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_ 171 A sYst meeting of the Board of Governors of the Federal Reserve waS held in Washington on Wednesday, January 31, 1940, at PRESENT: Mr. Eccles, Chairman Mr. Mr. Mr. Mr. Ransom, Vice Chairman Szymczak Davis 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 hereinPeter _red to was taken by the Board: Pederta The minutes of the meeting of the Board of Governors of the Re8erve System held on Xanuary 30, 1940, were approved unani- Letter to Mr. Dillard, Secretary of the Federal Reserve Bank or ohice ()) Pending es follows: zola : Re ferring to your letter of January 26, 1940, the Governors approves the appointment of Messrs. 1411. zpstein) R. R. Monroe, G. Barret Moxley, Walter Iiicl ischfa,P7er, and Martin H. Kennelly as members of the Iies-stl'ial Advisory Committee for the Seventh Federal rve District to serve for terms of one year each beMarch 1, 1940." Approved unanimously. Letter to the board of directors of the "First State Bank", 1,1„0 -111e, yr ttkm ez ext, stating that, subject to conditions of membership ed1 t ° 3 contained in the Board's Regulation H and the following 1_72 1/31/40 sPecial conditi on, the Board anproves the bank's application for memhlis11113 in the Feder al Reserve System and for the appropriate amount ofstock in the Federal Reserve Bank of Dallas: It4 . Such bank qhall make adequate provision for deP"reciation in its banking house and furniture and f ixtures." Approved unanimously, together with letter to Mr. Gilbert, President of the Federal Reserve Bank of Dallas, reading as follows: 8 "The Board of Gover nors of the Federal Reserve Sysa roves the application of the 'First State Bank', Texas, for membership in the Federal Reserve 5YStciien elf:,,, subject to the conditions prescribed in the en14.:2'ed letter which you are requested to forward to the Directors of the institution. Two copies of F1'd1 re also enclosed, one of which is for your 1,r tand the we : other of which you are requested to for to the Commi ssioner of Banking for the State of 8 tor his information. is assumed that your office will follow the matt excac, the bank's reducing to within statutory limits the Qsi've balanc e with a nonmember bank." Lett„ to "The City National Bank of Colo ado", Colorado City, Texas, r :It " lc:ling as follows: 26, 17,his refers to the resolutions adopted on September and January 9, 1940, by the board of directors Y°11r b a r its -i--, signifying the bank's desire to surrender to i, fl-t to exercise fiduciary powers heretofore granted v. aottl:The Board, understanding that your bank has never h" accepted or undertaken the exercise of any trust, theti led a formal certi ficate to your bank certifying riclu,t is no longer authorized to exercise any of the 11(ir RrY Powers Covered by the provisions of section °t the Federal Reserve Act, as amended. This cereate is enclosed herewith. . 173 r "In this connection, your attention is celled to the FT that, under the provisions of section 11(k) of the ,'el*el Reserve Act, as amended, when such a certificate r i been issued by the Board of Governors of the Federal l eserve System to a national bank, such bank (1) shall no ger be subject to the provisions of section 11(k) of the Reserve Act or the regulations of the Board L'overnors of the Federal Reserve System made pursuant ' suers-to, (2) shall be entitled to have returned to it any 81711.rities which it may have deposited with the State or t ilar authorities for the Protection of private or court f;L4ste, and (3) shall not exercise any of the powers conWithbY section 11(k) of the Federal Reserve Act except e the Permission of the Board of Governors of the 1'81FedReserve System." Zr Approved unanimously. Letter to Mr. E. W. Pollock, Cashier, The First National Bank Tr st en -mPonY, Tulsa, Oklahoma, reading as follows: always welcome suggestions from the member banks Federal Reserve System and appreciate your letter of : 111-ler3T 18, 1940, in which you suggest the possibility let :uhif'orm size of paper for the regulations and general h-ehks. of the Board of Governors and the Federal Reserve Of t "We of she tel,e "As You know, the regulations of the Board of Gayerels are now Published on paper of uniform size. It is Policy of the Board, with few exceptions, whenever -Alla liowtion is amended, to reprint the entire regulation. thee r, the size of the Board's regulations differs from the; -1-2e of some of the circulars and Renerel letters of tizeaederal Reserve Bank of Kansas City, and it is recogat a uniform size for all of these documents would be mi1,nat 114 --" banks and others them. convenient for the member to ha"We are caad to advise you that steps are being taken 841tat, th -e feasibility of your suggestion studied in conis 110 , -1011 with the various Federal Reserve banks, and it tO 1),!'ed that after investigation some way may be found about a more convenient arrangenent." 