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.Proposed ijaendaent Ho. 1> to S. 829* Section On Page 1, Line 8, teginning with the wo ids "to control", strike out i l l through Line 3 °n Page 2, ending with the words "control of banks". Explanation of Proposed Amendment No. 1. to S. 829. Section 2 This is the declaration of policy section. It lays the basis for the gr*nt of extraordinary powers to the Reserve Board in Section 6 (d) on Page 9. It is proposed that Section 6 (d) be modified (See proposed amendment No. 5)• While the declaration of policy is not law the Board, would naturally consider it on invitation to convert it into law by Baking its own rules an* regulations under the rule making power granted under Section 10, Page 12. Proposed Aaeadagnt Ho, k, to &» & y« Section 3 On Pfege 2, LlM * l f after the word "bfonkaB, add the followingt •or • c; hich is h U>rJk hoiciing c by virtue ol* this section** Proposed Amendment No* 3 to S. 829» Section 3 On Bage 3, Line 5> after the word "any", insert the words "person or". Proposed Amendment No. k* to S. 829 • Section 3 On Page 5 after Line 16, insert the following subsectiont *(g) 'Person1 means n individual or company*. i V \ s of Pro post! jonendaents No,3« £« 3. -iad to S. 8«9. This whole section w&« taken fro* the ^Public U t i l i t y Holding Cotapeny Act of 1935* (Title 15, Section 79b. 0, S. Code) 'ith certain omissions* The thre proposed aaeadUMrats »-ould r<«u£»e the defi -ltions in the b i l l to conform aore closely to those in the Public Uti i t y Holding Company Act, and would reach a l l bunk holding companies in the taae ^nner M the Public Uti Ity Holding Company i.ct* Proposed Amendment No. 5. to S. $29« Section 6 *(d) In determining whether to approve any ac uisition subject to paragraphs (a), (b) or (c) of this section consideration shall be given to the financial history and condition of any ac uiring bank holding compeny or subsidiary thereof End of any acquiring bank, including the adequacy of such bank's capital structure, the general character of its management fnd that of any such company, the futur© earring prospects of such a bank, the conveniBnce and needs of the community to be 3erved, including the economic and trade relations in the area affected and the right of stock—holders in a bank to realize the financial worth or their assets. The factors stated in this section shall likewise be considered by the Board, the Comptroller of the Currency, and the Federal Deposit Insurance Corporation, respectively, insofar as applicable to b^nks and/or bonk holding companies or subsidiaries as the c^.se may be, in determining whether to approve an application of uaj tank to establish or change the location of a branch or branches, and in admitting state banks to memt'er— ship in the Federal Reserve System and to the Federal Deposit Insurance Corporation. Notwithstanding any other provision of law, no bank shall acquire all or substantially all the assets of any other bank without obtaining such approval as is required in the case of acquisitions by banking subsidiaries of bank holaing under subjection (c) of this section, >nu In determining whether QT not to approve any ueh tion or sale tn* f ictorfc v bt con- sidered evoy by the Board, the Cosptvollt nd the Deposit Insurance Corpor ti..,n, &e th« ca*# nay be.* t l ?n o f Aaftflfrjpt Ho, 5 on P-wa 11 > S. r» ndaent wouXi substitute a new tstol—Xtam (d) to Section 6 designed to *at up stana o f discr*»ti n o f tb u or^ owm I i>e . A t4 or o t h e r Hg n c l i i La ctin^ t t a M i con»intent v l t h the f a c t o r s s e t forHl In th« Banking Act o f 1935» A c t i o n 101 ( g ) . The lao^ttaga »triicer. "ie io?. iti or o t h e r a g o n e i e a , in | t p p l i c ^ t i u n , <itscr«tl • t o c o n s i d e r n e t o n l y fir•..-.r.eiv.i hiatoTy, p r o s p e c t s , c b r ^ c t e r of the uQHHgocM»nt conditis.r^ nd ne«ds v»n.i»nc« of the c o m . n i t y concw n*d but i n adciltion *>risiori8 which purport t o e e t u;. i ; •v«lf: re of th« coru-vuciti#« and th« vtkB9 Itllliai^l auch *e nc^"n«d;1' o • •the • n&tlcnal policy agtviniit rtr»trai«t of tr "e* (s9a«ur«s JO vig^e so broad give tha ikmrd the ,)O^ar to enforce th* oao.hy of tha witl-trust l^va), *m6m of economic power* ^nd "ir, f.ror of th« in the field of rasr.c« o .<?• .and "the »ixe ajad extent of & bunk coKpeny 6yste»* (provi^iaaa of ev<«» grt- These clauses would put into re dth .inds of the Board powers or prmttle l l y i i f m t t r t discreti • r. •?titioa i Proposed Amendment No, 6 to S. 829. Section 6 On Page 11 after Line 23, insert a new subsection M followst *(e) Any shareholder or group of shareholders owning voting shsres of a bank affected by the terms of any plan, undertaking or agreement for purchase or sale of such shares or assets, the consummation, effectuation or completion of which, by the terms of this section, is or may te deemed to be subject to the prior approval of the Board snd/or the approval of any other officer or agency, or any bank, company or bank holding company any so zf ected, either as seller or purchaser of assets or through a saleor purchase of voting shares of • bank, shall have the right to notify the Board and/or other ogency in writing of the existence of any such plan, undertaking or agreement and make formal application for such approval. Thereupon it shall be the duty of such Board or other agency immediately upon receipt of such notice to