HR 7837 1913 1218sen Bankcurrbill

7/30/2019 HR 7837 1913 1218sen Bankcurrbill

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63d Co n g r e s s j2d Session (

SENATEj D o c u m e n t \ No. 335

BANKING AND CURRENCY BILL

COMPARATIVE PRINT

SHOWING

H. R. 7837AN ACT TO PROVIDE FOR THE ESTABLISHMENT OF FEDERAL RESERVE BANKS, TO

FU RNISH AN ELASTIC CURREN CY, TO AFFO RD MEANS OF REDISCOUNTING COM-

MERCIAL P APER, TO ESTABLISH A MORE E FFE CTIVE SUPERVISION OF

BANKING IN THE UNITED STATES, AND FOR OTHER PURPOSES

AS PASSED BY THE HOUSE, AS PASSED BY THE SENATE,

AND AS AGREED TO IN CONFERENCE

W A S H I N G T O N

G O V E R N M E N T P R I N T I N G O F F I C E

1913


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SUBMITTED BY MR. OWEN,

I n t h e S e n a t e o f t h e U n it e d S t a t e s , Decem ber 18, 1918.

Ordered, That there be printed as a Senate document, in document type and in three parallel columns, a

compa r ative pr int of the ban king an d curr ency bill (H. R . 78.37), An a ct to pr ovide for t he establishmen t of

Federal reserve banks, to furnish an elastic currency, to afford means of rediscounting commercial paper, to

establish a more effective supervision of banking in the United States, and for other purposes, showing the

bill as passed by the House, the bill aa passed by the Senate, and the bill as agreed to in conference, and that

5,000 additional copies be printed for the use of the Senate document room.

At tes t :

J am es M . B akes , Secretary.(2)


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63d CONGKESS,2d Se s s i o n . H. R. 7837.

IN THE SENATE OF THE UNITED STATES.

[The par t print ed in small capitals shows the new matt er proposed; the part inclosed in hea vy brackets ]shows matter proposed to be omitted.]

AN ACT TO PROVIDE FOR TH E E STABLISHMENT OF F EDE RAL RESE RVE BANKS, TO FURN ISHAN ELASTIC CURRENCY, TO AFFORD MEANS OF REDISCOUNTING COMMERCIAL PAPER,TO ESTABLISH A MORE EFFECTIVE SUPERVISION OF BANKING IN THE UNITED STATESAND FOR OTHER

H O U S E B I L L .

B e it enacted by the S enat e an dH ouse of Represen ta tives o f the UnitedS tates o f Am erica in Congress assem -bled, That the short title of this Actshall be the Federal Reserve Act.

S E C T I O N 1.

P A S S E D B Y S E N A T E .

B e it enacted by the S ena te andH ouse of R epresenta tives o f the

United S tates of Am erica in Con-gress assem bled, That the short titleof this Act shall be the Federal Re-serve Act.

Wherever the word bank is usedin this Act, the word shall be held to

*includ e State ban k, banking associa-tion , and trust compa ny , except wh erenational banks or Federal reservebanks are specifically referred to.

The terms national bank and

**nationa I bank ing association

used in this A ct shall be heldto be synonym ous and in terchan ge-able. The term member bankshall be held to m ean any na tionalbank, State banlc, or bank or trustcom pan y wh ich h as becom e a memberof one of the reserve banks created bym is A ct. The term board shall beheld to mean Federal R eserve Board;the term district shall be held tom ean Federal reserve d istrict; theterm reserve bank shall be held tomean Federal reserve bank.

C O N F E R E N C E A G R E E M E N T .

B e it enacted by the S enate an dHouse of R epresen ta tives of theUnited S tates of Am erica in Con-

gress assem bled, Th at the short titleoi this A ct shall be the u Federal R e-serve A ct.

Wh erever the word bank is usedin this A ct, the word shall be held toinclude State bank, banking associa-tion, an d trust com pan y, except wherenational banks or Federal reservebanks are specifically referred to.

The terms na tiona l ban k and

national banking association 7used in this A ct shall be held to besynonym ous an d in terchan geable.Th e term u m em ber ban k shall beheld to mean any national bank,S tate bank, or banlc or trust com pan ywh ich has become a m ember of one ofthe reserve banks created by this Act.Th e term board shall be held tomean Federal Reserve Board; theterm d istrict shall be held to m eanFederal reserve district; the term reserve bank shall be held to m eanFederal reserve bank.

S E C T I O N 2 .

FE DERAL RESE RVE DISTRICTS. FED ERAL RESERVE DISTRICTS. FEDE RAL RESE RVE DISTRICTS.

S e c . 2. That within ninety daysafter the passage of this Act, or assoon thereafter as practicable, theSecretary of the Treasury, the Sec-reta ry of Agricultur e, a nd t he Comp-troller of the Currency,

soon feheyeafoe*8 as pr acticable,the Secretary of the Treasury, the

Gem fteeU e?etfee***HFeneyj and

(3)

Se c . 2. A s soon as pract icable, th eS ecretary of the T reasury, la n d notless than two other members of theFederal Reserve Board, hereinafter


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S E C T I O N 2C o n t i n u e d .

H O U S E B I L L .

acting as

The Reserve Ban k OrganizationCommittee, shall designate fromamong the reserve and central re-serve cities now authorized by law anumber of such cities to be knownas Federal reserve cities, and shalldivide the continen ta l United Statesinto districts, each district to con-tain one of such Federal reservecities: Provided, That the districtsshall be apportioned with due re-

gard to the convenience and2 cust omar y cour se of business

of the community and shallnot necessarily coincide with thearea of such State or States as maybe wholly or in pa rt in cluded in a ny


not less than two other members of theFederal Reserve Board, hereinafter

Provided fo r , to be assigned by the'resident, acting as The ReserveBank Organization Committee,shall designa te feomam ong th eFe

ftttfeh ofkedbyIftwa n umber o f snehnot less than eight nor more thantwelve cities to be known as Federalreserve cities, and shall divide thecontinent al United States, includingA la sk a , into districts, each districtto cont ain one, and only one, of suchFeder al reser ve cities.

T he determ i-na tion of said organization com m itteeshall not be subject to review exceptby the Federal Reserve Board when organized: Provided, That the dis-tricts shall be apportioned withdu eand

given district. The districts thu screated may be readjusted and newdistricts may from time to time becreated by the Federal ReserveBoard hereinafter established, act-

ing upon a joint application madeby n ot less than ten member banksdesiring to be organized into a new

district. The districts thu s cons ti-tuted shall be known as Federalreserve districts and shall be desig-nated by number according to thepleasure of the organization com-mittee, and no Federal reserve dis-trict shall be abolished, nor thelocation of a Federal reserve bankchanged, except upon the applica-tion of threefourths of the memberbanks of such district.

The organization committee shall,in accordance with regulations tobe established by itself, proceed toorganize in each of th e reserve citiesdesignated as hereinbefore speci-fied a Feder al reserve ban k. Ea chsuch Federal reserve bank shall in-clude in its title the name of thecity in which it is situ at ed, as Fed -eral Reserve Bank of Chicago, andso fort h. The total num ber of re

regard to the conveniencecustomary course of business

ef the c om m im k y and shall not

o fsuch be ' cotermin ous with an yState or States fts m a y b e w h e l l y e Fm pft ft in cmd od in ftny""gi\ cn diSt ei efc. The dist ricts t hu s creat edm a y be readjusted and new districtsm a y from time to time be createdby the Federal Reserve Board

Provided fo r , to be assigned by the'resident,J t h e s e c r e t a r y o f a g -r i c u l t u r e AND THE COMPTROLLER

o f t h e c u r r e n c y , acting as Th e

R eserve B an k Organizat ion Com m it-tee, shall designate n ot less than eight


nor more than tw elve cities to be kn own as Federal reserve cities, and shalldivide the continental United States,fynclu d in g'Je x c l u d i n g A la sk a, in todistricts, each district to contain on e, andJ only on ef. 1 o f such Fed-eral reserve cit ies.

Thedeterm ination of said organization com m ittee shall not be subject to re-view except by the Federal R eserve

Board when organized: Provided,That the districts shall be appor-tioned with due regard to the conven-ience and custom ary course of bu sinessand shall not necessarily be coterm i-nous with an y S tate or States. Thedistricts thus created m ay be read-justed and new dist ricts m ay fr om tim e to time be created by the FederalR eserve B oard ,

notto exceed tw elve in al l. Th e Such districts febasee n s fcifoated shall beknown as Federal reserve districtsand shftU m ay be designated bynumber

not to exceed twelve in all . Such dis-tricts shall be known as Federal re-serve districts and m ay be designatedby num ber.

dis^iefc. A m ajori ty of the organi-

za tion comm ittee shall cons titu te aquorum loith authority to act.

ril vvvTUCCIluv WTtJ 11' " T u I U 118 l ) \J

A m ajori ty o f th e or-

ganization committee shall constitutea quorum with authority to act.

as Fe d e Fa l --Riosor ve - Ba n k - e f h i


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S E C T I O N 2C on t i n u e d .

serve cities designated by the or

f;anization committee shall be notess than twelve, and the organiza-

tion committee shall be authorized

to employ counsel and expert aid,to take testimony, to send for per-sons and papers, to administeroaths, and to make such investiga-tions as may be deemed necessary

by t he said committee for the3 pur pose of determ ining th e

reserve cities to be desig-nated and organizing the reservedistricts hereinbefore provided.

