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FEDERAL RESERVE BOARD WASHINGTON ADDRESS OFFICIAL CORRESPONDENCE TO THE FEDERAL RESERVE BOARD X-6478 J a n u a r y 15, 1930. Dear S i r ; There i s a t t a c h e d h e r e t o copy of a l e t t e r "being a d d r e s s e d to one of the F e d e r a l r e s e r v e a g e n t s , r u l i n g t h a t a member "bank i s not e n t i t l e d to s u b s c r i b e f o r a d d i t i o n a l F e d e r a l r e s e r v e "bank s t o c k on a c c o u n t of an i n c r e a s e i n i t s c a p i t a l , u n l e s s t h e amount of F e d e r a l r e s e r v e "bank s t o c k which i t h o l d s a t t h e time i s l e s s t h a n s i x p e r c e n t of i t s combined c a p i t a l and s u r p l u s . Very t r u l y y o u r s , 3 . M. McClelland, Assistant Secretary. TO ALL FEDERAL RESERVE AGENTS EXCEPT BOSTON Enclosure. X-6478-a COPY J a n u a r y 15, 1930. Dear S i r ; Receipt i s acknowledged of your l e t t e r of December 23rd, w i t h r e f e r e n c e to t h e amount of F e d e r a l r e s e r v e "bank s t o c k t o which the may he e n t i t l e d to s u b s c r i b e on account of an i n c r e a s e of i t s c a p i t a l . I t a p p e a r s t h a t , a s a r e s u l t of c e r t a i n c o n s o l i d a t i o n s by the w i t h o t h e r banks, t h i s bank h o l d s F e d e r a l r e s e r v e bank s t o c k i s s u e d upon the b a s i s of s u r p l u s a c c o u n t s which have s i n c e been reduced w i t h out t h e s u r r e n d e r of a c o r r e s p o n d i n g amount of F e d e r a l r e s e r v e hank s t o c k . The c a p i t a l of the h a s now been i n c r e a s e d and t h i s bank d e s i r e s t o s u b s c r i b e f o r a d d i t i o n a l F e d e r a l r e s e r v e bank s t o c k on account of such i n c r e a s e w i t h o u t any r e d u c t i o n on account of t h e r e d u c t i o n s of s u r p l u s which have t a k e n p l a c e . I t f u r t h e r a p p e a r s t h a t the amount of Fede r a l r e s e r v e bank s t o c k now h e l d by t h i s "bank i s a t l e a s t equal to 6$ of i t s p r e s e n t c a p i t a l and s u r p l u s . You i n q u i r e whether t h e i s e n t i t l e d to s u b s c r i b e f o r a d d i t i o n a l F e d e r a l r e s e r v e bank s t o c k on account of t h e i n c r e a s e i n i t s c a p i t a l w i t h o u t t a k i n g i n t o account the r e d u c t i o n s which have been made.in i t s s u r p l u s . You a r e a d v i s e d t h a t , under t h e s e c i r c u m s t a n c e s , the i s not e n t i t l e d to s u b s c r i b e f o r any a d d i t i o n a l F e d e r a l r e s e r v e bank s t o c k on account of t h e i n c r e a s e i n i t s c a p i t a l . I n o t h e r words, a member bank i s not e n t i t l e d to s u b s c r i b e f o r a d d i t i o n a l F e d e r a l r e s e r v e bank s t o c k on account of an i n c r e a s e i n i t s c a p i t a l u n l e s s the amount of F e d e r a l r e s e r v e bank s t o c k which i t h o l d s a t the time i s l e s s t h a n 6$ of i t s combined c a p i t a l a n d s u r p l u s . lEhis p r i n c i p l e should be a p p l i e d t o any s i m i l a r c a s e s which come t o your a t t e n t i o n . By Order of t h e F e d e r a l Reserve Board. Yours very t r u l y , E. M. McClelland, Assistant Secretary.
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