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, A meeting of the Federal -deserve Loard was held in the o2fice of the Federal :Jeserve Board on : - :ednsday, February 20, 1924, at 3;10 p.m. loveror Crissiner • :latt • :1111er Pr. amos • f.ddy, Secretary ?he minutes of the metin.L3 of the Federal 17.eserve Thard held on Febru, ary 19th were read and approved. Letter dated Febrixry 16th from the Federal laeserve 1,2;ent at I.Iinna-oolis reuestins approval of the emrloyment of :.;riadier eneral H. P. Howard, to look after the supervision and protection of the new building of the bank, the date of his emoloyment to be determined later and his salary not to exceed .:e0,000 per annum. Referred to Corraittee on Salaries and ..xpenditures. Report of Committee on Discount and Open LSarket Policy on matter referred to it at the meeting on FebruLry 19th, namely, letter dated FebruarY 18th from the Gever_or of the Federal Reserve Bank of New York with l'°311rd to the execution by the Open lIrket Investment Committee of special Orders received from Federal Reserve banks, rarticularly the Federal Reserve ank Of Dallas; the Committee reporting that the manner in which special orders for open market purchases from the Federal 'deserve Bunk of Dallas have been handled by the qovenlors' Committee is satisfactory and that Governor Strong be advised that the Board sees no occasion for a departure 2/20/24 from the understanding reached at the recent conference of the Open ilarket Policy Committee of the Federal Reserve banks with the Federal Reserve Board. Approved. Report of Committee on Examinations on matter referred to it at the meeting on February 19th, namely, letter dated February 11th from the Federal Reserve Agent at San Francisco, advising of the receipt of an application for Federal Reserve bank stock from the Bank Of America, Los Angeles, said application being made with a distinct understanding that the bank will be permitted, upon the am-royal of the State Superintendent of Banks, to establish a reasonable number of branches within the corporate limits of the City of Los Angeles and contiguous territory; the Committee recommending that the regular Policy of requiring state banks applying for membership in the System to agree to regulations relative to branches, as well as other conditions, be strictly adhered to in this case, and that the Federal Reserve Bank of Jan 2rancisco be instructed to advise the Bank of America that the present definition of "contiguous territory" automatically expires Oil ally 31st and thato in the absence of Congressional action or court decisiei changing the situation, after August 1st branches will not be permitted outside of the limits of the city of the home offic6 and A territory contiguous thereto, as defined in the Board's resolutions of November 7, 19-3. Approved. 2/20/24 Letter dated Febrmry 14th, fr= the Secretary of the California League of Independent Bankers, transmLting copy of resolution adorted by the 11xecutivo .. Counsel of the League, rrotesting against the interpretation of the term "territory contiguous thereto" in any manner other than that stated in theBoard's resolutions of Yovembor 7, 1923, Mr. Miler moved that any reply to the above lettor, other than an acknowledgment, be deferred until the Board has acted on the several motions regarding branch banking that are now before it. Carried. Rerort of Committee on Lxaminations on letter dated February 13th from the Federal Reserve Agent at San Francisco, transmitting and recomMending approval of the application of the Security Li-rust and Savings Bank of Los Angeles to acquire the National Bank of Huntington Park, lilIntinton Park, California, and to establish a branch in its premises; the Committee stating that it sees no reason why the applination should not be granted, as it seems to be in proper form, with the approval of the state Banking authorities and the Federal Reserve bank, and the location within territory contiguous to Los Angeles. Approved, Report of Committee on tlxaminations on matter referred to it at the meeting on February 19th, namely, memorandum dated February 15th fl'oM the .L;omptroller of the Currency, recommending approval of the application Of the Citizens National Bank of Valliant, Okla., for permission -4- 2/20/24 to reduce its capital stock from v35,000 to ,,30,000, the stockholders voluntarily to pay in %;8,7L50 and the entire amount of reduction to be used to take out losses; the Committee recommending approval of the application upon the voluntary payment of ,8,750 by the stockholders. • Approved. Report of Committee on Examinations on matter referred to it at the meeting on February 19th, namely, letter dated February 16th from the Federal Reserve ,_gent at Minneapolis, reluesting permission to dispense 7.1th examinations of Michigan state member banks and stating that if any of these banks make application for loans, credit investi- gations or examinations can then be made; the Committee recommending that the permission requested be granted. Approved. Report of Committee on _!:xaminations on matter referred to it at the meeting on February 19th, namely, letter dated February 14th from the Federal Reserve A,I;ent at St. Louis transmitting and recommending approval of the application of the Shaw State Bank of St. Louis for a reduction in its reserve req-Arements from 110,; of demand deposits and 3'A Of time depOsits to 7% of demand deposits and 3,J of time deposits under the provisions of Section 19 of the Federal Reserve Act; the Committee recommending approval. -5- 2/20/24 Mr. James moved approval of the Committee's report. Mr. James' motion being rut by the chair, the members voted as follows: Governor Crisinger, "no" Mr. Platt, "no" Mr. Hamlin, "aye" Mr. Miller, "aye" Er. James, "aye" Five affirmative votes being necessary to alprove, Mr. James' motion was lost. Er. Platt then moved that the Federal Reserve Bank of St. Louis be advised that sufficient progress in improving the condition of the bank has not yet been made and that the Board is not ready to approve the reduction. Carried. Letter dated February 18th, from Governor Fancher advising that the Governors' Committee on Voluntary Services will meet in *,;ashington On :,londay, February 25th at 10:00 a.m. Noted. Letter dated February 14th, fram the Federal Reserve Agent