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fed eral R eserve b a n k of Da llas D A L L A S 13, T E X A S Dallas, Texas, March 29, 1949 SUPPLEMENT TO REGULATION U To All Banking Institutions in the Eleventh Federal Reserve District: There is reproduced on the reverse side of this letter a supplement to Regulation U, issued by the Board o f Governors o f the Federal R e serve System, effective March 30, 1949, which reduces margin require ments to 50 per cent. In connection with this action and a corresponding amendment to Regulation T, there is quoted below a press statement issued by the Board for release today. “ The Board o f Governors o f the Federal Reserve System, effec tive Wednesday, March 30, 1949, amended its Regulation T ‘Extension and Maintenance o f Credit by Brokers, Dealers, and Members o f National Securities Exchanges’ and its Regulation U ‘Loans by Banks for the Purpose o f Purchasing or Carrying Stocks Registered on a National Securities Exchange’ so as to reduce the margin requirements for purchasing registered securi ties from 75 per cent to 50 per cent. These requirements are applicable both to purchases o f securities and to short sales. The Board’s action was taken under its statutory responsibilities and in the light o f the general credit situation.” Member banks are requested to file this supplement in ring binders containing copies o f the regulations o f the Board o f Governors of the Federal Reserve System and the bulletins o f this bank. Yours very truly, R. R. G IL B E R T President This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) SUPPLEMENT TO REGULATION U ISSUED BY THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM Effective March 30, 1949 For the purpose o f Section 1 of Regulation U , the maximum loan value o f any stock, whether or not registered on a national securities exchange, shall be 50 per cent of its current market value, as determined by any reasonable method. SUPPLEMENT TO REGULATION T I ssued by th e B oard of G overnors of t h e F ederal R eserve System Ef f e c t i v e March 30 , 1949 Maximum l o a n v a lu e f o r g e n e r a l a cco u n ts . — The maximum l o a n v a l u e o f a r e g i s t e r e d s e c u r i t y ( o t h e r th a n an e x e m p te d s e c u r i t y ) i n a g e n e r a l a c c o u n t , s u b j e c t t o s e c t i o n 3 o f R e g u l a t i o n T, s h a l l be 50 p er c e n t o f i t s cu rren t market va lu e. Margin r e q u i r e d f o r s h o r t s a l e s in g e n e r a l a c c o u n t s . — The amount t o be i n c lu d e d in the a d ju s t e d d e b i t b a la n ce o f a g e n e r a l a cco u n t, pursuant to s e c t i o n 3 (d ,)(3 ) o f R e g u l a t i o n T, as m a rgin r e q u i r e d f o r s h o r t s a l e s o f s e c u r i t i e s ( o t h e r than exempted s e c u r i t i e s ) s h a l l be 50 p e r c e n t o f the c u r r e n t market v a l u e o f e a c h su ch secu rity.