Ever y national bank locat ed with-in a given district shall be requiredto subscribe to the capital stock ofthe Federal reserve bank of thatdistrict a sum equal to twenty per

centum of the capital stock of suchnational bank fully paid in and un-impaired, onefourtn of such sub-scription to be paid in cash and onefourth within sixty days after saidsubs cription is made. The rema in-der of the subscription or any partthereof shall become a liability ofthe member bank, subject to calland pa yment th ereof whenever nec-essary to meet the obligations of theFederal reserve bank under suchterms and in accordance with suchregulations as the board of directorsof said Federal reserve bank mayprescribe: Provided, That no

H O U S E B I L L . P A S S E D B Y S E N A T E .

be -nefe-lesg-thftn t welv e-an d - th e e f-


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f l f t T T 1__ __ c m i / j ____ f l n k n A i t T / \ r ^ t ault jo' T t T V U T Cfcltn' Cytl WtTt7il xfif

Said organization committee shallbe au thorized to em ploy counsel andexpert aid, to take testim ony, to send

for personl


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HOUSE BTLIfc

S D632vol 25----- 9


within sixty days after the passage oj this A ct, its acceptance o fthe terms arm

prov ision s h er eo fW h en a Federal reserve bank shall have been organ ized,

every national banking association within that district shall be requiredand every eligible bank m ay be per-m itted to subscribe to the cap ita l stockth ereof in a sum equal to six per cen-tum of the paidup capital stock andsurplu s of such bank , onesixth ofthe subscription to be payable on call o f the organ ization com m itteeor o f the Federal R eserve Board,onesixth within three months andonesixth within six months there-after, and the rema ind er of the sub-scription, or any part thereof\ shallbe subject to call w hen deemed

necessary by the Federal R e-serve B oard , said paym ents to be in gold or gold certificates.

S E C T I O N 2C on t i n u e c

The shareholders of every Federalreserve bank sh all be held indiv idu allyresponsible, equally and ratably, andnot one fo r another, fo r all contracts,debts, and engagem ents of such bankto the extent of the amount of theirsubscriptions to such stock at the parvalue th ereof in add ition to theam ount su bscribed, whether such su b-scriptions have been paid up in wh ole or in part, un der the provisions of this Act.

A n y nat ional ban k fa il in g to sig-n ify its acceptance of the terms of this

A ct within the sixty days aforesaid

shall cease to act as a reserve agent,upon thirty days notice, to be given within the discretion of the said or-ganiza tion comm ittee or of the Fed-eral Reserve Board.

Should any national banking asso-ciation in the United States now organized fa il , within one year afterthe passage of th is A ct, to becom e amember bank under the provisionshereinbefore stated, or fa il to com plywith a ny of the provisions of this A ctapplicable thereto, all of the rights,

privi leges, and fran ch ises o f suchassociation granted to it under

the nationalbank Act, or underthe provisions o f this A ct, shallbe thereby forfeited. A n y non

within sixty days after the passage ofthis Act, its acceptance of the term s and

prov ision s h ereof. [ When a Federalreserve bank shall have been organ-

ized,J W h e n t h e o r g a n i z a t i o nCOMMITTEE SHALL HAVE DESIG-

NATED THE CITIES IN WHICH F E D

ERAL RESERVE BANKS ARE TO BE

ORGANIZED, AND FIXED THE GEO-

GRAPHI CAL LIMITS OF THE F E D

ERAL r e s e r v e d i s t r i c t s , everynational banking association within that district shall be required, J[andevery eligible bank m ay be per-m itted^ WITHIN THIRTY DAYS AFTERNOTICE FROM THE ORGANIZATION

c o m m i t t e e , to subscribe, to thecapital stock J^thereofJi o f s u c h F e d e r a l r e s e r v e b a n k in asum equal to six per centum of the paidup capital stock andsurplu s of such bank, onesixth o fthe subscription to be payable on call of the organization comm itteeor of the Federal Reserve Board,onesixth within three months andonesixth within six months there-after, and the rema ind er of the sub-scription, or any part thereof, shallbe subject to call when deemednecessary by the Federal R e-serve Board, said paym ents to be in gold or gold certificates.

The shareholders of every Federalreserve bank shall be held irid ividu allyresponsible, equally and ratably, andnot one for another, for all contracts,debts, and engagem ents o f such ban kto the extent of the am ount o f theirsubscriptions to such stock at the parvalu e thereof in addition to theam ount subscribed, whether such sub-scriptions have been paid up in whole or in part, under the provisions of this A ct

A n y nat ional ban k fa il in g to sig -n ify its acceptan ce of the term s o f thisA ct w ith in the sixty days aforesaid ,

shall cease to act as a reserve agent,upbn thirty days notice, to be given within the discretion of the said or-ganization comm ittee or o f the Fed-eral R eserve B oard.

Should any national banking asso-ciation in the United States now or-ganized fail within one year afterthe passage of this A ct to becom e am em ber bank fu n d er the provisionshereinbefore stated, J or fa il to com ply with any of the provisions of this Actapplicable thereto, all of the rights,

pn vileges, an d fran chises o f su ch association granted to it under the

nationalbank Act, or under the pro-visions o f this A ct, shall be thereby

forf eit ed . A n y noncom pliance w ith



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S E C T I O N 2C o n t i n u e d .

[OU SE B I L L . P AS S E D B Y S E N AT E .#

com pliance with or violation ojthis Act shall, however, tiedetermined. and adjudged byan y court of the United S tatesof competent jurisdiction in a suitbrought fo r that purpose in the dis-trict or territory in which such bankis located, under direction of theFederal Reserve Board, by the Comp-troller of the Cu rrency in his own nam e before the association sh all bedeclared dissolved. hi cases of such noncom plian ce or violation, otherthan the fa ilu re to becom e a mem berbank un der the provisions of this

A ct f every d irector who pa rticipatedin or assented to the sam e shall beheld liable in Ids persona l or ind i-vidual capacity for dll damages which said bank, its shareholders, or anyother person shall have sustained in consequen ce o f such v iolat ion .

Such dissolution shall not takeaway or im pair an y rem edy againstsuch corporation, its stockholders orofficers, for any liability or penalty which shall have been previously incurred.

Should the subscriptions by banksto the stock o f said Federal reservebanks or any one or more of them be,in the judgm ent of the organizationcom m ittee, insufficient to provide the

am ount of capital required th erefor,then and in that event the said organ i-za tion comm ittee m ay, under condi-tions and regulations to be prescribedby it, offer to public subscription at

par such an am oun t of stock in saidFederal reserve banks, or any oneor m ore of them , as said comm itteeshall determin e, subject to the sameconditions as to paym ent in andstock liability as provided for memberbanks.

No in divid ual, copartn ersh ip, orcorporat ion other than a m em berbank of its d istrict shall be perm itted

to subscribe for or to hold, at an y tim em ore than $10 ,000 pa r value of stockin an y Federal reserve bank. S uchstock shall be known as public stockand m ay be tran sferred on the booksof the Federal reserve bank by thechairm an of the board of directors ofsuch bank,

Should the total subscriptions bybanks and the public to the stock ofsaid Federal reserve banks, or anyone or m ore of them, be, in the jud g-m ent of the organization comm ittee,insufficient to provide the amount ofcapital required therefor, then and in

that event the said organization com-m ittee shall allot to the United S tatessuch an amount of said stock as said

or violation of this Act shall, how-ever, be determ ined and a d-

judged by any court o f theUnited S tates of com petent

ju risd iction in a su it brought fo r thatpu rpose in the Distr ict or T erritory in which such bank is located, underdirection of the Federal Reserve

Board ,' by the Com ptroller o f the Cur-rency in his ownnam e before the association shall bedeclared dissolved. In cases o f such noncontpliance or violation, otherthan the failu re to becom e a m emberbank und er the provisions of thisAct, every d irector who pa rt icipatedin or assented to the same sha ll beheld liable in his personal or indi-

vidual capacity for all damages which said bank, its shareholders, or anyother person shall have sustained in consequence of su ch viola tion .

Such dissolution shall not takeaway or im pair an y rem edy againstsuch corporation, its stockholders orofficers, fo r an y liability or penalt ywhich shall have been previously incurred.

Should the subscriptions by banksto the stock of said Federal reservebanks or any one or m ore of them be,in the judgm ent of the organizationcom m ittee, in su fficient to provide the

am ount o f capita l required th erefor,then and m that event the said organi-za tion com m ittee m ay , under cond i-tions and regulations to be prescribedby it, offer to public subscription at

par such an am oun t o f stock in saidFederal reserve ban ks, or an y oneor more of them , as said com m itteeshall determ ine, su bject to the sam econd itions as to paym ent i n J andstocle liability as provided for memberbanks. _

N o individ ual, copartnersh ip, orcorporation other than a memberba/ nk of its d istrict shall be perm itted

to subscribe fo r or to hold at a ny tim emore than $10,000J $25,000 parvalue of stock in an y Federal reservebank. S uch stock shall be kn own as

pu blic stock an d m ay be transferredon the books o f the Federal reservebank by the chairm an of the boardof directors of such bank.

Should the total subscriptions bybanks and the public to the stock ofsaid Federal reserve banks, or any one or m ore o f them, be, in the jud g-ment. of the organization com m ittee,insu fficient to provid e the am ount o fcapital required therefor, then and in

that event the said organization com-m ittee shall allot to the United S tatessuch an am oun t of said stock as said



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H O U S E B I L L . P A S S E D B Y S E N A T E . C O N F E R E N C E A G R E E M E N T .

Fed-eral reserve bank shall commencebusiness with a paidup and unim-paired capital less in amount than$5,000,000.

