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167 Upon call of the Vice Governor, a special meeting of the Federal Reserve Beard was held in the office of the Vice Governor on Thursday, February 18, 1926 at 3:00 p.m. PRESENT: Vice Governor Platt Mr. Hamlin Mr. Miller Mr. Cunninfjhan Eddy, Secretary Mr. McClelland, Asst. Secretary The Vice Governor stated that the purpose of the meeting was to consider a telegram dated February 18th from the Federal Reserve Agent at Chicago, c°11firming recommendation made over the telephone by the Agent and Governor Ot the Bank that the Board approve a proposed absorption of the Clark National Ballict Newton, Iowa, by the Jasper County Savings Bank, a member bank of that 1514°e, together with a memorandum from the Secretary advising of conversation the telephone with the Federal Reserve Agent and Governor of the Federal 1168"re bank and setting forth that in addition to their recommendation the baorption is favorably recommended by the Comptroller of the Currency; the 880 1‘eterlr also stating tlaitt the Federal Reserve Agent advised that he felt atize that the state banking authorities would approve of the absorption. The Secretary stated verbally that the Comptroller of the Currency had requested that he be recorded as favoring the consolidation. After discussion, Mr. Miller moved that in view of the fact that the proposed absorption has the approval of the Comptroller of the, Currency, the Federal Reserve Bank of Chicago through its Governor and Chair, man, and the Chief National Bank Examiner, the Vice Governor be authorized to anorove it on behalf of the Board on receipt of information that the Superintendent of Banking of the state of Iowa approves. Carried. 168 —2- Mr• Miller then presented a copy sent to him by the Federal Reserve Agent Or 1/4_ 4-uae apolis, of the written statement read by him at the meeting of the 13°4rd. on February 2nd., with respect to the responsibility of a Federal Reserve Agellt in making recommendations in connection with the issuonce by the Comptroller the Currency of charters for rational banks, particularly .where the new insti— tIlti011 is organized, to take over an existing bank in poor condition. Mr. Miller stated that Mr. Mitchell desired to have this statement made a part of the Board's 4cerds, Noted. asport of Committee on Examinations on letter dated February 15th, from tha Peelers.). Reserve Agent at Minneapolis, transmitting and recommending approval (It ail aPplicatiofl of the Bank of Philip, S. D., for permission to consolidate the Of Nowlin, S. D.; the Committee also reconmiending approval. Approved. The Board then considered the revised draft of the By—lews of the Board ee tentatively approved at the meetings on January 26th and Febru.ary 4th. The "retallY stated that Mr. James before leaving Washington had suggested a further azziericbment to the first sentence of Article VII so as to make it read as follows, the 11617 matter being underscored "In FiMition to the .ecutive Committee there 641.i 4 be the following Standing Committees, appointments to which shall be made the Governor, sub 'ect to the ao royal of the Board.." fl After discussion, upon motion by Mr. Miller the amendment above suggested was approved. Upon motion by Mr. Cunningham, it was then voted that the revised By—laws, in the following form, be formally adopted, effect ive :larch 1, 1926: 169 2/18/26 ••30.•1111 Article I. The Chairman. at Zle Secretary of the Treasury, as Chairman of the Board, shall preside sh when -present. In the absence of the Chairman, the Governor 0.0„ 411 . act as presiding officer. In the absence of both the Chairman and the suvezzor, the Vice-Governor shall preside, and in the absence of all. three Officers, the remaining member of the -.'ixecutive Committee shall preside. Article II. The Governor. (/' exe Sec• 1. The Governor of the Federal. .serve Board shall be the active allfacttive officer thereof; subject, however, to the supervision. of the Board 60 such rules and regulations as may be incorporated herein or mar from tc,0 tirao„ by resolution, be established. rotzt.'"ee. 2. The Governor shall have general charge of the executive and ille hrasiness of the Board not specifically assiF,ned under the by-laws or s'I'ml:esolution of the Board to anti individual meaber or committee thereof, and have survision of the Board's staff. 3. The Governor shall be an ex-officio member of all Standing -441ttees of the Board. Article The Vice-Governor. be 0,3e°. is In the absence or disability of the Governor, his powers shall Or ,.14 .el'e ised an1 his duties dischargea by the Vice-Governor, and in the absence eizeu•lalsability of both of these officers, such powers shall be exercised and the ( 1, 1'Ities discharged by the remaining member of the Executive Committee; in rl'usence or disability of all manbers of the Executive Committee the -powers t)ree -l'Ities of the Governor shall be exercised by the senior member of the Board See• 2. It shall be the duty of the Vice-Governor to cooperate with the kv.e.,,, in the administration of the executive 'ousiness of' the Board. Article IV. Secretary and Assistant Secretaries. teer Sec• 1. The Board shall appoint a Secretary and one or more assistant etaries, , . an accurate record of the proceedings ot See• 2. The Secretary shall keel) az Ile Board and shall conduct such correspondence and pe rforra such other duties be assiied to him by the Governor or by the Board. In the absence or 1.70 1 2/18/26 )?.?sability of the Secretary, the duties of that office may, by direction of 3oard., be performed by an assistant secretary. Sec. 3. The Secretary shall have custody of the seal and, acting ,441.13.