For Release at
4:30 P.M. Eastern time
H.3 (502)																												February 27, 2003

SPECIAL NOTICE

	Data on reserves and the monetary base have been revised to reflect the results of annual reviews of seasonal factors and break 
factors. Revisions due to reestimated seasonal factors start in August 1998, and they are the major source of the revisions to the data. 
Revisions due to reestimated break factors begin in January 2002 and do not exceed $17 million in any maintenance period. The maximum 
revision to the monetary base (table 1) in any maintenance period was $1.0 billion; most of these revisions were less than $500 million. 
The maximum revision to total reserves, nonborrowed reserves, and required reserves (also in table 1) in any maintenance period was $750 
million; most of these revisions were also less than $500 million.

	Break factors remove discontinuities (or "breaks") associated with regulatory changes in reserve requirements, such as the annual 
indexations of the low-reserve tranche and the reserve requirement exemption.1 Seasonal factors for required reserves and the surplus 
vault cash component of the monetary base have been reestimated with the revised break-adjusted data.

	A more detailed description of the methods for constructing break factors and seasonal factors is available under "Annual Review 
of Break and Seasonal Factors" on the Federal Reserve's web site (http://www.federalreserve.gov/releases/h3/hist/). Historical data, updated
each week, are available there as well. For paid electronic access to current and historical data, call STAT-USA at 1-800-782-8872 or 
202-482-1986.
	
	1. The Monetary Control Act of 1980 established a reserve ratio of 3 percent against the first $25 million in net transaction 
deposits (low-reserve tranche) at each depository institution. Since 1982, the low-reserve tranche has been indexed each January by 80 
percent of the previous year's (June 30 to June 30) growth rate of net transaction deposits at all depository institutions. At present, 
the low-reserve tranche is $42.1 million.

	Under the Garn-St Germain Depository Institutions Act of 1982, the first $2 million of reservable liabilities of each depository 
institution was exempted from reserve requirements. Since 1983, this exemption amount has been indexed each year by 80 percent of the rate of 
increase of the reservable liabilities at all depository institutions over the preceding year (June 30 to June 30). At present, the reserve 
exemption level is $6.0 million.

	Both of these indexations take effect each year in the reserve maintenance period that includes January 1 for weekly respondents 
to the FR 2900 report.


FEDERAL RESERVE STATISTICAL RELEASE
  
 H.3 (502)
 Table 1                                                                                                 For Release at 4:30 p.m. Eastern Time
                                                                                                                      February 27, 2003
 AGGREGATE RESERVES OF DEPOSITORY INSTITUTIONS AND THE MONETARY BASE
 Adjusted for changes in reserve requirements1                                                                                              
 Averages of daily figures, seasonally adjusted unless noted otherwise
 Millions of dollars

 1. Reserves and monetary base figures incorporate adjustments for discontinuities, or "breaks", associated with regulatory changes in reserve 
    requirements. (For more information, see Table 3).
 2. Seasonally adjusted, break-adjusted total reserves equal seasonally adjusted, break-adjusted required reserves plus unadjusted excess 
    reserves. (Also, see footnote 2 on Table 2 and footnote 2 on Table 3.)
 3. Seasonally  adjusted, break-adjusted nonborrowed reserves equal seasonally adjusted, break-adjusted total reserves less unadjusted total
    borrowings of depository institutions from the Federal Reserve.
 4. Excess reserves NSA equals unadjusted total reserves (Table 2, column 1) less adjusted required reserves (Table 2, column 3).
 5. The seasonally adjusted, break-adjusted monetary base consists of (1) seasonally adjusted, break-adjusted total reserves plus (2)
    the seasonally adjusted currency component of the money stock plus (3), for all quarterly reporters on the "Report of Transaction 
    Accounts, Other Deposits and Vault Cash" and for all those weekly reporters whose vault cash exceeds their required reserves, the 
    seasonally adjusted, break-adjusted difference between current vault cash and the amount applied to satisfy current reserve requirements. 
    (Also see footnote 3 on Table 2 and footnote 4 on Table 3.)
 p  preliminary
 
