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609
Minutes for December 1, 1965
To:
Members of the Board
From:
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 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
Gov. Maisel
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Minutes of the Board of Governors of the Federal Reserve
System on Wednesday, December 1, 1965.
The Board met in the Board
Room at 10:00 a.m.
PRESENT:
Mr.
Mr.
Mr.
Mr.
Mr.
Martin, Chairman
Balderston, Vice Chairman
Robertson
Mitchell
Maisel
Mr. Sherman, Secretary
Mr. Kenyon, Assistant Secretary
Mr. Young, Senior Adviser to the Board and
Director, Division of International Finance
Mr. Solomon, Adviser to the Board
Mr. Molony, Assistant to the Board
Mr. Cardon, Legislative Counsel
Mr. Fauver, Assistant to the Board
Mr. Hackley, General Counsel
Mr. Brill, Director, Division of Research
and Statistics
Mr. Farrell, Director, Division of Bank Operations
Mr. Johnson, Director, Division of Personnel
Administration
Mr. Kakalec, Controller
Mr. Hexter, Associate General Counsel
Mr. Shay, Assistant General Counsel
Mr. Smith, Associate Adviser, Division of
Research and Statistics
Mr. Sammons, Associate Director, Division of
International Finance
Mr. Irvine, Adviser, Division of International
Finance
Mr. Kiley, Assistant Director, Division of
Bank Operations
Messrs. Goodman, Leavitt, and Smith, Assistant
Directors, Division of Examinations
Mr. Bass, Assistant Controller
Mr. Morgan, Staff Assistant, Board Members' Offices
Mrs. Heller and Messrs. Heyde, Smith, and Via
of the Legal Division
Messrs. Egertson, Lyon, and Noory of the Division
of Examinations
Mr. Smith, Economist, Division of Research and
Statistics
Mr. MacDonald, Cashier, Cincinnati Branch,
Federal Reserve Bank of Cleveland
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Discount rates.
The establishment without change by the Federal
Reserve Bank of Atlanta on November 29 and by the Federal Reserve Bank
of Minneapolis on November 30, 1965, of the rates on discounts and advances
in their existing schedules was approved unanimously, with the understanding that appropriate advice would be sent to those Banks.
Branch application (Item No. 1).
As recommended in the file
that had been circulated, unanimous approval was given to a letter to
The Union Commerce Bank, Cleveland, Ohio, granting an extension of time
to establish a branch at East Ninth Street and St. Clair Avenue.
A
copy of the letter is attached as Item No. 1.
Report on competitive factors (Greenwood -Newberry, South
Carolina).
Unanimous approval was given to the transmittal to the
Federal Deposit Insurance Corporation of a report, in which the conclusion read as follows, regarding the competitive factors involved in
the proposed merger of Newberry County Bank, Newberry, South Carolina,
into State Bank and Trust Company, Greenwood, South Carolina:
Consummation of the proposed merger of State Bank and
Trust Company, Greenwood, and Newberry County Bank, Newberry,
would eliminate some competition between them. While the
proposed merger would not significantly alter Greenwood
Bank's Statewide position or its competitive capacity in
relation to the other large banks in South Carolina, it
would expand its geographical coverage into two additional
communities and an additional county in the western section
of the State, eliminate one of the two banks headquartered
in Newberry County, and further the trend toward concentration of banking resources in South Carolina.
The overall effect of the proposed merger on competition
would be adverse.
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Application of Greenfield Banking Company (Items 2 and 3).
There had been distributed a proposed order and statement reflecting
the Board's approval on November 17, 1965, of the application of
Greenfield Banking Company, Greenfield, Indiana, to merge with The
First National Bank of Fortville, Fortville, Indiana.
The issuance of the order and statement was approved unanimously;
copies of the documents, as issued, are attached as Items 2 and 3.
Application of BancOhio Corporation (Items 4 and 5).
There had
been distributed a proposed order and statement reflecting the Board's
approval on October 11, 1965, of the application of BancOhio Corporation, Columbus, Ohio, to acquire up to 100 per cent of the voting shares
of The First National Bank of Jackson, Jackson, Ohio.
In discussion, two questions were raised concerning the proposed statement.
The first was whether to retain language included in
the draft relating to the views on the subject application that had
been submitted by the Department of Justice.
On this question Mr.
O'Connell referred to the civil investigation demand that had been
served on BancOhio several months ago in connection with an antitrust
investigation being conducted by the Department.
He pointed out that
the language proposed to be included in the Board's statement would
had
serve the purpose of identifying in the record that the Department
r
refrained from making an adverse recommendation on this particula
on
application, its only suggestion being that the proposed acquisiti
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might serve as a precedent or set a pattern for future expansion.
The
Board's statement would bring out that this was not considered to be
a significantly adverse factor as the Board constantly had taken the
position that each holding company or merger application must be considered on the basis of the pertinent facts presented and that the
decision by the Board in the given matter therefore would not constitute any commitment on future applications.
Thus, Mr. O'Connell felt
that the record would be stronger if the statement showed that the
views of the Justice Department had been considered.
Agreement was
expressed with Mr. O'Connell's reasoning, and it was understood that
the language would be retained in the statement.
The second question was whether to retain in the statement a
family's
sentence indicating that information submitted on the Wolfe
was
banking interests in the City of Columbus and in Franklin County
not viewed by the Board as demonstrating that the acquisition of the
bank in Jackson, located 75 miles from Columbus, created an anti-competitive situation or an undue concentration such as to require denial
of the proposed acquisition.
After discussion it was agreed to delete
this reference as an alternative to discussing the subject of the Wolfe
family banking interests in more detail in the statement.
an
Accordingly, unanimous approval was given to the issuance of
discussion.
order and statement reflecting the results of the foregoing
as Items 4
Copies of the order and statement, as issued, are attached
and 5.
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Membership dues and contributions (Item No. 6).
By letter dated
October 27, 1965, Chairman Patman of the House Banking and Currency Comof
mittee requested that listings be prepared, for the considerstion
the Committee, of all dues and contributions made by each of the Federal
rs from
Reserve Banks and their branches and by the Board of Governo
January 1, 1962, through September 30, 1965.
The listings were to show
along
the date, amount, and name of payee for each such disbursement,
with the purpose and rationale for each such disbursement.
were
Upon receipt of this request the Federal Reserve Banks
Governors for
asked to supply appropriate information to the Board of
transmittal to Chairman Patman.
The Banks thereafter submitted such
memorandum from the
information, and there had now been distributed a
summarizing the
Division of Bank Operations dated November 24, 1965,
replies.
ed approxThe memorandum brought out that the replies present
were included in the
imately the same picture as the 1961 listings that
Currency Committee in
record of hearings before the House Banking and
1964.
n Bankers AssoFor example, all Banks contributed to the America
ciation, NABAC, and State banking organizations.
The American Institute
branch, except Seattle,
of Banking was supported by each Reserve Bank and
facilities available to
to the extent necessary to make the educational
System employees.
hip
Only one Reserve Bank (Atlanta) reported members
in service clubs.
Its rationale included the statement that such
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memberships had been considered by the Board of Directors of the
Reserve Bank and also by the Board of Governors and were believed by
them to be obligatory on certain of the principal Reserve Bank officers.
The reference to the Board of Governors was considered by the Division
of Bank Operations to be of doubtful validity.
In a distributed memorandum dated November 29, 1965, the Office
of the Controller submitted a list of payments by the Board that appeared
to fall within the categories mentioned by Chairman Patman.
m
In a discussion of the matters referred to in the memorandu
ations
from the Division of Bank Operations, including the represent
past conmade to the Board by the Atlanta Reserve Bank at times in the
in service
cerning the payment by the Reserve Bank of membership dues
accord
clubs, it was suggested that it would be preferable and more in
approved
with the record to say that membership in such organizations was
the
by the Board of Directors of the Reserve Bank after discussion with
Board of Governors.
There was agreement that a revision of this kind
in the report by the Atlanta Bank would be appropriate.
its
Mr. Farrell also noted that the Dallas Bank had listed in
report contributions to the Bank's employee club.
The other Reserve
were considered
Banks had not included such contributions because they
res.
to fall within the category of employee welfare expenditu
After
and in the interest
discussion it was agreed that it would be appropriate
employee club from
of consistency to delete the contributions to the
the Dallas Bank's report.
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Subject to the aforementioned changes, it was understood that
the listings received from the Reserve Banks would be transmitted to
Chairman Patman.
Secretary's Note: Attached as Item No. 6
is a copy of the transmittal letter to
Chairman Patman dated December 8, 1965.
There had also been distributed copies of a memorandum from
Governor Mitchell to the Division of Examinations dated March 31, 1965,
based on his review of a draft memorandum from the Division dated
February 23, 1965, concerning "discretionary expenditures" of nine
Federal Reserve Banks.
Governor Mitchell's memorandum pointed out
that such expenditures were small in the aggregate in relation to the
was
Reserve Banks' total expenditures, but that the essential question
one of propriety.
He suggested that there should be a consistent set
of discretionary spending guidelines for the Board and the Reserve
Banks.
Therefore, for purposes of discussion, he classified such expen-
; and
ditures into (1) those affecting employees, officers, and directors
(2) those affecting outsiders (banks, corporations, educational institutions, associations, and individuals).
He then broke down these two
s
principal categories into several subcategories and suggested guideline
that might be used for each subcategory.
The subject was discussed some-
November 19,
what further in a distributed memorandum from Mr. Solomon dated
consideration to
1965, which suggested that the Board might want to give
primarily
the question of membership dues in organizations that were
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professional, research, or educational as compared with organizations
that were essentially trade associations.
