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61
was
A meeting of the Board of Governors of the Federal Reserve System
held in Washington on Monday, January 11, 1937, at 2:30 p.m.
PRESENT: Mr. Ransom, Vice ChairmanMr. BroderickMr. SzymczakMr. McKeeMr. Davis
Mr. Morrill, SecretaryMr. Bethea, Assistant SecretaryMr. Clayton, Assistant to the Chairman
It was stated that Chairman Eccles had discussed with Messrs.
Dreibelbis, Vest and Wingfield the handling of the affairs of the
legal division during the absence of Mr. Wyatt and that he advised
then of the decision which had been reached that Mr. Dreibelbis should
be placed in charge of the office of General Counsel during the present
arid anY future absences of Mr. Wyatt until otherwise determined by the
Board.
The Board then authorized the Secretary,in cooperation with Mr. Dreibelbis, to de-termine the procedure for advising the mem-bers of the staff of the Board's action.Later the Secretary reported that he andMr. Dreibelbis had agreed upon the follow-ing memorandum, which was delivered to Mr.Dreibelbis, and copies of which were sentto the members of the senior staff as wellas to the members of the Board:
"As you have been advised by the Chairman, the Boardhas decided, in view of the illness of Mr. Wyatt, and inorder to provide for the handling of the affairs of the°face of the General Counsel during his present and anyfuture absences, until otherwise determined by the Board,that you shall have charge of the office of the GeneralCounsel during such absences. As a result of this action,it is understood that Mr. Vest will be in charge duringanY period in which both Mr. Wyatt and yourself may be
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"absent, and that Mr. Wingfield will be in charge during
snY period in which dir. 4att, yourself and Mr. Vest maybe absent.
"It is also understood that you and Mr. Vest will in-form the other members of the staff of the office of the
General Counsel accordingly."I am furnishing copies of this memorandum to the
members of the senior staff as well as to the members ofthe Board."
Consideration was given to each of the matters hereinafter re-
ferred to and the action stated with respect thereto was taken by the
80ard:
The minutes of the meeting of the Board of Governors of the
Federal Reserve System held on January 9, 1937, were approved unani-
1°1181y.
Telegrams to Mr. Thomas, Chairman of the Federal Reserve Bank
Of4snees City, and Mr. McKinney, President of the Federal Reserve
}lank of Dallas, stating that the Board approves the establishment with-
clIt change by the Kansas City bank on January 9, 1937, and by the
Dallas bank today, of the rates of discount and purchase in their
existing schedules.
Approved unanimously.
Memorandum dated December 31, 1936, from Mr. Paulger, Chief of
the Division of Examinations, recommending that Federal Reserve Examiners
R. "s Calloway and E. D. Buck, and Assistant Federal Reserve Examiner F.
W.'B,sh, who have been dismissed effective December 31, 1936, be granted
aditicnal annual leave with pay for periods of 4 days, 2 hours and 5
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1/11/37
hours, respectively, respectively, during the year 1936.
Approved unanimously.
Letter to Mr. Young, President of the Federal Reserve Bank of
Boston, reading as follows:
"As you know, section 12 of the Federal Reserve Act,as amended, provides that the elective members of the Fed-
eral Open Market Committee and alternates to serve in the
absence of each such member shall be elected annually.
"Section 1 of Article 1 of the by-laws of the Committee
Provides, in part, that, prior to the first meeting of the
Committee following March 1st each year, each member of the
Committee representing the Federal Reserve banks and each
alternate elected to serve in the absence of each member
shall forward the record of his election or a certified copy
thereof to the secretary of the Committee.
"This letter is merely to remind you of such fact in
order that appropriate and timely action may be taken."
Approved unanimously, with the un-
derstanding that similar letters would
be sent to the Presidents of all other
Federal reserve banks.
Letter to the board of directors of "The Norwood-Hyde Park Bank
& Trust Company", Norwood, Ohio, stating that, subject to the conditions
Of membership numbered 1 to 5 contained in the Board's Regulation H and
the following special conditions, the Board approves the bank's applica-
tion for membership in the Federal Reserve System and for the appropriate
4111°1111t of stock of the Federal Reserve Bank of Cleveland:
"4. Such bank shall make adequate provision for depre-
ciation in its banking houses and furniture and
fixtures.
"5. Prior to admission to membership, such bank, if it
has not already done so, shall charge off or other-
wise eliminate estimated losses of 0,535, as shown
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"in the report of examination of such bank as of De-cember 7, 1956, mqde by an examiner for the FederalReserve Bank of Cleveland."
