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Minutes for
To:
Members of the Board
Prom:
Office Of the Secretary
April 17, 1963
Attached is a copy of the minutes of the
Board of Governors of the Federal Reserve System on
the above date.
It is not proposed to include a statement
With respect to any of the entries in this set of
minutes in the record of policy actions required to
be maintained pursuant to section 10 of the Federal
Reserve Act.
Should you have any question with regard to
the minutes, it will be appreciated if you will advise
the Secretary's Office. Otherwise, please initial
below. If you were present at the meeting, your
initials will indicate approval of the minutes. If
You were not present, your initials will indicate
only that you have seen the minutes.
Chin. Martin
Gov. Mills
Gov. Robertson
Gov. Balderston
Gov. Shepardson
Gov. King
Gov. Mitchell
oil4
Minutes of the Board of Governors of the Federal Reserve
SYstem on Wednesday, April 17, 1963.
Roca
The Board met in the Board
at 10:00 a.m.
PRESENT: Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Martin, Chairman
Balderston, Vice Chairman
Mills
Robertson
Shepardson
King
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Discount rates.
Sherman, Secretary
Kenyon, Assistant Secretary
Cardon, Legislative Counsel
Hackley, General Counsel
Solomon, Director, Division of
Examinations
Johnson, Director, Division of
Personnel Administration
Koch, Associate Director, Division
of Research and Statistics
Solomon, Associate Adviser, Division
of Research and Statistics
Sammons, Adviser, Division of
International Finance
Goodman, Assistant Director,
Division of Examinations
Leavitt, Assistant Director,
Division of Examinations
Mattras, General Assistant, Office
of the Secretary
Young, Senior Attorney, Legal
Division
The establishment without change by the Federal
Reserve Bank of Boston on April 15, 1963, of the rates on discounts and
4dvances in its existing schedule was approved unanimously, with the
4/Iderstanding that appropriate advice would be sent to that Bank.
Circulated or distributed items.
The following items, copies of
are attached to these minutes under the respective item numbers
irldicated, were approved unanimously:
E
4/17/63
-2Item No.
Letter to Bank of America, New York, New York, granting
consent to the purchase of additional shares of Pakistan
Industrial Credit and Investment Corporation, Karachi,
Pakistan.
Letter to Chemical International Finance, Ltd., New York,
New York, granting consent to the acquisition of shares
Of Union Financiere pour la Vente a Credit, Paris, France.
2
Letter to Farmers & Merchants Bank of Sebewaing Mich.,
Sebewaing, Michigan, approving the establishment of a
branch in Owendale.
3
Letter to Peoples Trust & Savings Bank, Green Bay, Wisconsin,
;Proving the establishment of a branch in the vicinity of
4shington and Walnut Streets.
4
tter to Cudahy Marine Bank, Cudahy, Wisconsin, approving
he establishment of a branch in the vicinity of Layton and
ackard Streets.
5
Letter to Fidelity State Bank, Topeka, Kansas, approving the
establishment of a branch at 901 Topeka Boulevard.
emorandum from Mr. Sammons, Adviser, Division of International
inance, dated April 15, 1963, regarding proposed foreign
,
'ravel for Mr. Maroni, Senior Economist in that Division.
6
7
Mr. Goodman then withdrew from the meeting.
Report on competitive factors (Canton-Heuvelton, New York).
There
11401 been distributed a draft of report to the Comptroller of the Currency
0n the competitive factors involved in the proposed merger of The First
Lawrence
144ti°nal Bank of Heuvelton, Heuvelton, New York, into The St.
C°411tY National Bank, Canton, New York.
transAfter discussion, the report was approved unanimously for
to the Comptroller with the understanding that the conclusion
/c)111d be revised to read as follows:
V.
F
; 4)1 L.'
-3-
4/17/63
The proposed merger of The First National Bank of
Heuvelton into The St. Lawrence County National Bank
Would eliminate an alternative banking source for
persons residing in the area between Canton and Ogdensburg.
However, there appears to be little competition between
the two institutions, and the merger would not result in
the elimination of significant competition nor in the loss
of any banking outlets.
