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4· .1.l.l
i,;o nuttee on .tm=..r.c11 Liroup
Banki g
Branch banks
•
(Jun - Dec 193~)
{;
ain
•
•
END
SHEET
KIND OF MATERIAL OR HUMBER
4,d.11
MAME OR SUBJECT
Committee on Branch Group & Chain Banking
DATES (Inclusive)
Jun - Dec 1932
PART NUMBER
9
e~---·• ,
f .r. ~g
December 29, 1932~ r. ,lier __ ••••••• •••
TO THE BOARD:
------· ---
M,\..,i#
✓
This memorandum contai ns a summary of info,... JJj'Pilllk!f'~o
the minute s and files of the Bo rd re
Branch , Group
nd Chain .Jankin g.
ta ne tin
of the
Octob er 28, 1929, at which
essrs.
·11er, J
given to
ederal ~es rve
o
d held on
ere presen t Governor Youn
nd
s, Cunninghruu nd Pole, consid eratio n was
report of the
posed letter to the
in whi
turn to S cretary'
ee on
xecuti ve Committee submi ttin
ecreta ry of the
the follow in
topic
edera l
pro-
dvisor y Counc il
s sugges ted for discus sion at
the :rooeting of the Counc il to be held on November 19:
"Devel opmen ts in branch , chain and group banking, ith p rticul ar refere nce to the effect s
of bank stock owner ship by invest ment trusts
and holdi
cor_por tions" .
~
e letter referr ed to, copy of which is attach ed,
s approv ed
by the Bo rd.
ta meetin g of the Feder al R serve Bo rd hold on
December 12, 1929,
L~ssr s.
t which
1 tt, Hamli n,? iller, James
i cussed the action of the
in votin
ere presen t Governor Young and
eder 1 Res rve
to concur in the recormnen
Counc il that the
ede
1 Reserv e Bo
study the merits of the branch bankin
this and other count ries, the
nd Cunningham, there
ents' Confer ence
tion or the Feder 1
I
a
oint
as
dvisor y
commi ttee to
syst m s pr cticed in
roup or chain bankin
system
develo ped in this countr y and else her, the unit b nkin
s
system
~
v
••
- 2 -
of thi
and othe r coun trie
nd the effe ct of
OYTll
rship of bank
stock s by inve stme nt trus ts and hold ing corp or tion
s, in orde r
that the Bo rd y be in poss e sion of accu r te
nd utho ritat iv
in orma tion on the ubj ct.
Duri
the disc ussio n, l.ll'. Ja.IOOs moved th t the Board
appro ve the ppointrnent of a committee a sugg ested
by the Fe eral dvis ory ounc il and appro ved by the Fede r
1 Res rve gent s,
to it:
'To stud y the meri ts of the bran ch bank in syste
as pr ctice d in this and othe r coun tries , the m
grou p or chai n bank in syste m as deve loped in
this coun try nd else here , the unit bank ing system of thi and othe r coun tries nd the effe ct
owne rship ot bank stock s by inve stme nt trus ts ot
hold ing corp or tion s, in orde r that the Board mayd
be in poss essio n of accu rate and auth orita tive
inform ation on the subj ect."
a
id committee to be composed of' one
sele cted by the Governors
of the
eder l rese rve bank s, one by the Fede r l rese rve
agen ts,
one by the eder al dvis ory Coun cil nd one by
the eder al Rese rve
Board, toge ther 1th the Governor of the Board
sex offic io member,
and to be empowered to employ, with the appr oval
and at the expense
of the Bo rd, such expe rt serv ices a may b nece
s ry.
fter
pre ent
s
comm ittee,
r cess the
Bo
ttend ed the mornin
a
reco
•ede ral Rese rve
nded by the
d recon vene d with the same members
sess ion and the
eder al
i
dvis ory Coun cil and the
gent s w s furth er discu ssed ,
a subs titut e for the moti on made by ..r. J
ppoi ntme nt of a
Dr. I ille r subm itted
a at the morning meet -
which w s fina lly am.mded to re d a follo ws:
- 3 -
'Th tin order to expedite the assemblin of data
on branch, group and chain banking that is being
carried on in the Board's Division of Bank Operations, a cormn.ittee of five be appointed by the
oard, as recommended by the Federal dvisory
Council and the Conference of ederal Reserve
ents, to assemble and di st in ormation on
branch b n.~ing s practiced in the United States,
group and chain banking systems as developed in
the United States and else here, the unit b nking
system of this and other countries and the effect
of ownership of bank stocks by investment trusts
and holding corporations, in order that the Board
may be in possession of accur te and authoritative
information on the subject.n
t the conclusion of the discussion, Dr. ,:iller's substitute motion
as put by the Chair and carried,
t
hich
meeting of the
rr.
Cwmingham not voting.
oard on February 26, 1930,
t
re present Governor Young and ~essrs . Platt , Hamlin,
·ner, James, and Cunningham, Governor Youn
stated that he met
that morning with the committee recently appointed to make a study
of the subject of member bank reserves and suggested to the committee that the Board might find it desirable to appoint the members of the committee on reserves as a committee to study the
development of chain, group and branch banking in the United
States.
He stated that, inasmuch as tho committee would have to
give considerable thought to this subject, in connection with its
study on re serves, the members would be
illing to serve on both
committees should the Board desire to take such action.
fter
discussion, upon motion, I essrs. Goldenweiser and Smead of the
Boa d's staff, and
essrs. Rounds,
ing the Federal reserve banks,
leming and Clerk, represent-
ere appointed as a committee to
- 4 -
assemble and di est informati on on br nch banking as pr cticed in
the United
tates, group and chain banking systemsas developed in
the United St tes and else here, the unit banking system of the
country, and the effect of ownership of bank stocks by investmen t
trusts and holding corporati ons.
On Febru ry 27, 1930, Governor Young addr ssed to all
I
Governors and Federal reserve agents a letter (X-6520), of hich
a copy is attached, advi ing them that the
bad appointed the members of the
eserve Committee, consistin g of
essrs. Golden eisor, Snead, Rounds,
members of the Committee,
Council and the
agents, to
ederal Reserve Board
laming and Clerk, also
s reconnnended by the Fede
11 Conferenc es of Governors and
ssemble
1
s
dvisory
eder 1 reserve
nd digest informati on on branch banking, as
practiced in the United States, group and ch in banking systemsas
developed in the United States and elsewhere , the unit banking
system of the country and the effect of ownership of bank stocks
by investmen t trusts and holding corpor tions.
It
s stated,
among other things, that the Committee from time to time
ould
require additiona l assistanc e from the personnel of the Federal
reserve banks.
ta meeting of the Board on
re present Governor Young
nd
rch 4, 1930, at
hich
ssrs. Platt, Hamlin, filler,
James, and Cunningham, the Governor reported that Dr. Goldenwe iser,
Chairman of the Board's Co
ttee on Branch, Group and Chain Bank-
ing, had stated to him that the committee felt it should h ve the
- 5 -
services of a secretary to devote his entire time to the supervision of the work to be conducted by the Committee, and that,
if the Board approved, he would like to negotiate with a party whom
he had in mind for this position.
After some discussion during
which the effectiveness of such an appointment in securing the data
on brancl. gr-oup and chain banking that the Board desires was discussed, upon motion by •r. Hamlin, it was vote
to authorize Dr.
Goldenweiser, as Chair.I!l.9.n of the Committee, to negotiate for the
employment of a secretary for the committee, it being understood
that the matter of appointment and salary to be paid will be presented to the Board for its approval.
Upon this motion, Dr. Liller
voted "no".
ta meetin
of the Board on harch 13, 1930, at which
were present Governor Young and Ifossrs. Platt, Hamlin, 1.iller and
Cunningham, there was presented to the Board a memorandum dated
~rch 10 from the Connnittee on Branch, Group and Chain Banking,
advising that in accordance with authority given by the Board arr ngements had been made for the employment of
r. J. H. Riddle
as executive secretary of the Conmittee at a salary of wl,000 per
month for a period not less than six months and not more than
twelve.
Upon motion, .fir. Riddle's appointment was approved, Dr.
Miller voting "no".
ta meeting of the Board on pril 23, 1930, at which
ere present Governor Young and Messrs. Hamlin, 1 iller, James o.nd
Cunningham, the
ssistant Secretary referred to the close relation-
ship of the work of the Board's cormnittee on branch, group and
- 6 -
chain bankin
serves
to that of the
hich h d the
sugges tion
eder 1 re e
e banks' coI:l!llittee on re-
e person nel, and submit ted to the Bo
hich h d been made that the commit tee on branch , group and
ch in b nkin
be tran ferred to the •ed ral reserve banks and
st tus simila r to that of the co
iven a
ttee on member bank reserve s.
fter discuss ion, upon motion , the Govern or
munica te
d a
1th all Federa l reserve banks,
as
equeste d to com-
dvising that, subjec t to
their approv al, the Bo rd h d voted to change the commit tee on branch ,
group
d chain b nking from a Board to a bank coIIIIJlittee.
On
of all the
pril 24, 1930, Governor Young address ed to the Govern ors
eder
reserve b nks a telegra m stati
voted, subjec t to the appro
the commit tee on branch ,
1 of the
that the Bo rd had
ederal reserve banks, to change
oup and chain b nking from a Board to a bank
commit tee, its expens es to be borne pro r ta by the
b nks as
ederal reserve
ere expens es of the commit tee on reserv es.
On
pril 30, 1930, at a me ti
of the Board
t
presen t the Chairm an, Govern or Young and I essrs. Hamlin ,
Cunningham, the Govern or reporte d to the Boar
receive d from
t ken
11 of the
eder
hich
ere
iller and
that advice ha
been
reserve banks approv ing the action
t the Ill8etin g of the Board on
pril 24 in voting to chan
Bord's commit tee on branch , group and chain banking from a Bo
bank co
ittee,
d sugges ted that the transfe r be
and th t
Ir. -. H.
fro
o rd's rolls as of the clo e of busine s
6
1
the
iddle,
to be p id beginn ing
de
the
d to
s of ?Jay 1
ecretar y of the Comoit tee, be removed
y 1 by the le
pril 30, his
Yo1•'' b nk in the s
- 7 -
manner as that of
• Riefler, who
as serving as Secretary of the
banks' committee on member bank reserves.
Upon motion, the recom-
mendation of the Governor was approved •
On
ernors of all
.
pril 30, 1930, Governor Young addressed to the Govederal reserve ban'rn, except New York, a letter
(X-6580), of which a copy is attached, stating that replies to
this telegram had been received from all -ederal reserve banks,
approvin0 the change, and accordingly that the
make the transfer effective 118.y 1, 1930.
oard had voted to
Governor YoWlg stated
that it was understood that the status of the Committee would ba
the same as that of the bank committee on member bank reserves
and th tits expenses would be borne pro rat
by the Federal re-
serve banks under an arrangement similar to that determined on for
the committee on reserves.
ta meeting of the Bo rd with the Conferences of Chairmen and G-0vernors of the
at whioh
James
eder 1 Reserve Banks on eptember 26, 1930,
ere present Governor
eyer and P'essrs . Hamlin, rlller,
nd Cunningham, the Governor suggested that the first order
of business for the meeting be the reports of the System Committees
on Branch, Group and Chain Banking and reserves.
ccordingly, Dr. Goldenweiser, Chairman of the Committee
on Branch, Group ann Chain Banking read to the meeting a written
report reviewing the appointment of the CoirUnittee and pro
ess to
date in its investigations •
• t the suggestion of Dr. Miller the report was amended
- 8 -
by the eliminati on of the phrase
tions of the
ederal
Dr.
ccordance
ith the reco
enda-
dvisory Council and the fall conferenc es of
Governors and •eder l Reserve
ment
In
nts in 1929 11 , preceding the
ttee's appointme nt by the
ederal
tate-
serve Board.
·11er stated th t whereas the subject of branch, group and
chain banking h d been under study by the Board for several years,
the
bove phr se intimates th t the matter was not given cognizanc e
by the Board until brought to its attention by the Feder l
Council and the conferenc es of Governors and Federal Reserve
t the su gestion of
in vie
of the interest of the
• James it
eder l
as decided, ho ever,
nded, be forwarded
s
to each member of the Council for his informati on.
report,
gents.
dvisory Council in the sub-
ject, that a copy of the Committe e's report,
note:
dvisory
( ecretary• s
ilhile the records do not show that copies of the Committe e's
nded, were forw
s
ded to members of the
ederal
d-
visory Council, Dr. Goldenwe iser states that it is his belief that
such copies were sent.)
Inquiry as to the length of time necess
to complete the
Committe e's survey brought out that it would not be pos ible for the
Committee to submit its fin 1 report for
necessity for dispatch
t least six months.
s stressed, although it
as the
the thoroughn ess of the investiga tion should not be
its
The
eeling that
acrificed to
peedy completio n.
t
meetin
on November 10, 1931, the Bo rd approved a
letter addressed to Senator Glass by Governor
eyer, transmitt ing
- 9 -
a prelimin ry volume of statistic s which had been compiled, at the
request of Senator Glass, from informati on obtained by the committee on branch, group and chain banking.
This prelimina ry volume
was forwarded for the use of the Subcommi ttee on Banking and Currency of the United States Senate.
On Tovember 30, 1931, the committee submitted a report
dated Jovember 28, 1931, to the Conferenc e of Governors and Chairmen showing pro ress made to that d te.
copy of this report is
att ched.
On December 2, 1931, Secretary ~rrill
ddressod to each
Governor of the Federal reserve banks a letter st ting that, during
the meeting on that date of the
Group and Chain Banl<ing
ma.de that each
d t
ederal Reserve Committee on Br nch,
ith the Governors Conferenc e, a request
vernor be furnished
hich h d been submitted to the
Currency of the United St tes Senate
s
ith a copy of the confiden tial
ubeomraitt ee on Bankin
hich
and
s engaged in a survey
of the oper tion of then tional and ~eder 1 reserve banking systems,
and a copy as inclosed with the letter with the request that it be
regarded as confiden tial.
On
y 23, 1932, Dr. Golden eiser brought to the attention
of Governor .eyer five volumes of
terial
hich h d been prepared
in p 1.iminary form and aubmi tted to the Committee on Branch, Group
and Chain
nkin
as follows:
- 10 -
Bank Suspensions
Branch Banking in Canad
ranch Banking in ngland
Chan es in Number & Size of Banks in United States
Banking Costs and Profits.
t the sw gestion of Governor !~eyer these volumes were
submitted to Dr.
'ller for examination and later
ere returned by
Dr. J iller to Governor layer's office.
ta meeting of the Board on June 6, 1932,
t which
ere
present Governor .eyer and l cssrs. Hamlin, ~iller, James and 1'.:.a.gee,
reference
dated
as made to a memorandum (a copy of which is attached)
y 23, 1932, from Dr. Goldenweiser, as Chainnan of the Com-
mittee on Br nch, Group and Chain Banking of the •eder 1 reserve
system, submitted at the request of Dr.
·11er, in connection with
the budgets of the Federal reserve banls for statistical and analytical
lined the
ork for the year 1932.
ctivitie
of, and
Dr. Golden eiser's memorandum out-
ork done by, hi
committee since its
organization, contained a list of eleven studies undertak-en by the
committee,
nd reported th t the expenses of the con:unittee to
15, 1932, amounted to
tached to the
·1os,ooo,
emorandum..
ork which
.ould
as sho n by detuiled exhibits at-
The IllE:morandum stated that it
mated th t expenditures from
pril
s esti-
pril 15 to the end of the committee's
ould be completed between October and the end of 1932,
ount to about
35,000, exclusive of costs
incurred in printing the committee's report.
Dr.
hich might be
iller expressed
the opinion that whatever value the committee's report might have
ould not justify the expense involved.
est ted th t, in his
- 11 -
opinion, the necessary studies could have been completed before that
ti
, at a much smaller cost, had the scope of the committee's activi-
ties been more definitely planned at the inception of its investigation,
hich was initi ted in the
pring of 1930.
Dr. Goldenweiser stated that
the personnel of the committee was the same as that of the System Committee on 'ember Bank Reserves, that it had not been pr cticable for
them with their other duties to give much individual time to the work
and that in vie
ide scope of the subjects to be covered it had
of the
been necess ry to employ
number of people for
considerable length
He added that, while it might be possible to reduce the pro-
of time.
posed future expenditures somewhat, an arbitrary reduction might mean
the elimin tion of certain data which would be very valuable in the
completed report.
ction was deferred on the matter.
On July 7, 1932, there
Hamlin, James, Ia.gee,
1
'..
a circulated to Pessrs. _eyer,
ller and Pole a memorandum dated July 6, 1932,
addressed to Dr. Golden1eiser by !r. Riddle, stating that the expenditures of the Committee on Branch, Group and Chain Banking from
16 to June 30, 1932, a
pril
regated vl3,184 and that tho total expendi-
tures of the Committee from its beginning to June 30, 1932, aggregated
It 1as men-
·121,247.83, of which salaries amounted to ~98,219.31.
tioned that
.:r.
n item of travel amounting to
Greer to Californi
connection
531.10 covered a trip by
from the end of ~rch to the middle of
ith the study of branch banking in that
On-u.., st 4, 1932, there ms circulated to
James,
1
yin
tate.
essrs. !eyer,
ee, liller and Pole (I.:r. Hamlin being absent)
roomor ndum
.
.
-12from !r. Riddle addressed to Dr. Golden eiser stating th t the expenditures of the Connni ttee on Branch, Group and Chain Ban1 in
the month of July ag regated
this an:ount included
7,422.22.
The statement
durine
as made that
2,949.19 reimbursed to the Federal Reserve Bank
of [inneapolis for extra clerk hie in connection with the research
project
hich I~. Powell of that bank had been ma.kin
for the Com-
mittee.
On September 9, 1932, there was circulated to 1:essrs. Heyer,
Hamlin, James, } gee, and ?.:J.ller (Mr. Pole being absent) a memorandum
from
1:r. Riddle to Dr. Goldenweiser statini:r that the expenditures of
the Committee on Branch, Group and Chain Banking during the month of
ugust aggregated w3,944.53.
ta meeting of the Executive Committee of the Board on
November 3, 1932, at which
Hamlin, I'l!iller and
ere present Governor Heyer and l!essrs.
agee, Dr. Goldenweiser reviewed briefly the
activities of the Committee on Branch, Group and Chain Banking since
its appointment on February 26, 1930, and outlined the studies which
had been mde by the committee in connection
status.
ith its ,ork and their
He stated that these studies would be presented to the Board
as a part of the complete committee report; that the committee
as
then in session preparing a short report which would present in summary form the information developed by the detailed studies; and that
it was hoped to have the short report in the hands of the Board iithin the next fe
days.
general discussion of a nwnber of problems
in the field of the committee's investigation ensued.
.
