|For immediate release|
Preliminary figures indicate that operating income of the Federal Reserve Banks amounted to $28.147 billion during 1998. Net income before payment of dividends, additions to surplus, and payments to the Treasury totaled $27.623 billion. About $26.549 billion of this net income was distributed to the U.S. Treasury during 1998.
Federal Reserve System income is derived primarily from interest earned on U.S. government securities that the Federal Reserve has acquired through open market operations. Income from the provision of financial services amounted to $817.1 million.
Operating expenses of the 12 Reserve Banks and branches totaled $1.785 billion. In addition, earnings credits in the amount of $347.5 million were granted to depository institutions under the Monetary Control Act of 1980. Assessments to Reserve Banks for Board expenditures totaled $178 million and the cost of currency amounted to $408.5 million.
Net additions to income amounted to $1.915 billion, resulting primarily from unrealized gains on assets denominated in foreign currencies revalued to reflect current market exchange rates. Statutory dividends to member banks were $343 million.
Under the policy established by the Board of Governors at the end of 1964, all net income after the statutory dividend to member banks and the amount necessary to equate surplus to paid-in capital is transferred to the U.S. Treasury.
1999 Other announcements