Full text of District Notices (Federal Reserve Bank of Dallas) : Amendments to Rules Regarding Delegation of Authority, Circular No. 75-12

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F ederal r eser ve b a n k o f Dallas

DALLAS. TEXAS 75222

C i r c u l a r No. 75-12
J a n u a r y 14, 1975

AMENDMENTS TO RULES REGARDING
DELEGATION OF AUTHORITY

TO ALL BANKS, BANK HOLDING COMPANIES, AND OTHERS
CONCERNED IN THE ELEVENTH FEDERAL RESERVE DISTRICT:

Effective D ecem ber 30, 1974, the Board of G o v e rn o rs of the
F ed eral R e s e r v e Syste m h a s a m e n d ed its Rule s R e g a rd i n g Delegation of
A u tho rity to t r a n s f e r c e r ta i n d e le g ate d a u th o rity from the R e s e r v e B an k s
a n d d e s i g n a t e d Board m em b ers to the S e c r e t a r y of the B oard of G o v e rn o rs
of the Federal R e s e r v e S y s te m .
T h e am endm ents a r e e n clo se d in s lip - s h e e t form fo r in s e r tio n
into the R egulations b i n d e r .
S in c e re ly y o u r s ,
T . W. Pla nt
F i r s t Vice P r e s i d e n t

E n c lo s u re s

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM

RULES REGARDING DELEGATION OF AUTHORITY

Effective D ecem ber 30, 1974, section 265.1a
is am ended by striking o ut all of paragraph (a)
thereof, and by striking out “ (b) T h e Com m ittee
on Organization, Com pensation, and Building Plans,
consisting of three members of the B oard” in
paragraph (b ) thereof and inserting in lieu thereof
“T he C om m ittee on Federal Reserve B ank Activi­
ties, consisting of at least three members of the
Board” and by striking clause (ii) of subparagraph
(1 ) thereof, and inserting in lieu thereof “ (ii) in
connection with year-end salary reviews, the salary
of any officer of a Federal Reserve Bank at the
level of Senior Vice President (Salary G rou p A ) ,
excluding the M anager of the System O pen M arket
account and the Special M anager fo r Foreign C u r­
rency O perations for such Account, and the salary
of any G eneral A uditor of a Federal Reserve
B ank.” As so amended, § 265.1a reads as follows:
S EC T IO N 265.1a — S P E C IF IC F U N C T IO N S
D E L E G A T E D TO BO A RD M E M B ER S

G rade 16 of such salary structure for each R e­
serve Bank o r branch, and (iii) the paym ent of
salary to any such employee in excess of the
m axim um o r below the m inim um fo r the grade
in which the em ployee’s position is classified.
(3 ) T o approve (i) am endm ents to the autho­
rization from the Board o f G overnors to the F ed­
eral Reserve Banks fo r the paym ent o f separation
allowances upon the involuntary term ination of
em ploym ent o f any officer or employee of a
F ederal Reserve Bank o r branch and (ii) paym ent
of such a separation allowance to any officer of
a Reserve B ank or branch.
(4 ) T o approve the paym ent of salary to any
officer (o th er than the President o r F irst Vice
President) o r employee of a F ederal Reserve
Bank whose services are retained fo r m ore than
90 days after attainm ent o f norm al retirem ent age.

(5 ) T o approve am endm ents to the Guidelines
and Objectives for H ealth Insurance prescribed by
(a)
The Committee on Federal Reserve Bank the Board of G overnors for officers and employees
of Federal Reserve Banks and their branches. In
Activities, consisting of at least three members of
the exercise of any authority delegated und er this
the Board designated by the Chairman, is autho­
paragraph ( a ) , the C om m ittee shall be guided
rized, pursuant to the twenty-second paragraph
by the objectives o f prom oting the efficiency of
of section 4 o f the Federal Reserve A ct (12
Reserve Bank operations and of m aintaining the
U.S.C. 307) and subject to such general guide­
morale of Reserve Bank personnel and shall give
lines as m ay be prescribed by the Board:
appropriate attention to salary levels and em ploy­
(1) T o approve (i) changes in the salary
ment practices in the relevant com m unity but
structure fo r officers, other than the President and
with due regard to the public character of the
First Vice President, of each Federal Reserve
F ederal Reserve System.
B ank and branch thereof, and (ii) in connection
with year-end salary reviews, the salary of any
* * * * *
officer of a Federal Reserve Bank at the level of
Senior Vice President (Salary G rou p A ) , exclud­
Effective D ecem ber 30, 1974, section 2 6 5 .2(a)
ing the M anager o f the System O pen M arket
is am ended by changing the com m a following
A ccount and the Special M anager fo r Foreign
“authorized” to a colon, by making a new sub­
C urrency O perations for such A ccount, and the
paragraph (1 ) out of that p art of paragraph (a)
salary of any G eneral A uditor of a F ederal R e­
beginning with the w ord “under”, and by adding
serve Bank.
new subparagraphs ( 2 ) , ( 3 ) , ( 4 ) , ( 5 ) , ( 6 ) , ( 7 ) ,
( 8 ) , ( 9 ) , ( 1 0 ), (1 1 ), and (1 2 ) to read as follows:
(2) T o approve (i) changes in m axim um and
m inimum salaries for the respective grades of the
salary structure for nonofficial employees of each
S E C T IO N 265.2 — S P E C IF IC F U N C T IO N S
F ederal Reserve Bank and branch thereof, (ii)
D E L E G A T E D TO B O A R D E M P L O Y E E S
an increase in the special m axim um salary for
A N D T O F E D E R A L R E S E R V E BA N K S

