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Minutes for
To:
Members of the Board
From:
Office of the Secretary
June 16, 1965
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, 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.
Chm. Martin
Gov. Robertson
Gov. Balderston
Gov. Shepardson
Gov. Mitchell
Gov. Daane
Gov. Maisel
Minutes of the Board of Governors of the Federal Reserve
System on Wednesday, June 16, 1965.
The Board met in the Board Room
at 10:00 a.m.
PRESENT:
Mr.
Mr.
Mr.
Mr.
Mr.
Martin, Chairman
Robertson
Shepardson
Mitchell
Daane
Sherman, Secretary
Kenyon, Assistant Secretary
Molony, Assistant to the Board
Cardon, Legislative Counsel
Hackley, General Counsel
Brill, Director, Division of Research
and Statistics
Mr. Farrell, Director, Division of Bank
Operations
Mr. Solomon, Director, Division of Examinations
Mr. Kakalec, Controller
Mr. Shay, Assistant General Counsel
Mr. Sammons, Adviser, Division of International
Finance
Mr. Kiley, Assistant Director, Division of Bank
Operations
Mr. Goodman, Assistant Director, Division of
Examinations
Mr. Leavitt, Assistant Director, Division of
Examinations
Mr. Smith, Assistant Director, Division of
Examinations
Mrs. Semia, Technical Assistant, Office of the
Secretary
Mr. Young, Senior Attorney, Legal Division
Mr. McClintock, Supervisory Review Examiner,
Division of Examinations
Mr. Poundstone, Review Examiner, Division of
Examinations
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Circulated or distributed items.
The following items, copies
f which are attached to these minutes under the respective item numbers
iti
dicated, were approved unanimously:
6/16/65
-2Item No.
Letter to Farmers and Merchants Bank, Huron, South
bakota, approving the establishment of a branch at
18th and Dakota Avenue South.
1
Letter to The Farmers State Bank of Waupaca, Waupaca,
Wisconsin, approving a proposed investment in bank
Premises.
2
Letter to Bankers International Corporation, New
lic'rk, New York, granting permission to purchase
additional shares
of Fabrica Espanola Magnetos,
S41-, Madrid, Spain.
3
Letter to the Federal Deposit Insurance Corporation
regarding the application of Gary-Wheaton Bank,
W.heaton, Illinois, for continuation of deposit
insurance after withdrawal from membership in the
Federal
Reserve System.
4
During discussion of Item No. 3, Governor Robertson commented
that he considered the proposed transaction borderline; the funds
14°uld be used for investment in a developed country.
would not object in this instance.
However, he
The investment would not be made
in dollars but in Swiss francs that Bankers International Corporation
had
borrowed in Europe through its parent, Bankers Trust Company.
Also,
e°mbined credits to foreigners by Bankers Trust and Bankers International
114d been brought down to the 105 per cent ceiling under the voluntary
f°reign credit restraint effort.
Bankers Trust had stated that the pro-
Posed investment would not have detrimental effects on its continued
efforts to comply with the program and would not inhibit its ability to
finance traditional customers' exports.
6/16/65
-3Report on competitive factors (Roanoke-Appalachia, Virginia).
There had been distributed a draft of report to the Comptroller of the
Currency on the competitive factors involved in the proposed merger of
The First National Bank of Appalachia, Appalachia, Virginia, into The
l'irst National Exchange Bank of Virginia, Roanoke, Virginia.
Discussion of the draft report included comments that the
Proposed take-over by First National Exchange Bank of a small bank 54
miles away reflected the over-all expansion trend among the large banks
ill Virginia.
This bank had acquired 17 of its 24 offices and over 40
Per cent of its deposits through 10 mergers since late 1960.
However,
in the circumstances of this particular case it was suggested that the
last sentence of
the draft conclusion, stating that
the overall effect
°f the proposed transaction on competition appears adverse" be deleted.
