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Minutes for
To:
Members of the Board
From:
Office of the Secretary
April 7, 1965.
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. Robertson
Gov. Balderston
Gov. Shepardson
Gov. Mitchell
Gov. Daane
Minutes of a meeting of the available members of the Board of
Governors of the Federal Reserve System on Wednesday, April 7, 1965.
The meeting was held in the Board Room at 10.:00 a.m.
PRESENT:
Mr. Robertson, Acting Chairman
Mr. Shepardson
Mr. Mitchell
Sherman, Secretary
Kenyon, Assistant Secretary
Molony, Assistant to the Board
Fauver, Assistant to the Board
Farrell, Director, Division of Bank Operations
Hexter, Assistant General Counsel
O'Connell, Assistant General Counsel
Shay, Assistant General Counsel
Goodman, Assistant Director, Division of
Examinations
Mr. Leavitt, Assistant Director, Division of
Examinations
Mr. Plotkin, Senior Attorney, Legal Division
Mr. Shuter, Attorney, Legal Division
Messrs. Egertson and McClintock, Supervisory
Review Examiners, Division of Examinations
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
The following actions were taken subject to ratification at the
next meeting of the Board when a quorum was present:
Discount rates.
The establishment without change by the Federal
Reserve Bank of Minneapolis on April 5, 1965, of the rates on discounts
and advances in its existing schedule was approved unanimously, with the
understanding that appropriate advice would be sent to that Bank.
Circulated or distributed items.
The following items, copies
of which are attached to these minutes under the respective item numbers
indicated, were approved unanimously:
4/7/65
-2Item No.
Letter to Ann Arbor Bank, Ann Arbor, Michigan, approving
the establishment of a branch on Maple Road.
Letters to Birmingham-Bloomfield Bank, Birmingham,
Michigan, approving the establishment of branches at
1393 South Woodward Avenue, Birmingham, and in the
vicinity of 28700 Wixom Road, Wixom, and approving
investments in bank premises.
1
2-3
Letter to Continental International Finance Corporation,
Chicago, Illinois, granting permission to purchase shares
of Commercial Bank of Zambia Limited, Lusaka, Zambia.
4
Letter to the Federal Reserve Bank of Philadelphia regarding
a proposed examination of The Wellsville National Bank,
Wellsville, Pennsylvania.
5
The attached Item No. 4 was approved in a form reflecting an
understanding that Continental Illinois National Bank and Trust Company
of Chicago and its Edge Act subsidiaries were currently operating on a
basis whereby foreign loans and investments were not in excess of the
guidelines established under the voluntary foreign credit restraint
effort.
The attached Item No. 5 was approved in a form reflecting concurrence in the recommendation of the Division of Examinations that
an examination of Wellsville National Bank not be authorized at this
time, but injecting the statement that if further efforts through the
Regional Comptroller of the Currency did not result in the Federal
Reserve Bank of Philadelphia obtaining such information concerning the
member bank as it felt was needed, the Board should be informed.
The
-3-
4/7/65
thought within the Board was that in such event consideration could be
given to taking up the matter direct with the Comptroller of the Currency.
Items held over.
In view of certain questions that arose con-
cerning the relationship of the application to the situation of several
other banks in Kansas City having a substantial volume of interbank
deposits in proportion to total demand deposits, it was decided to hold
over for further discussion when other members of the Board were available the request of Mercantile Bank and Trust Company, Kansas City,
Missouri, for permission to carry reserves applicable to banks other
than reserve city banks.
It was also decided to hold over a question relating to interpretation of the term "held of record" as used in section 206.2(j) of
Regulation F, Securities of Member State Banks.
In the preliminary
discussion of this matter, Governor Mitchell expressed reservations
about adopting the position that the Legal Division had recommended.
The meeting then adjourned.
Secretary's Note: Governor Shepardson today
approved on behalf of the Board a memorandum
from Reed J. Irvine, Associate Adviser, Division
of International Finance, requesting permission
to teach a course in Economics at George
Washington University.
Secretary
BOARD OF GOVERNORS
Item No.
