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Minutes for
To:
Members of the Board
From:
Office of the Secretary
January 31, 1963
Attached is a copy of the minutes of the
of
Board
Governors of the Federal Reserve .System on
the above date.
It is not proposed to include a statement
with respect to any of the entries in this set of
minutes in the record of policy actions required to
be maintained pursuant to section 10 of the Federal
Reserve Act.
Should you have any question with regard to
the minutes, it will be appreciated if you will advise
the Secretary's Office. Otherwise, please initial
below. If you were present at the meeting, your
initials will indicate approval of the minutes. If
you were not present, your initials will indicate
only that you have seen the minutes.
Chin. Martin
Gov. Mills
Gov. Robertson
Gov. Balderston
Gov. Shepardson
Gov. King
Gov. Mitchell
c_P,7„04)
Minutes of the Board of Governors of the Federal Reserve
System on Thursday, January 31, 1963.
The Board met in the Board
Room at 10:00 a.m.
PRESENT:
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Martin, Chairman
Balderston, Vice Chairman 1/
Mills
Robertson
Shepardson
Mitchell
Sherman, Secretary
Kenyon, Assistant Secretary
Solomon, Director, Division of Examinations
Johnson, Director, Division of Personnel
Administration
Mr. Hexter, Assistant General Counsel
Mr. O'Connell, Assistant General Counsel
Mr. Shay, Assistant General Counsel
Mr. Hooff, Assistant General Counsel
Mr. Goodman, Assistant Director, Division of
Examinations
Mr. Leavitt, Assistant Director, Division of
Examinations
Mr. Thompson, Assistant Director, Division
of Examinations
Mrs Semia, Technical Assistant, Office of
the Secretary
Miss Hart, Senior Attorney, Legal Division
Mr. Hunter, Supervisory Review Examiner,
Division of Examinations
Mr. White, Review Examiner, Division of
Examinations
Mr.
Mr.
Mr.
Mr.
Discount rates.
The establishment without change by the
January 30, 1963, of the rates on
Federal Reserve Bank of Atlanta on
existing schedule was approved unanidiscounts and advances in its
appropriate advice would be sent
Mously, with the understanding that
to that Bank.
17
at points indicated in minutes.
Withdrew from meeting and returned
aIRP
1/31/63
-2Circulated or distributed items.
The following items, copies
of which are attached to these minutes under the respective item numbers
indicated, were approved unanimously:
Item No.
Letters to Morgan Guaranty International
Finance Corporation, New York, New York,
granting permission (1) to purchase shares
Of Holding Company for Financing and
Credit Ltd., Basle, Switzerland; (2) to
acquire shares of Australian United
Corporation Limited, Melbourne, Australia,
in exchange for shares of Anglo-Australian
Corporation Pty. Limited; and (3) to
Purchase shares of Euramerica Finanziaria
Internazionale, S.p.A., Rome, Italy.
1-3
Letter to Union Trust Company of Ellsworth,
Ellsworth, Maine, approving an extension of
time to establish a branch on Outer High
Street.
4
Letter to The Central Trust Company, Cincinnati,
Ohio, approving an extension of time to establish
a branch at 3300 Central Parkway.
5
Letter to The Central Bank and Trust Co.,
Denver, Colorado, regarding its request that
a public hearing be held on the application
Of Denver U. S. Bancorporation for permission
to become a bank holding company or, if that
request be denied, that the bank be permitted
to file a written objection to the application.
6
With reference to Items 1-3, Governor Robertson suggested that
it would be helpful if the staff would study, and submit views on, the
effect of investments by Edge and agreement corporations on the United
States balance of payments, particularly in light of the proposed
revision of Regulation K, Corporations Doing Foreign Banking or Other
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1/31/63
Foreign Financing Under the Federal Reserve Act, to which the Board
had been giving consideration recently.
There was general agreement
with Governor Robertson's suggestion.
Governor Balderston was called from the meeting at this point.
Interest on "savings shares" acquired from another institution
Items 7 and 8).
At its meeting yesterday the Board had considered a
draft of letter to the Federal Reserve Bank of Boston regarding a request
by Indian Head National Bank of Nashua, New Hampshire, for a ruling with
respect to the payment of interest on funds represented by "savings
Shares" to be acquired through the purchase of assets and assumption
of liabilities of Claremont Co-operative Bank (a building and loan
association).
The national bank wished to know whether it might
immediately pay interest at the maximum 4 per cent rate on funds that
had been on "deposit" in the other institution for a period of at least
12 months.
