s e d c o m p e t i t i o n among d e p o s i t o r y i n s t i t u t i o n s i n a n e n v i r o n m e n t o f h i g h i n t e r e s t rates, P r i o r t o e n a c t m e n t o f P.L. 96-221, t h e FBS m a i n t a i n e d c o n t r o l o v e r t h e a l t e r n a t i v e a c c o u n t a r r a n g e m e n t s o f f e r e d by member b a n k s t h r o u g h t h e r e s e r v e mechanism. T h e s e i n n o v a t i o n s , however, e v o l v e d i n l a r g e p a r t a s a r e s u l t of t h r i f t i n s t i t u t i o n s ( s a v i n g s and l o a n a s s o c i a t i o n s , m u t u a l s a v i n g s b a n k s , and c r e d i t u n i o n s ) o f f e r i n g t r a n s a c t i o n s a c c o u n t s . The o n l y t h r i f t i n s t i t u t i o n s t h a t h a v e t h e o p t i o n of FBS m e n b e r s h i p a r e m u t u a l s a v i n g s b a n k s a n d v e r y few of - t h e s e have exercised t h i s option, The d e b a t e o v e r t h e c o n s e q u e n c e s of a t t r i t i o n from t h e s p h e r e of PRS r e s e r v e requirement c o n t r o l s g e n e r a l l y focused on t h e p r o s p e c t s f o r monetary c o n t r o l should a t t r i t i o n c o n t i n u e a t a r a p i d pace, XS HONETBBY CONTROL THREA-BED? R e c e n t c h a n g e s i n t h e p e r c e n t a g e o f t o t a l t r a n s a c t i o n s a c c o u n t s c o v e r e d by FBS r e s e r v e r e q u i r e a e n t s r a i s e d s o a e b a s i c q u e s t i o n s a b o u t t h e r o l e o f r e s e r v e requirements with r e s p e c t t o monetary c o n t r o l . What p e r c e n t a g e of d e p c s i t s s h o u l d b e c o v e r e d ? Are r e s e r v e r e q u i r e m e n t s n e c e s s a r y a t a l l f o r e f f e c t i v e m o n e t a r y c o n t r o l ? Would e f f e c t i v e m o n e t a r y c o n t r o l b e r h r e a t e n e d by a c o n t i n u e d d e c l i n e i n t h e p e r c e n t a g e of d e p o s i t s c o v e r e d by PPS r e s e r v e controls? R e s e r v e r e q u i r e m e n t s s p e c i f y t h e assets t h a t n u s t b e h e l d a s r e s e r v e s i n a n o u n t s t h a t v a q v i t h t h e s i z e and type of d e p o s i t s held w i t h a g i v e n d e p o s i t o r y institution. T h e r e f ore, t h e r e s e r v e r e q u i r e m e n t s t r u c t u r e f o r d e p o s i t o r y i n s t i t u t i o n s is a m a j o r f a c t o r i n d e t e r m i n i n g t h e u l t i s a t e c h a n g e i n money s u p p l y o r t o t a l t r a n s a c t i o n s a c c o u n t s r e s u l t i n g from a g i v e n c h a n g e i n t h e amount of r e s e r v e s i n t h e b a n k i n g s y s t e m . The FRS s u p p l i e s o r a b s o r b s ban k i n g s y s tem r e s e r v e s t h r o u g h s e c u r i t i e s t r a n s a c t i o n s known a s open m a r k e t operations. T h e r e were two m a j o r a r g u m e n t s advanced i n s u g g e s t i n g t h a t a d e t e r i o r a t i o n o f monetary c o n t r o l was underway a s a r e s u l t o f t h e d e c l i n i n g p r o p o r t i o n of t r a n s a c t i o n s a c c o u n t s u n d e r FBS r e s e r v e r e q u i r e m e n t s . T h e s e a r g u m e n t s were b a s e d on t h e o b s e r v a t i o n t h a t r e s e r v e r e q u i r e m e n t p r o v i s i o n s f o r nonmember i n s t i t u t i o n s were n o t a n i f o r t a c r o s s a l l s u c h i n s t i t u t i o n s a n d t y p i c a l l y p r o v i d e d f o r a s m a l l e r p e r c e n t a g e of t r a n s a c t i o n s a c c o u n t s t o be h e l d i n t h e f o r m of r e s e r v e a s s e t s o v e r which t h e PBS had some g r o w t h r a t e c o n t r o l s t h r o u g h open m a r k e t o p e r a t i o n s . One a r g u m e n t was t h a t w i t h t h e ongoing d e c l i n e i n t h e r a t i o of r e s e r v e a s s e t s t o t r a n s a c t i o n s a c c o u n t s , a c t i o n s of b a n k s and t h e p u b l i c r e l a t i n g t o b a n k i n g s y s t e m r e s e r v e s were a t t a i n i n g g r e a t e r p o t e n t i a l f o r i n f l u e n c i n g u l t i m a t e c h a n g e s i n t h e amount of t r a n s a c t i o n s a c c o u n t s , F o r example, a d e c i s i o n by f i n a n c i a l i n s t i t u t i o n s t o slow t h e i r l o a n and d e p o s i t g r o w t h r a t e s s o a s t o b u i l d up p r e c a u t i o n a r y r e s e r v e s e x c e e d i n g r e q u i r e d l e v e l s was becoming i n c r e a s i n g l y i m p o r t a n t a s a p o t e n t i a l s o u r c e of c h a n g e i n t h e t o t a l amount o f t r a n s a c t i o n s a c c o u n t s i n a d i r e c t i o n a n d / o r b y amounts n o t a n t i c i p a t e d by t h e ?BS and p e r h a p s n o t i n k e e p i n g w i t h FRS m o n e t a r y p o l i c y . ?Ihe o t h e r a r g u m e n t was t h a t w i t h a l a r g e r s h a r e o f t r a n s a c t i o n s accounts i n nonmember i n s t i t u t i o n s , i t became i n c r e a s i n g l y d i f f i c u l t f o r t h e FBS t o p r e d i c t changes i n t r a n s a c t i o n s accounts a c c u r a t e l y . P o r example, r e s e r v e r e q u i r e m e n t s p e c i f i