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Minutes for August 12, 1957
To:
Members of the Board
Frft:
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 proposed to place in the record of policy actions repired to be kept under the provisions of Section 10 of the Federal
'teserve Act an entry covering the item in this set of minutes
emunencing on the page and dealing with the subject referred to below:
Page 5
Approval of a discount
rate of 3-1/2 per cent
for the Federal Reserve
Banks of Boston, Atlanta,
and Dallas.
Should you have any question with regard to the minutes, it
vill be
appreciated if you will advise the Secretary's Office. Other1141
..4p, if you were present at the meeting, please initial in column A
OW to
indicate that you approve the minutes. If you were not present,
:
t ease initial in column B below to indicate that you have seen the
"1-triutes.
Chm. Martin
Szymczak
Gov. Vardaman
GcT. Mills
%v. Robertson
Balderston x
G°Ar. Shepardson
(
99r:;(*t
Minutes of actions taken by the Board of Governors of the
Federal Reserve System on Monday, August 12, 1957. The Board met
in the Board Room at 2:00 p.m.
PRESENT: Mr.
Mr.
Mr.
Mr.
Mr.
Martin, Chairman
Balderston, Vice Chairman
Vardaman
Mills
Shepardson
Carpenter, Secretary
Kenyon, Assistant Secretary
Thurston, Assistant to the Board
Riefler, Assistant to the Chairman
Thomas, Economic Adviser to the Board
Masters, Director, Division of
Examinations
Mr. Cherry, Legislative Counsel
Mr. Molony, Special Assistant to the Board
Mr. Horbett, Associate Director, Division of
Bank Operations
Mr. Koch, Assistant Director, Division of
Research and Statistics
Mr. Solomon, Assistant General Counsel
Mr. Farrell, Assistant Director, Division of
Bank Operations
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Testimony before the Senate Finance Committee. In accordance
with the understanding at the meeting on August 9, 1957, there had been
sent to the members of the Board under today's date a further revised
clraft of statement to be given tomorrow by Chairman Martin before the
Senate Finance Committee.
In response to a question by the Chairman, Governor Vardaman said
that Di,_e
had no comments with respect to the latest draft and that his
gen-eral views concerning the testimony continued to be substantially the
earne _s
a
expressed at the meeting on August 9.
Specific comments by the Chairman and other members of the Board
"''ulng the most recent revision of the testimony were directed toward
2251
8/12/57
-2-
incorporating certain additional points of information and effecting
certain editorial changes for the purpose of clarification and emphasis.
At the conclusion of the discussion, it was agreed that the changes
mentioned at this meeting would be incorporated in the testimony and
that the statement would be presented in a final form satisfactory to
Chairman Martin.
Messrs. Thurston and Riefler then withdraw from the meeting.
yj_e§a_f_jg_iLJStudofsmallbusilancinItemNo.l. Pursuant to the
Procedure agreed upon at the meeting on August 9, 1957, there had been
distributed to the members of the Board copies of letters concerning the
Board's survey of small business financing proposed to be sent to the
Presidents of the Federal Reserve Banks, to Chairman Fulbright of the
Senate Banking and Currency Committee, and to Senators Sparkman and
Clark and Congressmen Spence and Patman.
Governor Vardaman suggested that the letter to Senator Fulbright
(or which it was proposed to send copies to the other Congressmen named
above) be edited in such a way as to bring out more forcefully that the
slirveY could not be completed in its entirety by March 1, 1958, and that
the portions of the study which it now appeared that it would be possible
to complete by that date might not provide information sufficiently
adequate to permit judgments with regard to the credit needs of small
bilsinees•
He indicated that the reason for this suggestion lay in his
Iihderstanding that Senator Sparkman and perhaps other members of the
C"greas were holding proposed small business legislation in abeyance
8/12/57
-3-
until the next session of the Congress in the hope that the results
Of the survey would be available by that time. In the circumstances,
it vas his view that it would be desirable to make a full disclosure
With regard to the outlook for completing the study.