(ter the authority of the Board, shall have power to affix same to all strwmDlats requiring it. Such instruments shall be attested by the Secretary. racvbe See. 4. The assistant secretaries shall each oerform such duties as - assie,ned to than from time to time by the Board or by the Secretary. Article V. Assistant to the Governor. 6ec. 1. The Board may authorize appointment of an Assistant to the -ernor. Sec. 2. The Assistant to the Governor shall perform such duties as shall b C assigned to him by the Governor. GOIn. Article VI. The Executive Committee. See. 1. There shall be an Executive Committee of the Board consisting o the lree nocmbers, which shall include the Governor, Vice-Governor ana one of allro a B1DPcintive members of the Board. The appointive member of the Committee t11;, ] ; be nominated and elected at a regular meeting of the Board. Members of e(Itia ara shall serve as far as practicable in rotation and for approximately a,eti telms. The presence of three members shall be requisite for the trams04 011 of business by the Executive Committee, and action shall be taken only nimous vote of the Committee. Soc. 2. In the absence of the Governor and Vice-Governor the appointive ' othe r Of the Executive Committee shall act as Chairman and shall, with two . aPpointive members of the Board present in Washington to be chosen by cltiti 12 the order of their seniority, exercise the powers and discharge the of the Executive CoLimittee. In the absence of all three regular members 1)1,011 (5 -. -'ixeoutive Committee the three remaining appointive members of the Board, ezelticl .ea there be three in Washington, shall act as an interim committee and sezu,ise the powers and discharge the duties of the Executive Committee, the ' r member acting as Chairman. t, Sec. 3. In the absence of a quorum of the Federal R - eserve Board and cliariline t ransaction only of business of a routine character requiring action tra4as the absence of such quorum, the Executive Committee is authorized to v7itla act business of an executive nature which can be transacted in accordance ell established principles and policies of the Board and to perform such aaaij iriatrl°11a1 duties as may be specifically delegated to it from time to time by ti°n Of the Federal Reserve Board; to review and submit drafts of im1)ori the 17 correspondence involving the expression of opinions or decisions of the 13°arat and to prorAre and make recommendations governing the conduct of 1 oara's business. k 1_71 2/18/26 Sec. 4. The Executive Committee shall also have charge of all matters aPpert: • • m, - -aralng to the internal organization of the Board, and shall make recom7.13dations from time to time on this matter. It shall also prepare annually 4 bude;et of proposed exnenditures. The Secretary of the Board shall serve as Secretary of the Executive 00 it • tee. Article VII. Standing Committees. In addition to the Executive Committee there shall be the following Starla. s . 14g Committees; anpointments to .Which shall be made by the Governor, -oject to the approval of the Board. Sec. 1. Law. To the Law Committee shall be referred for study and report all cNes „, t' 1ons of a legal nature. .To this CoMmittee shall also be assigned the to ation or revision of the Board's regulations, contemplated amendments 01. 4e Federal Reserve Act, applications under the Kern amendment to the , ' *1.1t°11 Act, and aop .- lications for the exercise by national banks of trust 4,01ars, The General Counsel shall serve as Secretary of the Committee. Sec. 2. Examination. the To this Committee shall be referred all questions relating to etate a/ntaation of Federal Reserve or member banks including admission of and permission to establish and operate branches. The Chief Examiner shall serve as Secretary of this Committee. Sec. . Research and Statistics. This Committee shall have charge of all investigations of an ec0/10-2 vise V-c and statistical character authorized by the Board and shall super.2 wo Resarchk of the Division of Research and Statistics and. the preparation have=llulication of the Federal Reserve Bulletin. This Committee shall also , suPervision of the statistical and publication work of the Federal Reserve a erve The Director of the Division of Research and Statistics shall a of tins Committee, or in his absence the Assistant Director o =e. et rY Sec. 4. Salaries and ExPonditures of Federal Reserve Banks. Peciera Oornt To this Committee shall be assigned all recommendations from aeserve Banks for changes of salaries and other expenditures. This ee shall make ranorts with resrect to charge-offs and franchise tax “keral Reserve Banks. 