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bection
(U.3.C. Title

of the Federal Reserve Ax*t as amended
, ^ec#

) ie hereby amended by the

addition thereto of the following paragraph;
Exclusive of investment in bonds or other interest
bearing obligations of the United States Government (and
loans wholly and adequately secured by such bonds), no
member bank shall sake loans or investments in an amount
in excess of ten times its unimpaired capital and surplus;
and the Federal Reserve Board is hereby empowered to and
may from time to tiiae and at any time, by regulation prescribe the number of times, less than ten of their unimpaired capital and surplus with which .Member Banks in any
one or more Federal Reserve Districts shall be allowed to
make such loans or investments other than those above excluded; provided, however, that the Federal Heserve Board
shall never by such regulation reduce such ratio below that
of five times the unimpaired capital and surplus.
The term "bonds or other interest bearing obligations
of the United states Government" as hereinabove used shall
refer to such bonds or obligations as the Comptroller of
the Currency may from time to time by regulation prescribe;
and the tern "loane" as hereinabove used shall not refer to
deposits by Member Banka in any Federal Reserve Bank or in
any other Member Banks approved by the Comptroller of the
Currency.
Bl : Capital k Surplus $3,000,000




Depoait3 ^50,000,000

Allowable loans and investments, other than those above
excluded would vary, depending on Fed. Reserve Regulations
Between ^15,000,000 and $30,000,000
!•
2.

This would provide market for Government Bond© even
when thera is a demand for money.
fould allow for expansion or contraction of credit
by Federal Reserve Board,