Net income for the 12 regional Federal Reserve banks fell in 2011 as assets related to credit and liquidity programs fell by nearly $100 million.

The Federal Reserve banks in 2011 collectively earned $77.4 billion, derived primarily from $83.6 billion in interest income on Treasury securities and federal agency and government-sponsored enterprise mortgage-backed securities.

The Fed banks provided for payments of $75.4 billion of their 2011 income to the U.S. Treasury.

Total reserve bank assets as of the end of the year grew 20% to $2.9 trillion.

Holdings of U.S. Treasury securities increased 64% to $1.7 trillion and GSE debt securities holdings decreased 30% to $108 billion. Federal agency and GSE MBS holdings fell 16% to $848 billion. The Federal Reserve earned $81.7 billion in 2010.

Federal Reserve bank assets related to credit and liquidity programs decreased by $95.8 billion, the bank said. The closing of the American International Group recapitalization plan in January 2011 resulted in asset reductions of $47 billion, inclusive of the full repayment of the revolving line of credit with AIG in the amount of $20.6 billion and the sale of the Federal Reserve Bank of New York's preferred interests in two AIG-related LLCs in the amount of $26.4 billion.

jhilley@housingwire.com