c a t i o n s f o r nonmember c o m m e r c i a l b a n k s v a r i e d from s t a t e t o s t a t e v i t h t h e r e s u l t t h a t $1,000 of new r e s e r v e s i n nonmember b a n k s c o u l d s u p p o r t d i f f e r e n t increases i n t r a n s a c t i o n s a c c o u n t s . I n t h e a b s e n c e of r e s e r v e r e q u i r e m e n t s , a s i t u a t i o n which e x i s t e d f o r nonmember b a n k s in I l l i n o i s , b a n k s m a i n t a i n e d a s e l f - d e t e r m i n e d amount o f v a u l t c a s h o p e r a t i n g " r e s e r v e s a t o accommodate n o r m a l n e e d s of t h e b a n k i n g b u s i n e s s . Those who d i d n o t view a d e c l i n e i n FBS r e s e r v e r e q u i r e m e n t c o v e r a g e a s a t h r e a t t o m o n e t a r y c o n t r o l g e n e r a l l y c i t e d t h e p o t e n c y o f open m a r k e t o p e r a t i o n s a s a n o f f s e t t o d i f f i c u l t i e s o u t l i n e d above should t h e y have become s o u r c e s of m o n e t a r y d i s t u r b a n c e . F o r e x a m p l e , open m a r k e t o p e r a t i o n s c a r r i e d out t o absorb r e s e r v e s could o f f s e t such expansionary i n f luences as t h o s e a s s o c i a t e d w i t h a s h i f t of f u n d s from d e p o s i t s having h i g h r e s e r v e r e q u i r e m e n t s t o t h o s e h a v i n g low r e s e r v e r e q u i r e m e n t s a n d d e c r e a s e s in %Be p u b l i c h o l d i n g s of c u r r e n c y r e l a t i v e t o d e p o s i t s . E x a c t l y how d i s r u p t i v e t o m o n e t a r y c o n t r o l c o n t i n u e d d e c l i n e s in PRS r e s e r v e r e q u i r e m e n t c o v e r a g e m i g h t h a v e become a n d hou s u c c e s s f u l open m a r k e t o p e r a t i o n s n i g h t h a v e b e e n i n s u c h an e n v i r o n m e n t a r e t o solse e x t e n t q u e s t i o n s f o r which a n s v e r s must b e l a r g e l y s p e c u l a t i v e i n t h e a b se n c e of f i r s t hand e x p e r i e n c e . ISSUES IB ADDITION TO BONETABY CONTROL S e v e r a l a p p r o a c h e s f o r a s s u r i n g a d e q u a t e n o n e t a r y c o n t r o l were a d v a n c e d in p r o p o s a l s which r e c e i v e d c o n g r e s s i o n a l c o n s i d e r a t i o n . These i n c l u d e (a) p r o v i d i n g t h e FBS w i t h prompt r e p o r t s on d e p o s i t s a n d r e s e r v e s f o r a l l depository financial institutions; (b) e x t e n d i n g restructured reserve some requireaents t o a l l depository institutions or t o a subset designated b a s i s o t h e r t h a n t h e p r e v i o u s b a s i s o f m e m b e r s h i p i n t h e FRS ; and (c) p r o v i d i n g i n c e n t i v e s f o r membership s u c h a s i n t e r e s t p a y m e n t s o n r e q u i r e d reserves. I n c o n n e c t i o n w i t h p r o p o s a l s t o pay i n t e r e s t on r e q u i r e d r e s e r v e s a n d t o r e s t r u c t u r e r e s e r v e r e q u i r e m e n t s , p r i c i n g p r i n c i p l e s were p r o p o s e d i n a n t i c i p a t i o n t h a t t h e FBS would c h a r g e e x p l i c i t l y f o r s e r v i c e s t h a t it o f f e r e d w i t h o u t c h a r g e t o member b a n k s . T h e r e a p p e a r e d t o b e g e n e r a l a g r e e m e n t t h a t i m p r o v i n g FRS a c c e s s t o d e p o s i t and r e s e r v e i n f o r m a t i o n would e n h a n c e i t s a b i l i t y t o a c t i n a n a p p r o p r i a t e a n d t i m e l y manner i n t h e c o n d u c t of m o n e t a r y p o l i c y . A s i n d i c a t e d i n t h e p r e c e d i n g s e c t i o n of this issue brief, there was d i s a g r e e l a e n t c o n c e r n i n g what m e a s u r e s d e a l i n g w i t h r e s e r v e r e q u i r e m e n t s , if a n y , s h o u l d be e n a c t e a . While o f f e r i n g p o s s i b l e a s s u r a n c e of c o n t i n u e d e f f e c t i v e m o n e t a r y c o n t r o l , l e g i s l a t i v e p r o p o s a l s d e s i g n e d t o implement a l t e r n a t i v e a p p r o a c h e s r a i s e d additional issues. These i n c l u d e d t h e c o n s e q u e n c e s of a l t e r n a t i v e a p p r o a c h e s f o r t h e f e d e r a l budget, f o r c o m p e t i t i v e r e l a t i o n s h i p s among d e p o s i t o r y i n s t i t u t i o n s a n d , f o r r e l a t i o n s h i p s b e t w e e n t h e s e i n s t i t u t i o n s a n d bank regulatory authorities, Budgetary i m p l i c a t i o n s of a l t e r n a t i v e r e s e r v e r e q u i r e n e n t arrangements The open a r o s e b e c a u s e o f t h e method t h r o u g h w h i c h t h e FBS c r e a t e s r e s e r v e s . m a r k e t o p e r a t i o n s , t h r o u g h w h i c h t h e FBS c r e a t e s r e s e r v e s , i n v o l v e s t h e . FXS's p u r c h a s e of g o v e r n m e n t securities on which i t e a r n s i n t e r e s t . A f t e r making a l l o w a n c e s f o r e x p e n s e s , t h e P R S s s e a r n i n g s , which a r e almost e x c l u s i v e l y i n t e r e s t i n c o m e f r o m its h o l d i n g s of g o v e r n l a e n t a l s e c u