What are Federal Reserve Banks?
Federal Reserve Banks were established by Congress as the operating arms of the nation’s central banking system. Many of the services provided to depository institutions and the federal government by this network of Reserve Banks are similar to services provided by commercial banks and thrift institutions to business customers and individuals. Reserve Banks • hold the cash reserves of depository institutions and make loans to them • move currency and coin into and out of circulation, and collect and process millions of checks each day • provide checking accounts for the Treasury, issue and redeem government securities, and act in other ways as fiscal agent for the U.S. government • supervise and examine commercial banks that are members of the Federal Reserve System for safety and soundness • participate in the activity that is the primary responsibility of the Federal Reserve System, the setting of monetary policy.
Federal Reserve Banks were established by Congress as the operating arms of the nation’s central banking system. Many of the services provided to depository institutions and the federal government by this network of Reserve Banks are similar to services provided by commercial banks and thrift institutions to business customers and individuals.