"'
- 13 -
During the meeting of the Federal Reserve Bo
d rith the
Feder 1 reserve agents and the Governors of the Federal reserve
banks in
shington from November 14 to 16, 1932, inclusive, Dr.
i
Goldenweiser made a short statement of the results of the work of
the Committee on Branch, Group and Chain Banking and distributed
copies of a preliminary confidential surmna.ry of the results of the
Committee's
ork which it
as indicated would be embr cad in approxi-
mately t elve volumes of typewritten manuscript, some of
hich he
stated had not been completed and others were in process of being
edited and corrected.
On November 21, 1932, at a meeting attended by Governor
ieyer and Uessrs. Hamlin, ·•iller, J
brought to the attention of the
es and .. gee, the Governor
ard a confidential copy of a
dr ft of a portion of the proposed Annual Report of the
ecretary
of the Treasury for the fiscal year 1932, in which had been incorporated numerous quotations from the preliminary and confidential
summary which Dr. Goldenweiaer had presented at the joint meeting
of the Board ,ith the Feder 1 reserve agents and Governors.
matter i s discussed and it
The
as found to be the consensus that,
since the report of the Committee was subject to revision and had
not been released for publication, it 1ould be preferable for the·
Secretary of the Tre sury to refrain from referring to it in his
nnual Report.
On .. ovember 22, at a :rreeting at which the same members
.
•'
- 14 -
of the Board
the
ere present , the Governor stated th the had informed
ecretary of the Board's views and that he understo od that the
Secret ry had revised his report to elimin te all referenc es to the
Commit tee's summary.
r 2,
r
932
r.
i
In co
inclo e
t
io
lit
co y of
it
her
of 1
1 l tion
i
confi
en
b nlc-
••
eopi
l not
to t
h
n nd
h
c n ti-
rci
ni 1 d co
rondi
for t
JOU
inion on h
r.
li
r
d
te
nti 1.
ey
trul
our ,
trietly
o inio
December 24, 1932.
Dr. E. A. Goldenweiser,
Chairman, Committee on Branch, Group and Chain Banking,
Federal Reserve Board,
Washington, D. C.
Deer Dr. Goldenweiser:
In the investigation of the causes of bank failures, the Committee on Branch,
Group and Chain Banking found that many banks had become involved because they had made
too large a proportion of·their loans ~without proper regar§. for prior liens."
The practice of country banks making production loans to borro ers whose
fixed assets (farms) were subject to prior liens has been made almost unavoidable because the agencies holding the first liens either could not lawfully make additional
loans for cropping purposes, or declined to do so.
Of the former, I have in mind the Federal Land Banks principally. While these
institutions make long-term advances against first liens on farm lands, they are without
legal authority to make seasonal production loans, although it is necessary for the farm
owner to raise a crop if amortization charges, interest, and taxes are to be met.
If the country bank, as it probably should, declines to take the risk of
financing the crop while the land on which it is grown is mortgaged to others, the
farmer is checkmated.
The wa out of the dilemma, it ~eems to me, is to authorize Federal Land Banks
when holding an snEIUately secured first mortgage to grant seasonal loans for crop-raising purposes, sucn l:ldvances to be secured by second mortgage on land (if' not already
provided for under an additional advance clause in the first mortgage), together with
mortgage on crop, and mortgage on chattels.
The lien on the crop would enable the Land Bank to obtain the first proceeds
from the season 1 s operations, and the lien on the farm equipment would give the Land
Bank a complete working unit and control. The lien on farm equipment is very necessary
in the case of foreclosure to assure continuance of farming operations.
Land Banks making production advances under the c·rcumstances herein set
forth should be prohibited from carrying crops after harvest. This would assure early
liquidation of seasonal advances and would throw on commercial banks the burden of
financing crops during the m.ar·eting period.
This proposed division of credit activlty would make the L nd Banks complete
in the matter of financing farms, would rid banks of deposit of the hazard of seasonal
financing while in 2, secondary position, and would make commercial institutions of our
banks of deposit.in rural areas.
As the iork of your Committee may bring you close to future legislative activities, I am passing this thought along with the idea that it may present something
rnrth considering. Possibly, Governor Meyer may also be interested.
~,llh/c --,
Yours very t,-,,J:y,~
,1ember of Committee.
camber 23, 1932
r. Go l en 1 i s r
r. Hi
le
e h ve . de many revisions .:md correctio n
table
of this
tudy "" but h
e not
de the c
n
in t e
t tistical
son these copie •
For= No. 131
~
FEDERAL RESERVE
Offi ce Correspon
To
BOARD
orrill.
Subject:
From _ _ L- Gold~
...
I retJ.rn herewith thE'
b
.
· tte
co
i.n
ber , 1930 r
t e Sc t
ort of
l Adviso y Co, ~c·i.
e
arentl r h
e a
h'stor
at rial on t
V"'
no r cor
. v·,
of
ro r ss to thP
I believe , ncv r~
oft e branch
bers
,
lPf'
th
SPTit
t
+'
f
t co ies were
er::t .
m ntion sho 11d be
I be iev
add' · onal re ort of
28 , 1931, +here
co
itt
+0
the c nfer nc
s oistribu te
un o.1Jte Lt
to the Bo rd d t d
d
a
ro-rress
,-\
I t in
buikin
co
ort
To my me o an-
!:lo rd .
is re ort of
s att rhed .
e oft e
+-
ct t
ton
ov ber
st of S n tor Gl ss, a pr 1 · inary vol1.1ID
A co".ly of Governor
oved
p
infor
,ion int eh
t e;:,; tran
eyer '
th
Bo d at itlme
offici l carbon of lat etter
Th
Co ie
r liminary volume
oft i
a, ·
ed r 1 Reserve Bo
menbers
f th
r
of
of the branch
s
ittee for the use of the Bank ' g and Curr ncy Committee of
to Sen to
b n s.
co 7
ic
Ch irm n ,
r ferred to
s con led from th
the Se"lat"' .
931.
to memb1=>rs
mention :.:hould also be
1
ro r ss ~deb· the
o Gov~ ~ors an
~
stated t'1 t
10, 1931, at t1e re
statist· cs
ae of the fact t\.i ton
1
m
oran
ft,..
is attached .
w
de
s
... ro
F.r>
ell
to
i.n
re giv
,I. .
ul.n
on
o r fil
t\.i s
t ri 1
ov 1ber 10,
and is attac e
to the members of the
s t0 the Govlrno r
cCl 11
it in
oft e
d tran m'ttin
e ior
e ber
oer 1 re erve
conie fort
of tie staff
.
-.,..
FEDERAL RESERVE BOARD
WASHINGTON
Mr. Morrill:
ith regard to a notation in the Minutes
showin
that at a meetin~ on September 2!), 1930,
Mr. James made the suggestion that in view of
the interest of the Federal
dvisory Council in
the subject a copy of the Committee's Report of
September 24, 1930, as amended, be sent to each
ember of the Council, Mr. Goldenweis er's
Secretary transmitted a copy of the report
with a note as follows:
"e have no record nor recollectio n
of having sent this report to the
Federal Advisory Council members."
There is nothing in the General Files to indicate that it was sent, and no letters of acknowledgment from any of the Members of the Council.
The memo of March 10, 1930, / concerning Mr.
,I
Riddle, and 1:he memo of Ma _::. are a part of Mr.
Golden eiser's files.
Attached.
ydw
.,Ponn.Jl.18 1
-
Offic e Corre spond ence
To
--
FEDERAi. RESERVE
BOARD
r . Farr · c-on
Date
Subject:_
From
I
e ,o
2-8495
Fo Cl ULATICll: ____ _
Att c ed i
co
o...
earnir::. " .. or t e
t .
t·
Prof·
..,
ll t d .
V
used
1
.
or
to b
~1
----
-------
--
--
----r. ------ --- --------
FEDER.\L RE ERVE CO\I\UTTEE ON
BRANCH, GROUP A ·o CHAI.. BANK! 'G
ANALYSIS OF BANK EARNINGS
(l.Jse a separate blank for each year for each bank)
tate
Year_ _ _ __
ame of ban·
City _ _ _ _ _ _ _ _ _ _ __
Federal Reserve District
o. _ __
NoTE.-See page 4 for instructions as to exact composition of the items below and the reconciliations from one report to another.
EARNINGS AND EXPENSE FIGURES
(Aggregates of the two semi-annual reports)
Amounts in dollars
(omit cents)
A. Interest and discount on loans and investments ........................... $__________ A.
B. Other earnings ....................................................... .
B.
C.
Total earnings ................................................. .
C.
D. Salaries and wages .................................................... .
D.
E. Interest paid on gross deposits ......................................... .
E.
F. Other expenses ....................................................... .
F.
G.
et earnings before losses ....................................... .
========
H. Net losses ........................................................... .
I.
Total expenses and losses ........................ (D
H.
+ E + F + H) ========
J. Net addition to profits ... . ............................................ .
G.
I.
J.
CONDITION FIGURES
(Average of Spring, June, Fall and December calls)
K. Loans and investments ................................................. $__________ K.
L. Capital, surplus, profits and reserves (except reserves for expenses, etc.) ..... .
- - - - - - - - - L.
M. Time deposits (including postal savings) ................................. .
M.
N. Gross deposits (bank, demand, time and U.S.) ........................... .
- - - - - - - - - - N.
OTE.-ltems K to should be checked individually before computing the ratios.
the earnings and expense items.
Checking the percentages on page 3 will check
PERCENTAGES OF GROSS EARNINGS
Per cent
(two decimals)
1. Intere t and discount on loans and investments ........... (A + C)
- - - - - - - 1.
2. Other earnings ................. ................. ...... (B + C)
=======
3. Salaries and wages .. ......... ................. ........ (D + C)
- - - - - - - 3.
4. Interest paid on gross deposits ................. ......... (E + C)
- - - - - - - 4.
5. Other expenses ................. ................. ...... (F + C)
5.
6.
Net earnings ................. ................. . (G + C)
======
Total expenses and losses ................. (3
100%
6.
7.
7. Net losses ................. ................. .......... (H + C)
8.
100%
2.
+ 4 + 5 + 7)
8. }
9. Net addition to profits ................. ................. CJ + C)
100%
9.
PERCENTAGES OF LOANS AND INVESTMENTS
10. lntere t and discount on loans and investments ........... (A + K)
10.
11. Other earnings ................. ................. ...... (B + K)
11.
+ 11)
12.
13. Salaries and wages ................. ................. .. (D + K)
13
12.
Total earnings ................. ................ (10
14. Interest paid on gross deposit ... ................. .... .. (E + K)
15. Other expenses ................. ................. ...... (F + K)
14
15.
et earnings .................. .................. (G + K)
16.
17. Net losses . . ..... .......... ............ ............... (H + K)
17.
16.
18.
Total expenses and losses ............ (13
+ 14 + 15 + 17)
j
18 }
et addition to profits ................. ................ (J + K)
19.
20. Capital, surplus, profits and reserve ................. .... (L + K)
20.
21. Gross deposits . . . . . ................. ................. (N + K)
21.
19.
l
= Item 12
= Item 12
OTHER PERCENTAGES
22.
et earnings (before losses) to invested capital. ........... (G + L)
_ _ _ _ _ _ _ 22.
23.
et addition to profit to invested capital ................ (J + L)
- - - - - - - 23.
deposits ................. ........ (M +
)
- - - - - - - 24.
25. Invested capital to gross depo its .................. ...... (L +
)
_ _ _ _ _ _ _ 25.
26. Interest on deposits to gross deposits ................. ... (E + N)
_ _ _ _ _ _ _ 26.
24. Time deposits to gro
OTE.-Check ratios by seeing that: (a) Items 1 + 2 equal 100 per cent; (b) Items 3 to 6 equal 100 per cent; (c) Items 8
19 equal item 12; (f) Items 20 to 26 are calculated twice.
equal 100 per cent; (d) Items 13 to 16 equal item 12; (e) Items 18
+
+9
RECONCILIATION OF EARNINGS AND EXPENSE FIGURES OF NATIONAL BANKS
The following shows the individual items on the various reports of earnings, expenses, and dividends during
1926- 1929 which should be included in the earnings and expense figures on page 2 lahelled A to J.
Earnings and expense report for six
months ending-
Interest and
discount
on loans and
investments
Other
earnings
Total
earnings
Salaries
and
wages
Interest paid on
gross deposits
Other expenses
Net
earnings
(before
losses)
Net
losses
Net
addition
to
profits
A
B
C
D
E
F
G
lJ
J
l(a)
l(b)tol(f)
1 (Total)
2(a)
2(c)
l(c) to l(i)
do
do
June 30, 1926 ................................
Dec. 31, 1926 to Dec. 31, 1929, inclusive ........ 1(a)
+ 1(b)
2(c)
+ 2(d) + 2(e)
2(b)
+ 2(d) + 2(e)
3
5 minus 4
6
2(b)
+ 2(f) + 2(g)
3
do
6
RECONCILIATION OF CONDITION FIGURES OF NATIONAL BANKS
The following shows the individual items on the various reports of condition during 1926-1929 which should
be included in the condition figures on page 2 labelled K, L, M, and N.
Loans and investments
Capital, surpl11s
profits and reserves
Time deposits
(including postal
savings)
K
L
M
Apr. 12, 1926. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Items 1, 2, 4 and 5 minus the sum of items
f and g of schedule 5 and items 38 and 39
of liabilities.
I terns 17 to 19
I terns 33 to 36
I terns 22 to 37
+ g of schedule 5
Items 19 to 21
Items 35 lo 38
Jtems 24 to 39
do
do
do
Reports of condition as of-
June 30, 1926 and Dec. 31, 1926.. ....................... ... Items 1 to 4 minus items f
Mar. 23, 1927 to June 30, 1928, inclusive .................... Items 1 to 4 minus 45
Oct. 3, 1928 to Dec. 31, 1929, inclusive.... ... .. ... .......... Items 1 to 4
Items 15 to 18
I t{'m 23
,ross deposits
(hank, demand,
time and U.S.)
Items 21 to 24
--
•
•
Docember 20, 1932.
Jemorandum to Dr. Golden eiser:
I att ch
to me by
•
memor
dum d t d ecember 15 a dressed
cClelland of it ms show by the minutes in re-
g rd to the Committee on Branch, Group and Chain Banking.
I also
ttach a rough draft on
from the file
re
rdi
thered
hite paper of items
s you
this committee .
no , I am
tion
ende voring to com ilea complete st tement of info
hich
s brought to the
ttention of the members of the
Board reg rding this committee and hon all of the ite
ddi-
have been g ther d the to memoranda att ched and any
tional informati on
hich
will
111 be consolida ted in one memor ndum
111 set forth the feta in chronolo ic 1 or er.
ppreciate it if you
s possible
ill as quickly
tion that
the o memoranda and add to them any info
round out
n
ttention of the Bo rd members at any t
ttacbmen ts.
C -
sit c
complete the history so fr
e.
I
o ov r
ill
to the
,
,
9
,
•
1
'
r 7, 19.32
r.
I
d
t
d
nd n
I h
t di
Y,
you
int
r co
d
r
o
ort
co
to hold
i
f'ir t,
•
•
December 16, 1932
iss Deeds:
ccording to the
been
rious memoranda and letters prepared on Branch, Group
and Chain Banking, some of
eral
inutes of the Board there have
iles.
hich are missing from the Gen-
ill you be good enough to see if you h ve any
of the following:
emorandum dated iarch 10, 1930, from the
1.
Committee on Branch, Group and Chain Banking
• J. H. Riddle had been emdvisi a that
ploy d as Executive Secretary of the Committee.
( esented to the Board on March 13, 1930.)
✓
2. Copy of letter sent to each member of the
Federal dvisory Council transmitting revised
report of Coimnittee dated September 24, 1930.
3. iemorandum dated May 23, 1932, from lr.
Goldenweiser regarding the activities and expenditures of the Committee. (Presented t
Board meeting June 6, 1932.)
If you are successful in locating any of these I would like
to have them sent over for Hr. lorrill's use.
I
o.1a1
•
-
Office Corresponaence
FEDERAL RESERVE
BOARD
To _ __..Mr~-~r_.~or_r~il_l~- - - - -
Date necember 15, 1932.
Subject: ,Appointment and history: of the
Committee on Branch, Group anl hain
Banking
From i:.:r .....cClelland
••o
t a meting of the Federal
at iThich
ere present Governor Young,
Gunningb.am, there
2-8406
eserve Board held on December 12, 1929 ,
Iessrs . Platt, Hamlin, riller , James and
as discussed the action of the _'ederal Reserve Agents'
on-
ference in voting to concur in the recom:nendation of the ,ederal Advisory
Council that the 7ederal {eserve Board appoint a committee to study the merits
of the branch banking system as practiced in this and other countries, the
oup or chain banking system as developed in this country and elsewhere, the
unit banki
system of this arrl other countries am the effect of ovmership of
bank stocks by investment trusts and holding corporations, in order that the
Board may be in possession of accurate and authoritative information on the
subject.
During the discussion, Hr . James moved that the Board approve the
appointn:ent of a cor.nnittee as suggested by the Federal Advisory Council and
approved by the _ederal Reserve Agents, to
it:-
"To study the merits of the branch banking system as practiced
in this and other countries, the group or chain banking system
as developed in this country and elsewhere, the unit banking
system of this and other countries and the e feet of ownership
of ban..~ stooks by investmrnt trusts and holding corporations, in
order that the Board may be in possession of accurate and authoritative infornntion on the subject."
said committee to be composed of one mm selected by the Governors of the •ederal Reserve banks, one by the ~ederal Reserve A~ents, one by the
visory
ouncil and one by the
ederal Ad-
ederal Reserve Board, together with the
Governor of the board as exof icio member, and to be emp011ered to employ, with
the a.9prova1 and at the expense of the Board, such expert services as may be
necessary.
-21
.A:f'ter a recess the Board reconvened rith the sare rn.ei::i>ers
resent as
attended the morning session and the appointment of a committee, as reconmended by the •ederal
dvisory Council and the "ederal Reserve , gents
as further
discussed and J.::.r. I iller submitted a substitute for the mot ion mde by I.::r.
James at the morning meeting which was finally amended to read as follo s:
"That in order to expedite the assembling of data on branch,
group and chain bankin that is being carried on in the Board's
Division of ank Operations , a committee of i'ive be appointed by
the Board, as reconnnended by the ·ederal Advisory Co cil and
the Conference of Federal Reserve Agent~ , to assemble and digest
infollllation on branch banking as practiced in the United States,
group and chain banking systems as developed in the United States
and elsewhere, the unit ban.kine; system of this and other countries
and the effect of ownership of bank stocks by investment trusts
am holding corporations, in order that the Board may be in
possession of accurate a:nd authoritative information on the subject."
t the conclusion of the discussion, Lr. :iller's
substitute motion as put by the Chair and carried,
I • CUnningham not voting.
