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COPY. X-7484 TELEGRAM FEDERAL RESERVE BOARD Washington June 27, 1933 Case Austin Williams Hoxton Hewton Stevens New York Philadelphia Cleveland Richmond Atlanta Chicago Wood Peyton McClure Walsh Hewton St. Louis Minneapolis Kansas' City Dallas San Francisco TRAITS 1833 In reply to an inquiry from a Federal reserve bank the Board has advised as follows: "Eighth paragraph of Section 13 of Federal Reserve Act, as amended by section 9 of Banking Act of 1933, does not require a member bank which has obtained advances from Federal Reserve Bank pursuant thereto to refrain from making further loans secured by collateral or to doalers in securities until an official warning is given by the Federal reserve bank of the district or by the Federal Reserve Board as provided in the statute; and an increase by a member bank in the amount of such collateral loans or loans to securities dealers during the life or continuance of an advance under the provision of said paragraph does not subject the bank to the penalties prescribed therein unless occurring after the issuance of such an official warning. In connection with this subject, please see also Section 11 (m) of the Federal Reserve Act as amended by Section 7 of Banking Act of 1933." MORRILL
@FedFRASER