Following a discussion of the point raised by Governor Vardaman,
It was understood that a revised draft of the letter to Senator Fulbright
'
li°111d be prepared for the Board's consideration.
At the same time, it
/4ae Agat2g to transmit to the Reserve Bank Presidents the letter requesting their comments on the survey which had been distributed to the Board
Prior to this meeting. A copy of the letter sent pursuant to this action
is attached hereto as Item No. 1.
Bulletin on farm credit (Items 2 and 3). In a memorandum dated
Aligust 9, 1957, which had been distributed to the members of the Board,
Governor Shepardson referred to a bulletin on "Intermediate-Term Bank
Credit for Farmers" being developed by the Agricultural Commission of the
41111eri0an Bankers Association for the use of the Association's member banks.
The memorandum stated that the Commission desired to use a Foreword
eigned by representatives of the three Federal bank supervisory agencies
ell
ing the program, that the draft of the brochure and of the pro-
Posed Foreword had been reviewed by the staffs of the supervisory agencies,
and that it was understood that the Comptroller of the Currency and the
Chairman of the Federal Deposit Insurance Corporation intended to sign
the Foreword. It was the recommendation of Governor Shepardson that the
Chairman of the Board likewise sign the document.
2253
8/12/57
Following comments by Governor Shepardson on the origin and
nature of the proposed bulletin, unanimous agreement was expressed with
the recommendation contained in his memorandum. Copies of the letter
sent by Governor Shepardson to the American Bankers Association pursuant
to this action, and of the Foreword to the Association's proposed
b ulletin, are attached to these minutes as Items 2 and 3, respectively.
Messrs. Cherry, Molony, Horbett, and Koch then withdrew from
the meeting.
Items circulated to the Board. The following items, which had
been circulated to the members of the Board and copies of which are
attached hereto under the respective item numbers indicated, were
..e.ap42KtEl unanimously:
Item No.
Letter to The Cleveland Trust Company, Cleveland, Ohio,
0P2r0ving the establishment of a branch in North Olmsted,
‘
L :..")
. (For transmittal through the Federal Reserve Bank
Cleveland)
4
Letter to The Union Commerce Bank, Cleveland, Ohio, apthe establishment of a branch at 75" Public Square.
gor transmittal through the Federal Reserve Bank of
,-L
evelsnd)
5
1Letter to the Federal Reserve Bank of San Francisco inter411ing no objection to an expenditure of approximately
rib: the conversion of two elevators to self-service
:
0.0,f
0134
6
Letter to the Presidents of all Federal Reserve Banks transfng forms to be used by State member banks and their
'
6I 1l1ates in submitting reports as of the next call date.
t,sith the understanding that the letter would be sent when
"e forms were printed)
7
C
8/12/S7
-5-sItem No.
Telegram to the Presidents of all Federal Reserve Banks
dlieing that lump-sum payments to liquidate accrued lia!
oilities resulting from the pending changes in Retirement
SYstem benefits should be charged to Profit and Loss.
8
Letter to the Federal Reserve Bank of New York approving
an additional investment in bank premises by Fidelity
Union Trust Company, Newark, New Jersey.
9
Letter to the Federal Reserve Bank of Richmond approving
an additional investment in bank premises by The Farmers
Bank of Dinwiddie, Dinwiddie, Virginia.
10
1.,etter to the Federal Reserve Bank of Richmond concurring
rl the view that a proposed change in the location of a
Trench in La Grange, North Carolina, by Wachovia Bank and
list Company, Winston-Salem, North Carolina, would consti!
611te the mere relocation of an existing branch.
11
t
Letter to American Trust Company, San Francisco, California, 12
?Proving the establishment of a branch in Santa Rosa, Cali°rnie. (For transmittal through the Federal Reserve Bank
of San Francisco)
In voting to approve the foregoing Item No. 8, Governor Vardaman
noted that he did so because the question involved was only a matter
°I. accounting procedure and his vote therefore would not be inconsistent
With his fundamental position against the pending changes in the Bank
Plan of the Retirement System of the Federal Reserve Banks.