The report was then approved unanimously for transmittal to the
Comptroller with a conclusion in the following form:
There is virtually no competition existing between The
First National Bank of Appalachia and The First National
Exchange Bank of Virginia, Roanoke, and consummation of
the proposed merger would not significantly alter Roanoke
Bank's competitive capacity in the areas in which it currently operates, nor alter its position in relation to
Other large bank organizations in the State. It would
expand Roanoke Bank's geographic coverage into an additional county in southwestern Virginia. Since 1960 Roanoke
Bank has absorbed 10 banks in southwestern Virginia, and
consummation of this merger would further this trend.
Messrs. Shay, Sammons, Goodman, and Poundstone then withdrew
fz'01111 the
meeting,
:11,2‘te
6/16/65
Currency shipments (Item No.
).
The Board had entered into
a contract with Brink's, Incorporated, late in 1964 for the transportation of new Federal Reserve notes from Washington, D. C., to the Federal
Reserve Banks and branches.
However, the pouches and locks that had
been used previously when the Post Office Department handled such shipments continued to be used, although they were the property of the
De partment.
In a letter of March 18, 1965, the Department requested
the Federal Reserve System to discontinue the use of these pouches and
locks by June 30, 1965.
The Board's Division of Bank Operations had
a
rranged for the purchase from Federal Prison Industries, Inc., of
10,000 canvas pouches at a unit cost of $2.45.
The question of pro-
viding locks that would be suitable to replace the Post Office "K"
locks was investigated by the Subcommittee on Cash, Leased Wire, and
Sun
dry
Operations of the Presidents' Conference Committee on Miscella-
ne°11s Operations.
The report of the Subcommittee dated May 27, 1965,
reviewed the advantages and disadvantages of various locking devices
hathad been considered and recommended an initial purchase of 50,000
14ire hasp padlock seals from American Casting and Manufacturing Company,
?lainview, New York, at a cost of $17.50 a thousand, or $875.
The Sub-
c°mmittee's recommendation was approved by the Conference of Presidents
its meeting on June 14, 1965.
The Division of Bank Operations recom-
illended that the Board concur.
Mr. Farrell and Mr. Kiley reviewed the results of the studies
that had been made, the security procedures followed in shipments, and
6/16/65
-5-
methods that might be attempted to tamper with currency pouches.
The
wire hasp padlock seal that was recommended to be purchased could be
used only once, but it was inexpensive.
Although its construction was
simple, it appeared to be as tamper-proof as other available devices.
The Post Office Department staff had examined the device and expressed
the view that any tampering could be detected.
The General Auditors
of the Federal Reserve Banks had expressed some reservations about
Changing from the type of lock that had been used when the Post Office
13ePartment handled the shipments.
However, their over-all concern was
that security measures remain as effective as they had been in the past.
lloreover, the question had been placed before the General Auditors at
their recent conference without opportunity for full study of the matter.
After discussion the Board concurred unanimously in the action
of the
Conference of Presidents.
A copy of the letter informing Mr.
1(31)11, Chairman of the Conference, of this action is attached as Item
Messrs. Leavitt and Young then withdrew from the meeting and
Noyes, Adviser to the Board, entered the room.
Reserve Bank budgets (Item No. 61.
There had been distributed
a me
morandum from the Division of Bank Operations dated June 8, 1965,
sum4larizing the proposed budgets of the Federal Reserve Banks for the
8eCorid half of 1965, accompanied by detailed memoranda analyzing each
get.
Total operating expenses of the Reserve Banks for the second
6/16/65
-6-
half of the year were expected to be $92.7 million, which was about
$.1 million (.1 per cent) more than estimated for the first half, with
six Banks budgeting increases and the remaining six budgeting decreases
The largest budgeted increase of $600,000 (3 per cent) was at New York
and reflected plans to purchase an additional computer.
In commenting on the proposed budgets, Mr. Kiley remarked that
the majority of the Banks by now regarded the semiannual budget procedure as satisfactory.