This transaction would not add substantially to the
resulting bank's present resources, nor would it adversely
affect the competitive force of other banks competing
either with the Heuvelton bank or with the resulting bank's
present offices.
Statement on H. R. 5130.
There had been distributed under date of
APril 16, 1963, a draft of statement to be presented by Governor Balderston
before the House Banking and Currency Committee on April 25, 1963, with
lesPect to H. R. 5130, a bill which would increase the insurance limit
'
tz°m $10,000 to $25,000 on bank deposits and savings and loan shares.
The
statement
would express the view that the proposed increase in coverage
4't this time would not be in the public interest.
The draft statement contained two alternative sections in the
"ncluding portion.
One would cite the report of the Committee on
hnancial Institutions, which recommended that an increase in insurance
coverage await the adoption of a number of improvements and reforms,
41.1c1 Mould state that the Board supported this position. The other
41ternative would cell attention to the effect of such legislation on
"mPetitive relationships among various financial institutions, and
/1°41d point out that it was a proper goal of public policy to avoid
clistortions of competitive relations that would cause funds to flow
,
4/17/63
-4-
away from most efficient uses.
It would urge that legislation affecting
competitive relationships not be approached on a piecemeal basis.
A
araft of an additional possible approach was distributed at this meeting.
After an extensive discussion, there was a consensus that the
Points outlined in the alternatives could be best developed orally, to
the extent necessary.
A number of other suggestions for changes in the draft statement
e'lso were made, tending generally in the direction of brevity.
With
regard to the basic position that would be expressed in the statement,
Chairman Martin inquired whether there was any member of the Board who
cillestioned expressing the view that the proposed increase in insurance
e°verage at this time would not be in the public interest, and no member
so indicated.
Accordingly, it was understood that a revised draft of statement,
reflecting the several suggestions made during the discussion at this meeting,
'
4°111d be prepared.
All members of the staff then withdrew except Messrs. Sherman,
1CenYon, and Johnson.
Appointments at Cleveland Bank (Item No.
8).
By letter dated
41.11 11, 1963, Chairman Hall of the Federal Reserve Bank of Cleveland
4dvised that the Board of Directors of the Bank had appointed W. Braddock
Rickman
Y
Senior Vice President, as President of the Bank effective May 1,
1963, for the remainder of the five-year term ending February 28, 1966.
The approval of the Board of Governors was requested, along with approval
4/17/63
-5-
the payment of salary to Mr. Hickman effective May 1, 1963, at the
rate of $35,000 per annum.
As President of the Bank, Mr. Hickman would
succeed Wilbur D. Fulton, who was retiring at the end of April.
A
Memorandum from the Division of Personnel Administration dated April 16,
1963, which had been distributed to the Board, presented certain inforMation in amplification of that contained in Chairman Hall's letter.
After discussion, the appointment of Mr. Hickman was approved
lulanimously, together with payment of salary to him for the period May 1,
1963, through December 31, 1963, at the rate of $35,000 per annum.
In the same letter, Chairman Hall advised that the directors of
the Bank had appointed Maurice Mann, currently Senior Monetary Economist,
to the position of Vice President in charge of the research function
effective May 1, 1963, with salary at the rate of $18,000 per annum.
%royal of the payment of salary to Mr. Mann at that rate was requested.
memorandum from the Division of Personnel Administration recommended
ts.vorably.
After discussion, the payment of salary to Mr. Mann as Vice President
In charge of research at the rate of $18,000 per annum for the period
MaY. 1, 1963, through December 31, 1963, was approved unanimously.
A copy of the letter sent to Chairman Hall advising him of the
foregoing actions is attached to these minutes as Item No.
Nomination for award.
8.
Chairman Martin recalled that there had
ll'eviously been informal discussion by the Board of the proposed nomination
r mr. Young, Adviser to the Board and Director, Division of International
3
-6-
4/17/63
Pinance,
to receive a Rockefeller Public Service Award.
He noted, as a
Matter of information, that material in support of the nomination had
now been prepared for transmittal.
Personnel question at Minneapolis Bank.
Chairman Martin referred
to a discussion with President Leming of the Minneapolis Reserve Bank
concerning the possibility of the Bank's retaining as an economic adviser,
°II a part-Lime basis, a member of the faculty of the University of Minnesota.