The organization com-mittee shall have power to appointsuch assistant s a nd incur such ex-penses in carrying out the provi-sions of this Act as it shall deem nec-essary, and such expenses shall bepayable by the Treasurer of theUnited States upon voucher ap-proved by the Secretary of theTreasury, and the sum of $100,000,or so much th ereof as ma y be neces-sary, is hereby appropriated, out ofany moneys in the Treasury nototherwise appropriated, for t he pa y-ment of such expenses.

comm ittee shi ll determ ine. SaidUnited S tates stoclc shall be pa id for

at par out of any money in theT reasury not otherwise appropriated,

and shall be held by the Secretary o fthe Treasury and disposed of for thebenefit of the United S tates in suchm an ner, at such tim es, and at suchpri ce, not less than par, as the S ecre-tary o f the Treasury shall determ ine.

S tock not held by member banksshall not be entitled to voting powerin the hands o f its h olders, but thevoting power thereon shall be vestedin and be exercised solely by the classC directors of the Federal reservebank in which said stock m ay be held,and who shall be designated as votingtrustees Th e voting power on saidpublic stock shall be lim ited to one votefor each $15,000 par va lue th ereof',fractional am oun ts not to be consid -ered. Th e voting tru stees shall exer-cise the same powers as m ember banksin voting for class A and class B directors.

The Federal Reserve Board is hereby empowered to ad opt and p ro-mulgate rules and regulations gov-erning the transfers of said stock andthe exercise o f the voting power thereon .

N oFedera l reserve bank shall com-mence business with a paidupandunimpaired subscribed capita l less inam ount t ha n $5 000 000 $8,000,000.The organization of reserve districtsand Federal reserve cities shall notbe construed as changing the presentstatus of reserve cities and centralreserve cities, except in so fa r as th isA ct changes the am oun t o f reservesthat m ay be carried with approvedreserve agents located therein.

Th eorganization committee shall havepower to appoint such assistantsand incur such expenses in carryingout the provisions of this Act as

it shall deem necessary, and suchexpenses shall be payable by theTreasurer of the United States u ponvoucher approved by the Secretaryof the Treasury, and the sum of$100,000, or so much thereof as maybe necessary, is her eby app ropriat ed,out of any moneys in the Treasurynot otherwise appropriated, for thepayment of such expenses.

com m ittee shall determin e. S aidUnited S tates stock shall be pa id fo r

at par out of any m oney in theTreasury not otherwise appropriated,

and shall be held bu the S ecretary o fthe Treasury an d d isposed o f fo r thebenefit of the United S tates in suchm ann er, at such tim es, and at such price, not less than pa r, as the S ecre-tary of the Treasury shall determ ine.

Stock not held by member banksshall not be entitled to voting power[ m the hands of its holders, but thevoting power thereon shall be vestedin and be exercised solely by the classC directors of the Federal reservebank in wh ich said stock m ay be held,and who shall be designated as votingtru stees. The voting power on saidpu bl ic stock shall be lim ited to one votefor each $15,000 par va lue th ereof,fractional am oun ts not to be cons id -ered. The voting tru stees sha ll exer-cise the sam e powers as m em ber banksin voting fo r class A and class B directors] .

The Federal Reserve Board is hereby empowered to adopt and pro-mulgate rules and regulations govern ing the transfers of said stock la n d theexercise of the voting power thereon\ .

N o Federal reserv e ban k shall com-m ence business with a subscribedcapital less [ m amountJ than l$3,000,0002 $4,000,000. The or-gan ization of reserve d istricts andFederal reserve cit ies shall not beconstrued as changing the presentstatus of reserve cities and central reserve cities, except in so far as th isA ct chan ges the am oun t of reserv esthat m ay be carried with approvedreserve aqents located therein .

Theorgan ization com m ittee shall have

power to app oin t such assistants and incur such expenses in carryingout the provisions of this Act as

it shall deem necessary, and such expenses shall be payable by theTreasurer of the United S tates up on voucher approved by the S ecretaryof the Treasury, and the sum of$100,000, or so much th ereof as m ay be necessary, is hereby appropriated,out of an y m oneys in the Treasurynot otherwise appropriated, fo r the

pa ym ent o f su ch expenses.


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STOCK ISSUES.

4 S e c . 3 . That the capitalstock of each Federal reserve

bank shall be divided into shares of$100 each. The outst an ding capi-tal stock shall be increased fromtime to time as member banks in-crease their cap ital st ock or as a ddi-tional banks become members, andshall be decreased as member banksreduce their capital stock or ceaseto be members. Ea ch Federa l re-serve' bank may establish branchoffices u nder regulations of t he F ed-eral Reserve Board at points withinthe F ederal reserve distr ict in wh ichit is located: Provided, That thetotal number of such branches shallnot exceed one for each $500,000 ofthe capital stock of said Federalreserve bank.

HOTJSE BILL.

S E C T I O N 3 .


STOCK ISSUES BRANCH OFFICES. B R A N C R 0 F F IC B S


reapitftlEach

Federal reserve bank may shall es-ta blish bra nch offices nnde^ ^e^ela

within the Federal reserve d istrict in wh ich it is located and also in thed istrict o f an y Federal reserve banlcwh ich m ay have been susp ended, such branches to be established and con-ducted at places and under regula-tions approved by the Federal R e-serve Board.

Section 3 was stricken out and the follow-ing inserted:

Se c . 8. Each Federal reserve banlcshall establish branch banks within the Federal reserve district in w hichit is located and m ay do so in the dis-trict o f an y Federal reserve bankwh ich m ay have been suspended.Such branches shall be operated by a board o f directors und er rules andregulations approved by the Federal

R eserv e Board . Directors o f branchbanlcs shall possess th e same qualifica-tions a s d irectors o f the Federal reservebanks. Four o f said directors shallbe selected by the reserve bank andthree by the Federal Reserve B oard,and they shall hold office during thepleasu re, respectively, of the parentba?ik and the Federal Reserve B oard.The reserve bank shall designate oneof the directors as manager.

FEDERAL RESERVE BANKS.

S e c . 4 . The national banks ineach Federal reserve district unitingto form the Federal reserve banktherein, hereinbefore provided for,shall under their seals, make anorganization certificate, which shallspecifically state the name of suchFederal reserve bank so organized,

the territorial extent of the districtover which the operations of saidFederal reserve bank are to be car-ried on, the city and State in whichsaid bank is to be located, theamount of capital stock and thenumber of shares into which thesame is divided, the names andplaces of doing business of each of

S E C T I O N 4.

FEDERAL RESERVE BANKS.

S ec. 4. When the organization com m ittee shall have establishedFederal reserve districts as providedin section two of this A ct, acertificate shall be fil ed with the Com ptroller of the Cu rrencyshowing the geograph ical lim its o fsuch districts and the Federal re-

serve city d esignated in each of suchdistricts. Th e Com ptroller of theCurrency shall thereupon cause tobe forwarded to each na tional banklocated in each district, and to such other banks declared to be eligibleby the organization committee which may apply therefor, an application blank in form to be approved by

f e d e r a l r e s e r v e b a n k s *

Se c . 4- When the organization com m ittee shall have establishedFederal reserve d istricts as providedin section two o f this A ct, acertificate shall be fil ed w ith the Com ptroller of the Currencyshowing the geographical lim its o fsuch districts and the Federal re-

serve city d esignated in each of suchdistricts. Th e Com ptroller of theCurrency shall thereupon cause tobe forwarded to each national banklocated in each d istr ict, and to such other banks declared to be eligibleby the organ ization comm ittee whichm ay app ly therefor, an application blank in form to be approved by


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the makers of said certificate andthe n umber of shares held by

5 each of th em, and th e factthat the certificate is made

to enable such banks to avail them-selves of the ad vanta ges of this Act.

S

H O U SE 8 I L L .

The said organization certificateshall be acknowledged before a

ju dge of som e cou r t of record ornota ry pu blic; and sha ll be, togetherwith tne acknowledgment thereof,authenticated by the seal of suchcourt, or notary, transmitted to theComptroller of the Currency, whoshall file, record, and carefully pre-serve the same in his office.

Uponthe fifing of such certificate with theComptroller of the Currency asaforesaid, the said Federal reservebank so form ed sha ll become a bodycorporate, and as such, and in thename designated in such organiza-tion certificate, shall have power toperform all th ose acts an to enjoy

C o n t i n u e d .


the organ izat ion comm ittee, wh ichblank shall contain a resolution tobe adopted by the board of directorsof each bank executing such appli-

cation , authorizing a subscription to the cap ital stock o f the Federalreserve bank organizing in that dis-trict in accordan ce with the provi-sions of this A ct

When the minimum amount ofcapital stock prescribed by this Act

for the organiza tion o f an y Federalreserve bank shall have been sub-scribed and allotted the organization comm ittee shall designate an y Jivebanks of those whose applicationshave been received, to execute a cer-tificate of organization , and there-upon the banks so designated shall,under their seals, make an organi-za tion certificate wh ich shall sp ecifi -cally state the nam e o f such Fed-eral reserve bank, the territorial ex-tent of the district over which theoperations of such Federal reservebank are to be carried on , thecity and S tate in which said bankis to be located, the amount of capi-tal stock and the number of sharesin to w hich the sam e is divided,the name and place of doing busi-ness of each bank executing such certificate, and of all banks which have subscribed to the capital stockof such Federal reserve bank andthe num ber o f shares subscribed byeach, an d the fa ct that the certificateis made to enable those banks exe-cuting same, and all banks which have subscribed or may th ereaftersubscribe to the capital stock of such Federal reserve bank, to avail them selves of the advantages o f this A ct.

The said organization certificateshall be acknowledged before a judgeo f som e court o f record or notarypu blic; and sh all be, together with theacknowledgment thereof, authenticatedby the seal of such cour t or notary,transmitted to the Comptroller of theCurrency, who shall file, record, andcarefully preserve the sam e in hisoffice.