The draft letter took the position that Indian Head National
Bank could immediately begin paying the 4 per cent rate on any
e Bank had held for at least
savings funds that Claremont Co-operativ
a year.
the desirability of
Discussion of the matter had indicated
certain suggested changes,
Preparing a new draft of letter reflecting
and a revised draft subsequently had been distributed.
Prior to this
suggested by Governor Mills, and at
meeting, further changes had been
the beginning of today's discussion the portion of the draft containing
those changes was read by Mr. Hooff.
18
'
1/31/63
The ensuing discussion related principally to the last paragraph of the revised draft, which stated that although the provisions
of Regulation Q contemplated that normally the words "any savings deposit
that has remained on deposit" meant a deposit in the same bank, the
Board was of the opinion that where a member bank took over another bank
by merger, consolidation, or purchase of assets, savings accounts in such
in the resultOther bank would be considered as having been on deposit
ing bank.
It was contemplated that the substance of that paragraph, but
not the remainder of the letter to the Federal Reserve Bank of Boston,
as a general interpretation.
would be sent to all of the Reserve Banks
the last paragraph of the
Governor Robertson, observing that
question whether it might not
draft referred only to banks, raised the
to the Reserve Banks, and
be misleading to send only that paragraph
should not be revised to speak of
Whether the paragraph, therefore,
over, since in any similar future
another "institution" being taken
taken
case the Board presumably would take the same position that was
in the draft letter.
Upon consideration of this point, however, the
to keep the general
view was expressed that it might be desirable
side by limiting it to deposits
interpretation on the conservative
it was suggested that use of the
in banks being taken over by other banks;
word "institution" might have the effect of expanding the interpretation
in an embarrassing position
to such extent as possibly to place the Board
on some future occasion. If the interpretation was expressed only in
1/31/63
-5-
terms of banks, the Board could determine cases involving nonbank
Institutions in such manner as it saw fit, just as it was doing in the
Present case, if and when specific questions should arise.
After further discussion, it was agreed unanimously that the
substance of the last paragraph of the draft letter would be sent to
the Federal Reserve Banks as an interpretation, and that it would be
Published in the Federal Reserve Bulletin and in the Federal Register.
A copy of the letter sent to the Federal Reserve Banks is attached as
Item No. 7.
It was also agreed that the terms of the foregoing inter-
to the Federal Reserve Bank
Pretation need not be included in the letter
Of Boston concerning the specific question that had arisen.
Therefore,
'With the last paragraph of the draft deleted, and with certain suggested
Changes in the wording of the remainder of the letter having been agreed
Upon, the letter to the Federal Reserve Bank of Boston was approved
unanimously.
A copy is attached as Item No.
8.
Messrs. O'Connell, Hooff, Goodman, and Thompson then withdrew.
Dauphin Deposit Trust Company merger denial (Item No. 9).
There had been distributed a memorandum dated January 18, 1963, from the
a request
Division of Examinations and the Legal Division regarding
for reconsideration and oral presentation in the matter of the application,
denied by order dated July 13, 1962, of Dauphin Deposit Trust Company,
The First National Bank of Mount
Harrisburg, Pennsylvania, to merge with
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1/31/63
Holly Springs, Mount Holly Springs, Pennsylvania.
The Board's state-
ment indicated that it had denied the application because consummation
of the proposed merger would eliminate the substantial competition
existing between the two banks and because it would result in further
concentrating the banking resources and facilities in Dauphin and
Cumberland Counties.
Further, the Board considered that there was
banking needs of Mount Holly
insufficient evidence to indicate that the
Springs required a local office of a larger bank.
Through its attorneys the applicant had submitted supplemental
Information in support of its request for reconsideration and an
oPportunity to present the matter orally before the Board.
Among other
things, that information presented a more detailed analysis of the
service area of Mount Holly Springs, which the applicant contended
Should include territory within a five-mile radius.
The applicant also
referred to three bank mergers in the Harrisburg-Carlisle-York area
that had been approved by the Comptroller of the Currency subsequent
to the filing of Dauphin Deposit's application.
Figures were presented
Showing the increases in banking concentration in Dauphin and Cumberland
it was contended that
Counties that had resulted from those mergers, and
the increase that would result from the merger proposed by Dauphin
effect on its deposit
Deposit Trust Company would have only a minute
and office standings in the two counties.