In discussion of Governor Mitchell's memorandum the suggestion
was made that copies be distributed to the Conference of Chairmen of
and
the Federal Reserve Banks (meeting at the Board's offices tomorrow
r
Friday) with the thought that the Chairmen might be asked to conside
the matter and give the Board the benefit of their views.
After certain
in Governor
suggestions had been made, and accepted, for minor changes
proposed proMitchell's draft memorandum, it was understood that the
cedure would be followed.
Mr. MacDonald withdrew from the meeting at this point.
Bank merger legislation.
A distributed memorandum from Messrs.
Treasury had
Cardon and Shay dated November 29, 1965, reported that the
mergers,
been trying to develop an amendment to S. 1698, relating to bank
and Currency
that could be presented to the Chairman of the House Banking
Committee as an Administration proposal.
The Board's views had been
was attached
requested on a draft of proposed legislation, a copy of which
in
to the memorandum, revising the standards to be taken into account
passing on bank mergers.
The Board's views also had been requested on
whether the
what, if anything, the bill should provide with respect to
tic injunction"
filing of an antitrust suit should serve as an "automa
to stay consummation of an approved merger.
passing on
The attached draft relating to the standards for
among staff
merger applications had been prepared after consultation
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representatives of the Treasury, the Federal Deposit Insurance Corporation, and the Federal Reserve.
The staff participants believed that it
represented an improvement over the "reported" version of S. 1698 in
two respects.
First, it eliminated the provision of the Ottinger amend-
ment to that bill that would require the responsible banking agency to
determine whether or not a proposed merger violated the antitrust laws.
Second, it eliminated another provision of the Ottinger amendment that
would seem to narrow the grounds for approval of a merger that had any
adverse competitive effects.
The attached draft would make it clear
that in weighing the advantages of a merger against its adverse competitive effects, financial and managerial resources and future prospects
could be considered as well as the nature and extent of services provided.
A merger transaction that would result in a monopoly of any part
of the trade or commerce among the several States (a result prohibited
by section 2 of the Sherman Act) could not be approved by a banking
agency under the attached draft, but this was regarded as a reasonable
restriction.
Also, the attached draft would require courts, in suits
instituted under the antitrust laws challenging the bank merger approvals,
to apply the same standards as the bank supervisory agency had applied
in passing on the merger application originally.
It was recommended that the Board authorize its staff to advise
the staffs of the Treasury and the Federal Deposit Insurance Corporation
informally that the Board would favor (1) an Administration proposal such
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as that contained in the attached draft as representing a marked improvement over the Ottinger amendment to S. 1698 as reported, and (2) the
Provision in the House-reported version of S. 1698 that the institution
of a court action within the 30-day period following approval of a bank
merger by the responsible agency would continue the stay of consummation
of such a merger "unless the court shall otherwise specifically order."
In commenting on the matter Mr. Cardon pointed out that the
Board did not have before it in this connection any question of forgiveness of past mergers.
He and Mr. Shay had been informed that the
Secretary of the Treasury was deferring to the Department of Justice on
that question.
If so, it appeared that whatever the latter said would
in effect constitute the Administration position.
Mr. Cardon understood that the General Counsel of the Treasury
as
had given to the Secretary of the Treasury a copy of the same draft
not
attached to the November 29 memorandum, but that the Secretary had
yet commented.
Likewise, the General Counsel of the Federal Deposit
the latter
Insurance Corporation had given Chairman Randall a copy, and
had not yet commented.
If the Treasury, the Board, and the Corporation
was
all could agree on this draft, or some different version, the plan
would
then to go to the Department of Justice to see if the Department
agree as well.
by
Following additional comments on the proposed legislation
the whole effort
Mr. Shay, Governor Mitchell expressed the view that
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involved an attempt to use semantics to try to cover up irreconcilable
The bank supervisory agencies then would be left with a
positions.
bill that it would be almost impossible to interpret for administrative
purposes.
Personally, he had never been happy with the injunction given
by statute for application to merger cases because it required unnecessary work and unnecessary bureaucratic intervention in a process that
ought to be principally the prerogative of private parties.
Accordingly,
he had drafted an alternative proposal of his own, as follows:
(5) The responsible agency shall approve a proposed
merger transaction unless it finds that such transaction
would not be in the public interest because it would have
a significantly adverse effect on competition, or a tendency
toward monopoly.
However, in cases where the probable effects on competition are significantly adverse and the responsible agency
finds that the bank's capital position, earnings prospects,
management, or service to the community are such as to establish
doubts as to the bank's viability or competence to serve the
community, the agency may approve the merger if, in its judgment, the adverse competitive effects are clearly outweighed
by the considerations related to the bank's survival and service
to the community.
Governor Maisel commented that the Ottinger amendment to
S. 1698 seemed to involve a clear change in the philosophy of bank
merger legislation, and therefore he would support the draft legislation referred to by Messrs. Cardon and Shay as compatible with existing
philosophy.
Chairman Martin then inquired of the members of the Board as
to their views regarding the best way to handle the matter referred to
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by Mr. Cardon, and Governor Robertson said there seemed to be two posThe first was the one being followed, namely, to see
sible approaches.
whether the several interested agencies could work out a compromise that
the Administration could inject into the Congressional debate and perhaps
get approved.
The other approach was to do nothing at this stage on the
ground that one could not tell what would happen regarding bank merger
legislation.
Whatever bill was brought up, the Board and the other
agencies no doubt would have to comment at that time concerning it.
It
seemed to him in keeping with good Governmental practice to try to develop
an approach that would be generally agreeable to the administering agencies.
In his opinion the proposal attached to the Cardon-Shay memorandum
was a good job.
His only suggestion would be to delete the word "sub-
stantially" from the following sentence:
"No merger transaction shall
be approved by the responsible agency where it finds that such transaction would have a substantially adverse effect on competition, except
that such transaction may be approved where the responsible agency,
taking into account factors (A) through (E), finds that the convenience
and needs of the community clearly outweigh the probable adverse effect
on competition."
Otherwise, he found no reason to object to the attached
draft as a basis for an attempt to obtain an agreement among the agencies.
Asked whether he would also be willing to eliminate the word
"clearly" from the sentence to which he had referred, Governor Robertson
said he would not.
of proof.
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He would continue to put on the applicant the burden
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-13After some further discussion of the language in the draft,
Chairman Martin said he agreed with Governor Robertson that it was
appropriate to try to get the interested agencies together.
Every
effort should be made to see if a mutually agreeable position could
be worked out.
Governor Balderston indicated that he would be willing to go
forward with further negotiation on the basis of the draft as it stood.
Thereupon, it was decided to proceed on the basis of the recommendations contained in the Cardon-Shay memorandum, Governor Mitchell
dissenting.
Request for technical assistance (Item No. 7).
A distributed
memorandum from Mr. Young dated November 30, 1965, referred to a request
from the Governor of the National Bank of Vietnam (previously discussed
at the meeting on November 15, 1965) for the services of a senior economist familiar with monetary policies to advise him for a period of one
or two months.
The memorandum stated that the staff had been unable
to find a qualified economist who could undertake an assignment of such
length on short notice.
However, it had been learned that Professor
Arthur Bloomfield of the University of Pennsylvania would consider
undertaking such an assignment during the period December 25, 1965, to
January 12, 1966.
Assuming that the Governor of the National Bank of
Vietnam believed a mission of this length would serve a useful purpose,
Mr. Young recommended that the Board arrange to have Professor Bloomfield
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hired as a consultant for the period of the mission and make his services
available.
Professor Bloomfield had in the past been paid the maximum
consultant fee (now $100 per day), and Mr. Young recommended that either
the Board or the New York Reserve Bank contract for Mr. Bloomfield's
services on this basis.
If Mr. Bloomfield were a Board employee, normal
practice would call for the National Bank of Vietnam to pay his travel
and out-of-pocket expenses.
However, Mr. Young recommended that in this
case the System absorb the consultant fee and ask the National Bank to
pay only the travel expenses.
During discussion some members of the Board indicated that if
there was any question about the National Bank of Vietnam's being in a
position to reimburse the travel expenses, they believed the System
should pay such expenses on a nonreimbursable basis.
However, the staff
indicated that this was an unlikely possibility.
At the conclusion of the discussion, unanimous approval was
given to the sending of a cable to the Governor of the National Bank
of Vietnam in the form attached as Item No. 7.
Chase Manhattan proposal (Item No. 8).
There had been dis-
tributed a memorandum from Messrs. Hackley and Hexter dated November 26,
1965, having further reference to the proposal of The Chase Manhattan
Bank (National Association), New York, New York, to acquire between 80
and 100 per cent of the stock of Liberty National Bank and Trust Company,
Buffalo, New York, in exchange for newly-issued shares of Chase stock.
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-15Prima facie, the acquisition would make Chase a "holding
company affiliate" under section 2(c) of the Banking Act of 1933, and
therefore subject to the voting permit and other requirements of section 5144 of the Revised Statutes.
However, section 301 of the Banking
Act of 1935 had amended section 2(c) of the 1933 Act to provide that a
of
company shall cease to be a holding company affiliate if the Board
ly,
Governors determines that it is not engaged, directly or indirect
as a business in holding the stock of or managing or controlling banks.
Chase Manhattan had asked the Board for such a section 301
a permit
determination or, if the Board denied such a determination,
to vote the stock of Liberty National Bank and Trust Company.