At a meting of the Board on •ebruary 26 , 1930, at which were present
Governor Young, I essrs. Platt , Hamlin , Uiller, J
Young stated that he r~t this morning
es, and CUnnir.gham, Governor
ith the connnittee recently appointed to
make a study of the subject of Ill')mber bank reserves and had su
comnittee that the Board
sted to the
ers of
ay .ind it desirable to al.so appoint the
the committee on reserves as a committee to study the develo_ nent or chain,
group and branch banking in the United States.
comnittee would have to
He stated that, ina.
uch as the
ive considerable thought to this subject, in connection
iith its study on reserves, the mn:i:lers .ould be
illing to serve on both
committees should the Board desire to take such action.
ter discussion, upon motion, I essrs. Golden eiser and
ead or the Board's staff, and l essrs. ound.s, lemin and
,lerk, representin the Federal Reserve banks, were appointed
as a committee to assemble and digest information on br ch
bankin as practiced in the United States, group and chain
banking syste
as developed in the United States and elsehere, the unit banking system of the country, and the ef ect
of ownership of bank stocks by invest!ll3n
corporations.
trusts and holding
t a meeting o· the Board on .arch 4, l930, at which ,ere present
Governor Young,
~
essrs. Platt, Hamlin, ' iller, James, and v'unn:ingham, the
Gover or reported that Dr. Goldenneiser, Chainnan of the Board's Committee on
group, chain and branch banking, had stated to him that the committee
eels it
should have the services of a secretary to devote his entire tiim to the supervision of the 10rk to be conducted by the Committee,
am
that, if the Board
approves, he would like to negotiate m.th a party whom he has in mind for this
position.
After some discussion during hich the effectiveness
of such an appointtmnt in securing the data on group, chain
and branch banking that the Board desires was discussed,
upon motion by •r. Hamlin, it a voted to authorize Dr.
Golden eiser, as Chairman of the Committee, to negotiate for
the ernploymmt of a seer tary 1br the committee, it being
umerstood that the matter of a:ppointmmt and salary to be
paid will be presented to the Board for its approval.
Upon this motion, Dr. I iller voted "no".
At a meeting of the Board on Larch 13, l930, at
Governor Young,
.essrs . Platt, H
presented to the Boe.rd a
lin,
iller and
hich were present
ingham, there
morandum dated 1 arch 10th fro
o
the
as
ittee on
Branch, Chain and Group Banking, advising that in accordance ,ith authority
given by the Boa.rd arrang
ants had been ma.de
Riddle as executive secretary of the
1,000 per month
omrnittee at a salary of
for a period not less than six months and not
Dr.
or the employment of :r. J. H.
ore than twelve.
• Riddle 's appointment
Upon motion,
"no".
iller voting
as appro ed,
At a meeting of the Board on .arch 2 , 19::JJ, at rhich were present
Governor Young,
essrs. Hamlin,
iller, J
s and
Secretary referred to the closer lationship of the
vammittee on group , chain, and branch bankin
tot
nningham, the
sistant
ork of the Board's
t of the
ederal
eserve
-4-
banks' committee on reserves
hich has the seJlD personnel, and subI:litted to
the Board a suggestion which has been nnde that the committee on branch, group
and chain banking be transferred to the Federal Reserve banks and given a
status similar to that or the committee on member bank reserves.
ter discussion, upon motion, the Governor as requested to comounicate ith all ederal eserve banks, advising
that, subject to their approval, the oard has voted to change
the comnittee on roup, chain and branch banking from a Board.
to a bank committee.
30, l<:}30, at a meting of the Board at which were pr sent the
Chairman, Governor
oung, 1.essrs. Hamlin, l'iller and 8\lnningham, the Governor
reported to the Boa.rd that advice has n0\7 been received from all of the Federal
Reserve banks approving the action taken at the m,rnting of the
oard on
pril
10
24th in voting to change the Board's committee on group, chain ard branch
banking from a Board to a bank cor ·ttee, an:l sugge3ted that the transfer be
de as or l.ay ls t and t
t J • J.
n.
iddle, Secretary o
the
mm.ittee, be
removed from the Board's rolls as of the clooe of business today, his salary
to be paid beginning ".AY 1st by the 1 e
f
.::r.
iefler,
Yoit bank in the sBJre manner as that
o is serving as Secretary of the banks' col1ll'ri.ttee on
100
ID r
bank reserveso
Upon motion, the recomr~ndation of' the Governor
pproved.
as
At a rooeting of the Boa.rd with the Conferences of Chai
Governors of the Fe eral
present Governor _eyer,
Governor suggeste
reports of the
eserve Banks on
essrs. Hamlin,
n and
eptomber 26, 1930, at uhich
"iller, Jaroos and
min
ere
am, the
that the first order of business for the meting be the
ystem Committees on Branch, G oup a.Di
Accordingly, Hr. Goldenweiser, Chairman of the
Group and Chain Banking read to the meeti
ha.in Banking an
eserves.
omrnittee on Branch,
a written report revi~ing the
appointnnnt of the Co:r.nnittee and progress to date in its investigations.
ggestion of
t the
tion o
ederal
confer nee~ o
t the
tes t
Governors
the •ederal
sub ect o
branch,
ars,
veral
d the
ever, in vie
o
er of' th
e
o
ject, th t a cop
s
or
ouncil
tion.
his
urvey brou
tout that it
its
inal r port
st
sad, althou
tir:e necessary to co
to the length o
Inquiry
or at le
ill not be pos ible
\
t a
Gove nor
a
e er,
of th
oar
y 2, 19 2,
t tee on Branch, G up
t the re uest o
itto
ederal
rve b
speedy c
ro
.ir• • :iller,
or st t
tical
its o
hich
the invest
ing of the
in co
ec ion
m
alyti
ere pres nt
e erence
as
Chair
of
eiser,
ederal
ese
S
o k
e e
108,000, and that it 1
de to
he
tem, sub-
of the
lth
or the
activities of,
aniza.tion and reported 'that
pril J...'5, 1932, amount d to
a
letion.
• Golde
ain B
spa ch
0
on June 6, 1932, at
randum outli ed th
•
tt
or
in, ll.ller, Jru s
essrs.
orandum dat d
ommittee to submit
or tho
as the feeling tb.a t th
it
ti
lete the
ihe nee ssity
onths.
t s
tion should not be s crificed to it
to
nt by the
for
decided, h
a
ended, be for arded to each
ttee's r port ,
a pain
ants.
ouncil in th
dvisory
e
ese
dvisory Council
ederal
eserve
ederal
nd
oar
edoral
as not given cognizance by the
tter
t the suggestion of JX. Jams it
the interest o
by
has be n under stu
t to its attention by the
Board until brou
ereas th
:r. Liller stated that
o erve Board.
the above phrase int
C
ederal
ttee'
nt of th
the state
recedi
oup and chain bank·
Co
of the
ouncil and the foll conferences of Governors an
ents in l 29",
e elimina-
nded b
s
_datio
eco
ith the
In accordance
the phr se
dvisory
iller the report
ri.r.
ark
nse
1
2.
one by, his
of the co
estin t d that e
tte
nd.1-
-6-
tures from April 15 to the eno. of the comnitteets
ark
hich will be completed
5,000, exclusive
between October and the end oi" 1932, will 8!!'l.Ount to about
of costs
::r.
hich 1t1ay be incurred in printing the committee's report.
iller
expressed the opinion that whatever value the committee's rep ort might have
ould not justify the eAl,)ense involved.
He stated th a t, in his opinion, the
necessary studies could have been completed before ncm, at a nru.ch Simller
cost, had the scope of the committee's activities been more de initely planned
ich was initiated in the Spring or
at the inception of its investieation,
19::x).
r~. Goldenweiser stated that the personnel of the committee as the s8.Ill:l
as that of tho System Committee on I etlber
ank Reserve..,,
at it had not been
practicable for them .ith their other duties to give much individual ti
work and that in vie
ide scope of the subjects to be covered it had
ploy a number of people for a considerable length of time.
been necessary to
He added that,
of the
mile it might be possible to reduce the proposed
penditures son:e ,hat, an arbitrary reduction mi
certain data
to the
hich
ture ex-
t :rman the elmim.tion or
ould be very valuable in the completed report.
Ac~ion was deferred on the matter.
t a neeti
of the "xecutive Conmi.ttee of the Board on l ovember 3,
V
1932, at which were present Governor
eyer,
essrs. Hamlin,
J.ller end I a 0 ee,
i:r. Goldenweiser revie ed briefly the activities of the Committee on Branch,
Group and Chain
ank
since its appointmont on •ebruary 26, 1930, and outlined
the studies which have been made by the coirl'.lli.ttee in co
and their status.
ection with its
He stated tba. t these studies will be presented to the Board
as a part of the complete committee report; that the committee is n
pre
rin
ork
a short report which will
resent in summary form the info
in session
tion
developed by the detailed studies; end th· t i t is hoped to have the short report
in the han s of the Board
ithin the next fe
1
days.
_ ge1_eral disc as ion of a
-?-
number of problems in the field of the committe e's investi,a tion ensued, at
the conclusio n of rhich the me ,bers of the coillilli.ttee and ~essrs. Riddle,
Greer and Blattner let the meeting.
f'EDE RAL RES ERV E BAN K OF SAN fRAN CISC O
December 14, 1932
H. Ri ddl e ,
Secret ary, Committee on Branch , Group an
Cha "n
Feder~ l Rese~ve Bo rJ ,
Wash:~gton, D. C.
l'lr . J.
De·
~ . Ri dle :
This
th an
0
vls
Bankinl
umm y
lll ac
o
ledge rece · J
copy of t
10
o ~ your
l etter
Commit tee ' s rec en ' y r -
eport nd Dr. Golde ,eiser ' s memorandum
to the Bo· de lain · ng the pr ' ncip
ch ,ges.
Yours
Deputy Govern or.
•
1◄...EDE PAL RES ERV E BAN K OF SAN FPA TCIS CO
ecember l', l93✓
• J . H. Riddle ,
Secre t y , Comm.l.ttee on Branch ,
Feder al Rese ve Bo rd ,
lashin gton, D. C.
roup nd Chuln Banking ,
Dear Jr . Riddle :
ith
o
lette
of Docember 6, 1932 ,
T
rec iv j
a co~y o the repor t on The Du.al Banin g y tem in the
United
te.tes , which I sh 11 rnvi
t thee r :est mo ent.
Yours ve y truly,
d~?-.
(
.,
.,ZXCERPT FROM THE llNCJT. -.dE FEDERAL RESERVE BOARD: -
/I
-
December 12, 1932 --
Mr. Miller then referred to a memorandum submitted
by
the Chairman
of the COlllraittee on Branch, Group and Chain Banking under date of December
9, 1932, outlining the status of the detailed reports being prepar
Committee and stating that it is expected that the reports will be entirely
completed by the end of Ms.roh, that the expenses of the Committee to date
have amounted to $142,453 and that the estimated additional expense will be
approximately $8,500.
Mr. Miller stated that in his opinion the expenditure
by the Federal reserve banks of additional money for this purpose is not
justified and he moved that the Committee be discharged as of January 1,
1933.
After brief disoussion, Mr. Miller's motion
was laid on the table.
• Form ·o. 181
"
ffice Correspon
To
From
~
B
T i
et of
"tio
:-n-"cultur
ar d by
t
b
V
+
for
i
ve be
t
t
oir:
bers of t e
er t
o
rou
Co
itt~
8r
f
3,1
Co
r th
itt
.on
ftirt err -
e d
0
1
of
1
·t
Co
It
t,
r
in
i+
J nu
'
t
or+
,4
i
ons
t
I
of
.,
e
in-
e.
d
o.
itt
0
n s
co
cl r '
1,
r
ill
th
bo
oft
or
d
The
0
rt-
itt e .
E.,
t
tion
Cl.UC
t
d
of
hich h ve be
r
t<>
n
~
in cooper
orts
Co
Th
ek"' .
'0
o loner in olv s
The r
b-
ick 11s of the De
r.
o t ·
r
re ort
on th i.
r
ic"l 1s bein
Sus nsion,
r
on
eon
of
t e exce tio
·t
tt e
n
into t
t
bee
l t e s
it ed to
is
fo
se
The s
, 5 o.
C
'
on
l
'
•
•
Deoe~ber 9, 1932
• L .. R ... ounds
· Gcvorno r
l
ie Bank
Yor·
Rounds:
you her ·Ni th
din th
of th
Committ ee·
ttached copy
1 in rou hly the
Th
l
mor ndum to
·e have
oort of th chart& a
or have mor ly in ic t d tho lac
oan tr nsfer the chart
t he BU.'!JCM. cy
ort
re they shou 1,1
•
evious &u: :nary
Very truly yours,
J. H.
iddl
ecretary , committe
Group
.nc.
nd Cha in
on Br noh,
nking •
J<'or.lll
-
o. J31
ffice Correspond
To
r
Golde.nweiser
From
r
Riddle
FEDERAL RF.SERVI:.
BOARD
1932
Subject:
This is the only new material we are adding to the Canadian
study on branch banking.
Do you apnrove?
ing with the adequacy of service.
It goes in the cha ter deal-
In editing and ch eking this report,
however. we h ve made enough -ohnnges to make it necessary to remimeograph.
_ 85b -
tt r of th
his
of comma rel l b nkin
'I')
t
.
otice in
of
n
r • l
en r l.
t
rol l
C
it
r oth.
ciliti
tte pt
•
C 8
tion o
ue tio
t
8
r l int
.
to
nt 11 ti
ol e
di te ore it ban
oto
•
roble
by the
COPY OF LETTER
ADDRESSED
TO :
FEDERAL kE~i:RVE BANK OF SAN fRA~ ~ISCO
1
Dcc:e:;ilt>or
7, 1 3
I
Cler :
con
for the crit1c1
o
1
i
2
h
p
t
y O
to h
the
truly • our •
itt
on Br nch,
1ng.
Decenber 6, 1932
Dr. Go ldenwe ise r
Ir. Riddle
All of t e research projects un ertaken by t e staff hove no1
tu
•
to
o ised m
le
VO
nu ori t into
ork t e
nee 11 tl:l
t
ot ions roce i.., d fro
0
in t e proce
l
b r o
tion
one or t o
it
l
e ting hen th
ni
0
ry
u;w
Of
.
ec
ihich n od to b
n
of
t
th t e c
t
it
in
of the co -
ernb r
tion.
prepa
0
efutly
the e repo
ent
t t
th
ance
cco
ibl , in
po
f
ort
vie t e oth r
no., st rted to edit and
ber ...
I
s, und I ost L. te that it
0
l
r. , ok ns
for tho Committee.
t
n
e
s
ic en
r.
or •
to t
ocrot ry three or four · eks to
itt
pot
tim
bout th
eno t in
h
t ble sh
ncco
e to the f ct th t
t of hi
gr cul-
e art. nt of
ickens of the
• D vid L.
only p
iv
e t
111 t
1
delay int is case is
T
bl
boen
d by
pa
is bein
hich
n ions
griculturnl Condition s_!!_~
been comnletad except
fol lo
d
p.
rit i g vil l be necos-
t·on
ry.
T
nd
u
ll
st
bo n
cu
C
t nci
in
,
t
th
or
llo ,
onth.
th
').
1
h
hh
s ~111
ti 11
t
r '
no
t
ol
.
l
e
-ty
la i
r
0
t
i
v-
ero ... te
eople
itin
e
1
hill"' tn
d r
onth t
bou
J~1l1U
to
month
er to
in o
.
11 e. pens s stop
d at thn.t ti
re
Th
.
19 2, u
d
142,45
tur s durin
ce b rth
r vi ion, t
·1oidfld, th
Puttin
t
ld t
at le
print d, it ,7i 11
e d,y for
o
.oo.
Te
rch is
e ti
i te
o
h
be
., ary,
e
2,000.
end of
te of additional
sti
bove
thn
ncl
•
i
ctly to t
iv n di
ber,
o
r endi-
ult imnte ly the
month
111 b
fter
uld b
rint d.
pren ration o
inr-: th
If thy
inter
mimeo raphi
nso of
X
e mont
rob bly be
t ibut ion.
e
8,500.
uh printin,
t th
o al outla
di t e d , or i f a
re
sho·1l
the co
co ld be
umotion bein
m th
ddition
for t e t
pr month but not o;e
nd
volume
of
r
p
,40
as the
vs
r nort
ov
:x
I
out
dition l char
tota
.
If n oth r &t nail cu t r sho ld be n cessa
h th
t ru
eon
t
ill b in
to n.l of
r
ork o
fl
the end
an
1,800,
i eogr
n~ s mi
comnl"ti
nk
sub tnn i l numb r of
the
lu es an
e
t
cd th
no
It
ent and o h r
to the~ lari s t
P r
p r mon h.
_ vG30
l ' 19;'2, ,
re
of
December 6, 1932
iddlo
Dr. Goldenwe ser-Mr.
•
re
b for
t
r port
coul
e made
Dec
o r
r.
l
ber 6, 1932
ing:
olos di
opy of th
p
r
r
ort
__ _!_ _____i_n._g
b·· th
t ff.
ory truly your ,
J. I! . Riddle
o et ry, Co itt eon
O oun n Oh in
nkin .
,nc.
noh,
December 6, 1932
Dr. Goluen
·r.
iser
iddle
I
SU
est you se d the
tes to ,r.
tem int
...
I
m sure
C
ef llyJ nd pa.haps
L.i, .
y tt
as po ~ible, r.o one on
es
ht
uld
e nay
i ht
L,o
he ~taff h
ve m de
lo 1.ppre"'1et e l.r.
ade u cy of o
ntt for hi
tra t ant.
slip-up
uul
cri ti i
groe to chec
st ion.,.
h
tho
legal tr ining
n interp et tion
y ... tt•s O)inion a
t
edit
8
ve b
.'hil
m-
.ing
d enough in the report to
tntion of bnnking la ·,s.
with the lnte
sible
.
in ere
111 b
0
ttached copy of The
n a c ,ref'ul
nd it is
ere
o -
d t ere.
d
oe~b r 6, 1932
ds
B nlt
o k
e r
.md :
r.
ncl o
,e
nd
ppr c · at
hould
your u
d i
st ion
ot thiB
in t
a co ry of t e report on The
t if you could
to
e for u
ea
vi
~
_B_ __..
it
tni
hv
re ort by t
nth if po Sible.
Very t
ly your,
" I. id le
ecret cy, Co
1 t
on
Orou and Chain an rln ,.
nc.
nch,
ece. ber 6, 1932
Dr. Golden e
er
r. ~idle
Here i
n copy of the report on the c.ual bm:tkiug ystem as
pared by the sta!':t'.
your
le
e
u
e Lon
I ho. e you
in ti
i 11 b
b e to r
· it
ud let u
have
fo:- us to revi e t ls report before .Ir. Greer
the month.
re-
c• e
F orn1 • o. 131
Office Corr espo nden ce
BOARD
r. Goldenw ei ser
To
•
FEOERAL RESERVE
Date Decembe r 6
1932
Subject :_ _
From
•••
11 of the rese rch projects un ertaken by the staff have now
is be·ng
ture.
rep-ired by
ro David L. ,ickens of the
apartme nt of ,grlcul-
delay in t i.s case is due to the fact that ·r. i'ic:itens has
Th
been able to gi7e only ~at of his time to the
rom·sed
e that report in about three
eeks,
r.
ork.
i ckens has
nd I estimate that it
will take the Secretar y three or four weeks to work the me.nu cri t into
or the Committ ee.
s i able sha
"/e have now started to edit and revise the other report6 in
accordan ce
ith
he suggest ons receired
mittce, and, in so far as
the
r
Olll!Ili t
ran the ffiAmbers of the co~-
ossible , in accordan ce
embers expresse d at the recert meetin
t
art va.s in the process of preparat lono
these reports mus
a number of
ith the vie~
u
be cnre
som
when the sa'Il!ll ry
Thnt means that each of
lly edited by the Secretar y o There ver
est ions and .uestion
In one or to c se
of
·rhich need to be follo ~d up.
reor aniz,tio n and re~r·tin
will be nece -
sary.
