Fed sent $107.4 billion to Treasury in 2021

(Reuters) - The U.S. Federal Reserve returned more to the U.S. Treasury in 2021 compared to the year before, as its balance sheet grew to a record level and it continued to nurse the economy through the COVID-19 pandemic.

In preliminary financial information, released on Friday, the central bank reported it earned $107.8 billion primarily on its asset holdings in 2021, up $19.3 billion from the year before. Of that total, it sent $107.4 billion to the Treasury. Last year remittances were $86.9 billion, the statement showed.

The Fed since March 2020 has been ballooning its holdings of Treasury bonds and mortgage-backed securities to help lower long term rates as it battled the economic impact of the pandemic. The Fed's balance sheet has more than doubled from $4.1 trillion to more than $8.7 trillion over the past two years.

(Reporting by Lindsay Dunsmuir and Ann Saphir; Editing by Chizu Nomiyama)