Full text of Minutes of the Board of Governors of the Federal Reserve System : Meeting Minutes, June 27, 1941, Volume 28, Part 2

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78

A meeting of the Board of Governors of the Federal Reserve
at 11:00
System was held in Washington on Friday, June 27, 1941,
a.m.
PRESENT:

Mr.
Mr.
Mr.
Mr.
Mr.

Eccles, Chairman
Ransom, Vice Chairman
Szymczak
McKee
Draper

Mr.
Mr.
Mr.
Mr.

Morrill, Secretary
Bethea, Assistant Secretary
Carpenter, Assistant Secretary
Clayton, Assistant to the Chairman

of the matters herein—
The action stated with respect to each
after referred to was taken by the Board:
of Governors of the
The minutes of the meeting of the Board
1941, were approved unani—
Federal Reserve System held on June 26,
mously.
President of the Federal
Telegrams to Mr. Paddock, First Vice
Secretary of the Federal Reserve
Reserve Bank of Boston, Mr. Sanford,
Federal Reserve Bank
Bank of New York, Mr. Leach, President of the
Stewart, Secretaries of
of Richmond, Messrs. McCravey, Dillard, and
St. Louis, respec—
the Federal Reserve Banks of Atlanta, Chicago, and
Federal Reserve Bank of
tively, Mr. Ziemer, Vice President of the
the Federal Reserve Bank of
Minneapolis, Mr. Caldwell, Chairman of
the Federal Reserve Bank of
Kansas City, Mr. Gilbert, President of
Federal Reserve Bank of San
Dallas, and Mr. Hale, Secretary of the
approves the establishment without
Francisco, stating that the Board
24, by
change by the Federal Reserve Bank of San Francisco on June




-2-

6/27/41

the Federal Reserve Banks of New York, Richmond, Atlanta, Chicago,
St. Louis, Minneapolis, Kansas City, and Dallas on June 26, 1941, and
the rates of discount
IDY the Federal Reserve Bank of Boston today, of
and purchase in their existing schedules.
Approved unanimously.
ter, Assistant
Memoranda dated June 26, 1941, from Mr. Carpen
of Bert C. Dedman, as an index
Secretary, submitting the resignations
file clerk, both in the
Clerk, and Frances P. Campbell, as a junior
close of business on June
Office of the Secretary, effective as of the
ending that the resigna25 and June 30, 1941, respectively, and recomm
tions be accepted as of these dates.
The resignations were accepted.
Mr. Nelson, Assistant
Memorandum dated June 26, 1941, from
Warner, elevator operator,
Secretary, recommending (1) that Robert P.
be promoted to the position of guard in the Building Operation and
ary's Office on a temporary basis
Maintenance Section of the Secret
be increased from '1,200
for an indefinite period and that his salary
1941, with the understanding
to q1380 per annum, effective July 1,
next six months is
that if his work in the new position within the
recommendation will be made that
entirely satisfactory, a further
his salary be increased to '1,500 per annum, and (2) that James F.
r in the Building Operation
Latham be appointed as an elevator operato
and Maintenance Section of the Secretary's Office on a temporary
q1200
basis for an indefinite period, with salary at the rate of




. 780

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6/27/41

per annum, effective as of the date upon which he commences the perrily the usual
formance of his duties after having passed satisfacto
Physical examination.
Approved unanimously.
Memorandum dated June 24, 1941, from Mr. Nelson, Assistant
Secretary, recommending that, for the reason stated in the memorandum,
MiSS