Mr. Farrell then withdrew from the meeting.
Discount rates (Item No. 1)). The Secretary recalled that, as
stated at the meeting on August 8, 1957, advice was received last week
fr°m certain Federal Reserve Banks that their directors had established
Without change the rates of discount and purchase in the Banks' existing
?C')C
{4.-91.1k7
8/12/57
-6-
schedules.
He then raised the question whether the Board wished to
send to those Banks the usual code telegram indicating that the Board
approved the reestablishment of the existing rates.
In summarizing staff discussion of the matter, Mr. Carpenter
said it was the prevailing view that no real need existed for formal
action on the part of the Board. While it had been suggested that failure
to respond to the telegrams from the Federal Reserve Banks in question
might be construed as exerting pressure on the Banks to raise the rate
fr°m 3 per cent, the staff had in mind that in the absence of a response
fi'om the Board the current rates would automatically remain in effect.
Also, if the Board refrained from acting it could avoid being put in the
Position of approving a rate of 3-1/2 per cent for certain Banks and a
3 Per cent rate for other Banks. Further points included the fact that
Pressure on the Banks, if the Board wished to exert pressure, might be
expected to take some more positive form and that approval of continuation of the existing rate schedule at the New York Reserve Bank might
be understood to indicate concurrence in the reasons cited in the Bank's
telegram advising of the directors' action reestablishing the current
In response to a question, Mr. Carpenter said it was contemplated
that if the New York Bank's Board of Directors acted this Thursday to
maintain the 3 per cent rate, consideration would have to be given at
that time to what action should be taken by the Board.
2256
8/12/57
-7In an ensuing discussion, during which reference was made
to the procedure followed by the Board in the past in somewhat similar
circumstances, Mr. Solomon brought out that technically speaking the
statutory requirement to establish the discount rate at least every 14
(Jars was placed on the Reserve Banks and that the Board therefore was
n°t specifically required to act on the establishment of the rate. On
the other hand, he said, the position might be taken that the actions
Of the Reserve Banks and the Board could be expected to flow in unison.
Mr. Thomas expressed the view that under certain conditions
there might be justifiable reasons for maintaining different discount
rates from one Reserve Bank to another. It was his view that the New
ic3rk Bank, by failing to establish a higher rate in the current circumstances, would soon find itself in an indefensible position, but he was
hot sure whether there was any compelling reason why the St. Louis Bank,
or example, should change its rate at this time. In general, he felt
that it was good precedent to establish that the Board had no objection
to differences in the discount rate between Federal Reserve districts.
Governor Vardaman stated that he would favor approval in routine
48hion of the action that had been taken by the New York Bank, for
°therwise the record might give the appearance that pressure had been
PlIt on the Bank to establish a higher rate. He did not feel that routine
41/ProV51 of the action would carry the implication that the Board also
concurred in the reasons stated by the Bank for reestablishing the
,
8/12/57
-8-
existing rate. If, later this week, the Bank's directors should
establish a higher rate, it was his view that the Board should grant
its approval, also in the usual manner.
Governors Mills, Shepardson, and Balderston indicated that they
also would be inclined to send routine wires of approval to the Banks
that last week reestablished their existing discount rates. Among
the reasons cited in support of this view were (a) that the sending of
the code telegram approving continuation of the existing rate would
not mean that the Board was abdicating its statutory authority to dictate
the rate if the Board considered such action necessary at any time, (b)
that routine approval of last week's actions by the several Banks would
Seem consistent in the absence of a feeling on the part of the Board
that pressure should be brought to bear upon those Banks, and (c) that
approval would tend to clarify, from a policy standpoint, the relationshiP between the Board and the Reserve Banks with respect to discount
rate changes.
Accordingly, it was agreed unanimously to notify the Reserve
Banks whose directors acted last week to reestablish existing rates of
discount and purchase that the Board approved such action. Pursuant to
this decision, the usual code telegram (IMUOM) was sent following the
meeting to the Federal Reserve Banks of Atlanta, St. Louis, San Francisco,
Neil York, Cleveland, and Richmond approving the establishment without
change of existing rates of discount and purchase at Atlanta on August
5
2258
3/12/57
-9-
at St. Louis on August 6, at San Francisco on August 7, and at New
York, Cleveland, and Richmond on August 8, 1957.