The staf
h s been cut as rapidly
s th
ork
ould
11
nd during the nresent month, Decemb r, the Com.~itt e •s total e p nses
will be
bout
, 100.
month, le· ing only th
rtho
cut
ill be
de at th
wecreto ry, one clerk, and four
ty ists for restenc 1lling and remimeo ra hin
end of the
eno r
the volume o
her-
The salaries
2 - MO&
•
.,.
Dr. Golder.weher---Mr. Riddle
December 6, 1932
of these six people aggregate $1,630 per month.
It is now estimated that
the work of editing and remimeographing these volumes and completing the
volume on .Agricultural Conditions a11d Bank ..,uspensions can be finished
by the end of March 1, 1932, and all expenses stopped at that ti e.
In
addition to the salaries the rent and other expenses will brin~ the total
outlay per month to about ~l,8O0, or a total of about
months January to March.
5,400 for the three
If another stencil cutter should be necessary
in order to mimeograph the reports as fast as they are edited, or if a
substantial number of additional chart reproductions should be necessary,
the expenses might run over ~l,8OO per month but not over
2,000.
The total expenditures of the Committee to the end of November,
1932, aggregated
142,453.00.
tures during December-March is
The above estimate of additional expendi8,500.
If these volumes could be given directly to the printer after
revision, the most of the time and exnense of remimeographing would be
avoided, the assumption being that ultimately they Will be printed.
Putting them through printing, including the preparation of indexes,
would take at least three months.
If they are remimeographed and then
printed, it will probably be six months before the reports could be made
ready for distribution.
FEDERAL RESERVE BOARD
WASHINGTON
December 1, 1932.
emorandum to Dr. Goldenweiser:
I
ould suggest th t you
d
ess
memor ndum to the Board expressing your opinion
as to the number of people and their salaries
and other expenses that will be necessary for
the completion of the work of the Committee on
Branch, Group and Chain Banking, indicting
what re
ins to be done and when it is thought
that the work will be finished and all expenses
terznin te •
C -w
•
•
FEDER AL RESER VE BANK OF
SA
l◄ RANCISCO
()
December 1, 1932.
Dr. E. A. Goldenwe iser,
cha·
man, Co ittee on Br
Federal Reserve Bo rd,
ashington , D. C.
ch, Group a.nd Chain Banking,
Dear Dr. Golden eiser:
ith cons derable gratifica tion, I red in the linutes of the
Governor s' Conferenc e held on November 15, 1932, that a committee of
Governors had been appo nted to dr t reco endat·ons to the Federal Reserve Boerd with reference to proposals for a general reorganiz tion of our
bank.in;, system.
I h veal ays felt that the best kind of b nking eg slation
could be framed by those ho are thoroughl y conversan t with th ba.nlcing and
economic structure of the country, although not engaged in cocpetit· ve b nking. Ordinar ly, one ·ght look to the Ame lean Bwike s Assoc·ati on for
leadershi p. That is a polyglot organizat ion, houever, of groups spe ing
laneuages so di ferent as to hinder the development of a un·ted policy.
Each grou would be satisfied with remedial legislati on which would a feet
some group other than its mm. Simon pure savings bankers have an interest
entirely clif'ferent from those engaged in combined commercial and savings
banking; then again thee is a diversity of interest bet een b nkers operating under St te charte and those operating under National ch rter.
As the situation appeals to me, we c n hope or no ass'st ce
fro the American Bankes Assoclat· on; rather, the usual resistanc e to constructive legislati on may bee ected .from that source.
o y vie, it
select·on of the committee
Ch ir n of the Governor s'
man ould excl de himself
is quite unfortuna te th t the respons· bility for
should have been pl ced on the shoulders of the
Con erence. N t ally, through modesty, the Chairttee h ch he was d acted to choose.
rom a co
The germ of Branch Bankine as lt ppears ln t present developant asp ted on the P ci ic Coast (Call ornia specifica lly). Also, the
present form of Group Bankine had its inception on the Pc· ·c Co st, in the
o one, there ore, h s been more closely in contact
arine Bancorpo rat on.
,1th the upheavals hich sprang from these developments th Gove or C lkins.
A study of the testimony given before Congress
develo ent of Group and Br nch Banking sh
the
rel tive to
ith so h stry hich ppe s to h ve been exceeding ly ell
those ho should be better infor e.
ltte s
be replete
sorbed even by
•
•
December 1, ·1932
Dr. E. A. Goldenweiser - - 2
It seems to me that the Committee would have been greatly strengthened had it included Governor Calkins.
He has not been disallusioned by the
happenings of the past decade; therefore, his kno~ledge and wisdom would be a
guide in formulating legislation, particularly in regard to preventing a
recurrence of certain events which, if repeated, might have dire con equences.
Both the Co1runittee ana Senator Glrss would profit by information
of significance in the consideration of Branch Banking an Group Banking,
which could hardly be made a l'!'latter of public record.
Yours very truly,
Deputy Governor.
Offi~e Correspon•
le
FEIJERAL RESERVE
BOARD
To
Subject: Statement on Control of Chain
From
Banke
...
On page 73 of the Sumnaey Report appears the sentence:
In some oases control has been exercised over a string of banks
with a very small investment, stock owned in one institution
being used as security for a loan the proceeds of which are used
in the purchase of stock in another."
11
This can be supported by at least two references to epecific instaDCee which
r. Blattner thought you might like to aee •
.Alexander Noyes in Forty Years ,2! .American Finance refera to the
Heinztchain of 1907:
11 He had used his stock in one institution as collateral on 'flihich
to borro money; the proceeds he had used to buy stock in another
b8.Ilk, repeating the process with each new acquisition. • • 11
More recently--in 1922-the Commiscioner of Banking of liaoonsin
had occasion to protest ~ainst promoters trying to gain control of
banks.
In one case, the
as to pay for the stock out of the assets of the
• method
bank, substituting North Dakota paper for the good Wisconsin
paper which he turned over to the ehareholders in p~ent for
their ahares. • • 11
11
iscons:in
co..-ro-r
L~(TER
ADDRESSED
FEDER AL RE~~R VE BANK OF SANff< A... ~ISCO
TO :
1
0
l
f
COPY OF i:.ETTER
ADDRESSED
fEDER AL
R . . . ~~RVE
BANK OF SANf
.. ~ vlSCO
Oi~i ion of B I l• Op r
TO :
•
*
in ·ts original form
IOI
f·
f'EDER AL RESE RVE BANK OF SANfR A
CISCO
✓ November 28, 1932
Mr. J. H. Riddle,
Secreta ry, Committee on Branch, Group and
Chain Banking,
Federal Reserve Board,
Washington, D. C.
Dear Mr. Riddle:
While I was in Washington you showed
me a letter received from h-. Pierre Jay commending
the reports which you had prepared for the Committee
on Branch, Group and Chain Banking.
If you have no objectio n to sending
me a copy of that letter, I should very much like to
have
t for roy files.
Yours very truly,
Dit~:/C;_,
l◄''EDEPAL PESE RYE BANK OF SANF PANC ISCO
November 28, 1932
Mr. J. F. Riddle ,
Secret ary, Committee on Br nch, Group and
Chain Banking,
Federa l Reserve Board,
Washington, D. C.
Dear h-. Riddle :
lith your letter of Novembe
23d, I
receive d the charts prepare d for the various
studies underta ken by the Committee, and thank
you for your kind attenti on to my reques t.
Yours very truly,
£~
Deputy Governor.
' TELEGRAM
FEDERAL RESERVE SYSTEM
1/
( LEASED WIRE SERVICE)
137 b
Sanfranci sco 904 m Nov 26
Golden,ei ser
ashn
Table 5 page 40 summary report needs correction last two items
last column
See last column table 6 page 42
Clerk
1 "8p
D. 1. IKl'f'U:<f • PT paflifTr.'10 ffrtMI ltU
2--11901
.ov mb r 23, 1932
Cl rk
overnor
~e rve B nk
noi oo, C lit.
r
r. Clerk:
In ooor no
1th your letter
ending you herewith oopie
I
p red tor t
riou
ie
un
ot
rt
ot ove
b r 16th
11th oh rt
n b th co
prei tee.
ry truly your ,
J. H. Ri dle
c
t ry, Co
G oup and C
o.
If H
nch,
TELEGRAM
FEDERAL RESE VE BOARD
WASHINGTON
SRC/CM/
I
I
fEDER AL PESER YE BANI< OF S.\NFR ANCISC O
November 16, 1952
Mr. J. H. Riddle,
Secretary , Committee on Branch, Group and Chain Banking,
Federal Reserve Board,
Washington, D. C.
Dear Mr. Riddle:
Receipt is ackno,led ged of your letter
of November 12th, enclosing final draft of the Committae's Summary Report.
I would very much appreclat e it if you
could have sent to me a copy of each of the charts
used in the reports submitted in the various studies
undertake n by our Committee.
COPY OF LETTER
ADDRESSED
FEDERA L
R
'-.C:RVE BANK OF SAN
f
TO
•
•
•
FEDER AL RESER VE
B .A...~li
OF CLh-vELA .c~
November 15, 1932.
Mr. E. A. Goldenwe iser,
Chairman, Committee on Branch,
Group and Chain Banking,
Federal Reserve Board,
Washington, D. C.
Dear Mr. Goldenwe iser:
Your letter of the 12th
regarding a summary report and recommendations
were eliminate d, as the majority no doubt have
approved the report I see no ~eason why I should
object to having reports showt}
{ my signature .
Very t
MJF:EHG
7r
yours,
J. Fleming,
of Committee.
ERA L RES ERV E BAN K
OF NEW YOR K
ovember 14, 1952.
Mr. J. H. Riddl e, Secre t·ry
Committee on Branc h, Group and Chain Banking
Feder al Reser ve Board
Washington, D. C.
Dear
• Riddl e:
Yours of the 12th lhas been receiv ed this morning
with the two copie s of the final draft of the comm ittee's Summa
ry
Repo rt, for which pleas e accep t thank s.
I feel you are very much to be congr atulat ed on
the excel lent ork done.
You must have spent an excee dingl y busy
few days in whipping this into final shape and gettin g the
job
done on time.
Very truly yours ,
--
Form N o. 131
FEDERAL RESERVE
Offi ce Corr espo n
BOARD
Date_ ... ovember 14,_ 1932
To
From _
and Chain Banking
2-M,05
e PD
I hav
revi
ed the story on gro'J_p and ch in bsnking .
stateme nts mad
hich I believ
are off er d not in a
ork.
The comm~nt
ch nge
The latter I
d.
ll'
vie
Thee
ch n
of i proving the
rv t ions, not specific
ill take up w1 th . r. Bl ttner
you hav_ not time t.o go ov r them.
•
ber of le ding gro
th
roup
A mor
r
re ent ati ve
gro •:o
in e ch o
th 1
the
outh.
that the
am.
1 c io
could
lection
a
inite
11 Sel
lt that t i
ave b en
25,000,0 00 in loan
t least ad
e.
a mol
d
ected" num-
lection
a
25,000,0 00 in loa
thP geogr phi c d visiorw .
than
r
tative of the country
ix be.n."lc
to those
groups
di cussion liinges around
I have contir.u ally
not r pr s
(page 7)
choo
1th
ob
1i st ed b elo
1. The main part of th
i
materia lly alt
piri t cf cri ti.cl m but
or correcti on •
1r ctly i
should b
There o.r
nd inv
by trudn
There er
lim·t d
it i
m nt •
th
m cy repr
lar
entat iv
nd inv stment , u rticul
atem nt shoul
be
ly
ncorpor at d stating
ent rely arbitrar y and that other
ght
other gro
2. The
ntir
th
is is b
ed on "leading group
II
meld
tr
li ttl
or
no mention of th_ minor groups or chains exceptil'lE;...., usp n ions.
Tbr
ter
thy di -
c
d vot d to the holdin
ar
sion o
3.
gai
th
t
th
story
c
it
I believ
a mor
1
chains is due to them.
cont in
t grout> banking and
e
coJit.J rq.
ch p-
ks to ere t
d r p ti tion of th
m'l> ~~
.
could b
eli
am
t d
argu.
nt
·thout d
for or
troying
2
r. Smead -
4. I
th re i
th
tion orofi
for organi
of
re ourc
aft r th
pri
holding
0
li.
th
of
Th
u'bj ct
1
no
e Sy t
fe
,,,..,.w
public
"
r.!
),
p
0
the
0~
e
the Board,
only jeop
~'11'1
~Y to C e t
b
e.
1
d
C
(
r
b n
r
i
bu
j
dsn ero
th
oniz
con rol
und r
PSDY.
1
Tb
-
nt
in DI1Y
cone ntr t
or
s of the b
o
oup
-- of
y group
r operation
po s~bili ty of aim
nl ul tion
pecul tion in --
ed
di c
8
lie tely handled or en ir ly
ould be mor
'lim r.at d.
t.
5er t"h
io
no
er the C d
1 -
s
o
ch
'\.th
n
i
C
d gr atly to infl
b.
t Jr
0
nc
ant r 5 de
goo
i
fi
th
ould 1
for
OT
od
by
?
i
"'ion o.
e
SU
hich v r
the
rouo
It occur
X
t
C
.
it r int nded.
to
i
od pr c
b
cons tr
t
the
u
by th
Co
rti..,
A
in oth r oomoil tio
Do!?'
0
d
'
the
0
0
roup
II
0
top
C
t
any
by "p
ould thi
-
om
I
er to
vi ion~
ion
0
r ntly too
r
not b
t i
ff'P.
co
i
h
q
t
to the di c
th ind vi dual
d
imi
d
p !Il
l'
t
r
li
ct ion by
ar
C
ly
h
o d?
1.
1 i
on t
s
0
1
b
it t
too mu
8
o
mb r 12, 1932
hon
to let u
e t
1th
on it.
V ry truly you
,
• • Golde
• C
Ohai
Ch
and
Group
no.
1 r
itt
noh,
er 2, l 32
·r. L. R.
ound
Gove nor
l Rer.orve B nk
'8
De
r.
Yo k
oun
nol sed are tvo oopiea of the final druft of
he Committee•s
UJJIDSry report.
ery truly yours,
le
·eoret ry, Co
J. H.
ittee
n
Group and Chain B nking.
Eno.
r noh,
1
8
a r
1
t
cc
Ooto er 25, 1932
r. L. R. ound
Deputy Gove
er l
e r
r. Round
1
ree oopie
r ng
of t
oh, Group
t
one of
d
t
tir
n
p
t
0
C
ber l,
it
e
t ten o•olook in
ill
0
r.
Very truly your ,
on
ng.
no. ,:3
nob,
o ob r 2 , l
2
rt
to
po
in
yo
ry t
no ,
no.
:H
cto r 2, 1932
our
~
/ } !r'""~
hi~
~
..
~;a;;_
~¥
-~
~-~-
~~ r ~
r
}v.
••
II
FEDERAL RESERVE BANK
OF CLEVELAND
October 20, 1932.
Mr. J. H. Riddle, Secretary,
Group, Chain & Branch Banking Committee,
Federal Reserve Board,
Washington, D. C.
Dear Mr. Riddle:
I have your te1e~am of the 14th in which you
advise it is planned to have a meeting of the Committee on Tuesday, November 1st. I was away for a few days when your telegram
was received and I have been giving the matter some consideration
since 1II::f return to the office on last Tuesday morning.
As you may know, I am now managing the Cleveland
Agency of the Reconstruction Finance Corporation and have taken
very little time off since assuming duties with the Corporation.
Unless it is absolutely necessary I prefer not to come to Washington for any meetings until after I have been relieved of R.F.C.
work.
Mr. E. A. Carter, of this Bank, has as you know
been very active in accumulating data for use by the Committee in
so far as this district is concemed. He has also been active in
connection with work incidental to the Committee on Bank Reserves.
Inasmuch as Mr. Carter and I are in accord with one anothers ideas,
I was wondering if it would be the proper thing to have Mr. Carter
attend meetings in my stead? I should like to have you discuss this
matter with Dr. Goldenweiser and Mr. Smead and advise me.
Fleming,
MJF:EHG
r of Committee.
For= No.
ta
FEDERAL RESERVE
BOARD
Subject;_ _ __
Dr. Golden eiser
2- 8495
Referrin tot
is quoted belo
telep on re uest made by your office tod~, ther
eting of t_e F deral Re~erve
re olution aaopted at the
dite the s.,e 1 n of ta on br ch,
t 1 bein~ carried on in he oard 1 s
,
ttee of fiv b
int d by
eral A vi ocy
the
e
, to a e ble
inn
iced in the U
s,
h in b
y
evelop d
the United ~t tes
r, t
of thi., and oth r countrie
ect or o
hip
stocks by in
nt tru ts
corpor
, in
h t th
be in pos· on of accurate and aut oritative info
non the ubject".
tin order to ex
t
Bo d m et:ing on
t durin
he
co
ttee t
of
e
cha·
,
t
0
br
oup
e C
co
tte
ich had e
r
erv
ch b
a
in
d have to
itt
to th
ection ith 1
tte
in
United
ive con iderabl
on
oth co
tteei=;
houl
II
the
so appoint th
evelop nt ot
to study the
a co
erve
co
appoint d to
ject of m ber bank re.,erve
t the Board mi ht find it de irable to
·tte
co
th t
orn
dy oft e
make a
a
the
ebruary 26, 1930, Governor oun · ..itat d that
• He .,ta
tat
uld b
em rs
esire to talce
uch
b
·
, he
hip of
t trusts
•
11
ction.
0
prac
de
te
1n
bat,
ch
thou ht to thi
"A
"1.WtJUU
ed
to
rve
r 17 l .32
er co
C
•
.
'::LEG RAM
FEDERA L RESERV E SYSTEM
(LEASED WIRE SERVICE)
RECEIVED AT WASHINGTO N, D. C.
25dea
Clevelan d oct 17 944a
Riddle
ashn
Regret delay answerin g telegram 14. Mr Fleming out of city.
Returnin g latter part of week. He will wire you.
Miss Moulton
10am
D. I
ll'O'l'l'.a'flll ■ 'IT
1'RLNT11'10 o,n..· •
IH
2-lllXll
.
LEGRAM
FED ERA L RES ERV E SYS TEM
(LEASE D WIRE SERVIC E)
RECE IVED AT WASH INGTO N, D.
