HomeChannelsBusinessFed will pay $92 billion in profits to U.S. Treasury for 2016

Fed will pay $92 billion in profits to U.S. Treasury for 2016

WASHINGTON The Federal Reserve on Tuesday said it would turn over $92.0 billion in profits to the U.S. Treasury in 2016, down from the $97.7 billion the central bank’s 12 regional banks paid back to the U.S. government in the previous year.

The Fed earns interest on government bonds that it holds as well as from securities tied to mortgage-finance giants Fannie Mae and Freddie Mac.

Through the purchase of such investments, the central bank can help push down borrowing costs in other sectors of the economy.

It uses a share of its earnings to cover operating expenses, the cost of printing currency and to help fund the Consumer Financial Protection Bureau, which was conceived as a result of the 2010 Dodd Frank financial reform law.

Fed board expenses were $709 million, up slightly from the $705 million in 2015. Contributions to the CFPB were $596 million last year compared to $490 million a year earlier.

(Reporting by Patrick Rucker and Howard Schneider; Editing by Andrea Ricci and Paul Simao)


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