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89 A meeting of the Board of Governors of the Federal Reserve SYalml was held in Vashington on Tuesday, January 20, 1942, at 10:30 PRESENT: Mr. Mr. Mr. Mr. Ransom, Vice Chairman Szymczak McKee Draper Mr. Mr. Mr. Mr. Morrill, Secretary Bethea, Assistant Secretary Carpenter, Assistant Secretary Clayton, Assistant to the Chairman The action stated with respect to each of the matters hereinafter referred to was taken by the Board: The minutes of the meeting of the Board of Governors of the Pede"al Reserve System held on January 19, 1942, were approved unaniraOu sl of Letter to Mr. Young, President of the Federal Reserve Bank BOston, reading as follows: "Referring to your letter of January 7, 1942, it noted that at a meeting of the Board of Directors of theFederal Reserve Bank of Boston, held on that date, all a ; I_ icers of your Bank, with the exception of the President .4u First Vice President, were reappointed to serve durIng the year 1942. th "Regarding the reappointment of Associate Counsel e Board of Governors approves the payment of a retainer ' ilee to mr. Phillips Ketchum at the rate of ''',2,400 per an1,111, 1.flil for the period January 1, 1942, to April 30, 1942, oiich is to the same date as that for which the payment c officers' salaries has been approved. This is in act() ,,, : I dancs with the procedure set forth in the Board's letalI '312, and it is assumed that when approval is reued for the payment of officers' salaries for the Year , 1 '-eginning May 1, 1942, a request will be included 1'8 90 1/20/42 -2- "for the payment of a retainer fee for counsel for the same period. "The Board of Governors also approves the reappointment of Messrs. Winthrop L. Carter, Carl P. Dennett, Paul A. Draper, and Edward M. Graham as members of the Indus?iial Advisory Committee for the First Federal Reserve District, to serve for terms of one year each, beginning on March 1, 1942. , "In view of the recent appointment of Mr. Albert M. 'reighton as a Class C Director of your Bank, it is assumed that he will resign as a member of the Industrial Advisory Committee. "It is noted that Mr. Charles E. Spencer, Jr., President of The First National Bank of Boston, was reappointed a member of the Federal Advisory Council to represent the First Federal Reserve District during the year 1942." Approved unanimously. Letter to Mr. Evans, Vice President of the Federal Reserve Bank of Dallas, reading as follows: m . "Reference is made to the application of 'The First , 1l'aticnal Bank of El Campo', El Campo, Texas, for authority act as trustee and executor, which was transmitted to Ire Board with your letter of January 3, 1942, and to the ee?mmendation of your executive conunittee that the application be granted. "It is noted that the bank inadvertently accepted an TPointment as co-trustee without having authority to act i7 any fiduciary capacity, and that the primary purpose of aPPlication is to correct this situation. It appears arl ! It is intended, for the present at least, that the oranistration of the trust is to be largely in the hands a ,One of the individual co-trustees and that, during the n.,-Proximately four months period between the date of api:lntment and the date of the latest examination by a nartc)nal bank examiner, the bank had not assumed fully its , 13 313°Ilsibilities under the trust instrument as dictated ; p ?und corporate fiduciary practice. This seems especially polent as the trusteeship in question appears to have in-1°1e complications in administration which could easily v°lve the bank in more than ordinarily serious problems. I 91 1/20/42 -3- "Aside from the one trusteeship in question, it does not appear that the bank has any trust business immediately available to it, or that there is any important demand locally for a corporate fiduciary. Neither does it appear that the official personnel of the bank has any training or experience in fiduciary business other than that gained by occasionally acting individually in a trust c apacity, or by advising their customers in such matters, laond it seems unlikely that, if granted trust powers, the ank would ever acquire sufficient trust business to warrant it in maintaining adequate records and trained perWhich are so essential to avoid or minimize the risks inherent in the administration of trusts. "The good condition and management of the applicant bank have been duly considered, but in view of the situation outlined in the preceding paragraphs, which is based ?la the information submitted by you, and that contained the report of examination of November 25, 1941, the Board is unwilling to grant the permission requested. tnlees you have some additional facts having an important Dearing Upon this case, please advise the applicant bank aCCO rdirigly. Approved unanimously. Memorandum dated January 12, 1942, from Mr. Carpenter, Assist'alit Secretary, submitting drafts of entries covering policy actions t ke) ,, a" °Y the Board during the year 1941, for inclusion in the record Maintained by the Board in accordance with the provisions of the last P41‘461‘e'Ph of section 10 of the Federal Reserve Act. The drafts of entries were approved unanimously. Thereupon the meeting adjourned. Secret Approved: Vice Chairman.
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