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A. meeting of the Federal Reserve Board was held in Washington °11 Tuesday, February 13, 1934, at 3:00 p.m. PRESENT: Mr. Mr. Mr. Mr. Mr. Black, Governor Hamlin Miller Thomas Szymczak 6 Mr. Morrill, Secretary Mr. Carpenter, Assistant Secretary Mr. Bethea, Assistant Secretary The minutes of the meetings of the Federal Reserve Board held P ebruarY 0 and 7, 1934, were approved. The minutes of the meeting of the Executive Committee of the Reserve Board held on February 5, 1934, were approved and the "tions recorded therein were ratified unanimously. The Board then considered and acted upon the following matters: Memorandum dated February 7, 1934, from Mr. Paulger, Chief of t11 0 Division of Examinations, recommending that he be authorized to egotiate with Mr. Patrick Joseph Winkler for his amployment by the "an assistant Federal reserve examiner, with salary at a rate ticIt to exceed C3,600 per annum, effective as of the date upon which he elaters uPon the performance of his duties. The recommendation was apIlt°vedb -Y five members of the Board on February 10, 1934. Approved. Memorandum dated February 7, 1934, from Mr. Paulger, Chief of the Di vision of Examinations, recommending that he be authorized to Ileeotiate with Mr. A. G. Lindquist for his employment by the Board as 44 as 8istant Federal reserve examiner, with salary at the rate of ..:4,500 De 4414, effective as of the date upon which he enters upon the per-1 ' 526 214/34 -2- tcatlance of his duties. The recommendation was approved by four members °t the Board on February 12, 1934. Approved. Memorandum dated February ?, 1934, from Mr. Paulger, Chief of the 14NIsion of Examinations, recommending the appointment of Mr. R. Thornt°4811°w as a file clerk in the division, with salary at the rate of $1,68n Per annum, effective as of the date upon which he enters upon the 11"'or11ance of his duties. The recommendation was approved by five menbera of the Board on February 10, 1934. Approved. Memorandum dated February 8, 1934, from Mr. Goldenweiser, Directcrit Ot the Division of Research and Statistics, recommending that the teZP°rarY appointment of Yr. Woodlief Thomas as a member of the staff of the d ivision be extended for an additional six months from March 8, 1934, 141cler the arrangement now in effect with the Federal Reserve Bank of New York. The recommendation was approved by four members of the Board on Feb rY 12, 1934. Approved. Memorandum dated February 9, 1934, from Yr. 4 -8401/ ead, Chief of the of Bank Operations, recommending the temporary appointment, for Deri °4 110t exceeding three months beginning February 12, of Mrs. Helen t, -4 as a clerk-typist in the division, with salary at the rate of month. The recommendation was approved by three members of the tottrA ' 011 February 10, 1934. Approved. 527 2/13/34 -3Memorandum dated February 12, 1934, from Yr. Wyatt, General C°Unsel. recommending that the temporary appointment of Mr. Ralph S. Tner as Special Assistant Counsel be extended for one additional month ect 'encing February 11, 1934, with salary at the rate of ç500 a month, 414 with the understanding that Mr. Tyler is not to be compensated for tr emeling or living expenses. Approved. Telegram dated February 12, 1934, approved by four members of tIle Board, to Mr. Case, Federal Reserve Agent at the Federal Reserve Bank t NeW York, reading as follows: "Your letter February eighth. Board approves designation of RaYmond 2. Schumacher as Examiner in Federal Reserve Agent's dePartment your bank at salary rate of c3,500 per annum. Please advise date commissioned." Approved. Telegram dated February 10, 1934, approved by four members of the 1,, ' °ard, to Mr. Williams, Federal Reserve Agent at the Federal Reserve 844k of Cleveland, reading as follows: "Your letter February sixth. Board approves appointment of J-ohn H. Reagan as Assistant Examiner in Federal Reserve Agent's den fartment your bank at salary rate of :1,800 per annum effective xeoruary 16, 1934." Approved. Letter dated February 9, 1934, from Mr. Williams, Chairman of the Federal Reserve Bank of Cleveland, advising of the appointment by boall of directors of the bank of Mr. W. H. Courtney, President of the p. ll'st National Bank and Trust Company, Lexington, Kentucky, as a cill*got r °- of the Cincinnati branch of the Federal Reserve Bank of Clever °1* the unexpired portion of the term ending December 31, 1934, 528 2/13/34 to -4- succeed Mr. C. N. Manning, resigned. Noted. Letter dated February 12, 1934, approved by four members of the ()arcl, to the board of directors of the "County Bank and Trust Company", Call:bridge, Massachusetts, stating that, subject to the conditions pre- in the letter, the Board approves the institution's application tot. membership in the Federal Reserve System and for the appropriate 842011at of stock in the Federal Reserve Bank of Boston. Approved. Letter dated February 12, 1934, approved by four members of the (141'd, to the board of directors of the "Fulton State Bank", Fulton, 411110iel stating that, subject to the conditions prescribed in the letter, ,,_ the Board approves the bank's application for membership in the Ilederal Reserve System and for the appropriate amount of stock in