at San Francisco, enclosing letter from the Superintendent of Banks of the State Of California advising that eighty-two applications for the establidhment Of branches, similar to those filed with the Federal Reserve Board, have " 13 ,a received by that Department from the Bank of Italy but are not being considered at the present time. Noted. -6- 2/20/24 Letter dated February 16th from the Consultin; Architect of the Beard inquiring as to the proper distribution of the expenditures for buildings to house the Branch Federal Reserve banks at Denver and Omaha. Referred to Committee on Branches. Counsel submitted a memorandum on the matter referred to him at the meeting on February 12th, namely, letter dated February 7th from the Falconer Company of Baltimore, Lid., inuirin7 whether the Board has anY objection to the use on checks manufactured for member banks of a design containing the words "member Federal Reserve System"; Counsel recommending that the Board offer no objection to the design submitted arid submitting draft of a letter to the Falconer Company on the subject. Approved, with the understanding' that this action of the Board shall not be used as an endorsement of the product of the company. Report of Committee on Examinations on matter referred to it at the meeting on February 11th, namely, the euestion of whether the Board should follow some general procedure in the matter of advising interested Parties of the filing of applications for permission to establish branch banks in their localities. After discussion, Llr. Hamlin moved that Federal Reserve Agents be authorized to give out this information, including the nam of the applicant bank, in case in,7airy is made. Carried. Report of Committee on Examinations on matter referred to it and the Law Committee, jointly, at Ale meeting on February 11th, namely, letter -7- 2/20/24 dated February 7th, from the Chairman of the Federal Reserve Bank of Cleveadvisin;7; that of the member ban*Gs in the Fourth District which have branches, five were reluired by the Board to agree to the condition that they would establish no branches withut the permission of the Board and sixteen were not and suggesting that he Board inter2ret, 30 as to include the open- ing of branches, its general condition of admission to membership "that axceyt With the approval of the Federal Reserve Board there shall be no change in the general character of the assets or broadening in the functions now exercised by you, such as will tend to affect materially the standard now maintained and required .as a condition of membership U; Mr. James recommending approval Of this suggestion and Mr. Platt concurring, with the understanding that a bank must ask the permission of the Board in order that it muy be ascertained Whether the new branches will or will not "tend to affect materially the stand110W maintained and mluired". After discussion as to the 1)rorriety of such an interl)retation, the matter was referred to the Law Committee for the preparation of a regulation on the subject. the Committee on Clearings rev)orted on the matter referred to it at the meeting on December 11th, namely, letter dated December 10th from the 2ederal Reserve Arent at Richmond, with respect to the amendment of Regulation Series of 1923; the Committee recom:lending that when Regulation "J" is lly promulgated, alb-section "0" of Ject ion III be retained an to read as follows: amended to 2/20/24 "No Federal Reserve bank shall receive on derosit or for collection any check drawn on any non-member bank which can not be collected at par in acceptable funds." Referred to Law Committee vision of RegulatiJn "J". or preparat ion of a re- Report of Law Committee on letter dated February 5th, from the ant 'Federal Reserve .:'--sent at ssist- an Francisco, with regard to the surrender of Federal Roserve bank stock held by a state member bank which is absorbed by a state non-mmber bank; the Committee submi,,tin;: draft of a reply to the effect that the consolidated non-member bank may apply for permission to surrender the stock of the state member bank absorbed. Approved. iThe Law Committee then reported on the nritter referred to it at the meeting on February 14th, namely, letter dated February 8th from the Federal Reserve Agent at Richmond, replying to the Board's letter of Febl'uary 5th concerning the establishmait of branch by the 11.m. Bern Bankin[7. and Trust Company of New Bern, North Carolina, which was not at the time Of admission to membership required to agree that it would establish no b ranches without the approval of the Board; the Connittee stating the °Pinion that the general condition of membership can properly be int erDreted so as to require a state bank desiring to establish additional branches to refer the matter to tne Board for determination whether the °Penin,rs of a new branch will result in a broadening of functions "such 2/20/24 as will tend to affect materially the standard now maintained and required as a condition of membership". Approved. Ur. Hamlin stated that he had received a personal letter from the Governor of the Federal Reserve Bank of Boston stat in.; that upon advice of his physician he has arranged to go abroad, planning to leave on Uardh 1st and return about April 15th. Upon motion by Jr. Hamlin, it was voted that if the Federal Reserve Bank of Boston re liests this leave of absence for its Governor, the Board will not object to it. Ur. rlatt then submitted a memorandum on the subject of branch banking for insertion in the Annual Report of the Board for the year 1923. After discussion, this matter was held over for consideration at a meeting to be held early next week. aljajligs OF sarpING C0LIMIT2.:;ES: Dated, February 19th, Recommending changes in stock at Federal Reserve banks, as set forth in the Auxiliary Unnte book of this date. Approved. ated, February 20th, Recommending action on applications for fiduciary 20th, powers as set forth in the Auxiliary Llinute book 20th, of this date. Approved. D/ate February 20th, Recommending approval of the arplica n of Jr. Herman 3. Whine to serve at the me as director of the First National Bank of Ja a and as director of :-Zueens Bellaire Bank, both le Borough of -:ueens, City of New ork. Approve The meeting lock. %roved: Secretary. Governor.
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