Its effectiveness and acceptance, he believed,
were being furthered by the practice of having the budget officers come
to Washington individually to discuss the problems involved, and of
having Board representatives visit the Banks.
The principal improve-
ment in operating expenses, he noted, was to be found in the extension
Of high-speed check processing equipment, which by the end of this year
would
probably be in use at all Federal Reserve offices except four or
five of the smaller branches.
When such equipment was installed, there
Was at
first a transition period when expenses were somewhat higher,
Principally because of surplus staff.
That stage had now passed at
ManY of the Banks and branches, and thus the longer-term economies were
being realized.
In response to a question as to the proposed computer
Purchase at the New York Bank, he indicated that New York now had three
cOmPuters, one of which was to be replaced by the new one.
Governor Mitchell stated that he thought the Reserve Bank
budget
S as presently submitted furnished all the information that was
6/16/65
-7-
needed conveniently and concisely.
However, he had misgivings that
some of the Reserve Banks might be going about the preparation of their
budgets in an unnecessarily time-consuming and costly way.
He hoped
the Division of Bank Operations would undertake further investigation
of the process of budget preparation to reduce the work as much as
consistent with production of the necessary information.
Governor Shepardson asked if in the opinion of the Division of
sank Operations the move to semiannual budgets had resulted in a significant gain in planning and budget control.
Mr. Farrell responded that there had been a definite gain in
accuracy as compared with the older budget procedure, in which forecasts
had to be made in the third quarter of the year of expenses that would
be
incurred up to 18 months ahead.
those
tion,
Approval of overexpenditures under
circumstances amounted to little more than a rubber-stamp operawhereas the new procedure provided a better opportunity to review
e Penditures before rather than after the fact.
Governor Shepardson remarked that Governor Mitchell had made
go°d point on the need for keeping the budget preparation job from
getting out of bounds.
Mr. Farrell agreed and described steps that
were under way to encourage the use of comparable procedures at the
esPective Reserve Banks.
The budgets of the Federal Reserve Banks for the second half
°f 1965 were then accepted as submitted.
A copy of the letter sent
6/16/65
-8-
to the Federal Reserve Bank of Boston pursuant to this action is
attached as Item No. 6.
The letters to the other Reserve Banks were
similar in form.
Committee on centralization of data processing.
Governor
Robertson stated that the recent meeting of the Conference of Presidents
had been informed of developments leading to the decision of the Board
(on June 11, 1965) to move ahead with further study of remote computer
O perations.
Interest had been shown by the Presidents concerning the
P°a sibilities of eventual pooling of computer services, and an ad hoc
c°mmittee had been set up consisting of President Ellis as Chairman
and Messrs. Hickman, Swan, and Wayne to study System-wide needs in the
areas of data transmission and electronic processing.
A request had
been made that a member of the Board be designated to work with the
ad hoc committee.
The committee had not yet decided how to approach
its study, but it was considering full-time staff assistance and would
also.
lke to have representation from the Board's staff.
Governor
Robertson believed that the study to be undertaken by the ad hoc comIllittee was one in which the Board should cooperate.
The other members of the Board expressed agreement with that
Vi.-w.
Governor Robertson was designated as the member of the Board
who w
ould work with the ad hoc committee, and it was understood that
aPPr°Priate participation of Board staff members also would be arranged.
The discussion then reverted to the proposed computer purchase
by
the New York Reserve Bank, mentioned during discussion of the Reserve
6/16/65
-9-
Bank budgets.
During an exchange of comments on the economies that
resulted from using a machine for second and third shifts, it was
brought out that a study of workloads had indicated that New York's
Present computers were used 78 per cent of the time; however, the timing of particular recurring operations was in some cases an important
factor.
Governor Mitchell suggested that the recent report of uses of
the Board's computer by the various divisions, prepared at his request,
be made available to all of the Board members, and it was understood
that this would be done.