r i t i e s , are r e m i t t e d t o t h e T r e a s u r y . I n 1978, t h e FRS e a r n e d a b o u t $8 .5 b i l l i o n a n d t r a n s f e r r e d a b o u t $7 .0 b i l l i o n t o t h e T r e a s u r y . FBS r e m i t t a n c e s t o t h e T r e a s u r y would r e s e r v e s were r e d u c e d t h r o u g h a r e s t r u c t u r i n g of d e c r e a s e if FRS-reated CBS- 4 IB7 9047 UPDATE--0 1/12/81 r e s e r v e r e q u i r e m e n t s o r i f t h e FBS mere t o pay i n t e r e s t on b a n k r e s e r v e s . F o r p a z t i c u l a r d e p o s i t o r y i n s t i t u t i o n s a n d f o r i n s t i t u t i o n s grouped by s i z e o r o t h e r c h a r a c t e r i s t i c s , t h e cost a n d c o m p e t i t i v e i m p l i c a t i o n s d i f f e r a c c o r d i n g t o s p e c i f i c f e a t u r e s of p r o p o s a l s af feet i n g r e s e r v e r e q u i r e a e n t s o r t h e a v a i l a b i l i t y of F e d e r a l R e s e r v e System s e r v i c e s . F o r example, p r o p o s a l s e x e m p t i n g a n i n i t i a l amount o f d e p o s i t s from r e s e r v e r e q u i r e m e n t s v o u l d l e a v e s n a U d e p o s i t o r 7 i n s t i t u t i o n s ( t h o s e h a v i n g d e p o s i t s less t h a n t h e e x e m p t i o n P r o p o s a l s ._ l e v e l ) , without t h e c o s t s a s s o c i a t e d with r e s e r v e requirements, f o r extending reserve requireaents t o depository i n s t i t u t i o n s not previously c o v e r e d by FRS r e s e r v e r e q u i r e m e n t s c o u l d r e s u l t i n a c h a n g e i n t h e costs o f d e p o s i t o r y a c t i v i t i e s of t h e s e i n s t i t u t i o n s . Proposals including adjustments i n e x i s t i n g PRS r e s e r v e r e q u i r e m e n t l e v e l s v o u l d a f f e c t member b a n k s . S i n i l a r l y , t h e r e w o u l d be d i f f e r e n c e s i n t h e e f f e c t s o n v a r i o u s t y p e s of i n s t i t u t i o n s a r i s i n g f ma! a l t e r n a t i v e a r r a n g e m e n t s f o r t h e f o l l o v i n g : t h e t y p e of d e p o s i t s t o b e c o v e r e d by r e s e r v e r e q u i r e a e n t s and t h e l e v e l s of r e s e r v e r e q u i r e a e n t s f o r v a r i o u s d e p o s i t c a t g o r i e s ; t h e payment o f i n t e r e s t depository o n r e s e r v e s ; and t h e r a n g e of FRS s e r v i c e s a v a i l a b l e t o i n s t i t u t i o n s and t h e terms on v h i c h t h e y would b e made a v a i l a b l e . -' B e c a u s e c o m m e r c i a l b a n k s h a v e a s e t of o p t i o n s r e g a r d i n g t h e i r a f f i l i a t i o n w i t h o n e or sore F e d e r a l b a n k i n g a u t h o r i t i e s , c h a n g e s i n a r r a n g e m e n t s f o r r e s e r v e r e q u i r e m e n t s c o u l d l e a d b a n k s to e x e r c i s e o p t i o n s i n a d i f f e r e n t manner t h a n t h e y h a v e i n t h e p a s t . N a t i o n a l l y c h a r t e r e d b a n k s a r e s u b j e c t t o p r i m a r y r e g u l a t i o n by t h e O f f i c e o f t h e C o m p t r o l l e r of t h e C u r r e n c y , a r e members o f t h e FRS, a n d must b e i n s u r e d by t h e F e d e r a l D e p o s i t I n s u r a n c e C o r p o r a t i o n (FDIC), Banks o p e r a t i n g u n d e r s t a t e c h a r t e r s may j o i n t h e PRS i n which case t h e FRS is t h e p r i m a r y r e g u l a t o r y a g e n c y . PRS membership c a r r i e s w i t h i t a r e q u i r e m e n t of FDIC i n s u r a n c e , FDIC-insured s t a t e c h a r t e r e d b a n k s w i t h o u t m e n b e r s h i p i n t h e FBS a r e s u b j e c t t o p r i m a r y r e g u l a t i o n by t h e F D I C . FDIC i n s u r e d s t a t e c h a r t e r e d b a n k s , w h e t h e r members o r n o t , are s u b j e c t t o state a s w e l l a s f e d e r a l supervision. L e g i s l a t i v e r c e a s u r e s c o u l d a l t e r t h o s e f a c t o r s b a n k s c o n s i d e r when c h o o s i n g primary a f f i l i a t i o n w i t h a f e d e r a l r e g u l a t o r y a g e n c y . F o r e x a m p l e , m e a s u r e s t h a t would d i a i n i s h d i s t i n c t i o n s between member a n d nonmeaber s t a t u s , which e x i s t p r i m a r i l y v i t h r e s p e c t t o r e s e r v e r e q u i r e m e n t s and a v a i l a b i l i t y of s e r v i c e s from t h e FRS , c o u l d r e s u l t i n c o n v e r s i o n s between s t a t e c h a r t e r s and n a t i o n a l c h a r t e r s . D e c i s i o n s r e g a r d i n g c o n v e r s i o n would d e p e n d i n p a r t on b a n k s ' s e n s i t i v i t i e s t o h a v i n g two l e v e l s o f s u p e r v i s i o n , a s is t h e c a s e w i t h s t a t e c h a r t e r e d i n s u r e d b a n k s , o r o n e l e v e l of The relative s u p e r v i s i o n , a s is t h e case w i t h n a t i o n a l l y c h a r t e r e d b a n k s . importance of t h e v a r i o u s F e d e r a l r e g u l a t o r y a u t h o r i t i e s c o u l d b e a f f e c t e d a s well a s t h e r e l a t i v e p r e s e n c e of federal and s t a t e a u t h o r i t i e s in t h e r e g u l a t i o n and s u p e r v i s i o n of banks, LEGISLATION L e g i s l a t i o n r e l a t i n g t o FRS .em b e r s h i p a n d m o n e t a r y c o n t r o l was i n t r o d u c e d A review of d e v e l o p m e n t s in t h e and c o n s i d e r e d l a t e i n t h e 9 5 t h Congress. 