Alice M. Hanson be appointed as a stenographer in the Office of

the Secretary, with salary at the rate of S1,560 per annum, effective
as of the date upon which she enters upon the performance of her duties
after having passed satisfactorily the usual physical examination.
Approved unanimously.
Memorandum dated June 24, 1941, from Mr. Carpenter recommending
that Misses Laura S. Talbott and Emily A. McAllister be appointed on a
of the Secretary,
Permanent basis as junior file clerks in the Office
each with salary at the rate of t1,440 per annum, effective July 1,
1941.
Approved unanimously.
General Counsel,
Memoranda dated June 17, 1941, from Mr. Wyatt,
recommending, for the reasons stated in the memoranda, that the followof General Counsel
ing increases in salaries of employees in the Office
be made effective as of July 1, 1941; and that the title of Helen V.
Dolan be changed from Clerk to Law Clerk:




781

-4-

6/27/41

Name
Nadine L. Gallagher
Helen V. Dolan
Grace L. Costinett
Jerome W. Shay

Designation

Salary Increase
From
To

Stenographer
Clerk
Stenographer
Law Clerk

$1,740
1,900
1,960
2,900

‘1,800
2,000
2,060
3,200

Approved unanimously.
1941, from Mr. Goldenweiser,
Memoranda dated June 24 and 26,
Statistics, submitting the
Director of the Division of Research and
as an Associate Economist in that
resignation of Maxwell R. Conklin
of business on June 25, 1941, and
Division, effective as of the close
be accepted as of that date.
recommending that the resignation
The resignation was accepted.
Reserve Agent at the Federal
Letter to Mr. Nardin, Federal
follows:
Reserve Bank of St. Louis, reading as
contained in your
"In accordance with the request
Governors approves
of
Board
letter of June 18, 1941, the
chner as Alternate
Kears
C.
the appointment of Mr. Alfred
Bank at a salary
your
at
Assistant Federal Reserve Agent
July 1, 1941,
tive
effec
,
at the rate of $1,500 per annum
will be placed
chner
Kears
with the understanding that Mr.
y responsible
solel
be
will
upon the Agent's pay roll and
of
e
Agent, to
offic
the
to you, or, during a vacancy in
the
Board of
to
and
,
the Assistant Federal Reserve Agent
s. When
his
dutie
of
e
rmanc
Governors, for the proper perfo
as
s
nate
dutie
Alter
his
of
not engaged in the performance
the
val
with
appro
may,
he
Assistant Federal Reserve Agent
cy
in
vacan
a
g
durin
or,
,
of the Federal Reserve Agent
Assistant Federal Reserve
the office of the Agent, of the
such work for the Bank
rm
perfo
Agent, and the President,
duties as Alternate
his
with
nt
siste
as will not be incon
.
Agent
ve
Reser
Assistant Federal
the usual oath of of—
"Mr. Kearschner should execute
of
t
amoun
P)10,000, and he should
the
in
bond
fice and surety
his
duties as Alternate
of
e
rmanc
perfo
not enter upon the




782

-5-

6/27/41

bond has been ex"Assistant Federal Reserve Agent until the
its execution
er
wheth
mine
deter
to
amined by your counsel
the
reverse side
on
ed
print
rules
complies fully with the
should be forbond
the
which
wing
follo
of form of bond 182,
warded to the Board promptly for approval."
Approved unanimously.
al Reserve Bank
Letter to Mr. Caldwell, Chairman of the Feder
of Kansas City, reading as follows:
in your
"In accordance with the request contained
nors
approves
of
Gover
Board
the
1941,
letter of June 19,
as
er
tant
doerf
Assis
Allen
ce
Mauri
the appointment of Mr.
at
y
the
salar
a
at
Bank
your
at
Federal Reserve Agent
as of the date he asrate of 3,096 per annum, effective
Reserve Agent, with
al
Feder
tant
Assis
sumes him duties as
will be placed
er
doerf
Allen
Mr.
the understanding that
y responsible
solel
be
will
and
roll
pay
upon the Agent's
of
e
Agent, to
offic
the
in
cy
vacan
a
g
to you, or, durin
rmance of his
the Board of Governors, for the proper perfo
e
rmanc of his duties
duties. When not engaged in the perfo
with the apas Assistant Federal Reserve Agent, he may,
perform such work
proval of the Agent and the President,
nt with his duties
for the Bank as will not be inconsiste
as Assistant Federal Reserve Agent.
the usual oath of
"Mr. Allendoerfer should execute
amount of ,110,000, and he
office and surety bond in the
rmance of his duties as Asperfo
the
should not enter upon
the bond has been exsistant Federal Reserve Agent until
mine whether its execution
amined by your counsel to deter
ed on the reverse side
print
rules
complies fully with the
the bond should be
which
wing
follo
of form of bond 182,
approval.
forwarded to the Board promptly for
er will succeed Mr.
doerf
Allen
Mr.
"It is noted that
tant Federal ReAssis
as
n
natio
desig
H. H. Rhodes, whose
June
17, 1941.
of
as
you
by
nated
serve Agent was termi
to the Boa-rd's
tion
objec
any
is
there
Please advise whether
is under no
it
involved that
informing the bonding company
as
s
Assistant
Mr. Rhode
obligation on the bond executed by
by
him
subsetted
commi
Federal Reserve Agent for any acts
1!_r.
e
date
the
advis
quent to June 17, 1941. Also, please
Assistant Federal ReAllendoerfer assumes his duties as
serve Agent.