The Chairman then noted that the directors of the Boston Reserve
Bank were to meet today and that they might act to raise the discount
rate of that Bank. In the circumstances, he suggested that if, subsequent
to this meeting, advice should be received from the Boston Bank or from
anY other Reserve Bank having a discount rate of 3 per cent that the
directors of such Bank had established a discount rate of 3-1/2 per
cent) along with appropriate subsidiary rates of discount and purchase,
the Secretary of the Board be authorized to advise such Bank that the
Board approved the proposed rates.
This contemplated that in such
event a press statement would be issued in the usual form, all Federal
Reserve Banks and branches would be advised by telegram of the Board's
action, and a notice would be published in the Federal Register.
This suggestion was approved unanimously.
Secretary's Note: Later in the day telegrams
were received from the Federal Reserve Banks
of Boston, Atlanta, and Dallas stating that the
directors of those Banks had established, subject to review and determination by the Board
of Governors, a rate of 3-1/2 per cent on discounts and advances under sections 13 and 13a
of the Federal Reserve Act, along with appropriate subsidiary rates of discount and purchase.
Pursuant to the authority conferred by the Board,
the Secretary sent to those Banks a telegram
in the form attached hereto as Item No. 13.
Role of branch directors (Item No. 1h).
Governor Shepardson
recalled discussion by the Board several months ago regarding the extent of
2259
8/12/57
-10-
Participation by branch directors in Federal Reserve Bank policy
matters and the possibility of encouraging enlargement of such particiPation.
He proposed that as a first step in determining what might be
done in this direction, a letter be sent to the Chairman of each
Federal Reserve Bank, with a copy to the President, calling attention to
the Board's interest in director activities and requesting as a matter
of information a summary of the steps already taken by the respective
Banks. With such information available, it was his thought that the
subject might be placed on the agenda for discussion at the next meeting
of the Conference of Chairmen of the Federal Reserve Banks.
In response to a suggestion by Governor Mills that such a letter
might have a better reception after the current vacation season,
Governor Shepardson said that although he had envisaged only a collection
Of information at this stage, he would have no objection to deferring
the transmittal of the proposed letter.
Chairman Martin then suggested that the Board authorize the
sending of the proposed letter in the month of September and there was
unanimous agreement with this suggestion.
A copy of the letter is
attached
as Item No. 14.
The meeting then adjourned.
Secretary's Note: Pursuant to recommendations contained in memoranda from appropriate
8/12/57
-11individuals concerned, Governor Shepardson
approved on behalf of the Board on August
9, 1957, the following actions regarding
the Board's staff:
John N. Lyon, from $6,605 to $7,570 per annum, with designation
as Federal Reserve Examiner rather than Assistant Federal Reserve
€bcaminer in the Division of Examinations, effective August 11, 1957.
Susie T. Oros, from $4,890 to $5,065 per annum, with a change
in title from Accounting Clerk to Disbursing Assistant in the Office of
the Controller, effective August 11, 1957.
T
ransfers
Rita D. Brinley, from the position of Clerk-Stenographer in the
Division of Research and Statistics to the position of Secretary in the
Di
vision of Administrative Services, with an increase in her basic
annual salary from $3,755 to $3,940, effective August 11, 1957.
Ann Shuler, from the position of Clerk-Stenographer in the
-vision
Sion of Personnel Administration to the position of Clerk-Stenographer
in the Division of Research and Statistics, with no change in her basic
salarY at the rate of $3,500, effective August 11, 1957.
Xi"
4041k
cretarY
2261
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
Item No. 1
8/12/57
WASHINGTON 25. D. C.
ADORERS OrrIDIAL DORRKBPONOCNCC
TO THC BOARD
August 12) 1957.
