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112 A meeting of the Executive Committee of the Federal held in the office of the Federal aeserve Board on eserve Board was ednesday, August 24, 1927 at 11:10 a.m. "02ESEIIT: Vice Governor Platt lire Hardin 1.x. James Mr. Cunningham Mr. Eddy, Secretary Mr. M.cOlelland, Asst. Secretary Letter dated August 23rd from the Assistant Federal Ileserve 4-ent at 140 York, advising that the 1,:anufacturers and Traders - Peoples Trust Company Of Buffalo, N. Y. has received permission from the State Banking Department to open and maintain a branch, on and after September 1st, at 3184-3166 n Street, Buffalo, N. Y. Noted. Letter dated August 23rd from the Assistant Federal deserve Agent at i:ow York, advising that effective as at the close of business August 6th, the Bank of the Manhattan Oompanj, New York City, absorbed the Bank of 'leshinton Heights, the former main office and three branches of the Bank Of Washington Heights new being operated as brauches of the Bank of the anhattan Company. Noted. Letter dated August 17th from the Assistant Federal _deserve Agent at 8a1 Francisco, advising that the American Trust Company, at the close of business Au;-.:, ust 6th, removed the branch formerly operated at 495 California Street San Francisco, to 251 Montgomery Street. Noted. Letter dated August 17th from the Federal aeserve Agent at Jan 113 8/24/27 -2- Francisco, transmittin-; and recommending approval of an application of the American 2rust Company, San Francisco, for permission to remove the 1Sranch formerly operated at 2owel1 and .;utter Streets to a new location at 345 Powell Street - corner of Post and Powell Streets. ::oted with approval. ..eport of Committee on Examinations on letter datea August 16th from the Federal deserve Agent at San Francisco, transmittin and recom- tienaine: approval of an 'application of the American Trust Company of San Francisco for eriision to establish a branch at 3600 Balboa Street, San Francisco; the Committee also recommending approval. 1.oted wi,th acroval. deport of Committee OA _]::aminations on letter dated August 16th from the federal deserve Agent at Jan Francisco, transmitting and recommendin7 approval of an application of the American Trust Company of San Francisco, for Permission to establish a branch in temporary quarters at 1050 I2araval Street, San Francisco, oenainr; the construction of penaanelit quarters at 101 Taraval Street; the Committee also recommending approval._ roted with approval. deport of Executive Committee on letter dated August 19th from the Comptroller of the Currency, recommending approval of an increase from d5'600 to ,8,000 per annum in the salary of Mr. A. P. Leyburn, who is A boi4- appointed Chief liaional Dank _;xaminer of the Fourth Federal ;ieserve Di2triet, effective Je-otembor 1, 1927; the Committee also rocamendin!-; proval. 114 8/24/27 -3- Aeport of Executive Committee on letter dated Aumst 17th from the Comptroller of the Currency, recommending approval of increases in the salaries of National Bank Examiners, as follows: J. 2. ',:anberg, jilliam Taylor, K. S..French, John IF. Utt, R. IC. Stuart, ..;4100 3900 2700 2700 5000 to „;4300 per annum to 4200 per annum to 3300 per annum to 3000 per annum to 5400 per annum Upon recommendation of the Committee, the above increases were approved. Aeport of Executive Committee on letter dated August 19th from the ct Ln.:5 Comptroller of the Currency, recommending approval of increases 14 the salaries of the following National. Bank Examiners: a. W. Kane, Jr., Hodgson, a. M. 1;3600 to 4000 per annum 6500 to 7500 per annum Upon recommendation of the Committee, the above increases were approved. .eport of Committee on Salaries and Expenditures on letter dated 411.gist 19th from the Secretary of the Federal 2:eserve Bank of Cleveland, requestinc approval of the action of the Executive 'Committee of that ban votinc7 to ,;rant leave of absence, with full pay, for a period of three months, from July 5th, on account of illness, to Elizabeth O. Kemp, an, employee of the 2ayroll Derartment;. the Board's Committee recommending approval of the salary payment involved. 