The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
Minutes for To: Members of the Board From: Office of the Secretary April 19, 1962 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 1. 1017. If you were present at the meeting, your -Lnitials will indicate approval of the minutes. If YOU were not present, your initials will indicate °IllY that you have seen the minutes. Chin. Martin Gov. Mills Gov. Robertson Gov. Balderston Gov. Shepardson Gov. King Gov. Mitchell _ Minutes of the Board of Governors of the Federal Reserve SYstem on Thursday, April 19, 1962. The Board met in the Board Room at 10:00 a.m. PRESENT: Mr. Mr. Mr. Mr. Mr. Mr. Balderston, Vice Chairman Mills Robertson Shepardson King Mitchell Mr. Sherman, Secretary Mr. Kenyon, Assistant Secretary Miss Carmichael, Assistant Secretary Mr. Fauver, Assistant to the Board Mr. Cardon, Legislative Counsel Mr. Farrell, Director, Division of Bank Operations Mr. Solomon, Director, Division of Examinations Mr. Hexter, Assistant General Counsel Mr. Daniels, Assistant Director, Division of Bank Operations Mr. Kiley, Assistant Director, Division of Bank Operations Mr, Goodman, Assistant Director, Division of Examinations Mr. Leavitt, Assistant Director, Division of Examinations Circulated or distributed items. The following items, which had been circulated or distributed to the Board and copies of which albe attached to these minutes under the respective item numbers iticlicated, were approved unanimously: Item No. tett, 443. 7ra to (a) Chemical International Banking Corporation Nelq?) Chemical International Finance, Ltd., both of ot,e°rk, New York, authorizing amendment of the Articles i sociation of each corporation to change the location ot : Nev .::8 home office from 165 Broadway to 20 Pine Street, xor k, New York. 1-2 4/19/62 -2Item No. Letter to First National City Bank, New York, New York, !PProving an extension of time within which a branch in a Juan, Puerto Rico, may occupy temporary quarters Uring construction of a new building. 3 IF,slegram to the Federal Reserve Bank of Kansas City 44terposing no objection to the rental, under purchase t1on, of electronic check processing equipment Z°nsisting of an IBM data processing system, supported 'Y National Cash Register encoding equipment. 14. r Mr. Goodman then withdrew from the meeting. Report on competitive factors (Baltimore-Easton, Maryland). %Icier date of April 12, 1962, there had been distributed a draft of ziePort to the Comptroller of the Currency on the proposed purchase °t assets and assumption of liabilities of The Easton National Bank moznana: Easton, Maryland, by Maryland National Bank, Baltimore, 144rnand. After certain changes in the body and conclusion of the report Itel'e suggested by Governor Robertson and agreed upon, the report was unanimously for transmittal to the Comptroller in a form in Irilich the conclusion read as follows: Maryland National Bank and The Easton National Bank do not appear to be competitors to an important degree and the Proposed transaction would eliminate little competition. It would, however, result in removal of the only bank in the 1irea in position to furnish significant competition for : 'arYland National Bank. The proposed purchase of assets nd assumption of liabilities reflects the continuance of a 6rend in Marylan0 toward concentration of banking resources in a few large banks. 4/19/62 Report on competitive factors (Savannah-Atlanta, Georgia). Under date of April 16, 1962, there had been distributed a draft of report to the Comptroller of the Currency on the competitive factors involved in the proposed purchase of assets and assumption of liabilities °I' The Citizens and Southern Bank of Atlanta, Atlanta, Georgia, by The Citizens and Southern National Bank, Savannah, Georgia. The con- clusion in the draft read as follows: The proposed transaction will have little effect on competition. In discussion, Governor Robertson suggested that the conclusion he changed since it appeared that the proposed transaction, combining ' 47° closely allied banks, would have no effect on competition. There being agreement with this suggestion, the report was approved unanimously transmittal to the Comptroller in a form in which the conclusion l'ead as follows: It would appear that combining the two institutions 'would correct an awkward situation with no change in the Present competitive situation. Report on competitive factors (Salem-Campbellsburg, Under date of April 13, 1962, there had been distributed a Of report to the Federal Deposit Insurance Corporation on the 11'(31)°83.1 of Farmers-Citizens State Bank, Salem, Indiana, to acquire the e'ssets of and assume liability to pay deposits made in State Bank of C114113bellsburg, Campbellsburg, Indiana. as follows: The conclusion of the report The acquisition of assets of and assumption of liability to pay deposits made in the State Bank of Campbellsburg, Campbellsburg, Indiana, by Farmers-Citizens State Bank, Salem, Indiana, would have little effect on competition. The report was approved unanimously for transmittal to the Pederal Deposit Insurance Corporation. Messrs. Molony, Assistant to the Board, Noyes, Director, and ic)ell) Adviser, Division of Research and Statistics, and Miss Stockwell, 8c0nomist, Division of Research and Statistics, entered the room at this Point. Report on S. 