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619 A meeting of the Board of Governors of the Federal Reserve Sys&S held in Washington on Thursday, April 29, 1937, at 2:30 p. m. PRESENT: Mr. Eccles, Chairman Mr. McKee Mr. Davis Mr. Bethea, Assistant Secretary Mr. Carpenter, Assistant Secretary Mr. Clayton, Assistant to the Chairman Consideration was given to each of the matters hereinafter retel'i*ed to and the action stated with respect thereto was taken by the 13°411: Letter to Mr. Preston, First Vice President of the Federal Reeatve -Dank of Chicago, stating that the Board approves changes in the 1)etsonnel classification plan of the Chicago bank, as recommended in hie 1 ,etter of April 20, which provided for increases in the maximum 41E0.4 ' 44e8 for the following positions: From Coda Clerk, Leased Wire, Codes & T elegrams Department To 4'.2,160 42,400 Bill A nalyser, Disbursing Dept. 1,800 2,160 4elleral Clerk, Check Dept. 1,800 2,160 Approved unanimously. Telegram to Mr. Harrison, President of the Federal Reserve Bank or New York, reading as follows: to "Your letter April 28 inclosing draft of proposed cable th .tate Bank of USSR. For your records, you are advised e-e4 following an inquiry from the Treasury, Board of GovT1 1:40rs authorized Chairman Eccles informally to state to y:1181117 Department that if and when request was made by orstbank for approval of opening of account for State Bank Board would approve opening of account provided 620 4/29/37 -2- "Such openingcould be arranged on same general terms and conditions as accounts opened by your bank for other central banks having accounts with you. Chairman Eccles advised Treasury Department accordingly by telephone." Approved unanimously. Letter to Mr. Sproul, First Vice President of the Federal Reear've Bank of New 'York, reading as follows: is made to your letter of April 22 stating that "Reference Your bank has decided for the present to limit expenditures on behalf of members of the bank's staff who may hereafter be selected to attend the Graduate School of Banking at Rutgers to the granting of leave of absence with pay plus ranaportation expenses. "It is noted, however, that your bank desires to pay all of the fees and expenses incident to attending the Graduate School in the case of one of the employees of the Federal Reserve bank who enrolled last year in anticipation of e°mPleting the three year course on the basis of the bank's ?TaYing the entire cost of attendance at the Graduate School. the circumstances the Board will interDose no objection to the payment by the Federal Reserve bank in this case or e, , -a fees and expenses, which it is understood will amount a36.ft Approved unanimously. Bail),or Letter to Mr. Swanson, Vice President of the Federal Reserve Minneapolis, reading as follows: "Reference is made to your letter of April 13, 1937, with 4, osUre presenting for the Board's consideration the ques"-on whether, under the provisions of section 8 of the Claymr Antitrust Act, as amended, and the Board's Regulation L, to 8 'R. Kirby, Jr., Duluth, Minnesota, may serve as a direcOf Northwestern State Bank of Duluth while at the same mo)3 , , 164 8erving The Northern National Bank of Duluth and Duluth Plan Company, all of Duluth, Minnesota. se "It is noted from your letter that Mr. Kirby is also Nj ving Miners State Bank, Chisholm, Minnesota, and The First 1311:;ional Bank of Virginia, Virginia, Minnesota; and that, to"r date of January 16, 1937, you advised him with respect volhis various interlocking relationships except that inThe Northern National Bank of Duluth and Northwestern i 621 4/29/37 -3"State Bank of Duluth in connection with which you requested information relative to the existence of such common ownership of stock of these institut ions and Duluth Morris Plan Company as might bring an interlocking relationship involving The Northern National Bank of Duluth and Northwestern State Bank of Duluth within the contemplation of the exception set forth in paragraph (d)(4) of Section 2 of the Board's Regulation L. "It appears from the information subsequently submitted in response to your request that, with the exception of quailtYing shares of directors, Duluth Morris Plan Company owns all of the capital stock of Northwestern State Bank of Duluth. 1 ,,t 4, also appears, that although five of the fourteen directors ' 41 Duluth Morris Plan Company are either directors or officers The Northern National Bank of Duluth, 'the combined stockn of such directors and of other shareholders do not !Mount to more than 50 per cent of the common stock of the two corporations'. "The exception set forth in paragraph (d)(4) of Section 2 0f the Board's Regulation L is applicable only to relationhips involving a member bank and 'banks ... more than 50 . 1/ar cent of the common stock of which is owned directly or indirectly by persons who own directly or indirectly more an 50 per cent of the common stock of such member bank'. Although it appears that more than 50 per cent of the comn stock of Northwes tern State Bank of Duluth is owned ractlY or indirectly by persons who own more than 50 per Cent of the common stock of Duluth Morris Plan Company, a State nonmembe r institution, it does not appear that persons Who own directly or indirectly more than 50 per cent of the brnon stock of The Northern National Bank of Duluth, a membank, own either directly or indirectly more than 50 per Cent c of the common stock of Northwestern State Bank of Duluth. gr : °!dingly, it appears that the exception set forth in pare4,14 (d)(4) of Section 2 of the Board's Regulation L is not 8V) :Licable to a relationship involving The Northern National thil of Duluth and Northwestern State Bank of Duluth and ?efore, that Mr. Kirby may not serve at the same time as director or officer of these institutions." Z Approved unanimously. Thereupon the meeting adjourned. Assistant Secretary. Chairman.
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