9 5 t h C o n g r e s s a p p e a r s i n the CR S R e p o r t " O v e r s i g h t a n d L e g i s l a t i v e A c t i v i t i e s o f t h e 9 5 t h C o n g r e s s R e l a t i n g t o t h e Planetary P o l i c y F u n c t i o n s o f the F e d e r a l Reserve Systemn, l i s t e d i n t h e r e f e r e n c e s e c t i o n of t h i s i s s u e b r i e f . The 96-227, 9 6 t h C o n g r e s s a d d r e s s e d FRS monetary c o n t r o l i n p r o v i s i o n s of P.L. t h e D e p o s i t o r y I n s t i t u t i o n s Deregulation and Honetary C o n t r o l A c t , enacted a f t e r c o n s i d e r i n g s e v e r a l a l t e r n a t i v e a p p r o a c h e s t o t h e matter, as- 5 P u b l i c Law 96-221 P.L. 96-227 e x t e n d s r e s t r u c t u r e d r e s e r v e r e q u i r e m e n t s t o a l l d e p o s i t o r y f i n a n c i a l i n s t i t u t i o n s o v e r a phase-in p e r i o d t o b e g i n 6 months a f t e r e n a c t m e n t , The s t r u c t u r e o f t h e new r e s e r v e r e q u i r e m e n t s is s u c h t h a t many d e p o s i t o r p i n s t i t u t i o n s a r e a b l e t o f u l f i l l FBS r e s e r v e r e q u i r e m e n t s by n o r m a l h o l d i n g s of v a u l t c a s h o T h e r e is no i n t e r e s t p a i d t o b a n k s on r e s e r v e s h e l d i n f u l f i l l m e n t o f t h e b a s i c reserve r e q n i r e a e n t s . The A c t a l s o g r a n t s t h e FBS t h e power t o i n p c s e s u p p l e m e n t a l r e s e r v e r e q u i r e m e n t s beyond t h e b a s i c r e s e r v e r e q u i r e m e n t s a n d r e q u i r e s i t t o pay interest on s u p p l e m e n t a l r e s e r v e s , By e s t a b l i s h i n g re p o s t i n g r e q u i r e m e n t s f o r a l l d e p o s i t o r y i n s t i t u t i o n s , t h e Act i n c r e a s e s i n f o r m a t i o n a v a i l a b l e t o t h e FRS It a l s o a b o u t r e s e r v e and d e p o s i t p o s i t i o n s o f a l l d e p o s i t o r y i n s t i t u t i o n s . r e q u i r e s t h a t t h e FRS c h a r g e f o r s e r v i c e s p r e v i o u s l y a v a i l a b l e t o melaber b a n k s w i t h o u t c h a r g e a n d makes s u c h s e r v i c e s , i n c l u d i n g access t o b o r r o w i n g f r o m t h e FBS, a v a i l a b l e t o a l l d e p o s i t o r y i n s t i t u t i o n s w i t h t r a n s a c t i o n s accounts. A 1 1 p r o v i s i o n s r e l a t i n g t o monetary c o n t r o l apply uniformly t o d e p o s i t o r y i n s t i t u t i o n s w h e t h e r o r n o t t h e y a r e members of t h e FRS, The t i m i n g f o r f u l l i m p l e a e n t a t i o n v a r i e s a c c o r d i n g t o p r o v i s i o n s of t h e T h e FBS h a s i s s u e d r e g u l a t i o n s f o r e x t e n d i n g r e s t r u c t u r e d r e s e r v e These r e g u l a t i o n s provide f o r requirements t o a l l depository i n s t i t u t i o n s uniform r e s e r v e r e q u i r e n e n t s f o r a l l d e p o s i t o r y i n s t i t u t i o n s . The p hase-in p e r i o d is 4 y e a r s f o r member b a n k s and 8 y e a r s f o r nonmember i n s t i t u t i o n s . B e g i n n i n g i n November 7980, d e p o s i t o r y i n s t i t u t i o n s w i t h $ 2 m i l l i o n o r more i n t o t a l d e p o s i t s became s u b j e c t t o r e s e r v e r e q u i r e m e n t s e s t a b l i s h e d for t h e first y e a r o f t h e phase-in p r o c e s s , The FRS h a s i s s u e d r e g u l a t i o n s , i n f o r c e s i n c e S e p t . 1, 1 9 8 0 , g o v e r n i n g d e p o s i t o r y i n s t i t u t i o n s a a c c e s s t o b o r r o w i n g f r o m t h e FRS. The FRS h a s a l s o i s s u e d a p r o p o s e d s c h e d u l e o f f e e s f o r The f e e s e r v i c e s t o bemade available to a l l depository i n s t i t u t i o n s . s c h e d u l e , t o b e p h a s e d i n d u r i n g 1987, c o v e r s s u c h s e r v i c e s a s c h e c k c l e a r i n g , wire t r a n s f e r s of f u n d s , and t h e u s e o f "f l o a t t q which is c r e d i t t h e FRS e x t e n d s t o b a n k s w h i l e i t p r o c e s s e s c h e c k s f o r c l e a r i n g . - Act-, The reserve r e q u i r e m e n t p r o v i s i o n s o f P.L. 96-221 will, over a 4 - y e a r p e r i o d , low er r e q u i r e m e n t s p r e v i o u s l y i n e f f e c t f o r member b a n k s , and p h a s e - i n r e q u i r e m e n t s f o r i n s t i t u t i o n s n o t p r e v i o u s l y s u b j e c t t o FRS r e s e r v e r e q u i r e m e n t s o v e r an 8 - y e a r period. Effective reserve requirements w i l l n e c e s s a r i l y change o v e r t h e phase-in p e r i o d s , a f t e r which t h e p r o v i s i o n s w i l l apply unif o r n i l y t o a l l depository i n s t i t u t i o n s . The f o l l o w i n g d e s c r i p t i o n of reserve