Upon the filing of such certificatewith the Com ptroller of the Currencyas aforesaid, the said Federal reservebank sh all becom e a body corporateand as such, and in the name desig-nated in such organization certificate,shall have pow er

Firs t. To adopt and use a corpo-rate seal.

E C T I O N 4

the organ ization com m ittee, whichblank shall contain a resolution tobe adopted by the board o f directorsof each bank executing such appli-

cation, authorizing a subscription to the capital stock o f the Federalreserve bank organ izing in that dis-trict in accordan ce with the provi-sions of this Act.

When the minimum amount ofcapital stock prescribed by this Act

for the organizat ion oi any Federalreserve bank shall have been sub-scribed and a llotted, the organizat ioncom m ittee shall designate an y fiv ebanks of those whose applicationshave been received, to execute a cer-tificate of organization, and there-upon the banks so designated shall,under their seals, make an organi-za tion certificate which shall sp ecif i-cally state the name of such Fed-eral reserve bank, the territorial ex-tent of the district over which theoperations oi such Federal reservebank are to be carried on, thecity and S tate in which said bankis to be located, the am ount oi cap i-tal stock and the number of sharesin to wh ich the sam e is divided,the name and place oi doing busi-ness oi each bank executing such certificate, and oi all banks which have subscribed to the capital stockoi such Federal reserve bank andthe num ber oi shares subscribed byeach , and the iact that the certificateis made to enable those banks exe-cuting same, and all banks which have subscribed or m ay th ereaitersubscribe to the capital stock oi such Federal reserve bank, to avail them-selves oi the advantages oi this Act.

The said. organization certificateshall be acknowledged beiore a judgeoi some court oi record or notary

pu blic; and shall be, together with theacknowledgment thereoi, authenticatedby the seal oi such court, or notary,

transm itted to the Com ptroller oi theCurrency, who shall fil e, record andcareiully preserve the same in hisoffice.

Upon the filing oi such certificatewith the Comptroller oi the Cu rrencyas aioresaid, the said Federal reservebank shall become a body corporateand as such, and in the nam e desig-nated in such organ ization certificate,shall have power

First . To adopt and u se a corpo-rate seal.



11/58

11

all those privileges and to exerciseall those powers described in sectionfiftyone hundred and thirtysix,Revised Statutes, save in so far as

th e same shall be limited by t he pr o-visions of th is Act . The Feci oralreserve bank so incorporated shallhave succession for a period oftwent y years from its organization,unless sooner dissolved by Act ofCongress.

s

H O U S E B I L L .

Every Federal reserve bank shallbe conducted under the oversightand control of a board of directors,whose powers shall be the same asthose conferred upon the boards of


S econd. To have succession fo r aperiod o f twenty years from , its organ i-za tion unless it is sooner dissolved hyan Act of Congress, or unless its

franchise becom es forf eit ed hy som eviolation o f law.

Third . To m ake contracts.Fourth. To sue and he sued , com -

pla in and defend , in an y court of law or equity.

Fif th . To appoin t hy its hoard ofdirectors, elected as hereinafter pro-videdj such officers as are not other-wise proinded for in this A ct, to definetheir du ties, require honds o f them and fix the penalty thereof, to dism isssuch officers or an y o f them as m ay heappointed hy them at pleasure, and toappoint others to fill their places.

3 C T I O N 4 C o n t i n u e

S ixth. To prescribe hy its hoard ofdirectors hylaws not inconsistentwith law, regulating' the man ner in wh ich its general bu siness may he con-ductedI, and the privileges granted toit hy law m ay be exercised and en-

joyed .S eventh . To exercise by its board

o f directors}or d uly auth orized officersor agents, all powers specifically granted by the provisions o f this A ctand such incidental powers as shall

he necessary to carry on the businessof hank ing with in the lim itations prescribed by th is Act.

Eigh th . Upon deposit with theT reasurer of the United S tates of an ybonds o f the United S tates in the m an-ner provided hy existing law relatingto na tional hanks, to receive from theComptroller o f the Cu rrency circula t-in g notes in blank , registered andcountersigned as provided by law,equal in amount to the par value ofthe honds so deposited, such notes tobe issued under the same conditionsand provisions of law which relate to

the issue o f circula ting n otes o f na-tiona l hanks secured by bonds of theUnited States hearing the circulating

privilege, except that the issue ofsuch notes shall not be lim ited to theam ount of the capital stock o f suchFederal reserve bank.

B u t no Federal reserve bank shalltransact any business except such asis incidental and necessarily pre-lim ina ry to its organization u ntil ithas been au thorized by the Comp-troller of the Cu rrency to com m encebusiness under the provisions of this

A ct.

Every Federal reserve bank shallbe conducted under the oversightsupervision and control of a board

Second,. To have succession fo r


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12

S E C T I O N 4 C o n t i n u e d .

directors of national banking asso-ciations under existing law, not in-consistent with the provisions ofthis Act.

H O U S E B I L L

Such boards of directorsshall be constituted and elected as

hereina fter specified an d sha ll6 consist of nin e member s, hold-

ing office for three years,and divided int o thr ee classes, desig-nated as classes A, B, and C.

Class A shall consist of threemembers, who shall be chosen byand be representative of the stock-holding banks.

Class B shall consist of threemembers, who shall be representa-tive of the general public interestsof the reserve district.

Class C shall consist of threemembers, who shall be designatedby the Federal Reserve Board.

Director s of class A sha ll be chosenin the following manner:


The board of directors shall 'per-form the duties usu ally ap pertain in gto the office of directors of banking as-sociations and all such duties as areprescribed by law .

S aid board shall adm inister the af-fa irs o f said bank fa irly an d im pa r-tially and without discrim ination in

fa vor o f or against any 'member bankor banks a,nd shall, subject to the pro-visions of law and the orders of theFederal Reserve Board, extend to each member bank such discounts, ad-vancem ents, and accom m odations asm ay be safely and reasonably m adewith du e regard fo r the claims an d de-mands of other member banks.

Such board of directors shallbe eenskkttfced and e leeted selectedas hereinafter specified and shallconsist of nine members, holdingoffice for th ree years, an d dividedinto three classes, designated asclasses A, B, and C.

Class A shall consist of threemembers, who shall be chosen byand be representative of the stock-holding banks.

Class B shall consist of threemembers, who shallborepyesenfea

their election shall be actively en-gaged in their district in com m erce,in agriculture, or in som e other ind us-trial pursuit.

Class C shall consist of threemembers, who shall be designatedby the Federal Reserve Board.When the necessary subscriptions tothe capital stock have been obtained

for the organizat ion o f an y Federalreserve bank, the Federal ReserveBoard shall a ppoin t the class C direc-tors h erein provided fo r and shalldesignate one of such, directors aschairman o f the board to be selected.Pend ing d esignation o f such chair-man the organization committee shall,as provided in this section, exercisethe powers and duties appertaining to the office of chairm an in the organ i-

za tion o f such Federal reserve bank

N o S enator or R epresen ta tive in Congress sh all be a m ember of theFederal Reserve Board, a director ofa Federal R eserve B an k , or an officeror director o f an y m em ber bank.

N o d irector o f class B or o f d oss Cshall be an officer, director, em ployee,orstockholder of an y bank


The board of directors shall per-form the duties usu ally appertain in gto the office of directors of banking as-sociations and all such duties as areprescribed h jj a w .

S aid board shall adm inister the af-fa irs of said bank fa ir ly and im par -tially and without discrim ination in

favor of or against any m ember ban kor banks and shall, subject to the pro-visions of law and the orders of theFederal Heserve Board , extend to each m em ber bank such discoun ts, advance-ments[ , J and accomm odations asm ay be safely and reasonably madewith d ue regard fo r the claim s and de-m ands o f other m em ber banks.

Such board of directors shall be se-lected as hereinafter specified and shallconsist of nine m em bers, hold ing officeor three years, and divided into threelasses, designated as classes A , B ,and C

Class A shall consist of threem embers, who shall be chosen byand be representative of the stock-holding banks.

Class B shall consist o f threemembers, who at the time o f theirelection shall be actively engaged in their district i n comm erce, [ m ] agri-culture[ , ] or som e other ind us-trial pursuit.

Class C shall consist of threem embersm,Jj who shall be design atedby the Federal Reserve Board.When the necessary subscriptions to

the capital stock have been obtainedfor the organiza tion o f any Federalreserve bank, the Federal ReserveBoard shall appoin t the class C direc-tors herein provided fo r3 and shalldesignate one of such directors aschairm an o f the board to be selected.Pending t h e designation of such chairm an, the organ ization com m itteeshall , as provided i n this section, J ex-ercise the powers and du ties appertain -ing to the office o f chairman m the or-ganiza tion of such Federal reservebank.

N o S enator or R epresen ta tive in Congress shall be a m em ber of theFederal Reserve Boardj[,J o r a n o f -f i c e r o r a director of a Federal Re-serve B an k fi, or an officer, or d irector

of any m em ber bank'J.No d irector o f class B [o r of classC] shall be an officer, director , J ob


13/58

13


H O U S E B I L L . P A S S E D B Y S E N A T E .

It shall be the duty of the chair-man of the board of directors of theFederal reserve bank of the districtin which each such bank is situatedto classify the member banks of thesaid district into three generalgroups or divisions. Each suchgroup shall contain as nearly asmay be onethird of the aggregatenumber of said member banks ofthe said district and shall consist,as nearly as may be, of banks ofsimilar capitalization. The said

froups shall be designated by nu mer at the pleasure of the chairman

of the board of directors of the Fed-eral reserve bank.