Approved unanimously, together with a
letter to Mr. Fleming, President of the Fed-
eral Reserve Bank of Cleveland, reading asfollows:
"The Board of Governors of the Federal Reserve System
aPProves the application of 'The Norwood-Hyde Park Bank &Trust Company', Norwood, Ohio, for membership in the Federal
Reserve System, subject to the conditions prescribed in the
inclosed letter which you are requested to forward to theboard of directors of the institution. Two copies of suchletter are also inclosed, one of which is for your files andthe other of which you are requested to forward to the Super-
intendent of Banks of the State of Ohio for his information.
"The Board also approves the application of The Norwood-Hyde Park Bank & Trust Company for permission, after admis-sion to membership, to operate the branch at 2710 Erie Avenue,HA? Park, Cincinnati, Ohio. Inclosed is a letter approvingsuch application which you are requested to forward to theboard of directors of the institution. A copy of the letteris also inclosed for your files.
"In order that the Board's records may be complete, itWill be appreciated if you will forward a copy of the certif-
icate issued by the State authorities to the bank to commence
business, if such a certificate was required at the time ofits organization in 1906, and, in the light of the Board'sletter of December 26, 1954 (X-9060), a copy of the form of
capital debentures which the bank has issued to the Recon-
struction Finance Corporation, together with a copy of any
approval which the State authorities may have given to the
issuance of such capital debentures."
In connection with the above matter
the following letter to the board of di-
rectors of "The Norwood-Hyde Park Bank &
Trust Company", Norwood, Ohio, was also
approved unanimouslys
"In connection with the application of 'The Norwood-Hyde Park Bank & Trust Company', Norwood, Ohio, for stockin the Federal Reserve Bank of Cleveland, the Board of Gov-
ernors of the Federal Reserve System approves the retention
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"and operation by The Norwood-Hyde Park Bank & Trust Com-pany, after admission to membership, of the branch at 2710Erie Avenue, Hyde Park, Cincinnati, the establishment ofWhich was approved effective as of April 20, 1929, by the
Superintendent of Banks for the State of Ohio."
Letter to the board of directors of the "National Savings and
Trust Company", Washington, D. C., stating that, subject to the conditions
of membership numbered 1 to 6 contained in the Board's Regulation H and
the following special condition, the Board approves the bank's application
for membership in the Federal Reserve System and for the appropriate amount
of stock of the Federal Reserve Bank of Richmond:
"7. Such bank shall make adequate provision for deprecia-
tion in its banking house and furniture and fixtures."
Approved unanimously, together with a
letter to Mr. Leach, President of the Fed-
eral Reserve Bank of Richmond, reading asfollows:
"The Board of Governors of the Federal Reserve System
approves the application of the 'National Savings and Trust
Company', Washington, D. C., for membership in the Federal
Reserve System, subject to the conditions prescribed in the
inclosed letter which you are requested to forward to the
board of directors of the institution. A copy is also in-
closed for your files."The usual condition regarding the elimination of loss-
es has not been prescribed inasmuch as the files of the Comp-
troller of the Currency indicate that the losses as esti-
mated in the report of examination as of August 12, 1936,have been eliminated.
"It has been noted that the bank has applied to the
Comptroller of the Currency for permission to retire all ofthe capital debentures and that your Committee has recom-
mended that such permission be granted. The Comptroller's
Office has advised informally that it is not inclined to
approve such a retirement at this time, and the Board feels
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"that, if and when approval for a reduction in the amountof debentures is requested under the provisions of condi-tion of membership numbered 2, the advisability of approv-ing such retirement should be discussed by your bank withthe office of the Comptroller of the Currency. In connec-tion with the desire of the bank to retire its debenturesat this time, the Board feels that any retirement of thedebentures, except perhaps in nominal amount, should be de-ferred at least until after another examination of the bankin order to determine what progress the bank has made.
"In order that the Board's records may be complete, itwill be appreciated if you will forward to the Board, in thelight of its letter of December 26, 1934 (X-9060), a copy ofthe form of capital debentures which the bank has sold tothe Reconstruction Finance Corporation."
Letter to the board of directors of the "Trenton State Bank",
Trenton, Michigan, stating that, subject to the conditions of membership
numbered 1 to 3 contained in the Board's Regulation H and the following
ePeeial condition, the Board approves the bank's application for member-
Ship in the Federal Reserve System and for the appropriate amount of
stock ofthe Federal Reserve Bank of Chicago:
"4. Such bank shall make adequate provision for deprecia-tion in its banking house and furniture and fixtures."
