Financial Update (First Quarter 2007)

Vol. 20, No. 1,
First Quarter 2007


Dennis Lockhart Named
Atlanta Fed President

Fed to Study Nation's
Payment Habits

Check 21 Continues
Brisk Growth

Atlanta Fed Joins
Poverty Research

Agencies Update Brochure
on Nontraditional Mortgages

Guidelines on Commercial
Real Estate Loans Issued

Bernanke Focuses on
Fed's Supervisory Role

New Atlanta Fed
Directors Named

$1 Presidential Coin
Program Begins

Fed Turns Money
Over to Treasury


Did You Know?

Data Bank

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Cash Volume Continues Growth

Cash is still very popular, even in the age of automated clearinghouse transactions and online banking. Despite a dramatic rise in the use of electronic payments, the volume of cash in circulation continues to grow.

Each day the BEP produces 35 million Federal Reserve notes with a face value of about $635 million. Of these new notes, 95 percent replace notes that are removed from circulation because of wear.

Date Amount of Currency and
Coin in Circulation

Sept. 30, 2006


Sept. 30, 2005


Sept. 30, 2000


Sept. 30, 1995


Currency in circulation
Printed by the U.S. Treasury's Bureau of Engraving and Printing (BEP) in Washington, D.C., and Fort Worth, Texas, currency is then distributed by the Federal Reserve Banks to financial institutions all over the United States. According to figures from the U.S. Treasury, about $753 billion worth of Federal Reserve notes circulate throughout the United States and around the world.

The Story of Money
BEP Web site off-site image

About two-thirds of all currency in circulation is held outside the United States. Some countries, such as Panama, Ecuador, and El Salvador, are dollarized, meaning they use the U.S. dollar as their official currency.

Life of a note
How long a Federal Reserve note lasts depends on how often it is used. So the most frequently used bills–those of lower denomination–have a shorter life span than the higher denominations.

Denomination Average Life Span













Currency removal and replacement and finding fakes
The cash processing function in the Federal Reserve Banks has two components: the currency function and the coin function. The currency function receives and verifies deposits, authenticates notes using high-speed sorting machines, receives new notes from the BEP, and puts them into circulation through financial institutions. The coin function generally involves the use of off-site carriers for the receipt, storage, and distribution of most coin; managing on-site and off-site inventories; and receiving new coins from the U.S. Mint.

The Federal Reserve Banks' currency processing machines count up to 100,000 notes per hour. Each month, the Federal Reserve Bank of Atlanta (including its branches) processes about 500 million notes. Atlanta processes between 6 million and 8 million currency notes each day.

The cash processing machines also detect counterfeits, which–along with any identifying information–are turned over to the U.S. Secret Service. Cash staff are certified twice a year to help identify counterfeit notes.

The Atlanta Fed destroys unfit notes—those that are ripped, torn, dirty, or fail to meet the minimum requirements for good currency. Each day, approximately $13 million–$19 million is shredded.