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F ederal R eserve Bank

Dallas, Texas, October 3, 1962


To All Banks in the
Eleventh Federal Reserve District:

For your information, there is quoted below a press statement issued by the Board of Governors
o f the Federal Reserve System in connection with the transfer of authority to regulate the exercise
o f trust powers:
“ Authority to regulate the exercise of trust powers by national banks was transferred
from the Board of Governors of the Federal Reserve System to the Comptroller of the
Currency on Friday, September 28, when the President signed Public Law No. 87-722.
“ The signing of this law marks the successful culmination of several years’ effort,
supported by the Federal Reserve System, to simplify the supervisory responsibilities
relating to trust activities of national banks. Since national banks are supervised in other
respects by the Comptroller of the Currency, it was logical that the regulation of their
authority to act as trustees should also rest with that office.
“ With the passage o f Public Law No. 87-722, the authority of the Federal Reserve
Board, first, to permit national banks to operate trust departments and, second, to issue
regulations governing the operations of trust departments of national banks automatically
terminated. This authority, along with supervision of national banks’ trust departments,
will be exercised by the Comptroller of the Currency.
“ State-chartered banks are also affected to some degree by this new legislation. All
banks operating common trust funds will hereafter be required to comply with regulations
issued by the Comptroller of the Currency rather than the Federal Reserve Board if they
wish to qualify for certain tax exemptions applicable to the operation of common trust
“ The transfer of authority became effective immediately upon the signing of the Act,
and pending applications by national banks for authority to exercise trust powers will be
acted upon by the Office o f the Comptroller.
“ It is understood that the Comptroller of the Currency on September 29 issued a new
regulation (which replaces the Board’s Regulation F — “ Trust Powers of National Banks” )
to implement the Comptroller’s new authority.”
Yours very truly,
Watrous H. Irons


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