Approved unanimously, together with aletter to Mr. Schaller, President of theFederal Reserve Bank of Chicago, readingas follows:
"The Board of Governors of the Federal Reserve Systemapproves the application of the 'Trenton State Bank', Trenton,Michigan, for membership in the Federal Reserve System, sub-ject to the conditions prescribed in the inclosed letterWhich you are requested to forward to the board of directorsof the institution. Two copies of such letter are also in-closed, one of which is for your files and the other of whichyou are requested to forward to the Commissioner of the Bank-ing Department for the State of Michigan for his information.
"It has been noted from the presentation memorandum ac-"mPanying the application that you will call the bank's
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"attention to the facts that as a member bank balances withState nonmember banks should be kept within the limitationsfixed by section 19 of the Federal Reserve Act and thatProper adjustment should be made in the carrying value ofthe bonds which are carried in excess of the call price."
Telegram to Mr. McKinney, President of the Federal Reserve Bank of
Dallas, stating that, subject to the conditions of membership numbered 1
to 3 contained in the Board's Regulation H and the following special con-
the Board approves the application of the "Bay City Bank & Trust
C°mPanY", Day City, Texas, for membership in the Federal Reserve System
'la for the appropriate amount of stock of the Federal Reserve Bank of
nauas:
1,4. Such bank shall make adequate provision for depreciationin its banking house."
The telegram also stated that the following advice in addition to the
usual comments would be contained in the Poard's letter to the bank:
is noted that the bank is authorized under its charterto exercise certain powers which it is not exercising atthis time. Attention is invited to the fact that, if thebank should hereafter desire to exercise such powers or anyOther power not actually exercised at the time of admission,it would be necessary under condition numbered 1 to obtainthe Board's permission before exercising them. In this con-?action the Board understands that there has been no changein the scope of the corporate powers exercised by the banksince the date of its application for membership."
The telegram stated further that it would be noted that the Board had not
Prescribed the special condition of membership which had been recommended
bY the executive committee of the Dallas bank covering the future exercise
by t he bank of certain unusual powers; that it was understood that the
banip •lE not now exercising any unusual powers and the Board had recently
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taken the position that in cases of this kind, such a condition was unneces-
sarY inasmuch as the exercise of such powers would be covered by condition
or membership numbered 1; and that in lieu, therefore, of prescribing a
sPecial condition, the letter to the bank called particular attention to
the necessity of obtaining the Board's permission, under condition numbered
is before the bank may exercise any such unusual powers after it was ad-
mitted to membership. The telegram also stated that the papers submitted
with the bank's application did not include a copy of the certificate is-
811ed by the State authorities authorizing it to commence business, and
requested that, if such a certificate was required at the time of the
bank'S organization in 1907, a copy thereof be forwarded to the Board in
("er that its records may be complete.
Approved unanimously.
Telegram to Mr. Wood, Vice President of the Federal Reserve Bank
or St. Louis, reading as follows:
"Relet January 5 reference question whether SouthwestRealty Company is affiliate of Southwest Bank of St. Louis.On basis of facts stated and assuming that there has beenno material change in such facts since the time of bank's1936 election of directors, Board is of opinion that South-west Realty Company is not an affiliate of bank under sec-tion 2(b)(2) of Banking Act of 1933. If there has been anymaterial change you should advise as to the facts. Defini-tion of term 'affiliated' contained in Regulation P is forPurpose of such regulation only and apparently is not here
Involved."
Approved unanimously.
Memorandum dated January 5, 1957, from Mr. Noell, Assistant
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Secretary, recommending, for the reasons stated in the memorandum, that
the Practice of having the Call Report printed commercially be followed
hereafter unless future experience indicates the desirability of a change;
that the practice of executing contracts covering all issues of the Call
Report printed during a twelve month period be followed in the future;
and that, for the reasons stated in a memorandum dated December 29, 1936,
from Mr. Horbett, Assistant Chief of the Division of Bank Operations, a
contract for printing and binding the issues of the Member Bank Call Re-
Port to be published during 1957 be executed with Judd and Detweiler, Inc.,
On the basis of its bid dated December 14, 1936, with the understanding
that the Board will furnish the paper stock as it has done in the past.
Approved unanimously.
Thereupon the meeting adjourned.
ealaii )T1 • Lk Secretary.
APProvedt
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