At a regularly called directorsmeeting of each member ban k in theFederal reserve district aforesaid,the board of directois of such mem-ber bank shall elect by ballot oneof its own members as a districtreserve elector and shall certify hisname to the chairman of the board

of directors of the Federal7 reser ve ban k of th e district.

The said chairman shall es-ta blish lists of th e district reserveelectors, class A, thus named bybanks in each of the aforesaid threegroups and shall tra nsmit one list,to each such elector in each group.

Directors of class A and class B shall be chosen in the followingmanner : ^

chairman of the board of directorsof the Federal reserve bank of thedistrict in which eaehsueh the bankis situated to or, pending the ap-pointm ent o f such chairm an , the or-ganiza tion com m ittee shall class ify th emember banks of the said districtinto three general groups or divi-sions. Ea ch suefegroup shall cont ain ,

as near ly as may be, oneth ird of theaggregate number of said the mem-ber banks of the said district, andshall cons ist, as nea rly as m ay be,of banks of similar capitalization.The said groups shall be designated

effeheedeFal^eseHebafife.At a regularly called efeeefce^s2

meeting of the board of directors ofeach member bank in the Federalr e sew e

it shall elect by ballot oneelitsewftmombersfts a district reserveelector and shall certify his nameto th e chairma n of the board ofdirectors of the Federal reservebank of the district.

The saidchairman shall establish lists of thedistrict reserve electors? class A?thus n amed b y banks in each of theaforesaid three groups and shalltransmit one list to each sehelector in each group. Eve^y

employee , or stockholder3 of anybank.

N O D I R E C T O R O F C L A S S C S H A L L

B E A N O F F I C E R , D I R E C T O R , E M

P L O Y E E O R S T O C K H O L D E R O F A N Y

B A N K .

Directors o f class A an d class B shall be chosen in the followin gmanner:

The chairman of the board of di-rectors of the Federal reserve banlc o fthe district in which the banlc is situ-ated or, pendin g the app ointm entof such chairman, the organization com m ittee shall classify the m em-ber bank s of the d istrict in to three gen-


eral groups or div isions . Each groupshall contain as n early as m ay beonethird o f the aggregate num ber ofthe member banks of the district andshall consist, as nearly as m ay be, ofbanks of sim ilar capitalization. Th egroup s shall be designated by n um berby the chairm an .

A t a regu larly called m eeting o f theboard of d irectors o f each m em ber bankin the dist rict it shall elect by ballot adis trict reserve elector and shall certify his nam e to the chairm an of the boardof directors of the Federal reservebank of the district.

The chairman shall JEestablish'J m a k e lists of thedistrict reserve electors thus named bybanks in each o f the aforesaid threegroups and shall transmit one list toeach elector in each group .

E A C H M E M B E R B A N K S H A L L B E P E R

M I T T E D T O N O M I N AT E l 'O T H E C H A I R

M A N O N E C A N D I D AT E F O R D I R E C T O R

O F C L AS S A A N D O N E C A N D I D A T E F O R

D I R E C T O R O F C L AS S B . T H E C AN D I

D A T E S S O N O M I N A T E D S H A L L B E

L I S T E D B Y T H E C H A I R M A N , IN D I C A T

I N G B Y W H O M N O M I N A T E D , A N D A

C O P Y O F S A ID L I S T S H A L L , W I T H I N

F I F T E E N D A YS AF T E R I T S C O M P L E

T I O N , B E F U R N I S H E D B Y T H E C H A I R

M A N T O E A C H E L E C T O R .


14/58

14

sHOUSE BILL*

Every elector shall, within fifteendays of the receipt of the said list,select and certify to the said chair-man from among the names on thelist pert ainin g t o his group, tran s-mitted to him by the chairman, onename, not his own, as representinghis choice for Federal reserve di-rector, class A. The name receiv-ing the greatest number of votes,not less than a majority, shall bedesignated by saia chairman asFederal reserve director for thegroup to which he belongs. In caseno candidate shall receive a ma-jor it y of all votes cast in any gr oup,the chairman aforesaid shall estab-lish an eligible list, consisting ofthe t hree names receiving t he great-est number of votes on the first

ballot, and shall transmit said listto the electors in each of the groupsof banks established by him. Ea chelector shall at once select andcertify to the said chairman fromamong the three persons submittedto h im his choice for Federa l reservedirector, class A, and the name re-ceiving the greatest number of suchvotes shall be declared by the chair-man as Federal reserve director,class A. In case of a tie vote th eballoting shall continue in the man-ner hereinbefore prescribed untilone candidate receives more votes

than either of the others.8 Director s of class B shallbe chosen by the electors of

the respective groups at the same

S D63-2vol 25--- 10

E C T I O N 4 C o n t i n u e


firsfe bftUefc*- an d sh al l itsa i d \ is fcfeefckeeleefee+s e k

by-h Eaeh-eleefcer-shftH-a&'Ottee

eeleefcattdeertifytefche^ftidebairma Hlf efB~am eftgtheth :Feepe+ sensbn b m i fefced-fce-h is-ebe iee-f or- Fe4-eHtfclreHe'Fedi+,eeteF?~elH9sAâii4thenamereeeiv-mgthegr ea fees &iHftbe-F-ef-9ehvefees-shftH-bede-elared-byfebe-ebai-Fffian-as-Fede m \ reservedi+eefceFyelassA:Ineaseef-a-fc i e~v efce-fcbe-baUefc ing-9 ha U-een-ifmeinthemanne r-fe ere i nb ele re

p Feseribedtt nt ileneeaftdidatereee iês-ffi e? evetesthane itherefthe-ether9r

spe efciêgr ep9-afc--fche--9am e--fcHeandm -the -sa m e-ma me-F-p-F ese r ib ed #o -fdi re et er se#~e la 99--A,exee ptt b a t t h e y m t i s t b e g e l e e t e d fr e m a

Iisfceffi f tme94t iri i i9hedr enebyefteh

in n eea se be th e9 ee# ~e ffieer 9er

d i r ee t er 9e#a n ybftfikeFba n k in g

a s s e e i a t i e fh Every elector sh all, within fifteen

days after the receipt of the said list,certify to the chairm an his firs t, sec-ond, and other choices of a director ofclass A and class B , respectively,up on a preferential ballot, on a form

fu rn ish ed by the chairm an of theboard of directors of the Federal re-serve bank of the district. Each elector shall m ake a cross opposite thenam e of the fir st , second, and otherchoices for a director of class A and

for a d irector of class B , but shall notvote m ore than one choice fo r an y onecandidate.

A n y candidate having a m ajority of all votes cast in the column of

fi rst choice shall be declared elected.I f no candidate have a m ajorityof all the votes in the firs t colum n ,then there shall be added togetherthe votes cast by the electors forsuch cand idat es in the second col-um n to the votes cast fo r the sev-eral candidates in the firs t colum n.I f an y candidate then have a m ajorityof the electors voting, by addingtogether the fir st and second choices,he shall be declared elected. I f nocandid ate have a m ajority of electorsvoting when the firs t and secondchoices shall have been added, then the votes cast in the third colum n fo rother choices shall be added togetherin like m anner, and the candidate

then having the highest num ber ofvotes shall be declared elected. A n im m ediate report o f election shall bedeclared.


Every elector sh all, within fifteen .days after the receipt of the saia list,certify to the chairm an his firs t, sec-ond, and other choices ofcl director ojclass A and class B, respectively,up on a p referential ballot, on a form

fu rn ish ed by the chairm an of theboard of directors of the Federal re-serve bank of the district. Each elector shall m ake a cross opposite thenam e of the first , second, and otherchoices fo r a d irector of class A and

for a director of class B , but shall notvote m ore than one choice fo r an y onecandidate.

A n y candidate having a m ajori ty of all votes cast in the colum n of

fi rs t choice shall be declared elected.I f no candidate have a m ajori ty ofall the votes in the firs t colum n , then

there shall be added together the votescast by the electors fo r su ch candid atesin the second colum n J o] a n d the votescast fo r the several cand idates in the

fi rst colum n. I f an y candidate thenhave a m ajority o f the electors voting,by add ing together the fir st and secondchoices, he shall be declared elected.I f no candidate have a m ajori ty ofelectors v oting w hen the fir st andsecond choices shall have been added,then the votes cast in the third colum n

for other choices shall be add ed to-gether in like m ann er, and the cand i-date then having the highest num ber of

votes shall be declared elected. An im m ediate report of election shall bedeclared.


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15


HOUSE BILL* P A S S E D B Y S E N A TE . CONFERENCE AGREEMENT*

time and in the same manner prescribed for directors of class A, except th at they m ust be selected from a list of names furnished, one by

each member bank, and such namesshall in no case be those of officers or directors of any bank or bank ingassociation. Th ey shall not accept office as such du ring th e ter m of their service as directors of the Federalreserve ban k. Th ey shall be fairlyrepresentative of the commercial,agricultural, or industrial interestsof th eir resp ective distr icts. The Federal Reserve Board shall havepower at its discretion to remove any director of class B in any Federal reserve bank , if it should appear

a t an y t ime th at such director d oesnot fairly repr esent th e commercial,agricultural, or industrial interestsof his district.

Three directors belonging to classC shall be chosen directly by the Feder al Reserve Board , and shall beresidents of the district for which th ey ar e selected, one of whom sha llbe designated b y said board as chairman ol the board of directors of the Federal reserve bank of the district to which he is appointed and shallbe designated as Feder al r eserveagen t. He shall be a person of

tested banking experience; and in addition to his duties as chairman of the board of directors of the F ederal reserve bank of the district to which he is appointed, he shall be required to maintain un der regulations to be established by the Fed

eral Reserve Board a local9 office of said boa rd , which

shall be situated on thepremises of the Fed eral reserve bankof the district. He sha ll make regular reports to the Federal Reserve Board, and shall act as its official representative for the performance

of the fun ctions conferred u pon it b y this Act. He shall receive an annual compensation to be fixed by the Federal Reserve Board and paid monthly by the Federal reserveban k to which he is designated .

