Federal Reserve Bulletin

Profits and Balance Sheet Developments at U.S. Commercial Banks in 2005

Figure 23. Interest-payment ratio for businesses, and financial obligations ratio for households, 1990-2005. Data plotted as curves. Two panels. In the top panel, the interest-payment ratio for nonfinancial corporations begins at about 20 percent in 1990, generally falls to reach about 11 percent in 1997 and 1998, rises to about 17 percent in late 2001, then generally falls to reach about 10 percent at the end of 2005. In the bottom panel, the financial obligations ratio for households starts in 1990 at about 17 percent, falls to reach about 16 percent in 1993, then generally rises to about 18.5 percent in late 2001, generally falls to about 18 percent by late 2004, and ends at about 18.5 percent in 2005.

Note: The data are quarterly. The interest-payment ratio is calculated as interest payments as a percentage of cash flow. The financial obligations ratio is an estimate of debt payments and recurring obligations as a percentage of disposable personal income; debt payments and recurring obligations consist of required payments on outstanding mortgage debt, consumer debt, auto leases, rent, homeowner's insurance, and property taxes.

Source: For interest-payment ratio, national income and product accounts and Federal Reserve Board; for financial obligations ratio, Federal Reserve Board (www.federalreserve.gov/releases/housedebt).  Return to article