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6b2 Pederai Ilinutes of actions taken by the Board of Governors of the Reserve System on Friday, April 30, 1948. PRESENT: Mr. Mr. Mr. Mr. Draper Evans Vardaman Clayton Mr. Mr. Mr. Mr. MiMites of Carpenter, Secretary Sherman, Assistant Secretary Morrill, Special Adviser Thurston, Assistant to the Board actions taken by the Board of Governors or the Fed- se e SYstem on April 29, 1948, were approved unanimously. 'Telegrams to the Federal Reserve Banks of Atlanta, Chicago, Louis) Kansas City, and San Francisco stating that the Board apPliNe the establishment without change by the Federal Reserve Banks 8t. °I* Cille4gc)/ Kansas City, and San Francisco on April 27, by the Fedof S. Louis on April 28, and by the Federal ReOf Atlanta on April 29, 1948, of the rates of discount 1.1'11:1/11'ehase In their existing schedules. Approved unanimously. "the t raorandilim dated April 29, 1948, from Mr. Leonard, Director °tgeoree 1°11 of E inations, recommending that the resignation Will 4 411 .44404 4 t4 4,0se E lk1:413 -4-ams, an Assistant Federal Reserve Examiner in that "cepted to be effective, in accordance with his request, of business June 25, 1948, with the understanding that Nit4 /34Yeat would be made for annual leave remaining to his 8 or that date. 693 14/30/48 -2Approved unanimously. Memorandum dated April 30, 1948, from Mr. Bethea, Director °t theD of Administrative Services, recommending an increase the basic salary of Mrs. Mildred Tydings, Supervisor of the Cafeteria iz tive that Division, from 4;)3,898.80 to $4,024.20 per annum, effecl'aY 2)1948. Approved unanimously. 441, or tileelitter to Mr. TialtSep Vice President of the Federal Reserve York, reading as follows: elattli:Ileference is made to your letter of April 27, 1948, Port Jeff,:iding the proposal of The Bank of Port Jefferson, Port-.T ra°r13 New York, to absorb The First Nationalestablish Bank of a br"-et.fferson, Port Jefferson, New York, and to --; 1 eu in Port Jefferson Station, New York. noted that State banking authorities have apta„ Provethe .‹ is of proposed merger agreement and that the Reserve 4ot r„ the opinion that the proposed transaction will 11141t in a change in the general character of the the (,-es of The Bank of Port Jefferson or in the scope of of cohdir°rate powers exercised by it within the meaning of membership numbered 1 to which it is subject. Iihelat;-,seumed that the Board will be advised in due course t 2,!ef 1-1 . ame of the continuing institution is changed with vl 1\4:4-17' aPproval of the State authorities to 'The Bank -0'"ern Brookhaven.' 41°1's eIl.„, 11 view of your recommendation, the Board of &over ;.11 P0 ;,.oves the establishment and operation of a branch 'Jerre:" 'Jefferson Station, New York, by The Bank of Port Prop° a(c)In, Port Jefferson, New York, before or after the change in its corporate title, provided the absorpteeter* The First National Bank of Port Jefferson is efktt;ted tantially in accordance with the plan as subBuosOf bank has paid up and unimpaired capital stock bank n:°Pri tAl, than $500,000, and prior approval of the ap-ellt 4-1-iotate authorities is obtained for the establish'41's branch; and with the understanding that , self f°1" the Reserve Bank is to review and satisfy Qat, as to the Aro13°s le alit of all steps taken ken to effect -%., absorption 2nrd establish the branch." Approved unanimously. 4/30/48 -3-Tele gram to the Presidents of all Federal Reserve Banks reading as Naows: res "Referring Board's letter April 13 and previous corto P°ridellee regarding proposed amendment to Regulation J ,,orauthorize ay2conditionalpayment of checks, American Banker rtiiirrhursd April 29, on page 1, indicates that Board isn had hearing on May 17 regarding this matter. This it ict e0..,.re.- - c t. In publishing notice of proposed action ,I X0' iel eral Register, Board has invited comments in writing. 1114141;:e has suggested or requested a hearing and the Board -0 present plans for any such hearing." Approved unanimously. Letter to the Presidents of all Federal Reserve Banks reading , tiS 0.1.011 -Love: keetm • nin accordance with the understanding reached at the Of .671-g„of the Conference of Presidents with the members Vith 400ard on February 27, 1948, there is enclosed hereicapit;,new draft of the proposed bill to modify member bank 11-1requirements. Etdrais .411t11 respect to the capital stock required for the (1114-6,:°4 of State banks to membership, the bill would re°rear! 2 --„,T-Ilimum of$50 000, with the exception that banks Initted i— :Prior to the l enactment of the bill could be adI1T/; I th a minimum of $25,000. 1)1144 e bill contains a provision requiring State member e4itai" obtain the Board's consent before reducing their 40iike sT.00k. As you know, national banks and insured %tIlher banks are now required by law to obtain the conDepoer the r Comptroller of the Currency and the Federal T the'alsurance Corporation, respectively, and a majority kertiber'Aste member banks are subject to a condition of ticalsi,, ship requiring the Board's consent prior to reduc1,174 capital stock. the ' 11 lieu of the existing requirements with respect to Gstabl• lshment of domestic branches by State member 13141111 'Ile bill would provide that no State member bank tShtateseGtablish and operate any new branch within the United ;;;G PtiZietiler an in-town or out-of-town branch, without -Ls eetZ,consent of the Board. The provisions governing s li,:;;ishment of domestic branches by State member be divorced completely from those governing 695 4/30/48 -4lithe is est ablishment of branches by national banks. This suggested in view of the fact that the Comptroller of i:Currency has advised the Board, in effect, that he tiacIPPosed to any change in the capital requirements for 1, esi establishment of out-of-town branches by national ET7s other than the elimination of the requirement that (01,41°11e1 bank must have a minimum capital of $500,000 411„Leeser amount in a few States) in order to establish su_ch branch. "Another zeraber hank possible approach would be to leave State S subject to the same requirements as national 8 with respect to the establishment of out-of-town q te,. 11.ee and to amend the requirements governing branches trconal banks to the extent acceptable to the Compbark er. If this were done, however, both State member the:and national banks would continue to be subject to Ittwtimc.luireanent that a bank with out-of-town branches capit;';ve capital at least equal to the minimum aggregate -31- required for the organization of unit national hillA4.11 the places in which its head office and its are situated; and, thus, the discrimination be• °zate member banks and State nonmember banks with q b,n to the capital required for the establishment -Zehee would be only partially eliminated. tions we will be glad to receive any comments or sugges114hich You may wish to make concerning any of the Vewohle,esPects of the proposed bill; and, specifically, bra/107; like to have your views as to which type of tion :LLegislation you favor in the light of the situa441 Juur District." Approved unanimously. Sec etary. 4Pptoved z Member.
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