The supplemental information
also included as an exhibit a copy of the letter sent to the Board on
October
3, 1962, by the Secretary of Banking of Pennsylvania, in which he
385
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1/31/63
set forth his reasons for approving Dauphin Deposit's merger application
and made certain Observations comparing the Board's action and the action
of the Comptroller of the Currency in a number of mergers.
concluded by saying:
His letter
"In view of the Comptroller's liberal policies,
I urge your Board to give great consideration to the desires of the owners
Of the merging institutions since the banking and competition factors
involved do not appear clearly negative."
The Division of Examinations' portion of the January 18, 1963,
memorandum analyzed and appraised the various arguments advanced in the
supplemental information that had been submitted.
It was observed that
When the merger application was originally submitted to the Board, the
Division recommended approval.
Had the expanded information been available
When the application was first considered, the Division would have felt
its favorable recommendation was supported even more strongly.
On the other
hand, the supplemental information was not, in the opinion of the Division,
Of such nature as to require reconsideration of the application by the
Board.
It was principally a refinement of the information originally
submitted.
the January 18 memorandum cited
The Legal Division's portion of
the provision in the Board's Rules of Procedure that "the Board will not
action" in a bank holding
grant any request for reconsideration of its
company or merger case (1) "unless the request presents relevant facts
that, for good cause shown, were not previously presented to the Board,"
Or (2) "unless it otherwise appears to the Board that reconsideration would
f"..4C
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1/31/63
be appropriate." After reviewing court decisions and the practices of
Government agencies on questions of this kind, the Division concluded
that it would be within the discretion of the Board to reconsider the
application of Dauphin Deposit Trust Company and, if the Board so desired,
to order an oral presentation.
However, it was also felt that the Board
would be justified in not granting reconsideration unless the Board
believed that new evidence material to the decision had now been offered
Which, for sound reason, was not submitted in the first place.
Mr. Leavitt began the discussion by summarizing the principal
Points made by the Division of Examinations in the January 18 memorandum.
In explanation of the references in the memorandum to a special opportunity
that had been afforded the applicant to submit information, he stated
that the Division had considered inadequate the information in the original
aPPlication relating to competition between the two banks, and therefore
had asked the Philadelphia Reserve Bank to obtain additional information.
In citing several of the specific points advanced in the request for
reconsideration, he brought out that each of them had been weighed by
the Board in its original consideration of the application.
Mr. Shay and Miss Hart then commented upon the legal aspects
of the request, observing that the provision in the Board's Rules of
Procedure to the effect that reconsideration might be granted if it
"appears to the Board that reconsideration would be appropriate" allowed
broad discretion.
A special circumstance that might bear upon the
Board's reaction to this particular request was that in 1961 the Board
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1/31/63
denied an application by the same bank to merge with Camp Curtin Trust
Company, Harrisburg, Pennsylvania, but granted a request for reconsideration and then reversed its decision.
It was also noted that in a
recent case a State bank commissioner had asked the Board to reconsider
a denied merger application, but the Board had refused.
Governor Mitchell observed that the area involved was not far
from Washington and made the tentative suggestion that appropriate members
Of the Board's staff might go there, perhaps in company with representatives
of the Philadelphia Reserve Bank, to make an on-the-spot study.
view, the definition of the market area was important.
In his
On merger and
not believe the Board
holding company applications in general, he did
was getting adequate delineation of market areas.
As to the immediate
the market area, it might be
aPplication, in addition to a study of
of the banks involved.
helpful to have a study of the loan portfolios
y was that such a study,
The general reaction to this possibilit
a
conducted at the present stage of this particular case, might set
the future.
Precedent that would cause difficulty in
There was general
Mitchell's suggestion should be borne
agreement, however, that Governor
in mind for future u3es.
Governor Mills, who dissented from the original decision,
stated that he would abstain from participating in the decision on
the request
for reconsideration. He had been of the opinion that the
Market area taken into account by the Board in reaching its original
adverse decision was too small; in his opinion, it should have been the
388
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1/31/63
whole York-Harrisburg area.
Therefore, he felt that Counsel for Dauphin
Deposit had reason to attempt to rebut the Board's view concerning the
Significant market area.
An unusual factor involved in this case was
that, while the Board had denied the Dauphin Deposit-Mount Holly Springs
merger, the Comptroller of the Currency had approved three other
mergers in the same general area, thus resulting in intensification of
the banking concentration with which the Board had been concerned.
Thus,
an injustice may have been done to Dauphin Deposit, but it would be
difficult to correct in present circumstances.
Governor Robertson suggested that the very purpose of adopting
the Rules of Procedure was to block off reconsideration in the absence
of a showing of substantial evidence that was not available previously.
for reconsideration should
Therefore, he felt that the present request
be denied.
general he believed the rule
Governor Shepardson said that in
that reconsideration would be granted only when substantial new information was offered was appropriate.
