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Minutes for April 22, 1964 To: Members of the Board From: Office of the Secretary 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. Chm. Martin Gov. Mills Gov. Robertson Gov. Balderston Gov. Shepardson Gov. Mitchell Gov. Daane 4 A, ( r•• ) IA) - Minutes of a meeting of the available members of the Board of Governors of the Federal Reserve System on Wednesday, April 22, 1964. The meeting was held in the Board Room at 10:15 a.m. PRESENT: Mr. Robertson, Acting Chairman Mr. Shepardson Mr. Mr. Mr. Mr. Mr. Mr. Mr. Mr. Mr. Sherman, Secretary Kenyon, Assistant Secretary Fauver, Assistant to the Board Hackley, General Counsel Farrell, Director, Division of Bank Operations Johnson, Director, Division of Personnel Administration Spencer, General Assistant, Office of the Secretary Egertson, Supervisory Review Examiner, Division of Examinations McClintock, Supervisory Review Examiner, Division of Examinations The following actions were taken subject to ratification at the next meeting of the Board at which a quorum was present: Circulated items. The following items, copies of which are tItt4ched to these minutes under the respective item numbers indicated, vels,„ aPproved unanimously: Item No. tetter o The Connecticut Bank and Trust Company, , clrd, Connecticut, approving the establishment Of' a branch at 2775 Main Street. Lett r Pet:- to Peoples Union Bank and Trust Company, McKeesport, sYlvania, approving the establishment of a branch in , liar , - sori City. tett 1, j- to The Bank of Hartsville, Hartsville, South 1412-411a, approving the establishment of a branch at 4170 1416 Carolina Avenue in lieu of the branch previously 411j,?,11!d by the Board to be established at Carolina Avenue ,egar Lane. 1 2 3 4/22/64. -2Item No. Letter to the Federal Deposit Insurance Corporation l l'egarding the application of Bremen State Bank, Bremen, wri i(1 , 18.11a, for continuation of deposit insurance after ' llicirawal from membership in the Federal Reserve ( :_A kqstem. 14. lokt,ter to Founders National Bank of Oklahoma City, Itlahoma City, Oklahoma, granting its request for , .verinission to maintain reduced reserves. 5 letter to South Colorado National Bank of Denver, t,nver, Colorado, granting its request for permission maintain reduced reserves. 6 Letter to the the Federal Reserve Bank of Cleveland approving PaYment of salaries to three officers assigned to the innati Branch at rates fixed by the Bank's Board of '4rectors. 7 High-speed counting equi.ment (Item No. the 8). At the meeting of board on March 23, 19614., consideration was given to views expressed by t he Conference of Presidents and the Board's Division of Bank Operations I the advantages and disadvantages of using high-speed currency counting e(1/11Palent at Reserve Banks to verify incoming deposits of predominantly tit the --, +5, and $10 bills, and whether a uniform System position concerning Utilization of such a procedure would seem desirable. It had been 4()tecl that the Federal Reserve Bank of Philadelphia was using such equip0 prove currency deposits, with substantial operating economies 1314 little opportunity for the detection of counterfeits. In view of differing approaches to the question the Board decided to cler er, until a meeting with President Bopp of the Philadelphia Reserve khlt eould be held, the sending of a proposed letter to the Chairman of I:WAY V22/614 -3- the Conference of Presidents that would take the position that a reasonable compromise could be achieved by limiting the use of the high-speed chanical equipment to $1 bills as long as there were relatively few coUrterfeits in that denomination. At the Board meeting today, Mr. Sherman reported on telephone ecriversations with President Bopp that took place yesterday afternoon. ?resident Bopp had stated that the Federal Reserve Bank of Philadelphia 1748 that day adopting the practice of limiting the use of its high-speed counting equipment to incoming deposits of $1 bills. This l'e.etlee would be in line with a recommendation of the Subcommittee on Cash) Leased Wire, and Sundry Operations in which the Conference of dents and the Division of Bank Operations had concurred. In view of the decision made by the Federal Reserve Bank of --eJLphia, it was agreed that a meeting with President Bopp was no , 10ner necessary, and that the proposed letter to the Chairman of the Conference should now be sent with minor modifications. A Co." of the letter to Chairman Hayes, as sent, is attached as Item No. 8. The meeting then adjourned. Secretary's Note: Pursuant to recommendations contained in memoranda from the Division of Administrative Services) Governor Shepardson today approved on behalf of the Board the following actions relating to the Board's staff: litnient letth 1.11.1bert L. Steward as Messenger, Division of Administrative Services, etlt : A asie annual salary at the rate of $3,305, effective the date of ' 1*--Ice upon duty. 1381 4/22/64. -4- salarY se Margie W. Lakatos„ Mailing List Clerk, Division of Administrative Inriceso from $30985 to 0,215 per annum, effective April 261 1964. Secret BOARD OF GOVERNORS Item No. 1 4/22/64 OF THE FEDERAL RESERVE SYSTEM WASHINGTON, O. C. 20551 ADDRESS orriciAL CORRESPONDENCE TO THE BOARD April 22, 1964 Board of Directors, The Connecticut Bank and Trust Company, Hartford, Connecticut. G entlemen: The Board of Governors of the Federal Reserve !Ystem approves the establishment by The Connecticut Bank and Trust Company, Hartford, Connecticut, of a branch at 2775 Main Street, Hartford, Connecticut, provided the branch is established within one year from the date of this letter. Very truly yours, (Signed) Karl E. Bakke Karl E. Bakke, 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; !na that if an extension should be requested, 6he procedure prescribed in the Board's letter °f November 9, 1962 (S-1846), should be followed.) Lt Item No. 2 II-/22/64 BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM WASHINGTON, D. C. 20551 ADDRESS arriciAL CORRESPONDENCE TO THE BOARD April 22, 1964 Board of Directors, Peoples Union Bank and Trust Company, McKeesport, Pennsylvania. Gentlemen: The Board of Governors of the Federal Reserve System approves the establishment by , Peoples Union Bank and Trust Company, McKeesport, Pennsylvania, of a branch in Harrison City (unincorporated), Penn Township, Westmoreland County, Pennsylvania, provided the branch is established within one year from the date of this letter. Very truly yours, (Signed) Karl E. Bakke Karl E. Bakke, Assistant Secretary. (The letter to the Reserve Bank stated that the Board also had approved a six-month extension of the period llowed 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 Item No. 3 4/22/64 OF THE FEDERAL RESERVE SYSTEM WASHINGTON, D. C. 20551 l•-• • ADDRESS OFFICIAL CORRESPONDENCE TO THE BOARD L.3 sk`'‘ ..L RESt$.• April 22, 1964 Board of Directors, The Bank of Hartsville, Ha rtsville, South Carolina. G entlemen: On June 20, 1963, the Board of Governors of the Federal Reserve System approved the establishment of a branch by The Bank of Hartsville at the corner of Carolina _ivenue and Cedar Lane, Hartsville, South Carolina. The board now understands that you wish to change the location °f this branch to 1412-1416 Carolina Avenue, Hartsville, South Carolina. branch The Board approves the establishment of this by approved previously that of the at new location in lieu the Board, provided the branch is established within one Year from the date of this letter. Very truly yours, (Signed) Karl E. Bakke Karl E. Bakke, A-isistant Secretary. (The letter to the Reserve Bank stated that the Board also had approved a six-month extension °I' the period allowed to establish the branch; azd that if an extension should be requested, the Procedure prescribed in the Board's letter of November 9, 1962 (3-1846), should be followed.) I_385 Item No. 4 BOARD OF GOVERNORS 4/22/64 OF THE FEDERAL RESERVE SYSTEM WASHINGTON, D. C. 20551 ADDRESS OFFICIAL CORRESPONDENCE TO THE BOARD April 22, 1964 The Honorable Joseph W. Barr, Chairman, Federal Deposit Insurance Corporation, Washington, D. C. 20429. Dear Mr. Barr: Reference is made to your letter of April 8, 1n964, concerning the application of Bremen State Bank, remen, Indiana, for continuance of deposit insurance after withdrawal from membership in the Federal Reserve SYstem. No corrective programs that the Board of Governors believes should be incorporated as conditions to the continuance of deposit insurance have been urged 11Pon or agreed to by the bank. Very truly yours, (Signed) Karl E. Bakke Karl E. Bakke, Assistant Secretary. Item No. BOARD OF GOVERNORS 5 4/22/64 OF THE FEDERAL RESERVE SYSTEM WASHINGTON, D. C. 20551 ADDRESS OFFICIAL CORRESPONDENCE TO THE BOARD April 221 1964 Board of Directors, Pounders National Bank of Oklahoma City, Post Office Box 16656, Oklahoma City, Oklahoma. Gentlemen: the With reference to your request submitted through s, Governor of Board the City, Kansas Federal Reserve Bank of Reserve actig under the provisions of Section 19 of the Federal a Oklahom Bank of Act) grants permission to the Founders National reCity to maintain the same reserves against deposits as are as quired to be maintained by nonreserve city banks, effective Of the date it opens for business. Your attention is called to the fact that such of Governors. Permission is subject to revocation by the Board Very truly yours, (Signed) Merritt Sherman Merritt Sherman, Secretary. 