The question had been presented by President Deming at this stage
to obtain some general indication as to whether the Board would see any
fluldaraental objection in principle to such an arrangement.
After discussion, during which it was pointed out that certain
qUestions might arise depending on whatever specific arrangements were
Proposed if the matter were pursued, it was understood that Chairman
Martin would indicate to President Deming that the Board would not object
in
Principle if the Bank wished to explore the possibility further.
The meeting then adjourned.
Secretary's Notes: Later in the day a
memorandum dated April 17, 1963, was
received by Chairman Martin from Chairman
Heller of the Council of Economic Advisers
with regard to the cost of printing the
report of the Committee on Financial Institutions. The memorandum stated that the
fixed costs of printing the report were
estimated at about $1,100, with an additional
charge of approximately $250 for each thousand
copies. Noting that Chairman Martin was one
of the 11 members of the Committee, Mr. Heller
inquired whether the Board would be willing
to contribute $100 toward the payment of the
250
4/17/63
-7fixed printing costs; orders for copies of
the report would be charged at the approximate rate of $250 per thousand. A check by
the Secretary with the available members of
the Board indicated that there would be no
objection to the payment of the requested
amount toward the printing of the report,
and Chairman Heller was advised accordingly.
On April 16, 1963, Governor Shepardson approved
on behalf of the Board the recommendation
contained in a memorandum dated April 12,
1963, from the Division of Personnel Administration that a secretarial training program
for members of the staff of the Board be
conducted as an activity of the Board's Employee
Training and Development Program and that a
letter be sent to the Katharine Gibbs Consulting
Service, New York, New York, confirming the
arrangements to conduct such a program on April 23
and 30, 1963, with the understanding that all
required materials would be provided by the Service
and that the Board would pay a fee of $400, plus
actual travel expenses, at the completion of the
program.
Pursuant to recommendations contained in memoranda
from appropriate individuals concerned, Governor
Shepardson today approved on behalf of the Board
the following actions relating to the Board's
staff:
Fired B. Ruckdeschel as Economist, Division of International Finance,
11-th basic annual salary at the rate of $6,900, effective the date of
en
trance upon duty.
-91,
11t_5jde business activity
Abner Thompson, Multilith Operator, Division of Administrative
07rvices, to work part-time as an offset press operator for Darcel
'
l'aPhic Arts, Inc.
Item No.
BOARD OF GOVERNORS
1
14117/63
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
April 17, 1963
Bank of America,
41 Broad
Street,
New York 15, New York.
Ge
ntlemen:
In accordance with the request contained in your
letter of March 7, 1963, transmitted through the Federal Reserve
,./1 11k of New York, and on the basis of the information furnished,
the Board of Governors grants consent for Bank of America to
Purchase and hold 17,360 ordinary shares, par value Rupees 10
each, of Pakistan Industrial Credit and Investment Corporation
ljr:PICIC"), Karachi, Pakistan, at a cost of approximately
'
c440,830.72, provided such stock is acquired within one year
krOrn
the date of this letter.
The Board's consent is granted subject to the same
nditions prescribed in the Board's letter of April 20, 1961,
granting consent to the purchase of additional shares of PICIC.
CO
Very truly yours,
(Signed) Kenneth A. Kenyon
Kenneth A. Kenyon,
Alsistant Secretary.
4)r 1)
BOARD OF GOVERNORS
40011044
Item No. 2
4/17/63
OF THE
04°
,10CO COk *0
4 Vir
. .........s.
FEDERAL RESERVE SYSTEM
A ZI
• tr
WASHINGTON 25, D. C.
*
*
0
44V,
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
414tat
April 17, 1963
Canileinical International Finance, Ltd.,
bi!virle Street,
e- lork
2 New York.
Qelltlernen:
In accordance with the request and on the basis of the information
ed in your letter of April 3, 1963, transmitted through the Federal
Oh
Bank of New York, the Board of Governors grants its consent for
- c_n
al- International Finance, Ltd. ("CIF"), to acquire and hold shares of
1141.,
0"
'einanciere pour la Vente a Credit, Paris,France ("UNIFIVAC"), in exSocir for its present holding of 8,000 shares of CREDIMA (Credit Malakoff
N25t, Anonyme), Paris, France, and payment in the amount of approximately
,
.°° (equivalent), provided such stock is acquired within one year from
the clikJ
of this letter.