Mr. Farrell commented that work was under
Way to obtain from each Reserve Bank reports of computer utilization.
In response to his question whether that work should be continued,
members of the Board replied that they felt it would be desirable.
Mr. Smith then withdrew from the meeting.
Changes in bank supervision.
There had been distributed a
memorandum dated June 9, 1965, from the Division of Examinations submitting a draft of reply to a letter of May 14, 1965, in which Chairman
lIcelellan of the Permanent Subcommittee on Investigations of the Senate
eftMittee on Government Operations asked to be informed of any changes
in Policies, administrative procedures, and regulations with respect
t° supervision and examination of banks initiated since December 1964.
He
also stated that the Subcommittee would welcome suggestions and
recommendations as to possible legislation.
28
6/16/65
-10The draft of reply would colluuent on steps taken to minimize the
risk of problems arising from misuse of certificates of deposit; arrangements under which the Comptroller of the Currency now furnished to the
Federal Reserve the supplementary confidential memoranda regarding examinations of national banks; and efforts to inaugurate a more systematic
basis for coordinating sources of information regarding possible under14or1d infiltration of the banking system.
The draft reply would also
refer to the legislative program proposed in the Board's Annual Report
for 1964.
Mr. Cardon suggested that the reply be delayed for about two
weeks.
There did not seem to be any urgency in the matter, and at that
me pending questions might have been resolved in regard to the legislative proposal initiated by the Federal Deposit Insurance Corporation
to deal with the problem of excessive payment of interest on deposits.
If it could be reported that progress had been made in this area, the
ePly would be stronger.
There was agreement with this suggestion, and the reply to
Ch airman McClellan was therefore tabled.
Mr. McClintock then withdrew from the meeting.
Department store reports.
There had been distributed a memo-
randum from Mr. Sherman dated June 10, 1965, in which it was pointed
out that the Conference of Presidents at its meeting on March 1, 1965,
had •
indicated majority agreement with a program for withdrawal by the
6/16/65
-11-
Federal Reserve Banks from the preparation of department store sales
reports, with the understanding that any Reserve Bank that elected to
do so would continue to collect and publish weekly and perhaps monthly
sales data for local cities and areas in its district.
The program
contemplated:
(1) System withdrawal from the department store program
after January 1966 with an early announcement to respondents and
the public.
(2) Agreement by the System with the Census Bureau to
underwrite the cost of preparing monthly department store sales
figures for about 200 cities and local areas now shown in the
reports of the Federal Reserve Banks but not included in regular
Census reports prepared with appropriated funds. (The Presidents
felt the System should underwrite the cost of having Census
prepare these figures, in lieu of the work now done by the Reserve
Banks, during the period February 1966 through June 1967; Census
estimated this cost at $30,000 a year.)
(3) Announcement of plans by those Reserve Banks that would
continue to publish weekly or monthly reports of department store
sales by cities or areas, such announcements to be made at the
same time that the other Reserve Banks announced their plans to
discontinue the department store reports.
In general, this would be consistent with the program developed
by the Committee of Five (established by the Board in 1960 to study the
inatter) except that the Committee had rather anticipated that a majority
°f the Reserve Banks would continue to prepare local weekly and monthly
dePartment store sales comparisons, rather than to terminate the weekly
data and have the System underwrite the cost of having Census prepare
the monthly reports.
The program approved by the Presidents also fitted
in generally
with a program that was acceptable to the Office of Statistical
6/16/65
-12-
Standards of the Bureau of the Budget, which had over-all responsibility
for Federal statistical programs.
It was likewise acceptable to the
Bureau of the Census, which for many years had collected retail trade
data except for department stores.
The program had been developed with the full knowledge of the
trade representatives on the Committee of Five and, while it was not
"Pected to be entirely satisfactory to the trade, it was believed that
t could be put into effect without substantial protest from respondent
S tores.
