Let’s start with a clarification: what is referred to as the FeD is the Federal Reserve System, a system composed of 12 federal reserve banks (the best known of which is undoubtedly the Federal Reserve Bank of New York[1]) and a central governing agency (the Board of Governors, whose members are appointed by the government and currently chaired by Ben Bernanke). The shareholding structure of each of these banks is therefore the relevant factor here. And, surprisingly at first glance, it is entirely private. The shareholders of each of the federal reserves are commercial banks. As soon as a bank obtains « member » status, it must also become a « shareholder, » holding a share of the capital of the regional Fed to which it is attached equal to 6% of its own capital.
However, these « shares » are different from usual shares: they do not give control, only the right to vote (regardless of the capital held) to elect three of the nine representatives on the governing board of the regional central bank in question, and the right to a dividend of 6% of their contribution each year under normal circumstances (with any surplus profits being paid to the Treasury).
Julien P and Guillaume A
[1]its chairman being a permanent member of the Federal Open Market Committee (composed of seven members of the Board + five rotating members of the Fed), undoubtedly linked to the important role played by New York.