In its
n that it
reply of November 3, 1965, the Board informed Chase Manhatta
a voting permit
appeared that neither a section 301 determination nor
could be granted.
s
However, the Board offered to consider any argument
wish to submit before
or comments that counsel for Chase Manhattan might
acting upon the bank's request.
submitted a
With a letter dated November 19, counsel for Chase
matters.
memorandum relating solely to the first of these two
For
was the opinion of
reasons described in the November 26 memorandum, it
were not suffiMessrs. Hackley and Hexter that the arguments advanced
the matter, as
cient cause for a change in the Board's position on
letter.
tentatively expressed in the Board's November 3
It continued
justified in making a
to be their opinion that the Board would not be
section 301 determination.
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-16The November 19 letter from counsel for Chase had requested an
opportunity to appear before the Board or members thereof, in company
with counsel for Liberty National Bank and Trust Company, to present
views if the Board was inclined to deny a section 301 determination.
The alternatives appeared to be (1) to hear oral argument on the section 301 question before the voting permit question was briefed, (2)
to deny oral argument on section 301, or (3) to postpone a decision on
whether to hear oral argument until counsel for Chase submitted a memorandum on the voting permit question.
mended the third alternative.
Messrs. Hackley and Hexter recom-
A draft of letter to counsel for Chase
.
Manhattan reflecting that recommendation was attached to their memorandum
the
After a general discussion, unanimous approval was given to
as
letter to counsel for Chase Manhattan, a copy of which is attached
Item No. 8.
Fauver,
All members of the staff except Messrs. Sherman, Kenyon,
Johnson, and Morgan then withdrew from the meeting.
Director appointments.
It was agreed to ascertain through the
the following
Chairman of the Federal Reserve Bank of Atlanta whether
Bank or branch
persons would accept appointment if tendered as Reserve
that if it
directors for the terms indicated, with the understanding
be made:
were found that they would accept, the appointments would
Atlanta,
Carl J. Reith, President of Colonial Stores, Inc.,
Bank
Reserve
Federal
Georgia, as a Class C director of the
it
(If
1966.
1,
for the three-year term beginning January
t,
appointmen
the
developed that Mr. Reith could not accept
to
respect
with
it was understood that inquiry would be made
Sears,
of
L. E. Oliver, Vice President, Southern Territory
Roebuck and Company, Atlanta.)
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Douglas McLain Pratt, President of National City Lines, Tampa,
Florida, as a director of the Jacksonville Branch for the
unexpired portion of the term ending December 31, 1967 (to
succeed Harry T. Vaughn, who had resigned effective January 1,
1966, from the Jacksonville Branch board to begin service as
Class B director).
William Jackson Bowen, President of Florida Gas Co., Winter
Park, Florida, as a director of the Jacksonville Branch for
the three-year term beginning January 1, 1966.
George Alexander Heard, Chancellor of Vanderbilt University,
Nashville, Tennessee, as a director of the Nashville Branch
for the three-year term beginning January 1, 1966.
Herbert E. Longenecker, President of Tulane University, New
Orleans, Louisiana, as a director of the New Orleans Branch
for the three-year term beginning January 1, 1966.
Secretary's Note: It having been ascertained
that Messrs. Pratt and Heard would accept
appointment if tendered, appointment wires
were sent to them on December 8, 1965.
conIt having been ascertained that certain persons previously
to
sidered were not available for service at this time, it was agreed
ascertain through the Chairman of the Federal Reserve Bank of San
Vegetable
Francisco whether Bernard T. Rocca, Jr., President of Pacific
Oil Corporation, San Francisco, California, would accept appointment
for
if tendered as Class C director of the San Francisco Reserve Bank
the three-year term beginning January 1, 1966, with the understanding
made.
that if it were found he would accept, the appointment would be
Secretary's Note: It having been ascertained
that Mr. Rocca would accept appointment if
tendered, an appointment wire was sent to him
on December 3, 1965.
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-18In this connection it was understood that advice would now go
forward to John D. Fredericks of his reappointment as Deputy Chairman
of the San Francisco Reserve Bank for the year 1966.
Messrs. Fauver and Morgan then withdrew from the meeting.
Salaries of Presidents and First Vice Presidents (Items 9-19).
There had been distributed a memorandum from the Division of Personnel
Administration dated November 30, 1965, attaching a summary of salaries
proposed effective January 1, 1966, for Presidents and First Vice Presidents of Federal Reserve Banks.
The memorandum noted that all proposals
for increases were within the framework of the guidelines set forth in
the Board's letters of November 3, 1965.
It was noted that no increase
had been proposed for President Clay of the Kansas City Reserve Bank,
although he was eligible for a $5,000 maximum increase, and it was suggested that perhaps this should be called to the attention of Chairman
Scott, who would be in Washington this week to attend the meeting of
the Conference of Chairmen of the Federal Reserve Banks.
The memorandum pointed out that letters from three Reserve Banks
containing salary proposals had also included advice of the reappointment by the respective Boards of Directors of Presidents or First Vice
Presidents for five-year terms beginning March 1, 1966, subject to
approval by the Board of Governors.
The directors of the Philadelphia
Reserve Bank had advised of the reappointment of President Bopp and First
Vice President Hilkert.
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the expiration of the five-year term, the directors had apparently had
in mind a full term.
The directors of the Cleveland Bank had advised
of the reappointment of President Hickman.
The directors of the Dallas
Bank had advised of the reappointment of President Irons and First Vice
President Coldwell.
Mr. Irons would reach age 65 on January 18, 1968,
and the Dallas Bank stated that his reappointment was "subject to appropriate retirement provisions."
In discussion it was understood that Governor Robertson would
mention the matter of President Clay's salary to Chairman Scott.
Subject to this understanding, the proposed salaries of the
were
respective Presidents and First Vice Presidents for the year 1966
.1. unanimously, and it was understood that appropriate letters
.U_RET/0
would be sent to the Chairmen of the respective Banks.
(In the case
of the Atlanta Bank a statement of proposed salaries for the President
and First Vice President for 1966 had not been received; it was assumed
that the current annual salary rates were meant to be continued.)
Copies
of letters sent to the Chairmen of the respective Reserve Banks, except
Kansas City, pursuant to this action are attached as Items 9 through 19.
As to the question about Presidents or First Vice Presidents
terms
who would reach age 65 before the expiration of their five-year
of appointment, Governor Mitchell pointed out that a number of years
that
ago the then General Counsel of the Board had rendered an opinion
the Board could not require resignations at age 65.
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Federal Reserve Bank of St. Louis
On the other hand,
12/1/65
-20-
it was noted that in some cases there had been an understanding that
the appointee would leave office upon reaching age 65.
It was suggested
that a letter might be sent to the Chairmen of the Federal Reserve Banks
to the effect that a person appointed as President or First Vice President would be expected to resign upon reaching age 65 unless requested
to stay on, and the reaction to such an approach appeared to be generally
favorable.
The meeting then adjourned.
Secretary's Notes: Pursuant to the understanding at the Board meeting on September 20,
1965, a letter was sent to all Federal Reserve
Banks on November 30, 1965, relating to an
apparent violation of Regulation U, Loans by
Banks for the Purpose of Purchasing or Carrying Registered Stocks, at a national bank in
Boston, Massachusetts. A copy of the letter
is attached as Item No. 20.
Acting in the absence of Governor Shepardson,
Governor Balderston approved on behalf of the
Board on November 30, 1965, the following items:
Letter to the Federal Reserve Bank of Philadelphia (attached Item
No. 21) approving the designation of six employees as special assistant
examiners.
Letter to the Federal Reserve Bank of Chicago (attached Item No. 22)
approving the appointment of Harold E. Ford as assistant examiner.
Letter to the Federal Reserve Bank of San Francisco (attached Item
No. 23) approving the appointment of Robert B. Fox and Gilbert A. Lord
as examiners.
Memorandum from the Division of Administrative Services recommending
of Junius M. Fletcher, Jr., as Messenger in that Division,
appointment
the
salary at the rate of $3,507, effective the date of
annual
with basic
duty.
entrance upon
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Federal Reserve Bank of St. Louis
12/1/65
-21Acting in the absence of Governor Shepardson,
Governor Robertson today approved on behalf
of the Board memoranda recommending the following actions relating to the Board's staff:
Appointments
Rexanne Edith Byard as Statistical Clerk, Division of Data Processing, with basic annual salary at the rate of $3,814, effective the date
of entrance upon duty.
James M. Howell as Economist, Division of Research and Statistics,
with basic annual salary at the rate of $11,723, effective the date of
entrance upon duty.
Salary increases
Wesley B. Collins, Photographer (Offset), Division of Administrative
Services, from $5,886 to $6,094 per annum, effective December 5, 1965.
Jeannette R. DeLawter, Secretary, Division of Research and Statistics,
from $5,865 to $6,278 per annum, effective December 5, 1965.
Transfer
Lula B. Bierly, from the position of Clerk in the Division of
Division
International Finance to the position of Editorial Clerk in the
at
salary
annual
of Research and Statistics, with no change in basic
the rate of $5,109, effective upon assuming her new duties.
Secretary
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Federal Reserve Bank of St. Louis
BOARD OF GOVERNORS
Item No. 1
12/1/65
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON, O. C. 20551
DENCE
ADDRESS OFFICIAL CORRESPON
TO THE BOARD
December 1, 1965
Board of Directors,
The Union Commerce Bank,
Cleveland, Ohio.
Gentlemen:
The Board of Governors of the Federal Reserve
System extends to February 15, 1968, the time within
which The Union Commerce Bank, Cleveland, Ohio, may
establish a branch at the southeast corner of the intersection of East Ninth Street and St. Clair Avenue,
Cleveland, Ohio.