(a)
T h e Secretary of the B oard (or, in his
absence, the Acting Secretary) is authorized:
(1 ) U n d er the provisions of P a rt 261 of this
chapter, to m ake available, up o n request, infor­
m ation in the records of the Board.
(2 ) U n d er the provisions o f section 3 ( a ) ( 1 )
of the B ank Holding C om pany A ct (12 U.S.C.
1842), to approve the form ation of a bank hold­
ing com pany through the acquisition by a com ­
pany of a controlling interest in the voting shares
of one o r more banks, if all of the following
conditions are met:
(i) the Reserve Bank could approve such
form ation under subparagraph (22 ) of paragraph
(f) of this section, except for the fact th a t con­
dition (iv) of that subparagraph has not been
m et because one of the following policy issues
has been raised with respect to such form ation:

m et because one of the following policy issues
has been raised with respect to such acquisition:
(a) a director or senior officer of the holding
company, of any subsidiary bank of the holding
com pany or of any bank sought to be acquired,
is a director of a Federal Reserve Bank or
branch.
(b) a director or senior officer of the holding
com pany of any subsidiary bank of the holding
com pany o r of any bank sought to be acquired,
is a m em ber of the Federal Advisory Council.
(c) the Board has m ade a general determ i­
nation that another policy issue raised by the
proposal does not require Board consideration,
but nevertheless makes it inappropriate for a
Reserve Bank to approve the proposal.
(ii)
all relevant divisions of the B oard’s staff
recom m end approval.

(a ) a director o r senior officer of a bank
which w ould becom e a subsidiary of the hold­
ing com pany proposed to be form ed o r a
director or senior officer of the holding com ­
pany proposed to be form ed, is a director of a
Federal Reserve Bank o r branch.

(4 ) U n d er the provisions of section 18(c) of
the F ederal Deposit Insurance A ct (1 2 U.S.C.
1 8 2 8 ( c ) ), to approve a merger, consolidation,
acquisition of assets or assumption of liabilities,
where the resulting b ank is a State m em ber bank,
if all of the following conditions are met:

(b ) a director o r senior officer of a bank
which would becom e a subsidiary of the holding
com pany proposed to be formed, o r a director
or senior officer of the holding com pany p ro ­
posed to be formed, is a m em ber of the Federal
Advisory Council.

(i) the Reserve Bank could approve such
merger, consolidation, acquisition of assets or as­
sumption of liabilities under subparagraph (28)
of paragraph (f) of this section, except for the
fact that condition (iv) of that subparagraph has
not been met because one of the following policy
issues has been raised with respect to such trans­
action:

(c ) an individual (o r group of individuals)
who is a principal in the holding com pany
proposed to be form ed is already a principal
in another bank holding company.
(d ) the Board has m ade a general determ ina­
tion that another policy issue raised by the
proposal does not require B oard consideration,
but nevertheless makes it inappropriate for a
Reserve Bank to approve the proposal.
(ii) all relevant divisions of the B oard’s staff
recom m end approval.
(3 ) U n d er the provisions of section 3 ( a ) ( 3 )
of the Bank Holding C om pany A ct (12 U.S.C.
1 8 4 2), to approve the acquisition by a bank hold­
ing com pany of a controlling interest in the voting
shares of an additional bank, if all of the follow­
ing conditions are met:

(a) a director or senior officer o f any bank
involved in such transaction is a director of a
Federal Reserve Bank or branch.
(b ) a director or senior officer of any bank
involved in such transaction is a m em ber of the
Federal Advisory Council.
(c) the Board has made a general determ i­
nation that another policy issue raised by the
proposal does not require Board consideration,
but nevertheless makes it inappropriate for a
Reserve Bank to approve the proposal.
(ii) all relevant divisions of the B oard’s staff
recommend approval.

