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FE D E R A L R E S E R V E BANK
OF NEW YORK
rCircular No. 3 3 0 3 T
L January 23, 1948 J

SUPPLEMENT TO REGULATION D
Reserves Required To Be Maintained By Member Banks
With Federal Reserve Banks
Increase Effective February 27, 1948
To all Member Banks in the
Second Federal Beserve District:

Enclosed is a printed copy of a supplement to Regulation D, “ Reserves of
Member Banks” , adopted by the Board of Governors of the Federal Reserve System
to supersede the existing supplement to Regulation D and to become effective at
the opening of business on February 27, 1948.
The Board’s press statement for immediate release regarding this action is as
follows:
As a step towards restraining further inflationary expansion of bank credit, the Board
of Governors today increased from 20 to 22 per cent of net demand deposits the amount of
reserves required to be maintained with Federal Reserve Banks by central reserve city mem­
ber banks. This action is to become effective Friday, February 27,1948.
The effect of this increase will be to raise the required reserves of central reserve city
banks in New York City by about 420 million dollars and those in Chicago by nearly 100
million dollars. The present required reserves for these banks amount to about 4,300 million
and 1,000 million dollars, respectively.
Under the provisions of section 19 of the Federal Reserve Act, the Board of Governors
has authority to establish reserve requirements for the various classes of member banks
within the following limits:
Minimum

A gainst net demand deposits

Central reserve city banks.................... .....................................................
Reserve city banks................................. .....................................................
Country b an k s....................................... .....................................................

Maximum

13
10
7

26
20
14

3

6

Against time deposits

All classes of banks................................. .....................................................

Reserve requirements are now at the maximum limits in all cases except for net demand
deposits at central reserve city banks, which, after the present increase becomes effective,
will be 4 points less than the maximum under existing authority.

Additional copies of this circular and of the enclosed supplement will be furnished
upon request.




A

llan

S proul,

President.

SUPPLEMENT TO REGULATION D
ISSUED BY THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM

Effective as to each member bank at the opening of
business on February 27, 1948

RESERVES REQUIRED TO BE
M AINTAINED B Y MEMBER BANKS
W IT H FEDERAL RESERVE BANKS
Pursuant to the provisions of section 19 of the Federal Reserve Act
and section 2(a ) of its Regulation D, the Board of Governors of the
Federal Reserve System hereby prescribes the following reserve bal­
ances which each member bank of the Federal Reserve System is
required to maintain on deposit with the Federal Reserve Bank of its
district:
6 per cent of its time deposits plus—
14 per cent of its net demand deposits if not in a reserve or cen­
tral reserve city;
20 per cent of its net demand deposits if in a reserve city, except
as to any bank located in an outlying district of a reserve city or in
territory added to such city by the extension of the city’s corporate
limits, which, by the affirmative vote of five members of the Board of
Governors of the Federal Reserve System, is permitted to maintain
14 per cent reserves against its net demand deposits;
22 per cent of its net demand deposits if located in a central
reserve city, except as to any bank located in an outlying district of
a central reserve city or in territory added to such city by the exten­
sion of the city’s corporate limits, which, by the affirmative vote of
five members of the Board of Governors of the Federal Reserve
System, is permitted to maintain 14 per cent or 20 per cent reserves
against its net demand deposits.





Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102