Very truly yours,
(Signed) Karl E. Bakke
Karl E. Bakke,
Assistant Secretary.
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Federal Reserve Bank of St. Louis
39e,(
Item No. 2
12/1/65
UNITED STATES OF A-dERICA
BEFORE THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
WASHINGTON, D. C.
---------------In the Matter of the Application of
GREENFIELD BANKING COMPANY
for approval of merger with
The First National Bank of Fortville'
--------------
ORDER APPROVING MERGER OF BANKS
There has come before the Board of Governors, pursuant to the
Bank Merger Act of 1960 (12 U.S.C. 1828(c)), an application by Greenfield
Banking Company, Greenfield, Indiana, a State member bank of the Federal
Reserve System, for the Boards prior approval of the merger of that
bank and The First National Bank of Fortville, Fortville, Indiana,
under the charter and title of the former.
As an incident to the merger,
the sole office of The First National Bank of Fortville would become a
branch of the resulting bank.
Notice of the proposed merger, in form
approved by the Board, has been published pursuant to said Act.
Upon consideration of all relevant material in the light of
the factors set forth in said Act, including reports furnished by the
Comptroller of the Currency, the Federal Deposit Insurance Corporation,
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Federal Reserve Bank of St. Louis
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-2and the Attorney General on the competitive factors involved in
the proposed merger,
IT IS HEREBY ORDERED, for the reasons set forth in the
Board's Statement of this date, that said application be and hereby
is approved, provided that said merger shall not be consummated
(a) within seven calendar days after the date of this Order or
(b) later than three months after said date.
Dated at Washington, D. C., this 1st day of December, 1965.
By order of the Board of Governors.
Voting for this action:
Unanimous, with all members present.
(signed) Merritt Sherman
Merritt Sherman,
Secretary.
(sEAL)
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Federal Reserve Bank of St. Louis
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Item No. 3
12/1/65
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
APPLICATION OF GREENFIELD BANKING COMPANY
FOR APPROVAL OF MERGER WITH
NATIONAL BANK OF FORTVILLE
FIRST
THE
STATEMENT
Greenfield Banking Company, Greenfield, Indiana ("Greenfield
Bank")) with total deposits of $13 million, has applied, pursuant to
the Bank Merger Act of 1960 (12 U.S.C. 1828(c)), for the Board's
prior approval of the merger of that bank and The First National Bank
of Fortville, Fortville, Indiana ("Fortville Bank"), which has total
deposits of $4 mi11ion.1/—
The banks would merge under the charter and
title of Greenfield Bank, which is a member of the Federal Reserve
System.
As an incident to the merger, the one office of Fortville
Bank would become an office of Greenfield Bank, increasing the number
of its authorized offices to three.
As required by law, the Board has considered, as to each of
the banks involved, (1) its financial history and condition, (2) the
adequacy of its capital structure, (3) its future earnings prospects,
(4) the general character of its management, (5) whether its corporate
1/ Deposit figures are as of June 30, 1965.
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Federal Reserve Bank of St. Louis
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(
)( '52:
•
Powers are consistent with the purposes of 12 U.S.C., Ch. 16 (the
Federal Deposit Insurance Act), (6) the convenience and needs of the
community to be served, and (7) the effect of the transaction on
competition (including any tendency toward monopoly).
The Board
may not approve the transaction unless, after considering all of
these factors, it finds the transaction to be in the public interest.
Bankl.ng factors. - Fortville Bank has an adequate capital
structure.
In recent years it has experienced increasing loan losses
and declining
earnings.
Consummation of the transaction would
minimize the loss potential and provide a basis for improved earnings.
In addition,
as Fortville Bank's senior officers have passed normal
retirement age, effectuation of the proposal would assure continued
management for the banking office in Fortville.
Convenience and needs of the communities. - Greenfield is
a city of 9,000 persons located 21 miles east of Indianapolis.
It is
the county seat
and largest city in Hancock County, which adjoins the
Indianapolis Standard Metropolitan Statistical Area.
As Greenfield
Bank offers a broad range of banking services and as there are a
number of alternative sources of banking services near the Greenfield
area, the proposed merger would be of little positive benefit in
serving the convenience and needs of that area.
Fortville, also in Hancock County, is 13 miles northwest
of Greenfield and 21 miles northeast of Indianapolis.
a
The town has
Population of 2,000, and its economy is based primarily upon
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Federal Reserve Bank of St. Louis
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3901
agriculture, although there is some trend toward industrialization.
Fortville Bank appears to be serving its community reasonably well,
and while there are no other banks located in Fortville, there are
a number of banking alternatives in nearby towns.
Although there
is no evidence that the banking needs of the Fortville area are not
being served at the present time, the resulting bank would better
serve the community through more constructive loan policies, an
increased lending limit, and continuation of progressive banking
services.
Competition. - Competition between Greenfield Bank and
Fortville Bank is not significant.
The service areas?' of the banks
do not
overlap, and there is a branch office of Hancock County Bank,
Greenfield,
located directly between Fortville and Greenfield,
Hancock County Bank, with deposits of $7 million, operates
four banking offices in the county.
The bank is the result of a
recent merger and is Greenfield Bank's principal competitor.
American
Fletcher National Bank, Indianapolis, also operates two branches on
the
Periphery of Hancock County, one six miles from Fortville and
the other
ten miles from Greenfield.
In addition, although they are
not actually located in the service areas involved, there are several
smaller banks competing at various distances from Fortville and
Gr
eenfield.
(
-2.1./ The area from which a bank derives 75 per cent or more of its
ePosits of individuals, partnerships, and corporations.
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Federal Reserve Bank of St. Louis
0.
)
'
While the resulting bank would control 21 per cent of all
IPC deposits held by banking offices competing in its service area,
this percentage of concentration of deposits is rendered almost
meaningless by the near proximity of large banks in Indianapolis and
other surrounding cities.
Summary and conclusion. - Approval of the proposed merger
would assure constructive lending policies in the Fortville area,
Provide a basis for improved earnings, and provide continuity of
management, thereby assuring continued sound banking service in
Fortville and enabling the convenience and needs of the community
to be better served.
The effect on competition would not be adverse.
Accordingly, the Board finds that the proposed merger
would be in the public interest.
December
1, 1965.
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Federal Reserve Bank of St. Louis
- 3906
Item No. 4
12/1/65
UNITED STATES OF AMERICA
BEFORE THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
WASHINGTON, D. C.
-----------------------
In the Matter of the Application of
BANCOUI0 CORPORATION,
Columbus, Ohio,
for approval of the acquisition of up to
100 per cent of the outstanding voting shares
of The First National Bank of Jackson,
Jackson, Ohio.
ORDER APPROVING APPLICATION UNDER
BANK HOLDING COMPANY ACT
There has come before the Board of Governors, pursuant to
section 3(a)(2) of the Bank Holding Company Act of 1956
(12 U.S.C. 1842(a)(2)), and section 222.4(a)(2) of Federal Reserve
BancOhio Corporation,
Regulation Y (12 CFR 222.4(a)(2)), an application by
prior
Columbus, Ohio, a registered bank holding company, for the Board's
approval of the acquisition of up to 100 per cent of the outstanding
voting shares of The First National Bank of Jackson, Jackson, Ohio.
notified
In accordance with section 3(h) of the Act, the Board
the Comptroller of the Currency of receipt of the application and re.
questcd his views and recommendati.on with respect to the application
The Corptroller recommended approval of the application.
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Federal Reserve Bank of St. Louis
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3(3
Notice of receipt of the application was published in the
Federal Register of May 6, 1965 (30 F.R. 6368), providing an opportunity
for interested persons to submit comments and views with respect to the
Proposed acquisition.
The time for filing such comments and views has
expired, and all those received have been considered by the Board.
IT IS HEREBY ORDERED, for the reasons set forth in the Board's
Statement of this date, that said application be and hereby is approved,
provided that the acquisition so approved shall not be consummated
(a) within seven calendar days after the date of this Order or (b) later
than three months after said date.
Dated at Washington, D. C., this 1st day of December, 1965.
By order of the Board of Governors.
Voting for this action:
Unanimous, with all members present.
(Signed)
Merritt Sherman
Merritt Sherman,
Secretary.
(SEAL)
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Federal Reserve Bank of St. Louis
- 39C!'..z.
Item No. 5
12/1/65
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
APPLICATION BY BANCOHIO CORPORATION
FOR APPROVAL OF THE ACQUISITION OF SHARES
OF THE FIRST NATIONAL BANK OF JACKSON
STATEMENT
BancOhio Corporation, Columbus, Ohio ("Applicant"), a
registered bank holding company, has filed with the Board, pursuant to
section 3(a)(2) of the Bank Holding Company Act of 1956 ("the Act"), an
application for approval of the acquisition of up to 100 per cent of
the outstanding voting shares of The First National Bank of Jackson,
Jackson, Ohio ("Bank").
Views and recommendation of supervisory authority. - As
required by section 3(b) of the Act, notice of receipt of the application was given to, and views and recommendation requested of, the
Comptroller of the Currency.
The Comptroller recommended approval of
the application.
Statutory factors. - Section 3(c) of the Act requires the
Board to take into consideration the following five factors in acting
on this application: (1) the financial history and condition of the
holding company and the banks concerned; (2) their prospects; (3) the
Character of their management; (4) the convenience, needs, and welfare
of the communities and the area concerned; and (5) whether or not the
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Federal Reserve Bank of St. Louis
-2effect of the acquisition would be to expand the size or extent of the
bank holding company system involved beyond limits consistent with adequate and sound banking, the public interest, and the preservation of
competition in the field of banking.
