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1391 e A. meeting of the Board of Governors of the Federal Reserv 1936, at 9:45 System was held in Washington on Friday, December 30, a. m. PRESENT: Mr. Mr. Mr. Mr. Mr. Mr. Eccles, Chairman Ransom, Vice Chairman Szymczak McKee Davis Draper Mr. Mr. Mr. Mr.. Morrill, Secretary Bethea, Assistant Secretary Carpenter, Assistant Secretary Clayton, Assistant to the Chairman hereinThe action stated with respect to each of the matters after referred to was taken by the Board: of the The minutes of the meeting of the Board of Governors approved unaniFederal Reserve System held on December 29, 1938, were mously. the Telegrams to Messrs. Kimball and Post, Secretaries of tively, and Federal Reserve Banks of New York and Philadelphia, respec Bank of San FranMr. Holden, Deputy Chairman of the Federal Reserve ishment without change cisco, stating that the Board approves the establ er 27, by the by the Federal Reserve Bank of San Francisco on Decemb 1938, and by the Federal Reserve Bank of New York on December 29, the rates of discount Federal Reserve Bank of Philadelphia today, of and purchase in their existing schedules. Approved unanimously. 1392 12/30/38 -2- Telegram to Mr.. George C. Brainard, Deputy Chairman of the Federal Reserve Bank of Cleveland, reading as follows: "Board of Governors has rescinded action taken on al December 20 in appointing you deputy chairman of reder desig has Reserve Bank of Cleveland for coming year and at Cleve nated you as chairman and rederal reserve agent land bank on honorarium basis for 1939. "Board has fixed your compensation as Chairman and the Federal reserve agent on the uniform basis fixed for at same position at other Federal reserve banks; i.e., le durthe same amount as the aggregate of the fees payab dance ing the same period to any other director for atten of direcboard the of ngs meeti at corresponding to yours the board tors, executive committee and other committees of advise will you if d ciate appre be of directors. It will by wire of your acceptance. neces"In accordance with usual procedure it will be rate corpo and sary for you to execute usual oath of office bond ted surety bond in amount of 4;100,000. When execu ve Bank of should be examined by counsel for Federal Reser with dance accor Cleveland to see that it is executed in sent and 181 bond rules printed on reverse side of form of to Board Promptly for approval." Approved unanimously. In accordance with a recommendation con1938, tained in a memorandum dated December 30, to ct subje from the Personnel Committee, and t, accep confirmation of his willingness to gton, Dean G. Acheson, of the law firm of Covin , ngton Washi Burling, Rublee, Acheson (;,; Shorb, of tor direc D. C., was appointed a Class C a the Federal Reserve Bank of Richmond for 1939. 1, ry Janua term of three years beginning Messrs. Szymczak and McKee requested the that they be recorded as not voting on nnel Perso the of foregoing recommendation of Committee with respect ta the appointment ve Reser al reder the a Class C director of beBank of Richmond for the three year term that n ginning January 1, 1939, for the reaso reapthe present incumbent is eligible for agreed pointment under the policy heretofore Class to by the Board of Governors whereby a :1393 -3- 12/30/38 C director can be appointed to succeed himself provided his period of service has not been six consecutive years and, further, for the reason that the information developed and in presented had not been of such character, ent the pres fy uali disq their opinion, as to tment. incumbent, Mr. Sherwood, from reappoin ident, Maryland Car Letter to Mr. Donald H. Sherwood, Vice Pres reading as follows: Car Wheel Company, Baltimore, Maryland, end of this month "In view of the expiration at the ctor of the Federal Reof your service as class 'C' dire ers of the Board, acting serve Bank of Richmond, the memb e you on behalf of the unanimously, have asked me to writ service which you have Board a letter thanking you for the em. rendered the Federal Reserve Syst ess the hope that in the expr d Boar the "The members of interest in the welyears to came you will continue your nd to you their best wishes fare of the System, and they exte for good health and happiness." McKee Approved, Messrs. Szymczak and ed. stat ly ious prev not voting for reasons of the Federal Reserve Bank of Letter to Mr. Young, President Boston, reading as follows: December 27, 1938, the "Referring to your letter of to Mr. Dana D. Sawyer, Board approves payment of a salary Division and Alternate Manager of the Securities Exchange the rate of 3,200 Assistant Federal Reserve Agent, at 1939." per annum, effective January 1, Approved unanimously. t of the Federal Reserve Bank Letter to Mr. Rounds, Vice Presiden of New York, reading as follows: recommendations contained in "In accordance with the the , the Board approves your letter of December 23, 1938 rt Robe Mr. and er C. Coop payment of salaries to Mr. Norman ts, at Agen rve Rese ral t Fede W. Bullock, Alternate Assistan , efannum, respectively per 00 03,2 and 00 43,5 of the rate ." fective January 1, 1939 Approved unanimously. 