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FEDERAL RESERVE BOARD WASHINGTON December 2, 1922. VEMOFANDLE q0TM 1:44V7,17: The undersigned request that y:..0 call a special meeting of the Federal ',Reserve Board for today, Saturday, December 2, 1922, at 10:15 a.m. g A s/)ecial meeting of the Federal Reserve Board. was held in the 10:15 A. office of the Federal Reserve Board on December 2, 1922, at PIESITIT: M. Vice Governor Platt Er. Hamlin er Hr. Mr. Mit che 11 Mr. Crissinger Mr. Hoxton, Secretary. The Vice Governor stated that he had. called the meeting in accordance with the written request of three members of the Board as provided for in the By-laws. Minutes of the meeting at' the Federal Reserve Board held on November 29th, were read and on motion approved. 2he Vice Governor reported the reserve positions of the several Federal Reserve banlis as at close of business November 29, 1922. Letter dated November 24th, from the Chairman of the Federal Reserve Bank of San Francisco, requesting the Board's approval of the proposed purchase by the Federal Rei;erve Ban): of San Francisco, of a building in Portland for the use of the Portland Branch, it being set forth that the lease upon the quarters occupied by the Portland branch will expire on January 31st, and that althouc,h an extension of the lease mijit be arranged, a higher rental will be charged. Mr. Perrin further observed that between now and January 51st there is obviously too little time to go into the matter recasting the organization of the service rendered by the Federal Reserve Bank of San Francisco through the northwest branches. After full discussion, the Secretary was directed the following telegram over the si,nature of transmit to "Your letter November 24th. Board withVice Governor: the out dissenting vote is of the opinion, with such information as it has, end in the interest of more economical operation of your Pacific Northwest branch service, that question of consolidation of the three present Northwest branches should 12/2/22 be settled before any provision is made for permanent quarters at any of these places. The Board is gratified to learn that temporary lease on your ql:arters at Portland can be secured and vill expect a final recommendat ion and plan from your board with respect to the Horthrest branch consolidation before the termination of your extended lease." Mr. Hamlin stated that while he voted for the approval of the telegram he had reached no conclusion as to the merits of t,.e question, but rould await the report of the Fe.,eral Reserve rank of San Francisco. Telegram dated December 2nd, from the Chairman of the Fecleral 'Reserve Bank of Boston, advising of the re-election of Mr. 2rederick S. Chamberlain as Class "A" Director, and Mr. ,]d,lond R. Morse as Class "B" Director of the Pederal Reserve Bank of Boston, and requesting advice as to when it is satisfactory to the Federal Reserve Board to have the result of the election published. Noted. The Secretary was directed to advise Mr. Curti ss Board has no objection to the publication at the the that present time of the results o: the election. Draft of circular letter dated November 29th, addressed to all Federal :Reserve Agents, except the Agents at Hew York and Chicago, on the subject Of the "prearation of the Annual Rep rts of Federal Reserve Pent s." Approved. Telegram dated December 1st, from the Chairman of the FeJeral Reserve of Dallas, announcing the election of Mr. '7. R. Patrick, President of the First National Bank, Claredon, Texas, as a Class "A" Director of the ?ederal Reserve Bank of Dallas, and the re-election of Mr. Marion Sansom 48 Class "B" Director. No ted. 12/2/22 -3- Bond of Yr. 0Ohn q. Fry, Assistant Federal Reserve Agent at the Federal Reserve Bank of Richmond, dated, 7oveMber 21, 192, in the sum of ?50,000. Approved. Memorandum dated ecerjber 1st, to the Vice n,overnor of the 7oard from the Assistant Secretary, as follows: "Dr. 'Allis has advised me that while he was connected rith the Board, he had bound for his personal use all circular letters issued by the Board prior to 1921. He has asked me to request the Board to furnish him with copies of such circular letters as were issued during 1921 ahd during the period of 1922 in which he served as Director of the Division of Analysis and Research. He -ants to have these circular letters bound to ,comjlete his set, aesiring to have in his personal files copies of all circular letters issuej by the Board during the time of his service \rith it. He states that if among the letters he desires there are any that are of a strictly confidential nature :culd not wish him to have, it would. be satiswhich the Board , factory to him for the Board to withhold such letters. Dr. 71.11is has also requested permissicn to consult the stenographic report of the Conference held by the Board with the offiers and directors of the Federal Reserve banks and rembers of the Preliminary Organization Committee on October 21, 1914. Fe states that he has a personal copy of this report, but same is in storage and not readily accessible. He asks that the Board's file copy be sent to him, with permission to retafh it for a few days. I respectfully request that the Board advise me of its decision in this matter." Approved. The Secretary was directed to Frp over the circular letters, copies of rhich, requested by Dr. with a view to withholding those which may be of a strictly confidential nature. Letter dated November 25th, from the Federal Reserve AP.ent at ci - sco, transmitting copies of certain corresondence had between Yr. Perrin ' 11L1hr. . S. Dodge, su-)erintendent of Banks of the State of California, rethe appliction of the Bank of Italy for ')ermission to estrblish a 1)ranch in .the city of santa Noted.' -4- 12/22 Letter dated 10evenber 25th, from th ,J Assist- nt Federal Reserve Agent at San Francisco, enclosing copy of a letter received from the Security Sank 6: Trust Comoany of San Francisco, withdrawing their