Financial history, condition, and prospects of Applicant and
Bank concerned. - Applicant, organized under the laws of the State of Ohio
Ott September 29, 1929, has been regulated, since 1933, as a holding company
affiliate.
be satisIts financial history and condition have been found to
t
factory. The data of record reflect that, as of March 31, 1965, Applican
had cash and miscellaneous securities amounting to $1.5 million in excess
1/
its investment in 22 subof its liabilities. As of December 31, 1964,
ted 97 per
sidiary banks, the last of which was acquired in 1958, represen
cent of the total assets of Applicant. Deposits amounted to approximately
2/
a
$809 million,— and capital and loan reserves were $78 million,
ratio of 1 to 10.3 of deposits.
Ohio National Bank, Columbus (Franklin
approximately
County), Applicant's largest banking subsidiary, held
held by all
$492 million of deposits, more than 50 per cent of the total
of Applicant's banks.
The operation of the 22 subsidiary banks has been
found to be satisfactory.
The subsidiary banks' reported profits, dividends
the substantial
paid, and earnings retained for the years 1960-1964 indicate
growth enjoyed by BancOhio and its subsidiary banks.
The Board concludes
as of this date.
1/ Unless otherwise indicated, all data herein are
Applicant's First
2/ A merger in 1965 of the Farmers Bank, Sunbury, with
deposits to
these
d
increase
National Bank of Delaware in Delaware, Ohio,
$811.7 million.
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Federal Reserve Bank of St. Louis
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-3-
that the financial history, condition, and prospects of Applicant and its
subsidiary banks are satisfactory.
Bank, originally established as a private bank in 1865, became
a national bank in 1871.
It is located in Jackson, Ohio, approximately
75 miles south of Columbus.
The record shows for Bank approximate deposits
of $15 million, assets of $17 million, loans of $6 million, and capital and
reserves for loans and securities amounting to $1.6 million. Despite the
3/
Bank's earnings have been good
Poor economic climate of Jackson County,
and its capital position satisfactory.
Bank's growth over the last five
years is reflected by an increase in deposits and loans of about 19 per
cent and 18 per cent, respectively.
creased.
Profits and dividends have also in-
The Board concludes that Bank's financial history and condition
are satisfactory.
Its prospects, provided management and controlling
ownership continue to be sound, are also satisfactory.
its
Character of management of Applicant and Bank. - BancOhio and
has been demonsubsidiaries have been and are satisfactorily managed, as
strated over a substantial period of years.
change of
Bank's ownership and management have been good but a
ownership and management is imminent.
Control has been held for years by
a Mr. Jones who, with his family and the corporations he controls, awns
approximately 78 per cent of Bank's outstanding shares.
He proposes to
sell his interest in Bank and retire. Several key directors of Bank also plan ta
3/
Program.
It has been included in the Federal Appalachia
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Federal Reserve Bank of St. Louis
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relinquish their positions.
:
Applicant states that Mr. Jones refused to
negotiate with potential purchasers, other than Applicant, for the reason
that the principals were undisclosed and he could not, therefore, be sure
of a continuity of satisfactory management for Bank.
Applicant is in a position to provide, as needed, qualified
Officers and capable directorate for Bank.
Bank's affiliation with Appli-
cant offers reasonable assurance of a continuity of competent, experienced
executive management.
Uhile the Board recognizes that Applicant's proposed
n problem,
acquisition is not the only solution to Bank's management successio
the Board finds the proposal herein to be an immediate and reasonable solution, and concludes that the factor of management is a consideration favorable
to approval of the application.
Convenience, needs, and welfare of the communities and the area
a population of
concerned. - Bank is the only bank in Jackson, a city with
4/
with an estimated
approximately 7,100. The primary service area of Bank,
a small
Population of about 30,000, includes all of Jackson County and
agricultural section of contiguous Pike County.
The primary service area
from
covers a territory within an estimated average distance of 12 miles
Bank.
There are three other banks in the area.
Two are in Wellston, 9 miles
south of
northeast of Jackson,and one is in Oak Hill, 12 miles to the
Jackson.
and
They are small, independent banks, each having one office,
their combined deposits are less than the deposits of Bank.
The record
cent of Bank's deposits
4/ The area from which Applicant indicates that 84 per
) originate.
deposits"
("IPC
of individuals, partnerships, and corporations
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Federal Reserve Bank of St. Louis
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3912
reflects that business growth in the area has been only moderate in recent
years and that the area could benefit from additional economic stimuli.
The application reflects that, in the 10-year period ending June 1964,
three important industries left Jackson.
Further, median family income
and average value of dwelling units in Jackson are substantially below
State averages.
Apropos of this situation, Applicant asserts that its diver-
sified contacts with national companies and correspondent banks can assist
in obtaining new business for the area.
Applicant's financial resources
and its past operating history lend support to its assertion.
The services now offered by Bank appear to be serving adequately
the needs arising within Bank's service area - a fact evidenced by Applicant's statement that no significant changes in services are presently conIn the foreseeable future, however, Applicant anticipates a
template&
need for, and stands ready to initiate at or through Bank, such services as
assisting in the administration of Bank's investment account; preparation
of tax returns; performance of examination and audit functions; consultation
on matters involving credit, insurance, personnel, systems, and procedures;
and, eventually, furnishing data processing services.
Uhile the nature of
the improved or additional services mentioned is such that their rendition
would benefit most directly Bank, indirectly the public also would be
benefitted.
It should be noted that the Board's earlier finding regarding
the beneficial effect of Applicant's ownership of Bank, in respect to
Providing management succession in Bank, bears also upon the convenience
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Federal Reserve Bank of St. Louis
kfi
r ilk. I
-6-
and needs of the area concerned, especially in the light of the fact that
Bank is the largest of the four banks in the primary service area and no
purchaser acceptable to the stockholders is immediately available other
than Applicant.
On the basis of the foregoing findings, the Board concludes that
considerations bearing on the convenience, needs, and general welfare of
the communities and area concerned lend some weight toward approval of
Applicant's proposal.
Effect of proposed acquisition on adequate and sound banking,
21111„lic interest, and banking competition. - None of Applicant's subsidiary
banks' offices is located in Bank's primary service area.
Of Applicant's
subsidiaries, the three which are closest to Bank are First National Bank,
Chillicothe (29 miles northwest), Farmers and Merchants Bank, Logan
(43 miles north), and National Bank of Portsmouth, Portsmouth (37 miles
southwest). Analyses of the origins of loan and deposit accounts at the
three named subsidiary banks, and of the deposits and loans at Bank, show
that Applicant's three subsidiaries nearest Bank are not significant
competitors in Bank's area of operations; nor is Bank a significant competitor
in the area of Applicant's subsidiaries.
According to Applicant, apart from the aforementioned three
subsidiary banks, 13 other banks are located, respectively, from 18 to 45 miles
from Bank's location, all outside Bank's primary service area.
Considering
the Sias of these banks, their distances from Bank, and the fact that the
two banks in Wellston are located between Bank and the closest of the 13 banks
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Federal Reserve Bank of St. Louis
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aforementioned, it may reasonably be concluded that the latter banks are
not significant competitors of Bank.
It appears that little significant competition exists between and
among the banks within Bank's primary service area.
Each of the two banks
located in Wellston, some 9 miles northe4st of Jackson, and the bank in Oak
12 miles south of Jackson, appear to derive a major portion of their
business from the communities in which they are located.
The respective
sizes of these institutions and the topographical features of the communities
in which they are situated make unlikely any significant competition with
Bank.
For the foregoing reasons, the Board concludes that the proposed
affiliation would not adversely affect, to any significant degree, the
competitive force of other banks in the area.
Regarding the increase in the size of Applicant's system that
would follow consummation of the acquisition proposed, Applicant's present
control of 5.7 per cent of the deposits and 5.1 per cent of the banking
Offices of all commercial banks in the State would be increased, respectively,
bY .1 per cent or less.
Similarly, total loans held by Applicant's sub-
sidiaries would be increased by but .1 per cent. Applicant's system is the
5/
Its deposits are exceeded
fourth largest banking organization in Ohio.
by those of the Cleveland Trust Co. ($1,640 million), National City Bank of
only other registered bank holding company in
ITSociety Corporation, thebanking
organization in the State and controls
Ohio, is the fifth largest
deposits of approximately $559 million. The two bank holding companies
in the State control 6.4 per cent of the offices and 9.6 per cent of the
deposits of all commercial banks.
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Federal Reserve Bank of St. Louis
39.L.5
-8-
Cleveland ($970.4 million), and Central National Bank, Cleveland
($815.6 million).
Acquisition of Bank would raise Applicant to the rank
Of third by a small margin.
On the State scene, it is reasonable to con-
clude that the proposed increase in size will not cause an alarming or
undue concentration of banking resources, nor does it demonstrate a tendency
to monopoly by the Applicant.
The Board notes that Applicant's expansion in the period 19511964, inclusive, appears to reflect, primarily, internal growth, rather
than predatory practices or a tendency toward monopoly.
While its sub-
sidiaries' deposits rose, in that period, from about $404 million to about
$809 million - an increase from 5.2 to 5.7 per cent of deposits of commercial
banks in the State - the increase in size was due, only in small measure,
to acquisitions of existing banks.
Applicant acquired four existing banks
with total deposits of about $24.6 million.
Over a 31-year period (1934-
1964), Applicant acquired or merged 15 existing banks with aggregate deposits
of about $48.5 million.
Applicant's subsidiaries are located in 20 counties, 17 of which
are contiguous, in central and south-central Ohio.
