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FEDERAL RESERVE BOARD X-4687 WASHINGTON ADDRESS OFFICIAL CORRESPONDENCE TO THE FEDERAL RESERVE BOARD October 12, 1926. SUBJECT: Topic to be Placed on Progr5e of Conference of Federal Reserve Agents. Dear Sir: The Federal Reserve Board has voted to place upon the prograc for the next conference of Federal Reserve Agents for their consideration and advice the question as to the advisability of the Board adopting for all national ba~~s a oiniouc capital requirecent.and icposing other requireoents in connection with its granting authority to such bariks to exercise trust powers. For your infor.oation in this connection, there is enclosed herewith a copy of a oeooranduc b,y the Eoard 1s Counsel relative to the.leial right of the Board to place a oin:iouo liriit on capital of national banks to which it will grant trust powers. Very truly yours, Walter L. Eddy. Secretary. Enclosure. TO .ALL FEllBlRAJ, RESERTIJ AG·ENTS • X-4687-a May Tho l'aderel Reserve Board Ur. Wyatt - General Counsel .. 21, 1926. Right of Board to place minimum limit on capital of national banks to which it will grant trust powers. The opinion of this office has been requested on the question whether the Board can legally place a minimum limit upon the capital of a national bank to which it will grant trust powers. The last paragraph of Section ll(k) of the Federal Reserve Act reads as follows: · "In passing upon applications for permission to exercise the powers enumerated in this sub-section, the Federal Reserve Board ma..y take into consideration the amount of ca-pital and surt?lus of the applying bank, whether or not such capital and surplus is sufficient . under the circumstances of tho case, the needs of the comounity to be served, and any other facts and circucstances that seem to it proper, and IIIB)Y grant or refuse the application accordingly: Provided, That no permit shall be issued to e:n.y national banking association having a capital and surplus less than the capital. and surplus required by State law of State banks, trust companies, and corporations exercising such powers." In view of this provision there can be no doubt that the Federal Reserve Board may legally prescribe a minimuc capital for national bariks applying for trust powers and tJay decline to grant trust :powers to a.ny national bank which has not a capital equal to or in excess cf the oinir:rom licit so prescribed by the Board. Of course, the minit::tuo capital prescribed by the Federal Reserve Board tnlst not be less than the capital required by State law of State banks, trust companies, and other corporations exercising trust powers. Respectfully, Walter Wyatt, General Counsel. WW/NS
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