Approved unanimously.

-6-

6/27/41
Letter to

Mr.

West, Vice President of the Federal Reserve

Bank of San Francisco, reading as follows:
in your
"In accordance with the request contained
the
appointves
letter of June 20, 1941, the Board appro
for the Fedment of Mr. Edmund H. Galvin as an examiner
e
advise us of
eral Reserve Bank of San Francisco. Pleas
the effective date of his employment."
Approved unanimously.
zens Bank of
Letter to the board of directors of the "Citi
stating that, subject to conSouth Boston", South Boston, Virginia,
contained in the Board's Reguditions of membership numbered 1 to 3
s application for membership in
lation H, the Board approves the bank'
t of stock in
the Federal Reserve System and for the appropriate amoun
the Federal Reserve Bank of Richmond.
The letter also contained the following special comment:
sses certain powers
"It appears that the bank posse
which are not necessarily
which are not being exercised and
business, such as the
required in the conduct of a banking
bonds. Attention is inpower to guarantee the payment of
desires to exercise any
vited to the fact that if the bank
the time of admission to
powers not actually exercised at
under condition of membermembership, it will be necessary
permission of the Board of
ship numbered 1 to obtain the
In this connection, the
Governors before exercising them.
been no change in the scope
Board understands that there has
by the bank since the
of the corporate powers exercised
rship."
date of its application for membe
Approved unanimously, together with a
letter to Mr. Leach, President of the Federal Reserve Bank of Richmond, reading as
follows:
m
"The Board of Governors of the Federal Reserve Syste




784
-7-

6/27/41

"approves the application of the 'Citizens Bank of South
in the
Boston', South Boston, Virginia, for membership
preions
condit
the
to
t
subjec
,
Federal Reserve System
ted
are
reques
you
which
letter
scribed in the enclosed
the
ution.
of
instit
ors
Direct
of
to forward to the Board
Two copies of such letter are also enclosed, one of which
is for your files and the other of which you are requested
to forward to the Commissioner of Banking for the Commonwealth of Virginia for his information.
"It has been noted that Mr. Arthur Tuck has apparently
disqualified himself as a director through hypothecation
of his entire holdings of stock in the bank. It is noted,
also, that he recently gave the bank a signed financial
of his indebtedness.
statement which did not include all
d
that he is no longer
assume
is
it
In the circumstances,
te
to this effect
advice
defini
but
serving as a director,
will be appreciated."
Letter to Mr. Fry, Vice President of the Federal Reserve Bank
of Richmond, reading as follows:
"Reference is made to your letter of June 17, 1941,
al Savings and Trust
submitting a request from the Nation
Board
for approval
the
to
C.,
D.
gton,
Company, Washin
the
of
24A
n
Federal ReSectio
of
ions
under the provis
0 for the
of
S20,00
iture
expend
ed
propos
serve Act of a
its
in
bank premements
improv
n
certai
purpose of making
ises.
"In accordance with your recommendation, the Board
g
approves the proposed expenditure with the understandin
off
d
the
during
charge
not
is
iture
that, if the expend
iation in the
year, provisions will be made for deprec
at
least to the
equal
s
amount
in
proposed improvements
es."
tax
purpos
income
l
Federa
maximum allowable for
Approved unanimously.
ia", Fredonia, New York,
Letter to "The National Bank of Fredon
reading as follows:
January
"This refers to the resolution adopted on
signify14, 1941, by the board of directors of your bank,
se
ing the bank's desire to surrender its right to exerci




