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A meeting of the Federal Reserve Board was held in the office of the Pederal Reserve Board on Thursday, April 26th, at 11:35 a.m. PRESENT: Vice Governor Platt Mr. Hamlin Mr. Miller Mr. Mitchell Mr. Crissinger Foxton, Secretary The minutes of the meetingof the Federal Reserve Board held on April 25th were on motion approved as amended. Letter dated April 25th, from Messrs. Shearimin and Sterling, Attorneys, 55 Wall Street, New York City, transmitting for the approval of the Federal Iletterve Board an application of the National City Bank of New York for an order permitting the bank to open a sub-branch, agency or office of its Cuban brarich in the town of Florida, Province of Camaguey, Cuba. Upon motion, the following approval of the application was ordered entered upon the minutes of the Board: "The National City Bank of New York having on or about April 26, 1923, filed an application with this Board for the purpose of obtaining authority to establish a sub -branch, agency or office of its Cuban branch in the town of Florida, Province of Camaguey in the Republic of Cuba, and the said application having been considered; and it appearing that the said application is properly made under the laws of the United States of America and should be granted NOT WIREFORE IT IS ORDRIII), that the said applicati on be and it hereby is approved and that the said bank be and it hereby is authorized to establish a sub-branch,agency or office of its Cuban branch in the tov.n of Florida, Province of Camaguey in the Republic of Cuba". Report of Examimtion of the Federal Reserve Bank of Dallas and its bl'ariches as of Febrir.ry 10, 1923. Noted. 4/26/23 Report of Examination of the Federal Reserve Bank of San Francisco kid its branches as of March 3, 1923. Noted. Report of Examination of the First Fbderal Foreign Banking Association °t New Yozt as of January 22, 1923. Noted. Letter'dated April 9th, from the Chairman of the Federal Reserve Bank Or. Atlanta, requesting the views of the Federal Reserve Board with reference to a Possible application from the Citizens and Southern Bank of Savannah, Georgia, t° PUrchase a bank in the city of Charleston, South Carolina, and to operate it 48 a branch. Mr. Hamlin moved that "assuming that the state authorities are of the opinion that new or improved banking facilities are needed and that the state in which the parent bank is situated permits it, the Federal Reserve Board, if the condition of the• parent bank warrants it, will offer no objection to the establishimnt of a branch bank in a state and district different from that of the parent bank". Mr. Hamlin's motion being put by the chair was lost; Mr. Hamlin and Mr. Platt voting "aye" arid Mr. Miller, Mr. Mitchell and Mr. Crissinger voting "no". Letter dated April 16th, from Mr. D. H. Barrows, Acting Secretary of the Governors' Conference, enclosing a copy of the Secretary's minutes of the qolr •ernors' Conference, March 26 to 29, 1923, requesting that the Federal Reserve of the ° 1119-Y be given permission to at once give effect to those actions Conference concerning matters on which neither the law nor the regulations of the Boa.rd require a formal ruling of the Federal Reserve Board, and calling attent i°/1 to certain paragraphs upon which Federal Reserve Board action is neces44rY. 4/26/23 -3- Upon motion, the Board voted that the Federal Reperve banks may at once give effect to those actions of the Conference comern,ing matters on which neither the law nor the regulations of the Board require a formal ruling of the Federal Reserve Board. Paragraph 15, where it was voted that the Federal Reserve Board be re Tiested to make a ruling of the interpretation of the word "borrower" in Section 13 of the Federal Reserve Act. Referred to the Law Committee. Paragraph 20 (b), where it was voted, in adopting the uniform indorseOn checks received for collection (including guarantee of prior indorse4/Ilts) recommended by the Standing Committee on Collections, that the action be eclratUrticated to the Federal Reserve Board in order that the Board may make any ellazges that it might consider necessary in Regulation J. Referred to General Counsel. Paragraph 39, where it was voted to submit the report of the Insurance 00mr.4,. "tee and the proposed plan to the Federal Reserve Board for consideration ---" 171th the re quest that the Board advise the several Federal Reserve banks of its e(1/1clusion8 . Referred to the Executive Committee. Paragraph 53, where it was voted that the Group Insurance Plan c67erthr. -15 employees be continued and that the Federal Reserve Board be asked to ap- 14'°Ire raising the maximum to $5,000. Approved. paragraph 61, where it was voted that no change be made in the