174 1/31/40 -4Approved unanimously, together with a letter to Mr. Harrison, Chairman of the President s' Conference, reading as follows: "There is enclosed herewith a copy of a letter reby the Board of er Governors from the Cashier of The list National Bank and Trust Company of Tulsa, Oklahoma, testin,- the Possibility of a uniform size of paper for Bee regulations, circulars, and general letters of the i,erd of Governors and the Federal eserve banks. There eleo enclosed a copy of the Board's reply. ce "Peeline. that the subject is one which is worthy of ,,,r consideration, the Board would like to obtain the ' al v ac ei\11eiws of the Presidents' Conference as to the desirability l'easibility of the proposal and suggests that it be 'vet co nsideration by the Conference. be i "in order that the other Federal Reserve banks may co,infoTried With respect to this matter, we are sending es of this letter and of its enclosures to them." Memorandum dated January 22, 1940 from Mr. Van Fossen, Assis9 chief of the Division of Bank Operations, recommending that Form 1 (Short " th_ form), report of condition of member banks, be amended taemortiti: indicated on the copy thereof attached to the memorandum. rn al:tated that the proposed changes were not of substance btlt were desi to insure the correct reporting of items called for Schedtlie D, tie Miscellaneous, and that it was understood from the of- or the Co mptroller of the Currency that similar changes will be 1114 ill the ,,Short fain" of call report to be used by national banks 1)111r114 with the to spring call. Approved unanimously. Menior, ' Ilcitr'n dated January 29, 1940, from Mr. Goldenweiser, 114 he ,vision of Research and Statistics, stating that 175 1131/40 -5la accordance with the 13rovisions of the Board's letter of January 19, 1940 (s --200), the Federal Reserve Bank of Kansas City had requested Pelltission to discontinue the report form used for collecting data on 4tvi11fs ' s deAosits and accounts from selected banks in the Tenth Federal 48"17e Di strict, and recommending that, for the reason stated in the Illetil°1%"(Itiral the request of the Kansas City bank be approved. Approved unanimously. Letter ervi, tank of to Mr. Paddock, First Vice President of the lederal Re- Boston, reading as follows: 20 "There is enclosed a copy of a letter dated January Nat 'il9401 from Mr. Cyrus Monroe, President of The Whitman belmc3 i liel Bank, Whitman, Massachusetts, reauesting special li - etT ssion for Mr. Edwin W. Hunt, President of the Home c0ll. nel Bank of Brockton, Brockton, Massachusetts to -1.1nUe under section 8 of the Clay-ton Act to serve as ' ,/%ector of The Whitman National Bank. 8etr, "Please ascertain such information as may be neces131,0, 1 ,i and advise Mr. Monroe as to the applicability of the t,,, si°1as of the Clayton Act and the Board's Regulation thi8 litint'S services with these institutions. In thEct- ecninection, your attention is directed to the fact Eathourth Mr. Monroe indicates that 'the town of ca,,, -"1113- and the city of Brockton are contiguous' in which it Of course, the relationship would be prohibited, town s Possible that Mr. Monroe may be referring to 'the El viluOf *Whitman' in the sense of a township rather than citT,.ae‘e 1-tall city, since it appears that there is Of af. ' Y Of that name in Massachusetts with a population O iPPr°Ximately 7600 which is situated within the town 1-12: 4ic 411 .shiP of Whitman. A map of the State of Massachusetts ar.e „1"'as that this city of Whitman and the city of Brockton teltisPut ovratfive miles apart. As, of course, you know, the coitTru. . t Ets used in exception numbered 5 refers to a ekiba li viltY such as a village or small city and not to a ' 81 "of a county known in various states by the 176 1/31/40 -6"term to or township." Approved unanimously. Letter to Mr. Gidney, Vice President of the Federal Reserve tatiz Of New York, reading as follows: ?eference is made to your letter of January 9, 19 " 1;e1 relative to the Clayton Act status of Mr. Adolph -11,,4d who is seryinc, as a director of Bias Immigrant Bank a director and officer of The Amalgamated Bank 'ew York, and of Mr. Abraham Herman rho is serving es director and officer of Hies Immigrant Bank and or e director of The Pennsylvania Exchange Bank, all „illaw York, New York; and presenting for the consideror the Board the question whether exception numbailed to.. 1 i (6) of section 8 of the Clayton Act is applicable '"e services of Messrs. Held and Herman with these -(Aitutione. org4 "It is understood that Bias Immigrant Bank was gsil-rized in 1922 under the New York Banking Law, with Tieb-ral banking powers, under the sponsorship of the perraw S heltering and Immigrant Aid Society; that 95 1111;ent of its stock is owned by the latter Society whi l 18 a social service organization, the budget of ' 13111,;, is met by voluntary contributions; and that the Tini: : .()se of the bank is to enable people living in the their States to bring acertain amount of relief to It .r relatives abroad throuRh the medium of the Society. ie 18 un derstood also that, although Bias Immigrant Bank 104,Z1Ithorized under its charter to do a general banking 4. 1111"s, it does not accept deposits and accordingly tio.jt a member of the Federal Deposit Insurance Corporaacte' d ',het it does not make loans, that the business transOn a non-profit basis, end that it is enexclusively in the transfer of abroad as an atla iet to the services performed by the Hebrew Sheltering TrIrtlirant Aid Society. it th respect to the transmission of funds abroad, Illitai nderstood that it is the usual practice of Hies clily';'n Bank, where possible, to transmit funds abroad the t'u united States money; that it does not assist in 1isvpr5fl s510n of such funds if it has reason to be- IUDt the transmission is for a commercial or 177 1/31/40 pu.rpose rather than for the purpose of personal "calatance; that since September 1, 1939, the bank has not been transmittinr: United States money to Europe be: 11 e it was understood to be Dractical1y impossible to t-e b United States currency into the hands of possible reciPients there; that, except with respect to the transof funds to recipients in Germany, the usual pro' ecei llre of the bank has been about as follows: upon rel.