the 4deral Reserve Bank of Chicago. Approved. Letter to Mr. Hoxton, Federal Reserve Agent at the Federal Reaerv , ' bank of Richmond, reading as follows: "Receipt is acknowledged of the report of examination of The 1.11e.wha Valley Bank, Charleston, West Virginia, as of December 12, "1 33, and of Mr. Fry's letter dated January 16, 1934, pertaining : to the transaction whereby The Kanawha Valley Bank, a member bank, _equired certain of the assets and assumed the deposit liabilities the close of business October 7, 1933, of the Capital City a 'arlic, a nonmember bank. act. "From the information submitted, it appears that the transch,1°11 has not resulted in any material change in the general i7racte1' of the assets of The Kanawha Valley Bank or broadening the scope of the functions previously exercised by it within the nleanik," of the general condition under which The Kanawha Valley s'ILIC was admitted to the Federal Reserve System, and, in accordance with the recommendation of your office, the Board will interpose 2/13/34 -5- "no objection to the transaction." Approved. Letter dated February 10, 1934, approved by five members of the 4°13.rds to Mr. Wood, Federal Reserve Agent at the Federal Reserve Bank of St. Louis, reading as follows: "Reference is made to La.. Stewart's letter of February 3, 1934, inclosing a special memorandum prepared by one of your examiners With respect to the compliance with special conditions of membership ntxmbered 18 and 19 prescribed by the Board in connection with the aPPlication of the Peoples Bank of Indianola, Indianola, Mississippi, for membership in the System. "It will be appreciated if you will advise the Board if the three notes for „1,010 each, executed by three directors and substituted for other assets eliminated from the bank, were issued for a valid consideration, are legally binding obligations of the makers, !:td.are regarded by the respective makers as their individual liab ilities. The Board wishes, also, to be advised of the manner in Which payment was made of the notes totaling 4,515.96, signed by eresident Swartz and Cashier Moore. "While it was not contemplated that compliance with conditions rtumbered 18 and 19 would be effected in the manner reported, the Board will interpose no objection to the action taken provided that the notes executed by the three directors are legally binding obliTItions and that such notes will be paid in full within twelve months Z:riEtrillescyl=mo.f, the bank's admission to membership in the Federal Approved. )octra Telegram dated February 12, 1934, approved by four members of the to la". Walsh, Federal Reserve Agent at the Federal Reserve Bank of 1)4148 ' reading as follows: /)0 "Refer your wire February 8 re application Security State Bank, wi ,!!1111, Texas. Board grants extension of time to February 21, 1934, ""14 Which bank's admission to membership may be accomplished." Approved. Letter dated February 10, 1934, approved by five members of the 33° " c1) t ° Newton, Federal Reserve Agent at the Federal Reserve Bank or Sari zrancisco, reading as follows: 2/13/34 "Receipt is acknowledged of Lr. Sargent's letter of Xanuary 24, 1934) regarding member banks in your district which are still operating on a restricted basis, suggesting that these banks be advised that unless satisfactory plans for reorganizations are submitted Slid normal business resumed forthwith, membership in the Federal Reserve ystem will be canceled after hearings in accordance with the provisions of the Federal Reserve Act. Mr. Sargent reeuests advice of the Board's views, and instructions as to the proper procedure in the circumstances. "The Board feels that every possible assistance should be extended to member banks attempting to effect reorganizations. In cases, however, where a member bark has operated on a restricted ba313 for an extended period of time and has not been able to present a satisfactory Plan for reorganization, the 13oard feels that a reserve bank would be justified in taking such steps as are necessary to effect cancelation of its stock owned by the member bank, after having carefully considered, of course, the effect such action would be likely to have on the bank's further prospects for reorganization. It is noted from Lr. Sargent's letter that the Zastern Oregon Banking Company, Shaniko, Oregon, the Bank of Beaverton, 3eaverton, Oregon, and the Steiwer and Carpenter Bank, P°ssil, Oregon, were all placed on a restricted basis at the time or prior to, the national banking, holiday in March, 1933, and that such banks have been unable to submit satisfactory plans of feorganization. In view of these circumstances, the Board feels at the Eastern Oregon Banking Company, the Bank of L'eaverton, and Steiwer and Carpenter Bank should be advised that unless satisraetory plans for reorganization are submitted and normal business 213erations resumed by 1,:hy 1, 1934, proceedings will be instituted determine whether the stock in the Federal reserve bank owned ) _1. such member banks should not be canceled under the provisions or L:ection 9 of the Federal Reserve Act. "The Board has noted, also, the comments contained in Mr. Sarc,4(-enu t s letter to the effect that while the Pine City State Bank, 12,11:le City, ':iashington, has