However, in the present case a
Peculiar situation had developed.
The approval of other mergers by the
ion in the
Comptroller of the Currency had aggravated banking concentrat
area.
to deny the request for reconGovernor Shepardson was inclined
sideration, yet he felt that a reason had developed for this particular
bank to feel that it had been dealt with inequitably.
could be resolved, he did not know.
How that dilemma
If the application were being
considered under present circumstances, he would be inclined, he thought,
389
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1/31/63
to vote for approval; yet reconsideration, possibly resulting in approval,
would raise issues relating to the administration of the merger law.
Governor Mitchell stated that his feelings were about evenly
balanced regarding the request for reconsideration.
If reconsideration
was granted, he would not be satisfied with the information now in hand
and would want a further investigation.
He would also want information
on the general trend of banking in Pennsylvania, because he thought it
important to get a sense of the direction in which the State was going.
While he believed there was enough new evidence to support a decision
for reconsideration, the arguments against it were also strong.
Chairman Martin commented that the situation presented a difficult
Problem,
It seemed clear to him, in one sense, that the Board should not
grant reconsideration, particularly in the light of the Board's published
Rules of Procedure.
However, in merger cases the Board was, so to speak,
in the position of acting as a court of justice, and there might be a
question whether justice was being rendered.
In response to an inquiry as to how much time must elapse before
Dauphin Deposit could submit a new application to merge with the Mount
Holly Springs bank, Mr. Shay responded that neither the Bank Merger Act
nor the Board's Rules of Procedure set a time that must pass before a new
application could be submitted.
It might be said that in general, when-
ever a reasonable time had passed since denial of a first application, a
second one might be submitted, especially if the applicant could cite
interim developments that had resulted in a significant change in circumstances.
In his opinion, a new application might be a better procedure
-12-
1/31/63
than reconsideration of the Board's original decision.
Consent to
reconsideration might foster the impression that an applicant bank
could serve its best interests by making a "lazy" first presentation
of its case, so that it could more easily obtain reconsideration in
the event of denial by having additional information to submit.
Governor Mills then stated that if the Dauphin Deposit application
were under consideration at the present time as a new application, he
felt that he would vote to deny it.
Following the mergers approved by
the Comptroller of the Currency in the same general area, it would be
another step toward undue concentration of banking resources and
restriction of competition.
Following further discussion, Governor Shepardson expressed
the view that the Board must look beyond the present case.
There were
other situations of the same kind developing, and it would seem desirable
for the Board to be prepared to meet them with clearly defined standards.
He viewed with concern a development whereby the Board would be placed
in a position of seeming to be unjust because of the use of different
standards by other supervisory authorities.
Such a situation might do
damage to the banking community, and it might call for re-examination by
the Board of its criteria.
The question of the eventual outcome was of
concern to him.
In summarizing the discussion, Chairman Martin referred to the
comment by Governor Mills that if, in present circumstances, the Dauphin
Deposit application were coming before the Board as a new application, he
1/31/63
-13-
(Governor Mills) would be disposed to deny it.
the passage of time had introduced new factors.
Board's control had entered into the matter.
Thus, the Chairman noted,
Circumstances beyond the
In this situation, he was
not convinced that reconsideration would prove to be profitable from
anyone's standpoint.
The request of Dauphin Deposit Trust Company for reconsideration
was then denied, Governor Mills abstaining.
Governor Shepardson agreed that, all things considered, this
was probably the best decision.
He continued to be concerned, however,
by the question of equity.
A copy of the letter conveying the Board's decision to Counsel
for Dauphin Deposit Trust Company is attached as Item No.
9.
Mr. Kelleher, Director, Division of Administrative Services,
entered the room during the preceding discussion and at its conclusion
Miss Hart withdrew.
Application of First State Bank, Canisteo, New York.
There had
been distributed a memorandum dated January 22, 1963, from the Division
of Examinations and other pertinent papers regarding the application of
First State Bank, Canisteo, New York, for consent to purchase the assets
and assume liability to pay deposits in the Greenwood Branch of Security
Trust Company of Rochester, Rochester, New York.
The Division's
recommendation was favorable.
Mr. Leavitt commented on the application, basing his remarks
on the information contained in the file on the matter, following which
1/31/63
the application was approved unanimously, with the understanding that
an order and statement reflecting this decision would be prepared for the
Board's consideration.
Messrs. Solomon, Shay, Leavitt, Hunter, and White then withdrew.