requirement provisions pertains t o arrangements a s they w i l l e x i s t a f t e r t h e phase-in p e r i o d s . The A c t p r o v i d e s f o r b a s i c r e s e r v e requirements f o r two c l a s s e s of d e p o s i t s , t r a n s a c t i o n s d e p o s i t s a n d n o n - p e r s o n a l time deposits F o r t r a n s a c t i o n s d e p o s i t s which i n c l u d e s u c h a c c o u n t f o m s a s c h e c k i n g , NOW, s h a r e d r a f t s a n d a c c o u n t s w i t h ATS a r r a n g e m e n t s , t h e r e s e r v e r e q u i r e m e n t , a p p l i c a b l e t o d e p o s i t s h e l d b y an i n d i v i d u a l i n s t i t u t i o n i n The FRS c a n a d j u s t t h e l e v e l o f t h i s e x c e s s o f $ 2 5 m i l l i o n , is 12%. A r e q u i r e m e n t w i t h i n a r a n g e of 8 % t o 14% f o r m o n e t a r y c o n t r o l p u r p o s e s . r e s e r v e r e q u i r e m e n t o f 3% is imposed on t h e f i r s t $ 2 5 m i l l i o n of t r a n s a c t i o n s a c c o u n t s in a n i n d i v i d u a l i n s t i t u t i o n . The FBS is a u t h o r i z e d t o e s t a b l i s h a s u p p l e m e n t a l r e s e r v e r e q u i r e m e n t u p t o 4% a p p l i c a b l e t o t r a n s a c t i o n s a c c o u n t s o n l y a n d is r e q u i r e d t o p a y i n t e r e s t on s u p p l e m e n t a l r e s e r v e s a t t h e r a t e i t e a r n s on i t s own p o r t f o l i o . A separate r e s e r v e requirement is imposed on " n o n p e r s o n a l t i m e d e p o s i t s N s u c h a s $700 , 0 0 0 n e g o t i a b l e c e r t i f i c a t e s o f deposit, T h i s is s e t i n i t i a l l y a t 3% w i t h a r a n g e o f 0 t o 9%. . CBS- 6 UPDATE-0 1/7 2 1 8 7 fB7 9047 Legislation considered p r i o r t o conference agreeaent P u b l i c L a w 96-221 e v o l v e d from c o n f e r e n c e i n c o r p o r a t e d p r o v i s i o n s i n i t i a l l y p a s s e d by t h e H.B. 7 provided f o r voluntary Control A c t . r e q u i r e m e n t s t o b e imposed on a m b e r b a n k s o n l y . s h a r e of t o t a l d e p o s i t s i n t h e banking system r e s s v e r e q u i r e m e n t s v e r e t o be a l t e r e d a n d i n s t i t u t i o n s offering transact ions accounts. ' a c t i o n on H.R. 4986 which House a s H .R 7, t h e Monetary FRS laembership a n d r e s e r v e I f , however, member b a n k s a were t o f a l l below 67 -596, imposed on a l l d e p o s i t o r y . H,B, 7 p r o v i d e d f o r r e s e r v e r a t i o s o f 3% t o 11% t o a p p l y i n i t i a l l y t o a l l t r a n s a c t i o n s a c c o u n t s less t h a n a n d g r e a t e r t h a n $35 m i l l i o n r e s p e c t i v e l y ; t h e FBS would have h a d t h e a u t h o r i t y t o a l t e r t h e l a t t e r r a t i o b e t w e e n 4% a n d 12%. If t h e 67.5% t r i g g e r - p o i n t were r e a c h e d , a n d r e s e r v e r e q u i r e m e n t s t h e r e q u i r e d r e s e r v e r a t i o on e x t e n d e d t o all d e p o s i t o r y i n s t i t u t i o n s , A t r a n s a c t i o n s a c c o u n t s less t h a n $35 l a i l l i o n would h a v e b e e n s e t a t z e r o . f l o o r amendment p r o v i d e d f o r exempting t e l e p h o n e t r a n s f e r a c c o u n t s f r o m r e s e r v e r e q u i r e m e n t s o n l y if s i x o r fewer t r a n s a c t i o n s were made p e r month. The amended b i l l would h a v e imposed n o i n i t i a l r e s e r v e r e q u i r e m e n t o n time a n d s a v i n g s d e p o s i t s , b u t would h a v e g i v e n t h e FRS t h e p o u e r t o s e t a r e q u i r e m e n t , up t o 8 % , f o r s h o r t - t e r m , n o n p e r s o n a l time d e p o s i t s a b o v e $300,000 a n d f o r E u r o d o l l a r l i a b i l i t i e s . . H.B. 7 a l s o p r o v i d e s f o r i n c r e a s e d i n f o r m a t i o n f o r t h e FRS a b o u t r e s e r v e It a l s o i n c l u d e d a n d d e p o s i t p o s i t i o n s of a l l d e p o s i t o r y i n s t i t u t i o n s . p r i n c i p l e s f o r a p r i c i n g s y s t e m f o r PRS s e r v i c e s t o b e made a v a i l a b l e t o all depository institutions. On Nov. 7, 1979, t h e S e n a t e Committee on Banking, Housing and Urban A f f a i r s met t o c o n s i d e r S 85 ( P r o x m i r e ) , S Amend. 398 ( P r o x m i r e ) and S. 353 . (Tower), b i l l s r e l a t i n g t o F e d e r a l R e s e r v e membership a n d m o n e t a r y c o n t r o l . B e f o r e r e c e s s i n g , t h e Committee v o t e d t o s u b s t i t u t e S . 353 f o r S . 8 5 a s a b a s i s o n which t o c o n t i n u e its c o n s i d e r a t i o n o f l e g i s l a t i o n i n t h i s a r e a . S, 8 5 and S, Amend. 