2008 Annual Report

LETTER FROM THE PRESIDENT

Unprecedented economic turmoil challenged the Federal Reserve System and the Federal Reserve Bank of Chicago in 2008. Housing markets deteriorated. Employment and consumer confidence plummeted, and credit markets experienced large-scale disruptions. The Fed responded aggressively to stem the tide. We looked at problems in new ways and responded quickly to a rapidly changing financial services industry.

The Bank's new vision statement helped guide our efforts. It emphasizes the importance of talented staff members collaborating with one another as well as with customers and stakeholders. It reinforces our commitment to work in the public interest to foster a strong economy and stable financial system. Approaching our jobs with this vision in mind helped us deal with not just the financial crisis but also with restructuring our check-processing operations, offering high-quality currency services, and helping banks access our electronic payment products more effectively.

As we navigated through these challenges, our boards of directors in Chicago and at the Detroit Branch made important contributions. Their counsel on our operations and insight into regional business conditions proved to be especially valuable as the year progressed. They asked tough questions, provided thoughtful feedback, and shared useful information on economic conditions.

This year's annual report looks at other ways we gather and share information on economic and financial conditions: our conference program. The report outlines some of the findings of important conferences we sponsored in 2008. As always, we leveraged our unique ability to convene top experts in diverse fields. As the financial crisis unfolded, these experts discussed timely topics such as credit market turmoil, the state of the automotive industry, risk management, the economic forecast, preventing home foreclosures and promoting financial education.

These conferences foster an informed debate on important public policy issues facing the economy and banking system. They provide new perspectives and contribute to the development and dissemination of high-quality research. The summary that follows offers a glimpse into the concerns and policy solutions that surfaced as the year progressed. I hope you find it informative.

Charles L. Evans
President and Chief Executive Officer