application to establish a branch office on iiission Street near Second Street in San Francisco, permission to establish such branch having been previously given by the Federal Reserve Board. Noted. Letter dated November 25th, from the Federal reserve Agent at San Francisco, transmitting with favorable recommendation, the application of the Security Trust 6: Savings Bank of Los Angeles, to take over the First National Bank of Burbank and the Burbank Savings Bank, the First National Sank of Montebello, and the 1.1ontebello Savings Bank, and to establish one branch each in the towns of Burbank and Liontebello. Approved, hr. Orissinger voting "no". Er. Crissinger further protested against the extension of branch banking in California because of the abuse of the discretion of the State Banking Department of California in the granting of these great number of permits for branch banks: that the abuse had become so acute that it amounted to setting aside of the banking laws of California, which provided for the examinations of State banks; that the abuse of such discretion in the granting of these permits by the State Banking Department put upon the Federal Reserve Board the duty of withholding their approvla because the failure of the State to properly superintend banks imposed a duty upon the Federal Reserve Bank which the Federal Reserve Bank was not able, throug4 its examining department, to properly perform; that it amounted to a raud upon the people of California to hold out that these banks with their great number of branches were being properly examined, when as a matter of fact, they could not be properly examined by either the State of California or by the -5- 12/2/22 Federal Reserve Bank, for want of a sufficient trained examining force; yet, the bnnks at the same time were holding themselves out as being under supervision of the Federal Reserve System, and being improperly supervised, amounted to a fraud upon the people. Letter dated November 24th, from the Federal Reserve Agent at San Francisco, transmitting with favorable recommendation, the appliCation of the Mercantile Trust Company of San Francisco, to take over the Petaluma. National Bank and the California Savings .Bank of Petaluma, and to convert them into one branch of the Wiercantile Trust Company. Aeproved, Lir. Crissinger voting "no". Upon motion duly seconded, the Board approved Resolutions of the Federal Reserve BanL of Chicago, the Federal Reserve Bank Of Minneapolis, the Federal Reserve Bank of Dallas and the Federal Reserve Bank of Boston, providing that a dividend for the six months' period ending December 31, 1922, be declared to all stockon holders of the said banks, as shown by the books af the banl,s that date. Letter dated Noveinber 29th, from Mr. Gilbert R. Lansdale, tendering his resignation as a temporary employee in the Division -6- 12/2/22 of Bank 0rations, ef:Cective as at close of business, December 6, 192r,. ...c3epted. There ensued a discussion of the attitude to be taken by the Board with respect to the loan of the examining forces of the Federal Reserve banks to assist State authorities in the examination of State Bank members. Upon motion, kr. Harlin was reiluested to secure from General Counsel an opinion as to the legal pavers of the Beard and the Federal Reserve banks with respect to makinr. examinations and investigations of member banks other than the special examinations provided for in the Act, Sections 9, 11 and 21, and for the cost of wdich the exarined member banks mast ray. The Secretary was instructed to record the following tentative Pr.00csals and program to be discussed by the Board. at a continuation af this ru1in to be held next 1.1onday at 10:30 A. LI. 1st: It is proposed, that in all districts, member ban's shall be required to pay for all special examinations made of them by the Federal Reserve banks provided that inquiries with reference to the loan or credit policy of a nember bank made witb it; consent is not to be regarded as a special examination. 2nd: It is proposed, that Federal Reserve Banks shall not be authorized to engage in joint examinations wi th State authori ties. 12/2/22 -73rd: It is pronosed that Federal .leserve banks shall not be authorized to lend, with or without compensation, any of their examinimg forces to any State Examining Dep art me n t If any of the above proposals are adopted as the -policy of the Board this proposition follows: 4th: ?hat Federal Reserve bans shall be authorized and di re cted to rake thorough special examinati Oils 'ihenover, in their judgment, State Banking Department examinations are inadequate or otherwise unsatisfactory. Vith reference to the branch ban:;,_ situation in California, L'Ir. suggested th,t the Board adopt the view that the Bank of Italy of Sall Francisco has reached the limit of branch expansion and that therefore Other California banks will be allowed to go to the limit reached by the of Italy and no farther. 132ZtR,T8 OP CO;LITThE 10. 1: lated November 29th December 1st Lated Navel-riper 28th ated.1:ovember 29th 1)ated November 29th Recommending action on ap-olications for changes in stock as set forth in the Auxiliary :,:inute Book of this date. rov ed. Recommending act ion on appli cat ion for admission of state bank, subject to the conditions stated in the individual reports attached to the aTlication, a-; set forth in the Auxiliary 7,1inute Book of this date. Appr oved Recommending approval of the application of :Ir. Andrew *:1. Ear-oar to serve at the same time as director of the Llutual National Bank and "lashing,ton Park National Bank, both of Chicago, Appr oved. Recorrriénding a-onroval of the application of Er. Vir. L. 0'Connell to se rye at the same time as director of the 71n shirmt on Park National Bank and the Southside Trust & Savings Sank, both of ChicwA), At 1:25 P. :i. a recess was taken until 10:::)0 Li. Monday, 143 cember 4th. l'1))1'oved: Secret ary.
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