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I G38 A meeting of the Executive Committee of the Federal Reserve Board was held in Washington on Monday, July 22, 1955, at 2:50 p. m. PRESENT: Mr. Mr. Mr. Mr. Thomas, Vice Governor Hamlin James Szymczak Mr. Morrill, Secretary Mr. Carpenter, Assistant Secretary The Committee acted upon the following matters: Memorandum from Mr. Carpenter, Assistant Secretary, recommendthat, on account of the absence of two operators in the Washington telegraph office caused by the illness of one and by a death in the faniaY of the other, Mr. C. L. Norris, vacation relief operator who i8 working on a part time schedule, be placed on a full time basis, With salary at the rate of '466 per month, effective July 25, 1955, and to continue until the return of either of the operators now absent. Approved. Letter to Mr. Sailer, Deputy Governor of the Federal Reserve 84nk of New York, reading as follows: "The Federal Reserve Board approves the recommendation contained in your letter of July 16 that the temporary assignment of Miss Mae Murray to the position of Junior Clerk, G-50 Maintenance Division, Building Operating Department, at an annual salary Of $1,660, which is $60 in excess of the salary range provided for this position, be continued for an additional four months from July 16." Approved. Letter to the board of directors of the "Commonwealth Bank of 41timoren, Baltimore, Maryland, stating that, subject to the conditi°ns prescribed in the letter, the Board approves the bank's application Ga9 7/22/35 —2— for membership in the Federal Reserve System and for the appropriate amount of stock in the Federal Reserve Bank of Richmond. Approved. Letter to "The Boardwalk National Bank of Atlantic City", Atlantic City, New Jersey, reading as follows: "The Federal Reserve Board has given consideration to your application for permission to exercise fiduciary powers, and grants you authority to act, when not in contravention of State or local law, as trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver, committee of estates of lunatics, or in any other fiduciary capacity in which State banks, trust companies or other corporations which come into competition With national banks are permitted to act under the laws of the State of New Jersey, the exercise of all such rights to be subject to the Provisions of the Federal Reserve Act and the regulations of the Federal Reserve Board. "This letter will be your authority to exercise the fiduciary Powers granted by the Board. A formal certificate covering such authorization will be forwarded to you in due course." Approved. Letter to "The National Bank of Bay City", Bay City, Michigan, l'eading as follows: "The Federal Reserve Board has given consideration to your application for permission to exercise fiduciary powers, and grants You authority to act, when not in contravention of State or local law, as trustee, only in connection with the liquidation of assets Of Bay County Savings Bank, Bay City, Michigan, and First National Bank of Bay City, Bay City, Michigan, the exercise of such right to be subject to the provisions of the Federal Reserve Act and the regulations of the Federal Reserve Board." Approved. Letter to Mr. Walsh, Chairman of the Federal Reserve Bank of °alias, reading as follows: "The Board has reviewed the report of examination of the 1640 7/22/35 -3-- "Federal Reserve Ban': of Dallas as of May 11, 1935, copies of which were left with you and Governor McKinney, and the brief forwarded With your letter of July 10, 19350 prepared by a committee of officers of the bank in connection with the criticisms and suggestions contained in the report. "In connection with the advance made by the Federal Reserve Bank under the provisions of section 13b of the Federal Reserve Act to the Southern Properties, Incorporated, the Board has been advised that among the secured creditors of the Southern Properties, Incorporated, who apparently benefited from the reorganization made Possible by the advance from the Reserve Bank, is Mr. Eugene P. Locke, a member of the firm of Locke, Lockej Stroud and Randolph, Which firm represents the Federal Reserve Bank. It is understood that Messrs. Locke, Locke, Stroud and Randolph acted as attorneys for Mr. Eugene P. Locke, who, since the reorganization of the Southern Properties, Incorporated, holds all of the preferred stock of that company. It will be appreciated if you will furnish the Board With advice as to the attorneys who represented the Federal Reserve Bank in passing upon the legal phases of the advance under section 13b to the Southern Properties, Incorporated, advice as to the attorneys who represented any other interested parties to the transaction, and detailed advice as to the nature of the interest of Lr. Eugene P. Locke in the Southern Properties, Incorporated, together with any facts which may have a bearing on these phases of the matter and any comments you deem desirable in the premises." Approved. Letter to The Postmaster General of the United States, reading EtS f% "The Board has been advised that under date of July 11, 1935, the Third Assistant Postmaster General wrote to Mx. H. H. Sanders, 32 Broadway, New York City, advising him that it is not necessary to carry reserves against deposits of postal savings funds. "In the first paragraph of section 19 of the Federal Reserve Act, postal savings deposits are specifically included in the definition of time deposits and, accordingly, under the provisions of section 19, a member bank of the Federal Reserve System is required to maintain with its Federal Reserve bank a 5 percent reserve against all such deposits. "In view of these provisions of law it is believed that you Will wish to take steps to correct any misunderstanding that may have been occasioned by Mr. Eilenberger's letter." Approved. 1641 7/22/35 Letter to Mr. C. D. Curtis, Chief, Division of Control, Bureau of Public Roads, United States Department of Agriculture, readas follows: "This refers to your letter of July 16, 1935, notifying the Board that one of your employees has reported that the banks of Arkansas are charging exchange on Government salary and expense checks and requesting the Board to take such action with respect to the mntter as it deems necessary. "The imposition of exchange or collection charges by a bank Which is neither a member of the Federal Reserve System nor a depositor in a Federal Reserve bank is, of course, not within the control of the Federal Reserve Board and even banks which are members of the System are permitted by the provisions of the first paragraph of section 13 of the Federal Reserve Act to impose reasonable charges not exceeding 100 per .100 or fraction thereof for the collection or payment of checks and drafts provided that no such charge is made against a Federal Reserve bank. Accordingly, there is nothing in the law to prevent a member bank, if it desires to do so, from making an exchange or collection charge in an amount not exceeding that stated, with respect to United States Government checks, as well as with respect to other checks, if such Charges are not made against a Federal Reserve bank. Under the law the Federal Reserve Board is empowered to regulate the amount of such charges within the limit specified but the Board has issued no such regulation. "In the absence of evidence that a member bank or a nonmember bank which maintains with a Federal Reserve bank a balance as permitted by the first paragraph of section l3 is imposing exchange or collection charges in excess of the maximum amount permitted by the statute, there would seem to be no action which the Board can properly take in this matter." Approved. Letters to applicants for Clayton Act permits advising respectof the issuance of permits by the Board as follows: Ur. H. B. Mitchell, to serve at the same time as a director and officer of The First National Bank of Emlenton, Fmlenton, Pennsylvania, as a director of The Peoples National Bank of East Brady, East Brady, Pennsylvania, and as a director and Officer of the Peeples National Bank of Clintonville, Clintonville, Pennsylvania, for the period ending January 14, 1936. 142 V22/55 Ur. John Franklin Eddy, to serve at the same time as a director of The National Bank of Bay City, Bay City, Michigan, and as an employee of the Peoples Bank and Trust Company, Seattle, Washington, for the period ending January 14, 1956. Approved. Thereupon the meeting adjourned. r?emfzi., Approved: Vice Governor. secretary.
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