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115 A meeting of the Federal Reserve Board was held in the office of the Federal Reserve Board on Wednesday, February 4, 1925 at 11:30 a.m. PRESENT: Governor Crissinger Mr. Platt Mr. Hamlin Yr. Miller Mr. James Mr. Cunningham Mr. Eddy, Secretary The minutes of the meeting of the Federal Reserve Board held on were read and approved. February 3rd At this point, Mr. McIntosh entered the meeting. matter Mr. Hamlin on behalf of the Law Committee then reported on the l referred to the Committee at the meeting yesterday, namely, the proposa submitted by Messrs. Cooper and Lobdell of the Federal Farm Loan Board to arnehd Section 13 (a) of the Federal Reserve Act so as to make debentures Of Federal Intermediate Credit Banks eligible for rediscount by Federal aeserve banks and as collateral for loans to member banks. Mr. Hamlin submitted a memorandum from Counsel recommending that the Board adopt the following resolution: "Be it resolved that the Federal Reserve Board offers no objection to an amendmert to the Federal Reserve Act which would permit debentures or other such obligations maturing within six months issued by Federal Intermediate Credit Banks to be used as collateral security to 15 day notes of member banks by Federal reserve banks; but the Board is opposed to any amendment to existing law which would make such debentures or other obligations, or notes of individuals secured by such debentures or other obligations, eligible for rediscount by Federal reserve banks." Mr. Hamlin moved adoption of the above resolution. Mr. Hamlin's motion being put by the chair was carried, the members voting as follows: 2/1/25 Mr. Platt, "aiye" Mr. Hamlin, "aye" Mr. James, "aye" Mr. Cunningham, "aye" Mr. McIntosh, "aye" Governor Crissinger, "no" Mr. Miller, "no" The Governor then presented a letter addressed to him under date of Pebruary 3rd by the Acting Secretary to the President, transmitting a copy Of the report of the President's Agricultural Conference, and inviting the attention of the Board particularly to that portion of the report relating to the Board and banking policy. • The Secretary read to the Board the portion of the report referred to in the letter of the Secretary. . Hamlin, on behalf of the special committee appointed at the Board Meeting on January 8th to consider the recommendation of the recent Governors' Conference on the subject of Federal Reserve bank holidays, reported on a Memorandum addressed to the Board under date of January 22nd by a special committee appointed by the Governors' Conference recommending that the Board reconsider its ruling on the subject of Federal Reserve bank holidays and rule instead that each Federal Reserve bank should advise the Federal Aeserve Board at least ten days in advance of a prospective holiday affecting either the Parent bank or any of its branches, whether the parent bank or such branches Utder advice of the bank's Counsel, would close or remain open on such holiday, it being understood that if the bank should close it would not participate either way in the Gold Settlement Fund clearing, but that if it should remain °Pen it would participate both ways. 2/4/25 Mr. Hamlin moved that the Board reconsider its previous action on the subject of the observation of the holidays by Federal Reserve banks. Carried. Mr. Hamlin then moved that the Board approve the recommendation of the Governors' Conference and rule that each Federal Reserve bank should advise the Federal Reserve Board at least ten days in advance of a prospective holiday affecting either the parent bank or any of its branches, vhethJr the parent bank or such branches under advice of the bank's Counsel, would close or remain open on such holiday, it being understood that if the bank should close it would not participate either way in the Gold Settlement Fund clearing, but that if it should remain open it would participate both ways. Carried. The Vice Governor then submitted copy of letter addressed by him yesterday to the :resident of the Federal Advisory Council, suggesting the following topics for discussion at the next meeting of the Council: (1) Review of the open market operations of the Federal deserve Banks since December 1st. What effect has the sale of government securities had on the central money markets? (2) Gold Exports. How long are they likely to continue? Has the tide definitely turned? Does the export of gold suggest any change in the gold policy of the Federal aeserve System? (3) Probable resumption of a free gola market in England. Is there solid ground under the present rate of sterling exchange? Can the pound sterling be maintained at par? (4) Does the business revival give promise of continuing through most of the year, and if so, does it point to money rates materially higher? (5) ,,re there present indications of inflation? If so, what should be the policy of Federal Reserve banks in meeting it? Noted. 