advise the applicant or applicants concerning the details of the information re uired in support of the application to enable said Board or other agency to MTt upon the same) and it •hall be the duty of the applicant or applicants to furnish such information in such form and within such time as may be required. Any such application shall tftmmmmmflF pending after the service notice hereinabove provided, and while so pending any other jroceeding of an7 character authorized by this act effecting the subject mt-.tter of the application shall be suspended. If the Boerd or other agenc;;1 •mall disapprove such application the grounds of diaapprovel shall be stated, together with the facts which in the judgment of such Board or other tgency warrant an adv rsa finding on each ground stated und any action, finding or conclusion of the Board or other agency shall be by order and shall not be considered agency action conndLtted to agency discretion vithin the provisi.n^ o* the Adainistrctiv* Procedure Act and specifically, within Section 10 thereof. Any shareholder or shareholders, bank, company or bank holding company authorized to nake application under this section 3ha'l have the right to obtain a judiciel review under the pr<>visions of the Administrative Procedure Act of zny agency action of the Board or other agency by which he or it is adversely affected or aggrieved or suffers legal wrong* The reviewm provided in this section shall take precedence over and be in addition to any other review fo1* vhich provision is made elsewhere in this act, and the district courts of the United States, the United States District Court for the District of Columbia and the United States Courts of any territory or other place subject to the jurisdiction of the United States shall have jurisdiction to review the action of the Board or other officer or agency under this section upon a petition for review or in any applicable form of legal action (including actions for declaratory judgments or writs of prohibitory or Mandatory in— • s junction or ha)-e*s corpus). The venue of any action or proceeding to obtain a review of • determination under this section shall be j the district in vhich an affected bank is located and does business or, at the option of the complaining party or parties, the .,. United States District Court for the District of Columbia. In any such action or proceeding service may be made upon the secretary of any agency *hose action is sought to be revieved at its offices in the city of Washington, D. C , or if there be no secretary, upon the officer at his offices in the city of Washingtonf D, C, Notwithstanding any other provision of law, the court shall have exclusive jurisdiction of such review snd power to render any judgment or decree within the scope provided by Section 10 cf the Administrative Procedure Act. Findings of fact by such Board or other agency which are sustained by substantial evidence shall be conclusive when s^ch evidence is duly certified by the Board or other agency and filid ith the clerk as an exhilit in any proceeding in which review of such action is sought. Ex parte statements or declarations, sworn or unsworn, given in circaBstances in which there wt.s inadequate opportunity for confront— tion or cross examination by an applicant sh&ll not be considered as evidence. Any finding or conclusion by the Board or other agency which determines or purports to determine law, national policy, or comrainity or area welfare shall be reviewed de novo and there shall be no presumption that it is either correct or incorrect and su«h finding or conclusion sht.ll not be treated as evidence, The jud^BBit or decree of the court in any such proceeding shall be final but shall be jubject to review as provided in Sections JLc8, 239, and 2^0 of the Judicial Code,as amended. No costs shall i be assessed for or against the Board or other agency. Following ii a nev subsection (subsection (e) of Section (6) that has been drafted on the theory that subsection (d) would regain substantially as in the bill. This proposed sub- section will, in my judgment, if adopted be the most import-At section in the bill because it provides the only pn#tAMl proccedufre for protecting the parties affected by the bill ;st discrimination -nd excesses of discretionary power. The way the bill is written without t ds subsection there is pratieslly no limitation and no review. Thercostimportant transactions afte1" the adoption of this bill would be those which fall within the scope of Section 6 and all or any of them could be nullified ut the whim or CEprice of the Board or other agency, and the purported ftoffti u :on v'jich they would rely to sustain their determinations might have been gathered by, secret investigi^tions conducted in the absence oi the parties most vitally interested. Power to nullify legitimate business transactions should only be exercised in borne kind of orderly proceeding ai*} it s nould be conducted in accordance with due process and administrative action should be subject to judicial review. This bill would make mockery out of the Administr tive Procedure Act, and it would by-pas it completely with respect ot the principal powers exercised. j Incidentally, this amendment highlights the .nterest of the shareholder and the bsjik concerned. the It ia so drawn ss to right of the seller and the beuk as well as the purch ser. /H
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