106th Annual Report 2019 B O A R D O F G O V E R N O R S O F T H E F E D E R A L R E S E R V E S YSTEM Frontmatter 106th Annual Report 2019 B O A R D O F G O V E R N O R S O F T H E F E D E R A L R E S E R V E S YSTEM This and other Federal Reserve Board reports and publications are available online at https://www.federalreserve.gov/publications/default.htm. To order copies of Federal Reserve Board publications offered in print, see the Board’s Publication Order Form (https://www.federalreserve.gov/files/orderform.pdf) or contact: Printing and Fulfillment Mail Stop K1-120 Board of Governors of the Federal Reserve System Washington, DC 20551 (ph) 202-452-3245 (fax) 202-728-5886 (email) [email protected] v Contents 1 Overview ................................................................................................................................. 1 About the Federal Reserve System ............................................................................................... 2 2 Monetary Policy and Economic Developments ........................................................ 3 Monetary Policy Report February 2020 .......................................................................................... 3 Monetary Policy Report July 2019 ............................................................................................... 20 3 Financial Stability ............................................................................................................. 33 Monitoring Risks to Financial Stability ......................................................................................... 33 Domestic and International Cooperation and Coordination ........................................................... 39 4 Supervision and Regulation ........................................................................................... 41 Supervised and Regulated Institutions ......................................................................................... 41 Supervisory Developments ......................................................................................................... 43 Regulatory Developments ........................................................................................................... 54 5 Payment System and Reserve Bank Oversight ........................................................ 57 Payment Services to Depository and Other Institutions ................................................................ 57 Currency and Coin ..................................................................................................................... 60 Fiscal Agency and Government Depository Services .................................................................... 61 Evolutions and Improvements to the System ............................................................................... 63 Oversight of Federal Reserve Banks ............................................................................................ 65 Pro Forma Financial Statements for Federal Reserve Priced Services ........................................... 69 6 Consumer and Community Affairs ............................................................................. 75 Supervision and Examinations .................................................................................................... 75 Consumer Laws and Regulations ................................................................................................ 83 Consumer Research and Analysis of Emerging Issues and Policy ................................................. 84 Community Development ........................................................................................................... 85 Appendixes ............................................................................................................................ 89 A Federal Reserve System Organization ....................................................................... 91 Board of Governors ................................................................................................................... 91 Federal Open Market Committee ............................................................................................... 97 Board of Governors Advisory Councils ....................................................................................... 98 Federal Reserve Banks and Branches ...................................................................................... 102 vi B Minutes of Federal Open Market Committee Meetings ................................... 121 Meeting Held on January 29–30, 2019 ...................................................................................... 122 Meeting Held on March 19–20, 2019 ........................................................................................ 144 Meeting Held on April 30–May 1, 2019 ..................................................................................... 174 Meeting Held on June 18–19, 2019 .......................................................................................... 188 Meeting Held on July 30–31, 2019 ........................................................................................... 217 Meeting Held on September 17–18, 2019 ................................................................................. 233 Meeting Held on October 29–30, 2019 ..................................................................................... 265 Meeting Held on December 10–11, 2019 .................................................................................. 283 C Federal Reserve System Audits .................................................................................. 313 Office of Inspector General Activities ........................................................................................ 314 Government Accountability Office Reviews ............................................................................... 315 D Federal Reserve System Budgets ............................................................................... 317 System Budgets Overview ....................................................................................................... 317 Board of Governors Budgets ................................................................................................... 319 Federal Reserve Banks Budgets .............................................................................................. 324 Currency Budget ..................................................................................................................... 329 E Record of Policy Actions of the Board of Governors ....................................... 333 Rules and Regulations ............................................................................................................. 333 Policy Statements and Other Actions ....................................................................................... 339 Discount Rates for Depository Institutions in 2019 .................................................................... 340 Regulatory Developments ........................................................................................................ 341 The Board of Governors and the Government Performance and Results Act .............................. 348 F Litigation ........................................................................................................................... 349 Pending .................................................................................................................................. 349 Resolved ................................................................................................................................ 349 G Statistical Tables ............................................................................................................. 351 H Index ................................................................................................................................... 381 1 1 Overview This report covers the calendar-year 2019 operations and activities of the Federal Reserve, the central bank Federal Reserve Response of the United States, categorized in the five key func- to COVID-19 tional areas: Since this report covers only Federal Reserve 2019 operations and activities, it does not include informa- • Conducting monetary policy and monitoring eco- tion on our response to the COVID-19 pandemic. For nomic developments. Section 2 provides adapted more detail on our response to the pandemic, visit versions of the Board’s semiannual Monetary the Board’s website at https://www.federalreserve .gov/covid-19.htm. Policy Reports to Congress. Highlights in 2019 include  detailed assessments of both economic develop- • Fostering payment and settlement system safety and ments and Federal Reserve monetary policy efficiency. Section 5 describes actions by the Board activities and Reserve Banks to promote the effectiveness of the nation’s payment systems, discusses initiatives  a review of the Federal Reserve’s strategic frame- to promote payment system safety, and provides work for monetary policy data on Reserve Bank services and income. High- • Promoting financial system stability. Section 3 lights in 2019 include reviews Board and System activities and research  plans to develop the FedNow Service to support undertaken to foster a resilient and stable financial faster payments in the United States system. Highlights in 2019 include  research, technical experimentation,