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BOARD DF 8-l~ See. lS ,F.R.A.-' [IIZJYI:ANDRS CF~H~. 3'n FEDERAL' RESERVE SYSTEM .. ''' -- - WASHINaTCIN A~DRJtllll. Novanber 2S,. Dear 1~. Of'p;t91AL CIDJIItl:llf'DI!IDitHCI: 'tb 1'Hll: GAllO . atr; Board X. rtlaponse to. an iJJtluil"y rr•. a f$der~4 ~~~ 'bank, the or Qove.rnorerreoent.tt advi.- 'tJhe Mf.lk· •• P6Um: ' ' -' ~ ~1 ttReference is made to JOUtr letter ot(~t 24, 1938, requesting a4rice ... to tfbether, in View ot tllo letter of S.,tember .30 1 1956~ x..,9709, yo,_ bfmk ialloUJA maintain .two accounts ;re~a-Ung .the 4ep<Htit.ot Uninvested.truat ttuads by tne ~t Co~, _ __ ~""'!--:.--' a ••bot !wititutioo wld.Ch tnmttacta no coJIIIler"" cis.l bankinl bwdnesa" ·· lt is Ul1~tooa thelt tbe two accountS operaed on your booka.ro~aent a.ecreption ot unS..vested e<>urt and p;rtftte tl"Ut f-.da 1 ae required .bJ the laws or . . .. ' ~ it 1• ~pectetl tbat '*e ac-: counts will not h ctf • tellpol'&J'1' Jlllliture. .. . · "In view ot t.be l'eP1'9Setlta'tl~a.• me.de l"~ the aoooun WI of tbe . .. . . h-uet dott~ •. the situa tJ,OD ot a number or aember ~~ wbioh t1N .f1ibject to a COJM11 tion or membership requirin& the · . pledp ot··· securities to CoYer t&-ust tunda deposited in their own c~retal l;)ank!ns de~ts but are not permitted •bJ· Statf; law to ...U · auob a plecJaei a.nd. the poseible 'tellp0%"&17 Mel! <>.f', other mem\)er beaks ope~ting ~t 4ep(ll"t11Mmte Wbicb was t.be . baaia for the 8oaj:l•s letter ot.Se.pteltber ~. 1916, X-9709, the BoarjrwUl offer no. o'bJe~tiol1 to the rece~Pt ot depoJits of ug...'nvested tru.s~ hnda in Jpeclial acoounte eo...ra•• by the l'edert.l.l Bjlel'Ye banka from; . ... · (l) ar17 ...beJ ~ tor a ,te!llpO~ per~od when, in the j~t or th,, Federal• l\4t~l"'l'& ·~, circumstan9e ~der ~11 . .ervtce to 1;he :pUticula.r . )llrabk. dea'-ra.ble,. , .. (2) any State •tll:le~•bank 8\lbJf>Ct to the .cond1tion ot . . . · rslq.. p....·.·.that. true ..· oepar ·.·tQU·d&l· · ·.. t ehall s. .i.. ted·. the.Jile$be bank 1D·. lta bankin& ...... t.. ·.de·······..P Q . b.1 be securae by pledge or eol1ate.ralvdtb the trust S-150 Sec. 13 li'.R.A.-4 -2- department and located in &. State whose laws do not permit the pledge of collateral tor the purpose, and (3) any member trust coapa.n;y which transacts no savines or coiiiDercial banking blsinoas. "As indicated in the Board's letter or SeptemhEfr 30, 1936, deposits or run<1s received by a member bank in a fiduciary capaci -cy &nd · deposited in a Federal Reserve bank in a special account •Y not be counted as a part of the member bank's reserve balnnce with the Federal Reserve bank. "While the Board feels that tbe matter of requiring an agreoment, as suggested in its letter ot September 30, 1936, as well as the question of ~$tr1Ctions upon the source and disposition of truet ~da t8ce1ved on deposit under the authority contained in 1:411s letter, are for the dete~t.t.on or each Fed~l ReaervEt bank in consideration ot the laws and court decisions in the States·· incl~ed ill it.~.· district, it is asaUIIled that, in 9.l\Y caee in Wllich ..Un•••ted trust f\Ulda are.· received by a Federal Reserve ba.nlf, 1 t will take such steps in consultation with its counsel as may be deemed necessary to elillinate or Jld.n,ia1ze ·.fU\Y possibility or litigation or loss to the Federal Reserve bank." Very truly yours, Chester Morrill, Secretary. TO THE PRESIDENTS OF ALL FEDERAL RESERVE BANKS 378 ,
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