Federal Reserve Bank:

1. Structure:
1. **Board of Governors**: The Board of Governors is the main governing body of the Federal Reserve System. It
consists of seven members appointed by the President and confirmed by the Senate. Members serve staggered 14-
year terms to ensure stability and independence. The chair and vice-chair are also appointed from among the seven
governors and serve four-year terms.

2. **Federal Open Market Committee (FOMC)**: The FOMC is responsible for setting monetary policy in the United
States. It consists of the seven members of the Board of Governors, the president of the Federal Reserve Bank of
New York, and four of the remaining 11 Reserve Bank presidents, who serve on a rotating basis.

3. **12 Regional Federal Reserve Banks**: The Federal Reserve System is divided into 12 regional districts, each
served by a Federal Reserve Bank. These banks are located in major cities across the country, including New York,
Boston, Philadelphia, Chicago, San Francisco, and others. Each Reserve Bank operates independently but is subject to
oversight and regulation by the Board of Governors.

4. **Member Banks**: National banks and state-chartered banks that choose to join the Federal Reserve System
become members. They hold stock in their regional Federal Reserve Bank and are required to adhere to certain
regulations and reserve requirements set by the Fed

5. **Monetary Policy**: One of the primary functions of the Federal Reserve is to conduct monetary policy to
achieve stable prices, maximum employment, and moderate long-term interest rates. The Fed uses various tools to
influence the money supply, including open market operations (buying and selling government securities), setting the
federal funds rate (the interest rate at which banks lend to each other overnight), and adjusting reserve requirements
for banks.

6. **Bank Supervision and Regulation**: The Fed supervises and regulates banks to ensure the safety and soundness
of the banking system. It establishes regulations and guidelines for bank operations, conducts examinations of banks
to assess their financial condition and compliance with regulations, and takes enforcement actions when necessary.

7. **Payment Systems Oversight**: The Federal Reserve plays a key role in overseeing and facilitating the operation
of the U.S. payment system. It operates several payment services, including the Fedwire Funds Service, which
facilitates large-value transfers between banks, and the Automated Clearing House (ACH) network, which handles
electronic payments such as direct deposits and bill payments.

8. **Consumer Protection**: The Fed is also involved in consumer protection and community development
initiatives. It enforces various consumer protection laws related to banking and financial services and works to
promote access to credit and financial services in underserved communities.

2. Features:
1. **Central Bank Structure**: The Federal Reserve System operates as the central bank of the United States. It is a
decentralized system consisting of a network of 12 regional Federal Reserve Banks located in major cities across the
country, overseen by the Board of Governors based in Washington, D.C.

2. **Independence**: While subject to oversight by Congress, the Federal Reserve operates with a high degree of
independence in conducting monetary policy. This independence helps insulate monetary policy decisions from
short-term political pressures and allows the Fed to focus on its dual mandate of price stability and maximum
employment.

3. **Dual Mandate**: The Federal Reserve's primary objectives, as mandated by Congress, are to promote maximum
employment and maintain stable prices. This is often referred to as the Fed's "dual mandate." In pursuit of these
goals, the Fed adjusts monetary policy tools such as interest rates and reserve requirements.
4. **Monetary Policy Tools**: The Fed has several tools at its disposal to conduct monetary policy. These include
open market operations (buying and selling government securities), adjusting the federal funds rate (the interest rate
at which banks lend to each other overnight), and setting reserve requirements for banks.

5. **Bank Supervision and Regulation**: The Federal Reserve oversees and regulates banks and other financial
institutions to ensure the safety and soundness of the banking system. It establishes regulations, conducts
examinations, and takes enforcement actions to promote financial stability and protect consumers.

6. **Lender of Last Resort**: In times of financial stress or crisis, the Federal Reserve acts as a lender of last resort to
provide liquidity to financial institutions and stabilize the financial system. This role is crucial for maintaining
confidence and preventing systemic disruptions.

7. **Payment System Oversight**: The Federal Reserve plays a key role in overseeing and operating the U.S. payment
system. It provides various payment services, such as the Fedwire Funds Service and the Automated Clearing House
(ACH network, which facilitate the transfer of funds between financial institutions.

8. **Research and Economic Analysis**: The Federal Reserve conducts research and economic analysis to inform its
policy decisions and enhance understanding of economic trends and developments. This research helps guide
monetary policy decisions and contributes to broader economic knowledge.

9. **Transparency and Accountability**: While independent, the Federal Reserve is accountable to the public and
subject to transparency requirements. It provides regular reports and communications to Congress and the public,
including minutes of Federal Open Market Committee meetings and an annual report to Congress.

10. **International Role**: The Federal Reserve also plays a significant role in international finance and monetary
policy coordination. It collaborates with other central banks and international organizations to address global
economic challenges and promote financial stability.