Dear Sir:
As you know) the Board has had under consideration a possible
study of small business financing. Several months ago a System group
was requested to explore the feasibility of conducting a research project in this field and a copy of its report is attached.
It is the strong view of the Board that such a study should
be undertaken now. While parts of it might be said to fall outside
the immediate interest of the Federal Reserve System, the Board and
the Federal Reserve Banks are perhaps in a better position to undertake the over-all study than anyone else.
When you were in Washington for the last meeting of tho Federal Open Market Committee, you were given a copy of a letter received
t:rom the Chairman of the Senate Banking and Currency Committee endorsIng a study of the financial problems of small business. The letter
stated that it would be helpful if the Committee could have a report
on the results of the study by March 1, 1958. Although it is recognized that only the first two parts, as contemplated in the attached
report, could be completed by that date, it is felt that the Board and
the Reserve Banks should furnish what information they can within that
time. Accordingly, your comments by September 3 on the nature and scope
Of the study will be appreciated.
Bryan,
In order to expedite the planning of the study, President
Presidents'
the
of
Statistics
and
Research
on
Chairman of the Committee
Conference, concurs in this method of obtaining Reserve Bank reaction to
the proposal.
Sincerely yours)._
S. . Carpenter)
Secretary.
TO THE 'PRESIDENTS OF ALL FEDERAL RESERVE BANKS.
2262
30ARD OF GOVERNORS
Item No. 2
OF THE
FEDERAL RESERVE SYSTEM
8/12/57
WAOHMBTON
CHAS. N. SHEPAROSON
MEMBER
OF THE BOARD
hugust 13, 1957
lir. Lawrence E. Kreider, Assistant Secretary,
The American Bankers Association,
12 East 36 Street,
New York 16, New York.
Dear Larry:
Thanks for your letter of August 6 concerning the
for.+1,
-.Lteoming publication of "Intermediate-Term Bank Credit for
a_i!trmersm.
am happy that you found helpful the few sugges'aens
which we and our colleagues at the Comptroller's office
and the FDIC passed on to you. The copies of your August 6
letter together with the revised Foreword are being forwarded
tm-to Dr. Cramer and to Deputy Comptroller Garwood with the
8_1:ggesti0n that they forward directly to you the formal approval
or their respective agencies, together with any further points
Of View they may have. Also they will send directly to you the
:quired sample signatures together with a request for copies
.
the pamphlet in quantities sufficient for their purposes
The Foreword as now revised has our concurrence here
enclosed
llt the Board. Samples of Chairman Martin's signature are
i
contemmanner
the
in
t
statemen
Your use in reproducing the
Plated.
of the
Regarding your offer to furnish us with copies
1 ar.nAhlet for distribution to our field examiners, we would appre)
ciate receiving here 50 copies which will permit us to furnish
the Reserve
coPy to each of our senior field examiners at
in this office.
use
for
supply
small
a
allow
ial ke and in addition
but
tl,noPe this request is not imposing urduly on your generosity
it
in
interest
Ze importance of this topic and the current
ity to more fully
opportun
this
take
to
reeses me with the need
c'rm our examining people on this subject.
Yours sincerely,
Chas. N. Shep
Enclosure
son.
2263
Item No. 3
8/12/57
FOREWORD
Washington, D. C.
The June 30, 1956 Agricultural Loan Survey administered by the
Federal Reserve System in cooperation with the Office of the Comptroller
of the Currency and the Federal Deposit Insurance Corporation showed that
°ne-third of all bank notes to finance intermediate-term farm investTents had maturities longer than one year. However, renewals of shorter
'erm notes were also used to facilitate many intermediate type investments.
While approximately two-thirds of those shorter term renewals
were reported to have been made on an advanced commitment basis, the
31,1rvey revealed no information as to the adequacy of the planning on
l ich the commitments were based. Other available information indicates
"at, in all too many cases, intermediate-term farm financial programs
are inadequately planned.
It is important that all concerned realize the advantages to
be
from careful farm planning when longer repayment programs
'e expected. In loans of this type, it is generally advisable that a
a!
lan of farm operations for the period of the line of credit become a
ma
part of the loan folder. The plan should include a schedule of
ev?timated income, expenses, and loan repayment capacity, and should pro0 for periodic reviews of the farm financial program.
