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378 Minutes of actions taken by the Board of Governors of the Pederal Reserve System on Monday, February 28, 1949. The Board Illet in the Board Room at 2:00 p.m. PRESENT: Mr. Mr. Mr. Mr. Mr. Mr. McCabe, Chairman Eccles Szymczak Draper Vardaman Clayton Carpenter, Secretary Sherman, Assistant Secretary Morrill, Special Adviser Riefler, Assistant to the Chairman Vest, General Counsel Leonard, Director of the Division of Bank Operations Mr. Nelson, Director of the Division of Personnel Administration Mr. Millard, Director of the Division of Examinations Mr. Mr. Mr. Mr. Mr. Mr. Before this meeting the Presidents of the Federal Reserve e mitted a memorandum covering topics discussed at their el5Etrete meeting on February 25 and 26, 1949, which were to be re111141e4 with the Board at the joint meeting to be held at 3:00 p.m. thte etternoorx. The topics were discussed and it was understood the't Chairman McCabe would state the Board's views substantially Et"'ecorded in the minutes of the separate meeting of the Board lth the Presidents. 14 connection with the discussion of the topic of legislato ,..-"4:ovide for the conversion of national banks to State banks lt}l(AA g°11ag. through liquidation, Mr. Clayton referred to his conti0 4e with Mr. Rapport, Chairman of the Executive Committee ttoli $70..41 7 2/28/119 -2- Of the National Association of Supervisors of State Banks as recorded the minutes of January 14 and 18, 1949. He stated that on Friday 14 atternoon, February 25, Mr. Davis, Chairman of the Presidents' Conasked him to meet with himself and Mr. Sproul, President "the Federal Reserve Bank of New York, at which time Mr. Sproul /atet4d that Elliott V. Bell, Superintendent of Banks for New York, a4/ also a member of the Executive Committee of the National Asso4tion of Supervisors of State Banks, in discussing with him Mr. ele4rt°n I e conversation with Mr. Rapport, said that he understood tliet Mr. Clayton had informed Mr. Rapport that if the Supervisor's 1011 would support legislation proposed by the Board which 488"1 " 11010 A -..v4 extend supplemental reserve requirements to cover all insured bezk. -8) the Board in turn would support the proposed legislation for corxve reiot of national banks to State banks. Mr. Clayton stated ihp ' - °rmed Messrs. Davis and Sproul that there had been a distinct 411114clerstanding since his statement to Mr. Rapport over the tele1114 vas that, unless the Congress made the supplemental reserve 41111tellents applicable to insured nonmember banks, as well as 44114r banks, the Board would oppose the proposed legislation with (1815ect to conveesion. : He added that he informed Messrs. Davis and --14111 that he had never expected the Supervisors' Association to 1111'citt the Board's position with respect to reserve requirement : 'fa"Blation. Mr. Clayton went on to say that Mr. Sproul stated there /les at evident misunderstanding by Mr. Bell of the Board's 2/28/49 -3- Position on the legislation and that he would clear the matter up With him after returning to New York. At this point Messrs. Vest, Leonard, Nelson, and Millard wittor ew and the action stated with respect to each of the matters hereiriafter referred to was taken by the Board: Minutes of actions taken by the Board of Governors of the ?ederea Reserve System on February 25, 1949, were approved unanitIoUsiy. Telegram to Mr. Woolley, Vice President of the Federal Ress1.17' bank of Kansas City, reading as follows: "Reurlet February 24, 1949, regarding employment 01' Arthur H. Saville, Jr., as a trainee for position : 8 an assistant examiner. Board approves his designan as a special assistant examiner for the Federal Aeserve Bank of Kansas City. Please advise nature of disability for which pension is received. With reference to indebtedness, it is assumed these obligations vill be placed on a regular reduction basis if such is llot already the case." Approved unanimously. Letter to the Presidents of all Federal Reserve Banks, read4B follows: ars "Reference is made to the Board's letter S-206 i ted March 4, 1940 (F.R.L.S. #9084.1), in which it tit Provided, in part, that the Board's approval be teined before a Federal Reserve Bank employs special ,:u4sel whose services are likely to involve an ex4'11(liture in excess of $1,000, ae "Pursuant to a suggestion made by a Federal RecrI've Bank the Board has given consideration to in'slag this limitation and, accordingly, the letter " 2AA/49 -4- "s-206 is hereby amended so as to raise from $1,000 to $2,500 the limitation on the amount which may be paid to special counsel by Federal Reserve Banks without the advance approval of the Board of Governors." Approved unanimously. Letter to Mr. Clark, Manager, Consumer Instalment Credit nePa-rtMent, Federal Reserve Bank of St. Louis, reading as follows: "This refers to your letter of February 10, 1949, concerning whether section 6(a)(1) of Regulation W reto the first half of the maximum maturity perMitted by the regulation, or the first half of the actual maturity, where the parties to a particular instalment obligation agree to a maturity less than the maximum permitted by the regulation. "Section 6(a)(1) refers to the maximum maturity Permitted by the regulation. Consequently, in the case of an $800 instalment loan for 8 months, for e aMPle, the 'first half of the applicable 1318XiMUM Maturity' would be 7-1/2 months, rather than 4 months." Approved unanimously. Telegram to Mr. Earhart, President of the Federal Reserve 41,1 Of San Francisco, reading as follows: a "Referring February 23 letter, no objection to ) 31 ,, /E 41‘ding contract for structural steel, Portland 1ding, to Gunderson Bros. Engineering Corp., the f'%/etst bidder, at $159,675. It is understood that : attract may be cancelled with reimbursement for 41°ense of preparing shop drawings." Approved unanimously. klAroveti: Secretary. 14-4-( C? a614Chairman.
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