Board's t Of 99% of assets for agricultural paper, and that the limit on nine months' 11413er be fixed at 10% of assets. Approved. r 4/26/23 Letter dated April 25th, from Senator James E. Watson of Indiana advocating the use of Indiana Bedford Limestone in the Federal Reserve Bank building to be constructed at the Federal Reserve *4ank of St. Louis. The Secretary was instructed to tra.nanit a copy of Senator 7atson's letter to the Chairman of the Federal Reserve Bank of ' St. Louis. Mr. Mitchell requested the Board to take up the matter of authorizing an increase in the salary of the Governor of the Federal Reserve Bank of Ilinileapolis and moved that Governor Young's salary be increased from A18,000 to 20,000, effective July 1, 1923. Carried, Mr. Miller and Mr. Crissinger voting "no". Letter dated April 20th, from the Federal Reserve Agent at Chicago, With further reference to obstacles which Mr. Heath states exist in the Seventh Pederal Reserve District to the administration of the Board's letter, X-3688, dated. April 7, 192:';,subjec%rules governing examinations of state ment er banks. Mr. Miller stated that in accordance with notice given at the meeting of April 26th, he desired to move to amend the rules governing examinations of state member banks as adopted by the Board at its meeting of April 5, 1923, by striking out Paragraph #5, and modifying paragraph #4. At 1:15 p.m. a recess was taken until 230 p.m. At 3:00 p.m. the Board reassembled, those mmbers being present who were trresent at the morning session. Letter dated April 24th, from the Federal Reserve Agent at St. Louis Betting forth certain obstacles which Mr. Martin states exist in the Eighth ?ecleral Reserve District to the administration of the Board's letter, X-3688, cillted April 7th, 1923, subject "Rules Governing Examinations of State Member tazate. J 4/26/23 -5- Thereupon there ensued a discussion of Mr. Miller's motion to amend circular letter, X-3688, after Which without dissenting vote the Secretary was instructed to transmit to all Federal Reserve banks, the following telegram: "Replies received by the Board to letter X-3688 on Rules Governing Examination of State Member Banks indicates that some of the Banks have misunderstood the purpose and application of Certain of these rules, mainly because of apparent inconsistencies between paragraphs 4 End 5. The Board was led to lay down certain specific principles governing Federal Reserve banks in the matter of examinations because of practice in some Districts of Federal Reserve banks violating the terns of the law by virtually performing examining functions of the States gratuitously. It was not the intbntion of the Board to prevent Federal Reserve banks from making purely credit investigatIons. It is the view of the Board that Federal Reserve banks should, as a part of good credit administration, keep themselves informed of the credit practices and loan policies of their member banks. For this purpose Federal Reserve Banks are authorized from time to time to maim investigations of their member banks for credit purposes. Such investigations need not be charged for. It is also the view of the Federal Reserve Board that Federal Reserve banks should be free to use their judgment as to the time of making such investigations, and Board sees no objection to such purely credit investigations being made at times when State authorities are making their regular examinations. The provisions of paragraph 5 are intended to apply only to special examinations made by Federal Reserve bank examiners and to such examinations as they may make to determine the solvency of a member bank. These two classes of examinations, under the terms of the Federal Reserve Act, must be charged for." TS OF COI ITT Dated April 26th, Dated April 25th, Dated April 25th, NO. I. Recommending changes in stock at Federal Reserve banks, as set forth in the Auxiliary Minute Book of this date. Approved. Recommending action on applications for fiduciary powers as set forth in the Auxiliary Minute Book of this date. Approved. Recommending approval of the application of Mr. Rollin F. Wilbur to serve at the sane time as director of the Tradesmens National Bank, Philadelphia, Pa. and of the E. P. Wilbur Trust Company, Bethlehem, Pa. Approved. 4/26/23 RZIORTS OF CO/Tin'TZT, Dated April 25th, ro. 1 (Cont 'd.) Recommending approval of the application of Mr. James J. Diamond to serve at the VIIM8 time as Vice President and director of the Textile National Bank, as director and ?resident of the Girard Avenue and Trust Company, and as director of the Logan Bank and Trust Company, all of Philadelphia, ?a. Approved. The meeting adjourned at 4:45 p.m. Secretary. APPrOved: Vice Governor.
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