Federal employee parking survey (Item No. 10).
There had been
distributed a memorandum dated January 30, 1963, from Governor Shepardson
regarding a request from the Budget Bureau for comment on the report of
a Federal employee parking survey made by General Services Administration
in 1961.
Among other things, the report recommended (1) that the Public
Buildings Service request authorizing legislation to deal with the
parking problem; (2) that the Government should initially charge $5 a
month for parking space in the "core area"; and (3) that the legislation
Should assure that agencies now "administering their own parking spaces
in connection with managing their own buildings" would participate in the
contemplated program.
The memorandum stated that the proposal that
Government agencies make a monthly charge for parking space appeared to
Present no serious problem as far as the Board was concerned.
Of more
serious import was the question whether the Board should give any
Indication that it would accede to a program that would apparently place
the Board's garage and parking lot under the direction and supervision
of General Services Administration.
If the Board should respond to the
Budget Bureau's request by indicating sympathy with the objectives of the
report, this might be construed as acquiescence in the proposed program.
On the other hand, a response asserting the independence of the Board,
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1/31/63
with a reference to the provisions of the Federal Reserve Act giving
the Board sole control of its building, could conceivably raise an
issue that might lead to controversy.
Attached to the memorandum was
a draft of reply to the Budget Bureau in terms that did not raise the
issue of the independence of the Board.
The memorandum included, however,
a possible alternative paragraph for the draft letter that would cite
the apparent statutory intent that the Board control its own building.
Discussion developed a consensus that, despite the fact that
it was perhaps unlikely that legislation such as the report suggested
would be enacted, the Board should take a firm position against being
covered by any such legislation.
Along these lines, the view was
expressed that the letter should call attention to the pertinent
Provisions of the Federal Reserve Act and that, in the circumstances,
it would seem undesirable for the Board to be represented on any
committee that might be established to study the parking problem.
Accordingly, unanimous approval was given to a letter to the
Budget Bureau in the form attached as Item No. 10.
Governor Balderston returned to the meeting at this point.
After Chairman Martin had reviewed the actions that the Board had taken
during his absence, Governor Balderston indicated that he would like to
be recorded in favor of those actions.
Foreign travel.
Governor Shepardson stated that a letter
had been received from the Bank for International Settlements, Basle,
19(1
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1/31/63
Switzerland, inviting the Federal Reserve System to send representatives
to a meeting of central bank economists to be held at the Bank on
March 9-11, 1963.
At Governor Shepardson's suggestion, the attendance
of Mr. Noyes, Director of the Division of Research and Statistics, was
approved unanimously, with the understanding that the attendance of
another senior member of the staff was authorized should Mr. Noyes be
unable to undertake the assignment.
It was understood that the
representation of the System would also include Alan Holmes, Vice
President of the Federal Reserve Bank of New York, or George Garvy,
Economic Adviser of the Bank, as alternate.
The meeting then adjourned.
Secre
"
Item No.
BOARD OF GOVERNORS
1/31/63
OF THE
FEDERAL RESERVE SYSTEM
WASHgiNGTON 25, 0. C.
ADDRESS
'
,
.- 111AL CORRESPONDENCE
TCI
;'" BOARD
ps.s•
January 31,
!, 1961,
Morgan Gua:cnty :mterneAonal
Finance Corppration,
23 Wall Street:
New York 81 New .nrk.
Gentlemen:
he basis of te
72A accordance with the :facluest and on
information furnished in ye.= letter5. of November 20 and December 14,
1962, transmitted throuh the Federal F,eserve Bank of New York the
Board of Governors grants its consent for Yorgan Gnaranty International Finance Corporation to purchase and. hole 1,97:0 shares s par
value Swiss Francs 100 each, of the capital stock of Hoiding Com?ally
for Financing and Credit Ltd., ("Eurocreditr, Basle, Switzer1and:
at a cost of approximately US$23,1801 pro.trLded such stock is acgaired
within one year from the date of this letter.
The Board's consent is granted u)o.7. condition that MGIFO
811[411 dispose of its holding of stock of Eurccredtt,
Promptly as
Practicable, in the event that Eurccredit should at any time (1) engage in issuing, underwriting, selling or distributing escurities
in the United States; :2) engage in the genera:. business of buying
or selling goods, wares, merchandise, or commodities in the United
States or transact any business in the United States except such as
is incidental to its international or fersign business; or (3) otherwise conduct its operations in a manner which, in the judgment of
the Board of Governors, causes the continued holding of its stock
by MGIFC to be inappropriate uncle:: the 2rovisioas of Section 25(a)
of the Federal Reserve Act or regulations thereunder.