118 -4- 2/4/25 Report of Committee on Salaries, Expenditures and Efficiency, referring to letter dated February 3rd from the Comptroller of the Currency and recommending approval of increases in the salaries of National Bank Examiners, as follows: Frank S. McGarvey - from ,-,Z,000 - 3,300 2,400 - 3,000 - " Henry Sevison 4,000 - 4,200 Arthur B. Smith 4,000 - 4,200 Gerald B. Hadlock 3,600 - 3,900 Gale W. Crossen - it 3,900 - 4,200 A. Burton Faris 3,900 - 4,200 Joel S. McKee Approved. Letter dated February 2nd from the Federal Reserve Agent at Chicago on the subject of the action of the Waren() State Savings Bank of Wapello, Iowa, in absorbing the Citizens State Bank of Wapello without prior consent Of the Federal Reserve Board; the Federal Reserve Agent recommending that the Board permit this matter to lie on the table without action pending (I) A proposed increase of 420,000 in capital of the bank and (2) The re- ceipt of report of another examination to be made after such increase in capi tal has been actually paid in. After discussion, Mr. Platt moved that the Board approve the recommendation of the Federal Reserve Agent but that the Agent be advised that the fact that the Board has not approved the consolidation should not be used in any way in dealing with any application of the bank for rediscounts. Carried. Report of Committee on Salaries, Expenditures and Efficiency dated February 4th on the subject of continued membership by Federal Reserve banks 119 2/4/25 -5- in the American Acceptance Council, dues for which during 1925 will be 300; the Committee reporting that nine of the Federal Reserve banks are in favor of continued membership and three against it, and recommending that the Board reiterate its previous decision that the work of the Council is still of considerable importance and make no objection to the payment Of dues up to 4500 by the Federal Reserve banks; and further, that the sub- ject be referred to the next Conference of Governors for recommendation as to what should be the definite policy of the Board in the matter. Upon motion by Mr. Hamlin, it was voted to approve the recommendations.of the Committee with the understanding that the question of whether or not they will actually continue membership is to be left to individual Federal Reserve banks* Upon motion by Mr. Hamlin, it was also voted that the question of the advisability and propriety of payments by Federal Reserve banks to the American Acceptance Council be referred to the Federal Advisory Council for consideration. Report of Committee on Salaries, Expenditures and Efficiency dated Pebruary 3rd on the subject of membership by Federal Reserve banks in the American Bankers Association; the Committee recommending that the subject be referred to the next Conference of Governors for recommendation and that it be transmitted promptly to the banks in order that the Governors may secure opinions from their Boards of Directors prior to the Conference. Upon motion by Mr. Miller, the recommendationsof the Committee were approved. Upon motion by Mr. Miller, it was also voted that the question of membership by Federal Reserve banks in the American Bankers Association be referred to the Federal Advisory Council for consideration. 106 --,-/‘41 +.1 -6_ 2/4/25 • Mr. Hamlin then referred to the matter held over at the meeting on December 17th, namely, the request of the recent Governors' Conference that the Board express its opinion on the question of principle involved in adopting inter-bank self-insurance plans for both fidelity and life insurance. Mr. Hamlin moved that the Federal eserve Board approve the principle of inter-bank fidelity selfinsurance with the understanding that authority of Congress must first be obtained before it is made operative and further that the question of interbank life self-insurance, which is raised in the Governors' report pa the proposed Federal deserve Pension Fund, be finally passed on when that report is acted on by the Board. Carried. Memorandum dated February 4th from Counsel with regard to the application of Mr. i. K. Thurmond for permission to serve at the same time as director of the American National Bank, Oklahoma City, First National Bank, Sayre.., Okla., and First National Bank, Carter, Okla., Counsel calling attention to the fact that Mr. Thurmond is also a director of the Oklahoma City bralch of the Federal Reserve Bank of Kansas City, but stating that in his opinion the Board may pgrmit him to serve the three national banks and at the same time permit him to continue to serve the branch of the Federal aeserve bank. Upon motion it was voted to approve the application of Mr. Thurmond to serve the American National Bank of Oklahoma City, the First National Bank of Sayre and the First National Bank of Carter,. Memorandum from Counsel dated February 3rd approved by the Law Committee, recommending that the Board reconsider action taken on December 30th -7- 2/4/25 in voting to approve applications of Messrs. Frederick H. Gottlieb and John C. Taliaferro to serve at the same time as directors of the National Bank of Baltimore and the Century Trust Company, both of Baltimore, but to refuse their applications to serve also as directors of the Calvert Bank Of Baltimore; Counsel stating that as a result of a hearing on the subject on February 3rd the Calvert Trust Company is not believed to be in substantial competition With the National Bank of Baltimore. Upon motion it was voted to reconsider action of December 30th and to approve the applications of Messrs. Gottlieb and Taliaferro to serve at the same time as directors of the National Bank of Baltimore, the Century Trust Company and the Calvert Trust Company, all of Baltimore, Md. Memorandum from Counsel, submitting draft of letter to the Under Secretary of the Treasury, transmitting a formal memorandum on the subject Of liability of Federal Reserve banks for paying counterfeit war savings stan p— as fiscal agents of the Treasury, prepared for submission to the .Attorney General in accordance with action taken by the Board on January 19th. Approved. REPOES OF STANDING COMMITTEES: Recommending changes in stock at Federal Reserve bank, as set forth in the Auxiliary Minute Book of this date. Approved. il Dated, February 4th, Recommending approval of the apFlic ion of Er. director of the G. Seip to serve at the same time State 6avings Bank Foreman National Bank, the aose e Calumet National and as President and director Bank, all of Chicago, Ills. Approved. The 'oeting ad* Dated, February 3rd, Secret Approved: Governor
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