The program had not been discussed with the press or with
market analysts who had used the Federal Reserve reports for many years,
and it was recognized that considerable disappointment might be expressed
from those quarters as to termination of weekly data of department store
sales by cities and of monthly sales broken down by departments.
The memorandum stated Mr. Sherman's recommendation, in which
he was joined by Messrs. Noyes and Brill, who had participated in the
discussions of the Committee of Five as well as those of the System
4aearch Advisory Committee, that the Board concur in the general proapproved by the Reserve Bank Presidents.
Attached were a draft
Of letter that would inform the Presidents of the Board's approval, a
su ggested letter for use by Reserve Banks in communicating with respondellt stores and others regarding the System's discontinuance of collection
Of
department store data, and a draft letter from Chairman Martin to the
ilresident of the National Retail Merchants Association.
6/16/65
-13In commenting on the recommendation, the memorandum noted that
this seemed a suitable time for the Federal Reserve to withdraw virtually
completely from the collection of retail trade statistics, a program
that it had initiated in 1919.
The Bureau of the Census had been col-
lecting current data on retail trade for other than department stores
since the 1930's.
It had made considerable advance in its work in this
field since establishment by the Board in 1960 of the Committee of Five,
and it had plans for further improvement during the next few years in
c urrent data on consumer buying.
The Federal Reserve had discontinued
a substantial part of its department store reporting service in this
Period, and the quality of Federal Reserve statistics on total department store sales had been somewhat improved in the meantime.
Neverthe-
less, there was widespread feeling that the System should eventually
terminate its activities in this area and leave to Census and others
the collection of data on retail trade.
All of the Reserve Bank Presi-
dents felt that the preparation of monthly sales by departments should
be d iscontinued by the Federal Reserve next January, both because the
Present data were of doubtful quality, even for informed users, and
because of reservations as to the usefulness of data of this particular
type for department stores only, even if it were possible to make their
quality
reasonably satisfactory.
The Presidents were not unanimous in
feeling that weekly and monthly reports of total department store sales
f°r cities and local areas should be discontinued by the Federal Reserve
6/16/65
Banks.
-14Messrs. Ellis, Hickman, and Irons felt that the weekly data
were needed and they planned to continue such reports indefinitely,
although it was understood that they would expect to discontinue them
if Census was able to continue the monthly series for cities and local
areas.
The memorandum noted the following key points:
(1) Discontinuance of the weekly reports of department
store sales for local areas would mean an absolute loss of such
data for most parts of the United States, since only the Boston,
Cleveland, and Dallas Reserve Banks now definitely planned to
continue collection and publication of these series. (Mr. Hickman
was the only Reserve Bank President who had favored having the
Federal Reserve pay the cost of having Census establish a weekly
report for local areas -- estimated at from $175,000 to $250,000
a year.)
(2) Discontinuance of the monthly departmental sales report
would mean an absolute loss of such data, both nationally and for
the larger cities or areas for which they were now compiled. The
Present data were of questionable value except to a small number
of users familiar with their limitations. The Board's efforts
to establish a new national departmental sales report for about
20 categories had not met with success because of lack of cooperation on the part of numerous department stores or chains.
Census now contemplated an annual departmental or merchandise
line report, but this was a couple of years away.
(3) Discontinuance by most Federal Reserve Banks of the
monthly department store sales reports for about 200 cities and
local areas would not mean loss of these series, provided Census
was furnished with funds ($30,000 a year) to pay the incremental
costs of compiling them. The present data were considerably
better in quality than were the monthly reports five years ago,
but further improvement would be anticipated. If, by mid-1967,
Census received a satisfactory appropriation, its program contemplated such data for a total of 60 metropolitan areas; neither
Census nor the Bureau of the Budget now envisaged local monthly
reports for more than the 60 metropolitan areas.
;
6/16/65
-15-
(4) If, as recommended by the Reserve Bank Presidents, the
Federal Reserve decided to provide funds to enable Census to
compile monthly local area data for the cities now covered by
the Reserve Banks, question might be expected to arise early in
1967 as to whether the list of cities should then be cut back to
what Census would be able to provide with appropriated funds.