Acquisition of Bank
would increase to 19 the number of contiguous counties served by Applicant's
system.
If the proposal is consummated, the deposits of Applicant's banks
would rise from 41 per cent to 42 per cent of the deposits of all commercial
banks in the 21 counties (out of Ohio's 88 counties) in which Applicant would
have banks.
Excluding Franklin County, inclusion of which heavily weights
the percentages because Applicant's largest subsidiary is located there and
Applicant's three subsidiaries in Franklin County account for about 47 per
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Federal Reserve Bank of St. Louis
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cent of Applicant's offices and about two-thirds of its deposits,
the
increase in the 20 counties would be from 29.3 per cent to 31 per cent.
Commercial banks in the aforementioned 21 counties hold approximately
14 per cent of total deposits of all commercial banks in Ohio.
In each of the 20 counties where Applicant's banks are located,
BancOhio has only one bank, except for Franklin County where BancOhio has 3,
including the largest, of the 9 banks in the County.
In each of 8 of the
other 19 counties, Applicant's bank is the largest bank; however, in each
of these 8 counties, with one exception, there is a bank of a size to be a
fairly strong competitor.
In the remaining 11 of the said 19 counties,
Applicant's bank is not the largest.
As indicated earlier, the affiliation
herein would leave 67 Ohio counties where Applicant has no subsidiary.
Consummation of Applicant's proposal would result in control of
52 per cent of the deposits of commercial banks in Jackson County.
The
appearance of dominance presented is lessened by a number of considerations.
Applicant has no bank in the City of Jackson or in Bank's primary service
area.
The area is not a significant one in the State from the point of view
of population, economy, or banking.
In the light of these considerations
and all the data in the record, it appears to the Board that the proposed
acquisition would not create such concentration of banking resources as to
require a disapproval of the application.
6/ It may be observed that, in Franklin County in the 10-year period
1955 to 1964, inclusive, the percentage of deposits held by Applicant's
banks decreased from 57 to 52, while the percentages of the other two
large Columbus banks increased.
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Federal Reserve Bank of St. Louis
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The Department of Justice submitted views on the subject
application, but refrained from making any recommendation.
The data
and views based thereon as presented in the Department of Justice
statement have been considered by the Board, together with Applicant's
reply thereto. The Department's suggestion, that the proposed acquisition
may serve as a precedent or set a pattern for future expansion, is not
considered to be a significant factor adverse to the proposed acquisition,
as the Board consistently has taken the position that each application must
be considered on the pertinent facts presented and that a decision by the
Board in a given matter does not constitute any commitment on future
applications.
In the light of the foregoing considerations and all the facts
in the record, the Board concludes that consummation of the subject proposal would not increase Applicant's size or extent beyond limits consistent with adequate and sound banking, the public interest, and the
Preservation of competition in the field of banking.
On the basis of all the relevant facts as contained in the record
before the Board, and in the light of the factors set forth in section 3(c)
of the Act, it is the Board's judgment that the proposed transaction would
be consistent with the public interest, and that the application should,
therefore, be approved.
December 1, 1965.
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Federal Reserve Bank of St. Louis
31
BOARD OF GOVERNORS
Item No. 6
12/1/65
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON
101
,
01"1
or THE'CHAIRMAN
December 8, 1965
The Honorable Wright Pathan,
Chairman,
Committee on Banking sad Currency,
House of Representativos,
Washington, D. C. 20515.
Dear Mr. Chairman:
As requested in your letter of October 27, there
are enclosed listings of all dues and contributions made by
each of the Federal Reserve Banks, their branches, and the
Board of Governors for the period January 1, 1962 through
September 30, 1965.
Sincerely yours,
(Signed) Wm. McC. Martin, Jr.
Wm. McC. Martin, Jr.
Enclosures
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Federal Reserve Bank of St. Louis
CABLE
Item No. 7
12/1/65
December 1, 1965.
Governor Hanh,
National Bank of Vietnam,
BANVINA, Saigon.
Ref your ltr to Holmes NY Bank 11/3/65. Regret unable to
find highly qualified economist available for 2 month mission
on such short notice. Arthur Bloomfield, former Senior
Economist NY Bank, drafter of your Bank's statutes, consultant
on problems of money and banking in Korea and Malaysia, now
Prof. of Economics, U. of Penn., will consider short mission
to Saigon from December 25 to January 12. Would like nature
of assignment to be spelled out more precisely. If acceptable
to you, we would hire Bloomfield as FR System consultant for
this period. We would pay the consultant fee but would ask
you to reimburse us for travel expenses.
(Signed) Merritt Sherman
SHERMAN, Secretary
FED RESERVE
Washington
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
rt(lrl!
Item No. 8
12/1/65
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON, D. C. 20551
ONDENCE
ADDRESS OFFICIAL CORRESP
TO THE BOARD
December 1, 1965.
Roy C. Haberkern, Jr., Esq.,
Milbank, Tweed, Hadley & McCloy,
1 Chase Manhattan Plaza,
New York, New York. 10005
Dear Mr. Haberkern:
y, dated
This is in response to your letter to Mr. Hackle
support
in
ndum
memora
a
ed
enclos
you
November 19, 1965, with which
Chase Manhattan
of your contention that, upon acquisition by The
stock of Liberty
the
of
ty
majori
a
Bank (National Association) of
would not be
Chase
Y.,
N.
o,
Buffal
y,
National Bank and Trust Compan
section 2(c) of
a "holding company affiliate" within the meaning of
the Banking Act of 1933.
presented
The Board has considered carefully the arguments
n. Further study
in your memorandum and the references cited therei
as stated in its
sion,
conclu
s
Board'
the
of the matter has confirmed
amendment to
1935
the
that
on,
Champi
Mr.
letter of November 3 to
ng company
"holdi
the
from
e
exclud
to
ed
intend
section 2(c) was not
engaged in the
affiliate" category organizations that are principally
amendment the
banking business. As you know, in describing that
nces of a
Report of the Senate Banking Committee referred to "insta
, labor
church
a
bank being controlled by an organization, such as
of which
ties
activi
union, charitable foundation, etc., the principal
ent",
amendm
the
of
are entirely outside the banking field. The effect
the
from
s
zation
organi
the Report continued, "is to relieve such
ies engaged as a
limitations and requirements to which holding compan
No. 1007,
Rep.
(S.
t".
business in controlling banks are subjec
Cong. (1935),
74th
742,
No.
74th Cong. (1935), p. 14; see also H. Rep.
p. 15.)
views
Your letter requests an opportunity to present your
your
accept
to
ed
inclin
not
is
orally, in the event that the Board
ate
affili
y
compan
g
holdin
from
ion
conclusion with respect to the exempt
ndum
memora
your
gh
althou
that,
r,
status. It is also noted, howeve
[were] reserved
related only to that aspect of the matter, "all rights
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
BOARD OF GOVERNORS OF THE rEDERAL RESERVE SYSTEM
Roy C. Haberkern, Jr., Esq.
.2.
with respect to the request for a voting permit which would entitle
[Chase] to vote the stock of Liberty • • . ." In the circumstances,
the Board considers it preferable to defer its decision with respect
to oral argument until you have had an opportunity to submit a memorandum on the voting permit question, if you elect to do so.
Very truly yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
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Federal Reserve Bank of St. Louis
•
Item No. 9
12/1/65
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON
OFFICE OF THE CHAIRMAN
December 7, 1965,
CONFIDENTIAL (FR)
Mr. Erwin D. Canham, Chairman,
Federal Reserve Bank of Boston,
Boston, Massachusetts. 02106
Dear Spike:
The Board of Governors approves the payment of
Mr. George H. Ellis as President and Mr. Earle
to
salaries
First Vice President of the Federal Reserve
as
Latham
O.
at rates of $40,000 and $31,500 per annum,
Boston
of
Bank
respectively, effective January 1, 1966. The rates approved
are those fixed by your Board of Directors, as reported in
your letters of October 7 and November 10, 1965.
Sincerely yours,
Wm. McC. Martin, Jr.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
3
(
- :3
Item No. 10
12/1/65
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON
OFFICE OF' THE CHAIRMAN
December 7, 1965.
CONFIDENTIAL (FR)
Mr. Philip D. Reed, Chairman,
Federal Reserve Bank of New York,
New York, New York. 10045
Dear Phil:
The Board of Governors approves the payment of
salaries to Mr. Alfred Hayes as President and Mr. William F.
Treiber as First Vice President of the Federal Reserve Bank
of New York for the period January 1 through February 28,
1966, at rates of $75,000 and $45,000 per annum, respectively.
These rates, fixed by your Board of Directors, were reported
in Deputy Chairman Case's letter of November 19, 1965.
Sincerely yours,
Wm. McC. Martin, Jr.
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Federal Reserve Bank of St. Louis
Item No. 11
12/1/65
BOARD OF GOVERNORS
OF THE
A\
FEDERAL RESERVE SYSTEM
• .71
•
WASHINGTON
OFFICE OF THE CHAIRMAN
"-2-fl'forf.