1394 -4- 12/30/38 Letter to Mr. Rounds, Vice President of the Federal Reserve Bank of New York, reading as follows: "Reference is made to your letter of December 27, 1938, requesting the Board's approval of the payment for an additional period of six months of a salary to Mr. Harry G. Tappen in excess of the salary provided for the position he is temporarily occupying. "In view of the circumstances stated in your letter the Board approves, for the period of six months from January 1, 1939, the payment of a salary to Aft'. TapPen at the rate of 0,700 per annum as Supervisor in the Work Relief Checks section, which salary is .;.700 in excess of the maximum provided for the position in the personnel classification plan of your bank." Approved unanimously. Letter to Mr. Nardin, Chairman of the /ederal Reserve Bank of St. Louis, reading as follows: "In accordance with the recommendation contained in your letter of December 21, 1938, the Board approves the payment of a salary to Mr. John A. Links, Iederal Reserve the Agents' Representative at the Little Rock Branch, at 1939." 1, y Januar ive effect rate of .2,400 per annum, Approved unanimously. l e Telegram to Mr. Young, Vice President of the Federa Reserv Bank of Chicago, reading as follows: "In accordance with your recommendation Board will Green interpose no objection to proposed merger of Bank of Green of both Bank', Bay and 'Peoples Trust & Savings uBay, Wisconsin, under the charter of the latter instit 22, and 5 er Decemb of tion as outlined in your letters contracts, 1938 and inclosures, provided the proceedings, opinion the in are, ith therew and agreements in connection affect not do and ive of your counsel, legally effect a member legal status of Peoples Trust & Savings Bank as appropriate by ed approv is ction the that transa and bank, copies of State authorities. Please furnish Board with n, agreeoratio incorp any amendments to bank's articles of " ction. transa ments or contracts pertaining to the Approved unanimously. 1395 12/30/38 -5- Memorandum dated December 28, 1938, from Mr. Smead, Chief of the Division of Bank Operations, stating that the form of balance sheet to be used by State member banks in submitting reports of condition will hereafter show interests of stockholders under the caption 'Capital Account' instead of under the caption 'Liabilities' as heretofore, and that the reasons which prompted a change in this form will apply as well to the form of balance sheet used by the Federal reserve banks. The memorandum recaumended, therefore, that beginning with the first weekly statement of condition of Federal reserve banks to be issued in 1939 the capital accounts of the Federal reserve banks be shown separately from their liabilities under the caption 'Capital Accounts', and that certain other changes occasioned by this change, as set forth in the memorandum, be made in the statement. Approved unanimously. Telegram to the Presidents of all Federal reserve banks, reading as follows: "Chairman of Presidents' Conference Standing Committee on Collections has advised that in Committee's report of December 17, 1937, words 'nonmember clearing banks' were inadvertently omitted after words 'member banks' in paragraphs relating to direct routing of noncash items to other Federal Reserve districts. It appears that present circulars of some Reserve banks include nonmember clearing banks under direct routings and others do not. In circumstances Board will offer no objection to inclusion by any Federal Reserve bank that wishes to do so of words 'and nonmember clearing banks' after words 'member banks' in first line 1396, -6- 12/30/38 "of last paragraph beginning on page 2 of its letter S-132 of December 17, 1938, and after words 'member banks' in second line of last paragraph of that letter." Approved unanimously. Memorandum dated December 28, 1938, from Mr. Morrill referring to the action of the Board on December 23 authorizing the Federal reserve banks to pay in 1938 the amount scheduled to be paid in 1939 on ended by prior service liability to the Retirement System, as recomm and stating that the Conference of Presidents at their recent meeting, this action contemplated that a similar payment would be made by the e ity. Board covering the amount remaining on its prior servic liabil amount of The memorandum recommended that this payment, in the $81,685.44, be authorized. Approved unanimously. Upon recommendation of the Personnel Committee the Secretary was authorized to negotiate a new contract with the Welfare and Recreational Association of Public Buildings and Grounds, Inc.', covering the operation of the cafeterias, snack bar, and dining s rooms in the Board's building, which expire on December 31, 1938; with the understanding y that the new contract would be on substantiall the same basis as that now existing except that it would provide (1) that fifteen percent of any profits due the Board for any one month shall be paid to the manager of the cafeterias and dining roams and five percent of any such profits to the assistant pay manager, (2) that the Association shall serone teleph the Board $5.00 per month for 00.00 s, vice in addition to toll charge per month for steam, 05.00 per month for 1399 12/30/38 electricity, and the full amount of the monthly gas bill submitted by the gas company so long as the Association continues to be the only user of gas in the Board's building, and (3) for the termination of the contract by the Board at the end of any calendar month by notice in writing prior to the first day of the month and by the Association at the end of any calendar month by notice in writing prior to the first day of the preceding month, although the Board may agree to a shorter period of notice of termination by the Association. Thereupon the meeting adjourned. Chairman.