C.
249p b
San fran cisc o 1114aM Oct lt
Rid ale
Boa rd ~ash n
Your wire 14th nove mbe r firs t for Mee ting bran
ch com r1itt ee
sati ~f~ ctor y plea se asc erta in from smef d whe
ther brun ch and
rese rve conuni ttee or·k c n be con ven ient ly
cor.1pl1;1ted by t .mth
as des ire to be in sanf ranc isco whi le Gov erno
r abs nt n c0n fer, nce
tent ativ vly prop osed for 14th wire ~ep ly prom
ptly as I wish to
mee t with l enze l and
cKay be ore nove mbe r firs t in con nJct ion
ith work of acce pt~n ce com m·tt ~e .
Cler k
232p
0
.. .OYUJUta>t T PtUITO.G e,rt OI
HU
2-11001
9
.. ELEGRAM
FEDE RAL RESER VE SYSTE M
-
-
!)
(LEASED WIRE SERVICE)
??bs
RECEIVE D AT WASHING TON, D. C.
NewYork Oct 15 114
Riddle
Comm ittee Group and Chain
u.m
Bankin g
shingt on
Believ e November 1 will be entire ly satisf actor y
Round s
1144A
D. . . IH)YU'i'MS'IT " ' " " " " ·
orrlc■
1"4
2-11Q01
.....
·,. .
-
-
f8,
tlµ.
~
FED Ei AL l{ES ERY E BAN K OF SAT l◄'PANCI
SC
'I
l '
/
Octo ber 14, 1952
Mr. E. L. Smead,
Chairman, Committee on Bank Rese rves,
Fede ral Rese rve Board ,
Washington, D. c.
Dear r. Smeadi
Response to your lette r of Augua
has been postp oned becau se
I did not wish to inter rupt the time being spen:tt on th
repo rte prepa red on the
subje ct of Branc h, Group and Chain Bank ing, which work
has now been comp leted
with the excep tion of the repo rt recei ved this morn
ing on Group and Chain Bank ing.
The follo wing are comments on the topic s subm itted with
your
lette r of August 11th :
DEPOSITS IN FOREIGN BRANCHES OF AMERICAN BANKS:s
first
As I inter pret 11'1". Wyat t's/pr opos ed amendment
to Secti on 19 (c),
it requ ires that the liab ility shown on the books of
a member bank in the Unite d
State s to a forei gn brmic h of the same bank be treat
ed
non-member bank . This hamo nizas with Secti on 19 (c) A§. tho ~ "due to" a
of
in its prese nt form, and I see no adva nt ge in the chang the Comm ittee' s repo rt
if the term "gros s depo sits" is to be ampl ified in respee recommended. Indee d,
forei gn branc hes, it ould be nece ssary to inclu de refer ct to balan ces due to
dome:.tic branc hes or the omis sion would imply that the ence to balan ces due to
latte r shoul d be treat ed
diffe rentl y from the form er.
The secon d recommendation is that liab
of a forei gn branc h of a member bank are to be treat iliti es shown on the books
ed as thoug h pay blea t a
non-ruember bank . This is a round about way of sayin g
that sometimes a member
bank mq be part member and part non-mo~ber, and
that the part that is non-member
may carry the same reser ve as a non-membe
r bank , the answ er to which is noth in.
My sugg estio n would be to change the prov iso in
Secti on 19 (c) to
red as follo ws:
Prov ided, however, that tae tem Pg!'es e a9JJ ooits "-sh~
net i.Bel~de any liab ility carri ed on th~_QOoks of a
foreign branc h shal l be excl, &ed from ~he comp utatio n of
"gros ~ depo sits."
(See first parag raph page 3 my lette r
Octobs 16, 1931 ).
•
Mr. E.
r..
Smead - - 2
BANK RESERVES
NATIONAL BANK NOTES AS VAULT CASH:
It is realized that the position our Committee has taken in regard
to National bank notes rlll, or at least may, change very materially if the
volume of notes in circulation increases to the maximum now possible, or any
substantial portion thereof.
e have no assurance, however, that such will
9ccur, nor that anything serious will happen if it does.
It seems best to make no change in the Committee's recommendation
as to allowing National bank notes on hand to be included with vs.ult reserves
within the limitations prescribed.
Should a situation be brought about by National bank notes with
which the System cannot cope, the stage will be advantageously set for asking
relief from Congress.
LIMITATION ON CASH IN VAULT:
While it is conceded that banks situated in Federal reserve cities
may not need to carry in their own vaults an amount as great as one-fift.h of their
legal reserves, it is difficult to see hat danger may come from their doing so,
as long as their total reserve re uirements are properly maintained. Of course,
there is the possibility that an increase in the volume of National bank notes
may cause an adverse effect, but it is merely a possibility that the volume will
increase materially and that the effect of such an increase will be detrimental.
This ls a question, however, which can be dealt with by administration or legislation if and when found necessary.
I would be opposed to the Boa.rd being given authority to regulate the
proportion of vault reserves which any specific bank or banks might maintain, first,
because I see no need for such provisions and, seew>nd, because if granted it would
lead to charges of discrimination or favoritism. With rapid means of communication
by highway and air, the problem of banks removed from currency supplies has been
very greatly mollified.
15% MAXIMUM LDTITATION:
In my telegram to you of March 51 1932 1 I expressed a willingness to waive the one seriol.1$ objection to the acceptance of our report in toto
by agreeing to the Board's recommendation that unusually active accounts (Disc01mt
Corporation, for instance) carry 50% reserve on average balences in lieu of
reserves being based on average daily debits.
You will recall that I further suggested that the 50% vault reserve
apply only when all accounts of the same ouataner are treated alike. This was
to prevent the Discount Corporation, for instMce, from maintaining two accounts,
one of which would carry a very small balance through which the great majority
of items would flow, the other being of considerable amount and inactive. To be
extreme, a corporation may maintain a dormant account of $1,000,000 and an active
account of $1,000, and carry a reserve of $50,500 (5% plus 50%). By treating
the accounts alike, 50% flat, the reserve would $500,500.
Quite properly you pointed out that my sugge tion .-as worthless
because the Discount Corporation may carry its active account in one bank and
the inactive account in another. This shows the hopelessness of trying to meet
the situation.
rtd in
Rf-~ours~~ it mi_ght be arr!!!).ged that one whose account is subject
t o 5vp
one I.ICU.IA sha.u. be suoject to bl1,f, in all banks, and those enjoying
...
,
Mr. E. L. Smead - - 5 -
"
BANK RESERVES
this privilege should agree not to carry accounts with non-member banks. The
difficulty of administering such a propo al is apparent.
It is my view that the Committee's plans should stand or fall in the
form originally submitted, and I, therefore, recommend no change to take care
of a situation such as that presented by the Discount Corporation.
VAULT CASH RE~UIREtrnNTS OF BRANCH BANKING SYSTm:
In most cases, one-fifth of the legal reserves of Federal reserve city
unit banks would be much more thsn they require or de ire to carry in their own
vaults. Likewise, offices of branch banks situated in Federal reserve cities
would need less than the one-fifth permitted. By reason of the one-fifth being
more than normally necessary, it makes available a substantial portion of the
Federal reserve city branch banks vault reserve for di.stribution among country
branches. Small branch off ices maintain vecy little cash whenever they are
near important "key" branches. These larger branches act as central points for
outlying offices. In preparing to meet a threatened disturbance in 1928 in
the Bank of Italy National Trust and Savings Association, we shipped currency
to numerous central points, from which the outlying branches would obtain
necessary supplies. This economizes the use of currency and gives mobility.
Because of rapid means of communication, both by highway and air, the
needs for carrying large supplies of vault cash arises only under extraordinary
circumstances.
It does not seem necessary for our Committee to give special
consideration to exceptional possibilities.
From an operating standpoint, it would be exceedingly impracticable
to have a branch bank carry with the Federal Reserve Bank a different proportion
of reserves according to the location of offices. The practical way would be
to classify a bank either as a Federal reserve city bank or as a country bank,
according to the preponderant character of its business.
I can see the possibility of an outlying bank preferring to have
its bead office domiciled in a Federal reserve city in order to have proper
contact with the Federal Reserve Bank, etc. To meet such a situation, I would
be willing to recommend that
a bank having two-thirds of its gross deposits at branches
outside the vicinity of the Federal Reserve Bank or branch thereof
shall maintain not less than two-fifths of its total required
reserves in the form of a reserve balance on deposit with the
Federal Reserve Bank.
GROSS DEPOSITS:
It is believed to be impracticable to construct a sound reserve procedure on the basis of gross deposits alone. This has been explained fulJ.y in
the memorandum for the Governors submitted with Mr. Smead's letter of Janu161 1952, which has rrry approval..
-~
i.
SEPARATE RESERVES ON DEPOSIT IN SAVINGS DEPARTMENTS OF DEPARTMENTAL BANKS:
I am fully in accord with the recommendation contained in Mr. Riefler•s
memo. of August 10, 1952, to the effect that where State laws requj_re segregation
-------7..
Mr. E. L. Smead - -
4
-
of assets of savings and commercial departm ents, separate reserv accounts
shall be maintain ed with the Federal Reserve Bank, each BUbject to penaltie s
for deficien cies even though one account contain s a surplus sufficie nt to offset
the deficien cy in the other.
In the Twelfth Di trict, separate reserve accounts have been maintained for Califor nia and Oregon Ste.ta banka. An~sis is made on the basi
of co bined reserves under order of the Federal Reserve Board.
e in San
Francisc o, ho ever, have felt that the analysi s should be made separate ly and
penaltie s for deficien cies, if any, imposed accordin gly.
There i attached copy of letter addresse d to Governor Meyer under
date of April 19, 1932, hich I wrote for Governor Calkins in reply to
Governor eyer's letter of April 15th presenti ng the case of the Exchange
Trust Company of Boston. There is also enclosed copy of telegram received
from Governor Young on Februar y 17th and our reply of the 18th.
Your very truly,
V~~l
Deputy Governor.
cc. to Dr.
r.
Mr.
11.r.
Goldenw eiser
Round
Fleming
Riefler
FED.L ~ RES P..VE BANK OF SA.."I FRANC! CO
Apri.l 19, 1952
Hon . Lugene Meyer ,
Governor, Feder al Re~erve Bo&rd,
Washington , J . C.
~ear Governor 1eycr:
I am in receip t of your lett r of April 15th ,
encloz ing copy of one d1ted M rch 28 , 1952 , addres sed to tho
p esen aFeder al Re erve Bo rd by on . Gear e H. T nkh ,
tive from Has achus etts .
A copy of the 1 assach usetts Bankln • La is not
availa ble , but I shall procev i on my understancti.ng that a
tate bank , ctoing both a commercial ana a saving s busine ss in
the Stat of tassac huset ts , is reauir ed by StE..te la to keep
the transa ctions of its saving s depart ment separa te and aistinct from the oth r affair s of the corpo rat · on .
It seems to me axiom atic that under these cirassach usetts depart mental banl must meintl :in ith
cumsta nces
the Federa:.:. Reserv e Bank of Bo~ton a sep·ra te rererv ~or its
savin~ s depart ment . Inacmucl as surpl~ s reserv ~ carri din the
bank ' s cor ercial depar t ent cannot be counte d as legal re~0rv s
for the savir.g s depart ment, th Bo"'ton proce. ur , in denyin"' the
bank's ri ht to~ intain n separ t res~rv e accoun t for the savings d p~rt ent , leaves ite rr:. b r with no altern tive but to
th
carry furthe r r erv "', in · ts vaults or els h re , t,o co ply i
the provi ions of tt State lu .
Fro thE ptE.ndpoint oP the u'yst m, it males no
ssachu di. erence het er uh re"'erv funds contri buted by
:Fed r· 1
the
of
,..ett ... ~ t te. bunk ar i.n t o accoun ts on th book"'
:in
ble
Pe~erv e Punk , or in one . All of succ fund, ure avail
0
ro the tundeitb r ca e for the gener al use of the System .
point of tle e be..r b nk, ho ever, the-. Bost.on procca ure im oso"'
a burden of duplic ated r cerves ithout f ordir.i:- additfo nc.1
benef it to -1-,h ':yste •
J number of year ... a o, the Bo ri rule th t , if
Califo rnia dep rt entE.l utate bank ma.int ined on the books of the
Fede..r&l ResLrv Bank sop rte reserv e acco..;nts for it comm crcitl
ana savlr s aepart mcnts , and the co~bin~<l amount thereo f equtll ed
at ler st the · l'T'ount ..;uch bank v10uld be reci.uired to carry on
th bookr of the Feo. r 1 Re...,orvc Bank wo,,.e it not a denar t ontal
bank , no pen·lt y shou.11 be imposed for a defici ency exi tinT in
CalL.o rnia
eithLr depar t -nt . As a r ult of tl.is ruling ,
aunt dth the
(like ise a t assach usett ... ) bank may carry lone an
on.
:Ug n
cy r - - 2
th
s
cl ncy
oth r,
the
tV
'!'he
t
ru
u
1
to
pen lt
erve
bank.
o
ici
y b
Gov
h·
lif
n
no
1
r, re
d
in anot er
reame
fro
r r ply
o
oft e 18th,
Your
( i
)
v ry truly,
Jno. U. C 11•'
OV
R.
C O
Y
F ERJ.L RES RVE BOARL
A HINGTO, D. C.
April 15, 19.:.i2
r. J. 'J. Callins ,
Gov rnor, F aeral Re rve ~ank of San Franci co,
an ranci.co , Califor ni.
Dear
T.
Calkins :
Tnere ic inclosed for your :informa tion a copy
of
lett r adctres~ d to the Bo rd by Hoporuble George H. Tin h
represe ntutive from assachuf -'etts , ith ree rd tote ue tion
hether the Exclange Trust Company of Bo~ton should be per itt d
to maintair . to ~ep'rate re erve bal ces ith th Fed r 1 re rve
bank, 01e for it commerc ial dep rt ent ana one for its s vin s
depart ent.
In view of th
fact that you h~v h·d som e
eri nc
·th this proble , under the Depart ental Bankin La a of the
tatc of Californ ia, I sha la reciate ve-ry uch an expressi on
of your vie,s on the ue t~ n rai~ed by Con resrman Tinlm
nnd
l'"'o
cone s st temcnt of the e eri nc
hic 1 1 the F der 1 Re
B nk of San Franc · sco hash dint · s conn ct· n .
Very truly your
Eugene r eyer
GOV ::RNOR .
Inclosu re
rv
ITT!!J.. ON A.:. PROPRIATIONS
House of Repre µent~t ives
ashing ton, v. C.
r~ rch 28, 1952.
~he Honor ble ~ugene eyer
3overn or, Feder al Re~erve Board
'shinc ton, D. C.
y de- r :r . Peyer:
I hav receiv eJ from th ~xchan e Trust Company of Bo~ton, las aclusc tts, a protes t agains t tre precen t practi ce of t~e Feder al Ref erve Bank o~ Boston with re ard to th' depos
its o~· r serves of m mber
trust companies havin , s·vir.e s dep&rtments.
The Bxchange Tru t Comp£l.Dy writ~s :
11
As the situat ion no, stands , a Tru'°'t Company in r'ass
tts ,
bein~ c member of t~e Fecter al Re~erve System, · s porr·t ted to chusc
c·r
one
accoun t at the Fed ral Reserv e Bank for its Co orcial Departm~nt.
It
is oblige d, ho ever, to carry reserv e c inst its Comrnercitl depos
its
an
lso a ainst its S vings depos its, but the Fecter al P serve BanJ.·
will not &ccept a depo it from the avi.ng" Departr ent . A l c-sacl,
usetts
Tru t Company canno t depo"' it Saving s D partme:.nt money with Commerciul
Dep rtroent money in the same accoun t as that conct itutes an interningli ng of funds prohib ited by assc:.c husetts statut es .
11 e
have been able to find nothin g in the Feder al Reserv e Act
prohi bits a F ocral Reserv e Bank from carryi ng more than one recoun which
a me ber bank , but app rently practi ce has been establ ished proh t with
"bitin g
a second accoun t .
"Why the above st te of affair s exists is beyond my comprehension
.
The ,ay it orks out in our partic ular case - 1e h ve Commercial
aepos its
of round to millio n doll rs ( 2, 000 , 000) and S vings Dep·rt ment
deposit of around nine millio n dollar s ( 9, 000 , 000) . Our Commercial Depar
tment · s re: uired to car a reserv e ag inst the tv,o rnill · on doll
rs
( 2 , OOO , OuO) Commercial money and · so a reserv e agains t the ni_ne
mill "on
rollar " ( 9, 0O0, OUO) Saving s r::oney . This is a hardsh ip din ur
opinio n unre·s onably defe ts one of the urpose s o+> the Feaer al Re
crve
Act .
11 rle have on
.:ie,os it in differ ent Boston b nks today , a roxina tely
two mil ion dolla rs(. 2, 0 o,o D) in carh , belong in to our Saving
Departme nt .
e are unable to use any p rt of this as r serve fund"' and our
cash positi on ctoes not in th least help our re ervc condit ion .
e
lieve no furthe r legisl tion i nee ssary but tJ are fir y convin beced
that there ought to be one or t10 things ha~pen .
(a) A reason able exple. nation of the r fusal of the Feder al
reserv e bank to accep t a second depos it ,
(b) A change in attitu de of th Feder al Re e~vo
Bo rd in ashing t on in re pect to th · , subject matter ."
ill you kindly give this matt r your ttenti un and
ith appre ciatio n of your con"'i derati on , I r emain ,
dvise me?
Sincer ely your ,
(Sgd . )
George H. Tinkham
(TELEGRAM)
9.JLP I
February 17, 1952
To Governor Calkins
fill you please ref er to ru.ling and opinion on page 654 Federal
Reserve Bulletin , July 1919 ith referenc e to deposits with
Federal Reserve Bank from Savings Department of a Trust Company
member bank to count as reserve and auvise me whether your Bank
has ever accepted separate reserve balance from Savings Department of State ~ember Banks and if so what your experien ce of such
sep rate balances has been ana what difficu lties if any have been
encount ered. Please wire.
YOUNG.
February 18, 1932
To Governor Young
Yours seventee nth. Under Californ i law departm ental bank in effect
two separate institut ions under one charter , one engaged in commercial banking and having separate ly proporti oned capital and one engl:..gcd in SE.vings banking business likewise capitali zed. Both departments are required to keep separate books and maint in separate reserves as though two distinc t banking institut ions. On becoming
member Reserve Sy tem compliance ith Systems requirem ents is compliance with State law except that State law does not permit comingl in
of reserve accounts nor use of excess in re~erves of one departm ent
a~ offset to deficien cy in other departm ent.