P
No Federal law or regulation prevents commercial banks from
.7xtending credit to farmers on an intermediate-term repayment basis.
all classes of loans, each loan of this type should be evaluated
aun the basis of its own characteristics -- the risk involved, the charcter, ability, financial responsibility and record of the borrower,
value and character of collateral, and the feasibility and probability
Of
prderly liquidation in accordance—CritfEthe repay-ma-T=7-1It is the belief of the Federal supervisory agencies that
il,Yt'ermediate-term credit by commercial banks on a sound and prudent
contributes greatly to the growth and strength of American agric
ulture.
McC. Martin, Jr.
Chairman
of Governors
Federale
Reserve System
Ray M. Gidney
Comptroller of the
Currency
H. E. Cook
Chairman
Federal Deposit
Insurance Corporation
2264
BOARD OF GOVERNORS
Item No. 4
OF THE
8/12/57
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADORESES OFFICIAL CORRESPONDENCE
TO THE BOARD
August 121 1957
Board of Directors,
The Cleveland Trust Company,
Cleveland 1, Ohio.
Gentlemen:
Pursuant to your request submitted through the
Federal Reserve Bank of Cleveland, the Board of Governors
of the Federal Reserve System approves the establishment of a
branch by The Cleveland Trust Company, Cleveland, Ohio, in a
Shopping center to be constructed at the intersection of
Lorain and Brookpark Roads in the city of North Olmsted,
Ohio, provided the branch is established within one year from
the date of this letter, and approval of the State authorities
is in effect as of the date the branch is established.
Very truly yours,
(Signed) S. R. Carpenter
S. R. Carpenter,
Secretary.
BOARD OF GOVERNORS
OF THE
Item No.
FEDERAL RESERVE SYSTEM
5
8/12/57
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
August 122
1957
Board of Directors
The Union Commerce Bank,
Cleveland 1, Ohio.
Gentlemen:
Pursuant to your request submitted through the
Federal Reserve Bank of Cleveland, the Board of Governors
approves the establishment by The Union Commerce Bank,
Cleveland, Ohio, of a branch at 75 Public Square,
Cleveland, Ohio, provided the branch is established within
six months from the date of this letter, and the approval
of the State authorities is effective at the time the
branch is established.
Very truly yours,
(Signed) S. R
Carpenter
S. R. Carpenter,
Secretary.
BOARD OF GOVERNORS
ootztlet,,4
OF THE
lil
Olia',
--4.7.041,4x,.
"I• r —0,'
FEDERAL RESERVE SYSTEM
wl%
Xg,
Z.A*
Item No.
6
8/12/57
WASHINGTON 25, D. C.
ADORESS OFFICIAL CORRESPONDENCE
TO THE BOARD
August 121 1957
Mr. H. N. Mangels, President,
Federal Reserve Bank of San Francisco,
San Francisco 20, California.
Dear Mr. Mangels:
This refers to Mr. Swan's letter of July 31, 1957,
requesting Board approval for the conversion of two elevators
in your building to self-service operation.
It is noted from your letter that the recommended
Change should result in improved service and an estimated saving of approximately $8,500 per year.
The Board will interpose no objection to the expenditure of approximately $18,000 by your Bank for the conversion
of the two front elevators as proposed.
Very truly yours,
(Signed) S. R. Carpenter
S. R. Carpenter,
Secretary.
BOARD OF GOVERNORS
Item No.
OF THE
FEDERAL RESERVE SYSTEM
7
8/12/57
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
Dear Sir:
The indicated number of copies of the following forms are
being forwarded to your Bank under separate cover for use of State
Inember banks and their affiliates in submitting reports as of the
next call date. A copy of each form is attached.
Number of
Form F.R. 105 (Call No. 145), Report of condition of
State member banks.
Form F.R. 105e (Revised November 1955), Publisher's
copy of report of condition of State member banks.
