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FEDERAL RESERVE BOARD WASHINGTON ADDRESS OFFICIAL CORRESPONDENCE T O T H E FEDERAL RESERVE BOARD X-6915 J u n e 19, 1931 SUBJECT: Action on Governors' Conference Topics. Dear S i r ; There i s a t t a c h e d h e r e t o f o r your i n f o r m a t i o n , copy of a l e t t e r to t h e S e c r e t a r y of t h e Governors' Conference, a d v i s i n g of t h e a c t i o n taken by t h e Board on c e r t a i n of t h e t o p i c s d i s c u s s e d a t t h e Conference h e l d i n Washington on A p r i l 27-29, 1931, Very t r u l y y o u r s , J . C. H o e l l , Assistant Secretary. Enclosure. TO GOVERNORS OF ALL FEDERAL RESERVE BANKS EXCEPT SAN FRANCISCO COPY X-6915-a June 19, 1931. Dear Mr. S t r a t e r : This w i l l acknowledge r e c e i p t of your l e t t e r of May 2 6 t h , e n c l o s i n g c o p i e s of t h e S e c r e t a r y ' s minutes of t h e Governors' Conference h e l d i n Washington on A p r i l 2 7 t h , 28th and 2 9 t h . The Federal Reserve Board has given c o n s i d e r a t i o n to the v a r i o u s t o p i c s d i s c u s s e d by t h e Conference and a c t i o n has been t a k e n a s follows: Topic I I - D - Change i n weekly Federal r e s e r v e bank statement* The Board has approved t h e suggestion t h a t t h e s p e c i a l oneday c e r t i f i c a t e s of i n d e b t e d n e s s i s s u e d by t h e Treasury Department to Federal r e s e r v e banks to cover Treasury o v e r d r a f t s x>n t a x p a y ment d a t e s , be shown s e p a r a t e l y in t h e body of t h e weekly F e d e r a l r e s e r v e bank s t a t e m e n t a g a i n s t t h e c a p t i o n , " S p e c i a l T r e a s u r y Certificates." Topic I I - E - 1 - Payment of a sum equal to one or more months* s a l a r y to t h e widow, dependents, or e s t a t e of deceased o f f i c e r s o r employees. In c o n n e c t i o n w i t h t h e f i r s t recommendation of t h e c o n f e r e n c e on t h i s t o p i c , t h e F e d e r a l Reserve Board h a s r u l e d t h a t i n t h e event of t h e death of an o f f i c e r or employee of a Federal r e s e r v e bank, t h e s a l a r y of such o f f i c e r o r employee should be p a i d o n l y up to t h e n e x t succeeding pay day. The Board h a s n o t y e t a c t e d , however, on t h e m a t t e r s of an i n c r e a s e i n group i n s u r a n c e f o r o f f i c e r s and employees a t F e d e r a l r e s e r v e banks, and t h e e s t a b l i s h m e n t of a n n u i t y or p e n s i o n p l a n s by t h e i n d i v i d u a l banks. Topic I I - E - 2 - Payment of s a l a r y i n f u l l or in p a r t to o f f i c e r s o r employees i n c a p a c i t a t e d on account of s i c k n e s s o r o t h e r w i s e . The Board has n o t e d w i t h approval t h e a c t i o n of t h e Conference i n v o t i n g t h a t where t h e absence of o f f i c e r s or employees on account of s i c k n e s s o r o t h e r i n c a p a c i t a t i o n exceeds t h e r e g u l a r v a c a t i o n p e r i o d by t h i r t y days, payment of s a l a r y d u r i n g f u r t h e r l e a v e of absence should be s u b j e c t to approval by t h e Board of D i r e c t o r s and r e p o r t e d monthly to t h e F e d e r a l Reserve Board i n accordance w i t h t h e B o a r d ' s l e t t e r of June 1 4 t h , 1928, (X-6069). Supplementary Topic B. - Suggested p o l i c y i n a c t i n g on a p p l i c a t i o n s of s t a t e t --inks and t r u s t - compani38 f o r membership . The Board has adopted t h e propcsud p o l i c y , in c o n n e c t i o n w i t h i t s c o n s i d e r a t i o n of a p p l i c a t i o n s of s t a t e banks and t r u s t companies f o r membership i n t h e Federal Reserve System, t h a t a t t h e time of admission 714 3t-6915ra * 2 " t o membership t h e a p p l i c a n t "bank s h a l l be f r e e from a l l known l o s s e s and d e p r e c i a t i o n so t h a t on t h e d a t e i t s membership becomes e f f e c t i v e i t s s t a t e ment w i l l r e f l e c t a s n e a r l y a s p o s s i b l e t h e v a l u e of i t s a s s e t s . In t h i s c o n n e c t i o n , a l e t t e r i s g o i n g f o r w a r d today to a l l F e d e r a l Reserve Agents, r e q u e s t i n g t h a t t h e y b r i n g t h i s a c t i o n of t h e Board to t h e a t t e n t i o n of t h e i r committees of d i r e c t o r s which p a s s on a p p l i c a t i o n s , i n o r d e r t h a t t h e y may be governed a c c o r d i n g l y i n making t h e i r recommendations t o t h e F e d e r a l R e s e r v e Board. Topic I-D - D e s i r a b i l i t y of f l e x i b i l i t y of i n t e r e s t r a t e s p a i d on d e p o s i t s and of bank dividends* The Board h a s n o t e d w i t h approval t h e a c t i o n and e x p r e s s i o n s of o p i n i o n of t h e Conference i n r e g a r d to t h i s t o p i c . Topic I - F - P o s s i b l e d e s i r a b i l i t y of amending t h e F e d e r a l Reserve Act so a s to p e r m i t a F e d e r a l r e s e r v e bank i n emergencies to make a d vances to member banks on t h e s e c u r i t y of a s s e t s o t h e r t h a n p r e s e n t l y eligible paper. Action on t h e r e s o l u t i o n adopted by t h e Conference on t h i s t o p i c h a s been d e f e r r e d by t h e Board f o r t h e time b e i n g . Topic I I - F - A d v e r t i s i n g F e d e r a l r e s e r v e membership. The Board h a s n o t e d m t h approval t h e o p i n i o n of t h e Governors t h a t F e d e r a l r e s e r v e banks c o u l d n o t w i t h p r o p r i e t y g i v e a p p r o v a l o r s u p p o r t to any agency o r o r g a n i z a t i o n s o l i c i t i n g s u b s c r i p t i o n s from banks and o t h e r s f o r t h e p u r p o s e of e x p l a i n i n g o r a d v e r t i s i n g t h e b e n e f i t s d e r i v e d from membership i n t h e F e d e r a l Reserve System. No a c t i o n i s r e q u i r e d by t h e Board on t h e o t h e r t o p i c s d i s c u s s e d a t t h e Conference o r on t h e v a r i o u s r e p o r t s s u b m i t t e d by i t s committees. A copy of t h i s l e t t e r i s b e i n g f o r w a r d e d to t h e Governor of each F e d e r a l r e s e r v e bank f o r h i s i n f o r m a t i o n . Vory t r u l y y o u r s , J . C. No e l 11 Assistant Secretary. Mr. H. F. S t r a t e r , S e c r e t a r y , Governors' C o n f e r e n c e , F e d e r a l Reserve Bank, Cleveland, Ohio.
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