Tfaoy-sh all- ne fcaeeeptr e f-

hr teresfcs-ef-h is-d isfcriefc.-Thr ee directors belonging to class

C shall be ehesen appointeddirectly by the Federal Reserve Board, and shall fee have beenfor at least two yearsresidents of the district for which they are selected appointed, one ofwhom shall be designated by said board as chairman of the board ofdirectors of the Federal reserve bank of the district to which he isappointed and shall be designated

by said board as Feder al reservea gen t. He shall bo a person oftested banking experience; and in addition to his duties as chairman of the board of directors of the Federal reserve bank of the districtto which he is appointed, he shallbe required t o maintain u nder regulations to be established by the Federal Reserve Board a localoffice of said board, which shall be situated on the premises of the Federal reserve bank of the distr ict. He shall mak e regular reports to t he Federal Reserve Board,

and shall act as its official representative for the performance ofthe functions conferred upon it by this Act. He shall receive an annual compensation to be fixed bv the Feder al Reserve Board an d paiclmonthly by the Federal reservebank to which he is designated.One of the directors of class C whoshall be a person of tested bankingexperience shal be appointed bythe Federal Reserve Board as dep-uty chairman and deputy Federalreserve agent to exercise the powers ofthe chairman of the board and Fed-eral reserve agent in case of the ab-sence or disability of his principal.

[ Th ree directors belonging to class]J C l a s s C d i r e c t o r s shall be ap-poin ted directlyJ by the FederalReserve Board fc, an d% t h e y shallhave been for at least two yearsresidents of the district for which they are appointed, one of whom shall be designated by said board aschairman of the board of directorsof the Federal reserve bank[ o f thedistrict to which he is appointed^

and shaU be designated by saw,boardJ as u Federal reserve agent

He shall be a person of tested ban kingexperience; and in add ition to hisduties as chairman o f the board of di-rectors of the Federal reserve bankT ofthe district to which he is appointed, J he shall be required to maintain u nderregulations to be established by theFederal Reserve Board a local office ofsaid boards, which shall be situatedj on the prem ises of the Federal reservebank[ of the district^ . He shall makeregular reports to the Federal ReserveBoard, and shall act as its official

representative fo r the perform ance o fthe functions conferred upon it bythis Act. He shall receive an an -nu al com pensation to be fixed bythe Federal Reserve Board and paidmonthly by the Federal reserve bankto which he is designated. One ofthe directors of class O, who shall bea person of tested banking experience,shall be appointed by the FederalReserve Board as deputy chairm an and deputy Federal reserve agent toexercise the powers of the chairman of the board and Federal reserve agentin case of absence or disability of his

pr in cipal .


16/58

16

S E C 1 J O N 4 C on t i n u e d

Directors of Federal reserve banksshall receive, in addition to anycompensation otherwise provided, areasonable allowance for necessary

expenses in attending meetings oftheir respective boards, whichamount shall be paid by the re-spective Federal reserve banks.Any compensation that may beprovided by boards of directors ofFederal reserve banks for membersof such boards shall be subject toreview by the Federal ReserveBoard.

H O U S E B I L L .

The Reserve Bank Organization

Committee may, in organizing Fed-eral reserve banks for the first time,call such meetings of bank directorsin the several districts as may benecessary to carry out the purposesof this Act and may exercise thefunctions herein conferred upon thechairman of the board of directorsof each Federal reserve bank pend-ing the complete organization ofsuch bank.

At the first meeting of thefull board of directors of eachFederal reserve bank after organi-

zation it shall be the duty of

10 th e directors of classes A an dB and C, respectively, to

designa te one of the members ofeach class whose term of office shallexpire in one year from the first ofJanuary nearest to date of suchmeeting, one whose term of officeshall expire at the end of two yearsfrom said date, and one whose termof office shall expire at the end ofthr ee years from said dat e. There-after every director of a Federalreserve ban k chosen as hereinbeforeprovided shall hold office for a termof three years; but the chairman of

the board of directors of each Fed-eral reserve bank designated by theFederal Reserve Board, as herein-before described, shall be removableat the pleasure of the said boardwithout notice, and his successorshall hold office during the unex-pired term of the director in whoseplace he was appoint ed. Vacan ciesthat may occur in the severalclasses oi directors of Federal re-serve banks may be filled in themanner provided for the originalselection of such directors, suchappointees to hold office for the

unexpired terms of their prede-cessor .


Directors of Federa l reserve banksshall receive, in addition to anycompensation otherwise provided,a reasonable allowance for neces-

sary expenses in attending meet-ings of their respective boards,which amoun t shall be paidby the respective Federal reservebanks. Any compensation thatmay be provided by boards of di-rectors of Federal reserve banks formembers of such boards shall besubject to review and subsequentreadjustm ent at any time by the Fed-eral Reserve Board.

The Reserve Bank Organization

Committee may, in organizing Fed-eral reserve banks for the first time,call such meetings of bank directorsin the several districts as may benecessary to carry out the purposesof this Act, and may exercise thefunctions herein conferred upon thechairman of the board of directorsof each Federal reserve bank pend-ing the complete organization ofsuch bank.

At the first meeting of the fullboard of directors of each Federalreserve bank after organization itshall be the duty of the directors of

classes A andB and C, respectively,to designate one of the members ofeach class whose term of office shallexpire in one year from the first ofJanuary nearest to date of suchmeeting, one whose term of officeshall expire at the end of two yearsfrom said date, and Qne whose termof office shall expire at the end ofthr ee years from said dat e. There-after every director of a Federal re-serve ban k chosen as herein-before pr ovided sha ll h old officefor a te rm of th ree yea rs $b fcthe

Directors of Federal reserve banksshall receive, in addition to anycom pensation otherwise provided,a reasonable allowan ce for neces-sary expenses in attenaing m eetings of th eir respective boards,which am ount shall be paidby the respective Federal reservebanks. A n y com pen sation that m ay be provid ed by boards of directors ofFederal reserve banks for [ membersof such boards'J d i r e c t o r s , o f f i c e r s o r e m p l o y e e s shall be sub-ject to prev iew an d subsequ ent read -justm ent at any tim e by ] t h e a p p r o v a l o f the Federal Reserve

B oard .The Reserve Bank Organization

Com m ittee m ay, in organ izing Federalreserve banks for the first timeJ ,call such m eetings o f bank d irectorsin the several dist ricts as m ay benecessary to carry out the purposes of this Act, ana m ay exercise the

fu n ction s herein conferred upon thechairman of the board o f directorsof each Federal reserve bank pend-ing the complete organ ization o fsuch bank.

A t the fi rst m eeting o f the fu l l board of directors of each Federalreserve bank, R after orga n izat ion ,] itshall be the du ty o f the directors o f

classes A , [a n d ] B and C, respect-ively , to designate one of the m em bers ofeach class wh ose term o f office shallexpire in one year from the first of

J an uary nearest to date o f such m eeting, one wh ose term o f officeshall expire at the end of two years

fr om said date, and one whose term of office shall expire at the end ofthree years from said d ate. There-after every director of a Federalreserve bank chosen as herein-before provided shall hold office


r l i i rvtITvvvvT IT

point ed. Vacan cies th at ma y occurm the several classes of directors ofFederal reserve banks may be filledin the manner provided for theoriginal selection of such directors,such appointees to hold office forthe unexpired terms of t heir pred-

ecessors.

for a term of three years. Va -cancies that m ay occur in theseveral classes of directors of Federalreserve banks m ay be filled in them anner provided fo r the originalselection of such directors, such ap-

poin tees to hold office f or the unex-

pired term s o f th eir p redecessors.


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I N C R E A S E A N D D E C R E A S E O F C AP I

T A L .

H O U S E B IL L .

S e c . 5. Tha t shares of th e capita lstock of Federal reserve banks shallnot be transferable, nor be hy

othecated In case a memberank increases its capital, it shall

thereupon subscribe for an addi-tional amount of capital stock ofthe Federal reserve bank of its dis-trict equal to twenty per centum of

the banks own increase of11 capita l, oneha lf of said su b-

scription to be paid in cashin the mann er hereinbefore pr ovidedfor original subscription, and oneha lf to become a liability o themember bank according to theterms of the original subscription.

A bank applying for st ock in a F ed-eral reserve bank at any time afterthe form at ion of the latter mustsubscribe for an amount of the capi-tal of said Federal reserve bankequal to twenty per centum of thecapital stock of said subscribingbank, paying therefor its par valuein accordance with the terms pre-scribed by section two of this Act

When the capital stock of any Fed-eral reserve ban k ha s been increasedeither on account of the increase ofcapita l stock of member ban ks or onaccount of the increase in the num-ber of member banks, the board ofdirectors shall make and execute acertificate to the Comptroller of theCurrency showing said increase incapital, the amount paid in, and bywhom paid. In case a memberbank reduces its capital stock itshal surrender a proportionat e

amoun t of its holdings in th e capita l


S T O C K I S S U E S ; I N C R E A S E AN D D E

C R E A S E O F C A P I T A L .

S e c . 5 . Thatsha^es The capital

stock of each* Federal reserve bankshall be divided into shares of $100each . The outstanding capital stockshall be increased from tim e to tim e asm em ber banks increase their capita lstock and surplus or as additionalbanks become mem bers, and m ay bedecreased as member banks reducetheir capital stock or surplus or ceaseto be m embers.

