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364 FEDERAL RESERVE BOARD WASHINGTON X-9031 address official correspondence t o the federal reserve board November 26, 1934. Dear S i r : The F e d e r a l Reserve Board has been a d v i s e d t h a t a l e t t e r , s i m i l a r t o t h e one i n c l o s e d , has been forwarded by t h e o f f i c e of t h e Compt r o l l e r of t h e Currency t o a l l banks which, a c c o r d i n g t o t h e r e c o r d s of t h e C o m p t r o l l e r ' s o f f i c e , have two banking i n s t i t u t i o n s doing b u s i ness w i t h i n t h e same room. I n a d v i s i n g t h e Board t h a t such l e t t e r s have been s e n t t o t h e banks concerned, t h e C o m p t r o l l e r ' s o f f i c e has suggested t h a t t h e F e d e r a l Reserve Board and t h e F e d e r a l r e s e r v e banks lend t h e i r moral s u p p o r t i n c o r r e c t i n g t h e p r a c t i c e r e f e r r e d t o . The p r i n c i p l e s expressed i n t h e l e t t e r of t h e Deputy C o m p t r o l l e r , dated October 27, 1934, a r e i n accord w i t h t h e p o l i c y which has been followed by t h e Board f o r some time i n Connection w i t h a p p l i c a t i o n s f o r membership of banks whose banking q u a r t e r s have been s h a r e d by b u i l d i n g and loan a s s o c i a t i o n s and o t h e r f i n a n c i a l o r g a n i z a t i o n s . Replies to t h e B o a r d ' s l e t t e r d a t e d August 15, 1934, X-7982, a d d r e s s e d t o a l l Fede r a l r e s e r v e a g e n t s , r e f l e c t g e n e r a l agreement w i t h t h e p r i n c i p l e t h a t o r g a n i z a t i o n s whose a c t i v i t i e s might embarrass member banks or o t h e r banks which a r e i n s u r e d by t h e F e d e r a l Deposit I n s u r a n c e C o r p o r a t i o n , or which might r e n d e r t h e s u p e r v i s i o n of such banks more d i f f i c u l t , -2- X-9031 should be excluded f r o m t h e banking q u a r t e r s of such b a n k s , or f r o m quarters easily accessible therefrom. I t i s s u g g e s t e d , t h e r e f o r e , t h a t i n s i t u a t i o n s of t h i s n a t u r e you give due c o n s i d e r a t i o n t o t h e p r i n c i p l e s and p o l i c i e s which have been e x p r e s s e d . Very t r u l y y o u r s , Chester M o r r i l l , Secretary. Inclosure. TO ALL FEDERAL RESERVE AGENTS COPY X-9031-a October 27, 1934. Board of Directors Bank Gentlemen! Many years ago i t was made c l e a r t o t h i s o f f i c e t h a t there are a great many objections t o a National bank occupying the same or adjoining room with some other bank or f i n a n c i a l i n s t i t u t i o n . These objections have become i n c r e a s i n g l y aggravated, p a r t i c u l a r l y during the past few yearA. The objectionable f e a tures t o such c l o s e i d e n t i f i c a t i o n between two banking i n s t i t u t i o n s have become so pronounced t h a t some States have passed laws prohibiting State banks from occupying the same building with another bank. I t has come t o my a t t e n t i o n that your bank and a comparatively few other National banks i n the country are occupying the same or adjoining room with another bank or f i n a n c i a l i n s t i t u t i o n i n which j o i n t l y occupied rooms are found signs and other material i n d i c a t i n g Federal Deposit Insurance as administered by the Federal Deposit Insurance Corporation, Washington, D. C. To the ordinary depositor reading the s i g n s , the assumption i s t h a t the other bank or f i n a n c i a l i n s t i t u t i o n , as w e l l as your bank, have deposits insured by the Federal Deposit Insurance Corporation. In view of the foregoing, m i l you please advise me what arrangements you can make looking towards a discontinuance of the operation of your bank i n the same or adjoining room with the other bank or f i n a n c i a l i n s t i t u t i o n which i s now doing b u s i ness i n the same or adjoining room. Very t r u l y yours, Deputy Comptroller. TM-l/RMH ^ 8 6
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