Very truly yours,
(signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
19f;
Item No. 2
BOARD OF GOVERNORS
1/31/63
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDCNCE
TO THE BOARD
Janaury 31, 1963
Morgan Guaranty International
Finance Corporation,
23 Wall Street,
New York 8, New York.
Gentlemen:
In accordance with the request and on the basis of the
J.nrcrmation furnished in your letter of November 27, 1962, transmied through the Federal Reserve Bank of New York, the Board of
Governors grants its consent for Morgan Guaranty International
Finance Corporation ('INGIFC") to acquire and hold 187,793 shares,
par value Australian Shillings 10 each, of Australian United Corporation Limited (nAUCL,1), Melbourne, Australia, in exchange for
its present holding of 50,000 shares of Anglo-Australian Corporation Pty. Limited and payment in the amount of Australian £264,800,
or approximately US$593,150, provided such stock is acquired within
one year from the date of this letter.
The Board's consent is granted upon condition that MGIFC
shall dispose of its holding of stock of AUCL, as promptly as practicable, in the event that AUCL should at any time (1) engage in
issuing, underwriting, selling or distributing securities in the
United States; (2) engage in the general business of buying or
selling goods, wares, merchandise, or commodities in the United
States or transact any business in the United States except such
as is incidental to its international or foreign business; or (3)
Otherwise conduct its operations in a manner which, in the judgment
Of the Board of Governors, causes the continued holding of its
stock by MGIFC to be inappropriate aader the provisions of Section
25(a) of the Federal Reserve Lct or regulations thereunder.
The Board's consent is given wit!' the additional condition that neither AUCL nor any siLciditry will maintain any branch,
agency, office, or representatdva in the United States and that
AUCL or any subsidiary;in issthg, undsrwriting, selling Lr distriblatin7 securities i.broacl; 81=11 ::.ct engage or participate in the
L, r!!! ae:ur:Ltiss in the United States,
underwriting, ss:e Jr LLstr!.buti,
HOARD OF C3OVERNCIRS OF THE FEDERAL RESERVE SYSTEM
Morgan Guaranty International
Finance Corporation
and may not so engage or participate directly or indirectly or
through an agency or on a commission or consignment basis or in
any other manner. If a security issue is being sold or distributed
partly in and partly outside the United States, AUCL or any subsidiary may not underwrite, even on a standby basis, that portion
being sold or distributed in the United States (no matter by whom
it is being so sold or distributed.)
It is understood that AUCL will not engage in the business
of receiving or paying out deposits, or accepting drafts or bills
of exchange, and the Board's consent is given subject to this further condition.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
39'7
•
BOARD OF GOVERNORS
Item No. 3
1/31/63
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
January 31, 1963
Morgan Guaranty International
Finance Corporation,
23 Wall Street,
New York 8, New York.
Gentlemen:
In accordance with the request and on the basis of the
information furnished in your letters of December 3 and December 28,
1962, and January 9, 1963, transmitted through the Federal Reserve
Bank of New York, the Board of Governors grants its consent for
Morgan Guaranty International Finance Corporation ("MGIFC") to purchase and hold up to 21,000 shares, par value Italian Lire 5,000
each, of the capital stock of Euramerica Finanziaria Internazionale,
S.p.A., Rome, Italy ("EFI), at a cost of approximately US$170,000,
Provided such stock is acquired within one year from the date of
this letter.
The Board's consent is granted upon condition that MGIFC
shall dispose of its holding of stock of EFI, as promptly as practicable, in the event that EFI should at any time (1) engage in
issuing, underwriting, selling or distributing securities in the
United States; (2) engage in the general business of buying or selling
goods, wares, merchandise, or commodities in the United States or
transact any business in the United States except such as is incidental to its international or foreign business; or (3) otherwise
conduct its operations in a manner which, in the judgment of the
Board of Governors, causes the continued holding of its stock by
MGIFC to be inappropriate under the provisions of Section 25(a) of
the Federal Reserve Act or regulations thereunder.
The Board's consent is given with the additional condition
that neither EFI nor any subsidiary will maintain any branch, agency,
office, or representative in the United States and that EFI or any
subsidiary, in issuing, underwriting, selling or distributing securities abroad, shall not engage or participage in the underwriting,
sale or distribution of securities in the United States, and may not
so engage or participate directly or indirectly or through an agency
or on a commission or consignment basis or in any other manner.
BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
Morgan Guaranty International
Finance Corporation
If a security issue is being sold or distributed partly in and
partly outside the United States, EFI or any subsidiary may not
underwrite, even on a standby basis, that portion being sold or
distributed in the United States (no matter by whom it is being
so sold or distributed.)
It is understood that ELPI will not engage in the business of receiving or paying out deposits, or accepting drafts or
bills of exchange, and the Boards consent is given subject to
this further condition.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
100
Item No.
BOARD OF GOVERNORS
4
1/31/63
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
January 31, 1963
Board of Directors,
Union Trust Company. of Ellsworth,
Ellsworth, Maine.
Gentlemen:
The Board of Governors has approved an
extension until January 24, 1964, of the time within
which Union Trust Company of Ellsworth may establish
a branch at Outer High Street, Ellsworth, Maine.
The establishment of this branch was authorized in a
letter dated January 24, 1962.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
BOARD OF GOVERNORS
Item No.
5
1/31/63
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
January 31, 1963
Board of Directors,
The Central Trust Company,
Cincinnati, Ohio.
Gentlemen:
s of the Federal Reserve System
The Board of Governor
1963, the time within which The Central
extends to November 1,
ti, Ohio, may establish a branch at
Trust Company, Cincinna
Cincinnati, Ohio, under authority granted
3300 Central Parkway,
dated January 24, 1962.
in the Board's letter
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
4!(,)2,
'
BOARD OF GOVERNORS
Item No.
6
1/31/63
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
January
31, 1963
Mr. Max G. Brooks, President,
The Central Bank and Trust Co.,
Denver, Colorado.
Dear Mr. Brooks:
This refers to your letter of January 16, 1963,
addressed to Mr. L. F. Mills, Vice President of the Federal
Reserve Bank in Kansas City, in which you requested that
a public hearing be held on the application of Denver U.S.
Bancorporation for permission to become a bank holding
company. You requested that if a public hearing is denied,
you be permitted to file a written objection to the application, although the thirty-day period for filing written
comments has expired.
If you wish to file a statement setting forth
it will be considered by the Board not
objections,
your
with your request for a public proceedconnection
only in
but also in reaching a decision on the
matter,
the
ing in
of the time that has already elapsed,
view
In
application.
be received by the Board not
should
statement
any such
date of this letter.
the
from
days
ten
later than
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
S-1860
BOARD OF GOVERNORS
OF THE
Item No.
FEDERAL RESERVE SYSTEM
7
1/31/63
WASHINGTON 25. D. C.
NCE
ADDRESS OFFICIAL CORRICISPONDIE
TO THE BOARD
January 31, 1963.
Dear Sir:
ion whether savings
The Board recently considered the quest
another bank for a period of
deposits that have been on deposit in
by a member bank through
at least 12 months and which are acquired
n on deposit for an additional 12
assumption of liability must remai
at the maximum 4 per cent rate.
months in order to receive interest
remained on
Although the words "any savings deposit that has
ion 217.6),
(sect
Q
ation
to
Regul
ement
Suppl
the
deposit," as contained in
it in the same bank, the
contemplate that normally this means a depos
a member bank takes over
where
cases
in
Board is of the opinion that
ase of assets, savings
or
purch
ion,
another bank by merger, consolidat
g been on deposit .
havin
as
ed
be
treat
accounts in such other bank may
it in the absorbed
in the resulting bank for the time they were on depos
bank.
Very truly yours,
Secretary.
TO THE PRESIDENTS OF ALL FEDERAL RESERVE BANKS
104
BOARD OF GOVERNORS
Item No. 8
1/31/63
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
January 31, 1963
AIR MAIL
Mr. George H. Ellis, President,
Federal Reserve Bank of Boston,
Boston 6, Massachusetts.
Dear Mr. Ellis:
ry 14, 1963,
This refers to Mr. Stone's letter of Janua
National Bank of Nashua, New
transmitting a request by Indian Head
ct to the payment of interest on
Hampshire, for a ruling with respe
s" to be acquired by the bank as
funds represented by "savings share
and assumption of liabilities
s
asset
the result of the purchase of
nal bank wishes to know
The
natio
of Claremont Co-operative Bank.
the maximum 4 per cent
at
est
whether it may immediately pay inter
the other bank for a
in
sit"
rate on funds that have been on "depo
period of at least 12 months.
