View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

COPY

TREASURY DEPARTMENT
COMPTROLLER OF THE CURRENCY
WASH DIG TON

My dear k r .

Chairman:

This w i l l acknowledge r e c e i p t o f y o u r l e t t e r of December 14, 193S,
w h i c h was w r i t t e n p u r s u a n t t o our c o n v e r s a t i o n of t h a t date i n r e g a r d t o
t h e c u r r e n t c o n d i t i o n of t h e Bank of America N a t i o n a l T r u s t and Savings
A s s o c i a t i o n o f San F r a n c i s c o , C a l i f o r n i a , and t h e p r e s e n t s t a t u s o f the
s u p e r v i s o r y problems w h i c h i t
Your l e t t e r
negotiations

presents.

seems t o have been w r i t t e n under the i m p r e s s i o n t h a t

s e e k i n g an agreement w i t h r e s p e c t t o t h e a d o p t i o n o f

corrective

measures have been under way between the Bank and t h i s o f f i c e and t h a t a
p r o c e e d i n g a g a i n s t t h e o f f i c e r s and d i r e c t o r s o f the Bank under S e c t i o n 30
of the Banking A c t of 1933 i s no l o n g e r
I -want t o c o r r e c t t h i s i m p r e s s i o n .

contemplated.
The s i t u a t i o n c o n c e r n i n g t h e

b a n k ' s major problems remains much t h e same as i t was a y e a r ago l a s t
when Governor -tansan a t t e n d e d t h e m e e t i n g s i n S e c r e t a r y I . o r g e n t h a u ' s

fall
office.

The d i f f e r e n c e s between t h i s o f f i c e and t h e Bank remain u n s o l v e d d e s p i t e
my r e p e a t e d w a r n i n g s t h a t d e f i n i t e c o r r e c t i v e steps must be t a k e n by the
Bank.

Yfnatever n e g o t i a t i o n s have been under way have n o t been f o r t h e

pose of seeking an agreement b u t f o r t h e purpose o f seeing t o i t t h a t

purthe

Bank c o m p l i e s w i t h t h e r e c < m i e n d a t i o n s and s u g g e s t i o n s w h i c h I have made
based on r e p o r t s o f e x a m i n a t i o n o f t h e Bank.

To d a t e the Bank has done

l i t t l e more t h a n e q u i v o c a t e and lias t a k e n no d e f i n i t e steps t o comply w i t h




t h e most i m p o r t a n t o r t n e s e recommendations and s u g g e s t i o n s .
does i t

Neither

a p p e a r t h a t t h e Bank i s p r e s e n t l y d i s p o s e d t o t a k e any such s t e p s .
The c o n t i n u a n c e o f t h i s s i t u a t i o n cannot be t o l e r a t e d .

I

Indeed,

have t o l d t h e Chairman o f t h e Board o f t h e Bank t h a t t h e Bank must

come f o r w a r d by December 3 1 , 1^39 w i t h a d e f i n i t e p r o g r a m , a p p r o v e d by
i t s Board o f D i r e c t o r s , w h i c h w i l l meet t o my s a t i s f a c t i o n my recommendations
and s u g g e s t i o n s .

If

such a program i s n o t f o r t h c o m i n g , I w i l l be c o m p e l l e d

t o t a k e such measures a g a i n s t t h e B a n k ' s management as t h e l a w a u t h o r i z e s
and r e q u i r e s t o p r o t e c t t h e i n t e r e s t s o f t h e s t o c k h o l d e r s and d e p o s i t o r s .
A p r o c e e d i n g u n d e r S e c t i o n 30 i s one such measure and t h e

possibility

t h a t a p r o c e e d i n g u n d e r t h a t S e c t i o n may y e t be n e c e s s a r y i s by no means
foreclosed.
W i t h t h i s i n m i n d , i f y o u s t i l l w i s h t o be a d v i s e d w i t h
t o t h e Bank and w i l l d e s i g n a t e
may communicate, I
action

some member o f y o u r Board w i t h whom I

s h a l l be v e r y g l a d t o keep h i m i n f o r m e d as t o any

taken.
Very s i n c e r e l y
v

(Signed)

yours,

P r e n t i c e Delano
Comptroller of the

Hon. M a r r i n e r S. E c c l e s ,
Chairman, Board o f Governors
F e d e r a l R e s e r v e System
W a s h i n g t o n , D. C.




respect

Currency