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Ft>rm-F. R. 5 1 1

Gov.Eccles
TO
FROM

T

REMARKS:

Herewith a draft of 8
for-the-record letter on holding
company legislation. .Vingfield, Cs gle,
Carpenter have 5.11 been consulted, but
this draft is a result of sifting their
suggesxtions, and •*• am sending it on to
you, as x understand you wan tea to see
it, but without taking the time to
get them to initial i t — i f they approve
as Jl imagine they would. >f

EL

CHAIRMAN'S OFFICE



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A somewhat similar bill was introduced in the
Senate in 1938 which, in the opinion of the Board, did
not offer a satisfactory solution of the matter, and
the Board so advised Senator Glass. Both of these
bills were drafted without consultation with the Board
and the contents thereof were not known to us until we
received copies of the bills. We feel that the new
bill is not a practical solution of the problem, that
it is punitive in that it is directed against a particular holding company as indicated by the statement which
Senator G-lass made when the bill was introduced, and
that it would be unfair to every holding company which
was properly organized under the laws existing at the
time of its organization and is now rendering service
to the public. The bill would confer upon the Federal
Deposit Insurance Corporation supervisory authority
with respect to bank holding companies, which the
Federal Reserve System has exercised ever since the
Banking Act of 1933» thereby increasing the overlapping
authority of Federal bank supervisory agencies. Furthermore, the bill would provide for further duplication of
supervision of banks which are not members of holding
company groups as well as banks which are in such groups.

It would confer on the FDIC supervisory authority with respect to
bank holding companies which the F R System has exercised ever since
the Banking Act of




The bill would provide for additional dupliaation of supervision of
banks which are not members of groups as well as of groups of banks.