398. provided f o r applying restructured reserve requirements t o a l l depository institutions. T h i s amended b i l l p r o v i d e d f o r i n c r e a s e d r e s e r v e a n d d e p o s i t i n f o r m a t i o n t o b e t r a n s n i t t e d frau a l l d e p o s i t o r y i n s t i t u t i o n s t o t h e FRS a n d f o r a c c e s s t o PBS s e r v i c e s by a l l d e p o s i t o q i n s t i t u t i o n s a c c o r d i n g t o a f e e s c h e d u l e b a s e d on s p e c i f i e d pricing principles. S. 353 w i t h amendments 7642 t h r o u g h 1 6 4 4 , o f f e r e d by S e n a t o r Tower, s o u g h t t o p r o m o t e more e x t e n s i v e FRS r e s e r v e r e q u i r e m e n t c o v e r a g e by e n h a n c i n g t h e a t t r a c t i v e n e s s of a f f i l i a t i o n w i t h t h e FRS. I t would n o t have mandated s u c h It provided f o r r e s t r u c t n r i n g an affiliation f o r depository institutions. and l o w e r i n g FRS r e s e r v e r e q u i r e m e n t s and f o r t h e payment of i n t e r e s t on r e q u i r e d r e s e r v e b a l a n c e s h e l d w i t h t h e FRS. I n t e r e s t p a y m e n t s were t o b e set a t 112 p e r c e n t a g e p o i n t below t h e FBS's e a r n i n g r a t e o n i t s p o r t f o l i o of securities. F o r nonmember d e p o s i t o r y i n s t i t u t i o n s m e e t i n g FBS reserve r e q u i r e a e n t s , i t would h a v e made FBS s e r v i c e s a v a i l a b l e on t h e same b a s i s a s S . 353 w i t h amendments p r o v i d e d f o r i n c r e a s e d r e s e r v e and f o r melaber banks. d e p o s i t i n f o r m a t i o n t o be t r a n s m i t t e d from a l l d e p o s i t o r y i n s t i t u t i o n s t o t h e FRS and f o r t h e FRS t o o f f e r s e r v i c e s a t p r i c e s s e t a c c o r d i n g t o s p e c i f i e d pricing principles . Additional l e g i s l a t i o n Under p r o v i s i o n s o f t h e H o n e t a r y C o n t r o l Act, most differences between CBS- 7 I B 7 90 47 UPDATE4 1/12/8 1 member a n d nonmember d e p o s i t o r y i n s t i t u t i o n s a s t h e y r e l a t e t o m m e t a r y c o n t r o l a r r a n g e m e n t s w i l l d i s a p p e a r . The F e d e r a l R e s e r v e H o d e r n i z a t i o n A c t , H .B 700 1 ( B e u s s ) , would f u r t h e r d i m i n i s h d i f f e r e n c e s by e l i m i n a t i n g t h e r o l e o f member b a n k s i n s e l e c t i n g c e r t a i n o f f i c i a l s c h a r g e d w i t h r e s p o n s i b i l i t i e s f o r f orrn u l a t i n g m o n e t a r y p o l i c y . . m d e r c u r r e n t p r o v i s i o n s o f t h e F e d e r a l R e s e r v e Act, m e m b e r b a n k s own s t o c k i n t h e F e d e r a l E e s e r v e bank of t h e d i s t r i c t i n which t h e y a r e l o c a t e d . E a r n i n g s on s u c h s t o c k is l i m i t e d t o 6% p e r y e a r . Accompanying s t o c k ownership a r e v o t i n g r i g h t s which, indirectly, give member banks r e p r e s e n t a t i o n i n t h e f o r m u l a t i o n of m o n e t a r y p o l i c ~ . Hember b a n k s select s i x o f t h e n i n e d i r e c t o r s of e a c h r e g i o n a l F e d e r a l R e s e r v e bank. The p r e s i d e n t o f e a c h of t h e F e d e r a l R e s e r v e b a n k s is a p p o i n t e d by i t s b o a r d of d i r e c t o r s , s u b j e c t t o a p p r o v a l by t h e Board of G o v e r n o r s o f t h e FBS. Five of t h e t w e l v e r e g i o n a l F e d e r a l R e s e r v e bank p r e s i d e n t s s e r v e on t h e F e d e r a l Open H a r k e t C o m m i t t e e (FOHC) w i t h s e v e n members o f t h e Board o f G o v e r n o r s of the FBS. T h e FO8C e s t a b l i s h e s p o l i c y f o r FRS o p e n m a r k e t o p e r a t i o n s , the p r i n c i p a l t o o l f o r c o n d u c t i n g monetary p o l i c y . H.R. 7 0 0 1 p r o v i d e s f o r t h e Board of G o v e r n o r s o f t h e PRS t o p e r f o m t h e f u n c t i o n s c u r r e n t l y c a r r i e d o u t bp t h e FOHC. Federal Reserve bank p r e s i d e n t s , i n s t e a d o f b e i n g e l i g i b l e t o s e r v e on t h e F O X , would c o m p r i s e a F e d e r a l A d v i s o r y C o u n c i l , empowered t o c o n s u l t w i t h t h e Board of G o v e r n o r s onm o n e t a r y a n d r e s e r v e b a n k i n g matters. A n o t h e r p r o v i s i o n o f the b i l l would r e q u i r e t h e FRS t o r e d u c e t h e g r o w t h r a t e of money, following prescribed o n e - y e a r g r o w t h r a t e r a n g e s , t o a c h i e v e a l o w e r and s t a b l e g r o w t h r a t e a f t e r a p e r i o d of 3 t o 4 p e a r s . LEGISLATION P.L. 96-221 D e p o s i t o r y I n s t i t u t i o n s D e r e g u l a t i o n a n d Honetary C o n t r o l A c t of 1980. On Nov. 7 , 1979, t h e House p a s s e d a v e r s i o n o f t h i s b i l l s u b s e q u e n t t o amendments by t h e S e n a t e . The House a c t i o n i n c o r p o r a t e d p r o v i s i o n s o f H.R. 7 , t h e Monetary C o n t r o l A c t . F o l l o w i n g c o n f e r e n c e a c t i o n on Mar. 4-5, 1980, m o d i f y i n g t h e l e g i s l a t i o n , i t was e n a c t e d a n d signed i n t o law as P.L. 96-221 o n Har. 37, 1980. H.B. 7 (Reuss) H o n e t a r y C o n t r o l Act o f 7979. F a c i l i t a t e s t h e implementation of m o n e t a q p o l i c y a n d t o p r o m o t e c o m p e t i t i v e e q u a l i t y among d e p o s i t o r y i n s t i t u t i o n s . I n t r o d u c e d J a n . 