(5) U n der the provisions of section 3 ( a ) ( 5 )
of the Bank Holding Com pany A ct (1 2 U.S.C.
(i)
the Reserve Bank could approve such 1842), to approve the merger or consolidation of
a bank holding com pany with any other bank
acquisition under subparagraph (24 ) of p ara­
holding company, if all of the following condi­
graph (f) of this section, except fo r the fact that
tions are met:
condition (iv) of th a t subparagraph has not been

(i) the Reserve Bank could approve such
merger or consolidation under subparagraph (30)
of paragraph (f) of this section, except fo r the
fact that condition (iv) of that subparagraph has
not been met because one of the following policy
issues has been raised with respect to such merger
or consolidation:
(a) a director or senior officer of any of the
holding companies or of any of the subsidiary
banks of the holding companies involved in
such m erger o r consolidation is a director of a
Federal Reserve Bank or branch.
(b) a director or senior officer of any of the
holding companies o r of any of the subsidiary
banks of the holding companies involved in
such m erger or consolidation is a m em ber of
the Federal A dvisory Council.
(c) the Board has m ade a general determ ina­
tion that another policy issue raised by the
proposal does not require Board consideration,
but nevertheless m akes it inappropriate for a
Reserve Bank to approve the proposal.

nation that another policy issue raised by the
proposal does not require B oard consideration,
but nevertheless makes it inappropriate fo r a
Reserve Bank to approve the proposal.
(ii)
all relevant divisions of the B oard’s staff
recom m end approval.
(7 ) U n der the provisions of section 4 ( c ) ( 8 )
of the Bank Holding C om pany A ct (12 U.S.C.
1 8 4 3 ( c ) ( 8 ) ) and section 2 2 5 .4 (a ) (9 ) (iii) (a ) of
Regulation Y (12 C F R 2 2 5 .4 (a ) (9) (iii) ( a ) ) to
approve the acquisition or, as an incident to a bank
holding com pany form ation pursu ant to section
3 ( a ) ( 1 ) of the Act, the retention by a bank
holding com pany of shares or assets of a com pany
that acts as insurance agent or b rok er in offices
at which the holding com pany or its subsidiaries
are otherwise engaged in business (or in an office
adjacent thereto) with respect to any insurance
sold in a com m unity that has a population not
exceeding 5,000, if all of the following conditions
are met:

(i) the Reserve Bank could approve such ac­
quisition o r retention u nd er subparagraph (32)
(ii) all relevant divisions of the B oard’s staff
o f paragraph ( f) of this section, except fo r the
recom m end approval.
fact that condition (iv) of th a t subparagraph has
(6 )
U n der the provisions of section 4 ( c ) ( 8 ) not been met because one of the following policy
issues has been raised with respect to such acquisi­
of the Bank Holding C om pany A ct (12 U.S.C.
tion o r retention:
1 8 4 3 ( c ) (8 ) and sections 2 2 5.4 (a) ( 1 ) , ( 2 ) , (3)
and (9 ) (ii) of Regulation Y (12 C F R 2 25 .4 (a)
( 1 ) , ( 2 ) , (3 ) and (9) ( i i ) ) to approve the acquisi­
tion by a b ank holding com pany of an interest in
a finance com pany or an industrial bank, as such
term s are respectively defined in subparagraph
(31) of paragraph (f) of this section, w hether by
acquisition of shares o r assets, if all of the follow­
ing conditions are met:
(i) the Reserve Bank could approve such ac­
quisition u n der subparagraph (31) of paragraph
(f) of this section, except for the fact that con­
dition (v) of that subparagraph has not been
m et because one of the following policy issues
has been raised with respect to such acquisition:
(a) a director or senoir officer of the holding
com pany, of any subsidiary bank of the holding
com pany or of the finance com pany or indus­
trial bank to be acquired is a director of a
Federal Reserve Bank o r branch.
(b ) a director or senior officer of the holding
company, of any subsidiary bank of the holding
com pany or of the finance com pany or indus­
trial bank to be acquired is a m em ber of the
Federal A dvisory Council.
(c) the Board has m ade a general determi­