3130 (Item No. 5). Pursuant to the understanding at the Board meeting on April 180 1962, there had been distributed three it'llists of possible reply to the request of Chairman Robertson of the Sen4te Banking and Currency Committee dated April 11, 1962, for the 13°4rdi s views with respect to S. 3130, a bill which would authorize tile Secretary of Commerce "to purchase industrial and commercial " ^cletices of indebtedness to promote certain industrial and commercial 1044c, , ln redevelopment areas by lending institutions in order to help alleh areas plan and finance their economic redevelopment, and for c)thel‘ PurPoses." The first draft of reply would state that S. 3130 appeared to b. . ln many ways an improvement over S. 1212) introduced in the tirSt -esaion of the 87th Congress; that it would operate more etrectivelY 'kelt bA to accomplish its purposes in such redevelopment areas as handicapped by the inability of lending institutions to titip4), -'ee industrial and commercial projects; that the Board was not in V19/62 -5- 4 POSitiOn to judge whether legislation of this type was needed to assure the maximum effectiveness of other Government programs already adopted to provide assistance to redevelopment areas; but that if) in the judgment of the Congress, such legislation was necessary, ' S 3130 would seem a reasonable approach. The second draft would "Press doubt whether this proposal would significantly improve PPortunities in redevelopment areas generally. The third draft 'woula be limited to an expression of the view that S. 3130 would seem to Provide a reasonable approach if, in the judgment of the Congress, legislation of this type was needed in order to supplement other G°Iternplent programs already adopted to provide assistance to redeveloperlt areas. In discussion, Governors Mills, Robertson, King, and Balderston eressed a preference for the third of the three draft letters. Governor Shetlerdson expressed a preference for the second draft, subject to eel ' taln technical modifications suggested at this meeting, but indicated that he could accept the third draft. Governor Mitchell expressed a Pref. erence for the first draft, subject to certain technical modificatio , "e, but indicated subsequently that he would not object to the thira draft. Accordingly, it was agreed to send the letter of which a Qom,, ls attached as Item No. 5. Messrs. Cardon, Koch, and Leavitt then withdrew from the 4g, as did Miss Stockwell. 4/19/62 -6Atlanta building. On November 130 1959, the Board of Governors authorized the acceptance of bids for construction of an addition and alterations to the head office building of the Federal Reserve Bank of Atlanta. Upon completion of the addition, employees Ilsre moved from the old building pending alterations thereto. In a letter dated March 13) 1962, which had been circulated t0 the members of the Board for their information, President Bryan rePorted that the discovery of structural weaknesses in the old 11141cling had resulted in the discontinuance of remodeling work until fUlther investigation could be carried out. Subsequently, the building 1148 inspected by the Board's Consulting Architect, Mr. Witherell, andbY consulting and public building engineers, who confirmed the structural weaknesses. Governor Balderston reported that President Bryan called on 41411 18 and stated that a current inspection of'the old building by the Reserve Bank's engineer revealed further deterioration and danger that the roof slab might fall. Accordingly, it was considered tleceesEtrY to take immediate safety measures. Mr. Bryan was advised that 40 authorization on the part of the Board would appear to be 11(114ired. in order for him to take such measures, but that the situation %I°11141 be reported to the Board for its information. Later in the day *a II/7m advised the Board by wire that the contractor had been "al°rized to remove the roof slab as an emergency operation. 2.1 4/19/62 Mr. Farrell commented on recent reports regarding the build,A.Lig__ by the Board's architect and by consulting and building engineers, quoting excerpts from such reports, which indicated that the only solution appeared to be the complete demolition of the old building. After discussion, it was understood that Mr. Farrell would c4U President Bryan and inform him that the Board had been advised Narding the condition of the building and the emergency measures that had been authorized, including the removal of the roof slab; that there appeared to be no necessity for a visit by President %an to Washington at this time; and that the Board would be prepared to consider in due course such recommendations as might be made with 'esPect to termination of the present contractual arrangement for eling of the building or related matters. The meeting then adjourned. Secretary's Note: Pursuant to recommendations contained in memoranda from appropriate individuals concerned, Governor Shepardson approved today on behalf of the Board increases in the basic annual salaries of the following persons on the Board's staff, effective April 29, 1962: Division Basic annual salary From To •••••11.41111.011.M. Legal ktrton Veret, Attorney 421114e1 E. Entriken„ Attorney $6,600 7,820 $6,765 8,080 1 . -0 4/19/62 increases -8effective Apr' 290 1962 continued Basic annual salary From To Division .121.111L •••••••••• +mo