1 5 , 1979: r e f erred t o C o m m i t t e e on B a n k i n g , F i n a n c e and Urban A f f a i r s . H e a r i n g s h e l d J a n . 22 and 2 4 , Feb, 13 a n d 15, Har. 2 and 5, and J u n e 4, 1979. R e p o r t e d t o t h e House, a s amended, J u n e 7 1 , 1 9 7 9 (H.Rept. 96-263). H.R. 7 was f u r t h e r amended a n d p a s s e d by t h e House by a v o t e o f 340 7 as p a s s e d by t h e House were t o 20 on J u l y 20, 1979. P r o v i s i o n s o f H.R. i n c o r p o r a t e d i n t o H.S. 4986 a s p a s s e d by t h e House on Nov. 7 , 1979. H O B . 418 (Hansen) F a c i l i t a t e s t h e i m p l e m e n t a t i o n of F e d e r a l R e s e r v e A c t Amendments of 7979. m o n e t a r y p o l i c y a n d p r o m o t e s c o m p e t i t i v e e q u a l i t y among c o m m e r c i a l b a n k s . I n t r o d u c e d J a n . 1 5 , 7979: r e f e r r e d t o C o m m i t t e e on B a n k i n g , F i n a n c e and Urban A f f a i r s . H.R. 2733 ( S t a n t o n ) CBS- 8 IB7 90 47 UPDATE-* 1/1 2/8 I Reserve Requirement S i m p l i f i c a t i o n A c t of 1979. Amends t h e F e d e r a l R e s e r v e A c t t o r e d u c e c e r t a i n r e s e r v e r e q u i r e l n e n t s t o f a c i l i t a t e the i m p l e m e n t a t i o n of m o n e t a r y p o l i q , a n d f o r o t h e r p u r p o s e s . I n t r o d u c e d Feb. 13, 1 9 7 9 , r e f e r r e d t o Committee on Banking, F i n a n c e a n d Urban Affairs. H-B, 7 0 0 1 (Beuss) Amends t h e F e d e r a l R e s e r v e A c t t o F e d e r a l Reserve llodernization A c t . r e t i r e F e d e r a l R e s e r v e bank s t o c k and t o p l a c e r e s p o n s i b i l i t i e s f o r o p e n a a r k e t o p e r a t i o n s w i t h t h e B o a r d o f G o v e r n o r s of t h e FBS, I n t r o d u c e d Apr. 1, 1980: referred t o C o m m i t t e e o n B a n k i n g , F i n a n c e a n d Urban A f f a i r s . Hearings h e l d n a y 15, 1980. Amended a n d r e p o r t e d b y t h e S u b c o m m i t t e e o n D o m e s t i c R o n e t a r y P o l i c y t o t h e Commitee on S e p t . 1 0 , 1380. S, 85 (Proxmire) Y o n e t a r y p o l i c y Improvement A c t o f 1979. Amends t h e F e d e r a l R e s e r v e A c t t o p r o v i d e f o r m a i n t e n a n c e o f r e s e r v e s t o f a c i l i t a t e t h e i m p l e m e n t a t i o n of m o n e t a r y p o l i c y , p r o m o t e s c o m p e t i t i v e e q u a l i t y among d e p o s i t o r y i n s t i t u t i o n s , r e q u i r e s t h e i m p o s i t i o n o f s e r v i c e c h a r g e s f o r s e r v i c e s by F e d e r a l R e s e r v e 18, 1979; r e f e r r e d t o banks, and f o r o t h e r purposesIntroduced Jan. C o m m i t t e e o n B a n k i n g , Housing and Urban A f f a i r s . H e a r i n g s h e l d Feb. 26, Har. 26-28, Bay 1 4 , and S e p t - 26-27, 1979. S-Amend, 398 ( P r o x m i r e ) , i n t r o d u c e d 85, m o r l i f i e s S e p t . 5, 1 9 7 9 a s a s u b s t i t u t e for t h e o r i g i n a l t e x t of S. 85 at the c e r t a i n p r o v i s i o n s o f t h a t b i l l - S. 353 was s u b s t i t u t e d f o r S. i n i t i a l Committee mark-up s e s s i o n Nov. 7, 1979, A d d i t i o n a l h e a r i n g s were h e l d on Feb. 4-5, 1 9 8 0 S. 353 (Tower) F e d e r a l R e s e r v e M o d e r n i z a t i o n A c t o f 1979. F a c i l i t a t e s t h e development r e d u c e s and r e s t r u c t u r e r e s e r v e a n d i m p l e m e n t a t i o n of m o n e t a r y p o l i c y ; r e q u i r e s e n t s ; and p r o v i d e s f o r t h e m a i n t e n a n c e o f r e s e r v e s by member b a n k s and o t h e r d e p o s i t o q i n s t i t u t i o n s i n E a r n i n g s P a r t i c i p a t i o n Accounts a t t h e 6, 1979: referred t o Senate F e d e r a l R e s e r v e Banks. I n t r o d u c e d Feb. C o a m i t t e e o n BanKing, Housing and Urban A f f a i r s . H e a r i n g s h e l d Peb. 26, Mar. 26-28, Clay 1 4 , and S e p t . 26-27, 7979. S. 3 5 3 was s u b s t i t u t e d f o r S - 85 a t t h e i n i t i a l C o m m i t t e e mark--up s e s s i o n h e l d Nov. 7 , 1979. S . Anends 1642 Additional hearings t h r o u g h 1644 (Tower) were i n t r o d u c e d on J a n . 3 0 , 7980. were h e l d o n Feb. 4-5, 1980- Provides f o r t h e payment o f i n t e r e s t on r e s e r v e s h e l d i n F e d e r a l banks. I n t r o d u c e d Apr. 1 0 , 1 9 7 9 ; r e f e r r e d t o Committee on B a n k i n g , a n d U r b a n Affairs. O.S. Reserve Housing Congress. E o n s e , C o m m i t t e e on B a n k i n g , F i n a n c e and Urban Affairs. Honetary C o n t r o l . [H.R. 7 3 H e a r i n g s , 9 6 t h C o n g r e s s , 1st s e s s i o n . Washington, U.S. Govt. P r i n t , O f f . , 1979. 865 p . H e a r i n g s h e l d J a n . 22, 2 4 ; Feb. 13, 75, 2 8 ; Mar. 2 and 5, 7979. ' ---- Honetary Control. [ H . B - 7 3 H e a r i n g s , 9 6 t h C o n g r e s s , 1st session. V a s h i n g t o n , U S . Govt. P r i n t . O f f . , 1 9 7 9 - 1 6 p . H e a r i n g s h e l d J u n e 4 , 1979. ---U.S, ---- To M o d e r n i z e t h e F e d e r a l R e s e r v e S y s t e m . [H.R. 7001) Hearings, 9 6 t h C o n g r e s s , 2d s e s s i o n . Washing t o n , U. S. Gov t. P r i n t , Off , 1980. 