It did not seem necessary or desirable at this time to try to
determine what should be done then. Thus, if the Federal Reserve
decided to provide funds for the period February 1966-June 1967,
it would seem well to do so with the understanding that the situation would be reviewed early in 1967 in the light of developments
up to that time.
(5) The Reserve Bank Presidents and the trade representatives who had served on the Committee of Five felt that some press
announcement of the Federal Reserve's program should be made simultaneously with the dispatch of letters to respondent stores informing them that most Reserve Banks would discontinue all retail trade
reporting activities with completion of reports for January 1966.
A principal reason for such a release was to have a document to
send to nonreporting persons and firms now receiving the Federal
Reserve reports--a far larger number than the respondent stores.
Mr. Sherman, in commenting on his memorandum, brought out among
Other things that if the Board should be averse to paying the cost
($30,000
a year) of having the Census Bureau prepare the monthly local
"figures from February 1966 through June 1967, he did not know of
4
anY other source for the money, and presumably these data would lapse
"tirelY until such time as Census might be able to obtain an appropriatio,
" to prepare the figures for the 60 largest standard metropolitan
statistical areas.
Although it was not possible for anyone to say with confidence
the trade and public reaction would be to the program of discontinuance, Mr. Sherman believed that if the change was ever to take
Place this was probably as good a time as could
be picked.
Although
6/16/65
-16-
there probably would be some disappointment, it seemed unlikely that
there would be a great campaign of protest such as had been experienced
in the spring of 1960 when it became known that the Federal Reserve was
contemplating discontinuance of preparing the department store data.
Governor Mitchell raised the question whether, if it was
anticipated that beginning in the middle of 1967 Census would prepare
figures for only the 60 largest centers, the remaining cities should
not be dropped now.
He doubted that the data Census would prepare for
anY cities other than the 60 would be reliable; in fact, this was one
°f the reasons the Federal Reserve was getting out of this area of
st
atistics.
If Census could prepare representative figures for the
60 centers sometime in the near future, he believed that the Board
could appropriately pay for preparation of the data in order to provide
a continuing series.
Reserve
He also felt the Board should insist that any
Bank that wanted to continue its weekly series bring the data
1115 to a high standard of quality.
In response to an observation by Mr. Sherman that coverage
14ae
better than three or four years ago, Governor Mitchell remarked
that this came back to the original basis for dissatisfaction with
ePartment store data, namely, that they were not sufficiently representative.
He hoped that more Reserve Banks would try to continue to
1° something with the weekly data, but he did not believe any Reserve
htlk should do so unless it could maintain quality standards.
6/16/65
-17Governor Daane inquired as to the willingness of the Bureau
of the Census to ask for the appropriation necessary to support continuance of the data.
Mr. Sherman stated that the Bureau of the Census was putting
in
its forthcoming budget a request for funds to prepare retail trade
data for the 60 or 62 largest centers.
Paring for those centers
The Bureau anticipated pre-
figures for all retail trade and for general
merchandise, apparel, and furniture and appliances (GAF), and it was
1411ing to provide a breakdown also for department stores, including
chain stores, discount houses, and others carrying department storetype merchandise.
The Bureau hoped, depending upon obtaining the funds
fr Om Congress and upon technical progress, to have the figures for the
60 or 62 largest centers available in this form for publication by
early 1967, which was about a year after preparation of the data would
be d iscontinued by the Federal Reserve.
A longer-run possibility was
that the number of centers might be increased to 80.
The possibility
Of cutting back to 60 centers immediately had been discussed a good
deal
The Census Bureau was willing to prepare figures of department
t°re sales—similar to but more broadly based than those prepared by
he Federal Reserve--for any of the 200 cities in which the Bureau
c°uld get a representative sample; lack of such a sample would result
14 4 oPping some of the present 200 cities, although the approach would
be to attempt to continue all of them for the time being.