The Board's consent is granted upon condition that CIF shall dispose
its Ii
u
the
of stock of UNIFIVAC, as promptly as practicable, in the event
or diuNIFIVAC should at any time (1) engage in issuing, underwriting, selling
bilai48tributing securities in the United States; (2) engage in the general
ees of buying or selling goods, wares, merchandise, or commodities in the
lirlite,
iticifik States or transact any business in the United States except such as is
oelltal to its international or foreign business; or (3) otherwise conduct
c4tIePerations in a manner which, in the judgment of the Board of Governors,
Nyifsi ttle continued holding of its stock by CIF to be inappropriate under the
844)116 of Section 25(a) of the Federal Reserve Act or regulations thereunder.
Ot
tailkot Please advise the Board of Governors, through the Federal Reserve
0,
. New York, when the acquisition of stock has been made and the corporate
-Rtriz
qdiaa
--, completed, furnishing (1) current balance sheets of UNIFIVAC and subes; (2) brief description of the stock acquired; (3) lists of directors
e'(1
4th) -riciPal officers (with the address and principal business affiliation of
ielb
rind of all stockholders holding 10 per cent or more of any class of
'
ita
im.iiitpxi
' -,`_°6 stock (and the amount held by each), and (4) information concerning
and privileges of the various classes of stock outstanding.
Very truly yours,
(Signed) Kenneth A. Kenyon
Kenneth A. Kenyon,
Assistant Secretary.
253
BOARD OF GOVERNORS
Item No. 3
OF THE
FEDERAL RESERVE SYSTEM
4/17/63
WASHINGTON 25. D. C.
ADORES!! °maim. OORREOPONOILHOIE
TO THE BOARD
April 17, 1963
Board of Directors,
Farmers & Merchants Bank of
Sebewaing Mich.,
Sebewaing, Michigan.
Gentlemen:
The Board of Governors of the Federal Reserve System
approves the establishment by Farmers & Merchants Bank of
Sebewaing Mich., Sebewaing, Michigan, of a branch at
7253 Main Street, Owendale, Michigan, provided the branch
is established within six months from the date of this letter.
Very truly yours.
(Signed) Kenneth A. Kenyon
Kenneth A. Kenyon,
Assistant Secretary.
(The letter to the Reserve Bank stated that the Board also
had approved a six-month extension of the period allowed
to establish the branch; and that if an extension should
be requested, the procedure prescribed in the Board's letter
of November 9, 1962 (S-1846), should be followed.)
r;4
BOARD OF GOVERNORS
Item No. 4
4/17/63
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
April 17, 1963
Board of Directors,
Peoples Trust & Savings Bank,
Green Bay, Wisconsin.
Gentlemen:
The Board of Governors of the Federal Reserve
System approves the establishment by Peoples Trust and
Savings Bank, Green Bay, Wisconsin, of an in-town branch
in the vicinity of the intersection of Washington and
Walnut Streets, Green Bay, Wisconsin, provided the branch
is established within six months from the date of this
letter.
Very truly yours,
(Signed) Kenneth A. Kenyon
Kenneth A. Kenyon,
Assistant Secretary.
(The letter to the Reserve Bank stated that the Board also
had approved a six-month extension of the period allowed
to establish the branch; and that if an extension should
be requested, the procedure prescribed in the Board's letter
Of November 9, 1962 (S-1846), should be followed.)
BOARD OF GOVERNORS
OF THE
Item No.
5
4/17/63
FEDERAL RESERVE SYSTEM
WASHINGTON 25. O. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
April 17, 1963
Board of Directors,
Cudahy Marine Bank,
Cudahy, Wisconsin.
Gentlemen:
The Board of Governos of the Federal Reserve
System approves the establishment by Cudahy Marine Bank,
Cudahy, Wisconsin, of a'branch in the vicinity of the
intersection of Layton and Packard Streets, Cudahy,
Wisconsin, provided the branch is established within
six months from the date of this letter.