Board December 10, nineteen twenty ruled ho'j,'ever th t if the sum of
both reserve account s equal total requlrem ents a deficien cy in re erve
account of one departm ent should not be subject to penalty .
e have felt Board's ruling authoriz ing analysis on bac·s aggrega te
sum of both recerve accounts is in conflic t with spir·t Californ ·a
la. Our failure to adhere to departm ental princip le and impose
penalty if depurtm ental requirem ents not maintain ed has rightfu lly
arranted State Ban}·ing Departm ent's dissatis faction . From an operating standpo int the presence of two accounts pre ents no problem particularl y s savings accounts are practic ally dormant . Our advances
invariab ly are to commercial departm ent and consequ ently commercial
re~erve account may be used as offset against discoun ts in event suspension . We now have claim pending against suspended State bank and
intend to use savings departm ent reserve as off et under powers hypothecatio n agreement See reverse side Supplement 5 our Circula r 52.
fuether princip les in ruling you quote ultimat ely will prevail remains
to be te ted by Receive r.
0
CALKINS .
•
•
•
•
1
1
1-
•
1
, w1
•
• l
•
•
-
•
••
8
11
•
s
•
•
l
(
•
•
•
e
Form 148
TELEGRAM
FEDERAL RESERVE BOARD
LEASED WIRE SERVICE
WASHINGTON
2-946'&
••o
FED ERA L RES ERV E BAN K OF SAN FRAN CISC O
'
Ootober 11. 1932.
r. J. H. Riddle.
Seoretary . Colllllittee on Branoh•
Group end Chain Bankin •
Federal Reserve Board.
ashington , D.
Dear
c.
r. Riddle:
Thank you for your letter of October 10 enolosing
a copy of the report on "Group and Chain Banking" as prepared
by the Committe e's staff.
It is rather indefinit e as to
to ex
en I
·11 have time
ine and criticize this volume.
Very truly yours.
F.C
~om::.~
snber. Committee on Branch.
Group e.nd Chain Banking.
fEDEP AL PESE RVE BANK OF SANFP A.TCIS CO
October 11, 1952
Dr. E. A. Golden ei er,
Chairman, Committee on Branch, Group and Chain Banking ,
Federal Re.erve Board,
ashingto n, D. C.
Dear Dr. Golden eiser:
All repost8 submitte d on the subject of
Branch, Group and Chain Banking have been rev-ie ed and
comments fo
ded to you.
ill you please notify me as soon
possibl
hen you expect to call for am eting in
ashingto n.
Yours very truly,
cc. to
~
r. S ead
• Rounds
.r. Fleir.ing
!r. Riddle.
FEDE PAL
p
•
l<..SE I VE
BA
Tl{
OF
s
•
N FI~A NCIS CO
Octob er ll, 1952
Dr. E. P. Golden eiser,
Chairmen, Cotl1Ilittee on Branch , Group and Chain BanJr..ing,
Feder al Reserv e Board ,
ashing ton, D. c.
Dear Dr. Golden eiser:
On November 17, 1951\ I rote sugge sting that
our Co ittee give consid eratio n to maldn a brief resume
of the ba.nJ,-..ing system in Hawaii. As you know, bankin g in
the IslE.D.ds is almos t excl ively comprised of brc.nch
system s.
Alt ough it is fully recogn iz d that the sociolog ical a.nd economic struct ure in th Ha aiian Isl ds
i very differ ent from that on the ·ainla nd, it occurs to
me that our studie s, which have gone far afi ld (Canada
and England) do not embrace ad velopment within the family ,
so to speak.
If there are any conunents you would care to
make on the subje ct, I should be please d to receiv e them.
Yours very truly,
(/jhfl,
/
{/
Deputy Gover nor.
cc. to
• Smead
Mr. Rounds
• Fleming
• Riddle .
-,
fEDER AL RESE RVE BANI{ OF
SA
•
fl ANCIS CO
Octobor ll, 1952
Dr. E. A. Golden eiser,
Chaiman , Co ·ttee on Branch, Group and Cha.in Banking ,
Federal Reserve Boo.rd,
ashingto n, D. c.
Dear Dr. Golden, eiser:
Under date of Novermber 10th, Mr. Riddle fo
rded
a special report covering stati~ti cal data submitte d to the
Sub-Committee of the Committee on Ban1"..ing and Currency of the
Un ted St4tes Senate on November 6, 1951.
I have just completed reading it the second time
and find that followin g my first reading (almost a ye r ago)
I app ently failed to report thereon .
The only ugge tion I have to offer i~ that the
chart and table contain a complete explana tion of the terms
Net Earning s, Net Losse~, etc. For instanc : It is not clear
in Chart No. I on page 94, whether the resul s sho
are before
charg -offs for depreci ation and bad debt or thereaf ter.
It is r comI:lended that all charts and t bles be revie ed and the necessa ry explana tions added.
Yours very t ~ ,
~6/ _e
Deputy Governo r.
cc. to 'lr. Sm ad
Mr. Rounds
• Fleming
M. Riddle.
f
FEDE RAL RESE RVE BANK OF SAN FRANC ISCO
•
COP Y
THE BANK OF CALIFORNIA
Nation 1 Associ ation
00 Califo rnia St.
S J FRAN CI CO,
CALIFORNIA.
S pt ber 21, 195
r . Ir Clerk , D puty- Governor
F d ral
rv
San Franci sc
D
ar
Bank
• Clerk:
R f r ing to your r cent in uiry - the old r cord
Bank
of
Califo rnia disclo
of Th
re olut on at d epte.b er ,
copy
of
ich Is nd ou h rewith . In dditi n to th t,
1864,
of thi bank er uthoriz don th followi ng date:
g nci
York Agency uthoriz ed
Vir ini C ty ~ency author iz d
Gold Hill Ag ncy author iz d
Tr sur City A~ ncy uthoriz ed
Hamilton Ag cy uthoriz d.
July 12,
ept. 6,
e:y
eb.
Feb.
'
9,
9,
ve no tic th t origin ally th Vir inia City a ency
had v ry restric tiv functio n . Eviden tly th se re changed at a
1 t r dat ,
caus
kno - to our re r t - of v r'ou loans that
er ad here .
Yor City ency
i•inall y under
contr ct th L
&
r ho ere appoin
nts w·th po er of
ttorney to
dle bu iness of The Banko
fomi in e York .
Th e g
reed in their
contr ct to handl
1 bankin
functio n
eng
tor ce
its of var
i
and
client .
ori
ap oin
d nots ci
lo s .
e nor cord of th di continu anc of Tr ur
rch 25 ,
Gold Hill gcncy
continu d
con oli
th th busin
of
the Vir 1 City
On
1 , 1884
cy in N Yo
City
d to Laidl
Co pany d sin
t· e thy h
ct d
s one of our
po
ta in that city. On .Tul,_y 9, 1917 th
Vir~~ .~ City
·sconti nu d.
d Hamilton
V ry
(Si
cd)
truly your
th
Stuart F.
Vic
Pr id nt.
~OLUTION PS DAT A
T
ING OF TH BOARD OF DIR CTORS OF
B NK OF CALIFORNIA,
HELD S T .mE
RESOL
:
B k,
conv
SECTI
et b
of Ne
Silve
on
1
recei
rpos
of dv
L
6, 1864.
That t e
b ad ed to the By-Laws of thi
ff ct .uma~L.1..u.tely, and be ct d upon
th all
d, viz:
e
d c
ncy of thi B
City, in the Territor y
on
se
th
rt
in Bullion
d Gold an
of ma.kin dvanc s
or t
purpos of
but not for the
on , unle e by w
o
d Gold
o ·
,
d Si
d ae
d
h
S CTIO 18.
ch Branch or
carried on
er the 'ana
d d by other n c ssary
eral supervis ion
of thi Bank in
Francis co.
ncy a
o a
an ,
ec o
ent
S CTION 19. The
rov 1 of th
of the Br ch or
,
d
pcctiv
shi r, s 11,
s, el ct Gen
City, tog t
tt n 1 tter of
ey shall in like
ov d.
d t
dor
and
ou
t tot
anger
th
ction
r b
almost
vl
bankin
old f
v rt
£inane
st r
ly af
conditions h r
f
an ho
in
on
o
tr
11
ed sho that, in 1851,
o
ed C lifo
h
c
F
d
in
o
ic
th t
ogeth r
freighting bu
0
t
h an
be or an
1852,
d
Co . ,
t
t to
th
id
th
d
fi
t
th
£
in
n
0
1 rJ
1
r bl
In 18 0
e
t bli h d t
fi
t
-
t V r ini
City - here for
v ral y
it h dl d th
tir banki n conne ct d
ith the Co stock and bonan z
inin fortu n s . Anoth r br ch
op ed
t Cr on Cit
t that t
• Both of these branc h
er clos din 1891.
Th
oth r t
City and Por
of
in
1
suppo
d
C
d
ti
Portlm id br
in 1860 or
v
•
1
tage l
s
Both of thes
e
se
F
t
Co . 1
City
1 Bank, th
th
Cn
finan
y
and the
b b
to
11
old
, and Por
int
o.
t S t
th Salt
tho Pony
Apart
f
r
i
;
9/16/ 52
N
York City
Op n
1852
Sold in 190 06 to
N tion
"
Portla nd
II
860
1855
Clo
P rk Bank
d 1891
Sold to U.S. N tio al
Bank in 1906
Salt Lak
City
1860- 61 Sold to
s L
alk r Broth er
C ty, 1905
--- --- Opon
1852
Close1 914
II
1865
18 6 to
8 o.
1852
Cl
owni vill )
ry vill
)
Place rvill )
~onor a
)
utoc· ton
er
to
"
t 150•
At
1 0
0 loc tion
fro
8
un
1
'
r
N
A o t
York
11 F go
toe
ay 20 , 185" .
Co. C
C pi al
co pany. 0
a
•
pres
11 treet .
H
.
i
no
C
bulli
de"'
iddl ,
m-
other
l
.,
Octob r
r
•
ou.n a:
sendin
I
critici
s
re
o. 1932
you
rewi t
cop1 of tbe re ort on
db
t
Co
for e
Grou
in tion
d C in
d
in
I
itt e's st ff.
V ry truly your,
itt
on r
i
nc.
c,
FED ERA L RES ERV E BAN K OF SAN FRAN CISC O
)
fEDER AL RESER VE BANK OF SANfRA NCISCO
•
• •
•
ivis'c.1 o
FEDERAL RESERVE BANK OF SAN FRANCISCO
I
I
o,,l11k
0
0µ rnt1 n~ Vil
•
,
Mr.
1
r. Hor
In
s
tt
cor
nc
r•
r.
th
b
of
i
p
t ti
l
•
:ul
8
l
Gr
11
nthly
on
fro
1 die
n in t
11 b
r 31. 1931.
r
11 t d
0
to
t
Otto
ort
rv
s un
r
i
control
t
of
r.
JJH/fac
1
a -
2
FED ER AL RE SE RV E BA NK OF SAN
FRA NC ISC O
(
11.
•
(C OP Y)
Septem ber 24, 1932
•r. L.
ou.nds
Denuty overno r
ede ra l Reserve Bank
e York, rew York
ear
r. Rounds:
I
the meet ·n
1930,
Gove no
sending you here 1th a copy of the minut s of
of the
nd also
cutive
ommittee held on S pternbe r 19,
copy of the pro res
onferen ce. Seutem
reno rt
tted to th
r 24, 1e O.
Very truly your,
H. Riddle
~ecreta ,, commit tee on Branch ,
Gron and Chan Bankin g.
Enc.
-
ence
To ·
Lir. Smead
--·
FEIJE.RAI, RE.SE.RYE
BOARD
,
Date September 23._l.9.32 _
Subject: _ _
From
• ••
Thia memorandum accompanies the material collected by the committee on the subject of ''Bank Affiliations.''
It includes data on both
non-banking affiliates and banking affiliates.
Poldera 1-9 contain original data ~rnished us by the v riou
Federal reserve banks.
The nine folders represent respectively the nine
geographic divisions used in various sections of the report.
of "Form C" was supposed to be made out tor each affiliation,
One copy
She
names
of the various banks and non-bamdng affiliates concerned being listed.
Each State is by itself with a robber band around the sheets.
our first step in assembling these data waa to make up in
advance from such information as was available here copies of Form C
tor all the affiliations
e kne
of in each State.
Thee were then sub-
mitted to the Federal reserve bank with instructions (which will be men...
tioned later) as to the procedure to be followed in correcting nd amplifying . the information submitted to them.
Some of the banks made out
entirely new torma; other used our original f orms and wrote in the neoes ary changes on the •
When the forms came back to us finally, they
were edited and corrections and coaments made by us will generally be
clearly distinguishable from the original writing.
Folder 10 contains a summary of the infonnation on the C forms
already described.
This awmnary applies only to non-ba:iking affili tea.
2- 8405
Kr. Smead
:tr1z: • Hammond
There will also be found in this same folder copies of the letter of inatruotiona which was sent to the :Federal reserve banks, and in addition,
copies of various memoranda that were used in arranging the study.
This
infonnation also includes explanations of the symbols used in classifying
the various types of affiliations and modes of control.
Folder 11 contains miscellaneous letters and special reports
which ~re sent in by the banks in order to explain more tul ly the descriptions that were put on the o form.
Folder 12 contains some working sheet
th.at were used in making
up summaries of the number of affiliates and of the different kinds of affiliates in different States.
Folder 13 contains working sheet• and summaries of two-bank
affiliates.
These summaries of two-bank affiliates were made up from
the original data on the C to:rm
in folder 9.
Folder 14 contains working sheets that were used in assembling
the figures shown in the sunmar,y in folder 10.
Se
r.
Jed
Sn
te
r 22, 1932
rk
rnor
ne
nk
o, Californi
r :
followi
co
to 7ou t
of
tions
ed re
er d
or
a f
22,
not
ago
aa t
ner in
the report on Brans;
s
incornt
5-7.
n
o
to
d
11 be included.
c
source
lso
rate of
net r turn on not
cl
fift7
• of
3 , Unea 8-21.
u on
t
ra
aaf'ety
inj ct d
ific tion obtain
be included in
r. Pow 11 t
to
no
in
r)
n in titu
id will be
diacuaaio n of
o
11
V ry
O'\i
r 7our
1
you
ruly your,
J.
• Riddl
ecr try, Co
Group nd C
Loe l
rding
o·
1sio, of Ba11k Oper.ati 11s file
-
•
-
•
• • • • •
,
••
i
I
. .
32
-
Form HS
TELEGRAM
F'EDERAL RESERVE BOARD
LEASED WIRE SERVICE
WASHINGTON
r 17, 193
pt
l r •
o
1th
ot
ot
r
t
t
•
o
to
11
tin ot o -
on
FOUR HUNDRED SANSOME STREET
SAN FRANCISCO
September 16, 1952
Dr. E. A. Goldenwe iser,
c/o Federal Reserve Board,
Washingto n, D. C.
Dear Dr. Goldenwe iser:
Branch banking in the United States is a
very commendable contribut ion, but you may not gain
this impressio n from the lengthy comments I have made
on the Report.
Frankly, however, I feel that it needs a
careful revision to eliminate what might be charged as
branch-ba nking propagand a.
I think that if we
state the facts as we find them, the report will speak
for itself.
I feel, also, that it needs a little toning
up, particula rly in the Conclusio n where colloquia l language has been employed.
With kindest regards,
Sincerely ,
u:i
,b,,(e,,
~
- TELEG RAM
FEDERA L RESERV E SYSTEM
(LEASED WIRE SERVICE)
239gb
RECEIVED AT WASHINGTO N, O. C.
Sanfran cisco Sept 16 1039am
Goldenw eiser
ashn
CoI'llllents on branch banking canada england united states complete d
and will be in your hands monday or tuesday do you anticipa te
meeting of committe e sometime during october wire reply
Clerk
150p
11- IJ .OYU:<l' ■ PT J1UJfTD'• OfflCl;J HU
2-11901
FEDE RAL RESE RVE BANI{ OF SAN FRANC ISCO
t
FEDER AL RESER VE BANK OF SAN FRANC ISCO
/
I
,
'
'
6
FEDE RAL RESE RVE BANK OF SAN FRANC ISCO
)
0 er t1on fl
fEDER AL RESE RVE BANK OF SAN FRANC ISCO
'
•
N ol Bank Op( rations f11e
IOI'lll NO. 131
c!)ff. ce Cor resp on enc e
To
From
Mr. Horbet t
Follo
ng ar
ban'
t on the
t
poin
o
A1
ible that som
ole the
in con ection
that occurre n to
c'
in the Unit d Stat s. 11
slo ly, it is
t
f
/\
If I should red th
stion of
de
n the cl pt r (i
rcy mind
~~
h
ourc
f
to me that ther
der
ng stat
crit cl m o
givi g
or i
'or
v r, i
i
1J )
I h d num rou
•
ct , p r i cul
ub j
e
y men th
f.
1. It occur
o
lv s).
this kind would be likely to ar
t ff on the
Commit te '
~
d m tbod of study as b ing plan11ed.
it
ng
t in r
lJ
oo 1 te to make
of the f ct, as you k
t th s tim , in vi
nee
cop
th
tlgge tions o
I think
cy much con ia. ratio 7 tor
any d d sugg st them
hardly to be eY.pected th t
in e.nd
cha.pt r
dequ t ly cov
pecifi c ubj ct. i
11
nu!Ib r an
t r on "Ch
the r ea~on princip ally that it is obviou 1y
~
r 13, 191?__
th a re.th r
other points might occur tom .
chapte r I did not give the q
chang s
~t
Date_
Co_ itte •s
p
in the nurrb er and
i
th Un te._d stat.
dreadi ng of the Comnit t
ize o
BOARD
/ yV
• mea·
burr
FEDERAL RESERVE
all
ta
or
the Comnit
2. Pa
u
3. Chart 7 -
at
hi
t roP to make
olicy
ollo
d
pp n i.x t b
n e.11
slue to somebody t' at cared to
xpa
o check it up .
10, on
3
h
y e.r 18 4 probab ly
hould b
1864 or 1865.
ges
4 - 17, · ndi.c t
th t the fi
of
do not includ
ment. of oour e, i
g
er y
es, it might be of
n line
7
nc
eno
t if
ticular t b
e sources of
P.
no
I m not nr oar
tic .
any u
r
also true of
kno n to almo t e· rybody , p r ap
i vat
or
u ual
r banks out
1
Iey C
itici mi
vings ben
.
this fact
not very impor
Thi
t t -
quit
t.
11
l
Mr . Snead -
2
4. Page 23 -- Ch
t 12, foe year 1930 sho n in the key app rently should
be 1931.
5. page 5b --
Chart
17,
the year 1930 in the
at t~
botto
oft
r ntly should be 1931.
chart ap
6. page bl -- he y ar 1920 in he t t e of t b e 3 I b lie
o
db
1921.
Follo ing
couol
of
H
l.
points noti:-d b
r
Mr. Kenn~d.Y in r
ing th
cha:ot
8
nth s e.go :
I suggest that, in addition to the table of contenta, a very complete
ttee 1 a works)
cross index be prepared for this treatise (as well as for all ,Tt.he c
II
2. I feel that aome consideration should be given the
ch&J'••
&ft
the
advisability of ccmbining the chapter on consolidations with these chapter~&•
consolidations are logically a part of this subject.