4proved. ileport of Committee on Examinations on memorandum dated August 2fla from r. Black, with respect to the recent examination of the State Barik of liadelia, ;ann. made as at the close of business July 12, 1227, 115 -4_ 8/24/27 ta which he participated; the Committee concurring in the recommendation contained in Black's memorandum, based upon the exmination referred to, that the Board now approve the action of the State Bank of ],:adolla • in absorbing the First National Bank of ade1ia iithout first securing the permission of the Board. Upon motion, it was voted to approve the consolidation in question. Letter dated AuL;ust 15th from the Federal deserve ,Ls'ent at Atlanta, With reference to the Application for membership in the Federal Aserve stem, :lied by the Fanners Bank of 2,oyston, Ga., which was approved by the -oard on February 14th, and to the Board's action of Lay 17th in grantiw; an extension of 90 days in the time in which the bank might accept tho coudi;ion_ of membership imposed upon it by the Board; the Agent advising that the 2armers Basik of Royston, Oa. has not up to this time accepted the conditions of membership. Upon motion, it was voted that the 7.1oard's approval of the afplication of the Royston Bank for membership in the System be rescinded, with the understanding that a new application will be required in the event the bank should later wish to enter the ,ystem. L.omoralidAlm frml the Di7i:ion o: ixamination on letter dated Iluust 5th ...-rom the Federal .3servo-.5f . int at ILtlanta, advising that he has been ilnablo to secure af21ication for surrender of Federal Reserve bank stock fro;r, theLiquidating .anittoe of the First rational Bank of Athens, lila. which institution was placed in voluntary liquidation effective JanaarY 11, 1927; the memorandum concurrin in a recommendation of the 116 SA4127 -5- edoral Aeserve gent that the Board issue an order cancelling the fifty shares of stock in the Federal :Lieserve Bank of Atlanta outstanding in :1•e name of the First National Bank of Athens, in accordance with the 9rovisions of 2egulation I, 'eries of .1924. Upon motion, the recommendation of the Federal lieserve .;;ent was approved and the stock of the batk in question was ordered cancelled. Liemorandum from Counsel dated ..ugust 22nd, with reference to the Clayton ,I.ct application of 1r. Marshal Hale, involving the California National Bank of Jacramento, Cal. and the Bank of Italy National Trust and Savings Association of San Francisco, which latter institution has two branches in 3acralaen.to, within a few blocks of the California .LicAtional Bank; .)o-,insel recommending (1) 2hat the Board temporarily refuse the a_Yoliction; (2) That the applicant be advised that on the evidence before it the 3oard can not 1).rmit him to serve tne„se institutions but that he may, if he wishes to do so, furnish the )oard with additional if.formuzion; and (3) That the time within which the applicant shall notify the 'Board whether he desires to furnish additional information be limited to t.:enty days, with the understanding that if the Board is not notified within that time its refusal will become final. Upon motion, the recommendations of Counsel were approved and the application above referred to was temporarily refused. The Secretary then presented a letter dated _.tlust 11th from the • .ederal ..-,eserve at Atlanta, inquiring as to the Board's action on an application for permission to exercise fiduciary powers filed by the 117 8/2V27 l'irst National Bank of Perry, Fla. The Secretary also presented a memoran- dum bearing upon this application, action on which has been deferred pondtag adeption by the Board of a policy with respect to the granting of fi, . (11101a 1 Y powers to National banks in Florida where the State Bank Commissioner recuires a capital of 100,000 and a paid-in surplus of ..450,000 for the orcranization of a trust company. Upon motion, it was voted to refer the question of policy mentioned in the Secretary's memorandum, as well as the fiduciary application of the First National Bank of Perry, to the Law Committee for recommendation. Let,tc dated Alu:ust 20th from the Assistant Federal lieserve 2i.-,.ent at Dallas, with reference to .the cancellation of stock in the Federal .leserve II/ Bank of Dallas issued to the First State Bank, :tormanee, Texas; the -ssistant Federal ioServe Agent statinT7 that the charter of the First State 3ank of I:ormangee expired on December 29, 1926, without notice to the Pedeal Aeservo Bank, and that the institution operting under the new charter does not desire membership in the System. lieferred to Counsel. liemoranduri from Counsel dated.L.ugust 17th, submitting draft of letter to the First Federal Foreign Investment rast and circular letter to all Federal Aeserve banks advisinr; of the amendment to Paragraph B of Section 11 °f ,iegulationI, approved by the Board on Aw;ust 11th. Upon motion, the above letters