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*ebrur*ry 9, 1&45 K r . C*«ie It'r. Y i n g f i e l d , Aestat^rst Oeaerfcl A t t o r i s e y I t I s suggested tfe*t t h e of Reasons" have p r e pared a U h t be revamped $a*ewk*t aa f o l l o w s i of thl* is a r e t a a p l & f o f f o u r 11 » t an?; I t h i n k th«< p r i n c i p a l a d d i t i o n a l tfeou&ht I s cont&ined I n t h * f i r s t traafre*od peragraph.5 1. 8* U s w l l l l a g n e s o f $«aag*m*nt o f Tr&as»B#riea C o r p o r a t i o n t o c o n s u l t w i t h s u p e r v i s o r y a u t h o r i t i e s e s t a b l i s h e d by Congress o r t o conform t o t h e i r s u g g e s t i o n s , even. though t h e setter*? i n v o l v e d a r e ones o f b r o a l p u b l i c p o l i c y a f f e c t l n , . the n u b i l e 1 s t e r e c t * T h i s i s l a d l e s t a d by — a. Expansion o f b o l d l y ; coKpeay I n v & r l o u s f i e l d ? o f a c t l r i t l e without consultation « i t h established supervisory a u t h o r i t i e s ; b# O r g s n l a s t l o a o f no* o a s i s aa£ a c q u i s i t i o n of control o f banks w i t h o u t auch c o n s u l t a t i o n s e. The a t t e m p t s o f t h e ranagwKent t o evade t h e r e q u i r e ments o r r e s t r i c t i o n s ©f one s u p e r v i s o r y agency by r e s o r t l a r t o c h a r t e ? s , p e r m i t * , e t c . , from a n o t h e r s u p e r v i s o r y agency. I n a b i l i t y o f #*aa$e&e&t o f Treasemerlca p ro up t o j u s t i f y f u r t h e r expansion l a e x i s t i n g c i r c u m s t a n c e s . T h i s I s i n d i c a t e d by — a. The h i s t o r y o f the group, p a r t i c u l a r l y the condit i o n o f t h e group d u r i n g and s u b e ^ u e n t t o t h e tanking h o l i d a y o f 1**81 b. The d i l a t o r y t a c t I s s o f t h e management l a c o r r e c t i n g 3uch c o n d i t i o n w i t i i e c o n t i n u i n g t o expand t h e f r o u p , t h e I n a b i l i t y o r u n w i l l i n g n e s s o f t h e r-eaagemeat t o improve t h e c o n d i t i o n o f t h e £ r e u p , t h e f a i l u r e t o oeaaeree e a r n i n g s o r e b t r i a funds t h r o u g h leeuenee o f a d d i t i o n a l s t e a k upon ehleh t o base f u r t h e r expenalon, aad t h e nee o w e l t y f o r r e s o r t i n g t o t h e Gove recent f o r c a p i t a l funds. I n a b i l i t y o f t h e eanageRant o f t h a ^ r o u p t o d e n o u s t r a t e t h « t i f f u r t h e r e x p a n s i o n we?-e p e n c i t t e d t h e T r a s s a r e r l e a C o r p o r a t i o n * o u I d be e b l e t o s u p p o r t i t s s u b s i d i a r y banks i n c h a n g i n g c o n d i t i o n s r e s u l t i n g f t o p t h e war and I t s a f t e r m a t h . T h i s i s i n d i c a t e d by — a* The p r e v i o u s h i s t o r y o f t h e h o l d i n g c o w o n y and i t s f a i l u r e t n r o u g h l t f * d i v i d e n d and p r e v i o u s e x p a n s i o n policies to R&int&ln i t s e l f i n a financial position to core t o the a i d o f i t s a f f i l i a t e d i n s t i t u t i o n s i f t h e seed a r i s e s . 4. I n a b i l i t y o f pfiaageffeat o f ?*rou? t o j u s t i f y i n c r e a s e o f d e p o s i t i n s u r a n c e e x p o s u r e t. 1 rou^b e x p a n s i o n o f o p e r a t i o n s w i t h o u t a d e q u a t e l y s t r e n g t h e n i n g p o s i t i o n o f t o l d i n . conpasy through conservation o f earnings o r otherwise. 5* C o n t i n u a t i o n o f expansion a c t i v i t i e s while o t h e r rroups ssd banks fcave been c o n t r a c t i n g t h e i r a c t i v i t i e s and 1 ? proving t h e i r condition. 6. F a i l u r e o f r a n a g s n e n t o f g r o u p t o g i v e due c o n s i d e r a t i o n t o proposed l e g i s l a t i o n w i t h r e s p e c t t o bank h o l d i n g com* p a n i c s and i t s e f f e c t o n t h e b a n k i n g s i t u a t i o n I f e n a c t e d .
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