3.
(/
As I have suggested to Mr. Hamnond sneral times, I feel the Comni ttee
should have, in their discussion of changes between the state and national
systems, considered the effect of consolidations between the systems, whi.ch I
believe is as good if not a bet t er index than conversions. "
4.
Page 1, line 8, -- "more than a half century," should read "lees•
5. Page 4, last line -- 6,000, I believe should read 6,300
6.
Page 9, line 8 -
1920 should read 1921
7. Page 21, chart 11 -- 1930 should be 1931
8. Page 23, chart 12 - 1930 should be 1931
9. Pe.ge 24, Table 8 -- Oklahoma is shown as one of the 10 atatea with the
smalleat propulation per bank in 1920.
As Miasouri had fewer pe ~~Ee per ba.n1t
in 1920 than did Oklahoma it should therefore be substituted for Oklahoma
Mr.
Smead -
#3.
10. Page 54. Teble 26 -- (a) The ~ r of nation&l. be.nks at
beginning of 1921 ehould be 8,124 instead of 8,123.
(b) Th~e~ ehould
be an explanatory note to cover the difference in the number of national
banks as shown in the tabulation• and ae shown by the Comptroller (Due to
two banks that BUspended in 1930, bu.t which were included in the Comptroller's
December 31. 1930 abstract); (c) The number of suspensions in 1924 should
W'\
read 122 instead of 123 and,.._1925 the m13ber should be ll8 instead of 117.
11. Page 55, Table 27 (a) It would be wall to insert
11 State
8lld.
National in the caption; (b) I suggest that the conversions to private banks
-;
be deducted from co11Versionsfrom private and the net figu11e used.
Column)'
of the ta.bl e purports to show the number of banks permanently discontinued
whereas, in the case of converted banks the~e is diecont1nuance only as far as t
clE..ss is concerned.
\I
12. Page
59 -
The classification
11 Voluntary
liquidation ia qualified
somewhat, and I feel it would be well to add that some of the cases included
as liqu.idati ozisare actually consolidations or conversions as well as suspensions.
13.
Page 77 -
Successions are not taken into account in this study
and should not be given a special heading ( similar to consolidations, sue-
penaions, etc.~ b-&t rather be explained ~ a mem:>randum note.
There ia, it
seems to me, as nuch reason to give a special heading to suspended banks
taken over, reorganizations without change of charter, etc., as there is for
successions.
14. Page 82, Table
n -- 1931
private ban'-':a should be checked and made
to agree with Table 32, page 63.
15. Pages 91 ad!. 99 -- A foot note indicates l national ba.nk in Calif-
Mr. Smead -
14
fornia with capital of $12,000.
A1 $25,000 is the legal re~i irement for
capital of national banks, this mat be a bank with impaired capital, in
which case, I believe, it would be better to leave out the note.
copy of tl-iis letter ·ms sent to the follrnir. -; l!'.
Boston
hilode l ph.'
• tlanta
'1.
vnicngo
vt. Louis
K,'lnsus
... a.r.
t
H ty
rune i sco
p
r l , l
r
V
t
C
ly
our,
B nks:
I
ept mber 12, 1932
k
Ir
or
rve B nk
11 omi
1
r
r. Cl r ,
g to your t
ing tort
nt or oth
ion
tudy
ctually inoorpo
pri t
not
eo
or
to in
11 au
low
,t
tions in your
inaorpor t
ill
not
po
ntion db -
arip , v
in th
, or in
u -
oe.
25, 11
Co
eroi
l
II
t
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l
2
b n
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1 ed, bu your
d
oordin
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rio
5 :
Th point will b
brou
tout
y b en
el t
•
in
0
r. Ir
Cl
~
,
r 12, 1932
ept
2
l
t
tory of ovin
copy, • 89, wt
i
cl
our
pin
o-
ntionin
1
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r.
o h r
10:
t
r1aon of
p
t
176
but
uni
6G to 164 (16
t
xt.
d
oint dot in r vi
OU
b
•
to 163 Of th
st.
17 :
ln
11lal
I
p
rticul rly in
to 1 but
tt
t
w
truly yours,
ltt
on
nkin •
H
noh,
.
ELEG RAM
FEDER AL RESER VE SYSTE M
(LEASED WIRE SERVICE)
RECEIVED AT WASHINGT ON, D. C.
106gb
Sanfrtt rci~co Sept 10 a~6am
Ridale
serve Bo rd lash1ng ton .
Can you forward by air mail comments and change s if any result in
from su estion s cont&in ed my letter u"ust t enty second re branch
bankin 6 in Califo rnia .
Clerk
12llp
I ...... ...an ........ ..._
,...
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1.1111
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litonia, ... Tork, lllichl u, u4 Ohio. •eerl7 halt of 'h• ,ou.1. t.nonue
\he■•
in aalter ot ltraaohe1 11noe h'b1"11U'7 1927, bu ltND repor,e4 tor two ot
s,a,n - lew Tork
u4. C&l tonia.
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!Ito-third■
l'UIOM■,
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ot all \raaohaa in opera,ton on
an4 Ule lDor••• t
year■ ha4 \,
mam'ber of braJlahM of
en larpl7 lD
ottice■
of ,hit
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er of ma ...llllllllU••• DMl'l.7 oae11zlh of 1111 l,ruoh•
la,• eou r, - 510 •• ot 3,547 ottton - be1q,
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of ealler .,.,....
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raoe4 l• 11 178'- ot •r• Uaaa :,0 ,....._, wt :aa MIii
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poaitoraJ
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I
FEDE RAL RES ERV E BAN K
OF CLEV ELAN D
AuguBt 30, 1932.
Mr. J. H. Riddle ,
Secre tary, Committee on Branch,
Group and Chain Banking,
Feder al Reaorve Board,
Wa.shixgton, D. c.
Dear Mr. Riddle :
Thank
you for your letter of August 26 enclos ing
a copy of the report on
"Branoh Banking in Califo rnia" as
prepar ed by the Committee's staff.
'
• Flemin g,
F.C •.MK
r, Committee on Branoh,
Group anl Chain Banking.
I
D
r
r.
ery truly
J•
•
ore
up
no.
our ,
u
r
r.
oun
t 26, l 32
1
tion
o
1o1
oopy ot the
to
i "
p pr d by t
V
n Cl -
po
tt.
Co
rul
our,
on
1n •
na,
u
r
r. Cl
t 26, 19 2
:
ry trul
your,
noh,
no.
t) erat1ons
FEDE RAL RESE RVE BANK OF SAN FRANC ISCO
ile
- -
--
...
-
to "thereby.
•
f B k O1 r tio
FEDE RAL RESE RVE BANK OF SAN FRANC ISCO
fi'n
FEDER AL RESER VE BANK
OF CLEVEL AND
V
August 18. 1932.
Mr. J. H. Riddle,
Secreta ry, Committee on Branch,
Group and Cha.in Banking ,
Federal Reserve Board.
Washington, D. c.
Dear Mr. Riddle:
Your letter of August 17 is at hand, togethe r with
the copy of the report on "Bro.nch Banking in the United States".
I hope to h ve time to review this in the near future.
(.
M. J. Fleming ,
F.C.MK
Member, Corranittee on Branch,
~oup and Chain Banking .
t 17, 1932
AU
• Round
Governor
uty
l
D r
r.
ori i-
I
port
oi
mh
it
truly
in t
nki
t
Unit
f.
ours,
on
n •
no.
noh,
FE DE RA L
••
PE sE 1
BA
•1(
u u t ll
1
vE
oF
.s.\
, -
••
1··I.\ . rCI SC O
v"
r . J . H. Rid ell ,
Se r ta.r y, Co ·tt o
on Bra nch , Group and Chain Ba nki
Fed era l Re rve Bo
n,
,
hin on, D. C.
Dear
to the r
·ctd le:
Re rri n to you r let t r of Au st
4th , in re a
ort on "Branch Bankin in Cal
· for rli • 11
• Dryden h s evl e ed th re ort
an pr p red
en t, ,hic h T have not had
opp
ort
uni
ty
to
red
. A copy
· bin fo ard e , ho eve r, ·th
the und r~t and ing th t I sh l l
r a the cor cnt s a~ soon
po ibl and send you r ina l notat i nr on dup lica te .
I am much
o k of the
spon ·bi liti es hic h hav e
thi s bank for ~an y ont h
h ve ive n lit tl or no t
pre ~si n ana inc apa bl of
· tre "sc d tha t it ha be n n ce
ry
·tte e, but tr ext r ord ina ry r f len u on the sen io of ice rc of
pas t , an which sc
to be
for oth r th ma tt r.
bei n def rr d .
I have been dcv ot·
d ver y c ly
morning to Coilll!U.ttee ork hen notg my eve nin gr
ng
do
n
reg
ul
dut · s .
Act ion on th
re rt , th ref ore , ill not be gre
utl
y
fur the r
pro lon ged unl c"s by int err upt ion
thro ugh a pby ica l bre do •
Yours ve
cc . to Dr .
ise r
tru ly,
iflv~-
FEDER AL RESE RVE BANK
I
OF CLEVEL AND
August 9• 1932•
Mr. J. H. Riddle,
Secreta ry. Committee on Branch•
Group and Chain Banking•
Federal Reserve Board,
Washing ton. D. c.
Dear Mr. Riddle:
Receipt is acknowledged of your letter of
August
5.
togetha- w:i. th a copy of Pert II of a report
on causes of bank failure . end which I hope to be able
to go over at the earlies t opportu nity.
Very truly yours.
F:C:MK
• J. Fleming•
Member, Committee on
Branch. Group and
Chain Banking .
/. I
0
or
0
of b
II
f
rt
ilu
•
,
t
.
u
t
ar
e
n1
you
,
lt
in
, 1932
, 1932
Dr.
r.
teri 1 by
of C
r
i
o d
eon
i dl
hould b
I
ubli h Co
oole to
ul
C
d
b
11 t
it
ru
rio
0
t.
hieh
ro-
tion in dr ftin
ir o
on
to be t r le
Ch
ri 1
hi
i •
in
C
yo
ro
vi
r, I
fi
ill
OU
ri l
ore
Gr ot Co
t e Ch
bl o tion.
V
t
r otioe in
our
to
r
t
i ttin
tt r 1 not
fro
t
inst n
0
ri 1
e
lthou
ort.
our o
ir.olin d to
hold
l
1
ntl
ht
t
p to d
t
t
r.
-
•
FEDER AL P~SER VE IlANK
OF CLEVEL AND
August 2, 19,32.
I
Mr. E. A. Goldenw eiser,
C:t».inne.n, Committee on Branch,
Group and Chain Banking ,
Federal Reserve Boe.rd,
Washing ton, D. c.
Dear r. Goldenw ieers
Your letter of July 27 is at hand, ae are also ttie six
research reports prepared by Mr. Riddle on various phases of the
Committ ee' a investig ation, and ,mich he has to nvarded as tti ey
were complet ed. My time has been taken up by the Reoonet ruotion
Finance Corpora tion to the extent c£ about 100% for many months and,
much as I want to make a c re1\ll study of the reports, there have
been only one or t1IO that I have bean able to do anythmg with at all.
I feel that it would be desirab le to have a meetixg of the
Committee about October 1, as you ere planning , and I would like to
see the prelimin ary dratt of the i:ropoaed committe e report about
Septemb er 15, if possibl e. If I em able to spend any time on the
reports it will be soon ai'ter that date, am it probably 110uld be
better to wait until I have the Committ ee's eummary repcrt before I
begin to review the other reports . I regret that it will be
impoa ible for me to do much in the way of reading or suggesti ng
anything of materia l benefit in the mea.ntime.
The last report which I received , "Causes of Failure ot 120
Represe ntative K ber Banks Suspend ing in the Years 1921-19 30",
contains 10 many 00J:111enta other than absolute facts 'that I doubt the
wiadm of publishi ng it.
'
F.C.MK
M./ J• Fleming ,
~ e r , Committee on Branch,
(J-loup 111d Chain Banking .
Ii/
.-
Form No. 131
Offic e Corre spond ence
••
FEDERAL RESERVE
BOARD
Date August 2, 1932
Dr . Goldemve i_ser
Subject: Use of Co.rn:Jittee material b-=--y_ _
From _:_r . Rid=-d=l=e' - - - - - - -
the Presiden t's Research Committee on
To
/ ..
Social '.:.'rends
I should be inclined to vote against permittin g these
people to publish Co
our own report .
ittee material prior to the appearanc e of
lthough the matter is not a serious one, it
would be a departure from our practice in the past .
You will
recall that we refused the Chamber of Commerce material whioh
they wanted merely for their own informati on in drafting a progr~~ and not for publicati on .
There seems
o be far le&s reason
for letting these people use this material than letting the Chamber have it .
However, I have revised and brought up to date the
figures in c·1se you should feel different ly about the matter .
I.
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value ot the bank upon the purohaae. Preasure is then brought
to•
r payment p these aa each separate cas warrants. It
is very 1eldom that loaaea have occurred unexp otedly du t our
original •ppraiaal.
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•
OF CLEVELAN D
July 50, 1952.
I
Mr. J. H. Riddle,
Secretary, Committee on Branch,
Group and Chain Banking,
Federal Reserve Board,
Washington, D. C.
Dear Sir:
e in receipt, and thank you, for
e
a copy of the re ort prepared by the Committee's staff
on "Causes of Failure of 120 Representat ive Member Banks
Suspending in the Years 1921-1950.
Mr. Fleming, as you probably know, is
stlll connected with the Reconstruct ion Finance Corporation and at present is exceedingly busy and, therefore,
unable to give the report his attention.
When the second part of this study is
received, which you say should be within two or three
weeks, the report can be presented to Mr. Fleming in its
entirety, and perhaps at that time, he wiD have more
leisure to give it proper considerati on.
Yours very truly,
(
0.i~~~
Secretary to
M.
• Fleiing.
FEDERAL RESERVE BANK
OF NEwYoRK
July 29, 1952.
Dr. E. A. Goldenweiser, Chairman
Committee on Branch, Group and Chain Banking
Federal Reserve Board
Washington, D. C.
Dear Dr. Golden eiaer:
Your letter of July 27 i i received outlining the
program for the Committee on Branch, Group and Chain Banking. I
heartily agree with the program you have suggested and believe
we should bend every effort to have the reports completed and
submitted before December 1.
While I have been exceedingly busy in recent weeks
and have not yet gone over the research reports, I shall endeavor
to do so in the immediate future and will let you hear from me as
fast as I can get through them.
Very truly yours,
L. R. Rounds
Deputy Governor
LAL
I
....worzn No. 131
Office Correspon
>
To .-- .1.r_._ $1'.Dead
From
Date
File
J u l ~0~' _1-9~3_2 _ __
ject: Checking of Comnittee 1 s statistics
Mr. Horbet~t _ __
- ~o=f bank ch£Lnges
<tti
...
2-8495
memorandum is being submitted in accordance with the request made
the luncheon conference yesterdey between Messrs. Riddle, Ha~nd,
you and myself.
1
As stated at the conference, the Committee's chapter on bank changes contains, among other things, statistics accounting for changes in the number of
national banks in actual operation during the period January 1, 1921 to
December 31, 1931.
The Committee's classifications of b&nk changes conform
in all essential particulars to the classifications that have been regularly
published in the Board's Annual Reports.
One would be inclined to expect,
therefore, tr.at the Committee's figures rAlating to bank changes, in so far
as national banks are concerned, would agree with the statistics published
in the Board's Annual Reports but, in so far as the period 1921 to 1930 is
concerned, this "111 not quite be the case, for the reason that the Commit tee
took into consideration not only the information that the Board already had
pertaining to eacll change which affected national banks but, in addition,
such other pertinent information as the Committee itself developed in its
studies, and sucll errors in the Board's ste.tistics as we ourselves discover ,d
in preparing schedules covering individual national bank cha,es to support
I
the statistics published in the Boerd's Annual Reports.
The Conm1ttee 1 s staff ha~kept in very close touch with this division
in the preparation of statistics pertaining to national bank changes and I
have every reason to believe that their classification of the changes, on
-
Mr. Smead - #2
the basis of the inform ation that they have, are the same classif ication
s
that
e ourselv es would make at thi
time.
As sts.ted during the course of
the confer ence; there is no differe nce betwee n our definit ions of the
various type of bank chan~c and the Commi ttee's definit ions, in fact
the
Commi ttee's definit ions were prepare d after numero us confere nces betwee
n
Mr. Haranond, myself and other , and they finally were approv ed by you.
Further more, the Commi ttee's definit ions do not differ from the princip
les
we have followe d in the past.
The number of nation al bank changes during
the ten-ye ar period 1921
to 1930 was over 4,000, and if we were to assure ourselv es that the
Commi ttee's stati tics were correc t
e ?.t>uld have to review every one of
the 4,000 schedu les and determ ine whethe r the Committee proper ly classif
ied
~
the cha~ge and proper ly include d,.in the summary statis tics.
A check of
this sort, as you realize , would take a tremend ous amount of time, but
apart from the expend iture of time it would hardly be worth while, in
my
opinion , for I am convinc ed that very fe
differe nces llOuld be found.
I
mey sey, incide ntally, that in the case of the Commi ttee's banksu epensi
on
figures there
ere no more than about a dozen cases mere the Comnit tee•s
stati tics bad to be changed as a result of the checkin g by us of about
9,000 bank suspen sions during the period 1921 to 1931.
The followi ng summery t ble show
in parall el columns the Commi ttee's
figures of nation al bank changes for the ~eriod 1921 to 1931, inclusi
ve,
and the Board' s figures , from which you will see that the differ ncee
are
~~._ (
so small that the_y do not aff ct in any way at all the
change s.
"
II
tory 11 of bank
Mr. Smead - #3
-
-
t~
.I
BoPiFE1 1 e
figures
I 'fZ 1
Number of national banks at beginning o f ~
Increase in number of national banks:
By primary organization
By reopening
By conversion from private banks
By conversion from State charter
By consolidation of State banks
Unclassified
Total increase
Decrease in number of national banks:
By suspension
By consolidation
By voluntary liquidation
By conversion to Stat ba.nkB
Total decrease
Net \Beisaee, er
Net decrease
, ,, s ,
Number of n tional banks at end o f ~
?/ ~ ~
figures
8,124
8,125
854
124
864
115
16
59
537
8
5
1,539
1,581
1,336
1,336
1,647
1,638
127
194
3,295
118
~
23~
3,33
1,756
1,757
6,36g
6,368
-~~f ✓
Under the circumstance' it is my recommendation that we accept the
Committee's figures of bank chenges during the period 1921 to 1930, with
the understanding that ea.ch one is supported by a schedule available in the
Comnittee•e files, so that we can, if necessary, reclassify such change
according to aey desired geogr phic distribution.
In so far as the
figures for the year 1931 are concerned, the figures included in the Committee's report are ours, and
responsibl
e, of course, have checked them
ndare
for them.