Shares of the capita lstock of Federal reserve banksowned by member banks shall not betransferable, nor be hypothecatedhypothecable. I n case a memberbank ine^'eases increase its capitalstock or surplus, it shall thereuponsubscribe for an additional amountof capital stock of the Federal re-serve bank of its district equal totwenty six per centum of theba nkasown said increase efeapifcal, onehalf of said subscriptionto be paid ineasb in the ma n-ner hereinbefore provided for orig-inal subscriptioi^, and onehalf te

e*ii4sttbse*4pfcieft subject to call

of the Federal Reserve Board. Ata n k applying for stock in a Federalreserve bank at any time after the

thereof m ustsubscribe for an a mountof the capital stock of said theFederal reserve bank equal totwenty six per centum of the paid up capital stock and surplus oi saidsubse^ibiftg applicant bank, payingtherefor its par value maeee^danee

tweeffeh isAefc plus onehalf of oneper centum a month from the periodof the last dividend .

When t he capi-tal stock of any Federal reservebank has shall have been increasedeither on account of the increase ofcapit al st ock of member ban ks or onaccount of the increase in the num-ber of member banks, the board ofdirectors shall m ak ean dexeetrtecause to be executed a certificate tothe Comptroller of the Currencyshowing said the increase in capitalstock, the amount paid in, ana bywhom paid. In case a memberbank reduces its capital stock itshall surrender a proportionate

amoun t of its holdings in the capital

S E C T I O N 5 .

S T O C K I S S U E S ; I N C R E A S E AN D D E

C R E A S E O F C A P I T A L .

S e c . 5 . The capital stock of each Federal reserve bank shall be dividedinto shares of $100 each . The out-standing capital stock shall be in -creased from time to tim e as m em berbanks increase their capital stock andsurplus or as additional banks be-com e m embers, and m ay be decreasedas member banks reduce their capitalstock or surplus or cease to be mem-bers.

Shares of the capital stock of Fed-eral reserve banks owned by m emberbanks shall not be ['transferablenor be hypothecable] t r a n s f e r r e d O R H YP O T H E C A T E D . CaseJw h e n a member bank ^ increase Ji n c r e a s e s its capital stock or sur-

plu s, it shall th ereupon subscribefor an ad ditional am oun t o f cap italstock o f the Federal reserve bank o fits district equal to six per centum of the said increase, onehalf o fsaid subscription to be paidin the m anner hereinbeforeprovid ed for origin al su bscrip tion ,and onehalf subject to call of the


Federal Reserve Board. A ban kapp lying fo r stock in a Federal re-serve bank at any tim e after theorganization thereof must subscribe

for an am oun t o f the cap ital stock o fthe Federal reserve bank equal to six per centu m of the paid up cap italstock and surplus of said applicantbank, paying therefor its par valueplus on ehalf o f one per centum am onth from the period of the last

dividend. When the capital stockof any Federal reserve bank sha ll havebeen increased either on account o f theincrease of capital stock of memberbanks or on account of the increasein the nu m ber of member banks, theboard of directors shall cause to beexecuted a certificate to the Com ptrollero f the Cu rrency showing the increasein capital stock, the amount paid in ,

and by whom paid. In caseJ w h e n a m em ber bank reduces its capita l stockit shall surrender a proportionate

am ount of its holdings m the capital


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H O U S E B IL L . P A S S E D B Y S E N A T E . C O N F E B E N C E A G P E E M E N T .

of said Federal reserve bank, and incase a member ba nk goes int o volun -tary liquidation it shall surrenderall of its holdings of the capitalstock of said Federal reserve bank.In either case the shares surr enderedshall be canceled and such memberbank shall receive in paymenttherefor, under regulations to beprescribed by the Federal ReserveJBoard, a sum equal to its cash paidsubscriptions on the shares surren-dered.

of said Federal reserve bank, and incase a member ban k goes into volun-tary liquidation it shall surrenderall of its holdings of the capit al st ock

of said Federal reserve bank and bereleased front its stock su bscription not previously called.

In eitluT ease the shares sur-rendered shall be canceled andsuch m ember ban k shall receivein payment therefor, under regula-tions t o bo prescribed by the FederalReserve Board, a sum equal to itscash paid subscriptions on theshares surrendered and onehalf ofone per centum a month from the

per iod of the last dividend, not toexceed the book value thereof, less anyliability of such member bank to the

Federal reserve bank.

of said Federal reserve bank, and.caseJ w h e n a member bank goesinto voluntary liquidation ] v o l u n t a r i l y l i q u i d a t e s it shall surrender

all of its holdings of the capita l stock ofsaid Federal reserve bank and be re-leased. from it s stock su bscrip tion notprev iou sly called. In eith er case theshares surrendered shall be canceledand HsucJiJ t h e member bank shallreceive in paym ent therefor,un der regu-lations to be prescribed by the Federal

R eserve Board , a sum equal to it scashpaid subscriptions on theshares surrendered and onehalf ofone per centum a m onth from the

period of the last dividend , not toexceed the book value thereof\ less anyliability of such member bank to theFederal reserve bank

S E C T I O N 6 .

12 S e c . 6. That if any mem-ber bank shall become in-

solvent and a receiver be appointed,the stock held by it in said Federalreserve bank shall be canceled andthe balance, after deducting fromthe amount of its cash paid sub-scriptions all debts due by such in-solvent ba nk to said Federal reserve

bank , shall be paid to th e receiver ofthe insolvent bank.

Whenever thecapital stock of a Federal reservebank is reduced, either on accountof a redu ction in capita l stock of anymember bank or of the liquidationor insolvency of any such memberbank, the board of directors shallmake and execute a certificate tothe Comptroller of the Currencyshowing such reduction of capitalstock a ad th e am oun t r epaid to suchbank.

baftk I f any m ember ban k shall bedeclared insolvent and a receiver ap-

poin ted th erefor, the stock held by itm said Federal reserve bank shall be can-celed, and all cashpaid subscriptionson said stock, w ith oneha lf of one percentum, per m onth from the period o flast dividend, not to exceed the bookvalue th ereofsh all be first ap plied toall debts of the insolven t member bankto the Federal reserve banlc, and thebalance, i f an y, shall be paid to thereceiver of the insolvent bank. When-ever the capital stock of a Federal

reserve bank is reduced, either onaccount of a reduction in capitalst ock of any member ban k or of theliquidation or insolvency of aiaysuehffieffibe* such bank, the boardof directors shall makeand6X6011^6 cause to be executed acertificate to the Comptrollerof the Currency showing such re-duction of capital stock and theamount repaid to such bank.

S e c . 6 . I f any m ember bank shall bedeclared insolvent and a receiver ap-poin ted th erefor, the stock held by i t m said Federal reserve bank sh all be can-ce led W I T H O U T I M P A IR M E N T O F I T Sl i a b i l i t y , and all cashpaid subscrip-tions on said stock, with onehalf of oneper centu m per m onth from the periodof last dividend, not to exceed the bookvalue thereof, shall be first applied toall debts of the insolvent m ember bankto the Federal reserve bank, and thebalance, if any, shall be paid to thereceiver of the insolvent bank. When-ever the capital stock of a Federalreserve bank is reduced, either on account of a reduction in capitalstock of any member bank or of theliquidation or insolvency of such bank, the board of directors shallcause to be executed a certi-

fi ca te to the Com ptroller ofthe Currency showing such re-duction of capital stock and theam ount repaid to cuch bank.


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HOUSI BILLr

D I V I S IO N O F E A R N I N G S

S e c . 7 . That after the payment ofall necessary expenses and ta xes of aFederal reserve bank, the memberbanks shall be entitled to receive anannual dividend of five per centumon the paidin capital stock, whichdividend shall be cumula tive. Onehalf of the net earnings, after theafoi waid divid en d cla ims h a ve beenfully met, shall be paid into a sur-plus fund until such fund shallamount, to twen ty per centu m ofthe paidin capital stock of suchbank, and of the remaining onehalfsixty per centum shall be paid tothe United States and forty per

centum to the member banks inthe ra tio of their average13 balan ces with th e Federal re-

serve bank for the precedingyear. When ever and so long as th esurplus fund of a Federal reservebank amounts to twenty per centumof the paidin capital stock and themember banks shall have receivedthe dividends at the rate of five percentum per annum hereinbeforepr ovided for, s ixty per cent um of allexcess earnings shall be paid to theUnited States and forty per centumto the member banks in proportion

to their annual average balanceswith such Federal reserve bank;

S E C T I O N 7 .

P A S S E D B Y S E N A T E . C O N F E R E N CE A GR E E M E N T .

D I V I S IO N O F E A R N I N G S . DIV IS IO N O F E A R N IN GS .

e f Af ter all necessary expenses andtaxes of a Federal reserve bankhave been p aid or provided fo r, thememberbftftbs stockholders shall beentitled to receive an annual divi-dend of five six per centum on thepaidin capital stock, which divi-dend shall be cumu lative. Onehalf of the net earnings, after theaforesaid dividend claims have beenfully met, shall be paid into a sur-plus fund until such fund shallamount to fcwenfcyfor ty per centu mof the paidin capital stock of suchbank, and of the remaining one

half s i fi ft y per centum shall bepaid to the United States ftadforty

chise tax, and fif ty per centum shallbe paid to the un ited S tates, as atrustee fo r the benefit of depositorsin all fai led m em ber banks in theUnited S tates, and failed member

trust com panies in the D istrict ofColumbia, the m oney to be kept in andlosses from failu res to be paid from itas a d epositors insurance fun d undera div ision o f the Treasury to be con-stituted and managed under such reg-

ula tions as m ay be prescribed by theS ecretary of the T reasury. Wheneverthe S ecretary erf the T reasu ry, out ofsaid fu n d , shall pay any am ounts dueto depositors offa il ed m ember banks,the S ecretary of the T reasury shall besubrogated to all the rights of said de-

posit ors, and in the settlem ent o f theaffairs o f an y such bank all dividendsthat would have been due to such de-posi tors shall be paid to the S ecretaryo f the T reasury , and the sam e shall bety him paid into and, become a partoj said depositors insurance fun d.