785
-8-

6/27/41

"fiduciary powers heretofore granted to it.
"The Board, understanding that your bank has been
discharged or otherwise properly relieved in accordance
with the law of all of its duties as fiduciary, has issued
a formal certificate to your bank certifying that it is no
longer authorized to exercise any of the fiduciary powers
covered by the provisions of section 11(k) of the Federal
Reserve Act, as amended. This certificate is enclosed
herewith.
"In this connection, your attention is called to the
fact that, under the provisions of section 11(k) of the
Federal Reserve Act, as amended, when such a certificate
has been issued by the Board of Governors of the Federal
Reserve System to a national bank, such bank (1) shall no
longer be subject to the provisions of section 11(k) of
the Federal Reserve Act or the regulations of the Board
of Governors of the Federal Reserve System made pursuant
thereto, (2) shall be entitled to have returned to it any
securities which it may have deposited with the State or
similar authorities for the protection of private or court
trusts, and (3) shall not exercise any of the powers conferred by section 11(k) of the Federal Reserve Act except
with the permission of the Board of Governors of the Federal Reserve System
a certified
"Since it may be necessary for you to file
State
authorities
copy of the Board's certificate with the
ies
which you
securit
the
of
release
the
with
in connection
d
hereenclose
is
copy
a
such
them,
with
have deposited
with."
Approved unanimously.
ller of the Currency,
Letter to Honorable Preston Delano, Comptro
reading as follows:
are enclosed
"For your information and files, there
Ira Clerk,
Mr.
from
1941,
20,
June
dated
copies of letters
of San
e
Bank
Reserv
l
Federa
the
of
ent
First Vice Presid
s
letter
These
ation.
Corpor
erica
Transam
Francisco, to
was
tion
express the conclusion that Transamerica Corpora
& S.A.
a holding company affiliate of Bank of America N.T.
the
y
state
and
briefl
and The National Bank of Washington,
facts upon which such conclusions were reached."




Approved unanimously.

'786

-9-

6/27/41

Telegram to Mr. Knoke, Vice President of the Federal Reserve
Bank of New York, reading as follows:
"Relet 26, Board approves action your executive
committee that date in authorizing officers your Bank,
in case Bank is formally approached by Banco Central de
Reserva de Fl Salvador in matter, to advise such Central
Bank of your willingness to make at any time and from
time to time any loan or loans to it on following terms
and conditions:
(a) the amount to be advanced not to exceed
in the aggregate at any one time ';1,000,000,
to be secured by refined gold bars earmarked
in your vaults in its name of a value equivalent to at least 111% of the aggregate amount
of loan or loans outstanding from time to time
(b) such loans to run for a maximum of one year
subject to prior repayment by such Central Bank
at any time upon 30 days notice to you by that
Bank
(c) interest to be at your Bank's discount rate
on amounts actually advanced.
"Participation in loan or loans by other Reserve
Banks is approved and they are being advised accordingly
by letter."
Approved unanimously.

Thereupon the meeting adjourned.

1b6ZaTi 014444_

Secretary.

Approved:
/




,
Chairman.