Form F.R. 105e-1 (Revised November 1955), Publisher's
copy of report of condition of State member banks.
Form F.R. 105e-2 (Revised November 1955), Publisher's
copy supplement.
Form F.R. 220 (Revised March 1952), Report of affiliate
or holding company affiliate.
Form F.R. 220a (Revised March 1952), Publisher's copy
of report of affiliate or holding company affiliate,
All of the forms are the same as those used on June
Very truly yours,
En
closures
S. R. Carpenter,
Secretary,
iC) 74E PRESIDENTS OF ALL FEDERAL RESERVE BANKS
6, 1957.
2268
Item No. 8
TELEGRAM
LEASED WIRE SERVICE
8/12/57
BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
WASHINGTON
August 13, 1957
TO T
?RESIDENTS OF ALL FEDERAL RESERVE BANKS
Lump-sum payment, authorised in Board's August I letter,
to
liquidate accrued liabilities resulting from changes in Retirement
8Yetem benefits should be charged to Profit and Loss account.
(Signed) S. R. Carpenter
Carpenter
2269
BOARD OF GOVERNORS
Item No. 9
OF THE
8/12/57
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
ADDRESS
orriciAL
CORRESPONDENCE
TO THE BOARD
August 12, 1957
Mr. A. Phelan, Vice President,
Federal Reserve Bank of New York,
New York 45, New York.
Dear Mr. Phelan:
Reference is made to your letter of July 29, 1957,
submitting with a favorable recommendation the request of the
Fidelity Union Trust Company, Newark, New Jersey, for approval
under Section 24A of the Federal Reserve Act of an additional
investment of $8,420,000 in bank premises under a purchase
contract extending over a term of fifty years.
The Board of Governors has given consideration to the
investinformation you have submitted and approves an additional
Trust
Union
Fidelity
ment of $8,420,000 in bank premises by the
certain
to
entitled
Company. It is noted the trust company is
credits during the first ten years of the contract which will
reduce its aggregate payments $620,000 and result in a net investment of $7,800,000 over the full term of the contract. If
subsequent estimates indicate the net cost or purchase price will
exceed $7,800,000, it is understood the Board's approval of the
excess amount will be requested by the trust company. Please
advise the trust company accordingly.
Very truly yours,
(Signed) S. R. Carpenter
S. R. Carpenter,
Secretary.
70.::
BOARD OF GOVERNORS
ovatztr tr.,4,4
OF THE
A" 4'
At
*
It **
',. ‘
Item No. 10
8/12/57
FEDERAL RESERVE SYSTEM
'A *
- *
WASHINGTON 25, D. C.
Sr::
ADDRESS OFFICIAL CORRESPONDENCE
TO THE HOARD
,hint „ti°
d:t
August 12, 1957
Mr. John L. Nosker, Assistant Vice President,
Federal Reserve Bank of Richmond,
Richmond 13, Virginia.
Dear Mr. Nosker:
Reference is made to your letter of August 1, 1957,
With regard to the request of The Farmers Bank of Dinwiddie,
Dinwiddie, Virginia, for approval, under Section 24A of the
Federal Reserve Act, of a total investment in bank premises
not to exceed $65,000, in order that the bank may complete a
remodeling of its building.
After consideration of the information submitted,
the Board concurs in the Reserve Bank's recommendation and
approves a total investment in bank premises by The Farmers
Bank of Dinwiddie not to exceed $65,000.
Very truly yours,
(Signed) S. R. Carpenter
S. R. Carpenter,
Secretary.
2271
BOARD OF GOVERNORS
OF THE
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FEDERAL RESERVE SYSTEM
Item No. 11
8/12/57
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
August 12, 1957
Mr. John L. Nosker, Assistant Vice President,
Federal Reserve Bank of Richmond,
Richmond 13, Virginia.