172 r 2/18/26 .-6— The Secretary of the Board shall serve as Secretary of this Committee. Sec. 5. District Committees. To each Federal Reserve Bank and Dts trict shall be assigred a rm,11,,!.ttee of not less than two members of the Federal Reserve Board. It shall be 71 " 4e duty of each Committee to koer itself informed by correspondence and cf the affairs of the Bank and the condition of the District, and ma133 .pe,e3tigatiOn. and report on all questions appertaining to the oneration of any al deserve Bank or the condition of any Federal Reserve District that may be l'eferred to it by the Board. These Committees shall also aid the Committee '1e and. Expenditures with information regarding oiersonnel of the respec41se Pederal Reserve Banks of vihich they have charge. These Committees shall pea !illalop recommendations to the Board for the appointment of Directors at 2,eserve Banks and Branches.. Article VIII. The Fiscal Agent and Denut7 Fiscal Agent. Sec. 1. The Board shall appoint a Fiscal Agent :1111 a Deputy Fiscal 2he duty of the Fiscal Agent shall be to collect and deposit all moneys -Lvable by the Board with the Treasurer of the United States, to be placed sDecial fund established on the books of the Treasurer for the Federal , . / 1 4y4L1 t7e Board. The Deputy Fiscal Agent shall perform the duties of the Fiscal during his absence or disability. Sec.. 2. The Fiscal Aent and Deputy Fiscal Agent shall each execute 4P 'ate bond with surety satisfactory to the Board. be 11, a "c. 3. Payments of expenses add other disbursements of the Beard shall by r—ke by the Fiscal Agent upon proper vouchers out of moneys advanced to him 1,ep1 isition and warrant out of the s -cecial fund and placed to his official 4rtilt i with the Treasurer of the United States as provided by Section 5 of this bill , e'Les In the absence of the Fiscal Agent payment of expenses and other di s— rno:nents shall be made by the Deputy Fiscal Agent upon proper vouchers out of f lriclt/8 ad7anced to the Fiscal Agent by requisition and warrant out of the special aaarl4 Placed to his official credit with the Treasurer of the United States 4.—uvided by Sections 5 and 6 of this article. 4s Sec. 4. The Fiscal Agent shall prepare a quarterly account in such form 02p14 44-L1 be approved by the Comptoller General of the United States and, after 4ellerir:`,11 by the Governor, such marterly account shall be submitted to the °t ra4. Accounting Office. Such account shall cover payments of expenses and disbursements made by both the Fiscal Agent and the Deputy FiS cal Agent. 4easii See. 5. The Governor shall, when necessary, make requisition on the Aeellt"l'er of the United States for the advance of such sums to the Fiscal as may be necessary from the Federal Reserve Board fund. 173 2/18/26 -7- Sec. 6. The Deity Fiscal. Agent in making d.isbursemaats of the Board iton : proper vouchers out of the moneys advanced to the Fiscal Agent shall sign 4 0 ' , 641flst funds to the official credit of the Fiscal Agent with the Treasurer t'le United States in the flare of the Fiscal Agent by himself as Deputy Fiscal Aeellts Article Gold Settlement Fund and Federal Reserve Agents' Fund All funds deposited by or for account of the respective Federal Reserve 1Tets in the Federal Reserve Agents' fund of the Federal Reserve Board and all (lePosited by or for account of the resipective 2ederal _ieserve Banks in the (1°1dtt Qe lement Fund. of the Federal Reserve Board shall be ield on deposit 41, e Treasurer of the United States end shall be subject to withdrawal only svec;aeek of the Federal Reserve Board. signed by the Secretary or an Assistant etarY and countersied by the Governor or acting executive officer of the Boarci Article X. Requisition for Delivery of Federal _-;.eserve 'Totes o‘t Requisitions upon the Comptroller of the Currency for the delivery .'ederal r.ake Reserve notes to the mspective Federal Reserve Agents shall be by thbY the Secretary or Assistant Secretary in response only to requests made * ederal Reserve Agents to the Board for such notes. The Secretary or Aas."e F ezecistant Secretary shall submit daily for approval to the Governor or acting tioilutive officer of the Board a schedule showing the amount of each denominal'facie 02 Pederal Leserve1:otes requisitioned by him for the account of each ral Reserve Agent. • Article XI. The Seal. The following is an impression of the seal adooted. by the Board. SEAL. 174 2/18/26 Article XII. Cauns el. * Sec. 1. The Board shall appoint a General Counsel whose duty it shall to advise with the Board, or any member the roof, as to such legal questions as malY arise in the conduct of its business; to prepare, at the Board's request opinions, regulations, rulings, forms and other legal papers and to rf0 rill generally such legal services as he may be called upon by the Board 0 Derform, be , I 3ec. 