 
 
 
 H.3 (502)
 Table 2
 AGGREGATE RESERVES OF DEPOSITORY INSTITUTIONS AND THE MONETARY BASE
 Not adjusted for changes in reserve requirements1 
 Averages of daily figures, not seasonally adjusted
 Millions of dollars

 1. Reflects actual required reserves, with no adjustments to eliminate the effects of discontinuities, or "breaks", associated with 
    regulatory changes in reserve requirements.
 2. Reserve balances with Federal Reserve Banks plus vault cash used to satisfy reserve requirements.
 3. The monetary base, not break-adjusted and not seasonally adjusted, consists of (1) total reserves plus (2) required clearing balances
    and adjustments to compensate for float at Federal Reserve Banks plus (3) the currency component of the money stock plus (4), for all 
    quarterly reporters on the "Report of Transaction Accounts, Other Deposits and Vault Cash" and for all those weekly reporters whose 
    vault cash exceeds their required reserves, the difference between current vault cash and the amount applied to satisfy current reserve 
    requirements. Currency and vault cash figures are measured over computation periods ending on Mondays.
 4. Excludes required clearing balances and adjustments to compensate for float and includes other off-balance sheet "as-of" adjustments.
 5. Vault cash eligible to satisfy reserve requirements. It includes only vault cash held by those banks and thrifts that are not exempt
    from reserve requirements. Dates refer to the maintenance periods in which the vault cash can be used to satisfy reserve requirements.
 6. All vault cash held during the lagged computation period by "bound" institutions (i.e., those whose required reserves exceed their vault 
    cash) plus the amount of vault cash applied during the maintenance period by "nonbound" institutions (i.e., those whose vault cash 
    exceeds their required reserves) to satisfy current reserve requirements.
 7. Total vault cash eligible to satisfy reserve requirements, held by depository institutions not exempt from reserve requirements, minus the
    amount used to satisfy reserve requirements.
 8. Consists of carryover only at depository institutions maintaining reserves on the basis of two-week maintenance periods. Reflects excess (+) 
    or deficit (-) reserves eligible to be carried forward into the two-week reserve maintenance period ending on the date shown.
 p  preliminary
 
 
 
 
 H.3 (502)
 Table 3
 AGGREGATE RESERVES OF DEPOSITORY INSTITUTIONS AND THE MONETARY BASE
 Adjusted for changes in reserve requirements1 
 Averages of daily figures, not seasonally adjusted
 Millions of dollars

 
 1. Figures reflect adjustments for discontinuities, or "breaks", associated with 
    regulatory changes in reserve requirements.
 2. Break-adjusted total reserves equal break-adjusted required reserves (Table 3, 
    column 3) plus excess reserves NSA (Table 1, column 5).
 3. To adjust required reserves for discontinuities due to regulatory changes in 
    in reserve requirements, a multiplicative procedure is used to estimate what 
    required reserves would have been in past periods had current reserve 
    requirements been in effect. Break-adjusted required reserves are equal to 
    break-adjusted required reserves against transactions deposits.
 4. The break-adjusted monetary base equals (1) break-adjusted total reserves plus 
    (2) the (unadjusted) currency component of the money stock plus (3), for all 
    quarterly reporters on the "Report of Transaction Accounts, Other Deposits and 
    Vault Cash" and for all those weekly reporters whose vault cash exceeds their 
    required reserves, the break-adjusted difference between current vault cash and 
    the amount applied to satisfy current reserve requirements.
 p  preliminary          
 

 Note: Current and historical H.3 data are available each week on the Federal Reserve 
       Board's web site (http://www.federalreserve.gov/). Monthly data are available 
       back to January 1959, and weekly data are available back to January 1975 for most 
       series. For information about individual copies or subscriptions, contact 
       Publications Services at the Federal Reserve Board (phone 202-452-3245, 
       fax 202-728-5886). For paid electronic access to current and historical data, 
       call STAT-USA at 1-800-782-8872 or 202-482-1986. 

Statistical releases