were approved and ordered transmitted. :emorandam from Counsel dated August 17th submitting draft of reply to 1°ttcJr dated Lust 5th from the Federal eserve sil.gent at Boston, with r3fr- °nee to the surrender of certain Federal Heserve Lank stock by the ,orcester 118 8/24/27 County'NationPLBank of "Jorcester, 2.1assachusetts, which is a consolidation Of the L:erchants National Bank of : - lomester, and the Fitchburg Bank and Trust Company of Fitchburg, Liassachusetts; the Agent having advised that prior to the consolidation the Fitchburg Bank and ?Just Company reduced ,its surplus ,)200,000 but elected to retain the Stock to which it had subscribed on the '.)asis of this surplus, and further, that the surplus of the consolidated bank is :300,000 less than the combined surplus of the two consolidating institutions at the time of the consolidation. he -pro- Posed reply submittVd by Counsel stated that the Board is of the opinion that the 'dorcester County National Bank is not required to surrender any Of its Federal Joserve.bank stock either on account of the reduction Which took rilaCe in the surplus of the Fitchburg Bank and Trust Company prior to the consolidation or on account of the reduction in surplus which took place at the time of the consolidation. Upon motion, the proposed letter submitted by Counsel was approved. emorandum from Counsel submitting draft of letter to the Supervising ileeeiver, office of the Comptroller of the Currency, referring to his letter of July 2nd with regard to Federal Aeserve banks ol;enin_; accounts ,with examiners in charge of suspended ITational Banks; the letter tfaasLlitting copy of a communication received from the 'Federal -esarve Bank Of Jan Francisco, to which the matter was referred, and inquirin- whether - rancisco bank would be satisfactory an arrangement outlined by the Jan F to the Comptroller's office. Upon motion, the proposed letter was approved . 119 8/211/27 -8- Letter dated August 22nd from the Secretary of the Fed:Oral Advisory advisin,; of topics whicifhave been suggested for discussion at the next meet inc: of the ;ouncil, to be held in aashington on 2riday, Jeptemwhether the Board has any topics which it wishes ber 16th, and to place upon the program for the Joancil meeting. After discussion, the above letter was referred to the Vice Governor for the preparation of a reply. Letter dated August 17th from the President of the United States 1;atienal Bank, Denver, polorado, transmitting copy of resolutions adopted by the Clearing House Associations of Denver, 'Wichita, Tulsa, Omaha and Kansas City, requesting that the Federal Reserve Bank of Kansas City and its branches be permitted to discontinue the handling of non-cash collection items. Ordered circulated and. filed. 1.:atter approved on initials on AuEust 19th, namely, letter dated ,A.ugust 17th, from the federal deserve A.:,ent at Jhicago, requestilx, the designation of Lr. Eimond J. .4,uandt, as alternate during the absence of John F. Billig, to act as representative of the Federal aeserve Arzent at the Detroit Branch to receive, endorse and release collateral to Pederal deserve notes. Formally approved. L:atter approved on initials on Au.t:ust 19th, namely, letter dated August 18th from the Governor of the Federal Aeserve Bank of New York, reaues,tinc; approval of the action o: the Board of Directors of that bank in authorizing the officers to 0p311 an account for the Austrian National 120 8/24/27 -9- Bank, Vienna, to establish a relationship with that bank along the same general lines as arranE;ements with other foreiGn central banks and to appoint the bank as agent and correspondent of the Federal :?.eserve Bank Of "cow York in return for a similar appointment from it. Ye nally approved. Letter dated August 22nd from the Deputy Governor of the Federal .deserve Baak of New York, transmitting copy of letter addressed to the Austrian 1:ational Bank, outlining the terms of that bank's appointment a8 agent and correspondent of the Federal Heserve bank. 1:oted. ;ust 13th, namal:/, reply to 2roved on initials on .:.u, ::atter a; telegram dated 'august 17th from the Federal Reserve 11.7;ent at San Francisco, With reference to the arrest of John J. Orownover, folw.erly assistant teller of the Security Trust and Javin s Bank of Los Angeles, who is charged with the theft of A2,000, and inquiring whether report to the United States District Attorney should be made on the basis of information Obtained throuh the press or deferred until firsthand information can be obtained throurji examination; the telegraphic reply stating that an examiner of the Federal .ieserve bank should visit the Security Trust and Savings Bank for the purpose of ascertaining the basis of charges made against Lr. Crownover and that the examiners findings should then be reported to the local United States District Attorney. Formally approved. 