—Pt cl-f a Particular sum of money in New York the bank tiec'llests 8 charitable organization located in the parcueular foreign country to pay that sum in United States izrlsencY to the designated recipient; the foreign organeuation then reeuests 8 bank in that country to pay such 1,erl ' elleY to the recipient or to furnish it with the curth, -11eY t° Pay the recipient; the foreign bank instructs to °rganization to have the necessary amount credited co.t,the account of the foreign bank with its New York esP°ndent, end the organization advises Bias Imc;--Lant Eank • accordingly, after receipt of advice of pe : , c11.,, t from its New York- correspondent the foreign bank 01 : ' 1 united States currency as requested by the charitable mi"-tlization; Hies Loitigrant Bank may pay a slight pre: 1111. to the New York correspondent of the foreign bank the tr, 1118Y be allowed a slight discount, depending upon atd' ic 'st of United States dollars in the particular country; l ect ' ll PaYment for its services Bias Immigrant Bank col"Itee r charge from the transmitter. Trittnio is understood that, at the present time, Hies arid i.`", rballt Dank is transmitting funds only to Germany; • uat with respect to the transmission of funds to "; etPients in Germany, because of the impossibility of renell .: itig for the actual delivery of United States curtthe Trielit`',., Person s; in that country, due to German govern810117 res trictions'', resort has been had to the trans-nisRezie of 'b enevolent marks', the use of which has been coniml'ellY restricted to , .hat might be described as nonPurposes, in such cases, the practice of Bias Yol.k'' ant Bank is to Day United States money to the New that c(Irrespondent of a German institution and request Thitt ,he t amount of 'benevolent marks' into which the 4,t '4 St. es money is convertible, be paid to the desigib: ' appears also that the amount of ,:teir°1 dkileilt marks' which may be paid to any recipient • tili c,P„" raY One month has been limited by rovernmentel uo a relatively small amount; and that, although (3111Y transfers now being effected by Hies Immigrant -eeipient. it 1_78 1/31/40 -8are the bank minor ones to persons residinp: in GermanY I hopes to be able at some future date to resume its trensm . ission services for the benefit of needy per°Yie in other airopean countries. p, "Although The _Amalgamated Bank of New York and The elinsYlvania Exchange Bank, both of which are members c4)r th Federal Reserve System., engage in a general bank14- business and, as a service to their customers, trans111°11eY abroad, it is understood that their practice t. , 3- 'his regard follows more closely that generally foled bY commercial banks and is, accordinaly, somewhat ferent from that followed by Hies Immigrant Bank. It s Understood that, upon request of a customer, The Amal,ed Bank of New York issues its own draft payable in EITEtt ei3 7- elgn money drawn on a foreign correspondent, or purNeesee a draft for the customer from one of the larger row ,Y 4 eirk banks payable in foreign money drawn on its 13..'°Ign correspondent; that The Pennsylvania Exchange 0;11k likewise purchases a draft for a customer from one the larger New York banks payable in foreign money beo-11 „.. on its foreimi correspondent; that both member ' tri us nurchase on behalf of customers drafts payable nited States money drawn by other banking institutio, th„ -s in New York on their foreign correspondents; and org;The Pennsylvania Exchange Bank issues, on behalf States can Express Company, drafts payable in United 1T1°neY dram on that Company's foreign correspondforei wh.ereas Hias Immigrant Bank does not deal in tonie,P) exchange, does not issue or purchase for its cusree,'s drafts payable in foreign money, end except with Gerra v eet to the transmission of 'benevolent marks' to ratde811 ,Y as indicated above, arranges for payment to be " 0) Persons abroad only in United States money. i On the basis of the facts recited above, and bear11 illind the purpose of the Clayton Act, the circumstnn., the 'ea under which Hias Iminigrant Bank was organized, doe 'PLI , I*P°ses for which it is operated, the fact that it it i,-c/t receive deposits nor make loans, the fact that the a non-profi organiz t ation, and the fact that in i ensfer of fUnds to foreign countries it employs rfleth: different from those employed by The Imalr_amated it 4 °I New York and The Pennsylvania Dcchange Bank, rat48 the opinion of the Board that so long as Tiles Im411t 'Bank does not engage in any other banking activity t Z L .179 1/31/40 -9of Messrs. Held and Herman with Hias maZile services Bank and with The Amalgamated Bank of New York The Pennsylvania Exchange Bank, respectively, are °-40.Ject to exception numbered (6) of section 8 of the ie" l .—on 4 Act. You will understand, of course, that if the Aiture the facts should change a different conOn might be reached." Approved unanimously. Thereupon the meeting adjourned. V:cezt, A.4 Chairman. Secretary.
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