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Minutes for
To:
Members of the Board
From:
Office of the Secretary
June 15, 1959
Attached is a copy of the minutes of the
Board of 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, if you
were present at the meeting, please initial in
column A below to indicate that you approve the
minutes. If you were not present, please initial
in column B below to indicate that you have seen
the minutes.
A
Chin. Martin
Gov. Szymczak
Gov. Mills
Gov. Robertson
Gov. Balderston
Gov. Shepardson
Gov. King
Minutes of the Board of Governors of the Federal Reserve System
on
Monday, June 15, 1959.
PRESENT:
Mr.
Mr.
Mr.
Mr.
Mr.
The Board met in the Board Room at 10:00
Martin, Chairman 1/
Szymczak
Robertson
Shepardson
King
Mr.
Mr.
Mr.
Mr.
Sherman, Secretary
Kenyon, Assistant Secretary
Fauver, Assistant Secretary
Thomas, Economic Adviser to the Board
Messrs. Garfield, Robinson, Williams, Dembitz,
Altmann, Brill, Eckert, Fisher, Keir, Manookian,
Peret, and Wernick, and Miss Dingle of the
Division of Research and Statistics
Messrs. Marget, Furth, Hersey, Sammons, Irvine,
Reynolds, and Wood of the Division of International Finance
Economic review.
The Divisions of International Finance and
Research and Statistics presented a review of recent international and
cl°meetic economic and financial developments during the course of which
Governor Szymczak joined the meeting.
Following the presentation and discussion of questions related
thereto) all of the members of the staff except Messrs. Sherman and
lellY°11 withdrew from the meeting.
Application to establish a national bank in Cheyenne, Wyoming
Item N
,„
At the meeting on Friday, June 12, consideration was
t° a draft of proposed letter to the Comptroller of the Currency,
,
with r
-gard to an application to establish a national bank in Cheyenne,
At+
.eaded afternoon session only.
-ntered meeting at point indicated in minutes.
6/15/59
-2-
WY°rning, which recommended that the application be held in abeyance
13e4ding the availability of permanent banking quarters.
were
fOZ
Other factors
favorable, and doubt was expressed that sufficient reason existed
suggesting that the application not be acted upon favorably at this
time.
Accordingly, it was understood that, in accordance with the usnal
pr
actice, a check would be made with the Federal Reserve Bank of Kansas
itY to ascertain whether the
Bank wished to present any further views.
Mr. Sherman stated that he and Mr. Benner, Assistant Director
ef the Division of Examinations,
han talked with Chief Examiner Mills
or the
Kansas City Reserve Bank, and later with Vice President Woolley.
Mr. Voolley
agreed that the application was generally satisfactory and
t44t there was
a place for an additional bank in Cheyenne.
hay
nO
He would
particular objection, therefore, if the Board wished to recommend
41313r°v'sa of the application, and he did not think that others within
the Reserve Bank would
Object.
However, he did not care to change his
Ylo
sition, which was that it would be undesirable for the new bank
to
in temporary
quarters.
It was his feeling that the organizers
ot the
new bank preferably
should wait until one of the existing banks
14
Cheyenne which was erecting a new
building, had vacated its present
tillszters and
then, in accordance with the original plan, take over the
EteEtted- Premises.
Mr. Sherman then read a draft of letter to the Comptroller of
the our.
rencY recommending favorable consideration of the application
6/15/59
-3-
Provided the proposed bank was able to arrange for appropriate
temporary quarters, and it was agreed unanimously that the revised
letter should be sent.
A copy is attached as Item No. 1.
Old Kent Bank and Trust Company.
Mr. Sherman referred to a
letter dated June 10, 1959, from Mr. Carl H. Morgenstern, President
°f Old Kent Bank and Trust Company, Grand Rapids, Michigan, who stated
that he and Mr. Siegel W. Judd, Counsel for the Bank, would like to
meet with
members of the Board, preferably this week but at the Board's
convenience if a meeting this week could not be arranged, for discussion
°f the bank's situation.
Mr. Sherman said that after discussion with
the available
members of the Board a reply was prepared and sent over
Chairnian Martin's signature on June 12, 1959, stating that the Board
14)111d be glad to meet
with the Old Kent representatives on one of the
first
three days of next week, preferably Tuesday, June 23.