121 8/24/27 -10- Report of Committee on Examinations on letter dated ust 16th from the Federal _teserve Agent at Boston, transmitting and recommending ..approval of an application of tl..o ._;:chane Trust Company of Boston, for permission, under special legislative authority, to increase the amount Of its investment in real estate, said increase beinç in connection with the construction of a new bank build;; the Committee recommending approval of the application. .a.-oproved. :.-.emorandum from Counsel dated Lugust 17th on letter dated July 12th from the Chairman of the Federal eserve Bank of .;Ltianta, submitting for the Board's approval the action of the directors of that bank in inf.; fees for L.:essrs. ...andolph and Parker, regular Counsel, and for :lessrs. (3111ith and Vertrees, local Counsel, in connection with the case of the L & N ldailroad. Company against Nashville Branch of the Federal ...eserve Bank of i.tlanta; Counsel recommending approval of the fees voted by the 41.tlanta directors, namely, A500 for each firm of attorneys, said fee aovJvin- their entire services in the case, including trial before the jupreme Court of the United itates. Upon motion, the action of the .Ltlanta directors was approved. Draft of reply, prepared by Counsel, to letter dated august 8th from the 2irst Federal Forei7a Investment Trust with regard to the information which that corporation is required by the terms of _legalation K to file with the Board within ten days after the issuance of any debentures, bonds, notes or other obligations. clo 8/24/27' -11- Upon motion, the above letter was approved. Memorandum from Jouhsel dated Au-;ust 23rd, submitt!nr: draft of reply to letters dated AlurAlst 4th and 22nd from the l'irst :ederal Foreign Investment '.1rust, .inquiring as to the ric,ht of that corporation to act as cotrustee for an issue of foreign bonds which will be parchasod half by the corporation and half by another corporation in the United Jtates; the proposed reply stating that upon the basis of the facts before it the Board is of the opinion that the exercise of the function described ITIV properly be construed as incidental to the foreign business of the cor ,oration. AnproVed. Letter dated August 18th from the .e.ssistant Jecretary of• the 2edera1 _:esorve Bank of New York, advisinf-: that the board of directors at their meeting on that date made no change in the bank's existing schedule of rates of discount and purchase. Noted. Telegram dated August 22nd from the Assistant 2ederal Aeserve agent at New York, advisLa' of the establishment of a rate of 3i, for Purchases of bankers acceptances with maturities from one to 45 days; ,the Zssistant gent advising that all other rates for purchases of acce-otances remain unchanged. Noted, with approval. Telegram dated Aur:ust 17th from the Assistant Federal eserve 4,-.„ent of the 2.ederal .esorve Bank of Philadelphia, advising that the 123 8/24/27 -12- board of directors at their meeting on that date made no change in the bank+ s existin: schedule of rates of discount and purchase. Noted. ust 19th from the Chairman of the Federal -eserve '2e1egram 4ated Malik at Jhicaco, advisin that the board of directors at their meeting on that date made no chan;e in the bank's existing schedule of rates of discount and purchase. Telegram dated L.0 ust 16th from the Chairman of the Federal deserve Balik of .;an Francisco, advising that the board of directors at their meeti_l_ 04 at date made no chanr:e ih the bank's existing schedule of rates of dis- count and purchase. Noted. The Vice Governor then presented letters date Luust 15th, 16th and 19th from the Joveraor of the Federal .?esorve Bank of New York, with reference to conditions in the money market, transactions in the open inarket investment account, and changes in the London account of the bank clue to the sale of 3terling. Noted. _o ort of Committee on E74aminations on the matter referred to GilL)rt at the meting on uust 17th, namely, application of the National Loar and _.;:chanr_:e Bank of _olurabia, 3. C. for permission to accept drafts and bills of exchane up to 100,) of its paid-in and unimpaired capital 44d sur2lus; the .)ormittee submitting an analysis of the last report of