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10 A meeting of the Federal deserve Board was held in the office of the Governor on Thursday, January 8, 1931, at 11:30 a. m. PRESENT: Governor Meyer Mr. Hamlin Mr. Miller Mr. James Mr. Pole Mr. McClelland, Assistant Jecretary. The Governor reported that the meeting of the Open Market Policy Conference, tentatively arranged for Monday, January 12, has been postponed until dednesday, January 21. He also reported a telephone conversation yesterday with Deputy Governor urgess of the Federal deserve Bank of New York during which he was informed that, except for 5,000,000, all of the y32,000,000 of Government securities Purchased by the Open Market Policy Conference over the year-end, have been Bold. The Governor also reported that Assistant Federal deserve Agent Fletcher, Of the Federal deserve Bank of Cleveland, is desirous of discussing with the Beard the condition of certain state member banks in the Fourth Federal iiaserve District, and there being no objection, stated that arrangements would be made for Mr. Fletcher to appear before the Board on next Tuesday Morning. The Governor then stated that he is planning on 1eavin7 this afternoon for Chicago to spend Friday and Jaturday there, if it meets with the anrroval Of the Board. He then referred to the special order of business for this meeting, namely, the request of the Bank of .hmerica National Trust and Javings 4380ciation for permission to establish a branch at fl2 Nicholas Lane, Lcludon E. t...% 4 ngland, the location of the British-ltalian Banking Jorpora- )) 1,161,51 1'4 -2- tion, which it has purchased., under the permit granted by the Board on November 6, 1929, authorizing the Bank of Italy National Trust and Savings Association to establish a branch at '0.3 i:loorgate, London : C. 2,g1and. He presented a letter dated January 6th from the Comptroller of the Currency, recomLending approval of the request by the Board and also a telegram Of the same date from the Chairman of the iederal Reserve Bank of San Francisco, advising that his Executive Committee feels that it has insufficient information regarding the nature of the applicant's business and needs for such an agency to make favorable recommendation or to impose objection, but that the Committee feels, however, that the applicant has sufficient problems at home requiring attention without entering new fields at this time. The Governor stated that lir. Newton called him over the telephone last -) Aight, and that his remarks were along substantially the same lines as those embodied in the telegram. A detailed discussion then ensued regarding the general banking situation and the condition of the applicant bank, based upon reports of examination of the Bank of Italy National Trust and Savings Association and the Bank of America of California, made just prior to their consolidation. The Comptroller stated that an examination of the consolidated bank was to have been under way by this time, but has been postponed. At the conclusion of the discussion, upon motion, it was voted to transmit the following telegram to the Chairman of the Federal Reserve Bank of San Francisco: "Aeferring to your telegram of January 6, please advise President of applicant bank that the Board feels it would be inadvisable to grant permission to establish branch at this time and under these circumstances, and has therefore deferred action on the request contained in his letter to the Board of December 22, 1930." -3- 1/8/31 The Assistant Secretary reported that under authority granted by the Board on December 27, 1930, Mr. Hamlin, as Acting Lxecutive Officer of the Board, yesterday approved a discount rate of 3./, established by the board of directors of the Federal Reserve Bank of Ot. Louis on all classes of paper Of all maturities, effective today, January 8th. Upon motion the rate of 3/0 established by the St. Louis directors was formally approved. Telegram dated January 5 from the Chairman of the Federal Reserve Bank Of Cleveland, advising that the board of directors on that date voted to make no change in the bank's existing schedule of rates of discount and purchase, except to reduce to 2 1/2;6. the rate at which bankers' acceptances may purchased under resale agreement. dithout objection, noted with approval. Telegrams dated January 7 from the Chairman of the Federal Reserve Bank Of Philadelphia, January 8 from the Chairman of the Federal Aeserve Bank of 4ichmond, and January 7 from the Chairman of the Federal Reserve Bank of Dallas, all advising that their boards of directors at meetings on the dates stated made no changes in the bank's existing schedules of rates of discount Enid purchase. dithout objection, noted with approval. Memorandum dated January 7 from the Director of the Division of Research and Statistics, recommending that the probationary appointment of Miss. Dorothy Fricke, which will expire at the close of business on January 31, 1931, be made permanent at her present salary of lid,440 per annum. Approved. 04.) 