The substantially larger nunt>er of conversions sho n by the Board' a
figures is due to the fact that such figures includ so-called temporary
conversions incidental to consolidations. The Commit tee I figure of vonver ion on the 0th r hand nclud only those cases wh r th converted
bank continued in operation under th converted charter, 1 .e., did not proeed to merge i th enot.'1 r bank chartered by the rune upervisory authority.
Jul
27, 193
F0nn
·0.181
Office Correspon
e
FEDERAL RESERVE
BOARD
To
Subject: __
Followin are examoles of the absorpt on by National banks, after
February 25, 1927, of nonmember banks wh ch were operatin head office
city branches established after t e pa1 sa e of the McFadden Act
here
such branches were continued in operation by the national banks:
First National Bank, Jersey City, N.J.
Consolidate d February 18, 1929, ith the Lincoln Trust Company UMer
the charter and title of the Fir t National bank: the national bank bad
three branches and the trust company one branch, all establtahed after
February 25, 1927; these four branches ere reauthorize d by the Comptroller
at the time of consolidati on, just as thou h they had not been in existence at all; in addition, t he Comptroller authorized the establishme nt of
a branch at the location of the former head o fice o the trust company.
Lincoln National Bank, Newark, N.J.
On September 26, 1931, absorbed the Vailsburg Trust Company; the
national bank at that time had 1 b~anch, established November 29, 1930, at
the location of the former head o fice of the Colonial Trust Company,
wh ch consolidate d with the Lincoln Batio~al Bank on the latter date; the
Vailsburg Trust Company also had one branch at the time of its absorption;
established after February 25, 1927; this branch was rea,1thorized by the
Comptroller , just as though ' it had not been in existence at all; in
addition, the Comptroller authorized the establishme nt of a branch at the
location of the former head o fice of the Vailsbur Trust Company.
Hamilton National Bank, Chattanooga , Tenn,
On June 1, 1930, absorbed the Hi land Trust and Savin s Bank; the
National bank at that time wa operating three branches, two of wh ch had
been established prior to February 25, 1927, by- the Hamilton Trust & Saving• BlUlk wh ch consolidate d 1th and became a branch of the Hamilton
National on ebruary 26, 1929; the Highland Trust and Savings Bank, at
the time Jltl'Ps absorbed by the Hamil ton National Bank, had one branch,
establis~ bruary 25,1927; the Comptroller authorized the" stablishmen t"
of th s branch by the Hamilton National Bank, just as though it bad never
been in existence.
J
FEDER AL RESER VE BANI{. OF SAN FRANC ISCO
July 20, 195" •
. J . H. Riddle ,
S cret ry , Committee on Br ch , Group an Chain Bankin ,
Federal Reserve Board ,
a hin ton , D. C.
r
r.
idle :
Recei t
·r
staff on
preprire
eh r
tative
uilure of 1 0 pr
."
th Y rr_, 1921-1950
in
your letter of July 16th .
rli
to
ort
ck.no ledr a of tte r
by 'the Cor:mittce '
Th re rt
irtunity .
Your
1
11
0 u
of
be r v·e d at my
nd-
FED ER AL RE SE RV E BA NK
OF NE WY OR K
July 18, 195 2.
Mr. J. H. Rid dle, Sec reta ry
Committee on Bra nch , Group and Chain Ban
king
Fed eral Res erve Board
1as hing ton, D. C.
Dear Mr. Rid dle:
Yours of the 16t h lis rece ived enc losi ng
copy of the
rep ort on "Causes of Fai lure of 120 Rep
rese ntat ive Member Banks".
I sha ll end eavo r to go ove r this as soon
as pos sibl e and wil l
wri te you rzry comments.
Ver y tru ly you rs,
~
L. R. Rowids
LAL
FEDERA L RESERV E
July 18, 1932
Dr. E. A. Goldenweis r,
tt eon Branch, Group and Ch in Bankin 17 ,
Cha.iman, Co
Federal Reserve Bo rd,
ashington, D. c.
Der Dr. Golden eiser:
With your letter
or
July 15th
Ir
ceived the report on branch banking in California prepared by
r. Gr er.
You will realize, of course, that it
comes at a time when
it will have
my
e are overwhelmed 1th ork, but
attention at the first opportunity .
Yours very truly,
(/A~9eov C':'
Deputy Governor.
F
l •
l
••
•
co.
o
r.
r.
1
1
1 ,
•
o.
, 19 2
t
0
•
•
•
Federal Reserve Committeo on
Branch, Group and Chain Bo.nking
July
9, 1932
SUMMA.RY OF IMPORTANT CHANGES FROM 1914 TO 1932
IN STATE LA.WS RELATING TO BANKS .AND TRUST COMPANIES
State ____ ___
Please give on this schedule importa nt changes,
in regard to the topics specifie d, in the laws relating
to banks and trust compani es.
Include only changes made
since January l, 1914.
It is not necessa ry to give the exact details
of every law bearing on the points enumera ted.
Include,
however , all signific ant changes in the law relating to
the organiz ation of new banks, to limitati ons on the
loans and invostm ents of banks and trust compani es, and
to the trust powers of banking institut ions.
As indicate d in the heading s, specify whether
the change applies only to banks, only to trust compani es,
or to both banks and trust compani es.
Do not include
changes which apply only to mutual savings broiks.
- 2 -
1-a. - Changes in the ca.pi tn.l required 1Q. organize commercial banks and
stoek s~.vings bo.nks
j
Dn.te
of cl1n.na:c ,
I
I
I
Former provision
New provision
- 31-b. - Changes in the capital roquired for banks _}.Q_ exercise trust powm. s
Date
1
of cnan..,.e!
Forme r provision
No.; provision
- 4-
1-c. - Changes in the capital required to organize trust companies
Date
of cha
t
c;
Former provision
Now provision
- 5-
1-d, - Changes in the capital recruirod for trust compnnies to ong::i.ge
in bo.rJ-d. n,c,:
Do.te
of cno,n,.ge
i
!
Former provision
Nor; provisio21
- 6-
2. - Ch.::mges in the discretionary porrer·s of supervising authorities in the
granting of rn charters to bunks and trust compnnios
Date
of chn.n
1
0 •
Former provision
He·.-1 provision
- 73-a. - Changes in the limitations
.Q.n loans to single borroners :!2.;L commercial
banks and stock savings banks
D::i.te
of cr1an e
Former provision
Nc\1 provision
-
3-b. - Changes in the limi tntions
Date
of chru e
I
.Q.!?:.
Former provision
8 -
loans .iQ. single borr0\10rs
pru.ies
EL trust com-
New provision
- 9.Q1! lonns iQ. office rs and dircct_ors £X commercil'.l bo.nks nnd stock snvim;s -onnl::s
4-a. - Changes in the limi t[',tions
Former provision
Ne yr provision
- 10 -
4-b. - Changes in the limitations
Date
l
of chanP-:ei
loans to officers and directors ~ trust
companies
.Q.!1
New provision
Former provision
j
I
I
II
I
I
li
I
I
I
I
'
I
II
I
-
11 -
5-a. - Changes in the ].imitations on real estate loans
}2x stock suvinf.:.: s banks
Date
of change
I
I
Former provision
~
comrrej~cial ba.nks and
Ne·1v provision
- 12 -
5--b. - Changes in the limitations Q!! _!!lal estate loans
Date
of chan e
Former provision
~
trust companies
New provision
- 13 6-a. - Changes in other limitations on loans El corn.nercial and stock savinf,s banks
E.g. Limitations on the total aiilQunt of loans
Limitations on tne total amount of unsecured loans
Limitations on the total amount of loans secured by warehouse
receipts
Linli tat ions on the total amount of loans on securities
Limitations on loans secured by ovm stock
etc.
Date
of change
Former provision
I
I
New provision
- 14 -
6-b. - Changes in otncr limitations on loans
E.g~-. Limitations on
Limita tions on
Limitations on
by ware11ouse
Limitati ons on
Limitations on
e tc.
Date
of chan«e
the total a,nount
t he total amount
tho total a!ilOunt
receipts
the total amount
loans sectu od -oy
Former provision
k;y trust companies
of loans
of unsecured loans
of loans securod
of loans on securiti e s
own stock
New provision
- 15 7-a. - Chapges in liini tations .Qn the oTTnCl sh~..E of real estato }?x. comnerc ial
and stock sa.vin.e;s b:c'.nks
Date
j
of changej
Former provisio n
Nc\1
I
I
I
• II
I
i
!
I
I
I
I
i
j
pro\ isi0n
..
- 16 7-b. - Changes in limitations
Do.te
of chant;e
Q.n
the ownership of real estate }?x trust companies
Former provision
new provision
..
- 17 8-a. - Changes in limitations g_g investments of commercial and stock ~yings banks
( Include all changes in limitations on investments, except (a) o,vnership of real estate, (b) ownership of stock in Federal Reserve Bank,
(c) ownership of corporate stocks)
Date
of chane:o
Former provision
Ne,;, provision
.
'
- 18 8-b. - Changes in limitations on investments of trust companies
( Include all changes in limitations on investments,
except (a) o\'mcrship of real estntc, (b) ownership
of stock in Federal Reserve Bank, (c) ownership of
corporate stocks!)
Date
of chan,,e
Former provision
Now provision
I
'
- 19 -
9. -
Changes in the trust po11ers permitted to commercial and stock savings banks
Date
of chanB.'.e
Formor provision
New provision
- 20 -
••
10. - Chan{;es in tho bruiking po•,10r s of trust companies
Date
1
of change!
Former provision
Nmv provision
Jtornl. No. t:ll
FEl)ERAL RFSERVE
BOARD
Subject:
l
-Date_
J
3
C
7, 12 ;;
Ii'OrD\ No. Jal
Office Correspc de
To
r.
ol enweiser
fr.1 r(.dle
From
(.
e
FEDERAL R£.5£RVE
BOARD
Subject:
~ ate.
~ 30, 1932
nnual lea,e allowance to me -
bars of tho staff
·•·
•
In view of the provisions of the conomy Bi 11 just passed by
Congress oga:rding annual leave and in view of tho co ittee's generou
treatment of the staff re arding leave allowance in the past, I suggest
that be inning tomorro , July 1, 1932, no further nrmu. 1 leave allowance
~i th pay should be granted to the r.:i.embers of the staff . This, of course,
should not affect their accu:nulated and unused allovance at pre ent . If
this eats ith your a proval, I shall notify the .embers of tne staff
accordingly .
~
L
g,
.
~..
-·
I orm • ·o. 131
f·EO£RAI. RESERVE
Offi ce Correspon
To
From
BOARD
Dr. Goldenwe ser
Date_ J_u_l~_
Subject: _ _ _ __
r. Riddle _ _ _ _ __
The expendi tures of the Comnitte e on Branch, Group and Chain
Banking from
pril 16 to June 30, 1932, aggrega ted
13,184, di trib-
uted as fo llowa s
Salarie s
ent
Travel
All other
Total
The item of travel,
fornia from the end of
13,183.6 8
531.10, covers Mr. Greer's trip to Cali-
arch till the middle of 8¥ in connect ion with
the study of branch bankin
in that
fUrther travel expendi tures on
11
10,273.0 0
325.00
531.10
2,054.58
tete.
,e do not anticipa te aey
ccount of the Commit tee's staff.
,.
The item all other includes a payment of
piece of
the Co
ork hich
1,722 for a
peoial
as nearly co~plete d by April 15th and for which
ittee of course was already c~'lllilitt ed.
The total expendi tures of the Committee from its beginnin g to
June 30, 1932, aggrega ted 121,247 .83, distribu ted as follows:
ataries
Rent
Travel
All other
Total
98,219.3 1
2,728.75
3,445.08
16,854.6 9
121,247 .83
June 28, 19~2 .
J.H. Rid dle, Ee.
See. Com. Bran ch Bnn king ,
Fed eral Res erve Boa rd,
YI ehin gton , D.C .
Dea r Mr. Ridd les
The paee ge
you refe r to on p.20!5
of MBanking Reform" ie in Cha pter
XII , and waa pre-
par d, if my memory eerv ea me cor rect ly,
by Mr. H.
Park er
iili •, und er my dire ctio n. He is now
on the
N•• Jour n,il of Commerce.
He may be able to find the
mat eri l for you.
Very trul y you re,
J-~~=
e 27, 1932
r . Horb tt
r . Riddle
I
·tte
on B.r
y nr 192
fort
1th the fo lo in
Peop ea B n
or t
that b
Oft
UB
1th
he e r port
a.ne ~ru. t Co
ny of ,liz
t
e
h 1930
e l uding
,
•
hich a
lab
por
,
s
fort
not on our list •
tio
1 Bn
l
in-
turn a. to . our office tod.o.yi
ir t ·ere
eth,
tion-
ugust 15, 1930; the 1930 repo t for th
a,
por
e rec·- d no
exc ptio
id not b co e
·
ioh you
ports
office fort
C in B
ch, Group
the 1· t req est d
ition
from to Co ptroll r •
od enou,h to bo.ro
Co
1th t e co
he
ret min
o
tt •
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✓
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✓
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✓
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✓
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,
J.
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no,
1vl
r.
ic
r.
in
0
t
ort
t t
t • •
1i
cc Dr. Ool en eiser
r • .,.nsad
lf
l h it .
0
co )Y of this letter wa
ent to a 1 l _ ••• banks except G1 velani.
une l , 19 2
r
r.
.
0
• t
nd l
t
ly
OU
,
0 •
.r . Riddle ,
The relativPly greater growth in rPcent yearn of state
bank ,·esources as co11.pared with na.tionol bank resources is concen-trated wholly vri thin the banko reported by the Comptroller of the
Currency as loan and trust comu nias ~l"'bout 1500 in nur-:ber) . In
fa.ct , the State ( comr_1Prcia.l) banks and stock s vings banks ( nbout
'3 , 000 in numbor in 1920 and 1~ , 000 in 19: 1) have ::;hmil1 h rdly any
grm;th at all .
Since the "loan and trust comna.nios" are thus the only group
a.moni; the State banks whicl1 a.ro growinr, more rr idl: · han the national
banks , it is highly desirable that we k.11ow
st what is the difference
bPtwe,m these ....nd tl1A Sta.tA (com:inrcial) banks .
r . Kano , of fue
st tistical division of the Corlptroller ' s office , tells me that he
knows nothing o.t all about the classification , sinc"' it is all made
at the various utRtP. banking dt:.part :Pnts .
nu
In view of thi.; situation , could an inq liry be sent to the
respective state bankin deuo.rtmPnts , askinf:; the basts of the cl ssii'ication o state cha.rtPred ban·rn into state ( colil! 0 rcial banks. and
loo.
n.'.'.ld ➔ rust cmpanies .
list of the st tes which T1ake the distinction is given below 1 arrange by Federnl Ri?serve Districts .
I
District Jo . 1
Jaine
11
Hllill'"IShirA
VAnnont
l•assa.cl1•Jsett s
Cor.'1r,cticut
"Rhode Isl•nd
District ·o . 2
District
Tev, ,JArsoy
PAnnsylvania
elawa.re
District .ro . 5
7
Indi na
Io·:
'icr1iv,an
isconsi
Di strict No . 8
pi::;souri
N0w York
District No . 3
No .
District No . 9
• innesotrt
Jorth D kot
Sou-c;h Dakota
District No . 10
Kans s
Colorado
l arylnnd
District
o . 11
Dist ict No . 6
exico
l ew
Fl r ida
Di"trict No . 12
Utah
• evada.
fashingt on
Oregon
California
•
Forn:i No. 181
ffice Corresponde
To_
Dr. Goldenw iser
From
Mr-. ~u.rton
e
FEDERAL RESERVE
BOARD
• lne.
Date_
g
Subject:_
.,.
I am returning
r. Cnase 1 s pap r, together with comment
by
Mr. Hammond and m;yself.
I have not at t mpted general criticism s of the character and
organizat ion of Mr. Chase's statement , since I em not in a position to
do that adequatel y until I have completed
my
work on Mr. Lauck•s study.
The comments I have made have been confined to the accuracy of the factual material in Mr. Chase's statement .
2 -8405
FEDE RAL RESE RVE BANK OF SAN FRAN CISCO
J
'
n
C
o r ,
...
.... .
'
'
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r
tl
r
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0.L
t,
r port
tJ.e
n
.EXCERPT
FRO
THE
NUT-
0~
FEDERAL RESERVE BOARD 1
-·
June 6., 1932
Reference was then made to memoranda dated May 23, 1932, from Mr.
Goldenweiser., as Chairman of the Committee on
Banking o
he Federal Reserve System, and
System Committee on
Branch, Group and Chain
• Smead, as Chairmnn of the
ember Bank Reserves, submitted at the request of
Miller, in connection with the budgets of the Federal reserve banks for
statistical and analytical work for the year 1932.
• Smead' s men:orandum
reported. that the expenses of h.:.s committee have amounted to
22,591.22 to
date and that there wi 1 be no further expenditures except those required.
to print the statistical tabulations and studies which were undertaken in
the course of the committee's investigations.
• Goldenweiser's memorandum
outlined. the activities of, and work done by, his committee since its
organization and reported that the expenses of the committee to April 15,
1932, amounted to $108,000, and that it is estilnated that expenditures from
April 15 to t he end of
the oommittoe's work \'tiich will be completed between
October and the end of 1932, will amount to about
36.,000, exclusive of
costs which may be incurred in printing the committee's report.
• Miller
expressed the opinion that whatevor value the oolllIJlittee's report might have
iould not justify the expense involved..
He stated that, in his opinion,
the necessary studies could have been completed before no, at a much smaller
oost, had the soope of the committee's activities been more definitely
planned at the inception of its investigation, which was initiated in the
Spring of 1930.
• Goldenweiser stated that the personnal of the committee
was the same as that of the System Committee on
ember Bank Reserves, th t
it had not been practicable for them with their other duties to give much
individual time to the work and that in view of the wide scope of the
subjects to be covered it had been neoessacy to employ a number of people
for a considerable length of time.
He added that, while it might be
June 6 1 1932
-·
(Continued)
-
·possible to reduoe the proposed future expenditures somewhat, an arbitrary
reduotion might mean the elimination of certain data whioh would be vecy
valuable in the completed report.
Action was deferred on the matter.
tt
I
r
r
at.
1
0
11 t o
r
th r
tb
port
r c iv
b
1 h
t
nt
t
Jul.7 1, 19 5
J
24, 1922
1 1, 1924
~. 1922
24, 1922
24, 922
24, 922
2
T'
July
1
1922
24, 1922
ry 25, 192
19,
26
l 1
l
1902
..,_..U.l'J "'Jf I
1931
7, 1931
3,
JE/! ac
n ,
t
thl1
r -
t
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ne 1, 19 2
Dr. Gold n
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iddle
I h 1ve
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1
fi tll
ith thee c
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t
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itte
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Buildin g
102
that floor seemed to be bett r
i
at ff of th Co
el cted for t
81
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r
oor •
t
our of
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ce
Thi
tion of
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rran ment on
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o 1 t
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n
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urn
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I could
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