3. Functioning:
1. **Clearing and Settlement**: Federal Reserve Banks facilitate the clearing and settlement of payments between
financial institutions. They operate key payment systems, such as Fedwire Funds Service and the Automated Clearing
House (ACH) network, which enable the transfer of funds between banks and other financial institutions.

2. **Currency Distribution**: Federal Reserve Banks distribute and manage the nation's currency supply. They
ensure that enough currency is in circulation to meet the public's demand for cash while also safeguarding against
counterfeiting and maintaining the integrity of U.S. currency.

3. **Bank Supervision and Regulation**: While the Board of Governors sets regulatory policies, the Federal Reserve
Banks play a role in supervising and regulating banks within their respective districts. They conduct examinations of
banks to assess their financial condition, compliance with regulations, and overall safety and soundness.

4. **Discount Window Operations**: Federal Reserve Banks operate discount windows, which provide short-term
loans to eligible depository institutions (banks and credit unions) facing temporary liquidity shortages. These loans
help ensure the stability of the banking system and support the flow of credit to the economy.

5. **Monetary Policy Implementation**: Federal Reserve Banks play a crucial role in implementing monetary policy
decisions made by the Federal Open Market Committee (FOMC). They execute open market operations, buying and
selling government securities to influence the money supply and interest rates in line with the FOMC's policy
directives.

6. **Banking Services to the U.S. Treasury**: Federal Reserve Banks provide banking services to the U.S. Treasury,
including processing government payments, collecting tax revenues, and managing the government's accounts. They
also oversee the issuance and redemption of Treasury securities.

7. **Research and Data Collection**: Federal Reserve Banks conduct economic research and collect data to inform
monetary policy decisions and enhance understanding of economic trends and developments. They contribute to the
Federal Reserve's broader efforts to monitor and analyze the economy.
8. **Community Outreach and Education**: Federal Reserve Banks engage in community outreach and educational
initiatives to promote financial literacy, support community development efforts, and enhance understanding of the
Federal Reserve's role and functions.

4. Different from British central bank:

- **Federal Reserve System (Fed)**: The Fed is a decentralized system consisting of 12 regional Federal Reserve
Banks, overseen by the Board of Governors in Washington, D.C. The Board of Governors is appointed by the President
and confirmed by the Senate.

- **Bank of England**: The Bank of England is a single central bank located in London. It operates with a more
centralized structure compared to the Federal Reserve System.

2. **Independence**:

- **Federal Reserve System (Fed)**: The Fed operates with a high degree of independence in conducting monetary
policy, although it is subject to oversight by Congress. This independence helps insulate monetary policy decisions
from short-term political pressures.

- **Bank of England**: The Bank of England also operates independently in conducting monetary policy. It was
granted operational independence in 1997, with its Monetary Policy Committee responsible for setting monetary
policy to achieve the government's inflation target.

3. **Dual Mandate vs. Single Mandate**:

- **Federal Reserve System (Fed)**: The Fed has a dual mandate to promote maximum employment and maintain
stable prices. It aims to achieve both goals simultaneously.

- **Bank of England**: The Bank of England has a single mandate to maintain price stability, which is defined as an
inflation target set by the government. Its primary objective is to control inflation and keep it within a target range.

4. **Monetary Policy Tools**:

- **Federal Reserve System (Fed)**: The Fed uses various tools to conduct monetary policy, including open market
operations, setting the federal funds rate, and adjusting reserve requirements for banks.

- **Bank of England**: The Bank of England primarily uses interest rate adjustments as its main monetary policy
tool. It sets the Bank Rate, which influences other interest rates in the economy, affecting borrowing and spending.

5. **Banking Supervision and Regulation**

- **Federal Reserve System (Fed)**: The Fed plays a significant role in supervising and regulating banks within the
United States. It establishes regulations, conducts examinations, and takes enforcement actions to promote financial
stability and protect consumers.

- **Bank of England**: The Bank of England also has regulatory responsibilities, overseeing the stability and
resilience of the UK financial system. It regulates banks, insurance companies, and major investment firms, working
to ensure their safety and soundness.

6. **Lender of Last Resort**:

- **Federal Reserve System (Fed)**: The Fed acts as a lender of last resort during times of financial stress, providing
liquidity to financial institutions to stabilize the financial system.

- **Bank of England**: Similarly, the Bank of England serves as a lender of last resort, providing emergency liquidity
assistance to banks and financial institutions facing liquidity shortages.

7. **International Role**:
 - **Federal Reserve System (Fed)**: The Fed plays a significant role in international finance and monetary policy
coordination, collaborating with other central banks and international organizations to address global economic
challenges.

- **Bank of England**: The Bank of England also participates in international monetary policy discussions and
collaborates with other central banks, particularly within the European Union and through the Bank for International
Settlements.