Dear Mr. Nosker:
Reference is made to your letter of August 5, 1957,
with regard to the request of Wachovia Bank and Trust Company,
Winston-Salem, North Carolina, for permission to move its branch
in La Grange, North Carolina, from Main and Railroad Streets to
119 West Railroad Street, a distance of 150 yards.
We concur in your view that the proposal constitutes a
mere relocation of an existing branch in the immediate neighborhood
wlthaut affecting the nature of its business or the customers
served, and, therefore, the approval of the Board of Governors is
not necessary.
Very truly yours,
(Signed)
S. R. Carpenter
S. R. Carpenter,
Secretary.
27A.
BOARD OF GOVERNORS
OF THE
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4,
FEDERAL RESERVE SYSTEM
Item No. 12
8/12/57
WASHINGTON 25. D. C.
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ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
August 12, 1957
Board of Directors,
American Trust Company,
San Francisco, California.
Gentlemen:
Pursuant to your request submitted through the
Federal Reserve Bank of San Francisco, the Board of Governors
approves the establishment of a branch in the vicinity of the
intersection of Farmers Lane and Sonoma Highway, Santa Rosa,
California, by American Trust Company, San Francisco, California,
Provided the branch is established within one year from the date
Of this letter and that formal approval of the Superintendent
Of Banks of the State of California is effective at the time
the branch is established.
Very truly yours,
(Signed) S. R. Carpenter
S. R. Carpenter,
Secretary.
Item No. 13
TELEGRAM
8/12/57
LEASED WIRE SERVICE
BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
WASHINGTON
August 12, 1957
Erickson - Boston
Patterson Atlanta
Irons - Dallas
Reurtel today. Board approved, effective August 13,
Your Bank (a) rate of 3-1/2 per cent on discounts for and
advances
to member banks under Sections 13 and 13a, (b) other
ziatss as set forth in your telegram of today, and (c) establishment
bY Your Bank without change of remaining rates in Bank's existing
schedule.
(Signed) S. R. Carpenter
Carpenter
The
rates referred to in (b) above were as follows:
On advances to member banks under Section 10(b)
for each of these Banks--4 per cent;
On advances to individuals, partnerships, or
corporations other than member banks under last paragraph
of Section 13 for each of these Banks-4-1/2 per cent;
On direct advances under Section 13b, including advances made in participation with financing institutions,
for the Federal Reserve Bank of Atlanta--rates ranging
from 3-3/4 per cent to 6 per cent, and for the Federal
Reserve Bank of Dallas—rates ranging from 4 per cent to
6 per cent.
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
Item No. 14
8/12/57
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
Dear Sir:
For several years the Board has had a continuing interest in
Programs designed to strengthen ties of the boards of directors of the
'various Reserve Banks with the System. Reserve Bank directors play a
i
valuable and constructive part in the operation of the System by servng as the eyes and ears of the banking and business community, and
public generally, in observing its operations. They also serve as
vital listening posts for the System's network of economic intelli?nee. If branch directors are to be able to play these dual roles
O
the fullest there must be the effective liaison with their head
°ffice and with the System operations in general.
Several of the Reserve Banks have taken definite steps in this
direction by providing joint meetings of head office and branch directors
1-ed by providing for the attendance of branch directors at head office
4.,!tings on a rotating basis. Policy statements of the Bank or of the
are usually presented to the boards of directors of the branches.
) n°mic reviews have also been provided as a regular feature of some
—arich office meetings.
4:1
The Board is interested in furthering the participation of
tr›,
ch directors in the discussions of policy matters. To this end,
'
1-1tnsicieration is being giwn to requesting a discussion of this subject
co the next meeting of the Chairmen's Conference. In order to have a
bemPinte understanding of what is now being done at each Bank it would
rra aPPreciated if some member of your staff could prepare a brief sumintf,Y cof the activities of your Bank especially designed to increase the
wh
'
erest of, and participation by, branch directors. Such information
available from all of the Banks will serve as excellent background
dts cmsion at the Chairmen's Conference.
Very truly yours,
S. R. Carpenter,
Secretary.
'113 THE CHAIRMEN OF ALL FEDERAL RESERVE BANKS
((3PY TO PRESIDENTS OF ALL FEDERAL RESERVE BANKS)
@FedFRASER