2. Subject to the direction of the Governor, the General Counsel have authority to corresPond directly with the Counsel of the various 2cleral aeserve Banks and to request their opinions as to the. interpretation the local laws of the States included in their respective Federal 1,;eserve 1-01stricts. Copies of all such correspondence shall be furnished to the arcl for its information. Sec. 3. '..henever it may be deemed advisable, the Board may appoint or more Associate or Assistant Counsel, or one or more Assistants to Me duty of such Associate or Assistant, Counsel shall be to assist SOle 0fe General Counsel in the performance of his duties and to perform the duty or the General Counsel in his absence. The tat/ of such Assistant to Counsel .:'•ssistants to Counsel shall be to assist the General Counsel in the nor0± his duties. Sec. 4. The Board may appoint from time to time Consult inr? Counsel, rnaY be attorneys at law engaged in outside practice. Article XIII. ::eet ins. SeC• 1. Five members of the Board shall constitute a quorum for the action of business. the ,„, Sec. 2. Stated raeetirus of the Board shall be held on such days of to ,_"eelt and at such hours as the Boar1 by a majority vote may fix from time ' irne• One meeting day each week shall be set apart for consideration of tile to fo llowin,(3 matters, advance notice of not less than two days being sent raerabers of important questions to be taken up at the meeting: tra Special Orders; Discount and open market matters; Approval of ernenditures and salaries; Establishment of Federal .i.eserve Branches, Agencies, Currency stations; Permission for establish:Lent of member bank branches; Amendment of Board's rules and regulations; Irew Policies or changes of policy; Such other major matters as may be reserved for cons ideration at the weekly meet 175 2/18/26 -9- Sec. 3. Special meetings of the Board may be called by the Chairman (xovernor or upon the written request of three members of the Board. Sec. 4. At all meetinas of the Board the following shall be the order Of business: (1) Reading or inspection of the Minutes of the last regalar meeting and ::inutes of meetings of the Executive Committee. (2) Report of the Governor. (3) Report of the Secretary. (4) Reports of the committees or members on assigied business. (5) Unfinished business. (6) New business. Article XIV. Absences. See. 1. Absences of appointive members of the Board shall as far as -131'acticablo be arranged so as not to interfere with the expeditious conduct ef tlie Board's business in Washington. ' Article XV. Information and Publ cat ion. tu, Sec. 1. All persons employed by the Board shall keep inviolate its to''111°ss, affairs, and concerns, and shall not disclose or divulge the same .1V "unauthorized person whomsoever, and any employee who shall give inforraata contrary to this by-law shall be liable to immediate dismissal. vote of the Board no one other than a Member of the .Board, or _Assistant Secretaries, Assistant to the Governor, and General shall be permitted to inspect any of the Board's minutes. ,Sec. 2. No statements shall be made to the -oress ex-oressive of the SOar S. ?olicy or descriptive of its action except as authorized and. approved 'Vlie Board. Such statements shall be issued only in written form and when au llerized and approved they shall be issued throujl. the office of the ' Goir cie2riler or such other officer or manber of the Board as may be specifically 1PSrlated. ',;hile each member of the Board must determine for himself the ' kirotr; craest.,ety or necessity of ex-pressing publicly his individual opinion on any • mat,len, members shall not quote publicly the opinion of other members on L'ers Which have not formally been passed upon by the Board. 3ee• 3. There shall be published monthly, a bulletin to be :mown as PederalReserve Bulletin'', which shall be the official periodical organ 'publication of the Federal Reserve Board. No resolutions of a personal character, except upon the death Of er4of the Federal Reserve Board while serving as such, shall arrear j.4 all.Y Publication of the Federal Reserve Board. 176 R V18/25 -10- Article XVI. Anendments. These by-laws may be amended at any regular meeting of the Board by Majority vote of the entire Board, provided that a copy of such amendnte shall have been delivered to each member at least seven days prior 40 suc:h meeting. Report of Committee on Research and Statistics on memorandum dated ?ebIllary 12th from the Assistant Director of the Division of Research and Sta . tistics, requesting authority to discontinue the compilation and publi" 'tic% Of the Board's wholesale price indexes for the United States and 411 JaPan and of the Board's regrouping of the wholesale price index of the Bureau of Labor Statistics; the Committee recormrending approval. Approved. ORTS OF STAND NG COMMITTEES: Dated, February 17th, Recommending changes in stock at Federal Reserve 18th, Banks as set forth in the Auxiliary Minute Book of this date. Approved.. The meeting adjourned at 4:00 lock. Secrete, Vice-Governor.