(a) a director o r senior officer of the holding
com pany, of any subsidiary bank o f the holding
com pany or of the com pany to be acquired or
retained, is a director of a Federal Reserve
Bank o r branch.
(b ) a director or senior officer of the holding
company, of any subsidiary bank of the holding
com pany or of the com pany to be acquired
o r retained, is a m em ber of the Federal A d­
visory Council.
(c) the B oard has made a general determ i­
nation that another policy issue raised by the
proposal does not require Board consideration,
but nevertheless makes it inappropriate for a
Reserve Bank to approve the proposal.
(ii) all relevant divisions of the B oard’s staff
recom m end approval.
(8 ) U n d er the provisions o f sections 25 and
2 5 (a ) of the Federal Reserve A ct and P arts 211
and 213 of this chapter (Regulations K and M ) ,
to approve the establishment, directly or indirectly,
of a foreign branch o r agency by a m em ber bank
o r corporation organized un der section 2 5 (a ) (an
“ Edge” corporation) o r operating u nd er an agree­
m ent with the Board pu rsu an t to section 25 (an

“A greem ent” corporation) w hich has already
established, o r has been authorized to establish,
branches in two o r m ore foreign countries, if all
of the following conditions are met:
(i) the appropriate Reserve Bank recommends
approval.
(ii) all relevant divisions of the B oard’s staff
recom m end approval.
(iii) no significant policy issue is raised by the
proposal as to which the Board has not expressed
its view.
(9 ) U n d er the provisions of sections 25 and
2 5 (a ) of the Federal Reserve A ct and P arts 211
and 213 of this chapter (Regulations K and M ) ,
to grant specific consent to the acquisition, either
directly o r indirectly, by a m em ber bank or an
Edge o r A greem ent corporation of stock of (1) a
com pany chartered und er the laws of a foreign
country o r (ii) a com pany chartered under the
laws of a State of the U nited States th at is
organized and operated for the purpose of financ­
ing exports from the U nited States, and to approve
any such acquisition th a t m ay exceed the lim ita­
tions in section 2 5 (a ) of the F ederal Reserve A ct
based on such a corporation’s capital and surplus,
if all of the following conditions are m et:
( a ) the appropriate Reserve B ank recom ­
mends approval.
(b ) all relevant divisions of the B oard’s staff
recom m end approval.
(c) no significant policy issue is raised by
the proposal as to which the B oard has not
expressed its view.
(d ) such acquisition does not result, either
directly or indirectly, in the acquisition by such
b ank or corporation of effective control of any
such com pany (oth er than a com pany p erfo rm ­
ing nominee, fiduciary, o r other banking ser­
vices incidental to the activities o f a foreign
b ran ch o r affiliate of such b ank o r co rp o ratio n ).
(1 0 ) U n d er the provisions of section 25 and
2 5 (a ) of the Federal Reserve A ct and P arts 211
and 213 of this chapter (Regulations K and M),
to perm it an Edge or A greem ent corporation to
exceed the limitations in § 211.9(b) and (c) of
this chapter (Regulation K ) , 1 if all of the follow­
ing conditions are m et:
1 Subject, o f course, to the lim itations in section 2 5 (a ) relat­
ing to aggregate liabilities outstanding on debentures, bonds,
and promissory notes.

(i) the appropriate Reserve B ank recommends
approval.
(ii) all relevant divisions of the B oard’s staff
recom m end approval.
(iii) no significant policy issue is raised by the
proposal as to which the Board has not expressed
its view.
(11)
U nd er sections 25 and 2 5 (a ) of the
F ederal Reserve A ct and P arts 211 and 213 of
this chapter (Regulations K and M ) , to approve,
under section 211.4 of this chap ter (Regulation
K ) , the issuance by an Edge o r Agreem ent
corporation o r a subsidiary thereof of debentures,
bonds, promissory notes (w ith a m aturity of m ore
than one y ea r), or sim ilar obligations, if all of the
following conditions are met:
(i) the appropriate Reserve Bank recom m ends
approval.
(ii) all relevant divisions of the B oard’s staff
recom m end approval.
(iii) no significant policy issue is raised by the
proposal as to which the Board has not expressed
its view.
(1 2)
U n d er the provisions of section 4 ( c ) (13)
of the Bank Holding C om pany A ct (1 2 U.S.C.
1843), and section 2 2 5 .4 (f) of P art 225 of this
chapter (Regulation Y ) , to grant specific consent
to the ownership o r control, either directly or
indirectly, by a bank holding com pany of voting
shares of a com pany chartered under the laws of
a foreign country, if all of the following conditions
are met:
(a) the appropriate Reserve Bank recom ­
mends approval.
(b) all relevant divisions of the B oard’s staff
recom m end approval.
(c) no significant policy issue is raised by
the proposal as to which the Board has not
expressed its view.
(d ) such acquisition does not result, either
directly or indirectly, in the acquisition by such
bank holding com pany of control o f any such
com pany (other than a com pany perform ing
nominee, fiduciary, or other banking services
incidental to the activities of a direct or indirect
foreign subsidiary of such corporation).