Se c . 7. A ft er all necessary ex-pen ses o f a Federal reserve ban k havebeen paid or provided for, the stock-holders shall be entitled to receive an ann ual dividend of six per centum on the paidin capital stock, which divi-dend shall be cum ulative. Onehalfof the net earnings, afterJ A f t e r theaforesaid dividend claim s have been

fu l ly m et,f^ shall be paid in to a su r-plu s fu nd un ti l such fu n d sh odam ount to forty per centum of thepaid in cap ital stock o f such bank,and o f the rem aining oneha lf fifty

per centu m ] a l l t h e n e t e a r n i n g s shall be pa id to the United S tates

as a franchise tax, f^ and fi ft y percentu m shall be pa id to the UnitedStates, as a trustee for the benefit of

depositors in all fai led m em ber banksin the United States, and failed mem-ber trust com pan ies in the Dist rict ofColum bia, the m oney to be kept in andlosses from failu res to be paid from it as a d epositors' insu rance fun dunder a division of the Treasury tobe constituted ana managed undersuch regulations as m ay be prescribedby the S ecretary of the Treasury.Wh enever the S ecretary of the Treas-

u ry , out of said fu n d , shall pay any am ounts due to depositors of failedmember banks, the S ecretary of theTreasury shall be subrogated to allthe rights of said depositors and in the settlement of the affairs of anysuch bank all dividends that wouldhave been du e to such depositorsshall be pa id to the S ecretary ofthe Treasury, and the same shall beby him paid into and become a partof said depositors1insurance fu n d iE X C E P T T H A T O N E - H A L F O F S U CH

N E T E A R N I N G S S H A L L B E P A I D IN T O

A S U R P L U S F U N D U N T I L I T S H AL L

A M O U N T T O F O R T Y P E R C E N T U M

O F T H E P A I D -I N C A P I T A L S T O C K O F

S U C U B A N K .


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H O U S E B I L L .

aUearnings derived by the United States from Federal reserve banksshall constitute a sinking fund to be

held for the reduction of the outstanding bonded indebtedn ess of the United States, said reduction to be accomplished under regulations tobe prescribed by the Secretary ofthe Treasur y. Should a Federalreserve bank be dissolved or go into

liquidation, the surplus fund of said ban k, after the paymen t of all debts and dividend requirements as hereinbefore provided for, shall be paid to and become the property of the United States.

Every Federal reserve bank incorporated under the terms of thisAct and the capital stock therein held bv member banks shall be exempt from Federal, State, and localtaxation, except in respect to taxes upon real estate.

S e c . 8. That any national banking association heretofore organized

ma y upon application at any14 time within one year after the

passage of this Act , an d with the approval of the Comptroller ofthe Currency, be granted, as herein provided, all the rights, and be sub

je ct to a ll th e lia bili tie s, of na tion albanking associations organized subsequent to the passage of this Act:Provided, That such application on

the part of such associations shallbe authorized by the consent in writing of stockholders owning not less than a majority of the capital stock of th e association. Any national banking association now organized which shall not, within oneyear after the pa ssage of this Act,become a national banking association under the provisions hereinbefore stated, or which shall fail lo comply with any of the provisions of tnis Act applicable thereto, shallbe dissolved; but such dissolution shall not take away or impair any

remedy against such corporation, itsstockholders or officers, for any liability or penalty which shall have previously been incurred.


AU net earningsderived by the United States from Federal reserve banks shall eensfci-

, in the discretion of the Secretary, bevsed to supplement the gold reserveheld against outstanding UnitedStates notes, or shall be applied tothereduction of the outstan ding bondedindebtedness of the United States

under regulations to be prescribed bv the Secretary of the Treasury.Should a Federal reserve bank be dissolved or go into liquidation, fcbe

plus remaining, after the payment of all debts, and dividend requirements as hereinbefore provided,le**? and the par value of the stock,shall be paid to and become the property of the United States andshall be sim ilarly applied.

Ever y Federal reserve bank incorporated under th e terms of this Actand, the capita! stock and surplustherein, h eld-by- memb er -banks andthe incom e derived therefrom shall beexempt from Federal, State, and local taxation, except in respect to taxes upon real estate.

S E C T I O N 8 .

The Senate proposed to eliminate thissection of the House bill.


CAUJT h e net earnings derived bythe United S tates from Federal re-serve banks shall, in the discretion ofthe Secretary, be used to supplement

the gold reserve held against out-stand ing United S tates notes, or shallbe applied to the reduction of the out-standing bonded indebtedness of theUnited States under regulations to be

prescribed by the Secretary ofthe Treas-ury. Should a Federalreserve bank be

dissolved or go into liquidation, anysurplus remain ing, after the paym ent ofaUaebts, dividendreguiremenisash ereinbefore provided, and the par value

of the stock, shall be paid to and be-come the property of the United Statesand shaU be similarly applied.

E very! Federal reserve f^bankr jb a n k s ^ incorporated u nder theterms of this A ctJ , i n c l u d i n gthe capital stock and surplus therein ,and the income derived therefrom shall be exempt from Federal, S tate,and local taxation, except[ m respei it o ] taxes upon real estate.


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S e c . 9 . Tha t any bank or bankingassociation incorporated by speciallaw of any State or of the unitedStates, or organized under the gen-eral laws of any State or the UnitedStates, and having an unimpairedcapital sufficient to entitle it to be-come a nat iona l bank ing associationunder the provisions of existinglaws, ma y, by t he consent in writingof the shareholders owning not lessthan fiftyone per centum of the

capital stock of such bank or15 ban kin g ass ociat ion, an d with

the app roval of the Comp-troller of the Currency, become anational banking association underits former n ame or by a ny name a p-proved by the comptroller.

H O U S E B IL L .

Th edirectors thereof may continue tobe th e directors of the a ssociation soorganized unt il other s are elected orappointed in accordance with theprovisions of the law.

When thecomptroller has given to such bankor banking association a certificatethat the provisions of this Act havebeen complied with, such bank orbanking association, and all itsstockholders, officers, and employ-ees, shall have the same powers andprivileges, and shall be subject toth e sam e dut ies, liabilities, and regu-

lations, in all respects, as shall havebeen prescribed by this Act or b y thena tional bank ing Act for associa-tions originally organized as na-tional banking associations.

P A S S E D B Y S E N A T E

S e c . 9 8. That a**? section fiftyone hun dred and fift yfou r , Un itedStates Revised Statutes, be amendedto read as follow s:

A n y ba nk eFfearftkingasseeiakienincorporated by special law of anySta te or of th e Unit ed States, ororganized under the general lawsof an y Sta te or of the UnitedStates, and having an unimpairedcapita l sufficient to entitle it tobecome a national banking asso-ciation under the provisions ofexisting laws, may, by the eonsent.id "W nfcmg vote of the share-holders owning not less thanfiftyone per centum of the capitalst ock of such bank or bank ing

association, and with the approvedof the Comptroller of the Currencyybcceme be converted into anat ional banking association, un de?

name approved by the Comptrollerof the Currency: Provided, however,That said conversion shall not bein contravention o f the S tate law. In such case the articles o f association andorganizat ion certificate m ay be executedby a m ajority ofth e directors ofthe banlcor banking institution, ana the cer-tificate shall declare that the ownersof fiftyone per centum of the capital

stock have authorized the directors tom ake such certificate and to change orconvert the banlc or banlcing institu-tion into a nat iona l association. A m ajority o f the di?'ectors, aft er execut-ing the articles of association an d theorganization certificate, shall have

pow er to execute all other pa pers andto do whatever m ay be required tom ake its organization perfect andcom plete as a n ational a ssociation.Th e shares o f an y such bank m aycont inu e to be fo r the same amounteach as they were before the conver-sion, and the directors may

continue to be the directors of theassociat ion see^gam ^ed unt il othersare elected or appointed in accord-ance with the provisions of thela w statutes of the United S tates.When the comptroller has given tosuch bank or banking associationa certificate that the provisions ofthis Act have been complied with,such bank or banking association,and all its st ockh olders, officers, a ndemployees, shall have the samepowers and privileges, and shall besubject to the same duties, liabili-ties, and regulations, in all respects,

as shall ha ve been prescribed by t histhe Federal reserve Act ep andby thenational banking Act for associa-tions origina lly organized as n ationalbank ing a ssociations

S E C T I O N 9.

S e c . 8. That section J S e c t i o n fi ft yon e hundred an d fi ft y fou r,United States Revised Statutes, f c t a ]i s h e r e b y amended to read as fol-lows:

A n y bank in corpora ted by spe-cial law of any State or of theUnited S tates [ , j or organized underthe general laws of any State or ofthe United States , ] and having an un im paired capital sufficient to entitleit to become a national banking as-sociation under the provisions of theexisting laws may, by the vote of theshareholders owning not less than

fi ft yon e per centum o f the cap ita lstock o f such bank or bank ing associa-tion , with the approval of the Comp-troller of the Currency, be convertedinto a national banking association

,with an y nam e approved by theComptroller of the Cu rrency:


Provided, however, That saidconversion shall not be in contraven -tion of the S tate law. In such casethe articles of association a

Documents

HR 7837 1913 1218sen Bankcurrbill