1/8/31 -4_ Memorandum dated January 8 from the Assistant secretary, advisin- that the board of directors of the Federal Reserve Bank of Philadelphia haz; reelected Howard A. Loeb as member of the Federal Advisory Council fr, m the Third District for the year 1931, and ha r; voted to continue to pay Mr. Loeb, tn lieu of expenses, 4100 for each meeting of the Council which he attends. Upon motion, the compensation fixed by the Philadelphia directors was approved. Letter dated January 5 from the Chairman of the Federal Reserve Bank Of Cleveland, advising of the election of Mr. J. A. House, President of the Guardian Trust Company of Cleveland, as member of the Federal Advisory Council from the Fourth Federal aeserve District, during the year 1931. Noted. Letters dated January 2 and 7th from the Assistant Federal Reserve Agent at New York, with reference to a reduction in the capital stock of the Utica Trust and Deposit Company, Utica, New York, from 41,000,000 to ,,.200,000, and a consequent adjustment in the capital account of that bank, which now consists of capital - 4500,000; surplus - y500,000; undivided profits - 4200,948 and reserves of approximately 4310,000; the Assistant Federal (eserve Agent a dvising that under the conditions of membership of the Utica bank, it was not required to secure the Board's approval of the reduction in capital, Which was authorized by the State Banking Department. Noted. Letter dated January 6 from the Federal .deserve Agent at Boston, advising that the peculations of Miss Harriett Lincoln, an employee in the Money 13e partment of the bank, which were reported to the Board under date of December 29th, aggregated 4414, which amount has been reimbursed in full by the bonding company; the Federal Reserve Agent stating that the case is an 1/8/31 -5_ unusual one and that it is hoped the Board may not feel that it is necessary to formally notify the United (Jtates District Attorney to whom the defalcation has been reported orally. Noted and ordered filed. Letter dated January 6th from Deputy Governor Crane of the Federal deserve Bank of New York, advising of the percentages of participation of the Federal deserve banks in foreign accounts during 1931, based upon capital and surplus of the banks as of the opening of business January 2, 1931. noted. Memorandum from Counsel dated December 23rd, submitting draft of a proposed reply to a letter addressed to the Board under date of December 19, 1930 by Hon. Louis 2. ;Wadden, member of Congress, requesting comments end suggestions from the Board on a letter addressed to him by a credit Manager residing in new York City, which contains an expression of views With respect to the functions and duties of the Federal Aeserve banks in the matter of supervision of member banks; the proposed reply setting forth the leg'al limitations on the jurisdiction of the Board, and stating that since an expression of the Board's views on the question of amendments to the law are not requested, the Board does not care to express a definite opinion on that question at this time. Upon motion, the proposed letter was approved and ordered transmitted. The Assistant secretary then presented a matter previously circulated 4rnong the members of the Board, namely, memorandum from Counsel dated November 11/ 13, with regard to a proposed circular letter to all 2ederal deserve agents on the subject of the application of the general condition of membership to con- mergers etc.; Counsel submitting a revision of the proposed letter, 1/8/Ji -6- which was referred to him by the ,overnor for comment as to the Board's responsibilities in the premises. After discussion, upon motion, it was voted that action on the proposed circular letter be deferred. The reading of the minutes of the meeting of the Board held on January 6th was dispensed with. 1-11, 042..J Dated, January 6th 8th Aecomb.ending changes in stock at Federal iteserve Banks, as set forth in the Auxiliary Minute Book of this date. cornmenda t ions approved. At 1:10 p. m. the meeting adjourned. 4.1ssis nnt Jecratnry. APpro e : AUXILIARY EINU2E6 (January 8, 1930.) /4 If Reports of standing Committee dated January 6th and 6th, recommending Changes in stock at Federal Reserve Banks, approved as follows: 4PDlication for (MIA:NAL Stock: Pistrict No. 11. Citizens National Bank in dt. Jo, Texas. Shares 15 15 ADplications for ADDITIONAL Stock: aatrict No. 2. First National Bank, Eatontown, New Jersey. 6 First National Bank & Trust Co., Hudson, New York. 30 Mt. Prospect National Bank, Newark, New Jersey. 12 United Jtates Trust Company, New York, h. Y. 2.400 2,446 ZStrict No. 4. Union Trust Company, Pittsburgh, Pennsylvania. 1,800 1,600 60 66 126 alatrict No. 7. First American National Bank and Trust Company, Berwyn, Ill. First National Bank, Peoria, Illinois. kistriat No. 11. Dallas Bank and Trust Company, Dallas, Texas. APAlications for SURENDE2 of Stock: aatrict No. 2. Lincoln National Bank, Newark, N. J. (Cons. Colonial Trust Co. with the above bank) Port Newark National Bank, Newark, N. J. (Insolvent) District No. a. Pirst National Bank, Junction City, Ark. (Insolvent) Pirst National Bank, licLeansboro, Ill. tinsolvent) First National Bank, Jest Salem, Ill. (Insolvent) 135 135 4,509 270 150 27 36 20 420 83 503 Assistant Secretary. Approved:
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