ILLIPZ e m International Finance R°411eY H. Mills, Jr. Economist $1,320 $8,955 7,260 40992 70425 5,242 3,970 4,075 Administrative Services tonald W. Moon, Supervisor, Procurement Section .'nuer Thompson, Multilith Operator barbara Kay, Operator, Key Punch Secrtary 5i, BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM WASHINGTON 25, D. C. Item No. 1 4/19/62 ADDRESS OFFICIAL CORRESPONDENCE TO THE BOARD * April 19, 1962 exilenlical International Banking Corporation, ew York, New York. Ge ntlemen: This will acknowledge your letter of April 12, 1962, -"enatted through the Federal Reserve Bank of New York, requesting etppr for your Corporation to amend its Articles of Association yo2nange the location of its Home Office from 165 Broadway, New New York, to 20 Pine Street, New York, New York. In accordance with your request, and pursuant to Sectio the ,-n 211.3(d) of Regulation K, as amended to November 12, 1958, , c4apeard of Governors authorizes the amendment of the Articles 48sociation to reflect such change. Please furnish the Board of Governors a certified copy the ti,t41 resolution amending the Articles of Association when adopted Gore: shareholders of your Corporation. Also advise the Board of Wilercli,"6 in writing, through the Federal Reserve Bank of New York, ' 41e change in location is effected. Very truly yours, (Signed) Elizabeth L. Carmichael Elizabeth L. Carmichael, Assistant Secretary. BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM WASHINGTON 25, D. C. Item No. 2 4/19/62 ADDRESS OFFICIAL CORRESPONDENCE TO THE BOARD April 19, 1962 Chemical International Finance, Ltd., New York, New York. Gentlemen : This will acknowledge your letter of April 9, 1962, 'bran a, emitted through the Federal Reserve Bank of New York, requesting e° .1ral for your Corporation to amend its Articles of Association yor6 e"ange the location of its Home Office from 165 Broadway, New 's New York, to 20 Pine Street, New York, New York. In accordance with your request, and pursuant to Seotio the D-n 211.3(d) of Regulation K, as amended to November 12, 1958, As. , .. oard of Governors authorizes the amendment of the Articles of "qAtion to reflect such change. Please furnish the Board of Governors a certified copy q the tu resolution amending the Articles of Association when adopted Gov ue shareholders of your Corporation. Also advise the Board of : 1,41 111*rs in writing, through the Federal Reserve Bank of New York, the change in location is effected. Very truly yours, (Signed) Elizabeth L. Carmichael Elizabeth L. Carmichael, Assistant Secretary. ‘14,3,4! BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM WASHINGTON 25, D. C. Item No. 3 4/19/62 ADDRESS OFFICIAL CORRESPONDENCE TO THE BOARD April 19, 1962 Mr. Carl W. Desch, Cashier, First National City Bank, 399 Park Avenue, New York 22, New York. Dear Mr. Desch: Reference is made to your letter of March 29, 1962, ' 8 t)Mr. Howard D. Crosse, Vice President of the Federal Reserve , ank of New York, in which you refer to the Board's letter of ,arch 31, 1960, approving the removal of your branch in the ',4to Rey area of San Juan, Puerto Rico, to temporary quarters or a period of approximately two years, during the construction Your new building on another section of this same property. is noted that, due to delay in developing final plans for `41e proposed building and obtaining the necessary building rmit, it is expected that the new building will not be ready r occupancy before the second quarter of 1963. In the circumnces, the Board extends to September 30, 1963, the time within oh the branch may occupy temporary quarters during construction f the new building. r Please advise the Board of Governors in writing, through the Federal Reserve Bank of New York, when the branch is est ablished in permanent quarters. Very truly yours, (Signed) Elizabeth L. Carmichael Elizabeth L. Carmichael, Assistant Secretary. 4.4.334 Item No. TELEGRAM 4/19/62 LEASED WIRE SERVICE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM WASHINGTON April 91 1962 Clay - Kansas Ci Board interposes no objection to rental of high-speed processing equipment referred to. in Boyseni s March 1, 1962 letter to Farrell. (Signed) Merritt Sherman SHERMAN 4 BOARD OF GOVERNORS OF THE Item No. 5 FEDERAL RESERVE SYSTEM 4/19/62 WAS OFFICE OF THE VICE CHAIRMAN April 19, 1962 The Honorable A. Willis Robertson, Chairman, Banking and Currency Committee, United States Senate, Washington 25, D. C. Dear Nr. Chairman: This is in reply to your request of April 11, 1962, for the Board's views with respect to S. 3130 which would authorize the Secretary of Commerce "to purchase industrial !.lid commercial evidences of indebtedne ss to promote certain 1f1ld. 1clustrial and commercial loans in redevelopment areas by tending institutions in order to help such areas plan and 'inance their economic redevelopment, and for other purposes." The Board understands that the bill is, in effect, E: substitute for S. 1212, introduced in the first session of the ihe.87th Congress. If, in the judgment of the Congress, ' Legislation of this type is needed in order to supplement Other Government programs already adopted to provide assistance to redevelopment areas, S. 3130 would seem to provide a reasonable approach. Sincerely yours, (Signed) C. Canby Balderston C. Canby Balderston, Vice Chairman.
@FedFRASER