Very truly yours,
(Signed) Kenneth A. Kenyon
Kenneth A. Kenyon,
Assistant Secretary.
(The letter to the Reserve Bank stated that the Board also
had approved a six-month extension of the period allowed
to establish the branch; and that if an extension should be
requested, the procedure prescribed in the Board's letter
of November 9, 1962 (S-1846), should be followed.)
1256
Item No. 6
4/17/63
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
April 17, 1963
Board of Directors,
Fidelity State Bank,
Topeka, Kansas.
Gentlemen:
The Board of Governors of the Federal
Reserve System approves the establishment by
Fidelity State Bank, Topeka, Kansas, of a branch
at 901 Topeka Boulevard, Topeka, Kansas, provided
the branch is established within one year from
the date of this letter.
Very truly yours,
(Signed) Kenneth A. Kenyon
1(enneth A. Kenyon,
Assistant Secretary.
(The letter to the Reserve Bank stated that the Board also
had approved a six-month extension of the period allowed
to establish the branch; and that if an extension should
be requested, the procedure prescribed in the Board's
letter of November 9, 1962 (S-1846), should be followed.)
4,1T/g . 74 257
April 15, 1963.
To:
Board of Governors
Prom:
Robert L. Sammons
Subject: Foreign travel -- Mr. Yves Maroni
The State Department has indicated to us that it would
e khighly
of the
b
,
desirable to include Mr. Yves Maroni as a member
y,.S. delegation to the Tenth Session of the U.N. Economic Commission
or Latin America, to be held in Mar del Plata, Argentina, from
ivlaY 6 to May 18. One of the items on the agenda relates to payments
Maroni
t 1"rengements within the Latin American common market. Mr.
,
e
this
with
topic
as attended two international meetings dealing
and is, therefore, particularly knowledgeable on this subject.
We have been advised that the Office of International
g
nferences, Department of State, which is responsible for arrangin
under
ng
operati
is
,s,
,
U'S. participation in international meeting
iarticularly stringent budget limitations this year, and would not
Maronils
e in a position to pay travel and per diem costs. Since Mr.
,
the
in
work
ing
continu
our
of
t
interes
!;articipation would be in the
dvision of International Finance, as well as in the interest of
44e U.S. Government in general, I recommend that he be authorized
that
attend the meeting as a member of the U.S. delegation and
,!,-41e necessary travel expenses, in accordance with standardized
/Wernment travel regulations, be paid by the Board.
'
CO
t
t
It is further recommended that Mr. Maroni be authorized
to
Spend an additional two weeks visiting central banks in the
countries of Argentina, Chile, Peru, and Colombia on his return
?113. The additional expenditure involved would be small and it
ruld give Mr. Maroni an opportunity for an on-the-spot observation
1-4 these important countries.
BOARD OF GOVERNORS
Item No.
8
4/17/63
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
CE
ADDRESS OFFICIAL CORRESPONDEN
TO THE BOARD
April 17, 1963
CONFIDENTIAL (FR)
Mr. Joseph B. Hall, Chairman,
Federal Reserve Bank of Cleveland,
Cleveland 1, Ohio.
Dear Mr. Hall:
ntment of
The Board of Governors approves the appoi
Reserve
al
Feder
the
of
Mr. W. Braddock Hickman as President
ired
unexp
the
for
1963,
Bank of Cleveland effective May 1,
The
1,
1961,
March
began
Portion of the five-year term that
an
Hickm
Mr.
to
y
salar
of
nt
Board further approves the payme
d
perio
the
for
annum
per
00
as President at the rate of $35,0
May 1 through December 31, 1963.
payment
The Board of Governors also approves the
the
of
dent
Vice
Presi
as
of salary to Mr. Maurice Mann
00
$18,0
of
rate
the
at
land
Cleve
Federal Reserve Bank of
1963.
31,
ber
h
Decem
throug
1
Per annum for the period May
of
These are the salary rates fixed by your Board
r of April 11, 1963.
Directors as reported in your lette
Very truly yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
@FedFRASER