4/7/65
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON, D. C. 20551
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
April 7, 1965.
Board of Directors,
Ann Arbor Bank,
Ann Arbor, Michigan.
Gentlemen:
al Reserve
The Board of Governors of the Feder
by Ann Arbor Bank,
System approves the establishment
the west side of
Ann Arbor, Michigan, of a branch on
Dexter Road in
Maple Road between Jackson Road and
established within
Ann Arbor, provided the branch is
.
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;
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. 2
4/7/65
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON, D. C. 20551
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
April 7, 1965.
Board of Directors,
Birmingham-Bloomfield Bank,
Birmingham, Michigan.
Gentlemen:
The Board of Governors of the Federal Reserve
System approves the establishment of a branch by
Birmingham-Bloomfield Bank, Birmingham, Michigan, at
1393 South Woodward Avenue, Birmingham, Michigan,
provided the branch is established within six months
from the date of this letter.
The Board of Governors also approves, under
the provisions of Section 24A of the Federal Reserve
Act, an additional investment in bank premises of
$165,000 for the purposes of acquiring land and for
such improvements as may be requisite to establishing
banking quarters for the above branch.
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;
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.)
7
Item No. 3
4/7/65
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
April 7, 1965.
Board of Directors,
Birmingham-Bloomfield Bank,
Birmingham, Michigan.
Gentlemen:
The Board of Governors of the Federal Reserve
System approves the establishment by Birmingham-Bloomfield
Bank, Birmingham, Michigan, of a branch in the vicinity
of 28700 Wixom Road, Wixom, Michigan, provided the branch
is established within six months from the date of this
letter.
The Board of Governors also approves, under the
provisions of Section 24A of the Federal Reserve Act, an
additional investment in bank premises of $112,000 for the
purposes of acquiring land and for the construction of a
building thereon in which the proposed branch will be
located.
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;
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.)
Item No. 4
4/7/65
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON, D. C. 20551
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
April 7, 1965.
Continental International Finance Corporation,
231 South LaSalle Street,
Chicago 90, Illinois.
Gentlemen:
In accordance with the request contained in your letter
of February 3, 1965, transmitted through the Federal Reserve Bank
of Chicago, and on the basis of the information furnished, the
Board of Governors grants consent for your Corporation ("CIFC")
to purchase and hold up to one-third (1/3) of the initial issue
of shares of Commercial Bank of Zambia Limited ("CBZL"), Lusaka,
Zambia, at a cost of approximately US$250,000, provided such
stock is acquired within one year from the date of this letter.
The foregoing consent is given with the understanding
that the foreign loans and investments of CIFC, combined with those
of Continental Illinois National Bank and Trust Company of Chicago
and Continental Bank International, including the investment in
CBZL now being approved, will not exceed the guidelines established under the voluntary foreign credit restraint effort now
in effect.
Very truly yours,
(Signed) Karl E. Bakke
Karl E. Bakke,
Assistant Secretary.
BOARD OF GOVERNORS
Item No. 5
4/7/65
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25. O. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
April 7, 1965.'
Mr. Joseph R. Campbell, Vice President,
Federal Reserve Bank of Philadelphia,
Philadelphia, Pennsylvania. 19101
Dear Mr. Campbell:
In your letter of March 24, 1965, to Mr. Frederic Solomon,
You commented on your lack of information regarding The Wellsville
National Bank, Wellsville, Pennsylvania. You stated that you
considered it advisable to write again to Regional Comptroller of
the Currency Abrahamson requesting information and tell him that
You propose to examine the bank unless you get specific information
about its general condition.
The Board feels it appropriate for you to discuss this
matter again with Mr. Abrahamson and even to address another formal
request to him for information regarding the bank. If you are
thus unable to obtain the information you need, the Board should
be informed in order that it may consider further what action should
be taken. The Board sees no reason to inject itself into the
supervision of The Wellsville National Bank to the extent of an
on-the-premises examination at this time; therefore, it does not now
authorize an examination of this bank by the Federal Reserve Bank
of Philadelphia.
Very truly yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
@FedFRASER