96 p. H e a r i n g s h e l d Hay 15, 1980. . - Congress. S e n a t e . Committee on B a n k i n g , H o u s i n g a n d H o n e t a s p P o l i c y I m p r o v e m e n t Act of 1979. Urban A f f a i r s [ S- 8 s and S , 353 1 B e a r i n g s , 9 6 t h C o n g r e s s , 1st s e s s i o n . U a s h i n g t o n , U.S. G o v t , P r i n t . Off 1979. 1107 p a H e a r i n g s h e l d Feb, 26, Mar. 26, 27, 28 and Hay 14, 7979, ., F e d e r a l R e s e r v e Hembership. [ Amend. N o . 398 t o S. 85 a n d S. H e a r i n g s , 96 t h C o n g r e s s , 1st s e s s i o n . W a s h i n g t o n , U .S Govt. Print. O f f 1979. 188 p B e a r i n g s h e l d S e p t . 26 a n d 27, 1 9 7 9 . ., . - --- F e d e r a l R e s e r v e R e q u i r e m e n t s . [ S. 35 3 and P r o p o s e d Amends., S o 8 5 and H.B. 7 3 B e a r i n g s , 9 6 t h C o n g r e s s , 2d s e s s i o n . U a s h i n g t o n , U .S. Govt. P r i n t . Off., 1980, 224 p. H e a r i n g s h e l d Feb, 4 a n d 5, 1980 - U.S. Congress. House. Committee on B a n k i n g , F i n a n c e and Urban Affairs. D e s c r i p t i o n o f t h e laonetary c o n t r o l b i l l ( t o b e Dee 1978. Washington, i n t r o d u c e d i n t h e 96th Congress) .U.S. Govt. P r i n t . O f f . , 1978. 65 p . A t head of t i t l e : 9 5 t h C o n g r e s s , 2d s e s s i o n . Committee p r i n t . . - -pH.B. 7: t o facilitate t h e implementation o l i c ~and t o p r o m o t e c o m p e t i t i v e e q u a l i t y . . of m o n e t a r y among d e p o s i t o r y Washing t o n , O S , Govt , . i n st i t n t i o n s Apr 12, 19 79. P r i n t . O f f . , 1979. 33 pA t head of t i t l e : 9 6 t h C o n g r e s s , 1st s e s s i o n . C o m ~ i t t e ep r i n t . -Haterials r e l a t i n g t o p r o p o s e d amendment i n t h e n a t u r e o f a s u b s t i t u t e f o r H . R . 7. Hay 1979. W a s h i n g t o n , U.S. Govt. P r i n t . Off., 1979. 4 1 p. A t head o f t i t l e : 9 6 t h C o n g r e s s , 1st s e s s i o n . Committee print. -p H.o l Ri c. y 7:and t ot o f ap rcoiml iottae t ce otahpee tiimt ipvl ee meeqnut aa tl iiot ny institutions. Hay 22, 1979. 35 p. A t head o f t i t l e : 96th Congress, print. of m o n e t a r y among d e p o s i t o r y 1st session -s uHpopnl ee tmaeqn tCa ol ,n tar do dl iAct o f 1979; r e p o r t t o g e t h e r t i o n a l , and d i s s e n t i n g v i e w s . Committee with minority, t o accompany H.R. 7. J u n e 11, 1979. W a s h i n g t o n , U .S. Govt. P r i n t . O f f 1 9 7 9 , 51 p. ( 9 6 t h C o n g r e s s , 1st s o s s i o n . House. R e p o r t no. 96-263) ., 353 ] -- D e p o s i t o r y I n s t i t u t i o n s D e r e g u l a t i o n and f l o n e t a r y C o n t r o l A c t ; C o n f e r e n c e R e p o r t t o accompany 8.8. 4986. flar. 2 1 , 1980. (96th Washington, U . S . Govt. P r i n t . O f f , , 7980. 85 p. C o n g r e s s , 2d s e s s i o n . House, R e p o r t no 96-842) - O.S. Congress. S e n a t e , Committee on B a n k i n g , H o u s i n g a n d Urban Affairs. Summarp of t h e H o n e t a r y P o l i c y Improvement Act of 7979 ( t o b e i n t r o d u c e d i n t h e 9 6 t h C o n g r e s s ) . U.S, Govt. P r i n t . O f f . , 1979. 183 p. R a s h i n g t o n , D.C., A t head o f t i t l e : 9 5 t h C o n g r e s s , 2d s e s s i o n . Committee p r i n t . -CDoenpf oe rseint oc er 7Report I n s t i t u t i o n s D e r e g u l a t i o n and t o accompany H,R. 4986. Planetary c o n t r o l Act ; Has, 2 7 , 1980 R a s h i n g t o n , U . S . Govt:Print. Off., 1980. 8 5 p. (96th C o n g r e s s , 2d s e s s i o n , S e n a t e . R e p o r t no. 9 6 6 4 0 ) . ------------------ ADDITIONAL BEPERENCZ SOURCES 0.S. --- L i b r a r y of Congress. I m p l i c a t i o n s of t h e D e p o s i t o q ~ n s t i t n t i o n s D e r e g u l a t i o n and H o n e t a r y C o n t r o l Act f o r r e s t r u c t u r i n g the F e d e r a l R e s e r v e System. [ b y ) Roger S. Whit , J a n u a r y 12 ,. 1987. ( R a s h i n g t o n ] 1981. 8 p , CES Typed R e p o r t Ha jor L e g i s l a t i o n i n t h e 9 6 t h C o n g r e s s in the f i e l d o f Honey and Banking: P .L. 96-221, D e p o s i t o r y I n s t i t u t i o n s and D e r e g u l a t i o n and Monetary C o n t r o l Act of 1980 [ b y ] P. J e a n Wells. J u n e 3, 1980, 8 p . CRS 8 e p o r t 80-107E -OMoney D e f i n i t i o n s , Monetary P o l i c y , and C o n g r e s s i o n a l versight. [ by] Roger S. U h i t e . [ Washington 1 7980. CBS Issue Brief I B 80017. ------ P e r i o d i c a l l y updated. O v e r s i g h t a n d l e g i s l a t i v e a c t i v i t i e s of t h e 9 5 t h C o n g r e s s r e l a t i n g t o t h e m o n e t a r y p o l i c y f u n c t i o n s of t h e F e d e r a l B e s e r v e Systenr ( b y ] Roger S . U h i t e a n d P a u l i n e S a a l e , J a n . 2 , 1 9 7 9 , ( R a s h i n g t o n ] 1979. 17 p. . B e g u l a t i o n Q and I n t e r e s t on D e p o s i t s , ( b y ] W i l l i a m J a c k s o n . [ Washington ) 1980. CBS Issue Brief I B 80056, P e r i o d i c a l l y u p d a t e d .