The Committee
6/16/65
-18-
of Five and members of the Board's staff considered that procedure
preferable to cutting back now to the 60 centers that seemed fairly
sure of long-range continuance, particularly since the Federal Reserve
weekly series and departmental reports would apparently disappear
almost completely.
Governor Mitchell commented that he was not in favor of continuing retail sales figures that were of doubtful quality, but if
quality could be assured in terms of coverage of department store-type
merchandise, he would be willing to sponsor preparation of data for
2°0 cities or whatever number were involved.
At the conclusion of further discussion Governor Mitchell
in dicated general satisfaction with the program, provided the number
c)f centers for which data were continued was limited to those for which
meaningful statistics could be produced.
Other members of the Board
also expressed general agreement with the program, which it was underStood would be given further consideration at tomorrow's meeting.
The meeting then adjourned.
Secretary's Notes: On June 15, 1965, Governor
Shepardson approved on behalf of the Board
memoranda recommending the following actions
relating to the Board's staff:
Salar
increase
$4
Cleo J. Kray, Records Clerk, Office of the Secretary, from
cl'
930 to $5,330 per annum, with a change in title to Senior Records
erk, effective June 20, 1965.
4
6/16/65
-19-
Acceptance of resignations
Annie W. Becton, Substitute Maid, Division of Personnel Administration, effective at the close of business June 14, 1965.
Robert M. Steinberg, Economist, Division of Data Processing,
Effective July 6, 1965.
Governor Shepardson today approved on behalf
of the Board memoranda recommending the following actions relating to the Board's staff:
-§-1y increases
effective June 20
1965
A
Robert P. Forrestal, Attorney, Legal Division, from $8,650 to
.8,945 per annum.
Kathryn A. Morisse, Economist, Division of Research and Statistics,
fr°111 $7,465 to $7,710 per annum.
Franklin V. Walker, Economist, Division of Research and Statistics,
frclm $12,075 to $12,495 per annum.
Patricia Beckham, Stenographer, Division of Bank Operations, from
Y4,005 to $4,140 per annum.
James R. Smith, Accountant-Analyst, Division of Examinations, from
Y10)960 to $11,315 per annum.
ttve
John S. Hollis, Jr., Messenger (Driver), Division of AdministraServices, from $4,180 to $4,305 per annum.
Secretary
Item No.
6/16/65
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON, O. C. • 20551
ADORCSO OFFICIAL CORRIESPONOZNOE
TO THE BOARD
June 16, 1965
Board of Directors,
Farmers and Merchants Bank,
Huron, South Dakota.
Gentlemen:
The Board of Governors of the Federal Reserve
System approves the establishment by Farmers and Merchants
Bank, Huron, South Dakota, of a branch (detached drivein facility) at 18th and Dakota Avenue South, Huron,
South Dakota, provided the branch is established within
six months from the date of this letter.
Very truly yours
(Signed) Kenneth A. Kenyon
Kenneth A. Kenyon,
Assistant Secretary.
(The letter to the Reserve Bank stated that the
Board also had approved a six-month extension
of the period allowed to establish the branch;
and that if an extension should be requested,
the procedure prescribed in the Board's letter
of November 9, 1962 (S-1846), should be followed )
BOARD OF GOVERNORS
Item No. 2
6/16/65
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON, O. • C. 20551
ADONC811
ornaim. 01:301MCIIPONOCHCC
TO THE SOAR°
June 16, 1965
Board of Directors,
The Farmers State Bank,
Waupaca, Wisconsin.
Gentlemen:
The Board of Governors of the Federal Reserve
System approves under the provisions of Section 24A of
the Federal Reserve Act an investment in bank premises
of not to exceed $13800000 which is in addition to the
investment of $4,500 representing the'cost of the
building site, for the purpose of construction of a
new bank building and related costs.
