Full text of Mimeograph Letters and Statements of the Board : Letter From Asst. Secretary Bethea re Ruling That Vice President with Authority to Sign Deeds, Checks, etc., Is Classified as Executive Officer Under Regulation O, Number S-242, Volume 53, Page 340

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340

BOARD OF G O V E R N O R S
of

t h e

FEDERAL RESERVE SYSTEM

8-242

Reg. 0-40

w a s h i n g t o n
ADDRESS

OFFICIAL C O R R E S P O N D E N C E
TO THE

BOARD

December 11, 1940

Dear Sir:
Some time ago the Board had occasion to consider the applicability of section 22(g) of the Federal Reserve Act, regarding loans
to executive officers, to a vice president of a national bank who had
authority to sign deeds, checks, drafts and other documents in the absence of the president. The letter which the Board wrote on the subject was not circulated to the Federal Reserve Banks at the time and,
accordingly, for your information and records we are stating below the
position which the Board took in the matter.
It appeared that the officer in question had been an inactive
vice president of the bank for many yearsj that he had never been paid
a salary as vice president, his only compensation being as a director
and a member of the finance committee of the board of directors; and
that except for his duties as a director his only official actions were
the signing of documents in the absence of the president. The board of
directors of the bank proposed to adopt a resolution giving the vice
president in question authority to sign deeds, checks, drafts, and other
documents in the absence of the president, but expressly denying him
authority to make loans or to perform any of the other duties of an
executive officer having control of matters of policy or direction of
the activities of the bank.
On the basis of the above facts, the Board advised the Federal Reserve Bank which submitted the inquiry that it concurred in the
Federal Reserve Bank1s opinion that the duties to be performed by the
officer in question require a participation "in the operating management of the bank" and, therefore, he would be an executive officer of
the bank within the meaning of the Board's Regulation 0, as amended
July 1, 1939.
very Lruiy yours,

TO THE PRESIDENTS OF ALL
FEDERAL RESERVE BANKS



L. P. Bethea,
Assistant Secretary.