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FEDERAL RESERVE BOARD WASHINGTON 3dress official correspondence t o t h e federal reserve board X-8015 September 20, 1934 Dear S i r : There i s inclosed, f o r your information a copy of a telegram addressed to Mr. Logan, Deputy Governor and General Counsel of t h e Federal Reserve Bank of Hew York under d a t e of September 10, 1934, with r e g a r d to the question whether a concern, a s u b s t a n t i a l p a r t of the b u s i n e s s of which c o n s i s t s of providing funds f o r business e n t e r p r i s e s through t h e u n d e r w r i t i n g , s a l e and d i s t r i b u t i o n of s e c u r i t i e s , may be considered a f i n a n c i n g i n s t i t u t i o n within the meaning of s e c t i o n 13b of the Federal Reserve Act, as amended. Very t r u l y yours, HQ ^ Chester M o r r i l l , Secretary. Inclosure. TO ALL FEDERAL RESERVE AGENTS EXCEPT NEW YORK. X-8015-a (Copy) LOGAN EEW YORK Your wire September 6 p r e s e n t i n g question whether Lehman Brothers investment "bankers i n Hew York may toe considered a f i n a n c i n g i n s t i t u t i o n w i t h i n the meaning of Section 13b of Federal Reserve Act. I t i s understood t h a t a s u b s t a n t i a l p a r t of the b u s i n e s s of Lehman Brothers c o n s i s t s of providing funds f o r business e n t e r p r i s e s through t h e u n d e r w r i t i n g , s a l e and d i s t r i b u t i o n of s e c u r i t i e s . I t i s also understood t h a t under t h e t r a n s a c t i o n which i s now proposed Lehman Brothers w i l l make a loan or advance to an e s t a b l i s h e d i n d u s t r i a l or commercial b u s i n e s s to provide i t w i t h working c a p i t a l and t h a t such loan or advance w i l l be evidenced by the note of such b u s i n e s s . It i s Board's view t h a t i n circumstances s t a t e d and upon condition t h a t t r a n s a c t i o n w i l l comply i n a l l other r e s p e c t s w i t h a p p l i c a b l e r e q u i r e ments of law and r e g u l a t i o n Federal Reserve Bank may l a w f u l l y discount or purchase from f i r m of Lehman Brothers such o b l i g a t i o n of e s t a b l i s h e d i n d u s t r i a l or commercial business pursuant to s e c t i o n 13b. (Signed) Chester M o r r i l l MORRILL
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