been operating on a restricted basis 'ILLY since December 29, 1933, there appears to be insufficient business in • the community to justify reorganization of the bank. :r doard feels, however, that the bank should be allowed a reasontime within which to effect a reorganization and that the .titution should be advised that unless satisfactory plans for : 14 reanization are submitted and normal business operations resumed 3-111Y 1, 1934, proceedings will be instituted to determine whether calei stock in the Federal reserve bank owned by it should not be .elcd under the provisions of Section 9 of the Federal Reserve 2,,etc "It is suggested that you also advise the above mentioned banks that eel", before their holdings of stock in the reserve bank are can: ( , 1 3 an opportunity for a hearing as provided for in the Federal l es " - -c :let will be afforded them, if desired. 531 -.7"Since it appears that the Yakima Valley Bank and Trust ComPanY, Yakima, Washington, has submitted a plan of reorganization Which may be effected, it is requested that no action be taken at this time by your office with regard to the termination of such bank's membership in the System. Approved. Letter dated February 12, 1934, approved by four members of the aitd, to "The Braddock National Bank", Braddock, Pennsylvania, reading as follows: "Reference is made to the application filed by you through the Federal Reserve Agent at the Federal Reserve Bank of Cleveland, for permission to exercise fiduciary powers under the provisions of section 11(k) of the Federal Reserve Act. "The Federal Reserve Board has considered this application and authorizes your bank to act, when not in contravention of State or local law, as trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver, committee cf estates of lunatics, or in any other fiduciary capacity in which State banks, trust companies or other corporations which COMB into • competition with national banks are permitted to act under the laws .?! the State of Pennsylvania, only in the specific trusts in which " Bessemer Trust Company had been appointed and was acting at the -Giza its assets were taken over by The Braddock National Bank, the !Zercise of such powers to be subject to the provisions of the FedrReserve Act and the regulations of the Federal Reserve Board. Action has been deferred upon your application for full fiduciary ) .1.°I7srs until after a report of the next examination of your institubion has been received." Approved. Letter to "The First National Bank of Danville", Danville, Iltialla),reading as follows: mi "The Federal Reserve Board approves your application for pertruste_n to act, when not in contravention of State or local law, as , u executor, administrator, registrar of stocks and bonds, luia lrdlan of estates, assignee, receiver, committee of estates of lt :ies, or in any other fiduciary capacity in which State banks, tri wi;,!4 companies or other corporations which come into competition st"" national banks are permitted to act under the laws of the or Indiana, the exercise of all such rights to be subject to the th Pr°visions of the Federal Reserve Act and the regulations of e Federal Reserve Board. 532 2/13/34 -8- "This letter will be your authority to exercise the fiduciary Powers as set forth above. A formal certificate covering such authorization will be forwarded to you in due course." Approved. Letter dated February 12, 1934, approved by five members of the 13°ard, to Mr. McClure, Federal Reserve Agent at the Federal Reserve Bank or Icarisa3 City, reading as follows: "Reference is made to your letter of January 16, 1934, inclosing the application of 'The Commercial National Bank of Kansas City', Kansas City, Kansas, for full fiduciary powers. "The Comptroller of the Currency recommends that action on this application be deferred until after the next examination of the bank, Which, confidentially, it is understood, Chief National Bank Examiner Wright has been requested to make in the near future. "The Loard concurs in the Comptroller's recommendation, and feels that detailed information covering the present trust department of the affiliated Kansas Trust Company should be available also in considering the subject bank's application. It is, therefore, requested that you arrange, if possible, to have your trust examiner make an examination of the trust department of the Kansas Trust CamPanY simultaneously with the next examination of The Commercial National Bank to be made by a national bank examiner. "The Board will defer action on the pending application until such examinations have been completed and reports thereof are made available, at which time it will be glad to have the benefit of any rlIrther recommendation you may wish to make in the premises. "The Board would also like to receive a copy of any contract or agreement entered into between The Commercial National Bank and the Xansas Trust Company at the time the latter institution's deposit -Liabilities were assumed." Approved. .Letter dated February 12, 1934, al:proved by three members of the toard, to the "First National Bank of Ogden", Ogden, Utah, reading as follOwa: "In addition to the authority heretofore granted to your bank act as trustee, the Federal Reserve Board