The letter
e°4tained a suggestion that Old Kent submit a memorandum in the meantime
to
aid the
Board in preparing for the meeting.
Secretary's Note: Counsel for Old Kent later
advised the Board's Secretary that he and Mr.
Morgenstern could not come to Washington until
after July 4 because of other engagements and
indicated that they would be in touch with the
Board's offices again with a view to arranging
a meeting on a mutually convenient date. It
appeared that informal discussion was desired
and that no memorandum would be submitted in
advance of the meeting.
The meeting then recessed and reconvened at 3:00 p.m. with
CliEurraati
Martin present in addition to the other members of the Board
6/15/59
-4-
liho attended the morning session.
The Presidents of the Federal Reserve
Banks also were present, along with invited members of the Board's staff.
The afternoon session was called at Chairman Martin's suggestion
in order that he might review informslly for the other Board members and
the Presidents certain aspects of the hearings being held currently by
the Ways and Means Committee of the House of Representatives with regard
to the Administration proposals to increase the national debt limit,
eliminate the maximum rate limitation on Government bonds, and increase
the rates
payable on United States savings bonds.
Following Chairman Martin's comments and discussion relevant
thereto
meeting adjourned.
Secretary's Note: Governor Shepardson today
approved on behalf of the Board a letter to
the Federal Reserve Bank of Kansas City
(attached Item No. 2) approving the appointment of Richard Lee Nichols as assistant
examiner.
Secretary
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
Item No. 1
6/15/59
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
June 15, 1959
°GIN:troller of the Currency,
7,:esury
Department,
l'-zitington 25, D.
C.
Attention Mr. W. M. Taylor,
Deputy Comptroller of the Currency.
Mr* Comptroller:
Reference is
enclosing copies
ClleYenne,
the aPpli Wyoming, and
cation should
19fA,
made to a letter from your office dated December 9,
of an application to organize a national bank at
requesting a recommendation as to whether or not
be approved.
'formation contained in a report of the investigation of the
-41clic,;'1°n made by an examiner for the Federal Reserve Bank of Kansas City
ko(21
:
0-rrs that the
organizers have agreed to provide a capital structure of
eznourIt
'
0 for the bank instead of $500,000 shown in the application. This
(''Irorab°I capital appears to be adequate. The prospects for earnings are
offiee 'e and it is reported that executive management satisfactory to your
13( ed bwill be
selected. According to the information available, the pro11.':, could develop a satisfactory volume of business and provide a
I6Irte;uulic service to the community. It is reported that the permanent
,Iceord.s to be
occunied by the bank may not be available until January 1962.
the, 141Y, the
Board of Governors recommends favorable consideration of
1°c4Zi
.cetion, provided arrangements are made for an appropriate temporary
T
eNcta
The Board's Division of Examinations will be glad to discuss any
Of this case
with representatives of your office if you so desire.
Very truly yours,
1
Kenneth A. Kenyon,
Assistant Secretary.
BOARD OF GOVERNORS
OF THE
40 ft
Item No. 2
6/15/59
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
444
Ot)
ADDRESS OFFICIAL CORRESPONDENCE
tt4 V4VIV
TO THE BOARD
40**
June 15, 1959.
CONFIDETIAL (FR)
Mr. D. W. Woolley, Vice President,
Federal Reserve Bank of Kansas City,
Kansas City 6, Missouri.
Dear Mr. Woolley:
In accordance with the request contained
in your letter of June 10, 1959, the Board approves
the appointment of Richard Lee Nichols as an assistant examiner for the Federal Reserve Bank of Kansas
City. Please advise as to the date upon which the
appointment is made effective and as to salary rate.
It is noted that Mr. Nichols is indebted
to The Columbia National Bank of Kansas City, Kansas
City, Missouri, in the amount of $942. Accordingly,
the Board's approval of the appointment of
Mr. Nichols is given with the understanding that he
1411 not participate in any examination of that bank
until his indebtedness has been liquidated.
Very truly yours,
(Signed) Kenneth A. Kenyon
Kenneth A. Kenyon,
Assistant Secretary.
@FedFRASER