Mr. Stone,
Reference to the New Hampshire Statutes, cited by
lly a building and
reveals that Claremont Co-operative Bank is actua
of the pass book
cover
the
that
noted
loan association. Also, it is
ates that the
indic
ded
recor
are
s
in which payments on these share
Insurance
Loan
and
gs
Savin
al
accounts are insured by the Feder
of relationtype
new
a
that
r
appea
Corporation. Therefore, it would
sit", in the usual
ship will be created and that there was no "depo
nal bank took over
natio
the
e
befor
ing
definition of that term, exist
conclusion that a
these accounts. This would seem to suggest the
could not pay
new contract is created and that the national bank
ed.
interest at 4 per cent until 12 months have elaps
ion of the customer
It is believed, however, that the posit
no action on his part he
is entitled to some consideration. Through
er institution. As the
would find his funds transferred to anoth
dividends at 4 per cent, he
customer has been receiving currently
ar rate of return would be due
could logically reason that a simil
months. Furthermore, the
him on the same funds without waiting 12
BOARD
OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
Mr. George H. Ellis
-2-
Supplement to Regulation Q (section 217.6), provides that the 4 per
cent rate may be paid "on that portion of any savings deposit that
has remained on deposit for not less than 12 months'. In the circumstances of this particular case, the Board will not object to the bank,
cent
as successor institution, paying interest at the rate of 4 per
as
its
books
savings
on
d
per annum on amounts that are continue
accounts without waiting an additional 12 months before interest at
that rate may be paid.
Very truly yours,
Merritt Shean,
Secretary.
BOARD OF GOVERNORS
Item No. 9
1/31/63
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
January 31, 1963.
Martin P. Snyder, Esq.,
Morgan, Lewis & Bockius,
Counselors at Law,
2107 Fidelity-Philadelphia Trust Building,
Philadelphia 9, Pennsylvania.
Dear Mr. Snyder:
client,
This refers to a series of communications from your
from
and
,
Pennsylvania
Harrisburg,
the Dauphin Deposit Trust Company,
the
with
connection
in
Your firm, which the Board has considered
National
application for the Board's consent to the merger of The First
request
the
with
and
Deposit,
Bank of Mount Holly Springs into Dauphin
for reconsideration of the Board's denial, dated July 13, 1962, of
that application. These communications include the original
application filed with the Board on April 13, 1962, supplemental
in
Information in support of that application which was supplied
response to a request made by the Board in May 1962, your letter of
September 28, 1962, requesting reconsideration of the denial and
°PPortunity for oral presentation, and the information supplementing
that request sent on November 27, 1962, in response to a letter from
the Board of October 24, 1962.
The information and views presented in support of the request
for reconsideration and for oral presentation have been carefully
considered. However, in the Board's judgment such information and
views do not differ essentially from those contained in the original
a pplication by Dauphin Deposit for the Board's approval of the merger.
It does not appear to the Board that there has been submitted to it
s ignificant information not previously presented in this case, and the
Board has concluded that neither reconsideration nor oral presentation
in reference to its prior action on this application would be
a ppropriate. Accordingly the Board denies your requests.
1'4
Martin P. Snyder, Esq.
-2-
In view of your representation in this case separate
notification of the Board's action has not been sent to either
of the banks involved in the application.
Very truly yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
408
BOARD OF GOVERNORS
Item No. 10
OF THE
1/31/63
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
February 1, 1963.
Mr. Harold Seidman,
Acting Assistant Director for
Management and Organization,
Bureau of the Budget,
Washington 25,.D.
Dear Mr. Seidman:
This is in response to the request contained in your letter of
December 6, 1962, asking for comments or suggestions on the Federal Employee
Parking and Transportation Survey Report submitted by the General Services
Administration.
As the Report indicates, the parking problem in downtown Washington
is becoming increasingly critical, and measures to alleviate the situation,
Particularly plans for improved mass transit, merit serious consideration.
The Board itself, because it is a small organization, has not been faced with
a problem in this respect. When the Board's building was constructed in 1937
pursuant to special authorization of Congress, provision was made for the
. Parking requirements of its members and employees, and the facilities provided for this purpose are still reasonably adequate.
It has not been necessary for the members of the Federal Reserve
(2ganizati0n to use the streets for parking in the past, and there is no likelihood that such a need will develop in the future. In this connection,
t
section 10 of the Federal Reserve Act clearly indicates the intent of Congress
•at the Board shall have "sole control" of its building and the space therein;
and the Board believes that, in view of the nature of its functions, this
should be preserved. In the circumstances, the Board does not bePrincipleeve
at representation of this organization on the Interagency Advisory
Committee for Federal Employee Parking would serve any useful purpose.
Very truly yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
@FedFRASER