approves your applica' e7n to act, when not in contravention of State or local law, as orecUt°r, administrator, registrar of stocks and bonds, guardian or ?states, assignee, receiver, committee of estates of lunatics, 111 any3' fiduciary capacity in which State banks, trust corn- 533 2/13/34 -9"Pantos or other corporations which come into competition with national banks are permitted to act uncter the laws of the State of Utah, the exercise of all such rights to be subject to the provisions of the i,'oderal eserve Act and the regulations of the Federal Reserve Board. "This letter will be your authority to exercise fiduciary P°wers as set forth above. A formal certificate covering such authorization will be forwarded to you in due course. "The Board feels that, if you are tendered any of the trusts flow held by the First Savings Bank, Ogden, Utah, the Thatcher brothers Bankin,!, Company, Logan, Utah, or the First Security Bank, Provo, Utah, you should carefully scrutinize the condition of these trusts and should not accept any of such trusts which, through their assumption may be detrimental to the interests of your institution. In this connection Particillar reference is made to those trust accounts and practices which were the subject of criticism by the national bank examiner in his reports of examination of the respective banks as of December 16, 1933, and which should not be permatted in the trust depart:lent of your bank." Approved. Letter to the overnors of all Federal reserve banks reading as foil OWs: "Upon agreement between the Federal Reserve banks affected, the , Iederal Reserve Board has approved the following changes in the inter-district time schedule for cash items: From Buffalo to Philadelphia Buffalo to Atlanta 2 days 3 IT To 1 day 2 days" Approved. Letter dated February 10, 1934, approved by five members of the " -I to Lr. Stevens, Federal Reserve Agent at the Federal Reserve Bank °r (jhlea_;0, reading as follows: of "The Board is in receipt of a letter addressed to the Comptroller the Currency by the First National Bank, Des Plaines, Illinois, • Of nlch the cashier of the bank states that at the last offering day4-;?: Treasury notes the bank received notice of the offering the the fter the bids had been closed and that they were informed by xederal Reserve Bank of Chicago that due to the short time the 2/1Z/34 -10- "Bank had to get out the notices it was unable to get offerin .s to all banks on time. The cashier of the bank asks why it should not have been given an opportunity to subscribe for 'certificates of this issue'. "It will be appreciated if you will advise the Board of the . time when you received notice of this issue, when advice thereof was given to banks in your district and whether banks throuhout the district generally received such notice in time to permit them to subscribe thereto. If advice of such issues of government securities is not received by your bank in time to get notices thereof to all banks before the offerings are closed, the Board will appreciate any sugestions relative thereto which you may wish to offer." inDroved. There were then 1)resented the following applications for oriinal Or additional stock, or for the surrender of stock, of Federal reserve banizs: 4bl ications for ORIGINAL Stock: Shares National -E -Of Clementon, Clementon, New Jersey 45 45 51 Cl Ili-strict No. 4. 1s Fit Bank in Cambridge .Prings, Cambridge Springs, Pennsylvania uistrict No7* ljtlea National Bank, ntiea, ?1t National Hank In Viroqua, Viroqua, Wisconsin ,,ati-ict Mo. The Pirst 4a4-8' ional Bank in 1.: , arianna, Irianna, Arkansas J-rat N ational Bank in Owenton, °I7enton, Kentucky kat -qz'at National Bank in Geer/7,e iest, Ceore West, Texas ItiO. 12. tilb1.11'11 National Bank, Auburn, tishinp;ton 36 36 72 33 33 66 36 36 36 Total 36 306 535 2/13/34 -11- 4 lioations for ADDITIONAL Stock: Washington, D. C. 1114ct No. 7. 11'11161"""Eta — Bank of Belvidere, Illinois, Belvidere, Illinois The Illinois National Bank & Trust Co., Rockford, Illinois 1).ave11port Bank & Trust Co., D avenport, Iowa District No. 9. Noples State Bank, Plainview, Minnesota District No. 11. First National Bank, Darrouzett, Texas Pirst National Bank) , Mission, Texas .rirst National Bank of Yount Vernon, Mount Vernon, Texas Citizens National Bank, SoUr Lake, Texas The Angleton State Bank, Angleton, Texas Citizens State Bank, , Greenville, Texas Bank & Trust Co., Buntsville, Texas A h Shares 300 300 15 15 60 90 3 3 1 40 1 14 1 3 Total 66 459 1 ..ications for SURRENDER of 3tock: 4Jistrie The National Bank of Girard, Girard, Pennsylvania ,elrat National Bank, rslree41110, Kentucky District No "1°48.1 Bank7* , of Niles Center, Niles Center, zirst Illinois National Banks 1,t1?"Pelier, Indiana 4 Natiotal Bank, "4141shall, Michigan 111 39 150 90 45 75 210 536 2/13/34 -12- A lications for SURRENDER of Stock: 11. Alm° Nati 7 .m1: 8 7-3.Bank, San Antonio, Texas .alallEk No. Continued) District No. 12. First National Bank, Olive, California Oarlital National Bank, „,„ (31YmPia, Washington l'ae Central National Bank of Commerce, Seattle, dashington Shares 480 480 20 150 150 Total 320 1,160 Approved. Thereupon the meeting adjourned. Secretary. vernor. r
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