Very truly yours,
(Signed) Kenneth A. Kenyon
Kenneth A. Kenyon,
Assistant Secretary.
Item No. 3
6/16/65
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON. D. C. 20551
ADDRESS OFFICIAL CORRESPONOENCE
TO THE aOARO
June 16, 1965.
Bankers International Corporation,
16 Wall Street,
New York 15, New York.
Gentlemen:
In accordance with the request and on the basis of the
information furnished in your letter of May 4, 1965, transmitted
through the Federal Reserve Bank of New York, the Board of Governors
grants consent to your Corporation to purchase and hold additional
Shares, par value Pesetas 1,000 each, of the capital stock of Fabrica
Espanola Magnetos, S.A. ("FEMSA"), Madrid, Spain, at a cost of approximately $333,000, provided such additional stock is acquired
wlthin one year from the date of this letter.
The Board also approves the purchase and holding of shares
of FEMSA within the terms of the above consent in excess of 10 per
cent of your Corporation's capital and surplus.
The foregoing consent is given with the understanding that
the foreign loans and investments of your Corporation, combined with
those of Bankers Trust Company and Bankers Company of New York, including the investment now being approved, will not exceed the
guidelines established under the voluntary foreign credit restraint
effort now in effect and that due consideration is being given to
the priorities contained therein.
Very truly yours,
(Signed) Kenneth A. Kenyon
Kenneth A. Kenyon,
Assistant Secretary.
BOARD OF GOVERNORS
Item No. 4
6/16/65
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON, D. C. 20551
ADORIEBB
arricIAL
OORRESPONOCNCIK
TO THE galOARO
June 16, 1965
Honorable K. A. Randall, Chairman,
Federal Deposit Insurance Corporation,
Washington, D. C. 20429
Dear Mr. Randall:
Reference is made to your letter of May 26, 1965,
concerning the application of Gary-Wheaton Bank, Wheaton,
Illinois, for continuance of deposit insurance after withdrawal
from membership in the Federal Reserve System.
There have been no corrective programs urged upon the
or agreed to by it, which have not been fully consummated,
!nd there are no such programs that the Board would advise be
-Ileorporated as conditions of admitting the bank to membership
!
ln the Corporation as a nonmember of the Federal Reserve System.
ba
Very truly yours,
(Signed) Kenneth A. Kenyon
Kenneth A. Kenyon,
Assistant Secretary.
BOARD OF GOVERNORS
Item No. 5
6/16/65
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON, D. C. 20551
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
June 17, 1965.
Mr. Karl R. Bopp, Chairman,
Conference of Presidents,
Federal Reserve Bank of Philadelphia,
P hiladelphia, Pennsylvania.
19101
Dear Mr. Bopp:
The Board concurs in the June 14, 1965 action of the
C°nference of Presidents approving the recommendations contained
Y1 the May 27, 1965 report of the Subcommittee on Cash, Leased
Wire and Sundry Operations that canvas pouches and wire-hasp
Padlock seals be used in connection with shipments of new Federal
eserve currency from Washington to the various Reserve Banks and
b
ranches.
The canvas pouches have been ordered from Federal
!rison Industries Incorporated and an order for the seals is
;:ing placed with the American Casting and Manufacturing Company,
lainview, New York. It is understood that the cost of these
,ems will be distributed to the Reserve Banks on the basis of
cheir capital surplus ratio.
I
Very truly yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
Item No. 6
6/16/65
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON, D. C. 20551
ADDRESS
orriciAL
CORRESPONDENCE
TO THE BOARD
June 16, 1965.
Mr. George H. Ellis, President,
Federal Reserve Bank of Boston,
Boston, Massachusetts. 02106.
Dear Mr. Ellis:
The Board of Governors has reviewed and accepts
the budget of the Federal Reserve Bank of Boston for the
Period July 1 - December 31, 1965, as submitted with
Mr. Latham's letter of May 11, 1965.
Very truly yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
@FedFRASER