4 Item No. BOARD OF GOVERNORS . '-f '41.`1' e 6 4/22/64 OF THE FEDERAL RESERVE SYSTEM WASHINGTON, D. C. 20551 ADDRESS OFFICIAL CORRESPONDENCE TO THE BOARD April 22, 1964 Board of Directors, South Colorado National Bank Of Denver, Denver, Colorado. Gentlemen: through With reference to your request submitted of Board the Federal Reserve Bank of Kansas City, the of Governors, acting under the provisions of Section 19 South the Federal Reserve Act, grants permission to the same Colorado National Bank of Denver to maintain the maintained reserves against deposits as are required to be tY nonreserve city banks, effective as of the date it °Pens for business. that such Your attention is called to the fact of Board Permission is subject to revocation by the Governors. Very truly yours, (Signed) Merritt Sherman Merritt Sherman, Secretary. tiag; BOARD OF GOVERNORS Item No. OF THE 7 14./22/611. FEDERAL RESERVE SYSTEM WASHINGTON, 0. C. 20551 ADDRESS OFFICIAL CORRESPONDENCE TO THE BOARD April 221 1964 ENTIAL FR 1.11, P(6 — araddock President, Hickman,Cleveland clestal Reserve Bank of ve144, Ohio 44101. 14r. Hickman: The Board of Governors approves the payment of salaries to the c't the Federal Reserve Bank of Cleveland, Cincinnati Branch, below, at rates indicated, from the effective date through December 31, t/ltficet, 19 4 _Hanle Title 14 441ter H. Cashier ',Nard E. MacDonald Assistant Taylor Joseph W. Assistant Crowley Qg r , The salary rates approved 11-tted in your letter of April Cashier Cashier Annual Salary Effective $16,000 13,000 12,000 July 1 July 1 August 1 Date are those fixed by your Board of Directors, 9, 1964. Very truly yours, (Signed) Merritt Sherman Merritt SheLman, Secretary. 1L.3 Item No. BOARD OF GOVERNORS 8 4/22/64 OF THE FEDERAL RESERVE SYSTEM WASHINGTON, D. C. 20551 ADDRESS orriciAL COROICINPONDENOIC TO THE BOARD April 23, 1964. Alfred Hayes, Chairman, Conference of Presidents, Pederal Reserve Bank of New York, blew York, New York 10045. De4r Mr, Hayes: The Board's letter of September 3, 1963, noted the use of speed (De La Rue) currency counting machine to verify incoming the :';t8 of predominantly fit $1, $5, and $10 bills, and requested tu,v'ewa of the Conference of Presidents with respect to the advan,4-8 and disadvantages of this method of proving currency deposits uttil : ith respect to whether a uniform System position concerning the ' 24tion of such a procedure would seem desirable. 4 high_ 4p0 4 Subsequently, the Conference of Presidents, at its meeting Decem-er reape 2, 1963, concurred in the.following recommendations with 8144„et to this matter by the Subcommittee on Cash, Leased Wire, and 'Y Operations. 111. The Reserve System formally recognize its responsibility to produce and distribute finished packages of currency that insofar as reasonably possible do not contain unfit, counterfeits or raised bills. "2, The Reserve System as a matter of principle avoid prescribing a uniform position for or against utilization Of specific types of money-handling equipment. This determination as well as other operating detail should continue to remain with the President of each Reserve Bank." The Board understands that the use of the high-speed equip14erit trip clPer46-4tioned in its letter of September 3, 1963, permits substantial Oetectrg economies but affords little or no opportunity for the 431/11 of counterfeits. /14ve The Board believes that all Federal Reserve Banks and branches Nt: , „ 11 0bligation to make every reasonable effort to discover any 'here 'Keit bills that may be in the currency deposits received by them. al/ailab "tad appear to be no reason against using the most economic means le to prove deposits of $1 bills as long as counterfeiting of -2- wOaa denomination continues to be a rarity. On the other hand, there : 114 appear to be serious doubt that the use of the high-speed equip1 in question on denominations above $1 bills would fulfill the ' 0" temt obligation with respect to detection of counterfeits. Accordthe Board has concluded that it is inappropriate to use this 'illiPment in proving deposits above $1 bills. 2gY. Very truly yours, (Signed) Merritt Sherman Merritt Sherman, Secretary.
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