Rts,.•
.PAL
••••••
December 15, 1965
CONFIDENTIAL (FR)
Mr. Walter E. Hoadley, Chairman,
phia,
Federal Reserve Bank of Philadel
1
1910
.
ania
sylv
Penn
Philadelphia,
Dear Walter:
oved the payment of
The Board of Governors has appr
President Hilkert at
Vice
t
salaries to President Bopp and Firs
ectively, effective
resp
m,
annu
rates of $45,000 and $31,500 per
in your letter of November 19,
January 1, 1966, as requested
1965.
appointment of
Board action with respect to the
five-year term
the
for
idents
Presidents and First Vice Pres
y in 1966
earl
l
unti
rred
beginning March 1 has been defe
Banks.
the
of
all
from
when requests have been received
Sincerely yours,
(Signed) Bill
Wm. McC. Martin, Jr.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
392tBOARD OF GOVERNORS
Item No. 12
12/ 1/65
OF THE
*0
sT
•
•
0.0.4s
...RA L
FEDERAL RESERVE SYSTEM
t***
•
WASHINGTON
4.•
OFFICE OF THE CHAIRMAN
Re0:.•
December 15, 1965.
CONFIDENTIAL (FR)
Mr. Joseph B. Hall, Chairman,
Federal Reserve Bank of Cleveland,
Cleveland, Ohio. 44101
Dear Joe:
3, the Board
As stated in my letter of November
t Hickman at
iden
Pres
to
ry
has approved the payment of sala
1, 1966.
ary.
Janu
e
ctiv
effe
the rate of $45,000 per annum,
the payment of
The Board of Governors also approves
at his current rate of
salary to First Vice President Fink
ary 1 through February 28,
Janu
od
$25,000 per annum, for the peri
Directors.
1966, if so fixed by your Board of
intment of
Board action with respect to the appo
-year term
five
the
for
ts
iden
Presidents and First Vice Pres
until early in 1966
beginning March 1 has been deferred
from all of the Banks.
when requests have been received
Sincerely yours,
(Signed) Bill
Wm. McC. Martin, Jr.
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Federal Reserve Bank of St. Louis
14V
Item No. 13
12/1/65
BOARD OF GOVERNORS
CF THE
FEDERAL RESERVE SYSTEM
WASHINGTON
OFFICE or THE
CHAIRMAN
December 7, 1965,
CONFIDENTIAL (FR)
Mr. Edwin Hyde, Chairman,
Federal Reserve Bank of Richmond,
Richmond, Virginia. 23213
Dear Ed:
The Board of Governors approves the payment of
salaries to Mr. Edward A. Wayne as President and Mr. Aubrey
N. Heflin as First Vice President of the Federal Reserve
Bank of Richmond, effective January 1, 1966, at rates of
$45,000 and $31,500 per annum, respectively. These rates,
fixed by your Board of Directors, were reported in your
letters of October 7 and November 11, 1965.
Sincerely yours,
Wm. McC. Martin, Jr.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
,
BOARD OF GOVERNORS
Item No. 14
12/1/65
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON
OFFICE
OF THE CHAIRMAN
December 7, 1965.
CONFIDENTIAL (FR)
Mr. Jack Tarver, Chairman,
Federal Reserve Bank of Atlanta,
Atlanta, Georgia. 30303
Dear Jack:
The Board of Governors approves the payment of
salaries to Mr. Harold T. Patterson as President and
Mr. Monroe Kimbrel as First Vice President of the Federal
Reserve Bank of Atlanta, effective January 1, 1966, at
their current rates of $35,000 and $27,500 per annum, respectively, if so fixed by your Board of Directors.
Sincerely yours,
a,ge
Wm. McC. Martin, Jr.
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Federal Reserve Bank of St. Louis
'10'
Item No. 15
12/1/65
BOARD OF GOVERNORS
Or THE
FEDERAL RESERVE SYSTEM
WASHINGTON
OFFICE OF THE CHAIRMAN
December 7, 1965.
CONFIDENTIAL (FR)
Mr. Franklin J. Lunding, Chairman,
Federal Reserve Bank of Chicago,
Chicago, Illinois. 60690
Dear Frank:
The Board of Governors approves the payment of
Hugh
salaries to Mr. Charles J. Scanlon as President and Mr.
Reserve.
J. Helmer as First Vice President of the Federal
28,
Bank of Chicago for the period January 1 through February
vely.
respecti
1966, at rates of $55,000 and $31,500 per annum,
These rates, fixed by your Board of Directors,, were reported
in your letter of November 18, 1965.
Sincerely yours,
Wm. McC. Martin, Jr.
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Federal Reserve Bank of St. Louis
Item No. 16
12/1/65
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON
OFFICE OF THE CHAIRMAN
December 7, 1965.
CONFIDENTIAL (FR)
Mr. Raymond Rebsamen,'Chairman,
Federal Reserve Bank of St. Louis,
St. Louis, Missouri. 63166
Dear Ray:
The Board of Governors approves the payment of
salaries to Mr. Harry A. Shuford as President and Mr. Darryl
R. Francis as First Vice President of the Federal Reserve
Bank of St. Louis, effective January 1, 1966, at rates of
$40,000 and $31,500 per annum, respectively. These rates,
fixed by your Board of Directors, were reported in your
letter of November 12, 1965.
Sincerely yours, ,
Wm. McC. Martin, Jr.
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Federal Reserve Bank of St. Louis
Item No. 17
12/1/65
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON
OFFICE OF THE CHAIRMAN
December 7, 1965.
CONFIDENTIAL (FR)
Mr. Atherton Bean, Chairman,
Federal Reserve Bank of Minneapolis,
Minneapolis, Minnesota. 55440
Dear Atherton:
The Board of Governors approves the payment of
salaries to Mr. Hugh D. Galusha, Jr. as President and
Mr. Maurice H. Strothman, Jr. as First Vice President of
the Federal Reserve Bank of Minneapolis at rates of $37,500
and $28,500 per annum, respectively, effective January 1,
1966. The rates approved are those fixed by your Board of
Directors, as reported in your letter of November 10, 1965.
Sincerely yours,
Wm. McC. Martin, Jr.
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Federal Reserve Bank of St. Louis
Item No. 18
12/1/65
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON
OFFICE Or THE CHAIRMAN
December 15, 1965.
CONFIDENTIAL (FR)
Mr. Robert O. Anderson, Chairman,
Federal Reserve Bank of Dallas,
Dallas, Texas. 75222
Dear Bob:
the payment
The Board of Governors has approved
t Vice
Firs
and
s
H. Iron
of salaries to President Watrous
$29,000
and
000
$45,
of
rates
President Philip E. Coldwell at
as
,
1966
1,
ary
e Janu
per annum, respectively, effectiv
11, 1965.
mber
Nove
of
er
lett
your
requested in
appointment of
Board action with respect to the
five-year term
the
for
ts
Presidents and First Vice Presiden
y in 1966
earl
l
unti
rred
beginning March 1 has been defe
Banks.
the
of
all
from
when requests have been received
Sincerely yours,
(Signed) Bill
Wm. McC. Martin, Jr.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
Item No. 19
12/1/65
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON
OFFICE or THE
CHAIRMAN
December 7, 1965.
CONFIDENTIAL (FR)
Mr. F. B. Whitman, Chairman,
Federal Reserve Bank of San Francisco,
San Francisco, California. 94120
Dear Fred:
The Board of Governors approves t4e payment of
salaries to Mr. Eliot J. Swan as President and Mr. H. E.
Hemmings as First Vice President •of the Federal Reserve
Bank of San Francisco, effective January 1, 1966, at rates
of $46,000 and $31,500 per annum, respectively. These
rates, fixed by your Board of Directors, were reported in
your letter of November 18, 1965.
Sincerely yours,
WM. McC. Martin, Jr.
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Federal Reserve Bank of St. Louis
qtr7
BOARD OF GOVERNORS
Item No. 20
12/1/65
OF THE
•FEDERAL RESERVE SYSTEM
WASHINGTON, D. C. 20551
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
November 30, 1965.
Dear Sir:
by the
The Board of Governors recently had referred to it
ion U
of
Regulat
on
violati
t
Securities and Exchange Commission an apparen
litan
metropo
a
in
located
on the part of a sizable, experienced, bank
the Federal
financial center. After a preliminary investigation by
the bank to
for
counsel
asked
Reserve Bank of the District, the Board
facts reported
the
that
d
concede
explain the circumstances. Since counsel
that might
facts
nal
additio
no
offered
by the Commission were correct and
ion U
to
Regulat
on
attenti
of
lack
tend to indicate anything other than
in
credit
the
for
ible
respons
el
matters on the part of bank personn
the bank, with
question, the Board concluded that it was incumbent upon
to revise
hly
thoroug
very
Bank,
the assistance of the Federal Reserve
sory
supervi
asked
and
tion,
regula
its procedures in respect to the
the next
on
U
ion
Regulat
to
on
attenti
lar
authorities to exercise particu
examination of the bank.
extended
Essentially the facts were as follows: The bank had
a loan
under
n,
to X corporation a credit amounting to some $12 millio
ble
receiva
s
account
agreement that gave the bank a security interest in
This
aries.
subsidi
its
and inventories of the corporation and eleven of
ty departcredit was granted and administered in the factoring and commodi
question
the
to
l
materia
times
ment of the bank. It appears that at all
close
very
or
equal
amounts
in
d
before the Board, credit had been extende
nt.
agreeme
the
under
ral
collate
the
to the full loan value allocated to
tion
In April 1965, controlling stockholders in X corpora
million
$1.8
of
loan
further
a
that
l
approached the bank with a proposa
stock in
the
of
more
or
rds
two-thi
ing
purchas
be made for the purpose of
X is a manufacturer
Y corporation, a manufacturer of kitchen cabinets.
k.
and
millwor
and distributer of lumber
American
The stock of Y corporation is registered on the
mately the full
approxi
Stock Exchange. The $1.8 million loan represented
that at
lated
contemp
was
market price of the stock to be purchased. It
to be
shares
the
1965,
er
a stockholders' meeting to be held in Septemb
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
2 -
acquired with proceeds of the loan would be voted in favor of merging
the corporations, that these shares would then be cancelled, $1 million
of the total credit be paid off in cash, and assets and accounts of
Y added to the collateral held by the bank against the remaining loan,
which would then amount to $13 million.
