Shares in the regional Fed Reserve Banks are highly restricted. Each commercial member bank has the same number of shares as every other bank. These shares cannot be sold and the shares pay an annual 6% dividend.
The Federal Reserve System does not hold corporate stocks, but it does hold government securities. In 2001 government securities1 accounted for a significant share of Federal Reserve System’s $654 billion in assets. The Federal Reserve’s securities portfolio is composed of securities issued by the United States government or government agencies. Securities held by Federal Reserve Banks are obtained and traded through open market operations.