ezamination of the applicant bank, prepared by :Ir. Gilbert, and recommending 121 8/24/27 -13- approval of the application be withheld. Upon motion, it was voted to withhold approval of the application pending another examination of the Ilational Loan .and Exchange Bank. The Vice Governor then aabmItted a draft of a statelnont for the press setting forth the personnel of the directorat,) of the Branch of the Fe-eral ileserve Bank of Aichmond to be established at Charlotte, N. C. -1)proved. Informal discussion then ensued of the rediscount rate policy and the 'possibility of a discussion thereof appearing in the Aaview of the Month la the forthcoming issue of the Federal deserve Bulletin. Following the discussion, it was voted that should the subject he given a place in the Review of the Month, and particularly should the Aeview be released to the press in advance of the regular distribution of the Bulletin, all members present at this meeting would vote in favor of any pablished discussion of the subject of rate adjustments which may be unanimously approved by the members of the Board present when said discussion is presented for approval. 1IEPOTS' OF 3'1,111)I-.-•:C; CO=ITTEES: Aeconmending changes in stock at Federal Aeserve Banks as set forth in the Auxiliary Minute Book of this date. Lpproved. Dated, .August 17th, Recommending action on applications for fiduciary 19th, powers as set forth in the Auxiliary Minute Book of this date. _iecoramenclations approved. Dated, Lugust 20th, Recommending action on application for admission of state bank, subject to the conditions stated in the individual report attached to the application, as • set forth in the Auxiliary Minute Book of this date. ;iecommendation approved. Dated, Aar:dst 15th, Aecommending approval of the application of Mr. Michael F. Dooley for permission to serve at the same time as director of the First National Baa%, JIttlebore, Liass. and as director of the Industrial Trust Company, Providence, A. I. itecormendation approved. Dated, AuL:ust 20th, 22nd, 24th, 125 8/24/27 -14- 1..0 (Cont'd) Dated, 4.up:ust 15th, Dated, -u ust Dated, ,uL,ust Dated, -u ust - ated, 2,1sust D , 2.u;ust _lecommendin- anproval of the anplisation of Dr. .Crederick B. Peck for permission Uo servo at tie same time as director of the first :rational ;;an'.‹., Lttleboro, ::ass. and as director of the Industrial Trust Company, Providence, J. I. recommendation approval. 22nd, aecommondin approval of the azlic-ti)n of Lr. Denman Xountze for permission to serv3 at the same time as director and officer of the first National Bank, Omaha, Nebraska and as member of the firm of private bankers of r:ountze Brothers, ..:aa York, Y. Recommendation approved. 20th, .ecOmmending approval of the application of Lr. Theodore ,;tempfel for permission to serve at the same time as director and officer of the Fletcher American 1:ational Balk, Indianapolis, Ind., as director of the Indianapolis Joint itock Land Bank, Indianapolis, Ind. and as director of the Belmont s..)tate Bank, Indianapolis, Ind. .ecommendation approved. 20th,ecommen,., .in;s approval of the application of Lr. Jharles 3. 3ommers for permission to serve at the same time as director of the A.etcher nerican :ational Bank, Indianapolis, Ind, and as director of the Indianapolis Joint itock Land Bank, Indianapolis, Ind. 2.ecommen,ation approved. 2,ecommendin4 approval of the apthcation of 1r. 20th, Gustav H. 2:ueller for permission to serve at the - letcher same time as director and officer of the f .1morican "National Bank, Indianapolis, Ind., as director of the Indianapolis Joint 3tock Land Bank, Indianapolis, Ind. and as director of t:IeLadison -venue 3tate Bank, Indianapolis. Ind. _ecommendation approved. 20th, -;ecom:f.leudinr: approval of the a Tlication of _amer d. .;-tout for permission to serve at the same time as director and officer of the "fletcher • Lmerican :Tational Bank, India-apolis, Ind., as director of the Indianapolis Joint itock Land Bank, Indianapolis, Ind, and a:- director of the elmont itate 'Bank, Indianapolis, Ind. aecommendaLion approved. 126 (11,23 (Uont'd) OF Dated, ist 20th, rJ, approVal of the app1iction of r. ilorrey, Jr. for permision to serve at same time as director and officer of ti;a 171etcher L.wrican ilational 3ank, Indianapolis, as director of the Indianapolis Joint itoek '3ank, Idilis, Ind. and as director of the Belmont Sta!, sank, Indianapolis, Ind. Eecommendat ion approved. 000 The meting adjourned at 1:00 APProved: Vice Clove or.
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