At this point the record is not entirely clear. A controlling
block of stock in a solvent and profitable corporation has a certain
monetary value. The statement by the bank's loan officer that the prior
credit to X was fully extended under the terms of the agreement and that
Y stock purchased with proceeds of the additional loan was added to
collateral already held by the bank and the $1.8 million purchase price
to the existing credit of $12 million, permits the inference that the bank
relied on the stock in making the additional loan. During telephone
discussions of the matter, counsel for the bank stated to members of the
Board's staff that the bank held the stock in order to make absolutely
-certain that the shares would be voted in favor of the merger, in accordance
with an agreement with the borrowers. An explanatory letter from counsel
for the bank stated that the stock was taken merely as an additional
precaution and not deemed necessary to support the additional credit.
However, the letter also stated that the credit was extended in reliance
on the "pro. forma" consolidated position of X and Y after the merger.
Until the merger took place, the bank had no security interest in Y's
assets aside from the purchased stock.
Section 221.1(a), the general rule of the Board's Regulation U,
"Loans by Banks for the Purpose of Purchasing or Carrying Registered
Stocks", provides that
"No bank shall make any loan secured directly or
indirectly by any stock for the purpose of purchasing or
carrying any stock registered on a national securities
exchange . . . in an amount exceeding the maximum loan
value of the collateral, as prescribed from time to time
for stocks in § 221.4 .. . and as determined by the bank
in good faith for any collateral other than stocks."
It is clear that the $1.8 million advance in April was made for the
purpose of purchasing stock in Y, which stock is registered on a national
securities exchange. The Board was also of the opinion, under the facts
presented to it, that (1) the loan was "secured" by stock within the
meaning of the regulation, and (2) the amount of the loan exceeded the
maximum loan value of the collateral, determined in accordance with the
tests laid down in sections 221.1(a) and 221.4.
As to the first point, it is clear that whether the shares
were assigned their per/share market value as collateral for the loan,
or were valued as a block representing control of Y, or were held primarily
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
-3favor of a merger
to ensure performance of an agreement to vote them in
down in part and
paid
be
as the result of which the additional loan would
tment of the bank
depar
ring
assets more suitable for the commodity and facto
taken merely
were
they
substituted for the balance; or whether, finally,
was already
that
loan
a
as an additional precaution "to further strengthen
did
stock
Y
ased
purch
secure", as stated by counsel for the bank, the
serve to secure the loan.
ment between the
As to the second, it is apparent that the agree
extended
was
t
credi
bank and X under which the original $12 million
the collateral
of
value
included a "good faith" determination of the loan
a prudent
that
true
allotted to the bank under that agreement. It is
teral
colla
more
take
,
banker will sometimes, for his bank's protection
and that
t,
credi
given
a
rt
than he believes absolutely necessary to suppo
st the
again
on
milli
$12
than
the bank might have been willing to lend more
after
at
ed
arriv
,
value
loan
same assets. Nevertheless, the $12 million
le weight as a good
arm's length bargaining, should be given considerab
t the collateral would
credi
um
faith determination by the bank of the maxim
this collateral as
d
regar
not
did
support. The conclusion that the bank
gthened by the statement
sufficient to support the total credit is stren
a 212 forma consolidated
"on
in a letter from counsel for the bank that
after the merger of Y into
basis" the assets of the resulting corporation,
the bank had no way of asserting
X, would justify the additional loan. Since
gh the purchased stock, the
a security interest in Y's assets except throu
as an essential part of the
Board felt that the stock must be regarded
collateral for the additional loan.
pretation at 1959
Under guidelines laid down in an inter
although a controlling
Y,
in
stock
the
Federal Reserve Bulletin 256-257,
purposes at the actual price
block, should be valued for Regulation U
this price reflects intangible
paid for it, since it is to be assumed that
y, the loan value of the stock,
factors, including control. Accordingl
ation, was approximately $0.54
under the current supplement to the regul
the collateral taken together
million, and the total loan value of all
was well in excess of this
was $12.54 million. Since the total loan
in violation of section 221.1(a).
amount, it appears that the loan was made
the regulation provides
In addition, section 221.3(n)(1) of
that
teral used to
"The bank shall identify all the colla
(entire in221.1
g
of
ts
meet the collateral requiremen
collateral
and
loan
e
singl
a
debtedness being considered
.
.
being similarly considered
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
-4
and section 221.3(n)(3) adds the requirement that
"For any indebtedness that is not subject to § 221.1
. . . the bank shall in good faith require as much collateral
not so identified as the bank would require (if any) if it
held neither the indebtedness subject to g 221.1 nor the
identified collateral."
Accordingly, bank was required, when it made the $1.8 million
loan to purchase stock in Y, to identify the collateral used to meet
the requirements of section 221.1, and to require in good faith as much
collateral against the $12 million loan as it would have required had it
held neither the $1.8 million loan nor the identified collateral. Since
the maximum loan value of the purchased stock was $0.54 million, this
section required bank to identify, in addition, out of the collateral
held against the prior $12 million loan, collateral with a loan value
of some $1.26 million. This identification was not made, and had it been
made, would, it appears, have left a deficiency in the collateral held
ions
against the prior loan. For these reasons, it appears that the transact
violated sections 221.3(n)(1) and 221.3(n)(3).
The Board expressed to counsel for the bank the view that because
should
of the seriousness of the apparent violations described above, there
d
them
permitte
that
es
procedur
be a thorough review of the practices and
ate
to occur. It stated that after the review was completed and appropri
would
bank
the
if
it
te
controls established, the Board would apprecia
t, regarding
advise the Board, through the Federal Reserve Bank of the Distric
on U,
with
Regulati
ce
complian
ensure
to
procedures currently being followed
the
since
ed
institut
been
had
that
particularly details of all changes
matter was raised with the bank.
and
The bank involved in the above action was a national bank
ndence
for this reason the Board transmitted copies of relevant correspo
occasion
the
on
that
request
the
with
Currency
the
of
to the Comptroller
particularly
of his next examination of the bank, his examiners make a
n what
ascertai
careful review of its lending procedures in order to
of
ents
requirem
precautions the bank was taking to ensure that the
the
for
are
that
Regulation U are observed in connection with loans
securities
national
a
on
purpose of purchasing or carrying stocks registered
stock.
any
by
exchange and are secured directly or indirectly
Board's
In addition to the leading bank referred to in the
cent of the
per
34.5
some
letter, five other participating banks divided
nonmember
State
one
bank,
credit. These five banks included one national
leading
the
that
felt
Board
the
bank, and three State member banks. While
credit
the
that
bility
responsi
bank must be assumed to have taken primary
laws and regulations,
would be extended in conformity with applicable
ndence to the Federal
correspo
relevant
of
the Board also transmitted copies
the Districts
of
Banks
Reserve
the
and
Deposit Insurance Corporation
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
39,,7
attention to
concerned with the request that they give similar, special
of all the
Regulation U in their next examinations of the banks. Copies
to the
correspondence, including these requests, were also transmitted
Securities and Exchange Commission for its information.
Very truly yours,
Merritt Sh‘rma
Secretary.
TO THE PRESIDENTS OF ALL FEDERAL RESERVE BANKS.
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Federal Reserve Bank of St. Louis
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
Item No. 21
12/1/65
WASHINGTON, D. C. 20551
ADORERS Or/101AL CORRESPONDENCE
TO THE 'BOARD
December 1, 1965.
Mr. Joseph R. Campbell, Vice President,
Federal Reserve Bank of Philadelphia,
19101
Philadelphia, Pennsylvania.
Dear Mr. Campbell:
In accordance with the request contained in your
November
26, 19650 the Board approves the desigletter of
employees as special assistant
following
of
the
nation
examiners for the Federal Reserve Bank of Philadelphia.
Philmore Anderson, III
Gerald L. Gorman
Robert K. Hamm
Glenn E. Manthorpe
William M. Lewis
John J. Cawley
Appropriate notations have been made of the names
to be deleted from the list of special assistant examiners.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
°Z
(
BOARD OF GOVERNORS
Item No. 22
12/1/65
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON, D. C. 20551
A00141E013
ricsaL OORRIESIPONOCMCC
TO TH( BOARD
December 1, 1965.
Mr. Leland M. Ross, Vice President,
Federal Reserve Bank of Chicago, '
60690
Chicago, Illinois.
Dear Mr. Ross:
In accordance with the request contained in
your letter of November 26, 1965, the Board approves the
appointment of Harold E. Ford as an assistant examiner
for the Federal Reserve Bank of Chicago. Please advise
the effective date of the appointment.
Very truly yours,
igned) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
BOARD OF GOVERNORS
Item No. 23
12/1/65
OF THE
FEDERAL RESERVE SYSTEM
ACIORESS OFFICIAL CORRESPONDENCE
TO THE BOARD
December 1, 1965
Mr. E. H. Galvin, Vice President,'
Federal Reserve Bank of San Francisco,
94120
San Francisco, California.
Dear Mr. Galvin:
In accordance with the request contained in
Mr. Hemmingls letter of November 23, 1965, the Board
approves the appointments of Robert B. Fox and Gilbert A.
Lord, at present assistant examiners, as examiners for
the Federal Reserve Bank of San Francisco, effective
January 1, 1966.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
@FedFRASER