Federal Reserve Reports Decreased Income, Sends $75B to Treasury

by devteam March 22nd, 2012 | Share

The Federal Reserve Banks reported net income in 2011 of $78.54 billionrncompared to $81.735 billion in 2010. rnTotal comprehensive income, after adjustments for prior services costsrnand actuarial losses related to benefit plans was $77.38 billion, down from $81.74rnbillion.  Of this, $75.42 billion wasrnpaid to the U.S. Treasury as interest on Federal Reserve notes.  In 2010, $79,268 was paid to Treasury.</p

Total interest income for the year was $87.98 billion, 38.28 billion ofrnwhich was from federal agency and government sponsored enterprise (GSE) mortgage-backedrnsecurities (MBS).  In 2010 the totalrninterest income was $82.93 billion, $44.84 of which was from MBS.  Interest Expense totaled $4.1 billion for thernyear resulting in net interest income of $83.88 billion against $79.87 billionrnin 2010.</p

Non-interest income for the year was $50 million compared to $6.89 billionrnin 2010 due largely to a $4 billion loss on consolidated variable interestrnentities which generated $8.18 billion in income in 2010.</p

Total operating expenses for 2011 were $5.39 billion compared to $5.07rnbillion in 2010.</p

Total Reserve Bank assets as of December 31, 2011, were $2.919 trillion,rnwhich represents an increase of $491 billion from the previous year. Holdingsrnof U.S. Treasury securities increased by $683 billion, GSE debt securitiesrnholdings decreased by $45 billion, and federal agency and GSE MBS holdingsrndecreased by $156 billion. The balances held under central bank liquidity swaprnarrangements increased by $99.7 billion. </p

Federal Reserve Bank assets related to credit and liquidity programsrndecreased by $95.8 billion including $47 billion from closing of the AmericanrnInternational Group, Inc. (AIG) recapitalization plan inclusive of the fullrnrepayment of the revolving line of credit with AIG in the amount of $20.6rnbillion and the redemption or sale of the Federal Reserve Bank of New York’srn(FRBNY) preferred interests in two AIG-related LLCs in the amount of $26.4rnbillion. </p

The complete financial statement as well as statements from the 12 FederalrnReserve Banks can be reviewed at

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About the Author


Steven A Feinberg (@CPAsteve) of Appletree Business Services LLC, is a PASBA member accountant located in Londonderry, New Hampshire.

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