The Federal Reserve System paid $80.2 billion out of its annual net income to the U.S. Treasury in 2017, according to figures released today. The payments dipped slightly from previous years, falling from $92 billion in 2016 and $97.7 billion in 2015, but still more than double the sums contributed in the mid to late 2000s.
The Federal Reserve Banks’ net income in 2017 was estimated at $80.7 billion; Treasury payments are calculated after the costs of operations, dividends and other expenses. Fed bank income comes mostly from interest on securities purchased through the system’s open market operations. Net income fell by $11.7 billion from 2016 due primarily to an increase in the interest that the Fed banks pay on reserve balances held by banks and credit unions, which are used by the Fed banks to purchase income-bearing securities.
The regional Fed banks had net operating expenses of $4.1 billion in 2017, and the Fed system also paid $724 million to produce and retire currency, $740 million to fund the Federal Reserve Board of Governors and $573 million for the operations of the Consumer Financial Protection Bureau. Dividend payments to Federal Reserve member banks totaled $784 million.